Chapter 11: Ownership and Transfer of UnFranchise Business

 

 

SEC. 1                Business Entity Distributorships

A partnership, corporation or other form of business organization (hereafter referred to as a business entity) may be a Distributor provided documentation is submitted detailing all trustees, partners, stockholders, officers and/or directors in the business, their respective Social Security numbers or Social Insurance numbers (for Canada), and their respective ownership interest. If the business entity is a corporation, a certified copy of the Articles of Incorporation must also be submitted. The partner or officer who submits the documentation must be authorized to enter into binding contracts on behalf of the business. However, an individual may not be registered in more than one distributorship of any kind. If a business entity distributorship has ownership by any person who is a citizen of any country or territory in which Market America is not open for business, then the principals of the business entity will be required to provide documentation showing that a majority of the ownership interest is held by citizen(s) of countries and/or territories in which Market America is open for business.

(A)     Initial Application: For a business entity to apply as a Distributor, it must obtain, complete and submit to Market America appropriate documentation.

(B)     Change In Status: A Distributor may change status from an individual to a business entity, or from a business entity to an individual, with proper and complete documentation.

(C)     Eligibility: In addition, by submitting the business entity documentation, Distributors certify that no person with an interest of debt or equity in the business has had an interest in a Market America distributorship within 270 days of the submission of the appropriate documentation (unless it is the continuation of an existing distributorship that is changing its form of doing business).

(D)     Failure to Submit Required Documentation: If an Application and Agreement is received from a business entity without the appropriate documentation, Market America will issue written notification to the applicant requesting such documentation. If the appropriate documentation is not received by Market America within 60 days of the date notification was sent, the Distributor’s contract for that distributorship will be cancelled.

SEC. 2                Distributorship ID Changes

To change the ID number of an existing distributorship (e.g. from Social Security number to Federal ID number), Distributors must submit a letter to the Compliance Department containing the current ID number, the new ID number (copy of Federal ID certificate, if applicable), a processing fee of $10 per BDC to be changed, and the signature of the Distributor(s).

SEC. 3                Distributorship Name Changes

(A)     Deleting Name from Distributorship: To delete your name from an existing distributorship, you must submit the Name Deletion Form to Market America. The form must be signed by the Distributor whose name is to be deleted and any remaining Distributor(s) of the same distributorship (all ID numbers must be included). All signatures on the Name Deletion Form must be notarized (or sworn by a Commissioner of Oaths in Canada).

(B)     Adding Name(s) to Existing Distributorships: Addition of names to existing distributorships is rarely permitted, actively discouraged, and only approved in very limited and specific instances or unique and extenuating circumstances. To request the addition of names to an existing distributorship, the requesting Distributor(s) must submit a signed letter describing the reason for the request, along with a completed Name Addition Form, to the Compliance Department. All signatures on the Name Addition Form must be notarized (or sworn by a Commissioner of Oaths in Canada). Upon review and investigation, the Compliance Department will notify the requesting Distributor(s) in writing of its decision. Please allow approximately two weeks for the process to be completed.

(C)     Changing the Existing Name on a Distributorship: Changing existing names of distributorships is rarely permitted, actively discouraged, and only approved in very limited and specific instances or unique and extenuating circumstances. To request to change the name of an existing distributorship, the requesting Distributor(s) must submit a signed letter describing the reason for the request to the Compliance Department. All persons who are listed on the distributorship must sign the letter. All signatures on the request letter must be notarized (or sworn by a Commissioner of Oaths in Canada). Upon review and investigation, the Compliance Department will notify the requesting Distributor(s) in writing of its decision. Please allow approximately two weeks for the process to be completed.

SEC. 4                Married Couples

Market America shall consider each married couple as a single distributorship. Married couples cannot have separate distributorships.
If two current Market America Independent Distributors become married or plan to become married, they must contact the Compliance Department for instructions, as marriage between Distributors can impact a variety of policies, including the prohibition of multiple distributorships. If a Distributor is married, a copy of the Distributor’s marriage license should be submitted to the Compliance Department in order to add the Distributor’s spouse to the distributorship.

SEC. 5                Divorce or Dissolution of Partnership

If a husband/wife divorces or if a business entity dissolves, then one of the Distributors involved must contact the Compliance Department at Market America regarding control of the distributorship and the right to receive commissions after the divorce or dissolution. If all parties involved agree regarding who will have control and ownership of the business after divorce or dissolution, and if the agreement is memorialized in a document signed and notarized by all parties involved, then Market America will honor the agreement. Market America cannot “split” a distributorship. If Market America receives reasonable notice of a dispute between the parties involved, then Market America will hold commissions in escrow and will not execute any control changes for the distributorship until Market America receives an acceptable signed and notarized agreement or a certified copy of a court order clearly resolving these matters.         

