Vireo Growth Inc.

Current report (Form 8-K) · Jun 11, 2026 · Acquisition or asset sale · Financial statements

Company

Vireo Growth Inc.

Documents

Primary topic

Acquisition or asset sale

Filed

Jun 11, 2026

Overview Analysis Documents(13)Full text Exhibits(3)

EX-99.1 · vreof-20260331xex99d1.htm

Type

EX-99.1

File

vreof-20260331xex99d1.htm

Document text
EX-99.1 · vreof-20260331xex99d1.htm EX-99.1 3 vreof-20260331xex99d1.htm EX-99.1 Table of Contents Exhibit 99.1 Table of Contents EAZE, INC. AND SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS TABLE OF CONTENTS Page INDEPENDENT AUDITOR’S REPORT 1 - 2 CONSOLIDATED FINANCIAL STATEMENTS: Consolidated Balance Sheet 3 Consolidated Statement of Operations 4 Consolidated Statement of Changes in Stockholders’ Equity 5 Consolidated Statement of Cash Flows 6 Notes to Consolidated Financial Statements 7 - 19 Table of Contents June 2, 2026 To the Stockholders of Eaze, Inc. and Subsidiaries Edgewater, Colorado Independent Auditor’s Report Opinion We have audited the accompanying consolidated financial statements of Eaze, Inc. and Subsidiaries (the Company), which comprise the consolidated balance sheet as of December 31, 2025, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for the year then ended, and the related notes to the consolidated financial statements. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Eaze, Inc. and Subsidiaries as of December 31, 2025, and the results of their operations and their cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinion We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Emphasis of Matter As discussed in Note J to the consolidated financial statements, the Company operates in the cannabis industry which is legal in the State of Colorado, California, and Florida, but illegal under United States federal law. Our opinion is not modified with respect to this matter. Responsibilities of Management for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued. HILL , BARTH & KING LLC \| 301 YAMATO ROAD, SUITE 3130 \| BOCA RATON, FL 33431 \| TEL 239-263-2111 \| FAX 239-263-0496 \| HBKCPA.COM - 1 - Table of Contents Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements. In performing an audit in accordance with generally accepted auditing standards, we: ● Exercise professional judgment and maintain professional skepticism throughout the audit. ● Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. ● Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly, no such opinion is expressed. ● Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the consolidated financial statements. ● Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit. Certified Public Accountants - 2 - Table of Contents EAZE, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET DECEMBER 31, 2025 ASSETS CURRENT ASSETS Cash and cash equivalents $ 3,259,716 Accounts receivable, net of allowance for credit losses of $497,418 1,848,176 Inventory 11,428,335 Prepaid expenses 1,953,506 Other current assets 106,615 TOTAL CURRENT ASSETS 18,596,348 PROPERTY AND EQUIPMENT, NET 28,136,691 OTHER ASSETS Right-of-use assets - operating 33,398,798 Right-of-use assets - finance 3,636,308 Intangibles, net 15,661,186 Other assets 1,337,976 Deferred tax asset 1,077,906 TOTAL ASSETS $ 101,845,213 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 6,624,113 Accrued expenses 5,304,942 Accrued taxes payable 6,276,508 Income taxes payable 7,739,950 Current portion of operating lease liabilities 3,864,415 Current portion of finance lease liabilities 1,631,126 Current portion of long-term debt 5,227,708 TOTAL CURRENT LIABILITIES 36,668,762 LONG-TERM LIABILITIES Operating lease liabilities, net of current portion 33,203,198 Finance lease liabilities, net of current portion 1,395,880 Uncertain tax position 11,791,706 Long-term debt, net of current portion 2,230 TOTAL LIABILITIES 83,061,776 STOCKHOLDERS’ EQUITY 18,783,437 $ 101,845,213 See accompanying notes to consolidated financial statements - 3 - Table of Contents EAZE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 2025 OPERATING INCOME Sales $ 141,140,072 Cost of goods sold 82,148,802 GROSS PROFIT 58,991,270 OPERATING EXPENSES 69,605,575 LOSS FROM OPERATIONS (10,614,305) OTHER INCOME (EXPENSE) Interest income 107 Interest expense (353,056) Other income 602,451 Other expense (929,082) (679,580) LOSS BEFORE PROVISION FOR INCOME TAXES (11,293,885) PROVISION FOR INCOME TAXES 12,829,392 NET LOSS $ (24,123,277) See accompanying notes to consolidated financial statements - 4 - Table of Contents EAZE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY YEAR ENDED DECEMBER 31, 2025 Common Stock Preferred Stock Additional Accumulated Class A Class B Series A Series B Paid-in Capital Deficit Total Balance, December 31, 2024 $ — $ 4 $ 54,020,000 $ 10,000,000 $ 24,578 $ (21,198,888) $ 42,845,694 Stock-based compensation — — — — 61,020 — 61,020 Net loss — — — — — (24,123,277) (24,123,277) Balance, December 31, 2025 $ — $ 4 $ 54,020,000 $ 10,000,000 $ 85,598 $ (45,322,165) $ 18,783,437 See accompanying notes to consolidated financial statements - 5 - Table of Contents EAZE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS YEAR ENDED DECEMBER 31, 2025 CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ (24,123,277) Adjustments to reconcile net loss to net cash used in by operating activities: Depreciation 5,039,829 Amortization 1,320,809 Amortization of operating right-of-use assets 4,130,501 Amortization of finance right-of-use assets 1,125,091 Provision for credit losses 203,251 Compensation expense related to stock-based awards 61,020 Paid-in-kind interest 218,496 Deferred income tax benefit (781,559) Changes in assets and liabilities: Accounts receivable (485,849) Inventory 1,288,871 Prepaid expenses 71,099 Other current assets (38,005) Intangible assets (2,738,637) Other assets (443,606) Accounts payable (1,564,302) Accrued expenses 951,331 Accrued taxes payable (881,741) Income taxes payable 2,117,004 Uncertain tax position 11,791,706 Operating lease payments (4,249,994) NET CASH USED IN OPERATING ACTIVITIES (6,987,962) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property and equipment, net (1,099,770) NET CASH USED IN INVESTING ACTIVITIES (1,099,770) CASH FLOWS FROM FINANCING ACTIVITIES Principal payments under finance lease obligations (1,439,491) Borrowings on long-term debt 5,000,000 Repayment of principal portion of long-term debt (1,433,043) NET CASH PROVIDED BY FINANCING ACTIVITIES 2,127,466 NET DECREASE IN CASH AND CASH EQUIVALENTS (5,960,266) CASH AND CASH EQUIVALENTS Beginning of year 9,219,982 End of year $ 3,259,716 SUPPLEMENTARY CASH FLOW INFORMATION Cash paid for interest $ 353,056 Interest paid-in kind $ 218,496 See accompanying notes to consolidated financial statements - 6 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2025 NOTE A – NATURE OF OPERATIONS Eaze, Inc. (the Company) is a corporation that was formed and began operations on August 6, 2024, under the laws of the State of Delaware. The Company is engaged in the business of cultivating, manufacturing, and selling medicinal and adult-use cannabis products in Colorado, California, and Florida. On August 21, 2024, Eaze, Inc. and Subsidiaries entered into an agreement and plan of acquisition (the Acquisition) with Eaze Technologies, Inc. and its subsidiaries, pursuant to which Eaze, Inc. and Subsidiaries would acquire all assets and liabilities of Eaze Technologies, Inc. and its subsidiaries. NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Company’s consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). The summary of significant accounting policies presented below is designed to assist in understanding the Company’s consolidated financial statements. Such consolidated financial statements and accompanying notes are the representations of management, who is responsible for their integrity and objectivity. Basis of Consolidation The consolidated financial statements include the accounts of Eaze, Inc. and its subsidiaries, Eaze Colorado, LLC, Eaze California, LLC, and Eaze Florida, LLC. Cash and Cash Equivalents The Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. The Company has no cash equivalents as of December 31, 2025 . Credit Risk The Company maintains cash balances at financial institutions in excess of federally insured limits from time to time. The Company has experienced no loss due to this concentration. Significant Accounting Judgments, Estimates, and Assumptions The preparation of consolidated financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, and revenue and expenses. Actual results may differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. - 7 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Accounts Receivable and Allowance for Credit Losses The Company’s accounts receivable are primarily due from wholesale customers. Credit is extended to customers based on an evaluation of each customer’s creditworthiness and financial condition; collateral is not required. The Company maintains allowances for credit losses, returns and discounts. The Company evaluates the collectability of its accounts receivable based on a combination of prospective factors. The allowance for credit losses is based on the aging of such receivables and any known specific collectability exposures as well as financial stability of its customers. Accounts are written off when deemed uncollectible. It is reasonably possible that the Company’s estimate of the allowance for credit losses will change. 2025 Beginning balance $ 415,453 Current provision 203,251 Write-offs (121,286) Ending balance $ 497,418 Inventory Inventories are valued at the lower of cost or market. Inventory consists primarily of raw materials, work-in-process, and finished goods. Due to state and federal regulations, the Company tracks its cannabis products including raw materials from seed to finished goods. Work-in-process consists of raw materials, direct labor, and related production overhead. Costs incurred during the production process are capitalized as incurred to the extent that cost is less than net realizable value. These costs include materials, labor and manufacturing overhead used in the production processes. Inventories of purchased finished goods and packing materials are initially valued at cost and subsequently at the lower of cost or net realizable value. Net realizable value is determined by the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. Cost is determined using the weighted average cost basis and is a significant estimate. Products for resale and supplies and consumables are valued at lower of cost or net realizable value. The Company reviews inventory for obsolete, redundant, and slow-moving goods and any such inventories are written down to net realizable value. As of December 31, 2025 , there were no reserves for obsolete inventories. Prepaid Expenses The Company pays for certain expenses in advance of receipt of goods or services. The amount is expensed over the term of contract or period for which the expenses are incurred, using the straight-line method. Property and Equipment Property and equipment are recorded at cost, including capitalized borrowing costs, net of depreciation. Expenditures for ordinary repairs and maintenance are charged to expense as incurred. Expenditures that materially increase the life of the assets are capitalized. Depreciation is computed using the straight-line method over the assets’ estimated useful life. - 8 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Property and Equipment (Continued) Asset classes and their respective useful lives are as follows: Life (years) Buildings 30 Leasehold improvements 5-15 Computers and equipment 5-15 Vehicles 5 Furniture and fixtures 5 The assets’ residual values, useful lives and methods of depreciation are reviewed at each financial year-end and adjusted prospectively if appropriate. An item of equipment is derecognized upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying value of the asset) is included in operations in the year the asset is derecognized. Leased Assets The Company leases equipment and real property for retail stores and cultivation facilities. The Company determines if an arrangement is a lease at inception. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The ROU assets also include any lease payments made and exclude lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments are recognized on a straight-line basis over the lease term. The lease agreements do not contain any material residual value guarantees or material restrictive covenants. Additionally, for real property leases, the Company applies a portfolio approach to effectively account for the operating lease ROU assets and liabilities. Intangible Assets The Company’s intangible assets consist of a Medical Marijuana Treatment Center (“MMTC”) license for the State of Florida, which is classified as an indefinite ‑ lived intangible asset, and tradenames and technology, which are classified as finite ‑ lived intangible assets with estimated useful lives of twelve years and five years, respectively. Finite ‑ lived intangible assets are amortized on a straight ‑ line basis over their estimated useful lives and are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable, in accordance with the guidance for long ‑ lived assets. Indefinite ‑ lived intangible assets are not amortized but are tested for impairment at least annually, or more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. In performing the annual impairment assessment for indefinite ‑ lived intangible assets, the Company may first perform a qualitative assessment to determine whether it is more likely than not that the asset is impaired; if, based on this assessment, it is more likely than not that the asset is impaired, or if the Company elects to bypass the qualitative assessment, the Company estimates the fair value of the asset and records an impairment loss for any excess of the carrying amount over its fair value. - 9 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Revenue Recognition Revenue is recognized by the Company in accordance with FASB Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606). Through application of the standard, the Company recognizes revenue to depict the transfer of promised goods or services to the customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. In order to recognize revenue under ASC 606, the Company applies the following five (5) steps: ● Identify a customer along with a corresponding contract; ● Identify the performance obligation(s) in the contract to transfer goods or provide distinct services to a customer; ● Determine the transaction price the Company expects to be entitled to in exchange for transferring promised goods or services to a customer; ● Allocate the transaction price to the performance obligation(s) in the contract; ● Recognize revenue when or as the Company satisfies the performance obligation(s). Revenues consist of wholesale and retail sales of cannabis, which are recognized upon satisfaction of the performance obligation, which occurs at a point in time when control over the goods have been transferred to the customer and is recorded net of sales discounts. Payment is typically due upon transferring the goods to the customer or within a specified time period permitted under the Company’s credit policy. The Company generates advertising revenue primarily from selling advertising placements on its digital platforms and other media to cannabis and non ‑ cannabis brands. The Company accounts for revenue from contracts with customers in accordance with ASC 606, Revenue from Contracts with Customers. Advertising contracts typically specify the nature of the advertising services (such as display impressions, sponsored content, or campaign packages), the campaign period, and the pricing, which may be based on a cost ‑ per ‑ impression, cost ‑ per ‑ click, fixed fee, or other usage ‑ based metric. The Company identifies a contract with a customer when it is approved, each party’s rights and payment terms are identified, the contract has commercial substance, and it is probable that the Company will collect substantially all consideration to which it will be entitled in exchange for the advertising services to be transferred. The Company’s advertising services generally represent a single performance obligation to provide access to the Company’s advertising inventory and deliver the purchased impressions or other agreed ‑ upon advertising units over the campaign term. For impression ‑ or click ‑ based arrangements, the transaction price is generally variable because it is based on the number of impressions served or clicks delivered. The Company estimates the transaction price, including variable consideration, using the expected value method and applies the constraint on variable consideration where applicable, considering the potential for credits, make ‑ goods, and similar adjustments. The transaction price is allocated to the single performance obligation and revenue is recognized over time as the advertisements are delivered, generally based on the number of impressions or other measurable outputs delivered during the reporting period relative to the total contracted units. Advertising Costs Advertising and marketing costs are expensed as incurred. During the year ended December 31, 2025, the Company incurred advertising and marketing costs totaling $3,143,109. Share Based Compensation The Company awards stock options and restricted stock units (“RSUs”) to board members, officers, and certain management employees of the Company. All share-based payments are measured using a fair-value based method. The Company accounts for forfeitures as they occur. Share based compensation costs are recognized in the consolidated statement of operations using the graded-vesting method over the award term. - 10 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Share Based Compensation (Continued) Stock Options: The fair value of stock options is estimated using the Black-Scholes option pricing model. Assumptions used in the model include: ● Expected term - the expected term represents the period of time in years that options granted are expected to be outstanding and is computed using the simplified method as the Company has insufficient historical information regarding its stock options to provide a basis for an estimate. ● Expected volatility - the Company estimates expected volatility using the historical volatility of the Company. In cases where there is insufficient trading history, the expected volatility is estimated using the historical volatility of other companies that the Company considers comparable that have trading and volatility history prior to the Company becoming public. ● Expected annual rate of dividends - is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. ● Risk free annual interest rate - based on the United States bond yield rate at the time of grant using the expected term of the award. Restricted Stock Units: Restricted Stock Units (“RSUs”) represent a right to receive a single Subordinate Voting Share that is both non-transferable and forfeitable unless and until certain conditions are satisfied. The fair value of RSUs is determined by the fair market value of the Company’s common stock on the grant date. Income Taxes The Company uses the asset and liability method to account for income taxes. Deferred income tax assets and liabilities are determined based on enacted tax rates and laws for the years in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Significant judgment is required in evaluating the Company’s uncertain tax positions and determining the provision for income taxes. The Company recognizes benefits from uncertain tax positions based on the cumulative probability method whereby the largest benefit with a cumulative probability of greater than 50% is recorded. An uncertain tax position is not recognized if it has a 50% or less likelihood of being sustained. Recognition or measurement is reflected in the period in which the likelihood changes. Any interest and penalties related to unrecognized tax liabilities are recorded in provision for income taxes on the consolidated statements of operations. The IRS has taken the position that IRC section 280E prevents cannabis companies from deducting any business expenses other than those included in the cost of goods sold. Eaze Colorado, LLC, Eaze California, LLC, and Eaze Florida, LLC are disregarded entities for U.S. federal and state income tax. Therefore, no provision for income taxes related to these subsidiaries have been included in the consolidated financial statements. - 11 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Variable Interest Entities Under an expanded optional private company alternative established in ASU No. 