THE REAL CHECKLIST TO BE COMPLETED BEFORE SUBMITTING YOUR 8(a) – APPLICATION

Dear Prospective 8(a) Applicant,

Here is our tried and trusted checklist for our 8(a) applicants. Complete and comply with the checklist below and your chances of being 8(a) certified will be increased significantly.

SBA Item 1. A list of current and past Federal and non-Federal awarded contracts within the last 12 months. Include award date, agency/customer name, NAICS code, a description of work, and dollar value.

Provide the above for at least 2 commercial clients or at least 1 government client

Ensure that the revenue from that client providing you with your largest portion of your revenues over the last 12 months does not exceed more than 70% of your total revenue from all clients over for the last 12 months

Ensure that the NAICS code provided in the table is the same primary NAICS code provided in your SBA Form 1010, your SAM profile and your company’s tax return for the most recently completed fiscal year

SBA Item 2. Interim or year-end balance sheet and profit and loss statement no older than 90 days from the application date.

Ensure that the financial statements meet the SBA criteria for determining that your company exhibits a “positive potential for success” as represented by a positive equity, positive working capital, i.e., Current Assets-Current Liabilities>$0, and positive current period earnings, i.e., profitable at the time of the application.

If the statements are provided on an accrual versus cash basis, provide an Accounts Receivable (AR) and Accounts Payable (AP) aging report for the same data represented by the financial statement, ensuring that the amounts shown for AR and AP from the aging reports match the values shown on the balance sheet.

If the balance sheet provided indicates the existence of a loan from or to any individual or organization, provide a complete executed copy of the loan agreement and include it in Item 9.

SBA Item 3. Copies of the last three years of the Applicant Firm’s filed Federal tax returns including all schedules and attachments.

Provide the above appropriately signed taxes, i.e., Federal taxes ONLY for the last 3 years. If you have yet to file your taxes for the most recently completed tax year, provide a copy of the Request for Tax Filing Extension.

If taxes show that there was money owed at the end of ANY of the above tax years, you must provide proof of the tax payment or alternatively provide a copy of the tax repayment plan with the IRS and also proof that you are in compliance with the payment terms of this tax repayment plan.

If the Business Activity Code shown on your company tax return does not match the NAICS Code shown on your SBA Form 1010, Sam profile or List of Contracts, i.e., Item 1 above, then you must secure and provide a letter from your tax preparer that indicates that the Business Activity Code was entered in error by him/her and identify the correct code.

SBA Item 4. Copy of firm’s current Certificate of Good Standing (for Corporations or LLCs, if applicable), or similar document, from the state where the applicant firm is incorporated/organized.

The Certificate must be no older than 90 days from the date that the application is provided to the SBA.

If the company was organized in a state, but operates out of a different state, these certificates must be provided from each state in which the company has an operating location.

SBA Item 5. Copies of the last three years of filed Federal tax returns, including all schedules and attachments, for all of the Applicant Firm’s acknowledged affiliates. SBA criteria for defining affiliates should be carefully reviewed and can be found at 13 CFR & 121.103

Provide the above appropriately signed taxes, i.e., Federal taxes ONLY for the last 3 years for both you and your spouse, if married. If you have yet to file your taxes for the most recently completed tax year, provide a copy of the Request for Tax Filing Extension.

If any of the tax schedules provided show the existence of another business, then, you must provide proof that that business is either owned by your spouse and provide necessary documentation to prove that fact, e.g., corporate governance documentation clearly showing that, such as stock certificates, operating agreement, etc., or indicate why your ownership in that business does not interfere with your effective day-to-day operations of the applicant firm.

If the Schedule B from your IRS Form 1040 indicates that you have a financial interest in or signature authority over a financial account, such as a bank account, securities account, property or business located in a foreign country, you must identify and reflect this ownership in your Personal Financial Statement, SBA Form 413. Further, if your foreign holdings include ownership in another business, you will have to explain to the SBA that this outside ownership does not negatively affect the day-to-day operations of your applicant firm.

