Only 13 companies have said they will return coronavirus small business loans
A tiny fraction of the publicly traded companies that got coronavirus loans have pledged to give them back — despite urging from the feds and a public outcry, records show.
Just 13 public firms that received a combined $98.5 million through the federal Paycheck Protection Program — which was meant to help Main Street merchants keep workers employed — have said they would return the loans as of Monday morning, according to regulatory filings compiled by data-analysis firm FactSquared.
That suggests many of the 222 public companies that received so-called PPP loans will keep them — despite the Small Business Administration urging firms to repay them by May 7. Some companies may still be deciding whether to return their loans while others may have yet to publicly disclose their decision.
Companies returning funds include five big restaurant chains that qualified for the so-called PPP loans even though they each employ more than 1,000 people. The program allowed pandemic-battered restaurant companies to apply as long as they had no more than 500 employees at any one location.
Ruth’s Hospitality Group, the company behind Ruth’s Chris Steak House, has pledged to return two loans worth $20 million while sit-down chain J. Alexander’s will return $15.1 million, SEC filings show. Fast-casual chains Shake Shack and Potbelly Sandwich Shop are each giving back $10 million and California-based Kura Sushi is returning $5.9 million.
Some lesser-known health care and biotechnology companies are also returning their loans. Among them is Wave Life Sciences, which got $7.2 million weeks after disclosing hefty losses and telling investors it could be “many years” before it had any products ready to sell, the Associated Press reported last week.
The other public companies returning PPP loans include:
- IDT Corporation ($10 million)
- Aquestive Therapeutics ($4.8 million)
- OptiNose ($4.4 million)
- Ultralife Corporation ($3.4 million)
- Ballantyne Strong ($3.1 million)
- BK Technologies Corporation ($2.1 million)
- BioLife Solutions ($2.1 million)
Scores of public companies snagged at least $870 million in PPP loans as the program burned through its initial $349 billion budget in just two weeks, according to FactSquared data. The Small Business Administration was set to start accepting loan applications again Monday morning after Congress approved $310 billion in new funding last week.
The US Treasury Department warned last week that public companies with “substantial market value and access to capital markets” would be unlikely to qualify for the program because they could not say “in good faith” that they needed the loans to keep operating amid the pandemic.
But firms run by one of the program’s biggest beneficiaries — hotel tycoon Monty Bennett — have no plans to give back the money. Bennett is tied to three publicly traded hotel companies that said they applied for $126 million in loans through various subsidiaries.
“The PPP program was specifically designed to help companies like ours as part of the national objective of shoring up businesses and getting people back to work,” the companies — Ashford Inc., Ashford Hospitality Trust and Braemar Hotels & Resorts — said in a statement. “We … intend to use the PPP funds to do our part.”
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