Shandong Molong Petroleum Machinery : ARTICLES OF ASSOCIATION...

Shandong Molong Petroleum Machinery Company Limited

(A Sino-foreign joint stock limited company incorporated in the People's Republic of China with limited liability)

ARTICLES OF ASSOCIATION

Approval in Extraordinary General Meeting on March 20th, 2004

Revised in Extraordinary General Meeting on September 28th, 2004 (1st Revision)

Revised in Extraordinary General Meeting and Class Shareholders' Meeting on February 14th, 2005 (2nd

Revision)

Revised in Extraordinary General Meeting and Class Shareholders' Meeting on December 5th, 2006 (3rd

Revision)

Revised in Annual General Meeting on May 25th, 2007 (4th Revision) Revised in Annual General Meeting on May 5th, 2008 (5th Revision) Revised in Annual General Meeting on January 8th, 2009 (6th Revision) Revised in Annual General Meeting on May 25th, 2012 (7th Revision) Revised in Extraordinary General Meeting on December 21st, 2018 (8th Revision)

Revised in Annual General Meeting on July 19th, 2020（9th Revision）

Revised in Extraordinary General Meeting on March 3rd, 2021 (10th Revision)

(This Charter are draw up according to currently effective laws, regulations and rules including "Company Law of the People's Republic of China", "Securities Law of the People's Republic of China", "General Provisions for Articles of Association of Companies to be Listed Overseas" ("General Provisions"), (CSRC Overseas Letter [1995] No. 1), "Comments for Further Promoting Standardized Operation and Deepening Reform of Overseas Listed Companies" ("Comments"), "Main Board Listing Rules of The Stock Exchange of Hongkong Ltd" ("Hongkong Listing Rules"), "Rules Governing the Listing of Shares on Shenzhen Stock Exchange" ("Shenzhen Stock Exchange Listing Rules") "Guidelines for the Articles of Association of Listed Companies" (Revised in 2019) issued by CSRC and "The Decision on Certain Rules for the Modification of Cash Bonus Distribution of Listed Companies")

CONTENTS
Chapter 1	General Provisions ………………………………………………………… .3
Chapter 2	Purpose and Scope of Business ..................................................................... 5
Chapter 3	Shares and Registered Capital ....................................................................... 5
Chapter 4	Capital Reduction and Repurchase of Shares .............................................. 10
Chapter 5	Financial Assistance for Purchase of Shares .............................................. 12
Chapter 6	Share Certificates and Register of Shareholders ......................................... 13
Chapter 7	Rights and Obligations of Shareholders ...................................................... 16
Chapter 8	General Meeting of Shareholders ................................................................ 20
Chapter 9	Special Procedures for Voting by Class Shareholders ................................. 34
Chapter 10	Board of Directors ........................................................................................ 36
Chapter 11	Secretary to the Board of Directors ............................................................ 44
Chapter 12	General Manager and Other Senior Management ....................................... 45
Chapter 13	Supervisory Committee ................................................................................ 46
Chapter 14	Qualifications and Obligations of Directors, Supervisors, General Manager 、
Deputy General Manager and Other Senior Management .................... 49
Chapter 15	Financial Accounting System and Profit Distribution ................................. 54
Chapter 16	Appointment Accounting Firm .................................................................... 60
Chapter 17	Insurance ...................................................................................................... 62
Chapter 18	Labour and Personnel Management System ................................................ 62
Chapter 19	Trade Union Organization ............................................................................ 62
Chapter 20	Merger and Division of the Company ......................................................... 63
Chapter 21	Dissolution and Liquidation of the Company .............................................. 63
Chapter 22	Procedures for Amendment of the Company's Articles of Association ...... 65
Chapter 23	Settlement of Disputes ................................................................................. 66
Chapter 24	Notification ................................................................................................... 67
Chapter 25	Supplementary Articles ................................................................................ 67
2

Chapter 1 General Provisions

Article 1

Shandong Molong Petroleum Machinery Co., Ltd (the "Company") is a foreign investment joint stock limited company established in accordance with "The Company Law of the People's Republic of China" ("Company Law"), "The Securities Law of the People's Republic of China", "Special Provisions of the State Council Concerning the Floatation and Listing Abroad of Stocks by Joint Stock Limited Companies" ("Special Provisions") and other related laws and administrative regulations.

