The House and Senate approved changes to the Paycheck Protection Program that is now headed to the President for signature.  The changes are more favorable for PPP Borrowers. 

It is important to note, once the President signs the new legislation, the final rules still need to be written by the Small Business Administration.  This means that complete clarity on the forgiveness process may not be known for several days.  Once those rules are written and a new Forgiveness Application is published the SBA, Platinum Bank will communicate with all PPP Borrowers to ensure a smooth forgiveness process.

Full details may be found here: https://www.congress.gov/bill/116th-congress/house-bill/7010?overview=closed.

Following are a few highlights:

  • The “covered period” is extended from 8 weeks to 24 weeks.  This allows business more time to spend the loan proceeds for eligible costs.
  • Increases cap on non-payroll expenses to 40%, which lowers the payroll expense requirement to 60%.
  • Extends the period to when a business can apply for forgiveness to 16 months, which is 10 months after the covered period ends.  There will be no payment of principal or interest due during this period.

Your Relationship Managers and the entire Platinum Team are here to assist you as needed.

Dear Platinum Bank Family,

We are entering the fourth month of the COVID-19 pandemic, which has had profound effects on our businesses, our employees, and our families. At Platinum, we have worked hard over the last few months to help our clients submit PPP applications and plan for a future that none of us could have anticipated.

If the pandemic has taught us one thing, it is that proactively working together is the way through our current collective challenge. Sticking our heads in the sand won’t address the obstacles the pandemic has placed before us. At Platinum Bank, it has always been our mission to be a strategic business partner for our clients, helping them plan for the future and find solutions to their business challenges. These last few months have undeniably given us the opportunity to refine this part of our mission.

No one planned to be closed or operate at a reduced capacity this year. If your current plan does not account for this new reality, it is time to create a new plan. There are seven months left in 2020… what is your plan to maximize them?

The good news is you do not have to formulate a plan on your own. Your Platinum advisors are ready to help you devise a plan that is tailored to your unique business. Whether you need to strategize how to keep your business alive through the next year, secure working capital, or grow your business through acquisition, our bankers are prepared to help you. And, if you need expertise outside of commercial banking, we can recommend professionals to add to your trusted advisor team.

Now more than ever, it is important to have a strong relationship with your banker.  If your current bank or banker is not a partner and an advisor for you and your business, please reach out to us.  We would love to start a conversation with you and to learn how we can be of service to you and your business.   

Be Well and Stay Safe,

Pete Odell

Senior Vice President, Commercial Relationship Manager

Many business owners who applied directly with the SBA for an Economic Injury Disaster Loan Emergency Advance are now receiving notification that they have been approved for an Economic Injury Disaster Loan. Before accepting the Loan, Borrowers should carefully read and understand the restrictions and requirements within the Loan Documents. Not adhering to the provisions as written means the Loan would be in default, granting rights by the SBA to “…declare all or any part of the indebtedness immediately due and payable.” 

We have reviewed the Loan Documents for the Economic Injury Advance Loan and want to highlight specific requirements of which Borrowers should be aware. It is the Borrower’s sole responsibility to review and understand all the requirements of the borrowing arrangement. We encourage Borrowers to seek legal representation to assist in this process. 

Loan Authorization and Agreement (Form 1391) 

➢ The Loan is priced at 3.75% fixed for 30 years. No payments of interest or principal are due for 12 months, with the balance amortized over 30 years from the date of the Promissory Note. 

➢ Loan amounts over $25,000 are secured by all business assets of the company through a UCC filing. ➢ Under the heading: REQUIREMENTS RELATIVE TO COLLATERAL, Borrowers are agreeing to the following statement: “Borrower will neither seek nor accept future advances under any superior liens on the collateral securing this loan without the prior written consent of the SBA.

o This statement appears to restrict a Borrower’s ability to utilize an existing Bank line of credit if the line of credit is secured by the same collateral. 

➢ The use of Loan proceeds is restricted to working capital, and the Borrower must maintain itemized receipts for three years. 

➢ Borrower is required to submit proof of active hazard insurance to the address listed within 12 months. 

