Policies and Procedures Highlights

1. INTRODUCTION

 1.1 In the following, a prospective Distributor (whether an individual, company or partnership) is referred to as you, your, Applicant or Representative. Nu Skin International, Inc., a U.S. corporation with headquarters in Provo, Utah, U.S.A. is referred to as "the Company" including all subsidiaries within the Nu Skin group of companies. The local Nu Skin affiliated company operating in your country of primary residence is referred to as Nu Skin Local.

 1.2 Wherever the Nu Skin business as such (including all activities of all subsidiaries of the Nu Skin group of companies), and neither the Company nor Nu Skin Local is referenced specifically, the collective term Nu Skin is used.

 1.3 For the mutual benefit of your business and the businesses of Nu Skin and its other Distributors, you agree to comply with the following procedures, as amended from time to time. These Policies and Procedures along with the Sales Compensation Plan ("SCP") and the Nu Skin Distributor Agreement form the three party Agreement among the Company, Representative and Nu Skin Local. If you need any help in understanding these procedures, please contact the Nu Skin offices.

2. BECOMING AN INDEPENDENT DISTRIBUTOR

2.1 Provided you are of legal age to conclude an agreement, you may become an independent Distributor in your country of primary residence by receiving a Nu Skin Enterprises Sponsor Pack from a Nu Skin Distributor at our cost price. Once this Agreement has been accepted, you may conduct Distributor Activities in your country of primary residence. Examples of Distributor Activities are:

(i) Placing or paying for wholesale order under any Distributorship with the Company;

(ii) Sponsoring Distributors;

(iii) Selling, gifting, or distributing in any manner, Company products or services, product samples or promotional materials;

(iv) Conducting, sponsoring or inviting potential Distributors to attend an opportunity, product or training meeting; or

(v) Receiving or a promise to receive Bonuses, present or future ownership interest or other consideration from any Distributorship.

2.2 You may become an Executive Distributor and receive additional benefits of an Executive level Distributor by reaching and adhering to the executive qualification requirements outlined in the Annex to this Agreement.

2.3 If you wish to conduct a business in one or more approved countries outside your country of primary residence, you must enter separate distribution contracts and you must be responsible to learn and comply with all applicable laws and regulations of that country. You may purchase Nu Skin products and you may sponsor other persons as Nu Skin Distributors if they are resident in a country the Company has declared open for business (Authorised Country) by signing the Company's and the local affiliate's agreements for the country concerned (details of opened countries can be obtained from Nu Skin). In each such country where you may be accepted, you agree to conduct your business in a lawful and ethical manner and to do nothing to damage the reputation of Nu Skin or its Distributors and customers. The Company and the local Nu Skin affiliate must accept and acknowledge their respective contracts prior to any international activity by the Representative.

2.4 Unless the Company has expressly prohibited all premarketing activities for a certain country (at time of printing, China), you may undertake certain activities prior to the official opening of an Authorised Country. Such activity is limited to providing business cards and conducting, organising or participating in meetings where the number of attendees at any given meeting, including you, does not exceed five. Other activities - such as, but not limited to - marketing and distribution activities of the products or the business opportunity are prohibited unless a special permission from the Company is obtained.

3. THE BUSINESS OPPORTUNITY

3.1 You agree to retail Nu Skin products and to become familiar with those products. You agree to provide personalised retail customer service by conducting your business in an ethical manner. In order to build your business you also need to become familiar with the levels of distributors and the SCP.

3.2 You are self-employed without authority to bind Nu Skin or incur liabilities on its behalf. As an independent business person, you may work in the manner and at the time of your choosing, except as stated in this Agreement. You are responsible for all expenses incurred in carrying on your business, such as tax, VAT and insurance. Nu Skin may require proof that you are properly registered as an independent contractor in order to pay out commissions.

3.3 Upon sale to any customer you must provide and adhere to the terms of a retail receipt approved by Nu Skin.

3.4 You are neither guaranteed a specific income nor assured any level of profit or success. Your profit and success can come only through the successful retail sale of Nu Skin Products and retail sales of your sales organisation. The Company agrees to pay you commissions for sales, as set out in the current edition of the SCP, made by persons directly or indirectly introduced by you in any country the Company has declared open for business and in which you are authorised to do business. You agree to accept payment from the Company or its paying agent in your country of primary residence as verified by your proof of identity.

