UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________________

FORM 10-K

________________________________________

(Mark One)


x			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, ~~2024~~2025


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 000-56342

________________________________________

VERANO HOLDINGS CORP.

________________________________________

(Exact name of registrant as specified in its charter)

British Columbia, Canada			98-1583243
Nevada			98-1583243
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
224 W Hill Street, Suite 400, Chicago, Illinois			60610
224 W. Hill Street, Suite 400, Chicago, Illinois			60610
(Address of Principal Executive Offices)			(Zip Code)


(312) 265-0730
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

N/A

Securities registered pursuant to section 12(g) of the Act:

~~Class~~Common AStock, ~~subordinate~~$0.001 ~~voting~~par ~~shares~~value per share (Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes xo No ox

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer xo Accelerated filer ox Non-accelerated filer o Smaller reporting company o Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. x

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. o

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x

The aggregate market value of the registrant’s previously authorized Class A subordinate voting shares, and Class B proportionate voting shares (on an as converted to Class A subordinate voting shares basis), based on the closing price of the Class A subordinate voting shares listed on Cboe Canada as of June 2830, ~~2024~~2025, the last business day of the registrant’s most recently completed second fiscal quarter, held by non-affiliates was $~~901~~164,~~354~~049,~~299~~793. For this purpose, directors, executive officers and greater than 10% record ~~shareholders~~stockholders are considered affiliates of the registrant. On November 3, 2025, all Class A subordinate voting shares were deemed to be exchanged for authorized, issued and outstanding shares of common stock, par value $0.001 per share, of the registrant on a one-for-one basis, and the Class B proportionate voting shares, of which there were none outstanding as of such time or as of June 30, 2025, were no longer authorized shares of the registrant.

The registrant had outstanding ~~358~~363,~~950~~245,~~322~~512 ~~Class A subordinate voting~~ shares ~~and~~of nocommon ~~Class~~stock ~~B proportionate voting shares~~ as of ~~February~~March 2510, ~~2025~~2026.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the definitive Proxy Statement to be delivered to ~~shareholders~~stockholders in connection with the Annual Meeting of ~~Shareholders~~Stockholders to be held during ~~2025~~2026 are incorporated by reference into Part III of this Annual Report on Form 10-K.

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TABLE OF CONTENTS

			Page
PART I
Item 1. Business			4
Item 1A. Risk Factors			2930
Item 1B. Unresolved Staff Comments			6667
Item 1C. Cybersecurity			6668
Item 2. Properties			6870
Item 3. Legal Proceedings			7476
Item 4. Mine Safety Disclosures			7476
PART II
Item 5. Market for Registrant's Common Equity, Related Stockholder Mattersand Issuer Purchases of Equity Securities			7577
Item 6. [Reserved]			8779
Item 7. Management Discussion and Analysis of Financial Condition and Results of Operation			88
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation			80
Item 7A. Quantitative and Qualitative Disclosures About Market Risk			~~101~~94
Item 8. Financial Statements and Supplementary Data			~~103~~96
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure			~~103~~96
Item 9A. Controls and Procedures			~~103~~96
Item 9B. Other Information			~~105~~97
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspection			~~105~~98
PART III
Item 10. Directors, Executive Officers and Corporate Governance			~~106~~99
Item 11. Executive Compensation			~~106~~99
Item 12. Security Ownership of Certain Beneficial Owners and Managementand Related Stockholder Matters			~~106~~99
Item 13. Certain Relationships and Related Transactions, and Director Independence			~~106~~99
Item 14. Principal Accounting Fees and Services			106
Item 14. Principal Accountant Fees and Services			99
PART IV
Item 15. Exhibits and Financial Statement Schedules			~~106~~100
Item 16. Form 10-K Summary			~~114~~108
SIGNATURES			~~115~~109

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Cautionary Note onRegarding Forward-Looking Statements

This Annual Report on Form 10-K (this “Form 10-K”) contains “forward-looking information” and “forward-looking statements” within the meaning of United States and Canadian securities laws (together, “forward-looking statements”). All statements, other than statements of historical fact, made by the Company or its affiliates that address activities, events or developments that the Company or its affiliates expect or anticipate will or may occur in the future are forward-looking statements, including, but not limited to, statements preceded by, followed by or that include words such as “may,” “will,” “would,” “could,” “should,” “believes,” “assumes,” “estimates,” “projects,” “potential,” “expects,” “plans,” “intends,” “anticipates,” “targeted,” “continues,” “forecasts,” “designed,” “goal,” “progress,” or the negative of those words or other similar or comparable words.

The forward-looking statements contained herein are based on certain key expectations and assumptions, including, but not limited to, expectations and assumptions concerning:

•our ability to obtain, maintain and renew licenses and other regulatory approvals in all states and localities of our operations and planned operations on a timely basis;

•government regulations, including future U.S. state and federal legislative and regulatory developments involving medical and adult use cannabis and the timing thereof;

•our outlook on our expansion and growth of business and operations;

•our ability to achieve our goals, business plans and strategy;

•our ability to access capital and obtain necessary financing to pursue our growth and business plans;

•our operational results and other financial and business conditions and prospects;

•the timing and completion of acquisitions and other commercial transactions;

•the integration and operation of acquired businesses;

•the timing and amount of capital expenditures;

•the availability of facilities, equipment, skilled labor and services needed for cannabis operations;

•demand, developments and trends in the medical and adult use cannabis industry;

•competition in the cannabis industry in the markets in which we operate or plan to operate;

•the medical benefits, viability, safety, efficacy, and dosing of cannabis;

•the size of the medical cannabis market and the adult use cannabis market in each state; and

•conditions in general economic and financial markets.

Forward-looking statements may relate to future financial conditions, results of operations, plans, strategies, objectives, performance or business developments. These statements speak only as at the date they are made and are based on information currently available and on the then-current expectations of the party making the statement and assumptions concerning future events, which are subject to a number of known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from that which was expressed or implied by such forward-looking statements, including, but not limited to, risks and uncertainties related to:

•the current illegality of cannabis under federal law, the U.S. federal regulatory landscape and enforcement related to medical or adult use cannabis, including political risks, civil asset forfeiture and regulation by additional regulatory authorities;

•regulatory and political changes to U.S. federal, state and local laws related to medical or adult use cannabis, including political risks and regulation by additional regulatory authorities;

•rescheduling may lower the barriers to entry for well-capitalized institutional competitors;

•the federal rescheduling process is subject to significant procedural delays and legal challenges;

•the impacts of economic uncertainty stemming from disruptions in U.S. and global markets, inflation, rising interest rates, and changes in consumer and business confidence;

•our outstanding indebtedness and potential future indebtedness, including our ability to repay such indebtedness;

•reliance on key management;

•market acceptance of existing and new products and potential returns or recalls of our products;

•potential cultivation biosecurity failures;

•consumer acceptance of our brand portfolio;

•the accuracy of our forecasted demand for our products;

•our ability to accurately forecast, manage, and monetize inventory;

•the potential for fraudulent activity by employees, contractors and consultants;

•our exposure to growth-related operational and execution risks;

•potential negative findings in our clinical research with respect to our products;

•our ongoing litigation matter with Vireo Growth Inc., formerly known as Goodness Growth Holdings, Inc;

•potential product liability claims;

•our exposure to natural phenomena and resulting potential uninsured or under insured losses;

•the risk that our property will be subject to civil asset forfeiture;

•our structure and our resulting reliance on the performance of our subsidiaries and affiliates;

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•our exposure to natural phenomena and resulting potential uninsured or under insured losses;

•the risk that our property will be subject to civil asset forfeiture;

•our corporate structure and our resulting reliance on the performance of our subsidiaries and affiliates;

•our expansion-by-acquisition strategy;

•our ability to acquire businesses and cannabis licenses in desired markets and the integration and operation of acquired businesses;

•the typically limited operations of businesses we acquire;

•the unconventional due diligence process in the cannabis industry;

•our ability to acquire and lease properties suitable for the cultivation, production and sale of cannabis;

•potential limited representations and warranties of businesses we may acquire;

•our acquisition of businesses in developing cannabis markets;

•our lack of portfolio diversification by industry orand ~~geography~~geographic concentration;

•our use of joint ventures, strategic partnerships and alliances;

•our contractual relationships with our consolidated variable interest entities;

•existing competition and new market entrants;

•the introduction of synthetic alternatives to cannabis products by pharmaceutical and other companies;

•the immaturity of the cannabis industry and limited comparable, competitive and established industry best practices;

•the availability of and our reliance on third-party suppliers, service providers, contractors and manufacturers, and any significant interruption of these relationships, including negative changes to quality, availability, pricing, trade policy and other economics;

•changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences;

•wholesale and retail price fluctuations;

•public opinion and perception of the cannabis industry;

•the availability of raw or other materials;

•rising or volatile energy costs;

•agricultural and environmental risks and the impacts of environmental regulations on the cannabis industry and environmental protections;

•physical security risks, such as theft;

•potential scrutiny from Canadian authorities;

•disparate state-by-state regulatory landscapes and licensing regimes for medical and adult use cannabis;

•the difficulties cannabis businesses face accessing and maintaining banking or financial services due to federal regulations;

•the cost and difficulty of complying with various regulatory schemes;

•the impact of state social equity legislation as it relates to the cannabis industry;

•the risk of high bonding and insurance costs;

•environmental regulations;

•effects of changes in laws and policies governing employees and by union organizing activity;

•increased unionization efforts and labor shortages;

•potential scrutiny from Canadian authorities due to our status as an SEC Foreign Issuer (defined below);

•potential divestment of licenses if required by regulatory authorities;

•our dependency on the banking industry;

•required public disclosure and governmental filings containing personal information of our officers, investors and other stakeholders;

•potential findings by regulatory authorities that one of ~~shareholders~~our stockholders is unsuitable;

•the risk that our directors, officers, employees or investors are barred from entering the U.S.;

•the ability to, and constraints on, promoting and marketing cannabis products;

•potential U.S. Food and Drug Administration governance of the cannabis industry;

•the potential limitations on our ability to enforce our contracts or any liens granted to us;

•the potential lack of access to federal bankruptcy protections in the U.S.;

•reliance on information technology systems, the potential disclosure of personal information of patients and customers and cybersecurity risks;

•our increasing use of, or failure to effectively implement, artificial intelligence (AI) and automated systems;

•our reliance on third-party software providers;

•~~cost~~costs related to preserving our brand identity;

•our ability to protect our intellectual property due to limited intellectual property protection available for cannabis products and the potential infringement by third parties;

•potential infringement or misappropriation claims;

•the risk of financial crimes;

•the risk of receiving no return on our securities;

•our elimination of monetary liability and indemnification rights against our directors, officers and employees under British Columbia law;

•our dual class capital structure with Class A subordinate voting shares and Class B proportionate voting shares;

•the time and resources necessary to comply with corporate governance practices and securities rules and regulations in the U.S. and Canada;

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•the inability to realize the anticipated benefits of the Continuance (as defined below), or to do so within the anticipated timeframe;

•the risk of receiving no return on our securities;

•our elimination of individual liability and indemnification rights against our directors, officers and employees under Nevada law;

•our organizational documents contain provisions that may prevent transactions that could be beneficial to our stockholders and may insulate our management from removal;

•the time and resources necessary to comply with corporate governance practices and securities rules and regulations;

•our management’s ability to maintain effective internal controls;

•potential dilution if we issue additional ~~Subordinate~~shares ~~Voting~~of ~~Shares~~Common orStock ~~Proportionate~~(as ~~Voting~~defined ~~Shares~~below);

•market perception of sales of a substantial amount of ~~Subordinate~~Common ~~Voting Shares~~Stock;

•transfer restrictions on our ~~Subordinate~~Common ~~Voting Shares~~Stock;

•price volatility of our ~~Subordinate~~Common ~~Voting Shares~~Stock;

•our ~~shareholders~~stockholders’ limited participation in our affairs;

•our expectation to not declare or pay out dividends;

•~~the~~certain ~~concentration~~of our stockholders holding Common Stock representing greater than 5% of our voting ~~control~~power;

•the taxation of cannabis companies in the U.S., including the impact of Section 280E of the Internal Revenue Code of 1986, as amended (“Section 280E”); and

•other risks described in this Form 10-K, as more particularly described under the heading “Item 1A. Risk Factors” therein.

Although we believe that the expectations and assumptions on which forward-looking statements are based are reasonable at the time made, undue reliance should not be placed on the forward-looking statements, because no assurance can be given that they will prove to be correct. Forward-looking statements address future events and conditions, and thus involve inherent risks and uncertainties. Readers are cautioned that the above list of cautionary statements is not exhaustive.

The cannabis industry involves risks and uncertainties that are subject to change based on various factors. Certain forward-looking statements contained herein concerning the cannabis industry and our general expectations concerning the cannabis industry are based on estimates prepared by us using data from publicly available governmental sources as well as from market research and industry analysis and on assumptions based on data and knowledge of the cannabis industry. Such data is inherently imprecise.

Consequently, all forward-looking statements made in this Form 10-K and our other documents are qualified by such cautionary statements and there can be no assurance that the anticipated results or developments will actually be realized or, even if realized, that they will have the expected consequences to or effects on us. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required under applicable securities legislation.

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PART I

ITEM 1. BUSINESS

Overview

Verano Holdings Corp., a ~~British~~Nevada ~~Columbia~~ corporation (“Verano,” the “Company,” “we,” “us,” or “our”), one of the U.S. cannabis industry’s leading companies based on historical revenue, geographical scope and brand performance, is a vertically integrated, multi-state operator embracing a mission of saying Yes to plant progress and the bold exploration of cannabis. AnAs an operator of licensed cannabis cultivation, processing, wholesale distribution and retail facilities, our goal is ~~the~~to ~~ongoing~~support ~~development of~~ communal wellness by providing responsible access to regulated medical and adult use cannabis products. As of ~~February~~March 2510, ~~2025~~2026, through our subsidiaries and affiliates we operate businesses in 13 states, including ~~153~~160 retail dispensaries and 1514 cultivation and processing facilities with over 1.1 million square feet of cultivation capacity. We produce a wide variety of ~~high quality~~ cannabis products sold under our portfolio of consumer brands, including Encore™, Avexia™, MÜV™, Savvy™, (the) Essence™, BITS™, HYPHEN™, Swift Lifts™ and Verano™. We also design, build and operate branded ~~retail~~dispensaries ~~environments~~operating ~~including~~under the Zen Leaf™ and MÜV™ ~~dispensaries~~retail banners, among others, that deliver a cannabis shopping experience in both medical and adult use markets.

Notwithstanding the permissive regulatory environment of medical, and in some cases, also adult use (i.e., recreational) cannabis, at the state level, it remains illegal under U.S. federal law to cultivate, manufacture, distribute, sell or possess cannabis in the U.S. Because federal law prohibits transporting any federally restricted substance across state lines, cannabis cannot be transported across state lines. As a result of current federal law prohibitions, the U.S. cannabis industry is conducted on a state-by-state basis. To date, in the U.S. 3840 states plus the District of Columbia and the U.S. territories of Puerto Rico, Guam, the Commonwealth of Northern Marina Islands, and the U.S. Virgin Islands have authorized comprehensive medical cannabis programs, 24 states plus the District of Columbia and the U.S. territories of Guam, the Commonwealth of Northern Mariana Islands, and the U.S. Virgin Islands have authorized comprehensive programs for medical and adult use (i.e. recreational) cannabis, and 7eight states allow the use of low tetrahydrocannabinol (“THC”) and high cannabidiol (“CBD”) products for specified medical uses. Verano operates within states where cannabis use, medical or both medical and adult use, has been approved by state and local regulatory bodies. 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 or any of its subsidiaries. On December 18, 2025, President Trump issued an executive order titled “Increasing Medical Marijuana and Cannabidiol Research,” (the “Executive Order”) which directs federal agencies to expedite the process of rescheduling cannabis from a Schedule I to a Schedule III controlled substance under the Controlled Substances Act (21 U.S.C. § 811) (the “Controlled Substances Act” or the “CSA”). The effect of the Executive Order may be that the cultivation, manufacturing, distribution, sale or possession of cannabis in the U.S. is no longer federally illegal and would lessen criminal penalties at the federal level and remove Section 280E tax considerations, however, the final effects of the Executive Order are dependent on other government actions. Despite such actions and the ongoing rule making process, there can be no guarantees that the rescheduling rule making process will continue on a certain timeline or at all under this administration or that any rules will come out of the rule making process that will benefit the Company. The Executive Order, and agency implementation of the Executive Order does not federally legalize adult use and would not federally authorize or approve state sanctioned medical programs. Cannabis would still be subject to the same FDA drug approval process as all other substances, and sales outside of FDA approval, would still be criminal at the federal level.

For the fiscal year ended December 31, ~~2024~~2025, medical-use sales and adult use sales comprised approximately 5153% and 4947% of our consolidated revenues, respectively. For each of the fiscal years ended December 31, ~~2023~~2024 and ~~2022~~2023, medical-use sales and adult use sales comprised approximately 5551% and 4549% of our consolidated revenues and approximately 6055% and 4045% of our consolidated revenues, respectively.

Substantially all of the Company’s business, operating results and financial condition relate to U.S. cannabis-related activities. Our strategy is to vertically integrate as a single cohesive company in multiple states through the consolidation of seed-to-sale cultivating, manufacturing, distributing, and dispensing cannabis brands and products at scale. Our cultivation, processing and distribution of cannabis consumer packaged goods are designed to ~~leverage~~support ~~shelf-space in~~ our ~~national~~ retail ~~dispensary chains~~dispensaries, as well as to develop and foster long term wholesale supply relationships with third-party retail operators. Our model includes ~~geographic diversity by~~ establishing a diverse geographic footprint tothat ~~allow~~allows us to adapt to changes in both industry and market conditions.

Verano is a reporting issuer under both applicable securities legislation in all of the provinces and territories of Canada and applicable federal securities legislation in the U.S. The Company’s Class A subordinate voting shares (the “Subordinate Voting Shares”) are listed on Cboe Canada (“Cboe”) under the stock symbol, “VRNO,” and are also quoted for trading in the U.S. on the OTCQX under the stock symbol “VRNOF”.

The corporate headquarters of Verano is located at 224 W Hill Street, Suite 400, Chicago, Illinois 60610. Verano’s Canadian registered office is located at 20th Floor, 250 Howe Street, Vancouver, British Columbia V6C 3R8. Verano’s telephone number is (312) 265-0730. Verano’s internet address is www.verano.com. The information provided on the Company’s website is not part of this Form 10-K, unless otherwise noted.

The U.S. Securities and Exchange Commission (the “SEC”) maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. The Company also files reports, circulars, annual information statements, and other information regarding the Company with the securities regulatory authorities of Canada via the System for Electronic Document Analysis and Retrieval at www.sedarplus.ca.

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Verano is a reporting issuer under both federal securities legislation in the U.S. and applicable securities legislation in all of the provinces and territories of Canada, being classified thereunder as an “SEC Foreign Issuer” for purposes of Canadian securities laws. The Company’s common stock, par value $0.001 per share (“Common Stock”) is listed on Cboe Canada (“Cboe”) under the stock symbol, “VRNO,” and is also quoted for trading in the U.S. on the OTCQX under the stock symbol “VRNO”.

The corporate headquarters of Verano is located at 224 W. Hill Street, Suite 400, Chicago, Illinois 60610. Verano’s telephone number is (312) 265-0730. Verano’s internet address is www.verano.com. The information provided on the Company’s website is not part of this Form 10-K, unless otherwise noted.

The U.S. Securities and Exchange Commission (the “SEC”) maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. As an SEC Foreign Issuer in Canada, currently the Company also files reports, and other information regarding the Company with the securities regulatory authorities of Canada via the System for Electronic Document Analysis and Retrieval at www.sedarplus.ca.

History of the Company

Verano Holdings, LLC, a subsidiary of the Company (“Verano LLC”), was the start of Verano’s business operations. Verano LLC is a Delaware limited liability company that was co-founded by George Archos, our current Chairman, Chief Executive Officer and President, in September 2017. Verano LLC was formed as a Chicago, Illinois based holding company to consolidate cannabis operations initially in Illinois, including cultivation and production facilities and retail dispensaries. Verano LLC, either directly or through subsidiaries or affiliates, acquired control, management, ownership, and other rights to medical and adult use cannabis businesses across multiple U.S. states, including cultivation, production, wholesale distribution and retail dispensaries.

~~Verano~~On ~~Holdings~~December 14, 2020, Verano LLC, aMajesta ~~subsidiary~~Minerals, ofInc., ~~the~~an ~~Company~~Alberta ~~(“Verano~~corporation, ~~LLC”)~~and certain British Columbia corporations named therein, ~~was~~entered into an arrangement agreement, pursuant to which the ~~start~~Company ofwould ~~Verano’s~~result ~~business~~from ~~operations.~~a ~~Verano~~reverse ~~LLC~~takeover istransaction as a ~~Delaware~~British ~~limited~~Columbia ~~liability~~public reporting company ~~that~~(the ~~was~~“RTO”). ~~co-founded~~The byRTO ~~George~~and ~~Archos,~~related ~~our~~transactions ~~current~~(the ~~Chairman~~“Go ~~and~~Public ~~Chief~~Transactions”), ~~Executive~~closed ~~Officer~~on February 11, in2021, ~~September~~resulting ~~2017.~~in ~~Verano~~the ~~LLC~~creation ~~was~~of ~~formed~~the Company as a ~~Chicago,~~Canadian ~~Illinois~~publicly-traded ~~based~~company ~~holding~~and ~~company~~the toparent ~~consolidate~~holding ~~cannabis~~company ~~operations~~of ~~initially~~Verano inLLC ~~Illinois,~~and ~~including~~its ~~cultivation~~subsidiaries and ~~production~~ownership ~~facilities~~ and ~~retail~~control ~~dispensaries~~interests.

~~Beginning~~The inRTO ~~August~~authorized ~~2018,~~the ~~Verano~~Company’s ~~LLC~~former ~~began~~dual toclass ~~acquire~~structure ~~control,~~of ~~management,~~an ~~ownership~~unlimited number of Class A subordinate voting shares (the “Subordinate Voting Shares”) and an unlimited number of Class B proportionate voting shares (the “Proportionate Voting Shares”). Each Proportionate Voting Share was convertible into 100 Subordinate Voting Shares, and each ~~other~~Subordinate Voting Shares was convertible into 1/100 of a Proportionate Voting Share. The rights, topreferences ~~medical~~and protections of the Subordinate Voting Shares and ~~adult~~the ~~use~~Proportionate ~~cannabis~~Voting ~~licenses~~Shares inwere ~~U.S.~~the ~~states~~same ~~where~~based ~~Verano~~upon ~~LLC~~the ordeemed ~~Verano~~conversion ~~LLC’s~~ratio ~~co-founders~~of ~~held~~100 anSubordinate ~~existing~~Voting ~~ownership~~Shares orfor ~~management~~one ~~stake~~Proportionate Voting Share.

~~Starting~~On inNovember ~~January~~3, ~~2019~~2025 (the “Continuance Effective Date”), ~~Verano~~the ~~LLC~~Company ~~implemented~~filed anarticles ~~expansion~~of ~~strategy~~domestication ~~whereby~~and ~~Verano~~articles ~~LLC~~of incorporation with the Secretary of State of the State of Nevada to continue out from the jurisdiction of the Province of British Columbia, ~~either~~Canada, ~~directly~~to orthe ~~through~~jurisdiction ~~subsidiaries~~of orthe ~~affiliates~~U.S. State of Nevada (the “Continuance”). The Continuance was consummated pursuant to a Plan of Arrangement, ~~began~~which ~~acquiring~~was ~~control~~approved by the Company’s stockholders at a special meeting of the stockholders held on October 27, ~~management~~2025, ~~ownership~~and a Final Order issued by the Supreme Court of British Columbia, Canada on October 30, 2025. As part of the Continuance, the previously authorized, issued and ~~other~~outstanding ~~rights~~Subordinate Voting Shares of the Company were deemed to ~~medical~~be exchanged on the Continuance Effective Date for authorized, issued and ~~adult~~outstanding ~~use~~shares ~~cannabis~~of ~~businesses~~Common ~~across~~Stock ~~multiple~~of the Company on a one-for-one basis (the “Share Exchange”). The Proportionate Voting Shares were no longer authorized, and all special rights and restrictions of the Proportionate Voting Shares were removed from the Company’s governing documents. The issuance of the shares of Common Stock in connection with the Share Exchange was made in reliance upon the exemption from registration provided by Section 3(a)(10) of the U.S. ~~states,~~Securities ~~including~~Act ~~cultivation,~~of ~~production~~1933, ~~wholesale~~as ~~distribution~~amended. The Subordinate Voting Shares and ~~retail~~Proportionate ~~dispensaries~~Voting Shares are no longer part of the authorized capital structure of the Company.

Go Public Transactions

On December 14, 2020, Verano LLC, Majesta Minerals, Inc., an Alberta corporation, 1276268 B.C. Ltd., a British Columbia corporation, 1277233 B.C. Ltd, a British Columbia corporation, and 1278655 B.C. Ltd., a British Columbia corporation, entered into an arrangement agreement, pursuant to which the Company would result from a reverse takeover transaction as a British Columbia public reporting company (the “RTO”).

On November 6, 2020, Verano LLC entered into an agreement and plan of merger with Alternative Medical Enterprises LLC (“AltMed”), Plants of Ruskin GPS, LLC and RVC 360, LLC (together, with Plants of Ruskin GPS, LLC, “Plants of Ruskin” and, collectively with AltMed, the “AME Parties”), pursuant to which the Company, as the assignee of all of Verano LLC’s rights and obligations thereunder, acquired the AME Parties and their subsidiaries and ownership and control interests (collectively with the AME Parties, the “AME Group”) via a series of merger transactions. The merger transactions were contingent upon, and were to be consummated contemporaneously with, the RTO. The RTO and the merger transactions with the AME Parties (collectively, the “Go Public Transactions”), each closed on February 11, 2021, resulting in the creation of the Company as a Canadian publicly-traded company and the parent holding company of Verano LLC, the AME Parties and their respective subsidiaries and ownership and control interests.

The RTO authorized the Company’s dual class structure of an unlimited number of Class B proportionate voting shares (the “Proportionate Voting Shares”), each of which is convertible into 100 Subordinate Voting Shares, and an unlimited number of Subordinate Voting Shares, each of which is convertible into 1/100 Proportionate Voting Share. The rights, preferences and protections of the Subordinate Voting Shares and the Proportionate Voting Shares are the same based upon the deemed conversion ratio of 100 Subordinate Voting Shares for one Proportionate Voting Share, such that each Subordinate Voting Share is entitled to one vote and each Proportionate Voting Share is entitled to 100 votes and each Proportionate Voting Share would receive 100 times the amount of any dividends or distributions that are payable for one Subordinate Voting Share.

After the consummation of the RTO the Subordinate Voting Shares were listed on the Canadian Securities Exchange (“CSE”) and began trading on February 17, 2021 under the stock symbol “VRNO”. On October 18, 2023, the Subordinate Voting Shares began trading on Cboe under the stock symbol, “VRNO.” In connection therewith, the Subordinate Voting Shares ceased trading on the CSE as of the close of market on October 17, 2023.

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~~Credit~~After ~~Agreement~~the consummation of the RTO, the Subordinate Voting Shares were listed on the Canadian Securities Exchange (“CSE”) and began trading on February 17, 2021 under the stock symbol “VRNO”. On October 18, 2023, the Subordinate Voting Shares began trading on Cboe under the stock symbol “VRNO.” In connection therewith, the Subordinate Voting Shares ceased trading on the CSE as of the close of market on October 17, 2023. The Subordinate Voting Shares were also quoted for trading in the U.S. on the OTCQX under the stock symbol “VRNOF”. On the Continuance Effective Date, the Subordinate Voting Shares ceased trading on Cboe and the Common Stock began trading on Cboe under the same stock symbol “VRNO”, and began to be quoted on the OTCQX under the symbol “VRNO”.

~~On October 27,~~ 2022, ~~Verano and certain of its subsidiaries and affiliates from time-to-time party thereto (collectively, the “Borrowers”), entered into a~~ Credit Agreement (the “2022 Credit Agreement”) with Chicago Atlantic Admin, LLC (“Chicago Atlantic”), as administrative agent for the lenders, and the lenders from time-to-time party thereto (the “Lenders”), pursuant to which the Lenders advanced the Borrowers a $350,000,000 senior secured term loan, all of which was used to repay the principal indebtedness outstanding under the Company's previous senior secured term loan credit facility. In connection with such repayment, such previous credit facility was terminated and is no longer in force or effect.

~~The~~On October 27, 2022, ~~Credit~~Verano ~~Agreement~~and ~~provides~~certain of its subsidiaries and affiliates from time-to-time party thereto (collectively, the “Borrowers”), ~~with~~entered into a Credit Agreement (the ~~right,~~“2022 ~~subject~~Credit toAgreement”) ~~conditions~~with Chicago Atlantic Admin, toLLC ~~request~~(“Chicago anAtlantic”), ~~additional~~as ~~incremental~~administrative ~~term~~agent ~~loan~~for inthe lenders, and the ~~aggregate~~lenders ~~principal~~from ~~amount~~time-to-time ofparty upthereto (the “Lenders”), pursuant to which the Lenders advanced the Borrowers a $~~100~~350,000,000; ~~provided~~senior ~~that~~secured ~~the~~term ~~Lenders~~loan, ~~elect~~all of which was used to ~~fund~~repay ~~such~~the ~~incremental~~amounts owing under the Company's previous senior secured term loan credit facility. ~~Beginning~~In inconnection ~~October~~with ~~2023~~such repayment, ~~the~~such ~~2022~~previous ~~Credit~~credit ~~Agreement~~facility ~~requires~~was ~~Verano~~terminated toand ~~make~~is no longer in force or effect. Beginning in October 2023, Verano made scheduled amortization payments of $350,000 per month and the remaining principal balance iswas due in full on October 30, 2026.

The obligations under the 2022 Credit Agreement ~~also~~were ~~provides~~secured ~~the~~by ~~Borrowers~~substantially ~~with~~all of the ~~right~~assets toof ~~(a)~~the ~~incur~~Borrowers, upexcluding ~~to $120~~vehicles,~~000,000~~ specified parcels of ~~additional~~real ~~indebtedness~~estate ~~from~~and ~~third-party~~other ~~lenders~~customary ~~secured~~exclusions. The by2022 ~~real~~Credit ~~estate~~Agreement ~~excluded~~provided asfor ~~collateral~~a ~~under~~floating annual interest rate equal to the ~~2022~~prime ~~Credit~~rate ~~Agreement,~~then ~~(b)~~in ~~incur~~effect ~~additional~~plus ~~mortgage~~6.50%, ~~financing~~which ~~from~~could ~~third-party~~have ~~lenders~~been ~~secured~~increased by ~~real~~3.00% ~~estate~~upon ~~acquired~~an ~~after~~event ~~the~~of ~~closing~~default ~~date,~~that ~~and~~was ~~(c)~~not ~~upon~~a ~~the~~material ~~SAFE~~event ~~Banking~~of ~~Act~~default or ~~similar~~6.00% ~~legislation~~upon ~~making~~a ~~banking~~material ~~services~~event ~~available~~of ~~to U~~default.S. The ~~cannabis~~2022 ~~companies~~Credit ~~being~~Agreement ~~passed~~included bycustomary ~~the~~representations ~~United~~and ~~States~~warranties, ~~Congress~~covenants and customary events of default, ~~incur~~including, upwithout tolimitation, ~~$50~~payment defaults,~~000~~ breaches of representations and warranties,~~000~~ ~~pursuant~~covenant defaults, cross-defaults to amaterial ~~revolving~~indebtedness, ~~credit~~and ~~facility~~events ~~from~~of ~~third-party~~bankruptcy ~~lenders~~and ~~that~~insolvency. isAdditionally, ~~pari~~the ~~passu~~2022 orCredit ~~subordinated~~Agreement required the Borrowers to meet certain financial tests regarding minimum cash balances, minimum levels of Adjusted EBITDA (as defined in the 2022 Credit Agreement) ~~obligations,~~and ~~each~~a minimum fixed charge coverage ratio. As of ~~which~~December 31, ~~are~~2025, ~~subject~~the toCompany ~~customary~~was in compliance with the terms and conditions of the 2022 Credit Agreement.

~~The~~George ~~obligations~~Archos, ~~under~~the Chairman, Chief Executive Officer and President of the Company, participated in the 2022 Credit Agreement ~~are~~as ~~secured~~a byLender ~~substantially~~funding ~~all~~$1,000,000 of the ~~assets~~$350,000,000 ofprincipal ~~the~~amount. ~~Borrowers,~~Mr. ~~excluding~~Archos ~~vehicles,~~was ~~specified~~excluded ~~parcels~~from certain approval rights of ~~real~~the ~~estate~~lenders and ~~other~~any ~~customary~~penalties ~~exclusions~~and fees due to Mr. Archos under the 2022 Credit Agreement were immaterial to the Company.

~~The~~On ~~2022~~April ~~Credit~~30, ~~Agreement~~2024, ~~provides~~Verano ~~for~~made a ~~floating~~Permitted ~~annual~~Partial ~~interest~~Optional ~~rate~~Prepayment ~~equal~~(as todefined in the ~~prime~~2022 ~~rate~~Credit ~~then~~Agreement) in ~~effect~~the ~~plus~~amount 6.of $50%,000,000 ~~which~~pursuant ~~rate~~to ~~may~~the be2022 ~~increased~~Credit byAgreement 3and paid a $1,000,000 prepayment premium in connection therewith.~~00%~~ ~~upon~~On anSeptember ~~event~~30, of2025, ~~default~~the ~~that~~Company ismade ~~not~~an aadditional ~~material~~Permitted ~~event~~Partial Optional Prepayment in the amount of ~~default~~$50,000,000 orpursuant ~~6.00%~~to ~~upon~~the a2022 ~~material~~Credit ~~event~~Agreement, ofwithout ~~default~~any penalty or premium.

At any time, the Company may voluntarily prepay up to $100,000,000 of the principal balance, subject to a one-time $1,000,000 prepayment premium upon the first prepayment, and may prepay the remaining outstanding principal balance for a prepayment premium at varying rates based on the timing of any subsequent prepayments. The Borrowers may not voluntarily prepay more than $100,000,000 of the principal balance without prepaying the entire outstanding principal balance of the loan. On April 30, 2024, Verano made a Permitted Partial Optional Prepayment (as defined in the 2022 Credit Agreement) in the amount of $50,000,000 pursuant to the 2022 Credit Agreement and paid a $1,000,000 prepayment premium in connection therewith. The Company may voluntarily prepay up to another $50,000,000 following the Permitted Partial Optional Prepayment in April 2024 without any additional prepayment premium. For more information, see “— Certain 2024 Developments — Permitted Partial Optional Prepayment and Lien Release.”

The 2022 Credit Agreement includes customary representations and warranties and customary events of default, including, without limitation, payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to material indebtedness, and events of bankruptcy and insolvency.

The 2022 Credit Agreement also includes customary negative covenants limiting the Borrowers’ ability to incur additional indebtedness and grant liens that are not otherwise permitted, and the ability to enter into or consummate acquisitions or dispositions that are not otherwise permitted, among others. Additionally, the 2022 Credit Agreement requires the Borrowers to meet certain financial tests regarding minimum cash balances, minimum levels of Adjusted EBITDA (as defined in the 2022 Credit Agreement) and a minimum fixed charge coverage ratio.

As of December 31, 2024, the Company was in compliance with such covenants.

George Archos, the Chairman, Chief Executive Officer and Founder of the Company, participated in the 2022 Credit Agreement as a Lender funding $1,000,000 of the $350,000,000 principal amount. Mr. Archos is excluded from certain approval rights of the lenders and any penalties and fees due to Mr. Archos under the 2022 Credit Agreement are immaterial to the Company.

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~~Certain 2024 Developments~~Revolver

~~Business~~On ~~Combinations~~September 30, 2025, the Company entered into a credit agreement (as amended, the “Revolver”), by and among the Company, as a guarantor, certain subsidiaries of the Company from time-to-time party thereto as borrowers (the “Real Estate Subsidiaries”), the lenders from time-to-time party thereto (the “Revolver Lenders”), and Chicago Atlantic, as administrative agent for the Revolver Lenders.

~~203~~The ~~Organix~~Revolver Linitially provided for a $75,000,000 revolving loan facility, $50,000,000 of which was drawn on September 30, 2025 and was used to prepay, without any penalty or premium, $50,000,000 of outstanding obligations due under the 2022 Credit Agreement.L The Revolver provides for a floating annual interest rate on amounts drawn equal to one-month Term SOFR (subject to a minimum 4% SOFR floor) plus 6%, which rate may be increased by 3% upon an event of default or by 6% upon a material event of default as provided in the Revolver.C. &The ~~Salubrious~~Company ~~Wellness~~incurred ~~Clinic~~debt issuance costs of $2,209,700 ~~Inc~~in connection with the establishment of the Revolver.

OnThe ~~July~~Revolver ~~29,~~may ~~2024,~~be ~~the~~drawn ~~Company~~in ~~entered~~$2,500,000 ~~into~~increments ~~two~~upon ~~equity~~ten ~~purchase~~business ~~agreements:,~~days ~~(a)~~prior ~~one~~notice ~~with~~and ~~The~~any ~~Cannabist~~outstanding ~~Company~~amount ~~Holdings~~under ~~Inc.~~the ~~(“Cannabist”),~~Revolver CCmay VAbe ~~Holdco~~voluntarily ~~LLC,~~prepaid ~~Columbia~~in ~~Care~~$2,500,000 –increments ~~Arizona,~~upon ~~Tempe,~~five ~~L.L.C.,~~business ~~Thomas~~days ~~Allison~~prior ~~and~~notice ~~Salubrious~~without ~~Wellness~~any ~~Clinic,~~penalty ~~Inc.~~or ~~(“SWC”)~~premium, ~~pursuant~~unless tosuch ~~which~~prepayment ~~the~~occurs ~~Company~~within ~~acquired~~six ~~all~~months of the ~~issued~~applicable ~~and~~advance, ~~outstanding~~in ~~equity~~which ~~interests of SWC~~case, ~~and~~such ~~(b)~~prepayment ~~one~~will ~~with~~be ~~Cannabist,~~subject CCto VAa ~~Holdco LLC, Columbia Care~~six-~~Arizona,~~month ~~Prescott,~~interest Lmake whole.~~L.C.~~ ~~and~~Any ~~203~~amounts ~~Organix,~~prepaid ~~LLC~~may ~~(“203”~~be ~~and~~redrawn ~~together~~subject ~~with SWC, “Cannabist AZ”), pursuant~~ to ~~which~~funding ~~the~~requirements ~~Company~~set ~~acquired~~forth ~~all~~therein. ofThe ~~the~~Revolver ~~issued~~was ~~and~~initially ~~outstanding~~subject ~~equity~~to ~~interests~~a ofborrowing ~~203.~~base ~~The~~which ~~Company~~required ~~added~~the anoutstanding ~~active~~principal ~~cultivation~~balance ~~and~~under ~~production~~the ~~facility~~Revolver ~~and~~to ~~increased~~be ~~the~~equal ~~Company's~~to ~~retail~~or ~~footprint~~less inthan ~~Arizona.~~60% ~~The~~of ~~transactions~~the ~~closed~~appraised ~~on August 16~~value, ~~2024.~~net ~~Pursuant~~of tocertain ~~such equity purchase agreements~~indebtedness, of the ~~Company~~owned ~~paid~~real ~~total~~estate ~~cash~~serving ~~consideration~~as ofcollateral ~~$11,529,000,~~for ~~inclusive~~the ofRevolver ~~estimated~~from ~~ongoing~~time ~~post-closing~~to ~~purchase price adjustments~~time.

~~Columbia~~The ~~Care~~obligations ~~Eastern~~under ~~Virginia~~the ~~LLC~~Revolver are secured by substantially all of the assets of the Real Estate Subsidiaries, which primarily consistent of owned real estate, and are guaranteed by the Company on an unsecured basis. Additionally, the Revolver allows for the proportionate release of certain Real Estate Subsidiaries upon request of the Company so long as the outstanding principal balance under the Revolver does not exceed 80% of the appraised value, net of certain indebtedness, of the owned real estate serving as collateral after giving effect to such release.

InThe ~~addition~~Revolver toincludes ~~the~~customary ~~equity~~representations, ~~purchase~~warranties, ~~agreements~~covenants ~~entered~~and ~~into~~customary ~~with~~events ~~Cannabist~~of AZdefault, ~~on July 29~~including, ~~2024,~~without ~~the Company entered into an equity purchase agreement with Cannabist~~limitation, ~~Columbia~~payment ~~Care Eastern Virginia LLC (“CC East Virginia”)~~defaults, ~~and~~breaches ~~the members~~ of CCrepresentations ~~East~~and ~~Virginia~~warranties, ~~party~~covenant ~~thereto (the “Virginia EPA”)~~defaults, ~~pursuant~~cross-defaults to ~~which~~material ~~the~~indebtedness, ~~Company~~and ~~acquired~~events ~~all~~ of ~~the~~bankruptcy ~~issued~~ and ~~outstanding equity interests of CC East Virginia~~insolvency. The CCRevolver ~~East~~also ~~Virginia~~includes iscustomary ~~the~~covenants, ~~sole~~including, ~~vertical~~without ~~cannabis operator in HSA 5 in Eastern Virginia. The transaction closed on August 21~~limitation, ~~2024~~limiting (the ~~“VA~~Real ~~Closing~~Estate ~~Date”).~~Subsidiaries’ ~~Pursuant~~ability to ~~the~~incur ~~Virginia~~additional ~~EPA~~indebtedness, ~~the~~make ~~Company~~guarantees ~~paid $24,122,000 in cash consideration~~ and ~~equity~~grant ~~consideration~~liens ofthat ~~10,416,041~~are ~~Subordinate~~otherwise ~~Voting~~not ~~Shares~~permitted ~~with~~and anenter ~~estimated~~into ~~fair~~or ~~value~~consummate ofacquisitions ~~$34,453,000,~~or ~~all~~dispositions ofthat ~~which~~are ~~was~~not ~~distributed~~otherwise topermitted, ~~the~~among ~~equity~~others. ~~holders~~As of ~~CC East Virginia on the VA Closing Date. In addition~~December 31, ~~on the VA Closing Date~~2025, the Company ~~issued~~was ain ~~$27,425,000~~compliance ~~promissory note (the “CC East Virginia Promissory Note”), inclusive of estimated ongoing post-closing purchase price adjustments,~~ with ansuch ~~estimated fair value of $25,776,000 and which bears interest at a rate of 7% per annum and matures on the two-year anniversary of the VA Closing Date~~covenants.

Permitted Partial Optional Prepayment and Lien Release

On April 30, 2024, the Company made a Permitted Partial Optional Prepayment (as defined in the 2022 Credit Agreement) in the amount of $50,000,000 pursuant to the 2022 Credit Agreement and paid a $1,000,000 prepayment premium in connection therewith.

In connection with such Permitted Partial Optional Prepayment, Chicago Atlantic and certain Lenders agreed to (a) release certain Borrowers from their obligations under, and as parties to, the 2022 Credit Agreement and related agreements (the “Released Borrowers”) and (b) release all liens over the Released Borrowers’ property, including real estate, held by Chicago Atlantic for the benefit of the Lenders, in each case, pursuant to a limited consent and waiver, dated as of April 29, 2024, by and among the Borrowers, certain of the Lenders party thereto and Chicago Atlantic.

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~~Organizational~~Certain ~~Structure~~2026 Developments

~~Verano~~On isJanuary a12, ~~holding~~2026, ~~company~~the ~~and~~Company, ~~conducts~~the ~~its~~Real ~~business~~Estate ~~operations~~Subsidiaries, ~~through~~the ~~direct~~Revolver Lenders and ~~indirect~~Chicago ~~subsidiaries~~Atlantic ~~and~~entered ~~affiliates.~~into ~~The~~a ~~following~~First ~~chart~~Amendment ~~sets~~(the ~~forth~~“Revolver ~~the~~First ~~corporate~~Amendment”) ~~structure~~to ofCredit Agreement and Omnibus First Amendment to Credit Documents, to amend the ~~Company~~Revolver and ~~its~~related ~~primary~~credit ~~subsidiary,~~documents ~~Verano~~initially ~~LLC~~entered into on September 30, 2025. The AsRevolver ~~part~~First ofAmendment increased the ~~implementation~~lending commitment of the GoRevolver ~~Public~~from ~~Transactions~~$75,000,000 ~~and~~to ~~tax considerations~~$100,000,000 ~~through~~and aamended ~~series~~the ofdate ~~transactions,~~on ~~the~~which ~~Company~~all ~~formed~~outstanding ~~two~~amounts ~~levels~~are ofdue ~~subsidiaries~~in ~~above~~full ~~Verano~~from ~~LLC~~September ~~that~~29, ~~include~~2028 ~~Verano~~to ~~Holdings~~February ~~USA~~28, ~~Corp~~2029. Additionally, athe ~~Delaware~~Revolver ~~corporation~~First ~~(“BlockerCo”),~~Amendment ~~and~~amended ~~five~~the ~~subsidiaries~~borrowing ofbase ~~BlockerCo,~~for ~~those~~the ~~being~~Revolver ~~ZNN~~to ~~Holdings,~~an ~~LLC,~~advance arate ~~Delaware~~of ~~limited~~up ~~liability~~to ~~company~~80%, ~~Nuuvn~~rather ~~Holdings,~~than ~~LLC~~60%, aof ~~Delaware~~the ~~limited~~appraised ~~liability company~~value, ~~ZenNorth~~net ~~LLC,~~of acertain ~~Delaware~~indebtedness, ~~limited~~of ~~liability~~the ~~company,~~owned ~~A&T~~real ~~SPV~~estate IIserving ~~LLC,~~as acollateral ~~Texas~~for ~~limited~~the ~~liability~~Revolver. ~~company,~~The ~~and~~Revolver ~~SGI~~First 1Amendment ~~LLC,~~also aincludes ~~Delaware~~certain ~~limited~~other ~~liability~~immaterial ~~company~~updates ~~(collectively,~~to the ~~“Blocker Subsidiaries”)~~Revolver. ~~Each~~No ofadditional collateral was pledged to secure the ~~Blocker~~Revolver ~~Subsidiaries~~and ~~were~~certain ~~dissolved~~real inestate ~~February~~may ~~2025~~be ~~and~~released as acollateral ~~result~~upon specified conditions, ~~Verano~~as ~~LLC~~originally ~~became~~provided. Amounts adrawn ~~direct~~under ~~wholly-owned~~the ~~subsidiary~~Revolver ofdo ~~BlockerCo.~~not ~~BlockerCo~~require ~~has,~~amortization ~~and~~payments ~~prior~~with toall ~~the~~outstanding ~~dissolutions,~~amounts ~~the~~being ~~Blocker~~due ~~Subsidiaries~~in ~~had~~full noon ~~business~~the ormaturity ~~operations~~date ~~and~~of ~~exist~~February 28, or2029. ~~existed,~~On asMarch ~~applicable~~11, ~~solely~~2026, ~~to effect~~ the GoCompany ~~Public~~drew ~~Transactions~~$50,000,000 ~~and~~under the ~~taxation~~Revolver, ofbringing ~~Verano~~the astotal aamount ~~U.S.~~drawn ~~corporation~~under ~~for~~the ~~U.S.~~Revolver ~~federal~~to ~~income~~$100,000,000, ~~tax~~which ~~purposes.~~was ~~The~~used ~~below~~to ~~structure~~repay ~~chart shows~~ the ~~structure~~amounts ofowing under the ~~Company~~2022 Credit Agreement, as offurther ~~February 25,~~discussed ~~2025~~below.

~~From~~On ~~time~~March to11, ~~time~~2026, weVerano ~~may~~and ~~reorganize~~certain ~~our~~of ~~operating~~its subsidiaries ~~through~~and ~~consolidations~~affiliates from time-to-time party thereto (collectively, ~~mergers~~the “2026 Borrowers”), ~~contributions~~entered into a Credit Agreement (the “2026 Credit Agreement”) with Needham Bank (“Needham”), ~~distributions~~as collateral agent and ~~similar~~administrative ~~corporate~~agent ~~restructurings~~for inthe ~~order~~lenders, Chicago Atlantic Financial Services, LLC, as co-administrative agent for the lenders, and the lenders from time-to-time ~~integrate~~party ~~acquired~~thereto ~~companies~~(the “2026 Lenders”), ~~enhance~~pursuant ~~efficiencies~~to which the 2026 Lenders advanced the 2026 Borrowers a $195,000,000 ~~streamline~~senior ~~operations~~secured term loan, ~~group~~all ~~borrowers~~of which was used to repay the amounts owing under the 2022 Credit Agreement. In connection with such repayment, the Company paid a prepayment premium of approximately $4,345,000 and ~~align~~the ~~financial~~2022 ~~reporting.~~Credit ~~After~~Agreement ~~giving~~was terminated and is no longer in force or effect. Beginning in April 2026, Verano will be required to ~~any~~make ~~corporate~~scheduled ~~reorganization~~amortization payments of $875,000 ~~all~~per ~~operating~~month ~~entities~~and ~~remain~~the asremaining ~~indirect~~principal ~~subsidiaries~~balance is due in full on March 11, 2029; provided that the maturity date may be extended to March 11, 2030 upon the election of the Company, the payment of 1.5% ~~See~~of ~~Exhibit~~the 21then outstanding principal balance by the Company, and the consent of the 2026 Lenders.1 toThe ~~this~~2026 ~~Form~~Credit Agreement may be prepaid in part (in increments of $5,000,000 and in an amount not less than $10-K,000,000) ~~for~~or in full at any time, subject to a ~~list~~1.5% ofprepayment ~~subsidiaries~~premium ofduring the ~~Company~~first astwo years of ~~December 31~~the 2026 Credit Agreement and 0% thereafter; provided, ~~2024~~that if the maturity date is extended to March 11, 2030, the prepayment premium will be 1.5% in all cases.

~~Because~~The ofobligations ~~this~~under ~~holding~~the ~~company~~2026 ~~structure,~~Credit ~~Verano~~Agreement ~~has~~are nosecured ~~business~~by ~~operations~~substantially ~~and~~all toof the ~~extent~~assets itof ~~cannot~~the ~~raise~~2026 ~~funds~~Borrowers, ~~through~~excluding ~~the~~vehicles, ~~issuance~~specified parcels of ~~debt~~real ~~or equity securities~~estate, itother iscustomary ~~dependent~~exclusions onand ~~the~~subject ~~financial~~to ~~health~~compliance ~~and~~with ~~operating~~the ~~performance~~terms of ~~its~~the ~~subsidiaries~~2026 ~~and~~Credit ~~affiliates~~Agreement, toentities, ~~meet~~assets ~~its~~and ~~financial~~parcels ~~obligations. The ability~~ of ~~Verano’s~~real ~~subsidiaries~~estate ~~and~~acquired ~~affiliates~~after tothe ~~pay~~closing ~~dividends~~of ~~and~~the ~~other~~2026 ~~distributions~~Credit toAgreement. The it2026 orCredit ~~any~~Agreement ofprovides ~~its~~for ~~other~~a ~~subsidiaries~~floating ~~will~~annual ~~depend~~interest onrate ~~their~~equal ~~operating~~to ~~results~~one-month ~~and~~Term ~~will~~SOFR be (subject to ~~applicable~~a ~~laws~~minimum ~~and~~4% ~~regulations~~SOFR ~~which~~floor) ~~require~~plus ~~that~~5.5%, ~~solvency~~which ~~and~~rate ~~capital~~may ~~standards~~ be ~~maintained,~~increased asby ~~well~~5% asupon ~~contractual~~an ~~restrictions~~event onof ~~dividends~~default ~~and~~as ~~distributions~~provided ~~that~~in ~~may~~the be2026 ~~contained~~Credit inAgreement. ~~mortgages,~~The ~~credit~~2026 ~~facilities~~Credit ~~and~~Agreement ~~other~~included ~~similar~~customary ~~agreements.~~representations Inand ~~the~~warranties, ~~event~~covenants ofand acustomary ~~liquidation~~events ~~or reorganization~~ of ~~any~~default, ofincluding, ~~Verano’s~~without ~~subsidiaries~~limitation, ~~lenders~~payment ~~and~~defaults, ~~trade~~breaches ~~creditors~~of ~~may~~representations beand ~~entitled~~warranties, tocovenant ~~payment~~defaults, ofcross-defaults ~~their~~to ~~claims~~material ~~from~~indebtedness, ~~the~~and ~~assets~~events of ~~such~~bankruptcy ~~subsidiary~~and ~~before Verano~~insolvency.

Additionally, the 2026 Credit Agreement requires the Borrowers to meet certain financial tests regarding minimum cash balances and a minimum fixed charge coverage ratio.

George Archos, the Chairman, Chief Executive Officer and President of the Company, funded, through an affiliated entity, $10,000,000 of the amount provided by a 2026 Lender. As a result of this participation, Mr. Archos will receive his pro rata share of all interest and principal payments made by the Company to such 2026 Lender under the 2026 Credit Agreement.

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Organizational Structure

Verano is a holding company and conducts its business operations through direct and indirect subsidiaries and affiliates. The following chart sets forth the corporate structure of the Company and its primary subsidiary, Verano LLC. As part of the implementation of the Go Public Transactions and tax considerations, the Company formed two levels of subsidiaries above Verano LLC that included Verano Holdings USA Corp., a Delaware corporation (“BlockerCo”), and five subsidiaries of BlockerCo, those being ZNN Holdings, LLC, a Delaware limited liability company, Nuuvn Holdings, LLC, a Delaware limited liability company, ZenNorth LLC, a Delaware limited liability company, A&T SPV II LLC, a Texas limited liability company, and SGI 1 LLC, a Delaware limited liability company (collectively, the “Blocker Subsidiaries”). Each of the Blocker Subsidiaries were dissolved in February 2025 and as a result, Verano LLC became a direct wholly-owned subsidiary of BlockerCo. BlockerCo has no, and prior to the dissolutions, the Blocker Subsidiaries had no, business or operations and exist, or existed, as applicable, solely to effect the Go Public Transactions and the taxation of Verano as a U.S. corporation for U.S. federal income tax purposes. The below structure chart shows the structure of the Company as of March 10, 2026.

From time to time, we may reorganize our operating subsidiaries through consolidations, mergers, contributions, distributions and similar corporate restructurings in order to integrate acquired companies, enhance efficiencies, streamline operations, group borrowers under our credit facilities and align financial reporting. After giving effect to any corporate reorganization, all operating entities have remained as indirect subsidiaries or affiliates of the Company. See Exhibit 21.1 to this Form 10-K for a list of subsidiaries of the Company as of December 31, 2025.

Because of this holding company structure, Verano has no business operations and to the extent it cannot raise funds through the issuance of debt or equity securities, it is dependent on the financial health and operating performance of its subsidiaries and affiliates to meet its financial obligations. The ability of Verano’s subsidiaries and affiliates to pay dividends and other distributions to it or any of its other subsidiaries will depend on their operating results and will be subject to applicable laws and regulations which require that solvency and capital standards be maintained, as well as contractual restrictions on dividends and distributions that may be contained in credit facilities, mortgages and other similar agreements. In the event of a liquidation or reorganization of any of Verano’s subsidiaries or affiliates, lenders and trade creditors may be entitled to payment of their claims from the assets of such subsidiary or affiliates before Verano.

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In certain jurisdictions the Company has agreements in place with third parties that provide us contractual rights with respect to ownership, management services, consulting or licensing, or a combination thereof, with respect to the applicable licenses and related cannabis businesses being conducted pursuant thereto (each such agreement, a “Management Services Agreement”).

Our Strategy

As an operator of licensed cannabis cultivation, processing, wholesale distribution and retail facilities, Verano’s goal is ~~the~~to ~~ongoing~~support ~~development of~~ communal wellness by providing responsible access to regulated medical and adult use ~~regulated~~ cannabis products.

Our strategy is to vertically integrate as a single cohesive company in multiple states through the consolidation of seed-to-sale cultivating, ~~processing~~manufacturing, ~~wholesale~~ distributing, and dispensing ~~branded~~cannabis brands and products at scale. Our cultivation, processing and ~~wholesale~~ distribution of cannabis consumer packaged goods are designed to support our ~~national~~ retail ~~dispensary~~dispensaries, ~~chains~~as ~~and~~well as, to develop and foster long term wholesale supply relationships with third-party retail ~~dispensary~~ operators. ~~Our~~We ~~retail~~also ~~dispensary~~design, ~~chains~~build and operate ~~under~~branded ~~brand~~dispensaries ~~names~~operating ~~including~~under the Zen Leaf™ and MÜV™, ~~and~~retail webanners, ~~developed~~among ~~this~~others, ~~model~~that indeliver ~~part~~a tocannabis ~~leverage~~shopping ~~shelf-space~~experience in ~~our~~both ~~retail~~medical ~~dispensaries~~and adult use markets. As of ~~February~~March 2510, ~~2025~~2026, we also have several dispensaries operating under the Cannabist or SWC brand name following our acquisitions of Salubrious Wellness Clinic, Inc. (“SWC”), 203 Organix, LLC (together with SWC, “Cannabist AZ”) and Columbia Care Eastern Virginia LLC (“CC East Virginia”).

Our ~~strategy~~model includes ~~geographic diversity by~~ establishing a diverse geographic footprint tothat ~~enable~~allows us to adapt to changes in both industry and market conditions. We have pursued this strategy of geographic diversity through acquisitions and organic growth funded by internally generated cashflow, the issuance of ~~Subordinate Voting Shares and Proportionate Voting Shares~~equity, deferred purchase price payments and the incurrence of indebtedness.

We believe that the following business objectives have positioned Verano for continued growth.

•The Company’s business plan centers around four foundational pillars: cultivation, production, brand development and retail.

•Diversity in geographic revenue streams helps position the Company to respond proactively to changes in economics, regulations and healthcare, as well as to navigate ever-evolving consumer habits.

•The Company strives to operate and manage the entire vertical cannabis operation and supply chain from seed-to- sale.

•The Company focuses on a current potential market size of approximately 89 million adult Americans based on BDSA.com, which includes the total adult population in the 13 states in which we currently have active operations, those states being Arizona, Connecticut, Florida, Illinois, Maryland, Massachusetts, Michigan, Nevada, New Jersey, Ohio, Pennsylvania, Virginia and West Virginia.

•The Company aims for a “first-mover” competitive advantage in emerging markets by seeking early entry into states with approved medical cannabis programs and then establishing a footprint and vertical operations ~~in anticipation of the authorization of adult use cannabis~~.

•The Company emphasizes developing high-quality products at various price points to elevate its products’ market desirability and value.

•The Company aims to adhere to standard operating procedures across all of its cultivation and processing facilities, ~~growing~~producing ~~with~~ state-permitted products and implementing compliance programs to meet product testing, inventory controls and other state regulatory requirements.

•The Company espouses a customer and patient driven business philosophy aiming to deliver value to its downstream patients and consumers.

