Paycheck Protection Program Flexibility Act – Updates To The PPP

Overview

On June 5, 2020, the President signed the Paycheck Protection Flexibility Act of 2020 (the "Act"), which modifies certain provisions of the Coronavirus Aid, Relief and Economic Security Act (the "CARES Act") enacted on March 27, 2020. The Act makes certain terms of the Paycheck Protection Program ("PPP") more favorable to borrowers. As discussed in our previous alert, the PPP provides forgivable loans up to $10 million to small businesses.  

Key Points

• Extension of Maturity Date for PPP Loans. The Act extends the maturity date from two years to five years for the portion of PPP loans that are not forgiven.These periods begin when the borrower applies for forgiveness of its PPP loans advanced after the date of enactment. For PPP loans advanced prior to enactment, lenders and borrowers may extend the maturity date to the same five-year date.