Goodness Growth Holdings, Inc. (Form: 10-Q, Received: 11/10/2021 16:44:30)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended September 30, 2021


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

For the transition period from to

Commission File Number: 000-56225

GOODNESS GROWTH HOLDINGS, INC.

(Exact name of registrant as specified in its charter)


British Columbia, Canada		82-3835655
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

207 South 9^th Street, Minneapolis, MN		55402
(Address of principal executive offices)		(Zip Code)

	(612) 999-1606
	(Registrant’s telephone number, including area code)

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


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	None	None

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

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

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

Large accelerated filer	◻	Accelerated filer	◻
Non-accelerated filer	þ	Smaller reporting company	☑
		Emerging growth company	☑

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

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

As of November 8, 2021, the registrant had the following number of shares of each of its classes of registered securities outstanding: Subordinate Voting Shares – 79,538,377; Multiple Voting Shares – 402,720; and Super Voting Shares – 65,411.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

GOODNESS GROWTH HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

(In U.S Dollars, unaudited and condensed)


	September 30,		December 31,
	2021		2020
Assets
Current assets:
Cash	$	11,779,295	$	25,513,180
Restricted cash		—		1,592,500
Accounts receivable, net of allowance for doubtful accounts of $189,467 and $132,490, respectively		975,205		696,994
Inventory		20,141,951		12,644,895
Prepayments and other current assets		3,145,490		1,552,278
Notes receivable		19,954		293,700
Deferred acquisition costs		—		28,136
Assets Held for Sale		8,692,419		4,596,445
Deferred financing costs		—		120,266
Total current assets		44,754,314		47,038,394
Property and equipment, net		99,954,310		30,566,259
Operating lease, right-of-use asset		8,417,965		8,163,844
Notes receivable, long-term		3,750,000		3,750,000
Intangible assets, net		5,421,895		8,409,419
Goodwill		183,836		3,132,491
Deposits		1,344,283		1,412,124
Deferred tax assets		337,000		157,000
Total assets	$	164,163,603	$	102,629,531
Liabilities
Current liabilities
Accounts Payable and Accrued liabilities		9,525,659		13,477,303
Right of use liability		1,403,465		857,294
Convertible notes, net of issuance costs		—		900,000
Long-Term debt, current portion		1,110,000		1,110,000
Liabilities held for sale		116,803		3,595,301
Warrant Liability		3,078,694		—
Total current liabilities		15,234,621		19,939,898
Right-of-use liability		78,606,734		20,343,063
Long-Term debt		19,411,212		—
Total liabilities	$	113,252,567	$	40,282,961

Commitments and contingencies (refer to Note 20)

Stockholders’ equity
Subordinate Voting Shares ($- par value, unlimited shares authorized; 79,538,377 shares issued and outstanding)		—		—
Multiple Voting Shares ($- par value, unlimited shares authorized; 402,720 shares issued and outstanding)		—		—
Super Voting Shares ($- par value; unlimited shares authorized; 65,411 shares issued and outstanding, respectively)		—		—
Additional Paid in Capital		171,354,487		164,079,614
Accumulated deficit		(120,443,451)		(101,733,044)
Total stockholders' equity	$	50,911,036	$	62,346,570
Total liabilities and stockholders' equity	$	164,163,603	$	102,629,531

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

GOODNESS GROWTH HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF NET INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)

(In U.S. Dollars, unaudited and condensed)


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Revenue	$	13,369,432	$	12,475,782	$	40,790,221	$	36,809,714
Cost of sales
Product costs		7,903,444		7,360,671		22,682,503		24,492,831
Inventory valuation adjustments		351,000		151,328		464,000		484,570
Gross profit		5,114,988		4,963,783		17,643,718		11,832,313
Operating expenses:
Selling, general and administrative		8,106,187		6,517,464		24,441,860		19,677,932
Stock-based compensation expenses		835,122		524,052		4,557,777		12,245,412
Depreciation		98,098		38,097		515,907		260,725
Amortization		206,442		153,356		619,327		461,737
Total operating expenses		9,245,849		7,232,969		30,134,871		32,645,806

Loss from operations		(4,130,861)		(2,269,186)		(12,491,153)		(20,813,493)

Other income (expense):
Loss on sale of property and equipment		—		—		—		(13,800)
Gain on disposal of assets held for sale		—		16,884,173		437,107		16,884,173
Loss on assets held for sale		—		(446,544)		—		(446,544)
Derivative gain (loss)		627,165		(4,066,335)		2,317,065		(5,032,537)
Interest expenses, net		(2,254,553)		(1,255,656)		(6,037,057)		(4,249,090)
Other income (expenses)		75,018		108,552		33,631		(205,061)
Other income (expenses), net		(1,552,370)		11,224,190		(3,249,254)		6,937,141

Loss before income taxes		(5,683,231)		8,955,004		(15,740,407)		(13,876,352)

Current income tax expenses		(530,000)		(3,723,000)		(3,150,000)		(4,575,000)
Deferred income tax recoveries		(30,000)		(2,280,000)		180,000		(2,225,000)
Net income (loss) and comprehensive income (loss)		(6,243,231)		2,952,004		(18,710,407)		(20,676,352)
Net income (loss) per share - basic and diluted	$	(0.05)	$	0.03	$	(0.15)	$	(0.22)
Weighted average shares used in computation of net income (loss) per share - basic		126,363,104		98,871,038		122,704,872		95,433,233
Weighted average shares used in computation of net income (loss) per share - diluted		126,363,104		112,517,113		122,704,872		95,433,233

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

GOODNESS GROWTH HOLDINGS, INC.

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

(In U.S. Dollars, unaudited and condensed)


	Common Stock
	SVS			MVS			Super Voting Shares							Total
										Additional Paid-		Accumulated		Stockholders'
	Shares	Amount		Shares	Amount		Shares	Amount		in Capital		Deficit		Equity
Balance, January 1, 2020	23,684,411	$	—	549,928	$	—	65,411		—	$	127,476,624	$	(78,790,850)	$	48,685,774
Shares issued in private placement	13,651,574		—	—		—	—		—		4,058,460		—		4,058,460
Stock-based compensation	—		—	—		—	—		—		12,245,412		—		12,245,412
Net loss	—		—	—		—	—		—		—		(20,676,352)		(20,676,352)
Balance at September 30, 2020	37,335,985	$	—	549,928	$	—	65,411	$	—	$	143,780,496	$	(99,467,202)	$	44,313,294

Balance, January 1, 2021	51,062,559		—	554,128		—	65,411		—	$	164,079,614	$	(101,733,044)	$	62,346,570
Conversion of MVS shares	15,140,700		—	(151,408)		—	—		—		—		—		—
Shares issued in Nevada acquisition	1,050,000		—	—		—	—		—		1,564,500		—		1,564,500
Shares issued	1,185,293		—	—		—	—		—		2,314,016		—		2,314,016
Options exercised	3,989,344		—	—		—	—		—		1,152,596		—		1,152,596
Warrants exercised	7,110,481		—	—		—	—		—		—		—		—
Stock-based compensation	—		—	—		—	—		—		2,243,761		—		2,243,761
Net Loss	—		—	—		—	—		—		—		(18,710,407)		(18,710,407)
Balance at September 30, 2021	79,538,377	$	—	402,720	$	—	65,411	$	—	$	171,354,487	$	(120,443,451)	$	50,911,036

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

GOODNESS GROWTH HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In U.S. Dollars, except for per share data, unaudited and condensed)


	Nine Months Ended September 30,
	September 30,
	2021		2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(18,710,407)	$	(20,676,352)
Adjustments to reconcile net loss to net cash used in operating activities:
Inventory valuation adjustments		464,000		484,570
Depreciation		515,907		260,725
Depreciation capitalized into inventory		1,678,558		1,757,281
Non-cash operating lease expense		764,266		943,905
Amortization of intangible assets		619,327		461,737
Stock-based payments		4,557,777		12,245,412
Loss on assets held for sale		—		446,544
Interest Expense		1,764,711		—
Gain/loss		—		65,930
Deferred income tax		(180,000)		710,301
Gain on disposal of business		—		(16,884,173)
Accretion		310,704		573,573
Derivative (Gain) Loss		(2,317,065)		5,032,537
Gain on disposal of OMS		(437,107)		—
Change in operating assets and liabilities:
Accounts Receivable		18,384		(302)
Prepaid expenses		(1,573,909)		(239,174)
Inventory		(7,765,288)		(1,091,279)
Accounts payable and accrued liabilities		(2,555,634)		4,759,842
Held for sale assets and liabilities		8,575,615		153,146
Change in assets and liabilities held for sale		(8,450,772)		—
Net cash used in operating activities	$	(22,720,933)	$	(10,995,777)

CASH FLOWS FROM INVESTING ACTIVITIES:
PP&E Additions	$	(14,637,331)	$	(3,581,289)
Proceeds from sale of PAMS net of cash		—		16,637,489
Proceeds from sale of OMS net of cash		1,150,000		—
Deposits		67,841		282,943
Net cash provided by (used in) investing activities	$	(13,419,490)	$	13,339,143

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of shares	$	—	$	7,613,490
Deferred financing costs		(865,769)		—
Proceeds from long-term debt		24,028,295		—
Convertible debt payment		(900,000)		—
Proceeds from option exercises		1,152,596		—
Debt interest payments		—		(65,962)
Lease payments		(1,008,584)		(1,250,799)
Net cash provided by financing activities	$	22,406,538	$	6,296,729

Net change in cash and restricted cash	$	(13,733,885)	$	8,640,095

Cash and restricted cash, beginning of period	$	25,513,180	$	9,234,173

Cash and restricted cash, end of period	$	11,779,295	$	17,874,268

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

GOODNESS GROWTH HOLDINGS, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

1. Description of Business and Summary

Goodness Growth Holdings, Inc. (“Goodness Growth” or the “Company”) (formerly, Darien Business Development Corp.) was incorporated under the Alberta Business Corporations Act on November 23, 2004. On March 18, 2019, the Company completed a Reverse Takeover Transaction (“RTO”) with Vireo Health Inc. (“Vireo U.S.”), whereby the Company acquired Vireo U.S., the shareholders of Vireo U.S. became the controlling shareholders of the Company, and the Company changed its name to Vireo Health International, Inc. Following the RTO, the Company was listed on the Canadian Securities Exchange (the “CSE”) under ticker symbol “VREO”. On June 9, 2021, the Company changed its name to Goodness Growth Holdings, Inc. and its ticker symbol on the CSE to “GDNS.”

Goodness Growth is a physician-led, science-focused organization that cultivates and manufactures pharmaceutical-grade cannabis and cannabis extracts. Goodness Growth operates cannabis cultivation, production, and dispensary facilities in Arizona, Maryland, Minnesota, New Mexico, and New York through its subsidiaries.

While marijuana and CBD-infused products are legal under the laws of a large number of U.S. states (with vastly differing restrictions), the United States Federal Controlled Substances Act classifies all “marijuana” as a Schedule I drug. Under U.S. federal law, a Schedule I drug or substance has a high potential for abuse, no accepted medical use in the United States, and a lack of safety for the use of the drug under medical supervision. Recently some federal officials have attempted to distinguish between medical cannabis use as necessary, but recreational use is “still a violation of federal law.” At the present time, the distinction between “medical marijuana” and “recreational marijuana” does not exist under U.S. federal law.

Since being declared a global pandemic in March 2020, the spread of COVID-19 has severely impacted virtually all areas of the globe. In many countries, including the United States, businesses were forced to cease or limit operations for long or indefinite periods of time. Measures taken to contain the spread of the virus, including travel bans, quarantines, social distancing, and closures of non-essential services triggered significant disruptions to businesses worldwide, resulting in an economic slowdown. Global stock markets have also experienced great volatility. Governments and central banks have responded with monetary and fiscal interventions to stabilize economic conditions.

The duration and impact of the COVID-19 pandemic, as well as the effectiveness of government and central bank responses, remains unclear at this time notwithstanding the loosening or elimination of restrictions in some areas. It is not possible to reliably estimate the duration and severity of these consequences, as well as their impact on the financial position and results of the Company for future periods.

2. Summary of Significant Accounting Policies

Basis of presentation

The accompanying unaudited condensed consolidated financial statements reflect the accounts of the Company. The information included in these statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Form 10-K for the year ended December 31, 2020 (the “Annual Financial Statements”). The unaudited condensed consolidated financial statements were prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”).

These unaudited condensed consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue in operation for the foreseeable future and, accordingly, will be able to realize its assets and discharge its liabilities in the normal course of operations as they come due.

For the three and nine months ended September 30, 2021, the Company reported a net loss of $6,243,231 and $18,710,407, respectively. For the three and nine months ended September 30, 2020, the Company reported a net income (loss) of $2,952,004 and $(20,676,352), respectively.

For the nine months ended September 30, 2021, the Company had cash flows used in operating activities of $22,720,933. The Company had net cash outflows for the nine months ended September 30, 2021 of $13,733,885.

The Company had working capital of $29,519,693 and $27,098,496 as of September 30, 2021, and December 31, 2020, respectively, reflecting an increase in working capital of $2,421,197 for the nine months ended September 30, 2021.

Current management forecasts and related assumptions support the view that the Company can adequately manage the operational needs of the business.

These unaudited condensed consolidated financial statements reflect all adjustments, which, in the opinion of management, are necessary for a fair presentation of the Company’s financial position and results of operations.

Basis of consolidation

These unaudited condensed consolidated financial statements include the accounts of the following entities wholly owned, or effectively controlled by the Company during the period ended September 30, 2021:


Name of entity		Place of incorporation
Goodness Growth Holdings, Inc.		British Columbia, CAN
Vireo Health, Inc.		Delaware, USA
Vireo Health of New York, LLC		New York, USA
Minnesota Medical Solutions, LLC		Minnesota, USA
Ohio Medical Solutions, Inc.		Delaware, USA
MaryMed, LLC		Maryland, USA
Vireo of Charm City, LLC		Maryland, USA
1776 Hemp, LLC		Delaware, USA
Vireo Health of Massachusetts, LLC		Delaware, USA
Mayflower Botanicals, Inc.		Massachusetts, USA
Elephant Head Farm, LLC		Arizona, USA
Retail Management Associates, LLC		Arizona, USA
Arizona Natural Remedies, Inc.		Arizona, USA
Vireo Health of New Mexico, LLC		Delaware, USA
Red Barn Growers, Inc.		New Mexico, USA
Resurgent Biosciences, Inc.		Delaware, USA
Vireo Health of Puerto Rico, LLC		Delaware, USA
Vireo Health de Puerto Rico, Inc.		Puerto Rico
XAAS Agro, Inc.		Puerto Rico
Vireo Health of Nevada 1, LLC		Nevada, USA
Verdant Grove, Inc.		Massachusetts, USA

The entities listed above are wholly owned or effectively controlled by the Company and have been formed or acquired to support the intended operations of the Company, and all intercompany transactions and balances have been eliminated in the Company's unaudited condensed consolidated financial statements.

Recently adopted accounting pronouncements

In January 2020, the FASB issued ASU 2020-01, Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) (“ASU 2020-01”), which is intended to clarify the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain forward contracts and purchased options

accounted for under Topic 815. ASU 2020-01 is effective for the Company beginning January 1, 2021. The adoption of the standard did not have a material impact on the Company's results of operations or cash flows.

Use of estimates and significant judgments

The preparation of the Company’s unaudited condensed consolidated financial statements requires management to make estimates, assumptions and judgments that affect the reported amounts of revenue, expenses, assets, liabilities, accompanying disclosures and the disclosure of contingent liabilities. These estimates and judgments are subject to change based on experience and new information which could result in outcomes that require a material adjustment to the carrying amounts of assets or liabilities affecting future periods. Estimates and judgments are assessed on an ongoing basis. Revisions to estimates are recognized prospectively.

Examples of key estimates in these unaudited condensed consolidated financial statements include cash flows and discount rates used in accounting for business combinations including contingent consideration, asset impairment including estimated future cash flows and fair values, the allowance for doubtful accounts receivable and trade receivables, inventory valuation adjustments that contemplate the market value of, and demand for inventory, estimated useful lives of property and equipment and intangible assets, valuation allowance on deferred income tax assets, determining the fair value of financial instruments, fair value of stock-based compensation, estimated variable consideration on contracts with customers, sales return estimates, the fair value of the convertible notes and equity component and the classification, incremental borrowing rates and lease terms applicable to lease contracts.

Financial statement areas that require significant judgments are as follows:

Assets held for sale and discontinued operations - The Company classifies non-current assets and disposal groups as held for sale if their carrying amounts will be recovered principally through a sale rather than through continuing use. Such non-current assets and disposal groups classified as held for sale are measured at the lower of their carrying amount and their fair value less cost to sell. Costs to sell are the incremental costs directly attributable to the sale, excluding finance costs and income tax expense.

The criteria for held for sale classification is regarded as met only when the sale is highly probable and the asset or the disposal group is available for immediate sale in its present condition. Actions required to complete the sale should indicate that it is unlikely that significant changes to the sale will be made or that the sale will be withdrawn. Management must be committed to the sale expected within one year from the date of the classification.

A discontinued operation is a component of the Company that either has been abandoned, disposed of, or is classified as held for sale, and: (i) disposal group is a component of an entity (or group of components); (ii) component of an entity (or group of components) meets the held for sale criteria, is disposed of by sale, or is disposed of other than by sale; (iii) component of an entity (or group of components) represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. A component of the Company comprises an operation and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the Company. During the year ended December 31, 2020, the Company completed divestitures of four subsidiaries, further described in Note 3. None of these divestitures represent a strategic shift that has or will have a major effect on an entity’s operations and financial results, and as such, none of these divestitures are considered a discontinued operation.

Asset impairment – Asset impairment tests require the allocation of assets to asset groups, where appropriate, which requires significant judgment and interpretation with respect to the integration between the assets and shared resources. Asset impairment tests require the determination of whether there is an indication of impairment. The assessment of whether an indication of impairment exists is performed at the end of each reporting period and requires the application of judgment, historical experience, and external and internal sources of information.

Leases – The Company applies judgment in determining whether a contract contains a lease and if a lease is classified as an operating lease or a finance lease. The Company determines the lease term as the non-cancellable term of the lease, which may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

The Company has several lease contracts that include extension and termination options. The Company applies judgment in evaluating whether it is reasonably certain whether or not to exercise the option to renew or terminate the lease. That is, it considers all relevant factors that create an economic incentive for it to exercise either the renewal or termination. After the commencement date, the Company reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise or not to exercise the option to renew or to terminate (e.g., construction of significant leasehold improvements or significant customization to the leased asset).

The Company also applies judgment in allocating the consideration in a contract between lease and non-lease components. It considers whether the Company can benefit from the right-of-use asset either on its own or together with other resources and whether the asset is highly dependent on or highly interrelated with another right-of-use asset.

Foreign currency

These financial statements are presented in the United States dollar (“USD”), which is the Company’s reporting currency. The functional currency of the Company and its subsidiaries, as determined by management, is the United States (“US”) dollar.

Net loss per share

Basic net loss per share is computed by dividing reported net loss by the weighted average number of common shares outstanding for the reported period. Diluted net loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock of the Company during the reporting period. Diluted net loss per share is computed by dividing net loss by the sum of the weighted average number of common shares and the number of potential dilutive common share equivalents outstanding during the period. Potential dilutive common share equivalents consist of the incremental common shares issuable upon the exercise of vested share options and the incremental shares issuable upon conversion of the convertible notes. Potential dilutive common share equivalents consist of stock options, warrants, and convertible notes.

In computing diluted earnings per share, common share equivalents are not considered in periods in which a net loss is reported, as the inclusion of the common share equivalents would be anti-dilutive. The Company recorded a net loss for the three month period ended September 30, 2021, and the nine month periods ended September 30, 2021 and 2020, presented in these financial statements, and as such there is no difference between the Company’s basic and diluted net loss per share for these periods. The Company recorded net income for the three month period ended September 30, 2020. The dilutive effect of the outstanding stock options, warrants, and convertible securities for the three months ended September 30, 2020, on net income and weighted average shares outstanding was $164,032 and 13,646,075, respectively, resulting in a diluted net income per share of $0.03.

The anti-dilutive shares outstanding for the nine month periods ending September 30, 2021 and 2020 were as follows:


	September 30,
	2021	2020
Stock options	23,610,886	24,651,391
Warrants	4,395,949	30,817,992
Convertible notes	—	211,765
Total	28,006,835	55,681,148

Segment Information

Accounting Standards Codification ("ASC") 280, Segment Reporting, establishes disclosure requirements relating to operating segments in annual and interim financial statements. Operating segments are defined as components of an enterprise about which separate financial information is available that is regularly evaluated by the chief operating decision maker in deciding how to allocate resources to the segment and assess its performance. The Company operates in one business segment, namely as the cannabis segment cultivates, processes and distributes medical and adult-use cannabis

products in a variety of formats, as well as related accessories. The Company’s Chief Executive Officer is the Company’s chief operating decision maker.

Cash and cash equivalents

Cash and cash equivalents is comprised of cash and highly liquid investments that are readily convertible into known amounts of cash with original maturities of three months or less.

The Company has no cash equivalents for the years presented.

Business combinations and goodwill

The Company accounts for business combinations using the acquisition method in accordance with ASC 805, Business Combinations, which requires recognition of assets acquired and liabilities assumed, including contingent assets and liabilities, at their respective fair values on the date of acquisition. Any excess of the purchase consideration over the net fair value of tangible and identified intangible assets acquired less liabilities assumed is recorded as goodwill. The costs of business acquisitions, including fees for accounting, legal, professional consulting and valuation specialists, are expensed as incurred within acquisition-related (income) expenses, net. Purchase price allocations may be preliminary and, during the measurement period not to exceed one year from the date of acquisition, changes in assumptions and estimates that result in adjustments to the fair value of assets acquired and liabilities assumed are recorded in the period the adjustments are determined.

The estimated fair value of acquired assets and assumed liabilities are determined primarily using a discounted cash flow approach, with estimated cash flows discounted at a rate that the Company believes a market participant would determine to be commensurate with the inherent risks associated with the asset and related estimated cash flow streams.

Fair value measurements

The carrying value of the Company’s accounts receivable, accounts payable, accrued expenses and other current liabilities approximate their fair value due to their short-term nature, and the carrying value of long-term loans and convertible debt approximates fair value as they bear a market rate of interest.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date.

Inventory

Inventory is comprised of work-in-progress, finished goods and non-cannabis. Inventory includes plants, harvested cannabis (bud and trim) in progress, cannabis oil in progress, finished goods, accessories, and packaging materials.

Inventory cost includes pre-harvest, post-harvest, shipment and fulfillment, as well as related accessories. Pre-harvest costs include labor and direct materials to grow cannabis, which includes water, electricity, nutrients, integrated pest management, growing supplies and allocated overhead. Post-harvest costs include costs associated with drying, trimming, blending, extraction, purification, quality testing and allocated overhead. Shipment and fulfillment costs include the costs of packaging, labelling, courier services and allocated overhead.

Inventory is stated at the lower of cost or net realizable value, determined using weighted average cost. Net realizable value is defined as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. At the end of each reporting period, the Company performs an assessment of inventory and records write-downs for excess and obsolete inventories based on the Company’s estimated forecast of product demand, production requirements, market conditions, regulatory environment, and spoilage. Actual inventory

losses may differ from management’s estimates and such differences could be material to the Company’s balance sheets, statements of net loss and comprehensive loss and statements of cash flows.

Property and equipment

Property and equipment are recorded at cost net of accumulated depreciation and impairment, if any. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful life of buildings and improvements ranges from five to fifteen years, the estimated useful life of property and equipment, other than buildings, ranges from three to ten years. Land is not depreciated. Leasehold improvements, included in buildings and improvements, are depreciated over the lesser of the asset’s estimated useful life or the remaining lease term. The estimated useful life of right of use assets relating to operating and finance leases ranges from one to sixty-four years.

When assets are retired or disposed of, the cost and accumulated depreciation are removed from the respective accounts and any related gain or loss is recognized. Maintenance and repairs are charged to expenses as incurred. Significant expenditures, which extend the useful lives of assets or increase productivity, are capitalized. When significant parts of an item of property and equipment have different useful lives, they are accounted for as separate items or components of property and equipment.

Construction-in-process includes construction progress payments, deposits, engineering costs, interest expense on long-term construction projects and other costs directly related to the construction of the facilities. Expenditures are capitalized during the construction period and construction in progress is transferred to the relevant class of property and equipment when the assets are available for use, at which point the depreciation of the asset commences.

The estimated useful lives are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis.

Capitalization of interest

Interest incurred relating to the construction or expansion of facilities is capitalized to the construction in progress. The Company ceases the capitalization of interest when construction activities are substantially complete and the facility is available for commercial use.

Intangible assets

Intangible assets include intangible assets acquired as part of business combinations, asset acquisitions and other business transactions. The Company records intangible assets at cost, net of accumulated amortization and accumulated impairment losses, if any. Cost is measured based on the fair values of cash consideration paid and equity interests issued. The cost of an intangible asset acquired is its acquisition date fair value.

Amortization of definite life intangible assets is calculated on a straight-line basis over the estimated useful lives of the assets as follows:


Licenses		4-20 years

When there is no foreseeable limit on the period of time over which an intangible asset is expected to contribute to the cash flows of the Company, an intangible asset is determined to have an indefinite life. Indefinite life intangible assets are not amortized but tested for impairment annually or more frequently when indicators of impairment exist. If the carrying value of an individual indefinite-lived intangible asset exceeds its fair value, such individual indefinite-life intangible asset is impaired by the amount of the excess.

The estimated useful lives are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis.

Impairment of long-lived assets

The Company reviews long-lived assets, including property and equipment and definite life intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. In order to determine if assets have been impaired, assets are grouped and tested at the lowest level for which identifiable independent cash flows are available (“asset group”). An impairment loss is recognized when the sum of projected undiscounted cash flows is less than the carrying value of the asset group. The measurement of the impairment loss to be recognized is based on the difference between the fair value and the carrying value of the asset group. Fair value can be determined using a market approach, income approach or cost approach. The reversal of impairment losses is prohibited.

Impairment of goodwill and indefinite life intangible assets

Goodwill and indefinite life intangible assets are tested for impairment annually, or more frequently when events or circumstances indicate that impairment may have occurred. As part of the impairment evaluation, the Company may elect to perform an assessment of qualitative factors. If this qualitative assessment indicates that it is more likely than not that the fair value of the indefinite-lived intangible asset or the reporting unit (for goodwill) is less than its carrying value, a quantitative impairment test to compare the fair value to the carrying value is performed. An impairment charge is recorded if the carrying value exceeds the fair value.

Leases

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets and right-of-use liabilities (current and non-current) in the balance sheets. Finance lease ROU assets are included in property and equipment, net and ROU liabilities (current and non-current) in the balance sheets.

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets are classified as a finance lease or an operating lease. A finance lease is a lease in which 1) ownership of the property transfers to the lessee by the end of the lease term; 2) the lease grants the lessee an option to purchase the underlying asset that the lessee is reasonably certain to exercise; 3) the lease is for a major part of the remaining economic life of the underlying asset; 4) The present value of the sum of the lease payments and any residual value guaranteed by the lessee that is not already included in the lease payments equals or exceeds substantially all of the fair value; or 5) the underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term. The Company classifies a lease as an operating lease when it does not meet any one of these criteria.

ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the incremental borrowing rate is used based on the information available at commencement date in determining the present value of lease payments. The Company uses the implicit rate when readily determinable. The ROU assets also include any lease payments made and excludes lease incentives. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

For finance leases, lease expenses are the sum of interest on the lease obligations and amortization of the ROU assets, resulting in a front-loaded expense pattern. ROU assets are amortized based on the lesser of the lease term and the useful life of the leased asset according to the property and equipment accounting policy. If ownership of the ROU assets transfers to the Company at the end of the lease term or if the Company is reasonably certain to exercise a purchase option, amortization is calculated using the estimated useful life of the leased asset, according to the property and equipment accounting policy. For operating leases, the lease expenses are generally recognized on a straight-line basis over the lease term and recorded to general and administrative expenses in the statements of net loss and comprehensive loss.

The Company has elected to apply the practical expedient, for each class of underlying asset, except real estate leases, to not separate non-lease components from the associated lease components of the lessee’s contract and account for both components as a single lease component.

The Company has elected not to recognize ROU assets and lease liabilities for short-term leases that have a lease term of 12 months or less that do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise. Short-term leases include real estate and vehicles and are not significant in comparison to the Company’s overall lease portfolio. The Company continues to recognize the lease payments associated with these leases as expenses on a straight-line basis over the lease term.

Convertible notes

The Company accounts for its convertible notes with a cash conversion feature in accordance with ASC 470-20, Debt with Conversion and Other Options (“ASC 470-20”), which requires the liability and equity components of convertible debt instruments that may be settled in cash upon conversion, including partial cash settlement, to be separately accounted for in a manner that reflects the issuer’s nonconvertible debt borrowing rate. The initial proceeds from the sale of convertible notes are allocated between a liability component and an equity component in a manner that reflects interest expense at the rate of similar nonconvertible debt that could have been issued at such time. The equity component represents the excess initial proceeds received over the fair value of the liability component of the notes as of the date of issuance. The resulting debt discount is amortized over the period during which the convertible notes are expected to be outstanding as additional non-cash interest expenses.

Upon repurchase of convertible debt instruments, ASC 470-20 requires the issuer to allocate total settlement consideration, inclusive of transaction costs, amongst the liability and equity components of the instrument based on the fair value of the liability component immediately prior to repurchase. The difference between the settlement consideration allocated to the liability component and the net carrying value of the liability component, including unamortized debt issuance costs, would be recognized as gain (loss) on extinguishment of debt in the statements of net loss and comprehensive loss. The remaining settlement consideration allocated to the equity component would be recognized as a reduction of additional paid-in capital in the balance sheets.

Revenue recognition

Revenue is recognized when control of the promised goods or services, through performance obligations by the Company, is transferred to the customer in an amount that reflects the consideration it expects to be entitled to in exchange for the performance obligations.

The Company generates substantially all its revenue from the direct sale of cannabis products through contracts with medical and recreational customers. Cannabis products are sold through various distribution channels. Revenue is recognized when the control of the goods is transferred to the customer, which occurs at a point in time, typically upon delivery to or receipt by the customer, depending on shipping terms.

Sales taxes collected from customers are remitted to the appropriate taxing jurisdictions and are excluded from sales revenue as the Company considers itself a pass-through conduit for collecting and remitting sales taxes. Excise duties that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer are included in revenue. Freight revenues on all product sales, when applicable, are also recognized, on a consistent manner, at a point in time. The term between invoicing and when payment is due is not significant and the period between when the entity transfers the promised good or service to the customer and when the customer pays for that good or service is one year or less.

Contract liabilities

A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration from the customer. If a customer pays consideration before the Company transfers goods or services, a contract liability is recognized when the payment is made. Contract liabilities are recognized as revenue when the Company performs under the contract.

The Company considers whether there are other promises in the contracts that are separate performance obligations to which a portion of the transaction price needs to be allocated. In determining the transaction price for the sale of goods, the Company considers the effects of variable consideration and the existence of significant financing components (if any).

(i)

Variable consideration

Some contracts for the sale of goods may provide customers with a right of return, volume discount, bonuses for volume/quality achievement, or sales allowance. In addition, the Company may provide in certain circumstances, a retrospective price reduction to a customer based primarily on inventory movement. These items give rise to variable consideration. The Company uses the expected value method to estimate the variable consideration because this method best predicts the amount of variable consideration to which the Company will be entitled. The Company uses historical evidence, current information and forecasts to estimate the variable consideration. The requirements in ASC 606 on constraining estimates of variable consideration are applied to determine the amount of variable consideration that can be included in the transaction price. The Company reduces revenue and recognizes a contract liability equal to the amount expected to be refunded to the customer in the form of a future rebate or credit for a retrospective price reduction, representing its obligation to return the customer’s consideration. The estimate is updated at each reporting period.

(ii)

Significant financing component

The Company may receive short-term advances from its customers. Using the practical expedient in ASC 606, the Company does not adjust the promised amount of consideration for the effects of a significant financing component if the Company expects, at contract inception, that the period between when the Company transfers a promised good to a customer and when the customer pays for that good or service will be one year or less. The Company has not, nor expects to receive long-term advances from customers.

(iii)

Contract balance

Contract assets

A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If the Company performs by transferring goods to a customer before the customer pays consideration or before payment is due, a contract asset is recognized for the earned consideration.

Accounts receivable

A receivable represents the Company’s right to an amount of consideration that is unconditional (i.e., only the passage of time is required before payment of the consideration).

Cost of sales

Cost of sales represents costs directly related to manufacturing and distribution of the Company’s products. Primary costs include raw materials, packaging, direct labor, overhead, shipping and handling and the depreciation of manufacturing equipment and production facilities. Manufacturing overhead and related expenses include salaries, wages, employee benefits, utilities, maintenance and property taxes. Cost of sales also includes inventory valuation adjustments. The Company recognizes the cost of sales as the associated revenues are recognized.

Stock-based compensation

The Company measures and recognizes compensation expense for stock options to employees and non-employees on a straight-line basis over the vesting period based on their grant date fair values. Prior to the adoption of ASU 2018-07 on January 1, 2019, the fair value of stock options to non-employees were re-measured at each reporting date until one of either of the counterparty’s commitment to perform is established or until the performance is complete. The Company estimates the fair value of stock options on the date of grant using the Black-Scholes option pricing model. Determining the estimated fair value of at the grant date requires judgment in determining the appropriate valuation model and

assumptions, including the fair value of subordinated voting shares on the grant date, risk-free rate, volatility rate, annual dividend yield and the expected term. The volatility rate is based on historical volatilities of public companies operating in a similar industry to the Company.

For stock options granted, the fair value of common stock at the date of grant was determined by the Board of Directors with assistance from third-party valuation specialists. The Company estimates forfeitures at the time of grant and revises these estimates in subsequent periods if actual forfeitures differ from those estimates.

Fully vested, non-forfeitable equity instruments issued to parties other than employees are measured on the date they are issued where there is no specific performance required by the grantee to retain those equity instruments. Stock-based payment transactions with non-employees are measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. Where fully vested, non-forfeitable equity instruments are granted to parties other than employees in exchange for notes or financing receivable, the note or receivable is presented in additional paid-in capital on the balance sheets.

Income taxes

The Company uses the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Management assesses the likelihood that the resulting deferred tax assets will be realized. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized.

The Company recognizes uncertain income tax positions at the largest amount that is more likely than not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Changes in recognition or measurement are reflected in the period in which judgment occurs.

New accounting pronouncements not yet adopted

The Company has not adopted any new or amended standards during the period ended September 30, 2021.