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Regulatory Framework in the United States

The U.S. regulatory scheme varies in its terminology and definitions, using “cannabis”, “marijuana” and “hemp” as distinct terms. For purposes of this Form 10-K, the term “cannabis” means “marijuana” as set forth in the Controlled Substances Act ~~(21 U.S.C. § 811) (the “Controlled Substances Act” or the “CSA”)~~ and is used interchangeably with the term “marijuana.”

To date, in the U.S. 3840 states plus the District of Columbia and the U.S. territories of Puerto Rico, Guam, the Commonwealth of Northern Marina Islands, and the U.S. Virgin Islands have authorized comprehensive medical cannabis programs, 24 states plus the District of Columbia and the U.S. territories of Guam, the Commonwealth of Northern Mariana Islands, and the U.S. Virgin Islands have authorized comprehensive programs for medical and adult use (i.e. recreational) cannabis, and 7eight states allow the use of low THC and high CBD products for specified medical uses. Notwithstanding the permissive regulatory environment of medical, and in some cases, adult use cannabis, at the state level, it remains illegal under U.S. federal law to cultivate, manufacture, distribute, sell or possess cannabis in the United States. Because U.S. federal law prohibits transporting any federally restricted substance across state lines, cannabis cannot be transported across state lines. As a result of federal law prohibitions, the U.S. cannabis industry is conducted on a state-by-state basis, and we rely on established and developing laws and regulations in the states and local jurisdictions in which we operate. In addition, financial transactions involving proceeds generated by, or intended to promote, cannabis-related business activities in the U.S. may form the basis for prosecution under applicable U.S. federal money laundering legislation. On December 18, 2025, President Trump issued the Executive Order, which directs federal agencies to expedite the process of rescheduling cannabis from a Schedule I to a Schedule III controlled substance under the CSA. The effect of the Executive Order may be that the cultivation, manufacturing, distribution, sale or possession of cannabis in the U.S. is no longer federally illegal and would lessen criminal penalties at the federal level and remove Section 280E tax considerations, however, the final effects are dependent on other government actions. Despite such actions and the ongoing rule making process, there can be no guarantees that the rescheduling rule making process will continue on a certain timeline or at all under this administration or that any rules will come out of the rule making process that will benefit the Company.

Regulation of Cannabis at the U.S. Federal Level

The U.S. federal government’s approach to enforcement of cannabis laws has trended toward deference to state laws where a robust state regulatory framework exists. In August 2013, the U.S. Department of Justice (the “DOJ”) issued a memorandum known as the “Cole Memorandum” to all U.S. Attorneys’ offices. The Cole Memorandum generally directed U.S. Attorneys not to prioritize the enforcement of federal cannabis laws against individuals and businesses that comply with state cannabis programs. The Cole Memorandum, while not legally binding and only a policy statement, assisted in managing the tension between state and federal laws concerning all medical and adult use state-regulated cannabis businesses.

In January 2018, the Cole Memorandum was rescinded by former Attorney General Jeff Sessions. While this did not create a change in federal law, the revocation added to the uncertainty of U.S. federal enforcement of the Controlled Substances Act in states where cannabis use is regulated. Former Attorney General Jeff Sessions also issued a one-page memorandum known as the “Sessions Memorandum” which confirmed the rescission of the Cole Memorandum and explained that the Cole Memorandum was “unnecessary” due to existing general enforcement guidance as set forth in the U.S. Attorney’s Manual. While the Sessions Memorandum does emphasize that marijuana is a Schedule I controlled substance, it does not otherwise indicate that the prosecution of marijuana-related offenses is a heightened DOJ priority. The Sessions Memorandum explicitly describes itself as a guide to prosecutorial discretion, which remains in the hands of U.S. Attorneys when deciding whether to prosecute marijuana-related offenses. No direction was given to federal prosecutors in the Sessions Memorandum as to the priority they should ascribe to such cannabis activities, and the Sessions Memorandum did not address the treatment of medical cannabis by federal prosecutors.

Former President Joe Biden, who assumed office in January 2021, stated a policy goal of federal cannabis decriminalization. In March 2021, Merrick Garland was appointed U.S. Attorney General by Former President Biden. Mr. Garland indicated he would generally act in accordance with the Cole Memorandum,. ~~when~~In December 2022, atPresident ~~his~~Biden ~~confirmation~~signed ~~hearing,~~The heMedical ~~said~~Marijuana and Cannabidiol Research Expansion Act. This Act, ~~“It~~the ~~does~~first ~~not~~standalone ~~seem~~cannabis bill to mebe passed by Congress, reduces federal barriers to cannabis research, creates a ~~useful~~mechanism ~~use~~for ofthe ~~limited~~Food ~~resources~~and ~~that~~Drug weAdministration ~~have,~~(the “FDA”) to beapprove ~~pursuing~~products ~~prosecutions~~derived infrom ~~states~~cannabis, ~~that~~protects ~~have~~state-licensed ~~legalized~~physicians who certify patients for medical cannabis use, requires the U.S. Department of Health and ~~that~~Human ~~are~~Services ~~regulating~~to report on the ~~use~~potential therapeutic benefits of ~~marijuana~~cannabis, ~~either~~and ~~medically~~requires orthe ~~otherwise~~Attorney General to annually review whether a sufficient amount of cannabis is being produced to meet the needs of medical cannabis research.”

In December 2022, President Biden signed The Medical Marijuana and Cannabidiol Research Expansion Act. This Act, the first standalone cannabis bill to be passed by Congress, reduces federal barriers to cannabis research, creates a mechanism for the Food and Drug Administration (the “FDA”) to approve products derived from cannabis, protects state-licensed physicians who certify patients for medical cannabis use, requires the U.S. Department of Health and Human Services to report on the potential therapeutic benefits of cannabis, and requires the Attorney General to annually review whether a sufficient amount of cannabis is being produced to meet the needs of medical cannabis research.

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On August 29, 2023, the Department of Health and Human Services (“HHS”) recommended that cannabis should be placed in Schedule III of the Controlled Substances Act. This recommendation is based off the FDA analysis which recommends control in Schedule III as well as the National Institute on Drug Abuse’s review and concurrence. HHS conducted a review of the FDA’s consideration of the following eight factors: (1) actual or relative potential for abuse; (2) scientific evidence of its pharmacological effect, if known; (3) the state of current scientific knowledge regarding the drug or other substance; (4) historical and current patterns of abuse; (5) the scope, duration, and significance of abuse; (6) risks to public health; (7) its psychic or physiological dependence liability; and (8) whether the substance is an immediate precursor of a substance already controlled. After such review, HHS found that (i) cannabis’s potential for abuse is less than the drugs or other substances in schedules I and III, (ii) cannabis has a currently accepted medical use in treatment in the United States, and (iii) cannabis poses a moderate to low risk of physical dependence or high psychological dependence.

On May 21, 2024, the U.S. Justice Department announced that Attorney General Merrick Garland submitted to the Federal Register a notice of proposed rule making initiating a formal rule making process to consider moving cannabis from a Schedule I to Schedule III drug under the CSA. On December 2, 2024, the DEA held a preliminary formal hearing regarding the rescheduling of cannabis, and additional hearings were scheduled from January 21, 2025 to March 6, 2025. On January 13, 2025, the Chief Administrative Law Judge presiding over the rescheduling of cannabis ordered that the hearing scheduled for January 21, 2025, be cancelled, and that the proceedings in the matter were stayed, pending a resolution of an interlocutory appeal to the DEA administrator. A joint status update must be provided to the tribunal ninety (90) days from the issuance of the order, and every ninety (90) days thereafter.

In November 2024, Donald Trump was elected President of the United States, and later that month announced that Pam Bondi would be his nominee for Attorney General. On the campaign trail, Donald Trump expressed his support for moving cannabis to a Schedule III substance and expressed his commitment to work with Congress to pass common sense cannabis laws, including safe banking laws, for state authorized companies. Despite such statements and the ongoing rule making process, there can be no guarantees that the rescheduling rule making process will continue on a certain timeline or at all under the new administration or that any rules will come out of the rule making process that will benefit the Company.

The Company is also subject to a variety of federal laws and regulations in the U.S. and Canada that relate to money laundering, financial recordkeeping and proceeds of crime, including the Currency and Foreign Transactions Reporting Act of 1970 (commonly known as the “Bank Secrecy Act”), as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), the Criminal Code (Canada), in each case as amended and any related or similar rules, regulations or guidelines of governmental authorities in the U.S. and Canada. Further, under U.S. federal law, banks or other financial institutions that provide a cannabis business with a checking account, debit or credit card, small business loan, or any other service could be found guilty of money laundering, aiding and abetting, or conspiracy.

Additionally, under U.S. federal law it may be a violation of federal money laundering statutes for financial institutions to take any proceeds from the sale of cannabis or any other Schedule I controlled substance. Banks and other financial institutions, particularly those that are federally chartered in the U.S., could be prosecuted and possibly convicted of money laundering for providing services to cannabis businesses. The Company may also be considered in violation of federal money laundering statutes for “federal health care law violations,” which include violations of the Federal Food, Drug, and Cosmetic Act of 1938 (“FDCA”).

In February 2014, the Financial Crimes Enforcement Network of the Treasury Department issued a memorandum (the “FinCEN Memorandum”) providing instructions to banks seeking to provide services to cannabis-related businesses. The FinCEN Memorandum clarifies how financial institutions can provide services to cannabis-related businesses consistent with their Bank Secrecy Act obligations. It refers to supplementary guidance that Deputy Attorney General Cole issued to federal prosecutors relating to the prosecution of money laundering offenses predicated on cannabis-related violations of the Controlled Substances Act and independently lists the federal government’s enforcement priorities as related to cannabis. Although the original FinCEN Memorandum is still in place, this supplementary DOJ guidance that accompanied the FinCEN Memorandum was rescinded when former Attorney General Sessions rescinded the Cole Memorandum. Despite the attempt to legitimize cannabis banking, in practice the FinCEN Memorandum guidance has not made banks much more willing to provide services to cannabis businesses. The current law does not guarantee banks immunity from prosecution, and it also requires banks and other financial institutions to undertake time-consuming and costly due diligence on each cannabis business they take as a customer.

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~~Due~~On toAugust ~~financial~~29, ~~institutions~~2023, ~~concerns~~the Department of ~~being~~Health ~~implicated~~and inHuman orServices ~~prosecuted~~(“HHS”) ~~for~~recommended ~~money~~that ~~laundering,~~ cannabis ~~businesses~~be ~~are~~placed ~~often~~in ~~forced~~Schedule ~~into~~III ~~becoming~~of ~~“cash-only”~~the ~~businesses~~Controlled Substances Act. AsThis ~~banks~~recommendation ~~and~~is ~~other~~based ~~financial~~on ~~institutions~~FDA analysis which recommends control in Schedule III as well as the ~~U.S.~~National ~~are~~Institute ~~generally~~on ~~unwilling~~Drug toAbuse’s ~~risk~~review and concurrence. HHS conducted a ~~potential~~review ~~violation~~of the FDA’s consideration of ~~federal~~the ~~law~~following ~~without~~eight ~~guaranteed~~factors: ~~immunity~~(1) ~~from~~actual ~~prosecution,~~or ~~most~~relative ~~refuse~~potential tofor ~~provide~~abuse; ~~any~~(2) ~~kind~~scientific evidence of ~~services~~its topharmacological ~~cannabis~~effect, ~~businesses.~~if ~~The~~known; ~~few~~(3) ~~credit~~the ~~unions~~state ~~and~~of ~~community~~current ~~banks~~scientific ~~who~~knowledge ~~have~~regarding ~~agreed~~the todrug ~~work~~or ~~with~~other ~~cannabis~~substance; ~~businesses~~(4) ~~are~~historical ~~limiting~~and ~~those~~current ~~accounts~~patterns inof ~~relation~~abuse; (5) the scope, duration, and significance of abuse; (6) risks to ~~their~~public ~~total~~health; ~~deposits.~~(7) ~~Since~~its ~~the~~psychic ~~federal~~or ~~government~~physiological ~~could~~dependence ~~change~~liability; ~~the~~and ~~banking~~(8) ~~laws~~whether asthe itsubstance ~~relates~~is toan ~~cannabis~~immediate ~~businesses~~precursor atof ~~any~~a ~~time~~substance ~~and~~already ~~without~~controlled. ~~notice~~After such review, ~~these~~HHS ~~credit~~found ~~unions~~that ~~must~~(i) ~~keep~~cannabis’s ~~sufficient~~potential ~~cash~~for onabuse ~~hand~~is toless bethan ~~able~~the todrugs ~~return~~or ~~the~~other ~~full~~substances ~~value~~in Schedules I and III of ~~all~~the ~~deposits~~CSA, ~~from~~(ii) cannabis ~~businesses~~has a currently accepted medical use in atreatment ~~single~~in ~~day~~the United States, ~~while~~and ~~also~~(iii) ~~servicing~~cannabis ~~the~~poses ~~need~~a moderate to low risk of ~~other~~physical ~~customers~~dependence or high psychological dependence.

On December 18, 2025, President Trump issued the Executive Order, which directs federal agencies to expedite the process of rescheduling cannabis from a Schedule I to a Schedule III controlled substance under the CSA. The effect of the Executive Order may be that the cultivation, manufacturing, distribution, sale or possession of cannabis in the U.S. is no longer federally illegal and would lessen criminal penalties at the federal level and remove Section 280E tax considerations, however, the final effects are dependent on other government actions. Despite such actions and the ongoing rule making process, there can be no guarantees that the rescheduling rule making process will continue on a certain timeline or at all under this administration or that any rules will come out of the rule making process that will benefit the Company. The order, and agency implementation of the order does not federally legalize adult use and would not federally authorize or approve state sanctioned medical programs. Cannabis would still be subject to the same FDA drug approval process as all other substances, and sales outside of FDA approval, would still be criminal at the federal level.

The Company is also subject to a variety of federal laws and regulations that relate to money laundering, financial recordkeeping and proceeds of crime, including in the U.S., the Currency and Foreign Transactions Reporting Act of 1970 (commonly known as the “Bank Secrecy Act”), as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), in each case as amended and any related or similar rules, regulations or guidelines of governmental authorities in the U.S.. As an SEC Foreign Issuer, we may be subject to similar applicable laws in Canada. Further, under U.S. federal law, banks or other financial institutions that provide a cannabis business with a checking account, debit or credit card, small business loan, or any other service could be found guilty of money laundering, aiding and abetting, or conspiracy. It is unclear what effect, if any, the Executive Order will have on these U.S. federal laws and regulations.

Additionally, under U.S. federal law it may be a violation of federal money laundering statutes for financial institutions to take any proceeds from the sale of cannabis or any other CSA Schedule I controlled substance. Banks and other financial institutions, particularly those that are federally chartered in the U.S., could be prosecuted and possibly convicted of money laundering for providing services to cannabis businesses. The Company may also be considered in violation of federal money laundering statutes for “federal health care law violations,” which include violations of the Federal Food, Drug, and Cosmetic Act of 1938 (“FDCA”).

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In February 2014, the Financial Crimes Enforcement Network of the U.S. Treasury Department issued a memorandum (the “FinCEN Memorandum”) providing instructions to banks seeking to provide services to cannabis-related businesses. The FinCEN Memorandum clarifies how financial institutions can provide services to cannabis-related businesses consistent with their Bank Secrecy Act obligations. It refers to supplementary guidance previously issued to federal prosecutors relating to the prosecution of money laundering offenses predicated on cannabis-related violations of the Controlled Substances Act and independently listed the U.S. federal government’s enforcement priorities as related to cannabis. Although the original FinCEN Memorandum is still in place, this supplementary DOJ guidance that accompanied the FinCEN Memorandum was rescinded when former Attorney General Sessions rescinded the Cole Memorandum. Despite the attempt to legitimize cannabis banking, in practice the FinCEN Memorandum guidance has not made banks much more willing to provide services to cannabis businesses. The current law does not guarantee banks immunity from prosecution, and it also requires banks and other financial institutions to undertake time-consuming and costly due diligence on each cannabis business they accept as a customer.

Due to financial institutions concerns of being implicated in or prosecuted for money laundering, cannabis businesses are often forced into becoming “cash-only” businesses. As banks and other financial institutions in the U.S. are generally unwilling to risk a potential violation of federal law without guaranteed immunity from prosecution, most refuse to provide any kind of services to cannabis businesses. The credit unions and banks who have agreed to work with cannabis businesses are limiting those accounts in relation to their total deposits. Since the federal government could change the banking laws as it relates to cannabis businesses at any time and without notice, these financial institutions must keep sufficient cash on hand to be able to return the full value of all deposits from cannabis businesses in a single day, while also servicing the need of other customers.

In the absence of comprehensive reform of federal cannabis legislation that would decriminalize the cannabis industry, a growing number of members of the U.S. Congress (“Congress”) have expressed support for federal legislation that would eliminate the financing activity of businesses operating under state-sanctioned cannabis programs from the scope of federal money laundering statutes. In September 2019, the U.S. House of Representatives (the “House”) first passed the Secured and Fair Enforcement Banking Act of 2019 (commonly known as the “SAFE Banking Act”), which aims to provide safe harbors and guidance to financial institutions that work with legal U.S. cannabis businesses, as a standalone bill but it failed to be taken up by the U.S. Senate (“Senate”). The language of the SAFE Banking Act has been attached to various proposed legislation, but the language has not been included in any final legislation. To date, the SAFE Banking Act has passed the House a total of six times either as a standalone bill or attached to other legislation, most recently in February 2022 as an amendment to the America Competes Act (the “COMPETES Act”). However, the amendment was removed from the Senate version of the bill and was not included in the final version of the COMPETES Act amendment.

In June 2022, a variation on the SAFE Banking Act’s federal banking and financing protections was introduced. The bipartisan Capital Lending and Investment for Marijuana Businesses Act (the “CLIMB Act”) would amend any applicable federal law to allow cannabis operators access to traditional financial institutions (e.g., national U.S. securities exchanges and commercial banks). The CLIMB Act further proposes the express federal protection of third-party providers that work with legitimate cannabis and cannabis-related businesses. Such third-party business assistance includes, but is not limited to, sale of insurance or surety products; sale, leasing, or renting of real estate; provision of legal, accounting, marketing, information technology and accounting services; and the provision of equipment, parts, substances or testing services to cannabis business operators. Cannabis companies must currently pay a premium for many of these standard business services as a result of the cannabis plant’s present status under federal law, which can result in increased operating expenses.

In September 2023, the Senate Banking Committee passed the Secure and Fair Enforcement Regulation Banking Act (the “SAFER Banking Act”) out of committee by a bipartisan vote of 14-9. While the bill, SB. 2860, was placed on the Senate legislative calendar the following day, the 118th Congress concluded without passage of the bill. Other legislation that has previously been introduced in past Congresses that would make cannabis transactions easier and more predictable include the Marijuana Opportunity Reinvestment and Expungement Act (the “MORE Act”), the Cannabis Administration and Opportunities Act (the “CAO Act”), the Preparing Regulators Effectively for a Post-Prohibition Adult-Use Regulated Environment Act (the “PREPARE Act”), the Strengthening the Tenth Amendment Through Entrusting States Act (the “STATES 2.0” Act) and the States Reform Act (the “SRA”) . Despite the rescission of the Cole Memorandum, one legislative safeguard for the medical cannabis industry remains in place. Since 2015 Congress has used a rider known as the Rohrabacher-Blumenauer Amendment (also known as the Rohrabacher–Farr amendment) (the “RBA”) to prevent the federal government from using congressionally appropriated funds to enforce federal cannabis laws against regulated medical cannabis actors operating in compliance with state and local law. However, this measure does not protect adult-use cannabis businesses. Congress has repeatedly renewed the RBA and it remains in effect today.13

The Agricultural Improvement Act of 2018 (the “2018 Farm Bill”) removed hemp from the Controlled Substances Act and legalized the growth and sale of hemp and hemp products. At the time the 2018 Farm Bill was passed, there was general consensus among the scientific community that THC, CBD, and hundreds of other cannabinoids were present in such a limited capacity that their potential for psychoactive response in users was not studied or considered. Under the protections of the 2018 Farm Bill, some manufacturers began synthesizing the abundant non-psychoactive CBD into intoxicating delta-8 THC, a molecule that only differs from its delta-9 relative by a location of a double bond between carbons. This expanded to include previously unstudied cannabinoids, such as delta-O THC, delta-10 THC, and THC-P (believed to be almost thirty-three percent more potent than delta-9 THC found in ‘traditional’ cannabis products), all of which is known as “Hemp-Synthesized Intoxicants”, or HSIs.

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In ~~January~~September of 2023, the ~~FDA,~~Senate ~~via~~Banking anCommittee ~~internal~~passed ~~working~~the ~~group~~Secure and Fair Enforcement Regulation Banking Act (the “SAFER Banking Act”) and while the bill was placed on the Senate legislative calendar, Congress concluded ~~that~~without passage of the ~~existing~~bill. ~~regulatory~~Other ~~framework~~legislation ~~for~~that ~~food~~has previously been introduced in past Congresses that would make cannabis transactions easier and ~~supplements~~more ispredictable ~~not~~include ~~appropriate~~the ~~for~~Marijuana ~~hemp~~Opportunity ~~products~~Reinvestment and ~~CBD.~~Expungement ~~The~~Act ~~Subcommittee~~(the on“MORE ~~Health~~Act”), ~~Care~~the Cannabis Administration and ~~Financial~~Opportunities ~~Services~~Act ~~released~~(the a“CAO ~~request~~Act”), the Preparing Regulators Effectively for ~~information~~a toPost-Prohibition ~~subject~~Adult-Use ~~matter~~Regulated ~~experts~~Environment ~~and~~Act ~~stakeholders~~(the ~~regarding~~“PREPARE Act”), the ~~FDA’s~~Strengthening ~~regulation~~the ofTenth ~~hemp~~Amendment ~~products~~Through Entrusting States Act (the “STATES 2.0” Act) and ~~CBD~~the States Reform Act (the “SRA”). ~~Responses~~Despite tothe rescission of the ~~request~~Cole Memorandum, one legislative safeguard for ~~information~~the ~~indicated~~medical ~~FDA~~cannabis ~~inaction~~industry remains in place. Since 2015 Congress has ~~left~~used ~~both~~a rider known as the Rohrabacher-Blumenauer Amendment (also known as the Rohrabacher–Farr amendment) (the “RBA”) to prevent the federal government from using congressionally appropriated funds to enforce federal cannabis laws against regulated medical cannabis actors operating in compliance with state and ~~hemp~~local ~~industries~~law. However, this measure does not protect adult-use cannabis businesses. Congress has repeatedly renewed the RBA and it remains in ~~limbo~~effect today. There can be no assurance that the SAFE Banking Act, the SAFER Banking Act, the CLIMB Act, the CAO Act, the MORE Act, the PREPARE Act, the STATES 2.0 Act, the States Reform Act or similar comprehensive legislation that would de-schedule and de-criminalize cannabis will be passed in the near future or at all, and there can be no assurance that the RBA will be renewed in the future. If any such legislation is passed, there is no guarantee that it will include provisions that preserve the current state-based cannabis programs under which the Company’s subsidiaries and affiliates operate or that such legislation will otherwise be favorable to the Company and its business.

AnThe ~~additional~~Agricultural ~~federal~~Improvement ~~law~~Act ~~challenge to cannabis businesses is that the provisions~~ of ~~Section~~2018 ~~280E of the Internal Revenue Code of 1986 as amended~~ (the “~~Code~~2018 Farm Bill”), ~~are~~removed ~~being~~hemp ~~applied~~from by the ~~Internal~~Controlled ~~Revenue~~Substances ~~Service~~Act ~~(the~~and ~~“IRS”)~~legalized tothe ~~businesses~~growth ~~operating~~and insale ~~the~~of ~~medical~~hemp and ~~adult~~hemp ~~use cannabis industry~~products. ~~Section~~At ~~280E~~the oftime the ~~Code~~2018 ~~prohibits~~Farm ~~cannabis~~Bill ~~businesses from deducting their ordinary and necessary business expenses~~passed, ~~forcing~~there ~~them~~was togeneral ~~pay~~consensus ~~higher~~among ~~effective~~the ~~U.S.~~scientific ~~federal~~community ~~tax~~that ~~rates~~THC, ~~than~~CBD, ~~similar~~and ~~companies~~hundreds inof other ~~industries.~~cannabinoids ~~The~~were ~~effective~~present ~~tax~~in ~~rate~~such on a ~~cannabis~~limited ~~business~~capacity ~~depends~~that ontheir ~~how~~potential ~~large~~for ~~its~~psychoactive ~~ratio~~response ofin ~~non-deductible~~users ~~expenses~~was isnot tostudied ~~its~~or ~~total revenues~~considered. ~~Therefore,~~Under ~~businesses~~the ~~participating~~protections inof the ~~state~~2018 ~~legalized~~Farm ~~cannabis~~Bill, ~~industry~~some ~~may~~manufacturers bebegan ~~less~~synthesizing ~~profitable~~the ~~than~~abundant ~~they~~non-psychoactive ~~would~~CBD ~~otherwise~~into beintoxicating ifdelta-8 ~~Section~~THC, ~~280E~~a ~~were~~molecule ~~not~~that ~~applied~~only todiffers ~~their~~from ~~businesses.~~its Ifdelta-9 ~~cannabis~~relative ~~were~~by ~~rescheduled~~a tolocation ~~Schedule~~of ~~III~~a ~~under~~double ~~the~~bond ~~CSA,~~between ascarbons. ~~recommended~~This byexpanded ~~HHS,~~to ~~Section~~include ~~280E~~previously ~~prohibitions~~unstudied ~~would~~cannabinoids, ~~no longer apply to businesses~~ such as ~~the~~delta-O ~~Company~~THC, ~~operating in the state~~delta-~~legalized~~10 ~~medical~~THC, and ~~adult~~THC-P ~~use~~(believed ~~cannabis~~to ~~industry.~~be Atalmost ~~this~~33% ~~time,~~more ~~the~~potent ~~Company~~than ~~cannot~~delta-9 ~~predict~~THC ~~the~~found ~~effect~~in ~~any~~‘traditional’ ~~potential~~cannabis ~~rescheduling would have on its taxes~~products), ~~and~~all ~~there~~of which is noknown ~~assurance~~as ~~that~~“Hemp-Synthesized ~~cannabis will become a Schedule III substance under the CSA on a given timeframe~~Intoxicants”, or ~~at all~~HSIs.

~~Violations~~In January of ~~any U.S. federal laws and regulations could result in significant fines~~2023, ~~penalties,~~the ~~administrative sanctions~~FDA, ~~convictions~~via oran ~~settlements~~internal ~~arising~~working ~~from~~group, ~~civil~~concluded ~~proceedings~~that ~~conducted by either~~ the ~~federal~~existing ~~government~~regulatory orframework ~~private~~for ~~citizens,~~food orand ~~criminal~~supplements ~~charges,~~is ~~including, but~~ not ~~limited~~appropriate ~~to,~~for ~~disgorgement~~hemp ofproducts ~~profits,~~and ~~cessation of business activities, civil forfeiture or divestiture~~CBD. ~~This~~The ~~could~~Subcommittee ~~have a material adverse effect~~ on ~~the~~Health ~~Company,~~Care ~~including our reputation~~ and ~~ability~~Financial toServices ~~conduct~~released ~~business,~~a ~~our~~request ~~cannabis~~for ~~licenses,~~information ~~the~~to ~~listing~~subject ~~and~~matter ~~trading~~experts ~~of our securities on stock exchanges~~ and ~~platforms,~~stakeholders ~~our~~regarding ~~financial position, operating results, profitability, liquidity and~~ the ~~market~~FDA’s ~~price~~regulation of ~~our~~hemp ~~publicly~~products ~~traded~~and ~~Subordinate Voting Shares~~CBD. InResponses ~~addition, it is difficult for the Company~~ to ~~estimate~~ the ~~time~~request ~~or resources that would be needed~~ for ~~the~~information ~~investigation~~indicated ofFDA ~~any~~inaction ~~such~~has ~~matters~~left orboth ~~its final resolution because, in part,~~ the ~~time~~cannabis and ~~resources~~hemp ~~that~~industries ~~may~~in ~~be needed are dependent on the nature and extent of any information requested by the applicable authorities involved, and such time and resources could be substantial~~limbo.

An additional federal law challenge to cannabis businesses is that the provisions of Section 280E of the Internal Revenue Code of 1986 as amended (the “Code”), are being applied by the Internal Revenue Service (the “IRS”) to businesses operating in the medical and adult use cannabis industry. Section 280E of the Code prohibits cannabis businesses from deducting their ordinary and necessary business expenses, forcing them to pay higher effective U.S. federal tax rates than similar companies in other industries. The effective tax rate on a cannabis business depends on how large its ratio of non-deductible expenses is to its total revenues. Therefore, businesses participating in the state legalized cannabis industry may be less profitable than they would otherwise be if Section 280E were not applied to their businesses. If cannabis were rescheduled to Schedule III under the CSA, as recommended by HHS and pursuant to the Executive Order, Section 280E prohibitions would no longer apply to businesses such as the Company operating in the state-legalized medical and adult use cannabis industry. At this time, the Company cannot predict the effect any potential rescheduling would have on its taxes, and there is no assurance that cannabis will become a Schedule III substance under the CSA on a given timeframe, or at all. We do not know what effect the Executive Order will have, if any, on the COMPETES Act, the CLIMB Act, the SAFER Banking Act, the 2018 Farm Bill, Section 280E, or other legislative acts and bills mentioned in this section.

Violations of any U.S. federal laws and regulations could result in significant fines, penalties, administrative sanctions, convictions or settlements arising from civil proceedings conducted by either the federal government or private citizens, or criminal charges, including, but not limited to, disgorgement of profits, cessation of business activities, civil forfeiture or divestiture. This could have a material adverse effect on the Company, including our reputation and ability to conduct business, our cannabis licenses, the listing and trading of our securities on stock exchanges and platforms, our financial position, operating results, profitability, liquidity and the market price of our publicly traded Common Stock. In addition, it is difficult for the Company to estimate the time or resources that would be needed for the investigation of any such matters or its final resolution because, in part, the time and resources that may be needed are dependent on the nature and extent of any information requested by the applicable authorities involved, and such time and resources could be substantial.

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Regulation of Cannabis at the U.S. State and Local Levels

Because U.S. federal law prohibits transporting any federally restricted substance across state lines, cannabis cannot be transported across state lines. This prohibition applies to, among other things, transporting cannabis between states that have legalized cannabis use and transporting cannabis that has been legally acquired in a state. Because of current federal law, the U.S. cannabis industry is regulated on a state-by-state basis, and we rely on established and developing laws and regulations in the states and local jurisdictions in which we operate. The cannabis industry is subject to state and local laws, regulations and guidelines relating to, among other matters, the cultivation, processing, distribution, sale, storage and disposal of medical and adult use cannabis, with each state enacting laws and regulations for that particular state upon approval of medical or adult use cannabis in such state. States and localities currently require licenses and permits to engage in the cannabis industry with the laws and regulations varying from state to state and locally. In many states, there are specific license caps that create high barriers to entry. In addition to stringent application requirements, licenses may be limited in scope of business. States also may enact social equity programs to foster an inclusive and equitable cannabis industry by increasing diversity in the number of license holders, which may further limit available licenses. Generally, any change in ownership of a license holder or other deemed sale, assignment or transfer of a license requires prior approval by the applicable state regulators, which approval process may be lengthy and rigorous.

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For each of our licenses, the states impose strict license renewal requirements that vary state by state. We generally must complete the renewal application process within a prescribed period prior to the expiration date and pay an application fee. The state licensing body can deny or revoke licenses and renewals for a variety of reasons, including, among others, (i) submission of materially inaccurate, incomplete or fraudulent information, (ii) failure of the Company or any of its directors or officers to comply, or have a history of non-compliance, with any applicable law or regulation, including laws relating to minimum age of customers, safety and non-diversion of cannabis or cannabis products, taxes, child support, workers compensation and insurance coverage, or failure to otherwise remain in good standing (iii) failure to submit or implement a plan of correction for any identified violation, (iv) attempting to assign registration to another entity without state approval, (v) insufficient financial resources, (vi) committing, permitting, aiding or abetting of any illegal practices in the operation of a facility, (vii) failure to cooperate or give information to relevant law enforcement related to any matter arising out of conduct at a licensed facility and (viii) lack of responsible operations, as evidenced by negligence, disorderly or unsanitary facilities or permitting a person to use a registration card belonging to another person. Some jurisdictions also require licensees to attend a public hearing or forum in connection with their initial license application and license renewal application. Any unexpected delays or costs associated with the licensing renewal process could impede our ongoing or planned operations and could have a material adverse effect on the Company’s business, financial condition, results of operations or prospects.

Below is a general summary overview of the current licensing and regulatory framework in the states where we ~~operated~~operate under cultivation, processing, transportation or retail licenses or have rights to operate under such licenses pursuant to Management Service Agreements as of ~~February~~March 2510, ~~2025~~2026. In addition to the states listed below, in the ordinary course of business we may also conduct pre-licensing activities in other markets. In these markets, we may have either received conditional licenses, applied for licenses, or plan on applying for licenses, but we do not currently own or manage businesses with operational cultivation, processing, transportation or retail licenses. See Appendix A to this Form 10-K for a list of the licenses and permits, by state, held by the Company for the cultivation, processing, wholesale distribution and retail sale of cannabis products as of ~~February~~March 2510, ~~2025~~2026.

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Arizona

Cannabis licenses in Arizona may be vertically integrated and, subject to state regulations, Arizona currently allows access to cannabis for both medical and adult use. Cannabis establishment licensees may operate all of the following: (i) a single retail location at which the licensee may sell cannabis and cannabis products to consumers, cultivate cannabis and manufacture cannabis products; (ii) a single off-site cultivation location at which the licensee may cultivate cannabis, process cannabis and manufacture cannabis products, but from which cannabis and cannabis products may not be transferred or sold to consumers; and (iii) a single off-site location at which the licensee may manufacture cannabis products and package and store cannabis and cannabis products, but from which cannabis and cannabis products may not be transferred or sold to consumer.

Arizona state licenses are renewed biennially. Every other year, licensees are required to submit a renewal application. While renewals are biennial, there is no ultimate expiry after which no renewals are permitted. Additionally, in respect of the renewal process, provided that the requisite renewal fees are paid, the renewal application is submitted at least thirty days prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Arizona.

Connecticut

Subject to state regulations, Connecticut allowed access to cannabis for medical use beginning in 2012. In July 2021, legislation went into effect allowing for the purchase and use of cannabis by any adult over the age of 21. Adult retail sales began in January 2023. Connecticut regulations apply to all aspects of cannabis seed-to-sale including record keeping, reporting, inventory quality, inventory tracking, storage, security and transportation.

Connecticut state licenses are renewed annually. Each year, licensees are required to submit a renewal application. While renewals are annual, there is no ultimate expiry after which no renewals are permitted. Additionally, in respect of the renewal process, provided that the requisite renewal fees are paid, the renewal application is submitted at least forty-five days prior to license expiration, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Connecticut.

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Florida

Subject to state regulations, Florida currently allows access to cannabis for medical use. The Florida operation includes a call center for all state operations.

Florida state licenses are renewed biennially. Every other year, licensees are required to submit a renewal application. While renewals are biennial, there is no ultimate expiry after which no renewals are permitted. Additionally, in respect of the renewal process, provided that the requisite renewal fees are paid, the renewal application is submitted at least ninety days prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

The Florida Marijuana Legalization Initiative (“Initiative #22-05”) appeared on the ballot in Florida as an initiated constitutional amendment on November 5, 2024. If adopted, Initiative #22-05 would have authorized the legalization of cannabis for adults twenty-one years old and older and allowed individuals to possess up to three ounces of cannabis, with up to five grams in the form of concentrate. Existing medical cannabis treatment centers would have been authorized under the initiative to acquire, cultivate, process, manufacture, sell, and distribute cannabis products and accessories. The amendment achieved majority, 56%, support among voters in Florida but failed to reach the supermajority 60% required for adoption. A revised constitutional amendment, drafted to address a number of concerns raised by opponents of Initiative #22-05, has been submitted to the Florida Secretary of State for consideration during the 2026 election. This ballot initiative remains subject to possible legal challenges. There is no assurance that this initiative will appear on the ballot in Florida or that Florida voters will support this initiative.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Florida.

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Illinois

Subject to state regulations, Illinois currently allows access to cannabis for both medical and adult use. Illinois has issued a limited amount of dispensary, cultivation, and processing licenses. Applicants for cannabis business licenses must meet, among others, the following requirements: (i) the location for a dispensary must be suitable for public access; (ii) the location must not pose a detrimental impact to the surrounding community; (iii) demonstrate compliance with safety procedures for dispensary employees, patients, and caregivers, and safe delivery and storage of cannabis and currency; (iv) provide an adequate plan for recordkeeping, tracking and monitoring inventory, quality control, destruction and disposal of cannabis, and procedures to discourage unlawful activity; (v) develop a business plan specifying products to be sold; and (vi) demonstrate knowledge of, experience, and proven record of ensuring optimal safety and accuracy in the dispensing and sale of cannabis.

Once a license is granted, licensees have a continuing obligation to ensure no cannabis is sold, delivered, transported, or distributed to a location outside of Illinois. Licenses are valid for one year, and after the initial term, licensees are required to submit renewal applications. Illinois requires on-going compliance by license holders to regulations regarding the requirements of the application, which include suitable locations, safety procedures, procedures for compliance with laws, record keeping, reporting, storage, inventory quality, inventory tracking, security and transportation. In respect of the renewal process, provided that the requisite renewal fees are paid, the renewal application is timely submitted prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

Following an approximate three-year delay in Illinois’s 2020 licensing application process, new adult use dispensary, infuser, craft grower, and transporter licenses have began to operationalize. The Company established strong relationships with Illinois customers and the communities in which it operates, and will work with new licensees to build profitable new business relationships. While the operationalization of new cannabis business licenses does increase the level of retail competition within this state market, it also presents additional wholesale opportunities for the Company’s cultivation and manufacturing operation in this state market.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Illinois.

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Maryland

Subject to state regulations, Maryland currently allows access to cannabis for both medical and adult use. The principal license categories in Maryland are: (i) standard grower; (ii) standard processor; (iii) standard dispensary; (iv) micro grower; (v) micro processor; (vi) micro dispensary; (vii) incubator space; and (viii) on-site consumption establishment. Maryland has limited the number of each license, and allows a dispensary licensee to have a direct interest in up to four dispensaries at one time. The standard dispensary license permits the licensee to purchase cannabis from cultivation facilities, cannabis and cannabis products from product manufacturing facilities and cannabis from other retail stores and allows the sale of cannabis and cannabis products to registered patients. The standard grower license permits the licensee to acquire, possess, cultivate, deliver, transfer, have tested, transport, supply or sell cannabis and related supplies to cannabis dispensaries, and cannabis cultivation facilities. The standard processing license permits the licensee to purchase cannabis from cultivation facilities, manufacture cannabis products, and sell those products to licensed cannabis dispensaries. Maryland licenses are valid for a period of five years and are subject to renewals after required fees are paid and provided that the business remains in good standing.

Maryland requires on going compliance with laws and regulations regarding record keeping, reporting, storage, inventory quality, inventory tracking, security and transportation. The license holder must ensure that no cannabis may be sold, delivered, transported or distributed by a producer from or to a location outside of the State. Registration renewal applications may be denied if the licensee has a history of non-compliance and penalties.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Maryland.

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Massachusetts

Subject to state regulations, Massachusetts currently allows access to cannabis for both medical and adult use. On the medical side, there is one principal state license category in Massachusetts: a vertically-integrated license. On the adult use side, there are many state license categories, but the two principal ones are cultivator and establishment (i.e., dispensary). Municipalities may individually determine what local permits or licenses are required if a licensee wishes to establish an operation within its boundaries. Medical use licensees are “vertically-integrated,” meaning they grow, process, and dispense their own cannabis. As such, each medical use licensee is required to have a retail facility as well as cultivation and processing operations. Under certain conditions, medical use licensees can acquire up to 45% of their annual inventory of product from other medical use licensees. Medical use licensees that elect to conduct cultivation, processing and retail operations in one location, are commonly referred to as a “co-located” operation.

Massachusetts mandates a comprehensive application process for licensees. Each applicant must submit charter documents, comprehensive financial statements, a character competency assessment, and employment and education histories of the senior partners and individuals responsible for the day-to-day security and operations. Each Massachusetts dispensary, grower, and processor license is valid for one year.

Licensees are heavily regulated with on-going requirements related to operations, security, storage, transportation, inventorying, personnel, and more. As in other states where cannabis is legal, Massachusetts regulators can deny or revoke licenses and renewals for multiple reasons. Additionally, license holders must ensure that no cannabis is sold, delivered, or distributed by a producer from or to a location outside of Massachusetts. Provided that the requisite renewal fees are paid, the renewal application is submitted at least ninety days prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Massachusetts.

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Michigan

Subject to state regulations, Michigan currently allows access to cannabis for both medical and adult use. Michigan administers five types of licenses: (i) grower licenses; (ii) processor licenses; (iii) secure transporter licenses; (iv) provisioning center licenses; and (v) safety compliance facility licenses. There are no stated limits on the number of licenses that can be made available on a state level; however, regulatory authorities have discretion over the approval of applications and municipalities can pass additional restrictions.

Licensees are heavily regulated with on going requirements related to operations, security, storage, transportation, inventorying, personnel, and more. As in other states where cannabis is legal, Michigan regulators can deny or revoke licenses and renewals for multiple reasons. Additionally, license holders must ensure that no cannabis is sold, delivered, or distributed by a producer from or to a location outside of Michigan.

Michigan state licenses are renewed annually. Every year, licensees are required to submit a renewal application with requisite renewal fees, including maintaining and providing proof of commercial general liability insurance and coverage for bodily injury resulting from sale of cannabis products. Provided that the requisite renewal fees are paid, the renewal application is timely submitted prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Michigan.

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Nevada

Subject to state regulations, Nevada currently allows access to cannabis for both medical and adult use. Nevada is not a vertically integrated system, and there are three principal license categories in Nevada: (i) cultivation; (ii) processing; and (iii) dispensary. The cultivation licenses permit the licensee to acquire, cultivate, deliver, supply and/or sell cannabis and related supplies to cannabis dispensaries and facilities for the production of edible cannabis products and cannabis -infused products. The processing license permits the licensee to acquire, manufacture, deliver, supply and/or sell edible cannabis products or cannabis-infused products to other cannabis production facilities or cannabis dispensaries. The dispensary licenses permit the licensee to purchase cannabis from cultivation facilities, cannabis and cannabis products from product manufacturing facilities, and cannabis from other retail stores, as well as allow the sale of cannabis and cannabis products to lawful consumers.

Nevada licenses are valid for one year and are subject to annual renewals after required fees are paid and provided that the business remains in good standing. Nevada requires on going compliance with laws and regulations regarding record keeping, reporting, storage, inventory quality, inventory tracking, security and transportation. Provided that the requisite renewal fees are paid, the renewal application is timely submitted prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Nevada.

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New Jersey

Subject to state regulations, New Jersey currently allows access to cannabis for medical use and adult use. New Jersey permits the operation of vertically integrated cannabis licenses, named Alternate Treatment Centers (“ATCs”) which allow the licensee to cultivate, process, and sell medical cannabis products to registered qualified patients and caregivers. There are also non-vertically integrated licenses, which principally include: (i) cultivators and manufacturers, which may cultivate cannabis and manufacture medical cannabis products; and (ii) dispensaries which may sell medical cannabis and products to registered qualified patients and caregivers. For adult use cannabis, New Jersey administers six license classes, the principal of which are: (i) cultivator, which may grow recreational use cannabis; (ii) manufacturers, which may produce recreational use cannabis in additional approved forms; and (iii) retailer, which may sell recreational cannabis to consumers over the age of 21. ATCs may expand into adult use sales if approved by New Jersey’s Cannabis Regulatory Commission.

Licensees are heavily regulated with on going requirements related to operations, security, storage, transportation, inventory, personnel, and more. New Jersey licenses are valid for one year and are subject to annual renewals. As in other states where cannabis is legal, New Jersey regulators can deny or revoke licenses and renewals for multiple reasons. Additionally, license holders must ensure that no cannabis is sold, delivered, or distributed by a producer from or to a location outside of New Jersey. Provided that the requisite renewal fees are paid, the renewal application is submitted at least ninety days prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in New Jersey.

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Ohio

Subject to state regulations, Ohio currently allows access to cannabis for medical and adult use. There are three principal license categories in Ohio: (i) dual use cultivator; (ii) dual use processor; and (iii) dual use dispensary. On at least a biennial basis, state regulators consider whether enough medical cannabis dispensaries exist, considering the state population, the number of patients seeking to use medical cannabis and the geographic distribution of dispensary sites. More licenses may be issued based on those findings. The dual use cultivation licenses permit the licensee to acquire, possess, cultivate, manufacture, and process medical and adult use cannabis products, deliver, transfer, have tested, transport, supply and/or sell cannabis and related supplies to dispensaries. The dual use processor license permits the licensee to manufacture and produce medical and adult use cannabis products. The dual use dispensary license permits the licensee to purchase cannabis and cannabis products from cultivation and processing facilities, as well as allow the sale of cannabis and cannabis products to registered patients and lawful consumers.

Ohio requires on going compliance with laws and regulations regarding record keeping, reporting, storage, inventory, product quality, inventory tracking, security, and transportation. The license holder must ensure that no cannabis may be sold, delivered, transported, or distributed by a producer from or to a location outside of the State. Registration renewal applications may be denied if the licensee has a history of non-compliance and penalties. Ohio cultivation, processing, and dispensary licenses are valid for one year and subject to annual renewal. Provided that the requisite renewal fees are paid, the renewal application is submitted at least ~~thirty~~30 days for cultivation and/or manufacturing (or forty-five days for dispensaries), prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

On November 7, 2023, ballot initiative Ohio Issue 2, the Marijuana Legislative Initiative, was approved by 57% of Ohio voters as an indirect initiated state statute. In addition to authorizing adult use in Ohio, the ballot initiative authorizes adult-use consumers to possess up to 2.5 ounces of cannabis (up to fifteen grams of cannabis concentrates) and to purchase plant material, seeds, live plants, and clones. The initiative further established the Division of Cannabis Control within the Ohio Department of Commerce. Under the initiative, additional adult-use licenses may be allocated beginning two years from the issuance of initial adult-use licenses based on certain market factors.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Ohio.

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Pennsylvania

Subject to state regulations, Pennsylvania currently allows access to cannabis for medical use. The principal permit categories in Pennsylvania are: (i) cultivation; (ii) processing; and (iii) dispensary. The cultivation and processing permits allow the holder to acquire, possess, cultivate, manufacture and/or process medical cannabis products and medical cannabis-infused products, and deliver, transfer, have tested, transport, supply or sell cannabis and related supplies to medical cannabis dispensaries. The retail dispensary permits allow the holder to purchase cannabis and cannabis products from cultivation and processing facilities, as well as allow the sale of cannabis and cannabis products to registered patients and caretakers.

Pennsylvania state licenses are renewed annually, and licensees are required to submit a renewal application every year. There is no ultimate expiry after which no renewals are permitted. In respect of the renewal process, the renewal application must be submitted within six months, but no later than four months of the license’s expiration and requires detailed information regarding the licensee’s operations.

Permit holders are heavily regulated with on-going requirements related to operations, security, storage, transportation, inventorying, personnel, and more. As in other states where cannabis is legal, Pennsylvania regulators can deny or revoke permits and renewals for multiple reasons. Additionally, permit holders must ensure that no cannabis is sold, delivered, or distributed by a producer from or to a location outside of Pennsylvania.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Pennsylvania.

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Virginia

Subject to state regulations, Virginia currently allows access to cannabis for medical use. Virginia’s Cannabis Control Authority administers two permit types: (i) pharmaceutical processor, which grows and processes medical cannabis; and (ii) dispensaries, which dispense medical cannabis and medical cannabis products to patients and caregivers. Each year, licensees are required to submit a renewal application. While renewals are annual, there is no ultimate expiry after which no renewals are permitted. Additionally, in respect of the renewal process, provided that the requisite renewal fees are paid, the renewal application is submitted prior to the expiration date, and there are no material violations noted against the applicable licenses, a licensee would expect to receive the applicable renewed license in the ordinary course of business.

In January 2025, Senator Aaron Rouse of Virginia Beach introduce Senate Bill 970 which would authorize adult use of cannabis in Virginia. In 2024, similar legislation was vetoed by Governor Glenn Youngkin.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in Virginia.

West Virginia

Subject to state regulations, West Virginia currently allows access to cannabis for medical use. West Virginia’s Office of Medical Cannabis administers three permit types: (i) growers, which grow and cultivate medical cannabis, (ii) processors, which manufacture medical cannabis into approved forms other than usable medical cannabis, and (iii) dispensaries, which dispense medical cannabis and medical cannabis products to patients and caregivers. Licenses must be annually renewed.

West Virginia requires on-going compliance with laws and regulations regarding record keeping, reporting, storage, inventory, product quality, inventory tracking, security and transportation. The license holder must ensure that no cannabis may be sold, delivered, transported or distributed by a permittee from or to a location outside of the State. Registration renewal applications may be denied if the licensee has a history of non-compliance and penalties.

West Virginia licenses are valid for one year and subject to annual renewal. In respect of the renewal process, the renewal application must be submitted within six months, but no later than four months of the license’s expiration and requires detailed information regarding the licensee’s operations.

See Appendix A to this Form 10-K for a list of the licenses issued to us with respect to our operations in West Virginia.

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Conclusion

It is impossible to determine the extent of the impact of new federal and state and local laws, regulations or initiatives that may be proposed. The regulatory uncertainty surrounding the cannabis industry may adversely affect our business and operations, including without limitation by increasing costs to remain compliant with applicable laws, the impairment of our business by enhanced restrictions and restrictions on our ability to raise additional capital.

We will continue to monitor proposed changes to existing cannabis laws and regulations, the enactment of new cannabis laws and regulations and our compliance with applicable existing cannabis laws and regulations on an ongoing basis in accordance with our compliance program and standard operating procedures. While we believe our operations are in compliance with all applicable state and local laws, regulations and licensing requirements, such activities remain illegal under federal law. For the reasons described above and the risks further described in the section entitled “Risk Factors,” there are significant risks associated with our business. Readers of this Form 10-K are strongly encouraged to carefully read all of the risk factors contained in Item 1A—“Risk Factors.”

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State and Local Licenses and Permits

The Company, through our subsidiaries and affiliates, holds ~~all~~ licenses and permits that are necessary to comply with state and local cannabis medical and adult use laws and regulations applicable to our operations. All such permits and licenses are current and in effect. We are dependent upon the maintenance and renewal of our cannabis licenses and permits in the states and localities in which our business is operated. Maintenance and renewal of these licenses and permits requires us to remain in compliance with state and local laws and the rules and regulations promulgated by state and local jurisdictions.

See Appendix A to this Form 10-K for a list of the licenses and permits, by state, held by the Company for the cultivation, processing, wholesale distribution and retail sale of cannabis products as of ~~February~~March 2510, ~~2025~~2026.

State and local laws and associated rules and regulations may change in the future, and we may be required to obtain additional or supplemental licenses or permits at such times. Our growth strategy includes the acquisition of additional state licensed businesses or assets that may require us to obtain prior state regulatory approval to a change of ownership of the license holder or to a deemed transfer, assignment or sale of the applicable license, which regulatory approval may be conditioned on stringent requirements, in particular if such businesses or assets reside in states or local jurisdictions where we do not currently have operations. See “Item 1A. Risk Factors — Risks Related to our Business and Operations — The Cannabis Industry”.

Regulatory Compliance Program

Our regulatory and compliance group oversees, maintains, and implements our regulatory compliance program. The compliance group also prepares, submits and processes our applications for new licenses, renewals, approvals for changes to our existing licenses and approvals for change of ownership of licensees or ~~deemed~~ sales, transfers or assignments of licenses that arise with acquisitions and dispositions. In addition to our internal regulatory and compliance group and legal group, we have engaged outside legal counsel, consultants and advisors in many jurisdictions.

The Company’s regulatory and compliance group oversees training for cultivation, production and dispensary managers and employees, along with other department leaders and other persons, as needed, in maintaining compliance with all state and local laws and regulations. The regulatory and compliance group also monitors all new, proposed, and/or amended laws and regulations and compliance notifications from state and local regulators and inspectors, and ~~the compliance group~~ leads in ~~timely~~ resolving any identified issues or concerns.

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Our compliance program includes the following ~~compliance~~ objectives.

•Ensure the operations of our subsidiaries ~~(or~~and ~~third~~operations ~~parties,~~subject ~~in jurisdictions where we have agreements that provide contractual rights with respect~~ to ownership, management services, consulting or licensing, or a combination thereof, with respect to the applicable license and related cannabis business being conducted pursuant thereto (each such agreement, a “Management Services Agreement~~”))~~ are compliant with ~~all~~ licensing requirements by the applicable state, county, municipality, town, township, borough, and other administrative entities.

•Ensure our business activities adhere to the scope of the licensing obtained. In the states where only medical cannabis is permitted, the cannabis products are only sold to patients who hold the necessary documentation to permit the possession of the cannabis being sold, and in the states where cannabis is permitted for adult use, the cannabis products are only sold to individuals who meet the requisite age and respective state identification requirements. ~~We carefully align with regulations in jurisdictions allowing both medical and adult use cannabis to ensure compliance with each program.~~

•Perform due diligence on cannabis businesses we may acquire, ~~including~~or ~~on the policies and procedures in place to ensure~~ that ~~cannabis products~~ are ~~not~~subject ~~distributed~~ to ~~minors~~Management ~~and~~Services ~~review~~Agreements, ~~the~~including ~~ownership~~confirming ~~to ensure~~ that ~~no profits or revenues are used for~~ the ~~benefit~~businesses ofhave ~~criminal enterprises and that the business has~~ not been involved in violations of law.

•Ensure our businesses adhere to our policies, procedures and practice standards with sufficient checks and balances to confirm that no revenue is distributed to criminal enterprises.

•Review inventory tracking systems and procedures to ensure that the compliance system is effective at tracking inventory and ~~ensuring~~confirming that there is no diversion of cannabis or cannabis products within the state, in addition to ensuring that no cannabis or cannabis products are diverted into the states where cannabis is not permitted by state law or cross state lines in general.

•Review financial records to ensure that our business activity is not used as a cover or pre-text for trafficking of illegal drugs or engaged in any other illegal activity or any activities that are contrary to any applicable anti-money laundering statutes.

•Conduct background checks to ensure that our directors, officers, and management are of good character, and have not been involved with illegal drugs, engaged in illegal activity or activities involving violence, or use of firearms in the cultivation, manufacturing or distribution of cannabis.

•Review activities of each of our subsidiary and affiliate businesses, the premises on which our subsidiaries and affiliates operate and adherence with the policies and procedures that are related to the possession of cannabis or cannabis products outside of licensed premises, including that there is no possession or use of cannabis on federal property or manufacturing or cultivation of cannabis on federal lands.

•Conduct reviews of products and product packaging to ensure that the products and packaging comply with applicable regulations and contain necessary disclaimers about the contents of the products to prevent adverse public health consequences from cannabis use and prevent violations related to motor vehicle, labor and other laws applicable to individuals.

We have comprehensive standard operating procedures that apply to seed-to-sale inventory control across all our locations that include, among others, procedures for receiving inventory, inventory tracking, testing, quality control, storage, record keeping, record retention, required reporting, and security and transportation, as well as procedures for performing inventory reconciliation and ensuring the accuracy of recordkeeping. Regular audits of cannabis and cannabis products inventories are conducted to detect any possible diversion. In addition, security and compliance staff conduct unscheduled and unannounced audits to prevent complacency or the perception thereof. Adherence to the Company’s standard operating procedures is mandatory to ensure that our operations are compliant with the rules set forth by the applicable state and local laws, regulations, ordinances, licenses and other requirements.

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Products

We derive our revenues from our wholesale business and our retail dispensary chains. The retail business includes the design, development and operation of branded dispensaries in both medical and adult use markets. Our primary retail presence is traditional brick-and-mortar. However, as regulations allow, we expect to continue to expand our e-commerce, and in-store guest pick-up ~~and direct-to-consumer delivery capabilities~~ as part of our commitment to providing a consistent retail brand experience no matter where the consumer might be.

We distribute our portfolio of products to cannabis retail stores in our active markets, including our own retail stores. Ownership of both wholesale and retail operations supports our strategy of distributing our brands at scale by enabling the Company to capture market share, generate brand awareness, and earn customer loyalty in our operating markets through our managed dispensaries and through third-party wholesale customers.

We manufacture and sell a comprehensive array of cannabis products that we design and develop with consumer segments in mind in both the medical and adult use markets. We estimate our products include a proprietary portfolio of over 1,000 product stock-keeping units (“SKUs”), and include flower, concentrates for dabbing and vaporizing, edibles, and topicals. Our consumer brands include Encore™, Avexia™, MÜV™, Savvy™, (the) Essence™, BITS™, HYPHEN™, Swift Lifts™ and Verano™. Our retail dispensaries operate under brands including Zen Leaf™ and MÜV™. AsWe ~~of February 25, 2025, we~~ also have several dispensaries operating under the Cannabist or SWC brand name following our acquisitions of Cannabist AZ and CC East Virginia.

We utilize seed-to-sale tracking software to inventory products, assess quality and minimize product discrepancies and deviated inventory.

Operational Foundation &and Current Geographic Markets

We are engaged in the cultivation, processing and distribution of cannabis products with both wholesale and retail business operations. Processing is done on-site inat ~~kitchens~~our cultivation and ~~processing~~production facilities in kitchens and ~~distribution~~laboratories, and is then distributed to dispensaries. Distribution of products only occurs at these facilities. We do not own or lease any warehouses to store cannabis.

Our current active operations are located in the following 13 states: Arizona, Connecticut, Florida, Illinois, Maryland, Massachusetts, Michigan, Nevada, New Jersey, Ohio, Pennsylvania, Virginia and West Virginia. Our active operations include cultivation, processing, wholesale distribution and retail. All of these markets are subject to state regulations that vary by state, and many of these regulations have, from time to time, been enacted, modified and amended. In addition, municipalities may individually determine what local permits or licenses are required to operate within their boundaries. We actively monitor state and local developments in laws and regulations which may impact our business interests and operations. See “—Regulatory Framework in the United States— Regulation of Cannabis at the U.S. State and Local Levels” above for additional information.

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NATIONAL FOOTPRINT

Our business plan includes the continued growth of our wholesale and retail operations by entering new markets and expanding in our current markets, including when medical markets expand into adult use markets. Growth plans include applying for new licenses, acquiring existing licensed businesses in limited license markets and maximizing operations under our existing licenses.

Research and Development

Our research and development activities have primarily focused on the development and improvement of efficient and sustainable cannabis cultivation and manufacturing methodologies and technologies to increase yields and maintain and improve the quality of our products. This includes research on lighting methods, air controls, racking and stacking, growing media, nutrient mixtures, pest management techniques, ambient controls, and automation.

