Embattled Canadian cannabis producer Hexo is reforming its board of directors after signing an agreement with an activist shareholder displeased with the company’s performance.
The move comes after Hexo investor Adam Arviv publicly called for the ouster of most of the board earlier this month, citing the company’s underperformance.
Arviv’s investment fund, Kaos Capital, owns roughly 3% of Hexo shares, according to a Hexo news release Tuesday.
Hexo’s board chair, John Bell, is stepping down, as are directors Emilio Imbriglio, Adam Miron and Scott Cooper.
New directors Mark Attanasio, Rob Godfrey and Hélène F. Fortin will stand for election at a March shareholders meeting.
An eighth board director will be appointed after that meeting, according to Hexo’s release.
“We’ll work closely with the management team as they continue to fast-track (Hexo’s) path to becoming a cash flow positive business,” Arviv said in a statement.
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Hexo slashed jobs earlier this month to save cash as part of a “path forward” plan targeting positive cash flow.
The company is seeking a share consolidation to maintain its listing on the Nasdaq exchange, where its shares have fallen below the minimum bid price.