dynapharm business manual

DYNAPHARM

BUSINESS MANUAL

DYNAPHARM INTERNATONAL PHILS., INC.

DYNAPHARM

Table of Contents

The Dynapharm Business Manual: A Preface......................................... 2

Dynapharm Professional Ethics .............................................................. 3

Section 1 – Definitions ............................................................................ 4

Section 2 – The Independent Distributor ................................................ 8

Section 3 - Distributorships Operations & Termination ....................... 10

Section 4 - Purchase & Sale of Products .............................................. 14

Section 5 – Advertising, Trademark & Copyrighted Materials ............ 19

Section 6 – Distributor Compensation & Fees ..................................... 25

Section 7 – General Provisions ............................................................. 27

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The Distributor’s Rules and Regulations

A Preface

This Business Manual conferred by Dynapharm specifies the complete policies and Procedures as biding and effective as of December 1, 2004. It underscores the fundamentals to lead the Distributors in conducting their business transactions with the Company, with the fellow Distributors, and most importantly with end –users and/or retail-customers.

Given the dynamic character of the Company, certain provisions stated herein can be revised or amended to suit the over-all corporate goals. The amendment shall be appropriately communicated to all concerned and shall be enforced and in effect after it has been published in the official organ of the Company, website and/or through distributed copies of the revised Policies and Procedures and other Notice of Inclusions.

The Dynapharm Compensation Plan, the Distributor Application Form (DAF) and this Business Manual (the” Policies and Procedures”) encompass the complete contract between the Company and Distributors with a thorough understanding and adherence to the Policies and Procedures. With this, everyone is enjoined to study, understand and strictly abide by the provisions of the Business Manual.

Carlo Ll. MayugaPresident and Chief Executive OfficerDynapharm Int’l Philippines, Inc.

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Dynapharm Professional Ethics

I shall abide with the contract at all times as adhered by the Company.

I shall perform my business in a manner that will enhance not only my reputation but of the company as a whole.

I shall be courteous, honest and fair to every person I contact in the course of my Dynapharm distributorships activities.

I shall fulfill my leadership responsibilities as a Sponsor by training, assisting and supporting the Distributors in my sales organization.

I shall respect the Sponsor relationship of every Distributor in the Dynapharm family, and I will neither attempt to complicate or change these relationships nor make any disparaging remarks or allegations about Dynapharm, its affiliates and Distributors.

I shall not misrepresent any Dynapharm products and its Compensation Plan that is not enclosed in and supported by the current Dynapharm publications and/or literature.

I shall remember that even my personal experience & the benefits received from Dynapharm products, services or program, may be interpreted as unauthorized “extensions of labeling” claims if I use them as a sales device.

I shall not sponsor any Dynapharm Distributors into any other network-marketing program nor shall I engage in any deceptive or illegal practice. Doing so could mean the termination of my Distributorships.

I understand and agree that I am solely responsible for all financial and/or legal obligations I may incur in the course of my business as an independent Distributor of Dynapharm products and/or services.

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Section 1 Definitions

I. Distributor Agreement It is legal contract biding the Distributor and Dynapharm that constitutes

professional business arrangements. The Distributor Agreement Form should be completed by the person or entity applying to become a Dis-tributor and is subject to acceptance or rejection of Dynapharm.

II. Distributor An individual, partnership or corporation who has completed the reg-

istration process with Dynapharm is considered an official Distributor. The registration process is completed once the Distributor Application Form is completely signed and has been accepted by the Dynapharm. A Dynapharm Distributor is entitled to purchase products at a special Distributor’s price.

III. Active Distributor A Distributor who has a minimum Personal Sales Business Volume

(PSBV) of 1,000 within the given volume month is considered active. An active Distributor is eligible to receive earnings under the compensa-tion plan

IV. Retail Customer Retail customers are end-users who purchase Dynapharm products from

a registered Dynapharm Distributor, Dynapharm Pick-up Center or di-rectly from the company. A retail customer is not qualified to benefit from the Compensation Plan. The Business Volume (BV) generated from the products they purchase forms part of the Distributor who sold the products to them.

V. Personal Sponsor A Dynapharm Distributor who personally recruits a non - distributor to join his/her specific organization.

VI. Upline A Distributor’s sponsor and successive sponsors up through the organi-

zation.

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VII. Downline A Distributor or group of Distributors directly or indirectly linked to an

upline. VIII. Downline Organization Your downline Organization comprises all Distributors who are under

your line of Sponsorship, from the first to the last level of your down-lines.

IX. Frontline A Distributor who is immediately positioned below the sponsor in the

Sponsor’s genealogy or line of sponsorship.

X. Level A relative position in a Distributor’s downline grouped horizontally,

based on Sponsorship without compression.

