MedMen CEO Steps Down; To Surrender Super Voting Shares

Struggling cannabis retailer MedMen Enterprises Inc. said that its co-founder and chief executive officer Adam Bierman has decided to step down from his role as CEO, effective February 1, 2020. Shares of MedMen gained more than 9 percent in the regular trading session on Friday.

The California-based company's board of directors has appointed Chief Operating Officer & Chief Technology Officer Ryan Lissack as interim CEO.

The board will form a committee of directors to appoint a new CEO. The committee expects to consider internal as well as external candidates and might engage a national search firm to aid in its efforts, MedMen said.

Bierman has agreed to continue to serve on the company's board of directors, including as part of the board to be elected at the company's upcoming shareholder meeting. In addition, Bierman will surrender all of his Class A super voting shares back to the company, MedMen said.

Last year, MedMen's co-founder Andrew Modlin granted a proxy over all of his super voting shares to the Executive Chairman Ben Rose until December 2020. Modlin too has agreed to surrender all of his super voting shares to the company, which would occur upon the expiration of the proxy granted to Rose.

The super voting shares had granted Bierman and Modlin more voting rights than other MedMen shareholders, giving the co-founders the power to control the company.

Following the surrender of the super voting shares by the end of 2020, MedMen will have only one class of outstanding shares, the Class B subordinate voting shares that entitles each shareholder to one vote.

"The Board supports both Adam's decision to step aside for a new CEO to lead the Company, and his and Andrew's decision to surrender their voting rights to give all shareholders a stronger voice," said Executive Chairman Ben Rose.

In October 2019, MedMen said it decided to terminate a deal to acquire marijuana company PharmaCann LLC in all-stock transaction, citing market developments over the past twelve months and the continued evolution of its business strategy.

MedMen also laid off 190 employees as part of a restructuring, amid concerns about the company's finances. In addition, the company reportedly offered to pay vendors in company stock instead of cash.

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