UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   SCHEDULE TO

            Tender Offer Statement under Section 14(d)(1) or 13(e)(1)
                     of the Securities Exchange Act of 1934

                          Pre-Paid Legal Services, Inc.
                       (Name of Subject Company (Issuer))

                          Pre-Paid Legal Services, Inc.
                       (Name of Filing Person, the Issuer)

                          COMMON STOCK, $0.01 PAR VALUE
                         (Title of Class of Securities)

                                   740065 107
                      (CUSIP Number of Class of Securities)

                                   Randy Harp
                             Chief Operating Officer
                          Pre-Paid Legal Services, Inc.
                                One Pre-Paid Way
                               Ada, Oklahoma 74820
                                 (580) 436-1234
                  (Name, address and telephone number of person
               authorized to receive notices and communications on
                            behalf of filing person)

                                 with a copy to:
                            Michael M. Stewart, Esq.
                   Crowe & Dunlevy, A Professional Corporation
                          20 North Broadway, Suite 1800
                             Oklahoma City, OK 73102
                                 (405) 235-7700

                            CALCULATION OF FILING FEE

Transaction valuation*                                  Amount of filing fee
----------------------                                  --------------------
$26,000,000.00                                                     $3,294.24

* Calculated  solely for purposes of  determining  the filing fee, in accordance
with Rule 0-11 of the Securities  Exchange Act of 1934. This calculation assumes
the purchase of 1,000,000 of common stock of Pre-Paid  Legal  Services,  Inc. at
the maximum tender offer purchase price of $26.00 per share in cash.

[ ]  Check  the  box if any  part  of the  fee is  offset  as  provided  by Rule
0-11(a)(2)  and identify the filing with which the offsetting fee was previously
paid. Identify the previous filing by registration statement number, or the Form
or Schedule and the date of its filing.

Amount Previously Paid: N/A
Form or Registration Number: N/A
Filing Party: N/A Date Filed: N/A

[ ] Check the box if the filing  relates  solely to  preliminary  communications
made before the commencement of a tender offer.

Check the  appropriate  boxes below to designate any  transactions  to which the
statement relates:

[ ] third party tender offer subject to Rule 14d-1.
[X] issuer tender offer subject to Rule 13e-4.
[ ] going private transaction subject to Rule 13e-3.
[ ] amendment to Schedule 13D under Rule 13d-2.

Check the following box if the filing is a final amendment reporting the results
of a tender offer: [ ]



This Tender Offer Statement on Schedule TO relates to the issuer tender offer of
Pre-Paid  Legal  Services,  Inc.,  an  Oklahoma  corporation,  to purchase up to
1,000,000 shares of its common stock, $0.01 par value per share.  Pre-Paid Legal
Services,  Inc. is offering to purchase these shares at a price not greater than
$26.00  nor less than  $22.50  per  share,  net to the  seller in cash,  without
interest, upon the terms and subject to the conditions set forth in the Offer to
Purchase,  dated August 26, 2004, (the "Offer to Purchase"),  and in the related
Letter of  Transmittal,  which,  as amended or  supplemented  from time to time,
together constitute the tender offer. This Tender Offer Statement on Schedule TO
is intended to satisfy the reporting  requirements  of Rule  13e-4(c)(1)  of the
Securities Exchange Act of 1934, as amended.

The information in the Offer to Purchase, filed herewith as Exhibit 1, is hereby
incorporated by reference in response to all the items of this Schedule TO.

Item 1.  Summary Term Sheet.

The information  under the heading "Summary Term Sheet" in the Offer to Purchase
is incorporated herein by reference.

Item 2.  Subject Company Information.

(a) The name of the subject company is Pre-Paid Legal Services, Inc. The address
and telephone number of its principal  executive  offices are: One Pre-Paid Way,
Ada, OK 74820, (580) 436-1234.

(b) The subject  securities are common stock, $0.01 par value, of Pre-Paid Legal
Services,  Inc. The number of shares of the subject securities outstanding as of
August 25, 2004 is 16,460,515.

(c)  Information  about the trading  market and price of the subject  securities
under "Section 8. Price Range of Shares;  Dividends" of the Offer to Purchase is
incorporated herein by reference.

Item 3.  Identity and Background of Filing Person.

(a) The filing person to which this Schedule TO relates is the subject  company.
For  information  about  the  subject  company,  see Item 2. Each  director  and
executive officer of Pre-Paid Legal Services, Inc. is listed below.

Harland C. Stonecipher     Chairman of the Board of Directors, Chief Executive
                             Officer and President
Randy Harp                 Chief Operating Officer
Kathleen S. Pinson         Vice President of Regulatory Compliance and Secretary
Steve Williamson           Chief Financial Officer
Martin H. Belsky           Director
Peter K. Grunebaum         Director
Steven R. Hague            Director
John W. Hail               Director

Item 4.  Terms of the Transaction.

