What: Shares of Shake Shack (NYSE:SHAK) were down 8.6% as of 12:15 p.m. Thursday after the burger chain announced lower-than-expected pricing for a secondary offering.

So what: Shake Shack initially announced the proposed offering of 4 million shares of common stock (as well as a 30-day option for the underwriters to purchase up to 600,000 additional shares), shortly after releasing better-than-expected second-quarter results on Monday. However, Shake Shack also stated the company "will not receive any proceeds from the sale of the shares by the selling stockholders," leaving the market to assume the secondary's aim was to allow insiders to sell shares previously tied up due to restrictions surrounding its recent initial public offering.

In addition to the dilutive nature of the offering, however, today Shake Shack revealed those shares were priced at $60.00 per share, a significant discount to yesterday's close at $64.79 per share.

Now what: To be fair, that's still well above Shake Shack's IPO price at $21 per share. But considering the stock has also pulled back hard from its May highs above $92 per share, its little solace to investors given the seeming lack of loyalty from insiders fleeing at today's levels. For now, that's why I'm content continuing to watch Shake Shack stock from the sidelines.

Steve Symington has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.