On Friday, June 5, 2020, President Trump signed into law the “Paycheck Protection Program Flexibility Act of 2020” (the “Act”). The U.S. Senate passed the measure by “unanimous consent” on Wednesday, June 3, following its passage in the U.S. House of Representatives on Thursday, May 29 by a vote of 417 to 1. The Act modifies the Paycheck Protection Program (the “PPP”) established by the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). In particular, the Act (1) establishes a minimum maturity of five years for all loans made after the enactment of the Act and permits an extension of the maturity of existing loans to five years if the borrower and lender agree; (2) extends the “covered period” (as described below) in Section 1102 of the CARES Act from June 30, 2020, to Dec. 31, 2020; (3) extends the eight-week “covered period” for expenditures that qualify for forgiveness to the earlier of (i) 24 weeks following loan origination and (ii) December 31, 2020; (4) extends the deferral period for payment of principal, interest and fees to the date on which the forgiveness amount is remitted to the lender by the Small Business Administration; (5) requires the borrower to use at least 60% (down from 75%) of the proceeds of the loan for payroll costs, and up to 40% (up from 25%), for other permitted purposes, as a condition to obtaining forgiveness of the loan; (6) delays from June 30, 2020 to December 31, 2020 the date by which employees must be rehired to avoid a reduction in the amount of forgiveness of a loan, and creates a “rehiring safe harbor” that allows businesses to remain eligible for loan forgiveness if they (i) make a good-faith attempt to rehire employees or hire similarly qualified employees, but are unable to do so, or (ii) are able to document an inability to return to pre-COVID-19 levels of business activity due to compliance with social distancing measures; and (7) allows borrowers to receive both loan forgiveness under the PPP and the payroll tax deferral permitted under the CARES Act, rather than having to choose which of the two would be more advantageous.