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An

INTRODUCTIONTO MELALEUCA

�An overview of the

philosophies and products

that make us unique.

“Those who have a here-

and-now, get-rich- quick

philosophy will not

benefit from the

Melaleuca opportunity.

Here, the important

investment is not money,

but time. Those who are

willing to give of

themselves—their

energy, commitment, and

dedication—will enjoy

great returns. With a

long-term perspective

and old-fashioned hard

work, the Melaleuca

business can open the

door to financial rewards,

a healthier way of life,

and a satisfying way to

help others.”

Frank L. VanderSloot

Melaleuca may, at its sole discretion, amend, modify, delete,discontinue, or add to any of the items set forth in this booklet.

Congratulations! You’ve just joined a community ofcustomers who believe in naturally based products thatpromote wellness and vitality. You’re well on your way to a more energetic, vibrant way of life.

Perhaps you enrolled in Melaleuca to enjoy the benefits of health-promoting products. And perhaps you’d also liketo earn extra income for a child’s education, a retirementfund, or to get out of debt. Maybe you’re ready to buildyour own Melaleuca business.

It’s all here. It’s easy to follow. All you have to bring to theequation is your time, your effort, your commitment, andyour willingness to learn.

MELALEUCA’S MISSION STATEMENTEnhancing the lives of those we touch by helping people reach their goals.SM

WELCOME TO MELALEUCA.

THE MELALEUCA BEGINNING AN INTRODUCTION TO MELALEUCA

The Melaleuca story begins with Frank’s childhood, growing up on a small farm inthe mountains of northern Idaho. Frank watched his father work long, hard hours onthe railroad for less than $300 a month. The family raised their own beef, tended agarden, and worked to make ends meet.

After promising his father that he would get a college education, Frank worked hardon the farm, on the railroad, in a laundromat, and at several other jobs to pay his way. Aftercollege, Frank landed a job with a Fortune 500 company and rose to the position of vicepresident. Through the years he learned that as long as he worked for someone else, hewould never enjoy wealth.

“I never really imagined being wealthy,” he says. “But I noticed how the systemworked. There wasn’t much of an opportunity for the little guy.”

A New Opportunity “People don’t want to be given money,” Frank says. “They just want an opportunity.Today, opportunity is getting tougher and tougher to find. With corporate mergersand leveraged buyouts, the big corporations just continue to expand. In the old daysyou could start a hamburger stand on a shoestring investment. Now there arehamburger franchises on every corner, and if you want to break into one of theseexisting franchises, you have to invest hundreds of thousands, even millions of dollars.If you don’t have a lot of money, most likely you’ll always work for someone else.”

In December of 1984, Frank got the chance to try out some of his business ideas.He was offered a job with a multi-level marketing company that planned to “setpeople up in business.” Sales started out with a bang, but within six months thecompany folded.

“I learned a lot through that experience,” Frank says. “First, I learned that I didn’twant anything to do with multi-level marketing. Second, I learned that it isimportant for people to buy real products because they really want them, not becausethey are trying to qualify for a bonus. Third, I learned it doesn’t work to set people upin business or sell them inventory—we have to remove the risk and help themoperate a business. And finally, I learned that there are hundreds of thousands ofpeople out there who either haven’t made it or don’t want to continue in the corporateworld, but who are hard workers, full of potential, and full of enthusiasm.”

Melaleuca BeginsFrank started over with a new company, one that was not a multi-level marketingorganization. He developed a mission statement he could believe in. He hired top productchemists to combine science and nature to create the best products available. And hedeveloped a business plan that would reward those who produced. He implemented his

THE MELALEUCA BEGINNINGFounded by CEO Frank L. VanderSloot, Melaleuca is a company based

on the vision of giving people the opportunity to reach their goals.

4

“Although I never imagined beingwealthy, I noticed how the system

worked. There wasn’t much of anopportunity for the little guy.”

Frank L. VanderSloot

5 AN INTRODUCTION TO MELALEUCA THE MELALEUCA BEGINNING

idea of redistributing profits to anyone who contributed to the growth of the company. The result is a company that provides anyone, anywhere, with the opportunity to enjoyquality products and build a thriving home business.

MELALEUCA ANNUAL GROSS SALES*

* Reflects total sales of all Melaleuca affiliatesworldwide, in U.S. dollars.

MELALEUCA FACTS

· Listed by Inc. Magazine as one of the Inc. 500 fastest growing companies 5 years in a row

· Winner of the Blue ChipEnterprise award from the U.S.Chamber of Commerce

· Over 18-year track record as afinancially sound business

· Frank L. VanderSloot (CEO)awarded U.S. NorthwestEntrepreneur of the Year byCNN, USA Today, and Ernst & Young (2001)

Melaleuca’s record of consistentgrowth has continued eventhrough tough economic times. The company’s continuedsuccess is based on producingsuperior products designed topromote health and wellness.

$420,000,000

$400,000,000

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$500,000,000

$520,000,000

$540,000,000

$560,000,000

You’ve seen them before—businesses that promise great wealth and prosperity with aminimal amount of effort. What makes Melaleuca different? Melaleuca manufacturesquality products, sells them at reasonable prices, and gives customers the opportunityto share in the profits. By eliminating the costs of distribution, advertising, anddelivery to stores, Melaleuca saves the customer money, creates customer loyalty, andprovides an opportunity for customers to build a sensible business that comes withresidual income.

Consumer Direct Marketing™

Consumer Direct Marketing redirects funds that would typically be used foradvertising, multiple shipping costs, various middlemen, and several distributionchannels into spending for higher quality ingredients, product innovations, and profitsharing with customers. The result is a method of delivering quality, low-cost productsto families around the world—and then sharing the income with those families.

Melaleuca Is Not Multi-Level MarketingWhen you think of multi-level marketing, you may think of overbearing salespeopletrying to manipulate others into buying lots of inventory. You may imagine a get-rich-quick scheme with promises of great wealth through very little work. You mightenvision business schemes that lack a compelling product, but hype up the promiseof big incomes.