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities, a private company (i.e., the reporting entity) may elect not to apply Variable Interest Entity (VIE) guidance to legal entities under common control (including common control leasing arrangements) if both the parent and the legal entity being evaluated for consolidation are not public business entities. Effectively, this private company accounting alternative, which covers all common control arrangements meeting certain conditions, expands the scope of the alternative allowing private companies not to apply the VIE guidance to qualifying common control leasing arrangements, which was established in ASU No. 2014-07, Consolidation (Topic 810): Applying Variable Interest Entities Guidance to Common Control Leasing Arrangements. Accordingly, ASU No. 2018-17 supersedes the alternative covering only leasing arrangements. The optional accounting alternative, pursuant to which a private company (i.e., the reporting entity) is not required to apply VIE guidance to a legal entity, may be used if all of the following criteria are met: ● The reporting entity and the legal entity are under common control. ● The reporting entity and the legal entity are not under common control of a public business entity. ● The legal entity under common control is, itself, not a public business entity. ● The reporting entity does not otherwise directly or indirectly have a controlling financial interest in the legal entity. The Company has determined that its subsidiary, Hometown Hearts, Inc. (“Hometown Hearts”), is a variable interest entity (“VIE”) under ASC 810-10-15-14 through 15-17 because the equity investors at risk, as a group, lack substantive power over the activities that most significantly affect Hometown Hearts’ economic performance and do not hold the substantive economics of the entity; substantially all significant operating activities and economic interests are directed to, and borne by, the Company through a management services agreement and related support arrangements. The Company, through its involvement with Hometown Hearts, including the management services agreement, has both (i) the power to direct the activities that most significantly affect Hometown Hearts’ economic performance and (ii) the obligation to absorb losses of, and the right to receive benefits from, Hometown Hearts that could potentially be significant, and therefore is the primary beneficiary of Hometown Hearts under ASC 810-10-25-38A through 25-38J. Accordingly, the Company consolidates 100% of Hometown Hearts’ assets, liabilities, revenues, expenses and cash flows in these consolidated financial statements in accordance with ASC 810-10. The carrying amounts and classification of Hometown Hearts’ consolidated assets and liabilities are included within the respective line items in the Company’s consolidated balance sheet, and those assets and liabilities are subject to the same accounting policies as the Company’s other consolidated subsidiaries, with additional disclosure provided in this note to meet the qualitative and quantitative disclosure objectives of ASC 810-10-50-2AA and 50-3, including the significant judgments and assumptions made in reaching the conclusion that the Company is the primary beneficiary and the nature of, and risks associated with, the Company’s involvement with Hometown Hearts. - 12 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Subsequent Events Management evaluated all activity of the Company through June 2, 2026, the date the consolidated financial statements were available to be issued, and concluded that no subsequent events have occurred that would require recognition or disclosure in the consolidated financial statements or notes, with exception of the following: Subsequent to the December 31, 2025, on April 23, 2026, the U.S. Department of Justice issued a final order under the Controlled Substances Act that reclassifies certain marijuana ‑ related products and materials associated with medical marijuana from Schedule I to Schedule III, while leaving other marijuana material classified in Schedule I. This change follows a scientific and medical recommendation from the U.S. Department of Health and Human Services that marijuana be rescheduled to Schedule III. The Company operates in the cannabis industry and is subject to federal, state, and local regulation. The reclassification is expected to impact the Company’s operations, regulatory compliance requirements, and income tax position, including the applicability of Internal Revenue Code Section 280E to certain of the Company’s activities. Management is currently evaluating the effects of this change in federal law on the Company’s business, financial position, results of operations, and cash flows, including potential changes in income tax accounting. At this time, the Company is unable to reasonably estimate the quantitative impact of this subsequent event on its consolidated financial statements. The accompanying consolidated financial statements do not reflect any adjustments related to this event, as the change in classification occurred after the balance sheet date and relates to conditions that did not exist at that date. On April 1, 2026, the Company entered into a definitive agreement with Vireo Growth Inc to purchase substantially all of the assets and membership interest of the Company. Closing is subject to certain shareholder and regulatory approvals. NOTE C – INVENTORY Inventory as of December 31, 2025 consisted of the following: Raw materials $ 461,417 Work-in-process 2,560,241 Finished goods 8,406,677 Total $ 11,428,335 - 13 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE D – PROPERTY AND EQUIPMENT Net property and equipment as of December 31, 2025 consisted of the following: Computers and equipment $ 6,771,154 Furniture and fixtures 66,098 Vehicles 128,284 Leasehold improvements 26,015,663 Construction in progress 1,063,067 34,044,266 Less accumulated depreciation 5,907,575 Property and equipment, net $ 28,136,691 Depreciation expense totaled $5,039,829 of which $2,824,551 was included in cost of goods sold, for the year ended December 31, 2025. NOTE E – LEASES The Company maintains operating and finance leases for equipment, vehicles, retail space, and manufacturing facilities, with remaining lease terms ranging from one to ten years. For the year ended December 31, 2025 , the components of lease expense were as follows: Operating lease cost $ 11,425,702 Finance lease cost: Amortization of right-of-use assets $ 1,125,091 Interest on lease liabilities 505,037 Total finance lease cost $ 1,630,128 As of December 31, 2025, other information related to leases was as follows: Weighted Average Remaining Lease Term Operating leases 6.47 Finance leases 2.08 Weighted Average Discount Rate Operating leases 18.30 % Finance leases 12.56 % Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 721,765 - 14 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE E – LEASES (CONTINUED) The maturity of the contractual undiscounted lease liabilities at December 31, 2025 is as follows: Operating Finance Leases Leases 2026 $ 10,328,871 $ 1,928,918 2027 9,509,972 1,379,684 2028 9,062,065 87,635 2029 8,935,158 18,447 2030 8,702,939 — Thereafter 22,808,726 — Total future minimum lease payments 69,347,731 3,414,684 Less imputed interest 32,280,118 387,678 Total $ 37,067,613 $ 3,027,006 NOTE F – INTANGIBLE ASSETS Intangible assets are recorded at cost less accumulated amortization and impairment losses, if any. Intangible assets acquired in a business combination are measured at fair value at the acquisition date. Amortization of definite life intangibles is provided on a straight-line basis over their estimated useful lives. The estimated useful lives, residual values, and amortization methods are reviewed at each year end, and any changes in estimates are accounted for prospectively. Intangible assets as of December 31, 2025, are summarized as follows: Licenses Tradenames Technology Cost Balance as of January 1, 2025 $ 7,000,000 $ 3,589,000 $ 3,985,251 Purchases — — 2,738,637 Balance as of December 31, 2025 7,000,000 3,589,000 6,723,888 Accumulated Amortization Balance as of January 1, 2025 — (99,693) (231,200) Amortization — (299,083) (1,021,726) Balance as of December 31, 2025 — (398,776) (1,252,926) Net Book Balance Balance as of January 1, 2025 7,000,000 3,489,307 3,754,051 Balance as of December 31, 2025 $ 7,000,000 $ 3,190,224 $ 5,470,962 The Company recorded amortization expense of $1,320,809 for the year ended December 31, 2025. Amortization periods of assets with finite lives are based on management’s estimates at the date of acquisition. - 15 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE G – LONG-TERM DEBT The Company entered into a promissory note agreement with a lender under which the lender committed to purchase secured notes in an aggregate principal amount of up to $5,000,000 (the “Facility”). The Company issued an initial secured note in the principal amount of $1,500,000 (the “Secured Note”) to the lender on that date and received cash proceeds of $1,500,000. As of December 31, 2025, the outstanding principal balance of the Secured Note was $1,500,000. The Secured Note bears interest at a fixed rate of 15.0% per annum on the outstanding principal balance. Interest is payable on the first business day of each month (each, a “Payment Date”) and is generally paid in kind (“PIK Interest”) by being added to the principal amount of the Secured Note, after which interest accrues on the increased principal balance; the Company may elect on any Payment Date to pay some or all of such interest in cash instead of having it capitalized. Upon the occurrence and during the continuance of an event of default, the lender may, at its option, increase the interest rate by 5 percentage points per annum. The Secured Note matures on June 30, 2026 (the “Maturity Date”). On the earlier of the Maturity Date or the consummation of a change of control (as defined in the agreement), the Company is required to repay in full the then ‑ outstanding principal amount of the Secured Note, all accrued and unpaid interest, and all other amounts then due under the promissory note agreement and related documents. The Company may redeem (prepay) the Secured Note, in whole or in part, at any time upon at least 10 business days’ prior written notice to the lender at a price equal to the principal amount being prepaid plus accrued and unpaid interest to the redemption date and any other amounts then due. The Secured Note is secured by a first ‑ priority security interest in substantially all of the personal property and other assets of the Company and the other issuer entities party to the agreement, including, among other things, accounts, deposit accounts and cash, equipment, inventory, general intangibles, investment property, and the proceeds of the foregoing (the “Collateral”). In addition, the Company is required, upon the formation or acquisition of any U.S. ‑ organized subsidiary, to cause such subsidiary to guarantee the obligations under the Facility and to grant the lender a first ‑ priority security interest in substantially all of its assets. Disclosure of assets pledged as security for loans is required by ASC 440 ‑ 10 ‑ 50 ‑ 1. The promissory note agreement contains customary affirmative and negative covenants, including, among others, requirements to provide monthly and quarterly financial statements, to comply in all material respects with applicable laws, restrictions on certain changes in the Company’s legal name, entity type, jurisdiction of organization, or principal place of business, restrictions on changes of control while obligations or unfunded commitments are outstanding, and limitations on the use of proceeds (including prohibitions on transferring or investing loan proceeds in non ‑ U.S. subsidiaries). Events of default include, among others, failure to pay amounts when due and certain bankruptcy or insolvency events, upon which the lender may accelerate the Secured Note and exercise remedies against the Collateral. The Company was in compliance with the covenants of the Secured Note as of December 31, 2025. Maturities related to long-term debt are as follows: 2026 $ 5,227,708 2027 2,230 Total $ 5,229,938 - 16 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE H – STOCKHOLDERS’ EQUITY As of December 31, 2025, the Company had the following: Common Stock Common Stock Class A Class B Shares authorized 9,000,000 1,000,000 Shares issued and outstanding 10 420,823 Voting rights 1 vote per share N/A Par value $ 0.00001 $ 0.0001 Preferred Stock Preferred Stock Series A Series B Shares authorized 5,500,000 3,000,000 Shares issued and outstanding 5,402,000 1,000,000 Voting rights N/A N/A Par value $ 0.00001 $ 0.00001 The Company has an approved stock-based compensation plan and grants its employees the option to purchase the Company’s Class B Common Stock with a par value of $0.0001. Under the stock option compensation plan, the Company may grant options for up to 1,000,000 shares of Class B Common Stock. The exercise price of each option is equal to $0.58 per share. The maximum term of the options is four years, and they vest over the maximum term of four years. As of December 31, 2025, 420,823 shares of common stock have been authorized and issued under this plan. The Company measures share-based awards at grant-date fair value in accordance with ASC 718 and recognizes compensation expense on a straight-line basis over the requisite service (vesting) period of the awards. The Company estimates expected forfeitures and revises those estimates when facts and circumstances indicate that the number of awards expected to vest will differ from previous estimates; any resulting cumulative adjustment is recognized in the current period and prior periods are not restated. There were no forfeitures during the year ended December 31, 2025. Grant-date fair values varied depending on the dates on which the units were granted. Share-based compensation expense recognized was $61,020 for the year ended December 31, 2025. As of December 31, 2025, total unrecognized compensation cost related to nonvested awards was $158,479, which is expected to be recognized over a weighted-average period of 2.6 years. - 17 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE I – INCOME TAXES The provisions for income taxes consist of the following components for the years ended December 31, 2025: Current: Federal $ 12,389,948 State and Local 1,517,350 $ 13,907,298 Deferred: Federal $ (213,956) State and Local (863,950) $ (1,077,906) Total provision for income taxes $ 12,829,392 As the Company operates in the cannabis industry, it is subject to the limitations of IRC Section 280E under which the Company is only allowed to deduct expense directly related to the sale of product. This results in permanent differences between ordinary and necessary business expenses deemed non-allowable under IRC Section 280E. Therefore, the effective tax rate can be highly variable and may not necessarily correlate with pre-tax income or loss. The Company’s total deferred tax liabilities and deferred tax assets at December 31, 2025 and 2024 were as follows: Deferred tax assets $ 1,102,202 Deferred tax liabilities 24,296 Net deferred tax assets $ 1,077,906 Deferred taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes. The differences relate primarily to accrued loyalties and the state net operating losses. The Company has state net operating loss carryforwards of approximately $5,978,000 as of December 31, 2025. These state net operating loss carryforwards give rise to deferred tax assets. Realization of these deferred tax assets is dependent upon the generation of sufficient taxable income in the applicable state jurisdictions prior to the expiration of the related carryforwards. Based on the weight of available evidence, management believes it is more likely than not that a portion of these state net operating loss carryforwards will be realized. Certain state net operating loss carryforwards are subject to various statutory limitations, including limitations arising from changes in ownership and other state-specific provisions, which may restrict the Company’s ability to fully utilize these carryforwards. The difference in actual tax expense and the expense that would be expected by applying the applicable federal statutory rate is primarily due to the state income taxes, deductions disallowed under 280E (as discussed above), and certain other nondeductible items. - 18 - Table of Contents EAZE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 2025 NOTE J – RISKS AND UNCERTAINTIES Banking Difficulties The Company currently maintains deposit accounts with a U.S. financial institution. However, the cultivation, sale, and use of marijuana is illegal under U.S. federal law. As a result, banking relationships in the cannabis industry are subject to heightened scrutiny and may be more difficult to establish and maintain than for businesses in other industries. There can be no assurance that the Company’s existing banking relationships will continue, that additional banking partners will be willing to provide services on terms acceptable to the Company, or that U.S. state or federal banking regulators will not more strictly enforce current prohibitions on handling funds generated from activities that are illegal under U.S. federal law. Any disruption, limitation, or termination of the Company’s access to customary banking or payment processing services could adversely affect the Company’s ability to conduct its operations and may have a material adverse effect on the Company. Litigation From time to time, the Company may be involved in litigation relating to claims arising out of operations in the normal course of business. As of December 31, 2025, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of the Company’s operations. There are also no proceedings in which any of the Company’s directors, officers or affiliates is an adverse party or has a material interest adverse to the Company’s interest. Compliance The Company’s operations are subject to a variety of local and state regulation. Failure to comply with one or more of those regulations could result in fines, restrictions on its operations, or losses of permits that could result in the Company ceasing operations. While management of the Company believes that the Company is in compliance with applicable local and state regulation as of December 31, 2025, cannabis regulations continue to evolve and are subject to differing interpretations. As a result, the Company may be subject to regulatory fines, penalties, or restrictions in the future. State laws that permit and regulate the production, distribution, and use of cannabis for adult use or medical purposes are in direct conflict with the Controlled Substances Act (21 U.S.C. § 811) (the “CSA”), which makes cannabis use and possession federally illegal. Although certain states and territories of the U.S. authorize medical and/or adult use cannabis production and distribution by licensed or registered entities, under U.S. federal law, the possession, use, cultivation, and transfer of cannabis and any related drug paraphernalia is illegal and any such acts are criminal acts under federal law under the CSA. Although the Company’s activities are believed to be compliant with applicable state and local laws, strict compliance with state and local laws with respect to cannabis may neither absolve the Company of liability under U.S. federal law, nor may it provide a defense to any federal proceeding which may be brought against the Company. Liquidity and Going Concern Management has evaluated the Company’s liquidity and its ability to continue as a going concern for the one ‑ year period following the date the financial statements are available to be issued. This evaluation considered the Company’s current financial condition, including available sources of liquidity and obligations coming due within that period, as well as events occurring subsequent to the balance sheet date related to the acquisition of the Company (see Note B – Subsequent Events). Based on this evaluation, management concluded that conditions and events, considered in the aggregate, do not raise substantial doubt about the Company’s ability to continue as a going concern for at least one year after the date the financial statements are available to be issued. - 19 -