3. Business Combinations and Dispositions

Dispositions

On June 22, 2020, the Company reached a definitive agreement with Jushi Inc, a subsidiary of Jushi Holdings, Inc. (“Jushi”), to divest all the equity in its subsidiary company, Pennsylvania Medical Solutions, LLC (“PAMS”). On August 11, 2020, the Company completed the sale of its equity in PAMS to Jushi, for consideration of $20.45 million consisting of $16.7 million in cash, and $3.75 million in the form of a four-year note with an 8 percent coupon rate payable quarterly. As part of this transaction, the Company was relieved of $13.3 million of Right of Use Liabilities. Consideration received exceeded PAMS net assets at the time of sale, resulting in a gain of $16,884,173 which was recorded in the statement of loss and comprehensive loss for the nine months ended September 30, 2020.

In July of 2020, the Company divested all the equity in its subsidiary company, Midwest Hemp Research, LLC, to the CEO of the Company. Prior to the disposition, the Company had $50,000 in outstanding convertible notes associated with the initial acquisition of Midwest Hemp, and had recorded an intangible asset of $50,000 on the balance sheet. Upon divestiture these outstanding convertible notes were cancelled, and the intangible asset was disposed of, resulting in no gain or loss. Per the terms of the agreement, all remaining assets and liabilities associated with Midwest Hemp Research reverted back to the Company prior to the exchange of ownership.

On October 1, 2020, the Company caused three of its executives to enter into a definitive agreement with a third party to sell all of the assets and liabilities of its affiliated company, Ohio Medical Solutions, LLC (“OMS”), which was owned by such executives, for $1,150,000 in cash. A loss on assets held for sale of $446,544 related to OMS is included in the

statement of loss and comprehensive loss for the three and nine month periods ended September 30, 2020, given net assets as of September 30, 2020, exceeded the agreed upon purchase price of $1.15 million. On March 31, 2021, the sale of OMS was completed. As part of this transaction, the Company transferred assets and liabilities with a net book value of $712,893. Consideration received exceeded OMS’s net assets at the time of sale, resulting in a gain of $437,107 which was recorded in the unaudted condensed consolidated statement of loss and comprehensive loss for the nine months ended September 30, 2021.

Assets held for sale

On November 1, 2021, subsidiaries and an affiliate of the Company entered into a Purchase Agreement with subsidiaries and an affiliate of Copperstate Farms, LLC (“Copperstate”) pursuant to which the Company will sell its Phoenix dispensary and cultivation licenses, dispensary inventory and equipment, dispensary lease, and all dispensary revenue-producing contracts to Copperstate for $15,000,010 in cash (the “Transaction”). The Company expects the Transaction to close during the fourth quarter, subject to regulatory approval and customary closing conditions.

Certain assets and liabilities relating to the Transaction have been classified as “held for sale.” The carrying value of assets held for sale, net of liabilities to be assumed by Copperstate, was less than the agreed upon purchase price of $15,000,010. As such, no allowance for loss on assets held for sale was recorded as of September 30, 2021.

Assets and liabilities held for sale relating to are as follows:


Assets held for sale
Property and equipment	$	75,495
Operating lease, right-of-use-asset		114,936
Intangible assets, net		5,553,333
Goodwill		2,948,655
Total assets held for sale	$	8,692,419

Liabilities held for sale
Right of Use Liability		116,803
	$	116,803

Asset Acquisitions

Acquisition of MJ Distributing C201, LLC and MJ Distributing P132, LLC

On April 10, 2019, the Company entered into a definitive agreement to acquire 100% of the membership interests in MJ Distributing C201, LLC and MJ Distributing P132, LLC (“MJ Distributing”) which currently hold licenses to cultivate and distribute, respectively, medical and adult-use cannabis in the state of Nevada. The purpose of this acquisition was to acquire a medical marijuana license in the state of Nevada. The acquisition was financed with cash on hand and stock.

The acquisition of MJ Distributing was completed on January 5, 2021. As part of the closing of the acquisition the restricted cash of $1,592,500 was transferred to the sellers, the convertible notes in escrow were cancelled, and the Company issued 1,050,000 subordinate voting shares to the sellers. Management determined the total consideration paid of $1,592,500 in restricted cash, $1,564,500 associated with the fair value of the subordinate voting shares issued, and $28,136 of incurred acquisition costs, was equal to the fair value of the intangible asset acquired, or $3,185,136. The related operating results are included in the accompanying unaudited condensed consolidated statements of operations, changes in shareholders’ equity, and statement of cash flows commencing from the date of acquisition.

4. Fair Value Measurements

The Company complies with ASC 820, Fair Value Measurements, for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the asset or liability, and includes situations where there is little, if any, market activity for the asset or liability.

The following tables present information about the Company’s assets that are measured at fair value on a recurring basis as of September 30, 2021, and December 31, 2020, indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value:


	Quoted prices in		Other		Significant
	active markets for		observable		unobservable
	identical assets		inputs		inputs
	(Level 1)		(Level 2)		(Level 3)		Total
September 30, 2021
Cash	$	11,779,295	$	—	$	—	$	11,779,295
Restricted cash		—		—		—		—
Total assets	$	11,779,295	$	—	$	—	$	11,779,295

Warrant liability		—		—		3,078,694		3,078,694
Total liabilities	$	—	$	—	$	3,078,694	$	3,078,694

December 31, 2020
Cash		25,513,180		—		—		25,513,180
Restricted cash		1,592,500		—		—		1,592,500
Total assets	$	27,105,680	$	—	$	—	$	27,105,680

The following table reflects the activity for the Company’s warrant derivative liability for the private placement measured at fair value using Level 3 inputs:


	Warrant Liability
Balance as of December 31, 2020		—
Issuance	$	5,395,759
Adjustments to estimated fair value		(2,317,065)
Balance as of September 30, 2021	$	3,078,694

The resulting gain upon revaluation of $2,317,065 for the nine month period ended September 30, 2021, is reflected in the unaudited condensed consolidated statement of net loss and comprehensive loss.

Items measured at fair value on a non-recurring basis

The Company's non-financial assets, such as prepayments and other current assets, long lived assets, including property and equipment and intangible assets, are measured at fair value when there is an indicator of impairment and are recorded at fair value only when an impairment charge is recognized. In connection with an evaluation of such non-financial assets during the year ended December 31, 2020, the fair values of intangible assets and goodwill were concluded to exceed their carrying values. As a result, the Company did not record impairment charges during the year ended December 31, 2020. No additional impairment was determined necessary as of September 30, 2021.

The estimated fair value of cash, accounts receivable, net, accounts payable, accrued expenses, and other current liabilities at September 30, 2021 and December 31, 2020 approximate their carrying amount due to short term nature of these instruments.

5. Accounts Receivable

Trade receivables are comprised of the following items:


	September 30,		December 31,
	2021		2020
Trade receivable	$	932,409	$	486,807
Tenant improvements receivable		—		127,160
Other		42,796		83,027
Total	$	975,205	$	696,994

Included in the accounts receivable, net balance at September 30, 2021 is an allowance for doubtful accounts of $189,467 and $132,490 at December 31, 2020.

6. Notes Receivable

As of September 30, 2021, the Company had a total of $3,769,954 in notes receivable and $4,043,700 at December 31, 2020. The September 30, 2021, and December 31, 2020, balances are comprised primarily of the $3,750,000 four-year note with an 8 percent coupon rate payable quarterly obtained as part of the disposition of Pennsylvania Medical Solutions in August of 2020.

7. Inventory

Inventory is comprised of the following items net of inventory reserves of $218,000 and $290,000 as of September 30, 2021, and December 31, 2020, respectively:


	September 30,		December 31,
	2021		2020
Work-in-progress	$	14,723,585	$	8,317,502
Finished goods		4,831,024		3,980,900
Non-cannabis inventory		587,342		346,493
Total	$	20,141,951	$	12,644,895

Inventory is written down for any obsolescence, spoilage and excess inventory or when the net realizable value of inventory is less than the carrying value. Inventory valuation adjustments included in cost of sales on the statements of net loss and comprehensive loss is comprised of the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Work-in-progress	$	278,000	$	—	$	278,000	$	—
Finished goods		73,000		151,328		186,000		484,570
Non-cannabis inventory		—		—		—		—
Total	$	351,000	$	151,328	$	464,000	$	484,570

During the three and nine months ended September 30, 2021 and 2020, the Company recorded write downs to net realizable value and adjustments to the inventory reserve. Based on the market sales prices relative to the cost to produce certain inventories net realizable value was less than the carrying value of inventory.

8. Prepayments and other current assets

Prepayments and other current assets are comprised of the following items:


	September 30,		December 31,
	2021		2020
Prepaid Insurance	$	1,505,445	$	921,600
Other Prepaid Expenses		1,640,045		630,678
Total	$	3,145,490	$	1,552,278

9. Deferred Acquisition Costs

As of September 30, 2021, the Company had a total of $0 in deferred acquisition costs. The December 31, 2020 balance of $28,136 relating to the acquisition of MJ Distributing was released upon the closing of the acquisition on January 5, 2021 (Note 3).

10. Property and Equipment, Net

Property and equipment, net consisted of the following:


	September 30,		December 31,
	2021		2020
Land	$	1,366,650	$	1,309,949
Buildings and leasehold improvements		15,286,180		7,280,665
Furniture and equipment		7,700,007		4,635,602
Software		221,540		221,540
Vehicles		513,135		379,852
Construction-in-progress		11,159,996		9,276,852
Right of use asset under finance lease		70,713,084		12,351,838
		106,960,592		35,456,298
Less: accumulated depreciation		(7,006,282)		(4,890,039)
Total	$	99,954,310	$	30,566,259

For the nine months ended September 30, 2021 and 2020, total depreciation on property and equipment was $2,194,465 and $2,018,006, respectively. For the nine months ended September 30, 2021 and 2020, accumulated amortization of the right of use asset under finance lease amounted to $2,258,732 and $1,598,128, respectively. The right of use asset under finance lease of $70,713,084 consists of leased processing and cultivation premises. The Company capitalized into inventory $1,678,558 and $1,757,281 relating to depreciation associated with manufacturing equipment and production facilities for the nine months ended September 30, 2021 and 2020, respectively. The capitalized depreciation costs associated are added to inventory and expensed through Cost of Sales Product Cost on the unaudited condensed consolidated statements of net loss and comprehensive loss.

For the nine months ended September 30, 2021 and 2020, total capitalized interest related to the construction or expansion of facilities financed by the Credit Facility (Note 15) was $521,178 and $0, respectively.

11. Leases

Components of lease expenses are listed below:


	September 30,		September 30,
	2021		2020
Finance lease cost
Amortization of ROU assets	$	692,686	$	1,108,235
Interest on lease liabilities		2,631,030		4,103,908
Operating lease expense		1,946,009		1,553,158
Total lease expenses	$	5,269,725	$	6,765,301

Future minimum lease payments (principal and interest) on the leases are as follows:


	Operating Leases		Finance Leases
	September 30, 2021		September 30, 2021		Total
2021	$	612,193	$	1,023,262	$	1,635,455
2022		2,471,751		7,383,555		9,855,306
2023		2,372,611		10,419,836		12,792,447
2024		2,068,139		10,466,735		12,534,874
2025		1,830,420		10,710,227		12,540,647
Thereafter		3,995,745		216,469,417		220,465,162
Total minimum lease payments	$	13,350,859	$	256,473,032	$	269,823,891
Less discount to net present value						(189,813,692)
Present value of lease liability					$	80,010,199

The Company has entered into various lease agreements for the use of buildings used in production and retail sales of cannabis products.

On September 24, 2021, the Company signed a third amendment to the existing lease agreements for the cultivation and processing facilities in New York. Under the terms of the amendment, the term of the lease was extended to September 23, 2041, and provides for additional tenant improvements up to $49,435,000. The amended agreement for the cultivation and processing facility in New York requires additional monthly base rent payments of $492,625.

Supplemental cash flow information related to leases:


	September 30,
	2021
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash flows from finance leases	$	1,008,584
Non-cash additions to ROU assets		59,665,237
Amortization of operating leases		934,934

Other information about lease amounts recognized in the financial statements:


	September 30,
	2021
Weighted-average remaining lease term (years) – operating leases	5.85
Weighted-average remaining lease term (years) – finance leases	19.85
Weighted-average discount rate – operating leases	15.00	%
Weighted-average discount rate – finance leases	15.33	%

12. Goodwill

The following table shows the change in carrying amount of goodwill:


Goodwill - January 1, 2020	$	3,132,491
Transfer to held for sale		(2,948,655)
Goodwill - December 31, 2020 and September 30, 2021	$	183,836

Goodwill is tested for impairment annually or more frequently if indicators of impairment exist or if a decision is made to dispose of business. The valuation date for the Company’s annual impairment testing is December 31. On this date the Company performed a Step 1 goodwill impairment analysis. No indicators of impairment exist as of September 30, 2021.

13. Intangibles

During the nine months ended September 30, 2021, the Company acquired cannabis licenses in Nevada. The fair value allocated to a license is depreciated over its expected useful life, which is estimated to be 15 years.

Intangible assets are comprised of the following items:


	Licenses		Royalty Asset		Total
Balance, December 31, 2019	$	9,001,237	$	—	$	9,001,237
Additions (Note 3)		—		68,276		68,276
Dispostions		(45,000)		—		(45,000)
Amortization		(615,094)		—		(615,094)
Balance, December 31, 2020	$	8,341,143	$	68,276	$	8,409,419
Additions (Note 3)		3,185,136		—		3,185,136
Transfer to held for sale (Note 3)		(5,553,333)		—		(5,553,333)
Amortization		(619,327)		—		(619,327)
Balance, September 30, 2021	$	5,353,619	$	68,276	$	5,421,895

Amortization expense for intangibles was $206,442 and $619,327 during the three and nine months ended September 30, 2021, respectively, and $153,356 and $461,737 during the three and nine months ending September 30, 2020, respectively. Amortization expense is recorded in operating expenses on the unaudited condensed consolidated statements of net loss and comprehensive loss.

The Company estimates that amortization expense will be $825,772 per year for the next five fiscal years.

14. Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities are comprised of the following items:


	September 30,		December 31,
	2021		2020
Accounts payable – trade	$	1,760,994	$	900,929
Accrued Expenses		3,620,793		4,814,131
Taxes payable		2,998,823		7,227,245
Insurance payable		720,601		292,276
Contract liability		424,448		242,722
Total accounts payable and accrued liabilities	$	9,525,659	$	13,477,303

15. Long-Term Debt

During the year ended December 31, 2017, the Company signed a promissory note payable in the amount of $1,010,000. The note bears interest at a rate of 15% per annum with interest payments required on a monthly basis. Effective

November 13, 2019, the Company’s promissory note payable in the amount of $1,010,000 was modified to increase the amount payable to $1,110,000 and extend the maturity date to December 31, 2021.

On March 25, 2021, the Company entered into a credit agreement for a senior secured delayed draw term loan with an aggregate principal amount of up to $46,000,000 (the “Credit Facility”). Net of fees and closing costs of $1,971,705, the Company received $24,028,295 of the first tranche on March 25, 2021. Additionally, the Company incurred fees and closing costs of $986,035 which were paid in cash. Obligations under the Credit Facility are secured by substantially all the assets of the borrowers. The Credit Facility and related documents also provide for the payment of certain fees to the agent, including a closing fee equal to 3% of each loan advanced, and a 3.25% closing fee to the broker. The unpaid principal amounts outstanding under the Credit Facility bear interest at a rate of (a) 13.625% per annum payable monthly in cash, and (b) 2.75% per annum paid in kind interest payable monthly. The Credit Facility matures on March 31, 2024.

On March 25, 2021, in connection with closing the Credit Facility, Goodness Growth issued (a) five year warrants to the agent and each lender to purchase an aggregate of 2,803,984 subordinate voting shares at an exercise price of C$3.50 per share, and (b) a five year warrant to the broker to purchase 233,665 subordinate voting shares at an exercise price of C$3.50 per share. Each warrant provides customary anti-dilution provisions. The fair value of these warrants at the time of issuance was $5,395,759 (Note 16) which is treated as a deferred financing cost.

All deferred financing costs are treated as a contra-liability, to be netted against the outstanding loan balance of $26,000,000 and amortized over the remaining life of the loan.

The following table shows a summary of the Company’s long-term debt:


	September 30,		December 31,
	2021		2020
Beginning of year	$	1,110,000	$	1,110,000
Proceeds		26,000,000		—
Deferred financing costs		(8,353,499)		—
PIK interest		372,461		—
Amortization of deferred financing costs		1,392,250		—
End of period		20,521,212		1,110,000
Less: Current portion		(1,110,000)		(1,110,000)
Total long-term debt	$	19,411,212	$	—

16. Derivative Liability

On March 25, 2021, in connection with closing the Credit Facility (Note 15), Goodness Growth issued (a) five year warrants to the agent to and each lender to purchase an aggregate of 2,803,984 subordinate voting shares at an exercise price of C$3.50 per share, and (b) a five year warrant to the broker to purchase 233,665 subordinate voting shares at an exercise price of C$3.50 per share.

Because of the Canadian denominated exercise price, these warrants do not qualify to be classified within equity and are therefore classified as derivative liabilities at fair value through profit or loss. On March 25, 2021, the warrants were valued using the Black Scholes option pricing model at $5,395,759 using the following assumptions: Share Price: $2.45; Exercise Price: $2.78; Expected Life: 5 years; Annualized Volatility: 100%; Dividend yield: 0%; Discount Rate: 0.83%; C$ Exchange Rate: 1.258.

On September 30, 2021, the warrants were subsequently revalued using the Black Scholes option pricing model at $3,078,694 using the following assumptions: Share Price: $1.60; Exercise Price: $2.76; Expected Life: 4.48 years; Annualized Volatility: 100%; Dividend yield: 0%; Discount Rate: 0.98%; C$ Exchange Rate: 1.268. The resulting gain upon revaluation of $627,165 and $2,317,065 for the three, and nine-month periods ended September 30, 2021, is reflected in the unaudited condensed consolidated statements of net loss and comprehensive loss.

On March 9, 2020, the Company closed the first tranche of a non-brokered private placement and issued 13,651,574 units at a price of C$ 0.77 per Unit (Note 18). Each unit is comprised of one subordinate voting share of the Company and one subordinate voting share purchase warrant.

Because of the Canadian denominated exercise price, these warrants do not qualify to be classified within equity and are therefore classified as derivative liabilities at fair value through profit or loss. On March 9, 2020, the warrants were valued using the Black Scholes option pricing model at $3,555,030 using the following assumptions: Share Price: $0.52; Exercise Price: $0.70; Expected Life: 3 years; Annualized Volatility: 90%; Dividend yield: 0%; Discount Rate: 0.38%; C$ Exchange Rate: 1.37.

On September 30, 2020, the warrants were subsequently revalued using the Black Scholes option pricing model at $8,587,567 using the following assumptions: Share Price: $1.04; Exercise Price: $0.72; Expected Life: 2.44 years; Annualized Volatility: 90%; Dividend yield: 0%; Discount Rate: 0.13%; C$ Exchange Rate: 1.33. The resulting loss upon revaluation of $4,066,335 and $5,032,537 for the three, and nine-month periods ended September 30, 2020, respectively, is reflected in the unaudited condensed consolidated statements of net loss and comprehensive loss.

17. Convertible Notes

On June 17, 2019, the Company issued a convertible note with a face value of $900,000 in connection with the XAAS Argo, Inc. acquisition. This note was repaid in full during the nine month period ended September 30, 2021.

The following table sets forth the net carrying amount of the convertible notes:


	September 30, 2021		December 31, 2020
5.00% convertible notes	$	—	$	900,000
Net carrying amount	$	—	$	900,000

18. Stockholders’ Equity

The Company’s certificate of incorporation authorized the Company to issue the following classes of shares with the following par value and voting rights as of September 30, 2021 The liquidation and dividend rights are identical among shares equally in the Company’s earnings and losses on an as converted basis.


	Par Value	Authorized	Voting Rights
Subordinate Voting Share (“SVS”)	—	Unlimited	1 vote for each share
Multiple Voting Share (“MVS”)	—	Unlimited	100 votes for each share
Super Voting Share	—	Unlimited	1,000 votes for each share

Subordinate Voting Shares

Holders of Subordinate Voting Shares are entitled to one vote in respect of each Subordinate Voting Share held.

Multiple Voting Shares

Holders of Multiple Voting Shares are entitled to one hundred votes for each Multiple Voting Share held.

Multiple Voting Shares each have the restricted right to convert to one hundred Subordinate Voting Shares subject to adjustments for certain customary corporate changes.

Super Voting Shares

Holders of Super Voting Shares are entitled to one thousand votes per Super Voting Share. Each Super Voting share is convertible into one Multiple Voting Share.

Shares Issued

During the nine months ended September 30, 2021, employee stock options were redeemed for 3,989,344 Subordinate Voting Shares. Proceeds from these transactions were $1,152,596.

On June 4, 2021, the Company issued 295,774 shares with a fair value of $686,196 to a third party for ongoing corporate advisory services. The fair value of the issued shares was recorded to stock-based compensation expense in the unaudited condensed consolidated statements of net loss and comprehensive loss for the three and nine month periods ended September 30, 2021.

On March 31, 2021, as part of a settlement and release of claims regarding a dispute over certain post-termination terms under his employment agreement, the Company issued 7,110,481 subordinate voting shares to its former Executive Chairman, Bruce Linton, upon a cashless exercise of 10 million warrants that had an exercise price of $1.02 per share and issued him 889,519 subordinate voting shares with a fair value of $1,627,820 pursuant to an exemption from registration under the Securities Act. The fair value of the 889,519 subordinate voting shares issued of $1,627,820 was recorded as stock-based compensation expense in the unaudited condensed consolidated statements of net loss and comprehensive loss for the three and nine months ended September 30, 2021. The Company did not receive any proceeds in connection with the warrant exercise or issuance of shares. The shares issued pursuant to the warrant exercise are free of trading restrictions; the additional 889,519 shares are subject to a holding period expiring on August 1, 2021. He was previously issued 15,000,000 warrants under his employment agreement and as part of the settlement, he surrendered all right, title, and interest in the remaining 5,000,000 warrants for cancellation.

On March 9, 2020, the Company closed the first tranche of a non-brokered private placement and issued 13,651,574 units at a price of C$ 0.77 per unit. Each unit is comprised of one Subordinate Voting Share and one subordinate voting share purchase warrant. Each warrant entitles the holder to purchase one Subordinate Voting Share for a period of three years from the date of issuance at an exercise price of C$ 0.96 per share. The Company has the right to force the holders of the warrants to exercise the warrants into subordinate voting shares if, prior to the maturity date, the five-trading-day volume weighted-average price of the subordinate voting shares equals or exceeds C$ 1.44. Proceeds from this transaction were $7,613,490 net of share issuance costs of $104,173. The Company also recognized a derivative liability of $3,555,030 on the transaction which is included in additional paid-in capital (Note 16).

19. Stock-Based Compensation

Stock Options

In January 2019, the Company adopted the 2019 Equity Incentive Plan under which the Company may grant incentive stock option, restricted shares, restricted share units, or other awards. Under the terms of the plan, a total of ten percent of the number of shares outstanding assuming conversion of all super voting shares and multiple voting shares to subordinate voting shares are permitted to be issued. The exercise price for incentive stock options issued under the plan will be set by the committee but will not be less 100% of the fair market value of the Company’s shares on the date of grant. Incentive stock options have a maximum term of 10 years from the date of grant. The incentive stock options vest at the discretion of the Board.

Options granted under the equity incentive plan were valued using the Black-Scholes option pricing model with the following weighted average assumptions:


	September 30,		September 30,
	2021		2020
Risk-Free Interest Rate	1.25	%	0.45 - 1.48	%
Expected Life of Options (years)	7.00		7.00 - 10.00
Expected Annualized Volatility	100.00	%	100.00	%
Expected Forfeiture Rate	N/A		N/A
Expected Dividend Yield	N/A		N/A

Stock option activity for the three months ended September 30, 2021 and for the years ended December 31, 2020 and 2019, are presented below:


		Weighted Average		Weighted Avg.
	Number of Shares	Exercise Price		Remaining Life
Balance, December 31, 2019	23,662,600	$	0.35	7.54
Forfeitures	(2,337,145)		0.65	—
Exercised	(495,067)		0.19	—
Granted	6,094,470		0.99	—
Balance, December 31, 2020	26,924,858	$	0.47	7.00
Forfeitures	(22,434)		0.97	—
Exercised	(3,989,344)		0.29	—
Granted	697,806		2.32	—
Options Outstanding at September 30, 2021	23,610,886	$	0.55	6.29

Options Exercisable at September 30, 2021	16,608,824	$	0.36	5.31

During the nine months ended September 30, 2021 and 2020, the Company recognized $2,243,761 and $1,152,052 in stock-based compensation relating to stock options, respectively. During the three months ended September 30, 2021 and 2020, the Company recognized $835,122 and $502,266 in stock-based compensation relating to stock options, respectively. As of September 30, 2021, the total unrecognized compensation costs related to unvested stock options awards granted was $3,274,032. In addition, the weighted average period over which the unrecognized compensation expense is expected to be recognized is approximately 2.5 years. The total intrinsic value of stock options outstanding and exercisable as of September 30, 2021, was $25,194,365 and $20,667,245, respectively.

The Company does not estimate forfeiture rates when calculating compensation expense. The Company records forfeitures as they occur.

Warrants

Subordinate Voting Share (SVS) warrants entitle the holder to purchase one subordinate voting share of the Company. Multiple Voting Share (MVS) warrants entitle the holder to purchase one multiple voting share of the Company.

Warrants issued were valued using the Black-Scholes option pricing model with the following assumptions:


	September 30,		September 30,
SVS Warrants Denominated in C$	2021		2020
Risk-Free Interest Rate	0.98	%	0.16	%
Expected Life of Options (years)	4.48		2.69
Expected Annualized Volatility	100.00	%	90.00	%
Expected Forfeiture Rate	N/A		N/A
Expected Dividend Yield	N/A		N/A

A summary of the warrants outstanding is as follows:


	Number of	Weighted Average		Weighted Average
SVS Warrants	Warrants	Exercise Price		Remaining Life
Warrants outstanding at December 31, 2019	16,630,309	$	2.34	4.49
Expired	(867,198)		1.50	—
Warrants outstanding at December 31, 2020	15,763,111	$	2.39	0.42
Exercised	(7,110,481)		1.02	0.19
Expired	(763,111)		4.25	—
Forfeited	(7,889,519)		3.44	0.19
Warrants outstanding at September 30, 2021	—	$	—	—

Warrants exercisable at September 30, 2021	—	$	—	—


	Number of	Weighted Average		Weighted Average
SVS Warrants Denominated in C$	Warrants	Exercise Price		Remaining Life
Warrants outstanding at December 31, 2020	—	$	—	—
Granted	3,037,649		3.50	—
Warrants outstanding at September 30, 2021	3,037,649	$	3.50	4.48

Warrants exercisable at September 30, 2021	3,037,649	$	3.50	4.48


	Number of	Weighted Average		Weighted Average
MVS Warrants	Warrants	Exercise Price		Remaining Life
Warrants outstanding at December 31, 2019	13,583	$	194.66	2.73
Issued	—		—	—
Warrants outstanding at December 31, 2020	13,583	$	194.66	1.64
Issued	—		—	—
Warrants outstanding at September 30, 2021	13,583	$	194.66	1.14

Warrants exercisable at September 30, 2021	13,583	$	194.66	1.14

During the nine months ended September 30, 2021, $0 (2020 - $10,981,157) in stock-based compensation expense was recorded in connection with the SVS compensation warrants and $0 (2020 - $112,203) in stock-based compensation was recorded in connection with the MVS warrants. During the three months ended September 30, 2021, $0 (2020 - $8,671,561) in stock-based compensation expense was recorded in connection with the SVS compensation warrants and $0 (2020 - $21,786) in stock-based compensation was recorded in connection with the MVS warrants.

20. Commitments and Contingencies

Legal proceedings

On February 25, 2019, Dr. Mark Schneyer (“Schneyer”) filed a lawsuit in Minnesota District Court, Fourth District, on his own behalf and, derivatively, on behalf of Dorchester Capital, LLC, naming Vireo U.S., Dorchester Management, LLC (“Dorchester Management”), and Dorchester Capital, LLC (“Capital”), as defendants. Dorchester Management is an affiliated entity to Vireo Health, Inc. (“Vireo U.S.”) and was previously used as a management company over Capital. It no longer has active operations following Vireo U.S.’s acquisition of MaryMed, LLC (“MaryMed”) in 2017. It is owned and controlled by Kyle Kingsley and Amber Shimpa, executive officers and directors of the Company. The essence of the claims made by Schneyer is Vireo U.S. paid an inadequate price for MaryMed, which it purchased it from Capital in 2018, and that the consideration given – shares of preferred stock in Vireo U.S. – was distributed inappropriately by Capital at the direction of Dorchester Management (the managing member of Capital). Schneyer, who is a Class B member of Capital, is seeking unspecified damages in excess of $50,000 and other relief.

Simultaneously with the complaint, Schneyer filed a motion seeking a temporary restraining order (“TRO”) to prevent the “further transfer” of MaryMed which would, Schneyer claimed, occur if Vireo U.S.’s RTO transactions were allowed to occur. The court held a hearing on the motion for TRO on March 5, 2019 and denied the motion on the same day.

The SLC, a retired judge who engaged another retired judge as legal counsel to the SLC, was appointed in accordance with Minnesota law, issued a report in May, 2021, recommending, among other things, that certain claims be permitted to proceed and other claims not be permitted to proceed by the court. As of May 6, 2021, the court has not yet issued a determination regarding any of the matters contained in the SLC’s report.

We have filed motions to dismiss the complaint and to stay the proceedings. The motion to dismiss has not yet been decided and the motion to stay was granted on November 23, 2019, pending the outcome of the SLC process. We believe that Schneyer’s claims lack merit and expect to prevail in the litigation, if and when it proceeds. However, should we not ultimately prevail, it is not possible to estimate the amount or range of potential loss, if any.

Lease commitments

The Company leases various facilities, under non-cancelable finance and operating leases, which expire at various dates through June 2085.

21. General and Administrative Expenses

General and administrative expenses are comprised of the following items:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Salaries and benefits	$	4,123,658	$	3,262,025	$	11,421,306	$	9,695,111
Professional fees		744,833		546,128		2,686,891		2,030,493
Insurance expenses		629,905		720,828		1,947,254		2,120,964
Other expenses		2,607,791		1,988,483		8,386,409		5,831,364
Total	$	8,106,187	$	6,517,464	$	24,441,860	$	19,677,932

22. Supplemental Cash Flow Information⁽¹⁾


	September 30,		September 30,
	2021		2020
Cash paid for interest	$	5,688,369	$	3,423,454
Cash paid for income taxes		5,634,500		—
Change in construction accrued expenses		(1,418,281)		—
Non-cash investing
Acquisition of Nevada through issuance of SVS		1,564,500		—
Acquisition of Nevada through restricted cash and deferred acquisition costs		1,620,636		—

(1)

For supplemental cash flow information related to leases, refer to Note 11.

23. Financial Instruments

Credit risk

Credit risk is the risk of loss associated with counterparty’s inability to fulfill its payment obligations. The Company’s credit risk is primarily attributable to cash, accounts receivable, and notes receivable. A small portion of cash is held on hand, from which management believes the risk of loss is remote. Receivables relate primarily to wholesale sales. The Company does not have significant credit risk with respect to customers. The Company’s maximum credit risk exposure is equivalent to the carrying value of these instruments. The Company has been granted licenses pursuant to the laws of the states of Arizona, Maryland, Massachusetts, Minnesota, Nevada, New Mexico, New York, and Puerto Rico with respect to cultivating, processing, and/or distributing marijuana. Presently, this industry is illegal under United States federal law. The Company has adhered, and intends to continue to adhere, strictly to the applicable state statutes in its operations.

Liquidity risk

The Company’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet liabilities when due. As of September 30, 2021, the Company’s financial liabilities consist of accounts payable and accrued liabilities, debt, and convertible notes. The Company manages liquidity risk by reviewing its capital requirements on an ongoing basis. Historically, the Company’s main source of funding has been additional funding from shareholders and debt financing. The Company’s access to financing is always uncertain. There can be no assurance of continued access to significant equity or debt financing.

Legal Risk

Goodness Growth operates in the United States. The U.S. federal government regulates drugs through the Controlled Substances Act (21 U.S.C. § 811), which places controlled substances, including cannabis, in a schedule. Cannabis is classified as a Schedule I drug. Under U.S. federal law, a Schedule I drug or substance has a high potential for abuse, no accepted medical use in the U.S., and a lack of accepted safety for the use of the drug under medical supervision. The U.S. Food and Drug Administration has not approved marijuana as a safe and effective drug for any indication. In the U.S. marijuana is largely regulated at the state level. State laws regulating cannabis are in direct conflict with the federal Controlled Substances Act, which makes cannabis use and possession federally illegal.

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign currency rates.

Interest rate risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company currently does not carry variable interest-bearing debt. Management believes that the Company is not exposed to significant interest rate risk.

24. Related Party Transactions

As of September 30, 2021, and December 31, 2020, there were no amounts due to related parties.

For the nine months ended September 30, 2021, and 2020, the Company paid a related party (Bengal Impact Partners, of which a member of the Board of Directors is a managing partner) $20,000 and $0, respectively, for ongoing corporate advisory services.

For the nine months ended September 30, 2021, and 2020, the Company paid a related party (Salo LLC, owned by a former member of the Board of Directors) for contract staffing expenses in the amount of $0 and $126,896, respectively.

Certain directors and officers of the Company (Kyle Kingsley, Amber Shimpa, and Stephen Dahmer) owned OMS, which was sold on March 31, 2021 (Note 3). None of the proceeds received from this transaction were paid to the aforementioned directors and officers, rather, they were owed and paid to the Company.

25. Subsequent Events

On November 1, 2021, subsidiaries and an affiliate of the Company entered into a Purchase Agreement with subsidiaries and an affiliate of Copperstate pursuant to which the Company will sell its Phoenix dispensary and cultivation licenses, dispensary inventory and equipment, dispensary lease, and all dispensary revenue-producing contracts to Copperstate for $15,000,010 in cash. The Company expects the Transaction to close during the fourth quarter, subject to regulatory approval and customary closing conditions. As part of the Transaction, at the closing, the parties will enter into a Retail Shelf Space Agreement pursuant to which Copperstate will continue to sell the Company’s cannabis and cannabis products at the Phoenix dispensary for two years.

