STATEMENT OF POLICIES
Effective Jan. 1, 2015
SECTION 1 – INTRODUCTION
SECTION 1 – 1 – Policies and Compensation Plan Incorporated into Distributor Agreement
These Policies and Procedures and the Compensation Plan (also referred to as the Xervéo Financial Freedom Plan™), in their present form and as amended by Xervéo, LLC (hereafter ‘Xervéo’ or the ‘Company’), are incorporated into, and form an integral part of, the Xervéo Distributor Agreement. It is the responsibility of each Distributor 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.
Throughout these Policies, when the term ‘Agreement’ is used, it collectively refers to the Xervéo Distributor Application and Agreement, these Policies and Procedures, the Xervéo Financial Freedom Plan™, and the Xervéo Business Entity Registration Form (if applicable). These documents are incorporated by reference into the Xervéo Distributor Agreement (all in their current form and as amended by Xervéo).
SECTION 1 – 2 – Changes to the Agreement
Xervéo reserves the right to amend the Agreement and its prices in its sole and absolute discretion. By executing the Distributor Agreement, a Distributor agrees to abide by all amendments or modifications that Xervéo elects to make. Amendments shall be effective thirty (30) days after publication of notice that the Agreement has been modified. Amendments shall not apply retroactively to conduct that occurred prior to the effective date of the amendment.
Notification of amendments shall be published by one or more of the following methods: (1) posting on the Company’s official web site; (2) electronic mail (e-mail); (3) posting in Distributors’ back-offices; (4) inclusion in Company periodicals; (5) inclusion in product orders or bonus checks; or (6) special mailings.
The continuation of a Distributor’s Xervéo business, the acceptance of any benefits under the Agreement, or a Distributor’s acceptance of bonuses or commissions constitutes acceptance of all amendments.
SECTION 1 – 3 – Policies and Provisions Severable
If any provision of the Agreement, in its current form or as may be amended, is found to be invalid or unenforceable for any reason, only the invalid portion(s) of the provision shall be severed and the remaining terms and provisions shall remain in full force and effect. The severed provision, or portion thereof, shall be reformed to reflect the purpose of the provision as closely as possible.
SECTION 1 – 4 – Waiver
The Company never gives up its right to insist on compliance with the Agreement and with the applicable laws governing the conduct of a business. No failure of Xervéo to exercise any right or power under the Agreement or to insist upon strict compliance by a Distributor 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 Xervéo’s right to demand exact compliance with the Agreement. The existence of any claim or cause of action of a Distributor against Xervéo shall not constitute a defense to Xervéo’s enforcement of any term or provision of the Agreement.
SECTION 2 – BECOMING A DISTRIBUTOR
SECTION 2 – 1 – Requirements to become a Distributor
To become a Xervéo Distributor, each applicant must:
Be at least 18 years of age.
Reside in the United States, a U.S. Territory, or any country that Xervéo has officially announced is open for business.
Provide Xervéo with his or her valid Social Security or Federal Tax ID number.
Purchase a Xervéo Virtual Starter Kit (optional for residents of North Dakota, Louisiana, Massachusetts and Wyoming).
Submit a properly completed Distributor Application and Agreement to Xervéo either in hard copy or online format.
Xervéo reserves the right to accept or reject any Distributor Application and Agreement for any reason or for no reason.
SECTION 2 – 2 – Virtual Starter Kits and Product Purchases
Except for the purchase of a Xervéo Virtual Starter Kit, no person is required to purchase Xervéo products or sales aids, or to pay any charge or fee to become a Distributor. In order to familiarize new Distributors with Xervéo products, sales techniques, sales aids, and other matters, the Company requires that they purchase a Virtual Starter Kit. Xervéo will repurchase resalable Virtual Starter Kits from any Distributor who terminates his or her Distributor Agreement pursuant to the terms of Section 7.3.
SECTION 2 – 3 – Distributor Benefits
Once a Distributor Application and Agreement has been accepted by Xervéo, the benefits of the Compensation Plan and the Distributor Agreement are available to the new Distributor. These benefits include the right to:
Sell Xervéo products.
Participate in the Xervéo Compensation Plan (receive bonuses and commissions, if eligible).
Sponsor other individuals as Preferred Customers or Distributors into the Xervéo business and, thereby, build a Marketing Organization and progress through the Xervéo Compensation Plan.
Receive periodic Xervéo literature and other Xervéo communications.
Participate in Xervéo-sponsored support, service, training, motivational and recognition functions, upon payment of appropriate charges, if applicable.
Participate in promotional and incentive contests and programs sponsored by Xervéo for its Distributors.
SECTION 2 – 4 – Term and Renewal of Your Independent Xervéo Business
The term of the Distributor Agreement is one year from the date of its acceptance by Xervéo (subject to prior termination or reclassification pursuant to Section 10). Distributors must renew their Distributor Agreement each year by paying an annual renewal fee of $20.00 on or before the anniversary date of their Distributor Agreement. If the renewal fee is not paid within 30 days after the expiration of the current term of the Distributor Agreement, the Distributor Agreement will be canceled.
Distributors may elect to utilize the Automatic Renewal Program (‘ARP’). Under the ARP, the renewal fee will be charged to the Distributor’s credit card on file with the Company. Distributors without a credit card or bank account must renew by phone, mail, or through their Back Offices.
SECTION 3 – OPERATING AN INDEPENDENT XERVÉO BUSINESS
SECTION 3 – 1 – Distributor Created Marketing Methods and Tools
Distributors must adhere to the terms of the Xervéo Compensation Plan as set forth in official Xervéo literature. Distributors shall not offer the Xervéo opportunity through, or in combination with, any other system, program, sales tools, or method of marketing other than that specifically set forth in official Xervéo literature.
Distributors shall not require or encourage other current or prospective Preferred Customers or Distributors to execute any agreement or contract other than official Xervéo agreements and contracts in order to become a Xervéo Distributor.
Similarly, Distributors shall not require or encourage other current or prospective Preferred Customers or Distributors to make any purchase from, or payment to, any individual or other entity to participate in the Xervéo Compensation Plan other than those purchases or payments identified as recommended or required in official Xervéo literature.
SECTION 3 – 2 – Advertising
SECTION 3 – 2 – 1 – General
All Distributors shall safeguard and promote the good reputation of Xervéo and its products. The marketing and promotion of Xervéo, the Xervéo opportunity, the Compensation Plan, and Xervéo products must avoid all discourteous, deceptive, misleading, unethical or immoral conduct or practices.
To promote both the products and the business opportunity Xervéo offers, Distributors should use sales aids, business tools and materials produced by Xervéo. The Company has carefully designed its products, product labels, compensation plan, and promotional materials to ensure that they are promoted in a fair and truthful manner, that they are substantiated, and that the materials comply with legal requirements of Federal and State laws.
Accordingly, Distributors may only advertise or promote their Xervéo business using approved tools, templates or images acquired through Xervéo. Any materials produced by and acquired through Xervéo are automatically approved for use.
If a Distributor wishes to design his or her own online or offline marketing materials of any kind, the proposed designs must be submitted to the Xervéo advertising department (info@Xervéo.com) for consideration and inclusion in the template/image library. Unless the Distributor receives specific written approval from Xervéo to use such tools, the request shall be deemed denied. Go to the Template Library tab in your back office for guidelines and to access the library.
Distributors may not sell sales aids to other Xervéo Distributors. Therefore, Distributors who receive authorization from Xervéo to produce their own sales aids may not sell such material to any other Xervéo Distributor. Distributors may make approved material available to other Distributors free of charge if they wish, but may not charge other Xervéo Distributors for the material.
Xervéo further reserves the right to rescind approval for any sales tools, promotional materials, advertisements, or other literature, and Distributors waive all claims for damages or remuneration arising from or relating to such rescission.
SECTION 3 – 2 – 2 – Trademarks, Domains, and Copyrights
The name of Xervéo and other names as may be adopted by Xervéo are proprietary trade names, trademarks and service marks of Xervéo (collectively ‘marks’). As such, these marks are of great value to Xervéo and are supplied to Distributors for their use only in an expressly authorized manner. Xervéo will not allow the use of its trade names, trademarks, designs, or symbols, or any derivatives of such marks, by any person, including Xervéo Distributors, in any unauthorized manner without its prior, written permission.
The name Xervéo may NOT be used in any of the following instances: Title, subtitle, header, computer or telephone-based media including social media, team name, personal name or nickname. The text Independent Xervéo Distributor must be used in all instances when referencing and promoting Xervéo. “Independent Xervéo Distributor” must be in the same line as or directly below the title or header and at least half the height of the title and be the same color and style. Example:
Joe Smith Independent Xervéo Distributor-Health for Life
Independent Xervéo Distributor Joe Smith
(801) 555-2255 OR (801) 555-2255
Xervéo Distributors may NOT use Xervéo in a domain name or email address without express written permission from the Company. Examples: www.xerveocompany.com; www.goxerveo.com, email@example.com, etc. Additionally, a Distributor may only use the phrase Independent Xervéo Distributor in telephone greetings or on an answering machine to clearly separate the Distributor’s independent Xervéo business from Xervéo Corporate.
The content of all Company sponsored events is copyrighted material. Distributors may not produce for sale or distribution any recorded Company events and speeches without written permission from Xervéo. Nor may Distributors reproduce for sale or for personal use any recording of Company-produced audio or video tape presentations.
SECTION 3 – 2 – 2 – 1 – Corporate Logos
How Xervéo is represented by our Distributors in advertisements, fliers, handouts, e-mails, and social media posts ultimately reflects back on the Company itself. For this reason, Distributors have the responsibility to represent the company professionally and in the best light. Through the consistent and proper use of Xervéo’s logos and colors, Distributors will appropriately represent the company brand and create easily recognizable Xervéo promotional materials.
Distributors may use Corporate logos and colors provided they adhere to the separate Xervéo Logo Usage Guide.
As mentioned above, if a Distributor wishes to design his or her own online or offline marketing materials of any kind, the proposed designs must be submitted to the Xervéo advertising department (info@Xervéo.com) for consideration and inclusion in the template/image library.
SECTION 3 – 2 – 3 – Media and Media Inquiries
Distributors must not attempt to respond to media inquiries regarding Xervéo, its products, or their independent Xervéo business. All inquiries by any type of media must be immediately referred to Xervéo’s Customer Care Department (info@Xervéo.com). This policy is designed to assure that accurate and consistent information, as well as a proper public image, is presented to the public.
