01 Becoming a DistributorSunting
1.1 This Agreement applies to all Distributors of the Company_ All Distributors are bound by the terms and conditions appearing in aU the Company documents Which cumulatively shall be called the 'Terms and Conditions·. They encompass and apply to all the terms and conditions contained in the Distributor's Application and Agreement, Business Manual, Business Plan, International Distribution and Sponsorship Agreement, Preliminary Application and Agreement For Distributor Application and Agreement and any other agreements thai may arise and as modified from time to lime. The terms of each of those documents are incorporated by reference into this Agreement and the terms of this Agreement are incorpomted by reference into the said agreements. The Distributor must comply fully wiltl all terms of lt1is Agreement.
1.2 Melilea (M) Sdn. Bhd. (hereinafter referred to as the Company) are companies incorporated in their respe<:tive companies under the laws of the respective countries. To be an authorised Distribl)\or of the Company, the applicant shall subm" to the Company a duly completed and signed copy of the Company Distributor's Application and Agreement form for the respective country together with the stipulated payment for an official BUSiness Manual. A Distributor agreement must be filed in the country of residence, and if required, a Distributor must provide proof of residency and distributorship. An incomplete agreement or one with false and inaccurate information or agreement for the wrong country will be considered invalid. Changes of information must be informed to the Company immediately. The Distributor must thereafter provide the Company with their bank account number and branch which must be either the Malayan Banking Berflad. Hong Leong Bank Berflad or Public Bank Berhad. The Company will not issue any bonuses should the Distributor fail to do so. No other purchases are necessary.
1.3 The Company reserves the right at its sole discretion to accept or reject any application for distributorship without having to provide reasons for acceptance or rejection. Accepted applicants will be issued with a Distributor Authority Card.
1.4 No one who has had a bankruptcy petition presented on him or is a bankrupt or who is under the age of eighteen (18) Shall be accepted as a Distributor.
1.5 The Company only accepts Official Distributor's Application and Agreement for distributorships in the name of individuals. Applications in the names of COfPOrations or partnerships will not be accepted unless expressly authorised in writing by tt1e Company but will not be permitted in any event if" has as its proprietors, partners, shareholders or directors, a persoo who is already a Distribl)\or w"h the Company.
1.6 A husband and wife team shall apply col1ectively as one Distributor, If both husband and wife are Distributors prior to marriage. they can decide which distributorship to retain. or operate both the distributorships, each of which will be maintained in its original line of sponsorship, provided that their individual distributorship has not lapsed or been terminated, The restriction of obtaining separate distributorship by married couples as set out above shall not apply to the lawful second, third or fourth wives of tile Distributor.
1.7 The duration of distributorship is for a period of 12 months as stated in the authority card. The Agreement may be renewed annually for a period of 12 months. Renewal is not automatic and must be made not later than three (3) months before the expiry of the term. The Company is entitled in ~s absolute discretion to refuse to renew any such renewal. No renewal fee shall be charged. In tt1e event of nOn-reJ'lewal, the distributorship is deemed to be automatically terminated at the expiry of the term of distributorship. The Distributor shall not then deal with the Company's products in any manner whatsoever.
1.8 A person is not entitled to holcl more than one (1) distributorship in the Company at anyone time rlOf have Of own any financial Of benefICial interest (directly Of indirectly) in \he distribtrtOl'Ship of another in the Company.
1.9 A person registered as a Distributor becomes an independent Contractorl businessman and is not and neither can represent tlimself as an employee. partner, agent. franchisee, joint venturer or legal representative of the Company.
1.10 In order for the Company to provide support for the distributorship and in the promotion of the Company name. the DistributOf authorises the Company to transfer and disclose confid8l1tial and/or personal Infonnation in connection with the Distributor and his distributorship to all the Company's group and affiliated companies, the Company's Distributors, the Company Lifestyle Magazine and mass media. The Distributor authorises the Company to disclose Information, even of a confidential nature relating to the Distributor and his distributorMlip to government agencies Of regulatory bodies upon their request or if required by law. This right shall COI1tinue after termination of the distributorship. All such copyright shall belong to the Company which shall have the right to publish the same free of hlndrtlnce or obstructioo from the Distributor.
02 General Guidelines for Distributors Sunting
2.1 The retail prices of all the Company products are fixed and no DistribUtor shall uooercharge or overchargEI customers.
2.2 Price undercutting. price overcharging andlor double sponsoring of Distributors shall not be allowed and can cause the termination of the Distributor. The Company shall investigate upon receipt of such written complaints. In the event that a oomplaint Is found to be true the following further courses of action may be taken:
2.2.1 The Distributor who signs up other Distributors or spouses of other groops may have hislMr distributorship terminated or helsne may be given a starn and final warning.
2.2.2 All Distributors invofiied shall be I1ansfen'ed back to their original sponsorsI1ines.
2.2.3 All bonuses. incentives or benefrts previously paid to the wrongful Distributor will not be repaid to the rightful Distributor.
2.2.4 The offender shall sign a good condllCt declaration should a warning be given. The decision of the Company management oommittee on undercutting. overcharging andlor double sponsoring shall be final.
2.3 Purchase of goods from the Company or its authorised Inner and Outer Beauty Centers/service centers shall be 00 a cash or credit card basis. All purchases must be COO'ectly recorded in the Distributor Sales Invoice upon purchase and a copy is to be retained by the Distributor.
2.4 No manipulation of Distributor Sales tnvoice is permitted (eg. purchase stock for downline Distributors but record it under own personal sales).
2.5 All the Company Distributors must strictly adhere to and practise all requirements under the Direct Sales Act 1993. and shall solely bear all consequences for any matter arising from fIOO-<lOIllpliance.
