Version Area SEA April 2006

DEALER AGREEMENT

BETWEEN

PT. adidas Indonesia

AND

Virgo

DEALER AGREEMENT

Index

1. General Provision 21.1. Fundamental Condition 21.2. Definitions 3

2. Dealer’s Representations and Warranties 43. License of Rights 5

3.1 Grant of Non-Exclusive Rights 53.2 Restrictions on Dealer 63.3 Reservation of Distributor’s rights 6

4. Duration of Agreement and Security 74.1 Term of Agreement 74.2 Performance Security 84.3 Renewal of IBG 8

5. The Image of the Authorised Outlet, Furniture and Equipment 95.1 Authorised Outlet Identity 95.2 Fitting Out & Furniture and Equipment 95.3 Renovation and Maintenance 105.4 Title to Furniture and Other Distributor Supplied Items 11

6. Operation of the Authorised Outlet 126.1 General 126.2 Shop Staff 126.3 Other 13

7. Purchase, Sale and Promotion of the Products 137.1 Purchase of Product 137.2 Sale of Product 157.3 Promotion of Product 17

8. Dealer’s Obligations 188.1 Positive Covenants 188.2 Negative Covenants 208.3 Insurance 218.4 Reporting 22

9. Distributor’s Obligations 2210. Termination 24

10.1 Termination by Both Parties 2410.2 Termination by Either Party for Cause 2410.3 Termination by Either Party without Cause 2410.4 Termination by Distributor 2510.5 Consequences upon Termination 2610.6 No Entitlement to Damages for Economic Loss 2910.7 Waiver of Territory Laws 29

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11. Confidentiality 2912. Miscellaneous Provisions 30

12.1 Interpretation 3012.2 Assignment by Dealer 3112.3 Force Majeure 3112.4 Copyright 3212.5 Lease of Premises 3212.6 Further Assurances 3212.7 No Deductions, Withholdings or Set-Off 3312.8 Other 33

13. Representations, Warranties and Disclosure 3314. Notice 3515. Severability 3516. Survival 3617. Governing Law and Governing Language 3618. Settlement of Disputes 36

Annexures

Annex 1 Schedule

Annex 2 Sample of Authorisation Letter

Annex 3 List of Authorised Outlets

Annex 4 Franchise Commercial Terms and Conditions (Including Distributor-Dealer Partnership Program)

Annex 5 adidas Group Inventory Valuation Principles for the Repurchase of Product Stocks

Annex 6 General Terms and Conditions of Trading

Annex 7 List of Distributor Trademarks and Other Intellectual Property

Annex 8 List of Distributor Sales Policies

Annex 9 Detailed Descriptions of the Working Clothes to be Worn in the Authorised Outlets

Annex 10Sample of Bank Guarantee Letter

Annex 11adidas Group Standard Terms of Engagement

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DEALER AGREEMENT

This DEALER AGREEMENT(hereinafter referred to as this "Agreement") is entered into this 1st day of December 2006, by and between:

PT. adidas Indonesia, a company duly incorporated under the laws of the Republic of Indonesia and having its principal office at Plaza DM 14th Floor, Jl.Jend. Sudirman Kav. 25, Jakarta 12920, Indonesia (hereinafter referred to as the "Distributor");

and

Virgo, a company duly incorporated under the Republic of Indonesia, and having its principal office at Pertokoan Gajahmada Plaza Blok T/1-5 Semarang, Central Java, (hereinafter referred to as the "Dealer"), the Distributor and the Dealer being hereinafter collectively referred to as the “Parties” and individually referred to as the “Party”.

WHEREAS:

A. The Distributor is an affiliate of adidas-Salomon AG Group of companies (collectively “the adidas Group”), a leading manufacturer of sports and leisure products.

B. The Distributor currently has an exclusive licence to use and sub-license the use of all trademarks, patents and other intellectual property rights ("Trademarks") related to the adidas® brand (“Brand”), and possesses the knowledge and experience of management, organisation, distribution and promotion ("Know-How"), which safeguard the uniform attractive look, professional customer service and efficient operation of adidas® concept stores (“Brand Stores”) and adidas® concession corner (shop-in-shop) locations (“Concession Corners”) reflecting the high quality represented by the Brand throughout the world, including in the geographical territory of the Republic of Indonesia(“Territory”).

C. The Dealer desires to be appointed by the Distributor to operate exclusive Brand Stores located at mutually agreed shopping malls or other retail locations only and/or Concession Corners, if any, on a non-exclusive basis located at specified shopping malls, department stores or other retail locations (“Authorised Outlets”) in the Territory using the Trademarks and the Know-How, and to operate the Authorised Outlets with respect to the standards corresponding with the image and the good reputation of the Brand and for the duration of this Agreement specified in Clause 4.1 below (“Term”).

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D. The Distributor has agreed to appoint the Dealer and the Dealer has agreed to accept appointment as an authorised Dealer to operate Authorised Outlets” as noted in Clause C above, in the Territory for the sale, to the exclusion of all other products not previously discussed with and agreed in writing by the Distributor, of all or some of the Brand products (“Products”) upon the terms and conditions hereinafter appearing.

E. The Dealer agrees to purchase Products from the Distributor on an ongoing and non-exclusive basis.

NOW, in consideration of the foregoing and the mutual covenants and stipulations set forth herewith, both Parties agree as follows:

1. General Provision

1.1. Fundamental Condition

The Dealer shall:

i. Take over existing Brand Stores in the Territory in accordance with Item 1 of Annex 4.

ii. Establish new Brand Stores in the Territory in accordance with Item 2 of Annex 4.

iii. Take over the specified Concession Corners locations, if any, in the Territory in accordance with Item 3 of Annex 4.

iv. Establish new Concession Corners locations, if any, in the Terrritory in accordance with Item 4 of Annex 4.

The Dealer’s right to retail the Products under this Agreement is conditional upon specific authorisation of each and all Authorised Outlets being given and not withdrawn by the Distributor as evidenced by an authorisation letter in the form set out in Annex 2. The Distributor may give or withdraw such authorisation at any time where there is a breach of the conditions contained within this Agreement, taking into account such factors as the Distributor may, in its absolute discretion think fit. The list of Authorised Outlets at any given time is set out in Annex 3, which list is subject to change from time to time.

The performance targets referred to in Item 11 of Annex 4 of this Agreement are irrefutably linked to the Dealers performance in its multi-branded business with the Distributor, the applicable terms and conditions agreed upon are contained in a separate General Trading Agreement.

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1.2. Definitions

The following terms as used in this Agreement shall have the meaning set forth below:

“adidas Group Standards of Engagement ” means the standards of engagement set out in Annex 11.

“Authorised Outlets” means the Brand Stores and Concession Corner locations that are authorised by the Distributor for the Dealer to sell the Products to consumers and end users, as per Clause 1.1 above.

“Brand” means the adidas® brand.

“Brand Store” means an exclusive retail adidas® concept store located within a shopping mall, department store or other retail location.

“Concession Corner” (Shop-in-Shop) means an adidas® mono branded sales location within a department store or other retail location, which is not enclosed and utilises Brand fixtures and fittings. In the case of this Agreement, the Product in the Concession Corners is sold to the Dealer on an outright basis.

“Confirmed Quantities” means the exact quantities of the Products that the Dealer is liable to purchase from the Distributor.

“Delivery Date” means the estimated date on which the Distributor will ship the Dealer’s ordered Products out of its warehouse for delivery as specified on the Distributor’s Order Form. This date is approximate only although the Distributor will endeavour to deliver on this date.

“Franchise Commercial Terms & Conditions” means the undertaking of business whereby the Distributor sells Products to the Dealer in accordance with the commercial terms and conditions set out in this Agreement including Annex 4.

“Distributor Sales Policies” means the sales polices set out in Annex 8.

“Distributor’s Order Form” means the Distributor’s standard form for recording details of the Products ordererd by the Dealer whether the same be Orders, Pre-Orders or Stock Orders.

“Future Order” means Orders placed by the Distributor after the Pre-Order cut-off but not for immediate delivery of one week or less.

“General Terms & Conditions of Trading” means the standard terms applicable to the sale of Products by the Distributor to the Dealer as set out in Annex 6.

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“Guaranteed Quantities” means 100% of the quantities of each Product ordered by the Dealer and accepted by the Distributor which the Dealer agrees to buy from the Distributor, and the Distributor agrees to supply to the Dealer.

“Order” means the Dealer’s irrevocable written offer to purchase the Products described in Clause 7.1 below and which offer is subsequently accepted by the Distributor resulting in a binding agreement to purchase the Products by the Dealer and includes all Stock Orders.

“Partial Delivery” means delivery of a portion of the total number of Products ordered. However, each article included in the Partial Delivery shall have a complete size run and quantity as ordered.

“Pre-Orders” means Orders placed at least four months prior to delivery during the Distributor Sell-in Meeting or pre-booking sessions for the following season. The Distributor may adjust the Pre-Orders program from time to time.

“Price” means the price for the Products (excluding carriage, packing, and insurance) and any applicable Goods and Service Tax (“GST”) or other sales related taxes, calculated in accordance with Clause 7.2 and specified in the Distributor’s Invoices.

“Products” means any Brand products sold by the Distributor to the Dealer as specified on the Distributor’s Order Form/or invoice in accordance with the terms of this Agreement.

“Promotional Items” means pamphlets, catalogues, advertising, promotional and sales materials relating to the Products including posters, visual marketing aids, signs, notices or displays and any other items whatsoever bearing any of the Trademarks.

“Quantities” means the quantities of each Product set out in the Distributor’s Order Form.

“Stock Order” means the ad hoc Order(s) relating to the Distributor’s excess Products which may be offered by the Distributor to the Dealer from time to time.

