Go Up Education Technology Limited — M&A Activity 2015

Dec 31, 2015

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

This announcement appears for information only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities.

WEALTH GLORY HOLDINGS LIMITED 富譽控股有限公司

(Incorporated in the Cayman Islands with limited liability) (Stock Code: 8269)

(I) SECOND SUPPLEMENTAL AGREEMENT TO THE MAJOR TRANSACTION; AND (II) FURTHER EXTENSION OF LONG STOP DATE

This announcement is made pursuant to Rule 19.36 of the GEM Listing Rules.

Reference is made to the announcements (the “ Announcements ”) of the Company dated 23 June 2015, 31 July 2015, 30 September 2015, 23 October 2015 and 30 November 2015 in relation to, among other matters, the major transaction of the Company in respect of the Acquisition and the issue of the Consideration Shares under the Specific Mandate. Unless otherwise defined, capitalised terms used herein shall have the same meanings as those defined in the Announcements.

(I) S E C O N D S U P P L E M E N TA L AG R E E M E N T T O T H E M A J O R TRANSACTION

On 31 December 2015 (after trading hours), the Company (as purchaser), the Sellers (as vendors) and the Target Company entered into a supplemental agreement (the “ Second Supplemental Agreement ”) to further amend various terms of the Purchase Agreement (which was amended and supplemented by a supplemental agreement dated 30 November 2015).

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Change of payment method

Pursuant to the Second Supplemental Agreement, the aggregate consideration of HK$204,000,000 shall be satisfied by the issue of convertible notes in an aggregate principal amount of HK$204,000,000 by the Company (subject to adjustment as set out in the paragraphs headed “New term – Platform Turnover Guarantee” in this section below) instead of the allotment and issue of the Consideration Shares.

In respect of the acquisition of Sale (A) Shares, the Consideration A of HK$52,000,000 shall be payable by the Company to Seller A by the issue of convertible notes of a principal amount of HK$52,000,000 (the “ Convertible (Consideration A) Notes ”) upon completion of the Acquisition.

In respect of the acquisition of Sale (B) Shares, the Consideration B of HK$50,000,000 shall be payable by the Company to Seller B by the issue of convertible notes of a principal amount of HK$50,000,000 (the “ Convertible (Consideration B) Notes ”) upon completion of the Acquisition.

In respect of the acquisition of Sale (C) Shares, the Consideration C of HK$82,000,000 shall be payable by the Company to Seller C by the issue of convertible notes of a principal amount of HK$82,000,000 (the “ Convertible (Consideration C) Notes ”) upon completion of the Acquisition.

In respect of the acquisition of Sale (D) Shares, the Consideration D of HK$20,000,000 shall be payable by the Company to Seller D by the issue of convertible notes of a principal amount of HK$20,000,000 (the “ Convertible (Consideration D) Notes ”, together with the Convertible (Consideration A) Notes, the Convertible (Consideration B) Notes and the Convertible (Consideration C) Notes as the “ Convertible (Considerations) Notes ”) upon completion of the Acquisition.

The conversion price of the Convertible (Considerations) Notes is HK$0.25 per Share (the “ Conversion (Considerations) Price ”) which is the same as the Issue Price of HK$0.25 per Share of the Consideration Shares.

The maximum number of Shares which could be converted under each of the Convertible (Considerations) Notes are as follows:

Convertible (Consideration A) Notes Convertible (Consideration B) Notes Convertible (Consideration C) Notes Convertible (Consideration D) Notes

Maximum number of Shares to be allotted and issued 208,000,000 new Shares 200,000,000 new Shares 328,000,000 new Shares 80,000,000 new Shares

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The maximum number of Shares to be allotted and issued under the Convertible (Considerations) Notes is equivalent to the number of Consideration Shares.

The Shares to be issued under the Convertible (Considerations) Notes shall be issued and allotted under the Specific Mandate proposed to be sought from the Shareholders by way of poll at the EGM.

The Shares to be issued under the Convertible (Considerations) Notes shall be issued as fully paid and shall rank pari passu in all respects with the Shares then in issue. An application will be made by the Company to the Stock Exchange for the listing of, and permission to deal in, the Shares to be issued under the Convertible (Considerations) Notes.

New term – Platform Turnover Guarantee

Pursuant to the Second Supplemental Agreement, the Sellers guaranteed to the Company that the accumulated sales amount recorded on the online distribution platform of the Target Company, namely Letao, shall not be less than RMB225,000,000 (the “ Guaranteed Platform Turnover ”) for a period of 13 months from the issue date of the 1st Batch Convertible Notes (the “ Relevant Period ”). The accountant to be designated by the Company shall review and confirm the actual accumulated sales amount recorded on the online distribution platform (the “ Acutal Platform Turnover ”) within 20 business days after the Relevant Period and issue a certificate (the “ Accountant’s Certificate ”) to confirm the Actual Platform Turnover.

