SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549
Form S-B2/A
Amended Form SB - 2REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
PARAGON POLARIS STRATAGIES.COM INC.
(Exact name of registrant as
specified in its charter)
Nevada 0273 76-0609444
(State or other jurisdiction of (Primary Standard Industrial (IRS Employer
incorporation or organization) Classification Code Identification No.)
Number)
404 Scott Point Drive, Salt Spring Island, BC V8K 2R2 Canada
(Address, including zip code, and telephone number,
including area code,
of registrant's principal executive offices)
Agent for Service: With a Copy to:
Robert Foo Arthur J. Frost
Paragon Polaris Stratagies.com Inc.. Arthur J. Frost Ltd.
404 Scott Point Drive 7549 West Heatherbrae Drive
Salt Spring Island, BC V8K 2R2 Canada Phoenix, AZ 85033
(250) 537-5732 (623) 849-2050
(Name, address, including zip code,
and telephone number,including area code,
of agent for service)
Approximate date of commencement of proposed sale
to the public:
Approximate date of commencement of proposed sale
to the public:As soon as practicable after the
effective date of this Registration Statement.
If any of the securities being registered on this
form are to be offered on a delayed or continuous basis
pursuant to Rule 415 under the Securities Act, check the
following box. [x]
If this Form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities
Act, check the following box and list the Securities Act
Registration Statement number of the earlier effective
Registration Statement for the same offering. [ ]
If this Form is a post-effective amendment filed
pursuant to Rule 462(c) under the Securities Act, check the
following box and list the Securities Act Registration
Statement number of the earlier effective Registration
Statement for the same offering. [ ]
If this Form is a post-effective amendment filed
pursuant to Rule 462(d) under the Securities Act, check the
following box and list the Securities Act Registration
Statement number of the earlier effective Registration
Statement for the same offering. [ ]
If delivery of the Prospectus is expected to be made
pursuant to Rule 434, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Amount Maximum Maximum Amount of
each To be Offering Aggregate Registration
Class of Registered Price Offering Fee
Securities per unit price
to be
registered
$
Common 1,000,000 $ .20 per 200,000.00 $ 56.00
stock shares share
No exchange or over-the-counter market exists for Paragon
Polaris Stratagies.com Inc. common stock. The average price
paid for Paragon Polaris Stratagies.com Inc. common stock
was $.0004 per share.
The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its
effective date until the registrant shall file a further
amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance
with section 8(a) of the Securities Act of 1933 or until the
Registration Statement shall become effective on such date
as the Securities and Exchange Commission, acting pursuant
to such section 8(a), may determine.
We will amend and complete the information in this
Prospectus. Although we are permitted by US federal
securities law to offer these securities using this
Prospectus, we may not sell them or accept your offer to buy
them until the documentation filed with the SEC relating to
these securities has been declared effective by the SEC.
This Prospectus is not an offer to sell these securities or
our solicitation of your offer to buy these securities in
any jurisdiction where that would not be permitted or legal.
SUBJECT TO COMPLETION
Prospectus
June 27, 2000
PARAGON POLARIS STRATAGIES.COM INC.
404 Scott Point Drive
Salt Spring Island, BC V8K 2R2 Canada
1,000,000 Shares of Common Stock
to be sold by the registrant as issuer.
This is the initial public offering of common stock of
Paragon Polaris Stratagies.com Inc. and no public market
currently exists for these shares. Paragon Polaris
Stratagies.com Inc. is offering for sale up to one million
shares of its common stock on a "self-underwritten" best
efforts basis at a price of $0.20 per share for a period of
one hundred and eighty days (six months) following the
acceptance of the Registration Statement, of which this
Prospectus forms a part.
No commissions will be paid for the sale of the 1,000,000
shares offered by Paragon Polaris Stratagies.com Inc. unless
a broker/dealer agrees to market them for us. In that case,
commissions will be negotiated and a post-effective
amendment will be filed with the SEC revealing the terms and
conditions of the commissions and expenses charged. The
most recent sale of Paragon Polaris common stock was in June
2000 at a price of $0.20 per share.
This investment involves a high degree of risk. See "risk
factors" beginning on page 1.
Neither the SEC nor any state securities commission has
approved or disapproved of these securities or passed upon
the adequacy or accuracy of this Prospectus. The SEC has not
made any recommendations that you buy or not buy the shares.
Any representation to the contrary is a criminal offense.
PART I - SUMMARY INFORMATION AND RISK FACTORS.
Prospectus Summary
Paragon Polaris Stratagies.com Inc. (Paragon Polaris) is a
corporation formed under the laws of the State of Nevada whose
principal executive offices are located on Salt Spring Island,
British Columbia, Canada.
The primary objective of the business is designed to market high-
quality, low-cost vitamins, minerals, nutritional supplements,
and other health and fitness products to medical professionals,
alternative health professionals, martial arts studios and
instructors, sports and fitness trainers, other health and
fitness professionals, school and other fund raising programs and
other similar types of customers via the Internet for sale to
their clients.
Name, Address, and Telephone Number of Registrant
Paragon Polaris Stratagies.com Inc.
404 Scott Point Drive
Salt Spring Island, BC V8K 2R2, CANADA
(250) 537-5732
The Offering
- Price per share offered $0.20
- Common Stock offered by the company 1,000,000
shares
- Common stock to be outstanding after the offering
3,500,000 shares
(assuming all shares are sold)
- use of proceeds - to fund marketing and setting up of
dealers to handle line of vitamins and mineral supplements.
Risk Factors
An investment in the shares of Paragon Polaris involves a high
degree of risk. You should carefully read all of the following
Risk Factors as well as the rest of this Registration Statement.
Management of Paragon Polaris believes that the following Risk
Factors describe all of the material risks of which it is aware.
Risk factors affecting operating results
We have had losses since inception and expect such losses to
continue for the foreseeable future.
Paragon Polaris has never had any revenues. Costs are incurred
to set up the business plan and to get into business. While the
licensor, Vitamineralherb.com ('Vita") has set up the master web
page and organized the processing of purchases, we must provide
our own accounting systems and sales planning including finding
and hiring good, reliable sales people. These efforts will use
our cash reserves. We will not have any substantial cash
reserves until this Offering is complete. If this Offering is
not completed, we will not be able to get into business. This
could have a serious affect on the price of our stock.
Once we get into business and sales begin, we still expect to
lose money for a considerable period. We will record losses
until our profits from sales exceed our expenses. If we do not
accomplish this, any and all funds that we have in reserve will
be used up. You should consider these facts carefully before you
invest.
We do not expect to have any revenues from sales of health
products until some indefinite time in the future.
A great many things must happen before we receive any revenues,
at all. They are:
- this Registration Statement and Prospectus must be accepted
by the Securities and Exchange Commission;
- this Offering must be successfully completed and the funds
received;
- competent administrative people must be hired;
- a minimum of two experienced sales people must be obtained.
After the proper people are hired, it will still take time to
acquaint them with the business plan, the product and the
territory. We cannot expect to generate any kind of sales
activity or revenues until all of the above items have come to
pass. This time lag will have a negative affect on the price of
the stock, if a market ever develops.
Costs of getting new customers for our health products and
keeping them are unknown.
Paragon Polaris does not have any experience as to the costs of
setting up a new customer and keeping that customer. We do not
know for sure how acceptable our business is to potential
clients. If repeated calls are made to obtain the first order
and further orders, frequent service calls are necessary to keep
that customer happy. The costs involved could well be greater
than the gross profit on any sale made to that customer. If
this should to be the case, we would lose money on each customer
and the whole business plan would prove to be unworkable.
Our business is sensitive to changes in the prices of Vita and
its competitors.
We have no control over the prices we pay for the products we
sell. Vitamineralherb.com Corp. sets the wholesale and the
retail price of all the products they supply. Vita, in turn, is
subject to pricing pressures put on by their competition. If,
for any reason, Vita's competitors decide to lower their prices,
even below their costs, Vita and Paragon Polaris would be forced
to follow. The result? We would lose money until the situation
changed. This should be considered by all prospective investors.
Paragon Polaris will compete with other Internet retailers and
may not achieve the customer base necessary to become or remain
profitable
Our future revenues and profits, if any, depend upon the
widespread acceptance and use of the Internet as an effective
medium of business by target consumers. Consumers may not choose
to do business over the Internet in sufficient number to
establish the customer base necessary to obtain revenues and
achieve profitable operations. Even if use of the Internet and
electronic commerce continues to increase, the online vitamins
market may not develop. Paragon Polaris may therefore be unable
to successfully market and sell its product, in which case it
would not become profitable.
Failure of the licensor to supply one or more services will
hamper our ability to do business.
As part of its license, Paragon Polaris's licensor has agreed to
provide and maintain;
(1) a website through which orders are placed and
(2) a payment system for receipt of payments from customers and
disbursement of funds
to Paragon Polaris and its supplier.
If the licensor fails to provide these services, Paragon Polaris
may be unable to conduct its business. If we are unable to
conduct business, we may lose customers and revenues. The future
success of Paragon Polaris will depend, in part, on the
licensor's use of leading technologies to provide seamless access
to and services through its website. Computer viruses or
problems caused by third parties could lead to interruptions,
delays or cessation in service to Paragon Polaris If the licensor
does not maintain an up-to-date effective website our online
sales may not be effective.
We are dependent on a variety of service providers that may or
may not deliver adequate service.
Paragon Polaris is dependent on other service providers with the
exception of direct sales to customers. We will have no control
over the business practices and equipment of these providers. We
are forced to rely on their word that their systems are protected
against damage from fire, earthquakes, power loss, system
failures or similar events. In addition, failure of
telecommunications systems, for any reason, could cause
interruptions in the services we offer.
Paragon Polaris will base expenses on what we think sales will be
in the future.
We have no basis for making predictions as to what sales volume
we can achieve and how long it will take. Like any new, untried
and unproven business, management will try to estimate sales
volume and on that estimate will budget for expenses. If they
are wrong estimates or guesses, it is probable that expenses
could be much higher and sales much lower, or both. If this
proves to be the case, it is bound to result in losses. This set
of events could have a very negative affect on your investment in
this company.
We may experience a large turnover in personnel before getting
reliable employees.
Hiring reliable and competent staff is always a problem, even for
established companies. For a company like Paragon Polaris Inc.
which is entering entirely new and unproven business areas, it is
even more of a problem. It is especially difficult to prejudge
the degree of success of sales people. This is likely to result
in the hiring and training of new employees continuously, large
expenses with little or no sales. Again, a negative affect on the
possible profitability and on the value of the stock.
We may be unable to adjust to changes in consumer preferences.
Consumers of vitamin, mineral and herbal supplements have
changing requirements which we will have to adjust to. Not only
are they looking for new and different products but they are
looking for new and better ways to take standard products. In
order to be successful, we will need to react to these changes
quickly. We are completely dependent upon Vita to respond to
these changes in the market. We cannot be sure that Vita has the
ability to respond quickly to adjust their products to the
changing tastes. Failure to do so could mean that our sales
could lag, our profits, if any, could go down and stock prices be
forced down.
We do not have the ability to react to technology changes of the
Internet.
Internet access and E-commerce are affected by rapidly changing
technology, new industry standards, changes in customer needs and
frequent introduction of new services. Part of our success or
failure will depend on being able to effectively use leading
technologies; to continue to handle new technical developments
and to keep our existing services up to date and develop new
services to meet changing customer needs quickly and at the same
time keep our costs in line.
We are totally dependent on Vita to react quickly to these
changes. They are completely in charge of the Internet aspect of
our business. They may feel that they do not have to change and
that could have a negative affect on our business or if they are
willing to change, their decision to do so could take a long time
and again, the results would seriously affect the success or
failure of our business. You would be wise to consider these
facts when thinking about investing.
Growth strategy and potential acquisitions.
You cannot be sure that Paragon Polaris will be successful in
implementing its growth strategy. Failure could result in
serious losses and if severe enough could result in the failure
of our business.
Sales development will depend on our retail distributors
accepting our business concept and their efforts in selling our
products to the consumer. The growth rate of sales will depend
on the quality of our sales people.
Another part of our growth strategy; the strategic acquisition of
similar businesses, involves certain risks, including, among
others:
- the difficulty in assimilating operations and personnel;
- the potential disruption of ongoing business at the time of
acquisition;
- the possible inability of management to take advantage of
the combined operations; after acquisition;
- the risks of entering markets in which we have little or no
prior experience;
- and potential bad effects to relationships with employees
and customers as a result of changes in management.
In addition, any such transaction could have a negative affect on
our operating results due to dilution. This dilution of present
stockholder value could come from the issuance of common stock,
increasing the debt and the costs of goodwill and other
intangible assets, if any.
Competition.
The market for Internet access to individuals is extremely
competitive. Almost anyone can start an Internet business. Most
startups are doomed to failure. We believe that the main things
that determine success in this market are a reputation for
reliability and service, effective customer support, pricing,
creative marketing, easy-to-use software and geographic coverage.
We think we have all of those things but until the business is
operating you cannot rely on our being successful. This fact
needs to be considered before you invest.
Other important factors include the timing of new products and
the economy. We do not know that Paragon Polaris will be able to
compete successfully against current or future competitors. We
also do not know if that competition will not have a bad effect
on our business, financial condition and possibility of profit.
Competitors could include many larger companies that may have
much greater market presence and financial, technical, marketing
and other resources than Paragon Polaris
Paragon Polaris will soon need full-time management and added
personnel which may be difficult to find.
The future success of Paragon Polaris depends upon the efforts of
Robert Foo and Samuel Lau its current officers and directors.
They now serve on an "as needed" basis. Upon the completion of
part or all of this offering, one or more of the officers will
be needed full-time. We cannot be sure that any of the officers
and directors will act in a full-time capacity.
We have no employment contracts with either officer or director.
Both have other business interests and occupations and we cannot
be sure that one or all would be available on a full-time basis.
If these key people are not available when they are needed it
could delay getting into business and cause a severe drain on our
available cash. You should be aware that this would affect the
price of the common stock, if and when a market is established
for the shares.
Other senior management and technical, marketing and sales
personnel will be needed. Our success also depends on our
ability to attract and keep this highly qualified management,
technical, marketing and sales personnel. If we cannot attract
qualified personnel it would affect the business, financial
condition and profits, if any.
Security Risks
The Vitamineralherb.com. Internet website may be vulnerable to
computer viruses. Other problems could be caused by customers,
connected Internet sites, the interconnecting networks and the
various telephone networks. Computer viruses or problems caused
by third parties could lead to interruptions, delays or halting
of service to Paragon Polaris, our dealers and customers.
It is our intention and the intention of Vita to install and
maintain security measures to prevent any of the problems
mentioned above but you should realize that such measures have
been circumvented in the past. Neither you nor we can be sure
that measures taken by both companies will not be circumvented in
the future.
The future market for our health products New and Uncertain
Market New and Uncertain Market is unsure.
Internet - accessible vitamin, health, and nutritional products
and related services is a fairly new market. The success of
Paragon Polaris will depend upon the continuing development and
expansion of the Internet. We also are counting on the desire on
the part of the public for Internet goods and services. If
growing demand for Internet goods and services fails to continue
or growth slows or becomes saturated with competitors, our volume
of business, operating results and financial condition may be
badly affected. If, on the other hand, the Internet continues to
experience rapid growth in number of users and level of use, we
cannot be sure that the Internet will be able to handle such
growth.
You should be aware of potential product and sales practices
liability.
Paragon Polaris has no control over its customers' use of health
and vitamin supplements after the sale. In addition, we have
little control over the online practices and the information
passed through or stored on our systems by its customers or
members.
The law relating to the liability of Internet access providers
and online service companies for incorrect use of the Internet
and information carried on or spread through their networks is
unsettled. Although we do not plan to actively monitor the
content of our customers' Internet transmissions, someone may
claim that we had knowledge of such content. It is possible
that, if Paragon Polaris were to be prosecuted that any defenses
to liability would not be applicable.
We may be subject to future government regulations on the sale of
our products.
Internet-related regulatory policies are continuing to develop,
and it is possible that Paragon Polaris could be exposed to new
regulations in the future. Due to the increasing popularity and
use of the Internet, it is possible that additional federal,
state or other laws and regulations may be adopted. These could
cover issues such as content, privacy, encryption standards,
consumer protection, electronic commerce, taxation, copyright
infringement and other issues.
We will definitely need additional capital.
Paragon Polaris does not have sufficient capital to properly get
into business, to respond to new technical developments or
competition or to take advantage of unexpected opportunities.
Such items as special marketing programs, the development of new
services or opportunities to acquire complimentary businesses
require capital. Our success, if any, of establishing the
business, creation of sales and follow-up service depends upon
new capital through this Offering.
No other source of capital has been approached and if this
Offering is not at least partially successful, we do not have
other sources. If other sources are available we have no idea
whether capital can be obtained on terms and conditions that are
acceptable. Further, any such financing may be upon terms that
result in dilution or considerable lessening of value of the
shares currently held by Paragon Polaris shareholders.
Risks Related to the Securities Market
Paragon Polaris common stock has no prior market, and prices may
decline after the effectiveness of this Prospectus and subsequent
resale of shares by selling shareholders.
There is no public market for the common stock of Paragon Polaris
and you should not rely on the possibility that a market will
develop or that any shareholder will be able to sell his shares
without considerable delay, if at all.
If there is a market, the price you may receive for the common
stock may be lower than the purchase price. If a market should
develop, the price may be highly volatile. In addition, an
active public market may not develop or be sustained. If Paragon
Polaris and selling stockholders sell substantial amounts of
common stock through this Offering or in a public market should
one develop, the market price of its common stock could fall.
Any or all of these factors will have an affect on the price you
would receive if you decided to sell all or part of your stock,
should you decide to invest.
Many brokerage firms may not be willing to handle transactions in
our securities. Even if a buyer finds a broker willing to buy or
sell the stock of Paragon Polaris, the combination of brokerage
commissions, state transfer taxes, if any, and other selling
costs may be larger than the selling price.
Many lending institutions will not permit the use of such
securities as collateral for loans. Thus, you may be unable to
sell or recover your investment in Paragon Polaris stock.
The securities of Paragon Polaris, when and if they become
available for trading, will be subject to the Securities and
Exchange Commission rule that imposes special sales practice
requirements upon broker-dealers that sell such securities to
other than established customers or accredited investors. For
purposes of the rule, the phrase "accredited investors" means, in
general
terms:
a) institutions with assets exceeding $5,000,000
b) individuals having a net worth in excess of $1,000,000
or having an annual income that exceeds $200,000 (or
that, combined with a spouse's income, exceeds
$300,000).
For transactions covered by the rule, the broker-dealer must make
a special suitability determination for the purchaser and receive
the purchaser's written agreement to the transaction prior to the
sale. Consequently, the rule may affect the ability of
purchasers of Paragon Polaris securities to buy or sell in any
market that may develop.
Investors may face significant restrictions on the resale of
Paragon Polaris stock due to state and federal laws and
regulations.
Because the securities of Paragon Polaris have not been
registered for resale under the blue sky laws of any state, the
holders of such shares and those persons desiring to purchase
them in any trading market that may develop in the future should
be aware that there may be significant state blue sky law
restrictions on the ability of investors to sell and on
purchasers to buy its securities. Accordingly, investors should
consider the secondary market for Paragon Polaris securities to
be a limited one. You may be unable to sell your stock without
the significant expense of state registration or qualification.
In addition, the Securities and Exchange Commission has adopted a
number of rules to regulate "penny stocks". Because our
securities may constitute a penny stock within the meaning of the
rules, the rules would apply to Paragon Polaris and its
securities. The rules may further affect your ability to sell
your shares in any market that may develop.
Shareholders should be aware that, according to the Securities
and Exchange Commission Release No. 34-29093, the market for
penny stocks has suffered in recent years from patterns of fraud
and abuse.
Summary of risks relating to penny stocks.
1) Paragon Polaris stock is a penny stock.
2) Some states will not allow you to sell to their citizens.
3) Some broker/dealers will not handle transactions in penny
stocks.
4) SEC rules make selling your stock a cumbersome procedure.
5) Penny stock markets can be very volatile with large
swings up or down.
Management of Paragon Polaris believes it has described above all
material risks known to it at this time.
Use of Proceeds
Legal Fees $20,000.00
Accounting 10,000.00
Electronic filing and printing 5,000.00
Start up costs (office equipment, telephone
system, computers and software) 70,000.00
Working Capital 95,000.00*
Total 200,000.00
* Assumes offering is fully subscribed to. Working capital
figure will be adjusted downward in the event all or any part of
the offering is sold through a Broker/Dealer or total offering is
not subscribed to.
We have estimated that we will have approximately $95,000 working
capital if this offering is fully subscribed to. This money will
be used for hiring sales people, office staff and paying the
expenses of getting the business started. This money may or may
not be enough to run the business until sales revenues can take
over. If it is not enough we will be forced to look for more
funding. No arrangements have been made for this funding.
Determination of Offering Price
The offering price of this issue was set in a purely arbitrary
manner. We determined the amount of money needed to start the
business; added a contingency amount; allowed for printing, legal
and accounting costs and possible commissions if a Broker/Dealer
should become involved with the sale to the public of this issue.
We also took into account the resultant number of shares in the
"float", i.e. the number of shares available to be traded. The
final consideration was the perceived market capitalization (the
theoretical total worth of the shares of Paragon Polaris if they
were all sold at a specific price at the same time).
Dilution
Paragon Polaris, prior to this offering has 2,500,000 shares of
stock issued and outstanding. The following table will show the
net tangible value of the shares before and after shares are
subscribed to in this offering.
Before After 50% After 100%
Offering of offering of offering
- Net tangible book value .0011 .0342 .0579
- Increase in net NA .0331 .0568
tangible book value
- Dilution factor NA .1658 (82.90%) .1621 (81.10%)
The above table indicates that the net tangible book value of
Paragon Polaris before the offering is slightly more than 1/10 of
one cent. If half of this offering is subscribed to, you would
lose 16.58 cents value of the 20 cents you paid or 82.90 %. If
all of the offering were completed you would still lose 16.21
cents of the 20 cents you invested or 81.10%.
The price paid by officers, directors and affiliates was $.001 or
one mill per share. Compare this price with the $.20 you will
pay. These are facts that should be carefully considered.
Determination of offering price
If you are thinking about investing, you should be aware that the
price of the shares of Paragon Polaris might not bear any direct
relationship to net tangible book value per share. The price
received by selling stockholders and paid by purchasing investors
will be determined by supply and demand. If the demand for the
common stock exceeds the available supply, the price will tend to
go up; if the supply exceeds the demand, the price will tend to
go down. In both of the above cases the change in price may
have no relation to the book value of Paragon Polaris whether it
is profitable or not.
Selling security holders
There are no selling shareholders.
Plan of Distribution
This is a self - underwritten Offering. This Prospectus is part
of a Registration Statement that permits the Officers and
Directors of Paragon Polaris to sell directly to the public, with
no commission or other remuneration payable. At the discretion
of our Board of Directors, an underwriting contract may be
entered into with one or more Broker/Dealers on a "best efforts"
or firm basis. In this case, commissions and expenses within the
guidelines of the NASD would be negotiated. We will be required
to halt sales and file a post-effective amendment to this
Prospectus outlining the payment to the broker/dealer(s).
Legal Proceedings.
We are not aware of any legal proceedings that have been or are
currently being undertaken for or against Paragon Polaris nor is
any contemplated
Directors, executive officers, promoters and control persons.