We also engage in research and development activities focused on creating new extracted or infused products, and breeds of new cannabis strains and varietals. Our product development team includes members from all relevant product disciplines, who actively monitor existing and prospective markets, as well as test and evaluate the financial viability of all new proposed products.

Intellectual Property

We believe that intellectual property rights and brand protection are important parts of our business strategy. We regularly seek to protect our intellectual property rights in connection with our operating names, our consumer-packaged goods, and certain proprietary goods and services. Such rights include patented and non-patented technology, trade secrets, ~~copyrightable works,~~ and state and federal trademarks. The U.S. federal trademark statute, The Lanham Act, allows for the protection of trademarks and service marks on products and services used, or intended for use, lawfully. Because cannabis-related products and services remain illegal at the U.S. federal level under the Controlled Substances Act, we are not able to register all our trademarks at the U.S. federal level for all products and services; therefore, we currently utilize trademark protection at the state level where commercially feasible. We have also sought protection of our trademarks internationally in countries where we may use the marks or license the right to use the marks. Nonetheless, our success depends upon other areas of our business such as brand awareness, product development and design, production and marketing and not exclusively upon trademarks, patents and trade secrets.

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The Company, through our subsidiaries and affiliates, has a ~~growing~~ portfolio of approximately ~~145~~130 active trademarks registered or pending registration with the U.S. Patent and Trademark Office or other state entities and approximately 70100 active trademarks registered or pending registration with non-U.S. governmental entities, including trademarks with respect to products and retail branding. Product trademarks include various brands such as: Encore™, Avexia™, MÜV™, Savvy™, (the) Essence™, BITS™, HYPHEN™, Swift Lifts™ and Verano™, and dispensary brands Zen Leaf™ and MÜV™. We anticipate feedback on outstanding submitted applications on a rolling basis and will continue to rely on common law protection for our brands during the trademark registration process. We plan to renew our trademarks on an ongoing basis, and we plan to proactively seek intellectual property protection for products, services, and brand expansions in current markets as well as any new market expansion.

~~From~~Since ~~the time~~ we became licensed to cultivate cannabis, we have developed proprietary ~~cultivation~~manufacturing techniques for operating ethanol, butane, and carbon dioxide extraction ~~machinery~~equipment, including what we believe are best-in-class production practices, operating procedures, and methods. This requires specialized skills in cultivation, extraction and refining. ~~Four~~Five U.S. and ~~fourteen~~seventeen foreign patents and patent applications are held by our subsidiaries and affiliates for cannabinoid formulations related to transdermal and oral delivery. For additional details, see “Item 1A. Risk Factors — Risks Related to Our Business and Operations — Information Technology, Cybersecurity and Intellectual Property.”

We have several website domains, including www.verano.com, numerous social media accounts across all major platforms, and various phone and web application platforms. We rely on contractual protection, including non-disclosure and confidentiality agreements to protect our intellectual property rights, including trade secrets. To the extent the Company describes or discloses its proprietary cultivation or extraction techniques in its applications for cultivation or processing licenses, the Company’s policy is to redact or request redactions of such information prior to public disclosure. For additional details on the risks associated with the Company’s intellectual property, see “Item 1A. Risk Factors — Risks Related to Our Business and Operations — Information Technology, Cybersecurity and Intellectual Property.”

Competitive Conditions

The fast-growing market for legalized cannabis in the U.S. has created a competitive environment for cannabis producers as well as other types of companies who provide goods and services to the cannabis industry. We compete with a variety of different operators across the states in which we currently operate. In many of these states, there are specific license caps that create high barriers to entry. Management of the Company views multi-state operators that have vertical operations as our most direct competition, including the following U.S. based public reporting companies: Green Thumb Industries Inc., Cresco Labs, Inc., Curaleaf Holdings, Inc., and Trulieve Cannabis Corp.

Aside from existing direct competition in states in which we currently operate, out-of-state operators that are capitalized well enough to enter state markets ~~through acquisitions~~ are also considered part of the competitive landscape. Similarly, as we pursue our national footprint growth strategy, operators in our target markets will inevitably become direct competitors. Additionally, we, along with all legally operating competitors, face competition from the illicit markets, including from psychoactive hemp-based products. See “Item 1A. Risk Factors — Risks Related to our Business and Operations — The Cannabis Industry.” However, as federal, state and local regulators increase scrutiny on these illicit markets, ~~management of~~ the Company believes this competitive threat will be ~~meaningfully~~ reduced.

There remains a significant lack of traditional sources of bank lending and equity capital available to fund the operations of companies in the cannabis sector. Financing for companies in the cannabis sector is more difficult than other sectors, particularly in the U.S., due to cannabis’s classification as a Schedule I drug under the Controlled Substance Act and federal illegality, which create barriers to entry. Additionally, the dynamics of the changing regulatory environment at the state level further complicate financing for companies in the cannabis sector. Competitors, particularly those that sell hemp products which are currently legal in the U.S., may have better access than we do to financing sources and the capital markets. The Executive Order, and any rescheduling as a result of the Executive Order, may change the availability of bank lending and equity capital to companies in the cannabis sector, but we cannot yet predict how this may change or if it will change at all.

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Marketing and Sales

As of ~~February~~March 2510, ~~2025~~2026, through our subsidiaries and affiliates we operate businesses in 13 states, including ~~153~~160 retail dispensaries and 1514 cultivation and processing facilities with over 1.1 million square feet of cultivation capacity. Our sales revenue is derived from our wholesale business and our national chain of retail dispensaries operating under our brands, including Zen Leaf™ and MÜV™.

For the fiscal year ended December 31, ~~2024~~2025, approximately 3432.51% of our consolidated revenue, net of discounts, were generated by our wholesale operations and approximately 6567.59% of our consolidated revenue, net of discounts were generated by our retail dispensary operations, in each case, excluding intersegment eliminations. For the fiscal year ended December 31, ~~2024~~2025, medical-use sales and adult use sales contributed approximately 5153% and 4947% of our consolidated revenues, respectively.

For the fiscal year ended December 31, ~~2024~~2025, approximately 1714% and 1611% of our consolidated sales were generated in Illinois and New Jersey, respectively, where 6979% and 9091% of sales were in adult use products in each market, respectively. For the fiscal year ended December 31, ~~2024~~2025, approximately 2228% of our consolidated sales were generated by our Florida operations, where all sales are for medical products and are generated solely by our retail stores given the vertical integration requirements of Florida’s cannabis regulations. Verano is not dependent upon any single customer, or a few customers, noting that a customer is a single retail customer or an individual dispensary customer,. ~~would~~No ~~not~~loss of any single customer would have a material adverse effect on our business or financial results.

~~Some~~The ~~of the~~ states in which we operate have regulations that restrict marketing and sales activities of cannabis products. Restrictions may specify what, where and to whom cannabis product information and descriptions may appear or be advertised. Marketing, advertising, packaging and labeling regulations for cannabis products also vary from state to state, potentially limiting the consistency and scale of consumer branding communications and product education efforts. We strive to deploy a diverse range of marketing and brand recognition strategies that comply with applicable local and state laws and regulations.

In medical cannabis markets we seek to educate patients and potential patients about our products and medical dispensaries through certifying physicians, community outreach events and on-going staff training and education. For adult use markets, we seek to educate customers and potential customers about our products and retail dispensaries through community outreach events, ~~compliant~~ advertising and on-going staff training and education, in each case, where allowed under applicable regulations. In Florida we operate a patient care call center with staff that provide support via direct phone, email and online chat customer service communication for customers ~~spanning~~across ~~a majority of~~ our multi-state footprint.

Market data for more established medical markets expanding into adult use of cannabis are generally more reliable than market data for medical cannabis in states launching their medical initial programs. We rely largely on our own market research to forecast sales based upon historical sales, demographics, regulatory changes, demand, competition and similar consumer driven research. Using market data for medical and adult use cannabis can be difficult due to ongoing regulatory changes, limited information given the age of the industry and unreliable market information on supply levels. See “Item 1A. Risk Factors — Our sales volumes are difficult to forecast and a failure in the expected demand for our products to materialize could have a material adverse effect on our business, financial condition and results of operations” for more information.

Cultivation and Production

The cultivation and production of cannabis products requires licensing and permitting by each state where operations are conducted. As of ~~February~~March 2510, ~~2025~~2026, we actively operate 1514 cultivation and production facilities with over 1.1 million square feet of cultivation capacity. ~~Seven~~Nine of these production facilities are Current Good Manufacturing Practices certified.

We only use state-permitted products in our cultivation sites to meet testing, inventory, and other applicable state regulatory requirements. We have implemented ~~and are adhering to~~ standard operating procedures across all of our production facilities.

Although cannabis is an agricultural product, our cultivation methodologies employ a perpetual harvest system whereby plants are propagated and harvested on a staggered schedule. This ensures limited variability in the availability of finished products and minimizes the otherwise cyclical or seasonal nature of the plant-based business.

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Components

The principal components in the production of our consumer packaged products include cannabis grown internally or acquired through wholesale channels, as well as other agricultural products, and packaging materials (including glass, plastic and cardboard) acquired through wholesale channels. Almost all raw material inputs, except packaging materials, used to produce our cannabis consumer packaged goods are cultivated or processed internally for further use in the manufacturing process. Due to the U.S. federal prohibition on cannabis, we must source cannabis within each state in which we operate.

Seasonality

Our business operates year-round; however, operations and sales trends in certain markets are subject to seasonal fluctuations. In particular, the Company’s retail dispensaries in Florida and Arizona have historically experienced increased customer traffic and higher sales volumes during the winter months due to the influx of seasonal residents and tourists. We also experience increases in sales from promotional activity around specific industry and holiday events, including 4/20, 7/10, and Green Wednesday (the Wednesday before Thanksgiving).

Environmental

~~Similar~~Cannabis tocultivation ~~traditional~~is ~~agricultural practices~~energy-intensive, ~~the~~particularly ~~cultivation~~when ~~and~~grown ~~processing~~indoors. ofEnergy ~~cannabis~~is ~~can~~essential ~~impact~~for ~~the environment through waste~~lighting, ~~energy~~environmental ~~use~~controls, ~~air pollutants, agriculture water runoff,~~ and ~~soil~~hydration ~~degradation. The~~at ~~extent~~indoor ~~of these environmental impacts is contingent on the methods of~~ cultivation ~~and production employed~~operations. ~~The~~Access ~~cannabis~~to ~~industry~~energy isinfrastructure, insuch ~~its~~as ~~early~~power ~~stages~~grids, ~~and~~can aspose itchallenges, ~~continues~~leading to ~~mature~~temporary ~~and~~reliance ~~expand~~on ~~with~~generators ~~increasing~~powered ~~legalization,~~by wefossil ~~believe~~fuels ~~the~~that ~~industry~~can ~~will~~impact ~~develop~~air ~~comprehensive~~quality. ~~environmental~~Despite ~~sustainability~~these ~~practices~~challenges, inindoor ~~accordance~~cultivation ~~with~~remains ~~emerging~~our ~~state~~primary ~~regulatory~~method ~~requirements.~~of ~~The~~cultivating ~~establishment~~cannabis, ofdriven ~~cooperative~~by ~~policies~~market ~~and~~demand ~~standards~~for ~~across local~~consistent, ~~state,~~high-quality ~~regional,~~cannabis ~~and~~products ~~national~~year-round, ~~levels~~independent ~~for~~of ~~both~~adverse ~~cannabis~~weather and ~~hemp~~fluctuating ~~markets~~daylight. ~~will~~Currently, beall ~~pivotal~~of tothe ~~advancing~~Company’s ~~environmental~~cultivation ~~sustainability~~is ~~across~~done ~~the~~indoors, ~~cannabis~~including ~~industry~~in enclosed greenhouse facilities.

~~Organic~~Historically, ~~plant~~expenditures ~~waste~~for ~~and~~compliance ~~single-use~~with ~~consumer~~environmental ~~packaging~~laws ~~constitute~~and aregulations ~~significant~~have ~~portion~~not ofbeen ~~the~~material ~~waste~~to ~~generated from~~ the ~~industrial-scale~~Company’s ~~cultivation~~financial ~~and processing of cannabis~~results. In ~~several states~~addition, ~~regulations~~we ~~mandate~~have ~~that~~not, ~~cannabis~~and ~~waste~~do ~~must~~not becurrently ~~rendered~~anticipate, ~~“unusable”~~material ~~and~~capital ~~“unrecognizable”~~expenditures ~~before~~for itenvironmental ~~can~~control ~~be disposed in a landfill~~facilities. ~~Subsequently,~~ ~~in certain states~~However, itthey iscould ~~required~~become toan beincreasing ~~mixed~~expense ~~with~~for ~~non-cannabis~~the ~~waste~~Company toas ~~achieve~~we adevelop ~~ratio~~environmentally ofsustainable ~~50% cannabis waste and 50% non-cannabis waste before it can be disposed in a landfill. While many states provide various alternatives that can be mixed with cannabis waste~~practices, ~~cultivation~~especially ~~sites~~if ~~may~~enhanced ~~struggle~~environmental tolaws ~~provide~~and ~~sufficient~~regulations ~~volumes~~are ofenacted ~~non-cannabis~~for ~~waste to meet~~ the ~~required~~cannabis ~~ratio without needing to add superfluous waste or having to bring in additional waste for augmentation~~industry.

Cannabis cultivation is energy-intensive, particularly when grown indoors. Energy is essential for lighting, environmental controls, and hydration at indoor cultivation operations. Access to energy infrastructure, such as power grids, can pose challenges, leading to temporary reliance on generators powered by fossil fuels that can impact air quality. Despite these challenges, indoor cultivation remains our primary method of cultivating cannabis, driven by market demand for consistent, high-quality cannabis products year-round, independent of adverse weather and fluctuating daylight. According to the National Cannabis Industry Association, as of October 2020, an estimated 63% of commercial cannabis cultivation occurred indoors with another 20% conducted in partial indoor operations, such as greenhouses. Currently, all of the Company’s cultivation is done indoors, including in enclosed greenhouse facilities. We anticipate conducting substantially all cultivation and production in indoor facilities.

Beyond the emissions generated from electricity, the cultivation, processing, and transportation of cannabis products all contribute to air emissions. Similar to many other crops, cannabis often relies upon water supplied through artificial irrigation. Agricultural runoff from cannabis cultivation can contain wastewater pollutants, which impact the environment. While traditional agricultural practices are associated with soil erosion, nutrient loss, reduction in organic carbon stored within the soil, and increased acidity, these environmental impacts are more prevalent in outdoor cultivation.

We believe that cannabis businesses aiming to incorporate environmentally sustainable practices must start with a comprehensive plan for cultivation and production. This plan should enable operators to consider the short, medium, and long-term impacts of their operations. Such a plan must include timelines for implementation, objective metrics to gauge progress, standards to monitor compliance, and periodic evaluation of the plan itself.

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We are in the process of evaluating our operations to develop a comprehensive cultivation plan that takes into account the Company’s short, medium, and long-term environmental impacts. In doing so, we have identified emerging agricultural practices that are applicable to the cannabis industry and promote environmental sustainability. One early-stage practice for managing plant waste involves on-site anaerobic digestion utilizing plant waste to generate and capture methane, carbon dioxide, and nutrient-rich fertilizer. This approach not only diverts waste from landfills but also allows for the reuse of plant waste. To further environmental sustainability, cultivation and retail cannabis facilities could collaborate on establishing practices that promote and integrate reusable and refillable containers for their products, instead of disposable single-use packaging designs. Through proactive planning and the leveraging of business networks, the cannabis industry could collectively pursue more energy-efficient practices. Implementing LED lighting and efficient HVAC systems can significantly reduce energy use in indoor cultivation and processing facilities. Optimizing space utilization and scheduling the use of high energy equipment around peak demand periods could also help reduce the industry’s energy footprint. Existing emission control technologies have the potential to be broadly applied across the cannabis industry, mitigating adverse air quality impacts. Industry best practices should prioritize minimizing water usage, addressing agriculture runoff, and eliminating adverse impacts to water quality from any discharges back into the environment.

The federal legalization of cannabis would grant access to federal programs, including the U.S. Department of Agriculture for financial and technical assistance, the Small Business Administration for loan support, and the Environmental Protection Agency for grants, technical assistance, education, research, and traditional funding through nationally recognized financial institutions. Federal legalization has the potential to advance the industry, simultaneously safeguarding consumers and the environment through a national regulatory structure that prioritizes environmental sustainability.

Historically, expenditures for compliance with environmental laws and regulations have not been material to the Company’s financial results. In addition, we have not, and do not currently anticipate, material capital expenditures for environmental control facilities. However, they could become an increasing expense for the Company as we develop and implement a comprehensive plan for environmentally sustainable practices, especially if enhanced environmental laws and regulations are enacted for the cannabis industry.

Employees and Human Capital

The Company recruits, hires and promotes individuals that it believes are best qualified for each position, priding itself on using a selection process that recruits people who are trainable, cooperative and share our core values as a company. As of ~~February~~March 2510, ~~2025~~2026, the Company had approximately 3,800 employees across its consolidated operating jurisdictions, including corporate, retail, cultivation and processing, both full- and part-time employees, and including but not limited to: finance and accounting, legal, human resources, regulatory and compliance, supply chain and operations, sales and marketing, commercial and cannabis agriculture, chemists, customer service, construction and project management, and real estate.

We offer a comprehensive package of company-sponsored benefits to our employees. Eligibility depends on the full-time or part-time status, employee location and other factors, and benefits include medical, vision and dental plans, disability insurance, a 401(k) retirement and savings plan, employee assistance programs, paid time off, life insurance and ~~life~~voluntary pet insurance. Additionally, we believe in aligned incentives and utilize employee stock and incentive plans for a competitive total rewards program. We did not experience any work stoppages in ~~2024~~2025 that had a material impact on us, and we consider our relationship with our employees to be good.

As of ~~February~~March 2510, ~~2025~~2026, approximately ~~600~~550 employees at various cultivation and dispensary operations across our network are covered under one of 1516 collective bargaining agreements (“CBAs”).

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Social Equity

We believe that a more diverse and community-oriented focus leads to a more sustainable, inclusive and responsible cannabis industry. We aim to foster a more equitable industry where participation and success are possible regardless of the numerous factors that have historically held many people, businesses, and communities back. To support the growth of an inclusive cannabis industry, we have implemented social equity initiatives at the national level and in states and municipalities in which we operate. The social equity programs are generally designed to develop and carry out initiatives that seek to provide support and create opportunities in the cannabis industry for deprived communities, people of color and other disadvantaged minorities. In each state of operation, we seek to partner with local organizations to provide education, entrance into the cannabis industry, or other growth opportunities to both our employees and the community. To date, we have partnered with Legal Aid Chicago to host a virtual expungement and record sealing clinic to provide relief for those with nonviolent cannabis offenses. This includes our ongoing national fundraising and awareness efforts benefiting Mission Green, an organization that provides clemency, expungement and pardon support and advocacy for nonviolent individuals convicted of cannabis-related crimes, which has yielded more than $275,000 in proceeds to date.

Moreover, we have engaged various local social equity partners for our dispensary operations, including tens of thousands of dollars in donations to local food banks, resulting in thousands of hot meals for disproportionately impacted residents within the communities where we operate.

Several of our state-specific social equity programs include delineated funding for STEM (science, technology, engineering, and mathematics) coursework for disadvantaged youth, further addressing inequities within the local education system(s).

The Company has also subsidized local fire department and first responder agencies for annual supplies of Narcan to reduce the threat of overdose and death.

Lastly, the Company routinely hires within the communities where we operate.

The Company provided complimentary training to law enforcement agencies in Pennsylvania, Maryland, Connecticut and Virginia, as well as organizations such as the PA DUI Association and District Attorney's offices in Pennsylvania and Maryland. These sessions covered various product types available on the market, safe consumption practices, proper medication storage, and strategies to keep products out of children's reach. Additionally, the training addressed different routes of administration, their effects on the body, and the average time it takes for individuals to feel the effects.

In Florida, we provide medical cannabis education through certifying physicians, community outreach events and ongoing staff education, all of which are supported by a patient care call center with dozens of staff members for direct phone, email and online chat support. At the state and local level, we have focused on the region to create volunteer opportunities for employees and donate to charitable organizations, including matching employee donations.

Nationally, Verano has also conducted charitable campaigns supporting the Lynn Sage Breast Cancer Foundation for Breast Cancer Awareness Month, provided endowments for first generation college students, and hosted employee volunteer days. We plan to continue and expand these partnerships and events at the national, state and local levels to increase social equity in the cannabis industry.

Many states and cities have implemented social equity programs in connection with the legalization of medical or adult use cannabis and the Company has participated in some of these programs. These programs seek to ensure that people of color, other disadvantaged minorities and those with prior cannabis offenses, are afforded an opportunity to participate in a meaningful way in the cannabis industry. As new medical and adult use legislation is passed, multi-state operators such as the Company may be prevented, limited or discouraged from obtaining new licenses, renewing licenses or from participating in new markets or existing markets, or otherwise may be required to partner with people of color or other disadvantaged minorities.

Available Information

The Company’s website address is www.verano.com. Through this website, the Company’s filings with the SEC, including annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports, will be accessible (free of charge) as soon as reasonably practicable after materials are electronically filed with or furnished to the SEC. The information provided on the Company’s website is not part of this Form 10-K, unless otherwise noted.

28The SEC maintains an Internet site (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Canadian securities authorities also maintain an Internet site (www.sedarplus.ca) that contains reports and other information regarding the Company as an SEC Foreign Issuer in Canada.

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The SEC maintains an Internet site (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Canadian securities authorities also maintain an Internet site (www.sedarplus.ca) that contains reports, circulars, annual financial statements and other information regarding the Company.

ITEM 1A. RISK FACTORS

The Company is subject to risks, certain of which are described below. The occurrence of any one or more of these risks or uncertainties could have a material adverse effect on the value of any investment in the Company and the financial condition or operating results of the Company. Additional risks and uncertainties not presently known to the Company or that the Company currently deems immaterial may also impair the Company’s business operations. Due to the nature of the Company and its business, investors should carefully consider all such risks, including those set out in the discussion below, together with the other information in this Form 10-K and our other filings with the SEC and Canadian Securities Administrators.

Summary Risk Factors

The following is a summary of some of the risks and uncertainties that could materially adversely affect our business, financial condition and results of operations. You should read this summary together with the more detailed description of each risk factor contained below.

•regulatory and political changes to U.S. federal, state and local laws related to medical or adult use cannabis, including political risks and regulation by additional regulatory authorities;

•rescheduling may lower the barriers to entry for well-capitalized institutional competitors;

•the federal rescheduling process is subject to significant procedural delays and legal challenges;

•the impacts of economic uncertainty stemming from disruptions in U.S. and global markets, inflation, rising interest rates, and changes in consumer and business confidence;

•our outstanding indebtedness and potential future indebtedness, including our ability to repay such indebtedness;

•reliance on key management;

•market acceptance of existing and new products and potential returns or recalls of our products;

•potential cultivation biosecurity failures;

•consumer acceptance of our brand portfolio;

•the accuracy of our forecasted demand for our products;

•our ability to accurately forecast, manage and monetize inventory;

•the potential for fraudulent activity by employees, contractors and consultants;

•our exposure to growth-related operational and execution risks;

•potential negative findings in our clinical research with respect to our products;

•our ongoing litigation matter with Vireo Growth Inc., formerly known as Goodness Growth Holdings, Inc.;

•potential product liability claims;

•our exposure to natural phenomena and resulting potential uninsured or under insured losses;

•the risk that our property will be subject to civil asset forfeiture;

•our corporate structure and our resulting reliance on the performance of our subsidiaries and affiliates;

•our expansion-by-acquisition strategy;

•our ability to acquire businesses and cannabis licenses in desired markets and the integration and operation of acquired businesses;

•the typically limited operations of businesses we acquire;

•the unconventional due diligence process in the cannabis industry;

•our ability to acquire and lease properties suitable for the cultivation, production and sale of cannabis;

•potential limited representations and warranties of businesses we may acquire;

•our acquisition of businesses in developing cannabis markets;

•our lack of portfolio diversification by industry orand ~~geography~~geographic concentration;

•our use of joint ventures, strategic partnerships and alliances;

•our contractual relationships with our consolidated variable interest entities;

•existing competition and new market entrants;

•the introduction of synthetic alternatives to cannabis products by pharmaceutical and other companies;

•the immaturity of the cannabis industry and limited comparable, competitive and established industry best practices;

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•changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences;

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•wholesale and retail price fluctuations;

•public opinion and perception of the cannabis industry;

•the availability of raw or other materials;

•rising or volatile energy costs;

•agricultural and environmental risks and the impacts of environmental regulations on the cannabis industry and environmental protections;

•physical security risks, such as theft;

•potential scrutiny from Canadian authorities;

•disparate state-by-state regulatory landscapes and licensing regimes for medical and adult use cannabis;

•the difficulties cannabis businesses face accessing and maintaining banking or financial services due to federal regulations;

•the cost and difficulty of complying with various regulatory schemes;

•the impact of state social equity legislation as it relates to the cannabis industry;

•the risk of high bonding and insurance costs;

•environmental regulations;

•effects of changes in laws and policies governing employees and by union organizing activity;

•increased unionization efforts and labor shortages;

•potential scrutiny from Canadian authorities due to our status as an SEC Foreign Issuer;

•potential divestment of licenses if required by regulatory authorities;

•our dependency on the banking industry;

•required public disclosure and governmental filings containing personal information of our officers, investors and other stakeholders;

•potential findings by regulatory authorities that one of our ~~shareholders~~stockholders is unsuitable;

•the risk that our directors, officers, employees or investors are barred from entering the U.S.;

•the ability to, and constraints on, promoting and marketing cannabis products;

•potential U.S. Food and Drug Administration governance of the cannabis industry;

•the potential limitations on our ability to enforce our contracts or any liens granted to us;

•the potential lack of access to federal bankruptcy protections in the U.S.;

•reliance on information technology systems, the potential disclosure of personal information of patients and customers and cybersecurity risks;

•our increasing use of, or failure to effectively implement, artificial intelligence (AI) and automated systems;

•our reliance on third-party software providers;

•~~cost~~costs related to preserving our brand identity;

•our ability to protect our intellectual property due to limited intellectual property protection available for cannabis products and the potential infringement by third parties;

•potential infringement or misappropriation claims;

•the risk of financial crimes;

•the inability to realize the anticipated benefits of the Continuance, or to do so within the anticipated timeframe;

•the risk of receiving no return on our securities;

•our elimination of ~~monetary~~individual liability and indemnification rights against our directors, officers and employees under ~~British~~Nevada ~~Columbia~~ law;

•our ~~dual~~organizational ~~class~~documents ~~capital~~contain ~~structure~~provisions ~~with~~that ~~Class~~may Aprevent ~~subordinate~~transactions ~~voting~~that ~~shares~~could be beneficial to our stockholders and ~~Class~~may Binsulate ~~proportionate~~our ~~voting~~management ~~shares~~from removal;

•the time and resources necessary to comply with corporate governance practices and securities rules and regulations ~~in the U.S. and Canada~~;

•our management’s ability to maintain effective internal controls;

•potential dilution if we issue additional ~~Subordinate~~shares ~~Voting~~of ~~Shares~~Common ~~or Proportionate Voting Shares~~Stock;

•market perception of sales of a substantial amount of ~~Subordinate~~Common ~~Voting Shares~~Stock;

•transfer restrictions on our ~~Subordinate~~Common ~~Voting Shares~~Stock;

•price volatility of our ~~Subordinate~~Common ~~Voting Shares~~Stock;

•our ~~shareholders~~stockholders’ limited participation in our affairs;

•our expectation to not declare or pay out dividends;

•~~the~~certain ~~concentration~~of our stockholders holding Common Stock representing greater than 5% of our voting ~~control~~power; ~~and~~

•the taxation of cannabis companies in the U.S., including the impact of Section 280E of the Code; and

•other risks described in this Form 10-K, as more particularly described herein.

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Risks Related to Our Business and Operations – General

Cannabis, other than hemp, remains illegal under U.S. federal law, and therefore any change in federal enforcement could have material adverse impact on our business, financial condition and results of operations.

Under U.S. federal law, however, those activities are illegal. Cannabis, other than hemp, is currently a Schedule I controlled substance under the CSA, which means it is viewed by the U.S. federal government as a drug that has a high potential for abuse and no therapeutic value. Therefore, even in U.S. states and territories that have legalized cannabis to some extent, the cultivation, possession and sale of cannabis violates the Controlled Substances Act and is punishable by imprisonment, substantial fines and forfeiture. Moreover, individuals and entities may violate U.S. federal law if they aid and abet another in violating the Controlled Substances Act, or conspire with another to violate the law. Violating the Controlled Substances Act is also a predicate for other crimes in the U.S., including money laundering laws and the Racketeer Influenced and Corrupt Organizations Act. The U.S. Supreme Court has ruled that the U.S. federal government has the authority to regulate and criminalize the sale, possession and use of cannabis in the U.S., even for individual medical purposes, regardless of whether it is legal under state law. To date, however, the U.S. federal government has not enforced those laws against companies (and their vendors) complying with state cannabis law. In October of 2022, the Biden Administration announced its intention to review the regulation of cannabis under the CSA by directing the Secretary of Health and Human Services and the Attorney General to initiate the administrative process to expeditiously review cannabis’s Schedule I status. In August of 2023, the HHS recommended to the DEA that cannabis be rescheduled to Schedule III under the CSA. On December 2, 2024, the DEA held a preliminary formal hearing regarding the rescheduling of cannabis, and additional hearings were scheduled from January 21, 2025 to March 6, 2025. On January 13, 2025, Chief Administrative Law Judge presiding over the rescheduling of cannabis ordered that the hearing scheduled for January 21, 2025 was cancelled, and that the proceedings in the matter were stayed, pending a resolution of an interlocutory appeal to the DEA Administrator. A joint status update must be provided to the tribunal ninety (90) days from the issuance of the order, and every ninety (90) days thereafter. In addition, in November 2024, Donald Trump was elected president of the U.S. and announced that Pam Bondi would be his pick for attorney general. ~~While~~On December 18, 2025, President Trump issued the ~~ongoing~~Executive ~~rescheduling~~Order, ~~process~~which ~~could~~directs ~~result~~federal inagencies to expedite the ~~decriminalization~~process of rescheduling cannabis ~~for~~from ~~medical~~a ~~and~~Schedule ~~adult-use~~I byto ~~descheduling~~a Schedule III controlled substance under the CSA. The effect of the Executive Order may be that the cultivation, manufacturing, distribution, sale or ~~rescheduling~~possession of cannabis in the U.S. is no longer federally illegal and would lessen criminal penalties at the federal level and remove Section 280E tax considerations, ~~there~~however, the final effects are nodependent ~~assurances~~on ifother orgovernment ~~when~~actions. Despite such actions and the ongoing rule making process, there ~~could~~can be ~~any~~no ~~change~~guarantees inthat the ~~regulation~~rescheduling ofrule ~~cannabis~~making process will continue on a certain timeline or at all under this administration or that any rules will come out of the ~~CSA,~~rule ~~particularly~~making ~~due~~process tothat will benefit the ~~change~~Company. The inExecutive ~~administration~~Order, and ~~the~~agency ~~stay~~implementation toof the ~~rulemaking~~Executive ~~process~~Order does not federally legalize adult use and would not federally authorize or approve state sanctioned medical programs. Although we believe that our business activities are compliant with applicable state and local laws in the United States, strict compliance with state and local cannabis laws would not provide a defense to any federal proceeding which may be brought against us. Any such proceedings may result in a material adverse effect on us. We derive substantially all of our revenues from the cannabis industry. The enforcement of applicable U.S. federal laws poses a significant risk to us.

The likelihood of any future adverse enforcement against companies complying with state cannabis laws remains uncertain. In 2018, then-U.S. Attorney General Jeff Sessions issued the Sessions Memorandum rescinding the DOJ’s previous guidance under the Cole Memorandum that had given federal prosecutors discretion not to enforce federal law in states that legalized cannabis, as long as the state’s legal regime adequately addressed specified federal priorities. The Sessions Memorandum, which remains in effect, states that each U.S. Attorney’s Office should follow established principles that govern all federal prosecutions when deciding which cannabis activities to prosecute. As a result, federal prosecutors can use their prosecutorial discretion to decide to prosecute state-legal cannabis activities. Since the Sessions Memorandum was issued, however, U.S. Attorneys have not targeted state law compliant cannabis entities. The policy of not prosecuting companies complying with state cannabis laws continued under U.S. Attorney General Merrick Garland. The DOJ may change its enforcement policies at any time, with or without advance notice, under ~~acting~~current U.S. Attorney General, ~~James McHenry, or pending nominee,~~ Pam Bondi.

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Additionally, since 2014, versions of the U.S. omnibus spending bill have included a provision prohibiting the DOJ from using appropriated funds to prevent states from implementing their medical-use cannabis laws. While the omnibus spending bill affords some protection to medical cannabis businesses, we also operate adult use cannabis businesses that are permissible under state and local laws. Consequently, some of our operations may be outside any protections extended to medical-use cannabis under the spending bill provision. This could subject us to greater and different U.S. federal legal and other risks as compared to businesses where cannabis is sold exclusively for medical use, which, in turn, could materially and adversely affect our business. Furthermore, any change in the U.S. federal government’s enforcement posture with respect to state-licensed cannabis sales, including the enforcement postures of individual federal prosecutors in judicial districts where we operate, would lead to an inability to execute our business plan, likely resulting in significant losses with respect to our customer base and adversely affecting our business, financial condition and results of operations.

In addition to criminal liability for producing, manufacturing, distributing and selling cannabis, other subsections of the CSA criminalize related activities with expanded sentences and increased penalties for corporations. For example, entities or persons who manage or control a property and knowingly make that property available for the purposes of manufacturing, distributing or using any controlled substances can be found liable under the Controlled Substances Act. We own properties on which activities prohibited by the Controlled Substances Act occur. Therefore, a federal prosecutor could prosecute us as an owner of “drug-involved premises” and we could be found to violate U.S. federal law by virtue of these assets. Additionally, we intend to acquire and invest in businesses that are directly or indirectly engaged in the medical and adult use cannabis industry in the U.S. where state and local law permits such activities.

Our anticipated funding of businesses engaged in the medical and adult use cannabis industry, whether through loans or through other forms of investment, is currently illegal under applicable U.S. federal laws. Any criminal charges brought against us could result not only in the inability to execute our business plan, but the cessation of our operations and could further result in significant fines, penalties and losses, which would adversely affect our business, financial condition and results of operations.

THE CONSEQUENCES OF SUCH GOVERNMENTAL ENFORCEMENT WOULD BE MATERIALLY DETRIMENTAL TO US, OUR BUSINESS AND THE VALUE OF ~~THE~~OUR ~~SUBORDINATE~~COMMON ~~VOTING~~STOCK ~~SHARES~~ AND COULD RESULT IN THE FORFEITURE OR SEIZURE OF ALL OR SUBSTANTIALLY ALL OF OUR ASSETS.

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There is a substantial risk of regulatory or political change to federal, state and local laws permitting cannabis activities. Such changes could have a material adverse impact on our business, financial condition and results of operations.

Continued development of the U.S. cannabis industry depends upon legislative authorization of cannabis at the federal, state and local level. The status quo of, or progress in, the federal or state regulated U.S. cannabis industry, while encouraging, is not assured and any number of factors could slow or halt further progress in this area. The political environment surrounding the cannabis industry in the U.S. in general can be volatile and the regulatory framework remains in flux. While there may be ample public support for legislative action permitting the production and use of cannabis, numerous factors impact and can delay the legislative and regulatory processes. If pro-cannabis regulations are not enacted, or enacted but subsequently repealed or amended, or enacted with prolonged phase-in periods, our growth targets and prospects, and thus, the effect on the return of investor capital, could be extended or reduced.

Further, there is no guarantee that, at some future date, voters or the applicable state legislative bodies will not repeal, overturn or limit any such legislation legalizing the cultivation, manufacture, sale, distribution or consumption of medical or adult use cannabis. Local and city ordinances may strictly limit or restrict the applicability of state laws to their jurisdictions and the distribution of cannabis in their jurisdictions in a manner that may make it extremely difficult or impossible to transact business that is necessary for the continued operation of the cannabis industry generally and us specifically. Although our operations are legal under the laws of the states in which our business operates, local governments have the ability to limit, restrict and ban cannabis businesses from operating within their jurisdiction. Land use, zoning, ordinances and similar federal, state and local laws could be adopted or changed and have a material adverse effect on our business.

32In addition, the rule making process to reschedule cannabis to a Schedule III substance under the CSA is ongoing at the time of this filing. We cannot predict the effects such rescheduling would have on our business, and there is no guarantee that the formal rule making process will happen within a certain timeframe or that cannabis will be rescheduled. If cannabis were rescheduled to a Schedule III substance, we cannot predict the federal regulations that may be put into place regarding the cannabis industry. On December 18, 2025, President Trump issued the Executive Order, which directs federal agencies to expedite the process of rescheduling cannabis from a Schedule I to a Schedule III controlled substance under the CSA. The effect of the Executive Order may be that the cultivation, manufacturing, distribution, sale or possession of cannabis in the U.S. is no longer federally illegal and would lessen criminal penalties at the federal level and remove Section 280E tax considerations; however, the final effects are dependent on other government actions. Despite such actions and the ongoing rule making process, there can be no guarantees that the rescheduling rule making process will continue on a certain timeline or at all under this administration or that any rules will come out of the rule making process that will benefit the Company. The Executive Order, and agency implementation of the Executive Order does not federally legalize adult use and would not federally authorize or approve state sanctioned medical programs. Cannabis would still be subject to the same FDA drug approval process as all other substances, and sales outside of FDA approval, would still be criminal at the federal level. In addition, particularly considering the U.S. congressional elections that occurred in 2024, there is no guarantee that on-going pro-cannabis federal legislative efforts such as the State Reform Act or the SAFER Act will continue, that the Executive Order will result in the rescheduling of cannabis on a particular timeframe or at all, that certain legislation, such as certain banking restrictions, will change as a result of the Executive Order, or that legislation that further restricts the cannabis industry at the federal U.S. level will not be proposed or passed. We cannot predict if newly-elected state officials will adversely change the regulatory schemes regarding cannabis in the states where we operate.

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In addition, the rule making process to reschedule cannabis to a Schedule III substance under the CSA is ongoing at the time of this filing. We cannot predict the effects such rescheduling would have on our business, and there is no guarantee that the formal rule making process will happen within a certain timeframe or that cannabis will be rescheduled. If cannabis were rescheduled to a Schedule III substance, we cannot predict the federal regulations that may be put into place regarding the cannabis industry. In particular, Donald Trump was elected president of the U.S. in 2024. While Donald Trump has generally expressed support for regulations that are favorable to the U.S. cannabis industry, there is no guarantee that he will agree with President Biden’s review of the scheduling of cannabis under the CSA, or how the new administration, including new attorney general, will affect the formal rule making process. In addition, particularly considering the U.S. congressional elections that occurred in 2024, there is no guarantee that on-going pro-cannabis federal legislative efforts such as the State Reform Act or the SAFER Act will continue, or that legislation that further restricts the cannabis industry at the federal U.S. level will not be proposed or passed. Many states held elections in 2024 as well, and as such, we cannot predict if newly-elected state officials will adversely change the regulatory schemes regarding cannabis in the states where we operate.

Any one of these factors could slow or halt additional legislative authorization of cannabis, which could harm our business, financial condition and results of operations. If the U.S. federal government begins to enforce U.S. federal laws relating to cannabis in states where the sale and use of cannabis is currently legal, or if existing state laws are repealed or curtailed, our business or operations in those states or under those laws would be materially and adversely affected. As they amend or develop legislation and regulations, state and local regulators and legislatures may use the regulatory process to slow the growth of multi-state operators like us, with the intent of creating increased opportunities for resident farmers and entrepreneurs, which could severely restrict our ability to operate in those jurisdictions. Federal actions against any individual or entity engaged in the cannabis industry or a substantial repeal of cannabis related legislation could adversely affect our business and our assets or investments. Maintaining compliance with complex and ever-changing regulations and laws, including sometimes unclear regulations and laws, can be a difficult task, and a materially compliant business can be found in violation of one or more laws, rules or regulations while remaining materially or substantially compliant with applicable state cannabis laws.

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Rescheduling may lower the barriers to entry for well-capitalized institutional competitors.

For years, the Schedule I status of cannabis acted as a barrier to entry that kept large-scale pharmaceutical, tobacco, and consumer packaged goods companies from entering the industry. Schedule III status may provide the legal cover these entities need to enter the market. These competitors possess significantly greater financial resources, global supply chains, and experience with federal regulatory agencies. Due to the uncertainty of rescheduling and the potential timeline for these competitors to enter the market, the impact is unclear.

The federal rescheduling process is subject to significant procedural delays and legal challenges that could postpone or nullify any anticipated benefits.

The process of moving cannabis to Schedule III is governed by the Administrative Procedure Act, which requires a public comment period and potentially lengthy administrative hearings. Opponents of rescheduling may file lawsuits to stay or vacate the final rule, alleging procedural flaws or conflicts with international treaty obligations. Any such litigation could leave us in a state of regulatory uncertainty for years.

Challenging U.S. and global economic conditions may negatively impact our business, financial condition and results of operations.

Any disruptions and volatility in U.S. and global financial markets, inflation, potential recession and declining consumer and business confidence could lead to decreased levels of consumer spending and higher costs. Our operations have been, and could continue to be affected by inflation, and could be effected by any potential recession, real or perceived market disruptions, the unemployment level, the impact of a federal government shutdown, or rising or elevated interest rates that reach levels that influence consumer trends and spending and, consequently, impact our sales volume, pricing, cost of goods and profitability. ~~The~~In ~~Company~~addition, ~~takes~~economic auncertainty ~~cautious~~may ~~approach~~make init ~~allocating~~more ~~its~~difficult ~~capital~~ to ~~maximize~~access ~~its~~financing ~~returns~~at ~~while~~the ~~ensuring~~rates ~~appropriate~~we ~~liquidity.~~have ~~Given~~received ~~inflation~~previously. ~~and~~Further, ~~the~~continued ~~uncertainty~~high ofinterest ~~the~~rates ~~future~~may ~~economic~~increase ~~environment,~~ the ~~Company~~cost ~~has~~of ~~taken~~servicing ~~additional~~our ~~measures~~debt, inwhich ~~monitoring~~may ~~and~~limit ~~deploying~~our ~~its~~ability ~~capital~~ to ~~minimize~~fund ~~the~~capital ~~potentially~~expenditures ~~negative~~for ~~impact~~new oncultivation ~~its~~facilities. ~~operations~~Additionally, ~~and~~as ~~expansion~~cannabis ~~plans.~~remains ~~There~~a isdiscretionary nopurchase ~~guarantee~~for ~~that~~many, ~~these~~inflationary ~~measures~~pressure ~~will~~on ~~minimize~~household essentials, such ~~potentially~~as ~~negative~~food, ~~impacts~~fuel and ~~that~~rent, wecould ~~may~~lead ~~not~~consumers ~~continue~~ to ~~take~~trade ~~further~~down ~~measures~~to inlower-margin ~~the~~value ~~future.~~brands Inor ~~addition,~~reduce ~~economic~~their ~~uncertainty~~overall ~~may~~frequency ~~make~~of itpurchase, ~~more~~potentially ~~difficult~~leading to ~~access~~further ~~financing~~price atcompression ~~the~~in ~~rates~~certain ~~we have received previously~~markets.

These macroeconomic developments could negatively impact our business, which depends on the general economic environment and levels of consumer spending. In addition, macroeconomic conditions could cause budgetary pressures for our wholesale and end customers, which could result in a delay or reduction in their spending, and in turn could adversely affect our business. We may not be able to maintain our existing customers or attract new customers, or we may be forced to increase or reduce the price of our products. We are unable to predict the likelihood of the occurrence, duration, or severity of a recession or other disruptions in the U.S. credit and financial markets and adverse U.S. and global economic conditions. Any general or market-specific economic downturn could have a material adverse effect on our business, financial condition and results of operations.

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The Company and certain of our subsidiaries are borrowers under secured debt facilities, and we may be unable to repay, renew or refinance our indebtedness when it becomes due. Further, our debt facilities contain covenants that restrict our business and they may be difficult or costly for us to comply with. If we are unable to repay, renew or refinance our debts as they become due, it would have a material adverse effect on our business, financial condition and results of operations and the value of ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock.

The Company and certain of our subsidiaries are borrowers of secured indebtedness and are subject to risks typically associated with secured debt financing, which are heightened by the cannabis regulatory environment in the U.S. Our cash flows could be insufficient to satisfy the amount of required payments of principal and interest and we may not be able to repay our indebtedness. Our ability to make scheduled payments of principal and interest on our indebtedness when due depends on our future cash flow which is subject to the financial performance and results of our business, the value of our assets, prevailing economic conditions, the cannabis regulatory environment, prevailing interest rate levels and other financial, competitive and operational factors impacting the cannabis industry, many of which are beyond our control.

The covenants of our indebtedness limit our ability to engage in activities that may be in the Company’s long-term best interest. In addition, compliance with the financial, operational and reporting covenants, including obligations to maintain minimum cash balances at certain financial institutions, increases our legal and financial costs, make certain activities more difficult or restricted, and may be time-consuming or costly and increase demand on the Company’s systems and resources. Our failure to comply with any of these covenants could result in a default, which could result in increased default interest rates, the acceleration of repayment of our debt or our lenders’ foreclosure on our assets securing our indebtedness.

We may not be able to renew or refinance our indebtedness, ~~including indebtedness under the 2022 Credit Agreement or the Loan Agreement~~ on substantially similar terms, or at all, particularly in an environment of economic uncertainty such as the one discussed above in “—Challenging U.S. and global economic conditions may negatively impact our business, financial condition and results of operations.” Our ability to access short-term and long-term lending and capital markets to obtain, and the availability of acceptable terms and conditions of, financing are impacted by many factors, including the liquidity and volatility of the overall lending and capital markets, the cannabis regulatory environment and the current state of the economy, including the cannabis industry. There can be no assurances that we will be able to access the lending and capital markets to refinance our indebtedness. We may have to pay higher interest rates and additional fees and expenses, and we may have to agree to terms that could increase the cost of our indebtedness structure. If we are unable to renew or refinance our indebtedness on terms that are not materially less favorable than the terms currently available to us or obtain alternative or additional financing arrangements, we may not be able to timely repay our indebtedness, which may result in a default under our indebtedness, which could result in our lenders’ foreclosure on our assets securing our indebtedness.

The Company and our subsidiaries may incur additional indebtedness, and we may be unable to borrow on better or substantially similar terms to our existing indebtedness. New indebtedness facilities may contain covenants that further restrict our business and they may be difficult or costly for us to comply with. If we were to incur additional indebtedness that increases the cost of our indebtedness structure, it would have a material adverse effect on our business, financial condition and results of operations and the value of ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock.

We may incur additional indebtedness. As funds are borrowed, additional interest and debt service increases the expense of operating our business. In addition, lenders of future borrowings may require additional restrictions on our business and operations and additional assets to secure our obligations. Our ability to access short-term and long-term lending and capital markets to obtain, and the availability of acceptable terms and conditions of, financing are impacted by many factors, including the liquidity and volatility of the overall lending and capital markets, the cannabis regulatory environment and the current state of the economy, including the cannabis industry. We may have to pay higher interest rates and additional fees and expenses, and we may have to agree to terms that could increase the cost of our indebtedness structure.

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We rely on the expertise of our management team and other employees experienced in the cannabis industry, and the loss of key personnel could negatively affect our business, financial condition and results of operations.

Our success largely depends upon the continued services of our executive officers and management team members. If one or more of our executive officers or management members is unable or unwilling to continue in his or her present position, we may not be able to replace such individual readily, if at all. Additionally, we may incur additional expenses to recruit and retain new executive officers and management members and personnel with experience in the cannabis industry. We do not maintain “key person” life insurance on any of our executive officers. Because of these factors, the loss of the services of any key persons could adversely affect our business, financial condition and results of operations.

We face risks related to our products.

We have committed and expect to continue committing significant resources and capital to develop and market existing products and new products and services. These products are relatively untested in the marketplace, and we cannot assure that we will achieve market acceptance for new products and services that we may offer in the future, or that our products that achieve market acceptance will maintain that acceptance over time. Moreover, these and other new products and services may be subject to significant competition with offerings by new and existing competitors. In addition, new products and services may pose a variety of challenges and require us to attract additional qualified employees. The failure to successfully develop and market these new products and services could have a material adverse effect on our business, financial condition and results of operations. We also face competition from hemp and illicit market products that are not subject to testing or regulation by state agencies and that are not subject to the same taxes state-legal cannabis businesses face, and may be priced significantly lower than our products.

Our products may be returned or recalled, which could damage our brand identity and adversely affect our business, financial condition and results of operations.

Despite quality control procedures, cultivators, manufacturers and distributors of cannabis products are sometimes subject to the recall or return of their products for a variety of reasons, including product defects, such as contamination, unintended harmful side effects or interactions with other substances, packaging safety and inadequate or inaccurate labeling disclosure. While we employ testing procedures, there is no guarantee such procedures will catch all defects. If any of our products or any of the products that we purchase from a third party are recalled due to an alleged product defect or for any other reason, we could be required to incur the unexpected expense of the recall and any legal proceedings that might arise in connection with the recall, and may lose a significant amount of sales and may not be able to replace those sales at an acceptable margin or at all. A recall or return of our products could lead to a deterioration in our brand identity, decreased demand for our products or limit our ability to purchase from a third-party and could have a material adverse effect on our business, financial condition and results of operations.

Cultivation biosecurity failures, including the introduction or spread of plant pathogens such as Hop Latent Viroid (“HpLVd”), could materially adversely affect our yields, product quality, and operating results.

HpLVd can remain asymptomatic for extended periods while significantly reducing plant vigor, yield, and cannabinoid potency, which may delay detection and amplify losses. Despite the testing processes we employ, pathogens may spread through infected clones, tools, personnel movement, or shared environments, and our biosecurity, testing, sanitation, and quarantine controls may prove insufficient or inconsistently executed. An outbreak could require crop destruction, facility remediation, replacement of genetics, and extended production downtime, resulting in inventory write-downs, higher operating costs, supply shortfalls, margin compression, and reputational harm. Limitations in diagnostic accuracy or timing, reliance on third-party inputs, and human execution risk may further constrain prevention and response efforts. If we are unable to effectively prevent, detect, or mitigate such biosecurity incidents, our business, financial condition, and results of operations could be materially adversely affected.

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We are dependent on the popularity of consumer acceptance of our brand portfolio.

Our ability to generate revenue and be successful in the implementation of our business plan is dependent on consumer acceptance of and demand for our products. Acceptance of our products depends on several factors, including availability, cost, ease of use, familiarity of use, convenience, effectiveness, safety and reliability. If customers do not accept our products, or if such products fail to adequately meet customers’ needs and expectations, our ability to continue generating revenues could be reduced. As the number of available licenses increase in the markets in which we operate, and the illicit market and psychoactive hemp-based products proliferate, additional competition and increased product availability may result in competitors undercutting our prices. From time to time, we may need to reduce our prices in response to competitive and customer pressures and to maintain our market share, which could materially reduce our revenues.

Our sales volumes are difficult to forecast and a failure in the expected demand for our products to materialize could have a material adverse effect on our business, financial condition and results of operations.

As a result of the early stage of the cannabis industry, ongoing U.S. state and federal regulatory and policy changes for medical and adult use cannabis and unreliable levels of market supply, the market data available for cannabis demand can be limited. We must rely largely on our own market research to forecast sales, as detailed forecasts are not generally obtainable from other sources in the states in which our business operates. Additionally, any market research and our own projections of sales, demographics, demand and similar consumer research, are based on assumptions from limited and unreliable market data. A failure in the expected level of demand for our products to materialize as a result of competition, regulatory changes, technological change or other factors could have a material adverse effect on our business, financial condition and results of operations.

35Our ability to accurately forecast, manage, and monetize inventory is subject to uncertainty and could materially adversely affect our operating results.

~~Table~~As a multi-state cannabis operator, inventory predictability is affected by biological variability in cultivation cycles, inconsistent yields and potency, biosecurity events, regulatory testing and hold periods, processing capacity constraints, and variability in consumer demand across markets and product categories. Forecasting errors or operational disruptions may result in excess, obsolete, or aged inventory requiring discounting, reprocessing, or destruction, as well as inventory write-downs or impairments. Conversely, inventory shortfalls may limit our ability to meet customer demand, fulfill wholesale commitments, or maintain retail shelf availability, adversely affecting revenue, margins, and brand equity. Additionally, inventory planning relies on assumptions regarding market growth, pricing, regulatory conditions, and execution across cultivation, manufacturing, and distribution functions, which may not prove accurate. If we are unable to effectively predict and align inventory levels with demand and operational capacity, our business, financial condition, and results of ~~Contents~~operations could be materially adversely affected.

There is a risk of fraudulent or illegal activity by our employees, contractors and consultants, and any fraudulent or illegal acts could negatively affect our business, financial condition and results of operations.

We are exposed to the risk that our employees, independent contractors and consultants may engage in fraudulent or other illegal activity. Misconduct by these parties could include intentional, reckless or negligent conduct or disclosure of unauthorized activities that violates: (i) government regulations; (ii) manufacturing standards; (iii) federal and state healthcare fraud and abuse laws and regulations; (iv) laws that require the true, complete and accurate reporting of financial information or data; (v) our contractual agreements; or (vi) our policies and code of ethics. It may not always be possible for us to identify and deter misconduct by our employees and other third parties, and the precautions taken by us to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. If any such investigations or actions are instituted against us, and we are not successful in defending them or asserting our rights, those actions could have a significant impact on our business, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, contractual damages, reputational harm, diminished profits and future earnings and curtailment of our operations, any of which could have a material adverse effect on our business, financial condition and results of operations.

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We are subject to growth-related operational and execution risks and our inability to mitigate and address these risks would have a material adverse effect on our business plan, financial results and financial condition.

We are subject to growth-related operational and execution risks, including integration of acquired businesses, ~~facility~~facilities, systems, personnel, and other capacity constraints, efficient management of assets and pressure on our internal systems and controls. Our ability to manage growth effectively will require us to continue to implement and improve our integration processes and operational and financial systems and to expand, train and manage our employee base. Our inability to effectively manage our growth may have a material adverse effect on our business financial results and financial condition.

Past performance is not necessarily indicative of future results, and if our actual operations differ materially from management’s expectations, it could have a material adverse effect on our business, financial condition and results of operations.

Our growth is in large part attributable to acquisitions of existing cannabis businesses and licenses. Our past operational performance may not be indicative of our future operating results. There can be no assurance that the revenue growth, cashflow, operating margins and other historical operating results achieved by us will be achieved by us going forward, and our financial performance and operating results may be materially different.

Clinical research with respect to our products is ongoing, and negative findings could lead to rollbacks of state legalizations laws and negative public perceptions of cannabis, which would negatively affect our business, financial condition and results of operations.

Research in the U.S. and internationally regarding the medical benefits, viability, safety, efficacy, dosing and social acceptance of cannabis or isolated cannabinoids remains in early stages. There have been relatively few clinical trials on the benefits of cannabis or isolated cannabinoids. Although we rely on the articles, reports and studies that support our beliefs regarding the medical benefits, viability, safety, efficacy, dosing and social acceptance of cannabis, future research and clinical trials may prove such beliefs to be incorrect, or could raise concerns regarding, and public perceptions relating to, cannabis. Further, the cannabis industry is highly dependent upon consumer perception, which can be significantly influenced by scientific research or findings, regulatory investigations, litigation, media attention and other publicity regarding the consumption of cannabis products. There can be no assurance that future scientific research or findings, regulatory investigations, litigation, media attention or other publicity will be favorable to the cannabis market or any particular product, or consistent with earlier publicity.

Future research studies and clinical trials may reach negative conclusions regarding the medical benefits, viability, safety, efficacy, dosing, social acceptance or other facts and perceptions related to cannabis, which could lead to rollbacks in state regulation or otherwise have a material adverse effect on the demand for our products with the potential to lead to a material adverse effect on our business, financial condition and results of operations. There is no assurance that such adverse research studies or clinical trials will not arise.

36We may be subject to litigation.

We may become party to litigation from time to time in the ordinary course of business, which could adversely affect our business. Should any litigation in which we become involved be determined against us, such a decision could adversely affect our ability to continue operating and the market price for the Common Stock. Even if we are involved in litigation and win, litigation can redirect significant financial and other resources of the Company.

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We are currently involved in litigation with GGH arising from our termination of the GGH Arrangement Agreement. Any unfavorable verdict or settlement of the litigation with GGH could have a material adverse effect on our business, financial condition, results of operations and the Subordinate Voting Shares. We also may be a party to other material litigation that requires outsized expenses or results in negative outcomes that could affect our business, financial condition, results of operations and Subordinate Voting Shares.

We are currently involved in litigation with Vireo Growth Inc., formerly known as Goodness Growth Holdings, Inc. (“GGH”). On January 31, 2022, we entered into an Arrangement Agreement (the “GGH Arrangement Agreement”) with GGH, pursuant to which we agreed to acquire all of the issued and outstanding equity interests of GGH in exchange for equity interests in the Company. On October 13, 2022, we provided written notice to GGH of the exercise of our termination rights under the GGH Arrangement Agreement. On October 21, 2022, GGH filed suit against us in the Supreme Court of British Columbia alleging that the Company breached (i) the GGH Arrangement Agreement through, among other things, the purported wrongful repudiation of the GGH Arrangement Agreement, (ii) the duty of good faith, and (iii) the duty of honest performance in contract. We filed a counterclaim on November 14, 2022 asserting that GGH owes us a termination fee in the amount of $14,875,000, or alternatively, the reimbursement of out-of-pocket fees and expenses of up to $3,000,000 as a result of our termination of the GGH Arrangement Agreement, which was based upon our belief that GGH breached covenants and representations in the GGH Arrangement Agreement and the occurrence of other termination events. GGH filed a response to such counterclaim on December 7, 2022, in which GGH denied it was obligated to pay any termination fee or transaction expenses.

On May 2, 2024, GGH filed an application with the Supreme Court of British Columbia seeking an order granting summary trial in the ongoing litigation between the Company and GGH regarding the GGH Arrangement Agreement. In the application, GGH stated it is seeking $860,900,000 in damages, plus costs and interest (the “GGH Application for Summary Trial”). On June 19, 2024, the Company filed an application in response seeking: (i) dismissal of the GGH Application for Summary Trial on the grounds that the issues raised by it are not suitable for disposition by summary trial and will not assist the efficient resolution of the proceeding; and (ii) an order that the report on damages filed by GGH in support of the GGH Application for Summary Trial is inadmissible and shall be excluded from evidence in the trial, or any summary trial, of this matter. On September 17, 2024, the Company filed an amended response and counterclaim with the Supreme Court of British Columbia, primarily in response to communications recently disclosed by GGH.