Document text

EX-99.1 · vreof-20260331xex99d1.htm

EX-99.1
 3
 vreof-20260331xex99d1.htm
 EX-99.1

 Table of Contents
 Exhibit 99.1

 
 
 
 

 

 Table of Contents

 EAZE, INC. AND SUBSIDIARIES
 CONSOLIDATED FINANCIAL STATEMENTS
 TABLE OF CONTENTS
 
 

 

 
 Page

 
 

 INDEPENDENT AUDITOR’S REPORT
 1 - 2

 
 

 CONSOLIDATED FINANCIAL STATEMENTS:
 

 
 

 Consolidated Balance Sheet
 3

 
 

 Consolidated Statement of Operations
 4

 
 

 Consolidated Statement of Changes in Stockholders’ Equity
 5

 
 

 Consolidated Statement of Cash Flows
 6

 
 

 Notes to Consolidated Financial Statements
 7 - 19

 
 
 
 

 

 Table of Contents

 

 
 June 2, 2026
 To the Stockholders of
 Eaze, Inc. and Subsidiaries
 Edgewater, Colorado
 Independent Auditor’s Report
 Opinion
 We have audited the accompanying consolidated financial statements of Eaze, Inc. and Subsidiaries (the Company), which comprise the consolidated balance sheet as of December 31, 2025, and the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for the year then ended, and the related notes to the consolidated financial statements.
 In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Eaze, Inc. and Subsidiaries as of December 31, 2025, and the results of their operations and their cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.
 Basis for Opinion
 We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
 Emphasis of Matter
 As discussed in Note J to the consolidated financial statements, the Company operates in the cannabis industry which is legal in the State of Colorado, California, and Florida, but illegal under United States federal law. Our opinion is not modified with respect to this matter.
 Responsibilities of Management for the Consolidated Financial Statements
 Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
 In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued.
 
 

 HILL , BARTH & KING LLC | 301 YAMATO ROAD, SUITE 3130 | BOCA RATON, FL 33431 | TEL 239-263-2111 | FAX 239-263-0496 | HBKCPA.COM
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 Table of Contents

 Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
 Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.
 In performing an audit in accordance with generally accepted auditing standards, we:
 ● Exercise professional judgment and maintain professional skepticism throughout the audit.

 ● Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

 ● Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Accordingly, no such opinion is expressed.

 ● Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the consolidated financial statements.

 ● Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time.

 We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
 
 

 
 Certified Public Accountants

 
 
 

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 Table of Contents

 EAZE, INC. AND SUBSIDIARIES
 CONSOLIDATED BALANCE SHEET
 DECEMBER 31, 2025
 
 

 

 

 

 ASSETS
     
 
 

 
 
 
 

 CURRENT ASSETS
 
 
 

 Cash and cash equivalents
 
 $
 3,259,716

 Accounts receivable, net of allowance for credit losses of $497,418
 
  
 1,848,176

 Inventory
 
  
 11,428,335

 Prepaid expenses
 
  
 1,953,506

 Other current assets
 
  
 106,615

 TOTAL CURRENT ASSETS
 
  
 18,596,348

 
 
 
 

 PROPERTY AND EQUIPMENT, NET
 
  
 28,136,691

 
 
 
 

 OTHER ASSETS
 
  
   

 Right-of-use assets - operating
 
  
 33,398,798

 Right-of-use assets - finance
 
  
 3,636,308

 Intangibles, net
 
  
 15,661,186

 Other assets
 
  
 1,337,976

 Deferred tax asset
 
  
 1,077,906

 TOTAL ASSETS
 
 $
 101,845,213

 
 
 
 

 LIABILITIES AND STOCKHOLDERS' EQUITY
 
  
   

 
 
 
 

 CURRENT LIABILITIES
 
  
   

 Accounts payable
 
 $
 6,624,113

 Accrued expenses
 
  
 5,304,942

 Accrued taxes payable
 
  
 6,276,508

 Income taxes payable
 
  
 7,739,950

 Current portion of operating lease liabilities
 
  
 3,864,415

 Current portion of finance lease liabilities
 
  
 1,631,126

 Current portion of long-term debt
 
  
 5,227,708

 TOTAL CURRENT LIABILITIES
 
  
 36,668,762

 
 
 
 

 LONG-TERM LIABILITIES
 
  
   

 Operating lease liabilities, net of current portion
 
  
 33,203,198

 Finance lease liabilities, net of current portion
 
  
 1,395,880

 Uncertain tax position
 
  
 11,791,706

 Long-term debt, net of current portion
 
  
 2,230

 TOTAL LIABILITIES
 
  
 83,061,776

 
 
 
 

 STOCKHOLDERS’ EQUITY
 
  
 18,783,437

 
 
 $
 101,845,213

 
 See accompanying notes to consolidated financial statements
 

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 Table of Contents

 EAZE, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENT OF OPERATIONS
 YEAR ENDED DECEMBER 31, 2025
 
 

 

 

 

 OPERATING INCOME
     
 
 

 Sales
 
 $
 141,140,072

 Cost of goods sold
 
  
 82,148,802

 GROSS PROFIT
 
  
 58,991,270

 
 
 
 

 OPERATING EXPENSES
 
  
 69,605,575

 LOSS FROM OPERATIONS
 
  
 (10,614,305)

 
 
 
 

 OTHER INCOME (EXPENSE)
 
  
   

 Interest income
 
  
 107

 Interest expense
 
  
 (353,056)

 Other income
 
  
 602,451

 Other expense
 
  
 (929,082)

 
 
  
 (679,580)

 LOSS BEFORE PROVISION FOR INCOME TAXES
 
  
 (11,293,885)

 
 
 
 

 PROVISION FOR INCOME TAXES
 
  
 12,829,392

 NET LOSS
 
 $
 (24,123,277)

 
 See accompanying notes to consolidated financial statements
 

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 Table of Contents

 EAZE, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY
 YEAR ENDED DECEMBER 31, 2025
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 Common Stock
 
 Preferred Stock
 
 Additional
     
 Accumulated
 
 
 

 
     
 Class A
     
 Class B
     
 Series A
     
 Series B
     
 Paid-in Capital
     
 Deficit
     
 Total

 Balance, December 31, 2024
 
 $
 —
 
 $
 4
 
 $
 54,020,000
 
 $
 10,000,000
 
 $
 24,578
 
 $
 (21,198,888)
 
 $
 42,845,694

 Stock-based compensation
 
  
 —
 
  
 —
 
  
 —
 
  
 —
 
  
 61,020
 
  
 —
 
  
 61,020

 Net loss
 
  
 —
 
  
 —
 
  
 —
 
  
 —
 
  
 —
 
  
 (24,123,277)
 
  
 (24,123,277)

 Balance, December 31, 2025
 
 $
 —
 
 $
 4
 
 $
 54,020,000
 
 $
 10,000,000
 
 $
 85,598
 
 $
 (45,322,165)
 
 $
 18,783,437

 
 See accompanying notes to consolidated financial statements
 

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 Table of Contents

 EAZE, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENT OF CASH FLOWS
 YEAR ENDED DECEMBER 31, 2025
 
 

 

 

 

 CASH FLOWS FROM OPERATING ACTIVITIES
     
 
 

 Net loss
 
 $
 (24,123,277)  

 Adjustments to reconcile net loss to net cash used in by operating activities:
 
  
   

 Depreciation
 
  
 5,039,829

 Amortization
 
  
 1,320,809

 Amortization of operating right-of-use assets
 
  
 4,130,501

 Amortization of finance right-of-use assets
 
  
 1,125,091

 Provision for credit losses
 
  
 203,251

 Compensation expense related to stock-based awards
 
  
 61,020

 Paid-in-kind interest
 
  
 218,496

 Deferred income tax benefit
 
  
 (781,559)

 Changes in assets and liabilities:
 
  
   

 Accounts receivable
 
  
 (485,849)

 Inventory
 
  
 1,288,871

 Prepaid expenses
 
  
 71,099

 Other current assets
 
  
 (38,005)

 Intangible assets
 
  
 (2,738,637)

 Other assets
 
  
 (443,606)

 Accounts payable
 
  
 (1,564,302)

 Accrued expenses
 
  
 951,331

 Accrued taxes payable
 
  
 (881,741)

 Income taxes payable
 
  
 2,117,004

 Uncertain tax position
 
  
 11,791,706

 Operating lease payments
 
  
 (4,249,994)

 NET CASH USED IN OPERATING ACTIVITIES
 
  
 (6,987,962)

 
 
 
 

 CASH FLOWS FROM INVESTING ACTIVITIES
 
  
   

 Purchase of property and equipment, net
 
  
 (1,099,770)

 NET CASH USED IN INVESTING ACTIVITIES
 
  
 (1,099,770)

 
 
 
 

 CASH FLOWS FROM FINANCING ACTIVITIES
 
  
   

 Principal payments under finance lease obligations
 
  
 (1,439,491)

 Borrowings on long-term debt
 
  
 5,000,000

 Repayment of principal portion of long-term debt
 
  
 (1,433,043)

 NET CASH PROVIDED BY FINANCING ACTIVITIES
 
  
 2,127,466

 
 
 
 

 NET DECREASE IN CASH AND CASH EQUIVALENTS
 
  
 (5,960,266)

 
 
 
 

 CASH AND CASH EQUIVALENTS
 
  
   

 Beginning of year
 
  
 9,219,982

 End of year
 
 $
 3,259,716

 
 
 
 

 SUPPLEMENTARY CASH FLOW INFORMATION
 
  
   

 Cash paid for interest
 
 $
 353,056

 Interest paid-in kind
 
 $
 218,496

 
 
 
 

 
 See accompanying notes to consolidated financial statements
 

 - 6 -

 Table of Contents

 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2025
 
 NOTE A – NATURE OF OPERATIONS
 Eaze, Inc. (the Company) is a corporation that was formed and began operations on August 6, 2024, under the laws of the State of Delaware. The Company is engaged in the business of cultivating, manufacturing, and selling medicinal and adult-use cannabis products in Colorado, California, and Florida.
 On August 21, 2024, Eaze, Inc. and Subsidiaries entered into an agreement and plan of acquisition (the Acquisition) with Eaze Technologies, Inc. and its subsidiaries, pursuant to which Eaze, Inc. and Subsidiaries would acquire all assets and liabilities of Eaze Technologies, Inc. and its subsidiaries.
 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Basis of Presentation
 The Company’s consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”). The summary of significant accounting policies presented below is designed to assist in understanding the Company’s consolidated financial statements. Such consolidated financial statements and accompanying notes are the representations of management, who is responsible for their integrity and objectivity.
 Basis of Consolidation
 The consolidated financial statements include the accounts of Eaze, Inc. and its subsidiaries, Eaze Colorado, LLC, Eaze California, LLC, and Eaze Florida, LLC.
 Cash and Cash Equivalents
 The Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. The Company has no cash equivalents as of December 31, 2025 .
 Credit Risk
 The Company maintains cash balances at financial institutions in excess of federally insured limits from time to time. The Company has experienced no loss due to this concentration.
 Significant Accounting Judgments, Estimates, and Assumptions
 The preparation of consolidated financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, and revenue and expenses. Actual results may differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.
 
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 Accounts Receivable and Allowance for Credit Losses
 The Company’s accounts receivable are primarily due from wholesale customers. Credit is extended to customers based on an evaluation of each customer’s creditworthiness and financial condition; collateral is not required. The Company maintains allowances for credit losses, returns and discounts. The Company evaluates the collectability of its accounts receivable based on a combination of prospective factors. The allowance for credit losses is based on the aging of such receivables and any known specific collectability exposures as well as financial stability of its customers. Accounts are written off when deemed uncollectible. It is reasonably possible that the Company’s estimate of the allowance for credit losses will change.
 

