Policy and Procedure

Effective February 15th, 2024

TABLE OF CONTENTS

1 INTRODUCTION

1.1 Policies and Compensation Plan Incorporated into Distributor Agreement

1.2 Purpose of Policies

1.3 Changes to the Agreement

1.4 Delays

1.5 Policies and Provisions Severable

1.6 Waiver

2 BECOMING AN DISTRIBUTOR

2.1 Requirements to Become an Distributor

2.2 No Product Purchase Required

2.3 Distributor Benefits

2.4 Term and Renewal of an HIME Business

3 OPERATING AN HIME BUSINESS

3.1 Adherence to the HIME Compensation Plan

3.2 Advertising

3.2.1 General

3.2.2.1 Advertising and Selling Price of Products on the Internet

3.3 Bonus Buying Prohibited

3.4 Business Entities

3.5 Change of Sponsor or Placement

3.6 Unauthorized Claims and Actions

3.6.1 Indemnification

3.6.2 Product Claims

3.6.3 Income Claims

3.7 Retail Establishments

3.8 Trade Shows, Expositions and Other Sales Forums

3.9 Conflicts of Interest

3.9.1 No solicitation and Noncompetition

3.10 Targeting Other Direct Sellers

3.11 Line Switching, Cross-Sponsoring and Enticement

3.12 Errors or Questions

3.13 Governmental Approval or Endorsement

3.14 Holding Applications or Orders

3.15 Identification

3.16 Income Taxes

3.17 Independent Contractor Status

3.18 Insurance

3.19 International Marketing

3.20 Inventory and The 70 Percent Rule

3.21 Adherence to Laws and Ordinances

3.22 One HIME Business Per Distributor and Per Household

3.23 Actions of Household Members or Affiliated Individuals

3.24 Requests for Records

3.25 Sale, Transfer or Assignment of an HIME Business

3.26 Effects of Divorce or Entity Dissolution on the HIME Business

3.27 Sponsoring

3.28 Succession (Death or Incapacity of an Distributor)

3.29 Telemarketing Techniques

4 RESPONSIBILITIES OF DISTRIBUTORS

4.1 Change of Address, Telephone, and E-Mail Addresses

4.2 Continuing Development Obligations

4.2.1 Ongoing Training

4.3 Non-disparagement

4.4 Providing Documentation to Applicants

5 SALES REQUIREMENTS

5.1 Product Sales

5.2 No Territory Restrictions

5.3 Will Call

5.4 Sales Receipts

6 BONUSES AND COMMISSIONS

6.1 Bonus and Commission Qualifications

6.2 Adjustment to Bonuses and Commissions

6.3 Reports

7 PRODUCT GUARANTEES, RETURNS AND INVENTORY REPURCHASE

7.1 Returns Guarantee

7.1.1 Initial Order Returns

7.1.2.1 Requirements

7.1.2.2 Autoship Returns

7.2 Inventory Repurchase Upon Cancellation

7.3 Procedures for All Returns

8 DISPUTE RESOLUTION AND DISCIPLINARY PROCEEDINGS

8.1 Disciplinary Sanctions

8.2 Grievances and Complaints

8.3 Compliance Department

8.4 Mediation

8.5 Arbitration

8.6 Governing Law, Jurisdiction and Venue

9 PAYMENT AND SHIPPING

9.1 Returned Checks

9.2 Restrictions on Third Party Use of Credit Cards and Checking Account Access

9.3 Sales Taxes

10 RECLASSIFICATION & CANCELLATION

10.1 Effect of Cancellation

10.2 Re-Registration Following Cancellation

10.3 Involuntary Cancellation

10.4 Voluntary Cancellation

10.5 Non-renewal

10.6 Credit Card Chargebacks

1 INTRODUCTION

POLICIES AND COMPENSATION PLAN INCORPORATED INTO DISTRIBUTOR AGREEMENT

These Policies and Procedures, in their present form and as amended at the sole discretion of HIME BIO INC. are incorporated into, and form an integral part of, the Agreement. Throughout these Policies, when the term “Agreement” is used, it collectively refers to the HIME Distributor Application and Agreement, these Policies and Procedures, the HIME Compensation Plan, and the HIME Business Entity Application (if applicable). These documents are incorporated by reference into the Agreement (all in their current form and as amended by HIME). It is the responsibility of each Distributor to read, understand, adhere to, and ensure that he or she is aware of and operating under the most current version of these Policies and Procedures. When sponsoring or enrolling a new Distributor, it is the responsibility of the sponsoring Distributor to ensure that the applicant is provided with, or has online access to, the most current version of these Policies and Procedures and the HIME Compensation Plan prior to his or her execution of the Agreement.

PURPOSE OF POLICIES

HIME is a direct sales company that markets its Products through independent Distributors. It is important to understand that the success of all Distributors depends on the integrity of the men and women who market our Products. To clearly define the relationship that exists between Distributors and HIME, and to explicitly set a standard for acceptable business conduct, HIME has established the Agreement. HIME Distributors are required to comply with all of the Terms and Conditions set forth in the Agreement, as well as all federal and local laws governing their HIME business and their conduct.

CHANGES TO THE AGREEMENT

Because national laws, as well as the business environment, periodically change, HIME reserves the right to amend the Agreement and its prices in its sole and absolute discretion. By signing the Agreement, an Distributor agrees to abide by all amendments or modifications that HIME elects to make. Amendments shall be effective 30 days after publication of notice that the Agreement has been modified. Notification of amendments shall be published by one or more of the following methods: (1) posting on the Company’s official website; or (2) electronic mail (e-mail). The continuation of an Distributor’s HIME business or an Distributor’s acceptance of bonuses or commissions constitutes acceptance of any and all amendments.

DELAYS

HIME shall not be responsible for delays or failures in performance of its obligations when performance is made commercially impracticable due to circumstances beyond its reasonable control. This includes, without limitation, strikes, labor difficulties, riot, war, fire, death, curtailment of a party’s source of supply, or government decrees or orders.

POLICIES AND PROVISIONS SEVERABLE

If any provision of the Agreement, in its current form or as may be amended, is found to be invalid or unenforceable for any reason, only the invalid portion(s) of the provision shall be severed and the remaining terms and provisions shall remain in full force and effect. The severed provision, or portion thereof, shall be reformed to reflect the purpose of the provision as closely as possible.

WAIVER

The Company never gives up its right to insist on compliance with the Agreement and with the applicable laws governing the conduct of a business. No failure of HIME to exercise any right or power under the Agreement or to insist upon strict compliance by an Distributor with any obligation or provision of the Agreement, and no custom or practice of the parties at variance with the terms of the Agreement, shall constitute a waiver of HIME’s right to demand exact compliance with the Agreement. Waiver by HIME can be effectuated only in writing by an authorized officer of the Company. HIME’s waiver of any particular breach by an Distributor shall not affect or impair HIME’s rights with respect to any subsequent breach, nor shall it affect in any way the rights or obligations of any other Distributor. Nor shall any delay or omission by HIME to exercise any right arising from a breach affect or impair HIME’s rights as to that or any subsequent breach. The existence of any claim or cause of action of an Distributor against HIME shall not constitute a defense to HIME’s enforcement of any term or provision of the Agreement.

2 BECOMING AN DISTRIBUTOR

2.1 REQUIREMENTS TO BECOME AN DISTRIBUTOR

To become an HIME Distributor, each applicant must:

Be of the age of majority in his or her country of residence;
Reside in a country that HIME has officially announced is open for business.
Have a valid National Registry I.D. Card
Purchase an HIME Starter Kit
Submit a properly completed Distributor Application and Agreement to HIME either in hard copy or online format, and,
The Company must accept the Agreement.

2.2 NO PRODUCT PURCHASE REQUIRED

Except for the purchase of a Starter Kit that is sold to Distributors at the company’s cost, no person is required to purchase HIME Products to become an Distributor. To familiarize new Distributors with HIME Products, sales techniques, sales aids, and other matters, the Company does require that they purchase a Starter Kit. HIME will repurchase Resalable kits from any Distributor who terminates his or her Distributor Agreement pursuant to the terms of Section 7.2.

2.3 DISTRIBUTOR BENEFITS

Once an Distributor Application and Agreement has been accepted by HIME, the benefits of the Compensation Plan and the Distributor Agreement are available to the new “Distributor.” These benefits include the right to:

Sell HIME Products;
Participate in the HIME Compensation Plan (receive bonuses and commissions, if eligible);
Sponsor other individuals as Preferred Customers or Distributors into the HIME business and thereby build a marketing organization and progress through the HIME Compensation Plan;
Receive periodic HIME literature and other HIME communications;
Participate in HIME-sponsored support, service, training, motivational, and recognition functions, upon payment of appropriate charges, if applicable; and
Participate in promotional and incentive contests and programs sponsored by HIME for its Distributors.

2.4 TERM AND RENEWAL OF AN HIME BUSINESS

The term of the Distributor Agreement is one year from the date of its acceptance by HIME (subject to cancellation pursuant to Section 10 below). Distributors must renew their Distributor Agreement each year by placing 1 extra order with 100PV before the anniversary date of their Distributor Agreement. If this extra order is not placed before the expiration of the current term of the Distributor Agreement, the Distributor Agreement may be suspended without notice.

3 OPERATING AN HIME BUSINESS

3.1 ADHERENCE TO THE HIME COMPENSATION PLAN

Distributors must adhere to the terms of the HIME Compensation Plan as set forth in official HIME literature. Distributors shall not offer the HIME opportunity through, or in combination with, any other system, program, or method of marketing other than that specifically set forth in official HIME literature. Distributors shall not require or encourage other current or prospective Preferred Customers or Distributors to participate in HIME in any manner that varies from the program as set forth in official HIME literature. Distributors shall not require or encourage other current or prospective Preferred Customers or Distributors to execute any agreement or contract other than official HIME agreements and contracts to become an HIME Distributor. Similarly, Distributors shall not require or encourage other current or prospective Preferred Customers or Distributors to make any purchase from, or payment to, any individual or other entity to participate in the HIME Compensation Plan other than those purchases or payments identified as recommended or required in official HIME literature.

