UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
SAVANNAH RIVER GROUP, INC.
(Name of small business issuer in its charter)
Nevada 5499 76-0616460
(State or jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or Classification Code Number) Identification No.)
organization)
Jason Dussault With a copy to:
688 West Hastings Street
Suite 910 Roger L. Shoss, Esq.
Vancouver, B.C. V6B 1P1 Shoss & Associates
(604) 331-3464 700 Louisiana, Suite 4260
Houston, Texas 77002
(713) 225-0502
Approximate date 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,
please 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
Tile of each Amount to be Proposed Proposed Amount of
class of securities registered maximum offering maximum aggregate registration fee
to be registered price per unit offering price
Common Stock 1,000,000 0.025 per share 25,000.00 6.60
(1)
</TABLE
(1) No exchange or over-the-counter market exists for Savannah
River Group, Inc. (the Company)s common stock. There have
been no sales of stock from one investor to another. The
most recent transfer of the Companys common stock occurred
on June 15 1, 2000 when the Company initially transferred
2,000,000 shares to Jason Dussault and 1,500,000 shares to
Shane Lowry in exchange for $2,000.00 and $1,500 from each
of them respectively worth of expenses, resulting in a value
of $0.001 per share. The Company believes this transaction
supports a bona fide estimate of per share as the maximum
offering price solely for the purpose of calculating the
amount of the registration fee pursuant to Rule 457(a) under
the Securities Act of 1933.
The registrant will amend 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 Commission, acting
pursuant to said Section 8(a), may determine.
PART I INFORMATION REQUIRED IN PROSPECTUS
SUBJECT TO COMPLETION
Information contained herein may be completed or amended. A
registration statement relating to these securities has been filed
with the Securities and Exchange Commission. These securities may
not be sold nor may offers to buy be accepted before the
registration statement becomes effective. This prospectus shall
not constitute an offer to sell nor the solicitation of any offer
to buy nor may these securities be sold in any state in which such
offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any
such state
PRELIMINARY PROSPECTUS DATED: ____________, 2000
SAVANNAH RIVER GROUP, INC.
688 West Hastings Street
Suite 910
Vancouver, B.C. V6B 1P1
(604) 331-3464
1,000,000 Shares of Common Stock to be offered by the Company
This is the initial public offering of common stock of
Savannah River Group, Inc., and no public market currently exists
for shares of the Companys common stock. This prospectus is part
of a registration statement that permits the Company to sell
shares on a continuous or delayed basis in the future. There have
been no sales of shares from one investor to another.
These securities will be offered at a price of $0.025 per
share for as long as this registration statement is valid.
This is not an underwritten offering, and the Companys stock
is not listed on any national securities exchange or the Nasdaq
Stock Market.
This offering involves a high degree of risk.
See Risk Factors which begins on page 4.
Neither the Securities and Exchange Com mission, nor any
state securities commission, has approved or disapproved these
securities or passed upon the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal
offense.
TABLE OF CONTENTS
General 4
Risk factors 5
Administrative offices 5
Employees 5
Managements discussion and analysis of plan of operations 6
Use of proceeds. 6
Determination of offering price 6
Dilution 6
Selling securities holders 7
Plan of distribution 7
Legal proceedings 7
Directors and executive officers 7
Security ownership of certain beneficial owners and management 8
Description of securities 8
Interest of named experts and counsel 9
Disclosure of commission position of indemnification for
securities act liabilities 9
Description of business 9
Managements discussion and analysis or plan of operation. 16
Description of property 17
Certain relationships and related transactions 17
Market for common equity and related stockholder matters 17
Executive compensation 18
Financial statements 18
Changes in and disagreements with accountants on accounting 28
Indemnification of directors and officers 28
Recent sales of unregistered securities. 29
Exhibits 29
GENERAL
Savannah River Group, Inc. was incorporated under the laws of
the State of Nevada on August 19, 1999 whose principal offices are
located in Vancouver, British Columbia. The Company is in the
early developmental and promotional stages. To date, the Company
has worked solely on organizational activities; specifically,
raising its initial capital and developing its business plan. The
Company has not commenced operations. The Company has no full
time employees and owns no real estate. Under its corporate
charter, the Company may engage in any activity for which
corporations may be organized under the General Corporation Law of
the State of Nevada. Currently the sole asset of the Company is a
License Agreement between it and David R. Mortonson & Associates
under which the Company has the right to market vitamins, minerals
and nutritional supplements available through a third-party
companys, Vitamineralherb.com, Inc., web site, in the state of
Georgia.
RISK FACTORS
You should carefully consider the following risk factors and
all other information contained in this prospectus before
purchasing the common stock of the Company. Investing in the
Companys common stock involves a high degree of risk. Any of the
following risks could adversely affect the Companys business,
financial condition and results of operations and could result in
a complete loss of your investment. The risks and uncertainties
described below are not the only ones the Company may face.
Additional risks and uncertainties not presently know or that are
currently deemed immaterial may also impair the Companys business
operations.
YOU SHOULD NOT RELY ON FORWARD-LOOKING STATEMENTS BECAUSE
THEY ARE INHERENTLY UNCERTAIN
This prospectus includes forward-looking statements
identified by the use of words like believes, intends, expects,
may, will, should or anticipates, or the negative equivalents of
those words or comparable terminology, and by discussions of
strategies that involve risks and uncertainties. The Company
bases all forward-looking statements upon estimates and
assumptions about future events that are derived from information
available to it on the date of this prospectus. Given the risks
and uncertainties of the Companys business, actual results may
differ materially from those expressed or implied by forward-
looking statements. The Company cannot assure you that its future
results, levels of activity and achievements will occur as it
expects, and neither the Company nor any person assumes any
responsibility for the accuracy and completeness of the Companys
forward-looking statements.
WE HAVE INCURRED LOSSES SINCE OUR INCEPTION ON AUGUST 18,
1999 AND EXPECT TO CONTINUE TO HAVE LOSSES FOR THE FORESEEABLE
FUTURE.
The Company has incurred a net loss in each quarter since
inception and expects to incur net losses for the foreseeable
future. The Companys success depends on increasing awareness of
the Vitamineralherb.com brand, providing our customers with a
quality online shopping experience and investing in systems and
technology that will support increased traffic to Vitamineralherbs
website.
WE HAVE A SOLE SOURCE SUPPLIER AND ANY INTERRUPTION OR
CHANGES IN THAT ARRANGEMENT MAY HAVE AN ADVERSE EFFECT ON OUR
ABILITY TO OPERATE.
THROUGH ITS LICENSE AGREEMENT WITH DAVID R. MORTENSON &
ASSOCIATES, THE COMPANY HAS ENTERED INTO A RELATIONSHIP WITH
VITAMINERALHERB.COM, UNDER WHICH THAT COMPANY HAS LICENSED ITS
TRADEMARKS TO US AND PROVIDES SUPPLY, FULFILLMENT, PROMOTIONAL,
ADMINISTRATIVE AND OTHER SERVICES TO US. THESE TRADEMARKS AND
SERVICES ARE CRITICAL TO OUR SUCCESS. THE AGREEMENTS CALL FOR
SIGNIFICANT PAYMENTS TO VITAMINERALHERB.COM FOR THE FORESEEABLE
FUTURE. TERMINATION OF THE INTERCOMPANY AGREEMENTS OR THE FAILURE
OF VITAMINERALHERB.COM TO PERFORM ITS OBLIGATIONS UNDER THESE
AGREEMENTS WOULD MATERIALLY HARM OUR ABILITY TO OBTAIN THE
PRODUCTS THAT WE SELL, TO FILL CUSTOMER ORDERS, TO PROMOTE OUR
BUSINESS AND TO HANDLE ADMINISTRATIVE MATTERS EFFICIENTLY. WE
DEPEND ON TRADEMARKS LICENSED FROM VITAMINERALHERB.COM. UNDER THE
TRADEMARK LICENSE AGREEMENT, VITAMINERALHERB.COM HAS LICENSED
TRADEMARKS, INCLUDING VITAMINERALHERB.COM LOGO AND NAME, TO US ON
GEOGRAPHIC BASIS IN CONNECTION WITH OUR MARKETING AND SALE OF
PRODUCTS AND SERVICES IN ONLINE COMMERCE. THE COMPANY DEPENDS ON
VITAMINERALHERB.COM AS A SUPPLIER. VITAMINERALHERB.COM WILL
FULFILL THE COMPANYS ORDERS THROUGH ITS SUPPLIER, IVES FORMULATION
COMPANY, INC.
