UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 20-F

 

 

 

 

 

 

 

 

Commission file number: 001-40065

 

IM Cannabis Corp.
(Exact name of Registrant as specified in its charter)

 

British Columbia, Canada
(Jurisdiction of incorporation or organization)

 

3606 – 833 Seymour Street, Vancouver, British Columbia V6B 0G4
(Address of principal executive offices)

 

Oren Shuster, +972-544-331-111, oren@imcannabis.com
3606 – 833 Seymour Street, Vancouver, British Columbia V6B 0G4
(Name, Telephone, E-Mail and/or Facsimile number and Address of Company Contact Person)

 

Securities registered or to be registered pursuant to Section 12(b) of the Act:

 

 

Securities registered or to be registered pursuant to Section 12(g) of the Act: N/A

 

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

 

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 5,894,812 Common Shares

 

 

Indicate by check mark if the Company is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

 

If this report is an annual or transition report, indicate by check mark if the Company is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

 

Indicate by check mark whether the Company (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the Company was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

 

Indicate by check mark whether the Company has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Company was required to submit and post such files).

 

 

Indicate by check mark whether the Company is a large accelerated filer, an accelerated filer, a non-accelerated filer or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

 

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

 

Indicate by check mark which basis of accounting the Company has used to prepare the financial statements included in this filing:

 

 

If “Other” has been checked in response to previous question, indicate by check mark which financial statement item the Company has elected to follow.

 

Item 17 ☐        Item 18 ☐

 

If this is an annual report, indicate by check mark whether the Company is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

Legal Entity	Jurisdiction	Relationship with the Company
I.M.C. Holdings Ltd. (“IMC Holdings”)	Israel	Wholly-owned subsidiary
I.M.C. Pharma Ltd. (“IMC Pharma”)	Israel	Wholly-owned subsidiary of IMC Holdings
Focus Medical Herbs Ltd. (“Focus")(1)	Israel	Wholly-owned subsidiary of IMC Holdings
R.A. Yarok Pharm Ltd. (“Pharm Yarok”)	Israel	Wholly-owned subsidiary of IMC Holdings
Rosen High Way Ltd. (“Rosen High Way”)	Israel	Wholly-owned subsidiary of IMC Holdings
Rivoly Trading and Marketing Ltd. d/b/a Vironna Pharm (“Vironna”)	Israel	Subsidiary of IMC Holdings
Adjupharm GmbH (“Adjupharm”)	Germany	Subsidiary of IMC Holdings
Trichome Financial Corp. (“Trichome") (2)	Canada	Former wholly-owned subsidiary
Xinteza API Ltd (“Xinteza”)	Israel	Subsidiary of IMC Holdings
Shiran Societe Anonyme (“Greece”)	Greece	Subsidiary of IMC Holdings
IM Cannabis Holding NL B.V Netherlands (“IMC Holdings NL”)	Netherlands	Wholly-owned subsidiary of IMC Holdings

(1)

Effective February 26, 2024, IMC Holdings exercised its option to acquire a 74% ownership stake in Focus, and effective May 26, 2025, IMC Holdings acquired the remaining 26% from Ewave Group Ltd.

(2)

Discontinued operations.

•

our business objectives and milestones and the anticipated timing of execution;

•

the performance of our business, strategies and operations;

•

our intentions to expand our business, operations, sales channels, distribution, delivery and storage capacity;

•

our ability to reach to medical cannabis patients and address their ongoing needs and preferences;

•

the competitive conditions of the cannabis industry and the growth of medical or adult-use recreational cannabis markets in the jurisdictions in which we operate;

•

our ability to maintain or grow our market share and maintain our competitive advantages;

•

our focus on providing premium cannabis products and strengthening our brands and commercial position;

•

demand trends and momentum in our Israeli and Germany operations;

•

the benefits of our retail presence, distribution capabilities, data-driven insights and third-party partnerships;

•

expectations regarding recurring sales and operating efficiencies;

•

anticipated cost savings from our reorganization and the timing thereof;

•

the impact of the Regulations Amendment (as defined herein) and other regulatory developments;

•

our ability to achieve profitability, improve margins and manage liquidity;

•

the number of patients in Israel licensed by the Israeli Ministry of Health (“MOH”) to consume medical cannabis and the number of patients paying out-of-pocket for medical cannabis products in Germany;

•

the anticipated decriminalization or legalization of adult-use recreational cannabis in Israel and Germany;

•

our operating budget and the assumptions underlying it;

•

our ability to continue as a going concern;

•

the outcome of legal proceedings;

•

the continued listing of our Common Shares on the Nasdaq Stock Market LLC (“Nasdaq”);

•

our ability to maintain, renew and extend cannabis licenses;

•

our anticipated operating cash requirements and future financing needs;

•

our expectations regarding revenue, expenses, profit margins and operations; and

•

our entry into, and development of, new lines of business;

•

future opportunities for growth in Israel, Germany and Europe.