SECTION 3 – 2 – 4 – Unsolicited Email
Xervéo does not permit Distributors to send unsolicited commercial emails unless such emails strictly comply with applicable laws and regulations including, without limitation, the Federal CAN SPAM Act. Any email sent by a Distributor that promotes Xervéo, the Xervéo opportunity, or Xervéo products must comply with the following:
There must be a functioning return email address to the sender.
There must be a notice in the email that advises the recipient that he or she may reply to the email, via the functioning return email address, to request that future email solicitations or correspondence not be sent to him or her (a functioning “opt-out” notice).
The email must include the Distributor’s physical mailing address.
The email must clearly and conspicuously disclose that the message is an advertisement or solicitation.
The use of deceptive subject lines and/or false header information is prohibited.
All opt-out requests, whether received by email or regular mail, must be honored. If a Distributor receives an opt-out request from a recipient of an email, the Distributor must forward the opt-out request to the Company.
Xervéo may periodically send commercial emails on behalf of Distributors. By entering into the Distributor Agreement, Distributor agrees that the Company may send such emails and that the Distributor’s physical and email addresses will be included in such emails as outlined above. Distributors shall honor opt-out requests generated as a result of such emails sent by the Company.
SECTION 3 – 2 – 5 – Unsolicited Faxes
Except as provided in this section, Distributors may not use or transmit unsolicited faxes in connection with their Xervéo businesses. The term “unsolicited faxes” means the transmission via telephone facsimile or computer of any material or information advertising or promoting Xervéo, its products, its compensation plan or any other aspect of the company which is transmitted to any person, except that these terms do not include a fax:
(a) to any person with that person’s prior express invitation or permission; or
(b) to any person with whom the Distributor has an established business or personal relationship.
The term “established business or personal relationship” means a prior or existing relationship formed by a voluntary two-way communication between a Distributor and a person, on the basis of:
(a) an inquiry, application, purchase or transaction by the person regarding products offered by such Distributor; or
(b) a personal or familial relationship, which relationship has not been previously terminated by either party.
SECTION 3 – 2 – 6 – Telephone Directory Listings
Distributors may list themselves as an “Independent Xervéo Distributor” in the white or yellow pages of the telephone directory, or with online directories, under their own name. No Distributor may place telephone or online directory display ads using Xervéo’s name or logo. If a Distributor wishes to post his or her name in a telephone or online directory, it must be listed in the following format:
Independent Xervéo Distributor
SECTION 3 – 2 – 7 – Television and Radio Advertising
Distributors may not advertise on television or radio except with Xervéo’s express written approval.
SECTION 3 – 2 – 8 – Advertised Prices
Distributors may not create their own marketing or advertising materials offering any Xervéo products at a price less than the current Autoship price plus shipping and applicable taxes.
SECTION 3 – 3 – Online Conduct
SECTION 3 – 3 – 1 – Distributor Web Sites
Distributors are provided with a replicated website by Xervéo, from which they can take orders, enroll new Distributors, place customers on the Preferred Customer Autoship program, as well as manage their Xervéo business. Distributors may use only replicated websites provided by Xervéo to promote their Xervéo businesses, and may not create their own websites to directly or indirectly promote Xervéo’s products or the Xervéo opportunity.
SECTION 3 – 3 – 2 – Xervéo Replicated Websites
Distributors receive a Xervéo Replicated Website subscription to facilitate the online buying experience for their customers and enrollments of new Distributors. Distributors are solely responsible and liable for the content they add to their Replicated Websites and must regularly review the content to ensure it is accurate and relevant.
Distributors may not alter the branding, artwork, look, or feel of their Replicated Websites, and may not use their Replicated Websites to promote, market or sell non-Xervéo products, services or business opportunities. Specifically, a Distributor may not alter the look (placement, sizing etc.) or functionality of the following:
1. The Xervéo Independent Distributor Logo
2. The Distributor’s Name
3. Xervéo Corporate Website Redirect Button
4. Artwork, logos, or graphics
5. Original text.
Because Replicated Websites reside on the Xervéo.com domain, Xervéo reserves the right to receive analytics and information regarding the usage of your website.
By default, a Distributor’s Xervéo Replicated Website URL is www.Xervéo.com/. The Distributor must change this default ID and choose a uniquely identifiable website name that cannot:
Be confused with other portions of the Xervéo corporate website
Confuse a reasonable person into thinking they have landed on a Xervéo corporate page
Be confused with any Xervéo name
Contain any discourteous, misleading, or off-color words or phrases that may damage Xervéo’s image
SECTION 3 – 3 – 3 – Domain Names, email Addresses and Online Aliases
Distributors shall not use or register ‘Xervéo’ or any of Xervéo’s trademarks, product names, or any derivative thereof, for any Internet domain name, email address, or online aliases. Additionally, a Distributor cannot use or register domain names, email addresses, and/or online aliases that could cause confusion, or be misleading or deceptive, in that they cause individuals to believe or assume the communication is from, or is the property of Xervéo. If a Distributor registers a domain name that has the word ‘Xervéo’ in it, such Distributor agrees that he or she will transfer the domain to the Company upon the Company’s demand.
SECTION 3 – 3 – 4 – Xervéo Hotlinks
When directing readers to a Xervéo Replicated Website it must be evident from a combination of the link and the surrounding context that the link is to the site of an independent Xervéo Distributor. Attempts to mislead web traffic into believing they are going to a Xervéo corporate site, when in fact they land at a Distributor’s Replicated Website will not be allowed. The determination as to what is misleading or what constitutes a reasonable reader will be at Xervéo’s sole discretion.
SECTION 3 – 3 – 5 – Monetizing Replicated Websites
Distributors may not monetize their Replicated Websites through affiliate programs, adSense or similar programs.
SECTION 3 – 3 – 6 – Online Classifieds
Distributors may not use online classifieds (including Craigslist) to list, sell or retail specific Xervéo products or product bundles. Distributors may use online classifieds (including Craigslist) for prospecting, recruiting, sponsoring and informing the public about the Xervéo business opportunity, provided Xervéo-approved templates/images are used. These templates will identify the Distributor as an Independent Xervéo Distributor. If a link or URL is provided, it must link to the Distributor’s Replicated Website.
SECTION 3 – 3 – 7 – eBay / Online Auctions
Xervéo’s products may not be listed on eBay or other online auctions, nor may Distributors enlist or knowingly allow a third party to sell Xervéo products on eBay or other online auction.
SECTION 3 – 3 – 8 – Online Retailing
Distributors may not list or sell Xervéo products on any online retail store or ecommerce site, nor may a Distributor enlist or knowingly allow a third party to sell Xervéo products on any online retail store or ecommerce site.
SECTION 3 – 3 – 9 – Banner Advertising
Distributors may place banner advertisements on a website provided the Distributor uses Xervéo-approved templates and images. All banner advertisements must link to a Distributor’s Replicated Website. Distributors may not use blind ads (ads that do not disclose the identity of the Company) or web pages that make product or income claims that are ultimately associated with Xervéo products or the Xervéo opportunity.
SECTION 3 – 3 – 10 – Spam Linking
Spam linking is defined as multiple consecutive submissions of the same or similar content into blogs, wikis, guest books, websites or other publicly accessible online discussion boards or forums and is not allowed. This includes blog spamming, blog comment spamming and/or spamdexing. Any comments that a Distributor makes on blogs, forums, guest books etc. must be unique, informative and relevant.
SECTION 3 – 3 – 11 – Digital Media Submission (YouTube, iTunes, Facebook, Pinterest, etc.)
Distributors may upload, submit or publish Xervéo-related video, audio or photo content that they develop and create so long as it aligns with Xervéo values, contributes to the Xervéo community greater good, and is in compliance with Xervéo’s Policies and Procedures. All submissions must clearly identify the submitter as an Independent Xervéo Distributor in the content itself and in the content description tag, must comply with all copyright/legal requirements, and must state that the submitter is solely responsible for the content.
Distributors may not upload, submit or publish any content (video, audio, presentations or any computer files) received from Xervéo or captured at official Xervéo events or in buildings owned or operated by Xervéo without prior written permission.
SECTION 3 – 3 – 12 – Sponsored Links / Pay-Per-Click (PPC) Ads
Sponsored links or pay-per-click ads (PPC) are acceptable. The destination URL must be to the sponsoring Distributor’s Replicated Website. The display URL must also be to the sponsoring Distributor’s Replicated Website, and must not portray any URL that could lead the user to believe they are being directed to a Xervéo Corporate site, or be inappropriate or misleading in any way.
SECTION 3 – 3 – 13 – Social Media
In addition to meeting all other requirements specified in these Policies and Procedures, should a Distributor utilize any form of social media, including but not limited to Facebook, Twitter, LinkedIn, YouTube, or Pinterest, the Distributor agrees to each of the following:
No product sales or enrollments may occur on any social media site. The only way to generate sales through social media is to link to—and only to—the Distributor’s Xervéo Replicated Website.
Any social media site that is directly or indirectly operated or controlled by a Distributor that is used to discuss or promote Xervéo’s products or the Xervéo opportunity may not link to any website, social media site, or site of any other nature, other than the Distributor’s Xervéo replicated website.
During the term of this Agreement and for a period of 12 calendar months thereafter, a Distributor may not use any social media site on which they discuss or promote, or have discussed or promoted, the Xervéo business or Xervéo’s products to directly or indirectly solicit Xervéo Distributors for another direct selling or network marketing program (collectively, ‘direct selling’). In furtherance of this provision, a Distributor shall not take any action that may reasonably be foreseen to result in drawing an inquiry from other Distributors relating to the Distributor’s other direct selling business activities. Violation of this provision shall constitute a violation of the non-solicitation provision in Section 3-11 below.
A Distributor may post or “pin” photographs of Xervéo products on a social media site, but only photos that are provided by Xervéo and downloaded from the Distributor’s Back Office may be used.
If a Distributor creates a business profile page on any social media site that promotes or relates to Xervéo, its products, or opportunity, the business profile page must relate exclusively to the Distributor’s Xervéo business and Xervéo products. If the Distributor’s Xervéo business is cancelled for any reason or if the Distributor becomes inactive, the Distributor must deactivate the business profile page.
