In light of recent change in the management structure of the Shandong Molong Petroleum Machinery Company Limited resulting in the lack of three executive Directors currently, and in order to effectively protect the interests of Shareholders, establish a sound corporate management system as well as regulate and optimize the corporate governance structure, after taking the actual situation of the Company into consideration and taking advice from the controlling Shareholders, the Company intends to conduct the election of the Board and the Supervisory Committee in advance and all the existing Directors will leave the position with effect from the date of the upcoming EGM (i.e. 21 December 2018) and will not stand for re-election. Among all of them, Mr. Guo Huan Ran would leave from his position as an executive Director, Mr. Guo Hong Li and Ms. Wang Chun Hua would leave their position as non-executive Directors, and Mr. Qin Xue Chang, Ms. Quan Yu Hua and Mr. Ji Yan Song would leave from their position as independent non-executive Directors. The above Directors had made undertakings, respectively, that before having obtained approval for new Director qualifications and assuming office formally, they would continue to perform their duties according to the requirements of laws, administrative regulations, departmental rules and Articles of Association.