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National Company for Learning & Education (NCLE) announces the progress of IPO proceeds usage as of 31 May 2020

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Announcement Detail National Company for Learning & Education (NCLE) announces the progress of Initial Public Offering (IPO) proceeds usage as of May 31, 2020 which was received in late November of 2018 is as follows:

A) Actual usage of the IPO proceeds as of 31/05/2020 compared with the disclosed in the IPO prospectus and previous announcements:

1. The total IPO proceeds were (247,000,000) Saudi Riyals.

2. Total IPO expenses were (16,014,303) Saudi Riyals.

3. The net IPO proceeds after deducting all expenses related to the IPO were (230,985,697) Saudi Riyals.

B) The net IPO proceeds were allocated to be used based on the IPO prospectus and the adjustment made by the general assembly meeting held on 25/12/2019 as follows:

1. Total amount of (59,603,369) Saudi Riyals were allocated to fund the construction and operation of Al-Qassim Educational campus in Buraidah City, Qassim Province.

2. Total amount of (51.991.683) Saudi Riyals were allocated to fund the construction and operation of Tilal Al-Doha Educational campus in Dhahran City, Eastern Province.

3. The amount of (66.7) million Saudi Riyals were allocated to fund the acquisition of Al-Ghad National Schools Company Limited and Al-Khawarzmi Education Company.

4. The amount of (42.7) million Saudi Riyals and to fund the construction, equipping, furnishing and operation of Al-Qairawan Educational campus in Riyadh City.

C) The variance of the actual usage of IPO proceeds compared with what has been disclosed in the IPO prospectus and previous announcements, and the justifications for such variances:

1. The total amount of (59.603.369) Saudi Riyals were allocated up to 29/02/2020 to fund the construction and operation of Al-Qassim Educational campus in Buraidah City, Qassim Province. An amount of (45.689.186) Saudi Riyals was used as of 31/05/2020 and the remaining allocated amount was not used as per the IPO prospectus until 31/05/2020 due to natural operational circumstances during the commencement of the campus operation by gradually opening the educational levels which led to equip, furnish and operate the campus on different stages based on the actual need instead of fully equipping and furnishing the campus at the commencement of operation, which achieves the company's interest in using its cash resources. This variance has no financial material impact on the current fiscal period and NCLE will announce any material update on this matter in due time.

On 07/08/2019, NCLE announced the opening and operation of the KG and early elementary stages starting from the academic year 2019-2020, which was opened one year in advance for KG and early elementary stages compared to the original plan as disclosed in the IPO prospectus.

2. The total amount of (51.991.683) Saudi Riyals was allocated up to 31/05/2020 to fund the construction and operation of Tilal Al-Doha Educational campus in Dhahran City, Eastern Province. An amount of (12.796.156) Saudi Riyals was used as of 31/05/2020 and the remaining allocated amount was not used as per the IPO prospectus until 31/05/2020 due to the delay in issuance licenses from the relevant authorities which led to the delay in starting the construction. This variance has no financial material impact on the current fiscal period and NCLE will announce any material update on this matter in due time.

It should be noted that the Board of Directors decided on 07/01/2020 to commence the operation of the campus starting from the academic year 2021-2022 instead of 2020-2021 academic year.

Additional information:

1. An amount of (66.7) million Saudi Riyals was allocated to fund the acquisition of Al-Ghad National Schools Company Limited and Al-Khawarzmi Education Company, and the total amount was used as of 31/05/2020 and the transactions were completed as per the applicable regular procedures.

2. An amount of (37.7 million) from the (42.7) million Saudi Riyals allocated for funding the construction, equipping, furnishing and operation of Al-Qairawan Educational campus in Riyadh City, was used as of 31/05/2020.

The Capital Market Authority and the Saudi Stock Exchange take no responsibility for the contents of this disclosure, make no representations as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this disclosure, and the issuer accepts full responsibility for the accuracy of the information contained in it and confirms, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts or information the omission of which would make the disclosure misleading, incomplete or inaccurate.

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