Evansville-based sporting goods manufacturer Escalade Inc., which was among the nation’s largest loan recipients under the Paycheck Protection Program, said late Tuesday afternoon that it has returned its $5.6 million loan.
The federal Paycheck Protection Program offers forgivable loans and was designed to keep small businesses afloat during the economic disruption of the COVID-19 pandemic.
The Small Business Administration, which is overseeing the program, defines a small business as one with 500 or fewer employees. But some larger PPP recipients were criticized for participating in the program, which ran out of its initial funding in 13 days. The SBA has put pressure on those companies to return the loans.
Escalade is a publicly traded company that makes sporting and recreational equipment. As of the end of last year, the company had 468 employees. The firm is relatively small compared to many public companies. It reported $180.5 million in revenue last year and $7.3 million in profit.
In a public filing, Tuesday afternoon, Escalade said it had repaid its PPP loan in full.
“We applied for a PPP loan at a time of great uncertainty for our business—and, at the time, our application fulfilled all the requirements of the program,” Escalade President and CEO Scott Sincerbeaux said in the filing. “Although COVID-19 continues to create substantial uncertainty and hardship throughout the world, we repaid our loan as a result of new guidelines from the Small Business Administration.”
Other large PPP recipients in Indiana included Indianapolis-based media company Emmis Communications Corp., which received $4.8 million; and Terre Haute-based coal-mining company Hallador Energy, which received $10 million.
Emmis, which has 449 employees, told IBJ Friday that it planned to keep its loan. That same day, the company announced it planned to delist its stock from the Nasdaq Stock market and go private.
Hallador has not responded to multiple requests for comment.
The loan program began accepting applications April 3 with an initial funding pool of $349 billion. Of the 1.7 million loans made during that first round, 74% percent of them were in amounts of $150,000 or less. Those smallest loans accounted for $58.3 million of the overall total.
On the other end of the spectrum, 4,412 of the loans were in amounts of more than $5 million, and those loans represented a combined $30.9 billion of the overall total.
After congress agreed to fund the program with an additional $310 billion, the PPP began accepting a second wave of applications Monday—but with a new requirement for borrowers.
According to SBA guidance issued Thursday, borrowers must certify their need for the PPP loan and their inability to tap other liquidity sources.
“It is unlikely that a public company with substantial market value and access to capital markets will be able to make the required certification in good faith, and such a company should be prepared to demonstrate to SBA, upon request, the basis for its certification,” the guidance says.
Borrowers that applied for a PPP loan before this guidance was issued will be considered to have made the certification in good faith if they repay the loan in full by May 7, the guidance says.