2017 POLICIES AND PROCEDURESdownloads.jafrausa.com/pdfs/en/2017/nov/171113... · 4.4 Income Claims...

2017 POLICIES AND PROCEDURES

P O L I C I E S A N D P R E C E D U R E S2

Section 1: Introduction 61.1 Our Agreement 61.2 Changes To Our Agreement 61.3 Contacting JAFRA 6

Section 2: Enrolling As a JAFRA Independent Consultant 6

2.1 Requirements To Become A JAFRA Independent Consultant 62.2 Consultant ID Number 7

Section 3: Consultant Status And Account 73.1 Only One Account Per Person 73.2 Maximum Of Five Accounts Per Address 73.3 Changing Your Account Information (Name, Address, Etc.) • 3.3.1 Name Changes 7 • 3.3.2 Birth Date Changes And Social Security Number Changes 7 • 3.3.3 Change Of Addresses And Phone Number 7

Section 4: Consultant Rights & Responsibilities 7

4.1 Consultant Benefits 74.2 Independent Contractor Status 84.3 No Discrimination 84.4 Income Claims 84.5 Code Of Ethics 84.6 Deceptive, Fraudulent, And Illegal Activities Prohibited 94.7 Exclusive Use Of JAFRA’s Contract And Sales Forms 94.8 Account Manipulation Prohibited 94.9 Inventory Loading Prohibited 94.10 Actions Of Household Members 104.11 Conflicts Of Interest 104.12 Reporting Policy Violations Or Improper Activity 104.13 Inventory Buyback Following Termination Of Agreement 104.14 Business Kit Buyback 10

Section 5: Operating Your JAFRA Business 11

5.1 Consultant Maintenance Requirement 115.2 No Exclusive Territories 115.3 Location Of Your JAFRA Business 115.4 Operating Your JAFRA Business Through A Business Entity 115.5 Acting On Behalf Of Another Consultant Or Combining Orders 115.6 Transfer Of Sales 115.7 Transfer Or Assignment Of Business 115.8 Reporting 115.9 Business License 125.10 Client Referral Lead Program 125.11 IRS Form 1099 125.12 Requests For Records 12

TABLE OF CONTENTS

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Section 6: Purchase And Sale Of Products 126.1 Selling Products To Clients 12 • 6.1.1 Authorized Channel Of Distribution 12 • 6.1.2 Product Sales To Non-Consultants For Resale 12 • 6.1.3 Documenting Sales To The End-Consumer 13 • 6.1.4 Sales Outside Of Channel Of Distribution 13 • 6.1.5 Product Re-Packaging And Re-Sale Of Samples Prohibitied 13 • 6.1.6 Customer Service 13 • 6.1.7 Client Order Form 13 • 6.1.8 Sales Receipts 13 • 6.1.9 Three-Day Cancellation Period For Client Sales 136.2 Ordering Product From JAFRA 14 • 6.2.1 Paying Your Order/Account 14 • 6.2.2 Paying By Check 14 • 6.2.3 Shipping & Handling 14 • 6.2.4 Sales Tax 14 • 6.2.5 Gifts 14 • 6.2.6 Price And Product Availability 14 • 6.2.7 Correct And Prompt Orders 14 • 6.2.8 Timing Of Orders For Monthly Commissions Or Incentives 15 • 6.2.9 Product Quantities Over 50 15 • 6.2.10 Product/Order Not Received 15 • 6.2.11 Inspection Of Delivered Products 15 • 6.2.12 Storage And Handling Of Products 156.3 Changes To Orders 15 • 6.3.1 Product Add-Ons 15 • 6.3.2 Address Corrections/Change Of Shipping Address 16 • 6.3.3 Cancelling Product Orders 166.4 Product Availablity 16 • 6.4.1 Temporarily Unavailable Products 16 • 6.4.2 Product Availability Report 166.5 Returns/Replacements/Exchanges 16 • 6.5.1 Damaged Or Defective Products (Consultants) 16 • 6.5.2 Product Replacement & Exchanges (Clients) 176.6 JAFRA Credit Program; Paying Your Account 17 • 6.6.1 Applying For Credit; Requirements To Receive Credit 17 • 6.6.2 Orders Placed With Credit 18 • 6.6.3 Balances Payment; Late Fees 18 • 6.6.4 Accounts Sent To Collection (Bad Debt) 186.7 Pre-Pay Status 18

Section 7: Promoting JAFRA Products And Your Business 18

7.1 Promoting Your Affiliation With JAFRA 18 • 7.1.1 Telephone & Voicemail Greeting 197.2 Trademarks, Copyrights, And Domain Names 19 • 7.2.1 Trademark License Grant 19 • 7.2.2 Prohibited Actions 19 • 7.2.3 Documenting Use Of Marks 20 • 7.2.4 Actions In JAFRA’s Best Interests 20 • 7.2.5 Domain Names 20


• 7.2.6 Use Of JAFRA’s Copyrights 20 • 7.2.7 Use Of JAFRA Logo 207.3 Promoting JAFRA Products And Opportunity 20 • 7.3.1 Implying Employment Prohibited 20 • 7.3.2 Product & Testimonial Claims 20 • 7.3.3 Promotional Materials/ Merchandise 21 • 7.3.4 Marketing Events 21 • 7.3.5 Product Pricing And Promotion Guidelines 21 • 7.3.6 Media Promotion 21 • 7.3.7 Phone, Email, And Mass Media Solicitation 21 • 7.3.8 “Before and After” Photos 22 • 7.3.9 Facials and Demonstration Policy 22 • 7.3.10 Promoting JAFRA at booths or fixed locations 227.4 Advertising 23 • 7.4.1 Online Classifieds 23 • 7.4.2 Banner Advertising 23 • 7.4.3 Search Engines, Sponosored Links, And Pay-Per-Click Ads 23 • 7.4.4 Spam Linking 24 • 7.4.5 Affiliate Programs 247.5 Personal JAFRA Websites 247.6 Linking Policy 247.7 External JAFRA Websites 247.8 Social Media 24 • 7.8.1 JAFRA’s Social Media Sites 24 • 7.8.2 General Social Media Policies 257.9 Violations Of Policy 27

Section 8: Sponsoring And Leadership 27

8.1 Leadership Qualifications 278.2 Leaders’ Obligations 278.3 Lineage Support 278.4 Training On Products, Sales, And Compensation 278.5 Training On Policies 278.6 Charging For Training Events And Materials 278.7 Change Of Sponsor 27

Section 9: Confidential And Private Information 289.1 Respecting Your Privacy 289.2 Protecting Client Information 289.3 Protecting JAFRA’s Information 289.4 Website Privacy Policies 28

Section 10: Compensation, Incentives, Recognition, & Travel 2810.1 Compensation Structure 2810.2 No Cash Advances 2810.3 Non-Commissionable Items 2810.4 Gifts/Rewards –Shipment And Taxes 2810.5 Travel And Events 28 • 10.5.1 Limitation Of Liability 28 • 10.5.2 Auditing 28

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• 10.5.3 Tax On Trip Value 28 • 10.5.4 Photo Policy 29 • 10.5.5 Consultant Status 29 • 10.5.6 Additional Travelers 29 • 10.5.7 No Cash Value 29 • 10.5.8 Force Majure 29 • 10.5.9 On-Site Registration 29

Section 11: Inactivity, Suspension, Holds, And Ending This Agreement 2911.1 Ending This Agreement 2911.2 Violations Of This Agreement 2911.3 Re-Enrollment 2911.4 Leave Of Absence Request At The Branch Level 2911.5 Manager Re-Qualifications 3011.6 Hold Status 30

Attached Documents (Appendices)

March 2016

Compensation Plan

Code of Ethics

Appendix A: Compensation Plan Appendix B: Dsa Code Of Ethics


Section 1: Introduction

1.1 OUR AGREEMENTYour Independent Consultant Agreement includes (a) the terms and conditions listed on the Independent Consultant Agreement that you signed when you enrolled with JAFRA, and (b) this document—the JAFRA Independent Consultant Polices & Procedures (“Policies & Procedures”). We will refer collectively to these two documents as “the Agreement” or “our Agreement.” At the end of this document (the Policies & Procedures), you will find the Compensation Plan (Appendix A), which describes the ways in which you may be paid for your Consultant activities.

When the terms “JAFRA”, “we”, or “our” are used in the Agreement, it means JAFRA Cosmetics International. When the terms “you” or “your” or “Consultant” are used, we are referring to you and our other JAFRA independent Consultants, including JAFRA leaders.