SECTION 3 – 4 – Business Entities
A corporation, limited liability company (LLC), partnership or trust (collectively referred to in this section as a “Business Entity”) may apply to be a Xervéo Distributor by submitting a Distributor Application and Agreement along with a properly completed Business Entity Registration Form and a properly completed IRS Form W-9.
The Business Entity and its shareholders, members, managers, partners, trustees, or other parties with any ownership interest in, or management responsibilities for, the Business Entity (collectively ‘Affiliated Parties’) are individually, jointly and severally liable for any indebtedness to Xervéo, compliance with the Xervéo Policies and Procedures, compliance with the Xervéo Distributor Agreement, and all other obligations to Xervéo.
To prevent the circumvention of 3-5 (regarding Sponsorship Changes) and Sections 3-26 (regarding transfers and assignments of a Xervéo business), if any Affiliated Party wants to terminate his or her relationship with the Business Entity or Xervéo, the Affiliated Party must terminate his or her affiliation with the Business Entity, notify Xervéo in writing that he or she has terminated his or her affiliation with the Business Entity, and must comply with the provisions of Section 3-26. In addition, the Affiliated Party foregoing his or her interest in the Business Entity may not participate in any other Xervéo business for six consecutive calendar months in accordance with Section 3-5-3. If the Business Entity wishes to bring on any new Affiliated Party, it must adhere to the requirements of Section 3-26.
The modifications permitted within the scope of this Section do not include a change of sponsorship. Changes of sponsorship are addressed in Section 3-5, below. There is a $25.00 fee for each change requested, which must be included with the written request and the completed Distributor Application and Agreement. Xervéo may, at its discretion, require notarized documents before implementing any changes to a Xervéo business. Please allow thirty (30) days after the receipt of the request by Xervéo for processing.
SECTION 3 – 4 – 1 – Changes to a Business Entity
Each Distributor must immediately notify Xervéo of all changes to type of business entity they utilize in operating their businesses and the addition or removal of Business Affiliated Parties.
SECTION 3 – 5 – Change of Sponsor
Xervéo strongly discourages changes in sponsorship. Accordingly, the transfer of a Xervéo business from one Sponsor to another is rarely permitted. Requests for change of sponsorship must be submitted in writing to the Distributor Services Department, and must include the reason for the transfer. Transfers will only be considered in the following three circumstances:
SECTION 3 – 5 – 1 – Misplacement
In cases in which the new Distributor is sponsored by someone other than the individual he or she was led to believe would be his or her Sponsor, a Distributor may request that he or she be transferred to another organization with his or her entire Marketing Organization intact. Requests for transfer under this policy will be evaluated on a case-by-case basis and must be made within three days from the date of enrollment. The Distributor requesting the change has the burden of proving that he or she was placed beneath the wrong sponsor. It is up to Xervéo’s discretion whether the requested change will be implemented.
SECTION 3 – 5 – 2 – Upline Approval
The Distributor seeking to transfer submits a properly completed and fully executed Sponsorship Transfer Form, which includes the written approval of all parties whose income will be affected by the transfer. Photocopied or facsimile signatures are not acceptable. All Distributor signatures must be notarized. The Distributor who requests the transfer must submit a fee of $50.00 for administrative charges and data processing. If the transferring Distributor also wants to move any of the Distributors in his or her Marketing Organization, each downline Distributor must also obtain a properly completed Sponsorship Transfer Form and return it to Xervéo with the $50.00 change fee (i.e., the transferring Distributor and each Distributor in his or her Marketing Organization multiplied by $50.00 is the cost to move a Xervéo business). Downline Distributors will not be moved with the transferring Distributor unless all of the requirements of this paragraph are met. Transferring Distributors must allow thirty (30) days after the receipt of the Sponsorship Transfer Forms and change fees by Xervéo for processing and verifying change requests.
SECTION 3 – 5 – 3 – Cancellation and Re-application
A Distributor may legitimately change organizations by voluntarily canceling his or her Xervéo business and remaining inactive (i.e., no purchases of Xervéo products for resale, no sales of Xervéo products, no sponsoring, no attendance at any Xervéo functions, no participation in any other form of Distributor activity, no operation of any other Xervéo business, and no income from the Xervéo business) for six (6) full calendar months. Following the six month period of inactivity, the former Distributor may reapply under a new Sponsor. However, the former Distributor’s Marketing Organization will remain in the original line of sponsorship. Xervéo will consider waiving the six month waiting period under exceptional circumstances. Such requests for waiver must be submitted to Xervéo in writing.
SECTION 3 – 6 – Waiver of Claims
In cases in which the appropriate sponsorship change procedures have not been followed, and a downline organization has been developed in the second business developed by a Distributor, Xervéo reserves the sole and exclusive right to determine the final disposition of the downline organization. Resolving conflicts over the proper placement of a downline that has developed under an organization that has improperly switched sponsors is often extremely difficult.
Therefore, Distributors waive any and all claims against Xervéo, its officers, directors, owners, employees, and agents that relate to or arise from Xervéo’s decision regarding the disposition of any downline organization that develops below an organization that has improperly changed lines of sponsorship.
SECTION 3 – 7 – Unauthorized Claims and Actions
SECTION 3 – 7 – 1 – Indemnification
A Distributor is fully responsible for all of his or her verbal and written statements made regarding Xervéo products and the Compensation Plan that are not expressly contained in official Xervéo materials. This includes statements and representations made through all sources of communication media, whether person-to-person, in meetings, online, through social media, in print, or any other means of communication. Distributors agree to indemnify Xervéo and Xervéo’s directors, officers, employees, and agents, and hold them harmless from all liability including judgments, civil penalties, refunds, attorney fees, court costs, or lost business incurred by Xervéo as a result of the Distributor’s unauthorized representations or actions. This provision shall survive the termination of the Distributor Agreement.
SECTION 3 – 7 – 2 – Product Claims
No claims (which include personal testimonials) as to therapeutic, curative or beneficial properties of any products offered by Xervéo may be made except those contained in official Xervéo literature. In particular, no Distributor may make any claim that Xervéo products are useful in the cure, treatment, diagnosis, mitigation or prevention of any diseases. Such statements can be perceived as medical or drug claims, and they may lack adequate substantiation. Not only are such claims in violation of the Distributor Agreement, they also violate the laws and regulations of the United States, Canada, and other countries.
The Federal Drug Administration regulates and oversees the production and sale of nutritional products to assure their safety and proper representation to the public. They also have labeling and packaging standards with which the company must be in compliance. In order to better serve our Distributors and still maintain compliance with the FDA, Xervéo has created company-specific marketing materials and product information sheets for Distributor use. These materials provide compliant messaging Distributors can safely share.
Examples of claims that CANNOT be made regarding any Xervéo product:
Improve sleep by increasing serotonin levels
Safe for children, pregnant and breast feeding women
Stops fat storage
Statements Distributors can use that are safe and compliant:
Helps promote healthy body weight
Helps maintain a healthy metabolism
Supports a feeling of fullness
Supports increased energy
Supports cholesterol levels already in normal range
SECTION 3 – 7 – 3 – Compensation Plan Claims
When presenting or discussing the Xervéo Compensation Plan, Distributors must make it clear to prospective Distributors that financial success with Xervéo requires commitment, effort, and sales skill. Conversely, Distributors must never represent that one can be successful without diligently applying themselves. Examples of misrepresentations in this area include:
It’s a turnkey system
The system will do the work for you
Just get in and your downline will build through spillover
Just join and I will build your downline for you
The company does all the work for you
You don’t have to sell anything
All you have to do is buy your products every month.
The above are just examples of improper representations about the Compensation Plan. It is important that Distributors do not make these or any other representations that could lead a prospective Distributor to believe that he or she can be successful as a Xervéo Distributor without commitment, effort, and sales skill.
SECTION 3 – 7 – 4 – Income Claims
Because Xervéo Distributors do not have the data necessary to comply with the legal requirements for making income claims, a Distributor, when presenting or discussing the Xervéo opportunity or Compensation Plan to a prospective Distributor, may not make income projections, income claims, or disclose his or her Xervéo income (including, but not limited to, the showing of checks, copies of checks, bank statements, or tax records).
SECTION 3 – 8 – Repackaging and Re-labeling Prohibited
Xervéo products may only be sold in their original packaging. Distributors may not repackage, re-label, or alter the labels on Xervéo products. Tampering with labels/packaging could be a violation of Federal and state laws, and may result in civil or criminal liability. Distributors may affix a personalized sticker with the Distributor’s personal/contact information to each product or product container, as long as this is done without removing existing labels or covering any text, graphics, or other material on the product label.
SECTION 3 – 9 – Commercial Outlets
Distributors may not sell Xervéo products from a commercial outlet, nor may Distributors display or sell Xervéo products or literature in any retail or service establishment. Online auction and/or sales facilitation websites, including but not limited to eBay and Craig’s List constitute Commercial Outlets, and may not be used to sell Xervéo products.
SECTION 3 – 10 – Trade Shows, Expositions and Other Sales Forums
Distributors may display and/or sell Xervéo products at trade shows and professional expositions. Before submitting a deposit to the event promoter, Distributors must contact the Customer Care Department in writing for conditional approval, as Xervéo’s policy is to authorize only one Xervéo business per event.
Final approval will be granted to the first Distributor who submits an official advertisement of the event, a copy of the contract signed by both the Distributor and the event official, and a receipt indicating that a deposit for the booth has been paid. Approval is given only for the event specified. Any requests to participate in future events must again be submitted to the Customer Care Department. Xervéo further reserves the right to refuse authorization to participate at any function which it does not deem a suitable forum for the promotion of its products or the Xervéo opportunity. Approval will not be given for swap meets, garage sales, flea markets or farmer’s markets as these events are not conducive to the professional image Xervéo wishes to portray.
SECTION 3 – 11 – Conflicts of Interest
SECTION 3 – 11 – 1 – Non-solicitation
Xervéo Distributors are free to participate in other multilevel or network marketing business ventures or marketing opportunities (collectively ‘network marketing’). However, during the term of this Agreement, Distributors may not directly or indirectly recruit other Xervéo Distributors or Preferred Customers to any other network marketing business.
Following the cancellation of a Distributor’s Independent Distributor Agreement, and for a period of six calendar months thereafter, a former Distributor may not recruit any Xervéo Distributor or Preferred Customer to another network marketing business, with the exception of a Distributor who was personally sponsored by the former Distributor.
