Policies & Procedures

 

JUNE 28, 2021

Cara’s Naturals, LLC (“Cara’s”) is a direct sales company dedicated to providing quality products and services promoted through your home-based business. We pride ourselves on our integrity in dealing with our independent distributors and customers will continue to do so. We provide a compensation plan based on sales of our products to end-users and those of you who wish to help us promote and sell our products can be rewarded under that plan. CARA’S does not require, nor do we tolerate “inventory loading” and you will never be forced to make large purchases. All Independent Distributors or Owners (OWNER’s) as we refer to them, must agree to conduct themselves with the utmost honesty and integrity in the promotion of their independent CARA’S distributorship. This includes abiding by the terms and conditions of the Independent Distributor Agreement, the Policies and Procedures listed below and fulfilling the requirements and qualifications of the Compensation Plan as they exist now and as they may be amended from time to time.

 

TABLE OF CONTENTS

 

Section 1 – Introduction

1.1 Purpose

1.2 Conduct

1.3 Policies and Procedures Incorporated By Reference

1.4 Amendments, Revisions and Changes

1.5 Delays

1.6 Severability

1.7 Waiver

 

Section 2 – Becoming a CARA’S Independent Owner

2.1 Becoming an Independent Owner

2.2 Remaining an Independent Owner

 

Section 3 – Operating a Cara’s Distributorship 

3.1 Independent Contractor Status

3.2 Enrollment

3.3 Business Entities

3.4 Minors

3.5 Limitations on Distributorships per Household

3.6 Actions of Household Members or Affiliated Individuals

3.7 Addition of Co-Applicant

3.8 Roll Up

3.9 Sale, Transfer or Assignment

3.10 Separation Due to Divorce or Dissolution

3.11 Succession

3.12 Expenses

 

Section 4 – Responsibilities of a Owner

4.1 Maintain Accurate Information With CARA’S

4.2 Maintain Communication With Downline

4.3 Non-Disparagement

4.4 Reporting Policy Violations

4.5 Company Status

4.6 Personal Information

4.7 Confidential Information

 

Section 5 – Conflicts of Interest

5.1 Participation In Other Direct Sales Companies

5.2 Non-solicitation

5.3 Targeting Other Direct Sellers

5.4 Cross-Sponsoring

5.5 Bonus Buying and Stacking

 

Section 6 – Communication and Confidentiality Within CARA’S

6.1 Downline Activity (Genealogy Reports)

6.2 Communication Opt-in

6.3 OWNER Media and Likeness Use Consent and Release

 

Section 7 – Advertising and Promotion

7.1 General

7.2 Trademarks and Copyrighted Material

7.3 Identification as Owner

7.4 OWNER Websites

7.5 E-Mail or Electronic Advertising

7.6 Online or Other Classified Ads

7.7 Online Auction Sites

7.8 Online Retailing

7.9 Banner Advertising

7.10 “Spam Linking”

7.11 Digital Media Submission

7.12 Product Claims

7.13 Income Claims

7.14 Product Pricing

7.15 Re-Packaging

7.16 Use of Celebrity Name or Likeness

7.17 Scientific Advisory Board and Other Consultants

7.18 International Marketing

7.19 “Pre-Market” International Marketing

7.20 Telemarketing

7.21 Spam

7.22 Third Party Intellectual Property

7.23 Privacy

7.24 Media

7.25 Social Media

7.26 Other Internet Use

7.27 Prohibited Advertising or Promotion

7.27 Not-For-Resale (or NFR Jurisdictions)

7.28 Negative Online Posts

7.29 Implied Approval or Endorsement

 

Section 8 – Sales

8.1 Commercial Outlets

8.2 Trade Shows and Exhibitions

8.3 Inventory

 

Section 9 – Bonuses and Commissions

9.1 Qualifications

9.2 Check Processing

9.3 Replacement Checks

9.4 Adjustments and Clawbacks

9.5 Unclaimed Commissions

9.6 Incentive Trips and Awards

9.7 “70 Percent Rule”

9.8 Preferred Customer Rule

 

Section 10 – Product Ordering

10.1 Purchasing Product

10.2 General Ordering Policies

10.3 Shipping and Back Orders

10.4 Shipment Confirmation

10.5 Customer Payment

10.6 Insufficient Funds

10.7 Third Party Credit Card Use

10.8 Sales Tax

 

Section 11 – Product Returns

11.1 Product Guarantee

11.2 Inventory Repurchase

11.3 Exceptions

 

Section 12 – General

12.1 Identification

12.2 Income Taxes

12.3 Business Pursuits Insurance

12.4 Product Liability Coverage

12.5 Local Rules, Laws, Ordinances or Regulations

12.6 Indemnification

12.7 Exclusion of Damages

12.8 Errors or Questions

 

Section 13 – Dispute Resolution and Remedies

13.1 OWNER Disciplinary Action

13.2 Change of Sponsor (Enroller)

13.3 Change of Placement

13.4 Arbitration

13.5 No Class or Group Actions, Lawsuits or Arbitration

13.6 Injunctive Relief

13.7 Attorney’s Fees

13.8 Jurisdiction and Venue

13.9 Governing Law

13.10 Statute of Limitations

 

Section 14 – Inactivity and Termination

14.1 Cancellation/Termination

14.2 Non-Renewal

14.3 Termination Due to Inactivity

14.3 Involuntary Termination

14.4 Voluntary Cancellation

 

Section 15 – Definitions

 

SECTION 1

Introduction

1.1 Purpose

Cara’s, LLC has developed these Policies and Procedures, which may sometimes be referred to as the Distributor Manual, to guide its Independent Owners (OWNER’s) in the successful promotion of Cara’s products and services. These Policies and Procedures will help provide the following benefits:

  1. Protect the rights of all Independent Owners by providing guidelines and a framework within which each Independent OWNER may work in an ethical, effective and secure manner.
  2. Provide an equal and level playing field of opportunity to all Cara’s Independent OWNER’s. All OWNER’s will be treated fairly, reasonably and professionally.
  3. Clearly define the relationship between Cara’s and its Independent Owners.
  4. Inform Independent Owners regarding compliance issues and regulatory requirements. Cara’s requires that all Independent Owners understand and abide by these Policies and Procedures as we work together in promoting the Cara’s products and opportunity. Of course, if any OWNER has any questions with respect to Policies and Procedures, you may contact CARA’S for clarification.

CARA’S will apply these Policies and Procedures fairly and equitably to all OWNER’s but understands that there may be certain cases or circumstances that require special handling or consideration. Any exceptions or extenuating circumstances that may apply will be determined by CARA’S at its sole discretion and will not automatically apply in any other situation or matter unless the applicable policy or procedure is officially modified or amended.

1.2 Conduct

Regardless of the specific policies and procedures stated within, all OWNER’s will conduct themselves honestly, ethically, morally and professionally with respect to their CARA’S business and all promotion and sales activity. No OWNER may take any action with respect to CARA’S or that affects CARA’S in any way other than in the fulfillment of their Independent Distributor Agreement. No conduct that negatively impacts CARA’S will be permitted. CARA’S will not tolerate high-pressure sales tactics or the use of any misleading, confusing, false or exaggerated statements or claims with respect to CARA’S or CARA’S products and services.

1.3 Policies and Procedures Incorporated By Reference

These Policies and Procedures, in their present form and as amended from time to time at the sole discretion of Cara’s, LLC (“Cara’s Naturals®” or the “Company” or “CARA’S”), are incorporated into, and form an integral part of, the Cara’s Independent Distributor Agreement. Throughout these Policies and Procedures, when the term “Agreement” is used, it collectively refers to the Cara’s Independent Distributor Agreement and its Terms and Conditions, these Policies and Procedures and the Cara’s Compensation Plan. 

These documents are incorporated by reference into the Cara’s Independent Distributor Agreement. It is the responsibility of each Owner 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 enrolling a new Independent Owner, it is the responsibility of the Enroller (as further defined below) to provide the most current version of these Policies and Procedures and the Cara’s Compensation Plan (which can be done by directing the applicant to the CARA’S website) to the applicant prior to his or her execution of the Independent Distributor Agreement.

1.4 Amendments, Revisions and Changes

In order to ensure that CARA’S is always in compliance with applicable federal, state and/or local laws, as well as being able to adapt to changing or evolving business environments and markets, CARA’S reserves the right, in its sole discretion, to amend, revise or change the OWNER Agreement (including, without limitation, the Independent Distributor Agreement, Terms and Conditions, Policies and Procedures and the Compensation Plan) and its prices and product offering. CARA’S will notify OWNERs by posting any amendments, revisions or changes on the CARA’S corporate website. 

The most current and controlling version will always be posted on www.carasnaturals.com or another applicable website as noticed. It is the responsibility of all OWNER’s to regularly review the company website as well as stay current on all notices given through the various communications between CARA’S and OWNER’s. An OWNER’s continued use of any CARA’S- related website, product or service, the conduct of any CARA’S related business or the acceptance of any compensation under the Compensation Plan will indicate acceptance of any published amendments, revisions or changes. An OWNER not wishing to be bound by such amendments, revisions or changes must resign and will not be able to conduct any CARA’S business.

1.5 Delays

CARA’S 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, acts of Providence, severe weather, riot, war, fire, death, curtailment, reduction, limitation or unavailability of a source of supply, or government decrees or orders.

1.6 Severability

If any provision of the Agreement or these Policies and Procedures, in its current form or as may be amended, is found to be invalid or unenforceable for any reason, only the invalid or the unenforceable portion of the provision shall be severed and only in the applicable jurisdiction that requires it. 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 or these Policies and Procedures.

