• The period of time in which a loan recipient has to spend the PPP loan funds was extended from 8 weeks to 24 weeks;

• The 25% cap that the Treasury Department placed on forgiveness of non-payroll expenditures has been changed to 40%, but an employer is now required to spend at least 60% of the total loan amount on payroll costs to be eligible for any forgiveness;

• Employers now have until December 31, 2020, to rehire employees and avoid reduction in the potential forgiveness amount; and

• Any unforgiven loan proceeds will have a minimum repayment term of 5 years.

• Dealer A had a monthly payroll expense of $200,000 in 2019.

• The amount of Dealer A’s PPP loan was $500,000 ($200,000 x 2.5).

• During the 24 weeks after receipt of the PPP loan, Dealer A employed only 60% as many employees as in 2019 or the 1^st quarter of 2020 (but each remaining employee continued to earn an annual salary or hourly wage of at least 75% of what was earned in the 1^st quarter of 2020), such that Dealer A’s monthly payroll expense was $120,000.

• For the 24 weeks after receipt of the PPP loan Dealer A’s payroll expense was approximately $660,000.

• For the 24 weeks after receipt of the PPP loan Dealer A paid $35,000 a month in other eligible expenses (utilities, rent, and mortgage interest), for a total of approximately $192,500.

• Dealer A’s total potential forgiveness is $852,500 ($660,000 + $192,500).

• Even when the potential forgiveness of $852,500 is reduced because of the 40% reduction in employee count, the forgivable amount is $511,500 ($852,500 x .60), more than the original loan amount of $500,000.

• Dealer A will receive complete forgiveness of the full amount of its $500,000 PPP loan.