Adam Bierman Archives - Green Market Report

Debra BorchardtMarch 28, 2023


MedMen (OTC: MMNFF) will have to pony up more than $3 million for its co-founder and former CEO Adam Bierman.

An arbitrator ruled that Bieman was entitled to $3,063,300, plus costs of $49,243.34, for a total award of $3,112,543.34 related to his separation from the company. The base award represents the value of Bierman’s super voting shares and a bonus of 12 million common shares, as of August 2020.

Beleaguered MedMen was once billed as the first unicorn of cannabis, meaning the company had a billion-dollar valuation before going public, but now it is selling off parts and drowning in debt.

“After three long years, I’m glad the truth has come out and that I can finally share my story,” Bierman said. “The court found MedMen, as well as the former executive chairman, guilty of fraud. This judgment completes the factual narrative as I passionately chased the end of prohibition.”

However, the win could be cold comfort for Bierman as MedMen recently reported that it has a working capital deficit of a whopping $137 million and noted that it is a going concern. Medmen stated that it had already defaulted on debt with a senior lender and would need to obtain an extension or refinance.

The company has just $15 million in cash and equivalents on the books and a market cap of only $25 million. The stock was selling for less than two cents a share.

$2 Billion

According to the court document, MedMen went public on May 29, 2018, with its stock first listed on the Canadian Securities Exchange.

Days before the IPO, Bierman, as CEO of MedMen, executed an employment agreement for himself, which provided among its benefits:

  • $1.5 million in base salary.
  • An equity grant based on a time vesting schedule.
  • A special IPO bonus of $4 million if the company reached a $2 billion valuation.

Bierman received the valuation bonus in September 2018.

However, the company never revisited those lofty valuations. The stock was selling at roughly $3.54 at the beginning of 2019 but plunged to just roughly 53 cents by the end of 2019.

MedMen Falls

During this time, however, MedMen experienced some setbacks.

Before the IPO, MedMen agreed to buy PharmaCann, but the deal ultimately fell apart in fall 2019. MedMen’s stock fell, and the company needed to restructure as it cycled through several chief financial officers.

The final award statement claims that it was the failure of that deal that caused the stock price to fall, but the company also was reporting heavy losses and not paying its vendors. In addition, the co-founders were accused of enriching themselves as the company struggled.

“In December 2019, an investor died before completing his $20 million investment into the company. Initially, Ben Rose committed that Wicklow Capital, MedMen’s then-largest equity investor, would make up this shortfall. Rose was both a representative of Wicklow and executive chairman of MedMen. But the commitment soon morphed into an ultimatum: To obtain the cash infusion on Christmas, Bierman, Modlin, and Ganan had to sign personal guarantees on the money, or Wicklow would allow MedMen to miss payroll and other obligations. In May 2019, Bierman reduced his salary to $50,000 and changed his equity grant to be discretionary and based on performance, for ‘investor sentiment morale,'” the statement read.

Bierman’s Fiery Exit

According to the statement, on Jan. 24, 2020, Bierman called Rose to tell him he was thinking of stepping down as CEO.

“The next Monday (Jan. 27), Bierman met with Rose and John McCarthy, Wicklow’s general counsel, at MedMen’s offices to negotiate the terms of Bierman’s exit. … At times Rose chastised and cursed at Bierman. And at some point, the negotiations became so contentious that Ganan had to physically restrain Rose when he got up and moved as though he was going to strike Bierman.”

However, despite an oral agreement between Rose and Bierman for 18 million shares, the written separation agreement made no mention of Bierman’s right to a specified number.

According to the board minutes, it was determined that the consideration MedMen would pay Bierman to surrender his super voting shares would be put “through a more rigorous valuation process.”

Super Voting Value

According to the final award statement, Equity Methods valued the super voting shares at $951,300. FW Cook, on the other hand, valued the 2019 excess contribution at about negative $4.9 million, essentially concluding that no compensation was owed to Bierman for this portion.

Bierman contended that MedMen breached the separation agreement in three main ways:

  • Relying on the Equity Methods report, which contained manifest errors, to value the super voting shares.
  • Relying on the FW Cook report, again with manifest errors, to value the 2019 excess contribution.
  • Failing to issue any shares or cash for the super voting shares.

The arbitrator ruled that the Equity Methods report did not contain manifest errors and also denied Bierman’s request for “a multiple of two and a half times the 3.7 million shares” owed to him, because the claimed fraud was not “proven by clear and convincing evidence.”

With this case behind him, Bierman said he is looking at getting back into the cannabis game, noting that he is working on a few projects. One is a new retail concept based on the convenience store model with low overhead and higher margins.

Debra BorchardtJanuary 31, 2020


MedMen Enterprises Inc.  (CSE: MMEN) (OTCQX: MMNFF) announced that its Co-Founder and Chief Executive Officer Adam Bierman is stepping down as CEO effective February 1, 2020. Bierman is also giving up all of his Class A super voting shares as part of the deal.