As part of the Transaction, at the closing the Company and Copperstate will enter into a Cultivation Management Services Agreement (“Cultivation Agreement”) which allows the Company to continue cultivating, manufacturing, and selling wholesale medical and adult-use cannabis and cannabis products in Arizona, subject to regulatory compliance oversight by Copperstate and payment of a monthly fee. Under the Cultivation Agreement, the Company will continue its cultivation operations at its Amado facility at its own expense and will retain all of its wholesale revenue. The Cultivation Agreement has an initial term of five years and three five-year renewal terms

On October 28, 2021, the Company received regulatory approval of its acquisition of a dispensary license in Baltimore, Maryland. The previously-announced transaction is expected to close during the fourth quarter, and will bring the Company’s total number of operating dispensaries in Maryland to two.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with the financial information and the notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our outlook, plans and strategy for our business and related financing, includes “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, or “forward-looking information” within the meaning of Canadian securities laws. These statements are often identified by the use of words such as “anticipate,” “believe,” “continue,” “remain,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “project,” “will,” “would,” “should,” “potential,” “intention,” “strategy,” “strategic,” “approach,” “subject to,” “possible,” “pending,” “if,” or the negative or plural of these words or similar expressions or variations. Such forward-looking statements and forward-looking information are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements or forward-looking information. Factors that could cause or contribute to such differences include, but are not limited to, those identified in this Quarterly Report on Form 10-Q and those discussed in the section titled “Risk Factors” set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2020 and in our other SEC and Canadian public filings. Such forward-looking statements reflect our beliefs and opinions on the relevant subject based on information available to us as of the date of this report, and while we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements. You should not rely upon forward-looking statements or forward-looking information as predictions of future events. Furthermore, such forward-looking statements or forward-looking information speak only as of the date of this report. Except as required by law, we undertake no obligation to update any forward-looking statements or forward-looking information to reflect events or circumstances after the date of such statements.

Amounts are presented in United States dollars, except as otherwise indicated.

Overview of the Company

Goodness Growth is a physician-led, science-focused company and IP developer focused on building long-term, sustainable value by bringing the best of medicine, science, and engineering to the cannabis industry. With our core operations strategically located in five limited-license markets through our state-licensed subsidiaries, we cultivate and manufacture cannabis products and distribute these products through our growing network of Green Goods^® and other retail dispensaries we own or operate as well as to third-party dispensaries in the markets in which our subsidiaries hold operating licenses.

In addition to developing and maintaining cannabis businesses in our core limited-license jurisdictions, our team of scientists, engineers and attorneys also are focused on driving innovation and securing meaningful and protectable intellectual property. We believe this dual-path approach to long-term value creation enhances the potential for shareholder returns.

Our wholly-owned subsidiary Resurgent Biosciences, Inc. is a non-plant-touching entity that was formed with the intent of commercializing our intellectual property portfolio. This portfolio includes two patents for harm reduction in tobacco products as well as many other patent-pending opportunities that we believe could have potential to create additional value for shareholders through partnerships or other strategic alternatives.

While we are not currently focused on substantial capital investment or expansion outside of our core markets, we do own or effectively control additional non-core medical cannabis licenses or operations that may present opportunities in the future.

Revenue Streams

We cultivate, manufacture, and distribute cannabis products to third parties in wholesale markets and cultivate, manufacture, and sell cannabis products directly to medical patients and adult-use customers in our retail stores.

During the nine months ended September 30, 2021, we had operating revenue in six states: Arizona, Maryland, Minnesota, New Mexico, New York, and Ohio. Retail revenues were derived from sales in eighteen dispensaries throughout five states. We had one operational dispensary in Arizona, one in Maryland, eight in Minnesota, four in New Mexico, and four in New York. Wholesale revenues were derived from sales of products to third parties in the states of Arizona, Maryland, New York, and Ohio.

Our core markets in Arizona, New Mexico, and New York recently approved adult-use cannabis legalization. In Arizona, the ballot initiative to legalize adult-use sales was approved by Arizona voters in November 2020 and adult-use sales commenced in the first quarter of 2021. In March and April 2021, New York and New Mexico passed legislation approving adult-use cannabis, subject to the applicable regulatory organization approving program guidelines. Our remaining two core markets, Minnesota and Maryland, each has the potential to enact adult-use legalization in the next 24 months. In previous instances of adult-use legalization in several other state markets, licensed operators have realized substantial improvements in revenue growth rates, which gives us confidence that we will be able to drive financial performance improvements in the future in New York and New Mexico, and if such events occur in one or both of our remaining core markets, Minnesota and Maryland.

In addition to our core markets, during the nine months ended September 30, 2021, we incurred start-up expenses related to pre-revenue operations in non-core markets, including Massachusetts, Nevada, and Puerto Rico. While these markets may offer future revenue opportunities, our decision to focus efforts and capital on our core markets resulted in changes to future expectations regarding the overall revenue and profitability of our consolidated operations. We may consider operationalization of these licenses in the future.

COVID-19

Since being declared a global pandemic on March 11, 2020, the spread of COVID-19 has severely impacted many local economies around the globe. Due to COVID-19, many governments and businesses have imposed restrictions on travel and business operations, temporarily closed businesses, and/or implemented quarantines and shelter-in-place orders. Consequently, the COVID-19 pandemic has negatively impacted global economic activity, caused significant volatility and disruption in global financial markets, and generally introduced significant uncertainty and unpredictability throughout the world. Governments and central banks have responded with monetary and fiscal interventions to stabilize economic conditions.

The duration and impact of the COVID-19 pandemic, as well as the effectiveness of government and central bank responses, remains unclear at this time. Although our business has been deemed essential and/or we have been permitted to continue operating our facilities in the states in which we cultivate, process, and sell cannabis during the pendency of the COVID-19 pandemic, there is no assurance that our operations will continue to be deemed essential and/or will continue to be permitted to operate. We may incur expenses or delays relating to such events outside of our control, which could have a material, adverse effect on our business, operating results, financial condition and the trading price of our Subordinate Voting Shares. It is not possible to reliably estimate the duration and severity of these consequences, as well as their impact on the financial position and results of the Company for future periods.

Three months ended September 30, 2021 Compared to Three months ended September 30, 2020

Revenue

We derived our revenue from cultivating, processing, and distributing cannabis products through our eighteen dispensaries in five states and our wholesale sales to third parties in three states. For the three months ended September 30, 2021, 86% of the revenue was generated from retail dispensaries and 14% from wholesale business. For the three months ended September 30, 2020, 79% of the revenue was generated from retail business and 21% from wholesale business.

For the three months ended September 30, 2021, Minnesota operations contributed approximately 41% of revenues, New York contributed 24%, Arizona contributed 12%, New Mexico contributed 6%, and Maryland contributed 17%. For the three months ended September 30, 2020, Minnesota operations contributed approximately 34% of revenues, New York contributed 23%, Arizona contributed 12%, New Mexico contributed 5%, Maryland contributed 10%, Ohio contributed 1%, and Pennsylvania contributed 15%.

Revenue for the three-months ended September 30, 2021 was $13,369,432, an increase of $893,650 or 7% compared to revenue of $12,475,782 for the three-months ended September 30, 2020. The increase is primarily attributable to increased revenue contributions from the retail businesses in Minnesota and Maryland of $1.2 million and $1.1 million respectively, partially offset by the lack of third quarter 2021 revenues in the Pennsylvania retail and wholesale businesses, which were divested in 2020. Key revenue drivers are the opening of the Fredrick dispensary in Maryland in the first quarter of 2021, increased patient demand in Minnesota, which is partially the result of four new dispensary openings which occurred after September 30, 2020.

Retail revenue for the three months ended September 30, 2021 was $11,562,440 an increase of $1,658,406 or 17% compared to retail revenue of $9,904,034 for the three months ended September 30, 2020 primarily due to revenue contributions from Minnesota and Maryland.

Wholesale revenue for the three months ended September 30, 2021 was $1,806,992, a decrease of $764,756 compared to wholesale revenue of $2,571,748 for the three months ended September 30, 2020. The decrease in revenue contributions was primarily due to the disposition of our Pennsylvania retail and wholesale operations, which were divested in December and August of 2020, respectively.


	Three Months Ended
	September 30,
	2021		2020		$Change		% Change
Retail:
MN	$	5,539,552	$	4,293,831	$	1,245,721	29	%
NY		2,789,985		2,735,990		53,995	2	%
AZ		1,326,357		928,718		397,639	43	%
NM		854,105		621,728		232,377	37	%
MD		1,052,441		—		1,052,441	N.M.	%
PA		—		1,323,767		(1,323,767)	(100)	%
Total Retail	$	11,562,440	$	9,904,034	$	1,658,406	17	%

Wholesale:
AZ	$	227,824	$	541,388	$	(313,564)	(58)	%
MD		1,172,961		1,178,516		(5,555)	(0)	%
NY		406,207		181,236		224,971	124	%
OH		—		137,466		(137,466)	(100)	%
PA		—		533,142		(533,142)	(100)	%
Total Wholesale	$	1,806,992	$	2,571,748	$	(764,756)	(30)	%

Total Revenue	$	13,369,432	$	12,475,782	$	893,650	7	%
PA & OH Revenue	$	—	$	(1,994,375)	$	1,994,375	(100)	%
Total Revenue excluding PA & OH	$	13,369,432	$	10,481,407	$	2,888,025	28	%
N.M. Not Meaningful

Cost of Goods Sold and Gross Profit

Gross profit reflects total net revenue less cost of goods sold. Cost of goods sold represents the costs attributable to producing bulk materials and finished goods, which includes direct materials, labor, and certain indirect costs such as depreciation, insurance and utilities. Cannabis costs are affected by various state regulations that limit the sourcing and

procurement of cannabis product, which may create fluctuations in gross profit over comparative periods as the regulatory environment changes.

Cost of goods sold are determined from costs related to the cultivation and processing of cannabis and cannabis-derived products as well as the cost of finished goods inventory purchased from third parties.

Cost of goods sold for the three months ended September 30, 2021 was $8,254,444, an increase of $742,445 compared to the three months ended September 30, 2020 of $7,511,999, driven by higher throughput and sales.

Gross profit for the three months ended September 30, 2021 was $5,114,988, representing a gross margin of 38%. This is compared to gross profit for the three months ended September 30, 2020 of $4,963,783 or a 40% gross margin. The decrease in margin was driven by an increase in inventory valuation adjustments of $199,672 compared to the three months ended September 30, 2020. Excluding inventory valuation adjustments, margins were relatively flat. The Minnesota retail market saw slight margin expansion due to increased sales driven by the addition of four new dispensaries relative to September 30, 2020. The Minnesota margin expansion was offset by slight margin compression in New York and Arizona.

Our current production capacity has not been fully realized and we expect future gross profits to increase with revenue growth reflective of higher demand, increased product output and new product development. However, we expect gradual price compression as markets mature that could place downward pressure on our retail and wholesale gross margins.

Total Expenses

Total expenses other than the cost of goods sold consist of selling costs to support customer relationships, marketing, and branding activities. It also includes a significant investment in the corporate infrastructure required to support ongoing business.

Selling costs generally correlate to revenue. As a percentage of sales, we expect selling costs to remain relatively flat in its more established operational markets (Minnesota and New York) and decrease in developing markets as business continues to grow (Arizona, New Mexico, and Maryland). The decrease is expected to be driven primarily by the growth of retail and wholesale channels to sustainable market share.

General and administrative expenses also include costs incurred at the corporate offices, primarily related to personnel costs, including salaries, benefits, and other professional service costs, as well as corporate insurance, legal and professional fees associated with being a publicly traded company. We expect this spend to decrease as a percentage of revenue as sales continue to ramp up in all markets. We anticipate that share-based compensation expenses will continue to persist in order to recruit and retain competitive talent.

Total expenses for the three months ended September 30, 2021 were $9,245,849 an increase of $2,012,880 compared to total expenses of $7,232,969 for the three months ended September 30, 2020. The increase in total expenses was attributable to a increase in stock-based compensation expenses of approximately $0.3 million and an increase general and administrative expenses of $1.6 million which was driven by significant operational buildouts in existing markets, specifically Arizona and Maryland, where we are in the process of large cultivation and manufacturing expansion projects.

Operating Loss before Income Taxes

Operating loss before other income (expense) and provision for income taxes for the three months ended September 30, 2021 was $(4,130,861), an increase of $1,861,675 compared to $(2,269,186) for the three months ended September 30, 2020.

Total Other Income (Expense)

Total other expense for the three months ended September 30, 2021 was $(1,552,370), a change of $12,776,560 compared to other income of $11,224,190 for the three months ended September 30, 2020. This change is primarily attributable to the gain on disposal of PAMS during the three months ended September 30, 2020 of 16,884,173.

Provision for Income Taxes

Income tax expense is recognized based on the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year-end. For the three months ended September 30, 2021, tax expense totaled $560,000 compared to a tax expense of $6,003,000 for the three months ended September 30, 2020. The decrease in tax expense is primarily attributable to the gain on the disposal of PAMS during the three months ended September 30, 2020.

Nine months ended September 30, 2021 Compared to Nine months ended September 30, 2020

Revenue

We derived our revenue from cultivating, processing, and distributing cannabis products through our eighteen dispensaries in five states and our wholesale sales to third parties in four states. For the nine months ended September 30, 2021, 82% of the revenue was generated from retail dispensaries and 18% from wholesale business. For the nine months ended September 30, 2020, 74% of the revenue was generated from retail business and 26% from wholesale business.

For the nine months ended September 30, 2021, Minnesota operations contributed approximately 40% of revenues, New York contributed 26%, Arizona contributed 18%, New Mexico contributed 5%, and Maryland contributed 11%. For the nine months ended September 30, 2020, Minnesota operations contributed approximately 33% of revenues, New York contributed 23%, Arizona contributed 14%, New Mexico contributed 5%, Maryland contributed 8%, and Pennsylvania contributed 17%.

Revenue for the nine months ended September 30, 2021 was $40,790,221, an increase of $3,980,507 or 11% compared to revenue of $36,809,714 for the nine months ended September 30, 2020. The increase is primarily attributable to increased revenue contributions from the retail business in Minnesota and Maryland of $4.1 million and $2.0 million, respectively, and the wholesale business in New York of $1.6 million, partially offset by the lack of 2021 revenues in the Pennsylvania retail and wholesale businesses, which were divested in 2020. Key revenue drivers were the opening of the Fredrick dispensary in Maryland in the first quarter of 2021, increased patient demand in Minnesota, which is primarily the result of four new dispensary openings that occurred after September 30, 2020.

Retail revenue for the nine months ended September 30, 2021 was $33,247,058, an increase of $5,976,669 or 22% compared to retail revenue of $27,270,389 for the nine months ended September 30, 2020 primarily due to revenue contributions from Minnesota, Arizona, and Maryland.

Wholesale revenue for the nine months ended September 30, 2021 was $7,543,163, a decrease of $1,996,162 compared to wholesale revenue of $9,539,325 for the nine months ended September 30, 2020. The decrease in revenue contributions was primarily due to the disposition of our Pennsylvania wholesale operation, which was divested in August of 2020.


	Nine Months Ended
	September 30,
	2021		2020		$ Change		% Change
Retail:
MN	$	16,126,864	$	12,024,850	$	4,102,014	34	%
NY		8,579,124		8,007,368		571,756	7	%
AZ		4,388,668		2,976,038		1,412,630	47	%
NM		2,174,447		1,658,096		516,351	31	%
MD		1,977,955		—		1,977,955	N.M.
PA		—		2,604,037		(2,604,037)	(100)	%
Total Retail	$	33,247,058	$	27,270,389	$	5,976,669	22	%

Wholesale:
AZ	$	2,754,795	$	2,325,291	$	429,504	18	%
MD		2,571,051		2,811,138		(240,087)	(9)	%
NY		2,150,634		504,735		1,645,899	326	%
OH		66,683		376,295		(309,612)	(82)	%
PA		—		3,521,866		(3,521,866)	(100)	%
Total Wholesale	$	7,543,163	$	9,539,325	$	(1,996,162)	(21)	%

Total Revenue	$	40,790,221	$	36,809,714	$	3,980,507	11	%
PA & OH Revenue	$	(66,683)	$	(6,502,198)	$	6,435,515	(99)	%
Total Revenue excluding PA & OH	$	40,723,538	$	30,307,516	$	10,416,022	34	%
N.M. Not Meaningful

Cost of Goods Sold and Gross Profit

Cost of goods sold for the nine months ended September 30, 2021 was $23,146,503, a decrease of $1,830,898 compared to the nine months ended September 30, 2020 of $24,977,401, driven by higher throughput across all markets decreasing fixed cost per unit.

Gross profit for the nine months ended September 30, 2021 was $17,643,718, representing a gross margin of 43%. This is compared to gross profit for the nine months ended September 30, 2020 of $11,832,313 or a 32% gross margin. The increase in margin was driven by higher throughput across all markets decreasing fixed cost per unit. The Minnesota retail market saw gross profit expansion of approximately $3.5 million due to increased sales driven by the addition of four new dispensaries relative to September 30, 2020. Additionally, the New York market saw gross profit expansion of approximately $1.5 million driven by increased wholesale sales during the nine months ended September 30, 2021.

Total Expenses

Total expenses for the nine months ended September 30, 2021 were $30,134,871, a decrease of $2,510,935 compared to total expenses of $32,645,806 for the nine months ended September 30, 2020. The decrease in total expenses was attributable to a decrease in stock- based compensation expenses of approximately $7.7 million partially offset by increase general and administrative expenses of $4.8 million which was driven by significant operational buildouts in existing markets, specifically Arizona and Maryland, where we are in the process of large cultivation and manufacturing expansion projects.

Operating Loss before Income Taxes

Operating loss before other income (expense) and provision for income taxes for the nine months ended September 30, 2021 was $(12,491,153), a decrease of $8,322,340 compared to $(20,813,493) for the nine months ended September 30, 2020.

Total Other Income (Expense)

Total other expense for the nine months ended September 30, 2021 was $(3,249,254), a change of $10,186,395 compared to other income of $6,937,141 for the nine months ended September 30, 2020. The change is primarily attributable to the gain on the disposal of PAMS during the three months ended September 30, 2020, of $16,884,173.

Provision for Income Taxes

Income tax expense is recognized based on the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year-end. For the nine months ended September 30, 2021, tax expense totaled $2,970,000 compared to a tax expense of $6,800,000 for the nine months ended September 30, 2020. The decrease in tax expense is primarily attributable to the gain on the disposal of PAMS during the nine months ended September 30, 2020.

NON-GAAP MEASURES

EBITDA and Adjusted EBITDA are non-GAAP measures and do not have standardized definitions under GAAP. The following information provides reconciliations of the supplemental non-GAAP financial measures presented herein to the most directly comparable financial measures calculated and presented in accordance with GAAP. We have provided the non-GAAP financial measures, which are not calculated or presented in accordance with GAAP, as supplemental information and in addition to the financial measures that are calculated and presented in accordance with GAAP. These supplemental non-GAAP financial measures are presented because management has evaluated the financial results both including and excluding the adjusted items and believes that the supplemental non-GAAP financial measures presented provide additional perspective and insights when analyzing the core operating performance of the business. These supplemental non-GAAP financial measures should not be considered superior to, as a substitute for, or as an alternative to, and should be considered in conjunction with, the GAAP financial measures presented.


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2021		2020		2021		2020
Net income (loss)	$	(6,243,231)	$	2,952,004	$	(18,710,407)	$	(20,676,352)
Interest expense, net		2,254,553		1,255,656		6,037,057		4,249,090
Income taxes		560,000		6,003,000		2,970,000		6,800,000
Depreciation & Amortization		304,540		191,453		1,135,234		722,462
Depreciation included in cost of goods sold		691,662		699,432		1,678,558		1,757,281
EBITDA (non-GAAP)	$	(2,432,476)	$	11,101,545	$	(6,889,558)	$	(7,147,519)
Derivative (Gain) Loss		(627,165)		4,066,335		(2,317,065)		5,032,537
Inventory adjustment		351,000		151,328		464,000		484,570
Share-based compensation		835,122		524,052		4,557,777		12,245,412
Severance Expense		—		—		—		339,997
Loss on assets held for sale		—		446,544		—		446,544
Gain on sale of discontinued operations		—		(16,884,173)		(437,107)		(16,884,173)
Adjusted EBITDA (non-GAAP)	$	(1,873,519)	$	(594,369)	$	(4,621,953)	$	(5,482,632)

Liquidity, Financing Activities During the Period, and Capital Resources

We are an early-stage growth company. We are generating cash from sales and deploying our capital reserves to acquire and develop assets capable of producing additional revenues and earnings over both the immediate and near term. Capital reserves are being utilized for acquisitions in the medical and adult-use cannabis markets, for capital expenditures and improvements in existing facilities, product development and marketing, as well as customer, supplier, investor, and industry relations.

Current management forecasts and related assumptions support the view that we can adequately manage the operational needs of the business.

Credit Facility

On March 25, 2021, we entered into a credit agreement for a senior secured delayed draw term loan with an aggregate principal amount of up to $46,000,000 (the “Credit Facility”). Net of fees and closing costs of $1,971,705, we received $24,028,295 of the first tranche on March 25, 2021. Additionally, we incurred fees and closing costs of $986,035 which were paid in cash. Obligations under the Credit Facility are secured by substantially all the assets of the borrowers. The Credit Facility and related documents also provide for the payment of certain fees to the agent, including a closing fee equal to 3% of each loan advanced, and a 3.25% closing fee to the broker. The unpaid principal amounts outstanding under the Credit Facility bear interest at a rate of (a) 13.625% per annum payable monthly in cash, and (b) 2.75% per annum of paid in kind interest payable monthly. The Credit Facility matures on March 31, 2024.

On March 25, 2021, in connection with closing the Credit Facility, we issued (a) five-year warrants to the agent to and each lender to purchase an aggregate of 2,803,984 Subordinate Voting Shares at an exercise price of CDN$3.50 per share, and (b) a five year warrant to the broker to purchase 233,665 Subordinate Voting Shares at an exercise price of CDN$3.50 per share. Each warrant provides customary anti-dilution provisions.

5% Convertible Note

Cash Used in Operating Activities

Net cash used in operating activities was $22.7 million for the nine months ended September 30, 2021, an increase of $11.7 million as compared to the nine months ended September 30, 2020. The increase is primarily attributed to a substantial inventory build and a decrease in accounts payable and accrued liabilities driven by the payment of the Company’s 2020 tax liability during the nine months ended September 30, 2021, compared to stable inventory levels and an increase in accounts payable and accrued liabilities during the nine months ended September 30, 2020.

Cash Used in Investing Activities

Net cash used in investing activities was $13.4 million for the nine months ended September 30, 2021, compared to net cash provided by investing activities of $13.3 million for the nine months ended September 30, 2020. The decrease in cash flow is primarily attributable to an increase property, plant, and equipment additions driven by operational expansion in Maryland and Arizona, as well as the divestiture of the Company’s PAMS subsidiary in the third quarter of 2020.

Cash Provided by Financing Activities

Net cash provided by financing activities was $22.4 million for the nine months ended September 30, 2021, an increase of $16.1 million as compared to the nine months ended September 30, 2020. The increase was principally due to the receipt of approximately $23 million in net proceeds from the Credit Facility.

Lease Transactions

As of September 30, 2021, we have entered into lease agreements for the use of buildings used in cultivation, production and/or sales of cannabis products in Arizona, Maryland, Minnesota, Nevada, New Mexico, New York, and Puerto Rico.

The lease agreements for all of the retail space used for our dispensary operations are with third-party landlords and remaining duration ranges from 1 to 6 years. These agreements are short-term facility leases that require us to make monthly rent payments as well as funding common area costs, utilities and maintenance. In some cases, we have received tenant improvement funds to assist in the buildout of the space to meet our operating needs. As of September 30, 2021, we operated 18 retail locations secured under these agreements.

We have also entered into sale and leaseback arrangements for our cultivation and processing facilities in Minnesota and New York with a special-purpose real estate investment trust. These leases are long-term agreements that provide, among other things, funds to make certain improvements to the property that will significantly enhance production capacity and operational efficiency of the facility.

Excluding any contracts under one year in duration, the future minimum lease payments (principal and interest) on all our leases are as follows:


	Operating Leases		Finance Leases
	September 30, 2021		September 30, 2021		Total
2021	$	612,193	$	1,023,262	$	1,635,455
2022		2,471,751		7,383,555		9,855,306
2023		2,372,611		10,419,836		12,792,447
2024		2,068,139		10,466,735		12,534,874
2025		1,830,420		10,710,227		12,540,647
Thereafter		3,995,745		216,469,417		220,465,162
Total minimum lease payments	$	13,350,859	$	256,473,032	$	269,823,891
Less discount to net present value						(189,813,692)
Present value of lease liability					$	80,010,199

ADDITIONAL INFORMATION

Outstanding Share Data

As of November 8, 2021, we had 80,006,508 shares issued and outstanding, consisting of the following:

(a) Subordinate voting shares

79,538,377 shares issued and outstanding. The holders of subordinate voting shares are entitled to receive dividends which may be declared from time to time and are entitled to one vote per share at all shareholder meetings. All subordinate voting shares are ranked equally with regards to the Company’s residual assets. The Company is authorized to issue an unlimited number of no-par value subordinate voting shares.

(b) Multiple voting shares

402,720 shares issued and outstanding. The holders of multiple voting shares are entitled to one hundred votes per share at all shareholder meetings. Each multiple voting share is exchangeable for one hundred subordinate voting shares. The Company is authorized to issue an unlimited number of multiple voting shares.

(c) Super voting shares

65,411 shares issued and outstanding. The holders of super voting shares are entitled to one thousand votes per share at all shareholder meetings. Each super voting share is exchangeable for one hundred subordinate voting shares. The Company is authorized to issue an unlimited number of super voting shares.

Options, Warrants, and Convertible Promissory Notes

As of September 30, 2021, we have 23,610,886 employee stock options outstanding, as well as 3,037,649 SVS warrants denominated in C$ and 13,583 MVS warrants related to financing activities.

Off-Balance Sheet Arrangements

As of the date of this filing, we do not have any off-balance-sheet arrangements that have, or are reasonably likely to have, a current or future effect on our results of operations or financial condition, including, and without limitation, such considerations as liquidity and capital resources.

Outlook

We anticipate that recent growth investments, along with the successful execution of our core market strategy, will yield organic revenue growth for the foreseeable future. We believe that revenue growth, coupled with expectations for reduced selling, general, and administrative expenses as a percentage of revenue, should reduce the operating outflow of cash from existing operations over time. Furthermore, recent efforts to scale production and expand our retail footprint could lead to a substantial improvement in financial performance through 2022 and beyond, especially given the potential for positive regulatory developments.

We remain focused on the prudent deployment of capital into what we believe are high-yield opportunities and on achieving free cash flow from operations. We also are focused on driving margin expansion through operating efficiencies and greater economies of scale with the intention of becoming one of the lowest-cost producers in each of our operational markets. We have taken a strategic approach to facility site selection and generally pursue non-landlocked opportunities that allow for significant future expansion. Our recently completed nine-acre shade house in Arizona, 110,000 square foot expansion of our cultivation facility in Maryland, recently acquired option to purchase an additional 20 acres in Minnesota for future expansion, and ongoing expansion projects in New York demonstrate our large-scale approach to production.

Consistent with a focus on driving profitable growth across our various markets, we are in the process of making further investments in capital expenditures to improve scale with additional facility build outs as our markets continue expanding. Specifically, we have begun construction on a 324,000 square foot indoor cultivation and processing facility in New York, which is being financed entirely through a real estate partner following the execution of a sale-leaseback transaction during the third quarter of 2021. We have been approved by the state to complete 170,000 square feet of this facility, and anticipate completion of this project during the second quarter of 2022.

In Arizona, we completed construction of a second nine-acre shade house adjacent to our existing operations, bringing our total cultivation capacity in the state to approximately 18 acres. We also plan to add a 30,000 square foot processing facility to the property in Arizona. In Maryland, we began development of an additional 75,000 sq. ft. of cultivation capacity at our existing 110,000 sq. ft. facility in the town of Massey. We previously anticipated these expansion projects in Arizona and Maryland would be completed by the end of 2021, but we have opted to pause construction of these projects as we align development timing with the demand growth we are experiencing in these markets.

Our retail strategy is focused on the growth of our retail footprint and ongoing efforts to rebrand our stores to our Green Goods^® retail concept. We opened four new stores in Minnesota in 2020, one new store in Maryland in March of 2021, and finished construction of two additional stores in New Mexico during the second quarter of 2021 which opened in the summer of 2021. We are also evaluating the rebranding of our retail stores in New York as we consider expansion from four to eight dispensaries, but the timing of these initiatives will depend upon the timeline for commencement of adult use sales in the state, as well as regulatory approval of the incremental dispensaries.

In addition to the recent legislation legalizing adult-use cannabis in Arizona, New Mexico, and New York and recent approval of raw flower to the medical program in Minnesota, Maryland could also potentially pass adult-use legislation in 2022 via legislation and/or a ballot initiative. We believe that each of these recent changes in state programs, once sales commence, will serve as significant revenue growth catalyst for our business, and that with large-scale production across our markets there are clear opportunities to protect and expand margins over time.

Following our recent decision to divest our Arizona licenses and Phoenix dispensary in order to focus solely on the wholesale market in Arizona, as well as uncertainty surrounding the start date of adult-use sales in the state of New York, we have revised our previous outlook ranges for financial performance in fiscal year 2022. We now expect fiscal year 2022 revenues to be in the range of $100 to $120 million, and adjusted EBITDA in the range of $20 to $30 million. The achievement of these ranges will depend upon several factors, including the Company’s ability to achieve expected cultivation yields and quality, the timing and availability of funding to complete various development projects, regulatory timelines, the timing of the commencement and performance of adult-use sales in New Mexico and New York, and the timing of the commencement and magnitude of flower sales in the Minnesota medical market.

We expect net capex, excluding financing from real estate partners, to be in the range of approximately $15 to $20 million through 2022. We expect to open an additional four Green Goods® retail dispensaries in New York prior to the start of adult use sales in that state and we expect to add additional stores in New Mexico through the end of 2022. Assuming timely completion of the planned development projects and that the timing of regulatory changes is as we anticipate, we expect to generate positive cash flow from operations for full fiscal year 2022.

Critical Accounting Policies

There have been no material changes to our critical accounting policies and estimates from the information provided in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included in our 2020 Annual Report on Form 10-K for the year ended December 31, 2020.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Quantitative and qualitative disclosures about market risk have been omitted as permitted under rules applicable to smaller reporting companies.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) are designed to ensure that information required to be disclosed by us in reports we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the appropriate time periods, and that such information is accumulated and communicated to the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely discussions regarding required disclosure. We, under the supervisions of and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2021 and, based on that evaluation, have concluded that the design and operation of our disclosure controls and procedures were effective as of such date.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f)) during the three and nine months ended September 30, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

We are involved in various regulatory issues, claims and lawsuits arising in the ordinary course of business, none of which, in the opinion of management, is expected to have a material, adverse effect on our results of operations or financial condition.

Schneyer Litigation

Weeks prior to commencement of the litigation, Dorchester Management had appointed a special litigation committee (“SLC”) on behalf of Capital to investigate the consideration provided by Vireo U.S. for the purchase of MaryMed and assess any potential claims Capital may have as a result of the transaction. The SLC, a retired judge who engaged another retired judge as legal counsel to the SLC, was appointed in accordance with Minnesota law, issued a report in May, 2021, recommending, among other things, that certain claims be permitted to proceed and other claims not be permitted to proceed by the court. As of May 6, 2021, the court has not yet issued a determination regarding any of the matters contained in the SLC’s report.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On June 4, 2021, we issued 295,774 subordinated voting shares to a third party for ongoing corporate advisory services. We did not receive any proceeds in connection with the issuance of these shares. The shares issued are subject to a holding period expiring October 5, 2021.

Item 6. Exhibits

Exhibit No.		Description of Exhibit

10.1		Purchase and Sale Agreement and Joint Escrow Instructions, dated September 1, 2021, by and between Vireo Health of New York, LLC and IIP-NY 2 LLC

10.2		First Amendment to Purchase and Sale Agreement and Joint Escrow Instructions, dated September 24, 2021, by and between Vireo Health of New York, LLC and IIP-NY 2 LLC

10.3		Third Amendment to Lease Agreement, dated September 24, 2021, by and between IIP-NY 2 LLC and Vireo Health of New York, LLC

31.1		Rule 13a-14(a)/15d-14(a) certification of Chief Executive Officer

31.2		Rule 13a-14(a)/15d-14(a) certification of Chief Financial Officer

32.1		Section 1350 certification, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101		Includes the following financial and related information from Goodness Growth’s Quarterly Report on Form 10-Q as of and for the quarter ended September 30, 2021, formatted in Inline Extensible Business Reporting Language (iXBRL): (1) the Consolidated Balance Sheets, (2) the Consolidated Statements of Income, (3) the Consolidated Statements of Comprehensive Income, (4) the Consolidated Statements of Changes in Stockholders’ Equity, (5) the Consolidated Statements of Cash Flows, and (6) Notes to Consolidated Financial Statements.

104		The cover page from this Quarterly Report on Form 10-Q, formatted in Inline XBRL.

SIGNATURES

Pursuant to requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	GOODNESS GROWTH HOLDINGS, INC.

