NSE 2002 Master Stock Option Agreement






NU SKIN
ENTERPRISES, INC.

SECOND
AMENDED AND RESTATED 1996 STOCK INCENTIVE PLAN

MASTER

STOCK OPTION
AGREEMENT


        This
Master Stock Option Agreement (the “Agreement”) is made effective as
of August ___, 200_ (the “Effective Date”), to     
              
              
(the “Optionee”) under the Nu Skin
Enterprises, Inc. Second Amended and Restated 1996 Stock Incentive Plan (the
“Plan”) by Nu Skin Enterprises, Inc., a Delaware corporation (“Nu
Skin Enterprises”), under authority of the Plan Committee (the
“Committee”). Capitalized terms used herein without definition and
defined in the Plan have the same meanings as provided in the Plan. For purposes
of this Agreement, the term “Company” shall refer collectively to Nu
Skin Enterprises and all of its Subsidiaries. The term “Key Employee
Covenants” shall mean the Key Employee Covenants executed by the Optionee
as they may be amended or replaced from time to time. 


     
1.      MASTER AGREEMENT. This Agreement is
a Master Agreement and the terms of each stock option grant set forth in any Stock
Option Schedule hereto shall be deemed to have been granted pursuant to this Agreement
and shall be subject to any and all conditions and provisions set forth in this
Agreement as it may be amended from time to time. Each Stock Option Schedule shall
incorporate all of the terms and conditions of this Agreement and shall contain such
other terms and conditions that the Committee shall establish for the grant of
options covered by such Stock Option Schedule. In the event of a conflict between the
language of this Agreement and any Stock Option Schedule, the language of the Stock
Option Schedule shall prevail with respect to that Stock Option Schedule. In order to
be effective, the Stock Option Schedule must be executed by a duly authorized
executive officer of the Company. No signature of the Optionee shall be required,
and the Optionee's acceptance of the Stock Option Schedule shall be deemed to be his or
her acceptance of all the terms and conditions set forth therein. Optionee shall
be deemed to have accepted the Stock Option Schedule (and all of the terms and
conditions set forth therein) unless Optionee provides written notice of his or her
rejection of the Stock Option Schedule and all of the Options granted thereunder within
20 days after receipt of the Stock Option Schedule. 


     2.      
OPTION GRANTS. Each Stock Option
Schedule shall set forth the number of options (the "Options") that the
Committee has granted to Optionee and the effective date of such grant. Such
Options are granted as an incentive to work to increase the value of the Company for its
stockholders. Each Option shall entitle the Optionee to purchase, on the terms and
conditions of this Agreement, the respective Stock Option Schedule and the Plan, one
fully paid and non-assessable share of Class A Common Stock, par value $ .001 per
share (the "Class A Common Stock"), of Nu Skin Enterprises at the
exercise price set forth in the relevant Stock Option Schedule. The Options are
subject to all the terms and conditions of the Plan, the Stock Option Schedule and this
Agreement. 


     3.      
NATURE OF OPTION. Each Stock Option
Schedule shall designate whether the options granted thereunder are Nonqualifed Stock
Options or Incentive Stock Options. 


     4.      
TERMS AND EXERCISE PERIOD. 


            
(a)      
Options awarded under this Agreement
may not be exercised at any time until such Options are vested as provided in Section 5
below. 


            (b)
       Except as otherwise provided in a
Stock Option Schedule or this Agreement, the Options granted hereunder shall terminate
on the earlier of (i) the tenth anniversary of the date of the grant of the options as
set forth in the Stock Option Schedule, or (ii) the date such Options are fully
exercised. 



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5.       VESTING. Unless expressly provided
otherwise in a Stock Option Schedule, Options granted hereunder shall vest according to
the following schedule: 




	ANNUAL ANNIVERSARY
OF EFFECTIVE DATE OF GRANT
	VESTED PERCENTAGE

	1	 	25	%
	2	 	50	%
	3	 	75	%
	4	 	100	%







      6.      
TERMINATION OF SERVICE. 


            (a)
       In the event the employment of the
Optionee is terminated for any reason, all Options that are not vested at the time of
termination of employment shall be terminated and forfeited immediately upon termination
of employment. 


            (b)
       Subject to Section 7 below, in the
event the employment of the Optionee is terminated for any reason other than the death
or disability of the Optionee, then any Options granted hereunder that are vested
but unexercised at the time of termination of employment shall terminate
immediately upon the earliest to occur of the following: (i) the full exercise of the
Options, (ii) the expiration of the Options by their terms, or (iii) 90 days following
the date of termination of such employment of the Optionee. 


