15 U.S.C. § 9042: Emergency relief and taxpayer protections

Notwithstanding any other provision of law, to provide liquidity to eligible businesses, States, and municipalities related to losses incurred as a result of coronavirus, the Secretary is authorized to make loans, loan guarantees, and other investments in support of eligible businesses, States, and municipalities that do not, in the aggregate, exceed $0 and provide the subsidy amounts necessary for such loans, loan guarantees, and other investments in accordance with the provisions of the Federal Credit Reform Act of 1990 ( 2 U.S.C. 661 et seq.). Not more than $0 shall be available to make loans and loan guarantees for passenger air carriers, eligible businesses that are certified under part 145 of title 14, Code of Federal Regulations, and approved to perform inspection, repair, replace, or overhaul services, and ticket agents (as defined in section 40102 of title 49 ). Not more than 0 1 shall be available to make loans and loan guarantees for cargo air carriers. 1 So in original. Probably should be preceded by a dollar sign. Not more than 0 1 shall be available to make loans and loan guarantees for businesses critical to maintaining national security. purchasing obligations or other interests directly from issuers of such obligations or other interests; purchasing obligations or other interests in secondary markets or otherwise; or making loans, including loans or other advances secured by collateral. A loan, loan guarantee, or other investment by the Secretary shall be made under this section in such form and on such terms and conditions and contain such covenants, representations, warranties, and requirements (including requirements for audits) as the Secretary determines appropriate. Any loans made by the Secretary under this section shall be at a rate determined by the Secretary based on the risk and the current average yield on outstanding marketable obligations of the United States of comparable maturity. As soon as practicable, but in no case later than 10 days after March 27, 2020 , the Secretary shall publish procedures for application and minimum requirements, which may be supplemented by the Secretary in the Secretary’s discretion, for making loans, loan guarantees, or other investments under paragraphs (1), (2) and (3) of subsection (b) . the applicant is an eligible business for which credit is not reasonably available at the time of the transaction; the intended obligation by the applicant is prudently incurred; reflects the risk of the loan or loan guarantee; and is to the extent practicable, not less than an interest rate based on market conditions for comparable obligations prevalent prior to the outbreak of the coronavirus disease 2019 (COVID–19); the duration of the loan or loan guarantee is as short as practicable and in any case not longer than 5 years; the agreement provides that, until the date 12 months after the date the loan or loan guarantee is no longer outstanding, neither the eligible business nor any affiliate of the eligible business may purchase an equity security that is listed on a national securities exchange of the eligible business or any parent company of the eligible business, except to the extent required under a contractual obligation in effect as of March 27, 2020 ; the agreement provides that, until the date 12 months after the date the loan or loan guarantee is no longer outstanding, the eligible business shall not pay dividends or make other capital distributions with respect to the common stock of the eligible business; the agreement provides that, until September 30, 2020 , the eligible business shall maintain its employment levels as of March 24, 2020 , to the extent practicable, and in any case shall not reduce its employment levels by more than 10 percent from the levels on such date; the agreement includes a certification by the eligible business that it is created or organized in the United States or under the laws of the United States and has significant operations in and a majority of its employees based in the United States; and for purposes of a loan or loan guarantee under paragraphs (1), (2), and (3) of subsection (b), the eligible business must have incurred or is expected to incur covered losses such that the continued operations of the business are jeopardized, as determined by the Secretary. entered into directly with an eligible business as borrower; and not part of a syndicated loan, a loan originated by a financial institution in the ordinary course of business, or a securities or capital markets transaction. until the date 12 months after the date on which the direct loan is no longer outstanding, not to repurchase an equity security that is listed on a national securities exchange of the eligible business or any parent company of the eligible business while the direct loan is outstanding, except to the extent required under a contractual obligation that is in effect as of March 27, 2020 ; until the date 12 months after the date on which the direct loan is no longer outstanding, not to pay dividends or make other capital distributions with respect to the common stock of the eligible business; and to comply with the limitations on compensation set forth in section 9043 of this title . The Secretary may waive the requirement under clause (ii) with respect to any program or facility upon a determination that such waiver is necessary to protect the interests of the Federal Government. If the Secretary exercises a waiver under this clause, the Secretary shall make himself available to testify before the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives regarding the reasons for the waiver. For the avoidance of doubt, any applicable requirements under section 13(3) of the Federal Reserve Act ( 12 U.S.C. 343(3) ), including requirements relating to loan collateralization, taxpayer protection, and borrower solvency, shall apply with respect to any program or facility described in subsection (b)(4). A program or facility in which the Secretary makes a loan, loan guarantee, or other investment under