Glossary · Doing the deal
Post-Closing Consulting Agreement
In short
This is an agreement where the seller stays on for a period after closing to provide consulting services to the buyer. It's often used to ensure a smooth transition of operations and customer relationships.
What it means in a deal
A Post-Closing Consulting Agreement can be structured to support the buyer's transition, but the SBA has strict rules. Payments to the seller under such an agreement cannot be disguised debt or excess compensation; they must be for actual, market-rate services. Ensure the agreement's terms are reasonable and documented to avoid issues with the SBA.
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 Post-Closing Consulting Agreement
- Can a seller's post-closing consulting agreement influence the standby status of their seller note?
- Can the seller's post-closing consulting agreement influence the standby status of their seller note?
- Does a seller's post-closing consulting agreement influence their standby note status with the SBA?
- What factors should a lender assess regarding a seller's post-closing consulting agreement in a change of ownership?
- What specific limitations must a lender impose on a seller's post-closing consulting agreement to ensure it does not imply retained control or undue influence?
- Does a full standby seller note prevent the seller from receiving any consulting fees from the business post-acquisition?
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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