Date: November 10, 2021	By:	/s/ Kyle E. Kingsley
		Name:	Kyle E. Kingsley
		Title:	Chief Executive Officer

Date: November 10, 2021	By:	/s/ John A. Heller
		Name:	John A. Heller
		Title:	Chief Financial Officer

Exhibit 10.1

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PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company "SELLER" AND IIP-NY 2 LLC, a Delaware limited liability company "BUYER" September 1, 2021 Tyron Technology Park County Highway 107 Perth, New York

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TABLE OF CONTENTS Page ARTICLE 1 CERTAIN DEFINITIONS .......................................................................................................................1 ARTICLE 2 PURCHASE, PURCHASE PRICE AND PAYMENT.............................................................................5 ARTICLE 3 ESCROW..................................................................................................................................................6 ARTICLE 4 INVESTIGATION PERIOD; VOLUNTARY TERMINATION; TITLE ................................................7 ARTICLE 5 PRE-CLOSING OBLIGATIONS OF SELLER AND BUYER .............................................................10 ARTICLE 6 SELLER'S DELIVERIES .......................................................................................................................11 ARTICLE 7 BUYER'S DELIVERIES ........................................................................................................................12 ARTICLE 8 CONDITIONS TO CLOSING; CLOSING; DEFAULT; REMEDIES .................................................12 ARTICLE 9 REPRESENTATIONS AND WARRANTIES OF SELLER .................................................................17 ARTICLE 10 REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF BUYER .........................................................................................................................................................20 ARTICLE 11 COSTS, EXPENSES AND PRORATIONS.........................................................................................20 ARTICLE 12 ACTIONS TO BE TAKEN AT THE CLOSING .................................................................................21 ARTICLE 13 BROKERS ............................................................................................................................................22 ARTICLE 14 INDEMNIFICATION...........................................................................................................................22 ARTICLE 15 MISCELLANEOUS .............................................................................................................................23 EXHIBITS Exhibit A Exhibit B Exhibit C Exhibit D Exhibit E Exhibit F Exhibit G Exhibit H Legal Description of Land Seller's Deed Intentionally Omitted Certificate of Non-Foreign Status Intentionally Omitted Assignment of Permits, Entitlements and Intangible Property General Provisions of Escrow Form of Lease Amendment SCHEDULES 1.0 2.0 3.0 List of Seller's Deliveries Environmental Disclosure Statement Excluded Property

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PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS TO: Settlement Corp ("Escrow Agent") 5301 Wisconsin Avenue, N.W. #710 Washington, D.C. 20015 Attn: Todd Deckelbaum TEL: (202) 537-0005 x104 E-mail: tdeckelbaum@settlementcorp.com THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS ("Agreement") is made and entered into and effective as of the 1st day of September, 2021, by and between VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company ("Seller"), and IIP-NY 2 LLC, a Delaware limited liability company ("Buyer"), each of whom shall sometimes separately be referred to herein as a "Party" and both of whom shall sometimes collectively be referred to herein as the "Parties." This Agreement constitutes: (a) a binding purchase and sale agreement between Seller and Buyer; and (b) joint escrow instructions to Escrow Agent whose consent appears at the end of this Agreement. FOR GOOD AND VALUABLE CONSIDERATION RECEIVED, the Parties mutually agree as follows: ARTICLE 1 CERTAIN DEFINITIONS In addition to those terms defined elsewhere in this Agreement, the following terms have the meanings set forth below: "Affiliate" shall mean, with respect to any particular Person, any other Person that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person. For this purpose, the term "control" shall be deemed satisfied to the extent that there exists direct or indirect ownership representing a minimum ten percent (10%) ownership interest. "Agreement" shall mean this Purchase and Sale Agreement and Joint Escrow Instructions dated as of the 1st day of September 2021, by and between Seller and Buyer, together with all Exhibits and Schedules attached hereto. "ALTA" shall mean American Land Title Association. "ALTA Extended Coverage Policy" shall have the meaning given such term in Section 8.1(c) hereof. "Asserted Liability" shall have the meaning given to such term in Section 14.2 hereof. "Assignment of Permits, Entitlements and Intangible Property" shall mean the Assignment of Permits, Entitlements and Intangible Property, in the form of Exhibit F attached and incorporated herein by reference or such other form reasonably approved by Buyer. "Business Day" shall mean a Calendar Day, other than a Saturday, Sunday or a day observed as a legal holiday by the United States federal government or the State of New York. "Buyer" shall mean IIP-NY 2 LLC, a Delaware limited liability company, its successors and assigns. "Buyer Indemnitees" shall have the meaning ascribed to such term in Section 14.1(a) hereof. "Buyer's Election Not to Terminate" shall have the meaning given to such term in Section 4.3 hereof. "Buyer's Election to Terminate" shall have the meaning given to such term in Section 4.2 hereof. "Calendar Day" shall mean any day of the week including a Business Day. 1

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"Cash" shall mean legal tender of the United States of America represented by either: (a) currency; (b) a cashier's or certified check or checks currently dated, payable to Escrow Agent or order, and honored upon presentation for payment; or (c) immediately available funds wire transferred or otherwise deposited into Escrow Agent's account at Escrow Agent's direction. "Certificate of Non-Foreign Status" shall mean that certain Certificate of Non-Foreign Status, in the form of Exhibit D attached hereto and incorporated herein by reference. "Claims Notice" shall have the meaning given to such term in Section 14.2 hereof. "Closing" shall have the meaning given to such term in Section 8.4 hereof. "Closing Date" shall have the meaning given to such term in Section 8.4 hereof. "Closing Deposit" shall have the meaning given to such term in Section 2.2(c) hereof. "Code" shall mean the Internal Revenue Code of 1986, as amended, or corresponding provisions of subsequent federal revenue laws. "Condemnation Proceeding" shall have the meaning given to such term in Section 8.3(a) hereof. "Contracts" shall mean all written or oral: (a) insurance, management, leasing, security, janitorial, cleaning, pest control, waste disposal, landscaping, advertising, service, maintenance, operating, repair, collective bargaining, employment, employee benefit, severance, franchise, licensing, supply, purchase, consulting, professional service, advertising, promotion, public relations and other contracts and commitments in any way relating to the Property or any part thereof, together with all supplements, amendments and modifications thereto; and (b) equipment leases and all rights and options of Seller thereunder, together with all supplements, amendments and modifications thereto. "Cure Notice" shall have the meaning given to such term in Section 4.1(b) hereof. "Disapproved Title Exceptions" shall have the meaning given to such term in Section 4.1(b) hereof. "Disapproved Title Exceptions Notice" shall have the meaning given to such term in Section 4.1(b) hereof. "Eastern Time" shall mean Eastern Standard Time (or Eastern Daylight Savings Time, whichever shall be in effect at the time in question). "Effective Date" shall mean, provided that this Agreement has been executed and delivered by both Buyer and Seller, the later of (a) the date this Agreement is executed and delivered by Buyer or (b) the date this Agreement is executed and delivered by Seller, as such dates appear after each Party's signature herein below. "Environmental Laws" shall mean all applicable federal, state or local laws, ordinances, codes, statutes, regulations, administrative rules, policies and orders, and other authorities, which relate to the environment and/or which classify, regulate, impose liability, obligations, restrictions on ownership, occupancy, transferability or use of the Real Property, and/or list or define hazardous substances, materials, wastes, contaminants, pollutants and/or the Hazardous Materials. "Escrow" shall have the meaning given to such term in Article 3 hereof. "Escrow Agent" shall have the meaning given to such term in the preamble of this Agreement. "Excluded Property" means the property, if any, described on Schedule 3.0 attached hereto and incorporated herein by reference. "Existing PSA" shall mean that certain Purchase Option Agreement dated October 13, 2020, by and between Owner and Seller, together with the exercise notice letter from Seller to Owner dated May 14, 2021. 2

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"General Provisions" shall have the meaning given to such term in Article 3 hereof. "Guarantors" shall have the meaning given to such term in the Lease. "Guaranty" shall mean the Guaranty in the form attached as Exhibit D to the Lease. "Hazardous Materials" shall mean all hazardous wastes, toxic substances, pollutants, contaminants, radioactive materials, flammable explosives, other such materials, including, without limitation, substances defined as "hazardous substances," "hazardous wastes," "hazardous materials," "toxic substances," "toxic pollutants," "petroleum substances," or "infectious waste" in any applicable laws or regulations including, without limitation, the Environmental Laws, and any material present on the Real Property that has been shown to have significant adverse effects on human health including, without limitation, radon, pesticides, asbestos, polychlorinated biphenyls, urea formaldehyde foam insulation, petroleum products (including any products or by-products therefrom), lead-based paints and any material containing or constituting any of the foregoing, and any such other substances, materials and wastes which are or become regulated by reason of actual or threatened risk of toxicity causing injury or illness, under any Environmental Laws or other applicable federal, state or local law, statute, ordinance or regulation, or which are classified as hazardous or toxic under current or future federal, state or local laws or regulations. Notwithstanding anything in this Agreement to the contrary, the Parties agree that cannabis and all derivatives of cannabis including those used or created in the creation of medical cannabis are not to be deemed Hazardous Materials. "Improvements" shall mean all buildings, structures, fixtures, systems, facilities and other improvements now or hereafter located on the Land, if any, together with all water control systems, utility lines and related fixtures and improvements, drainage facilities, landscaping improvements, fencing, roadways and walkways, and all privileges, rights, easements, hereditaments and appurtenances thereto belonging, but specifically excluding the Excluded Property. "Indemnitees" shall have the meaning given to such term in Section 14.2 hereof. "Indemnitor" shall have the meaning given to such term in Section 14.2 hereof. "Independent Consideration" shall have the meaning given to such term in Section 2.2(b) hereof. "Information" shall have the meaning given to such term in Section 4.4 hereof. "Initial Deposit" shall have the meaning given to such term in Section 2.2(a) hereof. "Intangible Property" shall have the meaning given to such term in Section 2.1(c) hereof. "Investigation Period" shall have the meaning given to such term in Section 4.1 hereof. "Joiner" shall have the meaning given to such term in Section 15.16 hereof. "Land" shall mean that certain parcel of real property comprising ninety-six (96) acres located in the City of Perth, County of Fulton, State of New York, the legal description of which is set forth on Exhibit A attached hereto and incorporated herein by reference. "Lease" shall mean that certain Lease Agreement by and between Buyer, as landlord, and Seller, as tenant, dated as of October 23, 2017, as amended by that certain First Amendment to Lease Agreement dated as of December 7, 2018, and as further amended by that certain Second Lease Amendment dated as of April 10, 2020. "Lease Amendment" shall mean the Third Amendment to Lease, in the form of Exhibit H attached hereto and incorporated herein by reference. "Losses" shall have the meaning given to such term in Section 14.1 hereof. 3

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"Material Loss" shall mean any damage, loss or destruction to any portion of the Real Property, the loss of which is equal to or greater than One Hundred Thousand Dollars ($100,000.00) (measured by the cost of repair or replacement). "Monetary Obligations" shall mean any and all liens, liabilities and encumbrances placed, or caused to be placed, of record against the Real Property evidencing a monetary obligation which can be removed by the payment of money, including, without limitation, delinquent real property taxes and assessments, deeds of trust, mortgages, mechanic's liens, attachment liens, execution liens, tax liens and judgment liens. Notwithstanding the foregoing, the term "Monetary Obligations" shall not include and shall specifically exclude the liens, liabilities and encumbrances relating to the Permitted Title Exceptions and any matters caused by any act or omission of Buyer, or its agents or representatives. "New Title Exceptions" shall have the meaning given to such term in Section 4.1(c) hereof. "Non-Material Loss" shall mean damage, loss or destruction to any portion of the Real Property, the loss of which is less than One Hundred Thousand Dollars ($100,000.00) (measured by the cost of repair or replacement). "Notice" shall have the meaning given to such term in Section 15.2 hereof. "Notice of Loss" shall have the meaning given to such term in Section 14.2(c) hereof. "OFAC" shall have the meaning given to such term in Section 9.16 hereof. "Owner" shall mean Fulton County Industrial Development Agency. "Party" or "Parties" shall have the meaning given to such terms in the Preamble of this Agreement. "Permits and Entitlements" shall have the meaning given to such term in Section 2.1(d) hereof. "Permitted Title Exceptions" shall have the meaning given to such term in Section 4.1(b) hereof. "Person" shall mean any individual, corporation, partnership, limited liability company or other entity. "Personal Property" shall have the meaning given to such term in Section 2.1(b) hereof. "Preliminary Title Report" shall have the meaning given to such term in Section 4.1(b) hereof. "Property" shall have the meaning given to such term in Section 2.1 hereof. "Purchase Price" shall have the meaning given to such term in Section 2.2 hereof. "Real Property" shall have the meaning given to such term in Section 2.1(a) hereof. "Seller" shall mean Vireo Health of New York, LLC, a New York limited liability company. "Seller Indemnitees" shall have the meaning given to such term in Section 14.1(b) hereof. "Seller's Deed" shall mean the Bargain and Sale Deed, in the form of Exhibit B attached hereto and incorporated herein by reference or such other form reasonably approved by Buyer and acceptable to Title Insurer. "Seller's Deliveries" shall have the meaning given to such term in Section 4.1(a) hereof. "Survey" shall have the meaning given to such term in Section 4.1(b) hereof. "Tenant" shall mean Seller. 4

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"Title Insurer" shall mean Stewart Title Guaranty Company or another title company acceptable to Buyer. "Transaction Documents" shall mean Seller's Deed, the Certificate of Non-Foreign Status, the Assignment of Permits, Entitlements and Intangible Property and all other instruments or agreements to be executed and delivered pursuant to this Agreement or any of the foregoing. ARTICLE 2 PURCHASE, PURCHASE PRICE AND PAYMENT Section 2.1 Purchase and Sale of Property. Subject to the terms and conditions set forth in this Agreement, on the Closing, Seller shall sell, convey, assign, transfer and deliver to Buyer, and Buyer shall purchase from Seller, all of the following property (collectively, the "Property"): (a) Real Property. The Land and the Improvements, together with all of Seller's right, title and interest in, to and under: (i) all easements, rights-of-way, development rights, entitlements, air rights and appurtenances relating or appertaining to the Land and/or the Improvements; (ii) all water wells, streams, creeks, ponds, lakes, detention basins and other bodies of water in, on or under the Land, whether such rights are riparian, appropriative, prospective or otherwise, and all other water rights applicable to the Land and/or the Improvements; (iii) all sewer, septic and waste disposal rights and interests applicable or appurtenant to or used in connection with the Land and/or the Improvements; (iv) all minerals, oil, gas and other hydrocarbons located in, on or under the Land, together with all rights to surface or subsurface entry; and (v) all streets, roads, alleys or other public ways adjoining or serving the Land, including any land lying in the bed of any street, road, alley or other public way, open or proposed, and any strips, gaps, gores, culverts and rights of way adjoining or serving the Land, free and clear of any and all liens, liabilities, encumbrances, exceptions and claims, other than the Permitted Title Exceptions (collectively, the "Real Property"). (b) Personal Property.All equipment, facilities, machinery, tools, appliances, fixtures, furnishings, furniture, paintings, sculptures, art, inventories, supplies, computer equipment and systems, telephone equipment and systems, satellite dishes and related equipment and systems, security equipment and systems, fire prevention equipment and systems, and all other items of tangible personal property owned by Seller and located on or about the Real Property or used in conjunction therewith, free and clear of any and all liens, liabilities, encumbrances, exceptions and claims, but excepting therefrom the Excluded Property (collectively, the "Personal Property"). (c) Intangible Property. All of Seller's right, title and interest in and to all intangible personal property not otherwise described in this Section 2.1 and relating to the Property or the business of owning, operating, maintaining and/or managing the Property, including, without limitation: (i) all warranties, guarantees and bonds from third parties, including, without limitation, contractors, subcontractors, materialmen, suppliers, manufacturers, vendors and distributors; (ii) all deposits, reimbursement rights, refund rights, receivables and other similar rights from any governmental or quasi-governmental agency; and (iii) all liens and security interests in favor of Seller, together with any instruments or documents evidencing same, free and clear of any and all liens, liabilities, encumbrances, exceptions and claims, but excepting therefrom the Excluded Property (collectively, the "Intangible Property"). (d) Permits and Entitlements. All of Seller's right, title and interest in, to and under: (i) all permits, licenses, certificates of occupancy, approvals, authorizations and orders obtained from any governmental authority and relating to the Real Property or the business of owning, maintaining and/or managing the Real Property, including, without limitation, all land use entitlements, development rights, density allocations, certificates of occupancy, sewer hook-up rights and all other rights or approvals relating to or authorizing the ownership, operation, management and/or development of the Real Property (including but not limited all such rights or approvals necessary and appropriate for the Permitted Use (as defined in the Lease)); (ii) all preliminary and final drawings, renderings, blueprints, plans and specifications (including "as-built" plans and specifications), and tenant improvement plans and specifications for the Improvements (including "as-built" tenant improvement plans and specifications); (iii) all maps and surveys for any portion of the Real Property; (iv) all items constituting the Seller's Deliveries; and (v) any and all other items of the same or similar nature pertaining to the Real Property, and all changes, additions, substitutions and replacements for any of the foregoing, free and clear of any and all liens, liabilities, encumbrances, exceptions and claims, but excepting therefrom the Excluded Property (collectively, the "Permits and Entitlements"). 5

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Section 2.2 Purchase Price. The purchase price for the Property ("Purchase Price") shall be the sum of One Million Two Hundred Eighty-Eight Thousand Five Hundred Dollars ($1,288,500.00). Buyer and Seller acknowledge that the Purchase Price shall be subject to Buyer’s verification during the Investigation Period of third party costs incurred by Seller in connection with the acquisition and development of the Property. Seller agrees to cooperate with Buyer to provide invoices, lien releases and such other documentation as may be reasonably requested by Buyer to verify such third party costs and to provide evidence of any additional third party costs relating to the acquisition and development of the Property incurred by Seller following the Effective Date of this Agreement. In the event that Buyer determines that the Purchase Price requires adjustment during the Investigation Period, Buyer and Seller shall confer in good faith to determine the final Purchase Price and amend this Agreement to adjust the Purchase Price and Lease form accordingly. In the event that, despite each Party’s good faith efforts to reasonably agree upon a final Purchase Price, the parties are not able to reach an agreement regarding the foregoing, then Buyer shall have the right to terminate this Agreement pursuant to Section 4.2 no later than the expiration of the Investigation Period. The Purchase Price shall be payable by Buyer to Seller in accordance with the following terms and conditions: (a) Initial Deposit. Within three (3) Business Days following the Effective Date, Buyer shall deposit into Escrow the sum of One Hundred Thousand Dollars ($100,000.00), in the form of Cash, which amount shall serve as an earnest money deposit ("Initial Deposit"). Buyer may direct Escrow Agent to invest the Initial Deposit in one or more interest bearing accounts with a federally insured state or national bank designated by Buyer and approved by Escrow Agent. Subject to the applicable termination and default provisions contained in this Agreement: (i) the Initial Deposit shall remain in Escrow prior to the Closing; (ii) upon the Closing, the Initial Deposit shall be applied as a credit towards the payment of the Purchase Price; and (iii) all interest that accrues on the Initial Deposit while in Escrow Agent's control shall belong to Buyer. Buyer shall complete, execute and deliver to Escrow Agent a W-9 Form, stating Buyer's taxpayer identification number at the time of delivery of the Initial Deposit. All references in this Agreement to the "Initial Deposit" shall mean the Initial Deposit and any and all interest that accrues thereon while in Escrow Agent's control. (b) Independent Consideration. Concurrently with Buyer's delivery of the Initial Deposit, Buyer shall deposit into Escrow the additional sum of One Hundred Dollars ($100.00) as independent consideration for Seller's execution of this Agreement (the "Independent Consideration"). Such Independent Consideration shall be non-refundable to Buyer under all circumstances, and upon the Closing, the Independent Consideration, together with all interest that accrues on the Independent Consideration while in Escrow Agent's control, shall be applied as a credit towards the payment of the Purchase Price. (c) Closing Deposit. The Purchase Price less the Initial Deposit ("Closing Deposit"), shall be paid by Buyer to Escrow Agent, in the form of Cash, pursuant to Section 7.1 hereof, and distributed by Escrow Agent to Seller on the Closing in accordance with the provisions of Section 12.1(c) hereof. Section 2.3 Direct Transfer Option. In recognition of the fact that the Closing is intended to occur concurrently with the closing under the Existing PSA and that the Property will ultimately be conveyed, assigned and transferred to Buyer on the Closing, the Parties hereby acknowledge and agree that, for convenience purposes and in order to avoid any duplicative costs, fees and expenses, legal title to the Property may, upon Seller’s direction, be conveyed, assigned and transferred directly by Owner to Buyer in the event that Owner agrees to convey, assign and transfer the Property directly to Buyer. In the event Owner and the Parties agree to proceed with a direct transfer in accordance with the foregoing, then notwithstanding any provision to the contrary set forth herein, all of the Transaction Documents shall be entered into directly by and between Owner and Buyer, subject to the terms and conditions set forth in this Agreement, and the Parties agree to reasonably cooperate with one another and with Escrow Agent to execute such additional documents and agreements as may be reasonably required to effectuate the direct transfer of the Property from Owner to Buyer and to avoid or minimize any duplicative costs, fees and expenses relating to the transfer of the Property under the Existing PSA and this Agreement. ARTICLE 3 ESCROW Within three (3) Business Days following the Effective Date, Seller and Buyer shall open an escrow ("Escrow") with Escrow Agent by Buyer depositing with Escrow Agent the Initial Deposit. By each Party’s signature to this Agreement and by Escrow Agent’s signature to the Consent of Escrow Agent, the Parties and Escrow Agent shall be deemed to have agreed to the Escrow Agents' General Provisions, which are attached hereto as Exhibit G 6

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("General Provisions"). The date of delivery of the Initial Deposit shall constitute the opening of Escrow and upon such delivery, this Agreement shall constitute joint escrow instructions to Escrow Agent, which joint escrow instructions shall supersede all prior escrow instructions related to the Escrow, if any. Seller and Buyer hereby agree to promptly execute and deliver to Escrow Agent any additional or supplementary escrow instructions as may be necessary or convenient to consummate the transactions contemplated by this Agreement; provided, however, that neither the General Provisions, nor any such additional or supplemental escrow instructions shall supersede this Agreement, and in all cases this Agreement shall control, unless the General Provisions or such additional or supplemental escrow instructions expressly provide otherwise. ARTICLE 4 INVESTIGATION PERIOD; VOLUNTARY TERMINATION; TITLE Section 4.1 Investigation Period. During the time period commencing upon the Effective Date of this Agreement, and terminating at 11:00 p.m. Eastern Time on September 24, 2021 (the "Investigation Period"), Buyer shall have the right to conduct and complete an investigation of all matters pertaining to the Property and Buyer's purchase thereof including, without limitation, the matters described in this Section 4.1. (a) Seller's Deliveries. Within three (3) Calendar Days following the Effective Date of this Agreement, Seller, at Seller's expense, shall cause to be delivered to Buyer, to the extent within its possession or reasonable control, true, correct and complete copies of all documents, agreements and other information relating to the Property, Seller, Tenant and Guarantors listed on Schedule 1.0 attached hereto and incorporated herein by reference (collectively, the "Seller's Deliveries"). Seller will promptly deliver to Buyer true, correct and complete copies of any supplements and/or updates of Seller's Deliveries to the extent such items are received by Seller prior to Closing. During the Investigation Period, Buyer shall have the right to conduct and complete an investigation of all matters pertaining to Seller's Deliveries and all other matters pertaining to the Property and Buyer's acquisition thereof. In this regard, Buyer shall have the right to contact the Seller's management, governmental agencies and officials and other parties and make reasonable inquiries concerning Seller's Deliveries and any and all other matters pertaining to the Property. Seller agrees to reasonably cooperate with Buyer in connection with Buyer's investigation of Seller's Deliveries and all other matters pertaining to the Property. (b) Preliminary Title Report/Survey. On or before (i) the expiration of five (5) Business Days following the Effective Date, Buyer shall order a preliminary title report covering the Real Property, together with copies of all documents referred to as exceptions therein ("Preliminary Title Report"), from Title Insurer; and (ii) the expiration of thirty (30) Calendar Days following the Effective Date, date that is , Buyer shall cause a current ALTA Survey of the Real Property to be prepared by a surveyor licensed under the laws of the state where the Real Property is located, which ALTA Survey shall be in form and substance reasonably satisfactory to Buyer, and which ALTA survey shall be prepared in accordance with the most current ALTA/ACSM Minimum Standard Detail Requirements with such Table A items selected by Buyer and any other standards of Buyer ("Survey"). Not later than 8:00 p.m. Eastern Time on the date that is September 10, 2021, Buyer shall have the right to notify Seller in writing ("Disapproved Title Exceptions Notice") of Buyer's disapproval of any matters set forth in the Preliminary Title Report and the Survey ("Disapproved Title Exceptions"). In the event Buyer timely delivers to Seller a Disapproved Title Exceptions Notice, Seller shall have the right, but not the obligation (except with respect to Disapproved Title Exceptions that constitute Monetary Obligations, as set forth below), to agree to cure one or more of the Disapproved Title Exceptions by giving Buyer written notice ("Cure Notice") of such election not later than 8:00 p m. Eastern Time on or before the date that is seven (7) Business Days following Seller’s receipt of Buyer’s Disapproved Title Exceptions Notice. Following the timely receipt of a Disapproved Title Exceptions Notice from Buyer, if Seller fails to timely deliver a Cure Notice to Buyer, then Seller shall be deemed to have elected not to cure any of the Disapproved Title Exceptions. A Disapproved Title Exception shall be deemed to have been cured if Seller causes such item to be removed from the record title of the Real Property and not listed as a title exception on the ALTA Extended Coverage Policy prior to the Closing or otherwise cures such Disapproved Title Exception as determined by Buyer in Buyer's sole and absolute discretion. In the event Seller timely elects (or is deemed to have timely elected) not to cure the Disapproved Title Exceptions, then prior to the expiration of the Investigation Period, Buyer may elect: (i) to terminate this Agreement and the Escrow pursuant to the provisions of Section 4.2 hereof; or (ii) to not terminate this Agreement and the Escrow pursuant to Section 4.3 hereof, in which case those Disapproved Title Exceptions which are not cured and which are 7

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not Monetary Obligations which Seller is obligated to cure on or before the Closing pursuant to Section 5.1(c) hereof, shall be deemed to constitute Permitted Title Exceptions. Following the timely receipt of a Disapproved Title Exceptions Notice from Buyer, if Seller elects to cure one or more of the Disapproved Title Exceptions, then Seller shall have until the last Business Day immediately preceding the Closing Date to cure the applicable Disapproved Title Exceptions. In the event Seller: (A) timely elects to cure the Disapproved Title Exceptions; and (B) fails to timely cure any Disapproved Title Exceptions that Seller has elected to cure on or before the Closing Date, then Seller shall be in default under this Agreement and, in such a case, at any time on or before the Closing Date, Buyer may elect to either: (1) continue this Agreement in effect without modification and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to such Disapproved Title Exceptions (which will be deemed to constitute "Permitted Title Exceptions"); or (2) terminate this Agreement and the Escrow pursuant to the provisions of Section 8.6(a) hereof. Notwithstanding any provision in the Agreement to the contrary, pursuant to Section 5.1(c) hereof, Seller shall be obligated to cure all Monetary Obligations on or before the Closing. Fee title to the Real Property shall be conveyed by Seller to Buyer subject only to the following exceptions to title (collectively, the "Permitted Title Exceptions"): (i) Non-delinquent real and personal property taxes and assessments; (ii) The lien of supplemental taxes, if any; (iii) Any lien voluntarily imposed by Buyer; (iv) The possessory rights of Tenant under the Lease, as amended by the Lease Amendment; (v) Any matters set forth in the Preliminary Title Report and the Survey that are approved by Buyer in accordance with the procedures and within the time periods set forth in Section 4.1(b) hereof; and (vi) All New Title Exceptions approved by Buyer pursuant to Section 4.1(c) hereof. (c) New Title Exceptions. In the event that prior to the Closing, any new title exceptions are discovered by or revealed to Seller, which new title exceptions were not otherwise set forth or referred to in the Preliminary Title Report and were not caused by Buyer ("New Title Exceptions"), Seller shall deliver written notice to Buyer disclosing the existence of such New Title Exceptions, together with copies of all underlying documents, and unless such New Title Exception is the result of a default by Seller hereunder (in which case the provisions of Section 8.6 shall govern), each of Buyer and Seller shall have the rights and obligations in Section 4.1(b), mutatis mutandis, with respect thereto; provided, however, Buyer shall have a period of five (5) Business Days following receipt of such New Title Exceptions in which to provide a Disapproved Title Exceptions Notice, and thereafter the provisions of Section 4.1(b) shall govern and control, except that any termination shall be governed by Section 8.5 (in lieu of Section 4.2) and the Closing shall be extended as necessary to allow for the response and election periods under Section 4.1(b). In the event Seller does not timely cure one or more of those New Title Exceptions which are deemed to constitute Disapproved Title Exceptions, then Buyer may elect, at any time on or before the Closing Date, to either: (A) continue this Agreement in effect without modification and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to such New Title Exceptions (which will be deemed to constitute "Permitted Title Exceptions"); or (B) terminate this Agreement and the Escrow pursuant to the provisions of Section 8.5(a) hereof, unless such failure is the result of a default by Seller under this Agreement, in which case the provisions of Section 8.6(a) shall govern. Notwithstanding any provision in this Agreement to the contrary, in no event shall the term "Permitted Title Exceptions" include any Monetary Obligations, and Seller hereby agrees to and shall remove all Monetary Obligations on or before the Closing. (d) Physical Inspection. Subject to the limitations set forth in this Section 4.1(d) and as set forth in Section 12(c) of the Existing PSA, during the Investigation Period, Buyer shall have the right, at Buyer's 8

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expense, to make inspections (including tests, surveys and other studies) of the Real Property and all matters relating thereto, including, but not limited to, soils and geologic conditions, location of property lines, utility availability and use restrictions, environmental conditions, the manner or quality of the construction of the Improvements, the habitability, merchantability, marketability, profitability or fitness for a particular purpose of the Real Property, the effect of applicable planning, zoning and subdivision statutes, ordinances, regulations, restrictions and permits, the character and amount of any fees or charges that must be paid to further develop, improve and/or occupy the Real Property and all other matters relating to the Real Property. During the Investigation Period, Buyer and its agents, contractors and subcontractors shall have the right to enter upon the Real Property, at reasonable times during ordinary business hours, to make inspections and tests as Buyer deems reasonably necessary and which may be accomplished without causing any material damage to the Real Property. Buyer shall return and restore the Real Property to substantially its original physical condition immediately prior to such inspections or tests. (e) Investigation of Permits and Entitlements, Contracts, Intangible Property, Personal Property and Other Property. During the Investigation Period, Buyer shall have the right, at Buyer's expense, to conduct and complete an investigation of all matters pertaining to the Permits and Entitlements, Contracts, Intangible Property, Personal Property and all other items of Property and Buyer's acquisition thereof. In this regard, at all times prior to the Closing, Buyer shall have the right to contact governmental officials and other parties and make reasonable inquiries concerning the Permits and Entitlements, Contracts, Intangible Property, Personal Property and all other items of Property, and Buyer shall have no liability whatsoever arising from its investigation. Seller agrees to reasonably cooperate with Buyer in connection with its investigation of the Permits and Entitlements, Contracts, Intangible Property, Personal Property and all other matters pertaining thereto. (f) Investigation of Tenant and Guarantors. During the Investigation Period, Buyer shall have the right, at Buyer's expense, to conduct and complete an investigation of Tenant and Guarantors, including but not limited to discussions with Tenant's and each Guarantor’s management, and diligence relating to Tenant's and each Guarantor’s financial information, business, prospects, compliance with applicable laws and regulations and any other matters that Buyer, in its sole discretion, deems appropriate. In the event Buyer disapproves or finds unacceptable, in Buyer's sole and absolute discretion, any matters reviewed by Buyer during the Investigation Period or for any other reason or no reason, Buyer may elect to terminate this Agreement and the Escrow pursuant to the provisions of Section 4.2 hereof. Section 4.2 Election to Terminate. In the event Buyer desires to terminate this Agreement and the Escrow for any reason or for no reason whatsoever, Buyer may elect to terminate this Agreement and the Escrow at any time: (a) by giving Seller written notice of Buyer's election to terminate this Agreement and the Escrow ("Buyer's Election to Terminate"), not later than 11:00 p.m. Eastern Time on the date of expiration of the Investigation Period; and/or (b) by failing to timely deliver to Seller Buyer's Election Not to Terminate pursuant to Section 4.3 hereof, which failure shall be deemed to constitute Buyer's delivery of Buyer's Election to Terminate this Agreement and the Escrow pursuant to this Section 4.2. Upon any election (including any deemed election) by Buyer to terminate this Agreement and the Escrow pursuant to this Section 4.2, this Agreement shall automatically terminate (other than those provisions which expressly provide that they survive any termination of this Agreement). Within two (2) Business Days after Buyer delivers Buyer's Election to Terminate to Seller pursuant to this Section 4.2 (or within two (2) Business Days after Buyer is deemed to have elected to terminate this Agreement and the Escrow pursuant to this Section 4.2, as applicable), and without the need of any further authorization or consent from Seller, Escrow Agent shall cause to be paid to Buyer the Initial Deposit, together with all interest accrued thereon. Seller and Buyer shall execute such cancellation instructions as may be necessary to effectuate the cancellation of the Escrow, as may be required by Escrow Agent. Any escrow cancellation, title costs (including cancellation costs) or other cancellation costs in connection therewith shall be borne by Seller. Section 4.3 Election Not to Terminate. In the event Buyer desires not to terminate this Agreement and the Escrow, on or before 11:00 p m. Eastern Time on the date of expiration of the Investigation Period, Buyer shall deliver written notice to Seller of Buyer's election not to terminate this Agreement and the Escrow ("Buyer's Election Not to Terminate"). In the event Buyer fails to timely deliver to Seller Buyer's Election Not to Terminate in accordance with the provisions of this Section 4.3, such failure shall be deemed to constitute Buyer's delivery of 9

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Buyer's Election to Terminate this Agreement and the Escrow in accordance with the terms and conditions of Section 4.2 hereof. Section 4.4 Confidentiality; Public Announcements. (a) Buyer's Obligations. Buyer shall treat all of Seller's Deliveries and any other information, materials, data and documents that Seller or any of Seller’s Affiliates provided or made available to Buyer before or after the Effective Date (collectively the “Information”) as confidential and proprietary information of Seller. Buyer shall hold the Information in confidence and shall not disclose any Information to any third parties other than Title Insurer, Escrow Agent and Buyer's attorneys, employees, agents, consultants, contractors, subcontractors, accountants, investors and lenders as deemed reasonably necessary or appropriate by Buyer in Buyer's discretion and only after receiving from each such recipient appropriate assurances that it will comply with the obligations of confidentiality set forth herein regarding such Information. The covenants of Buyer set forth in this Section 4.4 shall not apply to any information that: (a) is, or subsequently becomes, part of the public domain other than as a result of a breach of this Agreement by Buyer; (b) had been previously communicated to Buyer from other sources, without breach of any obligation of confidentiality, at the time of disclosure by Seller to Buyer and such prior communication can be demonstrated by Buyer; and/or (c) is required by law to be disclosed, including applicable securities laws. Nothing contained herein shall preclude Buyer from disclosing all or any portion of such confidential information or materials: (1) pursuant to or in connection with a judicial order, governmental inquiry, subpoena, or other legal process; (2) as necessary or appropriate in connection with a financial or governmental audit; (3) in order to initiate, defend or otherwise pursue legal proceedings between the Parties in connection with this Agreement; and/or (4) in order to initiate, defend or otherwise pursue legal proceedings between Buyer and Owner in connection with the Existing PSA. The covenants and agreements of Buyer set forth in this Section 4.4(a) hereof shall terminate and no longer be of any force or effect as of the Closing, excepting only Information that is comprised, in whole or part, of (i) financial information, documents or data of Seller or any of Seller’s Affiliates and (ii) trade secrets of Seller or any of Seller’s Affiliates. With regard to the items specified in the immediately preceding sentence, the covenants and agreements of Buyer contained in this Section 4.4(a) shall survive the Closing and not be merged into the Seller’s Deed, in the case of items specified in (i), for a period of two (2) years after the Closing, and in the case of items specified in (ii), for so long as such items are actually maintained as trade secrets by Seller. (b) Public Announcements. Neither Party, nor any of its Affiliates, successors or assigns, shall make any public announcements regarding the existence of this Agreement, the terms of this Agreement and/or the transactions contemplated herein without the prior written approval of the other Party, which approval may be granted or withheld in the sole and absolute discretion of such Party. Notwithstanding the foregoing each Party acknowledges and agrees that (1) the other Party may make any required filing of this Agreement and other documents evidencing the transactions contemplated herein, including a description of the material terms thereof, with the Securities and Exchange Commission or the securities regulatory authority for any Province of Canada or any securities exchange in Canada without the prior approval of the other Party; and (2) the other Party make certain disclosures to its investors after the expiration of the Investigation Period in the form of a press release statement, which disclosures will include certain material terms relating to this Agreement and which shall be subject to both Parties’ prior reasonable approval. ARTICLE 5 PRE-CLOSING OBLIGATIONS OF SELLER AND BUYER Section 5.1 Seller's Pre-Closing Obligations. Seller hereby covenants and agrees as follows: (a) Existing PSA. During the time period from the Effective Date to the Closing or earlier termination of this Agreement, (i) Seller shall administer and timely perform all of its obligations under the Existing PSA, and (ii) Seller shall not terminate the Existing PSA or, to the extent it impairs any of Buyer’s rights hereunder, waive any of its rights under the Existing PSA or amend or modify the Existing PSA without the prior consent of Buyer in each instance; provided, however, Seller may amend the Existing PSA in order to accommodate the transaction contemplated by this Agreement, provided that Seller promptly provides a copy of any such amendment to Buyer. Notwithstanding the foregoing, Seller may exercise any and all of its remedies available under the Existing PSA in the event of a default thereunder by Owner, provided Seller shall promptly notify Buyer in writing of any such exercise of Seller’s rights under the Existing PSA and thereafter keep Buyer reasonably apprised of the status of the Existing PSA and Seller’s exercise of any rights thereunder. 10

