June 19, 2020
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Taylor Porter Managing Partner Bob Barton and Taylor Porter Partner and Executive Committee Member Brett Furr joined IberiaBank Executive Vice President and Baton Rouge Market President John Everett to present a BRAC Business Webinar, “Last Call for the Paycheck Protection Program.” The webinar, sponsored by Horizon Financial Group, was held Thursday, June 18.
Applications for the federal Paycheck Protection Program must be made by June 30. The Program has been a lifeline to many businesses coping with lost revenue due to COVID-19 and its associated Stay at Home orders. Congress passed additional legislation about the Program in the first week of June, and the Small Business Administration seems to release new guidance every week.
Barton, Furr, and Everett discussed the PPP, its recent changes, guidance on the loan forgiveness rules, and the most recent Paycheck Protection Program Flexibility Act of 2020, signed into law by President Trump on June 5. The Act modified provisions related to the forgiveness of loans made to small businesses, including extending the covered period during which borrowers may use loan proceeds for eligible expenses from 8 weeks to 24 weeks or until the end of the year, whichever comes first, and borrowers have until December 31, 2020, to restore reductions in employee headcount and wages. Borrowers that received their PPP loans prior to the enactment of the Act, however, may choose to opt out of the extension and continue using the original 8-week covered period if the shorter covered period produces a more favorable result for the borrower.
For more information on the PPP Flexibility Act, read Taylor Porter’s latest blog article at: http://www.taylorporter.com/blog/post/ppp-flexibility-act-2020-signed-into-law
On June 17, the SBA, in consultation with the Department of the Treasury, posted a revised, borrower-friendly PPP loan forgiveness application implementing the PPP Flexibility Act of 2020. In addition to revising the full forgiveness application, SBA also published a new EZ version of the forgiveness application that applies to borrowers that are self-employed and have no employees; or did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; or experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%.
The EZ application requires fewer calculations and less documentation for eligible borrowers. Both applications give borrowers the option of using the original 8-week covered period (if their loan was made before June 5, 2020) or an extended 24-week covered period.
For all PPP tools, visit https://home.treasury.gov/policy-issues/cares/assistance-for-small-businesses.
Taylor Porter attorneys continue to closely monitor the developments of the SBA loan programs and the CARES Act. Visit the Taylor Porter Coronavirus - Legal News and Business Resources website for updated legislation, news, and legal developments pertaining to COVID-19.
BRAC, a regional economic development organization that includes more than 1,500 investor members, has produced several webinars since COVID-19, and has relevant resources and information for businesses at: https://brac.org/recovery/
About Bob Barton: Taylor Porter Managing Partner Bob Barton, practicing law since 1994, represents local and national businesses in matters involving commercial litigation and transactions, regulatory and compliance matters, and general litigation. He is the co-chair of the firm's Business and Commercial Litigation practice. Bob has been selected for inclusion in both Louisiana Super Lawyers and Best Lawyers in Business Litigation.
About Brett Furr: Taylor Porter Partner and Executive Committee Member Brett Furr practices in banking, commercial litigation, and real estate. Brett is the former chairman of the Banking Law Section of the National Lawyers Association. Brett has been selected by clients and peers for inclusion in Chambers USA (Bankruptcy/Restructuring), Louisiana Super Lawyers (Banking) and Best Lawyers (Real Estate).
About John Everett: John Everett serves as executive vice president and president of the Baton Rouge Market for IberiaBank. John was previously senior vice president and commercial group manager in Baton Rouge. The Baton Rouge native joined IberiaBank in 2008 and has more than 20 years of commercial banking experience. He began his banking career with First Commerce Corp. in New Orleans, then served as vice president in commercial banking with Whitney National Bank in Baton Rouge.