(a)-(b)  Information  about the terms of the  transaction  under  "Summary  Term
Sheet,"  "Section  1.  Number of  Shares;  Priority  of  Purchases;  Proration,"
"Section 2. Tenders by Holders of Fewer than 100 shares,"  "Section 3. Procedure
for Tendering  Shares,"  "Section 4. Withdrawal  Rights," "Section 5. Acceptance
for Payment of Shares and Payment of Purchase  Price,"  "Section 6.  Conditional
Tender of Shares," "Section 7. Conditions of the Offer," "Section 11. Source and
Amount of Funds," "Section 13. Legal Matters;  Regulatory  Approvals,"  "Section
14. Certain Federal Income Tax  Consequences,"  "Section 15. Extension of Tender
Period;  Termination;  Amendments,"  and "Section 16. Fees and Expenses," of the
Offer to Purchase is incorporated herein by reference.

There will be no material  differences  in the rights of  security  holders as a
result of this transaction.

Item 5.  Past Contracts, Transactions, Negotiations and Agreements.

(e)  Information   under  "Section  12.  Interest  of  Directors  and  Officers;
Transactions  and  Arrangements  Concerning  Shares" of the Offer to Purchase is
incorporated herein by reference.

Item 6.  Purposes of the Transaction and Plans or Proposals.

(a)-(b) The information about the purpose of the transaction under "Summary Term
Sheet" and "Section 9. Purpose of the Offer;  Certain  Additional Effects of the
Offer,  Plans and Proposals" of the Offer to Purchase is incorporated  herein by
reference.

(c) The  information  about plans or proposals  under "Section 8. Price Range of
Shares; Dividends," "Section 9. Purpose of the Offer; Certain Additional Effects
of the Offer,  Plans and  Proposals,"  "Section 12.  Interest of  Directors  and
Officers;  Transactions  and  Arrangements  Concerning  Shares"  of the Offer to
Purchase is incorporated herein by reference.

Item 7.  Source and Amount of Funds or Other Consideration.

(a), (b) and (d) The information  under "Section 11. Source and Amount of Funds"
of the Offer to Purchase is incorporated herein by reference.

Item 8.  Interest in Securities of the Subject Company.

(a) The  information  under  "Section 12.  Interest of Directors  and  Officers;
Transactions  and  Arrangements  Concerning  Shares" of the Offer to Purchase is
incorporated herein by reference.

(b) The  information  under  "Section 12.  Interest of Directors  and  Officers;
Transactions  and  Arrangements  Concerning  Shares" of the Offer to Purchase is
incorporated herein by reference.

Item 9.  Persons/Assets, Retained, Employed, Compensated or Used.

(a) The  information  under  "Summary  Term  Sheet" and  "Section  16.  Fees and
Expenses" of the Offer to Purchase is incorporated herein by reference.

Item 10. Financial Statements.

(a)-(b)  Not  applicable.  The  tender  offer is not  subject  to any  financing
condition and the offeror is a public  reporting  company under Section 13(a) or
15(d) of the Exchange Act that files reports  electronically on EDGAR.  However,
the offeror has elected to provide  certain pro forma  financial  information in
"Section 10.  Information  Concerning  Pre-Paid Legal  Services" of the Offer to
Purchase.

Item 11. Additional Information.

(a)(1) Not applicable

(a)(2) None

(a)(3) Not applicable

(a)(4) Not applicable

(a)(5) None

(b) None

Item 12. Exhibits.

The following exhibits are submitted herewith:

         (a)(1)(i) Offer to Purchase dated August 26, 2004.

         (a)(1)(ii) Letter of Transmittal.

         (a)(1)(iii) Notice of Guaranteed Delivery.

         (a)(1)(iv) Instruction form for shares held by brokers, dealers,
         commercial banks, trust companies and other nominees.

         (a)(1)(v) Letter to ESOP plan participants with direction form.

         (a)(1)(v) Letter to associate investment club participants with
         direction form.

         (a)(2) None.

         (a)(3) None.

         (a)(4) None.

         (a)(5)(i) Form of letter to brokers, dealers, commercial banks, trust
         companies and other nominees.

         (a)(5)(ii) Form of letter to be used by brokers, dealers, commercial
         banks, trust companies and other nominees to their clients.

          (a)(5)(iii) Press Release.

         (b)(i) First Amendment to Loan Agreement dated August 26, 2004 among
         Pre-Paid Legal Services, Inc., Bank of Oklahoma N.A., Comerica Bank and
         First United Bank & Trust.

