Conscious Planet Enterprise Solution Ltd.

STATEMENT OF POLICIES and PROCEDURES

SECTION 1 - INTRODUCTION

1.1 - Policies and Compensation Plan Summarized into Member Agreement

These Policies and Procedures, in their present form and as amended at the sole discretion of Conscious Planet Enterprise Solution Ltd. (hereafter “Conscious Planet” or the “Company”), are incorporated into, and form an integral part of, the Conscious Planet Member Agreement.  Throughout these Policies, when the term “Agreement” is used, it collectively refers to the Conscious Planet Member Application and Agreement, these Policies and Procedures, the Conscious Planet Marketing and Compensation Plan, and the Conscious Planet Business Entity Registration Form (if applicable).  These documents are incorporated by reference into the Conscious Planet Member Agreement in their current form and as amended by Conscious Planet.  It is the responsibility of each Member to read, understand, adhere to, and ensure that he or she is aware of and operating under the most current version of these Policies and Procedures.  When sponsoring or enrolling a new Member, it is the responsibility of the enrolling Member to provide the most current version of these Policies and Procedures and the Conscious Planet Marketing and Compensation Plan to the applicant prior to his or her execution of the Member Agreement.

1.2 - Purpose of Policies

Conscious Planet is a direct sales affiliate membership company that markets products through Independent Members.  It is important to understand that your success and the success of your fellow Members are dependent upon the integrity of the men and women who market our products.  To clearly define the relationship that exists between Members and Conscious Planet, and to explicitly set a standard for acceptable business conduct, Conscious Planet has established the Agreement.

Conscious Planet Members are required to comply with all of the Terms and Conditions set forth in the Agreement which Conscious Planet may amend at its sole discretion from time to time, as well as all federal, state, provincial, territorial, and local laws governing their Conscious Planet business and their conduct.  Because you may be unfamiliar with many of these standards of practice, it is very important that you read and abide by the Agreement.  Please review the information in this manual carefully.  It explains and governs the relationship between you, as an independent contractor and the Company.  If you have any questions regarding any policy or rule, do not hesitate to seek an answer from anyone - your Sponsor/Personal Enroller or from Conscious Planet directly.

1.3 - Changes to the Agreement

Because federal, state, provincial, territorial and local laws, as well as the business environment, periodically change, Conscious Planet reserves the right to amend the Agreement and its prices in its sole and absolute discretion.  By entering into the Member Agreement, a Member agrees to abide by all amendments or modifications that Conscious Planet elects to make.  Amendments shall be effective upon notice to all Members that the Agreement has been modified.  Notification of amendments shall be published in official Conscious Planet materials.  The Company shall provide or make available to all Members a complete copy of the amended provisions by one or more of the following methods: (1) posting on the Company’s official website, (2) electronic mail (e-mail), (3) fax-on-demand, (4) voice mail system broadcast, (5) inclusion in Company periodicals, (6) inclusion in product orders or bonus cheques, or (7) special mailings.  The continuation of a Member’s Conscious Planet business or a Member’s acceptance of bonuses or commissions constitutes acceptance of any and all amendments.

1.4 - Delays

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

1.5 - Policies and Provisions Severable

If any provision of the Agreement, in its current form or as may be amended, is found to be invalid, or unenforceable for any reason, only the invalid portion(s) of the provision shall be severed and the remaining terms and provisions shall remain in full force and effect and shall be construed as if such invalid, or unenforceable provision never comprised a part of the Agreement.

1.6 - Waiver

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

The existence of any claim or cause of action of a Member against Conscious Planet shall not constitute a defense to Conscious Planet’s enforcement of any term or provision of the Agreement.

SECTION 2 - BECOMING A DISTRIBUTOR

2.1 - Requirements to Become a Member

To become a Conscious Planet Member, each applicant must:

a) Commit to support the vision, mission and values of Conscious Planet.

b) Be of the age of majority in his or her state or province of residence;

c) Reside in Canada, the United States, a U.S. Territory, or any country in which Conscious Planet is officially doing business;

d) Have a valid Social Security, Social Insurance, or Federal Tax ID Number, a signed private contract agreement with Conscious Planet or by default participate as a sovereign in full capacity;

e) Purchase a Conscious Planet Membership (not applicable in North Dakota);

f) Submit a properly completed Member Application and Agreement to Conscious Planet (see Section 2.2 below); and

g) Be aware of a Member's Privileges.

The Company reserves the right to reject any applications for a new Member or applications for renewal.

2.2  - New Member Enrollment

Conscious Planet provides four convenient methods for new Members to enroll.  An applicant may: a) mail the Application and Agreement and Member payment to Conscious Planet’s corporate offices, b) enroll online at Conscious Planet’s website or at the personal Conscious Planet website of his or her Sponsor, c) submit the Application and Agreement by fax, or d) call the Conscious Planet home office during regular business hours to receive a temporary Member Identification Number (“ID#”) and temporary authorization for a new Member.  (See the front of the Member Application and Agreement for phone numbers and appropriate business hours.) 

If the applicant enrolls by fax, he or she must fax both the front and back of the Application and Agreement to Conscious Planet at the fax number listed on the Application and Agreement.  For fax enrollments, payment for the Membership must be made by credit card.

If the applicant enrolls by telephone, he or she must be able to provide all necessary Member Agreement information over the telephone and order a Membership using a valid credit card.  The new Member’s ID# and authorization will be valid for 30 days, pending receipt of the completed and signed original Member Application and Agreement by Conscious Planet.  Once the original Member Application and Agreement is received at the Conscious Planet Home Office, the new Member Agreement will be extended to one full year from the date on which the ID# was issued.  If the new Member Application and Agreement is not received within the temporary 30-day time period, the temporary authorization shall expire, the ID# will be canceled, and the Member Application and Agreement will be automatically terminated.

2.3  - Member Benefits

Once a Member Application and Agreement has been accepted by Conscious Planet, the benefits of the Marketing and Compensation Plan and the Member Agreement are available to the new Member.  These benefits include the right to:

a) Purchase Conscious Planet products at the wholesale price,

b) Retail Conscious Planet products and profit from these sales,

c) Participate in the Conscious Planet Marketing and Compensation Plan (receive bonuses and commissions, if eligible),

d) Enroll/Sponsor other individuals as Preferred Customers or Members into the Conscious Planet business and thereby, build a marketing organization and progress through the Conscious Planet Marketing and Compensation Plan,

e) Receive periodic Conscious Planet literature and other Conscious Planet communications,

f) Participate in Conscious Planet - sponsored support, service, training, and recognition functions, upon payment of appropriate charges, if applicable, and

g) Participate in promotional and incentive contests and programs sponsored by Conscious Planet for its Members.

2.4  - Renewal of Your Conscious Planet Business

The term of the Member Agreement is one year from the date of its acceptance by Conscious Planet.  Members must renew their Member Agreement each year by paying an annual renewal fee of $20 on or before the anniversary date of their Member Agreement.  If the renewal fee is not paid within 30 days after the expiration of the current term of the Member Agreement, the Member Agreement will be canceled. Members may elect to utilize the Automatic Renewal Program (“ARP”).  Under the ARP, the renewal fee may be:

(a) deducted from the Member’s bonus cheques for the anniversary month of the Member Agreement, or

(b) charged to the Member’s credit card or chequing account.

