Filed
pursuant to Rule 424(b)(5)
Registration No. 333-256087
The
information in this preliminary prospectus supplement is not complete and may be changed. We may not sell these securities until the
registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus supplement is not
an offer to sell these securities and it is not soliciting offers to buy these securities in any jurisdiction where the offer or sale
is not permitted.
DATED
MAY 24, 2021
SUBJECT
TO COMPLETION
PRELIMINARY
PROSPECTUS SUPPLEMENT
(To
Prospectus dated May 21, 2021)
Ordinary
Shares
METEN
EDTECHX EDUCATION GROUP LTD.
We
are offering ordinary shares, par value US$0.0001 per share (the “ordinary shares”), pursuant to this
prospectus supplement and the accompanying prospectus, at a purchase price of US$ per share.
Our
ordinary shares are listed on The Nasdaq Capital Market, or Nasdaq, under the symbol “METX.” On May 21, 2021, the last reported
sale price of our ordinary shares on Nasdaq was US$1.43 per share.
We
are an “emerging growth company” as defined in the Jumpstart Our Business Act of 2012, as amended, and, as such, will be
subject to reduced public company reporting requirements.
The
aggregate market value of our outstanding ordinary shares held by non-affiliates, or public float, as of May 21, 2021, was approximately
US$99.95 million, which was calculated based on 41,131,464 ordinary shares held by non-affiliates as of May 21, 2021 and a per share
price of US$2.43, which was the closing price of our ordinary shares on Nasdaq on April 6, 2021.
Investing
in our securities involves risks. See “Risk Factors” beginning on page S-3 of this prospectus supplement and on page
2 of the accompanying prospectus.
Neither
the U.S. Securities and Exchange Commission nor any state securities commission nor any other regulatory body has approved or disapproved
of these securities or determined if this prospectus supplement is truthful or complete. Any representation to the contrary is a criminal
offense.
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Per ordinary
share
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Total
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Public offering price
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$
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$
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Underwriting discounts (1)
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$
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$
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Proceeds, before expenses, to us
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$
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$
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(1)
We will also pay the underwriter for certain expenses incurred in this offering. See “Underwriting” on page S-8 of this
prospectus supplement for more information regarding the underwriting compensation.
We
have granted the underwriter an option for a period ending 45 days after the closing of this offering to purchase up to an additional
ordinary shares at the public offering price, less the underwriting discount, solely to cover
over-allotments, if any. If the underwriter exercises the option in full, the total underwriting discount will be $ ,
and the total proceeds to us, before expenses, will be $ .
We
expect that delivery of the ordinary shares being offered pursuant to this prospectus supplement and the accompanying prospectus will
be made on or about May , 2021, subject to customary closing conditions.
Sole
Book-Running Manager
Aegis
Capital Corp.
The
date of this prospectus supplement is May , 2021
Prospectus
ABOUT
THIS PROSPECTUS SUPPLEMENT
On
May 13, 2021, we filed with the Securities and Exchange Commission (the “SEC”) a registration statement on Form F-3 (File
No. 333-256087), utilizing a shelf registration process relating to the securities described in this prospectus supplement, which registration
statement was declared effective by the SEC on May 21, 2021. Under this shelf registration process, we may, from time to time, in one
or more offerings, offer and sell up to US$150,000,000 of any combination, together or separately, of our ordinary shares, par value
US$0.0001 per share, preferred shares, debt securities, warrants, rights, and units, or any combination thereof as described in the accompanying
prospectus. We are selling ordinary shares in this offering. Other than ordinary shares being sold pursuant to this offering, we
have not sold any securities under this shelf registration statement.
This
document is in two parts. The first part is this prospectus supplement, which describes the specific terms of this offering and also
adds to and updates information contained in the accompanying prospectus and the documents incorporated by reference into the prospectus
supplement. The second part, the accompanying prospectus, gives more general information, some of which does not apply to this offering.
You should read this entire prospectus supplement as well as the accompanying prospectus and the documents incorporated by reference
that are described under “Incorporation of Documents by Reference” and “Where You Can Find Additional Information”
in this prospectus supplement and the accompanying prospectus.
If
the description of the offering varies between this prospectus supplement and the accompanying prospectus, you should rely on the information
contained in this prospectus supplement. However, if any statement in one of these documents is inconsistent with a statement in another
document having a later date—for example, a document incorporated by reference in this prospectus supplement and the accompanying
prospectus—the statement in the document having the later date modifies or supersedes the earlier statement. Except as specifically
stated, we are not incorporating by reference any information submitted under any Report of Foreign Private Issuer on Form 6-K into this
prospectus supplement or the accompanying prospectus.
Any
statement contained in a document incorporated by reference, or deemed to be incorporated by reference, into this prospectus supplement
or the accompanying prospectus will be deemed to be modified or superseded for purposes of this prospectus supplement or the accompanying
prospectus to the extent that a statement contained herein, therein or in any other subsequently filed document which also is incorporated
by reference in this prospectus supplement or the accompanying prospectus modifies or supersedes that statement. Any such statement so
modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus supplement or
the accompanying prospectus.
We
further note that the representations, warranties, and covenants made by us in any agreement that is filed as an exhibit to any document
that is incorporated by reference in this prospectus supplement and the accompanying prospectus were made solely for the benefit of the
parties to such agreement, including, in some cases, for the purpose of allocating risk among the parties to such agreements, and should
not be deemed to be a representation, warranty or covenant to you unless you are a party to such agreement. Moreover, such representations,
warranties, or covenants were accurate only as of the date when made or expressly referenced therein. Accordingly, such representations,
warranties, and covenants should not be relied on as accurately representing the current state of our affairs unless you are a party
to such agreement.
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus supplement, the accompanying prospectus, and our SEC filings that are incorporated by reference into this prospectus supplement
contain or incorporate by reference forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E
of the Exchange Act. Many of the forward- looking statements contained in this prospectus supplement can be identified by the use of
forward-looking words such as “anticipate,” “believe,” “could,” “expect,” “should,”
“plan,” “intend,” “estimate,” and “potential,” among others.
Forward-looking
statements appear in a number of places in this prospectus supplement, the accompanying prospectus, and our SEC filings that are
incorporated by reference into this prospectus supplement. These forward-looking statements include, but are not limited to,
statements regarding our intent, belief, or current expectations. Forward-looking statements are based on our management’s
beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and
uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to of
various factors, including, but not limited to, those identified under the section entitle d “Item 3. Key
Information—3.D. Risk Factors” in our annual report on Form 20-F for the fiscal year ended December 31, 2020, the
section entitled “Risk Factors” beginning on page S-3 of this prospectus supplement, and the section entitled
“Risk Factors” beginning on page 2 of the accompanying prospectus. These risks and uncertainties include factors
relating to:
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our goals and growth strategies;
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our future prospects and
market acceptance of our courses and other products and services;
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our future business development,
results of operations, and financial condition;
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expected changes in our
revenue, costs or expenditures;
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our plans to expand and
enhance our courses and other products and services;
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our ability to retain and
increase our student enrollment;
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our plans to expand and
enhance our courses and other products and services;
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our ability to engage,
train and retain new teachers and consultants;
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our ability to maintain
and improve technology infrastructure necessary to operate our online platform;
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our expectations regarding
the demand for, and market acceptance of, our services and our brands;
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relevant government policies
and regulations relating to our business and industry;
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general
economic and business condition in the markets where we operate;
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growth
and competition in the English Language Training (“ELT”) market;
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assumptions underlying
or related to any of the foregoing;
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the length and severity
of the COVID-19 pandemic and its impact on our business and industry;
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legislative and regulatory
developments related to U.S.-listed China-based companies due to lack of PCAOB inspection;
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other factors that may
affect our financial condition, liquidity, and results of operations; and
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other
risk factors discussed under “Item 3. Key Information—3.D. Risk Factors” in our annual report on Form 20-F for
the fiscal year ended December 31, 2020.
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Forward-looking
statements speak only as of the date they are made, and we do not undertake any obligation to update them in light of new information
or future developments or to release publicly any revisions to these statements in order to reflect later events or circumstances or
to reflect the occurrence of unanticipated events, except as, and to the extent required by, applicable securities laws.
PROSPECTUS
SUPPLEMENT
SUMMARY
The
following summary highlights, and should be read in conjunction with, the more detailed information contained elsewhere in this prospectus
supplement, the accompanying prospectus, and the documents incorporated therein by reference. You should read carefully the entire documents,
including our financial statements and related notes, to understand our business, the ordinary shares, and the other considerations that
are important to your decision to invest in the ordinary shares. You should pay special attention to the “Risk Factors” sections
beginning on page S-3 of this prospectus supplement and on page 2 of the accompanying prospectus.
Our
Company
Business
Overview
We
are one of the leading ELT service providers in China. China’s ELT market is segmented into general ELT, test-oriented ELT and
after-school language training sectors. We offer a comprehensive ELT service portfolio comprising of general adult ELT, junior ELT, overseas
training services, online ELT and other English language-related services to students from a wide range of age groups. We conduct our
business through our offline-online business model designed to maximize compatibility within our business segments in order to scale
up at relatively low costs.
As
of December 31, 2020, we had a nationwide offline learning center network of 105 self-operated learning centers (including 20 learning
centers under the “ABC” brand of ABC Education Group, which we acquired in June 2018) covering 28 cities in 15 provinces,
autonomous regions and municipalities in China, and 13 franchised learning centers (including four franchised learning centers under
the “ABC” brand) covering 12 cities in 11 provinces and municipalities in China. Leveraging our experience gained from operating
offline learning centers, we launched our online English learning platform “Likeshuo” in 2014 to further expand our service
reach to a larger student base. As of December 31, 2020, we had approximately 1.79 million registered users on our “Likeshuo”
platform and cumulatively over 320,000 paying users who purchased our online ELT courses or trial lessons. As of the same date, the cumulative
number of student enrollments for our online ELT courses since 2014 was approximately 180,000 and we had delivered over 5.35 million
accumulated course hours to our students online. We also have opened five experiential marketing stores in China to enable our prospective
students to obtain in-person experience of live streaming online ELT courses delivered on our “Likeshuo” platform. We take
advantage of our business model of combining our offline learning center network and online platform to deepen our market penetration
and further develop our business.
Our
qualified personnel, centralized management system driven by artificial intelligence, and technical expertise enable us to create a learning
environment that caters to the specific learning demands of our students. We have experienced teaching staff and development team members,
who are supported by our centralized teaching and management systems to optimize our students’ learning experiences. As of December
31, 2020, we had a team of 1,824 full-time teachers, study advisors and teaching service staff, of which 826 were study advisors and
teaching service staff for our offline and online businesses. As of the same date, we also had 163 full-time and part-time foreign teachers
from English-speaking countries for our offline ELT services. We have a dedicated content development team focusing on developing practical
and innovative education materials independently and in collaboration with our strategic partners. We have built highly centralized and
scalable management systems to manage our teaching, marketing, finance and human resources activities across our offline and online businesses.
In addition to our management systems, we have made significant investments in developing platforms and systems to support our teaching
activities. For example, we utilize the intelligent tracking and learning coaching function of our artificial intelligence-driven teaching
management systems to record and analyze our students’ real-time learning process and personalize the course content to address
their learning needs.
Corporate
Information
Our
principal executive office is located at 3rd Floor, Tower A, Tagen Knowledge & Innovation Center, 2nd Shenyun
West Road, Nanshan District, Shenzhen, Guangdong Province 518000, People’s Republic of China. Our telephone number at this address
is +86 755 8294-5250. Our registered office in the Cayman Islands is located at Cricket Square, Hutchins Drive, PO Box 2681, Grand Cayman,
KY1-1111, Cayman Islands. Our agent for service of process in the United States is Puglisi & Associates, located at 850 Library Avenue,
Suite 204, Newark, Delaware 19711. Our corporate website is https://investor.metenedu-edtechx.com. The information contained in our website
is not a part of this prospectus supplement.
The
Offering
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Ordinary
shares offered by us pursuant to this prospectus supplement
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ordinary shares ( ordinary shares if the underwriter exercises its option to purchase additional ordinary
shares in full)
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Offering
Price
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US$
per ordinary share
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Total
ordinary shares outstanding before this offering
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64,325,637
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Total ordinary shares
outstanding immediately after this offering
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ordinary shares ( ordinary shares if the underwriter exercises its option to purchase additional ordinary
shares in full)
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Over-allotment option
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We
have granted the underwriter an option, exercisable until 45 days after the closing of this offering, to acquire purchase up to
additional ordinary shares solely to cover over-allotments, if any.
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Use of proceeds
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We
intend to use the net proceeds from this offering for working capital and general corporate purposes. See “Use of Proceeds”
on page S-7 of this prospectus supplement.
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Risk factors
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Investing
in our securities involves a high degree of risk. For a discussion of factors you should consider carefully before deciding to invest
in our securities, see the information contained in or incorporated by reference under the heading “Risk Factors” beginning
on page S-3 of this prospectus supplement, on page 2 of the accompanying prospectus, and in the other documents incorporated
by reference into this prospectus supplement.
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Listing
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Our
ordinary shares are listed on Nasdaq under the symbol “METX.”
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Unless
otherwise indicated, the number of shares outstanding prior to and after this offering is based on 64,325,637 ordinary shares issued
and outstanding as of May 21, 2021. The number of outstanding shares does not include 5,316,125 ordinary
shares underlying the 5,316,125 warrants outstanding as of May 21, 2021. The number of outstanding shares does not include:
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i.
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5,316,125 ordinary
shares underlying the 5,316,125 warrants outstanding as of May 21, 2021;
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ii.
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11,000,000 shares reserved for issuance to the former Meten shareholders upon achievement of milestone targets; and
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iii.
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500,000 shares reserved under the unit purchase options granted to Chardan Capital Markets,
LLC and I-Bankers Securities, Inc. (including 250,000 ordinary shares included in the units and 250,000 ordinary shares underlying the
250,000 warrants included in the units).
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Unless
otherwise indicated, all information in this prospectus supplement assumes no exercise of the underwriter’s over-allotment option.
On
December 7, 2020, we filed a tender offer statement on Schedule TO, as amended (File number: 005-91479) in relation to our offer to
the holders of outstanding warrants to purchase 12,705,000 ordinary shares, each with an exercise price of $11.50 per share, the
opportunity to exercise the warrants at a temporarily reduced price of $1.40 per ordinary share. The tender offer for warrants
terminated on January 5, 2021. Effective January 6, 2021, we temporarily reduced the exercise price of all outstanding warrants to
$2.50 per share, and added a “full-ratchet” anti-dilution protection with respect to subsequent equity sales in which
any person will be entitled to acquire ordinary shares at an effective price per share that is lower than the then exercise price of
the warrants, subject to customary exceptions (the “Temporary Reduction Period”). As of the date of this prospectus
supplement, the Temporary Reduction Period has not been terminated. Since the offering price per share of this offering is $ per
share, which is lower than $2.50 per share, the exercise price for outstanding warrants will be reduced to
$ upon closing of the offering. The exercise price of our outstanding
warrants will be reset to $11.50 per share on the date following which the closing price of our ordinary shares has been equal to or
greater than $3.00 per share for at least twenty (20) trading days during the preceding thirty (30) trading day period, and such
exercise price will no longer be subject to the “full-ratchet” anti-dilution protection. The one-time full-ratchet
anti-dilution protection will also terminate upon the closing of bona fide equity financing (meaning raising gross proceeds of at
least $10 million) by the Company at a per share price above $2.50 during the Temporary Reduction Period.
