Planet Organic loses majority of board

EDMONTON -- Four directors, including a company co-founder, have resigned from the board of debt-ridden Planet Organic Health Corp., the company said Tuesday.

Executive vice-president Darren Krissie announced co-founder Mark Craft, Michael Arougheti, Daniel Katz and David Heighington have resigned.

Their departure leaves Mr. Krissie, Ian Newton and Brent Knudsen as the current board of directors.

In a statement, Mr. Krissie thanked the four for their service but gave no reason for their resignations.

It follows a shakeup in November when Planet Organic Market division president Mr. Craft and vice-president of marketing for the division and co-founder Diane Shaskin were released. Mr. Craft remained on the board.

Mr. Craft and Ms. Shaskin together opened the Terra Foods natural store in 1993, which later became Planet Organic in the early 2000s. The company expanded with a growing demand for organic foods.

The Edmonton-based organic and natural products retailer faces a debt reportedly worth $39.3-million.

“Shareholders are reminded that the corporation is currently operating in default under its credit facilities, and accordingly the lenders have the legal right to demand repayment of all indebtedness and enforce their security over all of the corporation’s assets,” the company said in a release.

“To date the Corporation has not been successful in arranging financing from other sources to meet its debt obligations to the lenders.”

Planet Organic is reviewing financing options to reduce its debt, it said.

The company, which lost $2.2-million its second quarter ending Dec. 31, is selling off its underperforming Sangsters Health Outlet division, and closed a Toronto-area store during the quarter to reduce debt.

Planet Organic operates nine natural food supermarkets in Canada under the Planet Organic Market banner and 11 natural food stores called Mrs. Green’s Natural Markets. It also operates Trophic Canada, a maker of natural supplements.

Edmonton Journal

bmah@thejournal.canwest.com