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New listing of IMAGE POWER S.A. on NewConnect

The company IMAGE POWER S.A. was newly listed on NewConnect on 7 April 2021.

IMAGE POWER S.A. is the 377^th company listed on NewConnect and the seventh new listing on NewConnect in 2021. 

Key information

*as at the reference price

Issuer’s history and business

The Issuer was established as Saragossa Group S.A. with its registered office in Warsaw on 24 June 2016. Its initial share capital was PLN 100,000.00 divided into 100,000 series A shares with a nominal value of PLN 1.00 per share. The company founders included Chałas i Wspólnicy sp. z o.o. and Creative Solution Resources sp. z o.o. Jarosław Chałas was appointed President of the Management Board.

The Issuer’s name was changed to Image Power S.A. in June 2019. The Issuer then established relations with PlayWay S.A. under a purchase agreement concerning modules and copyright in the games Dieselpunk Wars and Gaming Constructor Simulator for PCs and Nintendo Switch.

The crowdfunding campaign of the game Dieselpunk Wars on www.kickstarter.com was launched on 20 January 2020.

The Issuer is an associate and a member of the PlayWay S.A. Group. Its shareholder PlayWay S.A. with its registered office in Warsaw holds 336,500 shares of the Company representing 21.66% of the Issuer’s share capital conferring 336,500 votes equal to 21.66% of the total vote.

Image Power S.A. is active in the video game sector and specialises in the production and distribution of games for PCs. The Company was established on 24 June 2016 and started game development operations in 2019. The Company attracted PlayWay S.A. as its significant investor in 2019.

The Issuer has released one game for PCs as producer and co-publisher: Dieselpunk Wars. The game was released in early access on Steam on 19 November 2020. The game will be released for Nintendo Switch. Five PC games are in production and another five games in pre-production. Games first released for PCs will later be released for consoles.

Business strategy

The key objective of the Issuer’s business is to produce and distribute several low-budget and mid-budget high-margin games through distributed small developer teams.

The Company is planning to expand its business by producing and distributing many low-budget and mid-budget high-margin games. This policy of the Company’s Management Board mitigates the investment risk involved in the production of any single game. The development strategy will be pursued with a view to the following goals:

I. winning a major position in the video game segment;

II. diversification of the game portfolio by producing and distributing new games for PCs and Nintendo Switch (approx. five games per year);

III. further development of the intellectual potential by setting up additional teams and expanding the existing teams.

The Issuer’s selected financials (PLN):

The Issuer’s share capital according to the entry in the National Court Register is PLN 155,323.30 divided into 1,553,233 ordinary bearer shares with a nominal value of PLN 0.10 per share including:

- 1,000,000 series A ordinary bearer shares with a nominal value of PLN 0.10 per share,

- 350,000 series B ordinary bearer shares with a nominal value of PLN 0.10 per share,

- 100,000 series C ordinary bearer shares with a nominal value of PLN 0.10 per share,

- 50,000 series D ordinary bearer shares with a nominal value of PLN 0.10 per share,

- 53,233,000 series D ordinary bearer shares with a nominal value of PLN 0.10 per share.

According to Article 3a of the Articles of Association of Image Power S.A., the Management Board of the Company is authorised to increase the share capital, by 30 May 2023, by up to PLN 15,000.00 (in words, fifteen thousand PLN). The Company may issue up to 150,000 (in words, one hundred fifty thousand) ordinary bearer shares with a nominal value of PLN 0.10 (in words, ten grosh) per share, taken up for cash. As at the date of this opinion, the Company’s share capital has not been increased within the limits of the authorised capital.

Offering of series D shares

Series D shares were subject to a public offering, taken up in a private subscription at an issue price of PLN 20.00.

• Subscription dates: 17 February 2020 to 21 February 2020 
• Size of the issue: 50,000 shares
• Issue price: PLN 20.00 
• Number of allotted shares: 50,000 shares
• Value of the issue: PLN 1,000,000 
• Number of investors: 2 entities including 1 natural person and 1 legal person

Offering of series E shares

Series E shares were subject to a public offering, taken up in a private subscription at an issue price of PLN 30.00.

• Subscription dates: 6 October 2020 to 4 December 2020 
• Size of the: up to 80,000 offered shares
• Number of allotted shares: 53,233 shares
• Value of the issue: PLN 1,596,990 
• Number of investors: 28 entities including 6 natural persons and 2 legal persons
• One of the persons to whom series E shares were allotted in a natural person who is a member of the supervisory body and took up 16,667 series E shares.

In the issue of series D and E shares, the Company raised PLN 2.6 million for further development. The proceeds will be invested as follows:

− 70% for game production (team fees);

− 15% for game preproduction (team fees);

− 10% for game marketing (online ads, social media ads and services, PR services);

− 5% for overheads (office lease, office expenses, business travel and representation, management fees).

Sale of shares:

In total, 19 transactions in 280,150 shares were concluded at prices ranging from PLN 0.87 to PLN 20 within the 12 months before the submission of the application for the introduction of the Company’s shares to the ATC NC. The total value of the transactions was PLN 1,741,295.

Shareholders:

Financial instruments newly listed on NewConnect:

- 1,000,000 series A ordinary bearer shares

- 350,000 series B ordinary bearer shares

- 100,000 series C ordinary bearer shares

- 50,000 series D ordinary bearer shares

- 53,233 series E ordinary bearer shares