2.6 A Distributor shall not have simultaneous interest. whether directly or indirectly or be involved in any activ~ies of any other Direct Selling company or non·Direct Selling company thai sells similar or competing products. A Distributor is deemed 10 be directly or indirectly involved in the activities of any other Direct Selling or a non·Direct Selling company if he aOOlor his spouse is/are;
2.6.1 Employees, proprietors, partners. shareholders or directors of another Direct Selting or a non-Direct Selling company selling similar or competing prodI.Icts; or
2.6.2 Distributors of another Direct Selling or a non-Direct Selling company; or
2.6.3 Are involved in selling. distributing or promoting products or recruiting Distributors for another Direct Selling or non-Direct Selling company selling similar or competing products either as a member or non-member of the ottler company or inducing Distributors of the Company to attend or join the other company. A bfeach of ttlis provision is COf1sidered a serious breach and will resutt in termination of the di$lfibutorship.
2.7 A Distributor must not make use of or carry out any activities in any of the Company's functions, seminars, meetings, program$, offices, distribution centers. Inner and Outer Beauty Centers or service centers to promote or sell his own products or the products of another company or person.
2.8 The Distributor shall not declare. imply or represent thai he is an employee and/or has any employment relationship with the Company.
2.9 The Distributor shall have no authority or power to bind the Company or make an agreement in the name of and create a liability against the Company in any way or for any purpose.
2.10 A Distributor may only conduct business in a coun\ly which has been officially approved and officially opened for business by the Company. A Distributor residing in one country can market product!; and only recruit new Distributors residing in the $lime country, There are no territorial limits within an approved country, A Distributor should not declare or represent to anyone that he/she has exdusive distributorship or fral'lchise rights for any territory.
2.11 A Distributor shall present the Company's products and Business Plan to potential customers or Distributors in an honest and !ruthful manner and shall not make any false or misleading representations in hislher enthusia$rTI to sell the Company's products and on no account whatsoever shall the Distributor use racial. political. religious or other sensitive issues to sell the Company's products. A Distributor shall not use eKtemal literature in connection with the Company. Any liability arising from non-compliance thereof will not be the responsibility of the Company.
2.12 A Di$tributor must demon$lfate and explain dearly to the cU$tomer and his downline the proper usage and effects of the Company's products and shall nol on any account whatsoever make any false or misleading statements regarding the description. usage and efficacy of the products. In the lIVent the Di$tributor makes any false or misleading statements. the Distributor shall be liable to indemnify and keep the Company indemnified against any losses or damages suffered by the Company.
2.13 A Distributor shall not provide any gifts, discount vouchers or other promotional ginvnich in the sales 01 the Company's products other than those approved by the Company.
2.1. A Distributor shall not on any account or under any guise whatsoever sell, distribute or enter into any agreement to sell or distribute the Company products under the name of another Distributor whether or not the other Distributor consents to such sale or distribution under his name. A Distributor shall not entice or make any arrangement with his downline or the downline of another Distributor whereby the sales of his downline or the down line of the other Distributor is passed off as sates 01 the Distributor.
2.15 A Distributor may not, either when a Distributor with the Company or not, induce any other Distributors to leave the Company or join another company as described in clause 2.6 above. This includes but is not limited to causing one Distributor to terminate his agreement w~h one sponsor and then taking up distributorship with another sponsor. The Company reserves the right to terminate the distributorship without requesting the Distributor \0 show cause and in add~ion may claim damages from a Distributor that causes such inducement.
2.16 A Distributor shall not use the Company networllio promote the sale or use of any products, programs or services olhBf than those offered through the Company network.
2.17 A Distributor shall not sell or distribute any of the Company's products where the shelf life of the products has e)lpired.
2.18 A Distributor shall not purchase the Company's products from one country and thereafter resell the said products in a different country. This applies whether or not the product is in the product list of the Company in the country concemed and whether or not the Distributor makes a profit from the sale. This clause applies to all related companies of the Company.
2.19 A Distributor shall not, whether orally or in writing, state negative facts about the Company, ~s shareholders. directors, officers, agents, products or engage in unethicat conduct prejudk:ialto the interest. image or reputation of the Company and its products. This prohibition appties even after his Distributorship with the Company has ended.
2.20 The Distributor shall at all times work diligently to protect and promote the interests of the Company and to assist and co-operate with the Company to maintain price stability of the products in the market and to act loyally and faithfuly toward the ~y in all malter5.
2.21 The Distributor shall not at any time during or after the term of his distributor5hip, divulge. communicate or allow to be divulged to any per5on. firm or Company. the use or e)lploitalion for any purpose whatever any of the trade secrets, confidential information, knowledge, financial or trading information relating to the Products, Business Affairs or method of carrying on business which the Distributor may receive or obtain as a resuH of entering into this Agreement other than to persons who have signed with the Company in a similar capacity.
2.22 The restriction contained in Clause 2.21 hereof shall continue to apply after the e)lpiration or sooner termination of this Agreement withoot limrt in point of time but shall cease to apply to information or knowledge. which may property come into the public domain through no fau~ of the Distributor.
2.23 Not to permit any person to act or assist in the Business unm such person has sigr.ed a leiter of undertaking pertaining to matters mentioned in Clause 2.21 above. Co rpo rat e / Part n ersh i p / Fi rill Distributorships
03 Corporate/Partnership/firm DistributorshipSunting
3.1 Applications in the forms of Corporate, Partnership or Firm names will fIOt be accepted unless e)lpressiy authorised in writing by the Company. In the case of e corporation. stich approval. whether provided in writing in the approval form or fIOt, will alWays be conditional upon tile Directors and shareholders of Ihe company being personally liable to the Company in the event of any daim, by way of legal suit or otherwise, by the Company against them. This personal liability applies even though the said Directors and shareholders have not provided any written undertaking or personal guarantee. For this purpose, previous aod present Directors and shareholders of \he company shall be liable in so far as Ihey held such positions as at the date of Ihe commission of the wrongful act. A personal guarantee is required from the directors of the company, without which the dislribulonohip agreement may be voidable at the di$Cfetion of the Company.