SECTION 3 - OPERATING YOUR CONSCIOUS PLANET BUSINESS

3.1  - Adherence to the Conscious Planet Marketing and Compensation Plan

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

3.2  - Advertising

3.2.1 - General

All Members shall safeguard and promote the good reputation of Conscious Planet and its products.  The marketing and promotion of Conscious Planet, the Conscious Planet opportunity, the Marketing and Compensation Plan, and Conscious Planet products shall be consistent with the public interest, and must avoid all discourteous, deceptive, misleading, unethical or immoral conduct or practices.

To promote both the products and the tremendous opportunity Conscious Planet offers, Members must use the sales aids and support materials produced by Conscious Planet.  The rationale behind this requirement is simple.  Conscious Planet has carefully designed its products, product labels, Marketing and Compensation Plan, and promotional materials to ensure that each aspect of Conscious Planet is fair, truthful, substantiated, and complies with the vast and complex legal requirements of federal and state provincial laws.  If Conscious Planet Members were allowed to develop their own sales aids and promotional materials (which includes Internet advertising), notwithstanding their integrity and good intentions, the likelihood that they would unintentionally violate any number of statutes or regulations affecting a Conscious Planet business is almost certain.  These violations, although they may be relatively few in number, would jeopardize the Conscious Planet opportunity for all Members.  Accordingly, Members must not produce their own literature, advertisements, sales aids and promotional materials, or Internet web pages.

3.2.2 - Member Websites

If a Member desires to utilize an Internet web page to promote his or her business, he or she may do so through the Company’s replicated website program in conjunction with their own personal website.  This program permits Members to advertise on the Internet.  These websites seamlessly link directly to the official Conscious Planet website giving the Distributor a professional and Company-approved presence on the Internet. No Member may independently design a website that uses the names, logos, or product descriptions of Conscious Planet or otherwise promotes (directly or indirectly) Conscious Planet products or the Conscious Planet opportunity without permission.  Nor may a Member use "blind" ads on the Internet that make product or income claims which are ultimately associated with Conscious Planet products, the Conscious Planet opportunity, or the Conscious Planet Marketing and Compensation Plan.  The use of any other Internet website or web page (including without limitation auction sites such as eBay) to in any way promote the sale of Conscious Planet products, the Conscious Planet opportunity, or the Marketing and Compensation Plan is a breach of the Agreement and may result in any of the disciplinary sanctions set forth in Section 8.1.

Alternatively, Members may develop their own web pages, however, any Member who does so: (a) must use the text of the Company’s official website; (b) may not supplement the content of his or her website with text from any source other than the Company; or (c) may not have or incorporate a shopping cart feature into the site—the site must link to the Member’s replicated Conscious Planet website for sales purposes.  Members who develop or publish their own websites must register their site(s) with the Company and receive written approval from the Company prior to the site(s) public availability.  The failure to register constitutes a material breach of these policies and procedures.

3.2.3 - Domain Names and Email Addresses

Members may not use or attempt to register any of Conscious Planet’s trade names, trademarks, service names, service marks, product names, the Company’s name, or any derivative thereof, for any Internet domain name.  Nor may Members incorporate or attempt to incorporate any of the Company’s trade names, trademarks, service names, service marks, product names, the Company’s name, or any derivative thereof, into any electronic mail address.

3.2.4 - Trademarks and Copyrights

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

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

•  Member's Name
• Independent Conscious Planet Member

All Members may list themselves as an “Independent Conscious Planet Member” in the white or yellow pages of the telephone directory under their own name.  No Member may place telephone directory display ads using Conscious Planet's name or logo.  Members may not answer the telephone by saying “Conscious Planet”, “Conscious Planet Enterprise Solution”, or in any other manner that would lead the caller to believe that he or she has reached corporate offices of Conscious Planet.

3.2.5 - Media and Media Inquiries

Members must not attempt to respond to media inquiries regarding Conscious Planet, its products, or their independent Conscious Planet business.  All inquiries by any type of media must be immediately referred to Conscious Planet’s Marketing Department.  This policy is designed to assure that accurate and consistent information is provided to the public as well as a proper public image.

3.2.6 - Spamming and Unsolicited Faxes

Except as provided in this section, Members may not use or transmit unsolicited faxes, mass e-mail distribution, unsolicited e-mail, or “spamming” relative to the operation of their Conscious Planet businesses.  The terms "unsolicited faxes" and “unsolicited e-mail” mean the transmission via telephone facsimile or electronic mail, respectively, of any material or information advertising or promoting Conscious Planet, its products, its compensation plan or any other aspect of the company which is transmitted to any person, except that these terms do not include a fax or e-mail: (a) to any person with that person's prior express invitation or permission; or (b) to any person with whom the Member has an established business or personal relationship.  The term "established business or personal relationship" means a prior or existing relationship formed by a voluntary two way communication between a Member and a person, on the basis of: (a) an inquiry, application, purchase or transaction by the person regarding products offered by such Member; or (b) a personal or familial relationship, which relationship has not been previously terminated by either party.

3.3  - Bonus Buying Prohibited

"Bonus buying" is strictly and absolutely prohibited. Bonus buying includes: (a) the enrollment of individuals or entities without the knowledge of and/or execution of an Independent Member Application and Agreement by such individuals or entities; (b) the fraudulent enrollment of an individual or entity as a Member or Preferred Customer; (c) the enrollment or attempted enrollment of non-existent individuals or entities as Members or Preferred Customers (“phantoms”); or (d) Purchasing Conscious Planet merchandise on behalf of another Member or Preferred Customer, or under another Member’s or Preferred Customer’s I.D. number, to qualify for commissions or bonuses.

3.4  - Business Entities

A corporation, partnership or trust (collectively referred to in this section as a  “Business Entity”) may apply to be a Conscious Planet Member by submitting its Certificate of Incorporation, Partnership Agreement or trust documents (these documents are collectively referred to as the “Entity Documents”) to Conscious Planet, along with a properly completed Business Entity Registration Form.  If a Member enrolls online, the Entity Documents and Business Entity Registration Form must be submitted to Conscious Planet within 30 days of the online enrollment. (If not received within the 30-day period, the Member Agreement shall qualify to be automatically terminated.)  A Conscious Planet business may change its status under the same sponsor from an individual to a partnership, corporation or trust, or from one type of entity to another.  There is a $25.00 fee for each change requested, which must be included with the written request and the completed Member Application and Agreement.  The Business Entity Registration Form must be signed by all of the shareholders, partners or trustees. Members of the entity are  jointly and severally liable for any indebtedness or other obligation to Conscious Planet.

3.5  - Changes to a Conscious Planet Business

3.5.1 - General

Each Member must immediately notify Conscious Planet of all changes to the information contained on his or her Member Application and Agreement.  Members may modify their existing Member Agreement (i.e., change Social Security number to Federal I.D. number, or change the form of ownership from an individual proprietorship to a business entity owned by the Member) by submitting a written request, a properly executed Member Application and Agreement, and appropriate supporting documentation.  Changes shall be processed only once per year.  All changes must be submitted by November 30 to become effective on January 1 of the following year.

