COMPANY BY-LAWS (STATUTS)

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1 VALLOUREC TUBES SAS with capital of 1,503,948,690 Registered office : 27 av Gal Leclerc, Boulogne-Billancourt Nanterre Trade and Companies Register no COMPANY BY-LAWS (STATUTS) Decisions of the Sole Shareholder of 17 June 2016 Increase of the share capital

2 VALLOUREC A French simplified joint-stock company (SAS) with capital of 1,503,948,690 Registered office : 27 av Gal Leclerc, Boulogne-Billancourt Registered on the Nanterre Trade and Companies Register under no COMPANY BY-LAWS (STATUTS) TITLE I OBJECT - NAME REGISTERED OFFICE - LIFE Article 1 - Form The company was incorporated in the form of a French public limited company (société anonyme). It was converted into a simplified joint-stock company (société par actions simplifiée) by a decision of its shareholders [hereinafter the "Shareholders"] on 15 March It shall be governed by the laws and regulations in force relating to simplified joint-stock companies and by the Company's by-laws. The Company may not under any circumstances make a public offering. Article 2 - Object The Company has the following object in all countries, either on its own behalf or on behalf of third parties: a. acquiring, holding and transferring in any way whatsoever holdings in all businesses or undertakings whose main business, either in France or abroad, is producing tube rounds and bars as raw material for the manufacture of seamless carbon-based and steel alloybased tubes, manufacturing seamless carbon-based and steel alloy-based hot-rolled tubes (including ingots for subsequent processing) including hot-rolled milling, hot treatment and threading of these products and subsequent processing thereof, marketing and selling these products; 2

3 b. managing and coordinating industrial, commercial and financial policies for the businesses and undertakings referred to in the foregoing paragraph; c. supplying administrative, legal and financial or other services that may facilitate the activities carried out for the businesses and undertakings referred to in paragraph a above; and d. generally, all commercial, industrial and financial transactions, in real or personal property, directly or indirectly related to the above-mentioned Company object or that may facilitate the fulfilment thereof. Article 3 - Name The Company's name shall be: Vallourec Tubes. The Company's name shall appear in all deeds and documents issued by the Company and intended for third parties, immediately preceded or followed by the words "société par actions simplifiée" or the initials "SAS", and the amount of the share capital. Article 4 - Registered office 1. The registered office shall be located at 27 avenue du Général Leclerc, Boulogne- Billancourt, Hauts de Seine. 2. It may be transferred to any other location in the same département (administrative district) or a bordering département by a decision of the Chairman, who shall be authorised to amend the Company's by-laws accordingly, and to any other place pursuant to a collective decision of the Shareholders. Article 5 - Life The Company's life is set at 99 full and consecutive years as from the date it is registered on the Trade and Companies Register, unless the Company is dissolved early or its life is extended as provided for in these by-laws. TITLE II CONTRIBUTIONS - SHARE CAPITAL - SHARES - OBLIGATIONS Article 6 - Contributions The Company was incorporated in the form of a French public limited company (société anonyme) with capital of FRF 250,000, divided into 2,500 shares of FRF 100 each, on 12 March 1997, and was registered with the Nanterre [Commercial Court] Registry on 18 March It was called Valcinq. The Ordinary and Extraordinary General Meeting held on 30 September 1997 decided to change the Company's name to Vallourec & Mannesmann Tubes and to adopt new bylaws. 3

4 The Extraordinary General Meeting held on 19 December 1997 decided to increase the Company's capital by FRF 11,897,000 by issuing, at par, 118,970 class A shares reserved for Valtubes, to increase the Company's capital by FRF 88,943,000 by issuing, at par, 889,430 class B shares reserved for Mannesmannröhren-Werke AG, to accept a contribution in kind of securities by Valtubes, valued and remunerated by 4,219,178 class A shares, representing an increase of FRF 412,917,800, and to accept a contribution in kind of securities by Mannesmannröhren-Werke AG, valued and remunerated by 2,659,964 class B shares, representing a [capital] increase of FRF 265,996,400 and an issue premium of FRF 503,799,479. Another Extraordinary General Meeting held on 19 December 1997 decided to increase the Company's capital by FRF 660 million by creating 3,630,000 class A shares and 2,970,000 class B shares. The Extraordinary General Meeting held on 2 May 2000 decided to increase the Company's capital by FRF 710, by creating 3,910,148 class A shares and 3,199,212 class B shares. The Ordinary and Extraordinary General Meeting held on 5 June 2001 decided to change over to the euro by reducing the share capital by an amount of FRF 34,698, by allocating this amount to the legal reserve. The share capital was thus reduced to FRF 2,125,241,840.66, the equivalent of 323,991,030. Thus the par value [of a share] could be set at 15, with the same number of shares, i.e. 21,599,402. The Ordinary and Extraordinary General Meeting held on 26 June 2003 decided to increase the Company's capital by 150 million by creating 10 million shares with a par value of 15, to be paid for in cash. The same General Meeting decided to bring the Company's by-laws into compliance with the new Act no of 15 May 2001 by amending articles 9, 10, 13, 14, 15, 16 and 18. The Extraordinary General Meeting held on 23 June 2005 decided to amend article 9 of the Company's by-laws. The Ordinary and Extraordinary General Meeting of 15 March 2006 decided to transform the company into a French simplified joint-stock company (société par actions simplifiée S.A.S.) managed by a Board of Directors. The Extraordinary General Meeting of 29 December 2006 decided to increase the share capital by 352,935 through the creation of 23,529 shares with a par value of 15 per share as consideration for a first merger by absorption of Setval S.a.r.l and to increase the share capital by 18,240,480 through the creation of 1,216,032 shares with a par value of 15 each as consideration for a second merger by absorption of ValTubes S.A.S. As a result of these two transactions, with effect from 31 December 2006, the share capital increased from 473,991,030, divided into 31,599,402 shares, to 492,584,445, divided into 32,838,963 shares. By decisions dated as of October 31, 2011, of the sole shareholder, the share capital has been increased by a nominal amount of 270,124,245 (two hundred and sixty ten million one hundred twenty-four thousand two hundred forty five euros), by issuance of 18,008,283 (eighteen million eight thousand two hundred and eighty three) new ordinary shares with a nominal value of 15 (15 euros), at the price of (fifty-five euro and fifty three cents), with a share premium of (forty euro and fifty three cents) per ordinary share, representing a gross capital increase of 999,999, (nine hundred 4