RISK
FACTORS
The
following is a summary of certain risks that should be carefully considered along with the other information contained or incorporated
by reference in this prospectus supplement, the accompanying prospectus, and the documents incorporated by reference, as updated by our
subsequent filings under the Exchange Act. Particularly, you should carefully consider the risk factors incorporated by reference to
our annual report on Form 20-F for the fiscal year ended December 31, 2020 and in the accompanying prospectus. If any of the following
events actually occurs, our business, operating results, prospects, or financial condition could be materially and adversely affected.
The risks described below are not the only ones that we face. Additional risks not presently known to us or that we currently deem immaterial
may also significantly impair our business operations and could result in a complete loss of your investment.
Risks
Related to this Offering and our Ordinary Shares
Since
our management will have broad discretion in how we use the proceeds from this offering, we may use the proceeds in ways with which you
disagree.
Our
management will have significant flexibility in applying the net proceeds of this offering. You will be relying on the judgment of our
management with regard to the use of those net proceeds, and you will not have the opportunity, as part of your investment decision,
to influence how the proceeds are being used. It is possible that the net proceeds will be invested in a way that does not yield a favorable,
or any, return for us. The failure of our management to use such funds effectively could have a material adverse effect on our business,
financial condition, operating results, and cash flow.
Future
sales of our ordinary shares, whether by us or our shareholders, could cause the price of our ordinary shares to decline.
If
our existing shareholders sell, or indicate an intent to sell, substantial amounts of our ordinary shares in the public market, the trading
price of our ordinary shares could decline significantly. Similarly, the perception in the public market that our shareholders might
sell our ordinary shares could also depress the market price of our shares. A decline in the price of our ordinary shares might impede
our ability to raise capital through the issuance of additional ordinary shares or other equity securities. In addition, the issuance
and sale by us of additional ordinary shares, or securities convertible into or exercisable for our ordinary shares, or the perception
that we will issue such securities, could reduce the trading price for our ordinary shares as well as make future sales of equity securities
by us less attractive or not feasible. The sale of ordinary shares issued upon the exercise of our outstanding warrants could further
dilute the holdings of our then existing shareholders.
We
do not know whether a market for the ordinary shares will be sustained or what the trading price of the ordinary shares will be and as
a result it may be difficult for you to sell your ordinary shares.
Although
our ordinary shares trade on Nasdaq, an active trading market for the ordinary shares may not be sustained. It may be difficult for you
to sell your ordinary shares without depressing the market price for the ordinary shares. As a result of these and other factors, you
may not be able to sell your ordinary shares. Further, an inactive market may also impair our ability to raise capital by selling ordinary
shares, or may impair our ability to enter into strategic partnerships or acquire companies or products by using our ordinary shares
as consideration.
Securities
analysts may not cover our ordinary shares and this may have a negative impact on the market price of our ordinary shares.
The
trading market for our ordinary shares will depend, in part, on the research and reports that securities or industry analysts publish
about us or our business. We do not have any control over independent analysts (provided that we have engaged various non-independent
analysts). We do not currently have and may never obtain research coverage by independent securities and industry analysts. If no independent
securities or industry analysts commence coverage of us, the trading price for our ordinary shares would be negatively impacted. If we
obtain independent securities or industry analyst coverage and if one or more of the analysts who covers us downgrades our ordinary shares,
changes their opinion of our shares or publishes inaccurate or unfavorable research about our business, the price of our ordinary shares
would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for
our ordinary shares could decrease and we could lose visibility in the financial markets, which could cause the price and trading volume
of our ordinary shares to decline.
You
will experience immediate dilution as a result of this offering and may experience future dilution as a result of future equity offerings
or other equity issuances.
We
believe that purchaser of ordinary shares in this offering will experience an immediate dilution relative to net tangible book value
per ordinary share. Our net tangible book value on December 31, 2020 was US$58.53 million, or US$1.03 per ordinary share. After
giving effect to the sale of our ordinary shares of approximately US$ million in this offering at an
offering price of US$ per ordinary share, and after deducting the underwriting discounts and estimated
offering expenses payable by us in connection with this offering, our as adjusted net tangible book value as of December 31, 2020
would have been US$ million, or US$ per ordinary share. This represents
an immediate increase in net tangible book value of US$ per ordinary share to our existing
shareholders and an immediate decrease in net tangible book value of US$ per ordinary share to the
investor participating in this offering.
We
may in the future issue additional ordinary shares or other securities convertible into or exchangeable for our ordinary shares. We cannot
assure you that we will be able to sell our ordinary shares or other securities in any other offering or other transactions at a price
per ordinary share that is equal to or greater than the price per ordinary share paid by the investor in this offering. The price per
ordinary share at which we sell additional ordinary shares or other securities convertible into or exchangeable for our ordinary shares
in future transactions may be higher or lower than the price per ordinary share in this offering. If we do issue any such additional
ordinary shares, such issuance also will cause a reduction in the proportionate ownership and voting power of all other shareholders.
Because
we do not expect to pay dividends in the foreseeable future, you must rely on the price appreciation of our ordinary shares for return
on your investment.
We
currently intend to retain most, if not all, of our available funds and any future earnings to fund the development and growth of our
business. As a result, we do not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on an investment
in our ordinary shares as a source for any future dividend income.
Our
board of directors has complete discretion as to whether to distribute dividends, subject to certain requirements of Cayman Islands law.
In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our
board of directors. Under Cayman Islands law, a Cayman Islands company may pay a dividend out of either profit or share premium account,
provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts as they fall
due in the ordinary course of business. Even if our board of directors decides to declare and pay dividends, the timing, amount and form
of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements
and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions,
and other factors deemed relevant by our board of directors. Accordingly, the return on your investment in our ordinary shares will likely
depend entirely upon any future price appreciation of our ordinary shares. There is no guarantee that our ordinary shares will appreciate
in value or even maintain the price at which you purchased the ordinary shares. You may not realize a return on your investment in our
ordinary shares and you may even lose your entire investment in our ordinary shares.
Techniques
employed by short sellers may drive down the market price of our ordinary shares.
Short
selling is the practice of selling securities that the seller does not own but rather has borrowed from a third party with the intention
of buying identical securities back at a later date to return to the lender. The short seller hopes to profit from a decline in the value
of the securities between the sale of the borrowed securities and the purchase of the replacement shares, as the short seller expects
to pay less in that purchase than it received in the sale. As it is in the short seller’s interest for the price of the security
to decline, many short sellers publish, or arrange for the publication of, negative opinions regarding the relevant issuer and its business
prospects in order to create negative market momentum and generate profits for themselves after selling a security short. These short
attacks have, in the past, led to selling of shares in the market.
Public
companies listed in the United States that have a substantial majority of their operations in China have been the subject of short selling.
Much of the scrutiny and negative publicity has centered on allegations of a lack of effective internal control over financial reporting
resulting in financial and accounting irregularities and mistakes, inadequate corporate governance policies or a lack of adherence thereto
and, in many cases, allegations of fraud. As a result, many of these companies are now conducting internal and external investigations
into the allegations and, in the interim, are subject to shareholder lawsuits and/or SEC enforcement actions.
We
may in the future be the subject of unfavorable allegations made by short sellers. Any such allegations may be followed by periods of
instability in the market price of our ordinary shares and negative publicity. If and when we become the subject of any unfavorable allegations,
whether such allegations are proven to be true or untrue, we could have to expend a significant amount of resources to investigate such
allegations and/or defend ourselves. While we would strongly defend against any such short seller attacks, we may be constrained in the
manner in which we can proceed against the relevant short seller by principles of freedom of speech, applicable federal or state law
or issues of commercial confidentiality. Such a situation could be costly and time- consuming and could distract our management from
growing our business. Even if such allegations are ultimately proven to be groundless, allegations against us could severely impact our
business operations and shareholder’s equity, and the value of any investment in our could be greatly reduced or rendered worthless.
As
an exempted company incorporated in the Cayman Islands with limited liability, we are permitted to adopt certain home country practices
in relation to corporate governance matters that differ significantly from the Nasdaq corporate governance listing standards; these practices
may afford less protection to shareholders than they would enjoy if we complied fully with the Nasdaq corporate governance listing standards.
As
an exempted company incorporated in the Cayman Islands company with limited liability that is listed on the Nasdaq, we are subject to
the Nasdaq corporate governance listing standards. However, Nasdaq rules permit a foreign private issuer like us to follow the corporate
governance practices of its home country. Certain corporate governance practices in the Cayman Islands, which is our home country, may
differ significantly from the Nasdaq corporate governance listing standards. We have relied on and plan to rely on home country practice
with respect to our corporate governance. Specifically, we do not plan to have a majority of independent directors serving on our board
of directors or to establish a nominating committee and a compensation committee composed entirely of independent directors, and we are
not required to seek shareholder approval for issuance 20% or more of our outstanding ordinary shares or voting power in a private offering.
As a result, our shareholders may be afforded less protection than they otherwise would enjoy under the Nasdaq corporate governance listing
standards applicable to U.S. domestic issuers.
CAPITALIZATION
The
following table sets forth our capitalization as of December 31, 2020:
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on
an actual basis, as derived from our audited consolidated financial statements as of December 31, 2020, which are incorporated by reference
into this prospectus supplement;
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on
a pro forma basis, to give effect to the issuance of 7,451,089 ordinary shares since December 31, 2020; and
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on
an as adjusted pro forma basis to give further effect to the issuance and sale of
ordinary shares at the offering price of US$ per ordinary share,
after deducting underwriting discounts and expenses and estimated offering expenses payable
by us.
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You
should read this table together with our consolidated financial statements and notes included in the information incorporated by reference
into this prospectus supplement and the accompanying prospectus.
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As of December 31, 2020
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Actual
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Pro Forma
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Pro Forma
As Adjusted
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RMB
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US$(1)
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RMB
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|
|
US$
|
|
|
RMB
|
|
|
US$(1)
|
|
|
|
|
(in thousands, except share and per share data)
|
|
|
Shareholders’ Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ordinary Shares (US$0.0001 par value, 500,000,000 shares authorized, 56,874,548 shares issued outstanding as of December 31, 2020; 64,325,637 shares outstanding on a pro forma basis as of December 31, 2020; and shares outstanding on a pro forma as adjusted basis as of December 31, 2020)
|
|
|
37
|
|
|
|
6
|
|
|
|
42
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
Additional paid-in capital
|
|
|
557,535
|
|
|
|
85,446
|
|
|
|
654,764
|
|
|
|
100,347
|
|
|
|
|
|
|
|
|
|
|
Accumulated deficit
|
|
|
(936,247
|
)
|
|
|
(143,486
|
)
|
|
|
(936,247
|
)
|
|
|
(143,486
|
)
|
|
|
|
|
|
|
|
|
|
Non-controlling interests
|
|
|
16,133
|
|
|
|
2,472
|
|
|
|
16,133
|
|
|
|
2,472
|
|
|
|
|
|
|
|
|
|
|
Total Shareholders’ Equity
|
|
|
(362,542
|
)
|
|
|
(55,562
|
)
|
|
|
(265,308
|
)
|
|
|
(40,661
|
)
|
|
|
|
|
|
|
|
|
|
Total Capitalization
|
|
|
113,749
|
|
|
|
17,433
|
|
|
|
128,652
|
|
|
|
19,717
|
|
|
|
|
|
|
|
|
|
Notes:
|
(1)
|
Unless
otherwise noted, all translations from Renminbi to U.S. dollars and from U.S. dollars to
Renminbi in this table are made at RMB6.5250 to US$1.00, the exchange rate set forth in the
H.10 statistical release of the Federal Reserve Board on December 31, 2020. We make no representation
that any Renminbi or U.S. dollar amounts could have been, or could be, converted into U.S.
dollars or Renminbi, as the case may be, at any particular rate, the rates stated above,
or at all.
|
|
(2)
|
The preceding table excludes:
|
|
|
|
|
|
|
i.
|
5,316,125 ordinary shares underlying the 5,316,125 warrants (with the exercise price of $2.50 per share during the Temporary Reduction Period being reset to $ per share) outstanding as of May 21, 2021;
|
|
|
|
|
|
|
ii.
|
11,000,000 shares reserved for issuance to the former Meten shareholders upon achievement of milestone targets; and
|
|
|
|
|
|
|
iii.
|
500,000 shares reserved under the unit purchase options granted to Chardan Capital Markets, LLC and I-Bankers Securities, Inc. (including 250,000 ordinary shares included in the units and 250,000 ordinary shares underlying the 250,000 warrants included in the units).
|
DILUTION
Our
net tangible book value on December 31, 2020 was US$58.53 million, or US$1.03 per ordinary share. “Net tangible book value”
is total assets minus the sum of liabilities and intangible assets. “Net tangible book value per share” is net tangible book
value divided by the total number of shares outstanding.
After
giving effect to the sale of our ordinary shares of approximately US$ million in this offering at an offering
price of US$ per ordinary share, and after deducting the underwriting discounts and estimated offering
expenses payable by us in connection with this offering, our as adjusted net tangible book value as of December 31, 2020 would have been
US$ million, or US$ per ordinary share. This represents an immediate increase
in net tangible book value of US$ per ordinary share to our existing shareholders and an immediate decrease
in net tangible book value of US$ per ordinary share to the investor participating in this offering.
The
following table illustrates the net tangible book value dilution per ordinary share to shareholders after the issuance of the ordinary
shares in this offering:
|
Public
offering price per ordinary share
|
|
US$
|
|
|
|
Net
tangible book value per ordinary share as of December 31, 2020
|
|
US$
|
1.03
|
|
|
Increase
per ordinary share attributable to existing investors under this prospectus supplement
|
|
US$
|
|
|
|
As
Adjusted net tangible book value per ordinary share after this offering
|
|
US$
|
|
|
|
Net
tangible book value dilution per ordinary share to new investors
|
|
US$
|
|
|
The
foregoing table and discussion is based on 56,872,548 ordinary shares outstanding as of December 31, 2020.
This
discussion of dilution, and the table quantifying it, assumes no exercise of any outstanding options over our ordinary shares.
USE
OF PROCEEDS
We
estimate that the net proceeds from this offering will be approximately US$ million, after deducting the
underwriting discounts and the estimated offering expenses payable by us.
We
intend to use the net proceeds from this offering for working capital and other general corporate purposes.
The
amounts and timing of our use of proceeds will vary depending on a number of factors, including the amount of cash generated or used
by our operations, and the rate of growth, if any, of our business. As a result, we will retain broad discretion in the allocation of
the net proceeds of this offering.
UNDERWRITING
Subject
to the terms and conditions set forth in the underwriting agreement, dated May , 2021, between us and Aegis
Capital Corp. (the “underwriter” or “Aegis”) as the exclusive underwriter of this offering, we have agreed to
sell to the underwriter, and the underwriter has agreed to purchase from us the number of ordinary shares shown opposite its name below:
|
Underwriter
|
|
Number of
ordinary
shares
|
|
|
Aegis Capital Corp.
|
|
|
|
|
|
Total
|
|
|
|
|
The
underwriting agreement provides that the obligations of the underwriter are subject to certain conditions precedent such as the receipt
by the underwriter of officers’ certificates and legal opinions and approval of certain legal matters by their counsel. The underwriting
agreement provides that the underwriter will purchase all of the shares if any of them are purchased. We have agreed to indemnify the
underwriter against specified liabilities, including liabilities under the Securities Act, and to contribute to payments the underwriter
may be required to make in respect thereof.
The
underwriter is offering the ordinary shares subject to prior sale, when, as and if issued to and accepted by them, subject to approval
of legal matters by its counsel and other conditions specified in the underwriting agreement. The underwriter reserves the right to withdraw,
cancel or modify offers to the public and to reject orders in whole or in part.
We
have granted the underwriter an over-allotment option. This option, which is exercisable for 45 days after the closing of this offering,
permits the underwriter to purchase up to an aggregate of additional ordinary shares (equal to 15% of
the number of shares offered hereby) at the public offering price per share, less underwriting discounts, solely to cover over-allotments,
if any. If the underwriter exercises this option in whole or in part, then the underwriter will be severally committed, subject to the
conditions described in the underwriting agreement, to purchase the additional ordinary shares in proportion to their respective commitments
set forth in the prior table.
