Glossary · Your money in the deal
Warrant
In short
A security that gives the holder the right to purchase the underlying stock of a company at a fixed price and time, similar to an option but typically issued by the company itself.
What it means in a deal
If the business you're acquiring has outstanding warrants, these represent a potential future dilution of equity if exercised. In a stock purchase, you must account for these. Ensure the purchase agreement clarifies how any existing warrants will be treated, whether they are canceled, exercised, or assumed.
Related terms
Common questions about Warrant
- How does ownership of options or warrants affect affiliation determination for SBA size standards?
- What specific representations and warranties must a lender make when selling the guaranteed portion of a 7(a) loan?
- What specific representations and warranties does the SBA expect in a purchase agreement for a change-of-ownership loan?
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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