The Small Business Administration’s (“SBA”) release of an Interim Final Rule on loan forgiveness and an Interim Final Rule on SBA loan review procedures, each under the Paycheck Protection Program (“PPP”), add additional clarity to the PPP loan forgiveness application previously released.  Although the interim final rule promises that it provides “a high degree of certainty to PPP borrowers,” all borrowers should continue to consult their lawyers and accounting professionals as they prepare to apply for loan forgiveness.  Borrowers should remain aware that the official guidance is changing weekly, if not daily.  We continue to note that the applications for PPP loans were revised after being initially provided, and while we have no reason to believe the loan forgiveness application will necessarily be revised at this point, the possibility remains.

The Small Business Administration’s (“SBA”) release of its official loan forgiveness application under the Paycheck Protection Program (“PPP,” Section 1102 of the CARES Act) answered a number of questions that borrowers and their legal and accounting advisers had regarding the program. But the application also leaves some questions unanswered, and borrowers, their lawyers, and their accountants are eagerly awaiting the release of promised loan forgiveness regulations that are expected to be posted online in coming days or weeks on Treasury's website. Borrowers should consult all existing regulations and guidance as they prepare to apply for PPP loans and as they prepare to apply for loan forgiveness. What follows is a high-level discussion of what we have observed in the latest guidance, but borrowers should be aware that the official federal guidance is changing weekly if not daily, and, depending on the complexity of a borrower’s application, consultation with a lawyer or accountant may be vital to ensuring compliance with the program. We also note that the original applications for PPP loans were revised after being initially provided and, while we have no reason to believe the loan forgiveness application will be revised at this point, the possibility certainly exists.

The Coronavirus Aid, Relief, and Economic Security, or “CARES Act”—the third emergency bill that Congress has prepared in response to the Coronavirus (COVID-19) pandemic—was signed into law Friday, March 27, 2020. BCLP lawyers have analyzed the law, including its provision for a Paycheck Protection Program (PPP), and have been advising clients on what impact it may have on their businesses and whether those businesses may be eligible for assistance.