Underwriting
Discounts and Reimbursement
The
underwriter has advised us that it proposes to offer the ordinary shares to the public at the public offering price per share set forth
on the cover page of this prospectus supplement. The underwriter may offer ordinary shares to securities dealers at that price less a
concession of not more than $ per ordinary share of which up to $ per ordinary
share may be reallowed to other dealers. After the offering, the public offering price, concession and reallowance to dealers may be
reduced by the underwriter. No such reduction will change the amount of proceeds to be received by us as set forth on the cover page
of this prospectus supplement.
The
following table summarizes the underwriting discounts and proceeds, before expenses, to us assuming no exercise and full exercise by
the underwriter of its over-allotment option, respectively:
|
|
|
|
|
|
Total
|
|
|
|
|
Per ordinary
share
|
|
|
Without
Option
|
|
|
With
Option
|
|
|
Public offering price
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Underwriting discounts (7%)
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Proceeds, before expenses, to us
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
In
addition, we have also agreed to pay all expenses in connection with the offering, including the following expenses: (a) all filing fees
and expenses relating to the registration of the shares with SEC; (b) all FINRA public offering filing fees; (c) all fees and expenses
relating to the listing of the Company’s equity or equity-linked securities on an Exchange; (d) all fees, expenses and disbursements
relating to the registration or qualification of the shares under the “blue sky” securities laws of such states and other
jurisdictions as Aegis may reasonably designate (including, without limitation, all filing and registration fees, and the reasonable
fees and disbursements of the Company’s “blue sky” counsel, which will be Aegis’s counsel) unless such filings
are not required in connection with the Company’s proposed Exchange listing; (e) all fees, expenses and disbursements relating
to the registration, qualification or exemption of the shares under the securities laws of such foreign jurisdictions as Aegis may reasonably
designate; (f) the costs of all mailing and printing of the offering documents; (g) transfer and/or stamp taxes, if any, payable upon
the transfer of shares from the Company to the underwriter; and (h) the fees and expenses of the Company’s accountants; and (i)
a maximum of $50,000 for fees and expenses including “road show”, diligence, and reasonable legal fees and disbursements
for the underwriter’s legal counsel.
We
estimate the expenses of this offering payable by us, not including underwriting discounts, including amounts for which we agreed to
reimburse the underwriter for certain of its expenses, will be approximately $.
Lock-Up
Agreements
The
Company, and each of its directors and executive officers, have agreed for a period of 120 days, after the date of the lock-up agreements,
subject to certain exceptions, without the prior written consent of the underwriter, not to directly or indirectly:
|
|
●
|
issue
(in the case of us), offer, sell, or otherwise transfer or dispose of, directly or indirectly, any shares of capital stock of the
Company or any securities convertible into or exercisable or exchangeable for the shares of capital stock of the Company; or
|
|
|
●
|
in
the case of us, file or caused to be filed any registration statement with the SEC relating to the offering of any shares of capital
stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company
except for (i) the adoption of an equity incentive plan and the grant of awards or equity pursuant to any equity incentive plan,
and the filing of a registration statement on Form S-8; provided, however, that any sales by parties to the lock-ups shall be subject
to the lock-up agreements and (ii) this issuance of shares in connection with an acquisition or a strategic relationship which may
include the sale of equity securities; provided, that none of such shares shall be saleable in the public market until the expiration
of the 120 day period described above.
|
Securities
Issuance Standstill
The Company has agreed, for a period
of ninety (90) days after the closing date of this offering, that it will not, without the prior written consent of the underwriter, issue,
enter into any agreement to issue or announce the issuance or proposed issuance of ordinary shares or ordinary share equivalents (or a
combination of units thereof) involving an at-the-market offering or Variable Rate Transaction. “Variable Rate Transaction”
means a transaction in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or
exercisable for, or include the right to receive additional ordinary shares either (A) at a conversion price, exercise price or exchange
rate or other price that is based upon and/or varies with the trading prices of or quotations for the ordinary shares at any time after
the initial issuance of such debt or equity securities, or (B) with a conversion, exercise or exchange price that is subject to being
reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent
events directly or indirectly related to the business of the Company or the market for the ordinary shares or (ii) enters into, or effects
a transaction under, any agreement, including, but not limited to, an equity line of credit, whereby the Company may issue securities
at a future determined price.
Right
of First Refusal
Pursuant
to the terms of the underwriting agreement, if, for the period ending twelve (12) months from the closing of this offering, subject to
certain exceptions set forth in the underwriting agreement, we or any of our subsidiaries (a) decide to finance or refinance any indebtedness,
Aegis (or any affiliate designated by Aegis) shall have the right to act as the sole book-runner, sole manager, sole placement agent
or sole agent with respect to such financing or refinancing; or (b) decide to raise funds by means of a public offering (including an
at-the-market facility) or a private placement or any other capital raising financing of equity, equity-linked or debt securities, Aegis
(or any affiliate designated by Aegis) shall have the right to act as the sole book-running manager, sole underwriter or sole placement
agent for such financing.
Electronic
Offer, Sale and Distribution of Shares
A
prospectus in electronic format may be made available on the websites maintained by the underwriter or one or more of selling group members.
The underwriter may agree to allocate a number of shares to selling group members for sale to its online brokerage account holders. Internet
distributions will be allocated by the underwriter and selling group members that will make internet distributions on the same basis
as other allocations. Other than the prospectus in electronic format, the information on these websites is not part of, nor incorporated
by reference into this prospectus supplement, has not been approved or endorsed by us, and should not be relied upon by investors.
Stabilization
The
underwriter has advised us that it, pursuant to Regulation M under the Exchange Act, and certain persons participating in the offering
may engage in short sale transactions, stabilizing transactions, syndicate covering transactions or the imposition of penalty bids in
connection with this offering. These activities may have the effect of stabilizing or maintaining the market price of the shares at a
level above that which might otherwise prevail in the open market. Establishing short sales positions may involve either “covered”
short sales or “naked” short sales.
“Covered”
short sales are sales made in an amount not greater than the underwriters’ option to purchase additional shares in this offering.
The underwriters may close out any covered short position by either exercising their option to purchase additional shares or purchasing
shares in the open market. In determining the source of shares to close out the covered short position, the underwriter will consider,
among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase
shares through the option to purchase additional shares.
“Naked”
short sales are sales in excess of the option to purchase additional shares. The underwriter must close out any naked short position
by purchasing shares in the open market. A naked short position is more likely to be created if the underwriter is concerned that there
may be downward pressure on the price of our shares in the open market after pricing that could adversely affect investors who purchase
in this offering.
A
stabilizing bid is a bid for the purchase of shares on behalf of the underwriter for the purpose of fixing or maintaining the price of
the shares. A syndicate covering transaction is the bid for or the purchase of shares on behalf of the underwriter to reduce a short
position incurred by the underwriter in connection with the offering. Similar to other purchase transactions, the underwriter’s
purchases to cover the syndicate short sales may have the effect of raising or maintaining the market price of our shares or preventing
or retarding a decline in the market price of our shares. As a result, the price of our shares may be higher than the price that might
otherwise exist in the open market. A penalty bid is an arrangement permitting the underwriter to reclaim the selling concession otherwise
accruing to a syndicate member in connection with the offering if the shares originally sold by such syndicate member are purchased in
a syndicate covering transaction and therefore have not been effectively placed by such syndicate member.
Neither
we nor the underwriter makes any representation or prediction as to the direction or magnitude of any effect that the transactions described
above may have on the price of our shares. The underwriter is not obligated to engage in these activities and, if commenced, any of the
activities may be discontinued at any time.
The
underwriter may also engage in passive market making transactions in our shares on Nasdaq in accordance with Rule 103 of Regulation M
during a period before the commencement of offers or sales of our shares in this offering and extending through the completion of distribution.
A passive market maker must display its bid at a price not in excess of the highest independent bid of that security. However, if all
independent bids are lowered below the passive market maker’s bid, that bid must then be lowered when specified purchase limits
are exceeded.
Other
Relationships
The
underwriter and certain of its affiliates are full service financial institutions engaged in various activities, which may include securities
trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging,
financing and brokerage activities. The underwriter and certain of its affiliates may in the future perform, various commercial and investment
banking and financial advisory services for us and our affiliates, for which they would receive customary fees and expenses.
In
the ordinary course of their various business activities, the underwriter and certain of its affiliates may make or hold a broad array
of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including
bank loans) for their own account and for the accounts of their customers, and such investment and securities activities may involve
securities and/or instruments issued by us and our affiliates. The underwriter and certain of its respective affiliates may also communicate
independent investment recommendations, market color or trading ideas and/or publish or express independent research views in respect
of such securities or instruments and may at any time hold, or recommend to clients that they acquire, long and/or short positions in
such securities and instruments.
Offer
Restrictions Outside the United States
Other
than in the United States, no action has been taken by us or the underwriter that would permit a public offering of the shares offered
by this prospectus supplement in any jurisdiction where action for that purpose is required. The shares offered by this prospectus supplement
and the accompanying prospectus may not be offered or sold, directly or indirectly, nor may this prospectus supplement or any other offering
material or advertisements in connection with the offer and sale of any such shares be distributed or published in any jurisdiction,
except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into
whose possession this prospectus supplement comes are advised to inform themselves about and to observe any restrictions relating to
the offering and the distribution of this prospectus supplement. This prospectus supplement does not constitute an offer to sell or a
solicitation of an offer to buy any shares offered by this prospectus supplement in any jurisdiction in which such an offer or a solicitation
is unlawful.
LEGAL
MATTERS
We
are being represented by Hunter Taubman Fischer & Li LLC with respect to certain legal matters of U.S. federal securities and New
York State law. The validity of the securities offered in this offering and certain other legal matters as to Cayman Islands law will
be passed upon for us by Conyers Dill & Pearman. Legal matters as to PRC law will be passed upon for us by Commerce & Finance
Law Offices. Hunter Taubman Fischer & Li LLC may rely upon Conyers Dill & Pearman with respect to matters governed by Cayman
Islands law and Commerce & Finance Law Offices with respect to matters governed by PRC law. Certain legal matters in connection with
this offering will be passed upon for the underwriter by Kaufman & Canoles, P.C., Richmond, Virginia with respect to U.S. laws.
EXPERTS
The
consolidated financial statements of Meten EdtechX Education Group Ltd. (the “Company”) and its subsidiaries as of December
31, 2020 and the adjustments described in Note 1(b) that were applied to restate the financial statements for the year ended December
31, 2019 incorporated in this prospectus supplement by reference to the Annual Report on Form 20-F for the year ended December 31, 2020
have been so incorporated in reliance on the report of Audit Alliance LLP, an independent registered public accounting firm, given the
authority of said firm as experts in auditing and accounting.
The
consolidated balance sheet of Meten International Education Group (operating as Meten EdtechX Education Group Ltd. after the reverse
recapitalization described in Note 1 to the financial statements) and the subsidiaries, its variable interest entities and the subsidiaries
of its variable interest entities as of December 31 2019, the related consolidated statements of comprehensive income (loss), changes
in deficit, and cash flows for each of the year in the two-year period ended December 31, 2019, and the related notes, before the effects
of the retrospective adjustments related to the reverse recapitalization discussed in Note 1 to the financial statements, have been incorporated
by reference in this prospectus supplement in reliance upon the report of KPMG Huazhen LLP, an independent registered public accounting
firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.
We
have agreed to indemnify and hold KPMG Huazhen LLP harmless against and from any and all legal costs and expenses incurred by KPMG Huazhen
LLP in successful defense of any legal action or proceeding that arises as a result of KPMG Huazhen LLP’s consent to the inclusion
of its audit report on the past financial statements of Meten International Education Group, its subsidiaries, its variable interest
entities and the subsidiaries of its variable interest entities, before the effects of the retrospective adjustments related to the reverse
recapitalization discussed in Note 1 to the financial statements, incorporated by reference in this prospectus supplement.
The
registered business address of Audit Alliance LLP is No.20 Maxwell Road, #11-09, Maxwell House, Singapore.
The
registered business address of KPMG Huazhen LLP is 15th Floor, China Resources Tower, 2666 Keyuan South Road, Nanshan District, Shenzhen,
China 518052.
INCORPORATION
OF DOCUMENTS BY REFERENCE
The
SEC allows us to “incorporate by reference” into this prospectus supplement certain information that we file with the
SEC. This means that we can disclose important information to you by referring you to those documents. Any statement contained in a
document incorporated by reference in this prospectus supplement shall be deemed to be modified or superseded for purposes of this
prospectus supplement to the extent that a statement contained herein, or in any subsequently filed document, which also is
incorporated by reference herein, modifies or supersedes such earlier statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this prospectus supplement.
We
hereby incorporate by reference into this prospectus supplement the following documents:
|
|
(1)
|
our
annual report on Form 20-F for the fiscal year ended December 31, 2020, as amended, initially
filed with the SEC on April 30, 2021 and amended on May 7, 2021;
|
|
|
|
|
|
|
(2)
|
our
current report on Form 6-K furnished on May 20, 2021;
|
|
|
|
|
|
|
(3)
|
the
description of our ordinary shares contained in our registration statements on Form 8-A,
filed with the SEC on March 31, 2020 and May 26, 2020, respectively, and any amendment or
report filed for the purpose of updating such description;
|
|
|
|
|
|
|
(4)
|
any
future annual reports on Form 20-F filed with the SEC after the date of this prospectus supplement and prior to the termination of the
offering of the securities offered by this prospectus supplement; and
|
|
|
|
|
|
|
(5)
|
any
future reports of foreign private issuer on Form 6-K that we furnish to the SEC after the date of this prospectus supplement that are
identified in such reports as being incorporated by reference into the registration statement of which this prospectus supplement forms
a part.
|
Our
annual report on Form 20-F for the fiscal year ended December 31, 2020, as amended, initially filed with the SEC on April 30, 2021 contains
a description of our business and audited consolidated financial statements with a report by our independent auditors. These statements
were prepared in accordance with U.S. GAAP.
Unless
expressly incorporated by reference, nothing in this prospectus supplement shall be deemed to incorporate by reference information furnished
to, but not filed with, the SEC. Copies of all documents incorporated by reference in this prospectus supplement, other than exhibits
to those documents unless such exhibits are specially incorporated by reference in this prospectus supplement, will be provided at no
cost to each person, including any beneficial owner, who receives a copy of this prospectus supplement on the written or oral request
of that person made to:
METEN
EDTECHX EDUCATION GROUP LTD.
3rd
Floor, Tower A
Tagen
Knowledge & Innovation Center
2nd
Shenyun West Road, Nanshan District
Shenzhen,
Guangdong Province 518000
People’s
Republic of China
Tel:
+86 755 8294-5250
You
should rely only on the information that we incorporate by reference or provide in this prospectus supplement. We have not authorized
anyone to provide you with different information. We are not making any offer to sell these securities in any jurisdiction where the
offer or sale is not permitted. You should not assume that the information contained or incorporated in this prospectus supplement by
reference is accurate as of any date other than the date of the document containing the information.
WHERE
YOU CAN FIND ADDITIONAL INFORMATION
As
permitted by SEC rules, this prospectus supplement omits certain information and exhibits that are included in the registration statement
of which this prospectus supplement forms a part. Since this prospectus supplement may not contain all of the information that you may
find important, you should review the full text of these documents. If we have filed a contract, agreement, or other document as an exhibit
to the registration statement of which this prospectus supplement forms a part, you should read the exhibit for a more complete understanding
of the document or matter involved. Each statement in this prospectus supplement, including statements incorporated by reference as discussed
above, regarding a contract, agreement, or other document is qualified in its entirety by reference to the actual document.
