Ju Teng International Holdings Limited announced that reference is made to the announcements of the Company dated 2 February 2009, 25 November 2011, 16 December 2014, 31 December 2014, 27 December 2017 and 17 December 2020 in relation to the Existing Compal Master Sales Agreements and/or (as the case may be) the Existing Wistron Master Sales Agreements. Pursuant to the Existing Compal Master Sales Agreements and the Existing Wistron Master Sales Agreements, the Group has been selling the Products to the Compal Group and the Wistron Group on an on-going basis. The Existing Compal Master Sales Agreements and the Existing Wistron Master Sales Agreements will expire on 31 December 2023. To ensure continual supply of the Products by the Group to the Compal Group and the Wistron Group after the expiry of the terms of the Existing Compal Master Sales Agreements and the Existing Wistron Master Sales Agreements, respectively, the Group has entered into the Compal Master Sales Renewal Agreement and the Wistron Master Sales Renewal Agreement on 27 December 2023. Due to the uniqueness of the Products, the Products are only manufactured upon the order made by the Compal Group. In order to assess whether the sale price of the Products under the Compal Master Sales Renewal Agreement is fair and reasonable and no less favourable than that between the Group and Independent Purchasers, before selling any Products to the Compal Group pursuant to the Compal Master Sales Renewal Agreement, the Group would take into account the expected profit
margin in such transaction as compared with other transactions between the Group and other Independent Purchasers for purchase of other similar products of the Group. In any event, the profit margin of the transaction under the Compal Master Sales Renewal Agreement should be no less favourable than those applicable to the sales of other similar products by the Group to the Independent Purchasers. The Directors (including the independent non-executive Directors) consider that such measure can ensure that the transactions contemplated under the Compal Master Sales Renewal Agreement will be conducted on normal commercial terms and not prejudicial to the interest of the Company and the Shareholders as a whole. The price of the Products shall be payable by the Compal Group to the Group in arrears ranging from 45 to 120 days' credit period by transferring to the Group's bank account. The Compal Master Sales Renewal Agreement is for a period from 1 January 2024 to 31 December 2026 (both dates inclusive) unless terminated earlier by 30 days' written notice according to the terms and conditions of the Compal Master Sales Renewal Agreement.