1.7 Waiver

CARA’S reserves the right to demand compliance with all terms and conditions under the Agreement and/or these Policies and Procedures at any time. No failure of CARA’S to exercise any right or power under the Agreement or to insist upon strict compliance by a OWNER 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 CARA’S’s right to demand exact compliance with the Agreement. Waiver by Cara’s can be affected only in writing by an authorized officer of the Company. Cara’s waiver of any particular breach by an Independent Owner shall not affect or impair Cara’s Naturals rights with respect to any subsequent breach, nor shall it affect in any way the rights or obligations of any other Independent Owner. Nor shall any delay or omission by Cara’s to exercise any right arising from a breach affect or impair Cara’s rights as to that or any subsequent breach. The allegation or existence of any claim or cause of action of an Independent Owner against Cara’s shall not constitute a defense to Cara’s enforcement of any term or provision of the Agreement.

 

SECTION 2

BECOMING AN INDEPENDENT OWNER

2.1 Becoming a CARA’S Independent Owner

To become an independent CARA’S Owner, you must be a minimum of 21 years of age or the legal age of majority in the state, country or jurisdiction you reside in, whichever is higher, and you must be legally capable of entering into a contract. You must be legally entitled to earn income in the United States or in the appropriate country or jurisdiction you intend to do business in as we expand internationally. 

You must submit a valid, complete and accurate Independent Distributor Agreement, whether online or in paper form, to CARA’S and that application must be accepted by CARA’S, at our sole discretion. All information requested, including a valid social security number or tax ID number where applicable must be provided. You may not have a financial interest in more than one distributorship or Owner account. A husband and wife are only permitted to have one distributorship between them unless they follow the procedure for a husband and wife to have separate distributorships as explained in these Policies and Procedures. A validly formed business entity may become an OWNER, provided it can submit valid documentation as may be requested by CARA’S. An individual may not participate in multiple distributorships through the use of business entities. No “ghost” distributorships (false distributorships set up to maintain a position in the genealogy) are permitted.

2.2 Remaining a CARA’S Independent Owner

In order to remain a CARA’S OWNER in good standing, you must abide by all terms and conditions, policies and procedures, rules, regulations, requirements and/or qualifications that exist now or as may be modified from time to time. This includes complying with the renewal policy as may exist at the end of your applicable distributorship term. The initial distributorship term will be for a period of one year. You must only conduct CARA’S business in jurisdictions where we are legally permitted to conduct business. Further, you must comply with any laws, codes, rules, regulations and/or statutes that may be in effect in any jurisdiction you reside in or do business in. Your conduct or the conduct of anyone acting for or on your behalf may not discredit or bring any harm to CARA’S or any associated person or entity. Under no circumstances may any CARA’S OWNER bad-mouth, disparage or discredit CARA’S, its products and services, any associated entities or people, any owners, directors, employees, agents or independent distributors. Any distributorship found to exist for reasons detrimental to CARA’S or the 

compensation plan, including, but not limited to “stacking” or manipulating the compensation plan, may be suspended or terminated at CARA’S’s sole discretion.

 

SECTION 3

Operating a CARA’S Distributorship

3.1 Independent Contractor Status

All CARA’S OWNER’s, regardless of rank or level within the compensation plan, are independent contractors. There are no franchises, exclusive territories, exclusive distributorships, partnerships, joint ventures or strategic alliances created between any CARA’S OWNER and CARA’S. All OWNER’s will have an equal opportunity to build their independent business, based on work ethic, hours put into promoting your business, dedication to building your business, etc. Each independent distributor shall be responsible for paying any and all local, state or federal taxes or fees, including, but not limited to, income taxes, social security, and self-employment taxes. CARA’S OWNER’s are not entitled to employee benefits from CARA’S, including, but not limited to, unemployment benefits, worker’s compensation or minimum wage. All CARA’S OWNER’s are responsible for their own fees, costs, expenses, supplies, tools or whatever is required, used or needed in building and promoting their business. No OWNER may bind CARA’S or any associated person or entity into any contract or agreement, nor may any OWNER imply that they are acting for or on behalf of the corporate entity. Further, no OWNER may contact any media, seek out media coverage or appear on or in any media for or on behalf of CARA’S unless requested by CARA’S or approved by CARA’S in writing. All OWNER’s must properly identify themselves as independent contractors when conducting business. Any conduct or behavior that in any way implies a corporate relationship or is confusing or misleading as to an OWNER’s independent contractor status is prohibited.

3.2 Enrollment

All new CARA’S OWNER’s must be referred or enrolled by an existing CARA’S OWNER and that personal enrollment must be noted during the OWNER enrollment process, whether submitted online or otherwise. It is each OWNER’s responsibility to ensure that they indicate the proper enroller when signing up and to ensure that new OWNER’s that they sign up indicate the proper enroller. If there is a problem with the enroller, it is the OWNER’s responsibility to immediately notify CARA’S. We pride ourselves on our integrity and the integrity of our compensation plan. In the event of a dispute over who is the enroller of a new distributor, CARA’S will make its reasonable and best effort to determine who the actual enroller should be, based on facts gathered. The final decision as to personal enrollment shall be at the sole discretion of CARA’S.

3.3 Business Entities

A corporation, limited liability company, partnership, trust, or local equivalent (collectively referred to in this section as a “Business Entity”) may apply to be a CARA’S Independent Owner by submitting a copy of the organizational documents to CARA’S. If an Independent Owner has enrolled online, all required documents and registration form must be submitted to Cara’s within thirty (30) days of the online 

enrollment. If the required documents are not received within the 30-day period, the Independent Owner Application and Agreement shall automatically terminate. All members, partners, shareholders or stakeholders of the relevant Business Entity are jointly and severally liable for any indebtedness, liability or other obligation to CARA’S. An entity cannot have more than one distributorship or financial interest in another distributorship, nor can an individual have any interest in multiple distributorships whether individually or as part of an entity. An individual or entity may only have a second and third position if earned as multiple “Business Centers” as described in the Cara’s Compensation Plan. Individuals or entities may only register as OWNER’s using legal names. An OWNER cannot be signed up or registered with a fictitious business name.

3.4 Minors

Under no circumstances may anyone under the age of 18, or who is considered a minor in any applicable jurisdiction become a CARA’S OWNER. There are no exceptions and parents may not co-sign or operate on behalf of a minor. No existing OWNER should attempt to enroll or sponsor a minor as a CARA’S OWNER.

3.5 Limitations on Distributorships Per Household

An OWNER may only operate or have an ownership interest, legal or equitable, as a sole proprietorship, partner, shareholder, trustee, member, owner or beneficiary in one CARA’S distributorship. So as to avoid any manipulation within the compensation plan, married couples or common-law couples (collectively “Spouse(s)”) who wish to become separate CARA’S OWNERs must sign a separate Independent Distributor Application and Agreement and must have the same enroller. One spouse cannot enroll or sponsor the other spouse. A spouse may be “placed” under their spouse’s Independent Owner account as long as they have the same Enroller. An additional family member, not a spouse, residing in the same household and otherwise eligible to become an OWNER may become any OWNER under the enroller of his/her choice, as long as there is no intent to manipulate the compensation plan.

3.6 Actions of Household Members or Affiliated Individuals

If any member of an OWNER’s immediate household engages in any activity which, if performed by the OWNER, would violate any provision of the Agreement, such activity will be deemed a violation by the OWNER and CARA’S may take disciplinary action pursuant to the Agreement against the OWNER. Similarly, if any individual associated in any way with a Business Entity (collectively “Affiliated Individual”) violates the Agreement, such action(s) will be deemed a violation by the entity, and Cara’s may take disciplinary action against the Business Entity. 

3.7 Addition of Co-Applicant

When adding a co-applicant (either an individual or a Business Entity) to an existing CARA’S distributorship, CARA’S requires a written request, as well as a properly completed Owner Application and Agreement containing the applicant and co-applicant’s Social Security Numbers and signatures. To prevent the circumvention of Section 3.9 (regarding transfers and assignments of a Cara’s distributor account the original applicant must remain as the main party to the original Independent Distributor Application and Agreement. If the original Independent Owner wants to terminate his or her relationship with the Company, he or she must transfer or assign his or her distributor account in accordance with Section 3.9. If this process is not followed, the Independent Owner may be canceled by Cara’s upon the withdrawal of the original distributor account. All bonus and commission checks will be sent to the address of record of the original Independent Owner. Please note that the modifications permitted within the scope of this Section do not include a change of Enroller or Placement Sponsor. There is a processing fee for each change requested, which must be included with the written request and the completed Independent Distributor Application and Agreement. 

3.8 Roll-Up

When a vacancy occurs in a Marketing Organization due to the termination of an OWNER for any reason, each OWNER or Preferred Customer in the first level immediately below the terminated Independent Owner on the date of the Cancellation will be moved to the first level (“Front Line”) of the terminated Independent Owner’s Placement Sponsor (compresses up one level within the Placement Sponsor tree). 

3.9 Sale, Transfer or Assignment

An OWNER may not sell, transfer or assign his/her independent business without the express written consent of CARA’S at CARA’S’s sole discretion. The sale, transfer or assignment of an OWNER business may not be utilized under any circumstances to effect a change of sponsorship, manipulate the compensation plan or negatively impact another OWNER. An existing OWNER may not purchase another CARA’S independent business. Any person or entity selling, transferring or assigning their independent business, assuming they are otherwise in good standing, must wait a period of twelve (12) months before reapplying to become an independent Owner with CARA’S.

3.10 Separation Due To Divorce or Dissolution

Under no circumstances will CARA’S be required to divide, breakup or partially reassign an OWNER position or its downline due to a divorce between spouses or dissolution of any entity. CARA’S will recognize the OWNER as it is registered with CARA’S and will pay any earned commissions or bonuses accordingly. 

CARA’S is under no obligation to take any actions to facilitate such divorce, breakup or dissolution, other than in the normal conduct of CARA’S business under the Agreement. Any split of commissions or bonuses between affected parties will be handled by the parties after receiving the appropriate payment from CARA’S. If the affected parties are unable to effectively conduct CARA’S business or there is any adverse effect to CARA’S or other OWNER’s, CARA’S reserves the right to involuntarily terminate the OWNER’s independent business. A spouse or other party who gives up rights to a CARA’S OWNER independent business as part of a divorce, breakup or dissolution must wait twelve(12) months before reapplying to become an independent Owner with CARA’S.

