MedMen Archives - Green Market Report

Debra BorchardtDebra BorchardtMarch 1, 2021


MedMen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) didn’t completely sell its New York operations to privately held Ascend Wellness, but it’s pretty close. Last week, beleaguered California-based cannabis operator MedMen signed an agreement with Ascend Wellness Holdings, where Ascend would make an investment of approximately $73 million in MedMen NY Inc. or MMNY. MedMen’s shares jumped over 14% in trading on Friday to lately sell at 48 cents.

Following the investment, Ascend will hold a controlling interest in MMNY of approximately 86.7% and will have an option to buy MedMen’s remaining interest in MMNY in the future. Also in the agreement, Ascend must also make an additional investment of $10 million in exchange for additional equity in MMNY. This investment will also be used to repay MMNY’s senior secured lender if adult-use cannabis sales commence in MMNY’s dispensaries.

“We believe the proposed transaction will bring fresh capital and a new perspective to New York’s medical marijuana program and its patients,” said Abner Kurtin, Founder of Ascend Wellness. Ascend Wellness is a vertically integrated operator with assets and partners in Illinois, Michigan, Ohio, Massachusetts and New Jersey. Ascend produces and distributes Ozone branded products.

Of course, all of this is subject to approval from the New York State Department of Health and other applicable regulatory bodies. The state did not approve of MedMen’s attempt to acquire PharmaCann’s operations in New York back in the day, so nothing is ever certain. That deal was scrapped back in 2019. MMNY will also use Ascend’s services for a management agreement under which Ascend will advise on MMNY’s operations pending regulatory approval of the Investment transaction.

Agreement Terms

The details of the deal say that MMNY will assume up to approximately $73 million of MedMen’s existing secured debt, Ascend will invest $35 million in cash in MMNY, and AWH New York, LLC will issue a senior secured promissory note in favor of MMNY’s senior secured lender in the principal amount of $28 million, guaranteed by Ascend, which cash investment and note will be used to reduce the amounts owed to MMNY’s senior secured lender. 

Cowen & Co. Drops Coverage

Cowen & Co. discontinued coverage of MedMen in December of 2020. In her last report, Vivien Azer wrote, “MMEN delivered $20.7 mm in revenue from its 11operating CA stores, up ~34% QoQ and implying ~$1.9 mm per door in the quarter (implying$7.5 mm per door annualized), which we believe is roughly in line with management targets for CA store sales productivity. Meanwhile, NV sales were up triple digits sequentially(192%) due to the cycling of temporary store closures in the prior quarter. MMEN’s OakPark door in IL was the highest growing of the portfolio and we estimate this door could achieve ~$15 mm in revenue annualized.”

She added, “Despite the improvement, MMEN’s cost structure is still bloated and a heavy debt burden may force management to seek dilutive solutions.” 

Debra BorchardtDebra BorchardtFebruary 17, 2021


MedMen Enterprises Inc. (OTCQX: MMNFF) delivered its consolidated financial results for its second-quarter fiscal 2021 ending December 26, 2020. Net revenue across MedMen’s operations in California, Nevada, New York, Illinois, and Florida was $33.8 million for the second quarter, up 0.3% sequentially excluding Evanston. Still, the company delivered a net loss of $68.9 million which included $24.0 million of tax provision expense, compared to a net loss of $93.2 million which included a tax provision benefit of $14.6 million in the same period last year.

“This past quarter was one of continued progress. We have continued to add depth to an already strong management team, we have maintained the support of our capital partners, and we continue to outpace the cost-cutting outlined in our turnaround plan,” said Tom Lynch, Chairman and Chief Executive Officer of MedMen. “Our company revenue growth temporarily slowed due to retail restrictions in California, but we see consistent momentum across our portfolio, and our significant gross margin expansion is a strong indicator of how we are continuing to build a platform for sustainable future profitability. Over the next several quarters we plan to accelerate our growth on the foundation of our strong brand recognition and the tremendous improvements we have made in operational efficiency and discipline.”

The company reported that the general and administrative expenses were $33.8 million in the second quarter, a 47% decrease from the same period last year. However, revenues are barely covering the company’s expenses.

