| | If you are a Shareholder and have any questions, please contact Morrow Sodali LLC, Goodness Growth’s proxy solicitation agent, by telephone at 1-888-999-3015 toll-free in North America, or collect calls outside North America at 1-289-695-3075, or by email at assistance@morrowsodali.com. | | |
| | | | Sincerely, | |
| | | | /s/ Dr. Kyle E. Kingsley Dr. Kyle E. Kingsley Chief Executive Officer and Chair of the Board | |
| | Important Notice Regarding the Availability of Proxy Materials for the Shareholders Meeting to Be Held on [•], 2022 The Notice of Meeting, the Circular, and form of proxy are available on the internet at the following website: investors.vireohealth.com/financials/regulatory-filings/ | | |
| | | | /s/ Dr. Kyle E. Kingsley Name: Dr. Kyle E. Kingsley Title: Chief Executive Officer and Chair of the Board | |
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No. | | | Proposal | | | Votes Necessary | |
1. | | | Arrangement Resolution Proposal | | | Approval requires: (i) at least 66 2/3% of the votes cast by the holders of Goodness Shares represented in person or by proxy at the Meeting, voting together as a single class; and (ii) pursuant to MI 61-101, the approval of the majority of the votes cast by each of the holders of Subordinate Voting Shares and the holders of Multiple Voting Shares, on a class basis, in each case excluding the votes cast by any Interested Parties pursuant to MI 61-101. In particular, approximately [•]% of the votes attaching to the Subordinate Voting Shares and [•]% of the votes attaching to Multiple Voting Shares are held by Interested Parties and will be excluded from such respective class votes for the purposes of determining whether “minority approval” has been obtained pursuant to MI 61-101. Since the sole holder of the Super Voting Shares is an Interested Party, the votes with respect to all of the Super Voting Shares will not be considered for purposes of determining whether “minority approval” has been obtained pursuant to MI 61-101. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the outcome of the voting on the Arrangement Resolution Proposal. | |
2. | | | Setting the Number of Directors Proposal | | | Approval requires the affirmative vote of a majority of the votes cast by the holders of Goodness Shares present in person or represented by proxy and entitled to vote at the Meeting, voting together as a single class. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the outcome of the voting on the Setting the Number of Directors Proposal. | |
3. | | | Director Election Proposal | | | Approval requires the affirmative vote of a majority of the votes cast by the holders of Goodness Shares present in person or represented by proxy and entitled to vote at the Meeting, voting together as a single class. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the outcome of the voting on the Director Election Proposal. | |
4. | | | Auditors Appointment Proposal | | | Approval requires the affirmative vote of a majority of the votes cast by the holders of Goodness Shares present in person or represented by proxy and entitled to vote at the Meeting, voting together as a single class. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the outcome of the voting on the Auditors Appointment Proposal. | |
Year Ended December 31 | | ||||||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (C$) | | | (C$) | | | (C$) | | |||||||||
Highest rate during the period | | | | | 1.29 | | | | | | 1.45 | | | | | | 1.36 | | |
Lowest rate during the period | | | | | 1.20 | | | | | | 1.27 | | | | | | 1.30 | | |
Average rate for the period | | | | | 1.25 | | | | | | 1.34 | | | | | | 1.33 | | |
Rate at the end of the period | | | | | 1.27 | | | | | | 1.27 | | | | | | 1.30 | | |
(In U.S. Dollars) | | | Six Months Ended June 30, 2022 | | | | | |||
Summary Pro Forma Balance Sheet | | | | | | | | | ||
Cash and cash equivalents | | | | $ | 109,803,729 | | | | | |
Total assets | | | | $ | 2,964,025,059 | | | | | |
Long-term debt, net of current portion | | | | $ | 189,596,769 | | | | | |
Total liabilities | | | | $ | 1,205,401,034 | | | | | |
Total stockholders’ equity and non-controlling interest | | | | $ | 1,758,624,025 | | | | | |
(In U.S. Dollars, except per share amounts) | | | Six Months Ended June 30, 2022 | | | Year Ended December 31, 2021 | | ||||||
Pro Forma Statement of Operations | | | | | | | | | | | | | |
Revenue | | | | $ | 461,511,259 | | | | | $ | 792,255,466 | | |
Gross profit | | | | $ | 209,587,704 | | | | | $ | 350,817,685 | | |
Net income (loss) after non-controlling interest | | | | $ | (34,513,414) | | | | | $ | (105,238,056) | | |
Net income (loss) per share – basic | | | | $ | (0.10) | | | | | $ | (0.33) | | |
Net income (loss) per share – diluted | | | | $ | (0.10) | | | | | $ | (0.33) | | |
Weighted average shares used in computation of net income (loss) per share – basic | | | | | 356,422,281 | | | | | | 319,463,210 | | |
Weighted average shares used in computation of net income (loss) per share – diluted | | | | | 356,422,281 | | | | | | 319,463,210 | | |
| | | Subordinate Voting Shares Closing Price | | | Verano Subordinate Voting Shares Closing Price | | | Exchange Ratio | | | Implied Per Share Value of the Arrangement Consideration | | ||||||||||||
January 31, 2022 | | | | C$ | 2.07 | | | | | C$ | 13.40 | | | | | | 0.22652 | | | | | C$ | 0.47 | | |
[•], 2022 | | | | C$ | [•] | | | | | C$ | [•] | | | | | | 0.22652 | | | | | C$ | [•] | | |
| Date | | | Acquirer | | | Target | |
| October 2018 | | | iAnthus Capital Holdings Inc. | | | MPX Bioceutical Corp. | |
| April 2019 | | | Cresco Labs Inc. | | | Origin House | |
| December 2020 | | | Aphria Inc. | | | Tilray, Inc. | |
| May 2021 | | | Trulieve Cannabis Corp. | | | Harvest Health & Recreation | |
| September 2021 | | | TerrAscend Corp. | | | Gage Growth Corp. | |
| December 2021 | | | Planet 13 Holdings Inc. | | | Next Green Wave Holdings Inc. | |
| | | EV / Revenue | | |||||||||
| | | LTM | | | NTM | | ||||||
Low | | | | | 4.1x | | | | | | 1.5x | | |
High | | | | | 15.3x | | | | | | 7.1x | | |
Average (Excluding High & Low) | | | | | 7.9x | | | | | | 4.3x | | |
| | | Tranche 1 | | | Tranche 2 | | ||||||||||||||||||||||||||||||||||||||||||
| | | EV / Revenue | | | EV / EBITDA | | | EV / Revenue | | | EV / EBITDA | | ||||||||||||||||||||||||||||||||||||
| | | 2022 | | | 2023 | | | 2022 | | | 2023 | | | 2022 | | | 2023 | | | 2022 | | | 2023 | | ||||||||||||||||||||||||
Low | | | | | 2.2x | | | | | | 1.9x | | | | | | 6.1x | | | | | | 5.2x | | | | | | 1.6x | | | | | | 1.2x | | | | | | 4.7x | | | | | | 3.1x | | |
High | | | | | 3.9x | | | | | | 3.1x | | | | | | 12.0x | | | | | | 11.3x | | | | | | 3.2x | | | | | | 2.0x | | | | | | 13.4x | | | | | | 6.3x | | |
Average (Excluding High & Low) | | | | | 2.9x | | | | | | 2.3x | | | | | | 8.1x | | | | | | 7.0x | | | | | | 2.2x | | | | | | 1.5x | | | | | | 8.7x | | | | | | 5.3x | | |
| | | EV / Revenue | | | EV / EBITDA | | ||||||||||||||||||||||||||||||
| | | 2021E | | | 2022E | | | 2023E | | | 2021E | | | 2022E | | | 2023E | | ||||||||||||||||||
Minimum | | | | | 0.7x | | | | | | 0.5x | | | | | | 0.4x | | | | | | 6.5x | | | | | | 3.7x | | | | | | 2.7x | | |
Average (Excluding High / Low) | | | | | 3.7x | | | | | | 2.4x | | | | | | 1.9x | | | | | | 15.6x | | | | | | 8.6x | | | | | | 5.8x | | |
Maximum | | | | | 4.9x | | | | | | 3.7x | | | | | | 2.9x | | | | | | 25.5x | | | | | | 14.7x | | | | | | 10.3x | | |
| Date | | | Acquiror | | | Target | |
| Nov-21 | | | Harborside Inc. | | | UL Holdings Inc. & LPF JV Corp. | |
| Nov-21 | | | Curaleaf Holdings, Inc. | | | Tryke Companies | |
| Sep-21 | | | TerrAscend Corp. | | | Gage Growth Corp. | |
| Jul-21 | | | Verano Holdings Corp. | | | WSCC Inc. | |
| May-21 | | | Trulieve Cannabis Corp. | | | Harvest Health & Recreation Inc. | |
| Apr-21 | | | Parallel | | | Windy City | |
| Mar-21 | | | Cresco Labs | | | Cultivate Licensing LLC | |
| Mar-21 | | | Greenrose Acquisition Corp. | | | 4 Cannabis Companies | |
| Sep-20 | | | Trulieve Cannabis Corp. | | | PurePenn, Keystone Relief Centers | |
| Aug-19 | | | TerrAscend Corp. | | | Ilera Healthcare | |
| Jul-19 | | | Curaleaf Holdings, Inc. | | | Grassroots Cannabis | |
| May-19 | | | Curaleaf Holdings, Inc. | | | Select Brand | |
| Apr-19 | | | Canopy Growth Corporation | | | Acreage Holdings, Inc | |
| Mar-19 | | | Curaleaf Holdings Inc. | | | Acres Cannabis | |
| Oct-18 | | | iAnthus Capital Holdings, Inc. | | | MPX Bioceutical Corporation | |
| | | EV / Revenue | | | EV / EBITDA | | ||||||||||||||||||
| | | +1 Years | | | +2 Years | | | +1 Years | | | +2 Years | | ||||||||||||
Minimum | | | | | 0.7x | | | | | | 1.4x | | | | | | 4.3x | | | | | | 3.6x | | |
Average (Excluding High / Low) | | | | | 3.5x | | | | | | 3.7x | | | | | | 12.1x | | | | | | 12.5x | | |
Maximum | | | | | 12.8x | | | | | | 6.3x | | | | | | 25.2x | | | | | | 23.4x | | |
Name and Province or State and Country of Residence | | | Positions(s)/Title | | | Goodness Shares(1) | | | Goodness Options(2) | | | Goodness RSUs | | |||||||||
Kyle E. Kingsley Minnesota, USA | | | Chief Executive Officer, Chair, Director | | | | | 11,641,921 | | | | | | 5,734,176 | | | | | | 262,708 | | |
John A. Heller Minnesota, USA | | | Chief Financial Officer | | | | | 493,103 | | | | | | 1,602,829 | | | | | | 119,413 | | |
Christian Gonzalez Ocasio Puerto Rico | | | Chief Operating Officer | | | | | 521,907 | | | | | | 1,264,943 | | | | | | 99,511 | | |
Amber H. Shimpa Minnesota, USA | | | Chief Administrative Officer and Director | | | | | 3,786,098 | | | | | | 3,159,971 | | | | | | 103,491 | | |
J. Michael Schroeder Florida, USA | | | General Counsel, Chief Compliance Officer, and Secretary | | | | | 943,885 | | | | | | 1,450,168 | | | | | | 99,511 | | |
Stephen Dahmer New York, USA | | | Chief Medical Officer | | | | | 1,237,699 | | | | | | 1,500,241 | | | | | | 99,511 | | |
Harris Rabin New York, USA | | | Chief Marketing Officer | | | | | 115,000 | | | | | | 507,997 | | | | | | 81,201 | | |
Patrick Peters New Jersey, USA | | | Senior Vice President, Retail | | | | | 156,233 | | | | | | 562,465 | | | | | | 79,609 | | |
Chelsea A. Grayson California, USA | | | Director | | | | | 308,189 | | | | | | 505,321 | | | | | | 33,170 | | |
Ross M. Hussey Minnesota, USA | | | Director | | | | | 1,680,300 | | | | | | 132,154 | | | | | | 33,170 | | |
Victor E. Mancebo Florida, USA | | | Director | | | | | — | | | | | | 66,538 | | | | | | 33,170 | | |
Judd T. Nordquist Minnesota, USA | | | Director | | | | | 392,689 | | | | | | 487,728 | | | | | | 33,170 | | |
Name and Province or State and Country of Residence | | Positions(s)/Title | | Goodness Shares(1) | | Goodness Options(2) | | Goodness RSUs | | | Positions(s)/Title | | Goodness Shares(1) | | Goodness Options(2) | | Goodness RSUs | | ||||||||||||||||||||||||||
Kyle E. Kingsley Minnesota, USA | | Chief Executive Officer, Chair, Director | | | | 11,641,921 | | | | | 5,734,176 | | | | | 262,708 | | | ||||||||||||||||||||||||||
John A. Heller Minnesota, USA | | Chief Financial Officer | | | | 493,103 | | | | | 1,602,829 | | | | | 119,413 | | | ||||||||||||||||||||||||||
Christian Gonzalez Ocasio Puerto Rico | | Chief Operating Officer | | | | 521,907 | | | | | 1,264,943 | | | | | 99,511 | | | ||||||||||||||||||||||||||
Amber H. Shimpa Minnesota, USA | | Chief Administrative Officer and Director | | | | 3,786,098 | | | | | 3,159,971 | | | | | 103,491 | | | ||||||||||||||||||||||||||
J. Michael Schroeder Florida, USA | | General Counsel, Chief Compliance Officer, and Secretary | | | | 943,885 | | | | | 1,450,168 | | | | | 99,511 | | | ||||||||||||||||||||||||||
Stephen Dahmer New York, USA | | Chief Medical Officer | | | | 1,237,699 | | | | | 1,500,241 | | | | | 99,511 | | | ||||||||||||||||||||||||||
Harris Rabin New York, USA | | Chief Marketing Officer | | | | 115,000 | | | | | 507,997 | | | | | 81,201 | | | ||||||||||||||||||||||||||
Patrick Peters New Jersey, USA | | Senior Vice President, Retail | | | | 156,233 | | | | | 562,465 | | | | | 79,609 | | | ||||||||||||||||||||||||||
Chelsea A. Grayson California, USA | | Director | | | | 308,189 | | | | | 505,321 | | | | | 33,170 | | | ||||||||||||||||||||||||||
Ross M. Hussey Minnesota, USA | | Director | | | | 1,680,300 | | | | | 132,154 | | | | | 33,170 | | | ||||||||||||||||||||||||||
Victor E. Mancebo Florida, USA | | Director | | | | — | | | | | 66,538 | | | | | 33,170 | | | ||||||||||||||||||||||||||
Judd T. Nordquist Minnesota, USA | | Director | | | | 392,689 | | | | | 487,728 | | | | | 33,170 | | | ||||||||||||||||||||||||||
Josh Rosen Arizona, USA | | Director | | | | 750,014 | | | | | 39,985 | | | | | 16,585 | | | | Director | | | | 750,014 | | | | | 39,985 | | | | | 16,585 | | |
Name/Title | | | Amount of the Benefits (US$)(1)(2)(3) | | |||
Dr. Kyle E. Kingsley, Chief Executive Officer and Chair of the Board | | | | $ | [•] | | |
Amber H. Shimpa, Chief Administrative Officer and Director | | | | $ | [•] | | |
Dr. Stephen Dahmer, Chief Medical Officer | | | | $ | [•] | | |
Ross M. Hussey, Director | | | | $ | [•] | | |
CSE | | | High Trading Price | | | Low Trading Price | | | Volume | | |||||||||
September 2021 | | | | $ | 2.18 | | | | | $ | 1.67 | | | | | | 1,520,550 | | |
October 2021 | | | | $ | 2.15 | | | | | $ | 1.73 | | | | | | 1,605,131 | | |
November 2021 | | | | $ | 1.99 | | | | | $ | 1.46 | | | | | | 4,089,409 | | |
December 2021 | | | | $ | 2.18 | | | | | $ | 1.56 | | | | | | 2,748,854 | | |
January 2022 | | | | $ | 2.19 | | | | | $ | 1.95 | | | | | | 1,614,857 | | |
February 2022 | | | | $ | 3.37 | | | | | $ | 2.45 | | | | | | 10,301,460 | | |
March 2022 | | | | $ | 2.82 | | | | | $ | 2.28 | | | | | | 2,765,359 | | |
April 2022 | | | | $ | 2.70 | | | | | $ | 2.00 | | | | | | 1,670,663 | | |
May 2022 | | | | $ | 2.29 | | | | | $ | 1.81 | | | | | | 1,734,280 | | |
June 2022 | | | | $ | 2.29 | | | | | $ | 1.37 | | | | | | 1,165,892 | | |
July 2022 | | | | $ | 1.83 | | | | | $ | 1.44 | | | | | | 1,015,933 | | |
August 2022 | | | | $ | 1.92 | | | | | $ | 1.27 | | | | | | 1,467,868 | | |
September 1 – 9, 2022 | | | | $ | 1.88 | | | | | $ | 1.64 | | | | | | 169,277 | | |
OTCQX | | | High Trading Price | | | Low Trading Price | | | Volume | | |||||||||
September 2021 | | | | $ | 1.73 | | | | | $ | 1.31 | | | | | | 2,541,442 | | |
October 2021 | | | | $ | 1.75 | | | | | $ | 1.40 | | | | | | 2,553,971 | | |
November 2021 | | | | $ | 1.60 | | | | | $ | 1.22 | | | | | | 7,691,804 | | |
December 2021 | | | | $ | 1.72 | | | | | $ | 1.20 | | | | | | 6,624,405 | | |
January 2022 | | | | $ | 1.79 | | | | | $ | 1.52 | | | | | | 5,001,336 | | |
February 2022 | | | | $ | 2.65 | | | | | $ | 1.92 | | | | | | 11,593,887 | | |
March 2022 | | | | $ | 2.31 | | | | | $ | 1.78 | | | | | | 5,823,900 | | |
April 2022 | | | | $ | 2.15 | | | | | $ | 1.57 | | | | | | 2,252,500 | | |
May 2022 | | | | $ | 1.76 | | | | | $ | 1.41 | | | | | | 1,750,600 | | |
June 2022 | | | | $ | 1.83 | | | | | $ | 1.10 | | | | | | 1,365,600 | | |
July 2022 | | | | $ | 1.42 | | | | | $ | 1.11 | | | | | | 3,305,400 | | |
August 2022 | | | | $ | 1.48 | | | | | $ | 0.98 | | | | | | 2,693,300 | | |
September 1 – 9, 2022 | | | | $ | 1.43 | | | | | $ | 1.25 | | | | | | 177,843 | | |
| Date of Issuance | | | Type of Security | | | Description | | | Issue/Exercise Price | | | Number of Securities | |
| July 9, 2021 | | | Subordinate Voting Shares | | | Option Exercise(4) | | | $0.33 | | | 82,137 | |
| July 22, 2021 | | | Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 720,100 | |
| September 29, 2021 | | | Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 1,222,900 | |
| November 19, 2021 | | | Subordinate Voting Shares | | | Option Exercise(4) | | | $0.19 | | | 300,048 | |
| November 22, 2021 | | | Subordinate Voting Shares | | | Charm Acquisition(5) | | | N/A | | | 1,459,803 | |
| Date of Issuance | | | Type of Security | | | Description | | | Issue/Exercise Price | | | Number of Securities | |
| February 2, 2022 | | | Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 536,100 | |
| February 3, 2022 | | | Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 28,900 | |
| February 10, 2022 | | | Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 974,300 | |
| February 18, 2022 | | | Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 200,000 | |
| March 15, 2022 | | | Goodness Options | | | Option Issuance(1) | | | $1.77 | | | 3,248,108 | |
| March 15, 2022 | | | Goodness RSUs | | | RSU Issuance(3) | | | N/A | | | 1,094,220 | |
| March 29, 2022 | | | Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 74,100 | |
| March 31, 2022 | | | Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 1,000,000 | |
| July 7, 2022 | | | Goodness Growth Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 540,000 | |
| August 2, 2022 | | | Goodness Growth Subordinate Voting Shares | | | Option Exercise(4) | | | $0.33 | | | 15,002 | |
| August 11, 2022 | | | Goodness Growth Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 500,000 | |
| August 16, 2022 | | | Goodness Growth Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 300,100 | |
| September 1, 2022 | | | Goodness Growth Subordinate Voting Shares | | | MVS Conversion(2) | | | N/A | | | 580,100 | |
| Date of Issuance | | Type of Security | | Issue/Exercise Price | | Number of Securities | | Date of Issuance | | Type of Security | | Issue/Exercise Price | | Number of Securities | | ||||||
| July 1, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 647,351.41 | | July 1, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 647,351.41 | | ||||||
| July 2, 2021 | | Verano Proportionate Voting Shares | | $1,998.9729 | | 310 | | July 2, 2021 | | Verano Proportionate Voting Shares | | $1,998.9729 | | 310 | | ||||||
| July 8, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 488,861 | | July 8, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 488,861 | | ||||||
| July 9, 2021 | | Verano RSUs(1) | | N/A | | 20,000 | | July 9, 2021 | | Verano RSUs(1) | | N/A | | 20,000 | | ||||||
| July 12, 2021 | | Verano Subordinate Voting Shares | | C$19.12 | | 6,448,471 | | July 12, 2021 | | Verano Subordinate Voting Shares | | C$19.12 | | 6,448,471 | | ||||||
| July 14, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 12,473,214.01 | | July 14, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 12,473,214.01 | | ||||||
| July 23, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 16,284,588.72 | | July 23, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 16,284,588.72 | | ||||||
| August 2, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 19,059,369.14 | | August 2, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 19,059,369.14 | | ||||||
| August 6, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 14,468,594.22 | | August 6, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 14,468,594.22 | | ||||||
| August 9, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 9,974,253.54 | | August 9, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 9,974,253.54 | | ||||||
| August 11, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 2,098,242.34 | | August 11, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 2,098,242.34 | | ||||||
| August 16, 2021 | | Verano Proportionate Voting Shares | | N/A(2) | | 145,584.1270 | | August 16, 2021 | | Verano Proportionate Voting Shares | | N/A(2) | | 145,584.1270 | | ||||||
| August 18, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 500,000 | | August 18, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 500,000 | | ||||||
| August 20, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 41,039.81 | | August 20, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 41,039.81 | | ||||||
| August 24, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 9,696,873.86 | | August 24, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 9,696,873.86 | | ||||||
| August 30, 2021 | | Verano Subordinate Voting Shares | | N/A(4) | | 785,468 | | August 30, 2021 | | Verano Subordinate Voting Shares | | N/A(4) | | 785,468 | | ||||||
| September 2, 2021 | | Verano Subordinate Voting Shares | | C$14.315 | | 14,400 | | September 2, 2021 | | Verano Subordinate Voting Shares | | C$14.315 | | 14,400 | | ||||||
| September 10, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 2,181,818.09 | | September 10, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 2,181,818.09 | | ||||||
| September 20, 2021 | | Verano Subordinate Voting Shares | | $15.20 | | 37,657 | | September 20, 2021 | | Verano Subordinate Voting Shares | | $15.20 | | 37,657 | | ||||||
| September 20, 2021 | | Verano Proportionate Voting Shares | | $1,520.16 | | 376.56 | | September 20, 2021 | | Verano Proportionate Voting Shares | | $1,520.16 | | 376.56 | | ||||||
| September 24, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 498,104.96 | | September 24, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 498,104.96 | |
| Date of Issuance | | Type of Security | | Issue/Exercise Price | | Number of Securities | | Date of Issuance | | Type of Security | | Issue/Exercise Price | | Number of Securities | | ||||||
| September 28, 2021 | | Verano Subordinate Voting Shares | | C$15.08 | | 132,657 | | September 28, 2021 | | Verano Subordinate Voting Shares | | C$15.08 | | 132,657 | | ||||||
| October 5, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 237,281.85 | | October 5, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 237,281.85 | | ||||||
| October 14, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 59,054,573.51 | | October 14, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 59,054,573.51 | | ||||||
| October 18, 2021 | | Verano Subordinate Voting Shares | | N/A(4) | | 1,332 | | October 18, 2021 | | Verano Subordinate Voting Shares | | N/A(4) | | 1,332 | | ||||||
| October 22, 2021 | | Verano Subordinate Voting Shares | | C$13.625 | | 39,167 | | October 22, 2021 | | Verano Subordinate Voting Shares | | C$13.625 | | 39,167 | | ||||||
| October 25, 2021 | | Verano Subordinate Voting Shares | | $13.5789 | | 727,934 | | October 25, 2021 | | Verano Subordinate Voting Shares | | $13.5789 | | 727,934 | | ||||||
| October 25, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 3,171,303.43 | | October 25, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 3,171,303.43 | | ||||||
| October 28, 2021 | | Verano Proportionate Voting Shares | | C$1,387.00 | | 1,855.1763 | | October 28, 2021 | | Verano Proportionate Voting Shares | | C$1,387.00 | | 1,855.1763 | | ||||||
| October 29, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 463,433.31 | | October 29, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 463,433.31 | | ||||||
| November 5, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 222,841.01 | | November 5, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 222,841.01 | | ||||||
| November 8, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 167,522.7 | | November 8, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 167,522.7 | | ||||||
| November 9, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 4,723,063.51 | | November 9, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 4,723,063.51 | | ||||||
| November 11, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 3,146,986.95 | | November 11, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 3,146,986.95 | | ||||||
| November 16, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 35,408.62 | | November 16, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 35,408.62 | | ||||||
| November 18, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 210,407.52 | | November 18, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 210,407.52 | | ||||||
| November 22, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 378,877.73 | | November 22, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 378,877.73 | | ||||||
| November 24, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 76,919.58 | | November 24, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 76,919.58 | | ||||||
| December 3, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 1,946,227.76 | | December 3, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 1,946,227.76 | | ||||||
| December 3, 2021 | | Verano Subordinate Voting Shares | | C$9.98 | | 1,215,035 | | December 3, 2021 | | Verano Subordinate Voting Shares | | C$9.98 | | 1,215,035 | | ||||||
| December 10, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 126,766.01 | | December 10, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 126,766.01 | | ||||||
| December 17, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 1,827,097.51 | | December 17, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 1,827,097.51 | | ||||||
| December 28, 2021 | | Verano Subordinate Voting Shares | | C$14.07 | | 4,104,787 | | December 28, 2021 | | Verano Subordinate Voting Shares | | C$14.07 | | 4,104,787 | | ||||||
| December 28, 2021 | | Verano Subordinate Voting Shares | | C$14.68 | | 4,040,355 | | December 28, 2021 | | Verano Subordinate Voting Shares | | C$14.68 | | 4,040,355 | | ||||||
| December 30, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 6,861,500.48 | | December 30, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 6,861,500.48 | | ||||||
| December 31, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 14,218 | | December 31, 2021 | | Verano Subordinate Voting Shares | | N/A(3) | | 14,218 | | ||||||
| January 4, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 8,300 | | January 4, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 8,300 | | ||||||
| January 5, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 1,753,484.38 | | January 5, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 1,753,484.38 | | ||||||
| January 12, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 2,584,308.27 | | January 12, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 2,584,308.27 | | ||||||
| January 17, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 2,101,394.97 | | January 17, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 2,101,394.97 | | ||||||
| January 18, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 159,100 | | January 18, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 159,100 | | ||||||
| January 24, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 98,449.45 | | January 24, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 98,449.45 | | ||||||
| February 4, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 164,885.49 | | February 4, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 164,885.49 | | ||||||
| February 16, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 833,272.3 | | February 16, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 833,272.3 | | ||||||
| February 16, 2022 | | Verano RSUs(1) | | N/A | | 253,177 | | February 16, 2022 | | Verano RSUs(1) | | N/A | | 253,177 | | ||||||
| February 22, 2022 | | Verano Subordinate Voting Shares | | C$15.85 | | 166,297 | | February 22, 2022 | | Verano Subordinate Voting Shares | | C$15.85 | | 166,297 | | ||||||
| February 23, 2022 | | Verano Subordinate Voting Shares | | N/A(4) | | 34,320 | | February 23, 2022 | | Verano Subordinate Voting Shares | | N/A(4) | | 34,320 | | ||||||
| February 25, 2022 | | Verano Subordinate Voting Shares | | N/A(4) | | 525,287 | | February 25, 2022 | | Verano Subordinate Voting Shares | | N/A(4) | | 525,287 | | ||||||
| February 25, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 530,679.86 | | February 25, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 530,679.86 | | ||||||
| March 1, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 26,500 | | March 1, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 26,500 | | ||||||
| March 7, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 68,860.65 | | March 7, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 68,860.65 | | ||||||
| March 10, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 17,664 | | March 10, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 17,664 | | ||||||
| March 11, 2022 | | Verano Subordinate Voting Shares | | C$12.58 | | 1,403,067 | | March 11, 2022 | | Verano Subordinate Voting Shares | | C$12.58 | | 1,403,067 | | ||||||
| March 22, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 133,856.92 | | March 22, 2022 | | Verano Subordinate Voting Shares | | N/A(3) | | 133,856.92 | |
| Date of Issuance | | | Type of Security | | | Issue/Exercise Price | | | Number of Securities | |
| April 8, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 2,914.34 | |
| May 6, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 43,395.85 | |
| May 16, 2022 | | | Verano Subordinate Voting Shares | | | N/A(4) | | | 21,600 | |
| May 20, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 32,076 | |
| May 25, 2022 | | | Verano Subordinate Voting Shares | | | N/A(4) | | | 4,970 | |
| May 31, 2022 | | | Verano Subordinate Voting Shares | | | N/A(4) | | | 217,100.48 | |
| June 7, 2022 | | | Verano Subordinate Voting Shares | | | C$13.41 | | | 2,115,438 | |
| June 8, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 24,108 | |
| June 15, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 3,664,052 | |
| June 22, 2022 | | | Verano Subordinate Voting Shares | | | C$9.68 | | | 808,258 | |
| June 23, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 1,735,834.22 | |
| June 23, 2022 | | | Verano RSUs(1) | | | N/A | | | 2,606,401 | |
| June 27, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 42,396.49 | |
| June 30, 2022 | | | Verano Subordinate Voting Shares | | | N/A(4) | | | 292,669 | |
| July 1, 2022 | | | Verano Subordinate Voting Shares | | | N/A(5) | | | 312,150 | |
| July 13, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 192,287.91 | |
| July 19, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 16,002 | |
| July 20, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 6,889 | |
| July 28, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 3,184,604.61 | |
| August 3, 2022 | | | Verano Subordinate Voting Shares | | | C$7.70 | | | 1,195,479 | |
| August 18, 2022 | | | Verano Subordinate Voting Shares | | | N/A(3) | | | 249,449.7 | |
| August 29, 2022 | | | Verano Subordinate Voting Shares | | | N/A(4) | | | 710,635 | |
| September 6, 2022 | | | Verano Subordinate Voting Shares | | | N/A(4) | | | 8,221 | |
| September 7, 2022 | | | Verano Subordinate Voting Shares | | | C$8.33 | | | 1,208,745 | |
Name of Nominee | | | Director Since | | | Residency | | | Principal Occupation(1) | |
Dr. Kyle E. Kingsley | | | March 2019 | | | Minnesota, USA | | | Founder and Chief Executive Officer of Goodness Growth and Chair of the Board | |
Chelsea A. Grayson(2)(3)(4) | | | March 2019 | | | California, USA | | | Executive-in-Residence, Wunderkind (formerly BounceX) | |
Ross M. Hussey(3)(4) | | | July 2020 | | | Minnesota, USA | | | Attorney, Smith Jadin Johnson, PLLC | |
Victor E. Mancebo(2)(3)(4) | | | January 2021 | | | Florida, USA | | | Chief Executive Officer, TheraTrue, Inc. | |
Judd T. Nordquist(2) | | | March 2019 | | | Minnesota, USA | | | CPA and Partner, Abdo L.L.P. | |
Josh Rosen | | | August 2021 | | | Arizona, USA | | | Managing Partner, Bengal Capital | |
Amber H. Shimpa(4) | | | March 2019 | | | Minnesota, USA | | | Chief Administrative Officer of Goodness Growth | |
Name | | | Age* | | | Position | |
Dr. Kyle E. Kingsley | | | 47 | | | Chief Executive Officer and Chair of the Board | |
Chelsea A. Grayson | | | 50 | | | Director | |
Ross M. Hussey | | | 44 | | | Director | |
Victor E. Mancebo | | | 38 | | | Director | |
Judd T. Nordquist | | | 52 | | | Director | |
Josh Rosen | | | 49 | | | Director | |
Amber H. Shimpa | | | 43 | | | Chief Administrative Officer and Director | |
Dr. Stephen Dahmer | | | 47 | | | Chief Medical Officer | |
John A. Heller | | | 54 | | | Chief Financial Officer | |
Christian Gonzalez | | | 41 | | | Chief Operating Officer | |
Patrick Peters | | | 48 | | | Executive Vice President, Retail | |
Harris Rabin | | | 47 | | | Chief Marketing Officer | |
J. Michael Schroeder | | | 55 | | | General Counsel, Chief Compliance Officer, and Secretary | |
Director Name | | | Audit Committee | | | Compensation Committee | | | N&G Committee | |
Dr. Kyle E. Kingsley | | | | | | | | | | |
Chelsea A. Grayson | | | Member | | | Member | | | Chair | |
Ross M. Hussey | | | | | | Chair | | | Member | |
Victor E. Mancebo | | | Member | | | Member | | | Member | |
Judd T. Nordquist | | | Chair | | | | | | | |
Josh Rosen | | | | | | | | | | |
Amber H. Shimpa | | | | | | | | | Member | |
Name and Principal Position | | | Fees Earned or Paid in Cash ($) | | | Option Awards ($)(1) | | | Stock Awards ($) | | | Total ($) | | ||||||||||||
Chelsea A. Grayson | | | | | 71,000 | | | | | | 98,683 | | | | | | 58,711 | | | | | | 228,394 | | |
Ross M. Hussey | | | | | 71,000 | | | | | | 37,580 | | | | | | 58,711 | | | | | | 167,291 | | |
Victor E. Mancebo(2) | | | | | 68,042 | | | | | | 37,507 | | | | | | 58,711 | | | | | | 164,260 | | |
Judd T. Nordquist | | | | | 71,000 | | | | | | 87,683 | | | | | | 58,711 | | | | | | 217,394 | | |
Josh Rosen(3) | | | | | 27,204 | | | | | | 25,000 | | | | | | 29,320 | | | | | | 81,524 | | |
Plan Category | | | Number of securities to be issued upon exercise of outstanding options, warrants and rights | | | Weighted-average exercise price of outstanding options, warrants and rights | | | Number of securities remaining available for future issuance under equity compensation plans | | |||||||||
Equity compensation plans approved by security holders | | | | | 7,205,496 | | | | | $ | 1.14 | | | | | | 5,605,637 | | |
Equity compensation plans not approved by security holders | | | | | 16,020,842 | | | | | $ | 0.30 | | | | | | — | | |
Total | | | | | 23,226,338 | | | | | $ | 0.47 | | | | | | 5,605,637 | | |
Name and Principal Position | | | Year | | | Salary ($) | | | Option Awards ($) | | | All Other Compensation ($)(1) | | | Total ($) | | |||||||||||||||
Dr. Kyle E. Kingsley Chief Executive Officer | | | | | 2021 | | | | | | 360,000 | | | | | | — | | | | | | 176 | | | | | | 360,176 | | |
| | | 2020 | | | | | | 295,269 | | | | | | — | | | | | | 176 | | | | | | 295,445 | | | ||
John A. Heller Chief Financial Officer | | | | | 2021 | | | | | | 300,000 | | | | | | — | | | | | | 176 | | | | | | 300,176 | | |
| | | 2020 | | | | | | 133,333 | | | | | | 827,249 | | | | | | 176 | | | | | | 960,758 | | | ||
Christian Gonzalez Chief Operating Officer | | | | | 2021 | | | | | | 250,000 | | | | | | — | | | | | | 176 | | | | | | 250,176 | | |
| | | 2020 | | | | | | 217,150 | | | | | | 486,783 | | | | | | — | | | | | | 703,933 | | |
Name | | | Number of Securities Underlying Unexercised Options (#) Exercisable | | | Number of Securities Underlying Unexercised Options (#) Unexercisable | | | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | | | Option Exercise Price ($) | | | Option Expiration Date | | ||||||||||||
Dr. Kyle E. Kingsley | | | | | 5,063,315 | | | | | | 37,506(1) | | | | | | — | | | | | $ | 0.33 | | | | May 1, 2023 | |
John A. Heller | | | | | 410,919 | | | | | | 904,022(2) | | | | | | — | | | | | $ | 0.77 | | | | September 10, 2030 | |
Christian Gonzalez | | | | | 125,000 | | | | | | 375,000(3) | | | | | | — | | | | | $ | 1.19 | | | | November 29, 2030 | |
| | | | | 150,000 | | | | | | 150,000(4) | | | | | | — | | | | | $ | 1.13 | | | | December 2, 2029 | |
| | | | | 112,518 | | | | | | 37,506(5) | | | | | | — | | | | | $ | 0.33 | | | | December 21, 2028 | |
| | | | | 70,324 | | | | | | 4,688(1) | | | | | | — | | | | | $ | 0.33 | | | | May 1, 2028 | |
| | | Subordinate Voting Shares | | | Multiple Voting Shares | | | Super Voting Shares | | | Total(1) | | | Voting(2) | | |||||||||||||||||||||||||||||||||||||||
Name and Address of Beneficial Owner | | | Number Beneficially Owned | | | % of Total Subordinate Voting Shares | | | Number Beneficially Owned | | | % of Total Multiple Voting Shares | | | Number Beneficially Owned | | | % of Total Super Voting Shares | | | Total Number of Capital Stock Beneficially Owned | | | % of Total Capital Stock | | | % of Voting Capital Stock | | |||||||||||||||||||||||||||
Dumont Global LP(3) | | | | | 4,545,000 | | | | | | 5.3% | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 4,545,000 | | | | | | 3.5% | | | | | | 2.4% | | |
NEOs and Directors | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Dr. Kyle E. Kingsley(4) | | | | | 5,100,821(3) | | | | | | 5.9% | | | | | | — | | | | | | — | | | | | | 65,411 | | | | | | 100% | | | | | | 11,641,921 | | | | | | 9.1% | | | | | | 37.7% | | |
John A. Heller(4) | | | | | 657,471 | | | | | | * | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 575,287 | | | | | | * | | | | | | * | | |
Christian Gonzalez(4) | | | | | 640,660 | | | | | | * | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 581,283 | | | | | | * | | | | | | * | | |
Chelsea A. Grayson(4) | | | | | 347,489 | | | | | | * | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 347,489 | | | | | | * | | | | | | * | | |
Ross M. Hussey(7) | | | | | 72,049 | | | | | | — | | | | | | 16,803 | | | | | | 4.7% | | | | | | — | | | | | | — | | | | | | 1,752,349 | | | | | | 1.4% | | | | | | * | | |
Victor E. Mancebo(4) | | | | | 6,550 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 6,550 | | | | | | * | | | | | | * | | |
Judd T. Nordquist(7) | | | | | 347,489 | | | | | | * | | | | | | 845 | | | | | | * | | | | | | — | | | | | | — | | | | | | 431,989 | | | | | | * | | | | | | * | | |
Josh Rosen(5) | | | | | 750,014 | | | | | | * | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 750,014 | | | | | | * | | | | | | * | | |
Amber H. Shimpa(6) | | | | | 2,933,998 | | | | | | 3.4% | | | | | | 8,521 | | | | | | 2.4% | | | | | | — | | | | | | — | | | | | | 3,786,098 | | | | | | 3.0% | | | | | | 2.0% | | |
Directors and executive officers as a group (13 persons)(7) | | | | | 14,255,715 | | | | | | 16.6% | | | | | | 26,169 | | | | | | 7.4% | | | | | | 65,411 | | | | | | 100% | | | | | | 23,093,673 | | | | | | 18.3% | | | | | | 44.0% | | |
| | | 2021 | | | 2020 | | ||||||
Audit Fees | | | | $ | 718,120 | | | | | $ | 428,140 | | |
Audit-Related Fees(1) | | | | $ | — | | | | | $ | 175,364 | | |
Tax Fees(2) | | | | $ | 28,622 | | | | | $ | 28,489 | | |
All Other Fees | | | | | — | | | | | | — | | |
Total | | | | $ | 746,742 | | | | | $ | 641,993 | | |
Name of Expert | | | Nature of Relationship | |
Hyperion(1) | | | Authors responsible for the preparation of the Hyperion Fairness Opinion | |
Cormark(1) | | | Authors responsible for the preparation of the Cormark Fairness Opinion | |
Davidson & Company LLP | | | Auditors of Goodness Growth | |
| | | | | B-1 | | | |
| | | | | B-1 | | | |
| | | | | B-13 | | | |
| | | | | B-14 | | | |
| | | | | B-15 | | | |
| | | | | B-15 | | | |
| | | | | B-15 | | | |
| | | | | B-16 | | | |
| | | | | B-17 | | | |
| | | | | B-19 | | | |
| | | | | B-19 | | | |
| | | | | B-19 | | | |
| | | | | B-20 | | | |
| | | | | B-20 | | | |
| | | | | B-20 | | | |
| | | | | B-21 | | | |
| | | | | B-21 | | | |
| | | | | B-21 | | | |
| | | | | B-21 | | | |
| | | | | B-22 | | | |
| | | | | B-22 | | | |
| | | | | B-22 | | | |
| | | | | B-22 | | | |
| | | | | B-22 | | | |
| | | | | B-26 | | | |
| | | | | B-27 | | | |
| | | | | B-27 | | | |
| | | | | B-28 | | | |
| | | | | B-30 | | | |
| | | | | B-30 | | | |
| | | | | B-31 | | | |
| | | | | B-31 | | | |
| | | | | B-32 | | | |
| | | | | B-32 | | | |
| | | | | B-32 | | | |
| | | | | B-32 | | | |
| | | | | B-33 | | | |
| | | | | B-34 | | | |
| | | | | B-34 | | | |
| | | | | B-36 | | | |
| | | | | B-36 | | | |
| | | | | B-36 | | | |
| | | | | B-37 | | |
| | | | | B-37 | | | |
| | | | | B-38 | | | |
| | | | | B-38 | | | |
| | | | | B-38 | | | |
| | | | | B-38 | | | |
| | | | | B-39 | | | |
| | | | | B-40 | | | |
| | | | | B-42 | | | |
| | | | | B-42 | | | |
| | | | | B-42 | | | |
| | | | | B-42 | | | |
| | | | | B-43 | | | |
| | | | | B-43 | | | |
| | | | | B-43 | | | |
| | | | | B-44 | | | |
| | | | | B-44 | | | |
| | | | | B-44 | | | |
| | | | | B-44 | | | |
| | | | | B-44 | | | |
| | | | | B-45 | | | |
| | | | | B-45 | | | |
| | | | | B-45 | | |
| SCHEDULE A | | | FORM OF PLAN OF ARRANGEMENT | |
| SCHEDULE B | | | ARRANGEMENT RESOLUTION | |
| SCHEDULE C | | | REPRESENTATIONS AND WARRANTIES OF THE COMPANY | |
| SCHEDULE D | | | REPRESENTATIONS AND WARRANTIES OF THE PURCHASER | |
| | | Hyperion Capital Inc. 12 Sudbury — 1401 Toronto, Ontario Canada M6J 3W7 T: 416-716-1982 www.hyperioncap.com | |
| | | Cormark Securities Inc. Royal Bank Plaza, North Tower 200 Bay Street, Suite 1800 Toronto, ON M5J 2J2 | |
2021 Acquisition Date | | | Entity | | | Location | | | Business | |
March 9, 2021 | | | NSE Holdings, LLC | | | Pennsylvania | | | Dispensaries | |
March 10, 2021 | | | Perpetual Healthcare Inc. | | | Arizona | | | Dispensary | |
March 17, 2021 | | | The Herbal Care Center, Inc. | | | Illinois | | | Dispensaries | |
March 30, 2021 | | | Patient Alternative Relief Center, Inc. | | | Arizona | | | Cultivation and dispensary | |
April 8, 2021 | | | AZGM3, Inc., Vending Logistics LLC and The Medicine Room, LLC | | | Arizona | | | Cultivation, production and dispensaries | |
May 11, 2021 | | | TerraVida Holistic Centers, LLC | | | Pennsylvania | | | Dispensaries | |
May 14, 2021 | | | The Healing Center, LLC | | | Pennsylvania | | | Dispensaries | |
June 30, 2021 | | | Ohio Grown Therapies, LLC | | | Ohio | | | Dispensary | |
July 1, 2021 | | | Green RX, LLC | | | Ohio | | | Dispensary | |
July 8, 2021 | | | Mad River Remedies, LLC | | | Ohio | | | Dispensary | |
July 12, 2021 | | | Agri-Kind, LLC and Agronomed Holdings, Inc. | | | Pennsylvania | | | Cultivation and production | |
July 12, 2021 | | | Agronomed Biologics, LLC | | | Pennsylvania | | | Dispensaries and medical research | |
October 25, 2021 | | | Willow Brook Wellness, LLC | | | Connecticut | | | Dispensary | |
December 20, 2021 | | | Caring Nature, LLC | | | Connecticut | | | Dispensary | |
December 28, 2021 | | | Connecticut Pharmaceutical Solutions, Inc. | | | Connecticut | | | Cultivation and production | |
State | | | License or Permit | | | Type | | | Number Held | |
Arizona | | | Dispensary/Processor/Cultivator | | | Adult-use | | | Six | |
Arizona | | | Dispensary/Processor/Cultivator | | | Medical | | | Six | |
California | | | Distributor | | | Adult-use & Medical | | | Two | |
California | | | Manufacturing | | | Adult-use & Medical | | | One | |
California | | | Facility | | | Distribution | | | One | |
California | | | Facility | | | Manufacturing | | | One | |
California | | | Cultivation | | | Adult-use | | | One | |
Connecticut | | | Dispensary | | | Medical | | | Two | |
Connecticut | | | Producer | | | Medical | | | One | |
Connecticut | | | Manufacturer | | | Hemp Consumables | | | One | |
Florida | | | Dispensary/Processor/Cultivator | | | Medical | | | One | |
Illinois | | | Cultivation | | | Medical | | | One | |
Illinois | | | Cultivation | | | Adult-use | | | One | |
Illinois | | | Processor | | | Industrial Hemp | | | One | |
Illinois | | | Dispensary | | | Medical | | | Five | |
Illinois | | | Dispensary | | | Adult-use | | | Ten | |
Maryland | | | Dispensary | | | Medical | | | Two | |
Maryland | | | Cultivation | | | Medical | | | One | |
Maryland | | | Processor | | | Medical | | | One | |
Massachusetts | | | Cultivation | | | Medical | | | One | |
Massachusetts | | | Cultivation | | | Adult-use | | | One | |
Massachusetts | | | Processor | | | Medical | | | One | |
Massachusetts | | | Processor | | | Adult-use | | | One | |
Massachusetts | | | Dispensary | | | Medical | | | One | |
Massachusetts | | | Dispensary | | | Adult-use | | | Two | |
Nevada | | | Dispensary | | | Medical | | | One | |
State | | | License or Permit | | | Type | | | Number Held | |
Nevada | | | Dispensary | | | Adult-use | | | Three | |
Nevada | | | Processing | | | Medical | | | One | |
Nevada | | | Processing | | | Adult-use | | | One | |
Nevada | | | Cultivation | | | Medical | | | One | |
Nevada | | | Cultivation | | | Adult-use | | | One | |
Ohio | | | Dispensary | | | Medical | | | Five | |
Ohio | | | Cultivation | | | Medical | | | One | |
Ohio | | | Processing | | | Medical | | | One | |
Pennsylvania | | | Dispensary | | | Medical | | | Eighteen | |
Pennsylvania | | | Cultivation/Processor | | | Medical | | | Two | |
State | | | License or Permit | | | Type | | | Number Held | |
Arkansas | | | Dispensary | | | Medical | | | One | |
Maryland | | | Dispensary | | | Medical | | | Two | |
Michigan | | | Dispensary | | | Medical | | | One | |
Michigan | | | Dispensary | | | Adult-use | | | One | |
New Jersey | | | Cultivation/Processing | | | Medical | | | One | |
New Jersey | | | Cultivation/Processing | | | Adult-use | | | One | |
New Jersey | | | Dispensary | | | Medical | | | Three | |
New Jersey | | | Dispensary | | | Adult-use | | | Three | |
West Virginia | | | Dispensary | | | Medical | | | Seven | |
West Virginia | | | Processor | | | Medical | | | One | |
West Virginia | | | Cultivation | | | Medical | | | One | |
Property Type | | | Owned/ Leased | | | County | | | State | |
Arizona: | | | | | | | | | | |
two cultivation facilities and six dispensary sites | | | | | | | | | | |
Cultivation facility | | | Owned | | | Navajo County | | | Arizona | |
Cultivation facility | | | Owned | | | Pinal County | | | Arizona | |
Dispensaries (five) | | | Leased | | | Maricopa County | | | Arizona | |
Property Type | | | Owned/ Leased | | | County | | | State | |
Dispensary | | | Owned | | | Maricopa County | | | Arizona | |
Arkansas: | | | | | | | | | | |
one dispensary site | | | | | | | | | | |
Dispensary | | | Owned | | | Union County | | | Arkansas | |
Connecticut: | | | | | | | | | | |
one cultivation facility and two dispensary sites | | | | | | | | | | |
Cultivation facility | | | Owned | | | Hartford County | | | Connecticut | |
Dispensary (two) | | | Leased | | | New Haven County | | | Connecticut | |
Florida: | | | | | | | | | | |
one call center, two cultivation facilities, forty-five dispensary sites, four dispensary sites under construction and two planned dispensary sites | | | | | | | | | | |
Call Center | | | Owned | | | Hillsborough County | | | Florida | |
Cultivation facility | | | Owned | | | Hillsborough County | | | Florida | |
Cultivation facility | | | Owned | | | Putnam County | | | Florida | |
Dispensaries (two) | | | Leased | | | Manatee County | | | Florida | |
Dispensaries (three and one planned) | | | Leased | | | Lee County | | | Florida | |
Dispensaries (three) | | | Leased | | | Palm Beach County | | | Florida | |
Dispensaries (four) | | | Leased | | | Pinellas County | | | Florida | |
Dispensaries (one and one planned) | | | Leased | | | Broward County | | | Florida | |
Dispensary | | | Leased | | | Alachua County | | | Florida | |
Dispensaries (two) | | | Leased | | | Duval County | | | Florida | |
Dispensary | | | Leased | | | Monroe County | | | Florida | |
Dispensary | | | Leased | | | Lake County | | | Florida | |
Dispensary | | | Leased | | | Polk County | | | Florida | |
Dispensaries (eight) | | | Leased | | | Hillsborough County | | | Florida | |
Dispensary | | | Leased | | | Brevard County | | | Florida | |
Dispensary | | | Owned | | | Brevard County | | | Florida | |
Dispensaries (one and one under construction) | | | Leased | | | Miami-Dade County | | | Florida | |
Dispensaries (two) | | | Leased | | | Sarasota County | | | Florida | |
Dispensaries (two) | | | Leased | | | Volusia County | | | Florida | |
Dispensaries (two) | | | Leased | | | Orange County | | | Florida | |
Dispensary | | | Leased | | | Escambia County | | | Florida | |
Dispensary | | | Leased | | | St. Lucie County | | | Florida | |
Dispensary | | | Leased | | | Indian River County | | | Florida | |
Dispensary | | | Leased | | | Okaloosa County | | | Florida | |
Dispensary | | | Leased | | | Pasco County | | | Florida | |
Dispensary | | | Leased | | | St. Johns County | | | Florida | |
Dispensary | | | Owned | | | Seminole County | | | Florida | |
Dispensary | | | Owned | | | Leon County | | | Florida | |
Dispensary (under construction) | | | Leased | | | Martin County | | | Florida | |
Dispensary (under construction) | | | Leased | | | Charlotte County | | | Florida | |
Dispensary | | | Leased | | | Clay County | | | Florida | |
Property Type | | | Owned/ Leased | | | County | | | State | |
Dispensary (under construction) | | | Leased | | | Collier County | | | Florida | |
Illinois: | | | | | | | | | | |
one corporate office, one cultivation facility, ten dispensary sites and one planned dispensary site | | | | | | | | | | |
Corporate office | | | Leased | | | Cook County | | | Illinois | |
Cultivation facility | | | Owned | | | Edwards County | | | Illinois | |
Dispensaries (five and one planned) | | | Leased | | | Cook County | | | Illinois | |
Dispensary | | | Leased | | | Kane County | | | Illinois | |
Dispensary | | | Leased | | | Lake County | | | Illinois | |
Dispensaries (three) | | | Leased | | | DuPage County | | | Illinois | |
Maryland: | | | | | | | | | | |
one cultivation facility, four dispensary sites and one dispensary site under construction | | | | | | | | | | |
Cultivation facility | | | Owned | | | Howard County | | | Maryland | |
Dispensary | | | Owned | | | Anne Arundel County | | | Maryland | |
Dispensary | | | Leased | | | Baltimore County | | | Maryland | |
Dispensary | | | Leased | | | Montgomery County | | | Maryland | |
Dispensary (under construction) | | | Leased | | | Anne Arundel County | | | Maryland | |
Dispensary | | | Owned | | | Howard County | | | Maryland | |
Massachusetts: | | | | | | | | | | |
one cultivation facility and two dispensary sites | | | | | | | | | | |
Cultivation facility | | | Owned | | | Norfolk County | | | Massachusetts | |
Dispensary | | | Leased | | | Norfolk County | | | Massachusetts | |
Dispensary | | | Leased | | | Plymouth County | | | Massachusetts | |
Michigan: | | | | | | | | | | |
one dispensary site | | | | | | | | | | |
Dispensary | | | Owned | | | Berrien County | | | Michigan | |
Nevada: | | | | | | | | | | |
one cultivation facility, three dispensary sites and one dispensary site under construction | | | | | | | | | | |
Cultivation facility | | | Owned | | | Clark County | | | Nevada | |
Dispensaries (one and one under construction) | | | Owned | | | Clark County | | | Nevada | |
Dispensary (two) | | | Leased | | | Clark County | | | Nevada | |
New Jersey: | | | | | | | | | | |
one cultivation facility and three dispensary sites | | | | | | | | | | |
Cultivation facility | | | Owned | | | Hunterdown County | | | New Jersey | |
Dispensary | | | Leased | | | Monmouth | | | New Jersey | |
Dispensary | | | Leased | | | Mercer | | | New Jersey | |
Dispensary | | | Leased | | | Union | | | New Jersey | |
Ohio: | | | | | | | | | | |
one cultivation facility and five dispensary sites | | | | | | | | | | |
Cultivation facility | | | Owned | | | Stark County | | | Ohio | |
Dispensary | | | Owned | | | Licking County | | | Ohio | |
Property Type | | | Owned/ Leased | | | County | | | State | |
Dispensary | | | Leased | | | Montgomery | | | Ohio | |
Dispensary | | | Leased | | | Hamilton | | | Ohio | |
Dispensary | | | Leased | | | Wood County | | | Ohio | |
Dispensary | | | Owned | | | Stark County | | | Ohio | |
Pennsylvania: | | | | | | | | | | |
one cultivation facility, twelve dispensary sites, a cultivation facility under construction and four dispensary sites under construction | | | | | | | | | | |
Cultivation facility | | | Owned | | | Chester County | | | Pennsylvania | |
Cultivation facility (under construction) | | | Owned | | | Chester County | | | Pennsylvania | |
Dispensary | | | Leased | | | Philadelphia County | | | Pennsylvania | |
Dispensary | | | Leased | | | Dauphin | | | Pennsylvania | |
Dispensary | | | Leased | | | Logan County | | | Pennsylvania | |
Dispensary | | | Leased | | | York County | | | Pennsylvania | |
Dispensary and office | | | Leased | | | Montgomery | | | Pennsylvania | |
Dispensary and office (under construction) | | | Owned | | | Montgomery | | | Pennsylvania | |
Dispensary (under construction) | | | Owned | | | Montgomery | | | Pennsylvania | |
Dispensary | | | Leased | | | Bucks | | | Pennsylvania | |
Dispensary (one and one under construction) | | | Leased | | | Delaware | | | Pennsylvania | |
Dispensary (under construction) | | | Leased | | | Westmoreland | | | Pennsylvania | |
Dispensary | | | Owned | | | Venango | | | Pennsylvania | |
Dispensary | | | Owned | | | Allegheny | | | Pennsylvania | |
Dispensary | | | Owned | | | Washington | | | Pennsylvania | |
Dispensary | | | Leased | | | Chester County | | | Pennsylvania | |
Dispensary | | | Owned | | | Chester County | | | Pennsylvania | |
West Virginia: | | | | | | | | | | |
one cultivation facility, one dispensary site and four dispensary sites under construction | | | | | | | | | | |
Cultivation facility | | | Leased | | | Raleigh | | | West Virginia | |
Dispensary (one and one under construction) | | | Leased | | | Monongalia | | | West Virginia | |
Dispensary (under construction) | | | Leased | | | Harrison | | | West Virginia | |
Dispensary (under construction) | | | Leased | | | Ohio | | | West Virginia | |
Dispensary (under construction) | | | Leased | | | Upshur | | | West Virginia | |
Month | | | High | | | Low | | | Aggregate Volume | | |||||||||
September 2021 | | | | C$ | 16.30 | | | | | C$ | 13.90 | | | | | | 6,236,784 | | |
October 2021 | | | | C$ | 14.49 | | | | | C$ | 12.75 | | | | | | 6,453,306 | | |
November 2021 | | | | C$ | 18.78 | | | | | C$ | 12.30 | | | | | | 12,949,376 | | |
December 2021 | | | | C$ | 15.99 | | | | | C$ | 12.64 | | | | | | 7,777,047 | | |
January 2022 | | | | C$ | 17.45 | | | | | C$ | 12.78 | | | | | | 6,443,985 | | |
February 2022 | | | | C$ | 16.65 | | | | | C$ | 12.81 | | | | | | 11,053,470 | | |
March, 2022 | | | | C$ | 13.57 | | | | | C$ | 11.22 | | | | | | 5,945,872 | | |
April, 2022 | | | | C$ | 12.64 | | | | | C$ | 9.45 | | | | | | 7,633,717 | | |
May 2022 | | | | C$ | 10.46 | | | | | C$ | 8.70 | | | | | | 5,211,592 | | |
June 2022 | | | | C$ | 10.76 | | | | | C$ | 7.15 | | | | | | 5,563,948 | | |
July 2022 | | | | C$ | 8.99 | | | | | C$ | 6.76 | | | | | | 2,889,280 | | |
August 2022 | | | | C$ | 9.36 | | | | | C$ | 6.00 | | | | | | 8,177,019 | | |
September 1 – 9, 2022 | | | | C$ | 9.00 | | | | | C$ | 7.91 | | | | | | 1,198,825 | | |
Plan Category | | | Number of securities to be issued upon exercise of outstanding options, warrants and rights(1) | | | Weighted-average exercise price of outstanding options, warrants and rights(2) | | | Number of securities remaining available for future issuance under equity compensation plans (excluding securities issuable upon exercise of outstanding options, warrants and rights)(3) | |
Equity compensation plans approved by securityholders | | | | | | | | | | |
Equity Incentive Plan | | | 2,706,200 Verano Subordinate Voting Shares | | | $23.70 | | | 28,676,557 Verano Subordinate Voting Shares | |
Equity Compensation plans not approved by security holders | | | | | | | | | | |
None | | | | | | | | | | |
Total | | | 2,706,200 Verano Subordinate Voting Shares | | | $23.70 | | | 28,676,557 Verano Subordinate Voting Shares | |
Security | | | Number Issued and Outstanding of Each Class | | |||
Verano Subordinate Voting Shares | | | | | 318,946,319 | | |
Verano Proportionate Voting Shares | | | | | 136,726(1) | | |
Indebtedness for Borrowed Money | | | | $ | 403,000,000(2) | | |
Month | | | High | | | Low | | | Aggregate Volume | | |||||||||
September 2021 | | | | C$ | 16.30 | | | | | C$ | 13.90 | | | | | | 6,236,784 | | |
October 2021 | | | | C$ | 14.49 | | | | | C$ | 12.75 | | | | | | 6,453,306 | | |
November 2021 | | | | C$ | 18.78 | | | | | C$ | 12.30 | | | | | | 12,949,376 | | |
December 2021 | | | | C$ | 15.99 | | | | | C$ | 12.64 | | | | | | 7,777,047 | | |
January 2022 | | | | C$ | 17.45 | | | | | C$ | 12.78 | | | | | | 6,443,985 | | |
February 2022 | | | | C$ | 16.65 | | | | | C$ | 12.81 | | | | | | 11,053,470 | | |
March, 2022 | | | | C$ | 13.57 | | | | | C$ | 11.22 | | | | | | 5,945,872 | | |
April, 2022 | | | | C$ | 12.64 | | | | | C$ | 9.45 | | | | | | 7,633,717 | | |
May 2022 | | | | C$ | 10.46 | | | | | C$ | 8.70 | | | | | | 5,211,592 | | |
June 2022 | | | | C$ | 10.76 | | | | | C$ | 7.15 | | | | | | 5,563,948 | | |
July 2022 | | | | C$ | 8.99 | | | | | C$ | 6.76 | | | | | | 2,889,280 | | |
August 2022 | | | | C$ | 9.36 | | | | | C$ | 6.00 | | | | | | 8,177,019 | | |
September 1 – 9, 2022 | | | | C$ | 9.00 | | | | | C$ | 7.91 | | | | | | 1,198,825 | | |
| (a) Verano Holdings Corp. Consolidated Financial Statements for the years ended December 31, 2021, 2020 and 2019 | | | | | | | |
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| (b) Plants of Ruskin, LLC D/B/A AltMed Florida Plants of Ruskin GPS, LLC, RVC 360, LLC (“POR”) Combined Financial Statements as of December 31, 2020 and 2019 and for the Two Years Ended December 31, 2020 | | | | | | | |
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| (c) AltMed Enterprises Group of Companies (“AME”): Agronomy Innovations LLC, Fort Consulting LLC, Agronomy Holdings LLC, Alternative Medical Enterprises LLC, AltMed LLC, Cave Creek Real Estate LLC, MuV Health LLC, and NuTrae LLC Consolidated Financial Statements as of December 31, 2020 and for the Year Ended December 31, 2020 | | | | | | | |
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| (d) AltMed Enterprises Group of Companies (“AME”): Agronomy Innovations LLC, Fort Consulting LLC, Agronomy Holdings LLC, Alternative Medical Enterprises LLC, AltMed LLC, Cave Creek Real Estate LLC, MuV Health LLC, and NuTrae LLC Consolidated Financial Statements as of December 31, 2019 and for the Year Ended December 31, 2019 | | | | | | | |
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| (e) Verano Holdings Corp. Unaudited Interim Condensed Consolidated Financial Statements as of and for the three months ended March 31, 2022 and 2021 | | | | | | | |
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| (f) Unaudited Pro Forma Financial Information | | | | | | | |
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CONSOLIDATED FINANCIAL STATEMENTS: | | | | | | | |
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| | | 2021 | | | 2020 | | ||||||
| | | (As Restated) | | | | | | | | |||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 99,118 | | | | | $ | 16,402 | | |
Accounts Receivable, net | | | | | 17,410 | | | | | | 7,270 | | |
Notes Receivable | | | | | 285 | | | | | | 3,945 | | |
Due from Related Parties | | | | | — | | | | | | 108 | | |
