Relationship with Our Controlling Shareholders

THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS

OUR CONTROLLING SHAREHOLDERS

As at the Latest Practicable Date, Mr. Zhou, through ZZB Investment Ltd., ZZB Capital Ltd. and Angshan Ltd., controlled the exercise of 97.0% of the voting power at the general meetings of our Company. Immediately after the completion of the [REDACTED] and the [REDACTED] (assuming no exercise of the [REDACTED] and the options granted under the [REDACTED] Share Option Scheme), Mr. Zhou, through ZZB Investment Ltd., ZZB Capital Ltd. and Angshan Ltd., will control the exercise of approximately [REDACTED]% of the voting power at the general meetings of our Company. ZZB Investment Ltd. is controlled by Mr. Zhou as it is owned as to (i) 99.0% by Angshan Ltd., which is wholly-owned by Zedra Holdings (Cayman) Limited, the trustee of Zhou Family Trust, and (ii) 1.0% by ZZB Capital Ltd., which is wholly owned by Mr. Zhou. Accordingly, Mr. Zhou, ZZB Investment Ltd., Angshan Ltd. and ZZB Capital Ltd. will continue to be the controlling shareholders of our Company upon the [REDACTED].

BUSINESS DELINEATION AND COMPETITION

Currently, we are primarily engaged in the provision of private higher education and high school education with a focus on mass media communications.

As confirmed by Mr. Zhou, as at the Latest Practicable Date, other than the interest in our Group, Mr. Zhou had equity or school sponsor interests in entities that engage in primary school education, junior high school education, high school education, after-school tutoring services, sales of music teaching materials and instruments as well as research and development of education software, and is also interested in certain entities without substantial operation (collectively, the “Excluded Business”).

As advised by our PRC Legal Advisers, since (i) schools, such as Guangshui Scholars School (廣水書生學校) and Dawu Tumyu Experimental School (大悟天有實驗學校), offering compulsory education of primary school education and junior high school education, are not allowed to be registered as “for-profit” private schools, and (ii) private schools that have selected to register as “non-profit” private schools, such as Zhongxiang Tumyu Experimental School (鐘祥天有實驗學校), in accordance with the relevant registration procedures may not be re-registered as “for-profit” private schools, the owners of such “non-profit” private schools are not entitled under PRC laws, rules and regulations, to the right of dividends or profits, cash flow or residue assets upon liquidation. Our Directors consider that, as we are not able to share the profits of, or receive dividends from, “non-profit” private schools, the injection of such schools into our Group is not commensurate with the for-profit nature of our Company to maximise shareholder value, particularly as a company to be [REDACTED] on the Stock Exchange. See “Regulatory Overview – Regulations relating to private education” for details. Taking into account the advice of our PRC Legal Advisers, our Directors are of the view that including “non-profit” private schools as part of our Group is not in the best interests of our Company and our Shareholders as a whole in the long term. As a result, we decided not to include “non-profit” private schools in our Group.

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Accordingly, to facilitate the [REDACTED] and to expedite the implementation of our strategic direction and development plan in the interests of our Company and our Shareholders as a whole, the Excluded Business will not form part of our Group after the [REDACTED]. As confirmed by our Controlling Shareholders and to the best of our Directors’ knowledge, details of the Excluded Businesses with substantial operation are summarised as follows:

Zhongxiang 100% school primary school RMB16.3 Netprofitof 86 1,466 Tumyu sponsor section and million RMB1.5 Experimental interest junior high million School (鐘祥 held by school section of 天有實驗學 Wuhan Zhongxiang 校)(1) Tumyu Tumyu (which is Experimental held as to School providing 95% by compulsory Mr. Zhou) education to students in Zhongxiang, Hubei Province

high school RMB3.5 Net loss of 24 245 section of million RMB1.3 Zhongxiang million Tumyu Experimental School providing high school education services to students in Zhongxiang, Hubei Province

Guangshui 100% school consists of a RMB11.9 Netprofitof 76 1,318 Scholars sponsor primary school million RMB3.7 School (廣水 interest held section and a million 書生學校)(1) by Beijing junior high Tumyu school section, (which is providing held as to compulsory 95% by education Mr. Zhou) services to students