You must follow all of the requirements in the Independent Consultant Agreement, including in these Policies & Procedures. Because you may be unfamiliar with many of these requirements, it is very important that you read and follow these Policies & Procedures. Please review the information in this document carefully. It explains and governs the relationship between you, as an independent contractor, and JAFRA. If you have any questions regarding any policy or procedures, please contact JAFRA. JAFRA strives to educate its Consultants on the requirements of the Agreement and to work collaboratively with its Consultants to work through any issues. However, if you violate our Agreement, JAFRA has the right to suspend or terminate your account. Thus, JAFRA encourages you to ask questions or seek guidance on our Agreement in order to prevent or promptly correct any violations.

1.2 CHANGES TO OUR AGREEMENTJAFRA reserves the right to change the Agreement, including the Policies & Procedures and Compensation Plan, in its sole and

Welcome to JAFRA! You have joined an empowered and talented group of people from around the world who love JAFRA products and love sharing those products with others. This document, the “Policies & Procedures”, is intended to do several things. First, it sets out the “rules of road” for your independent JAFRA business—it defines the relationship between you and JAFRA and sets standards for acceptable business conduct. Second, this document is a “guide book” that will answer questions about how to run your business, place orders, and get paid, among other things.

absolute discretion. Among other reasons, such changes may occur because of changes in federal, state, or local laws or changes in the business environment. By entering into the Agreement, you agree to abide by the Agreement including all changes that JAFRA chooses to make. Any of these changes will be effective upon posting such changes or updated documents on “www.jafrabiz.com”.

The most current version of our Agreement, including the Policies & Procedures, will be posted on “www.jafrabiz.com”. It is your responsibility to check for the most current version of the Policies & Procedures, and read it, understand it, and follow it.

Your continuation of your JAFRA business or your acceptance of compensation or incentives from JAFRA constitutes acceptance of any and all amendments to our Agreement.

1.3 CONTACTING JAFRAIf you have any questions, comments, or concerns, please contact us by phone (1-800-852-3728), email ([email protected]), chat (“www.jafrabiz.com”), or by mail at 2451 Townsgate Rd, Westlake Village, California 91361. Our Customer Relationships Team (“CRT”) is here to help!

Section 2: Enrolling as a JAFRA Independent Consultant

2.1 REQUIREMENTS TO BECOME A JAFRA INDEPENDENT CONSULTANTTo qualify to become a Consultant, you must be 18 years or older, live in the United States or Puerto Rico; be a United States citizen or permanent resident, and possess a valid Social Security number or Tax Identification number.

JAFRA INDEPENDENT CONSULTANT POLICIES & PROCEDURES

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To enroll as a Consultant, you must fill out, read, and sign the Independent Consultant Agreement, with valid, true, and complete information. You are not permitted to list another person’s phone number or address on the Agreement. You must personally sign and submit the agreement. No other person, including your sponsor, may sign or submit an online application on your behalf. JAFRA reserves the right to refuse to enroll any person as a Consultant at its sole discretion.

When you enroll as a new Consultant, you will be sponsored by a current Consultant. If you do not identify a sponsor on your application, JAFRA will assign you one at its discretion.

Your Independent Consultant Agreement, and accompanying order(s), if applicable, must be submitted by 11:59pm Pacific Time on the last day of the month to count as a new Consultant during the current month. New Independent Consultant Agreements arriving at JAFRA after the due date above will be processed the following month.

2.2 CONSULTANT ID NUMBERUpon joining JAFRA, each Consultant is assigned an individualized Consultant identification number (“Consultant ID Number”). This Consultant ID Number is used to identify Consultants and their accounts. Please submit your Consultant ID Number on all correspondence and payments. You will also use your Consultant ID Number to access “www.JAFRAbiz.com”.

Section 3: Consultant Status and Account

3.1 ONLY ONE ACCOUNT PER PERSONYou may only have one open JAFRA account anywhere in the world. This means you may only have one JAFRA Consultant ID Number at any time and in any location, including in any other country in the world. JAFRA will terminate any duplicate account. The first account that you created will remain open and JAFRA will terminate all other subsequent accounts.

You may not alter any account/contact information (i.e. name, address, birth date or social security number) in any way to create an additional Consultant account.

Only one person may be listed on a JAFRA account. Co-applicants for a JAFRA account are not permitted.

3.2 MAXIMUM OF FIVE ACCOUNTS PER ADDRESS There may be no more than five Consultants per mailing address, unless you have written permission from JAFRA and so long as

the following criteria are satisfied: • No one under the age of 18 may be a Consultant • Each Consultant must be a real person using their own JAFRA account in accordance with this Agreement. If more than five people at your address wish to enroll as Consultants, you must contact and follow JAFRA’s instructions for verifying the additional Consultants.

3.3 CHANGING YOUR ACCOUNT INFORMATION (NAME, ADDRESS, ETC.)You may request to change your own account information. You may not request to change any other Consultant’s information, and no other Consultant may request changes to your account information.

3.3.1 Name changes To request name changes, please call JAFRA’s Customer Relationships Team. You will be required to provide photo identification verifying your name before your name change can be processed. You must also be able to verify the following before JAFRA will process your name change: (1) Your name and Consultant ID Number, (2) your mailing address, phone number, and email address, and (3) your date of birth.

3.3.2 Birth date changes and social security number changes If you need to change the birth date or social security number associated with your account, please call JAFRA’s Customer Relationships Team. You will be required to provide verification of your birth date and social security number. You will also be required to fill out and sign a new Consultant agreement.

3.3.3 Change of addresses and phone number To ensure timely delivery of products, support materials, and commission checks, it is important that JAFRA has your current contact information. If you plan to move, please call JAFRA to update your address and phone number. Verification of your new address is not required.

Section 4: Consultant Rights & Responsibilities

4.1 CONSULTANT BENEFITSOnce JAFRA accepts your Independent Consultant Agreement and assigns you a Consultant ID number, the benefits of this Agreement, including the Compensation Plan, are available to you. These benefits include the right to:

JAFRA INDEPENDENT CONSULTANT POLICIES & PROCEDURES


• Market and sell JAFRA products to the end-consumer. (The end-consumer is the client who uses the product) • Participate in the Compensation Plan • Sponsor other individuals as JAFRA Consultants and build a marketing organization • Participate in JAFRA-sponsored support, service, training, and motivational and recognition events • Participate in promotional and incentive contests and programs sponsored by JAFRA for its Consultants

4.2 INDEPENDENT CONTRACTOR STATUSAs a Consultant, you are an independent contractor. Your Agreement with JAFRA does not create an employer/employee relationship, agency, partnership, associate, agent or joint venture between JAFRA and you. You are solely responsible for, among other things: • Determining when, where and how you will carry out your activities as a Consultant; • Paying all costs incurred with respect to your activities as a Consultant, including but not limited to travel, food, lodging, telephone carriers/services, business supplies, sales tools and any all other business related expenses; • Setting your own goals, hours and methods of sale, subject to this Agreement and applicable law; • Filing the appropriate documents for and paying federal, state and local taxes due from all compensation earned as a Consultant.

JAFRA will not withhold amounts or make payments for social security, unemployment insurance, disability insurance contributions, or workers compensation on your behalf. JAFRA will not withhold or deduct taxes of any kind from bonuses or commissions, unless withholding becomes legally required. You will not be treated as an employee with respect to the Internal Revenue Code, Social Security Act, Federal Unemployment Act, state unemployment acts or any other federal, state or local statute, ordinance, rule or regulation.

4.3 NO DISCRIMINATION The JAFRA opportunity is available to everyone regardless of race, gender, nationality, sexual orientation, physical abilities or limitations, religion, or political beliefs. You shall not present the JAFRA opportunity as anything other than an opportunity available to anyone.

4.4 INCOME CLAIMSThe Federal Trade Commission and certain states have laws that prohibit certain types of income claims and testimonials by people engaged in direct selling/multi-level marketing. While you may believe it beneficial to tell other Consultants and potential Consultants about your earnings or the earnings of others, such claims may have legal consequences and may negatively impact both you and JAFRA.

When discussing the JAFRA opportunity, you should present the opportunity fairly, honestly, and enthusiastically without making misrepresentations. This means you must give other Consultants or potential Consultants a realistic view of what an average person can reasonably expect to earn as a JAFRA Consultant and of the time and effort involved.

You should not make statements of potential or guaranteed income or benefits in connection with JAFRA opportunity unless such statements have been promoted by, provided by, or approved by JAFRA. You should not make any projections, claims or estimates regarding your or other Consultants/leaders actual or potential income from JAFRA. Lifestyle claims that imply meaningful earnings from the JAFRA opportunity are also prohibited. For example, among other things, you cannot say things like “my JAFRA business allowed me to buy a house, quit my other job, take a luxury vacation, pay off my debt”, etc.

4.5 CODE OF ETHICSAs a JAFRA Independent Consultant, I agree that I will:

1. AVOID MAKING INCOME CLAIMS: I will not make claims of potential or guaranteed income in connection with the JAFRA opportunity. I will familiarize myself with JAFRA’s Compensation Plan and represent it to clients, other Consultants, and prospective Consultants realistically, so as not to mislead or provide false expectations. I will remind each potential new Consultant that each individual’s success is based on individual efforts. I will only make claims, representations, or statements about JAFRA’s earning opportunity that are included in JAFRA’s official materials.

