IM Cannabis To Raise Up To $5.5M Via Private Placement Offerings

IM Cannabis Corp. IMCC IMCC announced a non-brokered private placement of a minimum of 400,000 units and a maximum of 2.96 million units of the company at a price of $1.25 per unit for aggregate gross proceeds of a minimum of $500,000 and a maximum of $3.7 million, which will be offered for sale to purchasers resident in Canada (except Quebec) and/or other qualifying jurisdictions pursuant to the listed issuer financing exemption under Part 5A of National Instrument 45-106 – Prospectus exemptions. Each unit consists of one common share of the company and one common share purchase warrant. Each warrant entitles its holder to purchase one additional common share at an exercise price of $1.50 for a period of 36 months from the date of issue.

The listed issuer financing exemption offering will be led by Marc Lustig, executive chairman of the company. The listed issuer financing exemption offering is expected to be completed in multiple closings, with the first closing expected to occur on or about January 16, 2023 and the final closing to occur no later than March 2, 2023.

Concurrent with the listed issuer financing exemption offering, IMC is selling, on a non-brokered private placement basis, an additional 2 million units on the same terms and at the same price for additional aggregate gross proceeds of $2.5 million. The concurrent offering will be led by company insiders, including Oren Shuster, CEO and director of the company. Closing of the concurrent offering is expected to occur on or about January 16, 2023. The aggregate gross proceeds from the listed issuer financing exemption offering and the concurrent offering shall be up to $5.5 million.

The company intends to use the net proceeds from each of the listed issuer financing exemption offering and the concurrent offering for general working capital purposes.

None of the securities have been registered under the United States Securities Act of 1933, as amended, or any state securities laws. Accordingly, the units may not be offered or sold within the United States, its territories or possessions, any state of the United States or the District of Columbia or to, or for the account or benefit of, U.S. persons unless registered under the U.S. Securities Act and all applicable state securities laws or an exemption from such registration requirements is available.

Update on Trichome Financial Corp. Insolvency Proceedings

On January 9, 2023, the Ontario Superior Court of Justice issued an order in respect of a motion brought by Trichome Financial Corp. and certain of its wholly-owned subsidiaries (collectively with Trichome, the "Trichome Group") to approve, among other things: the sale and investment solicitation process (the "SISP") in respect of the business and assets of the Trichome Group; and a stalking horse share purchase agreement between the Trichome Group and L5 Capital Inc. dated December 12, 2022, solely for the purposes of acting as the stalking horse bid in the SISP. The SISP establishes a process to solicit interest for the sale of any or all of the Trichome Group's businesses and assets.

At the conclusion of the SISP, and pursuant to its terms, if the stalking horse bid is selected as the successful bid, the Trichome Group will seek an approval and vesting order (an "AVO") from the court authorizing the Trichome Group to proceed with the transaction contemplated under the stalking horse purchase agreement. Pursuant to the stalking horse purchase agreement, the purchaser will acquire all of the issued and outstanding shares in the capital of Trichome JWC Acquisition Corp., MYM Nutraceuticals Inc., and their respective subsidiaries, Trichome Retail Corp., MYM International Brands Inc. and Highland Grow Inc. The consideration payable under the stalking horse purchase agreement is approximately CA$6.3 million and includes a base cash purchase price of CA$5 million and certain deferred consideration payable pursuant to secured limited recourse promissory notes.

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