We
are subject to periodic reporting and other informational requirements of the Exchange Act as applicable to foreign private issuers.
Accordingly, we are required to file reports, including annual reports on Form 20-F, and other information with the SEC. All information
filed with the SEC can be inspected over the Internet at the SEC’s website at www.sec.gov and copied at the public reference facilities
maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You can request copies of these documents, upon payment of a duplicating
fee, by writing to the SEC.
As
a foreign private issuer, we are exempt under the Exchange Act from, among other things, the rules prescribing the furnishing and content
of proxy statements, and our executive officers, directors and principal shareholders are exempt from the reporting and short-swing profit
recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file
periodic or current reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are
registered under the Exchange Act.
PROSPECTUS
Up to US$150,000,000 of
Ordinary Shares,
Preferred Shares, Debt Securities,
Warrants,
Rights and Units
METEN EDTECHX EDUCATION GROUP LTD.
We may, from time to time, in one or more offerings, offer
and sell up to US$150,000,000 of any combination, together or separately, of our ordinary shares, par value US$0.0001 per share, preferred
shares, debt securities, warrants, rights, and units, or any combination thereof as described in this prospectus. In this prospectus,
references to the term “securities” refers collectively to our ordinary shares, preferred shares, debt securities, warrants,
rights, and units. The prospectus supplement for each offering of securities will describe in detail the plan of distribution for that
offering. For general information about the distribution of the securities offered, please see “Plan of Distribution” in this
prospectus.
This prospectus provides a general description of the
securities we may offer. We will provide the specific terms of the securities offered in one or more supplements to this prospectus. We
may also authorize one or more free writing prospectuses to be provided to you in connection with these offerings. The prospectus supplement
and any related free writing prospectus may add, update, or change information contained in this prospectus. You should read carefully
this prospectus, the applicable prospectus supplement, and any related free writing prospectus, as well as the documents incorporated
or deemed to be incorporated by reference, before you invest in any of our securities. This prospectus may not be used to offer or
sell any securities unless accompanied by the applicable prospectus supplement.
Our ordinary shares are listed on The Nasdaq Capital Market,
or Nasdaq, under the symbol “METX.” On May 12, 2021, the last reported sale price of the ordinary shares on Nasdaq was US$1.39
per ordinary share.
Our warrants are listed on Nasdaq under the symbol “METXW.”
On May 12, 2021, the last reported sale price of the warrants was US$0.22 per warrant.
We have experienced and may continue to experience price
volatility in our ordinary shares. See related risk factors in our most recent annual report on Form 20-F.
The aggregate market value of our outstanding ordinary
shares held by non-affiliates, or public float, as of May 12, 2021, was approximately US$53.5 million, which was calculated based on 38,478,159
ordinary shares held by non-affiliates and the per price of US$1.39, which was the closing price of our ordinary shares on Nasdaq on May
12, 2021. During the 12 calendar months prior to and including the date of this prospectus, we have not offered or sold any securities
pursuant to General Instruction I.B.5 of Form F-3.
Investing in our securities involves risks.
See “Risk Factors” beginning on page 2 of this prospectus and risk factors set forth in our most recent annual report
on Form 20-F, in other reports incorporated herein by reference, and in an applicable prospectus supplement under the heading
“Risk Factors.”
We may offer and sell the securities from time to time
at fixed prices, at market prices, or at negotiated prices, to or through underwriters, to other purchasers, through agents, or through
a combination of these methods. If any underwriters are involved in the sale of any securities with respect to which this prospectus is
being delivered, the names of such underwriters and any applicable commissions or discounts will be set forth in a prospectus supplement.
The offering price of such securities and the net proceeds we expect to receive from such sale will also be set forth in a prospectus
supplement. See “Plan of Distribution” elsewhere in this prospectus for a more complete description of the ways in which the
securities may be sold.
Neither the U.S. Securities and Exchange Commission
nor any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus
is May 21, 2021
TABLE OF CONTENTS
ABOUT THIS
PROSPECTUS
This prospectus is part of a registration statement that
we filed with the U.S. Securities and Exchange Commission (the “SEC”) utilizing a “shelf” registration process.
Under this shelf registration process, we may, from time to time, sell the securities described in this prospectus in one or more offerings,
up to a total offering amount of US$150,000,000.
This prospectus provides you with a general description
of the securities we may offer. This prospectus and any accompanying prospectus supplement do not contain all of the information included
in the registration statement. We have omitted parts of the registration statement in accordance with the rules and regulations of the
SEC. Statements contained in this prospectus and any accompanying prospectus supplement about the provisions or contents of any agreement
or other documents are not necessarily complete. If the SEC rules and regulations require that an agreement or other document be filed
as an exhibit to the registration statement, please see that agreement or document for a complete description of these matters. This prospectus
may be supplemented by a prospectus supplement that may add, update, or change information contained or incorporated by reference in this
prospectus. You should read both this prospectus and any prospectus supplement or other offering materials together with additional information
described under the headings “Where You Can Find Additional Information” and “Incorporation of Documents by Reference.”
Each time we sell securities under this shelf registration,
we will provide a prospectus supplement that will contain certain specific information about the terms of that offering, including a description
of any risks related to the offering. A prospectus supplement may also add, update, or change information contained in this prospectus
(including documents incorporated herein by reference). If there is any inconsistency between the information in this prospectus and the
applicable prospectus supplement, you should rely on the information in the prospectus supplement. The registration statement we filed
with the SEC includes exhibits that provide more details on the matters discussed in this prospectus. You should read this prospectus
and the related exhibits filed with the SEC and the accompanying prospectus supplement together with additional information described
under the headings “Incorporation of Documents by Reference” before investing in any of the securities offered.
The information in this prospectus is accurate as of the
date on the front cover. Information incorporated by reference into this prospectus is accurate as of the date of the document from which
the information is incorporated. You should not assume that the information contained in this prospectus is accurate as of any other date.
You should rely only on the information provided or incorporated
by reference in this prospectus or in the prospectus supplement. We have not authorized anyone to provide you with additional or different
information. This document may only be used where it is legal to sell these securities.
As permitted by SEC rules and regulations, the registration
statement of which this prospectus forms a part includes additional information not contained in this prospectus. You may read the registration
statement and the other reports we file with the SEC at its website or at its offices described below under “Where You Can Find
Additional Information.”
COMMONLY USED DEFINED TERMS
Unless otherwise indicated or the context requires otherwise,
references in this prospectus or in a prospectus supplement to:
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“after-school language training” are to academic English language training services provided to K-12 students;
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“we,” “us,” “our Company,” “the Company” and “our” are to Meten EdtechX Education Group Ltd. and its subsidiaries;
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“China” or the “PRC” are to the People’s Republic of China, excluding, for the purposes of this annual report only, Taiwan and the special administrative regions of Hong Kong and Macau;
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“Code” are to the U.S. Internal Revenue Code of 1986, as amended;
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“ELT” are to English language training;
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“general ELT” are to services that help students improve their English language skills, particularly English communication skills;
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“gross billings” are to the total amount of cash received for the sales of our products and services during a specific period of time, net of the total amount of refunds for that period, which is not a measure under U.S. GAAP;
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“learning center” are to the physical establishment of an education facility providing general adult ELT, junior ELT and international standardized test preparation under our overseas training services at a specific geographic location in the PRC, directly operated by our VIEs and their respective subsidiaries or operated by franchise partners;
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“offline ELT” are to our offline services, which include general adult ELT, junior ELT and overseas training services;
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“RMB” and “Renminbi” are to the legal currency of China;
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“student enrollments” or “student enrollment” are to the number of actual new sales contracts entered into between Meten and its students, excluding the number of refunded contracts and contracts with no revenue generated during a specified period of time;
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“test-oriented ELT” are to services that help students achieve higher scores in specific standardize tests, including TOEFL, IELTS, GRE, SAT and other international standardized examinations;
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“tier one cities” are to Beijing, Shanghai, Guangzhou and Shenzhen;
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“tier two cities” are to provincial capitals, regional centers or economically developed cities in China, including, among others, Chengdu, Hangzhou, Chongqing, Wuhan and Tianjin;
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“tier three cities” and “tier four cities” are to small- to mid-sized cities in China that are strategically located or have relatively developed or large local economy;
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“dollars,” “US$” and “U.S. dollars” are to the legal currency of the United States;
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“U.S. GAAP” are to generally accepted accounting principles in the United States;
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“variable interest entities” or “VIEs” are to Shenzhen Meten International Education Co., Ltd., or Shenzhen Meten, and Shenzhen Likeshuo Education Co., Ltd., or Shenzhen Likeshuo, which are PRC companies in which Meten does not have equity interests but whose financial results have been consolidated by Meten in accordance with U.S. GAAP due to Meten having effective control over, and being the primary beneficiary of, these companies; and “affiliated entities” refers to VIEs, the VIEs’ direct and indirect subsidiaries, and the VIEs’ affiliated entities that are registered as private non-enterprise institutions under the PRC laws; and
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years are to the calendar year from January 1 to December 31 and references to our fiscal year or years are to the fiscal year or years ended December 31.
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CAUTIONARY NOTE REGARDING
FORWARD-LOOKING STATEMENTS
This prospectus, an applicable prospectus supplement,
and our SEC filings that are incorporated by reference into this prospectus contain or incorporate by reference forward-looking statements
within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”). Many of the forward-looking statements contained in this prospectus can be identified by the use of forward-looking words
such as “anticipate,” “believe,” “could,” “expect,” “should,” “plan,”
“intend,” “estimate,” and “potential,” among others.
Forward-looking statements appear in a number of places
in this prospectus, an applicable prospectus supplement, and our SEC filings that are incorporated by reference into this prospectus.
These forward-looking statements include, but are not limited to, statements regarding our intent, belief, or current expectations. Forward-looking
statements are based on our management’s beliefs and assumptions and on information currently available to our management. Such
statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking
statements due to of various factors, including, but not limited to, those identified under the section entitled “Item 3. Key Information—3.D.
Risk Factors” in our annual report on Form 20-F for the fiscal year ended December 31, 2020. These risks and uncertainties include
factors relating to:
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our goals and growth strategies;
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our future prospects and market acceptance of our courses and other products and services;
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our future business development, results of operations, and financial
condition;
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expected changes in our revenue, costs or expenditures;
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our plans to expand and enhance our courses and other products and services;
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our ability to retain and increase our student enrollment;
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our plans to expand and enhance our courses and other products and services;
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our ability to engage, train and retain new teachers and consultants;
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our ability to maintain and improve technology infrastructure necessary to operate our online platform;
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our expectations regarding the demand for, and market acceptance of, our services and our brands;
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relevant government policies and regulations relating to our
business and industry;
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general economic and business condition in the markets where we operate;
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growth and competition in the ELT markets;
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assumptions underlying or related to any of the foregoing;
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the length and severity of the recent COVID-19 outbreak and its
impact on our business and industry;
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legislative and regulatory developments related to U.S.-listed
China-based companies due to lack of PCAOB inspection;
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other factors that may affect our financial condition, liquidity,
and results of operations; and
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other risk factors discussed under “Item 3. Key Information—3.D. Risk Factors” in our
annual report on Form 20-F for the fiscal year ended December 31, 2020.
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Forward-looking statements speak only as of the date
they are made, and we do not undertake any obligation to update them in light of new information or future developments or to release
publicly any revisions to these statements in order to reflect later events or circumstances or to reflect the occurrence of unanticipated
events.
OUR COMPANY
Business Overview
We are one of the leading ELT service providers in China.
China’s ELT market is segmented into general ELT, test-oriented ELT and after-school language training sectors. We offer a comprehensive
ELT service portfolio comprising of general adult ELT, junior ELT, overseas training services, online ELT and other English language-related
services to students from a wide range of age groups. We conduct our business through our offline-online business model designed to maximize
compatibility within our business segments in order to scale up at relatively low costs.
As of December 31, 2020, we had a nationwide offline learning
center network of 105 self-operated learning centers (including 20 learning centers under the “ABC” brand of ABC Education
Group, which we acquired in June 2018) covering 28 cities in 15 provinces, autonomous regions and municipalities in China, and 13 franchised
learning centers (including four franchised learning centers under the “ABC” brand) covering 12 cities in 11 provinces and
municipalities in China. Leveraging our experience gained from operating offline learning centers, we launched our online English learning
platform “Likeshuo” in 2014 to further expand our service reach to a larger student base. As of December 31, 2020, we had
approximately 1.79 million registered users on our “Likeshuo” platform and cumulatively over 320,000 paying users who purchased
our online ELT courses or trial lessons. As of the same date, the cumulative number of student enrollments for our online ELT courses
since 2014 was approximately 180,000 and we had delivered over 5.35 million accumulated course hours to our students online. We also have
opened five experiential marketing stores in China to enable our prospective students to obtain in-person experience of live streaming
online ELT courses delivered on our “Likeshuo” platform. We take advantage of our business model of combining our offline
learning center network and online platform to deepen our market penetration and further develop our business.
Our qualified personnel, centralized management system driven
by artificial intelligence, and technical expertise enable us to create a learning environment that caters to the specific learning demands
of our students. We have experienced teaching staff and development team members, who are supported by our centralized teaching and management
systems to optimize our students’ learning experiences. As of December 31, 2020, we had a team of 1,824 full-time teachers, study
advisors and teaching service staff, of which 826 were study advisors and teaching service staff for our offline and online businesses.
As of the same date, we also had 163 full-time and part-time foreign teachers from English-speaking countries for our offline ELT services.
We have a dedicated content development team focusing on developing practical and innovative education materials independently and in
collaboration with our strategic partners. We have built highly centralized and scalable management systems to manage our teaching, marketing,
finance and human resources activities across our offline and online businesses. In addition to our management systems, we have made significant
investments in developing platforms and systems to support our teaching activities. For example, we utilize the intelligent tracking and
learning coaching function of our artificial intelligence-driven teaching management systems to record and analyze our students’
real-time learning process and personalize the course content to address their learning needs.
Corporate Information
Our principal executive office is located at 3rd
Floor, Tower A, Tagen Knowledge & Innovation Center, 2nd Shenyun West Road, Nanshan District, Shenzhen, Guangdong Province
518000, the People’s Republic of China. Our telephone number at this address is +86 755 8294-5250. Our registered office in the
Cayman Islands is located at Cricket Square, Hutchins Drive, PO Box 2681, Grand Cayman, KY1-1111, Cayman Islands. Our agent for service
of process in the United States is Puglisi & Associates, located at 850 Library Avenue, Suite 204, Newark, Delaware 19711. Our corporate
website is www.investor.metenedu-edtechx.com. The information contained in our website is not a part of this prospectus.
RISK FACTORS
Investing in our securities involves risks. Before making
an investment decision, you should carefully consider the risks described under “Risk Factors” in the applicable prospectus
supplement and under the heading “Item 3. Key Information—3.D. Risk Factors” in our annual report on Form 20-F for the
fiscal year ended December 31, 2020, which is incorporated in this prospectus by reference, as updated by our subsequent filings under
the Exchange Act that are incorporated herein by reference, together with all of the other information appearing in this prospectus or
incorporated by reference into this prospectus and any applicable prospectus supplement, in light of your particular investment objectives
and financial circumstances. In addition to those risk factors, there may be additional risks and uncertainties of which management is
not aware or focused on or that management deems immaterial. Our business, financial condition, or results of operations could be materially
adversely affected by any of these risks. The trading price of our securities could decline due to any of these risks, and you may lose
all or part of your investment.