2. MAKE ACCURATE PRODUCT CLAIMS: I will only make the product claims set out in JAFRA’s materials, without adding to or withholding information from those claims. In order to ensure that customers receive only accurate and helpful product information, I will regularly take action to ensure that the JAFRA literature, materials and product information in my possession are the most current versions distributed by JAFRA. I will educate myself on the full line of JAFRA products so that I can provide customers with individual guidance on which products are best suited for their needs and the proper usage of the same.

3. SELL PRODUCTS ONLY THROUGH APPROVED CHANNELS OF DISTRIBUTION: If I sell products online, I will only do so through my JAFRA Personal Website, and not through eBay, Amazon, or any other online marketplace. When selling products in person, I will not sell products at swap

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meets, farmers markets, or other types of retail situations. I will follow JAFRA’s guidelines for selling products.

4. ETHICALLY FOLLOW THE BUSINESS MODEL: I will not advise or encourage excessive buying at unrealistic levels. I will not inventory load or engage in the following activities to manipulate my JAFRA account (“Account Manipulation”): (a) enroll individuals without their knowledge; (b) fraudulently enroll individuals as Consultants or customers; (c) enroll nonexistent individuals as Consultants or customers; (d) purchase JAFRA products on behalf of another Consultant or customer, or under another Consultant’s or customer’s log-in or I.D. number; or (e) use any other activity to qualify for advancement, incentives, prizes, commissions, or bonuses that is not driven by real product purchases by end-user consumers or real enrollment of interested individuals as Consultants.

5. RESPECT INTELLECTUAL PROPERTY AND CONFIDENTAL INFORMATION: I will not infringe, misappropriate, or misuse JAFRA’s trademarks, copyrights, or other intellectual property. Among other things, I will not use “JAFRA” ” or any of JAFRA’s trademarks or product names in a website domain name. I will protect and keep confidential any client information that I receive, including credit card information. I will not store my client’s confidential information, including credit card information.

6. SERVE MY CLIENTS: I will offer my clients the highest level of service, offering prompt assistance with any necessary product exchanges and/or refunds.

7. DOCUMENT MY SALES: I will keep track of my retail sales using client order forms, sales receipts, and other methods and documents provided by JAFRA.

8. ABIDE BY DSA POLICIES: I will read and follow the Direct Selling Association’s Code of Ethics, available at http://www.dsa.org/consumerprotection/code-of-ethics. (Appendix B to JAFRA’s Policies & Procedures). In the event that an issue arises and JAFRA is contacted by the DSA, I will participate and cooperate in any investigation or dispute resolution.

9. ACT ETHICALLY AND HONESTLY: I will conduct myself ethically and with integrity. At all times, I will present myself and the JAFRA opportunity with honesty and integrity, without misrepresentation. I will uphold the values of JAFRA and not engage in any deceptive, unlawful, or unethical behavior that may be detrimental or reflect poorly on JAFRA, my fellow Consultants, or myself. I will treat my business like any other prestigious enterprise and will fulfill commitments I make to my clients, fellow JAFRA Consultants, and to JAFRA.

10. COMMUNICATE AND ASK QUESTIONS: If I have a question or concern about JAFRA’s Code of Ethics or Policies & Procedures, I will talk to my Ambassador or I will contact JAFRA’s Compliance Department at [email protected].

4.6 DECEPTIVE, FRAUDULENT, AND ILLEGAL ACTIVITIES PROHIBITEDYou must not engage in deceptive, fraudulent, or illegal activity in conjunction with your JAFRA independent Consultant activities. You must conduct yourself so that your activities outside of your JAFRA Consultant activities do not affect your Consultant activities or JAFRA’s reputation.

4.7 EXCLUSIVE USE OF JAFRA’S CONTRACT AND SALES FORMSWhen acting as a JAFRA independent Consultant, you may not use any contracts or forms that JAFRA does not publish. For example, among other things, you may not use a different contract other than JAFRA’s official Independent Consultant Agreement when recruiting or enrolling new Consultants.

4.8 ACCOUNT MANIPULATION PROHIBITEDAccount Manipulation” is strictly and absolutely prohibited. “Account Manipulation” is defined as: (a) the enrollment of individuals or entities without the permission and/or knowledge of such individuals or entities; (b) the fraudulent enrollment of an individual or entity as a Consultant or customer; (c) the enrollment or attempted enrollment of nonexistent individuals or entities as Consultants or customers (“phantoms”); (d) purchasing JAFRA products or services on behalf of another Consultant or customer, or under another Consultant’s or customer’s log-in or I.D. number; or (e) any other activity to qualify for rank advancement, incentives, prizes, commissions, recognition or bonuses that is not driven by real product purchases by end-consumers.

Upon the discovery of any Account Manipulation, you may face, at a minimum, the following consequences: • You will no longer be eligible to receive the reward (incentive or rank advancement) that you earned or attempted to earn via Account Manipulation • Your JAFRA Agreement and account may be terminated

4.9 INVENTORY LOADING PROHIBITEDInventory loading is not permitted. JAFRA supports conducting a healthy business with no product inventory. Purchasing additional product is in no way a requirement or an assurance that your business will do better. JAFRA reserves the right to refuse large orders if a Consultant cannot demonstrate the quantity of product ordered is supported by purchases by end-consumers.


4.10 ACTIONS OF HOUSEHOLD MEMBERSIf any member of your immediate household engages in any activity which, if performed by you, would violate any provision of the Independent Consultant Agreement, including these Policies & Procedures, such activity will be deemed a violation by you and JAFRA may take disciplinary action pursuant to this Agreement against you.

4.11 CONFLICTS OF INTERESTYou are free to participate in other business ventures or marketing opportunities except as set forth below. These restrictions apply during this Agreement and after it ends.

• You may not take advantage of your knowledge of, or association with, other Consultants who you did not personally sponsor in order to promote or sell such non- JAFRA products, services or opportunities.

• You may not offer or promote any non-JAFRA products, services, incentives, opportunities or business plans in conjunction with JAFRA’s products or opportunity. For example, among other things, you cannot sell other companies’ products at a JAFRA party, meeting, convention or other JAFRA function. Also, you cannot sell other companies’ products on a website, blog, or other social media/internet location on which you sell JAFRA products.

• You shall not solicit directly or indirectly any JAFRA independent Consultant to enroll in or register with another direct selling, multilevel, or networking marketing company.

• You shall not induce or attempt to induce any other JAFRA independent Consultant to violate or terminate her/his business relationship or agreement with JAFRA.

• You may not use or disclose to any party any JAFRA proprietary data, processes, or company information.

4.12 REPORTING POLICY VIOLATIONS OR IMPROPER ACTIVITYIf you see another Consultant engaging in a violation of this Agreement, you should report the violation directly to JAFRA.

4.13 INVENTORY BUYBACK FOLLOWING TERMINATION OF AGREEMENTThis section governs inventory buyback following your cancellation of this Agreement and your JAFRA account. Product returns that are part of your Consultant activities are discussed in Section 6.5.

If your Agreement with JAFRA is terminated, upon your request, JAFRA will repurchase Currently Marketable Inventory and JAFRA-produced promotional materials (including, without

limitation, sales aids, tools and kits) within 12 months from the date of your purchase of such inventory or materials. “Currently Marketable Inventory” means JAFRA product that is unused, and unexpired, and that is not identified at the time of sale as seasonal, discontinued, or a special promotion. Currently Marketable Inventory and JAFRA-produced promotional materials will be repurchased at 90% of your total original net cost, less set-offs and claims, which will include 90% of the net (wholesale) cost of the product and 90% of the tax which was paid, but you will not receive a refund for any shipping and handling costs that you paid when the inventory/materials were ordered. You will be responsible for paying any shipping and handling to return the inventory/materials to JAFRA.

Certain set-offs and claims may further reduce the amount for which JAFRA will repurchase your inventory. These might include, among other things: a. Product that is returned for repurchase, but which has not met the criteria of “currently marketable inventory.” Such product is deducted from the total claimed by you. b. An unpaid balance remaining on your account. The repurchase amount refunded to you will be offset by the amount due on your account.

i. When the unpaid balance is less than the repurchase amount due to you, the account balance is considered paid in full, and the remainder of the repurchase amount will be paid to you. ii. When the unpaid balance is greater than the repurchase amount due to you, the account balance is reduced by the amount of the repurchase, and you will not receive any repurchase payment. You will be required to pay any outstanding amount.

If a shrink-wrapped or pre-packed set is returned, you will receive the value for the retail price of the set only, not the individual items.

JAFRA will not accept inventory buyback requests from individuals other than the Consultant herself unless the Consultant is deceased.