3.5.2 - Addition of Co-Applicants

When adding a co-applicant (either an individual or a business entity) to an existing Conscious Planet business, the Company requires both a written request as well as a properly completed Member Application and Agreement containing the applicant and co-applicant’s Social Security Numbers and signatures.  To prevent the circumvention of Section 3.26 (regarding transfers and assignments of Conscious Planet business), the original applicant must remain as a party to the original Member Application and Agreement.  If the original Member wants to terminate his or her relationship with the Company, he or she must transfer or assign his or her business in accordance with Section 3.26.   If this process is not followed, the business shall be canceled upon the withdrawal of the original Member.  All bonus and commission cheques will be sent to the address of record of the original Member.  Please note that the modifications permitted within the scope of this paragraph do not include a change of sponsorship.  Changes of sponsorship are addressed in Section 3.5.3, below.  There is a $25.00 fee for each change requested, which must be included with the written request and the completed Member Application and Agreement.  Conscious Planet may, at its discretion, require notarized documents before implementing any changes to a Conscious Planet business.  Please allow thirty (30) days after the receipt of the request by Conscious Planet for processing.

3.5.3 - Change of Sponsor/Enroller

To protect the integrity of all marketing organizations and safeguard the hard work of all Members, Conscious Planet strongly discourages changes in sponsorship.  Maintaining the integrity of sponsorship is critical for the success of every Member and marketing organization.  Accordingly, the transfer of a Conscious Planet business from one sponsor to another is rarely permitted.

Requests for change of sponsorship must be submitted in writing to the Member Services Department, and must include the reason for the transfer.  Transfers will only be considered in the following two (2) circumstances:

a) In cases involving fraudulent inducement or unethical sponsoring, a Member may request that he or she be transferred to another organization with his or her entire marketing organization intact.  All requests for transfer alleging fraudulent enrollment practices shall be evaluated on a case by case basis.

b) The Member seeking to transfer submits a properly completed and fully executed Sponsorship Transfer Form which includes the written approval of his or her immediate upline Member or all parties whose income will be affected by the transfer.  Photocopied or facsimile signatures are not acceptable.  All Member signatures must be witnessed.  The Member who requests the transfer must submit a fee of $50.00 for administrative charges and data processing.  If the transferring Member also wants to move any of the Members in his or her marketing organization, each downline Distributor must also obtain a properly completed Sponsorship Transfer Form and return it to Conscious Planet with the $50.00 change fee (i.e., the transferring Member and each Member in his or her marketing organization multiplied by $50.00 is the cost to move a Conscious Planet business.)  Downline Members will not be moved with the transferring Member unless all of the requirements of this paragraph are met.  Transferring Members must allow thirty (30) days after the receipt of the Sponsorship Transfer Forms by Conscious Planet for processing and verifying change requests.  Conscious Planet will consider waiving the six month waiting period under exceptional circumstances.  Such requests for waiver must be submitted to Conscious Planet in writing.

3.5.4 - Cancellation and Re-application

A Member may legitimately change organizations by voluntarily canceling his or her Conscious Planet business and remaining inactive (i.e., no purchases of Conscious Planet products for resale, no sales of Conscious Planet products, no sponsoring) for six (6) full calendar months.  Following the six month period of inactivity, the former Member may reapply under a new sponsor.

3.6 - Unauthorized Claims and Actions

3.6.1 - Indemnification

A Member is fully responsible for all of his or her verbal and written statements made regarding Conscious Planet products and the Marketing and Compensation Plan which are not expressly contained in official Conscious Planet materials.  Members agree to indemnify Conscious Planet and Conscious Planet’s directors, officers, employees, and agents, and hold them harmless from any and all liability including judgments, civil penalties, refunds, attorney fees, court costs, or lost business incurred by Conscious Planet as a result of the Member’s unauthorized representations or actions.  This provision shall survive the termination of the Member Agreement.

3.6.2 - Product Claims

No claims (which include personal testimonials) as to beneficial properties of any products offered by Conscious Planet may be made except those contained in official Conscious Planet literature.

3.6.3 - Income Claims

In their enthusiasm to enroll prospective Members, some Members are occasionally tempted to make income claims or earnings representations to demonstrate the inherent power of affiliate or network marketing.  This is counterproductive because new Members may become disappointed very quickly if their results are not as extensive or as rapid as the results others have achieved.  At Conscious Planet, we firmly believe that the Conscious Planet income potential is great enough to be highly attractive, without reporting the earnings of others.

Moreover, the Federal Trade Commission and several states have laws or regulations that regulate or even prohibit certain types of income claims and testimonials made by persons engaged in network marketing.  While Members may believe it beneficial to provide copies of cheques, or to disclose the earnings of themselves or others, such approaches have legal consequences that can negatively impact Conscious Planet as well as the Member making the claim unless appropriate disclosures required by law are also made contemporaneously with the income claim or earnings representation.  Because Conscious Planet Members do not have the data necessary to comply with the legal requirements for making income claims, a Member, when presenting or discussing the Conscious Planet opportunity or Marketing and Compensation Plan to a prospective Member, may not make income projections, income claims, or disclose his or her Conscious Planet income (including the showing of checks, copies of checks, bank statements, or tax records).  Hypothetical income examples that are used to explain the operation of the Marketing and Compensation Plan, and which are based solely on mathematical projections, may be made to prospective Members, so long as the Member who uses such hypothetical examples makes clear to the prospective Member(s) that such earnings are hypothetical and the Member provides the prospect with a copy of the most current income disclosure chart prepared by the Company.  Until such time as Conscious Planet publishes an official income disclosure statement, Members may not use hypothetical income examples in the promotion of their Conscious Planet businesses.

3.7 - Commercial Outlets and Sales

3.7.1 - Commercial

Conscious Planet strongly encourages the retailing and selling of its products through person to person contact.  In an effort to reinforce this method of marketing and to help provide a standard of fairness for its Member base, Members may not display or sell Conscious Planet products or literature in any retail or service establishment other than in a private capacity and responsibility.

3.7.2 - Commercial Sales

Conscious Planet will permit Members to solicit and make commercial sales upon prior written approval from the Company.  For the purposes of these Policies and Procedures, the term “commercial sale” means the sale of:

a) Conscious Planet products that equal or exceed $2,500.00 in a single order, and

b) To a third party who intends to resell the products to an end consumer.