3.2 ADVERTISING

3.2.1 General

All Distributors shall safeguard and promote the good reputation of HIME and its Products. The marketing and promotion of HIME, the HIME opportunity, the Compensation Plan, and HIME Products shall be consistent with the public interest and must avoid all fraudulent, coercive, harassing, unconscionable, illegal, discourteous, deceptive, misleading, unethical or immoral conduct or practices. To promote both the Products and the opportunity HIME offers, Distributors should use the sales tools and support materials produced by HIME or approved by HIME. HIME has carefully designed its Products, Product labels, Compensation Plan, and promotional materials to ensure that each aspect of HIME is fair, truthful, substantiated, and complies with the vast and complex legal requirements of legal requirements of national and local laws. Accordingly, Distributors must submit all written sales tools, promotional materials, advertisements, and other literature to the Company for approval. Distributors may not use such tools unless written approval is received. A Distributor may only use a celebrity endorsement, including those celebrities who have endorsed the Product on a corporate level, with written approval from the Company and the specific, prior written approval of the endorsing celebrity for each use of the celebrity’s name or likeness. HIME Distributors who have achieved the rank of 1-Diamond or higher are permitted to create and sell, or to sponsor those who create and sell, sales aids or other promotional items to other HIME Distributors. Such sales aids must have been previously approved by the Company and must not make any impermissible claims. Only Distributors who have achieved the rank of 1-Diamond or higher and are in good standing with the Company are allowed to sell or to sponsor those who sell such aids. The Company reserves the right to approve or deny the right to sell such aids in its sole discretion. All sales tools that receive approval will be given a unique approval number and logo that must be displayed as part of the tool. The tool must indicate that it is from an HIME independent Distributor and may not imply that it is a tool produced by the Company. Any sales tools that involve online web services or online web pages must receive prior approval from the Company and must comply with the policies governing Internet advertising in section 3.2.2. Other electronic media or tools, such as mobile phone apps, may be sold upon written approval from the Company. HIME reserves the right to charge a royalty fee for the use of its trademarks, logos, and other intellectual property. HIME further reserves the right to rescind approval for any sales tools, promotional materials, advertisements, or other literature, and Distributors waive all claims for damages or remuneration arising from or relating to such rescission, including claims that the Company has created a similar tool for all Distributors. HIME Distributors are not permitted to sell or promote any sales tools at HIME sponsored events. HIME Distributors are not permitted to sell sales tools that require a regular subscription fee or any other recurring payment. Items that are not sales tools but are promotional items that use HIME trademarks and logos, such as hats or T-shirts, may be produced in limited quantities but must first receive permission from the Company.

3.2.2 Internet Advertising

Subject to the provisions of Section 3.2.2(G) herein, Distributors may use only a Company Licensed Website or on-line shopping center or QR code to promote Product or the business opportunity over the Internet. Promoting Product or the business opportunity through an unlicensed Internet website is strictly prohibited. Distributors that wish to operate a Company Licensed Website or on-line shopping center or QR code must meet the following criteria:

A Distributor must enter into a website licensing agreement with the Company.
All licensed websites are subject to a one-time initial order with 100~500 PV. These requests are necessary for the Company to provide training and personnel to monitor Distributor Internet websites for compliance with these Policies and Procedures. c.
Licensed websites must be Company-specific and may not advertise, promote, or link to any other product or opportunity. However, all such sites, and any changes thereto, must first be reviewed and approved by the Company. If approved, the Distributor must enter into a licensing agreement with the Company and the site must display a Company-generated “licensed” designation. Changes made to the site after obtaining the initial license require written authorization from a representative of the Company’s Compliance Department.
Distributors may not use any key words or meta tags to advertise any licensed website on the Internet if the search words or meta tags explicitly or implicitly present illegal or unsubstantiated health or income claims.
The Company may revoke the license for any previously approved website at any time and for any reason, including changes to federal and local laws and regulations.
The Company may revoke the license for any previously approved website at any time and for any reason, including changes to federal and local laws and regulations.
Distributors may promote the business opportunity and Products on social networking sites such as “Facebook” and “Twitter;” video sites such as “YouTube” and “Google Video;” and blogging sites such as “Blogger” (collectively “Social Media Sites”), without complying with Sub-Clauses A through F, provided the following conditions are met:

All text, audio and video postings do not contain Product or income claims. For Product information, Distributors may refer viewers to their HIME replicated website, the Company website, or a Company Licensed Website;
Videos posted to Social Media Sites show the text “HIME Independent Distributor” for the entirety of the video; and
The Company may monitor the Social Media Sites for compliance with the Contract and Distributor agrees to immediately remove or modify the Social Media Sites upon the Company’s request to comply with the Agreement.

3.2.2.1 Advertising and Selling Price of Products on the Internet

Each Distributor acknowledges and agrees that the advertising and selling of all Products on the Internet may only be done on a Company Licensed Website, and the advertising and selling price of all Products on such website (i) if sold to an applicant who wishes to be an Distributor, must not be lower than the wholesale price of the Products plus reasonable shipping and the amount the Company charges for taxes and handling, and the applicant must also be charged the Distributor Starter Kit fee; and (ii) if sold to a non-applicant (e.g. Customer, etc.), must not be lower than the Company’s suggested retail price plus reasonable shipping and the amount the Company charges for taxes and handling of the Product. In connection with this Section, the Distributor also agrees that all advertising regarding the price of Products will be truthful, will not contain misleading statements (e.g. “lowest price available” which infers that an Distributor is able to sell the Products at a price lower than other Distributors, etc.) and will not knowingly omit any material particular relating to the Product. Distributor acknowledges and agrees that he or she shall not advertise or sell any Product on the Internet which was purchased from another Distributor. Any violation of this Section by an Distributor shall constitute a breach of the Agreement and will be subject to the breach of Agreement procedures set forth herein.

3.2.3 Sales on Online Auction Sites Prohibited

Distributors may not advertise, promote the sale of, sell or attempt to sell HIME Products on any online auction or classified ad site including, without limitation, eBay, Shopee, Craig’s List, or Amazon. Violation of this policy may result in any of the disciplinary sanctions set forth herein including the involuntary cancellation of the Agreement.

3.2.4 Cancellation of a Distributor’s HIME Business

If an Distributor’s HIME business is canceled for any reason, the former Distributor must discontinue using the HIME name and all of HIME’s trademarks, trade names, service marks, and other intellectual property, and all derivatives of such marks and intellectual property, in any postings and all Social Media sites that the former Distributor utilized.

3.2.5 Trademarks and Copyrights

HIME will not allow the use of its trade names, trademarks, designs, or symbols by any person, including HIME Distributors, without its prior written permission. Distributors may not produce for sale or distribution any recorded Company events and speeches without written permission from HIME, nor may Distributors reproduce for sale or for personal use any recording of Company-produced audio or video tape presentations.

3.2.6 Media and Media Inquiries

3.2.7 Unsolicited Email

HIME does not permit Distributors to send unsolicited commercial emails unless such emails strictly comply with applicable laws and regulations including, without limitation, the Second Schedule to the SCA on requirements for unsolicited commercial electronic messages. Any email sent by a Distributor that promotes HIME, the HIME opportunity, or HIME Products must comply with the following:

There must be an accurate and functioning return email address to the sender which is valid and capable of receiving all opt-out requests at all times during a period of at least 30 days after the email is sent.
There must be a clear and conspicuous notice in the email in the English or other language that advises the recipient that he or she may reply to the email, via the functioning return email address, to request that future email solicitations or correspondence not be sent to him or her (a functioning “opt-out” notice).
The email must clearly and conspicuously disclose that the message is an advertisement or solicitation, with the letters “” with a space before the title in the subject field.
The email must clearly and conspicuously disclose that the message is an advertisement or solicitation.
The use of deceptive subject lines and/or false header information is prohibited.
All opt-out requests, whether received by email or regular mail, must be honored within ten (10) days of receipt. If an Distributor receives an opt-out request from a recipient of an email, the Distributor must forward the opt-out request to the Company. HIME may periodically send commercial emails on behalf of Distributors. By entering into the Distributor Agreement, Distributor agrees that the Company may send such emails and that the Distributor’s physical and email addresses will be included in such emails as outlined above. Distributors shall honor opt-out requests generated as a result of such emails sent by the Company.

3.2.8 Unsolicited Faxes

Except as provided in this section, Distributors may not use or transmit unsolicited faxes relative to the operation of their HIME businesses. The term “unsolicited faxes” means the transmission via telephone facsimile of any material or information advertising or promoting HIME, its Products, its Compensation Plan or any other aspect of the company which is transmitted to any person, except that these terms do not include a fax or e-mail: (a) to any person with that person’s prior express invitation or permission; or (b) to any person with whom the Distributor has an established business or personal relationship and who has additionally consented to his/personal data being used or processed for such purpose in question. The term “established business or personal relationship” means a prior or existing relationship formed by a voluntary two-way communication between an Distributors and a person, on the basis of (a) an ongoing relationship between the Distributor and the persons where the person has executed a written contract with the Distributor to receive services and/or products from the Distributor on an ongoing basis for the duration of the contract and such contract has not expired; or (b) a personal or familial relationship, which relationship has not been previously terminated by either party.

3.2.9 Other Sales Media

Upon approval from HIME’s Customer Service Department, HIME Product(s) may be sold and/or promoted through catalogs and other mass sales mediums, such as magazines, infomercials, television, radio, and other related sales media. Distributors may also advertise with a vehicle wrap, using images approved by HIME. To begin the approval process, please contact [email protected].