There are several reasons why Melaleuca is not like multi-level marketing. AtMelaleuca, there are no inventories to buy, no financial risks, and no hype. Customersonly buy what they need each month. Some customers become MarketingExecutives and earn a commission from the monthly purchases of the customersthey refer. However, the majority of customers buy each month without any interestin receiving commissions—they simply want healthier lives, healthier homes, andexceptional products at great prices.

WHAT MAKESMELALEUCA DIFFERENT?Melaleuca manufactures quality products, sells them at reasonable prices,

and gives customers the opportunity to share in the profits.

MELALEUCA:

3 Is a financially sound company with a longtrack record of success.

3 Produces unique products that people liketo buy month after month.

3 Has loyal customers with a high reorder rate.

3 Provides an opportunity where anyone canbuild a successful business.

3 Is concerned about its customers, theirhomes, and the environment, and thusproduces products and services thatpromote wellness for every aspect of life.

WITH MELALEUCA:

3 There is no risk and no major investmentsother than time and commitment.

3 You don’t have to quit your regular job orinvest your savings.

3 You can work from home and create yourown schedule.

3 There is unlimited income potential.

3 There are no repeat sales presentations andno pressuring customers to purchase.

3 Products are shipped directly to customers,so there is no need for you to worry aboutinventory, billing, delivery, or complicatedpaperwork.

3 You have the joy of helping others improvetheir health and finances.

3 Achieving a balance between work andfamily is a real possibility.

THE MELALEUCA BEGINNING AN INTRODUCTION TO MELALEUCA 6

7 AN INTRODUCTION TO MELALEUCA THE MELALEUCA BEGINNING

MELALEUCA FACTS:

· To ensure quality, freshness,and performance, Melaleucamanufactures most of itsproducts.

· Melaleuca operates threestate-of-the-art productionfacilities in the U.S. and overa dozen distribution centersaround the world.

· Melaleuca’s high-volumeproduction creates lowercosts for customers.

· Melaleuca’s QualityAssurance and Research &Development personnel aresome of the world’s best atensuring the highest qualityand combining the best ofscience and nature to createthe most effective productsavailable anywhere.

Melaleuca: The Wellness CompanySM offers a catalog full of products that promotehealth and well-being, help protect the environment, are cost-effective, use the best

natural ingredients, and are safer for your home and family.As civilization continues to develop and evolve, science has

found that we can expect to live longer. In the 1940s, life expectancy forboth men and women was only in the 60s. Today, the rate continues

to climb. Scientists predict that by 2020, it will be normal forvirtually everyone to live into their 90s. But living longer does not

guarantee we will enjoy it. To enjoy a longer life, most people need good physical

health, financial security, and personal wellness. In addition, weneed to have a planet that can support us in a healthy way.Melaleuca contributes to all these needs through products thatpromote physical wellness, environmental wellness, personal

wellness, and financial wellness.

Creating health and

physical vitality through support of a

lifestyle that includes good nutrition, exercise,

natural supplements, andvitality products.

Contributing to the environment by avoiding

harmful ingredients, using concentrated

formulas, helping families create healthier and safer homes.

Promoting the rewards of a debt-free lifestyle, and creating the best alternative for attaining financial freedom.

THE TOTAL WELLNESS CONCEPT

AVERAGE LIFE EXPECTANCY

Source: National Center for Health Statistics

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Age

Male

Female

“I spent over $2,000 trying to determine why I wasfatigued all the time. After my first day on The

Vitality Pack™, I felt a lot more energy. I decided totry Melaleuca’s 90-day Vitality Pack challenge. After

only a few days, I felt my energy returning. Sixmonths after starting The Vitality Pack, I hiked 11miles down the Grand Canyon with a 40-pound

backpack on my back. At age 52, I had enoughenergy to go exploring side canyons. I have a PhD

and it naturally makes me skeptical—but notabout Melaleuca and its products.”

John Coles, Director, Nevada

THE WELLNESS COMPANYResearch shows people are living longer. Many are finding themselves

physically and financially unprepared. Melaleuca provides a way to help take care of your long-term physical and financial health.

THE WELLNESS COMPANY AN INTRODUCTION TO MELALEUCA 8

PHYSICAL WELLNESSEvery 33 seconds a person dies of cardiovascular disease. By 2020, nearly half of allpeople over the age of 50 will be affected by arthritis. Sixty-four percent of theadult population is overweight, and one in four kids is now overweight. Worse,research has shown that excessive weight increases the risks for high bloodpressure, heart disease, stroke, diabetes, gallstones, and cancers of the prostate,colon, breast, and ovaries. Depression is the world’s leading cause of chronicdisability, with over 18 million Americans suffering from clinical depression.

Vitality for Life™—Melaleuca’s line of health products—is designed to helppromote your long-term physical health, raising the odds that you’ll avoid theproblems many people experience as they age. Using plant extracts andresearch-recommended doses of vitamins and minerals, Vitality for Life productsfollow scientific guidelines for antioxidant protection, optimal cellular function,cardiovascular protection, and more.

“I weighed myself the first day of May and wasn’t happy with what the scale said.So my mom and I started walking 2 miles, 3 times a week. We now walk 5 times aweek, 2 miles a day. I haven’t been on a special diet (I eat what I’m hungry for). Ihave now lost a little over 30 pounds. Yay! I know that wouldn’t have happened without the Access Bar™. The best part is, eating the Double Fudge Access Bar is likehaving a frosted brownie before I go for my walk. I can’t thank you enough forthese exceptional products.” *

Beth Peters, Executive Director II, Iowa

* Individual results may vary.

DID YOU KNOW?

· The leading causes of death in 2000 wereheart disease (36%), cancer (27%), andrespiratory diseases (5.1%).

