{"ok":true,"canonical_url":"https://dealroom.so/glossary/corporation","api_url":"https://dealroom.so/api/public/glossary/corporation","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"corporation","term":"Corporation","group":"People and paperwork","definition":"A legal entity separate from its owners, providing liability protection. This structure affects how the business is bought and your personal risk.","what_it_means":"When acquiring a corporation, you can either buy its assets (asset purchase) or its stock (stock purchase). An asset purchase is common with SBA loans, as it typically avoids inheriting the seller's past liabilities. All owners with 20% or more equity in the acquiring corporation must personally guarantee the SBA loan.","url":"https://dealroom.so/glossary/corporation","official_sources":[{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"},{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"}],"related":[{"slug":"llc","term":"LLC","url":"https://dealroom.so/glossary/llc"},{"slug":"partnership","term":"Partnership","url":"https://dealroom.so/glossary/partnership"},{"slug":"asset-purchase","term":"Asset purchase","url":"https://dealroom.so/glossary/asset-purchase"},{"slug":"stock-purchase","term":"Stock purchase","url":"https://dealroom.so/glossary/stock-purchase"}],"related_questions":[{"question":"Can a foreign corporation own a minority (less than 20%) stake in an SBA 7(a) loan applicant business?","url":"https://dealroom.so/for-lenders/questions/can-a-foreign-corporation-own-a-minority-less-than-20-stake-in-an-sba-7-a-loan-applicant-b"},{"question":"Does my business need to be set up as an LLC or Corporation for an SBA 7(a) loan?","url":"https://dealroom.so/sba-loans/basics/does-my-business-need-to-be-set-up-as-an-llc-or-corporation-for-an-sba-7-a-loan"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Corporation","url":"https://dealroom.so/glossary/corporation","source_type":"DealRoom Data"}}