The directors and executive officers currently serving Paragon
Polaris are as follows:
Name Age Positions Held and Tenure
Robert Foo 49 President and Director since
December, 1999
Samuel Lau 32 Secretary/Treasurer and
Director since December,
1999
The directors named above will serve until the first annual
meeting of the stockholders of Paragon Polaris stockholders.
Thereafter, directors will be elected for one-year terms at the
annual stockholders' meeting. Officers will hold their
positions at the pleasure of the board of directors, absent any
employment agreement, of which none currently exists or is
contemplated. There is no arrangement or understanding between
the directors and officers and any other person pursuant to
which any director or officer was to be selected as a Director
or Officer.
Biographical information
Robert Foo. Robert Foo, a native of Malaysia and a Canadian
Citizen, is the President and a Director of Paragon Polaris. In
1975 he graduated from Southern Alberta Institute of Technology
with a degree in Business Administration. From 1975 to 1977 Mr.
Foo was in the management program of the Denny=s Restaurant
chain. From 1977 through 1980 he was a sale agent for The
Metropolitan Life Insurance Company. From 1980 to 1986 he was a
sales representative of Seaboard Life Insurance. Mr. Foo served
as the promoter of Archer Communications, Inc. from 1986 to 1988
and currently is President and Chief Executive Officer of Trans
Asia Resources, Inc., an oil and gas exploration company,
currently engaged in drilling in Texas in conjunction with NYSE
listed Apache Petroleum, Inc.
Samuel Lau. Mr. Lau is the Secretary Treasurer and a Director of
Paragon Polaris.
Since July, 1998 he has served the corporate secretary and office
manage of Trans Asia Resources, Inc. an oil and gas
exploration company. For the two years preceding June, 1998, Mr.
Lau was a supervisor at a large Travel Agency, Happy Times
Travel. From September, 1996 to May, 1998 he was a travel
consultant with Quality Travel. From 1991 through 1993 he was a
sales representative for Key Jewelry. Mr. Lau attended York
University, Toronto Ontario.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth, as of the date of this
Registration Statement, the number of shares of Common Stock
owned of record and beneficially by executive officers, directors
and persons who hold 5.0% or more of the outstanding Common Stock
of Paragon Polaris. Also included are the shares held by all
executive officers and directors as a group.
Number of Percent of
Shares Owned
Name and Address Beneficially Class Owned
Robert Foo 250,000 10
4138 Staulo Crescent
Vancouver, BC V8N 3S2
Samuel Lau 250,000 10
Marie M. Charles 200,000 8
Roy Donovan Hinton Jr. 200,000 8
Darren Quan 200,000 8
George R. Quan 200,000 8
Marsha Quan 200,000 8
All directors and executive
Officers as a group (2 persons) 500,000 20 %
The persons listed are the sole officers and directors of Paragon
Polaris
Conflicts of Interest
The officers and directors will only devote a portion of their
time to the affairs of Paragon Polaris. There will be occasions
when the time requirements of the business conflict with the
demands of their other business and investment activities. We
may need to employ additional personnel. If this happens, we
cannot be sure that good people will be available and if they are
available, we can get them at a price we can afford.
There is no procedure in place, which would allow either Mr. Foo
or Mr. Lau to resolve potential conflicts in an arms-length
fashion. We must rely on them to use their discretion to resolve
these conflicts.
Description of securities
Common Stock.
The Articles of Incorporation of Paragon Polaris authorize the
issuance of 25,000,000 shares of Common Stock. Each holder of
record of Common Stock is entitled to 1 vote for each share held
on all matters properly submitted to the stockholders for their
vote. The Articles of Incorporation do not permit cumulative
voting for the election of directors.
Holders of Common Stock are entitled to such dividends as may be
declared from time to time by the Board of Directors out of
legally available funds. In the event of liquidation,
dissolution or winding up of the affairs of the Paragon Polaris,
holders are entitled to receive, ratably, the net assets
available to stockholders after distribution is made to the
preferred shareholders, if any.
Holders of Common Stock have no preemptive, conversion or
redemptive rights. All of the issued and outstanding shares of
Common Stock are, and all unissued shares when issued will be
duly authorized, validly issued, fully paid, and non assessable.
If additional shares of Paragon Polaris Common Stock are issued,
the relative interests of then existing stockholders may be
diluted.
Transfer Agent
Paragon Polaris is currently serving as its own transfer agent,
and plans to continue to serve in that capacity until such time
as management believes it is necessary or appropriate to employ
an independent transfer agent in order to facilitate the creation
of a public trading market for its securities. Should Paragon
Polaris securities be quoted on any exchange or OTC quotation
system or application is made to have the securities quoted, an
independent transfer agent will be appointed.
Indemnification of Officers and Directors
As permitted by Nevada law, Paragon Polaris's Articles of
Incorporation provide that Paragon Polaris will indemnify its
directors and officers against expenses and liabilities they
incur to defend, settle or satisfy any civil or criminal action
brought against them on account of their being or having been
Company directors or officers, unless, in any such action, they
are adjudged to have acted with gross negligence or willful
misconduct.
Exclusion of Liabilities
Pursuant to the laws of the State of Nevada, Paragon Polaris's
Articles of Incorporation exclude personal liability for its
directors for monetary damages based upon any violation of their
fiduciary duties as directors, except as to liability for any
breach of the duty of loyalty, acts or omissions not in good
faith or which involve intentional misconduct or a knowing
violation of law, acts in violation of Section 7-106-401 of the
Nevada Business Corporation Act, or any transaction from which a
director receives an improper personal benefit. This exclusion
of liability does not limit any right, which a director may have
to be indemnified, and does not affect any director's liability
under federal or applicable state securities laws.
Disclosure of commission position on indemnification for
Securities Act liabilities
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or
persons controlling Paragon Polaris pursuant to provisions of the
State of Nevada, Paragon Polaris has been informed that, in the
opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in that Act
and is, therefore, unenforceable.
Organization within the last five years
Paragon Polaris was incorporated in the State of Nevada on May
27, 1999 and is in the early stages of development. From
inception the only activities of Paragon Polaris have been the
development of its business plan and the preparation for this
Registration Statement. It has no revenues nor does it have any
expectation of revenues until the completion of this Offering and
the commencement of business.
Description of business
On July 1, 1999 Paragon Polaris received from David R. Mortenson
& Associates of Alvin, Texas, the rights to distribute and
produce, in the state of Pennsylvania, an oxygen enriched water
product for fish farming, aquaculture, mariculture, poultry
raising, and for treating animal waste from dairies, feedlots of
all kinds, and for other similar uses. These production and
distribution rights were received from Mortenson in exchange for
2000,000 shares of common stock. Mortenson acquired these rights
from the inventors of the product, N. W. Technologies, Inc. under
a distribution agreement. Several months later the contract
granting David R. Mortenson & Associates rights to the technology
was withdrawn. Mortenson sued NW Technologies Inc. in Harris
County Court, Houston Texas.
To compensate for the possibility that we could lose our
principal asset and the obvious delay that this dispute and court
action has caused, David R. Mortenson & Associates has agreed to
suspend all financial requirements that are due or will be due in
the future until the dispute with NW is resolved. They have also
agreed to grant an alternative license to Paragon Polaris for the
distribution of vitamin and herbal supplements for the states of
Idaho and Oregon. This license will enable us to create a
business plan and start the process of getting into business.
The License.
Paragon Polaris has a three year license to market and sell
vitamins, minerals, nutritional supplements, and other health and
fitness products to medical professionals, alternative health
professionals, martial arts studios and instructors, sports and
fitness trainers, other health and fitness professionals, school
and other fund raising programs and other similar types of
customers. All of these individuals and organizations will
order their products directly from Vitamineralherb.com via the
Internet for sale to their clients. The license will be
automatically renewed unless Paragon Polaris or
Vitamineralherb.com gives the other notice of its intent not to
renew.
As a licensee of Vitamineralherb.com, Paragon Polaris eliminates
the need to develop products, store inventory, build and maintain
a website, establish credit card processing and develop a
fulfillment system. This enables us to focus strictly on
marketing and sales. Paragon Polaris plans to target health and
fitness professionals in Idaho and Oregon who wish to offer
health and fitness products to their customers.
Paragon Polaris and its customers will have access to all
products offered on the Vitamineralherb.com website, as well as
the ability to order custom-formulated and custom-labeled
products. Vitamineralherb.com sets the price for products based
on the manufacturer's price, plus a markup that provides a 10%
commission to Vitamineralherb.com and a profit for Paragon
Polaris.
Three different labeling options are available to customers:
- products may be ordered with the manufacturer's standard
label with no customization.
- the fitness or health professional may customize the labels
by adding its name, address, and phone number to the standard
label. In most cases, these labels would be a standardized label
with product information and a place on the label for the wording
"Distributed by". This gives the health and fitness professionals
a competitive edge.
- labels may be completely customized for the health or
fitness professional.
When a fitness or health professional becomes a client, the
Paragon Polaris salesperson will show the client how to access
the Vitamineralherb.com website. The client is assigned an
identification number that identifies it by territory,
salesperson, and business name, address, and other pertinent
information. The health or fitness professional may then order
the products it desires directly through the Vitamineralherb.com
website, paying for the purchase with a credit card, electronic
check ("e-check"), or debit card. All products are shipped by the
manufacturer directly to the professional or its clients.
Paragon Polaris is not obliged to purchase and maintain a large
inventory, an order desk or shipping department. This method of
doing business, which only a short time ago would be unthinkable
is now a preferred way of shopping (whether wholesale or retail)
for a large segment of the population of North America.
The website is maintained by Vitamineralherb.com and each
licensee pays an annual website maintenance fee of $500. All
financial transactions are handled by Vita's Internet clearing
bank. The Vitamineralherb.com webmaster downloads e-mail orders
several times a day, checks with the clearing bank for payment
and then submits the product order and electronic payment to
International Formulation and Manufacturing. Vitamineralherb.com
then forwards the money due Paragon Polaris via electronic funds
transfer.
Vitamineralherb.com software tracks all sales through the
customer's identification number, and at month end, e-mails to
Paragon Polaris a detailed report including sales commissions.
Vitamineralherb.com has indicated that it will use e-commerce
advertising such as banner ads on major servers and web sites, as
well as attempting to insure that all major search engines pick
Vitamineralherb.com first. All sales originating from the website
to customers located in Idaho and Oregon will automatically be
assigned to Paragon Polaris
Background on the Manufacturer and Distributor
On June 9, 1999, Vitamineralherb.com entered into a manufacturing
agreement with International Formulation and Manufacturing Inc.,
a nutraceuticals manufacturing firm, located in San Diego,
California. International Formulation and Manufacturing has been
a contract manufacturer of vitamin, mineral, nutritional
supplement, and alternative health products for various marketing
organizations for approximately six years. International
Formulation and Manufacturing does no retail marketing.
In addition to a line of standard products, International
Formulation and Manufacturing is able to manufacture custom
blended products for customers. They also have the capability to
supply privately labeled products for Paragon Polaris customers
at a minimal added cost. Vitamineralherb.com has just begun
developing its vitamin marketing and distributorship business.
Implementation of the business plan.
Paragon Polaris business plan is to determine the feasibility of
selling Vitamineralherb.com products to targeted markets. We
may, during the next six to twelve months, conduct research into
the various potential target markets. Should we determine that
our business plan is feasible, we intend to employ salespeople to
call on medical professionals, alternative health professionals,
martial arts studios and instructors, sports and fitness
trainers, other health and fitness professionals, school and
other fund raising programs and other similar types of customers.
Our object is to interest these professionals in selling their
clients high-quality, low-cost vitamins, minerals, nutritional
supplements, and other health and fitness products. These
professionals would sell the products to their clients and order
them through the Internet.
If the net proceeds received from this Offering are not enough to
accomplish those things we will have to obtain additional
financing through an additional offering or through capital
contributions by current shareholders. No commitments to provide
additional funds have been made by management or shareholders.
You cannot be sure that any additional funds will be available on
terms acceptable to Paragon Polaris or at all. We expect to
begin earning revenues shortly after a sales force is in place.
Growth of the Internet and electronic commerce.
The Internet has become an increasingly significant medium for
communication, information and commerce. According to NUA
Internet Surveys, as of February 2000, there were approximately
275.5 million Internet users worldwide. At the IDC Internet
Executive Forum held on September 28-29, 1999, IDC stated that in
1999 US $109 billion in purchases were impacted by the Internet.
IDC's vice president, Sean Kaldor, indicated that figure is
expected to increase more than ten-fold over the next five years
to US $1.3 trillion in 2003, with $842 million completed directly
over the Web. Paragon Polaris believes that this dramatic growth
presents very real opportunities for online retailers.
The vitamin, supplement, mineral and alternative health product
market
In recent years, a growing awareness of vitamins, herbs, and
other dietary supplements by the general public has created a
whole new segment in the field of medicine and health care
products. According to Jupiter Communications, online sales of
such products are expected to be $434 million in the year 2003,
up from $1 million in 1998. Paragon Polaris believes that several
factors are driving this growth, including a rapidly growing
segment of the population that is concerned with aging and
disease. There is also a growing interest in preventative health
care, favorable consumer attitudes toward alternative health
products and a favorable regulatory statute, the Dietary
Supplement Health and Education Act of 1994.
The electronic commerce industry is new, rapidly evolving and
intensely competitive, and Paragon Polaris expects competition to
intensify in the future. Barriers to entry are minimal and
current and new competitors can launch sites at a relatively low
cost. In addition, the vitamin supplement, mineral and
alternative health product market is very competitive and highly
fragmented, with no clear dominant leader and increasing public
and commercial attention.
Paragon Polaris's competitors can be divided into several groups
including:
- traditional vitamins, supplements, minerals and alternative
health products retailers;
- the online retail initiatives of several traditional
vitamins, supplements, minerals and alternative health products
retailers;
- online retailers of pharmaceutical and other health-related
products that also carry vitamins, supplements, minerals and
alternative health products;
- independent online retailers specializing in vitamins,
supplements, minerals and alternative health products;
- mail-order and catalog retailers of vitamins, supplements,
minerals and alternative health products, some of which have
already developed online retail outlets; and
- direct sales organizations, retail drugstore chains, health
food store merchants, mass market retail chains and various
manufacturers of alternative health products.
Many of Paragon Polaris's potential competitors have longer
operating histories, larger customer or user base, greater brand
recognition and significantly greater financial, marketing and
other resources than we have. In addition, an online retailer
may be acquired by, receive investments from, or enter into other
commercial relationships with, larger, well-established and well-
financed companies as use of the Internet and other electronic
services increases.
Competitors have and may continue to have aggressive pricing
policies and devote substantially more resources to website and
systems development than Paragon Polaris does. Increased
competition may result in reduced operating margins and loss of
market share.
Paragon Polaris believes that the principal competitive factors
in its market are:
- ability to attract and retain customers;
- variety of product selection;
- product pricing;
- ability to customize products and labeling;
- quality and responsiveness of customer service.
We believe that we can compete favorably on these points.
However, we will have no control over how successful our
competitors are in addressing these factors. In addition Paragon
Polaris online competitors can duplicate many of the products or
services offered on the Vitamineralherb.com site.
Paragon Polaris believes that traditional retailers of vitamins,
supplements, minerals and other alternative health products face
several challenges in succeeding.
- Lack of convenience and personalized service. Traditional
retailers have limited store hours and locations. Traditional
retailers are also unable to provide consumers with product
advice tailored to their particular situation.
- Limited product assortment. The capital and real estate
intensive nature of store-based retailers limit the product
selection that can be economically offered in each store
location.
- Lack of customer loyalty. Although the larger traditional
retailers often attract customers, many of these customers are
only one-time users. People are often attracted to the name
brands, but find the products too expensive.
- the multilevel structure of some marketing organizations
mandates high prices.
As a result we believe there is significant unmet demand for a
shopping channel like that of Vitamineralherb.com that can
provide consumers of vitamins, supplements, minerals and other
alternative health products with a broad array of products and a
convenient and private shopping experience.
Paragon Polaris hopes to attract and retain consumers through the
following key attributes of its business:
- Broad Expandable Product Assortment. Paragon Polaris
product selection is substantially larger than that offered by
store-based retailers.
- Low Product Prices. Product prices can be kept low due to
volume purchases through Paragon Polaris's affiliation with
Vitamineralherb.com and other licensees. Having no inventory,
warehouse space and the need for limited administration will also
make our prices lower.. All products are shipped from
International Formulation and Manufacturing's inventory.
- Accessibility to Customized Products. At minimal cost,
health and fitness practitioners may offer their customers
customized products.
- Access to Personalized Programs. Health or fitness
professional can tailor vitamin and dietary supplement regimes to
their clients.
Regulatory Environment
The manufacturing, processing, formulating, packaging, labeling
and advertising of the products Paragon Polaris sells will be
subject to regulation by one or more U.S. federal agencies,
including the Food and Drug Administration, the Federal Trade
Commission, the United States Department of Agriculture and the
Environmental Protection Agency. These activities also may be
regulated by various agencies of the states, localities and
foreign countries in which consumers reside.
The Food and Drug Administration, in particular, regulates the
formulation, manufacture, labeling and distribution of foods,
including dietary supplements, cosmetics and over-the- counter or
homeopathic drugs. Under the Federal Food, Drug, and Cosmetic
Act, the Food and Drug Administration may undertake enforcement
actions against companies marketing unapproved drugs, or
"adulterated" or "misbranded" products. The remedies available
to the Food and Drug Administration include: criminal
prosecution; an injunction to stop the sale of a company's
products; seizure of products; adverse publicity; and "voluntary"
recalls and labeling changes.
Food and Drug Administration regulations require that certain
informational labeling be presented in a prescribed manner on all
foods, drugs, dietary supplements and cosmetics. Specifically,
the Food, Drug, and Cosmetic Act requires that food, including
dietary supplements, drugs and cosmetics, not be "misbranded". A
product may be deemed an unapproved drug and "misbranded" if it
bears improper claims or improper labeling.
The Food and Drug Administration has indicated that promotional
statements made about dietary supplements on a company's website
may constitute "labeling" for purposes of compliance with the
provisions of the Food, Drug, and Cosmetic Act. A manufacturer or
distributor of dietary supplements must notify the Food and Drug
Administration when it markets a product with labeling claims
that the product has an affect on the structure or function of
the body. Noncompliance with the Food, Drug, and Cosmetic Act,
and recently enacted amendments to that Act discussed below,
could result in enforcement action by the Food and Drug
Administration.
The Food, Drug, and Cosmetic Act has been amended several times
with respect to dietary supplements, most recently by the
Nutrition Labeling and Education Act of 1990 and the Dietary
Supplement Health and Education Act of 1994. The Dietary
Supplement Health and Education Act created a new statutory
framework governing the definition, regulation and labeling of
dietary supplements.
With respect to definition, the Dietary Supplement Health and
Education Act created a new class of dietary supplements,
consisting of vitamins, minerals, herbs, amino acids and other
dietary substances for human use to supplement the diet, as well
as concentrates, metabolites, extracts or combinations of such
dietary ingredients.
Generally, under the Dietary Supplement Health and Education Act,
dietary ingredients that were on the market before October 15,
1994 may be sold without Food and Drug Administration pre-
approval and without notifying the Food and Drug Administration.
In contrast, a new dietary ingredient, i.e., one not on the
market before October 15, 1994, requires proof that it has been
used as an article of food without being chemically altered or
evidence of a history of use or other evidence of safety
establishing that it is reasonably expected to be safe.
Retailers, in addition to dietary supplement manufacturers, are
responsible for ensuring that the products they market for sale
comply with these regulations. Noncompliance could result in
enforcement action by the Food and Drug Administration, an
injunction prohibiting the sale of products deemed to be non-
compliant, the seizure of such products and criminal prosecution.
The Food and Drug Administration has indicated that claims or
statements made on a company's website about dietary supplements
may constitute "labeling" and thus be subject to regulation by
the Food and Drug Administration. With respect to labeling, the
Dietary Supplement Health and Education Act amends, for dietary
supplements, the Nutrition Labeling and Education Act by
providing that "statements of nutritional support" also referred
to as "structure/function claims" may be used in dietary
supplement labeling without Food and Drug Administration pre-
approval, provided certain requirements are met.
These statements may describe how particular dietary ingredients
affect the structure or function of the body, or how a dietary
ingredient may affect body structure or function, but may not
state a drug claim. Here is an example: a claim that a dietary
supplement will diagnose, mitigate, treat, cure or prevent a
disease. A company making a "statement of nutritional support"
must possess substantiating evidence for the statement, disclose
on the label that the Food and Drug Administration has not
reviewed the statement and that the product is not intended for
use for a disease and notify the Food and Drug Administration of
the statement within 30 days after its initial use.
It is possible that the statements presented in connection with
product descriptions on Vitamineralherb.com site may be
determined by the Food and Drug Administration to be drug claims
rather than acceptable statements of nutritional support. In
addition, some of our suppliers may incorporate objectionable
statements directly in their product names or on their products'
labels, or otherwise fail to comply with applicable
manufacturing, labeling and registration requirements for over-
the-counter or homeopathic drugs or dietary supplements. As a
result, Vitamineralherb.com may have to remove some statements or
products from its site or modify these statements, names or
labels, in order to comply with Food and Drug Administration
regulations. Such changes could interfere with Paragon Polaris
marketing of products and could cause us to incur significant
additional expenses.
In addition, the Dietary Supplement Health and Education Act
allows the dissemination of "third party literature" in
connection with the sale of dietary supplements to consumers at
retail if the publication meets statutory requirements. Under
the Dietary Supplement Health and Education Act, "third party
literature" may be distributed if, among other things, it is not
false or misleading, no particular manufacturer or brand of
dietary supplement is promoted, a balanced view of available
scientific information on the subject matter is presented and
there is physical separation from dietary supplements in stores.
The extent to which this provision may be used by online
retailers is not yet clear, and we cannot assure you that all
pieces of "third party literature" that may be put out in
connection with the products Paragon Polaris offers for sale will
be determined to be lawful by the Food and Drug Administration.
Any such failure could make that product an unapproved drug or a
"misbranded" product, and maybe exposing us to enforcement action
by the Food and Drug Administration. This could require the
removal of the non-compliant literature from the
Vitamineralherb.com website or the modification of Paragon
Polaris selling methods. This could interfere with the marketing
of that product and cause us to incur significant additional
expenses.
Given the fact that the Dietary Supplement Health and Education
Act was enacted only five years ago, the Food and Drug
Administration's regulatory policy and enforcement positions on
certain aspects of the new law are still evolving. Moreover,
ongoing and future litigation between dietary supplement
companies and the Food and Drug Administration will likely
further refine the legal interpretations of that Act. As a
result, the regulatory status of certain types of dietary
supplement products, as well as the nature and extent of
permissible claims will remain unclear for the foreseeable
future.
Two areas in particular that pose potential regulatory risks are
the limits on claims implying some benefit or relationship with a
disease or related condition and the application of the physical
separation requirement for "third party literature" as applied to
Internet sales.
In addition to the regulatory situation under the Food, Drug and
Cosmetic Act, the advertising and promotion of dietary
supplements, foods, over-the-counter drugs and cosmetics is
subject to scrutiny by the Federal Trade Commission. The Federal
Trade Commission Act prohibits "unfair or deceptive" advertising
or marketing practices, and the it has pursued numerous food and
dietary supplement manufacturers and retailers for deceptive
advertising or failure to substantiate promotional claims,
including, in many instances, claims made via the Internet.