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Equity/ school sponsor Revenue interests for the Net profit/ Approximate Approximate ultimately year loss for the number of number of held by our ended year ended teachers as students as Controlling Business 31 August 31 August at 31 March at 31 March Name of entity Shareholders description 2020 2020 2021 2021 Dawu Tumyu 100% school consists of a RMB32.2 Netprofitof 123 2,478 Experimental sponsor primary school million RMB 11.0 School (大悟 interest held section and a million 天有實驗學 by Wuhan junior high 校)(1) Tumyu school section (which is providing held as to compulsory 95% by education Mr. Zhou) services to students

Lesi Moer 30% equity sales of music No access No access to N/A N/A (Beijing) interest held teaching to such such Education & by Beijing materials and information(2)information(2) Technology Tumyu instruments Co., Ltd. (樂 Technology 斯摩爾（北京） (which is 教育科技有限公 held as to 司) 97.5% by Mr. Zhou)

Wuhan Tumyu 95% equity after-school N/A(3) N/A(3) N/A N/A Vane Culture interest held tutoring services, &Art by Wuhan and covers key Training Tumyu academic School Co., (which is subjects taught Ltd. (武漢天有 held as to in junior high 風向標文化藝術 95% by school 培訓學校有限公 Mr. Zhou), 司) and the remaining 5% equity interest held by Mr. Zhou directly

Wuhan Nobida 100% equity research and RMB0.9 Net loss of N/A N/A Technology interest held development of million RMB1.8 Co., Ltd. (武 by Wuhan education million 漢諾必答科技有 Tumyu software 限公司) Technology, which is in turn held as to 80% by Wuhan Tumyu (which is held as to 95% by Mr. Zhou)

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Notes:

(1) This is registered as a non-profit school under the 2016 Decision.

(2) Mr. Zhou confirmed that as a minority shareholder, he had no access to such detailed information as at the Latest Practicable Date.

(3) Less than one year since establishment.

Based on our Directors’ best knowledge and information provided by our Controlling Shareholders, we have conducted a potential competition analysis between our business operations and the Excluded Business:

No potential competition

• With respect to Guangshui Scholars School (廣水書生學校)orDawuTumyu Experimental School (大悟天有實驗學校), we currently do not expect any competition as we are not engaged in the provision of compulsory education services.

• With respect to Lesi Moer (Beijing) Education & Technology Co., Ltd. (樂斯摩爾（北京）教育科技有限公司), we currently do not expect any competition as we are not engaged in sales of music teaching materials and instruments.

• With respect to Wuhan Tumyu Vane Culture & Art Training School Co., Ltd. (武漢天有風向標文化藝術培訓學校有限公司), we currently do not expect any competition as we are not engaged in after-school tutoring services.

• With respect to Wuhan Nuobida Technology Co., Ltd. (武漢諾必答科技有限公司), we currently do not expect any competition as we are not engaged in the business of education software.

Potential competition

• With respect to Zhongxiang Tumyu Experimental School (which is registered as a not-for-profit school under the 2016 Decision), our high schools may face potential competition in the following aspects:

(i) Zhongxiang Tumyu Experimental School provides high school education in Hubei province, which is also provided by high schools operated by our Group. Potential students may opt to attend Zhongxiang Tumyu Experimental School or our high schools, and we do not have control over their preference; and

(ii) Zhongxiang Tumyu Experimental School and our Group may potentially compete for teachers and management staff, as both Zhongxiang Tumyu Experimental School and our high schools recruit primarily in Hubei province.

Although the Excluded Business also offers high school education services through Zhongxiang Tumyu Experimental School in Hubei province, we believe that the

– 274 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS above potential competition does not materially and adversely affect our business due to the following reasons:

(i) The high school education provided by Zhongxiang Tumyu Experimental School is different from our high school education in the following aspects:

• Student origins. Students in our high schools are from the communities where our schools are located, including Wuhan, Dawu and Huanggang, Hubei Province, while students in Zhongxiang Tumyu Experimental School are primarily from Zhongxiang, Hubei province. Therefore, potential competition due to geographical overlap within Hubei province is limited; and

• For-profit or non-profit. Our high schools are registered or entitled to be registered as for-profit schools, whereas Zhongxiang Tumyu Experimental School is a non-profit high school, the school sponsor of which will not receive any economic interests through dividends or distributions, and hence there is no economic incentive for Zhongxiang Tumyu Experimental School to compete with our Group for the purpose of receiving dividends or distributions.