Inventory | | | | | 140,703 | | | | | | 37,354 | | |
Prepaid Expenses and Other Current Assets | | | | | 19,528 | | | | | | 6,169 | | |
Total Current Assets | | | | | 277,044 | | | | | | 71,248 | | |
Property, Plant and Equipment, net | | | | | 452,232 | | | | | | 144,182 | | |
Right Of Use Assets, net | | | | | 61,346 | | | | | | 11,784 | | |
Intangible Assets, net | | | | | 1,379,913 | | | | | | 72,419 | | |
Goodwill | | | | | 368,130 | | | | | | 16,029 | | |
Investment in Associates | | | | | 7,491 | | | | | | 11,547 | | |
Deposits and Other Assets | | | | | 2,499 | | | | | | 2,442 | | |
TOTAL ASSETS | | | | $ | 2,548,655 | | | | | $ | 329,651 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 45,172 | | | | | $ | 18,293 | | |
Accrued Liabilities | | | | | 42,149 | | | | | | 13,886 | | |
Income Tax Payable | | | | | 154,512 | | | | | | 41,158 | | |
Current Portion of Lease Liabilities | | | | | 6,563 | | | | | | 1,803 | | |
Current Portion of Notes Payable | | | | | 13,771 | | | | | | 7,814 | | |
Acquisition Consideration Payable | | | | | 208,349 | | | | | | 33,290 | | |
Due to Related Parties | | | | | — | | | | | | 45 | | |
Total Current Liabilities | | | | | 470,516 | | | | | | 116,289 | | |
Long-Term Liabilities: | | | | | | | | | | | | | |
Deferred Revenue | | | | | 1,183 | | | | | | 2,036 | | |
Notes Payable, net of Current Portion | | | | | 276,154 | | | | | | 32,480 | | |
Lease Liabilities, net of Current Portion | | | | | 56,812 | | | | | | 10,624 | | |
Deferred Income Taxes | | | | | 262,184 | | | | | | 14,824 | | |
Total Long-Term Liabilities | | | | | 596,333 | | | | | | 59,964 | | |
TOTAL LIABILITIES | | | | $ | 1,066,849 | | | | | $ | 176,253 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,480,530 | | | | | | 147,161 | | |
NON-CONTROLLING INTEREST | | | | | 1,276 | | | | | | 6,237 | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,548,655 | | | | | $ | 329,651 | | |
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Revenues, net of discounts | | | | $ | 737,850 | | | | | $ | 228,530 | | | | | $ | 65,968 | | |
Cost of Goods Sold, net | | | | | 406,831 | | | | | | 92,961 | | | | | | 29,928 | | |
Gross Profit | | | | | 331,019 | | | | | | 135,569 | | | | | | 36,040 | | |
Operating Expenses: | | | | | | | | | | | | | | | | | | | |
General and Administrative | | | | | 100,903 | | | | | | 23,838 | | | | | | 29,692 | | |
Sales and Marketing | | | | | 8,644 | | | | | | 919 | | | | | | 926 | | |
Salaries and Benefits | | | | | 119,598 | | | | | | 16,228 | | | | | | 6,231 | | |
Depreciation and Amortization | | | | | 41,784 | | | | | | 2,278 | | | | | | 2,288 | | |
Total Operating Expenses | | | | | 270,929 | | | | | | 43,263 | | | | | | 39,137 | | |
Income (Loss) from Investments in Associates | | | | | 4,623 | | | | | | 2,692 | | | | | | (456) | | |
Income (Loss) From Operations | | | | | 64,713 | | | | | | 94,998 | | | | | | (3,553) | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | |
(Loss) on Disposal of Property, Plant and Equipment | | | | | (1,085) | | | | | | (1,655) | | | | | | (1,546) | | |
(Loss) on Deconsolidation | | | | | — | | | | | | (189) | | | | | | (3,087) | | |
Gain on Previously Held Equity Interest | | | | | — | | | | | | 457 | | | | | | — | | |
Amortization of Debt Issuance Costs for Warrant | | | | | — | | | | | | (3,018) | | | | | | (425) | | |
Amortization of Convertible Debt Discount | | | | | — | | | | | | (2,912) | | | | | | (364) | | |
Other Income (Expense), net | | | | | 9,632 | | | | | | (701) | | | | | | 94 | | |
Interest Income (Expense), net | | | | | (24,270) | | | | | | (4,528) | | | | | | 390 | | |
Total Other Expense | | | | | (15,723) | | | | | | (12,546) | | | | | | (4,938) | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 48,990 | | | | | | 82,452 | | | | | | (8,491) | | |
Provision For Income Taxes | | | | | (103,988) | | | | | | (42,296) | | | | | | (10,333) | | |
Net Income (Loss) Before Non-Controlling Interest | | | | | (54,998) | | | | | | 40,156 | | | | | | (18,824) | | |
Net Income (Loss) Attributable to Non-Controlling Interest | | | | | 2,509 | | | | | | 1,755 | | | | | | (551) | | |
Net Income (Loss) Attributable to Verano Holdings Corp. | | | | $ | (57,507) | | | | | $ | 38,401 | | | | | $ | (18,273) | | |
Net Income (Loss) per share – basic | | | | | (0.20) | | | | | | 0.15 | | | | | | (0.07) | | |
Net Income (Loss) per share – diluted | | | | | (0.20) | | | | | | 0.14 | | | | | | (0.07) | | |
Basic – weighted average shares outstanding | | | | | 290,443,432 | | | | | | 263,919,366 | | | | | | 261,432,115 | | |
Diluted – weighted average shares outstanding | | | | | 290,443,432 | | | | | | 270,719,280 | | | | | | 261,432,115 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2019 | | | | | 253,137,378 | | | | | | — | | | | | $ | 112,071 | | | | | $ | — | | | | | $ | 2,801 | | | | | $ | 114,872 | | |
Adoption of ASC 842, Leases | | | | | — | | | | | | — | | | | | | — | | | | | | (252) | | | | | | — | | | | | | (252) | | |
Contributions from Members | | | | | — | | | | | | — | | | | | | 5,906 | | | | | | — | | | | | | 71 | | | | | | 5,977 | | |
Warrants issued for Notes Payable | | | | | 7,421,379 | | | | | | — | | | | | | 5,449 | | | | | | — | | | | | | — | | | | | | 5,449 | | |
Issuance of Warrants | | | | | 986,921 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Issuance of Beneficial Conversion Notes | | | | | — | | | | | | — | | | | | | 3,276 | | | | | | — | | | | | | — | | | | | | 3,276 | | |
Non-controlling interest from acquisition | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,171 | | | | | | 8,171 | | |
Transfer from non-controlling interest to controlling | | | | | — | | | | | | — | | | | | | 688 | | | | | | — | | | | | | (688) | | | | | | — | | |
Distributions to members | | | | | — | | | | | | — | | | | | | — | | | | | | (6,632) | | | | | | (9) | | | | | | (6,641) | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (18,273) | | | | | | (551) | | | | | | (18,824) | | |
Balance as of December 31, 2019 | | | | | 261,545,678 | | | | | | — | | | | | $ | 127,390 | | | | | $ | (25,157) | | | | | $ | 9,795 | | | | | $ | 112,028 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2020 | | | | | 261,545,678 | | | | | | — | | | | | $ | 127,390 | | | | | $ | (25,157) | | | | | $ | 9,795 | | | | | $ | 112,028 | | |
Purchase of Non-controlling interest | | | | | — | | | | | | — | | | | | | — | | | | | | (3,950) | | | | | | (2,950) | | | | | | (6,900) | | |
Deconsolidation of subsidiary | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 79 | | | | | | 79 | | |
Conversion of Warrants | | | | | 18,354,322 | | | | | | — | | | | | | 10,524 | | | | | | — | | | | | | — | | | | | | 10,524 | | |
Derecognition of NCI | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (2,442) | | | | | | (2,442) | | |
Distributions to members | | | | | — | | | | | | — | | | | | | — | | | | | | (47) | | | | | | — | | | | | | (47) | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | 38,401 | | | | | | 1,755 | | | | | | 40,156 | | |
Balance as of December 31, 2020 | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
(As Restated) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,000) | | | | | | 279,900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority holders | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,675) | | | | | | (1,675) | | |
Purchase of Non-controlling interest | | | | | — | | | | | | — | | | | | | 505 | | | | | | (6,975) | | | | | | (5,795) | | | | | | (12,265) | | |
Share-based compensation | | | | | — | | | | | | 987,242 | | | | | | 48,319 | | | | | | — | | | | | | — | | | | | | 48,319 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 29,526,129 | | | | | | 522,120 | | | | | | — | | | | | | — | | | | | | 522,120 | | |
Warrants issued and exercised | | | | | — | | | | | | 3,510,000 | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 289,291 | | | | | | 4,170 | | | | | | — | | | | | | — | | | | | | 4,170 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (57,507) | | | | | | 2,509 | | | | | | (54,998) | | |
Balance as of December 31, 2021 | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Net income (loss) attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (57,507) | | | | | $ | 38,401 | | | | | $ | (18,273) | | |
Net income (loss) attributable to non-controlling interest | | | | | 2,509 | | | | | | 1,755 | | | | | | (551) | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 96,244 | | | | | | 7,866 | | | | | | 7,393 | | |
Non-cash interest expense | | | | | 5,727 | | | | | | 1,074 | | | | | | — | | |
Non-cash interest income | | | | | (166) | | | | | | (935) | | | | | | — | | |
Non-cash inventory step-up expense on acquisitions | | | | | 80,988 | | | | | | — | | | | | | — | | |
Loss on disposal of property, plant and equipment | | | | | 1,085 | | | | | | 1,655 | | | | | | 1,546 | | |
Loss on disposition of VIE | | | | | — | | | | | | 2,202 | | | | | | — | | |
Gain on previously held equity interest | | | | | — | | | | | | (458) | | | | | | — | | |
Bad debt expense | | | | | 1,701 | | | | | | 300 | | | | | | 331 | | |
Amortization of loan issuance costs – warrants | | | | | — | | | | | | 3,018 | | | | | | 424 | | |
Amortization of debt issuance costs | | | | | 2,566 | | | | | | 235 | | | | | | 124 | | |
Amortization of convertible debt discount | | | | | — | | | | | | 2,912 | | | | | | 364 | | |
Write-off of note receivable | | | | | 14 | | | | | | 300 | | | | | | — | | |
Loss on deconsolidation of subsidiary | | | | | — | | | | | | 159 | | | | | | 2,275 | | |
Loss (income) from underlying investees | | | | | (4,544) | | | | | | (2,608) | | | | | | 456 | | |
Contingent consideration compensation | | | | | 4,170 | | | | | | — | | | | | | — | | |
Loss on share issuance | | | | | 1,207 | | | | | | — | | | | | | — | | |
(Decrease) in fair value of contingent consideration | | | | | (13,676) | | | | | | — | | | | | | — | | |
Stock based compensation | | | | | 45,250 | | | | | | — | | | | | | — | | |
Derecognition of deferred rent | | | | | — | | | | | | — | | | | | | 104 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | |
Accounts receivable | | | | | (6,673) | | | | | | (2,506) | | | | | | (2,622) | | |
Inventories | | | | | (59,506) | | | | | | (22,873) | | | | | | (8,368) | | |
Prepaid expenses and other current assets | | | | | (6,252) | | | | | | (3,043) | | | | | | (1,657) | | |
Deposits and other assets | | | | | 8,553 | | | | | | 3,008 | | | | | | (1,795) | | |
Investment in associates | | | | | 1,675 | | | | | | — | | | | | | — | | |
Accounts payable | | | | | 9,920 | | | | | | 1,777 | | | | | | 4,221 | | |
Accrued liabilities | | | | | 1,670 | | | | | | 10,508 | | | | | | 1,263 | | |
Change in Lease Liabilities | | | | | (7,743) | | | | | | (1,717) | | | | | | (1,479) | | |
Income tax payable | | | | | 109,452 | | | | | | 29,952 | | | | | | 10,420 | | |
Due to related parties, net | | | | | (45) | | | | | | (833) | | | | | | (513) | | |
Deferred taxes | | | | | (32,810) | | | | | | (557) | | | | | | (323) | | |
Deferred revenue | | | | | (937) | | | | | | 2,035 | | | | | | — | | |
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | | | | | 182,872 | | | | | | 71,627 | | | | | | (6,660) | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Cash paid in membership interest acquisition | | | | | — | | | | | | — | | | | | | (3,500) | | |
Purchases of property, plant and equipment | | | | | (141,265) | | | | | | (60,153) | | | | | | (59,041) | | |
Proceeds from disposal of assets | | | | | 1,894 | | | | | | — | | | | | | — | | |
Advances to related parties | | | | | 108 | | | | | | 145 | | | | | | — | | |
Purchases of intangible assets | | | | | (8,374) | | | | | | (7,010) | | | | | | (7,237) | | |
Purchase of NCI | | | | | (7,840) | | | | | | — | | | | | | — | | |
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Acquisition of businesses, net of cash acquired | | | | | (309,815) | | | | | | (21,902) | | | | | | 61 | | |
Payment of acquisition price payable | | | | | — | | | | | | (1,544) | | | | | | — | | |
Cash paid in deconsolidation of subsidiary | | | | | — | | | | | | — | | | | | | (59) | | |
Distributions to minority holders | | | | | (1,675) | | | | | | | | | | | | | | |
Purchase of interest in investment in associates | | | | | (3,350) | | | | | | — | | | | | | (9,913) | | |
Dividend received from investments in associates | | | | | 10,275 | | | | | | 1,867 | | | | | | 571 | | |
Issuance of note receivable | | | | | (147) | | | | | | (186) | | | | | | (5,000) | | |
Proceeds from note receivable | | | | | 4,215 | | | | | | 1,875 | | | | | | — | | |
Interest received on note receivable | | | | | 142 | | | | | | — | | | | | | — | | |
NET CASH (USED IN) INVESTING ACTIVITIES | | | | | (455,832) | | | | | | (86,908) | | | | | | (84,118) | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Contributions from members | | | | | — | | | | | | — | | | | | | 5,977 | | |
Distributions to members | | | | | — | | | | | | (46) | | | | | | (6,102) | | |
Proceeds from exercise of warrants | | | | | — | | | | | | 2,191 | | | | | | 2,173 | | |
Proceeds from issuance of notes payable | | | | | 224,725 | | | | | | 33,943 | | | | | | 21,613 | | |
Principal repayments of notes payable | | | | | (10,757) | | | | | | (9,754) | | | | | | (4,353) | | |
Debt issuance costs paid | | | | | (8,812) | | | | | | (1,068) | | | | | | (200) | | |
Proceeds from sale of Property, Plant & Equipment | | | | | — | | | | | | — | | | | | | 5,000 | | |
Proceeds received from RTO financing | | | | | 75,420 | | | | | | — | | | | | | — | | |
Cash received in warrant private placement | | | | | 75,100 | | | | | | — | | | | | | — | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 355,676 | | | | | | 25,266 | | | | | | 24,108 | | |
NET INCREASE (DECREASE) IN CASH | | | | | 82,716 | | | | | | 9,985 | | | | | | (66,670) | | |
CASH, BEGINNING OF PERIOD | | | | | 16,402 | | | | | | 6,417 | | | | | | 73,087 | | |
CASH, END OF PERIOD | | | | $ | 99,118 | | | | | $ | 16,402 | | | | | $ | 6,417 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | | | | | | | |
Interest (received) paid | | | | $ | 18,709 | | | | | $ | 1,761 | | | | | $ | (218) | | |
Cash paid for taxes | | | | $ | 27,962 | | | | | $ | 10,237 | | | | | $ | 569 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 8,512 | | | | | $ | 1,860 | | | | | $ | 6,633 | | |
Issuance of note receivable related to sale of property, plant, and equipment | | | | $ | — | | | | | $ | — | | | | | $ | 5,000 | | |
Distributions receivable from investment in associate | | | | $ | — | | | | | $ | — | | | | | $ | 83 | | |
Issuance of shares under business combinations | | | | $ | 1,148,127 | | | | | $ | — | | | | | $ | — | | |
Acquisitions | | | | | | | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 1,638,726 | | | | | $ | 50,925 | | | | | $ | 4,394 | | |
Liabilities assumed | | | | | (354,933) | | | | | | (17,872) | | | | | | (1,055) | | |
Acquisition consideration payable | | | | | (1,324,914) | | | | | | (21,186) | | | | | | (1,000) | | |
Issuance of note payable | | | | | — | | | | | | (350) | | | | | | — | | |
Goodwill | | | | | 350,936 | | | | | | 10,965 | | | | | | — | | |
Noncontrolling interest from acquisitions | | | | | — | | | | | | — | | | | | | (2,400) | | |
Previously held equity interest | | | | | — | | | | | | (580) | | | | | | — | | |
| | | | $ | 309,815 | | | | | $ | 21,902 | | | | | $ | (61) | | |
Entity Name | | | Jurisdiction | | | Purpose | | | Percentage Interest | |
12395 North Miami, LLC | | | Florida | | | Real Estate holding company | | | 100% | |
130 Monroeville, LLC | | | Pennsylvania | | | Real Estate holding company | | | 100% | |
16 Magothy Road Beach, LLC | | | Maryland | | | Real Estate holding company | | | 100% | |
1728 & 52 Old York Road, LLC | | | Pennsylvania | | | Real Estate holding company | | | 100% | |
2000-2015 W. 3rd Street, LLC | | | Arizona | | | Real Estate holding company | | | 100% | |
257 Wynnewood, LLC | | | Pennsylvania | | | Real Estate holding company | | | 100% | |
270 Cranberry, LLC | | | Pennsylvania | | | Real Estate holding company | | | 100% | |
3510 Ocala, LLC | | | Florida | | | Real Estate holding company | | | 100% | |
4450 New Haven, LLC | | | Florida | | | Real Estate holding company | | | 100% | |
4674 JAX, LLC | | | Florida | | | Real Estate holding company | | | 100% | |
5409 S. Power Road, LLC | | | Arizona | | | Real Estate holding company | | | 100% | |
7221 Jessup, LLC | | | Maryland | | | Real Estate holding company | | | 100% | |
783 Butterfield Road, LLC | | | Illinois | | | Real Estate holding company | | | 100% | |
799 Washington, LLC | | | Pennsylvania | | | Real Estate holding company | | | 100% | |
A&T SPV II LLC | | | Texas | | | Holding company | | | 100% | |
AGG Wellness, LLC | | | Maryland | | | Dispensary | | | 100% | |
AGOZ Redevelopment, LP | | | Pennsylvania | | | Real Estate holding company | | | 100% | |
Agri-Kind, LLC | | | Pennsylvania | | | Cultivation | | | 100% | |
Agronomed Biologics Holdings Inc. | | | Pennsylvania | | | Holding company | | | 100% | |
Agronomed Biologics LLC | | | Pennsylvania | | | Cultivation/Dispensary | | | 100% | |
Agronomed Holdings, Inc. | | | Pennsylvania | | | Holding company | | | 100% | |
Agronomed IP LLC | | | Pennsylvania | | | Intellectual property | | | 15% | |
Agronomy Holdings, LLC | | | Florida | | | Holding company | | | 100% | |
Agronomy Innovations LLC | | | Arizona | | | Management company | | | 100% | |
Albion MM, LLC | | | Illinois | | | Real Estate holding company | | | 100% | |
Alternative Medical Enterprises LLC | | | Delaware | | | Holding company | | | 100% | |
AltMed, LLC | | | Florida | | | Holding company | | | 100% | |
Ataraxia, LLC | | | Illinois | | | Cultivation | | | 100% | |
AZ MM Logistics, LLC | | | Arizona | | | Logistics company | | | 100% | |
BISHCO LLC | | | Arizona | | | Management company | | | 100% | |
Branchburg Rte. 22, LLC | | | New Jersey | | | Real Estate holding company | | | 100% | |
Caring Nature, LLC | | | Connecticut | | | Dispensary | | | 100% | |
Cave Creek RE, LLC | | | Arizona | | | Real Estate holding company | | | 100% | |
Chicago Natural Treatment Solutions, LLC | | | Delaware | | | Holding company | | | 100% | |
Connecticut Pharmaceutical Solutions, Inc. | | | Delaware | | | Holding company | | | 100% | |
Connecticut Pharmaceutical | | | | | | | |
Entity Name | | | Jurisdiction | | | Purpose | | | Percentage Interest | |
Solutions, LLC | | | Connecticut | | | Cultivation | | | 100% | |
CTPharma Real Estate Inc. | | | Connecticut | | | Real Estate holding company | | | 100% | |
CTPharma Research Solutions, LLC | | | Delaware | | | Research business | | | 10% | |
Cultivation Corner, LLC | | | Arizona | | | Management company | | | 100% | |
DGV Group, LLC | | | Delaware | | | California joint venture | | | 62.50% | |
Eastern and Pebble, LLC | | | Florida | | | Real Estate holding company | | | 100% | |
FAD Investment Group, LLC | | | Illinois | | | Holding company | | | 100% | |
FGM Processing, LLC | | | Maryland | | | Processor | | | 100% | |
Four Daughters Compassionate Care, Inc. | | | Massachusetts | | | Cultivation/Dispensary | | | 100% | |
Freestate Wellness, LLC | | | Maryland | | | Cultivation/Dispensary | | | 100% | |
Glass City Alternatives, LLC | | | Ohio | | | Dispensary | | | 100% | |
GLD Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
Green RX, LLC | | | Ohio | | | Dispensary | | | 100% | |
GVB Holding Group LLC | | | Pennsylvania | | | Holding company | | | 100% | |
Healthway Services of Illinois, LLC | | | Illinois | | | Holding company | | | 100% | |
ILDISP, LLC(1) | | | Illinois | | | Holding company | | | 50% | |
ILMM Logistics, LLC | | | Illinois | | | Logistics company | | | 100% | |
Local Dispensaries, LLC | | | Pennsylvania | | | Dispensary | | | 100% | |
MA MM Logistics, LLC | | | Illinois | | | Logistics company | | | 100% | |
Mad River Remedies, LLC | | | Ohio | | | Dispensary | | | 100% | |
Maryland Natural Treatment Solutions, LLC | | | Maryland | | | Dispensary | | | 100% | |
MD MM Logistics, LLC | | | Maryland | | | Logistics company | | | 100% | |
MDCult, LLC | | | Maryland | | | Holding company | | | 100% | |
Mother Grows Best, LLC | | | Ohio | | | Cultivation | | | 100% | |
Mother Know’s Best, LLC | | | Ohio | | | Dispensary | | | 100% | |
MUVHealth LLC | | | Arizona | | | Holding company | | | 100% | |
NH Medicinal Dispensaries, LLC1 | | | Illinois | | | Dispensary | | | 50% | |
NJ MM Logistics, LLC | | | New Jersey | | | Logistics company | | | 100% | |
NNTS Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
NSE Pennsylvania LLC | | | Pennsylvania | | | Dispensary | | | 100% | |
NuTrae, LLC | | | Florida | | | Intellectual property | | | 100% | |
Nuuvn Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
NV MM Logistics, LLC | | | Nevada | | | Logistics company | | | 100% | |
OH MM Logistics, LLC | | | Ohio | | | Logistics company | | | 100% | |
Entity Name | | | Jurisdiction | | | Purpose | | | Percentage Interest | |
Ohio Natural Treatment Solutions, LLC | | | Delaware | | | Management company | | | 100% | |
PA MM Logistics, LLC | | | Pennsylvania | | | Logistics company | | | 100% | |
Plants of Ruskin GPS, LLC | | | Delaware | | | Holding company | | | 100% | |
Plants of Ruskin, LLC | | | Florida | | | Cultivation/Dispensary | | | 100% | |
Prospect Heights RE, LLC | | | Illinois | | | Real Estate holding company | | | 100% | |
Redfish Holdings, Inc. | | | Maryland | | | Holding company | | | 100% | |
RedMed Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
RedMed, LLC | | | Delaware | | | Holding company | | | 100% | |
RVC 360, LLC | | | Delaware | | | Real Estate holding company | | | 100% | |
Saint Chicago Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
SG1 LLC | | | Delaware | | | Holding company | | | 100% | |
SW Merger Sub, Inc. | | | Nevada | | | Acquisition subsidiary | | | 100% | |
TAB Management Group, LLC | | | Illinois | | | Holding company | | | 100% | |
TAMM, LLC | | | Illinois | | | Holding company | | | 100% | |
TerraVida Holistic Centers LLC | | | Pennsylvania | | | Dispensary | | | 100% | |
The Healing Center LLC | | | Pennsylvania | | | Dispensary | | | 100% | |
TOKI Veterans Group, LLC | | | Illinois | | | Holding company | | | 100% | |
Verano Arizona Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano Arizona II, LLC | | | Delaware | | | Management company | | | 100% | |
Verano Arizona, LLC | | | Delaware | | | Management company | | | 100% | |
Verano Arlington, LLC | | | Delaware | | | Real Estate holding company | | | 100% | |
Verano Connecticut, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano El Dorado, LLC | | | Arkansas | | | Real Estate holding company | | | 100% | |
Verano Evanston, LLC | | | Illinois | | | Holding company | | | 100% | |
Verano Four Daughters Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano Highland Park, LLC | | | Illinois | | | Holding company | | | 100% | |
Verano Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano Holdings USA Corp. | | | Delaware | | | Holding company | | | 100% | |
Verano Illinois, LLC | | | Illinois | | | Holding company | | | 100% | |
Verano IP, LLC | | | Delaware | | | Intellectual property | | | 100% | |
Verano Michigan, LLC | | | Delaware | | | Management company | | | 100% | |
Verano NJ Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano NSE Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano Oklahoma, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano Technologies, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano THC Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
VH MRR, LLC | | | Ohio | | | Holding company | | | 100% | |
VHGCA Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
VHGG Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
VHGG Real Estate Holdings, LLC | | | Delaware | | | Real Estate holding company | | | 100% | |
VHGRX Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
VHMD Processor, LLC | | | Delaware | | | Processor | | | 100% | |
Entity Name | | | Jurisdiction | | | Purpose | | | Percentage Interest | |
VZL Staffing Services, LLC | | | Illinois | | | Staffing company | | | 100% | |
Willow Brook Wellness, LLC | | | Connecticut | | | Dispensary | | | 100% | |
Zen Leaf Retail, LLC | | | Maryland | | | Holding company | | | 100% | |
Zen Leaf Technologies, LLC | | | Delaware | | | Management company | | | 100% | |
ZenNorth, LLC | | | Delaware | | | Holding company | | | 100% | |
ZNN Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
Entity Name | | | Jurisdiction of Organization | | | Purpose | | | Percentage Interest | |
2900 Lone Mountain, LLC | | | Nevada | | | Real Estate holding company | | | 100% | |
4444 W. Craig Road, LLC | | | Nevada | | | Real Estate holding company | | | 100% | |
AZGM 3, Inc. | | | Arizona | | | Cultivation/Dispensary | | | 100% | |
Buchanan Development, LLC | | | Michigan | | | Dispensary | | | 100% | |
Canna Cuzzos, LLC | | | Maryland | | | Dispensary | | | 40% | |
ChiVegs Real Estate, LLC | | | Nevada | | | Real Estate holding company | | | 100% | |
EIJNO, LP | | | Illinois | | | Holding company | | | 100% | |
Elevele LLC | | | Illinois | | | Dispensary | | | 100% | |
Fort Consulting, LLC | | | Arizona | | | Cultivation/Dispensary | | | 100% | |
Healthway Services of West Illinois, LLC | | | Illinois | | | Dispensary | | | 100% | |
Lone Mountain Partners, LLC | | | Nevada | | | Cultivation | | | 100% | |
Mikran, LLC | | | Maryland | | | Dispensary | | | 100% | |
MME Aurora Retail, LLC | | | Illinois | | | Dispensary | | | 100% | |
MME Evanston Retail, LLC | | | Illinois | | | Dispensary | | | 100% | |
MME IL Holdings, LLC | | | Illinois | | | Holding company | | | 100% | |
Natural Treatment Solutions, LLC | | | Nevada | | | Holding company | | | 100% | |
NatureX, LLC | | | Nevada | | | Dispensary | | | 100% | |
Nevada Natural Treatment Solutions, LLC | | | Nevada | | | Holding company | | | 100% | |
Noah’s Ark, LLC | | | Arkansas | | | Dispensary | | | 100% | |
Patient Alternative Relief Center | | | Arizona | | | Cultivation/Dispensary | | | 100% | |
Perpetual Healthcare, Inc. | | | Arizona | | | Cultivation/Dispensary | | | 100% | |
Saint Chicago, LLC | | | Illinois | | | Holding company | | | 100% | |
SPSLE Corp. | | | Illinois | | | Holding company | | | 100% | |
The Herbal Care Center, Inc. | | | Illinois | | | Dispensary | | | 100% | |
The M Group, LLC | | | Maryland | | | Holding company | | | 40% | |
The Medicine Room, LLC | | | Arizona | | | Dispensary | | | 100% | |
V Waldorf, LLC | | | Maryland | | | Holding company | | | 100% | |
Entity Name | | | Jurisdiction of Organization | | | Purpose | | | Percentage Interest | |
Vending Logistics LLC | | | Arizona | | | Dispensary | | | 100% | |
Verano MI2, LLC | | | Michigan | | | Holding company | | | 100% | |
Verano MO Holdings, LLC | | | Delaware | | | Holding company | | | 100% | |
Verano MO, LLC | | | Missouri | | | Holding company | | | 100% | |
Verano NJ LLC | | | New Jersey | | | Cultivation/Dispensary | | | 100% | |
Verano WV, LLC | | | West Virginia | | | Dispensary | | | 100% | |
VMO Processing, LLC | | | Missouri | | | Processor | | | 100% | |
VMO Retail, LLC | | | Missouri | | | Dispensary | | | 100% | |
West Capital, LLC | | | Illinois | | | Real Estate holding company | | | 100% | |
| Land | | | Not Applicable | |
| Building | | | 30 years | |
| Construction in Progress (“CIP”) | | | Not Applicable | |
| Leasehold Improvements | | | Shorter of: remaining lease term or 10 years | |
| Tools & Equipment | | | 7 years | |
| Kitchen & Lab Equipment | | | 7 years | |
| Other Machinery & Equipment | | | 7 years | |
| Furniture & Fixtures | | | 7 years | |
| Electronic & Security Equipment | | | 5 years | |
| Vehicles | | | 7 years | |
| Land Improvements | | | 15 years | |
| Licenses | | | 9 – 15 years | |
| Tradenames | | | 5 – 10 years | |
| Technology | | | 5 – 20 years | |
| | | December 31, 2021 | | ||||||||||||||||||
| | | As Reported | | | Adjustments | | | | | | As Restated | | |||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 99,118 | | | | | | — | | | | | | | | $ | 99,118 | | |
Accounts Receivable, net | | | | | 17,410 | | | | | | — | | | | | | | | | 17,410 | | |
Notes Receivable | | | | | 285 | | | | | | — | | | | | | | | | 285 | | |
Due from Related Parties | | | | | — | | | | | | — | | | | | | | | | — | | |
Inventory | | | | | 137,634 | | | | | | 3,069 | | | | (a) | | | | | 140,703 | | |
Prepaid Expenses and Other Current Assets | | | | | 19,528 | | | | | | — | | | | | | | | | 19,528 | | |
Total Current Assets | | | | | 273,975 | | | | | | 3,069 | | | | (a) | | | | | 277,044 | | |
Property, Plant and Equipment, net | | | | | 452,232 | | | | | | — | | | | | | | | | 452,232 | | |
Right Of Use Assets, net | | | | | 61,346 | | | | | | — | | | | | | | | | 61,346 | | |
Intangible Assets, net | | | | | 1,379,913 | | | | | | — | | | | | | | | | 1,379,913 | | |
Goodwill | | | | | 368,130 | | | | | | — | | | | | | | | | 368,130 | | |
Investment in Associates | | | | | 7,628 | | | | | | (137) | | | | (b) | | | | | 7,491 | | |
Deposits and Other Assets | | | | | 2,499 | | | | | | — | | | | | | | | | 2,499 | | |
TOTAL ASSETS | | | | $ | 2,545,723 | | | | | | 2,932 | | | | (a), (b) | | | | $ | 2,548,655 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 45,172 | | | | | | — | | | | | | | | $ | 45,172 | | |
Accrued Liabilities | | | | | 42,150 | | | | | | — | | | | | | | | | 42,149 | | |
Income Tax Payable | | | | | 153,850 | | | | | | 661 | | | | (a) | | | | | 154,512 | | |
Current Portion of Lease Liabilities | | | | | 6,563 | | | | | | — | | | | | | | | | 6,563 | | |
Current Portion of Notes Payable | | | | | 13,771 | | | | | | — | | | | | | | | | 13,771 | | |
Acquisition Consideration Payable | | | | | 208,349 | | | | | | — | | | | | | | | | 208,349 | | |
Due to Related Parties | | | | | — | | | | | | — | | | | | | | | | | | |
Total Current Liabilities | | | | | 469,855 | | | | | | 661 | | | | (a) | | | | | 470,516 | | |
Long-Term Liabilities: | | | | | | | | | | | | | | | | | | | | | | |
Deferred Revenue | | | | | 1,183 | | | | | | — | | | | | | | | | 1,183 | | |
Notes Payable, net of Current Portion | | | | | 276,154 | | | | | | — | | | | | | | | | 276,154 | | |
Lease Liabilities, net of Current Portion | | | | | 56,812 | | | | | | — | | | | | | | | | 56,812 | | |
Deferred Income Taxes | | | | | 262,984 | | | | | | (800) | | | | (a) | | | | | 262,184 | | |
Total Long-Term Liabilities | | | | | 597,133 | | | | | | (800) | | | | (a) | | | | | 596,333 | | |
TOTAL LIABILITIES | | | | $ | 1,066,988 | | | | | | (139) | | | | (a) | | | | $ | 1,066,849 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,475,784 | | | | | | 4,746 | | | | (a) | | | | | 1,480,530 | | |
NON-CONTROLLING INTEREST | | | | | 2,951 | | | | | | (1,675) | | | | (b) | | | | | 1,276 | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,545,723 | | | | | | 2,932 | | | | (a), (b) | | | | $ | 2,548,655 | | |
Revenues, net of discounts | | | | $ | 737,850 | | | | | | — | | | | | | | | $ | 737,850 | | |
Cost of Goods Sold, net | | | | | 403,287 | | | | | | 3,544 | | | | (a) | | | | | 406,831 | | |
Gross Profit | | | | | 334,563 | | | | | | (3,544) | | | | (a) | | | | | 331,019 | | |
| | | December 31, 2021 | | ||||||||||||||||||
| | | As Reported | | | Adjustments | | | | | | As Restated | | |||||||||
Operating Expenses: | | | | | | | | | | | | | | | | | | | | | | |
General and Administrative | | | | | 100,903 | | | | | | — | | | | | | | | | 100,903 | | |
Sales and Marketing | | | | | 8,644 | | | | | | — | | | | | | | | | 8,644 | | |
Salaries and Benefits | | | | | 78,634 | | | | | | 40,964 | | | | (a) | | | | | 119,598 | | |
Depreciation and Amortization | | | | | 41,784 | | | | | | — | | | | | | | | | 41,784 | | |
Total Operating Expenses | | | | | 229,965 | | | | | | 40,964 | | | | (a) | | | | | 270,929 | | |
Income (Loss) from Investments in Associates | | | | | 3,085 | | | | | | 1,537 | | | | (b) | | | | | 4,623 | | |
Income (Loss) From Operations | | | | | 107,683 | | | | | | (42,970) | | | | (a) (b) | | | | | 64,713 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | | | | |
(Loss) on Disposal of Property, Plant and Equipment | | | | | (1,085) | | | | | | — | | | | | | | | | (1,085) | | |
(Loss) on Deconsolidation | | | | | — | | | | | | — | | | | | | | | | — | | |
Gain on Previously Held Equity Interest | | | | | — | | | | | | — | | | | | | | | | — | | |
Amortization of Debt Issuance Costs for Warrant | | | | | — | | | | | | — | | | | | | | | | — | | |
Amortization of Convertible Debt Discount | | | | | — | | | | | | — | | | | | | | | | — | | |
Other Income (Expense), net | | | | | 9,632 | | | | | | — | | | | | | | | | 9,632 | | |
Interest Income (Expense), net | | | | | (24,270) | | | | | | — | | | | | | | | | (24,270) | | |
Total Other Expense | | | | | (15,723) | | | | | | — | | | | | | | | | (15,723) | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 91,960 | | | | | | (42,970) | | | | (a) (b) | | | | | 48,990 | | |
Provision For Income Taxes | | | | | (104,127) | | | | | | 139 | | | | (a) | | | | | (103,988) | | |
Net Income (Loss) Before Non-Controlling Interest | | | | | (12,167) | | | | | | (42,831) | | | | (a) (b) | | | | | (54,998) | | |
Net Income (Loss) Attributable to Non-Controlling Interest | | | | | 2,509 | | | | | | — | | | | | | | | | 2,509 | | |
Net Income (Loss) Attributable to Verano Holdings Corp. | | | | $ | (14,676) | | | | | | (42,831) | | | | (a) (b) | | | | $ | (57,507) | | |
Net Income (Loss) per share – basic | | | | | (0.05) | | | | | | (0.15) | | | | (a) | | | | | (0.20) | | |
Net Income (Loss) per share – diluted | | | | | (0.05) | | | | | | (0.15) | | | | (a) | | | | | (0.20) | | |
Basic – weighted average shares outstanding | | | | | 290,443,432 | | | | | | — | | | | | | | | | 290,443,432 | | |
Diluted – weighted average shares outstanding | | | | | 290,443,432 | | | | | | — | | | | | | | | | 290,443,432 | | |
| | | | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
As Previously Reported | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 | | | | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | | | | (279,900,000) | | | | | | 279,900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Purchase of Non-controlling interest | | | | | | | | — | | | | | | — | | | | | | 505 | | | | | | (6,975) | | | | | | (5,795) | | | | | | (12,265) | | |
Share-based compensation | | | | | | | | — | | | | | | 987,242 | | | | | | 742 | | | | | | — | | | | | | — | | | | | | 742 | | |
Issuance of shares in conjunction with acquisitions | | | | | | | | — | | | | | | 29,526,129 | | | | | | 522,120 | | | | | | — | | | | | | — | | | | | | 522,120 | | |
Warrants issued and exercised | | | | | | | | — | | | | | | 3,510,000 | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Contingent consideration & other adjustments to purchase accounting | | | | | | | | — | | | | | | 289,291 | | | | | | 4,170 | | | | | | — | | | | | | — | | | | | | 4,170 | | |
Net Income (Loss) | | | | | | | | — | | | | | | — | | | | | | — | | | | | | (14,676) | | | | | | 2,509 | | | | | | (12,167) | | |
Balance as of December 31, 2021 | | | | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,488,188 | | | | | $ | (12,404) | | | | | $ | 2,951 | | | | | $ | 1,478,735 | | |
Adjustments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net effect to Share-based compensation | | | (a) | | | | | — | | | | | | — | | | | | | 47,577 | | | | | | — | | | | | | — | | | | | | 47,577 | | |
Distributions to Non-Controlling Interests | | | (b) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (1,675) | | | | | | (1,675) | | |
Net effect to Net Income (Loss) | | | (a) (b) | | | | | — | | | | | | — | | | | | | | | | | | | — | | | | | | (42,831) | | | | | | (42,831) | | |
Total Adjustments | | | | | | | | — | | | | | | — | | | | | | 47,577 | | | | | | (42,831) | | | | | | (1,675) | | | | | | 3,071 | | |
As Restated | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 | | | | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | | | | (279,900,000) | | | | | | 279,900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority holders | | | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,675) | | | | | | (1,675) | | |
Purchase of Non-controlling interest | | | | | | | | — | | | | | | — | | | | | | 505 | | | | | | (6,975) | | | | | | (5,795) | | | | | | (12,265) | | |
Share-based compensation | | | | | | | | — | | | | | | 987,242 | | | | | | 48,319 | | | | | | — | | | | | | — | | | | | | 48,319 | | |
Issuance of shares in conjunction with acquisitions | | | | | | | | — | | | | | | 29,526,129 | | | | | | 522,120 | | | | | | — | | | | | | — | | | | | | 522,120 | | |
Warrants issued and exercised | | | | | | | | — | | | | | | 3,510,000 | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Contingent consideration & other adjustments to purchase accounting | | | | | | | | — | | | | | | 289,291 | | | | | | 4,170 | | | | | | — | | | | | | — | | | | | | 4,170 | | |
Net Income (Loss) | | | | | | | | — | | | | | | — | | | | | | — | | | | | | (57,507) | | | | | | 2,509 | | | | | | (54,998) | | |
Balance as of December 31, 2021 – As Restated | | | | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
| | | December 31, 2021 | | ||||||||||||||||||
| | | As Reported | | | Adjustments | | | | | | As Restated | | |||||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | | | | | | | | | | |
Net Loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (14,676) | | | | | | (42,831) | | | | (a) (b) | | | | $ | (57,507) | | |
Net Income attributable to non-controlling interest | | | | | 2,509 | | | | | | — | | | | | | | | | 2,509 | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 96,244 | | | | | | — | | | | | | | | | 96,244 | | |
Non-cash interest expense | | | | | 5,727 | | | | | | — | | | | | | | | | 5,727 | | |
Non-cash interest income | | | | | (166) | | | | | | — | | | | | | | | | (166) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 80,988 | | | | | | — | | | | — | | | | | 80,988 | | |
Loss on disposal of property, plant and equipment | | | | | 1,085 | | | | | | — | | | | — | | | | | 1,085 | | |
Loss on disposition of VIE | | | | | — | | | | | | — | | | | | | | | | — | | |
Gain on previously held equity interest | | | | | — | | | | | | — | | | | | | | | | — | | |
Bad debt expense | | | | | 1,701 | | | | | | — | | | | | | | | | 1,701 | | |
Amortization of loan issuance costs – warrants | | | | | — | | | | | | — | | | | | | | | | — | | |
Amortization of debt issuance costs | | | | | 2,566 | | | | | | — | | | | | | | | | 2,566 | | |
Amortization of convertible debt discount | | | | | — | | | | | | — | | | | | | | | | — | | |
Write-off of note receivable | | | | | 14 | | | | | | — | | | | | | | | | 14 | | |
Loss on deconsolidation of subsidiary | | | | | — | | | | | | — | | | | | | | | | — | | |
Loss (income) from underlying investees | | | | | (3,006) | | | | | | (1,537) | | | | (b) | | | | | (4,544) | | |
Contingent consideration compensation | | | | | 4,170 | | | | | | — | | | | | | | | | 4,170 | | |
Loss on share issuance | | | | | 1,207 | | | | | | — | | | | | | | | | 1,207 | | |
(Decrease) in fair value of contingent consideration | | | | | (13,676) | | | | | | — | | | | | | | | | (13,676) | | |
Stock based compensation | | | | | 742 | | | | | | 44,508 | | | | (a) | | | | | 45,250 | | |
Derecognition of deferred rent | | | | | — | | | | | | — | | | | | | | | | — | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | | | | | | | | | | |
Accounts receivable | | | | | (6,673) | | | | | | — | | | | | | | | | (6,673) | | |
Inventories | | | | | (59,506) | | | | | | — | | | | | | | | | (59,506) | | |
Prepaid expenses and other current assets | | | | | (6,252) | | | | | | — | | | | | | | | | (6,252) | | |
Deposits and other assets | | | | | 8,553 | | | | | | — | | | | | | | | | 8,553 | | |
Investment in associates | | | | | — | | | | | | 1,675 | | | | (b) | | | | | 1,675 | | |
Accounts payable | | | | | 9,920 | | | | | | — | | | | | | | | | 9,920 | | |
Accrued liabilities | | | | | 1,670 | | | | | | — | | | | | | | | | 1,670 | | |
Change in Lease Liabilities | | | | | (7,743) | | | | | | — | | | | | | | | | (7,743) | | |
Income tax payable | | | | | 108,790 | | | | | | 662 | | | | (a) | | | | | 109,452 | | |
Due to related parties, net | | | | | (45) | | | | | | — | | | | | | | | | (45) | | |
Deferred taxes | | | | | (32,009) | | | | | | (801) | | | | (a) | | | | | (32,810) | | |
Deferred revenue | | | | | (937) | | | | | | — | | | | | | | | (937) | | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 181,197 | | | | | | 1,675 | | | | (a) (b) | | | | | 182,872 | | |
| | | December 31, 2021 | | ||||||||||||||||||
| | | As Reported | | | Adjustments | | | | | | As Restated | | |||||||||
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | | | | | | | | | | |
Cash paid in membership interest acquisition | | | | | — | | | | | | — | | | | | | | | | — | | |
Purchases of property, plant and equipment | | | | | (141,265) | | | | | | — | | | | | | | | | (141,265) | | |
Proceeds from disposal of assets | | | | | 1,894 | | | | | | — | | | | | | | | | 1,894 | | |
Advances to related parties | | | | | 108 | | | | | | — | | | | | | | | | 108 | | |
Purchases of intangible assets | | | | | (8,374) | | | | | | — | | | | | | | | | (8,374) | | |
Purchase of NCI | | | | | (7,840) | | | | | | — | | | | | | | | | (7,840) | | |
Acquisition of businesses, net of cash acquired | | | | | (309,815) | | | | | | — | | | | | | | | | (309,815) | | |
Payment of acquisition price payable | | | | | — | | | | | | — | | | | | | | | | — | | |
Cash paid in deconsolidation of subsidiary | | | | | — | | | | | | — | | | | | | | | | — | | |
Distributions to minority holders | | | | | — | | | | | | (1,675) | | | | (b) | | | | | (1,675) | | |
Purchase of interest in investment in associates | | | | | (3,350) | | | | | | — | | | | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | 10,275 | | | | | | — | | | | | | | | | 10,275 | | |
Issuance of note receivable | | | | | (147) | | | | | | — | | | | | | | | | (147) | | |
Proceeds from note receivable | | | | | 4,215 | | | | | | — | | | | | | | | | 4,215 | | |
Interest received on note receivable | | | | | 142 | | | | | | — | | | | — | | | | | 142 | | |
NET CASH (USED IN) INVESTING ACTIVITIES | | | | | (454,157) | | | | | | (1,675) | | | | (b) | | | | | (455,832) | | |
|
| | | December 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Contributions from members | | | | | — | | | | | | — | | | | | | — | | |
Distributions to members | | | | | — | | | | | | — | | | | | | — | | |
Proceeds from exercise of warrants | | | | | — | | | | | | — | | | | | | — | | |
Proceeds from issuance of notes payable | | | | | 224,725 | | | | | | — | | | | | | 224,725 | | |
Principal repayments of notes payable | | | | | (10,757) | | | | | | — | | | | | | (10,757) | | |
Debt issuance costs paid | | | | | (8,812) | | | | | | — | | | | | | (8,812) | | |
Proceeds from sale of Property, Plant & Equipment | | | | | — | | | | | | — | | | | | | — | | |
Proceeds received from RTO financing | | | | | 75,420 | | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | 75,100 | | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 355,676 | | | | | | — | | | | | | 355,676 | | |
NET INCREASE (DECREASE) IN CASH | | | | | 82,716 | | | | | | — | | | | | | 82,716 | | |
CASH, BEGINNING OF PERIOD | | | | | 16,402 | | | | | | — | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 99,118 | | | | | | — | | | | | $ | 99,118 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | | | | | | | |
Interest (received) paid | | | | $ | 18,709 | | | | | | — | | | | | $ | 18,709 | | |
Cash paid for taxes | | | | $ | 27,962 | | | | | | — | | | | | $ | 27,962 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 8,512 | | | | | | — | | | | | $ | 8,512 | | |
Issuance of note receivable related to sale of property, plant, and equipment | | | | $ | — | | | | | | — | | | | | $ | — | | |
Distributions receivable from investment in associate | | | | $ | — | | | | | | — | | | | | $ | — | | |
Issuance of shares under business combinations | | | | $ | 1,148,127 | | | | | | — | | | | | $ | 1,148,127 | | |
Acquisitions | | | | | | | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 1,638,726 | | | | | | — | | | | | $ | 1,638,726 | | |
Liabilities assumed | | | | | (354,933) | | | | | | — | | | | | | (354,933) | | |
Acquisition consideration payable | | | | | (1,324,914) | | | | | | — | | | | | | (1,324,914) | | |
Issuance of note payable | | | | | — | | | | | | — | | | | | | — | | |
Goodwill | | | | | 350,936 | | | | | | — | | | | | | 350,936 | | |
Noncontrolling interest from acquisitions | | | | | — | | | | | | — | | | | | | — | | |
Previously held equity interest | | | | | — | | | | | | — | | | | | | — | | |
| | | | $ | 309,815 | | | | | | — | | | | | $ | 309,815 | | |
| | | December 31, 2021 | | | December 31, 2020 | | ||||||
| | | (As Restated) | | | | | | | | |||
Raw Materials | | | | $ | 5,767 | | | | | $ | — | | |
Work in Process | | | | | 96,367 | | | | | | 26,835 | | |
Finished Goods | | | | | 38,569 | | | | | | 10,519 | | |
Total Inventories | | | | $ | 140,703 | | | | | $ | 37,354 | | |
| | | December 31, 2021 | | | December 31, 2020 | | ||||||
Land | | | | $ | 29,399 | | | | | $ | 12,138 | | |
Buildings and Improvements | | | | | 126,020 | | | | | | 15,223 | | |
Furniture and Fixtures | | | | | 13,259 | | | | | | 5,466 | | |
Computer Equipment and Software | | | | | 14,078 | | | | | | 3,331 | | |
Leasehold Improvements | | | | | 182,514 | | | | | | 89,394 | | |
Tools and Equipment | | | | | 65,774 | | | | | | 27,237 | | |
Vehicles | | | | | 3,229 | | | | | | 850 | | |
Assets Under Construction(1) | | | | | 64,107 | | | | | | 8,514 | | |
Total Property, Plant and Equipment, Gross | | | | | 498,380 | | | | | | 162,153 | | |
Less: Accumulated Depreciation | | | | | (46,148) | | | | | | (17,971) | | |
Property, Plant and Equipment, Net | | | | $ | 452,232 | | | | | $ | 144,182 | | |
| | | Property, Plant and Equipment, Gross | | | Accumulated Depreciation | | | Property, Plant and Equipment, Net | | |||||||||
Balance as of January 1, 2020 | | | | $ | 104,470 | | | | | $ | (8,917) | | | | | $ | 95,553 | | |
Additions | | | | | 57,002 | | | | | | — | | | | | | 57,002 | | |
Property, plant and equipment from business combination | | | | | 2,511 | | | | | | — | | | | | | 2,511 | | |
Disposals | | | | | (11) | | | | | | — | | | | | | (11) | | |
Deconsolidation | | | | | (1,819) | | | | | | — | | | | | | (1,819) | | |
Depreciation | | | | | — | | | | | | (9,054) | | | | | | (9,054) | | |
Balance as of December 31, 2020 | | | | $ | 162,153 | | | | | $ | (17,971) | | | | | $ | 144,182 | | |
| | | Property, Plant and Equipment, Gross | | | Accumulated Depreciation | | | Property, Plant and Equipment, Net | | |||||||||
Additions | | | | | 164,940 | | | | | | — | | | | | | 164,940 | | |
Property, plant and equipment from business combination | | | | | 175,172 | | | | | | — | | | | | | 175,172 | | |
Disposals | | | | | (3,885) | | | | | | 15 | | | | | | (3,870) | | |
Depreciation | | | | | — | | | | | | (28,192) | | | | | | (28,192) | | |
Balance as December 31, 2021 | | | | $ | 498,380 | | | | | $ | (46,148) | | | | | $ | 452,232 | | |
|
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 | | | | $ | 76,375 | | | | | $ | 78 | | | | | $ | — | | | | | $ | 76,453 | | |
Purchases | | | | | 55,776 | | | | | | — | | | | | | 115 | | | | | | 55,891 | | |
Additions from business combination | | | | | 1,254,781 | | | | | | 54,088 | | | | | | 11,488 | | | | | | 1,320,357 | | |
Adjustments to purchase price allocation | | | | | (801) | | | | | | — | | | | | | — | | | | | | (801) | | |
Disposals | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Balance as of December 31, 2021 | | | | $ | 1,386,131 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,451,900 | | |
Accumulated Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 | | | | | 4,034 | | | | | | — | | | | | | — | | | | | | 4,034 | | |
Amortization | | | | | 62,669 | | | | | | 4,158 | | | | | | 1,126 | | | | | | 67,953 | | |
Balance as of December 31, 2021 | | | | $ | 66,703 | | | | | $ | 4,158 | | | | | $ | 1,126 | | | | | $ | 71,987 | | |
Net Book Value | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 | | | | | 72,341 | | | | | | 78 | | | | | | — | | | | | | 72,419 | | |
Balance as of December 31, 2021 | | | | $ | 1,319,428 | | | | | $ | 50,008 | | | | | $ | 10,477 | | | | | $ | 1,379,913 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2020 | | | | $ | 22,358 | | | | | $ | 78 | | | | | $ | — | | | | | $ | 22,436 | | |
Purchases | | | | | 7,000 | | | | | | — | | | | | | — | | | | | | 7,000 | | |
Additions from business combination | | | | | 47,017 | | | | | | — | | | | | | — | | | | | | 47,017 | | |
Disposals | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Balance as of December 31, 2020 | | | | $ | 76,375 | | | | | $ | 78 | | | | | $ | — | | | | | $ | 76,453 | | |
Accumulated Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2020 | | | | | 1,880 | | | | | | — | | | | | | — | | | | | | 1,880 | | |
Amortization | | | | | 2,154 | | | | | | — | | | | | | — | | | | | | 2,154 | | |
Balance as of December 31, 2020 | | | | $ | 4,034 | | | | | $ | — | | | | | $ | — | | | | | $ | 4,034 | | |
Net Book Value | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2020 | | | | | 20,478 | | | | | | 78 | | | | | | — | | | | | | 20,556 | | |
Balance as of December 31, 2020 | | | | $ | 72,341 | | | | | $ | 78 | | | | | | — | | | | | $ | 72,419 | | |
Year Ending December 31: | | | Estimated Amortization | | |||
2022 | | | | $ | 99,057 | | |
2023 | | | | | 99,057 | | |
2024 | | | | | 99,057 | | |
2025 | | | | | 99,057 | | |
2026 | | | | | 99,057 | | |
Thereafter | | | | | 884,628 | | |
| | | | $ | 1,379,913 | | |
| | | January 1, 2020 | | | Impairment | | | Adjustments to purchase price allocation | | | Acquisitions | | | December 31, 2020 | | |||||||||||||||
Cultivation | | | | $ | 64 | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | 64 | | |
Retail | | | | | 5,000 | | | | | | — | | | | | | — | | | | | | 10,965 | | | | | | 15,965 | | |
| | | | $ | 5,064 | | | | | $ | — | | | | | $ | — | | | | | $ | 10,965 | | | | | $ | 16,029 | | |
| | | January 1, 2021 | | | Impairment | | | Adjustments to purchase price allocation | | | Acquisitions | | | December 31, 2021 | | |||||||||||||||
Cultivation | | | | $ | 64 | | | | | $ | — | | | | | $ | 312 | | | | | $ | 90,740 | | | | | $ | 91,116 | | |
Retail | | | | | 15,965 | | | | | | — | | | | | | (30) | | | | | | 261,079 | | | | | | 277,014 | | |
| | | | $ | 16,029 | | | | | $ | — | | | | | $ | 282 | | | | | $ | 351,819 | | | | | $ | 368,130 | | |
| | | Twelve Months Ended December 31, 2021 | | | Twelve Months Ended December 31, 2020 | | | Twelve Months Ended December 31, 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Numerator | | | | | | | | | | | | | | | | | | | |
Net Income (Loss) attributable to Verano Holdings Corp. | | | | $ | (57,507) | | | | | $ | 38,401 | | | | | $ | (18,273) | | |
Denominator | | | | | | | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | 158,203,932 | | | | | | | | | | | | | | |
Post-RTO weighted-average shares outstanding | | | | | 307,177,442 | | | | | | | | | | | | | | |
Weighted-average shares outstanding – basic | | | | | 290,443,432 | | | | | | 263,919,366 | | | | | | 261,432,115 | | |
Diluted | | | | | | | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | 158,203,932 | | | | | | | | | | | | | | |
Post-RTO weighted-average shares outstanding | | | | | 307,177,442 | | | | | | | | | | | | | | |
Weighted-average shares outstanding – diluted | | | | | 290,443,432 | | | | | | 270,719,280 | | | | | | 261,432,115 | | |
Basic earnings per share | | | | $ | (0.20) | | | | | $ | 0.15 | | | | | $ | (0.07) | | |
Diluted earnings per share | | | | $ | (0.20) | | | | | $ | 0.14 | | | | | $ | (0.07) | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
Cash | | | | $ | 5,446 | | | | | $ | 507 | | | | | $ | 5,953 | | |
Accounts receivable, net | | | | | 60 | | | | | | 498 | | | | | | 558 | | |
Inventory | | | | | 83,205 | | | | | | 5,827 | | | | | | 89,032 | | |
Prepaids and other current assets | | | | | 833 | | | | | | 1,989 | | | | | | 2,822 | | |
Property, plant and equipment, net | | | | | 73,386 | | | | | | 9,751 | | | | | | 83,137 | | |
Right-of-use asset, net | | | | | 9,651 | | | | | | — | | | | | | 9,651 | | |
Other assets | | | | | 1,001 | | | | | | — | | | | | | 1,001 | | |
Accounts payable and accrued liabilities | | | | | (8,935) | | | | | | (2,576) | | | | | | (11,511) | | |
Notes payable | | | | | (3,579) | | | | | | (3,343) | | | | | | (6,922) | | |
Deferred taxes | | | | | (123,720) | | | | | | (37,290) | | | | | | (161,010) | | |
Lease liabilities | | | | | (9,651) | | | | | | — | | | | | | (9,651) | | |
Total identifiable net assets (liabilities) | | | | | 27,697 | | | | | | (24,637) | | | | | | 3,060 | | |
Intangible assets | | | | | 498,938 | | | | | | 184,588 | | | | | | 683,526 | | |
Net assets | | | | $ | 526,635 | | | | | $ | 159,951 | | | | | $ | 686,586 | | |
| | AltMed Florida | | AltMed Arizona | | Total | | | AltMed Florida | | AltMed Arizona | | Total | | ||||||||||||||||||||||||
License | | | $ | 319,928 | | | | $ | 130,670 | | | | $ | 450,598 | | | | | $ | 319,928 | | | | $ | 130,670 | | | | $ | 450,598 | | | ||||||
Tradename | | | | 36,278 | | | | | 8,980 | | | | | 45,258 | | | | | | 36,278 | | | | | 8,980 | | | | | 45,258 | | | ||||||
Technology | | | | 10,603 | | | | | 885 | | | | | 11,488 | | | | | | 10,603 | | | | | 885 | | | | | 11,488 | | | ||||||
Total intangible assets | | | $ | 366,809 | | | | $ | 140,536 | | | | $ | 507,344 | | | | | $ | 366,809 | | | | $ | 140,536 | | | | $ | 507,344 | | | ||||||
Goodwill (residual purchase price) | | | $ | 8,409 | | | | $ | 6,763 | | | | $ | 15,172 | | | | | $ | 8,409 | | | | $ | 6,763 | | | | $ | 15,172 | | | ||||||
Goodwill (deferred taxes)(a) | | | | 123,720 | | | | | 37,290 | | | | | 161,010 | | | | | | 123,720 | | | | | 37,290 | | | | | 161,010 | | | ||||||
Total goodwill | | ��� | | $ | 132,129 | | | | $ | 44,053 | | | | $ | 176,182 | | | | | $ | 132,129 | | | | $ | 44,053 | | | | $ | 176,182 | | |
| | | Consolidated Results | | | AltMed Pre-acquisition | | | Pro-forma Results | | |||||||||
Revenues, net of discounts | | | | | 737,850 | | | | | | 22,402 | | | | | | 760,252 | | |
Net income (loss) | | | | | (57,507) | | | | | | 10,933 | | | | | | (46,574) | | |
| | | Glass City Alternatives | | | Perpetual Healthcare | | | The Herbal Care Center | | | Local Joint | | | Total | | |||||||||||||||
Cash and cash equivalents | | | | $ | 178 | | | | | $ | 478 | | | | | $ | 2,168 | | | | | $ | 540 | | | | | $ | 3,364 | | |
Accounts receivable, net | | | | | — | | | | | | — | | | | | | 2,000 | | | | | | — | | | | | | 2,000 | | |
Notes receivable | | | | | — | | | | | | — | | | | | | — | | | | | | 398 | | | | | | 398 | | |
Inventory | | | | | 58 | | | | | | 422 | | | | | | 1,435 | | | | | | 219 | | | | | | 2,134 | | |
Prepaid and other current assets | | | | | 50 | | | | | | 43 | | | | | | 109 | | | | | | — | | | | | | 202 | | |
Property, plant and equipment, net | | | | | 502 | | | | | | 135 | | | | | | 1,642 | | | | | | 451 | | | | | | 2,730 | | |
Right-of-use asset, net | | | | | 63 | | | | | | 215 | | | | | | 936 | | | | | | 2,480 | | | | | | 3,694 | | |
Accounts payable and accrued liabilities | | | | | (17) | | | | | | (200) | | | | | | (3,307) | | | | | | (216) | | | | | | (3,740) | | |
Deferred income tax | | | | | — | | | | | | (6,548) | | | | | | (11,914) | | | | | | — | | | | | | (18,462) | | |
| | | Glass City Alternatives | | | Perpetual Healthcare | | | The Herbal Care Center | | | Local Joint | | | Total | | |||||||||||||||
Lease liabilities | | | | | (63) | | | | | | (215) | | | | | | (936) | | | | | | (2,480) | | | | | | (3,694) | | |
Total identifiable net assets (liabilities) | | | | | 771 | | | | | | (5,670) | | | | | | (7,867) | | | | | | 1,392 | | | | | | (11,374) | | |
Intangible assets | | | | | 2,721 | | | | | | 33,387 | | | | | | 51,304 | | | | | | 16,095 | | | | | | 103,507 | | |
Net Assets | | | | $ | 3,492 | | | | | $ | 27,717 | | | | | $ | 43,437 | | | | | $ | 17,487 | | | | | $ | 92,133 | | |
|
| | | BISHCO LLC | | | TerraVida Holistic Centers | | | The Healing Center | | | Total | | ||||||||||||
Cash and cash equivalents | | | | $ | 1,809 | | | | | $ | 3,222 | | | | | $ | 3,496 | | | | | $ | 8,527 | | |
Accounts receivable, net | | | | | 231 | | | | | | — | | | | | | — | | | | | | 231 | | |
Inventory | | | | | 7,162 | | | | | | 4,091 | | | | | | 3,088 | | | | | | 14,341 | | |
Prepaid & other current assets | | | | | 1,127 | | | | | | 692 | | | | | | 810 | | | | | | 2,629 | | |
Deposits & other non-current assets | | | | | 8 | | | | | | 75 | | | | | | — | | | | | | 83 | | |
Property, plant and equipment, net | | | | | 7,872 | | | | | | 2,612 | | | | | | 11,412 | | | | | | 21,896 | | |
Right-of-use asset, net | | | | | 129 | | | | | | 2,122 | | | | | | — | | | | | | 2,251 | | |
Accounts payable and accrued liabilities | | | | | (2,770) | | | | | | (1,635) | | | | | | (2,569) | | | | | | (6,974) | | |
Other liabilities | | | | | (1,188) | | | | | | — | | | | | | — | | | | | | (1,188) | | |
Deferred income tax | | | | | (23,598) | | | | | | — | | | | | | — | | | | | | (23,598) | | |
Lease liabilities | | | | | (129) | | | | | | (2,122) | | | | | | — | | | | | | (2,251) | | |
Total identifiable net assets (liabilities) | | | | | (9,347) | | | | | | 9,057 | | | | | | 16,237 | | | | | | 15,947 | | |
Intangible assets | | | | | 126,120 | | | | | | 116,053 | | | | | | 133,804 | | | | | | 375,977 | | |
Net Assets | | | | $ | 116,773 | | | | | $ | 125,110 | | | | | $ | 150,041 | | | | | $ | 391,924 | | |
| | | Mad River Remedies | | | Agronomed Biologics | | | Agri Kind & Agronomed Holdings Inc | | | Total | | ||||||||||||
Cash and cash equivalents | | | | $ | 755 | | | | | $ | 2,300 | | | | | $ | 2,024 | | | | | $ | 5,079 | | |
Accounts receivable, net | | | | | 262 | | | | | | — | | | | | | 560 | | | | | | 822 | | |
Inventory | | | | | 396 | | | | | | 623 | | | | | | 4,188 | | | | | | 5,207 | | |
Prepaid & other current assets | | | | | 85 | | | | | | 273 | | | | | | 653 | | | | | | 1,011 | | |
Deposits & other non-current assets | | | | | — | | | | | | 40 | | | | | | — | | | | | | 40 | | |
Property, plant and equipment, net | | | | | 589 | | | | | | 5,844 | | | | | | 35,965 | | | | | | 42,398 | | |
Right-of-use asset, net | | | | | 125 | | | | | | 2,715 | | | | | | — | | | | | | 2,840 | | |
Accounts payable and accrued liabilities | | | | | (478) | | | | | | (1,126) | | | | | | (1,852) | | | | | | (3,456) | | |
