Glossary · People and paperwork
Franchise Addendum
In short
If you're buying a franchise, this is an SBA-specific document that confirms the franchise agreement meets SBA eligibility rules. It's a required part of the loan application.
What it means in a deal
Not all franchises are SBA-eligible. The Franchise Addendum, completed by the franchisor, certifies their agreement doesn't contain any clauses that violate SBA regulations. Your lender will require this form if the franchise isn't already listed on the SBA Franchise Directory.
Official sources
13 CFR Part 120 — Business Loans
Office of the Federal Register · Federal regulation
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Franchise Addendum
- If a franchise agreement is listed on the SBA Franchise Directory but has an addendum or rider, how does a lender assess its eligibility?
- If I acquire a franchise, does the SBA approve the specific franchise location?
- What if a franchise agreement is not listed on the SBA Franchise Directory?
- What due diligence is required for a franchise not on the SBA Franchise Directory?
- How does a lender confirm a franchise is listed on the SBA Franchise Directory?
- If I am buying a franchise, does the SBA need to approve the franchise system?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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