Company: DDC
Filing Date: 2025-01-28
Form Type: 20-F
Source: 0001213900-25-007160
Chunk: 298

Company: DDC Enterprise Ltd
Filing Date: 2025-01-28
Form: 20-F
Item: Item 19
Chunk 298
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change of terms in the 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 of December 31, 2022, the February 2022 Convertible
Loan was recorded as current liability at amortized cost.

In February 2023, the Company extended the repayment
date of the February 2022 Convertible from the original February 2023 to December 2023, or an earlier date if agreed by both parties (“the
second modification”).

In June 2023, the Company further extended the
repayment date of the February 2022 Convertible Loan from February 2023 to January 2025, or an earlier date if agreed by both parties.
Other terms remained the same. (“the third modification”).

F-88

18. CONVERTIBLE LOANS AND SHAREHOLDER LOANS(cont.)

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

In December 2023, the Company repaid the February
2022 Convertible Loan.

May 2022 Convertible Loan

In May 2022, the Company entered into a convertible
loan agreement with a new lender for a total principal amount of RMB3.5million (US$0.5million) (“the May 2022 Convertible
Loan”). The repayment date falls on 12 months from the date of the May 2022 Convertible Loan agreement, provided, that if a Qualified
IPO has not occurred within 12 months from the date of the May 2022 Convertible Loan, the parties hereby agree that the repayment date
shall be extended by 3 months. Interest rate is0% per annum. The Company, at its discretion shall issue the conversion shares to the
lender at the conversion price on the date of listing of the qualified IPO. The conversion price is US$13.5552per share.

As the embedded conversion features are underlying
ordinary shares of a private company and could not be publicly traded or readily convertible into cash, the embedded conversion feature
is not an embedded derivative and does not require bifurcation.

The Company further evaluated the embedded contingent
redemption feature and concluded