“Territory” means the geographical area of the Republic of Indonesia

2. Dealer’s Representations and Warranties

The Dealer hereby represents and warrants to the Distributor as follows:

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i. The Dealer is a company duly organised and registered under the law of the Territory, with full legal right, power and authority to execute and deliver this Agreement and to observe and perform its obligations hereunder.

ii. The Dealer shall observe the laws and regulations of the Territory and operate its business legally, and in compliance with the requirements of the adidas Group Standards of Engagement.

iii. The Dealer accepts that the Dealership Commercial Terms & Conditions contained in Annex 4, the General Terms & Conditions of Trading contained in Annex 6, the Distributor’s Sales Policies contained in Annex 8 and the adidas Group Standards of Engagement contained in Annex 11 form an integral part of this Agreement.

3. License of Rights

3.1 Grant of Non-Exclusive Rights

The Distributor hereby grants the non-exclusive right to the Dealer to set up and operate at the premises listed in Annex 3, an Authorised Outlet and grants to the Dealer a non-exclusive permit to use the Trademarks and the Know-How in connection with the operation of the Authorised Outlet and retailing of the Products designated from time to time by the Distributor.

As and when permitted by the Territory’s laws and regulations governing foreign investment, the Distributor reserves the right to open its own Authorised Outlets in the Territory and further reserves and retains its rights to sell the Products and grant licenses for the use of the Trademarks and the Know-How to other retailers and other adidas Dealers in the Territory, whether during or after the termination of this Agreement.

Subject to Clauses 3.2 and 3.3 below, the Distributor grants to the Dealer, the following non-exclusive rights during the Term of this Agreement:

i. To sell, to the exclusion of all other branded or non-branded products, which have not been previously the subject of discussions and agreement to the contrary between the Distributor and the Dealer, such Products as the Distributor notifies to the Dealer in writing from time to time as specified in Clause 7.1 and 7.2, at the Authorised Outlet located or to be located at the address stated in Annex 3 or at such other location agreed to in writing by the Distributor.

ii. To use at the Authorised Outlet, the Trademarks and the Know-How that the Distributor is licensed to use and which Distributor has notified to the Dealer it is entitled to use in writing, such use to be in

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accordance with the Distributor’s guidelines and/or instructions given by the Distributor to the Dealer from time to time, and as contained in Annex 7 to this Agreement.

No fee, howsoever described, is payable by the Dealer to the Distributor in return for the non-exclusive rights granted by this Clause 3.1.

3.2 Restrictions on Dealer

Other than following discussions between the Distributor and the Dealer, and with the prior written agreement of the Distributor or otherwise in accordance with this Agreement, the Dealer shall not:

i. Use the Authorised Outlet other than for the sale of the Products or sell, display or advertise for sale at the Authorised Outlet, any goods other than the Products.

ii. Purchase the Products from sources other than the Distributor.

iii. Sell the Products or use the name “adidas”, the Trademarks or Know-How at any location other than at the Authorised Outlet.

3.3 Reservation of Distributor’s rights

Without prejudice to the other provisions of this Agreement, the Distributor reserves the right:

i. To decline to accept any Order received from or through the Dealer.

ii. To sell the Products directly to its customers in the Territory (as and when permitted by the Territory’s laws and regulations governing foreign investment) or elsewhere as permitted by the adidas Group and whether through its own retail outlets, the Internet, by mail order or otherwise.

iii. To appoint other Dealers, agents and/or Distributors to sell the Products in the Territory or elsewhere as permitted by the adidas Group and to continue using existing Dealers in the Territory other than the Dealer. In the case, however, of those shopping malls, shopping centres or other retail locations agreed upon by the Distributor and the Dealer, the Distributor shall grant the Dealer exclusive rights in respect of operating mono-branded Brand Stores only. The operating of a Concession Corner in the Territory by the Dealer, if any, will be on a non-exlcusive basis. In the event that the Distributor appoints another Dealer to operate Brand Stores and/or Concession Corners for the sale of Products in the Territory, the

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Dealer shall not be entitled to any compensation, howsoever described, in connection with this appointment.

iv. To vary the price of the Products from time to time.

v. To vary the Products either by making changes to their design or packaging or in such other manner as the adidas Group shall think fit.

vi. To assign this Agreement to another adidas Group company for the remainder of the Term, after dutifully notifying the Dealer in writing of the assignment. The Distributor shall bear any reasonable legal costs associated with the assignment of this Agreement.

4. Duration of Agreement and Security

4.1 Term of Agreement

This Agreement shall be for an indefinite period of not less than one year commencing on 1 January 2007(“Commencement Date”), and remaining in effect unless earlier terminated by either Party in accordance with the provisions of Clause 10. The Franchise Commercial Terms and Conditions relating to this Agreement will be reviewed and mutally agreed between both parties annually prior to the Sell-in event relating to the sale of the products that would be affected by the revised Franchise Commercial Terms and Conditions, if any, and in any event, no later than the anniversary date of this Agreement (“Annual Review”). The revised Franchise Commercial Terms and Conditions, if any, will be effective for all open Authorised Outlets from the anniversary date of the Agreement relating to the review.

Each Authorised Outlet approved by the Distributor and opened by the Dealer under this Agreement will operate for a period of three (3) years in accordance with the General Terms and Conditions of Trading and the adidas Group Standards of Engagement, and should be co-terminus with the Dealer’s lease contract with the mall owner or lessor for the Authorised Outlet (“Lease”). In the event that the mall owner or lessor preterminates the Lease and offers another location for the Authorised Outlet, the authorisation for the individual Authorised Outlet is deemed to be automatically terminated, unless the Distributor agrees in writing to transfer the Authorised Outlet authorisation to the new location.

At the written request of the Dealer to be made between a maximum of twelve (12) months and a minimum of six (6) months prior to the expiration of the initial three year term of the Authorised Outlet, the Dealer shall approve a further consecutive term of up to three (3) years to operate the Authorised Outlet, on the same terms and conditions as apply at the end of the initial term subject to any specific changes too such terms and conditions negotiated and agreed between the Parties in respect of the consecutive

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term.

It is a condition precedent to the Distributor’s approval of the opening of an Authorised Outlet under this Agreement that, the Dealer must have complied with all of its obligations under this Agreement, and waived all and any claims that the Dealer has or may have against the Distributor in respect of this Agreement or related matters.

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4.2 Performance Security

As security for the Dealer’s performance of the terms of this Agreement (including for the Dealer’s payment obligations hereunder), the Dealer shall, within 14 (fourteen) days from the date of this signing Agreement (or such other period as may be agreed to in writing by the Distributor), deliver to the Distributor, an irrevocable bank guarantee (“IBG”).

The Dealer shall provide the IBG from a bank approved by the Distributor in an agreed format. The amount of the IBG shall be the amount of two month’s sales as determined mutually by the Dealer and the Distributor.

The IBG shall:

i. Be issued in favour of the Distributor.

ii. Guarantee payment of an amount of not less than the amount stated in Item 6 of Annex 4 (“Guaranteed Amount”).

iii. Be valid for a period of not less than 12 (twelve) months from the Commencement Date (or for such other period as may be agreed to in writing by the Distributor).

iv. Be substantially in the form of the example attached as Annex 10.

4.3 Renewal of IBG

So long as this Agreement is in force, whether during its initial term or any successive term following a renewal pursuant to Clause 4.2, the Dealer shall deliver to the Distributor, not less than 14 (fourteen) days prior to the expiry date of any IBG then applicable (“Guarantee Expiry Date”), a new and valid IBG issued in favour of the Distributor and, subject to the following changes, upon the same terms and conditions as those of the immediately preceding IBG (or upon such other terms as may be agreed to in writing by the Distributor):

i. The validity period of the new IBG shall be the relevant renewal term commencing immediately after the Guarantee Expiry Date.

ii. If the Distributor shall have notified the Dealer in writing not less than 30 (thirty) days prior to the Guarantee Expiry Date that the new IBG must guarantee payment of an amount other than the amount stated in the immediately preceding IBG, the Dealer shall deliver to the Distributor a new IBG for the Guaranteed Amount stated in the Distributor’s written notice aforesaid.

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5. The Image of the Authorised Outlet, Furniture and Equipment

5.1 Authorised Outlet Identity

The Dealer shall maintain the image and outlook of the Authorised Outlet, including the showcases, fittings, fixtures and equipment therein in conformity at all times with the Brand’s identity as a global brand of high quality and shall, for such purpose, consult personnel appointed by the Distributor from time to time as to the standards of maintenance required and comply with their directives and proposals for such maintenance.

Unless the Distributor otherwise agrees in writing, the Dealer shall:

i. Ensure that all showcases in the Authorised Outlet display the Products exclusively.

ii. Comply with guidelines issued by the Distributor from time to time as to the range of Products which the Dealer is to purchase from the Distributor for sale at the Authorised Outlet.

5.2 Fitting Out & Furniture and Equipment

The Dealer shall structure, decorate and equip the interior and exterior of the Authorised Outlet in conformity with the Brand design specifications and, where required, using designated adidas Group suppliers (as communicated from time to time to the Dealer), and in accordance with the plans previously submitted to and approved by the Distributor and utilising the services of designers, supervisors and contractors previously nominated or approved by the Distributor. Any alteration to the approved plans shall be subject to the Distributor’s prior written consent.

