Liberty Business Suite

 

POLICIESAND

PROCEDURES  

&

TERMS AND CONDITIONS

 

Liberty Freedom Network, Inc.

 

 

Dated: July 04, 2010

 

 

 

 

 

 

 

 


 

 

The COMPANY -- Code of Ethics

 

As an Independent Representative (hereinafter collectively a “REPRESENTATIVE”) of Liberty Freedom Network (hereinafter the “COMPANY”), I represent, warrant, promise and agree that:

 

ü  I will be courteous, respectful, honest and fair in all my dealings while acting as a REPRESENTATIVE and I will perform my business activities in a manner that will enhance my reputation and the positive reputation of the COMPANY.  I recognize that the founders of the COMPANY have strong personal convictions regarding the ethical conduct of all REPRESENTATIVES.

ü  I will not engage in any deceptive or illegal practice.

ü  I will make no claim for products, services or business positions of the COMPANY except as contained in official literature of the COMPANY.

ü  I will not misrepresent, or make any representations or warranties concerning, the income potential of the REPRESENTATIVE Compensation Plans or Commission Plans. It is impossible to predict REPRESENTATIVE incomes.  The success of a REPRESENTATIVE depends on many variables, such as amount of time and effort committed to his/her business and his/her organizational abilities and successful sales of the COMPANY’S product.

ü  I understand and agree that in order to maintain the long-term viability of everyone’s business, the COMPANY maintains a ZERO-TOLERANCE POLICY to any and all violations of this AGREEMENT.  

 

SECTION 1 – INTRODUCTION

1.1 - Policies and Compensation Plan Incorporated into AGREEMENT

These Policies and Procedures, in their present form and as amended at the sole discretion of the COMPANY, are incorporated into, and form an integral part of the COMPANY’S AGREEMENT with its REPRESENTATIVES.  Throughout these Policies, when the term “AGREEMENT” is used, it collectively refers to the COMPANY’S REPRESENTATIVE On-Line Application and AGREEMENT, these Policies and Procedures and incorporated Terms and Conditions, the COMPANY’S general Compensation Plan, and the COMPANY’S Business Entity Registration Form (if applicable).  These documents are incorporated by reference into the COMPANY’S REPRESENTATIVE AGREEMENT (all in their current form and as amended by the COMPANY from time-to-time at its sole discretion).  It is the responsibility of each REPRESENTATIVE to read, understand, adhere to, and ensure that he or she is aware of and operating under the most current version of the AGREEMENT.  When enrolling a new REPRESENTATIVE it is the responsibility of the referring REPRESENTATIVE to ensure the applicant is provided with, or has online access to, the most current version of the AGREEMENT and the COMPANY’S Marketing, Compensation Plan and Income Disclosure Statement prior to his or her execution of the REPRESENTATIVE AGREEMENT.

1.2 - Purpose of Policies

The COMPANY is involved in direct sales, marketing its services and products through its REPRESENTATIVES.  It is important to understand your success and the success of your fellow REPRESENTATIVES depend on the integrity of the men and women who market our products and services as well as those of our preferred merchants.  To clearly define the relationship existing between REPRESENTATIVES and the COMPANY, and to explicitly set a standard for acceptable business conduct, the COMPANY has established the AGREEMENT.

The COMPANY’S REPRESENTATIVES are required to comply with all the Terms and Conditions set forth in the AGREEMENT, as well as all federal, state, and local laws governing their business and their conduct.  Because you may be unfamiliar with many of these standards of practice, it is very important to read and abide by the AGREEMENT.  Please review the information in this AGREEMENT carefully.  It explains and governs the relationship between you, as an independent contractor, and the COMPANY.  If you have any questions regarding any policy or rule, do not hesitate to seek an answer from the COMPANY or the person who referred you to the COMPANY.

1.3 - Changes to the AGREEMENT

Because federal, state, and local laws, as well as the business environment, periodically change, the COMPANY reserves the right to amend the AGREEMENT, the compensation plan and its prices at its sole and absolute discretion.  By signing the Application and AGREEMENT, the REPRESENTATIVE agrees to abide by all amendments that the COMPANY elects to make.  Amendments shall be effective upon notice to all REPRESENTATIVES that the AGREEMENT has been modified.  The COMPANY shall provide or make available to all REPRESENTATIVES a complete copy of the amended provisions by one or more of the following methods: (1) posting on the COMPANY’S official web site; (2) electronic mail (e-mail); (3) inclusion in COMPANY periodicals; or, (4) inclusion in U.S. Postal Service mailings. The continuation of a REPRESENTATIVE’S independent business relationship or a REPRESENTATIVE’S acceptance of bonuses, commissions or cash back constitutes acceptance of any and all amendments.

1.4 - Delays

The COMPANY 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, telecommunications failure, weather or government decrees or orders.

1.5 - 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 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.

1.6 - Waiver

The COMPANY never gives up its rights to insist on compliance with the AGREEMENT and with the applicable laws governing the conduct of a business.  No failure of the COMPANY to exercise any right or power under the AGREEMENT or to insist upon strict compliance by a REPRESENTATIVE 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 the COMPANY’S right to demand exact compliance with the AGREEMENT.  Waiver by the COMPANY can be effectuated only in writing by an authorized officer of the respective COMPANY.  The COMPANY’S waiver of any particular breach by a REPRESENTATIVE shall not affect or impair the COMPANY’S rights with respect to any subsequent breach, nor shall it affect in any way the rights or obligations of any other REPRESENTATIVE.  No delay or omission by the COMPANY to exercise any right arising from a breach shall affect or impair the COMPANY’S rights as to that or any subsequent breach.

The existence of any claim or cause of action of a REPRESENTATIVE against the COMPANY shall not constitute a defense to the COMPANY’S enforcement of any term or provision of the AGREEMENT.

 

SECTION 2 – BECOMING A REPRESENTATIVE   

2.1 - Requirements to Become a REPRESENTATIVE

To become a REPRESENTATIVE for the COMPANY, each applicant must:

a)     If an individual, be of the age of majority in his or her state of residence except as outlined clearly in Section 4.2 below;

b)    Reside in the United States, a U.S. Territory, or any country which the COMPANY has officially announced is open for business;

c)     Have and produce a valid Social Security or Federal Tax ID Number;

d)    Agree to abide by the AGREEMENT;

e)     Submit a properly completed (online) Application and AGREEMENT to the COMPANY, including any required documents in support of business entity.

2.2 - No Product Purchase Required

A person desiring to become a REPRESENTATIVE is not required to purchase any products, services or sales aids.    

2.3 – REPRESENTATIVE BENEFITS

  Only those REPRESENTATIVES who are otherwise qualified under the COMPANY’s Commission Rules also have the right to: 

a)     Sell the COMPANY’S products and services;

b)    Participate in the COMPANY’S Compensation Plan (receive bonuses and commissions, if eligible);

c)     Refer other individuals as REPRESENTATIVES, thereby building a Marketing Organization;

d)    Receive periodic literature from the COMPANY;

e)     Participate in the COMPANY-sponsored optional support, service, training, motivational and recognition functions, upon payment of appropriate charges, if applicable; and

f)     Participate in promotional and incentive contests and programs sponsored by the COMPANY for its REPRESENTATIVES.

2.4 - General Responsibilities of a REPRESENTATIVE

In presenting any REPRESENTATIVE position to prospects, REPRESENTATIVE agrees that such presentations shall be made strictly according to the following format:

a)     In each presentation of the COMPANY’S product and opportunity, REPRESENTATIVES shall inform the prospect that no product purchase is required or is a means to become an Liberty Freedom Network Independent Representative.

b)     When a prospect is being presented with any REPRESENTATIVE business position, REPRESENTATIVE shall present any perks, Merchant information and benefits by following these presentation guidelines: REPRESENTATIVES are responsible for teaching, coaching, training and supporting all new REPRESENTATIVES who he or she refers into the COMPANY’S program and in his or her commissionable downline.  REPRESENTATIVES agree to maintain monthly communication and support to those REPRESENTATIVES in their commissionable business by way of any of the following, or combination thereof; personal contact, telephone or internet communication, written communication or attendance at REPRESENTATIVE’S meetings.

c)     REPRESENTATIVE shall not offer to buy or sell any sales lead, product, material, or service to or from any current REPRESENTATIVE.  

d)     A REPRESENTATIVE shall not initiate, recommend, offer, sell or participate in any prize offering, guarantee, drawing, raffle, lottery, sales leads or lead generation program, advertising pool or co-op in furtherance of REPRESENTATIVE’S own or another  REPRESENTATIVE’s business.

2.5 - Term and Renewal of Your REPRESENTATIVE Business

The term of the REPRESENTATIVE AGREEMENT is one year from the effective date of the agreement being executed by the REPRESENTATIVE.  Thereafter, the REPRESENTATIVE AGREEMENT must be renewed on an annual basis.  The annual renewal fee is $50.00. Active IRs will automatically have the renewal fee debited from their compensation checks.

2.6 - Talent Release

Each REPRESENTATIVE hereby consents to, allows and grants the COMPANY and its parents, subsidiaries and affiliated entities a perpetual, worldwide, royalty-free and exclusive license to use, edit, modify and otherwise exploit (1) the name, photograph, testimonials, statements, likeness, biographical information, title, positions, voice, voices and biography and (2) any film footage, video tapes, audio tapes, recordings and interviews when created in connection with any COMPANY events, promotion and/or conventions, to advertise, promote and publicize the COMPANY’S business, products, events and/or services, in any form, format or media, whether now known or hereafter devised. 

SECTION 3 - OPERATING YOUR BUSINESS

3.1 - Trademarks and Copyrights

The COMPANY will not permit the use of its trade names, trademarks, designs, or symbol by any person, including the COMPANY’S REPRESENTATIVE, without its prior, written permission.  REPRESENTATIVE agrees that the COMPANY and its affiliated merchant companies’ trademarks, service marks, trade names, patents and copyrighted materials are owned exclusively by the COMPANY and/or its affiliated merchant companies, and that any use of such intellectual property by REPRESENTATIVE must be in compliance with the AGREEMENT and/or with any COMPANY approved training or material.  REPRESENTATIVE will not promote his or her REPRESENTATIVE business or use the COMPANY’S, any of its affiliated companies’ or any third party’s names, trade names, logos, sales materials, trademarks, service marks, URL links or other intellectual property, except in material as provided by COMPANY.  The term “sales, advertising and training materials” includes but is not limited to; written, audio, CD, DVD, and flash materials and presentations as well as shirts, hats or other articles of clothing or accessories.  Without limiting the generality of the foregoing, REPRESENTATIVE understands that REPRESENTATIVE is prohibited from (i) using the COMPANY’S, its affiliated companies’ and third parties’ trademarks and trade names in domain names, (ii) creating his or her own sales and training materials and/or presentations that use the names, trademarks, logos or other intellectual property of the COMPANY, its affiliated companies or third parties and (iii) creating any other materials that incorporate the COMPANY'S names, logos, trademarks or copyrighted works.  REPRESENTATIVE understands that unauthorized use or duplication of the COMPANY’S, its affiliated companies’ and third parties’ names, marks, sales and training materials  or copyrighted materials is a violation of federal and/or state law, the AGREEMENT, and may result in termination of the AGREEMENT.   Each of the COMPANY’S and its affiliated companies’ names, trademarks and service marks (“Proprietary Marks”) and copyrighted materials are owned by the respective COMPANY and/or their affiliated companies.  The use of the Proprietary Marks and copyrighted materials must be in strict compliance with the AGREEMENT.  Each REPRESENTATIVE acknowledges that any right to use the COMPANY’S Proprietary Marks and copyrighted materials is non-exclusive, and the COMPANY has the right and sole discretion to grant others the right to use such Proprietary Marks and copyrighted materials.  Each REPRESENTATIVE expressly recognizes that, as between such person and the COMPANY, any and all goodwill associated with the Proprietary Marks and copyrighted materials (including goodwill arising from each REPRESENTATIVE’S use) inures directly and exclusively to the benefit of the COMPANY and is the property of the COMPANY, and that, on expiration or termination of these Policies and Procedures, no monetary amount shall be attributable to any goodwill associated with REPRESENTATIVE’S use of the Proprietary Marks or copyrighted materials.  This prohibition also extends to any third party (e.g. merchants’) trademarks. 