3.7.3 - Trade Shows, Expositions and Other Sales Forums

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

3.8  - Conflicts of Interest

3.8.1 - Nonsolicitation

Conscious Planet Members may participate in other direct selling or network marketing or multilevel  marketing ventures (collectively “network marketing”), and Members may engage in selling activities related to non- Conscious Planet products and services if they desire to do so.  However, if a Member elects to participate in another network marketing opportunity, in order to avoid conflicts of interest and loyalties, Members are prohibited from Unauthorized Recruiting, which includes the following:

a) During the term of this agreement, any actual or attempted recruitment or enrollment of other Members or Preferred Customers for other network marketing business ventures, either directly or through a third party.  This includes, but is not limited to, presenting or assisting in the presentation of other network marketing business ventures to any Conscious Planet Preferred Customer or Member, or implicitly or explicitly encouraging any Conscious Planet Preferred Customer or Member to join other business ventures.  Because there is an extreme likelihood that conflicts will arise if a Member operates two network marketing programs, it is the Member’s responsibility to first determine whether a prospect is a Conscious Planet Preferred Customer or Member before recruiting or enrolling the prospect for another network business venture.

b) Following the cancellation of this Agreement, and for a period of six months thereafter, a former Member may not recruit any non-personally sponsored Conscious Planet Member or Preferred Customer for another network marketing business.  A former Member may recruit his or her personally-sponsored Members and Preferred Customers for another network marketing business.

c) Producing or offering any literature, tapes or promotional material of any nature for another network marketing business which is used by the Member or any third person to recruit Conscious Planet Preferred Customers or Members for that business venture;

d) Selling, offering to sell, or promoting any competing non- Conscious Planet products to Conscious Planet Preferred Customers or Members.  Any product in the same generic category as a Conscious Planet product is deemed to be competing, regardless of differences in cost, quality, ingredients or nutrient content.

e) Offering Conscious Planet products, or promoting the Conscious Planet Marketing and Compensation Plan, in conjunction with any non- Conscious Planet products, services, business plan, opportunity, or incentive; or

f) Offering any non- Conscious Planet products, services, business plan, opportunity, or incentive at any Conscious Planet meeting, seminar, launch, convention, or other Conscious Planet function, or immediately following such event.

3.8.2 - Downline Activity (Genealogy) Reports

Downline Activity Reports are available for Member access and viewing at Conscious Planet’s official website.  Distributor access to their Downline Activity Reports is password protected.  All Downline Activity Reports and the information contained therein are confidential and constitute proprietary information and business trade secrets belonging to Conscious Planet.  Downline Activity Reports are provided to Members in strictest confidence and are made available to Members for the sole purpose of assisting Members in working with their respective Downline Organizations in the development of their Conscious Planet business.  Members should use their Downline Activity Reports to assist, motivate, and train their downline Members. The Member and Conscious Planet agree that, but for this agreement of confidentiality and nondisclosure, Conscious Planet would not provide Downline Activity Reports to the Member.  A Member shall not, on his or her own behalf, or on behalf of any other person, partnership, association, corporation or other entity:

a) Directly or indirectly disclose any information contained in any Downline Activity Report to any individual, partnership, association, corporation, or other entity;

b) Directly or indirectly disclose, to any individual, partnership, association, corporation, or other entity, the password or other access code to his or her Downline Activity Report;

c) Use the information contained in any Downline Activity Report to compete with Conscious Planet or for any purpose other than promoting or supporting his or her Conscious Planet business; or

d) Recruit or solicit any Member or Preferred Customer listed on any Downline Activity Report, or in any manner attempt to influence or induce any Member or Preferred Customer, to alter their business relationship with Conscious Planet.

Upon demand by the Company, any current or former Member will return the original and all copies of Downline Activity Reports to the Company.

3.9  - Targeting Other Direct Sellers

Conscious Planet does not condone Members specifically or consciously targeting the sales force of another direct sales company to sell Conscious Planet products or to become Members for Conscious Planet, nor does Conscious Planet condone Members solicitation or enticement of members of the sales force of another direct sales company to violate the terms of their contract with such other company.  Should Members engage in such activity, they bear the risk of being sued by the other direct sales company.  If any lawsuit, arbitration or mediation is brought against a Member alleging that he or she engaged in inappropriate recruiting activity of its sales force or customers, Conscious Planet will not pay any of Member’s defense costs or legal fees, nor will Conscious Planet indemnify the Member for any judgment, award, or settlement.

3.10 - Cross-Sponsoring

Actual or attempted cross sponsoring is strictly prohibited.  “Cross sponsoring” is defined as the enrollment of an individual who has, or entity that already has a current Customer or Member Agreement on file with Conscious Planet, or who has had such an agreement within the preceding six calendar months, within a different line of sponsorship.  The use of a spouse’s or relative’s name, trade names, DBAs, assumed names, corporations, partnerships, trusts, federal ID numbers, or fictitious ID numbers to circumvent this policy is prohibited.  Members shall not demean, discredit or defame other Conscious Planet Members in an attempt to entice another Member to become part of the first Member’s marketing organization.  This policy shall not prohibit the transfer of a Conscious Planet business in accordance with Section 3.26.

If Cross Sponsoring is discovered, we request it is brought to the Company’s attention immediately.  Conscious Planet may take disciplinary action against the Member that changed organizations and/or those Members who encouraged or participated in the Cross Sponsoring.  Conscious Planet may also move all or part of the offending Member’s downline, including those enrolled after a Member changed organizations in violation of this policy, to his or her original downline organization if the Company deems it equitable and feasible to do so.  However, Conscious Planet is under no obligation to move the Cross Sponsored Member’s downline organization, and the ultimate disposition of the organization remains within the sole discretion of Conscious Planet.  Members waive all claims and causes of action against Conscious Planet arising from or relating to the disposition of the Cross Sponsored Member’s downline organization.

3.11 - Errors or Questions

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

3.12 - Excess Inventory Purchases Prohibited

Members are not required to carry inventory of products or sales aids.  Members who do so may find making retail sales and building a marketing organization somewhat easier because of the decreased response time in fulfilling customer orders or in meeting a new Member's needs.  Each Member must make his or her own decision with regard to these matters.  To ensure that Members are not encumbered with excess inventory that they are unable to sell, such inventory may be returned to Conscious Planet upon the Member’s cancellation pursuant to the terms of Section 7.2.

Conscious Planet strictly prohibits the purchase of products in unreasonable amounts primarily for the purpose of qualifying for commissions, bonuses or advancement in the Marketing and Compensation Plan.  Distributors may not purchase more inventory than they can reasonably resell or consume in a month nor may they encourage others to do so.  Members are prohibited from purchasing more than $5,000.00 in products per month unless they certify to Conscious Planet that they have pending retail orders in excess of that amount or provide Conscious Planet with other written reason why such a purchase is necessary.

3.13 - Governmental Approval or Endorsement

Neither federal nor state regulatory agencies or officials approve or endorse any direct selling, affiliate or network marketing companies or programs.  Therefore, Members shall not represent or imply that Conscious Planet or its Marketing and Compensation Plan have been "approved," "endorsed" or otherwise sanctioned by any government agency.

3.14 - Holding Applications or Orders

Members must not manipulate enrollments of new applicants and purchases of products.  All Member Applications and Agreements, and product orders must be sent to Conscious Planet within 72 hours from the time they are signed by a Member or placed by a customer, respectively.

3.15 - Identification

All Members are required to sign a private agreement, provide their Social Security Number, Social Insurance Number, or a Federal Employer Identification Number to Conscious Planet on the Member Application and Agreement.  Upon enrollment, the Company will provide a unique Member Identification Number to the Member by which he or she will be identified.  This number will be used to place orders, and track commissions and bonuses.

3.16 - Income Taxes

Each Member who operates in the capacity as an employee of the state under the jurisdiction of Maritime Law is responsible for paying local, state/provincial, and federal taxes on any income generated as an Independent Member.  If a Conscious Planet business is tax exempt, the appropriate identification number must be provided to Conscious Planet.  Every year, Conscious Planet will provide an appropriate tax form for whatever country they do business in for those who request it and has: 1) had earnings of over $600 in the previous calendar year, or 2) made purchases during the previous calendar year in excess of $5,000.