 

 

 

 
     
 2025

 Beginning balance
 
 $
 415,453

 Current provision
 
  
 203,251

 Write-offs
 
  
 (121,286)

 Ending balance
 
 $
 497,418

 
 Inventory
 Inventories are valued at the lower of cost or market. Inventory consists primarily of raw materials, work-in-process, and finished goods. Due to state and federal regulations, the Company tracks its cannabis products including raw materials from seed to finished goods. Work-in-process consists of raw materials, direct labor, and related production overhead.
 Costs incurred during the production process are capitalized as incurred to the extent that cost is less than net realizable value. These costs include materials, labor and manufacturing overhead used in the production processes. Inventories of purchased finished goods and packing materials are initially valued at cost and subsequently at the lower of cost or net realizable value.
 Net realizable value is determined by the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. Cost is determined using the weighted average cost basis and is a significant estimate. Products for resale and supplies and consumables are valued at lower of cost or net realizable value. The Company reviews inventory for obsolete, redundant, and slow-moving goods and any such inventories are written down to net realizable value. As of December 31, 2025 , there were no reserves for obsolete inventories.
 Prepaid Expenses
 The Company pays for certain expenses in advance of receipt of goods or services. The amount is expensed over the term of contract or period for which the expenses are incurred, using the straight-line method.
 Property and Equipment
 Property and equipment are recorded at cost, including capitalized borrowing costs, net of depreciation. Expenditures for ordinary repairs and maintenance are charged to expense as incurred. Expenditures that materially increase the life of the assets are capitalized. Depreciation is computed using the straight-line method over the assets’ estimated useful life.
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 Property and Equipment (Continued)
 Asset classes and their respective useful lives are as follows:
 

 

 

 
    
 Life (years)

 Buildings
  
 30

 Leasehold improvements
  
 5-15

 Computers and equipment
  
 5-15

 Vehicles
  
 5

 Furniture and fixtures
  
 5

 
 The assets’ residual values, useful lives and methods of depreciation are reviewed at each financial year-end and adjusted prospectively if appropriate. An item of equipment is derecognized upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying value of the asset) is included in operations in the year the asset is derecognized.
 Leased Assets
 The Company leases equipment and real property for retail stores and cultivation facilities. The Company determines if an arrangement is a lease at inception.
 ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The ROU assets also include any lease payments made and exclude lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments are recognized on a straight-line basis over the lease term.
 The lease agreements do not contain any material residual value guarantees or material restrictive covenants. Additionally, for real property leases, the Company applies a portfolio approach to effectively account for the operating lease ROU assets and liabilities.
 Intangible Assets
 The Company’s intangible assets consist of a Medical Marijuana Treatment Center (“MMTC”) license for the State of Florida, which is classified as an indefinite ‑ lived intangible asset, and tradenames and technology, which are classified as finite ‑ lived intangible assets with estimated useful lives of twelve years and five years, respectively. Finite ‑ lived intangible assets are amortized on a straight ‑ line basis over their estimated useful lives and are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable, in accordance with the guidance for long ‑ lived assets. Indefinite ‑ lived intangible assets are not amortized but are tested for impairment at least annually, or more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. In performing the annual impairment assessment for indefinite ‑ lived intangible assets, the Company may first perform a qualitative assessment to determine whether it is more likely than not that the asset is impaired; if, based on this assessment, it is more likely than not that the asset is impaired, or if the Company elects to bypass the qualitative assessment, the Company estimates the fair value of the asset and records an impairment loss for any excess of the carrying amount over its fair value.

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 Revenue Recognition
 Revenue is recognized by the Company in accordance with FASB Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606). Through application of the standard, the Company recognizes revenue to depict the transfer of promised goods or services to the customer in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.
 In order to recognize revenue under ASC 606, the Company applies the following five (5) steps:
 ● Identify a customer along with a corresponding contract;

 ● Identify the performance obligation(s) in the contract to transfer goods or provide distinct services to a customer;

 ● Determine the transaction price the Company expects to be entitled to in exchange for transferring promised goods or services to a customer;

 ● Allocate the transaction price to the performance obligation(s) in the contract;

 ● Recognize revenue when or as the Company satisfies the performance obligation(s).

 Revenues consist of wholesale and retail sales of cannabis, which are recognized upon satisfaction of the performance obligation, which occurs at a point in time when control over the goods have been transferred to the customer and is recorded net of sales discounts. Payment is typically due upon transferring the goods to the customer or within a specified time period permitted under the Company’s credit policy.
 The Company generates advertising revenue primarily from selling advertising placements on its digital platforms and other media to cannabis and non ‑ cannabis brands. The Company accounts for revenue from contracts with customers in accordance with ASC 606, Revenue from Contracts with Customers. Advertising contracts typically specify the nature of the advertising services (such as display impressions, sponsored content, or campaign packages), the campaign period, and the pricing, which may be based on a cost ‑ per ‑ impression, cost ‑ per ‑ click, fixed fee, or other usage ‑ based metric. The Company identifies a contract with a customer when it is approved, each party’s rights and payment terms are identified, the contract has commercial substance, and it is probable that the Company will collect substantially all consideration to which it will be entitled in exchange for the advertising services to be transferred.
 The Company’s advertising services generally represent a single performance obligation to provide access to the Company’s advertising inventory and deliver the purchased impressions or other agreed ‑ upon advertising units over the campaign term. For impression ‑ or click ‑ based arrangements, the transaction price is generally variable because it is based on the number of impressions served or clicks delivered. The Company estimates the transaction price, including variable consideration, using the expected value method and applies the constraint on variable consideration where applicable, considering the potential for credits, make ‑ goods, and similar adjustments. The transaction price is allocated to the single performance obligation and revenue is recognized over time as the advertisements are delivered, generally based on the number of impressions or other measurable outputs delivered during the reporting period relative to the total contracted units.
 Advertising Costs
 Advertising and marketing costs are expensed as incurred. During the year ended December 31, 2025, the Company incurred advertising and marketing costs totaling $3,143,109.
 Share Based Compensation
 The Company awards stock options and restricted stock units (“RSUs”) to board members, officers, and certain management employees of the Company. All share-based payments are measured using a fair-value based method. The Company accounts for forfeitures as they occur. Share based compensation costs are recognized in the consolidated statement of operations using the graded-vesting method over the award term.

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 Share Based Compensation (Continued)
 Stock Options:
 The fair value of stock options is estimated using the Black-Scholes option pricing model. Assumptions used in the model include:
 ● Expected term - the expected term represents the period of time in years that options granted are expected to be outstanding and is computed using the simplified method as the Company has insufficient historical information regarding its stock options to provide a basis for an estimate.

 ● Expected volatility - the Company estimates expected volatility using the historical volatility of the Company. In cases where there is insufficient trading history, the expected volatility is estimated using the historical volatility of other companies that the Company considers comparable that have trading and volatility history prior to the Company becoming public.

 ● Expected annual rate of dividends - is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future.

 ● Risk free annual interest rate - based on the United States bond yield rate at the time of grant using the expected term of the award.

 Restricted Stock Units:
 Restricted Stock Units (“RSUs”) represent a right to receive a single Subordinate Voting Share that is both non-transferable and forfeitable unless and until certain conditions are satisfied. The fair value of RSUs is determined by the fair market value of the Company’s common stock on the grant date.
 Income Taxes
 The Company uses the asset and liability method to account for income taxes. Deferred income tax assets and liabilities are determined based on enacted tax rates and laws for the years in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.
 Significant judgment is required in evaluating the Company’s uncertain tax positions and determining the provision for income taxes. The Company recognizes benefits from uncertain tax positions based on the cumulative probability method whereby the largest benefit with a cumulative probability of greater than 50% is recorded. An uncertain tax position is not recognized if it has a 50% or less likelihood of being sustained. Recognition or measurement is reflected in the period in which the likelihood changes. Any interest and penalties related to unrecognized tax liabilities are recorded in provision for income taxes on the consolidated statements of operations.
 The IRS has taken the position that IRC section 280E prevents cannabis companies from deducting any business expenses other than those included in the cost of goods sold.
 Eaze Colorado, LLC, Eaze California, LLC, and Eaze Florida, LLC are disregarded entities for U.S. federal and state income tax. Therefore, no provision for income taxes related to these subsidiaries have been included in the consolidated financial statements.
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 Variable Interest Entities
 Under an expanded optional private company alternative established in ASU No. 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities, a private company (i.e., the reporting entity) may elect not to apply Variable Interest Entity (VIE) guidance to legal entities under common control (including common control leasing arrangements) if both the parent and the legal entity being evaluated for consolidation are not public business entities.
 Effectively, this private company accounting alternative, which covers all common control arrangements meeting certain conditions, expands the scope of the alternative allowing private companies not to apply the VIE guidance to qualifying common control leasing arrangements, which was established in ASU No. 2014-07, Consolidation (Topic 810): Applying Variable Interest Entities Guidance to Common Control Leasing Arrangements. Accordingly, ASU No. 2018-17 supersedes the alternative covering only leasing arrangements.
 The optional accounting alternative, pursuant to which a private company (i.e., the reporting entity) is not required to apply VIE guidance to a legal entity, may be used if all of the following criteria are met:
 ● The reporting entity and the legal entity are under common control.

 ● The reporting entity and the legal entity are not under common control of a public business entity.

 ● The legal entity under common control is, itself, not a public business entity.

 ● The reporting entity does not otherwise directly or indirectly have a controlling financial interest in the legal entity.

 The Company has determined that its subsidiary, Hometown Hearts, Inc. (“Hometown Hearts”), is a variable interest entity (“VIE”) under ASC 810-10-15-14 through 15-17 because the equity investors at risk, as a group, lack substantive power over the activities that most significantly affect Hometown Hearts’ economic performance and do not hold the substantive economics of the entity; substantially all significant operating activities and economic interests are directed to, and borne by, the Company through a management services agreement and related support arrangements.
 The Company, through its involvement with Hometown Hearts, including the management services agreement, has both (i) the power to direct the activities that most significantly affect Hometown Hearts’ economic performance and (ii) the obligation to absorb losses of, and the right to receive benefits from, Hometown Hearts that could potentially be significant, and therefore is the primary beneficiary of Hometown Hearts under ASC 810-10-25-38A through 25-38J.
 Accordingly, the Company consolidates 100% of Hometown Hearts’ assets, liabilities, revenues, expenses and cash flows in these consolidated financial statements in accordance with ASC 810-10.
 The carrying amounts and classification of Hometown Hearts’ consolidated assets and liabilities are included within the respective line items in the Company’s consolidated balance sheet, and those assets and liabilities are subject to the same accounting policies as the Company’s other consolidated subsidiaries, with additional disclosure provided in this note to meet the qualitative and quantitative disclosure objectives of ASC 810-10-50-2AA and 50-3, including the significant judgments and assumptions made in reaching the conclusion that the Company is the primary beneficiary and the nature of, and risks associated with, the Company’s involvement with Hometown Hearts.
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 Subsequent Events
 Management evaluated all activity of the Company through June 2, 2026, the date the consolidated financial statements were available to be issued, and concluded that no subsequent events have occurred that would require recognition or disclosure in the consolidated financial statements or notes, with exception of the following:
 Subsequent to the December 31, 2025, on April 23, 2026, the U.S. Department of Justice issued a final order under the Controlled Substances Act that reclassifies certain marijuana ‑ related products and materials associated with medical marijuana from Schedule I to Schedule III, while leaving other marijuana material classified in Schedule I. This change follows a scientific and medical recommendation from the U.S. Department of Health and Human Services that marijuana be rescheduled to Schedule III. The Company operates in the cannabis industry and is subject to federal, state, and local regulation. The reclassification is expected to impact the Company’s operations, regulatory compliance requirements, and income tax position, including the applicability of Internal Revenue Code Section 280E to certain of the Company’s activities. Management is currently evaluating the effects of this change in federal law on the Company’s business, financial position, results of operations, and cash flows, including potential changes in income tax accounting. At this time, the Company is unable to reasonably estimate the quantitative impact of this subsequent event on its consolidated financial statements. The accompanying consolidated financial statements do not reflect any adjustments related to this event, as the change in classification occurred after the balance sheet date and relates to conditions that did not exist at that date.
 On April 1, 2026, the Company entered into a definitive agreement with Vireo Growth Inc to purchase substantially all of the assets and membership interest of the Company. Closing is subject to certain shareholder and regulatory approvals.
 NOTE C – INVENTORY
 Inventory as of December 31, 2025 consisted of the following:
 

 

 

 

 Raw materials
    
 $
 461,417

 Work-in-process
 
  
 2,560,241

 Finished goods
 
  
 8,406,677

 Total
 
 $
 11,428,335

 
 
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE D – PROPERTY AND EQUIPMENT
 Net property and equipment as of December 31, 2025 consisted of the following:
 

 

 

 

 Computers and equipment
     
 $
 6,771,154

 Furniture and fixtures
 
  
 66,098

 Vehicles
 
  
 128,284

 Leasehold improvements
 
  
 26,015,663

 Construction in progress
 
  
 1,063,067

 
 
  
 34,044,266

 Less accumulated depreciation
 
  
 5,907,575

 Property and equipment, net
 
 $
 28,136,691

 
 Depreciation expense totaled $5,039,829 of which $2,824,551 was included in cost of goods sold, for the year ended December 31, 2025.
 NOTE E – LEASES
 The Company maintains operating and finance leases for equipment, vehicles, retail space, and manufacturing facilities, with remaining lease terms ranging from one to ten years.
 For the year ended December 31, 2025 , the components of lease expense were as follows:
 

 

 

 

 Operating lease cost
     
 $
 11,425,702

 
 
 
 

 Finance lease cost:
 
  
   

 Amortization of right-of-use assets
 
 $
 1,125,091

 Interest on lease liabilities
 
  
 505,037

 Total finance lease cost
 
 $
 1,630,128

 
 As of December 31, 2025, other information related to leases was as follows:
 

 

 

 

 

 Weighted Average Remaining Lease Term
     
 
   
 

 Operating leases
  
 
 6.47
 

 Finance leases
  
 
 2.08
 

 
 
 
 
 

 Weighted Average Discount Rate
  
 
   
 

 Operating leases
  
 
 18.30
 %

 Finance leases
  
 
 12.56
 %

 
 
 
 
 

 Right-of-use assets obtained in exchange for lease obligations:
  
 
   
 

 Operating leases
 
 $
 721,765
 

 
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE E – LEASES (CONTINUED)
 The maturity of the contractual undiscounted lease liabilities at December 31, 2025 is as follows:
 

 

 

 

 

 

 

 
     
 Operating
     
 Finance

 
 
 Leases
 
 Leases

 2026
 
 $
 10,328,871
 
 $
 1,928,918

 2027
 
  
 9,509,972
 
  
 1,379,684

 2028
 
  
 9,062,065
 
  
 87,635

 2029
 
  
 8,935,158
 
  
 18,447

 2030
 
  
 8,702,939
 
  
 —

 Thereafter
 
  
 22,808,726
 
  
 —

 Total future minimum lease payments
 
  
 69,347,731
 
  
 3,414,684

 Less imputed interest
 
  
 32,280,118
 
  
 387,678

 Total
 
 $
 37,067,613
 
 $
 3,027,006

 
 
 NOTE F – INTANGIBLE ASSETS
 Intangible assets are recorded at cost less accumulated amortization and impairment losses, if any. Intangible assets acquired in a business combination are measured at fair value at the acquisition date. Amortization of definite life intangibles is provided on a straight-line basis over their estimated useful lives. The estimated useful lives, residual values, and amortization methods are reviewed at each year end, and any changes in estimates are accounted for prospectively.
 Intangible assets as of December 31, 2025, are summarized as follows:
 

 

 

 

 

 

 

 

 

 

 
     
 Licenses
     
 Tradenames
     
 Technology

 Cost
 
 
 
 
 
 
 
 
 

 Balance as of January 1, 2025
 
 $
 7,000,000
 
 $
 3,589,000
 
 $
 3,985,251

 Purchases
 
  
 —
 
  
 —
 
  
 2,738,637

 Balance as of December 31, 2025
 
  
 7,000,000
 
  
 3,589,000
 
  
 6,723,888

 
 
 
 
 
 
 
 
 
 

 Accumulated Amortization
 
  
   
 
  
   
 
  
   

 Balance as of January 1, 2025
 
  
 —
 
  
 (99,693)
 
  
 (231,200)

 Amortization
 
  
 —
 
  
 (299,083)
 
  
 (1,021,726)

 Balance as of December 31, 2025
 
  
 —
 
  
 (398,776)
 
