Form Of Wholesale Distribution Agreement

This is the form of Wholesale Distribution Agreement for Nu Skin USA, Inc. and the other North American Private affiliates. Payments are paid in the local currency of the country in which the private affiliate operates)















Nu Skin International, Inc.

Nu Skin USA, Inc.



WHOLESALE DISTRIBUTION AGREEMENT















TABLE OF CONTENTS





ARTICLE I DEFINITIONS....................................................2

1.1 "Agreement"....................................................2

1.2 "Independent Distributor Network"..............................2

1.3 "Intercompany Agreements"......................................2

1.4 "NSI Independent Distributor"..................................2

1.5 "NSI"..........................................................2

1.6 "Products".....................................................2

1.7 "Sales Aids"...................................................3

1.8 "Territory"....................................................3

1.9 "Trademarks"...................................................3



ARTICLE II APPOINTMENT AS EXCLUSIVE WHOLESALE DISTRIBUTOR.................3

2.1 Scope..........................................................3

2.2 Sub-distributors...............................................3

2.3 Sales of Products and Sales Aids...............................3

2.4 NSI Sales in the Territory.....................................4

2.5 Sales Outside the Territory....................................4

2.6 Territory Orders and Inquiries.................................4



ARTICLE III GOVERNMENTAL APPROVALS AND REGISTRATIONS.......................5



ARTICLE IV OBLIGATIONS OF NSUSA AS EXCLUSIVE WHOLESALE DISTRIBUTOR

IN THE TERRITORY...............................................5

4.1 Marketing and Distribution.....................................5

4.2 NSUSA Operations...............................................6

4.3 Pricing Information............................................7

4.4 NSUSA Claims and Representations...............................7

4.5 Capitalization.................................................7

4.6 Customer Support...............................................7

4.7 Allocation of Expenses.........................................7



ARTICLE V PURCHASE SALE & DELIVERY OF PRODUCTS AND SALES AIDS............8

5.1 Agreement to Purchase..........................................8

5.2 Payment Due Date...............................................9

5.3 Passage of Title and Risk of Loss..............................9

5.4 Product Returns/Exchanges Inspection...........................9



ARTICLE VI PRODUCT AND SALES AIDS PURCHASE PRICES AND TERMS OF PAYMENT...10

6.1 Product Availability and Pricing..............................10

6.2 Payment Method................................................10



ARTICLE VII OBLIGATIONS OF NSUSA AS SUPPLIER OF PRODUCTS AND

SALES AIDS....................................................11









7.1 Product Formulation...........................................11

7.2 Warranty......................................................11

7.3 Delivery......................................................11



ARTICLE VIII SALE AND MANUFACTURE OF PRODUCTS..............................12

8.1 Non-Competing Products........................................12

8.2 Competing Products............................................12

8.3 Discontinued Products.........................................12



ARTICLE IX NATURE OF RELATIONSHIP........................................13



ARTICLE X TERM..........................................................13



ARTICLE XI TERMINATION...................................................13



ARTICLE XII EFFECT OF TERMINATION.........................................15



ARTICLE XIII CONFIDENTIALITY...............................................16



ARTICLE XIV INDEMNIFICATION AND INSURANCE.................................17



ARTICLE XV MISCELLANEOUS 19

15.1 Assignment....................................................19

15.2 Notices.......................................................19

15.3 Waiver and Delay..............................................20

15.4 Force Majeure.................................................20

15.5 Governing Law and Dispute Resolution..........................21

15.6 Integrated Contract...........................................21

15.7 Modifications and Amendments..................................22

15.8 Severability..................................................22

15.9 Counterparts and Headings.....................................22











WHOLESALE DISTRIBUTION AGREEMENT



THIS WHOLESALE DISTRIBUTION AGREEMENT (hereinafter "Agreement") entered into and made effective this 31st day of December, 1997 (the "Effective Date"), by and between Nu Skin U.S.A., Inc., a corporation organized under the laws of the State of Delaware, U.S.A., (hereinafter "NSUSA"), and Nu Skin International, Inc., a corporation organized under the laws the State of Utah, U.S.A., (hereinafter "NSI"). Hereinafter, NSUSA and NSI collectively shall be referred to as the "Parties."

W I T N E S S E T H



WHEREAS, NSI is engaged in the design, production and marketing of Products and Sales Aids (as hereinafter defined) for distribution in markets through a network of independent distributors; and,



WHEREAS, NSUSA desires, on the terms and conditions hereinafter set forth, to act as NSI's exclusive distributor of NSI of Products and Sales Aids in the Territory (as hereinafter defined); and,



WHEREAS, NSI is willing, on the terms and conditions hereinafter set forth, to grant to NSUSA the exclusive right to so distribute Products and Sales Aids in the Territory; and,



WHEREAS, the Parties wish to enter into a Wholesale Distribution Agreement as set forth herein; NOW, THEREFORE, in consideration of the premises, the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I



For the purposes of this Agreement the following words, terms, and phrases shall have the meaning assigned to them in this Article I, unless the context otherwise requires or the parties otherwise agree within the terms of this Agreement: 1.1 "Agreement" shall mean this Wholesale Distribution Agreement between NSI and NSUSA (together with any exhibits and schedules hereto), as the same may be modified, amended or supplemented from time to time.



1.2 "Independent Distributor Network" shall mean the network of all NSI Independent Distributors.



1.3 "Intercompany Agreements" shall mean the Wholesale Distribution Agreement, The Licensing and Sales Agreement, The Management Services Agreement and the Trademark/Tradename Agreement between the Parties.



1.4 "NSI Independent Distributor" shall mean a person or business entity authorized by contract with NSI to distribute, as an independent contractor, the Products and Sales Aids in accordance with the terms of such distributor contract.



