Correspondence 0000950170-22-026113 from Four Seasons Education (Cayman) Inc. (FEDU) (CIK 0001709819) (FEDU)
Four Seasons Education (Cayman) Inc. (FEDU) (CIK 0001709819)
Date: Dec. 7, 2022 · CIK: 0001709819 · Accession: 0000950170-22-026113
AI Filing Summary & Sentiment
File numbers found in text: 001-38264
Referenced dates: November 25, 2022
Letter
Division of Corporation Finance Office of Trade & Services Securities and Exchange Commission Re: Four Seasons Education (Cayman) Inc. Form 20-F for Fiscal Year Ended February 28, 2022 Response Dated November 4, 2022 File No. 001-38264
Dear Mr. Nalbantian and Ms. Wirth:
This letter sets forth the response of Four Seasons Education (Cayman) Inc. (the “Company”) to the comments contained in the letter dated November 25, 2022 from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) regarding the Company’s November 4, 2022 response and the Company’s annual report on Form 20-F for the fiscal year ended February 28, 2022 (the “Form 20-F”).
For ease of review, we have set forth below each of the numbered comments of the Staff’s letter and the Company’s responses thereto. We propose to file an amendment to the Form 20-F (the “Amended Form 20-F”) once all comments have been addressed to the Staff’s satisfaction.
Response Dated November 4, 2022
Item 3. Key Information, page 5
1.We note your response to comment 1. Please revise to explain whether the VIE structure is used to provide investors with exposure to foreign investment in China-based companies where Chinese law prohibits direct foreign investment in the operating companies. We also note your disclosure that "PRC laws and regulations place certain restrictions on direct foreign investment in and ownership of private education businesses." Please revise to clarify that PRC laws and regulations place certain restrictions on direct foreign investment in and ownership of China-based issuers and in addition, on private education businesses. Please revise this disclosure throughout your annual report.
Response: In response to the Staff’s comment, we propose to add the following disclosure concerning our operations in the PRC through the VIEs in the Amended Form 20-F, with the added disclosure underlined and the removed disclosure crossed out for ease of reference:
Division of Corporation Finance
Office of Trade & Services
Page 2
Page 5 of the Form 20-F.
Our Holding Company Structure and Contractual Arrangements with the Consolidated Affiliated Entities VIEs
Four Seasons Education (Cayman) Inc. is not a Chinese an operating company in the People’s Republic of China (“China” or “PRC”), but a Cayman Islands holding company which does not conduct operations and has with no equity ownership in the VIEs. PRC laws and regulations place certain restrictions on direct foreign investment in and ownership of China-based companies that engage in private education businesses. Accordingly, we conduct our operations in the PRC principally through contractual arrangements among (i) our WFOE, namely Shanghai Fuxi Information Technology Service Co., Ltd., or Shanghai Fuxi, (ii) variable interest entities consolidated under U.S. GAAP, or the consolidated VIEs, our VIEs, namely Shanghai Four Seasons Education and Training Co., Ltd. and Shanghai Four Seasons Education Investment Management Co., Ltd., limited liability companies established under PRC law, and their subsidiaries affiliated entities, and (iii) the shareholders of the consolidated VIEs, which provides investors with exposure to foreign investment in the Chinese operating companies. We effectively control each VIE through contractual arrangements among such VIE, its shareholder and Shanghai Fuxi Information Technology Service Co., Ltd., or Shanghai Fuxi. Net revenues contributed by the VIEs accounted for 100% of our net revenues in the fiscal years ended February 28/29, 2020, 2021 and 2022, respectively.
Page 89 of the Form 20-F.
Contractual Arrangements with theOur VIEs, TheirIts Shareholder and Us
PRC laws and regulations place certain restrictions on direct foreign investment in and ownership of China-based companies that engage in private education businesses. Accordingly, we conduct our operations in the PRC principally through our VIEs, namely Shanghai Four Seasons Education and Training Co., Ltd. and Shanghai Four Seasons Education Investment Management Co., Ltd., and their affiliated entities. Accordingly, we conduct our operations in the PRC principally contractual arrangements among (i) our WFOE, namely Shanghai Fuxi Information Technology Service Co., Ltd., or Shanghai Fuxi, (ii) the consolidated variable interest entities, or the consolidated VIEs, our VIEs, namely Shanghai Four Seasons Education and Training Co., Ltd. and Shanghai Four Seasons Education Investment Management Co., Ltd., limited liability companies established under PRC law, and their subsidiaries affiliated entities, and (iii) the shareholders of the consolidated VIEs, which provides investors with exposure to foreign investment in the Chinese operating companies. We effectively control each VIE through contractual arrangements among such VIE, its shareholder and Shanghai Fuxi.