3.17 - Independent Contractor Status

Members are independent contractors, and are not purchasers of a franchise or a business opportunity.  The agreement between Conscious Planet and its Members does not create an employer/employee relationship, partnership, or joint venture between the Company and the Member. Members shall not be treated as an employee for his or her services or for Federal or State tax purposes.  All Members are responsible for paying local, state, and federal taxes due from all compensation earned as a Member of the Company.  The Member has no authority (expressed or implied), to bind the Company to any obligation.  Each Member shall establish his or her own goals, hours, and methods of sale, so long as he or she complies with the terms of the Member Agreement, these Policies and Procedures, and applicable laws.

3.18 - Insurance

3.18.1 - Business Pursuits Coverage

You may wish to arrange insurance coverage for your business.  Your homeowner’s insurance policy does not cover business-related injuries, or the theft of or damage to inventory or business equipment.  Contact your insurance agent to make certain that your business property is protected.  This can often be accomplished with a simple “Business Pursuit” endorsement attached to your present home owner’s policy.

3.18.2 - Product Liability Coverage

Conscious Planet’s suppliers maintain insurance to protect the Company and Members against product liability claims.  The supplier’s insurance policy contains a “Vendors Endorsement” which extends coverage to Independent Members so long as they are marketing Conscious Planet products in accordance with Company Policies and applicable laws and regulations.  Conscious Planet’s product liability policy does not extend coverage to claims or actions that arise as a result of a Member’s misconduct in marketing the products.

3.19 - International Marketing

Because of critical legal and tax considerations, Conscious Planet must limit the resale of Conscious Planet products, and the presentation of the Conscious Planet business to prospective customers and Members located within Canada, the United States and U.S. Territories.  Moreover, allowing a few Members to conduct business in markets not yet opened by Conscious Planet would violate the concept of affording every Member the equal opportunity to expand internationally.

Accordingly, Members are authorized to sell Conscious Planet products, and enroll Preferred Customers and Members only in the countries in which Conscious Planet is authorized to conduct business, as announced in official Company literature.  Members may sell, give, transfer, or distribute Conscious Planet products or sales aids only in the countries Conscious Planet makes available.  In addition, no Member may, in any unauthorized country: (a) conduct sales, enrollment or training meetings; (b) enroll or attempt to enroll potential customers or Members; or (c) conduct any other activity for the purpose of selling Conscious Planet products, establishing a marketing organization, or promoting the Conscious Planet opportunity.

3.20 - Adherence to Laws and Ordinances

3.20.1 - Local Ordinances

Many cities and counties have laws regulating certain home-based businesses.  In most cases these ordinances are not applicable to Members because of the nature of their business.  However, Members must obey those laws that do apply to them.  If a city or county official tells a Member that an ordinance applies to him or her, the Member shall be polite and cooperative, and immediately send a copy of the ordinance to the Member Services Department of Conscious Planet.  In most cases there are exceptions to the ordinance that may apply to Conscious Planet Members.

3.20.2 - Compliance With Federal, State, Local Laws

Members shall comply with all federal, state, and local laws and regulations in the conduct of their businesses.

3.21 - Minors

A person who is recognized as a minor in his/her state of residence may not be a Conscious Planet Member.  Members shall not enroll or recruit minors into the Conscious Planet program.

3.22 - One Conscious Planet Business Per Distributor

A Member may operate or have an ownership interest, legal or equitable, as a sole proprietorship, partner, shareholder, trustee, or beneficiary, in only one Conscious Planet business.  No individual may have, operate or receive compensation from more than one Conscious Planet business.

In order to maintain the integrity of the Conscious Planet Marketing and Compensation Plan, we highly recommend husbands and wives or common-law couples (collectively “spouses”) who wish to become Conscious Planet Members be jointly sponsored as one Conscious Planet business.  Spouses, may own or operate another Conscious Planet business, however we encourage a discussion with each situation as it may not be financially or otherwise beneficial to do so.

An exception to the one business per Member rule will be considered on a case by case basis if two Members marry or in cases of a Member receiving an interest in another business through inheritance.  Requests for exceptions to policy must be submitted in writing to the Member Services Department.

3.22.1 - Actions of Household Members or Affiliated Individuals

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

3.23 - Re-packaging and Re-labeling Prohibited

Members may not re-package, re-label, refill or alter the labels on any Conscious Planet products, information, materials or programs in any way.  Conscious Planet products must be sold in their original containers only.  Such re-labeling or repackaging would likely violate federal and state laws, which could result in severe criminal penalties.  You should also be aware that civil liability can arise when, as a consequence of the repackaging or re-labeling of products, the persons using the products suffer any type of injury or their property is damaged.

3.24 - Requests for Records

Any request from a Member for copies of invoices, applications, downline activity reports, or other records will require a fee of $1.00 per page per copy.  This fee covers the expense of mailing and time required to research files and make copies of the records.

3.25 - Roll-up of Marketing Organization

When a vacancy occurs in a Marketing Organization due to the termination of a Conscious Planet business, each Member in the first level immediately below the terminated Member on the date of the cancellation will be moved to the first level (“front line”) of the terminated Member's sponsor.  For example, if A sponsors B, and B sponsors C1, C2, and C3, if B terminates her business, C1, C2, and C3 will “roll-up” to A and become part of A’s first level.

3.26 - Sale, Transfer or Assignment of Conscious Planet Business

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

a) Protection of the existing line of sponsorship must always be maintained so that the Conscious Planet business continues to be operated in that line of sponsorship.

b) The buyer or transferee must be (or must become) a qualified Conscious Planet Member.  If the buyer is an active Conscious Planet Member, he or she must first terminate his or her Conscious Planet business simultaneously with the purchase, transfer, assignment or acquisition of any interest in the new Conscious Planet business.

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

d) The selling Member must be in good standing and not in violation of any of the terms of the Agreement in order to be eligible to sell, transfer or assign a Conscious Planet business.

Prior to selling a Conscious Planet business, the selling Member must notify Conscious Planet’s Member services Department of his or her intent to sell the Conscious Planet business.  Upon complete execution of the purchase and sale agreement, the parties must submit copies of the same to Conscious Planet’s Compliance Department for review.  Conscious Planet reserves the right to request additional documentation that may be necessary to analyze the transaction between the buyer and seller.  Conscious Planet’s Compliance Department will, in its sole and absolute discretion, approve or deny the sale, transfer or assignment within 30 days after its receipt of all necessary documents from the parties.

If the parties fail to obtain Conscious Planet’s approval for the transaction, the transfer shall be voidable at Conscious Planet’s option.  The purchaser of the existing Conscious Planet business will assume the obligations and position of the selling Member.  A Member who sells his or her Conscious Planet business shall not be eligible to re-apply as a Conscious Planet Member for a period of at least six full calendar months after the date of the sale.  No changes in line of sponsorship can result from the sale or transfer of a Conscious Planet business.