Company Finances

As of December 26, 2020, the company said it had total assets of $503.6 million, including cash and cash equivalents of $7.5 million. MedMen also announced the execution of subscription agreements with certain institutional investors for the sale of up to approximately $5.8 million of units at a purchase price of $0.3713 per Unit. The stock is currently trading near 46 cents. The Private Placement will be completed in tranches, with the initial tranche consisting of 7,800,000 Units for aggregate gross proceeds of $2.9 million. On December 17, 2020, the company named Reece Fulgham as Interim Chief Financial Officer. On the company’s earnings call Fulgham said, “As Tom mentioned, we did raise an additional $10 million from Gotham Green Partners in January and we will continue to work closely with our Capital Partners to fund the final stretches of our turnaround plan. We also announced this month we are partnering with Moelis a strategic advisor as we look to potentially diversify our funding sources and deleverage our balance sheet.”

A few weeks ago, reported that a California judge again ordered MedMen to pay its former chief financial officer at least $500,000 to cover his legal fees in an ongoing lawsuit over whether the executive was wrongly terminated. James Parker’s employment contract mandated that MedMen pay his legal fees in the event of a legal dispute, which resulted in the notoriously worded lawsuit that exposed many of the company’s darkest flaws.

Cowen Drops Coverage

Cowen & Co dropped analyst coverage on MedMen last week. Analyst Vivien Azer wrote in her last report dated in December, “We take our FY21 estimate to $168.5 mm, and leave our FY22top line estimate unchanged at $216 mm. We raise our GM outlook meaningfully given the progress made this quarter and believe that MMEN could post a ~50% gross margin in FY22assuming continued to benefit from its buying processes, coupled with slightly more stability in markets like MA and IL from a wholesale perspective. We raise our PT to $0.20, implying a 2.8x EV / FY2 revenue multiple. Maintain Market Perform.”

Looking Ahead

On the earnings call, Lynch said, “Finally, last quarter, I hit on my excitement around the acceleration of growth in existing markets such as California and Florida, where we have a number of high profile stores set to open over the next 10 months, as well as new markets like Massachusetts, where we have some of the best locations in the state. We’ve been slightly delayed in our Emeryville openings in California and our opening in Miami Beach, who are hard at work to get those doors open in the next several months.”

“We’re on schedule for two openings in San Francisco, our two openings in Massachusetts, and our significant pipeline of openings in Florida on the back of our ongoing Eustis expansion. We believe we have the ability to open up to an additional 10 stores in Florida this year. And we view our growth strategy there as one of the most exciting opportunities we given our ability to open an unlimited number of dispensaries as we continue to execute in cultivation and manufacturing. We appreciate the patience and support of stakeholders as we continue to execute. And we strongly believe that patients will be rewarded for the bright future ahead of us.”

Debra BorchardtDebra BorchardtDecember 8, 2020


After the market closed on Monday, MedMen Enterprises Inc.(CSE: MMEN) (OTCQX: MMNFF) released its consolidated financial results for its first-quarter fiscal 2021 ended September 26, 2020. The company delivered a sequential growth of 31% on revenue of $35.6 million, however, it declined from $39.7 million for the same time period in 2019. On a positive note, the net losses were trimmed to $21.9 million from last year’s $33.1 million.

On the MedMen earnings call Interim Chief Executive Officer Tom Lynch said, “This is also the first quarter in which we achieved positive cash flow after-tax across our retail footprint, a significant milestone for the team. With the strength of our team and support of our capital partners, we are ahead of schedule with respect to our turnaround plan. As we get closer to achieving company-wide profitability, we remain committed to growing the MedMen brand and maintaining our position as the leading cannabis retailer in the U.S.”

The company noted that the increase in revenue was driven by its California footprint, which was up 34% this quarter over the previous quarter. The flagship stores, such as LAX, Beverly Hills, and West Hollywood were up 56%, 39%, and 31%, respectively, during the quarter. The company only recognized partial revenue for its Evanston IL retail store, because of its agreement divest the license to the third-party. MedMen said its pre-announced revenue number for this quarter of $37 million included a full quarter of the Evanston revenue.

The company also managed to dramatically cut expenses from last year’s $71 million to just $24.9 million. The company said it cut expenses by 21% sequentially. Still, MedMen said it only had $10 million in cash as of September 2020 and it is working on new financing.

