Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 170

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 10
Chunk 170
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ing taxable years or, if shorter, the U. S. Holder’s holding period for the Class A Ordinary Shares), and (ii) any
gain realized on the sale or other disposition of Class A Ordinary Shares. Under these rules,

  the U. S. Holder’s gain or excess distribution will be allocated ratably over the U. S. Holder’s holding period for the Class A Ordinary Shares;  

  the amount allocated to the current taxable year and any taxable years in the U. S. Holder’s holding period prior to the first taxable year in which we are classified as a PFIC (each, a “pre-PF...  

  the amount allocated to each prior taxable year, other than a pre-PFIC year, will be subject to tax at the highest tax rate in effect for individuals or corporations, as appropriate, for that y...  

  an additional tax equal to the interest charge generally applicable to underpayments of tax will be imposed in respect of the tax attributable to each prior taxable year, other than a pre-PFIC ...  

If we are treated as a PFIC
for any taxable year during which a U. S. Holder holds our Class A Ordinary Shares, or if any of our subsidiaries is also a PFIC,
such U. S. Holder would be treated as owning a proportionate amount (by value) of the shares of any lower-tier PFICs for purposes
of the application of these rules. U. S. Holders are urged to consult their tax advisors regarding the application of the PFIC rules
to any of our subsidiaries.

As an alternative to the foregoing
rules, a U. S. Holder of “marketable stock” in a PFIC may make a mark-to-market election with respect to such stock,
provided that such stock is “regularly traded” within the meaning of applicable U. S. Treasury regulations. If our Class
A Ordinary Shares qualify as being regularly traded, and an election is made, the U. S. Holder will generally (i) include as
ordinary income for each taxable year that we are a PFIC the excess, if any, of the fair market value of Class A Ordinary Shares held
at the end of the taxable year over the adjusted tax basis of such Class A Ordinary Shares and (ii) deduct as an ordinary loss the
excess, if any, of the adjusted tax basis of the Class A Ordinary Shares over the fair market value of such Class A Ordinary Shares held
at the end of the taxable year