Cash Flow Help, PPP Loan Webinar, SBA Update

Originally Published : April 9, 2020


Dear HL Clients:

I have spoken to many of you over the past few weeks about your concerns and fears and would sum up the common theme with just one exclamatory word.  How?!  How am I going to make it to reopening?  How am I going to have enough cash to get there? How do I plan for it?  How do I turn back time and do anything other than own a restaurant.  You get the idea.

Well, in our attempt to get you practical, real-world solutions that go beyond our role as attorneys, advisors  advocates and ranters and ravers, we completed a partnership with a long-term client and colleague to launch a new consulting practice.  

Jared Lewis is the Managing Partner of our consulting company and he’s a long time restaurant and bar owner (Building on Bond and others) who also has a Masters in Hospitality Finance from NYU so we have harnessed his financial prowess to focus on how we can help owners manage their cash in weirdo world.  Here is his new column (I named it so don’t blame him):

 WE WENT TO JARED  by Jared Lewis 

Everybody is rightly concerned about how to make your money last and how you will stay afloat until you reopen.  Well, you need a real plan.  It helps alleviate the angst.  Here is what you should be asking yourself now before things get totally nuts:
How much money will I have in 1,3,6 months?
How can I make what I’ve got last longer?
When will I run out of cash and what will happen then?

Here is how you get to the answers: 
Step 1: Clean up Your Books

There’s a good chance you’ve had to lay off your bookkeeper.  If you can afford a few hours of their time each week, do it.  In any case, do this:  Reconcile bank and credit card accounts against your most recent statements.Update accounts payable to reflect recent charges, payments and credits.Confirm across the board that your reporting accurately reflects your current financial position.

Step 2: Gather Information
Bear down and get this financial stuff together:2019 Profit and Loss Statement w/ Monthly Detail
Last complete month P&L (Jan/Feb 2020)Current Balance Sheet
Accounts Payable Aging Schedule
Detail of outstanding salaries, wages and/or gratuities payable
Sales tax payable details (past due, not yet due amounts etc.)Details of short and long term liabilities reflected in balance sheet
Most recent bank statement and current balance
List of existing lines of credit (including status, balance and available credit)List of any uncleared checks
List of pending and/or future electronic payments (particularly those set to auto-pay)
List of loans/grants applied for (amounts, disbursement dates, interest rates and terms)
List of unrecorded or not yet received bills anticipated in next three months (eg. Annual license/permit renewals, insurance policy audits etc.) 

Step 3: Develop a 13-Week Cash Flow Forecast
With the above information gathered, the most critical step is to build a 13-week rolling cash flow forecast.  We can help you with that.
Contact Us for a Complimentary Cash Flow Assessment

In your complimentary 45-minute call we will discuss the specifics of your situation and collaboratively decide on an action plan to address your financial situation and prepare for reopening.  We will answer questions you may have and share the insights and solutions we have seen work so far.  We will also layout the options and details should you wish to engage our help in a more meaningful way.

Contact me here:
Jared Lewis
P: 201 220 2668
E: [email protected]

And now a word from the trenches:

Joey Regs says:

PPP applications next steps.
It will be slightly different for everyone – varying from bank to bank and also varying based on the completeness of the paperwork provided upfront.  The next step, post-filing, will be that a loan officer from your bank may reach out to you to discuss the application.  They may ask for additional supporting documentation, or to have you (or us) explain some of the submissions made with the application filing.  Answering these queries and requests is crucial.  Accurate, complete answers and clean filings will result in a swift review process. 
Once you are approved for the loan and receive your money from the bank, you really have to pay attention.  You must have a clear understanding of the rules and guidelines of this particular loan – and if you’ve been paying attention, you’ll know that these rules and guidelines have been ever-changing over the last week. You must be clear on how you can use the money, what you spend it on, and you must make sure that your ratios are in order if you expect to have any part of this loan forgiven.  Make no mistake about it: if you misuse the funds, you could be in jeopardy of having NONE of the loan forgiven.
There is a “forgivable window.”  And that window is eight weeks from the day your loan gets funded.  If you do things correctly, all of your payroll expenses, rent and utilities for this period could get completely forgiven.  So, there’s great value in knowing the rules and the parameters of the game you’re playing here.
If you are interested in a deeper overview of the best practices with PPP loans, how to correctly spend the money, and what the most up-to-date rules and guidelines of this program are, please tune in to our webinar on this topic on Friday, April 10th at 2:00 PM. More info below.
The NYC $75k interest free loan is closed.  They’re oversubscribed, is what we’re hearing, so even if the application got in under the gun, they still may kick back the application due to extraordinarily high application volumes.  Anyone who submitted their own application, please keep this in mind.  Anyone who has engaged us to do the same, stay tuned.  We’re following up aggressively with the City and are in the process of double-confirming everything, for each of you, in light of this news. 
EIDLs are still humming along.  More and more of these go in every single day.  Although we haven’t heard anything official, we would assume that this pot will dry up at some point.  So, we’re working as aggressively as possible to fire these in as soon as possible, so people don’t get stuck.

Rumor Mill:
We’re hearing rumors of new vehicles being prepped as we speak.  They won’t be as widely accessible as the PPP, in terms of eligibility, and there won’t be any forgiveness provision (like the PPP), but they could be useful.  We don’t want to publish any incorrect info, so we’re going to collect some more details before reporting about it.  But just know that a few of these are in the works, and we will be bringing you the details as soon as they’re available.
Joey Regs Out.

 WEBINAR ALERT: PPP’s and QQQ’s tomorrow, Friday, at 2:00 
Who Should Attend.Businesses determining whether the PPP is right for themBusinesses that have already applied and need to know what comes nextHospitality and retail businesses that employ a primarily hourly workforce What We’ll be Discussing.What hospitality/retail businesses are supposed to do with PPP money even though they cannot be operating right now.Helping you understand what it takes to qualify for FULL loan forgiveness – but also what to expect if you don’t qualify for full forgiveness and how “reductions” in forgiveness apply to youWalking you through the steps that need to be taken NOW to maximize loan forgivenessRegister Here:

You’re feedback is always welcome and many of you send me notes about the newsletters with ideas, questions, compliments and chastisements.  Please keep them coming as it’s almost always good to hear from you.

I bid you good night.