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(b) Notices/Violations. During the time period from the Effective Date to the Closing or earlier termination of this Agreement, Seller shall promptly deliver to Buyer any and all written notices and/or other written communications delivered by Seller to or received by Seller from: (i) any party under the Existing PSA; and/or (ii) any governmental authority. During the time period from the Effective Date to the Closing or earlier termination of this Agreement, Seller shall promptly deliver to Buyer any and all notices and/or other written communications delivered or received by Seller regarding: (A) the occurrence of any inspections of the Property by any governmental authority; (B) any actual or alleged default by a party to any Contract or the Existing PSA; and/or (C) any notices of violations of laws, ordinances, orders, directives, regulations or requirements issued by, filed by or served by any governmental agency against or affecting Owner, Seller, Tenant, any Guarantor or any part or aspect of the Property. (c) Monetary Obligations. Seller shall pay and satisfy in full (or cause Owner to pay and satisfy in full, as applicable) any and all Monetary Obligations on or before the Closing Date. (d) New Liens, Liabilities or Encumbrances. Seller shall not cause, grant or permit any new liens, liabilities, encumbrances or exceptions to title to the Property or amend any existing title exceptions without the prior written consent of Buyer in each instance, which consent may be granted or denied in the sole and absolute discretion of Buyer. (e) Termination of Negotiations. Seller shall terminate all negotiations with any other Person other than Owner and Buyer for the sale or disposition of the Property. Section 5.2 Assignment of Contract Rights. Upon Buyer’s written request at or after the Closing, to the extent assignable, and to the extent Seller can do so without waiving any of its rights or remedies, Seller shall assign to Buyer all of Seller’s right, title and interest in and to any claims, warranties and other rights and remedies of Seller pursuant to the Existing PSA as it relates to the Property and shall reasonably cooperate with Buyer, at no cost or liability to Seller, to enforce any such contract rights and remedies against Owner or any other rights afforded to Seller at law or in equity pursuant to and in accordance with the terms and conditions of the Existing PSA and applicable laws. Notwithstanding the foregoing assignment, Seller may also retain the right to enforce any such claims, warranties and other rights and remedies of Seller pursuant to the Existing PSA, provided that Seller notify Buyer in advance of any such enforcement action that Seller intends to take against Owner and shall reasonably cooperate with Buyer at Buyer’s request in connection with any such enforcement action taken by Seller against Owner to the extent that Buyer has or may incur any cost, liability or damages as a result of the matters to be addressed in such enforcement action. The covenants and agreements set forth in this Section 5.2 shall survive the Closing. ARTICLE 6 SELLER'S DELIVERIES Section 6.1 Seller's Deliveries to Escrow Agent at Closing. On or before 5:00 p.m. Eastern Time on the last Business Day prior to the Closing Date, Seller shall deliver to Title Insurer (or in the event of a direct transfer pursuant to Section 2.3, cause Owner to deliver pursuant to the Existing PSA) the items described in this Section 6.1. (a) Seller's Deed. One (1) original of Seller's Deed, duly executed and acknowledged by Seller. Pursuant to Section 12.1(a) hereof, all documentary transfer tax information shall be affixed to Seller's Deed after recordation. (b) Certificate of Non-Foreign Status. One (1) original of the Certificate of Non-Foreign Status, duly executed and acknowledged by Seller. (c) Assignment of Permits, Entitlements and Intangible Property.Two (2) counterpart originals of Assignment of Permits, Entitlements and Intangible Property, duly executed by Seller. (d) REA Notice. A copy of a letter from Seller to each party to any reciprocal easement and/or other easement or restrictive agreement which effect the Real Property stating that the Real Property has been sold and that all notices under the such agreement relating to the Real Property should now be addressed to Buyer, if any such agreements require such notice. 11

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(e) Seller's Charges. In addition to the Purchase Price and other funds deposited by Buyer with Escrow Agent, such funds as may be required to: (a) discharge all Monetary Obligations; and (b) pay any amounts required to be paid by Seller in accordance with the provisions of Article 11 hereof, in the form of Cash. (f) Seller's Affidavits; Certificates and Evidence of Authority. (a) Any and all affidavits, indemnifications, lien releases and/or waivers and any other written documentation required by the Title Insurer as a condition to the issuance of the ALTA Extended Coverage Policy; and (b) to the extent required by the Title Insurer, Escrow Agent and/or Buyer, as applicable, evidence that Seller and those acting for Seller have due authority to consummate the transaction contemplated by this Agreement, as modified through the Closing including, without limitation, certified copies of the corporate or other resolutions authorizing the transaction contemplated by this Agreement. (g) Seller's Closing Statement. Seller's Closing Statement, duly executed by Seller. (h) Additional Documents. Such additional documents, instructions or other items as may be necessary or appropriate to comply with the provisions of this Agreement and to effect the transactions contemplated hereby. Section 6.2 Seller's Deliveries to Buyer at Closing. On or before the Closing, Seller shall deliver to Buyer (or in the event of a direct transfer pursuant to Section 2.3, cause Owner to deliver pursuant to the Existing PSA) the items described in this Section 6.2. (a) Permits and Entitlements and Intangible Property. Copies of all of the Permits and Entitlements and Intangible Property in Seller's possession or control. ARTICLE 7 BUYER'S DELIVERIES On or before 12:00 p m. Eastern Time on the Closing Date, Buyer shall deliver to Escrow Agent the items described in this Article 7. Section 7.1 Closing Deposit. The Closing Deposit for the Property pursuant to Section 2.2(c) hereof. Section 7.2 Assignment of Permits, Entitlements and Intangible Property. Two (2) counterpart originals of the Assignment of Permits, Entitlements and Intangible Property, duly executed by Buyer. Section 7.3 Buyer's Charges. In addition to the Purchase Price and other funds deposited by Buyer with Escrow Agent, funds sufficient to pay all amounts required to be paid by Buyer in accordance with the provisions of Article 11 hereof, in the form of Cash. Section 7.4 Buyer's Closing Statement. Buyer's Closing Statement, duly executed by Buyer. Section 7.5 Additional Documents. Such additional documents, instructions or other items as may be necessary or appropriate to comply with the provisions of this Agreement and to effect the transactions contemplated hereby. ARTICLE 8 CONDITIONS TO CLOSING; CLOSING; DEFAULT; REMEDIES Section 8.1 Conditions to Obligations of Buyer. The Closing of the transaction contemplated pursuant to this Agreement and Buyer's obligation to purchase the Property are subject to satisfaction, prior to the Closing Date, of all of the conditions set forth below, the determination of the satisfaction of which shall be made by Buyer, in its sole and absolute discretion. Seller hereby acknowledges and agrees that each of the conditions set forth in this Section 8.1 are for the benefit of Buyer and may only be waived by Buyer in its sole and absolute discretion. 12

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(a) Delivery of Items. Seller shall have timely delivered to Escrow Agent all of the items to be delivered by Seller pursuant to Section 6.1 hereof. Seller shall have timely delivered to Buyer all of the items to be delivered by Seller pursuant to Section 6.2 hereof. (b) Performance of Obligations. Seller shall have timely performed and satisfied all of the obligations under this Agreement to be performed by Seller prior to the Closing, including, without limitation, all of Seller's obligations under Section 5.1 hereof. (c) Title Commitment. Title Insurer is committed to issue an American Land Title Association Owner's Policy of Title Insurance with Extended Coverage (ALTA Form 2006), or its state equivalent, with liability in the amount of the Purchase Price, insuring that fee title to the Real Property is vested in Buyer, subject only to: (i) the exclusions listed in the "Exclusions from Coverage" of the ALTA Extended Coverage Title Policy; and (ii) the Permitted Title Exceptions, together with such endorsements as may be available and reasonably requested by Buyer including, without limitation, the following endorsements, as applicable and available: (i) 3.1 zoning with parking; (ii) comprehensive; (iii) restrictions coverage; (iv) access; (v) survey; (vi) subdivision; (vii) utility facility; (viii) contiguity; (ix) separate tax parcel(s); (x) environmental lien; (xi) mechanics’ lien coverage; and (xii) removal of the arbitration clause (collectively, the "ALTA Extended Coverage Policy"). (d) Representations and Warranties. All of Seller's representations and warranties set forth in this Agreement shall be true and correct in all material respects on the Closing Date as though made at the time of the Closing. Without limiting the foregoing, on or before the Closing Date, Seller shall have delivered to Buyer a written certificate, duly executed by Seller, certifying that all of the representations and warranties of Seller set forth in this Agreement are true and correct as of the Closing. (e) Litigation. No suit, action, claim or other proceeding shall have been instituted or threatened against Owner, Seller, Tenant or any Guarantor which results, or reasonably might be expected to result, in the transactions contemplated by the Existing PSA or this Agreement being enjoined or declared unlawful, in any lien attaching to or against the Property and/or in any liabilities or obligations being imposed upon Buyer or the Property, other than the Permitted Title Exceptions. (f) Bankruptcy. No suit, action, claim or other proceeding shall have been instituted or threatened against Owner, Seller, Tenant or any Guarantor under the U.S. Bankruptcy Code or any state law for relief of debtors or which results, or which reasonably might be expected to result, in the transactions contemplated by the Existing PSA or this Agreement being enjoined or declared unlawful, in any lien attaching to or against the Property or in any new liabilities or obligations being imposed upon Buyer or the Property. (g) Damage or Destruction. Subject to Section 8.3 hereof, there shall have been no Material Loss. (h) Condemnation Proceeding. Subject to Section 8.3 hereof, no Condemnation Proceeding shall have been instituted or be threatened against all or any portion of the Real Property. (i) Termination of Contracts. All of the Contracts that would be binding on Buyer or the Property following the Closing shall have been terminated effective as of a date not later than the Closing Date, and Seller shall have paid all amounts due under such Contracts up to and through the effective date of termination, including, without limitation, any termination fees or similar payments, and neither Buyer nor the Property shall be bound thereby or have any liability or obligations thereunder. (j) Change in Conditions. There shall have been no adverse change with respect to the ownership, operation or occupancy or the physical condition of the Property or any part thereof (subject to Section 8.3 hereof). (k) No Moratorium. No moratorium, statute or regulation of any governmental agency or order or ruling of any court shall have been enacted, adopted or issued after the expiration of the Investigation Period that would adversely affect Buyer's or Tenant’s proposed use or development of the Real Property. 13

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(l) Tenant / Guarantor Condition. From the Effective Date through the Closing Date, there shall not have occurred a change, event, state of facts or development that has had or would reasonably be expected to have, individually or in the aggregate, a material adverse effect on the business, financial condition, prospects, assets or results of operations of Tenant or any Guarantor. (m) Lease Amendment / Guaranty Condition. Buyer shall have received the following: (i) the Lease Amendment, duly executed by Tenant thereunder; and (ii) a written acknowledgment and consent to such Lease Amendment, duly executed by each Guarantor. (n) No Defaults; Concurrent Closing Under Existing PSA. Neither Seller nor Owner shall be in material default of any of their respective obligations under the Existing PSA. The closing of the transaction contemplated in the Existing PSA shall have occurred or shall occur concurrently with the Closing hereunder. Upon any termination of the Existing PSA, Seller shall notify Buyer in writing of such termination and this Agreement shall automatically terminate, in which case the termination provisions set forth in Section 8.5 shall apply, unless such termination was due to a default by Seller under this Agreement, in which case the provisions set forth in Section 8.6 shall apply. Buyer may waive any of the conditions set forth in this Section 8.1 by delivery of written notice to Seller on or before the Closing. Without limiting the foregoing, Escrow Agent shall assume that each of the conditions set forth in Section 8.1(b) shall have been satisfied as of the Closing Date, unless Buyer shall have given written notice to the contrary to Escrow Agent on or before the Closing Date. Section 8.2 Conditions to Obligations of Seller. The Closing of the transactions contemplated pursuant to this Agreement and the obligation of Seller to sell, convey, assign, transfer and deliver the Property to Buyer are subject to satisfaction, prior to the Closing Date, of all of the conditions set forth below, the determination of the satisfaction of which shall be made by Seller, in its sole but reasonable discretion. Buyer hereby acknowledges and agrees that each of the conditions set forth in this Section 8.2 are for the benefit of Seller and may only be waived by Seller in its sole but reasonable discretion. (a) Delivery of Items. Buyer shall have timely delivered to Escrow Agent all of the items to be delivered by Buyer pursuant to Article 7 hereof. (b) Performance of Obligations. Buyer shall have performed all of the obligations of Buyer under this Agreement to be performed by Buyer prior to the Closing. (c) Existing PSA. Owner shall not be in material default of its obligations under the Existing PSA. (d) executed by the Buyer. Lease Amendment Condition. Seller shall have received the Lease Amendment, duly Seller may waive any of the conditions precedent set forth in this Section 8.2 by delivery of written notice thereof to Buyer. Escrow Agent shall assume that each of the conditions set forth in this Section 8.2 shall have been satisfied as of the Closing Date, unless Seller shall have given written notice to the contrary to Escrow Agent on or before the Closing Date. Section 8.3 Casualty; Condemnation Proceeding. (a) Material Loss. In the event that, prior to the Closing, the Real Property shall suffer a Material Loss or Seller shall receive notice of the commencement or the threat of commencement of any eminent domain or condemnation proceeding which involves any portion of the Real Property ("Condemnation Proceeding"), Seller shall immediately notify Buyer of such Material Loss or Condemnation Proceeding and, in such a case: (i) Buyer shall have the right to terminate this Agreement and the Escrow pursuant to the terms of Section 8.5(a) hereof; or (ii) accept the Property in its then-existing condition and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to the terms and conditions described in this Section 8.3. In the event of a Material Loss, if Buyer exercises its right to purchase and acquire the Property in its present condition, then Seller shall pay or assign to Buyer on the Closing any and all casualty insurance proceeds previously paid or payable to 14

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Seller (pursuant to the Existing PSA or otherwise), and Buyer shall be entitled to a credit against the Purchase Price in an amount equal to any insurance deductible, as well as an amount equal to the estimated costs, fees and expenses to repair and/or replace the uninsured portion of the Material Loss. In the event of a Condemnation Proceeding, if Buyer exercises its right to purchase and acquire the Property in its present condition, then Seller shall pay or assign to Buyer on the Closing any amount of compensation, awards or other payments or relief previously paid or payable to Seller (pursuant to the Existing PSA or otherwise) resulting from such Condemnation Proceeding. Buyer's termination right or Buyer's acceptance right shall be exercised by written notice to Seller within thirty (30) Calendar Days (but in no event later than the Closing Date) after Buyer receives written notice from Seller of the occurrence of the Material Loss or Condemnation Proceeding. (b) Non-Material Loss. In the event that, prior to the Closing, the Real Property shall suffer a Non-Material Loss, Seller shall immediately notify Buyer of such Non-Material Loss and, in such a case, Buyer shall be obligated to purchase the Property (in its then-existing condition) in accordance with the terms and conditions of this Agreement, subject to the terms and conditions of this Section 8.3(b). In such a case, Seller shall pay and assign to Buyer on the Closing any and all casualty insurance proceeds previously paid or payable to Seller (pursuant to the Existing PSA or otherwise), and Buyer shall also be entitled to a credit against the Purchase Price in an amount equal to any insurance deductible, as well as an amount equal to the estimated costs, fees and expenses to repair and/or replace the uninsured portion of the Non-Material Loss. In the event such Non-Material Loss is not covered by insurance, then Buyer shall be entitled to an offset against the Purchase Price in an amount equivalent to the monetary value of such Non-Material Loss. Section 8.4 Closing. The closing of the transaction contemplated by this Agreement ("Closing") shall take place at the offices of Escrow Agent or at such other location as may be mutually agreed upon by Seller and Buyer, upon the later of (a) the date that is seven (7) Business Days after the expiration of the Investigation Period or (b) the closing date under the Existing PSA (as the same may be extended pursuant to this Agreement or by mutual written agreement of the parties, the "Closing Date"), provided in no event shall the Closing occur later than October 31, 2021. Section 8.5 Failure of Conditions to Closing; No Default by Seller or Buyer. (a) Failure of Buyer's Closing Conditions. In the event one or more of Buyer's conditions to the Closing set forth in Section 8.1 hereof are not satisfied by Seller or otherwise waived by Buyer on or before the Closing Date, and the failure of such conditions to be satisfied is not a result of a default by Seller or Buyer in the performance of their respective obligations under this Agreement, then Buyer shall have the right to extend the Closing Date for such period of time as reasonably necessary for Seller to satisfy such condition, not to exceed sixty (60) Calendar Days in the aggregate, by giving written notice to Seller. If Buyer does not make such election to extend, or if Buyer makes such election but such condition is not satisfied within such extended period, then Buyer shall have the right to terminate this Agreement and the Escrow by giving written notice of such termination to Seller. Upon any election by Buyer to terminate this Agreement and the Escrow pursuant to this Section 8.5(a), the provisions of Section 8.5(c) hereof shall govern. (b) Failure of Seller's Closing Conditions. In the event one or more of Seller's conditions to the Closing set forth in Section 8.2 hereof are not satisfied by Buyer or otherwise waived by Seller on or before the Closing Date, and the failure of such conditions to be satisfied is not a result of a default by Seller or Buyer in the performance of their respective obligations under this Agreement, then Seller shall have the right to extend the Closing Date for such period of time as reasonably necessary for Buyer to satisfy such condition, not to exceed sixty (60) Calendar Days in the aggregate, by giving written notice to Buyer. If Seller does not make such election to extend, or if Seller makes such election but such condition is not satisfied within such extended period, then Seller shall have the right to terminate this Agreement and the Escrow by giving written notice of termination to Buyer. Upon any election by Seller to terminate this Agreement and the Escrow pursuant to this Section 8.5(b), the provisions of Section 8.5(c) shall govern. (c) Termination Provisions. In the event either party elects to terminate this Agreement and the Escrow for the reasons and in accordance with the provisions set forth in this Section 8.5, then: (i) this Agreement shall automatically terminate (other than those provisions which expressly provide that they survive any termination of this Agreement); (ii) Escrow Agent shall immediately cause the Initial Deposit to be paid to Buyer without the need of any further written authorization or consent from Seller; and (iii) Seller and Buyer shall execute such escrow 15

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cancellation instructions as may be necessary to effectuate the cancellation of the Escrow as may be required by Escrow Agent. Any Escrow cancellation, title cancellation and other cancellation charges shall be borne equally by Seller and Buyer. Section 8.6 Failure of Conditions to Closing; Default by Seller or Buyer. In the event either Seller or Buyer defaults in the performance of any of their respective obligations to be performed prior to the Closing, other than in the case of Buyer's termination pursuant to Sections 4.2 or 8.5(a) hereof, and other than in the case of Seller's termination pursuant to Section 8.5(b) hereof, then the non-breaching party may elect the applicable remedies set forth in this Section 8.6, which remedies shall constitute the sole and exclusive remedies of the non-breaching party with respect to a default by the other party under this Agreement. (a) Remedies of Buyer. In the event Buyer is the non-breaching party, as its sole and exclusive remedy, Buyer may elect to terminate this Agreement and the Escrow by giving Seller written notice describing Seller's default and setting forth Buyer's election to immediately terminate this Agreement and the Escrow. In the event Buyer elects to terminate this Agreement and the Escrow pursuant to Section 8.6(a)(i) hereof, then Escrow Agent shall immediately cause the Initial Deposit to be paid to Buyer without the need of any further authorization or consent from Seller pursuant to the provisions of Section 8.6(d) hereof. Furthermore, in the event Buyer elects to terminate this Agreement and the Escrow pursuant to Section 8.6(a)(i) hereof, Seller shall also reimburse and pay to Buyer an amount equal to all costs, fees and expenses (including legal fees and costs), paid or incurred by Buyer in connection with this Agreement and in connection with its investigation of the Property, such amount in the aggregate not to exceed $75,000. (b) Remedies of Seller. In the event Seller is the non-breaching party, as Seller's sole and exclusive remedy, Seller may elect to terminate this Agreement and the Escrow by giving Buyer written notice describing Buyer's default and setting forth Seller's election to immediately terminate this Agreement and the Escrow. In the event Seller elects to terminate this Agreement and the Escrow pursuant to this Section 8.6(b) after expiration of the Investigation Period, the sole and exclusive remedy of Seller for such breach shall be to receive the amount specified as liquidated damages pursuant to Section 8.6(c) hereof. Notwithstanding any provision to the contrary set forth in this Agreement, under no circumstance shall Seller be entitled to pursue the equitable remedy of specific performance in the event that Buyer fails to complete the purchase of the Property in accordance with the terms and conditions of this Agreement. (c) SELLER'S LIQUIDATED DAMAGES.IF BUYER FAILS TO COMPLETE THE PURCHASE OF THE PROPERTY IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS AGREEMENT AFTER EXPIRATION OF THE INVESTIGATION PERIOD (OTHER THAN AS A RESULT OF BUYER'S ELECTION TO TERMINATE PURSUANT TO SECTIONS 4.2, 8.5(a) OR 8.6(a) HEREOF, AND OTHER THAN IN THE CASE OF SELLER'S TERMINATION PURSUANT TO SECTION 8.5(b) HEREOF), BY REASON OF THE DEFAULT OF BUYER, SELLER SHALL BE RELEASED FROM ITS OBLIGATION TO SELL THE PROPERTY TO BUYER. IN SUCH A CASE, SELLER AND BUYER AGREE THAT IT WOULD BE DIFFICULT OR IMPOSSIBLE TO DETERMINE THE AMOUNT OF DAMAGES OF SELLER AS A RESULT OF ANY SUCH BREACH BY BUYER, AND, ACCORDINGLY, AS SELLER'S SOLE AND EXCLUSIVE REMEDY AT LAW OR IN EQUITY (OTHER THAN AN ACTION TO ENFORCE THE PROVISIONS OF THIS AGREEMENT), SELLER SHALL BE ENTITLED TO RECEIVE AND RETAIN THE INITIAL DEPOSIT AS LIQUIDATED DAMAGES IN THE EVENT OF A DEFAULT BY BUYER, AND THE PAYMENT OF SUCH LIQUIDATED DAMAGES TO SELLER SHALL CONSTITUTE THE EXCLUSIVE REMEDY OF SELLER ON ACCOUNT OF THE DEFAULT BY BUYER. SELLER'S INITIALS BUYER'S INITIALS (d) Termination Provisions. In the event either Party elects to terminate this Agreement and the Escrow for the reasons and in accordance with the provisions set forth in this Section 8.6, then: (i) this Agreement will automatically terminate (other than those provisions which expressly provide that they survive any termination of this Agreement) without any further acts of either Seller or Buyer; (ii) Seller and Buyer shall execute such escrow cancellation instructions as may be necessary to effectuate the cancellation of the Escrow as may be required by Escrow Agent; and (iii) Escrow Agent shall immediately cause the Initial Deposit and the Independent Consideration 16

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cancellation instructions as may be necessary to effectuate the cancellation of the Escrow as may be required by Escrow Agent. Any Escrow cancellation, title cancellation and other cancellation charges shall be borne equally by Seller and Buyer. Section 8.6 JFailure of Conditions to Closing; Jl)efaull by Seller or Buyer. In the event either Seller or Buyer defaults in the performance of any of their respective obligations to be performed prior to the Closing, other than in the case of Buyer's termination pursuant to Sections 4.2 or 8.5(a) hereot; and other than in the case of Seller's termination pursuant to Section 8.5Cbl hereof, then the non-breaching party may elect the applicable remedies set forth in this Section 8.6, which remedies shall constitute the sole and exclusive remedies of the non-breaching party with respect to a default by the other party under this Agreement. (a) Remedies ofBuyer. In the event Buyer is the non-breaching party, as its sole and exclusive remedy, Buyer may elect to terminate this Agreement and the Escrow by giving Seller written notice describing Seller's default and setting forth Buyer's election to inunediately terminate this Agreement and the Escrow. In the event Buyer elects to terminate this Agreement and the Escrow pursuant to Section 8.6(a)(i) hereof, then Escrow Agent shall inunediately cause the Initial Deposit to be paid to Buyer without the need of any further authorization or consent from Seller pursuant to the provisions of Section 8.6(d) hereof. Furthermore, in the event Buyer elects to terminate this Agreement and the Escrow pursuant to Section 8.6(a)(i) hereof, Seller shall also reimburse and pay to Buyer an amount equal to all costs, fees and expenses (including legal fees and costs), paid or incurred by Buyer in connection with this Agreement and in connection with its investigation of the Property, such amount in the aggregate not to exceed $75,000. (b) Remedies of Seller. In the event Seller is the non-breaching party, as Seller's sole and exclusive remedy, Seller may elect to terminate this Agreement and the Escrow by giving Buyer written notice describing Buyer's default and setting forth Seller's election to immediately terminate this Agreement and the Escrow. In the event Seller elects to terminate this Agreement and the Escrow pursuant to this Section 8.6(b) after expiration of the Investigation Period, the sole and exclusive remedy of Seller for such breach shall be to receive the amount specified as liquidated damages pursuant to Section 8.6(cl hereof. Notwithstanding any provision to the contrary set forth in this Agreement, under no circumstance shall Seller be entitled to pursue the equitable remedy of specific performance in the event that Buyer fails to complete the purchase of the Property in accordance with the terms and conditions of this Agreement. (c) SELLER'S LIQUIDATED DAMAGES.IF BUYER FAILS TO COMPLETE THE PURCHASE OF THE PROPERTY IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS AGREEMENT AFTER EXPIRATION OF THE INVESTIGATION PERIOD (OTHER THAN AS A RESULT OF BUYER'S ELECTION TO TERMINATE PURSUANT TO SECTIONS 4.2, 8.5(a) OR 8.6(a) HEREOF, AND OTHER THAN IN THE CASE OF SELLER'S TERMINATION PURSUANT TO SECTION 8.5(bl HEREOF), BY REASON OF THE DEFAULT OF BUYER, SELLER SHALL BE RELEASED FROM ITS OBLIGATION TO SELL THE PROPERTY TO BUYER. IN SUCH A CASE, SELLER AND BUYER AGREE THAT IT WOULD BE DIFFICULT OR IMPOSSIBLE TO DETERMINE THE AMOUNT OF DAMAGES OF SELLER AS A RESULT OF ANY SUCH BREACH BY BUYER, AND, ACCORDINGLY, AS SELLER'S SOLE AND EXCLUSIVE REMEDY AT LAW OR IN EQUITY (OTHER THAN AN ACTION TO ENFORCE THE PROVISIONS OF THIS AGREEMENT), SELLER SHALL BE ENTITLED TO RECEIVE AND RETAIN THE INITIAL DEPOSIT AS LIQUIDATED DAMAGES IN THE EVENT OF A DEFAULT BY BUYER, AND THE PAYMENT OF SUCH LIQUIDATED DAMAGES TO SELLER SHALL CONSTITUTE THE EXCLUSIVE REMEDY OF SELLER ON ACCOUNT OF THE DEFAULT BY BUYER. SELLER'S INITIALS BUYER'S INITIALS (d) Termination Provisions. In the event either Party elects to terminate this Agreement and the Escrow for the reasons and in accordance with the provisions set forth in this Section 8.6, then: (i) this Agreement will automatically terminate (other than those provisions which expressly provide that they survive any termination of this Agreement) without any further acts of either Seller or Buyer; (ii) Seller and Buyer shall execute such escrow cancellation insttuctions as may be necessary to effectuate the cancellation of the Escrow as may be required by Escrow Agent; and (iii) Escrow Agent shall immediately cause the Initial Deposit and the Independent Consideration 16

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to be distributed and paid in accordance with the provisions of this Agreement. The breaching party hereunder shall pay any and all escrow and title cancellation costs incurred in connection herewith. (e) Cure period for Breach. Except as otherwise provided herein, neither Seller nor Buyer may exercise any right or remedy available to it for a breach of the other party’s obligations unless and until (i) it notifies the other Party of such breach, and (ii) the other Party does not cure such breach within five (5) Business Days thereafter. For avoidance of doubt, this Section 8.6(e) shall not apply to Buyer’s obligation to make the Initial Deposit. (f) Survival. The provisions of this Article 8 shall survive the Closing or any termination of this Agreement. ARTICLE 9 REPRESENTATIONS AND WARRANTIES OF SELLER In addition to the representations, warranties and covenants of Seller contained elsewhere in this Agreement, Seller hereby makes the following representations and warranties, each of which is material and being relied upon by Buyer and shall be true as of the date hereof and as of the Closing: Section 9.1 Organization, Power and Authority. Seller is a limited liability company duly organized and validly existing under the laws of New York. Seller has all requisite power and authority to acquire the Property pursuant to the Existing PSA, to execute and deliver this Agreement and the Transaction Documents to which Seller is a party, and to perform its obligations hereunder and thereunder and effect the transactions contemplated hereby and thereby. All requisite limited liability company, partnership or other action has been taken to authorize and approve the execution, delivery and performance by Seller of this Agreement and the Transaction Documents to which Seller is a party. Section 9.2 No Conflicts. The execution, delivery and performance by Seller of this Agreement and the Transaction Documents to which Seller is a party, and the consummation of the transactions contemplated hereby and thereby, will not: (a) violate any provision of the organizational documents of Seller; (b) violate, conflict with or result in a breach of or default under any term or provision of any contract or agreement to which Seller is a party or by or to which Seller or any of its assets or properties are or may be bound or subject; or (c) violate any order, judgment, injunction, award or decree of any court or arbitration body, or any governmental, administrative or regulatory authority, or any other body, by or to which Seller or the Property are or may be bound or subject. Section 9.3 1445 of the Code. Non-Foreign Status. Seller is not a "foreign person" as such term is defined in Section Section 9.4 Litigation and Condemnation. Seller has not received written notice of and, to the best of Seller's knowledge and belief, there are no: (a) pending or threatened claims, actions, suits, arbitrations, proceedings (including condemnation proceedings) or investigations by or before any court or arbitration body, any governmental, administrative or regulatory authority, or any other body, against or affecting the Property or the transactions contemplated by the Existing PSA or this Agreement; and (b) orders, judgments or decrees of any court or arbitration body, any governmental, administrative or regulatory authority, or any other body, against or affecting the Property or the transactions contemplated by the Existing PSA or this Agreement. Section 9.5 Liabilities. To the best of Seller’s knowledge, upon the Closing, neither Buyer nor the Property will be subject to any liabilities or obligations, whether secured, unsecured, accrued, absolute, contingent or otherwise, that relate to the ownership of the Property prior to the Closing, other than the Permitted Title Exceptions. Seller has not received written notice that the Property is in violation of any easement, covenant, condition, restriction or similar provision in any instrument of record or other unrecorded agreement affecting the Property, nor, to the best of Seller’s knowledge, does any such violation exist. Section 9.6 Fees. To the best of Seller’s knowledge, there are no impact, mitigation or similar fees owing or payable in connection with the construction, development, installation and/or operation of the Real Property. Section 9.7 Mechanic's Liens. As of the Closing, to the best of Seller’s knowledge, there will not be any fees, dues or other charges which are due, owing or unpaid in connection with the construction of or any repairs 17

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to the Real Property. To the best of Seller’s knowledge, there are no pending or threatened claims which may or could ripen with the passage of time into a mechanic's lien upon the Real Property as the result of any contract, agreement or work performed on the Real Property. Section 9.8 Taxes and Assessments. To the best of Seller’s knowledge and except as otherwise disclosed in Seller’s Deliveries, there are no pending or threatened improvements, liens, or special assessments made or to be made against the Property by any governmental authority. Section 9.9 Construction and Condition of Improvements. To the best of Seller’s knowledge and belief and except as otherwise disclosed in Seller’s Deliveries, there are no material, latent defects in any of the Improvements, if any. Section 9.10 Contracts. To the best of Seller’s knowledge and belief, there are no Contracts with any person or entity relating to the Property which must be assumed by Buyer (or which will be deemed assumed by the Buyer upon the Buyer becoming the owner of the Property), other than the Permitted Title Exceptions. Section 9.11 Financial Statements; Books and Records. Each of the financial statements of Tenant and each Guarantor provided to Buyer pursuant to Section 4.1(a) hereof: (i) is in accord with the books and records of Tenant or such Guarantor, as the case may be; (ii) presents fairly, completely and accurately the results of operations for the respective periods covered thereby; and (iii) is prepared in accordance with generally accepted accounting principles. Section 9.12 Compliance with Laws. To the best of Seller’s knowledge and belief, Owner and Seller are each currently in compliance in all material respects with all federal (except solely with respect to any federal law that directly conflicts with state and local cannabis laws, regulations and ordinances), state and local laws, regulations and ordinances applicable to the development, ownership, operation, maintenance and management of the Real Property, and/or otherwise applicable to Owner or Seller, including, without limitation, all laws, regulations and ordinances relating to zoning, planning, land use and building restrictions, construction, Environmental Laws, subdivision, fire, health and safety, disability, alcoholic beverage sales and the cultivation, processing, storing and distributing of cannabis, cannabis-infused products and materials derived from or used in the cultivation, processing, storing and distribution of cannabis. To the best of Seller’s knowledge and belief, the Real Property is in compliance with all applicable laws, ordinances, rules and regulations (including without limitation those relating to zoning and the requirements of Title III of the Americans with Disabilities Act of 1990 (42 U.S.C. 12181, et seq., the Provisions Governing Public Accommodations and Services Operated by Private Entities), and all regulations promulgated thereunder, and all amendments, revisions or modifications thereto), and Seller has not received written notice of any violation of any such laws, rules or regulations. Seller has not received any written notice nor does Seller have knowledge of any investigation that has been commenced or is contemplated respecting any such failure of compliance with applicable laws, ordinances, rules and regulations. Section 9.13 Environmental Matters. To the best of Seller's knowledge and belief, and except as may otherwise be disclosed in Seller’s Deliveries or the reports listed on Schedule 2.0 attached hereto and incorporated herein by reference: (i) the Improvements are free from Hazardous Materials; (ii) the soil, surface water and ground water of, under, on or around the Real Property are free from Hazardous Materials; and (iii) the Real Property has never been used for or in connection with the manufacture, refinement, treatment, storage, generation, disposal, transport, or hauling of any Hazardous Material in violation of applicable Environmental Laws. Section 9.14 Permits and Entitlements. To the best of Seller’s knowledge and belief, any Permits and Entitlements required to be held by Buyer or Tenant, respectively, from and after the Closing for the ownership, operation, maintenance and management of the Property are, or as of the Closing Date will be, in full force and effect. [As of the Closing,] Tenant is permitted under all applicable laws (except solely with respect to any federal law that directly conflicts with state and local cannabis laws, regulations and ordinances) and has all necessary state and local licenses and authorizations to cultivate and process cannabis plant parts and resins into products and store the same for transport, and such state and local licenses and authorizations are in full force and effect. Section 9.15 Dependent Properties. To the best of Seller’s knowledge and belief, the continued maintenance, occupancy and operation of the Real Property is not now, and on the Closing Date will not be, dependent to any extent on improvements or facilities located at any other property, and the continued maintenance, occupancy 18