3.3 BONUS BUYING PROHIBITED

Bonus Buying is strictly and absolutely prohibited. “Bonus Buying” includes: (a) the enrollment of individuals or entities without the knowledge of and/or execution of an Agreement by such individuals or entities; (b) the fraudulent enrollment of an individual or entity as an Distributor or Preferred Customer; (c) the enrollment or attempted enrollment of non-existent individuals or entities as Distributors or Preferred Customers (“phantoms”); (d) Purchasing HIME Products on behalf of another Distributor or Preferred Customer, or under another Distributor’s or Preferred Customer’s I.D. number, to qualify for commissions or bonuses; (e) purchasing excessive amounts of goods that cannot reasonably be used or resold in a month; and/or (f) any other mechanism or artifice to qualify for rank advancement, incentives, prizes, commissions or bonuses that is not driven by bona fide Product purchases by end user consumers.

3.4 BUSINESS ENTITIES

A corporation, partnership or trust (collectively referred to in this section as a “Business Entity”) may apply to be an HIME Distributor by submitting its Certificate of Incorporation, Partnership Agreement or trust documents (these documents are collectively referred to as the “Entity Documents”) to HIME, along with a properly completed Business Entity Registration form.

3.4.1 Changes to a Business Entity

Each Distributor must immediately notify HIME of all changes to type of business entity they utilize in operating their businesses and the addition or removal of business Distributors. All changes must be submitted by December 31th to become effective for the calendar year in which the change was made.

3.5 CHANGE OF SPONSOR OR PLACEMENT

To protect the integrity of all marketing organizations and safeguard the hard work of all Distributors, HIME strongly discourages changes in sponsorship or placement.

3.5.1 Mis-Sponsorship

In cases in which the new Distributor is sponsored by someone other than the individual he or she was led to believe would be his or her Sponsor, a Distributor may request that he or she be transferred to another organization with his or her entire marketing organization intact. Requests for transfer under this policy will be evaluated on a case-by-case basis and must be made within seven (7) business days from the date of enrollment. The Distributor requesting the change has the burden of proving that he or she was placed beneath the wrong sponsor. It is up to HIME’s discretion whether the requested change will be implemented.

3.5.2 Mis-placement

In those instances, in which a new Distributor is placed in a location in the binary structure that is different than what either the new Distributor or his or her Sponsor intended (e.g., the new Distributor was intended to be placed on the Left but was misplaced on the Right), the Distributor may request that he or she be placed in the correct location. Such a request for transfer pursuant to this policy must be made within three (3) business days from the date of enrollment. The Distributor requesting the change has the burden of proving that he or she was placed in the incorrect location. HIME will approve or not approve the change at its discretion.

3.5.3 Upline Approval

The Distributor seeking to transfer submits a properly completed and fully executed Sponsorship Transfer Form which includes the signed approval of all parties whose income will be affected by the transfer. Photocopied or facsimile signatures are not acceptable. If the transferring Distributor also wants to move any of the Distributors in his or her marketing organization, each downline Distributor must also obtain a properly completed Sponsorship Transfer Form and return it to HIME. Downline Distributors will not be moved with the transferring Distributor unless all of the requirements of this paragraph are met. Transferring Distributors must allow thirty (30) days after the receipt of the Sponsorship Transfer Forms by HIME for processing and verifying change requests. In cases wherein the appropriate sponsorship change procedures have not been followed and a downline organization has been developed in the second business by a Distributor, HIME reserves the sole and exclusive right to determine the final disposition of the downline organization. Resolving conflicts over the proper placement of a downline that has developed under an organization that has improperly switched sponsors is often extremely difficult.

3.5.4 Cancellation and Re-application

A Distributor may legitimately change organizations by voluntarily canceling his or her HIME Distributor Agreement and remaining inactive for 12 full calendar months. During the 12 month period of inactivity, the former Distributor may not participate in any form of Distributor activity including, but not limited to, purchasing HIME Products for resale, selling HIME Products, sponsoring other HIME Distributors, attending any HIME functions, attending any HIME-related functions sponsored by HIME Distributors, operating or assisting in the operation of an HIME Distributor’s HIME business, performing any activity or function that is normally performed by an HIME Distributor or such Distributor’s employees, or any other activity that in the sole discretion of the Company constitutes a meaningful promotion of the HIME business. Following the 12-month period of inactivity, the former Distributor may reapply under a new sponsor; however, HIME may, at its discretion accept or deny the application. The former Distributor’s downline will remain in their original line of sponsorship. Any attempt to cross recruit may result in disciplinary action.

3.6 UNAUTHORIZED CLAIMS AND ACTIONS

3.6.1 Indemnification

A Distributor is fully responsible for all of his or her verbal and written statements made regarding HIME Products and the Compensation Plan which are not expressly contained in official HIME materials. Distributors agree to indemnify HIME and HIME’s directors, officers, employees, and agents, and hold them harmless from any and all liability and/or loss (whether direct or indirect, consequential or economic loss) including judgments, civil and/or criminal penalties, damages, refunds, legal advice fees, court costs, or lost business incurred by or imposed on HIME as a result of the Distributor’s unauthorized representations or actions. This provision shall survive the termination of the Agreement.

3.6.2 Product Claims

No claims (which include personal testimonials) as to therapeutic, curative, or beneficial properties of any Products offered by HIME may be made except those contained in official HIME literature. In particular, no Distributor may make any claim that HIME Products are useful in the cure, treatment, diagnosis, mitigation or prevention of any diseases. Such statements can be perceived as medical or drug claims. Not only do such claims violate HIME policies, but they potentially violate national and local laws and regulations.

3.6.3 Income Claims

In their enthusiasm to enroll prospective Distributors, some Distributors are occasionally tempted to make income claims or earnings representations to demonstrate the inherent power of network marketing. This is counterproductive because new Distributors may become disappointed if their results are not as extensive or as rapid as the results others have achieved. The HIME income potential is great enough to be highly attractive without reporting the earnings of others. Moreover, there are laws, Codes and regulations that regulate or even prohibit certain types of income claims and testimonials made by persons engaged in network marketing. While Distributors may believe it beneficial to provide copies of checks, or to disclose the earnings of themselves or others, such approaches have legal consequences that can negatively impact HIME as well as the Distributor making the claim unless appropriate disclosures required by law are also made contemporaneously with the income claim or earnings representation. Because HIME Distributors do not have the data necessary to comply with the legal requirements for making income claims, an Distributor, when presenting or discussing the HIME opportunity or Compensation Plan to a prospective Distributor, may not make income projections, income claims, or disclose his or her HIME income (including the showing of checks, copies of checks, bank statements, or tax records).

3.7 RETAIL ESTABLISHMENTS

Distributors may not sell or promote HIME Products or the business opportunity through a Retail Establishment. Distributors are also prohibited from selling Products to any person who the Distributor knows, or who has reason to suspect, will ultimately sell the Products through Retail Establishments.

3.7.1 Service-related Establishments

Distributors may sell the Products through approved Service-related Establishments. An approved Service-related Establishment is an establishment that requires a membership and/or an appointment, and the services performed are health and wellness related. Examples of approved Service-related Establishments include, but are not limited to, chiropractor offices, salons, acupuncture clinics, and gyms. Products can only be sold through a Service-related Establishment if the owner of the establishment is an Distributor. Additionally, Service-related establishments are limited to small chains or franchises with no more than five stores or physical locations. Advertising in such an approved Service related Establishment is limited to Products and official HIME materials, which may be displayed only in the private membership and/or appointment area of the establishment. No sales tools or signage may be visible from the outside of the establishment. Advertising of HIME or the HIME opportunity is not permitted in any other type of commercial establishment. Before selling any Product through a service-related establishment, the Distributor must provide the name and physical location(s) of the establishments to Compliance via email at [email protected]. HIME has sole discretion in determining whether an establishment is a Service-related Establishment and a proper place for the sale of Products.

3.8 TRADE SHOWS, EXPOSITIONS AND OTHER SALES FORUMS

Distributors may display and/or sell HIME Products at trade shows and professional expositions. Before submitting a deposit to the event promoter, Distributors must contact the Distributor Education and Conduct Department in writing for conditional approval, as HIME’s policy is to authorize only one HIME business per event. Final approval will be granted to the first Distributor who submits an official advertisement of the event, a copy of the contract signed by both the Distributor and the event official, and a receipt indicating that a deposit for the booth has been paid. Approval is given only for the event specified. Any requests to participate in future events must again be submitted to the Customer Service Department. HIME further reserves the right to refuse authorization to participate at any function which it does not deem a suitable forum for the promotion of its Products or the HIME opportunity. Approval will not be given for swap meets, garage sales, flea markets or farmer’s markets as these events are not conducive to the professional image HIME wishes to portray.

3.9 CONFLICTS OF INTEREST

3.9.1 No solicitation and Noncompetition

HIME Distributors are free to participate in other direct-selling or network marketing business ventures or marketing opportunities (collectively “Network Marketing”). However, Distributors may not directly or indirectly Recruit other HIME Distributors for any other Network Marketing business. This includes general solicitations on social networking sites where “friends” include persons not personally sponsored by the Distributor and who are already HIME Distributors. An Distributor who participates in another Network Marketing business agrees to operate his or her HIME Distributorship entirely separate and apart from the other Network Marketing business. Accordingly, Distributors who choose to participate in other Network Marketing businesses agree that they shall not:

display any non-HIME Product(s) and/or sales aids with, or in the same location as HIME Product(s) and/or sales aids, including web pages;
offer any non-HIME program, opportunity, Product, or service in conjunction with the HIME opportunity or Product(s) to prospective or existing Customers or Distributors; or
offer any non-HIME opportunity, Products, or services at any HIME-related meeting, seminar or convention, or within two hours an 8 kilometers radius of the HIME event. If the HIME meeting is held telephonically or on the internet, any non-HIME meeting must be at least two hours before or after the HIME meeting, and on a different conference telephone number or internet web address from the HIME meeting.