During the term of this Agreement and for a period of 12 calendar months thereafter, a Distributor may not use any social media site on which they discuss or promote, or have discussed or promoted, the Xervéo business or Xervéo’s products to directly or indirectly recruit Xervéo Distributors for another direct selling or network marketing program (collectively, “direct selling”). In furtherance of this provision, a Distributor shall not take any action that may reasonably be foreseen to result in drawing an inquiry from other Distributors relating to the Distributor’s other direct selling business activities.
Distributors and the Company recognize that because network marketing is conducted through networks of independent contractors dispersed across the entire United States and internationally, and business is commonly conducted via the internet and telephone, an effort to narrowly limit the geographic scope of this non-solicitation provision would render it wholly ineffective. Therefore, Distributors and Xervéo agree that this non-solicitation provision shall apply nationwide and to all international markets in which Xervéo Distributors are located. This provision shall survive the termination or expiration of the Agreement.
The term “recruit” means the actual or attempted sponsorship, solicitation, enrollment, encouragement, or effort to influence in any other way, either directly, indirectly, or through a third party, another Xervéo Distributor or Preferred Customer to enroll or participate in another multilevel marketing, network marketing or direct sales opportunity.
SECTION 3 – 11 – 2 – Distributor Participation in Other Direct Selling Programs
If a Distributor is engaged in other non-Xervéo direct selling programs, it is the responsibility of the Distributor to ensure that his or her Xervéo business is operated entirely separate and apart from any other program. To this end, the following must be adhered to:
Distributors must not sell, or attempt to sell, any competing non-Xervéo programs, products or services to Xervéo Preferred Customers or Distributors. Any program, product or services in the same generic categories as Xervéo products or services is deemed to be competing, regardless of differences in cost, quality or other distinguishing factors.
Distributors shall not display Xervéo promotional materials, sales aids, or products with or in the same location as any non-Xervéo promotional materials, sales aids, products or services.
Distributors shall not offer the Xervéo opportunity or products to prospective or existing Preferred Customers or Distributors in conjunction with any non-Xervéo program, opportunity, product or service.
Distributors may not offer any non-Xervéo opportunity, products, services or opportunity at any Xervéo-related meeting, seminar, convention, webinar, teleconference, or other function.
SECTION 3 – 11 – 3 – Confidential Information
“Confidential Information” includes, but is not limited to, Downline Genealogy Reports, the identities of Xervéo Preferred Customers and Distributors, contact information of Xervéo Preferred Customers and Distributors, Distributors’ Personal and Group Volumes, and Distributor rank and/or achievement levels.
Confidential Information is, or may be available, to Distributors in their respective back-offices. Distributor access to such Confidential Information is password protected, is confidential, and constitutes proprietary information and business trade secrets belonging to Xervéo. Such Confidential Information is provided to Distributors in strictest confidence and is made available to Distributors for the sole purpose of assisting Distributors in working with their respective Marketing Organizations in the development of their Xervéo business. Distributors may not use any Confidential Information for any purpose other than for developing their independent Xervéo businesses.
Where a Distributor participates in other direct selling or multilevel marketing ventures, the Distributor is not eligible to have access to certain Confidential Information, including, but not limited to, Downline Genealogy Reports. Distributors should use the Confidential Information to assist, motivate, and train their downline Distributors, and for no other purpose. In so doing, a Distributor may not disclose the Confidential Information to any third party, including, without limitation, his or her downline Distributors. The Distributor and Xervéo agree that, but for this agreement of confidentiality and nondisclosure, Xervéo would not provide Confidential Information to the Distributor.
To protect the Confidential Information, a Distributor shall not, on his or her own behalf, or on behalf of any other person, partnership, association, corporation or other entity:
Directly or indirectly disclose any Confidential Information to any third party
Directly or indirectly disclose the password or other access code to his or her back-office
Use any Confidential Information to compete with Xervéo or for any purpose other than promoting his or her Xervéo business
Recruit or solicit any Distributor or Preferred Customer of Xervéo listed on any report or in the Distributor’s Back Office, or in any manner attempt to influence or induce any Distributor or Preferred Customer of Xervéo, to alter their business relationship with Xervéo.
The obligation of a Distributor to not disclose any Confidential Information shall survive cancellation or termination of the Agreement, and shall remain effective and binding irrespective of whether a Distributor’s Agreement has been terminated, or whether the Distributor is or is not otherwise affiliated with the Company.
SECTION 3 – 12 – Targeting Other Direct Sellers
Xervéo does not condone Distributors specifically or consciously targeting the sales force of another direct sales company to sell Xervéo products or to become Distributors for Xervéo, nor does Xervéo condone Distributors solicitation or enticement of members of the sales force of another direct sales company to violate the terms of their contract with such other company.
Should Distributors engage in such activity, they bear the risk of being sued by the other direct sales company. If any lawsuit, arbitration or mediation is brought against a Distributor alleging that he or she engaged in inappropriate recruiting activity of its sales force or customers, Xervéo will not pay any of the Distributor’s defense costs or legal fees, nor will Xervéo indemnify the Distributor for any judgment, award, or settlement.
SECTION 3 – 13 – Errors or Questions
If a Distributor has questions about or believes any errors have been made regarding commissions, bonuses, genealogy lists, or charges, the Distributor must notify Xervéo in writing within 60 days of the date of the purported error or incident in question. Xervéo will not be responsible for any errors, omissions or problems not reported to the Company within 60 days.
SECTION 3 – 14 – Governmental Approval or Endorsement
Neither Federal nor State regulatory agencies or officials approve or endorse any direct selling or network marketing companies or programs. Therefore, Distributors shall not represent or imply that Xervéo or its Compensation Plan have been “approved,” “endorsed” or otherwise sanctioned by any government agency.
SECTION 3 – 15 – Holding Applications or Orders
Distributors must not manipulate enrollments of new applicants and purchases of products. All Distributor Applications and Agreements and product orders must be sent to Xervéo within 72 hours from the time they are signed by a Distributor or placed by a customer, respectively.
SECTION 3 – 16 – Income Taxes
Each Distributor is responsible for paying local, state and Federal taxes on any income generated as an Independent Distributor. If a Distributor’s Xervéo business is tax exempt, the Federal tax identification number must be provided to Xervéo. Every year, Xervéo will provide an IRS Form 1099 MISC (Non-employee Compensation) earnings statement to each U.S. resident who:
Had earnings of over $600 in the previous calendar year; or
Made purchases during the previous calendar year in excess of $5,000.
Xervéo cannot provide Distributors with any personal tax advice. Distributors should consult with their own tax accountant, tax attorney, or other tax professional.
SECTION 3 – 17 – Independent Contractor Status
Distributors are independent contractors. The agreement between Xervéo and its Distributors does not create an employer/employee relationship, agency, partnership, or joint venture between the Company and the Distributor. Distributors shall not be treated as an employee for his or her services or for Federal or State tax purposes. All Distributors are responsible for paying local, State, and Federal taxes due from all compensation earned as a Distributor of the Company. The Distributor has no authority (expressed or implied), to bind the Company to any obligation. Each Distributor shall establish his or her own goals, hours, and methods of sale, so long as he or she complies with the terms of the Distributor Agreement, these Policies and Procedures, and applicable laws.
SECTION 3 – 18 – Insurance
You may wish to arrange insurance coverage for your business. Your homeowner’s insurance policy does not cover business-related injuries, or the theft of or damage to inventory or business equipment. Contact your insurance agent to make certain that your business property is protected. This can often be accomplished with a simple ‘Business Pursuit’ endorsement attached to your present home owner’s policy.
SECTION 3 – 19 – International Marketing
Distributors are authorized to sell Xervéo products, and enroll Preferred Customers or Distributors only in the countries in which Xervéo is authorized to conduct business, as announced in official Company literature. Xervéo products or sales aids may not be shipped into or sold in any foreign country. Distributors may sell, give, transfer, or distribute Xervéo products or sales aids only in their home country. In addition, no Distributor may, in any unauthorized country:
(a) conduct sales, enrollment or training meetings
(b) enroll or attempt to enroll potential Preferred Customers or Distributors; or
(c) conduct any other activity for the purpose of selling Xervéo products, establishing a Marketing Organization, or promoting the Xervéo opportunity.
SECTION 3 – 20 – Excess Inventory and Bonus Buying
Distributors must never purchase more products than they can reasonably use or sell to retail customers in a month, and must not influence or attempt to influence any other Distributor to buy more products than they can reasonably use or sell to retail customers in a month. In addition, bonus buying is strictly prohibited. Bonus buying includes any mechanism or artifice to qualify for rank advancement, incentives, prizes, commissions or bonuses that is not driven by bona fide product purchases by end-user consumers. Bonus buying includes, but is not limited to, purchasing products through a third party (a “straw man”) or through the use of any other artifice.
SECTION 3 – 21 – Adherence to Laws and Ordinances
Distributors shall comply with all Federal, State, and Local laws and regulations in the conduct of their businesses. Many cities and counties have laws regulating certain home-based businesses. In most cases these ordinances are not applicable to Distributors because of the nature of their business. However, Distributors must obey those laws that do apply to them. If a city or county official tells a Distributor that an ordinance applies to him or her, the Distributor shall be polite and cooperative, and immediately send a copy of the ordinance to the Compliance Department of Xervéo.
SECTION 3 – 22 – One Xervéo Business Per Distributor and Per Household
A Distributor may operate or have an ownership interest, legal or equitable, as a sole proprietorship, partner, shareholder, trustee, or beneficiary, in only one Xervéo business. No individual may have, operate or receive compensation from more than one Xervéo business. Individuals of the same Household may not enter into or have an interest in more than one Xervéo Business. A ‘Household’ is defined as all individuals who are living at or doing business at the same address, and who are related by blood, marriage, domestic partnership, or adoption, or who are living together as a family unit or in a family-like setting.
In order to maintain the integrity of the Xervéo Compensation Plan, husbands and wives, domestic partnerships, or common-law couples (collectively referred to herein as “spouses”) who wish to become Xervéo Distributors must be jointly sponsored as one Xervéo business. Spouses, regardless of whether one or both are signatories to the Distributor Application and Agreement, may not own or operate any other Xervéo business, either individually or jointly, nor may they participate directly or indirectly (as a shareholder, partner, trustee, trust beneficiary, or have any other legal or equitable ownership) in the ownership or management of another Xervéo business in any form.