We can provide no guarantees or assurances that we will prevail or be able to settle this lawsuit or our counterclaim on favorable terms, if at all. This lawsuit, our counterclaim and future litigation, including any shareholder litigation or governmental or regulatory investigation, could have a material adverse effect on our business, results of operations, financial condition, reputation and cash flows, as well as on the market price of the Subordinate Voting Shares.

The Company or our subsidiaries may become party to litigation from time to time which could be concluded in a way which is adverse to us and could adversely affect our business operations and use significant resources. Although the results of lawsuits and claims cannot be predicted with certainty, defending and prosecuting these claims is costly and can impose a significant burden on management and employees. Any litigation to which we are a party may result in an unfavorable judgment that may not be reversed on appeal, or we may decide to settle lawsuits on similarly unfavorable terms. Any such negative outcome could result in payments of substantial monetary damages or fines, changes to our business practices, and could have a material adverse effect upon our business, financial condition, results of operations and the Subordinate Voting Shares.

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We may be subject to product liability claims which could adversely affect our business, financial condition and results of operations.

We manufacture, process and distribute products designed to be ingested and used topically by humans, and therefore we face an inherent risk of exposure to product liability claims, regulatory action and litigation if our products are alleged to have caused loss or injury. In addition, the manufacture and sale of cannabis products involve risk of injury to consumers due to tampering by unauthorized third parties or product contamination. Previously unknown adverse reactions resulting from human consumption and use of cannabis products alone or in combination with other medications or substances could occur. Although we have quality control procedures in place, we may be subject to various product liability claims, including, among others, that the products produced by us, or the products that we purchase from third party licensed producers, caused injury or illness, include inadequate instructions for use or include inadequate warnings concerning possible side effects or interactions with other substances. A product liability claim or regulatory action against us could result in increased costs, could adversely affect our reputation, and could have a material adverse effect on our business, financial condition and results of operations. There can be no assurances that product liability insurance will be obtained or maintained on acceptable terms or with adequate coverage against potential liabilities.

We are exposed to various operational risks and natural phenomena, any of which may be uninsured or underinsured, and uninsured losses could have a material adverse effect on our business, financial condition and results of operations.

We may be affected by a number of operational risks and natural phenomena for which we may not be adequately insured, including labor disputes; catastrophic accidents; fires; blockades or other acts of social activism; equipment defects, malfunction and failures; changes in the regulatory environment; impact of non-compliance with laws and regulations (both related and unrelated to the cannabis industry); the outbreak of a global pandemic; and inclement weather conditions, hurricanes, floods, earthquakes and other natural disasters. Such risks can cause interruption of operations, shortage of staff, disruption of supply chain, market volatility, personal injury, loss of life, suspension of operations, damage to facilities, damage to or destruction of property, equipment and the environment. There is no assurance that the foregoing risks and hazards will not result in damage to, or destruction of, our properties, dispensary facilities and cultivation and production facilities, or cause personal injury or death, environmental damage or have an adverse impact on our operations, costs, monetary losses, potential legal liability and adverse governmental action, any of which could have a material adverse effect on our business, financial condition and results of operations.

In addition, there can be no assurance that we will not encounter hazardous conditions, such as asbestos or lead, at the sites of the real estate used to operate our business, which may delay the development of our business. Climate change or significant weather events may accelerate or exacerbate environmental conditions in ways that adversely affect the business due to potential negative effects on agricultural conditions, increased difficulty in construction projects to support our operations, and ownership or leasing of real property generally. Upon encountering a hazardous condition, work at our facilities may be suspended. If we receive notice of a hazardous condition, we may be required to correct the condition prior to continuing construction. If additional hazardous conditions were present, it would likely delay construction and may require significant expenditure of our resources to correct the conditions. Such conditions could have a material adverse effect on our business, financial condition and results of operations.

We plan to continuously monitor our operations for quality control and safety and to mitigate risk. However, there are no assurances that our safety procedures will always prevent damage and we may be affected by liability or sustain losses in respect of risks and hazards. Although we maintain insurance coverage, such insurance does not cover all of the potential risks associated with our business and operations, including natural disasters.

The cost of insurance for companies engaged in cannabis-related activities is higher than many other industries and we may be unable to maintain insurance to cover these risks at economically feasible premiums, in part or at all. In addition, insurance coverage may not be available to us or may not be adequate to cover any resulting liability. In certain locations where we operate, such as Florida, it may be difficult to get insurance at reasonable costs, or at all, that will adequately cover adverse weather events such as hurricanes. Moreover, insurance against risks such as environmental pollution or other hazards encountered in our operations is not generally available on acceptable terms. The occurrence of a significant uninsured claim, a claim in excess of the insurance coverage limits then maintained by us, or a claim at a time when we are not able to obtain liability insurance, could have a material adverse effect on our business, financial condition and results of operations.

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Our property is subject to risk of civil asset forfeiture.

Because the cannabis industry remains illegal under U.S. federal law, any property owned by participants in the cannabis industry that is either used in the course of conducting or comprises the proceeds of a cannabis business could be subject to seizure by law enforcement and subsequent civil asset forfeiture. Even if the owner of the property were never charged with a crime, the property in question could still be seized and subject to an administrative proceeding by which, with minimal process, it could become subject to forfeiture.

Changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences, may have a material adverse impact on our business, operating results, and financial condition.

Our business requires significant packaging, construction, and other materials. We strategically and proactively procure these materials from our suppliers in sufficient quantities to facilitate supply chain demands and on relevant construction timelines. On February 20, 2026, the U.S. Supreme Court ruled that certain previously imposed tariffs under the International Emergency Economic Powers Act (“IEEPA”) were unauthorized. While this ruling may lead to potential refunds of duties previously paid, President Trump immediately transitioned to a new 15% global import tariff under Section 122 of the Trade Act of 1974 (the “Trade Act”). We cannot yet predict the effect of these new tariffs, recently imposed or future U.S. tariffs on imports or the extent to which other countries will impose quotas, duties, tariffs, taxes or other similar restrictions upon the import of materials in the future, nor can we predict future trade policy or the terms of any renegotiated trade agreements and their impact on our business.

The U.S. government has adopted new approaches to trade policy and in some cases, may renegotiate, or potentially terminate, certain existing bilateral or multi-lateral trade agreements. While the Supreme Court has limited the President’s authority to impose open-ended tariffs under IEEPA, the administration has utilized alternative statutory authorities, such as Section 122, to impose time-limited surcharges, and has raised the possibility of seeking congressional extensions or imposing significant additional tariff increases under Section 232 or Section 301of the Trade Act or expanding the tariffs to capture other countries and certain types of foreign goods. A significant portion of our operational infrastructure, including LED lighting, climate control systems, extraction hardware, and specialized packaging, is sourced from international markets, particularly China and Southeast Asia. Recent and proposed shifts in U.S. trade policy, including the current 15% global tariff and other tariffs on certain imports, could drastically increase the cost of building out or maintaining our facilities. These costs are difficult to pass on to consumers in a highly competitive, price-sensitive market. Additionally, the legal and administrative uncertainty following the recent U.S. Supreme Court ruling, including the process for seeking duty refunds and the potential for rapid shifts between different statutory tariff regimes, may make it more difficult or costly for us to procure packaging, construction, and other materials. As a result, we may experience supply chain interruptions or increased pricing of such procured materials and planned projects may be delayed, which could have a material adverse effect on our current and expansion strategy as well as our business, operating results and financial condition.

In addition, in response to both the invalidated IEEPA tariffs and the newly imposed Section 122 tariffs, other countries have implemented or may implement retaliatory tariffs on U.S. goods. Political tensions as a result of trade policies could reduce trade volume, investment, technological exchange, and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets, which could in turn have a material adverse impact on our business, operating results and financial condition.

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Risks Related to Our Business and Operations – Organizational Structure and Acquisition-Based Strategy

The Company is the ultimate holding company in its corporate organizational structure. As such, the Company depends on the performance of its subsidiaries and affiliates and therefore any material declines in the financial health or prospects of these entities will adversely affect our business, liquidity, financial condition and results of operations.

We are a holding company, and the vast majority of our assets are the ownership interests we hold in our subsidiaries. As a result, our investors, lenders and creditors are subject to the risks attributable to our subsidiaries. As a holding company, we conduct all of our business operations through our subsidiaries and affiliates, which generate all of our revenues. Consequently, to the extent we cannot raise funds from the issuance of debt or equity securities, our cash flow and ability to complete our business plan and growth objectives are dependent on the earnings of our subsidiaries and the distribution of those earnings to us. The ability of our subsidiaries and affiliates to pay dividends and other distributions to us or to any of our other subsidiaries will depend on their operating results and are subject to laws and regulations which require that solvency and capital standards be maintained as well as contractual restrictions contained in mortgages, credit facilities and other similar agreements. In the event of a liquidation or reorganization of any of our subsidiaries or affiliates, lenders and trade creditors may be entitled to payment of their claims from the assets of such subsidiaries or affiliates before us. Accordingly, any decline in the financial performance or prospects of any of our subsidiaries or affiliates will adversely affect our investment in such subsidiaries or affiliates, the value of our assets and our ability to receive cashflow and realize a return on our investment.

We engage in acquisitions, dispositions and other strategic transactions, which present numerous execution risks. We may encounter unforeseen obstacles related to these transactions that would negatively impact our business, financial condition and results of operations and ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock.

Material acquisitions, dispositions and other strategic transactions involve a number of execution risks, including: (i) potential disruptions to our ongoing business; (ii) distraction of management; (iii) our becoming more financially leveraged; (iv) the anticipated benefits and cost savings of those transactions not being realized fully, or taking longer to realize than expected; (v) an increase in the scope and complexity of our operations, including in employee relations as a result of growth or acquiring existing union and collective bargaining agreements; and (vi) a loss or reduction of control over our assets. Additionally, we may issue ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ and other equity interests as consideration in such transactions, which issuances would dilute our existing ~~shareholders~~stockholders’ equity holdings in the Company.

Our acquisitions are subject to varying degrees of approval which include in some cases, among other things, (i) approval by the Company’s ~~shareholders~~stockholders; (ii) approval by local and state authorities of the change in ownership in the cannabis licensee or the deemed sale, transfer or assignment of the cannabis-related licenses; and (iii) other state and local regulatory approvals. We are unable to predict when all required approvals or authorizations will be obtained, if at all.

After acquisitions are consummated, the presence of one or more material liabilities of an acquired company or limitations on its operations that are unknown to us at the time of acquisition could have a material adverse effect on our business, financial condition and results of operations.

We may not be able to identify and acquire businesses and cannabis licenses in desired markets or successfully integrate acquired businesses and assets that we deem necessary to achieve our desired growth, which would negatively impact our business plans, financial condition and results of operations.

The ability to achieve desired growth will depend in part on our ability to identify, evaluate, successfully negotiate and consummate acquisition and investment opportunities with target companies on prices that reflect the value of such target companies. Achieving this objective in a cost-effective manner is a product of our sourcing capabilities, our management of the negotiation and investment process, the ability to structure and provide purchase prices on terms that are attractive to target companies as well as our access to financing on acceptable terms. Failure to successfully consummate and integrate suitable acquisitions and investments could have a material adverse effect on our business, financial condition and results of operations.

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Many of the businesses that we acquire or invest in are early-stage companies that may have limited operations or revenues. These businesses may underperform our targets and projections and thus negatively impact our business, financial condition and results of operations.

We may acquire and make investments in businesses that we perceive to have potential future value but have little operating history, no significant sources of operating cash flow and no revenues from operations. Our resources and opportunity costs spent on these companies are subject to risks and uncertainties that new businesses with no operating history or limited financial results may face. In particular, there is a risk that these early-stage businesses will not be able to meet anticipated performance targets or financial projections, which could have a material adverse effect on our business plans, financial condition and results of operations.

The uncertain, fragmented and early-stage nature of the cannabis industry often results in an unconventional due diligence process and acquisition and transaction terms that could result in unknown and materially detrimental consequences to us.

The uncertainty inherent in various aspects of the cannabis industry can result in what otherwise would be considered inadequate acquisition and investment due diligence information and assumption of uncertain legal consequences relative to a target acquisition or investment. The reluctance of banks and other financial institutions to facilitate financial transactions in the cannabis industry can result in inadequate and unverifiable financial information about target acquisitions and investments, as well as cash management practices that are vulnerable to theft and fraud. The lack of established, traditional sources of financing for industry participants can result in unusual and uncertain arrangements affecting the ownership and obligations of a target investment. The reluctance of some professionals and advisors to represent cannabis-industry participants in financings and other business transactions can result in the lack of documentation setting forth the terms of agreements and understandings, inadequately documented transactions, and transactions that in whole or in part do not comply with applicable state or local laws, among other detrimental consequences. We have acquired or invested in, and may in the future acquire or invest in, businesses and companies that are or may become party to unforeseen legal proceedings, have inadequate financial and other due diligence information, employ vulnerable cash management practices, lack written or adequate legal documents governing significant transactions, lack policies and processes with respect to compliance with laws and otherwise have known or unknown conditions that could be detrimental to its business and assets, which in turn could have a material adverse effect on our business, financial condition and results of operations.

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Competition for the acquisition and leasing of properties suitable for the cultivation, production and sale of medical and adult use cannabis may impede our ability to make acquisitions or increase the cost of these acquisitions, which could negatively impact our business, financial condition and results of operation.

We compete for the acquisition of properties suitable for the cultivation, production and sale of medical and adult use cannabis with entities engaged in agriculture and real estate investment activities, including corporate agriculture companies, cultivators, producers and sellers of cannabis. In addition, in certain markets the local governments have authority to choose where any cannabis establishment will be located. These authorized areas are frequently removed from other retail operations. Because the cannabis industry remains illegal under U.S. federal law, the disadvantaged tax status of businesses deriving their income from cannabis, and the reluctance of the banking industry to support cannabis businesses, it may be difficult for us to locate and obtain the rights to operate at various preferred locations. Property owners may violate their mortgages by leasing to us, and those property owners that are willing to allow use of their facilities may require payment of above fair market value rents to reflect the scarcity of such locations and the risks and costs of providing such facilities. All of these factors may prevent us from acquiring and leasing desirable properties, may cause an increase in the price we must pay for properties or may result in us having to lease our properties on less favorable terms than we expect.

Our competitors may have greater financial and operational resources than we do and may be willing to pay more for certain assets or may be willing to accept more risk than we believe can be prudently managed. In particular, larger companies may enjoy significant competitive advantages that result from, among other things, a lower cost of capital and enhanced operating efficiencies.

Our competitors may also adopt transaction structures similar to ours, which would decrease our competitive advantage in offering flexible transaction terms. In addition, due to a number of factors, including but not limited to potential greater clarity of the laws and regulations governing medical cannabis by state and federal governments, the number of entities and the amount of funds competing for suitable investment properties may increase, resulting in increased demand and increased prices paid for these properties. If we pay higher prices for properties or enter into leases for such properties on less favorable terms than we expect, our profitability and ability to generate cash flow may be adversely impacted. Increased competition for properties may also preclude us from acquiring those properties that would generate attractive returns to us.

We may purchase businesses and assets with limited representations and warranties from, or recourse to, the sellers of those businesses and assets. These limited representations and warranties and lack of recourse could result in no or limited legal remedies for unknown and materially detrimental problems with the business or assets we acquire, which in turn ~~would~~could negatively impact our business, financial condition and results of operations.

We may acquire businesses and assets with only limited representations and warranties from the sellers regarding the quality of the business, its operating results, liabilities and risks and quality of assets. We may have limited or no recourse to the sellers if they ~~breached~~breach their representations or warranties in the applicable transaction documents. As a result, if defects or liabilities are subsequently discovered, we may not be able to pursue a claim for damages against the sellers. The extent of damages that we may incur as a result of such matters cannot be predicted, but potentially could have a material adverse effect on the value of our assets and revenue streams and financial performance. Further, some of our remedies and recourse may consist of obligations of cannabis operations, and our remedies may be limited if deemed unenforceable under federal laws or for other regulatory reasons.

We may enter or acquire businesses in developing markets where regulation of medical or adult use cannabis is uncertain or in process, exposing us to additional risks and expenses with respect to regulatory compliance.

We may enter markets or acquire businesses and assets in developing markets where the regulation of cannabis is uncertain. The medical or adult use cannabis regulatory regime in a market may not be settled at such time and final regulations with respect to cannabis licenses may still be unknown. If final regulations differ from our expectations, or the existing terms of the acquired license are changed by the adoption of final regulations, we may realize less value from the expansion or acquisition than expected. This possibility, as well as other general uncertainties surrounding cannabis markets with regulation that is not established, could have ~~negative~~ consequences detrimental to our business plan and asset values, which in turn could have a material adverse effect on our business, financial condition and results of operations.

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Our business and asset portfolio are not highly diversified by ~~either~~ industry orand our sales are geographically concentrated. If our cannabis business and assets underperform, our business, financial condition and results of operations would be negatively impacted.

Our assets are associated with the medical and adult use cannabis industry. While we may purchase other assets and make investments not limited to the cannabis industry, we intend to maintain and continue to acquire businesses, licenses and assets related to the cannabis industry. Thus, we have, and are expected to have, limited industry diversity as to asset type and revenue generation. Additionally, our business is geographically concentrated in the U.S. states in which we hold licenses to operate cannabis-related businesses. In particular, we have substantial operations in Florida, which accounted for approximately 28% of our consolidated sales as of December 31, 2025, where all sales are for medical products and are generated solely by our retail stores given the vertical integration requirements of Florida’s cannabis regulations. As a result, our business, financial condition, and results of operations are particularly sensitive to economic, regulatory, and competitive conditions in Florida. Should economic conditions deteriorate, competitive pressure intensify, or adverse regulatory changes occur within the region, our results of operations and financial position would be negatively impacted. In addition, Florida is prone to extreme weather events and natural disasters, such as hurricanes, which could cause significant property damage, business interruption, or supply chain disruptions. Insurance coverage for such events may be unavailable, inadequate, or prohibitively expensive. Furthermore, any adverse changes in state law, delays in the potential legalization of adult-use cannabis, or unfavorable regulatory actions could materially impact our business. See “--We are exposed to various operational risks and natural phenomena, any of which may be uninsured or underinsured, and uninsured losses could have a material adverse effect on our business, financial condition and results of operations” for more information. This lack of industry and geographic diversification increases the risk associated with the revenue ~~stream~~streams we expect to receive from our businesses and assets and, as a result, could have a material adverse effect on our business, financial condition and results of operations.

Our use of joint ventures, strategic partnerships and alliances may expose us to risks associated with jointly owned investments.

We currently operate parts of our business through joint ventures with other companies or individuals, and we may enter into additional joint ventures and strategic alliances in the future. Joint venture investments may involve risks not otherwise present in investments made solely by us, including: (i) we may not control the joint ventures; (ii) our joint venture partners may not agree to distributions that we believe are appropriate; (iii) where we do not have substantial decision-making authority, we may experience impasses or disputes with our joint venture partners on certain decisions, which could require us to expend additional resources to resolve such impasses or disputes, including litigation or arbitration; (iv) our joint venture partners may become insolvent or bankrupt, fail to fund their share of capital contributions or fail to fulfill their obligations as a joint venture partner; (v) the arrangements governing our joint ventures may contain certain conditions or milestone events that may never be satisfied or achieved; (vi) our joint venture partners may have business or economic interests that are inconsistent with ours and may take actions contrary to our interests; (vii) we may suffer losses as a result of actions taken by our joint venture partners with respect to our joint venture investments; and (viii) it may be difficult for us to exit a joint venture if an impasse arises or if we desire to sell our interest for any reason. Any of the foregoing risks could have a material adverse effect on our business, financial condition and results of operations. In addition, we may, in certain circumstances, be liable for the actions of our joint venture partners.

The contractual arrangements we have with our consolidated variable interest entities (“VIEs”) isare not as secure as direct ownership of such entities.

We have, and may in the future, enter into financing arrangements with certain VIEs to provide funding for potential capital expenditures including, but not limited to, the construction of dispensaries and other facilities. Our existing VIEs are, and may in the future be, owned by certain of our employees or their affiliates. We may enter into ~~management~~Management ~~service~~Service ~~agreements~~Agreements ~~(“MSAs”)~~ with these VIEs, which grant us the ability to make business operating decisions, manage and staff employees, determine product mix, and t direct allocation of cash. The ~~MSA~~Management Service Agreements may also allow us to limit distributions from the entity.

We consolidate VIEs with the Company for financial reporting purposes. If we were to hold such entities directly, we would be able to exercise our rights as an equity holder directly to effect changes in the boards, managers or employees of those entities, which could affect changes at the management and operational level. In contrast, under our current contractual arrangements with these VIEs, we may not be able to directly change the members of the boards, managers or employees of these entities and would have to rely on the entities and the entities’ equity holders to perform their obligations in order to exercise our control over the entities. If any of these affiliated entities or their equity holders fail to perform their respective obligations under the contractual arrangements, we may have to incur substantial costs and expend additional resources to enforce such arrangements.

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Risks Related to our Business and Operations – The Cannabis Industry

If we are unable to compete effectively with current and potential participants in the cannabis industry and the illicit and psychoactive hemp-based markets, or if competition with current and potential market participants results in pricing pressure on our products, our business, financial condition and results of operations will be adversely impacted.

The U.S. cannabis industry is, and is expected to continue to be, competitive. A number of other companies engage in, and may in the future engage in, cannabis-related businesses, operate businesses in competition with us, purchase businesses and assets and/or make investments that we will also seek to purchase or make. This competition may increase the price we must pay for acquisitions, make it more difficult for us to acquire licenses and purchase additional businesses and assets and put pricing pressure on our products, making it more difficult to operate at a profit. The inability to operate at a profit and acquire licenses, businesses and assets on terms favorable to us may adversely impact the revenue stream, geographic footprint and growth that we anticipate achieving.

Large conglomerates and companies who also recognize the potential for financial success through acquisitions and investment in the cannabis industry could strategically purchase or assume control of dispensaries and cultivation and production facilities in the states in which we operate or plan to operate. In doing so, these larger competitors could establish price setting and cost controls which would effectively “price out” many of the participants in the varied businesses operating in the cannabis industry. While the trend in most state laws and regulations seemingly deters this type of takeover, the industry in the U.S. is young and the future regulatory landscapes at both the state and federal level remain largely unknown.

We also face competition from the psychoactive hemp-based market and the illicit market, along with illegal dispensaries and cultivation operations that are unlicensed and unregulated, and that are selling cannabis products, including products with higher concentrations of active ingredients, and using delivery methods that we may be prohibited from offering due to laws and regulations. Any inability or unwillingness by law enforcement authorities to enforce existing laws prohibiting the unlicensed production and sale of cannabis and cannabis products could result in increased competition for us. Any or all these events could have a material adverse effect on our business, financial condition and results of operations.

Synthetic products may compete with cannabis and cannabis products resulting in increased competition and downward pressure on demand, volume and the profitability of our products, which could adversely affect our business, financial conditions and results of operations.

The pharmaceutical industry may attempt to compete with or dominate the cannabis industry through the development and distribution of synthetic products that emulate the effects and treatment of organic cannabis. If they are successful, the widespread popularity of such synthetic products could change the demand, volume and profitability of cannabis and cannabis related products. This competition could adversely affect our ability to secure long-term profitability and success through sustainable and profitable operations and could have a material adverse effect on our business, financial condition and results of operations.

We face risks due to industry immaturity and limited comparable, competitive or established industry best practices.

As a relatively new industry, there are not many established operators in the cannabis industry with business models we can follow or build upon. Similarly, there is limited information about comparable companies available to industry participants and potential investors to review in making business and investment decisions.

~~Shareholders~~Stockholders and investors should consider, among other factors, our prospects for success in light of the risks and uncertainties encountered by companies like us. For example, unanticipated expenses and problems or technical difficulties may occur, which may result in material delays in the expansion or operation of our business. We may fail to successfully address these risks and uncertainties or fail to successfully implement our operating strategies. If we fail to do so, it could materially harm our business to the point of having to cease operations and could impair the value of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ such that investors may lose their entire investments.

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We rely on third-party suppliers, manufacturers and contractors based in the U.S., and any significant interruption or negative change in the quality, availability, trade policy, pricing and other economics of these relationships could have a material adverse effect on our business, financial condition and results of operations.

The cultivation, extraction, production, sale and distribution of cannabis and cannabis products is dependent on a number of key inputs from third-party suppliers based in the U.S. and their related costs, including raw materials, electricity, water and other local utilities. Many of these inputs are provided by local suppliers, manufacturers and contractors operating in the same state or U.S. region as our operations, especially with respect to energy sources and other utilities. Some of these inputs may only be available from a single supplier or a limited group of suppliers. If a sole source supplier were to go out of business, fail to ship products in a timely manner, fail to produce products that meet our quality standards, have limited supply, become unwilling to do business with a cannabis business or substantially raise its prices, we might be unable to find a replacement for such source locally, regionally or anywhere within the U.S. in a cost-effective or timely manner or at all, which could materially and adversely impact our reputation and operations. Further, the rates charged for electricity and other energy sources may increase due to diminished supply, general economic conditions, rising inflation or general economic recessions, and the cost of raw materials and other components, natural gas and electricity may be adversely affected by geopolitical disruptions, such as ongoing conflicts between Russia and Ukraine and Israel and Hamas, changes in trade policies, including the imposition of new tariffs or increases in existing tariffs between the United States, Mexico, ~~Canada,~~ China or other countries, or reactionary measures including retaliatory tariffs, legal challenges, or currency manipulation, climate change and harvesting conditions. If our suppliers were to increase costs for any reason, we may need to increase costs to our end consumers, which may not be successful in offsetting cost pressures. Consumers may be less willing to pay a price differential for our branded products and may increasingly purchase lower-priced offerings from us or our competitors, or may forego some purchases altogether, particularly of our premium products, during an economic downturn or times of increased inflationary pressure.

We also rely on relationships with numerous business partners and third-party service providers located in the U.S ~~and in Canada~~. Unless and until the U.S. federal legal landscape with respect to cannabis changes, there is a significant risk that U.S. business partners and third party service providers may be required or otherwise decide to suspend, limit or withdraw services and business relationships to avoid prosecution by federal authorities under U.S. federal laws. Any inability to secure partners and required services or to do so on appropriate terms could have a material adverse effect on our business plans, financial condition and results of operations.

A drop in the wholesale or retail price of cannabis products in the geographic areas in which we operate would negatively impact our business, financial condition and results of operations.

The price and demand for our products is determined on a state-by-state basis and depends in part on the price and supply of commercially-grown cannabis in the particular state, and costs of cannabis are affected by various state regulations that limit the sourcing and procurement of cannabis products. Fluctuations in economic and market conditions and changes in regulations that impact the prices and supply of commercially grown cannabis, such as increases in the supply of cannabis and the decrease in the price of products using commercially grown cannabis, could cause increased competition and restrictions on selling products, resulting in our revenues and profitability declining, which would have a negative impact on our business, financial condition and results of operations.

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Inconsistent public opinion and perception of the medical and adult use cannabis industry may hinder market growth and state adoption of cannabis, which would adversely impact our growth plans and current operations and result in an adverse effect on our business, financial condition and results of operations.

Public opinion and support for medical and adult use cannabis has traditionally been inconsistent and varies from state to state. While public opinion and support appears to be rising generally in the U.S. for legalizing medical and adult use cannabis, it remains an issue subject to differing opinions surrounding the level of legalization (for example, medical cannabis only as opposed to legalization in general). Inconsistent public opinion and perception of medical and adult use cannabis hinders the growth of the cannabis industry and state adoption, which could have a material adverse effect on our business plans, financial condition and results of operations.

Our dependence upon consumer perceptions means that adverse scientific research reports, findings, regulatory proceedings, litigation, media attention or other publicity, regardless of accuracy or merit, could have a material adverse effect on us. Further, adverse publicity reports or other media attention regarding the safety, efficacy and quality of cannabis generally, or our products specifically, or associating the consumption of cannabis with illness or other negative effects or events, could have a material adverse effect on our sales and profits. Adverse publicity reports or other media attention could arise even if the adverse effects associated with such products resulted from consumers’ failure to consume the products appropriately or as directed.

The cannabis industry is subject to the risks inherent in an agricultural business, including environmental factors and the risk of crop failure. These risks could negatively impact our business, financial condition and results of operations.

The growing of cannabis is an agricultural process. As such, we are subject to the risks inherent in an agricultural business, including risks of climate change, crop failure and destruction presented by water scarcity, power failure, fires, insects, plant diseases and similar agricultural risks. These factors could have an adverse effect on our business, financial condition and results of operations.

We may be adversely impacted by rising or volatile energy costs and available supply.

Cannabis cultivation and processing consumes considerable energy, which makes us vulnerable to rising energy costs and available supply, including the price and availability of oil and natural gas. Accordingly, recent rising or volatile energy costs and supply disruptions caused by global supply constraints, inflation, limits on U.S. production and sanctions imposed on ~~Russian~~certain imports may adversely impact our business operations, financial condition and results of operations.

We face physical security risks. Any theft or other security event could lead to human injury and financial losses that would negatively affect our business, financial condition and results of operations. If a security breach resulted in substantial cannabis diversion, we could become a target for federal cannabis enforcement.

The business premises and assets of our operating locations are targets for theft. While we have implemented security measures at each of our locations and continue to monitor and seek to improve our security measures, our cultivation, production and dispensary facilities could be subject to break-ins, robberies and other breaches in security. If there was a breach in security and we fell victim to a robbery or theft, our employees or customers could be harmed and the loss of cannabis products, cultivation and production equipment or cash may be uninsured or underinsured, all of which could have a material adverse effect on our business, financial condition and results of operations. Furthermore, if such losses resulted in cannabis diversion, especially diversion to minors or across state lines, we could become a target for federal enforcement action, which could lead to criminal or civil sanctions that would materially impact our business, financial condition and results of operations.

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Risks Related to our Business and Operations – ~~United~~Government ~~States and Canadian~~ Regulation of Cannabis

As a British Columbia corporation with cannabis-related business activities, the Company may be subject to heightened scrutiny by Canadian authorities, which could negatively affect our business, financial condition and results of operations.

The business, operations and investments of the Company in the U.S., and any future businesses, operations and investments, may become the subject of heightened scrutiny by regulators, stock exchanges and other authorities in Canada. As a result, we may be subject to significant direct and indirect interaction with Canadian public officials. There can be no assurance that this heightened scrutiny will not in turn lead to the imposition of restrictions on our ability to invest or hold interests in other entities in the U.S. or any other jurisdiction.

The Canadian Securities Administrators’ Staff Notice 51-352 describes the Canadian Securities Administrators’ disclosure expectations for specific risks facing issuers with cannabis-related activities in the U.S. Staff Notice 51-352 confirms that a disclosure-based approach remains appropriate for Canadian issuers with U.S. cannabis-related activities, and includes additional disclosure expectations that apply to all Canadian issuers with U.S. cannabis-related activities, including those with direct and indirect involvement in the cultivation and distribution of cannabis, as well as Canadian issuers that provide goods and services to third parties involved in the U.S. cannabis industry.

The Canadian Depository for Securities Ltd. (“CDS”) is Canada’s central securities depository, clearing and settling trades in the Canadian equity, fixed income and money markets. CDS has signed a Memorandum of Understanding (the “TSX MOU”) with Aequitas NEO Exchange Inc. (now CBOE Canada Inc.), the CSE and the Toronto Stock Exchange confirming that it relies on such exchanges to review the conduct of listed issuers. Pursuant to the TSX MOU, CDS currently will not ban accepting deposits of or transactions for clearing and settlement of securities of Canadian issuers with cannabis-related activities in the U.S.

However, there can be no guarantee that the settlement of such securities will continue in the future. If CDS were to implement a ban, it would have a material adverse effect on the ability of holders of Subordinate Voting Shares to make and settle trades. In particular, the Subordinate Voting Shares would become highly illiquid until an alternative was implemented, and our shareholders would have no ability to effect a trade of the Subordinate Voting Shares through the facilities of a Canadian stock exchange.

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Disparate state-by-state regulatory landscapes and the constraints related to holding cannabis licenses in various states results in operational and legal structures that could have materially detrimental consequences to our business, financial condition and results of operations.

We realize, and will continue to realize, the benefits from cannabis licenses pursuant to several different operational and legal structures, depending on the regulatory requirements for specific states, including realizing the economic benefit of cannabis licenses through Management Service Agreements, which are often with third parties who hold the cannabis license. Management Service Agreements may be required to comply with applicable state laws and regulations or are in response to perceived risks that we determine warrants such arrangements.

The foregoing structures present various risks to us, including the following risks, each of which could have a material adverse effect on our business, financial condition and results of operations:

•A regulatory authority may determine that these Management Service Agreement structures are in violation of an existing legal or regulatory requirement or it may change the legal or regulatory requirements such that this contractual structure violates such changed requirements. We cannot provide assurance that a license application submitted by a third party for operations that would be governed by a Management Service Agreement will be approved or renewed.

•There could be a material and adverse impact on the revenue stream we intend to receive from a Management Service Agreement structure. If a Management Service Agreement is terminated, we will no longer receive any economic benefit from the applicable dispensary or cultivation license previously subject to the Management Service Agreement.

•These structures could potentially result in the funds invested by us for the development and operation of the business subject to the applicable license being used for unintended purposes, such as to fund litigation or damages from a contractual breach by the license holder.

•Under a Management Service Agreement structure, we will not be the holder of the applicable cannabis license, and therefore, we only would have contractual rights with respect to any interest in any such license. If the license holder fails to adhere to its contractual agreement with the us, or if the license holder makes, or fails to make, decisions in respect of the license that we disagree with, we will only have contractual recourse and will not have recourse to any regulatory authority.

•The license holder may renege on its obligation to pay fees and other compensation pursuant to a Management Service Agreement or violate other provisions of these agreements.

•The license holder’s acts or omissions may violate the applicable license, thus jeopardizing the status and economic value of the license holder and, by extension, us.

•The license holder may attempt to terminate the Management Service Agreement with us in violation of its express terms.

In any or all of the above situations, it would be difficult and expensive for us to protect our rights through litigation, arbitration or similar proceedings.

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Our business is subject to a variety of laws regarding financial transactions related to cannabis, which could subject us to legal claims or otherwise adversely affect our business, financial condition or results of operations.

We are subject to a variety of laws and regulations that prohibit money laundering, including the Money Laundering Control Act and any related or similar rules, regulations or guidelines issued, administered or enforced by governmental authorities in the U.S. or any other jurisdiction in which we have business operations. Financial institutions in the U.S. that we rely on are subject to the Bank Secrecy Act. The penalties for violation of these laws include imprisonment, substantial fines and forfeiture.

In 2014, the DOJ directed federal prosecutors to exercise restraint in prosecuting money laundering violations arising in the state legal cannabis programs and to consider the federal enforcement priorities enumerated in the Cole Memorandum when determining whether to charge institutions or individuals based upon cannabis-related activity. In the same year, the Treasury Department issued guidance that clarified how financial institutions can provide services to cannabis-related businesses, consistent with financial institutions’ obligations under the Bank Secrecy Act. Then Attorney General Sessions’ rescission of the DOJ’s guidance on the state cannabis programs increased uncertainty and heightened the risk that U.S. federal law enforcement authorities could seek to pursue money laundering charges against entities or individuals, engaged in supporting the U.S. cannabis industry. In January 2018, the Treasury Department issued additional guidance that the 2014 guidance would remain in place until further notice, despite the rescission of the DOJ’s earlier guidance memoranda. While proposed legislation such as the SAFE Banking Act, SAFER Banking Act and the CLIMB Act may make it easier for cannabis companies to access U.S. financial institutions, there is no guarantee that these acts will pass in the near future or at all, or that they will not significantly change prior to passing.

If any of our business activities, any dividends or distributions therefrom, or any profits or revenue accruing thereby are found to be in violation of money laundering statutes, we could be subject to criminal liability and significant penalties and fines. Any violations of these laws, or allegations of violations could disrupt our operations and involve significant management distraction and expenses. As a result, money laundering charges could materially and adversely affect our business, financial condition and results of operations. Additionally, proceeds from our business activities could be subject to seizure or forfeiture if they are found to be illegal proceeds of a crime transmitted in violation of anti-money laundering laws, which could have a material adverse effect on our business, financial condition and results of operations.

Compliance with regulations regarding cannabis is difficult and costly because the regulation of cannabis differs by jurisdiction, is uncertain and frequently changes. Compliance with applicable regulatory laws may be costly and take an extended period of time which may adversely affect our business, financial condition and financial results. If we fail to comply with applicable laws regarding cannabis, our business, financial condition and results of operations may be adversely affected.

Achievement of our business objectives is contingent, in part, upon our compliance with regulatory requirements enacted by governmental authorities and obtaining all regulatory approvals, where necessary, for the operation of our business and the sale of our products. We cannot predict the impact of the compliance regime regulatory bodies inwhere we operate (to the ~~U.S.~~extent ~~and~~we ~~Canada~~are subject to such regulations) are implementing or may implement that may affect our business. Similarly, we cannot predict the cost and time that will be required to secure or renew all appropriate regulatory licenses and approvals for the operation of our business or the sale of our products, or the cost and extent of testing, tracking, documentation, reporting and other compliance requirements that may be required by governmental authorities. The impact of governmental compliance regimes, the cost in obtaining and maintaining regulatory approvals and any delays in obtaining, or failure to obtain regulatory approvals may significantly delay or impact existing markets and the development of new markets, products and sales initiatives and could have a material adverse effect on our business plans, results of operations and financial condition.

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Recent and proposed state legislation throughout the U.S. has prioritized minority and diversity participation in the cannabis industry, including providing licensing preferences to minority owners, individuals with specified criminal convictions, local residents and individuals and businesses from economically depressed or disadvantaged areas. As new medical and adult use legislation is passed, multi-state operators such as us may be prevented, limited or discouraged from obtaining new licenses, renewing licenses or from participating in new markets or existing markets, or may be required to partner with specific individuals, who may be difficult to find and agree to terms with. Social equity initiatives could adversely impact our ability to increase or maintain market share and revenues in certain states, expand our geographic footprint or obtain a positive return on our acquisitions or investments, all of which could have a material adverse impact on our business, financial condition and results of operations. However, on January 20, 2025, President Trump issued an executive order ending certain federal diversity, equity and inclusion programs. While this order targets federal-level programs, its implementation has created significant uncertainty for state-level cannabis social equity initiatives that rely on federal administrative cooperation or grant funding. As such, we are uncertain whether the programs discussed above will continue in the cannabis industry. Furthermore, the legal landscape for state social equity programs has become increasingly volatile due to a split in federal appellate court rulings. While some circuits have upheld local residency preferences, others, including the Second Circuit in late 2025, have found that prioritizing in-state applicants is illegal. These conflicting rulings and subsequent lawsuits have led to significant delays and freezes in the issuance of new licenses in several of our core markets. We cannot predict whether these programs will be struck down, amended, or indefinitely delayed by litigation, which could disrupt our expansion timelines and increase our legal and compliance costs.

There is a risk of high bonding and insurance costs which could materially impact our business, financial condition and results of operations.

There is risk that some or all state and local regulatory agencies will require entities and individuals engaged in aspects of the cannabis business to post a bond and maintain specified levels of insurance when applying for a cannabis-related license or renewal as a guarantee of payment of sales and franchise tax. It remains an unknown cost that could have a negative impact on our ultimate success or our participation in the business opportunities ultimately selected.

Unknown additional or increased regulatory fees, required fundings and taxes may be assessed in the future, which could materially impact our business, financial condition and results of operations.

Various states and localities have imposed (or may in the future impose) licensing and other fees to fund, among other things, schools, road improvements, low-income and moderate-income housing and financing for social equity operators. Additionally, multiple states in the U.S. are considering, or may in the future consider, special taxes, funding requirements or increasing or adding fees on businesses in the cannabis industry, including substantial licensing fees. The imposition of additional taxes, required fundings or increased fees would adversely affect our operating results and expected returns on acquisitions, investments and business opportunities.

We are subject to environmental regulations, and future changes in environmental regulations could have a material adverse effect on our business, financial condition and results of operations.

Our operations are subject to environmental regulations in the various jurisdictions in which we operate. These regulations mandate, among other things, the maintenance of air and water quality standards, emissions standards and land reclamation. They also set forth limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Environmental legislation is evolving in a manner which will require stricter standards and enforcement, increased compliance costs, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects, and a heightened degree of responsibility for companies and their officers, directors and employees. There is no assurance that future changes in environmental regulation will not have a material adverse effect on our business, financial condition, and results of operations.

~~Our operating results may be adversely affected by changes in laws and policies governing employers and by union organizing activity.~~51

Congress and certain state legislatures continue to consider and pass legislation that increases our costs of doing business, including increased minimum wages and requiring employers to provide paid sick leave or paid family leave. In addition, our employee-related operating costs may be increased by union organizing activity and the National Labor Relations Board adopted regulatory changes that could facilitate union organizing. If we are unable to reflect these increased expenses in our pricing or otherwise modify our operations to mitigate the effects of such increases, our operating results will be adversely affected.

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Our operating results may be adversely affected by changes in laws and policies governing employers and by union organizing activity.

Congress and certain state legislatures continue to consider and pass legislation that increases our costs of doing business, including increased minimum wages and requiring employers to provide paid sick leave or paid family leave. In addition, our employee-related operating costs may be increased by union organizing activity, and the National Labor Relations Board adopted regulatory changes that could facilitate union organizing. If we are unable to reflect these increased expenses in our pricing or otherwise modify our operations to mitigate the effects of such increases, our operating results will be adversely affected.

Increased unionization efforts and labor shortages could increase our operating costs and disrupt our ability to maintain consistent production levels.

The cannabis industry is seeing a surge in organized labor activity, often incentivized by state Labor Peace Agreement requirements (e.g., in New Jersey). If a significant portion of our cultivation or retail workforce were to unionize, we could experience higher labor costs, more rigid work rules, and the potential for work stoppages or strikes. Furthermore, the specialized nature of cannabis cultivation requires skilled labor; an intensely competitive labor market may force us to increase wages and benefits beyond our current projections to retain talent, which would further squeeze our operating margins.

As an SEC Foreign Issuer in Canada with cannabis-related business activities, the Company may be subject to heightened scrutiny by Canadian authorities, which could negatively affect our business, financial condition and results of operations.

Because Verano is classified as an SEC Foreign Issuer in Canada, its business, operations and investments , and any future businesses, operations and investments, may become the subject of heightened scrutiny by regulators, stock exchanges and other authorities in Canada. As a result, we may be subject to significant direct and indirect interaction with Canadian public officials.

We may be required by regulatory authorities to divest licenses, which would adversely impact our business, financial condition and results of operations.

Some states in which we operate, or expect to operate, limit or may in the future limit, the number of licenses that can be held by one consolidated entity within that state. We may hold more than the prescribed number of licenses in a state, including after consummating an acquisition of a business that also holds licenses in the applicable state, and accordingly we may be required to divest licenses and related operations in order to comply with applicable regulations or in order to receive approval to consummate such acquisition. The required divestiture of licenses and related operations may result in us accepting sales prices below market value and the incurrence of divestiture costs and disruptions which could have a material adverse effect on our business, financial condition and results of operations.

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We are dependent on the banking industry, and we have difficulty accessing or consistently maintaining banking or other financial services due to the federal illegality of cannabis businesses, which could adversely impact our business, financial condition and results of operations.

Our participation in the cannabis industry limits our ability to do business or establish collaborative relationships with U.S. financial institutions that may fear disruption or increased regulatory scrutiny of their own activities.

We are dependent on the banking industry. Our business operating functions, including payroll for employees, equipment and property lease payments, and the payment of other vendor and operating expenses, are reliant on having access to traditional banking services. We require access to banking services to make and receive payments in a timely manner, and these could be jeopardized if we lose access to bank accounts. Most federal and federally insured banks currently do not serve cannabis businesses on the stated ground that growing and selling cannabis is illegal under federal law, even though the Treasury Department issued guidelines to banks in February 2014 that clarified how financial institutions can provide services to cannabis-related businesses, consistent with financial institutions’ obligations under the Bank Secrecy Act. When cannabis businesses are able to find a bank that will provide services, they face extensive customer due diligence in light of complex state regulatory requirements and guidance from the Treasury Department, and these reviews are time-consuming and costly, creating additional barriers to financial services for, and imposing additional compliance requirements on, us. While the U.S. federal government has generally not initiated financial crime prosecutions against state-law compliant cannabis companies or their vendors, the U.S. federal government theoretically could initiate such prosecutions, at least against companies in the adult use cannabis markets. The continued uncertainty surrounding financial transactions related to cannabis activities, including legislation such as the SAFE Banking Act, the SAFER Banking Act and the CLIMB Act, and the subsequent risks this uncertainty presents to U.S. financial institutions may result in their discontinuing services to the cannabis industry or limiting their ability to provide services to the cannabis industry or ancillary businesses providing services to the cannabis industry. Additionally, increased institutional interest in the cannabis sector may lead to more rigorous know your customer and anti-money laundering scrutiny from financial partners. If our internal controls are deemed insufficient to track source of funds or related-party transactions with the granularity required by major national banks, we may be denied access to the very banking services that rescheduling from Schedule I to Schedule III was intended to provide. This could result in a continued reliance on expensive, non-traditional financing.

We, our directors, officers, investors and other stakeholders may be required to disclose personal information to regulatory authorities. Failing to do so could put our licenses in jeopardy and negatively impact our business, financial condition and results of operations.

We own, operate, manage, and provide products or services to various U.S. state-licensed cannabis businesses. Acquiring even a minimal or indirect interest in a U.S. state-licensed cannabis business can trigger requirements to disclose directors’, officers’, investors’ and other stakeholders’ personal information to applicable regulatory authorities. While these requirements vary by jurisdiction, some require interest holders to personally apply for regulatory approval and to provide tax returns, compensation agreements, fingerprints for background checks, criminal history records and other personal documents and information. Some states require disclosures of directors, officers and holders of more than a specified percentage of equity of the applicant. While some states allow exceptions for investments in publicly traded companies like us, not all states do so, and some of these public company exceptions are limited to companies traded on a U.S. stock exchange, which we are not. If these regulations apply to us, our directors, investors, officers and other stakeholders are required to comply with the regulations or face the possibility that our relevant cannabis license could be revoked or cancelled by the state licensing authority.

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If one of our ~~shareholders~~stockholders is found unsuitable by one of our licensing authorities, we may seek to redeem such ~~shareholder~~stockholder’s ownership interests and we may be forced to use our cash or incur debt to fund such redemption of our securities. If we are unable to redeem our securities, such failure could result in the loss of current or potential cannabis licenses which would have an adverse effect on our revenues, financial performance and growth objectives.

We may seek to redeem our securities held by certain ~~shareholders~~stockholders in the event (i) a licensing authority has determined that the ~~shareholder~~stockholder is unsuitable to own securities of a cannabis licensee, or (ii) we have determined that the ~~shareholder~~stockholder’s ownership of our securities may result in the loss, suspension or revocation (or similar action) with respect to our cannabis licenses or in us being unable to obtain any new cannabis licenses, in each case including as a result of the evaluation of such person’s suitability review or such person otherwise failing to comply with the requirements of a licensing authority. Any redemption and the price of such redemption would be determined by our board of directors (the “Board”) and, if a license application has been filed, after consultation with the applicable licensing authority. Any redemption may be required to be made at a premium to the market value of such securities, and a redemption diverts our cash resources from other productive uses and may require us to obtain additional financing which may involve additional restrictive covenants and further leveraging of our assets. In the event we seek to redeem specified securities and are unable to do so, such failure may result in the loss of one or more current or potential cannabis licenses which would have an adverse effect on our revenues, financial performance, growth objectives and geographic diversity.

Our ~~directors~~employees, ~~officers,~~business ~~employees~~partners and investors may be subject to the risk of being barred from entry into the U.S. If our business partners, investors or personnel are barred from entering the United States, it could negatively impact our business, financial condition and results of operations.

Because cannabis remains illegal under U.S. federal law, non-U.S. citizens employed at, conducting business with or investing in U.S. state licensed cannabis businesses could face detention, denial of entry or lifetime bans from the U.S. for their associations with U.S. cannabis businesses. Entry happens at the sole discretion of the officers on duty of the U.S. Customs and Border Protection ~~(“U.S. Customs”),~~ and these officers have wide latitude to ask questions to determine the admissibility of a foreign national. The government of Canada has posted on its website that previous use of cannabis, or any substance prohibited by U.S. federal laws, could mean denial of entry into the U.S. Business or financial involvement in the legal cannabis industry in Canada or in the U.S. could also be reason enough for U.S. border guards to deny entry. On September 21, 2018, U.S. Customs released a statement outlining its current position with respect to enforcement of U.S. laws. It stated that Canada’s legalization of cannabis will not change U.S. Customs enforcement of U.S. federal laws regarding controlled substances and, because cannabis continues to be a controlled substance under U.S. federal law, working in or facilitating the proliferation of the cannabis industry in U.S. states where it is deemed legal, or in Canada, may affect admissibility into the U.S. As a result, U.S. Customs has affirmed that employees, directors, officers, managers and investors of businesses involved in activities related to cannabis in the U.S. or Canada who are not U.S. citizens face the risk of being barred from entry into the U.S. for life. On October 9, 2018, U.S. Customs released an additional statement regarding the admissibility of Canadian citizens working in the legal cannabis industry. U.S. Customs stated that a Canadian citizen working in or facilitating the proliferation of the legal cannabis industry in Canada coming into the U.S. for reasons unrelated to the cannabis industry will generally be admitted into the U.S.; however, if such person is found to be coming into the U.S. for reasons related to the cannabis industry, such person may be deemed inadmissible.

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Applicable state laws may prevent us from maximizing our potential income, including by restricting our sales and marketing activities. If our profits are constrained by such regulations, it could negatively impact our business, financial condition and results of operations.

The development of our business and operating results may be hindered by applicable restrictions on sales and marketing activities imposed by government regulatory bodies. The cannabis regulatory environment in the U.S. limits our ability to grow sales among existing customers and reach new customers in a manner similar to other industries. If we are unable to effectively market our products and compete for market share, or if the costs of compliance with government legislation and regulation cannot be absorbed through increased prices for our products, our sales and operating results could be adversely affected.

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Cannabis may become subject to increased regulation by the FDA or the Bureau of Alcohol, Tobacco, Firearms and Explosives (the “ATF”). If we are unable to comply with applicable regulations, it could have a material adverse effect on our business, financial condition and results of operations.

At this time, cannabis remains a Schedule I controlled substance under U.S. federal law. InOn ~~October~~December ~~2022~~18, 2025, President ~~Biden~~Trump ~~announced~~issued ~~that he was asking~~ the ~~Secretary~~Executive ofOrder, ~~HHS~~which ~~and~~directs ~~the~~federal ~~Attorney~~agencies ~~General~~ to ~~review~~expedite the ~~scheduling~~process of ~~cannabis~~rescheduling ~~under federal law. In August 2023, HHS recommended to the DEA that~~ cannabis ~~be rescheduled~~ from a Schedule I to a Schedule III ~~under~~controlled ~~the CSA~~substance. InThe ~~May~~effect ~~2024,~~of ~~the~~this ~~DEA~~executive ~~announced~~order ~~that~~would itlessen ~~was~~criminal ~~submitting~~penalties aat ~~notice of a proposed rulemaking to~~ the ~~Federal~~federal ~~Register,~~level and ~~hearings~~remove ~~for~~Section ~~the~~280E ~~formal~~tax ~~rulemaking process began in December 2024. On December 2~~considerations, ~~2024~~however, the ~~DEA~~final ~~held~~effects ~~a preliminary formal hearing regarding the rescheduling~~ of ~~cannabis,~~this ~~and~~executive ~~additional~~order ~~hearings~~are ~~were~~dependent ~~scheduled~~on ~~from~~other ~~January~~government ~~21, 2025 to March 6, 2025~~actions. OnThe ~~January~~Executive 13Order, ~~2025,~~and ~~Chief~~agency ~~Administrative~~implementation ~~Law Judge presiding over the rescheduling~~ of ~~cannabis ordered that~~ the ~~hearing~~Executive ~~scheduled~~Order ~~for~~does ~~January~~not ~~21,~~federally ~~2025~~legalize ~~was~~adult ~~cancelled,~~use and ~~that~~would ~~the~~not ~~proceedings~~federally inauthorize ~~the~~or ~~matter~~approve ~~were~~state ~~stayed,~~sanctioned ~~pending~~medical aprograms. ~~resolution~~Cannabis ofwould anstill ~~interlocutory~~be ~~appeal~~subject to the ~~DEA~~same ~~Administrator.~~FDA Adrug ~~joint~~approval ~~status~~process ~~update~~as ~~must~~all beother ~~provided~~substances, toand ~~the~~sales ~~tribunal~~outside ~~ninety (90) days from the issuance~~ of ~~the~~FDA ~~order~~approval, ~~and~~would ~~every~~still ~~ninety~~be ~~(90)~~criminal ~~days~~at ~~thereafter~~the federal level.

Additionally, the FDA may issue rules and regulations, including good manufacturing practices, related to the growth, cultivation, harvesting and processing of cannabis. Clinical trials may be needed to verify the efficacy and safety of cannabis products. It is also possible that the FDA would require facilities that grow medical-use cannabis to register with the FDA and comply with federally prescribed regulations. In the event that some or all of these regulations are imposed, the impact on the cannabis industry is unknown, including what costs, requirements and possible prohibitions may be enforced. If we become subject to these enhanced regulations prescribed by the FDA and are unable to comply, it may have a material adverse effect on our business, financial condition and results of operations.

It is also possible that the federal government could seek to regulate cannabis under the ATF. The ATF may issue rules and regulations related to the use, transporting, sale and advertising of cannabis or cannabis products, including smokeless cannabis products.

Because cannabis is illegal at the U.S. federal level, we may be unable to enforce our contracts, which could negatively impact our business, financial condition and results of operations.

Judges in multiple U.S. states have on several occasions refused to enforce contracts for the repayment of money when the loan was used in connection with activities that violate federal law, even if there is no violation of state law. Therefore, there is uncertainty that we will be able to legally enforce our agreements through U.S. legal proceedings because cannabis is illegal at the U.S. federal level.

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Because states may not allow or enforce the pledge of cannabis assets as collateral, we may not be able to obtain financing or obtain better terms of financing on a secured basis or enforce any liens we may be granted on the inventory or licenses of third parties that secure our payment and other rights.

In general, the laws of the states that have legalized the sale and cultivation of cannabis do not expressly or impliedly allow for the pledge of cannabis inventory as collateral for the benefit of third parties that do not possess the requisite licenses and entitlements to cultivate, sell or possess cannabis pursuant to the applicable state law. Likewise, the laws of those states generally do not allow for the transfer of licenses and entitlements to sell or produce cannabis products to third parties that were not directly granted such licenses and entitlements by the applicable state agency. The inability to enforce liens on cannabis inventory and licenses that secure the payment of debt and other contractual rights increases the risk of loss resulting from breaches of the applicable agreements by the contracting parties, which, in turn, could have a material adverse effect on our ability to obtain secured financing, or obtain better terms on financing, or secure any loans or advances we make to third parties in the cannabis industry.

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Because cannabis is illegal under U.S. federal law, we may lack access to U.S. bankruptcy protections, which could negatively impact our business, financial condition and results of operations.

Because the use of cannabis is illegal under U.S. federal law, certain U.S. federal courts have denied cannabis businesses bankruptcy protections, thus making it difficult for lenders and investors to quantify the risk of being able to recoup their investments in the cannabis industry in the event of an insolvency. If we were to become insolvent, there is no guarantee that U.S. federal bankruptcy protections would be available, the unavailability of which would have a material adverse effect on any restructuring transaction.

Additionally, there is no guarantee that we will be able to effectively enforce any interests we may have in our subsidiaries, affiliates and investments. A bankruptcy or other similar insolvency event of an entity in which we hold an interest that precludes such entity from performing its obligations owed to us under an agreement may have a material adverse effect on our business, financial condition and results of operations. Further, should an entity in which we hold an interest have insufficient assets to pay its liabilities, it is possible that other liabilities will be satisfied prior to the liabilities or equity owed to us. In addition, bankruptcy or other similar insolvency proceedings are often a complex and lengthy process, the outcome of which may be uncertain and could result in a material adverse effect on our business, financial condition and results of operations.

Also, some state cannabis laws preclude entities which become insolvent from holding medical or adult use cannabis licenses. Any insolvency proceedings by the Company could therefore put the operations of our subsidiaries or affiliates at risk, which would have a negative impact on theirs and our consolidated business, financial condition and results of operations.

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Risks Related to our Business and Operations – Information Technology, Cybersecurity and Intellectual Property

We are subject to risks related to our information technology systems, including cyber-security risks. Successful cyber-attacks or technological malfunctions can result in, among other things, financial losses, the inability to process transactions, the unauthorized release of confidential information and reputational risk, all which would negatively impact our business, financial condition and results of operations.

Our use of technology is critical to our continued operations. We are susceptible to operational, financial and information security risks resulting from cyber-attacks or technological malfunctions. Successful cyber-attacks or technological malfunctions affecting us or our respective service providers can result in, among other things, financial losses, the inability to process transactions, the unauthorized release of customer information or other confidential information and reputational risk. Depending on the severity of a potential cybersecurity incident, our customers’ data, our employees’ data, our intellectual property (including trade secrets and research and development), and other third-party data (such as suppliers and vendors) could be compromised, which could adversely affect our business. As cybersecurity threats continue to evolve, we may be required to use additional resources to continue to modify or enhance protective measures or to investigate security vulnerabilities, which could have a material adverse effect on our business, financial condition and results of operations. Traditional cybersecurity defenses may be insufficient against AI-enhanced threats. We have seen a global rise in cyber-enabled fraud, where bad actors use AI to impersonate executives or vendors to authorize fraudulent wire transfers. As a cannabis operator handling significant cash-equivalent transactions and sensitive patient health data, a breach could lead to severe regulatory fines, loss of licensure, and irreparable brand damage. Our reliance on third-party seed-to-sale software also introduces concentration risk, where a single vulnerability in a common vendor could halt operations across multiple states simultaneously.

In connection with our products and services, we may receive, process, store and transmit sensitive business information and, in certain circumstances, personal medical and other information. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data, including any personal information, we could incur liability and reputational damage and could be subject to civil fines and penalties, including under the Health Insurance Portability and Accountability Act of 1966 (“HIPAA”), and other relevant state and federal privacy laws in the U.S.

Our increasing use of, or failure to effectively implement, artificial intelligence (AI) and automated systems could lead to operational disruptions, data inaccuracies, or legal liabilities.

We are exploring and integrating AI technologies into our cultivation monitoring, supply chain forecasting, and retail customer engagement platforms. These technologies are complex and rapidly evolving. If the algorithms we use are flawed, or if the data used to train them is biased or inaccurate, it could lead to suboptimal cultivation yields, inventory imbalances, or discriminatory marketing practices. Furthermore, the use of generative AI by our employees or third-party vendors could result in the unintended disclosure of trade secrets or intellectual property. The regulatory landscape for AI is nascent; new laws may impose costly compliance requirements or restrict our ability to use certain automated tools for hiring or customer profiling.