3.2 If approved, the application forms must be signed by an authorised officer of the corporation or as required by the company's articles of association. or in the case of a partnership. all penners of the firm.
3.3 In the event that any director, shareholder, partner or sole proprietor bfeaches any terms and conditions, the breach will also be deemed to be that 01 the company, partnership or firm.8Qth the individual Distributor's distributorship and the distributorship of the company. partnership or firm to which he beloogs to will be terminated.
04 Termination, Resignation & Suspension of Distributorship Sunting
4.1 The terms 01 this Agreement creates a purely contractual relationship between the Company and the Distributor and under no circumstances creates any quasi-contractual relationship nor any equity in the Company. The contract may be terminated by either the Company or the Distributor. The use of the words 'termination' or 'resignation' by the Company or the Distributor indicate the same meaning and carry the same consequences as stated in this agreement. Any letters of resignation of the distributOfShip by the Distributor will be deemed to be a letter of termination 01 the distributorship.
4.2 The Company reserves the right to suspend, demote or transfer the entire downline or part thereof to soother group and terminate the distributorship of any individual and in all cases may do so without any compensation and without assigning any reason and may withold the rights. privileges. bonuses. positions. benefits. commission. monies or incentives or take any action deemed appropriate in the event a Distributor bfeaches any of the terms and conditions contained in the Distributor's Apptication and Agreement. Business Manual, Business Plan, International Distribution and Sponsor Agreement, Preliminary Application and Agreement, the Direct Sales Act 1993 and any other Agreement that may arise and as modified from lime to time. Any termination or action taken shall be final and not challengeable in any court of law. The Company reserves the right to terminate without requesting the Distributor to show cause and in addition may daim damages from a Distributor.
4.3 A Distributor may terminate his distributorship with the Company at any time.
4.4 Where the spouse 01 the Distributor does or carries out any act which would result in a breach of any law or regulation governing direct sales or would result in a breach 01 any provisions in this Agreement which would entitle the Company to suspend. demote or terminate the appointment 01 the Distributor. then the actions 01 the spouse shall be deemed to be the actions of the Distributor and all rights and remedies that the Company may have against the Distributor under the terms and cond~ions, in law or equity shall be enlorceable against the Distributor as if the actions of the Distributor's spouse were that of the Distributor.
4.5 In the following cases Clause 4.2 above will slrictly appty;
4.5.1 If the Distributor fails to pay any amount due under this Agreement on the due date or on demand if so payable.
4.5.2 If the Distributor commits an act of bankruptcy or being a firm, if any member of the firm commits an act of bankruptcy or being a Company. a petition for ',yjnding up is prese: :ted (exoepI YOU:':tao:y iquidaliot: b' the ptJ pc se of reconstrucIion). 4.5.3 If the Distributor enters into any composition or arrangement with or for the benefit of the creditors of the distributor or allow any judgment against the Distributor to remaill unsatisfied within fourteen (14) days thereof or has allY distress. execution or other process of a Court of competellt jurisdiction levied upon or issued against any property of the Distributor and such distress, execution or other process as the case may be is not satisfied by the Distributor within seven (7) days from the date thereof.
4.5.4 If the Distributor engages in any COJ'Iduct which in the opinion of the Company is prejudicial to the Company's interest or busirtess.
4.5.5 11 a Receiver and/or Manager is appointed to receive and/or manage \tie assets. undertakings or properties of the Distributor or any part thereof.
4.5.6 If the Distributor shatl become mentally ill or is unable or prevented through any cause or reason from carryiflg out his duties as herein provided for any period exceeding four (4) weeks.
4.5.7 If the Distributor shall be convicted 01 any criminal offence and sentenced to a teon of imprisonment e~ceeding three (3) months or a fine e~ceeding RM500.00 or both.
4.5.6 If the Distributor fails to qualify for Performance Bonus for a period of three (3) consecutive months during his term 01 appointment.
4.5.9 If the conduct and actions of the DisIriWor adversely affects or is likety to adversely affect the interests. image and reputation of the Company and ~s product.
4.5.10 If in the opinioo of the Company, the Distributor is not a fit or proper person to hold a distributorship.
4.5.11 II the Distributor's application form was found to contain statements. information or declarations which were false. misleading or inaccurate.
4.6 In any event and without prejudice to this Agreement. the Company reserves the right to immediately terminate the Distributor as the CompallY deems fit. This will be necessary if in the Company's sole opinion the damage caused by the distributor's action is serious and has caused or is causing the Company extensive damage.
4.7 Ally termination or prior determination of this Agreement shall be without prejudice to any claim or right of action the Company may have against the Distributor in resped of any antecedent breach of the terms and conditions herein COlltained.
4.8 Upon termination or resignation of the Distributor either by the Company or by the Distributor, he will not be allowed to use any information whether of a confidential nature or not, pertaining to the Company. The Distributor cannot use any of the Company's company records, Distributor list or other information for any other purpose whatsoever. The Distributor may atso not induce any Distributor from the Company into leaving the Company or be involved in other direct selling or non-direct selling companies. The distributor herein understands and agrees that any such conduct will render the Distributor liable to termination 01 his distributorship and also damages against the Company.
4.9 In the event that the Company terminates a Distributor or a Distributor terminates or resigns from his distributorship, his individual distributorship and all other distributorships in which he has a pecuniary interest will simouHa!'leOusly be terminated.
