Company: VREOF
Filing Date: 2025-03-21
Form Type: DEFM14C
Source: 0001140361-25-009815
Chunk: 378

Company: Vireo Growth Inc.
Filing Date: 2025-03-21
Form: DEFM14C
Chunk 378
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 payments over the lease term at the commencement date of the lease. The ROU assets also include any initial direct costs incurred and lease payments made at or before the commencement date and are reduced by any lease incentives.

The Company accounts for lease and non-lease components in its contracts as a single lease component for its real estate and vehicle asset classes. The non-lease components typically represent additional services transferred to the Organization, such as common area maintenance for real estate or maintenance packages for vehicles, which are variable in nature and are recorded in lease expense in the period incurred.

#### Marketing and Advertising Costs
Sales and marketing costs are charged to operations in the year incurred. Advertising costs for the years ended December 31, 2024 and 2023 was $1,606,721 and $983,154, respectively.

#### Subsequent Events
The Company has evaluated subsequent events through February 28, 2025, the date on which the consolidated financial statements were issued.

#### New Accounting Pronouncements - CECL
The Company adopted ASU No. 2016-13, “Measurement of Credit Losses (Topic 326) on Financial Instruments,” which introduces the current expected credit losses methodology (CECL) for estimating allowances for credit losses, which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected loss (CECL) methodology. The measurement of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost, including loan receivables and held-to-maturity debt securities. It also applies to off-balance sheet credit exposures not accounted for as insurance. In addition, ASC 326 made changes to the accounting for available-for-sale securities.

The Company adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized costs and off balance sheet credit exposures. Results for reporting periods after January 1, 2023 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable U.S. GAAP. There are no transition adjustments as of January 1, 2023.

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TABLE OF CONTENTS

| NOTE 2: | INVENTORY |

Detail of inventories are as follows for December 31:

|                                |     |       2024 |     |       2023 |
| Packaging and Label Materials  |     | $3,200,555 |     | $3,088,769 |
| Plants                         |     |    623