The Dealer shall purchase and install in the Authorised Outlet all necessary equipment, including but not limited to software and hardware equipment, air conditioners, audio equipment ("Equipment"), as previously approved by or specified from time to time by the Distributor. Title to the Equipment shall remain with the Dealer. The costs of fitting out the Authorised Outlet, inclusive of wet-work, electrical and ceiling works is to be borne by the Dealer, with the cost of the Brand moveable fixtures and display modules ("Furniture") and all other fixtures and fittings that are directly attributable to the Brand supplied by the Distributor (“Other Distributor Supplied Items”), being borne by the Distributor. The Dealer shall install at its own cost in the Authorised Outlet, the Furniture and Other Distributor Supplied Items specified and supplied by the Distributor.

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The Dealer is responsible for all payments to and the performance of the contractors used to fit out or subsequently renovate the Authorised Outlet. The Dealer shall ensure that all fit out works comply in all respects with all applicable laws, rules, regulations, by-laws and the like (“Laws”) and obtain all requisite approvals, permissions, consents and the like (“Approvals”) whether of municipal, local or other authorities (“Authorities”) or of the owner of the building (“Building Owner”) in which the Authorised Outlet is situated. The Dealer shall indemnify and keep the Distributor indemnified against all liabilities, claims, proceedings, damages, costs and expenses incurred by the Dealer to either the Authorities or the Building Owner as a result of or in relation to a breach of the Laws or Approvals.

5.3 Renovation and Maintenance

Without prejudice to the generality of Clause 5.2, when required by the Distributor to do so, the Dealer shall carry out a renovation program of the interior and exterior of the Authorised Outlet at the following times:

i. Where the Authorised Outlet is to be established as a new outlet for the sale of the Products:

- Prior to the commencement of any sale of the Products.

- Thereafter at such times as the Distributor deems appropriate but in any event, once in every three years from the date of the immediately preceding fitting out.

ii. Where the Authorised Outlet is an existing outlet for the sale of the Products:

- At such time as the Distributor deems appropriate.

- Thereafter at such times as the Distributor deems appropriate but no later than three years from the date of the immediately preceding fitting out.

The Dealer shall operate a maintenance program to maintain at all times the interior and exterior of the Authorised Outlet in good condition. The Parties shall use their best endeavours to agree on the renovation of the Authorised Outlet within fourteen days (or such longer period as the Distributor stipulates) from the commencement of their consultations on the renovations. Failing agreement, the Distributor’s proposal on renovation or on such items thereof as the Parties shall have failed to agree upon, shall, for the purposes of this Agreement, be deemed to be agreed to and binding upon the Dealer.

If, at any time, the Distributor is reasonably of the opinion that the Dealer is not complying with its renovation and maintenance obligations, the Distributor may, without prejudice to any other remedy available to it, including termination of this Agreement, notify the Dealer of the actions it

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requires from the Dealer in order to ensure compliance with such obligations, and the Dealer shall, at its own expense, take the notified action forthwith within 14 (fourteen) working days.

The Dealer will undertake any renovation and maintenance program in compliance with the requirements of Clauses 5.1 and 5.2. This may include renovation or replacement of the Equipment, Furniture and Other Distributor Supplied Items and updating the fascia, image, lay-out and style of the Authorised Outlet by carrying out all refurbishment work deemed necessary by the Distributor, so as to comply with the latest Brand design and image. The cost of the renovation and maintenance program shall be shared between the Distributor and the Dealer. The costs of fitting out, inclusive of wet-work, electrical and ceiling works to update the fascia, image, lay-out and style of the Authorised Outlet, and the cost of renovating or replacing the Equipment shall be borne by the Dealer. The cost of renovating or replacing the Furniture and the Other Distributor Supplied Items shall be borne by the Distributor. The Dealer shall install at its own cost in the Authorised Outlet the Furniture and Other Distributor Supplied Items specified and supplied by the Distributor. All expenses relating to the maintenance of and risk of loss to the Furniture and Other Distributor Supplied Items shall be borne by the Dealer from the date of delivery to the Dealer.

5.4 Title to Furniture and Other Distributor Supplied Items

The title to the Furniture and Other Distributor Supplied Items will remain with the Distributor for a period of one year from the date of their initial acquisition. The Dealer shall not sell the Furniture and Other Distributor Supplied Items or otherwise create or permit to be created any charge, lien, assignment or other encumbrance, equity or security interest whatsoever over the Furniture and Other Distributor Supplied Items. In particular, the Dealer shall ensure that the Furniture and Other Distributor Supplied Items are expressly excluded from any security interest over its assets and are not transferred to a third party pursuant to the exercise of the statutory pledge securing a lessor's claims for overdue rental fees, or as a result of any execution procedure. The Dealer shall promptly notify the Distributor of, and take all possible actions against, any such event threatening the Distributor's title to the Furniture and Other Distributor Supplied Items.

The Dealer shall compensate the Distributor for any breach by the Dealer with respect to protecting the title to the Furniture and Other Distributor Supplied Items. Compensation shall be the highest of the cost of replacement, the market value or the Distributor’s book value (as applicable) of the Furniture and Other Distributor Supplied Items.

Upon sale of any of the Equipment and Other Distributor Supplied Items by

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the Dealer to any third party, all Trademarks affixed to such items shall be removed by the Dealer.

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6. Operation of the Authorised Outlet

6.1 General

The Dealer shall commence or continue, as the case may be, the operation of the Authorised Outlet not later than the date specified in Annex 3, in accordance with the terms of this Agreement.

The Dealer shall ensure that the image and reputation of the Distributor and of the Brand are at all times maintained to the reasonable satisfaction of the Distributor and that nothing which may be detrimental to that image or reputation is carried out by the Dealer or its employees. The Dealer shall use its best efforts to maintain the highest standards in all matters connected with the operation of the Authorised Outlet and shall comply with all advice and instructions given to it by the Distributor with regard to the display and sale of the Products.

The Dealer shall use the Trademarks and other signs in accordance with the Distributor's instructions solely and in connection with the operation of the Authorised Outlet, and shall refrain from using the Trademarks or any other name, sign, symbol or colour scheme in any way that has not been previously approved in writing by the Distributor.

The Dealer shall use the Know-How only in connection with the operation of the Authorised Outlet and in accordance with the Distributor's instructions.

6.2 Shop Staff

The Dealer shall employ an adequate work force which, in the opinion of the Distributor, will enable the Authorised Outlet to operate efficiently, including a full time manager (the "Manager" and collectively the "Staff").

The Dealer shall ensure that the members of the Staff attend such training courses and seminars with regard to the operation of the Authorised Outlet as may be organised by the Distributor from time to time. The Dealer shall, in addition, maintain a training program for the Staff as prescribed by the Distributor. Unless the Distributor decides otherwise, the Dealer shall bear the costs for the attendance and participation of the Staff at and in such training programs.

The Dealer shall comply with all instructions given to it by the Distributor with regard to the Staff’s uniforms, appearance, cleanliness and demeanor, which in the opinion of the Distributor, are reasonably necessary in order to maintain the uniformly high standards associated with Authorised Outlets as detailed in Annex 9. The Dealer shall, at its own cost, provide uniforms for all Staff as designed and supplied by the Distributor.

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6.3 Other

The Dealer shall ensure that all POSM bags or carriers, giveaways, purchase with purchase or gifts with purchase, materials, invoices or other stationery used by the Dealer in connection with the Authorised Outlets are in the form designated by and in accordance with the specifications of the Distributor and the same may either be purchased at cost from the Distributor or, with the prior approval of the Distributor, procured elsewhere from other sources.

7. Purchase, Sale and Promotion of the Products

7.1 Purchase of Product

All purchases of the Products by the Dealer directly from the Distributor shall be governed by the Franchise Commercial Terms and Conditions attached as Annex 4, and the General Terms and Conditions of Trading attached as Annex 6, subject to the differences contained in this Clause 7. In the event that the General Terms and Conditions of Trading are amended by the Distributor then, with the agreement of both Parties from time to time, the same amendments shall apply to this Agreement as from the date of such amendment.

The Dealer shall send Orders to the Distributor from time to time. All Orders shall be addressed to the Distributor at the legal address set forth herein, or to such other address as may subsequently be notified to the Dealer by the Distributor.

Other than as previously discussed and agreed in writing with the Distributor, the Dealer shall purchase the Products exclusively from the Distributor. If the Dealer operates more than one Authorised Outlet, the Dealer has the right to transfer Products between the Authorised Outlets operated under its control at its own will for the ultimate sale exclusively to retail consumers.

The Dealer shall participate in the Distributor’s Pre-Orders program. Under this program, the Dealer shall submit its Pre-Orders to the Distributor at least five (5) months before the intended delivery date, or if shorter, within the prescribed period following the Sell-In meeting as stated at the applicable Sell-In meeting. Such Pre-Orders will be subject to the Distributor’s General Terms and Conditions of Trading, as the same apply to Stock Orders, and any specific terms and conditions with respect to the Pre-Order program for the Product season shall be communicated to the Dealer no latter than at the time of the appropriate sell in meeting. Any Pre-Order discounts are deemed to be inclusive within the Dealer’s contractual discount.

If the delivery time for an Order is less than that required for a Pre-Order as

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defined in the previous paragraph, but more than one week in the future, such Order is referred to as a “Future Order”, and the terms of the Future Order will be subject to the Distributor’s General Terms and Conditions of Trading as applicable to Future Orders. Orders for delivery within one week will be referred to as “Stock Orders” and such Orders will be subject to the Distributor’s General Terms and Conditions of Trading, as the same apply to Stock Orders.

All Orders of any type by the Dealer are to be made on a Distributor’s Order Form issued and signed by an Authorised Representative of the Dealer. An Order of any type shall become binding on the Parties only when the Distributor provides the Dealer with a Sales Order Confirmation (“Order Confirmation”). The Dealer is required to notify the Distributor of any errors on the Distributor’s Order Form within seven days, after which it will be deemed to be correct and final. All Orders are governed by the terms of this Agreement and the Distributor’s General Terms and Conditions of Trading, which take precedence over any conditions attached to the Distributor’s Order Form.