SBA Item 6. Copies of all stock certificates (front and back), stock ledgers, registers, any transmutation agreement (for community property states), and any voting agreements.

Complete copy of all outstanding or issued signed stock certificates, both front and back, signed by the President and Secretary of the corporation

If any of the stocks has been sold or transferred to another individual, the back of the respective certificates must be completed and signed by the individual transferring the certificate.

The stock ledger must match precisely with the data contained in the issued stock certificates.

If you live in any community property state, Arizona, California, Idaho, Louisiana, New Mexico, Texas, Washington, Wisconsin, and Puerto Rico, You must provide a copy of Transmutation Agreement to ensure, that if you are married, your spouse cannot prevent you from owning the controlling interest in your applicant firm.

SBA Item 7. Copies of all business bank account signature cards. In lieu of this, a letter from the bank identifying all individuals with signatory authority on all bank cards will suffice.

If the business bank signature card includes any additional signatures, the rationale for this must be provided and the additional signatories must provide an executed copy of an SBA Form 912, Statement of Personal History.

Bank signature cards must be provided for each and every bank account, e.g., savings, checking, etc., held by the applicant firm.

SBA Item 8. Copies of business and special licenses under which the Applicant Firm operates. This included industry related licenses. Include the name(s) of the qualifying party/individual.

If your city, county or town requires a local business license you must provide it.

If the business area in which the firm operates requires a special license, e.g. plumbing, electrical, professional engineering, etc. you must provide a current license and also the name of the individual who qualified the firm to hold the license

If that individual that qualified the company for the special license is not the applicant, then the SBA will likely deny the application, alleging that that individual can exercise control of the form and the applicant.

SBA Item 9. Copies of Applicant Firm’s current loan agreements, including lines of credit and shareholder loan(s). Provide all loan sources, amounts, purposes of money loaned, name(s) of any persons/firms securing the loan and the name(s) of the qualifying party/individual.

You must provide a complete copy of any and all loan agreements that appear on the most current or interim balance sheet provided to the SBA in conformance with Item 2 above.

SBA Item 10. Copies of buy/sell agreements, shareholder agreements or other similar arrangements which may impact the unconditional ownership of the disadvantaged individuals.

You must provide copies of any and all agreements affecting the ownership of the applicant firm that have occurred within the last wo years preceding the date of the 8(a) application

You must provide copies of the applicant firm’s meeting minutes that indicate the approval of any buy/sell, shareholder or changes in ownership and control by the applicant.

SBA Item 11. List of all contributions or transfers of assets to/from. The Applicant Firm and to/from any of its owners over the past two years. Include dollar value, from whom transferred, to whom transferred, relationship between the parties, date of transfer and copies of any supporting documents and agreements.

Ensure that the value of the transferred assets are reflected on the transferor’s personal financial statement if the transfer occurred within 2 years of the date of the application

SBA Item 12. Copies of all management and joint venture agreements, to include any mentor-protégé agreements, teaming agreements, indemnity agreements and consulting agreements, including agreements for assistance in completing this 8(a) BD application.

If you do use a consultant to assist in preparing your 8(a) application, provide a complete signed copy of this agreement and proof that you paid this consultant in accordance with the terms in the agreement,

SBA Item 13. Copies of all statements of bonding ability from the Applicant Firm’s surety specifying single job limit and aggregate limit, if applicable for the firm’s primary industry (construction or engineering).

Ensure that the bond is active and held by the applicant firm.

SBA Item 14. A completed Individual Information Form (SBA Form 1010-IND), SBA Form 912, and all supporting documents required by those forms for each individual owning at least 10% or more of the business and each director, management member, partner, and officer.

You must provide a written rationale and details to explain every positive, i.e.,Yes response to any question on the SBA Form 1010-IND.

If the applicant was born outside of the U,S., he or she must provide proof of citizenship in the form of a U.S. Passport or Certificate of Naturalization.

