SECTION 1 – INTRODUCTION

1.1 – Policies and Pay Plan Incorporated into Affiliate Agreement: These Policies and Procedures, in their present form and as amended at the sole discretion of Daily-Bits (dba as Daily-Bits, hereafter “Daily-Bits” or the “Company”), are incorporated into, and form an integral part of, the Daily-Bits Affiliate Agreement. Throughout these Policies, when the term “Agreement” is used, it collectively refers to the Daily-Bits Affiliate Application and Agreement, these Policies and Procedures, and the Daily-Bits Compensation Program. These documents are incorporated by reference into the Daily-Bits Affiliate Agreement (all in their current form and as amended by Daily-Bits).

1.2 – Changes to the Agreement: Daily-Bits reserve the right to amend the Agreement and its prices in its sole and absolute discretion. By joining Daily-Bits the Affiliate accepts the Affiliate Agreement, and agrees to abide by all amendments or modifications Daily-Bits elects to make. Amendments shall be effective thirty (30) days after publication of notice that the Agreement has been modified. 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) inclusion in Company periodicals or (4) special mailings. The continuation of your affiliateship or an Affiliate’s acceptance of bonuses or referral payments of any kind constitutes acceptance of any and all amendments.

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 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.

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 Daily-Bits to exercise any right or power under the Agreement or to insist upon strict compliance by an Affiliate 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 Daily-Bits’s right to demand exact compliance with the Agreement. The existence of any claim or cause of action of an Affiliate against Daily-Bits shall not constitute a defense to Daily-Bits’s enforcement of any term or provision of the Agreement.

SECTION 2 – WORKING WITH Daily-Bits

2.1 – Requirements to Become an Affiliate: To be an active Daily-Bits Affiliate, each applicant must

2.2 – Affiliate Benefits: Once an Affiliate Application and Agreement has been accepted by Daily-Bits the benefits of the Compensation Program are available to the new Affiliate. These benefits include the right to:

2.3 – Term and Renewal:  The term of the Affiliate Agreement is month to month. If you fail to pay the appropriate monthly fee, the Affiliate Agreement will be canceled.

SECTION 3 – OPERATING A Daily-Bits Affiliate Business

3.1 – Adherence to the Daily-Bits Compensation Program: Affiliates must adhere to the terms of Daily-Bits Compensation Program as set forth in official Daily-Bits literature.

3.2 – Advertising

3.2.1 – General: All Affiliates shall safeguard and promote the good reputation of Daily-Bits and its services and/or products. In the marketing and promotion of Daily-Bits, the Compensation Program, and Daily-Bits products and/or services Affiliates must avoid all discourteous, deceptive, misleading, unethical, illegal or immoral conduct or practices. In referring others to Daily-Bits, Affiliates must use only official materials produced by Daily-Bits. Accordingly, Affiliates must not produce their own literature, advertisements, sales tools and promotional materials, or Internet Web pages, or they will be subject to suspension and/or termination.

3.2.2 – Trademarks and Copyrights:  Daily-Bits will not allow the use of its trade names, trademarks, designs or symbols by any person, including Daily-Bits Affiliates, without its prior, written permission. Affiliates may not use or attempt to register any of Daily-Bits trade names, trade-marks, service names, service marks, product names, the Company’s name or any derivative thereof, for any Internet domain name.

3.2.3 – Media and Media Inquiries:  Affiliates must not attempt to respond to media inquiries regarding Daily-Bits, its products or services. All inquiries by any type of media must be immediately referred to the Daily-Bits Marketing Department.

3.2.4 – Unsolicited Email: Affiliates shall not use mass email (spam) as a means of promoting Daily-Bits. Affiliates may send email to prospective referral affiliates only if they have a personal or business relationship with such individual or if they have received permission from the recipient to send them an email relating to Daily-Bits products, services or program.

3.2.5 – Unsolicited Faxes:  Except as provided in this section, Affiliates may not use or transmit unsolicited faxes or use an automatic telephone dialing system relative to the solicitation of prospective affiliates. The term “automatic telephone dialing system” means equipment which has the capacity to: (a) store or produce telephone numbers to be called, using a random or sequential number generator and (b) to dial such numbers. The term “unsolicited faxes” means the transmission via telephone facsimile of any material or information advertising or promoting Daily-Bits, its products and/or services, its compensation plan or any other aspect of the company which is transmitted to any person, except that these terms do not include a fax or e-mail: (a) to any person with that person’s prior express invitation or permission or (b) to any person with whom the Affiliate 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 an Affiliate and a person, on the basis of: (a) an inquiry, application, purchase or transaction by the person regarding products offered by such Affiliate or (b) a personal or familial relationship that has not been previously terminated by either party.

3.2.6 – Telephone Book Listings:  No Affiliate may place telephone directory display ads using the Daily-Bits name or logo. Affiliates may not answer the telephone by saying “Daily-Bits” or in any other manner that would lead the caller to believe that he or she has reached the corporate offices of Daily-Bits.

