DISTRIBUTORSHIP AGREEMENT

This Agreement is executed this __th day of _______________, by and between:

SDK PRESTIGE TILES INCORPORATED, a corporation

organized and existing under the laws of the Philippines, with principal
office at SDK CENTRE #153 EDSA, Wack-Wack Village, Mandaluyong
City, represented herein by KENNETH G. HING, (hereinafter to as the
“Company”);

- and -

RM GLASS SUPPLY, a corporation organized and existing

under the laws of the Philippines, with principal office at
________________________________________, represented herein by
__________________________ (hereinafter referred to as the
“Distributor”);

Witnesseth : That -

WHEREAS, the Distributor represents that it is duly licensed to engage in the

business of supplying, installing and selling glass and related products and direct selling
of merchandise to individuals and firms and that it has substantial capital in the form of
cash, tools, equipment, delivery trucks and vehicles, office and storage facilities and
manpower necessary in the conduct of this business;

WHEREAS, the Company is in the business of importing, and trading of various

types and designs of European tiles and other product lines (hereinafter collectively
referred to as the "Products");

WHEREAS, the Company and the Distributor mutually agree to enter into a
distributorship arrangement for the sale and distribution of the Products, subject to the
terms and conditions stated below;

WHEREFORE, for and in consideration of the mutual covenants and stipulations

hereinafter set forth, the parties hereto agree as follows:

ARTICLE I
APPOINTMENT AND TERRITORY

1. The Company hereby constitutes and appoints the Distributor, and the
Distributor hereby accepts the appointment, as the Company’s exclusive distributor
(except for direct accounts of the Company) in BACOLOD CITY, NEGROS
OCCIDENTAL (hereinafter referred to as the “Territory”) for the Products. As such
distributor, the Distributor shall purchase from the Company pursuant hereto for resale
the Products to be distributed by the Distributor; Provided, That, the Distributor’s
obligation to pay the Company therefor shall not be dependent on whether or not it
actually resells such Products.
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2. It is understood that the Company has the unrestricted right to sell the
Products to its direct accounts in the Territory. The Distributor shall not resell or export
any Product outside the Territory nor resell, directly or indirectly, any Product to any
third party who the Distributor knows or has reason to suspect intends to sell or export
any Product outside the Territory. The Company has the option to change, contract,
expand or withdraw the aforesaid Territory by giving thirty (30) days written notice
thereof to the Distributor.

ARTICLE II
PRODUCT CHANGES

1. The Company reserves the right, without thereby incurring any liability to
the Distributor with respect to any purchase order theretofore transmitted or placed by the
Distributor, or otherwise, and for justifiable reasons which include acts of God and/or
government, to discontinue or limit its production of any Product or to terminate or limit
deliveries of any of the Products from time to time.

ARTICLE III
PURCHASE ORDERS

1. Upon the effectivity of this Agreement, the Distributor agrees to place a

minimum purchase order of ONE MILLION PESOS (P1,000,000.00) (the term of
payment is found in Article VI of this agreement) and a total order of not less than
EIGHT MILLION PESOS (P8,000,000.00) upon the expiration of this agreement.

2. The Company agrees to give the Distributor incentives when the sales
output of the latter exceeds the total minimum order as required in the preceding
paragraph. The kind and value of these incentives shall be left to the discretion of the
Company.

3. The Distributor shall put up a surety bond in favor of the Company in the
amount of ONE MILLION PESOS (P1,000,000.00). The bond shall answer for any
unpaid balance and other expenses the Distributor might incur during the effectivity of
this Agreement.

