Sheago Cosmetics

POLICIES AND PROCEDURES v1.0

1.0

Introduction

1.1

Mutual Commitment Statement

The Gollman Corporation ("hereafter as "Sheago Cosmetics," the "Company," or just "Sheago") recognizes that in order to develop a long-term and mutually rewarding relationship with its Better Life Consultants ("BLC" or "BLC(s)") and Customers, Sheago Cosmetics and the BLCs must acknowledge and respect the true nature of the relationship and support the Customers.

  1. In the spirit of mutual respect and understanding, Sheago Cosmetics is committed to:
    1. Provide prompt, professional and courteous service and communications to all of its BLCs and Customers;
    2. Provide the highest level of quality products, at fair and reasonable prices;
    3. Exchange or refund the purchase price of any product, service or membership as provided in our Return Policy:
    4. Deliver orders promptly and accurately;
    5. Pay commissions accurately and on a timely basis;
    6. Expedite orders or checks if an error or unreasonable delay occurs;
    7. Roll out new products and programs with BLC input and planning;
    8. Implement changes in the Compensation Plan or Policies and Procedures that affect the BLC with input from the BLCs;
    9. Support, protect and defend the integrity of the Sheago Cosmetics Business Opportunity;
    10. Offer BLCs an opportunity to grow with Sheago Cosmetics with such growth guided by the principles of Servant Leadership.
  2. In return, Sheago Cosmetics expects that its BLCs will:
    1. Conduct themselves in a professional, honest, and considerate manner;
    2. Present Sheago Cosmetics Corporate and product information in an accurate and professional manner;
    3. Present the Compensation Plan and Return Policy in a complete and accurate manner;
    4. Not make exaggerated income claims;
    5. Make reasonable effort(s) to support and train BLCs and Customers in their downline;
    6. Not engage in cross-line recruiting, unhealthy competition or unethical business practices;
    7. Provide positive guidance and training to BLCs and Customers in their downline while exercising caution to avoid interference with other downlines. As such, a BLC is discouraged from providing cross-line training to a BLC or Customer in a different organization without first obtaining consent of the BLC's or Customer's upline leader;
    8. Support, protect, and defend the integrity of the Sheago Cosmetics Business Opportunity;
    9. Accurately complete and submit the BLC Agreement and any requested supporting documentation in a timely manner.

1.2

Sheago Cosmetics Policies and Compensation Plan Incorporated into the BLC Agreement

  1. Throughout these Policies, when the term "Agreement" is used, it collectively refers to the Sheago Cosmetics Agreement, these Policies and Procedures, and the Sheago Cosmetics Compensation Plan.
  2. It is the responsibility of the sponsoring BLC to provide the most current version of these Policies and Procedures (available on the Sheago Cosmetics website) and the Sheago Cosmetics Compensation Plan to each applicant prior to his, her and/or its execution of a BLC Agreement.

1.3

Purpose of Policies

  1. Sheago Cosmetics is a direct sales company that markets products and services through a network of business owners. To clearly define the relationship that exists between BLCs and Sheago Cosmetics, and to explicitly set a standard for acceptable business conduct, Sheago Cosmetics has established these Policies and Procedures.
  2. Sheago Cosmetics BLCs are required to comply with: (i) all of the Terms and Conditions set forth in the BLC Agreement, which Sheago Cosmetics may amend from time to time in its sole discretion; (ii) all federal, state, and/or local laws governing his, her and/or its Sheago Cosmetics business; and (iii) these Policies and Procedures.
  3. Sheago Cosmetics BLCs must review the information in these Policies and Procedures carefully. Should a BLC have any questions regarding a policy or rule, the BLC is encouraged to seek an answer from their Sponsor or any other upline BLC. If further clarification is needed the BLC may contact Sheago Cosmetics Customer Service.

1.4

Changes, Amendments, and Modifications

  1. Because federal, state, and local laws, as well as the business environment, periodically change, Sheago Cosmetics reserves the right to amend the Agreement and the prices in its Sheago Cosmetics Product Price List in its sole and absolute discretion. Notification of amendments shall appear in Official Sheago Cosmetics Materials. This provision does NOT apply to the arbitration clause found in Section 13, which can only be modified via mutual consent.
  2. Any such amendment, change, or modification shall be effective immediately upon notice by one of the following methods:
    1. Posting on the official Sheago Cosmetics website;
    2. Electronic mail (e-mail); or
    3. In writing through the Sheago Cosmetics newsletters or other Sheago Cosmetics communication channels.

1.5

Delays

Sheago Cosmetics shall not be responsible for delays or failures in performance of its obligations when such failure is due to circumstances beyond its reasonable control. This includes, without limitation, strikes, labor difficulties, transportation difficulties, riot, war, fire, and/or weather, curtailment of a source of supply, or government decrees or orders.

1.6

Effective Date

These Policies and Procedures shall become effective as of August 31, 2016 and, at such time, shall automatically supersede any prior Policies and Procedures (the "old Policies and Procedures"), and, on that date, the old Policies and Procedures shall cease to have any force or effect.

2.0

BASIC PRINCIPLES

2.1

Becoming a Sheago Cosmetics Better Life Consultant

  1. To become a Better Life Consultant ("BLC"), an applicant must comply with the following requirements:
    1. Be of the age of majority (not a minor) in his or her state of residence;
    2. Reside or have a valid address in the United States or U.S. territory;
    3. Have a valid taxpayer identification number (i.e. Social Security Number, Federal Tax ID Number, etc.);
    4. Submit a properly completed and signed BLC Agreement to Sheago Cosmetics;
    5. Not be a Sheago Cosmetics employee, the spouse of a Sheago Cosmetics employee or related to an employee of Sheago Cosmetics and living in the same household as such Sheago Cosmetics employee.

2.2

New BLC Registration

  1. A potential new BLC may self-enroll on the Sponsor's website. In such event, instead of a physically signed BLC Agreement, Sheago Cosmetics will accept the Web-enrollment and BLC Agreement by accepting the "electronic signature" stating the new BLC has accepted the Terms and Conditions of such BLC Agreement. Please note that such electronic signature constitutes a legally binding agreement between the BLC and Sheago Cosmetics.
  2. Sheago Cosmetics reserves the right to require signed paperwork for any account, regardless of origin.
  3. If requested the signed BLC Agreement must be received by Sheago Cosmetics within fourteen (14) days of enrollment.
  4. Signed documents, including, but not limited to, BLC personal agreements, are legally binding contracts which must not be altered, tampered with or changed in any manner after they have been signed. False or misleading information, forged signatures or alterations to any document, including business registration forms, made after a document has been signed may lead to sanctions, up to and including involuntary termination of the BLC's business.

2.3

Rights Granted

  1. Sheago Cosmetics hereby grants to the BLC a non-exclusive right, based upon the Terms and Conditions contained in the BLC Agreement and these Policies and Procedures, to:
    1. Purchase Sheago Cosmetics products and services;
    2. Promote and sell Sheago Cosmetics products and services; and
    3. Sponsor new BLCs and Customers in the United States and in countries where Sheago may become established after the effective date of these Policies and Procedures.

2.4

Identification Numbers

  1. Each BLC is required to provide his or her Social Security Number, or Federal Tax Identification Number, if located in the United States or any of its territories, to Sheago Cosmetics on the BLC Agreement. Sheago Cosmetics reserves the right to withhold commission payments from any BLC who fails to provide such information or who provides false information.
  2. Upon enrollment, Sheago Cosmetics will provide a Sheago Cosmetics Identification Number to the BLC. This number will be used to place orders, structure organizations, and track commissions and bonuses.

2.5

Renewals and Expiration of the BLC Agreement

  1. If the BLC allows his or her BLC Agreement to expire due to nonpayment of the renewal fee, the BLC will lose any and all rights to his, her or its downline organization unless the BLC re-activates within sixty (60) days following the expiration of the Agreement. The annual renewal fee is $99 payable on the annual anniversary date in which the BLC joined the Company.
  2. If the former BLC re-activates within the sixty-day time limit, the BLC will resume the rank and position held immediately prior to the expiration of the BLC Agreement. However, such BLC's paid as level will not be restored unless he, she and/or an entity qualifies at that payout level in the new month. The BLC is not eligible to receive commissions for the time period that the BLC's business was expired.
  3. Any BLC who was terminated or who's Agreement has expired and lapsed the sixty-day grace period is not eligible to re-apply for a Sheago Cosmetics business for twelve (12) months following the expiration of the BLC Agreement.
  4. The downline of the expired BLC will roll up to the immediate, active upline Sponsor.

2.6

Business Entities

  1. A corporation, partnership, LLC, or trust (collectively referred to as a "Business Entity") may apply to be a Sheago Cosmetics BLC. This BLC business and position will remain temporary until the proper documents are submitted. The Business Entity must submit one of the following documents: Certificate of Incorporation, Articles of Organization, Partnership Agreement or appropriate Trust documents. Sheago Cosmetics must receive these documents within fourteen (14) days from the date the BLC Agreement was signed.
  2. A Sheago Cosmetics BLC may change their status under the same Sponsor from an individual to a partnership, LLC, corporation, trust or from one type of business entity to another.

2.7

Independent Business Relationship; Indemnification for Actions

  1. The Sheago Cosmetics BLC is an independent contractor, and not a purchaser of a franchise or business opportunity. Therefore, each BLC's success depends on his or her independent efforts.
  2. The Agreement between Sheago Cosmetics and its BLCs does not create an employer/employee relationship, agency, partnership, or joint venture between Sheago Cosmetics and the BLC.
  3. A Sheago Cosmetics BLC shall not be treated as an employee of Sheago Cosmetics for any purposes, including, without limitation, for federal or state tax purposes. All BLCs are responsible for paying local, state, and federal taxes due from all compensation earned as a BLC of Sheago Cosmetics. Any other compensation received by BLCs from Sheago Cosmetics will be governed by applicable U.S. tax laws (or the tax laws of any other applicable jurisdiction). The BLC has no express or implied authority to bind Sheago Cosmetics to any obligation or to make any commitments by or on behalf of Sheago Cosmetics. Each BLC, whether acting as management of a Business Entity or represented as an individual, shall establish his or her own goals, hours, and methods of operation and sale, so long as he or she complies with the Terms of the BLC Agreement, these Policies and Procedures and applicable state and federal laws.
  4. The Sheago Cosmetics BLC is fully responsible for all of his or her verbal and written communications made regarding Sheago Cosmetics products, services, and the Compensation Plan that are not expressly contained within official Sheago Cosmetics materials. BLCs shall indemnify and hold harmless Sheago Cosmetics, its directors, officers, employees, product suppliers and agents from any and against all liability including judgments, civil penalties, refunds, attorney fees and court costs incurred by Sheago Cosmetics as a result of the BLC's unauthorized representations or actions. This Provision shall survive the termination of the Sheago Cosmetics BLC Agreement.