3.11 Succession 

Upon the death or incapacitation of an OWNER, his/her Independent Distributor account may be passed to his/her heirs. Appropriate legal documentation, such as an original death certificate and notarized copy of a will, trust or other instrument establishing the successor’s rights must be submitted to the CARA’S to ensure the transfer is proper. Accordingly, an Independent Distributor should consult an attorney to assist him or her in the preparation of a will or other testamentary instrument. Whenever a Cara’s Independent Owner account is transferred by a will or other testamentary process, the legal successor in interest acquires all rights previously earned or held by the OWNER but must continue to meet all requirements and qualifications. The successor(s) in interest must: 1) Execute an Independent Distributor Application and Agreement; 2) Comply with terms and provisions of the Agreement; 3) Meet all of the qualifications for the deceased Independent Distributor‘s status; 4) Bonus and commission checks of a Cara’s Independent Distributor transferred pursuant to this Section 4.11 will be paid in a single electronic payment jointly to the legal successor(s) in interest. Such successor(s) must provide Cara’s with an “address of record” to which all bonus and commission payments will be sent. 5) If the Independent Distributor is bequeathed to multiple legal successors in interest, they must form a Business Entity and acquire a federal taxpayer identification number. Cara’s will issue all bonus and commission checks and a Form 1099 as required by the IRS. CARA’S is under no obligation to divide any distributorship among heirs and under no circumstances will CARA’S allow any OWNER or OWNER Successor to operate in any way other than as normally prescribed under the Agreement or Policies and Procedures. 

3.12 Expenses

No OWNER is required to spend any specific amount in the operation or promotion of his/her independent business. How much may be appropriate for any OWNER to spend on marketing or any other item related to CARA’S is entirely up to the OWNER based on his/her given situation. Unless specifically provided for under these Policies and Procedures or through the CARA’S Compensation Plan, no OWNER is entitled to reimbursement from CARA’S for any general or administrative costs, fees or expenses or any type generated in the conduct of OWNER with respect to CARA’S or the CARA’S agreement.

SECTION 4

Responsibilities of a Owner

4.1 Maintain Accurate Information With CARA’S

All OWNER’s must immediately notify CARA’S of any changes in the original application information. This includes, but is not limited to, actual address, mailing address, telephone number, e-mail address, etc. This may be done through your back office, in writing or via e-mail. Please allow for up to thirty days for all changes to be fully implemented.

4.2 Maintain Communication With Downline

Any OWNER who sponsors another OWNER into CARA’S must perform a bona fide supervisory function to ensure that his or her downline is properly operating his or her CARA’S business. OWNER’s must have ongoing contact, communication, and management supervision with the OWNER’s in their Downline. Examples of such contact and supervision may include but are not limited to: newsletters, written correspondence, personal meetings, telephone contact, voice mail, electronic or e-mail, and the accompanying of downline OWNER’s to opportunity meetings, training sessions, and other CARA’S functions. 

Upline OWNER’s are also responsible to motivate and train new OWNER’s in CARA’S product knowledge, effective sales techniques, and the Marketing and Compensation Plan. OWNER’s must monitor the OWNER’s in their downlines to ensure they do not make improper product or business claims or engage in any illegal or inappropriate conduct. Upon request, every OWNER should be able to provide documented evidence to CARA’S of his or her ongoing fulfillment of the responsibilities of a Sponsor.

4.3 Non-Disparagement

CARA’S wants to reasonably provide its OWNER’s 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 Customer Support Department. Independent Owners should not, however, disparage, demean, or make negative remarks about CARA’S, other CARA’S OWNER’s or CARA’S directors, officers, employees or other associated individuals or entities, either verbally, written, online or in social media or other forums.

4.4 Reporting Policy Violations

OWNER’s who become aware of a policy violation by another OWNER should submit written report of the violation directly to the attention of the CARA’S Compliance Department so a file can be opened and an investigation conducted. Details of the incidents such as dates, number of occurrences, persons involved and any supporting documentation should be included in the report.

4.5 Company Status

No OWNER may claim or imply that he/she or any other OWNER has advantages with or special privileges with CARA’S. Nor may any OWNER imply that they or any other OWNER is in any way exempt from the same obligations and requirements of every other CARA’S OWNER.

4.6 Personal Information

Any OWNER who receives personal information from or about prospective OWNER’s or customers must take all reasonable steps to maintain its security. 

You should shred or irreversibly delete the personal information of others once it is no longer required. Personal Information is information that identifies, or permits you to contact, an individual or entity. It includes, but is not limited to a Customer’s, potential Customer’s, OWNER’s and prospective OWNER’s name, address, email address, phone number, credit card information, social security or tax identification number and other information associated with these details.

4.7 Confidential Information

“Confidential Information” includes, but is not limited to, the identities, contact information, and/or sales information relating to CARA’S OWNER’s and/or Customers: (a) that is contained in or derived from any OWNER’s respective Back-Office; (b) that is derived from any reports issued by CARA’S to OWNER’s to assist them in operating and managing their CARA’S business; and/or (c) to which an OWNER would not have access or would not have acquired but for his/her affiliation with CARA’S. Confidential Information constitutes proprietary business trade secrets belonging exclusively to CARA’S and is provided to OWNER’s in strict confidence, solely for the purpose of promoting CARA’S in accordance with this Agreement. 

Confidential Information shall not be directly or indirectly disclosed to any third party nor used for any purpose other than for use in fulfilling the Distributor Agreement and in building and managing a CARA’S business. Any violation of this policy shall cause CARA’S irreparable harm for which there is no adequate remedy at law. The parties further agree that the harm to CARA’S should OWNER disclose confidential information outweighs any harm to the OWNER in not disclosing that information such that injunctive relief should be granted to CARA’S. CARA’S shall be entitled to immediate and permanent equitable relief to prevent further violations of this policy and shall be able to obtain such relief in a court of law, despite the arbitration clause applying to disputes arising out of breach of the Agreement.

4.8 Enrollment, Sponsoring, Placement

OWNER’s in good standing may enroll (sponsor) and place others into CARA’S as a direct Preferred Customer or OWNER. A prospective customer or OWNER has the right to choose his/her sponsor and no OWNER may pressure, harass, intimidate or force anyone to buy anything or take any action they do not otherwise wish to take. Further, no OWNER may force or require any prospective or new OWNER or customer to agree to anything or sign any agreement other than the standard CARA’S Distributor Agreement. No OWNER may attempt to sell or promote the products or services of any company, including CARA’S, to anyone not personally-enrolled by the OWNER.

 

SECTION 5

Conflicts of Interest

5.1 Participation in Other Direct Sales Companies

OWNER’s may NOT participate as Distributors in other direct selling or network marketing or multilevel marketing ventures (collectively “Network Marketing Ventures”). Under no circumstances may any OWNER present CARA’S products or business along with any other company’s products, services or opportunities.

5.2 Non-solicitation

During the term of the Agreement and for a period of twelve (12) months after termination for any reason, an OWNER shall not engage in any actual or attempted recruitment or enrollment of any CARA’S OWNER for other network marketing, direct sales or similar ventures, either directly, indirectly or through a third party. This includes, but is not limited to, presenting or assisting in the presentation of another network marketing or direct sales company to any CARA’S OWNER or Customer, or implicitly or explicitly encouraging any CARA’S OWNER or Customer to join another or do business with another company.

  1. For a period of twelve (12) months following the termination of an Independent Distributor Agreement for any reason, the former OWNER is strictly prohibited from recruiting or attempting to recruit any CARA’S OWNER or Preferred Customer for another network marketing or direct sales venture, other than those originally personally enrolled in CARA’S. By agreeing to the OWNER Agreement, each OWNER acknowledges and agrees that CARA’S is trying to protect legitimate business interests by this prohibition and such prohibition is reasonable in its scope and duration.
  2. During the term of the Agreement and for a period of twelve (12) months after its termination or cancellation for any reason, an OWNER may not: (a) Produce, offer or transfer any literature, tapes, CDs, DVDs or other promotional material of any nature for another network marketing or direct sales venture which is used by the OWNER or any third person to recruit CARA’S OWNER’s or Preferred Customers for that or any other network marketing venture; (b) Sell, offer to sell, or promote any competing non-CARA’S products or services to CARA’S OWNER’s or Preferred Customers (any product in the same generic product category as a Cara’s product is deemed to be competing (e.g., any nutritional supplement is in the same generic category as Cara’s nutritional supplements, and is, therefore, a competing product, regardless of differences in cost, quality, ingredients or nutrient content); (c) Offer CARA’S products or promote the CARA’S Compensation Plan in conjunction with any non-CARA’S products, services, business plan, opportunity or incentive; or (d) Offer any non-CARA’S products, services, business plan, opportunity or incentive at any CARA’S meeting, seminar, launch, convention or other CARA’S function, or immediately following such event. 
  3. During the term of the Distributor Agreement and for a period of twelve (12) months after its termination for any reason, OWNER shall not contact any vendor, consultant, employee or agent of CARA’S for the purpose of starting a direct sales company or for the purpose of assisting or joining any existing direct sales company.
  4. During the term of the OWNER Agreement and for a period of twelve (12) months after its termination for any reason, OWNER shall not attempt to copy, manufacture, reverse engineer or produce for sale or distribution any product sold, manufactured by, or produced for CARA’S.

5.3 Targeting Other Direct Sellers

CARA’S does not encourage OWNER’s to target the sales force of another network marketing or direct sales company to sell CARA’S products or to become CARA’S OWNER’s, nor does Cara’s encourage OWNER’s to solicit or entice members of the sales force of another direct sales company to violate the terms of their contract with such other company. OWNER’s will be responsible for their own conduct and CARA’S will not indemnify or defend an OWNER should another company bring any legal action alleging unethical or inappropriate business conduct.

