Listmates, I have a family friend looking for an attorney well versed in SBA Loans. The facts and circumstances are provided below: Background: An LLC, a New York-based custom metal fabrication company founded in 2012. During COVID, the business received an SBA Economic Injury Disaster Loan (EIDL) in the amount of approximately $67,400. Due to prolonged business hardship, the loan became delinquent and was eventually transferred to Treasury collections. With penalties, fees, and interest, the balance increased to approximately $101,000. The business submitted a hardship request to Treasury explaining ongoing financial distress and requesting that the balance be reduced to the original loan amount. Treasury agreed to reduce the balance to approximately $60,000 on the condition that it be paid in full within one year. Unfortunately, the business does not have the financial capacity to satisfy that repayment requirement. Relevant facts: * Borrower: LLC (New York LLC) * Original EIDL loan amount: approximately $67,400 * Current Treasury settlement offer: approximately $60,000 if paid within one year * Business remains operational but is struggling significantly * Business has few, if any, meaningful assets * Applications for both a home equity loan and business line of credit have been denied (documentation available) * The loan documents include a security agreement granting SBA a lien on business assets * We have not identified a separate personal guaranty agreement in the loan package, but would like legal review regarding whether the owner may nevertheless have personal liability under the loan documents Primary questions: 1. Does the owner have personal liability under the EIDL loan documents? 2. What options exist for negotiating further with Treasury given demonstrated inability to pay? 3. Would dissolution of the LLC provide meaningful protection if no personal guarantee exists? 4. If personal liability exists, what bankruptcy or restructuring options should be considered? 5. Are there any Treasury, SBA, hardship, settlement, or Offer in Compromise programs that may be available in these circumstances? Sincerely, Dominick J. Callegari ______________________________________ Dominick J. Callegari, Esq. President CALLEGARI LAW, P.C. 4 West Main Street Suite 212 Bay Shore, NY 11706 Ph: 1 (516) 820-0712 Email: dc@callegarilawpc.com<mailto:dc@callegarilawpc.com> www.callegarilawpc.com<http://www.callegarilawpc.com/> [cid:image003.png@01DD032C.35B399B0] _________________________________________________________________________ Federal law requires us to advise you that communication with our office could be interpreted as an attempt to collect a debt and that any information obtained will be used for that purpose. CONFIDENTIALITY NOTICE: This e-mail and the documents accompanying this transmission contain confidential information belonging to the sender which is legally privileged. The information is intended only for the use of the individuals or entities named above. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this e-mailed information is strictly prohibited. If you have received this e-mail in error, please immediately notify the sender by e-mail at the address above. The transmission is to be deleted and any items that may have been printed are to be destroyed. Thank you for your compliance. DISCLAIMER: This message is intended for the above named person(s) only and is CONFIDENTIAL AND PROPRIETARY. If you are not the intended recipient of this e-mail and have received it in error, please immediately notify the sender by return email and then delete it from your mailbox. This message may be protected by the attorney-client privilege and/or work product doctrine. Accessing, copying, disseminating or re-using any of the information contained in this e-mail by anyone other than the intended recipient is strictly prohibited. Finally, you should check this email and any attachments for the presence of viruses, as the sender accepts no liability for any damage caused by any virus transmitted by this email. This communication was not intended or written to be used, and it cannot be used by any taxpayer, for the purpose of avoiding tax penalties. (The foregoing legend has been affixed pursuant to U.S. Treasury Regulations governing tax practice.)