An exception to the one business per Distributor/Household rule will be considered on a case-by-case basis if two people who are already Distributors get married or move in together, or in cases of a Distributor receiving an interest in another business through inheritance. Requests for exceptions to policy must be submitted in writing to the Customer Care Department.
SECTION 3 – 23 – Actions of Household Members or Affiliated Parties
If any member of a Distributor’s immediate household engages in any activity which, if performed by the Distributor, would violate any provision of the Agreement, such activity will be deemed a violation by the Distributor and Xervéo may take disciplinary action pursuant to these Policies and Procedures against the Distributor. Similarly, if any individual associated in any way with a corporation, partnership, LLC, trust or other entity (collectively “Business Entity”) violates the Agreement, such action(s) will be deemed a violation by the Business Entity, and Xervéo may take disciplinary action against the Business Entity. Likewise, if a Distributor enrolls in Xervéo as a Business Entity, each Affiliated Party of the Business Entity shall be personally and individually bound to, and must comply with, the terms and conditions of the Agreement.
SECTION 3 – 24 – Requests for Records
Any request from a Distributor for copies of invoices, applications, downline activity reports, or other records will require a fee of $1.00 per page per copy. This fee covers the expense of mailing and time required to research files and make copies of the records.
SECTION 3 – 25 – Roll-up of Marketing Organization
When a vacancy occurs in a Marketing Organization due to the termination of a Xervéo business, each Distributor in the first level immediately below the terminated Distributor on the date of the cancellation (referred to in this Section as a ‘First Level Distributor’) will have the opportunity to qualify to roll up into the position of the terminated Distributor provided the First Level Distributor has not been in violation of the terms of the Xervéo Distributor Application and Agreement or any Xervéo policy within the previous 12 months.
The roll up will be awarded to the qualified First Level Distributor with the highest Paid-As Rank on the date of the cancellation. In the event of a tie between two or more First Level Distributors, the following criteria will be applied, in the order listed, until the tie is broken:
The Distributor with the largest number of active personally enrolled Preferred Customers
The Distributor whose Marketing Organization has the largest number of active Preferred Customers
The Distributor whose Marketing Organization has the highest average product order (measured by dollar sales) per customer.
Prior to any roll up, Xervéo may audit the Marketing Organization of the First Level Distributor who will receive the roll up. If the First Level Distributor who would be receiving the roll up has any invalid enrollments or sales (i.e., enrollments or sales obtained in violation of these Policies and Procedures) or has been involved in any Policy violations within the preceding twelve (12) calendar months, such Distributor shall be disqualified from receiving the roll up.
SECTION 3 – 26 – Sale, Transfer or Assignment of an Independent Xervéo Business
Although a Xervéo business is a privately owned and independently operated business, the sale, transfer or assignment of a Xervéo business, and the sale, transfer, or assignment of an interest in a Business Entity that owns or operates a Xervéo business, is subject to certain limitations. If a Distributor wishes to sell his or her Xervéo business, or interest in a Business Entity that owns or operates a Xervéo business, the following criteria must be met:
The selling Distributor must offer Xervéo the right of first refusal to purchase the business on the same terms as agreed upon with a third-party buyer. Xervéo shall have fifteen days from the date of receipt of the written offer from the seller to exercise its right of first refusal.
The buyer or transferee must become a qualified Xervéo Distributor. If the buyer is an active Xervéo Distributor, he or she must first terminate his or her Xervéo business and wait six calendar months before acquiring any interest in a different Xervéo business.
Before the sale, transfer or assignment can be finalized and approved by Xervéo, any debt obligations the selling party has with Xervéo must be satisfied.
The selling party must be in good standing and not in violation of any of the terms of the Agreement in order to be eligible to sell, transfer or assign a Xervéo business.
Prior to selling an independent Xervéo business or Business Entity interest, the selling Distributor must notify Xervéo’s Compliance Department in writing and advise of his or her intent to sell his or her Xervéo business or Business Entity interest. The selling Distributor must also receive written approval from the Compliance Department before proceeding with the sale. No changes in line of sponsorship can result from the sale or transfer of a Xervéo business.
SECTION 3 – 27 – Separation of a Xervéo Business
Xervéo Distributors sometimes operate their Xervéo businesses as husband-wife partnerships, regular partnerships, LLCs, corporations, trusts, or other Business Entities. At such time as a marriage may end in divorce, or a corporation, LLC, partnership, trust or other Business Entity may dissolve, arrangements must be made to assure that any separation or division of the business is accomplished so as not to adversely affect the interests and income of other businesses up or down the line of sponsorship.
During the divorce or entity dissolution process, the parties must adopt one of the following methods of operation:
One of the parties may, with consent of the other(s), operate the Xervéo business pursuant to an assignment in writing whereby the relinquishing spouse, shareholders, partners or trustees authorize Xervéo to deal directly and solely with the other spouse or non-relinquishing shareholder, partner or trustee.
The parties may continue to operate the Xervéo business jointly on a ‘business-as-usual’ basis, whereupon all compensation paid by Xervéo will be paid according to the status quo as it existed prior to the divorce filing or dissolution proceedings. This is the default procedure if the parties do not agree on the format set forth above.
Under no circumstances will the Marketing Organization of divorcing spouses or a dissolving business entity be divided. Similarly, under no circumstances will Xervéo split commission and bonus checks between divorcing spouses or members of dissolving entities. Xervéo will recognize only one Marketing Organization and will issue only one commission check per Xervéo business per commission cycle. Commission checks shall always be issued to the same individual or entity.
If a former spouse has completely relinquished all rights in the original Xervéo business pursuant to a divorce, he or she is thereafter free to enroll under any sponsor of his or her choosing without waiting six calendar months. In the case of business entity dissolutions, the former partner, shareholder, member, or other entity affiliate who retains no interest in the business must wait six calendar months from the date of the final dissolution before re-enrolling as a Distributor. In either case, the former spouse or business affiliate shall have no rights to any Distributors in their former Marketing Organization or to any former retail customer or Preferred Customer. They must develop the new business in the same manner as would any other new Distributor.
SECTION 3 – 28 – Sponsoring Online
When sponsoring a new Distributor through the online enrollment process, the Sponsor may assist the new applicant in filling out the enrollment materials. However, the applicant must personally review and agree to the online application and agreement, Xervéo’s Policies and Procedures, and the Xervéo Compensation Plan. The Sponsor may not fill out the online application and agreement on behalf of the applicant and agree to these materials on behalf of the applicant.
SECTION 3 – 29 – Succession
Upon the death or incapacitation of a Distributor, his or her business may be passed to his or her heirs. Appropriate legal documentation must be submitted to the Company to ensure the transfer is proper. Accordingly, a Distributor should consult an attorney to assist him or her in the preparation of a will or other testamentary instrument.
Whenever a Xervéo business is transferred by a will or other testamentary process, the beneficiary acquires the right to collect all bonuses and commissions of the deceased Distributor’s Marketing Organization, provided the following qualifications are met. The successor(s) must:
Execute a Distributor Agreement;
Comply with terms and provisions of the Agreement;
Meet all of the qualifications for the deceased Distributor’s status.
The devisee(s) must provide Xervéo with an “address of record” to which all bonus and commission checks will be sent. If the business is bequeathed to joint devisees, they must form a business entity and acquire a Federal Taxpayer Identification Number. Xervéo will issue all bonus and commission checks and one 1099 to the business entity.
SECTION 3 – 29 – 1 – Transfer Upon Death of a Distributor
To effect a testamentary transfer of a Xervéo business, the executor of the estate must provide the following to Xervéo:
An original death certificate;
Certified letters testamentary or a letter of administration appointing an executor; and
Written instructions from the authorized executor to Xervéo specifying to whom the business and income should be transferred.
SECTION 3 – 29 – 2 – Transfer Upon Incapacitation of a Distributor
To effectuate a transfer of a Xervéo business because of incapacity, the successor must provide the following to Xervéo:
A notarized copy of an appointment as trustee;
A notarized copy of the trust document or other documentation establishing the trustee’s right to administer the Xervéo business; and
A completed Distributor Agreement executed by the trustee.
SECTION 3 – 30 – Telemarketing Techniques
The Federal Trade Commission and the Federal Communications Commission each have laws that restrict telemarketing practices. Both Federal agencies (as well as a number of states) have “do not call” regulations as part of their telemarketing laws. Although Xervéo does not consider Distributors to be “telemarketers” in the traditional sense of the word, these government regulations broadly define the term telemarketer and “telemarketing” so that your inadvertent action of calling someone whose telephone number is listed on the National Do Not Call Registry could cause you to violate the law. Moreover, these regulations must not be taken lightly, as they carry significant penalties.
Therefore, Distributors must not engage in telemarketing in the operation of their Xervéo businesses. The term telemarketing means the placing of one or more telephone calls to an individual or entity to induce the purchase of a Xervéo product, or to recruit them for the Xervéo opportunity. “Cold calls” made to prospective customers or Distributors that promote either Xervéo’s products or the Xervéo opportunity constitute telemarketing and are prohibited. However, a telephone call(s) placed to a prospective customer or Distributor (a “prospect”) is permissible under the following situations:
The Distributor has an established business relationship with the prospect. An “established business relationship” is a relationship between a Distributor and a prospect based on the prospect’s purchase, rental, or lease of goods or services from the Distributor, or a financial transaction between the prospect and the Distributor, within the eighteen (18) months immediately preceding the date of a telephone call to induce the prospect’s purchase of a product or service.
In response to a prospect’s personal inquiry or application regarding a product or service offered by the Distributor, within the three (3) months immediately preceding the date of such a call.
The Distributor receives written and signed permission from the prospect authorizing the Distributor to call. The authorization must specify the telephone number(s) which the Distributor is authorized to call.
The prospect is a family member, a personal friend, or an acquaintance. An “acquaintance” is someone with whom a Distributor has at least a recent first-hand relationship within the preceding three months. Bear in mind, however, that if a Distributor engages in “card collecting” with everyone the Distributor meets and subsequently calls them, the FTC may consider this a form of telemarketing that is not subject to this exemption. Thus, if a Distributor engages in calling acquaintances, the Distributor must make such calls on an occasional basis only and not make this a routine practice.
Distributors shall not use automatic telephone dialing systems or software relative to the operation of their Xervéo businesses. Distributors shall not place or initiate any outbound telephone call to any person that delivers any pre-recorded message (a “robocall”) regarding or relating to the Xervéo products or opportunity.
