UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
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| Item 1.02 | Termination of a Material Definitive Agreement |
On November 21, 2021, MedMen Enterprises Inc. (the “Company”) provided notice to SierraConstellation Partners LLC (“SierraConstellation”) of its termination of the Transaction and Retention Bonus Award Agreement dated July 12, 2021 with SierraConstellation (the “Transaction Agreement”), which was originally entered into in connection with the appointment by the Board of Directors of the Company (the “Board”) of Tom Lynch as permanent Chief Executive Officer. As a result of the termination of the Transaction Agreement, the Board also terminated Mr. Lynch as Chief Executive Officer of the Company. The Management Support Agreement dated March 30, 2020, and amended on May 1, 2020, pursuant to which SierraConstellation provides interim management and restructuring support, continues to remain effective.
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
On November 21, 2021, in connection with the termination of the Transaction Agreement, the Board terminated Tom Lynch as Chief Executive Officer. On November 21, 2021, Tom Lynch also resigned as a director and Chairman of the Board of the Company, effective immediately. Mr. Lynch’s decision to resign was not the result of any dispute or disagreements with the Company on any matter relating to the Company's operation, policies (including accounting or financial policies) or practices. In connection with his termination, on November 21, 2021, the Company and Mr. Lynch entered into a Mutual Release and Separation Agreement (the “Separation Agreement”). Pursuant to the Separation Agreement, the Company agreed that 124,868 stock options with an exercise price of C$0.22 per share and 214,030 sock options with an exercise price of C$0.355 per share will continue to remain exercisable for a period of six months from the date of the Separation Agreement. Furthermore, 477,531 unvested Restricted Stock Units (“RSUs”) vested immediately and the remaining 1,432,591 RSUs were immediately terminated and forfeited.
On November 21, 2021, the Board of Directors of the Company appointed Michael Serruya, a current director, as interim Chief Executive Officer and Chairman of the Board. Michael Serruya, 57, has served as a director of the Company since August 2021 and was appointed pursuant to a Board Nomination Rights Agreement dated August 17, 2021 between the Company and S5 Holdings LLC. Mr. Serruya serves as Managing Director of Serruya Private Equity Inc. Previously, Mr. Serruya co-founded Yogen Früz Worldwide Inc., a global chain currently consisting of more than 1,400 locations, and co-founded CoolBrands International Inc. where from 1994 to 2000 he served as Chairman and Chief Executive Officer. CoolBrands was a leading consumer packaged goods company focused on frozen desserts, which included such brands as Weight Watchers, Eskimo Pie, Tropicana and Godiva Ice Cream. From 2013 to 2016, Mr. Serruya was Chairman and Chief Executive Officer of Kahala Brands, a multinational franchisor with over 1,400 stores globally. Kahala Brands owned Cold Stone Creamery, Taco Time and Blimpie Subs. From 2018 to 2021, Mr. Serruya was Chairman of Global Franchise Group, a multinational franchisor with over 800 stores globally. Global Franchise Group owned Round Table Pizza, Marble Slab Creamery, Hot Dog on a Stick, Pretzelmaker and MaggieMoo’s Ice Cream and Treatery.
Except for the Board Nomination Rights Agreement described above and the transactions related to the Company’s Senior Secured Convertible Credit Facility and the $100 Million equity investment that occurred in August 2021, described under “Certain Relationships and Related Transactions, and Director Independence” in the Company’s Annual Report on Form 10-K for the fiscal year ended June 26, 2021, filed with the Securities and Exchange Commission (the “SEC”) on September 24, 2021, there are no arrangements or understandings between Mr. Serruya and any other person pursuant to which he was appointed to serve as a director of the Company and Mr. Serruya does not have a direct or indirect material interest in any “related party” transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K. Furthermore, as of October 25, 2021, Mr. Serruya indirectly beneficially owns approximately 44.9% of the Company’s Class B Subordinate Voting Shares through his ownership of S5 Holdings LLC as well as partial ownership of the general partner of Superhero Acquisition L.P., which is further described under “Security Ownership of Certain Beneficial Owners and Management” in the Company’s prospectus dated November 8, 2021 filed with the SEC on November 9, 2021 included as part of the registration statement on Form S-1 (File No. 333-253980 and 333-256912). There are no family relationships between Mr. Serruya and any director or executive officer of the Company.
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| Item 7.01 | Regulation FD Disclosure. |
On November 22, 2021, the Company issued a press release, which is attached to this Current Report on Form 8-K as Exhibit 99.1 and hereby furnished pursuant to this Item 7.01.
