SOP 50 10 8 and Minority Investors

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August 25, 2025

by a searcher from George Washington University in Milton, FL 32571, USA

Has the appetite of minority investors decreased with SOP###-###-#### requiring a personal guarantee? I feel like this is a deal breaker for many who would have previously invested. What is everyone's experience? Has this killed any of your deals?
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Reply by a professional
from University of Michigan in Detroit, MI, USA
^redacted‌, ^redacted‌ is correct. If it is an 100% buy out, minority investors (less than 20%) will not need to PG the loan. The rule you are referring to only applies to partial changes of ownership. And yes, in that situation it is making those deals harder to close.
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Reply by a searcher
from University of California, Los Angeles in Tampa, FL, USA
The only way an investor would be required to PG under the new SOP is if there is a partial buyout (in which case the Seller must provide a PG for 2 years also). But so long as it's a complete change of ownership and as Tim said there isn't ownership >20%, then no PG is required of investors
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