DISTRIBUTOR AGREEMENT USA

Transcription

1 DISTRIBUTOR AGREEMENT USA Amended Distributor ID# 75 W. Center St., Provo, UT Please Fax to PRODUCT PURCHASE AGREEMENT INTERNATIONAL SPONSOR AGREEMENT ARBITRATION AGREEMENT Step 1 New Account Information *Applicant #1 Name Spouse or Co-habitant Name Complete if corporation, partnership, or other legal entity. Name of Business Entity All asterisks (*) fields are REQUIRED. *Applicant #1 Social Security Number Spouse or Co-habitant Social Security Number If spouse or co-habitant name is added to this agreement, spouse or co-habitant SSN field is required. Primary Participant Federal Tax ID Number Please fill out Business Entity Form and submit with this agreement. LANGUAGE PREFERENCE: ENGLISH CHINESE SPANISH KOREAN JAPANESE *Daytime Phone *Evening Phone *Mailing Address *City/State Zip Code *Shipping Address *City/State Zip Code Address *Date of Birth *Sponsor's Name *Sponsor's ID Number Phone Number *Referring Upline Name *Referring ID Number WEB LOGIN USERNAME AND PASSWORD Username (1st Choice) Username (2nd Choice) Password Step 2 Bonus Check Direct Deposit COMMISSION CHECK DIRECT DEPOSIT All my commissions/bonuses will be direct deposited into a checking or savings account. Bank Name Bank Phone Number Please attach a voided check. (REQUIRED) If you do not have a check, please contact your bank for the appropriate document to replace a voided check. This agreement consists of five sections: (A) Definitions, (B) Distributor Agreement and Product Purchase Agreement (which includes the terms of the Automatic Delivery Rewards Program), (C) the International Sponsor Agreement, (D) Mandatory and Binding Arbitration Agreement, and (E) Miscellaneous Provisions. Page 1 of Nu Skin Enterprises USA /17

2 There are three parties to this agreement: Nu Skin Enterprises United States, Inc., Nu Skin International, Inc., and me. The agreement consists of five sections: (A) Definitions, (B) Distributor Agreement and Product Purchase Agreement, (C) the International Sponsor Agreement, (D) Mandatory and Binding Arbitration Agreement, and (E) Miscellaneous Provisions. The Distributor Agreement and Product Purchase Agreement are between Nu Skin Enterprises United States, Inc. and me. The International Sponsor Agreement is between Nu Skin International, Inc. and me. The Mandatory and Binding Arbitration Agreement and Miscellaneous Provisions are between all three parties. A. DEFINITIONS Defined terms are set forth below or may be separately defined in any of the agreements. The meaning of capitalized terms not found in this document is set forth in the Policies and Procedures. Bonuses means the compensation paid to Distributors based on the volume of Nu Skin Products sold by a Distributor, Downline Organization, and breakaway executives as set forth in the Sales Compensation Plan. Digital Business Portfolio means the kit that contains the Policies and Procedures, the Sales Compensation Plan, a Distributor Agreement, and other sales and demonstration materials to assist a Distributor in starting and conducting their independent business. A Digital Business Portfolio is provided to all Distributors free of charge. Contract means the agreement between Nu Skin and me composed of this Distributor Agreement (Section B), the International Sponsor Agreement (Section C), the Mandatory and Binding Arbitration Agreement (Section D), Miscellaneous Provisions (Section E), the Policies and Procedures, the Sales Compensation Plan, and materials pertaining to optional programs, as each may be amended, and are incorporated herein by reference. Wherever the context will so require, all words are deemed to include the plural as well as the singular, and to include all genders. Distributor means an independent contractor authorized by NSEUS to market Nu Skin Products in the United States, recruit other Distributors, and receive Bonuses in accordance with the requirements of the Sales Compensation Plan. Distributor Agreement means this Distributor application and agreement, and if applicable, the Business Entity Form, that must be completed and submitted to NSEUS in order to apply to become a Distributor, the PPA, including the Automatic Delivery Rewards Program section, the Mandatory and Binding Arbitration Agreement (Section D), and the Miscellaneous Provisions (Section E). International Sponsor Agreement or ISA means the International Sponsor Agreement (Section C), Mandatory and Binding Arbitration Agreement (Section D), and the Miscellaneous Provisions (Section E). NSEUS means Nu Skin Enterprises United States, Inc. Nu Skin means NSEUS, Nu Skin International, Inc., and their affiliated companies. NSI means Nu Skin International, Inc. Nu Skin Products means the products and services of NSEUS that are sold in the United States. PPA means the Product Purchase Agreement in Section B. Policies and Procedures means the policies, in addition to the Distributor Agreement, that governs how I, as a Distributor, am to conduct my business and defines the rights and relationships of the parties. Sales Compensation Plan means the specific plan that outlines the details and requirements of the compensation structure for Distributors. B. DISTRIBUTOR AGREEMENT AND PRODUCT PURCHASE AGREEMENT The Distributor Agreement and Product Purchase Agreement, which includes the terms of my participation in the Automatic Delivery Rewards Program, is between Nu Skin Enterprises United States, Inc., a Delaware corporation, 75 West Center Street, Provo, Utah and me. 1. Right to Market Nu Skin Products and Sponsor in the United States Subject to the terms and conditions of the Distributor Agreement, NSEUS grants to me (a) the right to be a Distributor and market Nu Skin Products in the United States through person-to-person sales, and (b) sponsor new Distributors in the United States. 2. Product Purchase Agreement NSEUS will offer to me, as an independent contractor, Nu Skin Products for wholesale purchase in the United States. I have the right to purchase Nu Skin Products at the price stated by NSEUS and agree that NSEUS may change Nu Skin Product prices without prior notice. 