The Federal Trade Commission has the power to seek administrative
or judicial relief prohibiting a wide variety of claims, to
enjoin future advertising, to seek redress or restitution
payments and to seek a consent order and seek monetary penalties
for the violation of a consent order. In general, existing laws
and regulations apply fully to transactions and other activity on
the Internet. The Federal Trade Commission is in the process of
reviewing its policies regarding the applicability of its rules
and its consumer protection guides to the Internet and other
electronic media.
The Federal Trade Commission has already undertaken a new
monitoring and enforcement initiative, "Operation Cure-All"
targeting allegedly bogus health claims for products and
treatments offered for sale on the Internet. Many states impose
their own labeling or safety requirements that differ from or add
to existing federal requirements.
Paragon Polaris cannot predict the nature of any future laws,
regulations, interpretations or applications, nor can it say what
effect additional governmental regulations or administrative
orders would have on its business in the future. Although the
regulation of dietary supplements is less restrictive than that
of drugs and food additives, we cannot be sure that the current
laws and regulations concerning dietary supplements will remain
less restrictive.
The manufacturing, processing, formulating, packaging, labeling
and advertising of the products Paragon Polaris sells may also be
subject to regulation by one or more U.S. federal agencies,
including the Food and Drug Administration, the Federal Trade
Commission, the United States Department of Agriculture and the
Environmental Protection Agency. These activities also may be
regulated by various agencies of the states, localities and
foreign countries in which consumers reside.
Regulation of the Internet
In general, existing laws and regulations apply to the Internet.
The exact manner in which these laws and regulations affect the
Internet is sometimes uncertain. Most of these laws were adopted
prior to the Internet and do not address the unique issues of the
Internet or electronic commerce.
Numerous federal and state government agencies have already
demonstrated significant activity in promoting consumer
protection on the Internet. Due to the increasing use of the
Internet as a medium for commerce and communication, it is
possible that new laws and regulations could be passed. These
new laws and regulations could cover issues such as user privacy,
freedom of expression, advertising, pricing, content and quality
of products and services, taxation, intellectual property rights
and information security. The adoption of such laws or
regulations and the way existing laws and regulations apply to
the Internet may slow the growth of Internet use and result in a
decline in Paragon Polaris sales.
A number of legislative proposals have been made at the federal,
state and local level, and by foreign governments, that would
impose additional taxes on the sale of goods and services over
the Internet, and some states have taken measures to tax Internet-
related activities. Although Congress recently placed a three-
year moratorium on new state and local taxes on Internet access
or on discriminatory taxes on electronic commerce, existing state
or local laws were expressly excepted from this moratorium. Once
this moratorium is lifted, some type of federal and/or state
taxes may be imposed upon Internet commerce. Such legislation or
other attempts at regulating commerce over the Internet may
substantially affect growth and have a negative affect on our
business.
Employees
Paragon Polaris is a development stage company and currently has
no employees. Paragon Polaris is currently managed by Robert Foo
and Samuel Lau, its officers and directors. We look to the them
for their management and financial skills and talents.
Management plans to use consultants, attorneys and accountants as
necessary and does not plan to engage any full-time employees in
the near future other than sales people to set up accounts.
Available Information and Reports to Securities Holders
Paragon Polaris has filed with the Securities and Exchange
Commission a Registration Statement on Form SB-2 with respect to
the common stock offered by this Prospectus. This Prospectus,
which constitutes a part of the Registration Statement, does not
contain all of the information set forth in the Registration
Statement or the exhibits and schedules which are part of the
Registration Statement. For further information with respect to
Paragon Polaris and its common stock, see the Registration
Statement and the exhibits and schedules thereto. Any document
Paragon Polaris files may be read and copied at the Commission's
Public Reference Room located at 450 Fifth Street N.W.,
Washington D.C. 20549, and the public reference rooms in New
York, New York, and Chicago, Illinois. Please call the Commission
at 1-800-SEC-0330 for further information about the public
reference rooms. Paragon Polaris filings with the Commission are
also available to the public from the Commission's website at
http://www.sec.gov.
Upon completion of this offering, Paragon Polaris will become
subject to the information and periodic reporting requirements of
the Securities Exchange Act and, accordingly, will file periodic
reports, proxy statements and other information with the
Commission. Such periodic reports, proxy statements and other
information will be available for inspection and copying at the
Commission's public reference rooms, and the website of the
Commission referred to above.
Forward looking statements
You should not rely on forward-looking statements in this
Prospectus. This Prospectus contains forward-looking statements
that involve risks and uncertainties. We use words such as
anticipates", "believes", "plans", "expects", "future", "intends"
and similar expressions to identify these forward-looking
statements. Actual results could differ materially from those
anticipated in these forward-looking statements for many reasons.
Management's discussion and analysis or plan of operation.
Upon the completion of all or part of the sale of shares
contained in this Offering, Paragon Polaris intends to proceed as
quickly as possible to do an in-depth feasibility study and if
and when that study proves the project to be feasible, hire one
or more sales representatives to present its service to potential
customers. Geography is an obstacle that must be dealt with.
The states of Idaho and Oregon are very large, making adequate
coverage by one salesperson virtually impossible. A minimum of
two representatives will be necessary. After opening accounts,
these representatives will be necessary to service existing
customers. Research has indicated that this servicing or
detailing of already established accounts results in better
reorders.
Estimated expenses for the next twelve months are as follows:
Amount
Feasibility study $10,000
Two sales persons (draw against commissions)
@ $1000 per month 36,000
Administration 12,000
Employee benefits 16,000
Office rent 12,000
Office supplies ( including furniture) 10,000
Development stage costs 1,000
(including recruiting costs)
Website maintenance 500
Contingency (10%) 8,850
Total first year expenses $ 107,250
If the proposed offering proceeds are not received, operations
would be scaled down. One sales person would be hired instead of
two; administration would be handled by an officer and director
at no cost. The same officer and director would supply office
space during the start-up process. Growth would be much slower
and Paragon Polaris would not be able to rent office space and
hire administrative help until sales volumes and gross profits
were large enough. If no funds are received from this offering,
management would be forced to decide whether or not to proceed
with the business and either delay starting or cancel the project
completely.
Description of property.
Paragon Polaris maintains a mailing address at the office of one
of its shareholders, but otherwise does not maintain an office.
We pay no rent and own no real estate.
Certain Relationships and Related Transactions
Prior to the date of this Registration Statement Paragon Polaris
issued to ten individuals a total of 2,000,000 shares of Common
stock in consideration of acquiring the rights to manufacture and
market an oxygen-enhanced product for use in aquaculture, fish
and poultry farming and the bioremediation of waste ponds and
lagoons in the state of Pennsylvania. David R. Mortenson and
Associates acquired these rights from the inventors of the
product, N.W. Technologies Inc. under a distribution agreement.
In December, 1999 N.W. Technologies unilaterally canceled its
contract and distribution agreement with David R. Mortenson and
Associates. Mortenson and several of the concerns that have an
interest in the technology through distribution agreements with
Mortenson, have filed suit in Harris County court, Texas against
N.W. Technologies Inc, its officers and directors and several
other individuals and concerns involved with the cancellation and
withdrawal.
Paragon Polaris is not withdrawing from its agreement with
Mortenson for the distribution and manufacture of the oxygen-
enhanced products, nor has it any intention of doing so at the
present time. All obligations under that agreement have been
suspended until the lawsuit is resolved.
In order to avoid litigation with Paragon Polaris and to protect
our shareholders Mortenson granted a distribution license for an
Internet based vitamin and health supplement company. The
company, Vitamineralherb.com, is located San Diego, California.
There was no charge for this distribution license for the states
of Idaho and Oregon.
Market for common equity and related stockholder matters.
Paragon Polaris is a development stage company that is still in
the beginning stages of implementing its business plan. No
market currently exists for the Common Stock. Upon completion of
all or part of the offering of common shares contained in this
Registration Statement, it is the intention of Paragon Polaris to
apply for a trading symbol and a listing to have its shares
quoted on the NASD OTC Bulletin Board.
There can be no assurance that any part of this Offering will be
subscribed to and if all or part of the Offering is subscribed
to, that the request of Paragon Polaris to have the price of its
stock quoted on the OTC Bulletin Board will be granted. You
should take all of the above facts into consideration before
making a decision to purchase any amount of Paragon Polaris
stock.
Executive compensation
No officer or director of Paragon Polaris has received any
remuneration. Although there is no current plan in existence, it
is possible that Paragon Polaris will adopt a plan to pay or
accrue compensation to its officers and directors for services
related to the implementation of the business plan. See "Certain
Relationships and Related Transactions". Paragon Polaris has no
stock option, retirement, pension or profit-sharing programs for
the benefit of directors, officers or other employees, but the
Board of Directors may recommend adoption of one or more such
programs in the future.
PARAGON POLARIS STRATAGIES.COM INC.
(A Development Stage Enterprise)
Interim Financial Statements
(Prepared by Management)
As at June 30, 2000 and December 31, 1999
PARAGON POLARIS STRATAGIES.COM INC.
(a Development Stage Enterprise)
BALANCE SHEETS
As at June 30, 2000 and December 31, 1999
(Prepared by Management)
ASSETS
June 30, 2000 December 31,1999
Unaudited Audited
CURRENT ASSETS: 207 0
TOTAL CURRENT ASSETS 207 0
OTHER ASSETS
LICENSE RIGHTS 2,000 2,000
TOTAL ASSETS 2,207 2,000
LIABILITIES AND STOCKHOLDERS EQUITY
CURRENT LIABILITIES:
ACCOUNTS PAYABLE 0 1,200
TOTAL CURRENT LIABILITIES 0 1,200
STOCKHOLDERS EQUITY:
Common stock, $0.001 par
Value; 100,000,000 shares
Authorized, and 2,600,000 (2,500,000)
Shares
Issued and outstanding 2,600 2,500
ADDITIONAL PAID-IN CAPITAL 12,055 155
(DEFICIT ACCUMULATED DURING
THE DEVELOPMENT STAGE) (12,448) (1,855)
TOTAL STOCKHOLDERS' EQUITY 2,207 800
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY 2,207 2,000
PARAGON POLARIS STRATAGIES.COM INC.
(A Development Stage Enterprise)
STATEMENT OF OPERATIONS
For the six months ended June 30, 2000 and for the period
May 28, 1999 (Inception) to December, 31, 1999
(Prepared by Management)
June 30, 2000 December 31,1999
Unaudited Audited
REVENUES: 0 0
OPERATING EXPENSES:
TAXES AND LICENSES 0 320
OFFICE EXPENSES 93 130
LEGAL AND ACCOUNTING FEES 8,750 1,405
CONSULTING FEES 1,750 0
TOTAL OPERATING EXPENSES 10,593 1,855
NET (LOSS) FOR THE PERIOD (10,593) (1,855)
NET (LOSS) PER SHARE $ (0.00) $ (0.00)
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 2600000 2500000
PARAGON POLARIS STRATAGIES.COM INC.
(A Development Stage Enterprise)
STATEMENT OF CASH FLOWS
For the six months ending June 30, 2000 and the Period
May 28, 1999 (Inception) through December 31, 2000
(Prepared by Management)
May 31, 2000 December 31,1999
Unaudited Audited
CASH FLOWS FROM (TO)
OPERATING ACTIVITIES:
NET INCOME (LOSS) (10,593) (1,855)
NET INCREASE (DECREASE)
IN ACCOUNTS PAYABLE (1,200) 1,200
NET CASH (USED) BY OPERATING
ACTIVITIES (11,793) (655)
CASH FLOWS FROM (TO)
INVESTING ACTIVITIES:
PURCHASE OF LICENSE RIGHTS 0 (2,000)
CASH FLOWS FROM (TO)
FINANCING ACTIVITIES:
ISSUANCE OF COMMON STOCKS 12,000 2,655
NET INCREASE (DECREASE) IN CASH 207 0
CASH, BEGINNING OF PERIOD 0 0
CASH, END OF PERIOD 207 0
FINANCIAL STATEMENTS.
PARAGON POLARIS STRATAGIES.COM INC.
(A Development Stage Enterprise)
AUDIT REPORT
December 31, 1999
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1777 S. Harrison Street, Suite 2100
Denver, Colorado 80210
PARAGON POLARIS STRATAGIES.COM INC.
(A Development Stage Enterprise)
FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS
TABLE OF CONTENTS
ITEM
PAGE
Report of Certified Public Accountant.................. F1
Balance Sheet, December 31, 1999 ......................... F2
Statement of Operations, for the
Period April 2, 1999 (Inception)
Through December 31, 1999................................. F3
Statement of Stockholders' Equity
(Deficit), April 2, 1999 (Inception)
Through December 31, 1999................................. F4
Statement of Cash Flows for the
Period From April 2, 1999 (Inception)
Through December 31, 1999 ................................ F5
Notes to Financial Statements............................ F6 & F7
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1777 S. Harrison Street, Suite 2100
Denver, Colorado 80210
(303) 782-0878
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Paragon Polaris Stratagies.com Inc.
404 Scott Point Drive
Salt Spring Island, British Columbia V8K 2R2
Canada
I have audited the accompanying Balance Sheet of Paragon Polaris
Stratagies.com Inc.. (A Development Stage Enterprise) as of December
31, 1999 and the Statements of Operations, Stockholders' Equity, and
Cash Flows for the period May 27, 1999 (Inception) through December
31, 1999. These financial statements are the responsibility of the
Company's management. My responsibility is to express an opinion on
these financial statements based on my audits.
My examination was made in accordance with generally accepted
auditing standards. Those standards require that I plan and perform
the audits to obtain reasonable assurance as to whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. I believe that our audit provides a
reasonable basis for our opinion.
In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of
Xunantunich, Inc.(a development stage enterprise) as of December 31,
1999, and the results of its operations and changes in its cash
flows for the period from May 27, 1999 (Inception) through December
31, 1999, in conformity with generally accepted accounting
principles.
Janet Loss, C.P.A., P.C.
March , 2000
F-1
PARAGON POLARIS STRATEGIES.COM INC.
(A Development Stage Enterprise)
BALANCE SHEET
December 31, 1999
ASSETS
CURRENT ASSETS:
License Rights $ 2,000
TOTAL ASSETS $ 2,000
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts Payable $ 1,200
STOCKHOLDERS' EQUITY:
Common stock, $0.001 par
Value; 25,000,000 shares
Authorized, and 2,500,000 shares
Issued and outstanding $ 2,500
Additional Paid-In Capital 155
(Deficit) (1,855)
Total Stockholders' Equity (Deficit) 800
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 2,000
The accompanying notes are an integral part of the financial statements.
F-2
PARAGON POLARIS STRATEGIES.COM Inc.
(A Development Stage Enterprise)
STATEMENT OF OPERATIONS
For the Period May 27, 1999 (Inception)
Through December 31, 1999
REVENUES: $ 0
OPERATING EXPENSES:
Accounting and Legal Fees $ 1,405
Office Expenses 130
Other Fees 320
TOTAL OPERATING EXPENSES 1,855
NET (LOSS) $ (1,855)
NET (LOSS) PER SHARE $ (0.0007)
Weighted Average Number of
Common Shares Outstanding 2,500,000
The accompanying notes are an integral part of the financial statements.
F-3
PARAGON POLARIS STRATAGIES.COM INC.
(a Development Stage Enterprise)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
For the Period May 27, 1999 through December 31, 1999
<TABLE>
<CAPTION>
(Deficit)
Accumulated
Common Common Additional Total
Stock Stock Paid- in During Stockholders
Number of Amount Capital the Equity
Shares Development
Stage
<S> <C> <C> <C> <C> <C>
May 28, 1999
Issuance of 500,000 500 155 0 655
Common Stock for
Cash
Issuance of Common
Stock 2000000 2,000 0 0 2,000
For License Rights
Deficit for the
Period From
May 27, 1999
(Inception) 0 0 0 (1,855) (1,855)
Through December 31,
1999
Balance December 31 2500000 2500 155 (1,855) 800
1999
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-4
PARAGON POLARIS STRATEGIES.COM INC.
(A Development Stage Enterprise)
STATEMENT OF CASH FLOWS
For the Period May 28, 1999 (Inception)
Through December 31, 1999
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net Income (Loss) (1,855)
Change in Assets and Liabilities:
Increase in Accounts Payable 1,200
Net Cash (Used) by Operating Activities (655)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of License Rights (2,000)
CASH FLOWS FROM (TO) FINANCING ACTIVITIES:
Issuance of Common Stocks 2,655
INCREASE (DECREASE) IN CASH 0
CASH, BEGINNING OF PERIOD 0
CASH, END OF PERIOD 0
The accompanying notes are an integral part of the
financial statements.
F-5
PARAGON POLARIS STRATEGIES.COM INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 1999
NOTE I - ORGANIZATION AND HISTORY
The Company is a Nevada Corporation and the Company has
been in the development stage since its formation on
May 28, 1999.
The Company's only activities have been organizational,
directed at acquiring its principle assets, raising its
initial capital and developing its business plan.
NOTE II - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
DEVELOPMENT STAGE ACTIVITIES
The Company has been in the development stage since
inception.
ACCOUNTING METHOD
The Company records income and expenses on the accrual
method.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents includes cash on hand, cash
on deposit, and highly liquid investments with
maturities generally of three months or less. At
December 31, 1999, there were no cash equivalents.
YEAR END
The Company has elected to have a fiscal year ended
December 31st.
F 6
USE OF ESTIMATES
The preparation of financial statements in accordance
with generally accepted accounting principles requires
management to make estimates and assumptions that
effect the reported amounts of assets and liabilities
at the date of financial statements, as well as
revenues and expenses reported for the periods
presented. The Company regularly assesses these
estimates and, while actual results may differ
management believes that the estimates are reasonable.
NOTE III - RELATED PARTY TRANACTIONS
The Company has entered into an agreement made
effective July 1, 1999 with David R. Mortenson &
Associates (Grantor) to receive the rights to
distribute the products developed by NW Technologies,
Inc.
The Company agrees to pay the Grantor the sum of $2,000
in the sum of 2,000,000 shares of common stock having a
par value of $0.001 per share. Minimum purchase
requirements are $125,000 the first year and $175,000
the second year. While the 2000,000 shares were
issued, all other payments were delayed by the Grantor
for a period of six months.
Management puts a fair market value of $2,000 on the
license. The agreement with David R. Mortenson &
Associates was entered into by previous management.
NOTE IV - SUBSEQUENT EVENTS
In December, 1999 N.W. Technologies, Inc. unilaterally
cancelled its contract with David Mortenson &
Associates. Early in the year 2000 David Mortenson &
Associates laid suit against N.W. Technologies, Inc. in
Harris County Court, Texas.
In the opinion of management, the Company has no direct
or indirect interest in the Texas lawsuit
In a letter dated January 5, 2000 David Mortenson &
Associates suspended all present and future payments
under the License Agreement until their dispute with
N.W. Technologies is resolved.
On January 20, 2000 David Mortenson & Associates gave
the Company a License to distribute vitamins, minerals,
herbs and other health products and supplements through
the Internet. The license calls for a 10% add-on for
all products purchased and an annual $500 website
maintenance fee. The effective date of the License
Agreement was January 3, 2000.
David R. Mortenson is a principal in both David
Mortenson & Associates and Vitamineralherb.com. He is
at arms length with the Company.
F 7
Changes in and Disagreements with Accountants on
Accounting and Financial disclosure.
There have been no changes in and/or disagreements with
Janet Loss, C.P.A., P.C. on accounting and financial
disclosure matters.
PART II - Information Not Required in Prospectus
Indemnification of directors and officers.
Pursuant to Nevada law, a corporation may indemnify a
person who is a party or threatened to be made a party
to an action, suit or proceeding by reason of the fact
that he or she is an officer, director, employee or
agent of the corporation, against such person's costs
and expenses incurred in connection with such action so
long as he/she has acted in good faith and in a manner
which he/she reasonably believed to be in, or not
opposed to, the best interests of the corporation, and,
in the case of criminal actions, had no reasonable
cause to believe his or her conduct was unlawful.
Nevada law requires a corporation to indemnify any such
person who is successful on the merits or defense of
such action against costs and expenses actually and
reasonably incurred in connection with the action.
The bylaws of Paragon Polaris filed as Exhibit 3.2,
provide that Paragon Polaris will indemnify its
officers and directors for costs and expenses incurred
in connection with the defense of actions, suits, or
proceedings against them on account of their being or
having been directors or officers of Paragon Polaris,
absent a finding of negligence or misconduct in office.
The Bylaws also permit Paragon Polaris to maintain
insurance on behalf of its officers, directors,
employees and agents against any liability asserted
against and incurred by that person whether or not
Paragon Polaris has the power to indemnify such person
against liability for any of those acts.
Other expenses of issuance and distribution.
Expenses incurred or (expected) relating to this
Registration Statement and distribution are as follows:
Legal fees 8,500.00
Accounting 1,500.00
(Edgar filing and Printing) 5,000.00
TOTAL 15,000.00
To date Paragon Polaris has spent a total of $11,383
for office expenses and legal and accounting fees.
Recent sales of unregistered securities.
Set forth below is information regarding the issuance
and sales of Paragon Polaris securities without
registration since its formation. No such sales
involved the use of an underwriter and no commissions
were paid in connection with the sale of any
securities.
On May 28, 1999, Paragon Polaris issued 500,000 shares
of common stock to the officers and directors as
founders' shares in return for the time, effort and
expenditures to organize and form the corporation. On
June 18, 1999 Paragon Polaris issued 200,000 shares of
common stock each to ten individuals for a total of
2,000,000 shares in return for the water treatment
rights for the state of Pennsylvania and the
development of the business plan.
On January 17, 2000 the 500,000 founders' shares of
common stock were purchased by the present Officers and
Directors.
Exhibits.
The following exhibits are filed as part of this
Registration Statement;
Exhibit
Number Description
3.1 Articles of Incorporation
3.2 Bylaws
5.1 Opinion re: Legality
10.1 License Agreement
10.2 Assignment of License Agreement
10.3 License Agreement-Water
23.1 Consent of Independent Auditors
23.2 Consent of Counsel (See Exhibit 5.1)0
Undertakings.
The undersigned registrant hereby undertakes:
1) To file, during any period in which offers or sales
are being made, a post-effective amendment to
this Registration Statement:
(a) To include any Prospectus required by section
10(a)(3) of the Securities Act of 1933;
(b) To reflect in the Prospectus any facts or
events arising after the effective date of the
Registration Statement (or the most recent post-
effective amendment thereof) which,
individually or in the aggregate, represent a
fundamental change in the information set forth
in the Registration Statement. Notwithstanding
the foregoing, any increase or decrease in
volume of securities offered.
(c) To include any additional or changed material
information to the plan of distribution.
2) For determining liability under the Securities
Act, treat each post-effective amendment as a new
Registration Statement of the securities offered and
the offering of the securities at that time to be the
initial bona fide offering.
3) file a post-effective amendment to remove
from registration any of the securities being
registered, which remain unsold at the end of the
offering.
4) For determining any liability under the Securities
Act, to treat the information omitted from the form of
Prospectus filed as part of this Registration Statement
in reliance upon Rule 430A and contained in a form of
Prospectus filed by the registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act as
part of this Registration Statement as of the time the
Commission declared it effective.
