Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 270

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 19
Chunk 270
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 hereby agree
that the repayment date shall be extended by 3 months. Interest rate is0% per annum. Loan conversion shall take place automatically on
or immediately before the date of listing of the qualified IPO. The conversion price is US$19.84per share, or a price per share that
equals to US$300,000,000divided by the Company’s total number of shares immediately before Qualified IPO calculated on fully diluted
basis, whichever is lower.

In August 2022, the Company renewed the August
2021 Convertible Loan agreement and also revised certain terms. Based on the revised terms, the repayment date is August 30, 2023 or an
earlier date if agreed by both parties. Interest rate is0% per annum. Loan conversion shall take place automatically on or immediately
before the date of listing of the qualified IPO. The conversion price is US$11.68per share, or a price per share that equals to US$210million divided by the Company’s total number of shares immediately before Qualified IPO calculated on fully diluted basis, or a
price per share that equals to80% of the price per share of Qualified IPO, whichever is lower.

The Company assessed whether there were substantial
changes of terms of the August 2021 Convertible Loan. If the terms are substantially different, the modification is accounted for as a
debt extinguishment. Otherwise, it is accounted for as a modification. In order to determine whether the terms are substantially different
upon each modification, the Company compared whether the present value of the cash flows under the terms of the modified debt instrument
is at least 10 percent different from the present value of the remaining cash flows under the terms of the original debt instrument. If
the terms of a non-convertible debt instrument are modified and the cash flow effect on a present value basis is less than 10 percent,
the debt instruments are not considered to be substantially different. The calculation of the present value of the cash flows of the new
debt instruments included all cash flows specified by the terms of the new debt instruments plus any amounts paid by the Company.

Based on the above assessment, it was determined
that there was no substantial change of terms in the modification and the new debt was accounted for at amortized cost using a new effective
interest rate determined based on the original debt’s net carrying amount after deducting the revised cash flow under the term of
the modified debt instrument.

As the embedded conversion features are underlying
ordinary shares of