SBA Paycheck Protection Program First Draw

The Economic Aid Act reauthorizes lending under the PPP through March 31, 2021. To begin the First Draw loan process, please email our onboarding team at or contact your Business Banker or Treasury Banker directly. 

Have questions about a First Draw loan? For your convenience, we've listed some of the FAQs below. 
You are eligible for a PPP loan if you, together with any affiliates are:
  • a small business, in operation on February 15, 2020, and either had employees for whom you paid salaries or payroll taxes, and employ no more than 500 employees
  • an independent contractor, eligible self-employed individual, or sole proprietor and file a Form 1040, Schedule C
  • a tax-exempt nonprofit organization or otherwise eligible 501(c)(6) organization
  • veterans or tribal organization 
  • a housing cooperative
  • other specific criteria may apply
If you do not meet the above criteria and believe you may be eligible please email to speak with a member of our onboarding team. 
You are ineligible for a PPP loan if you are:
  • a business organization which was not in operation on February 15, 2020
  • a business that is permanently closed
  • a household employer (ex- employer of nannies or housekeepers)
  • a recipient of the Shuttered Venue Operator Grant program
  • an issuer of a national securities exchange, a hedge fund or private equity firm
  • the head of an Executive government department, Member of Congress, or the spouse of such a person as determined by applicable common law
  • a business that is currently delinquent or has defaulted on a direct or guaranteed loan from SBA or another Federal agency within the last seven years
  • a business in bankruptcy proceedings
  • engaged in any activity that is illegal, or an owner of 20 percent of more of the business equity is presently subject to criminal charges, an indictment, arraignment, is incarcerated, or convicted
In most cases a borrower will be considered together with its affiliates for purposes of determining eligibility. Affiliation is based on factors including but not limited to stock ownership, overlapping management, and identity of interest. Participation in an employee stock ownership plan (ESOP) is not considered an affiliation. 
Generally speaking, the maximum amount for a First Draw loan is:
  • equal to the lesser of 2.5 months of the borrower's average monthly payroll costs (2.5/12) or $10 million
  • having subtracted any compensation paid to an employee in excess of $100,000 annually, pro-rated for the time period when payments are paid or incurred
  • other exceptions can be provided by your Business Banker or Treasury Banker
The interest rate is 1%, calculated on a non-compounding, non-adjustable basis, with the maturity of five years. As long as a borrower submits its loan forgiveness application within 10 months of the completion of the Covered Period, the borrower is not required to make any payments of principal or interest until the forgiveness amount is remitted to the lender by SBA.

If the loan is fully forgiven, the borrower is not responsible for any payments. If a portion of the loan is forgiven, or if the forgiveness application is denied, any remaining balance due on the loan must be repaid by the borrower on or before the maturity date of the loan.

Interest accrues during the time between the disbursement of the loan and SBA remittance of the forgiveness amount. The borrower is responsible for paying the accrued interest on any amount of the loan that is not forgiven. 
Applicants must submit Paycheck Protection Program Borrower Application Form (SBA Form 2483), or lender's equivalent form, and payroll documentation. Please contact your Business Banker or Treasury Banker directly to begin the application process. If you are not presently a client of Blackhawk, please email our onboarding team at 
PPP loans may be used for:
  • at least 60% must be used for payroll costs (as defined in the CARES Act, Economic Aid Act, and the Interim Final Rule)
  • costs related to the continuation of group health care, life, disability, vision, or dental benefits 
  • mortgage interest payments (not pre-payments or principal payments)
  • rent and utility payments
  • interest payments on any other debt obligations that were incurred before February 15, 2020
  • certain property damage and covered supplier costs
  • other specific covered operating expenses
  • cannot be used for lobbying activities or expenditures related to elections or for purposes designed to influence legislation
  • use of unauthorized purposes will be subject to liability and fraud charges
Borrowers must certify in 'good faith' to the following:
  • the applicant was in operation on February 15, 2020 and has not permanently closed
  • current economic uncertainty makes this loan request necessary to support ongoing business operations/obligations
  • the funds will be used to retain staff, maintain payroll, and other covered expenditures
  • not more than 40% of loan proceeds will be used for nonpayroll costs
  • the applicant has not and will not receive another loan under the PPP (excluding Second Draw) or Shuttered Venue Operator Grant from the SBA
On May 13, 2020, the SBA & Department of Treasury issued guidance concerning review of the good faith certifications, including a safe harbor providing that any PPP borrower, together with its affiliates, that received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the loan request in good faith
No. Independent contractors have the ability to apply for a PPP loan on their own