3.9.2 No solicitation after Termination

Following the cancellation of a Distributor’s independent Agreement, and for a period of one (1) year thereafter, with the exception of a Distributor who was personally sponsored by the former Distributor, the former Distributor may not Recruit any HIME Distributor for another network marketing business. If a Distributor did not personally sponsor another Distributor on his or her first level, he or she is prohibited, for one (1) year following the date of cancellation of the agreement, from Recruiting that Distributor to sell or purchase Products or services other than those offered by HIME. Distributors and the Company recognize that because network marketing is conducted through networks of independent contractors dispersed across the entire United States and internationally, and business is commonly conducted via the internet and telephone, an effort to narrowly limit the geographic scope of this non-solicitation provision would render it wholly ineffective. Therefore, Distributors and HIME agree that this non-solicitation provision shall apply to all markets in which HIME conducts business. This shall survive termination of the Agreement.

3.9.3 Definition of “Recruit”

For purposes of these Policies and Procedures, the term “Recruit” means the actual or attempted sponsorship, solicitation, enrollment, encouragement, or effort to influence in any other way, either directly, indirectly, or through a third party, another HIME Distributor to enroll or participate in another direct-selling, network marketing or direct sales opportunity. The conduct described in the preceding sentence constitutes recruiting even if the Distributor’s actions are in response to an inquiry made by another Distributor or Preferred Customer.

3.9.4 Confidential Information

Notwithstanding any other provision of the Agreement, the Distributor shall never use HIME trade secrets and other Confidential Information, as further described herein, to solicit, recruit whether directly or indirectly, other HIME Distributors or Customers to any other Network Marketing business. “Confidential Information” is information disclosed to Distributors pursuant to the agreement including, but not limited to, information regarding (1) downline organizations or upline Distributors, including Distributor names and contact information, customer information, and (2) customer lists, business reports, commission or sales reports, business plans, projections, trade secrets, intellectual property, analyses, and related information and other financial and business information that would be reasonably understood to be confidential and/or give competitive advantage. Distributor access to such Confidential Information is confidential and constitutes proprietary information and business trade secrets belonging to HIME. Such Confidential Information is provided to Distributors in strictest confidence and is made available to Distributors for the sole purpose of assisting them in working with their respective Marketing Organizations in the development of their HIME business. Distributors may not use any Confidential Information for any purpose other than for developing their independent HIME businesses. Where a Distributor participates in other direct selling the Distributor may not be eligible, at the discretion of HIME, to have access to certain Confidential Information. Distributors may use the Confidential Information to assist, motivate, and train their downline Distributors, and for no other purpose. In so doing, a Distributor may not disclose any of HIME’s Confidential Information to any third party, including, without limitation, his or her downline Distributors. The Distributor and HIME agree that, but for this agreement of confidentiality and nondisclosure, HIME would not provide Confidential Information to the Distributor. To protect the Confidential Information, a Distributor shall not, on his or her own behalf, or on behalf of any other person, partnership, association, corporation or other entity:

Directly or indirectly disclose any Confidential Information to any third party;
Directly or indirectly disclose the password or other access code to his or her back-office;
Use any Confidential Information to compete with HIME or for any purpose other than promoting his or her HIME business; or
Recruit or solicit any Distributor or customer of HIME listed on any report or in the Distributor’s back-office, or in any manner attempt to influence or induce any Distributor or Preferred Customer of HIME, to alter their business relationship with HIME.

The obligation of a Distributor to not disclose any Confidential Information shall survive cancellation or termination of the Agreement and shall remain effective and binding irrespective of whether the Agreement has been terminated, or whether the Distributor is or is not otherwise affiliated with the Company, and is subject to legal enforcement by injunction and award of costs and fees necessarily incurred.

3.9.5 Information Gathered in the Promotion of the HIME Business

Distributors agree that information gathered by an Distributor about other Distributors by virtue of their association with HIME, or in connection with their promotion of HIME Product or sales materials, is considered proprietary information that belongs to HIME, and Distributors are bound to the non-disclosure provisions at Section 3.9.4 of these policies and procedures in relation to this information.

3.10 TARGETING OTHER DIRECT SELLERS

HIME does not condone Distributors specifically or consciously targeting the sales force of any other direct sales company to sell HIME Products or to become Distributors for HIME. Nor does HIME condone the solicitation or enticement, by an Distributor, of any of the members of the sales force of another direct sales company to violate the terms of their contract with such other company. Should an Distributor engage in such activity, the Distributor bears the risk of being sued by the other direct sales company. If any lawsuit, arbitration or mediation is brought by another company against an Distributor alleging that he or she engaged in inappropriate recruiting activity of its sales force or customers, HIME will not pay any of such an Distributor’s defense costs or legal fees, nor will HIME indemnify the Distributor for any judgment, award, or settlement. Distributors agree to indemnify HIME and HIME’s directors, officers, employees, and agents, and hold them harmless from any and all liability and/or loss (whether direct or indirect, consequential or economic loss) including judgments, civil and/or criminal penalties, damages, refunds, legal advice fees, court costs, or lost business incurred by or imposed on HIME as a result of any breach of the terms of this Section 3.10 by that Distributor.

3.11 LINE SWITCHING, CROSS-SPONSORING AND ENTICEMENT

Distributors agree that maintaining the integrity of the line of sponsorship in a Distributorship organization is fundamental to network marketing. Accordingly, the Distributor agrees to not engage in Line Switching, Cross Sponsoring, and/or Enticement. “Line Switching” means applying for and becoming an Distributor

when already a Distributor,
when holding a beneficial interest in another Distributorship; and/or
when less than six (6) months have passed since having been an Distributor or having held a beneficial interest in another Distributorship. “Cross-Sponsoring” means the enrollment of another Distributor (including an Distributor whose Agreement was terminated within the preceding six (6) months or has sponsored or purchased Product in the preceding six (6) months) to a different line of sponsorship. “Enticement” means soliciting, encouraging, offering benefits, or in any way aiding another Distributor to Line Switch and/or Cross-Sponsor, or encouraging a current Distributor to terminate and then sign up in a new position in compliance with the policies as outlined in the section above or to acquire a current HIME business. Distributors shall not use a spouse’s or relative’s name, trade names, assumed or fictitious names, legal entities, false government issued identification numbers, or fictitious ID numbers to circumvent this policy. Because Line Switching, Cross Sponsoring, and Enticement can be detrimental to everyone involved, any Distributor who believes or has reason to believe that another Distributor is in violation of this policy has an affirmative obligation to notify HIME of such violation as soon as reasonably possible. Should any Distributor breach these covenants, HIME may take any or all of the following actions:
termination of the Agreement of the Distributor(s) in breach;
b. terminate the Agreement(s) of the Distributor(s) enrolled as a result of Line Switching. HIME is under no obligation to carry out any actions and the ultimate disposition of the organization remains within the sole discretion of HIME.

Distributors in violation of this policy waive all claims against HIME that arise from or relate to the disposition of such Distributorships.

3.12 ERRORS OR QUESTIONS

If a Distributor has questions about or believes any errors have been made regarding commissions, bonuses, Downline Activity Reports, or charges, the Distributor must notify HIME in writing within 60 days of the date of the purported error or incident in question. HIME will not be responsible for any errors, omissions or problems not reported to the Company within 60 days.

3.13 GOVERNMENTAL APPROVAL OR ENDORSEMENT

Neither governmental body or departments approve or endorse any direct selling or network marketing companies or programs. Therefore, Distributors shall not represent or imply that HIME or its Compensation Plan have been “approved,” “endorsed” or otherwise sanctioned by any government or other regulatory agency.

3.14 HOLDING APPLICATIONS OR ORDERS

Distributors must not manipulate enrollments of new applicants and purchases of Products. All Distributor Applications and Agreements, and Product orders must be sent to HIME within 72 hours from the time they are signed by a Distributor or placed by a customer, respectively.

3.15 IDENTIFICATION

All Distributors are required to provide their standard government id to HIME on the Distributor Application and Agreement. Upon enrolment, the Company will provide a unique Distributor Identification Number to the Distributor by which he or she will be identified. This number will be used to place orders, and track commissions and bonuses. 3.16 INCOME TAXES

Each Distributor is responsible for paying taxes on any income generated as an Independent Distributor Every year as appropriate to them and their market.

3.17 INDEPENDENT CONTRACTOR STATUS

Distributors are independent contractors and are not purchasers of a franchise or a business opportunity. The agreement between HIME and its Distributors does not create an employer/employee relationship, agency, partnership, or joint venture between the Company and the Distributor. Distributors shall not be treated as an employee for his or her services or for tax purposes. All Distributors are responsible for paying relevant and/or applicable taxes due from all compensation earned. The Distributor has no authority (expressed or implied), to bind the Company to any obligation. Each Distributor shall establish his or her own goals, hours, and methods of sale, so long as he or she complies with the terms of the Agreement, these Policies and Procedures, and applicable laws. The name of HIME and other names as may be adopted by HIME are proprietary trade names, trademarks and service marks of HIME. As such, these marks are of great value to HIME and are supplied to Distributors for their use only in an expressly authorized manner. Use of HIME name on any item, including, but not limited to, email addresses, URL and business names, not produced by the Company is prohibited unless otherwise approved by HIME.

3.18 INSURANCE

Distributors may wish to arrange insurance coverage for their business. Homeowner’s insurance policies typically do not cover business-related injuries or the theft of or damage to inventory or business equipment. Contact an insurance agent to make certain that business property is protected. This can often be accomplished with a simple “Business Pursuit” endorsement attached to a homeowner’s policy.

3.19 INTERNATIONAL MARKETING

Distributors are authorized to sell HIME Products and enroll Preferred Customers or Distributors in any country that the Company has officially sanctioned to be open and available to all Distributors for conducting business. HIME may specify certain countries subject to a “Pre-Launch Period” in which Distributors may also conduct the Distributor Business. The Company may formally announce a Pre-Launch Period at least thirty (30) days prior to the official opening. A Distributor has no authority to and shall not conduct the HIME business nor introduce or establish the Company’s business or Product in any country that has not been officially sanctioned to be open and available to all Distributors for conducting business or any country that is not the subject of a Pre-Launch Period announcement from the Company. This includes, but is not limited to: any attempts to secure approval for Products or business practices; register or reserve the Company names, trademarks, trade names, or Internet domain names; or establish any kind of business or governmental contact on behalf of the Company. A Distributor may not ship Product or sales aids into any unauthorized country.

