Further Clarification Given On U.S. Paycheck Protection Program (PPP)

In submitting an application for a Paycheck Protection Program (PPP) loan application, applicants make a certification that "[c]urrent economic uncertainty makes this loan request necessary to support the ongoing operations of the Applicant." On April 23, the Small Business Administration (SBA), in consultation with the Department of the Treasury, posted Frequently Asked Question #31 which clarified that borrowers must make this certification in good faith, taking into account their current business activity and their ability to access other sources of liquidity sufficient to support their ongoing operations in a manner that is not significantly detrimental to the business. Question #31 went on to clarify that it is unlikely that a public company with substantial market value and access to capital markets will be able to make the required certification in good faith, and such a company should be prepared to demonstrate to SBA, upon request, the basis for