Glossary · People and paperwork
Mentor-protégé agreement
In short
A formal agreement under an SBA program where an experienced business (mentor) helps a smaller, often disadvantaged business (protégé) grow. This can create affiliation for SBA size standard purposes between the two businesses.
What it means in a deal
If the target business is a protégé, or if you, as the buyer, own a business acting as a mentor, this agreement creates affiliation. The SBA combines the size of both the mentor and protégé for size standard calculations. Understand the terms and potential impact on loan eligibility.
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 Mentor-protégé agreement
- How does life insurance effectively fund a business buy-sell agreement?
- How does the purchase agreement structure affect an SBA partner buyout?
- How does an operating agreement impact an SBA partner buyout loan?
- What happens if the seller terminates the purchase agreement mid-process?
- What are the specific conditions for an acceptable full standby agreement?
- What if a franchise agreement contains provisions for indemnification that concern the SBA?
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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