4.10 A Distributor whose agreement expires can apply to rejoin as a new Distributor. 4.11 A Distributor who resigns may reapply to rejoin as a Distributor after 3 months of inactivity from the date of resignation. Inactivity means non-involvement in any of the Company's direct or indirect business or conduct.
05 Termination and Suspension Consequences Sunting
5.1 Upon the termination of this Agreement either by effluxion of time, notice, breach or otherwise:·
5.1.1 The Distributor shalilorthwith surrender his Authority Card to the Company and shall not conduct, sell or distribute or otherwise deal with the Company's products in any manner and Oil any account whatsoever. 5.1.2 All unfulfilled orders for the Products to the Distributor shall automatically be deemed to be cancelled: 5.1.3 All ~ts granted by the Company to the Distributor shaD irlYnediatety be relinquished: 5.1.4 The Distributor shall immediately settle all debts due to the Company;
5.1.5 The Distributor shall forthwith cease carrying on the Business.
5.1.6 The Distributor shall not be entitled to any daims for rights, privileges, bonuses, positioos, benefits, commission, monies or incentives which may or would Ilave been accrued to the Distributor from the time of the misconduct till the period of teffilination and thereafter, whether by the Distributor or by the Company. This is without prejudice to any right of legal action the Company may have against the Distributor. In the event the benefit is accumulated and is to be paid only on year end. the Distributor will also not be entiUed to such benefit for the year in which the misconduct is established.
5.1.7 In the event of suspension, any bonus, commission, incentive, money or other benefits accrued to the Distributor during the term of suspension will not be payable. The same will not be payable in the event of the suspension being uplifted.
5.2 In the event that a Distributor has been terminated. his downline Distributors (if any) shall be transferred upwards to his immediate upline or any upline as the Company deems fit, subject always that the Company shall be entitled to withold or suspend the transfer of the Distributor's down line to his upline until such time as the Company deems frt. No recalculation of bonus during the transition period will be allowed. In the event that any such termination is found to be invalid for any reason, the Company reserves the right to reverse the above transfer and all such Distributors benefiting from the said earlier transfer are required to relinquish any benefits obtained.
06 Transfrering of Distributionship Sunting
6.1 If the Distributor dies. the legal spouse or any nominated beneficiary shall be entitled at hislher option to continue the distributorship, unless IlOtice to the contrary is received and acknowledged to be received by the Company in writing. Whera the legal spouse shall predecease or die simultaneously with the Distributor or fail to survive the Distributor for a period of one (1) month from the Distributor's death. the benefits enjoyed by the Distributor (other than the rank) shall pass to the person nominated as the beneficiary. If no such beneficiaries are named or nominated by the Distributor, all the rights, privileges. bonus, commission, incentive, money or other benefits of the Distributor shall cease upon the death or insanity of the Distributor.
6.2 In the event of a divorce in the case of a joint distributorship. unless the parties shall have both agreed on the mode of sharing the bonus. commission. incentive. money or other benefits. the same shall be distributed equally. 07 08 6.3 A Distributor may not transfer or assign any rights or liabil~ies in !he distributorship agreement to any other party without the prior written approval of the Company. An application must be made in writing to the Company which must be duly signed by both the transferor, transferee and affirmed before a commisioner for oaths. In any event, the Distributor tllat transfers will still be responsible for ensuring compliance with the agreement and will be jointly and severally liable for any liability arising from breaches thereof. 6.4 No change in the status of dislriblitOrship is allowed from an individual distributorship to a different entity such as a firm, partnership or company and vice-versa Of from one such entity to a similar entity with II different name unless with the prior approval of the Company which must be submitted in writing in accordance with the above paragraphs together wrth the re~vant approvals from the Distributor, sole proprietor, partners and directors of both the transferror and the transferee, 7.1 The Company does not allow the Distributor to sell his distributorship unless with the prior approval in writing by the President of the Company. 8.1 A Distributor shall wherever possible attend all training courses organised or conducted by the Company. The Company shall cooduct training at the Company's premises on the produ<:ts and Business Plan of the Company at no charge. However. the Company is entitled to impose a fee on other courses organised or cooducted by the Company from time to time fOf self development. 8.2 All Distribtltors are automatically subscribed to the Company Lifestyle Magazine to further their product knowledge and be informed of activ~ies of the Company and the network business. A subscription fees as determined by the Company will be levied for this magazine which is payable through the Automatic Subscliption Service whereby the Company is authorized to dedu<:t the subscription directly from the Distributor's bonus, This deduction is not refundable. 8.3 A Distributor must obtain prior approval from the Company in order to conduct any courses or seminar. A violation of this rule may cause the distributorship to be terminated, 09 9.1 A Distributor may sponsor any person who satisfies the requirements stipulated in Ihe Terms and Conditions to be a Distributor. Howevl!f, where the person being sponsored is a non-dtizen, Ihe Distributor must ensure that Ihe said person has Ihe necessary documents from the relevant authorities to slay and conduct business in Malaysia. Upon sponsoring, the Distributor must immediately submit the prescribed form and any other relevant documents to Ihe Company for processing. 9.2 A Distributor must not procure or induce any person to become a Distributor of the Company by: 9.2.1 force or threats, or 9.2.2 making or provkling false or misleading informatioo or representations, incliJding the false representation that a Distributor would obtain financial gain by merely sponsoring a person to be a Distributor of the Company, or 9.2.3 providing or promising to provide gifts, monies or other forms of incentives, Of 9.2.4 falsely Of fralKlulently USing the Company's name Of logo 10 induce or entice the person to become a DistributOf. 9.3 A Distributor musl forthwith provide proper business training and guidance 10 \he new Distributors sponsored by himlher immediately upon appointment by the Company. 