If You Don’t Like the PPP Now, Wait a Few Minutes…Major Changes to PPP Loan Program as Congress Passes Payroll Protection Program Flexibility Act

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The Flexibility Act makes several key changes to the PPP program in order to allow borrowers who need a longer re-opening runway to do so without jeopardizing their ability to qualify for loan forgiveness.

July 27, 2020
Ryan J. Udell & Adam J. Chelminiak - White and Williams LLP

On June 5, 2020, President Trump signed into law the Payroll Protection Program Flexibility Act of 2020 (the Flexibility Act). The Flexibility Act provides much-needed flexibility for the Paycheck Protection Program (PPP) and its millions of business participants.

The PPP offers loans to small businesses that have been adversely impacted by the COVID-19 pandemic and the measures taken by various governmental authorities to stem the spread of the virus so that they could keep their employees on the payroll during an eight-week period after receiving the funds. The PPP was particularly alluring to borrowers because the loans could be forgiven. But as the duration of lockdown orders and the accompanying economic aftershocks have extended longer than initially anticipated, particularly in those sectors that depend on in-person business such as restaurants, hospitality and other “main street” retail establishments, many recipients of PPP loans have found it challenging to use the PPP funds for payroll and other authorized purposes within the eight-week period after they had received the PPP funds, as is necessary to preserve eligibility for forgiveness. The Flexibility Act makes several key changes to the PPP program in order to allow borrowers who need a longer re-opening runway to do so without jeopardizing their ability to qualify for loan forgiveness.

This alert outlines the key changes to the PPP made by the Flexibility Act.

Reprinted courtesy of Ryan J. Udell, White and Williams LLP and Adam J. Chelminiak, White and Williams LLP
Mr. Udell may be contacted at udellr@whiteandwilliams.com
Mr. Chelminiak may be contacted at chelminiaka@whiteandwilliams.com;



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