We rely on third-parties to provide numerous capabilities that we depend upon on to operate, and a disruption of these systems could adversely affect our business.

We are dependent on vendors and third-party software providers, such as our seed-to-sale tracking software providers and point of sale transaction processing providers to operate our business. A serious disruption to any of these could significantly limit our ability to serve our customers and operate profitably. The failure of one or more such providers to provide the expected services, provide them on a timely basis or provide them at the prices we expect, or otherwise meet our performance standards and expectations (including with respect to data security, compliance and data privacy and protection laws) may adversely affect our business. Further, if we found it necessary to replace any such service provider, disruptions arising from the transition of functions to an alternative provider, or the costs developing our own software if we were unable to find an alternate provider, may have a material adverse effect on our results of operations or financial condition. Any disruption could cause our business and competitive position to suffer and cause our operating results to be reduced.

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Strong brand identities are important to our success, and we may have to incur significant expenses to maintain our brand identities. If we are unable to protect our brands or if the cost is excessive, it could negatively affect our business, financial condition and results of operations.

We believe that establishing and maintaining the brand identities of our ~~national~~ retail ~~chain~~dispensaries and products are critical aspects of attracting, expanding and keeping a large customer base. Promotion and enhancement of brands will depend largely on our success in operating our dispensaries and providing high-quality products. If customers and patients do not perceive our retail operations and products to be consistently be of high quality and value, or if we introduce new products, change products or enter into new business ventures that are not favorably received by customers and patients, we risk diluting our brand identities and decreasing their attractiveness to existing and potential customers. Moreover, in order to attract and retain customers and to promote and maintain brand equity in response to competitive pressures, we may have to substantially increase our financial commitment to creating and maintaining distinct brand loyalty among customers. We may incur significant expenses in an attempt to promote and maintain our brands, and if such efforts are not successful it could have a material adverse effect on our business, financial condition and results of operations.

We are reliant on intellectual property rights. If we fail to protect our intellectual property it could negatively affect our business, financial condition and results of operations.

Our success will depend in part on our ability to use and develop new extraction technologies, recipes, formulations, know-how and novel cannabis genetics. We may be vulnerable to competitors who develop competing technology, whether independently or as a result of acquiring access to the proprietary products and trade secrets of acquired businesses. In addition, effective future patent, copyright and trade secret protection may be diminished or limited based on significant innovation and advances within the market. If we fail to adequately maintain and enhance protection over our proprietary techniques and processes, as well as over our unregistered intellectual property, including our policies, procedures and training manuals, it could have a material adverse effect on our business, financial condition and results of operations.

There is limited trademark protection for cannabis products. If we are unable to protect our trademarks, it could negatively affect our business, financial condition and results of operations.

Because producing, manufacturing, processing, possessing, distributing, selling and using cannabis is illegal under the Controlled Substances Act, the United States Patent and Trademark Office will not permit the registration of any trademark that identifies cannabis products. As a result, we likely will be unable to protect our cannabis related trademarks beyond the geographic areas in which we conduct business. The use of our trademarks outside the states in which we operate by one or more other persons could have a material adverse effect on the value of our trademarks and as a result, on our business, financial condition and results of operations.

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Our trade secrets may be difficult to protect. Our failure to maintain meaningful trade secret protection could adversely affect our competitive position and our business, financial condition and results of operations.

Our success depends upon the skills, knowledge, and experience of our scientific and technical personnel, our consultants and advisors, as well as our contractors. Because we operate in a highly competitive industry, we rely in part on trade secrets to protect our proprietary technologies and processes. However, trade secrets are difficult and costly to protect. We enter into business protection, confidentiality and non-disclosure agreements with our partners, employees, consultants, outside scientific collaborators, developers and other advisors. These agreements generally require that the receiving party will keep confidential and not disclose to third parties our confidential information developed by the receiving party or made known to the receiving party by us during the course of the receiving party’s relationship with us. These agreements also generally provide that inventions conceived by the receiving party in the course of rendering services to us will be our exclusive property. In addition, we enter into assignment agreements to further perfect our rights in our intellectual property, including trade secrets, inventions, work product and confidential information.

These confidentiality, inventions, assignment and business protection agreements may be breached and may not effectively assign intellectual property rights to us. Our trade secrets also could be independently discovered or reverse engineered by competitors, in which case we would not be able to prevent the use of such trade secrets by our competitors. The enforcement of a claim alleging that a party illegally obtained and was using our trade secrets could be difficult, expensive and time consuming and the outcome would be unpredictable. In addition, courts may be less willing to protect trade secrets related to cannabis activities. The failure to obtain or maintain meaningful trade secret protection could adversely affect our competitive position.

We may be exposed to infringement or misappropriation claims by third parties, which, if determined adversely to us, could subject us to significant liabilities and other costs, negatively impacting our business, financial condition and results of operations.

Our success will depend in part on our ability to use and develop new extraction technologies, recipes, know-how and new strains of cannabis without infringing the intellectual property rights of third parties. We cannot assure that third parties will not assert intellectual property claims against us or companies we acquire. We are subject to additional risks if entities licensing intellectual property to us do not have adequate rights in the licensed materials. If third parties assert trademark, copyright or patent infringement or violation of other intellectual property rights against us or companies we acquire, we will be required to defend ourselves in litigation or administrative proceedings, which can be both costly and time consuming and may significantly divert the efforts and resources of our personnel. An adverse determination in any such litigation or proceeding to which we may become a party could subject us to significant liability to third parties, require us to seek licenses from third parties or pay ongoing royalties or subject us to injunctions prohibiting the development and operation of our applications.

Our business may be adversely affected by an increasing prevalence of fraud and other financial crimes.

We are susceptible to fraudulent activity that may be committed against us or our customers which may result in financial losses or increased costs to us or our customers, disclosure or misuse of our information or our customers' information, misappropriation of assets, privacy breaches against our customers, litigation or damage to our reputation. Such fraudulent activity may take many forms, including check fraud, electronic fraud, wire fraud, phishing, social engineering and other dishonest acts. Nationally, reported incidents of fraud and other financial crimes have increased year-over-year. We have also experienced losses due to apparent fraud and other financial crimes. While we have policies and procedures designed to prevent such losses, there can be no assurance that such losses will not occur.

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Risks Related to our Securities, Internal Controls and Governance

We may be unable to realize the anticipated benefits of the Continuance, or we may be unable to do so within the anticipated timeframe.

On November 3, 2025, we completed the Continuance from British Columbia to the State of Nevada. While we believe this move will enhance shareholder value by reducing administrative costs and providing greater corporate flexibility, these benefits may not be fully realized, or we may be unable to realize the benefits within the anticipated timeframe. Our expectations are based on several assumptions that could prove incorrect, leading to the following risks, among others:

•The laws of the State of Nevada differ in material respects from the British Columbia Business Corporations Act. Nevada law provides broader discretion and greater protection for directors and officers against personal liability, which may be perceived by shareholders as a reduction in their ability to hold management accountable. These differences in corporate governance may lead to shareholder dissatisfaction or litigation, which could be costly and time-consuming to defend.

•The integration of our corporate identity into the Nevada legal framework requires significant management time and focus. If our leadership is diverted from our core business strategy to manage the administrative and legal complexities of the Continuance, our operational results could suffer. Furthermore, if we fail to update our internal controls and procedures to meet Nevada’s specific regulatory environment in a timely manner, we could face compliance failures.

If we are unable to realize the anticipated benefits of the Continuance within the expected timeframe, or at all, it could have a material adverse effect on our business, financial condition, and the market price of our Common Stock

A return on our securities is not guaranteed.

There is no guarantee that our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ will earn any positive return in the short or long term. A holding of ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ is speculative, involves a high degree of risk and should be undertaken only by holders whose financial resources are sufficient to enable them to assume such risks and who have no need for immediate liquidity in their investment. An investment in ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ is appropriate only for investors who have the capacity to absorb a loss of some or all of their investment.

The elimination of ~~monetary~~individual liability against our directors and officers under ~~British~~Nevada ~~Columbia~~ law and the existence of indemnification rights for our directors and officers may result in substantial expenditures by us and may discourage ~~us from bringing~~ claims for wrongful acts against our directors and officers, which could negatively impact our business, financial condition and results of operations.

Our ~~corporate~~ articles of incorporation contain a provision permitting the elimination of personal liability of our directors and officers to us and our ~~shareholders~~stockholders for damages caused by a director or officer to the extent provided for under ~~British~~Nevada ~~Columbia~~ law. We may also incur contractual indemnification obligations under employment agreements with our officers or agreements entered into with our directors. These indemnification obligations could result in us incurring substantial expenditures to cover the cost of settlement or damage awards against our directors and officers, which may be uninsured or underinsured and for which we may be unable to recoup. These agreements and the resulting costs may also discourage us from bringing a lawsuit against directors and officers for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our ~~shareholders~~stockholders against our directors and officers even though such actions, if successful, might otherwise benefit us and our ~~shareholders~~stockholders.

Our capital structure may negatively impact the trading price of the Subordinate Voting Shares, which could adversely affect the trading volume and liquidity of the Subordinate Voting Shares and our ability to attract investors and raise funds through equity issuances.60

Although many other Canadian companies have dual class or multiple class share structures and we currently do not have any Proportionate Voting Shares outstanding, our dual class capital structure, with each Proportionate Voting Shares being convertible into 100 Subordinate Voting Shares, could result in a lower trading price for, or greater fluctuations in, the trading price, volume and liquidity of the Subordinate Voting Shares. This could impair our ability to issue Subordinate Voting Shares as consideration in our acquisitions, raise additional capital through the sale of securities, attract investors and could have other adverse consequences.

The Company is a public issuer in both the U.S. and Canada. The Board and management must devote time and resources to compliance initiatives, corporate governance practices and securities rules and regulations that impose various requirements on both Canadian and U.S. public companies. These additional costs and management attention could negatively impact our business, financial condition and results of operations.

As a public issuer in Canada, the Company is subject to the reporting requirements and rules and regulations under Canadian securities laws and the rules of Cboe. As a public issuer in the U.S., the Company is also subject to the rules and regulations of the SEC and the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Application of both existing or new U.S. or Canadian regulatory requirements may have adverse consequences on our ability to issue securities to acquire companies or to raise capital in private placements or prospectus offerings.

As a public company, there are costs associated with legal, accounting and other expenses related to regulatory compliance in Canada as well as compliance with the U.S. Securities legislation and the rules and policies of Canadian Securities Administrators, Cboe and the SEC require reporting and listed companies to, among other things, adopt corporate governance and related practices, and to continuously prepare and disclose material information, all of which add to a company’s legal and financial compliance costs. Complying with these U.S. and Canadian statutes, regulations and requirements, particularly now that we no longer qualify as an Emerging Growth Company under U.S. securities laws, occupies a significant amount of time of the Board and management.

Shareholder activism, the political environment and a high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which could then result in additional compliance costs and affect the manner in which we operate our business. We also devote greater resources than a non-reporting company otherwise would to communications and other activities involving shareholders, investors and analysts which are typically considered important for publicly traded companies. Any new regulations or disclosure obligations or additional shareholder communications and activities may increase our legal and financial compliance costs and may make some compliance activities more time-consuming and costly.

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Our ~~management~~organizational ~~must~~documents ~~devote~~contain ~~substantial~~provisions ~~time~~that ~~and~~may ~~cost~~prevent totransactions ~~the~~that establishment, modification and maintenance of effective internal controls required by Section 404(a) of the Sarbanes-Oxley Act of 2002 (“SOX”). These requirements take time and resources and increase our legal and financial compliance costs. If we are unable to maintain effective internal controls, our ability to produce timely and accurate financial statements could be ~~impaired,~~beneficial ~~investors~~to ~~could lose confidence in~~ our ~~financial~~stockholders ~~information~~ and ~~the~~may ~~price~~insulate of our ~~Subordinate~~management ~~Voting~~from ~~Shares could decline~~removal.

~~As a U.S. and Canadian reporting company, we are required to maintain effective disclosure controls and procedures and internal controls over financial reporting.~~ Our ~~management~~articles is required to furnish a report on our internal controls over financial reporting in our Annual Reports on Form 10-K. In addition, our independent registered public accounting firm is required, pursuant to Section 404(b) of ~~SOX,~~incorporation ~~to attest to the effectiveness of our internal control over financial reporting~~ and ~~we are required to include such attestation in our Annual Reports on Form 10-K.~~bylaws:

•require certain procedures to be followed and time periods to be met for any stockholder to propose matters to be considered at annual or special meetings of stockholders, including nominating directors for election at those meetings; and

•authorize our Board to issue up to 1,000,000,000 shares of preferred stock (the “Preferred Stock”) without stockholder approval and to set the rights, preferences and other designations, including voting rights, of those shares as the Board may determine.

In addition, we may be subject to the provisions of certain Nevada statutes that could have the effect of prohibiting or limiting certain transactions with our stockholders or discouraging acquisitions of our capital stock

Nevada’s “combinations with interested stockholders” statutes (Sections 78.411 through 78.444, inclusive, of the Nevada Revised Statutes, or NRS) provide that specified types of business “combinations” between certain Nevada corporations and any person deemed to be an “interested stockholder” of the corporation are prohibited for two years after such person first becomes an “interested stockholder” unless the corporation’s board of directors approves the combination (or the transaction by which such person becomes an “interested stockholder”) in advance, or unless the combination is approved by the board of directors and 60% of the corporation’s voting power not beneficially owned by the interested stockholder, its affiliates and associates. Furthermore, in the absence of prior approval certain restrictions may apply even after such two-year period. For purposes of these statutes, an “interested stockholder” is any person who is (1) the beneficial owner, directly or indirectly, of 10% or more of the voting power of the outstanding voting shares of the corporation, or (2) an affiliate or associate of the corporation and at any time within the two previous years was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then-outstanding shares of the corporation. The definition of the term “combination” is sufficiently broad to cover most significant transactions between a corporation and an “interested stockholder.” These statutes generally apply to Nevada corporations with 200 or more stockholders of record. However, a Nevada corporation may elect in its articles of incorporation not to be governed by these particular laws, but if such election is not made in the corporation’s original articles of incorporation, the amendment (1) must be approved by the affirmative vote of the holders of stock representing a majority of the outstanding voting power of the corporation not beneficially owned by interested stockholders or their affiliates and associates, and (2) is not effective until 18 months after the vote approving the amendment and does not apply to any combination with a person who first became an interested stockholder on or before the effective date of the amendment. We have made such an opt-out election in our articles of incorporation.

Nevada’s “acquisition of controlling interest” statutes (NRS 78.378 to 78.3793, inclusive) prohibit an acquirer, under certain circumstances, from voting its shares of a target corporation’s stock after crossing certain ownership threshold percentages, unless the acquirer obtains approval of the target corporation’s disinterested stockholders. The statute specifies three thresholds: one-fifth or more but less than one-third, one-third but less than a majority, and a majority or more, of the outstanding voting power. Generally, once an acquirer crosses one of the above thresholds, those shares in an offer or acquisition and acquired within 90 days thereof become “control shares” and such control shares are deprived of the right to vote until disinterested stockholders restore the right. These provisions also provide that if control shares are accorded full voting rights and the acquiring person has acquired a majority or more of all voting power, all other stockholders who do not vote in favor of authorizing voting rights to the control shares are entitled to demand payment for the fair value of their shares in accordance with Nevada’s dissenter’s rights statutes. A corporation may elect to not be governed by, or “opt out” of, the control share provisions by making an election in its articles of incorporation or bylaws, provided that the opt-out election must be in place on the 10th day following the date an acquiring person has acquired a controlling interest, that is, crossing any of the three thresholds described above. We have opted out of the control share statutes in our bylaws.

These provisions of our organizational documents and the NRS, alone or in combination with each other, may discourage transactions involving actual or potential changes of control, including transactions that otherwise could involve payment of a premium over prevailing market prices to holders of common stock, could limit the ability of stockholders to approve transactions that they may deem to be in their best interests, and could make it considerably more difficult for a potential acquirer to replace management.

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The Company is a public issuer in the U.S. and is classified as an SEC Foreign Issuer in Canada. The Board and management must devote time and resources to compliance initiatives, corporate governance practices and securities rules and regulations that impose various requirements on public companies. These additional costs and management attention could negatively impact our business, financial condition and results of operations.

As a public issuer in the U.S., the Company is subject to the rules and regulations of the SEC and the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). As an SEC Foreign Issuer in Canada with the Common Stock listed on Cboe, the Company is also subject to certain reporting requirements and rules and regulations under Canadian securities laws and the rules of Cboe. Application of both existing or new U.S. or Canadian regulatory requirements applicable to us may have adverse consequences on our ability to issue securities to acquire companies or to raise capital in private placements or prospectus offerings.

As a public company, there are costs associated with legal, accounting and other expenses related to regulatory and stock exchange listing compliance in the U.S. as well as in Canada. Securities legislation and the rules and policies of the SEC, Canadian Securities Administrators and Cboe require reporting and listed companies to, among other things, adopt corporate governance and related practices, and to continuously prepare and disclose material information, all of which add to a company’s legal and financial compliance costs. Complying with these U.S. and applicable Canadian statutes, regulations and requirements has historically occupied a significant amount of time of the Board and management.

Stockholder activism, the political environment and a high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which could then result in additional compliance costs and affect the manner in which we operate our business. We also devote greater resources than a non-reporting company otherwise would to communications and other activities involving stockholders, investors and analysts which are typically considered important for publicly traded companies. Any new regulations or disclosure obligations or additional stockholder communications and activities may increase our legal and financial compliance costs and may make some compliance activities more time-consuming and costly.

Our management must devote substantial time and cost to effective internal controls required by Section 404(a) of the Sarbanes-Oxley Act of 2002 (“SOX”). These requirements take time and resources and increase our legal and financial compliance costs. If we are unable to maintain effective internal controls, our ability to produce timely and accurate financial statements could be impaired, investors could lose confidence in our financial information and the price of our Common Stock could decline.

As a U.S. reporting company and an SEC Foreign Issuer in Canada, we are required to maintain effective disclosure controls and procedures and internal controls over financial reporting. Our management is required to furnish a report on our internal controls over financial reporting in our Annual Reports on Form 10-K. In addition, our independent registered public accounting firm is required, pursuant to Section 404(b) of SOX, to attest to the effectiveness of our internal control over financial reporting and we are required to include such attestation in our Annual Reports on Form 10-K.

We have incurred significant costs related to maintaining our internal controls over financial reporting, and cannot predict or estimate the amount of time resources and additional costs we may incur or the impact and timing of such use of resources and costs. We may encounter problems or delays in implementing any changes necessary to make a favorable assessment of our internal controls over financial reporting.

Any testing by us conducted in connection with Section 404 of SOX, ~~have in the past, and~~ may ~~in the future~~ reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses that may require prospective or retrospective changes to our consolidated financial statements, or identify other areas for further attention or improvement. Inferior internal controls could impair our ability to produce timely and accurate financial statements and cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our ~~Subordinate~~Common ~~Voting Shares~~Stock.

Despite the efforts we have undertaken, ~~we have in the past concluded, and~~ there is a risk in the future that we will not be able to conclude, within the prescribed time frame or at all, that our internal control over financial reporting is effective as required by Section 404 of SOX. If within the prescribed time frame, ~~in the future~~ we cannot favorably assess the effectiveness of our internal control over financial reporting, or if our independent registered public accounting firm is unable to provide an unqualified attestation report on our internal controls, investors could lose confidence in our financial information and the price of our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ could decline.

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Additional issuances of ~~Subordinate~~Common ~~Voting Shares and Proportionate Voting Shares~~Stock, or securities convertible into ~~such~~Common ~~classes of shares~~Stock, may result in voting and economic dilution to our ~~shareholders~~stockholders.

We plan to issue additional securities in the future in connection with acquisitions, equity ~~incentive plans~~incentives, securities offerings and financing transactions (including through the sale of securities convertible into or exchangeable or exercisable for shares of our capital stock), which will dilute our ~~shareholders~~stockholders’ holdings in the Company. Our ~~corporate~~ articles of incorporation permit the issuance of an5,000,000,000 ~~unlimited~~shares ~~number~~ of ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ and an1,000,000,000 ~~unlimited~~shares ~~number~~ of ~~Proportionate~~Preferred ~~Voting Shares~~Stock, and our ~~shareholders~~stockholders have no pre-emptive rights in connection with any further issuances. The Board has discretion to determine the price and the terms of further issuances, and such terms could include rights, preferences, and privileges superior to those of our existing outstanding securities. We cannot predict the size or nature of future issuances or the effect that future issuances and sales of our securities will have on the market price of ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock. Issuances of a substantial number of additional securities by us, or the perception that such issuances could occur, may adversely affect the prevailing market ~~prices~~price ~~for~~of ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock. With any additional issuance of our securities, investors will suffer dilution to their voting power and we may experience dilution in our revenue and earnings per share.

Sales of substantial amounts of ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ in the public market or the perception that such substantial sales may occur may have an adverse effect on the market price of ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock.

Sales of a substantial number of ~~Subordinate~~shares ~~Voting~~of ~~Shares~~our Common Stock in the public market could occur at any time ~~either~~ by existing holders of ~~Subordinate~~Common ~~Voting Shares or by holders of Proportionate Voting Shares that are converted into Subordinate Voting Shares~~Stock. These sales, or the market perception that ~~shareholders~~stockholders intend to sell a large number of shares ~~Subordinate~~of ~~Voting~~Common ~~Shares~~Stock, could reduce the market price of ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock. If this occurs and continues, it could impair our ability to issue ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ as consideration in our acquisitions, raise additional capital through the sale of securities, and attract investors, along with other adverse consequences.

Upon issuance, transfer restrictions under securities laws or contractual terms may apply to ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock. When transfer restrictions expire or are otherwise lifted, the holders of the unrestricted ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ may seek to sell the shares in the public markets, and the increase in the volume of available ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ for sale may have an adverse effect on the market price of ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock.

When issued, ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ may be subject to restrictions on transfer under applicable securities laws or contractual terms. In anticipation of and following the expiration or lifting of these transfer restrictions, the sales price of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ may experience a decline due to additional ~~Subordinate~~shares ~~Voting~~of ~~Shares~~Common Stock being available for sale on the public markets. The sale of a significant amount of ~~Subordinate~~shares ~~Voting~~of ~~Shares~~Common Stock by existing ~~shareholders~~stockholders or the perception by investors that such sales may occur, could adversely affect the prevailing market price for ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock.

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~~The~~Our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~is ~~are~~ subject to price volatility.

The market price for ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ may be volatile and subject to wide fluctuations in response to numerous factors, many of which will be beyond our control, including the following:

•actual or anticipated fluctuations in our annual and quarterly results of operations;

•operating and financial performance that varies from the expectations of management, securities analysts and investors;

•changes or anticipated changes in U.S. federal cannabis regulations, including the rescheduling of cannabis as a controlled substance and the ability of cannabis companies to access banking services;

•changes or anticipated changes in state cannabis regulations affecting our business and operations;

•the public announcement of pending or consummated material acquisitions, business combinations, divestitures, investments or partnerships by us or our competitors;

•recommendations by securities research analysts;

•changes in the economic performance or market valuations of companies in the cannabis industry;

•the addition or departure of our directors or executive officers and other key personnel;

•sales or perceived sales of additional ~~Subordinate~~shares ~~Voting~~of ~~Shares~~Common Stock;

•announcements of developments and other material events by us or our competitors;

•fluctuations to our costs of vital production materials and services;

•changes in ~~U.S.~~ financial markets and economies and general market conditions, such as inflation, interest rates, recessions and product price volatility; and

•news reports relating to trends, concerns, technological or competitive developments, regulatory changes and other related issues in the cannabis industry or our target markets.

In recent years, the securities markets in the U.S. and Canada have experienced a high level of price and volume volatility, and the market prices of securities of many cannabis companies have experienced wide fluctuations in price which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. Increased levels of volatility and resulting market turmoil may adversely impact the price of ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock. There can be no assurance that the fluctuations in the price of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ will not occur.

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A decline in the price or trading volume of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ could affect our ability to consummate acquisitions, expand existing operations, or raise further capital and could cause increased dilution to ~~shareholders~~stockholders and adversely impact our ability to continue current operations, which would have a negative impact on our revenues and profitability.

A prolonged decline in the price or trading volume of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ could in the future result in a reduction in the liquidity of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ and inhibit our ability to raise capital. Because a significant portion of our acquisitions and operations have been, and may continue to be, financed through the issuance of equity securities, a decline in the price or trading volume of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ could be especially detrimental to our growth strategy, liquidity and operations and may cause us to issue additional ~~Subordinate~~shares ~~Voting~~of ~~Shares~~Common Stock we otherwise would not need to, which would be dilutive to our ~~shareholders~~stockholders. Such reductions may force us to reallocate funds from other planned uses and may have a material adverse effect on our business plan and operations, including our ability to operationalize existing licenses, consummate acquisitions and complete planned capital expenditures. If the price or trading volume of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ declines, there can be no assurance that we will be able to raise additional capital or generate funds from operations sufficient to meet our obligations. If we are unable to raise sufficient capital in the future, we may not have the resources to continue our normal operations.

If securities or industry analysts do not publish research or reports about us or publish misleading, inaccurate, or unfavorable research about us, our business, ~~our~~ share price and trading volume could decline.

The trading market for ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ may be influenced by the research and reports that securities or industry analysts publish about us, our business, prospects, market, or competitors. If few securities or industry analysts cover us, the trading price and volume of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ would likely be negatively impacted. If one or more of the analysts who covers us downgrades ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock, publishes inaccurate or unfavorable research about our business, or provides more favorable relative recommendations about competitors, the price of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ could decrease, which could cause the ~~Subordinate Voting Share~~ price or trading volume of our Common Stock to decline.

An investor may face liquidity risks with an investment in ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock.

There is a significant liquidity risk associated with an investment in ~~the~~our ~~Subordinate~~Common ~~Voting Shares~~Stock. ~~The~~Our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ currently ~~trade~~trades on Cboe in Canada and ~~are~~is quoted on the OTCQX in the U.S. We cannot predict at what prices ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ will continue to trade or be quoted, and there is no assurance that an active trading market will be sustained. ~~The~~Our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~does do not currently trade on ~~any~~a U.S. national securities exchange. In the event ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~begins ~~begin~~ trading on any U.S. national securities exchange, we cannot predict at what prices ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ will trade and there is no assurance that an active trading market will develop or be sustained.

Trading in securities quoted on the OTCQX is often thin and characterized by wide fluctuations in trading prices due to many factors, some of which may have little to do with our financial results, operations or business prospects. This volatility could depress the market price of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ for reasons unrelated to our operating performance or financial results. Moreover, the OTCQX is not a U.S. national securities exchange, and trading of securities on the OTCQX is often more sporadic than the trading of securities listed on a U.S. national securities exchange such as the Nasdaq Stock Market or the New York Securities Exchange. These factors may result in investors having difficulty reselling ~~Subordinate~~our ~~Voting~~Common ~~Shares~~Stock on the OTCQX.

~~Shareholders~~Stockholders have little or no rights to participate in our business affairs.

~~With~~Other ~~the~~than ~~exception of~~ the limited rights of ~~shareholders~~stockholders under our articles of incorporation and bylaws, and pursuant to applicable Canadian, U.S. federal and Nevada laws, the day-to-day decisions regarding the management of our affairs will be made exclusively by the Board and our officers acting under the authority and supervision of the Board. Our ~~shareholders~~stockholders will have little or no control over our current or future business, investment decisions, ~~and~~or other affairs, including the selection and investment in licensees, dispensaries, cultivation operations and real estate. Further, Nevada law provides that the selection of a period for the achievement of corporate goals is the responsibility of the directors. We may also retain consultants, advisors and agents to provide various services to us, over which the ~~shareholders~~stockholders will have no control. ~~There can be no assurance that the Board, our officers, advisors or agents will effectively manage and direct our affairs.~~

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We do not expect to declare or pay dividends, and restrictions in our credit ~~facility~~facilities restrict our ability to pay cash dividends.

Holders of ~~the~~our ~~Subordinate~~Common ~~Voting~~Stock, ~~Shares and Proportionate Voting Shares~~ will not have a right to receive dividends on such shares unless declared by the Board. We have not paid dividends in the past, and we do not anticipate that we will declare or pay any dividends in the foreseeable future. The declaration of dividends is at the discretion of the Board, even if we have sufficient funds, net of our liabilities, to pay dividends, and the declaration of any dividend will depend on our financial results, cash requirements, future prospects, credit facility restrictions and other factors deemed relevant by the Board. Any dividends paid by us would be subject to withholding taxes as further summarized under the heading “Risks Related to Taxation.”

~~Our~~Certain ~~voting~~stockholders ~~control~~hold isover ~~concentrated~~5% of the Company’s voting power.

As of ~~February~~March 2510, ~~2025~~2026, George Archos, our Chairman and Chief Executive Officer, exercises in the aggregate, approximately 7.5% of the voting power in respect of our outstanding ~~shares~~Common Stock. In addition, per a public ownership filing made by the entity, Eminence Capital, LP beneficially owned 4127,~~431~~786,~~627~~719 ~~Subordinate~~shares ~~Voting~~of ~~Shares~~Common Stock as of ~~December~~November 3114, ~~2024~~2025, the date of Eminence Capital LP’s ~~last~~latest filing regarding its holdings of Verano equity, which represents approximately 117.57% of the voting power in respect of our outstanding shares. As a result, Mr. Archos and Eminence Capital, LP each has ~~substantial~~the ability to ~~control~~impact the outcome of matters submitted to our ~~shareholders~~stockholders for approval, including the election and removal of directors and any material business transactions. Even if Mr. Archos does not retain any employment with us, he will continue to have the ability to exercise this voting power.

As our Chairman and Chief Executive Officer, Mr. Archos has control over our day-to-day management and the implementation of major strategic decisions, subject to authorization and oversight by the Board. As a member of the Board, Mr. Archos owes a fiduciary duty to the Company and is obligated to act honestly and in good faith.

Such ~~concentration~~impact ofon voting power could have the effect of delaying, deterring, or preventing a change of control or other business combination, which could, in turn, have an adverse effect on the market price of our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ or prevent our stockholders from realizing a premium over the then-prevailing market price for their ~~Subordinate~~Common ~~Voting Shares~~Stock. In addition, sales of significant amounts of shares beneficially held by Mr. Archos or Eminence Capital, LP or the prospect of these sales, could adversely affect the market price of our ~~Subordinate~~Common ~~Voting Shares~~Stock.

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Risks Related to Taxation

WeAs a cannabis business, the IRS takes the view that we are subject to ~~Canadian~~certain tax provisions that have a material adverse effect on our business, financial condition, and ~~United~~results ~~States~~of operations. We may not be successful in defending our tax onfiling positions, which could adversely impact our ~~worldwide~~financial ~~income~~condition and results of operations.

We are deemed to be a resident of Canada for Canadian federal income tax purposes by virtue of being organized under the laws of British Columbia, a province of Canada. Accordingly, we are subject to Canadian taxation on our worldwide income, in accordance with the rules set forth in the Income Tax Act (Canada) (the “Tax Act”) generally applicable to corporations residing in Canada.

Notwithstanding that we are deemed to be a resident of Canada for Canadian federal income tax purposes, we are also treated as a U.S. corporation for U.S. federal income tax purposes, pursuant to Section 7874(b) of the Code, and we are subject to U.S. federal income tax on our worldwide income. As a result, we are subject to taxation both in Canada and the U.S., which could have a material adverse effect on our business, financial condition and results of operations. Accordingly, all our prospective investors and shareholders should consult with their own tax advisors in this regard.

We may not be successful in defending our tax filing positions, which could adversely impact our financial condition and results of operations.

If our tax positions, including with respect to employee retention credits available under the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, were to be challenged by federal, state, local or foreign tax jurisdictions, we may not be wholly successful in defending our tax filing positions. We record reserves for unrecognized tax benefits based on our assessment of the probability of successfully sustaining tax filing positions. Our management exercises significant judgment when assessing the probability of successfully sustaining our tax filing positions, and in determining whether a contingent tax liability should be recorded and, if so, estimating the amount. If our tax filing positions are successfully challenged, payments could be required that are in excess of reserved amounts, or we may be required to reduce the carrying amount of our net deferred tax asset, either of which could be significant to our financial condition and results of operations.

As a cannabis business, the IRS takes the view that we are subject to certain tax provisions that have a material adverse effect on our business, financial condition, and results of operations.

Under Section 280E of the Code, “no deduction or credit shall be allowed for any amount paid or incurred during the taxable year in carrying on any trade or business if such trade or business (or the activities which comprise such trade or business) consists of trafficking in controlled substances (within the meaning of Schedule I and II of the CSA) which is prohibited by Federal law or the law of any state in which such trade or business is conducted.” The IRS has interpreted this provision to apply to cannabis operations, prohibiting cannabis operators such as us, from deducting expenses directly associated with cannabis businesses. Section 280E and related IRS enforcement activity has had a significant impact on the operations of cannabis companies. As a result, an otherwise profitable business may, in fact, operate at a loss, after taking into account its United States income tax expenses. The Company has taken a position that it may deduct ordinary and necessary business expenses and that such expenses are not limited to the application of Section 280E of the Code.

The IRS has asserted against various state-legal cannabis businesses in the U.S that Section 280E applies to limit deductions for such businesses. Although the IRS has clarified its position by allowing the deduction of certain expenses, the IRS has interpreted this allowance very narrowly, deeming substantial other customary operating and general administrative costs as non-deductible. While there are currently several pending cases before various administrative and federal courts challenging the applicability of Section 280E, there is no guarantee that these administrative and/or federal courts will issue an interpretation of Section 280E that aligns with our position or that is otherwise favorable to the cannabis industry.

The IRS’s interpretations of Section 280E of the Code substantially limits our ability to deduct certain expenses from our federal taxable income for U.S. tax purposes.

If the IRS determined, and courts upheld that Section 280E does apply to restrict our deduction of business expenses, our U.S. federal taxable income would likely exceed our actual profits, and the IRS would likely continue to apply Section 280E to us indefinitely. This result may change if cannabis is rescheduled as a Schedule III substance under the CSA or if federal legislation affects Section 280E. We cannot predict whether such rescheduling or federal legislation will occur within a given timeframe or at all, and thus cannot predict the future applicability or effect of Section 280E on our business or operations.

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Dividends, if ever paid, on the Subordinate Voting Shares or Proportionate Voting Shares are subject to Canadian or United States withholding tax.

It is currently not anticipated that we will pay any dividends on the Subordinate Voting Shares or Proportionate Voting Shares in the foreseeable future.

To the extent dividends are paid, dividends received by our shareholders who are not residents of the U.S. (“Non-U.S. Holders”) and who are residents of Canada for purposes of the Tax Act will be subject to U.S. withholding tax. Any dividends may not qualify for a reduced rate of withholding tax under the U.S.-Canada income tax treaty (“U.S.-Canada Treaty”). In addition, a Canadian foreign tax credit or a deduction in respect of such U.S. withholding taxes paid may not be available.

Dividends received by shareholders who are residents of the U.S. (“U.S. Holders”) will not be subject to U.S. withholding tax but will be subject to Canadian withholding tax. Any dividends may not qualify for a reduced rate of withholding tax under the U.S.-Canada Treaty. For U.S. federal income tax purposes, a U.S. Holder may elect for any taxable year to receive either a credit or a deduction for all foreign income taxes paid by the holder during the year. Dividends paid by us will be characterized as U.S. source income for purposes of the foreign tax credit rules under the Code. Accordingly, U.S. Holders generally will not be able to claim a credit for any Canadian tax withheld unless, depending on the circumstances, they have an excess foreign tax credit limitation due to other foreign source income that is subject to a low or zero rate of foreign tax. Subject to certain limitations, a U.S. Holder should be able to take a deduction for the U.S. Holder’s Canadian tax paid, provided that the U.S. Holder has not elected to credit other foreign taxes during the same taxable year.

Dividends received by Non-U.S. Holders who are not residents of Canada for purposes of the Tax Act will be subject to U.S. withholding tax and will also be subject to Canadian withholding tax. These dividends may not qualify for a reduced rate of U.S. withholding tax under any income tax treaty otherwise applicable to our shareholders, subject to examination of the relevant treaty. These dividends may, however, qualify for a reduced rate of Canadian withholding tax under any income tax treaty otherwise applicable to our shareholders, subject to examination of the relevant treaty.

Each of our shareholders should seek tax advice, based on such shareholder’s particular facts and circumstances, from an independent tax advisor.

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The transfer of Subordinate Voting Shares may be subject to U.S. estate and generation-skipping transfer tax.

Because the Subordinate Voting Shares will be treated as shares of a U.S. domestic corporation for U.S. federal income tax purposes, the U.S. estate and generation-skipping transfer tax rules generally may apply to a Non-U.S. Holder of the Subordinate Voting Shares.

Each of our shareholders should seek tax advice, based on such shareholder’s particular facts and circumstances, from an independent tax advisor.

We may be classified as a USRPHC.

We are treated as a U.S. domestic corporation for U.S. federal income tax purposes under Section 7874(b) of the Code. As a result, the taxation of Non-U.S. Holders upon a disposition of Subordinate Voting Shares or Proportionate Voting Shares generally depends on whether we are classified as a U.S. real property holding corporation (a “USRPHC”) under the Code. We do not believe that we are or have been, and we do not anticipate becoming, a USRPHC. However, we do not expect to seek formal confirmation of our status as a non-USRPHC from the IRS. If we were to be considered a USRPHC, Non-U.S. Holders may be subject to U.S. federal income tax on any gain associated with the disposition of Subordinate Voting Shares or Proportionate Voting Shares, as applicable.

Changes in tax laws may affect us and our shareholders.

There can be no assurance that our Canadian and U.S. federal income tax treatment or an investment in us will not be modified, prospectively or retroactively, by legislative, judicial or administrative action, in a manner adverse to us or our shareholders.

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ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

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ITEM 1C. CYBERSECURITY

The Company faces cybersecurity threats such as ransomware and denial-of-service. The Company’s customers, vendors and business partners face similar cybersecurity threats, and a cybersecurity incident impacting the Company or any of these third-party entities could materially adversely affect our operations, performance and results of operations. In particular, the Company emphasizes the importance of cybersecurity as it may receive, store and transmit personal medical and other information relating to its customers, and believes it is imperative to protect this information from potential threats.

Additionally, the Board recognizes the ~~critical~~ importance of maintaining the trust and confidence of the Company’s customers, vendors, business partners and employees. The Board oversees the Company’s risk management program, and cybersecurity represents an important component of the Company’s overall approach to enterprise risk management (“ERM”). The Company’s Cybersecurity Incident Response Plan (the “Cybersecurity Plan”), which includes the Company’s standards, processes and practices are a component of the Company’s ERM program and are based on recognized frameworks established by the National Institute of Standards and Technology, the International Organization for Standardization and other applicable industry standards. In general, the Company’s Cybersecurity Plan states that it seeks to address cybersecurity risks through a comprehensive, cross-functional approach that is focused on (i) preserving restrictions on information access and disclosing, including means for protecting the confidentiality of personal private and proprietary information, (ii) guarding against improper information modification or destruction, and (iii) ensuring timely and reliable access to the Company’s information systems.

Risk Management and Strategy

As one of the ~~critical~~important elements of the Company’s overall ERM approach, the Company’s cybersecurity program is focused on the following key areas:

~~Preparing for Cybersecurity Risks:~~ The Company’s Cybersecurity Plan lays out on-going processes for incident response and prevention, including processes for bettering Company cybersecurity response following any cybersecurity incidents. All employees undergo training to aid in understanding the Company’s expectations for safeguarding all data stored on Company cyber networks. In addition to its Cybersecurity Plan, the Company has established risk management guidelines (the “Risk Management Guidelines”) that address the Company’s response to risks, including a cybersecurity incident. The Risk Management Guidelines describe the Company’s policy of managing enterprise risk, including external risks arising from cybersecurity threats and provide that the audit committee of the Board (the “Audit Committee”) will coordinate with and assist the Board in its oversight of risk.

The ~~Company’s~~ Risk Management Guidelines also dictate that the Board will ~~conduct~~review anand ~~annual~~discuss ~~performance~~with ~~evaluation~~management of the ~~Board’s oversight of the~~ Company’s ~~overall~~ risk~~-taking~~ ~~tolerance~~assessment ~~and~~process, risk management framework, ~~conducted~~control inand ~~such~~reporting ~~manner~~mechanisms, asimplementation ~~the~~process ~~Board~~and ~~deems appropriate~~monitoring.

~~Identify Risks and Notify Company of Risks:~~ The Cybersecurity Plan dictates an approach to identify and confirm expected incidents, to determine the severity of the risk and promptly take basic initial containment steps. The Cybersecurity Plan includes notification processes for certain cybersecurity incidents which aim to inform and activate an incident response team consisting of officers and employees at the Company and certain external service providers.

~~Containment, Eradication and Recovery:~~ The Company’s Cybersecurity Plan includes processes for containing ongoing cybersecurity threats if they occur and preventing past malicious activity, providing proposed solutions to malicious activity, and recovering any business processes with the goal of restoring business operations.

~~Third-Party Risk Management:~~ The Company’s Cybersecurity Plan contemplates a Company response to cybersecurity risks presented by third parties, including vendors, service providers and other external users of the Company’s systems, as well as the systems of third parties that could adversely impact our business in the event of a cybersecurity incident affecting those third-party systems.

66Per the Company’s Risk Management Guidelines, the Board may, in its discretion, delegate all or a portion of its duties and responsibilities to other committees of the Board. While the Board has not yet engaged assessors, consultants auditors or other third parties to aid in processes related to cybersecurity threats, any such committee will have the resources and authority appropriate to discharge its duties and responsibilities, including the authority to select, retain, terminate, and approve the fees and other retention terms of special or independent counsel, accountants or other experts, as it deems appropriate, without seeking approval of the Board or management. The Company may, from time to time, engage third party vendors to assist in developing, identifying and managing risks.

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Use of Third-Party Vendors: Per the Company’s Risk Management Guidelines, the Board may, in its discretion, delegate all or a portion of its duties and responsibilities to other committees of the Board. While the Board has not yet engaged assessors, consultants auditors or other third parties to aid in processes related to cybersecurity threats, any such committee will have the resources and authority appropriate to discharge its duties and responsibilities, including the authority to select, retain, terminate, and approve the fees and other retention terms of special or independent counsel, accountants or other experts, as it deems appropriate, without seeking approval of the Board or management. The Company may, from time to time, engage third party vendors to assist in developing, identifying and managing risks.

Governance

~~Board Oversight:~~ The Board has reviewed and discussed with management, the Company’s risk assessment process, risk management framework and reporting mechanisms, implementation and monitoring, including as each of these relates to cybersecurity risks. The Audit Committee coordinates and assists the Board in its oversight of risk. The Board and Audit Committee each receive presentations and reports on Company risks, including cybersecurity risks. The Cybersecurity Plan also contemplates that the Board will also receive prompt and timely information regarding any cybersecurity incident that meets established reporting thresholds, as well as ongoing updates regarding any such incident until it has been addressed. The Board has discussed the Company’s approach to cybersecurity risk management with the members of management, including the Company’s ~~Executive~~ Vice President, ofIT ~~Information~~- ~~Technology~~Business Operations.

~~Management:~~ The Company has a Cyber Incident Response Team (the “IRT”), which is comprised of employees including, among others, the ~~Executive~~Company’s Vice President, ofIT ~~Information~~- ~~Technology~~Business Operations, the Chief Financial Officer (“CFO”), the Chief Operations Officer (“COO”) and the Chief Legal Officer (“CLO”), as well as potential outside advisors and service providers, as deemed appropriate. The Cybersecurity Plan contemplates that, in the case of a cybersecurity risk, ~~Executive~~the Vice President, ofIT ~~Information~~- ~~Technology~~Business Operations, in coordination with the IRT, will work collaboratively across the Company to implement a program designed to protect the Company’s information systems from cybersecurity threats and to promptly respond to any cybersecurity incidents in accordance with the Company’s incident response and recovery plans. To facilitate the success of the Company’s cybersecurity risk management program, the Cybersecurity Plan contemplates that multidisciplinary teams throughout the Company will be deployed to address cybersecurity threats and to respond to cybersecurity incidents. Through ongoing communications with these teams, the Cybersecurity Plan dictates that the ~~Executive~~Company’s Vice President, ofIT ~~Information~~- ~~Technology~~Business Operations and the IRT monitor the prevention, detection, mitigation and remediation of cybersecurity threats and incidents in real time, and report such threats and incidents to the Board when appropriate.

The ~~Executive~~Company’s Vice President, ofIT ~~Information~~- ~~Technology~~Business Operations has served in various roles in information technology and information security for over 2510 years, including serving as ~~the~~a Chief ~~Information~~Technology Officer ofat other ~~public~~ companies.

Past Incidents

Risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected and we do not believe are reasonably likely to materially affect the Company, including its business strategy, results of operations or financial condition. However, the risk of cybersecurity threats could be significant if the cybersecurity attack disrupts the Company’s critical operations, service or financial systems. See “Item 1A — Risk Factors — Risks Related to our Business and Operations — Information Technology, Cybersecurity and Intellectual Property” for additional information on risks related to cybersecurity threats.

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ITEM 2. PROPERTIES

The following tables set forth the Company’s owned and leased physical properties as of February 25, 2025, which includes the corporate principal office, a call center, locations of operating dispensaries, dispensaries under construction and actively being planned, and locations for operating cultivation and processing facilities and cultivation and processing facilities under construction. In some cases, dispensary sites under construction or being planned are intended to be re-location sites. The cultivation and processing facilities in operation comprise over 1.1 million square feet.

State/City Comments/Description County Owned/Leased Use Operational *Subject to Mortgage ARIZONA Four cultivation facilities, one office, eight operating dispensary sites, one vacant leased site and one parking lease for the Prescott dispensary Chandler Maricopa Leased Office Yes Chandler Maricopa Leased Dispensary Yes Chino Valley Yavapai Leased Cultivation Yes Coolidge Pinal Owned Cultivation Yes Mesa* Maricopa Owned Dispensary Yes Mesa Maricopa Leased Dispensary Yes Phoenix Maricopa Leased Dispensary Yes Phoenix Maricopa Owned Dispensary Yes Phoenix Vacant (operations moved to below owned Phoenix site) Maricopa Leased Dispensary No Phoenix* Maricopa Owned Dispensary Yes Prescott Yavapai Leased Dispensary Yes Prescott Yavapai Leased Parking Yes Tempe Maricopa Leased Dispensary and Cultivation Yes Winslow* Navajo Owned Cultivation Yes CONNECTICUT One cultivation facility and five operating dispensary sites. Two dispensary sites under construction and one office and storage site Enfield Under Construction Hartford Owned Dispensary No Newington Hartford Leased Dispensary Yes Rocky Hill* Hartford Owned Cultivation Yes Meriden New Haven Leased Dispensary Yes Meriden New Haven Owned Office/Storage Yes Naugatuck New Haven Leased Dispensary Yes Waterbury New Haven Leased Dispensary Yes Norwich New London Leased Dispensary Yes Ashford Under Construction Windham Leased Dispensary No

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State/City Comments/Description County Owned/Leased Use Operational FLORIDA One call center/office, two operating cultivation facilities, eighty operating dispensary sites, two dispensary sites under construction, ten planned dispensary sites, one planned cultivation facility Gainesville Alachua Leased Dispensary Yes Panama City Bay Leased Dispensary Yes West Melbourne* Brevard Owned Dispensary Yes Melbourne Brevard Leased Dispensary Yes Merritt Island Brevard Leased Dispensary Yes Satellite Beach Brevard Leased Dispensary Yes Titusville Brevard Leased Dispensary Yes Deerfield Beach Broward Leased Dispensary Yes Hollywood Broward Leased Dispensary Yes Tamarac Broward Leased Dispensary Yes Port Charlotte* Charlotte Owned Dispensary Yes Orange Park Clay Leased Dispensary Yes Crystal River Under Construction Citrus Leased Dispensary No Marco Island Collier Leased Dispensary Yes Lake City Columbia Leased Dispensary Yes Jacksonville Beach Duval Leased Dispensary Yes Jacksonville Duval Leased Dispensary Yes Jacksonville Duval Leased Dispensary Yes Jacksonville In Planning Duval Owned Dispensary No Jacksonville In Planning Duval Leased Dispensary No Pensacola Escambia Leased Dispensary Yes Spring Hill Hernando Leased Dispensary Yes Sebring Highlands Leased Dispensary Yes Apollo Beach* Hillsborough Owned Cultivation Yes Apollo Beach* Hillsborough Owned Dispensary Yes Apollo Beach Hillsborough Owned Office Yes Brandon Hillsborough Leased Dispensary Yes Tampa Hillsborough Leased Dispensary Yes Tampa Hillsborough Leased Dispensary Yes Tampa Hillsborough Leased Dispensary Yes Tampa Hillsborough Leased Dispensary Yes Sebastian Indian River Leased Dispensary Yes Lady Lake Lake Leased Dispensary Yes Bonita Springs Lee Leased Dispensary Yes Cape Coral Lee Leased Dispensary Yes Fort Myers Lee Leased Dispensary Yes Fort Myers* Lee Owned Dispensary Yes Fort Myers Lee Leased Dispensary Yes Tallahassee* Leon Owned Dispensary Yes Tallahassee In Planning Leon Leased Dispensary No Bradenton Manatee Leased Dispensary Yes Bradenton Manatee Leased Dispensary Yes Ocala Marion Leased Dispensary Yes Hobe Sound Martin Leased Dispensary Yes Stuart Martin Leased Dispensary Yes Kendall Miami-Dade Leased Dispensary Yes Naranja Miami-Dade Leased Dispensary Yes North Miami Miami-Dade Owned Dispensary Yes North Miami Beach Miami-Dade Leased Dispensary Yes Palmetto Bay In Planning Miami-Dade Leased Dispensary No

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~~State/City~~ITEM Comments/Description County Owned/Leased Use Operational Key West Monroe Leased Dispensary Yes Yulee Nassau Leased Dispensary Yes Shalimar Okaloosa Leased Dispensary Yes Apopka Orange Leased Dispensary Yes Orlando Orange Leased Dispensary Yes Orlando Orange Leased Dispensary Yes Orlando Orange Leased Dispensary Yes Okeechobee Palm Beach Leased Dispensary Yes Wellington Palm Beach Leased Dispensary Yes West Palm Beach Palm Beach Leased Dispensary Yes West Palm Beach Palm Beach Leased Dispensary Yes Boynton Beach Palm Beach Leased Dispensary Yes Lutz Pasco Leased Dispensary Yes Port Richey Pasco Leased Dispensary Yes Zephyrhills Pasco Leased Dispensary Yes Clearwater Pinellas Leased Dispensary Yes Clearwater Pinellas Leased Dispensary Yes Pinellas Park Pinellas Leased Dispensary Yes St2. Petersburg Pinellas Leased Dispensary Yes Auburndale Polk Leased Dispensary Yes Haines City Polk Leased Dispensary Yes Lakeland Polk Leased Dispensary Yes Winter Haven Polk Leased Dispensary Yes Palatka Putnam Owned Cultivation Yes Palatka Putnam Leased Dispensary Yes Navarre Santa Rosa Leased Dispensary Yes North Port Sarasota Leased Dispensary Yes Sarasota Sarasota Leased Dispensary Yes Sarasota Sarasota Leased Dispensary Yes Venice Sarasota Leased Dispensary Yes Longwood* Seminole Owned Dispensary Yes Winter Springs Seminole Leased Dispensary Yes St Augustine St. Johns Leased Dispensary Yes Fort Pierce St. Lucie Leased Dispensary Yes Port Saint Lucie St. Lucie Leased Dispensary Yes Orange City Volusia Leased Dispensary Yes Ormond Beach Volusia Leased Dispensary Yes Port Orange Volusia Leased Dispensary Yes Daytona Beach In Planning Volusia Leased Dispensary No Miramar Beach In Planning Walton Leased Dispensary No Palm Bay In Planning Brevard Leased Dispensary No Deltona In Planning Volusia Leased Dispensary No Englewood In Planning Charlotte Leased Dispensary No New Smyrna Beach Under Construction Volusia Leased Dispensary No Lehigh Acres In Planning Lee Leased Dispensary No Ocala In Planning Marion Owned Cultivation NoPROPERTIES

The following tables set forth the Company’s owned and leased physical properties as of March 10, 2026, which includes the corporate principal office, a call center, locations of operating dispensaries, dispensaries under construction and actively being planned, and locations for operating cultivation and processing facilities and cultivation and processing facilities under construction. In some cases, dispensary sites under construction or being planned are intended to be re-location sites. The cultivation and processing facilities in operation comprise over 1.1 million square feet.