OFFER STATISTICS AND EXPECTED
TIMETABLE
We may from time to time, offer and sell any combination
of the securities described in this prospectus up to a total dollar amount of US$150,000,000 in one or more offerings. The securities
offered under this prospectus may be offered separately, together, or in separate series, and in amounts, at prices, and on terms to be
determined at the time of sale. We will keep the registration statement of which this prospectus is a part effective until such time as
all of the securities covered by this prospectus have been disposed of pursuant to and in accordance with such registration statement.
CAPITALIZATION AND INDEBTEDNESS
Our capitalization will be set forth in the applicable prospectus
supplement or in a report on Form 6-K subsequently furnished to the SEC and specifically incorporated by reference into this prospectus.
DILUTION
If required, we will set forth in a prospectus supplement
the following information regarding any material dilution of the equity interests of investors purchasing securities in an offering under
this prospectus:
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the net tangible book value per share of our equity securities
before and after the offering;
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the amount of the increase in such net tangible book value per share attributable to the cash payments
made by purchasers in the offering; and
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the amount of the immediate dilution from the public offering price which will be absorbed by such purchasers.
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USE OF PROCEEDS
We intend to use the net proceeds from the sale of securities
we offer as indicated in the applicable prospectus supplement, information incorporated by reference, or free writing prospectus.
DESCRIPTION OF SHARE CAPITAL
We are an exempted company incorporated under the laws
of the Cayman Islands and our affairs are governed by our Amended and Restated Memorandum and Articles of Association, as amended and
restated from time to time, and Companies Act (Revised) of the Cayman Islands (the “Companies Act”), and the common law of
the Cayman Islands.
As of the date of this prospectus, our authorized share
capital was US$50,000 divided into 500,000,000 ordinary shares each with a par value of US$0.0001. As of the date of this prospectus,
there are 64,325,637 ordinary shares issued and outstanding.
Our Amended and Restated Memorandum and Articles
of Association
The following are summaries of material provisions of our Amended
and Restated Memorandum and Articles of Association and the Companies Act insofar as they relate to the material terms of our ordinary
shares and warrants.
Ordinary Shares
General. Our ordinary shares are fully paid
and non-assessable. Shareholders who are non-residents of the Cayman Islands may freely hold and transfer their ordinary shares.
Dividends. The holders of our ordinary shares
are entitled to such dividends as may be declared by our board of directors. Dividends may be declared and paid out of the funds legally
available therefor. Dividends may also be declared and paid out of share premium account or any other fund or account which can be authorized
for this purpose in accordance with the Companies Act.
Classes of Ordinary Shares. We have only one
class of ordinary shares with all shares carrying equal rights and ranking pari passu with one another
Voting Rights. In respect of all matters subject
to a shareholders’ vote, holders of ordinary shares shall, at all times, vote together as one class on all matters submitted to
a vote by the members at any such general meeting. Each ordinary share shall be entitled to one vote on all matters subject to the vote
at our general meetings. Voting at any meeting of shareholders is by show of hands unless a poll is demanded. A poll may be demanded by
the chairman of such meeting or any one or more shareholders representing not less than 10% of the total voting rights of all the shareholders
present in person or by proxy entitled to vote.
An ordinary resolution to be passed at a meeting by the
shareholders requires the affirmative vote of a simple majority of the votes attaching to the ordinary shares cast at a meeting, while
a special resolution requires the affirmative vote of no less than two-thirds of the votes cast attaching to the outstanding ordinary
shares at a meeting and includes a unanimous written resolution. A special resolution will be required for important matters such as a
change of name, reducing the share capital or making changes to our amended and restated memorandum and articles of association to be
in effect assuming approval of all of the charter proposals and upon consummation of the Mergers.
Transfer of Ordinary Shares. Subject to the
restrictions contained in our amended and restated articles of association, any of our shareholders may transfer all or any of his or
her ordinary shares by an instrument of transfer in the usual or common form or any other form approved by our board of directors.
Our board of directors may, in its absolute discretion,
decline to register any transfer of any ordinary share which is not fully paid up or on which we have a lien. Our board of directors may
also decline to register any transfer of any ordinary share unless:
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the instrument of transfer is lodged at the registered office of us or such other place at which the principal register is kept in accordance with the law or the registration office (as the case may be) accompanied by the relevant share certificate(s) and such other evidence as the board of directors may reasonably require to show the right of the transferor to make the transfer (and, if the instrument of transfer is executed by some other person on his behalf, the authority of that person so to do);
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the instrument of transfer is in respect of only one class of shares;
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the instrument of transfer is properly stamped, if required; and
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a fee of such maximum sum as Nasdaq may determine to be payable or such lesser sum as our directors may from time to time require is paid to us in respect thereof.
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If our directors refuse to register a transfer, they shall, within
three months after the date on which the instrument of transfer was lodged, send to each of the transferor and the transferee notice of
such refusal.
The registration of transfers may, after compliance with any notice
required of Nasdaq, be suspended and the register of members closed at such times and for such periods as our board of directors may from
time to time determine, provided, however, that the registration of transfers shall not be suspended nor the register of members closed
for more than 30 days in any year as our board may determine.
Liquidation. On a return of capital on winding-up
or otherwise (other than on conversion, redemption or purchase of ordinary shares), assets available for distribution among the holders
of ordinary shares shall be distributed among the holders of the ordinary shares on a pro rata basis. If our assets available for distribution
are insufficient to repay all of the paid-up capital, the assets will be distributed so that the losses are borne by our shareholders
proportionately.
Calls on Ordinary Shares and Forfeiture of Ordinary Shares.
Our board of directors may from time to time make calls upon shareholders for any amounts unpaid on their ordinary shares in a
notice served to such shareholders at least 14 clear days prior to the specified time of payment. The ordinary shares that have been called
upon and remain unpaid are subject to forfeiture.
Redemption of Ordinary Shares. The Companies Act
and our amended and restated articles of association permit us to purchase our own shares. In accordance with our amended and restated
articles of association and provided the necessary shareholders or board approval have been obtained, we may issue shares on terms that
are subject to redemption, at our option or at the option of the holders of these shares, on such terms and in such manner, including
out of capital, as may be determined by our board of directors.
Variations of Rights of Shares. All or any of the
special rights attached to any class of shares may, subject to the provisions of the Companies Act, be varied with the consent in writing
of the holders of not less than two-thirds of the issued shares of that class, or with the sanction of a resolution passed by at least
a two-thirds majority of the holders of shares of the class present in person or by proxy at a separate general meeting of the holders
of the shares of that class. The rights conferred upon the holders of the shares of any class issued shall not, unless otherwise expressly
provided by the terms of issue of the shares of that class, be deemed to be materially adversely varied by or abrogated by, inter alia,
the creation or allotment or issue of further shares ranking pari passu with or subsequent to such existing class of shares.
General Meetings of Shareholders. Shareholders’
meetings may be convened by a majority of the board of directors or the chairman of the board of directors, and they shall on a member’s
requisition forthwith proceed to convene a general meeting. A member’s requisition is a requisition of shareholders holding at the
date of deposit of the requisition shares which carry in aggregate not less than one-third (1/3) of all votes attaching to all issued
and outstanding shares that as at the date of the deposit carry the right to vote at our general meetings. Advance notice of at least
ten calendar days is required for the convening of our annual general shareholders’ meeting and any other general meeting of shareholders,
provided that a general meeting or our shareholders shall be deemed to have been duly convened if it is so agreed:
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in the case of an annual general meeting by all the shareholders (or their proxies) entitled to attend and vote thereat; and
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in the case of an extraordinary general meeting, by two-thirds (2/3) of the shareholders having a right to attend and vote at the meeting, present in person or by proxy or, in the case of a corporation or other non-natural person, by its duly authorized representative or proxy.
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Any action required or permitted to be taken at any annual or
extraordinary general meetings may be taken only upon the vote of the shareholders at an annual or extraordinary general meeting duly
noticed and convened in accordance with our articles of association and the Companies Act and may not be taken by written resolution of
shareholders without a meeting.
Voting Rights Attaching to the Shares. Subject to
any rights and restrictions for the time being attached to any ordinary share, on a show of hands every shareholder present in person
and every person representing a shareholder by proxy shall, at a shareholders’ meeting, each have one vote and on a poll every shareholder
and every person representing a shareholder by proxy shall have one vote for each share of which he or the person represented by proxy
is the holder.
Inspection of Books and Records. Holders of our
ordinary shares will have no general right under Cayman Islands law to inspect or obtain copies of our list of shareholders or corporate
records. However, we will in provide shareholders with the right to inspect the list of shareholders and to receive annual audited financial
statements. See “Where You Can Find More Information.”
Changes in Capital. We may from time to time by
ordinary resolution:
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increase the share capital by such sum, to be divided into shares of such amount, as the resolution shall prescribe;
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divide the shares into several classes and without prejudice to any special rights previously conferred on the holders of existing shares attach thereto respectively any preferential, deferred, qualified or special rights, privileges, conditions or such restrictions which in the absence of any such determination by our shareholders, as the board of directors may determine
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consolidate and divide all or any of the share capital into shares of a larger amount than the existing shares;
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subdivide the existing shares, or any of them into shares of a smaller amount; or
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cancel any shares which, at the date of the passing of the resolution, have not been taken or agreed to be taken by any person.
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We may by special resolution, subject to any confirmation or consent
required by the Companies Act, reduce our share capital or any capital redemption reserve in any manner permitted by law.
Indemnification of Directors and Officers. Cayman
Islands law does not limit the extent to which a company’s memorandum and articles of association may provide for indemnification
of officers and directors, except to the extent any such provision may be held by the Islands courts to be contrary to public policy,
such as to provide indemnification against willful default, willful neglect, civil fraud or the consequences of committing a crime. Our
memorandum and articles of association will provide for indemnification of our officers and directors to the maximum extent permitted
by law, including for any liability incurred in their capacities as such, except through their fraud or dishonesty.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that
in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is theretofore unenforceable.
Warrants
Each warrant is exercisable to purchase one ordinary share of
the Company at an exercise price of $11.50 per share, subject to adjustment. The warrants expire on March 30, 2025. No fraction of a share
will be issued upon any exercise of a warrant. The exercise price and number of ordinary shares issuable upon exercise of the warrants
may be adjusted in certain circumstances including in the event of a share dividend, or recapitalization, reorganization, merger or consolidation.
However, the warrants will not be adjusted for issuance of ordinary shares at a price below its exercise price.
No warrants will be exercisable for cash unless the Company has
an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus
relating to such ordinary shares is available, and such shares are registered, qualified or exempt from registration under the securities
laws of the state of residence of the holder.
The Company may redeem the outstanding warrants in whole and not
in part, at a price of $0.01 per warrant, upon not less than 30 days’ prior written notice of redemption (the “30-day redemption
period”) to each warrant holder, and if, and only if, the reported last sale price of the ordinary shares (or the closing bid price
of ordinary shares in the event the ordinary shares are not traded on any specific day) equals or exceeds $16.50 per share, subject to
adjustment, for any 20 trading days within a 30 trading day period ending three business days before the redemption notice is sent to
the warrant holders. The Company will not redeem the warrants unless an effective registration statement covering the ordinary shares
issuable upon exercise of the warrants is current and available throughout the 30-day redemption period.
If the Company calls the warrants for redemption as described
above, the Company will have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.”
In such event, each holder would pay the exercise price by surrendering the warrants for that number of ordinary shares equal to the quotient
obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the difference between the
exercise price of the warrants and the “fair market value” (defined below) by (y) the fair market value. In this case, the
“fair market value” shall mean the average reported last sale price of the ordinary shares for the 10 trading days ending
on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants.
The Placement Warrants are identical to the other warrants of
the Company, except that such Placement Warrants will be exercisable for cash or on a cashless basis, at the holder’s option, and
will not be redeemable by the Company, in each case so long as they are still held by the initial purchasers or their permitted transferees.
Transfer Agent and Registrar
The transfer agent and registrar for our ordinary shares in the
United States is Continental Stock Transfer & Trust Company.
Listing
Our ordinary shares and warrants are quoted on the Nasdaq under
the symbols “METX” and “METXW,” respectively.
Differences in Corporate Law
The Companies Act is derived, to a large extent, from the
older Companies Acts of England, but does not follow many recent English law statutory enactments. In addition, the Companies Act differs
from laws applicable to United States corporations and their shareholders. Set forth below is a summary of the significant differences
between the provisions of the Companies Act applicable to us and the laws applicable to companies incorporated in the State of Delaware.
This discussion does not purport to be a complete statement of the rights of our shareholders under applicable law in the Cayman Islands
and our Amended and Restated Memorandum and Articles of Association nor the rights of holders of the common stock of a typical corporation
under applicable Delaware law and a typical certificate of incorporation and bylaws.
Mergers and Similar Arrangements. The Companies
Act permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies.
For these purposes, (a) “merger” means the merging of two or more constituent companies and the vesting of their undertaking,
property and liabilities in one of such companies as the surviving company, and (b) a “consolidation” means the combination
of two or more constituent companies into a consolidated company and the vesting of the undertaking, property and liabilities of such
companies to the consolidated company. In order to effect such a merger or consolidation, the directors of each constituent company must
approve a written plan of merger or consolidation, which must then be authorized by (a) a special resolution of the shareholders of each
constituent company, and (b) such other authorization, if any, as may be specified in such constituent company’s articles of association.
The written plan of merger or consolidation must be filed with the Registrar of Companies of the Cayman Islands together with a declaration
as to the solvency of the consolidated or surviving company, a declaration as to the assets and liabilities of each constituent company
and an undertaking that a copy of the certificate of merger or consolidation will be given to the members and creditors of each constituent
company and that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Court approval is not required
for a merger or consolidation which is effected in compliance with these statutory procedures.
A merger between a Cayman parent company and its Cayman
subsidiary or subsidiaries does not require authorization by a resolution of shareholders of that Cayman subsidiary if a copy of the plan
of merger is given to every member of that Cayman subsidiary to be merged unless that member agrees otherwise. For this purpose, a company
is a “parent” of a subsidiary if it holds issued shares that together represent at least ninety percent (90%) of the votes
at a general meeting of the subsidiary.
The consent of each holder of a fixed or floating security
interest over a constituent company is required unless this requirement is waived by a court in the Cayman Islands.
Save in certain limited circumstances, a shareholder of
a Cayman constituent company who dissents from the merger or consolidation is entitled to payment of the fair value of his shares (which,
if not agreed between the parties, will be determined by the Cayman Islands court) upon dissenting to the merger or consolidation, provide
the dissenting shareholder complies strictly with the procedures set out in the Companies Act. The exercise of dissenter rights will preclude
the exercise by the dissenting shareholder of any other rights to which he or she might otherwise be entitled by virtue of holding shares,
save for the right to seek relief on the grounds that the merger or consolidation is void or unlawful.
Separate from the statutory provisions relating to mergers
and consolidations, the Companies Act also contains statutory provisions that facilitate the reconstruction and amalgamation of companies
by way of schemes of arrangement, provided that the arrangement is approved by a majority in number of each class of shareholders and
creditors with whom the arrangement is to be made, and who must in addition represent three-fourths in value of each such class of shareholders
or creditors, as the case may be, that are present and voting either in person or by proxy at a meeting, or meetings, convened for that
purpose. The convening of the meetings and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands.
The Companies Act also contains a statutory power of compulsory
acquisition which may facilitate the “squeeze out” of a dissenting minority shareholder upon a tender offer. When a tender
offer is made and accepted by holders of 90.0% of the shares affected within four months, the offeror may, within a two-month period commencing
on the expiration of such four-month period, require the holders of the remaining shares to transfer such shares to the offeror on the
terms of the offer. An objection can be made to the Grand Court of the Cayman Islands but this is unlikely to succeed in the case of an
offer which has been so approved unless there is evidence of fraud, bad faith or collusion.
