Risks Related to Ownership of Our Class A Ordinary Shares
Because of its significant share ownership, our principal shareholder will be able to exert control over us and our significant corporate decisions.
Our principal shareholder, Red Football LLC, controls 27.69% of our issued and outstanding Class A ordinary shares and 83.06% of our issued and outstanding Class B ordinary shares, representing 81.34% of the voting power of our outstanding capital stock. Each Class A ordinary share is entitled to one vote per share and is not convertible into any other class of shares. Each Class B ordinary share is entitled to 10 votes per share and is convertible into one Class A ordinary share at any time. In addition, our Class B ordinary shares will automatically convert into shares of our Class A ordinary shares upon certain transfers and other events, including upon the date when holders of all Class B ordinary shares cease to hold Class B ordinary shares representing at least 10% of the total number of Class A and Class B ordinary shares outstanding. For special resolutions, which require the vote of two-thirds of the votes cast, at any time that Class B ordinary shares remain outstanding, the voting power permitted to be exercised by the holders of the Class B ordinary shares will be weighted such that the Class B ordinary shares shall represent, in the aggregate, 67% of the voting power of all shareholders. As a result, our principal shareholder will have the ability to determine the outcome of all matters submitted to our shareholders for approval, including the election and removal of directors and any merger, consolidation, or sale of all or substantially all of our assets. The interests of our principal shareholder might not coincide with the interests of the other shareholders. This concentration of ownership may harm the value of our Class A ordinary shares, among other things:
• delaying, deferring or preventing a change in control of our Company;
• impeding a merger, consolidation, takeover or other business combination involving our Company; or
• causing us to enter into transactions or agreements that are not in the best interests of all shareholders