[10-Q] Vireo Growth Inc. Quarterly Earnings Report

Rhea-AI Filing Summary

Vireo Growth Inc. reported sharply larger operations following three acquisitions completed in 2025. Q3 revenue rose to $91.7 million from $25.2 million a year ago, driven by retail sales of $76.0 million and wholesale of $15.7 million. For the first nine months, revenue reached $164.3 million versus $74.4 million last year.

Despite higher sales, the company posted a Q3 net loss of $26.3 million and a nine‑month net loss of $47.7 million. Results included $12.4 million of non‑cash product cost from inventory step‑up and a $8.6 million loss on debt extinguishment tied to refinancing. Operating expenses also increased with integration, stock‑based compensation, and amortization.

Vireo closed the Wholesome, Proper, and Deep Roots deals using all‑share consideration, lifting intangible assets and goodwill to $97.3 million. To refinance and fund the combined platform, the company entered a $120 million First Lien Term Loan and a $33 million Chicago Atlantic Term Loan, and added interest rate swaps. Cash was $97.2 million plus $20.4 million of restricted cash at quarter‑end. Total assets were $678.9 million, with long‑term debt of $131.7 million and convertible debt of $8.2 million. Certain New York, Nevada, and Massachusetts assets were classified as held for sale.

Insights

Equity analyst – cannabis operators

Scale up via acquisitions, but losses reflect integration and refinancing costs.

Vireo Growth materially increased scale after closing the Wholesome, Proper, and Deep Roots transactions. Q3 revenue reached $91.7M, largely retail-driven, while nine-month revenue totaled $164.3M. The business also recognized inventory step-up amortization of $12.4M in Q3, which reduced gross profit.

Debt was reset with a $120M First Lien Term Loan and a $33M Chicago Atlantic Term Loan effective July 2025, producing an extinguishment loss of $8.6M. The company added interest rate swaps at a fixed 3.70% pay leg to hedge SOFR exposure.

Cash and restricted cash totaled $117.5M at quarter end, supporting integration and operations. Assets in New York, Nevada, and Massachusetts were classified as held for sale; actual timing is not disclosed in the excerpt. Subsequent filings may provide progress on divestitures and earnout/contingent consideration remeasurement.

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Table of Contents

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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☑		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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For the quarterly period ended September 30, 2025

OR

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☐		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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For the transition period from                      to                     

Commission File Number: 000-56225

VIREO GROWTH INC.

(Exact name of registrant as specified in its charter)

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British Columbia, Canada		82-3835655
(State or other jurisdiction of incorporation or organization)	​	(I.R.S. Employer Identification No.)
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207 South 9th Street, Minneapolis, MN	​	55402
(Address of principal executive offices)	​	(Zip Code)

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​	(612) 999-1606	​
​	(Registrant’s telephone number, including area code)	​

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                                     N/A                               

(Former name, former address and former fiscal year, if changed since last report)

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Securities registered pursuant to Section 12(b) of the Act:

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Title of each class		Trading Symbol(s)		Name of each exchange on which registered
None	​	None	​	None

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes  þ    No  ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).   Yes  þ    No   ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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Large accelerated filer	◻		Accelerated filer	◻
Non-accelerated filer	þ	​	Smaller reporting company	þ
​	​	​	Emerging growth company	þ

​

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes  ◻    No  þ

​

As of November 11, 2025, the registrant had the following number of shares of each of its classes of registered securities outstanding: Subordinate Voting Shares –1,038,706,623; Multiple Voting Shares –259,632; and Super Voting Shares – 0.

​

​

​

Table of Contents

VIREO GROWTH INC.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION	3
ITEM 1 – FINANCIAL STATEMENTS	3
Consolidated Balance Sheets – September 30, 2025 (unaudited) and December 31, 2024	3
Consolidated Statements of Net Loss and Comprehensive Loss – Three and Nine Months Ended September 30, 2025 and 2024 (unaudited)	4
Consolidated Statements of Changes in Stockholders’ Equity (Deficiency) - Three and Nine Months Ended September 30, 2025 and 2024 (unaudited)	5
Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2025 and 2024 (unaudited)	6
Notes to Unaudited Consolidated Financial Statements	7
ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	33
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	43
ITEM 4 - CONTROLS AND PROCEDURES	43
PART II – OTHER INFORMATION	43
ITEM 1 - LEGAL PROCEEDINGS	43
ITEM 1A – RISK FACTORS	44
ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	45
ITEM 5 - OTHER INFORMATION	45
ITEM 6 - EXHIBITS	45
SIGNATURES	47

​

​

​

​

2

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

VIREO GROWTH INC.

CONSOLIDATED BALANCE SHEETS

(In U.S. Dollars, unaudited)

​

​	​	​	​	​	​	​
​		September 30,		​	December 31,
​	​	2025		​	2024
Assets		​			​
Current assets:		​			​
Cash	​	$	97,151,669	​	$	91,604,970
Restricted Cash	​	​	20,387,672	​	​	—
Marketable Securities	​	​	1,012,527	​	​	—
Accounts receivable, net of credit losses of $1,027,316 and $244,264, respectively	​		12,180,295	​		4,590,351
Income tax receivable	​	​	14,414,476	​		12,027,472
Inventory	​		53,901,588	​		21,666,364
Prepayments and other current assets	​		5,114,818	​		1,650,977
Warrants held	​		1,333,103	​		2,270,964
Assets held for sale	​		102,468,441	​		96,560,052
Total current assets	​		307,964,589	​		230,371,150
Property and equipment, net	​		121,241,954	​		32,311,762
Operating lease, right-of-use asset	​		37,112,753	​		7,859,434
Intangible assets, net	​		89,651,531	​		7,899,328
Goodwill	​	​	97,289,115	​	​	—
Investments	​	​	6,000,000	​	​	—
Deposits	​		2,129,430	​		421,244
Indemnified Assets	​	​	17,529,137	​	​	—
Total assets	​	$	678,918,509	​	$	278,862,918
Liabilities	​			​
Current liabilities	​			​
Accounts payable and accrued liabilities	​	$	38,543,289	​	$	10,456,036
Convertible debt, current portion	​	​	1,650,000	​	​	—
Long-term debt, current portion	​	​	15,630,000	​	​	900,000
Right of use liability, current	​		4,771,482	​		1,400,015
Uncertain tax liability	​	​	84,818,307	​		33,324,000
Derivative liability	​	​	160,778	​	​	—
Liabilities held for sale	​		89,334,872	​		89,387,203
Total current liabilities	​		234,908,728	​		135,467,254
Right-of-use liability	​		41,772,546	​		16,494,439
Long-term debt, net	​		131,665,305	​		61,438,046
Convertible debt, net	​	​	8,246,109	​	​	9,862,378
Contingent consideration	​	​	14,919,000	​	​	—
Other long-term liabilities	​	​	1,101,299	​	​	37,278
Total liabilities	​	​	432,612,987	​	​	223,299,395
​	​	​	​	​	​	​
Commitments and contingencies (refer to Note 16)	​			​
​	​	​	​	​	​	​
Stockholders’ equity	​			​
Subordinate Voting Shares ($- par value, unlimited shares authorized; 923,898,809 shares issued and outstanding at September 30, 2025 and 337,512,681 at December 31, 2024)	​		—	​		—
Multiple Voting Shares ($- par value, unlimited shares authorized; 259,632 shares issued and outstanding at September 30, 2025 and 285,371 at December 31, 2024)	​		—	​		—
Additional paid in capital	​		525,482,763	​		286,999,084
Accumulated deficit	​		(279,177,241)	​		(231,435,561)
Total stockholders' equity	​	$	246,305,522	​	$	55,563,523
Total liabilities and stockholders' equity	​	$	678,918,509	​	$	278,862,918

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

​

3

Table of Contents

VIREO GROWTH INC.

CONSOLIDATED STATEMENTS OF NET LOSS AND COMPREHENSIVE LOSS

(In U.S. Dollars, except share amounts, unaudited)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three Months Ended September 30,

​

Nine Months Ended September 30,

​

​

2025

2024

​

2025

2024

​

Revenue

​

$

91,655,155

​

$

25,165,343

​

$

164,258,806

​

$

74,360,905

​

Cost of sales

​

​

​

​

​

​

​

​

​

Product costs

​

40,878,030

​

12,448,373

​

76,292,563

​

36,111,865

​

Non-cash product costs

​

​

12,397,641

​

​

—

​

​

16,549,749

​

​

—

​

Inventory valuation adjustments

​

996,485

​

393,000

​

1,203,336

​

130,000

​

Gross profit

​

37,382,999

​

12,323,970

​

70,213,158

​

38,119,040

​

Operating expenses:

​

​

​

​

​

​

​

​

​

Selling, general and administrative expenses

​

29,680,788

​

6,911,278

​

49,609,275

​

21,527,122

​

Transaction related expenses

​

​

803,724

​

​

—

​

​

6,777,864

​

​

—

​

Stock-based compensation expenses

​

4,006,712

​

1,304,919

​

9,618,192

​

1,424,140

​

Depreciation

​

552,589

​

76,292

​

1,017,287

​

222,763

​

Amortization

​

1,530,230

​

180,034

​

2,424,585

​

540,101

​

Total operating expenses

​

36,574,043

​

8,472,523

​

69,447,203

​

23,714,126

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Income from operations

​

808,956

​

3,851,447

​

765,955

​

14,404,914

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Other income (expense):

​

​

​

​

​

​

​

​

​

Interest expenses, net

​

(6,906,226)

​

(7,363,655)

​

(22,153,565)

​

(23,604,746)

​

Gain (loss) on disposal of assets and debt

​

(7,837,671)

​

—

​

(7,843,515)

​

(218,327)

​

Other income (expenses)

​

983,080

​

970,850

​

1,365,445

​

3,881,931

​

Other income (expenses), net

​

(13,760,817)

​

(6,392,805)

​

(28,631,635)

​

(19,941,142)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Loss before income taxes

​

(12,951,861)

​

(2,541,358)

​

(27,865,680)

​

(5,536,228)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Current income tax expenses

​

(13,347,000)

​

(2,385,000)

​

(19,876,000)

​

(6,770,000)

​

Net loss and comprehensive loss

​

(26,298,861)

​

(4,926,358)

​

(47,741,680)

​

(12,306,228)

​

Net loss per share - basic and diluted

​

$

(0.03)

​

$

(0.02)

​

$

(0.08)

​

$

(0.08)

​

Weighted average shares used in computation of net loss per share - basic and diluted

​

​

949,820,535

​

​

201,377,275

​

​

627,654,382

​

​

162,836,874

​

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

​

​

4

Table of Contents

VIREO GROWTH INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIENCY)

(In U.S. Dollars, except share amounts, unaudited)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Common Stock

​

​

​

​

​

​

​

​

​

​

​

SVS

​

MVS

​

Super Voting Shares

​

​

​

​

​

​

​

Total

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Additional Paid-

​

Accumulated

​

Stockholders'

​

Shares

Amount

Shares

Amount

Shares

Amount

in Capital

Deficit

Equity (deficiency)

Balance, January 1, 2024

​

110,007,030

​

$

—

331,193

​

$

—

—

​

$

—

​

$

187,384,403

​

$

(203,428,052)

​

$

(16,043,649)

Conversion of MVS shares

3,287,900

​

—

(32,879)

​

—

—

​

—

​

—

​

—

​

—

Stock-based compensation

—

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

1,424,140

​

​

—

​

1,424,140

Options exercised

​

50,000

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

16,500

​

​

—

​

​

16,500

Warrants exercised

​

303,127

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

43,953

​

​

—

​

​

43,953

Shares issued

​

13,800,078

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

6,087,500

​

​

—

​

​

6,087,500

Conversion of convertible debt

​

73,016,061

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

9,774,557

​

​

—

​

​

9,774,557

Net Loss

—

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

—

​

​

(12,306,228)

​

(12,306,228)

Balance at September 30, 2024

200,464,196

​

$

—

298,314

​

$

—

—

​

$

—

​

$

204,731,053

​

$

(215,734,280)

​

$

(11,003,227)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Balance, January 1, 2025

​

337,512,681

​

​

—

285,371

​

​

—

—

​

​

—

​

​

286,999,084

​

​

(231,435,561)

​

​

55,563,523

Conversion of MVS shares

​

2,573,900

​

​

—

​

(25,739)

​

​

—

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Stock-based compensation

​

—

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

9,618,192

​

​

—

​

​

9,618,192

Shares issued

1,752,004

​

—

—

​

—

—

​

—

​

—

​

—

​

—

Net settlement of stock-based compensation

​

(365,871)

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

(156,337)

​

​

—

​

​

(156,337)

Options exercised

​

508,165

​

—

—

​

—

—

​

—

​

​

90,890

​

​

—

​

​

90,890

Warrants exercised

​

265,626

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

38,516

​

​

—

​

​

38,516

Shares issued in connection with Wholesome acquisition

​

134,229,986

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

51,764,710

​

​

—

​

​

51,764,710

Shares issued in connection with the Proper acquisition

​

196,212,265

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

76,188,889

​

​

—

​

​

76,188,889

Shares issued in connection with the Deep Roots acquisition

​

251,210,053

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

100,938,819

​

​

—

​

​

100,938,819

Net Loss

—

​

—

—

​

—

—

​

—

​

—

​

(47,741,680)

​

(47,741,680)

Balance at September 30, 2025

923,898,809

​

$

—

259,632

​

$

—

—

​

$

—

​

$

525,482,763

​

$

(279,177,241)

​

$

246,305,522

​

​

Common Stock

​

​

​

​

​

​

​

​

​

​

​

SVS

​

MVS

​

Super Voting Shares

​

​

​

​

​

​

​

Total

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Additional Paid-

​

Accumulated

​

Stockholders'

​

Shares

Amount

Shares

Amount

Shares

Amount

in Capital

Deficit

Equity (deficiency)

Balance, July 1, 2024

114,605,008

​

$

—

300,714

​

$

—

—

​

$

—

​

$

188,249,124

​

$

(210,807,922)

​

$

(22,558,798)

Conversion of MVS shares

​

240,000

​

​

—

​

(2,400)

​

​

—

​

—

​

​

—

​

​

—

​

​

—

​

​

—

Stock-based compensation

—

​

—

—

​

—

—

​

—

​

1,304,919

​

—

​

1,304,919

Warrants exercised

​

103,127

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

14,953

​

​

—

​

​

14,953

Shares issued

12,500,000

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

5,387,500

​

​

—

​

​

5,387,500

Conversion of convertible debt

​

73,016,061

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

9,774,557

​

​

—

​

​

9,774,557

Net Loss

—

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

—

​

​

(4,926,358)

​

(4,926,358)

Balance at September 30, 2024

​

200,464,196

​

$

—

​

298,314

​

$

—

​

—

​

$

—

​

$

204,731,053

​

$

(215,734,280)

​

$

(11,003,227)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Balance, July 1, 2025

​

923,839,190

​

$

—

​

259,632

​

$

—

​

—

​

$

—

​

$

521,456,870

​

$

(252,878,380)

​

$

268,578,490

Stock-based compensation

​

—

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

4,006,712

​

​

—

​

​

4,006,712

Options exercised

​

59,619

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

10,276

​

​

—

​

​

10,276

Shares issued in connection with the Deep Roots acquisition

​

—

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

8,905

​

​

—

​

​

8,905

Net Loss

​

—

​

​

—

​

—

​

​

—

​

—

​

​

—

​

​

—

​

​

(26,298,861)

​

​

(26,298,861)

Balance at September 30, 2025

​

923,898,809

​

$

—

​

259,632

​

$

—

​

—

​

$

—

​

$

525,482,763

​

$

(279,177,241)

​

$

246,305,522

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

​

​

​

​

5

Table of Contents

VIREO GROWTH INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In U.S. Dollars, unaudited)