Money Moves

MedMen has been committed to making big changes as the company works to survive following a year of negative headlines resulting in the departure of former co-founder Adam Bierman. MedMen said it has deferred approximately $32 million in cash commitments during fiscal 2021 as a result of agreements with some of its lenders. During the first quarter, the company said it closed on $5.0 million in additional gross proceeds under its senior secured convertible debt facility led by funds affiliated with Gotham Green Partners. It also closed on $3.0 million in additional gross proceeds under its senior secured term loan with funds managed by Stable Road Capital and its affiliates. MedMen entered into a $10.0 million unsecured convertible debenture facility with certain institutional investors and agreed to sell its Evanston retail store for $20.0 million and received $10.0 million of the total consideration.

Expansion Plans

Tim Bossidy, the Chief Operating Officer reviewed the company’s recreational stores on the earnings call as well saying, “We plan to enhance our footprint further with two new stores in San Francisco, a new store in Emeryville, and a new store in Pasadena. We’ve also nearly completed our LAX store expansion, already our highest growth and most profitable store in the state. Moving over to Nevada, we saw a 192% increase in revenue this past quarter, if tourism began to return without the impact of state-mandated closures due to COVID-19. With the tightness in the Nevada wholesale market, we also expect that the various cultivation partnerships we are working on will show up an improved revenue and margin in the coming quarters.”

He added, “In Illinois, our Oak Park location continues to perform extremely well. This location is the best performing store and the national portfolio in terms of revenue. During the quarter, we made the tough decision to sell our Evanston location. While we were excited about the prospects of the online market, given capital needs for the turnaround plan, the ability to bring in $20 million of cash proceeds in short order is highly attractive to us. We still expect to expand in that market as we evaluate the additional location associated with our Oak Park license. Our final recreational market is in Massachusetts. We’ve made significant progress here on the licensing front. We recently announced that the Massachusetts Cannabis Control Commission voted in favor of granting us provisional adult-use license in both our Fenway Park and Newton locations.”

Management Changes

MedMen named Tracy McCourt to the new role of Chief Revenue Officer. The company appointed Al Harrington to its Board of Directors. Mr. Harrington is the founder of Viola, Inc., a premium cannabis company, and the founder of Harrington Wellness, a manufacturing company of non-psychoactive cannabinoid products.

Kaitlin DomangueKaitlin DomangueJune 18, 2020


MedMen co-founders, Adam Bierman and Andrew Modlin have stepped down from the company’s Board of Directors, announced yesterday. This comes after a long series of errors and Bierman eventually stepping down as CEO in February.  

MedMen has made headlines in the cannabis news for the past 8-ish months, and while some issues (like the riots and sales being impacted due to COVID), were things totally out of their control, the general consensus is that the company, especially the corporate offices, have made some serious missteps along the way. MedMen has been heavily criticized in the past for its extreme spending habits and the bottomless need for more capital. Bierman and Modlin have been personally accused of handling money disproportionately to benefit themselves. 

Here is a timeline of some of the missteps and out-of-their-control misfortunes in MedMen’s last eight months, that ultimately led to the co-founders to step down from the Board of Directors:

November 2019: MedMen reports a net loss of $82 million for the first fiscal quarter of 2020 

Per Green Market Report’s article, “MedMen Enterprises Inc. (CSE: MMEN) (OTCQX: MMNFF) reported first fiscal quarter revenue of $44 million, up 105% year-over-year and 5% sequentially. The company also reported an eye-popping net loss of $82 million. MedMen delivered an Adjusted EBITDA loss of $22.2 million for the quarter.

Approximately $7.4 million of rent expense was not included in Adjusted EBITDA for the quarter due to the application of IFRS 16 Leases. Adjusted EBITDA loss under the previous methodology would have been $29.6 million compared to a $39.4 million loss in the previous quarter.”

“We entered Fiscal 2020 on a mission to build a more nimble and financially flexible MedMen,” said Adam Bierman, MedMen co-founder and chief executive officer. “As we right-size our organization and implement an intensified focus on free cash flow generation, our business will become more efficient, in turn allowing us to better serve our stakeholders. Through the successful execution of these goals, we expect MedMen will be EBITDA positive by the end of calendar year 2020.”

November 2019: MedMen Cuts Workforce To Cut Costs

Bloomberg reported on November 15th that MedMen cut 190 jobs, including 20% of their corporate workforce. It also announced the sale of its stake in Treehouse Real Estate Investment Trust for $14 million. 

