ESPI 36/2017 The Letter of Intent regarding acquisition of a company providing audio and aroma subscription services

The Board of Directors of IMS S.A. (“the Issuer”) informs that on 17 October 2017 the Issuer and Issuer’s subsidiary, IMS r&d Sp. z o.o. with its registered office in Krakow (“R&D”), signed the letter of intent with the majority shareholder (“the Owner”) of MakeSense Media Sp. z o.o. (“MSM”) with its registered office in Warsaw holding in total 99% of the share capital and 99% of votes in the meeting of shareholders of this company and with the MSM Company itself. The Parties signed the letter so as to specify:

  1. a) the terms and conditions on which R&D will acquire from the Owner a controlling (at least 51%) stake in MSM in exchange for minority interest in R&D which will be subscribed by the Owner of MSM. As a result of the transaction, the Owner of MSM will become a minority, yet significant shareholder in R&D and in MSM;
  2. b) other terms and conditions necessary for the Issuer, R&D and MSM to jointly form a capital group as defined in the International Financial Reporting Standards (“IFRS”);
  3. c) rules for taking by the Owner of MSM of the position of president of the board in R&D and the rules for further acting as the president in MSM;
  4. d) rules for buy-out of minority interest in MSM by R&D or IMS from the Owner of MSM within the time frame of 3-5 years of the acquisition of MSM by R&D (the earn-out model) or another possibility to dispose of shares in MSM by the Owner of MSM after this time period;
  5. e) terms and conditions as well as the deadline for introducing R&D into a public market within the time frame of 3-5 years, or the rules for buy-out of the minority interest in R&D by R&D or IMS from the Owner of MSM within the time frame of 3-5 years of the acquisition of MSM by R&D (the earn-out model) or another possibility to dispose of shares in R&D by the Owner of MSM after this time period;
  6. f) terms and conditions of mutual collaboration between the Issuer, R&D and MSM and other companies, where IMS is

a parent company and with which as at the date of signing this letter it forms a capital group as defined in IFRS.

In particular the parties will determine:

– the plan for development and production of the own line of aroma marketing equipment, taking into consideration a possibility to acquire an EU grant for this purpose;

– the strategy to develop audio, aroma and Digital Signage subscription services in Poland;

– the action strategy in the scope of opportunities for exploitation of synergies resulting from the merger of the Issuer, R&D and MSM.

The Letter of Intent expires on 31.01.2018 and its signing does not constitute a financial commitment for any of the parties. The parties to the letter have declared that by 31.01.2018 they will have managed to determine the terms and conditions mentioned in points a) -f ) above.

Delivered by the board of MSM, the MSM’s financial results (not examined by an auditor) for the last two completed financial years, i.e. 2016 and 2015, are as follows:

 

12 months of 2016

Revenue: PLN 2,598 thousand

EBIT: PLN 250 thousand

EBITDA: PLN 302 thousand

Net profit: PLN 164 thousand

Non-current assets: PLN 381 thousand

Receivables: PLN 1,378 thousand

Equity: PLN 589 thousand

Liabilities and provisions for liabilities: PLN 1,280 thousand
12 months of 2015

Revenue: PLN 1,857 thousand

EBIT: PLN 69 thousand

EBITDA: PLN 133 thousand

Net profit: PLN 49 thousand

Non-current assets: PLN 429 thousand

Receivables: PLN 1,054 thousand

Equity: PLN 434 thousand

Liabilities and provisions for liabilities: PLN 1,165 thousand

MakeSense Media Sp. z o.o. is a company with over 10-year experience in the Polish and international market. It offers solutions in the scope of sensory marketing (aroma and audio marketing). It provides comprehensive marketing solutions for chain stores, shops, restaurants, petrol stations, car showrooms and office space, among others.

The planned acquisition of the controlling stake in MSM is in line with the Issuer’s strategy whose one of the components is growth through acquisitions. The purpose of the acquisition of MSM is to increase the scale of conducted activity and to improve the financial results generated by the IMS Capital Group in the most attractive, subscription segment of its activity (the largest share in MSM revenue is revenue from about 1,600 aroma and audio marketing locations it owns).