3.20 INVENTORY AND THE 70 PERCENT RULE

The Company imposes no specific minimum inventory requirement on Distributors. A Distributor must use his or her own judgment to determine the amount of inventory needed to sustain the Distributor’s projected retail sales and personal use. Distributors are prohibited from ordering and must not attempt to influence any other Distributor to buy more than a reasonable amount of inventory. By placing an order, an Distributor certifies that he or she has sold or consumed at least 70 percent of the Distributor’s total inventory from previous orders.

3.21 ADHERENCE TO LAWS AND ORDINANCES

Distributors shall comply with all relevant laws and regulations in the conduct of their businesses. Many local jurisdictions have laws regulating certain home-based businesses. Distributors must obey those laws that do apply to them. If a government or local authority advises an Distributor that a law, by-law or regulation applies to him or her, the Distributor shall be polite and cooperative, and immediately send a copy of the relevant law to HIME Compliance at service@ HIMEbio.com.

3.22 ONE HIME BUSINESS PER DISTRIBUTOR AND PER HOUSEHOLD

A Distributor may operate or have an ownership interest, legal or equitable, as a sole proprietorship, partner, shareholder, trustee, or beneficiary, in only one HIME business. No individual may have, operate, or receive compensation from more than one HIME business. HIME deems all persons residing in the Distributor’s household a Beneficial Interest in their Distributorship. However, if adequate proof can be provided that another adult who is not a spouse is operating a Distributorship separately, HIME may waive this rule until circumstances change. If a Distributor marries another Distributor, no effect will be given to the provisions of this section and the two may maintain separate and independent Distributorships. If a Distributor is receiving the rights to another’s Distributorship upon death, HIME may waive this policy, subject to the succession rules herein.

3.23 ACTIONS OF HOUSEHOLD MEMBERS OR AFFILIATED INDIVIDUALS

If any member of an Distributor’s immediate household engages in any activity which, if performed by the Distributor, would violate any provision of the Agreement, such activity will be deemed a violation by the Distributor and HIME may take disciplinary action pursuant to the Statement of Policies against the Distributor. Similarly, if any individual Distributor in any way with a corporation, partnership, trust or other entity (collectively “affiliated individual”) violates the Agreement, such POLICIES AND PROCEDURES HIME | 15 action(s) will be deemed a violation by the entity, and HIME may take disciplinary action against the entity.

3.24 REQUESTS FOR RECORDS

Any request from a Distributor for copies of invoices, or other records will require a fee of $1 USD per page per copy. This fee covers the expense of mailing and time required to research files and make copies of the records.

3.25 SALE, TRANSFER OR ASSIGNMENT OF AN HIME BUSINESS

Although an HIME business is a privately owned, independently operated business, the sale, transfer or assignment of an HIME business is subject to certain limitations. If an Distributor wishes to sell his or her HIME business, the following criteria must be met:

Protection of the existing line of sponsorship must always be maintained so that the HIME business continues to be operated in that line of sponsorship.
The buyer or transferee must be eligible to become a qualified HIME Distributor. If the buyer or transferee is an active HIME Distributor, he or she must first terminate his or her HIME business and wait 12 calendar months before acquiring any interest in an existing HIME business but may sign up in a new HIME business after waiting six calendar months. If the buyer or transferee is a former HIME Distributor, he or she must wait 12 calendar months from the termination of the prior HIME business before acquiring any interest in an existing HIME business but may sign up in a new HIME business after waiting 12 calendar months.
Before the sale, transfer, or assignment can be finalized and approved by HIME, any debt obligations the selling Distributor has with HIME must be satisfied.
The selling Distributor must be in good standing and not in violation of any of the terms of the Agreement to be eligible to sell, transfer, or assign an HIME business.

Prior to selling an HIME business, the selling Distributor must notify HIME’s Customer Service Department of his or her intent to sell the HIME business by submitting a Sale/Transfer of HIME Business form together with the transfer fee of $1000 USD or equivalent local currency plus applicable taxes. No changes in line of sponsorship can result from the sale or transfer of an HIME business. A Distributor may not sell, transfer, or assign individual business centers; if a business is sold, transferred, or assigned, all business centers must be included in the transaction.

3.26 EFFECTS OF DIVORCE OR ENTITY DISSOLUTION ON THE HIME BUSINESS

HIME Distributors sometimes operate their HIME businesses as husband-wife partnerships, regular partnerships, corporations, or trusts. At such time as a marriage may end in divorce or a corporation, partnership, or trust (the latter three entities are collectively referred to herein as “entities”) may dissolve, arrangements must be made to assure that any divorce or entity dissolution is accomplished so as not to adversely affect the interests and income of other businesses up or down the line of sponsorship. If the separating parties fail to provide for the best interests of other Distributors and the Company in a timely fashion, HIME will involuntarily terminate the Agreement. During the divorce or entity dissolution process, the parties must adopt one of the following methods of operation:

One of the parties may, with consent of the other(s), operate the HIME business pursuant to an assignment in writing whereby the relinquishing spouse, shareholders, partners, or trustees authorize HIME to deal directly and solely with the other spouse or non-relinquishing shareholder, partner, or trustee.
The parties may continue to operate the HIME business jointly on a “business-as-usual” basis, whereupon all compensation paid by HIME will be paid according to the status quo as it existed prior to the divorce filing or dissolution proceedings. This is the default procedure if the parties do not agree on the format set forth above.

Under no circumstances will the Downline Organization of divorcing spouses or a dissolving business entity be divided. Similarly, under no circumstances will HIME split commission and bonus checks between divorcing spouses or members of dissolving entities. HIME will recognize only one Downline Organization and will issue only one commission check per HIME business per commission cycle. Commission checks shall always be issued to the same individual or entity. In the event that parties to a divorce or dissolution proceeding are unable to resolve a dispute over the disposition of commissions and ownership of the business in a timely fashion as determined by the Company, the Agreement shall be involuntarily canceled. If a former spouse has completely relinquished all rights in the original HIME business pursuant to a divorce, he or she is thereafter free to enroll under any sponsor of his or her choosing without waiting 12 calendar months. In the case of business entity dissolutions, the former partner, shareholder, member, or other entity affiliate who retains no interest in the business must wait six calendar months from the date of the final dissolution before re-enrolling as a Distributor. During this 12 month waiting period, such individual must remain inactive as described in Section 3.5.4 above. In either case, however, the former spouse or business affiliate shall have no rights to any Distributors in their former organization or to any former Retail Customer. They must develop the new business in the same manner as would any other new Distributor.

3.27 SPONSORING

All active Distributors in good standing have the right to sponsor and enroll others into HIME. Each prospective Preferred Customer or Distributor has the ultimate right to choose his or her own Sponsor. If two Distributors claim to be the Sponsor of the same new Distributor or Preferred Customer, the Company shall regard the first application received by the Company as controlling the account of the new Distributor.

3.28 SUCCESSION (DEATH OR INCAPACITY OF AN DISTRIBUTOR)

A Distributor may provide in his or her will that his or her independent HIME business will pass to his or her heirs. The Company will honor such bequests provided it is provided with certified copies of the death certificate and appropriate legal documentation establishing the right of the deceased Distributor’s heirs to the business. Successors in interest must submit an amended HIME Agreement to the Company. Otherwise, the Agreement will be terminated. If the legal successor to the Distributorship is already an existing Distributor, the Agreement will be assigned to the existing Distributor and the Company will allow the multiple Beneficial Interest through inheritance. If an Distributor is incapable of operating his or her independent HIME business due to incapacity, the agent, guardian, or trustee of the incapacitated Distributor may operate the incapacitated Distributor’s business on behalf of the incapacitated Distributor upon the submission of appropriate legal documents to the Company. The authorized agent, guardian, or trustee must submit documents to the Company establishing his or her authority to act on behalf of the incapacitated Distributor and proof of such Distributor’s incapacity.

3.29 TELEMARKETING TECHNIQUES

The Personal Data Protection Commission has laws that restrict telemarketing practices and has a “Do Not Call List.” Although HIME does not consider Distributors to be “telemarketers” in the traditional sense of the word, these government regulations broadly define the term “telemarketer” and “telemarketing” so that an inadvertent action of calling someone whose telephone number is listed on the federal “do not call” registry could cause the Distributor to violate the law. Moreover, these regulations must not be taken lightly, as they carry significant penalties (up to $11,000 USD per offense). Therefore, Distributors must not engage in telemarketing in the operation of their HIME businesses. The term “telemarketing” means the placing of one or more telephone calls to an individual or entity to induce the purchase of an HIME product, or to recruit them for the HIME opportunity. “Cold calls” made to prospective customers or Distributors that promote either HIME’s products or the HIME opportunity constitute telemarketing and are prohibited. However, a telephone call(s) placed to a prospective customer or Distributor (a “prospect”) is permissible under the following situations:

The Distributor understands the prohibitions and requirements of US’s Personal Data Protection Act (“PDPA”) and its Do Not Call regulations;
the Distributor maintains its own “Do-Not-Call” lists that record the number(s) of any person or entity that requests that they not be contacted; and
must not collect, use, disclose or process that person’s personal data and must not contact that person unless that person had prior to the contact being made by the Distributor in question given the Distributor his prior express consent to allow the Distributor to use his personal data for such purpose. In addition, Distributors shall not use automatic telephone dialing systems relative to the operation of their HIME businesses. 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.

4 RESPONSIBILITIES OF DISTRIBUTORS

4.1 CHANGE OF ADDRESS, TELEPHONE, AND E-MAIL ADDRESSES

To ensure timely delivery of Products, support materials, and commission checks, it is critically important that the HIME’s files are current. Street addresses are required for shipping. Distributors planning to change their e-mail address or move must send their new address and telephone numbers to HIME’s Corporate Offices to the attention of the Customer Service Department. To guarantee proper delivery, two weeks’ advance notice must be provided to HIME on all changes.