         (b)(ii) Loan Agreement dated September 19, 2003 among Pre-Paid Legal
         Services, Inc., Bank of Oklahoma N.A., Comerica Bank and First United
         Bank & Trust. (Incorporated by reference to Exhibit 10.1 of the
         Company's Quarterly Report on Form 10-Q for the period ended September
         30, 2003)

         (b)(iii) First Amendment to Security Agreement dated August 26, 2004
         among Pre-Paid Legal Services, Inc., Bank of Oklahoma, N.A., Comerica
         Bank and First United Bank & Trust

         (b)(iv) First Amendment to Pledge Agreement dated August 26, 2004 among
         Pre-Paid Legal Services, Inc., Bank of Oklahoma, N.A., Comerica Bank
         and First United Bank & Trust

Item 13. Information Required by Schedule 13E-3.

Not applicable.

                                    SIGNATURE

After due inquiry and to the best of my knowledge and belief, I certify that the
information set forth in this statement is true, complete and correct.

Date: August 26, 2004

                          PRE-PAID LEGAL SERVICES, INC.


                          ------------------------------------------------------
                          Randy Harp, Chief Operating Officer




                                                     7
INDEX TO EXHIBITS

        Exhibit          Description

        (a)(1)(i)   Offer to Purchase dated August 26, 2004.
        (a)(1)(ii)  Letter of Transmittal.
        (a)(1)(iii) Notice of Guaranteed Delivery.
        (a)(1)(iv)  Instruction form for shares held by brokers, dealers,
                    commercial banks, trust companies and other nominees.
        (a)(1)(v)   Letter to ESOP plan participants with direction form.
        (a)(1)(vi)  Letter to associate investment club participants with
                    direction form.
        (a)(2)      None.
        (a)(3)      None.
        (a)(4)      None.
        (a)(5)(i)   Form of letter to brokers, dealers, commercial banks, trust
                    companies and other nominees.
        (a)(5)(ii)  Form of letter to be used by brokers, dealers, commercial
                    banks, trust companies and other nominees to their clients.
        (a)(5)(iii) Press Release.
        (b)(i)      First Amendment to Loan Agreement dated August 26, 2004
                    among Pre-Paid Legal Services, Inc., Bank of Oklahoma
                    N.A., Comerica Bank and First United Bank & Trust.
        (b)(ii)     Loan Agreement dated September 19, 2003 among Pre-Paid
                    Legal Services, Inc., Bank of Oklahoma N.A., Comerica
                    Bank and First United Bank & Trust. (Incorporated by
                    reference to Exhibit 10.1 of the Company's Quarterly
                    Report on Form 10-Q for the period ended September 30,
                    2003)
        (b)(iii)    First Amendment to Security Agreement dated August 26,
                    2004 among Pre-Paid Legal Services, Inc., Bank of
                    Oklahoma, N.A., Comerica Bank and First United Bank & Trust
        (b)(iv)     First Amendment to Pledge Agreement dated August 26,
                    2004 among Pre-Paid Legal Services, Inc., Bank of
                    Oklahoma, N.A., Comerica Bank and First United Bank &
                    Trust





                                EXHIBIT (a)(1)(i)

                          PRE-PAID LEGAL SERVICES, INC.
                                One Pre-Paid Way
                               Ada, Oklahoma 74820
                                 (580) 436-1234

                           Offer to Purchase for Cash
                          Up to 1,000,000 Shares of its
                     Common Stock, Par Value $0.01 Per Share
                   At a Purchase Price Not Greater Than $26.00
                         Nor Less Than $22.50 Per Share

          THE OFFER TO PURCHASE, PRORATION PERIOD AND WITHDRAWAL RIGHTS
                     EXPIRE AT 5:00 P.M., NEW YORK CITY TIME
                             ON SEPTEMBER 28, 2004,
                    UNLESS THE OFFER TO PURCHASE IS EXTENDED


We hereby invite our stockholders to tender up to 1,000,000 shares of our common
stock for purchase by us at a price not greater than $26.00 nor less than $22.50
per share, net to the seller in cash, without interest.  Our offer is being made
upon the terms and subject to the terms described in this offer to purchase.

Questions or requests for assistance or for  additional  copies of this offer to
purchase,  the letter of  transmittal  or other  tender offer  materials  may be
directed to Georgeson Shareholder  Communications,  Inc., the information agent,
at the address and telephone number set forth on the back cover of this offer to
purchase,  and copies will be furnished  promptly at our  expense.  Stockholders
also may contact their local broker,  dealer,  commercial  bank or trust company
for assistance concerning the offer.