December 2019: MedMen Sells Licenses to Raise Money

According to Green Market Report, “the company has executed a non-binding term sheet for the sale of its Arizona licenses, which include three vertically-integrated licenses, and a binding term sheet for the sale of a cultivation and manufacturing license in Illinois.

MedMen said it expects to get roughly $54 million in cash proceeds through the divestiture of the non-core licenses. The completion of the sale of Arizona licenses is subject to due diligence, the execution of definitive documentation and customary regulatory approvals. The completion of the sale of the Illinois license is subject to the execution of definitive documentation and customary regulatory approvals.

The company said it will continue to explore the sale of other non-core assets and will focus on deepening its retail market share in California, Nevada, Florida, Illinois, Massachusetts, and New York.” MedMen also sold some Class B subordinate shares for $20 million.

January 2020: MedMen Confirms the Rumor They Haven’t Been Paying Vendors

Former MedMen CEO, Adam Bierman, told Green Market Report, “During that time frame [in reference to a time of growing pains for the company], we stopped payments to certain vendors as would be commonplace in the restructuring of a retailer. We turned over our accounts payable to a restructuring consulting firm (FTI Consulting) so that we could preserve and allocate the cash as we got through and out the other end of restructuring. These are brands that heavily rely upon MedMen for their business. Especially in California, we understand how important MedMen is to that ecosystem and we understand what happens, and the impact, and the ripple effect it has on these manufacturers. They’re having discussions like that with our teams about structuring payments.” The news was broken by screenshots of emails being posted online telling vendors MedMen would not be paying them. 

February 2020: MedMen CEO, Adam Bierman, Steps Down

MedMen announced on January 31st that their CEO was stepping down effective February 1st. He also gave up all of his Class A super voting shares as part of the deal. 

“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.

May 2020: MedMen Says COVID-19 Impacted Sales

After releasing a fairly solid third quarter earnings report, on the company’s earnings conference call, interim CEO Tom Lynch said, “Unfortunately, COVID has impacted our sales since the end of March; we’re down in April overall, but have seen a steady increase since. While we’re still not back to our normal levels, pre-COVID, particularly in California, we’re optimistic about our ability to recapture traffic as soon as stay at home orders are lifted.”

MedMen also noted that its Nevada location had suffered saying, “We saw a decrease in overall sales in this market, particularly given the impact that the pandemic has had on tourism into Las Vegas, we’re encouraged about the recent decision to open up cannabis retail again, and have already begun to see a steady ramp-up in revenue.”

June 2020: MedMen Storefronts Looted, Robbed, and Destroyed

The Green Market Report wrote, “according to social media videos, MedMen in Los Angeles had two locations broken into and robbed. The man filming the video can be heard saying, “They are cleaning MedMen out” as protestors or just plain looters leave the store with red shopping bags, filled with the things they stole.”

Hopefully, 2021 brings better tides for the cannabis giant.

Kaitlin DomangueKaitlin DomangueJune 4, 2020


Businesses across the nation are suffering at the hands of protesters attempting to send a message about the brutal killing of George Floyd. Many protests have been peaceful, but there are many that lead to looting and damaging buildings, and cannabis dispensaries are included. Despite being considered an essential business throughout the pandemic, many cannabis retail stores found themselves in the crosshairs of these looters. 

The protestors describe these acts of violence and damage to their cities as years of pent up rage and unheard voices, stemming from what they believe is a racially biased system against black Americans. The civil unrest has incited the President to release the National Guard across various states. There have been many deaths, arrests, and injuries during this tense time in history. 

According to social media videos, MedMen in Los Angeles had two locations broken into and robbed. The man filming the video can be heard saying, “They are cleaning MedMen out” as protestors o just plain looters leave the store with red shopping bags, filled with the things they stole. 

MedMen did not want to comment on the situation. However one employee of MedMen posted on LinkedIn, “It is not hard for me to empathize with, and I am sensitive to those who view MedMen as a symbol of the inequality that led to the anger expressed last night.” He further emphasized his support for those who feel outraged by the killing of George Floyd, and he himself feels “angry that a group of police officers sat idly by while one of their own murdered George Floyd by standing on his neck for nearly 10 minutes.” MedMen reported Monday that all of their stores will be closed until further notice. They have operations across six US states. 

