What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-05-12 compared with 2025-11-12 · 82 added, 138 removed, 119 unchanged (65% of the section changed)

16 unchanged sentences

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.

Vireo Growth is a cannabis company whose mission is to provide safe access, quality products and value to its customers while supporting its local communities through active participation and restorative justice programs.

The Company is evolving with the industry and is in the midst of a transformation to being significantly more customer-centric across its operations, which include cultivation, manufacturing, wholesale and retail business lines.

With our core operations strategically located in eight limited-license markets through our state-licensed subsidiaries, we cultivate and manufacture cannabis products and distribute these products through our growing network of retail dispensaries we own or operate as well as to third-party dispensaries in the markets in which our subsidiaries hold operating licenses.

Operating Segment

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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

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 ”).

During the three months ended March 31, 2026, the Company had operating revenue in eight states:

Colorado, Maryland, Minnesota, New Mexico, New York, Missouri, Nevada, and Utah.

Retail revenues during the three months ended March 31, 2026 were derived from sales in 82 dispensaries throughout these eight states.

We had 24 operational dispensaries in Colorado, 8 in Minnesota, 21 in New Mexico, 4 in New York, 2 in Maryland, 11 in Missouri, 11 in Nevada, and 1 in Utah.

Business Combinations

On December 18, 2024, we entered into the Merger Agreements in connection with the Deep Roots Merger, the Proper Mergers, and the Wholesome 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

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

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.

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.

On March 19, 2026, the Company completed the acquisition of a controlling interest in Vireo Health of Rocky Mountain, LLC, which acquired 45 dispensaries and two manufacturing facilities in Colorado and New Mexico through the previously announced Schwazze restructuring transaction.

Three months ended March 31, 2026, Compared to Three months ended March 31, 2025

We derived our revenue from cultivating, processing, and distributing cannabis products through our 82 dispensaries in eight states and our wholesale sales to third parties in eight states.

For the three months ended March 31, 2026, 85% of our revenue was generated from retail dispensaries and 15% from the wholesale business.

For the three months ended March 31, 2025, 78% of our revenue was generated from retail business and 22% from wholesale business.

For the three months ended March 31, 2026, Colorado operations contributed approximately 3% of revenues, Minnesota contributed 17%, New York contributed 6%, New Mexico contributed 1%, Maryland contributed 9%, Utah contributed 14%, Nevada contributed 26%, and Missouri contributed 24%.

For the three months ended March 31, 2025, Minnesota operations contributed approximately 46% of revenues, New York contributed 9%, and Maryland contributed 44%.

Revenue for the three months ended March 31, 2026, was $106.2 million, an increase of $81.7 million or 333% compared to revenue of $24.5 million for the three-months ended March 31, 2025.

The increase was primarily attributable to the closing of various acquisitions resulting in the addition of revenues from our operations in Colorado, New Mexico, Utah, Nevada, and Missouri.

Retail revenue for the three months ended March 31, 2026, was $89.9 million, an increase of $70.7 million or 368% compared to retail revenue of $19.2 million for the three months ended March 31, 2025.

The increase was primarily attributable to the closing of various acquisitions resulting in the addition of revenues from our operations in Colorado, New Mexico, Utah, Nevada, and Missouri.

Wholesale revenue for the three months ended March 31, 2026, was $16.3 million, an increase of $11.0 million compared to wholesale revenue of $5.3 million for the three months ended March 31, 2025.

The increase was primarily due to

increased contributions from New York, and the closing of various acquisitions, resulting in the addition of revenues from our operations in Colorado, New Mexico, Utah, Nevada, and Missouri.

Three Months Ended

September 30,

Total Wholesale

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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.

Cost of sales for the three months ended March 31, 2026, was $46.9 million, an increase of $34.8 million compared to the three months ended March 31, 2025, of $12.1 million.

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.

Gross profit for the three months ended March 31, 2026, was $59.3 million, representing a gross margin of 55.8%.

In comparison, gross profit for the three months ended March 31, 2025, was $12.4 million or a 50.6% gross margin.

The increase in gross profit was driven by the closing of various acquisitions, which added the gross profits in Colorado, New Mexico, Nevada, Missouri, and Utah.

The increase in gross margin is also attributable to acquisition-related activity, as the businesses acquired generated higher margins than the businesses included in the comparative period.

Total Expenses

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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.

Total expenses for the three months ended March 31, 2026, were $50.4 million an increase of $39.9 million compared to total expenses of $10.4 million for the three months ended March 31, 2025.

The increase in total expenses was primarily attributable to an increase in transaction expenses associated with the newly-acquired businesses, an increase in stock-based compensation expense, and the addition of operating expenses in Colorado, New Mexico, Nevada, Missouri, and Utah.

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.

Operating income before other income (expense) and provision for income taxes for the three months ended March 31, 2026, was $9.0 million an increase of $7.0 million compared to $2.0 million for the three months ended March 31, 2025.

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.

Total other expense for the three months ended March 31, 2026, was $13.2 million an increase of $6.4 million compared to total other expense of $6.8 million for the three months ended March 31, 2025.

This change was primarily attributable to the remeasurement of contingent consideration associated with the Mergers, which resulted in a $5.5 million loss during the three months ended March 31, 2026.

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.

For the three months ended March 31, 2026, tax expense totaled $16.1 million compared to tax expense of $1.7 million for the three months ended March 31, 2025.

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

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%.

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,

Total Wholesale

Total Revenue

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 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.

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.

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

measure that does not have a standardized definition under GAAP.

Earnings before interest, taxes, depreciation and amortization (“ EBITDA ”) and Adjusted EBITDA are non-GAAP measures that do not have standardized definitions under GAAP.