•

We have incurred significant losses since our inception and anticipate that we will incur continued losses;

•

We have generated insufficient revenues from product sales and may never be profitable;

•

If our operational cash flows continue to be negative, we may be required to fund future operations with alternative financing options such as offerings of shares;

•

We may not be able to secure the funds necessary to implement our strategies;

•

In pursuit of new opportunities in the cannabis industry, we may fail to select appropriate investment candidates and negotiate acceptable arrangements;

•

Unfavorable divestments could have a material adverse effect on us; and

•

Regulatory authorities in Israel may determine that we are in contravention of Israeli cannabis regulations;

•

Our operations are subject to various laws, regulations and guidelines, and any potential noncompliance could cause our business, financial condition and results of operations to be adversely affected;

•

Our operations are subject to a variety of laws, regulations, and guidelines, to which any changes could have a material adverse effect on our business, results of operations, financial condition and prospects;

•

Failure to meet target production capacity may result in a material adverse effect on our business, financial condition; and

•

Our ability to produce, store, import, distribute and sell cannabis and derivative products is dependent on licensing and any failure to maintain such licenses would have a material adverse impact;

•

Increased competition could materially and adversely affect our business, financial condition and results of operations;

•

We are vulnerable due to the results of the “Anti-Dumping” investigation into cannabis imports from Canada that could have a material adverse effect on our business;

•

We rely on business licenses, permits and approvals and the failure to maintain those could have a material adverse effect on our business, financial condition and results of the operations;

•

We rely on key business inputs and any failure to secure required supplies and services or to do so on appropriate terms could also have a material adverse effect on our business, financial condition, and operating results;

•

We rely upon the ability, judgment, discretion and good faith of key personnel, and the inability to attract, develop, motivate and retain highly qualified employees could have a material adverse effect on our business, financial condition and results of operations;

•

The failure to design, develop or maintain effective internal controls may affect our ability to prevent fraud, detect material misstatements, and fulfill reporting obligations.

•

The insurance purchased by the us cannot cover all risks that we are exposed to, and any uninsured amounts of liabilities incurred by our member(s) may be paid directly by such members; and

•

Our principal shareholders, officers and directors beneficially own approximately 23.4% of our Common Shares, and therefore be able to exert significant control over matters submitted to shareholders’ approval; We may issue additional securities in the future, which may dilute our shareholder’s holdings.

•

The possible lack of liquidity of securities may cause difficulty for security holders to re-sell securities at desired prices;

•

Loss of foreign private issuer status under United States securities laws could increase our regulatory and compliance costs; and

•

We may be a “passive foreign investment company” (“PFIC”), for U.S. federal income tax purposes in the current taxable year or become a PFIC in the future. There generally would be negative tax consequences for U.S. taxpayers that are holders of the Common Shares if we are a PFIC.

•

We use intellectual property protections to protect our products, brands and technologies. Maintaining such protections and paying any costs attributed to the enforcement of such protections does not completely eliminate the risk of litigation, which may result in a material adverse effect on our business, financial condition, results of operations and prospects.

•

We are vulnerable to the political, economic, legal, social, regulatory, and military conditions affecting Israel and the Middle East that could have a material adverse effect on our business, results of operations, financial condition and our prospects.

•

It may be difficult to enforce a U.S. judgment against us, our officers and directors in Israel or the United States, or to assert U.S. securities laws claims in Israel or serve process on our officers and directors; and

•

Since we are incorporated in British Columbia and substantially all of our directors and officers reside outside the United Stated, and some outside Canada, it may be difficult in the United States to enforce civil liabilities against us based solely upon the federal securities laws of the United States. Similarly, it may be difficult to enforce civil liabilities against our directors and officers residing outside of Canada.

•

are subject to receipt of applicable regulatory approvals and changes in applicable regulations and laws;

•

continue operations in Israel, which is vulnerable to security and military conditions due to heightened tension in the Middle East. For more information, see “Risks Related to Israeli Law and Our Operations in Israel” – “We are vulnerable to the political, economic, legal, social, regulatory, and military conditions affecting Israel and the Middle East that could have a material adverse effect on our business, results of operations, financial condition and our prospects” in this “Risk Factors” Section.

•

Continue the research and development of our products;

•

Seek regulatory and marketing approval for our products;

•

Seek to attract and retain skilled personal;

•

Create additional infrastructure to support our operations as a public company and our planned future commercialization efforts;

•

Experience any delays or encounter issues with respect to the above.