COMPANY does not allow REPRESENTATIVE to sell any item of clothing, jewelry, marketing, advertising or training material, with or without COMPANY logo at any COMPANY (or affiliated merchant companies) sponsored event, including any of the COMPANY’S meetings or other training events.

 

3.2 - Adherence to the COMPANY’S Compensation Plan

REPRESENTATIVE must adhere to the terms of the COMPANY’S Compensation Plan as set forth in the COMPANY literature.  REPRESENTATIVE shall not offer the COMPANY’S opportunity through, or in combination with, any other system, program, or method of marketing other than that specifically set forth in official COMPANY literature.  REPRESENTATIVE shall not require or encourage other current or prospective Customers or REPRESENTATIVES to participate in the COMPANY in any manner that varies from the program as set forth in official COMPANY literature.  REPRESENTATIVE shall not require or encourage other current or prospective Customers or REPRESENTATIVES to execute any agreement or contract other than the official COMPANY’S AGREEMENT in order to become a REPRESENTATIVE.  Similarly, REPRESENTATIVE shall not require or encourage other current or prospective Customers or REPRESENTATIVES to make any purchase from, or payment to, any individual or other entity to participate in the COMPANY Compensation Plan other than those purchases or payments identified as recommended or required in the COMPANY’S official literature.

 3.3 - Advertising

General

 All REPRESENTATIVES shall safeguard and promote the good reputation of the COMPANY and its products and services.  The marketing and promotion of the COMPANY, the COMPANY’S opportunity, the Compensation Plan, and the COMPANY’S products and services shall be consistent with the public interest, and must avoid all discourteous, deceptive, misleading, unethical or immoral conduct or practices.

To promote both the products and services, and the opportunity the COMPANY offers, REPRESENTATIVE must only use the promotional materials and sales aids produced by the COMPANY.  The rationale behind this requirement is simple:  The COMPANY has carefully designed its services, products, product labels, Compensation Plan, and promotional materials to ensure each aspect of the COMPANY is fair, truthful, substantiated, and complies with the vast and complex legal requirements of federal and state laws.  If the COMPANY’S REPRESENTATIVES were allowed to develop their own sales aids and promotional materials, notwithstanding their integrity and good intentions, there is likelihood they would unintentionally violate any number of statutes or regulations affecting the COMPANY’S business.  Although these violations may be relatively few in number, they would nonetheless jeopardize the COMPANY’S opportunity for all REPRESENTATIVES. 

Accordingly, REPRESENTATIVES must not produce their own literature, advertisements, sales aids, promotional materials, or Internet web pages.  REPRESENTATIVES may not reference COMPANY executives, REPRESENTATIVES or employees by name in reference literature as a “source” for any information not contained in COMPANY’S approved sales literature.

      The COMPANY does not permit REPRESENTATIVES to create, market or sell sales aids, business cards, Internet websites or similar materials to other REPRESENTATIVES of the COMPANY.  The only approved COMPANY business cards are available for purchase through approved Liberty Freedom Network websites.

 

3.4 - INTERNET Web Sites and Email Communications

If a REPRESENTATIVE desires to utilize an Internet web page to promote his or her business, he or she may do so through the COMPANY’S replicated website, Liberty Freedom Network.com/yourTID or other company approved URLs. This program permits a REPRESENTATIVE to advertise on the Internet on a website that can be personalized with the REPRESENTATIVE’S photo, message and contact information.  These websites provide the REPRESENTATIVE a professional and COMPANY-approved presence on the Internet. No REPRESENTATIVE may independently design or have designed a website using the names, logos, or product descriptions of the COMPANY or otherwise promote (directly or indirectly) the COMPANY’S products or the COMPANY’S opportunity.  A REPRESENTATIVE may not use "blind" or “Help Wanted” ads (indicating a “job” or an “employment position”) whether or not they make product or income claims which are ultimately associated with the COMPANY’S products, the COMPANY’S opportunity, or the COMPANY’S Compensation Plan.  The use of any other Internet website or web page in a manner that is inconsistent with the Policies and Procedures is a breach of the AGREEMENT and may result in any of the disciplinary sanctions set forth in Section 9.1.

 

3.5 - Email Communications - Unsolicited Email - Texting

The COMPANY does not permit REPRESENTATIVES to send unsolicited commercial emails, Instant Messages or other forms of Texting unless such emails strictly comply with applicable laws and regulations including, without limitation, the Federal CAN SPAM Act.  Any email sent by a REPRESENTATIVE that promotes the COMPANY, the COMPANY’S opportunity, or the COMPANY’S products and services must comply with the following:

a)   There must be a functioning return email address to the sender.

b)   There must be a notice in the email advising 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).

c)   The email must include the REPRESENTATIVE’S physical mailing address, (i.e. not a P.O. Box) and may not represent that the email is originating from the COMPANY or that the email is signed by any employee or officer of the COMPANY.

d)   The email must clearly and conspicuously disclose that the message is a commercial advertisement or solicitation.

e)   The use of deceptive subject lines and/or false header information is prohibited.

f)    REPRESENTATIVE shall not make offers or solicitations in the guise of research, surveys or informal communication, when the real intent is to sell products or services or refer other REPRESENTATIVES or enroll other REPRESENTATIVES.   

g)   REPRESENTATIVE shall provide individual consumers the option to terminate any further communication between the REPRESENTATIVE and the consumer and if any consumer requests a REPRESENTATIVE cease communication, the REPRESENTATIVE shall immediately stop communicating upon such request.

h)  REPRESENTATIVE must abide by all laws and regulations regarding electronic communications.

i).   REPRESENTATIVE may not distribute content by use of distribution lists or to any person who has not given specific permission to be included in such a process; spamming or distribution of chain letters or junk mail is not permitted.

j).   REPRESENTATIVE may not distribute content that (i) is unlawful, harassing, libelous, slanderous, abusive, threatening, harmful, vulgar, obscene or otherwise objectionable, (ii) could give rise to civil liability, (iii) violates any applicable local, state, federal or international law or regulation or (iv) describes the COMPANY or and of its products and services in an inaccurate manner. 

k)   REPRESENTATIVE may not, directly or indirectly, buy email lists, send unsolicited e-mails to persons with whom he or she or they have no prior or existing personal or business relationship.

The COMPANY may periodically send commercial emails to retail Customers on behalf of the REPRESENTATIVE.  By entering into the REPRESENTATIVE AGREEMENT, REPRESENTATIVE agrees that the COMPANY may send such emails and the REPRESENTATIVE’S physical and email addresses will be included in such emails as outlined above.  REPRESENTATIVE shall honor opt-out requests generated as a result of such emails sent by the COMPANY.

3.6 - Blogs, Chat Rooms, Social Networks, Online Auctions, and other Online Forums

REPRESENTATIVE’S are expressly prohibited from using any other online forum to market, sell, advertise, promote, or discuss the COMPANY’S products or services or the COMPANY’S opportunity in any manner that is inconsistent with these Policies and Procedures.  REPRESENTATIVE’S are prohibited from using the COMPANY’S, merchant’s or third party’s  trade names, trademarks, service names, service marks, product names, the COMPANY’S name, or any derivative thereof, including alpha-numeric substitutions in group names, titles or content for any blog, chat room, social network, online auction or other online forum.

3.7 - Domain Names and Email Addresses

REPRESENTATIVE may not use or attempt to register any of the COMPANY’S, merchant’s or third party’s trade names, trademarks, service names, service marks, product names, the COMPANY’S name, or any derivative thereof, including alpha-numeric substitutions, for any Internet domain name.  Nor may REPRESENTATIVE incorporate or attempt to incorporate any of the COMPANY’S or third party’s trade names, trademarks, service names, service marks, product names, the COMPANY’S name, or any derivative thereof, into any electronic mail address.

3.8 - Recordings

REPRESENTATIVE may not copy, produce or reproduce for sale or distribution or create derivative works of products sold by the COMPANY or any of the COMPANY’S produced literature, audio or video material, presentations, events or speeches, including conference calls.  Video and/or audio taping meetings and conferences of the COMPANY is strictly prohibited.  

3.9 - Media and Media Inquiries

REPRESENTATIVE must not attempt to respond to media inquiries regarding the COMPANY, its products or services, or their independent business.  All inquiries by any type of media must be immediately referred to the COMPANY’S Media Department, without comment by the REPRESENTATIVE.  This policy is designed to ensure accurate and consistent information is provided to the public as well as a proper public image.  REPRESENTATIVE must not utilize radio or television media for the advertising, distribution or promotion of the COMPANY’S products or opportunity without the express written consent of the COMPANY. In the event the COMPANY does grant permission for the use of such media, the COMPANY must have final authority on every stage of the production process with full rights to all recordings.

3.10 - Unsolicited Faxes

      Except as provided in this section, REPRESENTATIVE may not use or transmit unsolicited faxes or use an automatic telephone dialing system relative to the operation of their independent business enterprise with the COMPANY.  The term “automatic telephone dialing system” means equipment which has the capacity to: (i) store or produce telephone numbers to be called, using a random or sequential number generator; and (ii) to dial such numbers.  The term "unsolicited faxes" means the transmission via telephone facsimile of any material or information advertising or promoting the COMPANY, its products, the Compensation Plan or any other aspect of the COMPANY which is transmitted to any person, except that these terms do not include a fax: (i) to any person with that person's prior express invitation or permission; or (ii) to any person with whom the REPRESENTATIVE has an established business or personal relationship.  The term "established business or personal relationship" means a prior or existing relationship formed by a voluntary two way communication between a REPRESENTATIVE and a person, on the basis of: (i) an inquiry, application, purchase or transaction by the person regarding products offered by such REPRESENTATIVE; or (ii) a personal or familial relationship, which relationship has not been previously terminated by either party. 

3.11 - Compensation Plan Manipulation Prohibited

Compensation Plan manipulation is strictly and absolutely prohibited. Also known as  “Bonus buying”, this includes: (1) the referral of individuals or entities without the knowledge of and/or execution of an Independent REPRESENTATIVE Application and AGREEMENT by such individuals or entities; (2) the fraudulent enrollment of an individual or entity as a REPRESENTATIVE or customer; (3) the enrollment or attempted enrollment of non-existent individuals or entities as REPRESENTATIVE or customers (“phantoms”); (4) purchasing the COMPANY’S products or services on behalf of another REPRESENTATIVE or customer, or under another REPRESENTATIVE’S or Customer’s I.D. number, to qualify for commissions or bonuses; (5) any other mechanism or artifice to qualify for incentives, prizes, commissions or bonuses that is not driven by bona fide products or services purchased by end user consumers. 