5) For determining any liability under the Securities
Act to treat each post-effective amendment that
contains a form of Prospectus as a new Registration
Statement for the securities offered and the offering
of the securities at that time as the initial bona
fide Offering of those Securities.
Signatures
In accordance with the requirements of the Securities
Act of1933, the In accordance with the requirements of
the Securities Act of1933, the Registrant certifies
that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form SB-2 and
authorized this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly
authorized, in the City of Vancouver, Province of
British Columbia Canada
On June 27, 2000
(Registrant) Paragon Polaris Stratagies.com Inc.
By: /S/Robert Foo By: /S/ Samuel Lau
Robert Foo, President Samuel Lau, Secretary
Treasurer
Date: June 27, 2000 Date: June 27, 2000
EXHIBIT 3.1
ARTICLES OF INCORPORATION
Of
PARAGON POLARIS STRATAGIES.COM INC.
ARTICLES OF INCORPORATION
of
PARAGON POLARIS STRATAGIES.COM INC.
The undersigned natural person of the age of eighteen years
or more, acting as incorporator of a corporation under and
pursuant to the laws of the State of Nevada, hereby adopts
the following Articles of Incorporation for such
corporation:
ARTICLE I
The name of the corporation is PARAGON POLARIS
STRATAGIES.COM INC.
ARTICLE II
The principal office of this corporation is to be at 50 West
Liberty Street #880, Reno, 89501, State of Nevada. The
Nevada Agency and Trust Company is hereby named as Resident
Agent of this corporation and in charge of its said office
in Nevada.
ARTICLE III
The nature of the business, objects and purposes to be
transacted, promoted, or carried on by the corporation are:
A To conduct any lawful business, to promote any lawful
purpose, and to engage in any lawful act or activity for
which corporations maybe organized under the General
Corporation Law of the State of Nevada and to act in every
kind of fiduciary capacity. and generally to do all things
necessary or convenient which are incident to or which a
natural person might or could do.
B To purchase, receive, take by grant, gift, devise,
bequest, or otherwise. lease, or otherwise acquire, own,
hold, improve, employ, use and otherwise deal in and with
real or personal property, or any interest therein, wherever
situated, and to sell, convey, lease, exchange, transfer or
otherwise dispose of, or mortgage or pledge, all or any of
its property and assets, or any interests therein, wherever
situated.
C To engage generally in the real estate business as
principal, and in any lawful capacity, and generally to
take, lease, purchase, or otherwise acquire, and to own,
use, hold, sell, convey, exchange, lease, mortgage, work,
clear, improve, develop, divide, and otherwise handle,
manage, operate, deal in and dispose of mining claims, oil
leases, oil and gas wells, real estate, real property,
lands, multiple-dwelling structures, houses, buildings and
other works and any interest or right therein; to take,
lease, purchase or otherwise handle or acquire, and to own,
use, hold, sell, convey, exchange, hire, lease, pledge,
mortgage, and otherwise handle, and deal in and dispose of,
as principal agent or in any lawful capacity, such personal
property, chattels, chattels real, rights, easements,
privileges, causes in action, notes, bonds, mortgages, and
securities as may lawfully be acquired, held or disposed of
and to acquire, purchase, sell, assign, transfer, dispose of
and generally deal in and with as principal, agent, broker,
and in any lawful capacity, mortgages and other interests in
real, personal, and mixed properties; to carry on a general
oil exploration, mining exploration and management business
as principal, agent, representative, contractor, sub-
contractor, and in any other lawful capacity. To
manufacture, purchase or acquire in any lawful manner and to
hold, own, mortgage, pledge, sell, transfer, or in any
manner dispose of, and to deal and trade in goods, wares,
merchandise, and property of any and every class and
description, and in any part of the world.
D To apply for, register, obtain, purchase, lease,
take licenses in respect of or otherwise acquire, and to
hold, own, use, operate, develop, enjoy, turn to account,
grant licenses and immunities in respect of, manufacture
under and to introduce, sell, assign, mortgage, pledge or
otherwise dispose of and, in any manner deal with and
contract with reference to:
1. Inventions, devices, formulas, processes, improvements
and modifications thereof;
2. Letters patent, patent rights, patented processes,
rights, designs, and similar rights, trademarks, trade
names, trade symbols and other indications or origin and
ownership granted by or recognized under the laws of the
United States of America, any state or subdivision thereof,
and any commonwealth, territory, possession, dependency,
colony, possession agency or instrumentality of the United
States of America and of any foreign country, and all rights
connected therewith or appertaining thereto.
3. Franchises licenses, grants and concessions.
E To make, enter into, perform and carry out contracts of
every kind and description with any person, firm,
association, corporation or government or agency or
instrumentality thereof.
F To lend money in furtherance of its corporate purposes
and to invest and reinvest its funds from time to time to
such extent, to such persons, firms, associations,
corporations, governments or agencies or instrumentality's
thereof, and on such terms and on such security, if any, as
the Board of Directors of the corporation may determine and
direct any officer to complete.
G To borrow money without limit as to amount and at such
rates of interest as it may determine; from time to time to
issue and sell its own securities, including its shares of
stock, notes, bonds, debentures, and other obligations, in
such amounts, on such terms and conditions, for such
purposes and for such prices, now or hereafter permitted by
the laws of the State of Nevada and by the Board of
Directors of the corporation as they may determine; and to
secure any of its obligations by mortgage, pledge or other
encumbrance of any or all of its property, franchises and
income.
H To be a promoter or manager of other corporations of
any type or kind; and to participate with others in any
corporation, partnership, limited partnership, joint
venture, or other association of any kind, or in any
transaction, undertaking or arrangement which the
corporation would have power to conduct by itself, whether
or not such participation involves sharing or delegation of
control with or to others.
I To promote and exercise all or any part of the
foregoing purposes and powers in and all parts of the world,
and to conduct its business in all or any branches in any
lawful capacity.
The foregoing enumeration of specific purposes and powers
shall not be held to limit or restrict in any manner the
purposes and powers of the corporation by references to or
inference from the terms or provisions of any other clause,
but shall be regarded as independent purposes.
ARTICLE IV
The aggregate number of shares, which the corporation shall
have authority to issue, is 25,000,000 shares of common
stock with $0.001 par value each.
No shareholder of the corporation shall have the right of
cumulative voting at any election of directors or upon any
other matter.
No holder of securities of the corporation shall be entitled
as a matter of right, preemptive or otherwise, to subscribe
for or purchase any securities of the corporation now or
hereafter authorized to be issued, or securities held in the
treasury of the corporation, whether issued or sold for cash
or other consideration or as a share dividend or otherwise.
Any such securities may be issued or disposed of by the
board of directors to such persons and on such terms as in
its discretion it shall deem advisable.
ARTICLE V
Any action required to, or that may, be taken at any annual
or special meeting of shareholders may be taken without a
meeting, without prior notice and without a vote, if a
consent or consents in writing, setting forth the action so
taken, shall be signed by the holder or holders of shares
having not less than the minimum number of votes that would
be necessary to take such action at a meeting at which the
holders of all shares entitled to vote on the action were
present and voted.
ARTICLE VI
The members of the governing board shall be styled DIRECTORS
and the number of such Directors shall be not less than one
(l), or more than five (5). The first board of directors
shall be Two Members whose names and post office addresses
are as follows:
J.P. Beehner
PO Box 2370
Alvin, TX 77512 - 2370
Dorothy A. Mortenson
P.O. Box 5034
Alvin, Texas 77512
ARTICLE VII
The initial number of stockholders will be two (2).
Additional stockholders may be obtained. The number of
directors may be changed as provided in N.R.S. 78.330.
ARTICLE VIII
A. No director of the corporation shall be liable to the
corporation or any of its shareholders for monetary damages
for an act or omission in the director's capacity as a
director, except that this Article VIII shall not authorize
the elimination or limitation of liability of a director of
the corporation to the extent the director is found liable
for: (i) a breach of such director's duty of loyalty to the
corporation or its shareholders; (ii) an act or omission not
in good faith that constitutes a breach of duty of such
director to the corporation or an act or omission that
involves intentional misconduct or a knowing violation of
the law; (iii) a transaction from which such director
received an improper benefit, whether or not the benefit
resulted from an action taken within the scope of the
director's office; or (iv) an act or omission for which the
liability of a director is expressly provided by an
applicable statute.
B. The capital stock of this corporation after the amount
of the subscription price or par value has been paid in,
shall not be subject to assessment to pay debts of this
corporation and no stock issued as fully paid up shall ever
be assessable or assessed and the Articles of Incorporation
shall not be amended in this particular.
ARTICLE IX
This corporation is to have perpetual existence.
Dorothy A. Mortenson, the undersigned, being the original
incorporator for the purpose of forming a corporation to do
business both within and without the state of Nevada, and in
pursuance of the General Corporation Law of the State of
Nevada, effective March 31, 1925 and as subsequently amended
do make and file this certificate, hereby declaring and
certifying that the facts herein above stated are true.
Dorothy A. Mortenson
22nd day of May, 1999.
Address: P.O. Box 5034
Alvin, TX 77512
EXHIBIT 3.2
BYLAWS OF
PARAGON POLARIS STRATAGIES INC. INC.
CONTENTS OF INITIAL BYLAWS
ARTICLE PAGE
1.00 CORPORATE CHARTER AND BYLAWS
1.01 Corporate Charter Provisions 4
1.02 Registered Agent or Office Requirement
of Filing Changes with Secretary of State 4
1.03 Initial Business Office 4
1.04 Amendment of Bylaws 4
2.00 DIRECTORS AND DIRECTORS MEETINGS
2.01 Action Without Meeting 5
2.02 Telephone Meetings 5
2.03 Place of Meetings 5
2.04 Regular Meetings 5
2.05 Call of Special Meeting 5
2.06 Quorum 6
2.07 Adjournment Notice of Adjourned Meetings 6
2.08 Conduct of Meetings 6
2.09 Powers of the Board of Directors 6
2.10 Board Committees Authority to Appoint 7
2.11 Transactions with Interested Directors 7
2.12 Number of Directors 7
2.13 Term of Office 7
2.14 Removal of Directors 8
2.15 Vacancies 8
2.15(a) Declaration of Vacancy 8
2.15(b) Filling Vacancies by Directors 8
2.15(c) Filling Vacancies by Shareholders 8
2.16 Compensation 9
2.17 Indemnification of Directors and Officers 9
2.18 Insuring Directors, Officers, and Employees 9
ARTICLE PAGE
3.00 SHAREHOLDERS MEETINGS
3.01 Action Without Meeting 9
3.02 Telephone Meetings 10
3.03 Place of Meetings 10
3.04 Notice of Meetings 10
3.04 Voting List 10
3.05 Votes per Share 11
3.07 Cumulative Voting 11
3.08 Proxies 11
3.09 Quorum 12
3.09(a) Quorum of Shareholders 12
3.09(b) Adjourn for Lack or Loss of Quorum 12
3.10 Voting by Voice or Ballot 12
3.11 Conduct of Meetings 12
3.12 Annual Meetings 12
3.13 Failure to Hold Annual Meeting 13
3.14 Special Meetings 13
4.00 OFFICERS
4.01 Title and Appointment 13
4.01(a) Chairman 13
4.01(b) President 14
4.01(c) Vice President 14
4.01(d) Secretary 14
4.01(e) Treasurer 15
4.01(f) Assistant Secretary or
Assistant Treasurer 15
4.02 Removal and Resignation 15
4.03 Vacancies 16
4.04 Compensation 16
5.00 AUTHORITY TO EXECUTE INSTRUMENTS
5.01 No Authority Absent Specific Authorization 16
5.02 Execution of Certain Instruments 16
6.00 ISSUANCE AND TRANSFER OF SHARES
6.01 Classes and Series of Shares 17
6.02 Certificates for Fully Paid Shares 17
6.03 Consideration for Shares 17
6.04 Replacement of Certificates 17
6.05 Signing Certificates Facsimile Signatures 18
6.06 Transfer Agents and Registrars 18
6.07 Conditions of Transfer 18
6.08 Reasonable Doubts as to Right to Transfer 18
7.00 CORPORATE RECORDS AND ADMINISTRATION
7.01 Minutes of Corporate Meetings 18
7.02 Share Register 19
7.03 Corporate Seal 19
7.04 Books of Account 19
7.05 Inspection of Corporate Records 20
7.06 Fiscal Year 20
7.07 Waiver of Notice 20
8.00 ADOPTION OF INITIAL BYLAWS 20
ARTICLE ONE - CORPORATE CHARTER AND BYLAWS
1.01 CORPORATE CHARTER PROVISIONS
The Corporation's Charter authorizes twenty-five million
(25,000,000) shares to be issued. The officers and transfer
agents issuing shares of the Corporation shall ensure that
the total number of shares outstanding at any given time
does not exceed this number. Such officers and agents shall
advise the Board at least annually of the authorized shares
remaining available to be issued. No shares shall be issued
for less than the par value stated in the Charter. Each
Charter provision shall be observed until amended by
Restated Articles or Articles of Amendment duly filed with
the Secretary of State.
1.02 REGISTERED AGENT AND OFFICEBREQUIREMENT OF FILING
CHANGES WITH SECRETARY OF STATE
The address of the Registered Office provided in the
Articles of Incorporation, as duly filed with the Secretary
of State for the State of Nevada, is: 50 West Liberty
Street, Suite 880, Reno, Nevada 89501.
The name of the Registered Agent of the Corporation at such
address, as set forth in its Articles of Incorporation, is:
Nevada Agency and Trust Company.
The Registered Agent or Office may be changed by filing a
Statement of Change of Registered Agent or Office or Both
with the Secretary of State, and not otherwise. Such filing
shall be made promptly with each change. Arrangements for
each change in Registered Agent or Office shall ensure that
the Corporation is not exposed to the possibility of a
default judgment. Each successive Registered Agent shall be
of reliable character and well informed of the necessity of
immediately furnishing the papers of any lawsuit against the
Corporation to its attorneys.
1.03 INITIAL BUSINESS OFFICE
The address of the initial principal business office of the
Corporation is hereby established as: 2400 Loop 35 #1502,
Alvin, Texas 77511.
The Corporation may have additional business offices within
the State of Nevada and where it may be duly qualified to do
business outside of Nevada, as the Board of Directors may
from time to time designate or the business of the
Corporation may require.
1.04 AMENDMENT OF BYLAWS
The Shareholders or Board of Directors, subject to any
limits imposed by the Shareholders, may amend or repeal
these Bylaws and adopt new Bylaws. All amendments shall be
upon advice of counsel as to legality, except in emergency.
Bylaw changes shall take effect upon adoption unless
otherwise specified. Notice of Bylaws changes shall be given
in or before notice given of the first Shareholders' meeting
following their adoption.
ARTICLE TWO - DIRECTORS AND DIRECTORS' MEETINGS
2.01 ACTION BY CONSENT OF BOARD WITHOUT MEETING
Any action required or permitted to be taken by the Board of
Directors may be taken without a meeting, and shall have the
same force and effect as a unanimous vote of Directors, if
all members of the Board consent in writing to the action.
Such consent may be given individually or collectively.
2.02 TELEPHONE MEETINGS
Subject to the notice provisions required by these Bylaws
and by the Business Corporation Act, Directors may
participate in and hold a meeting by means of conference
call or similar communication by which all persons
participating can hear each other. Participation in such a
meeting shall constitute presence in person at such meeting,
except participation for the express purpose of objecting to
the transaction of any business on the ground that the
meeting is not lawfully called or convened.
2.03 PLACE OF MEETINGS
Meetings of the Board of Directors shall be held at the
business office of the Corporation or at such other place
within or without the State of Nevada as may be designated
by the Board.
2.04 REGULAR MEETINGS
Regular meetings of the Board of Directors shall be held,
without call or notice, immediately following each annual
Shareholders' meeting, and at such other regularly repeating
times as the Directors may determine.
2.05 CALL OF SPECIAL MEETING
Special meetings of the Board of Directors for any purpose
may be called at any time by the President or, if the
President is absent or unable or refuses to act, by any Vice
President or any two Directors. Written notices of the
special meetings, stating the time and place of the meeting,
shall be mailed ten days before, or telegraphed or
personally delivered so as to be received by each Director
not later than two days before, the day appointed for the
meeting. Notice of meetings need not indicate an agenda.
Generally, a tentative agenda will be included, but the
meeting shall not be confined to any agenda included with
the notice.
Meetings provided for in these Bylaws shall not be invalid
for lack of notice if all persons entitled to notice consent
to the meeting in writing or are present at the meeting and
do not object to the notice given. Consent may be given
either before or after the meeting.
Upon providing notice, the Secretary or other officer
sending notice shall sign and file in the Corporate Record
Book a statement of the details of the notice given to each
Director. If such statement should later not be found in
the Corporate Record Book, due notice shall be presumed.
2.06 QUORUM
The presence throughout any Directors' meeting, or
adjournment thereof, of a majority of the authorized number
of Directors shall be necessary to constitute a quorum to
transact any business, except to adjourn. If a quorum is
present, every act done or resolution passed by a majority
of the Directors present and voting shall be the act of the
Board of Directors.
2.07 ADJOURNMENT AND NOTICE OF ADJOURNED MEETINGS
A quorum of the Directors may adjourn any Directors' meeting
to meet again at a stated hour on a stated day. Notice of
the time and place where an adjourned meeting will be held
need not be given to absent Directors if the time and place
is fixed at the adjourned meeting. In the absence of a
quorum, a majority of the Directors present may adjourn to a
set time and place if notice is duly given to the absent
members, or until the time of the next regular meeting of
the Board.
2.08 CONDUCT OF MEETINGS
At every meeting of the Board of Directors, the Chairman of
the Board, if there is such an officer, and if not, the
President, or in the President's absence, a Vice President
designated by the President, or in the absence of such
designation, a Chairman chosen by a majority of the
Directors present, shall preside. The Secretary of the
Corporation shall act as Secretary of the Board of
Directors' meetings. When the Secretary is absent from any
meeting, the Chairman may appoint any person to act as
Secretary of that meeting.
2.09 POWERS OF THE BOARD OF DIRECTORS
The business and affairs of the Corporation and all
corporate powers shall be exercised by or under authority of
the Board of Directors, subject to limitations imposed by
law, the Articles of Incorporation, any applicable
Shareholders' agreement, and these Bylaws.
2.10 BOARD COMMITTEESBAUTHORITY TO APPOINT
The Board of Directors may designate an executive committee
and one or more other committees to conduct the business and
affairs of the Corporation to the extent authorized. The
Board shall have the power at any time to change the powers
and membership of, fill vacancies in, and dissolve any
committee. Members of any committee shall receive such
compensation as the Board of Directors may from time to time
provide. The designation of any committee and the delegation
of authority thereto shall not operate to relieve the Board
of Directors, or any member thereof, of any responsibility
imposed by law.
2.11 TRANSACTIONS WITH INTERESTED DIRECTORS
Any contract or other transaction between the Corporation
and any of its Directors (or any corporation or firm in
which any of its Directors are directly or indirectly
interested) shall be valid for all purposes notwithstanding
the presence of that Director at the meeting during which
the contract or transaction was authorized, and
notwithstanding the Directors' participation in that
meeting. This section shall apply only if the contract or
transaction is just and reasonable to the Corporation at the
time it is authorized and ratified, the interest of each
Director is known or disclosed to the Board of Directors,
and the Board nevertheless authorizes or ratifies the
contract or transaction by a majority of the disinterested
Directors present. Each interested Director is to be counted
in determining whether a quorum is present, but shall not
vote and shall not be counted in calculating the majority
necessary to carry the vote. This section shall not be
construed to invalidate contracts or transactions that would
be valid in its absence.
2.12 NUMBER OF DIRECTORS
The number of Directors of this Corporation shall be no more
than five (5) or less than one (1). No Director need be a
resident of Nevada or a Shareholder. The number of Directors
may be increased or decreased from time to time by amendment
to these Bylaws. Any decrease in the number of Directors
shall not have the effect of shortening the tenure, which
any incumbent Director would otherwise enjoy.
2.13 TERM OF OFFICE
Directors shall be entitled to hold office until their
successors are elected and qualified. Election for all
Director positions, vacant or not vacant, shall occur at
each annual meeting of the Shareholders and may be held at
any special meeting of Shareholders called specifically for
that purpose.
2.14 REMOVAL OF DIRECTORS
The entire Board of Directors or any individual Director may
be removed from office by a vote of Shareholders holding a
majority of the outstanding shares entitled to vote at an
election of Directors. However, if less than the entire
Board is to be removed, no one of the Directors may be
removed if the votes cast against his removal would be
sufficient to elect him if then cumulatively voted at an
election of the entire Board of Directors. No director may
be so removed except at an election of the class of
Directors of which he is a part. If any or all Directors are
so removed, new Directors may be elected at the same
meeting. Whenever a class or series of shares is entitled to
elect one or more Directors under authority granted by the
Articles of Incorporation, the provisions of this Paragraph
apply to the vote of that class or series and not to the
vote of the outstanding shares as a whole.
2.15 VACANCIES
Vacancies on the Board of Directors shall exist upon the
occurrence of any of the following events: (a) the death,
resignation, or removal of any Director; (b) an increase in
the authorized number of Directors; or (c) the failure of
the Shareholders to elect the full authorized number of
Directors to be voted for at any annual, regular, or special
Shareholders' meeting at which any Director is to be
elected.
2.15(a) DECLARATION OF VACANCY
A majority of the Board of Directors may declare vacant the
office of a Director if the Director: (a) is adjudged
incompetent by a court order; (b) is convicted of a crime
involving moral turpitude; (c) or fails to accept the office
of Director, in writing or by attending a meeting of the
Board of Directors, within thirty (30) days of notice of
election.
2.15(b) FILLING VACANCIES BY DIRECTORS
Vacancies other than those caused by an increase in the
number of Directors may be filled temporarily by majority
vote of the remaining Directors, though less than a quorum,
or by a sole remaining Director. Each Director so elected
shall hold office until a qualified successor is elected at
a Shareholders' meeting.
2.15(c) FILLING VACANCIES BY SHAREHOLDERS
Any vacancy on the Board of Directors, including those
caused by an increase in the number of Directors shall be
filled by the Shareholders at the next annual meeting or at
a special meeting called for that purpose. Upon the
resignation of a Director tendered to take effect at a
future time, the Board or the Shareholders may elect a
successor to take office when the resignation becomes
effective.
2.16 COMPENSATION
Directors shall receive such compensation for their services
as Directors as shall be determined from time to time by
resolution of the Board. Any Director may serve the
Corporation in any other capacity as an officer, agent,
employee, or otherwise, and receive compensation therefor.
2.17 INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Board of Directors shall authorize the Corporation to
pay or reimburse any present or former Director or officer
of the Corporation any costs or expenses actually and
necessarily incurred by that officer in any action, suit, or
proceeding to which the officer is made a party by reason of
holding that position, provided, however, that no officer
shall receive such indemnification if finally adjudicated
therein to be liable for negligence or misconduct in office.
This indemnification shall extend to good-faith expenditures
incurred in anticipation of threatened or proposed
litigation. The Board of Directors may in proper cases,
extend the indemnification to cover the good-faith
settlement of any such action, suit, or proceeding, whether
formally instituted or not.
2.18 INSURING DIRECTORS, OFFICERS, AND EMPLOYEES
The Corporation may purchase and maintain insurance on
behalf of any Director, officer, employee, or agent of the
Corporation, or on behalf of any person serving at the
request of the Corporation as a Director, officer, employee,
or agent of another corporation, partnership, joint venture,
trust, or other enterprise, against any liability asserted
against that person and incurred by that person in any such
corporation, whether or not the Corporation has the power to
indemnify that person against liability for any of those
acts.