3.5 You will not receive compensation for merely sponsoring or introducing other Distributors to the Nu Skin business. Commission statements outlining the compensation you earn will be provided to you on a monthly basis. The statements will also include a list of Distributors in your sales organisation. This list is the property of the Company, licensed to Nu Skin Local; it is sub-licensed to you for your personal business use. It is confidential; you may not copy or transfer it to any third party. If misused, Nu Skin Local may request all statements be returned. You must return the complete list to Nu Skin upon request. Any amount Nu Skin owes to you may be offset against an amount you owe to Nu Skin, as outlined in the product returns section of this document.

3.6 You are not granted any territorial exclusivity.

4. YOUR AGREEMENT

4.1 This Agreement is personal to you and may not be assigned or otherwise transferred to a third party without the Company's and Nu Skin Local's written consent. You may not participate in or receive income from more than one Nu Skin distributorship at any time. You may not have participated in or received an income from any Nu Skin distributorship during the previous six months (or one year if previously an Executive Distributor).

4.2 Only one distributor agreement may be in force in each household. If a distributorship is held jointly by two or more persons (whether a partnership or marriage/cohabitant) they are agreed to be partners and to have joint and several responsibility to Nu Skin for their actions. Unless another course is agreed among all joint Distributors (partners or spouses/cohabitants) and Nu Skin, the distributorship will come to an end if the partnership or marriage terminates.

4.3 You may establish a distributorship under a different Sponsor only under one of the following circumstances: (A) If you have held an executive or higher pin-level within the prior two years, you must have not engaged in "Distributor Activity" for the one-year period prior to establishing a new distributorship; (B) If you did not hold an executive or higher pin-level within the prior two years, you must have not engaged in Distributor Activity for a six-month period prior to establishing a new distributorship. If you were previously engaged in Distributor Activity under a different Sponsor, you may not at any time acquire an interest or merge with a preexisting distributorship under a different Sponsor. You may not have or acquire a present or future ownership interest in or establish another Distributorship in the name of a family member or an unrelated individual.

4.4 You may not under any circumstances encourage, entice, or otherwise assist another Distributor to transfer to a different Sponsor.

4.5 You may not solicit or entice another Distributor whom you have not sponsored to sell or purchase products or services other than those offered by Nu Skin.

4.6 In the event the Company concludes that an inappropriate line switch has occurred you may be penalised and the second-in-time distributorship shall be returned to and be merged with the first-in-time distributorship. The Company may also impose penalties on any distributorship that solicits or entices an existing Distributor to change lines of sponsorship.

4.7 You agree that the personal data specified in the Agreement, as well as personal data collected in the performance of the Agreement, is necessary for Nu Skin to operate and coordinate the Nu Skin distribution network, and that the provision of such information is a condition of a Distributor's membership to this network. The data collected is used by Nu Skin's internal or external departments which take part in the management of Nu Skin's network. It may be transferred to other Distributors [pursuant to the provisions of these Policies and Procedures]. You may have access to the personal data relating to yourself and have it corrected if it is incorrect.

5. YOUR OBLIGATIONS

5.1 You are personally responsible to know and comply with all national, state, municipal and local laws and you agree to undertake such training necessary to enable you to conduct your business lawfully, ethically, effectively and in compliance with these Policies and Procedures.

5.2 You may not in any event act in the name of or bind the Company.

5.3 You agree to comply with the Codes issued by the local and multi-national Direct Selling Associations (Federation for European Direct Selling Associations [FEDSA] and World Federation of Direct Selling Associations [WFDSA] of which the Company is a member. The Codes are available to view on the Associations' websites: www.fedsa.be and www.wfdsa.org.

5.4 You agree to keep proper business records showing sales verification and keep them available for review by the Company if ever requested. You agree to give the Company immediate notice of any change to your personal details on the Distributor Agreement form or other documents.

5.5 You agree not to make any misleading, exaggerated or false claims about the business opportunity available through the Company. Before sponsoring you agree to undertake such training necessary to enable you to sponsor and to provide proper support to persons you sponsor. You may not use unfair, deceptive or misleading recruiting practices. Any sales or earning representations must be based upon documented facts printed in sales materials published by the Company.

