Page:United States Statutes at Large Volume 94 Part 1.djvu/903

 PUBLIC LAW 96-302—JULY 2, 1980 "(B) The plan requiring the Administrator's approval under subparagraph (A) shall be submitted to the Administration by the trustee of such trust with its application for the guarantee. Such plan shall include an agreement with the Administrator which is binding on such trust and on the small business concern and which provides that— "(i) not later than the date the loan guaranteed under subparagraph (A) is repaid (or as soon thereafter as is consistent with the requirements of section 401(a) of the Internal Revenue Code of 1954), at least 51 percent of the total stock of such concern shall be allocated to the accounts of at least 51 percent of the employees of such concern who are entitled to share in such allocation, "(ii) there will be periodic reviews of the role in the management of such concern of employees to whose accounts stock is allocated, and "(iii) there will be adequate management to assure management expertise and continuity. "(C) In determining whether to guarantee any loan under this paragraph, the individual business experience or personal assets of employee-owners shall not be used as criteria, except inasmuch as certain employee-owners may assume managerial responsibilities, in which case business experience may be considered. "(D) For purposes of this paragraph, a corporation which is controlled by any other person shall be treated as a small business concern if such corporation would, after the plan described in subparagraph (B) is carried out, be treated as a small business concern. "(E) The Administrator shall compile a separate list of applications for assistance under this paragraph, indicating which applications were accepted and which were denied, and shall report periodically to the Congress on the status of employee-owned firms assisted by the Administration.''. SEC. 506. (a) The Administrator of the Small Business Administration shall enter into a contract with an independent consultant which provides for a study by such consultant of the feasibility of making loan guarantees under section 7(a) of the Small Business Act directly to the seller of a small business concern in connection with the installment sale of such concern. Such study shall include an analysis of at least the following: (1) the extent and nature of the use of installment sales for the sale of small business concerns, (2) the ability of the Small Business Administration to make credit judgments in connection with installment sales, (3) the need for Small Business Administration loan guarantees to facilitate installment sales, (4) the willingness of banks and other financial institutions to participate in the evaluation of installment sales, and (5) the anticipated cost of such a guarantee program in comparison to other loan guarantee programs of the Small Business Administration.

94 STAT. 853 Plan, submittal to SBA.

26 USC 401.

Periodic review.

Loan guarantee criteria, restriction.

Applications list; report to Congress.

Feasibility study by independent consultant.

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