Mongolian Mining Corporation (MMC, 00975) has executed a three-year Supply and Service Agreement with connected party Top Motors LLC, covering the period from 1 September 2026 to 31 August 2029.

The contract appoints Top Motors—an authorised Toyota dealer wholly owned by MCS Holding—as the sole provider of light vehicles, spare parts, maintenance, rental and exterior repair services for MMC’s Ulaanbaatar headquarters and its Ukhaa Khudag (UHG) and Bayan Khundii (BKH) mining operations. The agreement caps aggregate consideration at MNT 33.59 billion (USD 9.34 million), inclusive of VAT and associated costs.

Annual spending limits have been set as follows: • 4 months ending 31 Dec 2026: up to MNT 3.73 billion (USD 1.04 million) • FY 2027: up to MNT 11.20 billion (USD 3.11 million) • FY 2028: up to MNT 11.20 billion (USD 3.11 million) • 8 months ending 31 Aug 2029: up to MNT 7.46 billion (USD 2.08 million)

Pricing was set after arm’s-length negotiations and a tender involving Mongolia’s three authorised Toyota dealers; only Top Motors and one independent bidder submitted proposals. MMC cited Top Motors’ competitive pricing, safety standards and technical capability as decisive factors.

The enlarged scope versus the 2023–26 contract—now including Erdene Mongol LLC, rental of light vehicles and exterior repairs—accounts for about 30% of the increased caps. Inflation, currency movements and higher official Toyota prices also contributed to the uplift.

Top Motors qualifies as a connected person because its parent, MCS Mongolia LLC, ultimately controls a 31.65% stake in MMC through MCS Mining Group. As the highest applicable percentage ratio for the annual caps exceeds 0.1% but remains below 5%, the transactions are classified as continuing connected transactions under Hong Kong Listing Rules, requiring announcement and annual review but not independent shareholders’ approval.

Historical spending under the current 2023–26 agreement totals MNT 10.84 billion (USD 2.92 million) through 31 July 2026, reflecting rising demand for vehicle-related services at MMC’s mining sites.

Management asserts that the new agreement is on normal commercial terms, supported by competitive tendering, and aligns with MMC’s operational needs. Internal controls—including monthly invoicing, payment within 45 days and ongoing audit oversight—are in place to monitor compliance with Listing Rule requirements.