“Effective immediately, we are temporarily closing all stores and the corporate office to protect the safety of our employees. The safety of everyone in the MedMen family is the most important thing right now, and we are grateful to report that while our stores were damaged, our employees and security guards were unharmed.” The company said in an internal memo, first reported by Marijuana Moment

Jushi Closes Temporarily

Jushi Holdings (OTC:JUSHF) Chairman and Chief Executive Officer Jim Cacioppo said in a statement:

We fully support an individual’s right to freedom of speech and the touching peaceful demonstrations that we have seen around the country. We are heartbroken by the murder of George Floyd and the pain it is causing communities across the country that we not only work in, but live and love.

Unfortunately, certain opportunistic bad actors have at times manifested unacceptable behaviors. This past weekend, our Center City and Northern Liberties locations in Philadelphia were broken into, making it impossible for us to safely operate. In addition to these two temporary store closures, we have limited our hours at certain locations in Pennsylvania and Illinois. Please check for the latest details. It is our hope to begin safely servicing our customers soon from the impacted store locations and apologize for any inconvenience this may cause our patients and customers.

As committed members of the cannabis movement, we will also continue to fight for equality and work to overturn racially biased laws that ruin lives and unequally target disenfranchised communities and people of color. 

Rappers Berner and B Real both reported robberies at their stores, too. B Real Tweeted on May 30th, “Today as a country we hit a low point.  Rioting, looting  and burning down business all during a pandemic isn’t going to make the change needed. It will only set us back. Protest peacefully and remove the instigators that aren’t there in the name of George Floyd.” 

The Chicago Tribune reported that all of their dispensaries would be closed indefinitely either to prevent looting or to clean up from the damage that has already been done. Kris Krane, president and co-founder of 4Front Ventures, who owns the robbed dispensary Mission South Shore, told The Chicago Tribune, “The store’s been pretty much ransacked. Nothing was going to hold that many people back.” Krane watched 30 to 40 people break into the dispensary on security cameras. 

Most of the cannabis industry seems optimistic that they will rebuild from this, and a lot of them say they understand why this happened. “We can replace windows, we can grow more pot, we can have empathy.” said the MedMen employee. 

Kaitlin DomangueKaitlin DomangueMay 28, 2020


It’s time for your daily hit of cannabis financial news for May 28th, 2020. 

On the Site

Canopy River Tightens Belt, Cuts Employees

Canopy Rivers Inc. (OTC: CNPOF) is laying off employees and cutting back on spending as the company focuses on positive cash flow. The venture capital firm that specializes in cannabis companies said that it is streamlining its operations to preserve its cash on hand.

The company said in a statement that it is making the following changes:

  • A material reduction in the Company’s operating cash outflows, including a reduction in headcount, directors’ compensation, marketing expenses, and general corporate expenses of a minimum of 35% from the Company’s fiscal 2020 operating cash outflows on a normalized basis;
  • A focus on generating positive cash flow from operations for fiscal 2021 (year ended March 31, 2021); and
  • A focus on maximizing returns on existing assets.

MedMen Says COVID Has Hurt Sales

On the company’s earnings conference call, interim CEO Tom Lynch said, “Unfortunately, COVID has impacted our sales since the end of March; we’re down in April overall, but have seen a steady increase since. While we’re still not back to our normal levels, pre-COVID, particularly in California, we’re optimistic about our ability to recapture traffic as soon as stay at home orders are lifted.”

MedMen also noted that its Nevada location had suffered saying, “We saw a decrease in overall sales in this market, particularly given the impact that the pandemic has had on tourism into Las Vegas, we’re encouraged about the recent decision to open up cannabis retail again, and have already begun to see a steady ramp-up in revenue.”

In Other News

Aurora Completes Acquisition of Reliva, LLC

Canadian cannabis company, Aurora, has completed the acquisition of hemp-derived CBD company, Reliva. 

“We are pleased to have closed the Reliva transaction ahead of schedule. The partnership between Aurora and Reliva is expected to create a market leading international cannabinoid platform that we believe can deliver robust revenue and profitable growth,” said Michael Singer, Executive Chairman and Interim CEO of Aurora. “I would like to officially welcome Miguel Martin and his team to Aurora, and look forward to increasing Aurora’s operating scale, international reach, and product and brand diversity while in parallel, we remain focused on delivering Adjusted EBITDA profitability in Canada for the benefit of all shareholders.”