4.2 CONTINUING DEVELOPMENT OBLIGATIONS

4.2.1 Ongoing Training

Any Distributor who sponsors another Distributor into HIME must perform a bona fide assistance and training function to ensure that his or her downline is properly operating his or her HIME business. Distributors must have ongoing contact and communication with the Distributors in their Downline Organizations. Examples of such contact and communication may include, but are not limited to: newsletters, written correspondence, personal meetings, telephone contact, voice mail, electronic mail, and the accompaniment of downline Distributors to HIME meetings, training sessions, and other functions. Upline Distributors are also responsible to motivate and train new Distributors in HIME Product knowledge, effective sales techniques, the HIME Compensation Plan, and compliance with Company Policies and Procedures. Communication with and the training of downline Distributors must not, however, violate Section 3.2 (regarding the development of Distributor produced sales aids and promotional materials). Distributors should monitor the Distributors in their Downline Organizations to guard against downline Distributors making improper, false or misleading Product or business claims or engaging in any illegal, unconscionable or inappropriate conduct or any fraud, coercion, harassment.

4.2.2 Increased Training Responsibilities

As Distributors progress through the various levels of leadership, they will become more experienced in sales techniques, Product knowledge, and understanding of the HIME program. They will be called upon and expected to share this knowledge with lesser experienced Distributors within their organization.

4.2.3 Ongoing Sales Responsibilities

Regardless of their level of achievement, Distributors have an ongoing obligation to continue to personally promote sales through the generation of new customers and through servicing their existing customers.

4.3 NON-DISPARAGEMENT

HIME wants to provide its independent Distributors with the best Products, Compensation Plan, and service in the industry. Accordingly, HIME values constructive criticisms and comments. All such comments should be submitted in writing to the Customer Service Department. While HIME welcomes constructive input, negative comments and remarks made in the field by Distributors about the Company, its Products, or Compensation Plan serve no purpose other than to sour the enthusiasm of other HIME Distributors. For this reason, and to set the proper example for their downline, Distributors must not disparage, demean, or make negative remarks about HIME, other HIME Distributors, HIME’s Products, the Compensation Plan, or HIME’s directors, officers, or employees.

4.4 PROVIDING DOCUMENTATION TO APPLICANTS

Distributors must provide the most current version of the Policies and Procedures and the Compensation Plan to individuals whom they are sponsoring to become Distributors before the applicant signs a Distributor Agreement. Additional copies of Policies and Procedures can be downloaded from HIME’s website.

4.5 Reporting Policy Violations

Distributors observing a Policy violation by another Distributor should report the violation directly to the attention of the HIME Customer Service Department by sending an email to [email protected]. Details of the incidents such as dates, number of occurrences, persons involved, and any supporting documentation should be included in the report.

5 SALES REQUIREMENTS

5.1 PRODUCT SALES

The HIME Compensation Plan is based on the sale of HIME Products to end consumers. Distributors must fulfill personal and Downline Organization retail sales requirements (as well as meet other responsibilities set forth in the Agreement) to be eligible for bonuses, commissions, and advancement to higher levels of achievement. Distributors must satisfy the Personal Sales Volume and Group Sales Volume requirements to fulfill the requirements Distributor with their rank as specified in the HIME Compensation Plan. “Personal Sales Volume” includes purchases made by the Distributor and purchases made by the Distributor’s personal customers. “Group Sales Volume” shall include the total Sales Volume of all Distributors in his or her marketing organization, but shall not include the Distributor’s Personal Sales Volume.

5.3 WILL CALL

Where will call service is available, an Distributor may pick up the order at the will call location. The Company may ship, at the Distributor’s expense, Product that has been marked for will call pick-up if the Product has not been picked up by the Distributor within ninety (90) calendar days of the scheduled autoship date, or the end of the calendar month, whichever is latest. If the Product is shipped to the Distributor from the will call location, the Company may use any payment method on file to collect the shipping fees. Alternatively, the Company may, in its sole discretion, declare the order abandoned and cause the Distributor to forfeit the order. If the order is abandoned, the Distributor releases the Company from any further obligation or liability.

5.4 SALES RECEIPTS

All Distributors must provide their Retail Customers with two copies of an official HIME sales receipt at the time of the sale. These receipts set forth the Customer Satisfaction Guarantee as well as any consumer protection rights afforded by law . Distributors must maintain all retail sales receipts for a period of two years and furnish them to HIME at the Company’s request. Records documenting the purchases of Distributors’ Preferred Customers will be maintained by HIME. Remember that customers must receive two copies of the sales receipt. In addition, Distributors must verbally inform the buyer of his or her cancellation rights.

6 BONUSES AND COMMISSIONS

6.1 BONUS AND COMMISSION QUALIFICATIONS

A Distributor must be active and in compliance with the Agreement to qualify for bonuses and commissions. So long as a Distributor complies with the terms of the Agreement, HIME shall pay commissions to such Distributor in accordance with the Compensation Plan. For the avoidance of doubt, such commissions will accrue only as a result of the sales of Products and not as a result of the introduction or recruitment of Distributors. The minimum amount for which HIME will issue commission is $40 USD. If an Distributor’s bonuses and commissions do not equal or exceed $40 USD , HIME will accrue the commissions and bonuses until they total $40 USD . Commission will be issued once $40 USD has been accrued.

6.2 ADJUSTMENT TO BONUSES AND COMMISSIONS

Distributors receive bonuses and commissions based on the actual sales of Products to end consumers. When a Product is returned to HIME for a refund or is repurchased by the Company, either of the following may occur at the Company’s discretion: (1) the bonuses and commissions attributable to the returned or repurchased Product(s) will be deducted, in the month in which the refund is given, and continuing every pay period thereafter until the commission is recovered, from the Distributors who received bonuses and commissions on the sales of the refunded Products; or (2) the Distributors who earned commissions based on the sale of the returned Products will have the corresponding points deducted from their Group Volume in the next month and all subsequent months until it is completely recovered.

6.3 REPORTS

All information provided by HIME in online or telephonic downline activity reports, including but not limited to personal and group sales volume (or any part thereof), and downline sponsoring activity is believed to be accurate and reliable. Nevertheless, due to various factors including but not limited to the inherent possibility of human and mechanical error; the accuracy, completeness, and timeliness of orders; denial of credit card and electronic check payments; returned Products; credit card and electronic check charge-backs; the information is not guaranteed by HIME or any persons creating or transmitting the information. All personal and group sales volume information is provided “as is” without warranties, express or implied, or representations of any kind whatsoever. In particular but without limitation there shall be no warranties of merchantability, fitness for a particular use, or non-infringement. To the fullest extent permissible under applicable law, HIME and/or other persons creating or transmitting the information will in no event be liable to any Distributor or anyone else for any direct, indirect, consequential, incidental, special, or punitive damages that arise out of the use of or access to personal and group sales volume information (including but not limited to lost profits, bonuses, or commissions, loss of opportunity, and damages that may result from inaccuracy, incompleteness, inconvenience, delay, or loss of the use of the information), even if HIME or other persons creating or transmitting the information shall have been advised of the possibility of such damages. To the fullest extent permitted by law, HIME or other persons creating or transmitting the information shall have no responsibility or liability to the Distributor or anyone else under any tort, contract, negligence, strict liability, products liability or other theory with respect to any subject matter of this agreement or terms and conditions related thereto. Access to and use of HIME’s online and telephone reporting services and reliance upon such information is at the Distributor’s own risk. All such information is provided to Distributors “as is.” If an Distributor is dissatisfied with the accuracy POLICIES AND PROCEDURES HIME | 19 or quality of the information, the sole and exclusive remedy is to discontinue use of and access to HIME’s online and telephone reporting.

7 PRODUCT GUARANTEES, RETURNS AND INVENTORY REPURCHASE

7.1 RETURNS GUARANTEE

HIME offers a 100% 7-day money-back guarantee to all Preferred Customers, Retail Customers, and Distributors on their initial enrollment order. If, for any reason, a Distributor or a customer is dissatisfied with their initial Product order, the Distributor or customer may return the used portion of the Product within 7 days from the date of distribution of the Product. All Distributor, Preferred Customer, and Retail Customer enrollment orders purchased directly from HIME must be returned to HIME at the Distributor’s/customer’s expense. All Products refunded are subject to bonus withholdings and qualification recalculations based on the original purchase date. Withholdings and refunds are based on enrollment order units, not individual units.

7.1.2 General Returns

7.1.2.1 Requirements

All returns that are not initial order purchases (“Returns”) are subject to the follow conditions:

Returns must have been personally purchased by the Distributor from HIME. (Purchases from other Distributors or third parties are not subject to refund.)
Returns must be in Resalable condition (see Definition of “Resalable” in Section 7.2).
Returns in Resalable condition and returned within 7 days of the date of distribution of the Product will receive a 100% refund (less shipping costs).
Product and marketing materials returned after 30 days will not be refunded, except as an inventory repurchase as specified in Section 7.2.

7.1.2.2 Autoship Returns

To cancel an autoship order, Distributors must contact Customer Service at least 3 business days before the autoship order is to go through. All other policies listed in Section 7.1.2 apply to returns for autoship orders.

7.1.3 Retail Purchase from a Distributor’s Inventory

If, for any reason, a Retail Customer is dissatisfied with their initial order of HIME Products, the Retail Customer may return the unused/used portion of the Product to the Distributor from whom it was purchased, within 7 days of the date of distribution of the Product, for a full refund of the purchase price (less shipping costs). All Distributors agree to honor this refund policy for their Retail Customers. After the initial order, Retail Customers may return Product for a full refund within 7 days of the date of distribution of the Product (less shipping) as long as Product is in Resalable condition (see Definition of “Resalable” in Section 7.2). In the event a Distributor issues such a refund to a Retail Customer, the Distributor may return the refunded Products to HIME within 7 days of the date of distribution of the Product for a full Product replacement, provided the Distributor includes a copy of the retail receipt with the empty packaging. All retail orders and returns are subject to confirmation by the Company. The Product must be received by HIME within 7 days from the date on which the Retail Customer returned the merchandise to the Distributor. Distributors are responsible for shipping charges for all replacement Products sent from HIME. Distributors must verbally inform customers of their right to rescind a purchase or an order within three business days, and ensure that the date of the order or purchase is entered on the order form. All Retail Customers must be provided with two copies of an official HIME sales receipt at the time of the sale. The back of the receipt provides the Retail Customer with written notice of his or her rights to cancel the sales agreement

7.2 INVENTORY REPURCHASE UPON CANCELLATION

Upon cancellation of an Agreement, the Distributor may return Starter Kits, Products, and sales aids for a 100% refund . To receive a refund from HIME pursuant to this policy, the following requirements must be met:

The items being returned must have been personally purchased by the Distributor from HIME (purchases from other Distributors or third parties are not subject to refund);
The items must be in Resalable condition (see Definition of “Resalable” below); and
The items must have been purchased from HIME within 3 months prior to the date of cancellation.

