Shake Shack, the fast-food chain, said on Sunday that it was returning a $10 million loan from a federal program to help small businesses, following criticism that the stimulus program had favored large chains.
The $349 billion stimulus effort, which was distributed on a first-come, first-served basis, was exhausted in just two weeks, with many loans favoring larger companies that were better able to navigate the application process.
Paycheck protection program loans from the Small Business Administration will be forgiven for companies that do not lay off staff or that rehire them by June 30.
Shake Shack, with 189 outlets and nearly 8,000 employees in the United States, said that it had secured the additional capital it needed through an equity transaction on Friday.
“We’re thankful for that, and we’ve decided to immediately return the entire $10 million P.P.P. loan we received last week to the S.B.A. so that those restaurants who need it most can get it,” the company said in a statement from Danny Meyer, the chairman of Shake Shack, and Randy Garutti, its chief executive.
The company said the loan program should be fully funded in order to not pit restaurants against one another. It called for scrapping the June forgiveness date in favor of staggered deadlines to reflect how the epidemic has hit different parts of the country at different times.