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b) The operating small business concern is an eligible small <br /> business and the proposed use of proceeds would be allowable <br /> for such assistance if the operating small business concern <br /> were the owner of the property that is owned or to be owned by <br /> the applicant; <br /> c) The ownership interests in the applicant shall be completely <br /> identical with and in the same proportion as the ownership <br /> interest in such operating small business concern; <br /> d) Collateral includes an assigntment of the lease between the <br /> applicant and the operating small business concern and a lien <br /> on the property itself. The lease, including options, shall be for <br /> a term of not less than the term of the loan; <br /> e) The operating small business concern must be either a <br /> guarantor or co-borrower, and any owners of 20% or more of <br /> the equity of the operating small business concem and of the <br /> applicant must also guarantee the loan. <br /> Franchises A franchise is eligible for the Oakdale Seed Fund if the franchise <br /> has the right to profit from his/her efforts commensurate with <br /> ownership and is eligible in all other respects. Franchises are <br /> ineligible only in the exceptional cases where the franchise <br /> agreement disguised as a contract of employment under the guise <br /> of a franchise operation. Where royalty or similar payments must <br /> be made by the borrower to the franchisor, a condition should be <br /> considered that prohibits such payment as long as the EDA loan is <br /> in default. Where credit factors warrant, guarantee of the <br /> franchisor should also be considered. <br /> Operational <br /> Requirements Re,,2qnsibiliiHt,,;s o� e E M./Oakdale, Seed und <br /> ................... a, ,ed.Pund <br /> The Oakdale EDA/Seed Fund will offer its assistance to small <br /> business in need of financing. It will cooperate with other lenders <br /> participating in projects. The EDA and the Seed Fund are able to: <br /> a) Package and process loan applications <br /> b) Close and service loans <br /> c) Make available management services or cause such services to <br /> be made available <br /> ................. ........................ <br /> 57 <br />