4Front Ventures Updates Governance, Financial Timelines, and RSU Issuance for Directors

4Front Ventures Corp. Governance and Financial Update

4Front Ventures Corp., a prominent multi-state cannabis operator, has recently taken significant steps to enhance its governance structure and deliver crucial financial updates. In a move aimed at fostering better independence and oversight within the company's Board of Directors, three directors have stepped down, marking a pivotal moment in 4Front's ongoing evolution.

Changes to the Board of Directors

Effective March 29, 2025, Chetan Gulati, Roman Tkachenko, and Leo Gontmakher have resigned from their positions on the Board. These individuals were associated with 4Front’s senior lenders, including Navy Capital and LI Lending. The resignations are intended to remove any potential conflicts of interest that may have arisen due to their ties with these financial backers. The remaining board members, Kris Krane and David Daily, will ensure continuity during this transition, bringing with them their wealth of experience in guiding the company toward its strategic priorities.

This restructuring aligns with 4Front’s commitment to improving governance standards, underscoring the company’s dedication to transparency and independent decision-making. These changes are crucial as 4Front continues to navigate the fast-evolving landscape of the cannabis industry.

Financial Reporting Delays

In conjunction with the governance changes, 4Front also provided updates regarding its financial reporting. The company did not submit its audited financial statements for the fiscal year ending December 31, 2024, nor its Annual Report on Form 10-K by the March 31, 2025, deadline. This delay is primarily attributed to ongoing financing and restructuring efforts, which temporarily impacted the auditing process.

Despite the challenges, 4Front remains optimistic and is working diligently to complete the necessary audits and filing requirements. Although the company does not expect to meet the 15-day extension period permitted by Rule 12b-25, it anticipates that the filings will be finalized within sixty days, once the audit engagement resumes.

Issuance of Restricted Stock Units

In a strategic move to compensate board members, 4Front has announced the issuance of a total of 6,573,486 Restricted Stock Units (RSUs) at a deemed issue price of C$0.05 per share to four of its directors. This compensation strategy replaces cash payments for board services and is reflective of the company’s innovative approach to aligning director compensation with performance. The RSUs cover the period from May 2024 to February 2025, marking a proactive step by the company to motivate and retain key leaders during a transformative period.

It is essential to note that the RSUs are distinct from the directors' resignation decisions, indicating that this compensation strategy is entirely separate from the governance changes made. The vesting of these RSUs is contingent upon the occurrence of specific events as outlined in the related agreements.

About 4Front Ventures Corp.

Founded in 2011, 4Front Ventures Corp. has established itself as a national, vertically integrated cannabis operator, focusing on both cultivation and retail. With operations in key markets such as Illinois, Massachusetts, and facilities in Washington, the company has earned a reputation for its low-cost production methods and high-quality standards. To date, 4Front has launched more than 20 cannabis brands and over 1,800 unique products through its retail outlets, which are completely owned and operated.

As 4Front continues to strategize for long-term growth, its team is committed to leveraging their extensive industry experience to navigate the complexities of the cannabis market effectively. With these recent governance and financial updates, as well as innovative compensation strategies, 4Front Ventures is positioning itself for continued success in the dynamic cannabis sector.