On April 30, 2020 the Federal Reserve released new term sheets for the Main Street Loan Program, which is a $600 billion loan program, that will include $75 billion capitalized by the Treasury Department under the $454 billion Congressional appropriation of Section 4003(b)(4) of Title IV of the CARES Act.   The loans will target small and mid-sized companies, defined as having less than 15,000 employees or $5 billion or less in 2019 annual revenue, and will be made by banks and other eligible lenders, with the government then purchasing between 85% to 95% of the lenders’ interest in the loans.

The summary we are releasing today highlights key aspects of, and compares differences between, the three types of loans that will be available under the Main Street Loan Program. On April 16, 2020 the Sheppard Mullin team provided comments to the Federal Reserve on the previous draft term sheets it released for the Main Street Loan program.

The Federal Reserve has not yet announced when the Main Street Loan Program will be formally opened but that is expected soon. Sheppard Mullin is actively assisting borrowers and lenders in analyzing and accessing the funds available under the Main Street Loan Program.

Click here to view full PDF.

As you are aware, things are changing quickly and the aid measures and interpretations described here may change. The summary attached to this post represents our best understanding and interpretation based on where things currently stand as of May 8, 2020.

Photo of Elliot Hinds Elliot Hinds

Elliot Hinds is a partner in the Corporate Practice Group in the firm’s Century City office.

Photo of Peter Carson Peter Carson

Peter Carson is a partner in the Finance & Bankruptcy Practice Group in the firm’s San Francisco office.

Photo of Charbel Lahoud Charbel Lahoud

Charbel F. Lahoud is a partner in the Finance and Bankruptcy Practice Group in the firm’s Los Angeles office.

Photo of Bobby Chipman Bobby Chipman

Bobby Chipman is an associate in the Corporate Practice Group in the firm’s Century City office.

Photo of Nicole Danesh Nicole Danesh

Nicole Danesh is an associate in the Corporate and Securities Practice Group in the firm’s Century City office.