Sushi Chain Returning $6 Million Small-Business Loan to U.S.
(Bloomberg) -- Another public company is returning a loan from a U.S. government stimulus fund meant for small businesses.
Kura Sushi USA, Inc., a restaurant chain with 25 locations in five U.S. states, is giving back about $6 million in proceeds, according to a regulatory filing. The company said it had entered into the lending agreement last week.
The company joins Shake Shack Inc. and Sweetgreen Inc. in returning loans after media reports pointed out that several large firms had received financial support. The stimulus program being run by the Small Business Administration was aimed at firms with as many as 500 employees. But a lobbyist-backed loophole allowed for restaurant chains to receive funds.
A second round of funding aims to limit large companies from applying.
Kura has about 1,400 workers and annual sales of $64 million. All its restaurants have been closed because of the coronavirus. To combat that, last week it entered into a $20 million revolving credit facility.
The company, based in Irvine, California, didn’t immediately respond to an request for comment.
In a letter posted on the company’s website, Chief Executive Officer Jimmy Uba said the company initially interpreted the bill as “a deliberate effort by lawmakers to further support the restaurant industry, whether you have one or multiple restaurants.”
When it became clear the funds wouldn’t be enough for everyone, the company returned the loan because “our finances allow us to weather financial hardship for a longer period than independent restaurant owners,” Uba said.
The Washington Post earlier reported Kura Sushi’s decision to return the funds.
©2020 Bloomberg L.P.