  
 (1,252,926)

 
 
 
 
 
 
 
 
 
 

 Net Book Balance
 
  
   
 
  
   
 
  
   

 Balance as of January 1, 2025
 
  
 7,000,000
 
  
 3,489,307
 
  
 3,754,051

 Balance as of December 31, 2025
 
 $
 7,000,000
 
 $
 3,190,224
 
 $
 5,470,962

 
 The Company recorded amortization expense of $1,320,809 for the year ended December 31, 2025. Amortization periods of assets with finite lives are based on management’s estimates at the date of acquisition.
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE G – LONG-TERM DEBT
 The Company entered into a promissory note agreement with a lender under which the lender committed to purchase secured notes in an aggregate principal amount of up to $5,000,000 (the “Facility”). The Company issued an initial secured note in the principal amount of $1,500,000 (the “Secured Note”) to the lender on that date and received cash proceeds of $1,500,000. As of December 31, 2025, the outstanding principal balance of the Secured Note was $1,500,000.
 The Secured Note bears interest at a fixed rate of 15.0% per annum on the outstanding principal balance. Interest is payable on the first business day of each month (each, a “Payment Date”) and is generally paid in kind (“PIK Interest”) by being added to the principal amount of the Secured Note, after which interest accrues on the increased principal balance; the Company may elect on any Payment Date to pay some or all of such interest in cash instead of having it capitalized. Upon the occurrence and during the continuance of an event of default, the lender may, at its option, increase the interest rate by 5 percentage points per annum.
 The Secured Note matures on June 30, 2026 (the “Maturity Date”). On the earlier of the Maturity Date or the consummation of a change of control (as defined in the agreement), the Company is required to repay in full the then ‑ outstanding principal amount of the Secured Note, all accrued and unpaid interest, and all other amounts then due under the promissory note agreement and related documents. The Company may redeem (prepay) the Secured Note, in whole or in part, at any time upon at least 10 business days’ prior written notice to the lender at a price equal to the principal amount being prepaid plus accrued and unpaid interest to the redemption date and any other amounts then due.
 The Secured Note is secured by a first ‑ priority security interest in substantially all of the personal property and other assets of the Company and the other issuer entities party to the agreement, including, among other things, accounts, deposit accounts and cash, equipment, inventory, general intangibles, investment property, and the proceeds of the foregoing (the “Collateral”). In addition, the Company is required, upon the formation or acquisition of any U.S. ‑ organized subsidiary, to cause such subsidiary to guarantee the obligations under the Facility and to grant the lender a first ‑ priority security interest in substantially all of its assets.
 Disclosure of assets pledged as security for loans is required by ASC 440 ‑ 10 ‑ 50 ‑ 1. The promissory note agreement contains customary affirmative and negative covenants, including, among others, requirements to provide monthly and quarterly financial statements, to comply in all material respects with applicable laws, restrictions on certain changes in the Company’s legal name, entity type, jurisdiction of organization, or principal place of business, restrictions on changes of control while obligations or unfunded commitments are outstanding, and limitations on the use of proceeds (including prohibitions on transferring or investing loan proceeds in non ‑ U.S. subsidiaries).
 Events of default include, among others, failure to pay amounts when due and certain bankruptcy or insolvency events, upon which the lender may accelerate the Secured Note and exercise remedies against the Collateral. The Company was in compliance with the covenants of the Secured Note as of December 31, 2025.
 Maturities related to long-term debt are as follows:
 

 

 

 

 2026
     
 $
 5,227,708

 2027
  
 
 2,230

 Total
 
 $
 5,229,938

 
 
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE H – STOCKHOLDERS’ EQUITY
 As of December 31, 2025, the Company had the following:
 

 

 

 

 

 

 

 
     
 Common Stock
     
 Common Stock

 
 
 Class A
 
 Class B

 Shares authorized
  
 
 9,000,000
  
 
 1,000,000

 Shares issued and outstanding
  
 
 10
  
 
 420,823

 Voting rights
  
 
 1 vote per share
  
 
 N/A

 Par value
 
 $
 0.00001
 
 $
 0.0001

 
 

 

 

 

 

 

 

 
     
 Preferred Stock
     
 Preferred Stock

 
 
 Series A
 
 Series B

 Shares authorized
  
 
 5,500,000
  
 
 3,000,000

 Shares issued and outstanding
  
 
 5,402,000
  
 
 1,000,000

 Voting rights
  
 
 N/A
  
 
 N/A

 Par value
 
 $
 0.00001
 
 $
 0.00001

 
 The Company has an approved stock-based compensation plan and grants its employees the option to purchase the Company’s Class B Common Stock with a par value of $0.0001. Under the stock option compensation plan, the Company may grant options for up to 1,000,000 shares of Class B Common Stock. The exercise price of each option is equal to $0.58 per share. The maximum term of the options is four years, and they vest over the maximum term of four years. As of December 31, 2025, 420,823 shares of common stock have been authorized and issued under this plan.
 The Company measures share-based awards at grant-date fair value in accordance with ASC 718 and recognizes compensation expense on a straight-line basis over the requisite service (vesting) period of the awards. The Company estimates expected forfeitures and revises those estimates when facts and circumstances indicate that the number of awards expected to vest will differ from previous estimates; any resulting cumulative adjustment is recognized in the current period and prior periods are not restated. There were no forfeitures during the year ended December 31, 2025. Grant-date fair values varied depending on the dates on which the units were granted. Share-based compensation expense recognized was $61,020 for the year ended December 31, 2025. As of December 31, 2025, total unrecognized compensation cost related to nonvested awards was $158,479, which is expected to be recognized over a weighted-average period of 2.6 years.
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE I – INCOME TAXES
 The provisions for income taxes consist of the following components for the years ended December 31, 2025:
 

 

 

 

 Current:
     
 
 

 Federal
 
 $
 12,389,948

 State and Local
 
  
 1,517,350

 
 
 $
 13,907,298

 Deferred:
 
 
 

 Federal
 
 $
 (213,956)

 State and Local
 
  
 (863,950)

 
 
 $
 (1,077,906)

 
 
 
 

 Total provision for income taxes
 
 $
 12,829,392

 
 As the Company operates in the cannabis industry, it is subject to the limitations of IRC Section 280E under which the Company is only allowed to deduct expense directly related to the sale of product. This results in permanent differences between ordinary and necessary business expenses deemed non-allowable under IRC Section 280E. Therefore, the effective tax rate can be highly variable and may not necessarily correlate with pre-tax income or loss.
 The Company’s total deferred tax liabilities and deferred tax assets at December 31, 2025 and 2024 were as follows:
 

 

 

 

 Deferred tax assets
     
 $
 1,102,202

 Deferred tax liabilities
 
  
 24,296

 Net deferred tax assets
 
 $
 1,077,906

 
 Deferred taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes. The differences relate primarily to accrued loyalties and the state net operating losses.
 The Company has state net operating loss carryforwards of approximately $5,978,000 as of December 31, 2025. These state net operating loss carryforwards give rise to deferred tax assets. Realization of these deferred tax assets is dependent upon the generation of sufficient taxable income in the applicable state jurisdictions prior to the expiration of the related carryforwards. Based on the weight of available evidence, management believes it is more likely than not that a portion of these state net operating loss carryforwards will be realized. Certain state net operating loss carryforwards are subject to various statutory limitations, including limitations arising from changes in ownership and other state-specific provisions, which may restrict the Company’s ability to fully utilize these carryforwards.
 The difference in actual tax expense and the expense that would be expected by applying the applicable federal statutory rate is primarily due to the state income taxes, deductions disallowed under 280E (as discussed above), and certain other nondeductible items.
 

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 Table of Contents
 EAZE, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
 DECEMBER 31, 2025

 
 NOTE J – RISKS AND UNCERTAINTIES
 Banking Difficulties
 The Company currently maintains deposit accounts with a U.S. financial institution. However, the cultivation, sale, and use of marijuana is illegal under U.S. federal law. As a result, banking relationships in the cannabis industry are subject to heightened scrutiny and may be more difficult to establish and maintain than for businesses in other industries. There can be no assurance that the Company’s existing banking relationships will continue, that additional banking partners will be willing to provide services on terms acceptable to the Company, or that U.S. state or federal banking regulators will not more strictly enforce current prohibitions on handling funds generated from activities that are illegal under U.S. federal law. Any disruption, limitation, or termination of the Company’s access to customary banking or payment processing services could adversely affect the Company’s ability to conduct its operations and may have a material adverse effect on the Company.
 Litigation
 From time to time, the Company may be involved in litigation relating to claims arising out of operations in the normal course of business. As of December 31, 2025, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of the Company’s operations. There are also no proceedings in which any of the Company’s directors, officers or affiliates is an adverse party or has a material interest adverse to the Company’s interest.
 Compliance
 The Company’s operations are subject to a variety of local and state regulation. Failure to comply with one or more of those regulations could result in fines, restrictions on its operations, or losses of permits that could result in the Company ceasing operations. While management of the Company believes that the Company is in compliance with applicable local and state regulation as of December 31, 2025, cannabis regulations continue to evolve and are subject to differing interpretations. As a result, the Company may be subject to regulatory fines, penalties, or restrictions in the future.
 State laws that permit and regulate the production, distribution, and use of cannabis for adult use or medical purposes are in direct conflict with the Controlled Substances Act (21 U.S.C. § 811) (the “CSA”), which makes cannabis use and possession federally illegal. Although certain states and territories of the U.S. authorize medical and/or adult use cannabis production and distribution by licensed or registered entities, under U.S. federal law, the possession, use, cultivation, and transfer of cannabis and any related drug paraphernalia is illegal and any such acts are criminal acts under federal law under the CSA. Although the Company’s activities are believed to be compliant with applicable state and local laws, strict compliance with state and local laws with respect to cannabis may neither absolve the Company of liability under U.S. federal law, nor may it provide a defense to any federal proceeding which may be brought against the Company.
 Liquidity and Going Concern
 Management has evaluated the Company’s liquidity and its ability to continue as a going concern for the one ‑ year period following the date the financial statements are available to be issued. This evaluation considered the Company’s current financial condition, including available sources of liquidity and obligations coming due within that period, as well as events occurring subsequent to the balance sheet date related to the acquisition of the Company (see Note B – Subsequent Events). Based on this evaluation, management concluded that conditions and events, considered in the aggregate, do not raise substantial doubt about the Company’s ability to continue as a going concern for at least one year after the date the financial statements are available to be issued.