If an arrangement and reconstruction is thus approved,
or if a tender offer is made and accepted, a dissenting shareholder would have no rights comparable to appraisal rights, which would otherwise
ordinarily be available to dissenting shareholders of Delaware corporations, providing rights to receive payment in cash for the judicially
determined value of the shares.
Shareholders’ Suits. In principle,
we will normally be the proper plaintiff to sue for a wrong done to us as a company, and as a general rule a derivative action may not
be brought by a minority shareholder. However, based on English authorities, which would in all likelihood be of persuasive authority
in the Cayman Islands, the Cayman Islands court can be expected to follow and apply the common law principles (namely the rule in Foss
v. Harbottle and the exceptions thereto) which permit a minority shareholder to commence a class action against or derivative actions
in the name of the company to challenge actions where:
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a company acts or proposes to act illegally or ultra vires;
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the act complained of, although not ultra vires, could only be effected duly if authorized by more than
a simple majority vote that has not been obtained; and
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those who control the company are perpetrating a “fraud
on the minority.”
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Indemnification of Directors and Executive Officers
and Limitation of Liability. Cayman Islands law does not limit the extent to which a company’s memorandum and articles of
association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman
Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing
a crime. Our Amended and Restated Memorandum and Articles of Association provides that we shall indemnify our officers and directors for
the time being and our liquidator or trustees (if any) for the time being acting in relation to any of the affairs of our company and
each of them, and each of their heirs, executors and administrators, shall be indemnified and secured harmless out of the assets and profits
of our company from and against all actions, costs, charges, losses, damages and expenses which they or any of them, their or any of their
heirs, executors or administrators, shall or may incur or sustain by or by reason of any act done, concurred in or omitted in or about
the execution of their duty, or supposed duty, in their respective offices or trusts; and none of them shall be answerable for the acts,
receipts, neglects or defaults of the other or others of them or for joining in any receipts for the sake of conformity, or for any bankers
or other persons with whom any moneys or effects belonging to our company shall or may be lodged or deposited for safe custody, or for
insufficiency or deficiency of any security upon which any moneys of or belonging to our company shall be placed out on or invested, or
for any other loss, misfortune or damage which may happen in the execution of their respective offices or trusts, or in relation thereto,
provided that the indemnity shall not extend to any matter in respect of any fraud or dishonesty which may attach to any of said persons.
This standard of conduct is generally the same as permitted under the Delaware General Corporation Law for a Delaware corporation.
In addition, we have entered into indemnification agreements
with our directors and executive officers that provide such persons with additional indemnification beyond that provided in our Amended
and Restated Memorandum and Articles of Association.
Insofar as indemnification for liabilities arising under
the Securities Act may be permitted to our directors, officers, or persons controlling us under the foregoing provisions, we have been
informed that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore
unenforceable.
Directors’ Fiduciary Duties. Under
Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders. This duty has
two components: the duty of care and the duty of loyalty. The duty of care requires that a director act in good faith, with the care that
an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director must inform himself of, and disclose
to shareholders, all material information reasonably available regarding a significant transaction. The duty of loyalty requires that
a director acts in a manner he reasonably believes to be in the best interests of the corporation. He must not use his corporate position
for personal gain or advantage. This duty prohibits self- dealing by a director and mandates that the best interest of the corporation
and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder and not shared by the
shareholders generally. In general, actions of a director are presumed to have been made on an informed basis, in good faith and in the
honest belief that the action taken was in the best interests of the corporation. However, this presumption may be rebutted by evidence
of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by a director, the director must
prove the procedural fairness of the transaction, and that the transaction was of fair value to the corporation.
As a matter of Cayman Islands law, a director of a Cayman
Islands company is in the position of a fiduciary with respect to the company and therefore it is considered that he owes the following
duties to the company—a duty to act bona fide in the best interests of the company, a duty not to make a profit based on his position
as director (unless the company permits him to do so), a duty not to put himself in a position where the interests of the company conflict
with his personal interest or his duty to a third party, and a duty to exercise powers for the purpose for which such powers were intended.
A director of a Cayman Islands company owes to the company a duty to act with skill and care. It was previously considered that a director
need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge
and experience. However, English and Commonwealth courts have moved towards an objective standard with regard to the required skill and
care and these authorities are likely to be followed in the Cayman Islands.
Shareholder Action by Written Consent. Under
the Delaware General Corporation Law, a corporation may eliminate the right of shareholders to act by written consent by amendment to
its certificate of incorporation. The Companies Act provides that the shareholders may approve corporate matters by way of a unanimous
written resolution signed by or on behalf of each shareholder who would have been entitled to vote on such matter at a general meeting
without a meeting being held. Our Amended and Restated Memorandum and Articles of Association provides that any action required or permitted
to be taken at any annual or extraordinary general meetings of the Company may be taken only upon the vote of the shareholders at an annual
or extraordinary general meeting duly noticed and convened in accordance with our Amended and Restated Memorandum and Articles of Association
and may not be taken by written resolution of shareholders without a meeting.
Shareholder Proposals. Under the Delaware
General Corporation Law, a shareholder has the right to put any proposal before the annual meeting of shareholders, provided it complies
with the notice provisions in the governing documents. A special meeting may be called by the board of directors or any other person authorized
to do so in the governing documents, but shareholders may be precluded from calling special meetings.
The Companies Act provides shareholders with only limited
rights to requisition a general meeting, and does not provide shareholders with any right to put any proposal before a general meeting.
However, these rights may be provided in a company’s articles of association. Our Amended and Restated Memorandum and Articles of
Association allows our shareholders holding in aggregate not less than one-third of all votes attaching to the issued and outstanding
shares of our company entitled to vote at general meetings to requisition an extraordinary general meeting of our shareholders, in which
case our board is obliged to convene an extraordinary general meeting and to put the resolutions so requisitioned to a vote at such meeting.
Other than this right to requisition a shareholders’ meeting, our Amended and Restated Memorandum and Articles of Association does
not provide our shareholders with any other right to put proposals before annual general meetings or extraordinary general meetings not
called by such shareholders. As an exempted Cayman Islands company, we are not obliged by law to call shareholders’ annual general
meetings.
Cumulative Voting. Under the Delaware General
Corporation Law, cumulative voting for elections of directors is not permitted unless the corporation’s certificate of incorporation
specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders on a board of directors
since it permits the minority shareholder to cast all the votes to which the shareholder is entitled on a single director, which increases
the shareholder’s voting power with respect to electing such director. There are no prohibitions in relation to cumulative voting
under the laws of the Cayman Islands but our Amended and Restated Memorandum and Articles of Association does not provide for cumulative
voting. As a result, our shareholders are not afforded any less protections or rights on this issue than shareholders of a Delaware corporation.
Removal of Directors. Under the Delaware General
Corporation Law, a director of a corporation with a classified board may be removed only for cause with the approval of a majority of
the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under our Amended and Restated Memorandum
and Articles of Association, directors may be removed with or without cause, by an ordinary resolution of our shareholders. A director
shall hold office until the expiration of his or her term or his or her successor shall have been elected and qualified, or until his
or her office is otherwise vacated. In addition, a director’s office shall be vacated if the director (i) becomes bankrupt or has
a receiving order made against him or suspends payment or compounds with his creditors; (ii) is found to be or becomes of unsound mind
or dies; (iii) resigns his office by notice in writing to the company or tendered at a meeting of the board of directors; (iv) without
special leave of absence from our board of directors, is absent from six consecutive meetings of the board and the board resolves that
his office be vacated; (v) is prohibited by law from being a director; or (vi) is removed from office pursuant to any other provisions
of our Amended and Restated Memorandum and Articles of Association.
Transactions with Interested Shareholders.
The Delaware General Corporation Law contains a business combination statute applicable to Delaware corporations whereby, unless the corporation
has specifically elected not to be governed by such statute by amendment to its certificate of incorporation, it is prohibited from engaging
in certain business combinations with an “interested shareholder” for three years following the date that such person becomes
an interested shareholder. An interested shareholder generally is a person or a group who or which owns or owned 15% or more of the target’s
outstanding voting share within the past three years. This has the effect of limiting the ability of a potential acquirer to make a two-tiered
bid for the target in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to
the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination
or the transaction which resulted in the person becoming an interested shareholder. This encourages any potential acquirer of a Delaware
corporation to negotiate the terms of any acquisition transaction with the target’s board of directors.
Cayman Islands law has no comparable statute. As a result,
we cannot avail ourselves of the types of protections afforded by the Delaware business combination statute. However, although Cayman
Islands law does not regulate transactions between a company and its significant shareholders, the directors of the Company are required
to comply with fiduciary duties which they owe to the Company under Cayman Islands laws, including the duty to ensure that, in their opinion,
any such transactions must be entered into bona fide in the best interests of the company, and are entered into for a proper corporate
purpose and not with the effect of constituting a fraud on the minority shareholders.
Dissolution; Winding up. Under the Delaware
General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution must be approved by shareholders
holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors may it be approved
by a simple majority of the corporation’s outstanding shares. Delaware law allows a Delaware corporation to include in its certificate
of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board.
Under Cayman Islands law, a company may be wound up by
either an order of the courts of the Cayman Islands or by a special resolution of its members or, if the company is unable to pay its
debts as they fall due, by an ordinary resolution of its members. The court has authority to order winding up in a number of specified
circumstances including where it is, in the opinion of the court, just and equitable to do so. Under the Companies Act and our Amended
and Restated Memorandum and Articles of Association, our company may be dissolved, liquidated or wound up by a special resolution of our
shareholders.
Variation of Rights of Shares. Under the
Delaware General Corporation Law, a corporation may vary the rights of a class of shares with the approval of a majority of the outstanding
shares of such class, unless the certificate of incorporation provides otherwise. Under Cayman Islands law and our amended and restated
articles of association, if our share capital is divided into more than one class of shares, we may vary the rights attached to any class
with the written consent of the holders of not less than two-thirds of the issued shares of that class or with the sanction of a resolution
passed at a separate meeting of the holders of the shares of that class by the holders of two-thirds of the issued shares of that class.
Amendment of Governing Documents. Under
the Delaware General Corporation Law, a corporation’s governing documents may be amended with the approval of a majority of the
outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under the Companies Act and our Amended
and Restated Memorandum and Articles of Association, our Amended and Restated Memorandum and Articles of Association may only be amended
by a special resolution of our shareholders.
Rights of Nonresident or Foreign Shareholders.
There are no limitations imposed by our Amended and Restated Memorandum and Articles of Association on the rights of nonresident or foreign
shareholders to hold or exercise voting rights on our shares. In addition, there are no provisions in our Amended and Restated Memorandum
and Articles of Association governing the ownership threshold above which shareholder ownership must be disclosed.
Anti-money Laundering—Cayman Islands
In order to comply with legislation or regulations aimed
at the prevention of money laundering, we may be required to adopt and maintain anti-money laundering procedures and may require subscribers
to provide evidence to verify their identity. Where permitted, and subject to certain conditions, we may also delegate the maintenance
of our anti-money laundering procedures (including the acquisition of due diligence information) to a suitable person.
We reserve the right to request such information as is
necessary to verify the identity of a subscriber. In the event of delay or failure on the part of the subscriber in producing any information
required for verification purposes, we may refuse to accept the application, in which case any funds received will be returned without
interest to the account from which they were originally debited.
We also reserve the right to refuse to make any redemption
payment to a shareholder if our directors or officers suspect or are advised that the payment of redemption proceeds to such shareholder
might result in a breach of applicable anti-money laundering or other laws or regulations by any person in any relevant jurisdiction,
or if such refusal is considered necessary or appropriate to ensure our compliance with any such laws or regulations in any applicable
jurisdiction.
If any person resident in the Cayman Islands knows or
suspects or has reason for knowing or suspecting that another person is engaged in criminal conduct or is involved with terrorism or terrorist
property and the information for that knowledge or suspicion came to their attention in the course of their business in the regulated
sector, or other trade, profession, business or employment, the person will be required to report such knowledge or suspicion to (i) a
nominated officer (appointed in accordance with the Proceeds of Crime Act (Revised) of the Cayman Islands) or the Financial Reporting
Authority of the Cayman Islands, pursuant to the Proceeds of Crime Act (Revised), if the disclosure relates to criminal conduct or money
laundering or (ii) to a police constable or a nominated officer (pursuant to the Terrorism Act (Revised) of the Cayman Islands) or the
Financial Reporting Authority, pursuant to the Terrorism Act (Revised), if the disclosure relates to involvement with terrorism or terrorist
financing and terrorist property. Such a report shall not be treated as a breach of confidence or of any restriction upon the disclosure
of information imposed by any enactment or otherwise.
Data Protection in the Cayman Islands—Privacy Notice
This privacy notice explains the manner in which we collect,
process, and maintain personal data about investors of the Company pursuant to the Data Protection Act (Revised) of the Cayman Islands,
as amended from time to time and any regulations, codes of practice, or orders promulgated pursuant thereto (the “DPA”).
We are committed to processing personal data in accordance
with the DPA. In our use of personal data, we will be characterized under the DPA as a “data controller,” whilst certain of
our service providers, affiliates, and delegates may act as “data processors” under the DPA. These service providers may process
personal information for their own lawful purposes in connection with services provided to us.
By virtue of your investment in the Company, we and certain
of our service providers may collect, record, store, transfer, and otherwise process personal data by which individuals may be directly
or indirectly identified.
Your personal data will be processed fairly and for lawful
purposes, including (a) where the processing is necessary for us to perform a contract to which you are a party or for taking pre-contractual
steps at your request, (b) where the processing is necessary for compliance with any legal, tax, or regulatory obligation to which we
are subject (such as compliance with anti-money laundering requirements, sanctions screening, maintaining statutory registers, and compliance
with statutory information sharing requirements), or (c) where the processing is for the purposes of legitimate interests pursued by us
or by a service provider to whom the data are disclosed. As a data controller, we will only use your personal data for the purposes for
which we collected it. If we need to use your personal data for an unrelated purpose, we will contact you.
We anticipate that we will share your personal data with
our service providers for the purposes set out in this privacy notice. We may also share relevant personal data where it is lawful to
do so and necessary to comply with our contractual obligations or your instructions or where it is necessary or desirable to do so in
connection with any regulatory reporting obligations. In exceptional circumstances, we will share your personal data with regulatory,
prosecuting, and other governmental agencies or departments, and parties to litigation (whether pending or threatened), in any country
or territory including to any other person where we have a public or legal duty to do so (e.g. to assist with detecting and preventing
fraud, tax evasion, and financial crime or compliance with a court order).
Your personal data shall not be held by the Company for
longer than necessary with regard to the purposes of the data processing.
We will not sell your personal data. Any transfer of
personal data outside of the Cayman Islands shall be in accordance with the requirements of the DPA. Where necessary, we will ensure that
separate and appropriate legal agreements are put in place with the recipient of that data.
We will only transfer personal data in accordance with the
requirements of the DPA, and will apply appropriate technical and organizational information security measures designed to protect against
unauthorized or unlawful processing of the personal data and against the accidental loss, destruction, or damage to the personal data.
If you are a natural person, this will affect you directly.
If you are a corporate investor (including, for these purposes, legal arrangements such as trusts or exempted limited partnerships) that
provides us with personal data on individuals connected to you for any reason in relation to your investment into the Company, this will
be relevant for those individuals and you should inform such individuals of the content.
You have certain rights under the DPA, including (a) the
right to be informed as to how we collect and use your personal data (and this privacy notice fulfils our obligation in this respect),
(b) the right to obtain a copy of your personal data, (c) the right to require us to stop direct marketing, (d) the right to have inaccurate
or incomplete personal data corrected, (e) the right to withdraw your consent and require us to stop processing or restrict the processing,
or not begin the processing of your personal data, (f) the right to be notified of a data breach (unless the breach is unlikely to be
prejudicial), (g) the right to obtain information as to any countries or territories outside the Cayman Islands to which we, whether directly
or indirectly, transfer, intend to transfer, or wish to transfer your personal data, general measures we take to ensure the security of
personal data, and any information available to us as to the source of your personal data, (h) the right to complain to the Office of
the Ombudsman of the Cayman Islands, and (i) the right to require us to delete your personal data in some limited circumstances.