2.We note your amended disclosure in response to comment 3; however it appears that you continue to use "we," "us," and "our" to reference the operations of your VIEs. Please revise throughout to refrain from using terms such as “we” or “our” when describing activities or functions of a VIE. For example, we note your statements "[a]s used in this annual report, “we,” “us,” “our company,” and “our” refers to Four Seasons Education (Cayman) Inc., a
Division of Corporation Finance
Office of Trade & Services
Page 3
Cayman Islands company, its subsidiaries, and, in the context of describing our operations and consolidated financial information, the VIEs ... " and "[a]s of the date of this annual report, all our PRC subsidiaries and VIEs ... ."
Response: In light of the Staff’s comment, we propose to revise the definition as follows, with the added disclosure underlined and the removed disclosure crossed out for ease of reference, and will revise throughout the Amended Form 20-F accordingly:
Page 3 of the Form 20-F.
“Four Seasons,” “we,” “us,” “our company,” “the Company,” and “our” refer to Four Seasons Education (Cayman) Inc., a Cayman Islands exempted company, the Parent and its subsidiaries, its VIEs and its VIEs’ affiliated entities;
“variable interest entities” or “VIEs” refers to Shanghai Four Seasons Education and Training Co., Ltd. and Shanghai Four Seasons Education Investment Management Co., Ltd, and their subsidiaries, which are PRC companies in which we do not have equity interests but whose financial results have been consolidated into our consolidated financial statements in accordance with U.S. GAAP as we have effective control over, and are the primary beneficiary of these entities. Our reference to control over the VIEs and their subsidiaries and our position of being the primary beneficiary of the VIEs and their subsidiaries for the accounting purposes are strictly in the context of the conditions that we met for consolidation of the VIEs under U.S. GAAP. Such conditions include that (i) we have the power to govern the activities which most significantly impact the VIEs and their subsidiaries’ economic performance, (ii) we are contractually obligated to absorb losses of the VIEs and their subsidiaries that could potentially be significant to the VIEs and their subsidiaries, and (iii) we are entitled to receive benefits from the VIEs and their subsidiaries that could potentially be significant to the VIEs and their subsidiaries. Only if we meet the aforementioned conditions for consolidation of the VIEs and their subsidiaries under U.S. GAAP, we will be deemed as the primary beneficiary of the VIEs and their subsidiaries, and the VIEs and their subsidiaries will be consolidated in our consolidated financial statements for accounting purposes; and “affiliated entities” refer to our VIEs, the VIEs’ branches and direct and indirect subsidiaries, and the VIEs’ affiliated entities that registered as private non-enterprise institutions under the PRC laws;
Page 5 of the Form 20-F.
As used in this annual report, “we,” “us,” “our company,” and “our” refers to Four Seasons Education (Cayman) Inc. the Parent, a Cayman Islands company, and its subsidiaries, and, in the context of describing our operations and consolidated financial information, the VIEs, including the VIEs’ affiliate entities. The VIEs are consolidated for accounting purposes when describing the consolidated financial information. Investors of our ADSs are not purchasing equity interest in the VIEs in China but instead are purchasing equity interest in a holding company incorporated in the Cayman Islands, and may never hold equity interests in the VIEs.
Pages 9 to 10 of the Form 20-F.
Division of Corporation Finance
Office of Trade & Services
Page 4
Permissions Required from the PRC Authorities for Our Operations and those of the consolidated VIEs
We conduct our business primarily through our subsidiaries and the VIEs in China. Our operations and those of the consolidated VIEs in China are governed by PRC laws and regulations. As part of the efforts to fully comply with the Opinion and applicable rules, regulations and measures, we ceased offering the K9 Academic AST Services in PRC at the end of 2021, spun off some of the subsidiaries engaged in K9 Academic AST Services and stopped to renew our Permits for Operating Private School. As of the date of this annual report, all our PRC subsidiaries and the VIEs have obtained business license, all three learning centers have obtained fire safety permit, one subsidiary of a VIE, Shanghai Huashi Oriental Digital Publishing Co., Ltd., has obtained permit for Operating Publications Business, and one of the VIEs, Shanghai Four Seasons Education and Training Co., Ltd., has obtained the filing certificate of Information System Security Level Protection. As such, based on the advice of our PRC counsel, Fangda Partners, we believe our PRC subsidiaries and the VIEs have obtained all of the requisite licenses and permits from the PRC government authorities that are necessary for the business operations and our Cayman holding company does not need to obtain any licenses or permits from the PRC government authorities as it has no business operation in PRC. other than disclosed in “Item 3. Key Information-D. Risk Factors-Risks Related to Doing Business in the PRC-We are required to obtain various operating licenses and permits and to make registrations and filings for our current business in China; failure to comply with these requirements may materially and adversely affect our business and results of operations” and “If we fail to obtain and maintain the licenses and approvals as well as registrations and filings required under the uncertain regulatory environment for online education in China, our business, financial condition and results of operations may be materially and adversely affected,”
3.We note your amended disclosure in response to comment 4. Please revise to clarify that the legal and operational risks associated with operating in China also apply to any operations in Hong Kong and Macau.
