Does SBA Accommodate Earn Outs?

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April 09, 2021

by a searcher from Cornell University in Sunnyvale, CA, USA

I know SBA has lots of quirks. Does anyone know if SBA has any lending restrictions on deals that are structured as earn outs and/or equity rollovers? I’d love to learn from peoples’ stories of success and failure when it comes to SBA loans and earn outs/equity rollovers.

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Reply by an admin
from Stanford University in Honolulu, HI, USA
Hi, ^redacted‌: In addition to the great advice here, we have some terrific live streams with ^redacted‌, ^redacted‌, ^redacted‌, ^redacted‌ and ^redacted‌ on our past events page: https://www.searchfunder.com/event/past Warmly, Karen
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Reply by a searcher
from IESE Business School in Los Angeles, CA, USA
Hi Addison - as ^redacted‌ mentioned, you can structure a forgivable seller note. One of the main caveats is that you can’t make it an earnout in disguise. Am happy to chat about my experience if you’re interested.
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