SEC. 6                Multiple Distributors at Same Address

Under the Terms and Conditions of the Independent Distributor Application and Agreement, there may only be one distributorship per address (household). Multiple distributorships in a single household constitute a breach of contract and are grounds for termination unless prior written approval has been obtained from the company.

(A)     Approval: Distributors must apply for approval to have a second distributorship in the same household prior to submitting the application. Distributors must write the company (attention: Compliance Department), state the circumstances, and receive a written approval from the company. Failure to obtain approval prior to submitting the application may result in the cancellation of the second distributorship. The company may also require the first distributorship to purchase all returned product, with BV being placed in BDC-001. Failure to obtain proper approval may also result in the termination of both distributorships.                

(B)     Limitations: If the company approves an additional distributorship in the same household or address, this distributorship MAY NOT BE USED FOR ACTIVATING ANY BUSINESS DEVELOPMENT CENTER. The second distributorship will have no sponsor indicated in Market America’s computer database.

SEC. 7                Change of Address / Phone Number

Distributors must notify Market America immediately of any address/phone number change on the “Request For Address Change” Form (which is located online on their UnFranchise® Business Account), or Distributors may update their own information online on their UnFranchise Business Account. It is advised that changes in address/phone number be submitted as early as 30 days in advance, if possible. Failure to do so could place your distributorship in jeopardy regarding sponsorship requirements, multiple Distributors at the same address, missed Powerline magazines, missed shipments, etc.

SEC. 8                Transfer of Sponsorship

Transfer of sponsorship is rarely permitted, actively discouraged, and only approved in very specific instances of confirmed unethical activity or other extremely unique and extenuating circumstances. Maintaining the integrity of sponsorship is absolutely mandatory for the overall success of the Market America UnFranchise Business Development System and its Management Performance Compensation Plan. Transfers will be governed by the company as follows:

(A)     Administration: Transfer of sponsorship must be approved in writing by the Compliance Department prior to the submittal of the required documentation. If approved, all transfer requests require obtaining the notarized signatures of the Distributors’s sponsor (if active) and five consecutive active upline management (Certified Executive Coordinators or higher Pin Levels) on the written transfer request.

(B)     Unethical Sponsorship: In a case of confirmed unethical sponsorship, the company will review the situation and take appropriate action at its sole discretion regarding sponsorship and genealogy adjustments. Such actions may include but are not limited to transfer of downline organizations intact or transfer of all personally sponsored Distributors.

(C)     Cancellation/Inactivity: Cancellation and/or inactivity of the respective Distributors for more than 270 days entitles the Distributors to submit a “new” Application and Agreement with a new sponsor (see 270-Day Rule).

SEC. 9                Transfer of Distributor to Another Genealogy Line

Transfers to another genealogy line are rarely permitted and actively discouraged. Maintaining the integrity of genealogy lines is absolutely mandatory for the overall success of the UnFranchise Business Development System and its Management Performance Compensation Plan. Transfers will be governed as follows:

(A)     Circumstances: A letter describing the reason for the request must be submitted to the Compliance Department. Upon review and investigation, the Compliance Department will notify the Distributors in writing of its decision. Please allow approximately two weeks for the process to be completed.

(1)     If approved, all transfer requests require the notarized signatures of the Distributors’s five immediate and consecutive active upline management (Certified Executive Coordinators or higher) on the written transfer request. All transfer requests must be accompanied by a $50.00 processing fee.

(2)     Transfer will only be processed for the respective Distributors. All current downline Distributors shall remain in the original genealogy line, and the transferred Distributors will be unsponsored in the new genealogy line.

(B)     Accrued Group Business Volume: All accrued Group Business Volume prior to transfer will not transfer with the Distributor. Group Business Volume will begin to accrue for the week linkage to the “new” genealogy line is completed. Please allow 10 to 15 business days for completing the transfer process in the computer. Do not place Distributors in the downline until process has been completed.

SEC. 10              Distributor Bequests

Distributors may pass on their interests in their Market America distributorship contracts to their heirs and beneficiaries provided the intended recipient of those interests: (1) has attained the age of majority; and (2) signs and submits an Independent Distributor Application and Agreement, thereby pledging to fulfill the obligations of the Distributor Agreement, including performing management and supervisory responsibilities. Market America must approve all transfers of Distributors contract interests. Market America will require documentation to substantiate the intended recipient’s right to any transfer.  

 

 

Last Modified :09/16/2014 5:34:14 PM EDT