In the event that the Actual Platform Turnover is more than or equal to RMB225,000,000, there will be no adjustment to the principal amount of the Convertible (Considerations) Notes. The Company shall convert the Convertible (Considerations) Notes into the Shares at the Conversion (Considerations) Price within 10 business days after the issue of the Accountant’s Certificate.

In the event that the Actual Platform Turnover is less than RMB225,000,000, the principal amount of each of the Convertible (Considerations) Notes shall be adjusted based on the following formula (the “ Consideration Adjustment ”):

The adjusted principal amount of each of the Convertible (Considerations) Notes (the “Adjusted Convertible (Considerations) Notes”) (Note) = Principal amount of each of the Convertible (Considerations) Notes (Note) x	Actual Platform Turnover
	RMB225,000,000 (being the Guaranteed Platform Turnover)

Note: For avoidance of doubt, adjustment (when necessary) shall be made on each of the Convertible (Consideration A) Notes, Convertible (Consideration B) Notes, Convertible (Consideration C) Notes and Convertible (Consideration D) Notes.

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The Company shall cancel the Convertible (Considerations) Notes and shall issue the Adjusted Convertible (Considerations) Notes to the Sellers within 3 business days after the issue of the Accountant’s Certificate. Subsequently, the Company shall convert the Adjusted Convertible (Considerations) Notes into the Shares at the Conversion (Considerations) Price within 10 business days after the issue of the Adjusted Convertible (Considerations) Notes.

The Sellers have the right to shorten the Relevant Period by issue a notice (the “ Review Notice ”) to the Company. The Company shall arrange its designated accountant to review the Actual Platform Turnover within 20 business days after the receipt of the Review Notice. Such accountant shall review and confirm the Actual Platform Turnover within 20 business days after the commencement of its work and issue the Accountant’s Certificate to confirm the Actual Platform Turnover.

Principal terms of the Convertible (Considerations) Notes

The principal terms and conditions of each of the Convertible (Considerations) Notes are identical except for the principal amount of the notes. The principal terms and considerations of the Convertible (Considerations) Notes are summarised as follows:

Issuer : the Company Principal amount of the : HK$52,000,000 (subject to the Consideration Convertible (Consideration Adjustment) A) Notes Principal amount of the : HK$50,000,000 (subject to the Consideration Convertible (Consideration Adjustment) B) Notes Principal amount of the : HK$82,000,000 (subject to the Consideration Convertible (Consideration Adjustment) C) Notes Principal amount of the : HK$20,000,000 (subject to the Consideration Convertible (Consideration Adjustment) D) Notes Interest rate : nil

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Maturity date	:	The	10th business day after the issue of the
		Accountant’s Certificate or the 10th business
		day	after the adjustment of the principal
		amounts of the Convertible (Considerations)
		Notes
Mandatory conversion by the	:	The	Company has the right to exercise a
Company		mandatory conversion according to the terms of
		the Convertible (Considerations) Notes on the
		maturity date
Transferability	:	Not transferable
Conversion (Considerations)	:	HK$0.25 per new Share (subject to adjustment)
Price
Adjustment to the Conversion	:	The	Conversion (Considerations) Price shall
(Considerations) Price		from time to time be adjusted upon occurrence
		of certain events as followings:
		(i)	an alteration to the nominal value of the
			Shares by reasons of share consolidation
			or sub-division; or
		(ii)	an issue of Shares credited as fully paid to
			the Shareholders by way of capitalisation
			of profits or reserves (including any share
			premium account or capital redemption
			reserve fund); or
		(iii)	a capital distribution made by the
			Company to the Shareholders (whether on
			a reduction of capital or otherwise) or a
			grant by the Company to the Shareholders
			of rights to acquire for cash assets of the
			Company or any of its subsidiaries.

Event of default	:	If any of the following event or circumstances
		occurs, the Convertible (Considerations) Note
		shall become due and payable by the Company
		to the holders of the Convertible (Considerations)
		Notes; however, the principal amount of the
		Convertible (Considerations) Notes is subject to
		the Consideration Adjustment:

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• (i) an encumbrancer takes possession or a receiver, manager or other similar officer is appointed of the whole or any substantial part of the undertaking, property, assets or revenues of the Company or any of its major subsidiaries (and, where any such appointment is made in relation to a major subsidiary, the appointment is not discharged within 7 days of it being made); or

• (ii) the Company or any of its major subsidiaries becomes insolvent or is unable to pay its debts as they fall due or applies for or consents to or suffers the appointment of any administrator, liquidator or receiver of the Company or any of its major subsidiaries or the whole or any substantial part of the undertaking, property, assets or revenues of the Company or any of its major subsidiaries (and, where any such appointment is made in relation to a major subsidiary, the appointment is not discharged or withdrawn within 7 days of it being made) or takes any proceeding under any law for a readjustment or deferment of its respective obligations or any part of them or makes or enters into a general assignment or compromise with or for the benefit of its respective creditors; or