3. Independent Contractor I acknowledge and agree that as a Distributor, I am an independent contractor of Nu Skin. As an independent contractor, I will: be self-employed, and determine in my sole discretion, when I work and the number of hours I work; be paid Bonuses based on purchases and sales and not the number of hours that I work be subject to entrepreneurial risk and responsible for all losses that I incur as a distributor; if required, obtain a federal employment identification number; pay my own license fees and any insurance premiums; be responsible for all costs of my business including, but not limited to, travel, entertainment, office, clerical, legal, equipment, accounting, and general expenses, without advances, reimbursement, or guarantee from Nu Skin; not be treated as an employee for federal or state tax purposes; and pay any self-employment taxes required by federal, state, and local laws, statutes, and regulations. I am not an employee, agent, or legal representative of Nu Skin, and except as permitted by the Contract, I am not authorized to act on behalf of Nu Skin. Nothing in the Contract is intended or will be deemed to constitute a partnership, agency, employer-employee, or a joint venture relationship between Nu Skin and me. 4. Marketing of Products and Services (a) I understand that there are no minimum purchases or inventory requirements. I will promote the retail sale of Nu Skin Products in accordance with the terms and conditions of the Contract. (b) I agree not to make any claims about Nu Skin Products and the Sales Compensation Plan unless they are contained on NSEUS labels or in official NSEUS literature. NSEUS will pay me Bonuses for the sale of Nu Skin Products less returns. I understand and agree that, in order to be eligible to receive Bonuses, I must meet all requirements outlined in the Sales Compensation Plan, including retail sales, and not be in violation of the terms of the Contract. (c) I will not purchase any Nu Skin Products solely for the purpose of qualifying for Bonuses. I agree that prior to placing a subsequent product order, I have resold previously ordered Nu Skin Products and documented the sales to at least five retail customers each month, and that I have sold or consumed at least 80% of the Nu Skin Products from any previous orders. (d) I agree to encourage, supervise and assist my Downline Organization s efforts to sell Nu Skin Products to retail customers. 5. Refunds All unopened, resalable Nu Skin Products that are returned within twelve months of the Distributor s order date are eligible for a 90% refund, less applicable Bonuses paid. (Connecticut residents may obtain a 100% product refund for 30 days after submitting the Distributor Agreement). 6. Automatic Delivery Rewards Program ( ADR Program ) (a) If I have specified the type and quantity of Nu Skin Products that I desire to receive each month via the optional Automatic Delivery Rewards Program, these Nu Skin Products will be charged on a recurring monthly basis to the payment form I have provided and will be shipped monthly to my listed shipping address unless I notify NSEUS in writing of any desired changes. (b) NSEUS may change the price of or discontinue the specific Nu Skin Products that I have chosen to receive on an ADR Program enrollment form. In such situations, NSEUS will notify me of the change and will continue to send me, in the case of a discontinued product, the remaining items or in the case of a price change or updated product, the same items I have selected under the ADR Program, at the new price, unless I direct NSEUS to make other arrangements. (c) To pay for each monthly Automatic Delivery order, I authorize NSEUS to establish an automatic credit card debit arrangement as specified on an ADR Program enrollment form. NSEUS will make no other charge to my payment account except those that I have authorized. (Sales tax charges may fluctuate in accordance with changes in applicable sales tax rates). (d) I agree that there are no returns allowed on Nu Skin Products purchased with ADR Program points and that no personal sales volume or group sales volume is earned on Nu Skin Products purchased with ADR Program points. I further agree that applicable sales tax will apply to the redemption of ADR Program points, and that the value of the redemption will be treated as income to me and appear on my IRS Form (e) I agree that if any Nu Skin Products from a qualifying purchase are returned, the balance of the qualifying amount for the month in which Nu Skin Products are returned must be repurchased in order to remain qualified and receive ADR Program points. (f) I understand and agree that NSEUS may terminate the ADR Program at any time and for any reason. NSEUS may also terminate my right to participate in the ADR Program under this Distributor Agreement if (i) the credit card or bank authorization provided expires, is cancelled or otherwise terminated, or (ii) I violate the terms and conditions of this Distributor Agreement. I may cancel my monthly ADR order upon written notice to NSEUS. 7. Bonus Check Direct Deposit (a) I authorize NSEUS to deposit the payment of any Bonuses to my account at the financial institution designated by me. This authorization will remain in full force and effect until (i) NSEUS has received written notice from me of my withdrawal from the direct deposit program, and (ii) NSEUS has a reasonable opportunity to make such a change pursuant to my notice. I understand that this authorization replaces any previous authorization and will remain in effect until NSEUS receives written notice of my withdrawal from the direct deposit program. (b) I agree that I must notify NSEUS immediately (i) prior to changing or closing the above account, or (ii) if my financial institution changes my routing number or account number. Failure to notify NSEUS of account number changes may delay my receipt of Bonuses. If I change my financial institution and/or account number, I must fill out a new Direct Deposit Authorization Form and send it to NSEUS before I close my existing account. (c) NSEUS will not be liable to me for failing to access my account or provide direct deposits to my account in a timely manner unless such failure or loss is a direct result of NSEUS s gross negligence or intentional misconduct. NSEUS s liability will not exceed the amount of the funds that would have otherwise been deposited. C. INTERNATIONAL SPONSOR AGREEMENT The International Sponsor Agreement ( ISA ) is between Nu Skin International, Inc. ( NSI ), a Utah corporation, 75 West Center Street, Provo, Utah and me. The ISA constitutes a separate agreement with NSI. 1. ISA and Right to Sponsor Outside of the United States Under this ISA, NSI grants to me the right to sponsor new distributors in other Authorized Countries outside of the United States. This ISA does not grant me the right to market Nu Skin Products or Nu Skin products and services registered in other Authorized Countries outside of the United States. 