Company: VREOF
Filing Date: 2025-03-21
Form Type: DEFM14C
Source: 0001140361-25-009815
Chunk: 346

Company: Vireo Growth Inc.
Filing Date: 2025-03-21
Form: DEFM14C
Chunk 346
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 the year ended December 31, 2024, shares totaling 3,778,708 vested. As of December 31, 2024, 4,921,292 shares were unvested. There were no forfeitures during the year ended December 31, 2024. The grant date fair value was $1.30 and share-based compensation recognized was $4,912,321. The shares were valued based on the estimated fair market value of the Company.

| 11. | INCOME TAXES |

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 has taken a position that it does not owe taxes attributable to the application of Section 280E of the Internal Revenue Code. The Company is subject to examination of its income tax returns by tax authorities. Because tax matters that may be challenged by tax authorities are typically complex, the ultimate outcome of these challenges is uncertain. The Company does not anticipate unrecognized tax benefits to be resolved in the next twelve months and anticipates that the total amount of unrecognized tax benefits may change within the next twelve months for additional uncertain tax position taken on a go-forward basis. The Company is no longer subject to income tax examination by tax authorities for years before 2020. The Company has an income tax receivable of $8,295,721 with uncertain tax position liabilities of $12,282,308 as of December 31, 2024. In 2023, the Company owed taxes in the amount of $7,672,022, which includes $3,880,789 related to the uncertain tax position. The deferred tax asset and related benefit and expense relates to depreciation for the years ended December 31, 2024 and 2023 . There is no state income tax for the state of Nevada.

| 12. | LEASE OBLIGATIONS |

The Company has operating leases for its retail dispensaries and cultivation and processing facility located throughout the state of Nevada. Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of future minimum lease payments over the lease term and commencement date.

B-18

TABLE OF CONTENTS

12. LEASE O