4. In order to meet the demand for the Products, the Distributor shall place
orders for the Products with the Company as expeditiously as possible according to the
procedures established by mutual Agreement of the parties. All orders are subject to
acceptance by the Company, and may be accepted in whole or in part at the Company’s
absolute discretion. Such acceptance shall be valid if made by written notice to the
Distributor or by actual delivery or release of the Products to the Distributor. All
purchase orders shall be binding upon the Distributor unless and until they are rejected in
writing by the Company. The Company shall not be bound by any terms or conditions
stated in the purchase orders issued by the Distributor and accepted by the Company
other than statements therein regarding Product items, quantity and requested delivery
dates. The Distributor shall exercise due diligence in delivering to the trade the Products
in the quantities and on the dates specified by the trade.

5. “No return, no exchange” policy applies in every delivery except as

otherwise stated herein.

ARTICLE IV
INVENTORY

1. The Distributor undertakes to hold and maintain sufficient inventory of the

Products to meet the market demand in the Territory promptly.
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2. The Distributor shall maintain stocks of the Products based on a schedule

of allocation and replenishment that will be provided by the Company every month. The
Distributor shall provide free of charge a segregated, secured dry storage area for
Products and follow the special storage instructions pertaining to the Products. The
Distributor hereby undertakes to properly store and care for the Products with due regard
to the special nature thereof. The Distributor shall admit at all reasonable business hours
a delegate or representative of the Company to its warehouse/branch for inspection of the
orderly storage of the Products.

ARTICLE V
DELIVERY

1. The Company shall cause the delivery of the Products ordered by the
Distributor to the Distributor’s warehouse/branch at _______________________ and in
accordance with the Company’s acceptance of orders supported by the necessary delivery
receipts.

2. The Distributor shall bear all costs of insurance and costs of delivery to
trade which shall include, but not be limited to, all taxes, duties, tariff and landing
charges of the Products incurred for delivery of the Products from the Distributor’s main
warehouse in the Territory. The Distributor shall be responsible for and shall pay any
taxes imposed on the sale of the Products.

ARTICLE VI
PAYMENT

1. The Distributor is hereby given a thirty (30)-day credit term for each
delivery. However, the Distributor is required to make a fifty (50%) percent
downpayment upon receipt by the Company of the purchase order and payment of the
balance thereof shall be made within thirty 30 days from actual receipt of the Products.
The Company shall not consider any order/s of the Distributor unless the balance of the
previous order/s is first paid and settled.

2. In case the Distributor cancels its order/s made, the downpayment/s

already made shall be forfeited in favor of the Company.

3. The Company reserves the right to change the suggested list price at any
time upon written notice to the Distributor at least fifteen (15) days before the effectivity
of the change.

ARTICLE VII
RETURN OF PRODUCTS

1. The parties hereto shall agree in writing upon a uniform procedure for the
destruction and replacement of damaged stocks, which Agreement shall form an integral
part hereof.

ARTICLE VIII
PROMOTION

1. The sales and collection personnel of the Distributor shall actively solicit
and accept orders for the Products in the Territory. The Distributor’s salesmen shall as
much as possible coordinate their field of activities with the Company’s promotional
cycles.

2. The Company agrees to furnish the Distributor with catalogs, brochures

and other related materials to better promote the Products.
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3. The Company also agrees to give the Distributor European tiles, free of
charge, to be used for its floor area in its showroom. The parties will mutually agree as to
the quantity of the same.

4. The Company further agrees to furnish the Distributor with display racks
under a loan agreement. The terms of such an agreement shall be finalized within a
reasonable period from execution hereof.

ARTICLE IX
INFORMATION

1. The Distributor shall furnish the Company with financial and other
information and materials relating to the market demand for and sales of the Products and
such other factors affecting the prices thereof.

2. The parties hereto agree to stipulate upon the nature of such other
information which, the Distributor shall be required to furnish the Company.

ARTICLE X
REPORTS AND STATISTICS

As part of the services and for purposes of effectively monitoring the Company’s
trade sales performance, the Distributor shall provide the Company with the following
statistics free of charge at the time and frequency indicated and in the forms as may be
prescribed or approved by the Company from time to time:

1. Computer diskettes containing the following, to be provided on the

fifth working day of the month:

a) Previous month’s sales transactions indicating warehouse

(branch) codes, customers category, invoice numbers, date,
customers code, credit memos and reference numbers,
product codes, quantities and amounts sold;

b) List of new customers indicating code numbers, category,

address and warehouse codes.