2. Laws of Authorized Countries I acknowledge that every Authorized Country may have specific laws and requirements applicable to me as a sponsor of Distributors in that Authorized Country, and I agree to comply with all laws, statutes and regulations of that Authorized Country, including but not limited to, all immigration, visa, and registration requirements. 3. Product Purchases in an Authorized Country other than the United States I agree that I may purchase Nu Skin products and services in an Authorized Country (other than the United States) only from NSEUS s affiliated company designated as the exclusive wholesale distributor in that Authorized Country, and that such affiliated company may require me to execute a separate whole product purchase agreement. I further agree that (i) I may only purchase Nu Skin products and services in an Authorized Country (other than the United States) for personal use or to demonstrate to potential new distributors, and that I will not resell them, (ii) I have not, and will not, either directly or indirectly, sell or distribute any Nu Skin Products or other Nu Skin products or services registered in that Authorized Country, and (iii) I will comply with all applicable laws regarding the purchase of Nu Skin products and services in an Authorized Country. Page 2 of Nu Skin Enterprises USA /17

3 D. MANDATORY AND BINDING ARBITRATION AGREEMENT This Mandatory and Binding Arbitration Agreement is between NSEUS, NSI and me. 1. THIS CONTRACT IS SUBJECT TO ARBITRATION. UTAH WILL BE THE EXCLUSIVE VENUE FOR ARBITRATION OR ANY OTHER RESOLUTION OF ANY DISPUTES ARISING UNDER OR RELATED TO THIS CONTRACT. The place of origin of this Contract is the State of Utah, USA, and it will be governed by, construed in accordance with, and interpreted pursuant to the laws of Utah, without giving effect to its rules regarding choice of laws. The exclusive venue for any and all Disputes will be in Salt Lake County, Utah. I consent to the personal jurisdiction of any courts within the State of Utah and waive any objection to improper venue. 2. I agree that any Dispute will be resolved and settled in accordance with and pursuant to the terms and conditions of this Contract, and by the rules and procedures set forth in Chapter 7 (Arbitration) of the Policies and Procedures or may be viewed online in the My Office section of a company web site. The arbitration proceedings will be conducted in Salt Lake City, Utah. The arbitration will be conducted in the English language, but at the request and expense of a party, documents and testimony will be translated into another language. One arbitrator will be appointed to hear and decide disputes, which arbitrator will be selected by mutual consent of both parties. The parties will each bear their own costs and expenses and an equal share of the (i) cost of the arbitrator and (ii) administrative fees of arbitration. Neither the parties nor the arbitrator may disclose the existence, content, or results of any arbitration without the prior written consent of both parties. Judgment on any award rendered by the arbitrator may be entered in any court having jurisdiction. 3. A Dispute is defined as any and all past, present or future claims, disputes, causes of action or complaints, whether based in contract, tort, statute, law, product liability, equity, or any other cause of action, (i) arising under or related to this Contract, (ii) between other Distributors and me arising out of or related to a Distributorship, or our business relationships as independent contractors of the Nu Skin, (iii) between Nu Skin and me, (iv) related to Nu Skin or its past or present affiliated entities, their owners, directors, officers, employees, investors, or vendors, (v) related to the Nu Skin Products, (vi) regarding Nu Skin s resolution of any other matter that impacts my Distributorship, or that arises out of or is related to the Company s business, including my disagreement with Nu Skin s disciplinary actions or interpretation of the Contract. 4. I AGREE TO ACCEPT AND BE BOUND BY THIS ARBITRATION AGREEMENT IF I ACCESS ANY NU SKIN WEB SITE, AND USE THE INFORMATION THEREIN, OR BY THE PURCHASE OF ANY NU SKIN PRODUCTS MADE AVAILABLE THROUGH SAID WEB SITES, OR THE PURCHASE OF ANY PRODUCTS FROM NSEUS, OR IF I RECEIVE A BONUS. E. MISCELLANEOUS PROVISIONS--REPRESENTATIONS AND WARRANTIES; PERSONAL INFORMATION; ACCEPTANCE; INDEMNITY AND LIMITATION OF LIABILITY 1. Representations and Warranties I represent and warrant that (a) I am authorized to enter this Contract and that I have met all legal requirements to enter into a valid contract in the United States; (b) when executed and delivered by me and accepted by NSEUS and NSI as described herein, the Contract constitutes a legal, valid and binding obligation; (c) the information provided by me in the Contract is accurate and complete and if I have provided any false or misleading information authorizes NSEUS or NSI, at its election, to declare the Contract void from its inception; (d) the social security number or federal tax identification number provided in this Distributor Agreement is my correct tax payer identification number for United States income tax purposes; (e) I, if an individual, am a United States citizen or a lawful permanent resident of the United States or, if a business entity, such as a corporation, partnership, limited liability company, or any other form of business organization, formed in the United States, it is legally formed under the laws of the state in which it was organized and that each member of the business entity has proper legal authorization to conduct business in the United States; and (f) neither I nor my partner/spouse (or if a corporation or other business organization, then any participant therein who is or should be listed on the Business Entity Form) have been engaged in Business Activity in another Distributorship in the six months (one year in the case of those having held an executive equivalent or higher pin-title under the Sales Compensation Plan) immediately preceding my sign up under my Sponsor identified in the Distributor Agreement. 