3.12 - Business Entities

A corporation, limited liability company (LLC), partnership or trust (collectively referred to in this section as a “Business Entity”) may apply to be a COMPANY REPRESENTATIVE. Members of the entity are jointly and severally liable for any indebtedness or other obligation to the COMPANY.

      To prevent the circumvention of any portion of Section 4, if an additional partner, shareholder, member, or other Business Entity affiliate is added to a Business Entity, the original applicant must remain as a party to the original REPRESENTATIVE Application and AGREEMENT.  If the original REPRESENTATIVE wants to terminate his or her relationship with the COMPANY, he or she must transfer or assign his or her business in accordance with Section 3.15 below.  If this process is not followed, the business shall be canceled upon the withdrawal of the original REPRESENTATIVE.  All bonus and commission checks will be sent to the address of record of the original REPRESENTATIVE.  Please note that the modifications permitted within the scope of this paragraph do not include a change of referral.  The COMPANY may, at its discretion, require notarized documents before implementing any changes to a REPRESENTATIVE business.  Please allow thirty (30) days after the receipt of the request by the COMPANY for processing.

3.13 - Changes to a Business Entity

A REPRESENTATIVE’S business may change its status under the same referral from an individual to a partnership, LLC, corporation or trust, or from one type of entity to another.  There is a fee for each change requested, which must be included with the written request and the completed REPRESENTATIVE Application and AGREEMENT and Entity Documents.  In addition, REPRESENTATIVES operating their businesses utilizing a Business Entity must notify the COMPANY of the addition or removal of any officers, directors, shareholders, managers, members or business associates of the business entity.

3.14 - Change of Referral

      To protect the integrity of all Marketing Organizations (genealogies) and safeguard the hard work of all REPRESENTATIVES, the COMPANY strongly discourages changes in referral.  Maintaining the integrity of referral is critical for the success of every REPRESENTATIVE and Marketing Organization.  Accordingly, the transfer of a REPRESENTATIVE business from one sponsor to another is generally prohibited except under strict and compelling circumstances and is granted at the sole discretion of the COMPANY. 

      Requests for change of referral must be submitted in a written and notarized affidavit to the Compliance Department, and must include the reason for the transfer.  Transfers will only be considered in the following circumstance:

      In cases in which the new REPRESENTATIVE is referred by someone other than the individual he or she was led to believe would be his or her sponsor, a REPRESENTATIVE may request he or she be transferred to another organization with his or her entire Marketing Organization intact.  All requests for transfer alleging fraudulent enrollment practices shall be evaluated on a case by case basis and must be made within thirty (30) days from the date of enrollment.  The REPRESENTATIVE requesting the change has the burden of proving he or she was placed beneath the wrong referrer.        

In cases wherein the appropriate referral change procedures have not been followed, and a Marketing Organization and a second business is developed by a REPRESENTATIVE, the COMPANY reserves the sole and exclusive right to determine the final disposition of the Marketing Organization.  Resolving conflicts over the proper placement of a business which has developed under an organization that has improperly switched referrers is often extremely difficult.  Therefore, REPRESENTATIVE WAIVES ANY AND ALL CLAIMS AGAINST THE COMPANY THAT RELATE TO OR ARISE FROM THE COMPANY’S DECISION REGARDING THE DISPOSITION OF ANY MARKETING ORGANIZATION WHICH DEVELOPS BELOW AN ORGANIZATION THAT HAS IMPROPERLY CHANGED LINES OF REFERRAL. 

3.15 - Cancellation and Re-application

A REPRESENTATIVE, whether an individual or business entity, may legitimately change referring organizations by voluntarily cancelling his or her business and remaining inactive (i.e., no sales of the COMPANY’S products, no referring, no attendance at any of the COMPANY’S functions, no participation in any other form of REPRESENTATIVE activity, and no operation of any other business of the COMPANY or its affiliated entities) for six (6) full calendar months.  Following the six (6) month period of inactivity, the former REPRESENTATIVE may reapply under a new referrer.

3.16 – Indemnification for Unauthorized Claims

A REPRESENTATIVE is fully responsible for all of his or her verbal and written statements made regarding the COMPANY’S products, services, and the Compensation Plan which are not expressly contained in the official COMPANY’S material.  REPRESENTATIVE agrees to indemnify the COMPANY and the COMPANY’S directors, officers, shareholders, employees, and agents, and hold them harmless from any and all liability including judgments, civil penalties, refunds, attorney fees, investigation costs, court costs, or lost business incurred by the COMPANY as a result of the REPRESENTATIVE’S unauthorized representations or actions.  This provision shall survive the termination of the REPRESENTATIVE AGREEMENT.

3.17 - Income or Lifestyle Claims

The Federal Trade Commission and several states have laws or regulations that regulate or even prohibit certain types of income claims and testimonials made by persons engaged in network marketing. REPRESENTATIVES may not make any income claims. The Liberty Freedom Network compensation plan sets forth the maximum amount that may be earned daily, weekly, monthly and annually. Liberty Freedom Network does not make any representations or guarantees of any minimum or maximum amounts of income that can be earned. 

3.18 - Trade Shows, Expositions and Other Sales Forums

REPRESENTATIVES may display and/or sell the COMPANY’S products at trade shows and professional expositions but only as long as they are in compliance with Section 3.3 Advertising above.  REPRESENTATIVES are not permitted the use any of the COMPANY’S or any of its affiliated companies’ or any third party’s trade names, trademarks, designs, symbols or media. Before submitting a deposit to the event promoter, REPRESENTATIVE must contact the Compliance Department in writing for conditional approval, as the COMPANY’S policy is to authorize only one REPRESENTATIVE business per event.  Final approval will be granted to the first REPRESENTATIVE who submits an official advertisement of the event, a copy of the contract signed by both the REPRESENTATIVE 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 Customer Support Department.  The COMPANY 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, services, or the COMPANY’S opportunity. 

3.19 - Conflicts of Interest

During the term of this AGREEMENT, REPRESENTATIVE may not directly or indirectly attempt to enroll the COMPANY’S REPRESENTATIVE or Customers for any other network marketing business. 

Following the cancellation of a REPRESENTATIVE’S AGREEMENT, and for a period of six (6) calendar months thereafter, with the exception of a REPRESENTATIVE who was personally referred by the former REPRESENTATIVE, a former REPRESENTATIVE may not recruit any of the COMPANY’S REPRESENTATIVES or Customers for another network marketing business.  REPRESENTATIVE and the COMPANY recognize 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, REPRESENTATIVE and the COMPANY agree that this non-solicitation provision shall apply to all markets in which the COMPANY conducts business.

REPRESENTATIVE must not sell, endorse or attempt to sell, any competing programs, products or services to the COMPANY’S Customers or other REPRESENTATIVES.  Any program, product or service in the same generic categories as the COMPANY’S products or services are deemed to be competing, regardless of differences in cost, quality, or distinguishing factors.

If a REPRESENTATIVE is engaged in another direct selling program, it is the responsibility of the REPRESENTATIVE to ensure that his or her COMPANY’S business is operated entirely separate and apart from any other program in which the REPRESENTATIVE participates.  To this end, the following must be adhered to:

a)   The REPRESENTATIVE shall not display the COMPANY’S promotional materials, sales aids, products or services with or in the same location as any other network marketing company’s promotional materials, sales aids, products or services including personal websites.

b)   The REPRESENTATIVE may not offer the COMPANY’S opportunity, products or services to prospective or existing Customers or REPRESENTATIVES in conjunction with any other network marketing company’s program, opportunity, product or service. 

c)   The REPRESENTATIVE may not offer any other network marketing company’s opportunity, products, services, or opportunity at any COMPANY meeting, seminar or convention, or within two hours and a five (5) mile radius of the COMPANY’S event.  If the COMPANY meeting is held telephonically or via the internet, any other network marketing COMPANY meeting must be at least two hours before or after the COMPANY’S meeting, and on a different conference telephone number or internet web address from the COMPANY’S meeting.

Genealogy Reports are available for REPRESENTATIVE access and viewing in the Virtual Office of each REPRESENTATIVE’S replicated website.  Access to online Genealogy Reports is password protected.  All Genealogy Activity Reports and the information contained therein are confidential and constitute proprietary information and business trade secrets belonging to the COMPANY.  Genealogy Reports are provided to REPRESENTATIVES in strictest confidence and are made available to REPRESENTATIVE for the sole purpose of assisting REPRESENTATIVE in working with their respective Marketing Organization in the development of their COMPANY business.  REPRESENTATIVES should use their Genealogy Reports only to assist, motivate, and train their business REPRESENTATIVES. The REPRESENTATIVE and the COMPANY agree that, but for this agreement of confidentiality and nondisclosure, the COMPANY would not provide Genealogy Reports to the REPRESENTATIVE.  A REPRESENTATIVE shall not, on his or her own behalf, or on behalf of any other person, partnership, association, corporation or other entity:

a)     Directly or indirectly use, sell or disclose any information contained in any Genealogy Report to any third party;

b)    Directly or indirectly disclose the password or other access code to his or her Genealogy Report to any third party;

c)     Use the information contained in any Genealogy Report to compete with the COMPANY or for any purpose other than promoting or supporting his or her business; or

d)    Recruit or solicit REPRESENTATIVES or Customers listed on any Genealogy Report or in any manner attempt to influence or induce any REPRESENTATIVE or Customer to alter their business relationship with the COMPANY.

      Upon demand by the COMPANY, any current or former REPRESENTATIVE will return the original and all copies of Genealogy Reports to the COMPANY.

If a REPRESENTATIVE attempts to cross recruit the COMPANY’S other REPRESENTATIVES or Customers to a competing network marketing entity utilizing contacts gained from the proprietary information contained in the COMPANY'S Genealogy Reports, the REPRESENTATIVE agrees that for each occurrence of a documented attempt (i.e. email solicitation, recorded telephone call, letter, personalized brochure or business card) liquidated damages will be due the COMPANY in the amount of $10,000 per person, per occurrence.

3.20 - Targeting Other Direct Sellers

The COMPANY does not condone REPRESENTATIVES specifically or knowingly targeting the sales force of another direct sales company to sell the COMPANY’S products or to become REPRESENTATIVES for the COMPANY, nor does the COMPANY condone REPRESENTATIVE’S solicitation or enticement of members of the sales force of another direct sales company to violate the terms of their contract with such other company.  Should REPRESENTATIVE engage in such activity, they bear the risk of being sued by the other direct sales company.  If any lawsuit, arbitration or mediation is brought against a REPRESENTATIVE and/or the COMPANY alleging that the REPRESENTATIVE engaged in inappropriate recruiting activity of its sales force or customers, (i) the COMPANY will not pay any of REPRESENTATIVE’S defense costs or legal fees, nor will the COMPANY indemnify the REPRESENTATIVE for any judgment, award, or settlement and (ii) REPRESENTATIVE shall indemnify and hold COMPANY and its parents, subsidiaries or affiliates and its and their officers, directors, employees and agents harmless from and against any such claim, obligation, demand, lawsuit, arbitration, mediation, loss, damages or costs, including attorneys’ fees, cost of defense or cost of settlement.  

