IM Cannabis Completes Sale of European Operations to CEO-Owned Slil

IM Cannabis Corp. (IMCC ) on September 29, 2026, announced the completion of its sale of all issued and outstanding shares of I.M.C. Holdings Ltd., the vehicle that held its European-focused operations, to Slil.com Holding Ltd., a company beneficially owned and controlled by IM Cannabis chief executive officer Oren Shuster. The transaction was carried out under a definitive share purchase agreement dated August 16, 2026, among IM Cannabis, Slil and IMC Holdings, and closed following satisfaction or waiver, as applicable, of the agreement’s conditions to closing.

Before closing, IMC Holdings completed a pre-closing reorganization under which IM Cannabis’s Israeli operations were transferred out of IMC Holdings and retained by the company. Following the reorganization, IMC Holdings held as its only material assets its direct or indirect equity interests in Adjupharm GmbH, Xinteza API Ltd. and Shiran Societe Anonyme — together designated the Target Subsidiaries — along with certain liabilities that remained in IMC Holdings immediately prior to closing and continued as obligations of IMC Holdings following Slil’s acquisition.

IM Cannabis said it expects the transaction to improve its shareholders’ equity and working capital, reduce the liabilities associated with IMC Holdings reflected in its consolidated financial position, and streamline its corporate structure. Based on management’s current unaudited pro forma analysis, the company expects the transaction to result in an improvement of approximately C$3 million in shareholders’ equity, while stating that the actual accounting impact may differ from the estimate and will be reflected in its financial statements for the applicable reporting period. Following completion, the company said it intends to focus its resources on its retained Israeli medical cannabis operations while continuing to evaluate additional opportunities.

Consideration and Retained Liabilities

Consideration for the transaction consisted of a C$3,000,000 advance payment previously made by Slil to the company, receipt of which is acknowledged in the share purchase agreement, together with Slil’s acquisition of IMC Holdings with the Retained Liabilities remaining in IMC Holdings. Under the agreement, the aggregate Retained Liabilities of IMC Holdings were not to exceed C$9,400,000, subject to adjustment by mutual agreement of the parties. The amount excludes direct liabilities of the Target Subsidiaries, to which the cap does not apply. No securities of IM Cannabis or IMC Holdings were issued or exchanged as consideration in connection with the transaction.

Board Review and Related-Party Exemptions

In connection with the transaction, the company’s board of directors established a special committee composed solely of independent directors to review, consider and evaluate the transaction. The special committee reviewed the terms of the transaction and recommended that the board approve it. Shuster declared his interest in the transaction and did not participate in or vote on its approval. Beta Finance T.Y.S Ltd., an arm’s-length financial consulting firm engaged by the board, provided a financial analysis to assist the special committee and the board in evaluating the transaction.

The transaction constituted a related party transaction within the meaning of Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions, because Slil is beneficially owned and controlled by Shuster, the company’s chief executive officer, a director, securityholder and debtholder. The company relied on the financial hardship exemptions from the instrument’s formal valuation requirement and minority approval requirement under sections 5.5(g) and 5.7(1)(e), respectively.

The company said it relied on those exemptions on the basis that it was in serious financial difficulty; that the transaction was designed to improve its financial position; that the circumstances described in section 5.5(f) of the instrument were not applicable; that the board, acting in good faith, and at least two-thirds of the company’s independent directors, acting in good faith, determined that the first two conditions applied and that the terms of the transaction were reasonable in the company’s circumstances; and that there was no requirement, corporate or otherwise, to hold a meeting to obtain approval of holders of any class of affected securities. The financial analysis provided by Beta Finance did not constitute a formal valuation within the meaning of MI 61-101, the company said.

The closing follows the company’s August 17, 2026, announcement that it had entered into the share purchase agreement, made further to a June 18, 2026, press release. The company said at the time that closing was 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 for closing of September 30, 2026. It also said then that it expected to close less than 21 days after filing the material change report for the transaction, calling the shorter period reasonable and necessary given its financial condition, liquidity position, debt obligations and the anticipated benefits of completing the transaction on an expedited basis.

The company said further details regarding completion of the transaction will be provided in a material change report to be filed in accordance with applicable securities laws.