To request an inventory buyback, please call JAFRA’s Customer Relationships Team.

4.14 BUSINESS KIT BUYBACKYou may return a JAFRA Business Kit within 12 months from the date of purchase for a refund by contacting JAFRA’s Customer Relationships Team. The refund amount will

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be 90% of your total original net cost, less set-offs and claims, which will include 90% of the net (wholesale) cost of the product and 90% of the tax which was paid, but you will not receive a refund for any shipping and handling costs that you paid when you ordered the Business Kit. You are responsible for paying shipping and handling to return the Business Kit to JAFRA. In the event you return the Business Kit, your agreement with JAFRA is terminated and you are not eligible to re-enroll as a Consultant until 6 months have elapsed from the date on which you placed your last commissionable order.

Section 5: Operating Your JAFRA Business

5.1 CONSULTANT MAINTENANCE REQUIREMENTTo maintain your Consultant status, you must place a retail order within a period of 12 consecutive months. If you do not place a retail order in 12 consecutive months, your status will be changed to “Former”, you are no longer eligible to place orders, and you must sign a new Independent Consultant Agreement to re-enroll with JAFRA. JAFRA makes an effort but cannot guarantee that it will notify you before you are changed to “Former” status.

A Consultant who re-joins JAFRA after being changed to a “Former” status is considered a new Consultant for all purposes and may enter the lineage of a new sponsor if desired. A “Former” Consultant will lose all benefits and seniority associated with their previous title, and a “Former” Consultant relinquishes any sponsoring benefits for any Consultants he/she may have previously sponsored.

5.2 NO EXCLUSIVE TERRITORIESJAFRA does not assign or guarantee any geographic territories.

5.3 LOCATION OF YOUR JAFRA BUSINESSThe following location restrictions apply to your JAFRA business: • You may only sell products, distribute products, market products, and sponsor new Consultants within the United States and Puerto Rico and not in any other countries.

• In all instances, you must comply with all applicable laws and requirements in the location in which you are doing business. You are responsible for knowing those laws and consulting your own legal or financial counsel if necessary.

• JAFRA products purchased in the United States cannot be delivered or sold in any country other than the United States and Puerto Rico. JAFRA products purchased by Consultants for resale in another country (for example, Mexico) must be delivered and sold only in that country.

• You may not, in any country outside of the United States or Puerto Rico: (a) conduct sales, enrollment or training meetings; (b) enroll or attempt to enroll potential clients or Consultants; or (c) conduct any other activity for the purpose of selling JAFRA products, sponsoring, or promoting the JAFRA opportunity.

5.4 OPERATING YOUR JAFRA BUSINESS THROUGH A BUSINESS ENTITYYou may not operate your JAFRA business through a business entity. In other words, a corporation, limited liability company, partnership, or any other business entity may not apply to be a JAFRA Consultant.

5.5 ACTING ON BEHALF OF ANOTHER CONSULTANT OR COMBINING ORDERSYou may not conduct transactions or act on behalf of another Consultant. For example, among other things, you cannot: • Utilize a credit balance on someone else’s account (for example, by placing an order against it); • Place or cancel an order on behalf of another Consultant; • Make a payment on someone else’s account or purchase products using another person’s name or account; • Change someone’s shipping or billing address; • Log into someone else’s account. You may not combine orders with another Consultant. This policy is to preserve the maintenance of product quality control, accuracy of point accumulations for awards and recognition, Compensation Plan benefits, and sales tax and income reporting.

5.6 TRANSFER OF SALESYour personal sales of JAFRA products may not be transferred to any other Consultant. JAFRA reserves the right to cancel such orders and void all other benefits, including but not limited to, promotion within the Compensation Plan, commissions, etc.

5.7 TRANSFER OR ASSIGNMENT OF BUSINESS Your independent Consultant business relationship with JAFRA is a personal relationship. You cannot sell, assign, or transfer any rights in this Agreement or in your JAFRA business.

5.8 REPORTINGIt is your responsibility to track and keep accurate records of expenses and revenue associated with your JAFRA business. Reporting all income generated by the sale of JAFRA products to the appropriate agencies is your sole


responsibility. Such income includes but is not limited to: retail sales profit, commission overrides, prizes received/earned, bonuses, trips, gifts and awards.

5.9 BUSINESS LICENSEYou must adhere to all applicable local, state and federal laws, which among other things, may require the maintenance of a business license in order to conduct business out of your home or commercial office. JAFRA encourages you to seek professional advice for questions regarding this matter.

5.10 CLIENT REFERRAL LEAD PROGRAM JAFRA’s Lead Program gives you the opportunity to receive “Leads”, which are people who could be interested in joining JAFRA as a Consultant, hosting a party, or buying JAFRA product.

How Does the Program Work? • JAFRA receives Leads via phone, email, or internet. Once JAFRA receives a Lead, JAFRA will assign the Lead to a consultant, at JAFRA’s sole discretion, depending on the Lead’s interest, language and vicinity. JAFRA’s lead administrator will send the consultant an email with the Lead’s contact information.

• A consultant receiving a Lead is encouraged to call the Lead within 48 hours of receiving JAFRA’s email.

• The Consultant must follow up with JAFRA’s lead administrator within 2 business days of receiving the Lead to confirm receipt of the Lead and action taken. You may call in the results at 1-800-551-2345 or send the results via email to [email protected]. If sending the results via email, be sure to include your name and ID Number, the Lead’s name, and the results such as: 1. Sponsored (include Lead’s Consultant ID number) 2. Purchased product (include amount ordered) 3. Held JAFRA Party 4. Wanted Information Only 5. Not interested 6. Unable to contact 7. Contacted; results pending 8. Other (please explain).

5.11 IRS FORM 1099JAFRA will provide Consultants a 1099 MISC form, as well as report to the IRS an earnings statement, for Consultants who have:

• Had commission earnings over $600 in the previous calendar year; • Purchased $5,000 or more in wholesale items from JAFRA; or • Received $600 or more in overrides, bonuses and/or prizes.

Form 1099 is to be used by the Consultant to prepare his/her individual tax returns on a yearly basis. JAFRA recommends that every Consultant seek professional tax advice and guidance

from a Certified Public Accountant or other tax professional. JAFRA is not responsible for any personal income tax liability due to Consultant’s performance of services for JAFRA.

5.12 REQUESTS FOR RECORDSJAFRA reserves the right to charge you a fee for the time and expense of providing copies of invoices, applications, downline activity reports, or other records that you request.

Section 6: Purchase and Sale of Products

6.1 SELLING PRODUCTS TO CLIENTS

As a JAFRA Consultant, you sell JAFRA products via the direct-to-consumer approach, and your success with clients depends on personal relationships. Through direct sales, clients may experience the products before buying and receive proper individual instruction in product use, both before and after the sale. Therefore, JAFRA’s policies regarding sales are intended to steer you away from the pursuit of the one-time only, impulse sale and toward long-term, relationship-based sales. It is beneficial for you to put forth your best efforts in servicing clients and in creating and maintaining the goodwill of clients toward JAFRA.

6.1.1 Authorized channel of distribution The only authorized channel of distribution for selling JAFRA products is directly to the end-consumer (the client who uses the product) on a one-on-one basis, either in person or through official JAFRA e-commerce platforms (like your JAFRA Personal Website). You shall not sell JAFRA products in locations open to or available to the public. For example, among other locations, you shall not sell JAFRA products: (a) at swap meets, flea markets, or farmers markets, (b) on eBay, Amazon, Craigslist, Facebook Marketplace, Walmart.com, Jet.com or other electronic forums (c) on any website or social media platform not authorized by JAFRA, or (d) on Mercari, Poshmark, letgo, or any other mobile app sales platforms. A violation of this provision may lead to the termination of your Consultant account and the award of damages to JAFRA.

6.1.2 Product sales to non-consumers for resale You shall not sell or otherwise provide JAFRA products to non-consumers for the purposes of resale. This prohibition on resale of JAFRA products includes, but is not limited to, sales by non-consumers conducted in retail establishments, internet retail websites, or internet auction websites. Nor may a Consultant sell to a non-

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consumer any quantity of JAFRA products greater than that generally purchased by an individual for personal use. A violation of this provision may lead to the termination of your Consultant account and the award of damages to JAFRA.

6.1.3. Documenting sales to the end-consumer It is important that you keep records of your sales of JAFRA products to your clients for a period of two years from the date of each sale for business and regulatory reasons. JAFRA reserves the right to request copies of these records of your sales to your clients and end consumers. The documentation of sales of JAFRA products to the end consumer should include the product(s) purchased, the end-consumer’s name, address, telephone number, and email address. The requirement that you retain documentation of your sales is essential to ensure that JAFRA is able to contact end-consumers following the sale of JAFRA products with any information necessary for the customers’ continued enjoyment of JAFRA goods (i.e. updated product information, updated usage instructions, product recalls, etc.). JAFRA may audit your compliance with this provision and take disciplinary action against Consultants who fail to comply with these terms.