5.4 Cross-Sponsoring

Actual or attempted cross-sponsoring is strictly prohibited. “Cross-Sponsoring” is defined as the enrollment or attempted enrollment of an individual or entity which already has a current customer account or Independent Distributor Application and Agreement on file with CARA’S, or which has had such an agreement within the preceding twelve (12) 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 or any other provision of the Agreement is strictly prohibited. OWNER’s shall not demean, discredit or defame other CARA’S OWNER’s in an attempt to entice another OWNER to become part of a different OWNER’s Marketing Organization. If Cross-Sponsoring is discovered, it must be brought to CARA’S’s attention immediately. CARA’S may take action against the OWNER who changed organizations and/or those OWNER’s who encouraged or participated in the Cross-Sponsoring. CARA’S may also move all or part of the offending OWNER’s downline to his or her original Downline organization if the Company deems it equitable and feasible to do so. However, CARA’S is under no obligation to move the Cross-sponsored Owner’s downline organization, and the ultimate disposition of the organization remains within the sole discretion of CARA’S. OWNER’s waive any and all claims and causes of action against CARA’S arising from or relating to the disposition of the Cross-sponsored Independent Owner’s downline organization.

5.5 Bonus Buying and Stacking

Bonus Buying and/or OWNER Stacking is strictly prohibited and will not be tolerated under any conditions or circumstances. “Bonus buying” is manipulating the compensation plan to generate any bonuses and/or commissions for other than a legitimate product sale and includes, but is not limited to: (1) the enrollment of individuals or entities without their knowledge and/or execution of an Independent Distributor Application and Agreement by such individuals or entities; (2) the fraudulent enrollment of an individual or entity as an Independent Distributor or Preferred Customer; (3) the enrollment or attempted enrollment of non-existent individuals or entities as Independent Distributor or Preferred Customers (4) the use of a credit card by or on behalf of an Independent Owner or Preferred Customer when the Independent Owner or Preferred Customer is not the account holder of such credit card; (5) purchasing Cara’s product on behalf of another OWNER or Customer or under another OWNER number, or Customer ID to qualify for commissions, bonuses or incentives and/or (6) the creation of any order or volume not the result of a legitimate sale transaction in the normal course of business.

“Stacking” includes: (1) the failure to transmit applications to CARA’S in a timely manner or the holding of a member agreement in excess of (2) business days after its execution. (2) The manipulation of member agreements for the purpose of maximizing compensation pursuant to the Compensation Plan (3) providing financial assistance to members, buying products, or drop shipping through another’s account for the purpose of increasing the payout of your sales organization and/or (4) the placing of orders or volume so as to deprive an upline sponsor of commissions or bonuses they should otherwise be entitled to receive.

 

SECTION 6

Communication and Confidentiality Within CARA’S

6.1 Downline Activity (Genealogy Reports)

Downline Activity Reports are available for OWNER access and viewing through the secure OWNER Back Office. All Downline Activity Reports and the information contained therein are confidential and constitute proprietary information and business trade secrets and are owned exclusively by CARA’S. CARA’S will not be responsible for any errors, incorrect or missing information that may be included or excluded from any report. Downline Activity Reports are provided to OWNER’s in strictest confidence and are made available to OWNER for the sole purpose of assisting OWNER’s in working with their respective Downline Organizations in the development of their CARA’S business under the OWNER Agreement. 

OWNER’s should use their Downline Activity Reports to assist, motivate and train their Downline OWNER’s and support their customers. The OWNER and CARA’S acknowledge and agree that, but for this agreement of confidentiality and nondisclosure, CARA’S would not provide Downline Activity 

Reports to the OWNER. A CARA’S OWNER shall not, on his/her own behalf, or on behalf of any other person or entity:

  1. Directly or indirectly disclose any information contained in any Downline Activity Report to any third party;
  2. Directly or indirectly disclose the password or other access code to his/her Back Office or Downline Activity Report;
  3. Use the information to compete with CARA’S or for any purpose other than promoting his/her CARA’S business;
  4. Recruit or solicit any OWNER, or Preferred Customer of CARA’S listed on any report, or in any manner attempt to influence or induce any OWNER or Preferred Customer, to alter their business relationship with CARA’S;
  5. Use or disclose to any person or entity any information contained in any Downline Activity Report. Upon demand by the Company, any current or former OWNER will return the original and all copies of any Downline Activity Reports to the Company; and
  6. It is a violation of the OWNER Agreement and these Policies and Procedures for an OWNER or any third party to access any data via reverse engineering, keystroke monitoring, hacking or by any other means.

6.2 Communication Opt-in

OWNER’s agree that CARA’S or a party acting on its behalf may contact you by any means available, including, but not limited to a landline or cellular telephone using automated technology (e.g., an auto-dialer or pre-recorded messaging), text messaging or email. You consent and agree to CARA’Ss contacting you in this manner at the address, telephone number(s) or email address that you provided or as updated. You understand that your carrier’s standard rates may apply for calls and/or text messages. You understand that you may opt-out of receiving text messages at any time by replying “STOP.” You understand that your consent is not a condition of purchase. You consent and agree to the CARA’S Privacy Policy when you agree and submit this OWNER Agreement.

6.3 OWNER Media and Likeness Use Consent and Release

By submitting the CARA’S Distributor Agreement, you authorize CARA’S to use your name, testimonials, and/or likeness in any CARA’S advertising or promotional materials in any media without remuneration. Additionally, you consent to and authorize the use and reproduction of any photographs taken by or supplied to CARA’S and further consent to the use and reproduction of any quotes, testimonials, stories, conversations on social networking media for any print or electronic publicity, marketing or promotional purposes, without remuneration. 

 

SECTION 7

Advertising and Promotion

7.1 General

Any advertising or promotion must safeguard the good reputation of CARA’S and demonstrate good business practice. Under no circumstances is it ever permissible to use unprofessional, discourteous, false, deceptive, misleading, unethical or immoral conduct, claims or practices in the promotion of CARA’S and its products. OWNER’s must take all reasonable care to ensure that any advertising, promotion or postings are professional, grammatically correct and non-offensive. OWNER’s should only use the sales aids and support materials produced by CARA’S. We have carefully designed our products, product labels, Compensation Plan and promotional materials to ensure that the presentation of each aspect of CARA’S is professional, fair, truthful, substantiated, accurately presented and in compliance with applicable laws or regulations. CARA’S reserves the right, at its discretion, to edit or discontinue previously approved OWNER materials. Cara’s further reserves the right to rescind approval for any sales tools, promotional materials, advertisements or other literature, and OWNER’s waive all claims for damages or remuneration arising from or relating to such rescission. As these compliance policies are vital to the long-term stability of CARA’S and the preservation of the opportunity for all, these advertising policies will be strictly enforced. Using non-approved material or failing to obtain approval for marketing materials of any kind may result in disciplinary actions set forth including, without limitation, the following:

  1. The formal warning letter and/or probation;
  2. Suspension of commissions;
  3. Termination of the Independent Distributor Agreement; and/or
  4. Possible legal action

 

7.2 Trademarks and Copyrighted Material

CARA’S does not allow the use of its trademarks, trade names, designs, symbols or copyrighted material by any person or entity, including OWNER’s, without prior written permission or unless such content is specifically prepared or approved for use. OWNER’s may not produce for sale or distribution, any recorded CARA’S events, speeches and/or presentations without express written consent from CARA’S. Further, OWNER’s may not use any name or portion of any name exactly like, similar to or a variation of any CARA’S product, service, associated person or entity in the title, address, domain name, URL, social media page, username, team names, heading, handle or in any context that could be confusing, misleading or deceptive as to the origin or source of the given material or communication.

7.3 Identification as Independent Owner

In instances where it is permitted under these Policies and Procedures to use the Cara’s name or other related material, it can only be done with proper identification as an Independent Owner. There can never be any situation where there could be confusion as to whether an OWNER was acting as the corporate CARA’S entity. Where it is permitted for an OWNER to use a CARA’S logo, we have made specific Independent OWNER versions of CARA’S logos available in your OWNER Back Office under resources.

7.4 Owner Websites

OWNER’s may only utilize the CARA’S-provided replicating website to promote their CARA’S business. Any other website utilized by an OWNER would have to be completely generic with no direct reference to CARA’S and otherwise compliant with any applicable laws, rules or regulations. The CARA’S replicated websites and corporate website contain professionally prepared material designed to help you promote and sell. Even generic or otherwise unidentified websites may not make any product or income claims which refer to CARA’S or CARA’S products and services.

7.5 E-Mail or Electronic Advertising

An OWNER may not advertise or promote CARA’S or CARA’S products and services or use any CARA’S trademarks or copyrighted material in any electronic media or transmission, including e-mail, the internet, social media or otherwise unless specifically approved by CARA’S. Internet advertising and/or mass promotion must be generic, without the use of CARA’S trademarks, trade names or copyrighted material. “Spamming” or the unsolicited mass distribution of e-mails, faxes or other media in violation of any applicable law, rule or regulation is absolutely prohibited. 

Neither shall any OWNER ever publish, post, upload, distribute or communicate through any media, any unprofessional, inappropriate, profane, obscene, defamatory, misleading, untrue, false, indecent, infringing or unlawful statements, claims, material, information or data.

7.6 Online or Other Classified Ads

OWNER’s may not use classified ads, whether published or online classifieds, including, but not limited to, Craigslist, to list, sell or retail specific CARA’S products, product bundles or the opportunity. Generic ads, designed to solicit responses, are permissible so long as otherwise compliant with any applicable laws, rules or regulations.

7.7 Online Auction Sites

CARA’S and its products and services may not be listed on eBay or other online auctions, nor may OWNER’s enlist or otherwise allow or facilitate a third party to sell CARA’S products on eBay or other online auctions.

7.8 Online Retailing

OWNER’s may not list or sell CARA’S products and services on any retail store or e-commerce site, including Amazon.com or the like (with the exception of their own CARA’S-provided replicated website). Additionally, OWNER’s may not (1) enlist or otherwise allow a third party to sell CARA’S products through or on any online retail store or e-commerce site or (2) sell products to a third party that the OWNER has reason to believe will sell such products on any online retail store, e-commerce site or other unauthorized methods. 

