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Expedited Licensing for Impact SBICs
Applying for an Impact SBIC License
Fund managers seeking to obtain an Impact SBIC License must follow the same application process, submit the same documentation and meet the same high standards as other applicants to the SBIC Program. However, because Impact SBIC applicants hold the potential of generating enhanced social returns through their investments in underserved communities and sectors of national priority, SBA is committing to process Impact SBIC applications on an expedited basis:
Phase I: Initial Review (60 Days)
During this phase, SBA reviews the qualifications of the fund managers, the viability of the investment strategy and assesses the likelihood the proposed SBIC will be able to deploy at least 50% of its total invested capital into Impact Investments.
Please note that Impact SBICs are required to complete Appendix 2 of Form 2181 – Narrative as part of their application. This section asks applicants to describe the impact investment strategy they plan to pursue upon licensing. Impact SBICs intending to make Fund-Identified impact investments are required to provide specific information regarding their strategy and should refer to Eligible Impact Investments or the Impact Investment Fund Policy document for guidance.
Phase II: Capital Raise (Unique to each Fund)
Impact SBIC applicants approved at Phase I will receive a "green light" letter inviting them to submit a License Application and begin Phase III once they have raised a minimum amount of private capital. Once a "green light" is received, if an Impact SBIC applicant determines, for any reason, that it would prefer to be considered for licensing as a Standard SBIC and no longer as an Impact SBIC, it will be required to return to Phase I and restart the application process without assurance of an expedited processing time.
Phase III: Licensing (90 Days)
With a minimum, acceptable level of private capital raised, an Impact SBIC applicant may finalize the licensing process with the submission of a License Application. In order to process the License Application as quickly as possible, SBA suggests that all applicants adhere closely to SBA's model limited partnership agreement and the additional guidance in Technote 15 and Attachment 2 in Technote 14.
Some Impact Investment SBICs may have an interest in using the Energy Savings Debentures, a financing instrument available to all licensed SBICs. If demand for Energy Savings Debentures exceeds availability, SBA will develop procedures which give priority to Impact Investment SBICs seeking to issue these types of debentures.