ESPI 35/2017 Completion of 5th Tranche of Buy-Back of Own Shares

The Board of Directors of IMS S.A. (“the Company”, “the Issuer”) with reference to current reports No.32/2017 of 06.10.2017 and 33/2017 of 09.10.2017, in connection with transferring by Shareholders of all disposed shares into Issuer’s account informs that on 12 October 2017 the buy-back of own shares as part of 5th Tranche of the Buy-Back Scheme carried out on the basis of Resolution No.19 of the Ordinary General Meeting of the IMS S.A. (“the OGM”) of 9 June 2016 was completed and cleared.

As part of this Tranche the Company acquired 143,577 shares of the total nominal value of PLN 2,871.54, representing 0.43% of the Issuer’s share capital and giving right to 143,577 votes in the GM (0.43% of the total number of votes).

The shares were acquired by the Company at the price of PLN 3.75 per share.

As part of 5th Tranche the Issuer offered to acquire 145,000 own shares (the information was published in current report No.27/2017 of 18.09.2017). As a result of resignation of one of the Shareholders the Company acquired 143,577 shares, that is 1,423 fewer shares than included in the offer to buy as part of 5th Tranche of the Scheme).

As at 12 October 2017 the Issuer holds 539,926 own shares with the total nominal value of PLN 10,798.52, which represent 1.61% of the Issuer’s share capital and give right to 539,926 votes in the GM (1.61% of the total number of votes).

The Issuer, pursuant to Article 364 paragraph 2 of the Commercial Companies Code, does not exercise its right to vote from own shares.

Specific legal basis:

  • 5 paragraph 1 point 6 of the Regulation on current and periodic information

ESPI 34/2017 Information on transactions on shares of the Company

Notification of transactions on shares of the Company – DOWNLOAD

The Board of Directors of IMS S.A. (“the Company”) informs of the receipt on 9 October 2017 of the notification pursuant to Article 19 paragraph 1 of the Market Abuse Regulation from the Vice President of the Board of IMS S.A. Mr Wojciech Grendziński – referring to the disposal of 6,410 shares of IMS S.A.

ESPI 33/2017 Summary of the second day of buying back own shares and the entire 5th Tranche of the Own Share Buy-Back Scheme

The Board of Directors of IMS S.A. (“the Company”, “the Issuer”) informs that on 9 October this year agreements were signed with Shareholders to sell in total 99,879 shares of IMS S.A. The purchase price of one share (in line with Resolution No.1 of the Board of Directors of the Company of 18.09.2017) amounted to PLN 3.75. The total nominal value of acquired shares is PLN 1.997,58 (PLN 0.02 per each share). These shares constitute 0.30% of the Issuer’s share capital and give right to 99,879 votes in the GM (0.30% of the total number of votes).

In line with the Buy-Back Scheme (“the Invitation to submit offers to dispose of shares”), Shareholders have time till 19 October this year to transfer disposed shares to the Company’s account. If the shares being disposed of by a Shareholder are not registered into the securities account of IMS S.A. by 19 October 2017, the sale agreement shall be terminated with no consequences for either of the parties.

If such a situation occurs, the Issuer will inform about it in a separate communication.

The buy-back is carried out on the basis of Resolution No.19 of the OGM of 9 June 2016. The Own Shares Buy-Back Scheme

was adopted by the Board of the Issuer with Resolution No.1 of 26 September 2016 (the Company informed about it in ESPI communication No. 63/2016 of 26 September 2016). Pursuant to the resolution of the OGM, the acquired own shares of the Company may be:

  1. a) redeemed, or
  2. b) intended for resale, or
  3. c) intended for another legitimate purpose indicated by the Board of the Company.

In total in the 5th tranche of the Buy-Back Scheme (i.e. on 06.10.2017 and today), the Company signed with Shareholders agreements to sell 143,577 shares of the total nominal value of PLN 2,871.54, constituting 0.43% of the Issuer’s share capital and giving right to 143,577 votes in the GM (0.43% of the total number of votes).