The Dealer may place Orders provided the aggregated amount of all outstanding amounts due by the Dealer to the Distributor does not exceed the Dealer’s agreed credit limit, and that none of its payables to the Distributor are overdue. Where the Dealer neglects to make timely payment for the Products, the Distributor has the right, at its discretion, to cancel any open Orders.

The Dealer undertakes and commits to use its absolute best efforts to purchase from the Distributor the minimum amounts of the Products stated in Item 11 of Annex 4 (“Mininum Purchase Guarantee”). Should the Dealer fail to comply with the Minimum Purchase Guarantee, the discount it is entitled to as a “market model” may, in the absolute discretion of the Distributor, be reduced by the percentage specified in Item 7 of Annex 4, being the equivalent of the Distributor’s Pre-Order Discount. At the end of each calendar year, a reconciliation of the total prior year purchases made by the Dealer shall be done for purposes of calculating the correct discount rate to be applied and a debit or credit note shall be issued by the Distributor to the Dealer.

7.1.1 Delivery, Transportation and Insurance

The Distributor shall use its best efforts to ship the Products to the Dealer on the agreed delivery date and to the address shown on the Sales Order Confirmation, including arranging transportation and related insurance. All relevant transportation and insurance costs by land or sea delivery for Orders meeting minimum quantities shall be borne by the Distributor unless otherwise agreed by both Parties.

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The Dealer shall bear any extra costs associated with supplying the Products to Authorised Outlets on an expedited basis, where this is not the result of late delivery by the Distributor. In all cases, the costs associated with any subsequent movement of the Products, such as for clearance, shall be borne by the Dealer.

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If delivery of a portion or all of the Products cannot be made on the delivery date despite the Distributor’s best efforts, the Distributor shall promptly notify the Dealer of the same and both Parties shall discuss how to respond to the situation. The Distributor shall not be liable for any delays in the delivery of the Products.

Upon receipt of the Products, an authorised representative of the Dealer shall sign and date the transportation company delivery note (“Delivery Note”). By signing and dating the Delivery Note, the Dealer shall be deemed to have accepted (“Shipment Note”) and received delivery of the Products appearing on the Distributor’s shipment note on the signing date. If there is any damage to the packaging carton(s) of the received Products, the Dealer shall immediately count the content of the damaged carton(s) in the presence of a representative of the transportation company and note the result of counting on the Delivery Note, and report the damages and discrepancies between received Products and the Shipment Note within seven (7) days after receipt of the above-said Products.

In case the Dealer finds defective Products, it shall handle this issue according to the Distributor’s Defective Product Return Policy specified in Item 27 of Annex 4.

7.1.2 Risk & Title

Subject to the immediately following paragraph, the title to the ordered Products transfers to the Dealer upon shipment out of the Distributor’s warehouse, with the shipment out being subject to a sales cut-off date at the Distributor’s financial year end. Risk of damage including destruction, loss, change of quality and any other damage after the receipt by the Dealer of the Products at the agreed delivery address shall be borne by the Dealer and such risk of loss before the receipt of the Products by the Dealer shall be borne by the Distributor.

The Distributor reserves retention of title over the Products until they have been paid for in full by the Dealer, as well as the right to recover them from the Dealer’s premises if the Dealer fails to pay for the Products by the due date, is declared bankrupt or enters into voluntary or compulsory liquidation or administrated receivership.

7.2 Sale of Product

The Dealer shall sell exclusively the Products designated from time to time by the Distributor in the Authorised Outlet and exclusively to retail consumers.

The Dealer shall keep a selection of the Products according to the Product launch calendar, in such types, sizes, colors and quantities to fully satisfy

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consumer-demand and as required by the Distributor. For this purpose, the Dealer agrees the Distributor may, at its discretion, provide the Dealer with select styles of the Products, referred to as “points of differentiation” (PODs), and/or a mandatory product range, under such terms and conditions as may be agreed upon by the Parties. Notwithstanding this, the Distributor may unilaterally determine up to that percentage of Product selection for the Authorised Outlet as is specified in Item 13 of Annex 4 in order to ensure proper adidas brand and technology representation in the Authorised Outlet.

The Dealer shall use its best efforts to maximise the turnover of the Authorised Outlet and, achieve as a minimum turnover figure, the amounts indicated in Item 11 of Annex 4 (the "Minimum Turnover Figure") in each consecutive twelve-month period. In achieving these targets, the Dealer is entitled to receive a Dealer bonus equal to the agreed percentage (as specified in Item 12 of Annex 4) of the Dealer’s net purchases from the Distributor. The Dealer bonus shall be paid by way of issuing a credit note which will be applied against the next invoice issued to the Dealer pursuant to any delivery of the Products.

Without prejudice to the Dealer's right to determine its retail prices, the Distributor may, by taking advantage of its expert knowledge in evaluating market conditions and developing marketing policy, continuously recommend retail prices to the Dealer by Article or Model number (“Recommended Retail Prices”) at which the Dealer shall retail and only sell the Products at these Recommended Retail Prices. The Distributor shall not mark-down the Product from the Recommended Retail Prices prior to 90 days of the date of the introduction. In any situation where the Dealer believes that it would be commercially desirable to sell the Products at less than the Recommended Retail Prices prior to 90 days from their date of introduction, the Dealer shall only mark-down the Products from the Recommended Retail Prices following consultations with the Distributor and the reaching of a consensus with the Distributor on the commercial desirability of such mark-downs from the Recommended Retail Prices. In the event of a breach of this obligation:

i. The Dealer shall pay to the Distributor an amount equivalent to the difference in value between the Recommended Retail Price and the price at which the Dealer sold the Products.

ii. The Distributor shall be entitled to terminate this Agreement.

The maximum discount from the Recommended Retail Price for the sale of Products in the Authorised Outlet shall be as specified in Item 16 of Annex 4. Discount sales of Products may not exceed the percentage of the total monthly sales in the Authorised Outlet as specified in Item 16 of Annex 4.

Save for the competitive brand(s) that the Dealer is currently selling and the Distributor is fully aware of and has consented to the same or as otherwise discussed with and agreed in writing by the Distributor, the Dealer shall

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refrain from participating, directly or indirectly, in the distribution or promotion of any product which is competitive with the Products, unless with the Distributor’s prior written consent.

Should the Dealer become aware of, or reasonably suspect, any wholesale activity with the Products by any unauthorised person, the Dealer shall promptly inform the Distributor accordingly.

The selling or displaying of counterfeit Products by the Dealer in the Authorised Outlet shall result, at the discretion of the Distributor, in the immediate termination of this Agreement.

The Dealer shall use its best efforts to achieve the Authorised Outlet performance targets specified in Item 11 of Annex 4.

7.3 Promotion of Product

The Dealer shall follow the Distributor’s instructions in respect of the promotion of the Products and the Authorised Outlet. The Dealer shall prominently display inside and outside the Authorised Outlet the Promotional Items or other POS materials supplied to the Dealer by or on behalf of the Distributor, the supply of which is at the cost to the Distributor. The Dealer may, at its expense and independently from the Distributor, carry out advertising relating to the Authorised Outlet and/or the Products, provided that the Distributor shall have given its prior written consent to each advertising campaign. In addition, the Dealer shall also take part in the promotion campaigns or events and merchandising organised by the Distributor and notified to the Dealer in writing from time to time. No direct advertising for discount Product sales is allowed.

The Dealer shall allocate the minimum percentage of its Gross Annual Sales specified in Item 18 of Annex 4 for joint advertising and sales promotion campaigns co-ordinated by the Distributor, from which the percentage of Gross Annual Sales specified in Item 18 of Annex 4 shall be paid by the Dealer to the Distributor’s Marketing Advertising Fund (“Fund”). The Fund shall be used by Distributor to sustain its efforts in advertising for the Brand and specifically for the Authorised Outlet. The contribution to the Fund shall be billed monthly by the Distributor to the Dealer. The Dealer shall pay the amount within ten (10) days from receipt of the statement of account.

Without prejudice to the generality of the above, the Distributor and the Dealer hereby agree to conduct joint promotion and advertising campaigns during the term of this Agreement. For this purpose, the Distributor and the Dealer shall meet quarterly to discuss and agree on the budget, scale and activities in connection with such joint promotion and advertising campaigns and the contribution by each Party towards such budget or fees required to mount the said joint promotion and advertising campaign.

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The Dealer may only establish a web site or other form of presentation, advertising and/or sale of the Products on the Internet with the written approval of the Distributor. In any event, any advertising and promotional activities on the internet must conform to the global advertising and promotional policies of the adidas Group.

The Dealer shall at all times protect and promote the interest, reputation and goodwill of the adidas Group, the “adidas” name, the Brand, the Products and the Trademarks.

The Distributor shall provide and bear the cost of the POS material to be displayed in the Authorised Outlet. The Distributor and the Dealer shall also comply with the additional Product marketing, promotion and sales obligations for the Territory, if any, specified in Item 19 of Annex 4.

8. Dealer’s Obligations

8.1 Positive Covenants

The Dealer shall:

i. Refrain from representing itself as an affiliate or agent of the Distributor or pledge the Distributor’s credit, and shall clearly and prominently indicate its status as an independent undertaking. Such indication, however, shall not interfere with the common identity of the Brand Store and/or Concession Corner location network resulting in particular difference deviation or departure from the common name or shop design and uniform appearance of the Authorised Outlet.

ii. Observe and follow the Distributor’s Sales Policies listed in Annex 8, the General Terms and Conditions of Trading in Annex 6 and the adidas Group Standards of Engagement in Annex 11, which are subject to updates and amendments from time to time by the Distributor, with written notice to the Dealer with immediate effect or effective at a specified date.

iii. Only sell the Products to end consumers at the Authorised Outlet as listed in Annex 3, which is subject to updating upon the granting of new authorisation(s) or cancelling of existing one(s). If the Dealer desires to sell Products at locations other than the Authorised Outlet listed in Annex 3, prior written approval of the Distributor is required. Except in situations previously discussed with and agreed to in writing by the Distributor, the Dealer agrees not to sell the Products to any person or third party, which it knows or has reasonable cause to believe is purchasing the Products with the intention of resale within or outside of the Territory .