Other liabilities | | | | | — | | | | | | (2,788) | | | | | | (14,730) | | | | | | (17,518) | | |
| | | Mad River Remedies | | | Agronomed Biologics | | | Agri Kind & Agronomed Holdings Inc | | | Total | | ||||||||||||
Deferred income tax | | | | | — | | | | | | (29,913) | | | | | | — | | | | | | (29,913) | | |
Lease liabilities | | | | | (125) | | | | | | (2,715) | | | | | | — | | | | | | (2,840) | | |
Total identifiable net assets (liabilities) | | | | | 1,609 | | | | | | (24,747) | | | | | | 26,808 | | | | | | 3,670 | | |
Total Intangible assets | | | | | 19,218 | | | | | | 129,222 | | | | | | 137,678 | | | | | | 286,118 | | |
Net Assets | | | | $ | 20,827 | | | | | $ | 104,475 | | | | | $ | 164,486 | | | | | $ | 289,788 | | |
|
| | | Willow Brook | | | Caring Nature | | | CT Pharma | | | Total | | ||||||||||||
Cash and cash equivalents | | | | $ | 443 | | | | | $ | 251 | | | | | $ | 2,793 | | | | | $ | 3,487 | | |
Accounts receivable, net | | | | | — | | | | | | — | | | | | | 1,314 | | | | | | 1,314 | | |
Inventory | | | | | 243 | | | | | | 155 | | | | | | 10,582 | | | | | | 10,980 | | |
Prepaid & other current Assets | | | | | 92 | | | | | | 41 | | | | | | 1,036 | | | | | | 1,169 | | |
Deposits and other non-current assets | | | | | 3 | | | | | | — | | | | | | — | | | | | | 3 | | |
Property, plant and equipment, net | | | | | 282 | | | | | | 91 | | | | | | 24,638 | | | | | | 25,011 | | |
Right-of-use asset, net | | | | | 54 | | | | | | 133 | | | | | | — | | | | | | 187 | | |
Accounts payable and accrued liabilities | | | | | (99) | | | | | | (11) | | | | | | (2,213) | | | | | | (2,323) | | |
Other liabilities | | | | | — | | | | | | — | | | | | | (2,800) | | | | | | (2,800) | | |
Deferred income tax | | | | | — | | | | | | (7,123) | | | | | | (40,062) | | | | | | (47,185) | | |
Lease liabilities | | | | | (54) | | | | | | (133) | | | | | | — | | | | | | (187) | | |
Total identifiable net assets (liabilities) | | | | | 964 | | | | | | (6,596) | | | | | | (4,712) | | | | | | (10,344) | | |
Total Intangible assets | | | | | 21,705 | | | | | | 32,878 | | | | | | 168,464 | | | | | | 223,047 | | |
Net Assets | | | | $ | 22,669 | | | | | $ | 26,282 | | | | | $ | 163,752 | | | | | $ | 212,703 | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 375,225 | | | | | $ | 203,895 | | | | | $ | 158,730 | | | | | $ | 737,850 | | |
Net income (loss) | | | | | (59,759) | | | | | | 7,398 | | | | | | (5,146) | | | | | | (57,507) | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 375,225 | | | | | $ | 226,297 | | | | | $ | 309,315 | | | | | $ | 910,837 | | |
Pro forma net income (loss) | | | | | (59,759) | | | | | | 18,331 | | | | | | 31,553 | | | | | | (9,875) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) Intangible amortization | | | | | — | | | | | | 32,798 | | | | | | 30,171 | | | | | | 62,969 | | |
(b) Inventory step up | | | | | — | | | | | | 71,538 | | | | | | 9,450 | | | | | | 80,988 | | |
Total pro forma adjustments | | | | | — | | | | | | 104,336 | | | | | | 39,621 | | | | | | 143,957 | | |
Total pro forma net income (loss) | | | | $ | (59,759) | | | | | $ | 122,667 | | | | | $ | 71,174 | | | | | $ | 134,082 | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 228,530 | | | | | $ | 126,309 | | | | | $ | 238,218 | | | | | $ | 593,057 | | |
Pro forma net income (loss) | | | | | 38,401 | | | | | | 64,809 | | | | | | 53,500 | | | | | | 156,710 | | |
| | | MME IL | | | Elevele | | | Other | | | Total | | ||||||||||||
Cash and cash equivalents | | | | $ | 329 | | | | | $ | 1,035 | | | | | $ | — | | | | | $ | 1,364 | | |
Inventory | | | | | 553 | | | | | | 431 | | | | | | — | | | | | | 984 | | |
Prepaid & other current assets | | | | | 3 | | | | | | 366 | | | | | | — | | | | | | 369 | | |
Property, plant and equipment, net | | | | | 1,053 | | | | | | 38 | | | | | | 1,420 | | | | | | 2,511 | | |
Right-of-use asset, net | | | | | — | | | | | | 44 | | | | | | — | | | | | | 44 | | |
Accounts payable and accrued liabilities | | | | | (941) | | | | | | (1,109) | | | | | | (350) | | | | | | (2,400) | | |
Deferred income tax | | | | | (5,767) | | | | | | (6,548) | | | | | | — | | | | | | (12,315) | | |
Lease liabilities | | | | | (123) | | | | | | (68) | | | | | | — | | | | | | (191) | | |
Investments in associates | | | | | — | | | | | | — | | | | | | (580) | | | | | | (580) | | |
Total identifiable net assets (liabilities) | | | | | (4,893) | | | | | | (5,811) | | | | | | 490 | | | | | | (10,214) | | |
Total Intangible assets | | | | | 24,923 | | | | | | 28,113 | | | | | | 6,640 | | | | | | 59,676 | | |
Net Assets | | | | $ | 20,030 | | | | | $ | 22,302 | | | | | $ | 7,130 | | | | | $ | 49,462 | | |
| | | As of | | |||||||||
| | | December 31, 2021 | | | December 31, 2020 | | ||||||
Credit Facility | | | | $ | 250,000 | | | | | $ | 30,000 | | |
Secured Promissory Notes | | | | | 6,663 | | | | | | 7,410 | | |
Convertible Note | | | | | — | | | | | | 3,709 | | |
Mortgage Loans | | | | | 38,856 | | | | | | — | | |
Vehicle and Equipment Loans | | | | | 1,951 | | | | | | — | | |
Unamortized debt issuance costs | | | | | (7,545) | | | | | | (825) | | |
Total notes payable | | | | $ | 289,925 | | | | | $ | 40,294 | | |
Less: current portion of notes payable | | | | | 13,771 | | | | | | 7,814 | | |
Total long-term debt, net | | | | $ | 276,154 | | | | | $ | 32,480 | | |
| | | Principal Payments | | | Unamortized Debt Issuance Costs | | | Total Notes Payable | | |||||||||
2022 | | | | $ | 19,222 | | | | | $ | 5,451 | | | | | $ | 13,771 | | |
2023 | | | | | 264,841 | | | | | | 2,094 | | | | | | 262,747 | | |
2024 | | | | | 3,120 | | | | | | — | | | | | | 3,120 | | |
2025 | | | | | 1,848 | | | | | | — | | | | | | 1,848 | | |
2026 | | | | | 260 | | | | | | — | | | | | | 260 | | |
Thereafter | | | | | 8,179 | | | | | | — | | | | | | 8,179 | | |
Total | | | | $ | 297,470 | | | | | $ | 7,545 | | | | | $ | 289,925 | | |
| | | December 31, 2021 | |
Risk free interest rate | | | 0.04% – 0.95% | |
Expected dividend yield | | | 0% | |
Expected volatility | | | 124.59% | |
Expected option life | | | 2.5 years | |
| | | Years Ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Current: | | | | | | | | | | | | | | | | | | | |
Federal | | | | $ | 104,014 | | | | | $ | 29,627 | | | | | $ | 7,935 | | |
State | | | | | 33,084 | | | | | | 11,130 | | | | | | 2,721 | | |
Foreign | | | | | — | | | | | | — | | | | | | — | | |
Total Current: | | | | | 137,098 | | | | | | 40,757 | | | | | | 10,656 | | |
Deferred: | | | | | | | | | | | | | | | | | | | |
Federal | | | | $ | (25,540) | | | | | $ | 1,073 | | | | | $ | (253) | | |
State | | | | | (7,570) | | | | | | 466 | | | | | | (70) | | |
Foreign | | | | | — | | | | | | — | | | | | | — | | |
Total Deferred | | | | | (33,110) | | | | | | 1,539 | | | | | | (323) | | |
Total | | | | $ | 103,988 | | | | | $ | 42,296 | | | | | $ | 10,333 | | |
| | | Years Ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Income/(Loss) before Income Taxes | | | | $ | 48,990 | | | | | $ | 82,452 | | | | | $ | (8,491) | | |
Statutory Tax rates | | | | | 21% | | | | | | 21% | | | | | | 21% | | |
Expense/(Recovery) based on Statutory Rates | | | | | 9,965 | | | | | | 17,315 | | | | | | (1,784) | | |
Other Permanent Difference | | | | | 435 | | | | | | (1,309) | | | | | | — | | |
Nondeductible 280E | | | | | 59,874 | | | | | | 10,663 | | | | | | 7,018 | | |
| | | Years Ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Penalties | | | | | 5,331 | | | | | | — | | | | | | — | | |
Noncontrolling interests | | | | | 411 | | | | | | 3,506 | | | | | | 1,795 | | |
State | | | | | 25,001 | | | | | | 11,277 | | | | | | 3,304 | | |
Book/Tax Basis Acquired Intangibles | | | | | — | | | | | | 2,445 | | | | | | — | | |
Prior Year True Up | | | | | 3,068 | | | | | | (1,601) | | | | | | — | | |
Discrete Items | | | | | (420) | | | | | | | | | | | | | | |
Other Differences | | | | | — | | | | | | — | | | | | | — | | |
Income Tax Expense | | | | $ | 103,988 | | | | | $ | 42,296 | | | | | $ | 10,333 | | |
|
| | | Years Ended December 31, | | |||||||||
| | | 2021 | | | 2020 | | ||||||
| | | (As Restated) | | | | | | | | |||
Deferred Tax Assets | | | | | | | | | | | | | |
Lease Liabilities | | | | $ | 515 | | | | | $ | 549 | | |
Loyalty Point | | | | | 730 | | | | | | 752 | | |
Stock Compensation | | | | | 800 | | | | | | — | | |
Total Deferred Tax Assets | | | | | 2,045 | | | | | | 1,301 | | |
Deferred Tax Liabilities | | | | | | | | | | | | | |
Operating Right of Use Assets | | | | $ | (513) | | | | | $ | (484) | | |
Intangibles | | | | | (263,716) | | | | | | (15,641) | | |
Total Deferred Tax Liabilities | | | | | (264,229) | | | | | | (16,125) | | |
Net Deferred Tax Liabilities | | | | $ | (262,184) | | | | | $ | (14,824) | | |
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
Weighted average remaining lease term | | | | | 8.52 | | | | | | 6.66 | | | | | | 6.08 | | |
Weighted average discount rate | | | | | 8.11% | | | | | | 8.81% | | | | | | 8.0% | | |
| Year Ending December 31: | | | | | | | |
| 2022 | | | | $ | 11,457 | | |
| 2023 | | | | | 11,024 | | |
| 2024 | | | | | 10,348 | | |
| 2025 | | | | | 9,717 | | |
| 2026 | | | | | 8,818 | | |
| Thereafter | | | | | 38,177 | | |
| Total Lease Payments | | | | | 89,541 | | |
| Less: Interest | | | | | (26,166) | | |
| Present Value of Lease Liability | | | | $ | 63,375 | | |
| | | Year Ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Revenue, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 217,739 | | | | | $ | 156,223 | | | | | $ | 46,068 | | |
Retail | | | | | 591,591 | | | | | | 88,470 | | | | | | 22,925 | | |
Intersegment Eliminations | | | | | (71,480) | | | | | | (16,163) | | | | | | (3,025) | | |
Total revenue, net of discounts | | | | $ | 737,850 | | | | | $ | 228,530 | | | | | $ | 65,968 | | |
Depreciation and amortization | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 54,460 | | | | | $ | 8,256 | | | | | $ | 3,394 | | |
Retail | | | | | 41,784 | | | | | | 2,278 | | | | | | 2,288 | | |
Total depreciation and amortization | | | | $ | 96,244 | | | | | $ | 10,534 | | | | | $ | 5,682 | | |
Capital expenditures | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 91,549 | | | | | $ | 45,699 | | | | | $ | 46,930 | | |
Retail | | | | | 56,170 | | | | | | 14,454 | | | | | | 12,111 | | |
Total capital expenditures | | | | $ | 147,719 | | | | | $ | 60,153 | | | | | $ | 59,041 | | |
Income taxes | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 58,601 | | | | | $ | 21,989 | | | | | $ | 4,011 | | |
Retail | | | | | 45,387 | | | | | | 20,307 | | | | | | 6,322 | | |
Total income taxes | | | | $ | 103,988 | | | | | $ | 42,296 | | | | | $ | 10,333 | | |
Net income (loss) | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 53,191 | | | | | $ | 69,706 | | | | | $ | 12,707 | | |
Retail | | | | | (110,698) | | | | | | (31,305) | | | | | | (30,980) | | |
Total net income (loss) | | | | $ | (57,507) | | | | | $ | 38,401 | | | | | $ | (18,273) | | |
| | | As of December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Assets | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 1,278,308 | | | | | $ | 173,058 | | | | | $ | 72,455 | | |
Retail | | | | | 1,270,347 | | | | | | 156,593 | | | | | | 108,388 | | |
Total assets | | | | $ | 2,548,655 | | | | | $ | 329,651 | | | | | $ | 180,843 | | |
Liabilities | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 230,217 | | | | | $ | 28,760 | | | | | $ | 29,502 | | |
Retail | | | | | 836,632 | | | | | | 147,493 | | | | | | 39,313 | | |
Total liabilities | | | | $ | 1,066,849 | | | | | $ | 176,253 | | | | | $ | 68,815 | | |
| | | Consolidated VIE | | | Consolidated VOE | | | Consolidated VIE | | |||||||||
| | | December 31, 2021 | | | December 31, 2020 | | ||||||||||||
| | | (As Restated) | | | | | | | | |||||||||
Current Assets | | | | $ | 43,045 | | | | | $ | 20,464 | | | | | $ | 23,141 | | |
Due To/(From) | | | | | (25,723) | | | | | | 14,228 | | | | | | (66,353) | | |
Non-Current Assets | | | | | 207,908 | | | | | | 226,108 | | | | | | 145,618 | | |
Current Liabilities | | | | | 32,934 | | | | | | 22,659 | | | | | | 18,319 | | |
Non-Current Liabilities | | | | | 45,873 | | | | | | 45,603 | | | | | | 7,733 | | |
Non-Controlling Interest | | | | | 1,276 | | | | | | — | | | | | | 6,237 | | |
Equity attributable to Verano Holdings, Corp. | | | | | 145,147 | | | | | | 192,538 | | | | | | 76,354 | | |
| | | As of December 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 99,118 | | | | | $ | — | | | | | $ | — | | | | | $ | 99,118 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (208,349) | | | | | | (208,349) | | |
Total | | | | $ | 99,118 | | | | | $ | — | | | | | $ | (208,349) | | | | | $ | (109,231) | | |
| | | As of December 31, 2020 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 16,402 | | | | | $ | — | | | | | $ | — | | | | | $ | 16,402 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (33,290) | | | | | | (33,290) | | |
Total | | | | $ | 16,402 | | | | | $ | — | | | | | $ | (33,290) | | | | | $ | (16,888) | | |
| | | PAGE | |
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Financial Statements: | | | ||
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| | | ||
| | | ||
| | | ||
Supplementary Information: | | | ||
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| | | ||
| | | ||
| | |
| | | 2020 | | | 2019 | | ||||||
ASSETS | | | | | | | | | | | | | |
CURRENT ASSETS | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 13,577,455 | | | | | $ | 4,985,739 | | |
Accounts receivable | | | | | 80,145 | | | | | | 452,828 | | |
Inventory | | | | | 13,639,351 | | | | | | 5,252,829 | | |
Other current assets | | | | | 1,285,983 | | | | | | 744,969 | | |
TOTAL CURRENT ASSETS | | | | | 28,582,934 | | | | | | 11,436,365 | | |
PROPERTY AND EQUIPMENT, NET | | | | | 74,418,774 | | | | | | 38,711,368 | | |
DEPOSITS | | | | | 891,614 | | | | | | 530,883 | | |
| | | | $ | 103,893,322 | | | | | $ | 50,678,616 | | |
LIABILITIES AND MEMBERS’ EQUITY | | | | | | | | | | | | | |
CURRENT LIABILITIES | | | | | | | | | | | | | |
Accounts payable and accrued expenses | | | | $ | 15,982,661 | | | | | $ | 5,625,092 | | |
Current portion of lease liabilities | | | | | 963,050 | | | | | | 452,597 | | |
Current portion of long-term debt | | | | | 209,889 | | | | | | 75,931 | | |
TOTAL CURRENT LIABILITIES | | | | | 17,155,600 | | | | | | 6,153,620 | | |
LONG-TERM LIABILITIES | | | | | | | | | | | | | |
Lease liabilities | | | | | 15,233,450 | | | | | | 8,414,741 | | |
Notes payable – related parties | | | | | 3,670,000 | | | | | | 2,500,000 | | |
Long-term debt | | | | | 732,414 | | | | | | 307,565 | | |
TOTAL LIABILITIES | | | | | 36,791,464 | | | | | | 17,375,926 | | |
MEMBERS’ EQUITY | | | | | 67,101,858 | | | | | | 33,302,690 | | |
| | | | $ | 103,893,322 | | | | | $ | 50,678,616 | | |
| | | 2020 | | | 2019 | | ||||||
OPERATING INCOME | | | | | | | | | | | | | |
Sales | | | | $ | 105,660,570 | | | | | $ | 39,371,011 | | |
Cost of sales | | | | | 23,360,353 | | | | | | 11,982,151 | | |
GROSS PROFIT | | | | | 82,300,217 | | | | | | 27,388,860 | | |
OPERATING EXPENSES | | | | | | | | | | | | | |
Advertising | | | | | 981,872 | | | | | | 607,327 | | |
Amortization | | | | | 0 | | | | | | 343,393 | | |
Contract labor and consulting | | | | | 633,799 | | | | | | 456,152 | | |
Depreciation | | | | | 4,475,627 | | | | | | 2,557,265 | | |
Insurance | | | | | 2,173,843 | | | | | | 958,231 | | |
Payroll – officers | | | | | 340,000 | | | | | | 321,875 | | |
Payroll – other | | | | | 20,587,619 | | | | | | 7,736,222 | | |
Other operating expenses | | | | | 11,791,410 | | | | | | 5,907,236 | | |
Less direct costs allocated to inventory and cost of sales | | | | | (19,737,803) | | | | | | (9,788,609) | | |
TOTAL OPERATING EXPENSES | | | | | 21,246,367 | | | | | | 9,099,092 | | |
INCOME FROM OPERATIONS | | | | | 61,053,850 | | | | | | 18,289,768 | | |
OTHER INCOME (EXPENSES) | | | | | | | | | | | | | |
ATM commissions | | | | | 109,017 | | | | | | 35,869 | | |
Interest expense | | | | | (1,423,038) | | | | | | (334,064) | | |
Other expense | | | | | 59,339 | | | | | | (7,178) | | |
| | | | | (1,254,682) | | | | | | (305,373) | | |
NET INCOME | | | | $ | 59,799,168 | | | | | $ | 17,984,395 | | |
| | | MEMBERSHIP UNITS | | | MEMBERS’ EQUITY | | | TOTAL | | |||||||||
Balance at January 1, 2019 | | | | $ | 23,286,337 | | | | | $ | (7,224,354) | | | | | $ | 16,061,983 | | |
Adoption of ASC 842, Leases | | | | | 0 | | | | | | (43,688) | | | | | | (43,688) | | |
Distributions paid to members | | | | | 0 | | | | | | (700,000) | | | | | | (700,000) | | |
Net income | | | | | 0 | | | | | | 17,984,395 | | | | | | 17,984,395 | | |
Balance at December 31, 2019 | | | | | 23,286,337 | | | | | | 10,016,353 | | | | | | 33,302,690 | | |
Distributions paid to members | | | | | 0 | | | | | | (26,000,000) | | | | | | (26,000,000) | | |
Net income | | | | | 0 | | | | | | 59,799,168 | | | | | | 59,799,168 | | |
Balance at December 31, 2020 | | | | $ | 23,286,337 | | | | | $ | 43,815,521 | | | | | $ | 67,101,858 | | |
| | | 2020 | | | 2019 | | ||||||
RECONCILIATION OF NET INCOME TO NET CASH | | | | | | | | | | | | | |
PROVIDED BY OPERATING ACTIVITIES | | | | | | | | | | | | | |
Net income | | | | $ | 59,799,168 | | | | | $ | 17,984,395 | | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 4,475,627 | | | | | | 2,900,658 | | |
Changes in assets and liabilities: | | | | | | | | | | | | | |
Decrease in accounts receivable | | | | | 372,683 | | | | | | 39,532 | | |
Increase in inventory | | | | | (8,386,522) | | | | | | (2,647,202) | | |
Increase in other current assets | | | | | (541,014) | | | | | | (486,346) | | |
Increase in deposits | | | | | (360,731) | | | | | | (262,375) | | |
Increase in accounts payable and accrued expenses | | | | | 10,944,342 | | | | | | 2,778,348 | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 66,303,553 | | | | | | 20,307,010 | | |
CASH FLOWS FROM INVESTING ACTIVITIES | | | | | | | | | | | | | |
Purchase of property and equipment | | | | | (32,045,814) | | | | | | (18,052,535) | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (32,045,814) | | | | | | (18,052,535) | | |
CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | | | | | | | | |
Member distributions | | | | | (26,000,000) | | | | | | (700,000) | | |
Payments on notes payable – related parties | | | | | (2,500,000) | | | | | | (935,340) | | |
Issuance of notes payable – related parties | | | | | 3,670,000 | | | | | | 0 | | |
Payments on long-term debt | | | | | (145,005) | | | | | | 0 | | |
Payments on lease liabilities | | | | | (691,018) | | | | | | 0 | | |
Borrowings on long-term debt | | | | | 0 | | | | | | 283,700 | | |
NET CASH USED IN FINANCING ACTIVITIES | | | | | (25,666,023) | | | | | | (1,351,640) | | |
NET INCREASE IN CASH AND CASH EQUIVALENTS | | | | | 8,591,716 | | | | | | 902,835 | | |
CASH AND CASH EQUIVALENTS | | | | | | | | | | | | | |
Beginning of year | | | | | 4,985,739 | | | | | | 4,082,904 | | |
End of year | | | | $ | 13,577,455 | | | | | $ | 4,985,739 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION | | | | | | | | | | | | | |
Cash paid during the year for interest | | | | $ | 1,423,038 | | | | | $ | 47,100 | | |
Acquisition of vehicles in exchange for long-term debt | | | | $ | 703,812 | | | | | $ | 85,340 | | |
Construction costs paid for on account | | | | $ | 586,773 | | | | | $ | 2,331,072 | | |
Additions of right-of-use assets | | | | $ | 8,020,181 | | | | | $ | 7,060,833 | | |
| | | YEARS | |
Buildings | | | 39 | |
Leasehold improvements | | | 5 – 39 | |
Machinery and equipment | | | 5 – 15 | |
Furniture and fixtures | | | 5 – 7 | |
Lab equipment | | | 5 | |
Computer equipment | | | 5 | |
Vehicles | | | 5 | |
| | | 2020 | | | 2019 | | ||||||
Raw materials | | | | $ | 1,717,832 | | | | | $ | 1,631,427 | | |
Work-in-process | | | | | 8,217,661 | | | | | | 2,056,167 | | |
Finished goods | | | | | 3,703,858 | | | | | | 1,565,235 | | |
TOTALS | | | | $ | 13,639,351 | | | | | $ | 5,252,829 | | |
| | | 2020 | | | 2019 | | ||||||
Prepaid expenses | | | | $ | 1,245,237 | | | | | $ | 585,644 | | |
Related party receivables | | | | | 40,246 | | | | | | 156,225 | | |
Other receivables | | | | | 500 | | | | | | 3,100 | | |
TOTALS | | | | $ | 1,285,983 | | | | | $ | 744,969 | | |
| | | 2020 | | | 2019 | | ||||||
Leasehold improvements | | | | $ | 28,725,581 | | | | | $ | 21,311,063 | | |
Machinery and equipment | | | | | 12,366,444 | | | | | | 3,948,076 | | |
Buildings | | | | | 19,166,872 | | | | | | 1,989,547 | | |
Lab equipment | | | | | 2,054,112 | | | | | | 1,927,148 | | |
Computer equipment | | | | | 3,422,752 | | | | | | 1,429,165 | | |
Land | | | | | 467,661 | | | | | | 391,661 | | |
Furniture and fixtures | | | | | 3,247,224 | | | | | | 1,274,095 | | |
Construction in process | | | | | 11,877,957 | | | | | | 9,217,850 | | |
Vehicles | | | | | 1,246,781 | | | | | | 474,380 | | |
| | | | | 82,575,384 | | | | | | 41,962,985 | | |
Less accumulated depreciation | | | | | 8,156,610 | | | | | | 3,251,617 | | |
NET PROPERTY AND EQUIPMENT | | | | $ | 74,418,774 | | | | | $ | 38,711,368 | | |
| | | 2020 | | | 2019 | | ||||||
Accounts payable – trade | | | | $ | 2,403,997 | | | | | $ | 2,707,203 | | |
Accrued expenses | | | | | 11,419,349 | | | | | | 2,534,935 | | |
Payroll liabilities | | | | | 2,015,500 | | | | | | 328,440 | | |
Accrued paid time-off | | | | | 137,030 | | | | | | 52,662 | | |
Other accrued expenses | | | | | 6,785 | | | | | | 1,852 | | |
TOTALS | | | | $ | 15,982,661 | | | | | $ | 5,625,092 | | |
| | | 2020 | | | 2019 | | ||||||
Notes payable to Ford Motor Credit, monthly payments totaling $8,952 including interest ranging from 7.7% – 10.9%, maturing through November 2024, secured by vehicles. | | | | $ | 942,303 | | | | | $ | 383,496 | | |
Notes payable to related parties, totaling $3,670,000, not including simple annual interest of 10%, maturing through March 2022. | | | | | 3,670,000 | | | | | | 0 | | |
| | | 2020 | | | 2019 | | ||||||
TOTAL DEBT | | | | | 4,612,303 | | | | | | 383,496 | | |
Less current portion | | | | | 209,889 | | | | | | 75,931 | | |
| | | | $ | 4,402,414 | | | | | $ | 307,565 | | |
|
| 2021 | | | | $ | 209,889 | | |
| 2022 | | | | | 3,896,936 | | |
| 2023 | | | | | 233,621 | | |
| 2024 | | | | | 203,743 | | |
| 2025 | | | | | 68,114 | | |
| TOTAL | | | | $ | 4,612,303 | | |
| | | 2020 | | | 2019 | | ||||||
Balance, beginning of year | | | | $ | 8,867,338 | | | | | $ | 1,816,496 | | |
Additions | | | | | 8,020,181 | | | | | | 7,298,121 | | |
| | | 2020 | | | 2019 | | ||||||
Lease and interest payments, accretion, and accrued interest, net | | | | | 691,019 | | | | | | 247,279 | | |
Balance, end of year | | | | | 16,196,500 | | | | | | 8,867,338 | | |
Lease liability – current portion | | | | | 963,050 | | | | | | 452,597 | | |
Lease liability – noncurrent portion | | | | $ | 15,233,450 | | | | | $ | 8,414,741 | | |
|
| 2021 | | | | $ | 2,224,879 | | |
| 2022 | | | | | 2,321,635 | | |
| 2023 | | | | | 2,399,379 | | |
| 2024 | | | | | 2,475,549 | | |
| 2025 | | | | | 2,527,179 | | |
| Thereafter | | | | | 11,725,546 | | |
| Total undiscounted lease liabilities | | | | | 23,674,167 | | |
| Interest on lease liabilities | | | | | (7,477,667) | | |
| Total present value of minimum lease payments | | | | | 16,196,500 | | |
| Lease liability – current portion | | | | | 963,050 | | |
| Lease liability – noncurrent | | | | $ | 15,233,450 | | |
| | | POR | | | RVC | | | GPS | | | Total Uncombined | | | Eliminations | | | Combined | | ||||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
CURRENT ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 13,571,860 | | | | | $ | 3,015 | | | | | $ | 2,580 | | | | | $ | 13,577,455 | | | | | $ | 0 | | | | | $ | 13,577,455 | | |
Accounts receivable | | | | | 80,145 | | | | | | 0 | | | | | | 0 | | | | | | 80,145 | | | | | | 0 | | | | | | 80,145 | | |
Inventory | | | | | 13,639,351 | | | | | | 0 | | | | | | 0 | | | | | | 13,639,351 | | | | | | 0 | | | | | | 13,639,351 | | |
Other current assets | | | | | 1,285,983 | | | | | | 0 | | | | | | 0 | | | | | | 1,285,983 | | | | | | 0 | | | | | | 1,285,983 | | |
TOTAL CURRENT ASSETS | | | | | 28,577,339 | | | | | | 3,015 | | | | | | 2,580 | | | | | | 28,582,934 | | | | | | 0 | | | | | | 28,582,934 | | |
PROPERTY AND EQUIPMENT, NET | | | | | 55,333,851 | | | | | | 19,084,923 | | | | | | 0 | | | | | | 74,418,774 | | | | | | 0 | | | | | | 74,418,774 | | |
OTHER ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Deposits | | | | | 852,341 | | | | | | 39,273 | | | | | | 0 | | | | | | 891,614 | | | | | | 0 | | | | | | 891,614 | | |
Due from related parties | | | | | 10,797,556 | | | | | | 0 | | | | | | 0 | | | | | | 10,797,556 | | | | | | (10,797,556) | | | | | | 0 | | |
TOTAL OTHER ASSETS | | | | | 11,649,897 | | | | | | 39,273 | | | | | | 0 | | | | | | 11,689,170 | | | | | | (10,797,556) | | | | | | 891,614 | | |
| | | | $ | 95,561,087 | | | | | $ | 19,127,211 | | | | | $ | 2,580 | | | | | $ | 114,690,878 | | | | | $ | (10,797,556) | | | | | $ | 103,893,322 | | |
LIABILITIES AND MEMBERS’ EQUITY | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
CURRENT LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts payable and accrued expenses | | | | $ | 5,982,661 | | | | | $ | 0 | | | | | $ | 10,000,000 | | | | | $ | 15,982,661 | | | | | $ | 0 | | | | | $ | 15,982,661 | | |
Current portion of lease liabilities | | | | | 963,050 | | | | | | 0 | | | | | | 0 | | | | | | 963,050 | | | | | | 0 | | | | | | 963,050 | | |
Current portion of long-term debt | | | | | 209,889 | | | | | | 0 | | | | | | 0 | | | | | | 209,889 | | | | | | 0 | | | | | | 209,889 | | |
TOTAL CURRENT LIABILITIES | | | | | 7,155,600 | | | | | | 0 | | | | | | 10,000,000 | | | | | | 17,155,600 | | | | | | 0 | | | | | | 17,155,600 | | |
LONG-TERM LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Due to related parties | | | | | 0 | | | | | | 0 | | | | | | 4,763,929 | | | | | | 4,763,929 | | | | | | (4,763,929) | | | | | | 0 | | |
Lease liabilities | | | | | 15,233,450 | | | | | | 0 | | | | | | 0 | | | | | | 15,233,450 | | | | | | 0 | | | | | | 15,233,450 | | |
Notes payable – related parties | | | | | 3,670,000 | | | | | | 0 | | | | | | 0 | | | | | | 3,670,000 | | | | | | 0 | | | | | | 3,670,000 | | |
Long-term debt | | | | | 732,414 | | | | | | 13,322,059 | | | | | | 0 | | | | | | 14,054,473 | | | | | | (13,322,059) | | | | | | 732,414 | | |
TOTAL LIABILITIES | | | | | 26,791,464 | | | | | | 13,322,059 | | | | | | 14,763,929 | | | | | | 54,877,452 | | | | | | (18,085,988) | | | | | | 36,791,464 | | |
MEMBERS’ EQUITY | | | | | 68,769,623 | | | | | | 5,805,152 | | | | | | (14,761,349) | | | | | | 59,813,426 | | | | | | 7,288,432 | | | | | | 67,101,858 | | |
| | | | $ | 95,561,087 | | | | | $ | 19,127,211 | | | | | $ | 2,580 | | | | | $ | 114,690,878 | | | | | $ | (10,797,556) | | | | | $ | 103,893,322 | | |
| | | POR | | | RVC | | | GPS | | | Total Uncombined | | | Eliminations | | | Combined | | ||||||||||||||||||
OPERATING INCOME | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sales | | | | $ | 105,660,570 | | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 105,660,570 | | | | | $ | 0 | | | | | $ | 105,660,570 | | |
Cost of sales | | | | | 25,886,039 | | | | | | 0 | | | | | | 0 | | | | | | 25,886,039 | | | | | | (2,525,686) | | | | | | 23,360,353 | | |
GROSS PROFIT | | | | | 79,774,531 | | | | | | 0 | | | | | | 0 | | | | | | 79,774,531 | | | | | | 2,525,686 | | | | | | 82,300,217 | | |
OPERATING EXPENSES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Advertising | | | | | 981,872 | | | | | | 0 | | | | | | 0 | | | | | | 981,872 | | | | | | 0 | | | | | | 981,872 | | |
Amortization | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | |
Contract labor and consulting | | | | | 423,799 | | | | | | 210,000 | | | | | | 0 | | | | | | 633,799 | | | | | | 0 | | | | | | 633,799 | | |
Depreciation | | | | | 2,112,705 | | | | | | 2,362,922 | | | | | | 0 | | | | | | 4,475,627 | | | | | | 0 | | | | | | 4,475,627 | | |
Insurance | | | | | 2,173,843 | | | | | | 0 | | | | | | 0 | | | | | | 2,173,843 | | | | | | 0 | | | | | | 2,173,843 | | |
Payroll – officers | | | | | 340,000 | | | | | | 0 | | | | | | 0 | | | | | | 340,000 | | | | | | 0 | | | | | | 340,000 | | |
Payroll – other | | | | | 20,587,619 | | | | | | 0 | | | | | | 0 | | | | | | 20,587,619 | | | | | | 0 | | | | | | 20,587,619 | | |
Other operating expenses | | | | | 15,861,878 | | | | | | 128,769 | | | | | | 763 | | | | | | 15,991,410 | | | | | | (4,200,000) | | | | | | 11,791,410 | | |
Less direct costs allocated to inventory and cost of sales | | | | | (21,772,018) | | | | | | 0 | | | | | | 0 | | | | | | (21,772,018) | | | | | | 2,034,215 | | | | | | (19,737,803) | | |
TOTAL OPERATING EXPENSES | | | | | 20,709,698 | | | | | | 2,701,691 | | | | | | 763 | | | | | | 23,412,152 | | | | | | (2,165,785) | | | | | | 21,246,367 | | |
INCOME (LOSS) FROM OPERATIONS | | | | | 59,064,833 | | | | | | (2,701,691) | | | | | | (763) | | | | | | 56,362,379 | | | | | | 4,691,471 | | | | | | 61,053,850 | | |
OTHER INCOME (EXPENSES) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Rental income | | | | | 0 | | | | | | 4,200,000 | | | | | | 0 | | | | | | 4,200,000 | | | | | | (4,200,000) | | | | | | 0 | | |
ATM commissions | | | | | 109,017 | | | | | | 0 | | | | | | 0 | | | | | | 109,017 | | | | | | 0 | | | | | | 109,017 | | |
Interest expense | | | | | (1,402,038) | | | | | | (21,000) | | | | | | 0 | | | | | | (1,423,038) | | | | | | 0 | | | | | | (1,423,038) | | |
Other expense | | | | | 59,339 | | | | | | 0 | | | | | | 0 | | | | | | 59,339 | | | | | | 0 | | | | | | 59,339 | | |
| | | | | (1,233,682) | | | | | | 4,179,000 | | | | | | 0 | | | | | | 2,945,318 | | | | | | (4,200,000) | | | | | | (1,254,682) | | |
NET INCOME (LOSS) | | | | $ | 57,831,151 | | | | | $ | 1,477,309 | | | | | $ | (763) | | | | | $ | 59,307,697 | | | | | $ | 491,471 | | | | | $ | 59,799,168 | | |
| | | POR | | | RVC | | | GPS | | | Total Uncombined | | | Eliminations | | | Combined | | ||||||||||||||||||
ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
CURRENT ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 4,621,570 | | | | | $ | 178,826 | | | | | $ | 185,343 | | | | | $ | 4,985,739 | | | | | $ | 0 | | | | | $ | 4,985,739 | | |
Accounts receivable | | | | | 452,828 | | | | | | 1,920,000 | | | | | | 0 | | | | | | 2,372,828 | | | | | | (1,920,000) | | | | | | 452,828 | | |
Inventory | | | | | 5,744,300 | | | | | | 0 | | | | | | 0 | | | | | | 5,744,300 | | | | | | (491,471) | | | | | | 5,252,829 | | |
Other current assets | | | | | 744,969 | | | | | | 0 | | | | | | 0 | | | | | | 744,969 | | | | | | 0 | | | | | | 744,969 | | |
TOTAL CURRENT ASSETS | | | | | 11,563,667 | | | | | | 2,098,826 | | | | | | 185,343 | | | | | | 13,847,836 | | | | | | (2,411,471) | | | | | | 11,436,365 | | |
PROPERTY AND EQUIPMENT, NET | | | | | 28,025,090 | | | | | | 10,686,278 | | | | | | 0 | | | | | | 38,711,368 | | | | | | 0 | | | | | | 38,711,368 | | |
OTHER ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Deposits | | | | | 491,610 | | | | | | 39,273 | | | | | | 0 | | | | | | 530,883 | | | | | | 0 | | | | | | 530,883 | | |
Due from related parties | | | | | 7,764,555 | | | | | | 4,292,524 | | | | | | 11,054,071 | | | | | | 23,111,150 | | | | | | (23,111,150) | | | | | | 0 | | |
TOTAL OTHER ASSETS | | | | | 8,256,165 | | | | | | 4,331,797 | | | | | | 11,054,071 | | | | | | 23,642,033 | | | | | | (23,111,150) | | | | | | 530,883 | | |
| | | | $ | 47,844,922 | | | | | $ | 17,116,901 | | | | | $ | 11,239,414 | | | | | $ | 76,201,237 | | | | | $ | (25,522,621) | | | | | $ | 50,678,616 | | |
LIABILITIES AND MEMBERS’ EQUITY | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
CURRENT LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts payable and accrued expenses | | | | $ | 7,065,092 | | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 7,065,092 | | | | | $ | (1,440,000) | | | | | $ | 5,625,092 | | |
Current portion of lease liabilities | | | | | 452,597 | | | | | | 0 | | | | | | 0 | | | | | | 452,597 | | | | | | 0 | | | | | | 452,597 | | |
Current portion of long-term debt | | | | | 75,931 | | | | | | 0 | | | | | | 0 | | | | | | 75,931 | | | | | | 0 | | | | | | 75,931 | | |
TOTAL CURRENT LIABILITIES | | | | | 7,593,620 | | | | | | 0 | | | | | | 0 | | | | | | 7,593,620 | | | | | | (1,440,000) | | | | | | 6,153,620 | | |
LONG-TERM LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Lease liabilities | | | | | 8,414,741 | | | | | | 0 | | | | | | 0 | | | | | | 8,414,741 | | | | | | 0 | | | | | | 8,414,741 | | |
Notes payable – related parties | | | | | 480,000 | | | | | | 2,500,000 | | | | | | 0 | | | | | | 2,980,000 | | | | | | (480,000) | | | | | | 2,500,000 | | |
Long-term debt | | | | | 4,600,089 | | | | | | 10,289,058 | | | | | | 0 | | | | | | 14,889,147 | | | | | | (14,581,582) | | | | | | 307,565 | | |
TOTAL LIABILITIES | | | | | 21,088,450 | | | | | | 12,789,058 | | | | | | 0 | | | | | | 33,877,508 | | | | | | (16,501,582) | | | | | | 17,375,926 | | |
MEMBERS’ EQUITY | | | | | 26,756,472 | | | | | | 4,327,843 | | | | | | 11,239,414 | | | | | | 42,323,729 | | | | | | (9,021,039) | | | | | | 33,302,690 | | |
| | | | $ | 47,844,922 | | | | | $ | 17,116,901 | | | | | $ | 11,239,414 | | | | | $ | 76,201,237 | | | | | $ | (25,522,621) | | | | | $ | 50,678,616 | | |
| | | POR | | | RVC | | | GPS | | | Total Uncombined | | | Eliminations | | | Combined | | ||||||||||||||||||
OPERATING INCOME | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sales | | | | $ | 39,371,011 | | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 39,371,011 | | | | | $ | 0 | | | | | $ | 39,371,011 | | |
Cost of sales | | | | | 13,771,446 | | | | | | 0 | | | | | | 0 | | | | | | 13,771,446 | | | | | | (1,789,295) | | | | | | 11,982,151 | | |
GROSS PROFIT | | | | | 25,599,565 | | | | | | 0 | | | | | | 0 | | | | | | 25,599,565 | | | | | | 1,789,295 | | | | | | 27,388,860 | | |
OPERATING EXPENSES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Advertising | | | | | 607,327 | | | | | | 0 | | | | | | 0 | | | | | | 607,327 | | | | | | 0 | | | | | | 607,327 | | |
Amortization | | | | | 343,393 | | | | | | 0 | | | | | | 0 | | | | | | 343,393 | | | | | | 0 | | | | | | 343,393 | | |
Contract labor and consulting | | | | | 246,152 | | | | | | 210,000 | | | | | | 0 | | | | | | 456,152 | | | | | | 0 | | | | | | 456,152 | | |
Depreciation | | | | | 1,372,337 | | | | | | 1,184,928 | | | | | | 0 | | | | | | 2,557,265 | | | | | | 0 | | | | | | 2,557,265 | | |
Insurance | | | | | 922,990 | | | | | | 35,241 | | | | | | 0 | | | | | | 958,231 | | | | | | 0 | | | | | | 958,231 | | |
Payroll | | | | | 8,058,097 | | | | | | 0 | | | | | | 0 | | | | | | 8,058,097 | | | | | | 0 | | | | | | 8,058,097 | | |
Other operating expenses | | | | | 7,813,729 | | | | | | 127,507 | | | | | | 6,000 | | | | | | 7,947,236 | | | | | | (2,040,000) | | | | | | 5,907,236 | | |
Less direct costs allocated to inventory and cost of sales | | | | | (11,828,609) | | | | | | 0 | | | | | | 0 | | | | | | (11,828,609) | | | | | | 2,040,000 | | | | | | (9,788,609) | | |
TOTAL OPERATING EXPENSES | | | | | 7,535,416 | | | | | | 1,557,676 | | | | | | 6,000 | | | | | | 9,099,092 | | | | | | 0 | | | | | | 9,099,092 | | |
INCOME (LOSS) FROM OPERATIONS | | | | | 18,064,149 | | | | | | (1,557,676) | | | | | | (6,000) | | | | | | 16,500,473 | | | | | | 1,789,295 | | | | | | 18,289,768 | | |
OTHER INCOME (EXPENSES) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Rental income | | | | | 0 | | | | | | 2,040,000 | | | | | | 0 | | | | | | 2,040,000 | | | | | | (2,040,000) | | | | | | 0 | | |
ATM commissions | | | | | 35,869 | | | | | | 0 | | | | | | 0 | | | | | | 35,869 | | | | | | 0 | | | | | | 35,869 | | |
Interest expense | | | | | (308,564) | | | | | | (25,500) | | | | | | 0 | | | | | | (334,064) | | | | | | 0 | | | | | | (334,064) | | |
Other expense | | | | | (9,338) | | | | | | 2,160 | | | | | | 0 | | | | | | (7,178) | | | | | | 0 | | | | | | (7,178) | | |
| | | | | (282,033) | | | | | | 2,016,660 | | | | | | 0 | | | | | | 1,734,627 | | | | | | (2,040,000) | | | | | | (305,373) | | |
NET INCOME (LOSS) | | | | $ | 17,782,116 | | | | | $ | 458,984 | | | | | $ | (6,000) | | | | | $ | 18,235,100 | | | | | $ | (250,705) | | | | | $ | 17,984,395 | | |
| | | PAGE | | |||
| | | | | | ||
Financial Statements: | | | | | | | |
| | | | | | ||
| | | | | | ||
| | | | | | ||
| | | | | | ||
| | | | | | ||
Consolidating Supplementary Information: | | | | | | | |
| | | | | | ||
| | | | | |
| ASSETS | | | | | | | |
| CURRENT ASSETS | | | | | | | |
| Cash and cash equivalents | | | | $ | 957,389 | | |
| Accounts receivable, net | | | | | 285,062 | | |
| Notes receivable | | | | | 263,896 | | |
| Inventories | | | | | 3,549,557 | | |
| Other current assets | | | | | 221,109 | | |
| TOTAL CURRENT ASSETS | | | | | 5,277,013 | | |
| PROPERTY AND EQUIPMENT, NET | | | | | 12,480,460 | | |
| OTHER ASSETS | | | | | | | |
| Intangible assets, net | | | | | 4,564,588 | | |
| Investments in related companies, net | | | | | 41,862,377 | | |
| Security deposits | | | | | 41,353 | | |
| TOTAL OTHER ASSETS | | | | | 46,468,318 | | |
| | | | | $ | 64,225,791 | | |
| LIABILITIES AND MEMBERS’ EQUITY | | | | | | | |
| CURRENT LIABILITIES | | | | | | | |
| Accounts payable | | | | $ | 458,001 | | |
| Accrued expenses and other liabilities | | | | | 822,502 | | |
| Current portion of lease liabilities | | | | | 133,458 | | |
| Current portion of long-term debt | | | | | 1,468,063 | | |
| Income tax payable | | | | | 210,000 | | |
| TOTAL CURRENT LIABILITIES | | | | | 3,092,024 | | |
| LONG-TERM LIABILITIES | | | | | | | |
| Lease liabilities, net of current portion | | | | | 54,536 | | |
| Long-term debt, net of current portion | | | | | 1,083,741 | | |
| TOTAL LIABILITIES | | | | | 4,230,301 | | |
| MEMBERS’ EQUITY | | | | | 59,995,490 | | |
| | | | | $ | 64,225,791 | | |
| OPERATING INCOME | | | | | | | |
| Sales | | | | $ | 20,648,304 | | |
| Cost of sales | | | | | 9,803,515 | | |
| GROSS PROFIT | | | | | 10,844,789 | | |
| OPERATING EXPENSES | | | | | | | |
| General and administrative expenses | | | | | 4,543,847 | | |
| Amortization | | | | | 627,897 | | |
| Depreciation | | | | | 751,150 | | |
| TOTAL OPERATING EXPENSES | | | | | 5,922,894 | | |
| INCOME FROM OPERATIONS | | | | | 4,921,895 | | |
| OTHER INCOME (EXPENSES) | | | | | | | |
| Income from investments in related companies | | | | | 24,517,659 | | |
| Income from sale of investment | | | | | 885,678 | | |
| Interest expense | | | | | (175,445) | | |
| Loss on sale of property and equipment | | | | | (415,575) | | |
| Other income | | | | | 3,674 | | |
| | | | | | 24,815,991 | | |
| INCOME BEFORE PROVISION FOR INCOME TAXES | | | | | 29,737,886 | | |
| PROVISION FOR INCOME TAXES | | | | | 210,000 | | |
| NET INCOME | | | | $ | 29,527,886 | | |
| Balance at December 31, 2019 | | | | $ | 37,959,108 | | |
| Contribution from members | | | | | 1,000,000 | | |
| Distributions to members | | | | | (8,491,504) | | |
| Net income | | | | | 29,527,886 | | |
| Balance at December 31, 2020 | | | | $ | 59,995,490 | | |
| RECONCILIATION OF NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | | | |
| Net income | | | | $ | 29,527,886 | | |
| Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | |
| Depreciation | | | | | 751,150 | | |
| Amortization | | | | | 627,897 | | |
| Income from investment in related companies | | | | | (24,517,659) | | |
| Loss on sale of property and equipment | | | | | 415,575 | | |
| Changes in assets and liabilities: | | | | | | | |
| Decrease in accounts and notes receivable | | | | | 932,802 | | |
| Increase in inventories | | | | | (1,164,131) | | |
| Decrease in prepaid expenses | | | | | 81,128 | | |
| Increase in security deposits | | | | | (1,199) | | |
| Decrease in accounts payable | | | | | (122,193) | | |
| Increase in accrued expenses and other liabilities | | | | | 446,791 | | |
| Increase in income taxes payable | | | | | 210,000 | | |
| NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 7,188,047 | | |
| CASH FLOWS FROM INVESTING ACTIVITIES | | | | | | | |
| Distributions received from investments in related companies | | | | | 6,559,997 | | |
| Purchase of property and equipment | | | | | (5,180,287) | | |
| Proceeds from sale of property and equipment | | | | | 125,323 | | |
| NET CASH PROVIDED BY INVESTING ACTIVITIES | | | | | 1,505,033 | | |
| CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | | |
| Payments on lease liabilities | | | | | (601,401) | | |
| Payments on long-term debt | | | | | (1,578,196) | | |
| Contributions from members | | | | | 1,000,000 | | |
| Distributions to members | | | | | (8,491,504) | | |
| NET CASH USED IN FINANCING ACTIVITIES | | | | | (9,671,101) | | |
| NET DECREASE IN CASH AND CASH EQUIVALENTS | | | | | (978,021) | | |
| CASH AND CASH EQUIVALENTS | | | | | | | |
| Beginning of year | | | | | 1,935,410 | | |
| End of year | | | | $ | 957,389 | | |
| SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION | | | | | | | |
| Cash paid during the year for: | | | | | | | |
| Interest | | | | $ | 175,445 | | |
| Acquisitions of property and equipment through debt | | | | $ | 3,130,000 | | |
| | | YEARS | |
Buildings | | | 39 | |
Leasehold improvements | | | 5 – 39 | |
Machinery and equipment | | | 5 – 15 | |
Furniture and fixtures | | | 5 – 7 | |
Lab equipment | | | 3 – 5 | |
Computer equipment | | | 5 | |
Vehicles | | | 5 | |
| | | 2020 | | |||
Raw materials | | | | $ | 276,813 | | |
Work-in-process | | | | | 1,689,701 | | |
Finished goods | | | | | 1,583,043 | | |
TOTALS | | | | $ | 3,549,557 | | |
| | | 2020 | | |||
Prepaid expenses | | | | $ | 221,049 | | |
Other current assets | | | | | 60 | | |
TOTALS | | | | $ | 221,109 | | |
| | | 2020 | | |||
Buildings and improvements | | | | $ | 8,203,253 | | |
Furniture and equipment | | | | | 2,242,582 | | |
Vehicles | | | | | 218,827 | | |
Construction in progress | | | | | 2,292,432 | | |
Land and improvements | | | | | 1,020,000 | | |
| | | | | 14,774,043 | | |
Accumulated depreciation | | | | | (2,293,583) | | |
Net property and equipment | | | | $ | 12,480,460 | | |
| | | 2020 | | |||
Balance, beginning of year | | | | $ | 23,904,715 | | |
Distributions during the year | | | | | (6,559,997) | | |
Share in current year net income | | | | | 24,517,659 | | |
Balance, end of year | | | | $ | 41,862,377 | | |
| | | 2020 | | |||
Total Assets | | | | $ | 103,893,322 | | |
Total Liabilities | | | | $ | 53,947,064 | | |
Total Equity | | | | | 49,946,258 | | |
| | | | $ | 103,893,322 | | |
Total Income | | | | $ | 105,769,587 | | |
Total Expenses | | | | | 45,970,419 | | |
Net Income | | | | $ | 59,799,168 | | |
| | | 2020 | | |||
Accounts payable | | | | $ | 458,001 | | |
Related party payable | | | | | 24,673 | | |
Sales tax payable | | | | | 100,395 | | |
Accrued expenses | | | | | 697,434 | | |
TOTALS | | | | $ | 1,280,503 | | |
| | | 2020 | | |||
Mortgage to Pioneer Title Agency, monthly payments totaling $31,661 including interest rate of 6%, maturing through March 2023. | | | | $ | 770,554 | | |
Note payable to Fidelity National Title, monthly payments totaling $112,318 including interest rate of 10%, maturing through July 2022. | | | | | 1,781,250 | | |
| | | | | 2,551,804 | | |
Less current portion | | | | | 1,468,063 | | |
TOTAL LONG TERM-DEBT | | | | $ | 1,083,741 | | |
| 2021 | | | | $ | 1,468,063 | | |
| 2022 | | | | | 1,018,659 | | |
| 2023 | | | | | 65,082 | | |
| TOTAL | | | | $ | 2,551,804 | | |
| 2021 | | | | $ | 151,069 | | |
| 2022 | | | | | 56,000 | | |
| Total undiscounted lease liabilities | | | | | 207,069 | | |
| Interest on lease liabilities | | | | | (19,073) | | |
| Total present value of minimum lease payments | | | | | 187,996 | | |
| Lease liabilities – current portion | | | | | 133,458 | | |
| Lease liabilities – noncurrent | | | | $ | 54,536 | | |
| | | 2020 | | |||
Balance, beginning of year | | | | $ | 789,395 | | |
Additions (Deletions) | | | | | (241,580) | | |
Lease and interest payments, accretion, and accrued interest, net | | | | | (359,821) | | |
Balance, end of year | | | | | 187,994 | | |
Lease liability – current portion | | | | | 133,458 | | |
Lease liability – noncurrent portion | | | | $ | 54,536 | | |
| | | Alternative Medical Enterprises, LLC | | | Agronomy Holdings, LLC | | | Agronomy Innovations, LLC | | | AltMed, LLC | | | Cave Creek RE, LLC | | | Fort Consulting, LLC | | | MuV Health LLC | | | NuTrae, LLC | | | Elimination | | | Total | | ||||||||||||||||||||||||||||||
CURRENT ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 0 | | | | | $ | 7,746 | | | | | $ | 281,449 | | | | | $ | 0 | | | | | $ | 9,867 | | | | | $ | 646,213 | | | | | $ | 6,310 | | | | | $ | 5,804 | | | | | $ | 0 | | | | | $ | 957,389 | | |
Accounts receivable, net | | | | | 0 | | | | | | 0 | | | | | | 60,000 | | | | | | 0 | | | | | | 0 | | | | | | 225,143 | | | | | | (21) | | | | | | (60) | | | | | | 0 | | | | | | 285,062 | | |
Notes receivable | | | | | 163,896 | | | | | | 100,000 | | | | | | 16,745,052 | | | | | | 0 | | | | | | (2,684,088) | | | | | | 0 | | | | | | 0 | | | | | | (3,370) | | | | | | (14,057,594) | | | | | | 263,896 | | |
Inventories | | | | | 0 | | | | | | 0 | | | | | | 276,812 | | | | | | 0 | | | | | | 0 | | | | | | 3,040,265 | | | | | | 232,480 | | | | | | 0 | | | | | | 0 | | | | | | 3,549,557 | | |
Other current assets | | | | | 122,384 | | | | | | 0 | | | | | | 195,353 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 60 | | | | | | 0 | | | | | | (96,688) | | | | | | 221,109 | | |
TOTAL CURRENT ASSETS | | | | | 286,280 | | | | | | 107,746 | | | | | | 17,558,666 | | | | | | 0 | | | | | | (2,674,221) | | | | | | 3,911,621 | | | | | | 238,829 | | | | | | 2,374 | | | | | | (14,154,282) | | | | | | 5,277,013 | | |
PROPERTY AND EQUIPMENT, NET | | | | | 67,708 | | | | | | 0 | | | | | | 7,302,149 | | | | | | 46,067 | | | | | | 5,064,536 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 12,480,460 | | |
OTHER ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Intangible and investments in related companies, net | | | | | 39,686,508 | | | | | | 21,540,258 | | | | | | 4,564,588 | | | | | | 41,862,377 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | (61,226,766) | | | | | | 46,426,965 | | |
Security deposits | | | | | 0 | | | | | | 0 | | | | | | 34,753 | | | | | | 6,400 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 200 | | | | | | 0 | | | | | | 41,353 | | |
TOTAL OTHER ASSETS | | | | | 39,686,508 | | | | | | 21,540,258 | | | | | | 4,599,341 | | | | | | 41,868,777 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 200 | | | | | | (61,226,766) | | | | | | 46,468,318 | | |
| | | | $ | 40,040,496 | | | | | $ | 21,648,004 | | | | | $ | 29,460,156 | | | | | $ | 41,914,844 | | | | | $ | 2,390,315 | | | | | $ | 3,911,621 | | | | | $ | 238,829 | | | | | $ | 2,574 | | | | | $ | (75,381,048) | | | | | $ | 64,225,791 | | |
| | | Alternative Medical Enterprises, LLC | | | Agronomy Holdings, LLC | | | Agronomy Innovations, LLC | | | AltMed, LLC | | | Cave Creek RE, LLC | | | Fort Consulting, LLC | | | MuV Health LLC | | | NuTrae, LLC | | | Elimination | | | Total | | ||||||||||||||||||||||||||||||
CURRENT LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts payable | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 231,724 | | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 225,197 | | | | | $ | 1,080 | | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 458,001 | | |
Accrued expenses | | | | | 9,883,741 | | | | | | 0 | | | | | | 9,829,788 | | | | | | (6,760,886) | | | | | | 0 | | | | | | 5,548,835 | | | | | | 933,643 | | | | | | (2,758,547) | | | | | | (15,854,073) | | | | | | 822,501 | | |
Current portion of capital lease liabilities | | | | | 0 | | | | | | 0 | | | | | | 84,378 | | | | | | 49,080 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 133,458 | | |
Current portion of long-term debt | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 1,468,063 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 1,468,063 | | |
Income tax payable | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 210,000 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 210,000 | | |
TOTAL CURRENT LIABILITIES | | | | | 9,883,741 | | | | | | 0 | | | | | | 10,145,890 | | | | | | (6,711,806) | | | | | | 1,468,063 | | | | | | 5,984,032 | | | | | | 934,723 | | | | | | (2,758,547) | | | | | | (15,854,073) | | | | | | 3,092,023 | | |
LONG-TERM LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Lease liabilities, net of current portion | | | | | 0 | | | | | | 0 | | | | | | 54,536 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 54,536 | | |
Long-term debt, net of current portion | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 1,083,741 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 1,083,741 | | |
TOTAL LONG-TERM LIABILITIES | | | | | 0 | | | | | | 0 | | | | | | 54,536 | | | | | | 0 | | | | | | 1,083,741 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 1,138,277 | | |
TOTAL LIABILITIES | | | | | 9,883,741 | | | | | | 0 | | | | | | 10,200,426 | | | | | | (6,711,806) | | | | | | 2,551,804 | | | | | | 5,984,032 | | | | | | 934,723 | | | | | | (2,758,547) | | | | | | (15,854,073) | | | | | | 4,230,300 | | |
MEMBERS’ EQUITY (DEFICIT) | | | | | 30,156,755 | | | | | | 21,648,004 | | | | | | 19,259,730 | | | | | | 48,626,650 | | | | | | (161,489) | | | | | | (2,072,411) | | | | | | (695,894) | | | | | | 2,761,121 | | | | | | (59,526,975) | | | | | | 59,995,491 | | |
| | | | $ | 40,040,496 | | | | | $ | 21,648,004 | | | | | $ | 29,460,156 | | | | | $ | 41,914,844 | | | | | $ | 2,390,315 | | | | | $ | 3,911,621 | | | | | $ | 238,829 | | | | | $ | 2,574 | | | | | $ | (75,381,048) | | | | | $ | 64,225,791 | | |
| | | Alternative Medical Enterprises, LLC | | | Agronomy Holdings, LLC | | | Agronomy Innovations, LLC | | | AltMed, LLC | | | Cave Creek RE, LLC | | | Fort Consulting, LLC | | | MuV Health LLC | | | NuTrae, LLC | | | Elimination | | | Total | | ||||||||||||||||||||||||||||||
OPERATING INCOME | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Sales | | | | $ | 0 | | | | | $ | 3,566 | | | | | $ | 15,552,777 | | | | | $ | 0 | | | | | $ | 0 | | | | | $ | 20,591,054 | | | | | $ | 41,184 | | | | | $ | 732,004 | | | | | $ | (16,272,281) | | | | | $ | 20,648,304 | | |
Cost of sales | | | | | 0 | | | | | | 0 | | | | | | 6,060,393 | | | | | | 0 | | | | | | 0 | | | | | | 17,347,340 | | | | | | 17,401 | | | | | | (44) | | | | | | (13,621,575) | | | | | | 9,803,515 | | |
GROSS PROFIT | | | | | 0 | | | | | | 3,566 | | | | | | 9,492,384 | | | | | | 0 | | | | | | 0 | | | | | | 3,243,714 | | | | | | 23,783 | | | | | | 732,048 | | | | | | (2,650,706) | | | | | | 10,844,789 | | |
OPERATING EXPENSES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
General and administrative expenses | | | | | 1,231,457 | | | | | | 5,834 | | | | | | 2,800,805 | | | | | | (350) | | | | | | (41,112) | | | | | | 2,662,660 | | | | | | 498,174 | | | | | | 44,990 | | | | | | (2,658,611) | | | | | | 4,543,847 | | |
Amortization | | | | | 0 | | | | | | 0 | | | | | | 542,252 | | | | | | 85,645 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 627,897 | | |
Depreciation | | | | | 5,855 | | | | | | 0 | | | | | | 560,351 | | | | | | 125,527 | | | | | | 59,417 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 751,150 | | |
TOTAL OPERATING EXPENSES | | | | | 1,237,312 | | | | | | 5,834 | | | | | | 3,903,408 | | | | | | 210,822 | | | | | | 18,305 | | | | | | 2,662,660 | | | | | | 498,174 | | | | | | 44,990 | | | | | | (2,658,611) | | | | | | 5,922,894 | | |
INCOME (LOSS) FROM OPERATIONS | | | | | (1,237,312) | | | | | | (2,268) | | | | | | 5,588,976 | | | | | | (210,822) | | | | | | (18,305) | | | | | | 581,054 | | | | | | (474,391) | | | | | | 687,058 | | | | | | 7,905 | | | | | | 4,921,895 | | |
OTHER INCOME (EXPENSE) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Income from investments in related companies | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 24,517,659 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 24,517,659 | | |
Income from the sale of investment | | | | | 0 | | | | | | 885,678 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 885,678 | | |
Interest income (expense) | | | | | 3,871 | | | | | | 15 | | | | | | (26,854) | | | | | | (9,279) | | | | | | (143,183) | | | | | | 0 | | | | | | (15) | | | | | | 0 | | | | | | 0 | | | | | | (175,445) | | |
Gain (loss) on sale of property and equipment | | | | | 0 | | | | | | 0 | | | | | | 94,918 | | | | | | (510,493) | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | (415,575) | | |
Other income (expense) | | | | | (109,425) | | | | | | 0 | | | | | | (127) | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 113,226 | | | | | | 0 | | | | | | 3,674 | | |
| | | | | (105,554) | | | | | | 885,693 | | | | | | 67,937 | | | | | | 23,997,887 | | | | | | (143,183) | | | | | | 0 | | | | | | (15) | | | | | | 113,226 | | | | | | 0 | | | | | | 24,815,991 | | |
INCOME BEFORE PROVISION FOR INCOME TAXES | | | | | (1,342,866) | | | | | | 883,425 | | | | | | 5,656,913 | | | | | | 23,787,065 | | | | | | (161,488) | | | | | | 581,054 | | | | | | (474,406) | | | | | | 800,284 | | | | | | 7,905 | | | | | | 29,737,886 | | |
PROVISION FOR INCOME TAXES | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 210,000 | | | | | | 0 | | | | | | 0 | | | | | | 0 | | | | | | 210,000 | | |
NET INCOME (LOSS) | | | | $ | (1,342,866) | | | | | $ | 883,425 | | | | | $ | 5,656,913 | | | | | $ | 23,787,065 | | | | | $ | (161,488) | | | | | $ | 371,054 | | | | | $ | (474,406) | | | | | $ | 800,284 | | | | | $ | 7,905 | | | | | $ | 29,527,886 | | |
| | | Pages | |
INDEPENDENT AUDITOR’S REPORT ON THE FINANCIAL STATEMENTS | | | | |
FINANCIAL STATEMENTS | | | | |
Consolidated Balance Sheet | | | | |
Consolidated Statement of Operations | | | | |
Consolidated Statement of Members’ Equity | | | | |
Consolidated Statement of Cash Flows | | | | |
Notes to Consolidated Financial Statements | | | | |
INDEPENDENT AUDITOR’S REPORT ON THE CONSOLIDATED SUPPLEMENTARY INFORMATION | | | I-140 | |
Consolidated Schedule of General and Administrative Expenses | | | I-141 | |
Consolidating Balance Sheet | | | I-142 | |
Consolidating Statement of Operations | | | I-143 | |
| | | South Phoenix 4653 E Cotton Gin Loop, Suite 120 Phoenix, AZ 85040 – – – It’s about time. | |
| /s/ Atlas CPAs & Advisors PLLC ATLAS CPAs & Advisors PLLC Phoenix, Arizona July 6, 2020 | | | | |
| | | O: 602.431.9288 F: 602.431.9299 | |
| ASSETS | | | | | | | |
| CURRENT ASSETS | | | | | | | |
| Cash and cash equivalents | | | | $ | 1,935,410 | | |
| Accounts receivable | | | | | 403,542 | | |
| Notes receivable | | | | | 1,078,217 | | |
| Inventories | | | | | 2,385,426 | | |
| Prepaid expenses | | | | | 302,237 | | |
| TOTAL CURRENT ASSETS | | | | | 6,104,832 | | |
| LONG-TERM ASSETS | | | | | | | |
| Property and equipment, net | | | | | 4,938,004 | | |
| Intangible assets, net | | | | | 5,195,408 | | |
| Investments, net | | | | | 23,904,715 | | |
| Security deposits | | | | | 40,154 | | |
| TOTAL LONG-TERM ASSETS | | | | | 34,078,281 | | |
| TOTAL ASSETS | | | | $ | 40,183,113 | | |
| LIABILITIES AND MEMBERS’ EQUITY | | | | | | | |
| CURRENT LIABILITIES | | | | | | | |
| Accounts payable | | | | $ | 580,194 | | |
| Accrued expenses and other liabilities | | | | | 375,711 | | |
| Notes payable | | | | | 1,000,000 | | |
| Current portion of capital leases | | | | | 22,020 | | |
| TOTAL CURRENT LIABILITIES | | | | | 1,977,925 | | |
| LONG-TERM PORTION OF CAPITAL LEASES | | | | | 11,896 | | |
| TOTAL LIABILITIES | | | | | 1,989,821 | | |
| MEMBERS’ EQUITY | | | | | 38,193,292 | | |
| TOTAL LIABILITIES AND MEMBERS’ EQUITY | | | | $ | 40,183,113 | | |
| | | Amount | | | Percent | | ||||||
Net Revenues | | | | $ | 14,482,050 | | | | | | 100.0% | | |
Cost of Revenues | | | | | 8,620,878 | | | | | | 59.5 | | |
Gross Profit | | | | | 5,861,172 | | | | | | 40.5 | | |
General and administrative expense | | | | | 4,808,041 | | | | | | 33.2 | | |
Amortization | | | | | 1,300,447 | | | | | | 9.0 | | |
Depreciation | | | | | 445,177 | | | | | | 3.1 | | |
| | | | | 6,553,665 | | | | | | 45.3 | | |
Loss from Operations | | | | | (692,493) | | | | | | (4.8) | | |
Other Income (Expense) Income from investee | | | | | 8,036,184 | | | | | | 55.5 | | |
Interest expense | | | | | (3,871) | | | | | | (0.0) | | |
Loss on sale of property and equipment | | | | | (25,077) | | | | | | (0.2) | | |
Interest income | | | | | 1,218 | | | | | | 0.0 | | |
Total Other Income | | | | | 8,008,454 | | | | | | 55.3 | | |
Net income | | | | $ | 7,315,961 | | | | | | 50.5% | | |
| Balances at December 31, 2018 | | | | $ | 32,127,331 | | |
| Repurchase of member’s interest | | | | | (1,250,000) | | |
| Net income | | | | | 7,315,961 | | |
| Balances at December 31, 2019 | | | | $ | 38,193,292 | | |
| CASH FLOWS FROM OPERATING ACTIVITIES | | | | | | | |
| Net income | | | | $ | 7,315,961 | | |
| Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | |
| Depreciation expense | | | | | 445,177 | | |
| Amortization expense | | | | | 1,300,447 | | |
| Income from investee | | | | | (8,036,184) | | |
| Loss on sale of property and equipment | | | | | 25,077 | | |
| Effects of changes in operating assets and liabilities: | | | | | | | |
| (Increase) decrease in operating assets | | | | | | | |
| Accounts receivable | | | | | (259,788) | | |
| Prepaid expenses | | | | | 62,574 | | |
| Inventories | | | | | (317,509) | | |
| Increase (decrease) in operating liabilities | | | | | | | |
| Accounts payable | | | | | 383,619 | | |
| Accrued expenses and other liabilities | | | | | 109,610 | | |
| Deferred revenue | | | | | (490,278) | | |
| Net cash provided by operating activities | | | | | 538,706 | | |
| CASH FLOWS FROM INVESTING ACTIVITIES | | | | | | | |
| Distributions received from investments | | | | | 287,000 | | |
| Purchase of property and equipment | | | | | (513,031) | | |
| Proceeds from sale of property and equipment | | | | | 17,500 | | |
| Net cash used in investing activities | | | | | (208,531) | | |
| CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | | |
| Payment on capital leases | | | | | (30,013) | | |
| Repurchase of member’s interest | | | | | (250,000) | | |
| Net cash used in financing activities | | | | | (280,013) | | |
| Net change in cash | | | | | 50,162 | | |
| Cash and cash equivalents – beginning of period | | | | | 1,885,248 | | |
| Cash and cash equivalents – end of period | | | | $ | 1,935,410 | | |
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | |
| Issuance of debt to repurchase member’s interest | | | | $ | 1,000,000 | | |