5 ninety nineteen million nine hundred eighty Nineteen thousand nine hundred fifty-four euro and ninety nine cents). This capital increase was fully conducted by compensation with liquid and payable by the shareholder claims and resulted to the share capital of a nominal amount of (four hundred four twenty twelve million five hundred eighty-four thousand four hundred and forty-five euros) to a nominal amount of (seven hundred and sixty two million seven hundred and eight thousand six hundred ninety euros). By decisions dated September 24, 2013 of the shareholder, the corporate name of the company is amended, with effect from October 1, 2013, to adopt the name: «VALLOUREC TUBES. By decisions dated December 11, 2014, of the sole shareholder, the share capital was increased by nominal amount of million ( million euros), at a price of (fifty seven euros and forty-two cents), or with a premium issuance of (forty two euros and forty-two cents) per common share, representing a gross capital increase of 1,000,026,720 (on billion twenty six thousand seven hundred and twenty euros). This capital increase was fully realized by cash contribution of the sle shareholder and had the consequence of increasing the share capital by a nominal amount of 762,708,690 (seven hundred and sixty-two millions seven hundred and eight thousand six hundred and four twenty ten euros) for a nominal amount of 1,023,948,690 (one billion twenty three million nine hundred forty eight thousand six hundred and ninety euros). By decisions dated June 17, 2016, the sole shareholder decided to increase the share capital by a nominal amount of 480,000,000, with a premium issuance of 320,000,000, representing a gross capital increase of 800 million, to raise the share capital to 1,503,948,690, divided into 100,263,246 shares of 15 each. Article 6 Share capital The share capital is set at 1,503,948,690, divided into 100,263,246 shares of 15 each, all of the same class. Article 8 Changes in share capital The share capital may be increased or reduced pursuant to a collective decision of the Shareholders. The Shareholders may delegate to the Board of Directors the powers necessary for the purpose of increasing the capital in one or several operations, within the statutory time limit, laying down the terms of such increase, recording the completion thereof and making the related amendments to the Company's by-laws. In the event of a capital increase by the issue of shares to be subscribed in cash, a preferential right to subscribe for such shares shall be reserved for owners of existing shares, under the statutory conditions. However, Shareholders may individually waive their preferential right and the decision to increase the capital may withdraw this preferential right in compliance with statutory conditions. The Shareholders may also authorise the Board of Directors to reduce the share capital. Preference shares without voting rights may be used under the conditions laid down by law. The Company may demand the buy-back either of all these shares or some classes thereof, with each class being determined by the date it was issued. 5

6 Article 9 Paying up of shares 1. Any subscription of shares in cash during the Company's life must be accompanied by the payment of at least one quarter of the par value of the shares subscribed for and, where applicable, the issue premium in full. The remainder shall be payable in one or several instalments at the times and in the proportions specified by the Board of Directors or by any ordinary collective decision of the Shareholders. Shareholders shall be informed of calls for funds at least ten (10) days before the time laid down for each payment, either by letter sent by recorded delivery with advice of receipt (lettre recommandée avec accusé de réception), by ordinary letter delivered personally in exchange for a receipt issued by the addressee, or by a notice published in a legal advertisement newspaper in the place of the registered office. 2. If the shares have not been paid up at the end of the time period laid down by the Board of Directors or by the ordinary collective decision of the Shareholders, the sums payable shall automatically bear interest for late payment, without any application to a court or formal notice being required. This interest shall be calculated on a daily basis as from the date the sum was payable, at the statutory interest rate plus two points. If the amounts payable on certain shares have not been paid up within the time laid down in the call for funds, the Company may sell the shares, under the conditions laid down by the law and the regulations, one (1) month after special and individual formal notice has been sent to the defaulting Shareholder by letter sent by recorded delivery with advice of receipt or by ordinary letter delivered personally in exchange for a receipt issued by the addressee. At the end of a time period of thirty (30) days as from the formal notice provided for above, shares which have not been paid up by the amounts payable shall cease to give [the holder] the right to participate in collective decisions of the Shareholders and shall not be counted when the quorum is calculated. The right to dividends and the preferential subscription right shall be suspended. If the Shareholder pays the amounts owed, both principal and interest, he/she/it may request the payment of dividends that are not time-barred, but he/she/it may not bring an action on the grounds of the preferential right to subscribe to an increase in capital after the period during which this right can be exercised has expired. The Company may also bring an action personally against the defaulting Shareholder and, where applicable, against previous owners of shares that have not been paid up, either before or after the sale or at the same time as the sale. Article 10 Form of securities Shares must be in registered form. Ownership of the shares shall be the result of the registration thereof in the name of their holder(s) in accounts kept for that purpose by the Company under the conditions and in accordance with the terms laid down by law. Certificates of registration in such accounts shall be validly signed by the Chairman of the Company or by any other person delegated by the Chairman for this purpose. 6

7 Article 11 Transfer and indivisibility of shares I. Definition For the requirements of this article 11, the following terms and expressions shall have the following meanings: The term "Transfer" refers in particular, without it being possible for this list to be deemed to be exhaustive, to: (i) sales or transfers, even if this is by public auction or pursuant to a court decision or the transfer of title is delayed, (ii) sales or transfers, in any form whatsoever, in particular gifts [and bequests], accord and satisfaction (dation en payment), exchange, partition, loan of securities, sale with a repurchase option, contribution to a company, partial contribution of assets, liquidation, merger or demerger, and (iii) sales or transfers relating to title, bare title, beneficial ownership of any rights derived from a transferable security or giving a right thereto, including any right to vote or to receive dividends or any other separation of the attributes of ownership of any transferable security. The term "Securities" refers to all shares and any other transferable securities issued to represent a portion of the Company's capital or that entitle [the holders thereof] to its profits, assets, reserves or any liquidation surplus or that entitle [the holders thereof] to voting rights, and any other transferable securities that could give [the holders thereof] the right, by conversion, exchange, redemption, presentation of a warrant or by any other way, to be allocated one or several of the transferable securities listed above. This term also includes any right to be allocated said transferable securities and any rights to subscribe to an increase in the Company's capital in cash or to any other issue of said transferable securities. "Group Member" refers to all companies of which more than 50% is held or controlled directly or indirectly by Vallourec and/or its subsidiaries as defined by law. II. Form of the transfer To be binding on the Company and third parties, the Transfer of shares shall take place by transferring them from the transferor s account to the transferee s account, upon submission of a share transfer form. The share transfer form shall be recorded in a register kept in chronological order called the "Share transfer register". The Transfer by a Shareholder of Securities issued by the Company, in any way whatsoever and at any time, shall be subject to the Preemptive Rights of each of the other Shareholders (the "Preemptive Right") under the conditions set out below. If the Preemptive Rights are not exercised, any transfer excluded from the scope of Title III below must be made subject to the right of approval provided for in Title IV below. 7

8 III. Preemptive Right A. Prior notification Any Shareholder (the "Transferor") considering transferring Securities issued by the Company (the "Relevant Securities") must simultaneously give each of the other Shareholders (the "Beneficiaries") notice of this, by instrument served by a process server (acte extrajudiciaire), by letter sent by recorded delivery with advice of receipt (lettre recommandée avec demande d'avis de réception) or by ordinary letter delivered personally in exchange for a receipt issued by the addressee. In this notice, the Transferor must state the number and type of Securities whose Transfer is being contemplated, the price offered in good faith per Security, the nature and terms of payment, the terms and conditions of the proposed Transfer, the time required for it to be carried out, the name and address of the person or entity offering to acquire the Securities (the "Transferee"), and the name and address of the person (persons) or entity (entities) that ultimately controls the Transferee. The notice should also specify the financial or other links, both direct and indirect, between the Transferor and the Transferee. This notice (hereinafter the "Notice"), which must be countersigned by the Transferee, shall constitute an unconditional and irrevocable offer to transfer [the Securities] at the price and under the conditions referred to in the Notice, in accordance with the following terms and conditions and subject to the following provisions. B. Exercising the Preemptive Right Each Beneficiary shall have thirty (30) days as from his/her/its receipt of the Notice (the "Time Allowed") to give notice in writing of his/her/its offer to purchase (the "Purchase Offer") all, and no fewer than all, the Relevant Securities at the price and under the terms and conditions stipulated in the Notice, subject only to a possible reduction of the right to purchase under the conditions described in article 11.III.D below. The Purchase Offer must be unconditional and irrevocable and must be sent to the Transferor before the Time Allowed ends, with a copy to the Company. Any Purchase Offer which does not meet the conditions set out above shall be deemed to be null and void. A Beneficiary having thus validly sent an Purchase Offer shall be referred to hereinafter as a "Beneficiary Purchaser". C. Price of the Offer Unless the price proposed in good faith by the Transferee is exclusively in cash, the Beneficiary Purchaser should specify in his/her/its Purchase Offer the cash amount he/she/it is prepared to pay to purchase the Relevant Securities and that he/she/it considers is equivalent to the price offered by the Transferee (the "Price Offered in Cash"). The Transferor shall inform each Beneficiary Purchaser in writing whether he/she/it accepts this valuation or not. If the Transferor fails to answer within eight (8) days following receipt of the Purchase Offer, this shall constitute a rejection of this valuation. If the Transferor has rejected the Price Offered in Cash proposed by a Beneficiary Purchaser, the price to be paid by the Beneficiary Purchaser (the "Preemption Price") shall be determined by an expert appointed in accordance with the provisions of Section of the 8

9 French Code Civil, with half of the expert's fees being borne by the Transferor and the other half by the Beneficiary Purchaser. If the Preemption Price is determined by means of an expert appraisal under the conditions defined in this article 11.III.C, each Beneficiary Purchaser may withdraw his/her/its Purchase Offer, provided that he/she/it informs the Transferor and the other Beneficiary Purchasers thereof, by letter sent by recorded delivery with advice of receipt or by ordinary letter delivered personally in exchange for a receipt issued by the addressee, within five (5) working days following the date on which he/she/it was informed of said price. This decision by one or several Beneficiary Purchasers shall not prevent the Transfer of the Relevant Securities to the Transferee in accordance with the provisions hereof. If the Beneficiary Purchaser decides to withdraw his/her/its Purchase Offer, he/she/it shall bear all the cost of the expert appraisal. If several Beneficiary Purchasers decide to withdraw, this cost shall be divided between them in proportion to the number of Relevant Securities that they would have received if none of them had decided to withdraw. In all other cases (i.e. when the price proposed in good faith by the Transferee is in cash), the Preemption Price shall be the price shown in the Notice. D. Division of the Relevant Securities between Beneficiary Purchasers If there are several Beneficiary Purchasers, each of them shall be deemed to be the purchaser of, shall obtain the transfer in his/her/its favour and shall pay the price of a number of Relevant Securities that is equal to the number of Relevant Securities multiplied by a fraction having (x) as its numerator, (x) being the number of Company shares held by this Beneficiary, and (y) as denominator, (y) being the total number of Company shares held by all the Beneficiaries having sent a final Purchase Offer. Fractions of shares shall be allocated on the basis of the highest remainder method (répartis au plus fort reste). E. Completion of the sale The transfer of the Relevant Securities to the Beneficiary Purchaser and the payment of the Price of the Purchase Offer shall take place at the latest on the last working day of the calendar month following (i) the sending of the Purchase Offer or (ii) the date of the final determination of the price of the Purchase Offer in accordance with the provisions of article 11.III.C above, with the last of these two dates being used (hereinafter the "Completion Date"). However, if, on a Completion Date as defined above, a French or EU regulation requires the performance of a prior formality in order for the Relevant Securities to be purchased, such as an application for approval or a making a declaration, the date of transfer of the Relevant Securities and the payment of the Preemption Price may be postponed. However, this date may not be more than three (3) months after the Completion Date. In such case, provided that [the reason for this delay] is not attributable to one of the Beneficiaries, the Transferor or the Company, such as not answering a request by the authorities, failing to reply or to obtain authorisation, any refusal or other action or failure to act by the competent or EU authorities that prevents the acquisition of the Relevant Securities by this Beneficiary within the abovementioned three (3) month period shall automatically and without any formality have the effect that this Beneficiary shall be deemed not to have 9

10 validly sent the Purchase Offer and the provisions of article 11.III.F below shall apply. F. Cases in which the Transferor may complete the Transfer to the Transferee If no Purchase Offer has been validly sent (or if all the Beneficiary Purchasers either are deemed not to have validly sent the Purchase Offer pursuant to article 11.III.B or have withdrawn their offers under the conditions provided for in article 11.III.C), the Transferor shall be free to transfer the Relevant Securities to the Transferee identified in the Notice, subject to the provisions of Title IV below. The Transfer shall take place on condition that the Transfer is completed at the price and under the conditions stipulated in the Notice and that it takes place no later than within sixty (60) days after the date on which the Notice was received by the Beneficiary who was the last Beneficiary to receive it. Any change in the price or in the terms and conditions set out in the Notice and any decision to transfer [the Relevant Securities] after the abovementioned deadline shall constitute a new offer subject to the Beneficiaries Preemptive Rights in accordance with the terms hereof. G. Liens Pledges and forced transfers - Transfers in breach hereof 1. In the case of the forced Transfer of Securities issued by the Company, including as a result of the enforcement of a pledge or following an attachment measure, unless this pledge has been previously approved by all the Shareholders, and also in the case of the acquisition of Securities other than in strict compliance with the provisions hereof, any Shareholder may substitute him/her/itself for the purchaser (hereinafter the "Purchaser") under the following conditions. 2. For this purpose, the Chairman must inform the other Shareholders (hereinafter the "Beneficiaries") of the Transfer, within a period of ten (10) days following the Company's receipt of the request for the registration of the Transfer to the Purchaser's account, by letter sent by recorded delivery with advice of receipt or by ordinary letter delivered personally in exchange for a receipt issued by the addressee. The Chairman must invite each of them to state whether he/she/it wishes to purchase the Securities that are the subject of the request for registration in the Purchaser's account and enclose copies of all documents that his/her/its reasonable efforts have enabled him/her/it to obtain about the Purchaser and on the conditions of the Transfer. 3. Each of the Shareholders may purchase the Securities now owned by the Purchaser and all other Company securities which may have been acquired other than in strict compliance with the provisions hereof. In this case: a) the provisions of article 11.III above shall apply without any changes, as if the Purchaser were the Transferor and as if the Securities transferred to the Purchaser at the end of the procedure or disregarding these provisions were the Relevant Securities; b) the Time Allowed shall run as from the date of receipt of the notice received pursuant to article 11.III.G.2; and c) the price shall be determined by mutual agreement or, failing this, in accordance with the provisions of article 11.III.C. 10

11 The Purchaser may not exercise his/her/its non-pecuniary rights as long as his/her/its Securities may be purchased by one of the Beneficiaries. 4. In any event, each of the Shareholders undertakes to immediately inform the Company and each of the other Shareholders if the Securities that he/she/it owns in the Company are the subject of a lien, an attachment measure or a claim of any kind whatsoever. IV. Right of approval a) A Shareholder planning to transfer his/her/its shares shall notify the Company of the Transfer by instrument served by a process server, by letter sent by recorded delivery with advice of receipt or by ordinary letter delivered personally in exchange for a receipt issued by the addressee, stating the first name(s), last name, address and nationality of the Beneficiary or Beneficiaries of the Transfer, the number of shares the Shareholder is contemplating transferring and the price offered, if it is a Transfer for valuable consideration. The Board of Directors shall decide on the approval requested and shall give notice of its decision by instrument served by a process server, by letter sent by recorded delivery with advice of receipt or by ordinary letter delivered personally in exchange for a receipt issued by the addressee, within three (3) months following notification of the request for approval. Failure to answer within this time period shall be the equivalent of notification of approval. No reason need be given for the Board of Directors' decision and, if the request is rejected, this may not give rise to any claim. If the proposed Transferee or Transferees is/are approved, the Transfer to the Transferee or Transferees shall be recorded upon the submission of supporting documents, which must be handed over within the month that follows the notification of the Board of Directors' decision to approve, failing which a further approval procedure shall be required. b) In the event the proposed Transferee or Transferees is/are not approved, the Transferor shall have eight days as from notification of the refusal to approve the Transferee or Transferees in which to inform the Board of Directors, by letter sent by recorded delivery with advice of receipt, by instrument served by a process server or by ordinary letter delivered personally in exchange for a receipt issued by the addressee, that he/she/it is abandoning the planned Transfer. If the applicant has not expressly abandoned the planned Transfer under the conditions provided for above, the Company shall be required to arrange for the purchase of the shares at a price determined in exactly the same way as stated in the provisions of article 11-III.C above, either by the Shareholders or by a duly approved third party, in accordance with this article. c) With the consent of the Shareholder wishing to transfer his/her/its shares, the Company may also redeem the shares with a view to a reduction in capital. In the absence of agreement between the parties, the redemption price shall be determined under the conditions provided for in article of the French Code Civil. d) If all the shares have not been redeemed at the end of a three-month period as from the notification of the refusal of approval, approval shall be considered 11

12 to have been given. However, this three-month period may be extended by a court decision at the Company's request. e) In the event of an increase in capital by means of issuing cash shares, transfers of subscription rights in any way whatsoever shall only be valid if they are to persons or entities with regard to which the Transfer of shares is unrestricted pursuant to paragraph V below. V. Unrestricted Transfers The following Transfers are not restricted by the foregoing provisions and are exempt from any prior notification, regardless of the date of such Transfers: (a) Transfers that have been previously approved in writing by all the Shareholders, (b) Transfers by a Shareholder to any Group Member, with this term referring to all companies of which more than 50% is held or controlled directly or indirectly by Vallourec and/or its subsidiaries as defined by law, (c) Transfers between Shareholders. VI. Other provisions a) Holders [of shares], intermediary transferees and subscribers shall be jointly and severally liable for the amount of the share that has not been paid up. Any subscriber or Shareholder who has transferred his/her/its shares shall cease to be liable for payments not yet called two years after sending the transfer order. b) Shares shall be indivisible with regard to the Company. c) Whenever it may be necessary to own several existing shares to be able to exercise any right whatsoever and in particular to exercise the Preemptive Right provided for above, or in the event of an exchange or the allocation of securities from an operation such as a reduction of capital, increase of capital by incorporating reserves, stock split or reverse split, merger, etc. giving the right to a new security in exchange for several existing shares, single Securities or Securities in a smaller number than that required shall not give their holders any rights against the Company. Shareholders shall be personally responsible for bringing together and, possibly, for buying or selling the number of Securities required. d) Heirs, creditors, beneficiaries or other representatives of a Shareholder may not, under any pretext whatsoever, cause seals to be placed on the Company's property or documents, request the sharing or the public sale of property held in common (licitation) or interfere in the Company's management. In order to exercise their rights, they shall rely on the Company's statements of assets and liabilities and collective decisions. e) In the event of a change within the meaning of Section L of the French Code de Commerce relating to the control of an affiliate (other than a company in the same group), said affiliate shall inform the Company thereof by letter sent by recorded delivery with advice of receipt to the Chairman within 60 days of the change of control. This notice of change must include the date of the change of control and complete information on the new controlling party/parties. 12

13 The Board of Directors shall decide whether to approve the change of control within 60 of receipt of said letter and shall notify the Shareholder thereof 10 days after the decision has been taken. In the event of failure to comply with this notification procedure, the affiliate subject to a change of control may be excluded by the Company. The Board of Directors shall decide whether to exclude it or not after it has become aware, by any means, of such change of control in 427 days (one year and two months) after said change of control and shall notify the Shareholder thereof 10 days after the decision has been taken. The Shareholder or its representative, invited to said meeting under the terms of Article 21, may, at its express request, attend the meeting at which said decision is taken. All the shares of the excluded Shareholder must be transferred within 60 days of the decision to exclude it to any designated person as provided for in Title III Preemptive right. The price at which the excluded Shareholder s shares shall be purchased shall be set by mutual agreement, or, failing this, by an expert under the conditions laid down in Section of the French Code Civil. If the Company does not carry out the exclusion procedure within the above time, it shall be deemed to have approved the change of control. The foregoing provisions shall apply to a company that becomes an affiliate following a merger, demerger, contribution or dissolution. Article 12 - Chairman TITLE III ADMINISTRATION OF THE COMPANY Chapter I - Chairman The Company shall be run and administered by a Chairman, who shall be chosen from amongst the members of the Board of Directors and who may be a natural or legal person and who may but need not be a Shareholder of the Company. When a legal person is appointed Chairman, the corporate officers of said legal entity shall be subject to the same terms and obligations and shall incur the same civil and criminal liability as if they were appointed Chairman in their own name, without prejudice to the joint and several liability of the legal entity under their management. If the legal person files for insolvency or is subject to court-ordered liquidation proceedings, this shall end the Chairman's duties. During the life of the Company, the Chairman shall be appointed by a decision of the Board of Directors. The Chairman's term of office shall be the same as his/her/its office as a director, unless the Board of Directors decides otherwise. The Chairman may resign provided he/she/it gives the Company three (3) months' notice of this decision. The Chairman may be removed from office by a court decision or by a decision of the Board of Directors. An individual over 65 years of age may not be appointed Chairman. If the Chairman reaches this age, he/she shall be deemed to have resigned automatically following the 13

14 ordinary collective decision of the Shareholders that approves the financial statements for the financial year in which he/she reaches this age. Article 13 Chairman's powers The Chairman shall be responsible for the general management of the Company. The Chairman shall be vested with the most extensive powers to act in the Company s name and on its behalf in all circumstances. The Chairman shall represent the Company in its relations with third parties. In such relations with third parties, the Company shall be bound even by actions of the Chairman which do not fall within the Company's object, unless it can prove that the third party knew that the action fell outside the scope of said object, or could not fail to be aware of such fact, given the circumstances. In the context of the internal organisation of the Company, the Chairman's powers may be limited by an ordinary collective decision of the Shareholders. All deeds and undertakings relating to the Company, of any kind whatsoever, shall be validly signed by the Chairman or by any person specifically authorised for that purpose, each acting within the limit of his/her/its powers. Article 14 - Chief operating officer(s) On the basis of a proposal by the Chairman, the Board of Directors may appoint one or several natural persons as chief operating officer(s) (directeur général). The length of the person's or persons' term of office shall be set in this decision. The chief operating officer(s) may be removed from office at any time by a decision of the Board of Directors on the basis of a proposal by the Chairman or by a Director. In the event the Chairman dies, resigns or is removed from office, the chief operating officer(s) shall remain in office until the appointment of a new Chairman. The Board of Directors shall determine, in agreement with the Chairman, the scope of powers delegated to the chief operating officer(s). Failing this, the chief operating officer(s) shall have the same powers as the Chairman. The chief operating officer(s) shall represent the Company in its relations with third parties. A person may not be appointed as a chief operating officer if he/she is more than 65 years of age. If a chief operating officer reaches this age, he/she shall be deemed to have resigned automatically following the ordinary collective decision of the Shareholders that approves the financial statements for the financial year in which he/she reaches this age. Article 15 - Remuneration of the Chairman and of the chief operating officer(s) The remuneration of the Chairman shall be set in the decision which appoints him/her/it or by a commission or a committee created especially for this purpose. It may be fixed or proportional or both fixed and proportional. In addition, the Chairman shall be entitled to be reimbursed for travel and entertainment expenses he/she/it incurs, on the basis of supporting documents. This shall also apply to the remuneration of the chief operating officer(s). 14

15 Chapter II - Board of Directors Article 16 Appointment of members of the Board of Directors 1. The Board of Directors shall consist of at least three and no more than 12 members, who may but need not be Shareholders, and who shall be appointed by a collective decision of the Shareholders. 2. Legal persons may be members of the Board of Directors. When they are appointed, legal persons must appoint a permanent representative who shall have the same responsibilities as if he/she were a member of the Board of Directors in his/her own name, without prejudice to the liability of the legal person he/she represents. Article 17 - The Board of Directors' powers The Board of Directors shall determine the guidelines for the Company's activity and check that they are implemented. Subject to the powers expressly granted to General Meetings of Shareholders and to the Chairman, and within the limits of the Company's object, it shall review any question involving the proper operation of the Company and shall decide in its deliberations on matters which involve said proper operation. The Board of Directors shall make the controls and checks that it considers advisable. Each Director shall receive all the information required to perform his/her/its duties and may obtain any document he/she/it shall consider useful. In addition, the Board may grant one of its members or a third party, who may but need not be a Shareholder, all special authorisations for one or several specific purposes, with or without the possibility for said authorised representatives to further delegate in whole or in part. It may also decide to create committees responsible for examining the questions referred by itself or the Chairman for review. Article 18 Term of office of members of the Board of Directors 1. The term of office of members of the Board of Directors shall be six (6) years. It shall end following the ordinary collective decision of the Shareholders approving the financial statements for the previous financial year and taken in the year in which the term of office of the member in question expires. 2. Any outgoing member shall be eligible for re-election. 3. They may be removed from office ad nutum by a collective decision of the Shareholders. Removal from office cannot give rise to damages. 4. The number of members of the Board of Directors over the age of seventy (70) may not exceed one third of the members in office. Any appointment contrary to this provision shall be invalid. When this limit has been exceeded, the oldest member shall be deemed to have resigned automatically. 15

16 Article 19 Possibility of provisional appointments 1. If a seat on the Board of Directors falls vacant between two collective decisions of the Shareholders due to the death or resignation [of a Director], the Board may provisionally replace said Director. 2. If only two members of the Board of Directors remain in office, the Board shall nonetheless remain validly formed. However, the next ordinary collective decision of the Shareholders shall appoint a third member such that the Board of Directors shall have at least three (3) members. 3. The member of the Board of Directors appointed to replace another shall only remain in office for the remainder of his/her/its predecessor's term of office. 4. Provisional appointments of members of the Board of Directors shall be subject to ratification by the next collective decision of the Shareholders. If the appointments are not ratified, the decisions taken and the acts carried out previously by the Board of Directors shall nonetheless remain valid. Article 20 Chairman and officers of the Board 1. The Board of Directors shall be chaired by a Chairman who shall perform his/her/its duties throughout his/her/its term of office as Chairman. 2. If the Chairman is not present at a meeting the Board shall appoint one of the members present to chair the meeting. 3. The Board may also appoint a Secretary who may but need not be a member of the Board and may but need not even be a Shareholder. 4. The Chairman and the Secretary shall always be eligible for re-election. Article 21 - Board of Directors' decisions 1. The members of the Board of Directors shall meet as often as required in the Company's interests. Such meetings shall be convened by the Chairman or by onethird of its members, or by the Secretary of the Board who is given power of attorney by the Chairman (limited to 3 years), either at the registered office or at any other place named by the person who convened the meeting. Decisions may be taken by means of teleconferencing (by telephone or audio-visual means ). This provision shall not apply to the approval of the annual financial statements, the appointment of the Chairman or temporary appointment (mandatory presence). The Chairman may grant a power of attorney to the Secretary of the Board of Directors to convene a meeting. This power of attorney shall be limited to three years and no details about the purpose of the meetings to be convened need be given. 2. Meetings shall be convened at least six (6) days in advance by any means. The members of the Board of Directors may however meet validly regardless of the method or the time in which the meeting was convened provided all Board members are present at the meeting or the teleconference in question and provided they formally agree to the holding of such meeting or teleconference or have previously granted a power of attorney. Any party convening a meeting, even if delegated to do so or having received a power of attorney, may postpone for three months the date of said meeting with the same agenda.. 16

17 3. A member of the Board of Directors may authorise another member of the Board of Directors to represent him/her/it at a Board of Directors' meeting by letter, fax, or telegram. Each member of the Board of Directors may only represent two (2) other members of the Board of Directors. 4. The effective presence of at least half the members of the Board of Directors at the meeting or the teleconference is required for the decisions to be valid. An attendance register shall be kept at the registered office which shall be signed by all the members of the Board of Directors who participate in each Board of Directors' meeting. 5. Decisions shall be taken by a majority of the members present at the meeting or having participated in the teleconference. In the event of a tie, the Chairman of the meeting shall have the casting vote. 6. Decisions shall be recorded in minutes, inserted in a special register and signed by the Chairman and at least one other member of the Board of Directors. If the Chairman is unable to act, the minutes shall be signed by at least two members of the Board of Directors who participated in the meeting or the teleconference. Copies or excerpts from these minutes shall be validly certified by the Chairman of the Company, the Secretary of the meeting or an agent (fondé de pouvoir) authorised for this purpose. 7. Every year, the members of the Board, will voluntarily give the Chairman a list of all the other Boards of which they are members as corporate officers. 8. The members of the Board of Directors, and any other person attending meetings of the Board of Directors, shall be bound by a duty of discretion as regards the decisions of the Board as well as regards information that is confidential or is described as such by the Chairman. Article 22 - Remuneration of the members of the Board of Directors Independently of exceptional remuneration which may be allocated to them for special assignments, members of the Board of Directors may receive attendance fees. The amount of such attendance fees, which shall be set by a collective decision of the Shareholders, shall be maintained until a decision to the contrary. The Board or the Chairman of the Board shall divide these attendance fees among the Board's members as he/she/it sees fit. Article 23 - Works Council delegates The works council representatives shall exercise the rights specified by Article L of the French Employment Code vis-à-vis the Chairman. To this effect, the company s Chairman shall arrange periodic meetings with the works council representatives. He shall set the frequency of such meetings and the agenda on the basis of matters requiring attention at the time. The Chairman shall advise the works council representatives of the meetings he plans to hold by all means at his disposal. The Chairman shall convene meetings of the works council representatives in particular when decisions need to be taken concerning: - the drafting of the company s financial statements and annual management report; - variations of the share capital; 17

18 - a change of company name; - changes to the financial year. Article 24 - Statutory Auditors TITLE IV AUDITING [THE COMPANY] The Company shall be audited by one or several Statutory Auditors who shall have the duties and the powers granted to them by law. One or several Alternate Statutory Auditors, called on to replace the Statutory Auditor in the event of its refusal or inability to act, resignation, death or removal from office, shall be appointed at the same time as the Statutory Auditor(s) and for the same term of office. The Statutory Auditor(s) shall be appointed by an ordinary collective decision of the Shareholders. The Statutory Auditors shall be appointed for six (6) financial years. TITLE V COLLECTIVE DECISIONS OF THE SHAREHOLDERS Article 25 General rules 1. When the Company has only one Shareholder, the Sole Shareholder shall exercise the powers granted by law to the Shareholders as a whole. A Sole Shareholder may not delegate his/her/its powers. His/her/its decisions shall be recorded in a register. 2. If there is more than one Shareholder, collective decisions of the Shareholders shall be taken when requested by the Chairman of the Company or by the Board of Directors or by one or several Shareholders owning at least one tenth of the capital: (i) (ii) either at a General Meeting held at the registered office or at any other place named in the notice of meeting, by means of a written consultation, (iii) or by means of an instrument signed by all the Shareholders. Any Shareholder shall have the right to participate in collective decisions, regardless of the number of shares he/she/it owns. All Shareholders must provide proof of their identity and of the registration of their shares in their accounts on the day of the collective decision. Each share shall entitle [the holder thereof] to one vote. The voting right attached to shares shall be proportional to the capital they represent. The Statutory Auditor(s) shall be invited to participate in any collective decision at the same time and in the same way as the Shareholders. This shall also apply to the Chairman of the Company if he/she/it is not a Shareholder. 18

19 The Chairman may grant a power of attorney to the Secretary of the General Meeting to convene a meeting. This power of attorney shall be limited to three years and no details about the purpose of the [meetings to be] convened need be given. Any party convening a meeting, even if delegated to do so or having received a power of attorney, may postpone for one month the date of said meeting with the same agenda. In this case, the requisite time period between the notice and the meeting shall be reduced to six days. a. Decisions in General Meetings of Shareholders General Meetings shall be convened by the person or persons who have taken the initiative to request a collective decision at least eight (8) days in advance by an ordinary letter sent to all Shareholders or, subject to obtaining their individual agreement containing their address, by to this address. Each Shareholder may at any time ask the Company, by letter sent by recorded delivery with advice of receipt or by ordinary letter delivered personally in exchange for a receipt issued by the addressee, to replace the above-mentioned system of sending an ordinary letter or in future by a system of letters sent by recorded delivery with advice of receipt or ordinary letters delivered personally in exchange for a receipt issued by the addressee. If a General Meeting cannot take valid decisions due to the lack of the required quorum, a second General Meeting shall be convened in the same way as the first and the notice of meeting shall reiterate the date of such [first] meeting. However, the requisite time period between the notice and the meeting shall be reduced to six (6) days. Any General Meeting that has been improperly convened may be cancelled. However, action to cancel the General Meeting shall not be admissible where all the Shareholders were present or represented at the General Meeting. The notice of meeting must contain the date, the time and the place of the General Meeting and the agenda of the General Meeting. The agenda of the General Meeting and the text of the resolutions shall be drawn up by the author(s) of the notice of meeting. However, one or several Shareholders representing at least ten per cent (10%) of the capital may require draft resolutions to be included on the agenda, by letter sent by recorded delivery with advice of receipt sent to the registered office at least 20 days before the date of the General Meeting. The request shall be accompanied by the text of the draft resolutions and a brief statement of the reasons [for submitting such request]. The Chairman shall acknowledge receipt of the draft resolutions by letter within five days as from such receipt. These draft resolutions must be included on the agenda and put to the vote of the General Meeting. A General Meeting may not discuss a question which is not on its agenda. However, it may remove one or several members of the Board of Directors from office and replace them at any time. It may also remove the Chairman from office. 19