ARTICLE THREE - SHAREHOLDERS' MEETINGS
3.01 ACTION WITHOUT MEETING
Any action that may be taken at a meeting of the
Shareholders under any provision of the Nevada Business
Corporation Act may be taken without a meeting if authorized
by a consent or waiver filed with the Secretary of the
Corporation and signed by all persons who would be entitled
to vote on that action at a Shareholders' meeting. Each such
signed consent or waiver, or a true copy thereof, shall be
placed in the Corporate Record Book.
3.02 TELEPHONE MEETINGS
Subject to the notice provisions required by these Bylaws
and by the Business Corporation Act, Shareholders may
participate in and hold a meeting by means of conference
call or similar communication by which all persons
participating can hear each other. Participation in such a
meeting shall constitute presence in person at such meeting,
except participation for the express purpose of objecting to
the transaction of any business on the ground that the
meeting is not lawfully called or convened.
3.03 PLACE OF MEETINGS
Shareholders' meetings shall be held at the business office
of the Corporation, or at such other place within or without
the State of Nevada as may be designated by the Board of
Directors or the Shareholders.
3.04 NOTICE OF MEETINGS
The President, the Secretary, or the officer or persons
calling a Shareholders' Meeting. shall give notice, or cause
it to be given, in writing to each Director and to each
Shareholder entitled to vote at the meeting at least ten
(10) but not more than sixty (60) days before the date of
the meeting. Such notice shall state the place, day, and
hour of the meeting, and, in case of a special meeting, the
purpose or purposes for which the meeting is called. Such
written notice may be given personally, by mail, or by other
means. Such notice shall be addressed to each recipient at
such address as appears on the Books of the Corporation or
as the recipient has given to the Corporation for the
purpose of notice. Meetings provided for in these Bylaws
shall not be invalid for lack of notice if all persons
entitled to notice consent to the meeting in writing or are
present at the meeting in person or by proxy and do not
object to the notice given, Consent may be given either
before or after the meeting. Notice of the reconvening of an
adjourned meeting is not necessary unless the meeting is
adjourned more than thirty days past the date stated in the
notice, in which case notice of the adjourned meeting shall
be given as in the case of any special meeting. Notice may
be waived by written waivers signed either before or after
the meeting by all persons entitled to the notice.
3.05 VOTING LIST
At least ten (10), but not more than sixty (60), days before
each Shareholders' meeting, the officer or agent having
charge of the Corporation's share transfer books shall make
a complete list of the Shareholders entitled to vote at that
meeting or any adjournment thereof, arranged in alphabetical
order, with the address and the number of shares held by
each. The list shall be kept on file at the Registered
Office of the Corporation for at least ten (10) days prior
to the meeting, and shall be subject to inspection by any
Director, officer, or Shareholder at any time during usual
business hours. The list shall also be produced and kept
open at the time and place of the meeting and shall be
subject, during the whole time of the meeting, to the
inspection of any Shareholder. The original share transfer
books shall be prima facie evidence as to the Shareholders
entitled to examine such list or transfer books or to vote
at any meeting of Shareholders. However, failure to prepare
and to make the list available in the manner provided above
shall not affect the validity of any action taken at the
meeting.
3.06 VOTES PER SHARE
Each outstanding share, regardless of class, shall be
entitled to one (1) vote on each matter submitted to a vote
at a meeting of Shareholders, except to the extent that the
voting rights of the shares of any class or classes are
limited or denied pursuant to the Articles of Incorporation.
A Shareholder may vote in person or by proxy executed in
writing by the Shareholder, or by the Shareholder's duly
authorized attorney-in-fact.
3.07 CUMULATIVE VOTING
Subject to any limitation stated in the Articles of
Incorporation, every Shareholder entitled to vote at any
election of Directors may cumulate votes. For this purpose,
each Shareholder shall have a number of votes equal to the
number of Directors to be elected multiplied by the number
of votes to which the Shareholder's shares are entitled. The
Shareholder may cast all these votes for one candidate or
may distribute the votes among any number of candidates. The
candidates receiving the highest number of votes are
elected, up to the number of vacancies to be filled. No
Shareholder may cumulate votes unless that Shareholder gives
written notice of his or her intention to do so to the
Secretary of the Corporation on or before the day preceding
the election at which the votes will be cumulated. If any
Shareholder gives written notice as provided above, all
Shareholders may cumulate their votes.
3.08 PROXIES
A Shareholder may vote either in person or by proxy executed
in writing by the Shareholder or his or her duly authorized
attorney in fact. Unless otherwise provided in the proxy or
by law, each proxy shall be revocable and shall not be valid
after eleven (11) months from the date of its execution,
3.09 QUORUM
3.09(a) QUORUM OF SHAREHOLDERS
As to each item of business to be voted on, the presence (in
person or by proxy) of the persons who are entitled to vote
a majority of the outstanding voting shares on that matter
shall constitute the quorum necessary for the consideration
of the matter at a Shareholders' meeting. The vote of the
holders of a majority of the shares entitled to vote on the
matter and represented at a meeting at which a quorum is
present shall be the act of the Shareholders' meeting.
3.09(b) ADJOURNMENT FOR LACK OR LOSS OF QUORUM
No business may be transacted in the absence of a quorum, or
upon the withdrawal of enough Shareholders to leave less
than a quorum; other than to adjourn the meeting from time
to time by the vote of a majority of the shares represented
at the meeting.
3.10 VOTING BY VOICE OR BALLOT
Elections for Directors need not be by ballot unless a
Shareholder demands election by ballot before the voting
begins.
3.11 CONDUCT OF MEETINGS
Meetings of the Shareholders shall be chaired by the
President, or, in the President's absence, a Vice President
designated by the President, or, in the absence of such
designation, any other person chosen by a majority of the
Shareholders of the Corporation present in person or by
proxy and entitled to vote. The Secretary of the
Corporation, or, in the Secretary's absence, an Assistant
Secretary, shall act as Secretary of all meetings of the
Shareholders. In the absence of the Secretary or Assistant
Secretary, the Chairman shall appoint another person to act
as Secretary of the meeting.
3.12 ANNUAL MEETINGS
The time, place, and date of the annual meeting of the
Shareholders of the Corporation, for the purpose of electing
Directors and for the transaction of any other business as
may come before the meeting, shall be set from time to time
by a majority vote of the Board of Directors. If the day
fixed for the annual meeting shall be on a legal holiday in
the State of Nevada, such meeting shall be held on the next
succeeding business day. If the election of Directors is not
held on the day thus designated for any annual meeting, or
at any adjournment thereof, the Board of Directors shall
cause the election to be held at a special meeting of the
Shareholders as soon thereafter as possible.
3.13 FAILURE TO HOLD ANNUAL MEETING
If, within any 13-month period, an annual Shareholders'
Meeting is not held, any Shareholder may apply to a court of
competent jurisdiction in the county in which the principal
office of the Corporation is located for a summary order
that an annual meeting be held.
3.14 SPECIAL MEETINGS
A special Shareholders' meeting may be called at any time
by. (a) the President; (b) the Board of Directors; or (c)
one or more Shareholders holding in the aggregate one-tenth
or more of all the shares entitled to vote at the meeting.
Such meeting may be called for any purpose. The party
calling the meeting may do so only by written request sent
by registered mail or delivered in person to the President
or Secretary. The officer receiving the written request
shall within ten (10) days from the date of its receipt
cause notice of the meeting to be sent to all the
Shareholders entitled to vote at such a meeting. If the
officer does not give notice of the meeting within ten (10)
days after the date of receipt of the written request, the
person or persons calling the meeting may fix the time of
the meeting and give the notice. The notice shall be sent
pursuant to Section 3.04 of these Bylaws. The notice of a
special Shareholders' meeting must state the purpose or
purposes of the meeting and, absent consent of every
Shareholder to the specific action taken, shall be limited
to purposes plainly stated in the notice, notwithstanding
other provisions herein.
ARTICLE FOUR - OFFICERS
4.01 TITLE AND APPOINTMENT
The officers of the Corporation shall be a President and a
Secretary, as required by law. The Corporation may also
have, at the discretion of the Board of Directors, a
Chairman of the Board, one or more Vice Presidents, a
Treasurer, one or more Assistant Secretaries, and one or
more Assistant Treasurers. One person may hold any two or
more offices, including President and Secretary. All
officers shall be elected by and hold office at the pleasure
of the Board of Directors, which shall fix the compensation
and tenure of all officers.
4.01(a) CHAIRMAN OF THE BOARD
The Chairman, if there shall be such an officer, shall, if
present, preside at the meetings of the Board of Directors
and exercise and perform such other powers and duties as may
from time to time be assigned to the Chairman by the Board
of Directors or prescribed by these Bylaws.
4.01(b) PRESIDENT
Subject to such supervisory powers, if any, as may be given to
the Chairman, if there is one, by the Board of Directors, the
President shall be the chief executive officer of the Corporation
and shall, subject to the control of the Board of Directors, have
general supervision, direction, and control of the business and
officers of the Corporation. The President shall have the general
powers and duties of management usually vested in the office of
President of a corporation; shall have such other powers and
duties as may be prescribed by the Board of Directors or the
Bylaws; and shall be ex officio a member of all standing
committees, including the executive committee, if any. In
addition, the President shall preside at all meetings of the
Shareholders and in the absence of the Chairman, or if there is
no Chairman, at all meetings of the Board of Directors.
4.01(c) VICE PRESIDENT
Any Vice President shall have such powers and perform such duties
as from time to time may be prescribed by these Bylaws, by the
Board of Directors, or by the President. In the absence or
disability of the President, the senior or duly appointed Vice
President, if any, shall perform all the duties of the President,
pending action by the Board of Directors when so acting, such
Vice President shall have all the powers of, and be subject to
all the restrictions on, the President.
4.01(d) SECRETARY
The Secretary shall:
A. See that all notices are duly given in accordance with the
provisions of these Bylaws and as required by law. In case of the
absence or disability of the Secretary. or the Secretary's
refusal or neglect to act, notice may be given and served by an
Assistant Secretary or by the Chairman, the President, any Vice
President, or by the Board of Directors.
B. Keep the minutes of corporate meetings, and the Corporate
Record Book, as set out in Section 7.01 hereof.
C. Maintain, in the Corporate Record Book, a record of all
share certificates issued or canceled and all shares of the
Corporation canceled or transferred.
D. Be custodian of the Corporation's records and of any seal,
which the Corporation may from time to time adopt. when the
Corporation exercises its right to use a seal, the Secretary
shall see that the seal is embossed on all share certificates
prior to their issuance and on all documents authorized to be
executed under seal in accordance with the provisions of these
Bylaws.
E. In general, perform all duties incident to the office of
Secretary, and such other duties as from time to time may be
required by Sections 7.01, 7.02, and 7.03 of these Bylaws, by
these Bylaws generally, by the Board of Directors, or by the
President.
4.01(e) TREASURER
The Treasurer shall:
F. Have charge and custody of, and be responsible for, all
funds and securities of the Corporation, and deposit all funds in
the name of the Corporation in those banks, trust companies, or
other depositories that shall be selected by the Board of
Directors.
G. Receive, and give receipt for, monies due and payable to the
Corporation.
H. Disburse or cause to be disbursed the funds of the
Corporation as may be directed by the Board of Directors, taking
proper vouchers for those disbursements.
I. If required by the Board of Directors or the President, give
to the Corporation a bond to assure the faithful performance of
the duties of the Treasurer's office and the restoration to the
Corporation of all corporate books, papers, vouchers, money, and
other property of whatever kind in the Treasurer's possession or
control, in case of the Treasurer's death, resignation,
retirement, or removal from office. Any such bond shall be in a
sum satisfactory to the Board of Directors, with one or more
sureties or a surety company satisfactory to the Board of
Directors.
J. In general, perform all the duties incident to the office of
Treasurer and such other duties as from time to time may be
assigned to the Treasurer by Sections 7.O4 and 7.05 of these
Bylaws, by these Bylaws generally, by the Board of Directors, or
by the President.
4.01(f) ASSISTANT SECRETARY AND ASSISTANT TREASURER
The Assistant Secretary or Assistant Treasurer shall have such
powers and perform such duties as the Secretary or Treasurer,
respectively, or as the Board of Directors or President may
prescribe. In case of the absence of the Secretary or Treasurer,
the senior Assistant Secretary or Assistant Treasurer,
respectively, may perform all of the functions of the Secretary
or Treasurer.
4.02 REMOVAL AND RESIGNATION
Any officer may be removed, either with or without cause, by vote
of a majority of the Directors at any regular or special meeting
of the Board, or, except in case of an officer chosen by the
Board of Directors, by any committee or officer upon whom that
power of removal may be conferred by the Board of Directors. Such
removal shall be without prejudice to the contract rights, if
any, of the person removed. Any officer may resign at any time by
giving written notice to the Board of Directors, the President,
or the Secretary of the Corporation. Any resignation shall take
effect on the date of the receipt of that notice or at any later
time specified therein, and, unless otherwise specified therein,
the acceptance of that resignation shall not be necessary to make
it effective.
4.03 VACANCIES
Upon the occasion of any vacancy occurring in any office of the
Corporation, by reason of death, resignation, removal, or
otherwise, the Board of Directors may elect an acting successor
to hold office for the unexpired term or until a permanent
successor is elected.
4.04 COMPENSATION
The compensation of the officers shall be fixed from time to time
by the Board of Directors, and no officer shall be prevented from
receiving a salary by reason of the fact that the officer is also
a Shareholder or a Director of the Corporation, or both.
ARTICLE FIVEBAUTHORITY TO EXECUTE INSTRUMENTS
5.01 NO AUTHORITY ABSENT SPECIFIC AUTHORIZATION
These Bylaws provide certain authority for the execution of
instruments. The Board of Directors, except as otherwise provided
in these Bylaws, may additionally authorize any officer or
officers, agent or agents, to enter into any contract or execute
and deliver any instrument in the name of and on behalf of the
Corporation, and such authority may be general or confined to
specific instances. Unless expressly authorized by these Bylaws
or the Board of Directors, no officer, agent, or employee shall
have any power or authority to bind the Corporation by any
contract or engagement nor to pledge its credit nor to render it
peculiarly liable for any purpose or in any amount.
5.02 EXECUTION OF CERTAIN INSTRUMENTS
Formal contracts of the Corporation, promissory notes, deeds,
deeds of trust, mortgages, pledges, and other evidences of
indebtedness of the Corporation, other corporate documents, and
certificates of ownership of liquid assets held by the
Corporation shall be signed or endorsed by the President or any
Vice President and by the Secretary or the Treasurer, unless
otherwise specifically determined by the Board of Directors or
otherwise required by law.
ARTICLE SIX-ISSUANCE AND TRANSFER OF SHARES
6.01 CLASSES AND SERIES OF SHARES
The Corporation may issue one or more classes or series of
shares, or both. Any of these classes or series may have full,
limited, or no voting rights, and may have such other
preferences, rights, privileges, and restrictions as are stated
or authorized in the Articles of Incorporation. All shares of any
one class shall have the same voting, conversion, redemption, and
other rights, preferences, privileges, and restrictions, unless
the class is divided into series, If a class is divided into
series, all the shares of any one series shall have the same
voting, conversion, redemption, and other. rights, preferences,
privileges, and restrictions. There shall always be a class or
series of shares outstanding that has complete voting rights
except as limited or restricted by voting rights conferred on
some other class or series of outstanding shares.
6.02 CERTIFICATES FOR FULLY PAID SHARES
Neither shares nor certificates representing shares may be issued
by the Corporation until the full amount of the consideration has
been received when the consideration has been paid to the
Corporation, the shares shall be deemed to have been issued and
the certificate representing the shares shall be issued to the
shareholder.
6.03 CONSIDERATION FOR SHARES
Shares may be issued for such consideration as may be fixed from
time to time by the Board of Directors, but not less than the par
value stated in the Articles of Incorporation. The consideration
paid for the issuance of shares shall consist of money paid,
labor done, or property actually received, and neither promissory
notes nor the promise of future services shall constitute payment
nor partial payment for shares of the Corporation.
6.04 REPLACEMENT OF CERTIFICATES
No replacement share certificate shall be issued until the former
certificate for the shares represented thereby shall have been
surrendered and canceled, except that replacements for lost or
destroyed certificates may be issued, upon such terms,
conditions, and guarantees as the Board may see fit to impose,
including the filing of sufficient indemnity.
6.05 SIGNING CERTIFICATES-FACSIMILE SIGNATURES
All share certificates shall be signed by the officer(s)
designated by the Board of Directors. The signatures of the
foregoing officers may be facsimiles. If the officer who has
signed or whose facsimile signature has been placed on the
certificate has ceased to be such officer before the certificate
issued, the certificate may be issued by the Corporation with the
same effect as if he or she were such officer on the date of its
issuance.
6.06 TRANSFER AGENTS AND REGISTRARS
The Board of Directors may appoint one or more transfer agents or
transfer clerks, and one or more registrars, at such times and
places as the requirements of the Corporation may necessitate and
the Board of Directors may designate. Each registrar appointed,
if any, shall be an incorporated bank or trust company, either
domestic or foreign.
6.07 CONDITIONS OF TRANSFER
The party in whose name shares of stock stand on the books of the
Corporation shall be deemed the owner thereof as regards the
Corporation, provided that whenever any transfer of shares shall
be made for collateral security, and not absolutely, and prior
written notice thereof shall be given to the Secretary of the
Corporation, or to its transfer agent, if any, such fact shall be
stated in the entry of the transfer.
6.08 REASONABLE DOUBTS AS TO RIGHT TO TRANSFER
When a transfer of shares is requested and there is reasonable
doubt as to the right of the person seeking the transfer, the
Corporation or its transfer agent, before recording the transfer
of the shares on its books or issuing any certificate therefor,
may require from the person seeking the transfer reasonable proof
of that person's right to the transfer. If there remains a
reasonable doubt of the right to the transfer, the Corporation
may refuse a transfer unless the person gives adequate security
or a bond of indemnity executed by a corporate surety or by two
individual sureties satisfactory to the Corporation as to form,
amount, and responsibility of sureties. The bond shall be
conditioned to protect the Corporation, its officers, transfer
agents, and registrars, or any of them, against any loss, damage,
expense, or other liability for the transfer or the issuance of a
new certificate for shares.
ARTICLE SEVENBCORPORATE RECORDS AND ADMINISTRATION
7.01 MINUTES OF CORPORATE MEETINGS
The Corporation shall keep at the principal office, or such other
place as the Board of Directors may order, a book recording the
minutes of all meetings of its Shareholders and Directors, with
the time and place of each meeting, whether such meeting was
regular or special, a copy of the notice given of such meeting,
or of the written waiver thereof, and, if it is a special
meeting, how the meeting was authorized. The record book shall
further show the number of shares present or represented at
Shareholders' meetings, and the names of those present and the
proceedings of all meetings.
7.02 SHARE REGISTER
The Corporation shall keep at the principal office, or at the
office of the transfer agent, a share register showing the names
of the Shareholders, their addresses, the number and class of
shares issued to each, the number and date of issuance of each
certificate issued for such shares, and the number and date of
cancellation of every certificate surrendered for cancellation.
The above information may be kept on an information storage
device such as a computer, provided that the device is capable of
reproducing the information in clearly legible form. If the
Corporation is taxed under Internal Revenue Code Section 1244 or
Subchapter S, the Officer issuing shares shall maintain the
appropriate requirements regarding issuance.
7.03 CORPORATE SEAL
The Board of Directors may at any time adopt, prescribe the use
of, or discontinue the use of, such corporate seal as it deems
desirable, and the appropriate officers shall cause such seal to
be affixed to such certificates and documents as the Board of
Directors may direct.
7.04 BOOKS OF ACCOUNT
The Corporation shall maintain correct and adequate accounts
of its properties and business transactions, including
accounts of its assets, liabilities, receipts, disbursements,
gains, losses, capital, surplus, and shares. The corporate
bookkeeping procedures shall conform to accepted accounting
practices for the Corporation's business or businesses.
subject to the foregoing, The chart of financial accounts
shall be taken from, and designed to facilitate preparation
of, current corporate tax returns. Any surplus, including
earned surplus, paid-in surplus, and surplus arising from a
reduction of stated capital, shall be classed by source and
shown in a separate account. If the Corporation is taxed
under Internal Revenue Code Section 1244 or Subchapter S, the
officers and agents maintaining the books of account shall
maintain the appropriate requirements.
7.05 INSPECTION OF CORPORATE RECORDS
A Director or Shareholder demanding to examine the
Corporation's books or records may be required to first sign
an affidavit that the demanding party will not directly or
indirectly participate in reselling the information and will
keep it confidential other than in use for proper purposes
reasonably related to the Director's or Shareholder's role. A
Director who insists on examining the records while refusing
to sign this affidavit thereby resigns as a Director.
7.06 FISCAL YEAR
The fiscal year of the Corporation shall be as determined by
the Board of Directors and approved by the Internal Revenue
Service. The Treasurer shall forthwith arrange a consultation
with the Corporation's tax advisers to determine whether the
Corporation is to have a fiscal year other than the calendar
year. If so, the Treasurer shall file an election with the
Internal Revenue Service as early as possible, and all
correspondence with the IRS, including the application for
the Corporation's Employer Identification Number, shall
reflect such non-calendar year election.
7.07 WAIVER OF NOTICE
Any notice required by law or by these Bylaws may be waived
by execution of a written waiver of notice executed by the
person entitled to the notice. The waiver may be signed
before or after the meeting.
ARTICLE EIGHT- ADOPTION OF INITIAL BYLAWS
The Board of Directors adopted the foregoing bylaws on
October 6, 1999.
/S/ J.P. Beehner
Director
/S/ Dorothy A. Mortenson
Director
Attested to, and certified by: /S/ Dorothy A. Mortenson,
Secretary
EXHIBIT 5.1
OPINION AS TO LEGALITY
ARTHUR J. FROST, LTD.
Arthur J. Frost, Esq.
7549 W. Heatherbrae Drive
Phoenix, Arizona 85033
(623) 849-2050
(623) 873-1799 Facsimile
June 22, 2000
Paragon Polaris Strategies.com Inc.
404 Scott Point Drive
Salt Spring Island, BC V8K 2R2
Canada
Re: Paragon Polaris Strategies.com Inc. Registration
Statement on Form SB2/A
Ladies and Gentlemen:
We have acted as counsel for Paragon Polaris Strategies.com
Inc., a Nevada corporation (the Company), in connection with
the preparation of the Registration Statement on Form SB2 (the
Registration Statement) file with the Securities and Exchange
Commission (the Commission) pursuant to the Securities Act of
1933 (the Act), relating to the public offering (the Offering)
or up to one million (1,000,000) shares (the Shares) of; the
Companys common stock, $0.001 par value (the Common Stock) by
the issuer through the means of a self-underwriting. This
opinion is being furnished pursuant to Item 601(b)(5) of
Regulation K under the Act.
In rendering the opinions set forth below, we have reviewed
(a) the Registration Statement and exhibits thereto; (b) the
Companys Articles of Incorporation; (c) the Companys Bylaws;
(d) certain records of the Companys corporate proceedings as
reflected in its minute books; and (e) such statutes, records and
other documents as we have deemed relevant. In our examination,
we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and
conformity with the originals of all documents submitted to us as
copies thereof. In addition, we have made other examinations of
law and fact as we have deemed relevant in order to form a basis
for the opinion hereinafter expressed.