Response: In response to the Staff’s comment, in addition to the revisions made to the definition of “China” or “PRC” as stated in the previous response, we also propose to add the following disclosure in the Amended Form 20-F, with the added disclosure underlined and the removed disclosure crossed out for ease of reference:
Uncertainties with respect to the PRC legal system could have a material adverse effect on us.
……
In addition, the PRC administrative and judicial authorities have significant discretion in interpreting, implementing or enforcing statutory rules and contractual terms, and it may be more difficult to predict the outcome of administrative and judicial proceedings and the level of legal protection we may enjoy in the PRC than under some more developed legal systems. These uncertainties may affect our decisions on the policies and actions to be taken to comply with PRC laws and regulations, and may affect our ability to enforce our contractual or tort rights. In
Division of Corporation Finance
Office of Trade & Services
Page 5
addition, the regulatory uncertainties may be exploited through unmerited legal actions or threats in an attempt to extract payments or benefits from us. Such uncertainties may therefore increase our operating expenses and costs, and materially and adversely affect our business and results of operations.
Hong Kong is a Special Administrative Region of the PRC and enjoys its own limited autonomy as defined by the Basic Law of Hong Kong. Hong Kong’s legal system, which is different from that of mainland China, is based on common law and has its own laws and regulations, but some of the national laws of the PRC are made applicable in Hong Kong under the Basic Law. It has been speculated that there may be increased alignment between PRC laws and regulations and the Basic Law or that PRC laws and regulations will be applied directly in Hong Kong. If certain PRC laws and regulations relevant to our business operations were to become applicable in Hong Kong in the future, we may face legal and operational risks and uncertainties relating to our operations in Hong Kong.
Furthermore, we respectfully advise the Staff that we do not conduct any business operations in Macau. As a result, we are not subject to material operational risks associated with Macau.
4.We note your response to comment 6. Please identify clearly the entity in which investors could purchase their interest. Also, please revise your structure chart to include the four entities owned by Shanghai Fuxi Information Technology Service Co., Ltd. and the two companies owned by Shanghai Four Seasons Education Investment Management Co., Ltd. Please elaborate on the 41 companies owned by Shanghai Four Seasons Education and Training Co., by including a description of the material operations of such subsidiaries, or another applicable description.
Response: In response to the Staff’s comments, we propose to add the following disclosure in the Amended Form 20-F, with the added disclosure underlined and the removed disclosure crossed out for ease of reference:
Page 5 of the Form 20-F.
As used in this annual report, “we,” “us,” “our company,” and “our” refers to Four Seasons Education (Cayman) Inc. the Parent, a Cayman Islands company, and its subsidiaries, and, in the context of describing our operations and consolidated financial information, the VIEs, including the VIEs’ affiliate entities. The VIEs are consolidated for accounting purposes when describing the consolidated financial information. Investors of our ADSs are not purchasing equity interest in the VIEs in China but instead are purchasing equity interest in the Parent, a holding company incorporated in the Cayman Islands, and may never hold equity interests in the VIEs.
We also propose to revise the referenced diagram in the Amended Form 20-F as follows, with the added disclosure underlined for ease of reference:
Division of Corporation Finance
Office of Trade & Services
Page 6
(1) 41 Companies that operate in the fields of educational tourism and planning, enrichment learning, faculty training, investment management, management consulting, and publications, etc.