Additionally, the Company holds 396,349 own shares (of the total nominal value of PLN 7,926.98, representing 1.18% of the Issuer’s share capital; giving right to 396,349 votes in the GM, i.e. 1.18% of the total number of votes) acquired in July 2017 (4th tranche of the buy-back implemented based on Resolution No.19 of the Ordinary General Meeting of IMS S.A. (“the OGM”) of 09.06.2016).
Specific legal basis:

  • 5 paragraph 1 point 6 of the Regulation on current and periodic information

ESPI 32/2017 Summary of the first day of buying back own shares (5th tranche)

The Board of Directors of IMS S.A. (“the Company”, “the Issuer”) informs that on 6 October this year agreements were signed with Shareholders to sell in total 43,698 shares of IMS S.A. The purchase price of one share (in line with Resolution No.1 of the Board of Directors of the Company of 18.09.2017) amounted to PLN 3.75. The total nominal value of acquired shares is PLN 873.96 (PLN 0.02 each share). These shares represent 0.13% of the Issuer’s share capital and give right to 43,698 votes in the GM (0.13% of the total number of votes).

Additionally, the Company holds 396,349 own shares (of the total nominal value of PLN 7,926.98; representing 1.18% of the Issuer’s share capital; giving right to 396,349 votes in the GM, i.e. 1.18% of the total number of votes) acquired in July 2017 (4th tranche of the buy-back implemented based on Resolution No.19 of the Ordinary General Meeting of IMS S.A. (“the OGM”) of 09.06.2016).

In line with the Buy-Back Scheme (“the Invitation to submit offers to dispose of shares”), Shareholders have time till 19 October this year to transfer disposed shares to the Company’s account. If the shares being disposed of by a Shareholder are not registered into the securities account of IMS S.A. by 19 October 2017, the sale agreement shall be terminated with no consequences for either of the parties.

If such a situation occurs, the Issuer will inform about it in a separate communication.

The buy-back is carried out on the basis of Resolution No.19 of the OGM of 9 June 2016. The Own Shares Buy-Back Scheme was adopted by the Board of the Issuer with Resolution No.1 of 26 September 2016 (the Company informed about it in ESPI communication No.63/2016 of 26 September 2016). Pursuant to the resolution of the OGM, the acquired own shares of the Company may be:

  1. a) redeemed, or
  2. b) intended for resale, or
  3. c) intended for another legitimate purpose indicated by the Board of the Company.

Another date of the Company concluding transactions to acquire shares shall be 9 October 2017.
Specific legal basis:

  • 5 paragraph 1 point 6 of the Regulation on current and periodic information

ESPI 30/2017 List of shareholders holding at least 5% of votes in the extraordinary general meeting of ims s.A. On 26.09.2017

The Board of Directors of IMS S.A. (“the Company”) submits a list of shareholders holding at least 5% of votes in the Extraordinary General Meeting of the Company which took place on 26.09.2017, specifying the number of votes attributed to each of them on account of held shares and indicating their percentage share in the number of votes in this General Meeting as well as in the total number of votes.

1) Michał Kornacki – number of held shares: 5,370,000, number of votes attributed to held shares: 5,370,000, which gave right to 39.77% of votes in the Extraordinary General Meeting and constitutes 16.03% of the total votes;

2) CACHEMAN LIMITED – number of held shares: 2,980,000, number of votes attributed to held shares: 2,980,000, which gave right to 22.07% of votes in the Extraordinary General Meeting and constitutes 8.90% of the total votes;

3) Paweł Przetacznik – number of held shares: 2,835,019, number of votes attributed to held shares: 2,835,019, which gave right to 20.99% of votes in the Extraordinary General Meeting and constitutes 8.46% of the total votes;

4) Przemysław Świderski – number of held shares: 1,340,000, number of votes attributed to held shares: 1,340,000, which gave right to 9.92% of votes in the Extraordinary General Meeting and constitutes 4.00% of the total votes.