➢ Borrower is required to provide fiscal year-end statements to the SBA within three months after the close of their fiscal year end. 

➢ Upon written request of the SBA, Borrower will accompany such statements with an “Accountant Review Report” prepared by an independent public accountant at the Borrower’s expense. 

➢ Under the heading: LIMITS ON DISTRIBUTION OF ASSETS, Borrower is agreeing to the following statement: “Borrower will not, without the prior written consent of SBA, make any distribution of Borrower’s assets…”

o This statement appears to disallow any Borrowers from making cash distributions for any reason, such as for taxes (unless approved by the SBA). 

➢ Borrower must send within 180 days a Resolution from the Board of Directors authorizing the funds. 

Security Agreement (Form 1059) 

➢ Borrower certifies “Collateral is free of all adverse claims, liens, or security interests (unless expressly permitted by Secured Party).”

o Borrowers are required to obtain Bank approval for the SBA lien if the Bank holds a collateral interest in the company. 

For more information on this and additional SBA updates, please refer to our Platinum Bank website 

or contact one of our business bankers at 651.332.5200

View the online presentation of Gears & Gadgets “Fearless Crisis Leadership in Manufacturing” virtual panel discussion.Gears and Gadgets, presented by Minnesota Manufacturing Executives (MME), is made possible by a dedicated Sponsor Team of which Platinum Bank is a member. Platinum Bank extends a note of appreciation to Peter Odell, Senior Vice President, Commercial Relationship Manager, for his commitment to serving the manufacturing community through this organization.

On Wednesday evening, the $349 billion Paycheck Protection Program (“PPP”) fund was exhausted. Washington is considering additional funding but until that occurs, banks cannot secure authorization for any new PPP loan requests. If you received notice that your loan was authorized, your funding is secured. If new funds are allocated, Platinum Bank will process the PPP applications for the few existing clients who were not able to secure funding before the pool ran dry. Currently, we are not accepting any additional applications.

As of today, we still do not have the final Small Business Administration rules on how the forgiveness process for PPP loans will work. Many of you have asked for this guidance and we understand the lack of clarity is frustrating. There have been indications the SBA is planning to create a spreadsheet to assist PPP borrowers with calculating the forgiveness amount. There are many examples of these on-line. To avoid creating further confusion, Platinum has elected to not create a forgiveness spreadsheet until additional clarification is received from the SBA. Once Platinum Bank receives the details about the forgiveness portion of the PPP program, we will immediately provide that information as well as direction on the submission process for your PPP loan forgiveness to Platinum Bank.

Following are specific actions you can take now that will allow you to streamline your PPP loan forgiveness process.

  1. Once the PPP funds are disbursed, the eight-week measurement period commences in which you are required to spend 75% of the funds on covered payroll cost and 25% on covered rent, utilities, and mortgage interest costs. Platinum Bank recommends all recipients of the PPP funds review the FAQ’s published by the SBA and Department of Treasury to assure your compliance and calculation of funds. If you have specific questions about calculations, we strongly recommend you reach out to your accountant.
  2. Maintain meticulous records of how the PPP funds are being used. As we do not know what detailed records will be required by the SBA, we suggest keeping thorough back-up records for how your PPP funds are being spent.

Your Relationship Managers and the entire Platinum Team are here to assist you as needed.

The federal Paycheck Protection Program (PPP) is providing a $349 billion lifeline to small businesses across the United States. The PPP offers small businesses forgivable loans to cover the cost of paying their employees during the COVID-19 pandemic. For many companies, PPP loans have made the difference between laying employees off and keeping everyone on the payroll.

Due to its popularity, however, many small business owners have found it difficult to secure the much-needed funding. Banks are struggling to keep up with demand. That’s why Platinum Bank was honored to be featured by one of our customers in a recent St. Paul Business Journal interview with journalist Patrick Rehkamp.

Our bankers were able to help Oak Marsh Golf Course owner Steve Whillock apply for and secure his PPP funding earlier this month. In the interview, Steve explained how the Platinum Bank team helped guide him through the application process, including answering any questions he had about the new program and how he could use the funding.