2. Authorization to Transfer Personal Information In order for Nu Skin to provide support for my Distributorship, I authorize Nu Skin to transfer and disclose personal and/or confidential information, which (a) I have provided to Nu Skin in connection with my Distributorship and Downline Organization, or (b) that has been developed as a result of my activity as a Distributor, to (i) its parent and affiliated companies, (ii) and to my Nu Skin independent upline distributors when necessary to ensure proper upline support, and (iii) to applicable government agencies or regulatory bodies if required by law. I further authorize Nu Skin to use my personal information for distributor recognition and marketing materials. 3. Acceptance of Contract by NSEUS and NSI The effective date of the Distributor Agreement and ISA will be the date it is accepted by NSEUS and NSI, which will be (i) the date that I execute the Distributor Agreement and ISA electronically via the company s Internet sign-up procedure and it is received and accepted, (ii) the date that an original hard copy of this agreement is received and accepted and a computer record is made of the account, or (iii) the date a temporary account is set up, and in the discretion or NSEUS and NSI, my subsequent actions indicate an ongoing intent to pursue the business. The temporary account may be terminated by either NSEUS or NSI, at its discretion, if an original hard copy of this agreement is not received and accepted by NSEUS and NSI within thirty (30) days from the date a temporary account is set up. 4. Indemnity and Limitation of Liability (a) Indemnity I will indemnify and hold Nu Skin, and each of their shareholders, officers, directors and employees harmless from and against any claim, demand, liability, loss, action, causes of action, costs, or expenses, including, but not limited to, reasonable attorney s fees, resulting or arising from, directly or indirectly, any acts or omissions by me in conducting my independent Nu Skin business, including without limitation, breach of representations and warranties, material breach of the Contract and other agreements between the parties, or any other claims or causes of action. (b) Limitation of Liability I agree that Nu Skin will not be liable for any special, indirect, direct, incidental, punitive, or consequential damages, including loss of profits, arising from or related to the breach of the Contract or other agreement between the parties. I agree that the entire liability of Nu Skin for any claim whatsoever related to my relationship with Nu Skin, including but not limited to any cause of action arising in contract, tort, or equity, will be limited to the cost of Nu Skin Products that I have purchased from NSEUS. SHIPPING AND HANDLING CHARGES METHODS AND RATES ORDER VALUE SHIPPING SERVICE* SHIPPING RATE METHODS AND RATES ORDER VALUE SHIPPING SERVICE* SHIPPING RATE $0 $49.99 Standard (2-6 days) $5 All Orders Express (1-3 days) Optional Upgrade $12 $50.00 $ Standard (2-6 days) $8 All Orders Premium (1 days) Optional Upgrade. $35 $149 + Standard (2-6 days) FREE I have previously reviewed the Contract, or agree, before conducting any Distributor activity, to do so online at If I refuse to follow any provision of the Contract, I agree to notify NSEUS, in writing, and cancel my Distributorship. If cancelled within the next thirty days, I will receive a refund for products and materials returned in accordance with Paragraph 5 of the Distributor Agreement. I understand that the purchase of any Nu Skin Product, including Automatic Delivery Rewards, is optional and is not required to become a Distributor. If I have elected to participate in the Automatic Delivery Rewards Program, then subject to the terms and conditions of this Contract, I agree that I will (i) receive the quantities of Nu Skin Products I have selected, and (ii) pay for them by the method I have selected. I certify that I am 18 years old and legally able to enter into this Contract (which includes the Binding and Mandatory Arbitration Agreement), and agree to be bound by the terms and conditions of the Contract. *Applicant Signature *Date Spouse or Co-habitant Signature Date Please Fax to Page 3 of Nu Skin Enterprises USA /17

4 POLICIES & PROCEDURES 2017

5 Table of Contents Chapter 1 Your Distributorship 1 1 Becoming a Distributor Applying to Become a Distributor One Individual per Distributorship Age Requirements Minors Legal Residency Former Distributors Spouses and Co-habitants Acceptance of your Distributor Agreement Tax Payer Identification Number Business Entities Changing to a Business Entity Temporary Accounts 2 2 Personal Information Collection of Personal Information Authorization to Use Your Personal Information 2 3 Maintaining Your Distributorship Account Keeping your Distributor Agreement and Business Entity Form current Adding a New Participant Starting a Distributorship under a New Sponsor One Distributorship per Individual Acquisition of Beneficial Interest in and Merger of Distributorships 3 4 Transferring and Terminating Your Distributorship Transferring Distributorships Transfers Upon Death Divorce Right to Terminate 4 Chapter 2 Operating Your Business 5 1 Business Ethics DSA Code of Ethics Purpose of Your Business General Ethics Non Disparagement Harassment No Contact of Vendors or Scientific Advisory Board Members Anti-Corruption Maintaining the Company s Reputation Records Review 6 2 Independent Contractor Distributors are Independent Contractors Taxes No Authority to Act on Behalf of Company Designation as Employer Prohibited 6 3 Ordering Products or Services Ordering Transfer of Title Inventory and the 80 Percent Rule Methods of Ordering Issuing Credits Pricing Changes Submitting Orders in the Name of Another Distributor Payments without Sufficient Funds Use of another Individual s Credit Card Automatic Delivery Rewards Program Retailing of Products 7 4 Product Refunds and Exchanges Refund Policy Exchange Policy for Products Purchased Directly from the Company Procedures for Obtaining a Refund or Exchange 8 5 Retail Sales and Customer Returns Retail Sales No Wholesaling of Products Retail Sales Receipts Money-back Guarantee, Customer Refunds, and Exchanges for your Retail Customers 8 6 Sales Compensation Plan Sales Compensation Plan Exceptions to Sales Compensation Plan No Compensation for Sponsoring No Guaranteed Income Manipulation of Sales Compensation Plan