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iv. Monitor and record all Product sales at the Authorised Outlet with POS terminals and give the Distributor on-line access to all sales data recorded on POS terminals.

v. Be responsible for and bear all recurring charges and expenses whatsoever incurred or to be incurred in operating the Authorised Outlet.

vi. Only use POS terminals at the Authorised Outlet as approved by the Distributor at the Dealer’s own cost.

vii. Communicate to the Distributor any experience gained during the operation of the Authorised Outlet, however, it shall not introduce any improvement, or modification into the operation of the Authorised Outlet without the Distributor's prior written consent. The Distributor shall have the right to integrate into the Know-How any such improvements without any payment being made in respect thereof.

viii. As soon as practicable, notify the Distributor in writing of any suspected unauthorised use of any of the Trademarks or the Know-How by third parties, or any act of unfair competition by third parties relating to any of the Trademarks or other signs or symbols used in connection with the operation of the Authorised Outlet. The Dealer shall not take any action against such infringement or unfair competition unless prior written approval is given by the Distributor. If the Distributor decides, in its discretion, to take judicial action against such infringement or imitation, the Dealer shall provide such co-operation as the Distributor may request in connection with any such action. The Distributor will have the right to conduct any such action and shall be obliged to pay all legal expenses and costs which may arise as the result of joining of the Dealer as a party, except legal expenses and costs which the Dealer may incur by obtaining separate legal advice.

ix. Permit the Distributor or his agent or employee the right to enter, during normal business hours, the premises of the Authorised Outlet, including its store-rooms and offices, and to inspect the inventory, any accounts or records and to take copies thereof at the Distributor's expense.

x. Fully comply on a timely basis, with all laws and regulations of the Territory including, without limitation, those specific laws, if any, mentioned in Item 9 of Annex 1.

xi. Obtain and maintain a Sales Tax (VAT collector) registration

xii. Be responsible for any damage, injury, risk caused by or in relation with Distributor supplied promotion materials and display materials including but not limited to fixtures, decoration materials, POP material

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and outfitting items.

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xiii. Compensate the Distributor for any use by the Dealer of the Trademarks and Know-How otherwise than in accordance with this Agreement.

xiv. Indemnify the Distributor for any liability incurred to third parties for any use of the Brand Trdemarks or intellectual property belonging to such third parties.

xv. Deliver to the Distributor within three months of its year end a copy of financial statements.

8.2 Negative Covenants

The Dealer shall not:

i. Do or fail to do anything which would, in any way, impair the rights of the Distributor or the proprietor of the Brand and the Trademarks, or which would depreciate the value and/or reputation of the Brand or the Trademarks. In particular, it is prohibited to apply to register any of the Trademarks or any part thereof, or a name phonetically similar to the Trademarks in the Dealer's own name or in the name of any associated or related entity of the Dealer. The Dealer is not entitled to grant licenses to third parties to use any of the Trademarks or to operate sub-Dealer Authorised Outlets.

ii. Tamper with Products or any of the markings, name plates, indications of origin or instructions on them or any packaging supplied by the Distributor, but sell the Products in the same condition as that in which it receives them.

iii. Carry on the its business as a retailer of the Products (“Business”) or any part of that Business other than from the Authorised Outlets without prior discussions with and the written agreement of the Distributor.

iv. Appoint or authorise any person or entity to act as its sub-Dealer, subsidiary or agent in respect of the performance of any of the Dealer’s obligations under this Agreement.

v. Make any representation to consumers or give any warranties in the name of the Distributor other than as permitted by the Distributor.

vi. Hold itself out as the agent or representative of the Distributor except as expressly authorised by this Agreement, and in all correspondence and other dealings relating directly or indirectly to the sale or other disposition of the Products, shall clearly indicate that it is acting as principal. Without limiting the generality of the foregoing, the Dealer shall not, without the prior written approval of the Distributor, register or apply to register itself with any authority, government department or organisation in the Territory as the sole or exclusive

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agent, Dealer, or representative in the Territory of the Distributor.

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vii. At any time cause or permit anything which may damage or endanger the Distributor’s title to the Trademarks and Know-How or assist or allow others to do so.

viii. Use the Trademarks and Know-How other than as permitted by this Agreement and directly in its business as an authorised Dealer in the Products.

ix. Use without prior approval of the Distributor, the Trademarks on any stationery, store sign, paper bags, light boxes, leaflets, internet web site and other promotional and advertising material for the Products.

x. Seek any privilege or favour by offering cash, coupons, valuable gifts, excessive entertainment to the Distributor’s employees, as well as by other non-professional behavior beyond normal business practice, and shall inform the Distributor of any non-professional behaviour on the part of the Distributor’s employees, if any.

xi. Do or refrain from doing anything which amounts to a breach of the laws of the Territory including, without limitation, those specific laws, if any, mentioned in Item 9 of Annex 1.

8.3 Insurance

The Dealer shall take out and maintain for the duration of this Agreement an insurance policy, or modify its existing insurance policy as required by the Distributor, within 15 days from signing this Agreement, so as to be reasonably satisfactory to the Distributor, at the Dealer's expense, and with an insurance company of good reputation, against all reasonably foreseeable risks, including;

i. All risks insurance covering loss (including loss of profits) or damage to or destruction of the Authorised Outlet and of the Products on sale which may arise from fire, flood, explosion, vandalism or burglary, third party liability and all other foreseeable risks.

ii. Public liability insurance to cover any expenses, liabilities, losses, claims or proceedings which the Dealer may incur or sustain by reason of damage to any property of the Distributor or injury to any customers in the Authorised Outlet, including personal injuries or deaths arising out of, or in the course of or caused to any third party in the Authorised Outlet.

iii. Workmen's compensation or employer's liability and other insurance as may, in the Distributor’s absolute discretion, be deemed to be necessary to cover the liability of the Dealer.

The Dealer will provide the Distributor with a copy of the insurance certificate and the subsequent renewal certificates, and ensure that the

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insurance policy or policies are endorsed with provisions that their cancellation shall not be effected without prior written notification to the Distributor.

The Dealer shall utilise all insurance monies received by it (whether on any insurance of the property and effects belonging to the Dealer in the Authorised Outlet) firstly towards payment of all monies payable by the Dealer to the Distributor (including without limitation to all compensation payable by the Dealer to the Distributor pursuant to this Agreement).

8.4 Reporting

The Dealer shall provide soft copy sales and inventory information in a format and frequency required by the Distributor including, without limitation:

i. Monthly Sales and Inventory Report including sell though data by Authorised Outlet and total to be submitted on every first Monday of the month.

ii. Monthly a report of all matters of importance affecting each Authorised Outlet, including advertising and promotional activities.

The Dealer shall at all times inform the Distributor of its selling prices for all Products which are not at the Recommended Retail Price or within the mark down schedule in Item 16 of Annex 4.

9. Distributor’s Obligations

The Distributor shall:

i. Undertake to continuously provide the Dealer during the term of this Agreement with instructions, advice, know-how and guidance relating to the management, personnel recruiting, finance, promotion and methods of operations to be applied with respect to the operation of the Authorised Outlet. Notwithstanding anything to the contrary herein contained, it is recorded that the nature and extent of the advice and assistance to be given by the Distributor will, at all times, be within the sole and entire discretion of the Distributor.

ii. Inform the Dealer of any alterations to the Know-How, the marketing strategy or any other changes which might have an effect on the operation of the Authorised Outlet, and shall allow a reasonable deadline for the Dealer to introduce such changes and to comply with the Distributor's instructions.

iii. Within a reasonable period of time, evaluate and provide a response on the merits of any notifications, plans or proposed modifications in connection with the operation of the Authorised Outlet submitted by the Dealer pursuant to this Agreement for the Distributor's

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consideration or approval.

iv. Undertake to provide the Dealer with the necessary training in merchandising support in the form of product display, display modules, fixtures and fittings, point-of-purchase (POP) and merchandising materials such as posters, banners, window displays, signage, etc. In addition, the Distributor may provide merchandising support such as flyers and streamers.

v. Arrange for the delivery of the Furniture and Other Distributor Supplied Items to the Authorised Outlet for its set up at the Dealer's expense in time to enable the Dealer to commence the operation of the Authorised Outlet on the date specified in Annex 3.

vi. At its sole discretion, take all actions as it may deem necessary to protect the Dealer against any unauthorised use of the Trademarks or the Know-How, which may adversely effect the operation of the Authorised Outlet.

v. Assure the Dealer that, should an opportunity arise to set up another Brand Store in the vicinity (defined as within the same shopping mall, complex or centre) of the Dealer’s Brand Store, the Distributor will grant the Dealer a “right of first refusal” in respect of the other Brand Store only.

vi. Support the Dealer in its efforts to sell the Products through providing adequate advertising and promotion of the Products at such times and in such manner as it considers fit. The Distributor shall provide such marketing support to the Dealer as the Distributor shall consider necessary for the Dealer to fulfil its obligations under this Agreement

vii. Promptly communicate with the Dealer about new Product information, including but not limited to Product ranges and prices, and alterations to the information concerning the Products.

viii. Promptly communicate with the Dealer about all updates of the Distributor’s sales policies and assist the Dealer in observing these policies.

ix. Reserve the express right, notwithstanding anything to the contrary contained in this Agreement, to change or depart from any descriptions and information in its leaflets, catalogues or any other documents in relation to the Products or the method of construction or of the use of materials in respect of the Products without any prior notice.

x. Accept the return of defective Products in accordance with the Distributor’s Defective Product return policy specified in Item 27 of Annex 4, and in any event, no longer than a period of one year from the date of invoicing.

