Company: VREOF
Filing Date: 2025-03-21
Form Type: DEFM14C
Source: 0001140361-25-009815
Chunk: 222

Company: Vireo Growth Inc.
Filing Date: 2025-03-21
Form: DEFM14C
Chunk 222
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 Shares to be issued at the closing date of the Deep Roots Merger (the “Deep Roots Closing Date”) was calculated by dividing the value of the merger consideration as of December 18, 2024 by a share price reference of $0.52 for Vireo’s Subordinate Voting Shares. In general, the Merger Consideration is based upon a multiple of a $31,000,000 earnings before interest, taxes, depreciation, and amortization (“EBITDA”), adjusted for certain items as described in the definition of Merger Consideration in the Deep Roots Merger Agreement, including cash, indebtedness, transaction expenses, working capital, and tax items.

At the Deep Roots Closing Date, each share of the common stock, par value $0.001 per share, of Deep Roots (the “Deep Roots Common Stock”) will be converted into the right to receive, in accordance with the terms of the Deep Roots Merger Agreement, the applicable portion of the Merger Consideration, subject to a post-closing purchase price adjustment mechanism, which Merger Consideration will be paid via newly issued shares of the Company’s Subordinate Voting Shares at a share price of $0.52 per share. The holders of Deep Roots Common Stock will also be eligible to receive additional Subordinate Voting Shares through an earn-out mechanism based upon the EBITDA performance of Deep Roots and its subsidiaries during 2026 (the “Deep Roots Earn-Out Shares”).

The Deep Roots Merger will be 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 presents the combination of the financial information of Vireo and Deep Roots adjusted to give effect to the Deep Roots Merger and related transactions. 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 Deep Roots, both of which have December 31 fiscal year ends, as adjusted to give effect to the Deep Roots Merger. The unaudited pro forma condensed combined balance sheet as of December 31, 2024 gives effect to the Deep Roots Merger as if it had occurred on December 31, 2024