3.21 – Cross Recruiting

Actual or attempted cross recruiting is strictly prohibited.  “Cross recruiting” is defined as the enrollment or attempted enrollment of an individual who, or entity that, already has a current REPRESENTATIVE AGREEMENT on file with the COMPANY, or who has had such an agreement within the preceding six (6) calendar months, within a different line of referral.  The use of a spouse’s or relative’s name, trade names, DBAs, assumed names, corporations, partnerships, trusts, Federal ID Numbers, fictitious ID numbers or any other artifice to circumvent this policy is strictly prohibited.  REPRESENTATIVE shall not demean, discredit or defame other COMPANY’S REPRESENTATIVES in an attempt to entice another REPRESENTATIVE to become part of the first REPRESENTATIVE’S Marketing Organization. 

If Cross Recruiting is discovered, it must be brought to the COMPANY’S attention immediately.  The COMPANY may take disciplinary action against the REPRESENTATIVE who changed organizations and/or those REPRESENTATIVES who encouraged or participated in the Cross Recruiting.  The COMPANY may also move all or part of the offending REPRESENTATIVE’S Marketing Organization to his or her original Marketing Organization if the COMPANY deems it equitable and feasible to do so.  However, the COMPANY is under no obligation to move the Cross Recruited REPRESENTATIVE’S Marketing Organization, and the ultimate disposition of the organization remains within the sole discretion of the COMPANY.  REPRESENTATIVE waives all claims and causes of action against the COMPANY arising from or relating to the disposition of the Cross Recruited (Referred) REPRESENTATIVE’S Marketing Organization.

3.22 - Errors or Questions

If a REPRESENTATIVE has questions about or believes any errors have been made regarding commissions, bonuses, Genealogy Reports, or charges, the REPRESENTATIVE must notify the COMPANY in writing within sixty (60) days of the date of the purported error or incident in question.  The COMPANY will not be responsible for any errors, omissions or problems not reported to the COMPANY within sixty (60) days.

3.23 - Governmental Approval or Endorsement

Neither federal nor state regulatory agencies approve or endorse any direct selling or network marketing companies or programs.  Therefore, REPRESENTATIVE shall not represent or imply the COMPANY or its Compensation Plan have been "approved," "endorsed" or otherwise sanctioned by any government agency.

3.24 - Holding Applications or Orders

REPRESENTATIVE must not manipulate or delay enrollments of new applicants and purchases of services or products. 

3.25 - Identification

All REPRESENTATIVES are required to provide their valid Social Security Number (“SSN”), or a valid Federal Employer Identification Number (“FEIN”) to the COMPANY on the REPRESENTATIVE Application and AGREEMENT.  Upon enrollment, the COMPANY will provide a unique REPRESENTATIVE Tracking Identification Number (TID) to the REPRESENTATIVE by which he or she will be identified.  This number will be used to place orders, and track commissions and bonuses.  The failure of a REPRESENTATIVE to supply a valid SSN or FEIN shall result in immediate dismissal.

3.26 - Income Taxes

Each REPRESENTATIVE is responsible for paying local, state and federal taxes on any income generated as an Independent REPRESENTATIVE.  If a REPRESENTATIVE’S business is tax exempt, the Federal Tax Identification Number must be provided to the COMPANY.  Every year, the COMPANY will provide an IRS Form 1099 MISC (Non-employee Compensation) earnings statement to each U.S. resident who: (1) Had earnings of over $600 in the previous calendar year; or (2) Made purchases during the previous calendar year in excess of $5,000.

3.27 - Independent Contractor Status

REPRESENTATIVES are independent contractors, and are not purchasers of a franchise or a business opportunity.  The AGREEMENT between the COMPANY and its REPRESENTATIVE does not create an employer/employee relationship, agency, partnership, or joint venture between the COMPANY and the REPRESENTATIVE.  REPRESENTATIVE shall not be treated as an employee for his or her services or for federal or state tax purposes.  Each REPRESENTATIVE shall establish his or her own goals, hours, and methods of sale, so long as he or she complies with the terms of the REPRESENTATIVE AGREEMENT and applicable laws (Please see Section 13.1 [a] of Terms and Conditions).

The name of the COMPANY and other names as may be adopted by the COMPANY are proprietary trade names, trademarks and service marks of the COMPANY.  As such, these marks are of great value to the COMPANY and are supplied to REPRESENTATIVE for their use only in an expressly authorized manner.  Use of the COMPANY name on any item not produced by the COMPANY is prohibited.

3.28 - REPRESENTATIVE’S Name

All REPRESENTATIVES may list themselves as an “Independent Contractor” or “Independent Representative” in the white or yellow pages of the telephone directory under their own name. No REPRESENTATIVE may place telephone directory display ads using the COMPANY’S name or logo.  REPRESENTATIVE may not answer the telephone by saying the COMPANY name, or in any other manner that leads the caller to believe he or she has reached corporate offices of the COMPANY.

3.29 - International Marketing

Because of critical legal, monetary and tax considerations, the COMPANY must limit the resale of the COMPANY’S products and services, and the presentation of the COMPANY’S business to prospective customers and REPRESENTATIVES located within the United States and U.S. Territories and those other countries that the COMPANY has announced are officially open for business.  Moreover, allowing a few REPRESENTATIVES to conduct business in markets not yet opened by the COMPANY would violate the concept of affording every REPRESENTATIVE the equal opportunity to expand internationally.

Accordingly, REPRESENTATIVES are authorized to sell the COMPANY products and services, and enroll Customers or REPRESENTATIVES only in the countries in which the COMPANY is authorized to conduct business, as announced in official COMPANY literature.  The COMPANY products or sales aids cannot be shipped into or sold in any other foreign country.  REPRESENTATIVE may sell, give, transfer, or distribute the COMPANY products or sales aids only in their home country.  In addition, no REPRESENTATIVE may, in any unauthorized country: (1) conduct sales, enrollment or training meetings; (2) enroll or attempt to enroll potential customers or REPRESENTATIVES; or (3) conduct any other activity for the purpose of selling the COMPANY products, establishing a Marketing Organization, or promoting the COMPANY opportunity.

3.30 - Confidentiality

“Confidential Information” means any and all information the COMPANY designates as being confidential or which, under the circumstances surrounding disclosure, would reasonably be expected to be or should to be treated as confidential.  Confidential Information includes, without limitation, REPRESENTATIVE’S customer lists and data, information relating to genealogical or business reports, pricing, technical information, research, development, procedures, algorithms, data, designs, know-how, the marketing or promotion of any of the COMPANY’S products or services, the COMPANY’S business policies, practices or operations, information received from others that the COMPANY is obligated to treat as confidential and information regarding the COMPANY’S respective parents, subsidiaries and affiliated agents. Confidential Information also includes commercial secrets, trade secrets, supplier commission percentages and related information, and any internal information of the COMPANY.  Confidential Information is proprietary and confidential to the COMPANY.  It is provided to the REPRESENTATIVE in strictest confidence.

a.   Lists and data are for the limited use of the REPRESENTATIVE to facilitate training, support and to further the REPRESENTATIVE’S business only.  Each REPRESENTATIVE agrees that the use of the COMPANY’S REPRESENTATIVE-customer lists or other lists or data constitutes a non-exclusive license between the REPRESENTATIVE and the COMPANY for the REPRESENTATIVE’S limited use thereof, as more fully set forth below.

b.   Lists, data and information relating to REPRESENTATIVE or customers remain, at all times, the exclusive property of the COMPANY and must be returned to the COMPANY upon request.  A REPRESENTATIVE receiving such a list, data or information, whether from the COMPANY or from another source, agrees:

i.       To limit the use of a list to the intended scope of the list and to exclusively advance a REPRESENTATIVE’S business;

ii.       To hold confidential and not disclose any portion thereof to any third party, including, but not limited to; existing REPRESENTATIVES, competitors, and the general public.  Any use or disclosure of lists, outside of those authorized, constitutes misuse, misappropriation, and a violation of the AGREEMENT, and will cause irreparable harm to the COMPANY;

iii.      That, upon any violation of this section, the REPRESENTATIVE agrees (1) the COMPANY, shall be entitled to in addition to any other rights and remedies available to the COMPANY at law or in equity, injunctive relief, enjoining such use under applicable national or local law, and (2) he or she will retrieve and return to the COMPANY all existing lists previously provided to the REPRESENTATIVE;

iv.      That intended or unintended misuse of a list, data or information may be cause for termination of a REPRESENTATIVE; and,

v.             That the obligations under this section will survive the termination or expiration of the AGREEMENT.

c. The COMPANY reserves the right to pursue all appropriate remedies under applicable federal, state or local laws to protect its rights to the Confidential Information, proprietary information and trade secrets of the COMPANY, and any failure to pursue such remedies in one instance will not constitute a waiver of those rights by the COMPANY in any other circumstances.

Each REPRESENTATIVE agrees he/she will not use such lists, data or information to compete with the COMPANY or for any other purpose other than to promote his/her COMPANY-related business activities.

Any REPRESENTATIVE who is found to be in violation of this section may be subject to disciplinary action and, in addition to all other rights and remedies available to the COMPANY at law or in equity, the COMPANY may seek remedies for compensatory and punitive damages, injunctive relief exclusive of the remedies available in Section 9 below, for specific performance to the fullest extent that the law makes available.

 

SECTION 4 – REQUIREMENTS

4.1 - Adherence to Laws and Ordinances

      REPRESENTATIVE shall comply with all federal, state, and local laws and regulations in the conduct of their businesses.  Many cities and counties have laws regulating certain home-based businesses.  In some cases these ordinances are not applicable to REPRESENTATIVE because of the nature of their business.  However, REPRESENTATIVES must obey those laws that do apply to them.  If a city or county official tells a REPRESENTATIVE an ordinance applies to him or her, the REPRESENTATIVE shall be polite and cooperative, and immediately send a copy of the ordinance to the Compliance Department of the COMPANY for review. 

4.2 - Minors

      The COMPANY recognizes that children are the key to family legacies and the future of the business.  Therefore, while we welcome minors becoming REPRESENTATIVES for the COMPANY said application must be accompanied by and documented via e-Signature by the minor’s parent or legal guardian. There are no other exceptions to this rule so REPRESENTATIVES should not refer, enroll or recruit minors into the COMPANY’S program unless they are the parent or legal guardian of said minor.

4.3 - Divorce or Dissolution

a)  If married persons or partners who share ownership in a REPRESENTATIVE business obtain a divorce or wish to dissolve their partnership, corporation or limited liability company, the COMPANY will continue to treat them pursuant to the controlling party being the designated primary applicant at the time of filing of a petition in a court of jurisdiction for divorce or dissolution, until such time as the COMPANY receives written notice from both parties or an appropriate court order directing otherwise.  The written notice must be signed by all parties. 

b)  Divorced persons or dissolved partnerships, corporations or limited liability companies must submit to the COMPANY a certified copy of any legal judgment or decree, or jointly specify in writing to the COMPANY, as to ownership and/or how future commission and bonus checks should be paid.

4.4 - Actions of Household Members or Affiliated Individuals

If any member of a REPRESENTATIVE’S immediate household engages in any activity which, if performed by the REPRESENTATIVE, would violate any provision of the AGREEMENT, such activity will be deemed a violation by the REPRESENTATIVE and the COMPANY may take disciplinary action pursuant to the AGREEMENT against the REPRESENTATIVE.  Similarly, if any individual associated in any way with a corporation, partnership, trust or other entity (collectively “affiliated individual”) violates the AGREEMENT, such action(s) will be deemed a violation by the entity, and the COMPANY may take disciplinary action against the entity.

4.5 - Requests for Records

Any request from a REPRESENTATIVE for copies of invoices, applications, Genealogy Reports, or other records requires a fee of $1.50 per page per copy.  This fee covers the expense of mailing and time required to research files and produce copies of same.