3.27 - Separation of a Conscious Planet Business

Conscious Planet Members sometimes operate their Conscious Planet businesses as husband-wife partnerships, regular partnerships, corporations, or trusts.  At such time as a marriage may end in divorce or a corporation, partnership or trust (the latter three entities are collectively referred to herein as “entities”) may dissolve, arrangements must be made to assure that any separation or division of the business is accomplished so as not to adversely affect the interests and income of other businesses up or down the line of sponsorship.  If the separating parties fail to provide for the best interests of other Members and the Company, Conscious Planet will involuntarily terminate the Member Agreement and roll-up their entire organization pursuant to Section 3.25.

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

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

b) The parties may continue to operate the Conscious Planet business jointly on a “business-as-usual” basis, whereupon all compensation paid by Conscious Planet will be paid in the joint names of the Members or in the name of the entity to be divided as the parties may independently agree between themselves.

c) If the parties cannot mutually agree on how the business shall be allocated during the pendency of a divorce or dissolution, the Company shall treat the business according to the status quo as existed prior to the filing of the divorce or dissolution.

Under no circumstances will the Downline Organization of divorcing spouses or a dissolving business entity be divided.  Similarly, under no circumstances will Conscious Planet split commission and bonus checks between divorcing spouses or members of dissolving entities.  Conscious Planet will recognize only one Downline Organization and will issue only one commission check per F Conscious Planet business per commission cycle.  Commission checks shall always be issued to the same individual or entity.  In the event that parties to a divorce or dissolution proceeding are unable to resolve a dispute over the disposition of commissions and ownership of the business, the Member Agreement shall be involuntarily canceled.

If a former spouse or a former entity affiliate has completely relinquished all rights in their original Conscious Planet business, they are thereafter free to enroll under any sponsor of their choosing, so long as they meet the waiting period requirements set forth in Section 3.5.4.  In such case, however, the former spouse or partner shall have no rights to any Members in their former organization or to any former Retail Customer or Preferred Customer.  They must develop the new business in the same manner as would any other new Member.

3.28 - Sponsoring

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

3.29 - Stacking

“Stacking” is strictly prohibited.  The term “stacking” includes: (a) the failure to transmit to Conscious Planet or the holding of an Independent Member Application and Agreement in excess of two business days after its execution; (b) the placement or manipulation of Independent Member Applications and Agreements for the purpose of maximizing compensation pursuant to Conscious Planet’s Marketing and Compensation Plan; (c) providing financial assistance to new Members for the purpose of maximizing compensation pursuant to Conscious Planet’s Marketing and Compensation Plan;  (d) violating the one business per household rule; and/or (e) enrolling fictitious individuals or entities into the Conscious Planet compensation plan.

3.30 - Succession

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

a) Execute a Member Agreement;

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

c) Meet all of the qualifications for the deceased Member’s status.

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

3.30.1- Transfer Upon Death of a Member

To effect a testamentary transfer of a Conscious Planet business, the successor must provide the following to Conscious Planet: (1) an original death certificate, (2) a notarized copy of the will or other instrument establishing the successor’s right to the Conscious Planet business, and (3) a completed and executed Distributor Agreement.

3.30.2 - Transfer Upon Incapacitation of a Distributor

To effect a transfer of a Conscious Planet business because of incapacity, the successor must provide the following to Conscious Planet: (1) a notarized copy of an appointment as trustee; (2) a notarized copy of the trust document or other documentation establishing the trustee’s right to administer the Conscious Planet business; (3) a completed  Distributor Agreement executed by the trustee.

3.30.1 - Telemarketing

The Federal Trade Commission and the Federal Communications Commission each have laws that restrict telemarketing practices.  Both federal agencies (as well as a number of states) have “do not call” regulations as part of their telemarketing laws.  While you may not consider yourself a “telemarketer” in the traditional sense of the word, these regulations broadly define the term “telemarketer” and “telemarketing” so that your inadvertent action of calling someone whose telephone number is listed on the federal “do not call” registry could cause you to violate the law.  Moreover, these regulations must not be taken lightly, as they carry significant penalties (up to $11,000.00 per violation).

Therefore, Members must not engage in telemarketing relative to the operation of their Conscious Planet businesses.  The term “telemarketing” means the placing of one or more telephone calls to an individual or entity to induce the purchase of a Conscious Planet product, or to recruit them for the Conscious Planet opportunity.  “Cold calls" made to prospective customers or Members that promote either Conscious Planet's products or the Conscious Planet opportunity constitute telemarketing and are prohibited.  However, a telephone call(s) placed to a prospective customer or Member (a "prospect") is permissible under the following situations:

• If the Member has an established business relationship with the prospect.  An “established business relationship” is a relationship between a Member and a prospect based on the prospect’s purchase, rental, or lease of goods or services from the Member, or a financial transaction between the prospect and the Member, within the eighteen (18) months immediately preceding the date of a telephone call to induce the prospect's purchase of a product or service.
• The prospect’s personal inquiry or application regarding a product or service offered by the Member, within the three (3) months immediately preceding the date of such a call.
• If the Member receives written and signed permission from the prospect authorizing the Member to call.  The authorization must specify the telephone number(s) which the Member is authorized to call.
• You may call family members, personal friends, and acquaintances.  An “acquaintance” is someone with whom you have at least a recent first-hand relationship (i.e., you have recently personally met him or her).  Bear in mind, however, that if you make a habit of “card collecting” with everyone you meet and subsequently calling them, the FTC may consider this a form of telemarketing that is not subject to this exemption.   Thus, if you engage in calling “acquaintances,” you must make such calls on an occasional basis only and not make this a routine practice.

In addition, Members shall not use automatic telephone dialing systems relative to the operation of their Conscious Planet businesses. The term “automatic telephone dialing system” means equipment which has the capacity to: (a) store or produce telephone numbers to be called, using a random or sequential number generator, and (b) to dial such numbers.

3.32 - Use of the Conscious Planet E-Mail System

Conscious Planet maintains an e-mail system for use by Members.  This system is a tool to communicate with your downline and to promote the sale of Conscious Planet products and the Conscious Planet opportunity.  Under no circumstances shall a Distributor use the Conscious Planet e-mail system to promote the sale of any non- Conscious Planet products or services or any non- Conscious Planet program or opportunity.

SECTION 4 - RESPONSIBILITIES OF MEMBERS

4.1 - Change of Address or Telephone

To ensure timely delivery of products, support materials, and commission checks, it is critically important that the Conscious Planet’s files are current.  Street addresses are required for shipping since UPS cannot deliver to a post office box.  Members planning to move should send their new address and telephone numbers to Conscious Planet’s Corporate Offices to the attention of the Member Services Department.  To guarantee proper delivery, two weeks advance notice must be provided to Conscious Planet on all changes.  Special Note:  If you are presently on the Auto-Ship program, you must submit a new Auto-Ship Agreement.  If more than one change of address notice or Auto-Ship Agreement has been submitted to Conscious Planet, the most recent one will supersede previous notices or Agreements.  Please allow thirty (30) days after the receipt of the notice or Agreement by Conscious Planet for processing.

4.2 - Continuing Development Obligations

4.2.1 - Ongoing Training

Any Member who sponsors another Member into Conscious Planet must perform a bona fide assistance and training function to ensure that his or her downline is properly operating his or her Conscious Planet business.  Members must have ongoing contact and communication with the Members in their Downline Organizations.  Examples of such contact and communication may include, but are not limited to:  newsletters, written correspondence, personal meetings, telephone contact, voice mail, electronic mail, and the accompaniment of downline Members to Conscious Planet meetings, training sessions, and other functions.  Upline Members are also responsible to motivate and train new Members in Conscious Planet product knowledge, effective sales techniques, the Conscious Planet Marketing and Compensation Plan, and compliance with Company Policies and Procedures.  Communication with and the training of downline Members must not, however, violate Section 3.2 (regarding the development of Member-produced sales aids and promotional materials).

