[Code of Federal Regulations]
[Title 13, Volume 1]
[Revised as of January 1, 1999]
From the U.S. Government Printing Office via GPO Access
[CITE: 13CFR124.302]

[Page 255-256]
 
                               ASSISTANCE
 
                CHAPTER I--SMALL BUSINESS ADMINISTRATION
 
PART 124--8(A) BUSINESS DEVELOPMENT/SMALL DISADVANTAGED BUSINESS STATUS DETERMINATIONS--Table of Contents
 
                  Subpart A--8(a) Business Development
 
Sec. 124.302  What is early graduation?

    (a) General. SBA may graduate a firm from the 8(a) BD program prior 
to the expiration of its Program Term where SBA determines that:
    (1) The concern has successfully completed the 8(a) BD program by 
substantially achieving the targets, objectives, and goals set forth in 
its business plan prior to the expiration of its program term, and has 
demonstrated the ability to compete in the marketplace without 
assistance under the 8(a) BD program; or
    (2) One or more of the disadvantaged owners upon whom the 
Participant's eligibility is based are no longer economically 
disadvantaged.
    (b) Criteria for determining whether a Participant has met its goals 
and objectives. In determining whether a Participant has substantially 
achieved the targets, objectives and goals of its business plan and in 
assessing the overall competitive strength and viability of a 
Participant, SBA considers the totality of circumstances, including the 
following factors:
    (1) Degree of sustained profitability;
    (2) Sales trends, including improved ratio of non-8(a) sales to 8(a) 
sales since program entry;

[[Page 256]]

    (3) Business net worth, financial ratios, working capital, 
capitalization, and access to credit and capital;
    (4) Current ability to obtain bonding;
    (5) A comparison of the Participant's business and financial 
profiles with profiles of non-8(a) BD businesses having the same primary 
four-digit SIC code as the Participant;
    (6) Strength of management experience, capability, and expertise; 
and
    (7) Ability to operate successfully without 8(a) contracts.
    (c) Excessive withdrawals. SBA may graduate a Participant prior to 
the expiration of its program term where excessive funds or other assets 
have been withdrawn from the Participant (see Sec. 124.112(d)(3)), 
causing SBA to determine that the Participant has demonstrated the 
ability to compete in the marketplace without assistance under the 8(a) 
BD program.
    (d) Benchmark achievement. SBA may graduate a Participant prior to 
the expiration of its program term where the Participant has 
substantially achieved the targets, objectives and goals of its business 
plan as adjusted under Sec. 124.403(d) and its primary industry 
classification falls within a SIC Major Group in which the benchmarks 
described in Sec. 124.403(d) have been achieved.

[63 FR 35739, 35772, June 30, 1998]