Ruth’s Hospitality Group, which owns the restaurant chain Ruth’s Chris Steak House, will return the $20 million of small business loan it received from the Federal Government’s Paycheck Protection Program or PPP, reports said.
The decision follows the government’s new guidance for the program as well as public outrage after the multimillion-dollar company secured the loan, which was intended for small businesses struggling during the coronavirus or COVID-19 pandemic.
Ruth’s Hospitality Group CEO Cheryl Henry said, “We intended to repay this loan in adherence with government guidelines, but as we learned more about the funding limitations of the program and the unintended impact, we have decided to accelerate that repayment.”
According to an SEC filing, Ruth’s Chris Steak House was granted a total of $20 million in loans in early April through two subsidiaries to help maintain payroll through the coronavirus crisis.
The government’s $350 billion emergency program is part of the $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act, aiming to help small businesses, including restaurants, with fewer than 500 employees.
Even though larger companies are qualified for the program through a loophole in the bill, the PPP ran out of money before reaching many struggling small businesses.
Ruth’s Hospitality operates more than 100 steakhouses across the U.S., Canada, and Mexico, with more than 5,000 employees.
The company reportedly said its goal was to utilize funds to keep as many team members working for as long as possible and to cover 100% of healthcare benefits.
Meanwhile, more than 260,000 people signed a Change.org petition demanding Ruth’s Chris Steak House to return the loans.
Earlier this week, Burger chain Shake Shack Inc. said it will return a $10 million small business loan that it received from the PPP, as it was able to raise additional capital from the public markets.
Source: Read Full Article