If the purchases were made by credit card, the refund will be credited back to the same account. If a Distributor was paid a bonus or commission based on a Product(s) that he or she purchased, and such Product(s) is subsequently returned for a refund, the bonus and/or commission that was paid to the Distributor based on that Product purchase will be deducted from the amount of the refund. Products and Sales aids shall be deemed “Resalable” if each of the following elements is satisfied:

1) they are unopened and unused;

2) packaging and labeling has not been altered or damaged;

3) they are in a condition such that, in accordance with commercially reasonable practice within the trade, the merchandise may be resold at full price; and

4) they are returned to HIME within one year from the date of purchase. Any merchandise that is clearly identified at the time of sale as nonreturnable, discontinued, or as a seasonal item, shall not be Resalable.

7.3 PROCEDURES FOR ALL RETURNS

The following procedures apply to all returns for refund, repurchase, or exchange:

All merchandise must be returned by the Distributor or customer who purchased it directly from HIME.
The Company accepts returns of full cases only. Individual bottles may not be returned for refund, repurchase, or exchange.
c. Proper shipping carton(s) and packing materials are to be used in packaging the Product(s) being returned for replacement, and the best and most economical means of shipping is suggested. All returns must be shipped to HIME shipping pre-paid. HIME does not accept shipping-collect packages. The risk of loss in shipping for returned Product shall be on the Distributor. If returned Product is not received by the Company’s Distribution Center, it is the responsibility of the Distributor to trace the shipment.
If an Distributor is returning merchandise to HIME that was returned to him or her by a Retail Customer, the Product must be received by HIME within ten (10) days from the date on which the Retail Customer returned the merchandise to the Distributor and must be accompanied by the sales receipt the Distributor gave to the customer at the time of the sale. All commissionable and qualifying volume will be deducted from the Distributor account in connection to the return. All volume generating returns may result in Distributors having future commissions withheld.
All commissionable and qualifying volume will be deducted from the Distributor account in connection to the return. All volume-generating returns may result in Distributors having future commissions withheld.
All payments are refunded to original payment to the original payee.

No refund, exchange, or replacement of Product will be made if the conditions of these rules are not met.

8 DISPUTE RESOLUTION AND DISCIPLINARY PROCEEDINGS

8.1 DISCIPLINARY SANCTIONS

Violation of the Agreement, these Policies and Procedures, violation of any common law duty, including but not limited to any applicable duty of loyalty, any illegal, fraudulent, deceptive, or unethical business conduct, or any act or omission by an Distributor that, in the sole discretion of the Company, may damage its reputation or goodwill (such damaging act or omission need not be related to the Distributor’s HIME business), may result, at HIME’s discretion, in one or more of the following corrective measures:

Issuance of a written warning or admonition;
Requiring the offending Distributor to take immediate corrective measures;
Imposition of a fine, which may be withheld from bonus and commission checks;
Loss of rights to one or more bonus and commission checks;
HIME may withhold from an offending Distributor all or part of the offending Distributor’s bonuses and commissions during the period that HIME is investigating any conduct that allegedly violates the Agreement. If an offending Distributor’s business is canceled for disciplinary reasons, the offending Distributor will not be entitled to recover any commissions withheld during the investigation period;
Suspension of the offending Distributor’s Agreement for one or more pay periods;
Involuntary termination of the offender’s Distributor’s Agreement;
Suspension and/or termination of the offending Distributor’s HIME website or website access;
Any other measure expressly allowed within any provision of the Agreement or which HIME deems practicable to implement and appropriate to equitably resolve injuries caused partially or exclusively by the Distributor’s policy violation or contractual breach;
In situations deemed appropriate by HIME, the Company may institute legal proceedings for monetary and/or equitable relief. .

8.2 GRIEVANCES AND COMPLAINTS

When a Distributor has a grievance or complaint with another Distributor regarding any practice or conduct in relationship to their respective HIME businesses, the complaining Distributor should first report the problem to his or her Sponsor who should review the matter and try to resolve it with the other party’s upline sponsor. If the matter involves interpretation or violation of Company policy, it must be reported in writing to the Compliance Department at the Company. The Compliance Department will review the facts and attempt to resolve for final review and determination.

8.3 COMPLIANCE DEPARTMENT

The purpose of Compliance Department is to:

(1) review appeals of disciplinary sanctions; and

(2) review matters between HIME Distributors.

After the response or settlement instituted by Compliance Department has been denied or otherwise remains unresolved, the Compliance Department reviews evidence, deliberates, and responds to current outstanding issues on a collective basis. A Distributor may submit a written request for a telephonic or in-person hearing within seven business days from the date of:

(1) the written notice by HIME of disciplinary action; or

(2) the written decision of the Compliance Department regarding disputes between Distributors. All communication with HIME and the Distributor seeking resolution of a dispute must be in writing. The decision of the Compliance Department will be final and subject to no further review. During the pendency of the claim before the Compliance Department, the Distributor waives his or her right to pursue arbitration or any other remedy. Following issuance of a sanction, the disciplined Distributor may appeal the sanction to the Compliance Department. Distributor’s appeal must be in writing and received by the Company within 15 days from the date of HIME’s cancellation notice. If the appeal is not received by HIME within the 15-day period, the sanction will be final. The Distributor must submit all supporting documentation with his or her appeal correspondence. If the Distributor files a timely appeal of cancellation, the Compliance Department will review and reconsider the cancellation, consider any other appropriate action, and notify the Distributor in writing of its decision.

8.4 MEDIATION

Prior to instituting an arbitration, the parties shall meet in good faith and attempt to resolve any dispute arising from or relating to the Agreement through non-binding mediation under the guidelines of the US Mediation Act. One individual, who is mutually acceptable to the parties, shall be appointed as mediator. The mediator’s fees and costs, as well as the costs of holding and conducting the mediation, shall be divided equally between the parties. Each party shall pay its portion of the anticipated shared fees and costs at least 10 days in advance of the mediation. Each party shall pay its own attorney’s fees, costs, and individual expenses Distributor with conducting and attending the mediation. Mediation shall be held in US and shall last no more than two business days.

8.5 ARBITRATION

If mediation is unsuccessful, any controversy or claim arising out of or relating to the Agreement, or the breach thereof, shall be settled by arbitration administered under guidelines of US law, and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Distributors waive all rights to trial by jury or to any court. All arbitration proceedings shall be held in US. There shall be one arbitrator, an attorney at law, who shall have expertise in business law transactions with a strong preference being an attorney knowledgeable in the direct selling industry. Each party to the arbitration shall be responsible for its own costs and expenses of arbitration, including legal and filing fees. The decision of the arbitrator shall be final and binding on the parties and may, if necessary, be reduced to a judgment in any court of competent jurisdiction. This agreement to arbitration shall survive any termination or expiration of the Agreement. Notwithstanding the foregoing, nothing in these Policies and Procedures shall prevent HIME from applying to and obtaining from any court having jurisdiction a writ of attachment, a temporary injunction, preliminary injunction, permanent injunction, or other relief available to safeguard and protect HIME’s interest prior to, during, or following the filing of any arbitration or other proceeding or pending the rendition of a decision or award in connection with any arbitration or other proceeding.

8.6 GOVERNING LAW, JURISDICTION AND VENUE

Jurisdiction and venue of any matter not subject to arbitration shall reside exclusively in US.

9 PAYMENT AND SHIPPING

9.1 RETURNED CHECKS

All checks returned by a Distributor’s bank for insufficient funds will be re-submitted for payment. A $10 USD returned check fee will be charged to the account of the Distributor. After receiving a returned check from a customer or a Distributor, all future orders must be paid by Credit Card, money order or cashier’s check. Any outstanding balance owed to HIME by a Distributor for NSF checks and returned check fees will be withheld from subsequent bonus and commission checks.

9.2 RESTRICTIONS ON THIRD PARTY USE OF CREDIT CARDS AND CHECKING ACCOUNT ACCESS

Distributors shall not permit other Distributors or Preferred Customers to use his or her credit card, or permit debits to their checking accounts, to enroll or to make purchases from the Company.

9.3 SALES TAXES

In designing the HIME opportunity, one of our guiding philosophies has been to free Distributors from as many administrative, operational, and logistical tasks as possible. In doing so, Distributors are free to concentrate on those activities that directly affect their incomes, namely Product sales and enrollment activities. To these ends, HIME relieves Distributors of the burdens of collecting and remitting sales taxes, filing sales tax reports, and keeping records relative to sales taxes. By virtue of its business operations, HIME is required to charge sales taxes on all purchases made by Distributors and Preferred Customers and remit the taxes charged to the appropriate authorities. Accordingly, HIME will collect and remit sales taxes on behalf of Distributors, based on the suggested retail price of the Products, according to applicable tax rates in the state or province to which the shipment is destined. If a Distributor has submitted, and HIME has accepted, current documentation to exempt from sales taxes due to business or other status, sales taxes will not be added to the invoice and the responsibility of collecting and remitting sales taxes to the appropriate authorities shall be on the Distributor. Exemption from the payment of sales tax is applicable only to orders which are shipped to a state for which the proper tax exemption papers have been filed and accepted. Applicable sales taxes will be charged on orders that are drop-shipped to another state. Any sales tax exemption accepted by HIME is not retroactive.