SECTION 3 – 31 – Back Office Access
Xervéo makes online back offices available to its Distributors. Back offices provide Distributors access to confidential and proprietary information that may be used solely and exclusively to promote the development of a Distributor’s Xervéo business and to increase sales of Xervéo products. However, access to a back office is a privilege, and not a right. Xervéo reserves the right to deny Distributors’ access to the back office at its sole discretion.
SECTION 4 – RESPONSIBILITIES OF DISTRIBUTORS
SECTION 4 – 1 – Change of Contact Information
To ensure timely delivery of products, support materials, commissions, and tax documents, it is important that Xervéo’s files are current. Street addresses are required for shipping. Distributors planning to change any of their contact information or move must update their contact information via the Back Office function of the Distributor’s replicated Xervéo website or send their new contact information to info@Xervéo.com or to Xervéo, P.O. Box 621, Bountiful, UT 84010. To guarantee proper delivery, two weeks advance notice must be provided to Xervéo on all changes.
SECTION 4 – 2 – Continuing Development Obligations
SECTION 4 – 2 – 1 – Ongoing Training
Any Distributor who sponsors another Distributor into Xervéo must perform a bona fide assistance and training function to ensure that his or her downline is properly operating his or her Xervéo business. Distributors must have ongoing contact and communication with the Distributors in their Marketing Organizations. Examples of such contact and communication may include, but are not limited to: newsletters, written correspondence, personal meetings, telephone contact, voice mail, electronic mail, and the accompaniment of downline Distributors to Xervéo meetings, training sessions, and other functions.
Upline Distributors are also responsible to motivate and train new Distributors in Xervéo product knowledge, effective sales techniques, the Xervéo Compensation Plan, and compliance with Company Policies and Procedures. Communication with and the training of downline Distributors must not, however, violate Sections 3-1 and/or 3-2 (regarding the development of Distributor-produced sales aids and promotional materials).
Distributors should monitor the Distributors in their Marketing Organizations to guard against downline Distributors making improper product or business claims, or engaging in any illegal or inappropriate conduct.
SECTION 4 – 2 – 2 – Increased Training Responsibilities
As Distributors progress through the various levels of leadership, they will become more experienced in sales techniques, product knowledge, and understanding of the Xervéo program. They will be called upon to share this knowledge with lesser experienced Distributors within their Marketing Organization.
SECTION 4 – 2 – 3 – Ongoing Sales Responsibilities
Regardless of their level of achievement, Distributors have an ongoing obligation to continue to personally promote sales through the generation of new customers and through servicing their existing customers.
SECTION 4 – 3 – Non-disparagement
Xervéo values constructive criticisms and comments from Distributors. All such comments should be submitted in writing to the Customer Care Department. While Xervéo welcomes constructive input, negative comments and remarks made in the field by Distributors about the Company, its products, or Compensation Plan serve no purpose other than to sour the enthusiasm of other Xervéo Distributors. For this reason, and to set the proper example for their Marketing Organizations, Distributors must not disparage, demean, or make negative remarks about Xervéo, other Xervéo Distributors, Xervéo’s products, the Compensation Plan, or Xervéo’s directors, officers, or employees.
SECTION 4 – 4 – Providing Documentation to Applicants
Distributors must provide the most current version of the Policies and Procedures and the Compensation Plan to individuals whom they are sponsoring to become Distributors before the applicant signs a Distributor Agreement, or ensure that such individuals have online access to these materials.
SECTION 5 – SALES REQUIREMENTS
SECTION 5 – 1 – Product Sales
The Xervéo Compensation Plan is based on the sale of Xervéo products to end consumers. Distributors must fulfill personal and downline organization retail sales requirements (as well as meet other responsibilities set forth in the Agreement) to be eligible for bonuses, commissions and advancement to higher levels of achievement. Distributors must satisfy the Personal Volume and Group Volume requirements to fulfill the requirements associated with their rank as specified in the Xervéo Compensation Plan. “Personal Sales Volume” includes purchases made by the Distributor and purchases made by the Distributor’s personal customers. Group Volume shall include the total Personal Volume of all Distributors in his or her Marketing Organization, but shall not include the Distributor’s Personal Sales Volume.
SECTION 5 – 2 – No Territory Restrictions
There are no exclusive territories granted to anyone.
SECTION 5 – 3 – Sales Receipts
All Distributors must provide their retail customers with two copies of an official Xervéo sales receipt at the time of the sale. These receipts set forth the Customer Satisfaction Guarantee as well as any consumer protection rights afforded by Federal or State law. Distributors must maintain all retail sales receipts for a period of two years and furnish them to Xervéo at the Company’s request. Records documenting the purchases of Distributors’ Preferred Customers will be maintained by Xervéo.
Remember that customers must receive two copies of the sales receipt. In addition, Distributors must orally inform the buyer of his or her cancellation rights.
SECTION 6 – BONUSES AND COMMISSIONS
SECTION 6 – 1 – Bonus and Commission Qualifications and Accrual
A Distributor must be active and in compliance with the Agreement to qualify for bonuses and commissions under the terms of the Xervéo Financial Freedom Plan™. To be considered “Active” a Distributor must maintain a minimum of $200 in Personal Volume (PV) in any given calendar month period.
So long as a Distributor complies with the terms of the Agreement, Xervéo shall pay commissions to such Distributor in accordance with the Xervéo Financial Freedom Plan. The minimum amount for which Xervéo will issue a commission is $10. If a Distributor’s bonuses and commissions do not equal or exceed $10, the Company will accrue the commissions and bonuses until they total $10. Payment will be issued once $10 has been accrued.
Notwithstanding the foregoing, all commissions, bonuses or other compensation owed a Distributor, regardless of the amount accrued, will be paid at the end of each fiscal year or upon the termination of a Distributor’s Distributor Agreement.
SECTION 6 – 2 – Adjustment to Bonuses and Commissions
SECTION 6 – 2 – 1 – Adjustments for Returned Products
Distributors receive bonuses and commissions based on the actual sales of products to end consumers. When a product is returned to Xervéo for a refund, either of the following may occur at the Company’s discretion:
The bonuses and commissions attributable to the returned or repurchased product will be deducted from payments to the Distributor and upline Distributors who received bonuses or commissions on the sale of the refunded product, in the month in which the refund is given, and continuing every pay period thereafter until the bonuses and commissions are recovered;
The Distributor or upline Distributors who earned bonuses or commissions based on the sale of the returned product will have the corresponding points deducted from their Group Volume in the next month and all subsequent months until such points are completely recovered; or
The bonuses and commissions attributable to the refunded product may be deducted from any refunds or credits to the Distributor who received the bonuses or commissions on the sales of the refunded product.
SECTION 6 – 2 – 2 – Bonus and Commission Checks
The Company pays commissions and bonuses via check. There is a $3.50 processing fee deducted from each check issued to the Distributor.
SECTION 6 – 2 – 3 – Tax Withholdings
If a Distributor fails to submit a valid Tax ID Number, Xervéo will deduct the necessary back-up withholdings from the Distributor’s bonus and commission checks as required by law.
SECTION 6 – 3 – Reports
All information provided by Xervéo in downline activity or downline genealogy reports, including but not limited to Personal and Group Volume (or any part thereof), and downline sponsoring activity is believed to be accurate and reliable. Nevertheless, due to various factors— including but not limited to the inherent possibility of human, digital, and mechanical error; the accuracy, completeness, and timeliness of orders; denial of credit card and electronic check payments; returned products; credit card and electronic check charge-backs—the information is not guaranteed by Xervéo or any persons creating or transmitting the information.
All Personal and Group Volume information is provided “as is” without warranties, express or implied, or representations of any kind whatsoever. In particular, but without limitation, there shall be no warranties of merchantability, fitness for a particular use, or non-infringement.
To the fullest extent permissible under applicable law, Xervéo and/or other persons creating or transmitting the information will in no event be liable to any Distributor or anyone else for any direct, indirect, consequential, incidental, special or punitive damages that arise out of the use of or access to Personal and/or Group Volume information (including but not limited to lost profits, bonuses, or commissions, loss of opportunity, and damages that may result from inaccuracy, incompleteness, inconvenience, delay, or loss of the use of the information), even if Xervéo or other persons creating or transmitting the information shall have been advised of the possibility of such damages.
To the fullest extent permitted by law, Xervéo or other persons creating or transmitting the information shall have no responsibility or liability to you or anyone else under any tort, contract, negligence, strict liability, products liability or other theory with respect to any subject matter of this agreement or terms and conditions related thereto.
Access to and use of Xervéo’s online and telephone reporting services and your reliance upon such information is at your own risk. All such information is provided to you “as is”. If you are dissatisfied with the accuracy or quality of the information, your sole and exclusive remedy is to discontinue use of and access to Xervéo’s online and telephone reporting services and your reliance upon the information.
SECTION 6 – 4 – Xervéo Financial Freedom Plan™
All details regarding Xervéo’s commissions and bonuses are presented in a separate document, Introduction and Detailed Financial Freedom Plan™.
Xervéo reserves the right to amend the Introduction and Detailed Financial Freedom Plan in its sole and absolute discretion. Amendments shall be effective thirty (30) days after publication of notice that the Plan has been modified. Amendments shall not apply retroactively to sales and other Distributor activity that occurred prior to the effective date of the amendment.
SECTION 7 – PRODUCT GUARANTEES, RETURNS AND INVENTORY REPURCHASE
SECTION 7 – 1 – Product Guarantee, Warranty and Rescission
Federal and state law requires that Distributors notify their retail customers that they have three (3) business days (five (5) business days for Alaska residents) within which to cancel their purchase and receive a full refund upon return of the products in substantially as good condition as when they were delivered. Saturday is a business day, Sundays and legal holidays are not business days. Distributors MUST verbally inform their customers of this right; they MUST provide their customers with TWO copies of a retail receipt at the time of the sale; and MUST point out this cancellation right stated on the receipt.
Xervéo offers a money-back guarantee on products returned within five (5) days from the date of receipt, less a 10% restocking fee.
Products shipped directly to the customer by the Company must be returned to the Company and a refund will be issued to the customer by the Company. Products delivered to the customer by a Distributor must be returned to the selling Distributor, and it shall be the responsibility of the Distributor to issue the refund to his/her customer. This product satisfaction guarantee does not apply to products damaged by abuse or misuse, and shipping costs are not refundable.
