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Xiao-I Corporation to Change its ADS Ratio on August 23, 2024

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Xiao-I (NASDAQ: AIXI), a leading AI company, announces a change in its American Depositary Shares (ADS) ratio effective August 23, 2024. The new ratio will be 1 ADS to 3 ordinary shares, equivalent to a 1-for-9 reverse ADS split. This change affects ADS holders but not underlying ordinary shares. Uncertificated ADS holders in The Depository Trust Company will have their ADSs automatically exchanged. Citibank, N.A., the depositary bank, will manage the exchange process. Fractional new ADSs will be sold, with net proceeds distributed to applicable ADS holders. The ADS trading price is expected to increase proportionally, though this is not guaranteed.

Xiao-I (NASDAQ: AIXI), una delle principali aziende di intelligenza artificiale, annuncia una modifica nel rapporto delle sue Azioni di Deposito Americane (ADS) a partire dal 23 agosto 2024. Il nuovo rapporto sarà di 1 ADS per 3 azioni ordinarie, equivalente a uno split inverso 1 su 9 delle ADS. Questa modifica interessa i detentori di ADS ma non le azioni ordinarie sottostanti. I detentori di ADS non certificati nella Depository Trust Company avranno i loro ADS automaticamente scambiati. Citibank, N.A., la banca depositaria, gestirà il processo di scambio. Le nuove ADS frazionarie saranno vendute, con i proventi netti distribuiti ai detentori di ADS applicabili. Si prevede che il prezzo di scambio delle ADS aumenti proporzionalmente, anche se ciò non è garantito.

Xiao-I (NASDAQ: AIXI), una empresa líder en inteligencia artificial, anuncia un cambio en la proporción de sus Acciones de Depósito Americano (ADS) a partir del 23 de agosto de 2024. La nueva proporción será de 1 ADS por 3 acciones ordinarias, equivalente a un split inverso de 1 por 9 de las ADS. Este cambio afecta a los tenedores de ADS, pero no a las acciones ordinarias subyacentes. Los tenedores de ADS no certificadas en The Depository Trust Company tendrán sus ADS automáticamente intercambiadas. Citibank, N.A., el banco depositario, gestionará el proceso de intercambio. Las nuevas ADS fraccionarias se venderán y los ingresos netos se distribuirán a los tenedores de ADS aplicables. Se espera que el precio de intercambio de las ADS aumente proporcionalmente, aunque esto no está garantizado.

Xiao-I (NASDAQ: AIXI), 선도적인 AI 회사가 2024년 8월 23일부터 미국 예탁주식(ADS) 비율 변경을 발표했습니다. 새로운 비율은 1 ADS당 3 보통주로, 1대 9의 역 분할에 해당합니다. 이 변경은 ADS 소지자에게 영향을 미치지만, 기초 보통주에는 영향을 미치지 않습니다. The Depository Trust Company에 있는 비증서식 ADS 소지자는 그들의 ADS가 자동으로 교환됩니다. Citibank, N.A., 예탁 은행이 교환 과정을 관리합니다. 분할된 새로운 ADS는 판매될 것이며, 순수익은 해당 ADS 소지자에게 분배됩니다. ADS 거래 가격은 비례적으로 인상될 것으로 예상되지만, 이는 보장되지 않습니다.

Xiao-I (NASDAQ: AIXI), une entreprise leader en intelligence artificielle, annonce un changement dans le rapport de ses Actions de Dépôt Américaines (ADS) à compter du 23 août 2024. Le nouveau rapport sera de 1 ADS pour 3 actions ordinaires, équivalent à un fractionnement inversé de 1 pour 9 des ADS. Ce changement affecte les détenteurs d'ADS mais pas les actions ordinaires sous-jacentes. Les détenteurs d'ADS non certifiées au sein de la Depository Trust Company auront leurs ADS automatiquement échangées. Citibank, N.A., la banque dépositaire, gérera le processus d'échange. Les nouvelles ADS fractionnaires seront vendues, et les produits nets seront distribués aux détenteurs d'ADS concernés. On s'attend à ce que le prix de négociation des ADS augmente proportionnellement, bien que cela ne soit pas garanti.

Xiao-I (NASDAQ: AIXI), ein führendes KI-Unternehmen, gibt eine Änderung im Verhältnis seiner American Depositary Shares (ADS) bekannt, die zum 23. August 2024 wirksam wird. Das neue Verhältnis wird 1 ADS zu 3 Stammaktien betragen, was einem 1-zu-9-Rücksplit der ADS entspricht. Diese Änderung betrifft die ADS-Inhaber, jedoch nicht die zugrunde liegenden Stammaktien. Inhaber von nicht-zertifizierten ADS bei der Depository Trust Company werden automatisch ihre ADS umgetauscht bekommen. Citibank, N.A., die Verwahrstelle, wird den Umtauschprozess verwalten. Bruchstückhafte neue ADS werden verkauft, und der Nettoerlös wird an die entsprechenden ADS-Inhaber verteilt. Es wird erwartet, dass der Handelspreis der ADS proportional ansteigt, obwohl dies nicht garantiert ist.