•

finance our operations and the import of cannabis to Israel and  Germany;

•

establish and maintain supply and, if applicable, manufacturing relationships with third parties that can provide, in both amount and quality, adequate products to support development and the market demand for our products, and any future products;

•

any delays and disruptions we encounter in our supply chains;

•

the stability of the operations of our suppliers and service providers, and our relationship with them;

•

maintain sufficient average selling price for our products and the revenues margin we generate;

•

enter into agreements with commercial partners;

•

obtain market acceptance to our products and any future products;

•

accurately identifying demand for our products and any future products;

•

launch and commercialize any products for which we obtain regulatory and marketing approval;

•

address any competing technological and market developments that impact our products and their usage;

•

negotiate favorable terms in any collaboration, licensing or other arrangements into which we may ener and perform our obligations under such collaborations;

•

divest our cannabis operations and retain our existing pharmacy business in Israel;

•

diversifying into a new business line, unrelated to the legacy cannabis business or the existing pharmacy business in Israel;

•

attract, hire and retain qualified personnel; and

•

any changes in applicable regulations and laws;

---

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●

diversion of management time and focus from operating our business to addressing acquisition integration challenges;

●

coordination of research and development and sales and marketing functions;

●

retention of employees from the acquired company;

●

cultural challenges associated with integrating employees from the acquired company into our organization;

●

integration of the acquired company's accounting, management information, human resources, and other administrative systems;

●

the need to implement or improve controls, procedures, and policies at a business that prior to the acquisition may have lacked effective controls, procedures, and policies;

●

potential write-offs of intangible assets or other assets acquired in transactions that may have an adverse effect on our operating results in a given period;

●

liability for activities of the acquired company before the acquisition, including patent and trademark infringement claims, violations of laws, commercial disputes, tax liabilities, and other known and unknown liabilities; and

●

litigation or other claims in connection with the acquired company, including claims from terminated employees, consumers, former stockholders, or other third parties.

•

engagement of a new third-party processing facility.

•

changes to shipping and distribution service providers.

-

The Craft Collection – IMC brand’s premium product line with indoor-grown, hand-dried and hand-trimmed high-THC cannabis flowers. The Craft Collection includes exotic and unique cannabis strains such as Sup.S.

-

The Top-Shelf Collection – IMC’s premium product line which offers indoor-grown, high-THC cannabis flowers with strains such as Lemon Rocket, Diesel Drift, Tropicana Gold, Lucy Dreamz, Santa Cruz, Or’enoz, and Banjo. Inspired by the 1970's cannabis culture in America, the Top-Shelf Collection targets the growing segment of medical patients who are cannabis culture enthusiasts.

-

The Signature Collection – IMC brand’s high-quality product line with greenhouse-grown or indoor grown, high-THC cannabis flowers. The Signature Collection currently includes well known proprietary cannabis dried flowers such as Chemchew, Rockabye, FLO OG, Roma T15, Roma T20, Karma lada, Sydney, MOTORBRTH and B.F LMO, which are all indoor-grown flowers.

-

The Full Spectrum Extracts – IMC brand’s full spectrum, strain-specific cannabis extracts, which includes high-THC Roma®T20 oil and OIL GLTO 33.

-

Roma® Product Portfolio – IMC's Roma® portfolio also includes oils. IMC’s Roma® strain is a high-THC medical cannabis flower that offers a therapeutic continuum and is known for its strength and longevity of effect.

-

BLKMKT™ – this brand is our second Canadian brand. It is a super-premium product line with indoor-grown, hand-dried and hand-trimmed high-THC cannabis flowers. The BLKMKT™ includes BLK MLK, YA HEMI, PURPLE RAIN, JEALOUSY, Hemi GLTO, RAINBOW P, GUVA BOBA, Sunsets.rudel, Park fire OG and Up side down C.

-

LOT420 – this brand launched in Israel in the second quarter of 2023, with super-premium indoor-grown cannabis with high-THC imported from Canada. The LOT420 brand includes GLTO 33, Apps and Bans and O.C. We ceased selling Atomic APP.

-

The PICO collection (minis) - Under the BLKMKT™ and LOT420 brands, we launched in 2023 a new type of product (small flowers), which is a super-premium indoor-grown cannabis imported from Canada with high-THC. The PICO collection includes the following products: PICO PURPLE RAIN, PICO YA HEMI, PICO JEALOUSY, Pico upside Down, PICO RAIN BOW, Pico California love, PICO BLK MLK and PICO Bacio Glto.

-

Flower – In the second quarter of 2024, we launched a super-premium indoor-grown cannabis with high-THC imported from Canada. The Flower brand includes cannabis strains called California Love and Face Sherb.

Revenues from Continuing Operations - By Product Type (in thousands of Canadian dollars)
Financial Year	Medical Cannabis Products	Other Products	Total
2025	$53,186	$1,545	$54,731
2024	$51,355	$2,696	$54,031
2023	$44,246	$4,558	$48,804

Revenues from Continuing Operations - By Geographic Market (in thousands of Canadian dollars)
Financial Year	Israel	Germany	Total
2025	$18,383	$36,348	$54,731
2024	$38,523	$15,508	$54,031
2023	$43,316	$5,488	$48,804

2.