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• (iii) a petition is presented or a proceeding is commenced or an order is made or an effective resolution is passed for the winding-up, insolvency, administration or dissolution of the Company or any of its major subsidiaries (and where any such petition, proceeding or order is presented, commenced or made in relation to a major subsidiary, such petition, proceeding or order is not set aside or withdrawn within 7 days of it being filed, commenced or made), except in the case of winding-up of any subsidiaries of the Company in the course of internal reorganisation without involving insolvency; or

• (iv) a moratorium is agreed or declared in respect of any indebtedness of the Company or any of its major subsidiaries (and, in the case of a major subsidiary, is not lifted within 7 days of it being agreed or declared) or any governmental authority or agency condemns, seizes, compulsorily purchases or expropriates all or a substantial part of the assets of the Company or any of its major subsidiaries.

In the event of default, the Company shall give notice to the holders of the Convertible (Considerations) Notes and arrange its designated accountant to review the Actual Platform Turnover and issue the Accountant’s Certificate within 20 business days.

If the Actual Platform Turnover is more than or equal to RMB225,000,000, there will be no adjustment to the principal amount of the Convertible (Considerations) Notes. The principal amount of the Convertible (Considerations) Notes shall become payable to the holders.

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If the Actual Platform Turnover is less than RMB225,000,000, the principal amount of the Convertible (Considerations) Notes shall be adjusted based on the Consideration Adjustment. The principal amount of the Adjusted Convertible (Considerations) Notes shall become payable to the holders.

Listing

• : No application will be made for listing of the Convertible (Considerations) Notes.

An application will be made by the Company to the Stock Exchange for the listing of, and permission to deal in, the Shares to be coverted and issued under the Convertible (Considerations) Notes.

Change of conditions precedent

Pursuant to the Second Supplemental Agreement, the conditions precedent (d) and (e) to the completion of the Acquisition as set out in the announcement of the Company dated 23 June 2015 shall be amended and read as follows:

• “(d) the Listing Committee of the Stock Exchange having granted the listing of, and permission to deal in the new Shares to be allotted and issued under the Convertible (Considerations) Notes;

• (e) the passing by the Shareholders (except for the Shareholders who are required to abstain from voting under the GEM Listing Rules, if any) at the EGM of all resolutions to approve the Acquisition and the Subscription and the issue of the Convertible (Considerations) Notes;”

As at the date of this announcement, none of the conditions precedent to the completion of the Acquisition have been satisfied or waived by the Company.

Change of the issue time of the 1st Batch Convertible Notes

Pursuant to the Second Supplemental Agreement, the 1st Batch Convertible Notes shall be issued by the Target Company to the Company within 1 month from the date of completion of the Acquisition.

Change of the 2nd Prescribed Period

Pursuant to the Second Supplemental Agreement, the 2nd Prescribed Period shall be changed to six months from the issue date of the 2nd Batch Convertible Notes.

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Change of the 3rd Prescribed Period

Pursuant to the Second Supplemental Agreement, the 3rd Prescribed Period shall be changed to three months from the issue date of the 3rd Batch Convertible Notes.

(II) FURTHER EXTENSION OF LONG STOP DATE

Pursuant to the Second Supplemental Agreement, if the conditions to the completion of the Acquisition have not been satisfied on or before 22 May 2016, or such later date as the Sellers and the Company may agree in writing, the Purchase Agreement shall cease and determine and thereafter neither party shall have any obligations and liabilities towards each other thereunder save for any antecedent breaches of the terms thereof. In other words, the long stop date to the completion of the Acquisition is further extended to 22 May 2016.

The Board considers that the amendments to the Purchase Agreement are in the interest of the Company and the Shareholders as a whole.

Save for the above, all other conditions and major terms of the Purchase Agreement will remain unchanged and continue in full force and effect. There is no other material variation of the terms of the Purchase Agreement.

By Order of the Board Wealth Glory Holdings Limited Wong Ka Wah, Albert Chairman and executive Director

Hong Kong, 31 December 2015

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As at the date of this announcement, the Board comprises eight Directors, including three executive Directors, namely Mr. Wong Ka Wah, Albert, Mr. Hong Sze Lung and Mr. Kwong Yuk Kap; two non-executive Directors namely, Mr. Lau Wan Pui, Joseph and Mr. Law Chung Lam, Nelson and three independent non-executive Directors, namely Mr. Leung Ka Tin, Mr. Tam Chak Chi and Mr. Chow Chi Fai.

This announcement, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the GEM Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this announcement is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this announcement misleading.

This announcement will remain on the GEM website at www.hkgem.com on the “Latest Company Announcements” page for seven days from the date of its publication and on the website of the Company at www.wealthglory.com.

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