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Please note that Simmons is continually working to update our resources as new information becomes available.


What is the Paycheck Protection Program (PPP)?

PPP is a quick relief loan program aimed at helping businesses impacted by the coronavirus. This is an SBA 7(a) loan with the following terms, as amended by the Paycheck Protection Program Flexibility Act on June 5, 2020:

  • Loans can be for up to two and a half times your average monthly payroll costs from the last year. The amount is subject to a $10 million cap. If you are a seasonal or new business, you will use different applicable time periods for your calculation. Payroll costs will be capped at $100,000 annualized for each employee.
  • There is a 1% fixed rate.
  • There are no loan fees.
  • Payments will be deferred, but your deferment period depends on when you apply for loan forgiveness. Please see “When will I have to begin paying principal and interest on my PPP loan?” below for additional details.
  • The remaining balance after qualifying loan forgiveness will be paid on a five-year term for all loans made on or after June 5, 2020. Loans made prior to June 5, have a maturity of two-years; however, this may be modified to five years upon mutual agreement between the borrower and Simmons Bank. There are no prepayment penalties or fees.
  • Up to 100% of the principal amount is eligible for potential loan forgiveness.
  • No collateral or personal guarantees are required.

Am I eligible for the loan?

All businesses – including nonprofits, veterans’ organizations, tribal business concerns, sole proprietorships, self-employed individuals and independent contractors – with 500 or fewer employees can apply for a PPP loan. Businesses in certain industries can have more than 500 employees if they meet applicable SBA employee-based size standards for those industries.

What are the approved ways I can spend the money?

Approved uses of proceeds include:

  • Employee salaries, wages, commissions or tips (capped at $100,000 on an annualized basis for each employee).
  • Employee benefits, including costs for vacation, parental, family, medical or sick leave, allowance for separation or dismissal, payments required for the provisions of group health care benefits (including insurance premiums) and payment of any retirement benefit.
  • State or local tax assessed on compensation.
  • For a sole proprietor or independent contractor: wages, commissions, income or net earnings from self-employment, capped at $100,000 on an annualized basis for each employee.
  • Rent and utilities (lease agreements and utilities services must have been in place before Feb. 15, 2020).
  • Interest payments on mortgages incurred before Feb. 15, 2020, not principal payments.

Can I apply for both an economic injury disaster loan (EIDL) and PPP?

Yes. For an EIDL, you must apply directly through the SBA.

What parts of the loan are eligible for forgiveness?

The loan amounts could be forgiven, provided that two conditions are met:

  • The funds are used to cover payroll costs, mortgage interest, rent and utility costs over the 24-week period after the loan is made.
  • Employees and their compensation levels are maintained.

How many loans can I take out under this program?

Only one.

How much of my loan will be forgiven?

You will owe money when your loan is due if you use the loan amount for anything other than payroll costs, mortgage interest, rent and utilities payments during the 24 weeks after receiving the loan. No more than 40% of the forgiven amount may be used for non-payroll costs. You will also owe money if you do not maintain your staff and payroll. Keep in mind the following:

  • Your loan forgiveness will be reduced if you decrease your full-time employee headcount.
  • Your loan forgiveness will also be reduced if you decrease salaries and wages by more than 25% for any employee that made less than $100,000 annualized in 2019.
  • You have until June 30, 2020 to restore your full-time employment and salary levels for any changes made between Feb. 15, 2020 and April 26, 2020.

Can my loan be forgiven if my employees are unable to return to work?

A safe harbor in the PPP Flexibility Act provides that if you are unable to rehire previously employed individuals or similarly qualified employees, your loan forgiveness amount will not be reduced based on the reduction in full-time equivalent employees.

How can I request loan forgiveness?

Your Simmons banker will work with you to submit a loan forgiveness request. Please see our PPP Loan Forgiveness FAQ page for further details.

When will I have to begin paying principal and interest on my PPP loan?

If you submit a loan forgiveness application within 10 months after the end of your loan forgiveness covered period, you will not have to make any payments of principal or interest on your loan before the date on which SBA remits the loan forgiveness amount on your loan to Simmons Bank (or notifies the bank that no loan forgiveness is allowed). If you do not submit a loan forgiveness application within 10 months after the end of your loan forgiveness covered period, you must begin paying principal and interest after that period. For example, if a borrower’s PPP loan is disbursed on June 25, 2020, the 24-week period ends on December 10, 2020. If the borrower does not submit a loan forgiveness application to its lender by October 10, 2021, the borrower must begin making payments on or after October 10, 2021.

What is my “covered period”?

Your “loan forgiveness covered period” is the 24-week period beginning on the date your PPP loan is disbursed; however, if your PPP loan was made before June 5, 2020, you may elect to have your loan forgiveness covered period be the eight-week period beginning on the date your PPP loan was disbursed.

What certifications do I need to make?

As part of your application, you need to certify in good faith that:

  • Current economic uncertainty makes the loan necessary to support your ongoing operations.
  • The funds will be used to retain workers and maintain payroll or to make mortgage, lease and utility payments.
  • You have not and will not receive another loan under PPP.
  • Documentation that verifies the number of full-time equivalent employees on payroll and the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments and covered utilities for the loan forgiveness period.
    • Loan forgiveness will be provided for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments and covered utilities. Not more than 40% of the forgiven amount may be used for nonpayroll costs.
  • All the information you provided in your application and in all supporting documents and forms is true and accurate. Knowingly making a false statement to get a loan under this program is punishable by law.
  • You acknowledge that you are responsible for the calculation of the eligible loan amount and Simmons Bank will review the calculation using the documents you submitted. You affirm that the tax documents are identical to those you submitted to the IRS. You also understand, acknowledge and agree that Simmons Bank can share the tax information with the SBA’s authorized representatives, including authorized representatives of the SBA Office of Inspector General, for the purpose of compliance with SBA Loan Program Requirements and all SBA reviews.

Where can I find additional information?

For additional information, please visit U.S. Department of the Treasury or the SBA websites.