IM Cannabis Closes Acquisition of MYM Nutraceuticals

 

TORONTO, CANADA, and GLIL YAM, ISRAEL – July 9, 2021 – IM Cannabis Corp. (“IMC” or the  “Company”) (NASDAQ: IMCC, CSE: IMCC), a multi-country operator (“MCO”) in the medical and adult-use recreational cannabis sectors with operations in Israel, Germany and Canada, and MYM Nutraceuticals Inc. (“MYM”), a Canadian cultivator, processor, and distributor of premium cannabis, are pleased to announce, further to IMC’s press release on July 6, 2021, the closing of IMC’s acquisition of MYM Nutraceuticals Inc. (“MYM”) (CSE:MYM), previously announced on April 1, 2021 (the “Transaction”). The Transaction was completed pursuant to a plan of arrangement under the Business Corporations Act (British Columbia). 

“We are extremely pleased to have closed the acquisition of MYM. Strategically, this Transaction  is consistent with IMC’s focus on premium and super premium segments of the cannabis market  for consumers and patients in all markets. With coast-to-coast distribution, including a strong  leadership position in Eastern Canada, Highland Grow will further enhance our distribution capabilities, fast-track our entrance into new markets and results in additional opportunities to  export premium cannabis products to Israel and Germany,” said Oren Shuster, CEO of IMC. 

The Transaction was implemented pursuant to the terms and conditions of an arrangement  agreement dated March 31, 2021 between IMC, MYM and Trichome Financial Corp. (“Trichome”),  which resulted in the acquisition by IMC of all of the issued and outstanding shares of MYM (the “MYM Shares”) in exchange for consideration of 0.022 of a common share for each share of IMC (each full share, an “IMC Share”) for each MYM Share. 

In connection with the Transaction, a total of 10,073,436 IMC Shares have been issued to the former holders of MYM Shares, resulting in former MYM shareholders holding approximately 15% of the total number of issued and outstanding IMC Shares (based on 67,156,470 IMC Shares  issued and outstanding immediately after closing). 

To obtain their IMC Shares, former registered shareholders of MYM must complete the letter of transmittal mailed to them and submit it to Computershare Investor Services and otherwise follow  the instructions contained in such letter of transmittal. Further details can be found in the  management information circular of MYM dated June 3, 2021 in connection with the special meeting of holders of MYM shares held on July 5, 2021 to approve the Transaction. A copy of the  circular is available on MYM’s SEDAR profile at www.sedar.com

It is expected that the MYM shares will be delisted from the Canadian Securities Exchange (the  “CSE”) on or about July 9, 2021. MYM will also apply to cease to be a reporting issuer in the  jurisdictions in which it is currently a reporting issuer. 

MYM’s directors and officers and Biome Grow Inc., which collectively held approximately 43% of  the MYM Shares, have each entered into lock-up agreements restricting the resale of the IMC Shares acquired by such individuals upon closing of the Transaction to a staggered 1/6 release per  month of such shares for a period of 6 months (the “Lock-Up Agreements”). 

Following the completion of the Transaction, IMC, indirectly through its wholly-owned subsidiary  Trichome Financial Corp., has beneficial ownership and control over 100% of the issued and  outstanding MYM shares. Prior to the Transaction, IMC did not directly or indirectly hold MYM  shares. A copy of the applicable early warning report concerning the acquisition of MYM shares will be filed under MYM’s profile at www.sedar.com

Desjardins Capital Markets and Torys LLP acted as financial advisor and legal counsel,  respectively, to IMC. Dentons Canada LLP acted as legal counsel to Desjardins Capital Markets. Hyperion Capital Inc. and Borden Ladner Gervais LLP acted as financial advisor and legal counsel,  respectively, to MYM. Blake, Cassels & Graydon LLP acted as legal counsel to Hyperion Capital Inc. 

About IM Cannabis Corp. 

IMC is an MCO in the medical and adult-use recreational cannabis sector, headquartered in Israel  and with operations In Israel, Germany and Canada. Over the past decade, the Company believes  that the IMC brand has become synonymous with quality and consistency in the Israeli medical  cannabis market. The Company has also expanded its business to offer intellectual property related services to the medical cannabis industry. 

In Europe, IMC operates through Adjupharm GmbH (“Adjupharm”), a German-based subsidiary  and EU GMP-certified medical cannabis processor and distributor. IMC’s European presence is  augmented by strategic alliances with various pan-European EU-GMP cultivators and distributors  to capitalize on the increased demand for medical cannabis products in Europe and bring the IMC  brand and its product portfolio to European patients.

In Canada, IMC operates through Trichome JWC Acquisition Corp. (“TJAC”), Highland Grow and  SublimeCulture. TJAC is a licensed producer located in Kitchener, Ontario, selling cannabis flower,  pre-rolls, hash and kief in the Canadian recreational cannabis market under the WAGNERS brand.  TJAC operates with high standards for providing clean, consistent, aeroponically-grown premium  cannabis products to medical patients and the adult-use market throughout Canada and the world. Highland Grow, is a renowned brand in the Canadian super-premium cannabis space and is sold  in most provinces throughout Canada.  