Total revenues, excluding revenues from states where we have divested operations, is also a non-GAAP 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.

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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.

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,

Net income (loss)

5 unchanged sentences

Grown Rogue termination fee included in cost of goods sold

Change in the fair value of contingent consideration

Stock-based compensation

Transaction related expenses

Debt financing costs

Other (income) expense

Severance expense

Loss on disposal of assets

Adjusted EBITDA (non-GAAP)

5 unchanged sentences

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.

In connection with the closing of the Proper Mergers, the Company became obligated under $25.5 million 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.

In addition, 1% amortization of the original principal value of the note, or $27.1 million, was payable monthly, and the note was set to mature on November 28, 2025.

See Note 3 “Business Combinations and Dispositions” for additional information.

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.

In connection with the closing of the Deep Roots Merger, the Company became obligated under $19.2 million 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.

In addition, 0.83% amortization of the original principal value of the note, or $20 million, 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.

In connection with the closing of the Wholesome Merger, the Company became obligated on a $8.8 million 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.

Additionally, the Company became obligated on $1.0 million 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.

On July 3, 2025, the Company entered into the First Lien Term Loan, effective July 7, 2025, with East West Bank, as Administrative Agent, and Western Alliance Bank, as co-administrative agent.

The First Lien Term Loan provides for an aggregate principal amount of $120 million.

The aggregate principal amount of the First Lien Term Loan amortizes in quarterly installments of $3 million.

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 July 3, 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.

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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.

On July 3, 2025, the Company entered into the Chicago Atlantic Term Loan, effective July 7, 2025, with 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.

The Chicago Atlantic Term Loan provides for a principal amount of $33 million to be loaned to the Company along with a $50 million 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.

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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, which is included in other expense on the statement of loss and comprehensive loss for the three and nine months ended September 30, 2025.

Long-Term Debt Arising from Vireo Health of Rocky Mountain

On February 27, 2026, CO Acquisition was acquired by the Company pursuant to a membership interest purchase agreement.

In connection with the closing of this acquisition, the Company became obligated under $28.2 million of notes payable due to Chicago Atlantic Admin, LLC.

The outstanding principal balance bears interest at a fixed rate of 20.0% per annum and matures on December 31, 2029.

The default rate of interest is equal to the interest rate plus 10.0% per annum.

All interest accrued until June 3, 2026 is payable in kind.

Thereafter, interest will be paid monthly.

If the loans are prepaid in an amount equal to $16 million or more or accelerated on or before March 30, 2027, the borrowers must pay a make-whole amount equal to all interest that would have accrued through March 30, 2027.

In connection with the closing of the Asset Sale, the Company became obligated under $44.3 million of notes payable due to Chicago Atlantic Financial Services, LLC.

The unpaid principal amounts outstanding bear interest at a rate of 12%, payable monthly in cash and mature on December 31, 2031.

If the loans are prepaid or accelerated on or before June 19, 2026, the Company must pay a make-whole amount equal to all interest that would have accrued through June 19, 2026.

See Note 3 “Business Combinations and Dispositions” for additional information.

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.

As of March 31, 2026, and December 31, 2025, $5.3 million and $5.7 million of deferred financing costs remained unamortized, respectively.

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.

On July 7, 2025, the Company retired the Convertible Notes, and issued 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 the 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 (i) the sum of (A) the result of $10,000,000 minus 50.00% of the aggregate amount of all the New Convertible Notes repaid plus (B) all accrued but unpaid interest on the New Convertible Notes on the date of such conversion by (ii) a conversion price equal to $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.

As of each of March 31, 2026 and December 31, 2025, $0 deferred financing costs remained unamortized, respectively.

Cash Provided by Operating Activities

Net cash provided by operating activities was $11.9 million for the three months ended March 31, 2026, an increase of $15.3 million as compared to net cash used in operating activities of $3.4 million for the three months ended March 31, 2025.

The increase was primarily driven by higher revenues and operating income resulting from the Company’s expanded operations following the completed acquisition activity.

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.

Net cash provided by investing activities was $8.0 million for the three months ended March 31, 2026, an increase of $9.1 million compared to net cash used in investing activities of $1.1 million for the three months ended March 31, 2025.

The increase was primarily attributable to the cash acquired through the closing of Vireo Health of Rocky Mountain during the three-months ended March 31, 2026, 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.

Net cash used in financing activities was $4.6 million for the three months ended March 31, 2026, a change of $3.7 million as compared to $0.9 million used in financing activities for the three months ended March 31, 2025.

The change was principally due to increased principal repayments on the First Lien Term Loan and Chicago Atlantic Term Loan relative to the comparative period.

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.

As of March 31, 2026, we are party to lease agreements for the use of buildings used in the cultivation, production and/or sales of cannabis products in Colorado, New Mexico, 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

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.

In some cases, we have received tenant improvement funds to assist in the buildout of the spaces to meet our operating needs.

As of March 31, 2026, we operated 82 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.

3 unchanged sentences

Finance Leases

September 30, 2025

March 31, 2026

Total minimum lease payments

Less discount to net present value

(171,368,934)

(188,270,108)

Less liabilities held for sale

Present value of lease liability

1 unchanged sentence

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:

As of May 12, 2026, we had 1,383,830,362 shares issued and outstanding on an as converted basis, consisting of the following:

(a) Subordinate Voting Shares

8 unchanged sentences

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.

As of March 31, 2026, we had 34,629,892 employee stock options outstanding, 59,565,217 RSUs outstanding, and 15,503,937 Subordinate Voting Share compensation warrants outstanding.

Off-Balance Sheet Arrangements

5 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis