Luckin Coffee Chairman, CEO Default on Loan; Lenders to Seize Stock Holdings

Luckin Coffee (NASDAQ: LK) seems to be getting into more hot water. On Monday it was reported that the company's chairman and its CEO are being forced to hand over a pack of shares after defaulting on a loan.

Haode Investment, a company controlled by chairman Charles Zhengyao Lu, defaulted on a $518 million margin loan to a syndicate of banks, according to a press release issued by one of the syndicate members, American investment bank Goldman Sachs (NYSE: GS).

Nearly 611 million shares of Luckin Coffee stock have been pledged as collateral in the loan, Goldman wrote, which includes shares pledged by the family trust of the company's CEO, Jenny Zhiya Qian. Over 515 million shares of that stock are Class B ordinary shares.

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Source Fool.com