Region/Country Executive-Incentive Plan




NU SKIN ENTERPRISES


Region/Country Executive -  Incentive Plan

July 2001 (updated March 15, 2002)




Purpose



	 	
Nu Skin Enterprises, Inc. (“Nu Skin”) believes that sound compensation
programs are essential to the retention, attraction and
motivation of personnel. The purpose of the Plan is to
focus executives on excellent, sustained performance that
leads to long-term growth, profitability and stability.	 





Objectives



	 	
The objectives of the Incentive Plan include:	 





	•	
Focusing executives on
the achievement of Nu Skin Enterprise business and strategic objectives;





	•	
Enhancing operational efficiency and teamwork within each region or country;





	•	
Increasing revenue and operating income; and





	•	
Attracting, retaining and motivating executives by emphasizing “pay for
performance” compensation programs that offer competitive total
compensation (base salary + incentives) opportunities upon achievement of
Region/Country financial and strategic objectives.












Effective Plan Date,
Duration and Performance Cycles



	•	
Effective Plan Date





 	 	
The effective Plan date is July 1, 2001. The Plan is in effect until further notice
and can be cancelled or changed by notification to plan participants prior to
the start of any fiscal quarter.





	•	
Performance Cycles





 	 	
Executives are eligible to earn 12.5% of the incentive award each fiscal quarter
calculated on the individual’s  base salary as of the start of the quarter,
and 50% of the incentive award each fiscal year  calculated on the  individual's
base  salary  earned  during  the  year,  all  based  upon  the   Company’s
performance during the quarters and the year.










Incentives and Participants



	 	
Executive  Incentive  Plan  Participants  have target award  opportunities
designed  to reward  superior  Regional/Country and Division   performance  and
maintain  externally  competitive total cash compensation  commensurate with the
Region/Country's performance:	 





 	 	
Participants’
incentive awards will be based upon the areas of the Company in which they
contribute, and 




	 	
Participants are assigned a target incentive award opportunity
expressed as a percentage of their base salary.  The following chart summarizes
 the percentages used to calculate the bonus for each executive group.





	INCENTIVES	 	 	 	 
	 	 	 	 	 
	Position	Total
Target
Incentive	Country
Profit
Portion	Country
Revenue
Portion	Division
Revenue
Portion
	Regional Vice President	50%	60%	40%	0%
	Country President/General Manager	50%	60%	40%	0%
	Country Senior Management	30% or 40%*	60%	40%	0%
	Country Division Manager	30% or 40%*	60%	10%	30%



*Percentage  to be applied to each
individual will be determined by the Regional Vice President










	PARTICIPANTS	 
	 	 
	Position	Participants
	Regional Vice Presidents 	Andrew Fan, Stewart McArthur, Nigel Sinclair
	Country President/General Manager	Takashi Bamba, Sung Tae Han, John Chou, Paul Nobles,
Mikael Linder, Roberto Policicio, Luiz Gonzales, Giovanni Lopez, Paul Hansen, Melisa Quijano, Bernie Mercado,
Antonia Chang, Frankie Kiow
	Country Senior Management	Shuji Inoue, K.S. Song, M. Kato, T. Takunaga, Y. Hori,
J. Dunn, M. Keller, Angela Lau, Iris Law

	Country Division Manager	Hori San, Sakamoto San, Luke Yoo, E.S. Park, Charlene
Chiang, David Chen













Critical Success Factors ("CSF's")



	•	The performance objective of Operating
Profit is weighted at 60%






	•	The
performance objective of Revenue is weighted at 40%






Performance Thresholds



	•	Threshold
 levels represent the minimum acceptable performance levels required for incentive pay-out.






	 	•	 The threshold level for objective of Operating Profit is 95%






	 	•	The threshold level for the objective of Revenue is 90%






	 	Note:	If  either CSF is below
the threshold level at the end of the Plan
performance cycle, no incentive will be paid.






	•	At the Threshold
level of performance, the incentive pay-out will
begin at 50% and increase linearly to the Targeted or 100%
level of performance.






	•	Target levels are set to essentially be in line with
achievement of 100% of budgeted revenue and operating profit.






	•	Outstanding levels represent performance levels that exceed the
target objectives.













Target Guidelines



	•	As shown in the table above,
Division executives will split the revenue based bonus between Country (10%) revenue and
Division (30%) revenue.







	•	Target incentive award
levels are determined by the
individual’s level of job responsibility, reflecting that job’s
ability to impact the Region/Country's financial performance, as well as competitive
total compensation practices (base salary plus incentives) for comparable jobs
within organizations similar in size and scope.






	•	The  actual incentive
pay-out may be smaller or larger,  depending  on overall  Region/Country,  and  Division
performance results.










Incentive Award Pay-out Guidelines



	•	Eligible participants will
be chosen by NSE and the Country Manager, and must be on the payroll at
the time of the payment;






	•	The number of days from
the date the Participant was selected for participation
to the fiscal period-end will be used to prorate the incentive award;






	•	Participants will receive
their awards, when earned, by separate check;






	•	Award  payments shall be
subject to any applicable withholdings; and






	•	Payments  will be made
approximately sixty days after each quarter-end, and ninety days after each fiscal year end.






	•	At  the  Outstanding
performance  level,  target cash incentives will be increased  linearly with the
following exception:






	 	•	The maximum possible
achievement for markets that budget an operating loss is 100%. (Actual operating
income loss must be less than budgeted loss).






	 	•	The maximum possible achievement
for markets that budget an operating profit between 0-5% is 150%.






	 	•	The maximum
possible achievement for markets that budget an operating profit between 5-10%
with revenue less than 5 million per year is 200%.