Government action & disaster assistance
Federal, state and local governments are undertaking numerous actions and offering several programs to assist small businesses with the direct and indirect effects of COVID-19 on their businesses. Many financial institutions and private parties are providing financial assistance as well.
SECTION 5 OF 8
CARES Act stimulus package
The CARES Act appropriated $349B and created an unlimited program for forgivable, emergency loans to distressed businesses for working capital. The loans are intended to be broadly available and calculated to cover up to 2.5 months of payroll, rent/mortgage, utilities and other existing debt obligations up to a maximum of $10,000,000. The bill expands availability past traditional SBA limits to any business with 500 or fewer employees.
Importantly, the bill waives the traditional affiliation rules that would prevent commonly owned or controlled businesses from applying separately and it does away with the requirement that borrowers show they could not receive credit elsewhere. Program loans are to be nonrecourse and no personal guarantees are required.
ServiceTitan doesn’t give legal advice, but we want our customers to be aware of these developments and to help them comply. Consult your attorney if you have specific questions.