3.3 – Business Entities:  A corporation, limited liability company, partnership or trust (collectively referred to in this section as a “Business Entity”) may apply to be an Affiliate by submitting an Affiliate Application. The Business Entity, as well as all of the shareholders, affiliates, partners, trustees or other parties with any ownership interest in, or management responsibilities for, the Business Entity (collectively “Affiliated Party”) is individually, jointly and severally liable for any indebtedness to Daily-Bits, compliance with Daily-Bits Policies and Procedures, and other obligations to Daily-Bits.

3.3.1 – Income Claims:  Because Daily-Bits Affiliates do not have the data necessary to comply with the legal requirements for making income claims, an Affiliate, when discussing Daily-Bits’s Compensation Program with a prospective Affiliate, may not make income projections, income claims or disclose his or her Daily-Bits income (including the showing of checks, copies of checks, bank statements or tax records).

3.4 – Errors or Questions: If an Affiliate has questions about or believes any errors have been made regarding commissions the Affiliate must notify Daily-Bits in writing within 60 days of the date of the purported error or incident in question. Daily-Bits will not be responsible for any errors, omissions or problems not reported to the Company within 60 days.

3.5 – Governmental Approval or Endorsement: Government agencies or officials generally do not approve or endorse any affiliate marketing companies or programs. Therefore, Affiliates shall not represent or imply that Daily-Bits or its Compensation Program have been “approved”, “endorsed” or other-wise sanctioned by any government agency.

3.6 – Independent Contractor Status: Affiliates are independent contractors and are not purchasers of a franchise or a business opportunity. The agreement between Daily-Bits and its Affiliates does not create an employer/employee relationship, agency, partnership or joint venture between the Company and the Affiliate. An Affiliate shall not be treated as an employee for his or her services for any country tax purposes. All Affiliates are responsible for paying their country’s local and national taxes due from all compensation earned as an Affiliate. The Affiliate has no authority (expressed or implied), to bind the Company to any obligation. Each Affiliate shall establish his or her own goals, hours and methods of promotion, so long as he or she complies with the terms of the Affiliate Agreement, these Policies and Procedures and applicable laws.

3.7 – Adherence to Laws and Ordinances: Affiliates shall comply with all local and national laws and regulations of their respective country in the conduct of their businesses.

3.8 – Actions of Household Affiliates or Affiliated Individuals: If any individual of an Affiliate’s immediate household engages in any activity that, if performed by the Affiliate, would violate any provision of the Agreement, such activity will be deemed a violation by the Affiliate and Daily-Bits may take disciplinary action against the Affiliate. 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 Daily-Bits may take disciplinary action against the Business Entity.

3.9 – Telemarketing Techniques for the United States Market:  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 Daily-Bits does not consider Affiliates to be “telemarketers” in the traditional sense of the word, these government regulations broadly define the term “telemarketer” and “telemarketing” so that an Affiliate’s inadvertent action of calling someone whose telephone number is listed on the federal “do not call” registry could cause him or her to violate the law. Moreover, these regulations must not be taken lightly, as they carry significant penalties (up to $20,000.00 per violation). Therefore, Affiliates must not engage in telemarketing in the operation of their Daily-Bits affiliate businesses. The term “telemarketing” means the placing of one or more telephone calls to an individual or entity to market and promote Daily-Bits products or services. “Cold calls” made to prospective affiliates that promote either Daily-Bits products or services or the Daily-Bits Compensation Program constitute telemarketing and are prohibited. However, a telephone call(s) placed to a prospective member (a “prospect”) is permissible under the following situations:

3.10 – Back Office Access:  Daily-Bits provides an online back office available to its Affiliates. Back offices provide Affiliates access to confidential and proprietary information that may be used solely and exclusively to promote the development of an Affiliate’s Daily-Bits business and to increase sales of Daily-Bits’ products or services. However, access to a back office is a privilege, and not a right. Daily-Bits reserve the right to deny an Affiliate’s access to the back office at its sole discretion.

SECTION 4 – RESPONSIBILITIES OF AFFILIATES

4.1 – Change of Address, Telephone and e-Mail Addresses:  To ensure timely delivery of Company information, it is critically important that Daily-Bits files are current. Electronic mail addresses (e-mail) must be kept up to date at all times as e-mail is the primary mode of communication between Daily-Bits and the Affiliates. Affiliates must amend their contact information through their Back Office as necessary.  Affiliate consent to Daily-Bits email communications and promotions.

4.2 – Non-disparagement:  Daily-Bits desires to provide its Affiliates with the best products and service available. Accordingly, we value your constructive criticisms and comments. All such comments should be submitted in writing to the Affiliate Services Department. Remember, to best serve you, we must hear from you! While Daily-Bits welcomes constructive input, complaints, negative comments and unflattering remarks made in public or on any online website by Affiliates about the Company, its products, services or compensation program serve no purpose other than to demean our affiliateship organization and to sour the enthusiasm of other Daily-Bits Affiliates. Affiliates must not disparage, demean, make negative remarks about Daily-Bits, other Daily-Bits Affiliates, Daily-Bits products, the Compensation Program or Daily-Bits directors, officers or employees or make threats to Daily-Bits. At the sole discretion of Daily-Bits any violation of this paragraph may result in immediate suspension or termination and forfeiture of all rights, benefits and balances.