DESCRIPTION OF DEBT SECURITIES
General
We may issue debt securities which may or may not be
converted into our ordinary shares or preferred shares. We may issue the debt securities independently or together with any underlying
securities, and debt securities may be attached or separate from the underlying securities. In connection with the issuance of any debt
securities, we do not intend to issue them pursuant to a trust indenture upon reliance of Section 304(a)(8) of the Trust Indenture Act
and Rule 4a-1 promulgated thereunder.
The following description is a summary of selected provisions
relating to the debt securities that we may issue. The summary is not complete. When debt securities are offered in the future, a prospectus
supplement, information incorporated by reference, or a free writing prospectus, as applicable, will explain the particular terms of those
securities and the extent to which these general provisions may apply. The specific terms of the debt securities as described in a prospectus
supplement, information incorporated by reference, or free writing prospectus will supplement and, if applicable, may modify or replace
the general terms described in this section.
This summary and any description of debt securities in
the applicable prospectus supplement, information incorporated by reference, or free writing prospectus is subject to and is qualified
in its entirety by reference to all the provisions of any specific debt securities document or agreement. We will file each of these documents,
as applicable, with the SEC and incorporate them by reference as an exhibit to the registration statement of which this prospectus is
a part on or before the time we issue a series of warrants. See “Where You Can Find Additional Information” and “Incorporation
of Documents by Reference” below for information on how to obtain a copy of a debt securities document when it is filed.
When we refer to a series of debt securities, we mean
all debt securities issued as part of the same series under the applicable indenture.
Terms
The applicable prospectus supplement, information incorporated
by reference, or free writing prospectus, may describe the terms of any debt securities that we may offer, including, but not limited
to, the following:
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the title of the debt securities;
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the total amount of the debt securities;
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the amount or amounts of the debt securities will be issued and
interest rate;
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the conversion price at which the debt securities may be converted;
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the date on which the right to convert the debt securities will commence and the date on which the right
will expire;
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if applicable, the minimum or maximum amount of debt securities that may be converted at any one time;
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if applicable, a discussion of material federal income tax consideration;
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if applicable, the terms of the payoff of the debt securities;
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the identity of the indenture agent, if any;
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the procedures and conditions relating to the conversion of the
debt securities; and
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any other terms of the debt securities, including terms, procedure and limitation relating to the exchange
or conversion of the debt securities.
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Form, Exchange, and Transfer
We may issue the debt securities in registered form or
bearer form. Debt securities issued in registered form, i.e., book-entry form, will be represented by a global security registered in
the name of a depository, which will be the holder of all the debt securities represented by the global security. Those investors who
own beneficial interests in global debt securities will do so through participants in the depository’s system, and the rights of
these indirect owners will be governed solely by the applicable procedures of the depository and its participants. In addition, we may
issue debt securities in non-global form, i.e., bearer form. If any debt securities are issued in non-global form, debt securities certificates
may be exchanged for new debt securities certificates of different denominations, and holders may exchange, transfer, or convert their
debt securities at the debt securities agent’s office or any other office indicated in the applicable prospectus supplement, information
incorporated by reference or free writing prospectus.
Prior to the conversion of their debt securities, holders
of debt securities convertible for ordinary shares or preferred shares will not have any rights of holders of ordinary shares or preferred
shares, and will not be entitled to dividend payments, if any, or voting rights of the ordinary shares or preferred shares.
Conversion of Debt Securities
A debt security may entitle the holder to purchase, in
exchange for the extinguishment of debt, an amount of securities at a conversion price that will be stated in the debt security. Debt
securities may be converted at any time up to the close of business on the expiration date set forth in the terms of such debt security.
After the close of business on the expiration date, debt securities not exercised will be paid in accordance with their terms.
Debt securities may be converted as set forth in the applicable
offering material. Upon receipt of a notice of conversion properly completed and duly executed at the corporate trust office of the indenture
agent, if any, or to us, we will forward, as soon as practicable, the securities purchasable upon such exercise. If less than all of the
debt security represented by such security is converted, a new debt security will be issued for the remaining debt security.
DESCRIPTION OF WARRANTS
General
We may issue warrants to purchase our securities. We may
issue the warrants independently or together with any underlying securities, and the warrants may be attached or separate from the underlying
securities. We may also issue a series of warrants under a separate warrant agreement to be entered into between us and a warrant agent.
The warrant agent will act solely as our agent in connection with the warrants of such series and will not assume any obligation or relationship
of agency for or with holders or beneficial owners of warrants.
The following description is a summary of selected provisions
relating to the warrants that we may issue. The summary is not complete. When warrants are offered in the future, a prospectus supplement,
information incorporated by reference, or a free writing prospectus, as applicable, will explain the particular terms of those securities
and the extent to which these general provisions may apply. The specific terms of the warrants as described in a prospectus supplement,
information incorporated by reference, or free writing prospectus will supplement and, if applicable, may modify or replace the general
terms described in this section.
This summary and any description of warrants in the applicable
prospectus supplement, information incorporated by reference, or free writing prospectus is subject to and is qualified in its entirety
by reference to all the provisions of any specific warrant document or agreement, if applicable. We will file each of these documents,
as applicable, with the SEC and incorporate them by reference as an exhibit to the registration statement of which this prospectus is
a part on or before the time we issue a series of warrants. See “Where You Can Find Additional Information” and “Incorporation
of Documents by Reference” below for information on how to obtain a copy of a warrant document when it is filed.
When we refer to a series of warrants, we mean all warrants
issued as part of the same series under the applicable warrant agreement.
Terms
The applicable prospectus supplement, information incorporated
by reference, or free writing prospectus, may describe the terms of any warrants that we may offer, including, but not limited to, the
following:
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the title of the warrants;
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the total number of warrants;
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the price or prices at which the warrants will be issued;
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the price or prices at which the warrants may be exercised;
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the currency or currencies that investors may use to pay for
the warrants;
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the date on which the right to exercise the warrants will commence and the date on which the right will
expire;
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whether the warrants will be issued in registered form or bearer
form;
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information with respect to book-entry procedures, if any;
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if applicable, the minimum or maximum amount of warrants that
may be exercised at any one time;
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if applicable, the designation and terms of the underlying securities with which the warrants are issued
and the number of warrants issued with each underlying security;
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if applicable, the date on and after which the warrants and the related underlying securities will be
separately transferable;
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if applicable, a discussion of material federal income tax considerations;
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if applicable, the terms of redemption of the warrants;
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the identity of the warrant agent, if any;
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the procedures and conditions relating to the exercise of the
warrants; and
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any other terms of the warrants, including terms, procedures, and limitations relating to the exchange
and exercise of the warrants.
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Warrant Agreement
We may issue the warrants in one or more series under one
or more warrant agreements, each to be entered into between us and a bank, trust company, or other financial institution as warrant agent.
We may add, replace, or terminate warrant agents from time to time. We may also choose to act as our own warrant agent or may choose one
of our subsidiaries to do so.
The warrant agent under a warrant agreement will act solely
as our agent in connection with the warrants issued under that agreement. Any holder of warrants may, without the consent of any other
person, enforce by appropriate legal action, on its own behalf, its right to exercise those warrants in accordance with their terms.
Form, Exchange, and Transfer
We may issue the warrants in registered form or bearer
form. Warrants issued in registered form, i.e., book-entry form, will be represented by a global security registered in the name of a
depository, which will be the holder of all the warrants represented by the global security. Those investors who own beneficial interests
in a global warrant will do so through participants in the depository’s system, and the rights of these indirect owners will be
governed solely by the applicable procedures of the depository and its participants. In addition, we may issue warrants in non-global
form, i.e., bearer form. If any warrants are issued in non-global form, warrant certificates may be exchanged for new warrant certificates
of different denominations, and holders may exchange, transfer, or exercise their warrants at the warrant agent’s office or any
other office indicated in the applicable prospectus supplement, information incorporated by reference, or free writing prospectus.
Prior to the exercise of their warrants, holders of warrants
exercisable for ordinary shares or preferred shares will not have any rights of holders of ordinary shares or preferred shares and will
not be entitled to dividend payments, if any, or voting rights of the ordinary shares or preferred shares.
Exercise of Warrants
A warrant will entitle the holder to purchase for cash
an amount of securities at an exercise price that will be stated in, or that will be determinable as described in, the applicable prospectus
supplement, information incorporated by reference, or free writing prospectus. Warrants may be exercised at any time up to the close of
business on the expiration date set forth in the applicable offering material. After the close of business on the expiration date, unexercised
warrants will become void. Warrants may be redeemed as set forth in the applicable offering material.
Warrants may be exercised as set forth in the applicable
offering material. Upon receipt of payment and the warrant certificate properly completed and duly executed at the corporate trust office
of the warrant agent or any other office indicated in the applicable offering material, we will forward, as soon as practicable, the securities
purchasable upon such exercise. If less than all of the warrants represented by such warrant certificate are exercised, a new warrant
certificate will be issued for the remaining warrants.
DESCRIPTION OF RIGHTS
We may issue rights to purchase our securities. The rights
may or may not be transferable by the persons purchasing or receiving the rights. In connection with any rights offering, we may enter
into a standby underwriting or other arrangement with one or more underwriters or other persons pursuant to which such underwriters or
other persons would purchase any offered securities remaining unsubscribed for after such rights offering. Each series of rights will
be issued under a separate rights agent agreement to be entered into between us and one or more banks, trust companies, or other financial
institutions, as rights agent, that we will name in the applicable prospectus supplement. The rights agent will act solely as our agent
in connection with the rights and will not assume any obligation or relationship of agency or trust for or with any holders of rights
certificates or beneficial owners of rights.
The prospectus supplement relating to any rights that we
offer will include specific terms relating to the offering, including, among other matters:
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the date of determining the security holders entitled to the
rights distribution;
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the aggregate number of rights issued and the aggregate amount of securities purchasable upon exercise
of the rights;
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the conditions to completion of the rights offering;
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the date on which the right to exercise the rights will commence and the date on which the rights will
expire; and
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any applicable federal income tax considerations.
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Each right would entitle the holder of the rights to purchase
for cash the principal amount of securities at the exercise price set forth in the applicable prospectus supplement. Rights may be exercised
at any time up to the close of business on the expiration date for the rights provided in the applicable prospectus supplement. After
the close of business on the expiration date, all unexercised rights will become void.
If less than all of the rights issued in any rights offering
are exercised, we may offer any unsubscribed securities directly to persons other than our security holders, to or through agents, underwriters,
or dealers, or through a combination of such methods, including pursuant to standby arrangements, as described in the applicable prospectus
supplement.
DESCRIPTION OF UNITS
We may issue units composed of any combination of our securities.
We will issue each unit so that the holder of the unit is also the holder of each security included in the unit. As a result, the holder
of a unit will have the rights and obligations of a holder of each included security. The unit agreement under which a unit is issued
may provide that the securities included in the unit may not be held or transferred separately, at any time or at any time before a specified
date.
The following description is a summary of selected provisions relating
to units that we may offer. The summary is not complete. When units are offered in the future, a prospectus supplement, information incorporated
by reference, or a free writing prospectus, as applicable, will explain the particular terms of those securities and the extent to which
these general provisions may apply. The specific terms of the units as described in a prospectus supplement, information incorporated
by reference, or free writing prospectus will supplement and, if applicable, may modify or replace the general terms described in this
section.
This summary and any description of units in
the applicable prospectus supplement, information incorporated by reference, or free writing prospectus is subject to and is qualified
in its entirety by reference to the unit agreement, and collateral arrangements, if applicable. We will file each of these documents,
as applicable, with the SEC and incorporate them by reference as an exhibit to the registration statement of which this prospectus is
a part on or before the time we issue a series of units. See “Where You Can Find Additional Information” and “Incorporation
of Documents by Reference” below for information on how to obtain a copy of a document when it is filed.
The applicable prospectus supplement, information incorporated
by reference, or free writing prospectus may describe:
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The designation and terms of the units and of the securities comprising the units, including whether
and under what circumstances those securities may be held or transferred separately;
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Any provisions for the issuance, payment, settlement, transfer, or exchange of the units or of the
securities composing the units;
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Whether the units will be issued in fully registered or global
form; and
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Any other terms of the units.
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The applicable provisions described in this section,
as well as those described under “Description of Share Capital,” “Description of Debt Securities,” “Description
of Warrants,” and “Description of Rights” above, will apply to each unit and to each security included in each unit,
respectively.
PLAN OF DISTRIBUTION
We may sell the securities offered by this prospectus
from time to time in one or more transactions, including, without limitation:
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to or through underwriters;
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through broker-dealers (acting as agent or principal);
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directly by us to purchasers (including our affiliates and shareholders), through a specific bidding
or auction process, a rights offering, or other method;
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through a combination of any such methods of sale; or
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through any other methods described in a prospectus supplement.
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The distribution of securities may be effected, from time to
time, in one or more transactions, including:
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block transactions (which may involve crosses) and transactions on Nasdaq or any other organized market
where the securities may be traded;
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purchases by a broker-dealer as principal and resale by the broker-dealer for its own account pursuant
to a prospectus supplement;
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ordinary brokerage transactions and transactions in which a broker-dealer
solicits purchasers;
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sales “at the market” to or through a market maker or into an existing trading market, on
an exchange or otherwise; and
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sales in other ways not involving market makers or established trading markets, including direct sales
to purchasers.
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The securities may be sold at a fixed price or prices,
which may be changed, or at market prices prevailing at the time of sale, at prices relating to the prevailing market prices or at negotiated
prices. The consideration may be cash, extinguishment of debt, or another form negotiated by the parties. Agents, underwriters, or broker-dealers
may be paid compensation for offering and selling the securities. That compensation may be in the form of discounts, concessions, or commissions
to be received from us or from the purchasers of the securities. Dealers and agents participating in the distribution of the securities
may be deemed to be underwriters, and compensation received by them on resale of the securities may be deemed to be underwriting discounts
and commissions under the Securities Act. If such dealers or agents were deemed to be underwriters, they may be subject to statutory liabilities
under the Securities Act.
We may also make direct sales through subscription rights
distributed to our existing shareholders on a pro rata basis, which may or may not be transferable. In any distribution of subscription
rights to our shareholders, if all of the underlying securities are not subscribed for, we may then sell the unsubscribed securities directly
to third parties or may engage the services of one or more underwriters, dealers, or agents, including standby underwriters, to sell the
unsubscribed securities to third parties.
Some or all of the securities that we offer through this
prospectus may be new issues of securities with no established trading market. Any underwriters to whom we sell our securities for public
offering and sale may make a market in those securities, but they will not be obligated to do so and they may discontinue any market making
at any time without notice. Accordingly, we cannot assure you of the liquidity of, or continued trading markets for, any securities that
we offer.
Agents may, from time to time, solicit offers to purchase
the securities. If required, we will name in the applicable prospectus supplement, document incorporated by reference, or free writing
prospectus, as applicable, any agent involved in the offer or sale of the securities
and set forth any compensation payable to the agent. Unless otherwise indicated, any agent will be acting on a best efforts basis for
the period of its appointment. Any agent selling the securities covered by this prospectus may be deemed to be an underwriter of the securities.