Cresco Labs Announces First Quarter 2020 Results

Multi-state operator Cresco announced a record revenue of $66.4 million in Q1 of 2020. This is a 60% growth over 2019’s Q4. The company also revealed the largest cultivation expansion in their company’s history, adding 6x cultivation space in Illinois and 4x the cultivation space in Pennsylvania. There was a 144% increase year over year from Q1 of 2019 to Q1 of 2020. 

Debra BorchardtDebra BorchardtMay 28, 2020


MedMen Enterprises Inc. (OTCQX: MMNFF) reported a fairly solid third-quarter 2020 but warned that COVID-19 has affected its sales.

On the company’s earnings conference call, interim CEO Tom Lynch said, “Unfortunately, COVID has impacted our sales since the end of March; we’re down in April overall, but have seen a steady increase since. While we’re still not back to our normal levels, pre-COVID, particularly in California, we’re optimistic about our ability to recapture traffic as soon as stay at home orders are lifted.”

MedMen also noted that its Nevada location had suffered saying, “We saw a decrease in overall sales in this market, particularly given the impact that the pandemic has had on tourism into Las Vegas, we’re encouraged about the recent decision to open up cannabis retail again, and have already begun to see a steady ramp-up in revenue.”

Third Quarter Results

MedMen reported that its third-quarter revenue of $45.9 million was up 41% over 2019 and up 4% sequentially. 64% of the company’s retail business is in California. CFO Zeeshan Hyder said on the call,Since the end of March, we did see a slowdown in sales into our California stores due to the shelter at home orders and reduced tourism. Accordingly, we modified certain store operations and reduced staff. However, over the past few weeks, we’ve seen a steady rebound of sales, with overall sales per week up over 20% versus the end of April.”

The net loss and comprehensive loss was $76.9 million for the quarter versus $96.4 million in the previous quarter. The net loss from continuing operations was $68.8 million versus $75.2 million in the previous quarter. Third-quarter 2020 net loss attributable to shareholders of MedMen enterprises was $39.9 million or $0.10 per basic and diluted share. Overall, adjusted EBITDA loss for the quarter was $20.7 million compared to $35.1 million in the previous quarter.

On a positive note, Hyder said, “We had a first full month in March of our retail stores being cash flow positive on an after-tax basis. While we expected to be here sooner, we now have a playbook for how to continue building off the progress being made to increase gross margins and reduce store-level expenses.”

Gross Margins Fall

The company reported that its retail gross margins for the third quarter were 47% versus 51% for the second quarter. “The decrease was related to a one-time inventory adjustment we took during the quarter. Without the adjustment, overall gross margins for the quarter was 51%, and if you look at the month of March alone, our gross margin was over 53%, reflecting the impact of our new vendor agreements.” Cowen & Co analyst Vivien Azer asked on the call, “Despite all your costs, cost savings, your OpEx is still running three times ahead of gross profit and now you’re not going to be vertically integrated, which means it seems like you’re probably getting up to margin there though you’re saving yourself some of the overhang on DNA.” Lynch said the company will become incredibly efficient in order to protect the margins.

Financial State

MedMen ended the third quarter of 2020 with $31.8 million of cash and cash equivalents. During the quarter, the company closed an equity financing transaction of $20 million of which $8 million was funded during the quarter, the remainder was funded in the second quarter. It also closed on $12.5 million of additional gross proceeds under Tranche 4 of its Gotham Green convertible notes facility.

Expansion Plans & Closings

MedMen said it temporarily closed five stores in Florida to redirect the limited product to the higher traffic locations but said it fully intends to open those backup. The company also said that it expects to open stores in San Francisco, Emeryville, Pasadena, Fenway area of Boston, Chicago, and Miami, all in the next 12 months; stores that could be at the top of the list in terms of performance in their opinion.


Debra BorchardtDebra BorchardtFebruary 26, 2020


MedMen Enterprises Inc.  (CSE: MMEN) (OTCQX: MMNFF) delivered its financial results for the second quarter of 2020 ending December 28, 2019. Revenue across MedMen’s operations in California, Nevada, New York, Illinois, and Florida increased to $44.1 million for the quarter, up 50% year-over-year and 11% sequentially. The company stated that the revenue figures did not include the Company’s operations in Arizona, which are in the process of being divested and are classified as discontinued operations in the Company’s financials.

The net loss for the quarter was a staggering $96 million versus last year’s $64 million. The loss per share was ($0.09) versus last year’s ($0.23), so some improvement there.

