Company: DDC
Filing Date: 2025-08-05
Form Type: F-3/A
Source: 0001213900-25-072059
Chunk: 77

Company: DDC Enterprise Ltd
Filing Date: 2025-08-05
Form: F-3/A
Chunk 77
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 at least 10% of their accumulated after-tax profits each year, if any, to fund a certain statutory reserve fund,
until the aggregate amount of such fund reaches 50% of their respective registered capital. Such reserve funds cannot be distributed to
us as dividends.

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Our PRC subsidiaries generate
primarily all of their revenue in RMB, which is not freely convertible into other currencies. As a result, any restriction on currency
exchange may limit the ability of our applicable PRC subsidiaries to use their RMB revenues to pay dividends to us.

The PRC government may continue
to strengthen its capital controls, and more restrictions and substantial vetting process may be put forward by SAFE for cross-border
transactions falling under both the current account and the capital account. Any limitation on the ability of our applicable PRC subsidiaries
to pay dividends or make other kinds of payments to us could materially and adversely limit our ability to grow, make investments or acquisitions
that could be beneficial to our business, pay dividends, or otherwise fund and conduct our business.

In addition, the Enterprise
Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to dividends payable by
Chinese companies to non-PRC-resident enterprises (having no institution or establishment within China or whose incomes have no actual
connection to its institution or establishment within China) unless otherwise exempted or reduced according to treaties or arrangements
between the PRC central government and governments of other countries or regions where the non-PRC-resident enterprises are incorporated.

PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from making loans or additional capital contributions to our PRC subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.

We are a Cayman Islands holding
company conducting a significant portion of our operations in China through our PRC subsidiaries. We may make loans to our PRC subsidiaries
subject to the approval or registration from governmental authorities and limitation of amount, or we may make additional capital contributions
to our wholly foreign-owned subsidiaries in China. Any loans to our subsidiaries in China are subject to foreign debt registrations. In
addition, the foreign exchange receipts under the capital account of a domestic institution shall be used pursuant to the principle of
authenticity and self-use within its business scope. The foreign exchange receipts under the capital account of a domestic institution