7.9 Banner Advertising

OWNER’s may place approved banner advertisements on third-party websites. They may only use the CARA’S approved templates and images available through the resources section of their CARA’S Back Office. The banner must link directly back to the OWNER’s CARA’S replicated website and cannot be varied, altered, revised or contain any additional information such as pricing, discounts or promotions. Discretion must be used by the OWNER in determining the appropriateness of the third party website that the banner may be posted on and CARA’S reserves the right to request that an OWNER remove a banner ad from a website that CARA’S, in its sole discretion, determines to be inappropriate.

7.10 “Spam Linking”

“Spam linking,” or the multiple consecutive submissions of the same or similar content into blogs, wikis, guestbooks, websites or other publicly accessible online discussion boards or forums is not permitted. This includes blog spamming, blog comment spamming and/or spam-texting. Any otherwise permissible comments an OWNER may make on blogs, forums, guest books, etc., must be unique, informative, relevant and otherwise permissible.

7.11 Digital Media Submission

OWNER’s may not upload, submit or publish CARA’S-related video, audio or photo content to any digital media or website such as Facebook, YouTube, iTunes, Photobucket or a similar site.

7.12 Product Claims

No claims, which include personal testimonials, as to therapeutic, curative or beneficial properties of any products offered by CARA’S may be made except those contained in official CARA’S materials. In particular, no OWNER may make any claim that CARA’S products are useful in the cure, treatment, diagnosis, mitigation or prevention of any diseases or signs or symptoms of a disease. Not only are such claims violations of CARA’S policies, but they potentially violate applicable laws, including, but not limited to, federal and state laws and regulations, such as the Federal Food, Drug, and Cosmetic Act and Federal Trade Commission Act. An OWNER that provides product experience testimonials in any medium should use care to disclose their affiliation with CARA’S, i.e., “Cara’s Independent Owner,” be honest in their testimonial personal experience and assert that they are not claiming that their experience is the typical result experienced by consumers. 

Unless specifically warranted in writing by CARA’S, there are no specific results guaranteed to be achieved as a result of the use or consumption of CARA’S products and services.

7.13 Income Claims

OWNERs may not make income claims, representations or imply that anyone will achieve any specific level of income or success. Further, OWNER’s may not display commission checks, commission statements or other financial records in the promotion of CARA’S.

OWNER’s may truthfully, accurately and fairly explain the CARA’S Compensation Plan and show the possible ways an OWNER can earn commissions or bonuses under the plan. However, guarantees, warranties or assurances that any specific results will be achieved are not permitted. 

Individual results will vary and no previous results should be stated or implied as typical. Hypothetical examples may not be unreasonable or exaggerated.

7.14 Product Pricing

OWNER’s may not advertise or offer to sell CARA’S products or services at any price lower than the suggested retail price of the applicable product. 

Further, no special offers or enticements beyond the normal CARA’S product offerings may be made or packaged with CARA’S products and/or services. Any offer to sell CARA’S products and/or services must be truthful and cannot contain misleading statements such as “lowest price available” which infers that an OWNER is able to sell products at a lower price than other OWNER’s.

7.15 Re-Packaging

No OWNER may re-package, re-brand or otherwise alter packaging or labeling in any way, any CARA’S product or service. The giving of tasting samples at a CARA’S home party or meeting is permitted.

7.16 Use of Celebrity Name or Likeness

No OWNER may imply that CARA’S is associated with or endorsed by a particular person, entity or celebrity. No name or likeness of a celebrity, group or entity may be published by OWNER’s without the prior written approval of CARA’S.

7.17 Scientific Advisory Board and Other Consultants

CARA’S has established relationships with many preeminent scientific, marketing, public relations, business, legal and other professionals. 

OWNER’s must refrain from contacting or attempting to contact any such professional or advisor unless specifically authorized in writing to do so by CARA’S. No OWNER may claim or imply that he/she has any special relationship or privilege with any such professional or advisor.

7.18 International Marketing

OWNER’s are authorized to sell CARA’S products, enroll Preferred Customers or OWNER’s only in countries in which CARA’S is authorized to conduct business as announced in official CARA’S materials or on the CARA’S corporate website. However, before initiating any CARA’S-related activities in any authorized country, an OWNER must first complete and submit the CARA’S International Enrollment Application to the Compliance Department. 

Once such application has been received and approved, as evidenced by written authorization by a member of the Compliance Department, the OWNER may begin activities in any authorized country in accordance with the applicable terms and conditions of that country. 

7.19 “Pre-Market” International Marketing

An OWNER, in preparing for the opening of a new country, prior to the official opening of a country, but after its announcement, may provide business cards and conduct, organize or participate in meetings with no more than five (5) attendees, including the OWNER. Other attendees must be personal acquaintances or acquaintances of personal acquaintances. These meetings must be held in a home or a public establishment but may not be held in a private hotel room. OWNER’s are prohibited from any other Pre-Market conduct, including, but not limited to soliciting persons who are not prior personal acquaintances, importing, selling or distributing CARA’S products, placing unapproved ads or distributing promotional material, collecting money or other consideration, etc. 

7.20 Telemarketing

OWNER’s may not use automated systems, including, but not limited to robo-dialers and computer-assisted devices, nor may they conduct any telephone, fax, computer or other telemarketing activity that does not comply with the Federal Telephone Customer Protection Act or any other federal and/or state laws pertaining to sales and solicitation via electronic devices.

7.21 Spam

OWNER’s may not send or transmit unsolicited e-mails or faxes related to CARA’S via telephone, facsimile, electronic mail or any similar method.

7.22 Third Party Intellectual Property

OWNER’s may not use the intellectual property, including the trademarks, trade names, service marks or intellectual property of any third party in any promotional materials or online postings without proper license or authorization of the owner of that intellectual property. When third party intellectual property is used with authorization, it must be properly identified as the property of the third party, and the OWNER must adhere to any restrictions and/or conditions that the rightful owner of the intellectual property places on its use.

7.23 Privacy

An OWNER must respect the privacy of others in any posting or promotion. OWNER’s are prohibited from using the name, likeness, testimonial, story or information relating to any individual or entity unless authorized to do so. OWNER’s should never engage in gossip, rumors or speculation with respect to people, entities, products or services. It is never permissible under any circumstances to post any false, misleading or unconfirmed information or statements about anyone, anything or any entity in any Online forum or media. 

7.24 Media

OWNER’s may not promote CARA’S or CARA’S products through interviews with the media, whether audio, video, printed or verbal, regardless of distribution or broadcasting method, whether, private, public, local, national or international, unless specifically authorized in writing by CARA’S. 

Media inquiries should immediately be referred to the CARA’S Marketing Communications Department. Further, unless otherwise authorized, OWNER’s may not use any form of media or other mass communication or mass advertising to promote CARA’S or CARA’S products. This would include, but not be limited to television shows, podcasts, news or promotional pieces on television, radio or the internet, etc.

7.25 Social Media

CARA’S maintains a public Facebook page and other public social media forums which it uses to invite potential customers and distributors to learn more about CARA’S. These are not intended to be used by OWNER’s to promote or sell. OWNER’s may not attempt to use such social media to otherwise promote, sell or advertise. CARA’S reserves the right at its sole discretion to remove any non-compliant postings or messages from CARA’S-controlled social media. CARA’S may also maintain private or closed social media forums for various purposes including education and open forum discussions. If an OWNER is invited to join these password protected groups, that OWNER may not allow access or otherwise disseminate the information contained or obtained from a private group.

7.26 Other Internet Use

OWNER’s otherwise complying with these Policies and Procedures may use the Internet, social networking sites, blogs, social media and applications and other sites with content based on user participation as a preliminary step to ultimately drive traffic to their CARA’S replicated website. The goal of such use should not be to close business through those sites, but only to generate interest in finding out more about CARA’S or CARA’S products and services through the replicated website or other CARA’S approved material.

7.27 Prohibited Advertising or Promotion

Under no circumstances may any OWNER ever publish, written or verbally, in any media or forum, post, state, distribute or provide any material or information that could be considered offensive sexually explicit, obscene, pornographic, profane, hateful, threatening, harmful, defamatory, libelous, harassing, racist, discriminatory based on race, ethnicity, creed, religion, gender, sexual orientation, physical disability or otherwise. Further, an OWNER may never publish graphically violent images, solicit unlawful behavior or engage in attacks on any individual group or entity. It shall be at CARA’S’s sole discretion in determining whether such material is prohibited and the OWNER must immediately take down the non-compliant material or face disciplinary action including termination.

7.27 Not-For-Resale (or NFR Jurisdictions)

There are certain countries or jurisdiction where residents of that jurisdiction are permitted to import CARA’S products for personal use only. 

CARA’S or CARA’S products may not otherwise be sold or re-sold in those jurisdictions.

7.28 Negative Online Posts

OWNER’s should not engage or converse online in response to or with respect to negative posts about them. You may report such negative postings to the CARA’S Compliance Department and if there is anything that can be done, CARA’S will take appropriate action.

7.29 Implied Approval or Endorsement

An OWNER may never state, imply or represent that CARA’S or CARA’S products are endorsed, approved or sanctioned by any agency or organization, including, but not limited to the Federal Trade Commission (FTC) or the Food and Drug Administration (FDA). Government regulatory agencies do not approve or endorse any direct selling companies or their products. It is also not permissible to imply the use of or endorsement of CARA’S products by any non-governmental agency, business, group or celebrity.

 

SECTION 8

Sales

8.1 Commercial Outlets

Direct sales are based on personal relationships and CARA’S strongly encourages the retailing of its products and services through personal contact. Therefore, OWNER’s may not display or sell CARA’S products or literature in general retail establishments. OWNER’s may, however, promote CARA’S and CARA’S products through appointment-based establishments such as hair salons, spas or chiropractic offices.