Based on the foregoing, we are of the opinion that those
shares of the selling shareholders are validly issued, fully paid
and non-assessable.
We are also of the opinion that if and when the Registration
Statement should become effective, all shares sold to the public
through the use of the Registration Statement and the Prospectus
contained therein, will be validly issued, fully paid and non-
assessable.
We hereby consent to the use of this opinion as an Exhibit
to the Registration Statement and to all references to this Firm
under the caption Interests of Named Experts and Counsel in the
Registration Statement.
Very Truly Yours,
Arthur J. Frost Ltd.
/S/ Arthur J. Frost
Arthur J. Frost
EXHIBIT 10.1
LICENSE AGREEMENT
BETWEEN
VITAMINERALHERB.COM INC.
AND
DAVID R. MORTENSON AND ASSOCIATES
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT ("Agreement") is made and effective as of
June 10, 1999 by and between Vitamineralherb.Com Inc., a Nevada
Corporation ("Vita") and David R. Mortenson & Associates, a Texas
general partnership (ADRM@), with reference to the following facts:
A. Vita is in the business of Internet marketing of private labeled
vitamin, mineral and/or nutritional supplement products as well
as other health and fitness (the Products) to health
practitioners and fitness practitioners.
B. Vita desires to increase its marketing exposure to health
practitioners and fitness practitioners.
3. DRM desires to market the Products to various health and fitness
practitioners in territories in which Vita does not currently market.
The parties agree that DRM may expand the marketing of the Products by
entering into sub-distribution agreements with other entities (the
Sub-licensees).
NOW THEREFORE, for $10.00 and in consideration of the mutual promises,
warranties and covenants herein contained, the parties hereby agree as
follows:
1. Scope of Agreement. This Agreement shall govern all Products sold
through Vitas web site to any customer of DRM or of Sub-licensee(s)
(Customer(s)). Exhibit A contains detailed information regarding
specifications, quality control, pricing and other terms relating to
the first Product(s) to be ordered through Vitas web site. The
parties agree that Exhibit A will be amended to include similar
information with respect to any future orders of the same product or
any new Product ordered through Vita by DRM or by Sub-licensee(s) or
Customers. IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THIS
AGREEMENT AND ANY PURCHASE ORDER SUBMITTED BY CUSTOMER, THE TERMS OF
THIS AGREEMENT WILL CONTROL.
2. Manufacture of Products. Vitamin, mineral and/or nutritional
supplement Products marketed through Vitas web site shall be products
manufactured by FDA approved manufacturers which shall manufacture,
package and prepare the Products for shipment in accordance with the
specifications and requirements described on Exhibit A hereto as it
may be modified from time to time. Quality control standards relating
to the Product's weight, color, consistency, micro-biological content,
labeling and packaging are also set forth on Exhibit A. In the event
that Exhibit A is incomplete, Products shall be manufactured and
shipped in accordance with industry standards.
3. Labeling; Packaging; Shipping. DRMs or Sub-licensees customers
shall use standard labels as specified by Vita. Vita agrees to insert
each customer=s name and address on the standard labels in return for
handling charges which shall be specified from time to time. Vita
warrants that the standard labels shall contain all information
necessary to conform to industry requirements.
4. Products and Pricing. The pricing for the Product(s) is set forth
on Exhibit A and may be amended from time to time. Terms are payment
by credit card or electronic funds transfer at time of purchase.
Unless otherwise specified on Exhibit A, the lead time from receipt of
payment to delivery is 4-6 weeks.
5. Minimum Purchases for Vitamin, Mineral, and/or Nutritional
Supplements. The minimum purchase order quantity is 100 bottles per
formulation for standard Products. Customer Formulas, as defined
herein, shall have minimum purchase quantities of 5,000 units unless
and until such Customer Formula shall have been added to the standard
Products.
6. Web Site Maintenance; Fees. Vita agrees to maintain a web site
(the AWeb Site@) for sales of Product by DRM or its Sub-licensee(s).
DRM agrees that all sales of Product made by DRM or its Sub-licensees
will be accomplished through the Web Site. DRM further agrees that
DRM shall pay to Vita a maintenance fee of $500 yearly, beginning on
the anniversary date of this Agreement, for maintenance of the Web
site. DRM further agrees that the Sub-licensees shall each be
obligated to pay $500 yearly to Vita, on the anniversary date(s) of
the agreement(s) between Sub-licensee(s) and DRM, for maintenance of
the Web Site.
7. Rights in Formulas.
(a) Customer Formulas. Any formula provided exclusively by DRMs
or Sub-licensees Customer shall be owned by Customer
("Customer Formula"), provided that such Customer Formula
does not substantially duplicate an existing Vita formula.
Vita agrees not to sell products to other customers using
any Customer Formula during the period in which Customer is
ordering products containing the formula and for so long as
Customer continues to purchase products containing the
Customer Formula.
(c) Joint Formulas. If Vita and Customer jointly create a
formula ("Joint Formula"), such Joint Formula will be
jointly owned by the parties. Vita agrees not to sell
products to other customers using the Joint Formula during
the period in which Customer is ordering products containing
the Joint Formula from Vita without written permission from
Customer. In the event that Customer fails to order a
specific Joint Formula Product for a period of 3 months,
Vita shall be free to sell products containing the Joint
Formula to other customers.
8. Term of Agreement; Breach of Agreement. This Agreement shall
continue for three (3) years, and shall be automatically renewed
unless one of the parties provides ninety (90) days written notice of
termination to the other party. In the event of a material breach of
this Agreement, the non-breaching party may provide written notice of
termination which shall be effective upon receipt. In the event of
termination by DRM or Sub-licensee prior to delivery of Product for
which a purchase order has been submitted, the terminating party shall
reimburse Vita for the cost of all Product and return of any boxes and
labels. In no event shall reimbursement of these amounts limit Vitas
legal right to seek compensation for the amount of its profit or any
other damages accrued under any canceled purchase order. In no event
shall Vita be required to accept or deliver product under any purchase
order if Vita has not received the outstanding balance due on any
previous purchase order in a timely manner. Failure to so perform
shall not be deemed a breach of this Agreement by Vita.
9. Override; Payment to DRM. All purchases shall be made through
the Web Site, and payments shall be made by credit card or other
approved methods such as electronic funds transfer or debit card. DRM
agrees that Vita shall retain a 10% override on all sales made through
the Web Site by DRM or Sub-licensee(s). Vita agrees to pay supplier
for the Product purchased, retain Vita=s override, and remit the
balance to DRM or Sub-licensee. Vita further agrees to provide DRM
with a Monthly Sales Report of all sales made by DRM through the Web
Site. After DRM has notified Vita of any grant of Sub-license to a
territory, Vita will provide Sub-licensee(s) with a Monthly Sales
Report of all sales made by Sub-licensee(s) in Sub-licensee(s)
territory. Vita will deliver the printed breakdown by the tenth day
of the month following such sales.
10. Trade Secrets. Vita and DRM and Sub-licensee(s) are the owners of
certain products, technology, information, customer lists, services,
processes, financial information, pending or prospective
transactions/proposals, operating and marketing plans and procedures,
designs, product formulas, specifications, manufacturing methods,
ideas, prototypes, software, patent, trademark and copyright
applications or registrations and other similar data relating to each
party's business which data is not publicly known and derives economic
value from not being publicly known (collectively "Trade Secrets").
Each party agrees that it will not use or disclose to third parties
any Trade Secret it receives from the other, except as may be
contemplated by this Agreement. Each party agrees that it will take
all reasonable precautions to assure that no Trade Secret is conveyed
to any officer, employee, agent, manufacturer or other third party who
does not have a need to know such Trade Secret. The obligations
created by this Section 10 shall survive the termination of this
Agreement or any business relationship between the parties. Any Trade
Secret contained in any writing will be returned to the other party
promptly upon written request, together with any reproductions
thereof.
11. Governing Law; Dispute Resolution. This Agreement shall be
governed by and construed in accordance with the laws of the State of
Texas. Any dispute arising under this Agreement shall be resolved
pursuant to the terms of the Dispute Resolution Agreement attached
hereto as Exhibit B.
12. Miscellaneous Provisions. This Agreement constitutes the entire
Agreement between the parties and supersedes any prior or
contemporaneous agreements, oral or written. This Agreement may only
be amended by a writing signed by both parties. This Agreement may not
be assigned without the written consent of the other party; provided
that this Agreement may be assigned without consent to an entity
acquiring all or substantially all of the assets of either party. Any
notice required or permitted to be given under this Agreement shall be
in writing and sent by telecopy, personal delivery or certified mail,
return receipt requested, as follows:
If to Vitamineralherb.Com, Inc.: Mr. D. R. Mortenson, President
P. O. Box 2370
Alvin TX 77512-2370
If to David R. Mortenson & Associates: Mr. David R. Mortenson
P. O. Box 5034
Alvin TX 77512-5034
Fax: (281)388-1047
Notice shall be deemed effective upon receipt if made by
confirmed telecopy, personal delivery or 48 hours after deposit
in the United States mail with the required postage.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of
the date first above written.
VITAMINERALHERB.COM INC.
a Nevada corporation
By:
David R. Mortenson, President
DAVID R. MORTENSON & ASSOCIATES
a Texas General Partnership
By: _________________________________
David R. Mortenson, General Partner
EXHIBIT A
PRODUCT SPECIFICATIONS
In the event of any inconsistency between the terms of Customer's
purchase order and this Product Specification Sheet, this Sheet and
the terms of the Manufacturing Agreement shall control.
Short Product Name: _____________________________
Exact Product Ingredients and Percentages:
Other Product Specifications:
Color: ___________ Tablet Type: ____________
Consistency:______________
Weight: _______ Bottle Size/Color:____________ Bottle Count:
___________
Cotton Insert:____ Bottle Seal:____ Shrink Wrap Neck Band:___ Silicon
Pack:____
Micro-biological content: Customer to specify any requirements, if
none specified, product will be manufactured to industry standards.
Labels: Labels and/or boxes to be provided by Customer [identify any
size] _________
Labels/Boxes to be Received by [date] _____ to ensure timely delivery
Master Pack/Wrapping/Palleting Requirements (if
any):_________________________
Ship to Address: _________________________________________________
Order Quantity: (minimum 5,000 BOTTLES): ________
Price: _____________ FOB IFM's facility in San Diego, CA.
Delivery Dates(s): _______________________________________
Terms of Sale: 50% with submission of purchase order; 50% due upon
completion of manufacturing, unless otherwise specified
_________________________
Purchase Order Number: ________________
Date of Purchase Order: ________________
EXHIBIT B
DISPUTE RESOLUTION AGREEMENT
THIS DISPUTE RESOLUTION AGREEMENT ("Dispute Resolution
Agreement") is entered into and effective as of December 24, 1999 by
and between Vitamineralherb.com Inc., a Nevada corporation, and David
R. Mortenson & Associates, a Texas general partnership.
1. INTENT OF PARTIES. The parties desire to establish a quick, final
and binding out-of-court dispute resolution procedure to be followed
in the unlikely event any dispute arising out of or related to the
Manufacturing Agreement dated June 9, 1999 between the parties
("Agreement"). As used in this Dispute Resolution Agreement, the term
"dispute" is used in its broadest and most inclusive sense and shall
include, without limitation, any disagreement, controversy, claim, or
cause of action between the parties arising out of, related to, or
involving the Agreement or the transactions evidenced by the Agreement
(collectively "Dispute").
2. NEGOTIATION. It is the intent of the parties that any Dispute be
resolved informally and promptly through good faith negotiation
between the parties. Therefore, in the event of a Dispute between the
parties, the following will apply:
A. Correspondence. Either party may initiate negotiation
proceedings by writing a certified or registered letter,
return receipt requested, to the other party referencing
this Dispute Resolution Agreement, setting forth the
particulars of the Dispute, the term(s) of the Agreement
involved and a suggested resolution of the problem. The
recipient of the letter must respond within ten (10) days
after its receipt of the letter with an explanation and
response to the proposed solution.
B. Meeting. If correspondence does not resolve the Dispute,
then the authors of the letters or their representatives
shall meet on at least one occasion and attempt to resolve
the matter. Such meeting shall occur not later than thirty
(30) days from the parties' last correspondence. If the
parties are unable to agree on the location of such a
meeting, the meeting shall be held at IFM's corporate
offices. Should this meeting not produce a resolution of the
matter, then either party may request mandatory mediation
(as provided below) by written notice to the other party.
3. MEDIATION. Subject to the availability of the mediator, the
mediation shall occur not more than thirty (30) days after the request
for mediation. The mediation shall be conducted by retired Judge
William Yale, former Presiding Judge of the San Diego Superior Court,
who now acts as a full-time, highly respected mediator. The mediation
shall be held in San Diego, California. The cost of mediation shall be
borne equally by the parties. The mediation process shall continue
until the Dispute (or any part thereof) is resolved or until such time
as the mediator makes a finding that there is no possibility of
resolution short of referring the parties to final and binding
arbitration.
1. 4. FINAL AND BINDING ARBITRATION. Should any Dispute (or pan
thereof) remain between the parties after completion of the
negotiation and mediation process set forth above, such Dispute shall
be submitted to final and binding arbitration in San Diego,
California. The arbitration shall be governed by the provisions of the
California Code of Civil Procedure ("CCP"), and the following
provisions, which shall supersede the CCP in the event of any
inconsistency:
A. Selection of Arbitrator(s). There shall be a single
arbitrator, except in the case where the amount in dispute
exceeds $100,000, in which case there shall be three
arbitrators. If the parties cannot agree upon acceptable
arbitrators(s) within ten (10) days of the termination of
the mediation, each party shall select one arbitrator from a
list of not less than five (5) arbitrators provided by the
other party. These two arbitrators shall select a third
arbitrator who shall serve as the sole arbitrator or the
third arbitrator, as the case may be. The determination of a
majority of the arbitrators or the sole arbitrator, as the
case may be, shall be conclusive upon the parties and shall
be non-appealable.
B. Discovery. No discovery shall be permitted, absent a showing
of good cause. Any discovery request should be reviewed with
the knowledge that this dispute resolution process was
mutually agreed upon and bargained for by the parties with
the intent to provide a cost-effective and timely method of
resolving disputes. Any discovery granted by the arbitrator
should be limited to that necessary to protect the minimum
due process rights of the parties.
C. Equitable Remedies. Any party shall have the right to seek a
temporary restraining order, preliminary or permanent
injunction or writ of attachment, without waiving the
negotiation, mediation and arbitration provision hereof. In
so doing, such party shall not be required to meet the
requirement of California Civil Code Section 1281.8. Any
other form of equitable or provisional relief and all
substantive matters relating to the Dispute shall be
determined solely by the arbitrator(s).
D. Attorney's Fees; Arbitration Costs. Each party may be
represented by an attorney or other representative selected
by the party. The costs of the arbitration shall be borne
equally by the parties. Each party shall bear its own
attorneys'/representatives' fees and costs; provided that if
the arbitrator(s) find either party has acted in bad faith,
the arbitrator(s) shall have discretion to award attorneys'
fees to the other party.
E. Scope of Arbitration; Limitation on Powers of Arbitrator(s);
Applicable Law. No party may raise new claims against the
other party in the arbitration not raised in the mediation.
The arbitrator shall have the power to resolve all Disputes
between the parties. The arbitrator(s) shall not have the
power to award treble, punitive or exemplary damages and the
parties hereby waive their right to receive treble, punitive
or exemplary damages, to the extent permitted by law. The
arbitrator(s) shall only interpret and apply the terms and
provision of the Agreement and shall not change any such
terms or provisions or deprive either party of any right or
remedy expressly or impliedly provided for in the Agreement.
The arbitrator(s) shall apply the law of the State of
California (excluding California's conflict of law rules),
or federal law, in those instances in which federal law
applies.
F. Designation of Witnesses/Exhibits; Duration of Arbitration
Process; Written Decision. At least thirty (30) days before
the arbitration is scheduled to commence, the parties shall
exchange lists of witnesses and copies of all exhibits
intended to be used in arbitration. The arbitration shall be
completed within 90 days o fthe selection of the first
arbitrator. The arbitrator(s) shall render a written
decision, which contains findings of fact and conclusions of
law, within 30 days of the conclusion of the arbitration and
shall specify a time within which the award shall be
performed. Judgment upon the award may be entered in any
court of competent jurisdiction.
5. MISCELLANEOUS
A. Enforcement of Negotiation/Mediation Provisions. If a party
demanding such compliance with this Agreement obtains a
court order directing the other party to comply with this
Dispute Resolution Agreement, the party demanding compliance
shall be entitled to all of its reasonable attorneys' fees
and costs in obtaining such order, regardless of which party
ultimately prevails in the matter.
B. Severability. Should any portion of this Dispute Resolution
Agreement be found to be invalid or unenforceable such
portion will be severed from this Dispute Resolution
Agreement, and the remaining portions shall continue to be
enforceable unless to do so would materially alter the
effectiveness of this Dispute Resolution Agreement in
achieving the stated intent of the parties.
C. Confidentiality. The parties agree that they will not
disclose to any third party that (1) they are engaged in the
dispute resolution process described herein, (2) the fact
of, nature or amount of any compromise resulting herefrom,
or (3) the fact of, nature or amount of any arbitration
award. This confidentiality obligation shall not extend to
the party's employees, spouses, accountant, bankers,
attorneys or insurers or in the event that disclosure is
otherwise required by law.
D. Time to Initiate Claims. An aggrieved party must mail and the
other party must receive the correspondence which initiates
negotiation proceedings in connection with a Dispute as specified in
Paragraph 2(A) (1) within one (1) year of the date the aggrieved party
first has, or with the exercise of reasonable diligence should have
had, knowledge of the event(s) giving rise to the Dispute (the "One
Year Statute of Limitations"). No Dispute may be raised under this
Dispute Resolution Agreement after the expiration of the One Year
Statute of Limitations.
E. Entire Agreement. These dispute resolution provisions
express the entire agreement of the parties and there are no
other agreements, oral or written, concerning dispute
resolution, except as provided herein. Any ambiguity in the
provisions hereof shall not be construed against the
drafter. This Dispute Resolution Agreement may only be
modified in a writing signed by both parties.
F. Successors. This Dispute Resolution Agreement is binding
upon and inures to the benefit of the parties, their agents,
heirs, assigns, successors-in-interest, and any person, firm
or organization acting for or through them.
G. Venue and Jurisdiction. Venue and exclusive jurisdiction for
any action arising out of or related to this Dispute
Resolution Agreement (including, but not limited to,
equitable actions contemplated by Section 4 (C) and actions
brought to enforce or interpret this Dispute Resolution
Agreement) shall be in the state courts for the County of
San Diego, California or the federal court for the Southern
District of California.
H. Notice. Any notice or communication required to be given
hereunder shall be in writing and shall be mailed via the
United States Postal Service by Certified Mail or Registered
Mail, Return Receipt Requested, or by Federal Express or
other overnight courier which can document delivery, to the
address of the party to be served as shown below (or such
other address as the party shall from time to time notify).
Such notice shall be deemed to have been served at the time
when the same is received by the party being served.
Vitameneralherb.com Inc.: Vitamineralherb.Com Inc
D. R. Mortenson, President
P.O. Box 2370
Alvin TX 77512-2370
David R. Mortenson & Assoc.: David R. Mortenson, Gen.
Partner
P. O. Box 5034
Alvin, Texas 77512-5034
I. Acknowledgment of Legal Effect of this Dispute Resolution
Agreement. By signing this Dispute Resolution Agreement, the
parties acknowledge that they are giving up any rights they
may possess to have Disputes litigated in a court and are
hereby waiving the right to a trial by jury. The parties
further acknowledge that they are agreeing to a one year
statute of limitations regarding all Disputes and that they
are giving up their judicial rights to discovery and to
appeal, unless such rights are specifically set forth above.
The parties acknowledge that if they refuse to submit to the
provisions of this Dispute Resolution Agreement they may be
compelled to do so under the authority of the California
Code of Civil Procedure. The parties acknowledge that they
have had the opportunity to consult counsel regarding the
meaning and legal effect of this Dispute Resolution
Agreement and enter into it knowingly and voluntarily.
IN WITNESS WHEREOF, the parties have entered into this Dispute
Resolution Agreement as of the date first above written.
Vitamineralherb.com Inc. David R. Mortenson &
Associates
a Nevada corporation a Texas General
Partnership
By: By:
Title: President Title: General Partner
EXHIBIT 10.2
ASSIGNMENT OF LICENSE TO
PARAGON POLARIS STRATAGIES.COM INC.
LICENSE AGREEMENT
THIS LICENSE AGREEMENT ("Agreement") is made and effective as of
January 20, 2000 by and between David R. Mortenson & Associates, a
Texas general partnership (DRM), and Paragon Polaris Stratagies.com
Inc. a Nevada corporation (Licensee), with reference to the
following facts:
1. On July 1, 1999, DRM and Licensee entered into an agreement
granting Licensee certain rights for the use of DRMs oxygen-enriched
water product (the Water Rights). In consideration therefor,
Licensee issued DRM 2,000,000 shares of Licensees common stock (the
AShares@). Subsequent to the grant of the Water Rights, the underlying
contract granting DRM the rights to the technology to produce the
oxygen-enriched water came into dispute. In order to enable Licensee
to conduct a business and to preserve the value of the Shares, DRM
desires to grant additional rights to Licensee which are not in
dispute.
2. DRM is the holder of certain rights to an Internet marketing
system for vitamins, minerals, nutritional supplements, and other
health and fitness products (the Products) pursuant to an agreement
between Vitamineralherb.com Corp. (Vita), a Nevada corporation,
appended hereto as Exhibit C, which rights include the right to grant
licenses for use of the system in various territories.
3. Licensee desires to market the Products to various health and
fitness practitioners in the Territory, as hereinafter defined.
NOW THEREFORE, in consideration of the mutual promises, warranties and
covenants herein contained, the parties hereby agree as follows:
1. Scope of Agreement. This Agreement shall govern all Products sold
through Vitas web site to any of Licensees customers
(Customer(s)). Exhibit A contains detailed information regarding
specifications, quality control, pricing and other terms relating to
the first Product(s) to be ordered through Vitas web site. The
parties agree that Exhibit A will be amended to include similar
information with respect to any future orders of the same product or
any new Product ordered through Vita by DRM or by Sub-licensee(s) or
Customers. IN THE EVENT OF ANY CONFLICT BETWEEN THE TERMS OF THIS
AGREEMENT AND ANY PURCHASE ORDER SUBMITTED BY CUSTOMER, THE TERMS OF
THIS AGREEMENT WILL CONTROL.
2. Grant of License; Territory. Territory shall be the states of
Idaho and Oregon. DRM grants to Licensee the exclusive rights to
market the Products in the Territory through the Web Site.
3. Manufacture of Products. Vitamin, mineral and/or nutritional
supplement Products marketed through Vita=s web site shall be products
manufactured by FDA approved manufacturers which shall manufacture,
package and prepare the Products for shipment in accordance with the
specifications and requirements described on Exhibit A hereto as it
may be modified from time to time. Quality control standards relating
to the Product's weight, color, consistency, micro-biological content,
labeling and packaging are also set forth on Exhibit A. In the event
that Exhibit A is incomplete, Products shall be manufactured and
shipped in accordance with industry standards.