THE COMPANY HAS NO EMPLOYMENT AGREEMENTS WITH MR. DUSSAULT OR
MR. LOWRY AND THEY ONLY SPEND PART OF THEIR TIME ON THE BUSINESS
OF THE COMPANY AND THEIR LEAVING MAY ADVERSELY IMPACT THE COMPANYS
ABILITY TO OPERATE.
The Company relies on Messrs. Jason Dussault and Shane Lowry,
who are both officers and directors of the Company. Neither is
receiving a salary nor has an employment agreement with us. The
Company does not expect either party to devote their full time
efforts to it, but there is no agreement on how much time either
Messrs. Dussault or Lowry will devote to the Company. Each may
spend a majority of their time on other business ventures. The
loss of the services of Messrs. Dussault or Lowry and/or the
failure to recruit and retain qualified managers may result in an
adverse impact on the development of the Companys business. The
Company has not obtained any key-man life insurance on either
Messrs. Dussault or Lowry.
ADMINISTRATIVE OFFICES
The Company will use space provided to it rent-free on a non-
exclusive basis by its president, Mr. Dussault, at 688 West
Hastings Street, Suite 910, Vancouver, British Columbia V6B 1P1.
EMPLOYEES
The Company has no full time employees. The Companys
president, Mr. Dussault, and its secretary/treasurer, Mr. Lowry,
have agreed to allocate a portion of their time to the activities
of the Company, without compensation. They anticipate that the
business plan of the
Company can be implemented by his devoting no more than 10 hours
per month to
the business affairs of the Company and, consequently, conflicts
of interest may
arise with respect to the limited time commitment by each officer.
MANAGEMENTS DISCUSSION AND ANALYSIS OF PLAN OF OPERATIONS
The following discussion and analysis should be read in
conjunction with the Companys Financial Statements and Notes
thereto and other financial information included elsewhere in this
Form SB-2. This Form SB-2 contains, in addition to historical
information, forward-looking statements that involve risks and
uncertainties. The Companys actual results could differ materially
from the results discussed in the forward-looking statements.
Factors that could cause or contribute to such differences include
those discussed below, as well as those discussed elsewhere in
this Form SB-2.
USE OF PROCEEDS.
Subscription Level 50% 100%
Amount of Proceeds $12,500.00 $25,000.00
THE COMPANY EXPECTS TO USE THE NET PROCEEDS FOR
ORGANIZATIONAL PURPOSES, INCLUDING, BUT NOT LIMITED TO, SATISFYING
ACCRUED LIABILITIES, TO CONDUCT A SEARCH FOR EMPLOYEES, AND TO
DETERMINE THE FEASIBILITY OF SELLING VITAMINERALHERB.COM PRODUCTS
TO SPECIFIC MARKETS.
DETERMINATION OF OFFERING PRICE
The Company arbitrarily determined the price of its shares in
this offering. The offering price is not an indication of and is
not based upon the actual value of the Company. It bears no
relation to book value, assets, earnings or any other recognized
criteria of value of the Company. The offering price should not
be regarded as an indicator of the future market price of the
shares.
DILUTION
The difference between the initial public offering price per
share of the Companys stock and the pro forma net tangible book
value per share of the Companys stock after this offering
constitutes the dilution to investors in this offering. Net
tangible book value per share is determined by dividing our net
tangible book value (total tangible assets less total liabilities)
by the number of shares of stock outstanding.
As of June 30, 2000, the Companys net tangible book value was
(-$13,200) or
(-$0.004) per share. After giving effect to our sale of 1,000,000
shares of stock in this offering and the receipt of estimated net
proceeds from this offering (after deducting legal and accounting
fees and estimated expenses of this offering), the Companys pro
forma net tangible book value as of June 30, 2000 would have been
$11,800.00, or $0.003 per share, representing an immediate
increase in net tangible book value of $0.007 per share to
existing stockholders and an immediate dilution of $0.009 per
share to new investors.
SELLING SECURITIES HOLDERS
There are no selling securities holders.
PLAN OF DISTRIBUTION
This is not an underwritten offering. This prospectus is
part of a registration statement that permits the Company to sell
shares on a continuous or delayed basis in the future. The
Company may sell some shares to the public when the registration
statement becomes effective, or it may elect to sell some or all
of their shares at a later date. The Company has not committed to
keeping the registration statement effective for any set period of
time.
LEGAL PROCEEDINGS
The Company is not a party to any material pending legal
proceedings, and none of its property is the subject of a pending
legal proceeding. Further, the officers and directors know of no
legal proceedings against the Company or its property contemplated
by any governmental authority.
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the name, age and position of
each director and executive officer of the Company:
Name Age Position
Jason Dussault 26 President, Director
Shane Lowry 30 Secretary/Treasurer,
Director
Jason Dussault has been president and director of the Company
since, June 15, 2000. Dussault is currently an independent
consultant for such clients as Pacific Capitals Market, Inc.,
which bought Liberty One Communications, an investor relations and
marketing firm which Mr. Dussault founded in 1998. Mr. Dussault
served as an independent consultant from 1995 through 1998.
Shane Lowry has been secretary/treasurer of the Company
since, June 15, 2000. Mr. Lowry is currently employed by Condor
Goldfields, Inc., a company listed on the Toronto Stock Exchange.
He has been with this company since October, 1997 and is
responsible for investor and corporate relations. From July, 1995
through May, 1997 Mr. Lowry had similar responsibilities with
Eaglecrest Explorations, Ltd., Cypange Ventures, Ltd. And U.S.
Diamond Corp., companies listed on the Vancouver Stock Exchange.
The directors named above are elected for one-year terms at
the annual shareholders meeting. Officers will hold their
positions at the pleasure of the board of directors, absent any
employment agreements. No employment agreements currently exist
or are contemplated.
Messrs. Dussault and Lowry will devote their time to the
Companys affairs on an as needed basis. As a result, the actual
amount of time which they will devote to the Companys affairs is
unknown and is likely to vary substantially from month to month.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of June 30, 2000, the
Companys outstanding common stock owned of record or beneficially
by each executive officer and director and by each person who
owned of record, or was known by the Company to own beneficially,
more than 5% of the Companys common stock, and the shareholdings
of all executive officers and directors as a group.
Name Shares Owned Percentage of Shares
Owned
Jason Dussault 2,000,000 57%
Shane Lowry 1,500,000 43%
DESCRIPTION OF SECURITIES
The following description of the Companys capital stock is a
summary of the material terms of the Companys capital stock. This
summary is subject to and qualified in its entirety by the
Companys articles of incorporation and bylaws, which are included
as exhibits to the registration statement of which this prospectus
forms a part, and by the applicable provisions of Nevada law.
