15 U.S.C. § 681 — Organization

(a) Incorporation and charter under State law; period of succession; area of operations. A small business investment company must be a corporation, limited liability company, or limited partnership organized and chartered, or otherwise existing, under State law solely to perform this subchapter’s functions. A corporation must continue for at least 30 years unless its shareholders dissolve it sooner; a limited partnership must continue for at least 10 years. The company must have the powers reasonably needed for its work. The Administration must approve its operating area and any branch offices or agencies if its articles authorize them. (b) Articles; approval. The articles must generally state the company’s purposes, name, operating area or areas, principal-office location, and amount and classes of capital stock. They may include other provisions consistent with this chapter. The Administration must approve the articles and later amendments. (c) License. (1) An applicant must submit an Administrator-prescribed application and documents. (2)(A) Within 90 days after first receiving it, the Administrator must give the applicant a written status report listing remaining requirements. (B) Within a reasonable time after receiving a complete application meeting prescribed requirements, the Administrator must approve it and issue a license if this section’s requirements are met, or disapprove it and give written notice. (3) The Administrator must determine whether the applicant meets section 682(a) and (c) and whether its management is qualified and has the knowledge, experience, and ability needed to comply with this chapter. The Administrator must consider the need for and availability of small-business financing in the geographic area, the owners’ and managers’ business reputation, and the likelihood of successful, profitable, financially sound operations. The Administrator must not consider a projected shortage or unavailability of leverage and must give first priority to an applicant in an underlicensed State with below-median financing, as the Administrator determines. (4)(A) For special circumstances and good cause, the Administrator may approve and license an applicant with at least $3,000,000 in private capital that otherwise qualifies but does not meet section 682(a), if it has a workable business plan reasonably projecting profit and a reasonable timetable for meeting section 682(a). (B) Such an applicant generally cannot receive leverage until it meets section 682(a). It may receive one tier of leverage earlier only if it is in a State with no licensee or in an underlicensed State and agrees to that one-tier limit. (d) Repealed. Public Law 104–208 repealed this subsection. (e) Fees. (1) The Administration may set license-application fees. (2) Fees must be deposited in the Administration’s salaries-and-expenses account and may be appropriated only to cover licensing-examination costs.