State/City

Comments/Description

County

Owned/Leased

Use

Operational

*Subject to Mortgage

ARIZONA

Two operating cultivation facilities, one non-operational cultivation facility, one office, eight operating dispensary sites, one vacant leased site and one parking lease for the Prescott dispensary

Chandler

Maricopa

Leased

Office

Yes

Chandler

Maricopa

Leased

Dispensary

Yes

Chino Valley

Yavapai

Leased

Cultivation

Yes

Coolidge*

Pinal

Owned

Cultivation

Yes

Mesa*

Maricopa

Owned

Dispensary

Yes

Mesa

Maricopa

Leased

Dispensary

Yes

Phoenix

Vacant (operations moved to below owned Phoenix site)

Maricopa

Leased

Dispensary

Phoenix*

Maricopa

Owned

Dispensary

Yes

Phoenix

Maricopa

Leased

Dispensary

Yes

Phoenix*

Maricopa

Owned

Dispensary

Yes

Prescott

Yavapai

Leased

Dispensary

Yes

Prescott

Yavapai

Leased

Parking

Yes

Tempe

Maricopa

Leased

Dispensary and Cultivation

Yes

Winslow*

Navajo

Owned

Cultivation

CONNECTICUT

One cultivation facility and seven operating dispensary sites and one office and storage site

Enfield*

Hartford

Owned

Dispensary

Yes

Newington

Hartford

Leased

Dispensary

Yes

Rocky Hill*

Hartford

Owned

Cultivation

Yes

Meriden

New Haven

Leased

Dispensary

Yes

Meriden*

New Haven

Owned

Office/Storage

Yes

Naugatuck

New Haven

Leased

Dispensary

Yes

Waterbury

New Haven

Leased

Dispensary

Yes

Norwich

New London

Leased

Dispensary

Yes

Ashford

Windham

Leased

Dispensary

Yes

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State/City Comments/Description County Owned/Leased Use Operational ~~ILLINOIS~~FLORIDA One ~~corporate~~call center/office, ~~one~~two ~~storage~~operating ~~facility~~cultivation facilities, ~~one~~eighty-three ~~cultivation~~operating ~~facility~~dispensary sites, ~~ten~~two dispensary sites under construction, ~~and~~eight planned dispensary sites, one ~~leased~~planned ~~warehouse~~cultivation ~~Chicago~~facility ~~Cook~~Gainesville Alachua Leased Dispensary Yes ~~Chicago~~Panama ~~Cook~~City Bay Leased ~~Office/Storage~~Dispensary Yes ~~Chicago~~Melbourne* ~~Cook~~Brevard Owned Dispensary Yes West Melbourne Brevard Leased Dispensary Yes ~~Chicago~~Merritt ~~Cook~~Island Brevard Leased ~~Office~~Dispensary Yes ~~Chicago~~Satellite ~~Cook~~Beach ~~Owned~~Brevard Leased Dispensary Yes ~~Evanston~~Titusville ~~Cook~~Brevard Leased Dispensary Yes ~~Prospect~~Deerfield ~~Heights~~Beach ~~Cook~~Broward Leased Dispensary Yes ~~Lombard~~Hollywood ~~DuPage~~Broward Leased Dispensary Yes ~~Naperville~~Tamarac ~~DuPage~~Broward Leased Dispensary Yes ~~Albion~~Port ~~Edwards~~Charlotte* Charlotte Owned ~~Cultivation~~Dispensary Yes ~~Albion~~Orange ~~Edwards~~Park Clay Leased ~~Warehouse~~Dispensary Yes ~~Aurora~~Crystal ~~Kane~~River Citrus Leased Dispensary Yes ~~St.~~Marco ~~Charles~~Island ~~Kane~~Collier Leased Dispensary Yes ~~Highland~~Lake ~~Park~~City Columbia Leased Dispensary Yes Jacksonville Beach Duval Leased Dispensary Yes Jacksonville Duval Leased Dispensary Yes Jacksonville Duval Leased Dispensary Yes Jacksonville* ~~Lake~~In Planning Duval Owned Dispensary ~~Yes~~No ~~MARYLAND~~Jacksonville ~~One~~In ~~cultivation~~Planning ~~facility~~Duval ~~and~~Leased ~~four~~Dispensary ~~operating~~No ~~dispensaries~~Pensacola ~~Towson~~Escambia ~~Baltimore~~Leased Dispensary Yes Spring Hill Hernando Leased Dispensary Yes ~~Elkridge~~Sebring ~~Howard~~Highlands Leased Dispensary Yes ~~Jessup~~Apollo Beach* ~~Howard~~Hillsborough Owned Cultivation Yes ~~Germantown~~Apollo ~~Montgomery~~Beach* ~~Leased~~Hillsborough Owned Dispensary Yes ~~Pasadena~~Apollo Beach* ~~Anne~~Hillsborough ~~Arundel~~ Owned Office Yes Brandon Hillsborough Leased Dispensary Yes ~~MASSACHUSETTS~~Tampa ~~One~~Hillsborough ~~reduced~~Leased ~~operations~~Dispensary ~~cultivation~~Yes ~~facility~~Tampa ~~and~~Hillsborough ~~two~~Leased ~~operating~~Dispensary ~~dispensaries~~Yes ~~Sharon~~Tampa ~~Norfolk~~Hillsborough Leased Dispensary Yes ~~Sharon~~Tampa ~~Norfolk~~Hillsborough ~~Owned~~Leased ~~Cultivation~~Dispensary Yes ~~Plymouth~~Sebastian ~~Plymouth~~Indian River Leased Dispensary Yes ~~MICHIGAN~~Lady ~~One~~Lake ~~operating~~Lake ~~dispensary~~Leased ~~Buchanan~~Dispensary ~~Berrien~~Yes ~~Owned~~Bonita Springs Lee Leased Dispensary Yes ~~NEVADA~~Cape ~~One~~Coral ~~operating~~Lee ~~cultivation~~Leased ~~facility,~~Dispensary ~~five~~Yes ~~operating~~Fort ~~dispensary~~Myers ~~sites~~Lee ~~and~~Leased ~~one~~Dispensary ~~dispensary~~Yes ~~under~~Fort ~~construction~~Myers* ~~Carson~~Lee ~~City~~Owned ~~Carson~~Dispensary ~~City~~Yes Fort Myers Lee Leased Dispensary Yes ~~North~~Tallahassee* ~~Las~~Leon ~~Vegas~~Owned ~~Under~~Dispensary ~~Construction~~Yes ~~Clark~~Tallahassee ~~Owned~~In Planning Leon Leased Dispensary No ~~Las~~Bradenton ~~Vegas~~Manatee ~~Clark~~Leased ~~Owned~~ Dispensary Yes ~~North~~Bradenton ~~Las~~Manatee ~~Vegas~~Leased ~~Clark~~Dispensary ~~Owned~~Yes ~~Cultivation~~Ocala Marion Leased Dispensary Yes ~~North~~Hobe ~~Las~~Sound ~~Vegas~~Martin ~~Clark~~Leased Dispensary Yes Stuart Martin Leased Dispensary Yes ~~Spring~~Miami ~~Valley~~Miami-Dade ~~Clark~~Leased Dispensary Yes Naranja Miami-Dade Leased Dispensary Yes ~~Reno~~North ~~Washoe~~Miami* Miami-Dade Owned Dispensary Yes North Miami Beach Miami-Dade Leased Dispensary Yes Palmetto Bay In Planning Miami-Dade Leased Dispensary No

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State/City Comments/Description County Owned/Leased Use Operational ~~NEW~~Key ~~JERSEY~~West ~~One~~Monroe ~~cultivation~~Leased ~~facility,~~Dispensary ~~four~~Yes ~~dispensary~~Yulee ~~sites,~~Nassau ~~and~~Leased ~~one~~Dispensary ~~parking~~Yes ~~lease~~Shalimar ~~for~~Okaloosa ~~Lawrence~~Leased ~~dispensary~~Dispensary ~~Mount~~Yes ~~Holly~~Apopka ~~Burlington~~Orange Leased Dispensary Yes Branchburg*Orlando ~~Hunterdon~~Orange ~~Owned~~Leased ~~Cultivation~~Dispensary Yes ~~Lawrence~~Orlando ~~Mercer~~Orange Leased ~~Parking~~Dispensary Yes ~~Lawrence~~Orlando ~~Mercer~~Orange Leased Dispensary Yes ~~Neptune~~Okeechobee ~~Monmouth~~Palm Beach Leased Dispensary Yes ~~Elizabeth~~Wellington ~~Union~~Palm Beach Leased Dispensary Yes ~~OHIO~~West ~~One~~Palm ~~cultivation~~Beach ~~facility,~~Palm ~~five~~Beach ~~operating~~Leased ~~dispensaries,~~Dispensary ~~one~~Yes ~~dispensary~~West inPalm ~~planning,~~Beach ~~and~~Palm ~~one~~Beach ~~parking~~Leased ~~lot~~Dispensary ~~Cincinnati~~Yes ~~Hamilton~~Boynton Beach Palm Beach Leased Dispensary Yes ~~Dayton~~Lutz ~~Montgomery~~Pasco Leased Dispensary Yes ~~Canton~~Port ~~Stark~~Richey Pasco Leased Dispensary Yes ~~Canton~~Zephyrhills ~~Stark~~Pasco ~~Owned~~Leased ~~Cultivation~~Dispensary Yes ~~Bowling~~Clearwater ~~Green~~Pinellas ~~Wood~~ Leased Dispensary Yes Newark*Clearwater ~~Licking~~Pinellas ~~Owned~~Leased Dispensary Yes ~~Antwerp~~Pinellas ~~Paulding~~Park ~~Owned~~Pinellas ~~Parking~~Leased Dispensary Yes ~~PENNSYLVANIA~~St. ~~One~~Petersburg ~~cultivation~~Pinellas ~~facility,~~Leased ~~eighteen~~Dispensary ~~dispensary~~Yes ~~sites,~~Tarpon ~~one~~Springs ~~cultivation~~Pinellas ~~facility~~Leased ~~under~~Dispensary ~~construction,~~Yes ~~one~~Auburndale ~~cultivation~~Polk ~~facility~~Leased ~~that~~Dispensary isYes ~~not~~Haines ~~operational,~~City ~~one~~Polk ~~parking~~Leased ~~lease,~~Dispensary ~~one~~Yes ~~leased~~Lakeland ~~storage~~Polk ~~space,~~Leased ~~one~~Dispensary ~~office~~Yes ~~space,~~Winter ~~two~~Haven ~~vacant~~Polk ~~dispensary~~Leased ~~sites~~Dispensary ~~Monroeville~~Yes Palatka* ~~Allegheny~~Putnam Owned ~~Dispensary~~Cultivation Yes ~~Pittsburgh~~Palatka ~~Allegheny~~Putnam Leased Dispensary Yes ~~Pittsburgh~~Navarre ~~Allegheny~~Santa Rosa Leased Dispensary Yes ~~Fairless~~North ~~Hills~~Port ~~Bucks~~Sarasota Leased Dispensary Yes ~~Sellersville~~Sarasota ~~Bucks~~Sarasota Leased ~~Parking~~Dispensary Yes ~~Sellersville~~Sarasota ~~Bucks~~Sarasota Leased Dispensary Yes Cranberry*Venice ~~Butler~~Sarasota ~~Owned~~Leased Dispensary Yes ~~Malvern~~Longwood* ~~Chester~~Seminole ~~Leased~~Owned Dispensary Yes ~~Malvern~~Winter ~~Chester~~Springs Seminole Leased ~~Storage~~Dispensary Yes ~~Harrisburg~~St ~~Dauphin~~Augustine St. Johns Leased Dispensary Yes Chester*Fort ~~Delaware~~Pierce ~~Owned~~St. ~~Cultivation~~Lucie ~~Yes~~Leased ~~Chester~~Dispensary ~~Delaware~~Yes ~~Leased~~Port ~~Cultivation~~Saint NoLucie Chester*St. ~~Delaware~~Lucie ~~Owned~~Leased Dispensary NoYes ~~Clifton~~Orange ~~Heights~~City ~~Delaware~~Volusia Leased Dispensary Yes ~~Upland~~Ormond ~~Under~~Beach ~~Construction~~Volusia ~~Delaware~~Leased ~~Owned~~Dispensary ~~Cultivation~~Yes NoPort ~~West~~Orange ~~Chester~~Volusia ~~Delaware~~ Leased Dispensary Yes ~~Altoona~~Daytona ~~Logan~~Beach ~~Leased~~In ~~Dispensary~~Planning ~~Yes~~Volusia Abington*Leased ~~Montgomery~~Dispensary ~~Owned~~No ~~Dispensary~~Miramar ~~Yes~~Beach ~~Abington~~Under ~~Montgomery~~Construction Walton Leased Dispensary No ~~Jenkintown~~Palm ~~Montgomery~~Bay ~~Leased~~In ~~Office~~Planning NoBrevard Wynnewood*Leased ~~Montgomery Owned~~ Dispensary ~~Yes~~No ~~Norristown~~Deltona ~~Montgomery~~Volusia Leased Dispensary Yes ~~Philadelphia~~Englewood ~~Philadelphia~~In Planning Charlotte Leased Dispensary ~~Yes~~No Washington*New ~~Washington~~Smyrna ~~Owned~~Beach Volusia Leased Dispensary Yes ~~New~~Lehigh ~~Kensington~~Acres ~~Westmoreland~~Under construction Lee Leased Dispensary ~~Yes~~No ~~York~~Ocala* ~~York~~In ~~Leased~~Planning ~~Dispensary~~Marion ~~Yes~~Owned Cultivation No

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State/City Comments/Description County Owned/Leased Use Operational ~~VIRGINIA~~ILLINOIS One corporate office, one storage space, one cultivation facility, ten dispensary sites, and ~~six~~one ~~operating~~leased ~~dispensaries~~warehouse ~~Hampton~~Chicago ~~Hampton~~Cook Leased Dispensary Yes ~~Norfolk~~Chicago ~~Norfolk~~Cook Leased Office/Storage Yes Chicago Cook Leased Dispensary Yes ~~Portsmouth~~Chicago ~~Portsmouth~~Cook Leased ~~Cultivation~~Office ~~and~~Yes Chicago* Cook Owned Dispensary Yes ~~Suffolk~~Evanston ~~Suffolk~~Cook Leased Dispensary Yes ~~Virginia~~Prospect ~~Beach~~Heights ~~Virginia~~Cook ~~Beach~~Leased Dispensary Yes Lombard DuPage Leased Dispensary Yes ~~Williamsburg~~Naperville ~~York~~DuPage Leased Dispensary Yes ~~WEST~~Albion* ~~VIRGINIA~~Edwards Owned Cultivation Yes Albion Edwards Leased Warehouse Yes Aurora Kane Leased Dispensary Yes St. Charles Kane Leased Dispensary Yes Highland Park* Lake Owned Dispensary Yes MARYLAND One cultivation facility and ~~five~~four operating dispensaries ~~Clarksburg~~Towson ~~Harrison~~Baltimore Leased Dispensary Yes ~~Morgantown~~Elkridge ~~Monongalia~~Howard Leased Dispensary Yes ~~Westover~~Jessup* ~~Monongalia~~Howard Owned Cultivation Yes Germantown Montgomery Leased Dispensary Yes ~~Wheeling~~Pasadena* ~~Ohio~~Anne Arundel Owned Dispensary Yes MASSACHUSETTS One non-operating cultivation facility and two operating dispensaries Sharon Norfolk Leased Dispensary Yes ~~Beaver~~Sharon* ~~Raleigh~~Norfolk Owned Cultivation No Plymouth Plymouth Leased Dispensary Yes MICHIGAN One operating dispensary Buchanan* Berrien Owned Dispensary Yes NEVADA One operating cultivation facility, five operating dispensary sites and one non-operational dispensary Carson City Carson City Leased Dispensary Yes North Las Vegas* Clark Owned Dispensary Yes Las Vegas* Clark Owned Dispensary No North Las Vegas* Clark Owned Cultivation Yes ~~Buckhannon~~North ~~Upshur~~Las Vegas Clark Leased Dispensary Yes Spring Valley Clark Leased Dispensary Yes Reno Washoe Leased Dispensary Yes

Table of Contents

State/City

Comments/Description

County

Owned/Leased

Use

Operational

NEW JERSEY

One cultivation facility, four dispensary sites, and one parking lease for Lawrence dispensary

Mount Holly

Burlington

Leased

Dispensary

Yes

Branchburg*

Hunterdon

Owned

Cultivation

Yes

Lawrence

Mercer

Leased

Parking

Yes

Lawrence

Mercer

Leased

Dispensary

Yes

Neptune

Monmouth

Leased

Dispensary

Yes

Elizabeth

Union

Leased

Dispensary

Yes

OHIO

One cultivation facility, six operating dispensaries, and one parking lot

Cincinnati

Hamilton

Leased

Dispensary

Yes

Dayton

Montgomery

Leased

Dispensary

Yes

Canton

Stark

Leased

Dispensary

Yes

Canton*

Stark

Owned

Cultivation

Yes

Bowling Green

Wood

Leased

Dispensary

Yes

Newark*

Licking

Owned

Dispensary

Yes

Antwerp

Paulding

Leased

Dispensary

Yes

Antwerp

Paulding

Owned

Parking

Yes

PENNSYLVANIA

One cultivation facility, eighteen dispensary sites, one cultivation facility that is not operational, one parking lease, one leased storage space, one office space, two vacant dispensary sites

Monroeville*

Allegheny

Owned

Dispensary

Yes

Pittsburgh

Allegheny

Leased

Dispensary

Yes

Pittsburgh

Allegheny

Leased

Dispensary

Yes

Fairless Hills

Bucks

Leased

Dispensary

Yes

Sellersville

Bucks

Leased

Parking

Yes

Sellersville

Bucks

Leased

Dispensary

Yes

Cranberry*

Butler

Owned

Dispensary

Yes

Malvern

Chester

Leased

Dispensary

Yes

Malvern

Chester

Leased

Storage

Yes

Harrisburg

Dauphin

Leased

Dispensary

Yes

Chester*

Delaware

Owned

Cultivation

Yes

Chester

Delaware

Leased

Cultivation

Chester*

Delaware

Owned

Dispensary

Clifton Heights

Delaware

Leased

Dispensary

Yes

West Chester

Delaware

Leased

Dispensary

Yes

Altoona

Logan

Leased

Dispensary

Yes

Abington*

Montgomery

Owned

Dispensary

Yes

Abington

Montgomery

Leased

Dispensary

Jenkintown

Montgomery

Leased

Office

Wynnewood*

Montgomery

Owned

Dispensary

Yes

Norristown

Montgomery

Leased

Dispensary

Yes

Philadelphia

Leased

Dispensary

Yes

Washington*

Washington

Owned

Dispensary

Yes

New Kensington

Westmoreland

Leased

Dispensary

Yes

York

Leased

Dispensary

Yes

Table of Contents

State/City

Comments/Description

County

Owned/Leased

Use

Operational

VIRGINIA

One cultivation facility and six operating dispensaries

Hampton

Leased

Dispensary

Yes

Norfolk

Leased

Dispensary

Yes

Portsmouth

Leased

Cultivation and Dispensary

Yes

Suffolk

Leased

Dispensary

Yes

Virginia Beach

Leased

Dispensary

Yes

Williamsburg

York

Leased

Dispensary

Yes

WEST VIRGINIA

One cultivation facility and six operating dispensaries

Clarksburg

Harrison

Leased

Dispensary

Yes

Morgantown

Monongalia

Leased

Dispensary

Yes

Westover

Monongalia

Leased

Dispensary

Yes

Wheeling

Ohio

Leased

Dispensary

Yes

Beaver

Raleigh

Leased

Cultivation

Yes

Buckhannon

Upshur

Leased

Dispensary

Yes

Charleston

Kanawha

Leased

Dispensary

Yes

Properties Subject to an Encumbrance.

A substantial portion of the real property owned by the Company’s subsidiaries is subject to mortgages that secure outstanding indebtedness for borrowed money or are otherwise pledged as collateral securing the obligations of the ~~Borrowers~~Real ~~that~~Estate ~~are~~Subsidiaries ~~outstanding~~under the Revolver and the 2026 Borrowers under the ~~2022~~2026 Credit Agreement. In addition, the 2026 Borrowers have pledged a substantial portion of their other assets to secure, on a joint and several basis, the obligations under the ~~2022~~2026 Credit Agreement, including their cash, accounts receivable, inventory, licenses and permits, intellectual property, equipment and ownership interests in other 2026 Borrowers. Dollar amounts below are in thousands.

On June 29, 2022, the Company entered into a real estate loan with a community bank to borrow an initial principal amount of $18,000 secured by real estate and improvements thereon in Branchburg, New Jersey. The mortgage bears an interest rate of 4% and matures in July 2047.

On March 9, 2023, the Company entered into a real estate loan with a community bank to borrow an initial principal amount of $20,000 secured by real estate and improvements thereon in Rocky Hill, Connecticut. The loan bears an interest rate of 5.75% and matures in March 2028, and may be extended for four additional five-year periods.

On ~~September~~March 2923, 2023, the Company entered into a real estate loan with a community bank to borrow an initial principal amount of $143,~~500~~710 secured by real estate and improvements in ~~Chester~~Highland Park, ~~Pennsylvania~~Illinois. The loan bears an interest rate of 7.525% and matures in ~~October~~March 2028.

On ~~December~~September 2629, 2023, the Company entered into a real estate loan with a community bank to borrow an ~~anitial~~initial principal amount of $2714,~~999~~500 secured by real estate in ~~Apollo Beach~~Chester, ~~Florida~~Pennsylvania. The loan bore interest at a rate of 7.5% until January 1, 2026 and now bears an interest rate of 8~~.34~~% and matures in ~~December~~October 2028.

73On December 26, 2023, the Company entered into a real estate loan with a community bank to borrow an initial principal amount of $27,999 secured by real estate in Apollo Beach, Florida. The loan bears an interest rate of 8.34% and matures in December 2028.

On March 14, 2025, the Company entered into a loan with Rainbow Realty Group IV, LLC to borrow a principal amount of $12,000 secured by real estate in Coolidge, Arizona and North Las Vegas, Nevada. The loan bears an interest rate of 11% per annum and matures in March 2030.

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ITEM 3. LEGAL PROCEEDINGS

On January 31, 2022, the Company entered into an Arrangement Agreement (the “~~GGH~~ Arrangement Agreement”) with Vireo Growth Inc. (“Vireo”), formerly known as Goodness Growth Holdings, Inc. ~~(“GGH”)~~, pursuant to which itthe Company agreed to acquire all of the issued and outstanding equity interests of ~~GGH~~Vireo in exchange for equity interests in the Company, subject to the conditions set forth in the ~~GGH~~ Arrangement Agreement. On October 13, 2022, the Company provided written notice to ~~GGH~~Vireo of ~~GGH~~Vireo’s breach of the ~~GGH~~ Arrangement Agreement and exercised the Company’s termination rights under the ~~GGH~~ Arrangement Agreement. On October 21, 2022, ~~GGH~~Vireo filed suit against the Company in a notice of Civil Claim captioned Goodness Growth Holdings, Inc. v. Verano Holdings Corp. in the Supreme Court of British Columbia , Canada, Vancouver Registry, Case No. S-228521, alleging that the Company breached (i) the ~~GGH~~ Arrangement Agreement through, among other things, the purported wrongful repudiation of the ~~GGH~~ Arrangement Agreement, (ii) the duty of good faith, and (iii) the duty of honest performance in contract. InOn ~~addition, on~~ November 14, 2022, the Company filed a response and counterclaim asserting that ~~GGH~~Vireo ~~owes~~owed it a termination fee in the amount of $14,875,000, or alternatively, the reimbursement of out-of-pocket fees and expenses of up to $3,000,000 as a result of our termination of the ~~GGH~~ Arrangement Agreement, which was based upon our belief that ~~GGH~~Vireo breached covenants and representations in the ~~GGH~~ Arrangement Agreement and the occurrence of other termination events. GGH filed a response to such counterclaim on December 7, 2022, in which GGH denied it was obligated to pay any termination fee or transaction expenses. As of December 31, 2024, both the Company and GGH are engaged in ongoing discovery efforts.

OnSubsequent court filings were made by the parties, including on May 2, 2024, ~~GGH~~when Vireo filed an application with the Supreme Court of British Columbia seeking ~~an order granting summary trial in the ongoing litigation between the Company and GGH regarding the GGH Arrangement Agreement. In the application, GGH stated it is seeking~~ $860,900,000 in damages, plus costs and interest ~~(the “GGH Application for Summary Trial”)~~. On ~~June~~October 1928, ~~2024~~2025, the Company ~~filed~~and anVireo ~~application~~executed ina ~~response~~comprehensive ~~seeking:~~settlement ~~(i)~~agreement, ~~dismissal~~with ofsettlement ~~the~~terms ~~GGH~~that ~~Application~~included ~~for~~a ~~Summary~~mutual ~~Trial~~release onof ~~the~~all ~~grounds~~claims ~~that~~arising ~~the~~or ~~issues~~resulting ~~raised~~from bythe itissues ~~are~~underlying ~~not~~the ~~suitable~~litigation ~~for disposition by summary trial~~ and ~~will not assist~~ the ~~efficient~~dismissal ~~resolution~~ of ~~the~~all ~~proceeding;~~outstanding ~~and~~litigation ~~(ii)~~claims anbetween ~~order~~Vireo ~~that~~and the ~~report~~Company onpending ~~damages~~before ~~filed~~the bySupreme ~~GGH~~Court ~~in support~~ of ~~the~~British ~~GGH~~Columbia. ~~Application~~The ~~for~~settlement ~~Summary~~consideration ~~Trial~~consisted isof ~~inadmissible~~(i) ~~and~~a ~~shall~~$1,000,000 becash ~~excluded~~payment from ~~evidence in~~ the ~~trial,~~Company orto ~~any~~Vireo ~~summary~~and ~~trial,~~(ii) ofthe ~~this~~Company’s ~~matter.~~conveyance Onto ~~September~~Vireo ~~17,~~of ~~2024,~~a ~~the~~real ~~Company~~estate ~~filed~~parcel with an ~~amended~~unfinished ~~response~~ and ~~counterclaim~~non-operational ~~with~~cultivation ~~the Supreme Court of British Columbia~~facility, ~~primarily~~with insuch ~~response~~real toestate ~~communications~~valued ~~recently disclosed~~ by ~~GGH.~~the ~~The~~parties ~~Company~~at ~~can~~$9,000,000. ~~provide~~On noNovember ~~guarantees~~20, or2025, ~~assurances~~in ~~that~~accordance itwith ~~will~~the ~~prevail~~settlement oragreement, ~~settle~~the ~~this~~Supreme ~~lawsuit~~Court orof ~~its~~British ~~counterclaim~~Columbia onentered ~~favorable~~a ~~terms,~~consent iforder atdismissing all, ~~and~~claims anpending ~~adverse~~against ~~outcome~~Vireo ~~could~~and ~~have~~the ~~a material adverse effect on its business~~Company, ~~results~~concluding ofthis ~~operations and financial condition~~matter.

See “Note 13 – Contingencies and Other” in the Notes to the Consolidated Financial Statements in this Form 10-K for further information.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

7476

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

The ~~Subordinate~~Company’s ~~Voting~~common ~~Shares~~stock; ~~are~~par value $0.001 per share, is traded on Cboe Canada under the stock symbol, “VRNO” and ~~are~~is traded over-the-counter in the U.S. on the OTCQX under the symbol “~~VRNOF~~VRNO.” Any over-the-counter market quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

~~Shareholders~~Stockholders

As of ~~February~~March 2510, ~~2025~~2026, there were ~~601~~571 qualified active holders of record of our ~~Subordinate~~Common ~~Voting~~Stock ~~Shares~~ and no registered holders of record of our ~~Proportionate~~Preferred ~~Voting~~Stock ~~Shares~~as none has been issued.

Dividends

There are no restrictions in the Company’s articles of incorporation that prevent the Company from paying dividends. However, the Company has not paid dividends in the past, and it is not anticipated that the Company will pay any dividends in the foreseeable future. Rather, the Company currently intends to retain future earnings, if any, to fund the development and growth of its business, pay indebtedness and does not intend to pay any cash dividends on its shares for the foreseeable future. Any decision to pay dividends in the future will be made by the Board on the basis of earnings, financial requirements and other conditions existing at the time. In the event any dividends are declared and paid, ~~both~~ the outstanding ~~Subordinate~~Common ~~Voting~~Stock ~~Shares and Proportionate Voting Shares, if any,~~ will share in the dividends with each Proportionate Voting Share being entitled to 100 times the amount of the dividend paid on each Subordinate Voting Share and each Subordinate Voting Share being entitled to 1/100 of the amount of the dividend paid on each Proportionate Voting Share. In the event the Board determines that a dividend is in the best interest of the Company, the terms and payment of such dividend must comply with the restrictions and covenants set forth in the ~~2022~~Company’s ~~Credit~~credit ~~Agreement~~facilities.

Recent Sales of Unregistered Securities

The following information represents securities sold by the Company for the period covered by this Form 10-K which were not registered under the Securities Act and which were not previously disclosed on a Quarterly Report on Form 10-Q or Current Report on Form 8-K. Included are new issuances, securities issued in exchange for property, services or other securities, and securities issued upon conversion or vesting of other Company securities not required to be disclosed in Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Certain sales of unregistered securities were reported on Current Reports on Form 8-K during ~~2024~~2025.

Equity Incentive Plan

During the year ended December 31, 2024, pursuant to the Verano Holdings Corp. Stock and Incentive Plan (the “Plan”), the Company issued 904,268 Subordinate Voting Shares, which were not registered under the Securities Act, in respect of vested restricted stock units (“RSUs”). The Company issued these securities pursuant to the exemption from registration provided by Rule 701 of the Securities Act, as the RSUs and Subordinate Voting Shares were issued in connection with a compensatory benefit plan and/or Section 4(a)(2) of the Securities Act with respect to recipients who were accredited investors.

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Acquisition Sales

On December 28, 2023, the Company became contractually obligated, upon the completion of certain conditions precedent, to issue $1,250,000 worth of Subordinate Voting Shares, ~~in the aggregate,~~ as consideration for the acquisition of certain assets ~~from Ivy Hall Mount Holly, LLC~~. During 2024, 297,225 Subordinate Voting Shares, were issued to the seller of such acquired assets as a portion of such consideration, representing a value of $625,000. ~~The~~During ~~Company~~2025 ~~expects~~the toCompany ~~issue~~issued an additional 297,555 Subordinate Voting Shares asto the ~~final~~seller ~~portion~~ of such ~~consideration~~acquired ~~during~~assets, ~~2025.~~representing ~~All~~a value of ~~such~~$625,000. All Subordinate Voting Shares were, ~~and~~converted ~~will~~to ~~be,~~Common Stock on a one-for-one basis in connection with the Continuance. All of such shares were issued in reliance upon the exemptions from registration afforded by Section 4(a)(2) and Rule 506 promulgated under the Securities Act, because (i) the issuances were not made by general solicitation or advertising and (ii) the issuances were made only to “accredited investors” (as such term is fined in Rule 501(a) of Regulation D under the Securities Act).

On November 10, 2021, the Company entered into an agreement (the “Caring Nature Purchase Agreement”) to acquire all the issued and outstanding equity interests in Caring Nature LLC (“Caring Nature”), which operates a dispensary in Connecticut. The transaction closed on December 20, 2021. The Caring Nature Purchase Agreement included $2,000,000 of contingent consideration to be paid in Subordinate Voting Shares. On October 21, 2024, following the fulfillment of conditions for the contingent consideration, the Company issued 616,276 Subordinate Voting Shares to the previous member of Caring Nature. All of such Subordinate Voting Shares were issued in reliance upon the exemptions from registration afforded by Section 4(a)(2) and Rule 506 promulgated under the Securities Act, because (i) the issuances were not made by general solicitation or advertising and (ii) the issuances were made only to an “accredited investor” (as such term is fined in Rule 501(a) of Regulation D under the Securities Act).77

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Stock Performance Graph

The information contained in this Stock Performance Graph section shall not be deemed to be “soliciting material” or “filed” or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Exchange Act, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act or the Exchange Act.

The following graph compares the cumulative total ~~shareholder~~stockholder return on the Subordinate Voting Shares from February 17, 2021 to November 3, 2025 and on shares of our Common Stock from November 3, 2025 to December 31, ~~2024~~2025, with the comparable cumulative return of the Russell 2000 Index and a selected peer group of companies. From February 17, 2021 through October 17, 2023, the Subordinate Voting Shares were traded on the CSE under the stock symbol VRNO. On October 18, 2023, the Subordinate Voting Shares began trading on Cboe under the stock symbol VRNO. On the Continuance Effective Date, as part of the Continuance, the previously authorized, issued and outstanding Subordinate Voting Shares of the Company were exchanged for authorized, issued and outstanding shares of Common Stock on a one-for-one basis. The below chart shows cumulative total ~~shareholder~~stockholder returns for Verano and the comparison assumes all dividends have been reinvested (if any) and an initial investment of $100 on February 17, 2021. The returns of each company in the peer group have been weighted to reflect their market capitalization. The stock price performance on the following graph is not necessarily indicative of future stock price performance.

	Base Period	Years Ending
Company/Index	2/17/2021	12/31/2021	12/31/2022	12/31/2023	12/31/2024	12/31/2025
Verano Holdings Corp.	100	38.22	9.62	13.47	3.71	3.01
Russell 2000 Index	100	99.52	78.07	89.85	98.85	110.01
Peer Group	100	44.31	16.89	18.63	12.74	14.67

Below are the specific companies included in the peer group.


Peer Group Companies
–Cresco Labs Inc.			–Trulieve Cannabis Corp.
–Curaleaf Holdings, Inc.			–Green Thumb Industries Inc.

Repurchases

During the year ended December 31, ~~2024~~2025, the Company did not repurchase any securities.

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CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

The following is, as of the date of this Form 10-K, a summary of the principal Canadian federal income tax considerations generally applicable under the Tax Act to shareholders who beneficially own Subordinate Voting Shares, and who at all relevant times, for purposes of the Tax Act, (i) hold their Subordinate Voting Shares as capital property, (ii) deal at arm’s length with Verano and (iii) are not affiliated with Verano (each such person, a “Holder”). Generally, Subordinate Voting Shares will be considered to be capital property to the holder thereof provided that they are not held in the course of carrying on a business of buying and selling securities and have not been acquired in one or more transactions considered to be an adventure or concern in the nature of trade. Certain shareholders who are resident in Canada for purposes of the Tax Act and who might not otherwise be considered to hold their Subordinate Voting Shares as capital property may, in certain circumstances, be entitled to have their Subordinate Voting Shares and any other “Canadian security” (as defined in the Tax Act), owned by such holders in the taxation year in which the election is made, and in all subsequent taxation years, treated as capital property by making the irrevocable election permitted by Subsection 39(4) of the Tax Act. Shareholders should consult their own tax advisors regarding the potential application and consequences of this election in their particular circumstances.

This summary is not applicable to a Holder: (i) that is a “financial institution” (as defined in the Tax Act for purposes of the mark-to-market rules); (ii) an interest in which is a “tax shelter investment” (as defined in the Tax Act); (iii) that is a “specified financial institution” (as defined in the Tax Act); (iv) that has made a “functional currency” election under section 261 of the Tax Act; (v) that has received, or receives, Subordinate Voting Shares upon the exercise of an employee stock option, settlement of a restricted stock unit or pursuant to any other employee compensation plan; (vi) that is a corporation resident in Canada and that is, or becomes (or does not deal at arm’s length for purposes of the Tax Act with a corporation resident in Canada that is or becomes), as part of a series of transactions or events, controlled by a non-resident person (or by a group of non-resident persons that do not deal at arm’s length with each other for purposes of the Tax Act) for the purposes of the “foreign affiliate dumping” rules in the Tax Act; (vii) has entered into, or enters into, a “derivative forward agreement” or “synthetic disposition arrangement” (each as defined in the Tax Act) with respect to its Subordinate Voting Shares; (viii) that receives dividends on its Subordinate Voting Shares under, or as part of, a “dividend rental arrangement” (as defined in the Tax Act), (ix) that is exempt from Part I of the Tax Act; or (x) that is a partnership. Such Holders should consult their own tax advisors.

This summary also does not address the tax considerations applicable to holders of stock options, restricted stock units or any other equity-based compensation award. Such holders should consult their own tax advisors.

This summary is based upon the provisions of the Tax Act and the regulations thereunder (the “Tax Regulations”) in force on the date of this Form 10-K and the current published administrative policies and assessing practices of the Canada Revenue Agency (“CRA”) publicly available prior to the date of this Form 10-K. This summary takes into account all specific proposals to amend the Tax Act and the Tax Regulations which have been publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date of this Form 10-K (the “Tax Proposals”) and, except as otherwise noted, assumes that the Tax Proposals will be enacted in their current form. There can be no assurance that any of the Tax Proposals will be implemented in their current form or at all. Except for the Tax Proposals, this summary does not otherwise take into account or anticipate any changes in law, whether by legislative, governmental or judicial decision or action, or changes in the administrative policies or assessing practices of the CRA. In addition, this summary does not take into account other federal or any provincial, territorial or foreign tax legislation or considerations, which may differ significantly from the Canadian federal income tax considerations discussed in this Form 10-K.

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~~For~~ITEM purposes of the Tax Act, all amounts (including amounts related to the acquisition, holding or disposition of Subordinate Voting Shares, such as dividends, adjusted cost base and proceeds of disposition) must be expressed in Canadian dollars using the daily rate of exchange quoted by the Bank of Canada on the date such amounts arose, or such other rate of exchange as is acceptable to the CRA6. ~~The amount of income, capital gains, losses and capital losses may be affected by changes in foreign currency exchange rates.~~[RESERVED]

Verano is a Canadian corporation for purposes of the Tax Act. As referenced under “Certain U.S. Federal Income Tax Considerations,” Verano is also classified as U.S. domestic corporations for United States federal income tax purposes, with related consequences and potential consequences to Verano and its shareholders. Accordingly, all Holders should review the discussion under “Certain U.S. Federal Income Tax Considerations,” and consult with their own tax advisors in this regard. For the purposes of the discussion of Canadian federal income tax considerations below, it has been assumed that Verano is and will be classified as a U.S. domestic corporation for United States federal income tax purposes at all relevant times. No legal opinion or tax ruling has been sought or obtained in this regard or with respect to any other assumptions made for purposes of this summary.

This summary is not exhaustive of all possible Canadian federal income tax considerations applicable to a Holder. The income or other tax consequences will vary depending on the particular circumstances of the Holder, including the province or provinces in which the Holder resides or carries on business. Accordingly, this summary is of a general nature only and is not intended to be, nor should it be construed to be, legal, business or tax advice or representations to any particular Holder. Holders should consult their own legal and tax advisors for advice with respect to the tax considerations described in this Form 10-K based on their particular circumstances.

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~~Resident~~ITEM ~~Shareholders~~7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

~~The~~This ~~following~~discussion ~~portion~~contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those projected, forecasted, or expected in these forward-looking statements as a result of ~~this~~various ~~summary~~factors, isincluding, ~~generally~~but ~~applicable~~not limited to, athose ~~Holder~~discussed ~~who~~below atand ~~all~~elsewhere ~~relevant~~in ~~times~~this Form 10-K. See “Cautionary Note on Forward-Looking Statements” and “Risk Factors” in this Form 10-K. Our management believes the assumptions underlying the Company’s financial statements and accompanying notes are reasonable. However, ~~for~~the ~~purposes~~Company’s financial statements and accompanying notes may not be an indication of our financial condition and results of operations in the ~~Tax~~future. ~~Act~~We have omitted discussion of the earliest of the three years covered by our consolidated financial statements presented in this report because that disclosure was already included in our Annual Report on Form 10-K for the fiscal year ended December 31, is2024, orfiled iswith ~~deemed~~the SEC on February 27, 2025. You are encouraged to bereference ~~resident~~Part inII, ~~Canada~~Item (7, within that report, for a ~~“Resident~~discussion ~~Holder”).~~of our financial condition and result of operations for the fiscal year ended December 31, 2024 compared to the fiscal year ended December 31, 2023.

~~Dividends~~This onmanagement ~~Subordinate~~discussion ~~Voting~~and ~~Shares~~analysis (this “MD&A”) of the financial condition and results of operations of Verano is for the years ended December 31, 2025 and December 31, 2024. It is supplemental to, and should be read in conjunction with, the Company’s audited consolidated financial statements and the accompanying notes for the years ended December 31, 2025 and December 31, 2024. The financial statements referenced in this MD&A are prepared in accordance with U.S. GAAP. Financial information presented in this MD&A is presented in United States dollars (“$” or “US$”) and expressed in thousands, unless otherwise indicated.

A Resident Holder generally will be required to include in computing its income for a taxation year any dividends received or deemed to be received on such Resident Holder’s Subordinate Voting Shares during such taxation year.

In the case of a Resident Holder who is an individual (other than certain trusts), such dividends will be subject to the gross-up and dividend tax credit rules generally applicable to dividends received from “taxable Canadian corporations” (as defined in the Tax Act), including the enhanced gross-up and dividend tax credit if such dividends are designated as “eligible dividends” (as defined in the Tax Act) by Verano. There may be limitations on the ability of Verano to designate dividends as eligible dividends.

In the case of a Resident Holder that is a corporation, the amount of any taxable dividend received or deemed to be received on such Resident Holder’s Subordinate Voting Shares and included in the Resident Holder’s income for the taxation year generally will be deductible in computing the Resident Holder’s taxable income. In certain circumstances, subsection 55(2) of the Tax Act may treat a taxable dividend received by a Resident Holder that is a corporation as proceeds of disposition or a capital gain. Resident Holders that are corporations should consult their own tax advisors having regard to their own circumstances.

A Resident Holder that is a “private corporation” (as defined in the Tax Act) or any other corporation resident in Canada controlled, whether because of a beneficial interest in one or more trusts or otherwise, by or for the benefit of an individual (other than a trust) or a related group of individuals (other than trusts), may be liable under Part IV of the Tax Act to pay an additional tax (refundable in certain circumstances) on dividends received or deemed to be received on the Subordinate Voting Shares to the extent that such dividends are deductible in computing the Resident Holder’s taxable income for the taxation year. A Resident Holder that, is a “Canadian-controlled private corporation” (“CCPC”) (as defined in the Tax Act) throughout the relevant taxation year, or “substantive CCPC” (as defined in the Tax Act) at any time in the relevant taxation year, may be liable to pay an additional tax (refundable in certain circumstances) on its “aggregate investment income” (as defined in the Tax Act), including any dividends received or deemed to be received to the extent that such dividends are not deductible in computing the Resident Holder’s taxable income for the taxation year.

A Resident Holder may be subject to United States withholding tax on dividends received on the Subordinate Voting Shares (see “Certain U.S. Federal Income Tax Considerations”). Any United States withholding tax paid by or on behalf of a Resident Holder in respect of dividends received on the Subordinate Voting Shares by a Resident Holder may be eligible for foreign tax credit or deduction treatment where applicable under the Tax Act. Generally, a foreign tax credit in respect of a tax paid to a particular foreign country is limited to the Canadian tax otherwise payable in respect of income sourced in that country. Dividends received on the Subordinate Voting Shares by a Resident Holder may not be treated as income sourced in the United States for these purposes. Resident Holders should consult their own tax advisors with respect to the availability of any foreign tax credits or deductions under the Tax Act in respect of any United States withholding tax applicable to dividends on the Subordinate Voting Shares.

Disposition of Subordinate Voting Shares

A disposition or deemed disposition of a Subordinate Voting Share by a Resident Holder (except to Verano, unless purchased by Verano in the open market in a manner in which shares are normally purchased by any member of the public in the open market) will generally result in the Resident Holder realizing a capital gain (or capital loss) equal to the amount by which the proceeds of disposition of such Subordinate Voting Shares are greater (or less) than the aggregate of the Resident Holder’s adjusted cost base of such Subordinate Voting Shares and any reasonable costs of disposition. For a description of the treatment of capital gains and capital losses, see “Certain Canadian Federal Income Tax Considerations — Resident Shareholders — Taxation of Capital Gains and Capital Losses” below.

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~~Taxation~~OVERVIEW ofOF ~~Capital~~THE ~~Gains and Capital Losses~~COMPANY

~~Currently,~~Verano ~~one-half~~Holdings ofCorp., ~~any~~a ~~capital~~Nevada ~~gain~~corporation (a“Verano,” the “~~taxable~~Company,” ~~capital~~“we,” ~~gain~~“us,” or “our”), ~~realized~~one byof athe ~~Resident~~U.S. ~~Holder~~cannabis inindustry’s aleading ~~taxation~~companies ~~year~~based ~~must~~on behistorical ~~included~~revenue, ingeographical ~~the~~scope ~~Resident~~and ~~Holder’s~~brand ~~income~~performance, ~~for~~is ~~the~~a ~~year~~vertically integrated, ~~and one~~multi-~~half~~state operator embracing a mission of ~~any~~saying ~~capital~~Yes ~~loss~~to ~~(an~~plant ~~“allowable~~progress ~~capital~~and ~~loss”)~~the ~~realized~~bold byexploration aof ~~Resident~~cannabis. ~~Holder~~As inan aoperator ~~taxation~~of ~~year~~licensed ~~must~~cannabis becultivation, ~~deducted~~processing, ~~from~~wholesale ~~taxable~~distribution ~~capital~~and ~~gains~~retail ~~realized~~facilities, our goal is to support communal wellness by ~~the~~providing ~~Resident~~responsible ~~Holder~~access into ~~that~~regulated ~~year~~medical and adult use cannabis products. ~~Allowable~~As ~~capital~~of ~~losses~~March 10, ~~for~~2026, athrough ~~taxation~~our ~~year~~subsidiaries inand ~~excess~~affiliates ofwe ~~taxable~~operate ~~capital~~businesses ~~gains~~in ~~for~~13 ~~that~~states, ~~year~~including ~~may~~160 ~~generally~~retail bedispensaries ~~carried~~and ~~back~~14 cultivation and ~~deducted~~processing infacilities ~~any~~with over 1.1 million square feet of ~~the~~cultivation ~~three~~capacity. ~~preceding~~We ~~taxation~~produce ~~years,~~a orwide ~~carried~~variety ~~forward~~of ~~and~~cannabis ~~deducted~~products insold ~~any~~under ~~subsequent~~our ~~taxation~~portfolio ~~year~~of consumer brands, ~~against~~including ~~net~~Encore™, ~~taxable~~Avexia™, ~~capital~~MÜV™, ~~gains~~Savvy™, ~~realized~~(the) inEssence™, ~~such~~BITS™, ~~years~~HYPHEN™, toSwift ~~the~~Lifts™ ~~extent~~and Verano™. We also design, build and operate branded dispensaries operating under the ~~circumstances~~Zen ~~specified~~Leaf™ and MÜV™ retail banners, among others, that deliver a cannabis shopping experience in ~~the~~both ~~Tax~~medical ~~Act~~and adult use markets.

~~Under~~Notwithstanding ~~Tax~~the ~~Proposals~~permissive ~~released~~regulatory onenvironment ~~September~~of 23medical, ~~2024~~and in some cases, also adult use (i.e., recreational) cannabis, at the ~~“September~~state 23level, ~~Tax~~it ~~Proposals”)~~remains illegal under U.S. federal law to cultivate, manufacture, distribute, sell or possess cannabis in the ~~capital~~U.S. ~~gains~~Because ~~inclusion~~federal ~~rate~~law ~~would~~prohibits ~~generally~~transporting beany ~~increased~~federally ~~from~~restricted ~~one-half~~substance toacross ~~two-thirds~~state ~~for~~lines, acannabis ~~Resident~~cannot ~~Holder~~be ~~that~~transported isacross astate ~~corporation~~lines. orAs a ~~trust~~result of current federal law prohibitions, ~~and~~the ~~from~~U.S. ~~one-half~~cannabis toindustry ~~two-thirds~~is ~~for~~conducted on a ~~Resident~~state-by-state ~~Holder~~basis. ~~that~~To isdate, anin ~~individual~~the ~~(other~~U.S. ~~than~~40 ~~most~~states ~~types~~plus ofthe ~~trusts)~~District ~~realizing~~of ~~net~~Columbia ~~capital~~and ~~gains~~the ~~above~~U.S. anterritories ~~annual~~of ~~C$250~~Puerto Rico,~~000~~ ~~threshold~~Guam, inthe ~~all~~Commonwealth ~~cases~~of ~~for~~Northern ~~capital~~Marina ~~gains~~Islands, and ~~capital~~the ~~losses~~U.S. ~~realized~~Virgin onIslands orhave ~~after~~authorized ~~June~~comprehensive 25medical cannabis programs, ~~2024.~~24 ~~The~~states ~~September~~plus 23the ~~Tax~~District ~~Proposals~~of ~~also~~Columbia ~~contemplate~~and ~~adjustments~~the U.S. territories of ~~carried~~Guam, ~~forward~~the orCommonwealth ~~carried~~of ~~back~~Northern ~~allowable~~Mariana ~~capital~~Islands, ~~losses~~and tothe ~~account~~U.S. ~~for~~Virgin ~~changes~~Islands inhave ~~the~~authorized ~~relevant~~comprehensive ~~inclusion~~programs ~~rate~~for medical and adult use (i.e. ~~The~~recreational) ~~status~~cannabis, ofand eight states allow the ~~September~~use 23of ~~Tax~~low ~~Proposals,~~THC ~~however,~~and ishigh ~~uncertain~~CBD asproducts ~~Parliament~~for ~~was~~specified ~~prorogued~~medical onuses. ~~January~~Verano 6operates within states where cannabis use, ~~2025~~medical or both medical and adult use, ~~which~~has ~~will~~been ~~delay~~approved ~~any~~by ~~fiscal~~state ~~action~~and onlocal ~~the~~regulatory ~~September~~bodies. 23Strict ~~Tax~~compliance ~~Proposals~~with ~~until~~state atand ~~least~~local ~~March~~laws ~~24,~~with ~~2025~~respect to cannabis may neither absolve the Company of liability under U.S. federal law, ~~when~~nor ~~Parliament~~may isit ~~scheduled~~provide a defense to ~~resume~~any federal proceeding which may be brought against the Company or any of its subsidiaries. On ~~January~~December 3118, 2025, President Trump issued the ~~Minister~~Executive ofOrder ~~Finance~~which ~~(Canada)~~directs ~~announced~~federal ~~that~~agencies to expedite the ~~federal~~process ~~government~~of isrescheduling ~~deferring~~cannabis from a Schedule I to a Schedule III controlled substance under the ~~effective~~CSA. ~~date~~The effect of the ~~September~~Executive 23Order ~~Tax~~may ~~Proposals~~be ~~from~~that ~~June~~the 25cultivation, ~~2024~~manufacturing, todistribution, ~~January~~sale 1,or ~~2026~~possession of cannabis in the U.S. ~~The~~is ~~September~~no 23longer ~~Tax~~federally ~~Proposals~~illegal and would lessen criminal penalties at the federal level and remove Section 280E tax considerations, however, the final effects of the Executive Order are ~~complex~~dependent on other government actions. Despite such actions and ~~may~~the ongoing rule making process, there can be ~~subject~~no toguarantees ~~further~~that ~~changes~~the orrescheduling ~~withdrawal,~~rule ~~and~~making ~~their~~process ~~application~~will tocontinue on a ~~particular~~certain ~~Resident~~timeline ~~Holder~~or at all under this administration or that any rules will ~~depend~~come onout of the rule making process that ~~Resident~~will ~~Holder’s~~benefit ~~particular~~the ~~circumstances~~Company. The ~~Resident~~Executive ~~Holders~~Order, ~~should~~and ~~consult~~agency ~~their~~implementation ~~own~~of ~~tax~~the ~~advisors~~Executive ~~with~~Order ~~respect~~does not federally legalize adult use and would not federally authorize or approve state sanctioned medical programs. Cannabis would still be subject to the ~~September~~same 23FDA ~~Tax~~drug ~~Proposals~~approval process as all other substances, and sales outside of FDA approval, would still be criminal at the federal level.

InSubstantially ~~the~~all ~~case~~ of athe ~~Resident~~Company’s ~~Holder that is a corporation~~business, ~~the~~operating ~~amount~~results ofand ~~any~~financial ~~capital~~condition ~~loss~~relate ~~realized~~to onU.S. acannabis-related ~~disposition~~activities. orOur ~~deemed~~strategy ~~disposition~~is byto ~~the~~vertically ~~Resident~~integrate ~~Holder~~as of a ~~Subordinate~~single ~~Voting~~cohesive ~~Share~~company ~~may~~in bemultiple ~~reduced~~states bythrough the ~~amount~~consolidation of ~~dividends received or deemed~~ seed-to-sale ~~have been received by it on such share (and~~cultivating, ~~in certain circumstances~~manufacturing, ~~a share exchanged for such share)~~distributing, ~~to the extent~~ and ~~under~~dispensing ~~the~~cannabis ~~circumstances~~brands ~~prescribed~~and byproducts ~~the~~at ~~Tax Act~~scale. ~~Similar~~Our ~~rules~~cultivation, ~~may~~processing ~~apply~~and ~~where~~distribution ~~a corporation is a member~~ of acannabis ~~partnership~~consumer orpackaged agoods ~~beneficiary~~are ofdesigned ato ~~trust~~support ~~that~~our ~~owns~~retail ~~such shares~~dispensaries, oras ~~where~~well aas ~~trust~~to ordevelop ~~partnership~~and offoster ~~which~~long aterm ~~corporation~~wholesale issupply arelationships ~~beneficiary~~with orthird-party aretail ~~member~~operators. isOur amodel ~~member~~includes ofestablishing a ~~partnership~~diverse orgeographic afootprint ~~beneficiary of a trust~~ that ~~owns~~allows ~~any~~us ~~such~~to ~~shares.~~adapt ~~Resident Holders~~ to ~~whom~~changes ~~these~~in ~~rules~~both ~~may~~industry beand ~~relevant~~market ~~should consult their own tax advisors~~conditions.

AThe ~~Resident~~United ~~Holder~~States government has recently adopted new approaches to trade policy and has announced tariffs on certain foreign goods and the possibility of significant additional tariff increases or expansions of tariffs. On February 20, 2026, the U.S. Supreme Court ruled that iscertain abroad ~~CCPC~~tariffs ~~(as~~previously ~~defined~~imposed inunder the ~~Tax~~IEEPA ~~Act)~~were ~~throughout~~unauthorized, leading to the ~~relevant~~termination ~~taxation~~of ~~year~~those specific duties. However, orPresident aTrump ~~“substantive~~has ~~CCPC”~~since ~~(as~~invoked ~~defined~~Section in122 of the ~~Tax~~Trade Act) atto ~~any~~impose ~~time~~a innew 15% global import tariff. The timing and scope of further tariffs by the ~~relevant~~United ~~taxation~~States, ~~year~~including potential congressional extensions of the 150-day Section 122 surcharge, ~~may~~and beretaliatory ~~liable~~tariffs by other countries in response to ~~pay~~such antariffs ~~additional~~is ~~tax~~currently ~~(refundable~~uncertain. inSuch ~~certain~~tariffs ~~circumstances)~~and onthe ~~its~~administrative ~~“aggregate~~uncertainty ~~investment~~surrounding ~~income”~~the (transition between different statutory tariff regimes could create supply chain disruptions or increased pricing of procured materials, which could impact our current and expansion strategy as ~~defined~~well inas ~~the~~our ~~Tax~~business, ~~Act)~~operating results and financial condition. See “Risk Factors” in Part I, ~~including~~Item ~~any~~1A ~~taxable~~in ~~capital~~this ~~gains~~Form 10-K.

A Resident Holder may be subject to United States federal income tax on a gain realized on the disposition of a Subordinate Voting Share if Verano is classified as a USRPHC under the Code (see “Certain U.S. Federal Income Tax Considerations”). United States federal income tax, if any, levied on any gain realized on a disposition of a Subordinate Voting Share may be eligible for a foreign tax credit under the Tax Act to the extent and under the circumstances described in the Tax Act. Generally, a foreign tax credit in respect of a tax paid to a particular foreign country is limited to the Canadian tax otherwise payable in respect of income sourced in that country. Gains realized on the disposition of a Subordinate Voting Share by a Resident Holder may not be treated as income sourced in the United States for these purposes. Resident Holders should consult their own tax advisors with respect to the availability of a foreign tax credit, having regard to their own particular circumstances.

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Alternative Minimum Tax

Capital gains realized and taxable dividends received or deemed to be received by a Resident Holder that is an individual (including certain trusts) may affect the Resident Holder’s liability to pay alternative minimum tax under the Tax Act. Resident Holders should consult their own tax advisors with respect to the application of alternative minimum tax.

Eligibility for Investment

The Subordinate Voting Shares are, on the date hereof qualified investments for trusts governed by first home savings accounts (“FHSAs”), registered retirement savings plans (“RRSPs”), registered retirement income funds (“RRIFs”), registered education savings plans (“RESPs”), deferred profit sharing plans, registered disability savings plans (“RDSPs”) and tax-free savings accounts (“TFSAs”), (as those terms are defined in the Tax Act) provided that, on the date hereof, the Subordinate Voting Shares are listed on a “designated stock exchange” (as defined in the Tax Act), which currently includes Cboe Canada.

Notwithstanding that the Subordinate Voting Shares may be qualified investments for a trust governed by a FHSA, TFSA, RDSP, RRSP, RRIF or RESP (each a “Plan”), a holder of a FHSA, TFSA or RDSP, an annuitant under an RRSP or RRIF or a subscriber of an RESP (each a “Plan Holder”) will be subject to a penalty tax if the Subordinate Voting Shares are a “prohibited investment” within the meaning of the Tax Act (as defined in subsection 207.01(1) of the Tax Act) for a Plan. The Subordinate Voting Shares will generally not be a “prohibited investment” for a trust governed by a Plan for purposes of the prohibited investment rules if the Plan Holder deals at arm’s length with the Company for purposes of the Tax Act and does not have a “significant interest” (within the meaning of subsection 207.01(4) of the Tax Act) in the Company. In addition, the Subordinate Voting Shares will not be a “prohibited investment” for a Plan if the Subordinate Voting Shares are “excluded property” (as defined in subsection 207.01(1) of the Tax Act) for such Plan.

Non-Resident Shareholders

The following portion of this summary is generally applicable to a Holder who at all relevant times, for purposes of the Tax Act, (i) is not resident in Canada and is not deemed to be resident in Canada, (ii) does not use or hold, and is not deemed to use or hold, its Subordinate Voting Shares in, or in the course of carrying on, a business in Canada, (iii) is not a person who carries on an insurance business in Canada and elsewhere, (iv) is not an “authorized foreign bank” (as defined in the Tax Act), and (v) is not a “foreign affiliate” (as defined in the Tax Act) of a person resident in Canada (a “Non-Resident Holder”).

Dividends on Subordinate Voting Shares

A Non-Resident Holder will be subject to Canadian withholding tax on the amount of any dividends paid or credited, or deemed to be paid or credited, to it on its Subordinate Voting Shares. Under the Tax Act, the rate of withholding is 25% of the gross amount of the dividend. The withholding rate may be reduced pursuant to the provisions of an applicable income tax treaty or convention. Under the Canada-United States Income Tax Convention (1980), as amended (the “Canada — US Tax Treaty”), the withholding rate on any such dividend beneficially owned by a Non-Resident Holder that is a resident of the United States for purposes of the Canada — US Tax Treaty and fully entitled to the benefits of such treaty is generally reduced to 15%. The Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting of which Canada is a signatory, affects many of Canada’s bilateral tax treaties (but not the Canada-US Tax Treaty), including the ability to claim benefits thereunder. Non-Resident Holders should consult their own tax advisors to determine their entitlement to relief under an applicable income tax treaty or convention. Certain Non-Resident Holders may be subject to United States withholding tax on dividends received on the Subordinate Voting Shares (see “Certain U.S. Federal Income Tax Considerations”).

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Disposition of Subordinate Voting Shares

A Non-Resident Holder will not be subject to Canadian tax in respect of any capital gain realized on the disposition of its Subordinate Voting Shares unless such shares constitute “taxable Canadian property” (as defined in the Tax Act) of the Non-Resident Holder at the time of disposition and the Non-Resident Holder is not entitled to relief under an applicable income tax treaty or convention.

Provided the Subordinate Voting Shares are listed on a “designated stock exchange,” as defined in the Tax Act (which currently includes Cboe Canada), at the time of disposition, a Subordinate Voting Share will generally only be “taxable Canadian property” of a Non-Resident Holder at that time if, at any time during the 60-month period immediately preceding the disposition, the following two conditions were met concurrently: (i) more than 50% of the fair market value of the Subordinate Voting Share was derived directly or indirectly from one or any combination of real or immovable property situated in Canada, “Canadian resource properties” (as defined in the Tax Act), “timber resource properties” (as defined in the Tax Act) and options in respect of, interests in, or for civil law rights in, any such properties whether or not the properties exist; and (ii) one or any combination of the Non-Resident Holder, persons with whom the Non-Resident Holder did not deal at arm’s length or any partnership in which the Non-Resident Holder or persons with whom the Non-Resident Holder did not deal at arm’s length holds a membership interest directly or indirectly through one or more partnerships, owned 25% or more of the issued shares of any class or series of Verano. A Subordinate Voting Share may also be deemed to be “taxable Canadian property” in certain other circumstances.

If the Subordinate Voting Shares are “taxable Canadian property” to a Non-Resident Holder and such Non-Resident Holder is not exempt from Canadian tax in respect of the disposition of such Subordinate Voting Shares pursuant to an applicable income tax treaty or convention, the tax consequences as described above under the headings “Certain Canadian Federal Income Tax Considerations — Resident Shareholders — Taxation of Capital Gains and Capital Losses” will generally apply. Non-Resident Holders whose Subordinate Voting Shares may constitute “taxable Canadian property” should consult their own tax advisors.

CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS

The following is a general summary of certain U.S. federal income tax considerations applicable to a U.S. Holder or a Non-U.S. Holder (each as defined below) arising from the ownership and disposition of Subordinate Voting Shares. This summary is for general information purposes only and does not purport to be a complete analysis or listing of all potential U.S. federal income tax considerations that may apply to a U.S. Holder or Non-U.S. Holder. In addition, this summary does not take into account the individual facts and circumstances of any particular U.S. Holder or Non-U.S. Holder that may affect the U.S. federal income tax consequences to such holder (as discussed below), including specific tax consequences to a holder under an applicable tax treaty. Accordingly, this summary is not intended to be, and should not be construed as, legal or U.S. federal income tax advice with respect to any holder. This summary is limited to U.S. federal income tax considerations, and does not address the U.S. federal alternative minimum, net investment income, U.S. federal estate and gift, U.S. state and local, or non-U.S. tax consequences of the ownership and disposition of such Subordinate Voting Shares. Except as specifically set forth below, this summary does not discuss applicable income tax reporting requirements. Each holder should consult its own tax advisor regarding all U.S. federal, U.S. state and local, and non-U.S. tax consequences of the ownership and disposition of Subordinate Voting Shares.

No opinion from U.S. legal counsel or ruling from the IRS has been requested, or will be obtained, regarding the U.S. federal income tax consequences of the ownership and disposition of Subordinate Voting Shares. This summary is not binding on the IRS, and the IRS is not precluded from taking a position that is different from, and contrary to, the positions taken in this summary. In addition, because the authorities on which this summary is based are subject to various interpretations, the IRS and the U.S. courts could disagree with one or more of the positions taken in this summary.

This summary does not address the U.S. federal income tax consequences to any particular person of the ownership and disposition of Subordinate Voting Shares. Each holder should consult its own tax advisor regarding all U.S. federal, U.S. state and local, and non-U.S. tax consequences of the ownership and disposition of Subordinate Voting Shares.

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Scope of This Disclosure

Authorities

This summary is based on the Code, proposed, final and temporary U.S. Treasury Regulations, published rulings of the IRS, published administrative positions of the IRS, and U.S. court decisions that are applicable and, in each case, as in effect and available, as of the date of this Form 10-K. Any of the authorities on which this summary is based could be changed in a material and adverse manner at any time, and any such change could be applied on a prospective or retroactive basis which could affect the U.S. federal income tax considerations described in this summary. This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted, could be applied on a retroactive or prospective basis.

U.S. Holders

For purposes of this summary, the term “U.S. Holder” means a beneficial owner of Subordinate Voting Shares that is for U.S. federal income tax purposes:

•an individual who is a citizen or resident of the United States;

•a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;

•an estate the income of which is subject to U.S. federal income tax regardless of its source; or

•a trust that (a) is subject to the primary supervision of a court within the United States and the control of one or more U.S. persons for all substantial decisions or (b) has a valid election in effect under applicable U.S. Treasury Regulations to be treated as a U.S. person.

Non-U.S. Holders

Also, for purposes of this discussion, a “Non-U.S. Holder” is any beneficial owner of Subordinate Voting Shares who is neither a U.S. Holder nor an entity classified as a partnership for U.S. federal income tax purposes.

