Section IV. Borrower’s Affiliates Information
Provide information in columns #1, 2, 3, 4, and 5 below for all of Borrower’s affiliates.
For #2, select all types of relationships to Borrower that apply. For each type that is selected, provide additional detail about that relationship in the text field “Additional
detail on Affiliate relationship to Borrower”:
• If “Affiliation based on ownership” is selected, identify the owner (the Borrower, the Affiliate, another specified entity, or a specified individual) and the
percentage of ownership (e.g., Affiliate is a 60% owner of Borrower; Borrower is a 51% owner of Affiliate).
• If “Affiliation arising under stock options, convertible securities, and agreements to merge” is selected, identify whether the basis for affiliation is stock
options, convertible securities, or an agreement to merge.
• If “Affiliation based on management” is selected, identify the common manager or management agreement.
• If “Affiliation based on identity of interest” is selected, identify the close relative(s) and the business or economic interest.
For #5, provide information for A, B, or C depending on the size standard you indicated in Section II:
• Use 5.A if Borrower used A. Employee-based Size Standard;
• Use 5.B if Borrower used B. Receipt-based Size Standard; or
• Use 5.C (both the TNW and ANI columns) if Borrower used C. Alternative Size Standard.
If additional rows are needed to list all affiliates, provide information on a separate sheet identified as Addendum A. In the right-hand column (labeled “Confidential?”),
indicate whether the information in your answers is customarily kept confidential by entering 1, 2, 3, 4, 5.A, 5.B, and/or 5.C.
For an explanation of the four tests for affiliation that apply to participants in the Paycheck Protection Program, see https://www.sba.gov/document/support-affiliation-
rules-paycheck-protection-program and 85 FR 20817 (April 15, 2020).
For purposes of determining affiliation based on equity ownership, an entity is an affiliate of an individual, concern, or entity that owns or has the power to control
more than 50 percent of the entity’s voting equity. If no individual, concern, or entity is found to control, SBA will deem the Board of Directors or President or Chief
Executive Officer (CEO) (or other officers, managing members, or partners who control the management of the entity) to be in control of the entity. SBA will deem a
minority shareholder to be in control, if that individual or entity has the ability, under the entity’s charter, bylaws, or shareholder’s agreement, to prevent a quorum or
otherwise block action by the board of directors or shareholders. See 13 CFR 121.301(f)(1).
For purposes of determining size, SBA considers stock options, convertible securities, and agreements to merge (including agreements in principle) to have a present
effect on the power to control an entity. SBA treats such options, convertible securities, and agreements as though the rights granted have been exercised. Agreements to
open or continue negotiations towards the possibility of a merger or a sale of stock at some later date are not considered “agreements in principle” and are thus not given
present effect. Options, convertible securities, and agreements that are subject to conditions precedent which are incapable of fulfillment, speculative, conjectural, or
unenforceable under state or Federal law, or where the probability of the transaction (or exercise of the rights) occurring is shown to be extremely remote, are not given
present effect. An individual, concern or other entity that controls one or more other entities cannot use options, convertible securities, or agreements to appear to
terminate such control before actually doing so. SBA will not give present effect to individuals’, concerns’, or other entities’ ability to divest all or part of their
ownership interest in order to avoid a finding of affiliation. See 13 CFR 121.301(f)(2).
Affiliation based on management arises where the CEO or President of the PPP borrower (or other officers, managing members, or partners who control the
management of the borrower) also controls the management of one or more other entities. Affiliation also arises where a single individual, concern, or entity that
controls the Board of Directors or management of one entity also controls the Board of Directors or management of one of more other entities. Affiliation also arises
where a single individual, concern or entity controls the management of the PPP borrower through a management agreement. See 13 CFR 121.301(f)(3).
Affiliation based on identity of interest arises when there is identity of interest between close relatives with identical or substantially identical business or economic
interests (such as where the close relatives operate entities in the same or similar industry in the same geographic area). See 13 CFR 121.301(f)(4). “Close relative” is a
spouse; a parent; or a child or sibling; or the spouse of any such person. See 13 CFR 120.10.
SBA Form 3511 (12/2020) 4