8.2 Trade Shows and Exhibitions

OWNER’s may display and/or sell CARA’S products at trade shows or professional expositions. CARA’S limits this to one OWNER per show, so prior, conditional approval must be obtained through the CARA’S Compliance Department. The Compliance Department will instruct the OWNER what is necessary for final approval which will not be unreasonably withheld and will be based on the first fully-completed submission. CARA’S reserves the right to determine, in its sole discretion, whether a particular trade show or exhibition is inappropriate for displaying any CARA’S products or material. Swap meets, garage sales, flea markets, and similar events are not appropriate venues for the promotion of CARA’S and its products. 

8.3 Inventory

OWNER’s are not required to carry an inventory of products or sales aids. Those may be purchased as needed to fulfill sales to OWNERs or customers. An OWNER may wish to carry a certain level of inventory for quicker fulfillment, but this is optional and based on an OWNER’s individual situation. 

Nothing in this section shall be construed to prevent OWNER’s from maintaining reasonable product on hand to service their customers. The purchasing of inventory simply to qualify for bonuses or commissions is prohibited and no OWNER should do so or encourage others to do so. 

Inventory levels should not unreasonably exceed amounts that can be used, sold or consumed within one month.

SECTION 9

Bonuses and Commissions

9.1 Qualifications

An OWNER is responsible for legitimately fulfilling all requirements and/or qualifications as stated in the CARA’S Compensation Plan. Aside from the requirements and qualifications in the Compensation Plan, OWNER’s must otherwise be in good standing and in compliance with the terms and conditions of the OWNER Agreement and all Policies and Procedures. CARA’S reserves the right in its sole discretion, to change, amend, modify or revise the Compensation Plan as appropriate. Any dispute as to whether a given requirement or qualification was met or achieved by an OWNER will be resolved at the sole discretion of CARA’S.

9.2 Check Processing

If an OWNER chooses to receive a paper check, rather than electronic processing of a commission, bonus or other payment, then a $5.00 check processing fee will apply. Further, no check will issue until the net amount exceeds $12.00. Commissions or bonuses lower than $12.00 will accrue and will not be forfeited so long as OWNER remains active and in good standing. Checks will generate and process through the CARA’S pay portal if the paper check method payout option is chosen by the OWNER.

9.3 Replacement Checks

Any check having to be replaced or reissued will be done so via Hyperwallet which is the company that processes all CARA’S payments to OWNER’s. Please contact Hyperwallet Customer Service for payout issues.

9.4 Adjustments and Clawbacks

CARA’S reserves the right to withhold, adjust or deduct commissions or bonuses from any OWNER as necessary. This may be due to returned products, canceled orders, orders with invalid payments, product buybacks, or qualification rollbacks (where a certain level is no longer achieved based on returned, canceled or invalid orders). Deductions may continue for multiple periods until the full amount is recovered. 

9.5 Unclaimed Commissions

Any commission, bonus or other payment shall be void if not used or negotiated within six (6) months from issuance. OWNER’s are responsible for negotiating any payment within six months. Further, account credits must be used within six (6) months. Payments may be reinstated for a valid reason at CARA’S’s sole discretion, but a $25 charge will apply.

9.6 Incentive Trips and Awards

CARA’S may, in its sole discretion, provide incentive trips and other awards to qualified OWNER’s. CARA’S will determine the guidelines and criteria for such awards. Those awards cannot be deferred, will have no cash value and, if required, CARA’S will issue a 1099 for the applicable amount. 

CARA’S, other than providing the applicable award, will not be responsible for any additional costs, fees or expenses incurred by an OWNER with respect to such award. The OWNER will indemnify, defend and hold CARA’S harmless from any claim, injury, loss or damages sustained by OWNER or guest of OWNER with respect to participation in such trip or award.

9.7 “50 Percent Rule”

CARA’S does not encourage nor does it require inventory loading or large inventory purchases. Therefore, in order to remain qualified to receive commissions or bonuses, OWNER’s are certifying before placing a product order, that they have used, sold or consumed at least 50 percent of products previously purchased. This rule is not intended to discourage the maintaining of reasonable inventory to best service your Preferred customers.

9.8 Preferred Customer Rule

In order to stay qualified for any commissions or bonuses payable under the CARA’S Compensation Plan, OWNER’s must make retail sales, either directly or through CARA’S, to a reasonable amount of preferred customers each month. All OWNER’s must keep records of such sales and may be subject to audit and verification.

 

SECTION 10

Product Ordering

10.1 Purchasing Product

OWNER’s should purchase products directly from CARA’S under his/her OWNER number. OWNER’s are not required to purchase any specific amount of product or level or inventory. Any purchases made from other sources are prohibited and the OWNER will not receive credit for sales volume associated with that order

10.2 General Ordering Policies

It is the OWNER’s responsibility to ensure that all orders, through the mail, internet, telephone or otherwise, contain valid and proper payment. 

When there is improper or invalid payment, CARA’S will make reasonable attempts to obtain valid payment, but if such payment is not received within 5 business days, then the order will not be processed. There are no payment plans, nor are charge-on-delivery, C.O.D. or other deferred payment methods available or accepted.

10.3 Shipping and Back Orders

CARA’S always makes its best effort to expeditiously ship orders. If, however, an ordered item is out of stock, it will be placed on back order and shipped when received into CARA’S inventory. CARA’S will notify OWNER’s if there will be an unreasonable delay and if so, OWNER’s will have the opportunity to cancel or revise the order. Keep in mind that no volume credit will be received, nor will commissions be paid, on canceled orders.

10.4 Shipment Confirmation

CARA’S takes pride in achieving the highest level of shipping efficiency and in the rare situations that there is an error in shipping, will take all reasonable steps to resolve the problem. It is the OWNER’s or recipient’s responsibility, however, to confirm that a product shipment matches the shipping invoice and is undamaged. OWNER’s must immediately notify CARA’S of any shipping discrepancy or damage, but in no event can notice to CARA’S exceed five days from shipments delivery date. OWNER’s who wait longer than five days to notify CARA’S will be deemed to have waived the right to any correction of a shipping problem.

10.5 Customer Payment

OWNER’s should not hold or accept monies from Preferred Customers to be held in anticipation of future orders.

10.6 Insufficient Funds

OWNER’s are responsible for ensuring that there are sufficient funds or credit available in his/her account to cover any monthly Autoship order or subscription. CARA’S is not obligated to contact OWNER’s for any scheduled Autoship order or subscription that does not process due to invalid or insufficient payment. Canceled or unprocessed orders may result in failure to qualify at a given level. CARA’S reserves the right to charge a fee to cover the re-processing of any order due to invalid payment provided at the original time of order. 

10.7 Third Party Credit Card Use

OWNER’s shall not allow other OWNER’s or Customers to use his/her credit card or another form of payment, nor shall any OWNER use or attempt to use another person’s credit card or another form of payment. 

10.8 Sales and Use Tax

CARA’S charges and collects applicable sales and use taxes, based on suggested retail price, on purchases made by OWNER’s or customers and will remit those taxes collected to the respective state taxing authority. OWNER’s who choose to accept responsibility for their own sales tax collection and remittance may submit a valid Sales Tax Exemption Certificate and Sales Tax Registration License. CARA’S in its sole discretion will determine whether such tax exemption papers apply to any given order and no sales tax exemption will ever be retroactive.

 

SECTION 11

Product Returns

11.1 Product Guarantee

CARA’S offers its retail consumers a 30-day guarantee. Product and marketing materials returned within thirty (30) days after the purchaser shall receive a 100% refund of the price actually paid, less shipping and handling costs. Consumers must provide any requested documentation relating to the sale and no refund shall apply to promotional products or samples. OWNER’s must refund any amounts collected by them and not by CARA’S.

11.2 Inventory Repurchase

An Independent Owner who resigns, which resignation must be in writing, may return product or marketing materials purchased within the last six (6) months prior to resignation, or longer if required by law, that is otherwise in good condition and resalable subject to CARA’S’s determination. Upon compliance with all applicable requirements, a full refund, less a 10% restocking fee and shipping and handling costs will be issued by the Company. Any product that cannot be sold or is opened, used, damaged, expired, or within three (3) months of expiration, will not be eligible for a refund. Please allow for up to twenty (20) days from the time that the product is received for the refund to be processed. CARA’S may withhold or deduct any commissions, bonuses or other compensation earned as a result of qualifications utilizing product now being returned. CARA’S Customer Support must be contacted prior to shipping product back, so that you may obtain a Return Merchandise Authorization (“RMA”) number and properly identify the product being returned. The obtaining of an RMA does not mean that the product falls within the repurchase policy. That determination can only be made after the product is received by CARA’S. CARA’S is not under any obligation to accept any returns not properly identified with an RMA number. Further, CARA’S is under no obligation to return any products received that do not fall under the repurchase policy.

11.3 Exceptions

Previously paid bonuses or commissions may be reversed or adjusted as a result of the returns, cancellations and at the sole discretion of CARA’S. Any Commissions paid to the OWNER and his/her upline for the product returned by an OWNER or customer may be debited from the respective upline OWNER’s account or withheld from present or future commission payments. A Owner agrees that he or she will not rely on existing downline volume at the close of a commission’s period, as returns may cause changes to his or her title, rank and/or commissions payout.

 

SECTION 12

General

12.1 Identification

All OWNER’s are required to provide and certify the accuracy of, their Social Security Number, Federal Employer Identification Number, (US & Territory Residents) or equivalent government-issued identification number, to CARA’S on the Independent Distributor Application and Agreement. Such number will be maintained securely by CARA’S and is required for proper tax reporting. Upon enrollment, CARA’S will provide a unique Owner Identification Number (OWNER number) to the OWNER by which he/she will be identified. This number will be used to place orders and track commissions and bonuses.

12.2 Income Taxes

Each OWNER is responsible for paying all applicable local, state, and federal taxes on any income generated as a result of his/her CARA’S business. 