· More than 2,600 Americans die of cardiovascular disease each day—that’s anaverage of one death every 33 seconds.(American Heart Association, 2003)

· By 2020, nearly half of all people over age 50will be affected by arthritis. More than 60million women will suffer fromosteoporosis. (Centers for Disease Control)

· The average obese person will die 13 yearsearlier than a person of normal weight. 62%of Americans are overweight— 34% ofthem are clinically obese. (New EnglandJournal of Medicine, 2003)

· 90% of all men will have some form ofprostate cancer or disease by age 85.(Journal of Urology, 1997)

· There is nothing more powerful than yourbody’s inherent ability to heal itself as longas you provide it with proper nutrition.

9 AN INTRODUCTION TO MELALEUCA THE WELLNESS COMPANY

ENVIRONMENTAL WELLNESSUsing limited resources wisely and taking action to reduce waste will help ensure thatfuture generations will enjoy an environment as clean and plentiful as the one weenjoy now.

However, while many people focus on reducing outdoor pollution, scienceshows that indoor pollution can often be more prevalent and more dangerous.Consider these facts:

· The Environmental Protection Agency reports that toxic chemicals found in homesare three times more likely to cause cancer than outdoor airborne pollutants.

· The leading dishwasher detergent contains 3.39 grams of phosphates per tablespoon. Ifevery North American household washed just one load of dishes each day with thisproduct, more than 4,800 tons of phosphates would be needlessly dumped into ourwaterways, threatening the natural balance of fish and algae life.

· As new reports come forth on the danger of phosphates, countries like Switzerland,Norway, Venezuela, and the United States (12 states so far) have completely bannedthe use of phosphates in detergents.

· More than 17 million Americans are currently estimated to suffer from asthma, and ina fourteen-year period, reported asthma cases increased in the U.S. by an alarming 75%.

Considering such statistics, many families are searching for more environmentallyresponsible cleaning products. Melaleuca’s EcoSense® line develops detergents anddishwashing soaps that are phosphate-free, plus stain removers, grease-killers, andwhitening agents with no formaldehyde, ammonia, chlorine, lye, or bleach—ingredientsoften used in grocery-story brands.

Melaleuca uses the cleaning properties of natural ingredients like Melaleuca Oil,enzymes, sugar cane, baking soda, vinegar, and citrus solvents. These ingredients createproducts that are safer and often more effective. Customers repeatedly tell stories of gettingstains out with Melaleuca products when other products failed. Clothes come out of thewasher clean and bright—without irritating the skin.

In addition, Melaleuca products are shipped without the water fillers so oftenfound in other brands. Highly concentrated, the products cost less per use whilesaving landfills from expensive buildup of large containers.

“I am so thankful that I have usedMelaleuca’s laundry and cleaning products

and not exposed my family to harshchemicals and toxins from other brands.

I know that has made a huge difference inour health over time.”

Kim Cherveny, Corporate Director III, Florida


PERSONAL WELLNESSSuccessful living is not a matter of choosing between success in the workplace orsuccess at home; it is not a matter of choosing personal achievement or helping othersto achieve; it is the product of all of these working together.

Yet in today’s world, it often seems that work and financial responsibilities cantake over our lives, leaving little if any time to explore personal wellness.

Family WellnessPerhaps one of the biggest concerns of today is time with our children. Researchshows that teens who do not regularly eat dinner with their families are 61% morelikely to smoke, drink alcohol, and use drugs (Columbia University Study).

Melaleuca customers continually write about how the business opportunity hasafforded them more time with their children. Children, also, are thrilled at the change.“I really like it that my daddy doesn’t have to work at the flower shop anymore,” saysJuliet LaChappelle, 10-year-old daughter of Executive Directors II Holly and JeffLaChappelle. “He gets to go on field trips with me now. He used to work all day.”

Social WellnessMelaleuca affords many Marketing Executives the opportunity to meet new people,develop new skills, improve friendships, and create an opportunity that can enhancetheir lives by helping others enhance their lives. In Melaleuca, it is impossible tosucceed without helping others to do the same. Helping others is the core ofMelaleuca’s mission.

Intellectual WellnessIntellectual wellness includes keeping your intellect alive, challenged, and growing.Activities, such as attending seminars, reading good books, staying current on eventsaround the world, listening to uplifting music, continuing to challenge yourself, andtrying new things can help you grow. Melaleuca provides conventions, trainingseminars, and more to help you continue to expand your business knowledge andyour general intellectual wellness.

Inner WellnessTo define inner wellness, you might ask yourself, “What do I stand for? What are thevalues I believe are important?” With Melaleuca, values like honesty, integrity, andhard work may all be applied to your business efforts, creating a smooth seambetween your personal and business ideals.

“At Melaleuca, you get to meet others whose values and ethics are high,” saysSteve Peters, Executive Director VII. “We are a community of people trying to helpeach other improve.”

“Some of the biggest benefits of Melaleucaare my own personal development since Ibegan building a business and the joy Iexperience as I help others to improve theirlives and personal situations.”

Alan Pariser, Corporate Director V, Florida


FINANCIAL WELLNESSMost families have concerns about finances at one time or another. Rising medical,educational, and living expenses put more and more strain on people every day.

A fluctuating economy creates uncertainty in jobs while meaningful pensions arenearly a thing of the past. Today, more than half of American couples are forced to earntwo incomes to survive. People work more hours per week—an average of 50–60.Thousands take on a second or third job, and many have declared bankruptcy at leastonce in the past decade. Credit card debt is at an all-time high, and finding anythingextra to build retirement savings seems an endless if not impossible struggle.

Families are wondering—is there no way out? To look ahead to a future of work,work, work and less and less time with loved ones can be bleak and extremelydiscouraging. Many people have lost hope, settling into a routine of exhaustion and apathy.

Such conditions lead many to search for business opportunities that might offera greater chance at financial security. Unfortunately, most of these “opportunities”require high investments and expansive inventories and come with an alarming riskof failure. After getting burned a few times on such endeavors as these, manyenterprising individuals return to the “rat race,” convinced that there’s no way out.

