What is Diversion?
Diversion is the sale of any product(s) outside of the intended channels of professional distribution. Tanning products you find outside of a tanning salon are considered to be “diverted.” A “diverter” is someone who obtains the products outside the intended channel of distribution. The most common type of diversion is products being sold in the internet.

Where does diversion occur?
Diversion occurs when products are found in any outlet other than a tanning salon. These outlets often include websites, eBay retailers, discount stores, drugstores, grocery stores, flea markets, etc.

How does diversion occur?
Diversion can occur through distributors and even tanning salons who “look the other way” and sell directly to diverters. However, most diversion occurs through clandestine efforts of the diverter to trick our distributors into selling them the products.

Why do we fight diversion?
We fight diversion to:

• To allow consumers to receive the proper training and instruction on the use and benefits of our products.
• To ensure that the consumer only receives genuine products.
• To ensure that the products have not been tampered with or altered.
• To keep old or expired products out of the market.
• To ensure product safety.

Are diverted products safe to use?
Once a product has been diverted we cannot guarantee the safety of the product. Consumers who buy diverted products do so at their own risk. We have no way of ensuring that the diverted products have not been contaminated or altered.

What are we doing to stop diversion?
In order to ensure that consumers only receive the highest quality professional products appropriate for their specific tanning needs, we continue our decade-long commitment to aggressively combat diversion:

• In 2001, we implemented an aggressive anti-diversion campaign sending out hundreds of cease and desist letters to online sellers.
• We filed lawsuits against those internet retailers who refused to stop selling the products online. The lawsuits resulted in numerous businesses being permanently shut down by the courts. In 2009, we won a $6 Million verdict against a New York internet business. This victory followed a $5 Million verdict in 2003 against an Oklahoma internet business.
• Retained Net Enforcers to police all sales on eBay and remove auctions which use our intellectual property.
• Enforcing ongoing intelligence procedures uncover diversion schemes on the Internet.
• Exclusive product coding is being implemented in 2012 used to track the movement of products to identify and stop the source of products

What can I do to help stop diversion?
If you see one of our products for sale outside a tanning salon, please send us an e-mail to [diversion@australiangold.com] with the name of the website and any other information you may have collected. We will conduct a full investigation.

Writer's Direct Number: 317-554-4760
Fax: 317-554-3449
E-mail: tring@australiangold.com

July 5, 2011

Dear Valued Customers:

We want to thank you for choosing a professional tanning salon that offers one or more of our products in its salon. For several years, we have followed a salon only distribution policy, which means that our products are prohibited from being sold outside of professional tanning salons or directly to consumers online. We ask for your support in purchasing your lotions from your local salon. You may ask, "Why?

First we believe our products produce optimum results when chosen and sold by trained tanning salon professionals who best understand clients' tanning needs and objectives. These salons professionals are trained by our training staff and will ensure that you get the best product suited for your skin type and tanning needs.

Second, products which you may find online are many times counterfeit, contaminated, old or expired products that may not be safe to use. We often receive reports from dissatisfied consumers who have purchased products outside of their professional tanning salon, only to find it to be not genuine. Purchasing lotions from your tanning salon ensures that not only your salon, but the manufacturer, stands behind the quality of the product.

We thank you for your support of our brand and your local tanning salon.