5.6 You agree not to make any misleading, exaggerated or false claims about the products and not to describe the products in terms differently from those set out in the current Company literature. In particular you may not ascribe any medicinal claims to any of the products.

6. ADVERTISING THE BUSINESS OPPORTUNITY AND THE PRODUCTS

6.1 Any resale of products may only be made by the direct selling method, not through retail premises. Sales may be made through service establishments, which earn revenue primarily by providing personal services - these include offices of health professionals, health clubs, beauty shops, nail boutiques, spas, and other such businesses controlled by membership or appointment. Company name/logos or products may however not be displayed where they may be viewed by persons passing by.

6.2 You may not use the trade names or any trademarks of the Company (except for the purposes of product identification) without the prior written approval of the Company. You agree that the Company trade names and trademarks are the property of the Company and you agree not to infringe them in any way. When promoting the business opportunity or products you agree to use only literature or other aids sold through Nu Skin Local or sales aids approved by the Company.

6.3 Company literature is protected by copyright and may not be reproduced without written approval.

6.4 You may not advertise either the Products or the business opportunity unless you have first obtained the Company's written approval.

6.5 You may not repackage, change the packaging or labels or in any other way alter the products supplied by the Company before their resale to customers. You also agree to resell them only in the country for which they are labeled in accordance with local law and approved for sale. You may not for any reason, directly or indirectly, import any product or sales aid into any unauthorised country or territory. If you wish to sell products outside your country of primary residence you should contact the Company for further information.

6.6 You may not use business cards or other personalised Sales Aids containing Company trade names or logos unless produced by the Company or expressly approved of by the Company.

6.7 You must only use Company produced Distributor web sites, Corporate sites, and web tools (i.e., Dynamic Web Pages, Global Web Pages, E-clips, etc.) when promoting the Company's products and services over the Internet. Additionally, you are permitted to create generic business opportunity sites and/or generic splash pages with links to Company sites or a Business Centre/GWP. These generic pages may not contain the Company's trademarks or other copyrighted material and may not contain information on the Company, its products or its business, or pictures of products or corporate facilities/personnel. Except as set forth in this policy, you may not use the Internet to promote the Company, including its products and services, in any other manner. In case of a violation, the Company may require you to immediately remove the web site that is in violation of Nu Skin's policies, in addition to taking other disciplinary actions against you in accordance with Section 9 of these Policies and Procedures. Your web sites are also subject to the following restrictions:

(i) If you have previously attained and currently enjoy active status as a Blue Diamond/Presidential Director you may create your own independent Internet sites to promote the Company's products/services and business opportunity. However, all such sites, and any changes thereto, must first be reviewed and approved as Sales Aids in accordance with Section 6.6 of these Policies and Procedures and carry a Company designated review seal. Changes made to the site after obtaining the initial review seal requires written authorisation from a representative of the Distributor Conduct Department.

(ii) You may not include any intellectual property or proprietary information in the unique domain names/URL or meta-tags of your Company produced or generic business opportunity web sites. Additionally, intellectual property and proprietary information cannot be used as "wallpaper" on any Company hosted or generic business opportunity site.

(iii) You may not register your web sites with search engines or web directories using any intellectual property any proprietary information.

(iv) You are required to promote your Company hosted and/or generic business opportunity Internet sites through one-onone personal contact only. Additionally, you are prohibited from forwarding information regarding your sites to individuals who have not specifically requested information regarding the Company's business opportunity and/or products (i.e., spam).

7. PRODUCT ORDERS, SALES, RETURNS

7.1 You may order products for resale from Nu Skin Local pursuant to its current terms of sale for distributors and in other countries where you are authorised to do business in accordance with local requirements.

7.2 Nu Skin Local agrees to use its reasonable efforts to meet your orders promptly on receipt of payment, subject to availability of stock. Nu Skin Local reserves its right to change the prices, range and specifications of products at its discretion.

7.3 Nu Skin Local reserves the right to refuse to supply you if in its opinion you are holding or seeking to hold excessive stock. You agree not to have on hand more than a reasonable supply of products, meaning an amount you can reasonably sell or use in a one-month period. If in the opinion of the Company, you are buying and returning Products merely to maintain your Executive status level, the Company may at its discretion change your distributor title to reflect the level of your activity as set forth in the SCP.

