KBS International Holdings Inc.: Exhibit 10.22 - Filed by newsfilecorp.com






Exhibit 10.22

Franchising Distribution Agreement


Parties: 

Party A: Hongri (Fujian) Sporting Goods Co., Ltd. 

Address: Xinfengge Building, Yupu Industry Zoon, Baogai
Town, Shishi City, Fujian 

	Tel: 0595-88896198 	Fax:0595-88853196 


Party B: 

Party A and Party B based on the principle of mutual benefits,
long term cooperation and the long term win-win model to comply with the policy
of market development, exclusive distribution and geographic division of Hongri
(Fujian) Sporting Goods Co., Ltd., and other relevant cooperation model. Upon
the friendly negotiation, both parties hereto covenant and agree as follows:


The Terms of the Agreement 

	Artical 1. 	
      Authorized Contends, Scope, Geographic Area, Time
      Limit of the Franchising Distribution.

	 	 	 	 
	1.1 	
      Party A agrees to authorize Party B exclusively
      distribute the sporting products of Hongri (Fujian) Sporting Goods Co.,
      Ltd. in the ___________(Province)_______(city/district) (the specific area
      include: _______________________), Party B shall distribute products
      within the above authorized area by Party A.

	 	 	 	 
	1.2 	
      From the date when Party B obtains the authorization from
      Party B to distribute the products, Party B shall have right to set up the
      “KBS exclusive store”, exclusive room, exclusive counter to sell products
      with KBS brand within the area as agreed in the Agreement, and within the
      authorized area, Party A shall not authorize the third party the
      franchising distribution, and Party A shall not set up the distribution
      network. Without Party A’s written approval, Party B shall not the
      franchising distribution right authorized by Party A to any third party
      authorize the third party to distribute the sporting products with KBS
      brand.








	1.3 	The term of franchising distribution
      right granted by Party A is one year, the term is from
      ___________________to _________________________. After one year, when the
      Agreement expires, both parties have right to decide whether to renew the
      Agreement at their own discretion after taking into the performance of the
      Agreement. 
	  	  	  	  
	1.4 	When Party B signs the contract,
      Party B shall pay the guaranteed deposit RMB_______to guarantee that he
      will strictly perform the Agreement, there is no interest to the
      guaranteed deposit, and Party A shall return guaranteed deposit to Party B
      after 15 days of the termination of the Agreement. 
	 	 	 	 
	Artical 2. 	Basic Requirements of Both Parties
	  	   	  	  
	2.1 	Party A shall guarantee: 
	  	  	  	  
		2.1.1 	Party A is the legal authorized agent
      and manufacturer approved by administration bureaus for industry and
      commerce; 
	  	  	  	  
	  	2.1.2 	Party A manufacture and sell products
      with KBS brand. 
	  	  	  	  
	2.2 	Party B shall guarantee: 
	  	  	  	  
	  	2.2.1 	Party B shall have the qualification
      to sell products with KBS brand; 
	  	  	  	  
		2.2.2 	Party B shall have the capital, site
      and personnel required to perform the Agreement. 
	  	  	  	  
		2.2.3 	Party B shall have certain business
      management capability and marketing capability. 
	 	 	 	 
	Artical 3. 	Basic Rights and Obligations of Both
      Parties
	  	  	  	  
	  	3.1 	The basic rights and obligations of
      Party A 
	  	  	  	  
		3.1.1 	To maintain the Party A’s reputation
      and KBS brand image, Party A shall have right to supervise and guide Party
      B’s business activities; 
	  	  	  	  
		3.1.2 	Party A shall have right to require
      Party B to complete the purchase target according to the Agreement; 
	  	  	  	  
		3.1.3 	Party A shall have right to require
      Party B to pay the franchising guaranteed deposit and furniture expenses
      and other fees according to the Agreement; 
	  	  	  	  
		3.1.4 	If Party B violate the Agreement,
      Party A shall have right to withdraw the granted franchising distribution
      right in advance; 
	  	  	  	  
		3.1.5 	Party A shall allow Party B to sell
      the products with KBS brand by setting up KBS store and counter in
      shopping mall, and shall provide Party B with relevant documents and certificates, including power of
      attorney and documents related to products (copy);







	 	3.1.6 	
      Within the geographic area as agreed in the Agreement,
      Party A shall not authorize any third party to distribute the products,
      and Party A shall not set up any distribution network by
himself;

	 	 	 
	 	3.1.7 	
      Party A shall provide opening store guideline and
      training to Party B;

	 	 	 
	 	3.1.8 	
      Party A shall supply the qualified products with KBS
      brand according to the Agreement and purchase orders signed by both
      parties.