2. Monthly stocks and sales report by branch, if applicable, and

consolidated to include unit movements and inventory to be
submitted within the tenth day of the following month.

3. Inventory of stocks in safekeeping, within the first week of the

following month.

4. Adverse reaction reports.

ARTICLE XI
MARKETING EFFORTS

1. The Distributor shall sell the Products, cause its managers and employees
to use vigorous efforts to achieve maximum sales volumes reasonably achievable in the
Territory, and maintain in the Territory a place of business and sufficient competent and
well-trained employees, including salesmen dedicated exclusively to the sale of the
Products in the Territory, to increase the sales of the Products. The Distributor shall
endeavor to attain the objectives, goals and programs of the Company, as agreed upon by
the parties in accordance with paragraph 2 hereunder.
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2. The sales performance of each year shall be the basis for renewing this
Agreement but in no case less than the amounts stated in Article 3 of this agreement, the
terms of which shall be mutually agreed upon by the parties.

3. The Distributor shall not act as the Company’s agent and shall not accept
any order on the Company’s behalf. The Company reserves the right to remain in direct
contact with customers and prospective customers of the Distributor in the Territory.

4. The Distributor shall take adequate precautions to distribute the Products

within the Company’s standards of quality control and safe handling.

5. The Distributor shall not distribute, sell, market or promote the Products,
which are not packaged in a manner approved by the Company.

6. The Distributor shall keep and save the Company free and harmless from
any loss or claim or suit by third parties arising from any act, omission or negligence
(like in handling and storage of the Products, tampering, etc.) of the Distributor which
impair the quality of the Products. In the event such claims or suits arise, the
Distributor shall defend the Company at its own expense.

ARTICLE XII
COMPANY’S INDUSTRIAL PROPERTY RIGHTS

1. The Distributor hereby acknowledges that all trademarks, tradenames,

logos, container designs and other trade dress appearing on or used by the Company in
connection with any of the Products and any and all other trade and service marks owned
or licensed by the Company or any of its Affiliates (collectively the “Trademarks”) are
good and valid and are exclusively owned by the Company, or an Affiliate as the case
may be. As used in this Agreement, “Affiliates” shall mean the Company’s immediate
parent company and any of said parent company’s direct or indirect subsidiaries. All use
of the Trademarks by the Distributor pursuant hereto shall inure to the benefit of the
Company or the Affiliate that owns the involved Trademark.

2. The Distributor agrees that it will not, during the term of this Agreement
or at any time thereafter apply to the Products, use or display any Trademark or any
Tradename of the Company or any of its Affiliates (the “Tradenames”), or any
counterfeit, copy or colorable imitation of any Trademark or any Tradename confusingly
similar thereto except insofar as authorized in writing by the Company from time to time.
The Distributor may, however, by appropriate indications on its letterheads and any other
forms and through the exhibition of appropriate signs and advertising indicate to the
public that it is the Company’s distributor of Products in the Territory, and may use and
permit its re-sellers to use the Trademarks in an appropriate manner in advertising the
Products; Provided however, That, all advertisements of any Product(s) are subject to the
prior written approval of the Company. If the Company objects to any use or method of
display by the Distributor or any of its re-sellers of any Trademark, which use has not
therefor been approved by the Company, the Distributor shall discontinue or cause such
re-seller to discontinue such use or method of display or modify it to the satisfaction of
the Company. In no event shall the Distributor use any Trademark or Tradename as if it
were part of the Company or in any manner which, in the opinion of the Company, might
indicate that any facility or operation operated by the Distributor is operated by the
Company or any of its Affiliate, or that the Distributor is associated with the Company or
any of its Affiliates, as an Affiliate, joint venture, partner, or in any other way.