“We feel positive about the progress made while remaining aware there is still substantial work to be done. The business is focused on the execution of a strategy to streamline operations, strengthen its balance sheet and bring in additional capital. The sustained power of the brand and consistent consumer loyalty is a regular reminder of our strengths and the opportunities within reach,” said Ben Rose, executive chairman of the Board and Chief Investment Officer of Wicklow Capital.

The total expenses for the quarter were $69 million, which the company managed to trim from last year’s $76 million for the same time period. The company reported an Adjusted EBITDA loss of $35.1 million for the quarter. The Adjusted EBITDA for the quarter does not include additional headcount reduction and retail optimization efforts the company executed on subsequent to the quarter-end. The company’s cultivation and manufacturing facilities contributed to $11.4 million of the total EBITDA loss.

“This is a pivotal time for the Company where we have the opportunity to re-assess the business and narrow the focus on what we do best – retail, to continue to cut costs and to execute on four-wall economics with a path to profitability,” said Ryan Lissack, Interim Chief Executive Officer. “I look forward to transitioning the company into its next chapter, which will be defined by financial discipline and strategic growth to drive long-term value creation for the Company and its stakeholders.”

Yesterday, MedMen entered into an agreement to assign its rights to acquire a licensed cultivation and manufacturing facility in Hillcrest, Illinois for  $17 million which it received as part of its merger termination agreement with PharmaCann, LLC. As part of the Hillcrest Transaction, MedMen received an initial payment of $10 million and the second payment of $7 million is due prior to the closing of the Hillcrest Transaction, expected in the coming weeks.

The company announced two new independent board members and voted to keep former CEO and Co-founder Adam Bierman on the board.

Mr. Mel Elias, an active investor, entrepreneur, and developer in Los Angeles has past and present board experience in CPG and consumer retail businesses both in the US and internationally. He was President and CEO of The Coffee Bean & Tea Leaf for 6 years until it was sold in 2013.

Mr. Cameron Smith currently operates a private angel investment and advisory fund that focuses on health food. Prior to his investment and advisory business, Mr. Smith was General Counsel of The Island ENC, Inc., President of Quantlab Financial and worked at the SEC.

Debra BorchardtDebra 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.


Kaitlin DomangueKaitlin DomangueJanuary 28, 2020


Emerald Health Therapeutics (TSXV: EMH; OTCQX: EMHTF), referred to as “Emerald” for clarity, is a Canadian cannabis company offering wellness-oriented and recreational cannabis products. Emerald provided an update yesterday on their recently announced a shares for debt transaction with Emerald Health Sciences, (“Sciences”) a control person for Emerald. 

Presently, Emerald carries an aggregate debt of $2,816,963. Per a previously disclosed loan agreement between both parties, Emerald will settle $794,182 owed to Sciences, as well as $2,022,781 owed to Sciences pursuant to trades payable. Emerald Health Therapeutics will also issue 9,713,666 common shares of Emerald to Sciences at $0.29 per share in order to fulfill the debt.

Currently, Sciences holds roughly 29,687,942 of Emerald’s issued shares and upon the completion of the debt settlement, Sciences will hold approximately 23.1% of the issued and outstanding shares of Emerald, on an undiluted basis.

Due to Sciences being a control person of Emerald, the settlement is considered to be a “related party transaction”, meaning the companies had a pre-existing connection prior to the transaction.

Emerald is not the only company in a cash crunch, and relying on selling common shares to stay above water. MedMen has also been making the headlines for a similar situation. The company recently sent out emails to their vendors stating they cannot pay them, and are offering shares in their company instead.

Green Market Report talked to Adam Bierman, the CEO of MedMen, about their circumstances. Bierman tells us, “We’ve been very forthright with the public, and with our investment community at large about the fact that at the end of last year we entered into a restructuring in the business, exiting the hyper-growth stage of the business, and getting into sustainability, and with that, there’s a lot of pain. And that pain starts at the employees that were on this mission with us, building this platform with us that we had to part ways with.”

About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


Recent Tweets

@GreenMarketRpt – 10 hours

Did you miss any industry news this week? Then check out March 5, 2021 Our new weekly vi…

@GreenMarketRpt – 1 day

$CWBHF declining revenue, CBD competition, strain patent lawsuit makes the deal unde…

Back to Top

You have Successfully Subscribed!