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and operation of any other property is not dependent to any extent on improvements or facilities located on the Real Property (including, but not limited to, the Improvements or the Personal Property). Section 9.16 Prohibited Persons and Transactions. Neither Seller, nor any of its Affiliates, nor any of their respective members or partners, and none of their respective officers or directors is, nor prior to Closing, or the earlier termination of this Agreement, will they become, a person or entity with whom U.S. persons or entities are restricted from doing business under the regulations of the Office of Foreign Asset Control ("OFAC") of the Department of the Treasury (including those named on OFAC's Specially Designated Blocked Persons List) or under any U.S. statute, executive order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit or Support Terrorism), or other governmental action and is not, and prior to Closing or the earlier termination of this Agreement will not, engage in any dealings or transactions with or be otherwise associated with such persons or entities. Section 9.17 Integrity of Documents. To the best of Seller’s knowledge, Seller has furnished to Buyer all items constituting Seller's Deliveries and all of the information contained in Seller's Deliveries is true and correct and contains no misrepresentations or omissions of facts. To the best of Seller’s knowledge, the information contained in the attached Exhibits and Schedules is true and correct in all respects and contains no misrepresentations or omissions of facts. The representations and warranties of Seller contained in this Agreement are true and correct in all respects and contain no misrepresentations or omissions of facts. Section 9.18 Options to Purchase; Occupancy Rights. Seller has not previously granted any option to purchase the Property or any right of first refusal or similar rights with respect to the Property, and to the best of Seller's knowledge, no such options to purchase or rights of first refusal with respect to the Property are in existence. Seller has not entered into, and has no knowledge, of any lease or similar occupancy agreement with respect to the Real Property that will be binding upon Buyer or the Real Property as of the Closing, except for the Lease to be executed by Tenant and delivered by Seller pursuant to this Agreement. Section 9.19 Existing PSA. The Existing PSA is in full force and effect and to the best of Seller’s knowledge, there are no defaults and no event has occurred which with the giving of notice or the passage of time or both would result in a default thereunder. Section 9.20 Survival. The representations and warranties of Seller set forth in Sections 9.1, 9.2 and 9.17 hereof, as well as the right and ability of Buyer to enforce the same and/or to seek damages for its breach, shall survive the Closing. The representations and warranties of Seller set forth in Sections 9.3 through 9.16, inclusive, and Sections 9.18 and 9.19, as well as the right and ability of Buyer to enforce the same and/or to seek damages for their breach, shall survive the Closing for a period of nine (9) months. All claims, whether known or unknown, for breach by Seller of a representation or warranty as set forth in Sections 9.3 through 9.16, inclusive, hereof, and Sections 9.18 and 9.19, must be asserted in writing by Buyer and delivered to Seller on or before the expiration of such nine (9) month period or otherwise such claims shall be invalid and of no force or effect and Seller shall have no liability with respect thereto. Section 9.21 Seller's Representations and Warranties; Reimbursement for Due Diligence Costs. The continued accuracy in all material respects of the aforesaid representations and warranties is a condition precedent to Buyer's obligation to close. If any of said representations and warranties are not correct in all respects at the time the same is made or as of Closing and Seller had no knowledge of such inaccuracy when the representation or warranty was made (or when deemed remade at Closing) or if such warranty or representation becomes inaccurate on or prior to Closing other than by reason of Seller's default hereunder, Buyer may, upon being notified in writing by Seller of such occurrence on or prior to Closing, either: (a) terminate this Agreement and Escrow pursuant to the provisions of Section 8.5(a) hereof; or (b) waive such matter and proceed to Closing. If any of said representations and warranties are not correct in all respects at the time the same is made or as of Closing, and Seller had knowledge of such inaccuracy when the representation or warranty was made, or, by its default hereunder caused the representation or warranty to be inaccurate when deemed remade at Closing, Buyer may either: (i) terminate this Agreement pursuant to the provisions of Section 8.6(a) and recover from Seller all of Buyer's reasonable out-of-pocket legal and due diligence costs incurred in connection with this Agreement and its review of the Property, such amount in the aggregate not to exceed $75,000; or (ii) waive such matter and proceed to Closing. 19

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ARTICLE 10 REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF BUYER Buyer hereby makes the following representations and warranties, each of which representation and warranty is: (a) material and being relied upon by Seller; and (b) true, complete and not misleading in all material respects as of the date hereof and as of the Closing. Section 10.1 Organization, Power and Authority. Buyer is a limited liability company duly organized and validly existing under the laws of the State of Delaware. Subject only to obtaining certain internal approvals on or before the expiration of the Investigation Period, (a) Buyer has all requisite power and authority to execute and deliver this Agreement and the Transaction Documents to which Buyer is a party, and to perform its obligations hereunder and thereunder and to effect the transactions contemplated hereby and thereby and (b) all requisite corporate or other action has been taken to authorize and approve the execution, delivery and performance by Buyer of this Agreement and the Transaction Documents to which Buyer is a party. Section 10.2 No Conflicts. The execution, delivery and performance by Buyer of this Agreement and the Transaction Documents to which Buyer is a party, and the consummation of the transactions contemplated hereby and thereby, will not: (a) violate any provision of Buyer's organization documents; (b) violate, conflict with or result in a breach of or default under any term or provision of any contract or agreement to which Buyer is a party or by or to which Buyer or any of its assets or properties are or may be bound or subject; or (c) violate any order, judgment, injunction, award or decree of any court or arbitration body, or any governmental, administrative or regulatory authority, or any other body, by or to which Buyer is or may be bound or subject. Section 10.3 Survival. The representations, warranties, covenants and agreements contained in this Agreement by Buyer are true, correct and complete and shall be deemed remade by Buyer as of the Closing, with the same force and effect as if made at that time. All representations, warranties, covenants and agreements of Buyer contained in this Article 10, as well as the right and the ability of Seller to enforce them and/or seek damages for their breach, shall survive the Closing for a period of nine (9) months. All claims, whether known or unknown, for breach by Buyer of a representation or warranty as set forth in this Article 10 must be asserted in writing by Seller and delivered to Buyer on or before the expiration of such nine (9) month period or otherwise such claims shall be invalid and of no force or effect and Buyer shall have no liability with respect thereto. ARTICLE 11 COSTS, EXPENSES AND PRORATIONS Section 11.1 Costs and Expenses. (a) Seller. Seller shall pay: (i) all recording costs, documentary transfer taxes, deed stamps and similar costs, fees and expenses payable in connection with the recordation of Seller's Deed; (ii) the cost for the ALTA Extended Coverage Policy and any endorsements thereto requested by Buyer; (iii) the cost of the Survey; (iv) one-half (1/2) of Escrow Agent's fees and costs for the Escrow; (v) Seller’s share of prorations; and (vi) Seller's attorneys' fees. (b) Buyer. Buyer shall pay: (i) one-half (1/2) of Escrow Agent's fees and costs for the Escrow; (ii) Buyer’s share of prorations; and (iii) Buyer's attorneys' fees. Section 11.2 Prorations, Costs and Expenses. (a) The following adjustments and prorations shall be made as of 12:01 a m. on the Closing Date ("Proration Date"), as though Buyer held title to the Property throughout the entire day in which the Closing occurs. Such adjustments and prorations shall be made on the basis of a 365-day year with respect to Taxes as provided in Section 11.2(a)(i) hereof, subject to the following provisions: (i) Real and Personal Property Taxes. All general and special real and personal property taxes and assessments (collectively, the "Taxes"), based on the regular tax bill for the current fiscal year (or, 20

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if such tax bill has not been issued as of the date of the Closing, the regular tax bill for the fiscal year preceding the current fiscal year) shall be prorated between Seller and Buyer at the Closing as of the Proration Date. (ii) Seller’s Obligations. The Parties acknowledge and agree that in furtherance of the provisions of Section 2.3 with respect to the direct transfer of the Property from Owner to Buyer, Escrow Agent may prorate Taxes pursuant to Sections 11.2(a)(i) hereof directly between Owner and Buyer, rather than Seller and Buyer. (iii) Tenant’s Obligations. The Parties acknowledge and agree that the Tenant under the Lease will be responsible for all expenses arising out of the Property subsequent to Closing, including all Taxes that are Buyer’s obligation pursuant to Section 11.2(a), and any such Taxes chargeable to Buyer at Closing shall be paid or reimbursed by Tenant through Escrow at Closing. (b) Final Accounting. Seller and Buyer acknowledge and agree that, on the Closing Date, Seller and Buyer may not have sufficient information to conduct and complete a final proration of all items subject to proration pursuant to this Section 11.2. Accordingly, Seller and Buyer agree that, as soon as is reasonably practicable after the Closing Date, Seller and Buyer shall make a final accounting of all items relating to the Property to be prorated between Seller and Buyer pursuant to this Section 11.2. Seller further agrees that notwithstanding the fact that Taxes may be prorated directly between Owner and Buyer at Closing, Seller shall remain responsible for all Taxes that are Seller’s obligation pursuant to this Section 11.2, provided that Seller may seek reimbursement from Owner for any such amounts required to be paid by Seller after the Closing pursuant to the provisions of the Existing PSA. (c) Other Costs and Operating Expenses. All speculative builder taxes, sales taxes, excise taxes, use and utility charges, development fees, impact fees, mitigation fees, association fees or charges due for other services, materials or labor furnished to or with respect to the Property before Closing shall be paid by Seller (or Seller shall cause Owner to pay pursuant to the Existing PSA) on or before the Closing. ARTICLE 12 ACTIONS TO BE TAKEN AT THE CLOSING Section 12.1 Actions by Title Insurer or Escrow Agent. In connection with the Closing, Escrow Agent or Title Insurer, as applicable, shall take the following actions: (a) Recording. Title Insurer shall cause the Seller's Deed (with documentary transfer tax information to be affixed after recording) to be recorded in the Official Records of Fulton County, New York, and obtain a conformed copy thereof for distribution to Seller and Buyer: (b) Title Policy. Title Insurer shall issue the ALTA Extended Coverage Title Policy to Buyer. (c) Distribution of Funds. Escrow Agent shall disburse all funds deposited with Escrow Agent by Buyer in payment of the Purchase Price as follows: (i) first, deduct, pay and satisfy all items chargeable to the account of Seller pursuant to Section 11.1 hereof; (ii) second, deduct, pay and satisfy all Monetary Obligations against the Real Property; (iii) third, if, as a result of the prorations and credits pursuant to Article 11 hereof, amounts are to be charged to the account of Seller, deduct the net amount of such charges; and (iv) fourth, disburse the remaining balance of the Purchase Price to Seller promptly upon the Closing. All disbursements by Escrow Agent shall be by wire transfer of immediately available funds to the designated account of the receiving party or shall be by certified or cashier's check of Escrow Agent, as may be directed by the receiving party. (d) Distribution of Documents to Seller. Title Insurer shall disburse to Seller: (i) counterpart copies of each of the non-recordable Transaction Documents; (ii) a conformed copy of each of the recordable Transaction Documents, including, without limitation, Seller's Deed; and (iii) any other documents deposited into Escrow by Seller. (e) Distribution of Documents to Buyer. Title Insurer shall disburse to Buyer: (i) counterpart copies of each of the non-recordable Transaction Documents; (ii) a conformed copy of each of the recordable Transaction Documents; and (iii) a copy of all other documents deposited into Escrow by Buyer. 21

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ARTICLE 13 BROKERS Seller and Buyer hereby represent and warrant to each other that the warranting party has not entered into nor will such warranting party enter into any agreement, arrangement or understanding with any other person or entity which will result in the obligation of the other party to pay any finder's fee, commission or similar payment in connection with the transactions contemplated by this Agreement. Seller and Buyer hereby agree to and shall indemnify, defend and hold harmless the other from and against any and all claims, costs, damages and/or liabilities arising from the breach of the foregoing representation by either Seller or Buyer, as the case may be. ARTICLE 14 INDEMNIFICATION Section 14.1 Indemnification. (a) Indemnification by Seller. Seller hereby agrees to and shall reimburse, indemnify, defend (at Buyer's option and with counsel reasonably acceptable to Buyer) and hold harmless Buyer and its affiliates and each of their respective officers, directors, shareholders, members, partners, agents, employees, successors and assigns (collectively, the "Buyer Indemnitees"), from and against any and all claims, liabilities, causes of action, losses, costs, damages, attorneys' fees, judgments and/or expenses ("Losses"), arising out of, or relating to, the following matters: (a) the breach by Seller of any of the representations, warranties and/or covenants made by Seller in or under this Agreement or any of the Transaction Documents; (b) the breach or default in the performance by Seller of any of the covenants or obligations to be performed by Seller under this Agreement or the Transaction Documents; and (c) any claims, liabilities or obligations of Seller, whether accrued, absolute, contingent or otherwise, arising out of or relating to, Seller's entry onto, investigations of or the procurement of any entitlements relating to the development of the Property, which accrued prior to Closing. (b) Buyer Indemnification. Buyer hereby agrees to and shall reimburse, indemnify, defend (at Seller’s option and with counsel reasonably acceptable to Seller) and hold harmless Seller and its affiliates and each of their respective officers, directors, shareholders, members, partners, agents, employees, successors and assigns (collectively, the “Seller Indemnitees”), from and against any and all Losses arising out of, or relating to, the following matters: (i) the breach by Seller of any of the representations, warranties and/or covenants made by Seller in or under this Agreement or any of the Transaction Documents; and (ii) the breach or default in the performance by Buyer of any of the covenants or obligations to be performed by Buyer under this Agreement or the Transaction Documents. Section 14.2 Notice and Opportunity to Defend. (a) Notice of Asserted Liability.Following the receipt by one or more of the Buyer Indemnitees or Seller Indemnitees, as applicable (hereinafter, the “Indemnitees”), of written notice of any claims, liabilities, causes of action or any other circumstances that would give rise to a claim for reimbursement or indemnification pursuant to Section 14.1 of this Agreement (“Asserted Liability”), Indemnitees shall give written notice thereof (“Claims Notice”) to Buyer or Seller, as applicable (hereinafter, the “Indemnitor”). Following the receipt of a Claims Notice, and without in any way limiting or reducing the obligations of Indemnitor pursuant to Section 14.1 hereof, Indemnitor shall defend (at Indemnitee’s option and with counsel reasonably acceptable to Indemnitee) and satisfy such Asserted Liability. All costs, fees and expenses incurred in connection with the defense and satisfaction of such Asserted Liability shall be borne by and be the sole responsibility of Indemnitor. (b) Opportunity to Defend. Without in any way limiting or reducing the obligations of Indemnitor pursuant to Section 14.1 or Section 14.2(a) hereof, Indemnitees may elect to defend (by their own counsel), compromise and/or satisfy any Asserted Liability. Without in any way limiting or reducing the obligations of Indemnitor pursuant to Section 14.1 or Section 14.2(a) hereof, if Indemnitees elect to defend (by their own counsel), compromise and/or satisfy such Asserted Liability, Indemnitees shall notify Indemnitor of Indemnitees’ intent to do so, and Seller shall cooperate in the defense, compromise and satisfaction of such Asserted Liability. All costs, fees and expenses incurred in connection with the defense, compromise and satisfaction of any such Asserted Liability shall be borne by and shall be the responsibility of Indemnitor. Furthermore, and without limiting the obligations of 22

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Indemnitor pursuant to Section 14.1 or Section 14.2(a) hereof, Indemnitor shall reimburse Indemnitees for all Losses incurred by Indemnitees in connection with any such Asserted Liability. (c) Timing for Payment. In the event Indemnitees incur any Losses which were not otherwise paid or satisfied by Indemnitor pursuant to this Agreement, Indemnitees shall deliver written notice to Indemnitor advising Indemnitor that Indemnitees have incurred such Losses (“Notice of Loss”). The Notice of Loss shall include an itemization of all of the Losses which Indemnitor is required to pay pursuant to and in accordance with the terms and provisions of this Agreement. Within thirty (30) calendar days after the date of receipt by Seller of the Notice of Loss, Indemnitor shall pay to Indemnitees the aggregate amount of the Losses described in such Notice of Loss. In the event Indemnitor fails to timely pay to Indemnitees the aggregate amount of such Losses, any and all unpaid amounts shall bear interest at the greater of: (a) eighteen percent (18%) per annum; or (b) the maximum rate of interest allowable under applicable law, which interest, in either case, shall be deemed to accrue effective as of the date such payment was originally due. ARTICLE 15 MISCELLANEOUS Section 15.1 Assignment. No assignment of this Agreement or Buyer's rights or obligations hereunder shall be made by Buyer without first having obtained Seller's written approval of any such assignment, which approval may be granted or withheld in the sole and absolute discretion of Seller. Notwithstanding the foregoing, Buyer may assign this Agreement to either: (a) an affiliate of Buyer; or (b) to a tenancy in common structure in which Buyer or one or more of its affiliates are the sponsor, in each case without the prior written consent of Seller. Buyer shall notify Seller of any such permitted assignment no later than seven (7) Business Days prior to the Closing Date. Upon any such assignment, Buyer shall be fully released and discharged from any and all liabilities and obligations under this Agreement as of the Closing to the extent assignee agrees to all of Buyer’s obligations under this Agreement. Section 15.2 Notices. Except as otherwise stated in this Agreement, any notice, consent, demand, invoice, statement or other communication required or permitted to be given under this Agreement shall be in writing and shall be given by (a) personal delivery, (b) overnight delivery with a reputable international overnight delivery service, such as FedEx, or (c) facsimile or email transmission, so long as such transmission is followed within one (1) Business Day by delivery utilizing one of the methods described in (a) or (b) or the recipient otherwise confirms receipt. Any such notice, consent, demand, invoice, statement or other communication shall be deemed delivered (x) upon receipt, if given in accordance with subsection (a); (y) one (1) Business Day after deposit with a reputable international overnight delivery service, if given if given in accordance with subsection (b); or (z) upon transmission, if given in accordance with subsection (c). Any notice, consent, demand, invoice, statement or other communication required or permitted to be given under this Agreement shall be addressed to the Parties at the following addresses: (i) Seller's Address. If to Seller, at the following address: Vireo Health of New York, LLC 207 S. 9th Street Minneapolis, MN 55402 Attn: Michael Schroeder, General Counsel Telephone: (612) 999-1606 Email: michaelschroed@vireohealth.com (ii) Buyer's Address. If to Buyer, at the following address: IIP-NY 2 LLC 11440 West Bernardo Court, Suite 100 San Diego, California 92127 Attn: Brian Wolfe, General Counsel Telephone: (858) 997-3332 Email: brian.wolfe@iipreit.com 23

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Either Party may, by notice to the other given pursuant to this Section 15.2, specify additional or different addresses for notice purposes. The Parties agree that the attorney for a Party listed above shall have the authority to deliver notices on such Party's behalf. Section 15.3 Entire Agreement. This Agreement, including the Exhibits and Schedules referred to herein, are intended by the Parties to be the final, complete and exclusive expression of their agreement with respect to the terms that are included in this Agreement, and may not be contradicted or supplemented by evidence of any other prior or contemporaneous agreement. This Agreement supersedes all previous representations, arrangements, agreements and understandings by and among the Parties with respect to the subject matter covered by this Agreement including, without limitation, all prior letters of intent executed between Buyer and Seller, and any such representations, arrangements, agreements and understandings are hereby canceled and terminated in all respects. Section 15.4 Amendment. No provision of this Agreement may be modified, amended, or supplemented except by an agreement in writing signed by Buyer and Seller. Section 15.5 Severability. Any provision of this Agreement that shall prove to be invalid, void or illegal shall in no way affect, impair or invalidate any other provision hereof, and all other provisions of this Agreement shall remain in full force and effect and shall be interpreted as if the invalid, void or illegal provision did not exist. Section 15.6 Remedies.No waiver of any term, covenant or condition of this Agreement shall be binding unless executed in writing by the party entitled to the benefit of such term, covenant or condition. The waiver of any breach or default of any term, covenant or condition contained in this Agreement shall not be deemed to be a waiver of any preceding or subsequent breach or default of such term, covenant or condition or any other term, covenant or condition of this Agreement. Except as expressly provided in this Agreement, the rights and remedies under this Agreement are in addition to and not exclusive of any other rights, remedies, powers and privileges under this Agreement or available at law, in equity or otherwise. No failure to exercise or delay in exercising any right, remedy, power or privilege shall operate as a waiver thereof, and no single or partial exercise of any right, remedy, power or privilege shall preclude the exercise of any other right, remedy, power or privilege. Section 15.7 Counterparts. This Agreement may be executed in one or more counterparts, each of which, when taken together, shall constitute one and the same document. Section 15.8 Attorneys' Fees. Except as otherwise expressly set forth in this Agreement, each Party shall pay its own costs and expenses incurred in connection with this Agreement and such Party's performance under this Agreement, provided, that if either Party commences an action, proceeding, demand, claim, action, cause of action or suit against the other Party arising out of or in connection with this Agreement, then the substantially prevailing Party shall be reimbursed by the other Party for all reasonable costs and expenses, including reasonable attorneys' fees and expenses, incurred by the substantially prevailing Party in such action, proceeding, demand, claim, action, cause of action or suit, and in any appeal in connection therewith (regardless of whether the applicable action, proceeding, demand, claim, action, cause of action, suit or appeal is voluntarily withdrawn or dismissed). Section 15.9 Governing Law; Jurisdiction and Venue. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without regard to New York’s conflict of law principles. The proper venue for any claims, causes of action or other proceedings concerning this Agreement shall be in the state and federal courts located in the County of Fulton, State of New York. Section 15.10 Waiver of Jury Trial. To the extent permitted by applicable laws, the Parties waive trial by jury in any action, proceeding or counterclaim brought by the other Party hereto related to matters arising out of or in any way connected with this Agreement. Section 15.11 No Third Party Beneficiary. This Agreement is for the sole benefit of the Parties and their respective heirs, legatees, devisees, executors, administrators and permitted successors and assigns, and nothing in this Agreement shall give or be construed to give any other person or entity any legal or equitable rights. 24

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Section 15.12 Successors and Assigns. Each of the covenants, conditions and agreements contained in this Agreement shall inure to the benefit of and shall apply to and be binding upon the Parties hereto and their respective heirs, legatees, devisees, executors, administrators and permitted successors and assigns. Nothing in this Section 15.12 shall in any way alter the provisions of this Agreement restricting assignment. Section 15.13 Time of the Essence. Time is of the essence with respect to the performance of every provision in this Agreement. Section 15.14 Survivability. Except as otherwise provided in this Agreement to the contrary, the covenants and obligations of the Parties to this Agreement shall survive the Closing indefinitely. Section 15.15 Business Days. If the Closing Date or any other date described in this Agreement by which one Party hereto must give notice to the other Party hereto or perform or fulfill an obligation hereunder is a Calendar Day that is not a Business Day, then the Closing Date or such other date shall be automatically extended to the next succeeding Business Day. Section 15.16 Joint Liability. If more than one person or entity executes this Agreement as Seller, then (a) each of them is jointly and severally liable for the keeping, observing and performing of all of the terms, covenants, conditions, provisions and agreements of this Agreement to be kept, observed or performed by Seller, and such terms, covenants, conditions, provisions and agreements shall be binding with the same force and effect upon each and all of the persons executing this Agreement as Seller, and (b) the term "Seller" as used in this Agreement shall mean and include each of them, jointly and severally. Furthermore, all of the covenants, agreements, obligations, liabilities, indemnification undertakings, certifications, representations and warranties of Seller in this Agreement and in the Transaction Documents shall be deemed to be joint and several covenants, agreements, obligations, liabilities, indemnification undertakings, certifications, representations and warranties of Seller and Vireo Health, Inc., a Delaware corporation (the "Joiner"), and may be enforced against either of them, concurrently and successively, in such order as Buyer may determine. Section 15.17 Construction. Buyer and Seller have each participated in the drafting and negotiation of this Agreement, and the language in all parts of this Agreement shall be in all cases construed as a whole according to its fair meaning and not strictly for or against either Buyer or Seller. Section 15.18 Independent Obligations. Notwithstanding anything to the contrary contained in this Agreement, Seller's obligations under this Agreement are independent and shall not be conditioned upon performance by Buyer. Section 15.19 Facsimile and PDF Signatures. A facsimile or portable document format (PDF) signature on this Agreement shall be equivalent to, and have the same force and effect as, an original signature. Section 15.20 Covenant and Condition. Each provision of this Agreement performable by Seller shall be deemed both a covenant and a condition. Section 15.21 Reasonable Consent. Whenever consent or approval of either Party is required pursuant to this Agreement, that party shall not unreasonably withhold, condition or delay such consent or approval, except as may be expressly set forth to the contrary in this Agreement. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 25

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date set forth opposite each Party's name below. SELLER: VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company By: Name: Kyle Kingsley Title:CEO BUYER: IIP-NY 2 LLC, a Delaware limited liability company By: Name: Brian Wolfe Title: Vice President, General Counsel and Secretary 26

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IN WITNESS WHEREOf', the Parties have executed this Agreement as of the date set forth opposite each Party's name below. SELLER: VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company By: Name: Kyle Kingsley Title:CEO BUYER: IIP-NY 2 LLC, a Delaware limited liability company By: Name: Brian Wolfe Title: Vice President, General 26

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JOINERS' SEPARATE UNDERTAKING Pursuant to Section 15.16 of the foregoing Agreement, for value received, the undersigned, Vireo Health, Inc., a Delaware corporation, hereby acknowledges and agrees that the covenants, agreements, obligations, liabilities, indemnification undertakings, certifications, representations and warranties of Seller in the foregoing Agreement and in the Transaction Documents (as defined in the foregoing Agreement) shall be joint and several covenants, agreements, obligations, liabilities, indemnification undertakings, certifications, representations and warranties of Seller and of the undersigned, and may be enforced against Seller and/or the undersigned, concurrently or successively, in such order as Buyer may determine. The undersigned shall continue to be liable pursuant to this undertaking and the provisions hereof shall remain in full force and effect notwithstanding any modifications or amendment of the foregoing Agreement or the Transaction Documents or any other act, omission or conditions which might in any manner or to any extent vary the risk to the undersigned or might otherwise operate as a discharge or release of a guarantor or surety under any applicable law. The undersigned hereby fully and completely waives, releases and relinquishes (i) diligence and demand of payment, presentment, protest, dishonor and notice of dishonor; (ii) any and all other defenses and rights arising under applicable law, to the extent waivable; (iii) any and all benefits of any right of discharge under any and all statues or laws relating to a guarantor or surety, and (iv) any defense based upon the impairment, modification, change, release, discharge or limitation of the liability of Seller in bankruptcy, or resulting from or pursuant to, the application of the bankruptcy or insolvency laws of or any decision of any court of the United States or any state thereof. For the avoidance of doubt, the terms and conditions of this Joiner's Separate Undertaking shall survive the Closing. VIREO HEALTH, INC., a Delaware corporation By: Name: Title: 28

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CONSENT OF ESCROW AGENT The undersigned Escrow Agent hereby agrees to: (i) accept the foregoing Agreement; (ii) establish the Escrow and be Escrow Agent under said Agreement; (iii) to make all filings required under Section 6045 of the Internal Revenue Code of 1986, as amended; and (iv) be bound by said Agreement in the performance of its duties as Escrow Agent; provided, however, the undersigned shall have no obligations, liability or responsibility under (a) this Consent or otherwise, unless and until said Agreement, fully signed by the parties, has been delivered to the undersigned, or (b) any amendment to said Agreement unless and until the same is accepted by the undersigned in writing. Dated: , 2021 SETTLEMENT CORP By Name: Todd Deckelbaum Title: Vice President 27

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EXHIBIT A LEGAL DESCRIPTION OF LAND All of that tract or parcel of land situate in the Town of Perth, County of Fulton and State of New York being more particularly described as follows: Beginning at an iron rod set in the northwesterly line of County Road 117 at the northeast corner of the lands of Vireo Health of New York, LLC, running thence along the northerly line of the lands of Vireo Health of New York, LLC the following two courses: N70°18'12"W 824.41' to an iron rod set and S84°19'12"W 484.32' to an iron rod set in the line between the Town of Johnstown on the west and the Town of Perth on the east, thence running along the Town of Perth/Town of Johnstown line and through the lands of Fulton County Industrial Development Agency N05°55'15"W 2450.91' to the southeasterly line of the lands of Patricia Petrone, being 1.93' southerly of a town line monument, thence along the southeasterly line of the lands of Petrone as marked by a stone wall N51°12'20"E 176.01' to an iron pipe found, thence along the southwesterly line of the lands of George Wasyleniuk as marked by a stone wall S37°10'15"E 766.77' to an iron pipe found, thence along the southeasterly line of the lands of Wasyleniuk N51°53'55"E 593.56' to an iron pipe found, thence continuing along the southeasterly line of the lands of Wasyleniuk N50°59'51"E 428.34' to an iron rod set, thence along the southwesterly line of the lands of Wasyleniuk S36°53'41"E 891.71' to an iron pipe found, thence through the lands of Fulton County Industrial Development Agency the following five courses; S61°39'33"W 200.00' to an iron rod set, S28°20'27"E 180.00' to an iron rod set, S07°52'58"W 708.65' to an iron rod set, S47°21'19"E 275.12' to an iron rod set and S02°21'19"E 597.71' to an iron rod set in the northwesterly line of County Road 117, thence along the northwesterly line of County Road 117 the following two courses; S53°13'22"W 535.66' and thence on a curve to the left having a radius of 330.00' and a chord of S49°12'51"W 46.14' an arc length of 46.18' to the point of beginning. A-1

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EXHIBIT B SELLER'S DEED BARGAIN AND SALE DEED WITH COVENANT AGAINST GRANTOR’S ACTS THIS INDENTURE, dated , 2021, between [ ], having an address at ("Grantor"), and , having an address at ("Grantee"), WITNESSETH, that Grantor in consideration of the sum of Ten Dollars ($10.00), and other good and valuable consideration paid by the Grantee, the receipt and sufficiency of which are hereby acknowledged by Grantor, does hereby grant and release and assign forever unto Grantee, and the heirs, successors and assigns of Grantee: All that certain plot, piece or parcel of land situate in the Town of Perth, Fulton County, State of New York, with buildings and improvements thereon erected, situate, lying and being, as more particularly bounded and described on Exhibit “A” attached hereto and made a part hereof (the "Premises"); Being and intended to be the same premises conveyed to Grantor from [ _], by deed dated [ ], and recorded [_ ], in the Fulton County Clerk’s Office, State of New York. TOGETHER with all right, title and interest, if any, of Grantor in and to any streets and roads abutting therewith and all right, title and interest, if any, of Grantor in and to any easements, rights of way, privileges, benefits, appurtenances, hereditaments, strips, gaps and gores, and any and all other rights, if any, thereon or in any way pertaining thereto, including, without limitation, any land lying in the bed of any streets and roads abutting the Premises the center lines thereof; TOGETHER with the appurtenances and all the estate and rights of Grantor in and to said Premises; TO HAVE AND TO HOLD the Premises herein granted, or mentioned and intended so to be, unto Grantee, and the heirs, successors and assigns of Grantee, forever; AND Grantor covenants that Grantor has not done or suffered anything whereby the Premises have been encumbered in any way whatever. AND Grantor covenants as follows: that Grantor is seized of the Premises herein granted in fee simple, and has good right to convey the same; that Grantee shall quietly enjoy the said Premises; that the said Premises are free from encumbrances; that Grantor will execute or procure any further necessary assurance of the title to said Premises; and Grantor will forever warrant the title to the Premises granted herein. AND Grantor, in compliance with Section 13 of the Lien Law, covenants that Grantor will receive the consideration for this conveyance and will hold the right to receive such consideration as a trust fund to be applied first for the purpose of paying the cost of improvements and will apply the same first to the payment of the cost of improvements before using any part of the total of the same or any other purpose. [Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, Grantor has duly executed this deed the day and year first above written. GRANTOR: [ _] By: Name: Title: Signature Page to Bargain and Sale Deed with Covenant Against Grantor’s Acts

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State of ) County of _) On before me, _, (insert name and title of the officer) personally appeared _, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature (Seal) D-1 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

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EXHIBIT A TO SELLER’S DEED Legal Description D-2

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BARGAIN AND SALE DEED WITH COVENANT AGAINST GRANTOR’S ACTS [ ] TO [ ] Block: Lot: County: Address: RECORD AND RETURN TO: IIP-NY 2 LLC 11440 West Bernardo Court, Suite 100 San Diego, California 92127 Attn: General Counsel D-3

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EXHIBIT C INTENTIONALLY OMITTED D-4

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EXHIBIT D CERTIFICATE OF NON-FOREIGN STATUS The undersigned, being duly sworn, hereby deposes, certifies and states on oath as follows: 1. That the undersigned, ("Transferor"), is duly authorized to execute this Certificate and Affidavit; 2. That Transferor's principal place of business is ; 3. That Transferor is not a "foreign corporation," "foreign partnership," "foreign trust," or "foreign estate," as such terms are defined in the United States Internal Revenue Code of 1986, as amended (the "Code"), and Regulations promulgated thereunder, and is not otherwise a "foreign person," as defined in Section 1445 of the Code; 4. Regulations; That Transferor is not a disregarded entity as defined in Section 1.1445-2(b)(2)(iii) of the Treasury 5. That Transferor's United States taxpayer identification number is: ; 6. That the undersigned is making this Certificate and Affidavit pursuant to the provisions of Section 1445 of the Code in connection with the sale of the real property described on Exhibit 1 attached hereto and incorporated herein by reference, by Transferor to ("Transferee"), which sale constitutes the disposition by Transferor of a United States real property interest, for the purposes of establishing that Transferee is not required to withhold tax pursuant to Section 1445 of the Code in connection with such disposition; and 7. That the undersigned acknowledges that this Certificate and Affidavit may be disclosed to the Internal Revenue Service and other applicable governmental agencies by Transferee, that this Certificate and Affidavit is made under penalty of perjury, and that any false statement made herein could be punished by fine, imprisonment, or both. Under penalty of perjury, I declare that I have examined the foregoing Certificate and Affidavit and I hereby certify that it is true, correct and complete. TRANSFEROR: By EXHIBIT – DO NOT SIGN Title [INSERT NOTARY] D-5

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Exhibit 1 To Certificate of Non-Foreign Status Legal Description of Real Property [INSERT] D-6

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EXHIBIT E INTENTIONALLY OMITTED E-1

