Skillful Craftsman Announces Signing of Non-Binding Term Sheet for a Proposed Convertible Note Financing

Rhea-AI Summary

Skillful Craftsman Education Technology Limited (NASDAQ: EDTK) has announced a non-binding term sheet for a proposed private placement of convertible notes totaling up to US$10 million. The notes are unsecured and will mature in five years, bearing interest at 7% per annum. Notably, these notes can be converted into ordinary shares at an initial price of US$1.82. The Company is negotiating with accredited investors to finalize this deal, emphasizing its vocational education expansion plans in Southeast Asia and the establishment of a subsidiary in Singapore. However, there is no certainty that a definitive agreement will be reached.

Positive

• Proposed private placement of convertible notes totaling up to US$10 million.
• Interest rate of 7% per annum, offering a potential return for investors.
• Conversion of notes into shares could increase equity financing.
• Plans to expand operations in Southeast Asia, which may enhance growth prospects.

Negative

• No assurance that a definitive agreement will be executed.
• Dependence on the successful negotiation with accredited investors.

WUXI, China, March 08, 2023 (GLOBE NEWSWIRE) -- Skillful Craftsman Education Technology Limited (“the Company” or “Skillful Craftsman”) (NASDAQ: EDTK), an education technology company providing interactive online learning services, today announced that it has entered into a non-binding term sheet for a proposed private placement of the Company’s convertible note with a principal amount up to US$10 million.

The note under the proposed financing is designed to be an unsecured general obligation of the Company that will mature in five years following the issuance, bearing interest at the rate of 7% per annum which shall be payable on the maturity date. According to the proposed terms, at any time after the issuance and before the maturity date, the note is convertible, in whole or in part, into the ordinary shares of the Company (the “Ordinary Shares”) at the option of the holder thereof. If the closing bid price of the Ordinary Shares as reported by Nasdaq exceeds the conversion price for at least five consecutive trading days, all of the outstanding balance of the note shall be automatically converted into Ordinary Shares. The conversion price is initially US$1.82 per Ordinary Share, subject to adjustment as set forth in the note. Unless previously converted, the Company shall repay the outstanding principal amount plus all accrued but unpaid interest on the maturity date. Readers are cautioned that the foregoing is a description of the proposed terms that are non-binding and subject to further negotiation by the parties.

There can be no assurance that a definitive agreement will be entered into or that the proposed transaction will be consummated.

Mr. Bill Fu, Co-CEO of Skillful Craftsman, commented, “Currently, we are actively negotiating with accredited investors and strive to sign the definitive agreement promptly. These potential investors have well recognized our vocational education expansion plans in Southeast Asia, which gives us great confidence in increasing our global presence. In addition, we are preparing to establish a Singapore subsidiary and discussing cooperation plans with local partners for providing trainings of professional skills that meet Singapore's qualifications and employment standards. As a senior financial vocational education expert, our Co-Chief Executive Officer and Director Mr. Bin Fu will take in charge of our business development in Southeast Asia. We believe the proposed financing will help propel our global presence in vocational education market and create more value for our shareholders.”

This press release is neither an offer to sell nor a solicitation of an offer to buy the note or the underlying Ordinary Shares, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or jurisdiction. The note under the proposed financing have not been approved or disapproved by any regulatory authority.

About Skillful Craftsman

Skillful Craftsman is an education technology company that provides interactive online vocational training and virtual simulation experimental training courses. The Company began operations in Wuxi, China in 2013 and is a key supporter for China education reform and development for labor employment. For more information, please visit: http://ir.kingwayup.com/.

Safe Harbor Statement

This report contains "forward-looking statements" for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that represent our beliefs, projections and predictions about future events. All statements other than statements of historical fact are "forward-looking statements." Words such as "may," "will," "should," "could," "would," "predicts," "potential," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar expressions, as well as statements in the future tense, identify forward looking statements. Forward-looking statements are based on information available at the time those statements are made and management's belief as of that time with respect to future events. These statements are subjective and involve known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements to differ materially from any future results, performance or achievements described in or implied by such statements. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of whether, or the times by which, our performance or results may be achieved. The Company disclaims any intention to, and undertakes no obligation to, update or revise any forward-looking statement.

For investor and media enquiries, please contact:

Skillful Craftsman

Investor Relations Department

Email: iredtk@kingwayedu.cn

Ascent Investor Relations LLC

Tina Xiao

Tel: +1 917-609-0333

Email: tina.xiao@ascent-ir.com

FAQ

What is the stock symbol for Skillful Craftsman?

The stock symbol for Skillful Craftsman is EDTK.

What is the proposed amount for the convertible notes by Skillful Craftsman?

Skillful Craftsman is proposing a private placement of convertible notes totaling up to US$10 million.

What is the interest rate on the proposed convertible notes?

The proposed convertible notes will bear an interest rate of 7% per annum.

When will the convertible notes mature?

The convertible notes are set to mature in five years following issuance.

What is the initial conversion price for the convertible notes?

The initial conversion price for the notes is US$1.82 per ordinary share.