4.3 – No Territory Restrictions:  There are no exclusive territories granted to anyone. No franchise fees are required.

SECTION 5 – BONUSES AND COMMISSIONS

5.1 – Bonus and Commission Qualifications:  An Affiliate must be active and in compliance with the Agreement to qualify for bonuses and commissions. So long as an Affiliate complies with the terms of the Agreement, Daily-Bits shall pay commissions to such Affiliate in accordance with the Compensation Program.

5.2 – Adjustments to Bonuses and Commissions:  Affiliates receive bonuses and commissions based on the actual sales of products and services to end consumers. When a refund claim is filed with Daily-Bits, the bonuses and commissions attributable to the disputed product(s) will be deducted in the month in which the refund is given, and continuing every pay period thereafter until the commission is recovered, from all Affiliates who received bonuses and commissions on the sales of the refunded products.

SECTION 6 – DISPUTE RESOLUTION AND DISCIPLINARY PROCEEDINGS

6.1 – Disciplinary Sanctions Violation of the Agreement, these Policies and Procedures, or 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 an Affiliate that, in the sole discretion of the Company may damage its reputation or goodwill, may result, at Daily-Bits’ discretion, in one or more of the following corrective measures:

6.2 – Arbitration:  Any controversy or claim arising out of or relating to the Agreement, or the breach thereof, shall be settled by arbitration administered and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Affiliates waive all rights to trial by jury or to any court. All arbitration proceedings shall be held in the local vicinity of the company. There shall be one arbitrator, an attorney at law, who shall have expertise in business law transactions with a strong preference being an attorney knowledgeable in the direct selling industry. Each party to the arbitration shall be responsible for its own costs and expenses of arbitration, including legal and filing fees. The decision of the arbitrator shall be final and binding on the parties and may, if necessary, be reduced to a judgment in any court of competent jurisdiction. This agreement to arbitration shall survive any termination or expiration of the Agreement.

Notwithstanding the foregoing, nothing in these Policies and Procedures shall prevent Daily-Bits from applying to and obtaining from any court having jurisdiction a writ of attachment, a temporary injunction, preliminary injunction, permanent injunction or other relief available to safeguard and protect Daily-Bits’ interest prior to, during or following the filing of any arbitration or other proceeding or pending the rendition of a decision or award in connection with any arbitration or other proceeding.
6.3 – Governing Law, Jurisdiction and Venue: Jurisdiction and venue of any matter not subject to arbitration shall reside exclusively in the local jurisdiction of the company as indicted on the company’s web site.

SECTION 7 – INACTIVITY, RECLASSIFICATION AND CANCELLATION

7.1 – Effect of Cancellation: So long as an Affiliate remains active and complies with the terms of the Affiliate Agreement and these Policies and Procedures, Daily-Bits shall pay commissions to such Affiliate in accordance with the Compensation Program. An Affiliate’s bonuses and commissions constitute the entire consideration for the Affiliate’s efforts in selling products and services. Following an Affiliate’s non-payment of his or her fee, cancellation for inactivity or voluntary or involuntary cancellation of his or her Affiliate Agreement (all of these methods are collectively referred to as “cancellation”), the former Affiliate shall have no right, title, claim or interest to the affiliates he or she introduced, or any commission or bonus from the sales generated by those introduced. An Affiliate whose affiliateship is cancelled will lose all rights as an Affiliate. This includes the right to market Daily-Bits products and services and the right to receive future commissions, bonuses or other income resulting from the sales and other activities of the Affiliate’s former introductions.  In the event of cancellation, Affiliates agree to waive all rights they may have, including but not limited to property rights, incentives, Cash Balances, to their formerly introduced affiliates and to any bonuses, commissions or other remuneration derived from the sales and other activities of their formerly introduced affiliates.

7.2 – Involuntary Cancellation:  An Affiliate’s violation of any of the terms of the Agreement, including any amendments that may be made by Daily-Bits in its sole discretion, may result in any of the sanctions listed above, including the involuntary cancellation of his or her Affiliate Agreement. Cancellation shall be effective on the date on which written notice is mailed, emailed, faxed or delivered by an express courier, to the Affiliate’s last known address, email address or fax number. Daily-Bits reserves the right to terminate all Affiliate Agreements upon thirty (30) days written notice in the event that it elects to: (1) cease business operations; (2) dissolve as a corporate entity or (3) modify their methods for paying commissions, promoting and marketing Daily-Bits products and services.

7.3 – Voluntary Cancellation:  An Affiliate has a right to cancel their affiliateship 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 Affiliate’s signature, printed name, address and Daily-Bits Identification Number.

7.4 – Non-renewal:  An Affiliate may also voluntarily cancel his or her Affiliate Agreement by failing to pay the monthly fees.