Bonuses Required Retail Sales; Retail Sales Verification Timing Bonus Recovery Payment Corrections 10 7 Product Liability Claims and Indemnification Indemnification Requirements for Indemnification Indemnification by You 10 8 Sales Tax Company Collection of State Sales Tax Exemption from Company Collection of State Sales Tax 11 9 Associating Other Organizations with the Company 11 Chapter 3 Advertising 12 1 Business Support Materials and Trademark Use Use of Business Support Materials Use of Trademarks and Copyrights 12 2 Product Claims General Limitation No Medical Claims No FDA Approved Claims Before and After Photographs Modifications to Product Packaging 12 3 Income Claims No Misleading Income Claims Requirements for Lifestyle and Income Claims 13 4 Blue Diamond Produced Business Support Materials Blue Diamond Business Support Materials No Endorsement or Approval by Company License Agreement for Business Support Materials Registration of Blue Diamond Business Support Materials and Services Sales by Blue Diamonds; Purpose Distributor Organizations 14 5 Mass Media; General Advertising Promotions Utilizing Mass Media Prohibited 14

6 5.2 Media Interviews Phone Book Advertising Distributing Promotional Materials 14 6 Retail Store, Trade Show, and Service Establishment Sales Policy Retail Stores Trade Show Booths Service Establishments The Company s Right of Final Determination 15 7 Internet Use of the Internet in Distributor Business Permitted Internet Activities Blue Diamond Internet Marketing Content Additional Restrictions on Internet Use Internet Video and Audio Internet Selling Spam 17 8 Lead Generation Services; No Speaking Fees Lead Generation Services No Speaking Fees; Meetings 17 9 No Recording of Company Events or Employees 17 Chapter 4 Sponsoring 18 1 Becoming a Sponsor Requirements The Placement of New Distributors Business Portfolio Distribution of Company Leads 18 2 Responsibilities of a Sponsor Training of Downline Organization Line Switching No Purchase of Products or Business Support Materials and Services Required Correct Information on Company Forms Your Downline Organization s Communication with the Company 19 3 International Business International Business Meetings in an Authorized Country with Attendees from an Unopened Country The International Sponsor Agreement China Express Prohibition of Pre-Marketing in Certain Countries Remedies Petition for Permission to Participate No Waiver 20 Chapter 5 Restrictive Covenants 21 1 Ownership of Network 21 2 Restrictive Coveneants Non-Solicitation Exclusivity Confidential Information Confidentiality of Distributorship Information Non-Disparagement Remedies Enforceability 22 Chapter 6 Enforcement of Contract 23 1 The Contract 23 2 Acts of Participants in a Distributorship 23 3 Procedures for Investigation, Discipline and Termination Reports of Alleged Violations Time Limit for Reports of Violations Balance of Rights of Privacy Procedure Distributor Compliance Appeals Committee (DCAC) Company Actions for Breach of Contract Immediate Action Remedies Termination of Your Contract 24 Chapter 7 Arbitration 25 1 What is Mandatory Arbitration 25 2 Arbitration is Mandatory and Binding as to all Disputes 25 3 Definition of a Dispute 25 4 Mediation 25 5 Request for Arbitration 25 6 Arbitration Procedure Rules of Arbitration; Location Discovery Date of Arbitration Language No Class Actions Permitted Attendees Fees and Expenses of Arbitrator Awards Confidentiality Enforcement of Award; Injunctive Relief Survival 26 7 Third Party Claims 26 Chapter 8 General Terms 27 1 General Terms Contract Changes Waivers and Exceptions Integrated Contract Severability Governing Law/Jurisdiction Notices Successors and Claims Headings Internal References Plurality and Gender Translations 28 Addendum A Glossary of Defined Terms 29 Addendum B Policies for Blue Diamond Business Support Materials and Services 32

7 Chapter 1 Your Distributorship 1 BECOMING A DISTRIBUTOR 1.1 APPLYING TO BECOME A DISTRIBUTOR You may apply to become a Distributor by completing the following steps: (a) Complete, sign, and return an online or hardcopy Distributor Agreement to the Company; and (b) Obtain an online digital Business Portfolio. All information on how to complete a Distributor Agreement and obtain a Business Portfolio can be received from your Sponsor. You are not required to purchase any Products or materials to become a Distributor. 1.2 ONE INDIVIDUAL PER DISTRIBUTORSHIP Only one individual may apply for a Distributorship and submit a Distributor Agreement to the Company. If the individual also wants to include a spouse or Co-habitant on the Distributor Agreement, then the spouse or Co-habitant may also be included on the Distributor Agreement. Except for the addition of spouses or Co-habitants, if more than one Person wants to participate in a Distributorship, then the Persons must apply as a Business Entity as set forth in Section 1.10 of this Chapter AGE REQUIREMENTS You must be at least 18 years old to become a Distributor unless you qualify for the limited exception set forth in Section 1.4 below for certain minors. 1.4 MINORS If you are a minor who is at least 16 years old, you may become a Distributor if you submit a hard copy Distributor Agreement signed by you and by your parent or legal guardian. Your parent or legal guardian will be required to supervise your activities. If your parent or legal guardian is a Distributor, then your Distributorship is considered a second account separate from your parent or legal guardian s account; your parent or legal guardian must be your Sponsor; and your parent or legal guardian cannot have any Beneficial Interest in your Distributorship. 1.5 LEGAL RESIDENCY Your Distributor Agreement must be filed and maintained in the country where you are a legal resident or citizen and where you have a legal right to do the business. If you are unable to prove your legal residency, citizenship, or legal right to do business in the country where you have filed your Distributor Agreement, the Company may declare your Distributor Agreement void from its inception. You may only file to be a Distributor in an Authorized Country. 1.6 FORMER DISTRIBUTORS If you have been a Distributor you may only apply to become a new Distributor under your original Sponsor unless you meet the criteria in Section 3.3 of this Chapter 1 for signing up under a new Sponsor. 