The information disclosed under this Item 7.01, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits |
| Exhibit Number |
Description | |
| 99.1 | Press Release dated November 22, 2021. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated: November 26, 2021 | MEDMEN ENTERPRISES INC |
| /s/ Reece Fulgham | |
| By: Reece Fulgham | |
| Its: Chief Financial Officer |
| 3 |
Exhibit 99.1
MedMen Announces Michael Serruya as Chairman and Interim CEO
LOS ANGELES--(BUSINESS WIRE)-- MedMen Enterprises Inc. (“MedMen” or the “Company”) (CSE: MMEN) (OTCQX: MMNFF), a premier cannabis retailer with operations across the United States, today announced its Board of Directors has appointed Michael Serruya as Chairman and Interim CEO, effective immediately. Serruya succeeds outgoing Chairman and CEO Tom Lynch, who held the position since 2020 and oversaw the Company’s operational turnaround.
Serruya joined MedMen’s board in August 2021 as part of a $100 million investment in the Company by Serruya Private Equity to expand its operations in key markets and identify and accelerate further growth opportunities across the United States. This, together with Tilray, Inc.’s acquisition of the majority of the outstanding senior secured convertible notes of MedMen that were originally held by certain funds affiliated with Gotham Green Partners, LLC, provides MedMen with the flexibility to execute on its growth priorities and explore additional strategic opportunities.
Serruya is a seasoned cannabis investor with extensive retail expertise, having previously served as CEO of Coolbrands® (then home to CPG brands including Weight Watchers®, Eskimo Pie®, Tropicana® and Godiva® Ice Cream) and Kahala Brands® (home to global QSR brands including Cold Stone Creamery®, Taco Time® and Blimpie Subs®).
“We want to thank Tom for his leadership over the past 20 months as he’s led a successful and disciplined turnaround plan, which has left us well positioned for accelerated growth as MedMen 2.0,” said Serruya. “Our focus now is taking this Company to the next level as we seek to leverage the strength of the MedMen brand and consumer experience in order to expand it across the United States, Canada and internationally.”
Lynch said, “It has been an honor to lead MedMen through its transformation into MedMen 2.0, which is now in growth mode. I am confident Michael and the Board will identify the right CEO to execute against our aggressive growth plans and achieve company-wide profitability in 2022.”
Lynch will continue to serve as the Manager of MedMen Boston LLC and MME Newton Retail LLC, and for the immediate future will continue to participate in the direction and control of those businesses.
ABOUT MEDMEN:
MedMen is a premier American cannabis retailer with an operational footprint in California, Nevada, Illinois, Arizona, Massachusetts, and Florida. MedMen offers a robust selection of high-quality products, including MedMen-owned brands MedMen Red and LuxLyte through its premium retail stores, proprietary delivery service, as well as curbside and in-store pickup. MedMen Buds, an industry-first loyalty program, provides exclusive access to promotions, product drops and content. MedMen believes that a world where cannabis is legal and regulated is safer, healthier, and happier. Learn more about MedMen at www.medmen.com.
Cautionary Note Regarding Forward-Looking Information and Statements:
This press release contains certain “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only MedMen’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of MedMen’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “well positioned”, “am confidant”, “will select” and “will achieve”, and including statements suggesting the Company will be profitable in 2022. This forward-looking information is based on certain assumptions made by management and other factors used by management in developing such information. A variety of factors, including known and unknown risks, many of which are beyond the Company’s control, could cause actual results to differ materially from the forward-looking information and statements in this press release including, without limitation: ability to effectively deal with the restrictions, limitations and health issues presented by the COVID-19 pandemic; management’s perceptions of historical trends, current conditions and expected future developments; the ability to effectively manage growth, including anticipated and unanticipated costs; achieving the anticipated results of the Company’s strategic plans; and other risk factors discussed in MedMen’s Annual Report on Form 10-K for the fiscal year ended June 26, 2021 and other disclosure filings, all available under MedMen’s profile on www.sedar.com and at www.sec.gov.
The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and MedMen does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws.
Forward-looking statements contained in this news release are expressly qualified by this cautionary note.
MedMen Media Contact:
Lisa Weser, MedMen@Trailblaze.co
MedMen Investor Relations Contact:
Investors@MedMen.com
Cover |
Nov. 21, 2021 |
|---|---|
| Cover [Abstract] | |
| Document Type | 8-K |
| Amendment Flag | false |
| Document Period End Date | Nov. 21, 2021 |
| Entity File Number | 000-56199 |
| Entity Registrant Name | MEDMEN ENTERPRISES INC |
| Entity Central Index Key | 0001776932 |
| Entity Tax Identification Number | 98-1431779 |
| Entity Incorporation, State or Country Code | A1 |
| Entity Address, Address Line One | 10115 Jefferson Boulevard |
| Entity Address, City or Town | Culver City |
| Entity Address, State or Province | CA |
| Entity Address, Postal Zip Code | 90232 |
| City Area Code | 424 |
| Local Phone Number | 330-2082 |
| Written Communications | false |
| Soliciting Material | false |
| Pre-commencement Tender Offer | false |
| Pre-commencement Issuer Tender Offer | false |
| Entity Emerging Growth Company | true |
| Elected Not To Use the Extended Transition Period | false |
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