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EXHIBIT F ASSIGNMENT OF PERMITS, ENTITLEMENTS AND INTANGIBLE PROPERTY THIS ASSIGNMENT OF PERMITS, ENTITLEMENTS AND INTANGIBLE PROPERTY (the "Assignment") is made and dated for reference purposes as of , 20 and is entered into by ("Assignor") in favor of ("Assignee"). RECITALS A. Assignor and Assignee are parties to that certain Purchase and Sale Agreement and Joint Escrow Instructions, dated [ ], 2021, as amended and assigned ("Purchase Agreement"). Unless otherwise expressly defined herein, capitalized terms used herein without definition shall have the same meaning given to such terms in the Purchase Agreement. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows: 1. Assignment by Assignor. Effective as of the Closing, Assignor hereby transfers and assigns to Assignee the Intangible Property and the Permits and Entitlements. 2. Successors and Assigns. This Assignment shall be binding upon and inure to the benefit of the successors, assigns, personal representatives, heirs and legatees of the respective Parties hereto. 3. Attorneys' Fees. In the event of any legal action between Assignor and Assignee arising out of or in connection with this Assignment, the prevailing party shall be entitled to recover from the other party reasonable attorneys' fees and costs incurred in such action and any appeal therefrom. 4. Governing Law; Jurisdiction and Venue. This Assignment shall be governed by, interpreted under, and construed and enforceable with, the laws of the State of New York. The proper venue for any claims, causes of action or other proceedings concerning this Assignment shall be in the state and federal courts located in the County of Fulton, State of New York. 5. Counterparts. This Assignment may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together constitute one and the same instrument. 6. Cooperation. Assignor hereby agrees to and shall execute and deliver to Assignee any and all documents, agreements and instruments necessary to consummate the transactions contemplated by this Assignment. F-1

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IN WITNESS WHEREOF, Assignor and Assignee have caused this Assignment to be executed as of the day and year first above written. ASSIGNOR: By EXHIBIT - DO NOT SIGN Title ASSIGNEE: By EXHIBIT - DO NOT SIGN Title F-2

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EXHIBIT G GENERAL PROVISIONS OF ESCROW THESE GENERAL PROVISIONS OF ESCROW ("General Provisions"), are deemed entered into pursuant to that certain Purchase and Sale Agreement and Joint Escrow Instructions, dated September 1st, 2021, by and between Vireo Health of New York, LLC, as the "Seller,", and IIP-NY 2 LLC, as the "Buyer," as the same may be amended from time to time ("Purchase Agreement"). Capitalized terms used herein without definition shall have the meanings given to such terms in the Purchase Agreement. THE PARTIES UNDERSTAND AND ACKNOWLEDGE: 1. Deposit of Funds and Disbursements. Unless directed in writing by Seller or Buyer, as applicable, to establish a separate, interest-bearing account together with all necessary taxpayer reporting information, all funds received by Escrow Agent shall be deposited in general escrow accounts in a federally insured financial institution ("Depositories"). All disbursements shall be made by Escrow Agent's check or by wire transfer unless otherwise instructed in writing by the party to receive such disbursement. The Good Funds Law requires that Escrow Agent have confirmation of receipt of funds prior to disbursement. 2. Disclosure of Possible Benefits to Escrow Agent. As a result of Escrow Agent maintaining its general escrow accounts with the Depositories, Escrow Agent may receive certain financial benefits such as an array of bank services, accommodations, loans or other business transactions from the Depositories ("Collateral Benefits"). Notwithstanding the foregoing, the term Collateral Benefits shall not include any interest that accrues or is earned on the Initial Deposit and in no event and under no circumstance shall Escrow Agent be entitled to receive and retain any interest that accrues or is earned on the Initial Deposit. All Collateral Benefits shall accrue to the sole benefit of Escrow Agent and Escrow Agent shall have no obligation to account to the parties to this Escrow for the value of any such Collateral Benefits. 3. Miscellaneous Fees. Escrow Agent may incur certain additional costs on behalf of the parties for services performed by third party providers. The fees charged by Escrow Agent for such services shall not include a markup or premium over the direct cost of such services. 4. Prorations and Adjustments. All prorations and/or adjustments shall be made in accordance with the Purchase Agreement. 5. Contingency Periods. Escrow Agent shall not be responsible for monitoring contingency time periods between the Parties. 6. Reports. As an accommodation, Escrow Agent may agree to transmit orders for inspection, termite, disclosure and other reports if requested, in writing or orally, by the parties or their agents. Escrow Agent shall deliver copies of any such reports as directed. Escrow Agent is not responsible for reviewing such reports or advising the parties of the content of the same. 7. Recordation of Documents. Escrow Agent is authorized to prepare, obtain, record and deliver the necessary instruments to carry out the terms and conditions of this Escrow and, to the extent that Escrow Agent is also the Title Company, to issue the ALTA Extended Coverage Policy at Closing, subject to and in accordance with the Purchase Agreement or pursuant to separate written instructions to Escrow Agent executed by Seller. 8. Conflicting Instructions and Disputes. No notice, demand or change of instructions shall be of any effect in this Escrow unless given in writing by Seller and Buyer. In the event a demand for the Initial Deposit and/or any other amounts in this Escrow is made which is not concurred with by Seller and Buyer (regardless of who made demand therefor), Escrow Agent may elect to file a suit in interpleader and obtain an order from the court allowing Escrow Agent to deposit all funds and documents in court and have no further liability with respect thereto. If an action is brought involving this Escrow and/or Escrow Agent, Seller and Buyer agree to indemnify and hold Escrow Agent harmless against liabilities, damages and costs incurred by Escrow Agent (including reasonable attorney's fees G-1

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and costs) except to the extent that such liabilities, damages and costs were caused by the negligence, gross negligence or willful misconduct of Escrow Agent. 9. Amendments to General Provisions. Any amendment to these General Provisions must be mutually agreed to by Seller and Buyer and accepted by Escrow Agent. The Purchase Agreement and these General Provisions shall constitute the entire escrow agreement between the Escrow Agent and the parties hereto with respect to the subject matter of the Escrow. 10. Copies of Documents; Authorization to Release. Escrow Agent is authorized to rely upon copies of documents, which include facsimile, electronic, NCR, or photocopies as if they were an originally executed document. If requested by Escrow Agent, the originals of such documents shall be delivered to Escrow Agent. Documents to be recorded MUST contain original signatures. Escrow Agent may furnish copies of any and all documents to the lender(s), real estate broker(s), attorney(s) and/or accountant(s) involved in this transaction upon their request. 11. Execution in Counterpart. These General Provisions and any amendments may be executed in one or more counterparts, each of which shall be deemed an original, and all of which taken together shall constitute the same instruction. 12. Tax Reporting, Withholding and Disclosure. The Parties are advised to seek independent advice concerning the tax consequences of this transaction, including but not limited to, their withholding, reporting and disclosure obligations. Escrow Agent does not provide tax or legal advice and the parties agree to hold Escrow Agent harmless from any loss or damage that the parties may incur as a result of their failure to comply with federal and/or state tax laws. EXCEPT AS OTHERWISE REQUIRED UNDER APPLICABLE LAW, WITHHOLDING OBLIGATIONS ARE THE EXCLUSIVE OBLIGATIONS OF THE PARTIES AND ESCROW AGENT IS NOT RESPONSIBLE TO PERFORM THESE OBLIGATIONS UNLESS ESCROW AGENT AGREES IN WRITING. 13. Taxpayer Identification Number Reporting. Federal law requires Escrow Agent to report Seller's social security number and/or tax identification number, forwarding address, and the gross sales price to the Internal Revenue Service. Escrow cannot be closed nor any documents recorded until the information is provided and Seller certifies the accuracy of such information to Escrow Agent. 14. Purchase Agreement. In the event of any conflict between the terms and conditions of the Purchase Agreement and the terms and conditions of these General Provisions, the terms and conditions of the Purchase Agreement shall govern. 15. Notices. All notices relating to these General Provisions shall be given in compliance with the Notice provisions set forth in the Purchase Agreement. G-2

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EXHIBIT H FORM OF LEASE AMENDMENT [TO BE ATTACHED] H-1

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THIRD AMENDMENT TO LEASE AGREEMENT THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of this day of _, 2021 (the “Amendment Effective Date”), by and between IIP-NY 2 LLC, a Delaware limited liability company (“Landlord”), and Vireo Health of New York, LLC, a New York limited liability company (“Tenant”). RECITALS A. WHEREAS, Landlord and Tenant are parties to that certain Lease Agreement dated as of October 23, 2017, as amended by that certain First Amendment to Lease Agreement dated as of December 7, 2018, and as further amended by that certain Second Amendment to Lease Agreement dated as of April 10, 2020 (collectively, the “Existing Lease”), whereby Tenant leases the premises from Landlord located at 256 County Route 117 in Perth, New York; and B. WHEREAS, Landlord and Tenant desire to modify and amend the Existing Lease only in the respects and on the conditions hereinafter stated. AGREEMENT NOW, THEREFORE, Landlord and Tenant, in consideration of the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, agree as follows: 1. Definitions. For purposes of this Amendment, capitalized terms shall have the meanings ascribed to them in the Existing Lease unless otherwise defined herein. The Existing Lease, as amended by this Amendment, is referred to collectively herein as the “Lease.” From and after the date hereof, the term “Lease,” as used in the Existing Lease, shall mean the Existing Lease, as amended by this Amendment. 2. Expansion of Premises. Concurrent with the execution of this Amendment, Landlord closed on the purchase of certain real property located in Perth, New York (collectively, the “Additional Parcel”), as more particularly described in that certain Purchase and Sale Agreement and Joint Escrow Instructions dated August 31, 2021, by and between Landlord and Tenant (the “Additional Parcel Purchase Agreement”). Landlord desires to lease to Tenant, and Tenant desires to lease from Landlord, the Additional Parcel pursuant to the terms and conditions of the Lease. Accordingly, effective as of the Amendment Effective Date, Exhibit A to the Existing Lease is hereby deleted in its entirety and replaced with Exhibit A to this Amendment, and all references in the Lease to the “Premises” shall mean and refer to the real property described on Exhibit A attached to this Amendment, including the Buildings, shafts, cable runs, mechanical spaces, rooftop areas, landscaping, parking facilities, private drives and other improvements now or hereafter located thereon and appurtenances related thereto for use by Tenant in accordance with the Permitted Use. 3. Term. Section 3.1 of the Existing Lease is hereby amended and restated in its entirety as follows: "3.1. Term. The actual term of this Lease (as the same may be extended or earlier terminated in accordance with this Lease, the "Term") commenced on October 23, 2017 _], 20411, subject to extension or (the "Commencement Date") and shall end on [_ earlier termination of this Lease as provided herein." 1 Insert date that is 240 months from the Amendment Effective Date.

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4. additional [ TI Allowance. Tenant has requested, and Landlord has agreed, to increase the TI Allowance by an ) (the “Additional TI Allowance”)2. Accordingly, the first ] Dollars ($ sentence of Section 5.1 of the Existing Lease is hereby amended and restated in its entirety as follows: "Tenant shall cause appropriate improvements consistent with the Permitted Use (the "Tenant Improvements") to be constructed in the Premises pursuant to the Work Letter attached hereto as Exhibit E (the "Work Letter") at a cost to Landlord not to exceed [ ] Dollars ($ )3 (the "TI Allowance")." In addition, the second sentence of Section 5.1 of the Existing Lease is hereby amended and restated in its entirety as follow: "The TI Allowance may be applied to the costs of (a) construction, (b) project review by Landlord (which fee shall not exceed Twenty Thousand Dollars ($20,000.00) plus any reasonable actual out-of-pocket third-party expenses incurred by Landlord), (c) commissioning of mechanical, electrical and plumbing systems by a licensed, qualified commissioning agent hired by Tenant, and review of such party’s commissioning report licensed, qualified commissioning agent hired by Landlord, (d) space planning, architect, engineering and other related services performed by third parties unaffiliated with Tenant, (e) building permits and other taxes, fees, charges and levies by governmental authorities for permits or for inspections of the Tenant Improvements, and (f) costs and expenses for labor, material, equipment and fixtures." In addition, the final sentence of Section 5.2 of the Existing Lease is hereby deleted in its entirety and replaced with the following: "In addition, Landlord’s obligation to disburse any of the TI Allowance in excess of ) 4 shall be conditional upon the satisfaction [ _] Dollars ($ of the following: (a) Tenant's delivery to Landlord of a certificate of occupancy for the Premises suitable for the Permitted Use, as applicable; (b) Tenant's delivery to Landlord of a Certificate of Substantial Completion in the form of the American Institute of Architects document G704, executed by the project architect and the general contractor or such other form or certification as may be reasonably acceptable to Landlord; (c) Tenant's satisfaction of the conditions precedent to funding of the TI Allowance set forth in Section 6.3 of the Work Letter; and (d) there shall be no uncured event of default by Tenant under this Lease. Following the completion of the Tenant Improvements, Landlord may order, at Tenant’s expense, a current title report or lien search for the Premises to confirm that the Premises remains free and clear of all liens relating to the completion of the Tenant Improvements. Tenant agrees to promptly pay or reimburse Landlord for the costs relating to such title report or lien search upon receipt of an invoice from Landlord." 5. Section 18.2.6: Tenant Insurance. Section 18.2 of the Existing Lease is hereby amended to add the following new "At all times during construction Tenant shall maintain (or cause to be maintained, as applicable) in full force and effect an “all risk” builder’s risk completed value form, which form shall: (a) be on a non-reporting basis, (b) insure against all risks insured including, without limitation, fire and other perils normally included, including at Landlord’s option, terrorism, windstorm, earthquake and flood coverage, (c) for structural or non-structural 2 An amount equal to $56,300,000 less the Purchase Price paid for the Additional Parcel. 3 An amount equal to $3,360,000 (the existing TI Allowance) plus the Additional TI Allowance. 4. An amount equal to the new TI Allowance less $500,000. 2

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renovation, cover 100% of any existing Building, (d) include permission to occupy the Premises, without restrictions, as appropriate, (d) have an agreed amount endorsement waiving co-insurance provisions, (e) include coverage for 100% of the reoccurring hard costs and soft costs, (f) cover losses suffered with respect to Tenant’s materials, equipment, machinery and/or supplies (whether on-site, in transit, or stored off-site) with a limit of no less than 100% of the replacement cost, (g) provide for no deductible in excess of $250,000, except with respect to earthquake, windstorm/named storm, and flood; and (h) otherwise be in form and substance reasonably acceptable to Landlord. Notwithstanding the foregoing, Landlord may elect to procure and maintain the coverage required pursuant to this Section 18.2.6 by providing notice to Tenant of such election." [Furthermore, Landlord and Tenant acknowledge and agree that Landlord has elected to procure and maintain the insurance required hereunder with respect to the Tenant Improvements contemplated to be constructed with the Additional TI Allowance.] [To be confirmed based upon Closing Date] 6. Tenant Work Insurance Schedule. Exhibit E-1 of the Existing Lease is hereby deleted in its entirety and replaced with Exhibit E-1 attached to this Amendment. 7. Monthly Base Rent. Notwithstanding anything in the Existing Lease to the contrary, in consideration of the Additional TI Allowance, commencing on the Amendment Effective Date: (a) the monthly Base Rent shall increase by Four Hundred Ninety-Two Thousand Six Hundred Twenty-Five Dollars ($492,625.00) (the “Additional Base Rent”), provided that the Additional Base Rent shall be phased in during the sixteen (16) month period following the Amendment Effective Date as set forth below (such sixteen month period, the “Additional Base Rent Adjustment Period”); (b) in lieu of the Base Rent adjustments set forth in Section 6.5 of the Existing Lease, the Additional Base Rent shall be subject to an annual upward adjustment of two and three-quarters percent (2.75%) of the then-current Additional Base Rent, with the first such adjustment to become effective commencing on the first anniversary of the Amendment Effective Date, and subsequent adjustments to become effective on every successive annual anniversary of the Amendment Effective Date for so long as the Lease continues in effect; and (c) the Base Rent under the Existing Lease shall be adjusted for the last five (5) years of the Term in accordance with this Amendment, subject to the adjustments set forth in the Lease, including the Base Rent adjustments set forth in Section 6.5 of the Existing Lease on each anniversary of the Commencement Date. For illustrative purposes, the chart below sets forth the incremental increases to Base Rent to account for the Additional Base Rent, subject to adjustment pursuant to this Section 7, to be phased in during the Additional Base Rent Adjustment Period, and the rent chart attached as Exhibit F to this Amendment sets forth the monthly aggregate Base Rent and Property Management Fee for the Term of the Lease, including the adjustments to Base Rent as set forth in the Lease. Amount of Additional Base Rent: 5 Additional Base Rent Adjustment Period: Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 $30,789.06 $61,578.13 $92,367.19 $123,156.25 $153,945.31 $184,734.38 $215,523.44 $246,312.50 $277,101.56 $307,890.63 $338,679.69 5 The Additional Base Rent to be phased in ratably over the Additional Base Rent Adjustment Period. The chart includes the 2.75% annual upward adjustment to the Additional Base Rent on the anniversary of the Amendment Effective Date. 3

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Month 12 Month 13 Month 14 Month 15 Month 16 $369,468.75 $411,264.90 $442,900.66 $474,536.43 $506,172.19 8. Securitv Deposit. In further consideration for the Additional TI Allowance, the Security Deposit is hereby increased by One Million Three Htmdred Ninety Thousand Dollars ($1,390,000.00) (the "Additional Security Deposit") to One Million Seven Hundred Fifty Thousand Dollars ($1,750,000.00), provided that the Additional Security Deposit shall be paid in installments in accordance with this Section 8. In connection with any funding of the TI Allowance, Landlord shall deduct from the amount of the TI Allowance requested by Tenant and approved by Landlord in connection with a Ftmd Request pursuant to Section6.3 of the Work Letter (the "TI Allowance Payment"), a proportionate amount of the TI Allowance Payment to be retained by Landlord as patt of the Additional Secm·ity Deposit (the "Additional Secm'itv Deposit Installment"), which propmtionate amotmt shall be determined based upon the percentage derived from dividing the amount of the TI Allowance Payment by Fifty-Six Million Three Htmdred Thousand Dollars ($56,300,000.00) until such time as the Additional Security Deposit has been fully ftmded. As an example, if the amount of the TI Allowance Payment is equal to $5,630,000 (i.e. 10% of$56,300,000), then Landlord shall retain an amom1t equal to $139,000 as pa.tt of the Security Deposit (i.e. 10% of $1,390,000.00). h1addition, the penultimate sentence in Section 6.4 of the Existing Lease is hereby deleted in its entirety. 9. Petmitted Transfer. The first sentence of Section 16.8 of the Existing Lease is hereby amended and restated in its entirety as follows: "Tenant may assign its entire interest under tllis Lease or sublease ail or a pmtion of the Premises without the consent of Landlord to: (i) an affiliate, subsidiary or parent of Tenant; (ii) any entity into wllich that Tenru1t or an affiliated party may merge or consolidate; (iii) any entity that acquires all or substantially all of the assets of Tenant; each a "Permitted Transfer" and such tra.tlSferee a "Permitted Transferee", provided that (a) Tenant notifies Landlord at least twenty (20) days prior to the effective date of any such Permitted Transfer, (b) Tenant is not in default and such assignment or sublease is not a subterfuge by Tenant to avoid its obligations under this Lease, (c) such Petmitted Transferee shall have a tru1gible net worth (not including goodwill as an asset) computed in accordance with generally accepted accounting principles ("Net Worth") at least equal to the Net Wmth of the original Tenant on the day immediately preceding the effective date of such assiglllllent or sublease and reasonably sufficient to comply with the obligations under this Lease, (d) no assiglllllent or sublease relating to this Lease, whether with or without Landlord's consent, shaH relieve Tenant from any liability under this Lease, (e) the liability of such Petmitted Tra.IlSferee tulder either an assigmnent or sublease shall be joint and several with Tenant and each Guarantor; and (f) the ultimate pru·ent company of any Pennitted Transferee executes a GUa.I·anty in favor of Landlord substantially in the fonn attached hereto as Exhibit D." 4

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to Five Hundred Seventy-Eight Thousand Four Hundred Eighty-Two and 50/100 Dollars ($578,482.50), subject to further adjustment as set forth in Section 7 of this Amendment. Within ten (10) days of receipt of an amendment to the Lease memorializing the adjustment of the Additional Base Rent pursuant to this Section 10 (the “Lease Amendment”), Tenant agrees to execute and deliver such Lease Amendment to Landlord, provided Tenant’s failure to timely deliver the Lease Amendment shall not delay or preclude the adjustments to the Additional Base Rent as set forth herein nor shall such failure negate Tenant’s liability therefor. 11. Broker. Tenant represents and warrants that it has not dealt with any broker or agent in the negotiation for or the obtaining of this Amendment and agrees to reimburse, indemnify, save, defend (at Landlord’s option and with counsel reasonably acceptable to Landlord, at Tenant’s sole cost and expense) and hold harmless the Landlord Indemnitees for, from and against any and all cost or liability for compensation claimed by any such broker or agent employed or engaged by it or claiming to have been employed or engaged by it. 12. No Default. Tenant represents, warrants and covenants that, to the best of Tenant’s knowledge, Landlord and Tenant are not in default of any of their respective obligations under the Existing Lease and no event has occurred that, with the passage of time or the giving of notice (or both) would constitute a default by either Landlord or Tenant thereunder. 13. Effect of Amendment. Except as modified by this Amendment, the Existing Lease and all the covenants, agreements, terms, provisions and conditions thereof shall remain in full force and effect and are hereby ratified and affirmed. In the event of any conflict between the terms contained in this Amendment and the Existing Lease, the terms herein contained shall supersede and control the obligations and liabilities of the parties. 14. Successors and Assigns. Each of the covenants, conditions and agreements contained in this Amendment shall inure to the benefit of and shall apply to and be binding upon the parties hereto and their respective heirs, legatees, devisees, executors, administrators and permitted successors and assigns and sublessees. Nothing in this section shall in any way alter the provisions of the Lease restricting assignment or subletting. 15. Miscellaneous. This Amendment becomes effective only upon execution and delivery hereof by Landlord and Tenant. The captions of the paragraphs and subparagraphs in this Amendment are inserted and included solely for convenience and shall not be considered or given any effect in construing the provisions hereof. All exhibits hereto are incorporated herein by reference. Submission of this instrument for examination or signature by Tenant does not constitute a reservation of or option for a lease, and shall not be effective as a lease, lease amendment or otherwise until execution by and delivery to both Landlord and Tenant. 16. Authority. Tenant guarantees, warrants and represents that the individual or individuals signing this Amendment have the power, authority and legal capacity to sign this Amendment on behalf of and to bind all entities, corporations, partnerships, limited liability companies, joint venturers or other organizations and entities on whose behalf such individual or individuals have signed. 17. Counterparts; Facsimile and PDF Signatures. This Amendment may be executed in one or more counterparts, each of which, when taken together, shall constitute one and the same document. A facsimile or portable document format (PDF) signature on this Amendment shall be equivalent to, and have the same force and effect as, an original signature. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 5

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date and year first above written. LANDLORD: IIP-NY 2 LLC, a Delaware limited liability company By: Name: Title: Brian Wolfe Vice President, General Counsel and Secretary TENANT: VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company By: Name: Title:

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EXHIBIT A PREMISES Original Premises: ALL OF THAT TRACT OR PARCEL OF LAND situate in the Town of Perth, County of Fulton and State of New York, being more particularly described as follows: BEGINNING at an iron rod set in the westerly line of County Road 117, running thence through the lands of Fulton County Industrial Development Agency the following six courses: S 65° 22’ 52” W 144.87’ to an iron rod set, S 02° 46’ 29” E 45.53’ to an iron rod set, S 31°23’32” W 209.35’ to an iron rod set, S 15°59’04” W 50.00’ to an iron rod set, N 80°02’57” W 93.32’ to an iron rod set and S 74°41’28” W 498.22’ to an iron rod set at the southeast corner of the lands of Don Brown Bus Sales, thence along the northeasterly line of Don Brown Bus Sales N 37°03’34” W 466.75’ to an iron rod set, thence along the line between the Town of Perth on the east and the Town of Johnstown on the west N 05°55’15’ W 619.76’ to an iron rod set, thence through the lands of Fulton County Industrial Development Agency the following two courses: N 84°19’12” E 484.32’ to an iron rod set and S 70°18’12” E 824.41’ to the northwesterly line of County Road 117, thence along the line of County Road 117 on a non-tangent curve to the left having a radius of 330.00’ and a chord of S 15°52’43” W 323.26’ an arc length of 337.82’ to the point of beginning, containing 20.598 acres. Also being the same premises shown on a Map entitled “Survey of a Portion of Lands of Fulton County Industrial Development Agency”, made by Ferguson & Foss Professional Land Surveyors, PC, dated May 6, 2015 and revised September 22, 2015 and recorded in the Fulton County Clerk’s Office on April 13, 2016 as Instrument No. 2016-73. Additional Premises: All of that tract or parcel of land situate in the Town of Perth, County of Fulton and State of New York being more particularly described as follows: Beginning at an iron rod set in the northwesterly line of County Road 117 at the northeast corner of the lands of Vireo Health of New York, LLC, running thence along the northerly line of the lands of Vireo Health of New York, LLC the following two courses: N70°18'12"W 824.41' to an iron rod set and S84°19'12"W 484.32' to an iron rod set in the line between the Town of Johnstown on the west and the Town of Perth on the east, thence running along the Town of Perth/Town of Johnstown line and through the lands of Fulton County Industrial Development Agency N05°55'15"W 2450.91' to the southeasterly line of the lands of Patricia Petrone, being 1.93' southerly of a town line monument, thence along the southeasterly line of the lands of Petrone as marked by a stone wall N51°12'20"E 176.01' to an iron pipe found, thence along the southwesterly line of the lands of George Wasyleniuk as marked by a stone wall S37°10'15"E 766.77' to an iron pipe found, thence along the southeasterly line of the lands of Wasyleniuk N51°53'55"E 593.56' to an iron pipe found, thence continuing along the southeasterly line of the lands of Wasyleniuk N50°59'51"E 428.34' to an iron rod set, thence along the southwesterly line of the lands of Wasyleniuk S36°53'41"E 891.71' to an iron pipe found, thence through the lands of Fulton County Industrial Development Agency the following five courses; S61°39'33"W 200.00' to an iron rod set, S28°20'27"E 180.00' to an iron rod set, S07°52'58"W 708.65' to an iron rod set, S47°21'19"E 275.12' to an iron rod set and S02°21'19"E 597.71' to an iron rod set in the northwesterly line of County Road 117, thence along the northwesterly line of County Road 117 the following two courses; S53°13'22"W 535.66' and thence on a curve to the left having a radius of 330.00' and a chord of S49°12'51"W 46.14' an arc length of 46.18' to the point of beginning.

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EXHIBIT E-1 TENANT WORK INSURANCE SCHEDULE Tenant shall be responsible for requiring all of Tenant contractors doing construction or renovation work to purchase and maintain such insurance as shall protect it from the claims set forth below which may arise out of or result from any Tenant Work whether such Tenant Work is completed by Tenant or by any Tenant contractors or by any person directly or indirectly employed by Tenant or any Tenant contractors, or by any person for whose acts Tenant or any Tenant contractors may be liable: 1. Claims under workers' compensation, disability benefit and other similar employee benefit acts which are applicable to the Tenant Work to be performed. Claims for damages because of bodily injury, occupational sickness or disease, or death of employees under any applicable employer's liability law. Claims for damages because of bodily injury, or death of any person other than Tenant's or any Tenant contractors' employees. Claims for damages insured by usual personal injury liability coverage which are sustained (a) by any person as a result of an offense directly or indirectly related to the employment of such person by Tenant or any Tenant contractors or (b) by any other person. Claims for damages, other than to the Tenant Work itself, because of injury to or destruction of tangible property, including loss of use therefrom. Claims for damages because of bodily injury or death of any person or property damage arising out of the ownership, maintenance or use of any motor vehicle. 2. 3. 4. 5. 6. Tenant contractors' Commercial General Liability Insurance shall include premises/operations (including explosion, collapse and underground coverage if such Tenant Work involves any underground work), elevators, independent contractors, products and completed operations, and blanket contractual liability on all written contracts, all including broad form property damage coverage. The policy form shall be the most current ISO form CG001, or its equivalent. Tenant contractors' Commercial General, Automobile, Employers and Umbrella Liability Insurance shall be written for not less than limits of liability as follows: a. Commercial General Liability: Bodily Injury and Property Damage Commercially reasonable amounts, but in any event no less than $1,000,000 per occurrence and $2,000,000 general aggregate, with $2,000,000 products and completed operations aggregate. b. Commercial Automobile Liability: Bodily Injury and Property Damage Employer's Liability: Each Accident Disease – Policy Limit Disease – Each Employee Excess/Umbrella Liability: Bodily Injury and Property Damage $1,000,000 per accident c. $1,000,000 $1,000,000 $1,000,000 Commercially reasonable amounts (excess of coverages a, b and c above), but in any event no less than $10,000,000 per occurrence / aggregate. d. e. Professional Liability $1,000,000 per claim $1,000,000 aggregate Statutory Limits f. Workers Compensation Except for the professional liability coverage and any different limits that are reasonably approved by Landlord, all subcontractors for Tenant contractors shall carry the same coverages and limits as specified above, provided the

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coverage for Umbrella Liability shall be no less than $3,000,000 per occurrence / aggregate. The foregoing policies shall contain a provision that coverages afforded under the policies shall not be canceled or not renewed until at least thirty (30) days' prior written notice has been given to the Landlord. Certificates of insurance including required endorsements showing such coverages to be in force shall be filed with Landlord prior to the commencement of any Tenant Work and prior to each renewal. Coverage for completed operations must be maintained for the lesser of ten (10) years and the applicable statue of repose following completion of the Tenant Work, and certificates evidencing this coverage must be provided to Landlord. The minimum A.M. Best's rating of each insurer shall be A-VII. Landlord and its mortgagees shall be named as an additional insureds under Tenant contractors' Commercial General Liability, Commercial Automobile Liability and Umbrella Liability Insurance policies on a primary and non-contributory basis as respects liability arising from work or operations performed, or ownership, maintenance or use of autos, by or on behalf of such contractors. Each contractor and its insurers shall provide waivers of subrogation in favor of all Additional Insureds with respect to any claims covered or that should have been covered by valid and collectible insurance, including any deductibles or self-insurance maintained thereunder. If any contractor's work involves the handling or removal of asbestos (as determined by Landlord in its sole and absolute discretion), such contractor shall also carry Contractors’ Pollution Liability insurance. Such coverage shall include bodily injury, sickness, disease, death or mental anguish or shock sustained by any person; property damage, including physical injury to or destruction of tangible property (including the resulting loss of use thereof), clean-up costs and the loss of use of tangible property that has not been physically injured or destroyed; and defense costs, charges and expenses incurred in the investigation, adjustment or defense of claims for such damages. Coverage shall apply to both sudden and non-sudden pollution conditions including the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, the atmosphere or any watercourse or body of water. Claims-made coverage is permitted, provided the policy retroactive date is continuously maintained prior to the Commencement Date, and coverage is continuously maintained during all periods in which Tenant occupies the Premises. Coverage shall be maintained with limits of not less than $1,000,000 per incident with a $2,000,000 policy aggregate.

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EXHIBIT F MONTHLY BASE RENT AND PROPERTY MANAGEMENT FEE SCHEDULE [See Attached]

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SCHEDULE 1.0 LIST OF SELLER'S DELIVERIES PROPERTY DILIGENCE 1) Property Acquisition: Purchase and Sale Agreement and ancillary documents regarding purchase of Property (including purchase option agreement) FF&E: Detailed breakdown of FF&E now owned or expected to be acquired to support operations, including costs Approvals: Evidence of approvals, zoning and permitting for the Property, including evidence of support from the local jurisdiction as necessary Build-out Plans: Drawings, approvals, permitting, budgets, GC contract / bids for TI work to be done at the Property Title Policy / Survey: Most recent issued policy of title insurance, together with copies of all listed exceptions, and current draft policy of title insurance as well as most recent survey Environmental: Environmental reports, including those generated by third parties Physical: Soils or Geological report, if available Taxes: Current Property tax bills and assessor’s statements of current assessed value 2) 3) 4) 5) 6) 7) 8) COMPANY DILIGENCE (to the extent not publicly available) 1) General Company Information a. Most recent entity structure chart, including all subs, affiliates, parent companies and ultimate beneficial owners Any new organizational documents for Tenant / Guarantor Updated list of banks with which Tenant / Guarantor has accounts Updated list of currently held dispensary, processing, and cultivation licenses and a list of licenses to be acquired / locations where a license is being applied for Evidence of state cannabis licenses, and correspondence with state authority regarding status of issuance of permanent licensing where applicable (New York, for example) b. c. d. e. 2) Financial Information a. b. c. Copies of most recent sales agreements with dispensaries Copies of most recent equity financing documents and capitalization table Recent loan/credit agreements, security documents, letters of credit, indemnity letters and guarantees to which Tenant / Guarantor (or any of the entities in 1.a.) is a party (including intercompany loans) Current financial projections, business plans and internal budgets Any new documents pursuant to which Tenant / Guarantor is a guarantor or is otherwise contingently liable for the obligations of another entity Most recent investor presentation d. e. f. INSURANCE / LEGAL [FOR PROPERTY, GUARANTOR AND TENANT] 1) 2) 3) 4) Updated schedule of insurance policies, including broker, limits, retentions and coverage bases Any new notice of cancellation, termination or non-renewal or denial of liability under any policy Updated loss information for the past 5 years under any insurance policy Updated list of pending or threatened litigation and other claims (judicial, administrative and arbitration) by or against Tenant/ Guarantor or to which Tenant / Guarantor is a party All judgments or decrees to which Tenant / Guarantor or any of its properties is subject All notices and correspondence received from any governmental agency alleging any violation of law, rule or regulation, including those relating to any applicable state or local cannabis law, rule or regulation Updated list of any litigation concluded during the past 3 years with a description of the disposition 5) 6) 7) Such other documents or materials concerning the Property in the possession or under the reasonable control of Seller as may be reasonably requested by Buyer.

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SCHEDULE 2.0 ENVIRONMENTAL DISCLOSURE STATEMENT 1. Phase I Environmental Site Assessment dated July 22, 2021 and prepared by AEI Consultants as Project No. 442167.

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SCHEDULE 3.0 EXCLUDED PROPERTY None.