 - 19 -

EX-99.2 · vreof-20260331xex99d2.htm

Type

EX-99.2

File

vreof-20260331xex99d2.htm

Document text
EX-99.2 · vreof-20260331xex99d2.htm EX-99.2 4 vreof-20260331xex99d2.htm EX-99.2 Exhibit 99.2 UNAUDITED PROFORMA CONDENSED COMBINED FINANCIAL INFORMATION As previously disclosed, on December 22, 2025, Vireo Growth Inc. (the “Company” or “Vireo”) entered into a merger agreement pursuant to which a wholly owned subsidiary of the Company would merge with and into Eaze, Inc. (“Eaze”), with Eaze surviving as a wholly owned subsidiary (the “Eaze Merger”). The Eaze Merger was completed on April 1, 2026. In connection with the closing of the Eaze Merger, the Company issued an aggregate of 90,379,591 subordinate voting shares as estimated closing consideration, of which a portion was delivered to a payment agent for distribution to former Eaze stockholders and a portion was placed into escrow. The estimated closing consideration is subject to customary post-closing adjustments, including adjustments for cash, indebtedness, transaction expenses, working capital and certain tax items. Former Eaze stockholders may also be entitled to receive additional subordinate voting shares in the form of earnout consideration based on the achievement of certain financial targets following December 31, 2026, subject to specified limitations. In addition, the Company issued RSUs to certain Eaze employees in connection with the Eaze Merger, including (i) fully vested RSUs issued at closing and (ii) additional RSUs that vest based on continued employment and are tied to the achievement of earnout-related performance conditions. The Eaze Merger was accounted for as a business combination in accordance with U.S. GAAP, with management concluding Vireo is the accounting acquirer. The following unaudited pro forma condensed combined financial information is based on the historical financial statements of Vireo and Eaze adjusted to give effect to the Eaze Merger. The following unaudited pro forma condensed combined financial information, has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release No. 33-10786 “Amendments to Financial Disclosures about Acquired and Disposed Businesses.” The following unaudited pro forma condensed combined financial information is based on the historical financial statements of Vireo and Eaze, both of which have December 31 fiscal year ends, as adjusted to give effect to the Eaze Merger. The unaudited proforma condensed combined balance sheet as of December 31, 2025 gives effect to the Eaze Merger as if it had occurred on December 31, 2025. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025 gives effect to the Eaze Merger as if it had occurred on January 1, 2025. The pro forma adjustments are based on available information and assumptions that management believes are reasonable. Included in the unaudited pro forma condensed combined financial information is an estimate of the consideration exchanged for Eaze, which is based on a purchase price allocation, which includes known information and preliminary estimates of fair value for certain equity instruments and contingent consideration. While this is management’s best estimate at this time, the valuation of these equity instruments and contingent consideration is still in progress and subject to change. All estimates and assumptions included in the unaudited pro forma condensed combined financial information could change significantly as management finalizes its assessment of the allocation and fair value of the net tangible and intangible assets acquired, most of which are dependent on the completion of valuations that will be performed by independent valuation specialists. The unaudited pro forma condensed combined financial information does not include adjustments to reflect any synergies or dis-synergies, any future operating efficiencies, associated costs savings or any possible integration costs that may occur related to the Eaze Merger. Actual results may be materially different from the unaudited proforma condensed combined financial information presented herein. The unaudited proforma condensed combined financial information does not necessarily reflect what the combined company’s financial condition or results of operations would have been had the Eaze Merger occurred on the dates indicated. The unaudited pro forma condensed combined financial information also may not be useful in predicting the future financial condition and results of operations of the combined company. The actual financial condition and results of operations of the combined company may differ significantly from the proforma amounts reflected herein due to a variety of factors, including differences in accounting policies, elections, and estimates, which while accounted for to the extent known, are still in process of being determined UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET AS OF DECEMBER 31, 2025 Transaction Accounting Pro Forma Vireo Eaze Adjustments Combined ASSETS Currents assets: Cash $ 102,229,759 $ 3,259,716 $ — $ 105,489,475 Restricted cash 20,265,212 — — 20,265,212 Marketable securities 1,020,243 — — 1,020,243 Accounts receivable, net 13,761,917 1,848,176 — 15,610,093 Income tax receivable 22,756,544 — — 22,756,544 Inventory 59,969,928 11,428,335 — 71,398,263 Prepayments and other current assets 3,896,577 2,060,121 — 5,956,698 Warrants held 1,684,691 — — 1,684,691 Notes receivable 79,226,015 — — 79,226,015 Assets held for sale 300,000 — — 300,000 Total current assets 305,110,886 18,596,348 — 323,707,234 Property and equipment, net 217,505,538 31,772,999 — 249,278,537 Operating lease right‑of‑use asset 53,368,204 33,398,798 — 86,767,002 Intangible assets, net 117,471,678 15,661,186 (15,661,186) B 117,471,678 Goodwill 87,534,561 — 6,460,400 B 93,994,961 Investments 6,000,000 — — 6,000,000 Deposits 4,390,559 — — 4,390,559 Indemnified tax assets 25,772,866 — 19,531,656 B 45,304,522 Deferred tax asset — 1,077,906 — 1,077,906 Other assets — 1,337,976 — 1,337,976 Total assets $ 817,154,292 $ 101,845,213 $ 10,330,870 $ 929,330,375 LIABILITIES Current Liabilities Accounts payable and accrued liabilities $ 50,254,506 $ 18,205,563 $ 1,309,445 A $ 69,769,514 Income taxes payable — 7,739,950 — 7,739,950 Convertible debt, current portion 1,300,000 — — 1,300,000 Long-term debt, current portion 16,290,000 5,227,708 (5,227,708) C 16,290,000 Operating right-of-use liability, current 3,556,576 3,864,415 — 7,420,991 Finance right-of-use liability, current — 1,631,126 — 1,631,126 Uncertain tax liability 119,954,000 11,791,706 — 131,745,706 Derivative liability 172,811 — — 172,811 Total current liabilities 191,527,893 48,460,468 (3,918,263) 236,070,098 Operating right-of-use liability, net of current portion 146,308,253 33,203,198 — 179,511,451 Finance right-of-use liability, net of current portion — 1,395,880 — 1,395,880 Long-term debt, net 127,644,855 2,230 (2,230) C 127,644,855 Convertible debt, net 8,600,000 — — 8,600,000 Contingent consideration 24,448,000 — — 24,448,000 Deferred tax liabilities 10,217,000 — — 10,217,000 Other long-term liabilities 983,299 — — 983,299 Total liabilities 509,729,300 83,061,776 (3,920,493) 588,870,583 STOCKHOLDERS’ EQUITY Subordinate Voting shares ($- par value, unlimited shares authorized; 1,057,131,571 shares issued and outstanding at December 31, 2025) — — — — Multiple Voting Shares ($- par value, unlimited shares authorized; 233,192 shares issued and outstanding at December 31, 2025) — — — — Common stock — 4 (4) B — Preferred stock - Series A and B — 64,020,000 (64,020,000) B — Additional paid in capital 606,974,461 85,598 (85,598) B 606,974,461 — — 34,344,245 B 34,344,245 Accumulated deficit (299,549,469) (45,322,165) 45,322,165 B (299,549,469) — — (1,309,445) A (1,309,445) Total stockholders’ equity 307,424,992 18,783,437 14,251,363 340,459,792 Total liabilities and stockholders’ equity $ 817,154,292 $ 101,845,213 $ 10,330,870 $ 929,330,375 UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2025 Transaction Accounting Pro Forma Vireo Eaze Adjustments Combined Revenue $ 268,769,268 $ 141,140,072 $ — $ 409,909,340 Cost of sales Product costs 122,009,304 82,148,802 — 204,158,106 Non-cash product costs 17,805,282 — — 17,805,282 Inventory valuation adjustments 1,859,305 — — 1,859,305 Gross profit 127,095,377 58,991,270 — 186,086,647 Operating expenses Selling, general and administrative expenses 81,186,632 67,272,297 — 148,458,929 Transaction related expenses 11,208,273 118,000 1,309,445 D 12,635,718 Stock-based compensation expenses 18,663,707 — 1,330,000 E 19,993,707 Depreciation 11,337,597 2,215,278 — 13,552,875 Amortization 5,747,651 — — 5,747,651 Total operating expenses 128,143,860 69,605,575 2,639,445 200,388,880 Loss from operations (1,048,483) (10,614,305) (2,639,445) (14,302,233) Other income (expense) Interest expense, net (15,905,534) (352,949) — (16,258,483) Interest expense on finance lease liabilities - Minnesota & New York (14,348,831) — — (14,348,831) Impairment of long-lived assets (2,600,000) — — (2,600,000) Gain (loss) on disposal of assets and debt (7,866,997) — — (7,866,997) Gain (loss) on change in the fair value of contingent consideration (9,617,000) — — (9,617,000) Derivative gain (loss) (172,811) — — (172,811) Other income (expense) 11,648,748 (326,631) — 11,322,117 Other income (expenses), net (38,862,425) (679,580) — (39,542,005) Loss before income taxes (39,910,908) (11,293,885) (2,639,445) (53,844,238) Deferred income taxes recoveries (expenses) 13,406,000 1,077,906 — 14,483,906 Current income tax expense (41,609,000) (13,907,298) — (55,516,298) Net loss and comprehensive loss (68,113,908) (24,123,277) (2,639,445) (94,876,630) Net loss per share - basic and diluted $ (0.09) — — $ (0.11) Weighted average shares used in computation of net loss per share - basic and diluted 734,738,785 — — 825,118,376 NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION Note 1. Basis of Presentation The unaudited pro forma condensed combined financial information represents the combined companies’ (Vireo and Eaze) unaudited pro forma condensed combined balance sheet as of December 31, 2025 and unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025. The unaudited pro forma condensed combined financial information is based on the historical financial statements of Vireo and Eaze, adjusted to give effect to the Eaze Merger, and should be read in conjunction with the historical financial statements from which they are derived. The unaudited pro forma condensed combined financial information is presented in United States dollars. The unaudited pro forma condensed combined balance sheet gives effect to the Eaze Merger as if it had occurred on December 31, 2025. The unaudited pro forma condensed combined statement of operations gives effect to the Eaze Merger as if it had occurred on January 1, 2025. In preparing the unaudited pro forma condensed combined balance sheet and unaudited pro forma condensed combined statement of operations, the following historical information was used: ● Vireo’s audited consolidated financial statements as of and for the year ended December 31, 2025, as filed with the SEC on March 17, 2026; and ● Eaze, Inc. and Subsidiaries’ audited consolidated financial statements as of and for the year ended December 31, 2025. The unaudited pro forma condensed combined balance sheet and unaudited pro forma condensed combined statement of operations should be read in conjunction with the historical financial statements including the notes thereto, as listed above. The unaudited pro forma condensed combined financial information has been prepared for illustrative purposes only and may not be indicative of the operating results or financial condition that would have been achieved if the Eaze Merger had been completed on the dates or for the period presented, nor do they purport to project the results of operations or financial position for any future period or as of any future date. The actual financial position and results of operations may differ materially from the pro forma amounts reflected herein due to a variety of factors. The unaudited pro forma condensed combined financial information does not reflect operational and administrative cost savings that may be achieved as a result of the Eaze Merger. Note 2. Accounting Policies and Reclassifications Subsequent to the consummation of the Eaze Merger, management has commenced a comprehensive review of the entities’ accounting policies. As a result of the review, management may identify differences between the accounting policies of the entities which, when conformed, could have a material impact on the financial statements of the post-combination company. Based on its initial analysis, management did not identify any differences that would have a material impact on the unaudited pro forma condensed combined financial information. As a result, the unaudited pro forma condensed combined financial information does not assume any differences in accounting policies. In preparing the unaudited pro forma condensed combined financial information, certain reclassifications were made to Eaze’s historical financial statement presentation to conform to Vireo’s presentation Note 3. Adjustments to Unaudited Pro Forma Condensed Combined Financial Information The unaudited pro forma condensed combined financial information has been prepared to illustrate the effect of the Eaze Merger and related transactions and has been prepared for informational purposes only. The following unaudited pro forma condensed combined financial information, has been prepared in accordance with Article 11 of Regulation S-X as amended. Vireo and the Eaze have not had any historical relationship prior to the Eaze Merger. Accordingly, no pro forma adjustments were required to eliminate activities between the companies. The pro forma basic and diluted net loss per share amount presented in the unaudited pro forma condensed combined statement of operations is based upon the pro forma number of shares of Vireo stock outstanding, assuming the Eaze Merger and related transactions occurred on January 1, 2025. The basic and diluted earnings per share has been calculated as of December 31, 2025, prior to Vireo’s reverse stock split, which was effective June 5, 2026. If the reverse stock split had occurred as of December 31, 2025, the pro forma weighted average shares used in computation of net loss per share - basic and diluted, would be 27,503,946. Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet The pro forma adjustments included in the unaudited pro forma condensed combined balance sheet as of December 31, 2025, are as follows: A Represents Vireo’s total estimated transaction costs not yet recorded in the 2025 historical financial statements, which include advisory, banking, legal and due diligence fees that were incurred in connection with the Eaze Merger. B Represents the following preliminary adjustments related to applying the acquisition method of accounting given the Eaze Merger is being accounted for as a business combination under Accounting Standards Codification (“ASC”) Topic 805, Business Combinations (“ASC 805”). Vireo has not completed its purchase price allocation and the amounts noted are preliminary. ● Issuance of Vireo’s Subordinated Voting Shares to Eaze as consideration transferred ● The recognition of acquired goodwill and intangible assets. The expected useful life and amortization period for the intangible and long-lived assets acquired is generally 15 years. ● The recognition of indemnified tax assets ● Elimination of the Eaze accumulated deficit balance and common and preferred stock balances to additional paid-in- capital. Refer to the table in Note 4 below for additional information related to these adjustments. C To remove liabilities not purchased pursuant to the Merger Agreement. Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations The pro forma adjustments included in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025, are as follows: D Represents estimated remaining transaction costs not already reflected in the December 31, 2025 historical financial statements of Vireo of $1,309,445 as if incurred on January 1, 2025, the date the Eaze Merger occurred for purposes of the unaudited pro forma condensed combined statement of operations. E Represents fully vested retention awards, further described below, granted to Eaze employees on the date of closing of the Merger valued at $0.38 for 3,500,000 restricted stock units (the “Closing RSUs”). Pursuant to the Merger Agreement, within 30 days following the closing of the transactions under the Merger Agreement, the Company will issue an aggregate of 3,500,000 Closing RSUs to certain employees of Eaze in consideration for such employees’ good faith efforts in connection with the closing of the transactions. Each Closing RSU will be fully vested as of the date of issuance. Note 4. Estimated Purchase Price Consideration The estimated preliminary purchase price allocation for the Eaze Merger and the corresponding aggregate Merger Consideration is presented in the table below as if the Eaze Merger closed on December 31, 2025. Following the close of the Eaze Merger on April 1, 2026, management prepared a preliminary purchase price allocation. The preliminary allocation is subject to revision as additional information becomes available regarding the fair values of the assets acquired and liabilities assumed during the measurement period. In general, due to the nature of certain assets acquired and liabilities assumed, the Company has preliminarily determined that the carrying value of those assets and liabilities as of December 31, 2025, approximate their fair value. Management has not finalized the purchase price allocation. Accordingly, the unaudited pro forma condensed combined financial information includes a preliminary allocation of the purchase price based on assumptions and estimates that, while considered reasonable under the circumstances, are subject to changes, and such changes may be material. Management will continue to refine its identification and valuation of assets acquired and liabilities assumed as further information becomes available. The final allocation is expected to be completed within twelve months of the Eaze Closing Date and could differ materially from the preliminary allocation used in the transaction accounting adjustments. The final allocation may include (1) changes in fair values of inventory and property and equipment; (2) changes in allocations to intangible assets, such as trade names, licenses, and customer relationships, as well as goodwill; (3) other changes to assets and liabilities; and (4) changes to consideration related to the valuation of contingent consideration. The estimated fair values of the components included in the purchase price consideration are preliminary and may materially vary from final results. The Company is still finalizing its conclusions on the accounting treatment associated with the components of the purchase consideration, along with the valuations and necessary calculations related to these components, as described in further detail below. Merger Consideration: Estimated Merger Consideration of $34,344,245 is based on the Company’s closing share price of $0.38 on April 1, 2026 multiplied by the number of Vireo Subordinate Voting Shares issued of 90,379,591. Contingent consideration Eaze EBITDA Earn-Out Shares: Pursuant to the Merger Agreement, subject to the terms and conditions of the Merger Agreement, former stockholders of Eaze may receive additional Subordinate Voting Shares pursuant to earnout payments following December 31, 2026 based on an EBITDA figure of $76,800,000, less the Base Consideration of $34,344,245, adjusted for certain items as described in the Earn-Out Amount in the Merger Agreement, including certain fees payable in connection with the above purchase price adjustment if not otherwise paid by the Stockholder Representative, certain equipment lease expenses, and tax items, and paid out using a share price for the Subordinate Voting Shares of the higher of $1.05 or the 20-day volume weighted average price of the Subordinate Voting Shares as of the trading day immediately prior to December 31, 2026. In no event shall the number of Subordinate Voting Shares issued in respect of earnout payments under the Merger Agreement exceed the number of shares issued as closing merger consideration under the Merger Agreement. The contingent consideration valuation has not been finalized; however, management’s current best estimate is there will be zero value. Identifiable Net Assets Acquired In connection with the Eaze Merger, the Company will recognize intangible assets as reflected in the table below. Goodwill will not be amortized, but instead will be tested for impairment at least annually or more frequently if certain indicators are present. In the event that the value of goodwill or other intangible assets become impaired in the future, an accounting charge for impairment would be recognized during the period in which the determination was made. The purchase price has been allocated to the net tangible and identifiable intangible assets and liabilities based on the respective estimated fair values and has not been finalized. The excess of the purchase price over the net tangible and identifiable intangible assets has been recorded as goodwill. Goodwill represents potential operational synergies, various expense synergies, and opportunities to enter new markets, and is assigned to the Company’s cultivation, production, and sale of cannabis business segment. Fair Value Components of total estimate purchase price consideration Merger consideration - Subordinate Voting Shares $ 34,344,245 Assets acquired Cash $ 3,259,716 Accounts receivable 1,848,176 Inventory 11,428,335 Prepayments and other current assets 2,060,121 Operating lease, right-of-use asset 33,398,798 Property and equipment 31,772,999 Indemnified tax assets 19,531,656 Deferred tax asset 1,077,906 Other assets 1,337,976 Total tangible assets 105,715,683 Goodwill 6,460,400 Total assets 112,176,083 Accounts payable and accrued liabilities (18,205,563) Income taxes payable (7,739,950) Right-of-use lease liabilities (40,094,619) Uncertain tax liability (11,791,706) Total liabilities assumed (77,831,838) Net assets acquired $ 34,344,245 Note 5. Net Loss per Share Net loss per share was calculated using the historical weighted average shares outstanding and the issuance of additional shares in connection with the Eaze Merger, assuming the shares were outstanding since January 1, 2025. As the Eaze Merger is being reflected as if it had occurred at the beginning of the period presented, the calculation of weighted average shares outstanding for basic and diluted net loss per share assumes that the shares issuable relating to the Eaze Merger have been outstanding for the entirety of the period presented. The basic and diluted earnings per share has been calculated as of December 31, 2025, prior to Vireo’s reverse stock split, which was effective June 5, 2026. If the reverse stock split had occurred as of December 31, 2025, the pro forma weighted average shares used in computation of net loss per share - basic and diluted, would be 27,503,946. For the Year Ended December 31, 2025 (1) Numerator: Pro forma net loss $ (94,876,630) Denominator: Weighted average shares outstanding - basic and diluted (2) 825,118,376 Net loss per share: Basic and diluted $ (0.11) Excluded securities (3): Stock options 34,712,901 Warrants 18,541,586 Restricted stock units 63,065,217 Shares issuable to convertible debt holders 15,920,000 Eaze contingent consideration (4) — (1) Pro forma net loss per share includes the related pro forma adjustments as referred to within the section “Unaudited Pro Forma Condensed Combined Financial Information. (2) The following is the calculation of the weight shares outstanding – basic and diluted. Weighted average shares used in computation of net loss per share - basic and diluted 734,738,785 Shares issued in acquisition (deemed outstanding for full year) 90,379,591 Weighted average shares outstanding 825,118,376 (3) The potentially dilutive outstanding securities were excluded from the computation of pro forma net loss per share, because their effect would have been anti-dilutive. (4) Represents shares that may potentially be issued to the former stockholders of Eaze under Item 2.01 of the Eaze Merger Agreement.