The Companys authorized capital consists of 25,000,000 shares
of common stock, par value $.001 per share. Immediately prior to
this offering, 3,500,000 shares were issued and outstanding. Each
record holder of common stock is entitled to one vote for each
share held on all matters properly submitted to the shareholders
for their vote. The articles of incorporation do not permit
cumulative voting for the election of directors, and shareholders
do not have any preemptive rights to purchase shares in any future
issuance of the Companys common stock.
Because the holders of shares of the Companys common stock do
not have cumulative voting rights, the holders of more than 50% of
the Companys outstanding shares, voting for the election of
directors, can elect all of the directors to be elected, if they
so choose. In such event, the holders of the remaining shares will
not be able to elect any of the Companys directors.
The holders of shares of common stock are entitled to
dividends, out of funds legally available therefor, when and as
declared by the Board of Directors. The Board of Directors has
never declared a dividend and does not anticipate declaring a
dividend in the future. In the event of liquidation, dissolution
or winding up of the affairs of the Company, holders are entitled
to receive, ratably, the net assets of the Company available to
shareholders after payment of all creditors.
All of the issued and outstanding shares of common stock are
duly authorized, validly issued, fully paid, and non-assessable.
To the extent that additional shares of the Companys common stock
are issued, the relative interests of existing shareholders may be
diluted.
INTEREST OF NAMED EXPERTS AND COUNSEL
Neither Elliott, Tulk, Pryce, Anderson nor Shoss & Associates
was employed on a contingent basis in connection with the
registration or offering of the Companys common stock.
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR
SECURITIES ACT LIABILITIES
The Companys bylaws provide that it 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 the Company, absent a finding of negligence or
misconduct in the performance of their duty.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons
controlling the Company pursuant to the forgoing provisions, the
Company 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.
DESCRIPTION OF BUSINESS
Savannah River Group, Inc. (the Company) was incorporated
under the laws of the State of Nevada on August 19 1999 and is in
the early developmental and promotional stages. To date, the
Companys only activities have been organizational, directed at
raising its initial capital and developing its business plan. The
Company has not commenced operations. The Company has no full
time employees and owns no real estate. Under its corporate
charter, the Company may engage in any activity for which
corporations may be organized under the General Corporation Law of
the State of Nevada. The Company has not been subject to any
bankruptcy, receivership or similar proceeding, nor has it
undergone any material reclassification, merger, consolidation or
asset purchase outside of the ordinary course of business.
The Company is in the business of marketing vitamins,
minerals and nutritional supplements in the state of Georgia.
This activity will be carried out pursuant to a License Agreement
with David R. Mortenson & Associates which is itself subject to a
License Agreement between David R. Mortenson & Associates and
Vitamineralherb.com, Inc. (Exhibit 3.10). The Company will take
orders for products offered by Vitamineralherb.com and transmit
them through Vitamineralherb.coms web site. Customers may also
directly access Vitamineralherb.coms website; if such customers
originate from the marketing area licensed to the Company they
will be deemed the Companys customers. Vitamineralherb.com will
collect an annual fee for the operation of its web site and ten
percent of the gross of each sale. Vitamineralherb.com itself
will not produce the products being marketed under its name and
label. It has an arrangement with International Formulators and
Manufacturers, Inc. to produce and label products for
Vitamineralherb.com. Fulfillment of customer orders will be by
third-party shippers directly from Ives Formulation Company, Inc.
to the customers.
This is a competitive industry, with low barriers to entry.
The Company has not yet gone beyond the developmental stage. The
Company will be identified with the Vitamineralherb.com name and
website and that third-partys ability to protect its intellectual
property rights and its technological functionality is vital to
the Companys viability. The nature of the products that the
Company is marketing is such that the federal or state government
may increase regulation. See Risk Factors for a more detailed
discussion of these matters.
The Company 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
the Company and its common stock, see the registration statement
and the exhibits and schedules thereto. Any document the Company
files may be read and copied at the Commissions public reference
rooms in Washington, D.C.; New York, New York; and Chicago,
Illinois. Please call the Commission at 1-800-SEC-0330 for
further information about the public reference rooms. The
Companys filings with the Commission are also available to the
public from the Commissions website at http://www.sec.gov.
Upon completion of this offering, the Company will become
subject to the information and periodic reporting requirements of
the Securities 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 Commissions public
reference rooms, and the website of the Commission referred to
above.
DISCLOSURES
In addition to the matters discussed under Risk Factors
elsewhere in this prospectus, the following are some other issues
which may affect the viability of the Company.
THE COMPANY HAS A LIMITED OPERATING HISTORY AND MAY NOT BE
SUCCESSFUL IN ADDRESSING EARLY STAGE CHALLENGES
The Company is a new company in a new and volatile industry.
The Company expects to encounter difficulties as an early stage
company in the rapidly evolving online commerce industry. The
Companys business strategy is unproven, and it may not be
successful in addressing early stage challenges, such as
establishing its position in the market and expanding its online
presence and capabilities.
THE COMPANY MAY NEED ADDITIONAL CAPITAL TO FUND OUR EXPECTED
NEEDS FOR WORKING CAPITAL AND CAPITAL EXPENDITURES
The Company may require substantial capital to fund its
business. Since the Companys inception, it has experienced
negative cash flow from operations and expects to experience
significant negative cash flow from operations for the foreseeable
future. The Company cannot be certain that additional financing
will be available to it when required on favorable terms or at
all. The Companys inability to obtain adequate capital would
limit its ability to achieve the level of corporate growth that it
believes to be necessary to succeed. If the Company raises
additional funds in the future through the issuance of equity or
debt securities, then these securities may have rights,
preferences or privileges senior to the rights of the Companys
common stock, and holders may experience additional dilution.
THE COMPANY FACES INTENSE COMPETITION
The Company competes with numerous resellers, manufacturers
and wholesalers, including other online companies as well as
retail and catalog sources. Some of the Companys competitors may
have greater access to capital than the Company does and may use
these resources to engage in aggressive advertising and marketing
campaigns. Aggressive advertising and promotion may generate
pricing pressures which may adversely impact the Company.
CONSUMERS MAY NOT ACCEPT AN ONLINE SOURCE FOR OUR PRODUCTS
The Companys success depends on attracting and retaining a
high volume of online customers at a reasonable cost. The Company
may not be able to convert a large number of consumers from
traditional shopping methods to online shopping. Factors that
could prevent or delay the widespread consumer acceptance of
purchasing vitamins, nutritional supplements and minerals online,
and consequently our ability to increase our revenues, include: -
shipping charges, which do not apply to shopping at traditional
retail stores; - delivery time associated with online orders, as
compared to the immediate receipt of products at a physical store;
- - pricing that does not meet consumer expectations of finding the
lowest price on the Internet; - lack of consumer awareness of our
online presence; - customer concerns about the security of online
transactions and the privacy of personal health information; -
product damage from shipping or shipments of wrong or expired
products, which may result in a failure to establish customer
trust in purchasing our products online; - delays in responses to
customer inquiries or in deliveries to customers; and - difficulty
in returning or exchanging orders. The Company expects that
competition will continue to increase because of the relative ease
with which new websites may be developed. The nature of the
Internet as an electronic marketplace may facilitate competitive
entry and comparison shopping and may also render online commerce
inherently more competitive than traditional retailing formats.
Increased competition may reduce the Companys gross margins, cause
the Company to lose market share and decrease the value of the
Companys sub-license agreement with the Vitamineralherb.com brand.
THE COMPANY MAY EXPEND MORE ON ADVERTISING THAN IT GAINS IN
INCREASED SALES
The Company may rely on advertising to attract customers in
Georgia to the Vitamineralherb.com website. This advertising may
not attract a significant number of customers or generate a
substantial amount of sales.
