Wah Fu Education Group Ltd. to Hold Annual General Meeting on December 20, 2024

Rhea-AI Summary

Wah Fu Education Group (NASDAQ: WAFU) has announced its Annual General Meeting (AGM) scheduled for December 20, 2024, in Beijing. The company plans to implement a significant structural change by adopting a dual-class share structure. Under this proposal, existing ordinary shares will be re-designated into Ordinary Shares (1 vote each) and Class A Shares (15 votes each). The company will increase its authorized shares from 30,000,000 to 600,000,000, split between 500,000,000 Ordinary Shares and 100,000,000 Class A Shares. Each current share will be divided into 20 Ordinary Shares, with the par value changing from US$0.01 to US$0.0005.

Positive

• None.

Negative

• Implementation of dual-class share structure could reduce voting power of current ordinary shareholders
• Share division and creation of Class A shares with 15x voting power may concentrate control

Insights

Legal Expert

The proposed dual-class share structure represents a significant corporate governance shift that warrants careful investor attention. The conversion of existing shares into two classes - regular ordinary shares with 1 vote and Class A shares with 15 votes - will concentrate voting power among Class A shareholders. The automatic conversion trigger at 1,488,000 Class A shares (5% threshold) adds an important safeguard.

The 20:1 share division from $0.01 to $0.0005 par value and increase in authorized shares to 600 million (500M ordinary + 100M Class A) could potentially dilute existing shareholders. This restructuring typically benefits company insiders while reducing public shareholders' voting influence, though it may provide management more flexibility for strategic decisions.

Beijing, China, Dec. 02, 2024 (GLOBE NEWSWIRE) -- Wah Fu Education Group Ltd. (NASDAQ: WAFU, the “Company”) today announced that it will hold its Annual General Meeting (“AGM”), which will be held at L207b, Hesheng Fortune Plaza, No.13 Deshengmenwai Street Xicheng District, Beijing, China 100088, at 10:30 AM, Beijing Time, on December 20, 2024.

Holders of record of the Company’s ordinary shares of par value US $0.01 each on the close of business on November 21, 2024, Eastern Standard Time (the “Record Date”) or their proxy holders are entitled to vote at the AGM or any adjournment or postponements thereof. Each holder of ordinary shares has one (1) vote for each ordinary share held as of the close of business on the Record Date.

Under the existing memorandum and articles of association of the Company, a resolution of shareholders may be passed by the affirmative vote of a majority of in excess of 50% of the votes of the shares entitled to vote thereon which were present at the meeting and were voted.

The Company proposes to amend and restate the existing memorandum and articles of association registered with the Registry of Corporate Affairs in the British Virgin Islands to adopt a dual-class share structure (the “Dual-class Share Structure”), pursuant to which the Company will create a new class of shares and the Company’s issued ordinary shares of US$0.01 par value each shall be re-designated into (i) ordinary shares of US$0.0005 par value each (“Ordinary Share”), and (ii) class A ordinary shares of US$0.0005 par value each (“Class A Shares”), with each Ordinary Share being entitled to one (1) vote and each Class A Share being entitled to fifteen (15) votes on all matters subject to vote at general meetings of the Company.

In connection with the Dual-class Share Structure, the Company proposes to:

	(a)	create a new class of shares and change the maximum number of shares that the Company is authorised to issue from 30,000,000 ordinary shares of US$0.01 par value each to 600,000,000 shares divided into 500,000,000 Ordinary Shares with a par value of US$0.0005 each and 100,000,000 Class A Shares with a par value of US$0.0005 (the “Change in Authorised Shares”);
	(b)	amend and restate its existing memorandum and articles of association registered with the Registrar or Corporate Affairs in the British Virgin Islands to include, amongst other things:
	(i)	the creation of a new class of Class A Shares with each Class A Share being entitled to fifteen (15) votes on all matters subject to vote at general meetings of the Company; and
	(ii)	the following provision: “Notwithstanding any other provision of these Articles, each Class A Share shall be automatically converted into an Ordinary Share immediately upon the holders of Class A Shares in aggregate beneficially owning less than 1,488,000 Class A Shares, which is equivalent to 5% of the total issued and outstanding Class A Shares as of the date of registration of these Memorandum and Articles.”; and
	(c)	conduct a division of shares by which each issued ordinary share of US$0.01 par value each in the Company would be divided into a larger number of Ordinary Shares of US$0.0005 par value each resulting in every one currently issued ordinary share being divided into 20 Ordinary Shares.

The notice of the AGM sets forth the resolutions to be submitted to shareholders of the Company for approval and other relevant information regarding the AGM, the proposed Dual-class Share Structure and how to vote ordinary shares or direct Deutsche Bank Trust Company Americas to vote the ordinary shares represented by the ADSs at the AGM. Shareholders may obtain a copy of the Company’s annual report on Form 20-F, free of charge on the Company’s Investor Relations website at www.edu-edu.cn, or on the website of U.S. Securities and Exchange Commission at http://www.sec.gov. Physical copies of the annual report on Form 20-F can be provided to shareholders of the Company without charge by emailing Wah Fu Education Group Ltd., at ir@edu-edu.com.cn or by writing to:

L207b, Hesheng Fortune Plaza
No.13 Deshengmenwai Street
Xicheng District, Beijing, China 100088
Attention: Raincy Du

INVESTORS AND SHAREHOLDERS ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THE MATERIALS FILED WITH OR FURNISHED TO THE U.S. SECURITIES AND EXCHANGE COMMISSION, AS THEY CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY, THE DUAL-CLASS SHARE STRUCTURE AND RELATED MATTERS.

About Wah Fu Education Group Ltd.

Since its establishment in 1999, Wah Fu Education Group Ltd. (“Wah Fu”) has been committed to providing customized and diversified education solutions for the development of students, institutions and universities. Wah Fu continues to innovate in self-taught examinations for higher academic degrees, information application in adult education, non-degree training and other online educational programs. Wah Fu has become one of the most influential brand of distance education for adults in China. For more information about Wah Fu, please visit www.edu-edu.cn.

Investor Relations Contact

For Wah Fu:

Raincy Du
ir@edu-edu.com.cn

Investor Relations:

Haining Wang
Fair Consulting LLC
Email: info@fairconsulting.co
Phone: +1-646-752-9774(US) /+86-136-8536-8593(China)

FAQ

When is Wah Fu Education Group (WAFU) holding its 2024 Annual General Meeting?

Wah Fu Education Group (WAFU) will hold its Annual General Meeting on December 20, 2024, at 10:30 AM Beijing Time in Beijing, China.

What is the proposed dual-class share structure for WAFU stock?

WAFU proposes to create two share classes: Ordinary Shares with one vote each and Class A Shares with fifteen votes each, both with a par value of US$0.0005.

How many shares will WAFU be authorized to issue under the new structure?

WAFU will be authorized to issue 600,000,000 shares, divided into 500,000,000 Ordinary Shares and 100,000,000 Class A Shares.

What is the share division ratio proposed by WAFU?

WAFU proposes to divide each current ordinary share into 20 Ordinary Shares, changing the par value from US$0.01 to US$0.0005.