4.6- Sale, Transfer or Assignment of Your Business

Although a REPRESENTATIVE’S business is a privately owned, independently operated business, the sale, transfer or assignment of such a business entity is subject to certain limitations.  If a REPRESENTATIVE wishes to sell his or her business, the following criteria must be met:

a)     Protection of the existing line of referral must always be maintained so the COMPANY’S business continues to be operated in that line of referral. 

b)    The buyer or transferee must become qualified as a REPRESENTATIVE.  If the buyer is an active REPRESENTATIVE, he or she must first terminate his or her original businesses and wait six (6) calendar months before acquiring any interest in the new business.

c)     Before the sale, transfer or assignment can be finalized and approved by the COMPANY, any debt obligations the selling REPRESENTATIVE has with the COMPANY must be satisfied.

d)    The selling REPRESENTATIVE must be in good standing and not in violation of any of the terms of the AGREEMENT in order to be eligible to sell, transfer or assign a REPRESENTATIVE’S business.

e)     The sale, transfer or assignment must occur six (6) months after the business was obtained by the REPRESENTATIVE.

f)     The COMPANY’S administrative fee for this type of business transfer is $450 and must be submitted to the COMPANY with the appropriate supporting documentation.

Prior to selling a COMPANY business, the selling REPRESENTATIVE must notify the COMPANY’S Compliance Department of his or her intent to sell their business.  Upon completed execution of the purchase and sale agreement, the parties must submit copies of same to the Compliance Department for review, along with the above business transfer fee.  The COMPANY reserves the right to request additional documentation that may be necessary to analyze the transaction between the buyer and seller.  The Compliance Department will, in its sole and absolute discretion, approve or deny the sale, transfer or assignment within thirty (30) days after receipt of all necessary documents from the parties.

If the parties fail to obtain the COMPANY’S approval for the transaction, the transfer shall be voided at the COMPANY’S option and the business transfer fee will be returned. 

If the sale is allowed, the purchaser of the existing business will assume all the obligations of that position of the selling REPRESENTATIVE. 

A REPRESENTATIVE who sells his or her business shall not be eligible to re-apply as a REPRESENTATIVE for a period of at least six (6) full calendar months after the date of the sale. 

No changes in line of referral can result from the sale or transfer of a business.

4.7 - Separation of a REPRESENTATIVE’S Business

The COMPANY’S REPRESENTATIVES sometimes operate their business as husband-wife partnerships, regular partnerships, corporations, LLCs or trusts.  At such time as a marriage may end in divorce or a corporation, partnership or trust (the latter four [4] entities are collectively referred to herein as “entities”) may dissolve, arrangements must be made to ensure any separation or division of the business is accomplished so as not to adversely affect the interests and income of other businesses up or down the line of referral.  If the separating parties fail to provide for the best interests of other REPRESENTATIVES and the COMPANY in a timely fashion, the COMPANY will involuntarily terminate the REPRESENTATIVE AGREEMENT.

      During the divorce or entity dissolution process, the parties must adopt one of the following methods of operation:

a)     One of the parties may, with consent of the other(s), operate their business pursuant to an assignment in writing whereby the relinquishing spouse, shareholders, partners or trustees authorize the COMPANY to deal directly and solely with the remaining spouse or non-relinquishing shareholder, partner or trustee.

b)    The parties may continue to operate their business jointly on a “business-as-usual” basis, whereupon all compensation paid by the COMPANY 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 Marketing Organization of divorcing spouses or a dissolving business entity be divided.  Similarly, under no circumstances will the COMPANY split commission and bonus checks between divorcing spouses or members of dissolving entities.  The COMPANY will recognize only one Marketing Organization and will issue only one commission check per the COMPANY’S 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 REPRESENTATIVE AGREEMENT shall be involuntarily canceled.

If a former spouse has completely relinquished all rights in the original business pursuant to a divorce, he or she is thereafter free to enroll under any referrer of his or her choosing without waiting six (6) 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 (6) calendar months from the date of the final dissolution before re-enrolling as a REPRESENTATIVE.  In either case, however, the former spouse or business affiliate shall have no rights to any REPRESENTATIVE 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 REPRESENTATIVE.

4.8 - Referring and Enrolling

All active REPRESENTATIVES in good standing have the right to refer and enroll others into the COMPANY.  Each prospective Customer or REPRESENTATIVE has the ultimate right to choose his or her own Referrer.  If two REPRESENTATIVES claim to be the Referrer of the same new REPRESENTATIVE or Customer, the COMPANY shall regard the first application received by the COMPANY as controlling.

4.9 – Succession Upon Death or Incapacitation

Upon the death or incapacitation of a REPRESENTATIVE, his or her business may be passed to his or her heirs.  Appropriate legal documentation must be submitted to the COMPANY to ensure the transfer is proper.  Accordingly, a REPRESENTATIVE should consult an attorney to assist him or her in the preparation of a will or other testamentary instrument.  Whenever a business is transferred by a will or other testamentary process, the beneficiary acquires the right to collect all bonuses and commissions of the deceased REPRESENTATIVE’S Marketing Organization provided the following qualifications are met.  The successor(s) must:

a)   Complete and execute a REPRESENTATIVE AGREEMENT;

b)   Comply with terms and provisions of the AGREEMENT; and

c)   Meet all of the qualifications for the deceased REPRESENTATIVE’S status.

Bonus and commission checks of a business transferred pursuant to this section will be paid in a single check jointly to the devisees.  The devisees must provide the COMPANY with an “address of record” to which all bonus and commission checks will be sent.  If the business is bequeathed to joint devisees, they must form a business entity and acquire a Federal Taxpayer Identification Number.  The COMPANY will issue all bonus and commission checks and one 1099 to the business entity.

4.10 - Transfer Upon Death of a REPRESENTATIVE

To effectuate a testamentary transfer of a business, the Personal Representative or Executor of the estate of the deceased REPRESENTATIVE must provide all necessary documentation to establish a successor’s or successors’ right to the COMPANY business.  The successor or successors must complete and execute a REPRESENTATIVE AGREEMENT and meet the other requirements set forth in Section 3.

4.11 - Transfer Upon Incapacitation of a REPRESENTATIVE

To effectuate a transfer of a business because of incapacity, the Trustee of the incapacitated REPRESENTATIVE must provide all necessary documentation to establish the right of the subject Trust and Trustee to the COMPANY business.  The Trustee must, on behalf of the Trust, complete and execute a REPRESENTATIVE AGREEMENT and meet the other requirements set forth in Sections 2 and 3.

4.12- Telemarketing Techniques 

The Federal Trade Commission and the Federal Communications Commission each have laws restricting telemarketing practices.  Both federal agencies (as well as a number of states) have “do not call” regulations as part of their telemarketing laws.  Although the COMPANY does not consider REPRESENTATIVES 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 a REPRESENTATIVE to violate the law.  Moreover, these regulations must not be taken lightly, as they carry significant penalties (up to $11,000.00 per violation). 

Therefore, REPRESENTATIVE must not engage in telemarketing in the operation of their COMPANY business.  The term “telemarketing” means the placing of one or more telephone calls to an individual or entity to induce the purchase of the COMPANY’S products or services, or to enroll them for the COMPANY’S opportunity.  “Cold calls" made to prospective Customers or REPRESENTATIVES that promote either the COMPANY’S products or services or the COMPANY’S opportunity, constitute telemarketing and are prohibited.  However, a telephone call(s) placed to a prospective customer (a "prospect") is permissible under the following situations:           

a)   If the REPRESENTATIVE has an established business relationship with the prospect.  An “established business relationship” is a relationship between a REPRESENTATIVE and a prospect based on the prospect’s purchase, rental, or lease of goods or services from the REPRESENTATIVE, or a financial transaction between the prospect and the REPRESENTATIVE, within the eighteen (18) months immediately preceding the date of a telephone call to induce the prospect's purchase of a product or service.

b)   The prospect’s personal inquiry or application to the REPRESENTATIVE regarding a product or service offered by the COMPANY, within the three (3) months immediately preceding the date of such a call.

c)   If the REPRESENTATIVE receives written and signed permission from the prospect authorizing the REPRESENTATIVE to call.  The authorization must specify the telephone number(s) which the REPRESENTATIVE is authorized to call.

d)   A REPRESENTATIVE may call family members, personal friends, and acquaintances.  An “acquaintance” is someone with whom a REPRESENTATIVE has at least a recent first-hand relationship within the preceding three (3) months.  However, if a REPRESENTATIVE makes a habit of “card collecting” with everyone the REPRESENTATIVE meets and subsequently calling them, the FTC may consider this a form of telemarketing that is not subject to this exemption.   Thus, if a REPRESENTATIVE engages in calling “acquaintances,” he or she must make such calls on an occasional basis only and not make this a routine practice.     

e)   In addition, REPRESENTATIVES shall not use automatic telephone dialing systems relative to the operation of their COMPANY’S business. 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.

 

Section 5 – ONGOING RESPONSIBILITIES OF REPRESENTATIVE

5.1 - Change of Address, Telephone, or Email Address

To ensure timely delivery of support materials or other mailings by the COMPANY, it is critically important that the COMPANY’S files are current.  REPRESENTATIVES who change their address, telephone number or email address must update their personal information via the “Business Suite” Virtual Office function of the REPRESENTATIVE’S replicated website. 

5.2 - Continuing Development Obligations

Ongoing Training

Any REPRESENTATIVE who refers or enrolls another REPRESENTATIVE into a position in the COMPANY, must perform a bona fide assistance and training function to ensure his or her Marketing Organization is properly operating.  REPRESENTATIVE must have ongoing contact and communication with the REPRESENTATIVES in their Marketing 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 business REPRESENTATIVES to the COMPANY’S meetings, training sessions, and other functions.  Upline REPRESENTATIVES are also responsible to motivate and train new REPRESENTATIVES in the COMPANY’S product and service knowledge, effective sales techniques, the COMPANY’S Compensation Plan, and compliance with the COMPANY’S AGREEMENT.  Communication with and the training of business REPRESENTATIVES must not, however, violate Section 3.1 (regarding the development of REPRESENTATIVE-produced sales aids and promotional materials).

REPRESENTATIVE must monitor REPRESENTATIVES in their Marketing Organizations to ensure that business REPRESENTATIVES do not make improper product or business claims, or engage in any illegal or inappropriate conduct.  Upon request, every REPRESENTATIVE should be able to provide documented evidence to the COMPANY of his or her ongoing fulfillment of the responsibilities of a Referrer.

Increased Training Responsibilities

As REPRESENTATIVES progress through the various levels of success, they will become more experienced in sales techniques, product knowledge, and understanding of the COMPANY program.  They will be called upon to share this knowledge with lesser experienced REPRESENTATIVES within their organization.

Ongoing Sales Responsibilities

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

5.3 - Non-disparagement

The COMPANY wants to provide REPRESENTATIVES with the best products, compensation plan, and service in the industry.  Accordingly, the COMPANY values your constructive criticisms and comments.  All such comments should be submitted in writing to the Customer Support Department.  To best serve you, the COMPANY must hear from you.  While the COMPANY welcomes constructive input, negative comments and remarks made in the field by REPRESENTATIVES about the COMPANY, its products, or Compensation Plan serve no purpose other than to dampen the enthusiasm of the COMPANY’S REPRESENTATIVES.  For this reason, and to set the proper example for their Marketing Organization, REPRESENTATIVE must not disparage, demean, or make negative remarks about the COMPANY, other COMPANY’S REPRESENTATIVES, the COMPANY’S products, the Compensation Plan, or the COMPANY’S directors, officers, or employees. 

