SBA 7(a) Q&A
Short answer
The purchase agreement is a critical document that dictates the buyout's terms, including price, assets, liabilities, and closing conditions, all affecting SBA approval.
The purchase agreement formally outlines the entire transaction, specifying what is being bought (shares), the purchase price, payment terms, representations and warranties, and conditions precedent to closing. The SBA and lenders rely on this document to understand and approve the change of ownership.
A purchase agreement for a 50% partner buyout would detail the $750,000 purchase price, specify it's a stock purchase, list the conditions for closing (e.g., SBA loan approval, no material adverse changes), and allocate liabilities between buyer and seller.
Lenders meticulously review the purchase agreement for clarity, completeness, and compliance with SBA requirements. They ensure all aspects of the transaction, especially the use of loan proceeds and equity injection, are accurately reflected and legally enforceable.
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.
Last reviewed 2026-06-15 · SBA sources checked through 2026-06-15. DealRoom analysis of the current SBA 7(a) rulebook for change-of-ownership / partner buyouts. Grounded in the current SBA rulebook; verify against the official sources above before relying on it for a live deal. Not legal, tax, or financial advice, and not an approval decision.
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