5.We note your amended disclosure in response to comment 7. Please revise the statement "[w]e effectively control each VIE through contractual arrangements among such VIE, its shareholder and our WFOE Shanghai Fuxi" and the bulleted list that states that the contractual arrangements allow you to (1) exercise effective control over each of the VIEs and its subsidiaries and (2) receive substantially all of the economic benefits of each VIE, along with any other similar statement,
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CORRESP
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CORRESP
December 7, 2022
VIA CORRESPONDENCE
Division of Corporation Finance
Office of Trade & Services
Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Attn:
Nicholas Nalbantian
Cara Wirth
Re: Four Seasons Education (Cayman) Inc.
Form 20-F for Fiscal Year Ended February 28, 2022
Response Dated November 4, 2022
File No. 001-38264
Dear Mr. Nalbantian and Ms. Wirth:
This letter sets forth the response of Four Seasons Education (Cayman) Inc. (the “Company”) to the comments contained in the letter dated November 25, 2022 from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) regarding the Company’s November 4, 2022 response and the Company’s annual report on Form 20-F for the fiscal year ended February 28, 2022 (the “Form 20-F”).
For ease of review, we have set forth below each of the numbered comments of the Staff’s letter and the Company’s responses thereto. We propose to file an amendment to the Form 20-F (the “Amended Form 20-F”) once all comments have been addressed to the Staff’s satisfaction.
Response Dated November 4, 2022
Item 3. Key Information, page 5
1.We note your response to comment 1. Please revise to explain whether the VIE structure is used to provide investors with exposure to foreign investment in China-based companies where Chinese law prohibits direct foreign investment in the operating companies. We also note your disclosure that "PRC laws and regulations place certain restrictions on direct foreign investment in and ownership of private education businesses." Please revise to clarify that PRC laws and regulations place certain restrictions on direct foreign investment in and ownership of China-based issuers and in addition, on private education businesses. Please revise this disclosure throughout your annual report.
Response: In response to the Staff’s comment, we propose to add the following disclosure concerning our operations in the PRC through the VIEs in the Amended Form 20-F, with the added disclosure underlined and the removed disclosure crossed out for ease of reference:
Division of Corporation Finance
Office of Trade & Services
Page 2
Page 5 of the Form 20-F.
Our Holding Company Structure and Contractual Arrangements with the Consolidated Affiliated Entities VIEs
Four Seasons Education (Cayman) Inc. is not a Chinese an operating company in the People’s Republic of China (“China” or “PRC”), but a Cayman Islands holding company which does not conduct operations and has with no equity ownership in the VIEs. PRC laws and regulations place certain restrictions on direct foreign investment in and ownership of China-based companies that engage in private education businesses. Accordingly, we conduct our operations in the PRC principally through contractual arrangements among (i) our WFOE, namely Shanghai Fuxi Information Technology Service Co., Ltd., or Shanghai Fuxi, (ii) variable interest entities consolidated under U.S. GAAP, or the consolidated VIEs, our VIEs, namely Shanghai Four Seasons Education and Training Co., Ltd. and Shanghai Four Seasons Education Investment Management Co., Ltd., limited liability companies established under PRC law, and their subsidiaries affiliated entities, and (iii) the shareholders of the consolidated VIEs, which provides investors with exposure to foreign investment in the Chinese operating companies. We effectively control each VIE through contractual arrangements among such VIE, its shareholder and Shanghai Fuxi Information Technology Service Co., Ltd., or Shanghai Fuxi. Net revenues contributed by the VIEs accounted for 100% of our net revenues in the fiscal years ended February 28/29, 2020, 2021 and 2022, respectively.
Page 89 of the Form 20-F.
Contractual Arrangements with theOur VIEs, TheirIts Shareholder and Us
PRC laws and regulations place certain restrictions on direct foreign investment in and ownership of China-based companies that engage in private education businesses. Accordingly, we conduct our operations in the PRC principally through our VIEs, namely Shanghai Four Seasons Education and Training Co., Ltd. and Shanghai Four Seasons Education Investment Management Co., Ltd., and their affiliated entities. Accordingly, we conduct our operations in the PRC principally contractual arrangements among (i) our WFOE, namely Shanghai Fuxi Information Technology Service Co., Ltd., or Shanghai Fuxi, (ii) the consolidated variable interest entities, or the consolidated VIEs, our VIEs, namely Shanghai Four Seasons Education and Training Co., Ltd. and Shanghai Four Seasons Education Investment Management Co., Ltd., limited liability companies established under PRC law, and their subsidiaries affiliated entities, and (iii) the shareholders of the consolidated VIEs, which provides investors with exposure to foreign investment in the Chinese operating companies. We effectively control each VIE through contractual arrangements among such VIE, its shareholder and Shanghai Fuxi.