THE COMPANY DEPENDS ON THIRD-PARTY SHIPPERS TO DELIVER ITS
PRODUCTS IN A TIMELY MANNER
The Companys customers cannot visit physical stores to pick
up its products. The Companys product distribution relies instead
on third-party delivery services, including the United States
Postal Service and United Parcel Service. Strikes and other
interruptions may delay the timely delivery of customer orders,
and customers may refuse to purchase the Companys products because
of this loss of convenience.
THE COMPANY DEPENDS ON THIRD-PARTY COMPUTER SYSTEMS
The Companys success depends on generating a high volume of
traffic to Vitamineralherb.coms website. However, growth in the
number of users accessing that companys website may strain or
exceed the capacity of its computer systems and lead to declines
in performance or system failure. The Company is forced to rely on
Vitamineralherb.coms assurances that their computer systems will
be adequate to handle consumer demand. Failure to accommodate
increased traffic may decrease levels of customer service and
satisfaction. Vitamineralherb.com must continually improve and
enhance the functionality and performance of its website, order
tracking and other technical systems to provide a convenient
shopping experience. Failure to improve these systems effectively
or within a reasonable period of time may cause customers to visit
its website less frequently or not at all. New services or
features may contain errors, and there may be delays or customer
service errors while Vitamineralherb.com corrects them. If
customers encounter difficulty with or do not accept new services
or features, they may buy from other online vendors and cause the
Companys sales to decline.
THE COMPANY COMPUTER AND COMMUNICATIONS SYSTEMS MAY FAIL OR
EXPERIENCE DELAYS
The Companys success, and in particular its ability to
receive and fulfill orders and provide quality customer service,
depends on the efficient and uninterrupted operation of our
computer systems. System interruptions may result from fire, power
loss, water damage, telecommunications failures, vandalism and
other malicious acts and problems related to our equipment.
Vitamineralherb.coms website may also experience disruptions or
interruptions in service due to failures by third-party
communications providers. The Company depends on communications
providers and Vitamineralherb.coms website host to provide it with
access to Vitamineralherb.coms website in order to transmit the
Companys orders to Vitamineralherb.com. In addition, the Companys
customers depend on their own Internet service providers for
access to our website. Periodic system interruptions will occur.
These occurrences may cause customers to perceive the Companys
website as not functioning properly and therefore cause them to
stop using its services.
THE COMPANY SOLE ASSET MAY BE IMPAIRED BY THIRD PARTY ACTIONS
OR OMISSIONS
The Companys sole asset is a License Agreement between it and
David R. Mortenson & Associates, which is subject to David R.
Mortenson & Associates licensing agreement with
Vitamineralherb.com. If David R. Mortenson & Associates defaults
under its licensing agreement with Vitamineralherb.com, Inc., the
Companys License Agreement may be worthless. Furthermore,
Vitamineralherb.com, Inc. will fulfill the Companys orders
pursuant to arrangements it has with International Formulators and
Manufacturers, Inc. (Ives Formulation Company, Inc. being its
successor) and a disagreement between those parties, or the
inability or refusal of Ives Formulation Company, Inc. to meet
Vitamineralherb.coms orders may significantly harm the Companys
customer relations and hurt the Companys future business. If
there is a complete breakdown in relations or if Ives Formulation
Company, Inc. goes out of business, then the Company may not be
able to find alternative suppliers in a timely fashion.
EXTENSIVE GOVERNMENTAL REGULATION COULD LIMIT THE COMPANYS
SALES OR ADD SIGNIFICANT ADDITIONAL COSTS TO OUR BUSINESS
Because the online market for vitamins, nutritional
supplements and minerals is relatively new, there is little common
law or regulatory guidance that clarifies the manner in which
government regulation impacts online sales. Governmental
regulation may limit our sales or add significant additional costs
to our business. The two principal federal agencies that regulate
dietary supplements, including vitamins, nutritional supplements
and minerals, are the Food and Drug Administration and the Federal
Trade Commission. Among other matters, FDA regulations govern
claims that assert the health or nutritional value of a product.
Many FDA and FTC remedies and processes, including imposing civil
penalties in the millions of dollars and commencing criminal
prosecution, are available under federal statutes and regulations
if product claims violate the law. Similar enforcement action may
also result from noncompliance with other regulatory requirements,
such as FDA labeling rules. The FDA also reviews some product
claims that companies must submit for agency evaluation and may
find them unacceptable. State, local and foreign authorities may
also bring enforcement actions for violations of these laws.
GOVERNMENT REGULATION AND LEGAL UNCERTAINTIES COULD BRING
ADDITIONAL BURDENS TO DOING BUSINESS ONLINE
Online commerce is new and rapidly changing, and federal and
state regulations relating to the Internet and online commerce are
relatively new and evolving. Due to the increasing popularity of
the Internet, it is possible that laws and regulations may be
enacted to address issues such as user privacy, pricing, content,
copyrights, distribution, antitrust matters and the quality of
products and services. The adoption of these laws or regulations
could reduce the rate of growth of the Internet, which could
potentially decrease the usage of our website and result in our
selling fewer products. In addition, the applicability to the
Internet of existing laws governing issues such as property
ownership, copyrights and other intellectual property issues,
libel, obscenity and personal privacy is uncertain. Most of these
laws were adopted prior to the advent of the Internet and do not
contemplate or address the unique issues of the Internet. New laws
applicable to the Internet may impose substantial burdens on
companies conducting online commerce. In addition, the growth and
development of online commerce may prompt calls for more stringent
consumer protection laws in the United States and abroad. We also
may be subject to regulation not specifically related to the
Internet, such as laws affecting catalog sellers. Several
telecommunications carriers have asked the Federal Communications
Commission to regulate telecommunications over the Internet. Due
to the increasing use of the Internet and the burden it has placed
on the telecommunications infrastructure, telephone carriers have
requested the FCC to regulate Internet and online service
providers and to impose access fees on those providers. If the FCC
imposes access fees, the costs of using the Internet could
increase dramatically. In this event, our margins could be
negatively impacted.
THE SALE OFVITAMINERALHERB.COM PRODUCTS INVOLVES PRODUCT
LIABILITY AND OTHER RISKS
Since the Companys activities as a marketer for
Vitamineralherb.com products may leave it open to the argument
that is a distributor of those products then it is possible that
the Company, like any other distributor or manufacturer of
products that are ingested, faces an inherent risk of exposure to
product liability claims if the use of products results in illness
or injury. If the Company does not have adequate insurance or
contractual indemnification, product liability claims could have a
material adverse effect on its business. Manufacturers and
distributors of vitamins, nutritional supplements and minerals
have been named as defendants in product liability lawsuits from
time to time. The successful assertion or settlement of an
uninsured claim, a significant number of insured claims or a claim
exceeding the limits of the Companys insurance coverage would harm
it by adding further costs to its business and by diverting the
attention of the Companys senior management from the operation of
its business. Although the manufacturers may perform research and
tests in connection with the formulation and production of the
products that the Company sells, there are no conclusive clinical
studies regarding many of its products. The Company depends upon
customer perceptions about the safety and quality of its products
and of similar products distributed by competitors. The mere
publication of reports asserting that a particular product may be
harmful may substantially reduce or eliminate sales of the
product, regardless of whether the reports are scientifically
supported and regardless of whether the harmful effects would be
present at recommended dosages. Vitamins, nutritional supplements
and minerals are subject to sharp increases in consumer interest,
which in some cases stems from discussion of particular products
in the popular press. A significant delay in or disruption of the
supply of products to Vitamineralherb.com from suppliers and
distributors may increase the Companys cost of goods and could
result in a substantial reduction or termination of sales of some
products.
