Green Thumb Industries’ CEO, Ben Kovler, saw a hefty cut in his voting power within the company due to a recent divorce settlement, according to a disclosure made by the executive.
The Chicago-based cannabis company (CSE: GTII) detailed that as part of the marital agreement, Kovler handed over a sizable chunk of his super voting shares. The transfer led to a reduction of 35,000 super voting shares, or roughly a 19% drop for Kovler.
Based on a C$15 trading price on Sept. 26, the shares handed over in the settlement are valued at an estimated C$52.5 million.
In response to the development, the company sought to reassure stakeholders regarding the stability of company shareholding beyond this particular settlement.
“Neither Mr. Kovler nor, to Mr. Kovler’s knowledge, any other member of the Issuer’s management team, anticipates selling any additional shares of the Issuer in connection with these transactions,” it noted in the public filing.
To facilitate the settlement, Kovler first converted 15,000 of his super voting shares into multiple voting shares. Those were subsequently converted into 1.5 million subordinate voting shares. In total, the CEO relinquished these 1.5 million shares along with an added 20,000 super voting shares to fulfill the settlement’s terms.
Before the transfer, records showed Kovler holding 183,254 super voting shares, amounting to a dominant 72.81% of the available super voting shares. Post-settlement, his holdings shrank to 148,254, a stake representing 62.6% of the class.
For clarity on Green Thumb’s share classifications: Super voting shares represent a significant 1,000 votes each and are convertible into one multiple voting share. Each of these multiple voting shares has 100 votes and can be further transformed into 100 subordinate voting shares.
The company did not respond to requests for comment.
High-profile divorce settlements involving huge share transfers are not unprecedented in the business world. For instance, the much-publicized divorce of Amazon founder Jeff Bezos saw his ex-wife, MacKenzie Scott, receive 25% of the couple’s Amazon stock, a stake valued at around $36 billion at the time.
However, every situation is unique, with varying implications for the companies and individuals involved.
Read More Feedzy