Mr. Oren Shuster reports

IM CANNABIS RELEASES A MESSAGE FROM THE CEO ABOUT THE ISRAEL-HAMAS WAR AND ANNOUNCES SECURING C$1,390,000 IN SHORT-TERM DEBT

IM Cannabis Corp. has released a message from its chief executive officer about the Israel-Hamas war. Through its wholly owned subsidiaries, IMC Holdings Ltd. (IMC HoldCo) and Rosen High Way Ltd., IM Cannabis has secured $1.39-million in short-term debt.

"There are no words to describe the scale of the horrors that are starting to come to light. Israel is a small country, every single one of us is directly impacted, either personally or through our family and loved ones. IMC supports and stands with all the Israelis that are affected by this war. We also fully support the Israeli Defense Forces," said Oren Shuster, chief executive officer of IM Cannabis. "In Israel, Cannabis is defined as a critical infrastructure sector, just like any other pharmaceutical business. I am very proud of how the team is coming together to work through this horrific situation."

IM Cannabis, through IMC HoldCo, entered into a series of short-term loans on Oct. 3, Oct. 10 and Oct. 11, respectively, for aggregate gross proceeds of 4,082,000 Israeli shekels (approximately $1.39-million) from certain lenders, including a director and officer of the company.

Four of the loans, totalling aggregate gross proceeds of 3,082,000 Israeli shekels (approximately $1.05-million), bear interest at an annual rate of 18 per cent and mature six months from the date of issuance, along with the associated fees and commissions of 4 per cent per annum for application fee, and an origination fee of 4 per cent per annum on each loan.

IM Cannabis, through Rosen High Way, entered into the final loan, totalling aggregate gross proceeds of one million Israeli shekels (approximately $340,000), bears interest at an annual rate of 20 per cent, matures six months from the date of issuance, and is secured against certain assets of the company and its subsidiaries.

The company plans to use the proceeds from the loans for general working capital purposes.

Out of the aggregate gross proceeds of 4,082,000 Israeli shekels (approximately $1.39-million), Mr. Shuster, a director and officer of the company, loaned an amount of 500,000 Israeli shekels (approximately $170,000) to IMC HoldCo. The participation of the participating insider in the loan constitutes a related-party transaction, as such term is defined in Multilateral Instrument 61-101 -- Protection of Minority Shareholders in Special Transactions (MI 61-101) and would require the company to receive minority shareholder approval for, and obtain a formal valuation for the subject matter of, the transaction in accordance with MI 61-101, prior to the completion of such transaction. However, in completing the loan, the company has relied on exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101, in each case on the basis that the fair market value of the participating insider's loan does not exceed 25 per cent of the market capitalization of the company, as determined in accordance with MI 61-101. Further details will be included in a material change report to be filed by the company. The company did not file a material change report in respect of the loan transaction more than 21 days before entering into the loan as the shorter period was necessary to permit the company to close the loan in a time frame consistent with usual market practice for a transaction of this nature.

About IM Cannabis Corp.

IM Cannabis is an international cannabis company that provides premium cannabis products to medical patients in Israel and Germany, two of the largest medical cannabis markets. The company has recently exited operations in Canada to pivot its focus and resources to achieve sustainable and profitable growth in its highest-value markets, Israel and Germany. The company leverages a transnational ecosystem powered by a unique data-driven approach and a globally sourced product supply chain. With an unwavering commitment to responsible growth and compliance with the strictest regulatory environments, the company strives to amplify its commercial and brand power to become a global high-quality cannabis player.

The IM Cannabis ecosystem operates in Israel through its commercial relationship with Focus Medical Herbs Ltd., which imports and distributes cannabis to medical patients, leveraging years of proprietary data and patient insights. The company also operates medical cannabis retail pharmacies, on-line platforms, distribution centres and logistical hubs in Israel that enable the safe delivery and quality control of IM Cannabis products throughout the entire value chain. In Germany, the IM Cannabis ecosystem operates through Adjupharm GmbH, where it distributes cannabis to pharmacies for medical cannabis patients. Until recently, the company also actively operated in Canada through Trichome Financial Corp. and its wholly owned subsidiaries, where it cultivated, processed, packaged and sold premium and ultrapremium cannabis at its own facilities under the Wagners and Highland Grow brands for the adult-use market in Canada. The company has exited operations in Canada and considers these operations discontinued.

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