Chinese beverage chain Luckin Coffee replaced founder and former chairman Charles Lu with its acting CEO, Guo Jinyi.
Luckin apologized to its employees for the upheaval following its fraud admission in early April, and on the same day removed its CEO and COO.
Luckin is being investigated in the US for defrauding investors amid pressing concerns to recoup a dropoff in sales as a result of Covid-19.
The default followed almost immediately after Luckin disclosed that its head of operations had fabricated billions of RMB worth of sales for most of 2019.
If the deal proceeds, Luckin founder Charles Lu and his family will receive up to HK$1.37 billion, likely to be put toward the company’s cash crunch.