1.7 SPOUSES AND CO-HABITANTS If the spouse or Co-habitant of a Distributor wants to become a Distributor, the spouse or Co-habitant must be added to the Distributorship previously formed by the other spouse or Co-habitant. If the spouse or Co-habitant of a former Distributor wants to become a Distributor, then the spouse or Co-habitant must apply to become a Distributor under the Sponsor of the spouse s or Co-habitant s former Distributorship unless the applicable inactive period regarding Business Activity of the former Distributor has lapsed as set forth in Section 3.3 of this Chapter ACCEPTANCE OF YOUR DISTRIBUTOR AGREEMENT The Company reserves the right to reject any application for a Distributorship at its own discretion. You become an approved Distributor upon the acceptance and processing of your Distributor Agreement by the Company. In the event the Company gets more than one Distributor Agreement from an applicant, the first Distributor Agreement received at the corporate office is the one that determines who your Sponsor is. 1.9 TAX PAYER IDENTIFICATION NUMBER You will be required to provide the Company with your tax identification number before you are eligible to receive a Bonus, or when otherwise required by the Company for tax or other purposes. This requirement also applies to spouses and Co-habitants who sign the Distributor Agreement. In the event you sign up using a Business Entity, you must provide the tax identification number for the Business Entity and for each Participant in the Business Entity. The Company may also place a sales order or Bonus hold on your account until you provide your tax identification number and your tax identification number has been verified. 1 Your Distributorship 1

8 1.10 BUSINESS ENTITIES A Business Entity may apply to become a Distributor by completing, signing, and returning a Business Entity Form, signed by all the Participants, together with a Distributor Agreement, and purchasing a Business Portfolio. In addition, the following other requirements apply to Business Entities: (a) Each Participant must be a citizen or legal resident and have the legal right to do business in the country where the Business Entity s Distributor Agreement has been filed, and must be able to provide proof of such. If the Business Entity is unable to provide this proof upon the Company s request, the Company may declare the Distributor Agreement void from its inception. You should be aware that merely being listed as a member of a Business Entity does not necessarily grant you any legal right to do business; (b) Bonuses will be issued in the name of the Business Entity. The Company will not have any liability to you if the Business Entity or any Participant in the Business Entity fails to allocate and pay any portion of the Bonuses received by the Business Entity among the multiple Participants in the Business Entity, or for any incorrect allocation and payment; and (c) One Participant will be designated as the Primary Participant of the Business Entity and the Company may rely and act on any information provided by the Primary Participant CHANGING TO A BUSINESS ENTITY If you want to change the form of your Distributorship from an individual to a Business Entity, you may do so at any time. This change is subject to any applicable legal requirements and requires the completion and delivery of a Business Entity Form to the Company TEMPORARY ACCOUNTS When you apply by telephone a temporary account will be established. With a temporary account you must purchase a not-for-profit Business Portfolio with your first order of Products. You may operate a temporary account for up to 60 days. When you have set up a temporary account you are bound by all the provisions of the Contract. You may apply to make a temporary account permanent by submitting a hard copy of the Distributor Agreement to the Company or as provided online. If any temporary account is not made permanent within 60 days, sales order and Bonus holds may be placed on the account. If any temporary account is not made permanent within 90 days, it may be terminated. 2 PERSONAL INFORMATION 2.1 COLLECTION OF PERSONAL INFORMATION The Company is aware of and responsive to your concerns regarding how information about you is collected, used and shared as a result of your becoming a Distributor. Nu Skin respects your privacy and is committed to protecting the privacy of Distributors. The Company collects from you and holds certain personal information about you in order to provide you with support, the benefits of being a Distributor, and communicating with you regarding (i) Products and promotional offers, (ii) your Distributorship and Downline Organizations, (iii) Bonuses, and (iv) other relevant business issues. All information submitted by you will be held by the Company at its corporate headquarters in the United States, its regional headquarters, and/or its local affiliated companies in your Resident Country. You have the right to access and verify your personal information held by the Company by contacting the call center for your Resident Country. 2.2 AUTHORIZATION TO USE YOUR PERSONAL INFORMATION You authorize the Company to: (a) transfer and disclose personal and/or confidential information, which (a) you have provided to the Company in connection with your Distributorship and Downline Organization, or (b) that has been developed as a result of your activity as a Distributor, to (i) its parent and affiliated companies wherever located, (ii) your upline Distributors when the Company determines it is appropriate, and (iii) applicable government agencies or regulatory bodies if required by law. You will have the option to block the transfer of certain information that may be provided to your upline Distributors. (b) use your personal information for Distributor recognition and the Company s Business Support Materials and Services unless you request in writing that the Company not do so. (c) use your personal information described above, and you further agree that any other disclosure of your personal information will be governed by Company s Privacy Policy, as it may be modified from time to time. The Privacy Policy may be viewed on the Company s web site at: 3 MAINTAINING YOUR DISTRIBUTORSHIP ACCOUNT 3.1 KEEPING YOUR DISTRIBUTOR AGREEMENT AND BUSINESS ENTITY FORM CURRENT (a) As a Distributor, it is your duty to keep the information contained in your Distributor Agreement or Business Entity Form current and accurate. You must immediately inform the Company of any changes affecting the accuracy of information contained in these documents. The Company may terminate a Distributorship or declare a Distributor Agreement void from its inception if the Company determines false or inaccurate information was provided. If you fail to update your Distributor Agreement or Business Entity Form, holds may be placed on your account or other disciplinary action may be taken, including termination. 2 Your Distributorship 1