9.4 A Distributor musl at all times maintain an independent and professional relationship with hislher downline . 9.5 The Distributor must immediately fill up the sponsor's information in the Distributorship Application and Agreement form so as to avoid conflicts by the Distributors over the same prospect. This process enables the determination of who was the first person to reach the prospect. If more than one application is made, the first in time officially registered with the Company will be recognised. 9.6 Changing sponsors is strictly prohibited unless with the prior approvat in writing by the President of the CompallY. 9.7 Any proprietOf. partner. shareholder or Dire<:tor may only become a Distributor of the Company 3 mollths after the firm. partnership or company has beell termillated as a Distributor with the Company. 9.8 Any firm, partnership or company may only become a Distributor of \he Company 3 months after its proprietor, partner, shareholder or director has been terminated as a Distributor w~h the Company. 9.9 In the event of flOn-compliance with the aboVe, \he offending Distributor and the entire dowolille will be replaced, in the Company's sole diSCfetioll, under the proper upline. 9.10 Double spollsorillg which is the spollsorship of the same individual or entity by two existillg Distributors is flO! allowed. Complaints must be brought withill 6 months from the date of \he second distribuiOfShip. 9.11 The breach of any of the aboVe dauses is a serious violation of this Agreement and the Distributor may be subject to any action as Melilea in its sole discretion deems fit Of may result in the termination of this Agreement. 10 11 10.1 A Distributor sponsoring a downline shall be responsible for implementing aOO ensuring the comptiarlC& their dOW11lines of all terms and conditions, active treining, participation, counseling and supporting his downline and undertakes to perform his dulies in a bona fide manner. A Distributor also agrees to train, participate and support their sponsored downline in the performance 01 their functions as it is necessary to maintain oonlinuing oommunicalion with and supervision over the Oistributor's netwon;. This responsibi lity is a continuing one and is aimed 8t preventing the upline Distributor from enjoying benefits of his down line without providing the corresponding training to his downline that is crucial to the development of the dOWllline. Non-performance of these duties is a ground for termination of distributorship. 11 .1 No incentives will be calculated for Dislributor Cash BilUSales Invoice that do not have the Dislributor code or Distributor Application Form number for new Distributors or unidentified Distribulors on computation of bonus. All Distribulors musl keep a copy of the Distributor Cash BilVSales Invoice for record or for claim in the case of dispute or discrepancy. 11.2 Any dispute or discrepaJ'lCy in the computalion 01 bonuses or incentives or claim 01 non-receipt must be brought to the attention of the Company in writing within 14 days after the official date of issuance of bonuses, supported by the Distributor Cash BilVSales Invoice. Any dispute or discrepancy after this 14 days period will not be entertained and the Distributor will be deemed to have accepted any such dispute or discrepancy, if any. 11.3 The official date of issuance of monthly bonuses is before the 25th of the following month. by on-line banking. Bonus will be wrtheld for DistributOfS without a bank account and will only be released When provided with Distributors bank account. 11.4 A Distributor is neither guaranteed a specific income nor assured any level of profit or success. A DistributOl's profit and success can come only through the successful retail sale 01 products and the retail sates 01 other Distributors within hislher downline nelwt::lrk. 11.5 A Distributors promo~on in rank and entitiemenlto bonuses is as described in the Business Plan sedion of the Business Manual. 11.6 A Distributor may only transfer or assign his bonus al his own cost and expense and with prior written approval of the Company. In any event. the Company reserves the right 10 reverse the above transfer in the Company's sole and exclusive discretion. All such Distributors benefiting from the said eMier transfer are required to relinquish any benefits obtained by the earlier transfer. 12 13 12.1 Upon a written request from a Distributor, the Company is obliged 10 buy back its products from the Distributor at the price paid by the Distributor less all commissions. bonuse$ or benefits paid by the Company in respect of the sales 01 the said products and such processing fees of up to 10% of the price of the products paid by the Distributor. The Company is obliged to buy back ils products should the Distributor's appointment cease by ~s 0WI1 accord orwas terminated by the Company. provided always that: 12.1.1 The said products are in a good arid saleable condition. and 12.1.2 The period from !tie dale of purchase of the said products (supported by the relevant Distributor Cash 6111/Sales Invoice) to the dale of request by the distributor to the Company to buy back the said products does not exceed ninety (90) days, and in any event the dale of expiry of the product shall not be less than ninety days before expiry at the date of retum of the product. 12.1.3 The appropriate av, PV and other benerrts eamed by the Distributor from the sate of the said products are deducted from the Distributor's sales, and the commissions and benefits accruing to the Distributor adjusted accordingly. and 12.1.4 The said products are returned directly to the Company's Head Office or any of ih; Branch Offices. 12.1.5 A written request to buy back is given to the Company within thirty (30) days from the date the Distributor ceases to be a distributor of the Company whether by termination or otherwise. 12.2 "the Company buys back or is required to boy back its products from a Distributor for any reason whatsoever, the Company is entitled to re-evaluate and/or re-adjust the commissions, bonuses. funds. points. rank and other benefits paid to/enjoyed by the Distributor in respect to the sale 01 the said products. 12.3 The price paid by the Company for the products returned shalt be paid to the Distributor concerned within one (1) month from the date of the said products having been retumed to the Company. 13.1 The Company Business Ptan is based upon product sales to consumers and personal use of Distributors. Therefore stock-piling orders or purchasing in large I unreasonable quantities for inventory solely for the purpose of qualifying for the bonuses or rank advancements in the Bu$iness Plan are strictly prohibited by the Company. 13.2 A Distributor must have sold 130% of his existing stock before re-ordering new stock to prevent stockpiling. 