5.4 - Providing Documentation to Applicants

REPRESENTATIVE must provide the location of the Virtual Office, the most current version of the Policies and Procedures, Compensation Plan, Cancellation Policy and methods of contact for Customer Support to individuals whom they are enrolling to become a REPRESENTATIVE before the applicant signs a REPRESENTATIVE AGREEMENT.  Additional copies of Policies and Procedures and Compensation Plan can be downloaded from the COMPANY’S website.

5.5 - Reporting Policy Violations

REPRESENTATIVES observing a Policy violation by another REPRESENTATIVE should submit a written report of the violation directly to the attention of the COMPANY’S Compliance Department.  Details of the incidents such as dates, number of occurrences, persons involved, and any supporting documentation should be included in the report.  Alternatively, these reports may be telephoned into the Compliance Department during normal business hours or, submit a statement documenting the names and facts involved to the Compliance Department of the COMPANY at  the following email address:  Compliance@Liberty Freedom Network.com.

5.6 - Vendor Confidentiality/Communications

The COMPANY’S business relationships with its marketing alliances, merchants, suppliers, COMPANY associates or former employees within or outside the corporate workplace are confidential, proprietary, and not to be circumvented by either the REPRESENTATIVE or the merchant. A REPRESENTATIVE shall not contact, directly or indirectly, or speak to or communicate with any representative of any supplier or manufacturer or merchant of the COMPANY except at a COMPANY-sponsored event at which the representative is present at the request of the COMPANY or as otherwise expressly permitted in writing by the COMPANY. Violation of this regulation may result in termination of the REPRESENTATIVE and possible claims of damages against the REPRESENTATIVE and/or the merchant. Questions regarding any of these businesses should be directed to the Compliance Department.

REPRESENTATIVES shall not negotiate with merchants or suppliers in any industry on behalf of the COMPANY, including, but not limited to, attempting to negotiate with any merchant or supplier for broker’s fees, finder’s fees or any other fees for arranging a possible transaction between the vender and/or supplier and the COMPANY.  Notwithstanding the foregoing, in the event a REPRESENTATIVE does arrange a transaction between the COMPANY and a third party, such REPRESENTATIVE will not be entitled to any brokers, finders, commission or other fee from the COMPANY or any of its affiliated entities.

 

SECTION 6 - SALES REQUIREMENTS

6.1 - Product Sales

The COMPANY’S Compensation Plan, is based on the sale of the COMPANY’S products and services to end consumers.  REPRESENTATIVES at each level must fulfill personal and/or retail sales requirements (as well as meet other obligations set forth in the AGREEMENT and the COMPANY’S Compensation Plan) to be eligible for  bonuses and/or commissions.  Please become familiar with the Compensation Plan which can be viewed in your “Business Suite” Virtual Office.   

6.2 - No Territory Restrictions

There are no exclusive territories granted to anyone.  No franchise fees are required.

6.3 - Meetings

In order to show prospective new customers the COMPANY opportunity, REPRESENTITAVES are allowed to host their own meeting or invite persons to a planned COMPANY meeting or training event.  Regardless, when presenting the opportunity in any such a meeting, the REPRESENTATIVE must always do the following:

a) Use only Company approved media (i.e. REPRESENTATIVE’S replicated Company website, Overview, conference calls) to present the opportunity;

b) All prospects shall be admitted free of charge. However, the meeting organizer can charge a minimal amount for existing REPRESENTATIVES to offset the cost of the meeting;

 

SECTION 7 - BONUSES AND COMMISSIONS

7.1 - Bonus and Commission Qualifications

A REPRESENTATIVE must be active and in compliance with the AGREEMENT to qualify for bonuses and commissions.  As long as a REPRESENTATIVE complies with the terms of the AGREEMENT, the COMPANY shall pay commissions to such REPRESENTATIVE in accordance with the Compensation Plan.   The minimum amount for which the COMPANY will issue payment is $100.  If a REPRESENTATIVE’S bonuses, commissions or cash back does not equal or exceed $100, the COMPANY will accrue the commissions and bonuses until they total $100.  Payment will be issued once $100.00 has been accrued.

7.2 - Adjustment to Bonuses and Commissions

 REPRESENTATIVES receive bonuses and commissions based on the actual sales of products and services to end consumers in accordance with the Compensation Plan.  When a refund request is received by the COMPANY or a service is cancelled and when the customer is entitled to a refund, the bonuses and commissions attributable to the returned or repurchased product or the refunded service will be deducted.   

 

SECTION 8 – REFUNDS

8.1 - Cancellation Policy

As a REPRESENTATIVE, I understand that if I purchase a Fast Start Activation Pack (FSAP) at the time of sign-up, I am purchasing the products and services that come with my FSAP. Furthermore, I understand that sales of FSAPs are final and no refunds will be allowed. I understand there are no refunds on sales aids, including videos, audio tapes, literature, brochures, sales kits, Personal Gateway and other website subscriptions and "Buy 1, Sell 3, Get Yours FREE!" products that I have received without cost. I understand that open, unmarketable products may not be returned and that all sales are final 30 days after purchase. I understand that all returns are subject to a 10% restocking fee and shipping and handling will not be reimbursed. I understand there are no refunds on International/Supplemental funds for the Global Freedom Phone. I understand that I have a Business Suite that allows me to instantly cancel or modify my monthly auto-ship order, that I have set up, and if I intend to cancel my monthly auto-ship order, it is my responsibility to cancel it through clicking the "Cancel Auto-Ship" button in my "Auto-Ship - View" section. I understand that when I initially sign up as a Liberty Freedom Network Independent Representative, the payment information I use will automatically be used for my monthly auto-ship order and if I want different payment information used for my monthly auto-ship order, it is my duty to log into my Business Suite and update the payment information. I agree that I will not charge back or dispute any order or monthly subscription charges due Liberty Freedom Network and which have been charged to a credit card, accepted by Liberty Freedom Network, in payment for said order or subscription charges. This includes VISA, Master Card, Discover or American Express. I understand that any attempt, by me, to charge back my purchase(s) will constitute fraud and will be dealt with accordingly. I also agree that any cancellation after my monthly auto-ship order charge date will be effective on the next monthly billing date, of the order, and there will be no "partial month" refunds. I understand that the Liberty Freedom Network program is based on retail sales to the end consumer and not on the stockpiling of products. When submitting an order, I am certifying that I have consumed at least 70% of my previous order. I shall maintain and upon request, furnish a listing of my retail customers.

8.2 - Returns for Residents of Certain States 

The following section only applies to REPRESENTATIVES who are residents of Georgia, Louisiana, Maryland, Massachusetts, Wyoming and any other state that may require the following:

a)  A REPRESENTATIVE in this state 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.

Montana Residents

A Montana resident may cancel his or her REPRESENTATIVE AGREEMENT within fifteen (15) days from the date of enrollment.

8.3 - Chargebacks and Disputes

The COMPANY protects REPRESENTATIVES' Credit Card, purchase and personal data and it is COMPANY policy to immediately reverse any unauthorized transactions as long as the proper steps are followed. 

If there is an issue with a credit card charge pertaining to REPRESENTATIVE’S business with COMPANY, REPRESENTATIVE agrees to contact COMPANY and not the issuing Credit Card Company.  The REPRESENTATIVE must provide a reason for the dispute and all documentation in support thereof.  The following are acceptable reasons with proper records:

a)     The Credit Card holder had no prior knowledge of the charge; or

b)    Neither the Credit Card holder, nor any authorized user of the Credit Card, initiated the charge; or

c)     The Credit Card holder was charged multiple times for a single transaction; or

d)    The Credit Card holder was charged for shipped merchandise that was not received or arrived damaged.

Upon receipt, REPRESENTATIVE will be notified within three (3) business days of the COMPANY’S resolution. 

If a REPRESENTATIVE disputes (requests a Chargeback) a transaction with a Credit Card Company without following the above steps:

a)     The REPRESENTATIVE’S account will be immediately canceled; and

b)    All COMPANY accounts utilizing that Credit Card will be immediately canceled.  This may also be grounds for termination of the referrer if it is determined the transaction took place in violation of the AGREEMENT; and

c)     The REPRESENTATIVE(S) will forfeit his/her right to a refund as otherwise allowed in this AGREEMENT; and

d)    The REPRESENTATIVE(S) will forfeit all cash back, points, qualifications and/or commissions; and

e)     The REPRESENTATIVE(S) will not be allowed to reactivate. 

 

SECTION 9 - DISPUTE RESOLUTION AND DISCIPLINARY PROCEEDINGS

9.1 - Disciplinary Sanctions

A violation of the AGREEMENT or 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 a REPRESENTATIVE that, in the sole discretion of the COMPANY may damage it’s reputation or goodwill (such act or omission need not be related to the REPRESENTATIVE’S business) will be investigated fully.  Failure to cooperate with a Compliance investigation, including providing false or misleading information in an investigation may result, at the COMPANY’S discretion, in one or more of the following corrective measures:

a)      Issuance of a written warning or admonition;

b)      Requiring the REPRESENTATIVE to take immediate corrective measures;

c)      Imposition of a fine, which may be withheld from bonus and commission payment.  The fine, or a portion thereof, may be credited back to the REPRESENTATIVE’S account after successful conclusion of a probationary period (Section 9.1 [g] below) or the fine may be permanent in order to offset the cost of an investigation or potential restitution costs of the COMPANY;

d)     Loss of rights to one or more bonus and commission checks;

e)      The COMPANY may withhold from a REPRESENTATIVE all or part of the REPRESENTATIVE’S bonuses and commissions during the period that the COMPANY is investigating any conduct allegedly violating the AGREEMENT.  If a REPRESENTATIVE’S business is canceled for disciplinary reasons, the REPRESENTATIVE will not be entitled to recover any commissions withheld during the investigation period;

f)       Suspension of the individual’s REPRESENTATIVE AGREEMENT for one or more pay periods;

g)      Probationary period during which time any further infractions of the AGREEMENT will result in termination of the REPRESENTATIVE business.  During probation, a REPRESENTATIVE may continue to represent the COMPANY and build his or her Marketing Organization, can receive commissions but will not be paid bonuses or be eligible for promotions to higher levels;

h)      Termination of the offender’s REPRESENTATIVE AGREEMENT;

i)        Transfer of a portion or all of the REPRESENTATIVE’S Marketing Organization or business;

j)        Any other measure expressly allowed within any provision of the AGREEMENT or which the COMPANY deems practicable to implement and appropriate to equitably resolve injuries caused partially or exclusively by the REPRESENTATIVE’S policy violation or contractual breach; or

k)      In situations deemed appropriate by the COMPANY, the COMPANY may institute legal proceedings for monetary and/or equitable relief exclusive of the procedures outlined in Sections 9.4 and 9.5 below.

l)        COMPANY reserves the right to accept or deny any application or terminate anyone for any reason such as past or current felony convictions, acts of moral turpitude or other actions which, at the sole discretion of COMPANY, would harm the reputation of COMPANY or its current share- or stakeholders.

9.2 - Grievances and Complaints

When a REPRESENTATIVE has a grievance or complaint with another REPRESENTATIVE regarding any practice or conduct in relationship to their respective businesses, the complaining REPRESENTATIVE should first report the problem to his or her Referrer/Sponsor, who should review the matter and try to resolve it with the other party's upline Referrer/Sponsor.  If the matter involves interpretation or violation of the COMPANY’S policies, it must be reported in writing to the Compliance Department at the COMPANY.  The Compliance Department will review the facts and attempt to resolve it.  If the matter is not resolved, it will be referred to the Dispute Resolution Board for final review and determination.

