Company: DDC
Filing Date: 2025-01-28
Form Type: 20-F
Source: 0001213900-25-007160
Chunk: 292

Company: DDC Enterprise Ltd
Filing Date: 2025-01-28
Form: 20-F
Item: Item 19
Chunk 292
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2022, the Company agreed with
the lender to extend the remaining unpaid principal of HK$15.7million to be expired on the earlier of (i) the consummation of a qualified
IPO; (ii) the date falling fourteen (14) business days after receiving a repayment notice. At any time after the Company has received
a new round of financing of not less than US$20.0million, the lender may elect to request the Company for repayment of the indebtedness;
and (iii) October 25, 2023. The interest of the outstanding amount of the loan remains at8% per annum (“the sixth modification”).

It was determined that there was no substantial
change of terms in the fifth and sixth modifications 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 and the revised cash flow under the term of the modified debt instrument.

As the Class A OS Warrant has not been exercised
by 25 September 2023, the Class A OS Warrant expired on 25 September 2023.

2020 Convertible Loan

In March 2020, the Company issued US$ denominated
convertible loan for an aggregate principal amount of US$3.0million. Further, in June, July and October 2020, the Company issued
convertible loans with the aggregate principal amount of US$1.6million. Collectively, these convertible loans are referred to as
the “2020 Convertible Loan”. The 2020 Convertible Loan bear interest of10% per annum and have terms of 12 months from
the draw down date.

Upon the proposed financing, lenders could elect
to convert the 2020 Convertible Loan into preferred shares issued in the proposed financing, at a conversion price equal to65% per share
price applicable in the proposed financing. Upon qualified IPO, lenders could elect to convert the 2020 Convertible Loan into ordinary
shares, at a conversion price equal to65% per IPO share price.

Concurrently with the drawdown of the 2020 Convertible
Loan, the lenders were issued warrants (the “ C-1 Warrant”), pro rata to their lending principal amount, which entitle them
to, upon the occurrence of: (1) a qualified IPO, (2) proposed financing, or (3) a liquidation event, requesting the Company
to issue certain amount of ordinary shares in the case of