7.4 Respecting your wholesale purchases from Nu Skin Local the following apply:

(i) Nu Skin Local agrees to exchange for new products at its cost any defective product or product damaged during delivery, provided you give Nu Skin Local written notice within 90 days from the purchase date.

(ii) Nu Skin Local agrees to refund 90% of the wholesale purchase price (less VAT, commissions and other benefits relating to that purchase) for any product (except personalised sales aids) you return within twelve months from the purchase date. For all refunds you need to obtain a Return Merchandise Authorisation (RMA) number. You will return the product at your cost to Nu Skin Local in a resaleable as new condition.

7.5 Respecting sales to retail customers, the following apply:

(i) You agree to comply with local law on cancellation of sales as outlined on the retail receipt. If the law grants additional rights, you agree to know and grant those rights to the retail customer. You must refund the entire purchase price including VAT to the retail customer.

(ii) Nu Skin Local agrees to exchange any product you receive back from a retail customer, provided you 1) give notice to Nu Skin Local within 90 days from the retail purchase date; 2) you obtain from Nu Skin Local an RMA number and you give to Nu Skin Local the retail receipt showing the particulars of the retail sales transaction: and, 3) you return at your cost the unused portion of the product to Nu Skin Local.

8. PRODUCT LIABILITY COVERAGE

8.1 The Company will cover you for claims arising from the use of products.

8.2 Distributors who may be party to the claim because of selling the product to the consumer will be covered by the Company within reasonable limits.

8.3 You are covered by the Company only if you market products in accordance with these Policies and Procedures and in accordance with the Company's instructions how to use and market the specific product. Hence, your coverage may be denied by the Company if you repackage or alter the products, are negligent, or make inappropriate product claims.

9. CONTRACT BREACH

9.1 If a Distributor has violated any of the terms or conditions of the agreement, the Company may elect, at its discretion, to terminate the Agreement or to impose sanctions in one or more of the following ways, without limitation:

(i) Written warning advising that further violation may result in further sanctions;

(ii) Probation, which may include requiring you to take remedial action. The Company may review compliance with this Agreement;

(iii) Withdrawal or denial of an award, denying recognition in Company publications, or restricting participation in Company sponsored events for a specified period of time or until certain conditions are satisfied;

(iv) Suspension of certain privileges, including but not limited to placing an order, participating in Company programmes, progressing in the SCP, or participating as a sponsor;

(v) Withholding of commissions for a specified period of time or until certain conditions are satisfied;

(vi) Imposing fines or other penalties permitted by law;

(vii) Injunctive relief or other remedies available by law.

9.2 The following procedure applies when the Company investigates a violation or other complaint or request for mediation:

(i) The Company will send a formal written notice of its intent to impose sanctions for a violation.

(ii) The Company will give you twenty (20) days from the date of dispatch of the notification letter to present your case for review by the Distributor Conduct Review Committee (DCRC).

(iii) On the basis of any information obtained from collateral sources, from the Company's investigation of the facts or from your response, the Company will make a decision regarding the appropriate sanction, which may include termination of the agreement. The Company reserves the right to impose sanctions for violations of the Agreement on a case-by-case basis. The Company will promptly notify you of its decision. Any sanction will be effective from the date the notice is dispatched.

(iv) Representative may appeal the decision to an Internal Appeals Review.

(v) Any dispute or claim arising from this Agreement not resolved by the above procedure shall be submitted to mediation in Utah, USA and failing a satisfactory result from mediation a continuing dispute shall be settled by binding arbitration in the same location.

10.INDEMNITY

10.1 You agree to indemnify the Company against any liability it may incur as a result of your breaching any provision of your Distributor Agreement. The Company will not be liable for any damages (including consequential damages) of the Distributor arising out of the termination of the Agreement by the Company.

11.EARLY TERMINATION

11.1 You have the right without penalty within 14 days of entering into this Agreement to cancel it with immediate effect by giving written notice to either company in which case you have the right:

(i) To recover any monies which you have paid to or for the benefit of either company or any Distributor in connection with your participation in this selling system or paid to any other Distributor in accordance with the provisions of this selling system; and

(ii) To return to Nu Skin Local any goods which you have purchased within that period under this selling system and which remain unsold provided that such unsold goods remain in the condition in which they were in at the time of purchase (except their external wrappings may have been broken) and to recover any monies paid in respect of such goods; and

(iii) To cancel any services which you have ordered within that period under this selling system and to recover any monies paid in respect of such services not yet supplied to you.