​

​	​	​	​	​	​	​
​	​	Nine Months Ended September 30,
​		2025			2024
CASH FLOWS FROM OPERATING ACTIVITIES	​	​			​
Net loss	​	$	(47,741,680)	​	$	(12,306,228)
Adjustments to reconcile net loss to net cash used in operating activities:	​			​		​
Non-cash amortization of inventory step up included in product costs	​	​	16,549,749	​	​	—
Inventory valuation adjustments	​		1,203,336	​		130,000
Depreciation	​		1,017,287	​		222,763
Depreciation capitalized into inventory	​		3,177,308	​		1,678,434
Non-cash operating lease expense	​		1,093,085	​		323,309
Amortization of intangible assets	​		2,424,585	​		540,101
Amortization of intangible assets capitalized into inventory	​	​	64,823	​	​	74,336
Stock-based payments	​		9,461,855	​		1,424,140
Warrants held	​	​	937,861	​	​	(3,284,619)
Derivative (gain) loss	​	​	160,778	​	​	—
Loss on extinguishment of debt	​	​	4,911,988	​	​	—
Interest Expense	​		3,074,234	​		3,806,093
Bad debt expense	​		313,618	​		230,818
Accretion of interest on right-of-use finance lease liabilities	​		160,392	​		168,464
Loss (gain) on disposal of assets	​	​	(863,813)	​	​	120,856
Change in operating assets and liabilities:	​		​	​		​
Accounts Receivable	​		(4,192,453)	​		173,047
Prepaid expenses	​		(953,498)	​		(496,757)
Inventory	​		(2,396,728)	​		(482,192)
Income taxes	​	​	8,832,232	​	​	361,154
Uncertain tax position liabilities	​	​	14,411,000	​	​	6,410,000
Accounts payable and accrued liabilities	​		(18,800,446)	​		1,213,360
Changes in operating lease liabilities	​	​	(1,829,045)	​		(404,556)
Change in assets and liabilities held for sale	​		(5,960,720)	​		(3,693,771)
Net cash used in operating activities	​	​	(14,944,252)	​	​	(3,791,248)
​	​	​	​	​	​	​
CASH FLOWS FROM INVESTING ACTIVITIES:	​			​
Purchases of property, plant, and equipment	​	​	(18,461,912)	​	​	(8,974,901)
Proceeds from note receivable	​	​	—	​	​	3,600,000
Purchase of marketable securities	​	​	(1,012,527)	​	​	—
Acquisition of WholesomeCo, Inc., net of cash paid	​	​	7,025,811	​	​	—
Acquisition of Deep Roots Holdings, Inc., net of cash paid	​	​	19,382,607	​	​	—
Acquisition of Proper Holdings Management, Inc., net of cash paid	​	​	12,951,202	​	​	—
Capitalized software development costs	​	​	(1,065,611)	​	​	—
Deposits	​	​	(638,262)	​	​	(150,100)
Net cash provided by (used in) investing activities	​	​	18,181,308	​	​	(5,525,001)
​	​	​	​	​	​	​
CASH FLOWS FROM FINANCING ACTIVITIES	​	​		​	​
Proceeds from long-term debt, net of issuance costs	​	​	146,789,514	​	​	1,131,400
Proceeds from issuance of shares	​	​	—	​	​	700,000
Proceeds from warrant exercises	​	​	38,516	​	​	43,953
Proceeds from option exercises	​	​	90,890	​	​	16,500
Debt principal payments	​	​	(124,221,605)	​	​	(1,098,000)
Lease principal payments	​	​	—	​	​	(162,405)
Net cash provided by (used in) financing activities	​	​	22,697,315	​	​	631,448
​	​	​	​	​	​	​
Net change in cash	​	​	25,934,371	​	​	(8,684,801)
​	​	​	​	​	​	​
Cash, beginning of period	​	​	91,604,970	​	​	15,964,665
​	​	​	​	​	​	​
Cash, end of period	​	$	117,539,341	​	$	7,279,864

​

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

​

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VIREO GROWTH INC.

Notes to Unaudited Condensed Consolidated Financial Statements

1. Description of Business and Summary

Vireo Growth Inc. (“Vireo Growth” or the “Company”) was incorporated under the Alberta Business Corporations Act on November 23, 2004, and continued under the British Columbia Corporations Act on December 9, 2013. The Company's subordinate voting shares are listed on the Canadian Securities Exchange (the “CSE”) and quoted on the OTCQX under the ticker symbols “VREO” and “VREOF”, respectively.

​

Vireo Growth was founded in 2014 as a medical cannabis company and has since developed a disciplined, strategically aligned platform within the cannabis industry. The Company’s mission is to provide safe access, quality products, and value to its customers. Vireo Growth operates cultivation, production, and dispensary facilities in Maryland, Minnesota, Missouri, Nevada, New York, and Utah. The Company allocates capital and talent to areas expected to generate long-term value and operates with a commitment to accountability, efficiency, and its stakeholders, including customers, employees, shareholders, and the communities it serves.

​

While marijuana and CBD-infused products are legal under the laws of several U.S. states (with vastly differing restrictions), the United States Federal Controlled Substances Act (the “CSA”) classifies all “marijuana” as a Schedule I drug. Under U.S. federal law, a Schedule I drug or substance has a high potential for abuse, has no accepted medical use in the United States, and lacks accepted safety for use under medical supervision. Recently, some federal officials have attempted to distinguish between medical cannabis and adult-use cannabis by indicating that medical cannabis is necessary while adult-use cannabis is “still a violation of federal law.” At the present time, the distinction between “medical marijuana” and “adult-use marijuana” does not exist under U.S. federal law.

​

Merger Agreements with Deep Roots, Proper and Wholesome

​

On December 18, 2024, the Company entered into merger agreements (each a “Merger Agreement” and collectively, the “Merger Agreements”) with each of (i) Deep Roots Holdings, Inc. (“Deep Roots”) (the “Deep Roots Merger”), (ii) Proper Holdings, LLC (“Proper”), NGH Investments, Inc. (“NGH”), and Proper Holdings Management, Inc. (“Proper MSA Newco” and together with Proper and NGH, the “Proper Companies”) (the “Proper Mergers”), and (iii) WholesomeCo, Inc. (“Wholesome”) (the “Wholesome Merger” and collectively with the Deep Roots Merger and the Proper Mergers, the “Mergers” and each, a “Merger”). Each Merger was an all-share transaction whereby, at the closing of each Merger, (i) a new wholly-owned subsidiary of the Company merged with and into Deep Roots, (ii) a new wholly-owned subsidiary of the Company merged with and into Wholesome, and (iii) the Proper Companies each merged with and into new wholly-owned subsidiaries of the Company. Each of the Deep Roots Merger, the Proper Mergers and Wholesome Merger closed during the nine months ended September 30, 2025. See Note 3 “Business Combinations and Dispositions” for additional information.

​

​

2. Summary of Significant Accounting Policies

Significant Accounting Policies

The Company’s significant accounting policies are described in Note 2 to the Company’s consolidated financial statements included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the United States Securities and Exchange Commission (“SEC”) on March 4, 2025, (the "Annual Financial Statements"). There have been no material changes to the Company’s significant accounting policies.

Basis of presentation

The accompanying interim unaudited condensed consolidated financial statements reflect the accounts of the Company. The information included in these statements should be read in conjunction with the Annual Financial Statements. The unaudited condensed consolidated financial statements were prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the SEC. In the

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opinion of management, the financial data presented includes all adjustments necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented. Results of interim periods should not be considered indicative of the results for the full year. These unaudited interim condensed consolidated financial statements include estimates and assumptions of management that affect the amounts reported in the unaudited condensed consolidated financial statements. Actual results could differ from these estimates.

Basis of consolidation

These unaudited condensed consolidated financial statements include the accounts of the following entities that were wholly owned, or effectively controlled by the Company during the period ended September 30, 2025:

​

​	​
Name of entity	Place of  incorporation
HiColor, LLC	Minnesota, USA
MaryMed, LLC	Maryland, USA
Vireo Health of Minnesota, LLC	Minnesota, USA
MJ Distributing C201, LLC	Nevada, USA
MJ Distributing P132, LLC	Nevada, USA
Resurgent Biosciences, Inc.	Delaware, USA
Verdant Grove, Inc.	Delaware, USA
Vireo Health de Puerto Rico, Inc.	Puerto Rico
Vireo Health of Colorado, LLC	Colorado, USA
Vireo Health of Nevada 1, LLC	Nevada, USA
Vireo Health of New York, LLC	New York, USA
Vireo Health of Puerto Rico, LLC	Delaware, USA
Vireo Health, Inc.	Delaware, USA
Vireo of Charm City, LLC	Maryland, USA
Vireo PR Merger Sub Inc.	Missouri, USA
Vireo PR Merger Sub II Inc.	Missouri, USA
Deep Roots Holdings, Inc.	Nevada, USA
Wholesomeco, Inc.	Delaware, USA
New Growth Horizon, LLC	Missouri, USA
Nirvana Investments, LLC and Subsidiaries	Missouri, USA
2178 State Highway 29A LLC	New York, USA
XAAS Agro, Inc.	Puerto Rico
Vireo Marketing, LLC	Minnesota, USA
Deep Roots Harvest, Inc.	Nevada, USA
Deep Roots Aria AcqCo, Inc.	Nevada, USA
Deep Roots Operating, Inc.	Nevada, USA
Deep Roots Properties, LLC	Nevada, USA
WC Staffing, LLC	Utah, USA
Wholesome Goods, LLC	Utah, USA
Wholesome Ag, LLC	Utah, USA
Wholesome Direct, LLC	Utah, USA
Wholesome Therapy, LLC	Utah, USA
Arches IP, Inc.	Delaware, USA

​

The entities listed above were formed or acquired to support the intended operations of the Company. All intercompany transactions and balances have been eliminated from the Company's unaudited condensed consolidated financial statements.

Recently adopted accounting pronouncements

None.

​

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Net loss per share

Basic net loss per share is computed by dividing reported net loss by the weighted average number of common shares outstanding for the reported period. Diluted net loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock of the Company during the reporting period. Diluted net loss per share is computed by dividing net loss by the sum of the weighted average number of common shares and the number of potential dilutive common share equivalents outstanding during the period. Potential dilutive common share equivalents consist of the incremental common shares issuable upon the exercise of vested share options and the incremental shares issuable upon conversion of the convertible notes. Potential dilutive common share equivalents consist of stock options, warrants, and restricted stock units (“RSUs”).

In computing diluted earnings per share, common share equivalents are not considered in periods in which a net loss is reported, as the inclusion of the common share equivalents would be anti-dilutive. The Company recorded a net loss for each of the three and nine-month periods ended September 30, 2025 and 2024, as presented in these financial statements, and as such there is no difference between the Company’s basic and diluted net loss per share for these periods.

The anti-dilutive shares outstanding for the nine-month periods ended September 30, 2025 and 2024, were as follows:

​

​	​	​	​	​
​	​	Nine Months Ended
​	​	September 30,
​	​	2025		2024
Stock options	​	27,933,898		31,440,328
Warrants	​	18,541,586		19,134,522
RSUs	​	73,173,350	​	4,107,749
Convertible debt	​	16,000,000	​	—
Total	​	135,648,834		54,682,598

​

Revenue Recognition

The Company’s primary source of revenue is from the wholesale of cannabis products to dispensary locations and direct retail sales to eligible customers at Company-owned dispensaries. Substantially all of the Company’s retail revenue is from the direct sale of cannabis products to adult-use and medical customers.

The following table represents the Company’s disaggregated revenue by source:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended September 30,					​	Nine Months Ended September 30,
​		2025			2024		​	2025			2024
Retail	​	$	75,951,983	​	$	19,740,787	​	$	131,958,184	​	$	60,159,246
Wholesale	​		15,703,172	​		5,424,556	​		32,300,622	​		14,201,659
Total	​	$	91,655,155	​	$	25,165,343	​	$	164,258,806	​	$	74,360,905

​

New accounting pronouncements not yet adopted

None.

​

​

3. Business Combinations and Dispositions

Acquisitions

On December 18, 2024, the Company, entered into Merger Agreements with respect to the Mergers. Each Merger was an all-share transaction whereby, at the closing of each applicable Merger, (i) a new wholly-owned subsidiary of the Company

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merged with and into Deep Roots, (ii) a new wholly-owned subsidiary of the Company merged with and into Wholesome, and (iii) the Proper entities each merged with and into new wholly-owned subsidiaries of the Company.

​

The consideration paid to acquire each of Deep Roots, Proper and Wholesome was based, in each case, in part, on an estimated multiple of a 2024 “Closing EBITDA,” which was pro forma for pending acquisitions, planned new retail openings and expansion projects, and a US$0.52 share reference price for the Company’s subordinate voting shares (each subordinate voting share an “SVS” and collectively, the “SVSs”).

Pursuant to the Merger Agreements, former stockholders of Proper, Wholesome, and certain former stockholders of Deep Roots may qualify for earnout payments made with the Company’s SVSs following December 31, 2026, based on each target’s adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) (as defined in the applicable Merger Agreement) growth compared to such target’s Closing EBITDA (as defined in the applicable Merger Agreement) (plus, with respect to Deep Roots, $1,000,000 in EBITDA attributed to a new retail location) (at a 4x multiple), adjusted for incremental debt and certain other matters, respectively, and paid out using a share price for the Company’s SVSs of the higher of US$1.05 or the 20-day volume weighted average price of the Company’s SVSs on the Canadian Securities Exchange (“CSE”), converted to United States Dollars based on the average exchange rate posted by the Bank of Canada as of the end of each trading day during such 20-day period, as reported by Bloomberg Finance L.P. (the “VWAP”) as of December 31, 2026. The Closing EBITDA for Deep Roots, Proper and Wholesome are US$30.0 million, US$31.0 million, and US$16.0 million, respectively. EBITDA growth is defined as the increase between the Closing EBITDA and the higher of 2026 Adjusted EBITDA or the trailing nine-month annualized Adjusted EBITDA as of immediately prior to December 31, 2026. In no event shall the number of earnout shares issued under each Merger Agreement exceed the number of shares issued as closing merger consideration under each Merger Agreement.

Each of the Merger Agreements provides for the clawback of up to 50% of the upfront merger consideration (excluding, in the case of Proper and Wholesome, the amounts described in the next paragraph that are attributable to Arches, as defined below) on December 31, 2026, if (1) for Wholesome and Deep Roots, (a) 2026 Adjusted EBITDA underperforms 96.5% of the Closing EBITDA, and (b) the retail revenue market share or EBITDA margin for 2026 is less (or lower) than 2024 and (c) the 20-day VWAP as of immediately prior to December 31, 2026 is greater than US$1.05 per share, and (2) for Proper, 2026 Adjusted EBITDA underperforms 96.5% of the Closing EBITDA. The amount of shares subject to a clawback would be equal to the Acquisition Multiple (as defined in each Merger Agreement) of 4.175 for each of Deep Roots, Proper and Wholesome, respectively, multiplied by the EBITDA shortfall, and subject to certain other adjustments for incremental debt and certain other matters, set forth in the applicable Merger Agreement, divided by US$0.52 per share.

​

In connection with the Merger Agreement with Wholesome (the “Wholesome Merger Agreement”) and the Merger Agreement with Proper (the “Proper Merger Agreement”), the Company will include in the stock merger consideration calculation an amount equal to (i) US$11,860,800 for Wholesome and (ii) US$2,139,200 for Proper for all of the outstanding equity interests in Arches IP, Inc. (“Arches”) owned by Wholesome and Proper, respectively. Subject to the terms and conditions of the Wholesome Merger Agreement and the Proper Merger Agreement, each of Wholesome, Proper and Arches option holders are collectively entitled to earnout payments based on the performance of Arches, based on the greater of US$37.5 million or 5x certain revenue percentages of Arches minus $4,000,000, with such revenue percentage amounts measured at the higher of the trailing-twelve-month or nine-month annualized amounts as of December 31, 2026, paid out using a share price for the Company’s SVSs at the higher of US$1.05 or the 20-day VWAP as of immediately prior to December 31, 2026.

Wholesome

​

On May 12, 2025, the Company closed the Wholesome Merger contemplated by the Wholesome Merger Agreement. The Company analyzed the acquisition under Accounting Standards Update (“ASU”) 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business and determined that the Wholesome Merger should be accounted for as a business combination. Goodwill represents the premium the Company paid over the fair value of the net tangible and intangible assets acquired. The goodwill arising from the Wholesome Merger primarily consists of the synergies and economies of scale expected from combining the operations of the Company and Wholesome, including growing the Company's customer base, acquiring assembled workforces, and expanding its presence in new and existing markets.

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These benefits were not recognized separately from goodwill because they do not meet the recognition criteria for identifiable intangible assets.

​

The following table summarizes the allocation of consideration exchanged for the estimated fair value of tangible and identifiable intangible assets acquired and liabilities assumed:

​

​	​	​	​
​		Wholesome
Assets		​
Cash and cash equivalents	​	$	7,025,811
Inventory	​		9,766,340
Receivables	​	​	1,149,766
Other current assets	​		905,747
Property and equipment	​		9,273,661
Operating lease, right-of-use asset	​		10,410,672
Indemnification asset	​	​	6,910,000
Deposits	​	​	504,807
Intangible assets, license	​		13,955,000
Intangible assets, developed technology	​	​	10,152,000
Goodwill	​		26,664,881
Total assets	​		96,718,685
Liabilities	​
Accounts payable and accrued liabilities	​		6,599,747
Right-of-use liability	​		10,410,672
Long-term debt, net	​	​	9,592,555
Uncertain tax liability	​	​	8,910,000
Total liabilities	​	​	35,512,974
Net assets acquired	​	$	61,205,711
​	​	​	​
Consideration:	​	​	​
Share consideration	​	$	51,764,711
Contingent consideration	​	​	9,441,000
Total Consideration	​	$	61,205,711

​

The acquired intangible assets include cannabis licenses and developed technology which are treated as definite-lived intangible assets amortized over a 15-year useful life.