4. Labeling; Packaging; Shipping. Customers shall use standard
labels as specified by Vita. Upon request by Customer, Customer=s
name and address will be inserted on the standard labels in return for
handling charges which shall be specified from time to time. Standard
labels shall contain all information necessary to conform to industry
requirements.
5. Products and Pricing. The pricing for the Product(s) is set forth
on Exhibit A and may be amended from time to time. Terms are payment
by credit card or electronic funds transfer at time of purchase.
Unless otherwise specified on Exhibit A, the lead time from receipt of
payment to delivery is 4-6 weeks.
6. Minimum Purchases for Vitamin, Mineral, and/or Nutritional
Supplements. The minimum purchase order quantity is 100 bottles per
formulation for standard Products. Customer Formulas, as defined
herein, shall have minimum purchase quantities of 5,000 units unless
and until such Customer Formula shall have been added to the standard
Products.
7. Web Site Maintenance; Fees. Licensee agrees that all sales of
Product to Customers will be accomplished through the Vita Web Site
(the AWeb Site@). Licensee further agrees that Licensee shall pay to
Vita a maintenance fee of $500 yearly, beginning on the anniversary
date of this Agreement, for maintenance of the Web site.
8. Nature of Relationship. (a) This Agreement does not constitute
nor empower the Licensee as the agent or legal representative of the
Company for any purpose whatsoever. Licensee is and will continue to
be an independent contractor.
(b) The arrangement created by this Agreement is not, and
is not intended to be, a franchise or business opportunity under
the United States' Federal Trade Commission Rule: Disclosure
Requirements and Prohibitions Concerning Franchising and Business
Opportunity Ventures and is not a franchise, business opportunity
or seller assisted marketing plan or similar arrangement under
any other federal, state, local or foreign law, rule or
regulation.
(c) Licensee is not prohibited by this Agreement from
pursuing other business opportunities or other employment.
9. Rights in Formulas.
(a) Customer Formulas. Any formula provided exclusively by
Licensees Customer shall be owned by Customer ("Customer
Formula"), provided that such Customer Formula does not
substantially duplicate an existing Vita formula. Vita
agrees not to sell products to other customers using any
Customer Formula during the period in which Customer is
ordering products containing the formula and for so long as
Customer continues to purchase products containing the
Customer Formula.
(c) Joint Formulas. If Vita and Customer jointly create a
formula ("Joint Formula"), such Joint Formula will be
jointly owned by the parties. Vita agrees not to sell
products to other customers using the Joint Formula during
the period in which Customer is ordering products containing
the Joint Formula from Vita without written permission from
Customer. In the event that Customer fails to order a
specific Joint Formula Product for a period of 3 months,
Vita shall be free to sell products containing the Joint
Formula to other customers.
10. Term of Agreement; Breach of Agreement. This Agreement shall
continue for three (3) years, and shall be automatically renewed
unless one of the parties provides ninety (90) days written notice of
termination to the other party. In the event of a material breach of
this Agreement, the non-breaching party may provide written notice of
termination which shall be effective upon receipt. In the event of
termination by Licensee prior to delivery of Product for which a
purchase order has been submitted, Licensee shall reimburse Vita for
the cost of all Product and return of any boxes and labels. In no
event shall reimbursement of these amounts limit Vitas legal right to
seek compensation for the amount of its profit or any other damages
accrued under any canceled purchase order. In no event shall Vita be
required to accept or deliver product under any purchase order if Vita
has not received the outstanding balance due on any previous purchase
order in a timely manner. Failure to so perform shall not be deemed a
breach of this Agreement by Vita.
11. Override; Payment to Licensee. All purchases shall be made
through the Web Site, and payments shall be made by credit card or
other approved method of payment, such as be electronic funds transfer
or debit card. Licensee agrees that Vita shall retain a 10% override
on all sales made through the Web Site by Licensee(s). Vita agrees to
pay supplier for the Product purchased, retain Vitas override, and
remit the balance to Licensee. Vita further agrees to provide
Licensee with a Monthly Sales Report of all sales made by Licensee
through the Web Site. Vita will deliver the printed breakdown by the
tenth day of the month following such sales.
12. Trade Secrets. Vita and DRM and Licensee(s) are the owners of
certain products, technology, information, customer lists, services,
processes, financial information, pending or prospective
transactions/proposals, operating and marketing plans and procedures,
designs, product formulas, specifications, manufacturing methods,
ideas, prototypes, software, patent, trademark and copyright
applications or registrations and other similar data relating to each
party's business which data is not publicly known and derives economic
value from not being publicly known (collectively "Trade Secrets").
Each party agrees that it will not use or disclose to third parties
any Trade Secret it receives from the other, except as may be
contemplated by this Agreement. Each party agrees that it will take
all reasonable precautions to assure that no Trade Secret is conveyed
to any officer, employee, agent, manufacturer or other third party who
does not have a need to know such Trade Secret. The obligations
created by this Section 10 shall survive the termination of this
Agreement or any business relationship between the parties. Any Trade
Secret contained in any writing will be returned to the other party
promptly upon written request, together with any reproductions
thereof.
13. Governing Law; Dispute Resolution. This Agreement shall be
governed by and construed in accordance with the laws of the State of
Texas. Any dispute arising under this Agreement shall be resolved
pursuant to the terms of the Dispute Resolution Agreement attached
hereto as Exhibit B.
14. Miscellaneous Provisions. This Agreement constitutes the entire
Agreement between the parties and supersedes any prior or
contemporaneous agreements, oral or written. This Agreement may only
be amended by a writing signed by both parties. This Agreement may not
be assigned without the written consent of the other party; provided
that this Agreement may be assigned without consent to an entity
acquiring all or substantially all of the assets of either party. Any
notice required or permitted to be given under this Agreement shall be
in writing and sent by telecopy, personal delivery or certified mail,
return receipt requested, as follows:
If to Vitamineralherb.Com, Inc.: Mr. J. P. Beehner
3030 FM 518 Apt 221
Pearland TX 77584-7817
If to David R. Mortenson & Associates: Mr. David R. Mortenson
P. O. Box 5034
Alvin TX 77512-5034
Fax: (281)388-1047
If to Licensee: Paragon Polaris Stratagies.com Inc. Mr. Robert
Foo
404 Scott Point Drive
Salt Spring Island, BC V8K 2R2
Canada
Fax: 250 538-0036
Notice shall be deemed effective upon receipt if made by
confirmed telecopy, personal delivery or 48 hours after deposit
in the United States mail with the required postage.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of
the date first above written.
PARAGON POLARIS STRATAGIES.COM INC.
a Nevada corporation
By:
Robert Foo, President
DAVID R. MORTENSON & ASSOCIATES
a Texas General Partnership
By _________________________________
David R. Mortenson, General Partner
EXHIBIT A
PRODUCT SPECIFICATIONS
In the event of any inconsistency between the terms of Customer's
purchase order and this Product Specification Sheet, this Sheet and
the terms of the Manufacturing Agreement shall control.
Short Product Name: _____________________________
Exact Product Ingredients and Percentages:
Other Product Specifications:
Color: ___________ Tablet Type: ____________
Consistency:______________
Weight: _______ Bottle Size/Color:____________ Bottle Count:
___________
Cotton Insert:____ Bottle Seal:____ Shrink Wrap Neck Band:___ Silicon
Pack:____
Micro-biological content: Customer to specify any requirements, if
none specified, product will be manufactured to industry standards.
Labels: Labels and/or boxes to be provided by Customer [identify any
size] _________
Labels/Boxes to be Received by [date] _____ to ensure timely delivery
Master Pack/Wrapping/Palleting Requirements (if
any):_________________________
Ship to Address: _________________________________________________
Order Quantity: (minimum 5,000 BOTTLES): ________
Price: _____________ FOB IFM's facility in San Diego, CA.
Delivery Dates(s): _______________________________________
Terms of Sale: 50% with submission of purchase order; 50% due upon
completion of manufacturing, unless otherwise specified
_________________________
Purchase Order Number: ________________
Date of Purchase Order: ________________
EXHIBIT B
DISPUTE RESOLUTION AGREEMENT
THIS DISPUTE RESOLUTION AGREEMENT ("Dispute Resolution
Agreement") is entered into and effective as of January 20, 2000 by
and between David R. Mortenson & Associates, a Texas general
partnership, and Paragon Polaris Stratagies.com Inc., a Nevada
corporation.
6. INTENT OF PARTIES. The parties desire to establish a quick, final
and binding out-of-court dispute resolution procedure to be followed
in the unlikely event any dispute arising out of or related to the
Manufacturing Agreement dated January 3, 2000 between the parties
("Agreement"). As used in this Dispute Resolution Agreement, the term
"dispute" is used in its broadest and most inclusive sense and shall
include, without limitation, any disagreement, controversy, claim, or
cause of action between the parties arising out of, related to, or
involving the Agreement or the transactions evidenced by the Agreement
(collectively "Dispute").
7. NEGOTIATION. It is the intent of the parties that any Dispute be
resolved informally and promptly through good faith negotiation
between the parties. Therefore, in the event of a Dispute between the
parties, the following will apply:
A. Correspondence. Either party may initiate negotiation
proceedings by writing a certified or registered letter,
return receipt requested, to the other party referencing
this Dispute Resolution Agreement, setting forth the
particulars of the Dispute, the term(s) of the Agreement
involved and a suggested resolution of the problem. The
recipient of the letter must respond within ten (10) days
after its receipt of the letter with an explanation and
response to the proposed solution.
B. Meeting. If correspondence does not resolve the Dispute,
then the authors of the letters or their representatives
shall meet on at least one occasion and attempt to resolve
the matter. Such meeting shall occur not later than thirty
(30) days from the parties' last correspondence. If the
parties are unable to agree on the location of such a
meeting, the meeting shall be held at DRM's corporate
offices. Should this meeting not produce a resolution of the
matter, then either party may request mandatory mediation
(as provided below) by written notice to the other party.
8. MEDIATION. Subject to the availability of the mediator, the
mediation shall occur not more than thirty (30) days after the request
for mediation. The mediation shall be conducted by retired Judge
William Yale, former Presiding Judge of the San Diego Superior Court,
who now acts as a full-time, highly respected mediator. The mediation
shall be held in San Diego, California. The cost of mediation shall be
borne equally by the parties. The mediation process shall continue
until the Dispute (or any part thereof) is resolved or until such time
as the mediator makes a finding that there is no possibility of
resolution short of referring the parties to final and binding
arbitration.
1.
9. FINAL AND BINDING ARBITRATION. Should any Dispute (or part
thereof) remain between the parties after completion of the
negotiation and mediation process set forth above, such Dispute
shall be submitted to final and binding arbitration in San Diego,
California. The arbitration shall be governed by the provisions
of the California Code of Civil Procedure ("CCP"), and the
following provisions, which shall supersede the CCP in the event
of any inconsistency:
A. Selection of Arbitrator(s). There shall be a single
arbitrator, except in the case where the amount in
dispute exceeds $100,000, in which case there shall be
three arbitrators. If the parties cannot agree upon
acceptable arbitrators(s) within ten (10) days of the
termination of the mediation, each party shall select
one arbitrator from a list of not less than five (5)
arbitrators provided by the other party. These two
arbitrators shall select a third arbitrator who shall
serve as the sole arbitrator or the third arbitrator,
as the case may be. The determination of a majority of
the arbitrators or the sole arbitrator, as the case may
be, shall be conclusive upon the parties and shall be
non-appealable.
B. Discovery. No discovery shall be permitted, absent a
showing of good cause. Any discovery request should be
reviewed with the knowledge that this dispute
resolution process was mutually agreed upon and
bargained for by the parties with the intent to provide
a cost-effective and timely method of resolving
disputes. Any discovery granted by the arbitrator
should be limited to that necessary to protect the
minimum due process rights of the parties.
C. Equitable Remedies. Any party shall have the right to
seek a temporary restraining order, preliminary or
permanent injunction or writ of attachment, without
waiving the negotiation, mediation and arbitration
provision hereof. In so doing, such party shall not be
required to meet the requirement of California Civil
Code Section 1281.8. Any other form of equitable or
provisional relief and all substantive matters relating
to the Dispute shall be determined solely by the
arbitrator(s).
D. Attorney's Fees; Arbitration Costs. Each party may be
represented by an attorney or other representative
selected by the party. The costs of the arbitration
shall be borne equally by the parties. Each party shall
bear its own attorneys'/representatives' fees and
costs; provided that if the arbitrator(s) find either
party has acted in bad faith, the arbitrator(s) shall
have discretion to award attorneys' fees to the other
party.
E. Scope of Arbitration; Limitation on Powers of
Arbitrator(s); Applicable Law. No party may raise new
claims against the other party in the arbitration not
raised in the mediation. The arbitrator shall have the
power to resolve all Disputes between the parties. The
arbitrator(s) shall not have the power to award treble,
punitive or exemplary damages and the parties hereby
waive their right to receive treble, punitive or
exemplary damages, to the extent permitted by law. The
arbitrator(s) shall only interpret and apply the terms
and provision of the Agreement and shall not change any
such terms or provisions or deprive either party of any
right or remedy expressly or impliedly provided for in
the Agreement. The arbitrator(s) shall apply the law of
the State of California (excluding California's
conflict of law rules), or federal law, in those
instances in which federal law applies.
F. Designation of Witnesses/Exhibits; Duration of
Arbitration Process; Written Decision. At least thirty
(30) days before the arbitration is scheduled to
commence, the parties shall exchange lists of witnesses
and copies of all exhibits intended to be used in
arbitration. The arbitration shall be completed within
90 days o fthe selection of the first arbitrator. The
arbitrator(s) shall render a written decision, which
contains findings of fact and conclusions of law,
within 30 days of the conclusion of the arbitration and
shall specify a time within which the award shall be
performed. Judgment upon the award may be entered in
any court of competent jurisdiction.
10. MISCELLANEOUS
A. Enforcement of Negotiation/Mediation Provisions. If a
party demanding such compliance with this Agreement
obtains a court order directing the other party to
comply with this Dispute Resolution Agreement, the
party demanding compliance shall be entitled to all of
its reasonable attorneys' fees and costs in obtaining
such order, regardless of which party ultimately
prevails in the matter.
B. Severability. Should any portion of this Dispute
Resolution Agreement be found to be invalid or
unenforceable such portion will be severed from this
Dispute Resolution Agreement, and the remaining
portions shall continue to be enforceable unless to do
so would materially alter the effectiveness of this
Dispute Resolution Agreement in achieving the stated
intent of the parties.
C. Confidentiality. The parties agree that they will not
disclose to any third party that (1) they are engaged
in the dispute resolution process described herein, (2)
the fact of, nature or amount of any compromise
resulting herefrom, or (3) the fact of, nature or
amount of any arbitration award. This confidentiality
obligation shall not extend to the party's employees,
spouses, accountant, bankers, attorneys or insurers or
in the event that disclosure is otherwise required by
law.
D. Time to Initiate Claims. An aggrieved party must mail
and the other party must receive the correspondence
which initiates negotiation proceedings in connection
with a Dispute as specified in Paragraph 2(A) (1)
within one (1) year of the date the aggrieved party
first has, or with the exercise of reasonable diligence
should have had, knowledge of the event(s) giving rise
to the Dispute (the "One Year Statute of Limitations").
No Dispute may be raised under this Dispute Resolution
Agreement after the expiration of the One Year Statute
of Limitations.
E. Entire Agreement. These dispute resolution provisions
express the entire agreement of the parties and there
are no other agreements, oral or written, concerning
dispute resolution, except as provided herein. Any
ambiguity in the provisions hereof shall not be
construed against the drafter. This Dispute Resolution
Agreement may only be modified in a writing signed by
both parties.
F. Successors. This Dispute Resolution Agreement is
binding upon and inures to the benefit of the parties,
their agents, heirs, assigns, successors-in-interest,
and any person, firm or organization acting for or
through them.
G. Venue and Jurisdiction. Venue and exclusive
jurisdiction for any action arising out of or related
to this Dispute Resolution Agreement (including, but
not limited to, equitable actions contemplated by
Section 4 (C) and actions brought to enforce or
interpret this Dispute Resolution Agreement) shall be
in the state courts for the County of San Diego,
California or the federal court for the Southern
District of California.
H. Notice. Any notice or communication required to be
given hereunder shall be in writing and shall be mailed
via the United States Postal Service by Certified Mail
or Registered Mail, Return Receipt Requested, or by
Federal Express or other overnight courier which can
document delivery, to the address of the party to be
served as shown below (or such other address as the
party shall from time to time notify). Such notice
shall be deemed to have been served at the time when
the same is received by the party being served.
David R. Mortenson & Assoc.: David R. Mortenson,
Gen. Partner
P. O. Box 5034
Alvin, Texas 77512-5034
Fax: 281-388-1047
Phone: 281-331-5580
Paragon Polaris
Stratagies.com Inc.: Robert Foo
404 Scott
Point Drive
Salt Spring Island,
BC V8K 2R2 Canada
Fax: 250-538-0036
Phone: 250-537-5732
I. Acknowledgment of Legal Effect of this Dispute
Resolution Agreement. By signing this Dispute
Resolution Agreement, the parties acknowledge that they
are giving up any rights they may possess to have
Disputes litigated in a court and are hereby waiving
the right to a trial by jury. The parties further
acknowledge that they are agreeing to a one year
statute of limitations regarding all Disputes and that
they are giving up their judicial rights to discovery
and to appeal, unless such rights are specifically set
forth above. The parties acknowledge that if they
refuse to submit to the provisions of this Dispute
Resolution Agreement they may be compelled to do so
under the authority of the California Code of Civil
Procedure. The parties acknowledge that they have had
the opportunity to consult counsel regarding the
meaning and legal effect of this Dispute Resolution
Agreement and enter into it knowingly and voluntarily.
IN WITNESS WHEREOF, the parties have entered into this
Dispute Resolution Agreement as of the date first above written.
Paragon Polaris Stratagies.com Inc.
a Nevada Corporation
By:
Robert Foo, President
David R. Mortenson & Associates
A Texas General Partnership
By:
David R. Mortenson
EXHIBIT 10.3
WATER TREATMENT LICENSE AGREEMENT
LICENSE AGREEMENT
This agreement ("Agreement") made and entered into effective
July 1, 1999 ("Effective Date") by and between David R. Mortenson
& Associates, having their principal place of business at P.O.
Box 5034, Alvin, Brazoria County, Texas, U.S.A., ("Grantor") and
Paragon Polaris Stratagies.com Inc. (ALicensee@), a Nevada
Corporation whose registered office is at 50 West Liberty Street,
Suite 880, Reno, Nevada 89501;
W I T N E S S E T H:
WHEREAS, Grantor has certain rights as evidenced by the
attached Distribution Agreement (the ADistribution Agreement@) to
Products developed by NW Technologies, Inc. (ANWT@), a Texas
corporation with its principal offices at 5817 Centralcrest,
Houston, Texas 77092, which company has developed proprietary
know-how in the Products, including Products covered by one or
more US Patents that have been licensed to NWT, and other
Products (as hereinafter defined); and
WHEREAS, NWT has proprietary rights to trade dress and
trademarks for the brand name "Natures' Way" and "The
Environmental Solution", and other trademarks and trade dress as
may be revealed to Licensee from time to time, collectively
referred to as Marks; and
WHEREAS Grantor is under obligation to maintain the
proprietary rights of NWT to the Marks and to protect NWTs
proprietary know-how, as outlined in the Distribution Agreement;
and
WHEREAS, NWT and Grantor desire to have the Products marketed
by the Licensee, under the Licensees own private label, in the
Territory (as hereinafter defined); and
WHEREAS, Licensee desires to market the Products in the
Territory and hereby acknowledges NWTs exclusive ownership of
all of the Marks;
NOW, THEREFORE, in consideration of the mutual covenants set
forth herein, and other good and valuable consideration, Grantor
and Licensee agree as follows:
ARTICLE I
GRANT, TERRITORY AND PRODUCTS
1.01 Grant and Territory. (a) Grantor hereby designates
Licensee as a Private Label distributor for the marketing of the
Products in the market(s) and geographic area(s) set forth in
Exhibit "A" hereto, ("Territory"). Licensee hereby accepts the
designation as a distributor on the terms and subject to the
conditions contained herein.
(b) Licensee hereby agrees that it will make no use of
any present or future Marks of NWT, or of any marks that would
cause confusion with the general public, for any reason without
specific written approval of NWT. Upon termination of this
Agreement for any reason Licensee agrees to cease immediately all
use and display of NWTs trademarks, service marks and trade
names (the Marks) if any permission to use the Marks has been
granted.
1.02 Products. (a) The term "Product(s)" as used herein
shall mean only those Products as defined in Exhibit "B" hereto.
(b) AAffiliated Persons@ shall mean officers,
employees, sales representatives, consultants or other employees
or non-employees to whom Licensee grants authority to represent
the Products.
(c) Licensees owned label, (Private Label),
shall mean that the Product(s) shall be packaged by Licensee
utilizing a label on the packages of the Licensee=s own design
and invention. Since Licensees intended uses of the Product are
outside the scope of the expertise of Grantor or its personnel,
Grantor will not be required to furnish label detail to Licensee.
1.03 Compensation: Distributor agrees to pay Grantor the
sum of $2,000 in the form of 2,000,000 shares of Distributors
common stock having a par value of $0.001 each (the Shares),
and to issue as of the date of execution of the Subscription
Agreements therefor certificates to the members of Grantors
Association in the amounts set forth in the schedule attached
hereto as Exhibit F. Grantor warrants that each of the members
of the Association are Aaccredited investors@ as that term is
defined in Rule 501 of Regulation D under the Securities Act of
1933, as amended. Distributor agrees to file a notice of sale of
the Shares pursuant to Rule 504 on Form D with the U.S.
Securities & Exchange Commission.
ARTICLE II
DURATION, TERMINATION AND NATURE OF RELATIONSHIP
2.01 Duration. The term of this Agreement shall be three (3)
years from the Effective Date unless terminated earlier as herein
provided. This Agreement may be renewed by Licensee for
additional three (3) year periods if no event of default exists
and all other provisions of this Agreement are in full force and
effect.
2.02 Termination. (a) This Agreement may be terminated
by Grantor for cause upon the giving of notice as herein
provided.
(b) Termination for Cause. In the event that Licensee shall
file a voluntary petition in bankruptcy or for reorganization of
indebtedness, or that Licensee should, for a period of more than
ninety days be the subject of an involuntary bankruptcy
proceeding or receivership over all or substantially all of
Licensee=s assets, or that Licensee or any Officer or Director of
Licensee should be found guilty of a felony or a crime involving
moral turpitude, or that Licensee shall, with knowledge and
deliberation, breach any provision of this Agreement, then
Company may immediately, upon delivery of written notice to
Licensee, terminate this Agreement. Cause shall also include the
violation by Licensee of any of the provisions, purchase
requirements, or monetary requirements of this Agreement (AEvents
of Default@).
(c) Licensee will be allowed 30 days after written
notification of an Event of Default to correct the violation,
except for monetary provisions which will not be granted a grace
period by Grantor.
(d) Termination of this Agreement shall not release Licensee
or Grantor from the obligations of either party contained herein.
(e) Termination of this Agreement cancels any rights granted
to Licensee herein.
2.02 Nature of Relationship. (a) This Agreement does not
constitute nor empower the Licensee as the agent or legal
representative of Grantor for any purpose whatsoever. Licensee
is and will continue to be an independent contractor.