XI. Commission Earnings paid by Dynapharm to its qualified Distributors as determined

by the business volume of products purchased or retailed by the Dis-tributor and the Distributor’s downline as indicated in the Compensation Plan.

XII. Commission Generation Earnings computed as percentages of the total BV of a Distributor’s

downline levels. The depth (of levels) by which the Distributors are paid based on the rank achieved.

XIII. Business Volume The points or credits assigned to a Dynapharm product as indicated in

the Dynapharm Distributor’s price list.

XIV. Volume Month The calendar month (with specified cut-off dates) used to determine

ranks and bonus earnings under the compensation plan. A Distributor’s application when accepted by Dynapharm in a given calendar month shall be considered as the first volume month.

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XV. Cut-Off Date The deadline for product orders is every end of the month. Purchases

made after this date are credited onto the next volume month.

XVI. Personal Sales Business Volume (PSBV) The total BV of the products personally purchased by a Distributor in a

given volume month. This may also include the BV generated from the retail sales of a Distributor.

XVII. Personal Group Business Volume (PGBV) The sum of a Distributor’s BV and his non-manager’s BV in a given

volume month. This may also be referred as the organizational volume of a Distributor.

XVIII. Monthly Maintenance This refers to the required minimum PSBV and/or PGBV for Distributor

to qualify for commissions and achieve a certain rank.

XIX. Qualify To “Qualify” is to earn a given rank or benefit in a given volume month.

XX. Qualifying Month The volume month in which a Distributor meets the requirements for a

given rank or benefit.

XXI. Leg The Vertical organization that begins from one of your frontline Dis-

tributor down to your frontline’s last level. Each frontline together with its downlines corresponds to a separate leg.

XXII. Leg Volume The total organizational volume of a leg.

XXIII. Personal Rebates The commission earned generated from a Distributor’s personal pur-

chases and retail sales in a given volume month. A Distributor must have at least 500PSBV to qualify for personal rebates.

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XXIV. Rank A qualification title in the compensation plan.

XXV. Retail Profit The difference between the wholesale price that a Distributor pays for

a Dynapharm product and the price that the Distributor charges the cus-tomer.

XXVI. Dynamic Compression Is the process of considering any given Distributor to be on the frontline

of the first upline. If a Distributor has zero BV, the Distributor’s frontline is vertically compressed to the first upline with greater than zero BV.

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Section 2 The Independent Distributor

All Distributors are independent contractors with Dynapharm. They are not considered as purchasers of franchise, joint ventures, partners, employees, or agents of the company. Distributors have no authority to make any representation, agreement, or commitment of any kind for or on behalf of Dynapharm or to bind Dynapharm in any manner.

I. Legal Compliance & Taxation Each Distributor shall comply with all national or local laws, regulations

or ordinances concerning the operation of their business. Distributors are responsible for their own managerial decisions and expenditures, in-cluding but not limited to the filing of their own income, VAT and other tax returns, and registration of their “employees” with the Social Secu-rity System or with any applicable government body present in the state where they conduct their business. Dynapharm shall not be responsible for any damage or injury to a Distributor or to any third person with re-spect to the management or operation of the Distributor’s business

II. Distributor Enrollment Any person of legal age can become a Dynapharm Distributor when both

of the requirements are met:

The applicant purchased a business kit, and Submission of the applicant’s completed application or agreement form to Dynapharm home officer or pick-up center.

Once the application has been processed, an identification number will be assigned to each Distributor.

Incomplete, inaccurate, or unlawful Distributor Agreements are void. Dynapharm reserves the right not to provide reasons for the acceptance or rejection of an application form.

Corporations, partnerships, trust, sole proprietorships and other entities may become distributors ONLY when the completed application form

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is accompanied by notarized copies of the Articles of Incorporation, By-laws, Partnership Agreement, Trust Documents and Business Reg-istration Certificates as filed with government agencies. Furthermore, Distributors must disclose a complete list of all directors, officers and shareholders involved in the corporation. Partnerships must disclose all general and limited partners. Trust must disclose the trustee(s) and ben-eficiaries.

The application must be signed on behalf of the Corporations, Partner-ships and Cooperatives by an authorized officer or partner and must be signed individually by each of the shareholders of the Corporations, part-ners of the Partnerships or officers of the Cooperative.

III. Beneficial Interests A person included in a partnerships, corporation, trust and other busi-

ness entities shall not be enlisted to more than one Distributor entity to have a beneficial interest.

If such a proceeding was discovered or the Distributor application was accepted (as the case maybe), the company at its sole discretion can terminate the distributorship any time. Dynapharm is not liable to any loss that may be incurred in the process.

IV. Distributors Rights All Distributors are authorized to purchase Dynapharm products at

distributor’s price, sell them (at suggested retail prices), and participate in the Compensation Plan.

V. Account Information Changes Submitting a new Distributor agreement form with the word “AMEND-

MENT’ written at the top to the Distributor Compliance Section can be done to effect account changes, corrections, or updates to the Distribu-tor agreement.

VI. Married Couples Married couples and their dependent children must share a single dis-

tributor entity. Both applicants must sign Distributors application. Single Distributors who marry may elect to maintain separate Distributor status unless one is the direct sponsor of the other in which case their Distribu-tor status must be consolidated.

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Section 3 Distributorship Operations & Termination

All Distributors are expected to perform all of their business activities in a professional and ethical manner, which shall enhance the Distributor’s reputation and that of the company. Distributors shall not engage in any conduct, which would negatively reflect on Dynapharm, or any other Distributor’s image.

I. Sponsoring Distributors are entitled to sponsor other Distributors in the Philippines

and other countries as officially opened by the company into the Dy-napharm Ambassador Program. However, Distributors are compensated only for the generation of sales of products and not for sponsoring new Distributors.

A Distributor shall not solicit sponsor employees of Dynapharm or mem-bers of the employee’s household to the Dynapharm Distributors during the term of their employment. The same shall apply for any Dynapharm consultants, product suppliers, and agent representatives. This is to avoid conflicts of interest, and to further a Distributor’s respect of the confiden-tiality and neutrality of Dynapharm employees.

II. Multiple Applications If an applicant submits more than one Application or Agreement forms

listing multiple sponsors, only the first/original completed and accepted form (by the company) shall be honored. Dynapharm reserves the right at its discretion, to make the final decision with respect to all such dis-putes.

III. Unfair Competition and Cross Sponsoring A Distributor may not solicit or attempt to neither Sponsor another

Dynapharm Distributor nor engage in indiscriminate advertising that solicits purchasing of competitive non-Dynapharm products or participation into any other network-marketing or direct-selling company with the exception of those individuals the Distributor has personally sponsored without the written consent of the company. However, the

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consent granted may be revoked with reasonable notice at the discre-tion of Dynapharm. The above-mentioned prohibited acts are regarded as unfair competition with Dynapharm and are also regarded as “Cross-Sponsoring” Cross sponsoring may be grounds for termination.

IV. No Exclusive Territories There are no exclusives territories for recruiting purposes, nor shall any

Distributor imply or state that he or she does have an exclusive terri-tory. There are no geographical limitations on Distributor sponsoring within any country except those in countries not officially opened by Dynapharm.

V. Training Requirement Distributors are required to assure the adequate training of Distributors

they sponsor. “Adequate training” shall include, but not limited to, edu-cation regarding the Distributor Agreement, the business manual, and the Compensation Plan, and other important information (about prod-ucts, ect.) as well as relevant activities (i.e. initiating periodic contacts for the purpose of training & motivating new recruits, sales or distribu-tive function in the sale/delivery of product & services to end user.

VI. Lead Distribution Potential Distributor leads that went directly to Dynapharm will be re-

ferred to Distributors. The company shall conduct ample line of investi-gation to determine how a prospect became interested with the company and the distribution of such leads is made at the sole discretion of Dy-napharm.

VII. Distributor Divorce or Partnership Dissolution If married Distributors or partners who share in a Distributorship obtain

a legal separation or wish to dissolve their partnership, Dynapharm will continue to honor the Distributorship pursuant to the original Distributor Agreement until such time that Dynapharm receives written notice from both parties or a certified court order documenting this change. The writ-ten notice must be signed by all parties and notarized. Such notice will be subject to final action of Dynapharm. Legally separated Distributors or dissolved partnership are required to submit a certified true copy of any legal judgment, decree, or agreement. This will guide the manner how payments of commission checks shall be done in the future.

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VIII. Distributor Death At the date of a Distributor’s Death, the Distributorship may be assigned

to the Distributor’s heirs, successor or trustees. In such proceedings, the death certificate along with a certified copy of the will or court order, as well as the amended Distributor Agreement in the name of the Distribu-tor receiving the distributorship should be submitted to Dynapharm. If the concerned parties did not advise the company within six (6) months after the Distributor’s death, this would mean non-transferability of the Distributorship.

IX. Status Changes & Transfer Transfer of Sponsorship is RARELY PERMITTED and is ACTIVE-

LY DISCOURAGED. Maintaining the integrity of Sponsorship is abso-lutely mandatory for the success of the entire organization. Any assign, acquire of interest, or otherwise transfer of a Distributorship or Sponsor-ship; a Distributor must follow the Company procedures.

The following instances may result in the approval of such changes:

In the case of unethical (or fraudulent) sponsoring, Dynapharm may, in its sole discretion, make such changes in the sponsor or upline of a Distributor, as it deems appropriate.

Dynapharm receives a written request, accompanied by signed letters of approval from all the upline sponsors, up to and including the highest ranked upline sponsor (Crown Diamond Manager) and a fee of US$100. The form should clearly state that all parties involved understand the consequences of the sponsoring change.

A Distributor voluntarily terminates his/her Distributorship is eligible to apply for a new Distributor Agreement and sign under when:

Existing Distributorship but maintains no activity for a period of Twelve (12) months, other than a retail customer relationship.Existing and Active Distributors who voluntarily resigns.

In any such changes, only the distributor who has petitioned for a change in sponsorship shall be moved. All other downline Distributors shall re-main in the original set-up

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X. Voluntary Termination (Resignation) An Active Distributor may voluntarily terminate one’s distributorship

at any time by sending a written notice to Dynapharm, indicating the Distributor’s name(s) and ID number (s). A Distributor who voluntarily terminates an Agreement must wait (6) months before re-applying for a new Distributorship.

XI. Involuntary Suspension or Termination Dynapharm may involuntary suspend or terminate the status of any Dis-

tributor for cause that may include but is not limited to the following:

a) Any violation of the Contract (Distributor Agreement, Business Manual) of which may be amended from time to time.

b) Any unlawful/wrongful act or mis-conduct, which may reflect ad-

versely on Dynapharm and its Distributors.

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Section 4 Purchase & Sale of Products

I. Ordering, Receiving and Payments Guidelines A Distributor may order products by placing an order with Dynapharm

and make the corresponding payment. Funds must be available at the time the order is placed. Orders may be withheld until the availability of funds is verified. The Business Volume (BV) for any order shall be credited to the Volume Month only upon receipt of payment.

Orders will be accepted at the Dynapharm office from Monday’s to Fri-days until 5PM. All mailed/faxed orders can either be picked-up or de-livered to Distributors preferred address. It is the responsibility of the Distributors to indicate the destination address. The cut-off time stated previously also applies for orders set for delivery or shipping (i,e. Dy-napharm pick-up centers (DPC), requesting Distributor) to allow a rea-sonable time for processing or packaging.

Note: Such orders cannot be sent through P.O. Boxes.

Orders shall be shipped within 24, 48 or 72 hours (depends on desti-nation) after receipt of order. If a product is temporarily out of stock, a Distributor shall receive a backorder notice along with the shipment. All backorders will only be collected personally at the Dynapharm of-fice or Dynapharm pick-up center (DPC). Proof of purchase (I, e. sales invoices, receipts, etc.) must be presented when claiming backorders.

Upon receipt of an order, Distributors shall immediately inspect the order to determine whether it is complete and in good condition.

If an order is incomplete and that a backorder notice is not attached, the Distributor should immediately inform the Dynapharm Sales & Operations (S&O) Dept. or the DPC where they get their products.

If the forwarder or courier company is responsible for the damage, which occurs after it takes physical custody of the goods. The Distributor who receives the damaged goods should follow this procedure:

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1. Accept the delivery.2. Document on or take note of the delivery receipt, and the number of

boxes, which appear to be damaged.3. Notify the forwarder or courier company to have the damage goods

inspected. Do not forget to save the damaged product(s) and box (es) for inspection.

4. Notify Dynapharm Sales & Operations Dept. (S&O) of such inci-dent so we can file a claim with the forwarder or courier company.

In the event that a package is returned due to a Distributor’s error or if the package was not picked up in a timely manner and therefore returned, Dynapharm will charge the Distributor a re-shipping fee.

Before assuming a shipment is lost or missing, a Distributor should wait ten (10) working days from the placement of mailed orders and five (5) working days from orders placed through fax ( or the internet ) Lost shipments when found and/or delivered must be reported to the S & O within three (3) after receipt.

All Dynapharm products must be store in a cool, dry, and hygienically safe area or as other wise directed on the product label. As a general rule, the products should be kept at least (4”) inches above the floor. Dynapharm is not responsible for products damaged due to improper storage.

Products can only be bought on CASH BASIS or ON-US Check/s

Personal check payment are only accepted on a case-to-case basis and largely depends on the good standing record of the Distributor and is subject for clearing before the products can be released.

A Distributor who has had at least one check for “Insufficient funds” or “closed account” may lose any or all privileges until all payments are completely credited.

In case of Corporations, Partnership and Cooperatives, by executing the Application and Agreement, it is expressly understood that in case of any court litigation borne out of violation of this Business Manual like in the case of “non-payment” of Sales Reports and/or Product Purchase, the authorized officer or partner will be held liable for any legal action that may arise from the agreement.

A Distributor agrees that he is not entitled to a refund for products released.

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II. Direct Purchase All Dynapharm Distributors may purchase products directly from Dy-

napharm’s Head Office, Branches or authorized Dynapharm Pick-up Centers. If a Distributor has acquired products from his sponsors or upline distributors personal inventory and a replacement product is not placed with Dynapharm, no commission or overrides shall be paid in such transactions.

III. Consignment To protect your Dynapharm business and the honor of the company, Dy-

napharm products may not be delivered to any Distributors or another party on consignment. Only authorized Dynapharm Distributors and Dynapharm pick-up centers may sell Dynapharm products to an outside party.

IV. Product Buy-Back or Returns The products that can only be returned are those personally purchased by

the Distributor himself and are found in the order history of the distribu-tor returning products.

All unused and resalable products can be returned to Dynapharm along with proof of purchase within seven (7) days from the date of purchase. The Company shall offer an exchange of the same product/s. The same rule shall apply when a Dynapharm Distributor has a customer who wish-es to return product(s). The distributor shall be accountable in giving the refund of the customer at first, accomplish the corresponding form (Re-turn/Exchange Form) and submit the request to the Sale & Operations Department. If the distributor fails to refund his customer, the distributor is responsible in repaying the company for any amount refunded as well as handling fee.

In cases where a Distributor is requesting for a full refund of money for unsold, marketable product(s), this shall be considered as his inten-tion of voluntarily terminating one’s distributorship. Dynapharm shall refund ninety percent (90%) of the net cost to the distributor, less any applicable charges (shipping, taxes, etc.) Incurred in the purchase of the

All prepaid orders placed which has not been entered in the system before the cut-off date shall be processed and will be included in the current Volume Month or on the Month where the order was placed or received by Dynapharm.

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product compensations received (i.e. commissions, bonuses, incentives) and commissions earned by the up-lines for returned products(s). If the uplines are no longer active and that there would be no means for the company to deduct such commissions previously released.

Products shall not be considered as marketable/reusable under the fol-lowing conditions.

If returned four (4) months before the products expiration date, unusable, or shelf-life period had passed.

The company has directly informed the distributors, prior to purchase, that the products are discontinued or categorized under special promotions.

This Distributor returning the products is responsible in paying the ship-ping costs and for any damage or loss in the shipping process. Dynapharm will reject goods, which were damaged during transit, and are considered not resalable. After all required documents and returned items have been verified, the company shall issue the terminating Distributor a refund based on the method of payment.

V. Commission Adjustment Any up-line distributor affected by returned products is subjected to

adjustments in their commissions, overrides and business volume, etc. based upon all commissions and bonuses paid on the returned products. Adjustments can also be done in such a case, where wrong volume was entered in the system. Likewise, required documents (cash sales invoice, provisional receipts) should be presented to facilitate adjustments ac-cordingly.

VI. Excessive Purchases Prohibited Dynapharm Distributors may purchase products from Dynapharm, other

Dynapharm Distributors or through pick-up centers in amounts which are reasonably necessary and appropriate to establish and maintain an inventory of products for resale to retail customers, to other Dynapharm Distributors in their organization, and for personal use and consumption. However, the company strictly prohibits the purchase of products solely in an attempt to qualify for advancement under the compensation plan, or for qualification for any bonus or award. Such act (commonly known as frontloading) may be grounds for suspension or termination.

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VII. Bonus Buying Prohibited Bonus buying may include but is not limited to the following:

Enrollment of a Dynapharm Distributor without the knowledge of an individual or entity concerned is considered fraudulent.

Enrollment or attempted enrollment of a non-existent individuals or entitles as a Distributor.

Bonus buying represents a substantial violation of this Business Manual that may result to distributorship termination.

VIII. Price Change Dynapharm reserves the right to change the prices of any or all of its

products and literatures at any time with prior notice.

IX. Distributors and Customers Price A Distributor may not sell Dynapharm products below the stated offi-

cial Distributor’s price. The company shall provide the current product listings, which is available at Dynapharm HO, Branches and Pick-up Centers. This list (together with any BV assigned to the product) forms the basis for the discounted purchase price at which Distributors may purchase products from the company, and may assist in product pricing for retail (customer) sales. Likewise, a Distributor is not allowed to ad-vertise at any price below Dynapharm’s suggested retail price.

X. BV Transfers Business Volume transfers from one Distributorship to another are not

permitted.

XI. VALUE ADDED TAX (VAT) Dynapharm products are subject to value added and sales tax. When Dy-

napharm collects and remits such mandatory taxes, the company shall advise Distributors that such taxes are required to be collected on their behalf. The collection of taxes by Dynapharm does not relieve the Dis-tributors of their own personal responsibility and duty to comply with other applicable tax laws and regulations.

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Section 5 Advertising, Trademark and Copyrighted Materials

Dynapharm is a Multi-Level Company, which uses a more powerful form of advertising than other mass-marketing techniques, the “word of mouth”. The person-to-person contact that you will establish is the most effective means of advertising that you can supplement and support your Dynapharm business.

I. Advertising Dynapharm encourages its Distributors to promote Dynapharm prod-

ucts and marketing opportunities pursuant to appropriate directives and guidelines issued by the company from time to time. These guidelines are required to ensure compliance by distributors as well as by Dynapharm, with laws that govern advertising of the products and opportunity of Dy-napharm. Failure to follow such guidelines may result in violation of local and national laws that may adversely affect the reputation of the company, its distributors, and its products leading to undesirable public-ity and even possible legal action.

Distributors may not use any electronic media advertising materials or the advertising of Dynapharm or its products on television, radio or the Internet without the prior approval of Dynapharm. A Distributor agrees to send any self-produced promotional items or materials to the Business Development Dept. for written approval.

Dynapharm may allow a Distributor to use Dynapharm names, logos or trademarks or copyrighted materials after obtaining prior written permission to do so. Any advertising misrepresentation contained in a “blind” ad (one in which neither Dynapharm nor its products is mentioned) may be regarded as a violation of these policies.

II. Copyrighted Materials All Dynapharm literature, audio tapes, video tapes, internet materials,

and programs are copyrighted by Dynapharm and may be duplicated only by obtaining the prior written consent of Dynapharm.

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III. Company Literature Distributors shall actively participate with Dynapharm to notify every-

one concerned regarding new information particularly referring to up-dated policies, forms, and brochures, or other literatures. Distributors should discard obsolete or invalid literature and forms. The company is not obligated to reimburse any Distributor for these obsolete materials in the Distributors possession.

Reproduction of these materials in part or in whole including but not limited to layout and pictures is not allowed.

IV. Proprietary Names & Trademarks A Distributor may not use Dynapharm employee name(s), trademarks,

logos, trade names or any distinctive phrases or slogans used by Dy-napharm to promote the Distributor’s business prior to receiving the written permission from Dynapharm.

A Distributor shall not obtain, through filing for a patent, trademark, In-ternet domain name, or copyright, any right, title or interest in or for the names, trademarks, logos, or trade names of Dynapharm, literature and its products. As Dynapharm changes or abandons any of these names or marks. Distributors automatically are subjected to these changes. Dis-tributors may request the right to use these names or marks on inde-pendently produced and non-competitive promotional items that include but are not limited to the following: clothing, jewelry, printed material, posters, audio tapes and the like.

V. Confidentiality of Distributor Lists Dynapharm is determined to protect its distributors and the company

from inappropriate and unfair competition. Records of Dynapharm Dis-tributors, activity reports, genealogies, DPC lists and other information about Distributors, whether partial or complete, provided by or originat-ing from Dynapharm or any Distributor may not be reproduced in any manner or method. The Distributor lists are confidential and remain the exclusive properties of the company. The Distributor lists in its present and future form, as may be amended from time to time, constitute the proprietary assets and trade secrets of Dynapharm.

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All Distributors shall regard the Distributor lists confidential and shall not be disclosed by Distributors to anyone or used for purposes other than in the performance of their obligation under the contract. Disclosure of any portion of the Distributor list require Dynapharm written consent under the following condition:

Dynapharm may provide, for a fee, uniquely tailored portions of the Distributor lists to distributors, which contains information specific to the distributor who has requested it. And the Distributor’s downline organization. A genealogy is a part of the Distributor’s list confidential and regarded also as a trade secret of the company. Dynapharm may at its discretion provide a genealogy to any Distributor.

The Distributor lists are provided for the exclusive and limited use of the Distributor to facilitate the training, support and service of the Distributor’s down line in lieu of his Dynapharm business. Distributors agree that the use of these lists beyond their intended scope constitutes a separate, exclusive agreement between Dynapharm and Distributors.

A Distributor requesting a portion of the Distributor lists is subject to the following:

To limit the used of the Distributor lists within the intended scope to exclusively advance a Distributor’s related business.

To uphold the confidentiality and not to disclose any portion of the distributor lists to any third party, including, but not limited to, existing Distributors, competitors, and the general public. Any unauthorized use or disclosure of the Distributor lists constitute misuse, misappropriation and found in the breach of the Distributor Agreement that may cause irreparable commercial damage to the company.

Any violation regarding the use of the distributor lists shall be dealt with accordingly without prejudice to the filing of civil and/or criminal cases related to trade and commerce.

That the intended or unintended misuse of these Distributor lists or its portion may be grounds for termination of a Distributorship.

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That the provisions under this section shall survive the termination of the Distributor Agreement and the Contract.

Dynapharm reserves the right to pursue all appropriate remedies under applicable national and/or local laws to protect its rights to the Distributor lists as proprietary and a trade secret of Dynapharm.

VI. Product & Income Claims Distributors are not to make medicinal and/or therapeutic claims for any

Dynapharm products nor specifically prescribe Dynapharm products as suitable for the treatment of any ailment. The company does not endorse the use of diagnostic or medical devices in connection with the sale of Dynapharm products because such devices suggest the diagnosis of spe-cific health conditions and the prescription of remedies.

A Distributor shall not misrepresent that the Compensation Plan or any Dynapharm product has been approved or endorsed by any governmen-tal agency. Distributors who use medical devices (whether approved or disapproved by a governmental Regulatory Agency) in connection with the sale of Dynapharm products may be subject to disciplinary action. Misrepresentation or false sales offers as to grade, quality, performance, and availability of Dynapharm products are strictly prohibited.

Similarly, unreasonable or misleading claims of earnings or income po-tentials are strictly prohibited. Income or Rank guarantees are never al-lowed nor is the exhibition of actual or copies of commission checks or earning statements without getting prior written approval from the company. Income representations must be honest and based on facts it shall include disclaimers that earnings vary depending on the degree of effort employed.

VII. Future Growth Claims Distributors shall not imply nor assert that additional products or ser-

vices will eventually be added to the products and services currently of-fered by Dynapharm or that enhancements to the Compensation Plan are forthcoming or that specific territories or areas are about to be opened or added to territories or areas of Dynapharm operation unless such devel-opments have been officially announced by Dynapharm.

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VIII. Product Sales A Distributor may sell or promote Dynapharm products, materials and

opportunities only at Dynapharm functions or to prospective Clients and Distributors or Customers. Acts constituting unfair competition against Dynapharm are prohibited.

IX. International Sales A Dynapharm Distributor may also enjoy income from downlines in

other countries.

X. Sale or Promotion of Non-Dynapharm Products, Opportunities or Materials

A Distributor shall not sell, promote, or advertise non-Dynapharm prod-ucts, opportunities, or materials that compete with Dynapharm products, opportunities or materials in company functions or to potential Client and Distributors. A Dynapharm function is a convention, sales rally, medical symposium, Big BOM or event prepared by Distributors or the company for distributors, prospects and employees.

XI. Repackaging Prohibited Distributors may not alter/change, repackage, sell or distribute unauthor-

ized samples of re-labeled Dynapharm products.

XII. Media Inquiries To ensure accuracy and consistency of information, a Distributor who

receives any inquiry from the mass media (whether televised or in print) regarding any aspect of Dynapharm; its products, or its Independent Dis-tributors, should refer such inquiry to the Dynapharm Business Develop-ment Dept.

XIII. General Meeting & Training Fees A Distributor shall not charge fees for Company-sponsored meetings and

training seminars, services and other materials provided (i.e. newsletter services, computer print-outs, etc.) about Dynapharm, its business op-portunity and its products. A Distributor shall likewise not charge other distributors a membership fee for participation in any other program or organization. A Distributor is prohibited from offering to pay or actu-ally pay other Dynapharm distributors (i.e. commissions or rebates) for

24 BUSINESS MANUAL


purchases of non-Dynapharm products, opportunities, or other materials. Moreover, a Distributor shall not hinder or refrain any other Distributor from attending any Dynapharm-sponsored events.

XIV. Fair & Special Events Distributors, who want to participate in trade fairs, exhibit shows and

other related events should seek a written approval from Dynapharm. Such requests should be received two (2) weeks prior to the show and that the approval must be received before participating in the trade show. Company products and opportunities are the only products/opportunities that may be offered in the trade show booth and that only Company ap-proved and produced marketing materials may be displayed or distrib-uted. Distributors should not display or advertise Dynapharm products at supermarkets, drug stores, health food stores and flea markets.

25BUSINESS MANUAL


Section 6 Distributor Compensation & fees

I. Compensation and Fees A Distributor is compensated in conformity with Dynapharm’s

Compensation Plan. The subsequent policies outline the guidelines for payment of Distributor earnings under the Compensation Plan and ap-plicable fees charged to Distributors.

II. Rank Advancement A Distributor is completely responsible in meeting the monthly require-

ments as follows: PSBV and PGBV Rank and Any other program qualifications are required.

Dynapharm is neither obligated nor would be guarantee or assure that a Distributor can meet the qualification requirements of the Compensation Plan.

III. Guarantees for Earnings A Distributor is neither guaranteed a specific income nor assured a spe-

cific level of profit or success. A Distributor’s profit or success can come through various means like retails stores, use, and consumption of Dy-napharm products by other Distributors within the Distributor’s down line.

IV. Minimum Monthly Compensation Check Unless otherwise predetermined by Dynapharm and to minimize pro-

cessing and handling costs, Dynapharm shall not process and/or prepare monthly check for amounts below US$25. Should a Distributor be en-titled to a commission payment of less that the previously stated amount, this amount shall then be credited as a bonus voucher.

26 BUSINESS MANUAL


V. Commission Checks Payment Commission checks shall be mailed every month specifically on or before

the twentieth (20th) day of the following month in which the commission is earned. However, if the 20th day falls on a weekend or a holiday, the com-mission check shall be sent on the first business day thereafter.

Commission checks issued to joint applicants in a distributorship will be issued in the names of the first two applicants listed on the Distributor Agreement. Without prejudice to Dynapharm’s right of termination, the payment of a Distributor’s commission may also be suspended if a Distributor is found in violation of any provisions in the contract.

Commission checks can be personally released to the concerned Dis-tributor in whose name appears on the Check. If the Distributor is unable to personally claim his/her commission check, he can send an authorized person to do so along with his duly signed authorization letter. Any con-sequence that may lead to the check released to the Distributor Represen-tative, the company should not be held liable.

VI. Debiting of Commission Checks Distributor’s commission checks may be debited or placed on hold for

any amount that the Distributor owes Dynapharm. A Distributor cannot use another Distributor’s commission check in purchasing his/her per-sonal orders.

VII. Check Replacement Upon request, Dynapharm may issue check replacement for lost or sto-

len check. If a lost/ stolen check has been encashed, a service fee of ten percent (10%) of the checks value will be charged to the distributor. Re-placement and stop payment requests will not be honored until ten (10) business days after the check was issued.

VIII. Returned or Unclaimed check Dynapharm makes every effort to ensure that Distributors would receive

their commission checks on time. However, when a commission check has been sent to the last known address but was returned to Dynapharm because a Distributor has moved without a forwarding address, or the check has been returned or not presented for payment for some reason or another beyond Dynapharm’s control, the check shall be cancelled and considered as void.

27BUSINESS MANUAL


Section 7 General Provisions

I. Amendments Dynapharm reserves the right to amend this Business Manual, product

brochures & other literatures, its wholesale or suggested retail prices, product availability and formulations, and terms of the Compensation Plan as it deems appropriate. Amendments will be communicated di-rectly to all Distributors through an appropriate Dynapharm publication or other means. Amendments are effective and binding on all Distrib-utors when issued.

II. Arbitration Any and all disputes arising out of or relating to these documents shall be

resolved and determined by arbitration in accordance under the national and local laws. The decision of the arbitrator(s) shall be final and binding on all parties. The Distributor shall file demands for arbitration within 60 days of the occurrence of the event or action, which is the subject of dispute. Failure to make a demand for arbitration within this period will result in the waiver and loss of all claims by the Distributor with respect to the dispute. Dynapharm has the right to bring suit in a court of compe-tent jurisdiction to seek an injunction, temporary or permanent, or other equitable relief, to prevent or enjoin a breach of a Distributor’s obliga-tions and will be entitled to include in this action any and all claims it may have.

III. Non-Waiver Provisions Dynapharm has the right to exercise any right or power under the provi-

sions of the Contract and its entirety or to insist upon strict compliance with any obligation or provision herein by the Distributor. Waiver by Dynapharm can only be effective through a written authorization of the authorized officer(s) of the company.

The company’s waiver of any particular default by a distributor shall not affect or impair Dynapharm’s right with respect to any subsequent default, nor will it affect in any way the rights or obligations of any other distributors. Nor will any delay or omission by the company to exercise any right arising from default affect or impair Dynapharm’s rights as to that or any subsequent default.

28 BUSINESS MANUAL


IV. Limitation of Damages

To the extent allowed by law, Dynapharm and its affi liates, offi cers, di-rectors, employees and other Distributors shall not be liable for and the Distributor hereby releases the foregoing from, and waives any claim for loss of profi t, incidental, special, consequential or exemplary damages, which may arise out of any claim whatsoever relating to Dynapharm’s performance, non-performance, act or omission with respect to the busi-ness relationship or other matter between the Distributor and the com-pany whether sounding in contract, fort or strict liability.

Furthermore, it is agreed that any damage to the distributor shall not exceed, and is hereby expressly limited to, the amount of unsold Dy-napharm product(s) owned by the Distributor, which were directly pur-chased thereby from Dynapharm and any commissions or bonuses due.

Record Keeping Dynapharm encourages all of its Distributors to maintain complete and

accurate records of their business transactions. These documents (i.e. re-ceipts, invoices) will be of great use especially for the settlement of dis-pute like wrong volume entries, commission complaints and the likes.

DYNAPHARM INT’L. PHILS., INC.Unit 1202 & 1207 12th Floor, Robinson-Equitable Tower,ADB Ave. corner Poveda St., Ortigas Center, Pasig City

Tel. Nos.: (632) 637-2618-20 • (632) 687-4282Fax No.: (632) 6372616

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