| Interest paid | | | | $ | 3,871 | | |
| Raw materials | | | | $ | 611,666 | | |
| Work-in-progress | | | | | 1,021,507 | | |
| Finished goods | | | | | 752,253 | | |
| | | | | $ | 2,385,426 | | |
| Buildings and improvements | | | $ | 4,268,411 | | | Buildings and improvements | | | $ | 4,268,411 | | | ||
| Furniture and equipments | | | | 1,482,743 | | | Furniture and equipments | | | | 1,482,743 | | | ||
| Vehicles | | | | 191,064 | | | Vehicles | | | | 191,064 | | | ||
| Construction in progress | | | | 180,131 | | | Construction in progress | | | | 180,131 | | | ||
| Land and improvements | | | | 78,040 | | | Land and improvements | | | | 78,040 | | | ||
| | | | | 6,200,389 | | | | | | | 6,200,389 | | | ||
| Less: accumulated depreciation | | | | (1,262,385) | | | Less: accumulated depreciation | | �� | | (1,262,385) | | | ||
| Total property, plant and equipment | | | $ | 4,938,004 | | | Total property, plant and equipment | | | $ | 4,938,004 | | |
| Balance, beginning of year | | | | $ | 863,703 | | |
| Current year income | | | | | 50,619 | | |
| Balance, end of year | | | | $ | 914,322 | | |
| Total Assets | | | | $ | 6,020,085 | | |
| Total Liabilities | | | | $ | 1,053,799 | | |
| Total Equity | | | | | 4,966,286 | | |
| | | | | $ | 6,020,085 | | |
| Total Income | | | | $ | 506,190 | | |
| Total Expenses | | | | | 2,313,987 | | |
| Net Loss | | | | $ | (1,807,797) | | |
| Balance, beginning of year | | | | $ | 16,206,150 | | |
| Distributions during the year | | | | | (287,000) | | |
| Share in current year net income | | | | | 7,985,565 | | |
| Balance, end of year | | | | $ | 23,904,715 | | |
| Total Assets | | | | $ | 42,483,242 | | |
| Total Liabilities | | | | $ | 8,508,588 | | |
| Total Equity | | | | | 33,974,654 | | |
| | | | | $ | 42,483,242 | | |
| Total Income | | | | $ | 28,113,124 | | |
| Total Expenses | | | | | 9,500,453 | | |
| Net Income | | | | $ | 18,612,671 | | |
Years Ending December 31, | | | | | | | |
2020 | | | | $ | 285,879 | | |
2021 | | | | | 70,360 | | |
| | | | | 356,239 | | |
Less: Current portion | | | | | (285,879) | | |
Total long-term obligations | | | | $ | 70,360 | | |
Years Ending December 31, | | | | | | | |
2020 | | | | $ | 22,020 | | |
2021 | | | | | 11,896 | | |
| | | | | 33,916 | | |
Less: Current portion | | | | | (22,020) | | |
Total Capital Lease Obligations | | | | $ | 11,896 | | |
| | | South Phoenix 4653 E Cotton Gin Loop, Suite 120 Phoenix, AZ 85040 - - - - It’s about time. | |
| /s/ Atlas CPAs & Advisors PLLC ATLAS CPAs & Advisors PLLC Phoenix, Arizona July 6, 2020 | | | | |
| | | O: 602.431.9288 F: 602.431.9299 | |
| | | Amount | | | Percent | | ||||||
REVENUE | | | | $ | 14,482,050 | | | | | | 100.0% | | |
Payroll expense | | | | | 1,303,647 | | | | | | 9.0 | | |
Professional fees | | | | | 1,344,261 | | | | | | 9.3 | | |
Office expense | | | | | 152,224 | | | | | | 1.1 | | |
Rent expense | | | | | 504,336 | | | | | | 3.5 | | |
Utilities | | | | | 439,816 | | | | | | 3.0 | | |
Advertising | | | | | 202,891 | | | | | | 1.4 | | |
Repairs and maintenance | | | | | 193,982 | | | | | | 1.3 | | |
Insurance expense | | | | | 169,426 | | | | | | 1.2 | | |
Travel expense | | | | | 132,928 | | | | | | 0.9 | | |
Bank service charges | | | | | 104,152 | | | | | | 0.7 | | |
License and fees | | | | | 81,537 | | | | | | 0.6 | | |
Telecommunication and internet | | | | | 66,713 | | | | | | 0.5 | | |
Bad debt | | | | | 37,858 | | | | | | 0.3 | | |
Supplies | | | | | 34,867 | | | | | | 0.2 | | |
Meals and entertainment | | | | | 14,417 | | | | | | 0.1 | | |
Automobile expense | | | | | 13,000 | | | | | | 0.1 | | |
Dues and subscriptions | | | | | 9,786 | | | | | | 0.1 | | |
Cash donations | | | | | 2,200 | | | | | | 0.0 | | |
TOTAL GENERAL AND ADMINISTRATIVE EXPENSES | | | | $ | 4,808,041 | | | | | | 33.2% | | |
| | | ASSETS | | |||||||||||||||||||||||||||||||||||||||||||||||||||
| | | Alternative Medical Enterprises, LLC | | | Agronomy Holdings, LLC | | | Agronomy Innovations, LLC | | | AltMed, LLC | | | Fort Consulting LLC | | | MuV Health LLC | | | NuTrae, LLC | | | Elimination | | | Total | | |||||||||||||||||||||||||||
CURRENT ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 5,495 | | | | | $ | 9,792 | | | | | $ | 921,491 | | | | | $ | 10,577 | | | | | $ | 943,628 | | | | | $ | 26,203 | | | | | $ | 18,224 | | | | | $ | — | | | | | $ | 1,935,410 | | |
Accounts receivable | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 400,040 | | | | | | — | | | | | | 3,502 | | | | | | — | | | | | | 403,542 | | |
Notes receivable | | | | | 163,895 | | | | | | 914,322 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,078,217 | | |
Inventories | | | | | — | | | | | | — | | | | | | 382,206 | | | | | | — | | | | | | 1,773,760 | | | | | | 229,460 | | | | | | — | | | | | | — | | | | | | 2,385,426 | | |
Due from, related party | | | | | 84,593 | | | | | | — | | | | | | 6,609,549 | | | | | | 287,000 | | | | | | 33,110 | | | | | | 10,000 | | | | | | 2,050,270 | | | | | | (9,074,522) | | | | | | — | | |
Prepaid expenses | | | | | 117,886 | | | | | | — | | | | | | 184,351 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 302,237 | | |
TOTAL CURRENT ASSETS | | | | | 371,869 | | | | | | 924,114 | | | | | | 8,097,597 | | | | | | 297,577 | | | | | | 3,150,538 | | | | | | 265,663 | | | | | | 2,071,996 | | | | | | (9,074,522) | | | | | | 6,104,832 | | |
LONG-TERM ASSETS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Property and equipment, net | | | | | 82,390 | | | | | | — | | | | | | 4,312,942 | | | | | | 542,672 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 4,938,004 | | |
Intangible assets, net | | | | | — | | | | | | — | | | | | | 5,106,838 | | | | | | 88,570 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5,195,408 | | |
Investments, net | | | | | 39,686,509 | | | | | | 19,840,466 | | | | | | — | | | | | | 23,904,715 | | | | | | — | | | | | | — | | | | | | — | | | | | | (59,526,975) | | | | | | 23,904,715 | | |
Security deposits | | | | | — | | | | | | — | | | | | | 33,554 | | | | | | 6,400 | | | | | | — | | | | | | — | | | | | | 200 | | | | | | — | | | | | | 40,154 | | |
TOTAL LONG-TERM ASSETS | | | | | 39,768,899 | | | | | | 19,840,466 | | | | | | 9,453,334 | | | | | | 24,542,357 | | | | | | — | | | | | | — | | | | | | 200 | | | | | | (59,526,975) | | | | | | 34,078,281 | | |
TOTAL ASSETS | | | | $ | 40,140,768 | | | | | | 20,764,580 | | | | | $ | 17,550,931 | | | | | $ | 24,839,934 | | | | | $ | 3,150,538 | | | | | $ | 265,663 | | | | | $ | 2,072,196 | | | | | $ | (68,601,497) | | | | | $ | 40,183,113 | | |
| | | LIABILITIES AND MEMBERS’ EQUITY | | |||||||||||||||||||||||||||||||||||||||||||||||||||
| | | Alternative Medical Enterprises, LLC | | | Agronomy Holdings, LLC | | | Agronomy Innovations, LLC | | | AltMed, LLC | | | Fort Consulting, LLC | | | MuV Health LLC | | | NuTrae, LLC | | | Elimination | | | Total | | |||||||||||||||||||||||||||
CURRENT LIABILITIES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts payable | | | | $ | 19,159 | | | | | $ | — | | | | | $ | 75,504 | | | | | $ | 350 | | | | | $ | 404,187 | | | | | $ | 65,250 | | | | | $ | 15,744 | | | | | $ | — | | | | | $ | 580,194 | | |
Accrued expenses and other liabilities | | | | | 6,817 | | | | | | — | | | | | | 287,229 | | | | | | — | | | | | | 80,645 | | | | | | — | | | | | | 1,020 | | | | | | — | | | | | | 375,711 | | |
Due to related parties | | | | | 1,111,585 | | | | | | — | | | | | | 2,337,270 | | | | | | — | | | | | | 5,109,174 | | | | | | 421,900 | | | | | | 94,593 | | | | | | (9,074,522) | | | | | | — | | |
Notes payable | | | | | — | | | | | | — | | | | | | 1,000,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,000,000 | | |
Current portion of capital leases | | | | | — | | | | | | — | | | | | | 22,020 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 22,020 | | |
TOTAL CURRENT LIABILITIES | | | | | 1,137,561 | | | | | | — | | | | | | 3,722,023 | | | | | | 350 | | | | | | 5,594,006 | | | | | | 487,150 | | | | | | 111,357 | | | | | | (9,074,522) | | | | | | 1,977,925 | | |
LONG-TERM PORTION OF CAPITAL LEASES | | | | | — | | | | | | — | | | | | | 11,896 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 11,896 | | |
TOTAL LIABILITIES | | | | | 1,137,561 | | | | | | — | | | | | | 3,733,919 | | | | | | 350 | | | | | | 5,594,006 | | | | | | 487,150 | | | | | | 111,357 | | | | | | (9,074,522) | | | | | | 1,989,821 | | |
MEMBERS’ EQUITY | | | | | 39,003,207 | | | | | | 20,764,580 | | | | | | 13,817,012 | | | | | | 24,839,584 | | | | | | (2,443,468) | | | | | | (221,487) | | | | | | 1,960,839 | | | | | | (59,526,975) | | | | | | 38,193,292 | | |
TOTAL LIABILITIES AND MEMBERS’ EQUITY | | | | $ | 40,140,768 | | | | | $ | 20,764,580 | | | | | $ | 17,550,931 | | | | | $ | 24,839,934 | | | | | $ | 3,150,538 | | | | | $ | 265,663 | | | | | $ | 2,072,196 | | | | | $ | (68,601,497) | | | | | $ | 40,183,113 | | |
| | | Alternative Medical Enterprises, LLC | | | Agronomy Holdings, LLC | | | Agronomy Innovations, LLC | | | AltMed, LLC | | | Fort Consulting, LLC | | | MuV Health LLC | | | NuTrae, LLC | | | Elimination | | | Total | | |||||||||||||||||||||||||||
Net Revenues | | | | $ | — | | | | | $ | — | | | | | $ | 9,998,619 | | | | | $ | — | | | | | $ | 13,981,195 | | | | | $ | — | | | | | $ | 1,068,591 | | | | | $ | (10,566,355) | | | | | $ | 14,482,050 | | |
Cost of Revenues | | | | | 16,033 | | | | | | — | | | | | | 3,812,555 | | | | | | — | | | | | | 13,249,504 | | | | | | — | | | | | | 82,428 | | | | | | (8,539,642) | | | | | | 8,620,878 | | |
Gross Profit (Loss) | | | | | (16,033) | | | | | | — | | | | | | 6,186,064 | | | | | | — | | | | | | 731,691 | | | | | | — | | | | | | 986,163 | | | | | | (2,026,713) | | | | | | 5,861,172 | | |
General and Administrative Expenses | | | | | 887,710 | | | | | | — | | | | | | 3,628,089 | | | | | | — | | | | | | 2,075,148 | | | | | | 221,487 | | | | | | 22,320 | | | | | | (2,026,713) | | | | | | 4,808,041 | | |
Amortization | | | | | — | | | | | | — | | | | | | 1,256,161 | | | | | | 44,286 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,300,447 | | |
Depreciation | | | | | 5,885 | | | | | | — | | | | | | 404,187 | | | | | | 35,105 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 445,177 | | |
Income (Loss) from Operations | | | | | (909,628) | | | | | | — | | | | | | 897,627 | | | | | | (79,391) | | | | | | (1,343,457) | | | | | | (221,487) | | | | | | 963,843 | | | | | | — | | | | | | (692,493) | | |
Other Income (Expense) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Income from investee | | | | | — | | | | | | 50,619 | | | | | | — | | | | | | 7,985,565 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 8,036,184 | | |
Interest expense | | | | | (3,871) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (3,871) | | |
Loss on sale of property and equipment | | | | | — | | | | | | — | | | | | | (25,077) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (25,077) | | |
Interest income | | | | | 53 | | | | | | 178 | | | | | | 779 | | | | | | 192 | | | | | | — | | | | | | — | | | | | | 16 | | | | | | — | | | | | | 1,218 | | |
Total Other Income (Expense) | | | | | (3,818) | | | | | | 50,797 | | | | | | (24,298) | | | | | | 7,985,757 | | | | | | — | | | | | | — | | | | | | 16 | | | | | | — | | | | | | 8,008,454 | | |
Net Income (Loss) | | | | $ | (913,446) | | | | | $ | 50,797 | | | | | $ | 873,329 | | | | | $ | 7,906,366 | | | | | $ | (1,343,457) | | | | | $ | (221,487) | | | | | $ | 963,859 | | | | | $ | — | | | | | $ | 7,315,961 | | |
| | | Page(s) | |
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS: | | | | |
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| | | March 31, 2022 | | | December 31, 2021 | | ||||||
| | | (Unaudited and As Restated) | | | (As Restated) | | ||||||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 139,637 | | | | | $ | 99,118 | | |
Accounts Receivable, net | | | | | 17,676 | | | | | | 17,410 | | |
Notes Receivable | | | | | — | | | | | | 285 | | |
Inventory | | | | | 163,781 | | | | | | 140,703 | | |
Prepaid Expenses and Other Current Assets | | | | | 22,583 | | | | | | 19,528 | | |
Total Current Assets | | | | | 343,677 | | | | | | 277,044 | | |
Property, Plant and Equipment, net | | | | | 479,747 | | | | | | 452,232 | | |
Right Of Use Assets, net | | | | | 66,522 | | | | | | 61,346 | | |
Intangible Assets, net | | | | | 1,368,358 | | | | | | 1,379,913 | | |
Goodwill | | | | | 375,725 | | | | | | 368,130 | | |
Investment in Associates | | | | | 7,396 | | | | | | 7,491 | | |
Deposits and Other Assets | | | | | 2,514 | | | | | | 2,499 | | |
TOTAL ASSETS | | | | $ | 2,643,939 | | | | | $ | 2,548,655 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 61,050 | | | | | $ | 45,172 | | |
Accrued Liabilities | | | | | 25,332 | | | | | | 42,149 | | |
Income Tax Payable | | | | | 183,823 | | | | | | 154,512 | | |
Current Portion of Lease Liabilities | | | | | 7,427 | | | | | | 6,563 | | |
Current Portion of Notes Payable | | | | | 10,386 | | | | | | 13,771 | | |
Acquisition Consideration Payable | | | | | 137,783 | | | | | | 208,349 | | |
Total Current Liabilities | | | | | 425,801 | | | | | | 470,516 | | |
Long-Term Liabilities: | | | | | | | | | | | | | |
Deferred Revenue | | | | | 1,067 | | | | | | 1,183 | | |
Notes Payable, net of Current Portion | | | | | 373,858 | | | | | | 276,154 | | |
Lease Liabilities, net of Current Portion | | | | | 61,458 | | | | | | 56,812 | | |
Deferred Income Taxes | | | | | 258,972 | | | | | | 262,184 | | |
Total Long-Term Liabilities | | | | | 695,355 | | | | | | 596,333 | | |
TOTAL LIABILITIES | | | | $ | 1,121,156 | | | | | $ | 1,066,849 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,522,783 | | | | | | 1,480,530 | | |
NON-CONTROLLING INTEREST | | | | | — | | | | | | 1,276 | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,643,939 | | | | | $ | 2,548,655 | | |
| | | March 31, 2022 | | | March 31, 2021 | | ||||||
| | | (Unaudited and As Restated) | | | (Unaudited and As Restated) | | ||||||
Revenues, net of discounts | | | | $ | 202,235 | | | | | $ | 120,895 | | |
Cost of Goods Sold, net | | | | | 103,618 | | | | | | 66,605 | | |
Gross Profit | | | | | 98,617 | | | | | | 54,290 | | |
Operating Expenses | | | | | 89,560 | | | | | | 42,665 | | |
Income from Investments in Associates | | | | | 2,005 | | | | | | 803 | | |
Income From Operations | | | | | 11,062 | | | | | | 12,428 | | |
Other Income (Expense): | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | (990) | | | | | | — | | |
Gain on Deconsolidation | | | | | 9,558 | | | | | | — | | |
Gain on Previously Held Equity Interest | | | | | 14,099 | | | | | | — | | |
Other Income (Expense), net | | | | | 2,534 | | | | | | (867) | | |
Interest Expense, net | | | | | (10,671) | | | | | | (1,767) | | |
Total Other Income (Expense) | | | | | 14,530 | | | | | | (2,634) | | |
Net Income Before Provision for Income Taxes and Non-Controlling Interest | | | | | 25,592 | | | | | | 9,794 | | |
Provision For Income Taxes | | | | | (25,515) | | | | | | (16,414) | | |
Net Income (Loss) Before Non-Controlling Interest | | | | | 77 | | | | | | (6,620) | | |
Net Income Attributable to Non-Controlling Interest | | | | | 291 | | | | | | 1,266 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (214) | | | | | $ | (7,886) | | |
Net Loss per share – basic | | | | | (0.00) | | | | | | (0.03) | | |
Net Loss per share – diluted | | | | | (0.00) | | | | | | (0.03) | | |
Basic – weighted average shares outstanding | | | | | 326,285,814 | | | | | | 230,582,166 | | |
Diluted – weighted average shares outstanding | | | | | 326,285,814 | | | | | | 230,582,166 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2021 | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO – related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,000) | | | | | | 279,900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority holders | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 6,614 | | | | | | — | | | | | | — | | | | | | 6,614 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 3,199,219 | | | | | | 62,898 | | | | | | — | | | | | | — | | | | | | 62,898 | | |
Warrants issued and exercised | | | | | — | | | | | | — | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (7,886) | | | | | | 1,266 | | | | | | (6,620) | | |
Balance as of March 31, 2021 (As Restated) | | | | | — | | | | | | 293,199,219 | | | | | $ | 1,030,163 | | | | | $ | 1,361 | | | | | $ | 7,403 | | | | | $ | 1,038,927 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2022 (As Restated) | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
Share-based compensation | | | | | — | | | | | | 771,337 | | | | | | 11,742 | | | | | | — | | | | | | — | | | | | | 11,742 | | |
Issuance of shares in conjunction with acquisition | | | | | — | | | | | | 1,403,067 | | | | | | 13,220 | | | | | | — | | | | | | — | | | | | | 13,220 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,567) | | | | | | (1,567) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 1,381,332 | | | | | | 17,505 | | | | | | — | | | | | | — | | | | | | 17,505 | | |
Net Income | | | | | — | | | | | | — | | | | | | — | | | | | | (214) | | | | | | 291 | | | | | | 77 | | |
Balance as of March 31, 2022 (As Restated) | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,578,232 | | | | | $ | (55,449) | | | | | $ | — | | | | | $ | 1,522,783 | | |
| | | March 31, 2022 | | | March 31, 2021 | | ||||||
| | | (Unaudited and As Restated) | | | (As Restated) | | ||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (214) | | | | | $ | (7,886) | | |
Net income attributable to non-controlling interest | | | | | 291 | | | | | | 1,266 | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 34,434 | | | | | | 11,783 | | |
Non-cash interest expense | | | | | 674 | | | | | | 357 | | |
Non-cash interest income | | | | | — | | | | | | (237) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 4,612 | | | | | | 17,844 | | |
Loss on disposal of property, plant and equipment | | | | | 990 | | | | | | — | | |
Gain on deconsolidation | | | | | (9,558) | | | | | | — | | |
Gain on Disposal of Investments in Associates | | | | | (14,099) | | | | | | — | | |
Bad debt expense | | | | | — | | | | | | 68 | | |
Amortization of debt issuance costs | | | | | 1,514 | | | | | | 136 | | |
Unrealized gain on marketable securities | | | | | (66) | | | | | | — | | |
Write-off of note receivable | | | | | (3) | | | | | | — | | |
Income from underlying investees | | | | | (455) | | | | | | (6,702) | | |
Loss (income) on share issuance | | | | | 3,592 | | | | | | (125) | | |
Decrease in fair value of contingent consideration | | | | | (2,467) | | | | | | — | | |
Stock based compensation | | | | | 10,912 | | | | | | 5,752 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | |
Accounts receivable | | | | | (269) | | | | | | (6,131) | | |
Inventories | | | | | (26,595) | | | | | | (19,239) | | |
Prepaid expenses and other current assets | | | | | 1,117 | | | | | | (5,522) | | |
Deposits and other assets | | | | | 695 | | | | | | 1,071 | | |
Accounts payable | | | | | 19,873 | | | | | | 10,942 | | |
Accrued liabilities | | | | | (12,233) | | | | | | 1,827 | | |
Lease Liabilities | | | | | (2,955) | | | | | | (1,217) | | |
Income tax payable | | | | | 27,995 | | | | | | 22,180 | | |
Deferred taxes | | | | | (3,212) | | | | | | (240) | | |
Deferred revenue | | | | | (116) | | | | | | (997) | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 34,457 | | | | | | 24,930 | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (48,300) | | | | | | (36,402) | | |
Proceeds from disposal of assets | | | | | 1,818 | | | | | | 734 | | |
Advances to related parties | | | | | — | | | | | | 20 | | |
Distributions to minority holders | | | | | — | | | | | | (100) | | |
Purchases of intangible assets | | | | | — | | | | | | (7,460) | | |
Acquisition of business, net of cash acquired | | | | | (60,082) | | | | | | (38,573) | | |
Proceeds from sale deconsolidation and investment in Associates | | | | | 19,821 | | | | | | — | | |
Purchase of interest in investment in associates | | | | | — | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | — | | | | | | 10,275 | | |
Issuance of note receivable | | | | | — | | | | | | (147) | | |
Proceeds from note receivable | | | | | — | | | | | | 2,931 | | |
Interest received on note receivable | | | | | — | | | | | | 4 | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (86,743) | | | | | | (72,068) | | |
| | | March 31, 2022 | | | March 31, 2021 | | ||||||
| | | (Unaudited and As Restated) | | | (As Restated) | | ||||||
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | | 102,660 | | | | | | — | | |
Principal repayments of notes payable | | | | | (6,870) | | | | | | (7,516) | | |
Debt issuance costs paid | | | | | (2,985) | | | | | | — | | |
Proceeds received from RTO Financing | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 92,805 | | | | | | 143,004 | | |
NET INCREASE IN CASH | | | | | 40,519 | | | | | | 95,866 | | |
CASH, BEGINNING OF PERIOD | | | | | 99,118 | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 139,637 | | | | | $ | 112,268 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | |
Interest paid | | | | $ | 9,999 | | | | | $ | 1,648 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 541 | | | | | $ | 1,200 | | |
Consideration received in stock for the disposal of assets | | | | $ | 3,776 | | | | | $ | — | | |
Issuance of shares under business combinations | | | | $ | 27,135 | | | | | $ | 690,109 | | |
Acquisitions | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 17,532 | | | | | $ | 787,405 | | |
Liabilities assumed | | | | | (3,981) | | | | | | (215,083) | | |
Acquisition consideration payable | | | | | 38,936 | | | | | | (731,059) | | |
Goodwill | | | | | 7,595 | | | | | | 197,310 | | |
| | | | $ | 60,082 | | | | | $ | 38,573 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
ASSETS | | | | | | | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 139,637 | | | | | $ | — | | | | | $ | 139,637 | | |
Accounts Receivable, net | | | | | 17,676 | | | | | | — | | | | | | 17,676 | | |
Notes Receivable | | | | | — | | | | | | — | | | | | | — | | |
Inventory | | | | | 159,883 | | | | | | 3,898(a) | | | | | | 163,781 | | |
Prepaid Expenses and Other Current Assets | | | | | 22,583 | | | | | | — | | | | | | 22,583 | | |
Total Current Assets | | | | | 339,779 | | | | | | 3,898(a) | | | | | | 343,677 | | |
Property, Plant and Equipment, net | | | | | 479,747 | | | | | | — | | | | | | 479,747 | | |
Right Of Use Assets, net | | | | | 66,522 | | | | | | — | | | | | | 66,522 | | |
Intangible Assets, net | | | | | 1,368,358 | | | | | | — | | | | | | 1,368,358 | | |
Goodwill | | | | | 375,725 | | | | | | — | | | | | | 375,725 | | |
Investment in Associates | | | | | 7,396 | | | | | | — | | | | | | 7,396 | | |
Deposits and Other Assets | | | | | 2,514 | | | | | | — | | | | | | 2,514 | | |
TOTAL ASSETS | | | | $ | 2,640,041 | | | | | $ | 3,898(a) | | | | | $ | 2,643,939 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 61,050 | | | | | $ | — | | | | | $ | 61,050 | | |
Accrued Liabilities | | | | | 25,332 | | | | | | — | | | | | | 25,332 | | |
Income Tax Payable | | | | | 203,939 | | | | | | (20,116)(b)(d) | | | | | | 183,823 | | |
Current Portion of Lease Liabilities | | | | | 7,427 | | | | | | — | | | | | | 7,427 | | |
Current Portion of Notes Payable | | | | | 10,386 | | | | | | — | | | | | | 10,386 | | |
Acquisition Consideration Payable | | | | | 142,543 | | | | | | (4,760)(d) | | | | | | 137,783 | | |
Total Current Liabilities | | | | | 450,677 | | | | | | (24,876)(b)(d) | | | | | | 425,801 | | |
Long-Term Liabilities: | | | | | | | | | | | | | | | | | | | |
Deferred Revenue | | | | | 1,068 | | | | | | — | | | | | | 1,068 | | |
Notes Payable, net of Current Portion | | | | | 373,858 | | | | | | — | | | | | | 373,858 | | |
Lease Liabilities, net of Current Portion | | | | | 61,458 | | | | | | — | | | | | | 61,458 | | |
Deferred Income Taxes | | | | | 256,312 | | | | | | 2,659(b) | | | | | | 258,971 | | |
Total Long-Term Liabilities | | | | | 692,696 | | | | | | 2,659(b) | | | | | | 695,355 | | |
TOTAL LIABILITIES | | | | $ | 1,143,373 | | | | | $ | (22,217)(b)(d) | | | | | $ | 1,121,156 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,496,668 | | | | | | 26,115(a)(b)(d) | | | | | | 1,522,783 | | |
NON-CONTROLLING INTEREST | | | | | — | | | | | | — | | | | | | — | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,640,041 | | | | | $ | 3,898(a)(b) | | | | | $ | 2,643,939 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Revenues, net of discounts | | | | $ | 202,235 | | | | | $ | — | | | | | $ | 202,235 | | |
Cost of Goods Sold, net | | | | | 102,566 | | | | | | 1,052(a) | | | | | | 103,618 | | |
Gross Profit | | | | | 99,669 | | | | | | (1,052)(a) | | | | | | 98,617 | | |
Operating Expenses | | | | | 79,988 | | | | | | 9,572(a) | | | | | | 89,560 | | |
Income from Investments in Associates | | | | | 367 | | | | | | 1,638(b) | | | | | | 2,005 | | |
Income From Operations | | | | | 20,048 | | | | | | (8,986)(a)(b) | | | | | | 11,062 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | (990) | | | | | | — | | | | | | (990) | | |
Gain on Deconsolidation | | | | | 9,558 | | | | | | — | | | | | | 9,558 | | |
Gain on Previously Held Equity Interest | | | | | 17,275 | | | | | | (3,176)(b) | | | | | | 14,099 | | |
Other Income (Expense), net | | | | | (2,227) | | | | | | 4,761(d) | | | | | | 2,534 | | |
Interest Income (Expense), net | | | | | (10,672) | | | | | | — | | | | | | (10,672) | | |
Total Other Income (Expense) | | | | | 12,944 | | | | | | 1,587(d)(b) | | | | | | 14,530 | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 32,993 | | | | | | (7,401)(a)(d)(b) | | | | | | 25,592 | | |
Provision For Income Taxes | | | | | (42,833) | | | | | | 17,318(a)(b)(d) | | | | | | (25,515) | | |
Net Income (Loss) Before Non-Controlling Interest | | | | | (9,840) | | | | | | 9,917(a)(b)(d) | | | | | | 77 | | |
Net Income Attributable to Non-Controlling Interest | | | | | 291 | | | | | | — | | | | | | 291 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (10,131) | | | | | $ | 9,917(a)(b)(d) | | | | | $ | (214) | | |
Net Loss per share – basic | | | | | (0.03) | | | | | | 0.03(a)(b)(d) | | | | | | (0.00) | | |
Net Loss per share – diluted | | | | | (0.03) | | | | | | 0.03(a)(b)(d) | | | | | | (0.00) | | |
Basic – weighted average shares outstanding | | | | | 326,285,814 | | | | | | — | | | | | | 326,285,814 | | |
Diluted – weighted average shares outstanding | | | | | 326,285,814 | | | | | | — | | | | | | 326,285,814 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2022 | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,488,188 | | | | | $ | (12,404) | | | | | $ | 2,951 | | | | | $ | 1,478,735 | | |
Share-based compensation | | | | | — | | | | | | 771,337 | | | | | | 289 | | | | | | — | | | | | | — | | | | | | 289 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 1,403,067 | | | | | | 13,220 | | | | | | — | | | | | | — | | | | | | 13,220 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (3,242) | | | | | | (3,242) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 1,381,332 | | | | | | 17,506 | | | | | | — | | | | | | — | | | | | | 17,506 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (10,131) | | | | | | 291 | | | | | | (9,840) | | |
Balance as of March 31, 2022 | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,519,203 | | | | | $ | (22,535) | | | | | $ | — | | | | | $ | 1,496,668 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Adjustments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance at January 1, 2022 | | | | | — | | | | | | — | | | | | | 47,577 | | | | | | (42,831) | | | | | | (1,675) | | | | | | 3,071 | | |
Share-based compensation(a) | | | | | — | | | | | | — | | | | | | 11,453 | | | | | | — | | | | | | — | | | | | | 11,453 | | |
Noncontrolling interest adjustment for change in ownership(c) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,675 | | | | | | 1,675 | | |
Net Income(a)(b)(d) | | | | | — | | | | | | — | | | | | | — | | | | | | 9,917 | | | | | | — | | | | | | 9,917 | | |
Total Adjustments | | | | | — | | | | | | — | | | | | | 59,030 | | | | | | (32,914) | | | | | | — | | | | | | 26,116 | | |
As Restated | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 – As Restated | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
Share-based compensation | | | | | — | | | | | | 771,337 | | | | | | 11,742 | | | | | | — | | | | | | — | | | | | | 11,742 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 1,403,067 | | | | | | 13,220 | | | | | | — | | | | | | — | | | | | | 13,220 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,567) | | | | | | (1,567) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 1,381,332 | | | | | | 17,505 | | | | | | — | | | | | | — | | | | | | 17,505 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (214) | | | | | | 291 | | | | | | 77 | | |
Balance as of March 31, 2022 – As Restated | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,578,233 | | | | | $ | (55,449) | | | | | $ | — | | | | | $ | 1,522,783 | | |
|
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (10,131) | | | | | $ | 9,917(a)(b)(d) | | | | | $ | (214) | | |
Net income attributable to non-controlling interest | | | | | 291 | | | | | | — | | | | | | 291 | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 34,434 | | | | | | — | | | | | | 34,434 | | |
Non-cash interest expense | | | | | 674 | | | | | | — | | | | | | 674 | | |
Non-cash interest income | | | | | — | | | | | | — | | | | | | — | | |
Non-cash inventory step-up expense on acquisitions | | | | | 4,612 | | | | | | — | | | | | | 4,612 | | |
Loss on disposal of property, plant and equipment | | | | | 990 | | | | | | — | | | | | | 990 | | |
Gain on deconsolidation | | | | | (9,558) | | | | | | — | | | | | | (9,558) | | |
Gain on Disposal of Investments in Associates | | | | | (17,275) | | | | | | 3,176(b) | | | | | | (14,099) | | |
Bad debt expense | | | | | — | | | | | | — | | | | | | — | | |
Amortization of debt issuance costs | | | | | 1,514 | | | | | | — | | | | | | 1,514 | | |
Unrealized gain on marketable securities | | | | | (66) | | | | | | — | | | | | | (66) | | |
Write-off of note receivable | | | | | (3) | | | | | | — | | | | | | (3) | | |
Loss (Income) from underlying investees | | | | | 1,183 | | | | | | 1,638(c) | | | | | | (455) | | |
Loss on share issuance | | | | | 3,592 | | | | | | — | | | | | | 3,592 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Increase (Decrease) in fair value of contingent consideration | | | | | 2,293 | | | | | | (4,760)(d) | | | | | | (2,467) | | |
Stock based compensation | | | | | 289 | | | | | | 10,623(a) | | | | | | 10,912 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | — | | | | | | | | |
Accounts receivable | | | | | (269) | | | | | | — | | | | | | (269) | | |
Inventories | | | | | (26,595) | | | | | | — | | | | | | (26,595) | | |
Prepaid expenses and other current assets | | | | | 1,117 | | | | | | — | | | | | | 1,117 | | |
Deposits and other assets | | | | | 695 | | | | | | — | | | | | | 695 | | |
Accounts payable | | | | | 19,873 | | | | | | — | | | | | | 19,873 | | |
Accrued liabilities | | | | | (12,223) | | | | | | — | | | | | | (12,233) | | |
Lease Liabilities | | | | | (2,955) | | | | | | — | | | | | | (2,955) | | |
Income tax payable | | | | | 48,773 | | | | | | (20,778)(b)(d) | | | | | | 27,995 | | |
Deferred taxes | | | | | (6,672) | | | | | | 3,460(b) | | | | | | (3,212) | | |
Deferred revenue | | | | | (116) | | | | | | — | | | | | | (116) | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 34,457 | | | | | | — | | | | | | 34,457 | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (48,300) | | | | | | — | | | | | | (48,300) | | |
Proceeds from disposal of assets | | | | | 1,818 | | | | | | — | | | | | | 1,818 | | |
Advances to related parties | | | | | — | | | | | | — | | | | | | — | | |
Distributions to minority holders | | | | | — | | | | | | — | | | | | | — | | |
Purchases of intangible assets | | | | | — | | | | | | — | | | | | | — | | |
Acquisition of business, net of cash acquired | | | | | (60,082) | | | | | | — | | | | | | (60,082) | | |
Proceeds from sale deconsolidation and investment in Associates | | | | | 19,821 | | | | | | — | | | | | | 19,821 | | |
Purchase of interest in investment in associates | | | | | — | | | | | | — | | | | | | — | | |
Dividend received from investments in associates | | | | | — | | | | | | — | | | | | | — | | |
Issuance of note receivable | | | | | — | | | | | | — | | | | | | — | | |
Proceeds from note receivable | | | | | — | | | | | | — | | | | | | — | | |
Interest received on note receivable | | | | | — | | | | | | — | | | | | | — | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (86,743) | | | | | | — | | | | | | (86,743) | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | $ | 102,660 | | | | | $ | — | | | | | $ | 102,660 | | |
Principal repayments of notes payable | | | | | (6,870) | | | | | | — | | | | | | (6,870) | | |
Debt issuance costs paid | | | | | (2,985) | | | | | | — | | | | | | (2,985) | | |
Proceeds received from RTO financing | | | | | — | | | | | | — | | | | | | — | | |
Cash received in warrant private placement | | | | | — | | | | | | — | | | | | | — | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 92,805 | | | | | | — | | | | | | 92,805 | | |
NET INCREASE IN CASH | | | | | 40,519 | | | | | | — | | | | | | 40,519 | | |
CASH, BEGINNING OF PERIOD | | | | | 99,118 | | | | | | — | | | | | | 99,118 | | |
CASH, END OF PERIOD | | | | $ | 139,637 | | | | | $ | — | | | | | $ | 139,637 | | |
|
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | | | | | | | |
Interest paid | | | | $ | 9,999 | | | | | $ | — | | | | | $ | 9,999 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 541 | | | | | $ | — | | | | | $ | 541 | | |
Consideration received in stock for the disposal of assets | | | | $ | 3,776 | | | | | $ | — | | | | | $ | 3,776 | | |
Issuance of shares under business combinations | | | | $ | 27,135 | | | | | $ | — | | | | | $ | 27,135 | | |
Acquisitions | | | | | | | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 17,532 | | | | | $ | — | | | | | $ | 17,532 | | |
Liabilities assumed | | | | | (3,981) | | | | | | — | | | | | | (3,981) | | |
Acquisition consideration payable | | | | | 38,936 | | | | | | — | | | | | | 38,936 | | |
Goodwill | | | | | 7,595 | | | | | | — | | | | | | 7,595 | | |
| | | | $ | 60,082 | | | | | $ | — | | | | | $ | 60,082 | | |
Revenues, net of discounts | | | | $ | 120,895 | | | | | $ | — | | | | | $ | 120,895 | | |
Cost of Goods Sold, net | | | | | 66,605 | | | | | | — | | | | | | 66,605 | | |
Gross Profit | | | | | 54,290 | | | | | | — | | | | | | 54,290 | | |
Operating Expenses | | | | | 36,973 | | | | | | 5,692(a) | | | | | | 42,665 | | |
Income from Investments in Associates | | | | | 803 | | | | | | — | | | | | | 803 | | |
Income From Operations | | | | | 18,120 | | | | | | (5,692)(a) | | | | | | 12,428 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | — | | | | | | — | | | | | | — | | |
Gain on Deconsolidation | | | | | — | | | | | | — | | | | | | — | | |
Gain on Previously Held Equity Interest | | | | | — | | | | | | — | | | | | | — | | |
Other Income (Expense), net | | | | | (867) | | | | | | — | | | | | | (867) | | |
Interest Income (Expense), net | | | | | (1,767) | | | | | | — | | | | | | (1,767) | | |
Total Other Income (Expense) | | | | | (2,634) | | | | | | — | | | | | | (2,634) | | |
Net Income Before Provision for Income Taxes and Non-Controlling Interest | | | | | 15,486 | | | | | | (5,692)(a) | | | | | | 9,794 | | |
Provision For Income Taxes | | | | | (16,414) | | | | | | — | | | | | | (16,414) | | |
Net Loss Before Non-Controlling Interest | | | | | (928) | | | | | | (5,692)(a) | | | | | | (6,620) | | |
Net Income Attributable to Non-Controlling Interest | | | | | 1,266 | | | | | | — | | | | | | 1,266 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (2,194) | | | | | $ | (5,692)(a) | | | | | $ | (7,886) | | |
Net Loss per share – basic | | | | | (0.02) | | | | | | (0.01)(a) | | | | | | (0.03) | | |
Net Loss per share – diluted | | | | | (0.02) | | | | | | (0.01)(a) | | | | | | (0.03) | | |
Basic – weighted average shares outstanding | | | | | 140,952,177 | | | | | | 89,629,989(a) | | | | | | 230,582,166 | | |
Diluted – weighted average shares outstanding | | | | | 140,952,177 | | | | | | 89,629,989(a) | | | | | | 230,582,166 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2021 | | | | | 279,900,00 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,00) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Share-based compensation | | | | | — | | | | | | 61 | | | | | | — | | | | | | — | | | | | | 61 | | | | | | | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 3,199,219 | | | | | | 62,898 | | | | | | — | | | | | | — | | | | | | 62,898 | | |
Warrants issued and exercised | | | | | — | | | | | | — | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (2,194) | | | | | | 1,266 | | | | | | (928) | | |
Balance as of March 31, 2021 | | | | | | | | | | | 293,199,219 | | | | | $ | 1,023,609 | | | | | $ | 7,053 | | | | | $ | 7,503 | | | | | $ | 1,038,166 | | |
Adjustments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance at January 1, 2021 | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Share-based compensation(a) | | | | | — | | | | | | — | | | | | | 6,553 | | | | | | — | | | | | | — | | | | | | 6,553 | | |
Distributions to minority holders(c) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Net Loss(a)(b) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,692) | | | | | | — | | | | | | (5,692) | | |
Total Adjustments | | | | | — | | | | | | — | | | | | | 6,553 | | | | | | (5,692) | | | | | | (100) | | | | | | 761 | | |
As Restated | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 – As Restated | | | | | 279,900,00 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,00) | | | | | | — | | | | | | | | | | | | | | | | | | | | | | | | | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority holders | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 6,614 | | | | | | — | | | | | | — | | | | | | 6,614 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 3,199,219 | | | | | | 62,898 | | | | | | — | | | | | | — | | | | | | 62,898 | | |
Warrants issued and exercised | | | | | — | | | | | | — | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (7,886) | | | | | | 1,266 | | | | | | (6,620) | | |
Balance as of March 31, 2021 – As Restated | | | | | | | | | | | 293,199,219 | | | | | $ | 1,030,163 | | | | | $ | 1,361 | | | | | $ | 7,403 | | | | | $ | 1,038,927 | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (2,194) | | | | | $ | (5,692)(a)(b) | | | | | $ | (7,886) | | |
Net income attributable to non-controlling interest | | | | | 1,266 | | | | | | — | | | | | | 1,266 | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 11,783 | | | | | | — | | | | | | 11,783 | | |
Non-cash interest expense | | | | | 357 | | | | | | — | | | | | | 357 | | |
Non-cash interest income | | | | | (237) | | | | | | — | | | | | | (237) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 17,844 | | | | | | — | | | | | | 17,844 | | |
Loss on disposal of property, plant and equipment | | | | | — | | | | | | — | | | | | | — | | |
Gain on deconsolidation | | | | | — | | | | | | — | | | | | | — | | |
Gain on Disposal of Investments in Associates | | | | | — | | | | | | — | | | | | | — | | |
Bad debt expense | | | | | 68 | | | | | | — | | | | | | 68 | | |
Amortization of debt issuance costs | | | | | 136 | | | | | | — | | | | | | 136 | | |
Unrealized gain on marketable securities | | | | | — | | | | | | — | | | | | | — | | |
Write-off of note receivable | | | | | — | | | | | | — | | | | | | — | | |
Loss (Income) from underlying investees | | | | | (6,802) | | | | | | 100(c) | | | | | | (6,702) | | |
Loss (Income) on share issuance | | | | | (125) | | | | | | — | | | | | | (125) | | |
Decrease in fair value of contingent consideration | | | | | — | | | | | | — | | | | | | — | | |
Stock based compensation | | | | | 61 | | | | | | 5,692(a) | | | | | | 5,752 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | — | | | | | | | | |
Accounts receivable | | | | | (6,131) | | | | | | — | | | | | | (6,131) | | |
Inventories | | | | | (19,239) | | | | | | — | | | | | | (19,239) | | |
Prepaid expenses and other current assets | | | | | (5,522) | | | | | | — | | | | | | (5,522) | | |
Deposits and other assets | | | | | 1,071 | | | | | | — | | | | | | 1,071 | | |
Accounts payable | | | | | 10,942 | | | | | | — | | | | | | 10,942 | | |
Accrued liabilities | | | | | 1,827 | | | | | | — | | | | | | 1,827 | | |
Lease Liabilities | | | | | (1,217) | | | | | | — | | | | | | (1,217) | | |
Income tax payable | | | | | 21,940 | | | | | | 240(b) | | | | | | 22,180 | | |
Deferred taxes | | | | | — | | | | | | (240)(b) | | | | | | (240) | | |
Deferred revenue | | | | | (997) | | | | | | — | | | | | | (997) | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 24,831 | | | | | | 100(a)(b)(c) | | | | | | 24,930 | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (36,402) | | | | | | — | | | | | | (36,402) | | |
Proceeds from disposal of assets | | | | | 734 | | | | | | — | | | | | | 734 | | |
Advances to related parties | | | | | 20 | | | | | | — | | | | | | 20 | | |
Distributions to minority holders | | | | | — | | | | | | (100)(c) | | | | | | (100) | | |
Purchases of intangible assets | | | | | (7,460) | | | | | | — | | | | | | (7,460) | | |
Acquisition of business, net of cash acquired | | | | | (38,573) | | | | | | — | | | | | | (38,573) | | |
Proceeds from sale deconsolidation and investment in Associates | | | | | — | | | | | | — | | | | | | — | | |
Purchase of interest in investment in associates | | | | | (3,350) | | | | | | — | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | 10,275 | | | | | | — | | | | | | 10,275 | | |
Issuance of note receivable | | | | | (147) | | | | | | — | | | | | | (147) | | |
Proceeds from note receivable | | | | | 2,931 | | | | | | — | | | | | | 2,931 | | |
Interest received on note receivable | | | | | 4 | | | | | | — | | | | | | 4 | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (71,969) | | | | | | (100)(c) | | | | | | (72,068) | | |
|
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | | — | | | | | | — | | | | | | — | | |
Principal repayments of notes payable | | | | | (7,516) | | | | | | — | | | | | | (7,516) | | |
Debt issuance costs paid | | | | | — | | | | | | — | | | | | | — | | |
Proceeds received from RTO financing | | | | | 75,420 | | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | 75,100 | | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 143,004 | | | | | | — | | | | | | 143,004 | | |
NET INCREASE IN CASH | | | | | 95,866 | | | | | | — | | | | | | 95,866 | | |
CASH, BEGINNING OF PERIOD | | | | | 16,402 | | | | | | — | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 112,268 | | | | | $ | — | | | | | $ | 112,268 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | | | | | | | |
Interest paid | | | | $ | 1,648 | | | | | $ | — | | | | | $ | 1,648 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 1,200 | | | | | $ | — | | | | | $ | 1,200 | | |
Consideration received in stock for the disposal of assets | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Issuance of shares under business combinations | | | | $ | 690,109 | | | | | $ | — | | | | | $ | 690,109 | | |
Acquisitions | | | | | | | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 787,405 | | | | | $ | — | | | | | $ | 787,405 | | |
Liabilities assumed | | | | | (215,083) | | | | | | — | | | | | | (215,083) | | |
Acquisition consideration payable | | | | | (731,059) | | | | | | — | | | | | | (731,059) | | |
Goodwill | | | | | 197,310 | | | | | | — | | | | | | 197,310 | | |
| | | | $ | 38,573 | | | | | $ | — | | | | | $ | 38,573 | | |
|
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Raw Materials | | | | $ | 8,187$ | | | | | | 5,767 | | |
Work in Process | | | | | 114,470 | | | | | | 96,367 | | |
Finished Goods | | | | | 41,124 | | | | | | 38,569 | | |
Total Inventories | | | | $ | 163,781$ | | | | | | 140,703 | | |
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
Land | | | | $ | 28,413 | | | | | $ | 29,399 | | |
Buildings and Improvements | | | | | 154,765 | | | | | | 126,020 | | |
Furniture and Fixtures | | | | | 13,886 | | | | | | 13,259 | | |
Computer Equipment and Software | | | | | 15,715 | | | | | | 14,078 | | |
Leasehold Improvements | | | | | 176,845 | | | | | | 182,514 | | |
Tools and Equipment | | | | | 71,189 | | | | | | 65,774 | | |
Vehicles | | | | | 4,091 | | | | | | 3,229 | | |
Assets Under Construction(1) | | | | | 70,231 | | | | | | 64,107 | | |
Total Property, Plant and Equipment, Gross | | | | | 535,135 | | | | | | 498,380 | | |
Less: Accumulated Depreciation | | | | | (55,388 | | | | | | (46,148 | | |
Property, Plant and Equipment, Net | | | | $ | 479,747 | | | | | $ | 452,232 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | $ | 1,386,131 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,451,900 | | |
Purchases | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Additions from business combination | | | | | 13,281 | | | | | | — | | | | | | — | | | | | | 13,281 | | |
Adjustments to purchase price allocation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Disposals | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Balance as of March 31, 2022 | | | | $ | 1,399,412 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,465,181 | | |
Accumulated Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 66,703 | | | | | | 4,158 | | | | | | 1,126 | | | | | | 71,987 | | |
Amortization | | | | | 23,173 | | | | | | 1,355 | | | | | | 308 | | | | | | 24,836 | | |
Balance as of March 31, 2022 | | | | $ | 89,876 | | | | | $ | 5,513 | | | | | $ | 1,434 | | | | | $ | 96,823 | | |
Net Book Value | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 1,319,428 | | | | | | 50,008 | | | | | | 10,477 | | | | | | 1,379,913 | | |
Balance as of March 31, 2022 | | | | $ | 1,309,536 | | | | | $ | 48,653 | | | | | $ | 10,169 | | | | | $ | 1,368,358 | | |
Year Ending December 31: | | | Estimated Amortization | | | |||||
2022 (Remaining) | | | | $ | 74,961 | | | | ||
2023 | | | | | 99,948 | | | | ||
2024 | | | | | 99,948 | | | | ||
2025 | | | | | 99,948 | | | | ||
2026 | | | | | 99,221 | | | | ||
Thereafter | | | | | 894,332 | | | | ||
| | | | $ | 1,368,358 | | | | | |
| | | January 1, 2022 | | | Impairment | | | Adjustments to purchase price allocation | | | Acquisitions | | | March 31, 2022 | | |||||||||||||||
Cultivation | | | | $ | 91,116 | | | | | $ | — | | | | | $ | 1,050 | | | | | $ | — | | | | | $ | 92,166 | | |
Retail | | | | | 277,014 | | | | | | — | | | | | | — | | | | | | 6,545 | | | | | | 283,559 | | |
Total | | | | $ | 368,130 | | | | | $ | — | | | | | $ | 1,050 | | | | | $ | 6,545 | | | | | $ | 375,725 | | |
| | | Three Months Ended March 31, 2022 | | | Three Months Ended March 31, 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Numerator | | | | ||||||||||
Net Loss attributable to Verano Holdings Corp. | | | | $ | (214) | | | | | $ | (7,886) | | |
Denominator | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | 158,203,932 | | | | | | | | |
Post-RTO weighted-average shares outstanding | | | | | 291,143,545 | | | | | | | | |
Weighted-average shares outstanding – basic | | | | | 326,285,814 | | | | | | 230,582,166 | | |
Diluted | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | 158,203,932 | | | | | | | | |
Post-RTO weighted-average shares outstanding | | | | | 291,143,545 | | | | | | | | |
Weighted-average shares outstanding – basic | | | | | 326,285,814 | | | | | | 230,582,166 | | |
Basic earnings per share | | | | $ | (0.00) | | | | | $ | (0.03) | | |
Diluted earnings per share | | | | $ | (0.00) | | | | | $ | (0.03) | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
Cash | | | | $ | 5,446 | | | | | $ | 507 | | | | | $ | 5,953 | | |
Accounts receivable, net | | | | | 60 | | | | | | 498 | | | | | | 558 | | |
Inventory | | | | | 83,205 | | | | | | 5,827 | | | | | | 89,032 | | |
Prepaids and other current assets | | | | | 833 | | | | | | 1,989 | | | | | | 2,822 | | |
Property, plant and equipment, net | | | | | 73,386 | | | | | | 9,751 | | | | | | 83,137 | | |
Right-of-use asset, net | | | | | 9,651 | | | | | | — | | | | | | 9,651 | | |
Other assets | | | | | 1,001 | | | | | | — | | | | | | 1,001 | | |
Accounts payable and accrued liabilities | | | | | (8,935) | | | | | | (2,576) | | | | | | (11,511) | | |
Notes payable | | | | | (3,579) | | | | | | (3,343) | | | | | | (6,922) | | |
Deferred taxes | | | | | (123,720) | | | | | | (37,290) | | | | | | (161,010) | | |
Lease liabilities | | | | | (9,651) | | | | | | — | | | | | | (9,651) | | |
Total identifiable net assets (liabilities) | | | | | 27,697 | | | | | | (24,637) | | | | | | 3,060 | | |
Intangible assets | | | | | 498,938 | | | | | | 184,588 | | | | | | 683,526 | | |
Net assets | | | | $ | 526,635 | | | | | $ | 159,951 | | | | | $ | 686,586 | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
License | | | | $ | 319,928 | | | | | $ | 130,670 | | | | | $ | 450,598 | | |
Tradename | | | | | 36,278 | | | | | | 8,980 | | | | | | 45,258 | | |
Technology | | | | | 10,603 | | | | | | 885 | | | | | | 11,488 | | |
Total intangible assets | | | | $ | 366,809 | | | | | $ | 140,536 | | | | | $ | 507,344 | | |
Goodwill (residual purchase price) | | | | $ | 8,409 | | | | | $ | 6,763 | | | | | $ | 15,172 | | |
Goodwill (deferred taxes)(a) | | | | | 123,720 | | | | | | 37,290 | | | | | | 161,010 | | |
Total goodwill | | | | $ | 132,129 | | | | | $ | 44,053 | | | | | $ | 176,182 | | |
| | | Consolidated Results | | | AltMed Pre-acquisition | | | Pro-forma Results | | |||||||||
Revenues, net of discounts | | | | | 120,895 | | | | | | 22,402 | | | | | | 143,297 | | |
Net income (loss) | | | | | (7,886) | | | | | | 10,933 | | | | | | 3,047 | | |
| | | Greengate | | |||
Cash and cash equivalents | | | | $ | 2,315 | | |
Inventory | | | | | 1,021 | | |
Prepaid & other current Assets | | | | | 324 | | |
Deposits and Other non-current assets | | | | | 45 | | |
Property, plant and equipment, net | | | | | 1,673 | | |
Right-of-use asset, Net | | | | | 1,836 | | |
Accounts payable and accrued liabilities | | | | | (1,569) | | |
Other liabilities | | | | | (72) | | |
Lease liabilities | | | | | (1,836) | | |
Total identifiable net assets (liabilities) | | | | | 3,737 | | |
Total Intangible assets | | | | | 19,826 | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 86,813 | | | | | $ | 32,123 | | | | | $ | 1,959 | | | | | $ | 120,895 | | |
Net income (loss) | | | | | (2,113) | | | | | | (5,391) | | | | | | (382) | | | | | | (7,886) | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 86,813 | | | | | $ | 54,525 | | | | | $ | 11,611 | | | | | $ | 152,949 | | |
Net income (loss) | | | | | (2,113) | | | | | | 5,541 | | | | | | 2,297 | | | | | | 5,725 | | |
| | | As of | | |||||||||
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
Credit Facility | | | | $ | 350,000 | | | | | $ | 250,000 | | |
Secured Promissory Notes | | | | | 1,687 | | | | | | 6,663 | | |
Mortgage Loans | | | | | 39,084 | | | | | | 38,856 | | |
Vehicle and Equipment Loans | | | | | 2,489 | | | | | | 1,951 | | |
Unamortized debt issuance costs | | | | | (9,016) | | | | | | (7,545) | | |
Total notes payable | | | | $ | 384,244 | | | | | $ | 289,925 | | |
Less: current portion of notes payable | | | | | 10,386 | | | | | | 13,771 | | |
Total long-term debt, net | | | | $ | 373,858 | | | | | $ | 276,154 | | |
| | | Number of Shares | | | Weighted Avg. Exercise Price C$ | | | Weighted Average Remaining Contractual Life | | |||||||||
Balance as of December 31, 2021 | | | | | 56,078 | | | | | | 29.97 | | | | | | 9.16 | | |
Vested | | | | | 18,798 | | | | | | 29.97 | | | | | | | | |
Exercisable at March 31, 2022 | | | | | 24,167 | | | | | | 29.97 | | | | | | 8.92 | | |
| | | Number of Shares | | | Weighted Avg. Grant Date Fair Value C$ | | ||||||
Unvested Shares at December 31, 2021 | | | | | 2,413,887 | | | | | | 29.98 | | |
Granted | | | | | 243,710 | | | | | | 16.30 | | |
Forfeited | | | | | 975 | | | | | | 23.30 | | |
Vested | | | | | 1,179,961 | | | | | | 30.31 | | |
Unvested Shares at March 31, 2022 | | | | | 1,476,661 | | | | | | 27.75 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Weighted average grant date fair value (per share) of RSUs granted (C$) | | | | | 16.30 | | | | | | 30.11 | | |
Intrinsic value of RSUs vested, using market price at vest date (C$) (in thousands) | | | | | 15.41 | | | | | | — | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Stock Options Expense | | | | $ | 63 | | | | | $ | 53 | | |
Restricted Stock Units | | | | | 10,850 | | | | | | 5,699 | | |
Total Stock Based Compensation Expense | | | | $ | 10,913 | | | | | $ | 5,752 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Income before Income Taxes | | | | $ | 25,592 | | | | | $ | 9,794 | | |
Income Tax Expense | | | | | (25,515) | | | | | | (16,414) | | |
Effective Tax Rate | | | | | 86.8% | | | | | | 173.0% | | |
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
Weighted average remaining lease term (years) | | | | | 8.18 | | | | | | 8.52 | | |
Weighted average discount rate | | | | | 8.03% | | | | | | 8.11% | | |
Year Ending December 31, | | | | | | | |
Remainder 2022 | | | | | 9,295 | | |
2023 | | | | | 11,873 | | |
2024 | | | | | 11,274 | | |
2025 | | | | | 10,318 | | |
2026 | | | | | 9,416 | | |
2027 and Thereafter | | | | | 41,733 | | |
Total Lease Payments | | | | | 93,909 | | |
Less: Interest | | | | | (25,024) | | |
Present Value of Lease Liability | | | | | 68,885 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Revenue, net of discounts | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 53,008 | | | | | $ | 49,161 | | |
Retail | | | | | 164,334 | | | | | | 79,195 | | |
Intersegment Eliminations | | | | | (15,107) | | | | | | (7,461) | | |
Total Revenue, net of discounts | | | | | 202,235 | | | | | | 120,895 | | |
Depreciation and Amortization | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 19,725 | | | | | | 8,320 | | |
Retail | | | | | 14,709 | | | | | | 3,463 | | |
Total Depreciation and Amortization | | | | | 34,434 | | | | | | 11,783 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Income taxes | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 11,237 | | | | | | 3,696 | | |
Retail | | | | | 14,278 | | | | | | 12,718 | | |
Total Income Taxes | | | | | 25,515 | | | | | | 16,414 | | |
|
| | | Consolidated VIE | | | Consolidated VOE | | | Consolidated VIE | | | Consolidated VOE | | | | ||||||||||||||||
| | | March 31, 2022 | | | December 31, 2021 | | | | ||||||||||||||||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||||||||||||||
Current Assets | | | | $ | 47,572 | | | | | $ | 18,244 | | | | | $ | 43,045 | | | | | $ | 20,464 | | | | | ||||
Due To/(From) | | | | | (33,082) | | | | | | (6,084) | | | | | | (25,723) | | | | | | 14,228 | | | | | ||||
Non-Current Assets | | | | | 205,503 | | | | | | 245,293 | | | | | | 207,908 | | | | | | 226,108 | | | | | ||||
Current Liabilities | | | | | 34,576 | | | | | | 12,358 | | | | | | 32,934 | | | | | | 22,659 | | | | | ||||
Non-Current Liabilities | | | | | 42,552 | | | | | | 45,438 | | | | | | 45,873 | | | | | | 45,603 | | | | | ||||
Non-controlling Interest | | | | | — | | | | | | — | | | | | | 1,276 | | | | | | — | | | | | ||||
Equity attributable to Verano Holdings, Corp. | | | | | 142,865 | | | | | | 199,657 | | | | | | 145,147 | | | | | | 192,538 | | | | |
| | | As of March 31, 2022 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
(As Restated) | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and Cash Equivalents | | | | $ | 139,637 | | | | | $ | — | | | | | $ | — | | | | | $ | 139,637 | | |
Investments | | | | | 3,842 | | | | | | — | | | | | | — | | | | | | 3,842 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (137,783) | | | | | | (137,783) | | |
Total | | | | $ | 143,479 | | | | | $ | — | | | | | $ | (137,783) | | | | | $ | 5,696 | | |
| | | As of December 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 99,118 | | | | | $ | — | | | | | $ | — | | | | | $ | 99,118 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (208,349) | | | | | | (208,349) | | |
Total | | | | $ | 99,118 | | | | | $ | — | | | | | $ | (208,349) | | | | | $ | (109,231) | | |
| | | For the Year Ended December 31, 2021 | | |||||||||||||||||||||||||||
($ in Thousands) | | | Verano Holdings Corp. | | | AME Group Pre-Acquisition | | | Pro Forma Adjustments | | | | | | | | | Pro Forma Combined | | ||||||||||||
Revenues, net of discounts | | | | | 737,850 | | | | | | 22,402 | | | | | | | | | | | | | | | | | | 760,252 | | |
Cost of Goods Sold | | | | | 406,831 | | | | | | 8,087 | | | | | | (68,934) | | | | | | a | | | | | | 345,984 | | |
Gross Profit | | | | | 331,019 | | | | | | 14,315 | | | | | | 68,934 | | | | | | | | | | | | 414,268 | | |
Total Operating Expenses | | | | | 270,929 | | | | | | 3,299 | | | | | | 377 | | | | | | b | | | | | | 275,395 | | |
Other Income (Expense) | | | | | (117,597) | | | | | | (83) | | | | | | | | | | | | | | | | | | (117,680) | | |
Net Income (Loss) | | | | | (57,507) | | | | | | 10,933 | | | | | | 68,557 | | | | | | c | | | | | | 21,983 | | |
Net Income (Loss) per share – basic | | | | | (0.20) | | | | | | — | | | | | | | | | | | | | | | | | | 0.06 | | |
Net Income (Loss) per share – diluted | | | | | (0.20) | | | | | | — | | | | | | | | | | | | | | | | | | 0.06 | | |
Weighted average number of shares – basic | | | | | 290,443,432 | | | | | | 65,191,388 | | | | | | | | | | | | | | | | | | 355,634,820 | | |
Weighted average number of shares – diluted | | | | | 290,443,432 | | | | | | 65,191,388 | | | | | | | | | | | | | | | | | | 364,353,560 | | |
| | | For the Three Months Ended March 31, | | | 2022 – 2021 | | ||||||||||||
| | ||||||||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Revenue, net of discounts | | | | $ | 202,235 | | | | | $ | 120,895 | | | | | $ | 81,340 | | |
Gross Profit | | | | | 98,617 | | | | | | 54,290 | | | | | | 44,327 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (214) | | | | | | (7,886) | | | | | | 7,672 | | |
Net Loss per share – basic | | | | | (0.00) | | | | | | (0.03) | | | | | | 0.03 | | |
Net Loss per share – diluted | | | | | (0.00) | | | | | | (0.03) | | | | | | 0.03 | | |
($ in thousands) | | | March 31, 2022 | | | December 31, 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Total Assets | | | | $ | 2,643,939 | | | | | $ | 2,548,655 | | |
Long-Term Liabilities | | | | | 695,355 | | | | | | 596,333 | | |