9 (b) You must submit a new Distributor Agreement or Business Entity Form with Amended written across the top to change your Distributorship information. Any amended Distributor Agreement must be signed by you. A Business Entity s amended Distributor Agreement must be signed by the Primary Participant of the Business Entity. An amended Business Entity Form must be signed by all Participants of the Business Entity. The Company may charge a fee for processing changes to the Distributor Agreement and Business Entity Form. The Company may refuse to accept any amendments. 3.2 ADDING A NEW PARTICIPANT You may not allow a Person to engage in any Business Activity for, or have a Beneficial Interest in, your Distributorship, unless your Distributorship is a Business Entity and that Person has applied to become a Participant and such application has been accepted by the Company. The Company may reject any such application in its sole discretion. If the Company rejects the application, the Person may not participate in the Distributorship. 3.3 STARTING A DISTRIBUTORSHIP UNDER A NEW SPONSOR If you are a former Distributor, you may establish a new Distributorship under a new Sponsor only if you have not engaged in any Business Activity (whether for your Distributorship or the Distributorship of another Person) for the indicated inactive period: Account type during the 24 months preceding the most recent Business Activity If you ever achieved Executive or higher Distributor only Inactive Period 12 months 6 months When the Company concludes that an inappropriate Sponsor change has occurred or has been solicited, the second-in-time Distributorship may be returned to and be merged with the first-in-time Distributorship and the Company may pursue other remedies listed in Chapter ONE DISTRIBUTORSHIP PER INDIVIDUAL You are not allowed to have a Beneficial Interest in more than one Distributorship except as follows: (i) marriage of two Distributors who each had a Distributorship prior to the marriage, (ii) inheritance of a Distributorship by an existing Distributor, or (iii) as otherwise approved in writing by the Company. 3.5 ACQUISITION OF BENEFICIAL INTEREST IN AND MERGER OF DISTRIBUTORSHIPS (a) Overview. Occasionally, a Distributor wishes to form a partnership with another existing Distributor and merge the two Distributorships or acquire a Beneficial Interest in a Distributorship. Except as provided in this Section 3.5, the formation of a partnership between Distributors, the merger of Distributorships, or the acquisition of a Beneficial Interest in a Distributorship by a Distributor who has engaged in any Business Activity, is prohibited. (b) Acquisition of Beneficial Interest. Except for those circumstances that may be approved by the Company in its sole discretion, if you have engaged in any Business Activity, you may not, at any time, acquire a Beneficial Interest in a pre-existing Distributorship under a different Sponsor (whether by purchase, merger, partnership, or otherwise) unless (i) you have terminated your Distributorship and had no Business Activity for the applicable inactive period described in Section 3.3 of this Chapter 1, and (ii) the Distributor Agreement for the Distributorship in which you want to acquire a Beneficial Interest was submitted to the Company after the applicable inactive period for your Business Activity as described in (i) above. The prohibitions of this Subsection (b) supersede the provisions of subsection (c) of this Section 3.5. (c) Merger. The Company may, in its sole discretion, consider mergers of Distributorships in the following limited cases: (a) vertical mergers with (i) your immediate upline Sponsor, or (ii) a Distributor that is on your first level; (b) horizontal mergers with another Distributorship, provided that (i) only one of the Distributorships is an Executive or above, and the other Distributorship is not a Demoting Executive, Provisional Executive, Qualifying Executive, or any other similar type of Executive (as defined in the Sales Compensation Plan), and (ii) both Distributorships have the same upline Sponsor; and (c) any other merger as may be approved by the Company in its sole discretion. (d) Company Review and Additional Requirements. In any case involving the proposed formation of a partnership, mergers, or acquisitions of a Beneficial Interest, the Company will, in its sole discretion, decide whether to approve a requested exception to these Policies and Procedures. During its review the Company may impose additional requirements that it deems necessary, including upline notifications and/or approvals. 4 TRANSFERRING AND TERMINATING YOUR DISTRIBUTORSHIP 4.1 TRANSFERRING DISTRIBUTORSHIPS You may not transfer your Distributorship or any rights therein, unless you have received the prior written consent of the Company, which will not be unreasonably withheld. The Company will not consent to any proposed transfer if it determines that the proposed transfer is not substantive and is being done to avoid the requirements of these Policies and Procedures. The Company will not recognize any assignment, and the transferee will have no rights until the transfer has been approved by the Company. Any exceptions and waivers the Company has made to the Contract for the benefit of a Distributorship will terminate upon the transfer unless otherwise provided in a written agreement by the Company. 3 Your Distributorship 1