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xi. Insure at its own cost and solely in the name of the Distributor, all such items in the Authorised Outlet in which the Distributor has an insurable interest (including, without limitation, the Furniture and the Other Distributor Supplied Items) against loss or damage by fire and all such other risks in such amounts and with such insurers as the Distributor may, from time to time, deem appropriate. The Dealer confirms and acknowledges that all monies payable under any insurance policy/policies affected by the Distributor shall belong to the Distributor absolutely.

10. Termination

10.1 Termination by Both Parties

This Agreement may be terminated at any time by the mutual agreement in writing of both Parties.

10.2 Termination by Either Party for Cause

This Agreement may be terminated for cause by either Party by serving written notice thereof to the other party of at least sixty (60) days prior to such termination. Notwithstanding the above, this Agreement may be terminated, with immediate effect, by written notice given by either Party to the other Party, at any time, if the other Party:

i. Commits any material breach of the terms and conditions of this Agreement, which breach is not capable of being remedied.

ii. Fails to remedy any breach of this Agreement, which breach is capable of being remedied, within fourteen (14) days following receipt of a written notice of default requesting the other Party to remedy the breach.

10.3 Termination by Either Party without Cause

This Agreement may be terminated with immediate effect by written notice given by either Party to the other Party, where the other Party:

i. Is declared bankrupt or is otherwise unable to discharge its financial obligations as they become due, is the subject of an interim or permanent debt moratorium order, is liquidated, or otherwise ceases to carry on business for any reason.

ii. Commits an act of bankruptcy, is unable to pay its debts when they fall due, has a bankruptcy or winding-up petition presented against such Party, or has a receiver and/or administrative manager appointed over all or any part of its undertaking and assets or an order for court (whether provisional or final) made or a voluntary or compulsory

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resolution passed for its winding-up.

iii. Is placed under judicial management or enters or attempts to enter into any compromise or arrangement with its creditors.

iv. Is the subject of a distress notice or execution, or other process of a court of competent jurisdiction levied upon or issued against the other Party’s property and such distress, execution or other process as the case may be, is not satisfied by such Party within 14 (fourteen) days from the date thereof.

v. Is unable to continue fulfilling its obligations under this Agreement for six (6) months or more due to an event of Force Majeure and, after consultations, the Parties are unable to agree on a method to improve their economic situation to an extent satisfactory to both Parties.

10.4 Termination by Distributor

The Distributor shall have the right to terminate this Agreement immediately, at any time, by giving written notice of such termination to the Dealer upon the occurrence of any of the following events:

i. If the Dealer is a company, when there is a change (whether directly or indirectly) in the identity of or in the ownership of the party controlling the Dealer without the prior written consent of the Distributor to such change (which consent may be withheld or granted with or without conditions by the Distributor in its absolute discretion).

ii. Any circumstance arises or event occurs which, in the Distributor’s reasonable opinion (which shall be final and binding on the Dealer), has an adverse effect or may have an adverse effect on the sale of the Products or on the Brand or the Trademarks.

iii. Any circumstance arises or event occurs which, in the Distributor’s reasonable opinion (which shall be final and binding on the Dealer), may adversely affect the Dealer’s ability to fulfil its obligations under this Agreement, including its payment obligations.

iv. The Dealer is wound-up, becomes insolvent or is deemed unable to pay its debts, or is subject to any application or any procedure for winding up or corporate reorganisation, except for the purpose of and followed by a reconstruction, or amalgamation without insolvency, or if the Dealer enters into negotiations for an arrangement or composition with or for the benefit of its creditors, or a liquidator, receiver or manager is appointed in relation to the Authorised Outlet or any part of it or any part of its assets or the Authorised Outlet or the Products or any part thereof is lawfully seized as payment or security for payment or any procedure of similar effect to any of the foregoing is

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commenced or any other event occurs that causes its dissolution.

v. The Dealer defaults on any of its payment obligations under this Agreement and as stipulated in the Franchise Commercial Terms and Conditions or the General Terms & Conditions of Trading, or subsequently fails to pay its overdue and outstanding liabilities to the Distributor within 14 (fourteen) days when the Distributor demands payment of the same.

vi. The Dealer fails to deliver a valid Irrevocable Bank Guarantee to the Distributor in accordance with the terms of this Agreement.

vii. The Dealer imports or purchases the Products from any source other than the Distributor without the Distributor’s prior written approval and/or if the Dealer exports/sells the Products to any person other than the consumers permitted under this Agreement or as specifically agreed to in writing by the Distributor.

viii. The selling or displaying of counterfeit Products by the Dealer in its Authorised Outlet.

ix. The performance of the Dealer is such that it fails to achieve the Minimum Turnover Guarantee.

x. The Dealer fails to commence or cease the operation of the Authorised Outlet by the date specified in Annex 3 or to carry out the renovation and maintenance program in accordance with the requirements of this Agreement.

xi. The Dealer infringes in any way the rights of the Distributor or of the proprietor of the Trademarks to the Trademarks, or fails to promptly notify the Distributor of any suspected unauthorised use of any of the Trademarks or the Know-How.

xii. The Dealer shall be or attempts to act in breach of any of the covenants and undertakings set out within this Agreement.

xiii. The Dealer provides to the Distributor at any time false or misleading information, or omits to disclose to the Distributor any material fact, the non-disclosure of which renders any statement made by the Dealer to the Distributor misleading, or fails to inform the Distributor of any change which may have a material effect on this Agreement.

xiv. The Dealer divulges Confidential Information to unauthorised third parties.

xv. If the Distributor ceases to be the exclusive Distributor of the Products in the Territory, whether by its own default or otherwise.

The Distributor may also terminate this Agreement by giving six (6) months notice in writing to the Dealer at any time on or after the initial period of one year from the date of commencement of this Agreement.

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10.5 Consequences upon Termination

The expiration or termination of this Agreement shall not relieve either Party of any obligation under this Agreement, which is expressed to continue after expiration or termination or any of their prior respective obligations or impair or prejudice their respective rights against the other.

Upon termination of this Agreement, for any reason whatsoever, the Dealer shall:

i. Immediately discontinue operation of the Authorised Outlet as a Brand Store or Concession Corner location, as the case may be, and the use of any Trademark and any Promotional Item indicative of the Distributor or any of its affiliates, and the use of the Know-How, except where the Know-How has become, by means other than breach by the Dealer of its confidentiality obligations, generally known or easily accessible. If the Dealer remains an authorised retailer of the Distributor, the Dealer may continue using the Trademarks and the Know-How, but only in connection with the resale of the Products and to the extent permitted by the Distributor.

ii. Notwithstanding the stipulations in Clause 10.6(i), immediately make such changes in the Furniture, Equipment, Other Distributor Supplied Items, the Promotional Items, and the interior and exterior of the Authorised Outlet as prescribed by the Distributor so as to effectively distinguish the business of the Dealer from its former public and marketing image as a Brand Store or Concession Corner location, as the case may be. If the Dealer, within 14 days of such direction, fails to make any such change, then the Distributor shall have the right to enter into the Premises and to make any such changes at the Dealer's expense.

iii. When requested by the Distributor but, in any case, within 1 (one) month from the date of termination of this Agreement, return to the Distributor, deal with or otherwise dispose of in accordance with the directions of the Distributor, all samples of the Products, any Promotional Items, operating manuals and any other items whatsoever bearing any of the Trademarks owned or lent by the Distributor, including the Furniture and Other Distributor Supplied Items then in the possession of the Dealer (“Distributor Property”), free of any charge.

iv. Acquire the Distributor Property, if the Distributor has elected by written notice to the Dealer to sell all or any of the Distributor Property to the Dealer, at a price equivalent to the Distributor’s net book value of the Distributor Property; namely, the cost to the Distributor of the Distributor Property less the depreciation of such cost over a period of 3 (three) years at such rate as the Distributor has applied.

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v. Forthwith pay to the Distributor (without any right of set-off) all outstanding unpaid invoices and any other sums of money that may be due from the Dealer to the Distributor pursuant to this Agreement within 14 days, including such claims which are considered as a result of such termination to be overdue. All Orders placed by the Dealer but not fulfilled by the Distributor at the date of termination of this Agreement shall be cancelled at the Distributor’s option.