Melaleuca was established on the idea that the “little guy” can succeed ifprovided the right opportunity, even in the face of competition from largecorporations, and with a low up-front investment. Hundreds of thousands ofMelaleuca Marketing Executives around the world are proof that dreams can becomerealities. Not only are they enjoying financial security, but they’re enjoying the thingsthey’ve always dreamed of—healthy retirement savings, debt-free lifestyles, increasedtravel, home improvements, child college funds, help for aging parents, time withchildren, and much more. Best of all, they’re creating residual income that continuesto bring benefits. They have done all this and more—and you can do the same for youand your family.

“Many parents who have to put in a full day at a corporation rarely see their infantsawake. Our financial situation provides us with a wonderful quality of family life.Our income affords us the opportunity to stay home with our children andparticipate in their daily lives.”

Ronni Paley, Executive Director II, New York

SOUND FAMILIAR?

· The average mortgage is $184,000 at aninterest rate of 6.75% and a monthlypayment of $1,193

· The average car debt is $12,750

· The average credit card debt is over$8,000 and is expected to grow at least10% each year

· One half of households with peopleclose to retirement had less than$55,000 in savings and one quarter hadless than $13,000

· The average retiree benefit from SocialSecurity is only $10,740 per year

All figures are in U.S. dollars.

“Being out of debt is great, it’s given us more choices. What we do hasn’t

changed—we still work every day—but Ithink there’s just a tremendous peace of

mind knowing that what we have is ours.”

Bill and Merijo Alter, Executive Directors II, Missouri


BURNING THE FINAL DEBTMany Melaleuca Marketing Executives haveexperienced the joy of using their Melaleucaincome to pay off their mortgages and get out ofdebt—for good.

“Being single, I realized I could only dependon myself for an income,” says RoxanneValentine, Senior Director II from Boise, Idaho.“So right away I decided I wanted to be debt free,and that I didn’t want to struggle with finances. Iwanted to be in the situation where, if anythinghappened to halt the income, I would alwayshave a home to live in.” With her Senior Directorincome added to her budget, Roxanne was ableto make double or even triple mortgagepayments each month. Just four years afterbuying her home, it was completely paid off, andonce the final payment was made, President andCEO Frank L. VanderSloot went to her home forRoxanne’s Total Financial Freedom Awardcelebration. They set her mortgage on fire whilemembers of Melaleuca’s management team andabout 60 of her friends and Melaleuca businessbuilders cheered her on!

Perry and Vicki Rush, Directors III from South Carolina, also watched theirmortgage papers go up in flames after they put the income from their Melaleucabusiness towards their mortgage payments. This simple strategy saved Perry and Vickiapproximately $80,000US in interest while avoiding 18 years on the original loan.“We’re looking at possibly another home, but we don’t want to borrow money again,”Perry says. “It’s a great feeling to have things paid for. You feel liberated.”

After burning their mortgage agreement on a beautiful summer night in El Dorado Hills, California, Bill and Kathy Hardy, Executive Directors III, took amoment to reflect on what being debt-free means to them. “It just seems like you seethings differently when you don’t have a mortgage,” Bill remarks. “There’s a burdenthat’s no longer on your mind. And without that burden we’re thinking, ‘What can wedo to get even further along?’”

Trixie and Rod Overcashier, Executive Directors III from Minnesota, burnedtheir mortgage on July 26, 2003. They had always set their sights on getting out of debt,and Melaleuca helped them accomplish that early in their lives. “Being in debt was notan option,” Rod says. “We don’t want to wait to enjoy life. We want to do it now.”

Roxanne Harlow and Melaleuca Presidentand CEO Frank L. VanderSloot watch her

mortgage papers go up in flames.

“When you have the finances to deal with the changes that come

along in life, you feel at peace.”

Roxanne Harlow, Senior Director II, Idaho


Melaleuca is dedicated to producing unique products with the bestnature and science have to offer. With the money saved onadvertising and distribution, Melaleuca invests in research, productdevelopment, and superior ingredients and formulas that are theresult of balancing the research of science with the best of nature.The following few pages are a sampling of some of Melaleuca’s mostpopular products.

EXCEPTIONAL PRODUCTS ATREASONABLE PRICES

Melaleuca’s exceptional products can begrouped into five categories:

· Vitality for Life™ Exclusive nutritional supplements for dailyhealth maintenance and specifichealth concerns, plus weightmanagement and sports nutrition.

· EcoSense® Laundry and cleaningproducts with natural, non-causticingredients that are safer for the homeand the environment.

· Nicole Miller Skin care and cosmeticproducts that use natural vitamins,minerals, and plant extracts to promotehealthy and beautiful skin.

· Melaleuca Bath & Body Personalcare and dental products to helpreduce stress, promote beauty andrelaxation in the home, and care for thehair and skin with nature’s magic.

· Melaleuca Pharmacy™ Pain relieversand natural first aid wonders that costless than grocery-store brands and helpheal wounds and infections with thewonder of Melaleuca Oil.

THE MELALEUCAPRODUCT PHILOSOPHY

Melaleuca’s founding axiom is to provide exceptional products at reasonable prices. It’s the basis of everything we do.

THE MELALEUCA PRODUCT PHILOSOPHY AN INTRODUCTION TO MELALEUCA 14

VITALITY FOR LIFE™

Exclusive nutritional supplements for daily health maintenance and specific healthconcerns, plus weight management and sports nutrition. Here are just a few ofour exceptional products:

The Vitality Pack™

Daily multivitamin and mineral supplement.

· Provides the vital nutrients your diet may be missing

· Patented Fructose Compounding delivery system designed to pre-bind minerals tofructose molecules to help your body better absorb the critical nutrients it needs

· Contains 25 vitamins, minerals, and other nutrients

PROVEXCV®

Cardiovascular supplement.

· Developed with Dr. John Folts, a nationally known expert in blood plateletaggregation and the scientist who first demonstrated that aspirin can lower bloodplatelet activity and help maintain heart health

· A combination of all-natural ingredients including grape seed and bilberry

· The only such supplement on the market proven effective through human scientificstudies to help maintain a healthy cardiovascular system

Replenex®

Natural support for healthier joints.

· The only joint-care product on the market to promote lubrication and regenerationof cartilage and address the negative effects of free radical damage—one of theprimary adversaries to joint health

· Delivers the research-recommended 1,500 mg dose of pure glucosamine HCl—themost potent and stable form of glucosamine available

· Contains natural ingredients—including bromelain, ginger, and green tea—that arebeneficial to joint health

“For years, I had a problem with tiredness.It was hard for me to drag myself out of

bed by ten o’clock. And by two, I wanted anap. As the years passed, it got worse. I

talked to a doctor when I was 27 years old.He said it was depression and put me on

anti-depressants. But I wasn’t depressed, Iwas tired. I tried taking vitamins from

Wal-Mart, but they didn’t help at all. ThenI joined Melaleuca and ordered The VitalityPack. Within four days, I was up at 7:00 am

ready to go. I am now 31, awake all day,and finally enjoying life.” *

Wendy Rodgers, Director, Texas


These statements have not been evaluated by the Food & Drug Administration. These products are not intended to diagnose, treat, cure, or prevent any disease.

15 AN INTRODUCTION TO MELALEUCA THE MELALEUCA PRODUCT PHILOSOPHY

“As a hairdresser, I often ruin clothes with hair color. But a recent incident really put your products to the test. I

mixed up a bowl of permanent red haircolor, then put it on a cart. The cart fell onme and I had red dye all down the legs of

my jeans. There was only time to wipe itoff and go back to work. Five hours later, I

sprayed them with PreSpot™ and left themfor an hour. Then I washed them with

MelaPower and MelaBrite.™ I was amazed—the entire stain came out. Melaleuca’s

products have made a believer out of me!”

Melanie Patterson,Executive II, Minnesota

ECOSENSE®

Laundry and cleaning products with natural, non-caustic ingredients that are saferfor your home and the environment. Here are just a few of theseexceptional products:

MelaPower®

Laundry detergent.

· World’s most effective non-alkaline formula cuts through soils and stains withoutdamaging fabrics

· Exclusive Rinse Guard™ clean-rinse agents keep dirt from resettling on clothes duringthe rinse cycle

· Super-concentrated formula costs less to use than national brands

Sol-U-Mel®

Three-in-one cleaner.

· Versatile all-purpose cleaner, cleaning booster, and deodorizer

· Contains the highest concentration of Melaleuca Oil of any cleaner on the market

· Cleans up all types of messes with an exclusive formula of naturally derived ingredients


MELALEUCA PHARMACY™

Pain relievers and natural first aid wonders that cost less than most grocery-storebrands and help heal wounds and infections with the wonder of Melaleuca Oil. Here are just a few of these exceptional products:

T36-C5™ and T40-C3™ Melaleuca OilAll-purpose first aid.

· At least 36% terpinen-4-ol to help kill germs, no more than 5% cineole to ensuregentle quality—the perfect balance of natural compounds

· Provides unparalleled effectiveness in treating minor cuts, scrapes, insect bites,infections, and burns

· The oil contains many natural properties—(1) antibacterial, (2) soothing, (3) penetrating, (4) non-caustic, (5) an effective solvent, (6) aromatic

Pain-A-Trate™

Muscle and joint pain relief.

· Deep-penetrating, patented formula that delivers relief for stiff joints, sore muscles,and cramps

· Contains three pain relievers, plus T36-C5 Melaleuca Oil

“Late one evening, my son fell off a booster seat and got a huge bruise and cut onhis cheek. I immediately applied T36-C5 Melaleuca Oil on the cut and then putTriple Antibiotic Ointment on a bandage on his cheek. The next afternoon weremoved the bandage and the cut was almost completely healed! It is trulyphenomenal how fantastic the products work!” *

Shawnda Horn, Oregon

“About three years ago, I developed a rash onthe palms of my hands. I tried to ignore it,but it got worse—cracking, bleeding, andpeeling. The doctor gave me a prescriptioncosting over $100, but it did not work.Nothing worked until I ordered DermaCort™.I could not believe what I saw—my handswere clearing up! I no longer have to hidemy hands and my husband has evenmentioned how soft my hands are now.Thank you so much for this product. Youhave improved my quality of life.” *

Judy Warnock, Oregon



NICOLE MILLERSkin care and cosmetic products that use natural vitamins, minerals, and plantextracts to promote healthy and beautiful skin. Here are just a few of ourexceptional products:

Nicole Miller Skin Care NecessitiesNatural skin care.

· Complete skin care system tailored for individual skin types—contains cleanser,toner, and moisturizer

· Nurturing supplement-strength vitamins and extracts leave skin clean and fresh

· Noticeably visible results

Nicole Miller TimelessAnti-aging serum.

· Skin solution that visibly reduces the signs of aging

· Supplement-strength vitamin C and provitamin A help maintain skin’s spring andyouthful glow

· Patented hydroxy complex gently exfoliates for renewed vibrance

“Since using Nicole Miller Skin Care, my oily skin has normalized and the

acne is gone. People are alwayscommenting on how good my skin

looks. I’ve used Nicole Miller for the pastthree years, and have not had to stop

using any of the products. I’ve never saidthat I’ve loved a skin care line before.

But I love Nicole Miller Skin Care.” *

Ruth Stringer, Director, Indiana

“Within two weeks of using Timeless, I noticed a significant change in my

skin. The clarity improved, skin toneevened out and smoothed out. It is

incredibly silky soft and has softened allthe lines on my face.” *

Anita Bamford, Senior Director II, Alberta

MELALEUCA AND NICOLE MILLER

No one understands skin care likeMelaleuca, and for over 17 yearsMelaleuca has been at the forefront ofskin care research, developing andcreating the finest quality skin careproducts in the world.

Nicole Miller is one of the top fashiondesigners in the world. The partnershipbetween Melaleuca and Nicole Millerhas resulted in skin care and cosmeticsthat are not only more effective,functional, and fashionable than otherleading brands, but they are also thehealthiest and most nourishingproducts available on the market today.

