Ambassador Compensation Plan YOUR STEP-BY-STEP GUIDE TO SUCCESS

Ambassador Compensation Plan YOUR STEP-BY-STEP GUIDE TO SUCCESS

Our Story 1992: two women, four manuscripts, four small children, London rain. Fast forward a year: two women, five small children, a publishing house. Fast forward a little further: more books, more children, rent, relationships criss-crossing England, North America, Asia, the world. It is received wisdom that owners of new enterprises should start with the end in mind. In our case, the end and the journey are the same: we want to live creatively, to combine parenting with business, to share stories, to prosper. We ve made some life-long friendships, fired the imagination of many thousands of children and had a lot of fun along the way. In a rapidly changing world, we think the best possible Ambassadors for Barefoot Books are people just like us: people who want to live on their own terms, are prepared to take risks, learn from the setbacks, keep smiling and keep growing. It s what you make of it, and it turns the world. Welcome to the Barefoot Books Ambassador community... let s have some fun! Table of Contents YOUR AMBASSADOR BUSINESS 2 UNDERSTANDING THE PLAN 3 Getting Started 3 Kickstart Bonuses 3 How You Earn 4 Personal Sales Bonus 5 Personal Team Bonus 5 Leadership at a Glance 6 STEPPING UP TO SUCCESS 7 Highlights 7 Ambassador 8 Ambassador Sales Leader 9 Level 1 Turquoise Team Leader 10 Level 2 Chartreuse Team Leader 11 Level 3 Amber Team Leader 12 Level 4 Saffron Team Leader 13 Level 5 Crimson Team Leader 14 Level 6 Amethyst Team Leader 15 QUESTIONS & ANSWERS 16 GLOSSARY 17 Nancy Traversy and Tessa Strickland Co-founders and moms of seven Barefoot children!

Your Ambassador Business Barefoot Books Ambassadors are a diverse community of parents, grandparents, teachers, librarians, storytellers, artists, musicians and entrepreneurs with a shared commitment to the importance of imagination and creativity in children s lives. Some work from home, some have part-time or full-time careers, some are retired. The Ambassador program is an exciting business opportunity where you can write your own success story building your business in a way that fits with your lifestyle, your family values and your personal interests. It s flexible, fun, creative and incredibly rewarding. GET STARTED IN 7 SIMPLE STEPS 1 Register to join the program 2 Gain access to your personal web office 3 Receive your beautiful Starter Kit 4 Connect with the Ambassador community 5 Dig into the comprehensive training materials Find out what drives you, learn new skills and meet like-minded people along the way. Bring stories to life and nurture the natural creativity in children with storytelling, creative crafts, music, puppets and more. Introduce families to global cultures. Raise funds for a cause that is important to you. The possibilities are endless! Your Ambassador compensation is directly linked to your own performance. You can earn through discounts and free gifts on all purchases, as well as from Personal, Team and Leadership Bonuses by: Selling Barefoot Books to your customers Building a team by sponsoring new Ambassadors Becoming a Sales or Team Leader Developing and motivating Leaders on your team 6 Plan your launch event 7 Begin to spread the word! I love the freedom to carve my own way, build my own business, write my own successes and learn from my own mistakes. LAURIE MATTALIANO Ambassador since 2005 Barefoot Books Ambassador Compensation Plan Your Ambassador Business 2