If a Distributor returns more than $300 for a refund in any 12 consecutive month period, the request will constitute the Distributor’s voluntary cancellation of his or her Distributor Agreement, and the refund will be processed as an inventory repurchase pursuant to Section 7-3, and the Distributor’s Xervéo business will be cancelled
SECTION 7 – 2 – Returns by Retail Customers
A retail customer is a customer who purchases Xervéo products from a Distributor’s inventory, at a home party sponsored by the Distributor, or from the Distributor’s replicated Xervéo website. Xervéo offers, through its Distributors, a five (5) day money-back guarantee to all retail customers. If the product is returned within five (5) days of receipt, the retail customer will be issued a full refund, less a 10% restocking fee. Every Distributor is bound to honor the retail customer guarantee.
If, for any reason, a retail customer is dissatisfied with any Xervéo product, the retail customer may return the unused portion of the product to the Distributor from whom it was purchased, within five (5) days of receipt for a refund of the purchase price (less a 10% restocking fee and shipping costs).
The following provision sets forth the minimum refund permitted by law to a retail customer:
A retail customer who makes a purchase of $25.00 or more has three (3) business days (72 hours, excluding Sundays and legal holidays) after the sale or execution of a contract to cancel the order and receive a full refund consistent with the cancellation notice on the order form or sales receipt (five (5) days for Alaska residents). When a Distributor makes a sale or takes an order from a retail customer who cancels or requests a refund within the 72 hour period, the Distributor must promptly refund the customer’s money as long as the products are returned to the Distributor in substantially as good condition as when received (five (5) days for Alaska residents).
Distributors must orally inform customers of their right to rescind a purchase or an order within 72 hours (five (5) days for Alaska residents), and ensure that the date of the order or purchase is entered on the order form. All retail customers must be provided with two (2) copies of an official Xervéo sales receipt at the time of the sale. The back of the receipt provides the customer with written notice of his or her rights to cancel the sales agreement.
SECTION 7 – 3 – Return of Inventory and Sales Aids by Distributors Upon Cancellation
Upon cancellation of a Distributor’s Agreement, the Distributor may return products and sales aids for a refund. In order to receive a refund from Xervéo pursuant to this policy, the following requirements must be met:
The items being returned must have been personally purchased by the Distributor from Xervéo (purchases from other Distributors or third parties are not subject to refund);
The items must be in Resalable condition (see Definition of “Resalable” below); and
The items must have been purchased from Xervéo within one year prior to the date of cancellation.
Upon receipt of Resalable products and sales aids, the Distributor will be reimbursed 90% of the net cost of the original purchase price(s). Shipping and handling charges incurred by a Distributor when the products or sales aids were purchased, and return shipping fees, will not be refunded.
If the purchases were made through a credit card, the refund will be credited back to the same account. If a Distributor was paid a bonus or commission based on a product(s) that he or she purchased, and such product(s) is subsequently returned for a refund, the bonus and/or commission that was paid to the Distributor based on that product purchase will be deducted from the amount of the refund.
Products and Sales aids shall be deemed “Resalable” if each of the following elements is satisfied:
They are unopened and unused;
Packaging and labeling has not been altered or damaged;
They are in a condition such that it is a commercially reasonable practice within the trade to sell the merchandise at full price; and
They are returned to Xervéo within one year from the date of purchase. Any merchandise that is clearly identified at the time of sale as nonreturnable, discontinued, or as a seasonal item, shall not be Resalable. Virtual Starter Kit fees are not refundable except as provided below.
SECTION 7 – 3 – 1 – Residents of Louisiana, Massachusetts, and Wyoming
Upon the cancellation of the Distributor Agreement and in addition to the refund provisions set forth in Section 7-3, residents of Louisiana, Massachusetts, Puerto Rico, and Wyoming, upon request, will receive a 90% refund of all Virtual Starter Kit fees and renewal fees paid while the Distributor Agreement was in force.
SECTION 7 – 3 – 2 – Montana Residents
A Montana resident who cancels his or her Distributor Agreement within 15 days from the date of enrollment will receive a full refund of the Virtual Starter Kit fee.
SECTION 7 – 4 – Procedures for All Returns
The following procedures apply to all returns for refund, repurchase, or exchange:
All merchandise must be returned by the Distributor or customer who purchased it directly from Xervéo.
All products to be returned must have a Return Authorization Number which is obtained by calling the Distributor Services Department. This Return Authorization Number must be written on each carton returned.
The return is accompanied by the original packing slip, a completed and signed Product Return Form, and the unused portion of the product in its original container.
Proper shipping carton(s) and packing materials are to be used in packaging the product(s) being returned for replacement, and the best and most economical means of shipping is suggested. All returns must be shipped to Xervéo shipping pre-paid. Xervéo does not accept shipping-collect packages. The risk of loss in shipping for returned product shall be on the Distributor. If returned product is not received by the Company’s Distribution Center, it is the responsibility of the Distributor to trace the shipment.
If a Distributor is returning merchandise to Xervéo that was returned to him or her by a personal retail customer, the product must be received by Xervéo within ten (10) days from the date on which the retail customer returned the merchandise to the Distributor, and must be accompanied by the sales receipt the Distributor gave to the customer at the time of the sale.
No refund or replacement of product will be made if the conditions of these rules are not met.
SECTION 8 – DISPUTE RESOLUTION AND DISCIPLINARY PROCEEDINGS
SECTION 8 – 1 – Disciplinary Sanctions
Violation of the Agreement, these Policies and Procedures, violation of any common law duty, including but not limited to any applicable duty of loyalty; any illegal, fraudulent, deceptive or unethical business conduct; or any act or omission by a Distributor that, in the sole discretion of the Company may damage its reputation or goodwill (such damaging act or omission need not be related to the Distributor’s Xervéo business), may result, at Xervéo’s discretion, in one or more of the following corrective measures:
Issuance of a written warning or admonition;
Requiring the Distributor to take immediate corrective measures;
Imposition of a fine, which may be withheld from bonus and commission checks;
Loss of rights to one or more bonus and commission checks;
Xervéo may withhold from a Distributor all or part of the Distributor’s bonuses and commissions during the period that Xervéo is investigating any conduct allegedly violative of the Agreement. If a Distributor’s business is canceled for disciplinary reasons, the Distributor will not be entitled to recover any commissions withheld during the investigation period;
Suspension of the individual’s Distributor Agreement for one or more pay periods;
Permanent or temporary loss of, or reduction in, the current and/or lifetime rank of a Distributor (which may subsequently be re-earned by the Distributor);
Transfer or removal of some or all of a Distributor’s downline Distributors from the offending Distributor’s Marketing Organization;
Involuntary termination of the offender’s Distributor Agreement;
Suspension and/or termination of the offending Distributor’s Xervéo website or website access; or
Any other measure expressly allowed within any provision of the Agreement or which Xervéo deems practicable to implement and appropriate to equitably resolve injuries caused partially or exclusively by the Distributor’s policy violation or contractual breach.
In situations deemed appropriate by Xervéo, the Company may institute legal proceedings for monetary and/or equitable relief.
SECTION 8 – 2 – Grievances and Complaints
When a Distributor has a grievance or complaint with another Distributor regarding any practice or conduct in relationship to their respective Xervéo businesses, the complaining Distributor should first report the problem to his or her Sponsor who should review the matter and try to resolve it with the other party’s upline sponsor. If the matter involves interpretation or violation of Company policy, it must be reported in writing to the Distributor Services Department at the Company. The Distributor Services Department will review the facts and attempt to resolve it.
SECTION 8 – 3 – Governing Law, Jurisdiction and Venue
The Agreement will be governed by and construed in accordance with the laws of the State of Utah without regard to principles of conflicts of laws. In the event of a dispute between a Distributor and Xervéo arising from or relating to the Agreement, or the rights and obligations of either party, the parties consent to exclusive jurisdiction and venue before the U.S. District Court for the District of Utah, or state court residing in Davis County or Salt Lake County, State of Utah.
SECTION 8 – 3 – 1 – Louisiana Residents
Notwithstanding the foregoing, residents of the State of Louisiana shall be entitled to bring an action against Xervéo in their home forum and pursuant to Louisiana law.
SECTION 9 – PAYMENT
SECTION 9 – 1 – Returned Checks
All checks returned by a Distributor’s bank for insufficient funds will be re-submitted for payment. A $25.00 returned check fee will be charged to the account of the Distributor. After receiving a returned check from a customer or a Distributor, all future orders must be paid by credit card, money order or cashier’s check. Any outstanding balance owed to Xervéo by a Distributor for non-sufficient funds checks and returned check fees will be withheld from subsequent bonus and commission checks.
SECTION 9 – 2 – Credit Card Chargebacks
Distributors agree that if they initiate a chargeback for any product purchased from the Company without first contacting the Company to request a refund, the Company may take disciplinary action as provided in Section 8-1. Such action may include the involuntary termination of the Distributor’s Distributor Agreement.
SECTION 9 – 3 – Restrictions on Third Party Use of Credit Cards and Checking Account Access
A Distributor shall not permit other Distributors or customers to use his or her credit card, or permit debits to his or her checking accounts, to enroll or to make purchases from the Company.
SECTION 9 – 4 – Sales Taxes
Xervéo is required to charge sales taxes on all purchases made by Distributors and Preferred Customers, and remit the taxes charged to the respective states. Accordingly, Xervéo will collect and remit sales taxes on behalf of Distributors, based on the suggested retail price of the products, according to applicable tax rates in the State or Province to which the shipment is destined. If a Distributor has submitted, and Xervéo has accepted, a current Sales Tax Exemption Certificate and Sales Tax Registration License, sales taxes will not be added to the invoice and the responsibility of collecting and remitting sales taxes to the appropriate authorities shall be on the Distributor.
Exemption from the payment of sales tax is applicable only to orders which are shipped to a state for which the proper tax exemption papers have been filed and accepted. Applicable sales taxes will be charged on orders that are drop-shipped to another state. Any sales tax exemption accepted by Xervéo is not retroactive.
SECTION 10 – INACTIVITY, RECLASSIFICATION, AND CANCELLATION
SECTION 10 – 1 – Effect of Cancellation
So long as a Distributor remains active and complies with the terms of the Distributor Agreement and these Policies and Procedures, Xervéo shall pay commissions to such Distributor in accordance with the Compensation Plan. A Distributor’s bonuses and commissions constitute the entire consideration for the Distributor’s efforts in generating sales and all activities related to generating sales (including building a Marketing Organization).
