Ordinary Shares
We issued 65,377,160 ordinary shares to NetEase on March 7, 2018 and issued 26,612,840 ordinary shares to Net Depth Holdings, Inc. on
March 28, 2018, in each case in exchange for nominal cash consideration as part of an offshore restructuring of our company in connection with our series A financing in April 2018.
Immediately prior to the completion of our initial public offering on October 24, 2019, the issued and outstanding ordinary shares
beneficially owned by (i) NetEase, (ii) Dr. Zhou, our Chief Executive Officer and director, and (iii) certain individual minority shareholders who are our employees, were converted into Class B ordinary shares, and the
remaining issued and outstanding ordinary shares and all the Series A preferred shares were converted into Class A ordinary shares, in each case on a one-to-one
basis immediately.
In October 2019, at the closing of our initial public offering and concurrent private placements, we issued and sold
an aggregate of 5,600,000 Class A ordinary shares in the form of ADSs and 7,352,941 Class A ordinary shares to Orbis, at a public offering price of US$17.00 per ADS.
Preferred Shares
On April 17, 2018, we issued 4,867,725 Series A preferred shares to TH EDU CAPITAL FUND I LP for a consideration of US$50,000,000.
On April 17, 2018, we issued 1,947,090 Series A preferred shares to GOOD SPIRIT LIMITED for a consideration of US$20,000,000.
As none of the holders of our Series A preferred shares were related parties prior to such holders initial investment in our securities,
the price of our Series A preferred shares was determined based on negotiations between us and the investors and were approved by our board of directors. Immediately prior to the completion of our initial public offering on October 24, 2019,
all Series A preferred shares that were issued and outstanding at the time were converted into our Class A ordinary shares on a one-for-one basis.
Option and Equity Award Grants
We have granted options to purchase our ordinary shares to certain of our executive officers and employees. See Item 6. Directors,
Senior Management and Employees B. Compensation in our annual report on Form 20-F for the year ended December 31, 2019, which is incorporated in this prospectus by
reference.
Shareholders Agreement
Our currently effective shareholders agreement was entered into on April 17, 2018 by and among us, our shareholders, and certain other
parties named therein, which was amended on September 25, 2019.
The current shareholders agreement provides for certain special
rights, including right of participation and right of co-sale, and contains provision governing the board of directors and other corporate governance matters. These special rights, as well as the corporate
governance provisions, automatically terminated after the completion of our initial public offering.
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