Medical cannabis will now be prescribed through the HMO's, Israel's public healthcare system: until the April 2024 Regulatory Reform, cannabis could not be prescribed through the HMO's which cover the majority of the Israeli population.

3.

The number of prescribing physicians is expected to increase: as of today, HMO physicians, who are dully trained and certified within their field of expertise, can prescribe medical cannabis as a first line treatment, as opposed to a last resort, based on medical discretion for the approved indications.

4.

The cost for prescription is anticipated to be reduced: the Ministry of Health limited the cost for a medical cannabis prescription.

---

Name	Position(s) with us	Age	Other Directorships	Date of Initial Appointment
Oren Shuster(4)	Chief Executive Officer and Director	57	IMC Holdings; Focus; Pharm Yarok; Rosen High Way; IMC Pharma; IMC Farms; Ewave Group Ltd (“Ewave”) and its subsidiaries;	October 11, 2019
Asi Levi	Chief Financial Officer	46	-	December 11, 2025
Oz Adler	Chairman of the Board	39	Elbit Imaging Ltd; Clearmind Inc; Rail Vision Ltd; Jeffs’ Brands Ltd; and Polyrizon Ltd.	July 7 ,2025
Alon Dayan	Director	50	SciSparc Ltd; and ViewBix Inc.	December 31, 2025
Assaf Yitzhaik(1)	Director	53	Rani Zim Shopping Centers Ltd; Gix Internet Ltd; Clearmind Medicine Inc; Save Foods Inc; Jeffs’ Brands Ltd; Plyrizon Ltd; and Plentify Ltd;	September 15, 2025
Einat Zakariya(1)(2)(3)	Director	55	-	September 1, 2022
Eli Zamir(1)(2)	Director	56	Newmed Energy	September 15, 2025
Moti Marcus(1)(2)(3)	Director	63	-	September 12, 2022
Richard Balla	Chief Executive Officer of Adjupharm, a wholly owned subsidiary of the Company	40	-	March 21, 2019

(1)	Member of the Audit Committee.

(2)	Member of the Compensation Committee

(3)	Member of the Governance and Nomination Committee.

(1)

Oren Shuster, CEO, Executive Chairman and a director;

(2)

Asi Levi, CFO;

(3)

Oz Adler, Chairman of the Board;

(4)

Richard Balla, Chief Executive Officer of Adjupharm, a wholly owned subsidiary of the Company;

(5)

Michal Lebovitz Nissimov, former General Counsel and Secretary;

(6)

Uri Birenberg, former CFO.

1.

base salary;

2.

cash bonuses; and/or

3.

long-term incentives.

1.	Base Salary

2.	Cash Bonuses

3.	Long Term Incentives

	December 31, 2020	December 31, 2021	December 31, 2022	December 31, 2023	December 31, 2024	December 31, 2025
IM Cannabis Corp.	$100.00	$42.03	$1.29	$0.46	$0.54	$0.23
CSE Composite Index	$100.00	$171.57	$132.1	$41.3	$33.71	$35.07

1.

Einat Zakariya (Chair);

2.

Eli Zamir; and

3.

Moti Marcus,

•	Salary Benchmarking for Management Positions – Conducting a comparative analysis of executive salary levels based on a tailored sample of companies. This includes the CEO and senior management positions, with a breakdown of base salary, bonuses, and equity compensation.

•	Compensation Analysis for International Operations – Assessing salary levels for executives in Adjupharm, using MERCER and Accumulate market data. This includes benchmarking compensation components such as base salary, bonuses, and equity grants.

•	Equity Grant Policy Review – Evaluating our equity compensation strategy for Board members and executives, including grant methods, frequency, and valuation.

•	Equity Compensation Policy Development – Establishing an equity-based compensation framework, including:

o

Defining a capital compensation strategy.

o

Structuring an allocation model for existing and new employees, from the CEO and Board members downward.

o

Setting guidelines for equity content and reallocation policies.

o

Developing a multi-year allocation plan; and

o

Supporting Compensation Committee approval processes.