            (c)
       Subject to Section 7 below, in the
event the employment of the Optionee is terminated as a result of death or
disability prior to the termination of the Options, then any Options granted
hereunder that are vested but unexercised at the time of death or disability shall
terminate immediately upon the earliest to occur of the following: (i) the full
exercise of the Options, (ii) the expiration of the Options by their terms, or (iii)
one year following the date of death or disability of Optionee. The Options may be
exercised, to the extent vested and unexercised at the time of death or disability,
as the case may be, by the Optionee, the estate of the Optionee, or the person or
persons to whom the Options may have been transferred by will or by the laws of descent
and distribution for the period set forth in this Section 6(c). 


      7.      
FORFEITURE. If at any time during
the term of the Options granted pursuant to this Agreement a Forfeiture Event (as
defined below) shall occur or be discovered, then all outstanding Options shall
immediately terminate in full. If at any time during the Optionee's employment or at
any time following Optionee's termination of employment until the later of (i) the
twelve-month anniversary of the date Optionee's employment is terminated for any
reason, or (ii) the six-month anniversary of the date Optionee exercises Optionee's
last remaining Options, a Forfeiture Event occurs, then the Optionee shall pay to the
Company an amount equal to the "Option Gain" on any Options exercised during
the twelve-month period preceding such Forfeiture Event and any Options exercised
following such Forfeiture Event. For purposes hereof, "Option Gain"
shall mean the Fair Market Value of a share of the Class A Common Stock on the date of
exercise over the Option Price, multiplied by the number of shares purchased upon
exercise of the Options. "Forfeiture Event" means the following: (i)
conduct related to the Optionee's employment for which either criminal or civil
penalties may be sought, (ii) the commission of an act of fraud or
intentional misrepresentation, (iii) embezzlement or misappropriation or conversion
of assets or opportunities of the Company, (iv) any breach of the non-competition or
non-solicitation provisions of the Key Employee Covenants, (v) disclosing or misusing
any confidential or proprietary information of the Company in violation of the Key
Employee Covenants, or any other non-disclosure agreement with the Company or other
duty of confidentiality or the Company's insider trading policy, (vi)




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any other material breach of the Key Employee Covenants, or (vii) any
other actions of Optionee that the Committee determines in good faith are harmful to the
interests of the Company. The Committee, in its sole discretion, may waive, at any time,
in writing this forfeiture provision and release the Optionee from liability hereunder.
In addition, the Committee may, in its sole discretion, elect to purchase any shares
acquired upon exercise of the Option for the exercise price paid by the Optionee in lieu
of enforcing payment of the Option Gain with respect to any shares which have not been
sold or otherwise transferred by the Optionee. 


      8.      
STOCK CERTIFICATES. Within a
reasonable time after the exercise of an Option and the satisfaction of the
Optionee's obligations hereunder, the Company shall cause to be delivered to the
person entitled thereto a certificate for the shares purchased pursuant to the exercise
of such Option. 


      9.      
TRANSFERABILITY OF OPTIONS. This
Agreement and the Options granted hereunder shall not be transferable otherwise than
by will or by the laws of descent and distribution and shall be exercised, during the
lifetime of the Optionee, only by the Optionee. 


     10.      
EXERCISE OF OPTIONS. Options shall
become exercisable at such time, as may be provided herein and shall be exercisable
by written notice of such exercise, in the form prescribed by the Committee, to
the person designated by the Committee at the corporate offices of Nu Skin
Enterprises. The notice shall specify the number of Options that are being
exercised. The exercise price shall be payable on the exercise of the Options and shall
be paid in cash, in shares of Class A Common Stock, including shares of Class A
Common Stock acquired pursuant to the Plan, part in cash and part in shares, or such
other manner as may be approved by the Committee consistent with the terms of the
Plan as it may be amended from time to time. Shares of Class A Common Stock
transferred in payment of the exercise price shall be valued as of the date of
transfer based on the Fair Market Value of the Company's Class A Common Stock,
which for purposes hereof shall be considered to be the average closing price of the
Company's Class A Common Stock as reported on the New York Stock Exchange for the ten
trading days just prior to the date of exercise. Only shares of the Company's Class A
Common Stock which have been held for at least six months may be used to exercise the
Option. 


      11.      
NO RIGHTS AS SHAREHOLDER. This
Agreement shall not entitle the Optionee to any rights as a stockholder of the Company
until the date of the issuance of a stock certificate to the Optionee for shares
pursuant to the exercise of Options covered hereby. 


      12.      
GOVERNING PLAN DOCUMENT. This
Agreement incorporates by reference all of the terms and conditions of the Plan as
presently existing and as hereafter amended. The Optionee expressly acknowledges
and agrees that the terms and provisions of this Agreement are subject in all respects
to the provisions of the Plan. The Optionee also hereby expressly acknowledges, agrees
and represents as follows: 


            (a)
       Acknowledges receipt of a copy of the
Plan and represents that the Optionee is familiar with the provisions of the Plan, and
that the Optionee enters into this Agreement subject to all of the provisions of the Plan. 


            (b)
       Recognizes that the Committee has
been granted complete authority to administer the Plan in its sole discretion and
agrees to accept all decisions related to the Plan and all interpretations of the
Plan made by the Committee as final and conclusive upon the Optionee and upon all
persons at any time claiming any interest through the Optionee in any Option granted
hereunder. 


