UPDATE: This article has been revised to reflect clarification provided by SBA on determining whether a minimum equity injection is required for a partner buyout. On April 3, 2018 SBA…
SOP 50 10 5(J), Subpart B, Chapter 4 provides the following: When a substantial portion of the loan proceeds are to be used for leasehold improvements or a substantial portion…
SBA loan proceeds are frequently used to finance change of ownership transactions. Such change of ownership can be accomplished through either a stock purchase (or redemption) or through a purchase…
We have written previously on the Small Business Administration’s increased use of the federal False Claims Act (“FCA”) against lenders who fail to follow the SBA’s Standard Operating Procedures (“SOPs”)…
Lenders extending Small Business Administration (“SBA”) loans have now been operating under SOP 50 10 5 (J) since January 1, 2018. As most SBA lenders are aware, SOP 50 10…
On April 3, 2018 SBA issued Policy Notice 5000-17057. It provides guidance on different matters related to SOP 50 10 5(J) which became effective on January 1, 2018. Two significant…