This marriage of science, women’sbeauty, and fashion has created theperfect product line to enhance thelives of women by helping them lookbeautiful, feel great about themselves,and maintain natural, healthy skin.


MELALEUCA BATH & BODYPersonal care and aromatherapy products to help reduce stress, promote beauty andrelaxation in the home, and care for the hair and skin with nature’s magic. Here are just a few of these exceptional products:

The Gold Bar®

Luxury bar.

· Premium glycerin luxury bar moisturizes, deep cleans, and fights odor

· Contains pure Melaleuca Oil to naturally cleanse and soften skin

· French milled to create a long-lasting, luxurious experience

Denti-Care™ Classic Tooth PolishNatural dental care.

· The only tooth polish on the market containing T36-C5™ Melaleuca Oil—a naturalantiseptic for healthy teeth and gums

· Natural propolis and myrrh remove plaque, stains, and bacteria with proper brushing

· Contains no sugar, triclosan, or fluoride for a natural, healthy, clean taste and clean-feeling gums and teeth

Advanced Expressions™

Salon-quality hair care.

· Contains exceptional ingredients, such as provitamin B, vitamin E, phytantriol, LipidReplenishing System, wheat germ protein, honey, and grape seed extract

· Style your hair with phytantriol, a unique heat-activated element that providesexceptional styling control while protecting your hair from heat-styling damage

· Protects your hair and hair color with an active shield made of four cutting-edge UV protectors

“When I first used The Gold Bar, I quicklyfelt the difference. It really cleansed mybody, and there was a better moisturizingeffect than from bars I had used before.”

Marc Selness, Executive Director IV, Minnesota

“Classic Tooth Polish does for people what no other product can do—keeps teethcleaner, longer. And it makes the mouthcomfortable almost immediately.”

Dr. Greg Romriell, DMD, Idaho



YOUR MEMBERSHIP BENEFITSAs a Preferred Customer, you’ll enjoy several advantages:

· Preferred Customer pricing—a 30%–40% discount off regular prices

· Advantage Reward Dollars—10% (14% CDN) back on all Product Point purchases

· Substantial savings on Melaleuca’s exclusive services and benefits; access to severalquality services such as Internet service, economical long distance, travel services,preferred credit card, health care savings card, travel savings card, vehicle savingsprogram, and more

· Free subscriptions to Melaleuca’s wellness and leadership publications

· 100% satisfaction guarantee

· The ease of ordering from a catalog and having products delivered directly to your home

· Website for 24-hour member access where you can find information on products,services, and business activities, plus download articles and brochures absolutely free

· Residual commissions through customers you introduce to Melaleuca

“We focus on health and wellness, the issues that people face in their homes, theirenvironment, and their physical health. We talk about our superior products andintroduce people to how to build a business from home. Melaleuca has all the toolsand resources you need, and as long as you follow the Seven Critical Activities andstay focused, it will lead to an incredible, enhanced life.”

Donna &Art Stewart, Executive Directors VI, Ontario

Whether you’re starting up a Melaleuca business or just looking forward to enjoying the products, Preferred Customer membership has tremendous advantages.

MELALEUCA’S PREFERREDCUSTOMER SERVICES

· iGlide.net® Premium Internetservice at an incredibly low price.

· MelaCom™ Rates as low as 4.5¢ perminute in the U.S. and 6¢ perminute in Canada.

· Melaleuca Card No annual feeand great low interest rates, plusother Preferred Customeradvantages that you can’t getanywhere else.

· HealthCare™ Savings ProgramSave hundreds of dollars every yearfrom hospital bills to physicians to dental care.

· Melaleuca Executive Travel™

Great rates on airfare, hotels,cruises, rental cars, and more.

· Travel Savings Card Enjoydiscounts of up to 20% on shopping,services, and restaurants and up to50% at selected hotels.

· Vehicle Savings Program Save thousands on your next vehicle purchase by letting us help you negotiate a lower price using our purchasing power on your behalf.

PREFERRED CUSTOMERMEMBERSHIP

PREFERRED CUSTOMER MEMBERSHIP AN INTRODUCTION TO MELALEUCA 20

In a world of economic uncertainty, Melaleuca’s work-from-home opportunity helpsmany families use their spare time to help others enjoy the benefits of healthpromoting products while earning the extra money they need.

Sometimes it helps to see the figures to determine what is needed to get out ofdebt and set up a comfortable retirement. Numbers in black and white can helpclarify the reality of your situation and help you to set more specific goals for thefuture. Take a look at the example below.

WHAT DO YOU NEED TO DO TOGET TOTALLY OUT OF DEBT?

If you’re looking for a way to earn extra money or reduce expenses, Melaleuca has the answer. With a straightforward, proven approach, Melaleuca gives

you the opportunity to get out of debt and enjoy life to its fullest.

SOMBER FACTS

The average American household has11 payment cards, including creditcards, debit cards, and store cards.

Americans are putting less money intosavings. U.S. personal savings rateshave decreased from nearly 8.5% in theearly 1980s to less than zero today.

Over 40% of U.S. families spend morethan they earn. (Federal Reserve)

Three out of five U.S. householdshave an average credit card balance ofmore than $11,000. Paying onlyminimum payments at 24% interest,it would take 22 years to pay it off—and interest would total $47,000.

Only 2% of homes in America arepaid for!

42% of the average household grossincome goes to pay interest alone. (U.S. Census Bureau)

Monthly To Pay Off Debt Owe Payment in 7 Years

Credit Cards $2,000 $50 $50

Automobile $22,000 $425 $425

Mortgage $130,000 $875 $1,875

Total $154,000 $1,350 $2,350

Early Payoff You will need an extra $1,000 per month for 7 years.

Retirement

To have an annual income of $70,000 during your retirement, you need $1 million

earning 7% interest when you retire.

To save enough You will need an extra $1,500 per month for the next 25 years.

