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Is it mandatory to vacate a store rented out by a merchant whose lease term has not yet expired? Yonghui Supermarket in the whirlpool has new 'troubles' again

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Yonghui Supermarket (601933. SH), which has been in a whirlpool of public opinion recently, has encountered new "troubles".
On September 28th, Yonghui Supermarket's Sina Weibo released an explanation on the equity change of Yonghui Supermarket Co., Ltd., emphasizing that the equity ratio of its founder and chairman, Mr. Zhang Xuansong, has not changed and that Pangdonglai will continue to assist Yonghui Supermarket in its adjustment.
While Yonghui Supermarket is undergoing major adjustments, some tenants who were once associated with Yonghui Supermarket are facing difficulties.
On September 27th, several tenants of Yonghui Supermarket's Langyue Park Maodian (hereinafter referred to as "Park Maodian") in Zhengzhou City told Red Star Capital Bureau that the Yonghui Supermarket had recently been notified to withdraw and move out due to restructuring, and they were unwilling to compensate. And the contract they signed with Yonghui Qishi has not yet expired.
A store needs to be adjusted

Request merchants whose lease term has not yet expired to withdraw

After learning that Yonghui Supermarket, which has been adjusted by Fat East, does not have any leased areas, the tenants of Yonghui Supermarket Park Mall in Zhengzhou have concerns.
(Photo by Red Star Capital Bureau, Maodian Rental Area, Zhengzhou Langyue Park, Yonghui Supermarket)

Ms. Zuo is one of them. On September 27th, she told the Red Star Capital Bureau, "After the renovation and opening of Yonghui Supermarket Xinwan Square Store (Reporter's note: Pangdonglai renovated Yonghui Supermarket's first store), (we) went to see if the renovated store did not have an external rental area. At that time, everyone guessed whether the external rental area was gone. Later, the store that opened on Dongfeng Road also did not have an external rental area, and everyone was convinced that there was no external rental area anymore
Ms. Fu, a merchant, told Red Star Capital Bureau that on August 20th, she asked Yonghui Supermarket if they were about to make adjustments. If they were, they planned to handle the goods and find new stores. They said it was a rumor. In early September, there were other merchants handling the goods, but Yonghui's people refused
According to Ms. Zuo's recollection, in late August, the staff of Yonghui Supermarket held a meeting with their rented merchants and told them that the supermarket may close for renovation before the end of September. At that time, I didn't tell everyone whether or not to let the outside field work. The language was vague, and there was no confirmation at all. There was no formal notification
It is understood that many tenants who have not yet moved out of the Yonghui Supermarket store signed contracts in April this year, with a lease term of one year, expiring at the end of March 2025.
Merchant image provided

The day before yesterday (September 26th), they informed me to quickly find a storefront, "Ms. Fu said. The merchant at the milk tea shop in front of the supermarket told Red Star Capital Bureau, "We only notified the store to be closed on the 26th, and the water and power will be cut off at 8am on the 30th. We can't handle the equipment and materials, what should we do
I didn't do my business well in August. Although I paid the rent, they either wrote letters or did various things every afternoon. One day, they even cut off the power for me, and I called the police directly, and then immediately called, "said Ms. Zuo.
Multiple merchants have informed Red Star Capital Bureau that Yonghui Supermarket has recently issued a notice stating that water and power outages will occur on September 30th.
Multiple merchants claim that compensation has not been negotiated
is also required to pay late fees

Ms. Fu told Red Star Capital Bureau that on the afternoon of the 27th, the supermarket contacted some tenants to discuss matters related to the relocation. At the meeting, the supermarket asked tenants to sign a voluntary agreement to leave and voluntarily terminate the contract, and stated that the deposit would be given to the merchant after leaving. I asked them to pay the deposit before the withdrawal, but they only said they had to go through the procedure. Later, I didn't sign the agreement, and the supermarket's investment department threatened not to let me sign it tomorrow. I also asked them about compensation, but they said they didn't compensate
I only spent 70000 to 80000 yuan to renovate my store last year, and I hope they will compensate me for the renovation money, "Mr. Zhang told Red Star Capital Bureau.
Mr. Meng told Red Star Capital Bureau that he became an external tenant of Yonghui Supermarket in 2022 and invested a total of over 400000 yuan, with nearly 200000 yuan spent on decoration alone. We don't really want to relocate at this point. We haven't made any money in recent years, so we don't have any more money to open a new store
Ms. Zuo also expressed the same distress to the Red Star Capital Bureau: "The main reason is that we don't have enough money to open a store anymore
According to multiple merchants, the compensation issue has not been settled yet, and Yonghui Supermarket suddenly notified them to pay a penalty for breach of contract. Previously, we paid rent on a quarterly basis. However, due to the pandemic and business difficulties, the supermarket allowed us to pay one month's rent each time. At first, we paid the rent for the next month in advance, but later we paid the rent for the current month every month, and they didn't say anything about it. We have been paying for more than a year now. But recently, the supermarket said we had breached the contract and had to pay a penalty, "Mr. Lei, a merchant, told Red Star Capital Bureau.
Merchants Mr. Zhang and Ms. Zuo also mentioned a similar situation, stating that Yonghui Supermarket not only did not mention compensation, but also demanded that they pay late fees. They described the reason for the late fee as the same as Mr. Lei said, which was to change from quarterly payment to monthly payment. They said they could pay once a month, but now they say they haven't fulfilled the contract, "said a merchant.
If we had breached the contract, they should have kicked us out a year ago. So many merchants have been paying like this for over a year, "Mr. Lei said.
Yonghui: Will communicate and coordinate with merchants

