JTF International Holdings Ltd (JTF INTL) has inked an “Exclusive Entrusted Operation and Management Agreement” under which wholly-owned subsidiary Zengcheng City Jin Taifeng Fuel Oil Co. (JTF (PRC)) will take over the day-to-day management of Zhuhai Changlian Petrochemical Equipment for three years, starting once independent shareholders grant approval at an extraordinary general meeting (EGM) scheduled for 30 June 2026 in Zhuhai.

The deal, signed with Zhuhai Xinhe (Changlian’s parent and a connected person) on 2 April and supplemented on 11 May 2026, grants JTF (PRC) exclusive rights to formulate budgets, streamline internal controls, reduce warehousing and transport costs, and expand Changlian’s sales network. JTF (PRC) will not be involved in raw-material procurement or production safety.

Fee Structure • 2026: A fixed management fee ranging from RMB0.50 million (minimum) to RMB5.00 million, linked to Changlian’s audited net profit. • 2027–2028: Fixed management fee of RMB0.50 million per year plus a performance incentive triggered only if annual profit exceeds the 2026 benchmark. Incentive tiers pay 30% of the benchmark profit plus 40%–70% of excess profit, depending on the magnitude of growth. Estimated service delivery cost to JTF (PRC) is RMB0.49 million per annum, covering five existing employees allocating about 30% of their time.

Annual Caps • 2026: RMB5.00 million • 2027: RMB20.00 million • 2028: RMB50.00 million

These limits reflect Changlian’s profit forecasts, which anticipate a swing from a RMB63.64 million loss in 2026 to RMB62.11 million profit in 2027 and RMB128.37 million in 2028 as upgraded facilities boost processing volumes from 620,000 tonnes to 750,000 tonnes.

Background on Changlian Unaudited results show revenue of RMB4.07 billion, RMB3.94 billion and RMB2.22 billion for 2023–2025, with net profit sliding from RMB425.74 million in 2023 to a RMB139.98 million loss in 2025 after a production halt for equipment upgrades.

Governance and Compliance Because Changlian’s ultimate owner, Executive Director and controlling shareholder Ms Huang Sizhen, holds 51.63% of JTF INTL (via Thrive Shine Ltd) and is married to Chairman Mr Xu Ziming, the deal constitutes a continuing connected transaction under Chapter 14A of Hong Kong’s Listing Rules. Both Ms Huang and Mr Xu have abstained from voting on the board resolution, and their controlled shares will not vote at the EGM.

Risk Controls JTF INTL has set an 80% early-warning threshold on each annual cap, will conduct monthly fee forecasts, and will seek shareholder approval to revise caps if needed. An independent auditor will verify Changlian’s adjusted net profit before fees are invoiced.

The Independent Board Committee and Somerley Capital, acting as Independent Financial Adviser, both recommend shareholders to support the agreement, citing fair terms and alignment with shareholder interests.