WE MAY BECOME LIABLE FOR INTERNET COMMERCE TAXES
Recent federal legislation limits the imposition of state and
local taxes on the Internet. In 1998, Congress passed the Internet
Tax Freedom Act, which places a three-year moratorium on state and
local taxes on (1) Internet access, unless such tax was already
imposed prior to October 1, 1998, and (2) discriminatory taxes on
online commerce. However, Congress may not renew this legislation
in 2001, in which case state and local governments would be free
to impose Internet-specific taxes on electronically purchased
goods, in addition to any other taxes that may otherwise be
imposed on the transaction. Any such taxes would make our business
more costly to operate. Due to the high level of uncertainty
regarding the imposition of new Internet-related taxes on online
commerce, a number of states and a Congressional advisory
commission are reviewing appropriate tax treatment for online
commerce. The Company cannot predict the impact of additional laws
or regulations on our business.
MANAGEMENT HAS BROAD DISCRETION
The Companys management has broad discretion in its handling
of the Companys affairs. While currently the Company is solely
focussed on the marketing of vitamins, minerals and nutritional
supplements, the management of the Company may choose to enter
into completely different types of business and/or abandon its
current business. Investors may discover that the Company is
engaged in a business which the investor never intended to invest
in. The Companys management may evaluates acquisition
opportunities and, as a result, may engage in acquisition
discussions, may conduct due diligence activities in connection
with possible acquisitions, and, where appropriate, may engage in
acquisition negotiations. Any completed acquisition would involve
numerous risks, including difficulties in assimilating operations,
services, products and personnel of the acquired company, the
diversion of the Companys managements attention from other
business concerns, entry into markets in which the Company has
little or no prior experience, the potential loss of key
employees, and the Companys inability to maintain subscribers or
goodwill of the acquired businesses. In order to grow the
business, management may continue to acquire businesses that it
believes are complementary or it may seek businesses in entirely
unrelated fields. Successfully implementing this strategy depends
on our managements ability to identify suitable acquisition
candidates, acquire companies on acceptable terms, integrate their
operations and technology successfully with the Companys, retain
existing subscribers and maintain the goodwill of the acquired
business. The Company is unable to predict whether or when any
prospective acquisition candidate will become available, or the
likelihood that any acquisition will be completed. There are not,
as of the effective date, any pending acquisitions.
THE COMPANY DOES NOT INTEND TO PAY DIVIDENDS
The Company does not currently intend to pay any dividends on
its common stock. Its ability to pay cash distributions may be
restricted by covenants in any future bank credit facility.
THERE IS CURRENTLY NO PUBLIC MARKET FOR THE STOCK
The Company is not currently and never has been marketed on
any stock exchange or Nasdaq, including the OTC bulletin board
system or the pink sheets and any purchasers of the Companys
shares may find it extremely difficult to dispose of their shares.
THE PENNY STOCK RULES COULD MAKE SELLING THE COMPANYS
SECURITIES MORE DIFFICULT
Even when the Company is able to list its shares on the OTC
bulletin board, its common stock will be a penny stock, under Rule
3a51-1 under the Securities and Exchange Act, unless and until the
shares reach a price of at least $5.00 per share, we meet certain
financial size and volume levels, or the shares are registered on
a national securities exchange or quoted on the NASDAQ system.
The shares are likely to remain penny stocks for a considerable
period
of time after the offering. A penny stock is subject to Rules
15g-1 through 15g-10 of the Securities and Exchange Commission.
Those rules require securities broker-dealers, before effecting
transactions in any penny stock, to deliver to the customer, and
obtain a written receipt for a disclosure document set forth in
Rule 15g-10 (Rule 15g-2); to disclose certain price information
about the stock (Rule 15g-3); to disclose the amount of
compensation received by the broker-dealer (Rule 15g-4) or any
associated person of the broker-dealer (Rule15g-5); and to send
monthly statements to customers with market and price information
about the penny stock (Rule 15g-6). Our common stock will also be
subject to Rule 15g-9, which requires the broker-dealer, in some
circumstances, to approve the penny stock purchasers account under
certain standards, and deliver written statements to the customer
with information specified in the rules. These additional
requirements could prevent broker-dealers from effecting
transactions and limit the ability of purchasers in this offering
to sell their shares into any secondary market for our common
stock. 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. Such patterns include:
- control of the market for the security by one or a few broker-
dealers that are often related to the promoter or issuer;
- manipulation of prices through prearranged matching of
purchases and sales and false and misleading press releases;
- boiler room practices involving high pressure sales tactics and
unrealistic price projections by inexperienced sales persons;
- excessive and undisclosed bid-ask differentials and markups by
selling broker-dealers; and
- the wholesale dumping of the same securities by promoters and
broker-dealers after prices have been manipulated to a desired
level, along with the inevitable collapse of those prices with
consequent investor losses.
Additionally, the Companys securities, when available for
trading, may 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, institutions
with assets exceeding $5,000,000 or 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 spouses 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 purchasers written agreement to the transaction
prior to the sale. Consequently, the rule may affect the ability
of purchasers of the Companys securities to buy or sell in any
market that may develop.
MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
The following discussion and analysis should be read in
conjunction with the Companys Financial Statements and Notes
thereto and other financial information included elsewhere in this
Form SB-2. This Form SB-2 contains, in addition to historical
information, forward-looking statements that involve risks and
uncertainties. The Companys actual results could differ materially
from the results discussed in the forward-looking statements.
Factors that could cause or contribute to such differences include
those discussed below, as well as those discussed elsewhere in
this Form SB-2.
RESULTS OF OPERATIONS
During the period from August 19, 1999 (inception) through
June 30, 2000, the Company has engaged in no significant
operations other than organizational activities, acquisition of
the License Agreement for marketing Vitamineralherb.com products
and preparation for registration of its securities under the
Securities Act of 1933. The Company received no revenues during
this period.
For the current fiscal year, the Company anticipates
incurring a loss as a result of organizational expenses, expenses
associated with registration under the Securities Act of 1933, and
expenses associated with setting up a company structure to begin
implementing its business plan. The Company anticipates that until
these procedures are completed, it will not generate revenues
other than interest income, and may continue to operate at a loss
thereafter, depending upon the performance of the business.
LIQUIDITY AND CAPITAL RESOURCES
The Company remains in the development stage and, since
inception, has experienced no significant change in liquidity or
capital resources or stockholders equity. Consequently, the
Companys balance sheet as of June 30, 2000 reflects current assets
of $0.
The Company will carry out its plan of business as discussed
above. The Company cannot predict to what extent its liquidity and capital
resources will be diminished.
The Company may need additional capital to expand its
business. No commitments to provide additional funds have been
made by management or stockholders. Accordingly, there can be no
assurance that any additional funds will be available on terms
acceptable to the Company or at all. Irrespective of whether the
Companys cash assets prove to be inadequate to meet its
operational needs, the Company might seek to compensate providers
of services by issuances of stock in lieu of cash.
DESCRIPTION OF PROPERTY
The Company has no properties and at this time has no
agreements to acquire any properties. The officers of the Company
currently work out of space they already maintain for their other
business investments. The Companys main office will be 688 West
Hastings Street, Suite 910, Vancouver, British Columbia V6B 1P1.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
No director, executive office or nominee for election as a
director of the Company, and no owner of five percent or more of
the Companys outstanding shares or any member of their immediate
family has entered into or proposed any transaction in which the
amount involved exceeds $60,000.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
No established public trading market exists for the Companys
securities. The Company has no common equity subject to
outstanding purchase options or warrants. The Company has no
securities convertible into its common equity. There is no common
equity that could be sold pursuant to Rule 144 under the
Securities Act or that the Company has agreed to register under
the Securities Act for sale by shareholders. Except for this
offering, there is no common equity that is being, or has been
publicly proposed to be, publicly offered by the Company.