10 4.2 TRANSFERS UPON DEATH (a) Individuals. Upon your death, your Distributorship may be passed on to your heirs, or other beneficiaries whether by will, intestate succession, or otherwise. The transfer will be recognized by the Company when a court order or proper legal document addressing the transfer to a qualified transferee is submitted to the Company. The Company encourages you to make appropriate arrangements in consultation with an estate-planning attorney for the transfer of your Distributorship. (b) Participant in a Business Entity. If you are a Participant in a Business Entity, upon your death your interest in the Distributorship will be transferred according to the Business Entity s legal documents and applicable law governing the transfer, provided that all Persons of the transferee are qualified to hold an interest in a Distributorship under these Policies and Procedures. The transfer of your interest will be recognized by the Company when a court order or proper legal documents addressing the transfer to a qualified transferee are submitted to the Company. (c) During any time that a Distributorship may be temporarily without an owner, or a gap in ownership occurs due to probate or other court procedures, the upline Blue Diamond or above will be responsible for operating this Distributorship. As payment for their services, the upline Blue Diamond or above will be entitled to a service fee. This fee will be a dollar amount equal to 15 percent of the Distributorship s net Bonuses. 4.3 DIVORCE In the event of a divorce, the Company will neither determine the division of nor divide a Distributorship or a Downline Organization. Generally, the Company will not divide Bonuses or other rewards. The Company may, however, in its sole discretion, on a case-by-case basis, divide Bonuses on a simple, fixed-percentage basis, pursuant to a court order or the written consent of both parties. IF THE COMPANY AGREES TO DIVIDE BONUSES ON A SIMPLE, FIXED PERCENTAGE BASIS, THE PARTIES TO THE DISTRIBUTORSHIP AGREE TO HOLD THE COMPANY HARMLESS FROM ANY AND ALL LIABILITIES, LOSSES, COSTS, DAMAGES, JUDGMENTS, OR EXPENSES, INCLUDING REASONABLE ATTORNEY S FEES, RESULTING OR ARISING FROM, DIRECTLY OR INDIRECTLY, ANY ACTS OR OMISSIONS BY COMPANY IN DIVIDING THE BONUSES. The Company has the right to withhold Bonuses in the event of a dispute among spouses regarding a Distributorship. The Company may charge a fee to Distributors each month as payment for its services in dividing Bonus payments. 4.4 RIGHT TO TERMINATE You may terminate your Distributorship at any time. Please see Section 3.9 of Chapter 6 for details. 4 Your Distributorship 1

11 Chapter 2 Operating Your Business 1 BUSINESS ETHICS 1.1 DSA CODE OF ETHICS The Company is a member of the Direct Selling Association (DSA) in the United States and in many countries around the world and abides by the DSA Code of Ethics. Along with the ethical guidelines of this Section, you must comply with the DSA Code of Ethics in your business operations. The DSA Code of Ethics can be found at PURPOSE OF YOUR BUSINESS The primary purpose of your business and the Company is to sell high quality Products to retail customers. As part of this process you may sponsor other Distributors in the business to build your sales organization. However, the recruitment of other Distributors is not your primary focus, but rather an integral part of your fundamental obligation to sell Products and increase the sales of Products to retail customers by your Downline Organization. 1.3 GENERAL ETHICS You must operate your Distributorship in an ethical, professional, and courteous manner. This means, among other things, the following: You must comply with the Contract and with applicable law. You must operate your Distributorship honestly. You should indicate to prospective customers and Distributors who you are, why you have contacted them, and what Products you are selling. You may not make false or misleading claims about potential earnings under the Sales Compensation Plan or about the benefits of using the Company s Products. You may not pressure any Distributors or prospective Distributors to operate in a financially irresponsible way, including, but not limited to, pressuring them to buy more Products or Business Support Materials and Services than they can reasonably use or sell, or to maintain specific inventory requirements. You must not encourage or recommend that Distributors or prospective Distributors incur debt in order to participate in the business. You must explain how to return Products or cancel an order. You must not represent to prospective Distributors that they are required to purchase Products or Product packages to become Distributors or to become Executives. Prospective Distributors must be informed that they can sign up as customers or that they may purchase Products individually and not in Product packages. 1.4 NON DISPARAGEMENT You may not make any misleading, unfair, inaccurate, or disparaging comparisons, claims, representations, or statements about: the Company; its Products, or commercial activities; other Persons; other companies (including competitors); or other companies products, services, or commercial activities 1.5 HARASSMENT You must operate your Distributorship in a manner that is free of harassment, intimidation, threats, and abuse. Harassment of any kind will not be tolerated, including, but not limited to, race, religion, physical and verbal abuse, or soliciting, encouraging, or consummating any inappropriate or unwelcome written, verbal, electronic or physical relationships, sexual advances, requests for sexual favors, or other physical, verbal, or visual behavior of a sexual nature, with another Distributor, Company employee or customer. 1.6 NO CONTACT OF VENDORS OR SCIENTIFIC ADVISORY BOARD MEMBERS You may not contact, either directly or indirectly, the Company s vendors, suppliers, scientific advisory board members, basic research partners, Universities, or any other advisors or consultants of the Company without the prior written consent of the Company. 1.7 ANTI-CORRUPTION You must comply with all anti-corruption laws, including the Foreign Corrupt Practices Act ( FCPA ), in the countries in which the Company does business. The FCPA requires that you never directly or indirectly (i.e. through an agent) make a payment or gift with the purpose of influencing the acts or decisions of foreign officials. There are some limited exceptions to this rule. Because the rules and exceptions relating to anti-corruption are complex, you should consult with your own legal counsel regarding questions relating to compliance with the FCPA or anti-corruption laws. For additional information please refer to the Company s Anti-Corruption Policy in the Corporate Governance section of the Investors link on the Nu Skin Enterprises, Inc. website at nuskinenterprises.com. 5 Operating Your Business 2