LOANS FOR PLANT ACQUISITION, CONSTRUCTION, CONVERSION, AND EXPANSION.

SEC. 221. LOANS FOR PLANT ACQUISITION, CONSTRUCTION, CONVERSION, AND EXPANSION. Section 502 of the Small Business Investment Act of 1958 (15 U.S.C. 696) is amended— (1) by striking paragraph (1) and inserting the following: “(1) Use of proceeds.— The proceeds of any such loan shall be used solely by the borrower to assist 1 or more identifiable small business concerns and for a sound business purpose approved by the Administration.”; (2) in paragraph (3), by adding at the end the following: “(D) Seller financing.— Seller-provided financing may be used to meet the requirements of subparagraph (B), if the seller subordinates the interest of the seller in the property to the debenture guaranteed by the Administration. “(E) Collateralization.— The collateral provided by the small business concern shall generally include a subordinate lien position on the property being financed under this title, and is only 1 of the factors to be evaluated in the credit determination. Additional collateral shall be required only if the Administration determines, on a case-by-case 111 STAT. 2604basis, that additional security is necessary to protect the interest of the Government.”; and (3) by adding at the end the following: “(5) Limitation on leasing— In addition to any portion of the project permitted to be leased under paragraph (4), not to exceed 20 percent of the project may be leased by the assisted small business to 1 or more other tenants, if the assisted small business occupies permanently and uses not less than a total of 60 percent of the space in the project after the execution of any leases authorized under this section.”.