Understanding the Plan GETTING STARTED So what is your first step? Identify your goals. How much do you want to make, and how much time can you devote to your business? You may want to earn enough for a family getaway, contribute to tuition fees, pay off your debt or raise money for a cause that is important to you. You might be looking for a full-time income. Figuring out why you re doing this can be a big motivator down the road. If you are new to direct selling, setting attainable goals and taking action within your first 60 days will help you build momentum. You ll see yourself growing, learning and gaining confidence. As an independent consultant, you are free to run your Ambassador business in a way that suits you. However, one of the simplest and most effective ways that you can introduce Barefoot Books to new customers is by having a home party or sales event in your community. No matter how you choose to sell Barefoot Books or what types of events suit you best, most Ambassadors agree that consistency is the key. Having something on your calendar each week ensures that sales are coming in all the time and that you will have regular chances to share Barefoot Books and the Ambassador Opportunity. Don t forget! Planning four to six selling events duringyour first 60 days will help you to achieve your Kickstart Bonuses KICKSTART BONUSES As a new Ambassador you are eligible for three exciting Kickstart Bonuses, which will help you get your Barefoot Books business off to a great start. Here are the details: Kickstart 1 * SELL $300 PQV** in your 1 st 30 days EARN Bonus kit of books and gifts worth $150 Kickstart 2 * SELL Total of $600 PQV in 1 st 60 days EARN A 2 nd bonus kit of books and gifts worth $150 That s a total bonus of $300 in free products if you hit Kickstart 1 and 2! Kickstart 3 * ACHIEVE Kickstart 2 SPONSOR One new Ambassador in 1 st 60 days EARN An exclusive Barefoot Books table runner and 50 catalogs * Each Kickstart Bonus is sent out as it is achieved. **Personal Qualifying Volume. See glossary for more details. Barefoot Books Ambassador Compensation Plan Understanding the Plan 3

Understanding the Plan HOW YOU EARN With a 30% discount and up to 20% in free product on all personal orders, as well as the opportunity to earn Personal, Team and Leadership Bonuses each month, your Ambassador business is not only fun, but also rewarding! Take orders for Barefoot Books at home parties, community events, fundraisers or in one-on-one meetings, then log into your My Barefoot web office and choose an order option from the Orders and Shop drop down menu. Your Free Gift Allowance * is 15 20% in free products of your choice (all qualifying products), which you are awarded for each Personal Sales order that you place. Orders less than $300 (PQV) qualify for a 1 Free Gift Allowance Orders greater than, or equal to, $300 (PQV) qualify for a 20% Free Gift Allowance Select your Free Gift Allowance when you check out and use it in a way that suits your business. Here are some ideas: Provide free books for the library as part of a school book fair or fundraiser. Add your free products to your inventory for future sale to customers at full price. Use your free products to build your Barefoot Books library for display or samples. Offer your gifts to family and friends! Earnings Example 1 ** Ambassador places single monthly order < $300 Personal Qualifying Sales $200 Discount at purchase 30% = $60 Net purchase price $140 Free Gift Allowance 1 = $30 Personal Bonus 0% = $0 Total Profit $90 Let s assume the Ambassador above placed a Personal Qualifying order worth $400. With a 20% Free Gift Allowance, her profit on that order would increase substantially and she would also be eligible to receive a monthly Personal Sales Bonus, bringing her total profit up to $228. Earnings Example 2 ** Ambassador places single monthly order $300 Personal Qualifying Sales $400 Discount at purchase 30% = $120 Net purchase price $280 Free Gift Allowance 20% = $80 Personal Bonus 10% = $28 Total Profit $228 * Your Free Gift Allowance must be spent in the order in which it is earned. Any unused Free Gift Allowance will not be carried over, and will expire once the order is placed. ** For illustrative purposes only; this is not a guarantee of income. Plan compensation is based on your actual performance. Barefoot Books Ambassador Compensation Plan Understanding the Plan 4

