Overview

Action Item

On April 30, 2020, the Federal Reserve released updated term sheets for the Main Street New Loan Facility (MSNLF) and the Main Street Expanded Loan Facility (MSELF) and introduced the Main Street Priority Loan Facility (MSPLF). These programs are intended to facilitate lending to small and medium sized businesses. MSNLF and MSPLF loans are term loans originated after April 24, 2020, while MSELF loans are provided as upsized term loan tranches of existing term loans or revolving credit facilities originated on or before April 24, 2020 with a remaining maturity of at least 18 months. The combined size of the program will be up to $600 billion.

The April 30, 2020 term sheets released by the Federal Reserve introduced the MSPLF and made several critical modifications to the previously announced terms of the MSNLF and MSELF. Most notably, the updated term sheets reduced the minimum amount of MSNLF loans from $1 million to $500,000, permitted industry-appropriate adjustments in the calculation of EBITDA for eligibility and maximum loan purposes, and expanded eligibility requirements to include certain larger mid-sized businesses. Interested borrowers should contact lenders for information whether such lenders intend to participate in any of the Facilities and, if so, to request information on the application process.

To view a summary of the principal terms of the programs, reflecting guidance available as of April 30, 2020, visit: main-street-lending-programs-summary. Note these terms are subject to additional guidance and change.

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COVID-19 Resources

We recommend you evaluate the following pandemic-related business and legal considerations that we have been discussing with our clients:

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