As of June 30, 2000, there were 3,500,000 shares of common
stock outstanding, held by two shareholders of record. Upon
effectiveness of the registration statement that includes this
prospectus, all of the Companys outstanding shares will be
eligible for sale.
To date the Company has not paid any dividends on its common
stock and does not expect to declare or pay any dividends on its
common stock in the foreseeable future. Payment of any dividends
will depend upon the Companys future earnings, if any, its
financial condition, and any other factors as deemed relevant by
the Board of Directors.
EXECUTIVE COMPENSATION
The Companys officers and directors do not receive any
compensation for their services rendered to the Company, have not
received such compensation in the past, and are not accruing any
compensation pursuant to any agreement with the Company.
The officers and directors of the Company will not receive
any finders fee, either directly or indirectly, as a result of
their efforts to implement the Companys business plan outlined
herein. However, the officers and directors of the Company
anticipate receiving benefits as shareholders of the Company.
No retirement, pension, profit sharing, stock option or
insurance programs or other similar programs have been adopted by
the Company for the benefit of its employees.
FINANCIAL STATEMENTS
Savannah River Group Inc.
(A Development Stage Company)
Index
Independent Auditors Report F1
Balance Sheets F2
Statements of Operations F3
Statements of Cash Flows F4
Statement of Stockholders Equity F5
Notes to the Financial Statements F6
Independent Auditors Report
To the Board of Directors
Savannah River Group Inc.
(A Development Stage Company)
We have audited the accompanying balance sheet of Savannah River
Group Inc. (A Development Stage Company) as of June 30, 2000 and
the related statements of operations, stockholders equity and cash
flows for the period from August 19, 1999 (Date of Inception) to
June 30, 2000. These financial statements are the responsibility
of the Companys management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with U.S. generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about 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. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the aforementioned financial statements present
fairly, in all material respects, the financial position of
Savannah River Group Inc. (A Development Stage Company), as of
June 30, 2000 and the results of its operations and its cash flows
for the period from August 19, 1999 (Date of Inception) to June
30, 2000 in conformity with U.S. generally accepted accounting
principles.
The accompanying financial statements have been prepared assuming
the Company will continue as a going concern. As discussed in Note
1 to the financial statements, the Company has not generated any
revenues or conducted any operations since inception. These
factors raise substantial doubt about the Companys ability to
continue as a going concern. Managements plans in regard to these
matters are also discussed in Note 1. The financial statements do
not include any adjustments that might result from the outcome of
this uncertainty.
Elliott, Tulk, Pryce, Anderson
CHARTERED ACCOUNTANTS
Vancouver, Canada
August 1, 2000
Savannah River Group Inc.
(A Development Stage Company)
Balance Sheet
(expressed in U.S. dollars)
June 30,
2000
$
Assets
License (Note 3)
Liabilities and Stockholders Equity
Current Liabilities
Accounts payable 1,200
Accrued offering costs 12,000
13,200
Contingent Liability (Note 1)
Stockholders Equity
Common Stock, 25,000,000 shares authorized with a par value
of $.001; 3,500,000 shares issued and outstanding 3,500
Deficit Accumulated During the Development Stage (16,700)
(13,200)
Savannah River Group Inc.
(A Development Stage Company)
Statement of Operations
(expressed in U.S. dollars)
From August 19, 1999
(Date of Inception)
to June 30, 2000
$
Revenues
Expenses
Offering costs 12,000
Organization expenses 3,500
Transfer agent 1,200
16,700
Net Loss (16,700)
Loss per share - basic (.01)
Weighted average shares outstanding 3,500,000
Savannah River Group Inc.
(A Development Stage Company)
Statement of Cash Flows
(expressed in U.S. dollars)
From August 19, 1999
(Date of Inception)
to June 30, 2000
$
Cash Flows to Operating Activities
Net loss (16,700)
Non cash items
Expenses not paid with cash 3,500
Accounts payable 1,200
Accrued offering costs 12,000
Net Cash Used by Operating Activities -
Cash Flows from Financing Activities
Increase in shares issued -
Net Cash Provided by Financing Activities -
Change in cash -
Cash - beginning of period -
Cash - end of period -
Non-Cash Financing Activities
A total of 3,500,000 shares were issued at
a fair market value of $0.001 per share for
organization expenses 3,500
Supplemental Disclosures
Interest paid -
Income tax paid -
Savannah River Group Inc.
(A Development Stage Company)
Statement of Stockholders Equity
From August 19, 1999 (Date of Inception) to June 30, 2000
(expressed in U.S. dollars)
Deficit
Accumulated
During the
Common Stock Development
Shares Amount Total Stage
# $ $ $
Balance - August 19, 1999 (Date of
Inception) - - - -
Stock issued for $3,500 of
organizational expenses 3500000 3500 3500 -
Net loss for the period - - - (16700)
Balance - June 30, 2000 3500000 3500 3500 (16,700)
Savannah River Group Inc.
(A Development Stage Company)
Notes to the Financial Statements
(expressed in U.S. dollars)
1. Development Stage Company
Savannah River Group Inc. herein (the Company) was
incorporated in the State of Nevada, U.S.A. on August 19,
1999. The Company acquired a license to market and
distribute vitamins, minerals, nutritional supplements, and
other health and fitness products in the State of Georgia.
The grantor of the license offers these products for sale
from various suppliers on their Web Site. In a development
stage company, management devotes most of its activities in
investigating business opportunities. Planned principal
activities have not yet begun. The ability of the Company
to emerge from the development stage with respect to any
planned principal business activity is dependent upon its
successful efforts to raise additional equity financing and
find an appropriate merger candidate. There is no guarantee
that the Company will be able to raise any equity financing
or find an appropriate merger candidate. There is
substantial doubt regarding the Companys ability to continue
as a going concern.
2. Summary of Significant Accounting Policies
3. (a) Year end
The Companys fiscal year end is June 30.
4. Licenses
Costs to acquire licenses are capitalized as incurred. These
costs will be amortized on a straight-line basis over their
remaining estimated useful lives.
5. Cash and Cash Equivalents
The Company considers all highly liquid instruments with a
maturity of three months or less at the time of issuance to
be cash equivalents.
6. Revenue Recognition
The Company recognizes revenue on a net sales basis after
the grantor of its license receives a 10% gross sales
override. Revenue will be recorded when the grantor of the
license has received cleared funds, made and paid for the
order with the supplies of the product, and the net sale is
determined by the grantor.
(e) Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues
and expenses during the periods. Actual results could differ
from those estimates.
7. License
The Company acquired a license at no cost to market
vitamins, minerals, nutritional supplements and other health
and fitness products through the Grantors Web Site. The
Company desires to market these products to medical
practitioners, alternative health professionals, martial
arts studios and instructors, sports and fitness trainers,
other health and fitness practitioners, school and other
fund raising programs and other similar types of customers
in Southern Texas. The license was acquired on February 14,
2000 for a term of three years. The Company must pay an
annual fee of $500 for maintenance of the Grantors Web Site
commencing on the anniversary date. The Grantor of the
license retains 10% of the gross sales.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
Elliott, Tulk, Pryce, Anderson has served as the Companys
independent auditor since inception, and the Company has not had
any dispute with it over accounting or financial disclosure.
PART II INFORMATION NOT REQUIRED IN PROSPECTUS
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Companys Articles of Incorporation provide for
indemnification of its directors, officers, employees and agents,
under certain circumstances, against attorneys fees and other
expenses incurred by them in any litigation to which they become
a party arising from their association with, or their activities
on behalf of, the Company. The Company will also bear the expense
of such litigation for any of its directors, officers, employees
or agents, upon such persons promise to repay the Company
therefor if it is ultimately determined that any such person
shall not have been entitled to indemnification. This
indemnification policy could result in substantial expenditures
by the Company.
RECENT SALES OF UNREGISTERED SECURITIES.
On June 15, 2000 the initial directors of the Company caused
the Company to sell 2,000,000 shares to Jason Dussault and
1,500,000 shares to Shane Lowry for $0.001 per share in
reimbursed expenses.
EXHIBITS
Exhibit 3.1 -- Articles of Incorporation
ARTICLES OF INCORPORATION
OF
Savannah River Group, 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 Savannah River Group, Inc.
ARTICLE II
The principal office of this corporation is to be at 50
West Liberty Street, Suite 880, Reno 89501, State of Nevada. The
registered office of this corporation is the same as its
principal office. 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:
H. 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.
I. 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.
J. 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.
K. 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.
L. 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.
M. 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 instrumentalities 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.
N. 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.
O. 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.
P. 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 twenty-five million shares of common
stock having a par value of $0.001 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 2.
Members whose names and post office addresses are as follows:
J.P. Beehner
PO Box 2370
Alvin TX 77512-2370
Dorothy A. Mortenson
PO Box 5034
Alvin TX 77512-5034
ARTICLE VII
The initial number of stockholders will be 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 directors 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
directors 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 directors
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.
This the 19th day of August, 1999.
Exhibit 3.2 -- By-laws
BYLAWS OF
Savannah River Group, Inc.
CONTENTS OF INITIAL BYLAWS
ARTICLE PAGE
1.00 CORPORATE CHARTER AND BYLAWS
1.01 Corporate Charter Provisions 4
1.02 Registered Agent or OfficeRequirement
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 AdjournmentNotice 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
3.00 SHAREHOLDERS MEETINGS
3.01 Action Without Meeting 9
3.02 Telephone Meetings 9
3.03 Place of Meetings 10
3.04 Notice of Meetings 10
3.05 Voting List 10
3.06 Votes per Share 11
3.07 Cumulative Voting 11
3.08 Proxies 11
3.09 Quorum 11
3.09(a) Quorum of Shareholders 11
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 12
3.14 Special Meetings 13
4.00 OFFICERS
4.01 Title and Appointment 13
4.01(a) Chairman 13
4.01(b) President 13
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 CertificatesFacsimile
Signatures 17
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 19
7.06 Fiscal Year 20
7.07 Waiver of Notice 20
8.00 ADOPTION OF INITIAL BYLAWS 20
ARTICLE ONECORPORATE CHARTER AND BYLAWS
1.01 CORPORATE CHARTER PROVISIONS
The Corporations 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 OFFICEREQUIREMENT 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,
#880, Reno NV 89501.
The name of the Registered Agent of the
Corporation at such address, as set forth in
its Articles of Incorporation, is: The 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: PO Box 5034, Alvin TX 77512-
5034.
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 TWODIRECTORS 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 Presidents 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 COMMITTEESAUTHORITY 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 2. 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 THREESHAREHOLDERS 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 the holders of 51% of
shares which 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
Corporations 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 Shareholders 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
Shareholders 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 Presidents
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 Secretarys 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 FOUROFFICERS
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. Any two or more offices, including
President and Secretary, may be held by one
person. 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:
(17) 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
Secretarys 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.
(18) Keep the minutes of corporate
meetings, and the Corporate Record Book, as set
out in Section 7.01 hereof.
(19) Maintain, in the Corporate Record
Book, a record of all share certificates issued
or canceled and all shares of the Corporation
canceled or transferred.
(20) Be custodian of the Corporations
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.
(21) 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:
(22) 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.
(23) Receive, and give receipt for, monies
due and payable to the Corporation.
(24) 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.
(25) 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 Treasurers office and the
restoration to the Corporation of all corporate
books, papers, vouchers, money, and other
property of whatever kind in the Treasurers
possession or control, in case of the
Treasurers 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.
(26) 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 FIVEAUTHORITY 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 pecuniarily 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 persons 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 SEVENCORPORATE 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 Corporations 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 Corporations 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
Directors or Shareholders 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 Corporations 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 Corporations
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 VIII ADOPTION OF INITIAL BYLAWS
The foregoing bylaws were adopted by the Board of Directors
on August 19, 1999.
_/s/ J. P. Beehner_____________________
J.P. Beehner
__/s/ Dorothy A. Mortenson______________
Dorothy A. Mortenson
Attested to, and certified by:
/s/ Dorothy A. Mortenson
Secretary
Exhibit 5.1 -- Opinion re: legality
Savannah River Group, Inc.
688 West Hastings
Suite 910
Vancouver, BC V6B 1P1
Canada
July 31, 2000
Re: Savannah River Group, Inc. Registration Statement on
Form SB-2
Ladies and Gentlemen:
We have acted as counsel for Savannah River Group, Inc., a
Nevada corporation (the Company), in connection with the
preparation of the Companys registration statement on Form SB-2
filed with the Securities and Exchange Commission relating to the
public offering of up to 1,000,000 shares of the Companys public
stock pursuant to the Securities Act of 1933. This opinion is
being furnished pursuant to Item 601(b)(5) of Regulation S-K
under the Act.
In rendering the opinion set forth below, we have reviewed:
(a) the Registration Statement and the exhibits thereto; (b) the
Companys organizational documents and minute books, and; (c) 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
such other examinations of law and fact as we have deemed
relevant in order to form a basis for the opinion hereinafter
expressed.
Based upon the foregoing, we are of the opinion that the
Companys shares are validly issued, fully paid and nonassessable.
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 on the
Registration Statement.
Very truly yours,
ROGER L. SHOSS
/s/Roger L. Shoss
Exhibit 10.1 -- License Agreement
LICENSE AGREEMENT
THIS LICENSE AGREEMENT (Agreement) is made and effective as of
February 14, 2000 by and between David R. Mortenson & Associates,
a Texas general partnership (DRM), and Savannah River Group, Inc.,
a Nevada corporation (Licensee), with reference to the following
facts:
A. 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.
B. Licensee desires to market the Products to medical
professionals, alternative health professionals, martial
arts studios and instructors, sports and fitness trainers,
other health and fitness practitioners, school and other
fund raising programs and other similar types of customers
(Customer(s)) in the Territory, as hereinafter defined.
Customers will be able to buy the Products on a continuing
basis through Vitas Web Site.
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 Product(s) to be ordered through
Vitas Web Site. The parties agree that Exhibit A will be
amended from time to time to include similar information
with respect to any future orders of the same product or
orders of future Product(s) ordered through Vita by DRM or
by Sub-licensee(s) or Customers. Pricing may be amended
from time to time on the Web Site. The price posted on the
Web Site at the time of order shall prevail. 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 state
of Georgia DRM grants to Licensee the exclusive rights to
market the Products in the Territory through the Web Site.
3. Manufacture of Products. All Products marketed through
Vitas Web Site shall be manufactured, packaged, prepared,
and shipped 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 Products 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. Products shall be labeled with Standard
Labels, except for Private Label Products, as described
herein. Standard labels shall contain all information
necessary to conform to regulatory and industry
requirements.
5. Private Label Products. Vitamins, minerals, herbs, and
nutritional supplement products may be available for sale
with labels customized for Customer (Private Label
Products). DRM shall cause supplier to affix labels to the
Private Label Products which have been furnished by Customer
which are consistent with suppliers labeling equipment and
meet all federal and/or state labeling requirements for the
Private Label Product(s) ordered. Pricing for Private Label
Products shall be as determined by supplier and posted on
the Web Site at the time of order.
6. Shipping. Shipping shall be by UPS ground unless Customer
requests and pays for overnight shipping by UPS. Shipping
and handling fees for overnight shipping will be posted on
the Web Site. The price shall be the price posted on the Web
Site at the time of order. All orders from suppliers stock
shall be shipped within seventy-two (72) hours of receipt of
order. Items not in stock (back orders) shall be shipped on
a timely basis, but not later than four to six weeks from
time of order.
27. Products and Pricing. The initial pricing for the Product(s)
is set forth on Exhibit A and may be amended from time to
time, and such amendments will be posted on the Web Site. Terms
are payment by credit card or electronic funds transfer at time
of purchase.
28. Minimum Order Quantities for Vitamin, Mineral, and/or
Nutritional Supplements. The minimum order quantity is 100
bottles per formulation for standard Products. Customer
Formulas, as defined herein, shall have minimum purchase
quantities of 5,000 units.
9. Web Site Maintenance; Fees. Vita will maintain Vitas Web
Site (the Web Site). The Web Site shall post current
prices for all Products. Customers will be able to
obtain unique identification codes (Userid(s)) and
select passwords on the Web Site. The Web Site will be
operated in a manner that ensures secure Internet financial
transactions. Licensee shall pay Vita a maintenance fee of
$500 yearly, beginning on the anniversary date of this
Agreement, for maintenance of the Web Site.
10. Orders. All Products shall be ordered through the Web Site.
In jurisdictions in which sales tax would be collected
on retail sales of the Products, Licensee shall ensure that
each Customer provides a sales tax ID number for exemption
from sales tax. Licensee shall assist its Customer to
register on the Web Site. Each Customer shall be issued a
Userid and shall select a password upon registration. Upon
ordering, Customer must pay for Product by credit card,
debit card, or by electronic funds transfer (e-check) and
all funds will be remitted to Vita. Upon receipt of order,
Vita will email the supplier to purchase the Product(s)
ordered. Supplier will drop-ship the order directly to
customer in accordance with Section 7,Shipping.
11. Override; Payment to Licensee. Licensee agrees that Vita
shall retain a 10% override on gross sales made through
the Web Site by Licensee. Vita agrees to pay supplier
for the Product purchased upon receipt of cleared funds.
Vita will retain its override and will remit the balance to
Licensee by the tenth day of the month following sales. Vita
further agrees to provide Licensee with a Monthly Sales
Report of all sales made by Licensee through the Web Site
detailing the purchases from each Customer. Vita will e-
mail the Monthly Sales Report to Licensee by the tenth day
of the month following such sales.
12. Warranties and Indemnification. DRM warrants that all
Products, including Joint Formula Products but not
including Customer Formula Products, shall be fit for the
purpose for which produced and shall be in full and complete
compliance with all local, state, and federal laws
applicable thereto. DRM warrants that all Custom Products
shall be manufactured in accordance with Customers
specifications. DRM warrants that all non-Private Label
Products shall be correctly and accurately described on each
label affixed thereto, and that all labeling affixed thereto
shall be in full and complete compliance with all local,
state, and federal laws applicable thereto. DRM warrants,
covenants and certifies that its supplier(s) manufacturing
facilities comply with applicable federal, state, city,
county, and municipal laws, rules, regulations, ordinances,
and codes in all material respects. DRM hereby agrees to
indemnify, hold harmless and defend Licensee, its Customers,
Buyers, affiliates, directors, officers, agents and
representatives from and against any loss, claim, and
expense (including attorneys fees and costs, and costs of a
recall of Product) incurred or suffered as a consequence of
DRMs breach of its product warranties as set forth herein.
13. Nature of Relationship. (a) This Agreement does not
constitute nor empower the Licensee as the agent or legal
representative of DRM 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.
14. 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.
15. 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 written notice of
termination to the other party ninety (90) days prior to the
end of the term. Licensee may terminate this Agreement
for any reason at any time upon ninety (90) days written
notice to DRM. In the event of a material breach of this
Agreement, the non-breaching party may provide written
notice of breach. Upon notice from the non-breaching party,
the breaching party shall have fourteen (14) days to cure
the breach, after which period, if not cured, the Agreement
shall be automatically terminated. 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.
16. 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.
17. 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 partys
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.
29. Governing Law; Dispute Resolution. This Agreement shall be
governed by Texas law in accordance with the Dispute Resolution
Agreement attached hereto as Exhibit B.
30. 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. David 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
If to Licensee: Savannah River Group, Inc.
P. O. Box 5034
Alvin TX 77512-5034
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.
Savannah River Group, Inc.
a Nevada corporation
By:
J. P. Beehner, President
/s/ J.P. Beenher
DAVID R. MORTENSON & ASSOCIATES
a Texas General Partnership
By _________________________________
David R. Mortenson, General Partner
/s/David R. Mortenson
EXHIBIT A
PRODUCT SPECIFICATIONS
In the event of any inconsistency between the terms of Customers
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 IFMs 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
February 14, 2000 by and between David R. Mortenson & Associates,a
Texas general partnership, and Savannah River Group, Inc., a Nevada
corporation.
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 February
14, 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).
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
DRMs 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.
A. There shall be a single mediator. If the parties cannot
agree upon an acceptable mediator within ten (10) days of
termination of the negotiation, each party shall select one
mediator from a list of not less than five (5)mediators
provided by the other party. These two mediators shall
select a third mediator who shall serve as the sole
mediator.
B. 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 held in
Houston, Texas. 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.
4. 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 Houston, Texas. The arbitration shall be governed by the
laws of the State of Texas and the following provisions,
which shall supersede the Texas rules of civil procedure 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. 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. Attorneys 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 andshall not
change any such terms or provisions or deprive eitherparty
of any right or remedy expressly or impliedly providedfor
in the Agreement. The arbitrator(s) shall apply the lawof
the State of Texas or federal law, in those instancesin
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 partys 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 Harris, Texas or
the federal court for the Southern District of Texas.
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
Savannah River Group, Inc.:
J. P. Beehner
3030 FM 518 Apt 221
Pearland, TX 77584-7817
Fax: 281-331-9442
Phone: 713-436-2787
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.
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.
Savannah River Group, Inc. David R. Mortenson & Associates
a Nevada corporation a Texas General Partnership
By: By:
Title: President Title: General Partner
Exhibit 23.1 -- Consent of Independent Auditors
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the captions
Accountants On Accounting And Financial Disclosure and Interests
Of Named Experts And Counsel and to the use of our report dated
August 1, 20000, in the Registration Statement (Form SB-2) and
related Prospectus of Savannah River Group Inc. for the
registration of shares of its common stock.
Our audit also included the financial statement schedule of
Savannah River Group Inc. This schedule is the responsibility of
the Companys management. Our responsibility is to express an
opinion based on our audit. In our opinion, the financial
statement schedule referred to above, when considered in relation
to the basic financial statements taken as a whole, presents
fairly in all material respects the information set forth
therein.
Elliott, Tulk, Pryce, Anderson
CHARTERED ACCOUNTANTS
Elliott, Tulk, Pryce, Anderson
POST-AMENDMENT FILINGS
The Company hereby undertakes to file a post-effective
amendment to this registration statement during any period in
which it offers or sells securities pursuant to Rule 415, and
will include an updated prospectus with such amendment as
required by the Securities Act.
SIGNATURES
In accordance with the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements of filing on Form
SB-2 and authorized this registration statement to be signed on
its behalf by the undersigned, in the City of Vancouver,
Provincepf British Columbia, Canada on August 12, 2000
(Registrant)
Savannah River Group, Inc.
/s/ Savannah River Group
In accordance with the requirements of the Securities Act of
1933, this registration statement was signed by the following
persons in the capacities and on the dates stated:
(Signature)
By (Signatures and Title)
Shane Lowry, President and Director
/s/ Shane Lowry
Jason Dussault, Secretary/Treasurer and Director
/s/ Jason Dussault
August 16, 2000