Understanding the Plan PERSONAL SALES BONUS If you are Bonus Qualified you have achieved at least $300 in Personal Qualifying Volume (PQV) in the month you are eligible for a Personal Sales Bonus. This is an additional 10% calculated on the Bonus Volume (BV) of your monthly Personal Qualifying sales, which is the retail value minus your 30% upfront discount. You can earn up to 1 in Personal Sales Bonus by becoming an Ambassador Sales Leader. SALES PERSONAL SALES BONUS $300 to $599.99 earn 10% personal sales bonus $600 to $999.99 earn 12. personal sales bonus * $1000 or more earn 1 personal sales bonus * Earnings Example ** LEVEL Ambassador (PQV < $600) Ambassador Sales Leader (PQV $600 and < $1000) Ambassador Sales Leader (PQV $1000) PERSONAL QUALIFYING VOLUME (PQV) 30% UP-FRONT DISCOUNT BONUS VOLUME (BV) PERSONAL SALES BONUS (%) $500 $150 $350 10% $35 $800 $240 $560 12. $70 PERSONAL SALES BONUS ($) $1200 $360 $840 1 $126 PERSONAL TEAM BONUS When you become a Barefoot Books Ambassador, you will be joining a global community of thousands of like-minded people who are all defining success in their own way. Many Ambassadors love to help other Ambassadors by sponsoring and mentoring a team, making friendships that can last a lifetime along the way. Build your team wide and deep, and offer the opportunity to everyone in your community. In addition to the camaraderie and support you get by growing, supporting and coaching your personal team, you will be eligible to earn an extra Personal Team Bonus on these personally-sponsored team members. These bonuses are based on the Bonus Volume of your team members sales. The moment you sponsor your first Ambassador, you ve begun building your own team. Sponsoring enables you to teach others to do what you re doing and extend your reach. Climb the Team Leadership Ladder and watch your earnings grow even more! Personal and Team Bonuses are calculated after the month end closes and the commissions are run. You should receive your commission statement via email, and online in your Ambassador Business Centre, within five business days, and payment should reach your account within 10 14 business days from the end of the month. * Must qualify as an Ambassador Sales Leader to earn. ** For illustrative purposes only; this is not a guarantee of income. Plan compensation is based on your actual performance. Barefoot Books Ambassador Compensation Plan Understanding the Plan 5

Understanding the Plan LEADERSHIP AT A GLANCE There are two paths to Leadership in the Ambassador Program. Become an Ambassador Sales Leader by achieving a consistent monthly sales threshold, or build your team and climb the Ambassador Team Leadership Ladder. Better still, why not aim for both? Once you become an Ambassador Leader, you ve crossed the threshold to a very important role within our community. While there are many benefits to becoming an Ambassador Leader, there are additional expectations of you as well. Leadership Benefits: Increased earnings potential Access to Leaders-only forum Access to monthly Leader-only conference calls. Access to weekly Leader-only e-chats. Participation in the Team Leaders roundtable at annual Conference. Remember to be positive your team members will follow your lead! One free copy of each new title when you qualify for or maintain Team Leader status at Level 3 Amber or above during Jan Jun or Jul Dec, respectively, of any given year Leadership Expectations: Share your expertise with the wider community in meetings, workshops and conferences. Lead by example! Commit to achieving all company-sponsored incentives and challenges. SELLING RETENTION SPONSORING Four Behaviors of a Successful Leader Maintain a consistent schedule of events strong personal sales and networking are the foundation of success. Develop a team that is both wide and deep, and teach your team members to do the same. Coach and mentor your team, recognizing their successes and offering them regular training. BUILDING LEADERS Create a consistent method of team communication with team emails and newsletters with the latest programs, promotions, incentives and, most importantly, team recognition. Always strive to be a positive voice in the Ambassador community! Barefoot Books Ambassador Compensation Plan Understanding the Plan 6

Stepping Up to Success HIGHLIGHTS Easy Steps. Build your Ambassador business your way! Make it fit your lifestyle, your family values and your personal interests. Earnings. Earn 30% profit on your Personal Sales, 1 20% in free product on every personal order, and Kickstart and Personal Sales Bonuses if you qualify. $1000 $3000 REWARDS Build your Team. Earn Personal Team Bonuses when you introduce others to the Ambassador opportunity. Leadership Ladder. Become a Sales Leader and earn higher Personal Sales Bonuses. Climb the Team Leadership Ladder and earn even more! 12.5 1 10 1 10 1 10 1 $500 10 1 10 1 10 1 CASH BONUS 2 ND GENERATION LEADERSHIP BONUS 1 ST GENERATION LEADERSHIP BONUS CENTRAL TEAM BONUS 10% PERSONAL SALES BONUS PERSONAL TEAM BONUS 30% 30% 30% 30% 30% 30% 30% 30% UPFRONT DISCOUNT 15 20% 15 20% 15 20% 15 20% 15 20% 15 20% 15 20% 15 20% FREE GIFT ALLOWANCE Ambassador Ambassador Sales Leader Turquoise Team Leader Chartreuse Team Leader Amber Team Leader Saffron Team Leader Crimson Team Leader Amethyst Team Leader Bonus Qualify $600 in PQV Bonus Qualify $2,500 in TQV Three or more team members* Bonus Qualify $2,500 in TQV Three or more team members* One 1 st Generation Breakaway Leader Bonus Qualify $2,500 in TQV Three or more team members* Two 1 st Generation Breakaway Leaders Bonus Qualify $2,500 in TQV Three or more team members* Four 1 st Generation Breakaway Leaders Bonus Qualify $2,500 in TQV Three or more team members* Six 1 st Generation Breakaway Leaders Bonus Qualify $2,500 in TQV Three or more team members* Eight 1 st Generation Breakaway Leaders REQUIREMENTS Bonus Qualify = $300 in personal qualifying volume each month PQV = Personal Qualifying Volume TQV = Team Qualifying Volume *team members must be personally sponsored and active Barefoot Books Ambassador Compensation Plan Stepping Up to Success 7