The Distributor retains the right to repurchase all remaining Product stocks that are in merchantable condition held by the Dealer upon termination of this Agreement, in accordance with the conditions given below:

i. The Dealer shall be entitled to sell the Product stocks for a period of 3 (three) months commencing upon the date of termination of this Agreement. The Dealer shall only sell such Product stocks during the first 30 (thirty) day period upon termination of this Agreement at the Authorised Outlet with the Distributor’s prior written approval.

ii. The means by and locations at which the Dealer shall dispose of the Product stocks in the 3 (three) month period commencing upon the date of termination of this Agreement shall require the prior written approval of the Distributor, and such approval may be withheld or granted with or without conditions, at the Distributor’s absolute discretion.

iii. The Distributor shall be entitled to repurchase from the Dealer, all or part of the Product stocks in merchantable condition held by the Dealer, which the Dealer has not sold within the period of 3 (three) months from the date of termination of this Agreement, on or before the end of the 3 (three) month period following the termination of this Agreement.

iv. The price at which the Distributor shall be entitled to repurchase the Product stocks in good and merchantable condition from the Dealer, will be a sum equivalent to the depreciated value of the Product stocks according to their seasonality as calculated in accordance with the adidas Group’s Global Accounting Procedures (see Item 28 of Annex 4 and Annex 5) prevailing as at the date when the Distributor repurchases the Product stocks. The Distributor shall calculate the depreciated value of the Product stocks repurchased by multiplying the appropriate seasonality depreciation rate for the Product stocks by the price paid by the Dealer to the Distributor for each item of Product stock at the time of original purchase. The Distributor shall not compensate the Dealer for any items of Product stock which are soiled or not in merchantable condition.

v. The Distributor reserves the right to change its accounting procedures and depreciation rates from time to time from those given in Annex 5 and to notify the changes in writing to the Dealer within

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seven (7) days after the termination of this Agreement. Upon such written notice, the new rates of depreciation (if any) set out in such written notice shall apply to any Products stocks repurchased by the Distributor on termination of this Agreement.

vi. The Distributor shall arrange, at its own cost and expense, for the collection and transport of the Product stocks repurchased by the Distributor from the Dealer upon the termination of this Agreement.

In the event that the Distributor terminates this Agreement for any reason, the Dealer shall not be entitled to any compensation, howsoever described, from the Distributor in connection with the Dealer ceasing to be an authorised Dealer in the Territory for the Products, and the Dealer now irrevocably and unconditionally waives any and all rights which it might otherwise have to claim such compensation.

10.6 No Entitlement to Damages for Economic Loss

Neither Party shall, in connection with the termination of this Agreement in accordance with the terms hereof, have the right to claim any indemnity, reimbursement or compensation for alleged loss of clientele, goodwill, loss of profits or have any other liability for losses or damages resulting from the expiration or termination of this Agreement. Each Party acknowledges that it has decided and will decide on all investments, expenditures and commitments required or contemplated by this Agreement, in full awareness of the possibility of losses or damages resulting from the expiration and termination of this Agreement, and it is willing to bear the risk thereof.

Any losses which may be suffered by the Dealer as a result of its compliance with its obligations upon the termination of this Agreement shall be borne solely by the Dealer and the Dealer shall not be entitled to any compensation from the Distributor.

10.7 Waiver of Territory Laws

Each of the Parties waives its right to insist on compliance with the Territory Laws, if any, specified in Item 10 of Annex 1.

11. Confidentiality

Any information, which may be communicated to the Dealer or which it may acquire in connection with this Agreement or the operation of the Authorised Outlet shall be kept confidential ("Confidential Information") except where disclosure is required by law, in connection with the enforcement of this Agreement or where a specific item of information becomes public knowledge other than as a result of a breach of this Clause 11. The Dealer shall not, except for the sole purpose of operating the Authorised Outlet in accordance

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with the provisions of this Agreement, disclose or make available to any person any Confidential Information. The Dealer's failure to comply with its obligation to keep the Confidential Information confidential qualifies as a breach of this Agreement, for which the Distributor is entitled to seek an injunction, as well as claim damages and pursue any other legal remedies available to the Distributor.

Notwithstanding the termination of this Agreement for any reason whatsoever, the provisions of this Clause 11 shall continue to bind the Dealer after such termination. Specifically, the Dealer shall not divulge or reveal to any third party or the press any information relating to any dispute or disagreement rising from this Agreement or the operation of the Authorised Outlet or the use of the Trademarks, Promotional Items, Know-How or any other matter whatsoever between the Dealer and the Distributor, and the Dealer shall ensure that its employees, officers, consultants and agents to whom it is necessary to disclose the Confidential Information shall keep such Confidential Information strictly confidential.

12. Miscellaneous Provisions

12.1 Interpretation

This Agreement and the attached Annexures constitute the entire agreement and understanding of the Parties with respect to the subject matter of this Agreement, and supersede all previous oral or written discussions, understandings and agreements between the Parties with respect to the subject matter hereof. The Dealer acknowledges that it has not relied upon any oral or written representations made to it by the Distributor or by its employees or agents.

All documents, agreements, covenants or contracts executed by virtue of, or which make reference to, the terms of this Agreement, except those provisions contrary to any provision in this Agreement, shall immediately form part hereof as if set-out in full herein. In case of conflict between the provisions in this Agreement and those in any collateral agreement, the former shall prevail.

All expressions used in the Annexures to this Agreement shall, unless otherwise provided therein, have the same meanings as those given to them by this Agreement. All references to a natural person shall include such person's heirs, personal representatives, successors-in-title and permitted assigns. All references to a company shall include such company's successors-in-title and permitted assigns. All references to this Agreement shall be to this Agreement as modified from time to time by written agreement between the Parties. All references to provisions of statutes include such provisions as ameded, modified, re-certified or re-enacted from time to time. The singular shall include the plural and the plural shall include the singular.

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Any changes or additions/deletions made to this Agreement shall only be valid if made in writing and signed by or on behalf of both Parties.

In the event of any conflict between the provisions of this Agreement and the Franchise Commercial Terms and Conditions or the General Terms and Conditions of Trading, the relevant provisions of this Agreement shall prevail.

In computing time for the purposes of this Agreement, the period of days from the happening of an event or the doing of any act or thing shall be deemed to be exclusive of the day on which the event happens or the act or thing is done and, if the last day of the period is a weekly or public holiday, the period shall include the next following day which is not a weekly or public holiday.

Nothing in this Agreement shall be interpreted to allow or to require the Dealer to act contrary to the laws and regulations of the Territory including, without limitation, contrary to those specific law, if any, mentioned in Item 9 of Annex 1. All obligations imposed by this Agreement on the Dealer are subject to the condition that such obligations are not contrary to the laws and regulations of the Territory including, without limitation, those specific law, if any, mentioned in Item 9 of Annex 1, which laws shall take precedence over any obligation otherwise imposed on the Dealer by this Agreement.

12.2 Assignment by Dealer

The Dealer shall not assign or purport to assign any of its rights or obligations contained in this Agreement without the prior written consent of the Distributor, which consent may be withheld or granted, with or without conditions, by the Distributor in its absolute discretion.

For this purpose, the Dealer shall not change its existing proprietorship or allow withdrawal of any of its existing partners or allow any changes or transfers of its issued shares resulting in a change of existing shareholders without the prior written approval of the Distributor, and such approval shall not to be unreasonably withheld.

12.3 Force Majeure

Neither Party shall be liable for any loss suffered by the other Party arising out of delay in performance, or non-performance, of the Party's obligations due to any cause beyond the reasonable control of either Party.

Neither Party shall be liable for delay in performing its obligations or for failure to perform its obligations hereunder if the delay or failure resulted from circumstances beyond its reasonable control. Such circumstances shall include but shall not be limited to acts of God or government, war, fire, explosion, flood, accident, natural calamities or impossibility of obtaining services or materials (“Force Majeure”), provided that such Party shall have used all reasonable efforts in the circumstances to avoid or minimise the

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effects of any such delay or failure and to perform such obligations, notwithstanding the events which have occurred and such Party shall be granted an extension of time for the performance of such of its obligations as shall be so delayed for a period equal to the duration of such delay, provided such extension shall not be beyond three (3) months. If an event of Force Majeure continues for a period of three (3) months or more, either Party may terminate this Agreement by written notice to the other Party.

For avoidance of doubt, employee action (or the lack of it) by the employees of the Dealer shall not amount to an event of Force Majeure which may be relied upon by the Dealer.

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12.4 Copyright

The copyright and all other rights in any software, the Distributor’s intranet or website, any designs, photographs and all other documents which the Distributor may supply to the Dealer from time to time (“Copyright Material”), and all secret or confidential information contained therein belongs to the Distributor. The Dealer undertakes not to copy the Copyright Material or disclose the content or concept of the Copyright Material to any other persons or party and further undertakes not to make any direct or indirect use of the Copyright Material otherwise than for the operation of the Authorised Outlet in accordance with this Agreement.

For the purpose of this clause, “secret or confidential information” shall include all Confidential Information received by the Dealer from time to time from the Distributor, whether by a memorandum or electronic mail or transmission or other correspondence howsoever otherwise pertaining to the operation of the Authorised Outlet, save that which is generally known to the public domain other than through any breach by the Dealer of its confidentiality obligations to the Distributor.

12.5 Lease of Premises

The Dealer shall, as applicable:

i. Take a Lease in respect of the premises occupied by the Authorised Outlet (“Premises”) and obtain the written prior approval of the Distributor to the terms of the Lease before the Dealer contracts to be bound by the Lease.

ii. Observe and perform all agreements, obligations, covenants and stipulations contained or refereed to in the Lease, and enforce the agreements, obligations, covenants and stipulations on the part of the landlord contained or referred to in the Lease.

iii. Not vary or agree to vary the Lease, or surrender or agree to surrender the Lease without the prior consent in writing of the Distributor.

iv. Not assign or dispose of the Lease.

v. Ensure after the execution of the Lease that the Premises are altered, refurbished, equipped, fitted-out, designed, decorated and stocked in accordance with the requirements of this Agreement.

vi. Ensure that the Premises satisfy all planning, environmental, health and safety requirements.

12.6 Further Assurances

Each Party shall carry out this Agreement:

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i. In good faith.

ii. In co-operation with the other Party.

iii. With respect for the spirit as well as the letter of this Agreement.

iv. For the mutual benefit of both Parties.

Each Party shall, at its own expense, on the request of the other Party, do everything reasonably necessary to give effect to this Agreement and the transactions contemplated by it, including, but not limited to, the execution of documents.

