Liberty Health Sciences Inc. (CSE: LHS) (OTCQX: LHSIF ) announced that Victor Mancebo has resigned from the Board of Directors and his role as Chief Executive Officer, effective December 31, 2020. George J. Gremse, a member of the Board of Directors, has been appointed as Interim CEO during the process of identifying a permanent CEO.
This comes after shareholders expressed dissatisfaction with the company’s disappointing cannabis production in the state of Florida. A recent state report from the Office of Medical Marijuana dated October 16-22 showed that Liberty, with 26 dispensing locations, had produced only 3,937,111 mgs of medical marijuana with THC. AltMed Florida, which also has 26 locations, produced 14,854,911 mg. of medical marijuana with THC. The same report listed Liberty as producing 1,189,520 ounces of “marijuana in smoking form” while AltMed produced 3,410,551 ounces. Sales also fell as the same report showed that Liberty’s sales fell 26% in the THC category, but rose 75% in flower sales. However, Liberty only sold 1,200 ounces of flower versus AltMed’s 3,400 ounces of flower.
One shareholder by the name of James Baker suggested organized shareholder activism. He reached out on Twitter to ask if others wanted to join his efforts in sending a letter to the board of directors.
Such activism will gain the attention of the financialpress and be far more weighty than individuual complaints, which obviously fall on deaf ears are are ignored.
Earlier this week, Liberty asked its debt holders for a 12-month extension on Senior Secured Convertible Debentures from the original November 22, 2020 maturity date (that were originally issued on November 22, 2017). They were offered to increase the interest from 12% to 13%. $6 million is currently outstanding. Debenture holders that don’t choose the extension are said to be repaid from existing funds held at the company.
For its part the company said in a statement, “We are grateful for Victor’s leadership and contributions to Liberty,” said Chairman William R. Pfeiffer. “As a Board Member and an Officer of the company Victor was instrumental in building Liberty into the company that it is today with a network of dispensaries spanning the state of Florida. We thank Victor for those efforts and wish him the very best on all his future endeavors.”
Gremse has held senior management positions in both Fortune 500 companies and start-ups. He holds a degree in agriculture from Cornell University and an MBA from Baruch College of the City University of New York.