21 AN INTRODUCTION TO MELALEUCA WHAT DO YOU NEED TO DO TO GET TOTALLY OUT OF DEBT?

Assuming you are 40 years old and can earn 7% return on your money, you willneed $12,000 per year or $1,000 per month to pay off your debt in 7 years. To save $1million for retirement, you will need $18,000 per year or $1,500 per month(assuming a non-tax-deferred investment) for 25 years. In total, you will need $2,500per month.

If your situation is similar to the example above, what are your plans forbringing in an additional $2,500 per month?

WHAT TYPE OFBUSINESS IS FOR YOU?

Perhaps you want to earn enough to pay for your Melaleuca products, make the car or house payment, or earn enough to get out of debt. Whatever your goal, Melaleuca has the answer.

Category 1—Preferred Customer

· I prefer naturally based products and want to make my home safer for myfamily and children.

· I want to improve my health and wellness.

· I’m not interested in a Melaleuca business right now, but I’m lookingforward to using quality Melaleuca products.

Category 2—Director $100US per month or more

· I’m excited about naturally based products and I’d like to earn enough to getthem free.

· I am comfortable with my family’s level of income, but I would like to make$100US or more per month to cover wellness-based products or other items.

· I’m not interested in building a large business at this time, but I can see howI could earn some extra money by sharing Melaleuca products with a fewfriends and family members.

How much money would you like to make with a Melaleuca business? How muchdesire do you have to get out of debt, pay off your mortgage, or help send yourchildren to college? Do you have an enduring entrepreneurial spirit, or are yousomeone who would just like to earn a little money on the side?

“ I fell in love with the Denti-Clean™ ClassicTooth Polish and Tough &Tender™, and I

found I couldn’t live without The VitalityPak.™ I loved the products so much, I began

to tell people about them. My first checkwas just $2, then $8, then $24, and then Ipaid for my product order with my checkfrom Melaleuca. I spent three years using

my Melaleuca business to pay for myproducts. However, as I told more friends,

my checks grew and I realized this wasreally a great business. Melaleuca has given

me the ability to be there for my childrenand help them pay for college.”

Barbara Rae, Executive Director III, Oregon

“I have been with Melaleuca for 12 years. I enrolled as a customer to get great

products. I decided everyone needed tohear about these products, so I started

telling everybody about them. I tried toenroll four people or more every month.

Melaleuca has afforded me such awonderful financial opportunity—over the

past 12 years Melaleuca has sent me over$200,000. A hundred dollars a month does

not sound like a lot, but that’s $1,200 a yearthat is not coming out of the budget.”

Debbie Denning, Director IV, Georgia

WHAT TYPE OF BUSINESS IS FOR YOU? AN INTRODUCTION TO MELALEUCA 22

Category 3—Director II–V $500US or more per month

· I care about purchasing healthy products and I’d like the chance to earn$300–$500US/month

· I would like to help my family, friends, and colleagues experience greatproducts while increasing my income enough to save for my children’scollege, remodel my home, or enjoy a few more leisure activities

· I have a few debts, like my mortgage and car payment, and I’d like to paythem down more quickly

· I am willing to devote 2–3 nights (5–10 hours) a week to building aMelaleuca business

Category 5—Executive Director and Above $10,000US or more per month

· I would like to be financially independent—I’m looking for a business thatcan support me and my family at a level of $10,000US or more per month

· I am prepared to spend 20+ hours per week working my Melaleuca business

· I want to get totally out of debt, including my mortgage

Category 4—Director V–Senior Director V $2,000US or more per month

· I’m very interested in building a business and I have a goal of earning$2,000US or more per month

· I have several loans and credit cards and I would like to get out of debt

· I can block out 3–4 nights a week (10–20 hours) for my Melaleuca business

“For 16 years, this has been a real familybusiness. You can maintain a true residualincome, and if you work a little harder, itwill grow. Many in our organization haveearned $500 or $1,000 a month for years.We have earned a six-figure income for 15out of the past 16 years. It’s absolutelychanged our lives. We were able to gettotally out of debt in three and a half years.We were the first to invite Frank to comeover and watch us burn our mortgage.We’ve been able to change our wholefinancial situation and lifestyle, and it’s been wonderful.”

Ron and Camille Frasure, Executive Directors III, Idaho

“I enrolled in November 1985 at the age of66, a year after most people retire.Melaleuca was only two months old at thetime and had only eight products, all basedon Melaleuca Oil. The first appeal was thesafety of the products. I was a nurse in ahospital and I saw so many children comein because of unsafe products. I had to let everyone know, especially parents withsmall children, that they needed safeproducts in their homes. It took me eightyears of consistent work to reachExecutive Director status, but I knew itwould be worth it. I have a much betterretirement than if I had stayed in nursing,I’m able to do so much more because Idon’t have financial worries. And I keeplearning new things and thoroughly enjoyworking with the company. It’s amazing tothink that I have earned 213 consecutivebonus checks from Melaleuca!"

Elizabeth Lindberg, Executive Director, Washington

23 AN INTRODUCTION TO MELALEUCA WHAT TYPE OF BUSINESS IS FOR YOU?

There is no limit to how much you can earn in your Melaleuca business. It’s all up toyou—your efforts, your time commitment, your ability to learn and duplicate provenmethods, and your dedication to success.

The faster you build your business and the more people who join your organization, the more success you will enjoy. Melaleuca offers a unique bonus tothose businessmen and women who move quickly soon after they enroll. You mayearn in two ways:

1. The Pacesetter Bonus rewards new enrollees and their enrollers for moving rapidlyto Director level.

2. The Pacesetter Leadership Bonus allows advancing Directors the opportunity todouble their one-time leadership bonuses through the Director levels, includingadvancement to Senior Director. The table below shows an example of thepotential income available when you follow the Pacesetter Program.

HOW MUCHCAN YOU EARN?

Once you’ve enrolled, determined your category and level of commitment, and reviewed your beginning checklist, you may wonder: What’s the next step?

EARNINGS IN ONE YEAR

Marketing executives in 2002 and2003 who achieved the status ofSenior Director and above on thePacesetter schedule earned significantincome from their Melaleucabusinesses (in U.S. dollars).

