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Josh French Discusses the SBA's EIDL Program in NOSH
Print PDFJosh French, a partner in Nutter’s Corporate and Transactions Department, weighed in on Economic Injury Disaster Loans (EIDL) and their negative impact on the growth of some companies since the COVID-19 pandemic in NOSH. Noting the need for personal guarantees of anyone holding more than a 20% share of the business and to notify the Small Business Administration (SBA) of any changes in company ownership, Josh addressed the SBA’s process to collect loans. In the article, “Is SBA Bureaucracy Bankrupting Small Business? It’s Not That Simple,” he said, “The SBA has the right to call your loan [if you are in technical default], but realistically, they’re not going to do that unless they actually are afraid that this is a company that’s about to go under, or is about to suffer some other loss that puts its position, vis-a-vis the loan, in a much worse place.”
Furthermore, Josh added, “I don’t think it’s a high priority item to seek out companies that got an EIDL loan and then subsequently took in cash from an investor and used it to grow the business. I don’t see the SBA trying to find these types of businesses that are in technical breach and call their loan, because it’s just going to result in more challenges collecting on that [debt].”
