The Securities and Exchange Commission said it has settled charges against Cheesecake Factory Inc. for misleading investors about how the Covid-19 pandemic affected the restaurant chain.
The SEC said the company in the spring filed materially false and misleading disclosures saying that locations were “operating sustainably.” Meanwhile, the company was losing about $6 million in cash weekly and estimated it had only about four months’ worth of cash left, according to the agency.
The SEC also said the company didn’t disclose that it had told landlords it wouldn’t pay rent in April because of the pandemic’s impacts.
The Cheesecake Factory didn’t admit to the SEC’s findings but agreed to a penalty of $125,000, the regulator said Friday. The company didn’t immediately respond to a request for comment.
The restaurant chain one of a number of large companies that either warned they would withhold rent payments or stopped paying rent in the spring. It also furloughed more than 40,000 hourly staffers and closed more than two dozen locations early in the pandemic.