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Franchise Form

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Franchise Form
Follow-on questions to establish CalCAP enrollment eligibility pursuant to CalCAP Regs

Section 8070(v), definition of a "Small Business Concern."



The questions are designed to establish whether or not there exists an "affiliation based on

franchise and license agreements" between the franchisee/borrower, and the franchisor,

__________________________

(name of business)

Material related to the Core Issue:



[The following is in reference to Title 13, CFR, Part 121 Subpart A].



Section 121.103 (i)

Affiliation based on franchise and license agreements. The restraints imposed on a franchisee or

licensee by its franchise or license agreement relating to standardized quality, advertising,

accounting format and other similar provisions, generally will not be considered in determining

whether the franchisor or licensor is affiliated with the franchisee or licensee provided the

franchisee or licensee has the right to profit from its efforts and bears the risk of loss

commensurate with ownership. Affiliation may arise, however, through other means, such as

common ownership, common management or excessive restrictions upon the sale of the

franchise interest.



Questions to help us make a determination:



1) What is the ownership structure for the borrower/franchisee, ____________ and to what

extent, if any, does the franchisor, ______________ have an ownership interest? ____%





2) Does the borrower/franchisee, _________________, have additional franchise sites that would

put it in excess of a combined 100 employees? Yes or No





3) Does the borrower/franchisee, _____________________have the right to profit from its

efforts? Yes or No



4) Does the borrower/franchisee,_______________ bear the risk of loss commensurate with

ownership? Yes or No



5) Does the franchisor, ________________ share in any of the profits or the risk of loss with the

borrower/franchisee____________________? Yes or No


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