Company: DDC
Filing Date: 2025-01-28
Form Type: 20-F
Source: 0001213900-25-007160
Chunk: 203

Company: DDC Enterprise Ltd
Filing Date: 2025-01-28
Form: 20-F
Item: Item 19
Chunk 203
---
”
or “ WFOE”), the Company’s wholly-owned subsidiary. A series of contractual agreements, including Exclusive Consultancy
and Service Agreement, Exclusive Purchase Agreement, Proxy Agreement, Equity Pledge Agreement and Loan Agreement (collectively, the “ Weishi
VIE Agreements”), were entered among Shanghai DayDayCook, Weishi and its nominee equity holder and were effective until April 1,
2022, when the Company decided to terminate the VIE agreements.

Pursuant to these contractual agreements, the
Company is able to exercise effective control over, bear the risks of, and enjoy substantially all of the economic benefits of Weishi,
and has an exclusive option to purchase all of the equity interests in Weishi when and to the extent permitted by the PRC law at the lowest
price possible. The Company’s management concluded that Weishi is a VIE and WFOE is its primary beneficiary. As such, the financial
statements of Weishi are included in the consolidated financial statements of the Company.

The Weishi VIE agreements between WFOE and Weishi
have been updated with the principal terms effective until March 31, 2022 summarized as follows:

1) Exclusive Consultancy and Service Agreement

WFOE and Weishi entered into an Exclusive Consultancy
and Service Agreement whereby WFOE is appointed as the exclusive service provider for the provision of management consulting, technical
support, intellectual property licensing and other relevant services to Weishi during the service period, which is 20 years and will
be automatically renewed for 20 years upon each expiration.

It is agreed that the WFOE shall be entitled to
substantially all of the economic benefits and bear all the risks of Weishi. Weishi shall pay WFOE on a quarterly basis a service fee,
which shall be equal to all the quarterly profit before tax and before the service fee after covering the deficit for prior years, if
any. WFOE has the discretion to adjust the basis of calculation of the service fee amount according to service provided to Weishi.

Weishi and its nominee shareholder shall accept
the service provided by the WFOE, cannot receive services from other third parties directly or indirectly, and shall not enter into any
transaction that may cause conflict with the agreement or negatively affect the interests under the agreement.

F-16

1. DESCRIPTION OF BUSINESS AND ORGANISATION(cont.)

2) Exclusive Option Agreement

The WFOE has exclusive right to purchase the equity
interests and assets in Weishi