If underwriters are used in an offering, securities
will be acquired by the underwriters for their own account and may be resold, from time to time, in one or more transactions,
including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale, or under
delayed delivery contracts or other contractual commitments. Securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or directly by one or more firms acting as underwriters. If an
underwriter or underwriters are used in the sale of securities, an underwriting agreement will be executed with the underwriter or
underwriters at the time an agreement for the sale is reached. The applicable prospectus supplement will set forth the managing
underwriter or underwriters, as well as any other underwriter or underwriters, with respect to a particular underwritten offering of
securities, and will set forth the terms of the transactions, including compensation of the underwriters and dealers and the public
offering price, if applicable. This prospectus, the applicable prospectus supplement and any applicable free writing prospectus will
be used by the underwriters to resell the securities.
If a dealer is used in the sale of the securities, we,
or an underwriter, will sell the securities to the dealer, as principal. The dealer may then resell the securities to the public at varying
prices to be determined by the dealer at the time of resale. To the extent required, we will set forth in the prospectus supplement, document
incorporated by reference, or free writing prospectus, as applicable, the name of the dealer and the terms of the transactions.
We may directly solicit offers to purchase the securities
and may make sales of securities directly to institutional investors or others. These persons may be deemed to be underwriters with respect
to any resale of the securities. To the extent required, the prospectus supplement, document incorporated by reference, or free writing
prospectus, as applicable, will describe the terms of any such sales, including the terms of any bidding or auction process, if used.
Agents, underwriters, and dealers may be entitled under
agreements which may be entered into with us to indemnification by us against specified liabilities, including liabilities incurred under
the Securities Act, or to contribution by us to payments they may be required to make in respect of such liabilities. If required, the
prospectus supplement, document incorporated by reference, or free writing prospectus, as applicable, will describe the terms and conditions
of such indemnification or contribution. Some of the agents, underwriters, or dealers, or their affiliates may be customers of, engage
in transactions with or perform services for us or our subsidiaries or affiliates in the ordinary course of business.
Under the securities laws of some states, the securities
offered by this prospectus may be sold in those states only through registered or licensed brokers or dealers.
Any person participating in the distribution of securities
registered under the registration statement that includes this prospectus will be subject to applicable provisions of the Exchange Act,
and the applicable SEC rules and regulations, including, among others, Regulation M, which may limit the timing of purchases and sales
of any of our securities by any such person. Furthermore, Regulation M may restrict the ability of any person engaged in the distribution
of our securities to engage in market-making activities with respect to our securities.
These restrictions may affect the marketability of our
securities and the ability of any person or entity to engage in market-making activities with respect to our securities.
Certain persons participating in an offering may engage
in over-allotment, stabilizing transactions, short-covering transactions, and penalty bids in accordance with Regulation M under the Exchange
Act that stabilize, maintain, or otherwise affect the price of the offered securities. If any such activities will occur, they will be
described in the applicable prospectus supplement.
To the extent required, this prospectus may be amended
or supplemented from time to time to describe a specific plan of distribution.
TAXATION
Material
income tax consequences relating to the purchase, ownership, and disposition of the securities offered by this prospectus are set forth
in “Item 10. Additional Information—10.E. Taxation” in our annual report on Form 20-F for the fiscal year ended December
31, 2020, which is incorporated herein by reference, as updated by our subsequent filings under the Exchange Act that are incorporated
by reference and, if applicable, in any accompanying prospectus supplement or relevant free writing prospectus.
EXPENSES
The
following table sets forth the aggregate expenses in connection with this offering, all of which will be paid by us. All amounts shown
are estimates, except for the SEC registration fee.
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SEC registration fee
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US$
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Financial Industry Regulatory Authority fees
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US$
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Legal fees and expenses
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US$
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*
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Accounting fees and expenses
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US$
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*
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Printing and postage expenses
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US$
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*
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Miscellaneous expenses
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US$
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*
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Total
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US$
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*
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*
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To
be provided by a prospectus supplement or as an exhibit to a report of foreign private issuer
on Form 6-K that is incorporated by reference into this registration statement. Estimated
solely for this item. Actual expenses may vary.
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MATERIAL
CONTRACTS
Our
material contracts are described in the documents incorporated by reference into this prospectus. See “Incorporation of Documents
by Reference” below.
MATERIAL
CHANGES
Except
as otherwise described in our annual report on Form 20-F for the fiscal year ended December 31, 2020, in our reports of foreign private
issuer on Form 6-K filed or submitted under the Exchange Act and incorporated by reference herein, and as disclosed in this prospectus
or the applicable prospectus supplement, no reportable material changes have occurred since December 31, 2020.
LEGAL
MATTERS
We
are being represented by Hunter Taubman Fischer & Li LLC with respect to certain legal matters of U.S. federal securities and New
York State law. The validity of the securities offered in this offering and certain other legal matters as to Cayman Islands law will
be passed upon for us by Conyers Dill & Pearman. Legal matters as to PRC law will be passed upon for us by Commerce & Finance
Law Offices. Hunter Taubman Fischer & Li LLC may rely upon Conyers Dill & Pearman with respect to matters governed by Cayman
Islands law and Commerce & Finance Law Offices with respect to matters governed by PRC law.
If
legal matters in connection with offerings made pursuant to this prospectus are passed upon by counsel to underwriters, dealers, or agents,
such counsel will be named in the applicable prospectus supplement relating to any such offering.
EXPERTS
The consolidated financial statements of Meten EdtechX
Education Group Ltd. (the “Company”) and the subsidiaries as of December 31, 2020 and the adjustments described in Note 1(b)
that were applied to restate the financial statements for the year ended December 31,2019 incorporated in this prospectus by reference
to the Annual Report on Form 20-F for the year ended December 31, 2020 have been so incorporated in reliance on the report of Audit Alliance
LLP, an independent registered public accounting firm, given the authority of said firm as experts in auditing and accounting.
The consolidated balance sheet of Meten International
Education Group (operating as Meten EdtechX Education Group Ltd. after the reverse recapitalization described in Note 1 to the financial
statements) and the subsidiaries, its variable interest entities and the subsidiaries of its variable interest entities as of December
31 2019, the related consolidated statements of comprehensive income (loss), changes in deficit, and cash flows for each of the year in
the two-year period ended December 31, 2019, and the related notes, before the effects of the retrospective adjustments related to the
reverse recapitalization discussed in Note 1 to the financial statements, have been incorporated by reference in this prospectus in reliance
upon the report of KPMG Huazhen LLP, an independent registered public accounting firm, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
We
have agreed to indemnify and hold KPMG Huazhen LLP harmless against and from any and all legal costs and expenses incurred by KPMG Huazhen
LLP in successful defense of any legal action or proceeding that arises as a result of KPMG Huazhen LLP’s consent to the inclusion
of its audit report on the past financial statements of Meten International Education Group, its subsidiaries, its variable interest
entities and the subsidiaries of its variable interest entities, before the effects of the retrospective adjustments related to the
reverse recapitalization discussed in Note 1 to the financial statements, incorporated by reference in this registration statement.
The
registered business address of Audit Alliance LLP is No.20 Maxwell Road, #11-09, Maxwell House, Singapore.
The
registered business address of KPMG Huazhen LLP is 15th Floor, China Resources Tower, 2666 Keyuan South Road, Nanshan District, Shenzhen,
China 518052.
INCORPORATION
OF DOCUMENTS BY REFERENCE
The
SEC allows us to “incorporate by reference” into this prospectus certain information that we file with the SEC. This means
that we can disclose important information to you by referring you to those documents. Any statement contained in a document incorporated
by reference in this prospectus shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement
contained herein, or in any subsequently filed document, which also is incorporated by reference herein, modifies or supersedes such
earlier statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute
a part of this prospectus.
We
hereby incorporate by reference into this prospectus the following documents:
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(1)
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our
annual report on Form 20-F for the fiscal year ended December 31, 2020, filed with the SEC on April 30, 2021;
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(2)
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the
description of our ordinary shares contained in our registration statements on Form 8-A, filed with the SEC on March 31, 2020 and May 26, 2020, respectively, and any amendment or report filed for the purpose of updating such description;
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(3)
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any
future annual reports on Form 20-F filed with the SEC after the date of this prospectus and prior to the termination of the offering
of the securities offered by this prospectus; and
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(4)
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any
future reports of foreign private issuer on Form 6-K that we furnish to the SEC after the date of this prospectus that are identified
in such reports as being incorporated by reference into the registration statement of which this prospectus forms a part.
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Our
annual report on Form 20-F for the fiscal year ended December 31, 2020 filed with the SEC on April 30, 2021 contains a description
of our business and audited consolidated financial statements with a report by our independent auditors. These statements were
prepared in accordance with U.S. GAAP.
Unless
expressly incorporated by reference, nothing in this prospectus shall be deemed to incorporate by reference information furnished to,
but not filed with, the SEC. Copies of all documents incorporated by reference in this prospectus, other than exhibits to those documents
unless such exhibits are specially incorporated by reference in this prospectus, will be provided at no cost to each person, including
any beneficial owner, who receives a copy of this prospectus on the written or oral request of that person made to:
METEN
EDTECHX EDUCATION GROUP LTD.
3rd
Floor, Tower A
Tagen
Knowledge & Innovation Center
2nd
Shenyun West Road, Nanshan District
Shenzhen,
Guangdong Province 518000
People’s
Republic of China
Tel:
+86 755 8294-5250
You
should rely only on the information that we incorporate by reference or provide in this prospectus. We have not authorized anyone to
provide you with different information. We are not making any offer to sell these securities in any jurisdiction where the offer or sale
is not permitted. You should not assume that the information contained or incorporated in this prospectus by reference is accurate as
of any date other than the date of the document containing the information.
WHERE
YOU CAN FIND ADDITIONAL INFORMATION
As
permitted by SEC rules, this prospectus omits certain information and exhibits that are included in the registration statement of which
this prospectus forms a part. Since this prospectus may not contain all of the information that you may find important, you should review
the full text of these documents. If we have filed a contract, agreement, or other document as an exhibit to the registration statement
of which this prospectus forms a part, you should read the exhibit for a more complete understanding of the document or matter involved.
Each statement in this prospectus, including statements incorporated by reference as discussed above, regarding a contract, agreement,
or other document is qualified in its entirety by reference to the actual document.
We
are subject to periodic reporting and other informational requirements of the Exchange Act as applicable to foreign private issuers.
Accordingly, we are required to file reports, including annual reports on Form 20-F, and other information with the SEC. All information
filed with the SEC can be inspected over the Internet at the SEC’s website at www.sec.gov and copied at the public reference facilities
maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You can request copies of these documents, upon payment of a duplicating
fee, by writing to the SEC.
As
a foreign private issuer, we are exempt under the Exchange Act from, among other things, the rules prescribing the furnishing and content
of proxy statements, and our executive officers, directors and principal shareholders are exempt from the reporting and short-swing profit
recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file
periodic or current reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are
registered under the Exchange Act.
ENFORCEABILITY
OF CIVIL LIABILITIES
We
were incorporated in the Cayman Islands, as an exempted company, in order to enjoy the following benefits:
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political
and economic stability;
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an
effective judicial system;
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a
favorable tax system;
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the absence of exchange control or currency restrictions; and
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the
availability of professional and support services.
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However,
certain disadvantages accompany incorporation in the Cayman Islands. These disadvantages include, but are not limited to, the following:
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the
Cayman Islands has a less developed body of securities laws as compared to the United States
and these securities laws provide significantly less protection to investors as compared
to the United States; and
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Cayman
Islands companies may not have standing to sue before the federal courts of the United States.
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Our
constitutional documents do not contain provisions requiring that disputes, including those arising under the securities laws of the
United States, between us, our officers, directors, and shareholders, be arbitrated.
All
of our operations are conducted outside the United States, and all of our assets are located outside the United States. A majority of
our directors and officers are nationals or residents of jurisdictions other than the United States and a substantial portion of their
assets are located outside the United States. As a result, it may be difficult for a shareholder to effect service of process within
the United States upon these persons, or to enforce against us or them judgments obtained in U.S. courts, including judgments predicated
upon the civil liability provisions of the securities laws of the United States or any state in the United States.
We
have appointed Puglisi & Associates as our agent upon whom process may be served in any action brought against us under the securities
laws of the United States.
Conyers
Dill & Pearman, our counsel as to Cayman Islands law, has advised us that there is uncertainty as to whether the courts of the Cayman
Islands, would:
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recognize
or enforce judgments of U.S. courts obtained against us or our directors or officers predicated
upon the civil liability provisions of the securities laws of the United States or any state
in the United States so far as the liabilities imposed by those provisions are penal in nature;
or
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entertain
original actions brought in each respective jurisdiction against us or our directors or officers
predicated upon the civil liability provisions of the securities laws of the United States
or any state in the United States.
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Our
counsel with respect to the laws of the Cayman Islands has advised us that it is uncertain whether the courts of the Cayman Islands will
allow shareholders of our company to originate actions in the Cayman Islands based upon securities laws of the United States. In addition,
there is uncertainty with regard to Cayman Islands law related to whether a judgment obtained from the U.S. courts under civil liability
provisions of U.S. securities laws will be determined by the courts of the Cayman Islands as penal or punitive in nature. If such a determination
is made, the courts of the Cayman Islands will not recognize or enforce the judgment against a Cayman Islands company, such as our company.
As the courts of the Cayman Islands have yet to rule on making such a determination in relation to judgments obtained from U.S. courts
under civil liability provisions of U.S. securities laws, it is uncertain whether such judgments would be enforceable in the Cayman Islands.
Our counsel has further advised us that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the
federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or
recognition of such judgments), a judgment obtained in such jurisdiction will be recognized and enforced in the courts of the Cayman
Islands at common law, without any reexamination of the merits of the underlying dispute, by an action commenced on the foreign judgment
debt in the Grand Court of the Cayman Islands, provided (a) such courts had proper jurisdiction over the parties subject to such judgment;
(b) such courts did not contravene the rules of natural justice of the Cayman Islands; (c) such judgment was not obtained by fraud; (d)
the enforcement of the judgment would not be contrary to the public policy of the Cayman Islands; (e) no new admissible evidence relevant
to the action is submitted prior to the rendering of the judgment by the courts of the Cayman Islands; and (f) there is due compliance
with the correct procedures under the laws of the Cayman Islands.
Commerce
& Finance Law Offices, our counsel as to PRC law, has advised us that there is uncertainty as to whether the courts of China, would:
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recognize
or enforce judgments of U.S. courts obtained against us or our directors or officers predicated
upon the civil liability provisions of the securities laws of the United States or any state
in the United States so far as the liabilities imposed by those provisions are penal in nature;
or
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entertain
original actions brought in each respective jurisdiction against us or our directors or officers
predicated upon the civil liability provisions of the securities laws of the United States
or any state in the United States.
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We
have been advised by our PRC legal counsel, that there is uncertainty as to whether the courts of the PRC would enforce judgments of
U.S. courts or Cayman courts obtained against us or these persons predicated upon the civil liability provisions of the U.S. federal
and state securities laws or Cayman Island laws. Commerce & Finance Law Offices has further advised us that the recognition and enforcement
of foreign judgments are provided for under PRC Civil Procedures Law. PRC courts may recognize and enforce foreign judgments in accordance
with the requirements of PRC Civil Procedures Law based either on treaties between China and the country where the judgment is made or
on reciprocity between jurisdictions. China does not have any treaties or other form of reciprocity with the United States or the Cayman
Islands that provide for the reciprocal recognition and enforcement of foreign judgments. In addition, according to the PRC Civil Procedures
Law, courts in the PRC will not enforce a foreign judgment against us or our directors and officers if they decide that the judgment
violates the basic principles of PRC law or national sovereignty, security or public interest. As a result, it is uncertain whether and
on what basis a PRC court would enforce a judgment rendered by a court in the United States or in the Cayman Islands.
Ordinary Shares
METEN EDTECHX EDUCATION GROUP LTD.
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Sole Book-Running Manager
Aegis
Capital Corp.
May 24, 2021
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