Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 203

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 19
Chunk 203
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 and
its designated representative, no other person shall be entitled to purchase such equity and assets or other rights related to the equity
or assets in the FSCs.

The purchase price of equity shall be the lower
of the contribution by the nominee equity holders of the FSCs and the minimum price permitted by the applicable PRC laws. Pursuant to
the FSCs Exclusive Option Agreements, the nominee equity holders of the FSCs and/or the FSCs shall not terminate the FSCs Exclusive Option
Agreements unilaterally in any event unless otherwise required by applicable compulsory laws.

On January 10, 2019, the WFOE and City Modern
entered into a purchase agreement with Mr. Cui Yixiong, controlling shareholder of City Modern and his wife Ms. Wang Yike, to acquire
the business carried out by City Modern and its consolidated FSCs, for a total consideration of RMB1and360,144share options granted
to Mr. Cui Yixiong.

F-19

1. DESCRIPTION OF BUSINESS AND ORGANISATION(cont.)

The WFOE obtained control over City Modern and
its controlled FSCs through a number of contractual agreements, including Exclusive Consultancy and Service Agreement, Exclusive Purchase
Agreement, Proxy Agreement, Equity Pledge Agreement and Spousal Consent Letter (collectively, the “ Farm VIE Agreements”) with
City Modern, Mr. Cui Yixiong and Ms. Wang Yike.

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

1) Exclusive Consultancy and Service Agreement

The WFOE provides management consulting, technical
support, intellectual property licensing and other relevant services to City Modern during the service period, which is20 yearsand will be automatically renewed for20 yearsupon each expiration.

The WFOE is able to receive substantially all
of the economic benefits of and bear all the risks of City Modern. When City Modern has operating loss or significant operating difficulties,
WFOE has the right to request City Modern to cease operations and City Modern must unconditionally accept WFOE’s request. City Modern
shall pay WFOE on a quarterly basis a service fee, which shall be equal to all the quarterly profit before tax excluding the service fees
and after covering the deficits from prior years, if any. WFOE has the discretion to adjust the basis of calculation of the service
fee according to the actual services provided to City Modern.

City Modern and