Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 202

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 19
Chunk 202
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 and Jiapin Ecological are farmers’ specialized cooperatives (together the “ FSCs”) in China. Legal
members of FSCs shall consist of no less than80% qualified farmers. Mr. Cui Yixiong controlled these FSCs since their establishment,
and the formal contractual agreements, including Exclusive Consultancy and Service Agreement and Exclusive Option Agreement (collectively,
the “ FSC VIE Agreements”), were entered into among City Modern, and the nominee equity holders, i. e. the qualified farmers
of the FSCs in January 2019.

The principal terms of the FSC VIE arrangements
are as follows:

1) Exclusive Consultancy and Service Agreement

City Modern shall provide management consulting,
technical support, intellectual property licensing and other relevant services to the FSCs during the service period, which is 20 years
and will be automatically renewed for 20 years upon each expiration. The FSCs shall pay to City Modern100% of their net profit as
service fees for the consultancy services provided by City Modern.

The FSCs and their nominee equity holders shall
accept the services provided by City Modern, 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 unless with the
prior written consent of City Modern.

The FSCs shall strictly follow the City Modern’s
decision to operate the business and should obtain the City Modern’s written approval before signing any significant contract, including
share transfer, financing, land leasing, operating, etc.

2) Exclusive Option Agreement

Pursuant to the three Exclusive Option Agreements
dated 2019 entered into by and between City Modern and the nominee equity holders of the FSCs (the “ FSCs Exclusive Option Agreements”),
the nominee equity holders of the FSCs irrevocably granted to City Modern an exclusive and unconditional option to purchase the FSCs’
equity and assets.

City Modern has the absolute right to determine
the specific time, method, frequency of exercising the above option, and has the right to request the nominee equity holders of the FSCs,
at any time, to transfer the entire equity of the FSCs to City Modern (or its designated representative), and has the right to request,
at any time, the FSCs to transfer to City Modern (or its designated representative) the FSCs’ assets. Except for City Modern