(ii) To limit any potential competition between our high schools and Zhongxiang Tumyu Experimental School, each of our Controlling Shareholders [has made] the following undertakings in favour of our Company:

• each of them will not and will procure their close associates (except any member of our Group) not to, directly or indirectly commence, engage in, participate in or acquire any business which competes or may compete directly or indirectly with our business or own any rights or interests in such business, except the existing business of Zhongxiang Tumyu Experimental School; and

• each of them will not and will procure their close associates (except any member of our Group) not to, directly or indirectly participate in [any high school education business], except the existing business of Zhongxiang Tumyu Experimental School.

For more details, see “– Non-competition undertaking”.

Based on the above, our Directors are of the view that despite that the Excluded Business has operations in the education service market in Hubei province, there is a clear business delineation between our Group and the Excluded Business taken as a whole.

Our Directors and the Controlling Shareholders further confirm that there are no costs or expenses relating to our operations that were borne by any related parties or connected persons of our Company or any third parties without being re-charged to our Group; in particular, between our Group and the Excluded Business, (i) there are no overlapping school principals and governance committee; (ii) there are no overlapping teachers; and (iii) there are no overlapping school facilities, except that WHUC leases two dormitory buildings from Beijing Tumyu Technology (which is held as to 95% by Mr. Zhou), and Dawu Tumyu Experimental School (大悟天有實驗學校) operates on properties leased from WHUC (see “Connected Transactions” for further details).

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As at the Latest Practicable Date, Mr. Zhou confirmed that he had no plan to inject the Excluded Businesses into our Group. For completeness, as at the Latest Practicable Date, Wuhan Tumyu (which is held as to 95% by Mr. Zhou) held 100% in Chongqing Michigan Hanmei Education & Technology Co. Ltd. (重慶密西根翰美教育科技有限公司)(“Chongqing Michigan”), which held land use rights of two parcels of land in Chongqing. Our Directors confirm that we did not include Chongqing Michigan into our Group primarily because: (i) we do not currently have any specific development plan in Chongqing or for the land held by Chongqing Michigan; and (ii) pursuant to the terms and conditions of the underlying land transfer contract, the transfer of land title of such land or equity ownership in Chongqing Michigan is subject to approval by local land bureau, who is in the process of resolving a title issue relating to such land together with Chongqing Michigan. Mr. Zhou has confirmed that, as at the Latest Practicable Date, Chongqing Michigan had not commenced any substantive business operation, or construction on such land. In any event, Mr. Zhou [has undertaken] to procure Chongqing Michigan (an associate of Mr. Zhou) to comply with the deed of non-competition, including to offer new business opportunities to us (see “– Non-competition undertaking – Deed of Non-competition” below). Our Controlling Shareholders and our Directors confirm that, save as disclosed above, as at the Latest Practicable Date, neither of them nor their respective close associates had any interest in any business, apart from the business operated by members of our Group, that competes or is likely to compete, directly or indirectly, with the business of our Group and would require disclosure pursuant to Rule 8.10 of the Listing Rules. INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS Having considered the following factors, our Directors are satisfied that our Group is capable of carrying on its business independently of our Controlling Shareholders and their respective close associates after the [REDACTED]. Management independence Our business is managed and conducted by our Board and senior management. Upon the completion of the [REDACTED], our Board will consist of four executive Directors and three independent non-executive Directors. As confirmed by our Controlling Shareholders and to the best of our Directors’ knowledge, Mr. Zhou is the only overlapping director and senior management between our Group on the one hand, and close associates of Mr. Zhou (being our ultimate Controlling Shareholder) on the other hand as set out below: Key positions in close associates of Mr. Zhou as Overlapping director and at the Latest Practicable senior management Positions in our Company Date

Mr. Zhou Chairman, executive Legal representative, Director and chief director and general executive officer manager of Beijing Tumyu, Wuhan Tumyu Technology Co., Ltd. and Beijing Tumyu Technology and a director of some affiliate companies of Beijing Tumyu

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Mr. Zhou is our chairman, executive Director, chief executive officer and Controlling Shareholder. Mr. Zhou also serves as a director and general manager of Beijing Tumyu and a director of Beijing Tumyu Technology and Wuhan Tumyu Technology Co., Ltd. He will continue to serve in such positions immediately following the [REDACTED]. Mr. Zhou confirms that, following the [REDACTED], he will be responsible for formulating the overall corporate strategies and overseeing the performance of management of the Excluded Business but will not be involved in the day-to-day business operations following the [REDACTED]. Accordingly, Mr. Zhou expects to be able to devote majority of his time to perform his duties in our Group following the [REDACTED].