13.3 Dumping of the products at beloW recommended retail price is strictly prohibited. The Company's management committee reserves the absolute right to terminate any Distributor fOUnd OOing so. 14 15 14.1 All information, in particular 'Distributor Organisation Chart ilnd Analysis', 'Breakaway leader Report' and 'Oistributor Address List' that are provided to Distributors is lor their exclusive and Ijm~ed use only and are the confidential and proprietary rights of Ihe Company as they contain trade secrets. 14.2 A Distributor shall not disclose the said lists to any third party including other Company Distributors not entitled to such lists. 14.3 A Distributor may not misuse any of Ihe Company's property, opportunity, corporate information Of trade secrets for the benefit of themselves or any third party. Any suct1 misuse will be viewed strictly and the Company may institute disciplinary proceedings and/or cause the immediate termination of Ihe Distributor's distributorship as the Company deems fit. In addition, the Company may insmute legal action against the Distriootor. Any delay or failure to pursue any action will not be construed as a waiver of the Company's rlghts. 14.4 The obligations under this paragraph will continue even afler the lermination of the DistributDts cootract. 15.1 A Distributor of the Company may only promote the products of the Company and the business opportunity with the Company and not the prodllCls or business opportunity of any other company, whether a Direct Selling company or non-Direct Selling company but selling products similar to the Company's products. 15.2 A Disllibutor may only promote the Company, its products and business opportunity through personat contact and by the Company's approved promotion channels as requested and approved by the Company. A Distributor may not promote the Company, its products, or its business oppoflun~y through the media. Consultations by media representatives should be referred to the President or Vice-President of the Company. The following actions by the Distributor are prohibited and the Company reserves the right to be indemnified of any costs iOC\lrred in preventing sucil actions or defending any actions, ~gal or othelWise. which may be faced by the Company; 15.2.1 Ctaims that are unreasonable or misleading in relation to potential earnings. 15.2.2 That profrts or revenue can be made due to a connection with a DistributOf or with the Company. 15.2.3 Mass distribution of brochures, name cards, flyers etc by way of e~ctronic mail, mail, placing in mail boxes, public places, vehicles or similar means. 15.3 A Distributor is prohibited from using trademarks, service marks. copyrights, trade names. product names, or logos belonging to the Company Of any company associated with Melilea ami their products. in any form of advertising unless w~h prior written permission from the Company. Non-compliance with this clause is coosidered a serious violation of this Agreement and may result in disciplinary action which may include immediate termination of the Distributor. 16 15.4 The Company's logos or names shall not be used or displayed on any area visible to the public. 15.5 No celebrity endorsement may be used unless with prior written approval of the celebrity. 15.6 A Distributor may ooly use business cards and personalised safes aids that are prodl.lCed by the Company_ 15.7 Business cards used by all disllibutors must be of the same type in terms of colour, size, leld, font and contents as per the sample contained in the Distributor's manual. The exact content as staled above is aHowed in different languages. Before use, a Distributor must submit fof approval to the Company a sample of the business card, Non-compliance will rernler the Oistributor subject to a displinary action. Thereupon, a new sample for approval by the Company will have to be submitted. 15.8 A Distributor may not use Intelleetual Property and Proprietary information belonging to the Company without prior authorisation from the Company. Any unauthorised breach constitutes a material breach of this Agreement All unauthorised use of such material becomes the property of the Company and must be immediately aSSigned to the Company. A Distributor may not use or reserve domain names belonging to the Company am:! agrees to renounce his rights to such names if found to be similar with the Company's even tMugh the Distributor may have had a prior right to the Company_ 15.9 A Distributor may only use websites and website addresses as approved by the Company and on templates specified by the Company. 15.10 A Distributor is prohibited from placing advertisements in newspapers. maga~ines. or other publications, promoting himselflherself or the Company's products without the prior written consent of the Company. A DistribtJtor is also prohibited from bringing to the attention of the media any disputes between the Distr~butor and another Distributor or between the DistribtJtor am:! the Company. The Distributor agrees that this prohibition will also apply even after the Distributor leaves the Company. A breach of this provision is viewed very seriously am:! the Company reserves the right to immediately terminate the Distributor am:! commence legal action for damages against the Distributor. 16.1 The promotion of the Company's opportunity and the sale of ~s products are only to be done through its authorised DistribtJtors and its products shall not be sold/displayed at reta il outlets, day/night markets, pharmacies, departmental stores, trade shows, conventions or any other such gatherings withoot prior permission of the Company. Any Distributor doing so for his own benefit shall have his distributorship terminated. 16.2 Any Distributor selling the Company products to the proprietors of the above businesses shall be liable to the Company for losses including but not limited to loss of reputation and consequential losses. 16.3 A DistribtJtor is also prohibited from selling to any person who will ultimately sell products through retail stOflls_ 17 18 19 17.1 A Distributor may only make product claims end representations as approved by the Company_ Product claims must be limited to claims that the products are safe to use and for the general well being and appearance althe person. 17.2 No claims carl be made as to medicinal values altha product. 18.1 It is expressly understood thai all Distributors shall be solely responsible for !he $ubmission altheir ennuallncome Tax returns and payment 01 same. The Company does not condone any acts of tax evasion. 18.2 A Distributor is responsible for all hisll1er own business decisions efld expenditures arising out of operating the business. 19.1 The Company reserves the right to change prices, amend, alter, vary, add or update the terms and conditions of the Distributor'S Application and Agreement, Business Manual, Business Plan, International Distribution and Sponsor Agreement, Preliminary Application and Agreement For Distributorsllip and otller rules and regulations (Ilereinafter referred to as tile said Rules) at any time, and whenever it is deemed necessary and without consent of the DistributOf. The variations wilt be publislled in tile Company's official magazine or website and tile Distributor agrees tllat tllis wilt be deemed to serve as notice of change to tile Distributor. 