11.2 In order to recover any monies under (i) or (iii) above you must give written notice requesting the repayment of such monies to Nu Skin Local within 14 days of entering into this Agreement and Nu Skin shall repay you such monies as you may be legally entitled to recover within a reasonable period of time after the date of receipt of such notice.

11.3 In order to recover monies paid for goods under (ii) above, you must deliver the goods to Nu Skin Local within 14 days of entering into this Agreement to Nu Skin Local's address. You shall bear the cost of such delivery. The monies paid in respect of those goods is payable to you on delivery of the goods, or forthwith if the goods have not yet been delivered to you.

11.4 The Company is not entitled to make a handling charge in respect of goods returned under (ii) above or services cancelled under (iii) above.

12.TERMINATION

12.1 You may terminate this Agreement whenever you wish without charge simply by giving written notice to either company to that effect. The Company may terminate this Agreement at any time if you break its terms and otherwise by either Company giving you not less than 10 days written notice.

12.2 If the Company terminates this Agreement, or if you terminate it after 14 days of entering into it, then you have the following rights:

(i) Subject to any provisions of this Agreement containing an obligation on your part not to compete with the business of the Company after the termination of this Agreement, which provisions shall continue in force after termination of this Agreement, you shall be released from all future contractual obligations;

(ii) The Company will refund 100% of the price, less applicable Bonuses and a handling fee of 10%, (plus applicable tax if prepaid) on reasonably sound, unopened, unaltered, resaleable, and restockable products and Sales Aids (unless personalised) produced and sold by the Company that are returned within twelve months of the order date by the Distributor who purchased the products or Sales Aids from the Company. In order for the Company to correctly back out the applicable Bonuses on returned products, it is critical that the original sales order number from the invoice be retained. This number must be provided to the Company at the time the request for a refund is made. Products otherwise sold individually but purchased as part of a kit or package may be returned if the product is current, unopened, and resaleable. Acceptable refund alternatives include but are not limited to the following: Company credit, bank check, bank transfer, or credit card charge back. The actual form of refund will be based upon local payment procedures and the original form of payment.

(iii) The amount recoverable by you under this Section is payable by the Company upon delivery of the goods to Nu Skin Local or, if the goods are already held by Nu Skin Local, forthwith; and

(iv) If you wish to exercise your rights under this Section you must deliver any goods (not already held by Nu Skin Local) which you wish to return within 21 days of such termination to Nu Skin Local. You shall be reimbursed by the Company for the costs of such delivery.

12.3 On termination of this Agreement for whatever reason you shall be entitled to retain any commission paid to you in accordance with this Agreement unless:

(i) The commission was paid in respect of goods returned to Nu Skin Local (or another distributor who paid the commission); and

(ii) The Company has refunded any monies due to you in accordance with the termination provisions of this Agreement set out above; and

(iii) Repayment of the commission is claimed by the Company, in which case you shall repay such commission to Nu Skin Local forthwith on demand or either company may set-off the amount of such commission against any amounts due from either company to you.

12.4 The rights set out in this Section of this Agreement are given to you by statute and are in addition to the rights on termination that are given to you under these Policies and Procedures.

13.MISCELLANEOUS

13.1 This Agreement is governed by the law of the jurisdiction under which Nu Skin Local exists as a company. If any provision of the Agreement is held by any court to be unlawful, void or unenforceable that shall not affect any of the other provisions of the Agreement the remainder of which shall continue to be binding.

13.2 Any notice given under this Agreement shall start to run from the day it is posted to the addressee at their address set out on the application portion of this Agreement, or posted to any replacement address which has been notified.

13.3 This Agreement comprises the terms set out in the documents making up this Agreement; there are no oral terms, your sponsor is not authorised to vary them and they may be amended in writing only.

13.4 If you are named as a defendant in any action relating to activities arising from the terms of this Agreement, the Company may, in its sole discretion, assume power over and direct the litigation and Representative agrees not to dispute such action by the Company.