Following a Distributor’s non-renewal of his or her Distributor Agreement, cancellation for inactivity, or voluntary or involuntary cancellation of his or her Distributor Agreement (all of these methods are collectively referred to as “cancellation”), the former Distributor shall have no right, title, claim or interest to the Marketing Organization which he or she operated, or any commission or bonus from the sales generated by the organization.
A Distributor whose business is cancelled will lose all rights as a Distributor. This includes the right to sell Xervéo products and services and the right to receive future commissions, bonuses, or other income resulting from the sales and other activities of the Distributor’s former Marketing Organization. In the event of cancellation, Distributors agree to waive all rights they may have, including but not limited to property rights, to their former Marketing Organization and to any bonuses, commissions or other remuneration derived from the sales and other activities of his or her former Marketing Organization.
Following a Distributor’s cancellation of his or her Distributor Agreement, the former Distributor shall not represent himself or herself out as a Xervéo Distributor and shall not have the right to sell Xervéo products or services. A Distributor whose Distributor Agreement is canceled shall receive commissions and bonuses only for the last full pay period he or she was active prior to cancellation (less any amounts withheld during an investigation preceding an involuntary cancellation).
SECTION 10 – 2 – Cancellation Due to Inactivity
SECTION 10 – 2 – 1 – Failure to Meet PV Quota
If a Distributor fails to personally generate at least $150 PV per month for two (2) consecutive months, his or her Distributor Agreement shall be canceled for inactivity.
SECTION 10 – 2 – 2 – Failure to Earn Commissions or Bonuses
If a Distributor has not earned a bonus or commission for six consecutive months, his or her Distributor Agreement shall be canceled for inactivity.
SECTION 10 – 2 – 3 – Reclassification Following Cancellation Due to Inactivity
If a Distributor’s Agreement is cancelled due to inactivity and he or she is on the Company’s Distributor Autoship program, the Autoship Agreement shall remain in force and the former Distributor shall be reclassified as a Preferred Customer. If the cancelled Distributor was not on the Autoship program, he or she will be entitled to continue purchasing products directly from the company at the discounted Preferred Customer prices.
SECTION 10 – 3 – Involuntary Cancellation
A Distributor’s violation of any of the terms of the Agreement, including any amendments that may be made by Xervéo in its sole discretion, may result in any of the sanctions listed in Section 8-1, including the involuntary cancellation of his or her Distributor Agreement. Cancellation shall be effective on the date on which written notice is mailed, emailed, faxed, or delivered to an express courier, to the Distributor’s last known address, email address, or fax number, or to his or her attorney, or when the Distributor receives actual notice of cancellation, whichever occurs first.
Xervéo reserves the right to terminate all Distributor Agreements upon thirty (30) days written notice in the event that it elects to:
Cease business operations;
Dissolve as a corporate entity; or
Terminate distribution of its products via direct selling.
SECTION 10 – 4 – Voluntary Cancellation
A participant in this network marketing plan has a right to cancel at any time, regardless of reason. Cancellation must be submitted in writing to the Company at its principal business address. The written notice must include the Distributor’s signature, printed name, address, and Distributor I.D. Number.
In addition to written cancellation, Distributors who have consented to Electronic Contracting will cancel their Distributor Agreement should they withdraw their consent to contract electronically.
If a Distributor is on the Company’s Distributor Autoship program, the Distributor’s Autoship Agreement shall continue in force and the former Distributor shall be reclassified as a Preferred Customer, unless the Distributor also specifically requests that his or her Autoship Agreement also be canceled.
SECTION 10 – 5 – Non-renewal
A Distributor may voluntarily cancel his or her Distributor Agreement by failing to renew the Agreement on its anniversary date or by failing to pay his/her monthly website fee. The Company may also elect not to renew a Distributor’s Agreement upon its anniversary date.
SECTION 10 – 6 – Exceptions to Activity Requirements
SECTION 10 – 6 – 1 – Maternity
A Distributor shall be exempt from meeting her or his Personal Volume and Group Volume requirements for a period of four (4) months following the birth or adoption of a child. Appropriate documentation must be provided to the Company upon request.
SECTION 10 – 6 – 2 – Military Deployment.
Military personnel shall be exempt from meeting their Personal Volume and Group Volume requirements while deployed into a foreign country and for a period of one (1) month following the end of such deployment. Appropriate documentation must be provided to the Company upon request.
SECTION 11 – DEFINITIONS
Active Preferred Customer: A Preferred Customer whose account with Xervéo has been paid for the most recent period. (See the additional definition of “Preferred Customer” below).
Active Distributor: A Distributor who satisfies the minimum Personal Sales Volume requirements, as set forth in the Xervéo Compensation Plan, to ensure that he or she is eligible to receive bonuses and commissions.
Active Rank: The term “active rank” refers to the current rank of a Distributor, as determined by the Xervéo Compensation Plan, for any pay period. To be considered “active” relative to a particular rank, a Distributor must meet the criteria set forth in the Xervéo Compensation Plan for his or her respective rank. (See the definition of “Rank” below.)
Affiliated Party: A shareholder, member, partner, manager, trustee, or other parties with any ownership interest in, or management responsibilities for, a Business Entity.
Agreement: The contract between the Company and each Distributor includes the Distributor Application and Agreement, the Xervéo Policies and Procedures, the Xervéo Compensation Plan, and the Business Entity Registration Form (where appropriate), all in their current form and as amended by Xervéo in its sole discretion. These documents are collectively referred to as the “Agreement.”
Business Entity: A corporation, partnership, trust, limited liability company, or other type of entity.
Business Entity Registration Form: A supplemental form that all Business Entities must submit with the Distributor Agreement when enrolling as a Xervéo Distributor.
Cancel: The termination of a Distributor’s business. Cancellation may be either voluntary, involuntary, through non-renewal or inactivity.
Customer: As used herein, the term “customer” refers collectively to Preferred Customers and Retail Customers. (See the definitions of “Preferred Customer” and “Retail Customer” below).
Downline Leg: Each one of the individuals enrolled immediately underneath you and their respective Marketing Organizations represents one ‘downline leg’ or ‘leg’ in your Marketing Organization.
Group Volume: The commissionable value of Xervéo products sold by a Distributor’s Marketing Organization. Group Volume does not include the Personal Volume of the subject Distributor. (Virtual Starter Kits and sales aids have no Sales Volume.)
Household: All individuals who are living at or doing business at the same address, and who are related by blood or marriage, or who are living together as a family unit or in a family-like setting. A household includes, but is not limited to, spouses, heads-of-household, and dependent family members residing in the same residence.
Immediate Household: Spouses, heads-of-household, and dependent family members residing in the same residence.
Level: The layers of downline Preferred Customers and Distributors in a particular Distributor’s Marketing Organization. This term refers to the relationship of a Distributor relative to a particular upline Distributor, determined by the number of Distributors between them who are related by sponsorship. For example, if A sponsors B, who sponsors C, who sponsors D, who sponsors E, then E is on A’s fourth level.
Marketing Organization: The Preferred Customers and Distributors sponsored below a particular Distributor.
Official Xervéo Material: Literature, audio or video tapes, websites, and other materials developed, printed, published and/or distributed by Xervéo to Distributors.
Paid-As Rank: The term “Paid-As Rank” refers to the current rank of a Distributor, as determined by the Xervéo Compensation Plan, for any pay period. (See the definition of “Rank” below.)
Personal Production: Moving Xervéo products to end consumers for actual use.
Personal Volume (PV): The commissionable value of products purchased by:
A Distributor; and
The Distributor’s personal customers who are on the Autoship program (Preferred Customers) or who purchase from the Distributor’s Xervéo replicated website.
Preferred Customer: A customer who agrees to a minimum automatic monthly shipment of Xervéo products. Preferred Customers do not enroll Xervéo Distributors and do not participate in the Xervéo Compensation Plan.
Rank: The “Title” that a Distributor holds pursuant to the Xervéo Compensation Plan. “Title Rank” refers to the highest rank a Distributor has achieved in the Xervéo compensation plan at any time. “Paid-As Rank” refers to the rank at which a Distributor is qualified to earn commissions and bonuses during the current pay period.
Recruit: For purposes of Xervéo’s Conflict of Interest Policy (Section 3-11), the term “Recruit” means the actual or attempted sponsorship, solicitation, enrollment, encouragement, or effort to influence in any other way, either directly, indirectly, or through a third party, another Xervéo Distributor or Preferred Customer to enroll or participate in another multilevel marketing, network marketing or direct sales opportunity.
Replicated Website: A website provided by Xervéo to Distributors which utilizes website templates developed by Xervéo. The cost of the Replicated Website is included in the Virtual Starter Kit purchase.
Resalable: Products and Sales aids shall be deemed “Resalable” if each of the following elements is satisfied:
They are unopened and unused;
Packaging and labeling has not been altered or damaged;
They are in a condition such that it is a commercially reasonable practice within the trade to sell the merchandise at full price; and
They are returned to Xervéo within one year from the date of purchase. Any merchandise that is clearly identified at the time of sale as nonreturnable, discontinued, or as a seasonal item, shall not be Resalable.
Retail Customer: An individual or entity that purchases Xervéo products from a Distributor, but who is not a Distributor, or an immediate household family member of a Distributor.
Retail Sales: Sales to a Retail Customer.
Roll-Up: The method by which a vacancy in a Marketing Organization left by a Distributor whose Distributor Agreement has been canceled is filled.
Social Media: Any type of online media that invites, expedites or permits conversation, comment, rating, and/or user generated content, as opposed to traditional media, which delivers content but does not allow readers/viewers/listeners to participate in the creation or development of content, or the comment or response to content. Examples of Social Media include, but are not limited to, blogs, chat rooms, Facebook, MySpace, Instagram, Twitter, LinkedIn, Pinterest, Delicious, and YouTube.
Sponsor: A Distributor under whom an enroller places a new Distributor or Preferred Customer, and is listed as the sponsor on the Distributor or Preferred Customer Application and Agreement.
Upline: This term refers to the Distributor or Distributors above a particular Distributor in a sponsorship line up to the Company. Conversely stated, it is the line of sponsors that links any particular Distributor to the Company.
Virtual Starter Kit: A selection of Xervéo training materials and business support literature, and Distributor replicated website that each new Distributor is required to purchase.