1.5 "NSI" shall mean Nu Skin International, Inc., a corporation duly organized and existing under the laws of the State of Utah, U.S.A.



1.6 "Products" shall mean cosmetics, nutritional products, dietary supplements, vitamins, over-the-counter drugs, quasi-drugs, drugs and pharmaceutical products that are produced, manufactured or purchased by NSI for sale or resale, and bearing a Nu Skin brand or trademark existing as of the date hereof, subject to availability due to local regulatory requirements in the Territory.

1.7 "Sales Aids" shall mean materials, in whatever form, designed, approved and produced by NSUSA to assist in the marketing of the Products in the Territory.



1.8 "Territory" shall mean the United States of America including all its territories.



1.9 "Trademarks" shall mean those words, symbols, devices, logos, trade names and company names or combinations thereof owned by NSI and used in relation to or on Products and Sales Aids, whether or not registered.



ARTICLE II

APPOINTMENT AS EXCLUSIVE WHOLESALE DISTRIBUTOR



2.1 Scope. NSI hereby appoints NSUSA as NSI's exclusive distributor, during the term of this Agreement, for the sale and distribution of Products and Sales Aids in the Territory, under the Products' names, logos, and Trademarks, subject to all terms and conditions of this Agreement, and NSUSA hereby accepts such appointment and authorization.



2.2 Sub-distributors. Except for the sale of Products and Sales Aids to NSI Independent Distributors, NSUSA shall not, without the prior written approval of NSI, appoint sub-distributors or agents to promote or distribute Products or Sales Aids inside or outside the Territory.



2.3 Sales of Products and Sales Aids.



2.3(a) NSUSA agrees that any distribution of Products or Sales

Aids in the Territory shall be made only to NSI Independent



2.3(b) To facilitate sales to NSI Independent Distributors,

NSUSA shall have the right to access information regarding such NSI

Independent Distributors in the Territory on NSI's computer system or

as otherwise retained by NSI .



2.4 NSI Sales in the Territory. NSI agrees not to sell and, to use its best efforts to prohibit any third party from selling Products or Sales Aids to any party within the Territory or to any party outside the Territory for delivery within the Territory, except to NSUSA pursuant to the terms and conditions of this Agreement, unless NSI has received the written consent of NSUSA. Notwithstanding the foregoing, NSI retains the right to license to other entities the use of the Independent Distributor Network for distribution of products other than those included in the definition of Products in Section 1.5, without the consent of NSUSA.



2.5 Sales Outside the Territory. NSUSA agrees that it will neither sell nor enable any third party to sell Products or Sales Aids outside the Territory or sell Products or Sales Aids to any party within the Territory for resale or delivery outside the Territory. Further, NSUSA shall not promote or solicit customers for Products or Sales Aids sales outside the Territory. NSUSA shall not establish any facility outside the Territory through which orders are solicited or in which inventories of Products or Sales Aids are stored without NSI's written consent.

2.6 Territory Orders and Inquiries. The Parties acknowledge that from time to time inquiries and orders concerning the Territory will arise. If NSI receives any order or inquiry concerning the sale of Products or Sales Aids in the Territory, NSI agrees to give prompt notice of such inquiry or order to NSUSA, such notice to include the name and address of the person making the order or inquiry as well as any other relevant details regarding such order or inquiry that NSUSA shall reasonably request. If NSUSA receives any order or inquiry concerning the sale of Products or Sales Aids outside the Territory, NSUSA agrees to give NSI prompt notice of such inquiry or order, such notice to include the name and address of the person making the order or inquiry, as well as any other relevant details regarding such order or inquiry that NSI shall reasonably request.



ARTICLE III

GOVERNMENTAL APPROVALS AND REGISTRATIONS



NSUSA agrees to obtain, or cause to be obtained, at its sole cost and expense, any governmental approval and make, or cause to be made, any filings or notifications required under all applicable laws, regulations and ordinances of the Territory to enable this Agreement to become effective, to enable the Products or Sales Aids to be imported in the Territory (except as otherwise provided herein) or to enable any payment pursuant to the provisions of this Agreement to be made. NSUSA agrees to keep NSI informed of the progress in obtaining all such government approvals.



ARTICLE IV

OBLIGATIONS OF NSUSA AS EXCLUSIVE WHOLESALE

DISTRIBUTOR IN THE TERRITORY



4.1 Marketing and Distribution. NSUSA shall have the following obligations with respect to marketing and distribution of the Products and Sales Aids:



4.1(a) To use its best efforts to further the promotion,

marketing, sales and other distribution of the Products and Sales Aids

in the Territory.

4.1(b) To maintain, or cause to be maintained, an adequate and

balanced inventory of Products, Sales Aids, supplies and necessary

materials to promote, market, sell and distribute the Products and

Sales Aids within the Territory.



4.1(c) To ensure that all inquiries by NSI Independent

Distributors and customers, including complaints are responded to

promptly. To ensure that all orders are processed and all shipments of

Products and Sales Aids are made within the Territory in a timely



4.1(d) To diligently investigate or cause to be investigated

all leads with potential customers referred to it by NSI or NSI, or

their affiliates.



4.1(e) To permit NSI to visit NSUSA and to visit NSUSA's place

of business and inspect its inventories, service records, financial

records and other relevant documents.



4.1(f) To maintain, cause to be maintained, or contract to

maintain, adequate personnel, distribution and laboratory facilities

dedicated on a full-time or part-time basis to the quality control and

sale of Products, in compliance with and to the extent required by all

laws, ordinances and regulations applicable within the Territory.



4.1(g) To provide, at the request of NSI, a business plan for

the term and in the form and detail reasonably requested by NSI and to

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