3. The Distributor shall not publish or cause to be published, encourage or

approve any advertising or practice which might mislead or deceive the public, or might
be detrimental to the good name, trademarks, goodwill or reputation of the Company or
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the Products. The Distributor further agrees to discontinue any advertising or practice
deemed by the Company to have such effect.

4. The provisions of this Article shall survive the expiration or termination of

this Agreement, however caused. All costs incurred by the Company in enforcing its
rights under this Article due to the fault or negligence of the Distributor, including,
without limitation, attorney’s fees, will be borne by the Distributor.

ARTICLE XIII
CONFIDENTIALITY

1. The Distributor shall keep confidential and cause its employees to keep
confidential any information of a proprietary nature which the Distributor receives
directly or indirectly from the Company (including but not limited to, the prices charged
to the Distributor, terms and conditions of sales to the Distributor, customers, business
affairs, products, product specifications, designs, plans, manufacturing processes, data,
know-how, ideas and technical information) excluding such information as has been
publicly disclosed by authorized officials of the Company or an Affiliate. This
obligation of confidentiality shall survive the expiration or termination of this Agreement.

ARTICLE XIV
TERM

1. This Agreement shall come into force and effect on _______________

and expires on _______________________, unless earlier terminated in accordance with
the provision hereof, shall continue in effect until either party terminates it on ninety (90)
days advance written notice to the other party. However, this Agreement may be
terminated upon thirty (30) days written notice by the Company to the Distributor if the
latter handles or agrees to handle any product which is the generic equivalent of the
Company’s Products without the Company’s prior written consent.

ARTICLE XV
TERMINATION

1. Either party may terminate this Agreement upon prior written notice of
thirty (30) days in the event of the breach by the other party of any of its obligations or
responsibilities hereunder which is not cured (if capable of being cured) within the said
30 days notice period.

2. The Distributor agrees to report promptly to the Company any major or

significant change in the legal or beneficial ownership of the Distributor. If the
Company reasonably believes that such change is prejudicial to the Company’s interests
or to the proper and efficient marketing of the Products or if the beneficial ownership of
more than fifty percent (50%) of any class of the shares of the Distributor has been
transferred, the Company may terminate this Agreement by giving thirty (30) days prior
written notice from the day it is informed of the change of ownership.

ARTICLE XVI
RIGHTS AND OBLIGATIONS UPON TERMINATION

1. In the event of expiration or sooner termination of this Agreement, as

provided above, all payments to the Company under this Agreement shall become due
and payable on the date of expiration or termination.

2. The Distributor shall cooperate with the Company and provide the latter
free of charge access to all pertinent Distributor’s previous sales, records, customer lists
and other records and data relating to sales of the Products.
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3. Upon termination of this Agreement, the Distributor shall immediately

discontinue the use of any sign or other evidence that it is a distributor of the Company,
and shall deliver to the Company or its duly authorized representative at its own expense
any and all signs, printed matter and other material upon which appear, including but not
limited to printed matter, printing blocks, advertising materials, decalcomania, name
plates, labels, business cards, stationery, catalogues, price lists and other similar material,
except such a limited amount of advertising matter as is appropriate for the sale of the
Distributor’s existing stock of Products not purchased by the Company pursuant to this
Agreement, it being agreed that the Company may enter the Distributor’s premises and
remove such signs and other matter.

4. The acceptance of any order from, or the sale of any Products by the
Company to the Distributor, after the expiration or termination of this Agreement shall
not be construed as a renewal or extension thereof nor as a waiver of termination.
Notwithstanding the foregoing, in the absence of a written agreement signed by the
Company, all of the foregoing transactions shall be governed by the provisions of this
Agreement.

5. The Company shall not be liable to the Distributor by reason of

termination of this Agreement, or its failure or refusal to renew this Agreement, for
indemnity, compensation, reimbursement or damages on account of the loss of goodwill,
clientele, prospective profits or anticipated profits or anticipated sales or on account of
expenditures, or investments or commitments in connection therewith, or otherwise
except as may be specified to the contrary herein.

