Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 205

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 19
Chunk 205
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 certificate or the like to the WFOE’s escrow within 3 working days
after the execution of these contractual arrangements. In the event of the occurrence of any change of the share capital or the entrusted
shareholding of City Modern, City Modern and its nominee shareholders shall update the registration and/or filings relating to the equity
pledges required by the applicable laws and deliver the updated share certificate or the like to the WFOE’s escrow.

Up to March 31, 2022, the equity pledge agreement
has not been registered with relevant government authorities.

5) Spousal Consent Letter

Pursuant to the Spousal Consent Letters executed
by the spouse of the nominee shareholders of City Modern, the signing spouse confirmed that he/she does not enjoy any right or interest
in connection with the equity interests of City Modern. The spouse also irrevocably agreed that he/she would not claim in the future any
right or interest in connection with the equity interests in City Modern held by his/her spouse.

Termination of the VIE agreements with Farm Entities

On April 1, 2022 the Company entered into a sale
and purchase agreement as well as an agreement to terminate the Farm VIE Agreements with Mr. Cui Yixiong and Ms. Wang Yike to transfer
the Farm Entities to Mr. Cui Yixiong and Ms. Wang Yike for RMB1. The share options previously issued to Mr. Cui Yixiong in connection
with the acquisition of Farm Entities were returned and cancelled. At the same time, the Company granted22,509new share options to Mr.
Cui Yixiong. Upon the termination, the Company recognized a gain from termination of the Farm Entities VIE arrangement of RMB13,116,960,
which is measured as the difference between(i) the consideration of RMB1 receivable, (ii) the incremental fair value of RMB1,424,721
of the share options exchanged on April 1, 2022, and (iii) the carrying amount of Farm Entities’ net liabilities of RMB15,658,584,
including goodwill of RMB1,116,904. The disposal of the Farm Entities discontinued the Company’s fresh products business. The Company’s
management believes that the termination of the Farm VIE Agreements does not represent a strategic shift that has a major effect on the
Company’s operations and financial results and is not accounted as discontinued operation.

F-