Current reports

Execution of an investment contract and a contract on the subscription of shares in iPOS S.A.

Current report number: 11/2020

Data: 24 August 2020

Legal basis:

Art. 17 (1) of the Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (‘MAR’).

Content of the report:

The Management Board of OEX Spółka Akcyjna (‘OEX’ or ‘Issuer”) hereby would like to inform whom it may concern that on 24 August 2020 by an between the Issuer, iPOS Spółka Akcyjna (Polish joint-stock company) with registered office in Warsaw (‘iPOS’ or the ‘Company’) and all the existing shareholders in iPOS an investment contract was executed, which laid down detailed terms and conditions of the Issuer’s investment in the Company and regulating the mutual rights and obligations of the parties in relation with the investment and the further operations of iPOS (‘Investment Contract’), including, but not limited to, the rights and limitations concerning the disposal of shares in the Company by its shareholders, standard declarations and representations of iPOS and shareholders as well as the principles of liability of the parties, terms and conditions of the incentive programme for the management personnel, rules of operation of the Company’s governing bodies, no-compete clauses of the members of the Management Board of iPOS. The Investment Contract foresees that OEX shall have a personal right to appoint one member of the Management Board of iPOS and three out of five members of the Supervisory Board of iPOS.

The existing shareholders in iPOS held today an Extraordinary General Meeting of Shareholders of the Company, which resolved, without limitation, an increase in the share capital of iPOS by an issue of 43,000 new shares in iPOS to be subscribed exclusively by OEX (with the exclusion of the subscription rights of the existing shareholders), which, after the share capital increase has been registered by the District Court, will ensure that OEX holds approx. 51.0% of the share capital and of votes at the General Meeting of Shareholders of iPOS as well as control over the company (also in result of the corporate provisions adopted in the amended Articles of Association of iPOS). In this relation, the Issuer entered into the above-mentioned share subscription agreement with and paid to the Company’s bank account the total agreed issue price of PLN 6,000,220.00 (six million two hundred and twenty Polish zlotys).

In accordance with the Investment Agreement, OEX will also have a possibility (but not an obligation) to carry out subsequent tranches of additional payments to iPOS (in 2020 and in 2021) in the total amount of up to approx. PLN 6.0 million, after the so-called pre-money valuation (i.e. as at the state before today’s transaction) of 100% of shares in iPOS (‘Pre-Money Valuation’):

  • in case of the additional payment to be made by 31 December 2020 in the max. amount of approx. PLN 3 million – equal to the valuation of iPOS determined by the first (effected today) investment by OEX, i.e. approx. PLN 5.8 million;
  • in case of the additional payment to be made in the period from 1 January 2021 to 28 February 2021 – dependent on the achievement by iPOS in the period from 1 July 2020 to 31 December 2020 and (settled subsequently) in the period from 1 January 2021 to 30 June 2021 of specified operational and financial targets, however not higher in any case than approx. PLN 18.0 million.

The above-mentioned additional payments, if any, shall have a form of a loan from OEX to iPOS, which then shall be offset with the Company’s amounts due to OEX on account of the subscription of the Company’s shares of an appropriate value (the number of shares subscribed for by OEX shall be indirectly dependent on the achievement of specified targets by iPOS).

In order to implement the above-mentioned arrangements, the general meeting of shareholders of the Company adopted today a resolution on the issue of 60,000 series C subscription warrants, which may be, in the period from 1 January 2021 to 31 October 2021, under certain conditions and in a specified number, given to OEX, and subsequently exchanged for shares in the Company in accordance with the conditional share capital increase as resolved.

Additionally, the Issuer shall have the right (but not an obligation) to make an additional payment to the Company in the period until 30 June 2022 in an additional amount of up to approx. PLN 6 million in the form of a share capital increase, with the exclusion of the subscription rights of the other shareholders, with the Pre-Money Valuation amounting to approx. PLN 18 million.

The Investment Contract contains, furthermore, standard provisions for this type of contracts.

The investment is compliant with the Investor’s strategic goals, i.e. the creation of the value of the OEX Group on the basis of modern technologies. The offering of the OEX Group will be expanded to include technological solutions allowing the clients to service sales in retail outlets and to analyse it in real time and, at the same time to support payments, the significance of which is on the rise in relation with the fact that consumers are switching to non-cash payments. In the opinion of the Issuer’s Management Board, iPOS’s growth potential within a short-term perspective is considerable, which is related to the mandatory exchange of electronic cash registers among certain groups of enterprises, which in accordance with the applicable regulations in force will have to be completed before 1 July 2021. In the longer term, the Management Board of OEX expects growth opportunities in the development of iPOS web, a sales support and analysis platform, where new services will be added, e.g. services based on big data set analyses, AI solutions, and machine learning. In the opinion of the Management Board, synergies with other OEX Group companies are also possible.

Operating since 2014, iPOS is a creator of the market’s first POS system which combines the functions of an electronic cash register and a payment terminal. iPOS’s POS systems are integrated with a proprietary cloud IT platform that supports and analyses the sales as well as manages the goods and warehouses in the SaaS model. The registers meet all the requirements of the so-called online POS systems, as attested by a certification from the Polish Central Office of Measures. iPOS addresses its solutions to SMEs active in the retail segment.

In 2019, iPOS generated revenues of PLN 2.7 million and a net loss of PLN 2.3 million. The Company’s equity as at 31/12/2019 amounted to PLN 4.9 million. On the basis of forecasts prepared by iPOS, the issuer estimates that the impact of iPOS on the consolidated financial performance of the OEX Group in 2020 will amount to approx. PLN 9.1 million in terms of revenues, a loss of PLN 0.9 million in terms of EBITDA and a net loss of PLN 0.6 million attributable to the shareholders of OEX S.A. The Company will be subject to a full consolidation as of September 2020. It is estimated that iPOS will reach the breakeven point in 2021.


Signatures of Company’s representatives:

Tomasz Słowiński – Member of the Management Board
Robert Krasowski – Member of the Management Board