Holders Subject to Special U.S. Federal Income Tax Rules Not Addressed

This summary does not address the U.S. federal income tax consequences of the ownership and disposition of Subordinate Voting Shares that are subject to special provisions under the Code, including holders that: (a) are tax-exempt organizations, qualified retirement plans, individual retirement accounts, or other tax-deferred accounts; (b) are financial institutions, underwriters, insurance companies, real estate investment trusts, or regulated investment companies; (c) are broker-dealers, dealers, or traders in securities or currencies that elect to apply a mark-to-market accounting method; (d) have a “functional currency” other than the U.S. dollar; (e) own, Subordinate Voting Shares as part of a straddle, hedging transaction, conversion transaction, constructive sale, or other arrangement involving more than one position; (f) acquired Subordinate Voting Shares in connection with the exercise of employee stock options or otherwise as compensation for services; (g) hold Subordinate Voting Shares other than as a capital asset within the meaning of Section 1221 of the Code (generally, property held for investment purposes); (h) own, directly, indirectly, or by attribution, 5% or more, by voting power or value, of the outstanding Subordinate Voting Shares; (i) are required to accelerate the recognition of any item of gross income for U.S. federal income tax purposes with respect to Subordinate Voting Shares as a result of such item being taken into account in an applicable financial statement; (j) acquired Subordinate Voting Shares by gift or inheritance; (k) are certain former citizens or long-term residents of the United States; (l) are pension plans; (m) are integral parts or controlled entities of foreign sovereigns; or (n) are passive foreign investment companies and corporations that accumulate earnings to avoid U.S. federal income tax. Holders that are subject to special provisions under the Code, including those holders described immediately above, should consult their own tax advisors regarding all U.S. federal, U.S. state and local, and non-U.S. tax consequences relating to the ownership and disposition of Subordinate Voting Shares.

If an entity or arrangement that is classified as a partnership (including any other “pass-through” entity) for U.S. federal income tax purposes holds Subordinate Voting Shares, the U.S. federal income tax consequences to such partnership and the partners (or owners) of such partnership of participating in the ownership and disposition of Subordinate Voting Shares generally will depend on the activities of the partnership and the status of such partners (or owners). This summary does not address the tax consequences to any such partnership or partner (or owner). Partners (or owners) of entities and arrangements that are classified as partnerships for U.S. federal, U.S. state and local, and non-tax purposes should consult their own tax advisors regarding the U.S. federal income tax consequences of the ownership and disposition of Subordinate Voting Shares.

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U.S. Tax Classification of Verano

Pursuant to Section 7874(b) of the Code and the U.S. Treasury Regulations promulgated thereunder, notwithstanding that Verano has been organized under Canadian law, solely for U.S. federal income tax purposes, Verano is classified as a U.S. domestic corporation. Accordingly, Verano will be subject to a number of significant and complicated U.S. federal income tax consequences as a result of being treated as a U.S. domestic corporation for U.S. federal income tax purposes and will be subject to taxation both in Canada and the United States.

U.S. Tax Considerations Relevant to the Ownership and Disposition of Subordinate Voting Shares for U.S. Holders

Distributions

We do not currently anticipate paying distributions on our Subordinate Voting Shares. If Verano makes distributions with respect to a Subordinate Voting Share, the distributions generally will be treated as U.S. source dividends to a U.S. Holder of a Subordinate Voting Share to the extent of Verano’s current and accumulated earnings and profits as determined under U.S. federal income tax principles at the end of the tax year in which the distribution occurs. To the extent the distributions exceed Verano’s current and accumulated earnings and profits, the excess will be treated first as a tax-free return of capital to the extent of the U.S. Holder’s adjusted tax basis in the Subordinate Voting Share, and thereafter as gain from the sale or exchange of that Subordinate Voting Share. Corporate U.S. Holders may be entitled to claim the dividends-received deduction with respect to dividends paid on the Subordinate Voting Shares, and such dividends may constitute qualified dividend income to individual U.S. Holders, subject in each case to applicable restrictions and eligibility requirements.

Dividends on the Subordinate Voting Shares will not constitute foreign source income for U.S. foreign tax credit limitation purposes because Verano, even though organized as a Canadian corporation, will be treated as a U.S. corporation for U.S. federal income tax purposes, as described above under “— U.S. Tax Classification of Verano.” Therefore, a U.S. Holder may not be able to claim a U.S. foreign tax credit for any Canadian tax unless the U.S. Holder has sufficient other foreign source income. However, if the U.S. Holder has not elected to credit other foreign taxes during the same taxable year, the U.S. Holder should be able to take a deduction for such Canadian tax.

Sale, Exchange or Other Taxable Disposition of Subordinate Voting Shares

Upon the sale or other taxable disposition of a Subordinate Voting Share, U.S. Holders generally will recognize capital gain or loss equal to the difference between the amount realized by such holders on the disposition and their adjusted tax basis in such Subordinate Voting Share. Such gain or loss generally will be long-term capital gain or loss if the U.S. Holder held, or is treated as having held, such Subordinate Voting Share for more than one year as of the time of disposition. Long-term capital gains of individuals are currently eligible for reduced rates of taxation. The deductibility of capital losses is subject to limitations.

To the extent a sale or other taxable disposition of the Subordinate Voting Shares by a U.S. Holder results in Canadian tax payable by the U.S. Holder, such U.S. Holder may not be able to claim a U.S. foreign tax credit for any Canadian tax unless the U.S. Holder has sufficient other foreign source income. However, if the U.S. Holder has not elected to credit other foreign taxes during the same taxable year, the U.S. Holder should be able to take a deduction for such Canadian tax.

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U.S. Tax Considerations Relevant to the Ownership and Disposition of Subordinate Voting Shares for Non-U.S. Holders

Distributions

If Verano makes distributions with respect to a Subordinate Voting Share, the distributions generally will be treated as dividends to a Non-U.S. Holder of a Subordinate Voting Share to the extent of Verano’s current and accumulated earnings and profits as determined under U.S. federal income tax principles at the end of the tax year in which the distribution occurs. To the extent the distributions exceed Verano’s current and accumulated earnings and profits, the excess will be treated first as a tax-free return of capital to the extent of the Non-U.S. Holder’s adjusted tax basis in the Subordinate Voting Share, and thereafter as gain from the sale or exchange of that Subordinate Voting Share.

Gain from the sale or exchange a Subordinate Voting Share that is effectively connected with the conduct of a trade or business by a Non-U.S. Holder within the United States (and, if an applicable tax treaty so requires, is attributable to a U.S. permanent establishment or fixed base maintained by the Non-U.S. Holder) will be subject to tax at generally applicable U.S. federal income tax rates. A Non-U.S. Holder that is a foreign corporation may also be subject to an additional “branch profits tax” on any such gain at a 30% rate (or lower applicable treaty rate).

Gain recognized by a Non-U.S. Holder who is an individual present in the United States for 183 days or more in the taxable year of disposition, and who meets certain other conditions, generally will be subject to a flat 30% U.S. federal income tax. Non-U.S. Holders are urged to consult their own tax advisors regarding possible eligibility for benefits under income tax treaties and the availability of U.S. source capital losses to offset any such gain.

Dividends paid to a Non-U.S. Holder generally will be subject to U.S. withholding tax at a rate of 30% of the gross amount unless the Non-U.S. Holder is eligible for and properly claims a reduced rate of withholding under an applicable income tax treaty. However, dividends that are effectively connected with the conduct of a trade or business by the Non-U.S. Holder within the United States (and, if required by an applicable income tax treaty, are attributable to a U.S. permanent establishment of the Non-U.S. Holder) will not be subject to U.S. withholding tax, unless Verano is classified as a USRPHC, provided certain certification and disclosure requirements are satisfied. Instead, such dividends are subject to U.S. federal income tax on a net income basis in the same manner as if the Non-U.S. Holder were a U.S. Holder. Any such effectively connected dividends received by a foreign corporation may be subject to an additional “branch profits tax” equal to 30% of its effectively connected earnings and profits (subject to certain adjustments) or at such lower rate as may be specified by an applicable income tax treaty. A Non-U.S. Holder eligible for a reduced rate of U.S. withholding tax pursuant to an income tax treaty may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS.

Verano believes that it presently is not a USRPHC and it does not presently anticipate that it will become a USRPHC. However, if Verano is treated as a USRPHC, gain recognized by such holder on the sale, taxable exchange or other disposition of Subordinate Voting Shares will be subject to tax at generally applicable U.S. federal income tax rates if Verano is or has been a USRPHC for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of disposition or the period that the Non-U.S. Holder held the Subordinate Voting Shares, and, in the case where the Subordinate Voting Shares are regularly traded on an established securities market, the Non-U.S. Holder has owned, directly or constructively, more than 5% of Subordinate Voting Shares at any time within the shorter of the five-year period preceding the disposition or such Non-U.S. Holder’s holding period for the Subordinate Voting Shares. There can be no assurance that the Subordinate Voting Shares will be treated as regularly traded on an established securities market for this purpose. In addition, Verano may be required to withhold U.S. income tax at a rate of 15% of the amount realized upon such disposition. You are urged to consult your own tax advisors regarding the application of these rules.

Sale, Exchange or Other Taxable Disposition of Subordinate Voting Shares

A Non-U.S. Holder that disposes of its Subordinate Voting Shares in a taxable disposition generally will subject to the tax treatment described above in “— U.S. Tax Considerations Relevant to the Ownership and Disposition of Subordinate Voting Shares for Non-U.S. Holders — Distributions”.

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Foreign Account Tax Compliance Withholding

Under the Foreign Account Tax Compliance Act (“FATCA”), a 30% withholding tax may apply to payments of dividends on stock made to foreign financial institutions (including amounts paid to a foreign financial institution on behalf of a holder) and certain other non-financial foreign entities. Additionally, a 30% withholding tax may apply to payments of gross proceeds from the disposition of stock made to such institutions and entities; however, proposed Treasury Regulations eliminate this 30% withholding tax on payments of gross proceeds. Taxpayers may rely on these proposed Treasury Regulations until final Treasury Regulations are issued. There can be no assurance that final Treasury Regulations would provide an exemption from FATCA for gross proceeds.

Withholding under FATCA generally will not apply where such payments are made to (i) a foreign financial institution that undertakes, under either an agreement with the United States Treasury or pursuant to an intergovernmental agreement between the jurisdiction in which it is a resident and the United States Treasury, to identify accounts held by certain United States persons or United States-owned foreign entities, annually report certain information about such accounts, and withhold 30% on payments to noncompliant foreign financial institutions and certain other account holders; (ii) a non-financial foreign entity that either certifies it does not have any substantial United States owners or furnishes identifying information regarding each substantial United States owner to the United States Treasury; or (iii) a foreign financial institution or non-financial foreign entity that is exempt from these rules. Investors should consult their tax advisors regarding this legislation and the regulations thereunder.

Information Reporting and Backup Withholding

Payments of dividends or of proceeds on the disposition of Subordinate Voting Shares to U.S. Holders may be subject to information reporting and backup withholding unless the U.S. Holder (i) is a corporation or comes within certain other exempt categories and demonstrates this fact, or (ii) provides a correct taxpayer identification number, certifies as to no loss of exemption from backup withholding and otherwise complies with applicable requirements of the backup withholding rules. Non-U.S. Holders may be required to provide documentary evidence establishing they are not subject to information reporting and backup withholding. Payments of dividends to Non-U.S. Holders and the amount of U.S. federal withholding tax imposed on such dividends must generally be reported annually to the IRS. A similar report will be sent to Non-U.S. Holders. Copies of these reports may be made available to tax authorities in a holder’s country of residence.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules will be allowed as a refund or a credit against a holder’s U.S. federal income tax liability, provided the required information is furnished to the IRS on a timely basis.

ITEM 6. [RESERVED]

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ITEM 7. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those projected, forecasted, or expected in these forward-looking statements as a result of various factors, including, but not limited to, those discussed below and elsewhere in this Form 10-K. See “Cautionary Note on Forward-Looking Statements” and “Risk Factors” in this Form 10-K. Our management believes the assumptions underlying the Company’s financial statements and accompanying notes are reasonable. However, the Company’s financial statements and accompanying notes may not be an indication of our financial condition and results of operations in the future. We have omitted discussion of the earliest of the three years covered by our consolidated financial statements presented in this report because that disclosure was already included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 15, 2024. You are encouraged to reference Part II, Item 7, within that report, for a discussion of our financial condition and result of operations for the fiscal year ended December 31, 2022 compared to the fiscal year ended December 31, 2023.

This management discussion and analysis (this “MD&A”) of the financial condition and results of operations of Verano is for the years ended December 31, 2024 and December 31, 2023. It is supplemental to, and should be read in conjunction with, the Company’s audited consolidated financial statements and the accompanying notes for the years ended December 31, 2024 and December 31, 2023. The financial statements referenced in this MD&A are prepared in accordance with U.S. GAAP. Financial information presented in this MD&A is presented in United States dollars (“$” or “US$”) and expressed in thousands, unless otherwise indicated.

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OVERVIEW OF THE COMPANY

Verano, one of the U.S. cannabis industry’s leading companies based on historical revenue, geographical scope and brand performance, is a vertically integrated, multi-state operator embracing a mission of saying Yes to plan progress and the bold exploration of cannabis. An operator of licensed cannabis cultivation, processing, wholesale distribution and retail facilities, our goal is the ongoing development of communal wellness by providing responsible access to regulated medical and adult use cannabis products to discerning customers. As of February 25, 2025, through our subsidiaries and affiliates we operate businesses in 13 states, including 153 retail dispensaries and 15 cultivation and processing facilities with over 1.1 million square feet of cultivation capacity. We produce a wide variety of high quality cannabis products sold under our portfolio of consumer brands, including Encore™, Avexia™, MÜV™, Savvy™, (the) Essence™, BITS™ and Verano™. We also design, build and operate branded retail environments including Zen Leaf™ and MÜV™ dispensaries that deliver a cannabis shopping experience in both medical and adult use markets.

Our strategy is to vertically integrate as a single cohesive company in multiple states through the consolidation of seed-to-sale cultivating, manufacturing, distributing, and dispensing cannabis brands and products at scale. Our cultivation, processing and wholesale distribution of cannabis consumer packaged goods are designed to guarantee shelf-space in our national retail dispensary chains, as well as to develop and foster long term wholesale supply relationships with third-party retail operators. Our model includes geographic diversity by establishing a footprint to allow us to adapt to changes in both industry and market conditions.

As part of the Go Public Transactions described in “Item 1. Business – History of the Company,” in February 2021, the Company resulted from a reverse takeover transaction.

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SELECTED RESULTS OF OPERATIONS

The following presents selected financial data derived from the audited consolidated financial statements for the years ended December 31, ~~2024~~2025 and ~~2023~~2024. The selected consolidated financial information below may not be indicative of the Company’s future performance.

Year Ended December 31, ~~2024~~2025, as Compared to Year Ended December 31, ~~2023~~2024

For the Years Ended December 31,

($ in thousands)

~~2024~~2025

~~2023~~2024

$ Change

Revenues, net of Discounts

~~878~~821,~~585~~504

~~938~~878,~~452~~585

(5957,~~867~~081)

Gross Profit

~~443~~413,~~931~~497

~~475~~443,~~206~~931

(3130,~~275~~434)

Net Loss attributable to Verano Holdings Corp. & Subsidiaries

(~~341~~257,~~859~~908)

(~~117~~341,~~348~~859)

~~(224~~83,~~511)~~951

Net Loss per share – basic & diluted

(0.9871)

(0.3498)

(0.~~64)~~27

Revenues, net of Discounts

Revenues, net of discounts for the year ended December 31, ~~2024~~2025 was $~~878~~821,~~585~~504, a decrease of $(5957,~~867~~081) or (6.45)%, compared to revenues, net of discounts of $~~938~~878,~~452~~585 for the year ended December 31, ~~2023~~2024. The year-over-year decrease in revenues, net of discounts, ~~that the Company experienced~~ was ~~caused by a decrease in retail revenues, net of discounts, which was~~ driven primarily by ~~continued expected declines in New Jersey and Illinois retail markets as~~ third-party ~~dispensaries~~price ~~continue~~compression toin ~~open~~established ~~across~~markets ~~the~~coupled ~~states~~with ~~during~~ the ~~year~~Company's ~~ended~~accounts ~~December 31,~~receivable ~~2024.~~strategy ~~Additionally, revenues, net of discounts,~~ in the ~~Florida~~cultivation ~~market~~(wholesale) ~~decreased~~segment, ~~year-over~~of ~~year~~maintaining ~~due~~a tonumber ~~cultivation~~of ~~and~~accounts ~~process~~on ~~facility~~hold ~~enhancements~~for ~~that temporarily reduced production~~non-payment. This iswas partially offset by ~~increases~~an increase in the retail segment revenues, net of discounts, ~~from~~driven ~~the~~by ~~Maryland~~product ~~and~~availability ~~Ohio~~in ~~markets~~the inFlorida ~~relation~~market toand the ~~adult~~acquisition ~~use~~of ~~program~~CC ~~launches~~East inVirginia ~~July~~and ~~2023~~Cannabist ~~and~~AZ in August 2024, ~~respectively,~~which ~~and~~increased ~~acquisition activity during~~ the ~~year~~Company’s ~~ended~~retail ~~December 31, 2024~~footprint. During the year ended December 31, ~~2024~~2025, the Company opened ~~nine~~seven new retail stores, ~~one~~two in Connecticut, ~~six~~three in Florida, one in ~~New~~Ohio ~~Jersey~~ and one in ~~Pennsylvania.~~West ~~Additionally, the Company acquired eight additional retail stores, two in Arizona and six in~~ Virginia~~, as part of acquisition activity during the third quarter of 2024~~. Consistent with other multi-state cannabis operators, the Company has continued to see increased competition and promotional activity in select retail markets, specifically in New Jersey and Illinois during the year ended December 31, 2024 compared to the year ended December 31, 2023. Retail revenues, net of discounts, for the year ended December 31, ~~2024~~2025 comprised 6567.59% of revenues, net of discounts, compared to 6865.05% of revenues, net of discounts, for the year ended December 31, ~~2023~~2024, excluding intersegment eliminations. The Company experienced an increase in cultivation (wholesale) revenues, net of discounts, driven by increased third-party wholesale sales in the New Jersey and Illinois markets, coupled with the adult use launch in the Ohio market, both of which attributed to increased production output and sales of cannabis flower and cannabis related products, when comparing the year ended December 31, 2024 to the year ended December 31, 2023. Cultivation (wholesale) revenues, net of discounts, made up 3432.51% of revenues, net of discounts for the year ended December 31, ~~2024~~2025, as compared to 3234.05% for the year ended December 31, ~~2023~~2024, excluding intersegment eliminations. Please see “Results of Operations by Segment” for information regarding year over year performance of our retail revenue and cultivation (wholesale) revenues.

Gross Profit

Gross profit for the year ended December 31, ~~2024~~2025 was $~~443~~413,~~931~~497, representing a gross profit margin of 50.53%. This is compared to gross profit for the year ended December 31, ~~2023~~2024 of $~~475~~443,~~206~~931, representing a 50.65% gross profit margin. The slight decrease was ~~attributable~~primarily todriven anby ~~impact~~overall ~~related to an inventory step~~top-upline ~~from~~revenue ~~acquisitions,~~decline coupled with, ~~continued~~increased ~~pricing~~promotional ~~pressure~~activity ~~during~~in ~~the~~established ~~year~~markets, ~~ended~~partially ~~December 31,~~offset ~~2024 when~~by ~~compared to~~more ~~the~~efficient ~~year~~harvests ~~ended~~from ~~December 31,~~expanded ~~2023~~cultivation facilities.

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Net Loss

Net Loss attributable to ~~Verano Holdings Corp. and its Subsidiaries, or~~ the Company for purposes of this “Management’s Discussion and Analysis”, for the year ended December 31, ~~2024~~2025, was $(~~341~~257,~~859~~908) ana ~~increase~~decrease of $~~224~~83,~~511~~951, compared to a Net Loss of $(~~117~~341,~~348~~859) for the year ended December 31, ~~2023~~2024. The ~~increase~~decrease in ~~Net~~net ~~Loss~~loss year-over-year was ~~largely~~ attributable to ~~intangible~~lower ~~asset~~comparative ~~impairment~~impairments charges of (i) $293,688 related to the Company’s Pennsylvania retail licenses, (ii) $5,687 related to the Company’s Arizona cultivation (wholesale) tradenames, (iii) $34 related to the Company’s Maryland retail tradenames; and ~~(iv)~~lower ~~$425~~operating ~~related to the Company’s Arizona cultivation (wholesale) technology~~expenses, on the remaining net book value during the year ended December 31, 2024. Additionally, during the year ended December 31, 2024, the Company recorded (i) a fixed asset impairment charge of $10,526 associated with an Arizona cultivation facility, (ii) an impairment on a held-for-sale asset related to a cultivation facility in Pennsylvania of $9,160 as the carrying value exceeded the fair value less cost to sell by such amount; and (iii) a goodwill impairment charge of $8,179 associated with its Arizona cultivation (wholesale) reporting unit. This is partially offset by ~~lower~~a higher provision for income taxes for the year ended December 31, ~~2024~~2025, when compared to the year ended December 31, ~~2023~~2024.

	For the Years Ended December 31,
($ in thousands)	2024		2023		$ Change
Cost of Goods Sold, net	$	434,654	$	463,246	$	(28,592)
Selling, General, and Administrative Expenses	353,408		331,928		21,480
Loss on Impairment of Investment in Associates	—		6,571		(6,571)
Loss on Impairment of Intangibles — Goodwill	8,179		37,931		(29,752)
Loss on Impairment of Intangibles & Fixed Assets	319,520		13,686		$	305,834
Other Income (Expense), net	(62,739)		(56,986)		(5,753)
Provision for Income Taxes	(41,944)		(145,146)		103,202

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	For the Years Ended December 31,
($ in thousands)	2025		2024		$ Change
Cost of Goods Sold, net	$	408,007	$	434,654	$	(26,647)

Total Operating Expenses	520,590		681,107		(160,517)

Other Income (Expense), net	(59,137)		(62,739)		3,602

Provision for Income Taxes	(91,678)		(41,944)		(49,734)

Cost of Goods Sold, net

Cost of goods sold, net includes the costs directly attributable to ~~cultivating~~product sales and ~~processing~~includes ~~cannabis~~amounts ~~and~~paid for ~~retail purchases of~~ finished goods, such as flower, edibles, and concentrates, as well as packaging and other supplies, fees for services and processing, rent, utilities, and related costs. Cost of goods sold, net, for the year ended December 31, ~~2024~~2025 was $~~434~~408,~~654~~007, a decrease of $(2826,~~592~~647) or (6.21)%, from the year ended December 31, ~~2023~~2024. The decrease was primarily driven by aoverall decline in ~~revenues, net of discounts, within the retail markets due to expected declines in the New Jersey and Illinois markets as third~~top-~~party~~line ~~dispensaries~~revenue ~~continue~~coupled towith ~~open~~more ~~across~~efficient ~~the~~harvests ~~states,~~from ~~driving~~expanded ~~increased~~cultivation ~~competition~~facilities. Additionally, the ~~Company~~decrease ~~recorded~~was aalso ~~$3,846~~attributable ~~non-cash impact related~~ to ~~the~~third ~~inventory~~party ~~step-up~~price ~~from~~compression ~~acquisitions~~in ~~during~~ the ~~year~~cultivation ~~ended~~(wholesale) ~~December 31, 2024~~segment.

~~Selling,~~Total ~~General,~~Operating ~~and Administrative~~ Expenses

~~Selling,~~Total ~~general~~operating ~~and administrative~~ expenses ~~(“SG&A”)~~ for the year ended December 31, ~~2024~~2025 were $~~353~~520,~~408~~590, ana ~~increase~~decrease of $21(160,~~480~~517) or 6(23.56)%, compared to ~~selling,~~total ~~general~~operating ~~and administrative~~ expenses of $~~331~~681,~~928~~107 for the year ended December 31, ~~2023~~2024. ~~SG&A~~For ~~expenses as a percentage of revenues, net of discounts, was 40.2% and 35.4% for~~ the years ended December 31, ~~2024~~2025 and ~~2023~~December 31, ~~respectively.~~2024, ~~The~~total ~~year~~operating ~~over~~expenses ~~year~~included ~~increase was attributable to a $9~~selling,~~350~~ ~~increase in~~ general and administrative expenses ~~driven~~(“SG&A”), byimpairments ~~enhancements~~of inintangibles ~~processes~~- ~~and~~goodwill ~~technology~~ and aimpairments ~~$13~~of intangibles,~~876~~ ~~increase~~fixed inassets ~~salaries~~ and ~~benefits~~held ~~due to increased headcounts related to new store openings and acquisition activity~~ for ~~the~~sale ~~year ended December 31, 2024~~assets.

91SG&A expenses as a percentage of revenues, net of discounts, was 41.1% and 40.2% for the years ended December 31, 2025 and 2024, respectively. The year over year decrease in SG&A was driven by a decrease in depreciation and amortization expense coupled with ongoing efficiencies generated across the business for the year ended December 31, 2025 when compared to the year ended December 31, 2024.

During the year ended December 31, 2025, the Company recorded goodwill impairment charges of (i) $40,827 associated with its Connecticut cultivation (wholesale) reporting unit, (ii) $35,649 associated with its Illinois retail reporting unit, (iii) $8,377 associated with its Connecticut retail reporting unit, and (iv) $1,738 associated with its Arizona retail reporting unit, as the carrying values of the reporting units exceeded the estimated fair value by such amounts. Comparatively, during the year ended December 31, 2024, the Company recognized impairment charges of $8,179 associated with its Arizona cultivation (wholesale) reporting unit.

During the year ended December 31, 2025, the Company determined that a license associated with its Pennsylvania cultivation (wholesale) reporting unit was impaired and as such, the Company recorded intangible asset impairment charges of $90,849. Additionally, during the year ended December 31, 2025 the Company recorded a fixed asset impairment charge of $428 associated with a Massachusetts cultivation facility as the carrying value exceeded the fair value by such amount and an impairment charge of $5,400 resulting from a reduction in the carrying value of a cultivation facility in Pennsylvania. Comparatively, during the year ended December 31, 2024, the Company recorded intangible asset impairment charges of (i) $293,688 related to the Company’s Pennsylvania retail licenses, (ii) $5,687 related to the Company’s Arizona cultivation (wholesale) tradenames, (iii) $34 related to the Company’s Maryland retail tradenames; and (iv) $425 related to the Company’s Arizona cultivation (wholesale) technology, on the remaining net book value. Additionally, during the year ended December 31, 2024, the Company recorded a fixed asset impairment charge of $10,526 associated with an Arizona cultivation facility, and an impairment on a held-for-sale asset related to a cultivation facility in Pennsylvania of $9,160 as the carrying value exceeded the fair value less cost to sell by such amount.

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Loss on Impairment of Investment in Associates

During the year ended December 31, 2023, the Company received notification that the DGV Group, LLC ("DGV"), an entity in which the Company held an equity interest, was permanently ceasing operations. The Company recorded an impairment loss for the full value of the equity method investment of $6,571 as DGV was previously held as an Investment in Associates on the Company’s Consolidated Balance Sheets. No such impairment charges were recorded during the year ended December 31, 2024.

Loss on Impairment of Intangibles - Goodwill, License & Fixed Assets

During the year ended December 31, 2024, the Company recorded intangible asset impairment charges of (i) $293,688 related to the Company’s Pennsylvania retail licenses, (ii) $5,687 related to the Company’s Arizona cultivation (wholesale) tradenames, (iii) $34 related to the Company’s Maryland retail tradenames; and (iv) $425 related to the Company’s Arizona cultivation (wholesale) technology, on the remaining net book value during the year ended December 31, 2024. Additionally, during the year ended December 31, 2024, the Company recorded (i) a fixed asset impairment charge of $10,526 associated with an Arizona cultivation facility, (ii) an impairment on a held-for-sale asset related to a cultivation facility in Pennsylvania of $9,160 as the carrying value exceeded the fair value less cost to sell by such amount; and (iii) a goodwill impairment charge of $8,179 associated with its Arizona cultivation (wholesale) reporting unit. During the year ended December 31, 2023, the Company recorded an intangible asset impairment charge of $5,113 on the remaining net book value related to the Company’s Massachusetts cultivation (wholesale) license, a fixed asset impairment charge of $8,573 related to the Company’s Massachusetts cultivation facility, and goodwill impairment charges of (i) $33,622 associated with its Arizona cultivation (wholesale) reporting unit, (ii) $4,245 associated with its Nevada retail reporting unit, and (iii) $64 associated with its Massachusetts cultivation (wholesale) reporting unit, as the carrying values of the reporting units exceeded the estimated fair value by such amounts.

Other Income (Expense), net

Other income (expense), net for the year ended December 31, ~~2024~~2025 was $(6259,~~739~~137), ana ~~increase~~change of $53,~~753~~602, as compared to other income (expense), net of $(62,739) for the year ended December 31, ~~2023~~2024. The ~~increase~~change in other income (expense), net, during the year ended December 31, ~~2024~~2025 was ~~mainly~~attributable ~~due~~ to the voluntary partial payoff agreement for the CC East Virginia Promissory Note resulting in a ~~loss~~Gain on ~~debt~~Debt ~~extinguishment~~Extinguishment ~~attributable~~partially offset by a Loss on Debt Extinguishment related to the Permitted Partial Optional Prepayment under the 2022 Credit Agreement and a loss of $10,000 related to a litigation settlement. Additionally, the ~~Company's~~total ~~contributions~~other income (expense), net variance was attributable to ~~Florida~~less interest expense on our debt obligations coupled with a Gain on Deconsolidation relating to our Arkansas operations during January 2025, which no longer met the criteria for consolidation as a result of termination of contracts providing us with control over the applicable entity's ~~Smart~~operations, &when ~~Safe~~comparing ~~adult-use~~the ~~legalization~~year ~~campaign~~ended ~~when~~December 31, ~~compared~~2025 to the year ended December 31, ~~2023~~2024.

Provision for Income Taxes

Provision for income taxes for the year ended December 31, ~~2024~~2025 was $4191,~~944~~678, aan ~~decrease~~increase of $~~103~~49,~~202~~734 or 71118.16% as compared to the year ended December 31, ~~2023~~2024. The ~~increase~~year-over-year change in income tax expense was primarily driven by impacts from impairment losses recognized in each respective period. For the year ended December 31, 2024, the provision for income taxes was ~~largely~~mainly ~~attributable~~impacted toby the ~~Loss~~loss on ~~Impairment~~impairment of ~~Intangibles~~intangibles &and ~~Fixed~~fixed ~~Assets~~assets. In contrast, for the year ended December 31, ~~2023~~2025, the provision reflected lower impairment losses on intangibles, fixed assets, and assets held for sale. The variation in the amounts of impairment charges between the two years resulted in the comparative fluctuation in income tax expense.

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Results of Operations by Segment

The Company has two reportable segments: (i) cultivation (wholesale) and (ii) retail. Due to the vertically integrated nature of our business, the Company reviews revenue at the cultivation (wholesale) and retail levels while reviewing operating results on a consolidated basis.

The following tables summarize revenues, net of discounts, by segment for the years ended December 31, ~~2024~~2025 and ~~2023~~2024:

For the Years Ended December 31,

($ in thousands)

~~2024~~2025

~~2023~~2024

$ Change

% Change

Revenues, net of Discounts

Cultivation (Wholesale)

~~353~~318,~~476~~389

~~348~~353,~~990~~476

4(35,~~486~~087)

1(9.39)

Retail

672,~~252~~661

~~741~~672,~~334~~252

~~(69,082)~~409

(90.3)1

Intersegment Eliminations

(~~147~~169,~~143~~546)

(~~151~~147,~~872~~143)

4(22,~~729~~403)

(315.1)2

Total Revenues, net of Discounts

~~878~~821,~~585~~504

~~938~~878,~~452~~585

(5957,~~867~~081)

(6.45)

Revenues, net of discounts, for the cultivation (wholesale) segment was $~~353~~318,~~476~~389 for the year ended December 31, ~~2024~~2025, ana ~~increase~~decrease of $4(35,~~486~~087) or 1(9.39)%, excluding intersegment eliminations, compared to the year ended December 31, ~~2023~~2024. ~~The~~Markets ~~increase~~that inwere top contributors to the cultivation (wholesale) revenues, net of discounts, ~~was~~were ~~driven~~Illinois byand ~~increased~~New ~~third-party~~Jersey ~~wholesale~~during ~~sales~~the year ended December 31, 2025. The decrease in ~~the~~cultivation ~~New~~(wholesale) ~~Jersey~~revenues, ~~and~~net ~~Illinois~~of ~~markets~~discounts, ~~coupled~~was ~~with~~primarily attributable to the ~~adult~~expected ~~use~~third-party ~~launch~~price compression in established markets coupled with the ~~Ohio~~Company's ~~market,~~accounts ~~both~~receivable strategy, of which ~~attributed~~was to ~~increased~~maintain ~~production~~a ~~output~~number ~~and sales~~ of ~~cannabis~~accounts ~~flower~~on ~~and~~hold ~~cannabis~~for ~~related~~non-payment ~~products,~~ when comparing the year ended December 31, ~~2024~~2025 to the year ended December 31, ~~2023~~2024. Additionally, the wholesale market experienced a strategic shift in third-party distribution, specifically in Connecticut and Pennsylvania market, with growing emphasis on vertical distribution channels through direct retail dispensaries.

Revenues, net of discounts, for the retail segment was $672,~~252~~661 for the year ended December 31, ~~2024~~2025, aan ~~decrease~~increase of $~~(69,082)~~409 or (90.3)1%, excluding intersegment eliminations, compared to the year ended December 31, ~~2023~~2024. Top contributors to retail ~~sales~~revenues, ~~were~~net ~~mainly~~of ~~due to increases in Maryland and Ohio retail markets due to the adult use program launches in July 2023 and August 2024~~discounts, ~~respectively, and acquisition activity~~ during the year ended December 31, ~~2024.~~2025, ~~The~~were ~~overall~~mainly ~~decrease~~ in ~~retail~~the ~~revenues~~Florida, ~~net~~New ofJersey ~~discounts,~~and ~~was~~Illinois ~~primarily~~markets ~~driven~~coupled bywith ~~continued~~the ~~increased~~acquisition ~~competition~~of ~~and~~CC ~~promotional~~East ~~activity,~~Virginia asand ~~expected,~~Cannabist AZ in ~~select~~August ~~retail markets~~2024, ~~specifically~~which inincreased ~~New~~the ~~Jersey~~Company’s ~~and~~retail ~~Illinois~~footprint. ~~Additionally~~In addition, ~~modest~~when ~~pricing~~comparing ~~pressure~~the ~~and~~year ~~promotional~~ended ~~activity~~December 31, ~~contributed~~2025 to the ~~decrease~~year ended December 31, 2024, the increase in retail revenues, net of discounts, ~~when~~was ~~comparing~~driven ~~the~~by ~~year~~product ~~ended~~availability ~~December 31,~~in ~~2024 to~~ the ~~year~~Florida ~~ended December 31, 2023~~market.

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Drivers of Operational Performance

Revenue

The Company derives its revenue from both its cultivation (wholesale) business in which it cultivates, produces and sells cannabis products to third-party retail customers, and its retail business, in which it directly sells cannabis products to retail patients and consumers. For the year ended December 31, ~~2024~~2025, approximately 3432.51% of the Company’s revenue was generated from the cultivation (wholesale) business and approximately 6567.59% from the retail business, excluding intersegment eliminations. For the year ended December 31, ~~2023~~2024, approximately 3234.05% of the Company’s revenue was generated from the cultivation (wholesale) business and approximately 6865.05% from the retail business, excluding intersegment eliminations.

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Gross Profit

Gross profit is revenue less cost of goods sold, net. Cost of goods sold includes the costs directly attributable to product sales and includes amounts paid for finished goods, such as flower, edibles, and concentrates, as well as packaging and other supplies, fees for services and processing, rent, utilities, and related costs. Cannabis costs are affected by various state regulations that limit the sourcing and procurement of cannabis product, which may create fluctuations in gross profit over comparative periods as the regulatory environment changes. Gross profit margin measures the Company’s gross profit as a percentage of revenue.

The Company’s expansion strategy and revenue growth have taken priority and will continue to do so for the foreseeable future as it expands its footprint, by exploring new markets and opening or acquiring new dispensary locations, and scales production within certain markets. In the core markets in which the Company is already operational and, as the state markets mature, the Company ~~anticipates~~has ~~that~~experienced ~~there will be~~ pressure on margins inwithin the cultivation (wholesale) and retail channels and expects this to continue as markets mature. The Company’s current production capacity has not been fully realized and it is expected that price compression at the cultivation (wholesale) level, will be partially offset by operational optimization.

Total Expenses

Total expenses other than the cost of goods sold consist of selling costs to support customer relationships and to deliver product to the Company’s retail stores. It also includes a significant investment in the corporate infrastructure required to support ongoing business.

Selling costs generally correlate to revenue. As a percentage of sales, selling costs are expected to continue to increase slightly in currently operational markets as facility and market expansion occurs. The increase is expected to continue to be driven primarily by the growth of the Company’s retail and cultivation (wholesale) channels and ~~the ramp up from~~ new retail openings.

SG&A expenses also include personnel costs incurred ~~at the Company’s corporate offices~~, ~~primarily related to back-office personnel costs,~~ including salaries, incentive compensation, benefits, stock-based compensation and professional service costs. ~~Going forward,~~ SG&A expenses ~~are~~may ~~expected~~increase ~~to continue~~ in ~~line~~connection with supporting the ~~Company’s~~business ~~expansion~~and ~~plans. Furthermore,~~ the Company ~~expects~~could toexperience ~~continue to incur acquisition and transaction costs related to these expansion plans and anticipates~~ an increase in ~~stock compensation~~ expenses related to recruiting and hiring talent, along with legal and professional fees associated with being a public-reporting company ~~and publicly traded in Canada and a public-reporting company in the U~~.S.

Provision for Income Taxes

The Company is subject to income taxes in the jurisdictions in which it operates and, consequently, income tax expense is a function of the allocation of taxable income by jurisdiction and the various activities that impact the timing of taxable events. As the Company operates in the cannabis industry, it is subject to the limits of Section 280E of the Code under which the Company is only allowed to deduct expenses directly related to the sale of products. This results in permanent differences between ordinary and necessary business expenses deemed non-allowable under Section 280E of the Code and a higher effective tax rate than most industries. The Company has taken a position that it does not owe taxes attributable to the application of Section 280E of the Code.

During the second quarter of 2023, Connecticut, Illinois, and New Jersey enacted tax legislation to exempt, or decouple, from Section 280E of the Code, all of which became retroactively effective as of January 1, 2023. The Company has significant operations in these states and is now permitted to deduct ordinary and necessary cannabis business expenses in these states.85

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LIQUIDITY, FINANCING ACTIVITIES AND CAPITAL RESOURCES

As of December 31, ~~2024~~2025 and ~~2023~~2024, the Company had total current liabilities of $~~197~~140,~~968~~261 and $~~412~~203,~~188~~112, respectively, and had cash and cash equivalents of $8782,~~796~~724 and $~~174~~87,~~760~~796, respectively, to meet its current obligations. The Company had working capital of $~~159~~264,~~541~~390 and ~~a working capital deficit of~~ $~~(17~~159,~~992)~~541, for the years ended December 31, ~~2024~~2025 and ~~2023~~2024, respectively. This increase in working capital of $~~177~~104,~~533~~849 for the year ended December 31, ~~2024~~2025 when compared to the year ended December 31, ~~2023~~2024, was ~~primarily~~attributable to an increase in inventory driven by ~~the~~higher ~~Company’s~~production ~~position~~volumes ~~that~~and itmore ~~does~~efficient ~~not~~harvests ~~owe~~from ~~taxes~~expanded ~~attributable~~cultivation facilities coupled with a reduced income tax payable balance due in part to the ~~application~~Company's treatment of Section 280E of the Code, ~~thus~~which ~~reducing~~shifted ~~its~~a ~~Income~~portion ~~Taxes~~of ~~Payable~~the ~~balance~~short-term liability to a long-term liability on the Company's Condensed Consolidated Balance Sheets.

The Company generates cash from revenues and deploys its capital to acquire and develop assets capable of producing additional revenues and earnings over both the immediate and long term. Capital is primarily being utilized for ~~capital expenditures,~~ facility improvements, strategic investment opportunities, ~~product development~~ and ~~marketing,~~general ~~as well as customer, supplier,~~ and ~~investor~~administrative ~~and industry relations~~expenses. The Company takes a cautious approach in allocating its capital to maximize its returns while ensuring appropriate liquidity. Given inflation and the uncertainty of the future economic environment, the Company has taken additional measures in monitoring and deploying its capital to minimize the potentially negative impact on its operations and expansion plans.

Liquidity Requirements

Our short-term liquidity requirements consist primarily of funds necessary to pay for our acquisitions, to repay borrowings, maintain our operations and other general business needs. We believe that internally generated funds and other sources of liquidity discussed below will be sufficient to meet working capital needs, capital expenditures, and other business requirements for at least the next 12 months. We believe we will meet known or reasonably likely future cash requirements through the combination of cash generated from operating activities, available cash balances and available borrowings. If these sources of liquidity need to be augmented, additional cash requirements would likely be financed through the issuance of equity securities or additional borrowings; however, there can be no assurances that we will be able to obtain additional equity financing or debt financing on acceptable terms, or on terms similar to our existing financings, in the future.

Our long-term liquidity requirements consist primarily of completing additional acquisitions, scheduled debt payments, ~~and~~ future payments of income tax payables, maintaining and expanding our operations and other general business needs. We expect to meet our long-term liquidity requirements through various sources of capital, which may include future debt or equity issuances, net cash provided by operations and other secured and unsecured borrowings. We believe that the foregoing sources of capital will provide sufficient funds for our operations, anticipated expansion and scheduled debt payments for the long-term. Our ability to fund our operating needs will depend on our future ability to continue to generate positive cash flow from operations and our ability to obtain debt or equity financing on acceptable terms.

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2022 Credit Facility

InOn October 27, 2022, Verano and certain of its subsidiaries and affiliates, as the Borrowers, entered into the 2022 Credit Agreement with Chicago Atlantic, as administrative agent for the ~~lenders~~Lenders, and the Lenders party thereto, pursuant to which the ~~lenders~~Lenders advanced the Borrowers a $350,000 senior secured term loan, and which also provides the Borrowers with the right, subject to conditions, to request an additional incremental term loan of up to $100,000; provided that the ~~lenders~~Lenders elect to fund such incremental term loan. At funding, all the proceeds of the loans made under the 2022 Credit Agreement were used to repay the amounts owing under the Company's previous senior secured term loan credit facility. In connection with such repayment, such previous credit facility was terminated and is no longer in force or effect.

The 2022 Credit Agreement ~~allows~~provides the Borrowers towith ~~(i)~~the ~~incur~~right, upsubject to ~~$120~~conditions,~~000~~ ofto ~~additional~~request ~~indebtedness~~an ~~from third-party lenders secured by real estate excluded as collateral under the 2022 Credit Agreement, (ii) incur~~ additional ~~mortgage~~incremental ~~financing~~term ~~from~~loan ~~third-party~~in ~~lenders secured by real estate acquired after~~ the ~~initial~~aggregate ~~funding~~principal amount of ~~the~~up ~~2022~~to ~~Credit Agreement~~$100,000; ~~and~~provided ~~(iii)~~that ~~upon~~ the ~~SAFE~~Lenders ~~Banking~~elect ~~Act~~to orfund ~~similar~~such ~~legislation~~incremental ~~making~~term ~~banking services available to U~~loan.S. ~~cannabis~~Beginning ~~companies~~in ~~being~~October ~~passed~~2023, by the ~~United~~loan ~~States~~requires ~~Congress,~~scheduled ~~incur~~amortization uppayments toof $~~50,000~~350 ~~under~~per amonth ~~revolving~~and ~~credit~~the ~~facility~~remaining ~~from~~principal ~~third-party~~balance ~~lenders that~~ is ~~pari~~due ~~passu~~in orfull ~~subordinated~~on toOctober ~~the 2022 Credit Agreement obligations~~30, ~~all of which are subject to customary conditions~~2026.

The ~~obligations under the~~ 2022 Credit Agreement ~~are~~also ~~secured~~provides bythe ~~substantially~~Borrowers ~~all~~with of the ~~assets~~right ofto ~~the~~(a) ~~Borrowers,~~incur ~~excluding~~up ~~vehicles~~to $120,000 ~~specified~~of ~~parcels~~additional ofindebtedness from third-party lenders secured by real estate ~~and~~excluded ~~other~~as ~~customary~~collateral ~~exclusions.~~under ~~The~~the 2022 Credit Agreement, ~~provides~~(b) ~~for~~incur aadditional ~~floating~~mortgage ~~annual~~financing ~~interest~~from ~~rate~~third-party ~~equal~~lenders tosecured ~~the~~by ~~prime~~real ~~rate~~estate ~~then~~acquired inafter ~~effect~~the ~~plus~~closing ~~6.50%~~date, ~~which~~and ~~rate~~(c) ~~may be increased by 3.00%~~ upon anthe ~~event~~SAFE ofBanking ~~default~~Act ~~that~~or issimilar ~~not~~legislation amaking ~~material~~banking ~~event~~services ofavailable ~~default~~to ~~or 6~~U.~~00%~~S. ~~upon~~cannabis acompanies ~~material~~being ~~event~~passed ofby ~~default as provided in~~ the ~~2022~~United ~~Credit~~States ~~Agreement.~~Congress, ~~The~~incur ~~initially~~up ~~funded~~to $~~350~~50,000 ~~loan~~pursuant ~~requires~~to ~~scheduled~~a ~~amortization~~revolving ~~payments~~credit offacility ~~$350~~from ~~per~~third-party ~~month~~lenders ~~beginning~~that inis ~~October~~pari ~~2023~~passu ~~with~~or subordinated to the ~~remaining~~2022 ~~principal~~Credit ~~balance~~Agreement ~~due~~obligations, ineach ~~full~~of onwhich ~~October~~are ~~30,~~subject ~~2026~~to customary conditions.

AtThe ~~any~~obligations ~~time,~~under the ~~Borrowers~~2022 ~~may~~Credit ~~voluntarily~~Agreement ~~prepay~~are upsecured toby ~~$100,000~~substantially all of the ~~principal~~assets ~~balance,~~of ~~subject~~the ~~to a one-time $1~~Borrowers,~~000~~ ~~prepayment~~excluding ~~premium upon the first prepayment~~vehicles, ~~and~~specified ~~may~~parcels ~~prepay the remaining outstanding principal balance for a prepayment premium at varying rates based on the timing~~ of ~~any~~real ~~subsequent~~estate ~~prepayments.~~and ~~The~~other ~~Borrowers~~customary ~~may not voluntarily prepay more than $100,000 of the principal balance without prepaying the entire outstanding principal balance of the loan~~exclusions.

OnThe ~~April~~2022 ~~30,~~Credit ~~2024,~~Agreement ~~the~~provides ~~Company,~~for ~~made~~ a ~~Permitted~~floating ~~Partial~~annual ~~Optional~~interest ~~Prepayment~~rate ~~(as~~equal ~~defined~~to in the ~~2022~~prime ~~Credit~~rate ~~Agreement)~~then in ~~the~~effect ~~amount~~plus ~~of $~~6.50%,~~000~~ ~~pursuant~~which torate ~~the~~may ~~2022~~be ~~Credit~~increased ~~Agreement~~by ~~and~~3.00% ~~paid~~upon an event of default that is not a ~~$1,000~~material ~~prepayment~~event ~~premium~~of indefault ~~connection~~or ~~therewith~~6.00% upon a material event of default as provided in the 2022 Credit Agreement.

InAt ~~connection~~any ~~with such Permitted Partial Optional Prepayment~~time, ~~Chicago~~the ~~Atlantic~~Company ~~and~~may ~~certain~~voluntarily ~~Lenders~~prepay ~~agreed~~up to ~~(a)~~$100,000 ~~release~~of the ~~Released~~principal ~~Borrowers~~balance, ~~from~~subject ~~their~~to ~~obligations~~a ~~under~~one-time $1,000 ~~and~~prepayment aspremium ~~parties~~upon ~~to,~~ the ~~2022~~first ~~Credit~~prepayment, ~~Agreement~~ and ~~related~~may ~~agreements and~~prepay ~~(b)~~the ~~release~~remaining ~~all~~outstanding ~~liens~~principal ~~over~~balance ~~the~~for ~~Released~~a ~~Borrowers’~~prepayment ~~property,~~premium ~~including~~at ~~real~~varying ~~estate,~~rates ~~held~~based byon ~~Chicago Atlantic for~~ the ~~benefit~~timing of ~~the~~any ~~Lenders,~~subsequent inprepayments. ~~each~~The ~~case,~~Borrowers ~~pursuant~~may tonot avoluntarily ~~limited~~prepay ~~consent~~more ~~and~~than ~~waiver~~$100,000 ~~dated as~~ of ~~April~~the ~~29,~~principal ~~2024,~~balance bywithout ~~and~~prepaying ~~among~~ the ~~Borrowers,~~entire ~~certain~~outstanding principal balance of the ~~Lenders party thereto and Chicago Atlantic~~loan.

~~The~~On April 30, 2024, the Company made a Permitted Partial Optional Prepayment (as defined in the 2022 Credit Agreement) ~~includes~~in ~~customary~~the ~~representations~~amount of $50,000 ~~warranties~~pursuant to the 2022 Credit Agreement and ~~covenants~~paid a $1,000 prepayment premium in connection therewith. In connection with such Permitted Partial Optional Prepayment, Chicago Atlantic and ~~customary~~certain ~~events~~Lenders ofagreed ~~default~~to (a) release certain Borrowers from their obligations under, ~~including~~and ~~payment~~as ~~defaults~~parties to, ~~breaches~~the of2022 ~~representations~~Credit Agreement and ~~warranties~~related agreements and (b) release all liens over such Borrowers’ property, ~~covenant~~including ~~defaults~~real estate, ~~cross-defaults~~held by Chicago Atlantic for the benefit of the Lenders, in each case, pursuant to ~~material~~a ~~indebtedness~~limited consent and waiver, dated as of April 29, 2024, by and ~~events~~among Borrowers, certain of ~~bankruptcy~~the lenders party thereto and ~~insolvency~~Chicago Atlantic.

~~The~~On ~~2022~~September ~~Credit~~30, ~~Agreement also includes customary negative covenants limiting the Borrowers’ ability to incur additional indebtedness and grant liens~~2025, ~~and~~ the ~~ability~~Company tomade ~~enter~~a ~~into~~Permitted ~~definitive~~Partial ~~documents~~Optional orPrepayment ~~consummate~~(as ~~acquisitions~~defined orin ~~dispositions that are not otherwise permitted thereunder, among others. Additionally,~~ the 2022 Credit Agreement) ~~requires~~in the ~~Borrowers~~amount toof ~~meet financial tests regarding minimum cash balances~~$50,000 ~~minimum~~pursuant ~~levels~~to ~~of Adjusted EBITDA (as defined in~~ the 2022 Credit Agreement), ~~and~~without aany ~~minimum~~penalty ~~fixed~~or ~~charge coverage ratio~~premium.

AsThe 2022 Credit Agreement includes customary representations, warranties, covenants and customary events of ~~December 31~~default, ~~2024~~including, ~~the~~without ~~Company~~limitation, ~~was~~payment indefaults, ~~compliance~~breaches ~~with~~of ~~such~~representations ~~covenants~~and warranties, covenant defaults, cross-defaults to material indebtedness, and events of bankruptcy and insolvency.

As of December 31, 2025, the Company was in compliance with such covenants.

George Archos, the Chairman and Chief Executive Officer of the Company, participated in the 2022 Credit Agreement as a lender funding $1,000 of the $350,000 principal amount. Mr. Archos is excluded from certain approval rights of the lenders and any penalties and fees due to Mr. Archos under the 2022 Credit Agreement are immaterial to the Company.

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~~Mortgage Loans~~Revolver

On ~~May~~September 1430, ~~2021~~2025, the Company ~~acquired~~entered ~~The~~into ~~Healing~~the ~~Center~~Revolver, ~~LLC~~by ~~(“The~~and ~~Healing~~among ~~Center”), which consisted of three dispensaries in~~ the ~~greater~~Company, ~~Pittsburgh area. The Healing Center leased the real estate where the dispensaries are located from three separate real estate entities (collectively referred to~~ as ~~“THC~~a ~~Real Estate”) and on September 3~~guarantor, ~~2021,~~ the ~~Company acquired the THC~~ Real Estate. ~~The~~Subsidiaries, ~~Company~~lenders ~~funded~~from ~~the~~time-to-time ~~acquisition~~party ofthereto, ~~the~~and ~~THC Real Estate through a credit facility with~~ Chicago Atlantic ~~Credit Company for $12~~,~~650~~ ~~and~~as ~~interest~~administrative ofagent ~~9.75%~~for ~~per~~the ~~annum~~lenders. ~~This loan has been paid in full and is no longer outstanding as of December 31, 2023.~~

OnThe ~~June~~Revolver 29initially provided for a $75,000 ~~2022~~revolving loan facility, ~~the~~$50,000 ~~Company~~of ~~entered~~which ~~into~~was adrawn ~~real~~on ~~estate~~September ~~loan~~30, ~~with~~2025 aand ~~community~~was ~~bank~~used to ~~borrow~~prepay, awithout ~~principal~~any ~~amount~~penalty ofor premium, $1850,000 ~~secured~~of byoutstanding ~~real~~obligations ~~estate~~due ~~and~~under ~~improvements~~the ~~thereon~~2022 inCredit ~~Branchburg, New Jersey~~Agreement. The ~~mortgage~~Revolver ~~bears~~provides anfor a floating annual interest rate ofon amounts drawn equal to one-month Term SOFR (subject to a minimum 4% ~~and~~SOFR ~~matures~~floor) plus 6%, which rate may be increased by 3% upon an event of default or by 6% upon a material event of default as provided in ~~July~~the ~~2047~~Revolver. The Company incurred debt issuance costs of $2,210 in connection with the establishment of the Revolver.

OnThe ~~March~~Revolver 9,may ~~2023~~be drawn in $2,500 ~~the~~increments ~~Company~~upon ~~entered~~ten ~~into~~business adays ~~real~~prior ~~estate~~notice ~~loan~~and ~~with~~any aoutstanding ~~community~~amount ~~bank~~under tothe ~~borrow~~Revolver amay ~~principal~~be ~~amount~~voluntarily ofprepaid in $202,~~000~~500 ~~secured~~increments byupon ~~real~~five ~~estate~~business ~~and~~days ~~improvements~~prior ~~thereon~~notice inwithout ~~Rocky~~any ~~Hill~~penalty or premium, ~~Connecticut.~~unless ~~The~~such ~~loan~~prepayment ~~bears~~occurs anwithin ~~interest~~six ~~rate~~months of ~~5.75%~~the ~~and~~applicable ~~matures~~advance, in ~~March~~which ~~2028~~case, ~~and~~such prepayment will be subject to a six-month interest make whole. Any amounts prepaid may be ~~extended~~redrawn subject to funding requirements set forth therein. The Revolver was initially subject to a borrowing base which required the outstanding principal balance under the Revolver to be equal to or less than 60% of the appraised value, net of certain indebtedness, of the owned real estate serving as collateral for ~~four~~the ~~additional~~Revolver ~~five-year~~from ~~periods~~time to time.

On ~~September~~January 2912, ~~2023~~2026, the Company, the Real Estate Subsidiaries, the Revolver Lenders and Chicago Atlantic entered into athe ~~real~~Revolver ~~estate~~First ~~loan~~Amendment ~~with~~to aCredit ~~community~~Agreement ~~bank~~and Omnibus First Amendment to ~~borrow~~Credit aDocuments, ~~principal~~to ~~amount~~amend the Revolver and related credit documents initially entered into on September 30, 2025. The Revolver First Amendment increased the lending commitment of the Revolver from $1475,~~500~~000 ~~secured~~to by$100,000 ~~real~~and ~~estate~~amended the date on which all outstanding amounts are due in ~~Chester~~full from September 29, ~~Pennsylvania~~2028 to February 28, 2029. ~~The~~Additionally, ~~loan~~the ~~bears~~Revolver First Amendment amended the borrowing base for the Revolver to an ~~interest~~advance rate of ~~7.5~~up to 80%, rather than 60%, of the appraised value, net of certain indebtedness, of the owned real estate serving as collateral for the Revolver. The Revolver First Amendment also includes certain other immaterial updates to the Revolver. No additional collateral was pledged to secure the Revolver and ~~matures~~certain real estate may be released as collateral upon specified conditions, as originally provided. Amounts drawn under the Revolver do not require amortization payments with all outstanding amounts being due in ~~October~~full on the maturity date of September 29, 2028.

~~2023~~The ~~Loan~~obligations ~~Agreement~~under the Revolver are secured by substantially all of the assets of the Real Estate Subsidiaries, which primarily consistent of owned real estate, and are guaranteed by the Company on an unsecured basis. Additionally, the Revolver allows for the proportionate release of certain Real Estate Subsidiaries upon request of the Company so long as the outstanding principal balance under the Revolver does not exceed 60% of the appraised value, net of certain indebtedness, of the owned real estate serving as collateral after giving effect to such release.

OnThe ~~December~~Revolver 26includes customary representations, ~~2023~~warranties, acovenants ~~subsidiary~~and customary events of ~~the~~default, ~~Company~~including, aswithout ~~the~~limitation, ~~borrower~~payment ~~(“Loan~~defaults, ~~Agreement~~breaches ~~Borrower”),~~of ~~entered~~representations ~~into~~and awarranties, ~~Loan~~covenant ~~Agreement~~defaults, ~~(the~~cross-defaults ~~“Loan~~to ~~Agreement”)~~material indebtedness, ~~with~~and ~~First~~events ~~Federal~~of ~~Bank~~bankruptcy ~~(“Loan~~and ~~Agreement Lender”)~~insolvency. The ~~Loan~~Revolver ~~Agreement~~also ~~Borrower’s~~includes ~~obligations~~customary ~~under~~covenants, including, without limitation, limiting the ~~Loan~~Real ~~Agreement~~Estate isSubsidiaries’ ~~guaranteed~~ability byto ~~the~~incur ~~Company~~additional indebtedness, make guarantees and ~~another~~grant ~~subsidiary~~liens that are otherwise not permitted and enter into or consummate acquisitions or dispositions that are not otherwise permitted, among others. As of December 31, 2025, the Company was in compliance with such covenants.