Positive
  • The ADS ratio change may lead to a higher trading price, potentially improving market perception
  • Automatic exchange process for uncertificated ADS holders simplifies the transition
Negative
  • The effective 1-for-9 reverse ADS split may be perceived negatively by some investors
  • Potential loss of value for investors holding fractional ADSs after the exchange
  • No guarantee that the ADS trading price will increase proportionally to the ratio change

Insights

This ADS ratio change is a strategic move by Xiao-I , effectively implementing a 1-for-9 reverse split for their ADSs. While this doesn't directly impact the company's fundamentals, it's likely aimed at boosting the ADS price to meet NASDAQ's minimum bid price requirement of $1 per share. This could help Xiao-I avoid potential delisting risks. However, investors should note that this is merely a technical adjustment and doesn't inherently create value. The market cap remains unchanged and shareholders will own fewer ADSs, each representing more ordinary shares. It's important to monitor post-split trading patterns, as reverse splits can sometimes be perceived negatively by the market, potentially leading to increased selling pressure.

This ADS ratio adjustment by Xiao-I reflects a broader trend among smaller-cap, especially Chinese, NASDAQ-listed companies facing compliance challenges. The move might temporarily boost investor perception by elevating the ADS price, but it's not a long-term solution for underlying business challenges. Investors should focus on Xiao-I's AI technology advancements, market penetration and financial performance rather than this cosmetic change. The timing of this move, amidst global economic uncertainties and U.S.-China tensions, adds another layer of complexity. It's important to monitor how this impacts liquidity and trading volumes, as reduced float can sometimes lead to increased volatility.

SHANGHAI, Aug. 21, 2024 /PRNewswire/ -- Xiao-I Corporation ("Xiao-I" or the "Company") (NASDAQ: AIXI), a leading artificial intelligence company, today announces that the previously announced change of the ratio of its American Depositary Shares (the "ADSs") to its ordinary shares (the "ADS Ratio"), par value US$0.00005 per share, from the current ADS Ratio of one ADS to one-third of an ordinary share to a new ADS Ratio of one ADS to 3 ordinary shares will be effective on August 23, 2024 (U.S. Eastern Time) (the "Effective Date").

For the Company's ADS holders, the change in the ADS Ratio will have the same effect as a one-for-nine reverse ADS split. On the Effective Date, Holders of uncertificated ADSs in The Depository Trust Company (DTC) will have their ADSs automatically exchanged and need not take any action. The exchange of every nine (9) then-held (existing) ADSs for one (1) new ADS will occur automatically at the Effective Date, with the then-held ADSs being cancelled and new ADSs being issued by Citibank, N.A., the depositary bank (the "Depositary"). The Company's ADSs will continue to be traded on the Nasdaq Stock Market under the symbol "AIXI."

No fractional new ADSs will be issued in connection with the change in the ADS Ratio. Instead, fractional entitlements to new ADSs will be aggregated and sold by the Depositary and the net cash proceeds from the sale of the fractional ADS entitlements (after deduction of fees, taxes and expenses) will be distributed to the applicable ADS holders by the Depositary. The change in the ADS Ratio will have no impact on the Company's underlying ordinary shares, and no ordinary shares will be issued or cancelled in connection with the change in the ADS Ratio.

As a result of the change in the ADS Ratio, the ADS trading price is expected to increase proportionally, although the Company can give no assurance that the ADS trading price after the change in the ADS Ratio will be equal to or greater than 9 times the ADS trading price before the change.

About Xiao-I Corporation

Xiao-I Corporation is a leading cognitive intelligence enterprise in China that offers a diverse range of business solutions and services in artificial intelligence, covering natural language processing, voice and image recognition, machine learning, and affective computing. Since its inception in 2001, the Company has developed an extensive portfolio of cognitive intelligence technologies that are highly suitable and have been applied to a wide variety of business cases. Xiao-I powers its cognitive intelligence products and services with its cutting-edge, proprietary AI technologies to enable and promote industrial digitization, intelligent upgrading, and transformation. For more information, please visit: www.xiaoi.com.

Forward-Looking Statements

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as "may," "will," "intend," "should," "believe," "expect," "anticipate," "project," "estimate" or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company's expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company's ability to achieve its goals and strategies, the Company's future business development and plans for future business development, including its financial conditions and results of operations, product and service demand and acceptance, reputation and brand, the impact of competition and pricing, changes in technology, government regulations, fluctuations in general economic and business conditions in China, and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the U.S. Securities and Exchange Commission ("SEC"). For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company's filings with the SEC, including under the section entitled "Risk Factors" in its annual report on Form 20-F filed with the SEC on April 30, 2024, as well as its current reports on Form 6-K and other filings, all of which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

For investor and media inquiries, please contact:
Ms. Berry Xia
Email: ir@xiaoi.com

Cision View original content:https://www.prnewswire.com/news-releases/xiao-i-corporation-to-change-its-ads-ratio-on-august-23-2024-302227143.html

SOURCE Xiao-I Corporation

FAQ

When will Xiao-I (AIXI) change its ADS ratio?

Xiao-I (AIXI) will change its ADS ratio on August 23, 2024 (U.S. Eastern Time).

What is the new ADS ratio for Xiao-I (AIXI)?

The new ADS ratio for Xiao-I (AIXI) will be one ADS to 3 ordinary shares, effectively a 1-for-9 reverse ADS split.

How will the ADS ratio change affect Xiao-I (AIXI) shareholders?

The change will affect ADS holders, effectively resulting in a 1-for-9 reverse ADS split. Underlying ordinary shares will not be impacted. The ADS trading price is expected to increase proportionally, though this is not guaranteed.

What happens to fractional ADSs after Xiao-I 's (AIXI) ratio change?

Fractional new ADSs will be aggregated and sold by the Depositary, with net cash proceeds distributed to applicable ADS holders after deduction of fees, taxes, and expenses.

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