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Distributor Policies and Procedures for U.S. Distributors

View the Policies and Procedures for Canadian Distributors

Scent-Sations, Inc.
Distributor Policies and Procedures
Effective April 1, 2013

These Policies & Procedures, are effective as of the date first displayed above and govern the way a Scent-Sations, Inc.® Distributor conducts business with Scent-Sations, Inc. and/or its subsidiaries (the "Company"), with other Scent-Sations, Inc. Distributors, and with retail Customers. They replace and succeed all previous versions. The governing definitions are capitalized and found in Appendix A. The term "Company" refers to Scent-Sations, Inc., and its subsidiaries, successors and assigns. The term "Distributor" refers to a Person currently licensed by the Company to operate a Distributorship. Any interpretation, clarification, exclusion, or exception to these Policies and Procedures, in order to be effective, must be in writing and signed by an authorized officer of the Company. The Company endeavors to enforce the Policies and Procedures on a uniform and nondiscriminatory basis. However, any failure to enforce any of the provisions of the Policies and Procedures with one Distributor does not waive the Company's right to enforce any such provision(s) with that same Distributor or any other Distributor.

These Policies and Procedures, the Statement of Beneficial Interest (if any), and any country or situation specific addendum in their present forms and as amended from time to time at the sole discretion of the Company, are by this reference incorporated into, and form an integral part of, the Distributor Agreement. We reserve the right, at our complete discretion, to change these terms and conditions at any time by posting revised terms on our website. It is your responsibility to check periodically for any changes we may make to these terms and conditions. Your continued use of this site following the posting of any changes to these terms or other policies implies your acceptance of any changes. Collectively, said documents are referred to as the "Contract". Each Distributor has the responsibility to read, understand, and adhere to the Contract as well as ensure that he or she is aware of and operating under the most current version of the Contract. When Sponsoring a new Distributor, the Sponsoring Distributor shall provide the most current version of the Contract to the applicant prior to his or her execution of the Distributor Agreement. By signing a Distributor Agreement or accepting Commissions from the Company, a Distributor demonstrates that he or she has read, understands and consents to abide and be bound by the Contract. The Company may amend the Contract from time to time as laws and business circumstances change. It is the responsibility of all Distributors to regularly review the most recently published Contract, located at or other Company websites.

The Company will also provide a copy of its most current Contract upon the Distributor's request.

Code of Ethics

The Company has made a commitment to provide its Distributors with top quality Products, exceptional support and a proven, successful Compensation Plan. A Distributor may purchase Products directly from the Company for both personal use and for resale to consumers. In turn, a Distributor agrees to represent the Products and income opportunity in an ethical and professional manner. Each Distributor shall adopt and live by the following Code of Ethics:

As a Distributor:

  1. I will be respectful of each and every person I meet while working my Distributor Business.

  2. At all times I will conduct myself and my business in an ethical, moral, legal and financially sound manner and will not engage in any deceptive or illegal practice.

  3. I will not communicate disparaging comments about competitors' products to others and shall not communicate slanderous, libelous and derogatory statements about competitors or other Distributors. In consideration of the Company’s recognition, Bonuses, and other compensation that I receive as a Distributor, I will not disparage the Company, or any other company or person, including but not limited to other Distributors, the Company’s Products, the Sales Compensation Plan, the Policies and Procedures or Company employees. Disparagement may result in termination of my Distributorship.

  4. I will not engage in activities that would bring disrepute to the Company, other Distributors, or me.

  5. I will be truthful in my representation of the Products and will make no Product claim that is not contained in and supported by official Company publications.

  6. I will fulfill my leadership responsibilities as a Sponsor by training, assisting, and otherwise supporting the Distributors in my Downline Organization.

  7. I will correctly and lawfully represent the Compensation Plan and the income potential represented therein. I understand I may not use my own income as an indication of other's potential success, or use compensation checks as marketing materials.

  8. I will abide by each and every term and condition of the Contract.

  9. I will honor the terms of the Product return and refund policies with all of my retail Customers.

  10. I will respect the Sponsor relationship of every other Distributor and I will neither attempt to interfere with or change these relationships nor make disparaging or untrue claims about other Distributors.

Section 1: Becoming a Distributor

The purpose of the independent distributor contract and agreement (hereinafter referred to as the "agreement") is to establish the Scent-Sations Independent Distributor (hereinafter referred to as the representative, distributor or distributorship) as an authorized representative for the sale of Scent-Sations products.

  1. Age of Majority In order to become a Distributor, all Applicants must have reached the age of majority, usually eighteen (18) years of age, in the jurisdiction in which they reside.

  2. Minors Becoming a Distributor If you are a minor who is at least 16 years old, you may become a Distributor if you submit a hard copy Distributor Agreement signed by you and by your parent or legal guardian. Your parent or legal guardian will be required to supervise your activities. If your parent or legal guardian is a Distributor, then

    1. your Distributorship is considered a second account separate from your parent or legal guardian’s account;

    2. your parent or legal guardian must be your Sponsor; and

    3. your parent or legal guardian cannot have any Beneficial Interest in your Distributorship.

  3. Application An Applicant receives a license to exercise the Distributor Rights and operate a Distributorship when he or she i) purchases a sign-up kit (if applicable) and ii) returns to the Company a completed and signed original or electronic (faxed or scanned) Distributor Agreement or signs through the Company's on-line application process (in those countries where it is available), and (iii) the Company accepts the Agreement. (The Distributor Agreement and other necessary forms are available on the Company's website.)

    1. In order to be accepted by the Company, a Distributor Agreement for the country in which the Applicant resides and any other required document of the Contract must be complete and correct in every respect and submitted by the Distributor.

    2. Failure of the Distributor to submit a complete and correct Agreement or to provide appropriate documentation, when requested, may result in the Distributor Agreement being rejected by the Company. The right to accept or renew any Distributor Agreement remains solely with the Company.

    3. A Distributor may be required to provide the Company with proof of residency, work authorizations, copies of other legal documents, and demonstrate the ability to legally conduct business in the country stated on the Distributor Agreement.

  4. Required Purchase Unless otherwise prohibited by law, the only purchases required to obtain and maintain an active Distributorship is $39.95 in commissionable volume each month.

  5. Active Distributorship Any distributor is considered an active distributor when he or she places an order under the following conditions:

    1. Auto Ship Distributor - $39.95 Personal CV Autoship Order.

    2. Associate Distributor - $39.95 Personal Commissionable Volume.

    For an Associate Distributor to qualify to receive a commission check, they must have a minimum C.V. of $39.95 in that commission period. If a distributor changes his/her status to Associate, and wishes to continue using his/her website, he/she must enroll in the $14.95 website autoship program immediately upon downgrading to the Associate level.

  6. Policy Enforcement A distributor who fails to fulfill their monthly qualifying requirements two (2) times within a calendar year starting from the anniversary date of their initial signup will have their eligibility to place orders revoked. Any distributor who remains on policy enforcement for this reason until the next commission run will be inactivated.

  7. Inactive Status Once a distributor becomes inactive, they are no longer able to place orders and receive their commission checks. An inactive distributor will have their downline permanently roll up to the next active distributor in their upline.

  8. Phoned Applications A temporary Distributorship will be created for those Distributor Agreements processed via the telephone until such time as the Company has received the completed Contract. This temporary Distributorship is subject to all the terms and conditions of the Contract and, while the original documentation is being received and processed, allows the Applicant to order Product for thirty (30) days. If the Applicant fails to provide the Company with an original, signed Distributor Agreement or electronic copy of the same within the thirty (30) days, the temporary Distributorship may be terminated.

  9. Business Entities If the Applicant is a Business Entity, the original signature on the Distributor Agreement must be of a person authorized to bind the Business Entity. The Applicant must also submit with the Distributor Agreement: (i) an Identification Number for the Business Entity, and (ii) a copy of any additional legal documentation which must include the signature and Identification Number or other personal identification number of every Person having a Beneficial Interest in the Business Entity. To verify the form of the Business Entity, Beneficial Interest holders, and authorized signatories, the Company may require, at any time, the Applicant to submit a copy of its Articles of Organization, Articles of Incorporation or other charter documentation.

  10. Assumed Names A person or entity may apply under a legally registered assumed name, provided that the application includes the signatures of all persons acting under or holding an interest in the assumed name.

  11. Multiple Applications If an applicant submits multiple distributor contract and agreement forms listing multiple sponsors, only the first completed form to be received by Scent-Sations will be accepted. All others will be considered null and void.

  12. Identification Number For tax reporting (where required) and identification purposes (where permitted by law), the Company requires Applicants to provide the Identification Number or other personal identification number. Failure to provide this number may result in rejection of the Application or cancellation of the Distributorship.

  13. Inaccurate Information If the Company determines that the Distributor Agreement or the Statement of Beneficial Interest contains inaccurate or false information, it may immediately terminate a Distributorship or declare the Distributorship Agreement null and void from its beginning. Further, it is the obligation of the Distributor to report to the Company on an ongoing basis any changes which affect the accuracy of the Contract.

  14. Term The Contract is valid until a request is received in writing by the distributor to terminate their distributorship or the contract is terminated by the Company.

  15. Effects of Marriage, Divorce, and Death on the Distributorship

    1. Marriage. A spouse is deemed to have a Beneficial Interest in a Distributorship and all acts and omissions of the spouse shall be imputed to the Distributor. If two Distributors marry, they may keep their Distributorships separate. However, all other conditions of the Beneficial Interest rules of the Contract apply to both Distributorships.

    2. Divorce. When a married couple whose individual names appear as Distributors on the Distributor Agreement separate or divorce, the Company will continue paying earnings under the Compensation Plan in the same manner as prior to the separation or divorce until the Company is served with a legally binding certified copy of a divorce decree or other court order that provides direction on payment and/or disposition of the rights under the Contract. Where there is a change in ownership as ordered by the court, the spouse remaining as a Distributor must submit an amended Distributor Agreement. In no event will the Distributorship be partitioned.

    3. Death and Inheritance. In the case of a Distributor's death, the Contract will be assigned to the legal successor to the Distributorship (who can properly qualify according to the Contract) in accordance with applicable laws. The Company requires certified copies of the death certificate (or a doctor's statement) and a certified will, court order, or other appropriate legal documentation. Successors in interest must submit an amended Distributor Agreement. Upon notice of demise, the Company reserves the right to make payments to the estate of the deceased Distributor. If the legal successor wishes to terminate the account, a written, signed statement of request to terminate must be submitted along with appropriate legal proof of death. If the legal successor to the Distributorship is already an existing Distributor, the Company will allow the multiple Beneficial Interest through inheritance for up to six (6) months, by which time the existing Distributor must have sold or otherwise transferred either the existing or the inherited Distributorship.

  16. Merger Two Distributorships may be merged into a single Distributorship if one is the Sponsor of the other. Every merger is final. To effectuate the merger, both Distributors must submit an amended Distributor Agreement and obtain the Company's consent.

  17. Multiple Beneficial Interests

    1. A Distributor is allowed to have a Beneficial Interest in more than one Distributorship in the form of a married couple, however this is highly discouraged as it can lead to confusion by the downline and makes it more difficult to achieve ranks, bonuses, etc.

    2. If a Person with a Beneficial Interest in an existing Distributorship wishes to become a Distributor under another Sponsor, the Person must first terminate the Beneficial Interest in the existing Distributorship and wait six (6) months before applying to be a Distributor under another Sponsor.

  18. Non-Exclusive Territory The licensing of the rights granted herein does not include a grant of an exclusive franchise or territory to a Distributor, nor is a Distributor allowed to make such claims.

Section 2 - Obligations of a Distributor and Managing a Distributorship

  1. Compliance. A Distributor shall comply at all times with each of the terms and conditions of the Contract.

  2. Independent Contractor. A Distributor is an independent contractor and is responsible for his or her own business expenses, decisions, and actions.

    1. When you sponsor a distributor you must take a proactive role in providing assistance and company approved training. You must have regular, ongoing contact with distributors in your organization (organization being those levels you are receiving commissions from). These include and are not limited to newsletters, meetings, telephone conversation, voice mail, email, team meetings and company functions.

    2. Scent-Sations pays leadership bonuses/commissions, in accordance with your current rank, on the commission-able volume of your downline organization.

    3. It is your responsibility to lead your downline organization and set a proper example in all aspects of running your Scent-Sations business. (Personal sales, sponsoring, downline training, development and nurturing included but not limited to not returning calls or emails; requests for three way calls and live opportunity meetings. Also the manner in which you run your Scent-Sations business and conduct yourself.

    4. If it is deemed by Scent-Sations that you are not fulfilling these responsibilities, you may lose your rights to receive leadership bonuses/commissions. Scent-Sations can, at its sole discretion, opt to demote you as a result of your not fulfilling your contractural obligations.

    5. A Distributor shall not represent himself or herself as an agent, employee, partner, or joint venturer with the Company. A Distributor shall not make purchases or enter into any transactions in the Company's name. All Scent-Sations distributors are independent contractors, whose success or failure depends opon his or her personal efforts. The representative, his or her agents and / or employees shall, under no circumstances, be treated as or deemed to be agents, employees, or corporate representatives of Scent-Sations, Inc. Distributors are not franchises, joint ventures, partners, employees, or agents of Scent-Sations, Inc. Distributors are strictly prohibited from stating or implying either orally, electronically, in writing or in any other manner, that they are franchises, joint ventures, partners or employees of Scent-Sations, Inc. All distributors shall at all times conform to all IRS regulations governing independent contractor status. Neither the representative nor Scent-Sations, Inc shall have any right to enter into contracts or commitments in the name of, or on behalf of, the other to bind the other in any way.

    6. A Distributor's work hours, business expenditures, and business plans are not dictated by the Company. A Distributor shall make no printed or verbal representations which state or imply otherwise.

    7. A Distributor is fully responsible for all of his or her verbal and/or written statements made regarding the Products, services, and the Compensation Plan which are not expressly contained in official Company materials and the Distributor agrees to indemnify the Company against any claims, damages, or other expenses, including attorneys' fees, arising from any representations or actions made by the Distributor that are outside the scope of the Contract. The provisions of this section survive the termination of the Contract.

  3. Income Claims. A Distributor may not make statements regarding actual income figures (whether past or present) and may not disclose to potential and existing Distributors actual, copied, or representative Commission checks. A Distributor may not make income guarantees of any kind and may not make unrepresentative, unreasonable, or misleading earnings claims. The distributor shall never state that profits are guaranteed. Opportunity or income exaggeration shall never be given. Failure to comply with this will result in termination.

  4. Compliance with Laws. In conducting its Distributor Business, a Distributor must comply with all applicable national and local laws, regulations, and ordinances. A Distributor shall not violate any laws which apply to unfair competition or business practice, including any law that prohibits the advertising, offer to sell, or sale of Products at less than the Wholesale price of the product.

  5. Offerings. A Distributor may not offer or promote any non-Company plans, products, incentives, opportunities, or non-approved Sales Tools in conjunction with the promotion of Products.

  6. Customer Acquisition. A Distributor must conduct all Distributor Business with the understanding that the Distributor's success is only achieved through the regular and repeated Retail Sale of Products by a Distributor and by his or her Downline Organization.

  7. Negative Statements. A Distributor will make no disparaging, misleading, inaccurate, or unfair statements, representations, claims, or comparisons with regard to:

    1. the Company, its Products, its commercial activities, or its Distributors; or

    2. other companies, including competitors, their services, products or commercial activities.

  8. Unethical Activity. A Distributor must be ethical and professional at all times when conducting Distributor Business. A Distributor will not, nor will the Distributor permit Distributors in his or her Downline Organization to engage in unethical activity. Examples of unethical activities include, but are not limited to the following:

    1. Causing Product sales in Retail Establishments;

    2. Use of another Distributor's credit card without express written permission;

    3. Unauthorized use of any Company Confidential Information;

    4. Cross-Company Recruiting (including aiding and abetting another to Cross-company recruit);

    5. Cross-line Recruiting (including aiding and abetting another to Cross-line Recruit);

    6. Writing checks without sufficient funds to either the Company or another Distributor;

    7. Making unapproved claims about the Product;

    8. Making income claims about the Distributor Business;

    9. Making false statements or misrepresentation of any kind, including but not limited to: untruthful or misleading representations or sales offers relating to the quality, availability, grade, price, terms of payment, refund rights, guarantees, or performance of Products;

    10. Personal conduct that discredits the Company and/or its Distributors;

    11. Violating the laws and regulations pertaining to the Distributor Business;

    12. Failing to meet Sponsor responsibilities;

    13. Violating the Code of Ethics;

    14. Violating the Contract.

    No distributor shall sell or present for sale any non-company products or services, nor shall business or marketing opportunities of any other company be discussed, presented or promoted at any Scent-Sations business opportunity meeting or any other company-related activity. Nor shall such presentations or sales be conducted immediately preceeding or following any Scent-Sations activity in the same place of a Company (or distributor) meeting or activity.

  9. Enticing Other Distributors. If a Distributor did not personally Sponsor another Distributor on his or her Front Line, the Distributor is prohibited from soliciting or enticing that Distributor to sell or purchase products or services other than those offered by the Company. To do so constitutes an unreasonable and unwarranted interference with the contractual relationship between the Company and its Distributors, conversion, and a misappropriation of trade secrets.

    Distributors may be active in other businesses but are expressly prohibited from soliciting or sponsoring any Scent-Sations customers or distributors to those businesses. Distributors shall not offer the Scent-Sations business opportunity in conjunction with any non-Scent-Sations business opportunity or incentive. Distributors shall not use names, addresses, e-mail addresses, or phone or fax numbers of Scent-Sations customers or distributors as mailing or contact lists to market any non-Scent-Sations products, services or business opportunities. If a distributor is found to be soliciting any Scent-Sations distributor(s) for another business opportunity, the distributor risks having all distributor rights and privileges immediately revoked and will forfeit their downline, any current or future commissions due, and possible legal action.

    The Distributor agrees that a violation of this rule inflicts irreparable harm on the Company and agrees that the appropriate non-exclusive remedy to prevent that harm is immediate injunctive relief without bond. The provisions of this section survive the termination of the Contract.

  10. Cross-Company Recruiting. If a Distributor did not personally sponsor another Distributor on his or her Front Line, the Distributor is prohibited during the term of the Contract and for 12 months thereafter from soliciting or enticing that Distributor to sell or purchase products or services and/or to act as an independent distributor, employee, executive, or consultant to or on behalf of another direct selling, network marketing, or multi-level marketing company in any Authorized Country. To do so constitutes an unreasonable and unwarranted interference with the contractual relationship between the Company and its Distributors. The Distributor agrees that a violation of this rule inflicts irreparable harm on the Company and agrees that the appropriate remedy to prevent that harm is immediate injunctive relief without bond. The provisions of this section survive the termination of the Contract. Nothing herein waives any other rights and remedies the Company may have in relation to the use of its Confidential Information. The Distributor agrees that appearing in, being referenced in, or allowing the Distributor's name or likeness to be featured or referenced in any promotional, recruiting or solicitation materials for another direct selling company constitutes Cross-company Recruiting.

  11. Resolving Disputes. A Distributor must conduct all activity in the best interests of the Company. Sponsors shall use their best efforts to resolve disputes in the Downline Organizations. Any personal disputes between Distributors must be resolved quickly and in the best interests of the Company.

  12. No Claims of Unique Relationship. A Distributor may not allege or imply that he or she has a unique relationship with, advantage with, or access to the Company executives or employees that other Distributors do not have.

  13. Detrimental Conduct. If any conduct by a Distributor or any participant in the Distributorship is determined by the Company to be injurious, disruptive, or harmful to the Company or to other Distributors, the Company may take appropriate action against a Distributor and the Distributorship as set forth in Section 8.

  14. No Reliance. A Distributor may not rely on the Company to provide legal, financial, or other professional advice, nor may it rely on any such advice if given. All Distributors are encouraged to consult with the appropriate professional on all legal and accounting matters.

  15. Service Charges. The Company provides numerous services to its Distributors without charge. However, Distributors occasionally make requests that require special time and effort to fulfill. Requests in this category would include copies of receipts, paperwork, in-depth Commission information that must be calculated or extracted, research, banking instructions, stop-payment requests, etc. These and other special requests are available to the Distributor for a cost of thirty dollars ($30 USD or equivalent local currency) per hour, plus actual costs, with a minimum charge of thirty dollars ($30 USD or equivalent local currency) per request. Costs would include banking fees, photocopy expenses, professional fees, phone charges, etc. If a former distributor needs to access historical data (such as for income tax filing) then access will be granted for a 24 hour period for a flat $10 fee.

  16. Insurance. The Company carries a commercially reasonable amount of product liability insurance. However, the Company does not distribute copies of the policy nor does it disclose the amount of the insurance. Since laws differ according to jurisdiction, the Company encourages its Distributors to consult with an attorney regarding the extent of their personal legal liability with respect to their independent businesses.

  17. Confidentiality. Upon signing a Distributor Agreement, the Distributor agrees to maintain confidentiality regarding Confidential Information and any other trade secrets and proprietary information. This confidentiality obligation is irrevocable, remains after termination of the Contract, and is subject to legal enforcement by injunction and award of costs and fees necessarily incurred. All Confidential Information is transmitted to Distributors in strictest confidence on a need-to-know basis for use solely in the Distributor Business. Distributors must use their best efforts to keep such information confidential and must not disclose any such information to any third party, directly or indirectly. Distributors must not use the Confidential Information to compete with Company or for any purpose other than for promoting the Company's program and its products and services. The Distributor maintains no ownership interest in any Confidential Information, including contact and profile information of Downline Organizations and may not sell, disseminate, or provide it to any other party.

  18. Privacy of Distributor Information. All information provided by an Applicant on a Distributor Agreement will be used solely for the purposes of evaluating the Distributor Agreement and for related activities of the Distributor. A Distributor authorizes the Company to disclose, in the Company's sole discretion, its contact information to the Distributor's Upline, and to the Distributor's Downline Organization up to eight (8) levels below or to those Distributors for whom the Distributor is the closet Upline "Director" or above (as defined in the Compensation Plan). The contact information may be used only for the Distributor Business.

  19. Use of Confidential Information. The Distributor may acquire Confidential Information during the term hereof, for example, from the sale of distributor tools or merchandise to Scent-Sations, Inc. distributors, including those who are crossline to the Distributor. Accordingly, regardless of the source of the Confidential Information, the Distributor understands and agrees:

    1. the Confidential Information is for the exclusive and limited use of the Distributor to facilitate the training, support and servicing of the Distributor's Downline Organization for furtherance of the Distributor Business only;

    2. he or she will not disclose the Confidential Information to a third party directly or indirectly (including other Distributors) and that doing so constitutes misuse, misappropriation, and a violation of the Contract;

    3. the information is of such character as to render it unique and that disclosure of it will cause irreparable damage to the Company; the Company is therefore entitled to injunctive relief to prevent violation of this policy;

    4. he or she will not use the information to compete with the Company directly or indirectly and improper use will result in termination of the Contract);

    5. he or she may be required to sign a non-disclosure agreement before receiving Confidential Information from the Company, or prior to engaging in activities that would allow the Distributor to acquire Confidential Information; and

    6. upon expiration, non-renewal or termination of the Contract, he or she will discontinue the use of such Confidential Information and destroy or promptly return to the Company all Confidential Information under the control of or in his or her possession.

  20. Notification of Adverse Action. A Distributor shall immediately notify the Company in writing of any potential or actual legal claims from third parties against the Distributor arising from, or associated with, the Distributor Business or the Downline Organization that may adversely affect the Company. After notifying the Distributor, the Company may take any action necessary to protect itself, including controlling any litigation or settlement of the legal claims. If the Company takes action in the matter, the Distributor shall not interfere or participate in the matter without the Company's consent, which shall not be unreasonably withheld.

  21. Release for use of Photo, Audio, or Video Image, and/or testimonial Endorsement. The Company may take photos, audio or video recordings, or written or verbal statements of a Distributor at Company events or may request the same directly from a Distributor. The Distributor agrees to and hereby grants the Company the absolute and irrevocable right and permission, to use, re-use, broadcast, rebroadcast, publish, or republish any such photo, audio, video, or endorsement, in all or in part, individually or in conjunction with any other photograph or video, or any other endorsement, in any current or future medium and for any purpose whatsoever, including (but not by way of limitation) marketing, advertising, promotion, and/or publicity; and to copyright such photograph and/or video, in the original or as republished, in the name of the Company, or in any other name. Regardless of any other agreements or contracts the Distributor may have with any other entity, the Distributor agrees that any use by the Company as set forth in this section shall be royalty free, is a work made for hire, and is not subject to any other claim. The Distributor agrees to defend and indemnify the Company against any claims by any other party arising out of the Company's use of the rights granted herein. The Distributor confirms that the information he or she may give as a testimonial endorsement, or as represented in a photograph, video or audio is true and accurate to the best of his or her knowledge. The Distributor waives any right he or she may have to inspect or approve the finished or unfinished product(s), the advertising copy, printed, recorded, photographic or video matter which may be used in connection with it or any use that may be made of it.

  22. Conducting the Distributor Business Internationally. A Distributor has the right to operate in any Authorized Country where the Distributor may lawfully conduct the Distributor Business. It is a Distributor's responsibility to comply with all international, national and local laws, ordinances, and regulations when conducting Distributor Business in any Authorized Country.

    1. The Company may specify certain countries subject to a Pre-Launch Period in which Distributors may also conduct the Distributor Business. The Company will formally announce a Pre-Launch Period at least thirty (30) days prior to the official opening.

    2. A Distributor has no authority to and shall not conduct the Distributor Business (except as permitted herein), nor introduce or establish the Company's business or Product in a non-Authorized Country or any country that is not the subject of a Pre-Launch Period announcement from the Company. This includes, but is not limited to: any attempts to secure approval for Products or business practices; register or reserve the Company names, trademarks, trade names, or Internet domain names; or establish any kind of business or governmental contact on behalf of the Company.

    3. Prior to an announced Pre-Launch Period, Distributor Business in an unopened country is limited strictly to the following: A Distributor may only hand out business cards and participate in small meetings not exceeding eight (8) total persons personally acquainted with the Distributor or the Distributor's contacts.

    Failure to comply could result in legal action against the distributor(s) and will result in termination of said distributor(s).

  23. No Franchises. There are no franchises or exclusive territories within the United States or Canada as a part of the company's compensation plan. This does not limit the company from establishing licensed distribution points or other types of centers to assist in the development and operation of company programs.

  24. No Medical Claims. The distributor shall not make claims about Scent-Sations products. No claims about products shall be made except what is made in corporate literature.

  25. Labeling, Packaging, and Displaying Products The distributor shall not re-label or re-package any Scent-Sations products.

  26. Advertising All advertising must be factual. The stating of exaggerated claims or misleading information will jeopardize the distributors status. All income is a result of personal effort - any advertising, promoting or representing salaried positions, management positions, hourly wages or guaranteed incomes are considered misleading and prohibited.

  27. Newspaper Advertising Distributors may place classified ads in newspapers provided Scent-Sations names or trademarks are not used and that facts are presented. Any use of company names or trademarks must have the company's advance written consent.

  28. Trademarks and Service Marks The Scent-Sations name, product names and other names as may be adopted by Scent-Sations are proprietary trade names, trademarks and service marks of Scent-Sations, Inc. As such, these marks are of great value to Scent-Sations and are supplied to Distributors for their use only in an expressly authorized manner. Use of the Scent-Sations name, or any product or service name on any advertising, promotion, or other material that is not produced by the company is prohibited, unless approved in writing by Scent-Sations. Distributors may use the Scent-Sations name in telephone book listings, on business cards and stationary as follows:

    Distributor's Name
    Independent Scent-Sations Distributor

  29. Distributor Contact / Profile Changes. Any changes to corporate data on file must be requested in writing via written correspondence, fax or email if they cannot be done online in the Back Office under Change Profile. Examples of this are on file credit card changes, auto ship date, address changes, new credit card expiration dates, state sales tax id number, etc. Any cancellations, downgrades, holds, address or credit card changes MUST be received by the day before the last business day of the month and BEFORE the next set of autoships run. They must be received by 12:00 PM EASTERN time to be in effect before the autoship runs. This applies to autoship orders that run on the first (1st) , fifth (5th) and/or tenth (10th) of the month.

  30. Sales Tax. Please review all information in this section carefully in order to understand and be clear on how sales taxes are managed, collected and remitted.

    Please note: Scent-Sations collects and remits the local sales tax for many cities within the United States and Canada. There are, however other local sales tax jurisdictions that are handled through the local government agencies of which Scent-Sations IS NOT CURRENTLY COLLECTING AND REMITTING. For example, Parish taxes within the state of Louisiana and many Home Rule cities. If you are in an area that requires separate local sales tax registration, you are required to register for the Sales Tax License and remit any local sales tax due direction to your local governing agency. Scent-Sations will continue to collect and remit the State Sales Tax for you.

    You can see if your local and state sales tax rate is collected by Scent-Sations by checking the rate charged on your current orders. Please remember that the sales tax collected on each order is based on the Suggested Retail Price of the product and NOT the wholesale price when calculating your sales tax due.

    For further information on how to collect and remit the local sales tax due, please contact the appropriate cities sales tax department.

    For those distributors who have a valid State Sales Tax License on file with Scent-Sations, as you are aware we do not collect or remit any sales tax for you. Again, all State and Local Sales Tax Due is your responsibility.

    1. State-specific information:
      Distributors residing in the following states do not have a state sales tax and therefore are not charged any sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. In addition, the states of Kansas and Nevada do not allow independent distributors to collect and remit sales tax, and therefore Scent-Sations is not able to recognize and/or accept sales tax licenses from distributors in those states.

      All Scent-Sations Independent Distributors without a State Sales Tax License (or located in Canada) will be charged their state or Province's (where applicable) appropriate sales taxes on the manufacturer's suggested retail price (MSRP) of their resalable product purchases at point of purchase, either in their Back Office or via phone orders. For these distributors, Scent-Sations will collect and remit on their behalf all appropriate state or Provincial sales taxes to the proper taxing authority. You are not responsible for collecting and remitting any sales taxes when Scent-Sations handles this for you.

      This is a service that Scent-Sations provides on behalf of all our distributors who do not wish to deal with collecting and remitting sales taxes. Should you wish to handle sales tax collection and remittance yourself in the United States (not available in Canada), you would need to provide Scent-Sations with a copy of your appropriate tax exemption certificate which is located in your Back Office under the [Distributor Documents] section under [Tax Informaion]. Please note that this is not the same as your Employer Identification Number (EIN). Should you need clarification on any of this information, please contact the Scent-Sations Tax Department who will be happy to assist you.

    2. Drop-Shipping:
      Please note that when drop-shipping product to another state either using the Back Office Online Ordering Form or by placing a phone or fax order, you will be charged that state's appropriate sales tax even if you have a reseller tax ID on file. This is due to your reseller sales tax license only being valid within the state in which is was issued, typically your home state. Therefore, if delivery of that product is located in another state (except for those states listed above which do not have a state sales tax), you will still be charged that state's appropriate sales tax. You would need to apply for a sales tax license in each state you wish to have product delivered should you wish to handle sales taxes yourself in every taxing jurisdiction in which you do business.

    3. Pickup Orders:
      For orders that are picked up at Scent-Sations home office in Wilkes-Barre, PA sales tax will be charged on your order if your state sales tax license is from another state since the destination is Wilkes-Barre, Pennsylvania.

    4. Fundraising:
      Scent-Sations is not able to accept third party sales tax exemption certificates such as those from fundraising organizations since we are not selling directly to those organizations, but to the independent distributor. Many times the fundraising organization is liable for the sales taxes collected on the sales of those products since they are selling them for profit, and not for use by the fundraising (tax-exempt) organization. Please keep all appropriate records and determine your actual costs for any fundraisers that you conduct prior to quoting a profit number to the organization. This will ensure that you do not undercharge the organization or reduce your profits on those sales.

    5. If for any reason your order is not properly charged sales tax due to a problem related to obtaining tax information electronically from our sales tax provider, from an outdated sales tax license, or any other reason, your credit card on file will be charged the amount due. If your card in unable to be charged, future commissions due may be withheld in order to recover any amounts not paid.

    Should you need clarification on any of this information, please contact the Scent-Sations Tax Department who will be happy to assist you.

Section 3 - Sponsorship

  1. Sponsoring. To act as a Sponsor, a Distributor must meet all requirements and accept all responsibilities as outlined in the Contract. Persons wishing to become Distributors may be referred as Applicants to the Company by a Sponsor. Only Applicants residing in Authorized Countries or in those countries subject to a Pre-Launch Period may be Sponsored.

  2. Placement. Once an Applicant's Distributor Agreement is accepted by the Company, the new Distributor is placed in the Sponsor's Downline Organization. A Sponsor may place the new Distributor on his or her Front Line or anywhere else in the Sponsor's Downline Organization. A Sponsor may not place a new Distributor outside its Downline Organization. If this occurs, the Company retains the right to make adjustments to the organization to allow for correct payout and to ensure that all lines are complete.

  3. Training and Support. A Sponsor shall:

    1. make reasonable efforts to ensure that that all Distributors in his or her Downline Organization understand the terms and conditions of the Contract and all applicable international, national and local laws;

    2. provide regular training and bona fide support in the development of his or her Downline Organization's business and the sale of Products;

    3. provide bona fide education and instruction so that Product sales and opportunity meetings conducted by Distributors in his or her Downline Organization are conducted in accordance with the Contract, and with any applicable national and local laws;

    4. give guidance and encouragement to Distributors in his or her Downline Organization; and

    5. make commercially reasonable efforts to settle any dispute arising in his or her Downline Organization.

    6. If, in the opinion of Scent-Sations Inc, you are failing to train, recognize, inform and/or motivate a frontline distributor, or fail to comply with any applicable policy, Scent-Sations Inc, may, at its sole discretion, opt to remove the sponsor's downline, reduce the leadership bonus/commissions, and/or cancel your distributor agreement.

    7. When you sponsor another distributor into Scent-Sations, Inc. you must take a proactive roll in providing assistance and training and ensuring those in your downline are aware of Scent-Sations Inc Policies and comply with those policies.

    8. You must have regular ongoing contact with distributors in your frontline and downline to facilitate such processes. Examples of such contact and communications may include, but are not limited to: newsletters, written correspondence, personal meetings, telephone contact, voice mail, electronic mail and accompanying frontline distributors to Scent-Sations meetings, distributor meetings and other functions.

  4. Lead Assignment. Scent-Sations is available to speak with all prospects who contact the home office. We attempt to connect each prospect with a representative as soon as possible. If the lead does NOT know who prospected him or her, we will label him or her as an "orphan" and assign such leads to distributors based on leadership status.

Section 4 - Sponsor/Placement Changes and Transfers

  1. Sponsor & Placement Changes. Scent-Sations strongly discourages the transfer of distributors or customers from one organization to another. However, a Distributor may apply to change the Sponsor and/or Placement of itself or a personally Sponsored Distributor subject to the limitations described below. Distributor is permitted only one Sponsor change and one Placement change as described herein, and the respective change will be final. Because of the need to maintain the integrity of Downline Organizations, a Sponsor/Placement change may not be feasible.

    1. Sponsor Change Requests must be completed and received at the Company by 5pm Eastern Time (-5 UTC Standard and -4 UTC Mountain Daylight Time) by the 25th day of the month. Requests received after this deadline will be processed for the following month.

    2. A current and accurate Distributor Agreement and Statement of Beneficial Interest, if applicable, must be on file for all Distributors requesting a Sponsor/Placement change.

    Please note: Due to the growth of Internet sponsoring, the company reserves the right to move a distributor who accidentally enrolls under the wrong sponsor through the act of going to a wrong website. The company reserves the right to move the new distributor under his or her intended sponsor within 30 business days of enrollment.

  2. Placement Change Process. A Distributorship may be moved to a new position in the Downline Organization of its immediate Placement if its Distributor obtains written approval of all original 5 levels plus the sponsor (this would comprise a total of 6 levels of upline) and they all must concur with the change.the signature of your sponsor and the 5 upline (provided there are 5). If even one (1) Distributorship does not approve, the transfer cannot occur.

  3. Moving Up. A Distributorship may be moved to a new Placement Upline provided it obtains written authorization from each Distributorship it moves above in Placement. Likewise, a Distributorship may be moved Upline to a new Sponsor provided the Distributor obtains written authorization from each Distributorship it moves above in Sponsorship.

  4. Sponsor Change Process. A Distributorship may be moved to a new Sponsor within its original Sponsor's Downline Organization if the Distributor obtains the written authorization of the original Sponsor and the Distributor itself, provided that the request receives all 6 levels of upline consent (if applicable). A Distributorship may be moved to a new Sponsor cross-line to the original Sponsor's Downline Organization if the Distributor is an Associate and has been inactive for a minimum of 6 months.

  5. Selling or Transferring a Distributorship. A Distributorship sale or transfer occurs when a Person assigns, sales, or transfers ownership or control of a Distributorship to another Person.

    A Distributor may sell, assign, or otherwise transfer the Contract, subject to the conditions herein. The transferee Distributor will retain the same Downline Organization and the same Rank/Title held before the approved transfer.

  6. Right of First Refusal. Distributorship transfers are subject to a Right of First Refusal ("RFR") to the Company, followed by a RFR to the transferring Distributor's direct Placement Upline who is not in violation of the Contract and who the previous month qualified for earnings under the Compensation Plan (the "Qualified Direct Upline", as used in this section only).

    1. If a Distributor receives a Bona Fide Offer (as hereinafter defined) to purchase his or her Distributorship Rights, the Distributor shall first offer to sell such Distributor Rights to the Company on the same terms and conditions contained in the Bona Fide Offer. The Distributor shall deliver the Bona Fide Offer in writing to the Company, and the Company shall have fifteen (15) business days in which to accept the offer. A "Bona Fide Offer" is a written offer to purchase the Distributorship Rights by a Person that is not a Distributor, which the Company, in its sole discretion, determines to be a legitimate offer. Evidence of a legitimate offer may include, but is not limited to, cash or securities deposited into an escrow account, evidence of a loan commitment, and other substantial steps taken for the sole purpose of purchasing such Distributorship Rights.

    2. If the Company fails to exercise its RFR within the fifteen (15) day time period, the Distributor shall extend the same offer to its Qualified Direct Upline on the same terms and conditions as those contained in the Bona Fide Offer. The Company shall convey the Bona Fide Offer by providing written notice of the same to the Distributor's Qualified Direct Upline. The Qualified Direct Upline shall have ten (10) business days in which to accept or reject such offer. If the Qualified Direct Upline accepts the offer, he or she must provide written notice to the Company upon acceptance.

    3. If the Qualified Direct Upline fails to exercise his or her RFR within the time allotted, the Distributor may transfer the Distributorship to the third party according to the same terms and conditions contained in the Bona Fide Offer, provided, however, that the Distributor comply with all other transferring procedures contained in this Section and as may be established from time to time by the Company.

    4. The RFR shall apply to each new Bona Fide Offer received by the Distributor.

    5. The following circumstances are not subject to the RFR requirements in subparagraph 1 above; however, each instance requires that an amended Distributor Agreement and Statement of Beneficial Interest be filed with the Company.

      1. When the name of a Person who has a Beneficial Interest in the Distributorship is added to the Distributor Agreement (e.g., a wife adding her husband).

      2. When the name of a Person who no longer has a Beneficial Interest in the Distributorship is removed from the Distributor Agreement (e.g., a member who is removed from a limited liability company or a shareholder who sells all of his or her interest in a corporation.)

      3. When the Distributor is an individual and is transferring his or her ownership rights to a legal entity in which only that Distributor has a Beneficial Interest (e.g., a husband and wife form a limited liability company to operate their Distributorship and are the only members/ managers).

  7. Limitations on Sales and Transfers.

    1. An existing Distributor may not purchase another Distributorship.

    2. A Distributor who sells or transfers his or her Distributorship may not reapply to become a Distributor under another Sponsor for a period of not less than six (6) months after the Company has approved the sale.

    3. The Company must first give express written approval for any Distributorship sale or transfer, which the Company may grant or deny at its sole discretion.

    4. Should a Distributor transfer his or her Distributorship and Distributorship Rights to the Qualified Direct Upline, the Distributorship will be merged into the Qualified Direct Upline's existing Distributorship in accordance with the Distributorship transfer procedures.

  8. Process. Additional processing requirements include:

    1. The selling/transferring Distributor must either provide or have on file a current and accurate Distributor Agreement for all Business Entities requesting the transfer.

    2. An application for a sale or transfer must be received by the Customer Service department at the Company by the 20th day of a month in order for the change to be effective for the given month.

    3. Any requests received after the 20th will be processed for the following month.

    4. A one hundred dollar ($100 USD) fee will be assessed per each request.

    5. An additional thirty-five dollar ($35 USD) fee may be assessed for any application that is incomplete, incorrect, or rejected.

  9. Interpretation. The interpretation of these Policies & Procedures pertaining to sale or transfer of a Distributorship will be made in a manner that considers and serves the best interests of the Company. The Company reserves the right to reject any transferee or buyer.

  10. Change of Residence: If a Distributor changes his or her country of residence, the Distributor must submit to the Company: (i) a Distributor Agreement for the new country of residence; (ii) a signed and dated notification request (iii) authoritative documentation as proof of the new residence (e.g., a copy of the driver's license, passport, etc.); and (iv) a one hundred dollar ($100USD or local currency equivalent) processing fee. The Distributor will be responsible for complying with all terms and conditions of the Contract, including those specific to the new country of residence.

Section 5 - Compensation

  1. Earnings Through Sales. Commissions are paid to Distributors who qualify pursuant to the Compensation Plan and who are in compliance with the Contract. A Distributor's success is only achieved through the regular and repeated Retail Sale of Products and the regular and repeated Preferred Customer by its Downline Organization. As the success of any Distributor depends largely on the personal efforts of that Distributor, the Company does not guarantee any level of profit or success, nor does it guarantee a Distributor a specific income.

  2. Payment. The Company will pay Commissions to qualified Distributors on Product orders which: i) are received by the Company before the end of the Commission period, and ii) have been fully paid with appropriate payment. A Distributor does not receive compensation for sponsoring or recruiting other Distributors.

    1. Commissions are paid in the name of the Business Entity listed on the Distributor Agreement. When no Business Entity is listed, Commissions are paid to the personal name of the first Person listed on the Distributor Agreement.

    2. Regular commissions and bonus pool commissions are paid on or around the 15th day of each month (i.e. the next business day if the 15th falls on a weekend). All non-online orders must be received by the Company before 5:00pm Eastern Standard Time (-5 UTC Standard) on the last business day of the month to be included in that month's UniLevel Commission calculation. Online orders must be received by the Company before 11:59 pm Eastern Time on the last day of the month to be included in that month's Commission calculation.

    3. If a Distributor believes that there is an error in the computation of Commissions and/or program qualifications, the error must promptly be brought to the attention of the Company. If such problems are not presented to the Company in writing within forty-five (45) days after the end of the relevant Commission period, the Distributor waives all recourse with respect to such alleged error.

  3. Reissued Checks. In the event that a Commission check must be reissued to a Distributor, the Company will charge the Distributor the stop payment fee charged by the bank. This fee does not apply to Canadian distributors since Direct Deposit is not an option for them at this time. If a check must be reissued because of the Company's error, no additional charge will be applied.

  4. Minimum Check Amount. The minimum amount for payment of commission and bonus checks is four dollars ($4 USD). Commissions and/or bonuses in an amount less than four dollars ($4 USD) for a pay period will be placed in the distributor's account with the Company as an on-file credit to be used towards future orders.

  5. Returned or Unclaimed Checks The Company makes every effort to ensure that a Distributor receives its commission checks. However, if a commission check has been sent to a Distributor's last known address but is returned because the Distributor has moved without a forwarding address or the check is returned or not presented for payment for some other reason beyond the control of the Company, the check shall be voided and the amount may be credited to the Distributor's account 60 days after its date of issue, which credit may be subject to a monthly maintenance fee. Checks that are not cashed within 60 days are null and void. Upon request, Scent-Sations may place the full amount of the check on the Distributor's account as an on-file credit to be used on future orders.

  6. No Manipulation Manipulation of the Compensation Plan is not permitted and may result in disciplinary action. Manipulation of the Compensation Plan includes, but is not limited to, a Distributor purchasing, to qualify for various Ranks or Commissions, large quantities of Product that are not sold through the direct marketing channel, placing orders in his/her Downline Organization, and any other actions that may violate state, federal or foreign anti-pyramid scheme laws. Such manipulations may, in the discretion of the Company, result in the suspension of Commissions and termination of the Distributorship.

  7. Deductions and Offsets. The Distributor authorizes the Company to deduct fees from its Commissions as deemed appropriate in accordance with Section 6 herein or of any term or condition of the Contract. Any fees will be assessed at the sole discretion of the Company.

Section 6 - Ordering Company Products

  1. Inventory. As the Company imposes no specific minimum inventory requirement on its Distributors, a Distributor must use its own judgment to determine the amount of inventory it will need to sustain its projected Preferred Customer and personal use.

  2. Ordering. Products can be ordered by telephone, mail, facsimile, Internet, or by direct request at the Company's corporate headquarters.

    1. Faxed, mailed, or personally delivered orders must be submitted using a current Distributor price list and a fully completed order form.

    2. Payment must be the exact amount of the order and may be made by those methods presently available including cashier's check, money order, credit card, cash, and direct debit. Personal and/or business checks are not accepted methods of payment. Bank wire transfers may be available for high volume orders only.

    3. Orders need to be paid in full prior to pick-up or shipping. All shipping and handling costs are based on delivery location and the amount of Products ordered.

    4. Unauthorized use of another Person's credit card is strictly prohibited.

    5. An order placed over the phone is not deemed made to the Company until the Company sales or customer service agent provides the Distributor or Customer an order number.

    6. All orders are considered final once an order number is received and cannot be canceled.

  3. Back Orders. The company does not take backorders for product. If the Company is temporarily out of stock on ordered Product due to high demand for a given product in a certain time frame, the Distributor will receive notification from the company prior to completing the order. Volume on all orders is credited to the month in which payment for the ordered product(s) are received by the Company.

  4. Electronic Funds Transfer (EFT). This method of payment, also known as ACH, may be an option for the purchase of Products and payment of Commissions to Distributors in certain Authorized Countries. When a Distributor sets up an EFT method to purchase product or receive Commissions, he or she is authorizing the Company to electronically debit or credit his or her bank account on a recurring basis for the amount of any designated purchase or payment, subject to the laws of the Authorized Country where the Distributor resides.

    1. In order to establish EFT as a purchase or payment method, an eligible Distributor must submit the required forms to a Company customer service representative. The forms vary by country, and are located on the Company's corporate website under the specific country link. There may be a waiting period for EFT implementation.

    2. EFT may be used for all orders except for a Distributor's Initial Order (in some Authorized Countries). For the first ninety (90) days or more, orders using EFT may be subject to a shipping hold of up to seven (7) calendar days in order to verify funds.

    3. A Distributor's use of a bank account belonging to another person for EFT purchases requires written, notarized authorization by the owner of the account. Failure to obtain proper authorization constitutes a breach of Contract.

  5. Payment Default. Any payment that is not supported by sufficient funds or that is returned uncollected constitutes a breach of the Contract.

    1. When there are not sufficient funds available, the Distributor is responsible for all bank charges plus the Company's handling fee. Scent-Sations will not reimburse overdraft charges as a result of insufficient funds in a distributor's checking or debit card account. In the case of the EFT method, the Distributor understands that when the Company's first attempt to receive an EFT payment is unsuccessful, the bank may make a second attempt within three (3) days. The Distributor's bank may charge an insufficient funds fee for each unsuccessful attempt which is the sole responsibility of the Distributor. If there are insufficient funds, the Company will put a hold on the Product or cancel the shipment. If the Product has already been shipped, the Distributor will be expected to immediately use an alternate means of payment for the Product. If payment is not received within a reasonable amount of time, the Company may proceed with collection measures, stop the future shipment of orders, place the account on hold, and take any other recovery steps available to it under the Contract, including withholding future commissions.

    2. Any uncollected amount may be deducted from the Distributor's present or future Commissions.

    3. The Distributor understands that all Persons listed on the Distributor Agreement, or any Person having a Beneficial Interest in the Distributorship, will be held jointly and severally liable for the outstanding amount for unpaid Product and fees. It is expressly understood by the Distributor that this joint and several liability supersedes any limitations of liability otherwise available to the Distributorship or its Beneficial Interest holders.

  6. Seventy Percent Rule. A Distributor certifies with each new Product order that he or she has sold or consumed at least 70% of all Product purchased in prior orders. Each Distributor that receives Commissions and orders additional Product agrees to retain documentation that demonstrates compliance with this policy, including evidence of Preferred Customer, for a period of at least four (4) years. A Distributor agrees to make this documentation available to the Company at the Company's request. Failure to comply with this requirement or falsely representing the amount of product sold or consumed in order to advance in the compensation plan constitute a breach of the Contract and is grounds for termination. Furthermore, a breach of this requirement entitles the Company to recover any Commissions paid to the Distributor for any period of time during which such documentation is not maintained or for which this provision has been breached.

  7. Sales Tax, GST, VAT.

    1. U.S. sales tax is collected on the Product's suggested retail price and is calculated using the applicable rates for the location to where the product is shipped including any and all state, local and any special taxes. The Company will collect and remit sales tax to the proper taxing authority. In those jurisdictions where a Distributor may and has registered as a withholding agent through a local sales tax agency and submitted a "Sales and Use Tax Exemption Certificate" or equivalent document to the Company, the collection of sales tax will be the responsibility of the Distributor. It is the responsibility of the Distributor to provide an updated copy of its certification for exemption from sales tax each year unless there is no expiration date on the Certificate.

    2. In Canada, Scent-Sations, Inc. collects and remits the entire GST and PST (or HST where applicable) to the government and the individual Provinces based on the Manufacturer's Suggested Retail Price (MSRP) to the Government. As a result, Canadian Distributors are not eligible for the input tax credit. In provinces that have a Harmonized Sales Tax (HST) the full amount (GST and PST) on the MSRP of the product is collected and remitted by Scent-Sations to that taxing authority.

    3. In all other jurisdictions, GST, VAT, or other applicable transaction tax is based on whatever the law in that country states must be collected, either on wholesale cost or retail price of products and remitted accordingly.

  8. Notice of Cooling-Off Period to Customers. When making a retail sale, a Distributor shall verbally disclose the Customer's rights to cancel the sale. Sales receipts must be completed and delivered to the Retail Customer upon making the sale. The sales receipt is the responsibility of the distributor. If the Customer exercises the right to cancel the sale, the Distributor making the sale shall follow the refund procedures described in this section. The Customer should return all unused Product.

  9. Returns, Refunds, and Exchanges.The Company will refund the purchase price of Product or exchange it pursuant to the following. All product returns must have a Return Authorization Number received by calling corporate prior to shipping defective product(s). Scent-Sations will NOT refund or replace any product that is returned for any other reason other than a defective product. Scent-Sations will honor refund policies provided by any state or federal law applicable to distributor.

    1. If a Distributor is not satisfied with the Product of the Initial Order, he or she may return the entire Initial Order in resalable condition IF they have decided to cancel their Distributorship within thirty (30) days of purchase for a refund*. Refunds are ONLY issued when a Distributor has decided to terminate their distributorship. This refund will be less shipping charges and less a 15% restocking fee for product returned with a valid RMA number, or a 30% restocking fee if returned without an RMA number. Returned Product must be sent through a form of delivery that can be traced (e.g., UPS) and must be received within seven (7) days of contacting the Company. Upon receipt, the return will be noted and a refund will be issued to the Distributor within thirty (30) days. Any additional orders that may have been made within thirty (30) days of the Date of Sign-up will be subject to all standard return Policies. This Initial-Order policy also applies to Customers who ordered Product directly from the Company (if applicable). Acceptable refund methods are limited to the original form of payment, or if not available, such other form as the Company may choose. *Bella Blowouts are retired scents and are not eligible for a refund.

    2. For orders returned other than the Initial Order, the Company will issue an in-house credit to be used on future orders, less shipping charges and less a 15% restocking fee for pre-authorized returns (those sent in with a Return Merchandise Authorization / RMA number) and a 30% restocking fee for unauthorized returns (those sent in without a Return Merchandise Authorization / RMA number) and subject to the limitations herein. Defective or damaged product(s) may be returned for replacement only. Shipping costs will be borne by Scent-Sations for defective products only. A Distributor (and his or her Customer who ordered directly from the Company) requesting a replacement may contact Customer Service to obtain a return merchandise authorization (RMA) number from the Company. Product sent to the Company without an RMA number will not qualify for a return and will be returned to the Distributor at the Distributor's expense. Returns are subject to the following conditions:

      1. The request for a replacement for damaged or missing products must be made within 48 hours of receipt;

      2. The 70% rule in paragraph I above (Distributors only);

      3. The product being returned in a marketable condition (unopened, unaltered and resalable) as determined by the Company

      4. Refunds will only be issued when the Distributor submits in writing that they wish to cancel their distributorship.

    3. Exceptions to the refund policies may be extended by the Company in instances in which Distributor misconduct, misrepresentation, or other extenuating circumstances may require. Previously paid Commissions or Ranks may be reversed and/or adjusted as a result of the exceptions and at the sole discretion of the Company.

    4. Any Commissions paid to the Distributor and his or her Upline for the Product returned by the Distributor may be debited from the respective Upline Distributor's account or withheld from present or future Commission payments. A Distributor agrees that he or she will not rely on existing downline Volume at the close of a commissions period, as returns may cause changes to his or her Title, Rank and/or commissions payout.

    5. All shipping or courier costs for the return of Product will be borne solely by the Distributor unless otherwise prohibited by law. Any damage or loss that occurs to returned Product during shipping will be the responsibility of the Distributor. Should the Product arrive at the Company damaged (thereby rendering it non-resalable), the Company will reject the shipment. It is recommended that a reliable, traceable courier service be used for shipping and be insured. Partial case or partial kit returns will not be accepted or refunded.

    6. The Company will exchange Product if the Product is damaged in shipment, incorrectly sent due to a Company error, or of substandard quality. However, when an exchange is not feasible, the Company will place on on-file credit for the amount of the returned Product. If Product is damaged or missing, a Distributor should contact the Company within 48 hours of receipt of the order. It is the responsibility of the Distributor to inspect the contents of their order(s) within 48 hours of receipt to qualify for replacement of damaged or missing goods or they will be rejected. The Company will issue a call tag for Defective Products only and immediately send a replacement order once the defective product from the Distributor is confirmed to be in route back to the Company. The Company will inspect the Product upon receipt and either approve or deny the claim based on said inspection. All RMAs for returns, missing or damaged items will be issued an in-house credit to be used on a future order which must be called in to be used. If you opt not to have a product sent back to you, and the product is not in re-salable condition, you forfeit the cost of the product and no in-house credit will be issued.

    7. On RMAs for defective products that are found to NOT be defective, if a Distributor wishes to have the product returned to you, shipping charges (and tax if applicable on the shipping) will be levied for the cost to ship the product back to the Distributor.

  10. Buy Back. The Company will buy back unused Product and sales material in resalable condition that has been sold to a Distributor who voluntarily terminates the Contract pursuant to Section 9, Termination. Written notice of a Distributor's voluntary termination is required to obtain a refund upon returning the distributor kit and/or sales material.

  11. Reimbursable or uncollected charges or fees. If for any reason your order is not properly charged due to a problem related to obtaining tax information electronically from our sales tax provider (such as from an Internet outage, computer problem, or other reason beyond Scent-Sations, Inc's control), from an outdated sales tax license, improper calculation of freight charges due to changes in shipping carrier freight charges, fuel or other surcharges, or any other reason, your credit card on file will be charged the amount due. If your card in unable to be charged, future commissions due may be withheld in order to recover any amounts not paid.

Section 7 - Marketing the Product and Opportunity

  1. Use of Sales Tools. A Distributor may use only Sales Tools approved by the Company for an Authorized Country or a country subject to an announced Pre-Launch Period. The Distributor agrees that if it uses a fulfillment house or other third party to sell or distribute Sales Tools, the Distributor will enter into a non-disclosure agreement (to be provided by the Company) with the fulfillment house or third party to ensure that all Distributor and Customer information is protected from disclosure and remains the sole property of the Company.

  2. The Network as Proprietary Property. You acknowledge and agree that: the Network is protected as a valuable, proprietary, trade secret asset that is owned by the Company, The Network has been developed for the exclusive benefit of the Company and Distributors as they promote authorized business activities and Products of the Company through the Network; (iii) the protection of the Network is fundamental to the ongoing success of both the Company and its Distributors; and a violation of your obligations inflicts irreparable harm to the Network, to the Company and its Distributors.

  3. Based on the foregoing, you agree that the following would constitute an unwarranted and unreasonable interference with the contractual relationship between the Company, its Distributors and customers, and damage the competitive business interest and integrity of the Company and Network.

    1. Sale of Third-Party Products and Services. You may not, in any manner, directly or indirectly, promote, market or sell the products or services of another Business Entity or Individual to the Network unless you have a pre-existing business relationship with that Distributor prior to one of you becoming a Distributor. For example, if you own a convenience store, and as a Distributor you sponsor one of your customers, who then becomes a Distributor, then you may continue selling your customer your services and products from your convenience store. Notwithstanding the foregoing, you may not offer third-party products, services or opportunities in conjunction with the sale of Products, or package third-party products, services or opportunities with Products, or offer or promote third-party products, services or opportunities at Company or Distributor meetings, calls or any other Company-related functions without the prior written consent of the Company.

    2. Recruit to another Direct Sales Company. You may not, in any manner, directly or indirectly, recruit, solicit, or sponsor any Distributor or customer, to (i) form a relationship with, (ii) promote, sell or purchase the products or services of, (iii) participate as a salesperson of, (iv) or otherwise associate with, a Direct Sales Company, or encourage any Distributor or customer to do so or to terminate their relationship with the Company.

    3. Survival of Obligation.Your obligations under this Subsection survive for a period of two years from the date of your resignation, termination, transfer or other change in ownership status of your Distributorship.

    4. Injunctive Relief. In addition to other compensatory damage awards to the Company, temporary and permanent injunctive relief is an appropriate remedy to prevent further damage to the Network and the Company.

  4. Approval of Sales Tools. A Distributor must submit all Sales Tools to the Company through the VP of Marketing for approval prior to use. The Company has complete discretion whether to approve or reject a proposed Sales Tool. The approval process generally requires a minimum of three (3) weeks to complete. To comply with changing laws and regulations, the Company may rescind its prior approval of a Sales Tool, and may require the Distributor to remove from the market at its own cost and obligation a previously approved Sales Tool. If approved, the Company will issue to the Distributor written authorization from the Company specifically stating that the Sales Tool may be distributed

  5. Product Claims. The only claims and representations Distributors may make regarding Products are those found in the literature distributed by the Company. Any third-party material used for Distributor Business must comply with all federal and local laws and regulations. All Distributors must read and abide by the concepts outlined in these Policies and Procedures. A Distributor may not make any expressed or implied medical claims relating to any Product. Under no circumstances may a Distributor prescribe any Product as suitable for a particular ailment. No claims may be made as to therapeutic or curative properties of any Product offered by the Company.

  6. No Endorsement Claims. No Distributor may imply that the promotion, operation, or organization of the Company has been approved, sanctioned, or endorsed by any governmental regulatory authority. No Distributor should claim or imply that any Product is approved by any governmental agency.

  7. Use of Trademarks and Copyrights.

    1. The Company may license the use of its trademarks to Distributors, subject to the limitations herein and subject to the limitations in any licensing agreement. The approval or denial of these requests may be requested from the VP of Marketing.

    2. Distributors may not use any of the Company's current or after acquired trademarks or any confusingly similar variations of its marks, in a manner that is likely to cause confusion, mistake, or deception as to the source of the products or services advertised.

    3. The Distributor agrees to immediately re-assign to the Company any registration of the Company names, trade names, trademarks, or Internet domain names registered or reserved in violation of this policy. The provisions of this section survive the termination of the Contract.

    4. Distributors may not use the Company's trademarks on non-approved Sales Tools.

    5. The Company, in its sole discretion, will determine whether a variation of its trademark is confusingly similar.

    6. Distributors shall not use the Company's marks in countries where it is prohibited.

    7. A Distributor must not use the name, logos, trademarks or other references to the Company's business or manufacturing partners in any Sales Tool, correspondence, or any form of advertising without the Company's express written consent.

    8. The Company's literature and media are copyrighted by the Company and may not be duplicated without written consent.

  8. No Altering. Distributors shall not re-label, alter or repackage any Products. Doing so is in direct violation of these Policies and Procedures and may cause the company to seek legal action again the distributor.

  9. Use of "Independent Distributor" in Advertising. If a Distributor selects a business title, the title must clearly state that the Distributor is a "Scent-Sations, Inc. Independent Distributor". A Distributor's title may not imply that the Distributor is an employee or agent of the Company. Each time the Company's logo or name is used in writing and in relation to the Distributor, the Distributor must identify itself as a "Scent-Sations, Inc. Independent Distributor".

  10. Methods of Advertising. Distributors may advertise using the following means:

    1. Newspaper: A Distributor may place a generic business opportunity advertisement in the classified section of a local newspaper, provided the advertisement conforms to all applicable laws and regulations. A sample of approved ads can be found in the Roadmap to Success document in the Back Office.

    2. Phone Directory: Any Distributor may place a text listing of its name in the white or yellow pages of a telephone directory followed by "Scent-Sations, Inc. Independent Distributor".

    3. Electronic Mail Advertisements: All advertisements sent via e-mail, telephone, or facsimile must comply with all anti-spamming laws for the state or country where the intended recipient resides. The Distributor is under obligation to research and comply with all laws concerning unsolicited commercial e-mail.

    4. Television and Radio: Television and radio advertising requires prior written approval from the Company. Requests should be submitted through the Vice President of Marketing.

    5. Celebrity Endorsement: A Distributor may use a celebrity endorsement with written approval from the Company and the specific, prior, written approval of the endorsing celebrity for each use of the celebrity's name.

    6. Fairs, Swap Meets, Etc.: A Distributor may sell or promote Products at bazaars, flea markets, fairs, swap meets, or other similar gatherings. A Distributor may promote and sell Products at trade shows, except those where the Company announces it will have an exclusive presence. Distributors who register for any of the above events must register as "Scent-Sations, Inc. Independent Distributor" and must check with the venue to determine whether or not an Independent Distributor is already registered. If another Independent Distributor is already registered, it is a violation of these Policies and Procedures to register. Doing so will hurt the sales and recruiting efforts of both distributors and so the company does not allow multiple distributors from registering at any given event.

    7. Company-Sponsored Events: At Company-sponsored events, Distributors may not sell or promote non-Company products or services, or use any form of promotion deemed inappropriate by the Company.

    8. Internet Auction Sites: A Distributor may not sell or facilitate the sale of Product on Internet websites where an auction is the mode of selling or buying (e.g., eBay). A Distributor may not use a third party to place Product on auction websites. The provisions of this section survive the termination of the Contract.

  11. Public Relations Matters. The Company encourages Distributors to utilize personal media coverage to expand and build their business; however, certain situations require the Distributor to contact the Company. These would include:

    1. instances where the story or medium has national potential;

    2. cases where the story calls for a wider company/Product perspective; and/or

    3. when the Distributor is questioned about company sales figures and/or business strategies.

  12. Income Claims Prohibition. A Distributor is prohibited from displaying to Distributors and Applicants or potential Applicants commissions checks, personal earnings, Downline Organization earnings, or other sales figures, projections, or income amounts from his or her Distributor Business.

  13. Health Claims Prohibition. A Distributor is prohibited from making any health claims of any kind with regard to the Product except for those claims, if any, that are published in Company literature approved for the country in which the claims are presented.

  14. Internet Advertising. Distributors may use only the Company-licensed Internet websites to promote Products or the business opportunity over the Internet. Promoting Products or the business opportunity through an unlicensed Internet website is strictly prohibited. Distributors that wish to operate licensed personal web sites for the purposes of promoting themselves must meet the following criteria:

    1. A Distributor may not enter into a web site licensing agreement until it has been approved by the Company

    2. Distributors can use web sites that are designed and provided by the company to promote their businesses. Only official Scent-Sations produced web sites shall be permitted. If a Distributor has a personal web page or a web page for another business, the Distributor may place a Scent-Sations approved banner, informational logo or approved verbiage on such web site that will link to the distributor's Scent-Sations web site. No Scent-Sations banners or any other materials relating to Scent-Sations may be placed on any web site that contains any pornographic or obscene material, or material that, at Scent-Sations sole discretion, would tarnish or damage its image or reputation. In consideration of the Company’s recognition, Bonuses, and other compensation that you receive as a Distributor, you will not disparage the Company, or any other company or person, including but not limited to other Distributors, the Company’s Products, the Sales Compensation Plan, the Policies and Procedures or Company employees. Disparagement may result in termination of your Distributorship.

      Violations can lead to immediate termination of distributorship.

    3. Distributors may not use any key words or meta tags to advertise any licensed website on the Internet if the search words or meta tags explicitly or implicitly present illegal or unsubstantiated health or income claims.

    4. The Company may revoke the license for any previously approved website at any time and for any reason, including changes to federal and local laws and regulations.

    5. With the rapid rise of "social networking" web sites such as Facebook and MySpace, the following verbiage has been approved by Scent-Sations and is allowable on such sites:

      "Mary Smith, Independent Distributor for Scent-Sations, Inc., home of Mia Bella's Gourmet Candles"

  15. Retail Establishments: Scent-Sations offers a Vendor Program which allows small retail outlets to sell at retail all Scent-Sations products.

  16. Service Establishments: A Distributor may conduct Distributor Business through Service-related Establishments, except that no Product banners or other Sales Tools may be displayed to the general public in a manner that would attract the public into the Service-related Establishment. The Company has sole discretion in determining whether an establishment is a service-related establishment and a proper place for the sale of Products.

  17. Lead Distribution. Persons who are outside the Company network often make inquiries to the Company about its Products. If the Company is able to determine that the inquiring Person received the information from a specific Distributor or that there is a particular Distributor that the Person is acquainted with, every attempt will be made to refer the Person to that Distributor. If an association with a particular Distributor cannot be determined, the Person will be randomly positioned under an existing Distributor in a Leadership Position. Final judgment with respect to the positioning of leads remains the right of the Company.

  18. Advertising at Corporate Sponsored Events. Distributors may not promote their own events, systems or materials, including, but not limited to organized person to person solicitations, flyers and DVDs, at any event sponsored by the Company unless specifically authorized in writing by the Company.

  19. Mass Communications. For purposes of this paragraph, "Mass Communications" are defined as communications intended to reach fifty (50) or more Distributors in the sender's Downline Organization or at least three Distributors who are cross-line, within a seven (7) day period. The following rules apply to all Mass Communications issued by a Distributor:

    1. Distributors targeted to receive the of Mass Communications must have knowingly "opted in" to hear or receive the Mass Communication

      1. through registration (if the Mass Communication will be received at an event or webinar); and/or

      2. through an affirmative request if the Mass Communication is delivered through an email or on a website.

    2. If by e-mail, there must be an "opt out" feature prominently displayed in the Mass Communication.

    3. The Mass Communication must comply with the terms of this Section.

    4. The following disclaimer shall be prominently positioned in all Mass Communications that promote any particular building method:

      "There are many methods and techniques that may be used to successfully build your Scent-Sations, Inc. business. The building method promoted [in/at] this [website/webinar/email/meeting/] may be different from that which is taught by your upline. Please consult with your upline if they have taught you a different building method or if you have any questions."

    5. Distributor acknowledges that allowing the Distributor to create databases of distributor information for Mass Communications, the sale of tools, and for any other purposes may be a substantial financial benefit to the Distributor. To allow Distributor to utilize distributor information for Mass Communications. To the extent any court of competent jurisdiction determines that any of the terms of this paragraph are unenforceable, then the parties agree that such court shall enforce the provisions of this paragraph to the full extent allowed by law.

Section 8 - Breach of Contract Procedures

  1. Conditional Obligations. The Company's obligations to a Distributor are conditioned upon the Distributor's faithful performance of the terms and conditions of the Contract. The Company, in its sole discretion, will determine if a Distributor is in breach of the Contract and may elect any or all available remedies.

  2. Remedies. In the event of breach, Company may elect to take no action or to exercise some or all contractual remedies and remedies at law, including, but not limited to:

    1. notify the Distributor either in writing or verbally of the breach and providing a notice to cure the breach;

    2. Require from the Distributor additional assurances of future compliance;

    3. Withhold or deny recognition and attendant perks;

    4. Assess damages and withhold them from commission payments;

    5. Suspend the Distributor Rights temporarily or permanently;

    6. Seek injunctive relief; and

    7. Terminate the Contract.

  3. Reporting Contract Breaches. If a Distributor observes or is aware of another Distributor's violation of any term or condition of the Contract, the observing Distributor shall submit a written complaint to the Company's VP of Marketing. Because of the difficulties of investigating and asserting appropriate remedies for stale claims, any complaint for breach of the terms and conditions of the Contract other than cross-company recruitingmust be brought to the Company's attention for review within eighteen (18) months of the start of the alleged violation; cross-company recruiting violations must be brought to the Company's attention within six (6) months of the alleged violation. Failure to report a violation within that time period may result in the Company not pursuing the allegations in order to prevent the Distributor Business from being disrupted due to stale claims. However, this policy does not waive the Company's right to investigate and exercise stale claims.

Section 9 - Termination

  1. Termination.

    1. A Distributor may terminate the Contract by failing to renew on the annual anniversary of the acceptance of his or her Distributor Agreement (when applicable) or by submitting to the Company in writing a request to terminate.

    2. The Company may terminate the Contract if the Distributor violates the terms of the Contract and any amendments thereto.

    3. Upon termination, the Company may in its sole discretion retain the distributorship or dissolve and remove it from the Sponsorship and Placement trees.

    4. If a distributor voluntarily terminates his/her distributorship (COTM or Associate) any downline organization will be "rolled up" to the next active upline. Scent-Sations, Inc. reserves the right to reinstate said distributor along with his or her downline organization should the company feel that special circumstances require it.

  2. Return of Confidential Information. A Distributor must return all Confidential Information over which he or she has direct or indirect control to the Company upon termination or upon demand of the Company. If any such Confidential Information cannot be returned because it is in electronic format, the Distributor shall permanently delete and erase the Confidential Information upon termination or upon demand.

  3. Buyback: The Company will buy back Products in resalable condition and pursuant to the refund policies in Section 6 from a Distributor who voluntarily terminates their Distributorship. Subject to the restrictions included herein, any distributor kit and sales material, opened or unopened, may be returned within thirty (30) days of the shipping date for a full refund, minus shipping costs. If a Distributorship is in breach, the Company reserves the right to stop or delay the buy-back process until such time as it has determined what, if any, actions are have taken place.

    1. Product/Literature Returns: Any Distributor who chooses to terminate his/her distributorship may return literature and/or products that are in resalable condition at any time within 30 days of purchase and receive an 85% refund with a Return Authorization Number. Shipping costs will be borne by distributor on sales and returns (Refused packages returned without a Return Authorization Number will receive a 70% refund less shipping on sale and return of items). Defective product(s) may be returned for replacement only or 100% refund only when terminating a distributorship. Shipping costs will be borne by Scent-Sations for defective products ONLY, not for product returns. All product returns must have a Return Authorization Number issued by calling corporate prior to shipping defective or damaged product(s) back to the company. The RMA number must be clearly marked on the outside of the box. Scent-Sations will NOT refund or replace any product that is returned for any other reason other than a defective or damaged product. Scent-Sations will honor refund policies provided by any specific state or federal law applicable to where the distributor resides. (See Section 6 - Ordering Company Products for additional information.)

  4. Effects of Termination for Breach of Contract.

    1. A Distributor whose Contract is terminated by the Company must wait six (6) months before applying for a new Distributorship. During that time, the Distributor can have no Beneficial Interest in any other Distributorship. Prior to applying, he or she must first petition the Company through the Customer Service department. The petition will include an affidavit that must be signed under penalty of perjury and notarized in which the Distributor confirms that he or she has had no Beneficial Interest in any Distributorship during the prior one year.

    2. Upon termination, a Distributor's license to the Distributorship is revoked and all rights to the Distributor Business are terminated. Any unpaid commissions may be withheld by the Company for 30 days beyond their due date to determine damages, if any. If damages are assessed, the Distributor consents to the damages being offset from the commissions.

    3. Where the Company elects to revoke a license to a Distributorship in which there is more than one Beneficial Interest holder, the following may apply:

      1. the departing Beneficial Interest holder(s) must relinquish all rights to, and interests in,the Distributorship;

      2. The Company may not divide nor reassign any of the Downline Organization; and

      3. The Company may not split Commissions between the prior or current Beneficial Interest holders of the Distributorship.

  5. Effects of Voluntary Termination by the Distributor.

    1. The Contract can be voluntarily terminated by a Distributor who is not in breach of the Contract for any reason, at any time, by providing written notice to the Company signed by all Person(s) listed on the Distributor Agreement. The termination is effective on the date the Company receives the written notice, although processing of the termination request may be delayed until the following month if there is current Volume in the Distributorship.

    2. Upon termination, a Distributor's license to the Distributorship is revoked and all rights to Distributor Business are terminated.

    3. A Distributor who voluntarily terminates may re-apply for a new Distributorship under a new Sponsor no earlier than six (6) months from the date the Company receives written notice of the termination.

    4. A Distributor may not terminate voluntarily if the Distributorship is not in good standing with the Company.

Section 10 - Miscellaneous

  1. Entire Agreement. The Contract contains the entire understanding concerning the subject matter hereof between the Company and the Distributor, and is intended as a final, complete, and exclusive expression of the terms of the parties. This Contract supersedes and replaces all prior negotiations and proposed, but unexecuted agreements, either written or oral. Any prior agreements, promises, negotiations, or representations, either written or oral, relating to the subject matter of this Contract, are of no force or effect. If there is any discrepancy between verbal representations made to the Distributor by any employee or agent of the Company and the terms of the Contract, the express written terms and requirements of the Contract will prevail.

  2. Modifications by the Company. The Company reserves the right to make any modifications to the Contract, provided that the modifications are communicated by the Company to the Distributor at least thirty (30) days prior to taking effect. The Company may communicate these modifications by posting any portion of the modified Contract on the Company's website at, or by any other method of communication. The Distributor is deemed to have accepted the modification to the Contract if the Distributor engages in any Distributor Business, renews its Distributorship, or accepts Commissions after the thirty (30) day period is ended.

  3. Warranties. The Company extends no product warranties, either expressed or implied, beyond those specifically articulated in the Contract. The Company disclaims and excludes all warranties regarding possible infringement of any United States or foreign patent, trademark, trade name, copyright, or trade secret arising from the Distributor's operations

  4. Waiver. Any waiver by the Company of a Distributor's breach of a Contract provision must be in writing and will not be construed as a waiver of any subsequent or additional breach by the Distributor. The failure by the Company to exercise any right or privilege under the Contract will not constitute a waiver of that right or privilege.

  5. Severance. If any term or condition of this Contract is judicially invalidated, prohibited, or otherwise rendered unenforceable in any jurisdiction, it is unenforceable only to the extent of the invalid, prohibited or unenforceable provision in that jurisdiction only, and it will not render unenforceable or invalidate any other provision of the Contract, nor will the Contract be rendered unenforceable or invalidated in another jurisdiction.

  6. Force Majeure. Distributor acknowledges that the Company is not liable for any damages or losses caused by the delay or inability to manufacture, sell, or deliver its products due to labor strikes, shipper problems, accidents, fire, flood, acts of civil authority, acts of God, acts of terrorists, or from any other causes that are beyond the control of the Company.

  7. Governing Law. The State of Pennsylvania is the place of the origin of this Contract and is where the Company accepted the offer of the Applicant to become a Distributor and where the Distributor entered into the Contract with the Company. The Contract is therefore to be construed in accordance with the laws of the State of Pennsylvania as to contracts made and to be wholly performed within the State.

  8. Attorneys Fees. If any suit, action, or proceeding is brought to enforce any term or provision of this Contract, the prevailing party shall be entitled to recover reasonable attorneys' fees, costs, and expenses incurred, in addition to any other relief to which such party may be legally entitled. Unless otherwise required by any arbitration clause herein, any legal action concerning the Contract shall be brought in the state and federal courts located in Wilkes-Barre, Pennsylvania. In the event any court of competent jurisdiction shall declare any portion of the Contract to be invalid, the remainder of the Contract shall not be invalidated thereby, but shall remain in full force and effect.

  9. Successors and Assigns. The Contract will be legal and binding upon and inure to the benefit of the parties and their respective successors and assigns.

  10. Limitation of Liability. To the extent permitted by law, the Company, its directors, officers, members, managers, shareholders, employees, assigns and agents (collectively referred to as "Responsible Parties") shall not be liable for, and the Distributor releases Company and its Responsible Parties from and waive all claims, for any loss of profits, indirect, direct, special or consequential damages, and for any other losses incurred or suffered by distributors as a result of:

    1. Distributor's breach of the Contract,

    2. the promotion or operation of the Distributorship and the Distributorship Business;

    3. Distributor's incorrect or wrong data or information provided to the Company or its Responsible Parties; or

    4. the Distributor's failure to provide any information or data necessary for the Company to operate its business.


  11. Administrative Fees. For any requested administrative tasks such as requests for documentation, paperwork, invoices, copies of agreements, terms, policies, etc. there will be a charge of $5 per document, with a $10 minimum charge. If a Distributor has access to their Back Office, they may save or print copies of any invoices or other documentation that is contained therein. If they have terminated their distributorship, temporary access for 24 hours will be granted upon request to allow the Distributor time to retrieve any historical documentation. This is a one-time courtesy extended to Distributors who have canceled their Distributorship within the past 12 months. Accounts that have been inactive for over a year must pay the per document fee.

  12. Fraudulent Account Activity. If fraud of any kind is discovered on any distributor account, that account will be placed on a policy hold until documents providing proof of ownership are produced. This may include copies of drivers license showing photo and signature, front and back copy of any credit/debit cards in question, copy of Employer Identification Numbers (EINs), Reseller Tax Licenses, and other information deemed necessary to proof identity.

  13. Auto Ship Pickup Orders. Scent-Sations will hold auto ship pick up orders for a period of 365 days (one year). After such time the order will be cancelled and distributor will not be compensated for the loss.

APPENDIX A - Definition of Terms:

The following defined terms apply throughout the Contract, Policies and Procedures, and Terms and Conditions:

Applicant - A Person who has submitted a Distributor Agreement.

Associate Distributor- A Distributor who has not elected to enroll in the auto ship program and is eligible to purchase products from the company at Wholesale prices.

Authorized Country - A country that the Company has officially sanctioned to be available to all Distributors for conducting the Distributor Business.

Below Wholesale Pricing - the price plan at which active autoship Distributors may purchase products at. It is approximately 30% below regular Wholesale pricing which is extended to Assocate Distributors.

Auto Ship Program - An optional program that authorizes the Company to automatically ship Product or points to a Distributor on a recurring monthly basis and allows that Distributor to purchase products at Below Wholesale prices.

Beneficial Interest - A Person is deemed to have a Beneficial Interest in a Distributorship if he/she/it has:

  1. any direct or indirect ownership in a Distributorship as an individual, partner, shareholder, member, manager, beneficiary, trustee, officer, director or principal of a Distributorship;

  2. has any actual or de facto control over a Distributorship;

  3. receives any income directly or indirectly from a Distributorship (other than the receipt of income pursuant to the Compensation Plan by an Upline Distributor);

  4. receives familial support from a Distributorship;

  5. receives spousal support derived from a Distributorship;

  6. is a member of the Distributor's immediate household;

  7. is a spouse or Cohabitant; or

  8. has any other similar interest in a Distributorship.

Business Entity - Any type of business association authorized under the laws of the jurisdiction in which it was organized. This includes, but is not limited to, legally formed: corporations, partnerships, trusts, and limited-liability companies.

Co-habitant - An individual who is 18 years of age or older who shares with another person a common residency and marriage-like relationship.

Commissions - Compensation paid to a Distributor based on the Volume of Products sold by the Distributor and purchased and/or sold by its Downline Organization. Eligibility to receive Commissions is determined by the monthly sales requirements currently in effect, as outlined in the Compensation Plan.

Company - Scent-Sations, Inc., a Pennsylvania corporation or any lawful assignee, successor, subsidiary, or affiliate regardless of geographic location.

Compensation Plan - The specific plan used by the Company that details the requirements and benefits of the compensation structure for Distributors. The Compensation Plan details can be found at Appendix B to these Policies and Procedures.

Confidential Information - Information disclosed in connection with the Distributor Rights, including, but not limited to, information regarding:

  1. Downline Organizations or Upline Distributors, including Distributor names and contact information, customer information developed by Company or developed for and on behalf of the Company by Distributors through Distributor meetings, websites, email and/or profile gathering tools, and any other electronic or manual application used by a Distributor or his agent to gather, store, and/or develop any information about Distributors and customers (including but not limited to credit data, retail customer and Distributor profiles, and product purchase information and

  2. customer lists, manufacturing and supplier information, business reports, commission or sales reports, business plans, projections, trade secrets, analyses, and related information and other financial and business information that would be reasonably understood to be confidential. Confidential Information may take the form of documentation, drawings, specifications, software, technical or engineering data, or other forms, and may be disclosed orally, in writing, by electronic or magnetic media, by visual observation, or by other means.

Contract - The documents describing the specific relationship between a Distributor and the Company, comprising the Distributor Agreement, the Compensation Plan, the Policies and Procedures, the Terms and Conditions, and any country or situation-specific addendum(s) thereto, and any other written agreement between the Distributor and the Company, which documents are incorporated herein by reference.

Cross Company Recruiting - (see Section 2.J.) Cross-line Recruiting Sponsoring, or a solicitation to Sponsor, indirectly or otherwise, another Distributor (or anyone with a Beneficial Interest in that Distributor's Distributorship).

Customer - A non-Distributor that purchases Products at Preferred Customer pricing.

Date of Sign-up - The date the Company receives and accepts an Applicant's Distributor Agreement bearing an original signature or electronic equivalent of an original signature.

Distributor - A Person currently licensed by the Company to operate a Distributorship. If more than one Person is named on the Distributor Agreement, then "Distributor" may refer to all Persons collectively.

Distributor Agreement - The agreement submitted by an Applicant to become a Distributor. In signing the Distributor Agreement, an Applicant certifies that he or she has read and will abide by the terms and conditions of the Contract, company Policies and Procedures, and Terms and Conditions.

Distributor Business - Activities determined at the sole discretion of the Company to be a promotion of the Company's Products or business opportunity. Some of these activities include, but are not restricted to: signing a Distributor Agreement; advertising, selling or exhibiting Product; hosting, conducting, or speaking at meetings or events (whether hosted by the Company or by a Distributor); purchasing Product at Wholesale prices, exchanging, or returning Products; participating in the Compensation Plan, receiving periodic Company literature and other communications, participation in Company-sponsored support service training, motivational and recognition events; and/or sponsoring new Distributors.

Distributor Rights - The rights in the Contract licensed to a Distributor to conduct the Distributor Business.