2.We note your amended disclosure in response to comment 3; however it appears that you continue to use "we," "us," and "our" to reference the operations of your VIEs. Please revise throughout to refrain from using terms such as “we” or “our” when describing activities or functions of a VIE. For example, we note your statements "[a]s used in this annual report, “we,” “us,” “our company,” and “our” refers to Four Seasons Education (Cayman) Inc., a
Division of Corporation Finance
Office of Trade & Services
Page 3
Cayman Islands company, its subsidiaries, and, in the context of describing our operations and consolidated financial information, the VIEs ... " and "[a]s of the date of this annual report, all our PRC subsidiaries and VIEs ... ."
Response: In light of the Staff’s comment, we propose to revise the definition as follows, with the added disclosure underlined and the removed disclosure crossed out for ease of reference, and will revise throughout the Amended Form 20-F accordingly:
Page 3 of the Form 20-F.
“Four Seasons,” “we,” “us,” “our company,” “the Company,” and “our” refer to Four Seasons Education (Cayman) Inc., a Cayman Islands exempted company, the Parent and its subsidiaries, its VIEs and its VIEs’ affiliated entities;
“variable interest entities” or “VIEs” refers to Shanghai Four Seasons Education and Training Co., Ltd. and Shanghai Four Seasons Education Investment Management Co., Ltd, and their subsidiaries, which are PRC companies in which we do not have equity interests but whose financial results have been consolidated into our consolidated financial statements in accordance with U.S. GAAP as we have effective control over, and are the primary beneficiary of these entities. Our reference to control over the VIEs and their subsidiaries and our position of being the primary beneficiary of the VIEs and their subsidiaries for the accounting purposes are strictly in the context of the conditions that we met for consolidation of the VIEs under U.S. GAAP. Such conditions include that (i) we have the power to govern the activities which most significantly impact the VIEs and their subsidiaries’ economic performance, (ii) we are contractually obligated to absorb losses of the VIEs and their subsidiaries that could potentially be significant to the VIEs and their subsidiaries, and (iii) we are entitled to receive benefits from the VIEs and their subsidiaries that could potentially be significant to the VIEs and their subsidiaries. Only if we meet the aforementioned conditions for consolidation of the VIEs and their subsidiaries under U.S. GAAP, we will be deemed as the primary beneficiary of the VIEs and their subsidiaries, and the VIEs and their subsidiaries will be consolidated in our consolidated financial statements for accounting purposes; and “affiliated entities” refer to our VIEs, the VIEs’ branches and direct and indirect subsidiaries, and the VIEs’ affiliated entities that registered as private non-enterprise institutions under the PRC laws;
Page 5 of the Form 20-F.
As used in this annual report, “we,” “us,” “our company,” and “our” refers to Four Seasons Education (Cayman) Inc. the Parent, a Cayman Islands company, and its subsidiaries, and, in the context of describing our operations and consolidated financial information, the VIEs, including the VIEs’ affiliate entities. The VIEs are consolidated for accounting purposes when describing the consolidated financial information. Investors of our ADSs are not purchasing equity interest in the VIEs in China but instead are purchasing equity interest in a holding company incorporated in the Cayman Islands, and may never hold equity interests in the VIEs.
Pages 9 to 10 of the Form 20-F.
Division of Corporation Finance
Office of Trade & Services
Page 4
Permissions Required from the PRC Authorities for Our Operations and those of the consolidated VIEs
We conduct our business primarily through our subsidiaries and the VIEs in China. Our operations and those of the consolidated VIEs in China are governed by PRC laws and regulations. As part of the efforts to fully comply with the Opinion and applicable rules, regulations and measures, we ceased offering the K9 Academic AST Services in PRC at the end of 2021, spun off some of the subsidiaries engaged in K9 Academic AST Services and stopped to renew our Permits for Operating Private School. As of the date of this annual report, all our PRC subsidiaries and the VIEs have obtained business license, all three learning centers have obtained fire safety permit, one subsidiary of a VIE, Shanghai Huashi Oriental Digital Publishing Co., Ltd., has obtained permit for Operating Publications Business, and one of the VIEs, Shanghai Four Seasons Education and Training Co., Ltd., has obtained the filing certificate of Information System Security Level Protection. As such, based on the advice of our PRC counsel, Fangda Partners, we believe our PRC subsidiaries and the VIEs have obtained all of the requisite licenses and permits from the PRC government authorities that are necessary for the business operations and our Cayman holding company does not need to obtain any licenses or permits from the PRC government authorities as it has no business operation in PRC. other than disclosed in “Item 3. Key Information-D. Risk Factors-Risks Related to Doing Business in the PRC-We are required to obtain various operating licenses and permits and to make registrations and filings for our current business in China; failure to comply with these requirements may materially and adversely affect our business and results of operations” and “If we fail to obtain and maintain the licenses and approvals as well as registrations and filings required under the uncertain regulatory environment for online education in China, our business, financial condition and results of operations may be materially and adversely affected,”
3.We note your amended disclosure in response to comment 4. Please revise to clarify that the legal and operational risks associated with operating in China also apply to any operations in Hong Kong and Macau.
