Company: VREOF
Filing Date: 2025-06-06
Form Type: 8-K
Source: 0001104659-25-057335
Chunk: 3

Company: Vireo Growth Inc.
Filing Date: 2025-06-06
Form: 8-K
Item: Item 2.01
Chunk 3
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 the Total Merger Consideration,
please see the disclosures regarding the Mergers in the Information Statement. The Company included in the Closing Merger Consideration
calculation an amount equal to $2,139,200 (the “ Arches Value Amount”), which Arches Value Amount is intended to represent
the value of the issued and outstanding equity interests in Arches IP, Inc. (“ Arches”) owned by MSA Newco, which as of the
Closing Date represent approximately 15.28% of the issued and outstanding equity securities of Arches.

Subject to the terms and conditions of the Merger Agreement, Holdings
is entitled to earn-out payments based on the performance of Arches, based on the greater of $37.5 million or 5x certain revenue percentages
of Arches minus $4,000,000, with such revenue percentage amounts measured at the higher of trailing-twelve-month or nine-month annualized
amounts as of December 31, 2026, paid out using a share price for the Parent Shares at the higher of $1.05 or 20-day volume weighted average
price (“ VWAP”) ending immediately prior to December 31, 2026.

Pursuant to the Merger Agreement, Holdings may also receive additional
Parent Shares pursuant to earn-out payments based on the Acquired Companies’ Adjusted EBITDA growth compared to the Acquired Companies’
Closing EBITDA (at a 4x multiple), adjusted for incremental debt and certain other matters, and paid out using a share price for the Parent
Shares of the higher of $1.05 or the 20-day VWAP as of immediately prior to December 31, 2026. EBITDA growth is defined as the increase
between Closing EBITDA and the higher of 2026 Adjusted EBITDA or trailing nine-month annualized Adjusted EBITDA as of December 31, 2026.

In no event shall the number of earn-out shares issued under the Merger
Agreement, in the aggregate, exceed the Closing Share Payment.

The Merger Agreement provides for the clawback of up to 50% of the
Parent Shares issued as Actual Closing Merger Consideration (excluding the Parent Shares issued as consideration for the Arches Value
Amount), if 2026 Adjusted EBITDA is less than 96.5% of the Closing EBITDA (the amount of such shortfall, the “ EBITDA Deficiency”).
The amount