10 RECLASSIFICATION & CANCELLATION

10.1 EFFECT OF CANCELLATION

So long as a Distributor remains active and complies with the terms of the Agreement and these, HIME shall pay commissions to such Distributor in accordance with the Compensation Plan. A Distributor’s bonuses and commissions constitute the entire consideration for the Distributor’s efforts in generating sales and all activities related to generating sales (including building a downline organization). Following a Distributor’s non-renewal of his or her Agreement, or voluntary or involuntary cancellation of his or her Distributor Agreement (all of these methods are collectively referred to as “cancellation”), the former Distributor shall have no right, title, claim or interest to the marketing organization which he or she operated, or any commission or bonus from the sales generated by the organization. A Distributor whose business is canceled will lose all rights as a Distributor. This includes the right to sell HIME Products and services and the right to receive future commissions, bonuses, or other income resulting from the sales and other activities of the Distributor’s former downline sales organization. In the event of cancellation, Distributors agree to waive all rights they may have, including but not limited to property rights, to their former downline organization and to any bonuses, commissions or other remuneration derived from the sales and other activities of his or her former downline organization. Following a Distributor’s cancellation of his or her Agreement, the former Distributor shall not hold himself or herself out as an HIME Distributor and shall not have the right to sell HIME Products or services. A Distributor whose Agreement is canceled shall receive commissions and bonuses only for the last full pay period he or she was active prior to cancellation (less any amounts withheld during an investigation preceding an involuntary cancellation). For example, if A sponsors B, and B sponsors C1, C2, and C3, if B terminates her business, C1, C2, and C3 will not “roll up” to A.

10.2 RE-REGISTRATION FOLLOWING CANCELLATION

Former Distributors may register as a Preferred Customer at any time following cancellation. By doing so, the Distributor will be entitled to continue purchasing Products directly from the Company at the Preferred Customer price. There is no charge for a former Distributor to re-register as a Distributor if he or she does so under their former sponsor within 6 months of the date of cancellation provided that the renewal fee is paid, but the Distributor will lose all of the former downline.

10.3 INVOLUNTARY CANCELLATION

A Distributor’s violation of any of the terms of the Agreement, including any amendments that may be made by HIME in its sole discretion, may result in any of the sanctions listed in Section 8.1, including the involuntary cancellation of his or her Distributor Agreement. Cancellation shall be effective on the date on which written notice is mailed, faxed, or delivered to an express courier, to the Distributor’s last known address (or fax number), or to his/her attorney, or when the Distributor receives actual notice of cancellation, whichever occurs first. HIME reserves the right to terminate all (i.e. and Distributor) Agreements upon 60 days written notice in the event that it elects to:

(1) cease business operations;

(2) dissolve as a corporate entity; or

(3) terminate distribution of its Products via direct selling.

10.4 VOLUNTARY CANCELLATION

A participant in this network marketing plan (i.e. and Distributor) has a right to cancel at any time, regardless of reason. Cancellation must be submitted in writing to the Company at its principal business address. The written notice must include the Distributor’s signature, printed name, address, and Distributor I.D. Number. If an Distributor is also on the Company’s Autoship program (a Preferred Customer), the Distributor’s Preferred Customer Agreement shall continue in force unless the Distributor also specifically requests that his or her Preferred Customer Agreement also be canceled.

10.5 NON-RENEWAL

A Distributor may also voluntarily cancel his or her Agreement by failing to renew the Agreement on its anniversary date. The Company may also elect not to renew an Agreement upon its anniversary date.

10.6 CREDIT CARD CHARGEBACKS

If a Distributor contacts his or her credit card company and attempts to charge back any Product purchase from the Company, such action shall be deemed a voluntary cancellation of the Agreement by the Distributor. If the Distributor also has an Autoship Agreement with HIME, the charge back shall also be deemed the voluntary cancellation of the Distributor’s Autoship Agreement. Similarly, if a Preferred Customer contacts his or her credit card company and attempts to charge back a purchase made by credit card, such action will be deemed the voluntary cancellation of the Preferred Customer Agreement.

11 DEFINITIONS

Active Customer — A Customer who purchases HIME Products and whose account has been paid for the ensuing year.

Active Distributor — An Distributor who has generated at least 100 PV in Product sales during 4 rolling month.

Active Rank — The term “active rank” refers to the current rank of a Distributor, as determined by the HIME Compensation Plan, for any month. To be considered “active” relative to a particular rank, a Distributor must meet the criteria set forth in the HIME Marketing and Compensation Plan for his or her respective rank. (See the definition of “Rank” below.)

Agreement — The contract between the Company and each Distributor includes the Distributor Application and Agreement, the HIME Policies and Procedures, the HIME Compensation Plan, and the Business Entity Form (where appropriate), all in their current form and as amended by HIME in its sole discretion. These documents are collectively referred to as the “Agreement.”

Autoship Policy — As a service and convenience to Distributors, HIME offers an autoship program in which Distributors may select the option of having a reoccurring order automatically processed each month. The Distributor can call Customer Service or go through their back office to enter their credit card information, choose a date with which the autoship will be processed, and select what to include in the order. This autoship service can be turned off at any time again through Customer Service or the back office.

Beneficial Interest — A person is deemed to have a Beneficial Interest in an HIME business if he/she/it has:

(1) any direct or indirect ownership in the HIME business as an individual, partner, shareholder, member, manager, beneficiary, trustee, or principal of the business;

(2) has any actual or de facto control over the HIME business;

(3) receives any income directly or indirectly from the HIME business (other than the receipt of income pursuant to the Compensation Plan by an upline Distributor);

(4) receives familial support from the HIME business;

(5) receives spousal support derived from the HIME business;

(6) is a member of the Distributor’s immediate household;

(7) is a spouse or co-habitant; or

(8) has any other similar interest in the HIME business.

Cancel — The termination of a Distributor’s agreement. Cancellation may be either voluntary or involuntary. Downline Activity (Genealogy) Report — A weekly report generated by HIME that provides critical data relating to the identities of Distributors, sales information, and enrollment activity of each Distributor’s Marketing Organization. This report contains confidential and trade secret information which is proprietary to HIME.

Downline Leg — Each one of the individuals enrolled immediately underneath the Distributor and their respective marketing organization represents one “leg” in a marketing organization.

Group Sales Volume — The commissionable value of HIME Products sold by a Distributor’s Marketing Organization. Group Sales Volume does not include the Personal Sales Volume of the subject Distributor. (Starter Kits and sales aids have no Sales Volume.)

Immediate Household — Heads of household and dependent family members residing in the same house.

Level — The layers of downline Preferred Customers and Distributors in a particular Distributor’s Marketing Organization. This term refers to the relationship of an Distributor relative to a particular upline Distributor, determined by the number of Distributors between them who are related by sponsorship. For example, if A sponsors B, who sponsors C, who sponsors D, who sponsors E, then E is on A’s fourth level.

Marketing Organization — The Preferred Customers and Distributors sponsored below a particular Distributor.

Official HIME Material — Literature, audio or video tapes, and other materials developed, printed, published and distributed by HIME to Distributors.

Personal Production — Moving HIME Products to an end consumer for personal use.

Personal Volume (PV) — The commissionable value of Products sold in a calendar month:

(1) by the Company to a Distributor; and

(2) by the Company to the Distributor’s customers and personally enrolled Preferred Customers.

Product – Any good or service offered by the Company and sold through independent Distributors.

Rank — The “title” that a Distributor has achieved the related qualification with 2 rolling weeks to the HIME Compensation Plan.

Recruit — For purposes of HIME’s Conflict of Interest Policy (Section 3.9), the term “Recruit” means the actual or attempted sponsorship, solicitation, enrollment, encouragement, or effort to influence in any other way, either directly, indirectly, or through a third party, another HIME Distributor or Preferred Customer to enroll or participate in another direct-selling , network marketing, or direct sales opportunity.

Resalable — Products and Sales aids shall be deemed “Resalable” if each of the following elements is satisfied:

1) they are unopened and unused;

2) packaging and labeling has not been altered or damaged;

3) they are in a condition such that, in accordance with commercially reasonable practice within the trade, the merchandise may be resold at full price;

4) it is returned to HIME within one year from the date of purchase;

5) the Product contains current HIME labeling. Any merchandise that is clearly identified at the time of sale as nonreturnable, discontinued, or as a seasonal item, shall not be Resalable.

Retail Customer — An individual or entity that purchases HIME Products, but who is not an Distributor, Preferred Customer, or an immediate household family member of an Distributor.

Retail Establishment – Any enterprise with a physical location that is engaged in the sale of goods or services and that is not a Service-related Establishment. Examples include, but are not limited to, mass market and specialty stores. For purposes of this definition, a Retail Establishment does not include the Internet when a Distributor complies with the relevant sections of these Policies and Procedures regarding authorized Internet sales and advertising.

Retail Sales — Sales to a Retail Customer. If a sale is made to a customer who subsequently submits an HIME Agreement within 30 days from the date of the sale, or if an immediate household family member of the Retail Customer submits an HIME Agreement within 30 days of the sale, such sale shall not constitute a Retail Sale. A Distributor’s personal purchases from HIME do not constitute Retail Sales.

Service-related Establishment — An establishment that requires a membership and/or an appointment, and the services performed are health and wellness related. Examples of approved Service-related Establishments include, but are not limited to, chiropractor offices, salons, acupuncture clinics, and gyms.

Sponsor — An Distributor who enrolls a Preferred Customer or another Distributor into the Company, and is listed as the Sponsor on the Distributor Application and Agreement. The act of enrolling others and training them to become Distributors is called “sponsoring.”

Starter Kit — A selection of HIME training materials and business support literature that each new Independent Distributor is required to purchase. The Starter Kit is sold to Distributors at the Company’s cost.

Upline — This term refers to the Distributor or Distributors above a particular Distributor in a sponsorship line up to the Company. Conversely stated, it is the line of sponsors that links any particular Distributor to the Company.