13.5 The Company reserves the right to modify any of these documents, but will publish notice of any change at least thirty days before that change is made effective.

13.6 This document is available in several languages. If, for any reason, there are discrepancies in the translation, the English version shall prevail.

ANNEX

Building Your Business

As a Distributor, when building your business organisation, you agree to train and support Distributors you sponsor and those in your sales organisation. You agree to perform the following activities for your sales organisation:

• Give regular retail sales and organisational training, guidance and encouragement;
• Maintain contact with members of your organisation and be available to answer their questions;
• Use your best efforts to ensure your organisation properly understands and complies with all the terms of their agreement with Nu Skin and the laws which apply to the conduct of their business in the country where they are operating;
• Intervene in any dispute between a customer and any member of your organisation and attempt to resolve the dispute promptly and amicably;
• Ensure product sale and business opportunity meetings conducted by members of your organisation are conducted in accordance with their agreement with Nu Skin and with the laws which apply to their business.

You may become an Executive and receive additional benefits of an Executive level Distributor by reaching and adhering to the executive qualification requirements outlined in the current Sales Compensation Plan Booklet. As an Executive Distributor you will be responsible for the management of your sales organisation. Upon reaching the level of Executive Distributor, you agree to fulfil the following activities generally, along with the specific activities outlined for the associated level.

Executive Activities

• Perform all the activities of a Distributor
• Build a retail marketing team by teaching and training others how to use, and retail NS Products
• Assist in training other Distributors to build a solid and profitable retail sales base
• Create a balance between servicing retail customers and Distributor training

Gold Executive Activities

• Perform all the activities of an Executive
• Develop a retail marketing team that focuses on providing quality service to customers, training and supporting part-time retail Distributors who are seeking supplemental income
• Train and support distributors who are committed to building a retail organisation resulting in a greater degree of financial success
• Train at least one person in your sales organisation to become an Executive
• Motivate and support other distributors to become Executive Distributors
• Assist other Distributors in setting and achieving goals
• Assist other Distributors with developing an effective NS sales presentation
• Establish retail sales teams among downline Distributors

Lapis Executive Activities

• Perform all the activities of a Gold Executive
• Develop, train, assist and support a minimum of two Executive level Distributors in your organisation
• Hold weekly team meetings to discuss current developments, motivate Distributors, increase product knowledge, and train the organisation on how to be more effective
• Track the success of your two Executive level Distributors by reviewing their effectiveness in retail training, goal setting, customer development and service and sales presentations
• Assist your two Executive level Distributors to grow personally and develop leadership skills
• Assist those Distributors in their training efforts by identifying and supporting any potential Executive level candidate in their organisation
• Strive to possess the skill to teach others how to duplicate their success

Ruby Executive Activities

• Perform all the activities of a Lapis Executive
• Develop, train and support at least four Executive level Distributors in your organisation
• Provide leadership within your organisation
• Train your four Executive level Distributors to hold meetings with the Distributors in their respective organisations to assist in goal setting, prospecting retail customers, business tips, current market trends, and becoming an Executive
• Develop upper level training and sales programmes

Emerald Executive Activities

• Perform all the activities of a Ruby Executive
• Develop, train and support a minimum of six Executive level Distributors within your organisation
• Develop weekly and monthly team meetings to identify and train potential Executive level Distributors
• Develop the ability to understand marketing principles and build sales organisations
• Assist the Executives in your organisation in setting up their own distribution organisations
• Provide support in the personal development of those within the retail sales organisation
• Provide the Distributor organisation with up-to-date knowledge and technical understanding of the Products and their use

Diamond Executive Activities

• Perform all the activities of an Emerald Executive
• Develop, train and support a minimum of eight Executive level Distributors within your organisation
• Assist the organisation to expand
• Hold regular product training and sales meeting for those within your organisation

Blue Diamond Executive Activities

• Perform all the activities of a Diamond Executive
• Develop, train and support a minimum of twelve Executive level Distributors within your organisation
• Plan, develop and hold regular meetings and conferences
• Hold regular meetings with the leaders in the organisation
• Create business strategies to support and promote regional distribution organisations
• Be informed about and respond to current market trends and factors affecting your organisation