Glossary · Doing the deal
Stock purchase(equity purchase)
In short
Buying the company itself, ownership papers and all. Required for partial buyouts.
What it means in a deal
A stock purchase transfers the shares of the existing legal entity rather than its individual assets. You inherit everything — assets, liabilities, contracts, and any unknown surprises buried in the company's history. Representations and warranties in the purchase agreement protect you from known issues, but stock purchases generally carry more risk than asset deals. The SBA allows stock purchases but requires additional documentation for the change-of-ownership file.
Official sources
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-16. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Stock purchase
- What is the difference between an asset and stock purchase in a buyout?
- What if the value of my stock portfolio (for equity injection) drops before closing?
- Can an SBA 7(a) loan be used to buy stock or passive investments?
- What documentation is required to verify equity injection funds sourced from a personal stock sale?
- Does an unfunded stock option agreement trigger affiliation for SBA 7(a) size standard calculations?
- When does common ownership by an Employee Stock Ownership Plan (ESOP) trigger affiliation for size determination?
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 2026-06-16 · 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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