PPP Loan Forgiveness and Business Sale/Ownership Change

Posted on

If you are thinking of selling or transferring ownership of your business, make sure to contact your Payroll Protection Program (PPP) lender before you do.

If you received a PPP loan and the loan has not yet been forgiven, your PPP lender (and in some cases, the Small Business Administration (SBA)) must review and approve the sale or transfer before the deal closes.  This requirement is triggered for all (a) transfers of 20% or more of the common stock or units in the company; (b) transfers of at least 50% of the business’ assets; and any time (c) the business entity is merged with another entity.

The information the PPP lender (and SBA) will need depends on the type of business sale or asset transfer.  More details are available in this SBA Procedural Notice.  Contact HLG if you need assistance with this or other business sale and transfer details.

Please note that merely sending e-mail to one of our lawyers or our client services department does not create an attorney-client relationship. Such relationship will exist only once it is confirmed in writing between Horenstein Law Group PLLC and you or your company. Please do not send information you deem to be confidential unless or until we establish a formal attorney-client relationship.

The materials on the website are for informational purposes only and not for the purpose of providing legal advice. You should not consider any information on the website as legal advice. You should consult an attorney with respect to advice applicable to your particular situation or issue. By clicking “I ACCEPT” below, you agree that any information you provide, including without limitation name and e-mail address, may be entered into our database.