| | | For the Three Months Ended March 31, | | | 2022 – 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Cost of Goods Sold, net | | | | $ | 103,618 | | | | | $ | 66,605 | | | | | $ | 37,013 | | |
Total Operating Expense | | | | | 89,560 | | | | | | 42,665 | | | | | | 46,895 | | |
Other Income (Expense) | | | | | 14,530 | | | | | | (2,634) | | | | | | 17,164 | | |
Provision for Income Taxes | | | | | (25,515) | | | | | | (16,414) | | | | | | (9,101) | | |
| | | For the Year Ended December 31, | | | 2021 – 2020 | | ||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | $ Change | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Revenue, net of discounts | | | | $ | 737,850 | | | | | $ | 228,530 | | | | | $ | 509,320 | | |
Gross Profit | | | | | 331,019 | | | | | | 135,569 | | | | | | 195,450 | | |
Net Income (Loss) attributable to Verano Holdings Corp. | | | | | (57,507) | | | | | | 38,401 | | | | | | (95,908) | | |
Net Income (Loss) per share – basic | | | | | (0.20) | | | | | | 0.15 | | | | | | (0.35) | | |
Net Income (Loss) per share – diluted | | | | | (0.20) | | | | | | 0.14 | | | | | | (0.34) | | |
| | | For the Year Ended December 31, | | | 2021 – 2020 | | ||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | $ Change | | |||||||||
| | | (As Restated) | | | | | | | | | ||||||||
Cost of Goods Sold, net | | | | $ | 406,831 | | | | | $ | 92,961 | | | | | $ | 313,870 | | |
General and Administrative | | | | | 100,903 | | | | | | 23,838 | | | | | | 77,065 | | |
Sales and Marketing Expense | | | | | 8,644 | | | | | | 919 | | | | | | 7,725 | | |
Salaries and Benefits | | | | | 119,598 | | | | | | 16,228 | | | | | | 103,370 | | |
Depreciation and Amortization | | | | | 41,784 | | | | | | 2,278 | | | | | | 39,506 | | |
Total Operating Expense | | | | | 270,929 | | | | | | 43,263 | | | | | | 227,666 | | |
Other Expenses | | | | | 15,723 | | | | | | 12,546 | | | | | | 3,177 | | |
Provision for Income Taxes | | | | | (103,988) | | | | | | (42,296) | | | | | | (61,692) | | |
| | | For the Year Ended December 31, | | | 2020 – 2019 | | ||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | $ Change | | |||||||||
Revenues, net of discounts | | | | $ | 228,530 | | | | | $ | 65,968 | | | | | $ | 162,562 | | |
Gross Profit | | | | | 135,569 | | | | | | 36,040 | | | | | | 99,529 | | |
Net Income (Loss) attributable to Verano Holdings, LLC | | | | | 38,401 | | | | | | (18,273) | | | | | | 56,674 | | |
Net Income (Loss) per share – basic | | | | | 0.15 | | | | | | (0.07) | | | | | | 0.22 | | |
Net Income (Loss) per share – diluted | | | | | 0.14 | | | | | | (0.07) | | | | | | 0.21 | | |
| | | For the Year Ended December 31, | | | 2020 – 2019 | | ||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | $ Change | | |||||||||
Cost of goods sold | | | | $ | 92,961 | | | | | $ | 29,928 | | | | | $ | 63,033 | | |
General and Administrative | | | | | 23,838 | | | | | | 29,692 | | | | | | (5,854) | | |
Sales and Marketing Expense | | | | | 919 | | | | | | 926 | | | | | | (7) | | |
Salaries and Benefits | | | | | 16,228 | | | | | | 6,231 | | | | | | 9,997 | | |
Depreciation and Amortization | | | | | 2,278 | | | | | | 2,288 | | | | | | (10) | | |
Total Operating Expense | | | | | 43,263 | | | | | | 39,137 | | | | | | 4,126 | | |
Other Expenses | | | | | 12,546 | | | | | | 4,938 | | | | | | 7,608 | | |
Provision for Income Taxes | | | | | (42,296) | | | | | | (10,333) | | | | | | (31,963) | | |
| | | For the Year Ended December 31, | | | 2020 – 2019 | | ||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | $ Change | | |||||||||
Revenues, net of discounts | | | | $ | 228,530 | | | | | $ | 65,968 | | | | | $ | 162,562 | | |
Gross Profit | | | | | 135,569 | | | | | | 36,040 | | | | | | 99,529 | | |
Net Income (Loss) attributable to Verano Holdings, LLC | | | | | 38,401 | | | | | | (18,273) | | | | | | 56,674 | | |
Net Income (Loss) per share – basic | | | | | 0.15 | | | | | | (0.07) | | | | | | 0.22 | | |
Net Income (Loss) per share – diluted | | | | | 0.14 | | | | | | (0.07) | | | | | | 0.21 | | |
| | | For the Year Ended December 31, | | | 2020 – 2019 | | ||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | $ Change | | |||||||||
Cost of goods sold | | | | $ | 92,961 | | | | | $ | 29,928 | | | | | $ | 63,033 | | |
General and Administrative | | | | | 23,838 | | | | | | 29,692 | | | | | | (5,854) | | |
Sales and Marketing Expense | | | | | 919 | | | | | | 926 | | | | | | (7) | | |
Salaries and Benefits | | | | | 16,228 | | | | | | 6,231 | | | | | | 9,997 | | |
Depreciation and Amortization | | | | | 2,278 | | | | | | 2,288 | | | | | | (10) | | |
Total Operating Expense | | | | | 43,263 | | | | | | 39,137 | | | | | | 4,126 | | |
Other Expenses | | | | | 12,546 | | | | | | 4,938 | | | | | | 7,608 | | |
Provision for Income Taxes | | | | | (42,296) | | | | | | (10,333) | | | | | | (31,963) | | |
| | | Three Months Ended March 31, | | |||||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | % Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 53,008 | | | | | $ | 49,161 | | | | | | 7.8% | | |
Retail | | | | | 164,334 | | | | | | 79,195 | | | | | | 107.5% | | |
Intersegment Eliminations | | | | | (15,107) | | | | | | (7,461) | | | | | | (102.5)% | | |
Total Revenues, net of discounts | | | | | 202,235 | | | | | | 120,895 | | | | | | 67.3% | | |
| | | For the Year Ended December 31, | | |||||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | % Change | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 217,739 | | | | | $ | 156,223 | | | | | | 39.4% | | |
Retail | | | | | 591,591 | | | | | | 88,470 | | | | | | 568.7% | | |
Intersegment Eliminations | | | | | (71,480) | | | | | | (16,163) | | | | | | (342.2)% | | |
Total Revenues, net of discounts | | | | $ | 737,850 | | | | | | 228,530 | | | | | | 222.9% | | |
| | | For the Year Ended December 31, | | |||||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | % Change | | |||||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 156,223 | | | | | $ | 46,068 | | | | | | 239.1% | | |
Retail | | | | | 88,470 | | | | | | 22,925 | | | | | | 285.9% | | |
Intersegment Eliminations | | | | | (16,163) | | | | | | (3,025) | | | | | | (434.3)% | | |
Total Revenues, net of discounts | | | | | 228,530 | | | | | | 65,968 | | | | | | 246.4% | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Net Cash Provided by Operating Activities | | | | $ | 34,457 | | | | | $ | 24,930 | | |
Net Cash Used in Investing Activities | | | | | (86,743) | | | | | | (72,068) | | |
Net Cash Provided by Financing Activities | | | | | 92,805 | | | | | | 143,004 | | |
| | | Years ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Net Cash Provided by (Used in) Operating Activities | | | | $ | 182,872 | | | | | $ | 71,627 | | | | | $ | (6,660) | | |
Net Cash (Used in) Investing Activities | | | | | (455,832) | | | | | | (86,908) | | | | | | (84,118) | | |
Net Cash Provided by Financing Activities | | | | | 355,676 | | | | | | 25,266 | | | | | | 24,108 | | |
| | | Payments Due by Period | | |||||||||||||||||||||||||||
Contractual Obligations | | | Total | | | Less than 1 year | | | 1-2 years | | | 3-4 years | | | 5 years and after | | |||||||||||||||
Long Term Debt(1) | | | | $ | 289,924 | | | | | $ | 13,771 | | | | | $ | 265,867 | | | | | $ | 2,108 | | | | | $ | 8,178 | | |
Operating Leases | | | | $ | 89,541 | | | | | $ | 11,457 | | | | | $ | 21,372 | | | | | $ | 18,534 | | | | | $ | 38,178 | | |
Purchase Obligations(2) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Other Long Term Obligations(3) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Total Contractual Obligations | | | | $ | 379,465 | | | | | $ | 25,228 | | | | | $ | 287,239 | | | | | $ | 20,642 | | | | | $ | 46,356 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
ASSETS | | | | | | | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 139,637 | | | | | $ | — | | | | | $ | 139,637 | | |
Accounts Receivable, net | | | | | 17,676 | | | | | | — | | | | | | 17,676 | | |
Notes Receivable | | | | | — | | | | | | — | | | | | | — | | |
Inventory | | | | | 159,883 | | | | | | 3,898(a) | | | | | | 163,781 | | |
Prepaid Expenses and Other Current Assets | | | | | 22,583 | | | | | | — | | | | | | 22,583 | | |
Total Current Assets | | | | | 339,779 | | | | | | 3,898(a) | | | | | | 343,677 | | |
Property, Plant and Equipment, net | | | | | 479,747 | | | | | | — | | | | | | 479,747 | | |
Right Of Use Assets, net | | | | | 66,522 | | | | | | — | | | | | | 66,522 | | |
Intangible Assets, net | | | | | 1,368,358 | | | | | | — | | | | | | 1,368,358 | | |
Goodwill | | | | | 375,725 | | | | | | — | | | | | | 375,725 | | |
Investment in Associates | | | | | 7,396 | | | | | | — | | | | | | 7,396 | | |
Deposits and Other Assets | | | | | 2,514 | | | | | | — | | | | | | 2,514 | | |
TOTAL ASSETS | | | | $ | 2,640,041 | | | | | $ | 3,898(a) | | | | | $ | 2,643,939 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 61,050 | | | | | $ | — | | | | | $ | 61,050 | | |
Accrued Liabilities | | | | | 25,332 | | | | | | — | | | | | | 25,332 | | |
Income Tax Payable | | | | | 203,939 | | | | | | (20,116)(b)(d) | | | | | | 183,823 | | |
Current Portion of Lease Liabilities | | | | | 7,427 | | | | | | — | | | | | | 7,427 | | |
Current Portion of Notes Payable | | | | | 10,386 | | | | | | — | | | | | | 10,386 | | |
Acquisition Consideration Payable | | | | | 142,543 | | | | | | (4,760)(d) | | | | | | 137,783 | | |
Total Current Liabilities | | | | | 450,677 | | | | | | (24,876)(b)(d) | | | | | | 425,801 | | |
Long-Term Liabilities: | | | | | | | | | | | | | | | | | | | |
Deferred Revenue | | | | | 1,068 | | | | | | — | | | | | | 1,068 | | |
Notes Payable, net of Current Portion | | | | | 373,858 | | | | | | — | | | | | | 373,858 | | |
Lease Liabilities, net of Current Portion | | | | | 61,458 | | | | | | — | | | | | | 61,458 | | |
Deferred Income Taxes | | | | | 256,312 | | | | | | 2,659(b) | | | | | | 258,971 | | |
Total Long-Term Liabilities | | | | | 692,696 | | | | | | 2,659(b) | | | | | | 695,355 | | |
TOTAL LIABILITIES | | | | $ | 1,143,373 | | | | | $ | (22,217)(b)(d) | | | | | $ | 1,121,156 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,496,668 | | | | | | 26,115(a)(b)(d) | | | | | | 1,522,783 | | |
NON-CONTROLLING INTEREST | | | | | — | | | | | | — | | | | | | — | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,640,041 | | | | | $ | 3,898(a)(b) | | | | | $ | 2,643,939 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Revenues, net of discounts | | | | $ | 202,235 | | | | | $ | — | | | | | $ | 202,235 | | |
Cost of Goods Sold, net | | | | | 102,566 | | | | | | 1,052(a) | | | | | | 103,618 | | |
Gross Profit | | | | | 99,669 | | | | | | (1,052)(a) | | | | | | 98,617 | | |
Operating Expenses | | | | | 79,988 | | | | | | 9,572(a) | | | | | | 89,560 | | |
Income from Investments in Associates | | | | | 367 | | | | | | 1,638(b) | | | | | | 2,005 | | |
Income From Operations | | | | | 20,048 | | | | | | (8,986)(a)(b) | | | | | | 11,062 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | (990) | | | | | | — | | | | | | (990) | | |
Gain on Deconsolidation | | | | | 9,558 | | | | | | — | | | | | | 9,558 | | |
Gain on Previously Held Equity Interest | | | | | 17,275 | | | | | | (3,176)(b) | | | | | | 14,099 | | |
Other Income (Expense), net | | | | | (2,227) | | | | | | 4,761(d) | | | | | | 2,534 | | |
Interest Income (Expense), net | | | | | (10,672) | | | | | | — | | | | | | (10,672) | | |
Total Other Income (Expense) | | | | | 12,944 | | | | | | 1,587(d)(b) | | | | | | 14,530 | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 32,993 | | | | | | (7,401)(a)(d)(b) | | | | | | 25,592 | | |
Provision For Income Taxes | | | | | (42,833) | | | | | | 17,318(a)(b)(d) | | | | | | (25,515) | | |
Net Income (Loss) Before Non-Controlling Interest | | | | | (9,840) | | | | | | 9,917(a)(b)(d) | | | | | | 77 | | |
Net Income Attributable to Non-Controlling Interest | | | | | 291 | | | | | | — | | | | | | 291 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (10,131) | | | | | $ | 9,917(a)(b)(d) | | | | | $ | (214) | | |
Net Loss per share – basic | | | | | (0.03) | | | | | | 0.03(a)(b)(d) | | | | | | (0.00) | | |
Net Loss per share – diluted | | | | | (0.03) | | | | | | 0.03(a)(b)(d) | | | | | | (0.00) | | |
Basic – weighted average shares outstanding | | | | | 326,285,814 | | | | | | — | | | | | | 326,285,814 | | |
Diluted – weighted average shares outstanding | | | | | 326,285,814 | | | | | | — | | | | | | 326,285,814 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2022 | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,488,188 | | | | | $ | (12,404) | | | | | $ | 2,951 | | | | | $ | 1,478,735 | | |
Share-based compensation | | | | | — | | | | | | 771,337 | | | | | | 289 | | | | | | — | | | | | | — | | | | | | 289 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 1,403,067 | | | | | | 13,220 | | | | | | — | | | | | | — | | | | | | 13,220 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (3,242) | | | | | | (3,242) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 1,381,332 | | | | | | 17,506 | | | | | | — | | | | | | — | | | | | | 17,506 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (10,131) | | | | | | 291 | | | | | | (9,840) | | |
Balance as of March 31, 2022 | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,519,203 | | | | | $ | (22,535) | | | | | $ | — | | | | | $ | 1,496,668 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Adjustments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance at January 1, 2022 | | | | | — | | | | | | — | | | | | | 47,577 | | | | | | (42,831) | | | | | | (1,675) | | | | | | 3,071 | | |
Share-based compensation(a) | | | | | — | | | | | | — | | | | | | 11,453 | | | | | | — | | | | | | — | | | | | | 11,453 | | |
Noncontrolling interest adjustment for change in ownership(c) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,675 | | | | | | 1,675 | | |
Net Income(a)(b)(d) | | | | | — | | | | | | — | | | | | | — | | | | | | 9,917 | | | | | | — | | | | | | 9,917 | | |
Total Adjustments | | | | | — | | | | | | — | | | | | | 59,030 | | | | | | (32,914) | | | | | | — | | | | | | 26,116 | | |
As Restated | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 – As Restated | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
Share-based compensation | | | | | — | | | | | | 771,337 | | | | | | 11,742 | | | | | | — | | | | | | — | | | | | | 11,742 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 1,403,067 | | | | | | 13,220 | | | | | | — | | | | | | — | | | | | | 13,220 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,567) | | | | | | (1,567) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 1,381,332 | | | | | | 17,505 | | | | | | — | | | | | | — | | | | | | 17,505 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (214) | | | | | | 291 | | | | | | 77 | | |
Balance as of March 31, 2022 – As Restated | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,578,233 | | | | | $ | (55,449) | | | | | $ | — | | | | | $ | 1,522,783 | | |
|
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (10,131) | | | | | $ | 9,917(a)(b)(d) | | | | | $ | (214) | | |
Net income attributable to non-controlling interest | | | | | 291 | | | | | | — | | | | | | 291 | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 34,434 | | | | | | — | | | | | | 34,434 | | |
Non-cash interest expense | | | | | 674 | | | | | | — | | | | | | 674 | | |
Non-cash interest income | | | | | — | | | | | | — | | | | | | — | | |
Non-cash inventory step-up expense on acquisitions | | | | | 4,612 | | | | | | — | | | | | | 4,612 | | |
Loss on disposal of property, plant and equipment | | | | | 990 | | | | | | — | | | | | | 990 | | |
Gain on deconsolidation | | | | | (9,558) | | | | | | — | | | | | | (9,558) | | |
Gain on Disposal of Investments in Associates | | | | | (17,275) | | | | | | 3,176(b) | | | | | | (14,099) | | |
Bad debt expense | | | | | — | | | | | | — | | | | | | — | | |
Amortization of debt issuance costs | | | | | 1,514 | | | | | | — | | | | | | 1,514 | | |
Unrealized gain on marketable securities | | | | | (66) | | | | | | — | | | | | | (66) | | |
Write-off of note receivable | | | | | (3) | | | | | | — | | | | | | (3) | | |
Loss (Income) from underlying investees | | | | | 1,183 | | | | | | 1,638(c) | | | | | | (455) | | |
Loss on share issuance | | | | | 3,592 | | | | | | — | | | | | | 3,592 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Increase (Decrease) in fair value of contingent consideration | | | | | 2,293 | | | | | | (4,760)(d) | | | | | | (2,467) | | |
Stock based compensation | | | | | 289 | | | | | | 10,623(a) | | | | | | 10,912 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | — | | | | | | | | |
Accounts receivable | | | | | (269) | | | | | | — | | | | | | (269) | | |
Inventories | | | | | (26,595) | | | | | | — | | | | | | (26,595) | | |
Prepaid expenses and other current assets | | | | | 1,117 | | | | | | — | | | | | | 1,117 | | |
Deposits and other assets | | | | | 695 | | | | | | — | | | | | | 695 | | |
Accounts payable | | | | | 19,873 | | | | | | — | | | | | | 19,873 | | |
Accrued liabilities | | | | | (12,223) | | | | | | — | | | | | | (12,233) | | |
Lease Liabilities | | | | | (2,955) | | | | | | — | | | | | | (2,955) | | |
Income tax payable | | | | | 48,773 | | | | | | (20,778)(b)(d) | | | | | | 27,995 | | |
Deferred taxes | | | | | (6,672) | | | | | | 3,460(b) | | | | | | (3,212) | | |
Deferred revenue | | | | | (116) | | | | | | — | | | | | | (116) | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 34,457 | | | | | | — | | | | | | 34,457 | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (48,300) | | | | | | — | | | | | | (48,300) | | |
Proceeds from disposal of assets | | | | | 1,818 | | | | | | — | | | | | | 1,818 | | |
Advances to related parties | | | | | — | | | | | | — | | | | | | — | | |
Distributions to minority holders | | | | | — | | | | | | — | | | | | | — | | |
Purchases of intangible assets | | | | | — | | | | | | — | | | | | | — | | |
Acquisition of business, net of cash acquired | | | | | (60,082) | | | | | | — | | | | | | (60,082) | | |
Proceeds from sale deconsolidation and investment in Associates | | | | | 19,821 | | | | | | — | | | | | | 19,821 | | |
Purchase of interest in investment in associates | | | | | — | | | | | | — | | | | | | — | | |
Dividend received from investments in associates | | | | | — | | | | | | — | | | | | | — | | |
Issuance of note receivable | | | | | — | | | | | | — | | | | | | — | | |
Proceeds from note receivable | | | | | — | | | | | | — | | | | | | — | | |
Interest received on note receivable | | | | | — | | | | | | — | | | | | | — | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (86,743) | | | | | | — | | | | | | (86,743) | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | $ | 102,660 | | | | | $ | — | | | | | $ | 102,660 | | |
Principal repayments of notes payable | | | | | (6,870) | | | | | | — | | | | | | (6,870) | | |
Debt issuance costs paid | | | | | (2,985) | | | | | | — | | | | | | (2,985) | | |
Proceeds received from RTO financing | | | | | — | | | | | | — | | | | | | — | | |
Cash received in warrant private placement | | | | | — | | | | | | — | | | | | | — | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 92,805 | | | | | | — | | | | | | 92,805 | | |
NET INCREASE IN CASH | | | | | 40,519 | | | | | | — | | | | | | 40,519 | | |
CASH, BEGINNING OF PERIOD | | | | | 99,118 | | | | | | — | | | | | | 99,118 | | |
CASH, END OF PERIOD | | | | $ | 139,637 | | | | | $ | — | | | | | $ | 139,637 | | |
|
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | | | | | | | |
Interest paid | | | | $ | 9,999 | | | | | $ | — | | | | | $ | 9,999 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 541 | | | | | $ | — | | | | | $ | 541 | | |
Consideration received in stock for the disposal of assets | | | | $ | 3,776 | | | | | $ | — | | | | | $ | 3,776 | | |
Issuance of shares under business combinations | | | | $ | 27,135 | | | | | $ | — | | | | | $ | 27,135 | | |
Acquisitions | | | | | | | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 17,532 | | | | | $ | — | | | | | $ | 17,532 | | |
Liabilities assumed | | | | | (3,981) | | | | | | — | | | | | | (3,981) | | |
Acquisition consideration payable | | | | | 38,936 | | | | | | — | | | | | | 38,936 | | |
Goodwill | | | | | 7,595 | | | | | | — | | | | | | 7,595 | | |
| | | | $ | 60,082 | | | | | $ | — | | | | | $ | 60,082 | | |
Revenues, net of discounts | | | | $ | 120,895 | | | | | $ | — | | | | | $ | 120,895 | | |
Cost of Goods Sold, net | | | | | 66,605 | | | | | | — | | | | | | 66,605 | | |
Gross Profit | | | | | 54,290 | | | | | | — | | | | | | 54,290 | | |
Operating Expenses | | | | | 36,973 | | | | | | 5,692(a) | | | | | | 42,665 | | |
Income from Investments in Associates | | | | | 803 | | | | | | — | | | | | | 803 | | |
Income From Operations | | | | | 18,120 | | | | | | (5,692)(a) | | | | | | 12,428 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | — | | | | | | — | | | | | | — | | |
Gain on Deconsolidation | | | | | — | | | | | | — | | | | | | — | | |
Gain on Previously Held Equity Interest | | | | | — | | | | | | — | | | | | | — | | |
Other Income (Expense), net | | | | | (867) | | | | | | — | | | | | | (867) | | |
Interest Income (Expense), net | | | | | (1,767) | | | | | | — | | | | | | (1,767) | | |
Total Other Income (Expense) | | | | | (2,634) | | | | | | — | | | | | | (2,634) | | |
Net Income Before Provision for Income Taxes and Non-Controlling Interest | | | | | 15,486 | | | | | | (5,692)(a) | | | | | | 9,794 | | |
Provision For Income Taxes | | | | | (16,414) | | | | | | — | | | | | | (16,414) | | |
Net Loss Before Non-Controlling Interest | | | | | (928) | | | | | | (5,692)(a) | | | | | | (6,620) | | |
Net Income Attributable to Non-Controlling Interest | | | | | 1,266 | | | | | | — | | | | | | 1,266 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (2,194) | | | | | $ | (5,692)(a) | | | | | $ | (7,886) | | |
Net Loss per share – basic | | | | | (0.02) | | | | | | (0.01)(a) | | | | | | (0.03) | | |
Net Loss per share – diluted | | | | | (0.02) | | | | | | (0.01)(a) | | | | | | (0.03) | | |
Basic – weighted average shares outstanding | | | | | 140,952,177 | | | | | | 89,629,989(a) | | | | | | 230,582,166 | | |
Diluted – weighted average shares outstanding | | | | | 140,952,177 | | | | | | 89,629,989(a) | | | | | | 230,582,166 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2021 | | | | | 279,900,00 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,00) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Share-based compensation | | | | | — | | | | | | 61 | | | | | | — | | | | | | — | | | | | | 61 | | | | | | | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 3,199,219 | | | | | | 62,898 | | | | | | — | | | | | | — | | | | | | 62,898 | | |
Warrants issued and exercised | | | | | — | | | | | | — | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (2,194) | | | | | | 1,266 | | | | | | (928) | | |
Balance as of March 31, 2021 | | | | | | | | | | | 293,199,219 | | | | | $ | 1,023,609 | | | | | $ | 7,053 | | | | | $ | 7,503 | | | | | $ | 1,038,166 | | |
Adjustments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance at January 1, 2021 | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Share-based compensation(a) | | | | | — | | | | | | — | | | | | | 6,553 | | | | | | — | | | | | | — | | | | | | 6,553 | | |
Distributions to minority holders(c) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Net Loss(a)(b) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,692) | | | | | | — | | | | | | (5,692) | | |
Total Adjustments | | | | | — | | | | | | — | | | | | | 6,553 | | | | | | (5,692) | | | | | | (100) | | | | | | 761 | | |
As Restated | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 – As Restated | | | | | 279,900,00 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,00) | | | | | | — | | | | | | | | | | | | | | | | | | | | | | | | | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority holders | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 6,614 | | | | | | — | | | | | | — | | | | | | 6,614 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 3,199,219 | | | | | | 62,898 | | | | | | — | | | | | | — | | | | | | 62,898 | | |
Warrants issued and exercised | | | | | — | | | | | | — | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (7,886) | | | | | | 1,266 | | | | | | (6,620) | | |
Balance as of March 31, 2021 – As Restated | | | | | | | | | | | 293,199,219 | | | | | $ | 1,030,163 | | | | | $ | 1,361 | | | | | $ | 7,403 | | | | | $ | 1,038,927 | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (2,194) | | | | | $ | (5,692)(a)(b) | | | | | $ | (7,886) | | |
Net income attributable to non-controlling interest | | | | | 1,266 | | | | | | — | | | | | | 1,266 | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 11,783 | | | | | | — | | | | | | 11,783 | | |
Non-cash interest expense | | | | | 357 | | | | | | — | | | | | | 357 | | |
Non-cash interest income | | | | | (237) | | | | | | — | | | | | | (237) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 17,844 | | | | | | — | | | | | | 17,844 | | |
Loss on disposal of property, plant and equipment | | | | | — | | | | | | — | | | | | | — | | |
Gain on deconsolidation | | | | | — | | | | | | — | | | | | | — | | |
Gain on Disposal of Investments in Associates | | | | | — | | | | | | — | | | | | | — | | |
Bad debt expense | | | | | 68 | | | | | | — | | | | | | 68 | | |
Amortization of debt issuance costs | | | | | 136 | | | | | | — | | | | | | 136 | | |
Unrealized gain on marketable securities | | | | | — | | | | | | — | | | | | | — | | |
Write-off of note receivable | | | | | — | | | | | | — | | | | | | — | | |
Loss (Income) from underlying investees | | | | | (6,802) | | | | | | 100(c) | | | | | | (6,702) | | |
Loss (Income) on share issuance | | | | | (125) | | | | | | — | | | | | | (125) | | |
Decrease in fair value of contingent consideration | | | | | — | | | | | | — | | | | | | — | | |
Stock based compensation | | | | | 61 | | | | | | 5,692(a) | | | | | | 5,752 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | — | | | | | | | | |
Accounts receivable | | | | | (6,131) | | | | | | — | | | | | | (6,131) | | |
Inventories | | | | | (19,239) | | | | | | — | | | | | | (19,239) | | |
Prepaid expenses and other current assets | | | | | (5,522) | | | | | | — | | | | | | (5,522) | | |
Deposits and other assets | | | | | 1,071 | | | | | | — | | | | | | 1,071 | | |
Accounts payable | | | | | 10,942 | | | | | | — | | | | | | 10,942 | | |
Accrued liabilities | | | | | 1,827 | | | | | | — | | | | | | 1,827 | | |
Lease Liabilities | | | | | (1,217) | | | | | | — | | | | | | (1,217) | | |
Income tax payable | | | | | 21,940 | | | | | | 240(b) | | | | | | 22,180 | | |
Deferred taxes | | | | | — | | | | | | (240)(b) | | | | | | (240) | | |
Deferred revenue | | | | | (997) | | | | | | — | | | | | | (997) | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 24,831 | | | | | | 100(a)(b)(c) | | | | | | 24,930 | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (36,402) | | | | | | — | | | | | | (36,402) | | |
Proceeds from disposal of assets | | | | | 734 | | | | | | — | | | | | | 734 | | |
Advances to related parties | | | | | 20 | | | | | | — | | | | | | 20 | | |
Distributions to minority holders | | | | | — | | | | | | (100)(c) | | | | | | (100) | | |
Purchases of intangible assets | | | | | (7,460) | | | | | | — | | | | | | (7,460) | | |
Acquisition of business, net of cash acquired | | | | | (38,573) | | | | | | — | | | | | | (38,573) | | |
Proceeds from sale deconsolidation and investment in Associates | | | | | — | | | | | | — | | | | | | — | | |
Purchase of interest in investment in associates | | | | | (3,350) | | | | | | — | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | 10,275 | | | | | | — | | | | | | 10,275 | | |
Issuance of note receivable | | | | | (147) | | | | | | — | | | | | | (147) | | |
Proceeds from note receivable | | | | | 2,931 | | | | | | — | | | | | | 2,931 | | |
Interest received on note receivable | | | | | 4 | | | | | | — | | | | | | 4 | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (71,969) | | | | | | (100)(c) | | | | | | (72,068) | | |
|
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | | — | | | | | | — | | | | | | — | | |
Principal repayments of notes payable | | | | | (7,516) | | | | | | — | | | | | | (7,516) | | |
Debt issuance costs paid | | | | | — | | | | | | — | | | | | | — | | |
Proceeds received from RTO financing | | | | | 75,420 | | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | 75,100 | | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 143,004 | | | | | | — | | | | | | 143,004 | | |
NET INCREASE IN CASH | | | | | 95,866 | | | | | | — | | | | | | 95,866 | | |
CASH, BEGINNING OF PERIOD | | | | | 16,402 | | | | | | — | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 112,268 | | | | | $ | — | | | | | $ | 112,268 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | | | | | | | |
Interest paid | | | | $ | 1,648 | | | | | $ | — | | | | | $ | 1,648 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 1,200 | | | | | $ | — | | | | | $ | 1,200 | | |
Consideration received in stock for the disposal of assets | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Issuance of shares under business combinations | | | | $ | 690,109 | | | | | $ | — | | | | | $ | 690,109 | | |
Acquisitions | | | | | | | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 787,405 | | | | | $ | — | | | | | $ | 787,405 | | |
Liabilities assumed | | | | | (215,083) | | | | | | — | | | | | | (215,083) | | |
Acquisition consideration payable | | | | | (731,059) | | | | | | — | | | | | | (731,059) | | |
Goodwill | | | | | 197,310 | | | | | | — | | | | | | 197,310 | | |
| | | | $ | 38,573 | | | | | $ | — | | | | | $ | 38,573 | | |
|
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Raw Materials | | | | $ | 8,187$ | | | | | | 5,767 | | |
Work in Process | | | | | 114,470 | | | | | | 96,367 | | |
Finished Goods | | | | | 41,124 | | | | | | 38,569 | | |
Total Inventories | | | | $ | 163,781$ | | | | | | 140,703 | | |
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
Land | | | | $ | 28,413 | | | | | $ | 29,399 | | |
Buildings and Improvements | | | | | 154,765 | | | | | | 126,020 | | |
Furniture and Fixtures | | | | | 13,886 | | | | | | 13,259 | | |
Computer Equipment and Software | | | | | 15,715 | | | | | | 14,078 | | |
Leasehold Improvements | | | | | 176,845 | | | | | | 182,514 | | |
Tools and Equipment | | | | | 71,189 | | | | | | 65,774 | | |
Vehicles | | | | | 4,091 | | | | | | 3,229 | | |
Assets Under Construction(1) | | | | | 70,231 | | | | | | 64,107 | | |
Total Property, Plant and Equipment, Gross | | | | | 535,135 | | | | | | 498,380 | | |
Less: Accumulated Depreciation | | | | | (55,388 | | | | | | (46,148 | | |
Property, Plant and Equipment, Net | | | | $ | 479,747 | | | | | $ | 452,232 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | $ | 1,386,131 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,451,900 | | |
Purchases | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Additions from business combination | | | | | 13,281 | | | | | | — | | | | | | — | | | | | | 13,281 | | |
Adjustments to purchase price allocation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Disposals | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Balance as of March 31, 2022 | | | | $ | 1,399,412 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,465,181 | | |
Accumulated Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 66,703 | | | | | | 4,158 | | | | | | 1,126 | | | | | | 71,987 | | |
Amortization | | | | | 23,173 | | | | | | 1,355 | | | | | | 308 | | | | | | 24,836 | | |
Balance as of March 31, 2022 | | | | $ | 89,876 | | | | | $ | 5,513 | | | | | $ | 1,434 | | | | | $ | 96,823 | | |
Net Book Value | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 1,319,428 | | | | | | 50,008 | | | | | | 10,477 | | | | | | 1,379,913 | | |
Balance as of March 31, 2022 | | | | $ | 1,309,536 | | | | | $ | 48,653 | | | | | $ | 10,169 | | | | | $ | 1,368,358 | | |
Year Ending December 31: | | | Estimated Amortization | | | |||||
2022 (Remaining) | | | | $ | 74,961 | | | | ||
2023 | | | | | 99,948 | | | | ||
2024 | | | | | 99,948 | | | | ||
2025 | | | | | 99,948 | | | | ||
2026 | | | | | 99,221 | | | | ||
Thereafter | | | | | 894,332 | | | | ||
| | | | $ | 1,368,358 | | | | | |
| | | January 1, 2022 | | | Impairment | | | Adjustments to purchase price allocation | | | Acquisitions | | | March 31, 2022 | | |||||||||||||||
Cultivation | | | | $ | 91,116 | | | | | $ | — | | | | | $ | 1,050 | | | | | $ | — | | | | | $ | 92,166 | | |
Retail | | | | | 277,014 | | | | | | — | | | | | | — | | | | | | 6,545 | | | | | | 283,559 | | |
Total | | | | $ | 368,130 | | | | | $ | — | | | | | $ | 1,050 | | | | | $ | 6,545 | | | | | $ | 375,725 | | |
| | | Three Months Ended March 31, 2022 | | | Three Months Ended March 31, 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Numerator | | | | ||||||||||
Net Loss attributable to Verano Holdings Corp. | | | | $ | (214) | | | | | $ | (7,886) | | |
Denominator | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | 158,203,932 | | | | | | | | |
Post-RTO weighted-average shares outstanding | | | | | 291,143,545 | | | | | | | | |
Weighted-average shares outstanding – basic | | | | | 326,285,814 | | | | | | 230,582,166 | | |
Diluted | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | 158,203,932 | | | | | | | | |
Post-RTO weighted-average shares outstanding | | | | | 291,143,545 | | | | | | | | |
Weighted-average shares outstanding – basic | | | | | 326,285,814 | | | | | | 230,582,166 | | |
Basic earnings per share | | | | $ | (0.00) | | | | | $ | (0.03) | | |
Diluted earnings per share | | | | $ | (0.00) | | | | | $ | (0.03) | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
Cash | | | | $ | 5,446 | | | | | $ | 507 | | | | | $ | 5,953 | | |
Accounts receivable, net | | | | | 60 | | | | | | 498 | | | | | | 558 | | |
Inventory | | | | | 83,205 | | | | | | 5,827 | | | | | | 89,032 | | |
Prepaids and other current assets | | | | | 833 | | | | | | 1,989 | | | | | | 2,822 | | |
Property, plant and equipment, net | | | | | 73,386 | | | | | | 9,751 | | | | | | 83,137 | | |
Right-of-use asset, net | | | | | 9,651 | | | | | | — | | | | | | 9,651 | | |
Other assets | | | | | 1,001 | | | | | | — | | | | | | 1,001 | | |
Accounts payable and accrued liabilities | | | | | (8,935) | | | | | | (2,576) | | | | | | (11,511) | | |
Notes payable | | | | | (3,579) | | | | | | (3,343) | | | | | | (6,922) | | |
Deferred taxes | | | | | (123,720) | | | | | | (37,290) | | | | | | (161,010) | | |
Lease liabilities | | | | | (9,651) | | | | | | — | | | | | | (9,651) | | |
Total identifiable net assets (liabilities) | | | | | 27,697 | | | | | | (24,637) | | | | | | 3,060 | | |
Intangible assets | | | | | 498,938 | | | | | | 184,588 | | | | | | 683,526 | | |
Net assets | | | | $ | 526,635 | | | | | $ | 159,951 | | | | | $ | 686,586 | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
License | | | | $ | 319,928 | | | | | $ | 130,670 | | | | | $ | 450,598 | | |
Tradename | | | | | 36,278 | | | | | | 8,980 | | | | | | 45,258 | | |
Technology | | | | | 10,603 | | | | | | 885 | | | | | | 11,488 | | |
Total intangible assets | | | | $ | 366,809 | | | | | $ | 140,536 | | | | | $ | 507,344 | | |
Goodwill (residual purchase price) | | | | $ | 8,409 | | | | | $ | 6,763 | | | | | $ | 15,172 | | |
Goodwill (deferred taxes)(a) | | | | | 123,720 | | | | | | 37,290 | | | | | | 161,010 | | |
Total goodwill | | | | $ | 132,129 | | | | | $ | 44,053 | | | | | $ | 176,182 | | |
| | | Consolidated Results | | | AltMed Pre-acquisition | | | Pro-forma Results | | |||||||||
Revenues, net of discounts | | | | | 120,895 | | | | | | 22,402 | | | | | | 143,297 | | |
Net income (loss) | | | | | (7,886) | | | | | | 10,933 | | | | | | 3,047 | | |
| | | Greengate | | |||
Cash and cash equivalents | | | | $ | 2,315 | | |
Inventory | | | | | 1,021 | | |
Prepaid & other current Assets | | | | | 324 | | |
Deposits and Other non-current assets | | | | | 45 | | |
Property, plant and equipment, net | | | | | 1,673 | | |
Right-of-use asset, Net | | | | | 1,836 | | |
Accounts payable and accrued liabilities | | | | | (1,569) | | |
Other liabilities | | | | | (72) | | |
Lease liabilities | | | | | (1,836) | | |
Total identifiable net assets (liabilities) | | | | | 3,737 | | |
Total Intangible assets | | | | | 19,826 | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 86,813 | | | | | $ | 32,123 | | | | | $ | 1,959 | | | | | $ | 120,895 | | |
Net income (loss) | | | | | (2,113) | | | | | | (5,391) | | | | | | (382) | | | | | | (7,886) | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 86,813 | | | | | $ | 54,525 | | | | | $ | 11,611 | | | | | $ | 152,949 | | |
Net income (loss) | | | | | (2,113) | | | | | | 5,541 | | | | | | 2,297 | | | | | | 5,725 | | |
| | | As of | | |||||||||
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
Credit Facility | | | | $ | 350,000 | | | | | $ | 250,000 | | |
Secured Promissory Notes | | | | | 1,687 | | | | | | 6,663 | | |
Mortgage Loans | | | | | 39,084 | | | | | | 38,856 | | |
Vehicle and Equipment Loans | | | | | 2,489 | | | | | | 1,951 | | |
Unamortized debt issuance costs | | | | | (9,016) | | | | | | (7,545) | | |
Total notes payable | | | | $ | 384,244 | | | | | $ | 289,925 | | |
Less: current portion of notes payable | | | | | 10,386 | | | | | | 13,771 | | |
Total long-term debt, net | | | | $ | 373,858 | | | | | $ | 276,154 | | |
| | | Number of Shares | | | Weighted Avg. Exercise Price C$ | | | Weighted Average Remaining Contractual Life | | |||||||||
Balance as of December 31, 2021 | | | | | 56,078 | | | | | | 29.97 | | | | | | 9.16 | | |
Vested | | | | | 18,798 | | | | | | 29.97 | | | | | | | | |
Exercisable at March 31, 2022 | | | | | 24,167 | | | | | | 29.97 | | | | | | 8.92 | | |
| | | Number of Shares | | | Weighted Avg. Grant Date Fair Value C$ | | ||||||
Unvested Shares at December 31, 2021 | | | | | 2,413,887 | | | | | | 29.98 | | |
Granted | | | | | 243,710 | | | | | | 16.30 | | |
Forfeited | | | | | 975 | | | | | | 23.30 | | |
Vested | | | | | 1,179,961 | | | | | | 30.31 | | |
Unvested Shares at March 31, 2022 | | | | | 1,476,661 | | | | | | 27.75 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Weighted average grant date fair value (per share) of RSUs granted (C$) | | | | | 16.30 | | | | | | 30.11 | | |
Intrinsic value of RSUs vested, using market price at vest date (C$) (in thousands) | | | | | 15.41 | | | | | | — | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Stock Options Expense | | | | $ | 63 | | | | | $ | 53 | | |
Restricted Stock Units | | | | | 10,850 | | | | | | 5,699 | | |
Total Stock Based Compensation Expense | | | | $ | 10,913 | | | | | $ | 5,752 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Income before Income Taxes | | | | $ | 25,592 | | | | | $ | 9,794 | | |
Income Tax Expense | | | | | (25,515) | | | | | | (16,414) | | |
Effective Tax Rate | | | | | 86.8% | | | | | | 173.0% | | |
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
Weighted average remaining lease term (years) | | | | | 8.18 | | | | | | 8.52 | | |
Weighted average discount rate | | | | | 8.03% | | | | | | 8.11% | | |
Year Ending December 31, | | | | | | | |
Remainder 2022 | | | | | 9,295 | | |
2023 | | | | | 11,873 | | |
2024 | | | | | 11,274 | | |
2025 | | | | | 10,318 | | |
2026 | | | | | 9,416 | | |
2027 and Thereafter | | | | | 41,733 | | |
Total Lease Payments | | | | | 93,909 | | |
Less: Interest | | | | | (25,024) | | |
Present Value of Lease Liability | | | | | 68,885 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Revenue, net of discounts | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 53,008 | | | | | $ | 49,161 | | |
Retail | | | | | 164,334 | | | | | | 79,195 | | |
Intersegment Eliminations | | | | | (15,107) | | | | | | (7,461) | | |
Total Revenue, net of discounts | | | | | 202,235 | | | | | | 120,895 | | |
Depreciation and Amortization | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 19,725 | | | | | | 8,320 | | |
Retail | | | | | 14,709 | | | | | | 3,463 | | |
Total Depreciation and Amortization | | | | | 34,434 | | | | | | 11,783 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Income taxes | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 11,237 | | | | | | 3,696 | | |
Retail | | | | | 14,278 | | | | | | 12,718 | | |
Total Income Taxes | | | | | 25,515 | | | | | | 16,414 | | |
|
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
| | | (Unaudited) | | | (As Restated) | | ||||||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and Cash Equivalents | | | | $ | 92,833 | | | | | $ | 99,118 | | |
Accounts Receivable, net | | | | | 13,253 | | | | | | 17,410 | | |
Notes Receivable | | | | | — | | | | | | 285 | | |
Inventory | | | | | 154,050 | | | | | | 140,703 | | |
Prepaid Expenses and Other Current Assets | | | | | 27,820 | | | | | | 19,528 | | |
Total Current Assets | | | | | 287,956 | | | | | | 277,044 | | |
Property, Plant and Equipment, net | | | | | 515,698 | | | | | | 452,232 | | |
Right of Use Assets, net | | | | | 71,472 | | | | | | 61,346 | | |
Intangible Assets, net | | | | | 1,343,371 | | | | | | 1,379,913 | | |
Goodwill | | | | | 376,637 | | | | | | 368,130 | | |
Investment in Associates | | | | | 7,252 | | | | | | 7,491 | | |
Deposits and Other Assets | | | | | 2,584 | | | | | | 2,499 | | |
TOTAL ASSETS | | | | $ | 2,604,970 | | | | | $ | 2,548,655 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 60,832 | | | | | $ | 45,172 | | |
Accrued Liabilities | | | | | 30,773 | | | | | | 42,149 | | |
Income Tax Payable | | | | | 161,430 | | | | | | 154,512 | | |
Current Portion of Lease Liabilities | | | | | 7,961 | | | | | | 6,563 | | |
Current Portion of Notes Payable | | | | | 258,880 | | | | | | 13,771 | | |
Acquisition Consideration Payable | | | | | 66,901 | | | | | | 208,349 | | |
Total Current Liabilities | | | | | 586,777 | | | | | | 470,516 | | |
Long-Term Liabilities: | | | | | | | | | | | | | |
Deferred Revenue | | | | | 271 | | | | | | 1,183 | | |
Notes Payable, net of Current Portion | | | | | 143,749 | | | | | | 276,154 | | |
Lease Liabilities, net of Current Portion | | | | | 66,122 | | | | | | 56,812 | | |
Deferred Income Taxes | | | | | 259,326 | | | | | | 262,184 | | |
Total Long-Term Liabilities | | | | | 469,468 | | | | | | 596,333 | | |
TOTAL LIABILITIES | | | | $ | 1,056,245 | | | | | $ | 1,066,849 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,548,725 | | | | | | 1,480,530 | | |
NON-CONTROLLING INTEREST | | | | | — | | | | | | 1,276 | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,604,970 | | | | | $ | 2,548,655 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Revenues, net of Discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | $ | 425,897 | | | | | $ | 319,961 | | |
Cost of Goods Sold, net | | | | | 125,547 | | | | | | 129,856 | | | | | | 229,165 | | | | | | 196,461 | | |
Gross Profit | | | | | 98,115 | | | | | | 69,210 | | | | | | 196,732 | | | | | | 123,500 | | |
Selling, General, and Administrative Expenses | | | | | 100,263 | | | | | | 70,013 | | | | | | 189,824 | | | | | | 112,679 | | |
Income (Loss) from Investments in Associates | | | | | (144) | | | | | | 645 | | | | | | 1,860 | | | | | | 1,448 | | |
Income (Loss) from Operations | | | | | (2,292) | | | | | | (158) | | | | | | 8,768 | | | | | | 12,269 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | (203) | | | | | | (429) | | | | | | (1,192) | | | | | | (429) | | |
Gain (Loss) on Deconsolidation | | | | | (73) | | | | | | — | | | | | | 9,485 | | | | | | — | | |
Gain (Loss) on Previously Held Equity Interest | | | | | (171) | | | | | | — | | | | | | 13,928 | | | | | | — | | |
Interest Expense, net | | | | | (11,624) | | | | | | (5,434) | | | | | | (22,295) | | | | | | (7,201) | | |
Other Income (Expense), net | | | | | 15,619 | | | | | | (131) | | | | | | 18,153 | | | | | | (997) | | |
Total Other Income (Expense) | | | | | 3,548 | | | | | | (5,994) | | | | | | 18,079 | | | | | | (8,627) | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 1,256 | | | | | | (6,152) | | | | | | 26,847 | | | | | | 3,642 | | |
Provision For Income Taxes | | | | | (11,103) | | | | | | (23,438) | | | | | | (36,617) | | | | | | (39,852) | | |
Net Loss Before Non-Controlling Interest | | | | | (9,847) | | | | | | (29,590) | | | | | | (9,770) | | | | | | (36,210) | | |
Net Income Attributable to Non-Controlling Interest | | | | | — | | | | | | 98 | | | | | | 291 | | | | | | 1,364 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (9,847) | | | | | $ | (29,688) | | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Net Loss per share – basic | | | | | (0.03) | | | | | | (0.10) | | | | | | (0.03) | | | | | | (0.14) | | |
Net Loss per share – diluted | | | | | (0.03) | | | | | | (0.10) | | | | | | (0.03) | | | | | | (0.14) | | |
Basic – weighted average shares outstanding | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Diluted – weighted average shares outstanding | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
| | | Consolidated VIE | | | Consolidated VOE | | | Consolidated VIE | | | Consolidated VOE | | | | ||||||||||||||||
| | | March 31, 2022 | | | December 31, 2021 | | | | ||||||||||||||||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||||||||||||||
Current Assets | | | | $ | 47,572 | | | | | $ | 18,244 | | | | | $ | 43,045 | | | | | $ | 20,464 | | | | | ||||
Due To/(From) | | | | | (33,082) | | | | | | (6,084) | | | | | | (25,723) | | | | | | 14,228 | | | | | ||||
Non-Current Assets | | | | | 205,503 | | | | | | 245,293 | | | | | | 207,908 | | | | | | 226,108 | | | | | ||||
Current Liabilities | | | | | 34,576 | | | | | | 12,358 | | | | | | 32,934 | | | | | | 22,659 | | | | | ||||
Non-Current Liabilities | | | | | 42,552 | | | | | | 45,438 | | | | | | 45,873 | | | | | | 45,603 | | | | | ||||
Non-controlling Interest | | | | | — | | | | | | — | | | | | | 1,276 | | | | | | — | | | | | ||||
Equity attributable to Verano Holdings, Corp. | | | | | 142,865 | | | | | | 199,657 | | | | | | 145,147 | | | | | | 192,538 | | | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of April 1, 2021 (As Restated) | | | | | — | | | | | | 293,199,219 | | | | | $ | 1,030,163 | | | | | $ | 1,361 | | | | | $ | 7,403 | | | | | $ | 1,038,927 | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 14,483 | | | | | | — | | | | | | — | | | | | | 14,483 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 10,410,187 | | | | | | 207,136 | | | | | | — | | | | | | — | | | | | | 207,136 | | |
Issuance of warrants | | | | | — | | | | | | 3,510,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 103,775 | | | | | | 2,085 | | | | | | — | | | | | | — | | | | | | 2,085 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (29,688) | | | | | | 98 | | | | | | (29,590) | | |
Balance as of June 30, 2021 | | | | | — | | | | | | 307,223,181 | | | | | $ | 1,253,867 | | | | | $ | (28,327) | | | | | $ | 7,501 | | | | | $ | 1,233,041 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of April 1, 2022 (As Restated) | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,578,232 | | | | | $ | (55,449) | | | | | $ | — | | | | | $ | 1,522,783 | | |
Share-based compensation | | | | | — | | | | | | 26,570 | | | | | | 12,523 | | | | | | — | | | | | | — | | | | | | 12,523 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 808,258 | | | | | | 5,540 | | | | | | — | | | | | | — | | | | | | 5,540 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 2,115,438 | | | | | | 17,726 | | | | | | — | | | | | | — | | | | | | 17,726 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (9,847) | | | | | | — | | | | | | (9,847) | | |
Balance as of June 30, 2022 | | | | | — | | | | | | 330,818,664 | | | | | $ | 1,614,021 | | | | | $ | (65,296) | | | | | $ | — | | | | | $ | 1,548,725 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2021 | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,000) | | | | | | 279,900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority members | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 21,097 | | | | | | — | | | | | | — | | | | | | 21,097 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 13,609,406 | | | | | | 270,034 | | | | | | — | | | | | | — | | | | | | 270,034 | | |
Warrants issued and exercised | | | | | — | | | | | | 3,510,000 | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 103,775 | | | | | | 2,085 | | | | | | — | | | | | | — | | | | | | 2,085 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (37,574) | | | | | | 1,364 | | | | | | (36,210) | | |
Balance as of June 30, 2021 | | | | | — | | | | | | 307,223,181 | | | | | $ | 1,253,867 | | | | | $ | (28,327) | | | | | $ | 7,501 | | | | | $ | 1,233,041 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2022 (As Restated) | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
Share-based compensation | | | | | — | | | | | | 797,907 | | | | | | 24,265 | | | | | | — | | | | | | — | | | | | | 24,265 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 2,211,325 | | | | | | 18,760 | | | | | | — | | | | | | — | | | | | | 18,760 | | |
Non-controlling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,567) | | | | | | (1,567) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 3,496,770 | | | | | | 35,231 | | | | | | — | | | | | | — | | | | | | 35,231 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (10,061) | | | | | | 291 | | | | | | (9,770) | | |
Balance as of June 30, 2022 | | | | | — | | | | | | 330,818,664 | | | | | $ | 1,614,021 | | | | | $ | (65,296) | | | | | $ | — | | | | | $ | 1,548,725 | | |
| | | As of March 31, 2022 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
(As Restated) | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and Cash Equivalents | | | | $ | 139,637 | | | | | $ | — | | | | | $ | — | | | | | $ | 139,637 | | |
Investments | | | | | 3,842 | | | | | | — | | | | | | — | | | | | | 3,842 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (137,783) | | | | | | (137,783) | | |
Total | | | | $ | 143,479 | | | | | $ | — | | | | | $ | (137,783) | | | | | $ | 5,696 | | |
| | | As of December 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 99,118 | | | | | $ | — | | | | | $ | — | | | | | $ | 99,118 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (208,349) | | | | | | (208,349) | | |
Total | | | | $ | 99,118 | | | | | $ | — | | | | | $ | (208,349) | | | | | $ | (109,231) | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Net income attributable to non-controlling interest | | | | | 291 | | | | | | 1,364 | | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 69,911 | | | | | | 36,057 | | |
Non-cash interest expense | | | | | 1,016 | | | | | | 2,907 | | |
Non-cash interest income | | | | | — | | | | | | (17) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 6,707 | | | | | | 52,189 | | |
Loss on disposal of property, plant and equipment | | | | | 1,192 | | | | | | 429 | | |
Gain on deconsolidation | | | | | (9,485) | | | | | | — | | |
Gain on disposal of investments in associates | | | | | (13,928) | | | | | | — | | |
Bad debt expense | | | | | — | | | | | | 68 | | |
Amortization of debt issuance costs | | | | | 3,160 | | | | | | 517 | | |
Unrealized gain on marketable securities | | | | | 2,148 | | | | | | — | | |
Loss (income) from underlying investees | | | | | (310) | | | | | | (7,319) | | |
Stock earnout from acquisitions | | | | | — | | | | | | 2,084 | | |
Loss (income) on share issuance | | | | | (4,650) | | | | | | 1,236 | | |
Decrease in fair value of contingent consideration | | | | | (9,102) | | | | | | — | | |
Stock based compensation | | | | | 24,405 | | | | | | 18,333 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | |
Accounts receivable | | | | | 4,157 | | | | | | (900) | | |
Inventory | | | | | (19,927) | | | | | | (23,023) | | |
Prepaid expenses and other current assets | | | | | (6,333) | | | | | | 138 | | |
Deposits and other assets | | | | | 4,384 | | | | | | 2,935 | | |
Accounts payable | | | | | 14,686 | | | | | | (9,242) | | |
Accrued liabilities | | | | | (9,880) | | | | | | (10,668) | | |
Lease liabilities | | | | | (6,468) | | | | | | (2,383) | | |
Income tax payable | | | | | 5,508 | | | | | | 31,536 | | |
Deferred taxes | | | | | (2,857) | | | | | | (531) | | |
Deferred revenue | | | | | (913) | | | | | | (1,305) | | |
Other, net | | | | | (3) | | | | | | 14 | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 43,648 | | | | | | 56,845 | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (86,851) | | | | | | (61,785) | | |
Proceeds from disposal of assets | | | | | 1,841 | | | | | | 778 | | |
Distributions to minority members | | | | | — | | | | | | (100) | | |
Purchases of intangible assets | | | | | — | | | | | | (8,378) | | |
Acquisition of business, net of cash acquired | | | | | (94,042) | | | | | | (102,138) | | |
| | | For the Year Ended December 31, 2021 | | |||||||||||||||||||||||||||
($ in Thousands) | | | Verano Holdings Corp. | | | AME Group Pre-Acquisition | | | Pro Forma Adjustments | | | | | | | | | Pro Forma Combined | | ||||||||||||
Revenues, net of discounts | | | | | 737,850 | | | | | | 22,402 | | | | | | | | | | | | | | | | | | 760,252 | | |
Cost of Goods Sold | | | | | 406,831 | | | | | | 8,087 | | | | | | (68,934) | | | | | | a | | | | | | 345,984 | | |
Gross Profit | | | | | 331,019 | | | | | | 14,315 | | | | | | 68,934 | | | | | | | | | | | | 414,268 | | |
Total Operating Expenses | | | | | 270,929 | | | | | | 3,299 | | | | | | 377 | | | | | | b | | | | | | 275,395 | | |
Other Income (Expense) | | | | | (117,597) | | | | | | (83) | | | | | | | | | | | | | | | | | | (117,680) | | |
Net Income (Loss) | | | | | (57,507) | | | | | | 10,933 | | | | | | 68,557 | | | | | | c | | | | | | 21,983 | | |
Net Income (Loss) per share – basic | | | | | (0.20) | | | | | | — | | | | | | | | | | | | | | | | | | 0.06 | | |
Net Income (Loss) per share – diluted | | | | | (0.20) | | | | | | — | | | | | | | | | | | | | | | | | | 0.06 | | |
Weighted average number of shares – basic | | | | | 290,443,432 | | | | | | 65,191,388 | | | | | | | | | | | | | | | | | | 355,634,820 | | |
Weighted average number of shares – diluted | | | | | 290,443,432 | | | | | | 65,191,388 | | | | | | | | | | | | | | | | | | 364,353,560 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Proceeds from sale of deconsolidation and investment in associates | | | | | 19,576 | | | | | | — | | |
Purchase of interest in investment in associates | | | | | — | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | — | | | | | | 10,275 | | |
Proceeds from note receivable | | | | | — | | | | | | 4,215 | | |
Other, net | | | | | — | | | | | | 41 | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (159,476) | | | | | | (160,442) | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | | 120,774 | | | | | | 100,000 | | |
Principal repayments of notes payable | | | | | (8,245) | | | | | | (8,527) | | |
Debt issuance costs paid | | | | | (2,986) | | | | | | (5,132) | | |
Proceeds received from RTO Financing, net | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 109,543 | | | | | | 236,861 | | |
NET INCREASE (DECREASE) IN CASH | | | | | (6,285) | | | | | | 133,264 | | |
CASH, BEGINNING OF PERIOD | | | | | 99,118 | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 92,833 | | | | | $ | 149,666 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | |
Interest paid | | | | $ | 10,608 | | | | | $ | 1,761 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 3,296 | | | | | $ | 3,627 | | |
Issuance of shares under business combinations | | | | $ | 53,950 | | | | | $ | 896,795 | | |
Acquisitions | | | | | | | | | | | | | |
Tangible and intangible assets acquired, net of cash | | | | $ | 17,533 | | | | | $ | 1,127,009 | | |
Liabilities assumed | | | | | (4,362) | | | | | | (249,094) | | |
Acquisition consideration payable | | | | | 72,364 | | | | | | (1,038,668) | | |
Goodwill | | | | | 8,507 | | | | | | 262,891 | | |
| | | | $ | 94,042 | | | | | $ | 102,138 | | |
|
| | | For the Three Months Ended March 31, | | | 2022 – 2021 | | ||||||||||||
| | ||||||||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Revenue, net of discounts | | | | $ | 202,235 | | | | | $ | 120,895 | | | | | $ | 81,340 | | |
Gross Profit | | | | | 98,617 | | | | | | 54,290 | | | | | | 44,327 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (214) | | | | | | (7,886) | | | | | | 7,672 | | |
Net Loss per share – basic | | | | | (0.00) | | | | | | (0.03) | | | | | | 0.03 | | |
Net Loss per share – diluted | | | | | (0.00) | | | | | | (0.03) | | | | | | 0.03 | | |
($ in thousands) | | | March 31, 2022 | | | December 31, 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Total Assets | | | | $ | 2,643,939 | | | | | $ | 2,548,655 | | |
Long-Term Liabilities | | | | | 695,355 | | | | | | 596,333 | | |
| | | For the Three Months Ended March 31, | | | 2022 – 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Cost of Goods Sold, net | | | | $ | 103,618 | | | | | $ | 66,605 | | | | | $ | 37,013 | | |
Total Operating Expense | | | | | 89,560 | | | | | | 42,665 | | | | | | 46,895 | | |
Other Income (Expense) | | | | | 14,530 | | | | | | (2,634) | | | | | | 17,164 | | |
Provision for Income Taxes | | | | | (25,515) | | | | | | (16,414) | | | | | | (9,101) | | |
| | | For the Year Ended December 31, | | | 2021 – 2020 | | ||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | $ Change | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Revenue, net of discounts | | | | $ | 737,850 | | | | | $ | 228,530 | | | | | $ | 509,320 | | |
Gross Profit | | | | | 331,019 | | | | | | 135,569 | | | | | | 195,450 | | |
Net Income (Loss) attributable to Verano Holdings Corp. | | | | | (57,507) | | | | | | 38,401 | | | | | | (95,908) | | |
Net Income (Loss) per share – basic | | | | | (0.20) | | | | | | 0.15 | | | | | | (0.35) | | |
Net Income (Loss) per share – diluted | | | | | (0.20) | | | | | | 0.14 | | | | | | (0.34) | | |
| | | For the Year Ended December 31, | | | 2021 – 2020 | | ||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | $ Change | | |||||||||
| | | (As Restated) | | | | | | | | | ||||||||
Cost of Goods Sold, net | | | | $ | 406,831 | | | | | $ | 92,961 | | | | | $ | 313,870 | | |
General and Administrative | | | | | 100,903 | | | | | | 23,838 | | | | | | 77,065 | | |
Sales and Marketing Expense | | | | | 8,644 | | | | | | 919 | | | | | | 7,725 | | |
Salaries and Benefits | | | | | 119,598 | | | | | | 16,228 | | | | | | 103,370 | | |
Depreciation and Amortization | | | | | 41,784 | | | | | | 2,278 | | | | | | 39,506 | | |
Total Operating Expense | | | | | 270,929 | | | | | | 43,263 | | | | | | 227,666 | | |