19.2 Tile distributor sllall be bound by any such future changes, amendments. variations or additions. By continuing to act as a Distributor after tile said modifications, tile OistribuiOf's acts sllall be deemed to constituta acceptance of any such amendment to tile agreement. 19.3 Tile Company may vary tile price and Products either by making such changes in design, production or packaging of the Prodl.lCls as tile Company tIlinks fit or by tile witlldrawal of Products which tile Company proposes to witlldraw from its product range or by tile addition to tile Products. 19.4 Tllis contract is to be treated as tile finat agreement between the Distributor and tile Company and supersedes all prior or inconsistent agreements. wllether written or oral. between tile parties. However, tile Company reserves the right to impose additional terms and conditions specific to a Distributor or generally to all Distributors. 20 21 22 International Distributors/Sponsors 20.1 Each country has different forms and agreements. A Distributor agreement must be filed in the country of residence. Agreements used for a wrong country will be invalid. The agreement becomes binding if approved by the Company. 20.2 A Distributor musl inform the Company's office in the eountry of origin of intention to practice in a diffefen\ country_ 20.3 A Distributor must enter inlo all International Distribution and Spollsor Agreement with the Company before sponsoring Distributors in a country other than the first mentioned Distributor's country of distributorship. 20.4 A Distributor may order products and sales aids for his given country which can only be sold in the said given country. 20.5 A DislributOf may neither import any of the Company'!; product:; nor facilitate its importatiofl for Distribution or for any other reason. 20.6 A Distributor shall not take any steps in another country which is not yet officially opened, with the intention of commencing the Company's business. He may not solicit for dients, adverfjse, apply for trademarks or trade names indudirlg reserving the Company·s name (induding website names and addresses). Neither may the Distributor sewre the approval for any of the Company's products or business practices. My costs incurred by any action by the Company necessary to remedy the above will have to be indemnified by the Distributor. 20.7 Any DistributOf who does not comply with the above will be terminated or be barred from participating in the new intemational market for two (2) years from the date of the official opening of the new intemational market 21 .1 A Distributor shall not make any statement in any form about any person, company or products, whether of the Company or its competitors whether written or oral. which is misleading, false or inaccurate. 22.1 The Company strictly pronib~s the participation by its distributors in any pyramid scheme or having the appearance of a pyramid scheme. The Company's management committee reserves the absolute right to terminate any Distributor found to do so. 22.2 A Distributor shall be deemed to have knowledge of all the Terms and Conditions appearing in all the Company documenls for the time being in force and it shall be incumbent upon the Distributor to check the latest Terms and Conditions as set out in the official and definitive copy as kept at the Company"s Head Office. It is also the responsibility of the Distributor to update his downlines. New Terms and Conditions and Forms will replace the old. 22.3 If any provision 01 any Terms and Conditions or Procedures or Code of Ethics or any part ttlereol contravenes any: 22.3.1 Act of Partiament or subSidiary legislation, or 22.3.2 Orders 01 Governmental policy, or 22.3.3 Terms and conditions of the licerlse grarlted by the relevarll authority pursuant to the Direct Sales Act, 1993, or 22.3.4 Terms and cOrld itiorls as may be imposed by the relevarlt authority from time to time; the contravening provision 01 such terms and conditions shall be rendered invalid and urlerlforceable without affectiflg the other provisiorls of these Terms arid C~lf\ditions , Policies & Procedures or the Code of Ethics. 22.4 In the event of any dispute arising between a Distributor and a customer or prospec~ve customer or Company·s Distributors, to immediately inform the Company and provide the Company with details of the circumstances of the dispute and not to institute proceediflgs in respect of it or to enter into any compromise in respect of it or to release any debt without the prior written consent of the Company. 22.5 The Distributor hereby agrees that the Company and its Officers or agents shall not be liable for any third party claim for any consequential. incidentat. special or punrtive damages, or claim for loss of profits. Any such claim by the third party will be indemnified by the Distributor to the Company or the third party. 22.6 The Distributor shall indemnify and keep the Company fully indemnified from and against any and all loss. damage or liability (whether criminal or civil) suffered and legal fees and costs incurred by the Company resultiflg from a breach of this Agreement by the Distributor including but not limited to: 22.6.1 Any act of fraud, neglect. dishonesty or default on the part of the Distributor or his agents, employees, licensees or customers; 22.6.2 Breaches resulting in any successful claim by any third party alleging libel or slander in respect of any matter arising from the supply of the products or conduct of the Distributor. 22.6.3 Breaches in connection with any unauthorised Warranty issued by the Distributor and also for any aHeration. removal. tamperiflg or modification of any olthe Products. 22.7 The Distributor ackoowledges that he/she has read and understood and agree to the terms set forth in this Agreement. 22.8 This Agreement supersedes any previous egreement betwaen the parties hereto in relation to the matters dea~ with herein and represents the entire Agreement between the parties hereto. 22.9 Reference to any statute or statutory provisions includes a reference to that statuta or statutory provision as from time to time amended. e~tended or re-enacted. 22.10 Unless the context otherwise requires. reference to any clause or schedule or appendi~ is to a clal/se or schedule or appendix of or to this Agreement. 22.11 The headings in this Agreement are inserted for convenience only and shall not affect the construction hereof. 22.12 All agreements on the part of either 01 the parties which comprise more than one person or entity shall be joint and several. 