Grand Rapids Large Company Obtained $ 29 Million Federal Payroll Loan


GRAND RAPIDS, Michigan (WOOD) – A Grand Rapids-based restaurant company is one of the largest companies that received millions from a federal loan program aimed at helping small businesses get through closures aimed at slowing the spread of the coronavirus. .

Meritage Hospitality Group Inc., which owns the Wendy’s, Twisted Rooster and other restaurant franchises, received $ 29.1 million from the Paycheck Protection Program.

Meritage CEO Robert Schermer Jr. declined an interview with News 8 on Wednesday. Instead, a spokesperson released a statement saying, in part, that the loans are necessary to pay employees amid a “significant recession in business as restaurants and canteens remain closed …”

The company said it was taking “significant proactive steps to ensure it remains strong, resilient, and well-positioned to support employees, guests, and other stakeholders during the COVID-19 crisis.”

According to a company press release, 329 of its Wendy’s restaurants “remain open for self-service and delivery.”

Financial records show that Meritage made a profit of about $ 13 million in 2019 and that both the CEO and the president made about $ 1.9 million (not including stock options).

According to the company’s websiteMeritage has more than 330 restaurants in 16 states and 11,000 employees. It’s hardly what you would consider a small business, but as a result of a hard-pressed exception, APP loans were opened to chains and other large companies. As long as the money is used for payroll and other specific uses, companies can keep the cash free and clean. If not, it must be returned with 1% interest.

News 8 is still waiting for an application for the full list of West Michigan businesses that received loans and how much they obtained.

Meritage’s full statement provided to News 8:

“Meritage Hospitality Group, based in Grand Rapids, and its many subsidiaries, operates 337 restaurants in 16 states. Each of the company’s Wendy’s restaurants employs an average of 30 to 35 people. Paycheck Protection Program (PPP) loans were sought to allow each subsidiary entity to pay its employees during the significant recession in business, while restaurants and canteens were closed due to the COVID-19 shutdown mandates and ‘Stay Home’ orders.

“Seventy-five percent of the proceeds will be used for payroll costs and the remainder for rent and utility payments as defined by the US Small Business Administration.”

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