Other Expenses | | | | | 15,723 | | | | | | 12,546 | | | | | | 3,177 | | |
Provision for Income Taxes | | | | | (103,988) | | | | | | (42,296) | | | | | | (61,692) | | |
| | | For the Year Ended December 31, | | | 2020 – 2019 | | ||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | $ Change | | |||||||||
Revenues, net of discounts | | | | $ | 228,530 | | | | | $ | 65,968 | | | | | $ | 162,562 | | |
Gross Profit | | | | | 135,569 | | | | | | 36,040 | | | | | | 99,529 | | |
Net Income (Loss) attributable to Verano Holdings, LLC | | | | | 38,401 | | | | | | (18,273) | | | | | | 56,674 | | |
Net Income (Loss) per share – basic | | | | | 0.15 | | | | | | (0.07) | | | | | | 0.22 | | |
Net Income (Loss) per share – diluted | | | | | 0.14 | | | | | | (0.07) | | | | | | 0.21 | | |
| | | For the Year Ended December 31, | | | 2020 – 2019 | | ||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | $ Change | | |||||||||
Cost of goods sold | | | | $ | 92,961 | | | | | $ | 29,928 | | | | | $ | 63,033 | | |
General and Administrative | | | | | 23,838 | | | | | | 29,692 | | | | | | (5,854) | | |
Sales and Marketing Expense | | | | | 919 | | | | | | 926 | | | | | | (7) | | |
Salaries and Benefits | | | | | 16,228 | | | | | | 6,231 | | | | | | 9,997 | | |
Depreciation and Amortization | | | | | 2,278 | | | | | | 2,288 | | | | | | (10) | | |
Total Operating Expense | | | | | 43,263 | | | | | | 39,137 | | | | | | 4,126 | | |
Other Expenses | | | | | 12,546 | | | | | | 4,938 | | | | | | 7,608 | | |
Provision for Income Taxes | | | | | (42,296) | | | | | | (10,333) | | | | | | (31,963) | | |
| | | Three Months Ended March 31, | | |||||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | % Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 53,008 | | | | | $ | 49,161 | | | | | | 7.8% | | |
Retail | | | | | 164,334 | | | | | | 79,195 | | | | | | 107.5% | | |
Intersegment Eliminations | | | | | (15,107) | | | | | | (7,461) | | | | | | (102.5)% | | |
Total Revenues, net of discounts | | | | | 202,235 | | | | | | 120,895 | | | | | | 67.3% | | |
| | | For the Year Ended December 31, | | |||||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | % Change | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 217,739 | | | | | $ | 156,223 | | | | | | 39.4% | | |
Retail | | | | | 591,591 | | | | | | 88,470 | | | | | | 568.7% | | |
Intersegment Eliminations | | | | | (71,480) | | | | | | (16,163) | | | | | | (342.2)% | | |
Total Revenues, net of discounts | | | | $ | 737,850 | | | | | | 228,530 | | | | | | 222.9% | | |
| | | For the Year Ended December 31, | | |||||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | % Change | | |||||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 156,223 | | | | | $ | 46,068 | | | | | | 239.1% | | |
Retail | | | | | 88,470 | | | | | | 22,925 | | | | | | 285.9% | | |
Intersegment Eliminations | | | | | (16,163) | | | | | | (3,025) | | | | | | (434.3)% | | |
Total Revenues, net of discounts | | | | | 228,530 | | | | | | 65,968 | | | | | | 246.4% | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Net Cash Provided by Operating Activities | | | | $ | 34,457 | | | | | $ | 24,930 | | |
Net Cash Used in Investing Activities | | | | | (86,743) | | | | | | (72,068) | | |
Net Cash Provided by Financing Activities | | | | | 92,805 | | | | | | 143,004 | | |
| | | Years ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Net Cash Provided by (Used in) Operating Activities | | | | $ | 182,872 | | | | | $ | 71,627 | | | | | $ | (6,660) | | |
Net Cash (Used in) Investing Activities | | | | | (455,832) | | | | | | (86,908) | | | | | | (84,118) | | |
Net Cash Provided by Financing Activities | | | | | 355,676 | | | | | | 25,266 | | | | | | 24,108 | | |
| | | Payments Due by Period | | |||||||||||||||||||||||||||
Contractual Obligations | | | Total | | | Less than 1 year | | | 1-2 years | | | 3-4 years | | | 5 years and after | | |||||||||||||||
Long Term Debt(1) | | | | $ | 289,924 | | | | | $ | 13,771 | | | | | $ | 265,867 | | | | | $ | 2,108 | | | | | $ | 8,178 | | |
Operating Leases | | | | $ | 89,541 | | | | | $ | 11,457 | | | | | $ | 21,372 | | | | | $ | 18,534 | | | | | $ | 38,178 | | |
Purchase Obligations(2) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Other Long Term Obligations(3) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Total Contractual Obligations | | | | $ | 379,465 | | | | | $ | 25,228 | | | | | $ | 287,239 | | | | | $ | 20,642 | | | | | $ | 46,356 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
| | | | | | | | | (As Restated) | | |||
Raw Materials | | | | $ | 8,369 | | | | | $ | 5,767 | | |
Work in Process | | | | | 109,219 | | | | | | 96,367 | | |
Finished Goods | | | | | 36,462 | | | | | | 38,569 | | |
Total Inventories | | | | $ | 154,050 | | | | | $ | 140,703 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
ASSETS | | | | | | | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | | | $ | 139,637 | | | | | $ | — | | | | | $ | 139,637 | | |
Accounts Receivable, net | | | | | 17,676 | | | | | | — | | | | | | 17,676 | | |
Notes Receivable | | | | | — | | | | | | — | | | | | | — | | |
Inventory | | | | | 159,883 | | | | | | 3,898(a) | | | | | | 163,781 | | |
Prepaid Expenses and Other Current Assets | | | | | 22,583 | | | | | | — | | | | | | 22,583 | | |
Total Current Assets | | | | | 339,779 | | | | | | 3,898(a) | | | | | | 343,677 | | |
Property, Plant and Equipment, net | | | | | 479,747 | | | | | | — | | | | | | 479,747 | | |
Right Of Use Assets, net | | | | | 66,522 | | | | | | — | | | | | | 66,522 | | |
Intangible Assets, net | | | | | 1,368,358 | | | | | | — | | | | | | 1,368,358 | | |
Goodwill | | | | | 375,725 | | | | | | — | | | | | | 375,725 | | |
Investment in Associates | | | | | 7,396 | | | | | | — | | | | | | 7,396 | | |
Deposits and Other Assets | | | | | 2,514 | | | | | | — | | | | | | 2,514 | | |
TOTAL ASSETS | | | | $ | 2,640,041 | | | | | $ | 3,898(a) | | | | | $ | 2,643,939 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 61,050 | | | | | $ | — | | | | | $ | 61,050 | | |
Accrued Liabilities | | | | | 25,332 | | | | | | — | | | | | | 25,332 | | |
Income Tax Payable | | | | | 203,939 | | | | | | (20,116)(b)(d) | | | | | | 183,823 | | |
Current Portion of Lease Liabilities | | | | | 7,427 | | | | | | — | | | | | | 7,427 | | |
Current Portion of Notes Payable | | | | | 10,386 | | | | | | — | | | | | | 10,386 | | |
Acquisition Consideration Payable | | | | | 142,543 | | | | | | (4,760)(d) | | | | | | 137,783 | | |
Total Current Liabilities | | | | | 450,677 | | | | | | (24,876)(b)(d) | | | | | | 425,801 | | |
Long-Term Liabilities: | | | | | | | | | | | | | | | | | | | |
Deferred Revenue | | | | | 1,068 | | | | | | — | | | | | | 1,068 | | |
Notes Payable, net of Current Portion | | | | | 373,858 | | | | | | — | | | | | | 373,858 | | |
Lease Liabilities, net of Current Portion | | | | | 61,458 | | | | | | — | | | | | | 61,458 | | |
Deferred Income Taxes | | | | | 256,312 | | | | | | 2,659(b) | | | | | | 258,971 | | |
Total Long-Term Liabilities | | | | | 692,696 | | | | | | 2,659(b) | | | | | | 695,355 | | |
TOTAL LIABILITIES | | | | $ | 1,143,373 | | | | | $ | (22,217)(b)(d) | | | | | $ | 1,121,156 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,496,668 | | | | | | 26,115(a)(b)(d) | | | | | | 1,522,783 | | |
NON-CONTROLLING INTEREST | | | | | — | | | | | | — | | | | | | — | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,640,041 | | | | | $ | 3,898(a)(b) | | | | | $ | 2,643,939 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Revenues, net of discounts | | | | $ | 202,235 | | | | | $ | — | | | | | $ | 202,235 | | |
Cost of Goods Sold, net | | | | | 102,566 | | | | | | 1,052(a) | | | | | | 103,618 | | |
Gross Profit | | | | | 99,669 | | | | | | (1,052)(a) | | | | | | 98,617 | | |
Operating Expenses | | | | | 79,988 | | | | | | 9,572(a) | | | | | | 89,560 | | |
Income from Investments in Associates | | | | | 367 | | | | | | 1,638(b) | | | | | | 2,005 | | |
Income From Operations | | | | | 20,048 | | | | | | (8,986)(a)(b) | | | | | | 11,062 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | (990) | | | | | | — | | | | | | (990) | | |
Gain on Deconsolidation | | | | | 9,558 | | | | | | — | | | | | | 9,558 | | |
Gain on Previously Held Equity Interest | | | | | 17,275 | | | | | | (3,176)(b) | | | | | | 14,099 | | |
Other Income (Expense), net | | | | | (2,227) | | | | | | 4,761(d) | | | | | | 2,534 | | |
Interest Income (Expense), net | | | | | (10,672) | | | | | | — | | | | | | (10,672) | | |
Total Other Income (Expense) | | | | | 12,944 | | | | | | 1,587(d)(b) | | | | | | 14,530 | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 32,993 | | | | | | (7,401)(a)(d)(b) | | | | | | 25,592 | | |
Provision For Income Taxes | | | | | (42,833) | | | | | | 17,318(a)(b)(d) | | | | | | (25,515) | | |
Net Income (Loss) Before Non-Controlling Interest | | | | | (9,840) | | | | | | 9,917(a)(b)(d) | | | | | | 77 | | |
Net Income Attributable to Non-Controlling Interest | | | | | 291 | | | | | | — | | | | | | 291 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (10,131) | | | | | $ | 9,917(a)(b)(d) | | | | | $ | (214) | | |
Net Loss per share – basic | | | | | (0.03) | | | | | | 0.03(a)(b)(d) | | | | | | (0.00) | | |
Net Loss per share – diluted | | | | | (0.03) | | | | | | 0.03(a)(b)(d) | | | | | | (0.00) | | |
Basic – weighted average shares outstanding | | | | | 326,285,814 | | | | | | — | | | | | | 326,285,814 | | |
Diluted – weighted average shares outstanding | | | | | 326,285,814 | | | | | | — | | | | | | 326,285,814 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2022 | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,488,188 | | | | | $ | (12,404) | | | | | $ | 2,951 | | | | | $ | 1,478,735 | | |
Share-based compensation | | | | | — | | | | | | 771,337 | | | | | | 289 | | | | | | — | | | | | | — | | | | | | 289 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 1,403,067 | | | | | | 13,220 | | | | | | — | | | | | | — | | | | | | 13,220 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (3,242) | | | | | | (3,242) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 1,381,332 | | | | | | 17,506 | | | | | | — | | | | | | — | | | | | | 17,506 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (10,131) | | | | | | 291 | | | | | | (9,840) | | |
Balance as of March 31, 2022 | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,519,203 | | | | | $ | (22,535) | | | | | $ | — | | | | | $ | 1,496,668 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Adjustments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance at January 1, 2022 | | | | | — | | | | | | — | | | | | | 47,577 | | | | | | (42,831) | | | | | | (1,675) | | | | | | 3,071 | | |
Share-based compensation(a) | | | | | — | | | | | | — | | | | | | 11,453 | | | | | | — | | | | | | — | | | | | | 11,453 | | |
Noncontrolling interest adjustment for change in ownership(c) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 1,675 | | | | | | 1,675 | | |
Net Income(a)(b)(d) | | | | | — | | | | | | — | | | | | | — | | | | | | 9,917 | | | | | | — | | | | | | 9,917 | | |
Total Adjustments | | | | | — | | | | | | — | | | | | | 59,030 | | | | | | (32,914) | | | | | | — | | | | | | 26,116 | | |
As Restated | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 – As Restated | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
Share-based compensation | | | | | — | | | | | | 771,337 | | | | | | 11,742 | | | | | | — | | | | | | — | | | | | | 11,742 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 1,403,067 | | | | | | 13,220 | | | | | | — | | | | | | — | | | | | | 13,220 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,567) | | | | | | (1,567) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 1,381,332 | | | | | | 17,505 | | | | | | — | | | | | | — | | | | | | 17,505 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (214) | | | | | | 291 | | | | | | 77 | | |
Balance as of March 31, 2022 – As Restated | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,578,233 | | | | | $ | (55,449) | | | | | $ | — | | | | | $ | 1,522,783 | | |
|
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (10,131) | | | | | $ | 9,917(a)(b)(d) | | | | | $ | (214) | | |
Net income attributable to non-controlling interest | | | | | 291 | | | | | | — | | | | | | 291 | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 34,434 | | | | | | — | | | | | | 34,434 | | |
Non-cash interest expense | | | | | 674 | | | | | | — | | | | | | 674 | | |
Non-cash interest income | | | | | — | | | | | | — | | | | | | — | | |
Non-cash inventory step-up expense on acquisitions | | | | | 4,612 | | | | | | — | | | | | | 4,612 | | |
Loss on disposal of property, plant and equipment | | | | | 990 | | | | | | — | | | | | | 990 | | |
Gain on deconsolidation | | | | | (9,558) | | | | | | — | | | | | | (9,558) | | |
Gain on Disposal of Investments in Associates | | | | | (17,275) | | | | | | 3,176(b) | | | | | | (14,099) | | |
Bad debt expense | | | | | — | | | | | | — | | | | | | — | | |
Amortization of debt issuance costs | | | | | 1,514 | | | | | | — | | | | | | 1,514 | | |
Unrealized gain on marketable securities | | | | | (66) | | | | | | — | | | | | | (66) | | |
Write-off of note receivable | | | | | (3) | | | | | | — | | | | | | (3) | | |
Loss (Income) from underlying investees | | | | | 1,183 | | | | | | 1,638(c) | | | | | | (455) | | |
Loss on share issuance | | | | | 3,592 | | | | | | — | | | | | | 3,592 | | |
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Increase (Decrease) in fair value of contingent consideration | | | | | 2,293 | | | | | | (4,760)(d) | | | | | | (2,467) | | |
Stock based compensation | | | | | 289 | | | | | | 10,623(a) | | | | | | 10,912 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | — | | | | | | | | |
Accounts receivable | | | | | (269) | | | | | | — | | | | | | (269) | | |
Inventories | | | | | (26,595) | | | | | | — | | | | | | (26,595) | | |
Prepaid expenses and other current assets | | | | | 1,117 | | | | | | — | | | | | | 1,117 | | |
Deposits and other assets | | | | | 695 | | | | | | — | | | | | | 695 | | |
Accounts payable | | | | | 19,873 | | | | | | — | | | | | | 19,873 | | |
Accrued liabilities | | | | | (12,223) | | | | | | — | | | | | | (12,233) | | |
Lease Liabilities | | | | | (2,955) | | | | | | — | | | | | | (2,955) | | |
Income tax payable | | | | | 48,773 | | | | | | (20,778)(b)(d) | | | | | | 27,995 | | |
Deferred taxes | | | | | (6,672) | | | | | | 3,460(b) | | | | | | (3,212) | | |
Deferred revenue | | | | | (116) | | | | | | — | | | | | | (116) | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 34,457 | | | | | | — | | | | | | 34,457 | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (48,300) | | | | | | — | | | | | | (48,300) | | |
Proceeds from disposal of assets | | | | | 1,818 | | | | | | — | | | | | | 1,818 | | |
Advances to related parties | | | | | — | | | | | | — | | | | | | — | | |
Distributions to minority holders | | | | | — | | | | | | — | | | | | | — | | |
Purchases of intangible assets | | | | | — | | | | | | — | | | | | | — | | |
Acquisition of business, net of cash acquired | | | | | (60,082) | | | | | | — | | | | | | (60,082) | | |
Proceeds from sale deconsolidation and investment in Associates | | | | | 19,821 | | | | | | — | | | | | | 19,821 | | |
Purchase of interest in investment in associates | | | | | — | | | | | | — | | | | | | — | | |
Dividend received from investments in associates | | | | | — | | | | | | — | | | | | | — | | |
Issuance of note receivable | | | | | — | | | | | | — | | | | | | — | | |
Proceeds from note receivable | | | | | — | | | | | | — | | | | | | — | | |
Interest received on note receivable | | | | | — | | | | | | — | | | | | | — | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (86,743) | | | | | | — | | | | | | (86,743) | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | $ | 102,660 | | | | | $ | — | | | | | $ | 102,660 | | |
Principal repayments of notes payable | | | | | (6,870) | | | | | | — | | | | | | (6,870) | | |
Debt issuance costs paid | | | | | (2,985) | | | | | | — | | | | | | (2,985) | | |
Proceeds received from RTO financing | | | | | — | | | | | | — | | | | | | — | | |
Cash received in warrant private placement | | | | | — | | | | | | — | | | | | | — | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 92,805 | | | | | | — | | | | | | 92,805 | | |
NET INCREASE IN CASH | | | | | 40,519 | | | | | | — | | | | | | 40,519 | | |
CASH, BEGINNING OF PERIOD | | | | | 99,118 | | | | | | — | | | | | | 99,118 | | |
CASH, END OF PERIOD | | | | $ | 139,637 | | | | | $ | — | | | | | $ | 139,637 | | |
|
| | | March 31, 2022 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | | | | | | | |
Interest paid | | | | $ | 9,999 | | | | | $ | — | | | | | $ | 9,999 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 541 | | | | | $ | — | | | | | $ | 541 | | |
Consideration received in stock for the disposal of assets | | | | $ | 3,776 | | | | | $ | — | | | | | $ | 3,776 | | |
Issuance of shares under business combinations | | | | $ | 27,135 | | | | | $ | — | | | | | $ | 27,135 | | |
Acquisitions | | | | | | | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 17,532 | | | | | $ | — | | | | | $ | 17,532 | | |
Liabilities assumed | | | | | (3,981) | | | | | | — | | | | | | (3,981) | | |
Acquisition consideration payable | | | | | 38,936 | | | | | | — | | | | | | 38,936 | | |
Goodwill | | | | | 7,595 | | | | | | — | | | | | | 7,595 | | |
| | | | $ | 60,082 | | | | | $ | — | | | | | $ | 60,082 | | |
Revenues, net of discounts | | | | $ | 120,895 | | | | | $ | — | | | | | $ | 120,895 | | |
Cost of Goods Sold, net | | | | | 66,605 | | | | | | — | | | | | | 66,605 | | |
Gross Profit | | | | | 54,290 | | | | | | — | | | | | | 54,290 | | |
Operating Expenses | | | | | 36,973 | | | | | | 5,692(a) | | | | | | 42,665 | | |
Income from Investments in Associates | | | | | 803 | | | | | | — | | | | | | 803 | | |
Income From Operations | | | | | 18,120 | | | | | | (5,692)(a) | | | | | | 12,428 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | — | | | | | | — | | | | | | — | | |
Gain on Deconsolidation | | | | | — | | | | | | — | | | | | | — | | |
Gain on Previously Held Equity Interest | | | | | — | | | | | | — | | | | | | — | | |
Other Income (Expense), net | | | | | (867) | | | | | | — | | | | | | (867) | | |
Interest Income (Expense), net | | | | | (1,767) | | | | | | — | | | | | | (1,767) | | |
Total Other Income (Expense) | | | | | (2,634) | | | | | | — | | | | | | (2,634) | | |
Net Income Before Provision for Income Taxes and Non-Controlling Interest | | | | | 15,486 | | | | | | (5,692)(a) | | | | | | 9,794 | | |
Provision For Income Taxes | | | | | (16,414) | | | | | | — | | | | | | (16,414) | | |
Net Loss Before Non-Controlling Interest | | | | | (928) | | | | | | (5,692)(a) | | | | | | (6,620) | | |
Net Income Attributable to Non-Controlling Interest | | | | | 1,266 | | | | | | — | | | | | | 1,266 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (2,194) | | | | | $ | (5,692)(a) | | | | | $ | (7,886) | | |
Net Loss per share – basic | | | | | (0.02) | | | | | | (0.01)(a) | | | | | | (0.03) | | |
Net Loss per share – diluted | | | | | (0.02) | | | | | | (0.01)(a) | | | | | | (0.03) | | |
Basic – weighted average shares outstanding | | | | | 140,952,177 | | | | | | 89,629,989(a) | | | | | | 230,582,166 | | |
Diluted – weighted average shares outstanding | | | | | 140,952,177 | | | | | | 89,629,989(a) | | | | | | 230,582,166 | | |
As Previously Reported | | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non- Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2021 | | | | | 279,900,00 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,00) | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Share-based compensation | | | | | — | | | | | | 61 | | | | | | — | | | | | | — | | | | | | 61 | | | | | | | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 3,199,219 | | | | | | 62,898 | | | | | | — | | | | | | — | | | | | | 62,898 | | |
Warrants issued and exercised | | | | | — | | | | | | — | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (2,194) | | | | | | 1,266 | | | | | | (928) | | |
Balance as of March 31, 2021 | | | | | | | | | | | 293,199,219 | | | | | $ | 1,023,609 | | | | | $ | 7,053 | | | | | $ | 7,503 | | | | | $ | 1,038,166 | | |
Adjustments | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance at January 1, 2021 | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Share-based compensation(a) | | | | | — | | | | | | — | | | | | | 6,553 | | | | | | — | | | | | | — | | | | | | 6,553 | | |
Distributions to minority holders(c) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Net Loss(a)(b) | | | | | — | | | | | | — | | | | | | — | | | | | | (5,692) | | | | | | — | | | | | | (5,692) | | |
Total Adjustments | | | | | — | | | | | | — | | | | | | 6,553 | | | | | | (5,692) | | | | | | (100) | | | | | | 761 | | |
As Restated | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2021 – As Restated | | | | | 279,900,00 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,00) | | | | | | — | | | | | | | | | | | | | | | | | | | | | | | | | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority holders | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 6,614 | | | | | | — | | | | | | — | | | | | | 6,614 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 3,199,219 | | | | | | 62,898 | | | | | | — | | | | | | — | | | | | | 62,898 | | |
Warrants issued and exercised | | | | | — | | | | | | — | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Net Income (Loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (7,886) | | | | | | 1,266 | | | | | | (6,620) | | |
Balance as of March 31, 2021 – As Restated | | | | | | | | | | | 293,199,219 | | | | | $ | 1,030,163 | | | | | $ | 1,361 | | | | | $ | 7,403 | | | | | $ | 1,038,927 | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (2,194) | | | | | $ | (5,692)(a)(b) | | | | | $ | (7,886) | | |
Net income attributable to non-controlling interest | | | | | 1,266 | | | | | | — | | | | | | 1,266 | | |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 11,783 | | | | | | — | | | | | | 11,783 | | |
Non-cash interest expense | | | | | 357 | | | | | | — | | | | | | 357 | | |
Non-cash interest income | | | | | (237) | | | | | | — | | | | | | (237) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 17,844 | | | | | | — | | | | | | 17,844 | | |
Loss on disposal of property, plant and equipment | | | | | — | | | | | | — | | | | | | — | | |
Gain on deconsolidation | | | | | — | | | | | | — | | | | | | — | | |
Gain on Disposal of Investments in Associates | | | | | — | | | | | | — | | | | | | — | | |
Bad debt expense | | | | | 68 | | | | | | — | | | | | | 68 | | |
Amortization of debt issuance costs | | | | | 136 | | | | | | — | | | | | | 136 | | |
Unrealized gain on marketable securities | | | | | — | | | | | | — | | | | | | — | | |
Write-off of note receivable | | | | | — | | | | | | — | | | | | | — | | |
Loss (Income) from underlying investees | | | | | (6,802) | | | | | | 100(c) | | | | | | (6,702) | | |
Loss (Income) on share issuance | | | | | (125) | | | | | | — | | | | | | (125) | | |
Decrease in fair value of contingent consideration | | | | | — | | | | | | — | | | | | | — | | |
Stock based compensation | | | | | 61 | | | | | | 5,692(a) | | | | | | 5,752 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | — | | | | | | | | |
Accounts receivable | | | | | (6,131) | | | | | | — | | | | | | (6,131) | | |
Inventories | | | | | (19,239) | | | | | | — | | | | | | (19,239) | | |
Prepaid expenses and other current assets | | | | | (5,522) | | | | | | — | | | | | | (5,522) | | |
Deposits and other assets | | | | | 1,071 | | | | | | — | | | | | | 1,071 | | |
Accounts payable | | | | | 10,942 | | | | | | — | | | | | | 10,942 | | |
Accrued liabilities | | | | | 1,827 | | | | | | — | | | | | | 1,827 | | |
Lease Liabilities | | | | | (1,217) | | | | | | — | | | | | | (1,217) | | |
Income tax payable | | | | | 21,940 | | | | | | 240(b) | | | | | | 22,180 | | |
Deferred taxes | | | | | — | | | | | | (240)(b) | | | | | | (240) | | |
Deferred revenue | | | | | (997) | | | | | | — | | | | | | (997) | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 24,831 | | | | | | 100(a)(b)(c) | | | | | | 24,930 | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (36,402) | | | | | | — | | | | | | (36,402) | | |
Proceeds from disposal of assets | | | | | 734 | | | | | | — | | | | | | 734 | | |
Advances to related parties | | | | | 20 | | | | | | — | | | | | | 20 | | |
Distributions to minority holders | | | | | — | | | | | | (100)(c) | | | | | | (100) | | |
Purchases of intangible assets | | | | | (7,460) | | | | | | — | | | | | | (7,460) | | |
Acquisition of business, net of cash acquired | | | | | (38,573) | | | | | | — | | | | | | (38,573) | | |
Proceeds from sale deconsolidation and investment in Associates | | | | | — | | | | | | — | | | | | | — | | |
Purchase of interest in investment in associates | | | | | (3,350) | | | | | | — | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | 10,275 | | | | | | — | | | | | | 10,275 | | |
Issuance of note receivable | | | | | (147) | | | | | | — | | | | | | (147) | | |
Proceeds from note receivable | | | | | 2,931 | | | | | | — | | | | | | 2,931 | | |
Interest received on note receivable | | | | | 4 | | | | | | — | | | | | | 4 | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (71,969) | | | | | | (100)(c) | | | | | | (72,068) | | |
|
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | | — | | | | | | — | | | | | | — | | |
Principal repayments of notes payable | | | | | (7,516) | | | | | | — | | | | | | (7,516) | | |
Debt issuance costs paid | | | | | — | | | | | | — | | | | | | — | | |
Proceeds received from RTO financing | | | | | 75,420 | | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | 75,100 | | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 143,004 | | | | | | — | | | | | | 143,004 | | |
NET INCREASE IN CASH | | | | | 95,866 | | | | | | — | | | | | | 95,866 | | |
CASH, BEGINNING OF PERIOD | | | | | 16,402 | | | | | | — | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 112,268 | | | | | $ | — | | | | | $ | 112,268 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | | | | | | | |
Interest paid | | | | $ | 1,648 | | | | | $ | — | | | | | $ | 1,648 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 1,200 | | | | | $ | — | | | | | $ | 1,200 | | |
Consideration received in stock for the disposal of assets | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
| | | March 31, 2021 | | |||||||||||||||
| | | As Reported | | | Adjustments | | | As Restated | | |||||||||
Issuance of shares under business combinations | | | | $ | 690,109 | | | | | $ | — | | | | | $ | 690,109 | | |
Acquisitions | | | | | | | | | | | | | | | | | | | |
Tangible and Intangible assets acquired, net of cash | | | | $ | 787,405 | | | | | $ | — | | | | | $ | 787,405 | | |
Liabilities assumed | | | | | (215,083) | | | | | | — | | | | | | (215,083) | | |
Acquisition consideration payable | | | | | (731,059) | | | | | | — | | | | | | (731,059) | | |
Goodwill | | | | | 197,310 | | | | | | — | | | | | | 197,310 | | |
| | | | $ | 38,573 | | | | | $ | — | | | | | $ | 38,573 | | |
|
| | | March 31, 2022 | | | December 31, 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Raw Materials | | | | $ | 8,187$ | | | | | | 5,767 | | |
Work in Process | | | | | 114,470 | | | | | | 96,367 | | |
Finished Goods | | | | | 41,124 | | | | | | 38,569 | | |
Total Inventories | | | | $ | 163,781$ | | | | | | 140,703 | | |
| | June 30, 2022 | | December 31, 2021 | | | March 31, 2022 | | December 31, 2021 | | ||||||||||||||||
Land | | | $ | 29,878 | | | | $ | 29,399 | | | | | $ | 28,413 | | | | $ | 29,399 | | | ||||
Buildings and Improvements | | | | 170,842 | | | | | 126,020 | | | | | | 154,765 | | | | | 126,020 | | | ||||
Furniture and Fixtures | | | | 15,900 | | | | | 13,259 | | | | | | 13,886 | | | | | 13,259 | | | ||||
Computer Equipment and Software | | | | 19,074 | | | | | 14,078 | | | | | | 15,715 | | | | | 14,078 | | | ||||
Leasehold Improvements | | | | 188,038 | | | | | 182,514 | | | | | | 176,845 | | | | | 182,514 | | | ||||
Tools and Equipment | | | | 79,768 | | | | | 65,774 | | | | | | 71,189 | | | | | 65,774 | | | ||||
Vehicles | | | | 4,716 | | | | | 3,229 | | | | | | 4,091 | | | | | 3,229 | | | ||||
Assets Under Construction(1) | | | | 73,311 | | | | | 64,107 | | | | | | 70,231 | | | | | 64,107 | | | ||||
Total Property, Plant and Equipment | | | | 581,527 | | | | | 498,380 | | | |||||||||||||||
Total Property, Plant and Equipment, Gross | | | | 535,135 | | | | | 498,380 | | | |||||||||||||||
Less: Accumulated Depreciation | | | | (65,829) | | | | | (46,148) | | | | | | (55,388 | | | | | (46,148 | | | ||||
Property, Plant and Equipment, Net | | | $ | 515,698 | | | | $ | 452,232 | | | | | $ | 479,747 | | | | $ | 452,232 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | $ | 1,386,131 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,451,900 | | |
Purchases | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Additions from business combination | | | | | 13,281 | | | | | | — | | | | | | — | | | | | | 13,281 | | |
Adjustments to purchase price allocation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Disposals | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Balance as of June 30, 2022 | | | | $ | 1,399,412 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,465,181 | | |
| | Licenses | | Tradenames | | Technology | | Total | | | Licenses | | Tradenames | | Technology | | Total | | ||||||||||||||||||||||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||||||||||||||
Balance as of January 1, 2022 | | | $ | 1,386,131 | | | | $ | 54,166 | | | | $ | 11,603 | | | | $ | 1,451,900 | | | |||||||||||||||||||||||||||||
Purchases | | | | — | | | | | — | | | | | — | | | | | — | | | |||||||||||||||||||||||||||||
Additions from business combination | | | | 13,281 | | | | | — | | | | | — | | | | | 13,281 | | | |||||||||||||||||||||||||||||
Adjustments to purchase price allocation | | | | — | | | | | — | | | | | — | | | | | — | | | |||||||||||||||||||||||||||||
Disposals | | | | — | | | | | — | | | | | — | | | | | — | | | |||||||||||||||||||||||||||||
Balance as of March 31, 2022 | | | $ | 1,399,412 | | | | $ | 54,166 | | | | $ | 11,603 | | | | $ | 1,465,181 | | | |||||||||||||||||||||||||||||
Accumulated Amortization | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Balance as of January 1, 2022 | | | | 66,703 | | | | | 4,158 | | | | | 1,126 | | | | | 71,987 | | | | | | 66,703 | | | | | 4,158 | | | | | 1,126 | | | | | 71,987 | | | ||||||||
Amortization | | | | 46,499 | | | | | 2,710 | | | | | 614 | | | | | 49,823 | | | | | | 23,173 | | | | | 1,355 | | | | | 308 | | | | | 24,836 | | | ||||||||
Balance as of June 30, 2022 | | | $ | 113,202 | | | | $ | 6,868 | | | | $ | 1,740 | | | | $ | 121,810 | | | |||||||||||||||||||||||||||||
Balance as of March 31, 2022 | | | $ | 89,876 | | | | $ | 5,513 | | | | $ | 1,434 | | | | $ | 96,823 | | | |||||||||||||||||||||||||||||
Net Book Value | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||||
Balance as of January 1, 2022 | | | | 1,319,428 | | | | | 50,008 | | | | | 10,477 | | | | | 1,379,913 | | | | | | 1,319,428 | | | | | 50,008 | | | | | 10,477 | | | | | 1,379,913 | | | ||||||||
Balance as of June 30, 2022 | | | $ | 1,286,210 | | | | $ | 47,298 | | | | $ | 9,863 | | | | $ | 1,343,371 | | | |||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2022 | | | $ | 1,309,536 | | | | $ | 48,653 | | | | $ | 10,169 | | | | $ | 1,368,358 | | |
Year Ending December 31: | | Estimated Amortization | | | Estimated Amortization | | | ||||||||||
2022 (Remaining) | | | $ | 49,975 | | | | | $ | 74,961 | | | | ||||
2023 | | | | 99,948 | | | | | | 99,948 | | | | ||||
2024 | | | | 99,948 | | | | | | 99,948 | | | | ||||
2025 | | | | 99,948 | | | | | | 99,948 | | | | ||||
2026 | | | | 99,221 | | | | | | 99,221 | | | | ||||
Thereafter | | | | 894,331 | | | | | | 894,332 | | | | ||||
| | | $ | 1,343,371 | | | | | $ | 1,368,358 | | | | |
| | January 1, 2022 | | Impairment | | Adjustments to purchase price allocation | | Acquisitions | | June 30, 2022 | | | January 1, 2022 | | Impairment | | Adjustments to purchase price allocation | | Acquisitions | | March 31, 2022 | | ||||||||||||||||||||||||||||||||||||||||
Cultivation | | | $ | 91,116 | | | | $ | — | | | | $ | 1,050 | | | | $ | — | | | | $ | 92,166 | | | | | $ | 91,116 | | | | $ | — | | | | $ | 1,050 | | | | $ | — | | | | $ | 92,166 | | | ||||||||||
Retail | | | | 277,014 | | | | | — | | | | | 912 | | | | | 6,545 | | | | | 284,471 | | | | | | 277,014 | | | | | — | | | | | — | | | | | 6,545 | | | | | 283,559 | | | ||||||||||
Total | | | $ | 368,130 | | | | $ | — | | | | $ | 1,962 | | | | $ | 6,545 | | | | $ | 376,637 | | | | | $ | 368,130 | | | | $ | — | | | | $ | 1,050 | | | | $ | 6,545 | | | | $ | 375,725 | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | | | Three Months Ended March 31, 2022 | | Three Months Ended March 31, 2021 | | ||||||||||||||||||||||||||||
| | 2022 | | 2021 | | 2022 | | 2021 | | | (As Restated) | | (As Restated) | | ||||||||||||||||||||||||
Numerator | | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||
Net Loss attributable to Verano Holdings Corp. | | | $ | (9,847) | | | | $ | (29,688) | | | | $ | (10,061) | | | | $ | (37,574) | | | | | $ | (214) | | | | $ | (7,886) | | | ||||||
Denominator | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Basic | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Pre-RTO weighted-average shares outstanding | | | | | | | | | | | | | | | | | | | 158,203,932 | | | | | | 158,203,932 | | | | | | | | ||||||
Post-RTO weighted-average shares outstanding | | | | | | | | | 300,715,671 | | | | | | | | | | 297,365,427 | | | | | | 291,143,545 | | | | | | | | ||||||
Weighted-average shares outstanding – basic | | | | 328,519,193 | | | | | 300,715,671 | | | | | 327,402,503 | | | | | 265,842,657 | | | | | | 326,285,814 | | | | | 230,582,166 | | | ||||||
Diluted | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Pre-RTO weighted-average shares outstanding | | | | | | | | | | | | | | | | | | | 158,203,932 | | | | | | 158,203,932 | | | | | | | | ||||||
Post-RTO weighted-average shares outstanding | | | | | | | | | 300,715,671 | | | | | | | | | | 297,365,427 | | | | | | 291,143,545 | | | | | | | | ||||||
Weighted-average shares outstanding – diluted | | | | 328,519,193 | | | | | 300,715,671 | | | | | 327,402,503 | | | | | 265,842,657 | | | |||||||||||||||||
Weighted-average shares outstanding – basic | | | | 326,285,814 | | | | | 230,582,166 | | | |||||||||||||||||||||||||||
Basic earnings per share | | | $ | (0.03) | | | | $ | (0.10) | | | | $ | (0.03) | | | | $ | (0.14) | | | | | $ | (0.00) | | | | $ | (0.03) | | | ||||||
Diluted earnings per share | | | $ | (0.03) | | | | $ | (0.10) | | | | $ | (0.03) | | | | $ | (0.14) | | | | | $ | (0.00) | | | | $ | (0.03) | | |
| | AltMed Florida | | AltMed Arizona | | Total | | | AltMed Florida | | AltMed Arizona | | Total | | ||||||||||||||||||||||||
Cash | | | $ | 5,446 | | | | $ | 507 | | | | $ | 5,953 | | | | | $ | 5,446 | | | | $ | 507 | | | | $ | 5,953 | | | ||||||
Accounts receivable, net | | | | 60 | | | | | 498 | | | | | 558 | | | | | | 60 | | | | | 498 | | | | | 558 | | | ||||||
Inventory | | | | 83,205 | | | | | 5,827 | | | | | 89,032 | | | | | | 83,205 | | | | | 5,827 | | | | | 89,032 | | | ||||||
Prepaids and other current assets | | | | 833 | | | | | 1,989 | | | | | 2,822 | | | | | | 833 | | | | | 1,989 | | | | | 2,822 | | | ||||||
Property, plant and equipment, net | | | | 73,386 | | | | | 9,751 | | | | | 83,137 | | | | | | 73,386 | | | | | 9,751 | | | | | 83,137 | | | ||||||
Right-of-use asset, net | | | | 9,651 | | | | | — | | | | | 9,651 | | | | | | 9,651 | | | | | — | | | | | 9,651 | | | ||||||
Other assets | | | | 1,001 | | | | | — | | | | | 1,001 | | | | | | 1,001 | | | | | — | | | | | 1,001 | | | ||||||
Accounts payable and accrued liabilities | | | | (8,935) | | | | | (2,576) | | | | | (11,511) | | | | | | (8,935) | | | | | (2,576) | | | | | (11,511) | | | ||||||
Notes payable | | | | (3,579) | | | | | (3,343) | | | | | (6,922) | | | | | | (3,579) | | | | | (3,343) | | | | | (6,922) | | | ||||||
Deferred taxes | | | | (123,720) | | | | | (37,290) | | | | | (161,010) | | | | | | (123,720) | | | | | (37,290) | | | | | (161,010) | | | ||||||
Lease liabilities | | | | (9,651) | | | | | — | | | | | (9,651) | | | | | | (9,651) | | | | | — | | | | | (9,651) | | | ||||||
Total identifiable net assets (liabilities) | | | | 27,697 | | | | | (24,637) | | | | | 3,060 | | | | | | 27,697 | | | | | (24,637) | | | | | 3,060 | | | ||||||
Intangible assets | | | | 498,938 | | | | | 184,588 | | | | | 683,526 | | | | | | 498,938 | | | | | 184,588 | | | | | 683,526 | | | ||||||
Net assets | | | $ | 526,635 | | | | $ | 159,951 | | | | $ | 686,586 | | | | | $ | 526,635 | | | | $ | 159,951 | | | | $ | 686,586 | | |
| | AltMed Florida | | AltMed Arizona | | Total | | | AltMed Florida | | AltMed Arizona | | Total | | ||||||||||||||||||||||||
License | | | $ | 319,928 | | | | $ | 130,670 | | | | $ | 450,598 | | | | | $ | 319,928 | | | | $ | 130,670 | | | | $ | 450,598 | | | ||||||
Tradename | | | | 36,278 | | | | | 8,980 | | | | | 45,258 | | | | | | 36,278 | | | | | 8,980 | | | | | 45,258 | | | ||||||
Intellectual Property and Technology | | | | 10,603 | | | | | 885 | | | | | 11,488 | | | ||||||||||||||||||||||
Technology | | | | 10,603 | | | | | 885 | | | | | 11,488 | | | ||||||||||||||||||||||
Total intangible assets | | | | 366,809 | | | | | 140,535 | | | | | 507,344 | | | | | $ | 366,809 | | | | $ | 140,536 | | | | $ | 507,344 | | | ||||||
Goodwill (residual purchase price) | | | | 8,409 | | | | | 6,763 | | | | | 15,172 | | | | | $ | 8,409 | | | | $ | 6,763 | | | | $ | 15,172 | | | ||||||
Goodwill (deferred taxes)(a) | | | | 123,720 | | | | | 37,290 | | | | | 161,010 | | | | | | 123,720 | | | | | 37,290 | | | | | 161,010 | | | ||||||
Total goodwill | | | $ | 132,129 | | | | $ | 44,053 | | | | $ | 176,182 | | | | | $ | 132,129 | | | | $ | 44,053 | | | | $ | 176,182 | | |
| | | Consolidated Results | | | AltMed Pre-acquisition | | | Pro-forma Results | | |||||||||
Revenues, net of discounts | | | | $ | 319,961 | | | | | $ | 22,402 | | | | | $ | 342,363 | | |
Net income (loss) | | | | | (37,574) | | | | | | 10,933 | | | | | | (26,641) | | |
| | | Consolidated Results | | | AltMed Pre-acquisition | | | Pro-forma Results | | |||||||||
Revenues, net of discounts | | | | | 120,895 | | | | | | 22,402 | | | | | | 143,297 | | |
Net income (loss) | | | | | (7,886) | | | | | | 10,933 | | | | | | 3,047 | | |
| | | Greengate | | |||
Cash and cash equivalents | | | | $ | 2,315 | | |
Inventory | | | | | 1,021 | | |
Prepaid & other current Assets | | | | | 324 | | |
Deposits and Other non-current assets | | | | | 45 | | |
Property, plant and equipment, net | | | | | 1,673 | | |
Right-of-use asset, Net | | | | | 1,836 | | |
Accounts payable and accrued liabilities | | | | | (1,569) | | |
Other liabilities | | | | | (72) | | |
Lease liabilities | | | | | (1,836) | | |
Total identifiable net assets (liabilities) | | | | | 3,737 | | |
Total Intangible assets | | | | | 19,826 | | |
| | | Six Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 186,106 | | | | | $ | 89,400 | | | | | $ | 44,455 | | | | | $ | 319,961 | | |
Net loss | | | | | (25,733) | | | | | | (9,570) | | | | | | (2,271) | | | | | | (37,574) | | |
| | | Three Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 99,294 | | | | | $ | 57,277 | | | | | $ | 42,495 | | | | | $ | 199,066 | | |
Net loss | | | | | (23,619) | | | | | | (4,180) | | | | | | (1,889) | | | | | | (29,688) | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 86,813 | | | | | $ | 32,123 | | | | | $ | 1,959 | | | | | $ | 120,895 | | |
Net income (loss) | | | | | (2,113) | | | | | | (5,391) | | | | | | (382) | | | | | | (7,886) | | |
| | | Six Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 186,106 | | | | | $ | 111,802 | | | | | $ | 133,091 | | | | | $ | 430,999 | | |
Pro forma net income (loss) | | | | | (25,733) | | | | | | 1,362 | | | | | | 19,785 | | | | | | (4,586) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) intangible amortization | | | | | — | | | | | | 14,899 | | | | | | 6,712 | | | | | | 21,611 | | |
(b) intangible amortization | | | | | — | | | | | | 45,797 | | | | | | 6,392 | | | | | | 52,189 | | |
Total pro forma adjustments | | | | | — | | | | | | 60,696 | | | | | | 13,104 | | | | | | 73,800 | | |
Total pro forma net income (loss) | | | | $ | (25,733) | | | | | $ | 62,058 | | | | | $ | 32,889 | | | | | $ | 69,214 | | |
| | | Three Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 99,294 | | | | | $ | 57,277 | | | | | $ | 60,001 | | | | | $ | 216,572 | | |
Pro forma net income (loss) | | | | | (23,619) | | | | | | (4,180) | | | | | | 2,477 | | | | | | (25,322) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) intangible amortization | | | | | — | | | | | | 8,939 | | | | | | 6,224 | | | | | | 15,163 | | |
(b) intangible amortization | | | | | — | | | | | | 27,952 | | | | | | 6,392 | | | | | | 34,344 | | |
Total pro forma adjustments | | | | | — | | | | | | 36,891 | | | | | | 12,616 | | | | | | 49,507 | | |
Total pro forma net income (loss) | | | | $ | (23,619) | | | | | $ | 32,711 | | | | | $ | 15,093 | | | | | $ | 24,185 | | |
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 86,813 | | | | | $ | 54,525 | | | | | $ | 11,611 | | | | | $ | 152,949 | | |
Net income (loss) | | | | | (2,113) | | | | | | 5,541 | | | | | | 2,297 | | | | | | 5,725 | | |
| | As of | | |||||||||||||||||||||||
| | June 30, 2022 | | December 31, 2021 | | | March 31, 2022 | | December 31, 2021 | | ||||||||||||||||
Credit Facility | | | $ | 350,000 | | | | $ | 250,000 | | | | | $ | 350,000 | | | | $ | 250,000 | | | ||||
Secured Promissory Notes | | | | 1,668 | | | | | 6,663 | | | | | | 1,687 | | | | | 6,663 | | | ||||
Mortgage Loans | | | | 56,122 | | | | | 38,856 | | | | | | 39,084 | | | | | 38,856 | | | ||||
Vehicle and Equipment Loans | | | | 2,209 | | | | | 1,951 | | | | | | 2,489 | | | | | 1,951 | | | ||||
Unamortized Debt Issuance Costs | | | | (7,370) | | | | | (7,545) | | | |||||||||||||||
Total Notes Payable | | | $ | 402,629 | | | | $ | 289,925 | | | |||||||||||||||
Less: Current Portion of Notes Payable | | | | 258,880 | | | | | 13,771 | | | |||||||||||||||
Total Long-Term Debt, net | | | $ | 143,749 | | | | $ | 276,154 | | | |||||||||||||||
Unamortized debt issuance costs | | | | (9,016) | | | | | (7,545) | | | |||||||||||||||
Total notes payable | | | $ | 384,244 | | | | $ | 289,925 | | | |||||||||||||||
Less: current portion of notes payable | | | | 10,386 | | | | | 13,771 | | | |||||||||||||||
Total long-term debt, net | | | $ | 373,858 | | | | $ | 276,154 | | |
| | Number of Shares | | Weighted Avg. Exercise Price C$ | | Weighted Average Remaining Contractual Life | | | Number of Shares | | Weighted Avg. Exercise Price C$ | | Weighted Average Remaining Contractual Life | | ||||||||||||||||||||||||
Balance as of December 31, 2021 | | | | 56,078 | | | | | 30.60 | | | | | 9.16 | | | | | | 56,078 | | | | | 29.97 | | | | | 9.16 | | | ||||||
Vested | | | | 18,798 | | | | | 30.60 | | | | | | | 18,798 | | | | | 29.97 | | | | | | | | ||||||||||
Exercisable at June 30, 2022 | | | | 24,167 | | | | | 30.60 | | | | | 8.67 | | | ||||||||||||||||||||||
Exercisable at March 31, 2022 | | | | 24,167 | | | | | 29.97 | | | | | 8.92 | | |
| | Number of Shares | | Weighted Avg. Grant Date Fair Value C$ | | | Number of Shares | | Weighted Avg. Grant Date Fair Value C$ | | ||||||||||||||||
Unvested Shares at December 31, 2021 | | | | 2,413,887 | | | | | 30.49 | | | | | | 2,413,887 | | | | | 29.98 | | | ||||
Granted | | | | 2,748,440 | | | | | 10.57 | | | | | | 243,710 | | | | | 16.30 | | | ||||
Forfeited | | | | 975 | | | | | 23.97 | | | | | | 975 | | | | | 23.30 | | | ||||
Vested | | | | 1,189,055 | | | | | 30.65 | | | | | | 1,179,961 | | | | | 30.31 | | | ||||
Unvested Shares at June 30, 2022 | | | | 3,972,297 | | | | | 16.66 | | | |||||||||||||||
Unvested Shares at March 31, 2022 | | | | 1,476,661 | | | | | 27.75 | | |
| | Six Months Ended June 30, | | | Three Months Ended March 31, | | ||||||||||||||||||||
| | 2022 | | 2021 | | | 2022 | | 2021 | | ||||||||||||||||
Weighted average grant date fair value (per share) of RSUs granted (C$) | | | | 16.66 | | | | | 30.60 | | | | | | 16.30 | | | | | 30.11 | | | ||||
Intrinsic value of RSUs vested, using market price at vest date (C$) (in thousands) | | | | 15.41 | | | | | — | | | | | | 15.41 | | | | | — | | |
| | Three Months Ended March 31, | | |||||||||||||||||||||||||||||||||||
| | Three Months Ended June 30, | | Six Months Ended June 30, | | | 2022 | | 2021 | | ||||||||||||||||||||||||||||
| | 2022 | | 2021 | | 2022 | | 2021 | | | (As Restated) | | (As Restated) | | ||||||||||||||||||||||||
Stock Options Expense | | | $ | 62 | | | | $ | 115 | | | | $ | 125 | | | | $ | 168 | | | | | $ | 63 | | | | $ | 53 | | | ||||||
Restricted Stock Units | | | | 13,430 | | | | | 12,465 | | | | | 24,280 | | | | | 18,165 | | | | | | 10,850 | | | | | 5,699 | | | ||||||
Total Stock Based Compensation Expense | | | $ | 13,492 | | | | $ | 12,580 | | | | $ | 24,405 | | | | $ | 18,333 | | | | | $ | 10,913 | | | | $ | 5,752 | | |
| | Three Months Ended March 31, | | |||||||||||||||||||||||||||||||||||
| | Three Months Ended June 30, | | Six Months Ended June 30, | | | 2022 | | 2021 | | ||||||||||||||||||||||||||||
| | 2022 | | 2021 | | 2022 | | 2021 | | | (As Restated) | | (As Restated) | | ||||||||||||||||||||||||
Income before Income Taxes | | | $ | 1,256 | | | | $ | (6,152) | | | | $ | 26,847 | | | | $ | 3,642 | | | | | $ | 25,592 | | | | $ | 9,794 | | | ||||||
Income Tax Expense | | | | (11,103) | | | | | (23,438) | | | | | (36,617) | | | | | (39,852) | | | | | | (25,515) | | | | | (16,414) | | | ||||||
Effective Tax Rate | | | | 662.9% | | | | | 381.0% | | | | | 112.3% | | | | | 1093.8% | | | | | | 86.8% | | | | | 173.0% | | |
| | June 30, 2022 | | December 31, 2021 | | | March 31, 2022 | | December 31, 2021 | | ||||||||||||||||
Weighted average remaining lease term (years) | | | | 8.26 | | | | | 8.52 | | | | | | 8.18 | | | | | 8.52 | | | ||||
Weighted average discount rate | | | | 8.03% | | | | | 8.11% | | | | | | 8.03% | | | | | 8.11% | | |
Year Ending December 31, | | | | | | | | | | | | | | | | | | |||
Remainder 2022 | | | $ | 6,851 | | | | $ | 11,457 | | | | | | 9,295 | | | |||
2023 | | | | 13,244 | | | | | 11,024 | | | | | | 11,873 | | | |||
2024 | | | | 12,519 | | | | | 10,348 | | | | | | 11,274 | | | |||
2025 | | | | 11,590 | | | | | 9,717 | | | | | | 10,318 | | | |||
2026 | | | | 10,722 | | | | | 8,818 | | | | | | 9,416 | | | |||
2027 and Thereafter | | | | 47,894 | | | | | 38,177 | | | | | | 41,733 | | | |||
Total Lease Payments | | | | 102,820 | | | | | 89,541 | | | | | | 93,909 | | | |||
Less: Interest | | | | (28,737) | | | | | (26,166) | | | | | | (25,024) | | | |||
Present Value of Lease Liability | | | $ | 74,083 | | | | $ | 63,375 | | | | | | 68,885 | | |
| | Three Months Ended March 31, | | |||||||||||||||||||||||||||||||||||
| | Three Months Ended June 30, | | Six Months Ended June 30, | | | 2022 | | 2021 | | ||||||||||||||||||||||||||||
| | 2022 | | 2021 | | 2022 | | 2021 | | | (As Restated) | | (As Restated) | | ||||||||||||||||||||||||
Revenue, net of discounts | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Cultivation (Wholesale) | | | $ | 67,673 | | | | $ | 59,312 | | | | $ | 120,681 | | | | $ | 108,473 | | | | | $ | 53,008 | | | | $ | 49,161 | | | ||||||
Retail | | | | 185,308 | | | | | 156,873 | | | | | 349,642 | | | | | 236,068 | | | | | | 164,334 | | | | | 79,195 | | | ||||||
Intersegment Eliminations | | | | (29,319) | | | | | (17,119) | | | | | (44,426) | | | | | (24,580) | | | | | | (15,107) | | | | | (7,461) | | | ||||||
Total Revenue, net of discounts | | | | 223,662 | | | | | 199,066 | | | | | 425,897 | | | | | 319,961 | | | | | | 202,235 | | | | | 120,895 | | | ||||||
Depreciation and Amortization | | | | | | | | | | | | |||||||||||||||||||||||||||
Cultivation (Wholesale) | | | | 19,725 | | | | | 8,320 | | | |||||||||||||||||||||||||||
Retail | | | | 14,709 | | | | | 3,463 | | | |||||||||||||||||||||||||||
Total Depreciation and Amortization | | | | 34,434 | | | | | 11,783 | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, | | | Three Months Ended March 31, | | ||||||||||||||||||||||||||||||
| | 2022 | | 2021 | | 2022 | | 2021 | | | 2022 | | 2021 | | ||||||||||||||||||||||||
Depreciation and Amortization | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||||
Cultivation (Wholesale) | | | | 19,089 | | | | | 13,963 | | | | | 38,814 | | | | | 22,282 | | | |||||||||||||||||
Retail | | | | 16,388 | | | | | 10,311 | | | | | 31,097 | | | | | 13,775 | | | |||||||||||||||||
Total Depreciation and Amortization | | | | 35,477 | | | | | 24,274 | | | | | 69,911 | | | | | 36,057 | | | |||||||||||||||||
| | (As Restated) | | (As Restated) | | |||||||||||||||||||||||||||||||||
Income taxes | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||||
Cultivation (Wholesale) | | | | 1,265 | | | | | 8,080 | | | | | 12,502 | | | | | 11,776 | | | | | | 11,237 | | | | | 3,696 | | | ||||||
Retail | | | | 9,838 | | | | | 15,358 | | | | | 24,115 | | | | | 28,076 | | | | | | 14,278 | | | | | 12,718 | | | ||||||
Total Income Taxes | | | | 11,103 | | | | | 23,438 | | | | | 36,617 | | | | | 39,852 | | | | | | 25,515 | | | | | 16,414 | | | |
| | | Consolidated VIE | | | Consolidated VOE | | | Consolidated VIE | | | Consolidated VOE | | | | ||||||||||||||||
| | | March 31, 2022 | | | December 31, 2021 | | | | ||||||||||||||||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||||||||||||||
Current Assets | | | | $ | 47,572 | | | | | $ | 18,244 | | | | | $ | 43,045 | | | | | $ | 20,464 | | | | | ||||
Due To/(From) | | | | | (33,082) | | | | | | (6,084) | | | | | | (25,723) | | | | | | 14,228 | | | | | ||||
Non-Current Assets | | | | | 205,503 | | | | | | 245,293 | | | | | | 207,908 | | | | | | 226,108 | | | | | ||||
Current Liabilities | | | | | 34,576 | | | | | | 12,358 | | | | | | 32,934 | | | | | | 22,659 | | | | | ||||
Non-Current Liabilities | | | | | 42,552 | | | | | | 45,438 | | | | | | 45,873 | | | | | | 45,603 | | | | | ||||
Non-controlling Interest | | | | | — | | | | | | — | | | | | | 1,276 | | | | | | — | | | | | ||||
Equity attributable to Verano Holdings, Corp. | | | | | 142,865 | | | | | | 199,657 | | | | | | 145,147 | | | | | | 192,538 | | | | |
| | | Consolidated VIE | | | Consolidated VOE | | | Consolidated VIE | | | Consolidated VOE | | ||||||||||||
| | | June 30, 2022 | | | December 31, 2021 | | ||||||||||||||||||
| | | | | | | | | | | | | | | (As Restated) | | |||||||||
Current Assets | | | | $ | 43,362 | | | | | $ | — | | | | | $ | 43,045 | | | | | $ | 20,464 | | |
Due To/(From) | | | | | (68,307) | | | | | | — | | | | | | (25,723) | | | | | | 14,228 | | |
Non-Current Assets | | | | | 96,342 | | | | | | — | | | | | | 207,908 | | | | | | 226,108 | | |
Current Liabilities | | | | | 14,359 | | | | | | — | | | | | | 32,934 | | | | | | 22,659 | | |
Non-Current Liabilities | | | | | 11,134 | | | | | | — | | | | | | 45,873 | | | | | | 45,603 | | |
Non-Controlling Interest | | | | | — | | | | | | — | | | | | | 1,276 | | | | | | — | | |
Equity attributable to Verano Holdings, Corp. | | | | | 45,904 | | | | | | — | | | | | | 145,147 | | | | | | 192,538 | | |
| | | As of March 31, 2022 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
(As Restated) | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash and Cash Equivalents | | | | $ | 139,637 | | | | | $ | — | | | | | $ | — | | | | | $ | 139,637 | | |
Investments | | | | | 3,842 | | | | | | — | | | | | | — | | | | | | 3,842 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (137,783) | | | | | | (137,783) | | |
Total | | | | $ | 143,479 | | | | | $ | — | | | | | $ | (137,783) | | | | | $ | 5,696 | | |
| | | As of December 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 99,118 | | | | | $ | — | | | | | $ | — | | | | | $ | 99,118 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (208,349) | | | | | | (208,349) | | |
Total | | | | $ | 99,118 | | | | | $ | — | | | | | $ | (208,349) | | | | | $ | (109,231) | | |
| | | For the Year Ended December 31, 2021 | | |||||||||||||||||||||||||||
($ in Thousands) | | | Verano Holdings Corp. | | | AME Group Pre-Acquisition | | | Pro Forma Adjustments | | | | | | | | | Pro Forma Combined | | ||||||||||||
Revenues, net of discounts | | | | | 737,850 | | | | | | 22,402 | | | | | | | | | | | | | | | | | | 760,252 | | |
Cost of Goods Sold | | | | | 406,831 | | | | | | 8,087 | | | | | | (68,934) | | | | | | a | | | | | | 345,984 | | |
Gross Profit | | | | | 331,019 | | | | | | 14,315 | | | | | | 68,934 | | | | | | | | | | | | 414,268 | | |
Total Operating Expenses | | | | | 270,929 | | | | | | 3,299 | | | | | | 377 | | | | | | b | | | | | | 275,395 | | |
Other Income (Expense) | | | | | (117,597) | | | | | | (83) | | | | | | | | | | | | | | | | | | (117,680) | | |
Net Income (Loss) | | | | | (57,507) | | | | | | 10,933 | | | | | | 68,557 | | | | | | c | | | | | | 21,983 | | |
Net Income (Loss) per share – basic | | | | | (0.20) | | | | | | — | | | | | | | | | | | | | | | | | | 0.06 | | |
Net Income (Loss) per share – diluted | | | | | (0.20) | | | | | | — | | | | | | | | | | | | | | | | | | 0.06 | | |
Weighted average number of shares – basic | | | | | 290,443,432 | | | | | | 65,191,388 | | | | | | | | | | | | | | | | | | 355,634,820 | | |
Weighted average number of shares – diluted | | | | | 290,443,432 | | | | | | 65,191,388 | | | | | | | | | | | | | | | | | | 364,353,560 | | |
| | | For the Three Months Ended March 31, | | | 2022 – 2021 | | ||||||||||||
| | ||||||||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Revenue, net of discounts | | | | $ | 202,235 | | | | | $ | 120,895 | | | | | $ | 81,340 | | |
Gross Profit | | | | | 98,617 | | | | | | 54,290 | | | | | | 44,327 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (214) | | | | | | (7,886) | | | | | | 7,672 | | |
Net Loss per share – basic | | | | | (0.00) | | | | | | (0.03) | | | | | | 0.03 | | |
Net Loss per share – diluted | | | | | (0.00) | | | | | | (0.03) | | | | | | 0.03 | | |
($ in thousands) | | | March 31, 2022 | | | December 31, 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Total Assets | | | | $ | 2,643,939 | | | | | $ | 2,548,655 | | |
Long-Term Liabilities | | | | | 695,355 | | | | | | 596,333 | | |
| | | For the Three Months Ended March 31, | | | 2022 – 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Cost of Goods Sold, net | | | | $ | 103,618 | | | | | $ | 66,605 | | | | | $ | 37,013 | | |
Total Operating Expense | | | | | 89,560 | | | | | | 42,665 | | | | | | 46,895 | | |
Other Income (Expense) | | | | | 14,530 | | | | | | (2,634) | | | | | | 17,164 | | |
Provision for Income Taxes | | | | | (25,515) | | | | | | (16,414) | | | | | | (9,101) | | |
| | | For the Year Ended December 31, | | | 2021 – 2020 | | ||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | $ Change | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Revenue, net of discounts | | | | $ | 737,850 | | | | | $ | 228,530 | | | | | $ | 509,320 | | |
Gross Profit | | | | | 331,019 | | | | | | 135,569 | | | | | | 195,450 | | |
Net Income (Loss) attributable to Verano Holdings Corp. | | | | | (57,507) | | | | | | 38,401 | | | | | | (95,908) | | |
Net Income (Loss) per share – basic | | | | | (0.20) | | | | | | 0.15 | | | | | | (0.35) | | |
Net Income (Loss) per share – diluted | | | | | (0.20) | | | | | | 0.14 | | | | | | (0.34) | | |
| | | For the Year Ended December 31, | | | 2021 – 2020 | | ||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | $ Change | | |||||||||
| | | (As Restated) | | | | | | | | | ||||||||
Cost of Goods Sold, net | | | | $ | 406,831 | | | | | $ | 92,961 | | | | | $ | 313,870 | | |
General and Administrative | | | | | 100,903 | | | | | | 23,838 | | | | | | 77,065 | | |
Sales and Marketing Expense | | | | | 8,644 | | | | | | 919 | | | | | | 7,725 | | |
Salaries and Benefits | | | | | 119,598 | | | | | | 16,228 | | | | | | 103,370 | | |
Depreciation and Amortization | | | | | 41,784 | | | | | | 2,278 | | | | | | 39,506 | | |
Total Operating Expense | | | | | 270,929 | | | | | | 43,263 | | | | | | 227,666 | | |
Other Expenses | | | | | 15,723 | | | | | | 12,546 | | | | | | 3,177 | | |
Provision for Income Taxes | | | | | (103,988) | | | | | | (42,296) | | | | | | (61,692) | | |
| | | For the Year Ended December 31, | | | 2020 – 2019 | | ||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | $ Change | | |||||||||
Revenues, net of discounts | | | | $ | 228,530 | | | | | $ | 65,968 | | | | | $ | 162,562 | | |
Gross Profit | | | | | 135,569 | | | | | | 36,040 | | | | | | 99,529 | | |
Net Income (Loss) attributable to Verano Holdings, LLC | | | | | 38,401 | | | | | | (18,273) | | | | | | 56,674 | | |
Net Income (Loss) per share – basic | | | | | 0.15 | | | | | | (0.07) | | | | | | 0.22 | | |
Net Income (Loss) per share – diluted | | | | | 0.14 | | | | | | (0.07) | | | | | | 0.21 | | |
| | | For the Year Ended December 31, | | | 2020 – 2019 | | ||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | $ Change | | |||||||||
Cost of goods sold | | | | $ | 92,961 | | | | | $ | 29,928 | | | | | $ | 63,033 | | |
General and Administrative | | | | | 23,838 | | | | | | 29,692 | | | | | | (5,854) | | |
Sales and Marketing Expense | | | | | 919 | | | | | | 926 | | | | | | (7) | | |
Salaries and Benefits | | | | | 16,228 | | | | | | 6,231 | | | | | | 9,997 | | |
Depreciation and Amortization | | | | | 2,278 | | | | | | 2,288 | | | | | | (10) | | |
Total Operating Expense | | | | | 43,263 | | | | | | 39,137 | | | | | | 4,126 | | |
Other Expenses | | | | | 12,546 | | | | | | 4,938 | | | | | | 7,608 | | |
Provision for Income Taxes | | | | | (42,296) | | | | | | (10,333) | | | | | | (31,963) | | |
| | | Three Months Ended March 31, | | |||||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | % Change | | |||||||||
| | | (As Restated) | | | (As Restated) | | | | | | | | ||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 53,008 | | | | | $ | 49,161 | | | | | | 7.8% | | |
Retail | | | | | 164,334 | | | | | | 79,195 | | | | | | 107.5% | | |
Intersegment Eliminations | | | | | (15,107) | | | | | | (7,461) | | | | | | (102.5)% | | |
Total Revenues, net of discounts | | | | | 202,235 | | | | | | 120,895 | | | | | | 67.3% | | |
| | | For the Year Ended December 31, | | |||||||||||||||
($ in thousands) | | | 2021 | | | 2020 | | | % Change | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 217,739 | | | | | $ | 156,223 | | | | | | 39.4% | | |
