The Department of Treasury today issued an additional interim final rule regarding the Paycheck Protection Program (the “PPP”) which supplements the First PPP Interim Final Rule.

The additional interim final rule provides clarity on the eligibility of businesses owned by directors or shareholders of a lender.

Specifically, a lender may provide a loan to an otherwise eligible business owned (in whole or part) by an individual who is either:
  •  an outside director of the lender; or
  •  a shareholder who owns less than 30 percent equity interest in the lender.

However, lenders may not prioritize such director’s or shareholder’s applications.

Additionally, lenders are prohibited from making loans to a director’s or shareholder’s business if the director or shareholder is also a key employee or officer of the lender.

The additional interim final rule also includes eligibility requirements for individuals with self-employment income who file a Form 1040, Schedule C and requirements for certain pledges of PPP loans. The full rule can be found here.

Bowles Rice continues to closely monitor federal, state and local developments related to the novel coronavirus pandemic. Be sure to visit the COVID-19 Response Team page on our website for a comprehensive listing of available services.

For more information:
If you have questions about the PPP or would like more information, please contact one of the following Bowles Rice attorneys: