TRANSLATION OF PRODUCT SUPPLY AND SALES SERVICES FRAMEWORK AGREEMENT (2017-2019) Product Supply and Sales Services Framework Agreement (2017-2019) Between Sinopec Shanghai Petrochemical Company Limited And China Petroleum & Chemical Corporation China...

Exhibit 4.1

TRANSLATION OF PRODUCT SUPPLY AND SALES SERVICES FRAMEWORK

AGREEMENT (2017-2019)

Product Supply and Sales Services Framework Agreement (2017-2019)

Between

Sinopec Shanghai Petrochemical Company Limited

And

China Petroleum & Chemical Corporation

China Petrochemical Corporation

Table of Contents

I		Background
II		Agreement
		Article 1: Scope of Products and Services
		Article 2: Transaction Principle
		Article 3: Pricing Principle
		Article 4: Operation Methods
		Article 5: Rights and Obligations of the Parties
		Article 6: Term, Termination of Specific Products or Services Contracts
		Article 7: Representations and Warranties of the Parties
		Article 8: Force Majeure
		Article 9: Publicity
		Article 10: Miscellaneous
		Article 11: Notice
		Article 12: Governing Law and Dispute Resolution
		Article 13: Definitions and Interpretations
		Article 14: Supplementary Provisions

Product Supply and Sales Services Framework Agreement

This agreement (this “Agreement”) is entered into on August 23, 2016 by and between the following parties:

Party A:		Sinopec Shanghai Petrochemical Company Limited, a joint stock limited company duly incorporated and validly existing under the laws of China.
Party B (1) :		China Petroleum & Chemical Corporation, a joint stock limited company duly incorporated and validly existing under the laws of China.
Party B (2)		China Petrochemical Corporation, a state-owned enterprise duly incorporated and validly existing under the laws of China.
Party B(1) and Party B (2) are collectively called Party B. Party A and Party B are collectively called “the parties”.

I Background

Party A is a joint stock company listed both domestically and offshore while Party B(1) is the direct controlling shareholder of Party A, Party B (2) is the actual controller of Party A. Party A engages in the production and operation of petrochemical products, and Party B undertakes the production and operation of petroleum gas and petrochemical products. It is necessary for Party A and Party B to provide their respective products and services to the other party. Based on the above, the parties agree to enter into this Agreement and warrant that they will cause their respective subordinated enterprises and units (including the subsidiaries, branches and other units subordinating to the parties) to provide such products and services as specified in this Agreement in accordance with the terms and spirits hereof.

This Agreement, entered into in the ordinary course of business of the parties, has been reached through negotiations on an arm’s length basis, and the transactions contemplated under this Agreement shall be conducted in the ordinary course of business of both Party A and Party B.

II Agreement

Article 1: Scope of Products and Services

The products and services to be supplied to the other party under this Agreement by Party A and Party B, respectively, include:

		1.1		The products and services to be supplied by Party A to Party B(1) include:
				1.1.1		Petroleum products and petrochemical products
						Party A shall sell to Party B petroleum products, including gasoline, diesel, jet fuel, liquefied petroleum gas and etc and petrochemical products, including Butadiene, Benzene, PX, EG and etc.
				1.1.2		Property leasing service
						Party A shall lease properties to Party B.

		1.2		The products and services to be supplied by Party B to Party A include:
				1.2.1		Raw materials
						Party B shall provide Party A with raw materials, including crude oil, naphtha, ethylene and other chemical raw materials as well as other raw materials and supplies.
				1.2.2				Sales service
								Party B(1) shall provide Party A with agency sales service covering products like resins, synthetic fibers, synthetic fiber monomers and polymers, intermediate petrochemical products and by- products from ethylene cracking and aromatic plants and other substandard products related to the above five products.
				1.2.3				Assets leasing service
								Party B shall lease oil tanks and other storage and transmission facilities to Party A.
Article 2: Transaction Principle
		2.1		Party A and Party B agree that under the same sale conditions, both parties shall give priority to purchase the products and services of the other.
		2.2		The specific parties to any transaction relating to the products and services under this Agreement may, to the extent permitted by this Agreement, enter into separate contracts. For the purpose of this Article 2.2, such specific parties to the transaction refer to Party A and Party B as well as their respective subordinated enterprises and units.
Article 3: Pricing Principle
The pricing of (i) petroleum products, petrochemical products and (ii) the sales and purchase of the raw materials shall be determined according to the general principle and order as follows: where there are Government Fixed Prices, such Government Fixed Prices shall apply; where there is no Government Fixed Price, but there are Guidance Prices, such Guidance Prices shall apply; where there is neither applicable Government Fixed Price nor Guidance Price, the Market Prices (including the bidding prices) shall apply. The prices of the sales service hereunder shall the actual sales amount multiplying the applicable market commission rate. The prices with respect to the property leasing service hereunder shall be decided with reference to the market prices applicable to the property to be leased.
Article 4: Operation Method
		4.1		The parties shall, prior to October 31 of each year, provide to the other party their respective demand plan regarding the products and services to be obtained from the other party for the next year (the “Demand Plan”) and shall, prior to November 30 of each year, provide to the other party their respective supply plan regarding the products and services to be furnished to the other party for the next year (the “Supply Plan”).
		4.2		Party A and Party B shall ensure and cause their respective subordinated enterprises or units to, in accordance with the Supply Plan as confirmed by the parties, enter into specific products or services contracts in consistence with the principles and provisions hereof.
		4.3		During the implementation of this Agreement, adjustments may be made to the Demand Plan and Supply Plan and specific products or services contracts when necessary and with the consents of both Party A and Party B.
Article 5: Rights and Obligations of the Parties
		5.1		The parties shall have the rights to:
				5.1.1		choose to provide a third party with products and services if the supply of the products and services to the other party pursuant to the provisions hereof is guaranteed;

				5.1.2		prepare the annual Demand Plan and Supply Plan and make any adjustment thereto at its discretion provided that there will be no violation of Article 4; and
				5.1.3		lawfully collect payments for goods and service fees in accordance with this Agreement.
		5.2		The parties shall be obligated to:
				5.2.1		cause and ensure that their respective subordinated enterprises or units provide products and services to the other party in accordance with the standards and pricing as provided in this Agreement and relevant specific products or services contracts;
				5.2.2		be entrusted by the parties to relevant specific products or services contracts to coordinate matters relating to such specific products or services contracts;
				5.2.3		appoint or establish special organizations to be responsible for liaison, document preparation, planning and arrangement, balance-keeping between supply and demand, supervision of the performance of the contracts and coordination in connection with transactions involving relevant products and services under this Agreement; and
				5.2.4		pay the purchase prices and service fees in accordance with the provisions contained in this Agreement and relevant specific products or services contracts.
		5.3		Subject to the provisions of this Agreement, if the products and services supplied by Party B fails to meet the demands of Party A in any respect (including in quantity and in quality), Party A may choose a third party to supply the relevant products and services.
Article 6: Term; Termination of Specific Products or Services Contracts
		6.1		Any parties to any specific products or services contracts (excluding this Agreement), which are entered into in accordance with this Agreement may give the other party a written notice at least six months in advance to terminate the supply of a certain product or service, provided that Article 6.2 and 6.3 hereof is not violated. Such notice must specify the product or service and the effective date of such termination. The supply of such product or service may be terminated upon agreement by the parties after negotiation. If the supply of any product or service is terminated pursuant to this Article 6.1, such termination shall neither affect other rights or obligations of Party A or Party B under this Agreement, nor affect such other rights or obligations of any party under the specific products or services contracts that have been executed in accordance with this Agreement.
		6.2		If Party A is unable to obtain a certain product and service of Party B conveniently from a third party (including but not limited to any third party related to Party B) and Party A requires the same to be provided by Party B, then in no event may Party B terminate the supply of such product and service.
		6.3		In the event that either party has produced a termination notice to terminate the supply of a certain product or service in accordance with Article 6.1, unless otherwise agreed to by Party A and Party B, such termination notice shall not terminate or affect the parties’ obligations and liabilities arising from this Agreement and any relevant specific products or services contracts at or prior to the time of issuance of such notice.

		6.4		This Agreement, upon signatures and seals affixed by the authorized representatives of the parties and approval by the independent shareholders of Party A, shall become effective on January 1, 2017 and be valid for three years from such effective date.
		6.5		In case that either party violates any term of this Agreement (the “Defaulting Party”), the other party (the “Non-defaulting Party”) may deliver to the Defaulting Party a written notice notifying its breach of contract and requiring the Defaulting Party to make remedies within such reasonable period as designated therein. If the Defaulting Party fails to remedy such breach within such period, then the Non-defaulting Party may forthwith terminate this Agreement. The Non-defaulting Party shall reserve its rights to seek damages from the Defaulting Party and any other rights and claims as permitted by laws.
		6.6		Termination of this Agreement shall not affect any rights or obligations of any party that has already incurred.
Article 7: Representations and Warranties of the Parties
		7.1		Representations and Warranties of Party A:
				7.1.1				Party A is validly incorporated and has independent status of a corporation and a valid business license;
				7.1.2				Party A has consistently engaged in business activities in accordance with the law and has not undertaken any activities beyond its business scope as prescribed by the law;
				7.1.3				Party A has been granted with all governmental approvals (if required) and internal authorizations necessary for executing this Agreement and performing all of its obligations as contemplated hereby. The signatory to this Agreement is the authorized representative of Party A. This Agreement shall be binding upon Party A upon execution.
				7.1.4				Party A’s execution of this Agreement or performance of any of its obligations hereunder neither violates any other agreements to which it is a party or its articles of association, nor legally conflicts with such agreements or its articles of association.
		7.2		Representations and Warranties of Party B:
				7.2.1				Party B is validly incorporated and has independent status of a corporation and valid business license;
				7.2.2				Party B has consistently engaged in business activities in accordance with the law and has not undertaken any activities beyond its business scope as prescribed by the law;
				7.2.3				Party B has been granted with all governmental approvals (if required) and internal authorizations necessary for executing this Agreement and performing all of its obligations as contemplated hereby. The signatory to this Agreement is the authorized representative of Party B. This Agreement shall be binding upon Party B upon execution.
				7.2.4				Party B’s execution of this Agreement or performance of any of its obligations hereunder neither violates any other agreements to which it is a party or its articles of association, nor legally conflicts with such agreements or its articles of association.

Article 8: Force Majeure
		8.1		In the event that any party hereto fails to perform its obligations hereunder in whole or in part due to a Force Majeure Event, the performance of such obligations shall be suspended for the duration of such Force Majeure Event. A Force Majeure Event means the occurrence of any event after the execution of this Agreement which (i) is beyond reasonable control of, and could not be predicted, avoided or overcome (even though it could be predicted) by the affected party, and (ii) results in that, from an objective point of view, such party’s performance of this Agreement in whole or in part becomes impossible or impractical (including but not limited to failure to perform at reasonable expenses). Force Majeure Events include but not limited to flood, fire, drought, typhoon, earthquake, other natural disasters, traffic accident, strike, turmoil, riot, war (whether or not with a declaration) and the acts or omissions of any governmental authorities.
		8.2		The party claiming to be affected by a Force Majeure Event shall notify the other party of the occurrence of such Force Majeure Event in writing within the shortest possible time, and provide the other party with reasonable evidence for such Force Majeure Event and its duration by personal delivery or registered air mail within fifteen (15) days after the occurrence of such Force Majeure Event. The party claiming that the Force Majeure Event has caused performance of its obligations hereunder impossible or impractical from an objective point of view is obligated to use all reasonable efforts to eliminate or mitigate the impact of such Force Majeure Event.
		8.3		Upon occurrence of a Force Majeure Event, the parties shall immediately decide, through friendly consultation, on how to perform this Agreement. After termination or elimination of the Force Majeure Event or its impact, the parties shall immediately resume performance of their obligations hereunder.
Article 9: Publicity
Except with the prior written consent of the other party, neither party may make any public announcement regarding this Agreement, other than those made in accordance with PRC Laws, or as required by China Securities Regulatory Commission, Shanghai Stock Exchange, Stock Exchange of Hong Kong Limited, Hong Kong Securities and Futures Commission, New York Stock Exchange, London Stock Exchange, Securities and Exchange Commission of the United States or any other governmental authorities or regulatory organizations.
Article 10: Miscellaneous
		10.1		Except as otherwise provided herein, neither party may assign all or part of its rights and obligations under this Agreement without the other party’s written consent.
		10.2		This Agreement constitutes the entire agreement between the parties and supersedes any and all prior agreements, contracts, understandings and communications, oral or written, between the parties with respect to the subject matter hereof.
		10.3		If any provision of this Agreement becomes illegal, invalid or unenforceable, the validity and enforceability of the remainder hereof shall not be impaired.
		10.4		The parties agree that they shall, at its own cost, be responsible for any and all costs and expenditures arising out of the execution of this Agreement in accordance with relevant provisions of PRC laws. If the law does not address any costs or expenditures, such costs or expenditures shall be born by the parties equally.

		10.5		This Agreement shall not be amended except by a written agreement executed by each of the authorized representatives of the parties and with approval by the appropriate corporation actions taken by the parties.
		10.6		Except as otherwise provided herein, no failure or delay by a party to exercise any right, power or authority under this Agreement shall constitute a waiver thereof, nor shall any single or partial exercise of the same preclude the exercise of any other right, power or authority.
Article 11: Notice
		11.1		Any and all notices or other communications given by either party under this Agreement shall be in writing and in Chinese, and delivered in person or sent by registered mail to the other party at its designated address or sent to the facsimile numbers as designated by the other party. The notice shall be deemed delivered and effective on the following date:
				11.1.1				If delivered in person, the date on which the person designated by the other party has signed the receipt of the notice;
				11.1.2				If sent by registered mail, postage prepaid (subject to the date of the postmark date), on the seventh day following being posted (if the last day is Saturday, Sunday or a public holiday, on the immediately following business day);
				11.1.3				If sent by facsimile, upon the completion of transmission.
The addresses of the parties are as follows: Party A: Sinopec Shanghai Petrochemical Company Limited Domicile: Xx. 00 Xxxxx Xxxx, Xxxxxxx Xxxxxxxx, Xxxxxxxx 000000 Party B(1): China Petroleum & Chemical Corporation Domicile: 00 Xxxxxxxxxxx Xxxxx Xxxxxx, Xxxxxxxx Xxxxxxxx, Xxxxxxx 000000 Party B(2): China Petrochemical Corporation Domicile: 00 Xxxxxxxxxxx Xxxxx Xxxxxx, Xxxxxxxx Xxxxxxxx, Xxxxxxx 000000 In the event that either party changes its address, such party shall notify the other party in accordance with this Article 11 immediately.
Article 12: Governing Law and Dispute Resolution
		12.1		This Agreement shall be governed by and construed in accordance with PRC laws.
		12.2		Any dispute arising from or in connection with this Agreement shall be settled through consultation between the parties. In the event that the parties are unable to settle the matter through consultation, the matter shall be submitted by either Party A or Party B to the Beijing Arbitration Commission for arbitration in accordance with the arbitration rules of such Commission in effect at the time of submission. The arbitration award shall be final and binding upon the parties.
Article 13: Definitions and Interpretations
		13.1		In this Agreement, unless the context otherwise requires, the following words and expressions shall have the following meanings:
				13.1.1		Government Fixed Price means the price determined by the laws, regulations, determinations, orders promulgated by, or specified for certain product or service by the central government, provincial government or other regulatory body of the Peoples’ Republic of China.

				13.1.2		Guidance Price means the price that may be decided by the parties to a transaction subject to a certain range which is provided by the laws, regulations, determinations, orders promulgated by or specified for certain product or service by the central government, provincial government or other regulatory body of the Peoples’ Republic of China.
				13.1.3		Market Price for a certain product or service means the price determined in accordance with the following sequences:
						(1)    during the ordinary course of business, the price then charged by an independent third party who supplies such product or service at the place or neighboring area where such product or service is supplied; or
						(2)    during the ordinary course of business, the price then charged by an independent third party who provides such product or service.
		13.2		Except as otherwise provided herein, in this Agreement:
				13.2.1		all references to one party shall include its successors;
				13.2.2		headings hereof are inserted for convenience only and shall not have any legal effect or affect the construction of this Agreement.
Article 14: Supplementary Provisions
		14.1		This Agreement shall be written in Chinese.
		14.2		This Agreement shall be executed in Six (6) originals, each of which shall be of equal legal effect.
		14.3		IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first written above.

(The remainder is left blank intentionally.)

(Signature page to Product Supply and Services Framework Agreement)

Sinopec Shanghai Petrochemical Company Limited (Seal)

Authorized Representative (signature): Ye Guohua

China Petroleum & Chemical Corporation (Seal)

Authorized Representative (signature): Xxxxx Xxx

China Petrochemical Corporation (Seal)

Authorized Representative (signature): Xx Xxxx