​

As of September 30, 2025, the Company has recorded a contingent consideration liability of $9,441,000, which represents the estimated fair value of the potential earnout payments based on management’s current projections of Adjusted EBITDA performance relative to the Closing EBITDA thresholds. This contingent consideration is classified as a Level 3 liability within the fair value hierarchy and will be remeasured at each reporting date with changes in fair value recognized in earnings.

​

As part of the Wholesome Merger, the sellers contractually agreed to indemnify the Company for certain pre-closing liabilities, including those related to unpaid uncertain tax liabilities. On May 12, 2025, the Company recognized a liability of $8,910,000 for uncertain tax positions related to the pre-acquisition periods in accordance with Accounting Standards Codification (“ASC”) 740, Income Taxes. Consistent with the provisions of ASC 805-20-25-27, the Company also recognized a corresponding indemnification asset of $6,910,000, measured on the same basis as the related liability, which represents the uncertain tax liability recognized of $8,910,000 less $2,000,000 of tax specific cash contributions from Wholesome.

​

The indemnification asset was classified as a non-current asset in the Company’s condensed consolidated balance sheet as of September 30, 2025, and will be adjusted in future periods if the related liability is settled, released, or remeasured. Changes in the fair value of the indemnification asset, if any, will be recorded in earnings in the same financial statement

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line item as the change in the related liability. As of September 30, 2025, there have been no changes in the estimated amount of indemnified tax exposure or the related asset.

​

Supplemental pro forma information (unaudited) for Wholesome Merger

​

The unaudited pro forma information for the periods set forth below gives effect to the Wholesome Merger as if the acquisition had occurred on January 1, 2025. This pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved had the transaction been consummated as of that time nor does it purport to be indicative of future financial operating results.

​

Proforma revenues attributable to subordinate voting shareholders for the three and nine-month periods ended September 30, 2025 were $13,333,924 and $40,010,028, respectively. Proforma net loss attributable to subordinate voting shareholders for the three and nine month periods ended September 30, 2025 were $588,353 and $3,952,075, respectively.

​

Unaudited pro forma net income reflects the adjustment of sales between the companies, and adjustments for alignment of significant differences in accounting principles and elections.

​

Proper

​

On June 5, 2025, the Company closed the Proper Mergers contemplated by the Proper Merger Agreement. The Company analyzed the acquisition under ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business and determined that the Proper Mergers should be accounted for as a business combination. Goodwill represents the premium the Company paid over the fair value of the net tangible and intangible assets acquired. The goodwill arising from the Proper Mergers primarily consists of the synergies and economies of scale expected from combining the operations of the Company and Proper, including growing the Company's customer base, acquiring assembled workforces, and expanding its presence in new and existing markets. These benefits were not recognized separately from goodwill because they do not meet the recognition criteria for identifiable intangible assets.

​

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The following table summarizes the allocation of consideration exchanged for the estimated fair value of tangible and identifiable intangible assets acquired and liabilities assumed:

​

​	​	​	​
​		Proper
Assets		​
Cash and cash equivalents	​	$	12,951,202
Inventory	​		16,882,060
Income tax receivable	​	​	4,258,449
Receivables	​	​	2,399,311
Other current assets	​		299,524
Property and equipment	​		34,349,806
Operating lease, right-of-use asset	​		6,905,781
Indemnification asset	​	​	5,311,551
Deposits	​	​	131,808
Intangible assets, license	​	​	14,427,000
Goodwill	​		52,024,283
Total assets	​		149,940,775
Liabilities	​
Accounts payable and accrued liabilities	​		24,481,450
Right-of-use liability	​		6,905,781
Long-term debt, net	​	​	25,502,655
Uncertain tax liability	​	​	12,570,000
Other long-term liabilities	​	​	1,239,000
Total liabilities	​	​	70,698,886
Net assets acquired	​	$	79,241,889
​	​	​	​
Consideration:	​	​	​
Share consideration	​	$	76,188,889
Contingent consideration	​	​	3,053,000
Total Consideration	​	$	79,241,889

​

The acquired intangible assets include cannabis licenses and developed technology which are treated as definite-lived intangible assets amortized over a 15-year useful life.

​

As of September 30, 2025, the Company recorded a contingent consideration liability of $3,053,000, which represents the estimated fair value of the potential earnout payments based on management’s current projections of Adjusted EBITDA performance relative to the Closing EBITDA thresholds. This contingent consideration was classified as a Level 3 liability within the fair value hierarchy and will be remeasured at each reporting date with changes in fair value recognized in earnings.

​

As part of the Proper Mergers, the sellers contractually agreed to indemnify the Company for certain pre-closing liabilities, including those related to unpaid uncertain tax liabilities. On June 5, 2025, the Company recognized a liability of $12,570,000 for uncertain tax positions related to the pre-acquisition periods in accordance with ASC 740, Income Taxes. Consistent with the provisions of ASC 805-20-25-27, the Company also recognized a corresponding indemnification asset of $5,311,551, measured on the same basis as the related liability, which represents the uncertain tax liability recognized of $12,570,000 less $4,258,449 of income taxes receivable and $3,000,000 of tax specific cash contributions from Proper.

​

The indemnification asset was classified as a non-current asset in the Company’s condensed consolidated balance sheet as of September 30, 2025, and will be adjusted in future periods if the related liability is settled, released, or remeasured. Changes in the fair value of the indemnification asset, if any, will be recorded in earnings in the same financial statement line item as the change in the related liability. As of September 30, 2025, there were no changes in the estimated amount of indemnified tax exposure or the related asset.

​

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Supplemental pro forma information (unaudited) for Proper Mergers

​

The unaudited pro forma information for the periods set forth below gives effect to the Proper Mergers as if the acquisition had occurred on January 1, 2025. This pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved had the transaction been consummated as of that time nor does it purport to be indicative of future financial operating results.

​

Proforma revenues attributable to subordinate voting shareholders for the three and nine-month periods ended September 30, 2025 were $24,856,947 and $71,162,748, respectively. Proforma net loss attributable to subordinate voting shareholders for the three and nine-month periods ended September 30, 2025 were $2,238,477 and $2,499,499, respectively.

​

Unaudited pro forma net income reflects the adjustment of sales between the companies, and adjustments for alignment of significant differences in accounting principles and elections.

​

Deep Roots

​

On June 6, 2025, the Company closed the Deep Roots Merger contemplated by the Merger Agreement with Deep Roots (the “Deep Roots Merger Agreement”). The Company analyzed the acquisition under ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business and determined that the Deep Roots Merger should be accounted for as a business combination. Goodwill represents the premium the Company paid over the fair value of the net tangible and intangible assets acquired. The goodwill arising from the Deep Roots Merger primarily consists of the synergies and economies of scale expected from combining the operations of the Company and Deep Roots, including growing the Company's customer base, acquiring assembled workforces, and expanding its presence in new and existing markets. These benefits were not recognized separately from goodwill because they do not meet the recognition criteria for identifiable intangible assets.

​

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The following table summarizes the allocation of consideration exchanged for the estimated fair value of tangible and identifiable intangible assets acquired and liabilities assumed:

​

​	​	​	​
​		Deep Roots
Assets		​
Cash and cash equivalents	​	$	19,382,607
Inventory	​		20,108,335
Income tax receivable	​	​	8,295,721
Receivables	​	​	162,031
Other current assets	​		1,305,072
Property and equipment	​		30,371,707
Operating lease, right-of-use asset	​		12,742,380
Indemnification asset	​	​	5,307,586
Deposits	​	​	433,309
Investments	​		6,000,000
Intangible assets, license	​	​	44,642,000
Goodwill	​		18,599,951
Total assets	​		167,350,699
Liabilities	​
Accounts payable and accrued liabilities	​		16,474,524
Right-of-use liability	​		12,742,380
Long-term debt, net	​	​	19,166,670
Uncertain tax liability	​	​	15,603,307
Total liabilities	​		63,986,881
Net assets acquired	​	$	103,363,818
​	​	​	​
Consideration:	​	​	​
Share consideration	​	$	100,938,818
Contingent consideration	​		2,425,000
Total Consideration	​	$	103,363,818

​

The acquired intangible assets include cannabis licenses which are treated as definite-lived intangible assets amortized over a 15-year useful life.

​

As part of the Deep Roots Merger, the sellers contractually agreed to indemnify the Company for certain pre-closing liabilities, including those related to unpaid uncertain tax liabilities. On June 6, 2025, the Company recognized a liability of $15,603,307 for uncertain tax positions related to the pre-acquisition periods in accordance with ASC 740, Income Taxes. Consistent with the provisions of ASC 805-20-25-27, the Company also recognized a corresponding indemnification asset of $5,307,586, measured on the same basis as the related liability, which represents the uncertain tax liability recognized of $15,603,307 less $8,295,721 of income taxes receivable and $2,000,000 of tax specific cash contributions from Deep Roots.

​

As of September 30, 2025, the Company recorded a contingent consideration liability of $2,425,000, which represents the estimated fair value of the potential earnout payments based on management’s current projections of Adjusted EBITDA performance relative to the Closing EBITDA thresholds. This contingent consideration was classified as a Level 3 liability within the fair value hierarchy and will be remeasured at each reporting date with changes in fair value recognized in earnings.

​

The indemnification asset was classified as a non-current asset in the Company’s condensed consolidated balance sheet as of September 30, 2025, and will be adjusted in future periods if the related liability is settled, released, or remeasured. Changes in the fair value of the indemnification asset, if any, will be recorded in earnings in the same financial statement line item as the change in the related liability. As of September 30, 2025, there were no changes in the estimated amount of the indemnified tax exposure or the related asset.

​

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Supplemental pro forma information (unaudited) for Deep Roots Merger

​

The unaudited pro forma information for the periods set forth below gives effect to the Deep Roots Merger as if the acquisition had occurred on January 1, 2025. This pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved had the transaction been consummated as of that time nor does it purport to be indicative of future financial operating results.

​

Proforma revenues attributable to subordinate voting shareholders for the three and nine-month periods ended September 30, 2025 were $24,971,054 and $73,766,886, respectively. Proforma net loss attributable to subordinate voting shareholders for the three and nine-month periods ended September 30, 2025 were $4,052,736 and $4,752,918, respectively.

​

Unaudited pro forma net income reflects the adjustment of sales between the companies, and adjustments for alignment of significant differences in accounting principles and elections.

​

Purchase Price Allocations

​

The above purchase price allocations are provisional specifically for determination of any deferred tax impact, valuation of contingent consideration, fair value of assets and liabilities including measurement of working capital adjustments pending the adjustment periods defined within the acquisition transaction agreements. 

​

The Company will continue to examine the above during the measurement period and adjustments will be made based on facts and circumstances that existed at the acquisition date once subsequently finalized and within the measurement period. 

​

Assets Held for Sale

​

As of September 30, 2025, the Company identified property and equipment, deposits, and lease assets and liabilities associated with the businesses in New York, Nevada, and Massachusetts with carrying amounts that are expected to be recovered principally through sale or disposal rather than through continuing use. The Company believes the sale of these assets and liabilities is highly probable, they can be sold in their immediate condition, and the sales are expected to occur within the next twelve months. As such, these assets and liabilities have been classified as “held for sale.” Management does not believe these divestitures represent a strategic shift that has or will have a material effect on the Company’s consolidated operations and financial results, and as such, none of these divestitures are considered a discontinued operation. The carrying value of these net assets did not exceed fair value less expected cost to sell, and as such, the Company recorded no impairment loss. Assets and liabilities held for sale as of September 30, 2025 and December 31, 2024 were as follows:

​

​	​	​	​	​	​	​
Assets held for sale		September 30,			December 31,
​	​	2025		​	2024
Property and equipment	​	$	95,562,464	​	$	90,177,872
Intangible assets	​	​	972,000	​	​	972,000
Operating lease, right-of-use asset	​	​	3,381,613	​	​	3,381,613
Deposits	​	​	2,552,364	​	​	2,028,567
Total assets held for sale	​	$	102,468,441	​	$	96,560,052
​	​	​	​	​	​	​
Liabilities held for sale	​			​		​
Right of Use Liability	​	$	89,334,872	​	$	89,387,203
Total liabilities held for sale	​	$	89,334,872	​	$	89,387,203

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Current assets and liabilities held by our New York business have not been classified as held for sale. Pre-tax operating losses attributable to the New York business were $11,292,936 and $12,152,587 for the nine months ended September 30, 2025 and 2024, respectively.

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4. Fair Value Measurements

The Company complies with ASC 820, Fair Value Measurements, for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability.

Items measured at fair value on a non-recurring basis

The Company’s non-financial assets, such as prepayments and other current assets, long lived assets, including property and equipment and intangible assets, are measured at fair value when there is an indicator of impairment and are recorded at fair value only when an impairment charge is recognized. No indicators of impairment existed as of September 30, 2025, and therefore no impairment charges were recorded.

The carrying value of the Company’s marketable securities, accounts receivable, accounts payable, and accrued liabilities approximate their fair value due to their short-term nature, and the carrying value of notes receivable, long-term debt, and convertible debt approximates fair value as they bear a market rate of interest.

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The carrying value of the Company’s derivative liabilities utilize Level 2 inputs given the inputs are indirectly observable but not quoted for identical contracts.

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The carrying value of the Company’s warrants held and contingent consideration utilize Level 3 inputs given there is no market activity for the asset. The inputs used are further described in Note 18.

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5. Accounts Receivable

Trade receivables as of September 30, 2025 and December 31, 2024 were comprised of the following items:

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​	​	​	​	​	​	​
​	​	September 30,		​	December 31,
​		2025			2024
Trade receivables, net	​	$	11,191,654	​	$	2,870,181
Tax withholding receivables, net	​	​	—	​	​	174,660
Other	​		988,641	​		1,545,510
Total	​	$	12,180,295	​	$	4,590,351

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Included in the trade receivables, net balance at September 30, 2025, and December 31, 2024, was an allowance for doubtful accounts of $1,027,316 and $84,989, respectively. Included in the tax withholding receivable, net balance at December 31, 2024, was an allowance for doubtful accounts of $159,275.

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6. Inventory

Inventory as of September 30, 2025 and December 31, 2024 was comprised of the following items:

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​	​	​	​	​	​	​
​		September 30,		​	December 31,
​		2025			2024
Work-in-progress	​	$	30,001,142	​	$	13,859,238
Finished goods	​		18,315,395	​		5,933,200
Other	​		5,585,051	​		1,873,926
Total	​	$	53,901,588	​	$	21,666,364

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In connection with the closing of the Mergers, the Company recorded the acquired inventories at their estimated fair values in accordance with ASC 805, Business Combinations. Fair value represents the estimated selling price of the acquired inventory, less the expected costs to sell the inventory.

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The estimated fair value of the inventory exceeded cost, resulting in a fair value step-up adjustment to acquired inventories totaling $16,549,749. During the three and nine-months ended September 30, 2025, $12,397,641 and $16,549,749, respectively, of amortization associated with this fair value step-up was recorded. This amortization was recorded to cost of sales in the consolidated statement of loss and comprehensive loss for the three and nine month periods ended September 30, 2025.

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Inventory is written down for any obsolescence, spoilage and excess inventory or when the net realizable value of inventory is less than the carrying value. Inventory valuation adjustments included in cost of sales on the statements of net loss and comprehensive loss for the three and nine months ended September 30, 2025 and 2024 were comprised of the following:

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​	​	​	​	​	​	​	​	​	​	​	​	​
​		Three Months Ended September 30,					​	Nine Months Ended September 30,
​		2025			2024		​	2025			2024
Work-in-progress	​	$	252,698	​	$	433,283	​	$	227,508	​	$	231,583
Finished goods	​		743,787	​		(40,283)	​		975,828	​		(101,583)
Total	​	$	996,485	​	$	393,000	​	$	1,203,336	​	$	130,000

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7. Derivative Liability

During the nine months ended September 30, 2025, the Company entered into an interest rate swap contract with each of East West Bank and Western Alliance Bank for a notional amount of $15,000,000 per swap contract and an effective date of August 4, 2025, to hedge a portion of the interest rate exposure on its First Lien Term Loan (as defined in Note 12) that bears interest at a floating rate based on the Secured Overnight Financing Rate (“SOFR”). Under the terms of the swaps, the Company pays a fixed interest rate of 3.70% and receives a variable rate equal to SOFR on the same notional amount. The swap matures on July 31, 2027. See Note 12 "Long-Term Debt" for additional information.

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The swaps are designated as a cash flow hedge of forecasted variable interest payments under ASC 815-30. Hedge effectiveness is assessed prospectively and retrospectively using the hypothetical derivative method, and the hedge has been deemed highly effective since inception.

