Company: DDC
Filing Date: 2025-01-28
Form Type: 20-F
Source: 0001213900-25-007160
Chunk: 237

Company: DDC Enterprise Ltd
Filing Date: 2025-01-28
Form: 20-F
Item: Item 19
Chunk 237
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1,599,746            421,449  
  Unallocated other expenses, net                                       ( 266,083,985                  -       ( 10,440,057  
  Unallocated changes in fair value of financial instruments             ( 60,764,404        ( 1,875,889         17,101,260  
  Total consolidated loss before income tax expenses                    ( 457,866,566      ( 119,132,855      ( 156,970,922  

(ai) Statutory Reserves

In accordance with the PRC Company Laws, the paid-in
capitals of the PRC subsidiaries and VIEs are not allowed to be transferred to the Company by way of cash dividends, loans or advances,
nor can they be distributed except for liquidation.

In addition, in accordance with the PRC Company
Laws, the Company’s PRC subsidiaries and VIEs must make appropriations from their after-tax profits as determined under the generally
accepted accounting principles in the PRC (“ PRC GAAP”) to non-distributable reserve funds including statutory surplus fund
and discretionary surplus fund. The appropriation to the statutory surplus fund must be10% of the after-tax profits after offsetting
any prior year losses as determined under PRC GAAP. Appropriation is not required if the statutory surplus fund has reached50% of
the registered capital of the PRC companies. Appropriation to the discretionary surplus fund is made at the discretion of the PRC companies.

The statutory surplus fund and discretionary surplus
fund are restricted for use. They may only be applied to offset losses or increase the registered capital of the respective companies.
These reserves are not allowed to be transferred to the Company by way of cash dividends, loans or advances, nor can they be distributed
except for liquidation.

No appropriation to the reserve fund was made
by the Company’s PRC subsidiaries and VIEs, as these PRC Companies had accumulated losses as determined under PRC GAAP for the years
ended December 31, 2021, 2022 and 2023.

F-46

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(cont.)

(aj) Shareholders’
approval on the share consolidation

On November 16, 2023, the Company obtained shareholders’
approval of the share consolidation of every16issued and outstanding shares of each class with par value of US$0.001into one share
of the same class (“share consolidation”) with a