9.3 - Dispute Resolution Board

The purpose of the Dispute Resolution Board (“DRB”) is to: (1) review appeals of disciplinary sanctions; and (2) review matters between the COMPANY’S REPRESENTATIVES.  After the response or settlement instituted by the Compliance Department has been denied or otherwise remains unresolved, upon written request, the DRB reviews evidence, deliberates, and responds to current outstanding issues on a collective basis. 

A REPRESENTATIVE may submit a written request for a telephonic or in-person hearing within seven (7) business days from the date of: (1) the written notice by the COMPANY of disciplinary action; or (2) the written decision of Compliance Department, as applicable, regarding disputes between REPRESENTATIVES. 

All communication with the COMPANY and the REPRESENTATIVE seeking resolution of a dispute must be in writing and sent via U.S. Mail to Liberty Freedom Network. It is within the DRB’s discretion whether a claim is accepted for review.  If the DRB agrees to review the matter, it shall schedule a hearing within ten (10) business days of receipt of the REPRESENTATIVE’S written request.  All evidence (e.g., documents, exhibits, etc.) that a REPRESENTATIVE desires to have considered by the DRB must be submitted to the COMPANY with the written request for a review with the DRB.  The REPRESENTATIVE shall bear all of the expenses related to his or her attendance and the attendance of any witnesses he or she desires to be present at the hearing.  The decision of the DRB will be final and subject to no further review, except as provided in Sections 9.4 and 9.5 below.  During the pendency of the claim before the DRB, the REPRESENTATIVE waives his or her right to pursue arbitration or any other remedy. 

Following issuance of a disciplinary sanction that includes a fine, suspension or termination, the disciplined REPRESENTATIVE may appeal the sanction to the DRB.  REPRESENTATIVE’S appeal must be in writing and received by the COMPANY within fifteen (15) days from the date of the COMPANY’S notice of the disciplinary sanction.  If the appeal is not received by the COMPANY within the fifteen (15) day period, the sanction will be final.  The REPRESENTATIVE must submit all supporting documentation with his or her appeal correspondence.  If the REPRESENTATIVE files a timely appeal of a disciplinary sanction, the DRB will review and reconsider the sanction, consider any other appropriate action, and notify the REPRESENTATIVE in writing of its decision.

9.4 - Mediation

Prior to instituting any arbitration as provided in Section 9.5 below, the parties shall meet in good faith and attempt to resolve any dispute arising from or relating to the AGREEMENT through non-binding mediation.  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 fees and costs at least ten (10) days in advance of the mediation.  Each party shall pay its own attorney fees, costs, and individual expenses associated with conducting and attending the mediation.  Mediation shall be held in Orange County, CA, and shall last no more than two business days.

9.5 - 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 by The Judicial Arbitration and Mediation Services (JAMS) and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.  

REPRESENTATIVE waives all rights to trial by jury or by any court.  All arbitration proceedings shall be held in Orange County, California, unless the laws of the state in which a REPRESENTATIVE resides expressly require the application of its laws, in which case the arbitration shall be held in the capital of that state.  All parties shall be entitled to all discovery rights pursuant to the California Rules of Civil Procedure.  There shall be one arbitrator, an attorney at law, or retired judge, who shall have expertise in business law transactions with a strong preference being an attorney knowledgeable in the direct selling industry, selected from the panel which the JAMS Panel provides.  The prevailing party to the arbitration shall be awarded reasonable costs and expenses of arbitration, including legal/attorney 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.

      Nothing in the AGREEMENT shall prevent the COMPANY 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 the COMPANY’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.  

      Intellectual property and/or trademark infringements are specifically excluded from arbitration.

9.6 - Governing Law, Jurisdiction and Venue

      Jurisdiction and venue of any matter not subject to arbitration shall reside exclusively in Orange County, CA. The Federal Arbitration Act shall govern all matters relating to arbitration.  The laws of the State of California shall govern all other matters relating to or arising from the AGREEMENT.  Notwithstanding the foregoing, and the arbitration provision in Section 9.5, residents of the State of Louisiana shall be entitled to bring an action against the COMPANY in their home forum and pursuant to Louisiana law. 

 

SECTION 10 - PAYMENT

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

A REPRESENTATIVE shall not permit other REPRESENTATIVES or Customers to use his or her credit card, or permit debits to his or her checking accounts, to enroll or to make purchases from the COMPANY.

 

SECTION 11 - INACTIVITY & CANCELLATION

11.1 - Effect of Cancellation

So long as a REPRESENTATIVE remains active and complies with the terms of the REPRESENTATIVE AGREEMENT, the COMPANY shall pay commissions to such REPRESENTATIVE in accordance with the Compensation Plan.  A REPRESENTATIVE’S bonuses and commissions constitute the entire consideration for the REPRESENTATIVE’S efforts in generating sales and all activities related to generating sales (including building a Marketing Organization).  Following a REPRESENTATIVE’S non-renewal of his or her REPRESENTATIVE AGREEMENT, cancellation for inactivity, or voluntary or involuntary cancellation of his or her REPRESENTATIVE AGREEMENT (all of these methods are collectively referred to as “cancellation”), the former REPRESENTATIVE 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 REPRESENTATIVE whose business is cancelled will lose all rights as a REPRESENTATIVE.  This includes the right to sell the COMPANY products and services and the right to receive future commissions, bonuses, or other income resulting from the sales and other activities of the REPRESENTATIVE’S former Marketing Organization.  In the event of cancellation, REPRESENTATIVE agrees to waive all rights they may have, including but not limited to property rights, to their former Marketing Organization and to any bonuses, commissions or other remuneration derived from the sales and other activities of his or her former Marketing Organization.  A REPRESENTATIVE whose REPRESENTATIVE 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).

11.2 - Involuntary Cancellation

A REPRESENTATIVE’S violation of any of the terms of the AGREEMENT, including any amendments that may be made by the COMPANY at its sole discretion, may result in any of the sanctions listed in Section 9, including the involuntary cancellation of his or her REPRESENTATIVE AGREEMENT.  Cancellation shall be effective on the date on which written notice is mailed, emailed, faxed, or delivered to an express courier for delivery to the REPRESENTATIVE’S last known address (or facsimile number).  

11.3 - Voluntary Cancellation

A REPRESENTATIVE in this business has a right to cancel their own business at any time, regardless of reason.  Cancellation must be made by contacting Liberty Freedom Network.

 

SECTION 12 – GLOSSARY OF TERMS

 ACTIVATED BUSINESS CENTER - Any Business Center that has been activated by either the "Fast Start Activation Pack" way or the regular way as explained in the Liberty Freedom Network Retail Sales Compensation Plan Brochure.

ACTIVE CUSTOMER — A Customer who purchases the products or services on-line through one or more of the COMPANY’S merchants by or through a REPRESENTATIVE’S Website

ACTIVE REPRESENTATIVE – In this document, an active Representative is an Independent Representative with the COMPANY, who has completed a REPRESENTATIVE Application and AGREEMENT, has been accepted by the COMPANY’S home office and who has received a commission, bonus or cash back during the preceding twelve (12) months.

AGREEMENT – The contract between the COMPANY and each REPRESENTATIVE includes the REPRESENTATIVE Application and AGREEMENT, the COMPANY Policies and Procedures, the COMPANY Compensation Plan, and the Business Entity Registration Form (where appropriate), all in their current form and as amended by the COMPANY at its sole discretion.  These documents are collectively referred to as the “AGREEMENT.”

BUSINESS CENTER - When an IR has applied and been accepted by Liberty Freedom Network, he is given, without charge, (7) seven business centers, grouped together and known as the 7 Steps to Liberty. Each business center is its own distinct "pay center" and can earn commissions in the Liberty Freedom Network Retail Sales Compensation Plan.

Cancel – The termination of a REPRESENTATIVE’S business.  Cancellation may be either voluntary, involuntary, through non-renewal.

Commission History – The commissionable value of the COMPANY’S products and services sold by a REPRESENTATIVE’S Marketing Organization. 

Commissions and Bonuses – All compensation paid to a qualified REPRESENTATIVE

Compensation Plan – The plans offered by the COMPANY which set forth the compensation provided to REPRESENTATIVE for sales of product, continued building, promoting, motivation, servicing, and development of their independent business.

Customer – A person or entity that purchases product from a merchant through a web “store” for personal consumption or directly from a Liberty Freedom Network Independent Representative.

Genealogy Report – Available in REPRESENTATIVE’S Virtual Office, it is a report generated by the COMPANY that provides critical data relating to the identities of REPRESENTATIVE, sales information, and enrollment activity of each REPRESENTATIVE’S Marketing Organization.  This report is updated in real time, and contains confidential and trade secret information which is proprietary to the COMPANY. 

ID NUMBER/ – The identification number or TRACKING ID NUMBER assigned to a REPRESENTATIVE by the COMPANY for all company identification purposes.

INDEPENDENT REPRESSENTATIVE -  An IR is any person or legal entity who has completed a Liberty Freedom Network Application/Agreement form and been accepted by Liberty Freedom Network. The Independent Representative Application and Agreement is considered an authentic and binding legal document. An IR agrees to adhere to and follow Liberty Freedom Network’s Policies and Procedures. All IRs are Independent Contractors.

Marketing Organization – The Customers and REPRESENTATIVES referred below a particular REPRESENTATIVE.

Official Material – Literature, audio or video tapes, disks, and other materials developed, printed, published and distributed by the COMPANY to REPRESENTATIVE.

Preferred Customer – A person or entity that purchases product from a merchant through a WO’s web “store” for personal consumption, but who also provides personal contact information to the IR to receive updates on shopping, sales and specials

QUALIFIED IR- An IR who is qualified to receive points from their down-line. An IR becomes qualified by personally purchasing 400 regular order points or 200 points when on auto-ship, within a month of any down-line points earned. If this time limit is not met, the down-line points will start accumulating when the required points are purchased and payment is approved.

REFER  – For purposes of the COMPANY’S Conflict of Interest Policy (Section 3.22), the term “refer” means: (a) The actual or attempted solicitation, referral, enrollment, encouragement, or effort to influence in any other way, either directly, indirectly, or through a third party, another person or customer to enroll or participate in another multilevel marketing, network marketing or direct sales opportunity; and (b) The conduct described in (a) above constitutes referring even if the REPRESENTATIVE’S actions are in response to an inquiry by another REPRESENTATIVE or Customer.  This subsection (b) shall not be applicable in California.

REFERRER – A REPRESENTATIVE who refers a Customer or another REPRESENTATIVE into the COMPANY, and is listed as the Referrer on the REPRESENTATIVE Application and AGREEMENT.  The act of referring others and training them to become REPRESENTATIVE is called “referring.”

RETAIL SALES COMPENSATION PLAN - The compensation Plan that governs the commissions, bonuses and other payments from Liberty Freedom Network to an IR as set forth in the Liberty Freedom Network Retail Sales Compensation Plan Brochure.

SPONSOR - An IR who has signed up another person that has completed an Application and Agreement. Sponsor infers a responsibility to perform as a leader and trainer to each IR personally sponsored.

Upline – This term refers to the REPRESENTATIVE above a particular REPRESENTATIVE in a referral line up to the COMPANY.  Conversely stated, it is the line of refers that links any particular REPRESENTATIVE to the COMPANY.