Lawyer: If the breach of contract causes losses to the merchant, compensation must be made
Red Star Capital Bureau called to interview Ms. Jiang, the investment manager of the Yonghui Supermarket store, and asked her when the Park Mall store is expected to close for renovation? What date does Yonghui Supermarket Park Mall require tenants to vacate before? Will the merchants be cut off from water and electricity at 8am on the 30th? Will the deposit be refunded and how can it be refunded? How to solve the issue of merchant compensation? How are late fees generated?
Ms. Jiang did not provide a positive response and stated that she is not in an external position and cannot be interviewed.
According to the "Urban Report" program of Henan Radio and Television Station on September 24th, Ms. Jiang said, "We are currently cooperating with Pangdonglai, and all stores will make some adjustments based on business needs. The merchants of Gongyuanmao should have already informed us in advance in June or July that there may be adjustments, because we ourselves do not know. The rectification time has not been set, let's wait for the announcement." Ms. Chen, the person in charge of Yonghui Supermarket's Henan headquarters, said, "We must be responsible for the merchants. Whether to make specific adjustments or not, there will be a clear explanation at that time
On September 28th, Red Star Capital interviewed Yonghui Supermarket regarding the issue of whether compensation will be given to the tenants during the lease term of the Park Mall store, how compensation will be made, and how late fees will be incurred. Yonghui Supermarket stated, "The plan for the adjustment of the Park Mall store is still under discussion and development, and we will communicate and coordinate with the tenants
On September 28th, Lawyer Mao Wei, Senior Partner and Director of the Capital Market Department of Beijing Jingshi Law Firm, told Red Star Capital Bureau: "If it is during the lease term and there is no special termination clause stipulated in the contract, it is definitely a breach of contract. The penalty for breach of contract can only be claimed if it is stipulated in the contract. According to the Civil Code, if the breach causes losses to the merchant, compensation must be made
Lawyer Hu Gang from Chaoyang Law Firm in Beijing told Red Star Capital Bureau that the early clearance of tenants by Yonghui Supermarket is suspected of breach of contract, but the specific details depend on the contract agreement and the legality of the agreement itself. Supermarkets should compensate according to actual losses. Merchants can unite and collectively hire local professional lawyers to negotiate, settle, file administrative complaints, and even civil lawsuits
Yonghui Supermarket 'sold' to Miniso

A tenant wants to ask Pang Dong for help

Red Star Capital Bureau has noticed that Yonghui Supermarket currently has three relocated stores in Zhengzhou.
On the evening of September 23rd, Miniso (09896. HK) announced the acquisition of shares in Yonghui Supermarket. After the acquisition was completed, Juncai International, controlled by Miniso, became the largest shareholder of Yonghui Supermarket. As soon as the news came out, Yonghui Supermarket hit the daily limit up on the 24th, and its stock price rose for four consecutive days. On September 27th, the stock price of Yonghui Supermarket rose by 10% to 3.30 yuan per share.
During the conference call after the announcement of the acquisition, Ye Guofu, the chairman of Miniso, repeatedly mentioned the restructuring of Pangdong.
Regarding the acquisition of shares and the change of the largest shareholder, Ms. Pei, a consumer, told Red Star Capital Bureau on September 27th after visiting the third Pangdong store in Yonghui Supermarket to help with the adjustment, "This is my first time here, and I won't come again next time, it's related to recent news. Yonghui Supermarket is not authentic, Pangdong came to help them adjust, and he sold the shares. In addition, after this visit, I found that there are still significant differences between Yonghui and Pangdong after the adjustment
Several staff members of the adjustment store expressed their concerns about this matter to the Red Star Capital Bureau. Some staff members said, "Currently, the online reviews are not very good, and our customers definitely value this thing. If online reviews and customers feel that this matter is not good and they will not come to buy things, then our bonus will be lost
According to a report by Dahe Caili in May, it was reported that Yu Donglai, the founder of Pangdonglai, visited Yonghui Supermarket Park Maodian in Zhengzhou.
The owner of a milk tea shop rented outside Yonghui Supermarket Park Maodian told Red Star Capital Bureau that "a group of people came to see the shop for several days in a row, but haven't seen anyone these days". Ms. Zuo said, "We originally wanted to talk to the people from Pangdong, but we couldn't find them. If their people came, Yonghui Supermarket probably wouldn't dare to do this
Red Star News reporter Zhang Luxi
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