Stepping Up to Success AMBASSADOR On the first step of your Ambassador journey, you earn 30% profit and 15 20% in free product with every order you place. You also have the opportunity to earn compelling Kickstart Bonuses and an additional 10% Personal Sales Bonus each month. And the moment you introduce the Ambassador opportunity to others and begin to build your team, you can earn a Personal Team Bonus on your personally-sponsored team members sales. Monthly Qualifications: Active Ambassador status $300 BV $400 BV $600 BV $700 BV There is no sales threshold to remain an active Ambassador! This is an opportunity to make income in a way that fits your family needs and life. $300 or more Personal Qualifying Volume (PQV) Monthly Rewards: 30% profit on purchases of qualifying products KEY Personal Team Total Personal Team Bonus Volume $2,000 30% commission on online Referral Sales carrying your Ambassador ID (calculated on net value of shopping cart, less any special offers) 1 to 20% Free Gift Allowance 10% Personal Sales Bonus Personal Team Bonus on the BV of your personally-sponsored team members sales Earnings Example * Monthly Personal PQV $600 Upfront Discount 30% = $180 Monthly Personal BV $420 Personal Sales Bonus 10% = $42 Personal Team Bonus** = $80 Total Profit $302 (excludes Free Gift Allowance) * For illustrative purposes only; this is not a guarantee of income. Plan compensation is based on your actual performance. ** Personal Team Bonus x Total Personal Team Bonus Volume $2000 = $80 Barefoot Books Ambassador Compensation Plan Stepping Up to Success 8

Stepping Up to Success AMBASSADOR SALES LEADER Personal sales are the foundation of success for a Barefoot Books Ambassador. When your focus is on marketing and selling Barefoot Books, you make money, you inspire your team members to make money, and everyone is encouraged to build their businesses. As an Ambassador Sales Leader you enjoy the perks of being an important member of our Leaders community and you also benefit from a higher monthly Personal Sales Bonus. Sell $600 or more in Personal Qualifying Volume (PQV) and earn 12.; sell $1,000 or more and your Personal Sales bonus increases to 1! Monthly Qualifications: $300 BV $400 BV $600 BV $700 BV Be consistent with your monthly sales to achieve higher personal bonuses and other Leadership perks. $600 or more in Personal Qualifying Volume (PQV) (maintain for two consecutive months prior to promotion) Monthly Rewards: KEY Personal Team Total Personal Team Bonus Volume $2,000 As Ambassador, plus: Increase to 12. Personal Volume Bonus if PQV is $600 but < $1,000 (higher bonus paid in second consecutive month of meeting PQV goal) Increase to 1 Personal Volume Bonus if PQV is $1,000 (higher bonus paid in second consecutive month of meeting PQV goal) Earnings Example * Monthly Personal PQV $1200 Upfront Discount 30% = $360 Monthly Personal BV $840 Personal Sales Bonus 1 = $126 Personal Team Bonus** = $80 Total Profit $566 (excludes Free Gift Allowance) * For illustrative purposes only; this is not a guarantee of income. Plan compensation is based on your actual performance. ** Personal Team Bonus x Total Personal Team Bonus Volume $2000 = $80 Barefoot Books Ambassador Compensation Plan Stepping Up to Success 9