About MYM Nutraceuticals Inc. 

MYM is a Canadian cultivator, processor, and distributor of premium cannabis via its two wholly owned subsidiaries – SublimeCulture Inc., in Laval, QC and Highland Grow Inc., in Antigonish, NS. 

Disclaimer for Forward-Looking Statements 

This press release contains “forward-looking information” and “forward-looking statements” within  the meaning of applicable Canadian and United States securities laws (collectively, “forward looking information”). Forward-looking information are often, but not always, identified by the use  of words such as “seek”, “anticipate”, “believe”, “plan”, “estimate”, “expect”, “likely” and “intend”  and statements that an event or result “may”, “will”, “should”, “could” or “might” occur or be  achieved and other similar expressions. Forward-looking information in this press release includes,  without limitation, statements about the Lock-Up Agreements, the delisting of the MYM Shares and  MYM’s reporting issuer status, and the operation and development of IMC’s business. 

Forward-looking information is based on assumptions that may prove to be incorrect, including but  not limited to the ability of the Company to execute its business plan, the continued growth of the  medical and/or recreational cannabis markets in the countries in which the Company operates or  intends to operate, the Company maintaining “de facto” control over Focus Medical Herbs Ltd.  (“Focus Medical”) in accordance with IFRS 10, Focus Medical maintaining its existing Israeli  medical cannabis propagation and cultivation licenses and the expected decriminalization and/or  legalization of adult-use recreational cannabis in Israel. The Company considers these  assumptions to be reasonable in the circumstances. However, forward-looking information is  subject to business and economic risks and uncertainties and other factors that could cause actual  results of operations to differ materially from those expressed or implied in the forward-looking  information. Such risks include, without limitation: a resurgence in cases of COVID-19, which has  occurred in certain locations and the possibility of which in other locations remains high and creates  ongoing uncertainty that could result in restrictions to contain the virus being re-imposed or imposed  on a more strict basis, including restrictions on movement and businesses; the Israeli government  deciding to delay or abandon the decriminalization and/or legalization of adult-use recreational cannabis; any bill relating to the decriminalization and/or legalization of adult-use recreational  cannabis in Israel being rejected by Israeli parliament; any change in the political environment  which would negatively affect the decriminalization and/or legalization of adult-use recreational  cannabis in Israel; engaging in activities considered illegal under United States federal law; the  ability of the Company to comply with applicable government regulations in a highly regulated  industry; unexpected changes in governmental policies and regulations affecting the production,  distribution, manufacture or use of medical cannabis in Israel, Germany, or any other foreign  jurisdictions in which the Company intends to operate; unexpected changes in governmental  policies and regulations affecting the production, distribution, manufacture or use of adult-use  recreational cannabis in Canada; any failure of the Company to maintain “de facto” control over  Focus Medical in accordance with IFRS 10; the Company and Focus Medical having to rely on third  party cannabis producers to supply Adjupharm and Focus Medical with product to successfully  fulfill previously announced sales agreements and purchase commitments; the ability of Focus  Medical and Adjupharm to deliver on their sales commitments; the risk that regulatory authorities  in Israel may view the Company as the deemed owner of more than 5% of Focus Medical in  contravention to Israeli rules restricting the ownership of Israeli cannabis cultivators and thereby  jeopardizing Focus Medical’s cannabis propagation or cultivation licenses; any unexpected failure  of Focus Medical to renew its propagation or cultivation licenses with the Israeli Ministry of Health;  any unexpected failure of Focus Medical to maintain any of its commercial facilities or land lease  agreements; any unexpected failure of Adjupharm to renew its production, wholesale, narcotics  handling or import/export licenses, permits, certificates or approvals; the Company’s reliance on  management; the lack of merger and acquisition opportunities; inconsistent public opinion and  perception regarding the use of cannabis; perceived effects of medical cannabis products; the  Company’s ability to maintain or improve the brand position of the IMC brand in Israel’s medical  cannabis market; political instability and conflict in the Middle East; adverse market conditions; the  inherent uncertainty of production and cost estimates and the potential for unexpected costs and  expenses; costs of inputs; crop failures; litigation; currency fluctuations; competition; industry  consolidation; and the failure to meet NASDAQ’’s continued listing requirements. Readers are  cautioned to consider these and other factors, uncertainties and potential events carefully and not  to put undue reliance on forward-looking information. The forward-looking information contained  herein is made as of the date of this press release and is based on the beliefs, estimates,  expectations and opinions of management on the date such forward-looking information is made.  The Company undertakes no obligation to update or revise any forward-looking information,  whether as a result of new information, estimates or opinions, future events or results or otherwise  or to explain any material difference between subsequent actual events and such forward-looking  information, except as required by applicable law.

For more information:

Oren Shuster
CEO, IM Cannabis
+972-77-3603504
[email protected] 

Caitlin Kasunich
Media Relations – U.S. +1 212-896-1241
[email protected] 

Gal Wilder
Media Relations – Canada +1 416-602-4092
[email protected] 

Elizabeth Barker
Investor Relations
+1 212-896-1203
[email protected]