23 24 25 23.1 Any demand, request Of notice requiring to be given under this Agreement shall be deemed to be sufficiently served in the case of ill notice given by; 23.1.1 The Compaoy, upon being addressed and despatched by electronic mail. facsimile, ordinary post. registered post, A. R Registered Post or personal service or service as deemed fit by the Company, to the Distributor at the address provided on the distributor epplication form or the last known place of business or residence of the Distributor. A notice is deemed served, in the case of service by facsimile, immediately upon being faxed, and in any other case, fivB (5) days altar the dats 01 pos~ng . 23.1.2 The Distributor. upon being addressed arid despatched by persoosl service or A R. Registered post to \he Con1:lany at \he(" office in Me'aka as set 0l.Il below. In the event of service by A. R. Registered post. evidence of receipt by the Company is to be proved by way of proof of the Company's company stamp indoffiement on the A. R. return card. 23.2 All forms and notices which under this Agreement require to be signed by or on behalf of the Company shall be sufficiently signed by its Directors or by its Secretary or by ~s duty authorized officer and all forms and notices which under this Agreement is required to be signed by or on behalf of the Distributor shall be signed by some responsible person(s) authorized by the Distributor, a specimen of whose signature authenticated by the Distributor Shall previously have been lodged w~h the Company. 24.1 Time wherever mentioned shall be the essence of this Agreement. 25.1 This Agreement shalt be binding on the bef!eficiaries. personal representatives and permitted assigns of the parties hereto. 26 27 28 26.1 II any of the provIsions of this Agreement is found by any court or other competeJ'lI authority to be void or unenforceable in any jurisdiction, such provision shall be deemed to be deleted from this Agreement and the invalidity or unenforceability of such provision shall not affect the other provisions of tllis Agreement and all other provisions shall remain in full force and effect. Notwithstanding the foregoing, the parties hereto shall negotiate ill good faith in order to agree to a mutually satisfactory term in substitute for the provisiorl so found to be void or unenforceable. 27.1 No failure or delay on the part of the Comparly in exercising nor any omission to exercise any rlgM. power or privilege accruing to the Company UPOIl allY default Oil the part of a Distributor shall affect or impair allY such right, power or privilege to be COllstrued as a waiver thereof or allY acquiescellce to such default. No waiver by the Compally ill respect of ally breach shall operate as a waiver ill respect of allY subsequellt breach. Ally waiver must be givell ill writillg. 28.1 III the evellt of My dispute pertaillillg to the formatioll, cOllstructioll, validity or performance of this Agreemellt or as to the rights al'ld liabilities arisillg betweell the CompallY al'ld the Distributor which call1lot be resolved between the parties, both parties hereby agree that the dispute shall ollly be resolved ill the High Court of Malaya at Melaka or allY other court of competellt jurisdictioll ill Melaka or by way of arbitratioll as the CompallY deems fit. A Distributor shall IlOt seek redress with ally departmellt, Millistry or ally other adjudicating body. 28.2 If by arbitratioll, a sole arbitrator to be agreed betweell the parties shall be appoillted. The forum alld type of arbitralioll shall be solely decided by the CompallY_ 28.3 The formatiOll, constructiOIl, validity alld performallce of thia Agreemellt shall be govemed in all respects by Malaysiall Law. 29 30 29.1 All costs, legal or othelWise shall be borne by the Distributor on a soIicitor-dient basis. 30.1 The word "DistributOf" as mEln~oned throughout this Agreement shall include Star Leaders. 30.2 The English Version of all the Company issued materials shall be deemed to be the official interpretation. In the event of any connicts between different versions of materials, the English Version shall prevail. 30.3 Unless the conte:d otherwise requires, the following interpretations shall be used In the Agreement: 30.3.1 Words referring to the masculine gender shall include the feminine and neuter genders and vice versa; 30.3.2 Words referring to a singular object/person shall include the plural number and vice versa; 30.3.3 The section headings are included for the convenience of reference only and shall nol affe<::! the interpretation of the Agreement; 30.3.4 Where any word or EI)(pression is defined in the Agreement, the definition shall extend to all grammatical varia tions and cognate axpressions of the word or expression so defined; Pursuallt to the Direct Sales Act 1993, all Distributors operatillg the the Company business are to observe and adhere to the following regulations or face prosecution by the relevant authorities: A. Identification Card a. Distributors must display their the Company Distributorship Authority Card (MID) and cany along their National Registration Identity Card whenever operating the business, and duly produce them whenever requested to do so. COMPANY or MELILEA Throughout this manual the term "Company" or "Melilea Intemational" refers to: Melilea (M) Sdn. BM. CO.reg. No: 256079-U. GROUPPV This is the total PV of the Company products sold within any given month by your groups downline including breakaway Star Leaders and their groups. LEADERSHIP BONUS This is the leadership bonus paid 10 Qualifying Star Leaders on monthly qualification according to the Company Business Plan. MONTHLY VOLUME This is the volume generated in a calendar month. The business month closes at midnight on the last day of the calendar month. QUALIFYING STAR LEADER LINE This is a line which has a Star Leader with monthly personal group sales PV (PGPV) of 800 PERSONAL GROUP This refers to alt Distributors in tine of descent. e~cluding breakaway Star Leaders and their groups. PERSONAL GROUP SALES PV (PGPV) This is the personal group sales PV of products sold by alt Distributors in line of descent exduding breakaway Star Leaders and their groups. PERSONAL SALES (PPV) This is the PV of products sold by the Distributor personalty within the given month. POINT VALUE (PV) This is the value attached to the produ.::t sold. This value will be taken for calculation of rank advancement and qualification for bonuses. QUALIFYING STAR LEADER This is an active Star Leader with a monthly personal group sales PV (PGPV) of at least 30 PPV and of at least 800 PGPV or a Star Leader who qualifies for leadership bonus for a particular month. RETAILING PROFIT This is the difference between the Distributor price and the suggested customer or retail price. RETAIL OR CUSTOMER PRICE This is the price that is quoted on the order form and represents a suggested retail currency f,gure which the customer pays for the products. The Company reselVes the right to adjust this suggested customer or retail price. depending on the market Situation. STAR LEADER This refers to any Distributor who is promoted to the level of Star Manager and above.