Stepping Up to Success LEVEL 1 TURQUOISE TEAM LEADER When you have at least three active Ambassadors on your team, you can become an Ambassador Team Leader and begin earning to on your entire Central Team. You are selling products to customers, sponsoring others to join your team and encouraging your team to sell and their sales now become part of your Team Qualifying Volume (TQV). Team Qualifying Volume includes your own PQV and also the PQV of all members of your Central Team. Monthly Qualifications: Become a Team Leader and start earning, not only on your Personal Team members, but also on your entire Central Team! Three or more personally-sponsored active team members $300 or more Personal Qualifying Volume (PQV) (maintain for two consecutive months prior to promotion) $2,500 or more Team Qualifying Volume (TQV) (maintain for two consecutive months prior to promotion) Monthly Rewards: As Ambassador, plus: Central Team Bonus on all members of your Central Team below the rank of Leader, including personally-sponsored team members KEY Central Team 1 st Generation Breakaway Personal Team 2 nd Generation Breakaway Barefoot Books Ambassador Compensation Plan Stepping Up to Success 10

Stepping Up to Success LEVEL 2 CHARTREUSE TEAM LEADER Teaching your team members to sell and sponsor is the next step. When a team member meets the criteria to become a Team Leader themselves, they become your 1 st Generation Breakaway, and you are eligible to earn to 11% on their Central Team sales. Monthly Qualifications: One 1 st Generation Breakaway Leader Three or more personally-sponsored active team members $300 or more Personal Qualifying Volume (PQV) 11% A Breakaway is someone in your Central Team (either personally sponsored by you or not) who meets the Team Leader criteria and promotes out from your team. $2,500 or more Team Qualifying Volume (TQV) Monthly Rewards: As Level 1 Turquoise Team Leader, plus: 1 st Generation Leadership Bonus on your promote-out Leader s combined Central Team BV (11% if your breakaway leader is personally sponsored by you) KEY Central Team 1 st Generation Breakaway Personal Team 2 nd Generation Breakaway Barefoot Books Ambassador Compensation Plan Stepping Up to Success 11

Stepping Up to Success LEVEL 3 AMBER TEAM LEADER The rewards of Leadership come in many forms: you earn more and have access to exciting perks such as free products and sneak peeks. You also have the opportunity to work collaboratively with your team members to achieve mutual goals. As two of your team members are promoted to Team Leader status, you now have the ability to earn on your 1 st and 2 nd Generation Breakaways. Monthly Qualifications: Two 1 st Generation Breakaway Leaders Three or more personally-sponsored active team members $300 or more Personal Qualifying Volume (PQV) $2,500 or more Team Qualifying Volume (TQV) Monthly Rewards: As Level 1 Turquoise Team Leader, plus: 1 st Generation Leadership Bonus on Central Team BV of each of your 1 st Generation Breakaway Leaders 2 nd Generation Leadership Bonus on Central Team BV of each of your 2 nd Generation Breakaway Leaders 11% 11% If one of the team members in your 1 st Generation becomes a Team Leader and breaks away, this person becomes your 2 nd Generation Breakaway. KEY Central Team Personal Team 1 st Generation Breakaway 2 nd Generation Breakaway Barefoot Books Ambassador Compensation Plan Stepping Up to Success 12

Stepping Up to Success LEVEL 4 SAFFRON TEAM LEADER You ve honed your selling skills and you are sharing the Ambassador opportunity with your contacts. You ve supported and motivated at least four team members to break away and become Ambassador Team Leaders themselves. Congratulations are in order! You ve demonstrated true leadership, and the rewards reflect your achievement with the addition of a $500 cash bonus each month that you maintain this Leadership level. Monthly Qualifications: Four 1 st Generation Breakaway Leaders Three or more personally-sponsored active team members 11% You should always continue to sponsor and promote new Ambassador Team Leaders to maximize your earnings and rise up the Leadership Ladder. $300 or more Personal Qualifying Volume (PQV) $2,500 or more Team Qualifying Volume (TQV) Monthly Rewards: As Level 1 Turquoise Team Leader, plus: 1 st Generation Leadership Bonus on Central Team BV of each of your 1 st Generation Breakaway Leaders 2 nd Generation Leadership Bonus on Central Team BV of each of your 2 nd Generation Breakaway Leaders 11% 11% $500 Cash Bonus paid each month KEY Central Team 1 st Generation Breakaway Personal Team 2 nd Generation Breakaway Barefoot Books Ambassador Compensation Plan Stepping Up to Success 13

