SBA 7A and Preferred Shares

by a searcher from Thunderbird School of Global Management

3 years ago

Does anyone have experience in structuring a deal with a SBA 7a note and preferred shares in order to stay under the 20% PG criteria for investors. Can you share terms you may have provided or rules of thumb to follow. Thanks!

1 like
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2 comments

lender from California State University, Sacramento - College of Business Administration

I can share on a direct call with you how we approach from a Sr debt perspective. --@----.com

3 years ago | like reply | 2 likes

searcher from Georgia Institute of Technology

On a 7a deal I was a part of, we did not have preferred shares. Instead, we provided a preference on all equity investments. Not a liquidation preference because the preference we strucutured is paid out of available cash flow. The preference boosted the return profile while keeping everyone healthily under the 20% threshold.

3 years ago | like reply | 1 like

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