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These derivative instruments are recorded at fair value in the consolidated balance sheet with the changes in fair value of the derivative instruments that qualify as effective hedges being recorded as other income on the statement of loss and comprehensive loss for the three and nine month periods ended September 30, 2025. During the three and nine months ended September 30, 2025, the Company recorded other expense of $160,778 related to the changes and fair value of these derivative instruments.

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8. Property and Equipment, Net

As of September 30, 2025 and December 31, 2024, the Company’s property and equipment, net consisted of the following:

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​	​	​	​	​	​	​
​		September 30,		​	December 31,
​		2025			2024
Land	​	$	1,343,937	​	$	863,105
Buildings and leasehold improvements	​		78,688,844	​		16,355,616
Furniture and equipment	​		21,416,721	​		7,451,920
Software	​		50,690	​		39,388
Vehicles	​		2,132,893	​		491,022
Construction-in-progress	​		24,569,755	​		9,858,120
Right of use asset under finance lease	​		7,572,566	​		7,572,566
​	​		135,775,406	​		42,631,737
Less: accumulated depreciation	​		(14,533,452)	​		(10,319,975)
Total	​	$	121,241,954	​	$	32,311,762

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For the nine months ended September 30, 2025 and 2024, total depreciation on property and equipment was $4,194,595 and $1,901,198, respectively. For the nine months ended September 30, 2025 and 2024, accumulated amortization of the right of use asset (the “ROU”) under finance lease amounted to $2,759,356 and $2,408,998, respectively. The right of use asset under finance lease of $7,572,566 consists of leased processing and cultivation premises. The Company capitalized $3,177,308 and $1,678,435 into inventory relating to depreciation associated with manufacturing equipment and production facilities for the nine months ended September 30, 2025 and 2024, respectively. The associated capitalized depreciation costs are added to inventory and expensed as cost of sales when the product is sold.

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As of each of September 30, 2025 and 2024, in conjunction with the Company’s held for sale assessment and disposal of certain long-lived assets, the Company evaluated whether property and equipment showed any indicators of impairment, and it was determined that the recoverable amount of certain net assets was above book value. As a result, the Company recorded no impairment charge on property and equipment, net.

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9. Leases

Components of the Company’s lease expenses as of September 30, 2025 and 2024 are listed below:

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​	​	​	​	​	​	​
​		September 30,		​	September 30,
​		2025		​	2024
Finance lease cost	​	​	​	​	​
Depreciation of ROU assets	​	$	247,537	​	$	410,013
Interest on lease liabilities	​		10,750,264	​		10,654,530
Operating lease costs	​		4,179,971	​		1,412,489
Total lease costs	​	$	15,177,772	​	$	12,477,032

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Future minimum lease payments (principal and interest) on the leases are as follows:

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​	​	​	​	​	​	​	​	​	​
​		Operating Leases			Finance Leases			​	​
​		September 30, 2025			September 30, 2025			Total
2025	​	$	2,266,352	​	$	3,505,294	​	$	5,771,646
2026	​		9,052,432	​		14,183,661	​		23,236,093
2027	​		8,364,994	​		14,606,527	​		22,971,521
2028	​		7,825,020	​		15,042,128	​		22,867,148
2029	​		7,123,834	​		15,490,852	​		22,614,686
Thereafter	​		23,650,636	​		203,082,066	​		226,732,702
Total minimum lease payments	​	$	58,283,268	​	$	265,910,528	​	$	324,193,796
Less discount to net present value	​	​	(16,901,174)	​		(171,368,934)	​		(188,270,108)
Less liabilities held for sale	​	​	(2,481,882)	​	​	(86,897,778)	​	​	(89,379,660)
Present value of lease liability	​	$	38,900,212	​	$	7,643,816	​	$	46,544,028

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The Company has entered into various lease agreements for the use of buildings used in the production and retail sales of cannabis products.

Supplemental cash flow information related to the Company’s leases for the nine months ended September 30, 2025 and 2024 is detailed below:

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​	​	​	​	​	​	​
​		Nine Months Ended
​		September 30,
​		2025			2024
Cash paid for amounts included in the measurement of lease liabilities:	​	​			​
Lease principal payments - finance	​	$	—	​	$	162,405
Lease principal payments - operating	​	​	1,829,045	​	​	633,540
Non-cash additions to ROU assets	​		1,123,207	​		9,270,915
Amortization of operating leases	​		1,927,931	​		531,359

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Other information about the Company’s lease amounts as of September 30, 2025 and 2024 is recognized in the financial statements and outlined below:

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​	​	​	​	​	​	​
​		September 30,				​
​		2025		2024		​
Weighted-average remaining lease term (years) – operating leases	​	7.12		7.85	​	​
Weighted-average remaining lease term (years) – finance leases	​	15.34		16.34	​	​
Weighted-average discount rate – operating leases	​	10.83	%	8.16	%	​
Weighted-average discount rate – finance leases	​	16.18	%	16.20	%	​

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10. Intangibles

Intangible assets as of September 30, 2025 and December 31, 2024 were comprised of the following items:

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​	​	​	​	​	​	​	​	​	​
​		Licenses & Trademarks			Developed Technology			Total
Balance, December 31, 2023	​	$	8,718,577	​	$	—		$	8,718,577
Amortization	​	​	(819,250)	​		—	​	​	(819,250)
Balance, December 31, 2024	​	$	7,899,327	​	$	—		$	7,899,327
Acquisitions (Note 3)	​	​	73,024,002	​	​	10,152,000	​	​	83,176,002
Capitalization of internally generated software costs	​	​	—	​	​	1,065,610	​	​	1,065,610
Amortization	​		(2,357,811)	​		(131,597)			(2,489,408)
Balance, September 30, 2025	​	$	78,565,518	​	$	11,086,013		$	89,651,531

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Amortization expense for the Company’s intangibles was $1,554,917 and $2,489,408 during the three and nine months ended September 30, 2025, respectively, and $204,813 and $614,437 during the three and nine months ended September 30, 2024, respectively. The Company capitalized into inventory $24,687 and $64,823 of amortization for the three and nine months ended September 30, 2025, respectively, and $24,778 and $74,336 for the three and nine months ended September 30, 2024, respectively. Amortization expense is recorded in operating expenses on the unaudited condensed consolidated statements of net loss and comprehensive loss.

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The Company estimates that amortization expenses will be $6,364,721 per year for the next five fiscal years.

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11. Accounts Payable, Accrued Liabilities, and Restricted Cash

Accounts payable and accrued liabilities as of September 30, 2025 and December 31, 2024 were comprised of the following items:

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​	​	​	​	​	​	​
​		September 30,		​	December 31,
​		2025			2024
Accounts payable – trade	​	$	14,907,137	​	$	2,298,060
Accrued Expenses	​		17,757,096	​		6,839,822
Taxes payable	​		2,942,878	​		264,518
Contract liability	​		2,456,219	​		1,053,636
Other	​	​	479,959	​	​	—
Total accounts payable and accrued liabilities	​	$	38,543,289	​	$	10,456,036

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In connection with the closing of the Mergers and the related Merger Agreements, the Company is required to distribute cash to the former stockholders of Deep Roots and Proper. At September 30, 2025, $250,000 had yet to be distributed to the former stockholders of such entities. As such, the Company reclassified this cash as restricted cash, and recorded an associated liability, on the unaudited condensed consolidated balance sheet at September 30, 2025.

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As of September 30, 2025, the Company maintained a restricted cash account pursuant to the terms of the First Lien Term Loan (Note 12). Under the First Lien Term Loan, the Company is required to hold certain cash balances in a fully blocked deposit account (the “Restricted Cash Account”). The Restricted Cash Account is pledged as collateral to pay down the debt and may not be withdrawn or otherwise used by the Company without the consent of the Administrative Agent. Accordingly, the balance of $20,137,632 in this account is classified as restricted cash on the consolidated balance sheet.

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12. Long-Term Debt

Long-Term Debt Arising from the Mergers

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In connection with the closing of the Proper Mergers, the Company became obligated under $25,502,655 of notes payable due to Chicago Atlantic Admin, LLC. The unpaid principal amounts outstanding bore interest at a rate of (a) 11%, payable monthly in cash, and (b) 3.00% per annum PIK interest, payable monthly. In addition, 1% amortization of the original principal value of the note, or $27,100,000, was payable monthly, and the note was set to mature on November 28, 2025. See Note 3 “Business Combinations and Dispositions” for additional information.

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In connection with the closing of the Deep Roots Merger, the Company became obligated under $19,166,670 of notes payable due to Chicago Atlantic Admin, LLC. The unpaid principal amounts outstanding bore interest at a rate of (a) the U.S. prime rate, with a floor of 8.00%, plus (b) 6.50%, payable monthly in cash. In addition, 0.83% amortization of the original principal value of the note, or $20,000,000, was payable monthly, and the note was set to mature on August 15, 2027. See Note 3 “Business Combinations and Dispositions” for additional information.

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In connection with the closing of the Wholesome Merger, the Company became obligated on a $8,766,340 term loan bearing an interest rate of 11.25%, payable monthly in cash. The term loan was repaid in full on May 13, 2025. Additionally, the Company became obligated on $1,000,000 of promissory notes bearing an interest rate of 13.00%, payable monthly cash. See Note 3 “Business Combinations and Dispositions” for additional information.

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First Lien Term Loan and Chicago Atlantic Term Loan

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On July 7, 2025, the Company entered into a Loan and Security Agreement (the “First Lien Term Loan”), effective July 3, 2025, with East West Bank, a California banking corporation (“East West Bank”), as Administrative Agent (the “Administrative Agent”), and Western Alliance Bank, an Arizona corporation, as co-administrative agent (the “Co-Admin Agent”).

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The First Lien Term Loan provides for an aggregate principal amount of $120,000,000. The aggregate principal amount of the First Lien Term Loan amortizes in quarterly installments of $3,000,000. The Company will make such quarterly amortization payments commencing on December 31, 2025 and on the last business day of each quarter thereafter through and including June 30, 2028. Upon maturity of the First Lien Term Loan on July 31, 2028, the remaining outstanding principal amount of the First Lien Term Loan, and all accrued and unpaid interest thereon, will be due and payable in full. The First Lien Term Loan bears interest at the one-month Term Secured Overnight Financing Rate (subject to a 3% floor) plus 4% per annum. The First Lien Term Loan shall, at the Administrative Agent’s option, convert to a Prime Rate Loan at the end of the First Lien Term Loan’s current one-month interest period if an event of default shall occur and be continuing, at which time an additional 2% of default interest will also be applicable to the First Lien Term Loan.

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On July 7, 2025, the Company entered into a secured term loan (the “Chicago Atlantic Term Loan”), effective July 3, 2025, with Chicago Atlantic Opportunity Finance, LLC, as a Lender, Chicago Atlantic Admin, LLC, as Administrative Agent and Collateral Agent (“2L Agent”) and Chicago Atlantic Credit Advisers, LLC, as Lead Arranger (“Lead Arranger”).

The Chicago Atlantic Term Loan provides for a principal amount of $33,000,000 to be loaned to the Company along with a $50,000,000 accordion feature, available to support future strategic initiatives, subject to the sole discretion of the Lender and 2L Agent. Amortization payments are due and payable monthly on each payment date in an amount equal to 1% of the loan amount starting November 30, 2025. All unpaid and accrued interest is due and payable on the maturity date of October 2, 2028, with an option to extend for an additional year subject to a 1% extension fee of all loans advanced by lenders under the Chicago Atlantic Term Loan. The Chicago Atlantic Term Loan bears interest at the Prime Rate (subject to a 7.5% floor) plus 5.5% per annum.

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The First Lien Term Loan is secured by a perfected first priority security interest in all assets and future assets of the Company. The Chicago Atlantic Term Loan is secured by a second priority security interest in and lien on all existing assets and future assets of the Company.

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The proceeds from the First Lien Term Loan and Chicago Atlantic Term Loan were used to retire all of the Company’s existing debt obligations, including the debt arising from acquisitions, including the Mergers. In connection with the retirement of the existing debt, the Company recorded a loss on extinguishment of $8,627,647, of which $4,911,988 relates to the extinguishment of unamortized financing costs associated with the retired debt obligations, and $3,715,659 relates to make-whole fees paid. The loss on extinguishment is included in other expense on the statement of loss and comprehensive loss for the three and nine months ended September 30, 2025.

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Unless otherwise specified, all deferred financing costs are treated as a contra-liability, to be netted against the outstanding loan balance and amortized over the remaining life of the loan. As of September 30, 2025, and December 31, 2024, $5,704,695 and $6,576,985 of deferred financing costs remained unamortized, respectively.

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The following table shows a summary of the Company’s long-term debt as of September 30, 2025, and December 31, 2024:

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​	​	​	​	​	​	​
​		September 30,		​	December 31,
​		2025			2024
Beginning of period	​	$	62,338,046	​	$	60,220,535
Acquired long-term debt (Note 3)	​	​	54,261,880	​	​	—
Principal repayments	​	​	(10,002,221)	​	​	(1,234,000)
PIK interest	​	​	868,166	​	​	1,634,494
Debt extinguishment	​	​	(109,071,396)	​	​	—
Proceeds	​		153,000,000	​		6,700,000
Deferred financing costs	​	​	(6,210,486)	​	​	(7,418,770)
Amortization of deferred financing costs	​	​	2,111,316	​	​	2,435,787
End of period	​		147,295,305	​		62,338,046
Less: current portion	​		15,630,000	​		900,000
Total long-term debt	​	$	131,665,305	​	$	61,438,046

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As of September 30, 2025, stated maturities of long-term debt were as follows:

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​	​	​	​
2025	​	$	3,660,000
2026	​	​	15,960,000
2027	​	​	15,960,000
2028	​	​	111,715,305
Total	​	$	147,295,305

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13. Convertible Notes

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On July 31, 2024, holders voluntarily converted convertible notes issued in 2023 into 73,016,061 Subordinate Voting Shares of the Company.

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On November 1, 2024, the Company entered into the Joinder and Tenth Amendment to the Credit Agreement (the “Tenth Amendment”). The Tenth Amendment provides a convertible note facility (the “Convertible Notes”) with a maximum principal amount of $10,000,000. The Convertible Notes mature on November 1, 2027, have a cash interest rate of 12.0% per year, and are convertible into the Company’s SVSs at an amount determined by dividing the outstanding principal amount, plus all accrued but unpaid interest on the Convertible Notes on the date of such conversion, by a conversion price of $0.625. The Company incurred $145,717 in financing costs in connection with the signing of the Tenth Amendment.

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On July 7, 2025, the Company retired the Convertible Notes, and issued a $10,000,000 convertible note (the “New Convertible Notes”) to Chicago Atlantic Opportunity Finance, LLC, also with a second priority interest, that matures on October 2, 2028 with an option to extend for an additional year subject to a 1% extension fee of all Chicago Atlantic loans advanced, has a cash interest rate of Prime Rate (subject to a 7.5% floor) plus 5.0% per year, and is convertible into that

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number of the Company’s subordinate voting shares determined by dividing the outstanding principal amount plus all accrued but unpaid interest on the convertible notes on the date of such conversion by a conversion price of $0.625.

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All deferred financing costs are treated as a contra-liability, to be netted against the outstanding loan balance and amortized over the remaining life of the loan. As of September 30, 2025 and December 31, 2024, $103,891 and $137,622 of deferred financing costs remained unamortized, respectively.

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The following table shows a summary of the Company’s convertible debt as of September 30, 2025 and December 31, 2024:

​

​	​	​	​	​	​	​
​		September 30,		​	December 31,
​		2025			2024
Beginning of period	​	$	9,862,378	​	$	9,140,257
Principal repayments	​	​	(10,000,000)	​	​	​
Proceeds	​		10,000,000	​		10,000,000
Deferred financing costs	​	​	—	​	​	(145,717)
PIK interest	​	​	—	​	​	363,376
Amortization of deferred financing costs	​	​	33,731	​	​	279,019
Conversion	​	​	—	​	​	(9,774,557)
End of period	​	$	9,896,109	​	$	9,862,378
Less: current portion	​		1,650,000	​		—
Total convertible debt	​	$	8,246,109	​	$	9,862,378

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14. Stockholders’ Equity

Shares

The Company’s certificate of incorporation authorized the Company to issue the following classes of shares with the following par value and voting rights as of September 30, 2025. The liquidation and dividend rights are identical among shares equally in the Company’s earnings and losses on an as converted basis.

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​	​	​	​	​	​	​
​		Par Value		Authorized		Voting Rights
Subordinate Voting Share (“SVS”)		—		Unlimited		1 vote for each share
Multiple Voting Share (“MVS”)		—		Unlimited		100 votes for each share

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Subordinate Voting Shares

Holders of Subordinate Voting Shares are entitled to one vote in respect of each Subordinate Voting Share held.