Low $24,139

High $324,728

Average $77, 717

Pacesetter Requirements* Potential Earnings†

Months Status Personal Enrollees

Personal Directors

Avg # of PCs in Org.

Org. & PersonallyEnrolled Customer

Commission

PacesetterBonus

Product Intro/V/C Pack

Commissions

Total Earnings

Leadership Pools, New CustomerBonuses, Other

1 and 2

3 and 4

5 and 6

7 and 8

9 and 10

11 and 12

D

D2

D3

D4

D5

SD

8

8

8

8

8

20

0

1

2

3

4

5

10

68

130

230

350

450

$81

$478

$867

$1,561

$2,355

$3,118

$8,460

$100

$500

$1,000

$2,000

$3,000

$4,000

$10,600

$382

$200

$223

$223

$223

$308

$1,560

$375

$675

$1,600

$2,230

$2,700

$4,400

$11,980

$938

$2,053

$3,790

$6,114

$8,478

$12,026

$33,400

* See the Melaleuca Compensation Plan in the Appendix for additional requirements.

† Earnings may vary based on the amount of Product Points purchased and the efforts of Marketing Executives. Assumes average of 48 Product Points.

For an accurate representation of what Marketing Executives earn with their Melaleuca business, see the Compensation Plan in the Appendix of your Business Kit or the Income Statistics in your New Horizons presentation.

All figures in U.S. dollars.

Total Year

HOW MUCH CAN YOU EARN? AN INTRODUCTION TO MELALEUCA 24

SAMPLE FIRST TWO MONTHS FOR CATEGORY 4S AND 5S Following is a realistic example of how much you can earn in your first two monthswith Melaleuca if you achieve the status of Director and Director II.

Earn $500+ Your First Month—Achieve Director

Enroll 10 customers (9 x $25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$225

Pacesetter Director Bonus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$100

4 customers buy Value Packs ($30/each) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$120

Product Introduction Bonus (20%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$140

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$585

Earn $1000+ Your Second Month—Achieve Director II

New customer bonus—Enroll 8 customers (7 x $25) . . . . . . . . . . . . . . . . . . . . . . . . . .$175

4 customers buy Value Packs ($30/each) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$120

4 Value Pack Assist Bonuses ($30/each) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$120

Product Introduction Bonus (20%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$120

Help Personal Enrollee Achieve Director . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$100

New Customer Bonus for Personal Enrollee’s enrollments . . . . . . . . . . . . . . . . . . . . .$350

Organization Commission (from 1st month enrollees) . . . . . . . . . . . . . . . . . . . . . . . . .$180

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$1,165

“I am amazed that I have leftbehind the times when I had touse credit cards just to buygroceries. Now I earn $25,000 to$45,000 a month. I understandwhat it is like to not have money,but from the beginning I investedin my business and found a way tomake it work. Society has taught usto settle—told us that we can’thave it all, and that we need to stop dreaming. Now I can teach my children to never stop dreaming.”

Ariana Reed-Hager, Executive Director IX, Missouri

“Whatever your goal, it’s here foryou if you’re willing to put forththe effort. You can reach your goals.We know—we did it.”

Bruce and Kirsten Newby, Executive Director IX, Michigan

All figures are in U.S. dollars. For an accurate representation ofwhat Marketing Executives earn with their Melaleuca business,see the Compensation Plan in the Appendix of your Business Kitor the Income Statistics in your New Horizons presentation.

25 AN INTRODUCTION TO MELALEUCA HOW MUCH CAN YOU EARN?

Product Introduction Commission: The first month you personally help newcustomers purchase Melaleuca products, you earn a commission of 20% or 27% of thetotal Product Points they purchase.

New Customer Bonus: As you personally enroll new customers (beginning withyour second enrollment in a calendar month), you earn a $25US bonus for every newcustomer who purchases in their first month.

Personal Enrollee Monthly Commission: Beginning with your personalcustomers’ second month purchases, you can earn 7%, 14%, 17%, or 20% of theProduct Points they purchase monthly.

Organization Commission: You earn a 7% commission on the Product Pointspurchased monthly by customers enrolled by others in your organization.

Value Pack and Career Pack Commissions: When customers you enroll or assist inenrolling purchase a Value Pack or Career Pack, you earn a $30US or $50US commission.

One-Time Advancement Bonus/Pacesetter Bonus: As you advance your businessto a new status, you qualify to earn one-time advancement bonuses for each newstatus you achieve. If you rapidly advance through the Director ranks, you qualify todouble each of these advancement bonuses and earn over $10,600US on just thePacesetter Bonus.

Leadership Development Bonus: As your personal enrollees advance to a newstatus, you earn up 20%, 40%, or 100% of the amount of their One-TimeAdvancement/Pacesetter Bonus.

Leadership Pools: As your business grows, you can participate in monthly companyrevenue sharing based on the increase of new customers in your organization.

Preferred Customer Services Commission: You can receive commissions oncommon everyday services you and the customers in your marketing organizationuse, like long-distance telephone service and credit card purchases.

Car Bonus: Senior Directors receive $400US monthly and Executive Directors receive$1000US monthly for a new automobile of choice.

COMPENSATIONWITH MELALEUCA

Following are several ways in which you can earn monthly commissions and bonuses as a Melaleuca Marketing Executive.

“We pinch ourselves every day, and are grateful for the MelaleucaCompensation Plan. It redistributes wealth to families in our community.Not everyone makes $10,000 amonth, but many make $200–$400 amonth, and that’s crucial for theirlives. By purchasing products everymonth, we know that we’re helpingother families just like ours.”

George Veronis, Executive Director, Pennsylvania

COMPENSATION WITH MELALEUCA AN INTRODUCTION TO MELALEUCA 26

“Nothing in the world can

take the place of

persistence. Talent will

not; nothing in the world

is more common than

unsuccessful men with

talent. Genius will not;

unrewarded genius is

almost a proverb.

Education will not; the

world is full of educated

derelicts. Persistence and

determination alone

are omnipotent!”

Calvin Coolidge,Former U.S. President

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