6.1.4 Sales outside of channel of distribution No warranties, exchanges or refunds will be granted for JAFRA products known to be sold outside of authorized channels of distribution. For more information on warranties, exchanges and/or refunds for products sold through the authorized distribution channels, see Section 6.5.

6.1.5 Product re-packaging and re-sale of samples prohibitied JAFRA products may only be sold in their original packaging, complete with instructions for use, warning labels and ingredient lists if applicable. You may not repackage, re-label, adulterate or tamper in any way with any product packaging, warning labels, instructions, or JAFRA materials or literature. You may not re-sell or re-package JAFRA products as private label products, re-design any products, or sell used or opened products. You may not sell, giveaway, or distribute as gifts products that are designed to be sold within a fixed set (i.e. sets where JAFRA has designated specific products to be sold together) as separate, individual products. You may not sell products designated as “samples” by JAFRA.

6.1.6 Customer service Personal relationships are essential to your success as a JAFRA Consultant and to the value received by your clients when they purchase a product from you. As such, it is recommended that you provide your clients with current contact information and make it known to your clients

that you are available to answer questions, provide advice, and respond to client concerns both before and after the sale of any product. You should consult your JAFRA materials, refer to and use available educational tools, or contact JAFRA directly for guidance in responding to the clients’ questions or concerns.

6.1.7 Client order form At the time you take an in-person order from a client, you are responsible to provide each client with an official JAFRA “Client Order Form.” This official Client Order Form provides the required “Buyers Right to Cancel,” Terms and Conditions and the Notice of Cancellation.

You should retain a copy of each signed Client Order Form as proof of purchase, protecting you from any future discrepancies. Signed copies are critical and can be used as proof of purchase when charge backs are in question. When a credit card is used, it is required that the Client Order Form be signed/dated by the owner of the credit card being used.

You may not use JAFRA’s official Client Order Form for products/services not offered or sold by JAFRA. You may not duplicate, reproduce or replace JAFRA’s Client Order Form.

6.1.8 Sales receipts You must provide your clients (except for those who place direct orders through your JAFRA website) with two copies of an official sales receipt at the time of the sale. You must maintain a copy of all sales receipts for a period of 12 months and furnish them to JAFRA at JAFRA’s request. In addition, you must orally inform your clients of their cancellation rights at the time they place an order from you. All guarantees, refunds, warranties are void without an official JAFRA receipt/order form.

6.1.9 Three-day cancellation period for client sales A client has three (3) business days (Saturday is a business day) after the sale of JAFRA products or execution of an independent Consultant contract to cancel the order/contract and receive a full refund. If you make a sale or take an order from a retail customer who cancels or requests a refund within the cancellation period, you must promptly refund the client’s money as long as the products are made available to you in as good condition as when received. You must orally inform clients of their right to rescind a purchase or an order within this three-day cancellation period, and ensure that the date of the order or purchase is entered on the order form.


The client may give notice of cancellation by mailing or giving you the cancellation form or any other written notice.

Following valid delivery of this notice of cancellation within the specified time period, the client must make available, at her/his residence, in the same condition as when she/ he received them, any products received as a result of this transaction prior to receiving a refund. In the alternative, a client may follow your instructions regarding the return shipment of the products at your risk and expense.

If a client makes the products available for retrieval and you do not pick them up within 20 days of your client’s notice of cancellation, the client may retain or dispose of the products without any obligation.

Within 10 business days of your receipt of your client’s notice of cancellation, you must return any amounts received for this canceled transaction to your client provided that you receive the products from the client.

6.2 ORDERING PRODUCT FROM JAFRA

6.2.1 Paying your order/account You can make a payment on your account at any time either via the web (www.JAFRAbiz.com) or by phone by calling our 24/7 automated system (1-800-852-3728). You may make a payment via credit card (Visa®, MasterCard®, Discover®, American Express®), debit card, check, money order, or JAFRA Debit MasterCard.

6.2.2 Paying by check You may generally pay for your order by check, unless JAFRA notifies you that you have lost the privilege to send payment by check as a result of having a check returned to JAFRA by your bank (i.e. a “bounced check”). In the event your personal check is returned to JAFRA by your bank, (a) your JAFRA account will be charged the amount of the returned check plus the current returned check fee; (b) you may only pay for future JAFRA purchases by money order, cashier’s check or credit card; and (c) you must make a valid payment before subsequent orders can be processed.

6.2.3 Shipping & handling JAFRA applies a shipping and handling fee for each order placed with JAFRA. Shipping and handling fees can be found on the official Consultant master order form, the monthly Consultant order form, and the JAFRA client order form. Shipping and handling on web orders are discounted $2. Shipping and handling fees are subject to change. Additional shipping and handling fees may apply for orders sent outside of the continental United States.

6.2.4 Sales taxJAFRA collects and remits sales taxes on behalf of its Consultants, based on the suggested retail price of the products, according to applicable tax rates in the state or local taxing jurisdictions to which the shipment of products is being sent. Sales made by a Consultant outside of the ship-to location may be subject to additional tax reporting or sales tax obligations by the Consultant, as the taxability of products and sales tax rates may differ by state, country, city, or county. This could result in a disparity in what JAFRA charges a Consultant and what the Consultant in turn can charge a client, depending upon where the sale occurs. It is always the responsibility of each Consultant to track and remit any sales tax in addition to what has been previously collected and remitted on their behalf to the appropriate jurisdiction.

If a Consultant has submitted, and JAFRA has accepted, a current Sales Tax Exemption Certificate and Sales Tax Registration License, sales taxes will not be added to the invoice and the responsibility of collecting and remitting sales taxes to the appropriate authorities shall be on the Consultant.

Exemption from the payment of sales tax is applicable only to orders that are shipped to a state for which the proper tax exemption papers have been filed and accepted. If sales are made outside of the exempt jurisdiction, Consultants are responsible for recording and remitting the appropriate sales taxes. Any sales tax exemption accepted by JAFRA is not retroactive. Consultants should direct any questions regarding their tax and reporting obligations to their own independent tax advisors.

6.2.5 GiftsWhen you achieve a promotion or earn a reward or gift, gifts may be sent automatically with an order. However, if you request to have the gift sent separately from an order, you will be required to pay shipping and handling for the gift.

6.2.6 Price and product availabilityJAFRA reserves the right to change the prices at which it offers products for sale and the range of products offered without prior notice.

6.2.7 Correct and prompt ordersJAFRA is not responsible for order delays incurred by Consultants due to circumstances beyond JAFRA’s control such as: typographical errors, entering any client data incorrectly, weather, acts of God, etc. It is your sole responsibility to double check all orders for accuracy prior to processing.

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6.2.8 Timing of orders for monthly commissions or incentivesOrders and payments during the month will count for commission, awards, or incentives for that month. Orders and payments must be submitted by 11:59 pm Pacific Time to be counted for commission, awards, or incentives for that month.

The following rules apply:

1) Orders placed during the month (not necessarily paid) count towards leader and Consultant ordering requirements for evaluation of central branch maintenance and eligibility of commission override payment.

2) Order payments during the month will count towards payments for commission override calculation only when the order is paid in full. For example, if you place an order using JAFRA credit for $400.00 during a certain month (for example, February) and pay only $300.00 during that same month (February), the order will not be released as paid in that month (February). When you pay the balance of $100.00 in the following month (March) the order will be released and the entire $400.00 payment will count towards the Paid Retail Sales of the following month (March)

3) Sales incentives are based on paid retail sales.

6.2.9 Product quantities over 50Orders are limited to a quantity of 50 per individual product/set/ SKU. Order requests for more than 50 units of any single product/set/SKU will need approval by JAFRA prior to processing. Any order over 50 requires approval from JAFRA. The only exception is sales aids, which can be ordered in any quantity. JAFRA reserves the right to adjust an order’s product quantity request at any time.

6.2.10 Product/order not received Failure to receive an order or product must be reported to JAFRA within 14 days of the order’s ship date by contacting the Consultant Relationships Team (CRT) via email at [email protected] or by phone during business hours. If a product requested is missing from your order, please look for an explanatory note on your invoice or on a drop note placed separately in your order. If the product appears on the invoice and no note of explanation is found, contact CRT during JAFRA business hours and provide the order number and item number to the Team Member.

If you email JAFRA to notify of a missing order/product, please include the following information: • Your name • Your Consultant ID Number • The shipping address of the order • The order date and order number • Product number of missing product (if applicable)

If you request that we ship an order to an address other than the address that appears on your JAFRA account, JAFRA will not be responsible for any order discrepancies or orders not received. For example, if you request that we ship an order to your leader’s address, your leader and not JAFRA is responsible for that order.