(b) The arrangement created by this Agreement is not,
and is not intended to be, a franchise or business opportunity
under the United States' Federal Trade Commission Rule:
Disclosure Requirements and Prohibitions Concerning Franchising
and Business Opportunity Ventures and is not a franchise,
business opportunity or seller assisted marketing plan or similar
arrangement under any other federal, state, local or foreign law,
rule or regulation;
(c) Licensee shall not repackage or re-label Products
for any reason, except as may be allowed in any licensing
agreement issued by Grantor, without prior written authorization
from Grantor. Notwithstanding the provisions of this paragraph
2.03(c) it is understood by Company that Licensee will repackage
Product and apply Licensees own label to the containers. The
purpose of this section is to assure that Licensee will not re-
label any Product incorrectly whereby the public would be
confused with the recommended use of the Product.
(d) Licensee declares that it will not sell or offer
for sale the product Biocatalyst for use in applications
involving bioremediation of hydrocarbons or where microbes are
used, enhanced or suggested for use without specific written
authorization from Grantor. The language herein is not intended
to prohibit the Licensee=s use of the Product for that purpose in
remediation of sewage or waste water, whether in septic tanks or
waste water treatment facilities and the like, nor to prohibit
Licensee=s use of the Product in pond remediation, exclusive of
remediation of petroleum-based hydrocarbon contamination.
Licensee acknowledges that its intended use of the product
ABiocatalyst@ for remediation of sewage or waste water, exclusive
of remediation of petroleum-based hydrocarbon contamination has
not been specifically tested by Grantor and as a consequence of
this is not included as a recommended use of the product
Biocatalyst by Grantor or NWT. Notwithstanding the foregoing,
both parties acknowledge that in bioremediation, Biocatalyst is
specifically used to enhance the growth of microbes in soils,
particularly at depths where oxygen exchange is limited.
ARTICLE III
CONFIDENTIALITY, INDEMNITY AND REMEDIES
3.01 Confidential Information. (a) Licensee acknowledges
that in performing its obligations hereunder it will have access
to confidential information and trade secrets of NWT and Grantor
not generally known to the public ("Confidential Information")
and Licensee is obligated to maintain the confidentiality of the
Confidential Information on its own behalf and on behalf of its
"Affiliated Persons" to whom Confidential Information is
disclosed. For the term of this Agreement and for a period of 5
years after cancellation hereof Licensee and its Affiliated
Persons will treat all Confidential Information in a
confidential manner.
(b) Licensee agrees that it will not analyze or otherwise
test, or submit to anyone else for analysis or testing
(chemically or otherwise) any Product unless approved in writing
by Grantor and NWT and unless NWT and Grantor are directly
involved in the testing. NWT and Grantor grant the Licensee
hereunder the right to have the Product tested for the presence
of oxygen, pathogens or other nondesirable components. Grantor
makes no warranty as to the content of the Product.
(c) Licensee agrees to sign and to have its affiliated
persons sign confidentiality agreements in the same form as
contained herein or as approved by Grantor.
3.02 Noncompetition. Licensee agrees that the relationship
between Licensee and Grantor is of a special nature and further
agrees on its own behalf and on behalf of its Affiliated Persons
that during the term of this Agreement and for a period of twelve
(12) months from and after the termination of this Agreement that
Licensee and its Affiliated Persons will not engage or hold any
interest, directly or indirectly, in any enterprise engaged in
the manufacture, sale or distribution of products of the type
manufactured, sold or distributed by Grantor as of the date this
Agreement is terminated.
3.03 Remedies. Licensee agrees that Grantor shall be entitled
to seek and obtain injunctive relief from a court of competent
jurisdiction for the purposes of restraining Licensee from any
actual or threatened breach of the provisions contained herein.
3.04 Indemnity of Licensee and Grantor. Licensee and Grantor
shall indemnify the other and hold them harmless from and against
any and all claims, losses, costs, expenses and liabilities of
any kind, including without limitation court costs and reasonable
attorneys' fees, suffered or incurred by any of them on account
of, related to, or arising out of the conduct of the Licensee's
or Grantor's business as the case may be.
ARTICLE IV
GRANTOR'S OBLIGATIONS TO LICENSEE
4.01 License to Produce. Grantor agrees to grant to Licensee
a non-exclusive license to manufacture the product ABiocatalyst@
upon the following terms and conditions:
(a) License. After the Licensee has purchased a minimum of
5,000 gallons of Product each month for a minimum period of six
(6) consecutive months a license will be granted to Licensee to
produce the product in a location to be named by Licensee and
approved by Company with methods of production and security
measures as approved by Company. However, if after the effective
date hereof, Licensee, his successors or permitted assigns, can
demonstrate to Grantor=s satisfaction the financial capability of
Licensee, his permitted successors or assigns, then upon a
payment of a one time fee of $25,000.00 the provisions of this
section will be deemed by Company to have been fulfilled and the
referenced License to Produce will be granted by Company.
(b) The ingredient ABiomas@ as used in the Product will be
supplied by Grantor upon terms, conditions and pricing that may
be stated to Licensee by Grantor at the time of issue of the
subject License to Produce.
(c) Royalty and Expense. At the time of issuance of the
subject License to Produce a one-time payment of $10,000.00 will
be made to Grantor by Licensee to reimburse Grantor for
unspecified expenses. A monthly royalty of 8% (eight percent) of
gross sales of Licensee will be paid by Licensee to Grantor
within 20 days of the end of each month.
(d) Minimum Royalties. The minimum annual royalties to be
paid by Licensee hereunder, commencing with the granting of a
License to Produce from Grantor to Licensee will be $20,000.00.
The minimum annual royalties to be paid hereunder are non-
accumulative.
4.02 Personnel. Grantor agrees to make available to Licensee
Grantor's trained technical personnel for consultation from time
to time, if Licensee so requests in writing. Such consultation
may be by telephone or in person. If Licensee requires the
personal assistance of on site technical personnel, then Licensee
will pay actual travel and living expenses for such personnel as
agreed between Grantor and Licensee and an additional fee (per
diem) of $300.00 per day for each technical person requested.
ARTICLE V
LICENSEE'S OBLIGATIONS TO GRANTOR
5.01 Develop Territory. Licensee agrees to (i) use its best
efforts to market the Product in specified markets throughout the
Territory, (ii) devote such time and effort as may be necessary
to do so, (iii) retain and train sufficient staff that is
knowledgeable in the sale and use of the Products, and (iv)
maintain facilities sufficient to market, sell, and distribute
the Products.
5.02 Business Records. Licensee agrees to maintain reasonably
detailed and accurate records relating to the use of the Products
and to furnish to Grantor a detailed copy of all sales records,
invoice copies, copies of all testimonial letters, product usage
data and other records and reports relating to the sale and use
of the Products within the Territory (the ABusiness Records@)
upon request in writing by Grantor.
5.03 Compliance with Laws. Licensee agrees, on its behalf and
on behalf of its "Affiliated Persons" not to perform any acts or
transactions which would place Grantor or Licensee in violation
of domestic, foreign, or international laws, rules or regula
tions.
5.04 Information Regarding Use of Product. Licensee agrees
to forward to Grantor any and all information, including written,
digital, or pictorial pertaining to the use and distribution of
the Products as such information becomes known to Licensee.
5.05 Inventories. Licensee agrees to maintain adequate
inventories of Products in the Territory to service customers
needs.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF LICENSEE
6.01 Organization. Licensee represents and warrants to
Grantor that Licensee has the authority to enter into this
Agreement and to perform its obligations hereunder.
6.02 No Defaults. Licensee represents and warrants to Grantor
that neither the execution and delivery of this Agreement nor the
performance of the transactions contemplated hereby will conflict
with or result in a breach or violation of any agreement,
document, instrument, judgment, decree, order, governmental
permit, certificate or license to which Licensee is a party or to
which Licensee is subject.
ARTICLE VII
TERMS OF SALE
7.01 Standard Terms and Warranties. SINCE THE USE OF THE
PRODUCTS ARE BEYOND THE CONTROL OF GRANTOR THE PRODUCTS ARE SOLD
"AS IS", "WHERE IS", WITH NO WARRANTIES, EXPRESS OR IMPLIED.
GRANTOR MAKES NO WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO
THE PRODUCTS OR THEIR PERFORMANCE OR AS TO SERVICE, TO LICENSEE
OR ANY OTHER PERSON. IMPLIED WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE, TO LICENSEE OR TO ANY OTHER
PERSON ARE HEREBY DISCLAIMED. IN NO EVENT SHALL GRANTOR BE LIABLE
TO LICENSEE OR ANY PERSON FOR INCIDENTAL OR CONSEQUENTIAL
DAMAGES. THE LIABILITY OF GRANTOR, IF ANY, FOR DAMAGES RELATING
TO ANY ALLEGEDLY DEFECTIVE PRODUCT UNDER ANY LEGAL OR EQUITABLE
THEORY SHALL BE LIMITED TO THE ACTUAL PRICE PAID FOR SUCH
PRODUCT. Grantor may change the limited warranty contained in
this Section 7.01 at any time.
7.02 Placement of Orders and Shipping Terms. All
shipments of Product shall be FOB Grantor's plant, Houston,
Texas, unless specifically agreed otherwise and all shipments
will be made by common carrier in accordance with regulations
relating thereto and delivery is not guaranteed by Grantor at or
to the destination. Grantor is not responsible for claims for
shortages or damage in transit; such claims must be made by the
Licensee against the carrier. All orders shall be placed with
Grantor in writing upon forms approved by Grantor and Licensee
shall verify the accuracy of the order. Grantor has the right to
accept or reject any order, and the terms and conditions thereof,
if the Licensee is in default with any of the requirements or
conditions of this Agreement.
7.03 Claims of Faulty Products. Any claims for faulty
Products shall be governed by the Uniform Commercial Code of
Texas, USA unless stated otherwise in this Agreement.
7.04 Title and Risk of Loss. Products sold to Licensee shall
become the property of Licensee and title and risk of loss shall
pass to Licensee at the time of delivery of the Products to a
carrier for shipment to Licensee or Licensee customer, subject,
however, to a security interest which Grantor hereby reserves in
the Products until payment for the Products is received by
Grantor.
7.05 Payment Terms. Licensee shall make payment to Grantor in
U.S. dollars to Grantor for all materials ordered under this
Agreement at the address set forth herein, and upon the terms and
manner of payment as shown on the Price List of Grantor as
amended from time to time.
7.06 Credit Sales. Licensee and Grantor both acknowledge and
agree that if any sale on credit is permitted hereunder Grantor
hereby retains a security interest in and lien upon the Products
so sold until payment in full is received by Grantor.
7.07 Insurance. Licensee shall secure and maintain insurance
on its inventory of Products purchased on credit in the U.S.
dollar amount at least equal to the amount owing to Grantor by
Licensee. Such insurance coverage shall list Grantor as an
additional insured party.
7.08 Prices. Licensee's price from Grantor for Products
and printed matter shall be as set forth in Grantor's current
published pricing schedule. This pricing is subject to change
from time to time upon written notice transmitted by facsimile,
or US Mail, by Grantor to Licensee not less than ten (10) days in
advance of any price changes. Prices for Product by Grantor to
Licensee shall be as shown on Exhibit AB@ attached hereto.
7.09 Printed Matter. Licensee is prohibited from producing
and distributing his own literature, or from any action that
would give the impression directly or indirectly, to others that
Product and/or the AMarks@ are the property of Licensee.
7.10 Biomas Supply. At the time that an Agreement allowing
the Licensee to produce the Product as allowed by the terms and
conditions stated in this Agreement the formulae and processes
for the production of the raw material ABiomas@ will be placed
with an escrow agent acceptable to both Licensee and Grantor. If
Grantor is not able to supply Biomas in quantities sufficient to
meet Licensee needs for production of Product, and the non-supply
condition continues for a period of 90 (ninety) days, then
Licensee will be allowed to produce Biomas in accordance with a
non-exclusive License to Produce to be issued by Grantor in
accordance with the License form deposited with the formulae and
processes with the approved escrow agent.
ARTICLE VIII
MISCELLANEOUS CONDITIONS
8.01 Governing Law. This Agreement and any questions
concerning its validity, construction and performance shall be
governed by the laws of the State of Texas, U.S.A., with venue in
Harris County, Texas. Further, the parties to this Agreement
hereby irrevocably submit to the exclusive jurisdiction of the
federal courts sitting in Harris County, Texas, for any action or
proceeding arising out of or relating hereto.
8.02 Notices. Any notice or other communication required or
permitted to be given hereunder shall be in writing and shall be
sent by certified United States mail, return receipt requested to
the other party at the address specified in the first paragraph
of this Agreement. The address of either party specified above
may be changed by a notice given by such party to the other party
in accordance with this Section 8.02.
8.03 Excuse of Performance. Grantor=s and Licensee=s
performance (other than Licensee=s obligation to pay for Products
or other fees or monetary obligations in accordance herewith,
which shall not be excused) hereunder shall be excused if (but
only for so long as) any of the following conditions or events
occur and are continuing: Labor conflicts, strikes, lock-outs,
fires, explosions, war, civil disturbances, unforeseen military
action, governmental action, requisitions or seizures, delays of
subcontractors or vendors, unavailability of raw materials or
transport facilities, acts of God or nature, or any other
condition or event which is beyond the reasonable control of
Grantor or Licensee, as the case may be.
8.04 Entire Agreement. This Agreement, the Exhibits hereto
and any confidentiality agreement and subdistribution agreement,
constitute the entire agreement between the parties with respect
to the subject matter hereof and may not be altered or modified
except by an agreement in writing referring to this agreement and
signed by the parties hereto. Grantor and the Licensee agree that
this agreement supersedes all prior agreements written or oral.
8.05 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original,
and all of which together shall constitute but one and the same
instrument.
8.06 No Waiver. No failure or delay by any party hereto in
exercising any right, in whole or in part, power or privilege
hereunder shall operate as a waiver thereof.
8.07 Amendment. This Agreement may not be amended or modified
except by an instrument in writing signed on behalf of the
parties thereto specifically referencing this Agreement.
8.08 Severability. Any provisions hereof prohibited by or
unlawful or unenforceable under any applicable law of any
jurisdiction shall be ineffective as to such jurisdiction,
without affecting any other provision of this Agreement.
8.09 Binding on Successors; Assignment. This Agreement is
binding on, and shall inure to the benefit of the parties hereto
and their respective successors, heirs and permitted assigns.
This Agreement and any rights or duties hereunder may not be
assigned by Licensee, whether such assignment occurs by merger,
consolidation, sale, lease, other disposition of or any other
business combination of Licensee, without the prior written
consent of Grantor. Grantor may assign its rights hereunder to
any person provided that such person, either expressly or by
operation of law, assumes Grantor=s obligations hereunder. The
above notwithstanding, Grantor understands that Licensee is, as
of the effective date hereof, negotiating with several companies
for the purpose of entering into a merger, joint venture, or
marketing arrangement specifically for the purpose of marketing
or financing Licensee=s efforts in marketing of the Product.
Grantor agrees that as long as the requirements of this Agreement
are fulfilled that Grantor will not unreasonably deny a request
to allow Licensee to enter into the contemplated agreement.
8.10 Attorneys' Fees. If any action at law or in equity is
necessary to enforce or interpret the terms of this Agreement,
the prevailing party shall be entitled to reasonable attorneys'
fees, costs, and necessary disbursements in addition to any other
relief to which such party may be entitled.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed by their duly authorized representatives on the dates
set forth beneath their respective signatures below, to be
effective for all purposes as of the date first above written.
PARAGON POLARIS
STRATAGIES.COM INC. DAVID R. MORTENSON &
ASSOCIATES
BY:_____________________ BY:_________________
TITLE: _________________
DATE: __________________ DATE: _____________
EXHIBIT "A"
TERRITORY
Geographic Area:
Exclusive Private Label License for the State of Pennsylvania for
remediation of sewage and waste water, whether in septic tanks or
waste water treatment facilities, exclusive of remediation of
petroleum-based hydrocarbon contamination. Licensee may not make
any use of Grantor=s or NWT=s marks, name, or make any reference
to NW Technologies, Inc. in labeling, packaging, or advertising
materials of any kind. Grantor agrees to inform by letter all
existing Licensees that exclusive marketing, distributing, and
production rights have been granted to the Licensee, and to upon
request, furnish copies of such letters to the Licensee. Grantor
agrees to exclude the above-mentioned rights from future
contracts it may issue to other Licensees.
Licensees Obligations to Grantor: Licensee agrees to minimum
purchase requirements as shown in Exhibit AC@.
EXHIBIT AB@
Products Included in This Agreement
The product Biocatalyst is the only product included in this
Agreement subject to provisions of the Agreement.
The product Biomas in included herein only if a license to
product the Product is granted to Licensee in accordance with the
terms and conditions contained herein.
Prices: The initial price to Licensee for the Product Biocatalyst
is $2.00 per gallon in 2,000 gallon quantities to be packaged in
a bulk container furnished by Licensee. The suitability of the
bulk container to receive and transport the Product is, and will
remain, the responsibility of Licensee.
EXHIBIT "C"
PURCHASE OBLIGATIONS
1ST year $125,000.00
2nd Year $175,000.00
Notwithstanding the above, if Licensee shall have purchased
the right to produce as outlined in Section 4.01 of this
Agreement, Licensee shall have no purchase requirement.
EXHIBIT "D"
PAYMENT TERMS
The payment terms relating to this Agreement are cash in
advance.
EXHIBIT AE@
CONFIDENTIALITY AGREEMENT
WITNESSETH:
This Agreement by and between NW Technologies, Inc., a Texas
corporation with its principal offices located at 5817
Centralcrest, Houston, Harris County, Texas 77092 (herein
ANWT@), David R. Mortenson & Associates, with its principal
office located at P.O. Box 5034, Alvin, Brazoria County,
Texas 77512 (herein AMortenson@), jointly hereinafter
referred to as ADiscloser@; and Paragon Polaris
Stratagies.com Inc. a Nevada corporation with principal
offices at P. O. Box 5034, Alvin, Brazoria County, Texas
77512-5034 (herein ADisclosee@) is made and entered into
this 2nd day of April, 1999.
WHEREAS, NWT has developed proprietary know-how in its
products marketed under the trade name "Natures' Way" and
ABiocatalyst@; and other trade names from time to time, and;
WHEREAS, NWT has proprietary rights to trade dress,
trademarks, and designs for the brand name "Natures' Way",
ABiocatalyst@, "The Environmental Solution", manufacturing
processes and procedures, application processes and
procedures, and;
WHEREAS, NWT has entered into an exclusive marketing
agreement with Mortenson to market its product Biocatalyst
under his own brand names, including among others, OxyMax,
O-Max, O2Max, Oxy-Ice, O-Gel, O2Gel for
agricultural use;
NOW THEREFORE, in consideration of the mutual covenants
set forth herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby
acknowledged, the Discloser and Disclosee agree as follows:
1.0 ANALYSIS OF SAMPLES OR PRODUCT: Parties hereto
agree that Disclosee will not analyze (chemically or
otherwise) or cause to be analyzed any of NWTs BioCatalyst
product, except as specifically required by state or federal
statute, regulation, common law, or court order. No such
analysis of Biocatalyst shall be made without 10 days'
advance written notice to NWT, and NWT shall be responsible
for and pay for any deviation from the testing protocol that
may be required by NWT.
2.0 CONFIDENTIALITY OF INFORMATION: Parties hereto
acknowledge that they will have access to confidential,
specialized, and proprietary information and trade secrets
of NWT not generally known to the public which are the
proprietary information of NWT. Parties hereto agree that
the Confidential Information revealed to them is a valuable
proprietary interest of NWT and that they are obligated to
maintain the confidentiality of the Confidential Information
so revealed. The Parties hereto agree that they will not
disclose or authorize any other person to disclose, publish,
disseminate or use the Confidential Information, and will
treat all Confidential Information in a confidential manner.
The Parties hereto acknowledge that NWT would be irreparably
harmed by the unauthorized use of the Confidential
Information herein referred to.
3.0 GOVERNING LAW: This agreement and any questions
concerning its validity, construction and performance shall
be governed by the laws of the State of Texas, U.S.A., with
venue in Harris County, Texas.
4.0 ENTIRE AGREEMENT: This agreement is the entire
agreement between the parties with respect to the subject
matter hereof and may not be altered or modified except by
an agreement in writing signed by the parties hereto.
5.0 NO WAIVER: No failure or delay by any party hereto
in exercising any right, power or privilege hereunder shall
operate as a waiver thereof nor shall any single or partial
exercise thereof or the exercise of any right, power or
privilege.
6.0 AMENDMENT: This Confidentiality Agreement may not
be amended or modified except by an instrument in writing
signed on behalf of the parties thereto.
7.0 SEVERABILITY: Any provisions hereof prohibited by
or unlawful or unenforceable under any applicable law of any
jurisdiction shall be ineffective as to such jurisdiction,
without affecting any other provision of this Agreement or
in any other jurisdiction.
8.0 ATTORNEYS' FEES: If any action at law or in equity
is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to
reasonable attorneys' fees, costs, and necessary
disbursements in addition to any other relief to which such
party may be entitled.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed by their duly authorized
representatives on the dates set forth beneath their
respective signatures below, to be effective for all
purposes as of the date first above written.
NW TECHNOLOGIES, INC. PARAGON POLARIS
STRATAGIES.COM INC.
BY: BY:
C. E. Kaiser, Chairman J. P. Beehner,
President
DATE:
DAVID R. MORTENSON & ASSOCIATES
By:
David R. Mortenson
EXHIBIT F
SHARE DISTRIBUTION SCHEDULE
Member Address SSN No. of
Shares
to be
issued
David R. P.O. Box 5034 388-46- 200,000
Mortenson Alvin TX 77512- 6127
5034
Terry Fowler 545 Teal Dr 449-86- 200,000
Dickinson TX 0220
77539
Joshua J. 808 Cemetery Rd 533-17- 200,000
Mortenson Alvin TX 77511 4731
Laurent R. 735 International 642-22- 200,000
Barbudaux Blvd #111 8855
Houston TX 77024
Marie M. Charles P. O. Box 34830 467-19- 200,000
Houston TX 77034 3655
C. E. Kaiser 10220 Memorial Dr 449-30- 200,000
#67 8242
Houston TX 77024
Roy Donovan P. O. Box 4456 439-96- 200,000
Hinton Jr. Pasadena TX 77502 3960
James R. 7716 Windswept 466-42- 200,000
Collins, D.V.M. Lane 8776
Houston TX 77063
Jock R. Collins, 7627 Skyline 466-42- 200,000
D.V.M. Drive 8959
Houston TX 77063
Joshua D. 2101 Mustang Rd 604-05- 200,000
Smetzer Apt 113 4892
Alvin TX 77511
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITOR
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1780 South Bellaire
Suite 500
Denver, CO 80222
The Board of Directors
PARAGON POLARIS STRATAGIES.COM INC.
404 Scott Point Drive
Salt Spring Island, BC V8K 2R2
Canada
Dear Sirs:
This letter will authorize you to include the Audit of your
company dated December 31, 1999 and the Audit Report dated
March 9, 2000 in the Registration Statement currently under
review with the Securities and Exchange Commission.
Yours Truly,
/S/ Janet Loss, C.P.A., P.C.
Janet Loss, C.P.A., P.C.
June 24, 2000
