President Biden to Nominate Former CFTC Chair Gary Gensler to Lead the SEC
Seller’s COVID-related actions breached an “ordinary course” covenant, even though the COVID-19 pandemic did not give rise to a “material adverse effect.”
Authored by Michael R. Neidell and Zachary E. Freedman, Law Clerk
On June 8, 2020, the Federal Reserve released additional guidance on the Main Street Lending Program, completely replacing earlier set of FAQs (April 30, 2020 and May 27, 2020) with new FAQs and revised term sheets.
In new guidance issued on April 30, 2020, the Small Business Administration (“SBA”) stated that businesses that are part of a “single corporate group” may not receive Paycheck Protection Program (”PPP”) loans exceeding $20 million in the aggregate for the “single corporate group.” This cap is effective immediately with respect to any PPP loan that has not been fully disbursed by April 30, 2020. This client alert explains the new guidelines and related considerations.
On April 9, 2020, the Federal Reserve announced the details of a new program established under the CARES Act, the Main Street Lending Program, intended to assist small and medium-sized businesses impacted by the COVID-19 pandemic by making up to $600 billion in loans available for eligible borrowers. The program is designed for businesses with up to 10,000 employees or up to $2.5 billion in 2019 revenues. This client alert summarizes the terms of the loans available under this new program.
Despite the continuing coronavirus global pandemic, business marches on, including compliance with applicable regulatory requirements. Regulatory bodies recognize that the reduced staffing, “social distancing” and other factors could hamper efforts to comply with various regulations. The U.S. Securities and Exchange Commission (“SEC”) has acted to ameliorate certain of the burdens publicly traded companies are currently facing. In addition, companies need to take into account the effects of COVID-19 on their businesses and regulatory disclosures, and we have highlighted certain significant considerations in this client alert.
Over the past few months, we have been increasingly asked by our corporate clients with pending IPO registration statements and by publicly traded companies with short-term funding needs to advise them on the spectrum of alternative sources of financing due to the current substantial volatility in stock trading and the resulting virtual standstill in their ability to access active public capital markets.
On October 23, 2013, the U.S. Securities and Exchange Commission (the "SEC") proposed for comment amendments to the Securities Act of 1933, as amended (the "Securities Act"), to implement "Regulation Crowdfunding" in accordance with Title III of the Jumpstart our Business Startups (JOBS) Act.