subsection (b)(4) shall only purchase obligations or other interests (other than securities that are based on an index or that are based on a diversified pool of securities) from, or make loans or other advances to, businesses that are created or organized in the United States or under the laws of the United States and that have significant operations in and a majority of its employees based in the United States. the uncertainty of economic conditions as of the date of the application makes necessary the loan request to support the ongoing operations of the recipient; the funds it receives will be used to retain at least 90 percent of the recipient’s workforce, at full compensation and benefits, until September 30, 2020 ; the recipient intends to restore not less than 90 percent of the workforce of the recipient that existed as of February 1, 2020 , and to restore all compensation and benefits to the workers of the recipient no later than 4 months after the termination date of the public health emergency declared by the Secretary of Health and Human Services on January 31, 2020 , under section 247d of title 42 in response to COVID–19; the recipient is an entity or business that is domiciled in the United States with significant operations and employees located in the United States; the recipient is not a debtor in a bankruptcy proceeding; the recipient is created or organized in the United States or under the laws of the United States and has significant operations in and a majority of its employees based in the United States; the recipient will not pay dividends with respect to the common stock of the eligible business, or repurchase an equity security that is listed on a national securities exchange of the recipient or any parent company of the recipient while the direct loan is outstanding, except to the extent required under a contractual obligation that is in effect as of March 27, 2020 ; the recipient will not outsource or offshore jobs for the term of the loan and 2 years after completing repayment of the loan; the recipient will not abrogate existing collective bargaining agreements for the term of the loan and 2 years after completing repayment of the loan; and that the recipient will remain neutral in any union organizing effort for the term of the loan. Nothing in this subparagraph shall limit the discretion of the Board of Governors of the Federal Reserve System to establish a Main Street Lending Program or other similar program or facility that supports lending to small and mid-sized businesses on such terms and conditions as the Board may set consistent with section 13(3) of the Federal Reserve Act ( 12 U.S.C. 343(3) ), including any such program in which the Secretary makes a loan, loan guarantee, or other investment under subsection (b)(4). The Secretary shall endeavor to seek the implementation of a program or facility in accordance with subsection (b)(4) that provides liquidity to the financial system that supports lending to States and municipalities. the eligible business has issued securities that are traded on a national securities exchange; and the Secretary receives a warrant or equity interest in the eligible business; or a warrant or equity interest in the eligible business; or a senior debt instrument issued by the eligible business. Such terms and conditions shall be designed to provide for a reasonable participation by the Secretary, for the benefit of taxpayers, in equity appreciation in the case of a warrant or other equity interest, or a reasonable interest rate premium, in the case of a debt instrument. For the primary benefit of taxpayers, the Secretary may sell, exercise, or surrender a warrant or any senior debt instrument received under this subsection. The Secretary shall not exercise voting power with respect to any shares of common stock acquired under this section. If the Secretary determines that the eligible business cannot feasibly issue warrants or other equity interests as required by this subsection, the Secretary may accept a senior debt instrument in an amount and on such terms as the Secretary deems appropriate. The principal amount of any obligation issued by an eligible business, State, or municipality under a program described in subsection (b) shall not be reduced through loan forgiveness. the amount transferred from the appropriation made under section 9061 of this title to the financing accounts; and the amount necessary to repay any amount lent from the Treasury to such financing accounts. After the deposits specified in paragraph (1) of this subsection have been made, into the Federal Old-Age and Survivors Insurance Trust Fund established under section 401(a) of title 42 . using direct hiring authority to hire employees to administer this part; entering into contracts, including contracts for services authorized by this part; establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase, hold, and sell assets and issue obligations; and issuing such regulations and other guidance as may be necessary or appropriate to carry out the authorities or purposes of this part. perform all reasonable duties the Secretary determines necessary to respond to the coronavirus; and be paid for such duties using appropriations available to the Secretary to reimburse financial institutions in their capacity as financial agents of the United States. Any loan made by or guaranteed by the Department of the Treasury under this section shall be treated as indebtedness for purposes of the Internal Revenue Code of 1986, shall be treated as issued for its stated principal amount, and stated interest on such loans shall be treated as qualified stated interest. The Secretary of the Treasury (or the Secretary’s delegate) shall prescribe such regulations or guidance as may be necessary or appropriate to carry out the purposes of this section, including guidance providing that the acquisition of warrants, stock options, common or preferred stock or other equity under this section does not result in an ownership change for purposes of section 382 of the Internal Revenue Code of 1986 [ 26 U.S.C. 382 ].