What to expect in the Main Street Lending Program

By Jeff Stamm

Jeff Stamm is a director in the Transaction Services practice and leads the Financial Due Diligence group for Daszkal Bolton

Through the Main Street Business Lending Program, the U.S. Treasury will make a $75 billion equity investment to enable up to $600 billion in new financing for medium-sized businesses.
The program is designed for businesses with up to 10,000 employees or $2.5 billion in 2019 revenues. The program encompasses two types of loans, both with interest rates capped at 2% and amortization of principal and interested deferred for 1 year:

Main Street New Loan Facility: Maximum loan size is the lesser of (i) $25 million, or (ii) an amount that, when added to the borrower’s existing outstanding and committed by undrawn debt, does not exceed four times the borrower’s 2019 EBITDA.

For Main Street Expanded Loan Facility Loans: Maximum loan size that is the lesser of (i) $150 million, (ii) 30% of the borrower’s existing outstanding and committed but undrawn bank debt, or (iii) an amount that, when added to the borrower’s existing debt, does not exceed six times the borrower’s 2019 EBITDA.

While details surrounding the application process are still being established, companies interested in participating in the Main Street Lending Program should begin by first reviewing the operational restrictions imposed as a result of receiving a Main Street Loan Program. These restrictions, which are set forth in the CARES Act, include:

  • During the term of the loan and for 12 months thereafter, the company cannot (i) repurchase any stock traded on a national exchange absent a contractual obligation, or (ii) make any dividends or distributions on its common stock
  • None of the company’s executives whose total compensation exceeded $425,000 in 2019 may receive any compensation increases (determined on a rolling 12-month basis) during the term of the loan or any severance that exceeds two times such executive’s 2019 compensation
  • None of the company’s executives whose total compensation exceeded $3 million in 2019 may receive, at any point during the term of the loan, total compensation (determined on a rolling 12-month basis) in excess of the sum of $3 million plus 50% of the executive’s 2019 compensation


In addition, the company should be prepared to attest to the following:

  • It commits to refrain from using eligible loan funds to repay other loan balances and will not seek to reduce or cancel its loans or lines of credit with any lender. Other debt of equal or lower priority cannot be repaid during the term of the eligible loan, except for mandatory principal payments.
  • It requires the eligible loan as a result of the impact of the COVID-19 pandemic, and during the term of the eligible loan, it will make “reasonable efforts” to maintain its payroll and retain its employees.
  • It meets the applicable EBITDA ratio condition based on the facility in which it is participating.
  • It will comply with the distribution, stock repurchase and executive compensation restrictions set forth in the CARES ACT and as described above.
  • It is eligible to participate under the conflicts of interests rules prohibiting the president, his family members and members of Congress from participating.


Companies should also begin to accumulate the following documentation (Note: actual documents required will vary by lender and the extent of such has not yet been established. This preliminary listing of anticipated items is not meant to be comprehensive):

  • Articles of Incorporation showing the company is incorporated in the US
  • Shareholder agreements and any employment agreements for highly compensated individuals
  • Documentation supporting employee headcount is less than 10,000
  • 2019 financial statements and tax returns (2018 tax returns if 2019 is not yet filed)
  • Details of existing debt facilities and associated terms and covenants
  • Budget/forecast for 2020 and 2021, including plan for usage of funds received


 Jeff Stamm at is a director in the Transaction Services practice and leads the Financial Due Diligence group for Daszkal Bolton. He specializes in producing quality of earnings reports in support of buy and sell-side M&A transactions and other capital raising activity. He invites readers with questions to contact him at Jeff@dbllp.com



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Drew Limsky

Drew Limsky



Drew Limsky joined Lifestyle Media Group in August 2020 as Editor-in-Chief of South Florida Business & Wealth. His first issue of SFBW, October 2020, heralded a reimagined structure, with new content categories and a slew of fresh visual themes. “As sort of a cross between Forbes and Robb Report, with a dash of GQ and Vogue,” Limsky says, “SFBW reflects South Florida’s increasingly sophisticated and dynamic business and cultural landscape.”

Limsky, an avid traveler, swimmer and film buff who holds a law degree and Ph.D. from New York University, likes to say, “I’m a doctor, but I can’t operate—except on your brand.” He wrote his dissertation on the nonfiction work of Joan Didion. Prior to that, Limsky received his B.A. in English, summa cum laude, from Emory University and earned his M.A. in literature at American University in connection with a Masters Scholar Award fellowship.

Limsky came to SFBW at the apex of a storied career in journalism and publishing that includes six previous lead editorial roles, including for some of the world’s best-known brands. He served as global editor-in-chief of Lexus magazine, founding editor-in-chief of custom lifestyle magazines for Cadillac and Holland America Line, and was the founding editor-in-chief of Modern Luxury Interiors South Florida. He also was the executive editor for B2B magazines for Acura and Honda Financial Services, and he served as travel editor for Conde Nast. Magazines under Limsky’s editorship have garnered more than 75 industry awards.

He has also written for many of the country’s top newspapers and magazines, including The New York Times, Washington Post, Los Angeles Times, Miami Herald, Boston Globe, USA Today, Worth, Robb Report, Afar, Time Out New York, National Geographic Traveler, Men’s Journal, Ritz-Carlton, Elite Traveler, Florida Design, Metropolis and Architectural Digest Mexico. His other clients have included Four Seasons, Acqualina Resort & Residences, Yahoo!, American Airlines, Wynn, Douglas Elliman and Corcoran. As an adjunct assistant professor, Limsky has taught journalism, film and creative writing at the City University of New York, Pace University, American University and other colleges.