6.2.11 Inspection of delivered products Upon receipt of an order, you should immediately inspect the order to ensure that it is complete and undamaged. You should inspect each product to ensure that no product is expired or soon to be expired, damaged, or tampered with. Additionally, you should inspect each product to confirm that the product’s seal has not been broken. In the event that you receive products that have been damaged, tampered with, have broken seals, or are expired, you are prohibited from selling any such products to customers. As explained more fully in Section 6.5.1, you should notify the Customer Relationships Team (CRT) at [email protected] to request replacement products and provide the CRT with required information concerning any damaged or defective products.

6.2.12 Storage and handling of products All JAFRA products should be stored in a cool, dry, and hygienically safe area or as otherwise directed by the label. As a general rule, the products should be kept at least four inches (4”) above the floor and out of direct sunlight. JAFRA is not responsible for product that is damaged due to improper storage. Prior to offering any products for sale to end-customers, you should inspect each product to ensure that it is properly sealed and has not reached its expiration date. Any product that is damaged, unsealed, or expired may not be sold to end-customers.

6.3 CHANGES TO ORDERS

6.3.1 Product add-ons Once an order has been submitted for processing, products and/or quantities cannot be adjusted. Any additional product will be processed as a separate order and the normal shipping and handling fee will apply.


6.3.2 Address corrections/change of shipping addressTo change a shipping address for an order prior to placing the order, you must call the CRT and provide the updated shipping address. Any changes made to your account information will be updated online immediately.

If the shipping address that you provided at the time of the order was incorrect, the shipping carrier may still be able to deliver the order to you depending on where the package is located in transit. Address changes must be made by calling CRT by phone during normal business hours. You will incur a minimum charge of $12 for re-routing per tracking number. JAFRA cannot guarantee a successful re-routing.

6.3.3 Cancelling product ordersIf you have placed your order and paid for it, you may call CRT in a timely manner and CRT will make every effort to cancel the order. However, sometimes orders are shipped immediately and such orders cannot be cancelled. JAFRA is unable to guarantee a successful cancellation of your order.

If an order is in transit and you no longer wish to receive it, you may refuse the order from the courier. Once the refused order is received back at JAFRA’s distribution center, a credit (less shipping and handling) will be processed on your account. If you are unable to refuse the order from the courier and it has not been opened, please contact CRT for order return procedures.

6.4 PRODUCT AVAILABLITY

6.4.1 Temporarily unavailable productsIn the case of a temporarily unavailable product, information will be provided to you either on the invoice or on a separate drop note included in the package explaining which of the following actions will be taken when an out-of-stock situation occurs:

• Temporarily Out Of Stock – Back-ordered products will be indicated on invoice and will be shipped once the product becomes available. • Permanently Out-of-Stock - If a substitution is made available on an unavailable product, you may select the substitution and/or cancel the order for a credit. Substitutions are always of equal or greater value. Please note that out-of-stock products may reduce the retail value of an order, which can affect sales volume, awards, recognition, etc.

6.4.2 Product availability reportYou can keep current on the status of JAFRA products via

the “Product Availability Report” which is posted at “www.jafrabiz.com”. The status categories and definitions are as follows:

• TEMPORARILY UNAVAILABLE – Products that are currently unavailable but will come back at a later date. • TO BE DISCONTINUED – Regular line products that are no longer being produced and will soon be unavailable. These products are sold while supplies last with a “discontinued price.” All sales are final for products purchased from the “To Be Discontinued” list. No returns or exchanges will be accepted. • DISCONTINUED – Products that have been removed from the regular line and are no longer available or that are “limited life” products that were offered on a “while supplies last” basis and are no longer available and will not be coming back. • SUBSTITUTIONS – Specially selected alternatives to gifts with purchase and products included as added values to special offers with equal or greater value to what was originally offered. • OUT OF STOCK – Limited life products that were offered on a “while supplies last” basis and are no longer available and will not be coming back.

Please note: Discontinuation is part of the nature of the business, and a reflection of the fact that JAFRA is a growing, dynamic brand that is keeping pace with other industry leaders. It is recommended that you view the Product Availability Report for current information.

6.5 RETURNS/REPLACEMENTS/EXCHANGES

6.5.1 Damaged or defective products (Consultants)

Each order is packaged with care. However, occasionally your package may contain product damaged in shipping. If this occurs, call or email us within 14 days from the order’s ship date.

To report damaged or defective products, contact the Customer Relationships Team (CRT) at [email protected] to request a replacement. Be sure to include the following information in your email:

• Consultant Name • Consultant ID Number • Complete Shipping address

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• Order Date • Order Number on which product(s) was purchased • Product Number and Quantity of the product(s) being replaced • Reason for the defective replacement (i.e., broken container, pump doesn’t work, etc.) • Batch Code of the product(s) being replaced

In the event that the product received was damaged during shipping, include this additional information:

• What was the condition of the shipping box? • In what way is the product damaged? (i.e., broken container, missing cap)

For quality assurance purposes, JAFRA may request the defective or damaged product(s) be returned. If product is requested and not returned within 45 days from the return request date, your account will be charged the full retail value for the item that was replaced.

Consultant business kits, seasonal products, products given as incentives, business supplies, and other sales tools may not be exchanged.

6.5.2 Product replacement & exchangesJAFRA strives for product satisfaction and if your client should find any product unsatisfactory, and your order for that product was placed within the past 6 months, please contact CRT during business hours for replacement procedure.

Please note that client orders purchased from JAFRA.com or a Consultant’s personal website are subject to the Sales and Shipping Policies found on JAFRA.com.

If the product to be exchanged was purchased within a variable set (sets where selections are chosen), the product can be exchanged for an equal product subject to availability at the time of order.

If the product to be exchanged was purchased within a fixed set (sets where JAFRA has designated specific products to be sold together), a replacement will only be made for the same set of products, subject to availability.

Exchanges may be made for products of equal or greater value. In the event the product is exchanged for another product of greater value, JAFRA will process a debit for the price difference on your account.

Exchanges or replacements may not be made for products that were not available, on backorder, or temporarily

unavailable at the time of the original order.To request product replacements or exchanges, contact CRT via email at [email protected] or by phone during business hours. Include the following information:

• Consultant Name • Consultant ID Number • Complete Shipping Address • Order Date • Order Number on which the product(s) was purchased • Product Number and quantity of the product(s) being replaced or exchanged • Reason for the replacement or exchange • Batch Code of the product(s) being returned or replaced • Product Number and description of the substitute product.

JAFRA reserves the right to request that unsatisfactory product(s) to be returned. If product is requested and not returned within 45 days from the return request date, your account will be charged the full retail value for the item that was replaced in good faith. Your commission on the product(s) may be adjusted.

JAFRA reserves the right to refuse returned items (i.e. return not authorized, product reported as “unused” but is returned used and/or in unacceptable condition) or to debit your account if the product returned is more than 50% used. Product returns/ replacements/exchanges are at the sole discretion of JAFRA.

If a client purchases a product on JAFRA.com or through your JAFRA Personal Website and finds the product unsatisfactory, the client may return the product to JAFRA within 60 days from the purchase date (the “60 Day Satisfaction Guarantee”). The 60 Day Satisfaction Guarantee applies only to purchases made through authorized sales channels, which include JAFRA.com or a Consultant’s JAFRA Personal Website. It is your responsibility, as a Consultant, to inform your clients of the 60 Day Satisfaction Guarantee.

6.6 JAFRA CREDIT PROGRAM; PAYING YOUR ACCOUNT

6.6.1 Applying for credit; requirements to receive creditYou may request a $300 credit limit from JAFRA if these requirements are met:


• You complete 6 consecutive months of affiliation with JAFRA (A Former Consultant who re-joins is also required to complete 6 consecutive months of affiliation to apply for the Credit Program.)• You have achieved $300 in Paid Wholesale Sales.• You have no past due invoices, returned checks, or negative credit card activity on your JAFRA account, and you have never been sent to collections or had bad debt on your JAFRA account. • You provide a current proof of address and a valid phone number where you can be reached. Proof of address may be a document such as a utility bill, driver’s license, or voided personal check in your name with a current address listed that appears on JAFRA records.

Credit limit increases above $300 may be granted if it has been 6 months since the last increase and the required Paid Wholesale Sales have been achieved with no returned payments or past due orders within those 6 months. Increases are granted one level at a time.

• $500 limit requires $1,000 Paid Wholesale Sales• $1,000 limit requires $2,000 Paid Wholesale Sales• $1,500 limit requires $2,000 Paid Wholesale Sales• $2,000 limit requires $2,000 Paid Wholesale Sales• $2,500 limit requires $2,000 Paid Wholesale Sales

Request for credit can be made by phone but verification of address must be faxed, mailed, or emailed to JAFRA. Establishment of credit and credit limit increases are discretionary, not automatic.