	 	 	 
	 	3.2 	
      Basic Rights and Obligations of Party B

	 	 	 
	 	3.2.1 	
      Party B may perform the franchising distribution right
      granted by Party A according to the Agreement;

	 	 	 
	 	3.2.2 	
      Party B is the independent legal person from Party A,
      both parties assets are independent from each other, and Party B shall not
      have right to sign contract with third party or make premises to third
      party under the name of Party A;

	 	 	 
	 	3.2.3 	
      Party B shall accept Party A’s supervision and guidance,
      and comply with the marketing policy and opinion offered by Party
  A;

	 	 	 
	 	3.2.4 	
      Party B shall maintain KBS brand image, and strike the
      fake and inferior products with Party A;

	 	 	 
	 	3.2.5 	
      Party B shall conduct the marketing within the geographic
      area specified in the Agreement;

	 	 	 
	 	3.2.6 	
      Party B shall participate the business training organized
      by Party A;

	 	 	 
	 	3.2.7 	
      Party B shall sell products within the specified area
      according to the price made by Party A, Party B shall not sell products
      with KBS brand beyond specified area, and shall not purchase the products
      from the third person and dump the products at low price, and shall not
      sell the products without KBS brand in the exclusive store, exclusive
      hobby and exclusive counter, shall not transfer the franchising
      distribution right to third party or authorize third party to sell
      sporting products with KBS brand. Otherwise, Party A shall have right to
      dismiss the Contract and require Party B to undertake the liability of
      breach;

	 	 	 
	 	3.2.8 	
      Party B shall acknowledge that the trade name and
      trademark of KBS are owned by Party A, Party B may sell the products with
      KBS brand under the authorization of Party A according to the
      Agreement;








		3.2.9 	Party B shall provide required relevant documents
      and certificates to Party A, including drawing of business area,
      information of store manager, and business license (copy);
	 	 	 	 
		3.2.10	
      Party B assist Party A in establishing the national
      market information net, and provide the accurate market and competitor
      information to Party A timely. In the business activities, Party B shall
      activity assist Party A in promoting and selling of KBS products and
      services.

		 	 
	Artical 4. 	Supply of Products
	 	 	 	 
	4.1 	
      During the term of the Agreement, Party A shall supply
      products to Party B at price without tax, and Party B shall be liable for
      the storage of the products. Party A may deliver the products after
      receiving payment. Party B shall not change the retail price without Party
      A’s permission, after the approval of Party A, Party B may adjust the
      retail price according to the market.

	 	 	 	 
	4.2 	
      Party B’s financial department and Party A’s department
      may check the accounting statement once each 15 days strictly according to
      Party A’s financial policy.

	 	 	 	 
	4.3 	
      The products are divided into “future products” and
      “products in stock” (“future products” are the products are put into the
      national purchasing activity hold by KBS sporting, and the future products
      are required to pay the deposit. ). Generally, we may provide the future
      products first, and when the future products can’t meet the purchasing
      amount, we may supply products in stock. Party A shall deliver the
      products according to Party A’s logistic procedure.

	 	 	 	 
	4.4 	
      Party B shall fax the storage statement in writing to
      Party A’s staff who is responsible for dealing with the distribution
      relationship every week. Party A shall analyze the national distributors’
      storage on the weekly meeting to seek the best way to deal with the
      storage.

	 	 	 	 
	4.5 	
      During the term of the Agreement, it is required to pay
      the deposit in advance when purchase products, the standard of the deposit
      is: the 30% of the total discounted amount is the deposit, the deposit
      shall be paid by Party B to Party A within 15 days after the confirmation
      of the purchase order, and the remaining 70%of the total discounted amount
      shall be fully paid before the delivery. Party A shall arrange the
      delivery after receiving the payment. If Party B fails to pay the deposit
      and the remaining payment according to the article, Party A shall postpone
      the delivery date accordingly, and Party B shall undertake the losses
      therefrom.

	 	 	 	 
	4.6 	
      To make the KBS brand products more adoptable to the
      market, and to develop the KBS better, Party A shall adjust the sales
      policy timely according to the market change, and Party B shall comply
      with the adjusted policy.








