Glossary · People and paperwork
Ownership Structure
In short
How a business is legally organized and who owns what percentage (e.g., sole proprietorship, LLC, corporation). This dictates how the business is bought and managed.
What it means in a deal
Understanding the seller's ownership structure is critical because it determines whether you're doing an asset purchase or a stock purchase. Your SBA lender will review the ownership structure to identify all "key principals" and guarantors. Verify all owners are properly identified and agree to the sale terms.
Official sources
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.
Related terms
Common questions about Ownership Structure
- If I am buying out a partner, what is the minimum equity injection required for the new ownership structure?
- How does the purchase agreement structure affect an SBA partner buyout?
- Can I change my business structure after getting an SBA 7(a) loan?
- How does seller financing structure impact the required equity injection for a business acquisition?
- Are there specific requirements for the business entity structure for an SBA 7(a) loan?
- Does my business legal structure (like LLC or Sole Proprietorship) affect SBA 7(a) loan eligibility?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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