Multiple Voting Shares

Holders of Multiple Voting Shares are entitled to one hundred votes for each Multiple Voting Share held.

Multiple Voting Shares each have the restricted right to convert to one hundred Subordinate Voting Shares subject to adjustments for certain customary corporate changes.

Shares Issued

During the nine months ended September 30, 2025, 134,229,986 Subordinate Voting Shares were issued in connection with the Wholesome Merger. See Note 3 “Business Combinations and Dispositions” for additional information.

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During the nine months ended September 30, 2025, 196,212,265 Subordinate Voting Shares were issued in connection with the Proper Mergers. See Note 3 “Business Combinations and Dispositions” for additional information.

During the nine months ended September 30, 2025, 251,210,053 Subordinate Voting Shares were issued in connection with the Deep Roots Merger. See Note 3 “Business Combinations and Dispositions” for additional information.

During the nine months ended September 30, 2025, 25,739 Multiple Voting Shares were converted into 2,573,900 Subordinate Voting Shares for no additional consideration.

During the nine months ended September 30, 2025, employee stock options were exercised for 508,165 Subordinate Voting Shares. Proceeds from this transaction were $90,890.

During the nine months ended September 30, 2025, 2025, stock warrants were exercised for 265,626 Subordinate Voting Shares. Proceeds from these transactions were $38,516.

During the nine months ended September 30, 2025, 2025, 1,752,003 shares were issued in connection with the settlement of RSUs. 365,871 shares were net settled to pay payroll taxes associated with the issuance, resulting in the final issuance of 1,386,132 shares.

During the nine months ended September 30, 2024, 32,879 Multiple Voting Shares were converted into 3,287,900 Subordinate Voting Shares for no additional consideration.

During the nine months ended September 30, 2024, 12,500,000 Subordinate Voting Shares were issued to the Company’s senior secured lender in connection with an amendment to the Company’s credit agreement.

During the nine months ended September 30, 2024, 1,300,078 Subordinate Voting Shares were issued to the Company’s senior secured lender, Chicago Atlantic Opportunity Portfolio, LP, for $700,000 of proceeds.

During the nine months ended September 30, 2024, the holders of the Company’s Convertible Notes voluntarily converted all outstanding convertible notes into 73,016,061 Subordinate Voting Shares of the Company.

During the nine months ended September 30, 2024, employee stock options were exercised for 50,000 Subordinate Voting Shares. Proceeds from this transaction were $16,500.

During the nine months ended September 30, 2024, stock warrants were exercised for 303,127 Subordinate Voting Shares. Proceeds from these transactions were $43,953.

​

​

15. Stock-Based Compensation

Stock Options

In January 2019, the Company adopted the 2019 Equity Incentive Plan (the “EIP”) under which the Company may grant incentive stock options, restricted shares, restricted share units, or other awards. Under the terms of the EIP, a total of ten percent of the number of shares outstanding from time to time, assuming conversion of all super voting shares and MVSs to SVSs are permitted to be issued. The exercise price for incentive stock options issued under the EIP will be set by the compensation committee of the Company’s board of directors but will not be less than 100% of the fair market value of the Company’s shares on the date of grant. Incentive stock options have a maximum term of 10 years from the date of grant. The incentive stock options vest at the discretion of the Company’s board of directors.

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Options granted under the EIP as of September 30, 2025 and 2024 were valued using the Black-Scholes option pricing model with the following weighted average assumptions:

​

​	​	​	​	​	​
​		September 30,	​	September 30,
​		2025		2024
Risk-Free Interest Rate	​	4.53	%	4.49	%
Weighted Average Exercise Price	$	0.49	$	0.54	​
Weighted Average Stock Price	$	0.49	$	0.54	​
Expected Life of Options (years)	​	7.00	​	7.00	​
Expected Annualized Volatility	​	100.00	%	100.00	%
Grant Fair Value	$	0.41	$	0.45	​
Expected Forfeiture Rate	​	N/A		N/A	​
Expected Dividend Yield	​	N/A		N/A	​

​

​

Stock option activity for the nine months ended September 30, 2025, and for the year ended December 31, 2024, is presented below:

​

​	​	​	​	​	​	​	​
​		​		Weighted Average			Weighted Avg.
​	​	Number of Options	​	Exercise Price		​	Remaining Life
Balance, December 31, 2023		29,969,324	​	$	0.50		6.18
Forfeitures		(2,760,530)	​		1.29		—
Exercised		(50,000)	​		0.33		—
Granted		4,073,839	​		0.48		—
Options Outstanding at December 31, 2024		31,232,633	​	$	0.43		5.45
Forfeitures		(2,949,726)	​		0.26		—
Exercised		(508,165)	​		0.18		—
Granted		159,156	​		0.49		—
Options Outstanding at September 30, 2025		27,933,898	​	$	0.45		4.95
​	​	​	​	​	​	​	​
Options Exercisable at September 30, 2025		26,143,795	​	$	0.45		4.71

​

​

During the three and nine-month periods ended September 30, 2025, the Company recognized $121,976 and $480,042, respectively, in stock-based compensation related to stock options. During the three and nine-month periods ended September 30, 2024, the Company recognized $615,215 and $641,196 respectively, in stock-based compensation related to stock options. As of September 30, 2025, the total unrecognized compensation costs related to unvested stock options awards granted was $245,576. In addition, the weighted average period over which the unrecognized compensation expense is expected to be recognized is approximately 1.5 years. The total intrinsic value of stock options outstanding and exercisable as of September 30, 2025, was $8,042,047 and $7,638,552, respectively.

The Company does not estimate forfeiture rates when calculating compensation expense. The Company records forfeitures as they occur.

Warrants

Warrants to purchase SVS entitle the holder to purchase one SVS of the Company.

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A summary of the warrants outstanding is as follows:

​

​	​	​	​	​	​	​	​
​		Number of		Weighted Average			Weighted Average
SVS Warrants	​	Warrants	​	Exercise Price		​	Remaining Life
Warrants outstanding at December 31, 2023		16,400,000	​	$	0.21		4.57
Exercised	​	(480,437)	​	​	0.15	​	—
Warrants outstanding at December 31, 2024	​	15,919,563	​	$	0.22		3.56
Forfeited	​	(150,000)	​	​	1.49	​	—
Exercised	​	(265,626)	​	​	0.145	​	—
Warrants outstanding at September 30, 2025		15,503,937	​	$	0.22		2.82
​	​	​	​	​	​	​	​
Warrants exercisable at September 30, 2025		15,503,937	​	$	0.22		2.82

​

​	​	​	​	​	​	​	​
​		Number of		Weighted Average			Weighted Average
SVS Warrants Denominated in C$	​	Warrants	​	Exercise Price		​	Remaining Life
Warrants outstanding at December 31, 2023 and 2024		3,037,649	​	$	3.50		1.23
Warrants outstanding at September 30, 2025	​	3,037,649	​	$	3.50	​	0.48
​	​	​	​	​	​	​	​
Warrants exercisable at September 30, 2025		3,037,649	​	$	3.50		0.48

​

RSUs

​

The expense associated with RSUs is based on the closing share price of the Company’s subordinate voting shares on the business day immediately preceding the grant date, adjusted for the absence of future dividends and is amortized on a straight-line basis over the periods during which the restrictions lapse. The Company currently has RSUs that vest over a three year period. The awards are generally subject to forfeiture in the event of termination of employment. During the three and nine-months ended September 30, 2025, the Company recognized $3,884,736 and $9,138,150, respectively, in stock-based compensation expense related to RSUs. During the three and nine months periods ended September 30, 2024, the Company recognized $689,704 and $782,944, respectively, in stock-based compensation expense related to RSUs.

​

A summary of RSUs is as follows:

​

​	​	​	​	​	​
​		​		Weighted Avg.
​	​	Number of Shares	​	Fair Value
Balance, December 31, 2023	​	2,543,011	​	$	0.88
Granted	​	9,228,462	​	​	0.31
Forfeitures	​	(443,943)	​	​	1.34
Balance, December 31, 2024	​	11,327,530	​	​	0.40
Granted	​	63,664,614	​	​	0.35
Settled	​	(1,752,453)	​	​	0.94
Forfeitures	​	(66,341)	​	​	1.81
Balance, September 30, 2025	​	73,173,350	​	​	0.35
​	​	​	​	​	​
Vested at September 30, 2025	​	3,212,954	​	$	0.43

​

​

​

16. Commitments and Contingencies

Legal proceedings

Verano

On January 31, 2022, the Company entered into the Arrangement Agreement with Verano, pursuant to which Verano was to acquire all of the issued and outstanding shares of Vireo Growth pursuant to a Plan of Arrangement. Subject to the terms and conditions set forth in the Arrangement Agreement and the Plan of Arrangement, holders of Vireo Growth Shares

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would receive 0.22652 of a Verano Subordinate Voting Share, subject to adjustment as described below, for each Subordinate Voting Share held, and 22.652 Verano Subordinate Voting Shares for each Multiple Voting Share and Super Voting Share held, immediately prior to the effective time of the Arrangement.

On October 13, 2022, Vireo Growth received a notice of purported termination of the Arrangement Agreement (the “Notice”) from Verano. The Notice asserted certain breaches of the Arrangement Agreement, including claims the Company’s public filings and communications with respect to its business and ongoing operations were misleading and that the Company breached its representations to Verano under the Arrangement Agreement. Verano also claimed, as a result of such breaches, it is entitled to payment of a $14,875,000 termination fee and its transaction expenses. Vireo Growth denied all of Verano’s allegations and affirmatively asserted that it complied with its obligations under the Arrangement Agreement, and with its disclosure obligations under US and Canadian law, in all material respects at all times. The Company believes that Verano has no factual or legal basis to justify or support its purported termination of the Arrangement Agreement, which the Company determined to treat as a repudiation of the Arrangement Agreement.

On October 21, 2022, Vireo Growth commenced an action in the Supreme Court of British Columbia against Verano after Verano wrongfully repudiated the Arrangement Agreement. The Company sought damages, costs and interest, based on Verano's breach of contract and of its duty of good faith and honest performance.

On November 14, 2022, Verano filed counterclaims against the Company for the termination fee and transaction expenses described above.

On July 31, 2023, the Company filed a requisition for adjournment of its application filed July 14, 2023, and set for hearing on July 31, 2023, to compel Verano’s compliance with document production based upon the Company’s belief that Verano was engaging in tactics to delay the litigation. 

Throughout 2023, the Company served 4 lists of documents, reviewed document production from Verano, and prepared for examinations for discovery. 

​

On May 2, 2024, the Company filed the Summary Trial Application the Supreme Court of British Columbia for summary determination. The Company sought substantial damages, specifically US $860.9 million, as well as other costs and legal fees, based on Verano’s breach of contract and of its duty of good faith and honest performance.

On June 19, 2024, Verano filed the Preliminary Suitability Application seeking orders dismissing the Summary Trial Application on the basis that certain issues in the action are not suitable for summary determination. The Preliminary Suitability Application is in the process of being scheduled

​

On October 29, 2025, the Company reached a comprehensive settlement (the “Settlement Agreement”) dismissing all outstanding litigation matters between the Company and Verano that are pending before the Supreme Court of British Columbia, Canada. The terms of the Settlement Agreement were approved by the respective Boards of Directors of both Companies.  The value of the settlement to Vireo is approximately $10,000,000 consisting of the acquisition of real property and $1,000,000 in cash.

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Lease commitments

The Company leases various facilities, under non-cancelable finance and operating leases, which expire at various dates through September 2041.

​

​

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17. Selling, General and Administrative Expenses

Selling, general and administrative expenses were comprised of the following items for the three and nine months ended September 30, 2025 and 2024:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended September 30,					​	Nine Months Ended September 30,
​		2025			2024		​	2025			2024
Salaries and benefits	​	$	16,797,222	​	$	3,635,658	​	$	28,304,915	​	$	10,814,786
Professional fees	​		1,290,908	​		1,026,305	​		3,544,080	​		4,324,986
Insurance expenses	​		1,600,280	​		435,789	​		2,276,012	​		1,414,059
Advertising	​	​	607,085	​	​	239,932	​	​	1,216,658	​	​	651,892
Other expenses	​		9,385,293	​		1,573,594	​		14,267,610	​		4,321,399
Total	​	$	29,680,788	​	$	6,911,278	​	$	49,609,275	​	$	21,527,122

​

​

​

18. Other Income (Expense)

The Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) provides an employee retention credit (“CARES Employee Retention Credit”), which is a refundable tax credit against certain employment taxes of up to $5,000 per employee for eligible employers. The CARES Employee Retention Credit was initially equal to 50% of qualified wages paid to employees during a quarter, capped at $10,000 of qualified wages per employee through December 31, 2020. Additional relief provisions were later passed by the United States government, which extended and slightly expanded the qualified wage caps on these credits through December 31, 2021. Based on these additional provisions, the CARES Employee Retention Credit is now equal to 70% of qualified wages paid to employees during a quarter, and the limit on qualified wages per employee has been increased to $10,000 of qualified wages per quarter. The Company applied for and received a CARES Employee Retention Credit equal to $0 and $972,888, respectively, for the three and nine months ended September 30, 2025 and $815,422 for each of the three and nine months ended September 30, 2024. These amounts were recorded in other income on the unaudited condensed consolidated statement of loss and comprehensive loss for the three and nine months ended September 30, 2025 and 2024.

​

On May 25, 2023, the Company and Grown Rogue International, Inc. (“Grown Rogue”) entered into a strategic agreement whereby Grown Rogue will support the Company in the optimization of its cannabis flower products. As part of this strategic agreement Grown Rogue granted the Company 8,500,000 warrants to purchase subordinate voting shares of Grown Rogue on October 5, 2023. Subsequently, on October 9, 2024, the Company and Grown Rogue mutually agreed to terminate the strategic agreement. As part of the termination agreement, the Company forfeited 4,500,000 of the previously granted 8,500,000 warrants. The Company’s remaining 4,000,000 warrants were revalued at a fair value of $1,333,103 and $2,270,964 at September 30, 2025 and December 31, 2024, respectively. The fair value was derived from a Black-Scholes valuation using a stock price of $0.42, an exercise price of $0.162, an expected life of 3.02 years, an annual risk free rate of 3.74%, and volatility of 100%. The three and nine-months ended September 30, 2025 saw a change in fair value of ($60,663) and $937,861, respectively, which was recorded as other expense in the statement of net loss and comprehensive loss for the three and nine month periods ended September 30, 2025.

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19. Segment Reporting

​

The Company utilized the guidance in ASC 280 to determine how many reportable segments the Company has. The Company considered various factors including, but not limited to, the Company’s products and services, production processes, customers, regulatory environment, and business geography, as well as the degree to which the Company’s Chief Operating Decision Maker evaluates the Company’s performance and allocates resources. The Company determined that cannabis is its one and only reportable segment because (a) the Company’s products and services are limited to various forms of cannabis products, (b) the Company’s customers include retail and wholesale customers, (c) the Company’s geography and regulatory environment are the United States, and (d) the Company’s Chief Operating Decision Maker assesses performance and allocates resources at the consolidated level.

​

The Company’s Chief Executive Officer serves as the Company’s Chief Operating Decision Maker. The Company’s Chief Operating Decision Maker assesses performance for the cannabis segment and decides how to allocate resources based on operating profit and net income that also is reported on the statement of net loss and comprehensive loss as consolidated net income. The measure of segment assets is reported on the balance sheet total as consolidated assets. The Company’s Chief Operating Decision Maker uses net income to evaluate income generated from segment assets in deciding the appropriate capital allocation strategy. A comparison of budgeted results to actual results is also used by the Company’s Chief Operating Decision Maker (as defined under U.S. GAAP) to assess business performance.

​

The Company’s cannabis segment cultivates, processes and distributes medical and adult-use cannabis products in a variety of formats, as well as related accessories, in the United States. Revenue is derived from the sale of these products in the United States, and the assets used to produce these products are also held in the United States. The accounting policy for recording revenue, and all other accounting policies, are the same as those described in Note 2 “Summary of Significant Accounting Policies.”

​

20. Supplemental Cash Flow Information⁽¹⁾

​

​	​	​	​	​	​	​
​		September 30,		​	September 30,
​		2025			2024
Cash paid for interest	​	$	21,041,524	​	$	20,355,166
Cash paid for income taxes	​		—	​		—
Change in construction accrued expenses	​		667,700	​		(280,999)
Stock issued in connection with financing activities	​		—	​		5,387,500

(1) For supplemental cash flow information related to leases, refer to Note 9 “Leases.