Retail | | | | | 591,591 | | | | | | 88,470 | | | | | | 568.7% | | |
Intersegment Eliminations | | | | | (71,480) | | | | | | (16,163) | | | | | | (342.2)% | | |
Total Revenues, net of discounts | | | | $ | 737,850 | | | | | | 228,530 | | | | | | 222.9% | | |
| | | For the Year Ended December 31, | | |||||||||||||||
($ in thousands) | | | 2020 | | | 2019 | | | % Change | | |||||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 156,223 | | | | | $ | 46,068 | | | | | | 239.1% | | |
Retail | | | | | 88,470 | | | | | | 22,925 | | | | | | 285.9% | | |
Intersegment Eliminations | | | | | (16,163) | | | | | | (3,025) | | | | | | (434.3)% | | |
Total Revenues, net of discounts | | | | | 228,530 | | | | | | 65,968 | | | | | | 246.4% | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Net Cash Provided by Operating Activities | | | | $ | 34,457 | | | | | $ | 24,930 | | |
Net Cash Used in Investing Activities | | | | | (86,743) | | | | | | (72,068) | | |
Net Cash Provided by Financing Activities | | | | | 92,805 | | | | | | 143,004 | | |
| | | Years ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Net Cash Provided by (Used in) Operating Activities | | | | $ | 182,872 | | | | | $ | 71,627 | | | | | $ | (6,660) | | |
Net Cash (Used in) Investing Activities | | | | | (455,832) | | | | | | (86,908) | | | | | | (84,118) | | |
Net Cash Provided by Financing Activities | | | | | 355,676 | | | | | | 25,266 | | | | | | 24,108 | | |
| | | Payments Due by Period | | |||||||||||||||||||||||||||
Contractual Obligations | | | Total | | | Less than 1 year | | | 1-2 years | | | 3-4 years | | | 5 years and after | | |||||||||||||||
Long Term Debt(1) | | | | $ | 289,924 | | | | | $ | 13,771 | | | | | $ | 265,867 | | | | | $ | 2,108 | | | | | $ | 8,178 | | |
Operating Leases | | | | $ | 89,541 | | | | | $ | 11,457 | | | | | $ | 21,372 | | | | | $ | 18,534 | | | | | $ | 38,178 | | |
Purchase Obligations(2) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Other Long Term Obligations(3) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Total Contractual Obligations | | | | $ | 379,465 | | | | | $ | 25,228 | | | | | $ | 287,239 | | | | | $ | 20,642 | | | | | $ | 46,356 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
| | | (Unaudited) | | | (As Restated) | | ||||||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and Cash Equivalents | | | | $ | 92,833 | | | | | $ | 99,118 | | |
Accounts Receivable, net | | | | | 13,253 | | | | | | 17,410 | | |
Notes Receivable | | | | | — | | | | | | 285 | | |
Inventory | | | | | 154,050 | | | | | | 140,703 | | |
Prepaid Expenses and Other Current Assets | | | | | 27,820 | | | | | | 19,528 | | |
Total Current Assets | | | | | 287,956 | | | | | | 277,044 | | |
Property, Plant and Equipment, net | | | | | 515,698 | | | | | | 452,232 | | |
Right of Use Assets, net | | | | | 71,472 | | | | | | 61,346 | | |
Intangible Assets, net | | | | | 1,343,371 | | | | | | 1,379,913 | | |
Goodwill | | | | | 376,637 | | | | | | 368,130 | | |
Investment in Associates | | | | | 7,252 | | | | | | 7,491 | | |
Deposits and Other Assets | | | | | 2,584 | | | | | | 2,499 | | |
TOTAL ASSETS | | | | $ | 2,604,970 | | | | | $ | 2,548,655 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 60,832 | | | | | $ | 45,172 | | |
Accrued Liabilities | | | | | 30,773 | | | | | | 42,149 | | |
Income Tax Payable | | | | | 161,430 | | | | | | 154,512 | | |
Current Portion of Lease Liabilities | | | | | 7,961 | | | | | | 6,563 | | |
Current Portion of Notes Payable | | | | | 258,880 | | | | | | 13,771 | | |
Acquisition Consideration Payable | | | | | 66,901 | | | | | | 208,349 | | |
Total Current Liabilities | | | | | 586,777 | | | | | | 470,516 | | |
Long-Term Liabilities: | | | | | | | | | | | | | |
Deferred Revenue | | | | | 271 | | | | | | 1,183 | | |
Notes Payable, net of Current Portion | | | | | 143,749 | | | | | | 276,154 | | |
Lease Liabilities, net of Current Portion | | | | | 66,122 | | | | | | 56,812 | | |
Deferred Income Taxes | | | | | 259,326 | | | | | | 262,184 | | |
Total Long-Term Liabilities | | | | | 469,468 | | | | | | 596,333 | | |
TOTAL LIABILITIES | | | | $ | 1,056,245 | | | | | $ | 1,066,849 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,548,725 | | | | | | 1,480,530 | | |
NON-CONTROLLING INTEREST | | | | | — | | | | | | 1,276 | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,604,970 | | | | | $ | 2,548,655 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Revenues, net of Discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | $ | 425,897 | | | | | $ | 319,961 | | |
Cost of Goods Sold, net | | | | | 125,547 | | | | | | 129,856 | | | | | | 229,165 | | | | | | 196,461 | | |
Gross Profit | | | | | 98,115 | | | | | | 69,210 | | | | | | 196,732 | | | | | | 123,500 | | |
Selling, General, and Administrative Expenses | | | | | 100,263 | | | | | | 70,013 | | | | | | 189,824 | | | | | | 112,679 | | |
Income (Loss) from Investments in Associates | | | | | (144) | | | | | | 645 | | | | | | 1,860 | | | | | | 1,448 | | |
Income (Loss) from Operations | | | | | (2,292) | | | | | | (158) | | | | | | 8,768 | | | | | | 12,269 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | (203) | | | | | | (429) | | | | | | (1,192) | | | | | | (429) | | |
Gain (Loss) on Deconsolidation | | | | | (73) | | | | | | — | | | | | | 9,485 | | | | | | — | | |
Gain (Loss) on Previously Held Equity Interest | | | | | (171) | | | | | | — | | | | | | 13,928 | | | | | | — | | |
Interest Expense, net | | | | | (11,624) | | | | | | (5,434) | | | | | | (22,295) | | | | | | (7,201) | | |
Other Income (Expense), net | | | | | 15,619 | | | | | | (131) | | | | | | 18,153 | | | | | | (997) | | |
Total Other Income (Expense) | | | | | 3,548 | | | | | | (5,994) | | | | | | 18,079 | | | | | | (8,627) | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 1,256 | | | | | | (6,152) | | | | | | 26,847 | | | | | | 3,642 | | |
Provision For Income Taxes | | | | | (11,103) | | | | | | (23,438) | | | | | | (36,617) | | | | | | (39,852) | | |
Net Loss Before Non-Controlling Interest | | | | | (9,847) | | | | | | (29,590) | | | | | | (9,770) | | | | | | (36,210) | | |
Net Income Attributable to Non-Controlling Interest | | | | | — | | | | | | 98 | | | | | | 291 | | | | | | 1,364 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (9,847) | | | | | $ | (29,688) | | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Net Loss per share – basic | | | | | (0.03) | | | | | | (0.10) | | | | | | (0.03) | | | | | | (0.14) | | |
Net Loss per share – diluted | | | | | (0.03) | | | | | | (0.10) | | | | | | (0.03) | | | | | | (0.14) | | |
Basic – weighted average shares outstanding | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Diluted – weighted average shares outstanding | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of April 1, 2021 (As Restated) | | | | | — | | | | | | 293,199,219 | | | | | $ | 1,030,163 | | | | | $ | 1,361 | | | | | $ | 7,403 | | | | | $ | 1,038,927 | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 14,483 | | | | | | — | | | | | | — | | | | | | 14,483 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 10,410,187 | | | | | | 207,136 | | | | | | — | | | | | | — | | | | | | 207,136 | | |
Issuance of warrants | | | | | — | | | | | | 3,510,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 103,775 | | | | | | 2,085 | | | | | | — | | | | | | — | | | | | | 2,085 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (29,688) | | | | | | 98 | | | | | | (29,590) | | |
Balance as of June 30, 2021 | | | | | — | | | | | | 307,223,181 | | | | | $ | 1,253,867 | | | | | $ | (28,327) | | | | | $ | 7,501 | | | | | $ | 1,233,041 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of April 1, 2022 (As Restated) | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,578,232 | | | | | $ | (55,449) | | | | | $ | — | | | | | $ | 1,522,783 | | |
Share-based compensation | | | | | — | | | | | | 26,570 | | | | | | 12,523 | | | | | | — | | | | | | — | | | | | | 12,523 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 808,258 | | | | | | 5,540 | | | | | | — | | | | | | — | | | | | | 5,540 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 2,115,438 | | | | | | 17,726 | | | | | | — | | | | | | — | | | | | | 17,726 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (9,847) | | | | | | — | | | | | | (9,847) | | |
Balance as of June 30, 2022 | | | | | — | | | | | | 330,818,664 | | | | | $ | 1,614,021 | | | | | $ | (65,296) | | | | | $ | — | | | | | $ | 1,548,725 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2021 | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,000) | | | | | | 279,900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority members | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 21,097 | | | | | | — | | | | | | — | | | | | | 21,097 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 13,609,406 | | | | | | 270,034 | | | | | | — | | | | | | — | | | | | | 270,034 | | |
Warrants issued and exercised | | | | | — | | | | | | 3,510,000 | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 103,775 | | | | | | 2,085 | | | | | | — | | | | | | — | | | | | | 2,085 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (37,574) | | | | | | 1,364 | | | | | | (36,210) | | |
Balance as of June 30, 2021 | | | | | — | | | | | | 307,223,181 | | | | | $ | 1,253,867 | | | | | $ | (28,327) | | | | | $ | 7,501 | | | | | $ | 1,233,041 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2022 (As Restated) | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
Share-based compensation | | | | | — | | | | | | 797,907 | | | | | | 24,265 | | | | | | — | | | | | | — | | | | | | 24,265 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 2,211,325 | | | | | | 18,760 | | | | | | — | | | | | | — | | | | | | 18,760 | | |
Non-controlling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,567) | | | | | | (1,567) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 3,496,770 | | | | | | 35,231 | | | | | | — | | | | | | — | | | | | | 35,231 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (10,061) | | | | | | 291 | | | | | | (9,770) | | |
Balance as of June 30, 2022 | | | | | — | | | | | | 330,818,664 | | | | | $ | 1,614,021 | | | | | $ | (65,296) | | | | | $ | — | | | | | $ | 1,548,725 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Net income attributable to non-controlling interest | | | | | 291 | | | | | | 1,364 | | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 69,911 | | | | | | 36,057 | | |
Non-cash interest expense | | | | | 1,016 | | | | | | 2,907 | | |
Non-cash interest income | | | | | — | | | | | | (17) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 6,707 | | | | | | 52,189 | | |
Loss on disposal of property, plant and equipment | | | | | 1,192 | | | | | | 429 | | |
Gain on deconsolidation | | | | | (9,485) | | | | | | — | | |
Gain on disposal of investments in associates | | | | | (13,928) | | | | | | — | | |
Bad debt expense | | | | | — | | | | | | 68 | | |
Amortization of debt issuance costs | | | | | 3,160 | | | | | | 517 | | |
Unrealized gain on marketable securities | | | | | 2,148 | | | | | | — | | |
Loss (income) from underlying investees | | | | | (310) | | | | | | (7,319) | | |
Stock earnout from acquisitions | | | | | — | | | | | | 2,084 | | |
Loss (income) on share issuance | | | | | (4,650) | | | | | | 1,236 | | |
Decrease in fair value of contingent consideration | | | | | (9,102) | | | | | | — | | |
Stock based compensation | | | | | 24,405 | | | | | | 18,333 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | |
Accounts receivable | | | | | 4,157 | | | | | | (900) | | |
Inventory | | | | | (19,927) | | | | | | (23,023) | | |
Prepaid expenses and other current assets | | | | | (6,333) | | | | | | 138 | | |
Deposits and other assets | | | | | 4,384 | | | | | | 2,935 | | |
Accounts payable | | | | | 14,686 | | | | | | (9,242) | | |
Accrued liabilities | | | | | (9,880) | | | | | | (10,668) | | |
Lease liabilities | | | | | (6,468) | | | | | | (2,383) | | |
Income tax payable | | | | | 5,508 | | | | | | 31,536 | | |
Deferred taxes | | | | | (2,857) | | | | | | (531) | | |
Deferred revenue | | | | | (913) | | | | | | (1,305) | | |
Other, net | | | | | (3) | | | | | | 14 | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 43,648 | | | | | | 56,845 | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (86,851) | | | | | | (61,785) | | |
Proceeds from disposal of assets | | | | | 1,841 | | | | | | 778 | | |
Distributions to minority members | | | | | — | | | | | | (100) | | |
Purchases of intangible assets | | | | | — | | | | | | (8,378) | | |
Acquisition of business, net of cash acquired | | | | | (94,042) | | | | | | (102,138) | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Proceeds from sale of deconsolidation and investment in associates | | | | | 19,576 | | | | | | — | | |
Purchase of interest in investment in associates | | | | | — | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | — | | | | | | 10,275 | | |
Proceeds from note receivable | | | | | — | | | | | | 4,215 | | |
Other, net | | | | | — | | | | | | 41 | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (159,476) | | | | | | (160,442) | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | | 120,774 | | | | | | 100,000 | | |
Principal repayments of notes payable | | | | | (8,245) | | | | | | (8,527) | | |
Debt issuance costs paid | | | | | (2,986) | | | | | | (5,132) | | |
Proceeds received from RTO Financing, net | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 109,543 | | | | | | 236,861 | | |
NET INCREASE (DECREASE) IN CASH | | | | | (6,285) | | | | | | 133,264 | | |
CASH, BEGINNING OF PERIOD | | | | | 99,118 | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 92,833 | | | | | $ | 149,666 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | |
Interest paid | | | | $ | 10,608 | | | | | $ | 1,761 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 3,296 | | | | | $ | 3,627 | | |
Issuance of shares under business combinations | | | | $ | 53,950 | | | | | $ | 896,795 | | |
Acquisitions | | | | | | | | | | | | | |
Tangible and intangible assets acquired, net of cash | | | | $ | 17,533 | | | | | $ | 1,127,009 | | |
Liabilities assumed | | | | | (4,362) | | | | | | (249,094) | | |
Acquisition consideration payable | | | | | 72,364 | | | | | | (1,038,668) | | |
Goodwill | | | | | 8,507 | | | | | | 262,891 | | |
| | | | $ | 94,042 | | | | | $ | 102,138 | | |
|
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
| | | | | | | | | (As Restated) | | |||
Raw Materials | | | | $ | 8,369 | | | | | $ | 5,767 | | |
Work in Process | | | | | 109,219 | | | | | | 96,367 | | |
Finished Goods | | | | | 36,462 | | | | | | 38,569 | | |
Total Inventories | | | | $ | 154,050 | | | | | $ | 140,703 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Land | | | | $ | 29,878 | | | | | $ | 29,399 | | |
Buildings and Improvements | | | | | 170,842 | | | | | | 126,020 | | |
Furniture and Fixtures | | | | | 15,900 | | | | | | 13,259 | | |
Computer Equipment and Software | | | | | 19,074 | | | | | | 14,078 | | |
Leasehold Improvements | | | | | 188,038 | | | | | | 182,514 | | |
Tools and Equipment | | | | | 79,768 | | | | | | 65,774 | | |
Vehicles | | | | | 4,716 | | | | | | 3,229 | | |
Assets Under Construction(1) | | | | | 73,311 | | | | | | 64,107 | | |
Total Property, Plant and Equipment | | | | | 581,527 | | | | | | 498,380 | | |
Less: Accumulated Depreciation | | | | | (65,829) | | | | | | (46,148) | | |
Property, Plant and Equipment, Net | | | | $ | 515,698 | | | | | $ | 452,232 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | $ | 1,386,131 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,451,900 | | |
Purchases | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Additions from business combination | | | | | 13,281 | | | | | | — | | | | | | — | | | | | | 13,281 | | |
Adjustments to purchase price allocation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Disposals | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Balance as of June 30, 2022 | | | | $ | 1,399,412 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,465,181 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Accumulated Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 66,703 | | | | | | 4,158 | | | | | | 1,126 | | | | | | 71,987 | | |
Amortization | | | | | 46,499 | | | | | | 2,710 | | | | | | 614 | | | | | | 49,823 | | |
Balance as of June 30, 2022 | | | | $ | 113,202 | | | | | $ | 6,868 | | | | | $ | 1,740 | | | | | $ | 121,810 | | |
Net Book Value | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 1,319,428 | | | | | | 50,008 | | | | | | 10,477 | | | | | | 1,379,913 | | |
Balance as of June 30, 2022 | | | | $ | 1,286,210 | | | | | $ | 47,298 | | | | | $ | 9,863 | | | | | $ | 1,343,371 | | |
|
Year Ending December 31: | | | Estimated Amortization | | |||
2022 (Remaining) | | | | $ | 49,975 | | |
2023 | | | | | 99,948 | | |
2024 | | | | | 99,948 | | |
2025 | | | | | 99,948 | | |
2026 | | | | | 99,221 | | |
Thereafter | | | | | 894,331 | | |
| | | | $ | 1,343,371 | | |
| | | January 1, 2022 | | | Impairment | | | Adjustments to purchase price allocation | | | Acquisitions | | | June 30, 2022 | | |||||||||||||||
Cultivation | | | | $ | 91,116 | | | | | $ | — | | | | | $ | 1,050 | | | | | $ | — | | | | | $ | 92,166 | | |
Retail | | | | | 277,014 | | | | | | — | | | | | | 912 | | | | | | 6,545 | | | | | | 284,471 | | |
Total | | | | $ | 368,130 | | | | | $ | — | | | | | $ | 1,962 | | | | | $ | 6,545 | | | | | $ | 376,637 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Numerator | | | | | | | | | | | | | | | | | | | | | | | | | |
Net Loss attributable to Verano Holdings Corp. | | | | $ | (9,847) | | | | | $ | (29,688) | | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Denominator | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | | | | | | | | | | | | | | | | | | | 158,203,932 | | |
Post-RTO weighted-average shares outstanding | | | | | | | | | | | 300,715,671 | | | | | | | | | | | | 297,365,427 | | |
Weighted-average shares outstanding – basic | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Diluted | | | | | | | | | | | | | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | | | | | | | | | | | | | | | | | | | 158,203,932 | | |
Post-RTO weighted-average shares outstanding | | | | | | | | | | | 300,715,671 | | | | | | | | | | | | 297,365,427 | | |
Weighted-average shares outstanding – diluted | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Basic earnings per share | | | | $ | (0.03) | | | | | $ | (0.10) | | | | | $ | (0.03) | | | | | $ | (0.14) | | |
Diluted earnings per share | | | | $ | (0.03) | | | | | $ | (0.10) | | | | | $ | (0.03) | | | | | $ | (0.14) | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
Cash | | | | $ | 5,446 | | | | | $ | 507 | | | | | $ | 5,953 | | |
Accounts receivable, net | | | | | 60 | | | | | | 498 | | | | | | 558 | | |
Inventory | | | | | 83,205 | | | | | | 5,827 | | | | | | 89,032 | | |
Prepaids and other current assets | | | | | 833 | | | | | | 1,989 | | | | | | 2,822 | | |
Property, plant and equipment, net | | | | | 73,386 | | | | | | 9,751 | | | | | | 83,137 | | |
Right-of-use asset, net | | | | | 9,651 | | | | | | — | | | | | | 9,651 | | |
Other assets | | | | | 1,001 | | | | | | — | | | | | | 1,001 | | |
Accounts payable and accrued liabilities | | | | | (8,935) | | | | | | (2,576) | | | | | | (11,511) | | |
Notes payable | | | | | (3,579) | | | | | | (3,343) | | | | | | (6,922) | | |
Deferred taxes | | | | | (123,720) | | | | | | (37,290) | | | | | | (161,010) | | |
Lease liabilities | | | | | (9,651) | | | | | | — | | | | | | (9,651) | | |
Total identifiable net assets (liabilities) | | | | | 27,697 | | | | | | (24,637) | | | | | | 3,060 | | |
Intangible assets | | | | | 498,938 | | | | | | 184,588 | | | | | | 683,526 | | |
Net assets | | | | $ | 526,635 | | | | | $ | 159,951 | | | | | $ | 686,586 | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
License | | | | $ | 319,928 | | | | | $ | 130,670 | | | | | $ | 450,598 | | |
Tradename | | | | | 36,278 | | | | | | 8,980 | | | | | | 45,258 | | |
Intellectual Property and Technology | | | | | 10,603 | | | | | | 885 | | | | | | 11,488 | | |
Total intangible assets | | | | | 366,809 | | | | | | 140,535 | | | | | | 507,344 | | |
Goodwill (residual purchase price) | | | | | 8,409 | | | | | | 6,763 | | | | | | 15,172 | | |
Goodwill (deferred taxes)(a) | | | | | 123,720 | | | | | | 37,290 | | | | | | 161,010 | | |
Total goodwill | | | | $ | 132,129 | | | | | $ | 44,053 | | | | | $ | 176,182 | | |
| | | Consolidated Results | | | AltMed Pre-acquisition | | | Pro-forma Results | | |||||||||
Revenues, net of discounts | | | | $ | 319,961 | | | | | $ | 22,402 | | | | | $ | 342,363 | | |
Net income (loss) | | | | | (37,574) | | | | | | 10,933 | | | | | | (26,641) | | |
| | | Greengate | | |||
Cash and cash equivalents | | | | $ | 2,315 | | |
Inventory | | | | | 1,021 | | |
Prepaid & other current Assets | | | | | 324 | | |
Deposits and Other non-current assets | | | | | 45 | | |
Property, plant and equipment, net | | | | | 1,673 | | |
Right-of-use asset, Net | | | | | 1,836 | | |
Accounts payable and accrued liabilities | | | | | (1,569) | | |
Other liabilities | | | | | (72) | | |
Lease liabilities | | | | | (1,836) | | |
Total identifiable net assets (liabilities) | | | | | 3,737 | | |
Total Intangible assets | | | | | 19,826 | | |
| | | Six Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 186,106 | | | | | $ | 89,400 | | | | | $ | 44,455 | | | | | $ | 319,961 | | |
Net loss | | | | | (25,733) | | | | | | (9,570) | | | | | | (2,271) | | | | | | (37,574) | | |
| | | Three Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 99,294 | | | | | $ | 57,277 | | | | | $ | 42,495 | | | | | $ | 199,066 | | |
Net loss | | | | | (23,619) | | | | | | (4,180) | | | | | | (1,889) | | | | | | (29,688) | | |
| | | Six Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 186,106 | | | | | $ | 111,802 | | | | | $ | 133,091 | | | | | $ | 430,999 | | |
Pro forma net income (loss) | | | | | (25,733) | | | | | | 1,362 | | | | | | 19,785 | | | | | | (4,586) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) intangible amortization | | | | | — | | | | | | 14,899 | | | | | | 6,712 | | | | | | 21,611 | | |
(b) intangible amortization | | | | | — | | | | | | 45,797 | | | | | | 6,392 | | | | | | 52,189 | | |
Total pro forma adjustments | | | | | — | | | | | | 60,696 | | | | | | 13,104 | | | | | | 73,800 | | |
Total pro forma net income (loss) | | | | $ | (25,733) | | | | | $ | 62,058 | | | | | $ | 32,889 | | | | | $ | 69,214 | | |
| | | Three Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 99,294 | | | | | $ | 57,277 | | | | | $ | 60,001 | | | | | $ | 216,572 | | |
Pro forma net income (loss) | | | | | (23,619) | | | | | | (4,180) | | | | | | 2,477 | | | | | | (25,322) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) intangible amortization | | | | | — | | | | | | 8,939 | | | | | | 6,224 | | | | | | 15,163 | | |
(b) intangible amortization | | | | | — | | | | | | 27,952 | | | | | | 6,392 | | | | | | 34,344 | | |
Total pro forma adjustments | | | | | — | | | | | | 36,891 | | | | | | 12,616 | | | | | | 49,507 | | |
Total pro forma net income (loss) | | | | $ | (23,619) | | | | | $ | 32,711 | | | | | $ | 15,093 | | | | | $ | 24,185 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Credit Facility | | | | $ | 350,000 | | | | | $ | 250,000 | | |
Secured Promissory Notes | | | | | 1,668 | | | | | | 6,663 | | |
Mortgage Loans | | | | | 56,122 | | | | | | 38,856 | | |
Vehicle and Equipment Loans | | | | | 2,209 | | | | | | 1,951 | | |
Unamortized Debt Issuance Costs | | | | | (7,370) | | | | | | (7,545) | | |
Total Notes Payable | | | | $ | 402,629 | | | | | $ | 289,925 | | |
Less: Current Portion of Notes Payable | | | | | 258,880 | | | | | | 13,771 | | |
Total Long-Term Debt, net | | | | $ | 143,749 | | | | | $ | 276,154 | | |
| | | Number of Shares | | | Weighted Avg. Exercise Price C$ | | | Weighted Average Remaining Contractual Life | | |||||||||
Balance as of December 31, 2021 | | | | | 56,078 | | | | | | 30.60 | | | | | | 9.16 | | |
Vested | | | | | 18,798 | | | | | | 30.60 | | | | | ||||
Exercisable at June 30, 2022 | | | | | 24,167 | | | | | | 30.60 | | | | | | 8.67 | | |
| | | Number of Shares | | | Weighted Avg. Grant Date Fair Value C$ | | ||||||
Unvested Shares at December 31, 2021 | | | | | 2,413,887 | | | | | | 30.49 | | |
Granted | | | | | 2,748,440 | | | | | | 10.57 | | |
Forfeited | | | | | 975 | | | | | | 23.97 | | |
Vested | | | | | 1,189,055 | | | | | | 30.65 | | |
Unvested Shares at June 30, 2022 | | | | | 3,972,297 | | | | | | 16.66 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Weighted average grant date fair value (per share) of RSUs granted (C$) | | | | | 16.66 | | | | | | 30.60 | | |
Intrinsic value of RSUs vested, using market price at vest date (C$) (in thousands) | | | | | 15.41 | | | | | | — | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Stock Options Expense | | | | $ | 62 | | | | | $ | 115 | | | | | $ | 125 | | | | | $ | 168 | | |
Restricted Stock Units | | | | | 13,430 | | | | | | 12,465 | | | | | | 24,280 | | | | | | 18,165 | | |
Total Stock Based Compensation Expense | | | | $ | 13,492 | | | | | $ | 12,580 | | | | | $ | 24,405 | | | | | $ | 18,333 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Income before Income Taxes | | | | $ | 1,256 | | | | | $ | (6,152) | | | | | $ | 26,847 | | | | | $ | 3,642 | | |
Income Tax Expense | | | | | (11,103) | | | | | | (23,438) | | | | | | (36,617) | | | | | | (39,852) | | |
Effective Tax Rate | | | | | 662.9% | | | | | | 381.0% | | | | | | 112.3% | | | | | | 1093.8% | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Weighted average remaining lease term (years) | | | | | 8.26 | | | | | | 8.52 | | |
Weighted average discount rate | | | | | 8.03% | | | | | | 8.11% | | |
Year Ending December 31, | | | | | | | | | | | | | |
Remainder 2022 | | | | $ | 6,851 | | | | | $ | 11,457 | | |
2023 | | | | | 13,244 | | | | | | 11,024 | | |
2024 | | | | | 12,519 | | | | | | 10,348 | | |
2025 | | | | | 11,590 | | | | | | 9,717 | | |
2026 | | | | | 10,722 | | | | | | 8,818 | | |
2027 and Thereafter | | | | | 47,894 | | | | | | 38,177 | | |
Total Lease Payments | | | | | 102,820 | | | | | | 89,541 | | |
Less: Interest | | | | | (28,737) | | | | | | (26,166) | | |
Present Value of Lease Liability | | | | $ | 74,083 | | | | | $ | 63,375 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Revenue, net of discounts | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 67,673 | | | | | $ | 59,312 | | | | | $ | 120,681 | | | | | $ | 108,473 | | |
Retail | | | | | 185,308 | | | | | | 156,873 | | | | | | 349,642 | | | | | | 236,068 | | |
Intersegment Eliminations | | | | | (29,319) | | | | | | (17,119) | | | | | | (44,426) | | | | | | (24,580) | | |
Total Revenue, net of discounts | | | | | 223,662 | | | | | | 199,066 | | | | | | 425,897 | | | | | | 319,961 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Depreciation and Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 19,089 | | | | | | 13,963 | | | | | | 38,814 | | | | | | 22,282 | | |
Retail | | | | | 16,388 | | | | | | 10,311 | | | | | | 31,097 | | | | | | 13,775 | | |
Total Depreciation and Amortization | | | | | 35,477 | | | | | | 24,274 | | | | | | 69,911 | | | | | | 36,057 | | |
Income taxes | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 1,265 | | | | | | 8,080 | | | | | | 12,502 | | | | | | 11,776 | | |
Retail | | | | | 9,838 | | | | | | 15,358 | | | | | | 24,115 | | | | | | 28,076 | | |
Total Income Taxes | | | | | 11,103 | | | | | | 23,438 | | | | | | 36,617 | | | | | | 39,852 | | |
|
| | | Consolidated VIE | | | Consolidated VOE | | | Consolidated VIE | | | Consolidated VOE | | ||||||||||||
| | | June 30, 2022 | | | December 31, 2021 | | ||||||||||||||||||
| | | | | | | | | | | | | | | (As Restated) | | |||||||||
Current Assets | | | | $ | 43,362 | | | | | $ | — | | | | | $ | 43,045 | | | | | $ | 20,464 | | |
Due To/(From) | | | | | (68,307) | | | | | | — | | | | | | (25,723) | | | | | | 14,228 | | |
Non-Current Assets | | | | | 96,342 | | | | | | — | | | | | | 207,908 | | | | | | 226,108 | | |
Current Liabilities | | | | | 14,359 | | | | | | — | | | | | | 32,934 | | | | | | 22,659 | | |
Non-Current Liabilities | | | | | 11,134 | | | | | | — | | | | | | 45,873 | | | | | | 45,603 | | |
Non-Controlling Interest | | | | | — | | | | | | — | | | | | | 1,276 | | | | | | — | | |
Equity attributable to Verano Holdings, Corp. | | | | | 45,904 | | | | | | — | | | | | | 145,147 | | | | | | 192,538 | | |
| | | As of June 30, 2022 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 92,833 | | | | | $ | — | | | | | $ | — | | | | | $ | 92,833 | | |
Investments | | | | | 3,842 | | | | | | — | | | | | | — | | | | | | 3,842 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (66,901) | | | | | | (66,901) | | |
Total | | | | $ | 96,675 | | | | | $ | — | | | | | $ | (66,901) | | | | | $ | 29,774 | | |
| | | As of December 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 99,118 | | | | | $ | — | | | | | $ | — | | | | | $ | 99,118 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (208,349) | | | | | | (208,349) | | |
Total | | | | $ | 99,118 | | | | | $ | — | | | | | $ | (208,349) | | | | | $ | (109,231) | | |
| | | For the Three Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Revenue, net of discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | $ | 24,596 | | |
Gross Profit | | | | | 98,115 | | | | | | 69,210 | | | | | | 28,905 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (9,847) | | | | | | (29,688) | | | | | | 19,841 | | |
Net Loss per share – basic & diluted | | | | | (0.03) | | | | | | (0.10) | | | | | | 0.07 | | |
| | | Three Months Ended June 30, | | | 2022 — 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Cost of Goods Sold, net | | | | $ | 125,547 | | | | | $ | 129,856 | | | | | $ | (4,309) | | |
Selling, General, and Administrative Expenses | | | | | 100,263 | | | | | | 70,013 | | | | | | 30,250 | | |
Other Income (Expense) | | | | | 3,548 | | | | | | (5,994) | | | | | | 9,542 | | |
Provision for Income Taxes | | | | | (11,103) | | | | | | (23,438) | | | | | | 12,335 | | |
| | | For the Six Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Revenue, net of discounts | | | | $ | 425,897 | | | | | $ | 319,961 | | | | | $ | 105,936 | | |
Gross Profit | | | | | 196,732 | | | | | | 123,500 | | | | | | 73,232 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (10,061) | | | | | | (37,574) | | | | | | 27,513 | | |
Net Loss per share – basic & diluted | | | | | (0.03) | | | | | | (0.14) | | | | | | 0.11 | | |
| | | Six Months Ended June 30, | | | 2022 — 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Cost of goods sold, net | | | | $ | 229,165 | | | | | $ | 196,461 | | | | | $ | 32,704 | | |
Selling, General, and Administrative Expense | | | | | 189,824 | | | | | | 112,679 | | | | | | 77,145 | | |
Other Income (Expense) | | | | | 18,079 | | | | | | (8,627) | | | | | | 26,706 | | |
Provision for Income Taxes | | | | | (36,617) | | | | | | (39,852) | | | | | | 3,235 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Net Cash Provided by Operating Activities | | | | $ | 34,457 | | | | | $ | 24,930 | | |
Net Cash Used in Investing Activities | | | | | (86,743) | | | | | | (72,068) | | |
Net Cash Provided by Financing Activities | | | | | 92,805 | | | | | | 143,004 | | |
| | | Years ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Net Cash Provided by (Used in) Operating Activities | | | | $ | 182,872 | | | | | $ | 71,627 | | | | | $ | (6,660) | | |
Net Cash (Used in) Investing Activities | | | | | (455,832) | | | | | | (86,908) | | | | | | (84,118) | | |
Net Cash Provided by Financing Activities | | | | | 355,676 | | | | | | 25,266 | | | | | | 24,108 | | |
| | | Payments Due by Period | | |||||||||||||||||||||||||||
Contractual Obligations | | | Total | | | Less than 1 year | | | 1-2 years | | | 3-4 years | | | 5 years and after | | |||||||||||||||
Long Term Debt(1) | | | | $ | 289,924 | | | | | $ | 13,771 | | | | | $ | 265,867 | | | | | $ | 2,108 | | | | | $ | 8,178 | | |
Operating Leases | | | | $ | 89,541 | | | | | $ | 11,457 | | | | | $ | 21,372 | | | | | $ | 18,534 | | | | | $ | 38,178 | | |
Purchase Obligations(2) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Other Long Term Obligations(3) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Total Contractual Obligations | | | | $ | 379,465 | | | | | $ | 25,228 | | | | | $ | 287,239 | | | | | $ | 20,642 | | | | | $ | 46,356 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
| | | (Unaudited) | | | (As Restated) | | ||||||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and Cash Equivalents | | | | $ | 92,833 | | | | | $ | 99,118 | | |
Accounts Receivable, net | | | | | 13,253 | | | | | | 17,410 | | |
Notes Receivable | | | | | — | | | | | | 285 | | |
Inventory | | | | | 154,050 | | | | | | 140,703 | | |
Prepaid Expenses and Other Current Assets | | | | | 27,820 | | | | | | 19,528 | | |
Total Current Assets | | | | | 287,956 | | | | | | 277,044 | | |
Property, Plant and Equipment, net | | | | | 515,698 | | | | | | 452,232 | | |
Right of Use Assets, net | | | | | 71,472 | | | | | | 61,346 | | |
Intangible Assets, net | | | | | 1,343,371 | | | | | | 1,379,913 | | |
Goodwill | | | | | 376,637 | | | | | | 368,130 | | |
Investment in Associates | | | | | 7,252 | | | | | | 7,491 | | |
Deposits and Other Assets | | | | | 2,584 | | | | | | 2,499 | | |
TOTAL ASSETS | | | | $ | 2,604,970 | | | | | $ | 2,548,655 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 60,832 | | | | | $ | 45,172 | | |
Accrued Liabilities | | | | | 30,773 | | | | | | 42,149 | | |
Income Tax Payable | | | | | 161,430 | | | | | | 154,512 | | |
Current Portion of Lease Liabilities | | | | | 7,961 | | | | | | 6,563 | | |
Current Portion of Notes Payable | | | | | 258,880 | | | | | | 13,771 | | |
Acquisition Consideration Payable | | | | | 66,901 | | | | | | 208,349 | | |
Total Current Liabilities | | | | | 586,777 | | | | | | 470,516 | | |
Long-Term Liabilities: | | | | | | | | | | | | | |
Deferred Revenue | | | | | 271 | | | | | | 1,183 | | |
Notes Payable, net of Current Portion | | | | | 143,749 | | | | | | 276,154 | | |
Lease Liabilities, net of Current Portion | | | | | 66,122 | | | | | | 56,812 | | |
Deferred Income Taxes | | | | | 259,326 | | | | | | 262,184 | | |
Total Long-Term Liabilities | | | | | 469,468 | | | | | | 596,333 | | |
TOTAL LIABILITIES | | | | $ | 1,056,245 | | | | | $ | 1,066,849 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,548,725 | | | | | | 1,480,530 | | |
NON-CONTROLLING INTEREST | | | | | — | | | | | | 1,276 | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,604,970 | | | | | $ | 2,548,655 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Revenues, net of Discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | $ | 425,897 | | | | | $ | 319,961 | | |
Cost of Goods Sold, net | | | | | 125,547 | | | | | | 129,856 | | | | | | 229,165 | | | | | | 196,461 | | |
Gross Profit | | | | | 98,115 | | | | | | 69,210 | | | | | | 196,732 | | | | | | 123,500 | | |
Selling, General, and Administrative Expenses | | | | | 100,263 | | | | | | 70,013 | | | | | | 189,824 | | | | | | 112,679 | | |
Income (Loss) from Investments in Associates | | | | | (144) | | | | | | 645 | | | | | | 1,860 | | | | | | 1,448 | | |
Income (Loss) from Operations | | | | | (2,292) | | | | | | (158) | | | | | | 8,768 | | | | | | 12,269 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | (203) | | | | | | (429) | | | | | | (1,192) | | | | | | (429) | | |
Gain (Loss) on Deconsolidation | | | | | (73) | | | | | | — | | | | | | 9,485 | | | | | | — | | |
Gain (Loss) on Previously Held Equity Interest | | | | | (171) | | | | | | — | | | | | | 13,928 | | | | | | — | | |
Interest Expense, net | | | | | (11,624) | | | | | | (5,434) | | | | | | (22,295) | | | | | | (7,201) | | |
Other Income (Expense), net | | | | | 15,619 | | | | | | (131) | | | | | | 18,153 | | | | | | (997) | | |
Total Other Income (Expense) | | | | | 3,548 | | | | | | (5,994) | | | | | | 18,079 | | | | | | (8,627) | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 1,256 | | | | | | (6,152) | | | | | | 26,847 | | | | | | 3,642 | | |
Provision For Income Taxes | | | | | (11,103) | | | | | | (23,438) | | | | | | (36,617) | | | | | | (39,852) | | |
Net Loss Before Non-Controlling Interest | | | | | (9,847) | | | | | | (29,590) | | | | | | (9,770) | | | | | | (36,210) | | |
Net Income Attributable to Non-Controlling Interest | | | | | — | | | | | | 98 | | | | | | 291 | | | | | | 1,364 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (9,847) | | | | | $ | (29,688) | | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Net Loss per share – basic | | | | | (0.03) | | | | | | (0.10) | | | | | | (0.03) | | | | | | (0.14) | | |
Net Loss per share – diluted | | | | | (0.03) | | | | | | (0.10) | | | | | | (0.03) | | | | | | (0.14) | | |
Basic – weighted average shares outstanding | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Diluted – weighted average shares outstanding | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of April 1, 2021 (As Restated) | | | | | — | | | | | | 293,199,219 | | | | | $ | 1,030,163 | | | | | $ | 1,361 | | | | | $ | 7,403 | | | | | $ | 1,038,927 | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 14,483 | | | | | | — | | | | | | — | | | | | | 14,483 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 10,410,187 | | | | | | 207,136 | | | | | | — | | | | | | — | | | | | | 207,136 | | |
Issuance of warrants | | | | | — | | | | | | 3,510,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 103,775 | | | | | | 2,085 | | | | | | — | | | | | | — | | | | | | 2,085 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (29,688) | | | | | | 98 | | | | | | (29,590) | | |
Balance as of June 30, 2021 | | | | | — | | | | | | 307,223,181 | | | | | $ | 1,253,867 | | | | | $ | (28,327) | | | | | $ | 7,501 | | | | | $ | 1,233,041 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of April 1, 2022 (As Restated) | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,578,232 | | | | | $ | (55,449) | | | | | $ | — | | | | | $ | 1,522,783 | | |
Share-based compensation | | | | | — | | | | | | 26,570 | | | | | | 12,523 | | | | | | — | | | | | | — | | | | | | 12,523 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 808,258 | | | | | | 5,540 | | | | | | — | | | | | | — | | | | | | 5,540 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 2,115,438 | | | | | | 17,726 | | | | | | — | | | | | | — | | | | | | 17,726 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (9,847) | | | | | | — | | | | | | (9,847) | | |
Balance as of June 30, 2022 | | | | | — | | | | | | 330,818,664 | | | | | $ | 1,614,021 | | | | | $ | (65,296) | | | | | $ | — | | | | | $ | 1,548,725 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2021 | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,000) | | | | | | 279,900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority members | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 21,097 | | | | | | — | | | | | | — | | | | | | 21,097 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 13,609,406 | | | | | | 270,034 | | | | | | — | | | | | | — | | | | | | 270,034 | | |
Warrants issued and exercised | | | | | — | | | | | | 3,510,000 | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 103,775 | | | | | | 2,085 | | | | | | — | | | | | | — | | | | | | 2,085 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (37,574) | | | | | | 1,364 | | | | | | (36,210) | | |
Balance as of June 30, 2021 | | | | | — | | | | | | 307,223,181 | | | | | $ | 1,253,867 | | | | | $ | (28,327) | | | | | $ | 7,501 | | | | | $ | 1,233,041 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2022 (As Restated) | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
Share-based compensation | | | | | — | | | | | | 797,907 | | | | | | 24,265 | | | | | | — | | | | | | — | | | | | | 24,265 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 2,211,325 | | | | | | 18,760 | | | | | | — | | | | | | — | | | | | | 18,760 | | |
Non-controlling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,567) | | | | | | (1,567) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 3,496,770 | | | | | | 35,231 | | | | | | — | | | | | | — | | | | | | 35,231 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (10,061) | | | | | | 291 | | | | | | (9,770) | | |
Balance as of June 30, 2022 | | | | | — | | | | | | 330,818,664 | | | | | $ | 1,614,021 | | | | | $ | (65,296) | | | | | $ | — | | | | | $ | 1,548,725 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Net income attributable to non-controlling interest | | | | | 291 | | | | | | 1,364 | | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 69,911 | | | | | | 36,057 | | |
Non-cash interest expense | | | | | 1,016 | | | | | | 2,907 | | |
Non-cash interest income | | | | | — | | | | | | (17) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 6,707 | | | | | | 52,189 | | |
Loss on disposal of property, plant and equipment | | | | | 1,192 | | | | | | 429 | | |
Gain on deconsolidation | | | | | (9,485) | | | | | | — | | |
Gain on disposal of investments in associates | | | | | (13,928) | | | | | | — | | |
Bad debt expense | | | | | — | | | | | | 68 | | |
Amortization of debt issuance costs | | | | | 3,160 | | | | | | 517 | | |
Unrealized gain on marketable securities | | | | | 2,148 | | | | | | — | | |
Loss (income) from underlying investees | | | | | (310) | | | | | | (7,319) | | |
Stock earnout from acquisitions | | | | | — | | | | | | 2,084 | | |
Loss (income) on share issuance | | | | | (4,650) | | | | | | 1,236 | | |
Decrease in fair value of contingent consideration | | | | | (9,102) | | | | | | — | | |
Stock based compensation | | | | | 24,405 | | | | | | 18,333 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | |
Accounts receivable | | | | | 4,157 | | | | | | (900) | | |
Inventory | | | | | (19,927) | | | | | | (23,023) | | |
Prepaid expenses and other current assets | | | | | (6,333) | | | | | | 138 | | |
Deposits and other assets | | | | | 4,384 | | | | | | 2,935 | | |
Accounts payable | | | | | 14,686 | | | | | | (9,242) | | |
Accrued liabilities | | | | | (9,880) | | | | | | (10,668) | | |
Lease liabilities | | | | | (6,468) | | | | | | (2,383) | | |
Income tax payable | | | | | 5,508 | | | | | | 31,536 | | |
Deferred taxes | | | | | (2,857) | | | | | | (531) | | |
Deferred revenue | | | | | (913) | | | | | | (1,305) | | |
Other, net | | | | | (3) | | | | | | 14 | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 43,648 | | | | | | 56,845 | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (86,851) | | | | | | (61,785) | | |
Proceeds from disposal of assets | | | | | 1,841 | | | | | | 778 | | |
Distributions to minority members | | | | | — | | | | | | (100) | | |
Purchases of intangible assets | | | | | — | | | | | | (8,378) | | |
Acquisition of business, net of cash acquired | | | | | (94,042) | | | | | | (102,138) | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Proceeds from sale of deconsolidation and investment in associates | | | | | 19,576 | | | | | | — | | |
Purchase of interest in investment in associates | | | | | — | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | — | | | | | | 10,275 | | |
Proceeds from note receivable | | | | | — | | | | | | 4,215 | | |
Other, net | | | | | — | | | | | | 41 | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (159,476) | | | | | | (160,442) | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | | 120,774 | | | | | | 100,000 | | |
Principal repayments of notes payable | | | | | (8,245) | | | | | | (8,527) | | |
Debt issuance costs paid | | | | | (2,986) | | | | | | (5,132) | | |
Proceeds received from RTO Financing, net | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 109,543 | | | | | | 236,861 | | |
NET INCREASE (DECREASE) IN CASH | | | | | (6,285) | | | | | | 133,264 | | |
CASH, BEGINNING OF PERIOD | | | | | 99,118 | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 92,833 | | | | | $ | 149,666 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | |
Interest paid | | | | $ | 10,608 | | | | | $ | 1,761 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 3,296 | | | | | $ | 3,627 | | |
Issuance of shares under business combinations | | | | $ | 53,950 | | | | | $ | 896,795 | | |
Acquisitions | | | | | | | | | | | | | |
Tangible and intangible assets acquired, net of cash | | | | $ | 17,533 | | | | | $ | 1,127,009 | | |
Liabilities assumed | | | | | (4,362) | | | | | | (249,094) | | |
Acquisition consideration payable | | | | | 72,364 | | | | | | (1,038,668) | | |
Goodwill | | | | | 8,507 | | | | | | 262,891 | | |
| | | | $ | 94,042 | | | | | $ | 102,138 | | |
|
| | | Three Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | % Change | | |||||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 67,673 | | | | | $ | 59,312 | | | | | | 14.1% | | |
Retail | | | | $ | 185,308 | | | | | $ | 156,873 | | | | | | 18.1% | | |
Intersegment Eliminations | | | | $ | (29,319) | | | | | $ | (17,119) | | | | | | 71.3% | | |
Total Revenues, net of discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | | 12.4% | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
| | | | | | | | | (As Restated) | | |||
Raw Materials | | | | $ | 8,369 | | | | | $ | 5,767 | | |
Work in Process | | | | | 109,219 | | | | | | 96,367 | | |
Finished Goods | | | | | 36,462 | | | | | | 38,569 | | |
Total Inventories | | | | $ | 154,050 | | | | | $ | 140,703 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Land | | | | $ | 29,878 | | | | | $ | 29,399 | | |
Buildings and Improvements | | | | | 170,842 | | | | | | 126,020 | | |
Furniture and Fixtures | | | | | 15,900 | | | | | | 13,259 | | |
Computer Equipment and Software | | | | | 19,074 | | | | | | 14,078 | | |
Leasehold Improvements | | | | | 188,038 | | | | | | 182,514 | | |
Tools and Equipment | | | | | 79,768 | | | | | | 65,774 | | |
Vehicles | | | | | 4,716 | | | | | | 3,229 | | |
Assets Under Construction(1) | | | | | 73,311 | | | | | | 64,107 | | |
Total Property, Plant and Equipment | | | | | 581,527 | | | | | | 498,380 | | |
Less: Accumulated Depreciation | | | | | (65,829) | | | | | | (46,148) | | |
Property, Plant and Equipment, Net | | | | $ | 515,698 | | | | | $ | 452,232 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | $ | 1,386,131 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,451,900 | | |
Purchases | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Additions from business combination | | | | | 13,281 | | | | | | — | | | | | | — | | | | | | 13,281 | | |
Adjustments to purchase price allocation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Disposals | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Balance as of June 30, 2022 | | | | $ | 1,399,412 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,465,181 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Accumulated Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 66,703 | | | | | | 4,158 | | | | | | 1,126 | | | | | | 71,987 | | |
Amortization | | | | | 46,499 | | | | | | 2,710 | | | | | | 614 | | | | | | 49,823 | | |
Balance as of June 30, 2022 | | | | $ | 113,202 | | | | | $ | 6,868 | | | | | $ | 1,740 | | | | | $ | 121,810 | | |
Net Book Value | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 1,319,428 | | | | | | 50,008 | | | | | | 10,477 | | | | | | 1,379,913 | | |
Balance as of June 30, 2022 | | | | $ | 1,286,210 | | | | | $ | 47,298 | | | | | $ | 9,863 | | | | | $ | 1,343,371 | | |
|
Year Ending December 31: | | | Estimated Amortization | | |||
2022 (Remaining) | | | | $ | 49,975 | | |
2023 | | | | | 99,948 | | |
2024 | | | | | 99,948 | | |
2025 | | | | | 99,948 | | |
2026 | | | | | 99,221 | | |
Thereafter | | | | | 894,331 | | |
| | | | $ | 1,343,371 | | |
| | | January 1, 2022 | | | Impairment | | | Adjustments to purchase price allocation | | | Acquisitions | | | June 30, 2022 | | |||||||||||||||
Cultivation | | | | $ | 91,116 | | | | | $ | — | | | | | $ | 1,050 | | | | | $ | — | | | | | $ | 92,166 | | |
Retail | | | | | 277,014 | | | | | | — | | | | | | 912 | | | | | | 6,545 | | | | | | 284,471 | | |
Total | | | | $ | 368,130 | | | | | $ | — | | | | | $ | 1,962 | | | | | $ | 6,545 | | | | | $ | 376,637 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Numerator | | | | | | | | | | | | | | | | | | | | | | | | | |
Net Loss attributable to Verano Holdings Corp. | | | | $ | (9,847) | | | | | $ | (29,688) | | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Denominator | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | | | | | | | | | | | | | | | | | | | 158,203,932 | | |
Post-RTO weighted-average shares outstanding | | | | | | | | | | | 300,715,671 | | | | | | | | | | | | 297,365,427 | | |
Weighted-average shares outstanding – basic | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Diluted | | | | | | | | | | | | | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | | | | | | | | | | | | | | | | | | | 158,203,932 | | |
Post-RTO weighted-average shares outstanding | | | | | | | | | | | 300,715,671 | | | | | | | | | | | | 297,365,427 | | |
Weighted-average shares outstanding – diluted | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Basic earnings per share | | | | $ | (0.03) | | | | | $ | (0.10) | | | | | $ | (0.03) | | | | | $ | (0.14) | | |
Diluted earnings per share | | | | $ | (0.03) | | | | | $ | (0.10) | | | | | $ | (0.03) | | | | | $ | (0.14) | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
Cash | | | | $ | 5,446 | | | | | $ | 507 | | | | | $ | 5,953 | | |
Accounts receivable, net | | | | | 60 | | | | | | 498 | | | | | | 558 | | |
Inventory | | | | | 83,205 | | | | | | 5,827 | | | | | | 89,032 | | |
Prepaids and other current assets | | | | | 833 | | | | | | 1,989 | | | | | | 2,822 | | |
Property, plant and equipment, net | | | | | 73,386 | | | | | | 9,751 | | | | | | 83,137 | | |
Right-of-use asset, net | | | | | 9,651 | | | | | | — | | | | | | 9,651 | | |
Other assets | | | | | 1,001 | | | | | | — | | | | | | 1,001 | | |
Accounts payable and accrued liabilities | | | | | (8,935) | | | | | | (2,576) | | | | | | (11,511) | | |
Notes payable | | | | | (3,579) | | | | | | (3,343) | | | | | | (6,922) | | |
Deferred taxes | | | | | (123,720) | | | | | | (37,290) | | | | | | (161,010) | | |
Lease liabilities | | | | | (9,651) | | | | | | — | | | | | | (9,651) | | |
Total identifiable net assets (liabilities) | | | | | 27,697 | | | | | | (24,637) | | | | | | 3,060 | | |
Intangible assets | | | | | 498,938 | | | | | | 184,588 | | | | | | 683,526 | | |
Net assets | | | | $ | 526,635 | | | | | $ | 159,951 | | | | | $ | 686,586 | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
License | | | | $ | 319,928 | | | | | $ | 130,670 | | | | | $ | 450,598 | | |
Tradename | | | | | 36,278 | | | | | | 8,980 | | | | | | 45,258 | | |
Intellectual Property and Technology | | | | | 10,603 | | | | | | 885 | | | | | | 11,488 | | |
Total intangible assets | | | | | 366,809 | | | | | | 140,535 | | | | | | 507,344 | | |
Goodwill (residual purchase price) | | | | | 8,409 | | | | | | 6,763 | | | | | | 15,172 | | |
Goodwill (deferred taxes)(a) | | | | | 123,720 | | | | | | 37,290 | | | | | | 161,010 | | |
Total goodwill | | | | $ | 132,129 | | | | | $ | 44,053 | | | | | $ | 176,182 | | |
| | | Consolidated Results | | | AltMed Pre-acquisition | | | Pro-forma Results | | |||||||||
Revenues, net of discounts | | | | $ | 319,961 | | | | | $ | 22,402 | | | | | $ | 342,363 | | |
Net income (loss) | | | | | (37,574) | | | | | | 10,933 | | | | | | (26,641) | | |
| | | Six Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | % Change | | |||||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 120,681 | | | | | $ | 108,473 | | | | | | 11.3% | | |
Retail | | | | $ | 349,642 | | | | | $ | 236,068 | | | | | | 48.1% | | |
Intersegment Eliminations | | | | $ | (44,426) | | | | | $ | (24,580) | | | | | | 80.7% | | |
Total Revenues, net of discounts | | | | $ | 425,897 | | | | | $ | 319,961 | | | | | | 33.1% | | |
| | | Greengate | | |||
Cash and cash equivalents | | | | $ | 2,315 | | |
Inventory | | | | | 1,021 | | |
Prepaid & other current Assets | | | | | 324 | | |
Deposits and Other non-current assets | | | | | 45 | | |
Property, plant and equipment, net | | | | | 1,673 | | |
Right-of-use asset, Net | | | | | 1,836 | | |
Accounts payable and accrued liabilities | | | | | (1,569) | | |
Other liabilities | | | | | (72) | | |
Lease liabilities | | | | | (1,836) | | |
Total identifiable net assets (liabilities) | | | | | 3,737 | | |
Total Intangible assets | | | | | 19,826 | | |
| | | Six Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 186,106 | | | | | $ | 89,400 | | | | | $ | 44,455 | | | | | $ | 319,961 | | |
Net loss | | | | | (25,733) | | | | | | (9,570) | | | | | | (2,271) | | | | | | (37,574) | | |
| | | Three Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 99,294 | | | | | $ | 57,277 | | | | | $ | 42,495 | | | | | $ | 199,066 | | |
Net loss | | | | | (23,619) | | | | | | (4,180) | | | | | | (1,889) | | | | | | (29,688) | | |
| | | Six Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 186,106 | | | | | $ | 111,802 | | | | | $ | 133,091 | | | | | $ | 430,999 | | |
Pro forma net income (loss) | | | | | (25,733) | | | | | | 1,362 | | | | | | 19,785 | | | | | | (4,586) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) intangible amortization | | | | | — | | | | | | 14,899 | | | | | | 6,712 | | | | | | 21,611 | | |
(b) intangible amortization | | | | | — | | | | | | 45,797 | | | | | | 6,392 | | | | | | 52,189 | | |
Total pro forma adjustments | | | | | — | | | | | | 60,696 | | | | | | 13,104 | | | | | | 73,800 | | |
Total pro forma net income (loss) | | | | $ | (25,733) | | | | | $ | 62,058 | | | | | $ | 32,889 | | | | | $ | 69,214 | | |
| | | Three Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 99,294 | | | | | $ | 57,277 | | | | | $ | 60,001 | | | | | $ | 216,572 | | |
Pro forma net income (loss) | | | | | (23,619) | | | | | | (4,180) | | | | | | 2,477 | | | | | | (25,322) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) intangible amortization | | | | | — | | | | | | 8,939 | | | | | | 6,224 | | | | | | 15,163 | | |
(b) intangible amortization | | | | | — | | | | | | 27,952 | | | | | | 6,392 | | | | | | 34,344 | | |
Total pro forma adjustments | | | | | — | | | | | | 36,891 | | | | | | 12,616 | | | | | | 49,507 | | |
Total pro forma net income (loss) | | | | $ | (23,619) | | | | | $ | 32,711 | | | | | $ | 15,093 | | | | | $ | 24,185 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Credit Facility | | | | $ | 350,000 | | | | | $ | 250,000 | | |
Secured Promissory Notes | | | | | 1,668 | | | | | | 6,663 | | |
Mortgage Loans | | | | | 56,122 | | | | | | 38,856 | | |
Vehicle and Equipment Loans | | | | | 2,209 | | | | | | 1,951 | | |
Unamortized Debt Issuance Costs | | | | | (7,370) | | | | | | (7,545) | | |
Total Notes Payable | | | | $ | 402,629 | | | | | $ | 289,925 | | |
Less: Current Portion of Notes Payable | | | | | 258,880 | | | | | | 13,771 | | |
Total Long-Term Debt, net | | | | $ | 143,749 | | | | | $ | 276,154 | | |
| | | Number of Shares | | | Weighted Avg. Exercise Price C$ | | | Weighted Average Remaining Contractual Life | | |||||||||
Balance as of December 31, 2021 | | | | | 56,078 | | | | | | 30.60 | | | | | | 9.16 | | |
Vested | | | | | 18,798 | | | | | | 30.60 | | | | | ||||
Exercisable at June 30, 2022 | | | | | 24,167 | | | | | | 30.60 | | | | | | 8.67 | | |
| | | Number of Shares | | | Weighted Avg. Grant Date Fair Value C$ | | ||||||
Unvested Shares at December 31, 2021 | | | | | 2,413,887 | | | | | | 30.49 | | |
Granted | | | | | 2,748,440 | | | | | | 10.57 | | |
Forfeited | | | | | 975 | | | | | | 23.97 | | |
Vested | | | | | 1,189,055 | | | | | | 30.65 | | |
Unvested Shares at June 30, 2022 | | | | | 3,972,297 | | | | | | 16.66 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Weighted average grant date fair value (per share) of RSUs granted (C$) | | | | | 16.66 | | | | | | 30.60 | | |
Intrinsic value of RSUs vested, using market price at vest date (C$) (in thousands) | | | | | 15.41 | | | | | | — | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Stock Options Expense | | | | $ | 62 | | | | | $ | 115 | | | | | $ | 125 | | | | | $ | 168 | | |
Restricted Stock Units | | | | | 13,430 | | | | | | 12,465 | | | | | | 24,280 | | | | | | 18,165 | | |
Total Stock Based Compensation Expense | | | | $ | 13,492 | | | | | $ | 12,580 | | | | | $ | 24,405 | | | | | $ | 18,333 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Income before Income Taxes | | | | $ | 1,256 | | | | | $ | (6,152) | | | | | $ | 26,847 | | | | | $ | 3,642 | | |
Income Tax Expense | | | | | (11,103) | | | | | | (23,438) | | | | | | (36,617) | | | | | | (39,852) | | |
Effective Tax Rate | | | | | 662.9% | | | | | | 381.0% | | | | | | 112.3% | | | | | | 1093.8% | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Weighted average remaining lease term (years) | | | | | 8.26 | | | | | | 8.52 | | |
Weighted average discount rate | | | | | 8.03% | | | | | | 8.11% | | |
Year Ending December 31, | | | | | | | | | | | | | |
Remainder 2022 | | | | $ | 6,851 | | | | | $ | 11,457 | | |
2023 | | | | | 13,244 | | | | | | 11,024 | | |
2024 | | | | | 12,519 | | | | | | 10,348 | | |
2025 | | | | | 11,590 | | | | | | 9,717 | | |
2026 | | | | | 10,722 | | | | | | 8,818 | | |
2027 and Thereafter | | | | | 47,894 | | | | | | 38,177 | | |
Total Lease Payments | | | | | 102,820 | | | | | | 89,541 | | |
Less: Interest | | | | | (28,737) | | | | | | (26,166) | | |
Present Value of Lease Liability | | | | $ | 74,083 | | | | | $ | 63,375 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Revenue, net of discounts | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 67,673 | | | | | $ | 59,312 | | | | | $ | 120,681 | | | | | $ | 108,473 | | |
Retail | | | | | 185,308 | | | | | | 156,873 | | | | | | 349,642 | | | | | | 236,068 | | |
Intersegment Eliminations | | | | | (29,319) | | | | | | (17,119) | | | | | | (44,426) | | | | | | (24,580) | | |
Total Revenue, net of discounts | | | | | 223,662 | | | | | | 199,066 | | | | | | 425,897 | | | | | | 319,961 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Depreciation and Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 19,089 | | | | | | 13,963 | | | | | | 38,814 | | | | | | 22,282 | | |
Retail | | | | | 16,388 | | | | | | 10,311 | | | | | | 31,097 | | | | | | 13,775 | | |
Total Depreciation and Amortization | | | | | 35,477 | | | | | | 24,274 | | | | | | 69,911 | | | | | | 36,057 | | |