            
(c)        If Optionee is an executive officer,
acknowledges and understands that the establishment of the Plan and the existence of
this Agreement are not sufficient, in and of themselves, to exempt the Optionee
from the requirements of Section 16(b) of the Exchange Act and any rules or
regulations promulgated thereunder and that the Optionee (to the extent Section
16(b) applies to





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Optionee) shall not be exempt from such requirements pursuant to
Rule 16b-3 unless and until the Optionee shall comply with all applicable
requirements of Rule 16b-3, including without limitation, the possible requirement
that the Optionee must not sell or otherwise dispose of any share of Class A Common
Stock acquired upon exercise of an Option unless and until a period of at least six
months shall have elapsed between the date upon which such Option was granted to the
Optionee and the date upon which the Optionee desires to sell or otherwise dispose of
any share of Class A Common Stock acquired upon exercise of such Option. 


            (d)
       Acknowledges and understands that
the Optionee's use of Class A Common Stock owned by the Optionee to pay the Option Price
of an Option could have substantial adverse tax consequences to the Optionee and that
the Company recommends the Optionee consult with a knowledgeable tax advisor before
paying the Option Price of any Option with Class A Common Stock. 


            (e)
       Represents that Optionee has
received and carefully read a copy of the Prospectus (as defined below) together
with the Company's most recent Annual Report to Stockholders. Optionee hereby
acknowledges that he or she is aware of the risks associated with the Options and that
there can be no assurance the price of the Class A Common Stock will not decrease in
the future or that the Options will ever have any value. Optionee hereby
acknowledges no representations or statements have been made to Optionee
concerning the value or potential value of the Class A Common Stock. Optionee
acknowledges that Optionee has relied only on information contained in the
Prospectus and that Optionee has received no representations, written or oral, from
the Company or its employees, attorneys or agents, other than those contained in the
Prospectus or this Agreement. The Prospectus means those materials bearing a legend
that such materials constitute a prospectus under the Securities Act of 1933 and the
documents incorporated by reference therein. Optionee acknowledges
that the Company has made no representations concerning the tax and other effects of
this Option and the exercise thereof, and Optionee represents that Optionee has
consulted with Optionee's own tax and other advisors concerning the tax and other
effects of the Option and the exercise thereof. 


      
13.       REPRESENTATIONS AND WARRANTIES. As
a condition to the exercise of any Option granted pursuant to the Plan, the Company may
require the person exercising such Option to make any representations and warranties to
the Company that legal counsel to the Company may determine to be required or advisable
under any applicable law or regulation, including without limitation, representations
and warranties that the shares of Class A Common Stock being acquired through the
exercise of such Option are being acquired only for investment and without any present
intention or view to sell or distribute any such shares. 


      14.      
NO EMPLOYMENT OR SERVICE CONTRACT.
Nothing in this Agreement or in the Plan shall confer upon Optionee any right to
continue in the employment or service of the Company for any period of specific
duration or interfere with or otherwise restrict in any way the rights of the Company,
which rights are hereby expressly reserved, to terminate Optionee's employment or
service at any time for any reason, with or without cause except as may otherwise be
provided pursuant to a separate written employment agreement. 


      15.      
WITHHOLDING OF TAXES. The Optionee
authorizes the Company to withhold, in accordance with applicable laws and regulations,
from any compensation or other payment payable to the Optionee, all federal, state
and other taxes attributable to taxable income realized by the Optionee as a result of
the grant or exercise of any Options. As a condition to the exercise of any Option,
Optionee shall remit to the Company the amount of cash necessary to pay any withholding
taxes associated therewith or make other arrangements acceptable to the Company, in
the Company's sole discretion, for the payment of any withholding taxes. 


      16.      
EFFECTIVE DATE OF GRANT. Each Option
granted pursuant to this Agreement shall be effective as of the date first written
above. 




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      17.      
COMPLIANCE WITH LAW AND REGULATIONS.
The obligations of the Company hereunder are subject to all applicable federal and
state laws and to the rules, regulations
and other requirements of the Securities and Exchange Commission, any stock exchange
upon which the Class A Common Stock is then listed and any other government or
regulatory agency. 


      18.      
SECTION REFERENCES. The references
to Plan sections shall be to the sections as in existence on the date hereof unless an
amendment to the Plan specifically provides otherwise. 


      19.      
QUESTIONS. All questions regarding
this Agreement shall be addressed to M. Truman Hunt. 





[Intentionally Left Blank] 







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        IN
WITNESS WHEREOF, these parties hereby execute this Agreement to be effective as
of the Effective Date. 


NU SKIN ENTERPRISES, INC., a Delaware
corporation 




By:    /s/Steven J. Lund         
             
           

Its:    Steven J. Lund, President and CEO











Optionee










Optionee's Address




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