​

​

​

​

21. Financial Instruments

Credit risk

Credit risk is the risk of loss associated with counterparty’s inability to fulfill its payment obligations. The Company’s credit risk is primarily attributable to cash, and accounts receivable. A small portion of cash is held on hand, from which management believes the risk of loss is remote. Receivables relate primarily to wholesale sales. The Company does not have significant credit risk with respect to customers. The Company’s maximum credit risk exposure is equivalent to the carrying value of these instruments. The Company has been granted licenses pursuant to the laws of the states of Maryland, Minnesota, and New York with respect to cultivating, processing, and/or distributing marijuana. Presently, this industry is illegal under United States federal law. The Company has adhered, and intends to continue to adhere, strictly to the applicable state statutes in its operations.

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Liquidity risk

The Company’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due. As of September 30, 2025, the Company’s financial liabilities consist of accounts payable and accrued liabilities, debt and convertible debt. The Company manages liquidity risk by reviewing its capital requirements on an ongoing basis. Historically, the Company’s main source of funding has been additional funding from investors and debt issuances. The Company’s access to financing is always uncertain. There can be no assurance of continued access to significant equity financing.

Legal Risk

Vireo Growth operates in the United States. The U.S. federal government regulates drugs through the CSA, which places controlled substances, including cannabis, in a schedule. Cannabis is classified as a Schedule I drug. Under U.S. federal law, a Schedule I drug or substance has a high potential for abuse, has no accepted medical use in the U.S., and lacks accepted safety for use under medical supervision. The U.S. Food and Drug Administration has not approved marijuana as a safe and effective drug for any indication. In the U.S., marijuana is largely regulated at the state level. State laws regulating cannabis are in direct conflict with the federal CSA, which makes cannabis use and possession federally illegal.

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign currency rates. Given the Company’s financial transactions are rarely denominated in a foreign currency, there is minimal foreign currency risk exposure.

Interest rate risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company currently carries variable interest-bearing debt subject to fluctuations in the United States Prime rate and Secured Overnight Financing Rate. A change of 100 basis points in interest rates during the three months ended September 30, 2025, would have resulted in a corresponding change in the statement of loss and comprehensive loss of $361,250.

​

​

22. Related Party Transactions

As of each of September 30, 2025 and December 31, 2024, the Company owed $0 to related parties outside of its debt obligations to Chicago Atlantic disclosed in Notes 12 and 13.

In connection with the Proper Mergers and related Proper Merger Agreement, the Company assumed a lease of property in Missouri that is owned by employees of Proper, who are now employees of the Company. During the three and nine months ended September 30, 2025, the Company made lease payments of $45,501 and $60,668, respectively. Monthly rent is $15,167.

​

In connection with the Wholesome Merger and related Wholesome Merger Agreement, the Company assumed a lease of property in Grantsville, Utah that is owned by Wholesome employees, who are now employees of the Company. During the three and nine-month periods ended September 30, 2025, the Company made lease payments totaling $214,191 and $356,985, respectively. Monthly rent is approximately $71,397.

​

In connection with the Deep Roots Merger and related Deep Roots Merger Agreement, the Company assumed an investment in Bluebird Uplifted Development, LLC of $1,000,000. The executive management team of Bluebird Uplifted Development, LLC are employees of Deep Roots and now the Company post-closing of the Deep Roots Merger Agreement.

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In connection with the closing of the Wholesome Merger and the related Wholesome Merger Agreement, the Company acquired $1,000,000 of promissory notes that bore a 13% interest rate due to current employees. The notes were repaid in full on July 7, 2025 in connection with the First Lien Term Loan and Chicago Atlantic Term Loan.

​

Details surrounding the lending relationships between the Company and Chicago Atlantic Admin, are described in Note 12 “Long-Term Debt” and Note 13 “Convertible Debt.”

John Mazarakis, Vireo Growth’s Chief Executive Officer, is a partner of Chicago Atlantic Group, LP, an affiliate of Chicago Atlantic Admin. See "Item 13. Certain Relationships and Related Transactions and Director Independence" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 for more information.

​

23. Subsequent Events

On October 10, 2025, Vireo Health of Colorado, LLC, a Colorado limited liability company and wholly-owned subsidiary of Vireo Growth entered into a restructuring support agreement (the “RSA”) with Medicine Man Technologies, Inc. d/b/a Schwazze, a Nevada corporation (“Schwazze”), certain of Schwazze’s subsidiaries, the beneficial holders (the “Star Bud Holders”) of certain seller notes (the “Star Bud Notes”) secured by a first priority security interest in substantially all the assets owned by SBUD LLC, a wholly owned subsidiary of Schwazze, and certain other parties.

As of October 10, 2025, the Company holds a majority of the outstanding principal amount of Schwazze’s 13% Senior Secured Convertible Notes due December 7, 2026 (the “Senior Secured Notes”). The RSA sets forth a plan to restructure the operations and capital structure of Schwazze and its subsidiaries through a series of transactions, including, but not limited to (i) the purchase of certain assets representing a majority of the total assets of Schwazze and its subsidiaries (the “Asset Sale”) by a newly-formed entity (“NewCo”) to be majority owned by the Company, and (ii) the liquidation of Schwazze’s remaining assets and winding down of Schwazze’s remaining operations (the “Liquidation”).

The RSA provides that the Asset Sale will be effected by way of public disposition of collateral pursuant to §§ 9-610 and 9-611 of the Uniform Commercial Code to be conducted by the collateral agent for the Senior Secured Notes. The collateral agent under the indenture (the “Indenture”) governing the Senior Secured Notes, acting at the direction of the Company, will credit bid at the Asset Sale a principal amount of Senior Secured Notes to be determined by the Company (the “Credit Bid”). However, the Asset Sale will be open to other bidders and is therefore subject to competing bids which may be higher than the Credit Bid. If the Credit Bid is the winning bid at the Asset Sale, Schwazze will enter into an asset purchase agreement with NewCo pursuant to which, subject to receipt of regulatory approvals and other closing conditions, the assets subject to the Asset Sale will be transferred to NewCo in consideration for an assumption by NewCo of certain specified liabilities of Schwazze and a discharge of the Senior Secured Notes included in the Credit Bid.   In connection with the Liquidation, which will follow the Asset Sale, any available net cash proceeds in excess of amounts needed to cover costs of the Asset Sale and Liquidation will be distributed to holders of claims and equity interests in Schwazze in accordance with their relative priority under applicable law, whereby excess proceeds (if any) would be paid,  first, to secured claims (including any portion of the Senior Secured Notes not included in the Credit Bid), second to unsecured claims, third, to preferred stockholders of Schwazze, and, fourth, to common stockholders of Schwazze. Pursuant to the RSA, certain parties have agreed to provide NewCo with up to approximately $62 million in financing, a portion of which will be used to refinance the Star Bud Holders in full and final satisfaction of their claims with respect to the Star Bud Notes. As a result of the Asset Sale and the Liquidation, (i) all obligations represented by the Senior Secured Notes and the Star Bud Notes will be extinguished and (ii) NewCo will become an indirect majority owned subsidiary of the Company.

​

Vireo Growth has been involved in an action pending in the Supreme Court of British Columbia against Verano following Verano’s repudiation of the Arrangement Agreement with the Company dated January 31, 2022. In the litigation, the Company sought damages, costs and interest, based on Verano's breach of contract and breach of its duty of good faith and honest performance.

​

On October 29, 2025, the parties reached the Settlement Agreement dismissing all outstanding litigation matters between the two companies that were pending before the Supreme Court of British Columbia.

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​

The terms of the Settlement Agreement were approved by the respective Boards of Directors of both companies. The value of the settlement to Vireo Growth is approximately $10,000,000 consisting of the acquisition of certain real estate assets and $1,000,000 in cash.  See Note 16. Commitments and Contingencies for more information.

​

,

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with the financial information and the notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q. References to “we,” “our,” “us,” the “Company,” and “Vireo Growth” refer to Vireo Growth, Inc. together with its subsidiaries unless the context otherwise requires. Amounts are presented in United States dollars, except as otherwise indicated.

Forward-Looking Statements

Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our outlook, plans and strategy for our business and potential financing, includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or “forward-looking information” within the meaning of Canadian securities laws. These statements are often identified by the use of words such as “anticipate,” “believe,” “continue,” “remain,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “will,” “would,” “should,” “potential,” “intention,” “strategy,” “strategic,” “approach,” “subject to,” “possible,” “pending,” “if,” or the negative or plural of these words or similar expressions or variations. Such forward-looking statements and forward-looking information are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements or forward-looking information. Factors that could cause or contribute to such differences include, but are not limited to, those identified in this Quarterly Report on Form 10-Q and those discussed in the section titled “Risk Factors” set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024, as amended, and in our other SEC and Canadian public filings. Such forward-looking statements reflect our beliefs and opinions on the relevant subject based on information available to us as of the date of this report, and while we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements. You should not rely upon forward-looking statements or forward-looking information as predictions of future events. Furthermore, such forward-looking statements or forward-looking information speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements or forward-looking information to reflect events or circumstances after the date of such statements.

Overview of the Company

Vireo Growth was founded in 2014 as a medical cannabis company and has since developed a disciplined, strategically aligned platform within the cannabis industry. The Company’s mission is to provide safe access, quality products, and value to its customers. Vireo Growth operates cultivation, production, and dispensary facilities in Maryland, Minnesota, Missouri, Nevada, New York, and Utah. The Company allocates capital and talent to areas expected to generate long-term value and operates with a commitment to accountability, efficiency, and its stakeholders, including customers, employees, shareholders, and the communities it serves.

​

Operating Segment

We report our operating results in one business segment: the cultivation, production, and sale of cannabis. We cultivate, manufacture, and distribute cannabis products to third parties in wholesale markets and cultivate, manufacture, and sell cannabis products directly to approved patients and adult-use-customers in our owned or operated retail stores.

During the three and nine months ended September 30, 2025, the Company had operating revenue in six states: Maryland, Minnesota, New York, Missouri, Nevada, and Utah. Retail revenues during the three and nine months ended September

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30, 2025 were derived from sales in 36 dispensaries throughout these six states. We had eight operational dispensaries in Minnesota, four in New York, two in Maryland, eleven in Missouri, ten in Nevada, and one in Utah.

Merger Agreements with Deep Roots, Proper and Wholesome

​

On December 18, 2024, we entered into merger agreements (each a “Merger Agreement” and collectively, the “Merger Agreements”) with each of (i) Deep Roots Holdings, Inc. (“Deep Roots”) (the “Deep Roots Merger”), (ii) Proper Holdings, LLC (“Proper”), NGH Investments, Inc. (“NGH”), and Proper Holdings Management, Inc. (“Proper MSA Newco” and together with NGH and Proper, the “Proper Companies”) (the “Proper Mergers”), and (iii) WholesomeCo, Inc. (“Wholesome”) (the “Wholesome Merger” and collectively with the Deep Roots Merger and the Proper Mergers, the “Mergers” and each, a “Merger”). Each Merger was an all-share transaction whereby, at the closing of each Merger, (i) a new wholly-owned subsidiary of the Company merged with and into Deep Roots, (ii) a new wholly-owned subsidiary of the Company merged with and into Wholesome, and (ii) the Proper Companies each merged with and into new wholly-owned subsidiaries of the Company. None of the Mergers were contingent upon the completion of any of the other Mergers.  

​

During the nine months ended September 30, 2025, all of the Mergers closed. More specifically, the Wholesome Merger closed on May 12, 2025, the Proper Mergers closed on June 5, 2025, and the Deep Roots Merger closed on June 6, 2025.

​

Three months ended September 30, 2025, Compared to Three months ended September 30, 2024

Revenue

We derived our revenue from cultivating, processing, and distributing cannabis products through our 36 dispensaries in six states and our wholesale sales to third parties in six states. For the three months ended September 30, 2025, 83% of our revenue was generated from retail dispensaries and 17% from the wholesale business. For the three months ended September 30, 2024, 78% of our revenue was generated from retail business and 22% from wholesale business.

For the three months ended September 30, 2025, Minnesota operations contributed approximately 13% of revenues, New York contributed 7%, Maryland contributed 11%, Utah contributed 15%, Nevada contributed 27%, and Missouri contributed 27%. For the three months ended September 30, 2024, Minnesota operations contributed approximately 46% of revenues, New York contributed 11%, and Maryland contributed 43%.

Revenue for the three months ended September 30, 2025, was $91,655,155, an increase of $66,489,812 or 264% compared to revenue of $25,165,343 for the three-months ended September 30, 2024. The increase was primarily attributable to the closing of the Mergers resulting in the addition revenues from our operations in Utah, Nevada, and Missouri.

Retail revenue for the three months ended September 30 2025, was $75,951,983 an increase of $56,211,196 or 285% compared to retail revenue of $19,740,787 for the three months ended September 30, 2024. This increase was primarily due to the closing of the Mergers and the related Merger Agreements, resulting in the addition of revenues from our operations in Utah, Nevada, and Missouri.

Wholesale revenue for the three months ended September 30, 2025, was $15,703,172, an increase of $10,278,616 compared to wholesale revenue of $5,424,556 for the three months ended September 30, 2024. The increase was primarily

34

Table of Contents

due to increased contributions from New York, and the closing of the Mergers and the related Merger Agreements, resulting in the addition of revenues from our operations in Utah, Nevada, and Missouri.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three Months Ended

​

​

​

​

​

​

​

September 30,

​

​

​

​

​

​

2025

2024

$ Change

% Change

Retail:

​

​

​

​

​

MN

​

$

11,954,050

​

$

11,391,969

​

$

562,081

5

%

NY

​

985,914

​

1,428,827

​

(442,913)

(31)

%

MD

​

​

6,620,115

​

​

6,919,991

​

​

(299,876)

(4)

%

UT

​

​

11,476,957

​

​

—

​

​

11,476,957

​

100

%

NV

​

​

24,946,810

​

​

—

​

​

24,946,810

​

100

%

MO

​

​

19,968,137

​

​

—

​

​

19,968,137

​

100

%

Total Retail

​

$

75,951,983

​

$

19,740,787

​

$

56,211,196

285

%

​

​

​

​

​

​

​

​

​

​

​

​

​

Wholesale:

​

​

​

​

MN

​

$

66,812

​

146,461

​

(79,649)

(54)

%

NY

​

5,117,153

​

1,321,224

​

3,795,929

287

%

MD

​

3,749,186

​

3,956,871

​

(207,685)

(5)

%

UT

​

​

1,856,967

​

​

—

​

​

1,856,967

​

100

%

NV

​

​

24,244

​

​

—

​

24,244

​

100

%

MO

​

​

4,888,810

​

​

—

​

​

4,888,810

​

100

%

Total Wholesale

​

$

15,703,172

​

$

5,424,556

​

$

10,278,616

189

%

​

​

​

​

​

​

​

​

​

​

​

​

​

Total Revenue

​

$

91,655,155

​

$

25,165,343

​

$

66,489,812

264

%

​

​

Cost of Sales and Gross Profit

Gross profit reflects total net revenue less cost of sales. Cost of sales represents the costs attributable to producing bulk materials and finished goods, which includes direct materials, labor, and certain indirect costs such as depreciation, insurance, utilities and valuation adjustments. Cannabis costs are affected by various state regulations that limit the sourcing and procurement of cannabis product, which may create fluctuations in gross profit over comparative periods as the regulatory environment changes.

Cost of sales are determined from costs related to the cultivation and processing of cannabis and cannabis-derived products as well as the cost of finished goods inventory purchased from third parties and valuation adjustments.

Cost of sales for the three months ended September 30, 2025, was $54,272,156, an increase of $41,430,783 compared to the three months ended September 30, 2024, of $12,841,373. The increase in cost of sales was driven by the increase in revenues.

Gross profit for the three months ended September 30, 2025, was $37,382,999, representing a gross margin of 41%. In comparison, gross profit for the three months ended September 30, 2024, was $12,323,970 or a 49% gross margin. The increase in gross profit was driven by the closing of the Mergers, which added the gross profit of Deep Roots, Proper, and Wholesome. The decrease in gross margin is primarily attributable to the amortization of the non-cash inventory fair value step initially recognized in connection with the closing of the Mergers. Excluding this amortization of $12,397,641 from the gross profit figure of $37,382,999 would have resulted in gross profit of $49,780,640 and gross margin of approximately 54% for the three months ended September 30, 2025.

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Table of Contents

Total Expenses

Total expenses other than the cost of sales consist of selling costs to support customer relationships, marketing, and branding activities. They also include a significant investment in the corporate infrastructure required to support ongoing business.

Selling costs generally correlate to revenue. In the short-term as a percentage of sales, we expect selling costs to remain relatively flat.  However, as anticipated positive regulatory developments in our core markets occur, we expect selling costs as a percentage of sales to decrease via growth in our retail and wholesale channels.

General and administrative expenses also include costs incurred at the corporate offices, primarily related to personnel costs, including salaries, benefits, and other professional service costs, as well as corporate insurance, legal and professional fees associated with being a publicly traded company. We expect general and administrative expenses as a percentage of sales to decrease as we realize revenue growth both organically and through anticipated positive regulatory developments in our core markets.