6. Upon the termination of this Agreement, however caused, the Distributor

will, at the Company’s request, turn over to the Company all catalogs and other literature
and publications pertaining to the Products.

ARTICLE XVII
RELATIONSHIP OF PARTIES

1. The relationship between the Company and the Distributor during the term
of this Agreement shall be that of VENDOR and VENDEE, respectively. Neither the
Distributor nor its owners, agents, representatives, managers or other employees shall,
under any circumstances, be nor shall they hold themselves out as owners, agents,
representatives, or directors, officers, partners or joint venturers of or with the Company.
The Distributor shall have no right to enter into any contracts or commitments in the
name of or on behalf of the Company or to obligate the Company in any respect
whatsoever.

ARTICLE XVIII
GENERAL PROVISIONS

1. This Agreement shall be construed and interpreted according to the laws

of the Republic of the Philippines. Except as described in Paragraph 2 of this Article, any
claim or controversy arising out of or related to this Agreement or the making,
performance or interpretation of this Agreement shall be finally settled under the Rules of
Conciliation and Arbitration of the International Chamber of Commerce then in force, by
one arbitrator appointed by the International Chamber of Commerce in accordance with
said rules. The place of arbitration shall be in Metro Manila, Philippines, and the law
applicable to the arbitration procedure shall be determined by referring to the law of the
place of arbitration. All costs of arbitration, including the arbitrator’s fee shall be the sole
and exclusive remedy between them regarding any claims, counterclaims, issues, or
accountings presented or pleaded to the arbitrator; that it shall be made and shall
promptly be payable free of any tax, deduction or offset; and that any costs, fees, or taxes
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incident to enforcing the award shall, to the maximum extent permitted by law, be
charged against the party resisting such enforcement. The award shall include interest
from the date of any damages incurred for breach or other violation of the contract, and
from the date of the award until paid in full, at a rate to be fixed by the arbitrator, but in
no event less than one-and-a-half percent (1.5%) per month, or part of a month, from the
date until paid.

2. Nothing herein contained (including, without limitation, Paragraph 1

hereof, regarding arbitration) shall bar the Company’s right to obtain injunctive relief
from any court having valid jurisdiction against threatened conduct that will cause it loss
or damage, under the usual equity rules, including the applicable rules for obtaining
specific performance, restraining orders, and preliminary injunctions.

3. In the event any part or provision of this Agreement is declared void by

competent authorities for any reason, the parties hereto shall meet together within thirty
(30) days of such declaration to negotiate in good faith and draw up an appropriate
amendment and make valid that part found to be void or unenforceable. The other parts
of the Agreement not otherwise affected shall remain in full force and effect.

4. This Agreement contains the entire and only Agreement between the
parties respecting the subject matter hereof, and supersedes and cancels all previous
negotiations, Agreements, commitments and writings in connection therewith. This
Agreement may be modified only by a written instrument duly signed by the parties.

IN WITNESS WHEREOF, the parties hereto have hereunto set their hands this
_____ day of ________________ in ________________, Philippines.

__________________ ___________________
Company Distributor

SIGNED IN THE PRESENCE OF:

________________________ ________________________

ACKNOWLEDGMENT

REPUBLIC OF THE PHILIPPINES)

) S.S.
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BEFORE ME, a Notary Public for and in the City of _______________, this day
of _______________, personally appeared the following persons, with their Comm. Tax
Certificate No., to wit:

Name Comm. Tax Cert. No. Date/Place Issued

known to me and to me known to be the same persons who executed the foregoing
instrument and acknowledged to me that the same is the product of their own free and
voluntary act and deed.

WITNESS MY HAND AND SEAL on the date and at the place first above-
written.

Doc. No. _____;

Page No. _____;
Book No. _____;
Series of ______.