If you have answered Yes to any of the questions in blocks 7, 8, or 9 of the SBA Form 912, Statement of Personal History, you must provide complete details as described on the SBA Form 912 and also copies of all court records associated with the incident. Also, do not forget to initial blocks 5,7, 8 and 9 of the SBA For, 912.

SBA Item 15. A completed Personal Financial Statement (SBA Form 413) for all individuals claiming economic disadvantage to qualify the Applicant Firm and for those individual’s spouses.

Ensure that you have backup statements (No older than 30-60 days old from the date of the application) that match precisely the personal assets and liabilities that you enter onto your and your spouse’s SBA Form 413, Personal Financial Statement. Be prepared for the SBA to ask you to provide this back-up information.

Include a calculation of your adjusted Net worth as part of this item, using our Adjusted Net Worth Worksheet as an example, to convince the SBA and you that you are in compliance with the $4M in personal assets and $250K in net worth after allowable deductions.

If you or your spouse indicate any IRA & Other Retirement Accounts, provide a recent statement attesting to the value of each retirement account and also provide a copy of the plan document associated with each retirement plan, highlighting the language within the plan that states clearly that there will be a penalty, e.g., 10% in taxes for early distribution of the funds from these plans before the normal age of retirement stated in the plan, e.g., 59 ½.

SBA Item 16. Copies of the Applicant Firm’s governing documents, as applicable (see below):

For Corporations: Articles of Incorporation (original and current version), Bylaws (current version), and the most recent Stockholder and/or Board Member Meeting Minutes showing the election of officers and directors, if applicable.

For Limited Liability Companies: Articles of Organization (original and current version), Operating Agreement (current version); resolution or other documentation designating officers, directors, and members representative, management committee members, and/or general managers as required by the business concern’s governing documents (if not included in the Operating Agreement).

For Partnerships: Partnership Agreement

For Sole Proprietorships: Copies of Fictitious Business Name Filing.

The Operating Agreements for Limited Liability companies or the Bylaws for corporations must indicate that the applicant has complete and unconditional control over all strategic and day-to-day operations of the applicant firm. If not, these corporate governance documents must be amended and seen as approved by the applicant in the most recent set of organizational or annual meeting minutes.

The Shareholder, Director and Member Meeting minutes, in addition to the election of officers and directors, must also approve any amendments to the associated bylaws or Operating Agreement and also approve the application to the SBA for participation in the 8(a) - program.

SBA Item 17. Resumes for all individuals claiming social and economic disadvantage to qualify the Applicant Firm and day-to-day managers of entity-owned firms.

Provide a resume that shows your current position in the applicant firm, your roles and responsibilities, your dates of employment at each firm that you have worked at, together with your title and roles at each firm that you have worked at, back to your first job, if at all possible.

Ensure that as a minimum, your resume identifies all employers that are reflected in the last 3 years of taxes that yo provided in compliance with Item 5 above.

PLEASE NOTE:

The 17 items identified by the SBA above are ONLY the tip of the iceberg!

We are here to help, and are committed to your success, since we also personally know the value of this program, and would like to help you be a part of it just like I was years ago. If you have any questions about the items on the checklist, feel free to reach out: 703-966-5560.

Interested? Call me at 703-966-5560 to discuss your particular situation and the terms of my NEW 8(a) Application Preparation Service.

As always, I will only accept you as my client, if you are 100% qualified by me, at no cost or obligation to you, to proceed.

Rocket speed, a 50% discount, will respond to any SBA challenges, and guaranteed results! It doesn’t get any better than this! Call me at 703-966-5560.

NO MORE EXCUSES. LET’S GET THIS ON AND GET 8(a) CERTIFIED!

Sincerely,

Richard J. Otero, Sr.
President

Otero, LLC

703-966-5560 (Cell)

410-672-6904 (Office)

Email: wilmaxllc1@aol.com

Web Address:

www.The8aAuthority.com

wilmaxllc1@aol.com

Contact Me:

(410) 672-6904

Otero, LLC

8606 Wintergreen Court, Suite 207

Odenton, Maryland 21113