Phoenix Energy Resource Corporation: Exhibit 10.17 - Filed by newsfilecorp.com






Exhibit 10.17

	
    


    
	
     


	Silvan Touch Exclusive
      Distribution Contract 
	Edition: V l.0 	Contract No.:201008002 



	Party A: Qianxinan Silvan Flooring Company Limited.
    
	Party B: Zeng Tianming 


After consultations and confirmation in accordance with the
principles of honesty, cooperation in good faith, equality and mutual benefit,
Party A and Party B hereby enter into the cooperation agreement in respect of
the distribution of “Silvan Touch” series products. Both parties represent as
follows: both parties have understood and recognized all contents herein, and
agree to undertake their respective responsibilities and obligations, and
perform the Agreement faithfully.

	I. 	Recognition and Appointment 


Article 1 Party B is willing to distribute the “Silvan Touch”
brand laminate flooring, multi-layer solid wood flooring, solid wood
flooring and accessory series products manufactured by Party A, and has
recognized and will voluntarily abide by Party A’s conditions and policies on
distribution of products; while Party A, after the survey and assessment, hereby
appoints Party B as the exclusive distributor of Silvan Touch products in
Hunan Province (territory: subject to the administrative division of the
state). Article 2 Qualifications for Party B to become a distributor of
Party A in the aforesaid territory: 

1.      Annual sales target of Party B agreed by both parties: RMB
FIFTY MILLION (¥:50,000,000.00)

2.      Upon the execution of the Contract, Party B shall possess 20
subordinate distributors of Party A’s products at least within three months
after the commencement of the distribution cooperation, and develop no less than
40 subordinate distributors of Party A’s products within six months; and
the total number of Party B’s sales outlets in the same year shall be up to
80.

3.      Subordinate distributors governed by Party B shall abide by
relevant policies of Party A on product distribution, and carry out unified
store image building under relevant cost support and terminal image logo
requirements of Party A, as well as conduct the market information feedback with
Party A, and implement standard distribution and after-sale service in light of
Party A’s training.

4.      Party B shall pay RMB FIFTY THOUSAND ONLY (¥:50,000.00) to
Party A as the brand maintenance fee within seven working days after the
execution of the Contract.

	II. 	Division of Distribution Territory 


Article 3 The distribution territory of Party B as the
distributor in the appointed territory shall be subject to the determination of
both parties through negotiation, which, in principle, shall be subject to the
administration division promulgated by the state as the division standard.

Article 4 Under the premise that Party B has fulfilled the
monthly and annual sales targets stipulated by Party A, Party A shall be obliged
to implement the distribution appointment strictly. During the cooperation
period, Party A shall not make supply to other distributors excluding Party B in
the territory, regardless of the excuse (with the exception that any large real
estate project orders directly from Party A). Party A will conduct an assessment
to Party B’s fulfillment of the sales target on a quarterly basis. Where Party B
fails to fulfill corresponding sales target, Party A will make such decisions as
giving warning to Party B, reducing the distribution territory of Party B,
increasing distributors in specially appointed territory within the territory,
or terminating the distribution appointment as the case may be.

	III. 	Rights and Obligations of Both Parties 


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	Article 5 Rights and obligations of Party A



1.      Party A shall be obliged to provide products conforming to
the provisions of national laws and regulations, and offer after-sale service to
the products in light of relevant national provisions.

2.      Party A shall be obliged to provide corresponding marketing
documents in supply (relevant supporting documents that Party B, in light of
relevant national provisions, believes that Party A shall present).

3. Party A shall have the right to monitor the distribution
territory of Party B, and to advance the opinions for improvement to guarantee
the consistency of Party B’s development with the Company;

4.      Party A shall have the right to access the data regarding
the territory governed by Party B, and to build the database. The aforesaid data
belong to confidential documents within the cooperation period of both parties
and even after the termination of the cooperation, and shall not be disclosed to
any third party.

5.      Party A shall have the right to decide on the regional
advertising campaign project;

6.      During the cooperation period, Party A shall be obliged to
guarantee the maximum interests of Party B in distribution;

7.      During the cooperation period, Party A shall be obliged to
guarantee Party B’s after-sale service in distribution to the utmost extent;

8.      Party A shall be obliged to assist Party B to develop
network, hold promotion conference, market seminar, trainings, etc.; and

9.      Party A shall reserve the right to divide and adjust the
national market area.

Article 6 Rights and obligations of Party B

1.      Party B shall have the right to distribute Party A’s
products within the appointed distribution territory governed;

2.      Under the premise of not violating Party A’s policies on
sale of products and market operation, Party B shall have the right to decide on
the business decision of subordinate distributors;

3.      Party B shall be obliged to follow and implement various
sales policies, price policies, market management policies and after-sale
service policies of Party A in its distribution activities;

4.      Party B shall have the right to monitor the market operation
of Party A’s personnel; and

5.      To suggest the advertising campaigns in its distribution
territory;

6.      To take charge of the negotiation and handling with local
consumer council, administration of industry and commerce, quality inspection
authority, and press;

7.      Where Party B has no serious defaults during the contract
period, and proposes continuous distribution cooperation after the expiry of the
Contract, and can conduct distribution in light of Party A’s distribution
policies, it shall have the priority to renew the distribution contract, but
both parties shall conclude a new distribution contract in light of the market
situation at that time;

8.      Party B shall organize a full-time marketing team of 10
people above to specially take charge of the market development and maintenance
of ”Silvan Touch” products. Besides, Party B shall also, in light of needs, set
up exclusive store or counter in key building material market to promote the
distribution;

9.      Party B shall be obliged to organize distributors within its
distribution territory to participate in the promotion conference, market
seminar, training meetings, etc.; and 10. In any promotion campaign carried out
for the purpose of market launch and stabilization, Party B shall allocate
special human, material and financial resources to give cooperation and
support.

	IV. 	Ordering, Payment and Mode of Transportation



Article 7 Ordering and payment

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1.      When placing an order, Party B shall issue a written order
form to Party A (including fax order). An order form shall be signed by Party
B’s legal representative or authorizee. Each order form shall form an annex to
the Contract, and constitute an integral part of the Contract.

2.      Party B shall pick up goods in ready money, and remit the
payment for goods to the bank account designated by Party A through bank.

Article 8 Mode of transportation and responsibility

1.      Party A, after receiving Party B’s remittance and confirming
the receipt, shall be responsible for forwarding the goods ordered by Party B to
the cargo terminal designated by Party B; while Party B shall give Party A the
detained name of the cargo terminal, name of consignee and the contact
information in writing.

2.      Party A shall be responsible for loading the goods and
forwarding them to the cargo terminal designated by Party B, also bear all
liabilities prior to the sign-off of the cargo terminal designated by Party B.
Party B shall be obliged to check and accept the goods on the day when the goods
arrive at the cargo terminal; in the event of any discrepancy in quantity,
quality, specification, or model, Party B shall advance written opinions to
Party A within two days as of the date when it receives the goods; or it shall
be taken that the goods are qualified in terms of quantity, quality, etc.

3.      Party B shall undertake the freight and risk from the cargo
terminal designated by Party B to Party B’s destination.

4.      Where Party B intends to insure the goods, it shall
stipulate the insured amount in the order and be liable for the insurance
handling charge.

	V. 	Market Protection Strategies 


Article 9 Party B shall carry out the market development in
light of the sales model of Party A.

Article 10 Party B can only sell the products within the
appointed territory, and is prohibited to sell beyond the appointed territory.
Sale of Party B directly or through any third party beyond its appointed
territory shall be deemed as irregular cross-territory sales. In case of
malicious cross-territory sales, Party A shall have the right to, in accordance
with its provisions prohibiting cross-territory sales, punish Party B and even
cancel Party B’s exclusive distributorship as the case may be.

Article 11 In the market territory management, in the event of
cross-territory sales within Party B’s territory, Party B shall have the right
to punish its subordinate distributors. In case of cross-territory sales beyond
the territory of Party B, Party A shall have the right to punish Party B;
meanwhile, Party B shall punish relevant responsible distributor and person.

Article 12 Party B shall monitor whether Party A’s regional
market administrator has engaged in any irregularity within its appointed
distribution territory. Once any irregularity has been found, it shall forthwith
notify Party A’s headquarters in writing; while Party A shall be obliged to
handle the irregularities reported, and give explicit reply to Party B within
five working days.

Article 13 General principles adopted by Party A in the
handling of irregularities:

1.      Where any irregularity has been confirmed, Party A will give
handling opinions to the party engaging in the cross-territory sales and the
injured party respectively;;

2.      The party engaging in the cross-territory sales shall
forthwith act in light of the contents stipulated in the handling opinions;

3.      The party engaging in the cross-territory sales shall accept
the punishment in light of the handling opinions;

4.      Where the default party fails to follow the handling
stipulated herein, it shall be taken as breach of contract. Party A shall have
the right to cancel its distribution right and reserve the right to investigate
the default liability of the default party;

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5. If the party engaging in the cross-territory sales solves
the problem with the injured party through negotiation, Party A shall respect
the solutions and undertake not to investigate other liabilities.

	VI. 	Intellectual Property Protection 


Article 14 Party B represents and warrants that it knows
clearly that “Silvan Touch” is Party A’s trademark and trade name, and it can
only use the trademark and trade name in the manner recognized by Party A while
selling and publicizing Party A’s “Silvan Touch” brand products.

Article 15 Party B further represents and warrants to Party A
that it respects the intellectual property of Party A, and will use “Silvan
Touch”-related copyright, trademark right, patent right, internal software, user
interface and other rights strictly in accordance with Party A’s instructions.
Party B, without the written consent of Party A, shall not change “Silvan Touch”
products and its packages, or affix other loges arbitrarily, or use Party A’s
trademark, trade business, logo and package in other business activities.

Article 16 Party A shall have the right to unilaterally
terminate the Contract and claim compensation against Party B for any tort
resulting from misuse.

Article 17 Party B shall be obliged to keep Party A’s trade
secrets obtained for distributing Party A’s products confidential. Moreover, the
confidentiality obligation shall not be terminated due to the contract
termination by both parties.

Article 18 Party B, as a distributor of Party A, shall be
obliged to safeguard the intellectual property of Party A within its
distribution territory, and shall forthwith stop the behavior of any party
infringing the intellectual property of Party A found, and notify Party A in
writing of it.

	VII. 	After-sale service Management 


Article 19 Any quality problem of Party A’s products shall be
handled in accordance with relevant provisions of the state.

Article 20 Upon the arrival of Party A’s first products at
Party B, Party B shall start the establishment of the after-sale service
center.

Article 21 See Party A’s detailed after-sale service management
documents for the warranty scope, warranty period, purchase price and settlement
of Party A’s products and accessories for details. Article 22 In the event of
any quality defect with certain batch of products due to production of Party A,
Party A shall be obliged to give timely replacement, and be liable for the
freight of the goods returned. In principle, replacement is unavailable for
non-quality problem.

Article 23 Party A shall provide technical information
regarding the products to Party B by various means and on a regular basis, and
set up the user hotlines to offer better service to users.

Article 24 Party A shall be obliged to solve complaints of end
users within the distribution territory of Party B.

	VIII. 	Term and Termination 


Article 25 The Contract shall be valid for one year from 25
August 2010 to 25 August 2011, and shall become effective after
signed and sealed by both Party A and Party B.

Article 26 In any of the following cases, either party shall
have the right to notify the other party in writing to terminate the
Contract:

1.      The other party has violated
the Contract seriously or Party B has failed to fulfill the monthly sales plan
assigned by Party A for three consecutive months; 

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2.     Either party goes bankrupt or enters the liquidation
procedures (regardless of mandatory or voluntary);

3.      Force majeure frustrates the contract performance;

4.      Party B assaults, slanders or damages the image and
reputation of Party A in public or media;

5.      Upon the termination of the Contract, Party A shall
represent to Party B in writing that Party A shall be responsible for the
after-sale service of all products sold by Party B.

	IX. 	Dispute Resolution 


Article 27 In respect of any dispute arising from the Contract
(including the disputes arising from the termination of the Contract), either
party shall have the right to notify the other party in writing of the
substantial contents of the dispute and its willingness to solve it through
amicable negotiation. Both parties shall try to solve the dispute friendly
within 30 days as of the aforesaid notification date. Article 28 Where no
solution acceptable by both parties is found out within 30 days, either party
shall have the right to take legal action at the court of the place where Party
A is located.

	X. 	Miscellaneous 


Article 29 This Contract shall be made in quadruplicate, with
Party A and Party B each holding two of equal legal effect, Article 30 Matters
uncovered herein shall be supplemented in the “Supplementary Agreement”. In the
event of any conflict with the Contract, the “Supplementary Agreement” shall
prevail. “Supplementary Agreement” to the Contract shall form an integral part
of the Contract, and have the equal effect as the Contract.

Article 31 Both Parties confirm that the Contract is
confidential; and neither shall disclose it to any third party without the
written consent of the other party.

Article 32 Upon the written consent of both Party A and Party
B, and the conclusion of the change letter by Party B and a third party, Party B
can transfer its distribution right to a third party, but the transferee shall
conclude a new distribution agreement with Party A.

Article 33 Party A shall bear no liability for any business
activity of Party B in distribution violating the national laws, which shall be
solved by Party B independently.

	XI. 	Important Notes 


Article 34 Party A solemnly declares that during the valid
implementation period of the Contract, all business intercourse between Party A
and Party B shall be subject to Party A’s written notice (reply); and oral
commitments of Party A’s staff regardless of the title shall be deemed as
invalid; Article 35 Party A solemnly declares that during the valid
implementation period of the Contract, any personnel of Party A regardless of
the title, without the written authorization of Party A, shall not get involved
in any economic intercourse with Party B; or the party concerned shall bear all
consequences therefrom.

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	Party A: Qianxinan Silvan Flooring Company 	Party B: Exclusive Distribution of Silvan Touch
      in 
	Limited. 	Hunan Province 
	Signatory Representative: 	Signatory Representative: Zeng Tianming 
	Legal Representative: Bai Yulu 	Legal Representative: 
	Date: 25 August 2010 	Date: 25 August 2010