Distributorship - A defined position within the Company's network of distributors that is the subject of the Contract.

Downline- A genealogically structured organization comprised of Distributors and their Organization's Customers who are below a Distributor in his or her Sponsor Tree or Placement Tree. The Distributors will have been personally Sponsored:

  1. by a Distributor and are downline of that Distributor through Placement or Sponsorship, or

  2. by those who the Distributor has Sponsored or placed through Placement, and their respective Customers, all in a direct chain of Distributorships below the Distributor.

Electronic Funds Transfer (EFT) - An optional program that authorizes the Company to electronically debit a Distributor's bank account for the amount of an order and renewals fees.

Front Line - The Distributors who appear on the first level of the Sponsor Tree of the immediate Downline Organization of any particular Distributor. They may appear through Sponsorship Compression. The CV of Customers is treated as if it were Frontline for purposes of calculating Commissions.

Identification Number - The number issued specifically to an individual or company by the government.
Examples include: social security number (US individuals), social insurance number (Canadian individuals), or employment identification number (US companies).

Initial Order - A Distributor's first Product order with CV, shipped to a single address.

Person - An individual, a Business Entity, or any other entity with a distinct separate existence, and its successors, heirs, or assigns, as the case may be.


  • As a noun: a Distributor who has directly recruited another Distributor into his or her Placement Tree (as defined in the Compensation Plan);

  • As a verb: the positioning by a Sponsor of a Distributor in his or her Downline Organization.

Policies and Procedures - The policies and procedures of the Company contained herein, including attachments and addenda, which are incorporated herein by this reference, as the same may be amended from time to time by the Company.

Pre-Launch Period - A period of time announced by the Company prior to a country becoming an Authorized Country during which a Distributor may begin preparation to commence the Distributor Business within that country.

Product- Any good or service that has Volume assigned to it and that is offered by the Company. Sales tools, marketing and promotional materials and apparel are not included in this definition.

Rank - The current payout qualification level of the Distributorship according to the Compensation Plan. The Rank of a Distributor, which will affect the Distributor's commissions calculated from the Sponsor Tree (as defined in the Compensation Plan), may fluctuate monthly and depends on the Distributor meeting various qualifications outlined in the Compensation Plan.

Retail Establishment - Any enterprise that is not a Service-related Establishment. Examples include, but are not limited to mass market and specialty stores.

Preferred Customer - Sales by a Distributor of the Product to his or her Customers.

Sales Tool - Any information, material or product created by the Company or Distributor for Distributor Business.

Service-related Establishment - An enterprise where the general public typically does not have ready access unless through appointment or membership, and/or where the primary-function of the enterprise is the rendering of professional services rather than selling merchandise. Examples include, but are not limited to private or restricted access offices, spas, gyms, or private associations that may retail some products, but whose primary purpose is to offer a service.


  • As a noun: a Distributor who has directly recruited another Distributor into his or her Downline Organization;

  • As a verb: the act of directly recruiting another Distributor into his or her Downline Organization.

Title - The highest Rank ever achieved by a Distributor that is used for recognition purposes. Titles are never demoted, thus a Distributor holds the highest rank they have achieved at any point in time.

Upline - The single-line hierarchy of Sponsors and/or Distributors extending upward from a Distributorship.

Volume - A value assigned to a Product for commission purposes.

Wholesale - The price the Company charges Associate Distributors for Products. This is not to be confused with Below Wholesale pricing which is the price level extended to autoship Distributors.

APPENDIX B - Compensation Plan

The Compensation Plan is the method by which Distributors are compensated for their Preferred Customer and personal purchases of the Product, as well as the Preferred Customer and personal purchases of the Product by their Downline Organizations. The Compensation Plan is part of the Contract between the Company and its Distributors. Certain defined terms herein appear in title capital letters. These terms and their definitions are described at the end of this document, in the text of this document, or in the Company Policies and Procedures, which are incorporated herein by reference.

Section 1 - Payment of Commissions

  1. The Company pays various types of Commissions for the sale of Product. Commissions are calculated based on the Commissionable Volume (CV) in either the Sponsor Tree or the Placement Tree resulting from of a Product order, a Distributor's Personal Volume (PV), a Distributorship's Group Volume (GV), and other qualifications as described herein.

  2. To the extent that commissionable sales occur where Products are delivered for distribution within the United States, Commissions on those sales under this Compensation Plan will be the legal responsibility of and will be paid by the Company. To the extent that commissionable sales occur where Products are delivered for distribution outside of the United States, Commissions on those sales under this Compensation Plan will be the legal responsibility of and will be paid by Scent-Sations, Inc. DISC, Inc or its assigns. Nevertheless, for administrative convenience, Commissions paid under this Compensation Plan generally may be issued on a single check or similar instrument or transaction, combining for the convenience of the Distributor the Commissions earned for both U.S. and non-U.S. sales.

  3. The Company may deduct necessary handling, processing, or remittance fees from a Distributor's Commissions as set forth in the Policies and Procedures.

Section 2 - Distributor Ranks (see Appendix x for additional Compensation Plan details)

Distributors may qualify for various Ranks by meeting certain requirements, including monthly PV and monthly GV generated in the Placement Tree and total sponsorship requirements. Each Distributor Rank and its requirements that must be met in the month of qualification are as follows:

Basic Compensation Plan Ranks:

  1. Associate Distributor - no monthly PV requirements to purchase products, but a minimum of $39.95 PV must be maintained in order to remain active, retain any downline and receive any commissions due.

  2. Silver Distributor - $39.95 PV and 0 active members

  3. Gold Distributor - $39.95 PV and 1 active front-line member

  4. Ruby Distributor - $39.95 PV and 2 active front-line members

  5. Emerald Distributor - $39.95 PV and 3 active front-line members

  6. Sapphire Distributor - $39.95 PV and 4 active front-line members

  7. Diamond Distributor - $39.95 PV and 5 active front-line members

Advanced Basic Compensation Plan Ranks:

  1. 2K Diamond Distributor - $100.00 PV, 5 active front-line members and at least $2,000 monthly Group Volume (GV) through 6 levels

  2. 5K Diamond Distributor - $100.00 PV, 6 active front-line members and at least $5,000 monthly Group Volume (GV) through 6 levels

  3. 10K Diamond Distributor - $100.00 PV, 7 active front-line members and at least $10,000 monthly Group Volume (GV) through 6 levels

Leadership Level Compensation Plan Ranks:

  1. Double Diamond Distributor - $100.00 PV, 8 active front-line members and at least $18,000 monthly Group Volume (GV) through 6 levels

  2. Triple Diamond Distributor - $100.00 PV, 9 active front-line members and at least $28,000 monthly Group Volume (GV) through 6 levels

  3. Director Distributor - $100.00 PV, 10 active front-line members of which 3 are Personally Sponsored 2K Diamonds and at least $40,000 monthly Group Volume (GV) through 6 levels

  4. Senior Director Distributor - $100.00 PV, 10 active front-line members of which 3 are Personally Sponsored 2K Diamonds and at least $80,000 monthly Group Volume (GV) through 6 levels

Advanced Leadership Level Compensation Plan Ranks:

  1. Platinum Director Distributor - $100.00 PV, 15 active front-line members of which 3 are personally sponsored Directors and at least $200,000 monthly Group Volume (GV) through 6 levels

  2. Senior Platinum Director Distributor - $100.00 PV, 15 active front-line members of which 3 are personally sponsored Directors and at least $300,000 monthly Group Volume (GV) through 6 levels

  3. Ambassador Directory Distributor - $100.00 PV, 20 active front line members of which 3 are personally sponsored Directors and at least $500,000 monthly Group Volume (GV)

Section 3 - Preferred Customer Commissions

Distributors may generate Preferred Customer Commissions by directing Customers to purchase Product under the Distributor's account through their company web site. The Company pays Preferred Customer Commissions on all Product sales to Distributors whose Customers are referred to the Distributor's Preferred Customer web site. The resulting CV from such sales is treated as Personal Volume (PV) to the referring Distributor for purposes of calculating Commissions.


A-1. Governing Law and Arbitration

  1. The State of Pennsylvania is the place of origin of this Contract, and is where the Company accepted the offer of an Applicant to become a Distributor and where the Distributor entered into the Contract with the Company. The Contract is therefore governed by and to be construed in accordance with the laws of the State of Pennsylvania without reference to the conflict of laws principles thereof, and the arbitration provisions herein are governed by the state of Pennsylvania.

  2. Any controversy or claim arising between Company and the Distributor, including any controversy or claim arising out of or relating to the Contract or the breach thereof, or any controversy or claim relating to the business arising between Distributors, shall be resolved by mandatory, binding arbitration in Wilkes-Barre, Pennsylvania, in the United States of America, to be conducted in the English language. Distributor hereby submits to the arbitral jurisdiction set forth herein, and, with respect to any matters not determined by or subject to arbitration, to the personal jurisdiction of the state and federal courts within Wilkes-Barre, Pennsylvania. The arbitration shall be initiated by service of written demand for arbitration on the responding party. Distributor hereby consents to service of such demand by mail to the address for such Distributor on file with the Company and waives all rights and defenses as to insufficiency of service of process as may be applicable under the laws of the United States or any other country.

  3. There shall be one arbitrator, who shall be impartial, independent, and mutually agreed upon by theparties to the arbitration within 30 days following receipt of the written demand for arbitration. If theparties do not reach agreement on a single arbitrator within such period, the parties shall obtain a judicialappointment of an arbitrator.

  4. The arbitration and all pre-hearing matters, including discovery, shall be governed by and conducted in accordance with the Pennsylvania Rules of Civil Procedure and the Pennsylvania Rules of Evidence. The arbitration and all proceedings associated therewith are private proceedings and not subject to any public right of access. The arbitrator shall have the authority to enter appropriate protective orders to preserve the confidentiality of the proceedings and information exchanged in discovery. The arbitrator shall have the authority, power, and jurisdiction to grant both legal and equitable relief, including temporary, preliminary, and permanent injunctive relief, and the parties hereto hereby submit to the jurisdiction of the arbitrator for all such relief. The arbitrator shall also have the sole and exclusive authority to determine whether any particular issue is subject to arbitration under this Agreement.

  5. The arbitration award shall be a reasoned award, given in writing, and shall be final and binding on the parties hereto and not subject to any appeal, except as specifically provided in the appeal provision below. Judgment upon the award rendered may be entered in any court having jurisdiction, or, application may be made to such court for a judicial recognition of the award or an order of enforcement thereof, as the case may be. Execution upon any such judgment shall be governed by the laws of the State of Pennsylvania, and the parties hereto agree unconditionally to recognize an arbitration award rendered in connection with this Agreement as binding and compulsory and subject to execution pursuant to any applicable laws.

  6. Should the Arbitrator enter an award against any party for a sum in excess of fifty-thousand dollars ($50,000), or enter an award constituting permanent injunctive relief against any party, the party against whom such an award has been entered may appeal the award to a private arbitration panel of three impartial and independent arbitrators mutually agreed upon by the parties (the "Appeal Panel"). Any such appeal must be taken by written notice served no later than thirty (30) days after the party has received the written award. If the parties do not agree on three arbitrators within 30 days of the date of the arbitration award, the Appeal Panel shall be judicially appointed in accordance with applicable laws.

  7. The appeal shall be conducted in Wilkes-Barre, Pennsylvania, in the United States of America, in the English language. Upon briefing of relevant issues by the parties, and oral argument if requested by the parties, the Appeal Panel shall review and correct the award for (1) any error of law, (2) a failure of substantial evidence to support all or any element of the award, and (3) an error of a mixed question of fact and law. The arbitration panel shall issue a reasoned decision, given in writing, which shall be final and binding on the parties and not subject to any appeal.

  8. The parties shall equally share the assessed costs associated with the arbitration, including all arbitrator fees; provided, however, that the prevailing party in any appeal to the Appeal Panel shall beentitled to recover its share of the costs of such appeal from the non-prevailing party. The parties shall each bear their own attorneys fees in connection with the arbitration and any appeal, irrespective of which party prevails and any demand or request made for such fees.