Pursuant to the Loan Agreement, $27,999 in principal was funded which is being repaid in 60 monthly installment payments based on a 300-month amortization schedule, with a balloon payment upon maturity. All unpaid principal and interest is due in full on December 26, 2028.88

~~The~~Table ~~obligations under the Loan Agreement are secured by a mortgage on real property located in Apollo Beach, Florida and owned by the Loan Agreement Borrower, together with certain other limited assets~~ of ~~Loan Agreement Borrower related to such real property.~~Contents

~~The~~Revolver ~~Loan~~First Agreement provides for a fixed annual interest rate of 8.34%, which interest rate may be increased by 2% if an event of default occurs; provided, that certain events of default allow the Loan Agreement Lender to declare all outstanding principal immediately due, in which case all unpaid principal will accrue interest at 18% per annum thereafter.Amendment

~~The~~On ~~Loan~~January ~~Agreement~~12, ~~further~~2026, ~~provides~~the Company, the ~~Loan~~Real Estate Subsidiaries, the Revolver Lenders and Chicago Atlantic entered into a First Amendment (the “Revolver First Amendment”) to Credit Agreement ~~Borrower~~and ~~with~~Omnibus First Amendment to Credit Documents, to amend the ~~right~~Revolver and related credit documents initially entered into on September 30, 2025. The Revolver First Amendment increased the lending commitment of the Revolver from $75,000 to ~~prepay~~$100,000 and amended the date on which all oroutstanding ~~any~~amounts ~~portion~~are due in full from September 29, 2028 to February 28, 2029. Additionally, the Revolver First Amendment amended the borrowing base for the Revolver to an advance rate of up to 80%, rather than 60%, of the ~~outstanding~~appraised ~~principal~~value, ~~balance~~net of certain indebtedness, of the owned real estate serving as collateral for the Revolver. The Revolver First Amendment also includes certain other immaterial updates to the Revolver. No additional collateral was pledged to secure the Revolver and certain real estate may be released as collateral upon specified conditions, as originally provided. Amounts drawn under the Revolver do not require amortization payments with ~~prepayment~~all ~~rates~~outstanding ~~ranging~~amounts ~~from~~being ~~0-2%~~due in full on the maturity date of February 28, 2029. On March 11, 2026, the ~~principal~~Company drew $50,000 under the Revolver, bringing the total amount ~~prepaid~~drawn under the Revolver to $100,000, ~~depending~~which onwas ~~when~~used ~~such~~to ~~prepayment~~repay ~~occurs~~the amounts owing under the 2022 Credit Agreement.

~~The~~2026 ~~Loan~~Credit Agreement includes customary representations and warranties and events of default, including, without limitation, payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to other indebtedness, and events of bankruptcy and insolvency, among others.

On March 11, 2026, Verano and certain of its subsidiaries and affiliates from time-to-time party thereto (collectively, the “2026 Borrowers”), entered into a Credit Agreement (the “2026 Credit Agreement”) with Needham Bank (“Needham”), as collateral agent and administrative agent for the lenders, Chicago Atlantic Financial Services, LLC, as co-administrative agent for the lenders, and the lenders from time-to-time party thereto (the “2026 Lenders”), pursuant to which the 2026 Lenders advanced the 2026 Borrowers a $195,000 senior secured term loan, all of which was used to repay the amounts owing under the 2022 Credit Agreement. In connection with such repayment, the Company paid a prepayment premium of approximately $4,345 and the 2022 Credit Agreement was terminated and is no longer in force or effect. Beginning in April 2026, Verano will be required to make scheduled amortization payments of $875 per month and the remaining principal balance is due in full on March 11, 2029; provided that the maturity date may be extended to March 11, 2030 upon the election of the Company, the payment of 1.5% of the then outstanding principal balance by the Company, and the consent of the 2026 Lenders. The 2026 Credit Agreement may be prepaid in part (in increments of $5,000 and in an amount not less than $10,000) or in full at any time, subject to a 1.5% prepayment premium during the first two years of the 2026 Credit Agreement and 0% thereafter; provided, that if the maturity date is extended to March 11, 2030, the prepayment premium will be 1.5% in all cases.

The obligations under the 2026 Credit Agreement are secured by substantially all of the assets of the 2026 Borrowers, excluding vehicles, specified parcels of real estate, other customary exclusions and subject to compliance with the terms of the 2026 Credit Agreement, entities, assets and parcels of real estate acquired after the closing of the 2026 Credit Agreement. The 2026 Credit Agreement provides for a floating annual interest rate equal to one-month Term SOFR (subject to a minimum 4% SOFR floor) plus 5.5%, which rate may be increased by 5% upon an event of default as provided in the 2026 Credit Agreement. The 2026 Credit Agreement included customary representations and warranties, covenants and customary events of default, including, without limitation, payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults to material indebtedness, and events of bankruptcy and insolvency.

Additionally, the 2026 Credit Agreement requires the Borrowers to meet certain financial tests regarding minimum cash balances and a minimum fixed charge coverage ratio.

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Columbia Care Eastern Virginia LLC

On July 29, 2024, the Company entered into the Virginia EPA to purchase all of the issued and outstanding equity interests of CC East Virginia. The transaction closed on August 21, 2024. Pursuant to the Virginia EPA, the Company issued the CC East Virginia Promissory Note in the amount of $26,700, which was amended to $27,852 on May 27, 2025 in connection with a purchase price adjustment. The CC East Virginia Promissory Note has an estimated fair value of $26,068, and bears interest at a rate of 7% per annum beginning on the closing date, through maturity on the two-year anniversary of the closing date. Subsequently, on May 27, 2025, the Company entered into a waiver and partial payoff agreement related to a portion of the CC East Virginia Promissory Note. During the year ended December 31, 2025, the Company partially extinguished the CC East Virginia Promissory Note.

Mortgage

Tax Liabilities

The Company has U.S. income tax payable liabilities. These income tax payable liabilities will require payment from our liquidity sources, and we believe we have sufficient liquidity for both short-term and long-term payments of our income tax payable liabilities ~~and~~ in addition to our other obligations. The Company expects to retain additional cash from operations, due in part to the Company's treatment of Section 280E of the Code as not applying to limit its deduction of ordinary and necessary business expenses.

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Sources and Uses of Cash

Cash Provided by (Used in) Operating ~~Activities~~, Investing and Financing Activities

Net cash provided by (used in) operating, investing, and financing activities for the years ended December 31, ~~2024,~~2025 ~~2023,~~and ~~2022~~2024, were as follows:

	For the Years Ended December 31,
	2024		2023		2022
	2025		2024		$ Change
Net Cash Provided by Operating Activities	$	~~112~~52,~~195~~855	$	~~109~~112,~~710~~195	$	94(59,~~347~~340)
Net Cash Used In Investing Activities	(~~133~~32,~~251~~601)		(34133,~~150~~251)		~~(207~~100,~~851)~~650
Net Cash Provided By (Used In) Financing Activities	(65,926)		14,354		99,245
Net Cash Used In Financing Activities	(25,321)		(65,926)		40,605

Cash Flows from Operating Activities. Cash flow generated from operating activities provides us with a significant source of liquidity. Our cash flows from operating activities result from cash received from our customers, offset by cash payments we make for products and services, operational costs, and income taxes. During the year ended December 31, 2025 and 2024, the Company had net cash inflows of $52,855 and $112,195, respectively. The $259,~~485~~340 ~~incease~~decrease was largely driven by an increase in inventory ~~attributable~~driven toby ~~acquisition~~higher ~~activity~~production ~~during~~volumes ~~the~~and ~~year~~more ~~ended~~efficient ~~December 31,~~harvests ~~2024,~~from ~~when~~expanded ~~compared~~cultivation tofacilities coupled with the income tax payments during the year ended December 31, ~~2023~~2025.

Cash Flows from Investing Activities. ~~Cash~~During ~~used~~the inyear ~~investing~~ended ~~activities~~December 31, ~~increased~~2025 byand 2024, the Company had net cash outflows of $99(32,~~101~~601) ~~which~~and ~~was~~$(133,251), ~~attributable~~respectively. toThe an$100,650 ~~increase~~decrease in ~~capital~~net ~~expenditures~~cash ofoutflows ~~$62~~during the year ended December 31,~~718~~ ~~for~~2025 compared to the year ended December 31, 2024 aswas primarily driven by lower purchases of property, plant and equipment of $(41,226) during the year ended December 31, 2025, compared to purchases of property, plant and equipment of $(99,048) during the year ended December 31, ~~2023~~2024, inas ~~addition~~well toas acquisition activity during the year ended December 31, 2024.

Cash Flows from Financing Activities. ~~Cash~~During ~~provided~~the byyear ~~financing~~ended ~~activities~~December 31, 2025 and 2024, the Company had net cash outflows of $(25,321) and $(65,926), respectively. The $40,605 decrease in net cash outflows during the year ended December 31, 2025 compared to the year ended December 31, 2024 was ~~largely~~ attributable to proceeds from debt related to the ~~Permitted~~loan ~~Partial~~with ~~Optional~~Rainbow ~~Prepayment~~Realty ~~under~~Group ~~the~~IV, ~~2022~~LLC, ~~Credit~~which ~~Agreement~~ was offset by principal repayments of debt during the year ended December 31, ~~2024~~2025. ~~when~~During ~~compared to~~ the year ended December 31, ~~2023~~2024, the net cash outflow was primarily attributable to the Company's Permitted Partial Optional Prepayment (as defined in the 2022 Credit Agreement) pursuant to the 2022 Credit Agreement.

The Company expects capital expenditures for ~~2025~~2026 to be between $2530,000 and $4050,000. The Company’s ~~expects~~2026 ~~its~~ capital expenditures inare ~~2025~~expected ~~will~~to besupport ~~focused~~cultivation onoperational efficiency, ~~initiatives~~selective atexpansion ~~cultivation~~of ~~facilities~~retail operations in existing ~~markets,~~and ~~targeting~~potential ~~expansion~~new ofmarkets, ~~our~~ retail ~~footprint~~store enhancements, and ~~improvements~~continued investment in ~~our~~ technology ~~systems~~and infrastructure.

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Changes in or Adoption of Accounting Practices

Refer to the discussion of recently adopted/issued accounting pronouncements within the Notes to the Consolidated Financial Statements, Note 2 — Significant Accounting Policies.

CRITICAL ACCOUNTING ESTIMATES

The preparation of the Company’s 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 these estimates. The estimates and underlying assumptions are reviewed by the Company 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 review affects both current and future periods. Significant judgments, estimates, and assumptions that have the most significant effect on the amounts recognized in the consolidated financial statements are described below.

Goodwill and Indefinite-lived Intangible Asset Impairment

Goodwill and indefinite-lived intangible assets are evaluated for impairment annually during the fourth quarter, or more frequently if an event occurs or circumstances change that could more likely than not reduce the fair value of a reporting unit or indefinite-lived intangible asset below its carrying value. In performing our annual goodwill impairment test, we may start with an optional qualitative assessment as allowed for under the accounting guidance. As part of the qualitative assessment, we evaluate all events and circumstances, including both positive and negative events, in their totality, to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If we bypass the qualitative assessment, or if the qualitative assessment indicates that a quantitative analysis should be performed, we perform a quantitative test for impairment. As part of the Company’s quantitative impairment analysis, the fair value of a reporting unit or indefinite-lived intangible asset is generally determined using both the income and market approaches. The income approach requires management to estimate a number of factors for each reporting unit or indefinite-lived intangible asset, including projected future operating results, economic projections, anticipated future cash flows and discount rates. The market approach estimates fair value using comparable marketplace fair value data from within a comparable industry grouping, as well as recent guideline transactions.

The determination of the fair value of the reporting units or indefinite-lived intangible assets requires the Company to make significant estimates and assumptions with respect to the business and financial performance of the Company’s reporting units or indefinite-lived intangible assets. These estimates and assumptions primarily include, but are not limited to:, the selection of appropriate peer group companies, control premiums appropriate for acquisitions in the industries in which we compete, discount rates, terminal growth rates, forecasts of revenue, operating income, depreciation, amortization, working capital requirements and capital expenditures. With regard to the Company’s goodwill reporting units, the Company also compares the sum of estimated fair values of reporting units to the Company’s fair value as implied by the market value of its equity. This comparison provides an indication that, in total, assumptions and estimates are reasonable. Future declines in the overall market value of the Company’s equity securities may provide an indication that the fair value of one or more reporting units has declined below its carrying value.

Although the Company believes its estimates of fair value are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions, could have a significant impact on either the fair value of the reporting units and indefinite-lived intangibles, the amount of any goodwill and indefinite-lived intangible impairment charges, or both. These estimates can be affected by a number of factors including, but not limited to, general economic conditions, availability of market information as well as the Company's profitability. The Company continues to monitor these potential impacts and economic, industry and market trends, and the impact these may have on the reporting units or indefinite-lived intangible assets.

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Finite-Lived Intangible Assets and Other Long-lived Assets Recoverability

The Company evaluates the recoverability of finite-lived intangible assets and other long-lived assets whenever events or changes in circumstances indicate that the carrying value of such an asset may not be recoverable. The evaluation of finite-lived intangible assets and other long-lived assets is performed at the lowest level of identifiable cash flows.

If the asset group fails the recoverability test, then an impairment charge is determined based on the difference between the fair value of the asset group compared to its carrying value. The fair value of the long-lived assets included in an impaired asset group may be determined using an income, market, or cost approach, or a combination thereof. The income approach utilizes assumptions including management’s best estimates of the expected future cash flows and the estimated useful life of the asset group. The cost approach utilizes assumptions for the current replacement costs of similar assets adjusted for estimated depreciation and deterioration of the existing equipment and economic obsolescence. The market approach requires the use of judgment in evaluating market comparable assets.

The determination of the fair value of the asset group requires management to estimate a number of factors including anticipated future cash flows, discount rates, and the identification of market comparable assets. Although we believe these estimates are reasonable, actual results could differ from those estimates due to the inherent uncertainty involved in making such estimates.

Business Combinations

In a business combination, all identifiable assets, liabilities and contingent liabilities acquired are recorded at their fair values. The determination of fair values of assets and liabilities acquired requires estimates and the use of valuation techniques when market value is not readily available. For any intangible asset identified, depending on the type of intangible asset and the complexity of determining its fair value, an independent valuation expert or management may develop the fair value, using appropriate valuation techniques, which are generally based on a forecast of the total expected future net cash flows. For intangible assets, the Company generally uses the income approach to determine fair value. The income approach requires management to make significant estimates and assumptions. These estimates and assumptions primarily include, but are not limited to:, discount rates, terminal growth rates, royalty rates, forecasts of revenue, operating income, depreciation, amortization and capital expenditures. The discount rates applied to the projections reflect the risk factors associated with those projections. Judgment is also required in determining the intangible asset’s useful life.

Although the Company believes its estimates of fair value are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on the determination of the fair value of the intangible assets acquired. Certain fair values may be estimated at the transaction date pending confirmation or completion of the valuation process. Where provisional values are used in accounting for a business combination, they may be adjusted in subsequent periods.

Provision for Income Tax

Provision for income taxes are made using the best estimate of the amount expected to be paid based on a qualitative assessment of all relevant factors. The Company reviews the adequacy of these provisions at the end of the reporting period. Although we believe our assumptions, ~~judgements~~judgments and estimates are reasonable, changes in tax laws or our interpretation of tax laws and the resolution of any tax audits could significantly impact the amounts provided for income taxes.

We recognize tax benefits from uncertain tax positions only if we believe that it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. These uncertain tax positions include our estimates related to uncertainties that are based on an assessment of whether our available documentation corroborating the nature of our activities supporting the tax positions will be sufficient. However, it is possible that at some future date an additional liability could result from audits by taxing authorities. If the final outcome of these tax related matters is different from the amounts that were initially recorded, such differences will affect the tax provisions in the period in which such determination is made. The IRS has taken the position that cannabis companies are subject to the limits of Section 280E of the Code under which they are only allowed to deduct expenses directly related to costs of goods sold. The Company has taken a position that its deduction of ordinary and necessary business expenses is not limited by Section 280E of the Code.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Financial Risk Management

The Company is exposed, into varying degrees, to a variety of financial instrument related risks. The Board and the Audit Committee mitigate these risks by assessing, monitoring and approving the Company’s risk management processes:

Credit Risk

The Company reviews its trade receivable accounts regularly and reduces amounts to their expected realizable values by adjusting the allowance for credit losses when management determines that the account may not be fully collectable. The Company applies ASC 326 Financial Instruments – Credit Losses for the measurement of expected credit losses, which uses an expected loss allowance model for all trade receivables. The Company has adopted standardized credit policies and performs assessments in an effort to minimize those risks. ~~The Company has not identified significant credit risk with respect to its customers noting that a customer is a single retail customer or an individual dispensary customer.~~

The Company provides credit to its customers in the normal course of business and has established credit evaluation and monitoring processes to mitigate credit risk, but has limited risk as the majority of its sales are transacted with cash.

Financial instruments that potentially subject the Company to concentrations of banking and credit risk consist primarily of cash and cash equivalents. The Company’s cash and cash equivalents primarily consisted of bank deposits and cash on hand. Concentrations of credit risk with respect to our cash and cash equivalents is limited primarily to amounts held with financial institutions in excess of federally insured limits.

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations associated with financial liabilities. The Company manages liquidity risk through the management of its capital structure. The Company’s approach to managing liquidity is to ensure that it will have sufficient liquidity to settle obligations and liabilities when due.

Market Risk

Market risk is the risk of loss arising from adverse changes in market rates and prices, such as interest rates, foreign exchange rates, raw materials and other commodity prices. As domestic economic conditions change, trends in discretionary consumer spending also become unpredictable and subject to reductions due to uncertainties about the future. A general reduction in consumer discretionary spending due to a recession in the domestic economy, or uncertainties regarding future economic prospects, could have a material adverse effect on our results of operations. The Company takes steps to mitigate this risk through diversifying Verano branded products at price points suitable for our customer base.

Currency Risk

The operating results and financial position of the Company are reported in U.S. dollars. However, some of the Company’s financial transactions are denominated in Canadian Dollars. The results of the Company’s operations are subject to currency transaction risks. The Company has no hedging agreements in place with respect to foreign exchange rates. The Company has not entered into any agreements or purchased any instruments to hedge possible currency risks.

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Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Cash and cash equivalents bear interest at market rates. Management believes that if the Company’s rates of interest associated with its debt obligations were to hypothetically change 10% in the relative interest rate, it would not have a material effect on the Company’s consolidated annual results of operations or cash flows.

Commodities Price Risk

Commodities price risk is the risk of variability in fair value due to movements in equity or market prices. The primary raw materials used by the Company aside from those cultivated internally are labels and packaging. Management believes a hypothetical 10% change in the price of these raw materials would not have a significant effect on the Company’s consolidated annual results of operations or cash flows, as these costs are generally passed through to its customers. However, such an increase could have an impact on our customers’ demand for our products, and we are not able to quantify the impact of such potential change in demand on our combined annual results of operations or cash flows.

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Banking Risk

Notwithstanding that a majority of states have legalized medical or adult use cannabis, or both, and the Executive Order there has been no change in U.S. federal banking laws related to the deposit and holding of funds derived from activities related to the cannabis industry. Given that U.S. federal law currently provides that the production and possession of cannabis is illegal, there is a strong argument that banks cannot accept for deposit, funds from businesses involved with the cannabis industry. Consequently, businesses involved in the cannabis industry often have difficulty accessing the U.S. banking system and traditional financing sources. The inability to open bank accounts with certain institutions may make it difficult to operate the businesses of the Company and leaves their cash holdings vulnerable.

Asset Forfeiture Risk

Because the cannabis industry remains illegal under U.S. federal law, any property owned by participants in the cannabis industry, which either are used in the course of conducting such business, or are the proceeds of such business, could be subject to seizure by law enforcement and subsequent civil asset forfeiture. Even if the owner of the property was never charged with a crime, the property in question could still be seized and subject to an administrative proceeding by which, with minimal due process, it could be subject to forfeiture.

Concentration Risk

The Company has substantial operations located in Florida, which accounted for approximately 28% of our consolidated sales as of December 31, 2025, where all sales are for medical products and are generated solely by our retail stores given the vertical integration requirements of Florida’s cannabis regulations. As a result, our business, financial condition, and results of operations are particularly sensitive to economic, regulatory, and competitive conditions in Florida. Should economic conditions deteriorate, competitive pressure intensify, or adverse regulatory changes occur within the region, our results of operations and financial position would be negatively impacted. In addition, Florida is prone to extreme weather events and natural disasters, such as hurricanes, which could cause significant property damage, business interruption, or supply chain disruptions. Insurance coverage for such events may be unavailable, inadequate, or prohibitively expensive. Furthermore, any adverse changes in state law, delays in the potential legalization of adult-use cannabis, or unfavorable regulatory actions could materially impact our business. We continue to monitor these risks and pursue geographic diversification to mitigate potential adverse effects.

Regulatory Risk

Regulatory risk pertains to the risk that the Company’s business objectives are contingent, in part, upon the compliance of regulatory requirements. Due to the nature of the industry, the Company recognizes that regulatory requirements are more stringent and punitive in nature. Any delays in obtaining, or failure to obtain regulatory approvals can significantly delay operational and product development and can have a material adverse effect on the Company’s business, results of operation, and financial condition.

The Company is cognizant of the advent of regulatory changes occurring in the cannabis industry on the city, state, and national levels. Although regulatory outlook on the cannabis industry has been moving in a positive trend, the Company is aware of the effect that unforeseen regulatory changes can have on the goals and operations of the business as a whole.

Tax Risk

Tax risk is the risk of changes in the tax environment that would have a material adverse effect on the Company’s business, results of operations, and financial condition. Currently, state licensed cannabis businesses are assessed a comparatively high effective federal tax rate due to Section 280E of the Code which bars businesses from deducting all expenses except their cost of sales when calculating federal tax liability. The Company has taken a position that its deduction of ordinary and necessary business expenses is not limited by Section 280E of the Code. Any increase in tax levies resulting from additional tax measures may have a further adverse effect on the operations of the Company, while any decrease in such tax levies will be beneficial to future operations.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial information required by Item 8 is located beginning on page F-1 of this report.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As required by Rule 13a-15(b) and Rule 15d-15(b) under the Exchange Act, our management, including our Chief Executive Officer and Chief Financial Officer, evaluated, as of December 31, ~~2024~~2025, the end of the period covered by this Form 10-K, the effectiveness of our disclosure controls and procedures as defined in Exchange Act Rule 13a-15(e) and Rule 15d-15(e). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Form 10-K.

We believe that a controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls systems are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud or error, if any, within a company have been detected.

Management’s Report on Internal Controls over Financial Reporting

Our management is responsible for establishing and maintaining effective internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. This system is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U.S. GAAP. Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, misstatements due to error or fraud may not be prevented or detected on a timely basis.

~~Remediation~~Our management performed an assessment of ~~Previously~~the ~~Identified~~effectiveness ~~Material~~of ~~Weaknesses~~our internal control over financial reporting at December 31, 2025, utilizing the criteria discussed in the “Internal Control – Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission. The objective of this assessment was to determine whether our internal control over financial reporting were effective as of December 31, 2025. Based on management's assessment, management has concluded that our internal controls over financial reporting were effective as of December 31, 2025.

In connection with the audit of our consolidated financial statements as of and for the year ended December 31, 2023, we identified material weaknesses in our internal controls over financial reporting. The previously reported material weaknesses, pertain to (i) a lack of appropriate internal controls to mitigate process risk points (“PRP”); (ii) a lack of appropriately design and effectiveness of Information Technology General Controls (“ITGC”) over vendor-hosted applications used by the Company supporting revenue and inventory processes; (iii) ineffectively designed controls over revenue and inventory processes to mitigate PRP; and (iv) ineffective implementation and documentation of management review controls over the goodwill and intangible asset impairment assessment.

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During the fiscal year ended December 31, 2024, management, with the oversight of the Audit Committee, implemented the following measures to remediate such material weaknesses described above:

•The Company enhanced its risk assessment process, implemented more frequent monitoring activities, and improved coordination between Internal Audit and management to proactively address changes in financial reporting risks.

•The Company addressed deficiencies by strengthening user access controls, improving change management procedures, and where vendor-hosted applications lacked direct ITGC controls, compensating business process controls were implemented to mitigate financial reporting risks.

•Additional reconciliation and validation procedures were implemented for retail and cultivation (wholesale) revenue, as well as inventory balances. Management also enhanced monitoring and reporting controls over inventory processes and strengthened ITGC and business process controls related to financial reporting systems.

•Management implemented enhanced review controls, strengthened documentation of key inputs used in impairment testing, and increased training for personnel involved in the evaluation process.

Such material weaknesses were deemed to be remediated as of the end of the period covered by this Form 10-K given the applicable controls have operated for a sufficient period of time and management has concluded, through testing, that the controls are designed and operate effectively.

Our management performed an assessment of the effectiveness of our internal control over financial reporting at December 31, 2024, utilizing the criteria discussed in the “Internal Control – Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission. The objective of this assessment was to determine whether our internal control over financial reporting were effective as of December 31, 2024. Based on management's assessment, management has concluded that our internal controls over financial reporting were effective as of December 31, 2024.

Our disclosure controls and procedures and internal controls over financial reporting are designed to provide reasonable assurance of achieving their objectives as specified above. Management does not expect, however, that our disclosure controls and procedures and internal controls over financial reporting will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

The effectiveness of the Company’s internal control over financial reporting as of December 31, ~~2024~~2025, has been audited by our independent registered public accounting firm as stated in their report which appears herein.

Changes in Internal Control over Financial Reporting

There have not been any changes in our internal control over financial reporting during the last fiscal quarter of the year ended December 31, ~~2024~~2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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ITEM 9B. OTHER INFORMATION

Rule 10b5-1 Trading Plans

AsDuring ~~previously disclosed in~~ the ~~Company’s~~fourth ~~Annual~~quarter ~~Report~~ended ~~on Form 10-K filed with the SEC on March 15~~December 31, ~~2024 and subsequent Quarterly Reports on Form 10-Q~~2025, ~~each~~none of ~~Laura~~our ~~Marie~~directors ~~Kalesnik,~~or ~~Edward~~officers ~~McDermott,~~adopted ~~David~~or ~~Spreckman,~~terminated ~~Richard~~a ~~Tarapchak,~~“Rule ~~John~~10b5-1 ~~Tipton and Darren Weiss entered into prearranged share~~ trading ~~plans,~~arrangement” ~~all~~or ~~of which are intended to satisfy the affirmative defenses of~~ “non-Rule 10b5-1~~(c)~~ ~~under the Exchange Act and the Company’s policies regarding insider~~ trading, ~~which were set to terminate December 31~~arrangement,” ~~2024.~~as ~~Due~~those toterms aare ~~settlement~~defined ~~event that will occur~~ in ~~2025~~Regulation ~~that affects awards covered by the applicable plans which vested in 2024~~S-K, ~~these~~Item ~~plans will terminate upon the completion of all sales relating to such settlement event~~408(a).

~~Brett~~Form ~~Summerer, the Company’s Chief Financial Officer, terminated his prearranged share trading plan, which was intended to satisfy the affirmative defenses of Rule 10b5~~8-~~1(c)~~K ~~under the Exchange Act and the Company’s policies regarding insider transaction, on December 13, 2024.~~Disclosures

~~During~~Annual ~~the~~Bonus three months ended December 31, 2024, Brett Summerer adopted a new prearranged share trading plan following the termination of his prior plan noted above, with a brokerage firm on the date set forth opposite his name below. This plan which was entered into during an open trading window under the Company's insider trading policy and is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act and the Company’s policies regarding insider transactions. The details regarding the estimated number of Subordinate Voting Shares for sale and the expiration date is set forth opposite his name below.Plan

Name

Title

Date of Adoption

Estimated Number of Subordinate Voting Shares for Sale1

Expiration Date2

Brett Summerer

Chief Financial Officer

December 13, 20243

317,455

December 31, 2026

We are providing the following disclosure in lieu of filing a Current Report on Form 8-K under Item 5.02.

2The ~~Such~~Board ~~plans~~and ~~are~~its ~~subject~~Compensation toCommittee ~~earlier~~from ~~termination~~time into time review the ~~event~~Company’s Annual Bonus Plan as part of ~~certain~~compensation ~~limited~~oversight. ~~circumstances~~On March 11, ~~and~~2026, ~~may~~the ~~remain~~Board, infollowing ~~place~~the ~~until~~Compensation ~~all~~Committee’s ~~sales~~recommendation, ~~contemplated~~adopted byamendments to the ~~plan~~Company’s ~~are~~Annual ~~completed~~Bonus Plan (the “Annual Bonus Plan”) regarding the Continuance, the timing of bonuses payments, and compliance with certain U.S. tax law provisions.

3The ~~Such~~description ~~prearranged~~of ~~share~~the ~~trading~~Annual ~~plan~~Bonus ~~will~~Plan is not ~~become~~complete ~~effective~~and ~~until~~is qualified in its entirety by reference to the ~~completion~~full text of the ~~applicable~~Annual ~~cooling-off~~Bonus ~~period~~Plan, ~~following~~a ~~the~~copy ~~termination~~ of Mrwhich is attached to this Annual Report on Form 10-K as Exhibit 10.11 ~~Summerer’s~~and ~~plan~~is ~~terminated~~incorporated inherein ~~December~~by ~~2024~~reference.

Credit Agreement

We are providing the following disclosure in lieu of filing a Current Report on Form 8-K under Items 1.01, 1.02, 2.03 and 8.01. Terms that are not defined below are defined elsewhere in this Annual Report on Form 10-K.

Item 1.01 Disclosure – Entry into a Material Definitive Agreement

On March 11, 2026, the 2026 Borrowers entered into the 2026 Credit Agreement with Needham, as collateral agent and administrative agent for the lenders, Chicago Atlantic Financial Services, LLC, as co-administrative agent for the lenders, and 2026 Lenders, pursuant to which the 2026 Lenders advanced the 2026 Borrowers a $195,000,000 senior secured term loan, all of which was used to repay the amounts owing under the 2022 Credit Agreement. In connection with such repayment, the Company paid a prepayment premium of approximately $4,345,000 and the 2022 Credit Agreement was terminated and is no longer in force or effect. Beginning in April 2026, Verano will be required to make scheduled amortization payments of $875,000 per month and the remaining principal balance is due in full on March 11, 2029; provided that the maturity date may be extended to March 11, 2030 upon the election of the Company, the payment of 1.5% of the then outstanding principal balance by the Company, and the consent of the 2026 Lenders. The 2026 Credit Agreement may be prepaid in part (in increments of $5,000,000 and in an amount not less than $10,000,000) or in full at any time, subject to a 1.5% prepayment premium during the first two years of the 2026 Credit Agreement and 0% thereafter; provided, that if the maturity date is extended to March 11, 2030, the prepayment premium will be 1.5% in all cases.

Additionally, the 2026 Credit Agreement requires the Borrowers to meet certain financial tests regarding minimum cash balances and a minimum fixed charge coverage ratio.

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The foregoing descriptions of the 2026 Credit Agreement are only summaries, do not purport to be complete and are qualified in their entirety by reference to the full texts of the Credit Agreement, which is attached as an exhibit to this Annual Report on Form 10-K.

Item 1.02 Disclosure – Termination of Material Definitive Agreement

As noted above, on March 11, 2026, the Company repaid the amounts owing under the 2022 Credit Agreement. The 2022 Credit Agreement was then terminated and is no longer in force or effect. All information included above to satisfy the disclosure requirements of Item 1.01 is incorporated as disclosure under Item 1.02.

Item 2.03 Disclosure – Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of the Registrant

The information set forth above to satisfy the disclosure requirements of Item 1.01 is incorporated by reference as disclosure under Item 2.03.

Item 8.01 Disclosures – Other Events

On March 11, 2026, the Company drew $50,000,000 under the Revolver, bringing the total amount drawn under the Revolver to $100,000,000, which was used to repay the amounts owing under the 2022 Credit Agreement.

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTION

Not applicable.

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PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this item is incorporated by reference to our definitive proxy statement for our ~~2025~~2026 Annual Meeting of ~~Shareholders~~Stockholders (our “~~2025~~2026 Proxy Statement”), which will be filed with the SEC not later than 120 days subsequent to December 31, ~~2024~~2025.

ITEM 11. EXECUTIVE COMPENSATION

The information required by this item is incorporated by reference to our ~~2025~~2026 Proxy Statement, which will be filed with the SEC not later than 120 days subsequent to December 31, ~~2024~~2025.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNER AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

ITEM 14. PRINCIPAL ~~ACCOUNTING~~ACCOUNTANT FEES AND SERVICES

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PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)Financial Statement and Schedules

The following Consolidated Financial Statements are included on the pages indicated:

Verano Holdings, Corp. Audited Consolidated Financial Statements						Page
Verano Holdings Corp. Audited Consolidated Financial Statements						Page
Reports of Independent Registered Public Accounting Firm (MGO PCAOB ID: 324)						F-1
Consolidated Balance Sheetsas of December 31, 2024 and 2023						F-4
Consolidated Balance Sheetsas of December 31, 2025 and 2024						F-3
Consolidated Statements of Operationsfor the Years Ended December 31, 2024, 2023 and 2022						F-5
Consolidated Statements of Operationsfor the Years Ended December 31, 2025, 2024 and 2023						F-4
Consolidated Statements of Changes in Shareholders’ Equityfor the Years Ended December 31, 2024, 2023 and 2022						F-6
Consolidated Statements of Changes in Stockholders’ Equityfor the Years Ended December 31, 2025, 2024 and 2023						F-5
Consolidated Statements of Cash Flowsfor the Years Ended December 31, 2024, 2023 and 2022						F-7
Consolidated Statements of Cash Flowsfor the Years Ended December 31, 2025, 2024 and 2023						F-6
Notes to the Consolidated Financial Statements						F-98

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(b)Exhibits

A list of exhibits filed with this Form 10-K is included in the Exhibit Index with Appendix A immediately preceding and is incorporated herein by reference:

ExhibitNumber						Description of Exhibit
3.1						Articles of Verano Holdings Corp., dated February 11, 2021 (filed as Exhibit 3.1 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
2.1						Plan of Arrangement (filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated by reference herein).
3.2						Notice of Articles of Verano Holdings Corp., dated February 11, 2021 (filed as Exhibit 3.2 to our Registration Statement on Form 10 filed April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
3.1						Articles of Domestication, dated November 3, 2025 (filed as Exhibit 3.1 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
4.1						Description of Registered Securities (filed as Exhibit 4.1 to our Annual Report on Form 10-K on March 30, 2023 (File No. 000-56342) and incorporated herein by reference).
3.2						Articles of Incorporation of Verano Holdings Corp., a Nevada corporation, dated November 3, 2025 (filed as Exhibit 3.2 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
3.3						Bylaws of Verano Holdings Corp., a Nevada corporation, dated November 3, 2025 (filed as Exhibit 3.3 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
4.1						Description of Capital Stock (filed as Exhibit 4.1 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
10.1†						Credit Agreement, dated as of October 27, 2022, by and among Verano Holdings Corp., certain subsidiaries of Verano Holdings Corp. from time-to-time party thereto, certain lenders from time-to-time party thereto, and Chicago Atlantic Admin, LLC, a Delaware limited liability company, as administrative agent for the lenders (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on October 27, 2022 (File No. 000-56342) and incorporated herein by reference).
10.2††						Executive Employment Agreement between Verano Holdings Corp. and George Archos, dated February 18, 2021 (filed as Exhibit 10.3 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.2†††						Executive Employment Agreement between Verano Holdings Corp. and George Archos, dated February 18, 2021 (filed as Exhibit 10.3 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.3††						Amendment to Executive Employment Agreement between Verano Holdings Corp. and George Archos, effective January 1, 2022 (filed as Exhibit 10.4 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.3†††						Amendment to Executive Employment Agreement between Verano Holdings Corp. and George Archos, effective January 1, 2022 (filed as Exhibit 10.4 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.4††						Executive Employment Agreement between Verano Holdings Corp. and Darren Weiss, dated February 18, 2021 (filed as Exhibit 10.5 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.5††						Amendment to Executive Employment Agreement between Verano Holdings Corp. and Darren Weiss, effective January 1, 2022 (filed as Exhibit 10.6 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.6††						Executive Employment Agreement between Verano Holdings Corp. and John Tipton, dated March 31, 2021 (filed as Exhibit 10.7 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.7††						Executive Employment Agreement between Verano Holdings Corp. and Brett Summerer, dated to be effective as of January 1, 2022 (filed as Exhibit 10.9 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).

~~107~~100

Table of Contents

ExhibitNumber						Description of Exhibit
10.8††						Executive Employment Agreement between Verano Holdings Corp. and Laura Kalesnik, dated March 1, 2021 (filed as Exhibit 10.8 to our Annual Report on Form 10-K on March 15, 2024 (File No. 000-56342) and incorporated herein by reference).
10.4†††						Executive Employment Agreement between Verano Holdings Corp. and John Tipton, dated March 31, 2021 (filed as Exhibit 10.7 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.9††						Stock and Equity Incentive Plan of Verano Holdings Corp (filed as Exhibit 10.10 to our Registration Statement on Form 10 filed on April 26, 2022 (File No. 000-56342) and incorporated herein by reference).
10.5†††						Executive Employment Agreement between Verano Holdings Corp. and Laura Kalesnik, dated March 1, 2021 (filed as Exhibit 10.8 to our Annual Report on Form 10-K on March 15, 2024 (File No. 000-56342) and incorporated herein by reference).
10.10††						Form of Equity Award Agreement for Stock Option (filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q filed on August 8, 2023 (File No. 000-56342) and incorporated herein by reference).
10.6†††*						Executive Employment Agreement between Verano Holdings Corp. and Richard Tarapchak, dated July 11, 2022.
10.11††						Form of Equity Award Agreement for RSU (filed as Exhibit 10.2 to our Quarterly Report on Form 10-Q filed on August 8, 2023 (File No. 000-56342) and incorporated herein by reference).
10.7†††*						Executive Employment Agreement between Verano Holdings Corp. and Edward A. McDermott III, dated November 12, 2021.
10.12††						Verano Holdings Corp. Annual Bonus Plan (filed as Exhibit 10.12 to our Annual Report on Form 10-K on March 15, 2024 (File No. 000-56342) and incorporated herein by reference).
10.8††						Stock and Equity Incentive Plan of Verano Holdings Corp (filed as Exhibit 10.1 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
10.13†						Loan Agreement, dated as of December 26, 2023, by and between a subsidiary of the Company as the Borrower and First Federal Bank (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on January 2, 2024 (File No. 000-56342) and incorporated herein by reference).
10.9††						Form of Equity Award Agreement for Stock Option (filed as Exhibit 10.2 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
10.14†						Promissory Note, dated as of December 26, 2023, by a subsidiary of the Company as the Borrower, in favor of First Federal Bank (filed as Exhibit 10.2 to our Current Report on Form 8-K filed on January 2, 2024 (File No. 000-56342) and incorporated herein by reference).
10.10††						Form of Equity Award Agreement for RSU (filed as Exhibit 10.3 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
10.15††						Cash Incentive Plan (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on March 26, 2024 (File No. 000-56342) and incorporated herein by reference).
10.11†††*						Verano Holdings Corp. Annual Bonus Plan.
10.16††						Form of Cash Award Agreement (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on March 26, 2024 (File No. 000-56342) and incorporated herein by reference).
10.12†						Loan Agreement, dated as of December 26, 2023, by and between a subsidiary of the Company as the Borrower and First Federal Bank (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on January 2, 2024 (File No. 000-56342) and incorporated herein by reference).
10.17						Equity Purchase Agreement, dated July 29, 2024, among Verano Holdings, LLC, Verano Holdings Corp., Columbia Care Eastern Virginia LLC and the members of Columbia Care Eastern Virginia LLC and The Cannabist Company Holdings Inc. (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on July 31, 2024 (File No. 000-56342) and incorporated herein by reference).
10.13††						Promissory Note, dated as of December 26, 2023, by a subsidiary of the Company as the Borrower, in favor of First Federal Bank (filed as Exhibit 10.2 to our Current Report on Form 8-K filed on January 2, 2024 (File No. 000-56342) and incorporated herein by reference).
10.18†						Verano Holdings, LLC Promissory Note (filed as Exhibit 10.2 to our Current Report on Form 8-K filed on August 22, 2024 (File No. 000-56342) and incorporated herein by reference).
10.14††						Cash Incentive Plan (filed as Exhibit 10.4 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
10.19†						Equity Purchase Agreement, dated July 29, 2024, among Verano Arizona, LLC, 203 Organix L.L.C., CC VA HoldCo LLC, Columbia Care-Arizona, Prescott, L.L.C. and The Cannabist Company Holdings Inc. (filed as Exhibit 10.3 to our Current Report on Form 8-K filed on July 31, 2024 (File No. 000-56342) and incorporated herein by reference).
10.15††						Form of Cash Award Agreement (filed as Exhibit 10.5 to our Current Report on Form 8-K12G3 filed on November 4, 2025 (File No. 000-56342) and incorporated herein by reference).
10.20†						Equity Purchase Agreement, dated July 29, 2024, among Verano Arizona, LLC, Salubrious Wellness Clinic, Inc., CC VA HoldCo LLC, Thomas Allison, Columbia Care-Arizona, Prescott, L.L.C. and The Cannabist Company Holdings Inc. (filed as Exhibit 10.4 to our Current Report on Form 8-K filed on July 31, 2024 (File No. 000-56342) and incorporated herein by reference).
10.16						Equity Purchase Agreement, dated July 29, 2024, among Verano Holdings, LLC, Verano Holdings Corp., Columbia Care Eastern Virginia LLC and the members of Columbia Care Eastern Virginia LLC and The Cannabist Company Holdings Inc. (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on July 31, 2024 (File No. 000-56342) and incorporated herein by reference).
14.1*						Code of Business Conduct and Ethics
10.17†						Verano Holdings, LLC Promissory Note (filed as Exhibit 10.2 to our Current Report on Form 8-K filed on August 22, 2024 (File No. 000-56342) and incorporated herein by reference).
19.1*						Verano Holdings Corp. Insider Trading Policy
10.18#						Amendment, effective May 27, 2025, to the Verano Holdings LLC Promissory Note dated August 21, 2024 (filed as Exhibit 10.2 to our Quarterly Report on Form 10-Q filed on August 7, 2025 (File No. 000-56342) and incorporated herein by reference).
21.1*						List of Subsidiaries of the Registrant
10.19						Waiver and Partial Payoff Agreement by and among Verano Holdings, LLC, The Cannabist Company Holdings, Inc. and CC VA Holdco LLC entered into as of May 27, 2025 (filed as Exhibit 10.3 to our Quarterly Report on Form 10-Q filed on August 7, 2025 (File No. 000-56342) and incorporated herein by reference).
23.1*						Consent of Independent Registered Public Accounting Firm, Macias Gini & O’Connell LLP
10.20††						Resignation Agreement and General Release between Verano Holdings Corp. and Brett Summerer dated April 13, 2025 (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on April 14, 2025 (File No. 000-56342) and incorporated herein by reference).
31.1*						Certification of CEO pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
31.2*						Certification of CFO pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
32.1*						Certification of CEO Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

~~108~~101

Table of Contents

ExhibitNumber						Description of Exhibit
10.21†						Consulting Agreement dated August 4, 2025 by and between Verano Holdings Corp. and Darren Weiss (filed as Exhibit 10.4 to our Quarterly Report on Form 10-Q filed on August 7, 2025 (File No. 000-56342) and incorporated herein by reference).
10.22†						Credit Agreement, dated September 30, 2025, by and among Verano Holdings Corp., certain subsidiaries of Verano Holdings Corp. from time-to-time party thereto, certain lenders from time-to-time party thereto, and Chicago Atlantic Admin, LLC, as administrative agent for the lenders (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on October 1, 2025 (File No. 000-56342) and incorporated herein by reference).
10.23†						First Amendment to Credit Agreement and Omnibus First Amendment to Credit Documents, dated January 12, 2026, by and among Verano Holdings Corp., certain subsidiaries of Verano Holdings Corp. from time-to-time party thereto, certain lenders from time-to-time party thereto, and Chicago Atlantic Admin, LLC, as administrative agent for the lenders (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on January 15, 2026 (File No. 000-56342) and incorporated herein by reference).
10.24*†						Credit Agreement, dated March 11, 2026, by and among Verano Holdings Corp., certain subsidiaries of Verano Holdings Corp. from time to time thereto, Needham Bank, as Administrative Agent, Chicago Atlantic Financial Services, LLC, as Co-Administrative Agent, and the lenders from time-to-time party thereto.
14.1*						Code of Business Conduct and Ethics
19.1*						Verano Holdings Corp. Insider Trading Policy
21.1*						List of Subsidiaries of the Registrant
23.1*						Consent of Independent Registered Public Accounting Firm, Macias Gini & O’Connell LLP
31.1*						Certification of CEO pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
31.2*						Certification of CFO pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
32.1*						Certification of CEO Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*						Certification of CFO Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1*						Verano Holdings Corp. Clawback Policy
101.INS						Inline XBRL Instance Document
101.SCH						Inline XBRL Taxonomy Extension Schema Document
101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document
104						Cover Page Interactive Data File (embedded within the Inline XBRL Document)
*						Filed or furnished herewith. The certifications attached as Exhibit 32.1 and Exhibit 32.2 that accompany this Form 10‑K are not deemed filed with the SEC and are not to be incorporated by reference into any filing of Verano Holdings Corp. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10‑K, irrespective of any general incorporation language contained in such filing.
†						Certain confidential portions of this exhibit have been omitted and replaced with “[***]”. Such identified information has been excluded from this exhibit because it (i) is not material and (ii) would likely cause competitive harm to the Company if disclosed.

* Filed or furnished herewith. The certifications attached as Exhibit 32.1 and Exhibit 32.2 that accompany this Form 10‑K are not deemed filed with the SEC and are not to be incorporated by reference into any filing of Verano Holdings Corp. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10‑K, irrespective of any general incorporation language contained in such filing.102

† Certain confidential portions of this exhibit have been omitted and replaced with “[***]”. Such identified information has been excluded from this exhibit because it (i) is not material and (ii) would likely cause competitive harm to the Company if disclosed.

†† Management contract, compensatory plan or arrangement.

109

Table of Contents


Exhibit Number						Description of Exhibit

††						Management contract, compensatory plan or arrangement.

#						Certain information contained in this exhibit has been omitted pursuant to 601(b)(10) because such information (i) is not material and (ii) is the type of information that the Company both customarily and actually treats as private and confidential.

103

Table of Contents

Appendix A

List of Licenses of Verano Holdings Corp.

Licenses in the State of Arizona

Holding Entity

License/Permit

City

Renewal Date

Description

203 Organix, LLC

00000074DCGW00540313

Prescott

8/7/2026

Medical Marijuana Dispensary Registration Certificate

203 Organix, LLC

00000070ESCO78837103

Prescott

8/7/2026

Adult-Use Marijuana Establishment License

Azgm 3, LLC

00000126DCSO00060479

Chandler

1/21/2027

Medical Marijuana Dispensary Registration Certificate

Azgm 3, LLC

00000040ESDX57445071

Chandler

1/21/2027

Adult-Use Marijuana Establishment License

Fort Consulting, LLC

00000105DCOU00194638

Phoenix

1/21/2027

Medical Marijuana Dispensary Registration Certificate

Fort Consulting, LLC

00000064ESAK09838873

Phoenix

1/21/2027

Adult-Use Marijuana Establishment License

Patient Alternative Relief Center, LLC

00000091DCWY00555666

Phoenix

8/7/2026

Medical Marijuana Dispensary Registration Certificate

Patient Alternative Relief Center, LLC

00000086ESQZ01367420

Phoenix

8/7/2026

Adult-Use Marijuana Establishment License

Perpetual Healthcare, LLC

00000033DCCK00134006

Phoenix

8/7/2026

Medical Marijuana Dispensary Registration Certificate

Perpetual Healthcare, LLC

00000105ESDR54985961

Phoenix

8/7/2026

Adult-Use Marijuana Establishment License

Salubrious Wellness Clinic, Inc.

~~000000097DCGK00454998~~00000097DCGK00454998

Tempe

8/7/2026

Medical Marijuana Dispensary Registration Certificate

Salubrious Wellness Clinic, Inc.

00000071ESFP14031510

Tempe

8/7/2026

Adult-Use Marijuana Establishment License

The Medicine Room, LLC

00000037DCDM00904008

Mesa

8/7/2026

Medical Marijuana Dispensary Registration Certificate

The Medicine Room, LLC

00000084ESFH12297246

Mesa

8/7/2026

Adult-Use Marijuana Establishment License

Vending Logistics, LLC

00000112DCLK00614860

Mesa

1/21/2027

Medical Marijuana Dispensary Registration Certificate

Vending Logistics, LLC

00000043ESPE02331128

Mesa

1/21/2027

Adult-Use Marijuana Establishment License

Licenses in the State of Connecticut

Holding Entity

License/Permit

City

Renewal Date

Description

Caring Nature EJV2, LLC

AMHF.0008262

~~Naugatauk~~Naugatuck

4/23/~~2025~~2026

Adult-Use Cannabis Medical Hybrid Retailer License

Caring Nature, LLC

AMHF.0008287

Waterbury

1/26/~~2026~~2027

Adult-Use Cannabis Medical Hybrid Retailer License

Connecticut Pharmaceutical Solutions, LLC

MMPR.0000002

Rocky Hill

2/10/~~2026~~2027

Medical Marijuana Producer License

CTPharma Newington, LLC

AMHF.0008258

Newington

10/11/~~2025~~2026

Adult-Use Cannabis Medical Hybrid Retailer License

CTPharma Norwich, LLC

AMHF.0008257

Norwich

7/6/~~2025~~2026

Adult-Use Cannabis Medical Hybrid Retailer License

Willow Brook Enfield, LLC

AMHF.0008260

Enfield

3/620/~~2025~~2027

Adult-Use Cannabis Medical Hybrid Retailer License

Willow Brook Wellness, LLC

AMHF.0008254

Meriden

12/17/2025

Adult-Use Cannabis Medical Hybrid Retailer License

Willow Brook Stratford LLC

AMHF.0008259

Ashford

3/20/2027

Adult-Use Cannabis Medical Hybrid Retailer License

Willow Brook Wellness, LLC

AMHF.0008254

Meriden

12/17/2026

Adult-Use Cannabis Medical Hybrid Retailer License

~~110~~104

Table of Contents

Licenses in the State of Florida

Holding Entity

License/Permit

City

Renewal Date

Description

Plants of Ruskin, LLC

MMTC-2017-0010

Apollo Beach

6/22/2026

Medical Marijuana Treatment Center License

Licenses in the State of Illinois

Holding Entity

License/Permit

City

Renewal Date

Description

420 Capital Management, LLC

280.000054-DISP

Chicago

4/3/2026

Registered Medical Cannabis Dispensing Organization License

420 Capital Management, LLC

284.000128-AUDO

Chicago

3/31/~~2026~~2028

Adult-Use Cannabis Dispensing Organization License

420 Capital Management, LLC

284.000127-AUDO

Lombard

3/31/~~2026~~2028

Adult-Use Cannabis Dispensing Organization License

Ataraxia, LLC

1503060700

Albion

3/9/~~2026~~2027

Medical Cannabis Cultivation Center Permit

Ataraxia, LLC

~~1503060700-AU~~7435572913

Albion

3/3031/~~2026~~2027

Adult-Use Cultivation Center License

Ataraxia, LLC

~~1503060700-TR~~TR00000010

Albion

7/1413/~~2025~~2026

Transporter License

Elevele, LLC

280.000032-DISP

Highland Park

3/18/~~2026~~2027

Registered Medical Cannabis Dispensing Organization License

Elevele, LLC

284.000135-AUDO

Highland Park

3/31/~~2026~~2028

Registered Adult-Use Cannabis Dispensing Organization License

Elevele, LLC

284.000136-AUDO

Prospect Heights

3/31/~~2026~~2028

Adult-Use Cannabis Dispensing Organization License

Healthway Services of West Illinois, LLC

280.000020-DISP

St. Charles

12/23/~~2025~~2026

Registered Medical Cannabis Dispensing Organization License

Healthway Services of West Illinois, LLC

284.000139-AUDO

St. Charles

3/31/~~2026~~2028

Registered Adult-Use Cannabis Dispensing Organization License

Healthway Services of West Illinois, LLC

284.000140-AUDO

Naperville

3/31/~~2026~~2028

Adult-Use Cannabis Dispensing Organization License

MME Aurora Retail, LLC

284.000132-AUDO

Aurora

3/31/~~2026~~2028

Adult-Use Cannabis Dispensing Organization License

MME Evanston Retail, LLC

280.000009-DISP

Evanston

11/9/~~2025~~2026

Registered Medical Cannabis Dispensing Organization License

MME Evanston Retail, LLC

284.000131-AUDO

Evanston

3/31/~~2026~~2028

Adult-Use Cannabis Dispensing Organization License

The Herbal Care Center, Inc.

280.000051-DISP

Chicago

1/13/~~2026~~2027

Registered Medical Cannabis Dispensing Organization License

The Herbal Care Center, Inc.

284.000133-AUDO

Chicago

3/31/~~2026~~2028

Adult-Use Cannabis Dispensing Organization License

The Herbal Care Center, Inc.

284.000134-AUDO

Chicago

3/31/~~2026~~2028

Adult-Use Cannabis Dispensing Organization License

Licenses in the State of Maryland

Holding Entity

License/Permit

City

Renewal Date

Description

AGG Wellness, LLC

DA-23-00102

Towson

6/30/2028

Medical & Adult Use Cannabis Establishment License

FGM Processing, LLC

PA-23-00025

Jessup

6/30/2028

Medical & Adult Use Cannabis Establishment License

Freestate Wellness, LLC

GA-23-00004

Jessup

6/30/2028

Medical & Adult Use Cannabis Establishment License

Freestate Wellness, LLC

DA-23-00010

Elkridge

6/30/2028

Medical & Adult Use Cannabis Establishment License

Maryland Natural Treatment Solutions, LLC

DA-23-00047

Pasadena

6/30/2028

Medical & Adult Use Cannabis Establishment License

Mikran, LLC

DA-23-00044

Germantown

6/30/2028

Medical & Adult Use Cannabis Establishment License

Licenses in the Commonwealth of Massachusetts

Holding Entity

License/Permit

City

Renewal Date

Description

Four Daughters Compassionate Care, Inc.

RMD1691

Sharon

14/15/2026

Medical Marijuana Treatment Center License

Four Daughters Compassionate Care, Inc.

MC282243

Sharon

12/12/~~2025~~2026

Marijuana Cultivator License

Four Daughters Compassionate Care, Inc.

MP281715

Sharon

12/12/~~2025~~2026

Marijuana Product Manufacturer License

Four Daughters Compassionate Care, Inc.

MR281552

Sharon

12/12/~~2025~~2026

Marijuana Retailer License

Four Daughters Compassionate Care, Inc.

MR282232

Plymouth

62/127/~~2025~~2027

Marijuana Retailer License

~~111~~105

Table of Contents

Licenses in the State of Michigan

Holding Entity

License/Permit

City

Renewal Date

Description

Buchanan Development, LLC

PC-000069

~~Buchannan~~Buchanan

4/25/~~2025~~2027

Facility License Provisioning Center

Buchanan Development, LLC

AU-R-000183

~~Buchannan~~Buchanan

3/16/~~2025~~2027

Establishment License Marihuana Retailer

Licenses in the State of Nevada

Holding Entity

License/Permit

City

Renewal Date

Description

Lone Mountain Partners, LLC

C122

North Las Vegas

6/30/~~2025~~2026

Adult-Use Cultivation License

Lone Mountain Partners, LLC

P077

North Las Vegas

6/30/~~2025~~2026

Adult-Use Production License

Lone Mountain Partners, LLC

T048

North Las Vegas

6/30/~~2025~~2026

Adult-Use Distribution License

Lone Mountain Partners, LLC

RD592

North Las Vegas

11/30/~~2025~~2026

Adult-Use Retail Store License

Lone Mountain Partners, LLC

RD590

Spring Valley

11/30/~~2025~~2026

Adult-Use Retail Store License

Naturex, LLC

D081

Las Vegas

6/30/~~2025~~2026

Adult-Use Retail Store License

WSCC, Inc.

D149

Carson City

6/30/~~2025~~2026

Adult-Use Retail Store License

WSCC, Inc.

D111

Reno

6/30/~~2025~~2026

Adult-Use Retail Store License

Licenses in the State of New Jersey

Holding Entity

License/Permit

City

Renewal Date

Description

Verano NJ, LLC

~~MC000012~~MC000407

Branchburg

12/31/~~2025~~2026

ATC Permit - Cultivation/Processing

Verano NJ, LLC

~~MM000008~~MM000207

Branchburg

12/31/~~2025~~2026

ATC Permit - Manufacturing

Verano NJ, LLC

C000009

Branchburg

4/17/~~2025~~2026

Class 1 - Adult-Use Cultivator License

Verano NJ, LLC

M000007

Branchburg

4/17/~~2025~~2026

Class 2 - Adult-Use Manufacturer License

Verano NJ, LLC

~~MRE000031~~MRE000816

Elizabeth

12/31/~~2025~~2026

ATC Permit - Medical Dispensing

Verano NJ, LLC

RE000001

Elizabeth

4/20/~~2025~~2026

Class 5 - Adult-Use Cannabis Retailer License

Verano NJ, LLC

~~MRE000034~~MRE000822

Neptune

12/31/~~2025~~2026

ATC Permit - Medical Dispensing

Verano NJ, LLC

RE000030

Neptune

8/1/~~2025~~2026

Class 5 - Adult-Use Cannabis Retailer License

Verano NJ, LLC

~~MRE000033~~MRE000815

Lawrence

12/31/~~2025~~2026

ATC Permit - Medical Dispensing

Verano NJ, LLC

RE000002

Lawrence

4/20/~~2025~~2026

Class 5 - Adult-Use Cannabis Retailer License

Zen Leaf Mount Holly, LLC

RE000913

Mount Holly

11/11/~~2025~~2026

Class 5 - Adult-Use Cannabis Retailer License

Licenses in the State of Ohio

Holding Entity

License/Permit

City

Renewal Date

Description

Mother Grows Best, LLC

CCC000033-00

Canton

11/24/~~2025~~2026

Dual Use Cultivation Certificate of Operation

Mother Grows Best, LLC

CCP000034-00

Canton

11/2324/~~2025~~2026

Dual Use Processor Certificate of Operation

Mother Grows Best, LLC

CCD000184-00

Antwerp

105/2011/~~2025~~2027

Dual Use Dispensary Certificate of Operation

Mother Knows Best, LLC

CCD000058-00

Canton

76/129/~~2025~~2026

Dual Use Dispensary Certificate of Operation

Ohio Natural Treatment Solutions, LLC

CCD000057-00

Newark

76/129/~~2025~~2026

Dual Use Dispensary Certificate of Operation

GreenRx, LLC

CCD000045-00

Cincinnati

76/130/~~2025~~2026

Dual Use Dispensary Certificate of Operation

Glass City Alternatives, LLC

CCD000056-00

Bowling Green

712/128/~~2025~~2026

Dual Use Dispensary Certificate of Operation

Mad River Remedies, LLC

CCD000047-00

Riverside

7/17/~~2025~~2027

Dual Use Dispensary Certificate of Operation

~~112~~106

Table of Contents

Licenses in the Commonwealth of Pennsylvania

Holding Entity

License/Permit

City

Renewal Date

Description

Agri-Kind, LLC

GP18-1006

Chester

7/31/~~2025~~2026

Medical Marijuana Grower/Processor Facility

Agronomed Biologics, LLC

CR06-GP19-1102

Chester

6/19/~~2025~~2026

Medical Marijuana Grower/Processor Facility

Agronomed Biologics, LLC

CR06-D19-1103

West Chester

6/19/~~2025~~2026

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