	4.7 	Party A shall provide
      Party B with qualified products which are in accordance with the symbols,
      if the there is quality problem, Party B shall have right to replace the
      products. 
	  	 	  
	4.8 	If Party B requires to
      return products under special circumstances, Party B shall apply with
      Party A in writing, upon the approval of Party A, Party B may return the
      products, the requirements of products return are as follows: Party B
      shall return the products in complete, clean package, if there is damage
      or defects on the products, Party A shall have right to receive products
      or deduct the damages from the payment. The purchasing and replenish of
      Party B shall be confirmed by Party A in writing. Party B shall arrange
      the transportation for Party B at Party B’s cost. Party A shall deliver
      the products to Party B in complete, clean and firm package, if there are
      losses due to quantity shortage , or package deficiency, Party A shall be
      liable for the losses upon the confirmation of the losses by Party A,
      otherwise, Party B shall be liable for the losses. 
	  	 	  
	4.9 	Party A shall deliver
      the products to Party B under Party’s requirement, when the products are
      delivered to the designated place of Party B according to Party B’s
      requirement, it would be deemed that the products are received by Party B,
      and Party A completes the duty of delivery. When Party B receives the
      products from Party A which are delivered by air, if Party B has no
      disagreement on the products within 3 days after he receives the products,
      Party A may treat this payment as account receivable; When Party B
      receives the products from Party A which are delivered by truck, if Party
      B has no disagreement on the products within 3 days after he receives the
      products, Party A may treat this payment as account receivable; if party B
      fails to bring the disagreement within 3 days on the products he received,
      the it would be deemed that Party B accept products. 
	  	 	  
	Artical 5. 	Business Site
	  	 	  
	5.1 	Party B shall exhibit
      products at exhibition lobby with above 80 square meters within area
      specified in the Agreement, the products shall be exhibited to attract
      more sub-exclusive stores and franchise stores. 
	  	 	  
	5.2 	When Party B sell
      products with KBS brand, the exhibition of the products is required to
      show the sample effect of Party A’s products. 
			  
	Artical 6. 	Confidentiality 
	  	 	  
	6.1 	Party B shall undertake
      the confidentiality liability to business management technology, marketing
      method which are provided by Party A according to the Agreement and other
      commercial secrets. 
	  	 	  
	6.2 	Party B shall premise
      that he will not use the confidential documents out of purpose for the
      Agreement, and disclose or allow the third party to use confidential
      documents in the Agreement, and shall not disclose any Party A’s confidential documents to its
      employees, unless the employee knows or holds the confidential documents
      for work reason.
  







	6.3 	Party B shall sign a same or similar
      confidentiality agreement with the Article with the employee who knows or
      holds the confidential documents for work reason, and adopt all reasonable
      measures to protect such confidential documents to avoid such confidential
      documents are known or held by other employees other than the employee
      mentioned in the Article 6.2 and 6.3 or by public. 
	  	  	  
	6.4 	Party A deliver confidential
      documents to Party B does not mean that Party A authorizes Party B any
      patent or copyright, or mean that Party B has all rights of such
      confidential documents. 
	  	  	  
	6.5 	The confidentiality comes into effect
      on the effectiveness date of the Agreement, and the valid term of
      confidentiality shall last for 3 years after the ending of the franchising
      distribution relationship of both parties. 
	  	  	  
	6.6 	If Party B violates the
      confidentiality duties, Party B shall unconditionally guarantee to
      indemnify all the direct and indirect losses caused to Party A 
	  	  	  
	Artical 7. 	Termination 
	  	  	  
	7.1 	Unless otherwise is provided in the
      other articles of the Agreement, Party A shall have right to terminate the
      Agreement with written notice: 
	  	  	  
	  	7.1.1 	Party B fails to complete the purchase target
      according to the Agreement; 
	  	  	  
		7.1.2 	Party B transfer the franchising distribution
      right or authorize third party to sale sporting products with KBS brand;
    
	  	  	  
	  	7.1.3 	Party B seriously damage KBS brand image and
      Party A’s interests; 
	  	  	  
		7.1.4 	Party B refuse to accept the supervision and
      inspection on the business, guidance and legality of Party A; 
	  	  	  
		7.1.5 	Party B has bankrupted, or has received the
      bankruptcy order or is in ratification; 
	  	  	  
	  	7.1.6 	Party B violates the state laws and
      regulations; 
	  	  	  
		7.1.7 	The shareholders or controlling shareholders of
      Party B are changed, or the Party B’s business is transferred to third
      party. 
			