Exhibit 10.2

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FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS THIS FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this "Amendment") is entered into effective as of the 24th day of September 2021, by and between VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company LLC (the "Seller"), and IIP-NY 2 LLC, a Delaware limited liability company ("Buyer"). RECITALS A. WHEREAS, Seller and Buyer are parties to that certain Purchase and Sale Agreement and Joint Escrow Instructions dated as of September 1, 2021 (the "Existing PSA"), where Seller has agreed to sell to Buyer, and Buyer has agreed to purchase from Seller, Seller's right, title and interest in certain real property located in Perth, New York, as more particularly described therein; and B. WHEREAS, in accordance with Section 15.4 of the Existing PSA, Seller and Buyer desire to modify and amend the Existing PSA only in respects and on the conditions hereinafter stated. AGREEMENT NOW, THEREFORE, Seller and Buyer, in consideration of the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, agree as follows: 1. Definitions. For purposes of this Amendment, capitalized terms shall have the meanings ascribed to them in the Existing PSA unless otherwise defined herein. The Existing PSA, as amended by this Amendment, is referred to collectively herein as the "Agreement." From and after the date hereof, the term "Agreement," as used in the Existing PSA, shall mean the Existing PSA, as amended by this Amendment. 2. Purchase Price. The first sentence of Section 2.2 of the Existing PSA is hereby amended and restated in its entirety to read as follows: "The purchase price for the Property ("Purchase Price") shall be the sum of Ten Million Two Hundred Twenty-Five Thousand Dollars ($10,225,000.00)." 3. deleted in its Lease. The form of Lease Amendment attached as Exhibit H to the Existing PSA is hereby entirety and replaced with the form of Lease Amendment attached hereto as Exhibit H and incorporated herein by reference. From and after the date hereof, all references in the Agreement to the "Lease Amendment" shall mean and refer to the Lease Amendment attached to this Amendment as Exhibit H. 4. Effect of Amendment. Except as modified by this Amendment, the Existing PSA and all the covenants, agreements, terms, provisions and conditions thereof shall remain in full force and effect and are hereby ratified and affirmed. In the event of any conflict between the terms contained in this Amendment and the Existing PSA, the terms herein contained shall supersede and control the obligations and liabilities of the parties. 5. Miscellaneous. This Amendment becomes effective only upon execution and delivery hereof by Seller and Buyer. The captions of the paragraphs and subparagraphs in this Amendment are inserted and included solely for convenience and shall not be considered or given any effect in construing the provisions hereof. 6. Authority. Each of Seller and Buyer guarantees, warrants and represents that the individual or individuals signing this Amendment have the power, authority and legal capacity to sign this Amendment on behalf of and to bind all entities, corporations, partnerships, limited liability companies or other organizations on whose behalf such individual or individuals have signed.

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7. Counterparts; Facsimile and PDF Signatures. This Amendment may be executed in one or more counterparts, each of which, when taken together, shall constitute one and the same document. A facsimile or portable document format (PDF) signature on this Amendment shall be equivalent to, and have the same force and effect as, an original signature. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 2

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IN WITNESS WHEREOF, Seller and Buyer have executed this Amendment as of the date and year first above written. SELLER: VIREO 1-IEALTH OF NEW YORK, LLC, a New Yark limited liability company BUYER: liP-NY 2 LLC, a Delaware limited liability company By: Name: Brian Wolfe Title: Vice President, General Counsel and Secretary

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IN WITNESS WHEREOF, Seller and Buyer have executed this Amendment as of the date and year first above written. SELLER: VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company By: Name: John Heller Title: ChiefFinancial Officer BUYER: liP-NY 2 LLC, a Delaware limited liability company By: Name: Brian Wolfe Title: Vice President, General Counsel

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EXHIBIT H FORM OF LEASE AMENDMENT [See Attached]

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THIRD AMENDMENT TO LEASE AGREEMENT THIS THIRD AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is entered into as of September 24, 2021 (the “Amendment Effective Date”), by and between IIP-NY 2 LLC, a Delaware limited liability company (“Landlord”), and Vireo Health of New York, LLC, a New York limited liability company (“Tenant”). RECITALS A. WHEREAS, Landlord and Tenant are parties to that certain Lease Agreement dated as of October 23, 2017, as amended by that certain First Amendment to Lease Agreement dated as of December 7, 2018, and as further amended by that certain Second Amendment to Lease Agreement dated as of April 10, 2020 (collectively, the “Existing Lease”), whereby Tenant leases the premises from Landlord located at 256 County Route 117 in Perth, New York; and B. WHEREAS, Landlord and Tenant desire to modify and amend the Existing Lease only in the respects and on the conditions hereinafter stated. AGREEMENT NOW, THEREFORE, Landlord and Tenant, in consideration of the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound, agree as follows: 1. Definitions. For purposes of this Amendment, capitalized terms shall have the meanings ascribed to them in the Existing Lease unless otherwise defined herein. The Existing Lease, as amended by this Amendment, is referred to collectively herein as the “Lease.” From and after the date hereof, the term “Lease,” as used in the Existing Lease, shall mean the Existing Lease, as amended by this Amendment. 2. Expansion of Premises. Concurrent with the execution of this Amendment, Landlord closed on the purchase of certain real property located in Perth, New York (collectively, the “Additional Parcel”), as more particularly described in that certain Purchase and Sale Agreement and Joint Escrow Instructions dated August 31, 2021, by and between Landlord and Tenant (the “Additional Parcel Purchase Agreement”). Landlord desires to lease to Tenant, and Tenant desires to lease from Landlord, the Additional Parcel pursuant to the terms and conditions of the Lease. Accordingly, effective as of the Amendment Effective Date, Exhibit A to the Existing Lease is hereby deleted in its entirety and replaced with Exhibit A to this Amendment, and all references in the Lease to the “Premises” shall mean and refer to the real property described on Exhibit A attached to this Amendment, including the Buildings, shafts, cable runs, mechanical spaces, rooftop areas, landscaping, parking facilities, private drives and other improvements now or hereafter located thereon and appurtenances related thereto for use by Tenant in accordance with the Permitted Use. 3. Term. Section 3.1 of the Existing Lease is hereby amended and restated in its entirety as follows: "3.1. Term. The actual term of this Lease (as the same may be extended or earlier terminated in accordance with this Lease, the "Term") commenced on October 23, 2017 (the "Commencement Date") and shall end on September 23, 2041, subject to extension or earlier termination of this Lease as provided herein." 4. TI Allowance. Tenant has requested, and Landlord has agreed, to increase the TI Allowance by an additional Forty-Six Million Seventy-Five Thousand Dollars ($46,075,000.00) (the “Additional TI Allowance”). Accordingly, the first sentence of Section 5.1 of the Existing Lease is hereby amended and restated in its entirety as follows: "Tenant shall cause appropriate improvements consistent with the Permitted Use (the "Tenant Improvements") to be constructed in the Premises pursuant to the Work Letter attached hereto as Exhibit E (the "Work Letter") at a cost to Landlord not to exceed Forty-

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Nine Million Four Hundred Thirty-Five Thousand Dollars ($49,435,000.00) (the "TI Allowance")." In addition, the second sentence of Section 5.1 of the Existing Lease is hereby amended and restated in its entirety as follow: "The TI Allowance may be applied to the costs of (a) construction, (b) project review by Landlord (which fee shall not exceed Twenty Thousand Dollars ($20,000.00) plus any reasonable actual out-of-pocket third-party expenses incurred by Landlord), (c) commissioning of mechanical, electrical and plumbing systems by a licensed, qualified commissioning agent hired by Tenant, and review of such party’s commissioning report licensed, qualified commissioning agent hired by Landlord, (d) space planning, architect, engineering and other related services performed by third parties unaffiliated with Tenant, (e) building permits and other taxes, fees, charges and levies by governmental authorities for permits or for inspections of the Tenant Improvements, and (f) costs and expenses for labor, material, equipment and fixtures." In addition, the final sentence of Section 5.2 of the Existing Lease is hereby deleted in its entirety and replaced with the following: "In addition, Landlord’s obligation to disburse any of the TI Allowance in excess of Forty-Eight Million Nine Hundred Thirty-Five Thousand Dollars ($48,935,000.00) shall be conditional upon the satisfaction of the following: (a) Tenant's delivery to Landlord of a certificate of occupancy for the Premises suitable for the Permitted Use, as applicable; (b) Tenant's delivery to Landlord of a Certificate of Substantial Completion in the form of the American Institute of Architects document G704, executed by the project architect and the general contractor or such other form or certification as may be reasonably acceptable to Landlord; (c) Tenant's satisfaction of the conditions precedent to funding of the TI Allowance set forth in Section 6.3 of the Work Letter; and (d) there shall be no uncured event of default by Tenant under this Lease. Following the completion of the Tenant Improvements, Landlord may order, at Tenant’s expense, a current title report or lien search for the Premises to confirm that the Premises remains free and clear of all liens relating to the completion of the Tenant Improvements. Tenant agrees to promptly pay or reimburse Landlord for the costs relating to such title report or lien search upon receipt of an invoice from Landlord." 5. Section 18.2.6: Tenant Insurance. Section 18.2 of the Existing Lease is hereby amended to add the following new "At all times during construction Tenant shall maintain (or cause to be maintained, as applicable) in full force and effect an “all risk” builder’s risk completed value form, which form shall: (a) be on a non-reporting basis, (b) insure against all risks insured including, without limitation, fire and other perils normally included, including at Landlord’s option, terrorism, windstorm, earthquake and flood coverage, (c) for structural or non-structural renovation, cover 100% of any existing Building, (d) include permission to occupy the Premises, without restrictions, as appropriate, (d) have an agreed amount endorsement waiving co-insurance provisions, (e) include coverage for 100% of the reoccurring hard costs and soft costs, (f) cover losses suffered with respect to Tenant’s materials, equipment, machinery and/or supplies (whether on-site, in transit, or stored off-site) with a limit of no less than 100% of the replacement cost, (g) provide for no deductible in excess of $250,000, except with respect to earthquake, windstorm/named storm, and flood; and (h) otherwise be in form and substance reasonably acceptable to Landlord. Notwithstanding 2

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the foregoing, Landlord may elect to procure and maintain the coverage required pursuant to this Section 18.2.6 by providing notice to Tenant of such election." 6. Tenant Work Insurance Schedule. Exhibit E-1 of the Existing Lease is hereby deleted in its entirety and replaced with Exhibit E-1 attached to this Amendment. 7. Monthly Base Rent. Notwithstanding anything in the Existing Lease to the contrary, in consideration of the Additional TI Allowance, commencing on the Amendment Effective Date: (a) the monthly Base Rent shall increase by Four Hundred Ninety-Two Thousand Six Hundred Twenty-Five Dollars ($492,625.00) (the “Additional Base Rent”), provided that the Additional Base Rent shall be phased in during the sixteen (16) month period following the Amendment Effective Date as set forth below (such sixteen month period, the “Additional Base Rent Adjustment Period”); (b) in lieu of the Base Rent adjustments set forth in Section 6.5 of the Existing Lease, the Additional Base Rent shall be subject to an annual upward adjustment of two and three-quarters percent (2.75%) of the then-current Additional Base Rent, with the first such adjustment to become effective commencing on the first anniversary of the Amendment Effective Date, and subsequent adjustments to become effective on every successive annual anniversary of the Amendment Effective Date for so long as the Lease continues in effect; and (c) the Base Rent under the Existing Lease shall be adjusted to the same rental rate as the Additional Base Rent for the last five (5) years of the Term in accordance with this Amendment, subject to the adjustments set forth in the Lease, including the Base Rent adjustments set forth in Section 6.5 of the Existing Lease on each anniversary of the Commencement Date. For illustrative purposes, the chart below sets forth the incremental increases to Base Rent to account for the Additional Base Rent, subject to adjustment pursuant to this Section 7, to be phased in during the Additional Base Rent Adjustment Period, and the rent chart attached as Exhibit F to this Amendment sets forth the monthly aggregate Base Rent and Property Management Fee for the Term of the Lease, including the adjustments to Base Rent as set forth in the Lease. Additional Base Rent Adjustment Period: Amount of Additional Base Rent: Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13 Month 14 Month 15 Month 16 $30,789.06 $61,578.13 $92,367.19 $123,156.25 $153,945.31 $184,734.38 $215,523.44 $246,312.50 $277,101.56 $307,890.63 $338,679.69 $369,468.75 $411,264.90 $442,900.67 $474,536.43 $506,172.19 8. Security Deposit. In further consideration for the Additional TI Allowance, the Security Deposit is hereby increased by One Million Three Hundred Ninety Thousand Dollars ($1,390,000.00) (the “Additional Security Deposit”) to One Million Seven Hundred Fifty Thousand Dollars ($1,750,000.00), provided that the Additional Security Deposit shall be paid in installments in accordance with this Section 8. In connection with any funding of the TI Allowance, Landlord shall deduct from the amount of the TI Allowance requested by Tenant and approved by Landlord in connection with a Fund Request pursuant to Section 6.3 of the Work Letter (the “TI Allowance Payment”), a proportionate amount of the TI Allowance Payment to be retained by Landlord as part of the Additional Security Deposit (the “Additional Security Deposit Installment”), which proportionate amount shall be determined based upon the percentage derived from dividing the amount of the TI Allowance Payment by Fifty-Six Million Three Hundred 3

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Thousand Dollars ($56,300,000.00) until such time as the Additional Security Deposit has been fully funded. As an example, if the amount of the TI Allowance Payment is equal to $5,630,000 (i.e. 10% of $56,300,000), then Landlord shall retain an amount equal to $139,000 as pa1t of the Security Deposit (i.e. 10% of $1,390,000.00). ill addition, the penultimate sentence in Section6.4 of the Existing Lease is hereby deleted in its entirety. 9. Permitted Transfer. The first sentence ofSection 16.8 of the Existing Lease is hereby amended and restated in its entirety as follows: "Tenant may assign its entire interest under tlus Lease or sublease all or a pmtion of the Premises without the consent of Landlord to: (i) an affiliate, subsidiaq or parent of Tenant; (ii) any entity into wluch that Tenant or an affiliated party may merge or consolidate; (iii) any entity that acquires all or substantially all of the assets of Tenant; each a "Permitted Tmnsfer" and such transferee a "Permitted Tt·ansferee", provided that (a) Tenant notifies Landlord at least twenty (20) days prior to the effective date of any such Pemutted Transfer, (b) Tenant is not in default and such assignment or sublease is not a subterfuge by Tenant to avoid its obligations under tills Lease, (c) such Pennitted Transferee shall have a tangible net worth (not including goodwill as an asset) computed in accordance with generally accepted accotmting principles ("Net Worth") at least equal to the Net Worth of the original Tenant on the day inunediately preceding the effective date of such assignment or sublease and reasonably sufficient to comply with the obligations under this Lease, (d) no assignment or sublease relating to this Lease, whetlter with or without Landlord's consent, shall relieve Tenant from any liability tmder this Lease, (e) the liability of such Pemutted Transferee tmder either an assignment or sublease shall be joint and several with Tenant and each Guarantor; and (f) the ultimate parent company of any Pennitted Transferee executes a Guaranty in favor of Landlord substantially in the fonn attached hereto as Exhibit D." monthly Ad:dittonal and 50/100 Dollars ($578,482.50), subject to further adjustment as set fmih in Section 7 of tlus Amendment, including the adjustments to Base Rent tmder the Existing Lease for the last five (5) years of the Term. Within ten (10) days of receipt of an amendment to the Lease memorializing the adjustment of the Additional Base Rent pursuant to this Section 10 (the "Lease Amendment"), Tenant agre.es to execute and deliver such Lease Amendment to Landlord, provided Tenant's failw·e to timely deliver the Lease Amendment shall not delay or preclude the adjustments to the Additional Base Rent as set fmih herein nor shall such failure negate Tenant's liability therefor. Post-Closing Environmental Report and Remediation. Tenant acknowledges that prior to the 11. Cmnmencement Date, Tenant's contl·actor discovered an estimated 4,000 gallon No. 2 heating oil tmderground storage tank (the ''UST") on the no1ihem portion of the Additional Parcel and that upon discove1y, a release to the soil adjacent to the UST was observed and reported to the New York State Department of Enviromnental Conservation (''NYSDEC"). Tenant's consultant removed the UST prior to tl1e Cmnmencement Date and has removed or is in the process of removing impacted soil and tmde11aking grotmdwater and soil sampling to determine any fmiher remediation that may be required at the Prenlises. Tenant shall be required to diligently complete the removal of any 4

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impacted soils and the remediation of any contamination to the Premises related to the discovery of the UST and resulting release to the extent required by Applicable Laws, and Landlord’s insurance providers, at Tenant’s sole cost and expense. Tenant shall keep Landlord apprised of such remediation efforts and shall provide Landlord with copies of any notices and submittals to and from the NYSDEC with respect to such contamination and remediation and any reports issued in connection with such remediation. Landlord shall have the right to withhold from disbursements of the TI Allowance an amount equal to one hundred fifty percent (150%) of the estimated remaining cost to complete the remediation of the Premises in accordance with all Applicable Laws (“Completion of Remediation”) until such time as Landlord has received evidence of the Completion of Remediation, including an updated Phase II Environmental Assessment confirming that no further action or remediation is recommended. Furthermore, in the event the estimated costs of the remediation will exceed Thirty Thousand Dollars ($30,000.00), Landlord may require Tenant to deliver a cash deposit equal to the estimated costs for Landlord to hold in escrow pending completion of the remediation to Landlord’s reasonable satisfaction. For the avoidance of doubt, Tenant shall indemnify, save, defend (at Landlord’s option and with counsel reasonably acceptable to Landlord) and hold the Landlord Indemnitees harmless from and against any and all Claims of any kind or nature that arise during or after the Term as a result of or in connection with the discovery of the UST, any resulting release and the remediation of the Premises. 12. Broker. Tenant represents and warrants that it has not dealt with any broker or agent in the negotiation for or the obtaining of this Amendment and agrees to reimburse, indemnify, save, defend (at Landlord’s option and with counsel reasonably acceptable to Landlord, at Tenant’s sole cost and expense) and hold harmless the Landlord Indemnitees for, from and against any and all cost or liability for compensation claimed by any such broker or agent employed or engaged by it or claiming to have been employed or engaged by it. 13. No Default. Tenant represents, warrants and covenants that, to the best of Tenant’s knowledge, Landlord and Tenant are not in default of any of their respective obligations under the Existing Lease and no event has occurred that, with the passage of time or the giving of notice (or both) would constitute a default by either Landlord or Tenant thereunder. 14. Effect of Amendment. Except as modified by this Amendment, the Existing Lease and all the covenants, agreements, terms, provisions and conditions thereof shall remain in full force and effect and are hereby ratified and affirmed. In the event of any conflict between the terms contained in this Amendment and the Existing Lease, the terms herein contained shall supersede and control the obligations and liabilities of the parties. 15. Successors and Assigns. Each of the covenants, conditions and agreements contained in this Amendment shall inure to the benefit of and shall apply to and be binding upon the parties hereto and their respective heirs, legatees, devisees, executors, administrators and permitted successors and assigns and sublessees. Nothing in this section shall in any way alter the provisions of the Lease restricting assignment or subletting. 16. Miscellaneous. This Amendment becomes effective only upon execution and delivery hereof by Landlord and Tenant. The captions of the paragraphs and subparagraphs in this Amendment are inserted and included solely for convenience and shall not be considered or given any effect in construing the provisions hereof. All exhibits hereto are incorporated herein by reference. Submission of this instrument for examination or signature by Tenant does not constitute a reservation of or option for a lease, and shall not be effective as a lease, lease amendment or otherwise until execution by and delivery to both Landlord and Tenant. 17. Authority. Tenant guarantees, warrants and represents that the individual or individuals signing this Amendment have the power, authority and legal capacity to sign this Amendment on behalf of and to bind all entities, corporations, partnerships, limited liability companies, joint venturers or other organizations and entities on whose behalf such individual or individuals have signed. 18. Counterparts; Facsimile and PDF Signatures. This Amendment may be executed in one or more counterparts, each of which, when taken together, shall constitute one and the same document. A facsimile or portable document format (PDF) signature on this Amendment shall be equivalent to, and have the same force and effect as, an original signature. 5

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EXHIBIT F MONTHLY BASE RENT AND PROPERTY MANAGEMENT FEE SCHEDULE [See Attached]

NEW MICROSOFT WORD DOCUMENT_10_2_PAGE_16.GIF

Management fee Month Initial Base Rent Initial Management fee Additional Base Rent Additional Management fee Total Base Rent and 9/1/2021 93,686.66 1,405.30 7,184.11 1,724.19 104,000.26 10/1/2021 94,638.64 1,419.58 37,973.18 7,389.38 141,420.78 11/1/2021 96,965.69 1,454.49 68,762.24 7,389.38 174,571.80 12/1/2021 96,965.69 1,454.49 99,551.30 7,389.38 205,360.86 1/1/2022 96,965.69 1,454.49 130,340.36 7,389.38 236,149.92 2/1/2022 96,965.69 1,454.49 161,129.43 7,389.38 266,938.99 3/1/2022 96,965.69 1,454.49 191,918.49 7,389.38 297,728.05 4/1/2022 96,965.69 1,454.49 222,707.55 7,389.38 328,517.11 5/1/2022 96,965.69 1,454.49 253,496.61 7,389.38 359,306.17 6/1/2022 96,965.69 1,454.49 284,285.68 7,389.38 390,095.24 7/1/2022 96,965.69 1,454.49 315,074.74 7,389.38 420,884.30 8/1/2022 96,965.69 1,454.49 345,863.80 7,389.38 451,673.36 9/1/2022 96,965.69 1,454.49 379,221.19 7,436.79 485,078.16 10/1/2022 97,950.99 1,469.26 418,646.58 7,592.58 525,659.41 11/1/2022 100,359.49 1,505.39 450,282.34 7,592.58 559,739.80 12/1/2022 100,359.49 1,505.39 481,918.11 7,592.58 591,375.57 1/1/2023 100,359.49 1,505.39 506,172.19 7,592.58 615,629.65 2/1/2023 100,359.49 1,505.39 506,172.19 7,592.58 615,629.65 3/1/2023 100,359.49 1,505.39 506,172.19 7,592.58 615,629.65 4/1/2023 100,359.49 1,505.39 506,172.19 7,592.58 615,629.65 5/1/2023 100,359.49 1,505.39 506,172.19 7,592.58 615,629.65 6/1/2023 100,359.49 1,505.39 506,172.19 7,592.58 615,629.65 7/1/2023 100,359.49 1,505.39 506,172.19 7,592.58 615,629.65 8/1/2023 100,359.49 1,505.39 506,172.19 7,592.58 615,629.65 9/1/2023 100,359.49 1,505.39 509,420.13 7,641.30 618,926.31 10/1/2023 101,379.27 1,520.69 520,091.93 7,801.38 630,793.27 11/1/2023 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 12/1/2023 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 1/1/2024 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 2/1/2024 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 3/1/2024 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 4/1/2024 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 5/1/2024 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 6/1/2024 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 7/1/2024 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 8/1/2024 103,872.07 1,558.08 520,091.93 7,801.38 633,323.46 9/1/2024 103,872.07 1,558.08 523,429.19 7,851.44 636,710.78 10/1/2024 104,927.54 1,573.91 534,394.46 8,015.92 648,911.83 11/1/2024 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 12/1/2024 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 1/1/2025 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 2/1/2025 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 3/1/2025 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 4/1/2025 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 5/1/2025 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 6/1/2025 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 7/1/2025 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 8/1/2025 107,507.59 1,612.61 534,394.46 8,015.92 651,530.58 9/1/2025 107,507.59 1,612.61 537,823.49 8,067.35 655,011.04 10/1/2025 108,600.01 1,629.00 549,090.31 8,236.35 667,555.67 11/1/2025 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 12/1/2025 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 1/1/2026 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 2/1/2026 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 3/1/2026 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 4/1/2026 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 5/1/2026 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 6/1/2026 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 7/1/2026 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 8/1/2026 111,270.36 1,669.06 549,090.31 8,236.35 670,266.08 9/1/2026 111,270.36 1,669.06 552,613.64 8,289.20 673,842.26 10/1/2026 112,401.01 1,686.02 564,190.29 8,462.85 686,740.17 11/1/2026 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 12/1/2026 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 1/1/2027 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43

NEW MICROSOFT WORD DOCUMENT_10_2_PAGE_17.GIF

2/1/2027 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 3/1/2027 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 4/1/2027 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 5/1/2027 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 6/1/2027 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 7/1/2027 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 8/1/2027 115,164.82 1,727.47 564,190.29 8,462.85 689,545.43 9/1/2027 115,164.82 1,727.47 567,810.51 8,517.16 693,219.96 10/1/2027 116,335.04 1,745.03 579,705.52 8,695.58 706,481.17 11/1/2027 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 12/1/2027 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 1/1/2028 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 2/1/2028 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 3/1/2028 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 4/1/2028 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 5/1/2028 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 6/1/2028 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 7/1/2028 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 8/1/2028 119,195.59 1,787.93 579,705.52 8,695.58 709,384.62 9/1/2028 119,195.59 1,787.93 583,425.30 8,751.38 713,160.20 10/1/2028 120,406.77 1,806.10 595,647.42 8,934.71 726,795.00 11/1/2028 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 12/1/2028 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 1/1/2029 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 2/1/2029 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 3/1/2029 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 4/1/2029 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 5/1/2029 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 6/1/2029 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 7/1/2029 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 8/1/2029 123,367.44 1,850.51 595,647.42 8,934.71 729,800.08 9/1/2029 123,367.44 1,850.51 599,469.49 8,992.04 733,679.48 10/1/2029 124,621.01 1,869.32 612,027.72 9,180.42 747,698.47 11/1/2029 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 12/1/2029 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 1/1/2030 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 2/1/2030 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 3/1/2030 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 4/1/2030 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 5/1/2030 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 6/1/2030 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 7/1/2030 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 8/1/2030 127,685.30 1,915.28 612,027.72 9,180.42 750,808.72 9/1/2030 127,685.30 1,915.28 615,954.90 9,239.32 754,794.80 10/1/2030 128,982.75 1,934.74 628,858.48 9,432.88 769,208.85 11/1/2030 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 12/1/2030 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 1/1/2031 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 2/1/2031 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 3/1/2031 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 4/1/2031 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 5/1/2031 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 6/1/2031 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 7/1/2031 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 8/1/2031 132,154.29 1,982.31 628,858.48 9,432.88 772,427.96 9/1/2031 132,154.29 1,982.31 632,893.66 9,493.40 776,523.66 10/1/2031 133,497.15 2,002.46 646,152.09 9,692.28 791,343.98 11/1/2031 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 12/1/2031 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 1/1/2032 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 2/1/2032 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 3/1/2032 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 4/1/2032 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 5/1/2032 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 6/1/2032 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76

NEW MICROSOFT WORD DOCUMENT_10_2_PAGE_18.GIF

7/1/2032 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 8/1/2032 136,779.69 2,051.70 646,152.09 9,692.28 794,675.76 9/1/2032 136,779.69 2,051.70 650,298.23 9,754.47 798,884.09 10/1/2032 138,169.55 2,072.54 663,921.27 9,958.82 814,122.18 11/1/2032 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 12/1/2032 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 1/1/2033 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 2/1/2033 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 3/1/2033 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 4/1/2033 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 5/1/2033 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 6/1/2033 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 7/1/2033 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 8/1/2033 141,566.98 2,123.50 663,921.27 9,958.82 817,570.57 9/1/2033 141,566.98 2,123.50 668,181.43 10,022.72 821,894.63 10/1/2033 143,005.48 2,145.08 682,179.10 10,232.69 837,562.35 11/1/2033 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 12/1/2033 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 1/1/2034 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 2/1/2034 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 3/1/2034 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 4/1/2034 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 5/1/2034 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 6/1/2034 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 7/1/2034 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 8/1/2034 146,521.82 2,197.83 682,179.10 10,232.69 841,131.44 9/1/2034 146,521.82 2,197.83 686,556.42 10,298.35 845,574.42 10/1/2034 148,010.67 2,220.16 700,939.03 10,514.09 861,683.95 11/1/2034 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 12/1/2034 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 1/1/2035 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 2/1/2035 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 3/1/2035 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 4/1/2035 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 5/1/2035 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 6/1/2035 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 7/1/2035 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 8/1/2035 151,650.08 2,274.75 700,939.03 10,514.09 865,377.95 9/1/2035 151,650.08 2,274.75 705,436.72 10,581.55 869,943.10 10/1/2035 153,191.04 2,297.87 720,214.85 10,803.22 886,506.98 11/1/2035 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 12/1/2035 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 1/1/2036 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 2/1/2036 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 3/1/2036 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 4/1/2036 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 5/1/2036 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 6/1/2036 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 7/1/2036 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 8/1/2036 156,957.83 2,354.37 720,214.85 10,803.22 890,330.27 9/1/2036 141,067.19 2,116.01 724,836.23 10,872.54 878,891.97 10/1/2036 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 11/1/2036 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 12/1/2036 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 1/1/2037 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 2/1/2037 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 3/1/2037 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 4/1/2037 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 5/1/2037 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 6/1/2037 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 7/1/2037 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 8/1/2037 88,855.07 1,332.83 740,020.76 11,100.31 841,308.97 9/1/2037 89,425.22 1,341.38 744,769.23 11,171.54 846,707.37 10/1/2037 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 11/1/2037 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96

NEW MICROSOFT WORD DOCUMENT_10_2_PAGE_19.GIF

12/1/2037 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 1/1/2038 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 2/1/2038 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 3/1/2038 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 4/1/2038 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 5/1/2038 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 6/1/2038 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 7/1/2038 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 8/1/2038 91,298.58 1,369.48 760,371.33 11,405.57 864,444.96 9/1/2038 91,884.41 1,378.27 765,250.38 11,478.76 869,991.82 10/1/2038 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 11/1/2038 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 12/1/2038 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 1/1/2039 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 2/1/2039 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 3/1/2039 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 4/1/2039 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 5/1/2039 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 6/1/2039 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 7/1/2039 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 8/1/2039 93,809.29 1,407.14 781,281.54 11,719.22 888,217.19 9/1/2039 94,411.23 1,416.17 786,294.76 11,794.42 893,916.58 10/1/2039 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 11/1/2039 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 12/1/2039 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 1/1/2040 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 2/1/2040 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 3/1/2040 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 4/1/2040 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 5/1/2040 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 6/1/2040 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 7/1/2040 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 8/1/2040 96,389.05 1,445.84 802,766.78 12,041.50 912,643.17 9/1/2040 97,007.55 1,455.11 807,917.87 12,118.77 918,499.30 10/1/2040 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 11/1/2040 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 12/1/2040 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 1/1/2041 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 2/1/2041 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 3/1/2041 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 4/1/2041 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 5/1/2041 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 6/1/2041 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 7/1/2041 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 8/1/2041 99,039.75 1,485.60 824,842.87 12,372.64 937,740.86 9/1/2041 75,930.48 1,138.96 632,379.53 9,485.69 718,934.66

Exhibit 10.3

NEW MICROSOFT WORD DOCUMENT_10_3_PAGE_01.GIF

NEW MICROSOFT WORD DOCUMENT_10_3_PAGE_02.GIF

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Thousand Dollars ($56,300,000.00) until such time as the Additional Security Deposit has been fully funded. As an example, if the amount of the TI Allowance Payment is equal to $5,630,000 (i.e. 10% of $56,300,000), then Landlord shall retain an amount equal to $139,000 as pa1t of the Security Deposit (i.e. 10% of $1,390,000.00). ill addition, the penultimate sentence in Section6.4 of the Existing Lease is hereby deleted in its entirety. 9. Permitted Transfer. The first sentence ofSection 16.8 of the Existing Lease is hereby amended and restated in its entirety as follows: "Tenant may assign its entire interest under tlus Lease or sublease all or a pmtion of the Premises without the consent of Landlord to: (i) an affiliate, subsidiaq or parent of Tenant; (ii) any entity into wluch that Tenant or an affiliated party may merge or consolidate; (iii) any entity that acquires all or substantially all of the assets of Tenant; each a "Permitted Tmnsfer" and such transferee a "Permitted Tt·ansferee", provided that (a) Tenant notifies Landlord at least twenty (20) days prior to the effective date of any such Pemutted Transfer, (b) Tenant is not in default and such assignment or sublease is not a subterfuge by Tenant to avoid its obligations under tills Lease, (c) such Pennitted Transferee shall have a tangible net worth (not including goodwill as an asset) computed in accordance with generally accepted accotmting principles ("Net Worth") at least equal to the Net Worth of the original Tenant on the day inunediately preceding the effective date of such assignment or sublease and reasonably sufficient to comply with the obligations under this Lease, (d) no assignment or sublease relating to this Lease, whetlter with or without Landlord's consent, shall relieve Tenant from any liability tmder this Lease, (e) the liability of such Pemutted Transferee tmder either an assignment or sublease shall be joint and several with Tenant and each Guarantor; and (f) the ultimate parent company of any Pennitted Transferee executes a Guaranty in favor of Landlord substantially in the fonn attached hereto as Exhibit D." the monthly Ad:dittonal Two and 50/100 Dollars ($578,482.50), subject to further adjustment as set fmih in Section 7 of tlus Amendment, including the adjustments to Base Rent tmder the Existing Lease for the last five (5) years of the Term. Within ten (10) days of receipt of an amendment to the Lease memorializing the adjustment of the Additional Base Rent pursuant to this Section 10 (the "Lease Amendment"), Tenant agre.es to execute and deliver such Lease Amendment to Landlord, provided Tenant's failw·e to timely deliver the Lease Amendment shall not delay or preclude the adjustments to the Additional Base Rent as set fmih herein nor shall such failure negate Tenant's liability therefor. Post-Closing Environmental Report and Remediation. Tenant acknowledges that prior to the 11. Cmnmencement Date, Tenant's contl·actor discovered an estimated 4,000 gallon No. 2 heating oil tmderground storage tank (the ''UST") on the no1ihem portion of the Additional Parcel and that upon discove1y, a release to the soil adjacent to the UST was observed and reported to the New York State Department of Enviromnental Conservation (''NYSDEC"). Tenant's consultant removed the UST prior to tl1e Cmnmencement Date and has removed or is in the process of removing impacted soil and tmde11aking grotmdwater and soil sampling to determine any fmiher remediation that may be required at the Prenlises. Tenant shall be required to diligently complete the removal of any 4

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date and year first above written. LANDLORD: liP-NY 2 LLC, a Delaware limited liability company By: Name: Title: Brian Wolfe Vice President, General Counsel a d Secretary TENANT: VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company By: Name: John Heller Title: ChiefFinancial Officer

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IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the date and year first above written. LANDLORD: liP-NY 2 LLC, a Delaware limited liability company By: Name: Title: Brian Wolfe Vice President, General Counsel and Secretary TENANT: VIREO HEALTH OF NEW YORK, LLC, a New York limited liability company

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EXHIBIT F MONTHLY BASE RENT AND PROPERTY MANAGEMENT FEE SCHEDULE [See Attached]

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Exhibit 31.1

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Kyle E. Kingsley, certify that:

I have reviewed this Quarterly Report on Form 10-Q of Goodness Growth Holdings, Inc.;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

(b)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 10, 2021


By:	/s/ Kyle E. Kingsley
	Kyle E. Kingsley
	Chief Executive Officer

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, John A. Heller, certify that:

I have reviewed this Quarterly Report on Form 10-Q of Goodness Growth Holdings, Inc.;

(a)

(b)

(c)

(a)

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 10, 2021


By:	/s/ John A. Heller
	John A. Heller
	Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the report of Goodness Growth Holdings, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned, in the capacities and on the dates indicated below, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ Kyle E. Kingsley
Kyle E. Kingsley
Chief Executive Officer
November 10, 2021

/s/ John A. Heller
John A. Heller
Chief Financial Officer
November 10, 2021