2.8

Insurance

  1. Business Pursuits Coverage. Sheago Cosmetics encourages BLCs to arrange insurance coverage for their business. A homeowner's insurance policy does not cover business related injuries, or the theft of, or damage to, inventory or business equipment. Sheago Cosmetics BLCs need to contact their insurance agent to make certain their business property is protected. In most instances, this may be accomplished with a "Business Pursuit" endorsement to an existing homeowner's policy.

2.9

Errors or Questions

  1. If a BLC has questions about, or believes any errors have been made regarding commissions, bonuses, business reports, orders, or charges, the BLC must notify Sheago Cosmetics in writing within thirty (30) days of the date of the error or incident in question. Any such errors, omissions or problems not reported within thirty days shall be deemed waived by the BLC.

3.0

SHEAGO COSMETICS's IBO RESPONSIBILITIES

3.1

Correct Addresses

  1. It is the responsibility of the BLC or Customer to make sure Sheago Cosmetics has the correct shipping address before any orders are shipped.
  2. A BLC or Customer will need to allow up to thirty (30) days for processing after the notice of address change has been received by Sheago Cosmetics.
  3. A BLC or Customer may be assessed a $20 fee for returned shipments due to an incorrect shipping address.

3.2

Training and Leadership

  1. Any Sheago Cosmetics BLC who Sponsors another BLC into Sheago Cosmetics must perform an authentic assistance and training function to ensure his or her downline is properly operating his or her Sheago Cosmetics business. Sponsoring BLCs should have ongoing contact and communication with the BLCs in their downline organizations. Examples of communication may include, but are not limited to, newsletters, written correspondence, telephone, contact, team calls, voice-mail, e-mail, personal meetings, accompaniment of downline BLCs to Sheago Cosmetics meetings, training sessions and any other related functions.
  2. A Sponsoring Sheago Cosmetics BLC should monitor the BLCs in his or her downline organizations to ensure that downline BLCs do not make improper product or business claims, or engage in any illegal or inappropriate conduct. Upon request, such BLC should be able to provide documented evidence to Sheago Cosmetics of his or her ongoing fulfillment of the responsibilities of a Sponsor.
  3. Upline BLCs are encouraged to motivate and train new BLCs about Sheago Cosmetics products and services, effective sales techniques, the Sheago Cosmetics Compensation Plan and compliance with company Policies and Procedures.
  4. Marketing product is a required activity in Sheago Cosmetics and must be emphasized in all recruiting presentations.
  5. We emphasize and encourage all BLCs to sell Sheago Cosmetics products and services to Customers.
  6. Use of Sales Aids. To promote both the products and the opportunity Sheago Cosmetics offers, BLCs must use the sales aids and support materials produced by Sheago Cosmetics. If Sheago Cosmetics BLCs develop their own sales aids and promotional materials, which includes Internet advertising, notwithstanding BLCs' good intentions, they may unintentionally violate any number of statutes or regulations affecting the Sheago business. These violations, although they may be relatively few in number, could jeopardize the Sheago Cosmetics opportunity for all BLCs. Accordingly, BLCs must submit all written sales aids, promotional materials, advertisements, websites and other literature to the Company for Company's approval prior to use. Unless the BLC receives specific written approval to use the material, the request shall be deemed denied. All BLCs shall safeguard and promote the good reputation of Sheago Cosmetics and its products. The marketing and promotion of Sheago Cosmetics, the Sheago opportunity, the Compensation Plan, and Sheago Cosmetics products and services shall be consistent with the public interest, and must avoid all discourteous, deceptive, misleading, unethical or immoral conduct or practices.

3.3

Constructive Criticism; Ethics

  1. Sheago Cosmetics desires to provide its independent BLCs with the best products and services and Compensation Plan in the industry. Accordingly, Sheago Cosmetics values constructive criticism and encourages the submission of written comments addressed to Sheago Cosmetics Compliance Department.
  2. Negative and disparaging comments about Sheago Cosmetics, its products or Compensation Plan, by BLCs made to Sheago Cosmetics, in the Field or at Sheago Cosmetics meetings or events, or disruptive behavior at Sheago Cosmetics meetings or events, serve no purpose other than to dampen the enthusiasm of other Sheago Cosmetics BLCs. Sheago Cosmetics BLCs must not belittle Sheago Cosmetics, other Sheago Cosmetics BLCs, Sheago Cosmetics products or services, the Compensation Plan, or Sheago Cosmetics directors, officers, or employees, product suppliers or agents. Such conduct represents a material breach of these Policies and Procedures and may be subject to sanctions as deemed appropriate by Sheago Cosmetics.
  3. Sheago Cosmetics endorses the following code of ethics:
    1. A Sheago Cosmetics BLC must show fairness, tolerance, and respect to all people associated with Sheago Cosmetics, regardless of race, gender, social class or religion, thereby fostering a "positive atmosphere" of teamwork, good morale and community spirit.
    2. A BLC shall strive to resolve business issues, including situations with upline and downline BLCs, by emphasizing tact, sensitivity, good will and taking care not to create additional problems.
    3. Sheago Cosmetics BLCs must be honest, responsible, and professional and conduct themselves with integrity.
    4. Sheago Cosmetics BLCs shall not make disparaging statements about Sheago Cosmetics, other BLCs, Sheago Cosmetics employees, product suppliers or agents, products, services, sales and marketing campaigns, or the Compensation Plan, or make statements that unreasonably offend, mislead or coerce others.
  4. Sheago Cosmetics may take appropriate action against a BLC if it determines, in its sole discretion, that a BLC's conduct is detrimental, disruptive, or injurious to Sheago Cosmetics or to other BLCs.

3.4

Reporting Policy Violation

  1. A BLC who observes a policy violation by another BLC should submit a written and signed letter (e-mail will not be accepted) of the violation directly to the Sheago Cosmetics Corporate office. The letter shall set forth the details of the incident as follows:
    1. The nature of the violation;
    2. Specific facts to support the allegations;
    3. Dates;
    4. Number of occurrences;
    5. Persons involved; and
    6. Supporting documentation
  2. Once the matter has been presented to Sheago Cosmetics, it will be researched thoroughly by the Compliance Department and appropriate action will be taken if required.
  3. This section refers to the general reporting of Policy violations as observed by other BLCs for the mutual effort to support, protect, and defend the integrity of the Sheago Cosmetics business and opportunity. If a BLC has a grievance or complaint against another BLC which directly relates to his or her Sheago Cosmetics business, the Procedures set forth in these Policies must be followed.

3.5

Sponsorship

  1. The Sponsor is the person who introduces a BLC or Customer to Sheago Cosmetics, helps them complete their enrollment, and supports and trains those in their downline.
  2. Sheago Cosmetics recognizes the Sponsor as the name(s) shown on the first:
    1. Physically signed Sheago Cosmetics BLC Agreement on file; or
    2. Electronically signed BLC Agreement from a website or a Sheago Cosmetics BLC's website.
  3. A BLC Agreement that contains notations such as "by phone" or the signatures of other individuals (i.e. Sponsors, Spouses, relatives, or friends) is not valid and will not be accepted by Sheago Cosmetics.
  4. Sheago Cosmetics recognizes that each new prospect has the right to ultimately choose his or her own Sponsor, but Sheago Cosmetics will not allow BLCs to engage in unethical sponsoring activities.
  5. All active BLCs in good standing have the right to sponsor and enroll others into Sheago Cosmetics. While engaged in sponsoring activities, it is not uncommon to encounter situations when more than one BLC will approach the same prospect. It is the accepted courtesy that the new prospect will be sponsored by the first BLC who presented a comprehensive introduction to Sheago Cosmetics products or business opportunity.
  6. A Protected Prospect is a guest of any Sheago Cosmetics BLC or Customer who attended a Sheago Cosmetics event or conference call. For sixty (60) days following the event, a Protected Prospect cannot be solicited or sponsored by any other Sheago Cosmetics BLC who attended the same event. A Sheago Cosmetics event can be defined as the following:
    1. Any Sheago Cosmetics training session;
    2. Conference call;
    3. Fly-in meeting; or
    4. Presentation, including but not limited to a Sheago Cosmetics at home presentation, whether sponsored by Sheago Cosmetics, a BLC, a Customer, or an agent or agency designated by Sheago Cosmetics.

3.6

Cross Sponsoring Prohibition

  1. "Cross sponsoring" is defined as the enrollment into a different line of sponsorship of an individual, or Business Entity, that already has a signed BLC Agreement. Actual or attempted cross sponsoring is not allowed. If cross sponsoring is verified by Sheago Cosmetics, sanctions up to and including termination of a BLC's business may be imposed.
  2. The use of a Spouse's or relative's name, trade names, assumed names, DBA names, corporation, partnership, trust, federal ID numbers, or fictitious ID numbers to evade or circumvent this Policy is not permitted.
  3. This Policy does not prohibit the transfer of a Sheago Cosmetics business in accordance with Sheago Cosmetics Sale or Transfer Policy set forth in these Policies.

3.7

Adherence to the Sheago Cosmetics Compensation Plan

  1. A BLC must adhere to the Terms of the Sheago Cosmetics Compensation Plan as set forth in these Policies and Procedures as well as in official Sheago Cosmetics literature. Deviation from the Compensation Plan is prohibited.
  2. A BLC shall not offer the Sheago Cosmetics opportunity through, or in combination with, any other system, program, or method of marketing other than that specifically set forth in official Sheago Cosmetics literature.
  3. A BLC shall not require or encourage a current or prospective Customer or BLC to participate in Sheago Cosmetics in any manner that varies from the Compensation Plan as set forth in official Sheago Cosmetics literature.
  4. A BLC shall not require or encourage a current or prospective Customer or BLC to make a purchase from or payment to any individual or other entity as a condition to participating in the Sheago Cosmetics Compensation Plan, other than such purchases or payments required to naturally build their business.