After giving up these shares, MedMen said that Bierman will have 1,893,047 Subordinate Voting Shares and 3,956,324 redeemable shares of MM CAN USA, Inc., each of which is redeemable for one Subordinate Voting Share. Bierman will own 4.8% of the company with an equal amount of voting power.

Bierman’s Co-founder Andrew Modlin has granted a proxy of all of his Super Voting Shares to the company’s Executive Chairman, Ben Rose until December 2020. Mr. Modlin has also agreed to surrender all of his Super Voting Shares to the company, which would occur upon the expiration of the proxy granted to Mr. Rose. Modlin will own 4.9% of the company with an equal amount of voting shares.

Readers may recall that when MedMen went public, the company faced a storm of criticism that the two leaders essentially gave themselves total control of the company with the bulk of the voting shares. New shareholders basically had no say in the company and had no way to voice displeasure in the running of the company as they had no way to vote.

Lissack Named Interim CEO

MedMen’s Chief Operating Officer & Chief Technology Officer, Ryan Lissack was named Interim CEO. The Board of Directors has said that it is forming a committee to identify and appoint a new CEO. 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.

“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. This evolution will provide Adam the space to contribute to the future of MedMen and extend his commitment to the industry that he has helped pioneer,” said Executive Chairman Ben Rose.

“I continue to believe that MedMen is positioned to thrive. It’s time for our next iteration of leadership to capitalize on the opportunity we have created. This has been an incredible journey and I will continue to be inspired by those around the globe working to make our world safer, healthier and happier through access to legal, regulated cannabis,” said Adam Bierman.

MedMen’s most recent stumble was its inability to pay vendors. When the news first began leaking out from companies stating that their bills were not getting paid and that the company was negotiating payment, MedMen claimed the stories were “not factual.” However, Bierman did concede to Green Market Report that in fact, the stories were true.

The company has faced criticism for his extreme spending habits and its insatiable need for more capital. That most recent rounds of funding though came at the cost of overseeing the management of the company.

Constant Crisis in C-Suite

MedMen seemed to constantly be putting out fires in the C-Suite and many of its own making. MedMen originally began as an investment company, but then it pivoted to become a retailer and described itself as the Apple store of cannabis. The stores became known for slick interiors and styling – the opposite of a “head shop.”

The company’s IPO though was awash in controversy and from day one, it seemed the company could never operate on stable ground. The hubris of awarding the majority of the voting shares to the founders was topped by the billion-dollar valuation for a company that only brought in low double-digit millions in revenue.

It seemed scandal after scandal engulfed the management. There was the employee tax issue, where employees were hit with a lower paycheck, which was blamed on a miscalculation of taxes due to the fast growth of the company. That was followed by a $20 million shareholder lawsuit.

The lawsuit claimed, “The MedMen veneer is a complex web of interconnected subsidiary entities, virtually all of which are directly managed, directed, controlled, and owned by BIERMAN and MODLIN, and all of which always pursue the best interests of BIERMAN and MODLIN, rather than the best interests of any stakeholder or entity. It is that perverse interconnectedness and rampant, brazen self -dealing that renders the actions of BIERMAN and
MODLIN, and of the Entity Defendants, unlawful.”
Parker Lawsuit
That lawsuit was small potatoes compared to the explosive allegations from former CFO James Parker. Parker resigned from the company in November less than a year after the company began trading on the Canadian Securities Exchange following a reverse take over. It’s highly unusual for a company to experience a change at this level so quickly after becoming a publicly-traded company.

Parker says that he to “Choose between complying with his fiduciary duty to the company and its shareholders or turning a blind eye and a deaf ear to improper and unlawful behavior, he had been constructively and wrongfully terminated without cause and in violation of public policy.” Parker claims MedMen went behind his back to begin searching for a new CFO and diminished his authority within the company. He also complained that the company instructed him to make payments that he questioned.

Parker also made serious securities violation claims saying:

  • “Ordering Plaintiff to wire hundreds of thousands of public dollars to a “consultant” in Canada to “buy up our stock when it is under attack”
  • “Ordering Plaintiff to pay prohibited success fees to unlicensed broker-dealers for various fundraising efforts, under the semblance of “consulting agreements”
  • “The CEO and President not being fully transparent about non-arm’s length deals with numerous related parties (including Pharmacann and Captor Capital)”
  • “The CEO and President failing to publicly disclose all Named Executive Officers and other Material Officer compensation packages (in violation of Canadian National Instrument Form 51-102 F6 which requires that the compensation of the CEO, CFO and next three highest-paid executives be publicly disclosed)”

The company had also made a lot of noise about its impending acquisition of PharmaCann and how that deal would make it the largest multi-state operator in the country, but the deal was never closed and was recently terminated.


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