Lawsuits

Mary Kay’s Letter on the Robin Blackmon-Dunda Termination

Following the termination of high-ranking sales director Robin Blackmon-Dunda, Mary Kay Cosmetics sent out this letter to its national sales directors.

August 29, 2006

Dear Independent National Sales Director,

Some of you have contacted us recently concerning how to respond when the Company makes a decision affecting an independent sales force member’s contractual relationship with the Company. We sincerely appreciate your heartfelt concerns and comments. We also hope you know how important it is that we endeavor to protect the individual’s privacy; therefore, we are reluctant to disclose details of a specific situation. However, I do believe it is important to provide you with helpful information when sales force members within your National Area approach you with questions.

Our goal is to help everyone build and maintain trust and confidence in this business. Whether it’s the individual or the Company that ends the relationship, we hope that the details of the situation would be considered as a private matter between the two parties. In situations where the Company ends a relationship, I can promise you that we never take a decision like that lightly. Generally it is only after repeated unsuccessful attempts to help someone understand she is doing something wrong, do we ever get to the point where the Company feels we need to terminate a relationship.

When it comes to situations regarding contractual violations, we want to give every sales force member an opportunity to learn and become better and stronger. We strive to work with each sales force member to educate them, test for understanding, and offer opportunities to correct the situation. Further, we strongly urge discussion with the Company for clarification of their responsibilities before action is taken.

Once a final decision is made, it is important to turn our attention to the other Independent Beauty Consultants, Sales Directors, and National Sales Directors that continue to work their Mary Kay business and remain focused on reaching their goals. What we all do and say will determine how well and how quickly everyone moves forward. Your positive support and confidence are vital to ensure the Mary Kay opportunity will remain as strong as ever. As Mary Key said, “It’s not so much what happens to us as how we react to what happens that makes the difference.”

We count on you to trust and respect our decisions knowing that our goal is to always act in the best interest of Mary Kay as a whole. At the same time, I encourage you to try to be understanding of the feelings of others who may be struggling with a decision. And of course, anytime questions arise that you feel you can’t answer, please share that we are available to answer questions for any sales force member regarding their personal business practices.

As always, please don’t hesitate to call if you have questions.

Thank you for your love and support,

Darrell Overcash

President, U.S.

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