While Steve’s losing golf-related revenue due to the statewide Stay at Home order, he says the PPP loan will help him and his team weather the pandemic.

We were honored to be able to help Steve and other small business owners like him with their PPP and other loans during this difficult time. We have been able to help 250 business owners receive approximately $100 million in PPP loan relief. Today, the federal government is working on a solution to allow us to continue to serve even more business owners.

If you have questions about the financial health of your small business or just need to talk to a banker, the Platinum Bank team is here to help. Contact us today to get the conversation started.

The federal Paycheck Protection Program (PPP) is providing a $349 billion lifeline to small businesses across the United States. The PPP offers small businesses forgivable loans to cover the cost of paying their employees during the COVID-19 pandemic. For many companies, PPP loans have made the difference between laying employees off and keeping everyone on the payroll.

Due to its popularity, however, many small business owners have found it difficult to secure the much-needed funding. Banks are struggling to keep up with demand. That’s why Platinum Bank was honored to be featured by one of our customers in a recent St. Paul Business Journal interview with journalist Patrick Rehkamp.

Our bankers were able to help Oak Marsh Golf Course owner Steve Whillock apply for and secure his PPP funding earlier this month. In the interview, Steve explained how the Platinum Bank team helped guide him through the application process, including answering any questions he had about the new program and how he could use the funding.

While Steve’s losing golf-related revenue due to the statewide Stay at Home order, he says the PPP loan will help him and his team weather the pandemic.

We were honored to be able to help Steve and other small business owners like him with their PPP and other loans during this difficult time. We have been able to help 250 business owners receive approximately $100 million in PPP loan relief. Today, the federal government is working on a solution to allow us to continue to serve even more business owners.

If you have questions about the financial health of your small business or just need to talk to a banker, the Platinum Bank team is here to help. Contact us today to get the conversation started.

Beginning Friday, April 3, 2020, the SBA will begin accepting applications for Paycheck Protection Program (PPP) loans.

Funds in this program are expected to run out quickly. There are specific calls to action you must do for potential entry into the program. Once applications are approved and accepted, Platinum Bank will work with you and your company to finish the details per program requirements.

Following is information on the Paycheck Protection Program (PPP):

The necessary documents you must supply to Platinum Bank for potential entry into the PPP are:

  1. Paycheck Protection Program Application Form
  2. Detailed payroll reports for the past 12 months
  3. Most recent interim statement

PLEASE NOTE

  • Platinum Bank cannot guarantee that funds for all borrowers will be available.
  • Not all borrowers will qualify for funds.
  • Platinum Bank will work its best to get all qualified applications filed with the SBA but has no ultimate control of when that system runs out of authority and funding commitments.

Platinum Bank will continue to provide SBA updates as they become available. Please pass this information to your colleagues. They may also request to have these communications sent directly to them.

Contact us with questions: (651) 332-5200; www.platinumbankmn.com

Platinum Bank is Standing Ready to Support Our Clients and Business Communities

On Friday, March 27, 2020, legislation was passed and signed into law that will undoubtedly provide much needed support and relief for small business. The CARES (Coronavirus Aid, Relief, and Economic Security) Act is set to provide $2.0 Trillion in new spending to assist business and people as we battle through Covid19.

The Risk Management Association (RMA) has created a comprehensive CARES Act summary that can be found here.

What’s next?  Those new laws head to the agencies set to oversee them and committees whose job is to interpret them. Once authorized, the rules and guidance will be written and communicated to the Banks authorized to administer the program. Given the urgency to get dollars into small businesses hands, we expect those rules to be written very quickly.

How can your business be ready to go?  Make sure your financial records are up to date. This should include a detailed 12-month breakdown of your payroll records, as we believe this information to be the primary driver in determining the amount of eligible loan funds and amounts potentially forgiven under the CARES Act.

In the coming days, once these programs are ready, we will publish a checklist that will include all items necessary to move forward with application and funding under the CARES Act.

As a seasoned and preferred SBA lender – Platinum Bank will be ready when the programs are.

For more information, or to be added to these communications, contact one of our business bankers today at 651.332.5200.

