Institutional Investor Backs IM Cannabis With US$225,000 Note

IM Cannabis Corp. (IMCC ), a medical cannabis company with operations in Israel and Germany, closed a US$225,000 convertible note financing in a private placement with an institutional investor on September 2, 2026, according to the company’s announcement.

Under a note purchase agreement between the company and the lender dated September 2, 2026, IM Cannabis issued a note in the principal amount of US$225,000 with an original issuance discount of 10%. The September Note bears interest at a rate of 8% per annum, increasing to 14% upon the occurrence and continuation of an event of default as defined in the note. The note is not repayable in cash, and the company’s obligations under it will be satisfied solely through the issuance of common shares upon conversion.

The conversion price is set at the lower of a fixed price of US$3.328 per common share or 90% of the lowest daily volume-weighted average price during the 20 consecutive trading days preceding the conversion date, subject to a floor price of US$0.665692. The note includes customary limitations, including a 4.99% beneficial ownership cap.

In connection with the note, the company issued a warrant to purchase up to 77,855 common shares at an exercise price of C$4.63 per share. The warrants became immediately exercisable on their issuance date, September 2, 2026, and expire five years after issuance, on September 2, 2031.

IM Cannabis said it intends to use the net proceeds from the note for general corporate purposes. In connection with the note purchase agreement, the company agreed to reserve sufficient common shares for issuance upon conversion of the note and exercise of the warrants, to file a resale registration statement on Form F-3 with the U.S. Securities and Exchange Commission, and to use commercially reasonable efforts to secure its effectiveness within the timeframes agreed with the lender.

All securities issued under the financing are subject to a four month and one day hold period from the date of issuance and to applicable legends required under the U.S. Securities Act of 1933, as amended. The private placement was made in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act and applicable Canadian securities laws. Accordingly, the securities may not be offered or sold in the United States or Canada except pursuant to an effective registration statement or an applicable exemption from registration requirements.

Earlier Convertible Note Financings in 2026

The September financing follows convertible note placements the company announced on July 1, 2026, and August 7, 2026. On July 1, 2026, IM Cannabis closed a US$225,000 convertible note financing with an institutional investor under a note purchase agreement dated the same day. The July note carried the same 10% original issuance discount and an 8% annual interest rate rising to 14% upon default, with a fixed conversion price of US$0.152 per share and a floor price of US$0.0303. In connection with that note, the company issued warrants to purchase up to 1,483,386 common shares at C$0.22 per share, immediately exercisable and expiring July 1, 2031.

On August 7, 2026, the company closed a US$250,000 convertible note under a note purchase agreement dated August 6, 2026, on the same interest, discount, and conversion structure, with a fixed conversion price of US$0.122 per share and a floor price of US$0.02436. The accompanying warrants covered up to 2,052,545 common shares at an exercise price of C$0.17 per share and expire on August 7, 2031.

On August 27, 2026, the company’s common shares commenced trading on the Nasdaq Capital Market on a 30:1 post-consolidated basis. The consolidation reduced the outstanding common shares from 18,567,650 to 618,899, subject to rounding for fractional shares, and the exercise and conversion prices and the number of shares issuable under the company’s outstanding convertible securities were proportionately adjusted. The company’s IMCC trading symbol remained unchanged, and new CUSIP and ISIN numbers were assigned.

Pending Sale of European-Focused Assets

On August 17, 2026, IM Cannabis announced it had entered into a definitive share purchase agreement dated August 16, 2026, with Slil.com Holding Ltd. and I.M.C. Holdings Ltd. to sell all of the issued and outstanding shares of IMC Holdings. Prior to closing, IMC Holdings will complete a pre-closing reorganization under which the company’s Israeli operations will be transferred out of IMC Holdings and retained by IM Cannabis. Following the reorganization, IMC Holdings is expected to hold, as its material assets, equity interests in Adjupharm GmbH, Xinteza API Ltd., and Shiran Societe Anonyme, together with certain liabilities retained with IMC Holdings or assumed by Slil.

Consideration consists of C$3,000,000 in prior advance payments made by Slil and an affiliate, together with Slil’s assumption of retained liabilities that may not materially exceed C$9,400,000 in the aggregate unless otherwise adjusted by mutual agreement of the parties. No securities of IM Cannabis or IMC Holdings are being issued or exchanged as part of the transaction. Based on management’s current pro forma analysis, the company expects the transaction to result in an improvement of approximately C$3 million in shareholders’ equity. Closing is subject to customary conditions, including completion of the pre-closing reorganization, receipt of a valid tax certificate from the Israel Tax Authority, and other required consents and approvals, with an outside date of September 30, 2026.

The transaction constitutes a related party transaction under Multilateral Instrument 61-101 because Slil is beneficially owned and controlled by Oren Shuster, the company’s chief executive officer and a director, securityholder, and debtholder. The company said it intends to rely on the financial hardship exemptions from the formal valuation and minority approval requirements under that instrument.

Following completion of the pending transactions announced on August 17, 2026, the company expects to retain its Israeli medical cannabis operations, and the German operations will be sold, the September 2 announcement stated. IM Cannabis operates a medical cannabis platform serving patients in Israel and, through Adjupharm GmbH, Germany. In Israel, the company’s subsidiaries import and distribute cannabis to medical patients, and the company operates medical cannabis retail pharmacies and online platforms.