Main Street Lending Program is now operational

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Main Street Lending Program is now operational

By: Dean Dorton | July 8, 2020

The Main Street Lending Program is now fully operational. Eligible borrowers have access to a variety of loan options depending on whether they operate a for-profit or not-for-profit entity. Find the key terms for the Program here!

COVID-19 | COVID-19 Business | COVID-19 SBA Loan Programs | Uncategorized

Earlier this week, U.S. Treasury Secretary Steven Mnuchin announced the Main Street Lending Program is now fully operational. The Program was established to provide financial support to small and medium-sized businesses affected by the COVID-19 pandemic. Interested borrowers can find additional information about the Program, including a list of participating eligible lenders by state, here.

Eligible borrowers have access to a variety of loan options depending on whether they operate a for-profit or not-for-profit entity. Terms for the Program loan options can be found within the tables below.

General Terms

Forgiveness The loan is not forgivable
Payment Deferral Payments on principal deferred for two years and interest deferred for one year
Prepayment Permitted without penalty
Tax Treatment Treated as indebtedness for tax purposes
Loan Term Five years
Interest Rate LIBOR (1 or 3 month) + 3%
Principal Repayment Year 3: 15%, Year 4: 15%, Year 5: 70%
Lender Risk Retention 5%

Loan Option Specific Terms

For-profit eligible entities

Main Street Lending Loan Options
New Loan Priority Loan Expanded Loan
Loan Amount
Minimum $250,000 $250,000 $10,000,000
Maximum Lesser of $35,000,000 or

4x 2019 adjusted EBITDA

Lesser of $50,000,000 or

6x 2019 adjusted EBITDA

Lesser of $300,000,000 or, when added to the outstanding or undrawn available debt, does not exceed

6x 2019 adjusted EBITDA

Eligible Loans Secured or unsecured term loan originated after April 24, 2020 Secured or unsecured term loan originated after April 24, 2020 Secured or unsecured term loan or revolving credit facility originated on or before April 24, 2020, with a remaining maturity of at least 18 months
Origination Fee 1.00% of the principal amount 1.00% of the principal amount 0.75% of the principal amount related to incremental loan
Transaction Fee* 1.00% of the principal amount 1.00% of the principal amount 0.75% of the principal amount related to incremental loan

 

Non-for-profit (NFP) eligible entities

Main Street Lending NFP Loan Options
NFP New Loan NFP Expanded Loan
Loan Amount
Minimum $250,000 $10,000,000
Maximum Lesser of $35,000,000 or

average 2019 quarterly revenue

Lesser of $300,000,000 or

average 2019 quarterly revenue

Eligible Loans Secured or unsecured term loan originated after June 15, 2020 Secured or unsecured term loan or revolving credit facility originated on or before June 15, 2020, with a remaining maturity of at least 18 months
Origination Fee 1.00% of the principal amount 0.75% of the principal amount related to incremental loan
Transaction Fee* 1.00% of the principal amount 0.75% of the principal amount related to incremental loan

*At the discretion of the lender, these fees may be paid by the borrower.

Email COVID-19 Solutions Team

We can help!

If you are anticipating applying for a Program loan and will need assistance complying with the financial reporting covenant, please email us at COVID19Solutions@deandorton.com.
Email COVID-19 Solutions Team

For more information on how the coronavirus is impacting businesses across multiple industries, visit our COVID-19 resource page:

COVID-19 Resources

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