If you have qualified to receive credit, your current credit limit will be noted on “www.jafrabiz.com”. Continuation of the credit privilege is discretionary and dependent on adherence to JAFRA’s payment terms. Non-compliance will result in a pre-pay account status (see Section 6.7 below).

6.6.2 Orders placed with creditIf you place an order using JAFRA credit, and your total exceeds the amount of your JAFRA credit, you must pay the additional amount that exceeds your available credit before your order is released.

6.6.3 Balances payment; late feesAll balances are due within 14 days of the order’s ship date. An order will be considered past due if payment is not received within 21 days of the order’s ship date. Subsequent orders will not be processed when an account has a past due balance.

• Late payment fees of 2% on outstanding balances will be incurred at 21, 45, 60, 90, and 120 days from the order’s ship date. The minimum late fee is $10.00.

• Overrides, bonuses, incentives, and rewards will only be awarded to a Consultant who is in good standing. • A Consultant who has paid the outstanding balance in full and is approved to return to active Consultant status will be required to permanently pre-pay all orders.

6.6.4 Accounts sent to collection (bad debt)In the event that you have an outstanding credit balance over 120 days past due, JAFRA’s Credit & Collections Department will assign the bad debt to a collection agency. JAFRA reserves the right to terminate the agreement of a Consultant with an outstanding balance that has been referred to a collection agency. Should a Consultant wish to rejoin JAFRA, all bad debt must be paid prior to consideration of acceptance of a new Consultant agreement, along with 50% of the amount that was assigned to the agency to cover the collection costs incurred by JAFRA.

6.7 PRE-PAY STATUSPre-Pay Status means that you must fully pay for your order before JAFRA will process and ship it. The only Consultants that are not on Pre-Pay Status are those Consultants who are on the JAFRA credit policy. Consultants who must pre-pay their accounts are: (1) all new Consultants, (2) Consultants who don’t apply for credit, (3) and Consultants who don’t comply with the credit policy or who have checks returned and are told by JAFRA that their account is on “Pre Pay Status.” To pre-pay orders, calculate the amount of the order including sales tax and include payment at the time of order. If you are on Pre-Pay Status, you are not permitted to pay via cash or personal check; you may only pay by credit or debit card.

To get off of Pre-Pay Status, you will need to complete all of the following requirements: (1) fully pay your account, (2) maintain a good payment record for one year, (3) have $500 in Paid Wholesale Sales in the past 4 months, and (4) have no returned payment activity in the last 6 months.

Section 7: Promoting JAFRA Products and Your Business

7.1 PROMOTING YOUR AFFILIATION WITH JAFRAWhen you identify yourself as affiliated with JAFRA, you must make clear that you are an independent contractor, not a JAFRA employee. At all times, you must make clear that you are acting on your individual behalf, and not on behalf of JAFRA Cosmetics International, Inc. For example, when you identify your JAFRA business,

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including in print, online or on the phone, you must use: “Your Name, JAFRA Independent Consultant.” You are not permitted to place the words “JAFRA Cosmetics International, Inc.”, “JAFRA”, “JAFRA Cosmetics” immediately before or after your name because to do so would suggest that you have an employment relationship with JAFRA.

7.1.1 Telephone & voicemail greeting You may leave a recording on your answering machine or answer the phone by identifying yourself as a JAFRA Independent Consultant. You are prohibited, however, from answering the telephone in any way that would give callers a reason to believe they have reached JAFRA’s corporate office.

For example, an acceptable phone greeting would be: “Hello, you’ve reached [YOUR NAME], a JAFRA Independent Consultant.”

An unacceptable phone greeting would be: “Hello, you’ve reached [YOUR NAME] at JAFRA Cosmetics.”When listed in any phone directory or phone book, you must be listed as “Your Name, JAFRA Independent Consultant”.

7.2 TRADEMARKS, COPYRIGHTS, AND DOMAIN NAMESYou shall not copy or reproduce in any manner any JAFRA copyrighted materials or use such materials in any manner which, in the sole judgment of JAFRA, would harm or threaten to harm JAFRA’s business, rights, or privileges, including without limitation its intellectual property rights, except with the prior written approval of JAFRA or as otherwise provided in the Policies & Procedures. The name JAFRA, and all JAFRA trademarks and trade names are the exclusive property of JAFRA. You shall not use JAFRA’s trademarks or trade names or any confusingly similar mark, except with the prior written approval of JAFRA or as provided in the Polices & Procedures. You shall discontinue any use of any trademark, trade name or copyrighted material owned by JAFRA upon receipt of written notice from JAFRA.

All JAFRA literature, brochures, text, logos, icons, photographs/images, audio recordings, videos, DVDs and programs published in any form and authored in any manner are copyrighted by JAFRA and may not be duplicated except with the written consent of JAFRA or as otherwise permitted in our Agreement.

JAFRA encourages all Consultants to safeguard and positively promote the reputation of the JAFRA brand and its products. JAFRA reserves the right to request, and Consultant agrees to, the immediate removal of any advertising or Internet presence that JAFRA feels, in its sole discretion, is inappropriate, unacceptable, misuses JAFRA’s intellectual property, or in any way interferes with or damages JAFRA’s rights in, or the goodwill

associated with, such trademarks, trade names and copyrights.

If you come across any misuse, infringement, misrepresentation of the JAFRA brand, trademarks, or products by a third party, please notify JAFRA. You should not, and you are not authorized to, act on JAFRA’s behalf in such situations. You must cooperate with JAFRA to the fullest possible extent in any investigation or enforcement effort.

7.2.1 Trademark license grantSubject to the terms and conditions of this Agreement, JAFRA grants and you accept the limited, royalty-free, non-exclusive, non-transferable, revocable right to use JAFRA’s trademarks for the sole purpose of selling JAFRA products and building your JAFRA business. You do not acquire any interest under this Agreement other than the rights to JAFRA’s trademarks granted here. You do not acquire any right to sub-license JAFRA’s trademarks. Any rights not expressly granted to you are reserved to JAFRA.

Term. The term of the trademark license set out in this section 7.2 is for the term of this Agreement or a shorter period in JAFRA’s sole discretion.

Non-Exclusive Grant. Nothing in this Agreement will be construed to prevent JAFRA from granting any other licenses for the use of the JAFRA’s trademarks or from using JAFRA’s trademarks in any businesses.

Use of Marks. You shall use and display JAFRA’strademarks only (a) in association with the promotion and sale of JAFRA products and the promotion of the JAFRA opportunity; (b) in the manner and form that JAFRA’s trademarks are registered; and (c) in accordance with the terms of this Agreement.

Benefit of Goodwill. Your use of JAFRA’s trademarks and any resulting goodwill will accrue solely to JAFRA’s benefit.

7.2.2 Prohibited actionsExcept as otherwise permitted in our Agreement, you shall not, directly or indirectly:

• Register or use any other trade name, trademark, or service mark incorporating or based in whole or in part on (1) our name JAFRA, (2) JAFRA’s brand names, trade names, trademarks, service marks, product names, domain names, symbols, logos, slogans, artwork, or other identifiers or designations of origin of JAFRA (“Marks”).• Use all or part of any of the Marks (or any misspellings


or derivations of the Marks) as any Internet domain (including, without limitation as a sub-domain on JAFRA’s websites or as your name or user ID within any blogs, social networking sites, “posting sites”, or as the numbers/designations within your phone number). • Use any of the Marks in any email address, social media handle, or customized license plate.• Use any Mark as part of any business name, as part of any signage displaying a business name, or in connection with any unauthorized goods or services.• Use the word “official” in conjunction with any of the Marks or use a specific geographic location in conjunction with any of the Marks (i.e. JAFRACalifornia).• Debrand, rebrand, or privately label any of the Marks. • Copy, modify, or recreate any of the Marks or any mark that is similar to the Marks. • Hold yourself out as having any ownership interest in the Marks. • Engage in any conduct that would adversely affect JAFRA’s interest in its Marks or the goodwill associated with them. • Dispute the validity, ownership, or enforceability of any of the Marks.• Engage in any conduct that would constitute infringement of, or otherwise harm, the intellectual property rights of any third parties.

7.2.3 Documenting use of marksYou shall provide to JAFRA, if requested, documentation of your use of JAFRA’s Marks.

7.2.4 Actions in JAFRA’s best interestsYou shall act in the best interests of JAFRA as owner of the Marks and in such a way as to preserve and protect JAFRA’s interest in its Marks.

7.2.5 Domain names You shall not use or register any of JAFRA’s trademarks, product names or any derivatives or abbreviations thereof as Internet domain names, email addresses, social networking profiles, or online aliases. You shall not use or register domain names, email address, social networking profiles, or online aliases that could cause an individual to believe or assume that the site/page/communication is from or is the property of JAFRA. Examples of such improper use are “[email protected]”, “iselljafra.com”, @jafracalifornia, or having JAFRA show up as the sender of an email.

