Summary of the Paycheck Protection Program Under the CARES Act

The Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law on March 27, 2020. Among other benefits, it provides $349 billion in Paycheck Protection Program (“PPP”) loans for small businesses that meet certain criteria. Prior to the passage of the CARES Act, separate small business loans were offered through the Small Business Administration (SBA) Economic Injury Disaster Loan Program (EIDL). The loans under EIDL are still available and have been expanded by the CARES Act, but, for most companies, the PPP is more friendly and beneficial because the loans can be forgiven and do not require guarantees or collateral. The duration of the PPP is February 15 through June 30, 2020. Please note that the SBA has 30 days to issue further regulations and guidance on PPP loans so eligibility and terms are still subject to change.