If a CARA’S OWNER is tax exempt, the applicable federal tax identification number must be provided to CARA’S. Every year, as required, CARA’S will provide an IRS Form 1099 MISC (Non-employee Compensation) earnings statement to each U.S. distributor who: (1) had earnings of over $600 in the previous calendar year; (2) made purchases during the previous calendar year in excess of $5,000; or (3) earned an incentive award trip.

12.3 Business Pursuits Insurance

A CARA’S OWNER is responsible for and may wish to arrange insurance coverage for their independent business. Be advised that a homeowner’s insurance policy typically does not cover business-related injuries or the theft of or damage to inventory or business equipment. Each OWNER should contact their insurance agent to make certain that their relevant property is protected. In the U.S., this can often be accomplished with a simple “Business Pursuit” endorsement attached to their present homeowner’s policy. CARA’S will not be responsible for any losses incurred or suffered by an OWNER in the conduct of their CARA’S or other business.

12.4 Product Liability Coverage

CARA’S maintains insurance to protect CARA’S and OWNER’s against product liability claims. CARA’S’s insurance policy extends coverage to OWNERs so long as they are marketing CARA’S products in the regular course of conduct and in accordance with CARA’S policies and applicable laws and regulations. The CARA’S product liability policy may not extend coverage to claims or actions that arise as a result of an OWNER’s misconduct in marketing the products.

12.5 Local Rules, Laws, Ordinances or Regulations

Aside from complying with CARA’S terms and conditions or policies and procedures, OWNER’s are responsible for complying with any applicable law, rule, regulation, statute, requirement or ordinance that may apply to their CARA’S independent business in their applicable jurisdiction, which may be any local area, town, city, county, state or country. It is the OWNER’s responsibility to be aware of any such laws or regulations that may apply to them or their business.

12.6 Indemnification

All OWNER’s agree to indemnify, defend and hold harmless, CARA’S, its owners, directors, employees, consultants, agents, vendors and associated persons or entities from and against any and all claims, demands, liabilities, losses, costs or expenses arising from the conduct of the OWNER in the conducting of any CARA’S business and/or business or conduct arising out of the Distributor Agreement or breach of the Agreement. 

This includes, but is not limited to, court costs or attorney’s fees asserted against, suffered by or incurred by the OWNER or any other OWNER by reason of, directly or indirectly, arising out of or in any way related to or connected with, allegedly or otherwise; OWNER’s activities, OWNER’s breach of any terms of the Independent Distributor Agreement or OWNER’s violation or failure to comply with any applicable federal, state or local law, statute, code, regulation or ordinance. This provision shall survive the termination of the Independent Distributor Agreement.

12.7 Exclusion of Damages

CARA’S, its owners, directors, employees, affiliates, consultants and associated persons or entities shall not be liable under any circumstances to any CARA’S OWNER for any exemplary, indirect, consequential, special or punitive damages for any and all claims, demands or actions resulting or arising from the Independent Distributor Agreement, the function, operation or lack of function or any equipment, website software, delay of any shipment or an act or omission of any CARA’S related party, whether based in contract, tort, negligence, strict liability or any other cause of action. Damages will be limited to compensatory damages limited to the amount of legitimately obtained unsold CARA’S product owned by an OWNER or the actual amount of commissions or bonuses that may be due. 

12.8 Errors or Questions

If an OWNER has questions about or believes that any errors have been made regarding commissions, bonuses, genealogy or charges, the OWNER must notify CARA’S within 15 days of the purported error in question. CARA’S is not responsible for any errors, omissions or problems which are not reported to CARA’S within 15 days.

 

SECTION 13

Dispute Resolution

13.1 OWNER Disciplinary Action

If any OWNER is found to be in violation or breach of any applicable term, condition, policy, procedure, law or regulation pertaining to the Independent Distributor Agreement, CARA’S, at its discretion, may take one or more of the following actions:

  1. Issuance of a warning or admonition;
  2. Directing the OWNER to make immediate corrective measures;
  3. Holding back, in whole or in part, one or more bonus or commission payments;
  4. Reversing, in whole or in part, one or more bonus or commission payments;
  5. Suspending all rights and privileges of an OWNER to conduct CARA’S business pending final outcome;
  6. Canceling or re-assigning one or more OWNER’s or customers deemed not to be legitimately acquired by an OWNER;
  7. Revoking the rights and privileges of a given person or entity with respect to being able to conduct CARA’S business;
  8. Terminating an OWNER or associated OWNER;
  9. The seeking of monetary and/or equitable relief in a court or proceeding of appropriate jurisdiction;

Any other measure or action required to provide an appropriate remedy for injuries caused partially or exclusively by the conduct of the OWNER

13.2 Change of Sponsor (Enroller)

Change of Sponsorship or Enroller is not permitted except to correct reasonable errors or mistakes. If there is a dispute as to the proper sponsor/enroller of an OWNER, then it shall be resolved and determined by CARA’S in its sole discretion. OWNER’s otherwise in good standing who voluntarily resign and remain inactive for twelve (12) months may reapply under a new sponsor with no rights to any former downline or privileges. Written request of re-enrollment must be sent to CARA’S and approved by an authorized CARA’S representative prior to rejoining CARA’S as an OWNER.

13.3 Change of Placement

Change of Placement Sponsor may only be done within 3 business days of placement and only to correct errors or mistakes in the placement sponsorship.

13.4 Arbitration

OWNER’s must attempt to resolve any dispute under this Agreement in an amicable and reasonable way directly with CARA’S. If a CARA’S OWNER feels additional actions are necessary, then all OWNER’s agree that any claim, dispute and/or legal action surrounding the terms and conditions of this Agreement shall be resolved solely and exclusively by arbitration in accordance with the Federal Arbitration Act and under the rules and auspices of the American Arbitration Association (AAA). Any arbitration shall be held in Utah County in the State of Utah, under the Commercial Arbitration Rules of the AAA and conducted by a single arbiter who is an attorney with knowledge of direct sales. 

Such arbitration shall be governed by the laws of the State of Utah, excluding those relating to conflicts of law. Each party to the arbitration shall be responsible for its own costs and expenses of arbitration, including legal and filing fees. The decision of the arbitrator shall be final and binding on the parties. This arbitration clause shall survive any termination of the Independent Distributor Agreement.

13.5 No Class or Group Actions, Lawsuits or Arbitration

OWNER’s agree that there will be no group, mass or class arbitrations or other litigation stemming from the Independent Distributor Agreement for any reason. Any arbitration stemming from the Independent Distributor Agreement shall be conducted solely between the individual OWNER and CARA’S based on the specific allegations and facts applying to that OWNER. Further, OWNER’s agree to keep any arbitration proceeding confidential and not to disclose any aspect of any arbitration except as required by law.

13.6 Injunctive Relief

The arbitration clause notwithstanding, nothing in the Independent Distributor Agreement or these Policies and Procedures shall prevent CARA’S from seeking appropriate equitable or injunctive relief in a court of law. The OWNER acknowledges that the breach of certain portions of the Agreement, including, but not limited to, the protection of confidential or proprietary information and disparagement, would cause irreparable harm to CARA’S, the amount and extent of which would be difficult to estimate or ascertain through arbitration. Therefore, OWNER agrees that CARA’S shall be entitled to equitable or injunctive relief, through a court of appropriate jurisdiction, without the necessity of posting a bond or other security. Such injunctive or equitable relief shall not be the exclusive remedy available to CARA’S.

13.7 Attorney’s Fees

Each party shall bear its own attorneys’ fees and any other costs and expenses incurred in the resolution of any dispute without regard to the outcome.

13.8 Jurisdiction and Venue

Arbitration clause notwithstanding, the parties agree that personal jurisdiction and venue for any dispute arising out of or relating to the Independent Distributor Agreement, including any challenge to or compelling of arbitration, are proper exclusively in the state and/or federal courts located in the State of Utah, County of Utah, and both parties hereby submit to, and waive any objection to, personal jurisdiction or venue in such courts for such purpose.

13.9 Governing Law

Should there be any state or federal court proceedings stemming from the OWNER Agreement, then the interpretation and enforcement of the Agreement shall be governed by and shall be construed and interpreted in accordance with the laws of the State of Utah, without giving effect to conflicts of law principles.

13.10 Statute of Limitations

The time within which any OWNER may bring any legal action against CARA’S shall be the shorter of one year or the applicable statute of limitations for that action. The OWNER agrees that any longer statute of limitations will not apply unless otherwise required by law.

SECTION 14

Inactivity and Termination

14.1 Cancellation/Termination

Any OWNER who cancels, resigns or is terminated, whether voluntarily or involuntarily, will no longer have any rights or privileges as a CARA’S OWNER and will be unable to promote CARA’S products and services, sell CARA’S products and services or receive any compensation, commissions or bonuses under the CARA’S Compensation Plan. Further, no terminated OWNER may ever represent or misrepresent in or on any forum that he/she is still associated with CARA’S. A terminated OWNER is not authorized to utilize any CARA’S materials, trademarks, trade names, service marks or copyrighted material, even if such OWNER that any sales or transactions related to such unpaid commissions will be canceled, reversed, refunded or found to be invalid. 

14.2 Non-Renewal

Any OWNER who fails to complete the renewal process in effect at the appropriate time, including the payment of any renewal fee if applicable, will be deemed to have resigned from CARA’S, will lose all rights and privileges as an OWNER and shall have no right, title, claim or interest to the marketing organization which he/she previously had, and will not be entitled to any commissions or bonuses from the sales generated by the marketing organization or that the non-renewed OWNER may have previously been entitled to receive. A non-renewed OWNER who was otherwise in good standing and who has remained inactive for at least six months may reapply to become an OWNER under any sponsor and starting from scratch as if they had never been a CARA’S OWNER.

14.3 Termination Due to Inactivity

A CARA’S independent OWNER has the responsibility to lead his or her marketing organization with the proper example in personal production of sales to end consumers. Without this proper example and leadership, the OWNER will lose his or her right to receive commissions from sales generated through his or her marketing organization. Owners who personally generate less than 40 in Personal Qualification Volume (PQV) for any pay period will not receive a commission for the sales generated through his or her marketing organization for that pay period. If an Independent Owner has not fulfilled his or her PQV requirement for a period of twelve (12) consecutive calendar months, his/ her Agreement shall be canceled for inactivity and the OWNER shall be deemed terminated. The Cancellation will become effective on the day following the last day of the twelfth month of inactivity. Owners may reapply as a new Owner only after a twelve (12) month period has elapsed from the day of cancellation.