Stepping Up to Success LEVEL 5 CRIMSON TEAM LEADER With six 1 st Generation Breakaways, you are nurturing a thriving team of Leaders. In addition to earning on your Central Team and your 1 st and 2 nd Generation breakaways, your cash bonus also increases to $1,000 a month. Monthly Qualifications: Six 1 st Generation Breakaway Leaders Three or more personally-sponsored active team members $300 or more Personal Qualifying Volume (PQV) $2,500 or more Team Qualifying Volume (TQV) Monthly Rewards: As Level 1 Turquoise Team Leader, plus: 1 st Generation Leadership Bonus on Central Team BV of each of your 1 st Generation Breakaway Leaders 2 nd Generation Leadership Bonus on Central Team BV of each of your 2 nd Generation Breakaway Leaders $1,000 Cash Bonus paid each month 11% KEY Central Team 11% 11% 11% 1 st Generation Breakaway Monthly qualifications are minimums; top performers always set personal goals to achieve more than the minimums. Personal Team 2 nd Generation Breakaway Barefoot Books Ambassador Compensation Plan Stepping Up to Success 14

Stepping Up to Success LEVEL 6 AMETHYST TEAM LEADER Your earning potential continues to expand as eight of your team members are promoted to Ambassador Team Leader and become 1 st Generation Breakaways. Your monthly cash bonus is now $3,000, and you continue to earn on both your 1 st and 2 nd Generation Breakaways. By focusing on your personal sales and recruiting efforts, you maintain your Amethyst Team Leader Level 6 status and maximize your income. Monthly Qualifications: Eight 1 st Generation Breakaway Leaders Three or more personally-sponsored active team members $300 or more Personal Qualifying Volume (PQV) $2,500 or more Team Qualifying Volume (TQV) Monthly Rewards: As Level 1 Turquoise Team Leader, plus: 1 st Generation Leadership Bonus on Central Team BV of each of your 1 st Generation Breakaway Leaders 2 nd Generation Leadership Bonus on Central Team BV of each of your 2 nd Generation Breakaway Leaders $3,000 Cash Bonus paid each month 11% 11% KEY 11% Central Team Personal Team 11% 11% 1 st Generation Breakaway 2 nd Generation Breakaway Congratulations! You have reached the top of the Leadership Ladder. Continue to grow your earnings by building your personal team and mentoring your Leaders. Barefoot Books Ambassador Compensation Plan Stepping Up to Success 15

Questions & Answers 1. Is there a minimum level of sales I need to remain an active Ambassador? There is no sales threshold to remain active as an Ambassador! The Barefoot Books Ambassador program is an opportunity to make income in a way that fits your family needs and life. We want to support every Ambassador who joins the community with a different goal in mind. Not requiring a certain minimum in sales gives Ambassadors the flexibility and freedom to run their business in their own way. 2. Are there any recurring fees? There is a yearly Ambassador Renewal Fee of $49.99 to stay in the program. This fee is waived for the first year, and all Ambassadors will be charged the fee on their joining anniversary date. 3. Can I earn Free Gift Allowance on all sales? You do not earn a Free Gift Allowance on your referral sales, only on orders that you place personally on the Barefoot Books website. Also, Sales Aids and other non-qualifying products cannot be purchased with your Free Gift Allowance. 4. Are there any geographic limitations to joining or building a team in North America? No, you can sell and sponsor in your own backyard or anywhere across the United States or Canada. 5. Can I earn additional commissions on Barefoot Books website sales that aren t tied to a specific Ambassador? Yes, the referral commission on all unattached Barefoot Books website sales is allocated to Ambassadors at the end of the month, pro-rata based on their own Personal Qualifying Volume in the month. Please see our Ambassador Reference Guide online for a more comprehensive list of Questions and Answers on the Ambassador Program. 6. What are the benefits of becoming an Ambassador Sales or Team Leader? As a Leader, you are eligible to participate in special Leaders-only forums and in regular Leaders chats and conference calls. You will have access to in-depth, one-on-one Leadership training, sneak previews of new products in the pipeline, and insight into upcoming Community and Program developments. You also enjoy additional perks as you climb the Leadership Ladder. 7. Can I be recognized as both a Sales Leader and a Team Leader? Yes, if you meet the required Personal Sales qualification levels as well as the Team Leadership thresholds, you can be a Sales Leader and a Team Leader at the same time. 8. What happens when I get promoted to one of the Team Leadership levels? If you achieve Team Leadership status in a given month, you are promoted and paid bonuses at your new level in that month. Your up-line sponsor will also be paid based on her new level in that month. 9. What happens when one of my team members breaks away and my Team Qualifying Volume (TQV) is not high enough for me to earn as a Team Leader? There is a two month grace period beginning in the month that the Leader promotion happens. In this period, the promoting-out Leader only needs to have TQV of $1,500 or more in order to qualify as a Team Leader. 10. What happens when an Ambassador who has team members leaves the program? When an Ambassador retires or becomes inactive, her entire down line compresses up to her immediate Team Leader. This Team Leader will not receive the Personal Team Bonus on the retiring Ambassador s personallysponsored team members. Barefoot Books Ambassador Compensation Plan Questions & Answers 16