As confirmed by our Directors, save as disclosed above, none of the members of our Board and senior management will hold any position in our Controlling Shareholders and their close associates following the [REDACTED]. Despite of the aforesaid overlapping directors personnel, our Directors consider that our Board and senior management will function independently of our Controlling Shareholders based on the devotion of time to us by the four executive Directors and because:

(1) as confirmed by our Directors, each of our Directors is aware of his fiduciary duties as a Director of our Company which require, among other things, that he acts for the benefit and in the best interests of our Company and does not allow any conflict between his duties as a Director and his personal interest;

(2) in the event that there is a potential conflict of interest arising out of any transaction to be entered into between our Group and our Directors or their respective associates, the interested Directors shall abstain from voting at the relevant board meetings of our Company in respect of such transactions and shall not be counted in the quorum;

(3) our daily management and operations are carried out by a senior management team, all of whom have substantial experience in the industry in which our Company is engaged, and will therefore be able to make business decisions that are in the best interest of our Group;

(4) we have three independent non-executive Directors and certain matters of our Company must always be referred to our independent non-executive Directors for review; and

(5) we have adopted a series of corporate governance measures to manage conflicts of interest, if any, between our Group and our Controlling Shareholders which would support our independent management. See “– Corporate governance measures”.

Operational independence

We have established our own organisational structure comprised of individual departments, each with specific areas of responsibilities. We have also established various internal control procedures to facilitate the effective operation of our business. Our Company (through our subsidiaries and Consolidated Affiliated Entities) holds or enjoys the benefit of all relevant licences and owns all relevant intellectual property and research and development facilities necessary to carry on our business. We have sufficient capital, facilities, equipment and employees to operate our business independently from our Controlling Shareholders. We also have independent access to

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Based on the above, our Directors believe that our Group is not operationally dependent on our Controlling Shareholders or their associates.

Financial independence

Our Group has an independent financial system and makes financial decisions according to our Group’s own business needs. Our Group’s accounting and finance functions are independent of our Controlling shareholders. During the Track Record Period, we primarily financed our business operation through cash flows generated from business activities and bank borrowings. As at the Latest Practicable Date, certain of our bank loans were secured by guarantees provided by Mr. Zhou or pledge of certain properties by an affiliate of Mr. Zhou. Our Directors confirm that the foregoing security will be released or replaced by corporate guarantee(s) to be provided by member(s) of our Group prior to the [REDACTED]. Our Directors also confirm that all of our non-trade amounts due to or from our Controlling Shareholder will be settled prior to the [REDACTED].

Having considered the above, we believe we are able to obtain external financing, when and if necessary, without guarantee or security provided by our Controlling Shareholders. Our Directors confirm that we will not rely on our Controlling Shareholders for financing after the [REDACTED] as we expect that our working capital will be funded from the [REDACTED] and cash flow from operations. Therefore, there is no financial dependence on our Controlling Shareholders.

NON-COMPETITION UNDERTAKING

Deed of Non-competition

On [Š], our Controlling Shareholders [entered] into the deed of non-competition in favour of our Company, pursuant to which our Controlling Shareholders have each undertaken to our Company that they will not and will procure their close associates (except any member of our Group) not to, directly or indirectly (whether in the capacity of principal or agent, whether for its own benefit or jointly with or on behalf of any person, firm or company, whether within or outside China), commence, engage in, participate in or acquire any business (“Restricted Business”) which competes or may compete directly or indirectly with our business or own any rights or interests in such business, except the existing business of Zhongxiang Tumyu Experimental School. In particular, our Controlling Shareholders have each undertaken to us that they will not and will procure their close associates (except any member of our Group) not to, directly or indirectly participate in [any high school education business], except the existing business of [Zhongxiang Tumyu Experimental School].

The Controlling Shareholders have each further undertaken that during the Restricted Period (as defined below), they should and will procure their close associates (except any member of our Group) (the Controlling Shareholders and their close associates together, “Offeror”) to offer new business opportunities to us first in the following manner when any business, investment or other business opportunities

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(“New Business Opportunities”) related to the Restricted Business become available to the Offerors:

(1) the Offerors will make referral of the New Business Opportunities to us, and will within [twenty (20) business days] inform us in writing (“Offer Notice”) about all necessary and reasonably required information in respect of any New Business Opportunities (including but not limited to details of the nature and investment or acquisition cost of the New Business Opportunities) for us to consider (i) whether the relevant New Business Opportunities will compete with our business, and (ii) whether pursuit of the New Business Opportunities is in the interest of our Group;