	 	 
	7.2 	Upon the termination of the
      Agreement, Party B has no right to use KBS brand in its retail stores, and
      Party B shall return all the products and other objects with KBS brand,
      including store symbol, original of power of attorney and other relevant documents, Party B shall move out all
      the objects with KBS brand exist outside or inside of the business site,
      such as the lamp box, sign board. Party B shall present Party A with the
      detail names and reports of customers related to Party A, to ensure
      provide continuity service to customers, and Party B shall not conduct any
      business activity under the name or brand of Party B. Otherwise, Party A
      shall have the right to confiscate Party B’s guaranteed deposit, and claim
      Party B to undertake legal liability.
  







	Artical 8. 	Breach of Agreement 
	 
	8.1 	Both parties shall strictly comply
      with the terms hereunder, otherwise, it shall constitute a breach of this
      Agreement. 
	  	 	  
	8.2 	If either party breaches this
      Agreement, the other party has the right to determine the severity of the
      breach of agreement, and claim against the defaulting party for penalties
      equal to from RMB 10,000 to RMB 100,000; if the non-defaulting party
      suffers any economic losses, it has the right to claim against the
      defaulting party for compensation; if either party breaches the agreement
      seriously, or although the breach of agreement is not sever but the
      defaulting party fails to correct or make remedies in time, in addition to
      claiming for default liabilities and compensation, the non-defaulting
      party has the right to unilaterally terminate this Agreement. In addition,
      during the performance of the Agreement, if Party B breaches the
      obligations provided in Article 3.2.7, or Party B severally damage KBS
      brand image, Party A shall have right to confiscate the guaranteed
      deposit, dismiss the contract and require Party B to undertake the
      compensation. 
	  	 	  
	8.3 	If either party fails to perform the
      Agreement all or in part or delays in performing the Agreement because of
      the Force Majeure, the party shall notify the other party within 15 days
      from the date when the Force Majeure event occurs, submit the valid
      certificate issued by local notary authority, and shall adopt measures to
      avoid the additional damages. If the breached party fails to notify the
      other party or adopt the measures to avoid the additional losses, the
      breached party shall be liable for the additional losses. Upon the
      negotiation between both parties, may exempt or partly exempt the duties
      of performance of the Agreement, also can negotiate a supplement agreement
      on remedial measures to perform. If the event does not disappear or the
      Agreement obviously can not be performed within 90 days after the
      occurrence of the event, both parties may negotiate to dismiss the
      Agreement in writing, and deal with following matters according to each
      party’s liability. The above mention Force Majeure is the unpredictable,
      uncontrolled and unexpected event, including but not limit to natural
      disasters, government activities and war. 
	 	 	 
	Artical 9. 	Miscellaneous 
	 	 	 
	9.1 	After Party A and Party B sign or seal this
    Agreement, and Party B has paid the deposit hereunder, this Agreement will
    become of effect. This Agreement will be effective until [date] . If
    both party wish to continue the franchising distribution relationship, Party
    B shall serve Party A a written application at lease two (2) months prior to
    expiration date of this Agreement and enter into an extended agreement.







	9.2 	
      If any information of the addresses, telephone numbers or
      fax numbers changes at the beginning of this Agreement changes, either
      party shall notify the other party in writing; otherwise, the responsible
      party shall bear the consequences caused by failure of delivering the
      notice.

	 	 
	9.3 	
      If part of this Agreement becomes not effective, any
      other part of this Agreement shall remain effective and
  enforceable.

	 	 
	9.4 	
      This Agreement is entered in two (2) counterparts with
      each party holding one counterpart. The appendix hereof shall have the
      same effect as this Agreement. Both parties shall consult with each other
      for any matter that fails to be agreed hereunder. If the parties fail to
      reach a consent, either party has the right to apply for arbitration at
      Quanzhou Arbitration Commission or bring a lawsuit at People’s Court in
      Shishi City.

	 	 
	9.5 	
      For any matter that fails to be stipulated hereunder,
      Party A and Party B shall further consult with each other and make an
      agreement.




	 	Party A: 	Party B: 
	 	Representative: (Signature) 	Representative: (Signature)



Date: