Consultant Policies & Procedures Last Modified: January 13, 2014 1 Jamberry Canada Consultant Policies & Procedures Table of Contents INTRODUCTION ............................................................................................................................................. 7 PRACTICING THE JAMBERRY NAILS VALUES ................................................................................................. 7 CONSULTANT STATUS AND QUALIFICATIONS .............................................................................................. 7 Basic Qualifications ................................................................................................................................... 7 Continued Permanent Residence ............................................................................................................. 8 Compensation Plan ................................................................................................................................... 8 Paid-As Title .............................................................................................................................................. 8 Consultant Status ...................................................................................................................................... 8 Career Title................................................................................................................................................ 9 Online Agreement ..................................................................................................................................... 9 Consultant ID............................................................................................................................................. 9 Independent Contractor Status ................................................................................................................ 9 One Name Per Agreement ...................................................................................................................... 11 Business Entities...................................................................................................................................... 11 Exclusive Territories/Solicitation of Overseas Business.......................................................................... 11 EXCLUSIVE PROMOTION OF PRODUCTS ..................................................................................................... 11 ETHICAL CONDUCT...................................................................................................................................... 12 LEGAL COMPLIANCE.................................................................................................................................... 12 LICENSES...................................................................................................................................................... 12 CONFIDENTIALITY ....................................................................................................................................... 12 NON-SOLICITATION ..................................................................................................................................... 12 TRANSFERABILITY........................................................................................................................................ 13 NEW CONSULTANT DEVELOPMENT............................................................................................................ 13 Income Claims ......................................................................................................................................... 13 Limited Right to Make Income Claims, With Timely Disclosure ............................................................. 14 Remote Sponsors .................................................................................................................................... 15 Cross Sponsoring ..................................................................................................................................... 15 2 Sponsor Reassignment ............................................................................................................................ 15 Release of Team ...................................................................................................................................... 15 Improper Initial Assignment ................................................................................................................... 16 Inadequate Support ................................................................................................................................ 16 Deceptive Sponsorship ........................................................................................................................... 16 Disruptive Relationships ......................................................................................................................... 16 Leadership Support Practices ................................................................................................................. 16 No Product Purchase Required ............................................................................................................... 17 ANNUAL RENEWAL OF CONSULTANT AGREEMENT ................................................................................... 17 Personal Website Annual/Quarterly/Monthly Renewal......................................................................... 18 TERMINATION OF CONSULTANT AGREEMENT ........................................................................................... 18 Self-Termination ..................................................................................................................................... 18 Cancellation ............................................................................................................................................ 19 Home Office Termination ....................................................................................................................... 19 Effect of Termination .............................................................................................................................. 20 Events Upon Termination Of This Agreement ........................................................................................ 20 Buy-Back Policy ....................................................................................................................................... 20 Compression ........................................................................................................................................... 22 Reactivation Policy .................................................................................................................................. 22 TEAM MANAGER LEVEL RESPONSIBILITIES ................................................................................................. 23 Commissions Policy And Payout Timelines ............................................................................................. 23 Recruitment Fees Prohibited .................................................................................................................. 24 Account Holds ......................................................................................................................................... 25 Suspension of Contractual Obligations ................................................................................................... 25 CORPORATE MARKETING, LEADS AND ASSIGNMENTS............................................................................... 26 Our Philosophy........................................................................................................................................ 26 TAXES .......................................................................................................................................................... 27 Income Tax .............................................................................................................................................. 27 Sales Tax .................................................................................................................................................. 28 Collection Agreements/Arrangements ................................................................................................... 28 Exempt Sales ........................................................................................................................................... 28 Insurance..................................................................................................................................................... 28 3 ADVERTISING, PRESS, TRADEMARK AND PUBLIC IMAGE PROTECTION ..................................................... 29 Repackaging Or Relabeling ..................................................................................................................... 29 Training Materials ................................................................................................................................... 29 Liability .................................................................................................................................................... 29 Trademarks ............................................................................................................................................. 29 Advertising and Press .............................................................................................................................. 30 Press Contacts and Leads ........................................................................................................................ 30 Media Promotions .................................................................................................................................. 30 Phone Listing Policy ................................................................................................................................ 31 Chequing/Charge Accounts .................................................................................................................... 31 ONLINE COMPLIANCE ................................................................................................................................. 31 Marketing And Naming of Personal Websites ........................................................................................ 31 Restricted Use of Jamberry Trademarked Name .................................................................................... 31 Use of Jamberry in URLS ......................................................................................................................... 32 Use of Jamberry in E-Mail Addresses or Social Networking Names ....................................................... 32 Use of Jamberry Confidential Information – Names, Addresses, Emails................................................ 32 Social Networking Pages on Facebook and More................................................................................... 32 Solicitation of Business on Facebook, Consultant Facebook Group, Twitter or Other Sites .................. 32 Sales Through Auction Sites or Other Internet Sites .............................................................................. 32 Marketing Through Personal Blogs and Other Sites ............................................................................... 33 Third Party Websites that Refer Leads to Jamberry Canada .................................................................. 33 PURCHASE AND SALE OF PRODUCTS .......................................................................................................... 34 Blanket Discounts.................................................................................................................................... 34 Sales Presentations ................................................................................................................................. 34 Bonus Buying........................................................................................................................................... 35 Closing Parties and Customer Delivery ................................................................................................... 35 Third-Party Consumers ........................................................................................................................... 36 Customer Refunds and Returns .............................................................................................................. 36 Customer Order Forms and Sales Receipts............................................................................................. 36 Customer Cancellation rights .................................................................................................................. 37 Territory Restrictions .............................................................................................................................. 37 International Sales .................................................................................................................................. 37 4 Out of Stock Products Items ................................................................................................................... 37 Retail Outlets .......................................................................................................................................... 37 Non-Retail Businesses ............................................................................................................................. 38 Mail Order ............................................................................................................................................... 38 Consultant-To-Consultant Sales Policy ................................................................................................... 38 Rental Space............................................................................................................................................ 38 International Distribution ....................................................................................................................... 38 Marketing Materials Credit ..................................................................................................................... 38 EVENTS ........................................................................................................................................................ 39 Best Practices – Opportunity Events....................................................................................................... 39 Best Practices – Training Events ............................................................................................................. 39 Temporary Sales Events .......................................................................................................................... 40 Assistance For Hearing Impaired At Home Office Events ....................................................................... 41 GENERAL PROVISIONS ................................................................................................................................ 41 Website Downtime ..................................................................................................................................... 41 Contractual Remedies ............................................................................................................................. 41 Acts of Household Members .................................................................................................................. 42 Grievances and Complaints .................................................................................................................... 42 Reporting Policy Violations ..................................................................................................................... 42 Amendments........................................................................................................................................... 42 Indemnification/Offset ........................................................................................................................... 42 Telephone Solicitation ............................................................................................................................ 43 Cumulative Remedies/Waiver ................................................................................................................ 43 Injunctive Relief ...................................................................................................................................... 43 Waiver ..................................................................................................................................................... 44 Jurisdiction .............................................................................................................................................. 44 Partial Validity ......................................................................................................................................... 44 Limitation Of Damages............................................................................................................................ 44 Privacy Policy & Consent ......................................................................................................................... 44 Entire Agreement .................................................................................................................................... 45 COMPANY ADDRESS AND CONTACT INFORMATION.................................................................................. 45 5 6 INTRODUCTION We are very excited that you are considering becoming a consultant of Jamberry Nails Canada Limited Partnership (“Consultant” or “Jamberry Consultant”). Before you take the final step to joining, please carefully review this entire document. If you agree to comply with the Policies & Procedures listed in this agreement (the “Policies & Procedures”), please indicate your agreement by signing the Consultant Agreement that accompanies this document. If you have any questions about any of the terms in this document, please contact Jamberry Nails Canada support at (801) 796-2205. PRACTICING THE JAMBERRY NAILS VALUES At all times, Consultants must:       Conduct themselves with the highest level of ethics, integrity and professionalism. This includes maintaining professionalism and courtesy with customers, other Consultants, and members of the Home Office team. Act in good faith at all times. Not discriminate against any individual because of age, race, creed, color or any other legally protected status. Discrimination will not be tolerated. Provide helpful customer service with the intent of developing long-term customer relationships. Refrain from making disparaging comments or gossiping about others. Abide by all the guidelines listed in Consultant Workstation to ensure it remains a positive and supportive environment. Jamberry Nails Canada Limited Partnership (“we,””, “us,””, “our,””, “Home Office,”” or “Company”) reserves the right to terminate the Consultant Agreement with any Consultant Agreement who does not comply with the Policies & Procedures or fails to operate within the spirit of the Company’s values. CONSULTANT STATUS AND QUALIFICATIONS BASIC QUALIFICATIONS You become a Jamberry Consultant when your completed Agreement has been received and accepted by the Company. To become a Jamberry Consultant you must be of the age of majority in the province in which you reside, be a Canadian citizen or permanent resident, possess a valid Social Insurance Number, maintain your personal website, and be sponsored by a current Jamberry Consultant. If you do not have a Sponsor, you will be assigned one by the Company in accordance with our policy on assignments. In order to sign up with Jamberry Canada, you must visit our website (http://www.jamberry.ca/join/) and submit the online form, which includes the electronic acceptance of the Consultant Agreement and your payment of Cdn $119 for the purchase of a Starter Kit which is sold to you at the Company’s cost. The Starter Kit will help you become familiar with the Jamberry Canada products, services, sales techniques, sales aids, and other matters, and will help you facilitate sales. The Starter Kit includes the following: 1 Sheet of Nail Wraps plus credit for three additional nail wraps of your choice, Jamberry Mini Heater, 6 7 Nail Files, 3 Buffer Blocks, Cuticle Pusher, 3 Pairs of Salon Scissors, 50 Orange Sticks, Nail Care Cuticle Oil, 2, 25-Packs of Catalogs, 50 Nail Sample Cards, Alcohol Wipes, Start-Up Guide, Brochures, Order Forms, Postcard Invitations, and pre-paid access to your Personal Website and back office workstation during the month you join and the three complete calendar months following your sign-up month. As soon as the Company approves the Consultant Agreement and has received your payment, you are ready to get started! CONTINUED PERMANENT RESIDENCE Currently, Jamberry Canada operates only in Canada. In order to retain your Consultant Agreement with the Company, you must remain a permanent resident in Canada. The Consultant Agreement does not transfer to another country in which the Company operates or may operate in the future. To conduct business in another country, you must resign in your original country and sign the relevant agreement for the new country. Additionally, Consultants may not solicit international or cross-border business. In the future, the Company may allow International Sponsorship between Canada and another country. Please note this pertains to Sponsors only. No cross-border/international sales are allowed at this time. COMPENSATION PLAN Consultant commissions, bonuses, rewards, and titles are based upon the Jamberry Canada Compensation Plan which is incorporated into this Agreement by reference. Please review the Compensation Plan for complete details, a copy of which can be reviewed here: http://www.jamberry.ca/uploads/cms/docs/Compensation%20Plan.pdf]. PAID-AS TITLE Your Paid-As Title and Career Title are determined by your monthly sales activity and primarily used for commission calculations and coaching information by the Company and your upline. Your Paid-As Title is determined according to the Compensation Plan and is based on a number of monthly criteria, including Personal Retail Volume (“PRV”), Team Retail Volume (“TRV”), Active Legs, and the Paid-As Titles of certain members of your team (as such terms are defined in the Compensation Plan). CONSULTANT STATUS Consultant status is used to determine a Consultant’s eligibility to receive bonuses, commissions, and rank advancements. Definitions of each status level are: ACTIVE A Consultant must maintain a PRV of 200 each calendar month to be considered Active. If a Consultant has not achieved active status during a calendar month, they receive no commissions from their downline, fast-start bonuses, Matching Advancement Bonuses, or Generational Overrides. Active status is always measured by a calendar month. However, they will receive personal retail commissions from their personal and customer purchases even if they do not achieve Active status during a calendar month. IN PROGRESS At the beginning of each calendar month each Consultant begins with the status of In Progress until she achieves the 200 PRV. If at the end of a calendar month you remain In 8 Progress, then you still receive personal retail commissions on your and your customer’s retail purchases, but you are not eligible to earn any other bonuses or overrides on downline sales during any period where you fail to achieve Active status. CANCELLATION Consultants must have a minimum of 600 PRV during any rolling 12-month period in order to remain a Consultant and keep their downline. If they fail to meet this requirement in any 12-month period, they will be canceled which causes them to be removed from the company downline organization. Their downline and customers will be compressed to the next upline Consultant who is in good standing. RESIGNED Any Consultant who officially resigns from the Company, by providing written notice to the Company. CAREER TITLE A Consultant’s Career Title is their recognition title or the highest title they have achieved. A Consultant’s Career Title does not change unless they advance to the next career level (see Demotion Policy in Compensation Plan for other exceptions), unlike a Paid-as Title, which may vary from month to month. Each Consultant is paid at the title for which they qualify during the period (“Paid-as-title”). ONLINE AGREEMENT Consultants must read the online Consultant Agreement in its entirety before submitting the on-line Consultant Agreement. CONSULTANT ID All Consultants must provide a valid taxpayer identification number (such as a valid Social Insurance Number). The Company will use this number for tax reporting purposes. You will be automatically assigned a non-changeable Consultant ID that has not relationship with your Social Insurance Number. INDEPENDENT CONTRACTOR STATUS You understand that you are not an employee of Jamberry Canada and shall not be entitled to receive any benefits from Jamberry Canada whatsoever. Jamberry Canada shall not be required to make contributions for employment insurance, Workers’ Compensation and other similar levies in respect of payments to be made. You shall be fully responsible for paying all applicable federal and provincial withholding taxes, source deductions, taxes, employment insurance premiums, Workers’ Compensation contributions and other levies, premiums, license requirement and fees related to your earnings and activities as a Consultant. You agree that as a Consultant you are an independent contractor, and not an employee, agent, partner, legal representative or franchisee of Jamberry Canada. You shall be solely responsible for paying all expenses incurred by yourself, including but not limited to travel, food, lodging, secretarial, office, longdistance telephone and other expenses. You will have and maintain control of the manner and means of 9 your performance. You will have no power or authority to incur any debt, obligation or liability on Jamberry Canada’s behalf. For further certainty, the specifics of your legal relationship with Jamberry Canada are as follows: Control - Subject to the terms of the Consultant Agreement, and other applicable laws, Consultants shall have complete control and discretion over the operation of their independent businesses including, without limiting the nature of the foregoing, how much or how little time they may devote to their businesses, and shall be entitled to establish their own business goals, business hours, and business methods, Policies & Procedures. Ownership of Tools – The Consultant shall be responsible for the ownership and acquisition of any business tools, equipment, assets, and expenses, and all business goods, services and intangibles that the Consultant, in his/her discretion, believes necessary for the operation of its independent business including, without limiting the generality of the foregoing, the location and appointment of his or her business office, business cards, letterhead, computer equipment, motor vehicle(s), and other tools and equipment (e.g., phone, office supplies etc.) which he/she alone deems necessary for operation of his/her business, all of which shall established and/or acquired by the Consultant at his/her own expense. The Consultant shall also maintain such insurance, such as liability, fire and theft insurance, during the term of this Consultant Agreement for the benefit of his/her business, in amounts as he/she deems appropriate, and at his/her own expense. Chance of Profit/Risk of Loss – Jamberry Canada and the Consultant agree that all expenses incurred by the Consultant in the operation of his/her business shall be incurred on his/her own account, and be his/her own responsibility. Jamberry Canada and the Consultant also agree that the terms of the Consultant’s compensation is entirely set out in the Jamberry Canada Compensation Plan, and accordingly, the chance of profit and the risk of loss inherent in the Compensation Plan, and inherent in the operation of the Consultant’s independent business, rests entirely with the Consultant, with no “expense reimbursement” or “minimum compensation” being offered or guaranteed by Jamberry Canada whatsoever. No Power to Bind - While a Consultant shall be entitled to inform others that he/she is an Consultant engaged by Jamberry Canada in an independent status, he/she shall at no time represent himself/herself to be an employee of Jamberry Canada, and shall clarify with others, where necessary, his/her status as an independent contractor of Jamberry Canada. The Consultant has no authority (expressed or implied), to bind Jamberry Canada to any obligation, and shall not be construed as purchasers of a franchise or a business opportunity. No Creation of Employment, Agency, Partnership, Franchise or Joint Venture Relationship - The legal relationship between Jamberry Canada and its Consultants is not intended to create, and does not create, an employer/employee relationship, agency, partnership, franchise or joint venture relationship between Jamberry Canada and the Consultant. Treatment as Independent Contractor for Tax and Other Purposes - Accordingly, the Consultant will not be treated as an employee of Jamberry Canada for Canadian provincial or federal tax purposes 10 (including, but not limited to: federal income tax withholding or reporting requirements, federal unemployment insurance and CPP deductions, the GST/HST, and other like taxes, and provincial employment standards rules and workers’ compensation legislation purposes). ONE NAME PER AGREEMENT Jamberry Canada recognizes one name per Consultant Agreement. A Consultant may utilize a support person in her business. However, the individual who holds Parties and has regular customer contact must be the individual whose name is on the Consultant Agreement. Further, Jamberry only permits one Consultant per household. A husband and wife, mother and daughter, or any other combination of individuals in a household may work together under a single Consultant Agreement, but only one Consultant Agreement per household is permitted. If this applies to you, you should determine in advance will be listed as the Consultant for purposes of commission payments and communication with the home office who is only authorized to communicate with the individual listed on the Consultant Agreement about the specific account. BUSINESS ENTITIES The Company will accept Agreements from partnerships, LLCs, or corporations so long as such business entities are legally organized and recognized in Canada. EXCLUSIVE TERRITORIES/SOLICITATION OF OVERSEAS BUSINESS No franchise is granted and there are no exclusive territories for sales or sponsoring purposes. You may only arrange for sale within Canada. You may not solicit business from other countries unless you have written approval from the Home Office. EXCLUSIVE PROMOTION OF PRODUCTS You are an independent contractor, and the Company imposes no restrictions on any Consultant’s participation or sales activity in other businesses. However, promotion of other competitive business ventures is prohibited at Jamberry Canada Home Parties or in communication with the Company’s customers and any competing direct-sales business (e.g. companies that offer finger or toe nail products as one of their offerings) is not allowed. Additionally, should you advance to the Executive Career Title or above, active or public participation in any other direct-selling venture is no longer permitted. Once you achieve the Executive Career Title for the first time, you will have three months to wind down your active participation in other direct selling ventures. After the three month transition period, Executives (or higher) will no longer be permitted to actively recruit for or market any other direct sales company. This restriction does not prohibit you from belonging to or purchasing products from such direct sales company. Violation of this policy will result in ineligibility to receive generational overrides, advancement, and matching bonuses for a minimum of three months. An Executive will still be eligible to receive level overrides, personal sales bonuses, fast start bonuses, and marketing materials credit. This policy is to ensure you have the time commitment available to actively support and train your team. Please review the Compensation Plan for a complete list of Career Titles. A copy of the Compensation Plan can be reviewed here: http://www.jamberry.ca/uploads/cms/docs/Compensation%20Plan.pdf 11 ETHICAL CONDUCT As a Consultant, you agree to conduct your business with the highest standards of honesty and integrity. You agree to refrain from making negative, disparaging, untrue or misleading comments about the Company, its owners, directors, officers, associates, other Consultants or any other direct-selling company or such company’s products. You also agree not to engage in any activities that may cause harm to the Company or any other Consultant. LEGAL COMPLIANCE All Consultants shall comply with all federal, provincial and municipal statutes and regulations concerning the operations of their businesses. You are responsible for your own managerial decisions and expenditures, including estimating income taxes. We recommend that you keep track of all your business expenses and speak with your accountant about how your business expenses might affect your income tax return. LICENSES Some municipal governments might have ordinances that restrict the way you conduct your Jamberry business. Contact your municipal government office to determine if any business licenses are required. Also, if you live in a subdivision or condominium, check with your association to determine if there are any limitations on conducting business activities in your home. CONFIDENTIALITY All lists of customers, your personal team, or other Consultants are proprietary property of the Company and constitute a business trade secret. Jamberry Canada may make these lists available to you for the express purpose of supporting you and your personal team to further develop your Jamberry business. You may use these lists only in connection with your Jamberry business and for no other purpose. You must keep the lists confidential and must not make the lists available to third parties or to use for any other commercial purpose. You agree that any wrongful disclosure of the lists or the information on the lists will cause immediate and irreparable damage to the Company and that the Company may pursue all legal remedies available against you if you violate this provision. This provision will survive the termination of your Consultant Agreement. NON-SOLICITATION As an inducement to Jamberry Canada to enter into this Agreement and in consideration of the mutual covenants contained herein, during the term of this Agreement and for a period of one year thereafter you shall not directly or indirectly, on your own behalf or on the behalf of any other person or entity, solicit, induce or hire or attempt to solicit, induce or hire any Consultant who sponsored you, in your upline, who you personally sponsored, or who was on your team to terminate or alter her business relationship with Jamberry Canada. Additionally, for a period of one year after the termination of this Agreement, you will not own or operate a multilevel social-selling or direct-sales nail accessory business. 12 TRANSFERABILITY Neither this Agreement nor your Jamberry business may be transferred or assigned by you or operated in partnership with any other person. Jamberry Canada reserves the right to re-assign this Agreement at any time. On a case-by-case basis, Jamberry Canada may allow a one-time transfer or your Jambery Nails business to a legal entity owned by you. NEW CONSULTANT DEVELOPMENT As a Jamberry Consultant, you may sponsor other Jamberry Consultants and build a team. Should you choose to sponsor Consultants, you are encouraged to provide adequate training and consistent communication to new Consultants you Sponsor, just as you would want provided to you. A variety of tools exist to aid you in making your training simple and effective. These tools include our weekly Consultant Newsletter, Compensation Plan, online training materials and videos. INCOME CLAIMS The Competition Bureau and the Competition Act regulate claims regarding the amount of income that can be earned under programs such as the Jamberry program. To avoid compliance issues with these laws, you may not make income projections or disclose your own compensation when presenting the Jamberry program. Hypothetical income examples that are used to explain the operation of the Compensation Plan and that are based solely on mathematical projections may be made to prospective Consultants, as long as it is made clear that the examples are hypothetical and not based on actual experience, and the Consultant shares at the time of the hypothetical examples, or within a reasonable time thereafter, Jamberry Canada’s Statement of Typical Participant Earnings. To ensure full compliance with section 55 of the federal Competition Act (Section 55), Jamberry Canada strictly prohibits Consultants from making representations relating to compensation or life-style (hereafter “Earnings Representations”) under the Compensation Plan, whether to a prospective Consultant or otherwise. Without limiting the generality of this prohibition, and because Consultants do not have the data necessary to comply with the legal requirements for making Earnings Representations under Section 55, a Consultant, when presenting or discussing the Compensation Plan to a prospective Consultant, shall be strictly prohibited from, and shall not make or imply directly or indirectly, any verbal, physical, electronic or other claims that amount or could amount to Earnings Representations, and without limiting the generality of the foregoing, this prohibition shall include the making of income projections, improved lifestyle claims, hypothetical income examples or disclosures regarding a Consultant’s own business income (including the showing of cheques, copies of cheques, bank statements, tax records, or other similar demonstrative documents). Furthermore, so that Jamberry Canada may meet its obligations under Section 55 to ensure that (a) no representations relating to compensation under the Compensation Plan are made by participants in the Compensation Plan and that (b) that any representations relating to compensation under the Compensation Plan that may be made, constitute or include fair, reasonable and timely disclosure of the 13 information required by Section 55, any Consultants that has the reason to believe that this general prohibition against Earnings Representations is being contravened by themselves or any other person, SHALL HAVE THE POSITIVE OBLIGATION to inform, and SHALL INFORM JAMBERRY CANADA of the facts relevant to the contravention, such that Jamberry Canada is capable of ensuring that any representations relating to compensation made under the Compensation Plan comply with the provisions of Section 55, or are otherwise corrected. LIMITED RIGHT TO MAKE INCOME CLAIMS, WITH TIMELY DISCLOSURE Without limiting the general prohibition against Earnings Representations, or the reporting obligations set out above, a Consultant shall have the following right(s): (a) To repeat to prospective Consultants, any Earnings Representations found in official Jamberry Canada literature or on the Jamberry Canada website, provided immediately providing fair, reasonable and timely disclosure of the following official Jamberry Canada Statement of Typical Participant Earnings, substantially as follows: Statement of Typical Participant Earnings The primary source of income of a Typical Participant in the compensation plan (the “Plan”) of Jamberry Canada Ltd. (“Jamberry Canada”) is from compensation for the service of arranging for the sale of products. Personal earnings will vary. A Participant in the plan is defined as an Independent Consultant who actively engages in the activities necessary to realize the benefits of the Plan (i.e. earning a least four monthly cheques annually). Typical Participant means a Participant engaged in the Plan for at least one year. A Typical Participant in the Plan earns between CAD $36 and $998 annually. Please note that these earnings are estimates and have been derived from the earnings experience of Jamberry Canada’s U.S. parent company, which operates similar and comparable compensation plans, selling comparable products in the United States and worldwide. These earnings estimates will be reviewed after 6 months of operation of the Canadian Plan, and updated at that time with compensation actually received by typical participants in the Canadian Plan. After one year, this Statement of Typical Participant Earnings will be updated again, and then updated annually thereafter. For greater certainty, the “Lower” and “Upper” Range information shall be provided by Jamberry Canada on its website and in other published materials, from time to time, to properly reflect the earnings of a typical participant in the Canadian Plan, from time to time, and as otherwise required by section 55 Competition Act, and must be used by the Consultant in connection with the fulfillment of its obligations under this section. (b) To make hypothetical income examples to prospective Consultants that are used to explain the operation of the Compensation Plan, and which are based solely on mathematical projections of information set out in the Compensation Plan, provided that in using such hypothetical 14 examples the Consultant also immediately provides fair, reasonable and timely disclosure of the Statement of Typical Participant Earnings, and makes clear to the prospective Consultant(s) that such prior income examples are hypothetical. REMOTE SPONSORS When sponsoring long-distance, Sponsors are strongly encouraged to provide training support and recognition to their sponsored Consultants. Using notes, handouts, video and Skype during team meetings are effective ways to include remote Consultants in place of live, local training and/or meeting attendance. The Sponsor is encouraged to:    Meet Minimum Leadership Support Requirements. Provide all training and support via phone, e-mail, or other effective communication methods or technologies. Arrange with a Consultant in her remote area to have the remote Consultant attend a training session, if available. CROSS SPONSORING Cross sponsoring is strictly prohibited. Cross sponsoring is defined as the sponsorship of an active Consultant or a terminated Consultant who has been active within the preceding six months within a different line of sponsorship. This includes the use of a spouse or relative’s name or assumed names to circumvent this policy. You may not demean, discredit or defame other Consultants in an attempt to entice a Consultant to become part of your sponsored group. SPONSOR REASSIGNMENT Jamberry Canada will not honor requests from Consultants to have other Consultants’ downline transferred to them. Nor will we make transfers if there is any concern that proactive solicitation of another Consultant’s downline has occurred. The Home Office reserves the right to reject transfers for any reason to maintain a NO POACHING culture and environment. In order to protect the rights of all Consultants who work hard to sponsor and mentor others in the business, the Company prohibits the transfer of a Consultant from one Sponsor to another, except under the following conditions: RELEASE OF TEAM A Sponsor may release her team at any time for any reason. In order to do so, the Sponsor should email [email protected] with a letter of release. Home Office will decide whether the team reassignment will be effective immediately or on the 1st of the following month. Each individual team member will roll-up to the next qualified upline (see Roll Ups). If you inherit a team, due to the Compression Policy or a team release, that you feel is too large for you to capably coach and support, please contact the Home Office via [email protected]. The Home Office will determine adequate team reassignment. 15 IMPROPER INITIAL ASSIGNMENT At times a new Consultant will sign-up as a Consultant through the Jamberry website, however due to technology issues or other reasons, they are accidentally assigned to a sponsor they did not intend. In those cases, the Consultant will be reassigned to the sponsor they initially intended provided Jamberry support us notified within 14 days of the consultant’s sign-up date. INADEQUATE SUPPORT If a Consultant is dissatisfied with the minimum level of support received, she may file a request for Sponsor reassignment by contacting Jamberry Canada Compliance Department. Jamberry Canada will then contact the Sponsor via phone or e-mail and give the Sponsor 30 days to release the downline or make amends with the downline so that the request is withdrawn by the downline via e-mail. If the request is not withdrawn, Jamberry Canada will then independently assign downlines to another upline who meets Jamberry’s requirements. No special requests will be honored. DECEPTIVE SPONSORSHIP In cases where a Consultant is assigned to a Sponsor in a deceptive manner or such a manner that it was not clear to the sponsored Consultant who her Sponsor would be, the sponsored Consultant may request to be transferred to a different Sponsor, with her team intact. The new Sponsor will be assigned by the Company. The request must be made by the sponsored Consultant directly to Jamberry Canada Compliance Department by contacting them within 30 days of her start date. The Company will investigate each request on a case-by- case basis, and reserves the right to reject or grant the transfer of sponsorship. DISRUPTIVE RELATIONSHIPS In cases where a Consultant-Sponsor relationship is strained to the point where it is disrupting the business of those individuals and other Consultants, the sponsored Consultant may request to be transferred to a different Sponsor, with her team intact. The new Sponsor will be assigned by the Company and special requests will not be accommodated. The request must be made by the sponsored Consultant directly to Jamberry Canada Compliance Department. Jamberry Canada will investigate each request on a case-by-case basis, and reserves the right to reject or grant the transfer of sponsorship. In the case where Jamberry Canada provides a lead or places a new Consultants on a sponsor’s team and after sign up the new Consultant feels that she is not compatible or comfortable with the assigned Sponsor, the new Consultant may request reassignment. The Home Office looks differently at the cases of assigned relationships versus organic recruiting. The Consultant requesting a sponsor change may not select a new upline. The Home Office will again assign a new leader based on those qualified to receive leads. LEADERSHIP SUPPORT PRACTICES As a Jamberry Sponsor, you are expected to : 16          Actively practice the Jamberry Values as described in this Agreement. Exemplify the cornerstone of Jamberry leadership by maintaining an active and consistent home Party schedule. Actively engage in goal setting and mentoring with the new Consultant. Offer training to the new Consultant by phone or in person within 1 week of the new Consultant signing up to be a Jamberry Canada Consultant. The sponsor should offer several reasonable time slots and be prepared for the training. Allow any new consultant in your downline to attend a Home Party that you are leading or that someone else on your team is leading within 45 days of the new consultant’s activation. Remote Sponsors who live 50 miles or more away from you should be supported by phone. Return phone calls or e-mails within three business days unless you have pre-notified your downline of vacation during which you will be unavailable. Attend planned meetings and trainings for which you did not call in advance to reschedule or cancel. Communicate with your downline monthly by e-mail, phone or in-person meetings to check in with the downline on business goals and progress. Disseminate information from the Home Office to your downline in a timely manner. The Home Office reserves the right to transfer a Sponsor's downline if the Sponsor fails to perform these practices. NO PRODUCT PURCHASE REQUIRED There is no financial or product purchase requirement to become a Consultant or to enter, maintain, or advance in the Compensation Plan. In order to familiarize new Consultants with the Company products, sales techniques, sales aids, and other matters, and for the sole purpose of facilitating sales, Consultants are required to purchase a Starter Kit. The Company also requires that each Consultant maintain a personal website and back-office workstation, so the Consultant can have visibility into her performance and that of her team. The Company sells the Starter Kit to new Consultants and makes the Consultant website and back-office workstation available to new Consultants at or below its cost price. Any products Consultants choose to purchase, including the Starter Kit, personal website access, and the Business Supplies may be returned for refund under the terms of the “Buy-Back Policy” below. The Starter Kit does not contain any commissionable products and any products Consultants choose to purchase in connection with becoming a Consultant are optional. ANNUAL RENEWAL OF CONSULTANT AGREEMENT Renewal dates will be the last day of the month one year following the month of the Consultant’s start date. If a Consultant has a start date of November 2011, her renewal date and renewal payment due date, if any, is the last day of November 2012; i.e. November 30. Consultants will automatically be renewed for a year if they are in good standing under these Policies & Procedures, are maintaining a Personal Website, and are current in the payment of any personal website fees, and agree to any updated Consultant Agreement. There are currently no fees to renew this agreement, provided however, that the Company reserves the right to change this practice in the future. Any such fee would be at or below the Company’s cost for providing Consultants with services to facilitate sales including 17 updated official Company materials. Any renewal fees may be subject to taxes in accordance to federal and provincial law and must be paid in currency (business credits may not be applied).An annual renewal fee, if any, is subject to change in the future without prior written notice. If a renewal fee is required, Consultant must pay her renewal fee online and agree to the latest terms in the Consultant Agreement. Payment of this fee will constitute an agreement to the terms of the latest Consultant Agreement and allow the Consultant to remain as a Jamberry Consultant for an additional 12 months, until the next renewal date. If no renewal fee is required, then Consultant’s continuing to sell Jamberry products or services shall constitute the Consultant’s agreement to the latest Consultant Agreement and Policies & Procedures. Failure to pay the annual renewal fee, if any, by a Consultant will result in the termination of the Consultant Agreement on the first day of the month following the renewal month. Once a Consultant Agreement has been terminated, the Consultant must wait six months before reapplying, as noted in the policies on Deactivation. PERSONAL WEBSITE ANNUAL/QUARTERLY/MONTHLY RENEWAL A Consultant is required to create a Personal Website and to have access to the Consultant back-office workstation when she first signs up as a Consultant. The cost of this service for your join month plus the first three full calendar months after your join month are included in the cost of the Starter Kit. On the first day of your fourth full month as a consultant, the credit card on file will be charged for either a monthly fee of ten dollars (Cdn $12), a quarterly fee of twenty seven dollars (Cdn $32) or an annual fee of ninety seven dollars (Cdn $115) depending on which option you’ve elected. The Personal Website Fee will be automatically charged either monthly, quarterly, or annually without further notice. Your Personal Website Fee must be current to qualify for monthly commission payouts. Your workstation will provide an option for you to select the frequency of your payment and to select your preferred payment method. The Personal Website is provided to you at the Company’s cost. Any Consultant with a Career Title of Executive or higher will receive their Personal Website for no charge. No refunds will be offered to any Consultant who achieves the rank of Executive or higher during any period in which they have already paid for the Personal Website (whether monthly, quarterly, or annually). Refunds for the Personal Website will be provided according to the Company’s Buy-Back Policy. TERMINATION OF CONSULTANT AGREEMENT The following terms are used to describe a termination of the Consultant Agreement: SELF-TERMINATION You may voluntarily terminate the Jamberry Canada Consultant Agreement at any time and for any reason by submitting a Self-Resignation Form (provided by the Company) to the Company. SelfResignation Forms can be downloaded from the Consultant Workstation. Consultants who resign must also send copies of the letter to their upline Consultant and notify any downline Consultants of their resignation. 18 CANCELLATION Cancellation means a loss of Consultant status and all Consultant benefits including product discounts, Company mailings, eligibility for Consultant contests, events and incentives, as well as the loss of all downline Consultants and commissions. All canceled Consultants’ downlines and related coaching commissions will roll-up to the next qualified Consultant, in accordance with our policy on “Roll-Ups”, during the following calendar month. The Consultant Agreement may be canceled: 1. As a result of the Consultant’s resignation. 2. At the conclusion of the initial term or any renewal term without notice. 3. At the death or retirement of the individual Consultant. 4. Immediately upon relocation and change of the Consultant’s permanent residence outside of Canada. HOME OFFICE TERMINATION The Company may terminate the Consultant Agreement with any Consultant at any time and for any reason by notifying the Consultant in writing of our election to terminate. The Company may immediately terminate this Agreement without notice in the event of the Consultant’s death, insolvency, assignment for the benefit of creditors, or misrepresentation in or breach of any provision of the Agreement, violations of policies as herein defined. The Home Office may also terminate the Consultant Agreement if there has been a breach of any term of these policies, the plan or the Consultant Agreement, by the Consultant. Upon termination, the Consultant will have thirty days from the date of termination to provide a written request to Jamberry Canada via email at [email protected] for a refund of any pre-paid Personal Website fees for months which have not yet passed. Upon receipt of such request the Company will refund any such prepaid, but unused amounts, to Consultant within ten business days of such request. If Consultant fails to make such refund request within the time specified above, any such pre-paid Personal Website fees shall be forfeited to the Company. For purposes of this Agreement, a “breach” shall include, but not be limited to, any actions by the Consultant which, in the Company’s sole discretion, the Company believes: 1. The Consultant discredits the Company’s name, goodwill or products, 2. Breaches any provision contained in this Agreement, or the New Consultant Start-up Guide; 3. In any way misrepresents the Company’s products or business opportunity. The Company shall notify the Consultant by e-mail of the Home Office Termination at the latest email address listed with the Company for the Consultant. If the Consultant Agreement was terminated by the Home Office, the Consultant may not reapply. 19 EFFECT OF TERMINATION Terminations of the Consultant Agreement are effective the first day of the month following the date of termination of the Consultant Agreement by the Consultant or the Company or Deactivation. Upon termination of the Consultant Agreement for any reason, your personal group will roll up as per our policy on Roll-Ups. In addition, you will lose any gift certificates, Product Credits and Business Supply Credits that you have earned. You will receive legitimately earned commissions only for the last full payment period you were active prior to termination. In the event that you should choose to become a Consultant again, the Company may accept or reject your application for any reason at its sole discretion. If your application is accepted, you must start at the beginning Career Title of Consultant. EVENTS UPON TERMINATION OF THIS AGREEMENT YOU WILL: 1. Within five days of termination pay all amounts due and owed to Jamberry Canada; 2. No longer have the right to offer or arrange sales of Jamberry products or services and you must cease representing yourself as a Jamberry Canada Consultant immediately; and 3. Be ineligible to receive any unaccrued compensation or benefits as a Consultant. You will cease use of Jamberry Canada Intellectual Property and Confidential Information and will cease holding Home Parties, trade shows, presentations or otherwise displaying, offering for sale or arranging for sale of Jamberry products. If you offer for sale or arrange to sell Jamberry products in violation of the foregoing sentence, Jamberry will be entitled to recover from you Cdn $5,000 as liquidated damages without having to prove actual harm. If requested by Jamberry Canada, you will return all Confidential Information to Jamberry Canada. You may return to Jamberry Canada unsold Jamberry products purchased within thirty days of pursuant to the Buy-Back Policy below, provided that the products are in resalable condition, not discontinued, and are returned with shipping charges prepaid and insured for their full value during shipment, and Jamberry will reimburse you according to the Buy-Back policy set forth below. If you decide to return any unsold Jamberry Products, Jamberry reserves the right to offset any amounts returned to you against previously paid commissions or other rewards. The net refund will be issued within four weeks from receipt of the returned product. BUY-BACK POLICY A Consultant may return any Starter Kits and marketing materials/business supplies that she personally purchased from the Company during the previous year at any time. 1. Starter Kit The Consultant Starter Kit may be returned within one year of purchase and is eligible for a refund of up 20 to 90% of the purchase price. The Starter Kit must be returned in its entirety; all contents of the Starter Kit must be unopened and all items must be unused and in resalable condition in order to receive a refund. The Starter Kit must be returned to the Home Office via registered mail. A trackable and/or insured (insured for approximately Cdn $200) shipping method should be used, as Jamberry Canada will not be responsible for lost shipments. The original shipping and handling fees are not eligible for refund. Opened Starter Kits will be prorated to the resalable value. Damaged or used items may not be returned. 2. Business Supplies, including those wholesale purchases purchased separately from the Starter Kit Jamberry Canada offers business supplies and promotional materials, as well as wholesale product, for your convenience. However, these items are not required to conduct business and may be purchased at your option. Nevertheless, business supplies and promotional materials may be returned to Jamberry Canada within 90 days of purchase for a refund of up to 90% of the purchase price, provided that the business supplies and promotional materials are unopened , unused, and in resalable condition. If you choose to return such business supplies and promotional materials, you are responsible for the cost of the return shipment and insurance to cover the shipment. All such returns should be shipped by a trackable means and should be insured for at least the retail value of the items being returned. Original shipping and handling fees are not eligible for a refund. 3. Personal Website You may cancel any services contracts or arrangements you have purchased including personal website for a refund for any reason, (i) provided written notice (the “Cancellation Notice”) is provided to Jamberry Canada, specifying the specific service(s) subject to cancellation (the “Cancelled Service(s)”). Refunds will be provided for the Cancelled Service(s) pursuant to the policies below. In no circumstances shall you be refunded for amounts paid in respect of Cancelled Service(s) in any month PRIOR TO the calendar month in which the Cancellation Notice is delivered. Note however, that if you cancel your personal website subscription, you will not be eligible to receive commissions or overrides under the plan. Where the Cancellation Notice is provided to Jamberry Canada prior to the 15th day of the calendar month, you shall be reimbursed 100% of the amount paid for the applicable Cancelled Service(s) for that particular month, and no further payments shall be required from you for the Cancelled Service(s). Where Cancellation Notice is provided to Jamberry Canada on or after the 15th day of the calendar month, but prior to the start of a new calendar month, you shall be reimbursed 50% of the amount paid for the applicable Cancelled Service(s) in respect of that particular month, and no further payments shall be required from you for the Cancelled Service(s), such reduced refund amount being commercially reflective of your consumption and use of the Cancelled Service(s) during the first half of the applicable month. 4. Product Inventory Purchases Consultants may purchase retail products in advance as inventory to sell to the Consultant’s customers. 21 Jamberry Canada pays retails commissions on such Consultant inventory purchases. Inventory may be returned to Jamberry Canada within 30 days of purchase for a 100% refund of the purchase price, less any commissions and overrides paid to Consultant that are related to the inventory being returned, provided that the inventory is unused and in resalable condition. If you choose to return inventory, you are responsible for the cost of the return shipment and insurance to cover the shipment. All such returns should be shipped by a trackable means and should be insured for at least the retail value of the items being returned. Original shipping and handling fees are not eligible for a refund. After the 30 day return period, inventory may be returned for product credit, but is not eligible for a cash refund. COMPRESSION Compression occurs when a Consultant who has sponsored a team is either canceled or her Consultant Agreement has been terminated. At the time of a Consultant’s Cancellation or Termination of the Consultant Agreement, every Consultant below her will immediately be compressed up to the next active Consultant in the cancelled or resigned Consultant’s upline. If a Consultant that was paid-as an Executive or higher in the last four periods is canceled (whether voluntarily or involuntarily), their downline will only be compressed up under the following conditions: 1. If their Personal Sponsor has been paid-as an Executive or higher at least once in the last four periods, then the downline will immediately be compressed up. 2. If their Personal Sponsor has not been paid-as an Executive or higher at least once in the last four periods, then they will be given the following six periods to be paid-as an Executive or higher at least twice. If the Consultant promotes to Executive in the last of the six month period, then they will be given the following period to qualify as an Executive again (to meet the 2 periods of being paid-as Executive or higher). a. If the Personal Sponsor qualifies under these conditions, then the downline of the canceled Consultant will be compressed up upon the completion of the qualifications. b. If the Personal Sponsor does not qualify under these conditions, then the position of the canceled Consultant will remain permanently vacant. REACTIVATION POLICY Consultants may reactivate only when their Consultant Agreement was terminated as a result of their voluntary termination of the Consultant Agreement or for their failure to achieve 600 PRV during any rolling 12 month period. Consultants who were terminated by the Home Office may not reactivate at any time, except with the express consent of the Home Office. The Home Office reserves the right to deny a request for reactivation. A Consultant who wishes to reactivate must: 1. Wait six months from the date of termination of the Consultant Agreement before reapplying. 2. Sign up online by submitting a new Consultant Agreement. 22 3. Purchase a new Consultant Starter Kit. Reactivation does not entitle a Consultant to take back her position and downline. Upon reactivation, the Consultant must restart at the Career Title of Consultant and will have no downline. TEAM MANAGER LEVEL RESPONSIBILITIES Consultants who achieve the Team Manager pay level may be asked to sign an Addendum to the Consultant Agreement. Please note that the Addendum will be provided to Consultants for their review prior to the completion of Home Office’s standard month-end checks and processes that confirm all promotion levels. If it is determined that a Consultant did not achieve Team Manager pay level in the preceding month, that Consultant will be contacted by Home Office and need not execute the Addendum. Consultants must submit the signed form to the Home Office within 15 days after the month of advancement. (For example, if you advance to the next level on March 28, you must submit the Addendum on or before April 15 to be paid as a Team Manager in April). Consultants who do not execute the Addendum at the time of advancement can choose to execute the Addendum at any time in the future, provided they allow 30 days advance notice. (For example, a Consultant who signs the agreement after the 15 days, on April 16, will not be paid at Team Manager until the following month, May.) Consultants can opt out of the Team Manager’s Addendum by sending an email to the Home Office at any time. Please allow up to 30 days to process the request. Consultants may only execute the Addendum once during a 12 month period. The purpose of the Addendum is to commit Consultant’s with the Career Title of Team Manager or above to additional leadership requirements and expectations, among other things. COMMISSIONS POLICY AND PAYOUT TIMELINES Consultant commissions, bonuses, rewards, and titles are based upon the Jamberry Canada Compensation Plan which is incorporated into this Agreement by reference. Please review the Compensation Plan for complete details, a copy of which can be reviewed here: http://www.jamberry.ca/uploads/cms/docs/Compensation%20Plan.pdf].     Commissions on your personal retails sales are paid based on the retail value of the products sold. All other commissions, overrides, and bonuses, are based on the commissionable amount of the product. Commissions do not apply to the sale of Consultant-only items (e.g. Starter Kit, business supplies, promotional items, etc.). A commission of 30% will be paid weekly by 11:59 p.m. each Friday for your personal retail sales completed during the period from Wednesday at 12:01 a.m. through Tuesday at 11:59 p.m., i.e. the period ending three days before the commission is paid out. All personal sales bonuses, level overrides, advancement bonuses, matching bonuses and generational overrides will be paid monthly on or before the 10th of the month as described below. If you are receiving your payments by check (and not ProPay) your personal retail sales commissions will be paid monthly, not weekly. End-of-Month Payout: All sales bonuses, level overrides, generational overrides, and other payments will be paid monthly. Your end-of-month payout will be deposited on your card, on or before the 10th of the following the month for U.S. Consultants. If the 10th falls on a weekend or holiday, the commissions will be paid on the next business day. 23         From time to time, we put items on sale at a promotional discount. These special sale items are commissionable on the sale price of the item and not the regular retail price. Business Supplies Credit, if earned, are credited within 5 to 7 business days after the commission period. Please do not call to inquire before this time has passed. Promotions occur after the first of the month following the month when all qualifications are met. Fast Start Rewards are issued weekly and are typically paid within five business days of when they are earned. If you have any issues or discrepancies with your commission report, they must be reported by the end of the calendar month following the month for which the commission was issued. For example, if you have a concern about September’s commission, which you would have received by October 10th, you must report that issue to the Home Office by the end of October of that same year. Issues reported after that timeline will not be researched or adjusted. Send your requests via email to [email protected]. Online earnings reports list the amount of the commissionable product your downline has ordered each month. If overpayments are made, amounts will be deducted from future payouts. If you elect to not be paid your commissions via the ProPay Debit Card, then your commissions will be issued by cheque. Commissions paid by cheque will incur a Cdn $2.50 per cheque processing fee. Commissions payable by cheque are issued only if Cdn $30 or more is due. Commissions totaling less than Cdn $30 will be added to the next month’s commission and issued when accumulated commissions total more than Cdn $30. If you fail to renew your Consultant Agreement due to inactivity or failure to meet minimum sales requirements, or if your Consultant Agreement is terminated, you will receive bonuses and commissions only for the last full pay period prior to the termination (less any amounts withheld during an investigation preceding an involuntary termination). A Consultant is a self-employed, independent contractor of Jamberry Canada. As the Consultant is not an employee of Jamberry, the Company will not issue the Consultant Form 2200, “Declaration of Conditions of Employment”. Instead, Jamberry Canada will issue a T4A form to every Canadian Consultant who earns Cdn $500 or more during the previous calendar year. By the last day of February of each year, Jamberry Canada will issue to each Consultant a T4A form for the previous calendar year. The Consultant will have to report the income from her Jamberry Canada business on Form 2125, “Statement of Business or Professional Activities”. Because the Consultant is self-employed, she may be able to deduct certain business expenses. Each Consultant should discuss this with her tax advisor and/or contact the Canada Revenue Agency for more information at www.cra-arc.gc.ca. RECRUITMENT FEES PROHIBITED To ensure compliance with the Competition Act, Jamberry Canada strictly prohibits Consultants from giving “consideration for the right to receive compensation by reason of the recruitment into the plan of another participant in the plan who gives consideration for the same right”. While Consultants have the right to sponsor other Consultants, the Company does not pay any bonuses, commissions or other remuneration, or allow Consultants to make similar payments, for mere sponsoring/enrolling. A Consultant understands that there is only one revenue generating event for her, namely the service of arranging for sale of Jamberry Nails products to retail customers, and acknowledge that all commissions and other remuneration (including overrides, bonuses, incentives and awards) shall be paid solely as a 24 consequence of a Consultant’s supply of the services of arranging for same and any voluntary training, motivation and marketing efforts related to same shall be construed as incidental thereto. A Consultant’s remuneration will be paid solely as a consequence of a supply of the service of arranging for the sale of Jamberry Nails products to retail customers. No remuneration (including overrides, bonuses, incentives and awards) shall be paid to anyone for the mere sponsorship or enrollment of any other Consultant, or for any other reason. A Consultant is strictly prohibited from making or representing that compensation is payable for anything other than arranging for the sale of goods to retail customers. ACCOUNT HOLDS Jamberry Canada may, at its option, place a Consultant’s account on hold for money owed to Jamberry Canada or for violation of other policies listed in these Policies & Procedures. If an account is placed on hold, the Consultant may be prohibited from placing orders, receiving all or a portion of commissions, registering for Conferences or other corporate events or obtaining other Consultant benefits until the account is current and/or all Policy and Procedure violations are corrected; or, if the Consultant is in a requalification period, until the requalification period has expired. SUSPENSION OF CONTRACTUAL OBLIGATIONS In certain circumstances, Jamberry Canada may agree to allow, as a matter of contract, a Consultant to suspend their contractual obligations to the Company, on the grounds of maternity or other personal leave issues, provided the total time during which the contractual obligations remain suspended does not exceed three (3) months in any one twelve-month period. Consultants may elect to take a leave of absence once every twelve months. The twelve-month period for testing to determine eligibility for suspending the Consultant Agreement begins at the end of the last month of any prior leave taken, if any. To request suspension of their contractual obligations, Consultants can notify Jamberry Canada by e-mailing [email protected]. If a Consultant has earned the rank of Premier Consultant or below for two of the three months prior to requesting suspension of her contractual obligations and provided the Company agrees to such suspension of contractual obligations, the Consultant’s account will be placed on hold during this suspension period. The Consultant will not be required to meet the PCV requirements to stay active or to maintain a team. During the suspension period, however, the Consultant will not be able to access their account, place orders, or receive any form of commissions. If a Consultant has earned the rank of Team Manager or above for two of the three months prior to requesting suspension of her contractual obligations and provided the Company agrees to such suspension of contractual obligations, the Consultant’s account will not be placed on hold. Rather, the Consultant will have access to the Consultant Workstation and personal website during the suspension period. The Consultant will be able to make and receive retail orders and be paid on persona retail commissions only. The Consultant will not be required to maintain the PCV requirements needed to remain active or to maintain a team. Jamberry Canadareserves the right to review requests for suspension on a case-by-case basis to insure that the suspension of contractual obligations policy is not abused. 25 CORPORATE MARKETING, LEADS AND ASSIGNMENTS Jamberry Canada makes a considerable investment in building our general brand and driving awareness that will fuel all of our Consultants’ businesses. Our corporate marketing and public relations efforts are intended to attract new potential customers and Consultants, which ultimately benefits every Jamberry Canada Consultant. OUR PHILOSOPHY 1. For building a great social selling business, there is no substitute for leveraging YOUR social network. Home Office leads should not be expected and are not a way to build a personal business. We do general marketing like press and events because we know that you can then show this media coverage to your network of people and build excitement. 2. Our lead and assignment program has been designed to provide customers with the best possible local experience. By honoring the customer, we believe we build the best business for all Consultants. The Home Office will allocate Leads and Assignments with the utmost integrity to Consultants whom we deem to be exemplary members of the Jamberry Canada team and who we believe will provide the best support and leadership to our customers and new Consultants. a. A “Lead” means a request made by a customer for more information about Jamberry Canada, interest in hosting a home party or learning more about the opportunity to become a Consultant. b. An “Assignment” means a new Consultant who have signed the Consultant Agreement but has not indicated a Sponsor. 3. We do not make exceptions to this program and we are under no obligation to provide history or explanations for our Lead and Assignment allocations. The corporate marketing and public relations efforts will primarily direct potential customers/ Consultants to our official corporate website, www.jamberry.ca. While on the official corporate website, the potential customer or Consultant may learn more about products and Consultant opportunities. The following are examples of qualifications that Jamberry Canada may require for Leads and Assignments. In general, most, but not all, Leads and Assignments will be given to a Consultant who:      Embodies the core values of Jamberry Canada and is an exemplary member of the Jamberry Canada community. Has a Jamberry Canada Personal Website. Has earned the pay rank of Lead Consultant or above in the previous month for leads interested in learning more about the Consultant opportunity. Has qualified in the previous month for leads interested in hosting a Home Party. Have sponsored one new Consultant and performed the leadership support practices. 26 Jamberry Canada has the right to transfer any Consultant who was a Corporate Lead to another team if the Home Office determines the Consultant is receiving inadequate coaching as per the leadership support practices. The Company encourages a Consultant to advertise her personal website in online blogs, social media sites, and other commercial websites as much as possible to drive online sales. However, please note that we have specific rules around online advertising that include:     Compliance with our advertising and online policies. When you market your business, always refer to yourself as a Jamberry Canada Independent Consultant to eliminate confusion between your personal website and the official Jamberry Canada website. You may never sell your products on any site other than Jamberry Canada (this includes eBay, Etsy, or other auction sites). You may not create search engine marketing campaigns (this includes Google AdWords) as it directly competes with Jamberry Canada’s official website and any advertising placements we are running. On Facebook, please keep your paid advertising local and remain within 100 miles of your home. You may not offer blanket discounts in your ad as per the policy on Blanket Discounts. TAXES INCOME TAX As a self-employed professional, it is up to you to maintain complete records regarding your income and expenses. This will greatly assist you when calculating your taxes every year. There are many tax benefits that can be available to self-employed individuals, and everyone should consult their own tax advisors concerning how the benefits may apply to each individual case. Visit the Canada Revenue Agency (“CRA”) website ( at www.cra-arc.gc.ca)or call 1-800-959-8281 for more information. The CRA requires the Company to send a T4A form to every Canadian Consultant who earns Cdn $500 or more during the previous calendar year. By the last day of February of each year, Jamberry Canada will issue each Consultant a T4A form for the previous calendar year. As a Jamberry Consultant, you are an independent contractor to Jamberry, not an employee. Because of this distinction, you are self-employed for income tax purposes. You will report your commission income on Form 2125, “Statement of Business or Professional Activities.” As a self-employed individual, you may have significant advantages in deducting certain business expenses. Examples include home office deductions, business use of your auto, home computer usage and travel and entertainment expenses. We strongly recommend that you talk with your own tax advisor to learn how the tax laws apply to your Jamberry business. Throughout the year, keep all of your receipts for income and expenses in one place. Designate a folder for paperwork and don’t forget to write down mileage that you’ve traveled in order to conduct your Jamberry business. This will make it much easier for you to calculate your tax return at the end of the year. 27 SALES TAX You will not be treated as an employee for purposes of the GST/HST, QST, PST and other like sales taxes (including any future harmonized sales taxes). If we are required to charge any such taxes in respect of our supply of goods or services to the Consultants or to our direct retail customers, we will collect and remit these taxes in respect of our sales as appropriate. However, we are not responsible for collecting or remitting any sales taxes on your behalf. You are responsible for collecting and remitting all applicable local, provincial, and federal sales taxes, and for all other federal or provincial tax compliance obligations imposed on your business, although, as set out below, we may at our discretion enter into sales tax collection agreements with the federal and provincial taxing authorities. COLLECTION AGREEMENTS/ARRANGEMENTS Notwithstanding the foregoing, we reserve the right to enter into sales tax collection agreements with the federal and provincial taxing authorities which could relieve you of the burdens of charging, collecting or remitting sales taxes (including GST/HST, QST and applicable PST). Where applicable, we will notify you of the implementation of such agreements, and will charge and collect sales taxes accordingly. Where we choose to enter into a sales tax collection agreement, you agree that we may jointly elect on your behalf to have the applicable procedures, including section 178 of the Excise Tax Act, apply where approval has been granted by the applicable tax authority. Where we have been approved to operate under any such agreements, you agree to follow the appropriate procedures. EXEMPT SALES If you’re offering or arranging for sale of products to a tax-exempt organization, we can remove the tax from the order prior to submission. The organization will need to provide satisfactory evidence of its entitlement to the tax exemption. For more information about sales to tax-exempt organizations, please contact Jamberry Canada. Insurance If you have a vendor event at a facility, you may be required to provide proof of general liability insurance. Consider speaking with your insurance agent about whether or not you need coverage for a small and/or home- based business. If you are using a vehicle for your business, you can you also discuss auto insurance. 28 ADVERTISING, PRESS, TRADEMARK AND PUBLIC IMAGE PROTECTION REPACKAGING OR RELABELING Because repackaging could violate laws or result in civil liability, all products must be sold in their original packaging only and may not be altered. Offering or arranging sales of half sheets of nail shields is strictly prohibited. TRAINING MATERIALS Consultants may not produce, distribute or sell DVDs, videotapes, audiotapes and other training materials bearing the Company brand and name. If you have suggestions for training material, please submit your ideas to the Home Office by e-mailing [email protected]. LIABILITY 1. Jamberry Canada cannot guarantee or in any way be responsible for Jamberry products purchased from sources other than Jamberry Canada. 2. Jamberry Canada cannot guarantee or in any way be responsible for products that are not officially part of the Jamberry Canada product line. 3. Jamberry Canada cannot guarantee or in any way be responsible for products that have been imprinted with the Jamberry trademark by sources other than Jamberry Canada. 4. Jamberry Canada cannot guarantee or in any way be responsible for products that are used or applied in a manner inconsistent with the stated intent or instructions of Jamberry Canada. 5. Jamberry Canada cannot guarantee how a customer’s nails will react to its nail wraps. If you or a customer notices that the nail wraps are causing dryness or damage to the nails, please follow the removal instructions, follow industry nail care advice, and wait three weeks before applying a new set of nail wraps. TRADEMARKS 1. Consultants’ duplication of Jamberry trademarks or service marks is prohibited. Examples of Jamberry trademarks include, but are not limited to, Jamberry, or the Jamberry logo. Display or sales of Jamberry product in retail or service establishments of any kind are inconsistent with the purpose for which the trademarks are registered. 2. When reproducing the Jamberry logo, it must not be altered in any manner or form. Jamberry Consultants may not duplicate the Jamberry trademark for private use or for the intention of offering or arranging sale of non-Jamberry products to others. 29 ADVERTISING AND PRESS You may advertise in local publications and online, but must make sure your advertisement is accurate, professional and not misleading in any way. You must always list your Jamberry Canada personal website address and use only official Jamberry logos and images. If you list contact information, you must identify yourself as an Independent Consultant so that there will be no confusion that you represent the Home Office. You may advertise sponsoring opportunity events, home parties or any other Jamberry Canada events you choose. You may not run advertisements that feature specific products for sale or blanket promotions (please review our policy on blanket discounts). PRESS CONTACTS AND LEADS The Home Office and our public relations firm are the primary points of contact with any and all journalists, top-tier bloggers*, editors, celebrities and large-scale fashion and beauty influencers on behalf of Jamberry Nails. Any Consultant wishing to contact any of the aforementioned press or media entities, even if they are hyper local, is required to contact the Home Office Marketing Department first. We may already be working with them, and if we are not then we can work with you to further your goal in working with them while ensuring you are compliant with our policies and procedures regarding these relations. Please direct any and all questions and media inquiries to [email protected]. *Top-tier bloggers include any blog that has a reach/following of 5,000+ people. If you are contacted with a blogger that is classified as a top-tier blogger, please forward their message and contact information to [email protected]. MEDIA PROMOTIONS The Home Office initiates all television, cable TV, radio, Internet, newspaper, newsletter and magazine interviews, features and paid advertisements. Jamberry Consultants may not initiate, authorize or implement national or regional media publicity. Consultants, however, are encouraged to initiate/implement local media interviews. All interviews with the media must be handled through the Company Communications Manager. Whether the media outlet pursues you or vice versa, you must inform the Company before the interview is conducted (no exceptions). Contact the Home Office Marketing Department immediately and refer the reporter/writer to our public website for contact information. If you are approached by a member of the national media about contributing to a story, you must refer her or him to the Company immediately. Contact [email protected]. As with advertising, you may only personally approach local media when submitting a press release or story pitch. Your copy must be approved through Jamberry Canada prior to sending it. You may submit your copy for approval to [email protected]. The Company requires Consultants to list the Jamberry Canada web address in addition to any personal contact information. The Company must approve proposals for regional or national media promotions in 30 advance. Look online in the Consultant Workstation for high-resolution logos and advertising guidelines. PHONE LISTING POLICY A business phone number may be listed in the following manner: Name, Career Title with Jamberry Canada Independent Consultant Address Phone Number CHEQUING/CHARGE ACCOUNTS Jamberry Consultants may not use the trademark or trade name Jamberry on bank accounts, credit applications with local suppliers or other business forms. Chequing accounts can simply be designated as “Business Accounts.” Or, if you need to list a business on your chequing account, credit application or other form, use your name and “Jamberry Independent Consultant.” The intent of this is to avoid any implication that a Consultant business is the Corporate Office. ONLINE COMPLIANCE Jamberry Canada builds our brand for the general benefit of all Consultants. Thus, our trademarked brand name cannot be used to drive traffic away from our corporate site. Our corporate site allocates Leads to all qualified and active Consultants. Infractions may result in the immediate termination of a Consultant account. You may not represent yourself in any way online that detracts from the Jamberry brand. You may only have a Personal Website through Jamberry Canada. In compliance with laws and Direct Selling Association policy, all Independent Consultant marketing both in print and online must clearly appear as though it is coming from an independent representative of the Company and not lead the consumer to think they may be interacting with the corporate office. Furthermore, any ad in which the trademarked Jamberry name or logo is used must be approved by the corporate office. Corporate-approved advertisements will be made available online in the Consultant Workstation. MARKETING AND NAMING OF PERSONAL WEBSITES Using a generic extension like shop, nail shields, cities or major regions, etc., is not allowed as it appears to the end user that this is a corporate site URL. Your extension must relate to your name. You cannot use any name like www.jamberry.ca/nailshields; ww.jamberry.ca/shop; or jamberry.cawww.jamberry.ca/ontario. RESTRICTED USE OF JAMBERRY TRADEMARKED NAME The trademarked Jamberry name cannot be used in any Google AdWords or other search engine marketing campaigns of sponsored links. This includes the use of your Personal Website, since this contains jamberry.ca. All web advertisements must clearly contain the descriptor of Independent Consultant in both the title and description field. 31 USE OF JAMBERRY IN URLS You may not use jamberry, jamberrynails, or any derivative in a registered URL with any extension. This is in violation of our trademarked name and can result in the termination of a Consultant account. For example, you cannot register or use any URL like www.myjamberry.ca or www.jamberrynails.tv, etc. USE OF JAMBERRY IN E-MAIL ADDRESSES OR SOCIAL NETWORKING NAMES You may not use jamberry, jamberrynails or any derivative of that in any e-mail addresses or social media names. For example, you may not use anything like [email protected] or [email protected] or Jamberry Arizona for a Facebook group page. If you do this, we you may be required to change your email address or the social media name before you are eligible to receive commissions or overrides. USE OF JAMBERRY CONFIDENTIAL INFORMATION – NAMES, ADDRESSES, EMAILS As a Consultant you may be given access to certain information about your downline including names, email addresses, addresses, phone numbers, etc. All of this information is confidential and should not be used for any purpose other than Jamberry business. You are restricted from using this information to send invitations to or information about other direct sales companies, school fundraisers, personal issues, or the like. If you misuse this information, your Consultant Agreement may be terminated and/or your access to such information may be removed. SOCIAL NETWORKING PAGES ON FACEBOOK AND MORE You cannot create a fan page on Facebook or any other social networking site that appears to be the corporate office. However, you may create a site that includes the term “Independent Consultant for Jamberry” in the name. You cannot use the word “official” or anything similar. You cannot create an alias for any sites like Twitter or others that use any permutation of the Jamberry name. The social network page cannot make mention of “Jamberry” without being qualified by “Independent Consultant for Jamberry” or “Jamberry Independent Consultant.” SOLICITATION OF BUSINESS ON FACEBOOK, CONSULTANT FACEBOOK GROUP, TWITTER OR OTHER SITES Consultants may not use the Jamberry Official Facebook Fan Page or Consultant Facebook Group to solicit business, drive people to your Personal Website, or sign up team members. An additional list of rules for the Consultant Facebook Group can be found on the Consultant Facebook Group Home Page and the Consultant Start-Up Guide. SALES THROUGH AUCTION SITES OR OTHER INTERNET SITES Jamberry Consultants may not sell Jamberry Nails products on any website other than her personal Jamberry website (including site such as e-bay, craiglist, or Groupon). Jamberry Consultants may not display product images on other websites with the intent to sell. 32 You may NOT offer or arrange sales of Company products (including Business Supplies) through any online auction service or any other website. Nor may you advertise your business or the business opportunity through online auction services. We have a no-tolerance policy on Internet sales and any infractions may result in immediate termination. MARKETING THROUGH PERSONAL BLOGS AND OTHER SITES If you maintain a blog, email, newsletter, or website outside of the Personal Website that Jamberry makes available to its consultants, you may not market, sell, or promote any other products or direct sales companies alongside Jamberry products. Doing so may result in your suspension or termination of the Consultant Agreement. THIRD PARTY WEBSITES THAT REFER LEADS TO JAMBERRY CANADA What is an affiliate program? An affiliate program is a marketing practice in which Jamberry Canada pays certain third party websites for each new customer or Consultant they drive to the jamberry.ca websites through the affiliate's own marketing efforts. Our primary goal for our affiliate program is to acquire new customers so that we can direct business to our Independent Consultants. Can Consultants become affiliates? No, Consultants cannot be affiliates. Instead, Consultants earn commissions for sales of products under the Consultant Compensation Plan. So, even if we pay an affiliate commission on an order to an outside third-party website, the new customer is referred to a Consultant who can offer and arrange sales of products to the new customer and in turn will receive a commission on the sale of the product.. If you have questions about the Jamberry affiliate program, contact us at [email protected]. Home Office Sponsored Co-Branded Promotions or Giveaways Jamberry Canada reserves the right to partner with other brands or websites to create occasional cobranded promotions or giveaways. The purpose of these promotions is to gain awareness among (and access to) a new set of consumers who may not otherwise know about Jamberry Canada. Our primary goal is to acquire new customers so that we can direct business to our Independent Consultants. In addition, partnering with well-known and highly-regarded brands promotes Jamberry’s fashion authority and raises overall brand awareness – helping open doors for our Consultants’ own personal businesses. Please note: as a reminder to our Consultants – in order to enhance the end-user experience, we request that Consultants do not use these home-office sponsored promotions as a way to direct traffic to their personal websites. (For instance if there is a contest where a website asks users to submit comments related to the promotion, please do not use the comments as a way to promote your personal website.) As you can imagine, this activity does not support the brand awareness goal and can cause confusion among people new to the brand. All leads acquired from this promotion will be distributed through our normal lead referral program. 33 PURCHASE AND SALE OF PRODUCTS Jamberry is a direct-to-consumer business, and a Consultant’s success with customers depends on personal relationships. Through direct sales, the consumer may try before buying and receive proper individual instruction in product usage, both before and after the sale. Therefore, Jamberry Canada’s policies regarding sales are intended to steer Consultants away from the pursuit of the one-time only, impulse sale, toward long-term, relationship-based sales. That is why Jamberry Consultants are encouraged to conduct in-person informational Home Parties for individual consumers or groups. BLANKET DISCOUNTS You may not offer your Consultant discount to the public at large, including friends and family. This prohibition does not apply to sales pursuant to any Fundraising programs that the Company may have in place at any given time or to wholesale sales to Salons. Your personal discount is for personal purchases only. You may however, buy gifts for others with your discount. You are prohibited from offering a blanket discount at Home Parties, through your personal website, or other marketing channels, including Facebook. This includes “25% off everything at my Home Party” or place an “online order with me and I will rebate you 15%.” Any other permutation of an offer that serves to undercut the retail price of Jamberry is restricted. You may however offer specific, time limited, occasional incentives such as “book a Home Party tonight and get $25 off your order,” or, “spend over $100 and receive free shipping,” so long as your promotions (including free shipping): • Are offered to a limited group of customers (members of a club, specific group of individuals, not, for example, an open invite to anyone who can view your Facebook profile). • Run for no more than 3 days. • Occur no more than one time per quarter. You may then personally incur the cost of the shipping or specific promotion for your customers. Any promotional discount that contributes to a Consultant’s minimum PRV requirements for earning overrides or her volume rebate will be grounds for termination of her Consultant Agreement with the Company by the Home Office. We expect our Consultants to use their conservative discretion when interpreting the terms of this policy. SALES PRESENTATIONS At sales presentations, you will truthfully represent the Company, yourself and the products. You may not use any misleading, deceptive or unfair sales practices. Explanation and demonstration of products offered will be accurate and complete, including but not limited to, price, terms of payment, refund rights, guarantees and after- sales service and delivery. Personal or telephone contact will be made in a reasonable manner and during reasonable hours to avoid intrusiveness. Immediately discontinue a sales presentation upon request of the consumer. Also, refrain from using comparisons which are likely to 34 mislead, and which are incompatible with the principles of fair competition. BONUS BUYING The success of the Company depends on retail sales to the ultimate consumer. It is possible to conduct a healthy business with no product inventory other than your samples. While the Company recognizes that you may wish to purchase certain products for your own use, or in some cases, for “instant delivery” to customers in need of last-minute gifts, it strictly prohibits the purchase of products in unreasonable amounts and prohibits the purchase of products only or primarily to qualify for compensation levels or incentive programs. This is one of the unethical practices that we refer to as “Bonus Buying” and is strictly prohibited. Bonus buying may also result in the immediate termination of a Consultant Agreement. Bonus Buying includes: 1. The sponsorship of individuals without their knowledge and/or execution of an Consultant Agreement on behalf of others without their knowledge; 2. The fraudulent sponsorship of a Consultant; 3. The sponsorship or attempted sponsorship of nonexistent persons as Consultants (“phantoms”); 4. The use of a credit card by or on behalf of a Consultant when the Consultant is not the accountholder of such credit card; 5. Subsidizing the entire or partial cost of a customer purchase or New Consultant Starter Kit purchase that counts towards your volume or adds a Consultant to your team. This includes offering a blanket discount or rebate on the purchase of goods; 6. The purchase of product to qualify for contests, fast-start bonuses, promotions, personal sales requirement for coaching commissions or pay rank; 7. Maintaining excessive inventory. Consultants may not inventory load, encourage others to inventory load or represent that there is any obligation to purchase products, literature or other sales aids except for the Starter Kit, nor shall they represent that overrides, bonuses or other earnings may be obtained solely from the purchase of products rather than the sale of products. Inventory is not a component of our business and should not be carried beyond the month in which it is intended to be sold. CLOSING PARTIES AND CUSTOMER DELIVERY All parties must be closed and submitted within the Jamberry Canada system within five days of the actual home party orders being given to the Consultant. Home Parties must close in their entirety within fourteen days of holding the actual Home Party. In addition, all customer orders given directly to a Consultant must be submitted and closed within the Jamberry Canada system within five days of the customer placing the order. If a customer or party order is shipped directly to a Consultant, the Consultant must deliver the orders to the customers within five business days of receipt. Any violation 35 of this provision may result in immediate termination of the Consultant Agreement with the Compnay by the Home Office. THIRD-PARTY CONSUMERS Consultants who cultivate business contacts must remember that the business can purchase Jamberry products as gifts for employees or clients, but there may not be a resale value attached to the products. Consultants cannot become a “vendor” to another business. Consultants who offer or arrange sale of Jamberry products to a business for gifts must include a personal letter with each gift that provides information about how the end-user can receive personal service from the Consultant. Large-scale sales of Jamberry product to regional or national companies are prohibited since they do not lend themselves to the development of personal relationships and personal service that Jamberry is based upon. CUSTOMER REFUNDS AND RETURNS You must comply with the Return Policy and procedures currently listed on the Jamberry Canada website at www.jamberry.ca. Customers and consultants are only eligible to return up to $1,000 of retail products during any 12 month period. Any attempt to return products for a refund in excess of $1,000 will be denied and such returns are ineligible for a refund. If a consultant returns product for a refund and a commissions has already been paid to the consultant for the sale of such product, any refund will less the commission amount. CUSTOMER ORDER FORMS AND SALES RECEIPTS All Consultants making person-to-person sales to customers (including any sales subject to provincial direct selling requirements) shall ensure that the customer is provided with the then current copy of the Jamberry Canada Sales Order Form, properly completed, and signed by both the Consultant and the customer. The Sales Order Form sets out, among other things, the Buyer’s Cancellation Right afforded to the customer under provincial law. Consultants must ensure that all information fields in the Sales Order Form are completed, including the following: (1) the date of the transaction; (2) name and address of the selling Consultant; and (3) the signatures of the selling Consultant and the customer, and the location where the Form was signed. In addition, the Consultant shall orally inform the customer of his or her cancellation rights. Consultants are required to keep a copy of each Sales Order Form for their own records, and shall be required to retain same for a period of at least seven (7) years. Where a customer places an order through a Consultant’s personal website, the customer will be required to positively accept the sales contract during the order process, and will thereafter be provided 36 with an Electronic Receipt providing printable evidence of the sales contract, and otherwise providing disclosure as required by provincial law. Consultants will be provided with a copy of each Electronic Receipt for their own records, and shall be required to retain same for a period of at least seven (7) years. CUSTOMER CANCELLATION RIGHTS Consumer protection laws in Canada’s various provinces generally requires a mandatory 10 day cooling off/cancellation period for sales of products or services and effectively requires that every purchaser be given the unqualified right to cancel the direct sale contract, within 10 days of purchase. This right is set out on the back of the Jamberry Nails Order Forms. A Consultant is required by law to tell her customers about their right to cancel orders within ten business days. If a customer cancels an order within the applicable cancellation period, a Consultant must promptly refund the customer’s money (as long as any products the customer received are returned to the Consultant in substantially the same condition). This includes an order for personalized products. If a customer cancels an order that the Consultant has already submitted to the Company, please contact Support at [email protected]. TERRITORY RESTRICTIONS There are no exclusive territories granted to anyone, and no franchise fees are required. INTERNATIONAL SALES Due to complex legal and tax considerations involving international sales, no sales or recruitment efforts may be made outside Canada, unless you have received written approval from the Home Office. OUT OF STOCK PRODUCTS ITEMS The Company will quickly ship all products currently in stock. Any out-of-stock items (unless discontinued) may be placed on back order and will be distributed upon Company receipt of additional inventory. A Consultant will be charged and granted commissions on future ship items once the order is submitted. Items designated for future ship may be cancelled on a Consultant’s request and a credit will be made to either the Consultant or customer card based on the original payment method. Commissions will be adjusted accordingly. If the item designated for future ship cannot be filled, the Company will cancel the order and adjust commissions accordingly. The Company has the right to offset such amounts against future commission and other compensation paid or owed to the Consultant who received commissions for subsequently canceled orders. RETAIL OUTLETS We do not allow Consultants to set up a permanent retail display and sell Jamberry products in a retail environment. They are intended to be sold at a Home Party. A retail outlet includes a kiosk in a mall, boutique, grocery stores, flea markets, etc. 37 You may conduct a Home Party at the same retail location (such as a restaurant) once every 3 months, and no more than 4 times a year. NON-RETAIL BUSINESSES Consultants may leave a flyer in non-retail establishments, such as doctors’ offices, provided the intent is to attract participants to a Home Party, not to sell. Restaurants are not retail establishments and you may periodically conduct Parties or meetings in a restaurant. MAIL ORDER Jamberry Consultants may not advertise, promote, sell or sponsor through other company catalogs. CONSULTANT-TO-CONSULTANT SALES POLICY Consultants may make Jamberry products available to other Consultants on a cost-recovery basis. For example, when a Consultant has an item in her samples and does not have time to receive an order from Jamberry Canada, it is acceptable for one Consultant to sell the Jamberry item to another at the Consultant purchase price. No adjustments of volume or commissions will be made by the Home Office. Violation of this policy will result in the termination of your Consultant Agreement with the Company. RENTAL SPACE Consultants may rent space for Home Parties, however, in order to prevent the appearance of such a space as being a retail establishment, Consultants may not store product in the location. The product must be stored in the Consultant’s home. Permanent signage or telephone rental locations are prohibited. INTERNATIONAL DISTRIBUTION Jamberry Nails Consultants may not conduct business outside of Canada. Jamberry Nails Canada does offer Consultants the opportunity to sponsor consultants in the United States with special approval. If you are interested in sponsoring consultants in the United States, contact [email protected] for more information. MARKETING MATERIALS CREDIT Consultants may earn credit that can be used towards the purchase of marketing materials (catalogs, host join pamphlets, sample cards, postcards, order forms) based on the following monthly retail sales volumes listed below: Monthly Personal Retail Volume (PRV) Marketing Materials Credit Under 600 Cdn $0 38 600 - 699 Cdn $25 700 - 799 Cdn $30 800 - 899 Cdn $35 900 - 999 Cdn $40 1,000+ Cdn $50 Marketing materials credit that is more than six months old on June 30 and December 31 of each year will expire. Marketing materials credit may only be used on marketing materials and not on any promotional products, retail products, shipping, or taxes. EVENTS BEST PRACTICES – OPPORTUNITY EVENTS The purpose of a Company sponsored opportunity event is for guests to come and have fun while feeling welcome and comfortable to explore the business and gather more information about becoming a Consultant. It’s also a great event for Consultants to attend along with their guests, or to come alone and learn how to talk to others about our opportunity. We want the atmosphere to be light and lowpressure, but informative and helpful. As we grow in popularity, there is a chance that some guests may arrive at our opportunity event who are “unattached” to an existing Consultant. There is also a chance that a guest was informed of our event by a fellow Consultant that couldn’t be in attendance. To help reduce confusion, we ask every guest to fill out a short information card upon arrival. This card is then used to figure out where, and with whom, most guests belong. In the case of an “unattached” guest, here is the procedure that should be followed: • A list of all Consultants in attendance of the opportunity event will be kept • “Unattached” guests who end up becoming Consultants as a result of our opportunity event will be assigned using the Home Office Leads system. Please remember that this situation is rare and you should not attend an opportunity event in the hopes of sponsoring someone new (unless you’ve invited a guest of course!). Please refrain from handing out your personal business cards to any “unattached” guests in the hopes of sponsoring and instead, answer any questions they may have in a helpful way. In the end, everyone benefits and if not personally at this event, then perhaps down the road. BEST PRACTICES – TRAINING EVENTS The Home Office will not be responsible for lost or stolen inventory in the event that a Consultant brings her own inventory to a Training event. The Home Office recommends that all inventory be locked up during break periods. 39 TEMPORARY SALES EVENTS Public events can be opportunities to receive exposure for your Jamberry business. You can find people interested in hosting a Home Party, purchasing the product or becoming a Consultant. However, it is important to consider the cost vs. the return. Consultants may promote their business (offering or arranging sale of Jamberry products and sponsoring) at exhibits and trade shows, in accordance with the following: • The registration for the event must be as a Jamberry Consultant. • The first Consultant to register for the space with the event sponsor has the right to conduct that event. If a second Consultant would also like to participate, she must contact the first registrant and obtain her permission. If two Consultants are registered without prior knowledge, it is up to the second Consultant to withdraw from the event if the first registered Consultant does not want double participation. When registering for events, it is a good business practice to check cancellation policies and to proactively check with the sponsor to ensure another Jamberry Consultant is not already registered. • The booth must be staffed at all times and must not be shared by another business. • An event held in the common area of a shopping mall is permissible. Please note that Expos, Trade Shows and Booth Events are not considered a core part of the Jamberry business and the Home Office does not specifically recommend participation in these events, nor do we endorse any specific event. Furthermore, as an Independent Consultant, you are responsible for your decision to host or co- host a booth at an Expo, Trade Show, or Booth Event. The business agreements made between Jamberry Consultants to host or co-host an event are the proprietary responsibility of the Consultants and the event planners. We strongly advise every Consultant to evaluate every business decision thoroughly before proceeding with the understanding that the Home Office is not responsible for the Consultant’s participation or subsequent results. Participation in any one specific Temporary Sales Event shall be limited to two weeks in a calendar year. The goal of Jamberry Canada in establishing this policy for trade shows, expos and craft fairs is to promote the professional image of Jamberry Canada and all Consultants, and provide an atmosphere of mutual respect and ethical cooperation. You are encouraged to take creative approaches in your selling. However, your primary approach should always be a Home Party. Before agreeing to participate in any other type of event, you should be able to answer “yes” to the following questions:     Is this event fair to all parties involved? Is this legal and ethical? Will this generate new bookings or future business? Will this approach provide the best environment for a successful event for the Hostess? If a Temporary Sales Event (such as a craft fair or holiday bazaar) a) is set up inside a retail environment (such as a shopping center or base exchange); b) occurs more often than every six weeks in its entirety, and/or c) occurs for twenty-five (25) consecutive days or more, you may set up a display about your 40 independent sales business for the event but you may NOT have product available for cash and carry sales. An established retail environment is defined as a location in which permanent retail activities take place, such as inside a shopping center, inside or adjacent to a base exchange, or inside or adjacent to a permanent swap meet. Shopping center kiosks, base exchanges, or permanent swap meets are not approved locations for temporary sales forums, because they take place within an established retail environment. If you have any questions about whether to participate in an event, please contact Support. When you register to participate in an event, the event sponsor may ask you for your sales tax registration or inform you that you must post a copy of your Seller’s Permit at your booth. Regarding charging and collection of sales tax, please refer to “Sales Tax” section on page 27 for details. If you are required to provide sales tax registration information to the event organizer, please email [email protected] with the name and contact information for the event and we can provide you our sales tax information and information on how to obtain an insurance rider for the event. ASSISTANCE FOR HEARING IMPAIRED AT HOME OFFICE EVENTS While the Home Office holds several events throughout the year, the Company is not required to provide accommodations for hearing impaired Consultants. Consultants are independent and not company employees, and therefore should be prepared to make their own accommodations. GENERAL PROVISIONS Website Downtime You acknowledge that the Jamberry website may be subject to temporary shutdowns from time to time for maintenance and/or due to causes beyond the operating party's reasonable control, and that neither party shall have any liability to the other by reason of any such shutdowns. CONTRACTUAL REMEDIES Any breach of these Policies & Procedures or the Consultant Agreement, or any illegal, fraudulent, deceptive or unethical business conduct on your part may result, at our sole discretion, in one or more of the following contractual remedies: • Issuance of a written warning or admonition. • Seeking a liquidated damages amount from you, which may be imposed immediately or withheld from future commission cheques. • Reassignment of all or part of your organization. • Placing you on Account Hold, during which period you may not conduct Jamberry business or receive compensation. 41 • Suspension of your Consultant status, which may result in termination, or reinstatement with conditions or restrictions. • Termination of Consultant status. ACTS OF HOUSEHOLD MEMBERS The violation of a provision of the Jamberry Consultant Agreement or these Policies & Procedures by any member of your immediate household will be imputed to you and will subject you to appropriate action by Jamberry Canada, including possible termination of your status as a Consultant. GRIEVANCES AND COMPLAINTS If you have a grievance or complaint about another Consultant that you are unable to resolve regarding any practice or conduct related to the Jamberry business, please submit a report (electronic or written) describing the situation to Jamberry Canada Consultant Support for review to [email protected]. REPORTING POLICY VIOLATIONS If you observe a violation of the Policies & Procedures by another Jamberry Consultant, please submit a report (electronic or written) to Jamberry Consultant Support ([email protected]) describing the circumstances, evidence and any other pertinent information. Your report to the Company will be held in the strictest confidence. AMENDMENTS The Company reserves the right to amend 1) Consultant Agreement, 2) the Compensation Plan, 3) the Policies & Procedures, 4) its prices, 5) product and service availability at any time without prior notice as it deems appropriate. Amendments will be communicated to Consultants through official Company publications, websites, or voice or e-mail. Amendments are effective and binding on all Consultants as of the date of issuance. In the event of any conflict between the original documents and policies and any such amendment, the amendment will control. INDEMNIFICATION/OFFSET As a Consultant, you indemnify and hold harmless Jamberry Canada and its owners, employees, agents and assigns from and against any damages, claims or liabilities and expenses (including attorneys’ fees) incident to your: (a) activities as a Consultant including, without limitation, any unauthorized representations made by you; (b) breach of the terms of the Consultant Agreement; or (c) violation of or failure to comply with any applicable federal, provincial or municipal laws or regulations. Jamberry Canada shall have the right to offset any amounts owed by you to Jamberry Canada (including, without limitation, the repayment of commissions as a result of product returns) against the amount of any commissions or bonuses owed to you. 42 TELEPHONE SOLICITATION Consultants may not use or transmit unsolicited faxes, make unsolicited telephone calls, or use an automatic telephone dialing system relative to the operation of their Jamberry businesses and agree to inform themselves of the laws applicable to telemarketing. The terms “unsolicited faxes” and “unsolicited telephone calls” means faxes and telephone calls, respectively, made for the purpose of solicitation to a recipient who has not consented to the fax or telephone call. The term “automatic telephone dialing system” means equipment which has the capacity to: (a) store or produce telephone numbers to be called, using a random or sequential number generator; and (b) to dial such numbers. Consultants are not authorized to make unsolicited telephone calls or send unsolicited faxes on Jamberry Canada’s behalf. If a Consultant decides to make such calls to persons with whom he/she has an Existing Business Relationship (defined to arise where (1) a product or service has been purchased by the person from the Consultant within the previous 18 months, (2) an inquiry or application has been made by the person of the Consultant within the previous 6 months, or (3) there is a written contract currently in effect between the person and the Consultant or that has expired within the previous 18 months), they do so on their own behalf and are required to undertake that they will comply with all applicable rules and laws, including: (1) privacy laws, (2) registration with the National Do Not Call List program under the Telecommunications Act rules, (3) maintaining a Do Not Call List so that consumers may request not to be called, and (4) disclosing the following information at the beginning of the call: purpose of the call, a toll-free telephone number for questions or comments about the call, the nature of the product or business interest being promoted, and the identity of the person or organization on whose behalf the call is made, the price of any product being promoted and any material restrictions, terms or conditions applicable to its delivery. Consultants are not permitted to make or send any other unsolicited telephone calls or unsolicited faxes. CUMULATIVE REMEDIES/WAIVER All rights, powers and remedies given to Jamberry Canada are cumulative, not exclusive and in addition to any and all other rights and remedies provided by law. No failure or delay of Jamberry Canada to exercise any power or right under this Agreement or to insist upon strict compliance by you with any obligation or provision shall constitute a waiver of Jamberry Canada’s right to demand exact compliance therewith. Waiver by Jamberry Canada can be effective only in writing by an authorized officer of Jamberry Canada. INJUNCTIVE RELIEF Upon any breach of the Consultant Agreement by the Consultant, Jamberry Canada will be immediately and irreparably harmed and cannot be made whole solely by monetary damages. Because the remedy at law for any breach of any provision of the Consultant Agreement shall be inadequate, in addition to any other remedies in law or in equity that it may have, Jamberry Canada shall be entitled, without the necessity of proving actual damages, to temporary and permanent injunctive relief to prevent the breach of any provision of this Agreement and/or to compel specific performance of this Consultant Agreement. In addition, Jamberry Canada shall be entitled to its costs and expenses, including reasonable attorneys’ fees, in enforcing its rights under the Consultant Agreement. 43 WAIVER Jamberry Canada maintains its right to insist on compliance with these Policies & Procedures or with the applicable laws governing the conduct of a business. In the event that we permit a variance of the rules, that permission does not extend to future variances. This provision deals with the concept of “waiver,” and the parties agree that we do not waive any of our rights under any circumstances. JURISDICTION All disputes and claims relating to Jamberry, the Consultant Agreement, the Compensation Plan, the Company’s products, the rights and obligations of the Consultant, or any other claims or cause use of action relating to the performance of either the Consultant or Jamberry Canada under the agreement shall be adjudicated totally and finally in the Province of Ontario or such other location as the Company prescribes. Unless the province in which you live requires the application of its laws and venue, this agreement is governed by the laws of the Province of Ontario, without regard to principles of conflicts of laws. PARTIAL VALIDITY Should any portion of the Consultant Policies & Procedures, the Consultant Agreement or of any other instruments referred to herein or issued by Jamberry Canada be declared invalid by a court of competent jurisdiction, the balance of such rules, applications or instruments shall remain in full force and effect. LIMITATION OF DAMAGES To the extent permitted by law, Jamberry Canada and its affiliates, officers, directors, associates and other representatives shall not be liable for, and the Consultant hereby releases the foregoing from, and waives any claim of loss of profit, incidental special, consequential, or exemplary damages which may arise out of any claim whatsoever relating to the Company’s performance, non-performance, act, or omission with respect to the business relationship or other matters between the Consultant and the Company whether sounding in contract, tort or strict liability. Furthermore, it is agreed that any damage to the Consultant shall not exceed, and is hereby expressly limited to the amount of unsold Jamberry products and services owned or held by the Consultant and commissions, bonuses and overrides. PRIVACY POLICY & CONSENT You understand and agree that certain personal information relating to you and your business will be collected, used and retained by the Company in accordance with the Company’s Privacy Policy, as amended from time to time and otherwise in accordance with state and Canadian federal and provincial privacy laws, and you hereby consent to same. The Company reserves the right to amend or revise the terms of its Privacy Policy without express notice to you, and you consent to any amendments reasonably made. In operating your independent business, you also agree to adopt, implement and disseminate a privacy policy that complies with all state and Canadian federal and provincial privacy laws that your business may be subject to, for which you are solely responsible, and such compliance 44 shall be undertaken at your sole expense. You acknowledge that failure to comply with these terms may result in immediate termination of your Consultant Agreement. Without limiting your sole responsibility to comply with state and federal and provincial privacy laws affecting your business, the Company hereby grants you, at no additional charge, for the term of your Consultant Agreement, the right to copy and use in your business the Company Privacy Policy and related privacy policy consents. ENTIRE AGREEMENT These Policies & Procedures and the Compensation Plan, as each may be amended from time to time, are incorporated into the Jamberry Consultant Agreement and constitute the entire Agreement of the parties regarding their business relationship. COMPANY ADDRESS AND CONTACT INFORMATION Jamberry Nails Canada Limited Partnership Address for Legal Service: 1100 One Bentall Centre 505 Burrard Street, Box 11, Vancouver, British Columbia V7X 1M5 Canada Address for Consultant Services: c/o 1350 West 200 South, Suite A Lindon, Utah 84042 USA Email: [email protected] Tel: 801.796.2205 45
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