ESPI 29/2017 Contents of resolutions adopted in the extraordinary general meeting of ims s.A. On 26.09.2017 together with the adopted consolidated text of the articles of association

Extraordinary General Meetings 26.09.2017 – DOWNLOAD

The Articles of Association of the Company – DOWNLOAD

Supplemented content of the Articles of Association of the Company – DOWNLOAD

The Board of Directors of IMS S.A. (“the Company”) presents the text of the attached resolutions adopted on 26.09.2017 by the Extraordinary General Meeting.

To supplement this information, the Company informs that resolution No.7 includes amendments to the Articles of Association, whereas resolution No.8 – the consolidated text of the Articles of Association. The Board provides the attached list of previous and amended provisions of the Articles of Associations.

At the same time, the Board of Directors of the Company informs that during the General Meeting no objections were made to the minutes of the meeting regarding adopted resolutions and no item on the agenda was omitted from the examination.

Detailed legal basis:

  • 38 paragraph 1 point 2 and 7, 8, 9 of the Regulation on current and periodic information

ESPI 28/2017 Adoption by the general meeting of the company of the incentive scheme iii for years 2018 – 2020

In connection with ESPI 24/2017 report, the Board of Directors of IMS S.A. (“the Company”, “the Issuer”) informs that on 26 September 2017 an Extraordinary General Meeting of the Company with Resolution No.4 adopted the Incentive Scheme III for years 2018-2020, based on managerial options, for members of the Board of Directors, managers, employees and associates of the IMS Capital Group Companies and approved the Regulations for this Scheme (“the Regulations for the Incentive Scheme III”, “the Regulations”).

The objective of the Incentive Scheme III directed to members of the Board of IMS S.A. as well as managers, employees and associates of the IMS S.A. Group companies is creating an additional powerful tool motivating to achieve challenging goals by means of such actions as acquisitions of highly profitable entities, generating a high volume of sales on existing products and services as well as acquiring new clients and new markets, which should affect significantly the IMS S.A. share price.

The Incentive Scheme III assumes obtaining rights by persons participating in it to subscribe for not more than in total 1,500,000 series C shares provided that these persons meet the criteria specified in the Regulations III, at the issue price equal to the arithmetic mean of closing prices of IMS S.A. shares on Giełda Papierów Wartościowych w Warszawie S.A. in Warsaw in the period from 01.08.2016 to 31.07.2017 amounting to 3.03 zł (three zloty and three grosz)

A general criterion for acquiring the right to subscribe for shares for a given financial year in the period from 2018 to 2020 (“the acquisition period”) for all participating persons is remaining in the employment relationship with one of the IMS Group companies for at least six months in a given acquisition period and achieving by the IMS Capital Group of at least the below mentioned EBITDA ratios in a given year:

– acquisition period year 2018 – EBITDA of PLN 16.5 million,

– acquisition period year 2019 – EBITDA of PLN 20 million,

– acquisition period year 2020 – EBITDA of PLN 23 million,

A specific criterion is a significant influence of participating persons on the activities of Group companies, which is evaluated by the Supervisory Board, and in the case of persons who are not members of the Board, the evaluation by the Supervisory Board shall be preceded by a written request by the Board of Directors justifying a selection of a given person. The Supervisory Board may withdraw from the general criterion mentioned above, on condition that the participating person or participating persons have a particularly significant effect on financial results of the Group and on condition that EBITDA ratio in a given acquisition period does not differ considerably from the conditions presented above. In the case described in the preceding sentence, the Supervisory Board may award a maximum of not more than 500,000 warrants in total throughout the entire duration of Scheme III (acquisition periods 2018-2020).

The right to subscribe for shares as part of the Incentive Scheme III shall be exercised in form of series C subscription warrants issued by the Company. One warrant shall give right to subscribe for one share. Participants to the Scheme III shall assume an obligation absolutely not to transfer acquired shares (lock-up) for 12 (twelve) months of the date of subscribing for shares.