Small Business Lending Facility (Section 1101-1107)/Paycheck Protection Program

• Forgiveness: Portion of loans used to pay employees, rent, interest payments on secured debt obligations (like a mortgage) incurred prior to February 15, and utilities over an eight-week period from date of loan will be forgiven. At least 75% of the forgiven amount must have been used for payroll.

• Application Date: Starting April 3, 2020 until June 30, 2020.

• Loan Term: 2 years.

• Interest Rate: .5%

• Prepayment Penalties: None.

• Secured: Loans are unsecured and will not prime existing debt instruments in terms of payment priority. Will also not require personal guarantees from owners of borrowers.

• Use of Proceeds: Loan proceeds can be used for payroll, rent, mortgage payments, utilities, and sick leave. Can also be used to make interest payments on debt obligations incurred prior to Feb 15. Cannot be used to make (pre-)payment of principal of existing debt obligations.

• Maximum Loan Amount: Lesser of...

  • $10,000,000
  • 250% of aggregate monthly payroll

• Deferment of Interest Payments: Principal, interest and fees can be deferred for 6 months.

• Reimbursement for Underwriting/Origination Fees: SBA will reimburse lenders for amount of

  • 5% for loans < $350,000
  • 3% for loans > $350,000 and < $2,000,000
  • 1% for loans ≥ $2,000,000

Information Sheet re: the Payroll Protection Program