7.2.6 Use of JAFRA’s copyrights JAFRA produces promotional materials, which are posted on “www.jafrabiz.com” for Consultant use. Likewise, JAFRA produces its own promotional videos, some of which are posted on social media. If you use any of these materials or

videos, you must use the materials or videos as they are posted and never edit them.

7.2.7 Use of JAFRA logo You are not permitted to use the corporate JAFRA logo (which is the name JAFRA or the name JAFRA and the slogan “Freedom to be you”) in any materials/content/posts that you create unless you have written consent from JAFRA. Similarly, absent prior written consent, you are not permitted to use any corporate logos previously used by JAFRA. You may use the approved JAFRA Independent Consultant logos provided on “www.jafrabiz.com” for any of your Consultant activities. You are not allowed to modify or change that logo in any way.

All images, logos, trademarks and copyright materials of JAFRA and all rights therein are the exclusive property of JAFRA. Any abuse of the foregoing is actionable infringement for which JAFRA may pursue any and all available legal remedies.

7.3 PROMOTING JAFRA PRODUCTS AND OPPORTUNITY

7.3.1 Implying employment prohibitedAs part of promoting the JAFRA opportunity or recruiting new JAFRA Consultants, you are prohibited from making any promotions, representations, or implication of employment, salaried positions, management positions, hourly wages, full or part time positions, or guaranteed incomes. The opportunity to earn money from JAFRA is not a job or employment and may not be presented as such. When talking about JAFRA or the JAFRA opportunity, you many not use terms such as “manager trainee,” “management positions available,” “travel provided,” “call for interview,” “positions available,” “now hiring” or other misleading statements that imply employment.

7.3.2 Product & testimonial claimsYou may not make claims (including personal testimonials) as to therapeutic, curative, or diagnostic properties of any products offered by JAFRA except for those specific claims contained in official JAFRA literature. Such claims may only be repeated or republished in exactly the same format as that published by JAFRA and the claim must be republished in its totality. Specifically, you may not make any claim that JAFRA products are useful in the cure, treatment, diagnosis, mitigation, or prevention of any diseases. Such statements can be perceived as medical or drug claims. Not only do such claims violate JAFRA policies, but they potentially violate federal and state laws and

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regulations, including the Federal Food, Drug, and Cosmetic Act and the Federal Trade Commission Act. You should advise clients who have medical questions to consult with a physician regarding any such question before using JAFRA products. Whenever you are using any JAFRA product or opportunity materials, you must always include any and all notices, warnings and disclaimers provided by JAFRA. You have a responsibility to educate yourself using up-to-date JAFRA literature so that you can provide clients with accurate information. All product representations made by you must be the same as those found in current JAFRA literature and promotional materials.

7.3.3 Promotional materials/ merchandiseYou may make the following items as long as they clearly display the JAFRA Independent Consultant logo (and not the corporate JAFRA logo): • Business cards • T-shirts, hats, jackets, and other items of clothing • Nametags • Pens and stationary

You are allowed to print or download marketing materials found in “www.jafrabiz.com” that are specifically designed for Consultant use, such as monthly promotional and incentive flyers.

You may not make items such as tablecloths, banners, posters, or printed flyers without permission from JAFRA. Please email [email protected] to ask for permission for your project.

You may not alter, photocopy, or reprint for distribution any JAFRA Catalog, Seasonal Essential Brochure, Action Brochure, or other JAFRA promotional material, except as provided in Consultant Connection. You may not create your own flyers or any type of material that advertises JAFRA products, promotes the JAFRA opportunity, mentions JAFRA commission payments, mentions the JAFRA compensation plan, or attempts to recruit people to join JAFRA. You may not copy any of JAFRA’s graphic images (including without limitation pictures of JAFRA products, models, gifts, text, or logos).

7.3.4 Marketing eventsYou may market sponsoring opportunity sessions, JAFRA parties, or any other JAFRA event as long as you follow these Policies & Procedures when doing so.

7.3.5 Product pricing and promotion guidelines When promoting or selling JAFRA products or the JAFRA opportunity, you may not offer additional incentives not offered by JAFRA, including but not limited to, free or reduced shipping charges, gifts, bundles, coupons,

promotional codes, discounts or any other similar incentives on the sale of JAFRA products. You may not offer any type of payment or incentive in connection with any recruitment, sponsoring, or enrollment of new Consultants. You may not offer “free” enrollment or any reduction in the standard enrollment charges as an incentive to new Consultants by refunding any or all of the cost of the new Consultant’s original enrollment fee.

7.3.6 Media promotionJAFRA’s corporate offices initiate all press opportunities on behalf of all JAFRA Independent Consultants. You are not permitted to initiate press opportunities or press releases to promote JAFRA, its products, or its opportunity. If JAFRA creates press releases for Consultant use, such press releases must be used as-is and not altered.

If you receive a media inquiry regarding JAFRA, you must direct any such question or opportunity to JAFRA at [email protected].

7.3.7 Phone, email, and mass media solicitationIn the course of your JAFRA Consultant activities or while promoting JAFRA, you may not:• use telemarketing or other mass market direct-to-consumer electronic communications • send, either directly or indirectly, any form of communications using artificial or pre-recorded voice messages or any form of automatic telephone dialing systems or other automated devices • engage in telemarketing activities through the use of manual call center “cold calling” or similar sales operations

In the course of your JAFRA Consultant activities or while promoting JAFRA, you must follow all applicable laws and regulations that apply to unsolicited telephone calls, text messages, emails, faxes and other written or electronic communications. Significant fines and severe penalties may result if you do not follow the laws applicable to telephone and mass media solicitations. It is your responsibility to consult with an attorney on these laws and to learn and understand any applicable laws.

When sending any email that promotes JAFRA, the JAFRA opportunity, or JAFRA products, you may not use deceptive subject lines and/or false header information. You must honor all opt-out requests immediately, and you must immediately forward the opt-out request to JAFRA at “[email protected]”. If you send any email that promotes JAFRA, the JAFRA


opportunity, or JAFRA products, you must, at a minimum, include the following:• A clear and conspicuous disclosure that the message is an advertisement or solicitation.• A functioning return email address.• A functioning “opt-out” notice.• Your physical mailing address.

7.3.8 “Before and After” PhotosBefore-and-after photographs must represent the average results that may be expected by a consumer.

As with any post relating to JAFRA, you must disclose your relationship to JAFRA. For example, if you are an Independent Consultant, you must include in your post the hashtag #JAFRAIndependentConsultant or say in your post “I am a JAFRA Independent Consultant.”

When taking before-and-after photographs, you must take such photos in the same settings and under the same circumstances. In both the before and after photo, you should have the same facial expression, makeup (or lack thereof), and body position/pose, and the lighting and camera angle should be the same. You are not permitted to edit, “photo shop”, or use filters on the before or after photos. The photos must not be re-touched in any way. State in the post how long you used the product before taking the after photo (for example, “after 4 weeks of twice daily use”), or if the product was only used once, how long after application the photo was taken. Any other material information that would affect how consumers view the photos should be disclosed.

When using JAFRA products for the purposes of before-and-after photos, you must only use the JAFRA products and not use any other skincare products, medications, or devices relating to skincare or undergo any other skincare treatments (like wrinkle-reduction injections, chemical peels, etc.). You must only use JAFRA products as directed. If you are not the person being photographed, you must have written permission from the person pictured to use the photos. JAFRA may require you to include a disclaimer informing consumers of the typical results they can expect to achieve, and you must post the disclaimer provided by JAFRA where it will be visible and readable. Upon JAFRA’s request, you must provide JAFRA with a signed declaration that you followed these Guidelines. JAFRA reserves the right to review and approve any material created by you before it is publicly posted or disseminated, or to require you to delete any posts or content. You shall not post or otherwise disseminate any content that has been rejected.

Please send your before-and-after photographs and product reviews /testimonials to: [email protected]

7.3.9 Facials and Demonstration Policy An important part of JAFRA’s direct selling business is that clients have the opportunity to try JAFRA products for themselves before purchasing them. However, Consultants should not touch their clients when giving facials, makeovers, or any type of demonstration or sampling of JAFRA products. There are two main reasons for this. First, such facials or demonstrations may not be legal, as the laws governing the practice of cosmetology vary in different states. Second, from a hygienic and safety standpoint, touching clients could transmit bacteria or other microorganisms causing infection, and certain instruments or products could cause injury or adverse reactions.

Thus, when giving a “facial” or any other type of product demonstration, Consultants should instruct and guide clients in apply JAFRA products themselves. This includes back-of-hand facials, meaning that even if the product is to be applied to the back of the hand, the client should apply the product her/himself. JAFRA recommends that facial products be demonstrated on the back of a client’s hand instead of to the face. Although a client may want a Consultant to apply the product for her/him, JAFRA recommends that the Consultant politely decline, and say that it is important for the client to lear

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