Name and Principal Position	Year	Salary ($)(1)	Share- Based Awards ($)	Option-Based Awards ($)(2)	Non-Equity Incentive Plan Compensation ($)		Pension Value ($)	All Other Compensation ($)(3)	Total Compensation ($)
					Annual Incentive Plans	Long-Term Incentive Plans
Oren Shuster(4) CEO, Executive Chairman and Director	2025	526,397	Nil	Nil	Nil	Nil	Nil	Nil	526,397
	2024	484,697	Nil	45,591	Nil	Nil	Nil	Nil	530,288
	2023	476,266	Nil	331,802	Nil	Nil	Nil	Nil	818,068
Asi Levi(5) CFO	2025	12,455	Nil	Nil	Nil	Nil	Nil	Nil	12,455
Uri Birenberg(6) Former CFO	2025	384,701	Nil	Nil	Nil	Nil	Nil	Nil	384,701
	2024	330,238	Nil	Nil	Nil	Nil	Nil	26,064	356,302
	2023	73,558	Nil	Nil	Nil	Nil	Nil	Nil	73,558
Richard Balla Chief Executive Officer of Adjupharm	2025	192,000	Nil	Nil	96,000	Nil	Nil	29,133	317,133
	2024	193,608	Nil	Nil	88,908	Nil	Nil	31,035	313,551
	2023	175,385	Nil	Nil	87,692	Nil	Nil	30,895	293,972
Michal Lebovitz Nissimov Former General Counsel and Secretary(7)	2025	242,509	Nil	Nil	Nil	Nil	Nil	Nil	242,509
	2024	192,877	Nil	828	Nil	Nil	Nil	Nil	193,705
	2023	119,088	Nil	1,099	Nil	Nil	Nil	Nil	120,187
Marc Lustig, former Executive Chairman(8)	2024	22,400	Nil	Nil	Nil	Nil	Nil	Nil	22,400
	2023	129,920	79,959	Nil	Nil	Nil	Nil	Nil	209,879
Oz Adler, Executive Chairman(9)	2025	36,293	Nil	Nil	Nil	Nil	Nil	Nil	36,293

	Option-based Awards
Name	Number of securities underlying unexercised Options (#)(1)	Option exercise price ($)	Option expiration date	Value of unexercised in-the-money Options ($)(2)
Oren Shuster	21,875	3.00	October 4, 2026	Nil
Asi Levi	Nil	Nil	Nil	Nil
Uri Birenberg (Former CFO)	Nil	Nil	Nil	Nil
Oz Adler	Nil	Nil	Nil	Nil
Richard Balla	625	96.00	July 30, 2029	Nil
Michal Lebovitz Nissimov (Former General Counsel and Secretary)	500	3.00	October 4, 2026	Nil

(1)	Each Option entitles the holder to purchase one Common Share.

(2)	As of December 31, 2025, the  closing price of the Common Shares, was US$1.39 per Common Share.

Name	Option-based awards – Value vested during the year ($)(1)	Share-based awards – Value vested during the year ($)	Non-equity incentive plan compensation – Value earned during the year ($)
Oren Shuster	69	Nil	Nil
Asi Levi	Nil	Nil	Nil
Uri Birenberg	Nil	Nil	Nil
Oz Adler	Nil	Nil	Nil
Richard Balla	Nil	Nil	Nil
Michal Lebovitz Nissimov	2	Nil	Nil

Name(1)	Fees earned ($)(2)	Share-based awards ($)	Option-based awards ($)(3)	Non-equity incentive plan compensation ($)	Pension value ($)	All other compensation ($)	Total ($)
Oz Adler(4)	36,293	Nil	Nil	Nil	Nil	Nil	36,293
Brian Schinderle(5)	54,799	Nil	Nil	Nil	Nil	Nil	54,799
Moti Marcus(6)	80,635	Nil	Nil	Nil	Nil	Nil	80,635
Einat Zakariya(8)	76,054	Nil	Nil	Nil	Nil	Nil	76,054
Shmulik Arbel	44,373	Nil	Nil	Nil	Nil	Nil	44,373
Alon Dayan(8)	Nil	Nil	Nil	Nil	Nil	Nil	Nil
Eli Zamir(9)	24,150	Nil	Nil	Nil	Nil	Nil	24,150
Assaf Yitzhaik(10)	24,150	Nil	Nil	Nil	Nil	Nil	24,150

(1)	Each of Mr. Marcus Ms. Zakariya and Mr. Arbel received their compensation in NIS and Mr. Schinderle received his compensation in USD. All salaries were converted to CAD pursuant to the average Bank of Canada rate for the applicable fiscal year. L5 Capital received their fees in CAD.

(2)

Other than with respect to Mr. Lustig, each director was entitled to a $13,750 payment per quarter for their role as a director . For each Audit Committee meeting, the Chair received a $1,500 payment and each other member received a $1,000 payment and for each of the Compensation Committee and Governance and Nomination Committee meetings, the Chair received a $1,200 payment and each other member received a $700 payment.

(3)

We used the Black-Scholes pricing model as the methodology to calculate the grant date fair value and relied on the following key assumptions and estimates for each calculation under the following assumptions: (i) risk free interest rate of 3.23% (ii) expected dividend yield of 0%; (iii) expected volatility of 128.1% to 137.34%; and (iv) a term of 2 years. The Black-Scholes pricing model was used to estimate the fair value as it is the most accepted methodology.

