Paycheck Protection Loan Application Period Extended to August 8, 2020
The Paycheck Protection Program (PPP) was expected to stop accepting loan applications on June 30, 2020, but that date has now been extended to August 8, 2020. Of the $659 billion originally appropriated by Congress to fund the PPP, approximately $130 billion was still available as of the original June 30 expiration date. Borrowers who previously obtained a PPP loan are not eligible for a second loan, even if they repaid their first loan in full.
Under the PPP, qualifying small employers (generally those with 500 or fewer employees, although there are exceptions) and self-employed individuals may obtain forgivable loans of up to $10 million to cover payroll and other qualifying costs if they require the funds to maintain on-going operations. The loans may be forgiven if the borrower satisfies certain conditions, including using at least 60percent of the loan for payroll costs and the remaining percentage on other qualifying expenses. PPP loans are available to for-profit businesses, non-profit organizations and self-employed individuals. Our previous analysis of the PPP program can be found here and here.
The SBA has released the names of PPP loan recipients that received amounts of $150,000 or more, and the media has reported a number of well-known or highly profitable businesses (and charitable organizations) that obtained loans. The data includes the loan amount in ranges only. In spite of the initial confusion surrounding the PPP, there is now greater clarity on how the SBA and the Treasury Department interpret the legislation. Businesses that have not previously received a PPP loan may want to consider applying for a loan. Potential applicants can reach out to any attorney at Saul Ewing Arnstein & Lehr LLP for guidance on the PPP loan process.