14.3 Involuntary Termination

An OWNER’s breach of any of the terms of the Agreement may result in any of the actions discussed in Section 13.1, including involuntary termination. Unless otherwise provided for in the termination notice, termination shall be effective on the date on which written notice is mailed, faxed or delivered to an express courier to the Independent Owner’s last known address (or fax number), or his or her attorney, or when the Independent Owner receives actual notice of cancellation, whichever occurs first. OWNER’s involuntarily terminated may not ever reapply to become an OWNER as an individual or as part of an entity.

14.4 Voluntary Cancellation

Any OWNER has the right to cancel the Agreement at any time. Cancellation must be submitted in writing to CARA’S at its then current business address, faxed to CARA’S at its current business address, or a copy may be submitted to CARA’S email address of [email protected] The written notice must include the OWNER’s signature, printed name, address and OWNER account number. However, if an Independent Owner is not in good standing with the Company at the time Cara’s receives notice of cancellation, the consequences of an involuntary cancellation may take effect (as per Section 12). Independent Owners may reapply as a new Independent Owner after a cancellation letter is received for their current OWNER account and a six (6) month period of complete inactivity has elapsed or a twelve (12) month period of complete inactivity has elapsed from the day of the most recent qualifying order, and only after contacting and receiving approval from an authorized CARA’S company representative.

 

SECTION 15

Definitions

Acceptance – means the acceptance by CARA’S of the application to become an OWNER after the completion of an Independent Distributor Application and Agreement and submission or delivery to CARA’S via online submission or another delivery service. “Acceptance” shall be deemed to occur when CARA’S receives and approves an Independent Distributor Application and Agreement by assigning an OWNER account number and officially placing the new OWNER in the CARA’S computer database system. However, CARA’S may revoke acceptance at its sole discretion at any time within the first 30 days.

Active or Active Independent Owner – means an OWNER who satisfies the minimum Personal Qualification Volume requirements for a given time period, as set forth in the CARA’S Compensation Plan, to ensure that he/she is eligible to receive rebates, bonuses and/or commissions.

Active Rank – means the current rank of an OWNER, as determined by the CARA’S Compensation Plan, for a given bonus period. To be considered “Active” relative to a particular rank, an OWNER must meet the criteria set forth in the CARA’S Compensation Plan for his/her respective rank. (See the definition of “Rank” below.) 

Agreement – means the contract between CARA’S and each OWNER that all OWNERs must agree to in order to transact business with CARA’S. This includes the OWNER Distributor Application and Agreement, the CARA’S Policies and Procedures, the CARA’S Compensation Plan, Autoship Agreement, and the Business Entity Form (where appropriate), all in their current form or as amended by Cara’s from time to time in its sole discretion. These documents are incorporated by reference into the Independent Distributor Agreement and are collectively referred to as and comprise the “Agreement.” 

Smartship Agreement – means the optional CARA’S program that automatically ships the product to OWNER’s. Smartship offers convenience but is not required as long as applicable requirements and qualifications are otherwise met. 

Breach – “Breach,” “Default” and “Violation” mean an actual or alleged transgression or violation of any part of the Agreement. 

Cancellation – means the termination of an Independent Distributor Agreement. Cancellation may be either voluntary or involuntary, through non-renewal, inactivity or disciplinary action. 

Commissionable Volume – means the value assigned to all CARA’S products on which commissions and/or bonuses may be paid. Such value may be less than the retail or wholesale price of such product. Business starter kits and sales aids do not contain Commissionable Volume. 

Company – means Cara’s, LLC and may also be referred to as CARA’S. 

Customer or Preferred Customer – means Retail Customer. Customers may purchase a product for personal use only and may not resell the product. An OWNER participating in the CARA’S Compensation Plan is not a Customer.

Retail Customer – means a customer who purchases directly from Cara’s at retail prices and who is not an OWNER. Customers may purchase a product for personal use only and may not resell the product. An OWNER participating in the CARA’S Compensation Plan is not and may not act as a Retail Customer.

Downline – means the network of Independent Owners and Customers who exist under an Independent Owner account. Independent Owner understands that (1) Independent Owner does not have any ownership or possessory right, title or interest in any downline individual, entity, organization or in any materials generated by Cara’s or created by Independent Owner or any other individual or entity to the extent that it consists, in whole or in part, of any information about Cara’s downlines or any part of the Agreement; (2) the sole property interest of an Independent Owner with respect to downlines is the contractual right to receive commissions as set forth in the Agreement; and (3) that Cara’s is the sole owner of any and all downline rights, titles, interests, and materials. 

Downline Activity Report – means a monthly report generated by CARA’S that provides critical data relating to the identities of OWNER’s, Customers, sales information and enrollment activity of each OWNER’s marketing organization. This report contains confidential and trade secret information which is proprietary to CARA’S and is owned solely by CARA’S.

End Consumer (or End-Use Consumer) – means a person who purchases CARA’S products for the purpose of personal consumption rather than that of reselling them to someone else.

Enrolled – means the OWNER’s and Customers who have been signed up as CARA’S OWNER’s or Customers by an OWNER.

Enroller – means the OWNER who enrolls or sponsors a new OWNER or Customer into CARA’S. The enroller may “place” the new OWNER or Customer under himself or herself, or may place the new OWNER or Customer under any eligible downline OWNER. The person whom the new OWNER or Customer is placed under is the new Independent Owner’s “placement sponsor.” The same OWNER may be a new Independent Owner’s “Enroller” and “Placement Sponsor.” See the definition of “Placement Sponsor” below.

Team Volume (TV) – means the commissionable value of the CARA’S product sales generated by an OWNER’s marketing organization. Group Sales Volume does not include the Personal Sales Volume (PV) of the subject OWNER nor does it include and starter kits or non-product sales aids.

Immediate Household – means heads of household and dependent family members residing at the same house.

Independent Owner – means an independent contractor who has signed and completed the official CARA’S Independent Distributor Application and Agreement and whose Agreement has been accepted by CARA’S. May also be referred to as an OWNER. An OWNER is required to meet certain qualifications and is responsible for the training, motivation, support, and development of the OWNER’s in their respective marketing organization. OWNER’s are entitled to purchase CARA’S products at wholesale prices, enroll Customers and new OWNER’s, and participate in the Compensation Plan. Preferred Customers are not Independent Owners.

Level – means the layers of downline OWNER’s in a particular OWNER’s marketing organization. This term refers to the relationship of an OWNER relative to a particular upline OWNER, determined by the number of OWNER’s between them who are related by sponsorship. For example, if A is the sponsor of B, B is the Sponsor of C, C is the sponsor of D, and D is the sponsor of E, then E is on A’s fourth level.

Marketing Organization – means the Independent Owners and Customers who are enrolled or sponsored below a particular Independent Owner or Customer.

Official Cara’s Material – means literature, audio or digital recordings and other materials developed, printed, published and distributed by Cara’s to Independent Owners.

Qualifying Sales Volume (QV) – means the commissionable value of Cara’s products generated by an Independent Distributors marketing organization, including the Independent Owner’s Personal Sales Volume (PV).

Personal Production – means selling a product to an end consumer for personal use.

Personal Sales Volume (PV) – means the commissionable value of products sold in a calendar month: (1) shipped by CARA’S to an Independent Owner; and/or (2) shipped by CARA’S to the Independent Owner’s personally enrolled Direct Preferred Customers and Preferred Customers.

Placement (sometimes referred to as Sponsor or Placement Sponsor) – means an Independent Owner or Customer under whom the enroller places a new Independent Owner or Customer.

Rank – means the “title” that an Independent Owner has achieved pursuant to the Cara’s Compensation Plan.

Cross Recruit – means, actually or attempting to solicit, enroll, encourage or attempt to influence in any other way, either directly or through a third party, another Cara’s Independent Owner or Customer, Direct or Retail, to enroll or participate in another multilevel marketing, network marketing, direct sales or affiliate program opportunity. This conduct constitutes cross recruiting even if the Independent Owner’s actions are in response to an inquiry made by another Independent Owner or Customer.

Restockable and Resalable – means products and sales aids when returned to CARA’S, if each of the following elements is satisfied: (1) they are unopened and unused; (2) packaging and labeling has not been altered or damaged; (3) the product and packaging are in a condition such that it is a commercially reasonable practice within the trade to sell the merchandise at full price; (4) products are returned to Cara’s within thirty (30) days from the date of purchase; (5) the product expiration date has not elapsed; and (6) the product contains current Cara’s labeling. Any merchandise that is clearly identified at the time of sale as nonreturnable, discontinued or as a seasonal item shall not be resalable.

Retail Profit – means the difference between the wholesale price (as defined below) of products and the retail price an Independent Owner receives for products when they are resold.

Roll-Up – means the method by which a vacancy is filled in a marketing organization left by an OWNER or Preferred Customer whose respective Agreement has been canceled.

Owner or Business Starter kit – means a selection of Cara’s training materials and business support materials that can assist each new Independent Owner in the promotion of their CARA’S independent business. This purchase may be optional in some states and is not commissionable.

Suggested Retail Price (SRP) – means the price at which Cara’s suggests Independent Owners promote or sell a particular product or materials to preferred customers.

Upline – means the Independent Owners(s) above a particular Independent Owner in a sponsorship line or enrollment line up to the Company. Conversely stated, it is the line of sponsors or enrollers that links any particular Independent Owner or Customer to the Company.

Wholesale or Wholesale Price – means the price of the products that are paid to the Company by OWNER’s. The wholesale price is also called the OWNER Cost. All commissions and/or bonuses are paid on Commissionable Volume of Cara’s products, regardless of wholesale or retail pricing.