Dear Friends and Clients,

To keep you apprised of the updates to the SBA Economic Impact Disaster Loans (EIDL) process that we shared with you earlier this week, the following supplemental information may help you to expedite the application process. Contact Platinum Bank to assist you along the way.

  • The SBA acknowledged that there are connectivity issues during the application process.  This is due to the heavy traffic currently going through those servers.  They stated that they are working to add more capacity to help with these issues.  In the meantime, they recommended:
    • Complete the PDF versions of the forms before beginning the electronic application.  This way you have all of information available and questions answered already, and can simply pull from the completed form.  This will reduce the amount of time you are in the electronic application and reduce the chances of losing connection mid-way through.  Access forms here:  https://disasterloan.sba.gov/ela/Information/PaperForms.
    • Save the application often during the process so if you do get kicked out, you can jump back in where you left off.
    • If possible, access the application during “off” hours, primarily evenings/nights.
    • Use Microsoft Edge, if available, as that is the preferred internet browser (yes, it makes a difference!).
  • There is no place on the application form for the applicant to request a dollar amount.  This is determined during the underwriting/approval process.
  • The Borrower’s name on the application must read exactly how it reads on the Corporate documents.  Individuals names must also be exactly correct on the application (William vs. Bill).
  • SBA will determine the loan amount based on the applicant’s monthly business expenses, a review of the applicant’s balance sheet and liquidity position, and the guarantor’s personal credit history.
    • This amount can be modified after approval if it is determined that the applicant business requires additional funds.
  • After approval, the first $25,000 disbursement will be made available right away.  Any additional funds would only become available once all required collateral has been pledged.
  • Loans will be for a term of either 15 years or 30 years, to be determined by the SBA based on repayment ability.  There is no pre-payment penalty.
  • A business owner can use proceeds of the disaster loan to pay payroll to all employees, including themselves.  Owner salary should be included in their list of expenses, and SBA will allow owner salary to continue at a level consistent with what they had been paying prior to the disaster, as long as it is not deemed to be “excessive”.
  • The SBA Disaster Loan center can be reached at:  disastercustomerservice@sba.gov (all one word) and the contact number is 1-800-659-2955.

As always, Platinum Bank is a resource for you and can assist you with questions and guidance during the application process. Contact us at 651.332.5200 or clientsupport@platinumbankmn.com.

 

Below is a link to the forms referenced above:

https://disasterloan.sba.gov/ela/Information/PaperForms

Additional questions can be directed to the SBA Disaster Assistance team at 800-659-2955 or disastercustomerservice@sba.gov

View this video for assistance in filling out the SBA form.

 

 

 

 

SUPPORTING AND MAINTAINING SEAMLESS BUSINESS OPERATIONS

As businesses continue to navigate through the effects of COVID-19, it is important to know that there are valuable tools available to decrease the level of adverse impact to your company. This is a time of flux. Making sound decisions today will keep your business thriving and, as needed, create seamless transitions in the day-to-day operations of your organization.

While many service organizations are wavering in this pandemic, Platinum Bank’s strength and commitment to your business go uncompromised. We continue to offer a full suite of remote cash management tools and services for your business’s continued productivity and security. As many of you will be working from home, our 24/7 online services are available when and where you need them. And, we will continue to provide secure options and advice to you over the phone during our normal business hours, Monday – Friday, 7:30 AM – 5:00 PM.

Platinum’s full line of cash management products and services include:

  • Online Banking
  • Remote Deposit
  • Mobile Banking
  • Mobile Remote Deposit
    • ACH origination
    • Positive Pay
    • Merchant Services

    To connect with the department for your specific needs, contact:

    • Cash Management Services: 332.5215; cashmanagement@platinumbankmn.com
    • eServices: 332.5275; eservices@platinumbankmn.com
    • Client Services: 332.5216; clientsupport@platinumbankmn.com

    Platinum Bank is here for you. Contact me directly if you have any questions or concerns regarding your specific cash management needs. Thank you.

    Zach Busch
    Vice President – Cash Management
    651.332.5215 (direct)
    651.231.9619 (cell)
    zbusch@platinumbankmn.com