(4)	Mr. Adler was appointed as director and Chairman of the Board on September 15, 2025.

(5)	Mr. Schinderle resigned from the Board effective September 15, 2025. As a director, Mr. Schinderle received compensation through Solidum Capital Advisors LLC.

(6)	Mr. Marcus receives compensation through Marcus Management Services Ltd.

(7)	Mr. Arbel resigned from the Board effective September 15, 2025. As a director, Mr. Arbel received additional compensation for his services as an adviser to us. This compensation was received in NIS and converted to CAD pursuant to the average Bank of Canada rate for the applicable fiscal year.

(8)	Mr. Dayan was appointed as director on December 31, 2025.

(9)	Mr. Zamir was appointed as director on September 15, 2025.

(10)	Mr. Yitzhaik was appointed as director on September 15, 2025.

	Option-based Awards				Share-based Awards
Name	Number of securities underlying unexercised Options (1) (#)	Option exercise price ($)	Option expiration date	Value  of unexercised in-the-money Options(2) ($)	Number of shares or units of shares that have not vested (#)	Market or payout value of share-based awards that have not vested ($)	Market or payout value of vested share- based awards not paid out or distributed ($)
Oz Adler	Nil	N/A	N/A	Nil	Nil	N/A	N/A
Brian Schinderle	1,500	3.00	October 4, 2026	Nil	Nil	Nil	Nil
Moti Marcus	1,500	3.00	October 4, 2026	Nil	Nil	Nil	Nil
Einat Zakariya	1,500	3.00	October 4, 2026	Nil	Nil	Nil	Nil
Shmulik Arbel	Nil	N/A	N/A	Nil	Nil	N/A	N/A
Marc Lustig	Nil	N/A	N/A	Nil	Nil	N/A	N/A
Alon Dayan	Nil	N/A	N/A	Nil	Nil	N/A	N/A
Assaf Yitzhaik	Nil	N/A	N/A	Nil	Nil	N/A	N/A
Eli Zamir	Nil	N/A	N/A	Nil	Nil	N/A	N/A

(1)	Each Option entitles the holder to purchase one Common Share.

Name	Option-based awards – Value vested during the year(1) ($)	Share-based awards – Value vested during the year ($)	Non-equity incentive plan compensation – Value earned during the year ($)
Brian Schinderle	62	Nil	Nil
Moti Marcus	62	Nil	Nil
Einat Zakariya	62	Nil	Nil
Assaf Yitzahik	NA	NA	NA
Eli Zamir	NA	NA	NA

Name of Director	Board	Audit Committee	Compensation Committee	Special Committee
Oz Adler	8/19	1/7	NA	N/A
Oren Shuster	19/19	1/7	NA	N/A
Moti Marcus	19/19	7/7	NA	1/1
Einat Zakariya	18/19	6/7	2/2	N/A
Brian Schinderle(2)	13/19	5/7	NA	N/A
Shmulik Arbel(3)	12/19	1/7	NA	N/A
Alon Dayan(4)	NA	NA	NA	N/A
Assaf Yitzahik(5)	6/19	2/7	2/2	1/1
Eli Zamir(6)	6/19	2/7	2/2	1/1

(1)	Marc Lustig resigned as Executive Chairman and a director effective June 5, 2024.

(2)	Brian Schinderle resigned as a director effective September 15, 2025.

(3)	Shmulik Arbel resigned as a director effective September 15, 2025.

(4)	Alon Dayan was appointed as director effective December 31, 2025.

(5)	Assaf Yitzhaik was appointed as director effective September 15, 2025.

(6)	Eli Zamir was appointed as director effective September 15, 2025.

(a)

overseeing that our day-to-day business affairs are appropriately managed and taking steps to maintain and enhance an effective senior management team reporting to the CEO;

(b)

recommending to the Board our financial and operating goals and objectives and, following approval by the Board thereof, consistently striving to achieve such goals and objectives;

(c)

formulating, and presenting to the Board for approval, long-term business plans, strategies and policies having the objective of maximizing our long-term success and the creation of shareholder value;

(d)

together with other senior management, as are appropriate, developing and recommending to the Board annual business plans and budgets that support our long term business plans and strategies;

(e)

developing and implementing, with our senior management, plans, strategies, budgets and policies necessary to achieve our goals and objectives;

(f)

supervising, maintaining and deploying our resources – human, financial or otherwise – with the purpose and objective of achieving our operating goals and objectives;

(g)

keeping the Board informed in a timely and candid manner of our progress towards the achievement of its strategic and operational goals and objectives and of all material deviations from the goals, objectives, plans, strategies, budgets or policies established by the Board;

(h)

overseeing, evaluating and taking steps to enhance, where necessary, the integrity and reliability of our internal controls, including its management information systems and financial reporting, and establishing, maintaining, designing and evaluating disclosure controls and procedures for us;

