Insights

PPP Guidance, SBA Updates & Some Humor

April 01, 2020

Given its April Fool’s Day, I was going to have the following headline:  “Coronavirus defeated, all social distancing rules lifted.”  However, in the current environment, I will reserve my humor for other topics (see the end of the email).

It is definitely a weird time.  I was chatting with a friend/business coach/Vistage Chair (Chad Harvey; www.chadharvey.com) yesterday.  He said it best:  “Every day, I feel like I have worked harder than I have before only to complete at best half of what I planned to do”……Wise words that sum up my daily work routine as well.

Here are the things that I think are important and you may want to review:

  1. PPP guidance provided, sample application linked here.  The much-anticipated guidance on PPP was released by the SBA and the Department of Treasury.  Loans can start to be processed in April.  As a reminder, this guidance and the program are being updated almost daily.  Please make sure you review your options with your Bank.   The King of Prussia SBA Office provided the following guidance last night:

“SBA will be providing more guidance to lenders shortly which will be provided through their respective banking and trade associations. This will happen in the next 24 hours. So what can you do? 

  1. Familiarize yourself with the (current version) of the PPP application – linked above
  2. Start to gather any information you have which may justify their payroll/loan amount calculation (official guidance is forthcoming).
  3. Once we receive word from the SBA on any other required documentation, we will let you know.”
  4. Linked is a list of SBA lenders and consultants (not exhaustive, but a good start….if you are not on the list, please send me your details)
  5. SBA and other COVID-19 Disaster Loans; Things You Should Consider If You Have Preexisting Loans:  As you are applying for the various programs, please make sure you are reviewing any of your preexisting loan documents and talking with your legal counsel, accountant, banker or other professional service provider.  Also, the linked document provides a good comparison of PPP and EIDL.  Below are some questions to consider:
    1. What are the recourse provisions (e.g., personal guarantees)?
    2. What impact will the new SBA loan have on existing collateral?
    3. Are there any cross default issues?
    4. Are there any non-monetary default provisions?
    5. What happens if you file for bankruptcy or close the business?
    6. Will the bank take a second position to the new SBA loan?

PLEASE LET US KNOW IF YOU WOULD LIKE TO DISCUSS ANY OF THE TOPICS ABOVE

  1. PA Working Capital Assistance Program has been exhausted; Nothing definitive as a follow on, but more could be proposed. 
  2. Upcoming Webinars
    1. RKL Webinar 4/3/2020 @ 11am:  Scott Myers mentioned that their capacity at the last webinar nearly reached capacity.  He recommends signing ASAP.  https://zoom.us/webinar/register/WN_oHY8hpMvQqaY-2thMmpbvg
    2. EisnerAmper 4/2/2020 1:30pm-3pm:  Carey Gertler sent this registration link.

And last but not least, we did an informal survey of ZOOM users and their meeting usage time.  Below are the results of the survey:

Zoom Meeting Attention Span Diagram

Please see all of our updates at the following link:  https://mpl-law.com/resource-center/

 As always, please don’t hesitate to email myself, Andy Miller (amiller@mpl-law.com) or Christian Miller (cmiller@mpl-law.com) or anyone in our office with any questions or comments. 

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