Response: In response to the Staff’s comment, in addition to the revisions made to the definition of “China” or “PRC” as stated in the previous response, we also propose to add the following disclosure in the Amended Form 20-F, with the added disclosure underlined and the removed disclosure crossed out for ease of reference:
Uncertainties with respect to the PRC legal system could have a material adverse effect on us.
……
In addition, the PRC administrative and judicial authorities have significant discretion in interpreting, implementing or enforcing statutory rules and contractual terms, and it may be more difficult to predict the outcome of administrative and judicial proceedings and the level of legal protection we may enjoy in the PRC than under some more developed legal systems. These uncertainties may affect our decisions on the policies and actions to be taken to comply with PRC laws and regulations, and may affect our ability to enforce our contractual or tort rights. In
Division of Corporation Finance
Office of Trade & Services
Page 5
addition, the regulatory uncertainties may be exploited through unmerited legal actions or threats in an attempt to extract payments or benefits from us. Such uncertainties may therefore increase our operating expenses and costs, and materially and adversely affect our business and results of operations.
Hong Kong is a Special Administrative Region of the PRC and enjoys its own limited autonomy as defined by the Basic Law of Hong Kong. Hong Kong’s legal system, which is different from that of mainland China, is based on common law and has its own laws and regulations, but some of the national laws of the PRC are made applicable in Hong Kong under the Basic Law. It has been speculated that there may be increased alignment between PRC laws and regulations and the Basic Law or that PRC laws and regulations will be applied directly in Hong Kong. If certain PRC laws and regulations relevant to our business operations were to become applicable in Hong Kong in the future, we may face legal and operational risks and uncertainties relating to our operations in Hong Kong.
Furthermore, we respectfully advise the Staff that we do not conduct any business operations in Macau. As a result, we are not subject to material operational risks associated with Macau.
4.We note your response to comment 6. Please identify clearly the entity in which investors could purchase their interest. Also, please revise your structure chart to include the four entities owned by Shanghai Fuxi Information Technology Service Co., Ltd. and the two companies owned by Shanghai Four Seasons Education Investment Management Co., Ltd. Please elaborate on the 41 companies owned by Shanghai Four Seasons Education and Training Co., by including a description of the material operations of such subsidiaries, or another applicable description.
Response: In response to the Staff’s comments, we propose to add the following disclosure in the Amended Form 20-F, with the added disclosure underlined and the removed disclosure crossed out for ease of reference:
Page 5 of the Form 20-F.
As used in this annual report, “we,” “us,” “our company,” and “our” refers to Four Seasons Education (Cayman) Inc. the Parent, a Cayman Islands company, and its subsidiaries, and, in the context of describing our operations and consolidated financial information, the VIEs, including the VIEs’ affiliate entities. The VIEs are consolidated for accounting purposes when describing the consolidated financial information. Investors of our ADSs are not purchasing equity interest in the VIEs in China but instead are purchasing equity interest in the Parent, a holding company incorporated in the Cayman Islands, and may never hold equity interests in the VIEs.
We also propose to revise the referenced diagram in the Amended Form 20-F as follows, with the added disclosure underlined for ease of reference:
Division of Corporation Finance
Office of Trade & Services
Page 6
(1) 41 Companies that operate in the fields of educational tourism and planning, enrichment learning, faculty training, investment management, management consulting, and publications, etc.
5.We note your amended disclosure in response to comment 7. Please revise the statement "[w]e effectively control each VIE through contractual arrangements among such VIE, its shareholder and our WFOE Shanghai Fuxi" and the bulleted list that states that the contractual arrangements allow you to (1) exercise effective control over each of the VIEs and its subsidiaries and (2) receive substantially all of the economic benefits of each VIE, along with any other similar statement,