Mandatory Provision 1

Approved by the document "Reply for Agreeing to Set Up Shandong Molong Petroleum Machinery Co., Ltd.," (LTGH [2001] No.53) issued by Shandong Economic System Reform Office of The People's Republic of China, the Company was established by promotion on 27 December 2001 and registered with Shandong Provincial Administration of Industry and Commerce on 30 December 2001, and obtained the business license of enterprise legal person, the unified social credit code is: 91370000734705456P.

The promotors of the Company are:

Zhang En Rong

ID number: 37072319400109397X

Address：No. 99 Beihai Road, Shouguang City Development Zone, Shandong Province

Lin Fu Long

ID number: 370723195211184196

Address：Hostel of Shandong Molong Petroleum Machinery Co., Ltd.

Zhamg Yun San

ID number: 370723196201203976

Address：No. 99 Beihai Road, Shouguang City Development Zone, Shandong Province

Xie Xin Cang

ID number: 610303196202211612

Address：Hostel of Shandong Molong Petroleum Machinery Co., Ltd.

Liu Yun Long

ID number: 370723690505399

Address：Shuangjingkou Village, Shangkou County, Shouguang City, Shandong Province

Cui Huan You

ID number: 370723490214397

Address：Shaoliuying Village, Shangkou County, Shouguang City, Shandong Province

Liang Yong Qiang

ID number: 142729680626151

Address：Liyuanxiying Village, Kuiwen District, Weifang City, Shandong Province

Shengli Oilfiled Kaiyuan Oil Development Co., Ltd.

Legal representative: Chen Jian Xiong

Legal address: No. 113, Huanghezhong Road, Dongying District, Dongying City, Shandong Province.

Alloy Material Factory of Gansu Industrial University

Legal representative: Geng Xiang Zhong

Legal address: No. 85 Langongping, Qilihe Area, Lanzhou City, Gansu Province

Article 2

Company registered name (in English) ： Shandong Molong Petroleum Machinery Company Limited

(in Chinese) 山东墨龙石油机械股份有限公司

Mandatory Provision 2

Article 3

Company Address: No. 999 Wensheng Street, Shouguang City, Shandong Province TEL: [phone]

Mandatory Provision 3

Fax: [phone] Postal Code: 262700

Article 4

The legal representative of the Company is the Chairman of the Company.

Mandatory Provision 4

Article 5

The Company is a joint stock limited company which has perpetual existence.

Mandatory Provision 5

In accordance with the requirements of the Company Law and the Constitution of the Communist Party of China, organizations of the Communist Party of China (the ''Party Organization'') and working units shall be established by the Company. The Party Organization shall play a core political role in the Company, and ensure the Company's implementation of the objectives and policies of the Party and the State. The Company shall provide the necessary conditions to facilitate the activities of the Party Organization, promote the institutionalization and standardization of Party-building work, and foster the Party Organization's commencement of activities centering on production and operation, as well as the performance of its role.

Article 6

These Articles of Association shall take effect from the date of passing by the Company's general meeting and upon approval of the competent department of the State, and shall replace in its entirety the original articles of association registered with the Administration of Industry and Commerce.

Mandatory Provision 6

From the date on which these Articles of Association come into effect, these Articles of Association shall constitute a legally binding document regulating the Company's organization and activities, and the rights and obligations between the Company and each shareholder and among the shareholders inter se.

Article 7

These Articles of Association are binding on the Company and its shareholders, directors, supervisors, general manager, deputy general managers and other senior officers of the Company; all of whom are entitled, according to these Articles of Association, to make suggestions in respect of rights concerning the affairs of the Company.

Mandatory Provision 7

A shareholder may take action against the Company pursuant to these Articles of Association and vice versa. A shareholder may also take action against another shareholder; and shareholders and the Company may take action against the directors, supervisors, general manager, deputy general managers and other senior officers of the Company pursuant to these Articles of Association

The actions referred to in the preceding paragraph include court proceedings and arbitration proceedings.

The other senior officers mentioned above are Board Secretary of the Company and head of the finance department. The general manager, deputy general managers and other senior management all are senior officers.

Articles of Listed Companies

Guideline 11

Article 8

Mandatory Provision 8