The Paycheck Protection Program (PPP) under Title I of the CARES
Act was established on March 27, 2020 to provide financial relief
for small businesses adversely affected by COVID-19. The
CARES Act initially allocated $349 billion to the PPP but on
April 15, 2020, the SBA announced that it was no longer able to
accept new applications based on existing appropriations. On
Thursday, April 23, 2020, Congress passed a relief package that
provided the PPP with an additional $310 billion in funding.
For more information on eligibility and permitted uses of PPP
proceeds, see SBA Loans Under the CARES Act.
In their understandable haste to secure PPP funding, many
borrowers and lenders may not have worked through all legal and the
operational issues relating to those loans and their impacts on
existing credit documents. If they have not done so already,
such borrowers and lenders should consider the following and work
through these issues in a constructive manner to