3.8

Adherence to Laws and Ordinances

  1. Many cities and counties have laws regulating certain home-based businesses. In most cases, these ordinances do not apply to BLCs because of the nature of the business. However, BLCs must check their local laws and obey the laws that do apply to them.
  2. A Sheago Cosmetics BLC shall comply with all federal, state, and local laws and regulations in their conduct of his or her Sheago business.

3.9

Compliance with Applicable Income Tax Laws

  1. Sheago Cosmetics will automatically provide a complete 1099 Miscellaneous Income Tax form (nonemployee compensation) to each US BLC whose earnings for the year is at least $600 or who has purchased more than $5,000 of Sheago Cosmetics products for resale, or who received trips, prizes or awards valued at $600 or more. If earnings and purchases are less than stated above, IRS forms will be sent only at the request of the BLC, and a minimum charge of $20 may be assessed by Sheago Cosmetics.
  2. A BLC accepts sole responsibility for and agrees to pay all federal, state, and local taxes on any income generated as an independent BLC, and further agrees to indemnify Sheago Cosmetics from any failure to pay such tax amounts when due.
  3. If a BLC's business is tax exempt, the Federal Tax Identification number must be provided to Sheago Cosmetics in writing.
  4. Sheago Cosmetics encourages all BLCs to consult with a tax advisor for additional information for their business.

3.10

One Sheago Cosmetics Business per BLC

  1. A BLC may operate or have an ownership interest, legal or equitable, as a sole proprietorship, partner, shareholder, trustee, or beneficiary, in only one (1) Sheago Cosmetics business. No individual may have, operate or receive compensation from more than one Sheago Cosmetics businesses. Individuals of the same family unit may each enter into or have an interest in their own separate Sheago Cosmetics businesses, only if each subsequent family position is placed frontline to the first family member enrolled. A "family unit" is defined as Spouses and dependent children living at or doing business at the same address.

3.11

Actions of Household Members or Affiliated Parties

  1. If any member of a BLC's immediate household engages in any activity which, if performed by the BLC, would violate any provision of the Agreement, such activity will be deemed a violation by the BLC and Sheago Cosmetics may take disciplinary action pursuant to these Policies and Procedures against the BLC. Similarly, if any individual associated in any way with a corporation, partnership, LLC, trust or other entity (collectively "Business Entity") violates the Agreement, such action(s) will be deemed a violation by the Business Entity, and Sheago Cosmetics may take disciplinary action against the Business Entity. Likewise, if a BLC enrolls in Sheago Cosmetics as a Business Entity, each Affiliated Party of the Business Entity shall be personally and individually bound to, and must comply with, the Terms and Conditions of the Agreement.

3.12

Solicitation for Other Companies or Products

  1. A Sheago Cosmetics BLC may participate in other direct sales, multilevel, network marketing or relationship marketing business ventures or marketing opportunities. However, during the Term of this Agreement and for one (1) year thereafter, a Sheago Cosmetics BLC may not recruit any Sheago Cosmetics BLC or Customer for any other direct sales or network marketing business, unless that BLC or Customer was personally sponsored by such BLC.
  2. The term "recruit" means actual or attempted solicitation, enrollment, encouragement, or effort to influence in any other way (either directly or through a third party), another BLC or Customer to enroll or participate in any direct sales or network marketing opportunity. This conduct represents recruiting even if the BLC's actions are in response to an inquiry made by another BLC or Customer.
  3. During the term of this Agreement and for a period of six (6) months thereafter, any Sheago Cosmetics BLC must not sell, or entice others to sell, any competing products or services, including training materials, to Sheago Customers or BLCs. Any product or service in the same category as a Sheago Cosmetics product or service is deemed to be competing (i.e., any competing product or service regardless of differences in cost or quality. This provision does not apply where professional services are the primary source of revenue and the product sales are secondary (e.g., doctor's offices, clinics, health clubs, spas and beauty salons).
  4. However, a BLC may sell non-competing products or services to Sheago Cosmetics Customers and BLCs that they personally sponsored.
  5. A BLC may not display or bundle Sheago Cosmetics products or services, in sales literature, on a website or in sales meetings, with any other products or services to avoid confusing or misleading a prospective Customer or BLC into believing there is a relationship between the Sheago Cosmetics and non-Sheago Cosmetics products and services.
  6. A Sheago Cosmetics BLC may not offer any non-Sheago Cosmetics opportunity, products or services at any Sheago Cosmetics related meeting, seminar or convention, or immediately following a Sheago Cosmetics event.
  7. A violation of any of the provisions in this section shall constitute unreasonable and unwarranted contractual interference between Sheago Cosmetics and its BLCs and would inflict irreparable harm on Sheago Cosmetics. In such event, Sheago Cosmetics may, at its sole discretion, impose any sanction it deems necessary and appropriate against such BLC or such BLC's business including termination, or seek immediate injunctive relief without the necessity of posting a bond.

3.13

Presentation of the Sheago Cosmetics Opportunity

  1. In presenting the Sheago Cosmetics opportunity to potential Customers and BLCs, a BLC is required to comply with the following provisions:
    1. A BLC shall not misquote or omit any significant material fact about the Compensation Plan.
    2. A BLC shall make it clear that the Compensation Plan is based upon sales of Sheago Cosmetics products and services and upon the sponsoring of other BLCs.
    3. A BLC shall make it clear that success can be achieved only through substantial independent efforts.
    4. A Sheago Cosmetics BLC shall not make unauthorized income projections, claims, or guarantees while presenting or discussing the Sheago Cosmetics opportunity or Compensation Plan to prospective BLCs or Customers.
    5. A BLC may not make any claims regarding products or services of any products offered by Sheago, except those contained in official Sheago Cosmetics literature.
    6. A BLC may not use official Sheago Cosmetics material to promote the Sheago Cosmetics business opportunity in any country where Sheago Cosmetics has not established a "presence."
    7. In an effort to conduct best business practices, Sheago Cosmetics has developed the Income Disclosure Statement ("IDS"). The Sheago Cosmetics IDS is designed to convey truthful, timely, and comprehensive information regarding the income that Sheago Cosmetics BLCs earn. In order to accomplish this objective, a copy of the IDS must be presented to all prospective BLCs.

      A copy of the IDS must be presented to a prospective BLC anytime the Compensation Plan is presented or discussed, or any type of income claim or earnings representation is made.

      The terms "income claim" and/or "earnings representation" (collectively "income claim") include; (1) statements of average earnings, (2) statements of non-average earnings, (3) statements of earnings ranges, (4) income testimonials, (5) lifestyle claims, and (6) hypothetical claims. Examples of "statements of non-average earnings" include, "Our number one BLC earned over a million dollars last year" or "Our average ranking BLC makes five thousand per month." An example of a "statement of earnings ranges" is "The monthly income for our higher ranking BLCs is ten thousand dollars on the low end to thirty thousand dollars a month on the high end."

3.14

Sales Requirements are governed by the Compensation Plan

  1. Sheago Cosmetics BLCs may purchase Sheago Cosmetics products and then re-sell them at any price they choose unless otherwise specified by Sheago Cosmetics or by any/its product suppliers on a per product basis. Sheago Cosmetics will provide suggested selling prices. There are no exclusive territories granted to anyone. No franchise fees are applicable to a Sheago Cosmetics business.
  2. The Sheago Cosmetics program is built on sales to the ultimate consumer. Sheago Cosmetics encourages its BLCs to only purchase inventory that they and their family will personally consume, will be used as a sales tool, or will be resold to others for their ultimate consumption. BLCs must never attempt to influence any other BLC to buy more products than they can reasonably use or sell to retail Customers in a month.
  3. Each Sheago Cosmetics BLC commits to personally use, sell, or use in business building at least 70% of every order placed with the Company prior to placing another order, and must be able to certify to such if demanded by the Company or by any regulatory agency. Purchasing product solely for the purpose of collecting bonuses or achieving rank is prohibited. Sheago Cosmetics retains the right to limit the amount of purchases you may make if, in our sole judgment, we believe those purchases are being made solely for qualification purposes instead of for consumption or resale.

4.0

ORDERING

4.1

General Order Policies

  1. "Bonus Buying" is strictly and absolutely prohibited. Bonus Buying includes; (a) the enrollment of individuals or entities without the knowledge of and/or execution of an Agreement by such individuals or Business Entities; (b) the fraudulent enrollment of an individual or entity as a BLC or Customer; (c) the enrollment or attempted enrollment of non-existent individuals or Business Entities as BLCs or Customers ("phantoms"); (d) purchasing Sheago Cosmetics products or services on behalf of another BLC or Customer, or under another BLC's or Customer's ID number, to qualify for commissions or bonuses; (e) purchasing excessive amounts of products or services that cannot reasonably be used or resold in a month; and/or (f) any other mechanism or artifice to qualify for rank advancement, incentives, prizes, commissions, or bonuses that is not driven by bona fide product or service purchases by end user consumers.

    A BLC shall not use another BLC's or Customer's credit card or debit checking account to enroll in Sheago Cosmetics or purchase products or services without the account holder's written permission. Such documentation must be kept by the BLC indefinitely in case Sheago Cosmetics needs to reference this.

  2. Regarding an order with an invalid or incorrect payment, Sheago Cosmetics will attempt to contact the BLC by phone, mail or e-mail in order to obtain another form of payment. If these attempts are unsuccessful after ten (10) business days, the order will be canceled.
  3. If a BLC wants to move an order to another BLC's position, he or she must have prior authorization, of all parties involved. Sheago Cosmetics will charge the BLC a $20 fee for processing.
  4. Prices are subject to change without notice.
  5. A BLC or Customer who is a recipient of a damaged or incorrect order must notify Sheago Cosmetics within thirty (30) calendar days from receipt of the order and follow the Procedures as set forth in these Policies.

4.2

Insufficient Funds

  1. All checks returned for insufficient funds will be re-submitted for payment. A $35 fee will be charged to the account of the BLC or Customer for all returned checks and insufficient funds.
  2. Any outstanding balance owed to Sheago Cosmetics by a BLC or Customer of the BLC from NSF (non-sufficient funds) checks, returned check fees or insufficient fund fees (ACH) will be withheld by Sheago from a BLC's future bonus and commission checks.
  3. All transactions involving returned checks or insufficient funds through ACH or credit card, which are not resolved in a timely manner by the BLC, constitute grounds for disciplinary sanctions.
  4. If a credit card order or automatic debit is declined the first time, the Customer or BLC will be contacted for an alternate form of payment. If payment is declined a second time, the Customer or BLC may be deemed ineligible to purchase Sheago Cosmetics products or services or participate in the monthly auto ship.

4.3

Sales Tax Obligation

  1. The BLC shall comply with all state and local taxes and regulations governing the sale of Sheago Cosmetics products and services.
  2. Sheago Cosmetics will collect and remit sales tax on BLC orders unless a BLC furnishes Sheago Cosmetics with the appropriate Resale Tax Certificate form. When orders are placed with Sheago Cosmetics, sales tax is prepaid based upon the suggested retail price. Sheago Cosmetics will remit the sales tax to the appropriate state, Provincial and local jurisdictions. The BLC may recover the sales tax when he or she makes a sale. Sheago Cosmetics BLCs are responsible for any additional sales taxes due on products marked up and sold at a higher price.
  3. Sheago Cosmetics encourages each BLC to consult with a tax advisor for additional information for his or her business.

5.0

PAYMENT OF COMMISSIONS & BONUSES

5.1

Bonus and Commission Qualifications

  1. A BLC must be active and in compliance with Sheago Cosmetics Policies and Procedures to qualify for bonuses and commissions. So long as a BLC complies with the Terms of the Agreement, Sheago Cosmetics shall pay commissions to such BLC in accordance with the Compensation Plan.
  2. Sheago Cosmetics will not issue a payment to a BLC without the receipt of a completed and signed Sheago Cosmetics BLC Agreement or Electronic Authorization.
  3. Sheago Cosmetics reserves the right to postpone bonus and commission payments until such time the cumulative amount exceeds $25.

5.2

Computation of Commissions and Discrepancies

  1. In order to qualify to receive commissions and bonuses, a BLC must be in good standing and comply with the Terms of the Agreement and these Policies and Procedures. Commissions, bonuses, overrides, and achievement levels are calculated each month.
  2. A Sheago Cosmetics BLC must review his or her monthly statement and bonus/commission reports promptly and report any discrepancies within thirty (30) days of receipt. After the thirty-day "grace period" no additional requests will be considered for commission recalculations.
  3. For additional information on payment of commissions, please review the Compensation Plan.

5.3

Adjustments to Bonuses and Commissions for Returned Products or BLC Memberships.

  1. A BLC receives bonuses and commissions based on the actual sales of products and services to end consumers and to BLCs through product and service purchases. When a product or service is returned to Sheago Cosmetics for a refund from the end consumer or by a BLC, the bonuses and commissions attributable to the returned product or service will be deducted from the BLC who received bonuses or commissions on such sales. Deductions will occur in the month in which the refund is given and continue every pay period thereafter until the bonus/and or commission is recovered.
  2. In the event that a BLC terminates his or her business, and the amounts of the bonuses or commissions attributable to the returned products or services have not yet been fully recovered by Sheago Cosmetics, the remainder of the outstanding balance may be offset against any other amounts that may be owed by Sheago Cosmetics to the terminated BLC.

6.0

SATISFACTION GUARANTEED AND RETURN OF SALES AIDS

Sheago Cosmetics offers a one hundred percent (100%) ninety-day money back guarantee for all Customers. If a Customer purchased a product or service and is not satisfied with the product or service, the Customer may request a refund from their BLC. If you are not 100% satisfied with our products, you may return the items for a refund if neither you nor we have terminated the Agreement and the products or services were purchased within twelve (12) months and remain in resalable condition. The refund shall be ninety percent (90%) of the purchase price. Shipping and handling charges incurred will not be refunded.

Upon cancellation of the Agreement, the BLC may return all generic sales aids purchased within one (1) year from the date of cancellation for a refund if he or she is unable to sell or use the merchandise. A BLC may only return sales aids he or she personally purchased from the Company under his or her BLC Identification Number, and which are in Resalable condition. Any custom orders of printed sales aids (i.e. business cards, brochures, etc.) whereon the BLC's contact information is imbedded or hard printed, or has been added by the BLC, are not able to be returned in resalable condition thus are nonrefundable. Upon Sheago Cosmetics receipt of the products and sales aids, the BLC will be reimbursed ninety percent (90%) of the net cost of the original purchase price(s), less shipping and handling charges. If the purchases were made through a credit card, the refund will be credited back to the same credit card account. The Company shall deduct from the reimbursement paid to the BLC any commissions, bonuses, rebates or other incentives received by the BLC which were associated with the merchandise that is returned.

6.1

Return Process

  1. All returns, whether by a Customer, or BLC, must be made as follows:
    1. Obtain Return Merchandise Authorization ("RMA") from Sheago Cosmetics;
    2. Ship items to the address provided by Sheago Cosmetics Customer service when you are given your RMA.
    3. Provide a copy of the invoice with the returned products or service. Such invoice must reference the RMA and include the reason for the return.
    4. Ship back product in manufacturer's box exactly as it was delivered.
  2. All returns must be shipped to Sheago Cosmetics pre-paid, as Sheago does not accept shipping collect packages. Sheago Cosmetics recommends shipping returned product by UPS or FedEx with tracking and insurance as risk of loss or damage in shipping of the returned product shall be borne solely by the Customer, or BLC. If returned product is not received at Sheago Cosmetics Distribution Center, it is the responsibility of the Customer, or BLC to trace the shipment and no credit will be applied.
  3. The return of $500 or more of products accompanied by a request for a refund within a calendar year, by a BLC, may constitute grounds for involuntary termination.

7.0

PRIVACY POLICY

7.1

Introduction

This Privacy Policy is to ensure that all Customers and BLCs understand and adhere to the basic principles of confidentiality.

7.2

Expectation of Privacy

  1. Sheago Cosmetics recognizes and respects the importance its Customers and BLCs place on the privacy of their financial and personal information. Sheago Cosmetics will make reasonable efforts to safeguard the privacy of, and maintain the confidentiality of its Customers' and BLCs' financial and account information and nonpublic personal information.
  2. By entering into the BLC Agreement, a BLC authorizes Sheago Cosmetics to disclose his or her name and contact information to upline BLCs solely for activities related to the furtherance of the Sheago Cosmetics business. A BLC hereby agrees to maintain the confidentiality and security of such information and to use it solely for the purpose of supporting and servicing his or her downline organization and conducting the Sheago Cosmetics business.

7.3

Employee Access to Information

Sheago Cosmetics limits the number of employees who have access to Customer's and BLCs' nonpublic personal information.

7.4

Restrictions on the Disclosure of Account Information

  1. Sheago Cosmetics will not share non-public personal information or financial information about current or former Customers or BLCs with third parties, except as permitted or required by laws and regulations, court orders, or to serve the Customers', or BLCs' interests or to enforce its rights or obligations under these Policies and Procedures, or BLC's Agreement or with written permission from the accountholder on file.

8.0

PROPRIETARY INFORMATION AND TRADE SECRETS

8.1

Business Reports, Lists, and Proprietary Information

  1. By completing and signing the Sheago Cosmetics BLC Agreement, the BLC acknowledges that Business Reports, lists of Customer and BLC names and contact information and any other information, which contain financial, scientific or other information both written or otherwise circulated by Sheago Cosmetics pertaining to the business of Sheago Cosmetics (collectively, "Reports"), are confidential and proprietary information and trade secrets belonging to Sheago Cosmetics.

8.2

Obligation of Confidentiality

  1. During the Term of the Sheago Cosmetics BLC Agreement and for a period of five (5) years after the termination or expiration of the BLC Agreement between the BLC and Sheago Cosmetics, the BLC shall not;
    1. Use the information in the Reports to compete with Sheago Cosmetics or for any purpose other than promoting his or her Sheago Cosmetics business;
    2. Use or disclose to any person or entity any confidential information contained in the Reports, including the replication of the genealogy in another network marketing company.

8.3

Breach and Remedies

  1. The BLC acknowledges that such proprietary information is of such character as to render it unique and that disclosure or use thereof in violation of this provision will result in irreparable damage to Sheago Cosmetics and to independent Sheago Cosmetics businesses. Sheago Cosmetics and its BLCs will be entitled to injunctive relief or to recover damages against any BLC who violates this provision in any action to enforce its rights under this section. The prevailing party shall be entitled to an award of attorney's fees, court costs and expenses.

8.4

Return of Materials

  1. Upon demand by Sheago Cosmetics, any current or former BLC will return the original and all copies of all "Reports" to Sheago Cosmetics together with any Sheago Cosmetics confidential information in such person's possession.

9.0

ADVERTISING, PROMOTIONAL MATERIAL, USE OF COMPANY NAMES AND TRADEMARKS

9.1

Labeling, Packaging, and Displaying Products

  1. A Sheago Cosmetics BLC may not re-label, re-package, refill, or alter labels of any Sheago product or service information, materials or program(s) in any way. Sheago Cosmetics products and services must only be sold in their original containers from Sheago Cosmetics. Such re-labeling or re-packaging violates Federal, and State and Provincial laws, which may result in criminal or civil penalties or liability.
  2. A Sheago Cosmetics BLC shall not cause any Sheago Cosmetics product or service or any Sheago Cosmetics trade name to be sold or displayed in retail establishments except:
    1. Where professional services are the primary source of revenue and the product sales are secondary (e.g., doctor's offices, clinics, health clubs, spas and beauty salons);
    2. Where the retail establishment is owned or managed by the BLC and the store does not exceed $1 million in annual gross revenue, and there are five (5) or fewer stores under common ownership of management.
  3. Sheago Cosmetics will permit BLCs to solicit and make Commercial Sales upon prior written approval from Sheago Cosmetics. For the purpose of these Policies and Procedures, the term "Commercial Sale" means the sale of:
    1. Sheago Cosmetics products that equal or exceed $5,000 in a single order;
    2. Products sold to a third party who intends to resell the products to an end consumer.
  4. A BLC may sell Sheago Cosmetics products and services and display the Sheago Cosmetics trade name at any appropriate display booth (such as trade shows) upon prior written approval from Sheago Cosmetics.
  5. Sheago Cosmetics reserves the right to refuse authorization to participate at any function that it does not deem a suitable forum for the promotion of its products and services, or the Sheago Cosmetics opportunity.

9.2

Use of Company Names and Protected Materials

  1. A Sheago Cosmetics Better Life Consultant must safeguard and promote the good reputation of Sheago Cosmetics and the products and services it markets. The marketing and promotion of Sheago Cosmetics, the Sheago Cosmetics opportunity, the Compensation Plan, and Sheago Cosmetics products and services will be consistent with the public interest, and must avoid all discourteous, deceptive, misleading, unethical or immoral conduct and practices.
  2. All promotional materials supplied or created by Sheago Cosmetics must be used in their original form and cannot be changed, amended or altered except with prior written approval from the Sheago Cosmetics Compliance Department.
  3. The name of Sheago Cosmetics, each of its product and service names and other names that have been adopted by Sheago Cosmetics in connection with its business are proprietary trade names, trademarks and service marks of Sheago Cosmetics. As such, these marks are of great value to Sheago Cosmetics and are supplied to BLCs for their use only in an expressly authorized manner.
  4. A Sheago Cosmetics BLC's use of the name "Sheago Cosmetics" is restricted to protect Sheago Cosmetics proprietary rights, ensuring that the Sheago Cosmetics protected names will not be lost or compromised by unauthorized use. Use of the Sheago Cosmetics name on any item not produced by Sheago Cosmetics is prohibited except as follows:
    1. [BLC's name] Sheago Cosmetics BLC
    2. [BLC's name] BLC of Sheago Cosmetics products and services.
  5. Further procedures relating to the use of the Sheago Cosmetics name are as follows:
    1. All stationary (i.e. letterhead, envelopes, and business cards) bearing the Sheago Cosmetics name or logo intended for use by the BLC must be approved in writing by the Sheago Cosmetics Compliance Department.
    2. Sheago Cosmetics BLCs may list "Sheago Cosmetics BLC" or just "BLC" in the white pages of the telephone directory under his or her own name.
    3. Sheago Cosmetics BLCs may not use the name Sheago Cosmetics or Sheago Cosmetics in answering his or her telephone, creating a voice message or using an answering service, such as to give the impression to the caller that they have reached the corporate office. They may state, "Sheago Cosmetics BLC."
  6. Certain photos and graphic images used by Sheago Cosmetics in its advertising, packaging, and websites are the result of paid contracts with outside vendors that do not extend to BLCs. If a BLC wants to use these photos or graphic images, they must negotiate individual contracts with the vendors for a fee.
  7. A Sheago Cosmetics BLC shall not appear on or make use of television or radio, or make use of any other media to promote or discuss Sheago Cosmetics or its programs, products or services without prior written permission from the Sheago Cosmetics Compliance Department.
  8. A BLC may not produce for sale or distribution any Company event or speech, nor may a BLC reproduce Sheago Cosmetics audio or video clips for sale or for personal use without prior written permission from the Sheago Cosmetics Compliance Department.
  9. Sheago Cosmetics reserves the right to rescind its prior approval of any sales aid or promotional material to comply with changing laws and regulations and may request the removal from the marketplace of such materials without financial obligation to the affected BLC.
  10. A BLC shall not promote non-Sheago Cosmetics products or services in conjunction with Sheago Cosmetics products or services on the same websites or same advertisement without prior approval from Sheago Cosmetics Compliance.
  11. Claims (which include personal testimonials) as to therapeutic, curative or beneficial properties of any products offered by Sheago Cosmetics may not be made except those contained in official Sheago Cosmetics literature. In particular, no BLC may make any claim that Sheago Cosmetics 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 Sheago Cosmetics policies, but also they potentially violate federal and state laws and regulations, including the federal Food, Drug, and Cosmetic Act and Federal Trade Commission Act.

9.3

E-mail Limitations

  1. Except as provided in this section, a BLC may not use or transmit unsolicited email, mass email distribution, or "spamming" that advertises or promotes the operation of his or her Sheago Cosmetics business. The exceptions are:
    1. E-mailing any person who has given prior permission or invitation;
    2. E-mailing any person with whom the BLC has established a prior business or personal relationship.
  2. In all states where prohibited by law, a BLC may not transmit, or cause to be transmitted through a third party, (by telephone, facsimile, computer or other device), an unsolicited advertisement to any equipment, which has the capacity to transcribe text or images from an electronic signal received over a regular telephone line, cable line, ISDN, T1 or any other signal carrying device, except as set forth in this section.
  3. All e-mail or computer broadcasted documents subject to this provision shall include each of the following:
    1. A clear and obvious identification that the e-mail message is an advertisement or solicitation. The words "advertisement" or "solicitation" should appear in the subject line of the message;
    2. A clear return path or routing information;
    3. The use of legal and proper domain name;
    4. A clear and obvious notice of the opportunity to decline to receive further commercial e-mail messages from the sender;
    5. Unsubscribe or opt-out instructions should be the very first text in the body of the message box in the same size text as the majority of the message;
    6. The true and correct name of the sender, valid senders e-mail address, and a valid sender physical address;
    7. The date and time of the transmission;
    8. Upon notification by recipient of his or her request not to receive further e-mailed documents, a Sheago Cosmetics BLC shall not transmit any further documents to that recipient.
  4. All e-mail or computer broadcasted documents subject to this provision shall not include any of the following:
    1. Use of any third party domain name without permission;
    2. Sexually explicit materials.

9.4

Internet and Third-Party Website Restrictions

  1. A BLC may not use or attempt to register any of Sheago Cosmetics's trade names, trademarks, service names, service marks, product names, URLs, advertising phrases, the Company's name or any derivative thereof, for any purpose including, but not limited to, Internet domain names (URL), third party websites, e-mail addresses, web pages, or blogs.
  2. B. A Sheago Cosmetics BLC may not sell Sheago Cosmetics products, services or offer the Business Opportunity using "online auctions," such as eBay®.
  3. C. All BLCs may have one (1) approved third-party website. A third-party website is a Sheago Cosmetics-approved personal website that is hosted on non-Sheago Cosmetics servers and has no affiliation with Sheago Cosmetics. Any BLC who wishes to develop their own third-party website must submit a properly completed third-party website Application and Agreement along with the proper Website registration fee and receive Sheago Cosmetics's prior written approval before going live with their third-party website. Third-party websites may be used to promote your business and Sheago Cosmetics's products so long as the third-party website adheres to Sheago Cosmetics's advertising policies. Moreover, no orders may be placed through third-party websites, and no enrollments may occur through a third-party website. If you wish to use any third-party website, you must do the following:
    1. Identify yourself as a BLC for Sheago Cosmetics;
    2. Use only the approved images and wording authorized by Sheago Cosmetics;
    3. Adhere to the branding, trademark, and image usage policies described in this document.
    4. Adhere to any other provision regarding the use of a third-party website described in this document;
    5. Agree to give the Compliance Department at Sheago Cosmetics access to the third-party website and, if the website is password protected, the Compliance Department must receive passwords or credentials allowing unlimited access.
    6. Agree to modify your website to comply with current or future Sheago Cosmetics policies.
  4. All marketing materials used on a BLC's third-party website must be provided by Sheago or approved in writing by Sheago.
  5. To avoid confusion, the following three elements must also be prominently displayed at the top of every page of your third-party website:
    1. The Sheago Cosmetics BLC Logo
    2. Your Name and Title
    3. Sheago Cosmetics Corporate Website Redirect Button
  6. A BLC may not use third-party sites that contain materials copied from corporate sources (such as Sheago Cosmetics brochures, CDs, videos, tapes, events, presentations, and corporate websites). This Policy ensures brand consistency, allows Customers and BLCs to stay up-to-date with changing products, services and information, facilitates enrollment under the correct Sponsor, and assists in compliance with government regulations.
  7. A Sheago BLC who currently qualifies at the rank of [INSERT RANK] may apply to the Compliance Department for an exception to the third-party website policy. To qualify for an exception, the website must serve a unique market that the Sheago Cosmetics corporate site does not currently serve or intend to serve.
  8. Sheago Cosmetics products may be displayed with other products or services on a BLC's third-party website so long as the other products and services are consistent with Sheago Cosmetics values and are not marketed or sold by a competing network-marketing company.
  9. If the independent Sheago Cosmetics business of a BLC who has received authorization to create and post an third-party website is voluntarily or involuntarily canceled for any reason, or if Sheago Cosmetics revokes its authorization allowing the BLC to maintain a third-party website, the BLC shall assign the URL to his/her third-party website to the Sheago Cosmetics within three (3) days from the date of the cancellation and/or re-direct all traffic to the site as directed by the Sheago Cosmetics. Sheago Cosmetics reserves the right to revoke any BLC's right to use a third-party website at any time if Sheago Cosmetics believes that such revocation is in the best interest of Sheago Cosmetics, its BLCs, and Customers. Decisions and corrective actions in this area are at Sheago Cosmetics's sole discretion.
  10. Social Media sites may not be used to sell or offer to sell Sheago Cosmetics products or services. PROFILES A BLC GENERATES IN ANY SOCIAL COMMUNITY WHERE SHEAGO COSMETICS IS DISCUSSED OR MENTIONED MUST CLEARLY IDENTIFY THE BLC AS A SHEAGO COSMETICS BLC, and when a BLC participates in those communities, BLCs must avoid inappropriate conversations, comments, images, video, audio, applications or any other adult, profane, discriminatory or vulgar content. The determination of what is inappropriate is at Sheago Cosmetics's sole discretion, and offending BLCs will be subject to disciplinary action. Banner ads and images used on these sites must be current and must come from the Sheago Cosmetics approved library. If a link is provided, it must link to the posting BLC's Replicated website or an approved third-party website.
  11. Anonymous postings or use of an alias on any Social Media site is prohibited, and offending BLCs will be subject to disciplinary action.
  12. BLCs may not use blog spam, spamdexing or any other mass-replicated methods to leave blog comments. Comments BLCs create or leave must be useful, unique, relevant and specific to the blog's article.
  13. BLCs must disclose their full name on all Social Media postings, and conspicuously identify themselves as an independent BLC for Sheago Cosmetics. Anonymous postings or use of an alias is prohibited.
  14. Postings that are false, misleading, or deceptive are prohibited. This includes, but is not limited to, false or deceptive postings relating to the Sheago Cosmetics income opportunity, Sheago Cosmetics's products and services, and/or your biographical information and credentials.
  15. BLCs are personally responsible for their postings and all other online activity that relates to Sheago Cosmetics. Therefore, even if a BLC does not own or operate a blog or Social Media site, if a BLC posts to any such site that relates to Sheago Cosmetics or which can be traced to Sheago Cosmetics, the BLC is responsible for the posting. BLCs are also responsible for postings which occur on any blog or Social Media site that the BLC owns, operates, or controls.
  16. As a Sheago Cosmetics BLC, it is important to not converse with any person who places a negative post against you, other BLCs, or Sheago Cosmetics. Report negative posts to Sheago Cosmetics at customerservice@sheago.com. responding to such negative posts often simply fuels a discussion with someone carrying a grudge that does not hold themselves to the same high standards as Sheago Cosmetics, and therefore damages the reputation and goodwill of Sheago Cosmetics.
  17. The distinction between a Social Media site and a website may not be clear-cut, because some Social Media sites are particularly robust, Sheago Cosmetics therefore reserves the sole and exclusive right to classify certain Social Media sites as third-party websites and require that BLCs using, or who wish to use, such sites adhere to the Sheago Cosmetics' policies relating to third-party websites.
  18. If your Sheago Cosmetics business is cancelled for any reason, you must discontinue using the Sheago Cosmetics name, and all of Sheago Cosmetics's trademarks, trade names, service marks, and other intellectual property, and all derivatives of such marks and intellectual property, in any postings and all Social Media sites that you utilize. If you post on any Social Media site on which you have previously identified yourself as an independent Sheago Cosmetics BLC, you must conspicuously disclose that you are no longer an independent Sheago Cosmetics BLC.
  19. Failure to comply with these Policies for conducting business online may result in the BLC losing their right to advertise and market Sheago Cosmetics products, services and Sheago Cosmetics's business opportunity online in addition to any other disciplinary action available under the Policies and Procedures.

9.5

Advertising and Promotional Materials

  1. You may not advertise any Sheago Cosmetics products or services at a price LESS than the highest company published, established retail price of ONE offering of the Sheago Cosmetics product or service plus shipping, handling and applicable taxes. No special enticement advertising is allowed. This includes, but is not limited to, offers of free membership, free shipping, or other such offers that grant advantages beyond those available through the Company.
  2. Advertising and all forms of communications must adhere to principles of honesty and propriety.
  3. All advertising, including, but not limited to, print, Internet, computer bulletin boards, television, radio, etc., are subject to prior written approval by the Sheago Compliance Department.
  4. All requests for approvals with respect to advertising must be directed in writing to the Sheago Cosmetics Compliance Department.
  5. Sheago Cosmetics approval is not required to place blind ads that do not mention Sheago Cosmetics, its employees, any of its products, services, designs, symbols, programs, and trademarked, copyrighted, or otherwise protected materials.
  6. A BLC who is currently paid at the [INSERT RANK] rank may create his or her own ads or promotional materials including the development of commercials, infomercials and additional third-party websites. However, all such materials, and any subsequent changes thereto shall be submitted to the Sheago Cosmetics Compliance Department for approval.
  7. [INSERT RANK] are encouraged to work with the Compliance Department prior to the production of commercials, infomercials, or websites.
  8. Sheago Cosmetics reserves the right to rescind its prior approval of submitted advertising or promotional materials in order to comply with changing laws and regulations, and may require the removal of such advertisements from the marketplace without obligation to the affected BLC.

9.6

Testimonial Permission

  1. By signing the Sheago Cosmetics BLC Agreement, a BLC gives Sheago Cosmetics permission to use his or her testimonial or image and likeness in corporate sales materials, including but not limited to print media, electronic media, audio and video. In consideration of being allowed to participate in the Sheago Cosmetics Business Opportunity, a BLC waives any right to be compensated for the use of his or her testimonial or image and likeness even though Sheago Cosmetics may be paid for items or sales materials containing such image and likeness. In some cases, a BLC's testimonial may appear in another BLC's advertising materials. If a BLC does not wish to participate in Sheago Cosmetics sales and marketing materials, he or she should provide a written notice to the Sheago Cosmetics Compliance Department to ensure that his or her testimonial or image and likeness will not be used in any corporate materials, corporate recognition pieces, advertising or recordings of annual events.

9.7

Telemarketing - Limitations

  1. A Sheago Cosmetics BLC must not engage in telemarketing in relation to the operation of the BLC's Sheago Cosmetics business. The term "telemarketing" means the placing of one or more telephone calls to an individual or entity to induce the purchase of Sheago Cosmetics products or services, or to recruit them for the Sheago Cosmetics opportunity.
  2. The Federal Trade Commission ("FTC") and the Federal Communications Commission ("FCC") each have laws that restrict telemarketing practices. Both Federal agencies, as well as a number of States have "do not call" regulations as part of their telemarketing laws.
  3. While a BLC may not consider himself or herself a "telemarketer" in the traditional sense, these regulations broadly define the term "telemarketer" and "telemarketing" so that the unintentional action of calling someone whose telephone number is listed on the Federal "Do Not Call" registry could cause the BLC to violate the law. These regulations must not be taken lightly, as they carry significant penalties (up to $11,000 per violation).
  4. "Cold calls" or "state-to-state calls" made to prospective Customers or BLCs that promote either Sheago Cosmetics products, services or the Sheago Cosmetics opportunity is considered telemarketing and is prohibited.
  5. Exceptions to Telemarketing Regulations

    A Sheago Cosmetics BLC may place telephone calls to prospective Customers, or BLCs under the following limited situations:

    1. If the BLC has an established business relationship with the prospect;
    2. In response to the prospect's personal inquiry or application regarding a product or service offered by the Sheago Cosmetics BLC, within three (3) months immediately before the date of such a call;
    3. If the BLC receives written and signed permission from the prospect authorizing the BLC to call;
    4. If the call is to family members, personal friends, and acquaintances. However, if a BLC makes a habit of collecting business cards from everyone he/she meets and subsequently calls them, the FTC may consider this a form of telemarketing that is not subject to this exemption;
    5. Sheago Cosmetics BLCs engaged in calling "acquaintances," must make such calls on an occasional basis only and not as a routine practice.
  6. A BLC shall not use automatic telephone dialing systems in the operation of his or her Sheago Cosmetics businesses.
  7. Failure to abide by Sheago Cosmetics policies or regulations as set forth by the FTC and FCC regarding telemarketing may lead to sanctions against the BLC's business, up to and including termination of the business.
  8. By signing the BLC Agreement, or by accepting commission checks, other payments or awards from Sheago Cosmetics, a BLC gives permission to Sheago Cosmetics and other BLCs to contact them as permitted under the Federal Do Not Call regulations.
  9. In the event a BLC violates this section, Sheago Cosmetics reserves the right to institute legal proceedings to obtain monetary or equitable relief.

10.0

INTERNATIONAL MARKETING

10.1

International Marketing Policy

  1. A Sheago Cosmetics BLC is authorized to sell Sheago Cosmetics products and services, to Customers and BLCs only in the countries in which Sheago Cosmetics is authorized to conduct business, according to the Policies and Procedures of each country. Sheago Cosmetics BLCs may not sell products or services in any country where Sheago Cosmetics products and services have not received applicable government authorization or approval.
  2. A BLC may not, in any unauthorized country, conduct sales, enrollment or training meetings, enroll or attempt to enroll potential Customers or BLCs, nor conduct any other activity for the purpose of selling Sheago Cosmetics products and services, establishing a sales organization, or promoting the Sheago Cosmetics business opportunity.

11

CHANGES TO A BLC BUSINESS

11.1

Modification of the BLC Agreement

  1. A Sheago BLC may modify his or her existing BLC Agreement (i.e., change a social security number to a Federal ID number, add a Spouse or partner to the account, or change the form of ownership from an individual to a Business Entity owned by the BLC) by submitting a written request, accompanied by a new BLC Agreement and the Business Registration Form, if applicable, completed with fresh signatures (not a "crossed out" or "white-out" version of the first Agreement), and any appropriate supporting documentation.

11.2

Change Sponsor or Placement for Active BLCs

  1. Maintaining the integrity of the organizational structure is mandatory for the success of Sheago Cosmetics and our independent BLCs. As such, under exceptional circumstances at the discretion of the Company, a request to change placement may only be made within the first 30 days of initial enrollment as a BLC. Furthermore, such changes may only occur within the same organization.
  2. Sponsors may make "Placement changes" from one BLC to another for personally Sponsored (frontline) BLCs during the first 30 days of enrollment.
  3. New BLCs or their original Sponsor may request a change of Sponsor or Placement within the first 30 days of enrollment for the purpose of structuring an organization. The new BLC Agreement must be received within the calendar month for commission calculations to be effective with the requested change.
  4. To change or correct the Sponsor, a BLC must comply with following procedures:
    1. Submit a Sponsor Placement Transfer Form;
    2. Submit a Sheago Cosmetics BLC Agreement showing the correct Sponsor and Placement, and any appropriate supporting documentation;
    3. The BLC Agreement must be a new, completed document bearing "fresh" signatures, not a "crossed-out" or "white-out" version of the first Agreement.
  5. Upon approval, the BLC's downline, if any, will transfer with the BLC.
  6. If one transfer has already been made a $20 fee will be assessed for the second and for each transfer thereafter.
  7. After the first 30 days from initial enrollment, Sheago Cosmetics will honor the Sponsor/Placement as shown:
    1. On the most recently signed BLC Agreement on file; or
    2. Self-enrolled on the website (i.e., electronically signed Web Agreement).
  8. Sheago retains the right to approve or deny any requests to change Sponsor or Placement, and to correct any errors related thereto at any time and in whatever manner it deems necessary.

11.3

Change Sponsor or Placement for Inactive BLCs

  1. At the discretion of Sheago Cosmetics, BLCs who did not participate in an auto ship or have not ordered products or services for at least twelve (12) months, and who have not tendered a letter of resignation, are eligible to re-enroll in Sheago Cosmetics under the Sponsor/Placement of their choice.
  2. Upon written notice to Sheago Cosmetics that a former BLC wishes to re-enroll, Sheago Cosmetics will "compress" (close) the original account. A new Sheago Cosmetics ID number will then be issued to the former BLC.
  3. Such BLC does not retain former rank, downline, or rights to commission checks from his or her former organizations.
  4. Sheago Cosmetics reserves the right to correct Sponsor or Placement errors at any time and in whatever manner it deems necessary.

11.4

Change Organizations

  1. If a Sheago Cosmetics BLC wishes to transfer organizations, he or she must submit a letter of resignation to the Sheago Cosmetics Customer Service Department and remain inactive (place no orders, or be on an auto ship) with or in Sheago Cosmetics for six (6) months from the receipt of the letter before being eligible to re-enroll under a different Sponsor/Placement.
  2. Sheago Cosmetics retains the right to approve or deny any request to re-enroll after a BLC's resignation.
  3. If re-enrollment is approved, the former BLC will be issued a new Sheago Cosmetics ID number and will be required to submit a new BLC Agreement. The BLC will not be entitled to keep any former rank, downline, or rights to commission checks from any prior organization.
  4. Transfers may not be done outside of the original organization.

11.5

Unethical Sponsoring

  1. Unethical sponsoring activities include, but are not limited to, enticing, bidding or engaging in unhealthy competition in trying to acquire a prospect or new BLC from another BLC or influencing another BLC to transfer to a different sponsor.
  2. B. Allegations of unethical sponsoring must be reported in writing to the Sheago Cosmetics Compliance Department within the first 90 days of enrollment. If the reports are substantiated, Sheago Cosmetics may transfer the BLC or the BLC's downline to another sponsor, Placement or organization without approval from the current up-line Sponsor or Placement BLCs. Sheago Cosmetics remains the final authority in such cases.
  3. C. Sheago Cosmetics prohibits the act of "Stacking." Stacking is the unauthorized manipulation of the Sheago Cosmetics compensation system and/or the marketing plan in order to trigger commissions or cause a promotion off a downline BLC in an unearned manner. One example of stacking occurs when a Sponsor places participants under an inactive downline without his or her knowledge in order to trigger unearned qualification for commissioning. Stacking is unethical and unacceptable behavior, and as such, it is a punishable offense with measures up to and including the termination of the independent consultant positions of all individuals and/or entities found to be directly involved.
  4. D. Should BLCs engage in solicitation and/or enticement of members of another direct sales company to sell or distribute Sheago Cosmetics products and services to, they bear the risk of being sued by the other direct sales company. If any lawsuit, arbitration, or mediation is brought against a BLC alleging that they engaged in inappropriate recruiting activity of another company's sales force or Customers, Sheago Cosmetics will not pay any of BLC's defence costs or legal fees, nor will Sheago Cosmetics indemnify the BLC for any judgment, award, or settlement.

11.6

Sell, Assign or Delegate Ownership

  1. In order to preserve the integrity of the hierarchical structure, it is necessary for Sheago Cosmetics to place restrictions on the transfer, assignment, or sale of a business.
  2. A Sheago Cosmetics BLC may not sell or assign his or her rights or delegate his or her position as a BLC without prior written approval by Sheago Cosmetics, which approval will not be unreasonably withheld. Any attempted sale, assignment, or delegation without such approval may be voided at the discretion of Sheago Cosmetics.
  3. Should the sale be approved by Sheago Cosmetics, the Buyer assumes the position of the Seller at the current qualified title, but at the current "paid as" rank, at the time of the sale and acquires the Seller's Downline.
  4. To request corporate authorization for a sale or transfer of a Sheago Cosmetics business, the following items must be submitted to the Sheago Cosmetics Compliance Department:
    1. A Sale/Transfer Form properly completed, with the requisite signatures.
    2. A copy of the Sales Agreement signed and dated by both Buyer and Seller.
    3. A Sheago Cosmetics BLC Agreement completed and signed by the Buyer;
    4. Payment of the $100 administration fee;
    5. Any additional supporting documentation requested by Sheago Cosmetics.
  5. Any debt obligations that either Seller or Buyer may have with Sheago Cosmetics must be satisfied prior to the approval of the sale or transfer by Sheago Cosmetics.
  6. A Sheago Cosmetics BLC who sells his or her business is not eligible to re-enroll as a Sheago BLC in any organization for six (6) full calendar months following the date of the sale except as otherwise expressly set forth in these Policies and Procedures.

11.7

Separating a Sheago Cosmetics Business

  1. Pending a divorce or dissolution of a partnership or other business entity, the parties must adopt one of the following methods of operation:
    1. One of the parties may, with the written consent of the other(s), operate the Sheago Cosmetics business whereby the relinquishing Spouse, shareholders, partners, members or trustees authorize Sheago Cosmetics to deal directly and solely with the other Spouse, non-relinquishing shareholder, partner, member or trustee; and
    2. The parties may continue to operate the Sheago Cosmetics business jointly on a "business as usual" basis, whereupon all compensation paid by Sheago Cosmetics will be paid in the name designated as the BLCs or in the name of the entity to be divided, as the parties may independently agree between them. If no name is stipulated, Sheago Cosmetics will pay compensation to the name on record and in such event, the BLC named on the account shall indemnify Sheago Cosmetics from any claims from the other business owner(s) or the other Spouse with respect to such payment.
  2. Sheago Cosmetics recognizes only one Downline organization and will issue only one commission check per Sheago Cosmetics business per commission cycle. Under no circumstances will the Downline of an organization be divided, nor will Sheago Cosmetics split commission and/or bonus checks.
  3. If a relinquishing Spouse, partner or owner of the business has completely relinquished ("Relinquishing Party"), in writing, all rights to the original Sheago Cosmetics business, he or she may immediately thereafter re-enroll under the Sponsor and Placement of his or her choice. In such cases, however, the Relinquishing Party shall have no rights to, and shall not solicit, any BLC or active Customer in the former organization, and must develop a new business in the same manner as any other new Sheago Cosmetics BLC. A BLC in the Relinquishing Party's former Downline who wishes to transfer to the Relinquishing Party's new organization or to any other organization, must comply with the requirements in Section 13.5.

11.8

Succession

  1. Upon the death or incapacity of a BLC, the BLC's business may be passed on to his or her legal successors in interest (successor). Whenever a Sheago Cosmetics business is transferred by will or other testamentary process, the successor acquires the right to collect all bonuses and commissions of the deceased BLC's sales organization. The successor must:
    1. Complete and sign a new Sheago Cosmetics BLC Agreement;
    2. Comply with the Terms and provisions of the BLC Agreement; and
    3. Meet all of the qualifications for the last rank achieved by the former BLC.
  2. Bonus and commission checks of a Sheago Cosmetics business transferred based on this section will be paid in a single check to the successor. The successor must provide Sheago Cosmetics with an "address of record" to which all bonus and commission Payments will be sent. Payments will be based on the current performance of the business, not the highest rank or volume achieved.
  3. If the business is bequeathed to joint devisees (successors), they must form a business entity and acquire a Federal taxpayer identification number. Sheago Cosmetics will issue all bonus and commission payments and one 1099 Miscellaneous Income Tax form to the managing business entity only.
  4. Appropriate legal documentation must be submitted to Sheago Cosmetics Compliance Department to ensure the transfer is done properly. To affect a testamentary transfer of a Sheago Cosmetics business, the successor must provide the following to Sheago Cosmetics Compliance Department:
    1. A certified copy of the death certificate; and
    2. A notarized copy of the will or other appropriate legal documentation establishing the successor's right to the Sheago Cosmetics business.
  5. To complete a transfer of the Sheago Cosmetics business because of incapacity, the successor must provide the following to the Sheago Cosmetics Compliance Department:
    1. A notarized copy of an appointment as trustee;
    2. II. A notarized copy of the trust document or other appropriate legal documentation establishing the trustee's right to administer the Sheago Cosmetics business; and
    3. A completed BLC Agreement executed by the trustee.
  6. If the successor is already an existing BLC, Sheago Cosmetics will allow such BLC to keep his or her own business plus the inherited business active for up to six (6) months. By the end of the six-month period, the BLC must have compressed (if applicable), sold or otherwise transferred either the existing business or the inherited business.
  7. If the successor wishes to terminate the Sheago Cosmetics business, he or she must submit a notarized statement stating the desire to terminate the business, along with a certified copy of the death certificate, appointment as trustee, and/or any other appropriate legal documentation.
  8. Upon written request, Sheago Cosmetics may grant a one (1) month bereavement waiver and pay out at the last "paid as" rank.

11.9

Resignation/Voluntary Termination

  1. A BLC may immediately terminate his or her business by submitting a written notice or email to the Sheago Cosmetics Compliance Department compliance [at] www.sheago.com. The written notice must include the following;
    1. The BLC's intent to resign;
    2. Date of resignation;
    3. Sheago Cosmetics Identification Number;
    4. Reason for resigning; and
    5. Signature.
  2. A Sheago Cosmetics BLC may not use resignation as a way to immediately change Sponsor and Placement. Instead, the BLC who has voluntarily resigned is not eligible to reapply for a business or have any financial interest in a or any Sheago Cosmetics business for six (6) months from the receipt of the written notice of resignation.

11.10

Involuntary Termination

  1. Sheago Cosmetics reserves the right to terminate a BLC's business for, but not limited to, the following reasons:
    1. Violation of any Terms or Conditions of the BLC Agreement;
    2. Violation of any provision in these Policies and Procedures;
    3. Violation of any provision in the Compensation Plan;
    4. Violation of any applicable law, ordinance, or regulation regarding the Sheago Cosmetics business;
    5. Engaging in unethical business practices or violating standards of fair dealing; or
    6. Returning over $500 worth of products, services and/or sales tools for a refund within a twelve (12) month period.
  2. Sheago Cosmetics will notify the BLC in writing by certified mail, return receipt requested or overnight documented mail, at his or her last known address of its intent to terminate the BLC's business and the reasons for termination. The BLC will have fifteen (15) calendar days from the date of mailing of such notice to respond in writing to the allegations or claims constituting cause for termination as stated in the notice. Sheago Cosmetics will then have thirty (30) calendar days from the date of receipt of the BLC's response to render a final decision as to termination.
  3. If a decision is made by Sheago Cosmetics to terminate the BLC's business, Sheago Cosmetics will inform the BLC in writing that the business is terminated effective as of the date of the written notification. The BLC will then have fifteen (15) calendar days from the date of mailing of such notice to appeal the termination in writing. Sheago Cosmetics must receive the BLC's written appeal within twenty (20) calendar days of the date of the Sheago Cosmetics termination letter. If the written appeal is not received within this time period, the termination will be considered final.
  4. If the BLC does file a timely appeal of termination, Sheago Cosmetics will review its decision, along with any other information it may deem relevant, reconsider any other appropriate action, and notify the BLC of its decision. The decision of Sheago Cosmetics is then considered final and not subject to further review.
  5. If the termination is not rescinded, the termination will be effective as of the date of the original termination notice by Sheago Cosmetics. The former BLC shall thereafter be prohibited from using the names, marks or signs, labels, stationery, advertising, or business material referring to or relating to any Sheago Cosmetics products or services. Sheago Cosmetics will notify the active Upline Sponsor within ten (10) days after termination. The organization of the terminated BLC will "roll up" to the active Upline Sponsor on record.
  6. The Sheago Cosmetics BLC who is involuntarily terminated by Sheago Cosmetics may not reapply for a business, either under his or her present name or any other name or entity, without the express written consent of an officer of Sheago Cosmetics, following a review by the Sheago Cosmetics Compliance Committee. In any event, such BLC may not re-apply for a business for twelve (12) months from the date of termination.

11.11

Effect of Cancellation

  1. Following a BLC's cancellation for inactivity or voluntary or involuntary termination (collectively, a "cancellation") such BLC:
    1. Shall have no right, title, claim or interest to any commission or bonus from the sales generated by the BLC's former organization or any other payments in association with the BLC's former independent business;
    2. Effectively waives any and all claims to property rights or any interest in or to the BLC's former Downline organization;
    3. Shall receive commissions and bonuses only for the last full pay period in which he or she was active prior to cancellation, less any amounts withheld during an investigation preceding an involuntary cancellation, and less any other amounts owed to Sheago Cosmetics.

12.0

DISCIPLINARY SANCTIONS

12.1

Imposition of Disciplinary Action - Purpose

  1. It is the spirit of Sheago that integrity and fairness should pervade among its BLCs, thereby providing everyone with an equal opportunity to build a successful business. Therefore, Sheago reserves the right to impose disciplinary sanctions at any time, when it has determined that a BLC has violated the Agreement or any of these Policies and Procedures or the Compensation Plan as they may be amended from time to time by Sheago Cosmetics.

12.2

Consequences and Remedies of Breach

  1. Disciplinary actions may include one or more of the following:
    1. Monitoring a BLC's conduct over a specified period of time to assure compliance;
    2. Issuance of a written warning or requiring the BLC to take immediate corrective action;
    3. Imposition of a fine (which may be imposed immediately or withheld from future commission payments) or the withholding of commission payments ("Commission Hold") until the matter causing the Commission Hold is resolved or until Sheago Cosmetics receives adequate additional assurances from the BLC to ensure future compliance;
    4. Suspension from participation in Company or BLC events, rewards, or recognition;
    5. Suspension of the Sheago Cosmetics BLC Agreement and business for one or more pay periods;
    6. Involuntary termination of the BLC's Agreement and business;
    7. Any other measure which Sheago Cosmetics deems feasible and appropriate to justly resolve injuries caused by the BLC's Policy violation or contractual breach; OR
    8. Legal proceedings for monetary or equitable relief.

13.0

DISPUTE RESOLUTION

13.1

Grievances

  1. If a Sheago Cosmetics BLC has a grievance or complaint against another BLC regarding any practice or conduct relating to their respective Sheago businesses, he or she is encouraged to resolve the issue directly with the other party. If an agreement cannot be reached, it must be reported directly to the Company Compliance Department as outlined below in this Section.
  2. The Company Compliance Department will be the final authority on settling such grievance or complaint and its written decision shall be final and binding on the BLCs involved.
  3. Sheago Cosmetics will confine its involvement to disputes regarding Sheago Cosmetics business matters only. Sheago Cosmetics will not decide issues that involve personality conflicts or unprofessional conduct by or between BLCs outside the context of a Sheago Cosmetics business. These issues go beyond the scope of Sheago Cosmetics and may not be used to justify a Sponsor or Placement change or a transfer to another Sheago Cosmetics organization.
  4. Sheago Cosmetics does not consider, enforce, or mediate third party agreements between BLCs, nor does it provide names, funding, or advice for obtaining outside legal counsel.
  5. Process for Grievances:
    1. The Sheago Cosmetics BLC should submit a written letter of complaint (e-mail will not be accepted) directly to the Sheago Cosmetics Compliance Department. The letter shall set forth the details of the incident as follows:
      1. The nature of the violation;
      2. Specific facts to support the allegations;
      3. Dates;
      4. Number of occurrences;
      5. Persons involved; and
      6. Supporting documentation.
    2. Upon receipt of the written complaint, Sheago Cosmetics will conduct an investigation according to the following procedures:
      1. The Compliance Department will send an acknowledgment of receipt to the complaining BLC;
      2. The Compliance Department will provide a verbal or written notice of the allegation to the BLC under investigation. If a written notice is sent to the BLC, he or she will have ten (10) business days from the date of the notification letter to present all information relating to the incident for review by Sheago Cosmetics
      3. The Compliance Department will thoroughly investigate the complaint, consider all the submitted information it deems relevant, including information from collateral sources. Due to the unique nature of each situation, determinations of the appropriate remedy will be on a case by case basis, and the length of time to reach a resolution will vary.
      4. During the course of the investigation, the Compliance Department will only provide periodic updates simply stating that the investigation is ongoing. No other information will be released during this time. BLC calls, letters, and requests for "progress reports" during the course of the investigation will not be answered or returned.
  6. Sheago Cosmetics will make a final decision and timely notify the Sheago Cosmetics BLCs involved.

13.2

Arbitration

  1. Any controversy or claim arising out of or relating to the Sheago Cosmetics BLC agreement, these Policies and Procedures, or the breach thereof, the BLC's business or any dispute between Sheago Cosmetics and the BLC, shall be settled by binding and confidential arbitration administered by the American Arbitration Association under its commercial arbitration rules, and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Any such arbitration shall be held in Detroit, Michigan. There shall be one arbitrator, who shall have expertise in business law transactions and who shall be knowledgeable in the direct selling industry, selected from a panel provided by the American Arbitration Association.
  2. The prevailing party in any such arbitration shall be entitled to receive from the losing party, all costs and expenses of arbitration, including reasonable attorney's fees and filing fees. The decision of the arbitrator shall be final and binding on the parties and may, if necessary, be reduced to judgment in any court of competent jurisdiction.
  3. This agreement to arbitration shall survive any termination or expiration of the BLC agreement.
  4. Nothing in these Policies and Procedures shall prevent Sheago Cosmetics from applying for or 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 Sheago Cosmetics interests or its Confidential Information prior to, during or following the filing of an arbitration or other proceeding, or pending the rendition of a decision or award in connection with any arbitration or other proceeding.
  5. NO CLASS ACTION, OR OTHER REPRESENTATIVE ACTION OR PRIVATE ATTORNEY GENERAL ACTION OR JOINDER OR CONSOLIDATION OF ANY CLAIM WITH A CLAIM OF ANOTHER PERSON OR CLASS OF CLAIMANTS SHALL BE ALLOWABLE.
  6. These Policies and Procedures and any arbitration involving a BLC and Sheago Cosmetics shall be governed by and construed in accordance with the laws of the state of Michigan, without reference to its principles of conflict of laws.

13.3

Severability

  1. If any provision of these Policies and Procedures is found to be invalid, or unenforceable for any reason, only the invalid provision shall be severed. The remaining terms and provisions hereof shall remain in full force and shall be construed as if such invalid or unenforceable provision never had comprised a part of these Policies and Procedures.

13.4

Waiver

  1. Only an officer of the Company can, in writing, affect a waiver of the Sheago Cosmetics Policies and Procedures. Sheago's waiver of any particular breach by a BLC shall not affect its rights with respect to any subsequent breach, nor shall it affect the rights or obligations of any other BLC.
  2. The existence of any claim or cause of action of a BLC against Sheago Cosmetics shall not constitute a defense to Sheago Cosmetics's enforcement of any term or provision of these Policies and Procedures.

13.5

Successors and Claims

The agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns.

14.0

GOVERNING LAW

These Policies and Procedures shall be governed by and construed in accordance with the Laws of the State of Michigan and the exclusive jurisdiction of the United States courts.

15.0

SHEAGO COSMETICS GLOSSARY OF TERMS

ACTIVE BLC: A BLC who satisfies the minimum volume requirements, as set forth in the Compensation Plan, to ensure that they are eligible to receive bonuses and commissions.

AGREEMENT: The contract between the Company and each BLC which includes: (i) the BLC Agreement; (ii) the Sheago Cosmetics Policies and Procedures; and (iii) the Sheago Cosmetics

Compensation Plan, all in their current form and as amended by Sheago Cosmetics in its sole discretion. These documents are collectively referred to as the "Agreement."

CANCEL: The termination of a BLC's business. Cancellation may be either voluntary, involuntary, or through non-renewal.

COMPENSATION PLAN: The guidelines and referenced literature for describing how BLCs can generate commissions and bonuses.

CUSTOMER: A Customer who purchases Sheago Cosmetics products and does not engage in building a business or retailing product.

BLC: An individual who purchases product, generates retail sales and business building commissions.

LINE OF SPONSORSHIP (LOS): A report generated by Sheago Cosmetics that provides critical data relating to the identities of BLCs, sales information, and enrollment activity of each BLC's organization. This report contains confidential and trade secret information which is proprietary to Sheago Cosmetics.

ORGANIZATION: The Customers and BLCs placed below a particular BLC.

OFFICIAL SHEAGO COSMETICS MATERIAL: Literature, audio or video tapes, and other materials developed, printed, published, and distributed by Sheago Cosmeticsto BLCs.

PLACEMENT: Your position inside your Sponsor's organization.

RECRUIT: For purposes of Sheago Cosmetics's Conflict of Interest Policy, the term "Recruit" means the actual or attempted solicitation, enrollment, encouragement, or effort to influence in any other way, either directly, indirectly, or through a third party, another Sheago Cosmetics BLC or Customer to enrol or participate in another multilevel marketing, network marketing, or direct sales opportunity.

SPONSOR: A BLC who enrolls a Customer, retailer, or another BLC into the Company, and is listed as the Sponsor on the BLC Agreement. The act of enrolling others and training them to become BLCs is called "sponsoring."

UPLINE: This term refers to the BLC or BLCs above a particular BLC in a sponsorship line up to the Company. It is the line of sponsors that links any particular BLC to the Company.

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