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THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE. THE INFORMATION IN THIS DOCUMENT MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. SUMMARY This summary is intended to give you an overview of the information contained in this document. Since it is a summary, it does not contain all the information that may be important to you. You should read this document in its entirety before you decide whether to invest in the [REDACTED]. OVERVIEW We are a leading large-scale private higher education and vocational education group in South China, offering applied science-focused and practice-oriented programs. As of October 31, 2019, we had an aggregate of 40,627 students enrolled at our three schools, namely Huali College, Huali Vocational College and Huali Technician College. According to the Frost & Sullivan Report, by the end of 2018, as measured by student enrollment, we ranked second among all private vocational education service providers in South China and ranked fourth among all private higher education service providers in South China. Our schools offer private higher education and private vocational education in a wide range of fields in applied sciences with an aim to prepare our students with the necessary knowledge base, skill sets and accreditations to secure jobs and pursue careers in particular professions, trades and industries. We have designed our curricula with a distinct emphasis on practical, job-oriented content for a variety of majors that are in demand by potential employers in the Pearl River Delta. We conduct employer surveys and on-going research on industry trends and market demand and seek to continuously improve our major offerings and curricula to respond to the changing needs of the job markets. We have also structured our curricula to combine theoretical study with practical training as we believe practical training serves to enhance our students’ ability to apply knowledge and skills to real-life situations and increase their likelihood of employment. We believe our market-focused major offerings, practical job-oriented curricula and practical training help our students to become more marketable to potential employers. We have a track record of nurturing candidates with practical and readily applicable technical skills for many corporate employers including national and local, well-known companies and institutions. We have established a broad network of over 800 corporate employers, primarily located in the Pearl River Delta, through which we are able to assist our students in obtaining internships and job opportunities. We have also built strong relationships with certain corporate employers and offer customized courses designed to recruit and train students that suit the needs of these specific employers upon graduation. The quality of our education, our extensive employer network and dedicated job placement services allow us to achieve high Initial Employment Rates. For the 2017/2018 school year, our Initial Employment Rate of Huali College, Huali Vocational College and Huali Technician College was 95.9%, 93.5% and 98.4%, respectively, ranking them in the top tier among similar schools in South China. We believe that our graduate employment record attests to the effectiveness of our educational approaches as well as helping to enhance our reputation, raise our profile and attract more students. We believe the quality of our education programs, evidenced by our high Initial Employment Rates, has helped us enhance our reputation and achieve steady growth in our revenue and gross profit over the Track Record Period. Our revenue increased from RMB578.2 million for the year ended August 31, 2017 to RMB608.0 million for the year ended August 31, 2018 and further increased to RMB674.8 million for the year ended August 31, 2019. Our gross profit increased from RMB319.4 million for the year ended August 31, 2017 to RMB334.4 million for the year ended August 31, 2018 and further increased to RMB367.8 million for the year ended August 31, 2019. For the years ended August 31, 2017, 2018 and 2019, our gross profit margin was 55.2%, 55.0% and 54.5%, respectively. 1 THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE. THE INFORMATION IN THIS DOCUMENT MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. SUMMARY Our Educational Philosophy Our fundamental educational philosophy is, based on offering applied science-focused higher education, guided by social responsibility and human development, to cultivate talent with high moral characters, knowledge and practical skills, and pragmatic and innovative characteristics. We are also committed to continuously enhancing our school management and social service capabilities, aiming to create value for the education services provided by our “Huali” schools. Our Schools Overview We operate three schools in Guangdong Province, all of which grant government-accredited degrees or certifications, including: Š Huali College: a private independent college, offering four- to five-year undergraduate programs granting bachelor degrees accredited by the MOE, which we operate in cooperation with Guangdong University of Technology. For more details on our arrangements with Guangdong University of Technology, please refer to “Business – Our Schools – Huali College – Cooperation Agreements with Guangdong University of Technology” in this document; Š Huali Vocational College (including Zengcheng campus and Yunfu campus): a formal higher education institution, offering three-year vocational programs granting junior college diplomas accredited by the MOE; and Š Huali Technician College (including Zengcheng campus and Yunfu campus): a private technician school primarily offering three-year, full-time vocational programs granting technician diplomas of Huali Technician College accredited by the Department of Human Resources and Social Security of Guangdong Province and short-term intensive vocational programs. We set forth below some general information of our schools as of the Latest Practicable Date: Academic Structure and Major School / Location Year of Establishment Service Offerings Huali College Founded in 2001 as a private Higher education(1) 33 majors in eight departments, – Zengcheng District, secondary college affiliated including the department of computer Guangzhou City, with Guangdong University of and information engineering, the Guangdong Province Technology and was approved department of urban construction, the by the MOE in 2004 to department of media and art design, become one of the first private the department of management, the independent colleges in department of accounting, the Guangdong to offer department of economics and foreign undergraduate programs languages, the department of electromechanical engineering and a department of international studies organized for students enrolled in the international programs Huali Vocational College Founded in 2005 as a formal Higher education 31 majors in eight departments, – Zengcheng District, higher education institution and vocational including the department of media and Guangzhou City, and offers three-year education(1) art, the department of urban Guangdong Province vocational programs granting construction, the department of – Yunfu City, Guangdong junior college diplomas electronic and intelligent Province accredited by the MOE manufacturing, the department of management, the department of computer and information engineering, the department of health, the department of international economics and foreign languages and the department of accounting 2 THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE. THE INFORMATION IN THIS DOCUMENT MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. SUMMARY Academic Structure and Major School / Location Year of Establishment Service Offerings Huali Technician College Commenced operation in 2000 Vocational 26 majors in 11 departments, – Zengcheng District, as a private tertiary vocational education(1) including the department of art design, Guangzhou City, school, and it was certified as the department of computer, the Guangdong Province a state key vocational school department of accounting, the – Yunfu City, Guangdong in 2005 department of construction Province management, the department of international trade, the department of management, the department of commerce, the department of cuisine, the department of automobile, the department of electromechanics and the department of intelligent manufacturing Note: (1) Higher education is provided by either junior colleges or universities granting different diplomas/degrees. Vocational education includes both secondary vocational education and higher vocational education. Secondary vocational education is provided by technician schools (技工學校), vocational high schools (職業高中) and specialized secondary schools (中等專業學校). Higher vocational education is provided by junior colleges which generally offer three-year vocational programs. Please refer to the diagram set out under the section headed “Industry Overview – Overview of the PRC Education System” in this document for more details. Our Students As of October 31, 2019, we had an aggregate of 40,627 students enrolled in our three schools, including 17,794 students at Huali College, 14,175 students at Huali Vocational College and 8,658 students at Huali Technician College. The following table sets forth the information relating