Members must monitor the Members in their Downline Organizations to ensure that downline Members do not make improper product or business claims, or engage in any illegal or inappropriate conduct.  Upon request, every Member should be able to provide documented evidence to Conscious Planet of his or her ongoing fulfillment of the responsibilities of a Sponsor/Enroller.

4.2.2 - Increased Training Responsibilities

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

4.2.3 - Ongoing Sales Responsibilities

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

4.3 - Nondisparagement

Conscious Planet wants to provide its independent Members with the best products, compensation plan, and service in the industry.  Accordingly, we value your constructive criticisms and comments.  All such comments should be submitted in writing to the Member Services Department.  Remember, to best serve you, we must hear from you!  While Conscious Planet welcomes constructive input, negative comments and remarks made in the field by Members about the Company, its products, or compensation plan serve no purpose other than to sour the enthusiasm of other Conscious Planet Members.  For this reason, and to set the proper example for their downline, Members must not disparage, demean, or make negative remarks about Conscious Planet, other Conscious Planet Members, Conscious Planet’s products, the Marketing and Compensation plan, or Conscious Planet’s directors, officers, or employees.

4.4 - Providing Documentation to Applicants

Members must provide the most current version of the Policies and Procedures and the Compensation Plan to individuals whom they are sponsoring to become Members before the applicant signs a Member Agreement.  Additional copies of Policies and Procedures can be acquired from Conscious Planet and can be found on the Conscious Planet website at www.consciousplanet.net.

4.5 - Reporting Policy Violations

Members observing a Policy violation by another Member should submit a written report of the violation directly to the attention of the Conscious Planet Compliance Department.  Details of the incidents such as dates, number of occurrences, persons involved, and any supporting documentation should be included in the report.

SECTION 5 - SALES REQUIREMENTS

5.1 - Product Sales

The Conscious Planet Marketing and Compensation Plan is based upon the sale of Conscious Planet products to end consumers.  Members must fulfill personal and Downline Organization retail sales requirements (as well as meet other responsibilities set forth in the Agreement) to be eligible for bonuses, commissions and advancement to higher levels of achievement.  The following sales requirements must be satisfied for Members to be eligible for commissions:

a) Members must satisfy the Personal Bonus Volume requirements associated with their rank as specified in the Conscious Planet Marketing and Compensation Plan.

b) 3 Customer Rule.  Members at the Apprenticeship Position must develop or service at least three customers every year.  These customers can be either personal Retail Customers, Preferred Customers, or any combination of the two.

d) Members will be accountable to the 3 Customer Rule by an honor system. Members who are generating purchase volume in a wholesale business capacity agree by acceptance of this agreement that in order for their membership to qualify as a business, some product must be sold at retail.

5.2 - No Price or Territory Restrictions

Members are not required to sell Conscious Planet products at the suggested retail prices set by Conscious Planet on the Conscious Planet Price List.  Members may sell Conscious Planet products at any price they choose.  There are no exclusive territories granted to anyone.  No franchise fees are required.

5.3 - Sales Receipts

All Members must provide their Retail Customers with two copies of an official Conscious Planet sales receipt at the time of the sale.  These receipts set forth the Customer Satisfaction Guarantee for Conscious Planet products, as well as any consumer protection rights afforded by federal or state law.  Members must maintain all retail sales receipts for a period of two years and furnish them to Conscious Planet at the Company’s request.  Records documenting the purchases of Members and Preferred Online Customers will be maintained by Conscious Planet.

Members must ensure that the following information is contained on each sales receipt: and a copy of this sales receipt is available on the Conscious Planet website or from the member services department. It must include (1) The date of the transaction, (2) the date (not earlier than the third business day following the date of the transaction) by which the buyer may give notice of cancellation, and (3) the name and address of the selling Member.

Remember that Retail Customers must receive two copies of the sales receipt.  In addition, Members must orally inform the buyer of his or her cancellation rights.

SECTION 6 - BONUSES AND COMMISSIONS

6.1 - Bonus and Commission Qualifications

A Member must be active and in compliance with the Agreement to qualify for bonuses and commissions.  So long as a Member complies with the terms of the Agreement, Conscious Planet shall pay commissions to such Distributor in accordance with the Marketing and Compensation plan.   The minimum amount for which Conscious Planet will issue a check is $50.00.  If a Member’s bonuses and commissions do not equal or exceed $50.00, the Company will accrue the commissions and bonuses until they total $50.00.  A check will be issued once $50.00 has been accrued.

6.2 - Adjustment to Bonuses and Commissions

6.2.1 - Adjustments for Returned Products

Members receive bonuses and commissions based on the actual sales of products to end consumers.  When a product is returned to Conscious Planet for a refund or is repurchased by the Company, the bonuses and commissions attributable to the returned or repurchased product(s) will be deducted, in the month in which the refund is given, and continuing every pay period thereafter until the commission is recovered, from the Members who received bonuses and commissions on the sales of the refunded products.

6.2.2 - Other Deductions

Conscious Planet will deduct from all bonus and commission cheques a data processing fee of $.01 per line for downline genealogy reports sent to Distributors.  The maximum fee is $5.00. Also a cheque processing fee of $3.00 will be deducted from all commission cheques.

6.3  Unclaimed Commissions and Credits

Members must deposit or cash commission and bonus checks within six months from their date of issuance.  A check that remains uncashed after six months will be void.  After a check has been voided, Conscious Planet will attempt to notify a Member who has an uncashed check by sending a monthly written notice to his or her last known address identifying the amount of the check and advising that the Member can request that the check be reissued.  There shall be a $15.00 charge for reissuing a check, and a $10.00 fee for each notice that is sent to the Member.  These charges shall be deducted from the balance owed to the Member.

Preferred Customers, or Members who have a credit on account must use their credit within six months from the date on which the credit was issued.  If credits have not been used within six months, Conscious Planet shall attempt to notify the Member or Preferred or Online Customer on a monthly basis, by sending written notice to the last known address, advising the Member or Preferred or Online Customer of the credit.  There shall be a $10.00 charge for each attempted notification.  This charge shall be deducted from the Member’s or Preferred or Online Customer’s credit on account.

6.4  Reports

All information provided by Conscious Planet in online or telephonic downline activity reports, including but not limited to Personal Bonus Volume (or any part thereof), and downline sponsoring activity is believed to be accurate and reliable.  Nevertheless, due to various factors including the inherent possibility of human and mechanical error; the accuracy, completeness, and timeliness of orders, denial of credit card and electronic check payments, returned products, credit card and electronic check charge-backs, the information is not guaranteed by Conscious Planet or any persons creating or transmitting the information.

ALL PERSONAL BONUS VOLUME INFORMATION IS PROVIDED "AS IS" WITHOUT WARRANTIES, EXPRESS OR IMPLIED, OR REPRESENTATIONS OF ANY KIND WHATSOEVER.  IN PARTICULAR BUT WITHOUT LIMITATION THERE SHALL BE NO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR USE, OR NON‑INFRINGEMENT.

TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, CONSCIOUS PLANET AND/OR OTHER PERSONS CREATING OR TRANSMITTING THE INFORMATION WILL IN NO EVENT BE LIABLE TO ANY DISTRIBUTOR OR ANYONE ELSE FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT ARISE OUT OF THE USE OF OR ACCESS TO PERSONAL BONUS VOLUME INFORMATION (INCLUDING BUT NOT LIMITED TO LOST PROFITS, BONUSES, OR COMMISSIONS, LOSS OF OPPORTUNITY, AND DAMAGES THAT MAY RESULT FROM INACCURACY, INCOMPLETENESS, INCONVENIENCE, DELAY, OR LOSS OF THE USE OF THE INFORMATION), EVEN IF CONSCIOUS PLANET OR OTHER PERSONS CREATING OR TRANSMITTING THE INFORMATION SHALL HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.  TO THE FULLEST EXTENT PERMITTED BY LAW, CONSCIOUS PLANET OR OTHER PERSONS CREATING OR TRANSMITTING THE INFORMATION SHALL HAVE NO RESPONSIBILITY OR LIABILITY TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY OR OTHER THEORY WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT OR TERMS AND CONDITIONS RELATED THERETO.

Access to and use of Conscious Planet online and telephone reporting services and your reliance upon such information is at your own risk.  All such information is provided to you "as is".  If you are dissatisfied with the accuracy or quality of the information, your sole and exclusive remedy is to discontinue use of and access to Conscious Planet online and telephone reporting services and your reliance upon the information.

SECTION 7 - PRODUCT GUARANTEES, RETURNS AND INVENTORY REPURCHASE

7.1 - Product Guarantee

Conscious Planet offers a 100% 30-day money-back satisfaction guarantee (less shipping charges) to all Preferred Customers, Online Customers, Retail Customers, and Members on their first purchase of a particular Conscious Planet product.  Subsequent purchases may not be returned under this guarantee.

7.1.1 - Returns by Retail Customers

Conscious Planet offers, through its Members, a 100% 30-day money-back guarantee to all Retail Customers--on the first purchase of a Conscious Planet product only.  Every Member is bound to honor the Retail Customer guarantee.  If, for any reason, a Retail Customer is dissatisfied with any Conscious Planet product, the Retail Customer may return the unused portion of the product to the Member from whom it was purchased, within 30 days, for a replacement, exchange or a full refund of the purchase price (less shipping costs).

7.1.2 - Returns by Online and Preferred Customers

Conscious Planet offers Online and Preferred Customers an unconditional 30-day money-back guarantee.  If, for any reason, an Online Customer or Preferred Customer is dissatisfied with any Conscious Planet product, he or she may return his or her initial purchase of that product to the Company within 30-days, for a replacement, exchange or a full refund of the purchase price (less shipping).

7.1.3 - Returns by Members (Products Purchased for Personal Consumption)

If a Member is unsatisfied with any Conscious Planet product purchased for personal use, the Company offers a 100% 30-day money-back guarantee (less shipping) on his or her first purchase of a Conscious Planet product.  This guarantee is limited to the Member’s initial purchase of a Conscious Planet product only.  If a Member wishes to return subsequent purchases, the return will be deemed an inventory repurchase and the Company shall repurchase the inventory pursuant to the terms of Section 7.2, and the Member’s Agreement shall be canceled. A Member may return any products that are unusable damaged by shipping, defective from manufacturing or spoiled.

7.1.4 - Returns by Members (Products Returned by Personal Retail Customers)

If a personal Retail Customer returns his or her initial purchase of a product to the Member from whom it was purchased, the Member may return it to the Company for an exchange or refund (less shipping).  All products returned by personal Retail Customers must be returned to the Company within 10 days from the date on which it was returned to the Member along with the sales receipt which the Member gave to the Retail Customer.

7.2 - Return of Inventory and Sales Aids by Members

Upon cancellation of a Member’s Agreement, the Member may return inventory and sales aids for a refund if he or she is unable to sell or use the merchandise.  A Member may only return products and sales aids purchased by him or her that are in resalable condition or any products that are unusable damaged by shipping, defective from manufacturing or spoiled. Upon receipt of the products and sales aids, the Member will be reimbursed 90% of the net cost of the original purchase price(s), less shipping charges.  If the purchases were made through a credit card, the refund will be credited back to the same account.  The Company shall deduct from the reimbursement paid to the Member any commissions, bonuses, rebates or other incentives received by the Member which were associated with the merchandise that is returned.

7.2.1 - Montana Residents

A Montana resident may cancel his or her Member Agreement within 15 days from the date of enrollment, and may return his or her membership for a full refund within such time period.

7.3 - Procedures for All Returns

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

a) All merchandise must be returned by the Member or customer who purchased it directly from Conscious Planet.

b) All products to be returned must have a Return Authorization Number which is obtained by calling the Member Services Department.  This Return Authorization Number must be written on each carton returned.

c) The return is accompanied by:

i. a completed and signed Consumer Return Form

ii. a copy of the original dated retail sales receipt, and

iii. the unused portion of the product in its original container.

d) Proper shipping carton(s) and packing materials are to be used in packaging the product(s) being returned for replacement, and the best and most economical means of shipping is suggested.  All returns must be shipped to Conscious Planet shipping pre-paid.  Conscious Planet does not accept shipping-collect packages.  The risk of loss in shipping for returned product shall be on the Member.  If returned product is not received by the Company’s Distribution Center, it is the responsibility of the Member to trace the shipment.

e) If a Member is returning merchandise to Conscious Planet that was returned to him or her by a personal Retail Customer, the product must be received by Conscious Planet within ten (10) days from the date on which the Retail Customer returned the merchandise to the Member, and must be accompanied by the sales receipt the Member gave to the Retail Customer at the time of the sale.

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

SECTION 8 - DISPUTE RESOLUTION AND DISCIPLINARY PROCEEDINGS

8.1  - Disciplinary Sanctions

Violation of the Agreement, these Policies and Procedures, or any illegal, fraudulent, deceptive or unethical business conduct by a Member may result, at Conscious Planet's discretion, in one or more of the following corrective measures:

a) Issuance of a written warning or admonition,

b) Requiring the Member to take immediate corrective measures,

c) Imposition of a fine, which may be withheld from bonus and commission cheques,

d) Loss of rights to one or more bonus and commission cheques,

e) Conscious Planet may withhold from a Member all or part of the Member’s bonuses and commissions during the period that Conscious Planet is investigating any conduct allegedly violative of the Agreement.  If a Member’s business is canceled for disciplinary reasons, the Member will not be entitled to recover any commissions withheld during the investigation period,

f) Suspension of the individual’s Member Agreement for one or more pay periods,

g) Involuntary termination of the offender’s Member Agreement,

h) Any other measure expressly allowed within any provision of the Agreement or which Conscious Planet deems practicable to implement and appropriate to equitably resolve injuries caused partially or exclusively by the Member’s policy violation or contractual breach,

i) In situations deemed appropriate by Conscious Planet, the Company may institute legal proceedings for monetary and/or equitable relief.