Total expenses for the three months ended September 30, 2025, were $36,574,043 an increase of $28,101,520 compared to total expenses of $8,472,523 for the three months ended September 30, 2024. The increase in total expenses was primarily attributable to an increase in transaction expenses associated with the Mergers, an increase in stock-based compensation expense, and the addition of the operating expenses of Deep Roots, Proper, and Wholesome.

Operating Income before Other Income (Expense) and Income Taxes

Operating income before other income (expense) and provision for income taxes for the three months ended September 30, 2025, was $808,956 a decrease of $3,042,491 compared to $3,851,447 for the three months ended September 30, 2024.

Total Other Expense

Total other expense for the three months ended September 30, 2025, was $13,760,817, an increase of $7,368,012 compared to total other expense of $6,392,805 for the three months ended September 30, 2024. This change was primarily attributable to the loss on extinguishment of existing debt of $8,627,647, which was recorded in connection with the First Lien Term Loan and Chicago Atlantic Term Loan.

Provision for Income Taxes

Income tax expense is recognized based on the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year-end. For the three months ended September 30, 2025, tax expense totaled $13,347,000 compared to tax expense of $2,385,000 for the three months ended September 30, 2024. The increase in tax expense was driven by the increase in gross profit relative to the prior year.

​

Nine months ended September 30, 2025, compared to nine months ended September 30, 2024

Revenue

We derived our revenue from cultivating, processing, and distributing cannabis products through our 36 dispensaries in six states and our wholesale sales to third parties in six states. For the nine months ended September 30, 2025, 80% of our revenue was generated from retail dispensaries and 20% from the wholesale business. For the nine months ended September 30, 2024, 81% of our revenue was generated from retail business and 19% from wholesale business.

For the nine months ended September 30, 2025, Minnesota operations contributed approximately 21% of revenues, New York contributed 8%, Maryland contributed 20%, Utah contributed 13%, Nevada contributed 19%, and Missouri contributed 20%. For the nine months ended September 30, 2024, Minnesota operations contributed approximately 48% of revenues, New York contributed 11%, and Maryland contributed 41%.

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Table of Contents

Revenue for the nine months ended September 30, 2025, was $164,258,806, an increase of $89,897,901 or 121% compared to revenue of $74,360,905 for the nine-months ended September 30, 2024. The increase was primarily attributable to the closing of the Mergers, resulting in the addition of revenues from our operations in Utah, Nevada, and Missouri.

Retail revenue for the nine months ended September 30 2025, was $131,958,184 an increase of $71,798,938 or 119% compared to retail revenue of $60,159,246 for the nine months ended September 30, 2024. This increase was primarily due to the closing of the Mergers, resulting in the addition of retail revenue from our operations in Utah, Nevada, and Missouri.

Wholesale revenue for the nine months ended September 30, 2025, was $32,300,622, an increase of $18,098,963 compared to wholesale revenue of $14,201,659 for the nine months ended September 30, 2024. This increase was primarily due to increased contributions from New York, and the closing of the Mergers, resulting in the addition of wholesale revenue from our operations in Utah, Nevada, and Missouri.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Nine Months Ended

​

​

​

​

​

​

​

September 30,

​

​

​

​

​

​

2025

2024

$ Change

% Change

Retail:

​

​

​

​

​

MN

​

$

34,021,309

​

$

34,608,015

​

$

(586,706)

(2)

%

NY

​

3,285,510

​

4,854,423

​

(1,568,913)

(32)

%

MD

​

​

20,189,092

​

​

20,696,808

​

​

(507,716)

​

(2)

%

UT

​

​

17,578,578

​

​

—

​

​

17,578,578

​

100

%

NV

​

​

31,308,095

​

​

—

​

​

31,308,095

​

100

%

MO

​

​

25,575,600

​

​

—

​

​

25,575,600

​

100

%

Total Retail

​

$

131,958,184

​

$

60,159,246

​

$

71,798,938

119

%

​

​

​

​

​

​

​

​

​

​

​

​

​

Wholesale:

​

​

​

​

MN

​

​

507,936

​

​

153,330

​

​

354,606

231

%

NY

​

10,181,207

​

3,454,162

​

6,727,045

195

%

MD

​

​

12,021,131

​

​

10,594,167

​

​

1,426,964

​

13

%

UT

​

​

2,963,723

​

​

—

​

​

2,963,723

​

100

%

NV

​

​

52,450

​

​

—

​

​

52,450

​

100

%

MO

​

​

6,574,175

​

​

—

​

​

6,574,175

​

100

%

Total Wholesale

​

$

32,300,622

​

$

14,201,659

​

$

18,098,963

127

%

​

​

​

​

​

​

​

​

​

​

​

​

​

Total Revenue

​

$

164,258,806

​

$

74,360,905

​

$

89,897,901

121

%

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Cost of Sales and Gross Profit

Gross profit reflects total net revenue less cost of sales. Cost of sales represents the costs attributable to producing bulk materials and finished goods, which includes direct materials, labor, and certain indirect costs such as depreciation, insurance, utilities and valuation adjustments. Cannabis costs are affected by various state regulations that limit the sourcing and procurement of cannabis product, which may create fluctuations in gross profit over comparative periods as the regulatory environment changes.

Cost of sales are determined from costs related to the cultivation and processing of cannabis and cannabis-derived products as well as the cost of finished goods inventory purchased from third parties and valuation adjustments.

Cost of sales for the nine months ended September 30, 2025, was $94,045,648, an increase of $57,803,783 compared to the nine months ended September 30, 2024, of $36,241,865. The increase in cost of sales was driven by the increase in revenues.

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Table of Contents

Gross profit for the nine months ended September 30, 2025, was $70,213,158, representing a gross margin of 43%. This is compared to gross profit for the nine months ended September 30, 2024, of $38,119,040 or a 51% gross margin. The increase in gross profit was driven by the closing of the Mergers, which added the gross profit of Deep Roots, Proper, and Wholesome. The decrease in gross margin was primarily attributable to the amortization of the non-cash inventory fair value step initially recognized in connection with the closing of the Mergers. Excluding this amortization of $16,549,749 from the gross profit figure of $70,213,158 would have resulted in gross profit of $86,762,907 and gross margin of approximately 53% for the nine months ended September 30, 2025.

Total Expenses

Total expenses other than the cost of sales consist of selling costs to support customer relationships, marketing, and branding activities. It also includes a significant investment in the corporate infrastructure required to support ongoing business.

Selling costs generally correlate to revenue. In the short-term as a percentage of sales, we expect selling costs to remain relatively flat.  However, as anticipated positive regulatory developments in our core markets occur, we expect selling costs as a percentage of sales to decrease via growth in our retail and wholesale channels.

General and administrative expenses also include costs incurred at the corporate offices, primarily related to personnel costs, including salaries, benefits, and other professional service costs, as well as corporate insurance, legal and professional fees associated with being a publicly traded company. We expect general and administrative expenses as a percentage of sales to decrease as we realize revenue growth organically and through anticipated positive regulatory developments in our core markets.

Total expenses for the nine months ended September 30, 2025, were $69,447,203, an increase of $45,733,077 compared to total expenses of $23,714,126 for the nine months ended September 30, 2024. The increase in total expenses was primarily attributable to an increase in transaction expenses associated with the Mergers, an increase in stock-based compensation expense, and the addition of the operating expenses of Deep Roots, Proper, and Wholesome given the Mergers closed during the nine months ended September 30, 2025.

Operating Income before Other Income (Expense) and Income Taxes

Operating income before other income (expense) and provision for income taxes for the nine months ended September 30, 2025, was $765,955 a decrease of $13,638,959 compared to $14,404,914 for the nine months ended September 30, 2024.

Total Other Expense

Total other expense for the nine months ended September 30, 2025, was $28,631,635, an increase of $8,690,493 compared to other expense of $19,941,142 for the nine months ended September 30, 2024. This change was primarily attributable to the loss on extinguishment of existing debt of $8,627,647, which was recorded in connection with the First Lien Term Loan and Chicago Atlantic Term Loan.

Provision for Income Taxes

Income tax expense is recognized based on the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year-end. For the nine months ended September 30, 2025, tax expense totaled $19,876,000 compared to tax expense of $6,770,000 for the nine months ended September 30, 2024. The increase in tax expense was driven by the increase in gross profit.

​

NON-GAAP MEASURES

Earnings before interest, taxes, depreciation and amortization (“EBITDA”) and Adjusted EBITDA are non-GAAP measures that do not have standardized definitions under the United States generally accepted accounting principles (“GAAP”). Total revenues, excluding revenues from states where we have divested operations, is also a non-GAAP

38

Table of Contents

measure that does not have a standardized definition under GAAP. The following information provides reconciliations of the supplemental non-GAAP financial measures EBITDA and Adjusted EBITDA presented herein to the most directly comparable financial measures calculated and presented in accordance with GAAP.  Reconciliations of the supplemental non-GAAP financial measure, total revenues, that exclude revenues from states where we have divested operations presented herein to the most directly comparable financial measures calculated in accordance with GAAP can be found in the tables above where the measure appears. We have provided these non-GAAP financial measures, which are not calculated or presented in accordance with GAAP, as supplemental information and in addition to the financial measures that are calculated and presented in accordance with GAAP. These supplemental non-GAAP financial measures are presented because management has evaluated the financial results both including and excluding the adjusted items and believes that the supplemental non-GAAP financial measures presented provide additional perspective and insights when analyzing the core operating performance of the business. The supplemental non-GAAP financial measures should not be considered superior to, as a substitute for, or as an alternative to, and should be considered in conjunction with, the GAAP financial measures presented.

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three Months Ended

​

Nine Months Ended

​

​

September 30,

​

September 30,

​

2025

2024

​

2025

2024

Net income (loss)

​

$

(26,298,861)

​

$

(4,926,358)

​

$

(47,741,680)

​

$

(12,306,228)

Interest expense, net

​

6,906,226

​

7,363,655

​

22,153,565

​

23,604,746

Income taxes

​

13,347,000

​

2,385,000

​

19,876,000

​

6,770,000

Depreciation & Amortization

​

2,082,819

​

256,326

​

3,441,872

​

762,864

Depreciation and amortization included in cost of sales

​

1,813,459

​

582,072

​

3,242,131

​

1,752,770

EBITDA (non-GAAP)

​

$

(2,149,357)

​

$

5,660,695

​

$

971,888

​

$

20,584,152

Non-cash inventory adjustments

​

13,394,126

​

393,000

​

17,753,085

​

130,000

Grown Rogue termination fee included in cost of goods sold

​

​

—

​

​

—

​

​

533,333

​

​

—

Stock-based compensation

​

4,006,712

​

1,304,919

​

9,618,192

​

1,424,140

Transaction related expenses

​

​

803,724

​

​

—

​

​

6,777,864

​

​

—

Other income

​

(479,245)

​

(970,850)

​

(861,610)

​

(3,881,931)

Debt financing costs

​

​

1,873,589

​

​

—

​

​

1,873,589

​

​

—

Severance expense

​

​

74,320

​

​

—

​

​

694,159

​

​

—

Loss on disposal of assets

​

7,837,671

​

—

​

7,843,515

​

218,327

Adjusted EBITDA (non-GAAP)

​

$

25,361,541

​

$

6,387,764

​

$

45,204,016

​

$

18,474,688

​

Liquidity, Financing Activities During the Period, and Capital Resources

We are an early-stage growth company. We are generating cash from sales and deploying our capital reserves to acquire and develop assets capable of producing additional revenues and earnings over both the immediate and near term. Capital reserves are for capital expenditures and improvements in existing facilities, product development and marketing, customer, supplier, investor, industry relations, and working capital.

Current management forecasts and related assumptions support the view that we can adequately manage the operational needs of the business.

Long-Term Debt Arising from the Mergers

​

In connection with the closing of the Proper Mergers, the Company became obligated under $25,502,655 of notes payable due to Chicago Atlantic Admin, LLC. The unpaid principal amounts outstanding bore interest at a rate of (a) 11%, payable monthly in cash, and (b) 3.00% per annum PIK interest, payable monthly. In addition, 1% amortization of the original principal value of the note, or $27,100,000, was payable monthly, and the note was set to mature on November 28, 2025. See Note 3 “Business Combinations and Dispositions” for additional information.

​

39

Table of Contents

In connection with the closing of the Deep Roots Merger, the Company became obligated under $19,166,670 of notes payable due to Chicago Atlantic Admin, LLC. The unpaid principal amounts outstanding bore interest at a rate of (a) the U.S. prime rate, with a floor of 8.00%, plus (b) 6.50%, payable monthly in cash. In addition, 0.83% amortization of the original principal value of the note, or $20,000,000, was payable monthly, and the note was set to mature on August 15, 2027. See Note 3 “Business Combinations and Dispositions” for additional information.

​

In connection with the closing of the Wholesome Merger, the Company became obligated on a $8,766,340 term loan bearing an interest rate of 11.25%, payable monthly in cash. The term loan was repaid in full on May 13, 2025. Additionally, the Company became obligated on $1,000,000 of promissory notes bearing an interest rate of 13.00%, payable monthly cash. See Note 3 “Business Combinations and Dispositions” for additional information.

​

First Lien Term Loan and Chicago Atlantic Term Loan

​

On July 7, 2025, the Company entered into a Loan and Security Agreement (the “First Lien Term Loan”), effective July 3, 2025, with East West Bank, a California banking corporation (“East West Bank”), as Administrative Agent (the “Administrative Agent”), and Western Alliance Bank, an Arizona corporation, as co-administrative agent (the “Co-Admin Agent”).

​

The First Lien Term Loan provides for an aggregate principal amount of $120,000,000. The aggregate principal amount of the First Lien Term Loan amortizes in quarterly installments of $3,000,000. The Company will make such quarterly amortization payments commencing on December 31, 2025 and on the last business day of each quarter thereafter through and including June 30, 2028. Upon maturity of the First Lien Term Loan on July 31, 2028, the remaining outstanding principal amount of the First Lien Term Loan, and all accrued and unpaid interest thereon, will be due and payable in full. The First Lien Term Loan bears interest at the one-month Term Secured Overnight Financing Rate (subject to a 3% floor) plus 4% per annum. The First Lien Term Loan shall, at the Administrative Agent’s option, convert to a Prime Rate Loan at the end of the First Lien Term Loan’s current one-month interest period if an event of default shall occur and be continuing, at which time an additional 2% of default interest will also be applicable to the First Lien Term Loan.

​

On July 7, 2025, the Company entered into a secured term loan (the “Chicago Atlantic Term Loan”), effective July 3, 2025, with Chicago Atlantic Opportunity Finance, LLC, as a Lender, Chicago Atlantic Admin, LLC, as Administrative Agent and Collateral Agent (“2L Agent”) and Chicago Atlantic Credit Advisers, LLC, as Lead Arranger (“Lead Arranger”).

The Chicago Atlantic Term Loan provides for a principal amount of $33,000,000 to be loaned to the Company along with a $50,000,000 accordion feature, available to support future strategic initiatives, subject to the sole discretion of the Lender and 2L Agent. Amortization payments are due and payable monthly on each payment date in an amount equal to 1% of the loan amount starting November 30, 2025. All unpaid and accrued interest is due and payable on the maturity date of October 2, 2028, with an option to extend for an additional year subject to a 1% extension fee of all loans advanced by lenders under the Chicago Atlantic Term Loan. The Chicago Atlantic Term Loan bears interest at the Prime Rate (subject to a 7.5% floor) plus 5.5% per annum.

​

The First Lien Term Loan is secured by a perfected first priority security interest in all assets and future assets of the Company. The Chicago Atlantic Term Loan is secured by a second priority security interest in and lien on all existing assets and future assets of the Company.

​

The proceeds from the First Lien Term Loan and Chicago Atlantic Term Loan were used to retire all of the Company’s existing debt obligations, including the debt arising from acquisitions, including the Mergers. In connection with the retirement of the existing debt, the Company recorded a loss on extinguishment of $8,627,647, which is included in other expense on the statement of loss and comprehensive loss for the three and nine months ended September 30, 2025.

​

Unless otherwise specified, all deferred financing costs are treated as a contra-liability, to be netted against the outstanding loan balance and amortized over the remaining life of the loan. As of September 30, 2025, and December 31, 2024, $5,704,695 and $6,576,985 of deferred financing costs remained unamortized, respectively.

​

40

Table of Contents

Convertible Notes

​

On July 31, 2024, holders voluntarily converted convertible notes issued in 2023 into 73,016,061 Subordinate Voting Shares of the Company.