Glossary Bonus Qualified: Ambassadors are Bonus Qualified when they achieve at least $300 in total monthly Personal Qualifying Volume (PQV). When you are Bonus Qualified, you are eligible to earn monthly Personal, Team and Leadership Bonuses. Bonus Volume (BV): On personal sales, this is calculated by subtracting your 30% upfront discount from your total Personal Qualifying Volume (PQV). For example, on PQV of $300, the BV would be $210, or 70%. BV on Referral Sales is calculated by subtracting the 30% commission you receive on your customers net sales. Monthly bonuses are calculated based on BV, not PQV. Central Team: Anyone you ve sponsored and anyone they ve sponsored (and so on) who is not a part of a Breakaway Leader s team. Central Team Bonus: The bonus paid on the combined sales of all members of your Central Team below the rank of Team Leader, including personally-sponsored team members. Grace Period: The two month grace period begins in the month that you promote out a Team Leader. During this period, you only need to have Team Qualifying Volume (TQV) of $1,500 or more in order to qualify as a Team Leader. Personal Qualifying Volume (PQV): Your PQV is the combination of personal qualifying orders that you place on the Barefoot Books website and your Referral Sales, and is based on the recommended retail, or special offer, price of any qualifying products. PQV is used to determine eligibility for monthly Personal, Team and Leadership Bonuses and also if you meet the Active Threshold. Personal Volume Bonus: 10% to 1 additional bonus paid on the BV of your Personal Qualifying Volume and earned if you are Bonus Qualified. Personal Team: All active team members whom you have personally sponsored, i.e. they are directly linked to you. Personal Team Bonus: This is a bonus paid on the BV of each of your personally-sponsored active team members, if you are Bonus Qualified. As a Team Leader, you earn a total of on your personal team s sales ( Personal Team Bonus plus Central Team Bonus). The Personal Team Bonus is paid even if one of your personal team members qualifies to break away as a Team Leader. If a sponsoring Ambassador leaves the business, the Personal Team Bonus will not be paid to anyone. Qualifying Products: Mainly items that are intended for resale and exclude Sales Aids, products purchased with your Free Gift Allowance, Starter Kits and Kickstart Bonuses. Referral Sales: Online orders which carry your Ambassador ID. You earn a 30% commission, payable at the end of the month, on the net value, after any special offer discounts, of your Referral Sales. Team Qualifying Volume (TQV): The combination of your Personal Qualifying Volume (PQV) and your Central Team Volume. Team Leaders qualify for Central Team and Leadership bonuses if their TQV is $2,500 or higher. 1 st Generation Breakaway: A member of your Central Team who qualifies as a Team Leader and breaks away. You earn a bonus on the combined Central Team BVs of your 1 st Generation Breakaway Leaders. 2 nd Generation Breakaway: If a member of your 1 st Generation Breakaway promotes out, this person becomes your 2 nd Generation Breakaway. You earn a bonus on the combined Central Team BVs of your 2 nd Generation Breakaway Leaders. Barefoot Books Ambassador Compensation Plan Glossary 17

Never doubt that a small group of thoughtful, committed people can change the world. Indeed, it is the only thing that ever has MARGARET MEAD