The company intends to use the proceeds to help pay back a loan it has with a local Israeli car and electronics importer.
IM Cannabis Corp. (NASDAQ: IMCC) (CSE: IMCC) announced plans for a private placement offering of up to $1.6 million led by CEO Oren Shuster and director Shmulik Arbel.
The Israeli-based medical cannabis company intends to issue up to 625,000 units, each comprising one share and one warrant, according to a news release.
The offering price will be based on recent trading averages, with closure expected by November 11.
“The company intends to use the proceeds from the offering for the repayment of a loan to A.D.I. CAR ALARMS & STEREO SYSTEMS Ltd. provided to the company’s subsidiary IMC Holdings Ltd. on October 11, 2022,” the release stated.
The company didn’t specify exactly how much it owed ADI from the 2022 loan.
Simultaneously, the company plans to settle $560,000 with Shuster for loan guarantees he provided on over $8 million in loans the company has borrowed since October 2022.
The company also announced the cancellation of over 175,000 options and warrants, citing unrealistic exercise prices. New options will be granted to replace those cancelled.
IM Cannabis, which recently exited the Canadian market to focus on its Israeli and German markets, noted the transactions are expected to be exempt from certain regulatory requirements.
The company has been making steady progress in Germany, where its subsidiary, Adjupharm GmbH (IMC Germany), distributes cannabis to pharmacies for medical cannabis patients. The company has already said the country provides more than a quarter of its total sales.
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