Income taxes | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 1,265 | | | | | | 8,080 | | | | | | 12,502 | | | | | | 11,776 | | |
Retail | | | | | 9,838 | | | | | | 15,358 | | | | | | 24,115 | | | | | | 28,076 | | |
Total Income Taxes | | | | | 11,103 | | | | | | 23,438 | | | | | | 36,617 | | | | | | 39,852 | | |
|
| | | Consolidated VIE | | | Consolidated VOE | | | Consolidated VIE | | | Consolidated VOE | | ||||||||||||
| | | June 30, 2022 | | | December 31, 2021 | | ||||||||||||||||||
| | | | | | | | | | | | | | | (As Restated) | | |||||||||
Current Assets | | | | $ | 43,362 | | | | | $ | — | | | | | $ | 43,045 | | | | | $ | 20,464 | | |
Due To/(From) | | | | | (68,307) | | | | | | — | | | | | | (25,723) | | | | | | 14,228 | | |
Non-Current Assets | | | | | 96,342 | | | | | | — | | | | | | 207,908 | | | | | | 226,108 | | |
Current Liabilities | | | | | 14,359 | | | | | | — | | | | | | 32,934 | | | | | | 22,659 | | |
Non-Current Liabilities | | | | | 11,134 | | | | | | — | | | | | | 45,873 | | | | | | 45,603 | | |
Non-Controlling Interest | | | | | — | | | | | | — | | | | | | 1,276 | | | | | | — | | |
Equity attributable to Verano Holdings, Corp. | | | | | 45,904 | | | | | | — | | | | | | 145,147 | | | | | | 192,538 | | |
| | | As of June 30, 2022 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 92,833 | | | | | $ | — | | | | | $ | — | | | | | $ | 92,833 | | |
Investments | | | | | 3,842 | | | | | | — | | | | | | — | | | | | | 3,842 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (66,901) | | | | | | (66,901) | | |
Total | | | | $ | 96,675 | | | | | $ | — | | | | | $ | (66,901) | | | | | $ | 29,774 | | |
| | | As of December 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 99,118 | | | | | $ | — | | | | | $ | — | | | | | $ | 99,118 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (208,349) | | | | | | (208,349) | | |
Total | | | | $ | 99,118 | | | | | $ | — | | | | | $ | (208,349) | | | | | $ | (109,231) | | |
| | | For the Three Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Revenue, net of discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | $ | 24,596 | | |
Gross Profit | | | | | 98,115 | | | | | | 69,210 | | | | | | 28,905 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (9,847) | | | | | | (29,688) | | | | | | 19,841 | | |
Net Loss per share – basic & diluted | | | | | (0.03) | | | | | | (0.10) | | | | | | 0.07 | | |
| | | Three Months Ended June 30, | | | 2022 — 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Cost of Goods Sold, net | | | | $ | 125,547 | | | | | $ | 129,856 | | | | | $ | (4,309) | | |
Selling, General, and Administrative Expenses | | | | | 100,263 | | | | | | 70,013 | | | | | | 30,250 | | |
Other Income (Expense) | | | | | 3,548 | | | | | | (5,994) | | | | | | 9,542 | | |
Provision for Income Taxes | | | | | (11,103) | | | | | | (23,438) | | | | | | 12,335 | | |
| | | For the Six Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Revenue, net of discounts | | | | $ | 425,897 | | | | | $ | 319,961 | | | | | $ | 105,936 | | |
Gross Profit | | | | | 196,732 | | | | | | 123,500 | | | | | | 73,232 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (10,061) | | | | | | (37,574) | | | | | | 27,513 | | |
Net Loss per share – basic & diluted | | | | | (0.03) | | | | | | (0.14) | | | | | | 0.11 | | |
| | | Six Months Ended June 30, | | | 2022 — 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Cost of goods sold, net | | | | $ | 229,165 | | | | | $ | 196,461 | | | | | $ | 32,704 | | |
Selling, General, and Administrative Expense | | | | | 189,824 | | | | | | 112,679 | | | | | | 77,145 | | |
Other Income (Expense) | | | | | 18,079 | | | | | | (8,627) | | | | | | 26,706 | | |
Provision for Income Taxes | | | | | (36,617) | | | | | | (39,852) | | | | | | 3,235 | | |
| | | Three Months Ended March 31, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
| | | (As Restated) | | | (As Restated) | | ||||||
Net Cash Provided by Operating Activities | | | | $ | 34,457 | | | | | $ | 24,930 | | |
Net Cash Used in Investing Activities | | | | | (86,743) | | | | | | (72,068) | | |
Net Cash Provided by Financing Activities | | | | | 92,805 | | | | | | 143,004 | | |
| | | Years ended December 31, | | |||||||||||||||
| | | 2021 | | | 2020 | | | 2019 | | |||||||||
| | | (As Restated) | | | | | | | | | | | | | | |||
Net Cash Provided by (Used in) Operating Activities | | | | $ | 182,872 | | | | | $ | 71,627 | | | | | $ | (6,660) | | |
Net Cash (Used in) Investing Activities | | | | | (455,832) | | | | | | (86,908) | | | | | | (84,118) | | |
Net Cash Provided by Financing Activities | | | | | 355,676 | | | | | | 25,266 | | | | | | 24,108 | | |
| | | Payments Due by Period | | |||||||||||||||||||||||||||
Contractual Obligations | | | Total | | | Less than 1 year | | | 1-2 years | | | 3-4 years | | | 5 years and after | | |||||||||||||||
Long Term Debt(1) | | | | $ | 289,924 | | | | | $ | 13,771 | | | | | $ | 265,867 | | | | | $ | 2,108 | | | | | $ | 8,178 | | |
Operating Leases | | | | $ | 89,541 | | | | | $ | 11,457 | | | | | $ | 21,372 | | | | | $ | 18,534 | | | | | $ | 38,178 | | |
Purchase Obligations(2) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Other Long Term Obligations(3) | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Total Contractual Obligations | | | | $ | 379,465 | | | | | $ | 25,228 | | | | | $ | 287,239 | | | | | $ | 20,642 | | | | | $ | 46,356 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
| | | (Unaudited) | | | (As Restated) | | ||||||
ASSETS | | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | | |
Cash and Cash Equivalents | | | | $ | 92,833 | | | | | $ | 99,118 | | |
Accounts Receivable, net | | | | | 13,253 | | | | | | 17,410 | | |
Notes Receivable | | | | | — | | | | | | 285 | | |
Inventory | | | | | 154,050 | | | | | | 140,703 | | |
Prepaid Expenses and Other Current Assets | | | | | 27,820 | | | | | | 19,528 | | |
Total Current Assets | | | | | 287,956 | | | | | | 277,044 | | |
Property, Plant and Equipment, net | | | | | 515,698 | | | | | | 452,232 | | |
Right of Use Assets, net | | | | | 71,472 | | | | | | 61,346 | | |
Intangible Assets, net | | | | | 1,343,371 | | | | | | 1,379,913 | | |
Goodwill | | | | | 376,637 | | | | | | 368,130 | | |
Investment in Associates | | | | | 7,252 | | | | | | 7,491 | | |
Deposits and Other Assets | | | | | 2,584 | | | | | | 2,499 | | |
TOTAL ASSETS | | | | $ | 2,604,970 | | | | | $ | 2,548,655 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
LIABILITIES | | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | | |
Accounts Payable | | | | $ | 60,832 | | | | | $ | 45,172 | | |
Accrued Liabilities | | | | | 30,773 | | | | | | 42,149 | | |
Income Tax Payable | | | | | 161,430 | | | | | | 154,512 | | |
Current Portion of Lease Liabilities | | | | | 7,961 | | | | | | 6,563 | | |
Current Portion of Notes Payable | | | | | 258,880 | | | | | | 13,771 | | |
Acquisition Consideration Payable | | | | | 66,901 | | | | | | 208,349 | | |
Total Current Liabilities | | | | | 586,777 | | | | | | 470,516 | | |
Long-Term Liabilities: | | | | | | | | | | | | | |
Deferred Revenue | | | | | 271 | | | | | | 1,183 | | |
Notes Payable, net of Current Portion | | | | | 143,749 | | | | | | 276,154 | | |
Lease Liabilities, net of Current Portion | | | | | 66,122 | | | | | | 56,812 | | |
Deferred Income Taxes | | | | | 259,326 | | | | | | 262,184 | | |
Total Long-Term Liabilities | | | | | 469,468 | | | | | | 596,333 | | |
TOTAL LIABILITIES | | | | $ | 1,056,245 | | | | | $ | 1,066,849 | | |
SHAREHOLDERS’ EQUITY | | | | | 1,548,725 | | | | | | 1,480,530 | | |
NON-CONTROLLING INTEREST | | | | | — | | | | | | 1,276 | | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | $ | 2,604,970 | | | | | $ | 2,548,655 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Revenues, net of Discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | $ | 425,897 | | | | | $ | 319,961 | | |
Cost of Goods Sold, net | | | | | 125,547 | | | | | | 129,856 | | | | | | 229,165 | | | | | | 196,461 | | |
Gross Profit | | | | | 98,115 | | | | | | 69,210 | | | | | | 196,732 | | | | | | 123,500 | | |
Selling, General, and Administrative Expenses | | | | | 100,263 | | | | | | 70,013 | | | | | | 189,824 | | | | | | 112,679 | | |
Income (Loss) from Investments in Associates | | | | | (144) | | | | | | 645 | | | | | | 1,860 | | | | | | 1,448 | | |
Income (Loss) from Operations | | | | | (2,292) | | | | | | (158) | | | | | | 8,768 | | | | | | 12,269 | | |
Other Income (Expense): | | | | | | | | | | | | | | | | | | | | | | | | | |
Loss on Disposal of Property, Plant and Equipment | | | | | (203) | | | | | | (429) | | | | | | (1,192) | | | | | | (429) | | |
Gain (Loss) on Deconsolidation | | | | | (73) | | | | | | — | | | | | | 9,485 | | | | | | — | | |
Gain (Loss) on Previously Held Equity Interest | | | | | (171) | | | | | | — | | | | | | 13,928 | | | | | | — | | |
Interest Expense, net | | | | | (11,624) | | | | | | (5,434) | | | | | | (22,295) | | | | | | (7,201) | | |
Other Income (Expense), net | | | | | 15,619 | | | | | | (131) | | | | | | 18,153 | | | | | | (997) | | |
Total Other Income (Expense) | | | | | 3,548 | | | | | | (5,994) | | | | | | 18,079 | | | | | | (8,627) | | |
Net Income (Loss) Before Provision for Income Taxes and Non-Controlling Interest | | | | | 1,256 | | | | | | (6,152) | | | | | | 26,847 | | | | | | 3,642 | | |
Provision For Income Taxes | | | | | (11,103) | | | | | | (23,438) | | | | | | (36,617) | | | | | | (39,852) | | |
Net Loss Before Non-Controlling Interest | | | | | (9,847) | | | | | | (29,590) | | | | | | (9,770) | | | | | | (36,210) | | |
Net Income Attributable to Non-Controlling Interest | | | | | — | | | | | | 98 | | | | | | 291 | | | | | | 1,364 | | |
Net Loss Attributable to Verano Holdings Corp. | | | | $ | (9,847) | | | | | $ | (29,688) | | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Net Loss per share – basic | | | | | (0.03) | | | | | | (0.10) | | | | | | (0.03) | | | | | | (0.14) | | |
Net Loss per share – diluted | | | | | (0.03) | | | | | | (0.10) | | | | | | (0.03) | | | | | | (0.14) | | |
Basic – weighted average shares outstanding | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Diluted – weighted average shares outstanding | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of April 1, 2021 (As Restated) | | | | | — | | | | | | 293,199,219 | | | | | $ | 1,030,163 | | | | | $ | 1,361 | | | | | $ | 7,403 | | | | | $ | 1,038,927 | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 14,483 | | | | | | — | | | | | | — | | | | | | 14,483 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 10,410,187 | | | | | | 207,136 | | | | | | — | | | | | | — | | | | | | 207,136 | | |
Issuance of warrants | | | | | — | | | | | | 3,510,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 103,775 | | | | | | 2,085 | | | | | | — | | | | | | — | | | | | | 2,085 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (29,688) | | | | | | 98 | | | | | | (29,590) | | |
Balance as of June 30, 2021 | | | | | — | | | | | | 307,223,181 | | | | | $ | 1,253,867 | | | | | $ | (28,327) | | | | | $ | 7,501 | | | | | $ | 1,233,041 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of April 1, 2022 (As Restated) | | | | | — | | | | | | 327,868,398 | | | | | $ | 1,578,232 | | | | | $ | (55,449) | | | | | $ | — | | | | | $ | 1,522,783 | | |
Share-based compensation | | | | | — | | | | | | 26,570 | | | | | | 12,523 | | | | | | — | | | | | | — | | | | | | 12,523 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 808,258 | | | | | | 5,540 | | | | | | — | | | | | | — | | | | | | 5,540 | | |
Noncontrolling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 2,115,438 | | | | | | 17,726 | | | | | | — | | | | | | — | | | | | | 17,726 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (9,847) | | | | | | — | | | | | | (9,847) | | |
Balance as of June 30, 2022 | | | | | — | | | | | | 330,818,664 | | | | | $ | 1,614,021 | | | | | $ | (65,296) | | | | | $ | — | | | | | $ | 1,548,725 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2021 | | | | | 279,900,000 | | | | | | — | | | | | $ | 137,914 | | | | | $ | 9,247 | | | | | $ | 6,237 | | | | | $ | 153,398 | | |
RTO-related issuances, net | | | | | — | | | | | | — | | | | | | 652,217 | | | | | | — | | | | | | — | | | | | | 652,217 | | |
Issuance of Pubco shares in redemption of membership units | | | | | (279,900,000) | | | | | | 279,900,000 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Reverse takeover (“RTO Financing”), net | | | | | — | | | | | | 10,100,000 | | | | | | 95,420 | | | | | | — | | | | | | — | | | | | | 95,420 | | |
Distributions to minority members | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (100) | | | | | | (100) | | |
Share-based compensation | | | | | — | | | | | | — | | | | | | 21,097 | | | | | | — | | | | | | — | | | | | | 21,097 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 13,609,406 | | | | | | 270,034 | | | | | | — | | | | | | — | | | | | | 270,034 | | |
Warrants issued and exercised | | | | | — | | | | | | 3,510,000 | | | | | | 75,100 | | | | | | — | | | | | | — | | | | | | 75,100 | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 103,775 | | | | | | 2,085 | | | | | | — | | | | | | — | | | | | | 2,085 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (37,574) | | | | | | 1,364 | | | | | | (36,210) | | |
Balance as of June 30, 2021 | | | | | — | | | | | | 307,223,181 | | | | | $ | 1,253,867 | | | | | $ | (28,327) | | | | | $ | 7,501 | | | | | $ | 1,233,041 | | |
| | | LLC Membership Units | | | SVS Shares (as converted) | | | Share Capital | | | Accumulated Earnings (Deficit) | | | Non-Controlling Interest | | | Total | | ||||||||||||||||||
Balance as of January 1, 2022 (As Restated) | | | | | — | | | | | | 324,312,662 | | | | | $ | 1,535,765 | | | | | $ | (55,235) | | | | | $ | 1,276 | | | | | $ | 1,481,806 | | |
Share-based compensation | | | | | — | | | | | | 797,907 | | | | | | 24,265 | | | | | | — | | | | | | — | | | | | | 24,265 | | |
Issuance of shares in conjunction with acquisitions | | | | | — | | | | | | 2,211,325 | | | | | | 18,760 | | | | | | — | | | | | | — | | | | | | 18,760 | | |
Non-controlling interest adjustment for change in ownership | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (1,567) | | | | | | (1,567) | | |
Contingent consideration & other adjustments to purchase accounting | | | | | — | | | | | | 3,496,770 | | | | | | 35,231 | | | | | | — | | | | | | — | | | | | | 35,231 | | |
Net income (loss) | | | | | — | | | | | | — | | | | | | — | | | | | | (10,061) | | | | | | 291 | | | | | | (9,770) | | |
Balance as of June 30, 2022 | | | | | — | | | | | | 330,818,664 | | | | | $ | 1,614,021 | | | | | $ | (65,296) | | | | | $ | — | | | | | $ | 1,548,725 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
CASH FLOW FROM OPERATING ACTIVITIES | | | | | | | | | | | | | |
Net loss attributable to Verano Holdings Corp. and Subsidiaries | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Net income attributable to non-controlling interest | | | | | 291 | | | | | | 1,364 | | |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | | | | | | | | | | | | | |
Depreciation and amortization | | | | | 69,911 | | | | | | 36,057 | | |
Non-cash interest expense | | | | | 1,016 | | | | | | 2,907 | | |
Non-cash interest income | | | | | — | | | | | | (17) | | |
Non-cash inventory step-up expense on acquisitions | | | | | 6,707 | | | | | | 52,189 | | |
Loss on disposal of property, plant and equipment | | | | | 1,192 | | | | | | 429 | | |
Gain on deconsolidation | | | | | (9,485) | | | | | | — | | |
Gain on disposal of investments in associates | | | | | (13,928) | | | | | | — | | |
Bad debt expense | | | | | — | | | | | | 68 | | |
Amortization of debt issuance costs | | | | | 3,160 | | | | | | 517 | | |
Unrealized gain on marketable securities | | | | | 2,148 | | | | | | — | | |
Loss (income) from underlying investees | | | | | (310) | | | | | | (7,319) | | |
Stock earnout from acquisitions | | | | | — | | | | | | 2,084 | | |
Loss (income) on share issuance | | | | | (4,650) | | | | | | 1,236 | | |
Decrease in fair value of contingent consideration | | | | | (9,102) | | | | | | — | | |
Stock based compensation | | | | | 24,405 | | | | | | 18,333 | | |
Changes in operating assets and liabilities: | | | | | | | | | | | | | |
Accounts receivable | | | | | 4,157 | | | | | | (900) | | |
Inventory | | | | | (19,927) | | | | | | (23,023) | | |
Prepaid expenses and other current assets | | | | | (6,333) | | | | | | 138 | | |
Deposits and other assets | | | | | 4,384 | | | | | | 2,935 | | |
Accounts payable | | | | | 14,686 | | | | | | (9,242) | | |
Accrued liabilities | | | | | (9,880) | | | | | | (10,668) | | |
Lease liabilities | | | | | (6,468) | | | | | | (2,383) | | |
Income tax payable | | | | | 5,508 | | | | | | 31,536 | | |
Deferred taxes | | | | | (2,857) | | | | | | (531) | | |
Deferred revenue | | | | | (913) | | | | | | (1,305) | | |
Other, net | | | | | (3) | | | | | | 14 | | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | | | | | 43,648 | | | | | | 56,845 | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | | | | | | | | | | | |
Purchases of property, plant and equipment | | | | | (86,851) | | | | | | (61,785) | | |
Proceeds from disposal of assets | | | | | 1,841 | | | | | | 778 | | |
Distributions to minority members | | | | | — | | | | | | (100) | | |
Purchases of intangible assets | | | | | — | | | | | | (8,378) | | |
Acquisition of business, net of cash acquired | | | | | (94,042) | | | | | | (102,138) | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Proceeds from sale of deconsolidation and investment in associates | | | | | 19,576 | | | | | | — | | |
Purchase of interest in investment in associates | | | | | — | | | | | | (3,350) | | |
Dividend received from investments in associates | | | | | — | | | | | | 10,275 | | |
Proceeds from note receivable | | | | | — | | | | | | 4,215 | | |
Other, net | | | | | — | | | | | | 41 | | |
NET CASH USED IN INVESTING ACTIVITIES | | | | | (159,476) | | | | | | (160,442) | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | | | | | | | | | | | |
Proceeds from issuance of notes payable | | | | | 120,774 | | | | | | 100,000 | | |
Principal repayments of notes payable | | | | | (8,245) | | | | | | (8,527) | | |
Debt issuance costs paid | | | | | (2,986) | | | | | | (5,132) | | |
Proceeds received from RTO Financing, net | | | | | — | | | | | | 75,420 | | |
Cash received in warrant private placement | | | | | — | | | | | | 75,100 | | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | | | | | 109,543 | | | | | | 236,861 | | |
NET INCREASE (DECREASE) IN CASH | | | | | (6,285) | | | | | | 133,264 | | |
CASH, BEGINNING OF PERIOD | | | | | 99,118 | | | | | | 16,402 | | |
CASH, END OF PERIOD | | | | $ | 92,833 | | | | | $ | 149,666 | | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | | | | | | | | | | | | | |
Interest paid | | | | $ | 10,608 | | | | | $ | 1,761 | | |
NONCASH INVESTING AND FINANCING ACTIVITIES | | | | | | | | | | | | | |
Accrued capital expenditures | | | | $ | 3,296 | | | | | $ | 3,627 | | |
Issuance of shares under business combinations | | | | $ | 53,950 | | | | | $ | 896,795 | | |
Acquisitions | | | | | | | | | | | | | |
Tangible and intangible assets acquired, net of cash | | | | $ | 17,533 | | | | | $ | 1,127,009 | | |
Liabilities assumed | | | | | (4,362) | | | | | | (249,094) | | |
Acquisition consideration payable | | | | | 72,364 | | | | | | (1,038,668) | | |
Goodwill | | | | | 8,507 | | | | | | 262,891 | | |
| | | | $ | 94,042 | | | | | $ | 102,138 | | |
|
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
| | | | | | | | | (As Restated) | | |||
Raw Materials | | | | $ | 8,369 | | | | | $ | 5,767 | | |
Work in Process | | | | | 109,219 | | | | | | 96,367 | | |
Finished Goods | | | | | 36,462 | | | | | | 38,569 | | |
Total Inventories | | | | $ | 154,050 | | | | | $ | 140,703 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Land | | | | $ | 29,878 | | | | | $ | 29,399 | | |
Buildings and Improvements | | | | | 170,842 | | | | | | 126,020 | | |
Furniture and Fixtures | | | | | 15,900 | | | | | | 13,259 | | |
Computer Equipment and Software | | | | | 19,074 | | | | | | 14,078 | | |
Leasehold Improvements | | | | | 188,038 | | | | | | 182,514 | | |
Tools and Equipment | | | | | 79,768 | | | | | | 65,774 | | |
Vehicles | | | | | 4,716 | | | | | | 3,229 | | |
Assets Under Construction(1) | | | | | 73,311 | | | | | | 64,107 | | |
Total Property, Plant and Equipment | | | | | 581,527 | | | | | | 498,380 | | |
Less: Accumulated Depreciation | | | | | (65,829) | | | | | | (46,148) | | |
Property, Plant and Equipment, Net | | | | $ | 515,698 | | | | | $ | 452,232 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Cost | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | $ | 1,386,131 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,451,900 | | |
Purchases | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Additions from business combination | | | | | 13,281 | | | | | | — | | | | | | — | | | | | | 13,281 | | |
Adjustments to purchase price allocation | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Disposals | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Balance as of June 30, 2022 | | | | $ | 1,399,412 | | | | | $ | 54,166 | | | | | $ | 11,603 | | | | | $ | 1,465,181 | | |
| | | Licenses | | | Tradenames | | | Technology | | | Total | | ||||||||||||
Accumulated Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 66,703 | | | | | | 4,158 | | | | | | 1,126 | | | | | | 71,987 | | |
Amortization | | | | | 46,499 | | | | | | 2,710 | | | | | | 614 | | | | | | 49,823 | | |
Balance as of June 30, 2022 | | | | $ | 113,202 | | | | | $ | 6,868 | | | | | $ | 1,740 | | | | | $ | 121,810 | | |
Net Book Value | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of January 1, 2022 | | | | | 1,319,428 | | | | | | 50,008 | | | | | | 10,477 | | | | | | 1,379,913 | | |
Balance as of June 30, 2022 | | | | $ | 1,286,210 | | | | | $ | 47,298 | | | | | $ | 9,863 | | | | | $ | 1,343,371 | | |
|
Year Ending December 31: | | | Estimated Amortization | | |||
2022 (Remaining) | | | | $ | 49,975 | | |
2023 | | | | | 99,948 | | |
2024 | | | | | 99,948 | | |
2025 | | | | | 99,948 | | |
2026 | | | | | 99,221 | | |
Thereafter | | | | | 894,331 | | |
| | | | $ | 1,343,371 | | |
| | | January 1, 2022 | | | Impairment | | | Adjustments to purchase price allocation | | | Acquisitions | | | June 30, 2022 | | |||||||||||||||
Cultivation | | | | $ | 91,116 | | | | | $ | — | | | | | $ | 1,050 | | | | | $ | — | | | | | $ | 92,166 | | |
Retail | | | | | 277,014 | | | | | | — | | | | | | 912 | | | | | | 6,545 | | | | | | 284,471 | | |
Total | | | | $ | 368,130 | | | | | $ | — | | | | | $ | 1,962 | | | | | $ | 6,545 | | | | | $ | 376,637 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Numerator | | | | | | | | | | | | | | | | | | | | | | | | | |
Net Loss attributable to Verano Holdings Corp. | | | | $ | (9,847) | | | | | $ | (29,688) | | | | | $ | (10,061) | | | | | $ | (37,574) | | |
Denominator | | | | | | | | | | | | | | | | | | | | | | | | | |
Basic | | | | | | | | | | | | | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | | | | | | | | | | | | | | | | | | | 158,203,932 | | |
Post-RTO weighted-average shares outstanding | | | | | | | | | | | 300,715,671 | | | | | | | | | | | | 297,365,427 | | |
Weighted-average shares outstanding – basic | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Diluted | | | | | | | | | | | | | | | | | | | | | | | | | |
Pre-RTO weighted-average shares outstanding | | | | | | | | | | | | | | | | | | | | | | | 158,203,932 | | |
Post-RTO weighted-average shares outstanding | | | | | | | | | | | 300,715,671 | | | | | | | | | | | | 297,365,427 | | |
Weighted-average shares outstanding – diluted | | | | | 328,519,193 | | | | | | 300,715,671 | | | | | | 327,402,503 | | | | | | 265,842,657 | | |
Basic earnings per share | | | | $ | (0.03) | | | | | $ | (0.10) | | | | | $ | (0.03) | | | | | $ | (0.14) | | |
Diluted earnings per share | | | | $ | (0.03) | | | | | $ | (0.10) | | | | | $ | (0.03) | | | | | $ | (0.14) | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
Cash | | | | $ | 5,446 | | | | | $ | 507 | | | | | $ | 5,953 | | |
Accounts receivable, net | | | | | 60 | | | | | | 498 | | | | | | 558 | | |
Inventory | | | | | 83,205 | | | | | | 5,827 | | | | | | 89,032 | | |
Prepaids and other current assets | | | | | 833 | | | | | | 1,989 | | | | | | 2,822 | | |
Property, plant and equipment, net | | | | | 73,386 | | | | | | 9,751 | | | | | | 83,137 | | |
Right-of-use asset, net | | | | | 9,651 | | | | | | — | | | | | | 9,651 | | |
Other assets | | | | | 1,001 | | | | | | — | | | | | | 1,001 | | |
Accounts payable and accrued liabilities | | | | | (8,935) | | | | | | (2,576) | | | | | | (11,511) | | |
Notes payable | | | | | (3,579) | | | | | | (3,343) | | | | | | (6,922) | | |
Deferred taxes | | | | | (123,720) | | | | | | (37,290) | | | | | | (161,010) | | |
Lease liabilities | | | | | (9,651) | | | | | | — | | | | | | (9,651) | | |
Total identifiable net assets (liabilities) | | | | | 27,697 | | | | | | (24,637) | | | | | | 3,060 | | |
Intangible assets | | | | | 498,938 | | | | | | 184,588 | | | | | | 683,526 | | |
Net assets | | | | $ | 526,635 | | | | | $ | 159,951 | | | | | $ | 686,586 | | |
| | | AltMed Florida | | | AltMed Arizona | | | Total | | |||||||||
License | | | | $ | 319,928 | | | | | $ | 130,670 | | | | | $ | 450,598 | | |
Tradename | | | | | 36,278 | | | | | | 8,980 | | | | | | 45,258 | | |
Intellectual Property and Technology | | | | | 10,603 | | | | | | 885 | | | | | | 11,488 | | |
Total intangible assets | | | | | 366,809 | | | | | | 140,535 | | | | | | 507,344 | | |
Goodwill (residual purchase price) | | | | | 8,409 | | | | | | 6,763 | | | | | | 15,172 | | |
Goodwill (deferred taxes)(a) | | | | | 123,720 | | | | | | 37,290 | | | | | | 161,010 | | |
Total goodwill | | | | $ | 132,129 | | | | | $ | 44,053 | | | | | $ | 176,182 | | |
| | | Consolidated Results | | | AltMed Pre-acquisition | | | Pro-forma Results | | |||||||||
Revenues, net of discounts | | | | $ | 319,961 | | | | | $ | 22,402 | | | | | $ | 342,363 | | |
Net income (loss) | | | | | (37,574) | | | | | | 10,933 | | | | | | (26,641) | | |
| | | Greengate | | |||
Cash and cash equivalents | | | | $ | 2,315 | | |
Inventory | | | | | 1,021 | | |
Prepaid & other current Assets | | | | | 324 | | |
Deposits and Other non-current assets | | | | | 45 | | |
Property, plant and equipment, net | | | | | 1,673 | | |
Right-of-use asset, Net | | | | | 1,836 | | |
Accounts payable and accrued liabilities | | | | | (1,569) | | |
Other liabilities | | | | | (72) | | |
Lease liabilities | | | | | (1,836) | | |
Total identifiable net assets (liabilities) | | | | | 3,737 | | |
Total Intangible assets | | | | | 19,826 | | |
| | | Six Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 186,106 | | | | | $ | 89,400 | | | | | $ | 44,455 | | | | | $ | 319,961 | | |
Net loss | | | | | (25,733) | | | | | | (9,570) | | | | | | (2,271) | | | | | | (37,574) | | |
| | | Three Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Revenues, net | | | | $ | 99,294 | | | | | $ | 57,277 | | | | | $ | 42,495 | | | | | $ | 199,066 | | |
Net loss | | | | | (23,619) | | | | | | (4,180) | | | | | | (1,889) | | | | | | (29,688) | | |
| | | Six Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 186,106 | | | | | $ | 111,802 | | | | | $ | 133,091 | | | | | $ | 430,999 | | |
Pro forma net income (loss) | | | | | (25,733) | | | | | | 1,362 | | | | | | 19,785 | | | | | | (4,586) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) intangible amortization | | | | | — | | | | | | 14,899 | | | | | | 6,712 | | | | | | 21,611 | | |
(b) intangible amortization | | | | | — | | | | | | 45,797 | | | | | | 6,392 | | | | | | 52,189 | | |
Total pro forma adjustments | | | | | — | | | | | | 60,696 | | | | | | 13,104 | | | | | | 73,800 | | |
Total pro forma net income (loss) | | | | $ | (25,733) | | | | | $ | 62,058 | | | | | $ | 32,889 | | | | | $ | 69,214 | | |
| | | Three Months Ended June 30, 2021 | | |||||||||||||||||||||
| | | Verano Holdings | | | AME Merger | | | Other Acquisitions | | | Total | | ||||||||||||
Pro forma revenues, net | | | | $ | 99,294 | | | | | $ | 57,277 | | | | | $ | 60,001 | | | | | $ | 216,572 | | |
Pro forma net income (loss) | | | | | (23,619) | | | | | | (4,180) | | | | | | 2,477 | | | | | | (25,322) | | |
Pro forma adjustments | | | | | | | | | | | | | | | | | | | | | | | | | |
(a) intangible amortization | | | | | — | | | | | | 8,939 | | | | | | 6,224 | | | | | | 15,163 | | |
(b) intangible amortization | | | | | — | | | | | | 27,952 | | | | | | 6,392 | | | | | | 34,344 | | |
Total pro forma adjustments | | | | | — | | | | | | 36,891 | | | | | | 12,616 | | | | | | 49,507 | | |
Total pro forma net income (loss) | | | | $ | (23,619) | | | | | $ | 32,711 | | | | | $ | 15,093 | | | | | $ | 24,185 | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Credit Facility | | | | $ | 350,000 | | | | | $ | 250,000 | | |
Secured Promissory Notes | | | | | 1,668 | | | | | | 6,663 | | |
Mortgage Loans | | | | | 56,122 | | | | | | 38,856 | | |
Vehicle and Equipment Loans | | | | | 2,209 | | | | | | 1,951 | | |
Unamortized Debt Issuance Costs | | | | | (7,370) | | | | | | (7,545) | | |
Total Notes Payable | | | | $ | 402,629 | | | | | $ | 289,925 | | |
Less: Current Portion of Notes Payable | | | | | 258,880 | | | | | | 13,771 | | |
Total Long-Term Debt, net | | | | $ | 143,749 | | | | | $ | 276,154 | | |
| | | Number of Shares | | | Weighted Avg. Exercise Price C$ | | | Weighted Average Remaining Contractual Life | | |||||||||
Balance as of December 31, 2021 | | | | | 56,078 | | | | | | 30.60 | | | | | | 9.16 | | |
Vested | | | | | 18,798 | | | | | | 30.60 | | | | | ||||
Exercisable at June 30, 2022 | | | | | 24,167 | | | | | | 30.60 | | | | | | 8.67 | | |
| | | Number of Shares | | | Weighted Avg. Grant Date Fair Value C$ | | ||||||
Unvested Shares at December 31, 2021 | | | | | 2,413,887 | | | | | | 30.49 | | |
Granted | | | | | 2,748,440 | | | | | | 10.57 | | |
Forfeited | | | | | 975 | | | | | | 23.97 | | |
Vested | | | | | 1,189,055 | | | | | | 30.65 | | |
Unvested Shares at June 30, 2022 | | | | | 3,972,297 | | | | | | 16.66 | | |
| | | Six Months Ended June 30, | | |||||||||
| | | 2022 | | | 2021 | | ||||||
Weighted average grant date fair value (per share) of RSUs granted (C$) | | | | | 16.66 | | | | | | 30.60 | | |
Intrinsic value of RSUs vested, using market price at vest date (C$) (in thousands) | | | | | 15.41 | | | | | | — | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Stock Options Expense | | | | $ | 62 | | | | | $ | 115 | | | | | $ | 125 | | | | | $ | 168 | | |
Restricted Stock Units | | | | | 13,430 | | | | | | 12,465 | | | | | | 24,280 | | | | | | 18,165 | | |
Total Stock Based Compensation Expense | | | | $ | 13,492 | | | | | $ | 12,580 | | | | | $ | 24,405 | | | | | $ | 18,333 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Income before Income Taxes | | | | $ | 1,256 | | | | | $ | (6,152) | | | | | $ | 26,847 | | | | | $ | 3,642 | | |
Income Tax Expense | | | | | (11,103) | | | | | | (23,438) | | | | | | (36,617) | | | | | | (39,852) | | |
Effective Tax Rate | | | | | 662.9% | | | | | | 381.0% | | | | | | 112.3% | | | | | | 1093.8% | | |
| | | June 30, 2022 | | | December 31, 2021 | | ||||||
Weighted average remaining lease term (years) | | | | | 8.26 | | | | | | 8.52 | | |
Weighted average discount rate | | | | | 8.03% | | | | | | 8.11% | | |
Year Ending December 31, | | | | | | | | | | | | | |
Remainder 2022 | | | | $ | 6,851 | | | | | $ | 11,457 | | |
2023 | | | | | 13,244 | | | | | | 11,024 | | |
2024 | | | | | 12,519 | | | | | | 10,348 | | |
2025 | | | | | 11,590 | | | | | | 9,717 | | |
2026 | | | | | 10,722 | | | | | | 8,818 | | |
2027 and Thereafter | | | | | 47,894 | | | | | | 38,177 | | |
Total Lease Payments | | | | | 102,820 | | | | | | 89,541 | | |
Less: Interest | | | | | (28,737) | | | | | | (26,166) | | |
Present Value of Lease Liability | | | | $ | 74,083 | | | | | $ | 63,375 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Revenue, net of discounts | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 67,673 | | | | | $ | 59,312 | | | | | $ | 120,681 | | | | | $ | 108,473 | | |
Retail | | | | | 185,308 | | | | | | 156,873 | | | | | | 349,642 | | | | | | 236,068 | | |
Intersegment Eliminations | | | | | (29,319) | | | | | | (17,119) | | | | | | (44,426) | | | | | | (24,580) | | |
Total Revenue, net of discounts | | | | | 223,662 | | | | | | 199,066 | | | | | | 425,897 | | | | | | 319,961 | | |
| | | Three Months Ended June 30, | | | Six Months Ended June 30, | | ||||||||||||||||||
| | | 2022 | | | 2021 | | | 2022 | | | 2021 | | ||||||||||||
Depreciation and Amortization | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 19,089 | | | | | | 13,963 | | | | | | 38,814 | | | | | | 22,282 | | |
Retail | | | | | 16,388 | | | | | | 10,311 | | | | | | 31,097 | | | | | | 13,775 | | |
Total Depreciation and Amortization | | | | | 35,477 | | | | | | 24,274 | | | | | | 69,911 | | | | | | 36,057 | | |
Income taxes | | | | | | | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | | 1,265 | | | | | | 8,080 | | | | | | 12,502 | | | | | | 11,776 | | |
Retail | | | | | 9,838 | | | | | | 15,358 | | | | | | 24,115 | | | | | | 28,076 | | |
Total Income Taxes | | | | | 11,103 | | | | | | 23,438 | | | | | | 36,617 | | | | | | 39,852 | | |
|
| | | Consolidated VIE | | | Consolidated VOE | | | Consolidated VIE | | | Consolidated VOE | | ||||||||||||
| | | June 30, 2022 | | | December 31, 2021 | | ||||||||||||||||||
| | | | | | | | | | | | | | | (As Restated) | | |||||||||
Current Assets | | | | $ | 43,362 | | | | | $ | — | | | | | $ | 43,045 | | | | | $ | 20,464 | | |
Due To/(From) | | | | | (68,307) | | | | | | — | | | | | | (25,723) | | | | | | 14,228 | | |
Non-Current Assets | | | | | 96,342 | | | | | | — | | | | | | 207,908 | | | | | | 226,108 | | |
Current Liabilities | | | | | 14,359 | | | | | | — | | | | | | 32,934 | | | | | | 22,659 | | |
Non-Current Liabilities | | | | | 11,134 | | | | | | — | | | | | | 45,873 | | | | | | 45,603 | | |
Non-Controlling Interest | | | | | — | | | | | | — | | | | | | 1,276 | | | | | | — | | |
Equity attributable to Verano Holdings, Corp. | | | | | 45,904 | | | | | | — | | | | | | 145,147 | | | | | | 192,538 | | |
| | | As of June 30, 2022 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 92,833 | | | | | $ | — | | | | | $ | — | | | | | $ | 92,833 | | |
Investments | | | | | 3,842 | | | | | | — | | | | | | — | | | | | | 3,842 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (66,901) | | | | | | (66,901) | | |
Total | | | | $ | 96,675 | | | | | $ | — | | | | | $ | (66,901) | | | | | $ | 29,774 | | |
| | | As of December 31, 2021 | | |||||||||||||||||||||
| | | Level 1 | | | Level 2 | | | Level 3 | | | Total | | ||||||||||||
Cash and Cash Equivalents | | | | $ | 99,118 | | | | | $ | — | | | | | $ | — | | | | | $ | 99,118 | | |
Acquisition Consideration Payable | | | | | — | | | | | | — | | | | | | (208,349) | | | | | | (208,349) | | |
Total | | | | $ | 99,118 | | | | | $ | — | | | | | $ | (208,349) | | | | | $ | (109,231) | | |
| | | For the Three Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Revenue, net of discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | $ | 24,596 | | |
Gross Profit | | | | | 98,115 | | | | | | 69,210 | | | | | | 28,905 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (9,847) | | | | | | (29,688) | | | | | | 19,841 | | |
Net Loss per share – basic & diluted | | | | | (0.03) | | | | | | (0.10) | | | | | | 0.07 | | |
| | | Three Months Ended June 30, | | | 2022 — 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Cost of Goods Sold, net | | | | $ | 125,547 | | | | | $ | 129,856 | | | | | $ | (4,309) | | |
Selling, General, and Administrative Expenses | | | | | 100,263 | | | | | | 70,013 | | | | | | 30,250 | | |
Other Income (Expense) | | | | | 3,548 | | | | | | (5,994) | | | | | | 9,542 | | |
Provision for Income Taxes | | | | | (11,103) | | | | | | (23,438) | | | | | | 12,335 | | |
| | | For the Six Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Revenue, net of discounts | | | | $ | 425,897 | | | | | $ | 319,961 | | | | | $ | 105,936 | | |
Gross Profit | | | | | 196,732 | | | | | | 123,500 | | | | | | 73,232 | | |
Net Loss attributable to Verano Holdings Corp. | | | | | (10,061) | | | | | | (37,574) | | | | | | 27,513 | | |
Net Loss per share – basic & diluted | | | | | (0.03) | | | | | | (0.14) | | | | | | 0.11 | | |
| | | Six Months Ended June 30, | | | 2022 — 2021 | | ||||||||||||
($ in thousands) | | | 2022 | | | 2021 | | | $ Change | | |||||||||
Cost of goods sold, net | | | | $ | 229,165 | | | | | $ | 196,461 | | | | | $ | 32,704 | | |
Selling, General, and Administrative Expense | | | | | 189,824 | | | | | | 112,679 | | | | | | 77,145 | | |
Other Income (Expense) | | | | | 18,079 | | | | | | (8,627) | | | | | | 26,706 | | |
Provision for Income Taxes | | | | | (36,617) | | | | | | (39,852) | | | | | | 3,235 | | |
| | | Three Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | % Change | | |||||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 67,673 | | | | | $ | 59,312 | | | | | | 14.1% | | |
Retail | | | | $ | 185,308 | | | | | $ | 156,873 | | | | | | 18.1% | | |
Intersegment Eliminations | | | | $ | (29,319) | | | | | $ | (17,119) | | | | | | 71.3% | | |
Total Revenues, net of discounts | | | | $ | 223,662 | | | | | $ | 199,066 | | | | | | 12.4% | | |
| | | Six Months Ended June 30, | | | | | | | | |||||||||
($ in thousands) | | | 2022 | | | 2021 | | | % Change | | |||||||||
Revenues, net of discounts | | | | | | | | | | | | | | | | | | | |
Cultivation (Wholesale) | | | | $ | 120,681 | | | | | $ | 108,473 | | | | | | 11.3% | | |
Retail | | | | $ | 349,642 | | | | | $ | 236,068 | | | | | | 48.1% | | |
Intersegment Eliminations | | | | $ | (44,426) | | | | | $ | (24,580) | | | | | | 80.7% | | |
Total Revenues, net of discounts | | | | $ | 425,897 | | | | | $ | 319,961 | | | | | | 33.1% | | |
| | | Six Months Ended June 30, | | | | | | | | |||||||||
| | | 2022 | | | 2021 | | | $ Change | | |||||||||
Net Cash Provided by Operating Activities | | | | $ | 43,648 | | | | | $ | 56,845 | | | | | | (13,197) | | |
Net Cash Used in Investing Activities | | | | | (159,476) | | | | | | (160,442) | | | | | | 966 | | |
Net Cash Provided by Financing Activities | | | | | 109,543 | | | | | | 236,861 | | | | | | (127,318) | | |
| | | Goodness Growth (Historical) | | | Verano (Historical) | | | Transaction Adjustments | | | | | | Pro Forma Combined | | ||||||||||||
Assets | | | | | | | | | | | | | | | | | | | | | | |||||||
Current assets: | | | | | | | | | | | | | | | | | | | | | | |||||||
Cash | | | | $ | 16,970,729 | | | | | $ | 92,833,000 | | | | | $ | — | | | | | | | | $ | 109,803,729 | | |
Accounts receivable, net of allowance for doubtful accounts | | | | | 6,488,784 | | | | | | 13,253,000 | | | | | | (1,770,104) | | | | A | | | | | 17,971,680 | | |
Inventory | | | | | 18,607,668 | | | | | | 154,050,000 | | | | | | 20,034,709 | | | | B | | | | | 192,692,377 | | |
Prepayments and other current assets | | | | | 2,591,556 | | | | | | 27,820,000 | | | | | | — | | | | | | | | | 30,411,556 | | |
Assets Held for Sale | | | | | 1,729,017 | | | | | | — | | | | | | — | | | | | | | | | 1,729,017 | | |
Total current assets | | | | | 46,387,754 | | | | | | 287,956,000 | | | | | | 18,264,605 | | | | | | | | | 352,608,359 | | |
Property and equipment, net | | | | | 94,225,562 | | | | | | 515,698,000 | | | | | | 5,000,000 | | | | C | | | | | 614,923,562 | | |
Operating lease, right-of-use asset | | | | | 7,852,578 | | | | | | 71,472,000 | | | | | | — | | | | | | | | | 79,324,578 | | |
Notes receivable, long-term | | | | | 3,750,000 | | | | | | — | | | | | | — | | | | | | | | | 3,750,000 | | |
Intangible assets, net | | | | | 9,771,479 | | | | | | 1,343,371,000 | | | | | | (9,771,479) | | | | E | | | | | 1,506,663,073 | | |
| | | | | | | | | | | | | | | | | 163,292,073 | | | | D | | | | | | | |
Goodwill | | | | | 183,836 | | | | | | 376,637,000 | | | | | | (183,836) | | | | E | | | | | 390,268,000 | | |
| | | | | | | | | | | | | | | | | 13,631,000 | | | | F | | | |||||
Deposits | | | | | 2,121,487 | | | | | | 2,584,000 | | | | | | — | | | | | | | | | 4,705,487 | | |
Investment in Associates | | | | | — | | | | | | 7,252,000 | | | | | | — | | | | | | | | | 7,252,000 | | |
Deferred tax assets | | | | | 4,530,000 | | | | | | — | | | | | | — | | | | | | | | | 4,530,000 | | |
Total assets | | | | $ | 168,822,696 | | | | | $ | 2,604,970,000 | | | | | $ | 190,232,363 | | | | | | | | $ | 2,964,025,059 | | |
Liabilities | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Current liabilities | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Accounts Payable and Accrued liabilities | | | | | 15,608,858 | | | | | | 253,035,000 | | | | | | (1,770,104) | | | | A | | | | | 272,973,754 | | |
| | | | | | | | | | | | | | | | | 1,000,000 | | | | G | | | |||||
| | | | | | | | | | | | | | | | | 5,100,000 | | | | H | | | |||||
Right of use liability | | | | | 1,775,746 | | | | | | 7,961,000 | | | | | | — | | | | | | | | | 9,736,746 | | |
Long-Term debt, current portion | | | | | — | | | | | | 258,880,000 | | | | | | — | | | | | | | | | 258,880,000 | | |
Liabilities held for sale | | | | | 1,140,828 | | | | | | — | | | | | | — | | | | | | | | | 1,140,828 | | |
Acquisition Price Payable | | | | | — | | | | | | 66,901,000 | | | | | | — | | | | | | | | | 66,901,000 | | |
Total current liabilities | | | | | 18,525,432 | | | | | | 586,777,000 | | | | | | 4,329,896 | | | | | | | | | 609,632,328 | | |
Right-of-use liability, net of current portion | | | | | 80,452,937 | | | | | | 66,122,000 | | | | | | — | | | | | | | | | 146,574,937 | | |
Deferred Revenue | | | | | — | | | | | | 271,000 | | | | | | — | | | | | | | | | 271,000 | | |
Deferred Income Taxes | | | | | — | | | | | | 259,326,000 | | | | | | — | | | | | | | | | 259,326,000 | | |
Long-Term debt, net of current portion | | | | | 45,847,769 | | | | | | 143,749,000 | | | | | | — | | | | | | | | | 189,596,769 | | |
Total liabilities | | | | $ | 144,826,138 | | | | | $ | 1,056,245,000 | | | | | $ | 4,329,896 | | | | | | | | $ | 1,205,401,034 | | |
Stockholders’ equity | | | | | 23,996,558 | | | | | | 1,548,725,000 | | | | | | 215,999,025 | | | | I | | | | | 1,758,624,025 | | |
| | | | | | | | | | | | | | | | | (23,996,558) | | | | J | | | |||||
| | | | | | | | | | | | | | | | | (6,100,000) | | | | G, H | | | |||||
Non-controlling interest | | | | | — | | | | | | — | | | | | | — | | | | | | | | | — | | |
Total liabilities and stockholders’ equity | | | | | 168,822,696 | | | | | | 2,604,970,000 | | | | | | 190,232,363 | | | | | | | | | 2,964,025,059 | | |
| | | Goodness Growth | | | Verano (Restated) | | | Transaction Adjustments | | | | | | Pro Forma Combined | | ||||||||||||
Assets | | | | | | | | | | | | | | | | | | | | | | |||||||
Current assets: | | | | | | | | | | | | | | | | | | | | | | |||||||
Cash | | | | $ | 15,155,279 | | | | | $ | 99,118,000 | | | | | $ | — | | | | | | | | $ | 114,273,279 | | |
Accounts receivable, net of allowance for doubtful accounts | | | | | 4,502,469 | | | | | | 17,410,000 | | | | | | (14,218) | | | | (a) | | | | | 21,898,251 | | |
Inventory | | | | | 20,422,061 | | | | | | 140,703,000 | | | | | | — | | | | | | | | | 161,125,061 | | |
Prepayments and other current assets | | | | | 1,560,113 | | | | | | 19,528,000 | | | | | | — | | | | | | | | | 21,088,113 | | |
Notes receivable | | | | | — | | | | | | 285,000 | | | | | | — | | | | | | | | | 285,000 | | |
Total current assets | | | | | 41,639,922 | | | | | | 277,044,000 | | | | | | (14,218) | | | | | | | | | 318,669,704 | | |
Property and equipment, net | | | | | 99,488,559 | | | | | | 452,232,000 | | | | | | — | | | | | | | | | 551,720,559 | | |
Operating lease, right-of-use asset | | | | | 8,510,499 | | | | | | 61,346,000 | | | | | | — | | | | | | | | | 69,856,499 | | |
Notes receivable, long-term | | | | | 3,750,000 | | | | | | — | | | | | | — | | | | | | | | | 3,750,000 | | |
Intangible assets, net | | | | | 10,184,289 | | | | | | 1,379,913,000 | | | | | | — | | | | (b) | | | | | 1,390,097,289 | | |
Goodwill | | | | | 183,836 | | | | | | 368,130,000 | | | | | | — | | | | | | | | | 368,313,836 | | |
Investments in associates | | | | | — | | | | | | 7,491,000 | | | | | | — | | | | | | | | | 7,491,000 | | |
Deposits | | | | | 1,718,206 | | | | | | 2,499,000 | | | | | | — | | | | | | | | | 4,217,206 | | |
Deferred tax assets | | | | | 1,495,000 | | | | | | — | | | | | | — | | | | | | | | | 1,495,000 | | |
Total assets | | | | $ | 166,970,311 | | | | | $ | 2,548,655,000 | | | | | $ | (14,218) | | | | | | | | $ | 2,715,611,093 | | |
Liabilities | | | | | | | | | | | | | | | | | | | | | | |||||||
Current liabilities | | | | | | | | | | | | | | | | | | | | | | |||||||
Accounts Payable and Accrued liabilities | | | | | 14,805,473 | | | | | | 241,833,000 | | | | | | (14,218) | | | | (a) | | | | | 256,624,255 | | |
Right of use liability | | | | | 1,600,931 | | | | | | 6,563,000 | | | | | | — | | | | | | | | | 8,163,931 | | |
Long-Term debt, current portion | | | | | — | | | | | | 13,771,000 | | | | | | — | | | | | | | | | 13,771,000 | | |
Acquisition price payable | | | | | — | | | | | | 208,349,000 | | | | | | — | | | | | | | | | 208,349,000 | | |
Total current liabilities | | | | | 16,406,404 | | | | | | 470,516,000 | | | | | | (14,218) | | | | | | | | | 486,908,186 | | |
Right-of-use liability, net of current portion | | | | | 80,228,097 | | | | | | 56,812,000 | | | | | | — | | | | | | | | | 137,040,097 | | |
Deferred income taxes | | | | | — | | | | | | 262,184,000 | | | | | | — | | | | | | | | | 262,184,000 | | |
Deferred revenue | | | | | — | | | | | | 1,183,000 | | | | | | — | | | | | | | | | 1,183,000 | | |
Long-term debt, net of current portion | | | | | 27,329,907 | | | | | | 276,154,000 | | | | | | — | | | | | | | | | 303,483,907 | | |
Total liabilities | | | | $ | 123,964,408 | | | | | $ | 1,066,849,000 | | | | | $ | (14,218) | | | | | | | | $ | 1,190,799,190 | | |
Stockholders’ equity | | | | | 43,005,903 | | | | | | 1,480,530,000 | | | | | | — | | | | (a) (b) | | | | | 1,523,535,903 | | |
Non-controlling interest | | | | | — | | | | | | 1,276,000 | | | | | | — | | | | | | | | | 1,276,000 | | |
Total liabilities and stockholders’ equity | | | | $ | 166,970,311 | | | | | $ | 2,548,655,000 | | | | | $ | (14,218) | | | | | | | | $ | 2,715,611,093 | | |
| | | Goodness Growth (Historical) | | | Verano (Historical) | | | Transaction Adjustments | | | | | | Pro Forma Combined | | ||||||||||||
Revenue | | | | $ | 36,728,720 | | | | | $ | 425,897,000 | | | | | $ | (1,114,461) | | | | AA | | | | $ | 461,511,259 | | |
Cost of sales | | | | | 23,873,016 | | | | | | 229,165,000 | | | | | | (1,114,461) | | | | AA | | | | | 251,923,555 | | |
Gross profit | | | | | 12,855,704 | | | | | | 196,732,000 | | | | | | — | | | | | | | | | 209,587,704 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | |||||||
Selling, general and administrative | | | | | 17,903,408 | | | | | | 138,350,000 | | | | | | — | | | | | | | | | 156,253,408 | | |
Stock-based compensation expenses | | | | | 1,740,513 | | | | | | 20,377,000 | | | | | | (1,740,513) | | | | DD | | | | | 20,377,000 | | |
Depreciation & Amortization | | | | | 663,757 | | | | | | 31,097,000 | | | | | | 5,443,069 | | | | EE | | | | | 37,203,826 | | |
Total operating expenses | | | | | 20,307,678 | | | | | | 189,824,000 | | | | | | 3,702,556 | | | | | | | | | 213,834,234 | | |
(Loss) income from investments in associates | | | | | — | | | | | | 1,860,000 | | | | | | — | | | | | | | | | 1,860,000 | | |
(Loss) income from operations | | | | | (7,451,974) | | | | | | 8,768,000 | | | | | | (3,702,556) | | | | | | | | | (2,386,530) | | |
Other income (expense): | | | | | | | | | | | | | | | | | | | | | | |||||||
Impairment of long-lived assets | | | | | (5,367,915) | | | | | | — | | | | | | — | | | | | | | | | (5,367,915) | | |
Gain (loss) on disposal of assets | | | | | 157,429 | | | | | | (1,192,000) | | | | | | — | | | | | | | | | (1,034,571) | | |
Gain on deconsolidation | | | | | — | | | | | | 9,485,000 | | | | | | — | | | | | | | | | 9,485,000 | | |
Gain on Previously Held Equity Interest | | | | | — | | | | | | 13,928,000 | | | | | | — | | | | | | | | | 13,928,000 | | |
Interest expenses, net | | | | | (9,899,622) | | | | | | (22,295,000) | | | | | | — | | | | | | | | | (32,194,622) | | |
Other income (expenses) | | | | | 1,117,224 | | | | | | 18,153,000 | | | | | | — | | | | | | | | | 19,270,224 | | |
Other income (expenses), net | | | | | (13,992,884) | | | | | | 18,079,000 | | | | | | — | | | | | | | | | 4,086,116 | | |
Income (Loss) before provision for income taxes and non-controlling interest | | | | | (21,444,858) | | | | | | 26,847,000 | | | | | | (3,702,556) | | | | | | | | | 1,699,586 | | |
Provision for income taxes | | | | | 695,000 | | | | | | (36,617,000) | | | | | | — | | | | | | | | | (35,922,000) | | |
Net income (loss) before non-controlling interest | | | | | (20,749,858) | | | | | | (9,770,000) | | | | | | (3,702,556) | | | | | | | | | (34,222,414) | | |
Net income (loss) attributable to non-controlling interest | | | | | — | | | | | | 291,000 | | | | | | — | | | | | | | | | 291,000 | | |
Net income (loss) after non-controlling interest | | | | $ | (20,749,858) | | | | | $ | (10,061,000) | | | | | $ | (3,702,556) | | | | | | | | $ | (34,513,414) | | |
Net income (loss) per share – basic | | | | $ | (0.16) | | | | | $ | (0.03) | | | | | $ | 0.09 | | | | | | | | $ | (0.10) | | |
Net income (loss) per share – diluted | | | | $ | (0.16) | | | | | $ | (0.03) | | | | | $ | 0.09 | | | | | | | | $ | (0.10) | | |
Weighted average shares used in computation of net income (loss) per share – basic | | | | | 128,111,328 | | | | | | 327,402,503 | | | | | | (99,091,550) | | | | FF | | | | | 356,422,281 | | |
Weighted average shares used in computation of net income (loss) per share – diluted | | | | | 128,111,328 | | | | | | 327,402,503 | | | | | | (99,091,550) | | | | FF | | | | | 356,422,281 | | |
| | | Goodness Growth (Historical) | | | Verano (Historical) as (Restated) | | | Transaction Adjustments | | | | | | Pro Forma Combined | | ||||||||||||
Revenue | | | | $ | 54,446,168 | | | | | $ | 737,850,000 | | | | | $ | (40,702) | | | | AA | | | | $ | 792,255,466 | | |
Cost of sales | | | | | 34,647,483 | | | | | | 406,831,000 | | | | | | (40,702) | | | | AA | | | | | 441,437,781 | | |
Gross profit | | | | | 19,798,685 | | | | | | 331,019,000 | | | | | | — | | | | | | | | | 350,817,685 | | |
Operating expenses: | | | | | | | | | | | | | | | | | | | | | | |||||||
Selling, general and administrative | | | | | 33,655,780 | | | | | | 187,439,000 | | | | | | 5,100,000 | | | | BB | | | | | 227,194,780 | | |
| | | | | | | | | | | | | | | | | 1,000,000 | | | | CC | | | | | | | |
Stock-based compensation expenses | | | | | 5,182,641 | | | | | | 41,706,000 | | | | | | (2,945,557) | | | | DD | | | | | 43,943,084 | | |
Depreciation & Amortization | | | | | 1,441,828 | | | | | | 41,784,000 | | | | | | 10,886,138 | | | | EE | | | | | 54,111,966 | | |
Total operating expenses | | | | | 40,280,249 | | | | | | 270,929,000 | | | | | | 14,040,581 | | | | | | | | | 325,249,830 | | |
(Loss) income from investments in associates | | | | | — | | | | | | 4,623,000 | | | | | | — | | | | | | | | | 4,623,000 | | |
Income (loss) from operations | | | | | (20,481,564) | | | | | | 64,713,000 | | | | | | (14,040,581) | | | | | | | | | 30,190,855 | | |
Other income (expense): | | | | | | | | | | | | | | | | | | | | | | |||||||
Impairment of long-lived assets | | | | | (5,169,951) | | | | | | — | | | | | | — | | | | | | | | | (5,169,951) | | |
Loss on disposal of property and equipment | | | | | — | | | | | | (1,085,000) | | | | | | — | | | | | | | | | (1,085,000) | | |
Gain on disposal of assets | | | | | 6,903,039 | | | | | | — | | | | | | — | | | | | | | | | 6,903,039 | | |
Interest expenses, net | | | | | (10,575,370) | | | | | | (24,270,000) | | | | | | — | | | | | | | | | (34,845,370) | | |
Other income (expenses) | | | | | (244,629) | | | | | | 9,632,000 | | | | | | — | | | | | | | | | 9,387,371 | | |
Other income (expenses), net | | | | | (9,086,911) | | | | | | (15,723,000) | | | | | | — | | | | | | | | | (24,809,911) | | |
Income (Loss) before provision for income taxes and non-controlling interest | | | | | (29,568,475) | | | | | | 48,990,000 | | | | | | (14,040,581) | | | | | | | | | 5,380,944 | | |
Provision for income taxes | | | | | (4,122,000) | | | | | | (103,988,000) | | | | | | — | | | | | | | | | (108,110,000) | | |
Net income (loss) before non-controlling interest | | | | | (33,690,475) | | | | | | (54,998,000) | | | | | | (14,040,581) | | | | | | | | | (102,729,056) | | |
Net income (loss) attributable to non-controlling interest | | | | | — | | | | | | 2,509,000 | | | | | | — | | | | | | | | | 2,509,000 | | |
Net income (loss) after non-controlling interest | | | | $ | (33,690,475) | | | | | $ | (57,507,000) | | | | | $ | (14,040,581) | | | | | | | | $ | (105,238,056) | | |
Net income (loss) per share – basic | | | | $ | (0.27) | | | | | $ | (0.20) | | | | | $ | 0.14 | | | | | | | | $ | (0.33) | | |
Net income (loss) per share – diluted | | | | $ | (0.27) | | | | | $ | (0.20) | | | | | $ | 0.14 | | | | | | | | $ | (0.33) | | |
Weighted average shares used in computation of net income (loss) per share – basic | | | | | 123,814,521 | | | | | | 290,443,432 | | | | | | (94,794,743) | | | | FF | | | | | 319,463,210 | | |
Weighted average shares used in computation of net income (loss) per share – diluted | | | | | 123,814,521 | | | | | | 290,443,432 | | | | | | (94,794,743) | | | | FF | | | | | 319,463,210 | | |
| Goodness Growth’s Subordinated Voting Shares at June 30, 2022 | | | | | 128,111,328 | | |
| Exchange Ratio | | | | | 0.22652 | | |
| Verano Common Shares hypothetically issued based on the Exchange Ratio | | | | | 29,019,778 | | |
| Price per Verano Common Share on Measurement Date (September 9, 2022) | | | | $ | 6.42 | | |
| Total estimated fair value of acquired Verano Common Shares | | | | $ | 186,306,975 | | |
| Total estimated fair value of dilutive securities | | | | $ | 29,692,050 | | |
| Total estimated fair value | | | | $ | 215,999,025 | | |
| | | June 30, 2022 | | |||
Pro forma earnings per Verano Subordinated Voting Shares – basic | | | | | | | |
Historical basic weighted average Verano Common Shares at June 30, 2022 | | | | | 327,402,503 | | |
Incremental Verano Common Shares issued in the Arrangement | | | | | 29,019,778 | | |
Pro forma combined basic weighted average Verano Common Shares | | | | | 356,422,281 | | |
Pro forma combined net income for the six months ended June 30, 2022 | | | | $ | (34,513,414) | | |
Pro forma combined earnings per Verano Common Shares – basic | | | | $ | (0.10) | | |
Pro forma earnings per Verano Subordinated Voting Shares – diluted | | | | | | | |
Historical diluted weighted average Verano Common Shares at June 30, 2022 | | | | | 327,402,503 | | |
Incremental Verano Common Shares issued in the Arrangement | | | | | 29,019,778 | | |
Pro forma combined diluted weighted average Verano Common Shares | | | | | 356,422,281 | | |
Pro forma combined net income for the six months ended June 30, 2022 | | | | $ | (34,513,414) | | |
Pro forma combined earnings per Verano Common Shares – diluted | | | | $ | (0.10) | | |
| | | December 31, 2021 | | |||
Pro forma earnings per Verano Subordinated Voting Shares – basic | | | | | | | |
Historical basic weighted average Verano Common Shares at December 31, 2021 | | | | | 290,443,432 | | |
Incremental Verano Common Shares issued in the Arrangement | | | | | 29,019,778 | | |
Pro forma combined basic weighted average Verano Common Shares | | | | | 319,463,210 | | |
Pro forma combined net income for the year ended December 31, 2021 | | | | $ | (105,238,056) | | |
Pro forma combined earnings per Verano Common Shares – basic | | | | $ | (0.33) | | |
Pro forma earnings per Verano Subordinated Voting Shares – diluted | | | | | | | |
Historical diluted weighted average Verano Common Shares at December 31, 2021 | | | | | 290,443,432 | | |
Incremental Verano Common Shares issued in the Arrangement | | | | | 29,019,778 | | |
Pro forma combined diluted weighted average Verano Common Shares | | | | | 319,463,210 | | |
Pro forma combined net income for the year ended December 31, 2021 | | | | $ | (105,238,056) | | |
Pro forma combined earnings per Verano Common Shares – diluted | | | | $ | (0.33) | | |
| | | Fair Value | | |||
Assets Acquired | | | | | | | |
Cash | | | | $ | 16,970,729 | | |
Accounts receivable, net of allowance for doubtful accounts | | | | | 6,488,784 | | |
Inventory | | | | | 38,642,377 | | |
Prepayments and other current assets | | | | | 2,591,556 | | |
Property and equipment, net | | | | | 99,225,562 | | |
Operating lease, right-of-use asset | | | | | 7,852,578 | | |
Notes receivable, long-term | | | | | 3,750,000 | | |
Deposits | | | | | 2,121,487 | | |
Deferred tax assets | | | | | 4,530,000 | | |
Other | | | | | 1,729,017 | | |
Total assets acquired | | | | | 183,902,090 | | |
Liabilities Assumed | | | | | | | |
Accounts Payable and Accrued liabilities | | | | | (15,608,858) | | |
Right of use liability | | | | | (82,228,683) | | |
Long-Term debt, net of current portion | | | | | (45,847,769) | | |
Other | | | | | (1,140,828) | | |
Total liabilities assumed | | | | | (144,826,138) | | |
Purchase price allocated | | | | $ | 39,075,952 | | |
| | | Fair Value | | |||
Assets Acquired | | | | | | | |
Cash | | | | $ | 16,970,729 | | |
Accounts receivable, net of allowance for doubtful accounts | | | | | 6,488,784 | | |
Inventory | | | | | 38,642,377 | | |
Prepayments and other current assets | | | | | 2,591,556 | | |
Property and equipment, net | | | | | 99,225,562 | | |
Operating lease, right-of-use asset | | | | | 7,852,578 | | |
Notes receivable, long-term | | | | | 3,750,000 | | |
Deposits | | | | | 2,121,487 | | |
Deferred tax assets | | | | | 4,530,000 | | |
Other | | | | | 1,729,017 | | |
Total assets acquired | | | | | 183,902,090 | | |
Liabilities Assumed | | | | | | | |
Accounts Payable and Accrued liabilities | | | | | (15,608,858) | | |
Right of use liability | | | | | (82,228,683) | | |
Long-Term debt, net of current portion | | | | | (45,847,769) | | |
Other | | | | | (1,140,828) | | |
Total liabilities assumed | | | | | (144,826,138) | | |
Purchase price allocated | | | | $ | 39,075,952 | | |
| Estimated Purchase Price | | | | $ | 215,999,025 | | |
| Allocation to Goodwill | | | | $ | 13,631,000 | | |
| Allocation to Intangibles | | | | $ | 163,292,073 | | |