Document text

EX-99.2 · vreof-20260331xex99d2.htm

EX-99.2
 4
 vreof-20260331xex99d2.htm
 EX-99.2

 Exhibit 99.2
 UNAUDITED PROFORMA CONDENSED COMBINED FINANCIAL INFORMATION
 As previously disclosed, on December 22, 2025, Vireo Growth Inc. (the “Company” or “Vireo”) entered into a merger agreement pursuant to which a wholly owned subsidiary of the Company would merge with and into Eaze, Inc. (“Eaze”), with Eaze surviving as a wholly owned subsidiary (the “Eaze Merger”). The Eaze Merger was completed on April 1, 2026.
 In connection with the closing of the Eaze Merger, the Company issued an aggregate of 90,379,591 subordinate voting shares as estimated closing consideration, of which a portion was delivered to a payment agent for distribution to former Eaze stockholders and a portion was placed into escrow. The estimated closing consideration is subject to customary post-closing adjustments, including adjustments for cash, indebtedness, transaction expenses, working capital and certain tax items. Former Eaze stockholders may also be entitled to receive additional subordinate voting shares in the form of earnout consideration based on the achievement of certain financial targets following December 31, 2026, subject to specified limitations. In addition, the Company issued RSUs to certain Eaze employees in connection with the Eaze Merger, including (i) fully vested RSUs issued at closing and (ii) additional RSUs that vest based on continued employment and are tied to the achievement of earnout-related performance conditions.
 The Eaze Merger was accounted for as a business combination in accordance with U.S. GAAP, with management concluding Vireo is the accounting acquirer.
 The following unaudited pro forma condensed combined financial information is based on the historical financial statements of Vireo and Eaze adjusted to give effect to the Eaze Merger. The following unaudited pro forma condensed combined financial information, has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release No. 33-10786 “Amendments to Financial Disclosures about Acquired and Disposed Businesses.”
 The following unaudited pro forma condensed combined financial information is based on the historical financial statements of Vireo and Eaze, both of which have December 31 fiscal year ends, as adjusted to give effect to the Eaze Merger. The unaudited proforma condensed combined balance sheet as of December 31, 2025 gives effect to the Eaze Merger as if it had occurred on December 31, 2025. The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025 gives effect to the Eaze Merger as if it had occurred on January 1, 2025.
 The pro forma adjustments are based on available information and assumptions that management believes are reasonable. Included in the unaudited pro forma condensed combined financial information is an estimate of the consideration exchanged for Eaze, which is based on a purchase price allocation, which includes known information and preliminary estimates of fair value for certain equity instruments and contingent consideration. While this is management’s best estimate at this time, the valuation of these equity instruments and contingent consideration is still in progress and subject to change. All estimates and assumptions included in the unaudited pro forma condensed combined financial information could change significantly as management finalizes its assessment of the allocation and fair value of the net tangible and intangible assets acquired, most of which are dependent on the completion of valuations that will be performed by independent valuation specialists. The unaudited pro forma condensed combined financial information does not include adjustments to reflect any synergies or dis-synergies, any future operating efficiencies, associated costs savings or any possible integration costs that may occur related to the Eaze Merger. Actual results may be materially different from the unaudited proforma condensed combined financial information presented herein.
 The unaudited proforma condensed combined financial information does not necessarily reflect what the combined company’s financial condition or results of operations would have been had the Eaze Merger occurred on the dates indicated. The unaudited pro forma condensed combined financial information also may not be useful in predicting the future financial condition and results of operations of the combined company. The actual financial condition and results of operations of the combined company may differ significantly from the proforma amounts reflected herein due to a variety of factors, including differences in accounting policies, elections, and estimates, which while accounted for to the extent known, are still in process of being determined
 

 UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
 AS OF DECEMBER 31, 2025
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
     
     
 
     
     
 
     
 Transaction
     
     
     
     
 

 
 
 
 
 
 
 
 
 Accounting
 
 
 
 Pro Forma

 
 
 Vireo
 
 Eaze
 
 Adjustments
 
 
 
 Combined

 ASSETS
  
 
   
  
 
   
  
 
   
  
   
  
 
   

 Currents assets:
  
 
   
  
 
   
  
 
   
  
   
  
 
   

 Cash
 
 $
 102,229,759
 
 $
 3,259,716
 
 $
 —
  
   
 
 $
 105,489,475

 Restricted cash
 
  
 20,265,212
 
  
 —
 
  
 —
  
   
 
  
 20,265,212

 Marketable securities
 
  
 1,020,243
 
  
 —
 
  
 —
  
   
 
  
 1,020,243

 Accounts receivable, net
 
  
 13,761,917
 
  
 1,848,176
 
  
 —
  
   
 
  
 15,610,093

 Income tax receivable
 
  
 22,756,544
 
  
 —
 
  
 —
  
   
 
  
 22,756,544

 Inventory
 
  
 59,969,928
 
  
 11,428,335
 
  
 —
  
   
 
  
 71,398,263

 Prepayments and other current assets
 
  
 3,896,577
 
  
 2,060,121
 
  
 —
  
   
 
  
 5,956,698

 Warrants held
 
  
 1,684,691
 
  
 —
 
  
 —
  
   
 
  
 1,684,691

 Notes receivable
 
  
 79,226,015
 
  
 —
 
  
 —
  
   
 
  
 79,226,015

 Assets held for sale
 
  
 300,000
 
  
 —
 
  
 —
  
   
 
  
 300,000

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Total current assets
 
  
 305,110,886
 
  
 18,596,348
 
  
 —
  
   
 
  
 323,707,234

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Property and equipment, net
 
  
 217,505,538
 
  
 31,772,999
 
  
 —
  
   
 
  
 249,278,537

 Operating lease right‑of‑use asset
 
  
 53,368,204
 
  
 33,398,798
 
  
 —
  
   
 
  
 86,767,002

 Intangible assets, net
 
  
 117,471,678
 
  
 15,661,186
 
  
 (15,661,186)
  
 B
 
  
 117,471,678

 Goodwill
 
  
 87,534,561
 
  
 —
 
  
 6,460,400
  
 B
 
  
 93,994,961

 Investments
 
  
 6,000,000
 
  
 —
 
  
 —
  
   
 
  
 6,000,000

 Deposits
 
  
 4,390,559
 
  
 —
 
  
 —
  
   
 
  
 4,390,559

 Indemnified tax assets
 
  
 25,772,866
 
  
 —
 
  
 19,531,656
  
 B
 
  
 45,304,522

 Deferred tax asset
 
  
 —
 
  
 1,077,906
 
  
 —
  
   
 
  
 1,077,906

 Other assets
 
  
 —
 
  
 1,337,976
 
  
 —
  
   
 
  
 1,337,976

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Total assets
 
 $
 817,154,292
 
 $
 101,845,213
 
 $
 10,330,870
  
   
 
 $
 929,330,375

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 LIABILITIES
 
  
   
 
  
   
 
  
   
  
   
 
  
   

 Current Liabilities
 
  
   
 
  
   
 
  
   
  
   
 
  
   

 Accounts payable and accrued liabilities
 
 $
 50,254,506
 
 $
 18,205,563
 
 $
 1,309,445
  
 A
 
 $
 69,769,514

 Income taxes payable
 
  
 —
 
  
 7,739,950
 
  
 —
  
   
 
  
 7,739,950

 Convertible debt, current portion
 
  
 1,300,000
 
  
 —
 
  
 —
  
   
 
  
 1,300,000

 Long-term debt, current portion
 
  
 16,290,000
 
  
 5,227,708
 
  
 (5,227,708)
  
 C
 
  
 16,290,000

 Operating right-of-use liability, current
 
  
 3,556,576
 
  
 3,864,415
 
  
 —
  
   
 
  
 7,420,991

 Finance right-of-use liability, current
 
  
 —
 
  
 1,631,126
 
  
 —
  
   
 
  
 1,631,126

 Uncertain tax liability
 
  
 119,954,000
 
  
 11,791,706
 
  
 —
  
   
 
  
 131,745,706

 Derivative liability
 
  
 172,811
 
  
 —
 
  
 —
  
   
 
  
 172,811

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Total current liabilities
 
  
 191,527,893
 
  
 48,460,468
 
  
 (3,918,263)
  
   
 
  
 236,070,098

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Operating right-of-use liability, net of current portion
 
  
 146,308,253
 
  
 33,203,198
 
  
 —
  
   
 
  
 179,511,451

 Finance right-of-use liability, net of current portion
 
  
 —
 
  
 1,395,880
 
  
 —
  
   
 
  
 1,395,880

 Long-term debt, net
 
  
 127,644,855
 
  
 2,230
 
  
 (2,230)
  
 C
 
  
 127,644,855

 Convertible debt, net
 
  
 8,600,000
 
  
 —
 
  
 —
  
   
 
  
 8,600,000

 Contingent consideration
 
  
 24,448,000
 
  
 —
 
  
 —
  
   
 
  
 24,448,000

 Deferred tax liabilities
 
  
 10,217,000
 
  
 —
 
  
 —
  
   
 
  
 10,217,000

 Other long-term liabilities
 
  
 983,299
 
  
 —
 
  
 —
  
   
 
  
 983,299

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Total liabilities
 
  
 509,729,300
 
  
 83,061,776
 
  
 (3,920,493)
  
   
 
  
 588,870,583

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 STOCKHOLDERS’ EQUITY
 
  
   
 
  
   
 
  
   
  
   
 
  
   

 Subordinate Voting shares ($- par value, unlimited shares authorized; 1,057,131,571 shares issued and outstanding at December 31, 2025)
 
  
 —
 
  
 —
 
  
 —
  
 
 
  
 —

 Multiple Voting Shares ($- par value, unlimited shares authorized; 233,192 shares issued and outstanding at December 31, 2025)
 
  
 —
 
  
 —
 
  
 —
  
 
 
  
 —

 Common stock
 
  
 —
 
  
 4
 
  
 (4)
  
 B
 
  
 —

 Preferred stock - Series A and B
 
  
 —
 
  
 64,020,000
 
  
 (64,020,000)
  
 B
 
  
 —

 Additional paid in capital
 
  
 606,974,461
 
  
 85,598
 
  
 (85,598)
  
 B
 
  
 606,974,461

 
 
 
 —
 
 
 —
 
 
 34,344,245
 
 B
 
 
 34,344,245

 Accumulated deficit
 
  
 (299,549,469)
 
  
 (45,322,165)
 
  
 45,322,165
  
 B
 
  
 (299,549,469)

 
 
  
 —
 
  
 —
 
  
 (1,309,445)
  
 A
 
 
 (1,309,445)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Total stockholders’ equity
 
  
 307,424,992
 
  
 18,783,437
 
  
 14,251,363
  
   
 
  
 340,459,792

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Total liabilities and stockholders’ equity
 
 $
 817,154,292
 
 $
 101,845,213
 
 $
 10,330,870
  
   
 
 $
 929,330,375

 
 
 

 UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
 FOR THE YEAR ENDED DECEMBER 31, 2025
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
     
 
     
     
 
     
     
 Transaction
     
     
     
 
     

 
 
 
 
 
 
 
  
 Accounting
 
 
  
 Pro Forma

 
  
 Vireo
  
 Eaze
  
 Adjustments
 
 
  
 Combined

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Revenue
 
 $
 268,769,268
 
 $
 141,140,072
 
 $
 —
  
   
 
 $
 409,909,340

 Cost of sales
 
  
   
 
  
   
 
  
   
  
   
 
  
   

 Product costs
 
  
 122,009,304
 
  
 82,148,802
 
  
 —
  
   
 
  
 204,158,106

 Non-cash product costs
 
  
 17,805,282
 
  
 —
 
  
 —
  
   
 
  
 17,805,282

 Inventory valuation adjustments
 
  
 1,859,305
 
  
 —
 
  
 —
  
   
 
  
 1,859,305

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Gross profit
 
  
 127,095,377
 
  
 58,991,270
 
  
 —
  
   
 
  
 186,086,647

 Operating expenses
 
  
   
 
  
   
 
  
   
  
   
 
  
   

 Selling, general and administrative expenses
 
  
 81,186,632
 
  
 67,272,297
 
  
 —
  
   
 
  
 148,458,929

 Transaction related expenses
 
  
 11,208,273
 
  
 118,000
 
  
 1,309,445
  
 D
 
  
 12,635,718

 Stock-based compensation expenses
 
  
 18,663,707
 
  
 —
 
  
 1,330,000
  
 E
 
  
 19,993,707

 Depreciation
 
  
 11,337,597
 
  
 2,215,278
 
  
 —
  
   
 
  
 13,552,875

 Amortization
 
  
 5,747,651
 
  
 —
 
  
 —
  
   
 
  
 5,747,651

 
 
 
 
 
 
 
 
 
 
 
 
 
  
 

 Total operating expenses
 
  
 128,143,860
 
  
 69,605,575
 
  
 2,639,445
  
   
 
  
 200,388,880

 
 
 
 
 
 
 
 
 
 
 
 
 
  
 

 Loss from operations
 
  
 (1,048,483)
 
  
 (10,614,305)
 
  
 (2,639,445)
  
   
 
  
 (14,302,233)

 
 
 
 
 
 
 
 
 
 
 
 
 
  
 

 Other income (expense)
 
  
   
 
  
   
 
  
   
  
   
 
  
   

 Interest expense, net
 
  
 (15,905,534)
 
  
 (352,949)
 
  
 —
  
   
 
  
 (16,258,483)

 Interest expense on finance lease liabilities - Minnesota & New York
 
  
 (14,348,831)
 
  
 —
 
  
 —
  
   
 
  
 (14,348,831)

 Impairment of long-lived assets
 
  
 (2,600,000)
 
  
 —
 
  
 —
  
   
 
  
 (2,600,000)

 Gain (loss) on disposal of assets and debt
 
  
 (7,866,997)
 
  
 —
 
  
 —
  
   
 
  
 (7,866,997)

 Gain (loss) on change in the fair value of contingent consideration
 
  
 (9,617,000)
 
  
 —
 
  
 —
  
   
 
  
 (9,617,000)

 Derivative gain (loss)
 
  
 (172,811)
 
  
 —
 
  
 —
  
   
 
  
 (172,811)

 Other income (expense)
 
  
 11,648,748
 
  
 (326,631)
 
  
 —
  
   
 
  
 11,322,117

 
 
 
 
 
 
 
 
 
 
 
 
 
  
 

 Other income (expenses), net
 
  
 (38,862,425)
 
  
 (679,580)
 
  
 —
  
   
 
  
 (39,542,005)

 
 
 
 
 
 
 
 