(i)

identifying and managing business risks we faced, including overseeing the design and implementation of appropriate systems and procedures to effectively monitor, manage and mitigate such risks;

(j)

ensuring that the Board has regular exposure to our senior management and overseeing the development and succession of our senior management team;

(k)

evaluating the performance of our senior management and making recommendations with respect to their compensation;

(l)

maintaining a positive and ethical work climate that is conducive to attracting, retaining and motivating a diverse group of top-quality employees at all levels;

(m)

serving as our principal spokesperson and ensuring that information communicated to the public fairly portrays our position and that timely and continuous disclosure of our obligations are met;

(n)

representing us in a such a way so as to enhance and maintain our reputation and to promote positive relationships with shareholders, suppliers, contractors, clients, service providers, strategic partners, creditors, financial institutions, local communities, all levels of government and the media; and

(o)

fulfilling all other responsibilities as assigned by the Board, in the manner expected by the Board.

Name	Independence(1)	Financial Literacy(2)
Moti Marcus (Chair)	Independent	Financially literate
Asaf Yitzhaik	Independent	Financially literate
Eli Zamir	Independent	Financially literate

1.	Within the meaning of subsection 1.4 of NI 52-110 and as determined under Exchange Act Rule 10A-3 and Rule 5605(a)(2) of the Nasdaq Stock Market Rules.

2.	Within the meaning of subsection 1.6 of NI 52-110, Item 407(d)(5)(ii)-(iii) of Regulation S-K under the Exchange Act) and Rule 5605(c)(2)(A) of the Nasdaq Stock Market Rules.

(i)

matters of governance; and

(ii)

the nomination of directors to the Board.

Name	Independence(1)
Einat Zakariya (Chair)	Independent
Oren Shuster	Non - Independent
Moti Marcus	Independent

Year		Full Time		Part Time		Total
Fiscal 2023		95		-		95
Fiscal 2024		55		-		55
Fiscal 2025		44		-		44

Year		Israel		Germany		Canada		Total
Fiscal 2023		77		18		-		95
Fiscal 2024		35		20		-		55
Fiscal 2025		21		23		-		44

•

each person, or group of affiliated persons, known by us to beneficially own five percent (5%) or more of any class of our shares;

•

each of our Named Executive Officers;

•

each of our directors; and

•

all of our directors and executive officers as a group.

Name of Beneficial Holder	Number of Common Shares Beneficially Held	Number of Common Shares Underlying Options	Option Exercise Price ($)	Option Expiration Date	Restricted Share Units	Debentures	Warrants	Total Convertible Securities	Percentage of Common Shares Beneficially Held Undiluted	Percentage of Common Shares Beneficially Held Partially Diluted
Holders of more than 5% of our voting securities:
Oren Shuster*(1)	898,350	21,875	3.00	October 4, 2026	Nil	46,512	194,111	262,498(1)	14.72%	19.02%
Rafael Gabay(2)	518,525	Nil	Nil	Nil	Nil	46,396	194,087	240,483	8.49%	12.43%
Directors and senior management who are not 5% holders:
Oz Adler*	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil
Alon Dayan*	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil
Asi Levi	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil
Assaf Yitzhaik*	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil
Einat Zakariya*	10,200	1,500	3.00	October 4, 2026	Nil	Nil	Nil	1,500	**	**
Eli Zamir*	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil	Nil
Moti Marcus*	Nil	1,500	3.00	October 4, 2026	Nil	Nil	Nil	1,500	Nil	**
Richard Balla	Nil	625	96.00	July 30, 2029	Nil	Nil	Nil	625	Nil	**
All directors and senior management as a group (8 persons):
	908,550	21,875			Nil	46,512	194,111	266,292	15.41%	19.93%

(1)	769,532 Common Shares and 194,111 Warrants are held by Oren Shuster directly and 128,818 Common Shares are held indirectly through Ewave, a privately-held entity of which Mr. Shuster owns and controls 50% of the outstanding voting rights. Mr. Shuster also holds 46,512 convertible debentures.

(2)	518,500 Common Shares and 194,087 Warrants are held by Rafael Gabay directly and 25 Common Shares are held indirectly by Ewave, a privately-held entity of which Mr. Gabay owns and controls 50% of the outstanding voting rights. Mr. Gabay also holds 46,396 convertible debentures.

•

The contractual party of the Company was not the Stroakmont & Atton. The contract with Stroakmont & Atton was only concluded as a sham transaction in order to cover up a contract with a company named Uniclaro GmbH (“Uniclaro”). Therefore, Stroakmont & Atton is not the real purchaser rather than Uniclaro.

1.

under the age of 18 years;

2.

found by a court, in Canada or elsewhere, to be incapable of managing the individual’s own affairs, unless a court, in Canada or elsewhere, subsequently finds otherwise;

3.

an undischarged bankrupt; or

4.

convicted in or out of the Province of British Columbia of an offence in connection with the promotion, formation or management of a corporation or unincorporated business, or of an offence involving fraud, unless:

a.

the court orders otherwise;

b.

