Skip to content
BOL Conferences
Thread Options
#2163175 - 02/05/18 09:46 PM Reg O
bowlngirl Offline
Junior Member
Joined: Sep 2008
Posts: 27
Would Reg O apply to the following situation? A Director is a guarantor on a loan for ABC LLC. He is also a 50% owner of XYZ LLC which owns 52% of ABC LLC.

Return to Top
Lending Compliance
#2163182 - 02/05/18 09:56 PM Re: Reg O bowlngirl
rlcarey Online
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,371
Galveston, TX
Since the director guaranteed the loan, any ownership question is moot. The loan amount is 100% attributable to the director.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2163349 - 02/06/18 08:17 PM Re: Reg O bowlngirl
bowlngirl Offline
Junior Member
Joined: Sep 2008
Posts: 27
To carry this a little further, the loan was made prior to the individual becoming a director mid year. Lines of credit are authorized in January each year. Would anything need to be reported to the board prior to all lines to insiders being reviewed and being authorized the following January? No new credit has been extended.

Return to Top
#2163580 - 02/07/18 11:01 PM Re: Reg O bowlngirl
rlcarey Online
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,371
Galveston, TX
The only thing that happens on loans that exist when they become an insider is that if they are over any specific insider lending limit, those are grandfathered until the time or renewal or refinance and no new debt may be extended until they are under any specific limit. Otherwise, it is still a director's related interest loan at this point for reporting purposes.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top

Moderator:  Andy_Z