​

On November 1, 2024, the Company entered into the Joinder and Tenth Amendment to the Credit Agreement (the “Tenth Amendment”). The Tenth Amendment provides a convertible note facility (the “Convertible Notes”) with a maximum principal amount of $10,000,000. The Convertible Notes mature on November 1, 2027, have a cash interest rate of 12.0%  per year, and are convertible into the Company’s SVSs at an amount determined by dividing the outstanding principal amount, plus all accrued but unpaid interest on the Convertible Notes on the date of such conversion, by a conversion price of $0.625. The Company incurred $145,717 in financing costs in connection with the signing of the Tenth Amendment.

​

On July 7, 2025, the Company retired the Convertible Notes, and issued a $10 million convertible note (the “New Convertible Notes”) to Chicago Atlantic Opportunity Finance, LLC, also with a second priority interest, that matures on October 2, 2028 with an option to extend for an additional year subject to a 1% extension fee of all Chicago Atlantic loans advanced, has a cash interest rate of Prime Rate (subject to a 7.5% floor) plus 5.0% per year, and is convertible into that number of the Company’s subordinate voting shares determined by dividing the outstanding principal amount plus all accrued but unpaid interest on the convertible notes on the date of such conversion by a conversion price of $0.625.

​

All deferred financing costs are treated as a contra-liability, to be netted against the outstanding loan balance and amortized over the remaining life of the loan. As of September 30, 2025 and December 31, 2024, $103,891 and $137,622 of deferred financing costs remained unamortized, respectively.

​

Cash Used in Operating Activities

Net cash used in operating activities was $14.9 million for the nine months ended September 30, 2025, an increase of $11.1 million as compared to $3.8 million for the nine months ended September 30, 2024. The increase was primarily attributed to an increase in assets held for sale, payment of approximately $14 million of accrued expenses assumed in the Mergers including distributions to former stockholders of Deep Roots, Proper, and Wholesome, and increased transaction costs associated with the Mergers, and approximately $3.7 million of cash debt extinguishment costs.

Cash Used in Investing Activities

Net cash provided by investing activities was $18.2 million for the nine months ended September 30, 2025, an increase of $23.7 million compared to net cash used in investing activities of $5.5 million for the nine months ended September 30, 2024. The increase was primarily attributable to the cash acquired through the closing of the Mergers during the nine-months ended September 30, 2025, partially offset by increased purchases of property, plant, and equipment.

Cash Used in Financing Activities

Net cash provided by financing activities was $22.7 million for the nine months ended September 30, 2025, a change of $22.1 million as compared to $0.6 million provided by financing activities in the nine months ended September 30, 2024. The change was principally due to the receipt of proceeds from the First Lien Term Loan and Chicago Atlantic Term Loan.

Lease Transactions

As of September 30, 2025, we are party to lease agreements for the use of buildings used in the cultivation, production and/or sales of cannabis products in Maryland, Minnesota, New York, Missouri, Nevada, and Utah.

​

The lease agreements for all of the retail spaces used for our dispensary operations are with third-party landlords and the remaining durations range from one to ten years. These agreements are short-term facility leases that require us to make monthly rent payments and fund common area costs, utilities and maintenance. In some cases, we have received tenant

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improvement funds to assist in the buildout of the spaces to meet our operating needs. As of September 30, 2025, we operated 36 retail locations secured under these agreements.

We also entered into sale and leaseback arrangements for our cultivation and processing facilities in Minnesota and New York with a special-purpose real estate investment trust. These leases are long-term agreements that provide, among other things, funds to make certain improvements to the properties that will significantly enhance the production capacity and operational efficiency of the facilities.

Excluding any contracts under one year in duration, the future minimum lease payments (principal and interest) on all our leases are as follows:

​

​	​	​	​	​	​	​	​	​	​
​	​	Operating Leases		​	Finance Leases		​	​	​
​		September 30, 2025			September 30, 2025			Total
2025	​	$	2,266,352	​	$	3,505,294	​	$	5,771,646
2026	​		9,052,432	​		14,183,661	​		23,236,093
2027	​		8,364,994	​		14,606,527	​		22,971,521
2028	​		7,825,020	​		15,042,128	​		22,867,148
2029	​		7,123,834	​		15,490,852	​		22,614,686
Thereafter	​		23,650,636	​		203,082,066	​		226,732,702
Total minimum lease payments	​	$	58,283,268	​	$	265,910,528	​	$	324,193,796
Less discount to net present value	​	​	(16,901,174)	​		(171,368,934)	​		(188,270,108)
Less liabilities held for sale	​	​	(2,481,882)	​	​	(86,897,778)	​	​	(89,379,660)
Present value of lease liability	​	$	38,900,212	​	$	7,643,816	​	$	46,544,028

​

ADDITIONAL INFORMATION

Outstanding Share Data

As of November 11, 2025, we had 1,064,669,823 shares issued and outstanding on an as converted basis, consisting of the following:

(a)  Subordinate Voting Shares

1,038,706,623 Subordinate Voting Shares  issued and outstanding. The holders of Subordinate Voting Shares are entitled to one vote per share at all shareholder meetings. The Company is authorized to issue an unlimited number of no-par value Subordinate Voting Shares.

(b)  Multiple Voting Shares

259,634 Multiple Voting Shares  issued and outstanding. The holders of Multiple Voting Shares are entitled to one hundred votes per share at all shareholder meetings. Each Multiple Voting Share is exchangeable for one hundred subordinate voting shares. The Company is authorized to issue an unlimited number of Multiple Voting Shares.

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Options, RSUs, and Warrants

As of September 30, 2025, we had 27,933,898 employee stock options outstanding, 73,173,350 RSUs outstanding, 3,037,649 Subordinate Voting Share compensation warrants denominated in C$ related to financing activities, and 15,503,937 Subordinate Voting Share compensation warrants outstanding.

Off-Balance Sheet Arrangements

As of the date of this filing, we do not have any off-balance-sheet arrangements that have, or are reasonably likely to have, a current or future effect on our results of operations or financial condition, including, and without limitation, such considerations as liquidity and capital resources.

Critical Accounting Policies and Estimates

There have been no material changes to our critical accounting policies and estimates from the information provided in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included in our Annual Report on Form 10-K for the year ended December 31, 2024, as amended.

​

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Quantitative and qualitative disclosures about market risk have been omitted as permitted under rules applicable to smaller reporting companies.

​

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the appropriate time periods, and that such information is accumulated and communicated to the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely discussions regarding required disclosure. We, under the supervision of and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2025, and, based on that evaluation, have concluded that the design and operation of our disclosure controls and procedures were effective as of such date.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended September 30, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings

We are involved in various regulatory issues, claims and lawsuits arising in the ordinary course of business, none of which, in the opinion of management, is expected to have a material, adverse effect on our results of operations or financial condition. The information contained in Part I, Item 1. Financial Statement and Supplementary Date - Note 16, "Commitments and Contingencies," under the heading "Legal Proceedings," is incorporated by reference into this Item 1.

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Item 1A. Risk Factors

Risks Related to the RSA, Credit Bid and Asset Sale

​

There can be no assurance that the Company’s Credit Bid will be the winning bid in the Asset Sale.

​

The RSA between the Company and Schwazze sets forth a plan to restructure the operations and capital structure of Schwazze and its subsidiaries through a serious of transactions including the Asset Sale, which will be effected by way of a UCC public disposition of collateral. The Company intends to credit bid at the Asset Sale; however, given that the Asset Sale is open to other bidders and competing bids, the Company’s Credit Bid may not be the winning bid, which would frustrate the aims of the RSA and prevent the Company from acquiring the assets of Schwazze that are the subject of the Asset Sale, which could have a material adverse effect on the Company.

​

There can be no assurance that all of the conditions precedent to closing of the Asset Sale will be satisfied.

​

If the Company’s Credit Bid is successful, the completion of the Asset Sale will be subject to a number of conditions precedent, some of which are outside of our control. There can be no certainty, nor can we provide any assurance, that all conditions precedent to the Asset Sale will be satisfied or waived, or, if satisfied or waived, when they will be satisfied or waived and, accordingly, the Asset Sale may not be timely completed or completed at all. If the Asset Sale is not completed, the market price of our Shares may be adversely affected.

​

The required regulatory approvals may not be obtained or, if obtained, may not be obtained on a favorable basis.

​

To complete the acquisition of the Schwazze assets in the Asset Sale, the Company and Schwazze must make certain filings with and obtain certain consents and approvals from various governmental and regulatory authorities. The required regulatory approvals have not been obtained yet. The regulatory approval processes may take a lengthy period of time to complete, which could delay completion of the Asset Sale. If obtained, the required regulatory approvals may be conditioned, with the conditions imposed by the applicable governmental entity not being acceptable to either the Company or Schwazze, or, if acceptable, not being on terms that are favorable to the resulting company. There can be no assurance as to the outcome of the regulatory approval processes, including the undertakings and conditions that may be required for approval or whether the required regulatory approvals will be obtained. If not obtained, or if obtained on terms that are not satisfactory to either the Company or Schwazze, the Asset Sale may not be completed.

​

There can be no assurance that the RSA will not be terminated by the Company or Schwazze in certain circumstances.

​

Each of the Company and Schwazze has the right, in certain circumstances, to terminate the RSA. Accordingly, there can be no certainty, nor can we provide any assurance that the RSA will not be terminated by either of the Company or Schwazze prior to the completion of the Asset Sale. Any termination will result in the failure to realize the expected benefits of the Asset Sale in respect of the operations and business of the Company.

​

The uncertainty surrounding the Asset Sale could negatively impact Vireo's current and future operations, financial condition and prospects.

​

As the Asset Sale is dependent upon receipt, among other things, of the required regulatory approvals and satisfaction of certain other conditions, the Asset Sale’s completion is uncertain. If the Asset Sale is not completed for any reason, there are risks that the announcement of the Asset Sale and the dedication of Vireo's resources to the completion thereof could have a negative impact on its relationships with its stakeholders and could negatively impact current and future operations, financial condition and prospects of Vireo. In addition, Vireo has, and will continue to, incur significant transaction expenses in connection with the Asset Sale, regardless of whether the Asset Sale is completed.

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If the Company is not successful with its Credit Bid and able to acquire the assets that are the subject of the Asset Sale, the Company will not benefit from the expenses incurred in the pursuit thereof.

​

There is no assurance that the Company will successfully acquire the assets in the Asset Sale. If the Company does not acquire the assets in the Asset Sale, the Company will have incurred substantial expenses for which no ultimate benefit will have been received. The Company has incurred out-of-pocket expenses in connection with the RSA and Asset Sale, much of which will be incurred even if the Company does not acquire the assets in the Asset Sale.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

There were no unregistered sales of equity securities or repurchase of equity securities that occurred during the three months ended September 30, 2025.

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Item 5. Other Information

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Insider Trading Arrangements

​

During the three months ended September 30, 2025, none of our directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended) adopted, modified or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K of the Securities Act of 1933).

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Item 6. Exhibits

	​
Exhibit No.		Description of Exhibit
	​
2.2 ​	​	Agreement and Plan of Merger, dated as of December 18, 2024, by and among Vireo DR Merger Sub Inc., Vireo Growth Inc., Deep Roots Holdings, Inc. and Shareholder Representative Services LLC (incorporated by reference to Exhibit 2.2 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2024)
​	​	​
2.3	​	Agreement and Plan of Merger, dated as of December 18, 2024, by and among Vireo PR Merger Sub Inc., Vireo PR Merger Sub II Inc., Vireo Growth Inc., NGH Investments, Inc., Proper Holdings Management, Inc., Proper Holdings, LLC and Shareholder Representative Services LLC (incorporated by reference to Exhibit 2.3 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2024)
​	​	​
2.4	​	Agreement and Plan of Merger, dated as of December 18, 2024, by and among Vireo WH Merger Sub Inc., Vireo Growth Inc., WholesomeCo, Inc. and Shareholder Representative Services LLC (incorporated by reference to Exhibit 2.4 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2024)
​	​	​
2.5	​	First Amendment to Merger Agreement, by and among Vireo PR Merger Sub Inc., Vireo PR Merger Sub II Inc., Vireo Growth Inc., NGH Investments, Inc., Proper Holdings Management, Inc. and Proper Holdings, LLC (incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on March 20, 2025)
​	​	​
2.6	​	First Amendment to Merger Agreement, by and among Vireo DR Merger Sub Inc., Vireo Growth Inc. and Deep Roots Holdings, Inc. (incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K filed on March 20, 2025)
​	​	​
2.7	​	First Amendment to Merger Agreement, by and among Vireo WH Merger Sub Inc., Vireo Growth Inc. and WholesomeCo, Inc. (incorporated by reference to Exhibit 10.3 to our Current Report on Form 8-K filed on March 20, 2025)
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2.8	​	Second Amendment to Merger Agreement, dated as of June 5, 2025, by and among Vireo PR Merger Sub Inc., Vireo PR Merger Sub II Inc., Vireo Growth Inc., NGH Investments, Inc., Proper Holdings Management, Inc. and Proper Holdings, LLC (incorporated by reference to Exhibit 2.3 to our Current Report on Form 8-K filed on June 6, 2025)
​	​	​
2.9	​	Second Amendment to Merger Agreement, dated as of June 6, 2025, by and among Vireo DR Merger Sub Inc., Vireo Growth Inc. and Deep Roots Holdings, Inc. (incorporated by reference to Exhibit 2.3 to our Current Report on Form 8-K filed on June 12, 2025)
​	​	​
2.10	​	Second Amendment to Merger Agreement, dated as of May 12, 2025, by and among Vireo WH Merger Sub Inc., Vireo Growth Inc. and WholesomeCo, Inc. (incorporated by reference to Exhibit 2.3 to our Current Report on Form 8-K filed on May 12, 2025)
​	​	​
3.1	​	Articles of Vireo Growth Inc. dated June 25, 2024 (incorporated by reference to Exhibit 3.1 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2023). ​
3.2	​	Certificate of Name Change, dated June 9, 2021 (incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed June 9, 2021). ​
3.3	​	Notice of Articles, dated June 9, 2021 (incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K filed June 9, 2021).
​	​	​
3.4	​	Notice of Alteration, Notice of Articles and Certificate of Name Change dated June 25, 2024 (incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed July 1, 2024).
​	​	​
10.1+	​	Loan and Security Agreement, effective July 3, 2025, by and among Vireo Growth Inc. and each of its subsidiaries, the Guarantors from time to time party thereto, the financial institutions from time to time party thereto as Lenders, East West Bank, as Administrative Agent for the Lenders, and Western Alliance Bank, as Co-Administrative Agent for the Lenders, East West Bank, as collateral agent for the Lenders, and East West Bank and Western Alliance Bank, as Joint Lead Arrangers
​	​	​
10.2+	​	Secured Term Loan, effective July 3, 2025, by and among Vireo Growth Inc. and each of its subsidiaries, the Guarantors from time to time party thereto, Chicago Atlantic Opportunity Finance, LLC, as a Lender, Chicago Atlantic Admin, LLC, as Administrative Agent and Collateral Agent, and Chicago Atlantic Credit Advisers, LLC, as Lead Arranger
​	​	​
31.1	​	Rule 13a-14(a)/15d-14(a) certification of Chief Executive Officer
	​
31.2	​	Rule 13a-14(a)/15d-14(a) certification of Chief Financial Officer
​	​	​
32.1	​	Section 1350 certification, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
	​
101	​	Includes the following financial and related information from Vireo Growth’s Quarterly Report on Form 10-Q as of and for the quarter ended September 30, 2025, formatted in Inline Extensible Business Reporting Language (iXBRL): (1) the Consolidated Balance Sheets, (2) the Consolidated Statements of Income, (3) the Consolidated Statements of Comprehensive Income, (4) the Consolidated Statements of Changes in Stockholders’ Equity, (5) the Consolidated Statements of Cash Flows, and (6) Notes to Consolidated Financial Statements.
​	​	​
104	​	The cover page from this Quarterly Report on Form 10-Q, formatted in Inline XBRL. ​ ​
+	​	Portions of this exhibit have been omitted pursuant to Regulation S-K Item 601(a)(5) and Item 601(b)(10), as applicable.  The Company agrees to furnish any omitted schedules or an unredacted copy to the Commission or its staff upon request

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SIGNATURES

Pursuant to requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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​	​	​	​
​	VIREO GROWTH INC. (Registrant)
​	​	​
Date: November 12, 2025	By:	/s/ John Mazarakis
​	​	Name:	John Mazarakis
​	​	Title:	Chief Executive Officer and Co-Executive Chairman (principal executive officer) ​
​	​	​
Date: November 12, 2025	By:	/s/ Tyson Macdonald
​	​	Name:	Tyson Macdonald
​	​	Title:	Chief Financial Officer (principal financial officer) ​ ​
Date: November 12, 2025	By:	/s/ Joseph Duxbury
​	​	Name:	Joseph Duxbury
​	​	Title:	Chief Accounting Officer (principal accounting officer) ​

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