(2) upon receipt of the Offer Notice, our independent non-executive Directors will consider (after consultation with professional advisers to the extent our independent non-executive Directors consider necessary) whether to pursue the New Business Opportunities taking into account whether the relevant New Business Opportunities would be able to achieve a sustainable profitability level, whether they are in line with the prevailing development strategies of our Group, and whether they are in the best interest of our Shareholders. Our Company must inform the Offeror in writing within [twenty (20) business days] after receipt of the Offer Notice about its decision on whether the New Business Opportunities will be pursued; and

(3) only when (i) the Offerors have received our notice to reject the New Business Opportunities and our confirmation that the relevant New Business Opportunities are not considered to be able to compete with our [Restricted Business]; or (ii) the Offerors have not received the relevant notice from our Company within the period as stated above in paragraph (2) after the Offer Notice has been received by us, then the Offerors are entitled to pursue the New Business Opportunities on terms and conditions not more favourable than those specified in the Offer Notice issued to us.

If material changes occur in the terms and conditions of the New Business Opportunities after the referral of which have been made or procured to be made to us by the Offerors, referral of the revised New Business Opportunities shall be made by the Offerors to us again in the manner as stated above.

The undertakings under the deed of non-competition are not applicable in the following circumstances:

(1) the Controlling Shareholders and/or their respective close associates engage in the [Restricted Business] directly or indirectly through the ownership of equity interest in any member of our Group; or

(2) the Controlling Shareholders and/or their respective close associates engage in the [Restricted Business] directly or indirectly through the ownership of equity interest in listed companies other than our Group, with the following conditions being satisfied:

(i) The [Restricted Business] (and relevant assets) conducted or carried out by such company represents less than 10% of the revenue or total assets of such company according to the latest audited accounts of such company; and

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(ii) the Controlling Shareholders and/or their respective close associates (except any member of our Group) hold in aggregate not more than 10% of the issued share capital of relevant class of shares of such company, and the Controlling Shareholders and/or their respective close associates (except any member of our Group) have no right to appoint the majority of directors of such company or participate in the management of such company.

Pursuant to the deed of non-competition, the Restricted Period refers to the period commences from the [REDACTED] and ends on the following dates (whichever is earlier):

(1) the date when the shares of our Company cease to be [REDACTED] on the Stock Exchange; and

(2) the date when the Controlling Shareholders cease to be controlling shareholders of our Company.

CORPORATE GOVERNANCE MEASURES

Our Directors recognise the importance of good corporate governance in protecting our Shareholders’ interests. We have put in place sufficient corporate governance measures to manage the conflict of interest and potential competition from our Controlling Shareholders and safeguard the interest of the Shareholders, including:

(1) our independent non-executive Directors will review, at least on an annual basis, whether there is any conflict of interest between our Group and our Controlling Shareholders and provide impartial and professional advice to protect the interests of our minority Shareholders;

(2) our independent non-executive Directors will review the compliance with the undertakings under the deed of non-competition by our Controlling Shareholders on an annual basis;

(3) our Controlling Shareholders will provide all information requested by our Company which is necessary for the annual review by our independent non-executive Directors;

(4) our Controlling Shareholders will make an annual declaration on their compliance with the undertakings under the deed of non-competition in our annual report;

(5) our Company will disclose decisions on matters (if any) reviewed by our independent non-executive Directors in the annual reports of our Company or in the announcement under the Listing Rules;

(6) where a Shareholders’ meeting is to be held for considering proposed transactions in which our Controlling Shareholders or any of his associates has a material interest, our Controlling Shareholders will not vote on the resolutions and shall not be counted in the quorum in the voting;

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(7) our Company has established internal control mechanism to identify connected transactions. After the [REDACTED], our Company will comply with the requirements in connection with connected transactions under the Listing Rules;

(8) where our Directors reasonably request the advice of independent professionals, such as financial advisers, the appointment of such independent professionals will be made at our Company’s expense;

(9) we have appointed Somerley Capital Limited as our compliance adviser to provide advice and guidance to us in respect of compliance with the applicable laws and regulations, as well as the Listing Rules, including various requirements relating to corporate governance; and

(10) we [have] established the audit committee, remuneration committee and nomination committee with written terms of reference in compliance with the Listing Rules and the Corporate Governance Code.

Our Directors consider that the above corporate governance measures are sufficient to manage any potential conflict of interests between our Controlling Shareholders and their respective associates and our Group and to protect the interests of our Shareholders, in particular, the minority Shareholders.

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