 
 
 
 
 
  
   

 Loss before income taxes
 
  
 (39,910,908)
 
  
 (11,293,885)
 
  
 (2,639,445)
  
   
 
  
 (53,844,238)

 
 
 
 
 
 
 
 
 
 
 
 
 
  
   

 Deferred income taxes recoveries (expenses)
 
  
 13,406,000
 
  
 1,077,906
 
  
 —
  
   
 
  
 14,483,906

 Current income tax expense
 
  
 (41,609,000)
 
  
 (13,907,298)
 
  
 —
  
   
 
  
 (55,516,298)

 
 
 
 
 
 
 
 
 
 
 
 
 
  
   

 Net loss and comprehensive loss
 
  
 (68,113,908)
 
  
 (24,123,277)
 
  
 (2,639,445)
  
   
 
  
 (94,876,630)

 
 
 
 
 
 
 
 
 
 
 
 
 
  
 

 Net loss per share - basic and diluted
 
 $
 (0.09)
 
  
 —
 
  
 —
  
   
 
 $
 (0.11)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 Weighted average shares used in computation of net loss per share - basic and diluted
 
  
 734,738,785
 
  
 —
 
  
 —
  
   
 
  
 825,118,376

 
 
 

 NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
 Note 1. Basis of Presentation
 The unaudited pro forma condensed combined financial information represents the combined companies’ (Vireo and Eaze) unaudited pro forma condensed combined balance sheet as of December 31, 2025 and unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025. The unaudited pro forma condensed combined financial information is based on the historical financial statements of Vireo and Eaze, adjusted to give effect to the Eaze Merger, and should be read in conjunction with the historical financial statements from which they are derived.
 The unaudited pro forma condensed combined financial information is presented in United States dollars.
 The unaudited pro forma condensed combined balance sheet gives effect to the Eaze Merger as if it had occurred on December 31, 2025. The unaudited pro forma condensed combined statement of operations gives effect to the Eaze Merger as if it had occurred on January 1, 2025.
 In preparing the unaudited pro forma condensed combined balance sheet and unaudited pro forma condensed combined statement of operations, the following historical information was used:
 ● Vireo’s audited consolidated financial statements as of and for the year ended December 31, 2025, as filed with the SEC on March 17, 2026; and

 ● Eaze, Inc. and Subsidiaries’ audited consolidated financial statements as of and for the year ended December 31, 2025.

 The unaudited pro forma condensed combined balance sheet and unaudited pro forma condensed combined statement of operations should be read in conjunction with the historical financial statements including the notes thereto, as listed above.
 The unaudited pro forma condensed combined financial information has been prepared for illustrative purposes only and may not be indicative of the operating results or financial condition that would have been achieved if the Eaze Merger had been completed on the dates or for the period presented, nor do they purport to project the results of operations or financial position for any future period or as of any future date. The actual financial position and results of operations may differ materially from the pro forma amounts reflected herein due to a variety of factors.
 The unaudited pro forma condensed combined financial information does not reflect operational and administrative cost savings that may be achieved as a result of the Eaze Merger.
 Note 2. Accounting Policies and Reclassifications
 Subsequent to the consummation of the Eaze Merger, management has commenced a comprehensive review of the entities’ accounting policies. As a result of the review, management may identify differences between the accounting policies of the entities which, when conformed, could have a material impact on the financial statements of the post-combination company. Based on its initial analysis, management did not identify any differences that would have a material impact on the unaudited pro forma condensed combined financial information. As a result, the unaudited pro forma condensed combined financial information does not assume any differences in accounting policies.
 In preparing the unaudited pro forma condensed combined financial information, certain reclassifications were made to Eaze’s historical financial statement presentation to conform to Vireo’s presentation
 

 Note 3. Adjustments to Unaudited Pro Forma Condensed Combined Financial Information
 The unaudited pro forma condensed combined financial information has been prepared to illustrate the effect of the Eaze Merger and related transactions and has been prepared for informational purposes only.
 The following unaudited pro forma condensed combined financial information, has been prepared in accordance with Article 11 of Regulation S-X as amended. Vireo and the Eaze have not had any historical relationship prior to the Eaze Merger. Accordingly, no pro forma adjustments were required to eliminate activities between the companies.
 The pro forma basic and diluted net loss per share amount presented in the unaudited pro forma condensed combined statement of operations is based upon the pro forma number of shares of Vireo stock outstanding, assuming the Eaze Merger and related transactions occurred on January 1, 2025. The basic and diluted earnings per share has been calculated as of December 31, 2025, prior to Vireo’s reverse stock split, which was effective June 5, 2026. If the reverse stock split had occurred as of December 31, 2025, the pro forma weighted average shares used in computation of net loss per share - basic and diluted, would be 27,503,946.
 Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet
 The pro forma adjustments included in the unaudited pro forma condensed combined balance sheet as of December 31, 2025, are as follows:
 A
 Represents Vireo’s total estimated transaction costs not yet recorded in the 2025 historical financial statements, which include advisory, banking, legal and due diligence fees that were incurred in connection with the Eaze Merger.

 B
 Represents the following preliminary adjustments related to applying the acquisition method of accounting given the Eaze Merger is being accounted for as a business combination under Accounting Standards Codification (“ASC”) Topic 805, Business Combinations (“ASC 805”). Vireo has not completed its purchase price allocation and the amounts noted are preliminary.

 ● Issuance of Vireo’s Subordinated Voting Shares to Eaze as consideration transferred

 ● The recognition of acquired goodwill and intangible assets. The expected useful life and amortization period for the intangible and long-lived assets acquired is generally 15 years.

 ● The recognition of indemnified tax assets

 ● Elimination of the Eaze accumulated deficit balance and common and preferred stock balances to additional paid-in- capital. Refer to the table in Note 4 below for additional information related to these adjustments.

 C To remove liabilities not purchased pursuant to the Merger Agreement.
 Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations
 The pro forma adjustments included in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025, are as follows:
 D
 Represents estimated remaining transaction costs not already reflected in the December 31, 2025 historical financial statements of Vireo of $1,309,445 as if incurred on January 1, 2025, the date the Eaze Merger occurred for purposes of the unaudited pro forma condensed combined statement of operations.

 E
 Represents fully vested retention awards, further described below, granted to Eaze employees on the date of closing of the Merger valued at $0.38 for 3,500,000 restricted stock units (the “Closing RSUs”).

 Pursuant to the Merger Agreement, within 30 days following the closing of the transactions under the Merger Agreement, the Company will issue an aggregate of 3,500,000 Closing RSUs to certain employees of Eaze in consideration for such employees’ good faith efforts in connection with the closing of the transactions. Each Closing RSU will be fully vested as of the date of issuance.
 

 Note 4. Estimated Purchase Price Consideration
 The estimated preliminary purchase price allocation for the Eaze Merger and the corresponding aggregate Merger Consideration is presented in the table below as if the Eaze Merger closed on December 31, 2025. Following the close of the Eaze Merger on April 1, 2026, management prepared a preliminary purchase price allocation. The preliminary allocation is subject to revision as additional information becomes available regarding the fair values of the assets acquired and liabilities assumed during the measurement period.
 In general, due to the nature of certain assets acquired and liabilities assumed, the Company has preliminarily determined that the carrying value of those assets and liabilities as of December 31, 2025, approximate their fair value. Management has not finalized the purchase price allocation. Accordingly, the unaudited pro forma condensed combined financial information includes a preliminary allocation of the purchase price based on assumptions and estimates that, while considered reasonable under the circumstances, are subject to changes, and such changes may be material.
 Management will continue to refine its identification and valuation of assets acquired and liabilities assumed as further information becomes available. The final allocation is expected to be completed within twelve months of the Eaze Closing Date and could differ materially from the preliminary allocation used in the transaction accounting adjustments. The final allocation may include (1) changes in fair values of inventory and property and equipment; (2) changes in allocations to intangible assets, such as trade names, licenses, and customer relationships, as well as goodwill; (3) other changes to assets and liabilities; and (4) changes to consideration related to the valuation of contingent consideration.
 The estimated fair values of the components included in the purchase price consideration are preliminary and may materially vary from final results. The Company is still finalizing its conclusions on the accounting treatment associated with the components of the purchase consideration, along with the valuations and necessary calculations related to these components, as described in further detail below.
 Merger Consideration:
 Estimated Merger Consideration of $34,344,245 is based on the Company’s closing share price of $0.38 on April 1, 2026 multiplied by the number of Vireo Subordinate Voting Shares issued of 90,379,591.
 Contingent consideration
 Eaze EBITDA Earn-Out Shares:
 Pursuant to the Merger Agreement, subject to the terms and conditions of the Merger Agreement, former stockholders of Eaze may receive additional Subordinate Voting Shares pursuant to earnout payments following December 31, 2026 based on an EBITDA figure of $76,800,000, less the Base Consideration of $34,344,245, adjusted for certain items as described in the Earn-Out Amount in the Merger Agreement, including certain fees payable in connection with the above purchase price adjustment if not otherwise paid by the Stockholder Representative, certain equipment lease expenses, and tax items, and paid out using a share price for the Subordinate Voting Shares of the higher of $1.05 or the 20-day volume weighted average price of the Subordinate Voting Shares as of the trading day immediately prior to December 31, 2026. In no event shall the number of Subordinate Voting Shares issued in respect of earnout payments under the Merger Agreement exceed the number of shares issued as closing merger consideration under the Merger Agreement.
 The contingent consideration valuation has not been finalized; however, management’s current best estimate is there will be zero value.
 

 Identifiable Net Assets Acquired
 In connection with the Eaze Merger, the Company will recognize intangible assets as reflected in the table below. Goodwill will not be amortized, but instead will be tested for impairment at least annually or more frequently if certain indicators are present. In the event that the value of goodwill or other intangible assets become impaired in the future, an accounting charge for impairment would be recognized during the period in which the determination was made.
 The purchase price has been allocated to the net tangible and identifiable intangible assets and liabilities based on the respective estimated fair values and has not been finalized. The excess of the purchase price over the net tangible and identifiable intangible assets has been recorded as goodwill. Goodwill represents potential operational synergies, various expense synergies, and opportunities to enter new markets, and is assigned to the Company’s cultivation, production, and sale of cannabis business segment.
 

 

 

 

 
     
 Fair Value

 Components of total estimate purchase price consideration
  
 
   

 Merger consideration - Subordinate Voting Shares
 
 $
 34,344,245

 
 
 
 

 Assets acquired
 
  
   

 Cash
 
 $
 3,259,716

 Accounts receivable
 
  
 1,848,176

 Inventory
 
  
 11,428,335

 Prepayments and other current assets
 
  
 2,060,121

 Operating lease, right-of-use asset
 
  
 33,398,798

 Property and equipment
 
  
 31,772,999

 Indemnified tax assets
 
  
 19,531,656

 Deferred tax asset
 
  
 1,077,906

 Other assets
 
  
 1,337,976

 
 
 
 

 Total tangible assets
 
  
 105,715,683

 
 
 
 

 Goodwill
 
  
 6,460,400

 
 
 
 

 Total assets
 
  
 112,176,083

 
 
 
 

 Accounts payable and accrued liabilities
 
  
 (18,205,563)

 Income taxes payable
 
  
 (7,739,950)

 Right-of-use lease liabilities
 
  
 (40,094,619)

 Uncertain tax liability
 
  
 (11,791,706)

 
 
 
 

 Total liabilities assumed
 
  
 (77,831,838)

 
 
 
 

 Net assets acquired
 
 $
 34,344,245

 
 
 Note 5. Net Loss per Share
 Net loss per share was calculated using the historical weighted average shares outstanding and the issuance of additional shares in connection with the Eaze Merger, assuming the shares were outstanding since January 1, 2025. As the Eaze Merger is being reflected as if it had occurred at the beginning of the period presented, the calculation of weighted average shares outstanding for basic and diluted net loss per share assumes that the shares issuable relating to the Eaze Merger have been outstanding for the entirety of the period presented.

 The basic and diluted earnings per share has been calculated as of December 31, 2025, prior to Vireo’s reverse stock split, which was effective June 5, 2026. If the reverse stock split had occurred as of December 31, 2025, the pro forma weighted average shares used in computation of net loss per share - basic and diluted, would be 27,503,946.
 

 

 

 

 
     
 For the Year Ended

 
 
 December 31, 2025 (1)

 Numerator:
  
 
   

 Pro forma net loss
 
 $
 (94,876,630)

 Denominator:
 
  
   

 Weighted average shares outstanding - basic and diluted (2)
 
  
 825,118,376

 Net loss per share:
 
  
   

 Basic and diluted
 
 $
 (0.11)

 Excluded securities (3):
 
  
   

 Stock options
 
  
 34,712,901

 Warrants
 
  
 18,541,586

 Restricted stock units
 
 
 63,065,217

 Shares issuable to convertible debt holders
 
  
 15,920,000

 Eaze contingent consideration (4)
 
  
 —

 
 
 (1) Pro forma net loss per share includes the related pro forma adjustments as referred to within the section “Unaudited Pro Forma Condensed Combined Financial Information.

 (2) The following is the calculation of the weight shares outstanding – basic and diluted.

 

 

 

 Weighted average shares used in computation of net loss per share - basic and diluted
     
 734,738,785

 
 
 

 Shares issued in acquisition (deemed outstanding for full year)
  
 90,379,591

 
 
 

 Weighted average shares outstanding
  
 825,118,376

 
 (3) The potentially dilutive outstanding securities were excluded from the computation of pro forma net loss per share, because their effect would have been anti-dilutive.

 (4) Represents shares that may potentially be issued to the former stockholders of Eaze under Item 2.01 of the Eaze Merger Agreement.

EX-23.1 · vreof-20260331xex23d1.htm

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EX-23.1

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vreof-20260331xex23d1.htm

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EX-23.1 · vreof-20260331xex23d1.htm EX-23.1 2 vreof-20260331xex23d1.htm EX-23.1 Exhibit 23.1 Consent of Independent Auditor We consent to the incorporation by reference in the registration statements on Form S-3 (Nos. 333-282311, 333-288686 and 333-292025) and on Form S-8 (Nos. 333-252690, 333-278478, 333-278479 and 333-289692) of Vireo Growth Inc. and the inclusion in this Amendment No. 1 to Current Report on Form 8-K of Vireo Growth Inc. of our report dated June 2, 2026, relating to the consolidated financial statements of Eaze, Inc. and Subsidiaries as of December 31, 2025 and for the year then ended. Boca Raton, Florida June 11, 2026

Document text

EX-23.1 · vreof-20260331xex23d1.htm

EX-23.1
 2
 vreof-20260331xex23d1.htm
 EX-23.1

 Exhibit 23.1
 Consent of Independent Auditor
 We consent to the incorporation by reference in the registration statements on Form S-3 (Nos. 333-282311, 333-288686 and 333-292025) and on Form S-8 (Nos. 333-252690, 333-278478, 333-278479 and 333-289692) of Vireo Growth Inc. and the inclusion in this Amendment No. 1 to Current Report on Form 8-K of Vireo Growth Inc. of our report dated June 2, 2026, relating to the consolidated financial statements of Eaze, Inc. and Subsidiaries as of December 31, 2025 and for the year then ended.

 Boca Raton, Florida
 June 11, 2026

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