5 years have elapsed since the last to occur of:

i.

the expiration of the period set for suspension of the passing of sentence without a sentence having been passed;

ii.

the imposition of a fine;

iii.

the conclusion of the term of any imprisonment; and

iv.

the conclusion of the term of any probation imposed; or

c.

a pardon was granted or issued, or a record suspension ordered, under the Criminal Records Act (Canada) and the pardon or record suspension, as the case may be, has not been revoked or ceased to have effect.

•

Focus IP Agreement and Cancellation Note:  The intellectual property agreement dated April 2, 2019, as amended on January 1, 2021, between IMC Holdings and Focus, and the related services agreement dated April 2, 2019, as amended on January 1, 2021, pursuant to which IMC Holdings derived economic benefits from Focus and Focus (i) used the IMC brand on an exclusive basis for the sale of cannabis products; and (ii) engaged IMC Holdings to provide certain management and consulting services. On February 26, 2024, the parties executed a cancellation note terminating the Focus IP Agreement as of such date.

•

Telecana Loan Agreement: On November 29, 2022, IMC Holdings entered into a convertible loan agreement (the “Telecana Loan Agreement”) with Telecana Ltd. (“Telecana”) and its sole shareholder, pursuant to which IMC Holdings loaned an aggregate of NIS 1,545 thousand (approximately C$605 thousand) in installments between January and May 2023. Pursuant to the Telecana Loan Agreement, subject to approval from the IMCA, the loan may be converted into 51% of the share capital of Telecana upon the earlier of (i) receipt of a preliminary license from the IMCA, or (ii) at the sole discretion of IMC Holdings.

•

Kadimastem Term Sheet and Loan Agreement: On February 28, 2024, we entered into a non-binding term sheet (the “Kadimastem Term Sheet”) and a loan agreement (the “Kadimastem Loan Agreement”) with Kadimastem Ltd., in connection with a proposed business combination that would have constituted a reverse merger. Under the Kadimastem Loan Agreement, Kadimastem agreed to provide a loan of up to $650 thousand to IMC Holdings, secured by certain assets and a personal guarantee by our Chief Executive Officer. On May 28, 2024, we announced the termination of the Kadimastem Term Sheet. Pursuant to a separation agreement, the outstanding loan of $300 thousand was repaid with accrued interest by July 31, 2024.

•

Oranim Pharmacy Acquisition and Termination: On March 28, 2022, IMC Holdings acquired 51% of the rights in the Oranim Pharm Partnership (the “Oranim Pharmacy Acquisition”). On April 16, 2024, we announced that we would not complete the remaining installment payments, and as a result transferred the 51% interest back to the seller. On July 8, 2024, the parties executed a cancellation agreement addressing the transfer of shares and related matters.

•

an individual who is a citizen or resident of the United States;

•

a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) organized under the laws of the United States, any state thereof or the District of Columbia;

•

an estate whose income is subject to U.S. federal income taxation regardless of its source; or

•

a trust that (i) is subject to the primary supervision of a court within the United States and the control of one or more U.S. persons for all substantial decisions or (ii) has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.

•

at least 25% of the issued shares of any class or series of our capital stock was owned  by or belonged to any combination of (a) the Non-Canadian Holder, (b) persons with whom the Non-Canadian Holder does not deal at arm’s length for purposes of the Canadian Tax Act, and (c) partnerships in which the Non-Canadian Holder or a person described in (b) holds a membership interest directly or indirectly through one or more partnerships, and

•

more than 50% of the fair market value of the Common Shares was derived, directly or indirectly, from one or any combination of: (i) real or immoveable property situated in Canada, (ii) “Canadian resource properties” (as that term is defined in the Canadian Tax Act), (iii) “timber resource properties” (as that term is defined in the Canadian Tax Act) or (iv) options in respect of, or interests in, or for civil law rights in, a property described in any of the foregoing whether or not the property exists.

(in thousands of U.S. dollars)	2025	2024
Audit Fees(1)	$386	$281
Audit-related Fees(2)	$-	$-
Tax Fees(3)	$64	$44
All Other Fees(4)	$-	$29
Total	$450	$354

1.	Audit Fees consist of fees for professional services rendered for the audit of our annual consolidated financial statements and review of our interim financial statements, as well as services that are normally provided in connection with statutory and regulatory filings or engagements.

2.	Audit-Related Fees consist of assurance and related services reasonably related to the performance of the audit or review of our financial statements and not reported under “Audit Fees.”

3.	Tax Fees consist of fees for tax compliance, tax advice and tax planning services.

4.	All Other Fees consist of fees for products and services other than those described above.