SECTION 13 - REPRESENTATIVE Terms and Conditions

 

13.1 - Terms and Conditions: 

The undersigned hereby represents, warrants, covenants and agrees with the COMPANY, as follows: 

a)       The undersigned REPRESENTATIVE is of legal age in the state of REPRESENTATIVE’S residency.  REPRESENTATIVE agrees that they are an independent contractor of the COMPANY responsible for determining his or her own business activities without control or direction by the COMPANY.  REPRESENTATIVE is not an agent, employee or legal representative of the COMPANY. REPRESENTATIVE acknowledges and agrees that REPRESENTATIVE has no authority to enter into agreements of any kind on behalf of the COMPANY, or otherwise bind or obligate the COMPANY in any manner to any third party, by virtue of the relationship contemplated by the AGREEMENT or otherwise.  REPRESENTATIVE is responsible for the payment of all federal, state and self employment taxes and any other tax required under any federal, state or taxing agency, and without limiting the generality of the foregoing, REPRESENTATIVE acknowledges and agrees that REPRESENTATIVE will not be treated as an employee of the COMPANY for federal or state tax purposes.  REPRESENTATIVE is not an employee of the COMPANY and is not entitled to workers’ compensation, unemployment benefits or any other employee type benefit from the COMPANY or by virtue of his or her REPRESENTATIVE status with the COMPANY.  REPRESENTATIVE hereby represents and warrants to the COMPANY that (i) REPRESENTATIVE has no obligations to or relationships with other parties that would (a) present a conflict with carrying out the duties under the AGREEMENT, (b) prevent REPRESENTATIVE from carrying out the duties under the AGREEMENT, or (c) present a significant potential for disclosure of information to the COMPANY that is not publicly known and that REPRESENTATIVE is obligated to a third party to keep confidential, (ii) REPRESENTATIVE’S execution and performance of the AGREEMENT do not and will not violate the legal or contractual rights of any third party, (iii) REPRESENTATIVE has the power and authority to execute, deliver and perform the AGREEMENT and (iv) all information and materials submitted to the COMPANY are true and correct, including but not limited to REPRESENTATIVE’S Social Security Number and/or Federal Employee Identification Number. 

b)       REPRESENTATIVE acknowledges and agrees that REPRESENTATIVES are not guaranteed any commissions, bonuses or other income, profit or success by virtue of REPRESENTATIVE’S position with the COMPANY, and REPRESENTATIVE hereby certifies that no such representations or warranties have been made to REPRESENTATIVE. 

c)       In presenting the COMPANY business to prospects, REPRESENTATIVE agrees that such presentations shall be made strictly according to the AGREEMENT and that REPRESENTATIVE may be suspended or terminated if REPRESENTATIVE fails to so comply. 

d)       REPRESENTATIVE agrees that in order to maintain a viable marketing program and to comply with changes in federal, state and local laws and economic conditions, the COMPANY may modify, change or amend these Terms and Conditions, the Policies and Procedures and the REPRESENTATIVE Compensation Plan in the COMPANY’s sole and absolute discretion.  The REPRESENTATIVE Compensation Plan is incorporated herein by reference.  Such additions and modifications become a binding part of the AGREEMENT upon publication in the official REPRESENTATIVE Virtual Office “Downloads” section on the COMPANY’s website, or by email or other written notification to REPRESENTATIVE.

e)       REPRESENTATIVE understands that no attorney general or other regulatory authority ever reviews, endorses or approves any direct selling product, compensation plan or company, and REPRESENTATIVE will make no such claim as regards to the COMPANY or its product or services.

f)        The AGREEMENT shall be deemed in effect upon receipt and acceptance by the COMPANY at its home office in Orange County, CA. and will remain in full force and effect for a period of one year thereafter.  Following the initial term, the AGREEMENT may be renewed for successive one year periods each, unless otherwise earlier terminated in accordance herewith.  REPRESENTATIVE ACKNOWLEDGES THAT REPRESENTATIVE IS FREE TO TERMINATE THE AGREEMENT AT ANY TIME FOR ANY REASON.  The COMPANY may terminate the AGREEMENT immediately upon written notice in the event REPRESENTATIVE breaches the AGREEMENT.   Immediately upon termination or non-renewal of the AGREEMENT, REPRESENTATIVE shall (i) lose all rights to purchase products and/or services from the COMPANY, (ii) cease from representing himself or herself as a REPRESENTATIVE, (iii) lose all rights to REPRESENTATIVE’S participation and position in the Compensation Plan, including all future commissions, cash back and earnings resulting therefrom and (iv) take all other actions reasonably required by the COMPANY, including the discontinuance of the COMPANY’s names, marks and other intellectual property. 

g)       REPRESENTATIVE acknowledges and agrees that the COMPANY and its affiliates have the exclusive proprietary interest in and to its REPRESENTATIVES and customer lists and names, customer information developed by or for the COMPANY such as credit data, product and service purchase information and customer profile data, manufacturing procedures, formulas, source and object codes, product development and in all operating, financial and marketing materials, and that all such information is confidential.  REPRESENTATIVE shall not use or disclose such information to any third party except in strict accordance with the AGREEMENT.  REPRESENTATIVE understands that all confidential information will be disclosed to REPRESENTATIVE on a “need to know” basis solely for use in his or her REPRESENTATIVE business.  REPRESENTATIVE agrees to use his or her best efforts to keep such information confidential and shall not use such information to sell products or services other than the COMPANY’s products and services or in connection with any other business during the term of and after termination of the AGREEMENT.  Upon termination or expiration of the AGREEMENT, REPRESENTATIVE immediately will cease all use of the COMPANY’s trademarks, service marks and confidential and proprietary information and, if requested by the COMPANY, return all such materials in REPRESENTATIVE’S possession to the COMPANY or destroy such materials with certification thereof to the COMPANY. 

h)       REPRESENTATIVE shall indemnify and hold harmless the COMPANY, its parents, subsidiaries and affiliates, and their shareholders, officers, agents, employees and directors, from and against any and all claims, demands, liabilities, losses, damages, costs or expenses, including but not limited to, court costs and attorneys’ fees, asserted against, or suffered or incurred by, any of them by reason of, arising out of, resulting from or in any way connected with, directly or indirectly, REPRESENTATIVE’S (i) activities as a REPRESENTATIVE, including without limitation, any unauthorized representations made by the REPRESENTATIVE, (ii) breach of the terms of the AGREEMENT or (iii) violation of or failure to comply with any applicable federal, state or local law or regulation, in each case whether or not litigation is commenced.  The COMPANY shall have the right to offset any amounts owed to the REPRESENTATIVE hereunder against the amount of any commissions, bonuses or other amounts owed to the REPRESENTATIVE from the COMPANY.

i)         REPRESENTATIVE may only pay for REPRESENTATIVE’S own fees.  

j)        REPRESENTATIVE agrees the following activities are prohibited and may not be undertaken directly or indirectly by the REPRESENTATIVE:

·         The display, offer or sale of non-COMPANY provided products; services or business positions in connection with any COMPANY related event or REPRESENTATIVE activity.

·         Except as otherwise set forth in the AGREEMENT, offering or selling any product, material, or service to any current REPRESENTATIVE or CUSTOMER.

·         Offering to pay or paying for the REPRESENTATIVE position of another person in whole or in part as a means of inducing that person to become or remain a REPRESENTATIVE.

·         The initiation, participation in or recommendation of any prize offering, guarantee, drawing, raffle, advertising pool or co-op in furtherance of REPRESENTATIVE’S own or another person’s business, except as otherwise set forth in the Policies and Procedures.  

k)       Commissions are payable to REPRESENTATIVE according to the AGREEMENT and the COMPANY REPRESENTATIVE Compensation Plan.

l)         As an inducement for the COMPANY to enter into the AGREEMENT and in consideration of the mutual covenants herein contained, REPRESENTATIVE agrees that during the term of the AGREEMENT and for a period of one year thereafter, REPRESENTATIVE shall not, directly or indirectly, on the REPRESENTATIVE’S own behalf or on the behalf of any other person or entity, solicit, induce or hire or attempt to solicit, induce or hire any REPRESENTATIVE, distributor, employee, member, customer, supplier or merchant of the COMPANY (i) to enter into any business relationship with any other direct sales or network marketing company or (ii) to terminate or alter his or her business or contractual relationship with the COMPANY.  In addition, REPRESENTATIVE agrees that during the term of the AGREEMENT, REPRESENTATIVE shall not, directly or indirectly, on REPRESENTATIVE’S own behalf or on the behalf of any other person or entity, engage in selling on-line shopping related products on behalf of another network marketing or direct sales company.

m)     REPRESENTATIVE consents to and authorizes the COMPANY to initiate ongoing e-mail communications to REPRESENTATIVE’S e-mail address, and agrees to inform the REPRESENTATIVE’S e-mail carrier of this authorization when requested to do so by the COMPANY.

n)       The AGREEMENT is governed by the laws of the State of California without regard to its choice or conflict of laws rules.  REPRESENTATIVE will abide by all applicable federal, state and local laws or regulations, and the terms of these Terms and Conditions, the Policies and Procedures and the Compensation Plan.

o)       REPRESENTATIVE HEREBY ACKNOWLEDGES AND AGREES THAT IN NO EVENT WILL THE COMPANY OR ANY OF ITS AFFILIATED COMPANIES BE LIABLE UNDER THE AGREEMENT, UNDER ANY THEORY OF LIABILITY, FOR ANY INDIRECT, SPECIAL, CONSEQUENTIAL, INCIDENTAL, PUNITIVE OR SIMILAR DAMAGES, EVEN IF THE COMPANY HAS BEEN ADVISED OF THE POSSIBILITY THEREOF. 

p)       REPRESENTATIVE agrees that upon breach of the AGREEMENT that the COMPANY will be immediately and irreparably harmed and cannot be made whole solely by monetary damages.  REPRESENTATIVE agrees that the remedy at law for any breach of any provision of these Terms and Conditions shall be inadequate and that, in addition to any other remedies at law or in equity that it may have.  The COMPANY shall be entitled, without the necessity of proving actual damages or posting bond, to temporary or permanent injunctive relief to prevent the breach of any provision of the AGREEMENT and/or to compel specific performance of the AGREEMENT. 

q)       The COMPANY shall be entitled to its costs and expenses, including reasonable attorneys’ fees, in enforcing its rights under the AGREEMENT. 

r)        If under any applicable law or rule of any applicable jurisdiction, any provision of the AGREEMENT is held to be invalid or unenforceable, the remainder of the AGREEMENT will be interpreted as best to effect the intent of the parties hereto.  The remaining provisions of the AGREEMENT shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from the AGREEMENT.  In addition to any other provisions set forth in the Policies and Procedures that survive termination or expiration of the AGREEMENT, the provisions of Section 13, § (a), (h), (i), (m), (o), (p), (q), and (s) shall survive termination or expiration of the AGREEMENT. 

s)        The COMPANY uses E-Signatures in accordance with 15 U.S.C. §7001 Electronic Signatures in Global and National Commerce Act (the “ESIGN”) to facilitate the use of electronic records and signatures by ensuring the validity and legal effect of this AGREEMENT.

t)        The AGREEMENT constitutes the entire agreement between the REPRESENTATIVE and COMPANY, supersedes all prior agreements and no other promises, representations, guarantees or agreements of any kind shall be valid unless in writing and signed by both parties.

 

     
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