NOTE: Currently, PNX has 60% of the total fuel requirements of the client.

The
greatest share and volume comes from Batangas while the lowest is from Cebu.
Due to some logistics disadvantage in Calapan and Subic, we are not able to
achieve any penetration in the areas.

NOTE: Since Surigao and Calapan have the highest competitor share and effect
on PNX's share, we get additional volume in these areas. Furthermore, we can
also increase our share in Batangas, Bacolod, and Cebu since we have depots
there. We believe that a greater piece of the pie can be negotiated given that the
client wanted multiple suppliers for security purposes. The presence of a depot in
the area may relieve the security issue of the client.

NOTE: Calapan and Surigao are primary concerns for Phoenix since we currently
supply 0% of its monthly ADO consumption. Furthermore, we can also increase
supply in Batangas, Bacolod, and Cebu since we have a depot in these areas.
This will assure the client of the quality and security of the product ordered.

NOTE: In Batangas, Bacolod, and Cebu; we have our depots on those areas
which can assure on-time and quality supply of fuel to the client. Iloilo is only 45
kms from the Bacolod depot. Even though Dumaguete is 209 kms from Bacolod,
there is no problem on the side of the client. The only problem is in Calapan and
Suriagao where we have a logistics disadvantage.

NOTE: This is how much the client will pay to PNX; holding everything in constant
exept for the amount of volume increases in Bacolod, Batangas, Surigao, and
Calapan. However, the next table will show adjustments on prices due to internal
and external problems

There will be no price change in Batangas since we are priced competitively

against competitors and we have a depot there. It is important that we will monitor
and follow-up orders to maintain volumes.
To offset the logistics problem, we lower our prices. Furthermore, we offer pre- and
post-sales services from our technical team, monitor orders and follow-up the
client on real time information regarding logistics.
In Bacolod, our fuels are currently priced higher. However, we currently provide
60% of their total volume. This may either be because the client trusts us with our
depot installation in Bacolod or the client is not price sensitive. To what the case
may be, we match our competitor's prices in order to secure our volumes.
The same goes with Iloilo since the market is experiencing aggressive market
pricing; we match our competitor's prices.

NOTE: The following list of prices are the least that we can give. It is
recommended that we give prices greater than what is listed in order to yield
margins.

NOTE: The whole lubes account corresponds to a total sales potential of 4585000
pesos and a total sales margin potential for Phoenix of 458500 pesos.

NOTE: If we should have not made arrangements for consignment, the following
would have been our revenues and margins

NOTE: For Phoenix to secure a 2kl monthly volume of mixed grades of engine and
gear oils, the client requests that there will be a monthly delivery of 6kl per month
for emergency purposes. In this case, we need to understand that the
consignment arrangement will bring in implications to the profitability of the lubes.
NOTE 2: The following should be considered in arranging for the consignment
scheme: 1. Volume to deliver, 2. Volume that the client will use, 3. How long will
the client make us as their supplier, and 4. The cost of money
NOTE 3: The consignment scheme is assumed that the client will hold possession
of the 6kl lubes per month and consume the 2kl per month. The remaining lubes
will be on the possession of the client until the end of one year.
Even on a consignment basis, we can still achieve a margin of 46,550 pesos per
month.

However, there is a big chance that CnC will not go for a consignment. As an
alternative approach, we lower our margins to 8% of the total sales. In M-30 with
8% margin, we have the following total margins. The comparison shows that we
will have a lower margin compared to the consignment scheme. The M-30 scheme
however is recommended since it adhears to company policies and for security
purposes on the side of Phoenix.

We recommend that the client will acquire 95% of the Batangas volume, 60% of
the SUrigao volume, 80% of the Bacolod volume, 60% of Iloilo volume, 90% of
Cebu volume, 60% of Calapan volume, and 60% of Dumaguete volume. Such
supply will give our clients 133,750 pesos in savings.

In terms of lubes, we recommend that the client should get an M30 scheme with
lower quoted price. He will have savings of 10,150 pesos per month.