12.7 No Deductions, Withholdings or Set-Off

All amounts payable to the Distributor under this Agreement shall be paid:

i. Free of any restriction or condition.

ii. Free and clear of and (except to the extent required by law) without any deduction or withholding on account of any tax.

iii. Without exercising any right of set-off whether contractual, statutory or implied by general law.

12.8 Other

Nothing in this Agreement or in any document referred to in it shall constitute any of the Parties a partner of the other, nor shall this Agreement be construed as a joint venture, collaboration or a franchise arrangement between the Parties, and the execution and implementation of this Agreement shall not confer on any Party any power to bind or impose any obligations to any third parties on the other Party or to pledge the credit of the other Party.

Each Party shall bear the costs and expenses incurred by it in connection with this Agreement.

The failure of either Party to exercise any right or remedy (including its right to terminate this Agreement) upon default by the other Party, or to insist on strict compliance with any obligation hereunder, shall not in any event be deemed a waiver of such default or of any subsequent default.

13. Representations, Warranties and Disclosure

Each Party warrants and represents to the other Party that its execution of this Agreement is duly authorised and that upon execution, the terms of this

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Agreement shall be binding and enforceable against it.

The Dealer acknowledges that it alone bears all risks of operating the Authorised Outlet.

Each Party acknowledges that it has taken full independent legal, financial and business commercial advice from its own consultants on this Agreement prior to its execution and confirms that, in making its assessment or decision to enter into this Agreement, it has not relied on any statement or representation of the other Party, its directors, employees, agents, representatives or any person whomsoever and howsoever connected with the other Party.

Each Party warrants that, on entering this Agreement and during the continuance thereof and at all times, it has made and shall continue to make full disclosure of all material facts, circumstances and other matters that would be likely to influence the decision of the other Party to enter into and/or to continue as a party to this Agreement.

The Dealer shall not make or give any representation or warranty to anyone in respect of the Products or in connection with the operation of the Authorised Outlet save for those representations and warranties, if any, which have been specifically authorised by the Distributor in writing, and the Dealer hereby undertakes to keep the Distributor fully and effectively indemnified against all claims, demands, losses, expenses and costs incurred by the Distributor as a result of any breach by the Dealer of this provision.

The Dealer shall indemnify the Distributor and keep the Distributor indemnified against all losses, damages, liabilities, claims or expenses incurred or suffered by the Distributor as a result of the Dealer’s conduct or operation of the Authorised Outlet, including but not limited to costs, claims, damages, losses, penalties, fines, liabilities and expenses of investigating and defending any claim, including legal fees and disbursements, and consultant’s fees and disbursements and in particular, those incurred as a result of:

i. The Dealer’s failure to comply with any applicable existing or future laws, regulations, registrations, codes of conduct, notices, permits, consents, approvals or licenses, including, without limitation, any such laws or regulations relating to protection of the environment, damage to or use of any property or harm to human health or the protection of public health and hygiene.

ii. The Dealer’s unauthorised use of the Trademarks.

iii. Any failure whether by the Dealer or its employees and agents to comply with this Agreement.

iv. Any deliberate or negligent act, omission or error by the Dealer or its

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employees or agents.

The Distributor shall indemnify the Dealer and keep the Dealer fully indemnified against any claims arising out of the sale or use of the Products.

14. Notice

All notices hereunder shall be in writing signed by the Party by whom it is served or by its outside legal counsel, and shall be sufficiently served for all purposes herein on the Party to whom it is addressed if it is delivered by hand or courier at or sent by pre-paid registered post or telefax (and confirmed forthwith, in the case of a notice sent by telefax, by the delivery by hand or courier or by ordinary or registered post of a copy of the notice) to such Party’s address set forth in this Agreement or to such address or telefax number as one Party may from time to time notify the other Party in writing.

To Distributor: As specified in Item 1 of Annex 1

To Dealer: As specified in Item 2 of Annex 1

Any notice sent by post shall be deemed to have been served 2 (two) business days after posting. In proving service, it shall be sufficient to prove that a notice was properly addressed and stamped and put into the post. Any notice sent by fax shall be deemed to have been served on the next business day following the date of despatch of it. Any notice delivered by hand shall be deemed to have been served when physically delivered at the relevant address.

15. Severability

In the event that a court or arbitral tribunal, of competent jurisdiction, determines, for any reason that the presence in this Agreement of any particular provision(s) makes the entry into this Agreement illegal or prohibited, the relevant provision(s) shall be deemed to have been deleted, in its entirely, from this Agreement prior to the execution of and/or entry into this Agreement.

If a court or arbitral tribunal, of competent jurisdiction, determines for any reason that any part of this Agreement is invalid, illegal or unenforceable (“Offending Part”), then:

i. Such determination shall not affect or impair the validity, legality or enforceability of the remaining parts of this Agreement except in the event that such determination materially and adversely changes the legal relationship of the Parties and/or the rights and obligations which the Parties owe to one another.

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ii. The Offending Part shall be deemed to be deleted from this Agreement.

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iii. The Parties shall negotiate in good faith a substitute part for the Offending Part (“Substitute Part”), which Substitute Part is valid, legal and enforceable and gives effect, as near as is reasonably possible, to the economic result intended by the Parties at the time this Agreement was entered into.

If, however, the Parties fail to reach agreement on the Substitute Part within 60 days, each Party shall have the right to terminate this Agreement on 30 days written notice to the other Party provided that the terminating Party would not have originally entered into this Agreement but for the presence of the Offending Part.

Any present or future legislation which operates to vary an obligation or right, power or remedy of a person in connection with this Agreement is excluded except to the extent that its exclusion is prohibited or rendered ineffective by law.

16. Survival

Notwithstanding any provision hereof, upon termination of this Agreement, Clauses 10.6, 10.7, 10.8, 11, 12.3, 12.4, 12.7, 14, 15, 16, 17 and 18 and the obligations thereunder shall not merge and shall survive termination of this Agreement.

17. Governing Law and Governing Language

This Agreement shall be governed by and construed in accordance with the laws of the jurisdiction specified in Item 8 of Annex 1.

This Agreement is made in the English language. In the event of translation of this Agreement into any other language, if there is a conflict between the English language version and the version in any such other language, the English language version shall prevail and supersede all discrepancies in language.

18. Settlement of Disputes

The Parties agree that, if any dispute arises out of or in connection with this Agreement, including without limitation any question regarding its existence, validity, termination of rights or obligations of any Party, or interpretation, the Parties shall attempt, for a period of 60 (sixty) days after the receipt by one Party of a notice from the other Party of the existence of the dispute, to settle such dispute in the first instance by mutual discussions between the Parties.

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Any dispute that cannot be settled amicably by mutual discussion within the 60 (sixty) day period referred to in the previous paragraph shall be finally settled by arbitration in accordance with the Rules of Conciliation and Arbitration (“Rules”) of the International Chamber of Commerce (“ICC”) then in force for arbitration. The number of arbitrators shall be three, who shall be nominated in the manner provided in the Rules.

The arbitration shall be conducted in Singapore under the auspices of the ICC. Any notice of arbitration, response or other communication given to or by a Party to the arbitration shall be given and deemed received as provided in the Rules. The arbitration shall be conducted in the English language. The costs of the arbitration shall be determined and paid by the Parties to the arbitration as provided in the Rules.

The Parties expressly agree:

i. There shall be no appeal to any court from the decision of the arbitrators.

ii. The mandate of the arbitrators duly constituted in this Agreement shall remain in effect until a final arbitration decision has been issued by the arbitrators.

No Party shall be entitled to commence or maintain any action in a court of law upon any matter which has been submitted to arbitration hereunder until such matter shall have been determined as provided in this Clause 18 and then only for the enforcement of the arbitration decision, provided that no provision hereof shall prevent a Party, in good faith, from seeking immediate equitable relief from a court of competent jurisdiction to enable the instituting Party to prevent the occurrence of irreparable harm (alleged to arise from the alleged breach) pending arbitral relief.

The decision of the arbitrators in any matter within this Clause 18 shall be final, binding and incontestable and may be used as a basis for judgment thereon in the Territory or elsewhere. It shall include a determination as to which of the Parties shall pay the costs and expenses of the arbitrators, the administrative costs of the arbitration, the legal fees incurred by the Parties, the cost and expenses of witnesses and all other costs and expenses necessarily incurred in the opinion of the arbitrators in order to properly settle the dispute.

Without limiting the application of law and regulations and without prejudice to a Party’s right to seek enforcement in any forum or jurisdiction, for the purpose of enforcing any decision of the arbitrators, the Parties hereby choose the domicile specified in Item 11 of Annex 1.

Subject to Clause 12.3, each Party shall continue to perform all its obligations under this Agreement notwithstanding the existence of a dispute and/or the

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reference of the dispute to arbitration pursuant to this Clause 18, and pending the decision of the arbitrators.

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IN WITNESS WHEREOF the Parties have executed this Agreement on the dates indicated below with effect from the date on which this Agreement was signed. The persons signing below for the Distributor and for the Dealer by his/her signature represents that he/she has read and fully understood this Agreement as well as all its annexures, has full authority to sign this Agreement and to bind the Distributor or the Dealer, as the case may be, and/or any other persons or entities whose authorisation may be needed to make this Agreement binding upon the Distributor or the Dealer, as the case may be, and to secure performance of the obligations contained herein, has given the necessary auhtorisation.

Signed this 1 day of December 2006

PT. adidas Indonesia CV. Virgo

By: By:

________________________ ________________________

Kannan Gopalakhrisnan Simon

President Director Owner

in the presence of:

Witness for the Distributor: Witness for the Dealer:

Signature: ________________________ Signature: _________________________

Name : ________________________ Name : _________________________

Title : ________________________ Title : _________________________

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