No person has been  authorized  to make any  recommendation  on our behalf as to
whether  stockholders  should tender shares pursuant to the offer. No person has
been  authorized  to give  any  information  or to make any  representations  in
connection  with the offer other than those contained in this document or in the
related  letter of  transmittal.  If given or made, the  recommendation  and the
other  information  and  representations  must not be relied upon as having been
authorized by us.

The date of this offer to purchase is August 26, 2004






                                TABLE OF CONTENTS



Section

SUMMARY TERM SHEET

FORWARD-LOOKING STATEMENTS

1.       NUMBER OF SHARES; PRIORITY OF PURCHASES; PRORATION

2.       TENDERS BY HOLDERS OF FEWER THAN 100 SHARES

3.       PROCEDURE FOR TENDERING SHARES

4.       WITHDRAWAL RIGHTS

5.       ACCEPTANCE FOR PAYMENT OF SHARES AND PAYMENT OF
         PURCHASE PRICE

6.       CONDITIONAL TENDER OF SHARES

7.       CONDITIONS OF THE OFFER

8.       PRICE RANGE OF SHARES; DIVIDENDS

9.       PURPOSE OF THE OFFER; CERTAIN ADDITIONAL EFFECTS OF THE OFFER; PLANS
         AND PROPOSALS

10.      INFORMATION CONCERNING PRE-PAID LEGAL SERVICES

11.      SOURCE AND AMOUNT OF FUNDS

12.      INTEREST OF DIRECTORS AND OFFICERS; TRANSACTIONS AND ARRANGEMENTS
         CONCERNING SHARES


13.      LEGAL MATTERS; REGULATORY APPROVALS

14.      CERTAIN FEDERAL INCOME TAX CONSEQUENCES

15.      EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS

16.      FEES AND EXPENSES

17.      MISCELLANEOUS







                   To the Holders of Shares of Common Stock of
                          Pre-Paid Legal Services, Inc.



                               SUMMARY TERM SHEET

We are providing this summary term sheet for your convenience. It highlights the
most material  information in this document,  but you should  understand that it
does not  describe  all of the  details of the tender  offer to the same  extent
described  in this  document.  We urge you to read the entire  document  and the
related  letter of  transmittal  because  they  contain the full  details of the
tender offer. We have included references to the sections of this document where
you will find a more complete discussion.


Who is         Pre-Paid Legal Services, Inc., which we refer to as "we," "us" or
offering to    my shares?  "PPLS," is offering to purchase  shares of its common
purchase my    stock, par value $.01 per share, in a tender offer.
shares?

What will the  We are conducting the tender offerer through a procedure called a
purchase price modified "Dutch  Auction." This  proceduare  allows you to select
for the shares the price  within a price range  specified by us at which you are
be and what    willing to sell your shares. The price range for the tender offer
will be the    is $22.50 to $26.00 per share. We will select the lowest purchase
form of        price that will allow us to buy 1,000,000  shares or, if a lesser
payment?       number of shares  are  properly  tendered,  all  shares  that are
               properly  tendered  and not  properly  withdrawn.  All  shares we
               purchase  will be purchased at the same purchase  price,  even if
               you  have  selected  a lower  purchase  price,  but we  will  not
               purchase any shares above the purchase  price  selected by us. If
               you  wish  to  maximize  the  chance  that  your  shares  will be
               purchased,  you should  check the box under the  caption  "Shares
               Tendered  at Price  Determined  Under  the  Tender  Offer" in the
               letter  of  transmittal  indicating  that  you  will  accept  the
               purchase  price selected by us. You should  understand  that this
               election will have the same effect as if you selected the minimum
               price of $22.50 per share.  If your shares are  purchased  in the
               tender  offer,  you  will be paid  the  purchase  price  in cash,
               without  interest,  promptly  after the  expiration of the tender
               offer.  Under  no  circumstances  will  we  pay  interest  on the
               purchase price,  even if there is a delay in making payment.  See
               Section 1.

How many       We will purchase  1,000,000 shares validly tendered in the tender
shares will    offer,  or such fewer number of shares as are  properly  tendered
PPLS           and  not  properly   withdrawn  prior  to  the  expiration  date.
purchase?      1,000,000 shares  represents  approximately 6% of our outstanding
               common stock. We also expressly  reserve the right to purchase an
               additional  number of shares not to exceed 2% of the  outstanding
               shares,  and could  decide to purchase  more  shares,  subject to
               applicable legal requirements.  As of August 25, 2004, there were
               16,460,515  shares  issued and  outstanding.  See  Section 1. The
               tender offer is not  conditioned  on any minimum number of shares
               being tendered. See Section 7.

Why is PPLS    We  believe  that  the  tender  offer  is a  prudent  use  of our
making the     financial  resources given our business profile,  assets,  recent
tender offer?  trading  volume and current  market price,  and that investing in
               our own shares is an  attractive  use of capital and an efficient
               means to provide value to our stockholders. The tender offer also
               will  provide  increased  liquidity  to holders of shares and the
               opportunity   for  holders  to  sell  shares  without  the  usual
               transaction costs associated with open market sales. Depending on
               market  conditions and the availability of capital,  PPLS's board
               may  authorize  additional  repurchases  pursuant  to one or more
               tender  offers.   See  Section  1.  Pursuant  to  existing  Board
               authority,   management   is  also   authorized  to  purchase  an
               additional  950,000  shares in the  future,  subject  to  certain
               limitations under our amended stock term loan. See Section 11.

How will PPLS  Assuming we purchase  1,000,000 shares in the tender offer at the
pay for the    maximum specified purchase price of $26.00 per share, $26 million
shares?        will be required to purchase such shares.  We anticipate  that we
               will  obtain  all of  the  funds  necessary  to  purchase  shares
               tendered  in  the  tender  offer,  and to pay  related  fees  and
               expenses,  from existing  cash reserves and by borrowing  under a
               new amended $31.5  million  stock term loan.  The tender offer is
               not conditioned upon the receipt of financing. See Sections 7 and
               9.

Can I tender   Yes, you can elect to tender part of your shares at one price and
part of my     prices?  an  additional  amount  of  shares  at a  second  price.
shares at      However,  you cannot tender the same shares at different  prices.
different      If you  tender  some  shares at one  price  and  other  shares at
prices?        another price,  you must use a separate letter of transmittal for
               each price. See Section 3.

How long do I  You may tender your shares  until the tender offer  expires.  The
have to tender tender offer will expire on September 28, 2004, at 5:00 p.m., New
my shares?     York City time, unless we extend it. See Section 1. We may choose
               to extend the tender offer for any reason,  subject to applicable
               laws. See Section 15.

How will I be  We will issue a press release by 10:00 a.m.,  New York City time,
notified if    on the  business  day after  the  previously scheduled expiration
PPLS extends   date if we  decide to  extend the tender offer.  See section  15.
the tender
offer?

What will      Upon  the   completion   of  the  tender   offer,   non-tendering
happen if I    stockholders  will  realize  a  proportionate  increase  in their
do not tender  relative ownership interest in us and thus in our future earnings
my shares?     and assets,  subject to our right to issue  additional  shares of
               common  stock and other  equity  securities  in the  future.  See
               Section 1.

Are there any  Yes. Our  obligation to accept and pay for your  tendered  shares
obligations to depends upon a number of conditions, including:
the tender
offer?
               o    No  legal  action  shall be  pending,  or  shall  have  been
                    threatened or taken,  that might adversely affect the tender
                    offer.

               o    No commencement or escalation of a war, armed hostilities or
                    other international or national calamity, including, but not
                    limited to, an act of terrorism.

               o    No  decrease  in the price of our common  stock by more than
                    15% from the close of trading on August 25, 2004.

               o    No decline in the Dow Jones Industrial Average,  the S&P 500
                    or the New York Stock Exchange  Composite Index by more than
                    10% from the close of business on August 25, 2004.

               o    No one shall have  proposed,  announced  or made a tender or
                    exchange  offer  (other  than this  tender  offer),  merger,
                    business combination or other similar transaction  involving
                    us.

               o    No one (including  certain  groups) shall have acquired,  or
                    proposed to acquire, beneficial ownership of more than 5% of
                    the  outstanding  shares  (other  than  anyone who  publicly
                    disclosed such ownership in a filing with the Securities and
                    Exchange  Commission prior to August 25, 2004). In addition,
                    no new group shall have been formed which  beneficially owns
                    more  than 5% of the  outstanding  shares.  Finally,  no one
                    shall have filed a  Notification  and Report  Form under the
                    Hart-Scott-Rodino  Antitrust  Improvements  Act of 1976,  or
                    made a public  announcement  reflecting an intent to acquire
                    us or  any  of our  subsidiaries  or  any of our  respective
                    assets or securities.

               o    No  material  adverse  change  in  our  business   condition
                    (financial  or  otherwise),   assets,  income,   operations,
                    prospects or stock  ownership shall have occurred during the
                    tender offer. See Section 7.

How do I       To tender your shares, prior to 5:00 p.m., New York City time, on
tender my      September 28, 2004 (unless the tender offer is extended):
shares?

               o    you must  deliver your share  certificate(s)  and a properly
                    completed and duly  executed  letter of  transmittal  to the
                    depositary  at the address  appearing on the back cover page
                    of this document; or

               o    the  depositary  must receive a  confirmation  of receipt of
                    your shares by book-entry  transfer and a properly completed
                    and duly executed letter of transmittal; or



               o    you must comply with the guaranteed delivery procedure.

               If your shares are held through a broker, dealer, commercial bank
               or  other  nominee,   you  must  request  such  broker,   dealer,
               commercial  bank,  trust  company or other  nominee to effect the
               transaction for you. You may also contact the  information  agent
               for assistance. See Section 3 and the instructions to the related
               letter of transmittal.

               Shares held in the PPLS Employee Stock  Ownership and Thrift Plan
               and  Trust may be  tendered  by  giving  instructions  to Henry &
               Associates, P.C., as agent for the trustees for the plan.

               Shares held in PPLS associate  investment club may be transferred
               by giving instructions to UMB Bank, as agent for the club.

Once I have    You may withdraw any shares you have  tendered at any time before
tendered       5:00 p.m.,  New York City time, on September 28, 2004,  unless we
shares in the  extend the tender offer, in which case you may withdraw  tendered
tender offer,  shares until the tender  offer,  as so extended,  expires.  If we
can I with-    have not accepted for payment the shares you have tendered to us,
draw my        you may also  withdraw  your shares after  October 22, 2004.  See
tender?        Section 4.

How do I       You must deliver,  on a timely basis,  a written,  telegraphic or
withdraw       facsimile  notice of your  withdrawal  to the  depositary  at the
shares I       address  appearing on the back cover page of this document.  Your
previously     notice of withdrawal must specify your name, the number of shares
tendered?      to be withdrawn  and the name of the  registered  holder of these
               shares.   Some  additional   requirements   apply  if  the  share
               certificates   to  be  withdrawn   have  been  delivered  to  the
               depositary  or if  your  shares  have  been  tendered  under  the
               procedure  for  book-entry  transfer  set forth in Section 3. See
               Section 4.

Has PPlS or    Our board of directors  has approved the tender  offer.  However,
its board of   neither we nor our board of directors makes any recommendation to
directors      you as to whether  you should  tender or refrain  from  tendering
adopted a      your  shares or as to the price or prices at which you may choose
position on    to tender  your  shares.  You must make your own  decision  as to
the tender     whether to tender  your  shares  and,  if so, how many  shares to
offer?         tender  and the price or prices at which  your  shares  should be
               tendered. See Section 9.

Will PPLS's    Our directors and executive officers have advised us that they do
directors and  not plan to tender any shares in the tender  offer.  We have also
executive      been advised by Messrs.  Thomas Smith,  Thomas Tryforos and Scott
officers or    Vassulluzo,  who  collectively  own  beneficially  24.54%  of our
signicant      outstanding  common stock,  that they do not intend to tender any
shareholders   shares. See Section 12.
tender shares
in the tender
offer?

Following the  We do not believe that our purchase of shares in the tender offer
tender offer,  will cause our remaining  shares to be delisted from the New York
will PPLSI     Stock  Exchange  or cause us to be  eligible  for  deregistration
continue as    under the  Securities  Exchange Act of 1934. It is a condition of
a public       our  obligation to purchase  shares  pursuant to the tender offer
company?       that there not be any reasonable likelihood,  as determined by us
               in our  reasonable  judgment,  that these events will occur.  See
               Section 7.

What happens   We will purchase shares:
if more than
1,000,000
shares are
tendered in
the tender
offer?

               o    first,  from all  holders  of "odd  lots"  of less  than 100
                    shares who  properly  tender all of their shares at or below
                    the  purchase  price  selected  by us and  do  not  properly
                    withdraw them before the expiration date;

               o    second,  after  purchasing  the  shares  from the "odd  lot"
                    holders,  from all other  stockholders  who properly  tender
                    shares at or below the purchase  price  selected by us, on a
                    pro rata basis, subject to the conditional tender provisions
                    described in Section 6; and

               o    third, only if necessary to permit us to purchase  1,000,000
                    shares, from holders who have tendered shares subject to the
                    condition  that a specified  minimum  number of the holder's
                    shares be  purchased  if any  shares  are  purchased  in the
                    tender  offer as  described  in  Section  6 (for  which  the
                    condition was not initially satisfied) by random lot, to the
                    extent feasible.  To be eligible for purchase by random lot,
                    stockholders  whose shares are  conditionally  tendered must
                    have  tendered all of their  shares.  Therefore,  all of the
                    shares that you tender on a conditional  basis in the tender
                    offer may not be  purchased  even if they are tendered at or
                    below the purchase price.  See Section 1.

When will      We will  pay the  purchase  price,  net to you in  cash,  without
PPLS pay for   interest,   for  the  shares  we  purchase   promptly  after  the
the shares I   expiration  of the tender offer and the  acceptance of the shares
tender?        for payment.  In the event of  proration,  we do not expect to be
               able to commence  payment  for shares  until  approximately  five
               business days after the expiration date. See Section 5.

What is the    On  August  25,   2004,   the  last  trading  day  prior  to  the
recent market  commencement of the tender offer, the closing price of our shares
price of my    on the New York Stock  Exchange  was  $23.75  per share.  You are
PPLS shares?   urged to obtain current  market  quotations for the shares before
               deciding  whether and at which purchase price or purchase  prices
               to tender your shares. See Section 8.

Will I have    If you are a  registered  stockholder  and you tender your shares
to pay         directly  to the  depositary,  you will not incur  any  brokerage
brokerage      commissions. If you hold shares through a broker or bank, we urge
commissions    you  to  consult  your  broker  or  bank  to  determine   whether
if I tender    transaction costs are applicable. See Section 1 and Section 3.
my shares?

What are the   Generally,  you will be subject to U.S.  federal income  taxation
U.S. federal   when you  receive  cash from us in  exchange  for the  shares you
income tax     tender. In addition, the receipt of cash for your tendered shares
consequences   will be treated  either as (1) a sale or  exchange  eligible  for
if I tender    capital gains  treatment,  or (2) a dividend.  Non-United  States
my shares?     holders are urged to consult  their tax  advisors  regarding  the
               application  of U.S.  federal income tax  withholding  and backup
               withholding,   including   eligibility   for  a  withholding  tax
               reduction or exemption, and the refund procedure. See Section 14.

Will I have    If you instruct the  depositary in the letter of  transmittal  to
to pay any     make the payment  for the shares to the  registered  holder,  you
stock transfer will not incur any stock transfer tax. See Section 5.
tax if I tender
my shares?

Whom can I     The  information  agent  can  help  answer  your  questions.  The
talk to if     information agent is Georgeson Stockholder  Communications,  Inc.
I have         Its  contact  information  is set forth on the back cover page of
questions?     this document.

                           FORWARD-LOOKING STATEMENTS

We make  forward-looking  statements in this Offer to Purchase and in filings we
have  made  with the  Securities  and  Exchange  Commission  and may  make  such
statements in future filings. We may also make forward-looking statements in our
press   releases   or  other   public   or   stockholder   communications.   Our
forward-looking  statements are subject to risks and  uncertainties  and include
information  about our  expectations  and possible or assumed  future results of
operations.  When we use any of the words "believes," "expects,"  "anticipates,"
"estimates" or similar expressions, we are making forward-looking statements.

We claim  the  protection  of the safe  harbor  for  forward-looking  statements
contained in the Private Securities Litigation Reform Act of 1995 for all of our
forward-looking  statements.  These  forward-looking  statements  represent  our
outlook only as of the date of this  report.  While we believe that our forward-
looking statements are reasonable,  actual results could differ materially since
the statements are based on our current expectations, which are subject to risks
and  uncertainties.  Factors  that might  cause such a  difference  include  the
following:

          o    our  future  results  may be  adversely  affected  if  membership
               persistency  or  renewal  rates  are  lower  than our  historical
               experience;

          o    we may not be able to grow our  memberships  and  earnings at the
               same  rates  as it  has  historically  experienced  and  we  have
               recently   experienced  declines  in  new  membership  sales  and
               associate recruitment;

          o    we are dependent upon the continued  active  participation of our
               Chief Executive Officer;

          o    there is litigation  pending  against us that may have a material
               adverse effect on us if adversely determined;

          o    we are in a  regulated  industry  and  regulations  could have an
               adverse effect on our ability to conduct our business;

          o    the business in which we operate is competitive;

          o    we are dependent on the success of our marketing force;

          o    our stock price may be affected by the significant level of short
               sellers of our stock;

          o    we have not been  able to  increase  significantly  our  employee
               group membership sales;

          o    we are  increasing  the  amount of our  indebtedness  in order to
               finance the purchase of some of the shares in this offer;

          o    an increase in the amount or severity of litigation against us;

          o    the loss of key management personnel;

          o    the effect of terrorist attacks and potential attacks; and

          o    the effect of war in Iraq.

Other factors not currently  anticipated by management  may also  materially and
adversely affect our results of operations.  We do not undertake,  and expressly
disclaim  any  obligation,  to update or alter  our  forward-looking  statements
whether as a result of new  information,  future events or otherwise,  except as
required by  applicable  law. In  addition,  please refer to our reports on Form
10-K and Form 10-Q that are incorporated  herein by reference for information on
these and other risk factors. See Section 10.

1.       NUMBER OF SHARES; PRIORITY OF PURCHASES; PRORATION

General

Upon the terms and subject to the  conditions  described in this document and in
the letter of  transmittal,  we will  purchase up to  1,000,000  shares that are
validly  tendered  on or  prior to the  expiration  date of the  offer,  and not
withdrawn in accordance with Section 4, at a price, determined in the manner set
forth below,  not greater than $26.00 nor less than $22.50 per share.  The later
of 5:00 p.m.,  New York City time, on September 28, 2004, or the latest time and
date to which the offer is  extended  pursuant  to Section  15, is  referred  to
herein as the "expiration  date." If this offer is  oversubscribed  as described
below,  only shares  tendered at or below the purchase  price on or prior to the
expiration  date will be  eligible  for  proration.  The  proration  period also
expires on the expiration date.

Subject to the  requirements  described  in Section 15, in  accordance  with the
rules of the Securities and Exchange  Commission ("SEC"), we may, and we reserve
the right to, purchase an additional  number of shares,  not to exceed 2% of our
outstanding  common stock  (approximately  329,000 shares),  without amending or
extending this offer,  subject to limitations under our amended stock term loan.
See Section 11.

We will  determine the purchase  price taking into  consideration  the number of
shares  tendered and the prices  specified by  tendering  stockholders.  We will
select  the lowest  purchase  price that will  enable us to  purchase  1,000,000
shares,  or  such  lesser  number  of  shares  as is  validly  tendered  and not
withdrawn,  at prices not  greater  than  $26.00 nor less than $22.50 per share,
pursuant to this offer.  This offer is not  conditioned on any minimum number of
shares  being  tendered.  The  offer  is,  however,  subject  to  certain  other
conditions. See Section 7.

In accordance with instruction 5 of the letter of transmittal,  each stockholder
who wishes to tender shares must specify the price,  not greater than $26.00 nor
less than  $22.50  per  share,  at which the  stockholder  is willing to have us
purchase the shares.  Alternatively,  tendering  stockholders  may elect to have
their shares  purchased at the price  established  by the Dutch  Auction  tender
offer process, which could result in the tendering stockholder receiving a price
per share as low as $22.50 or as high as $26.00 and will have the same effect as
if the  stockholder  selected  the minimum  price of $22.50 per share.  Promptly
following the expiration date, we will determine the purchase price, not greater
than $26.00 nor less than $22.50 per share,  that we will pay for shares validly
tendered  and not  withdrawn  pursuant  to this offer,  taking into  account the
number of shares  tendered and the prices  specified by tendering  stockholders.
All  shares  purchased  pursuant  to this offer  will be  purchased  at the same
purchase  price.  All shares not  purchased  pursuant to this  offer,  including
shares  tendered  at prices  greater  than the  purchase  price and  shares  not
purchased because of proration or because they were  conditionally  tendered and
not accepted for purchase, will be returned to the tendering stockholders at our
expense promptly following the expiration date.

We expressly reserve the right, in our sole discretion, at any time or from time
to time,  to extend the period of time during  which the offer is open by giving
oral or written  notice of such  extension to the depositary and making a public
announcement  thereof. See Section 15. There can be no assurance,  however, that
we will exercise our right to extend the offer.

For purposes of the offer, a "business day" means any day other than a Saturday,
Sunday or  federal  holiday  and  consists  of the time  period  from 12:01 a.m.
through 12:00 midnight, New York City time.

Copies of this offer to purchase and the related letter of transmittal are being
mailed to record  holders of shares and will be furnished to brokers,  banks and
similar  persons  whose  names,  or the names of whose  nominees,  appear on our
stockholder list or, if applicable, who are listed as participants in a clearing
agency's  security  position  listing for  subsequent  transmittal to beneficial
owners of shares.

Priority of Purchases

Upon the terms and subject to the  conditions  of this offer,  if  1,000,000  or
fewer shares have been validly  tendered at or below the purchase  price and not
withdrawn on or prior to the expiration date, we will purchase all the shares.

Upon the  terms  and  subject  to the  conditions  of this  offer,  if more than
1,000,000  shares have been validly  tendered at or below the purchase price and
not withdrawn on or prior to the expiration date, we will purchase shares in the
following order of priority:

          o    First, all shares validly tendered at or below the purchase price
               and not  withdrawn  on or prior to the  expiration  date by or on
               behalf of any stockholder who owns of record or beneficially,  an
               aggregate of fewer than 100 shares and who validly tenders all of
               such shares (partial and conditional tenders will not qualify for
               this  preference)  and completes the box captioned  "Odd lots" on
               the letter of transmittal.

          o    Second, after purchase of all the shares properly tendered by odd
               lot  holders,   subject  to  the  conditional  tender  provisions
               described in Section 6, all other shares  validly  tendered at or
               below the  purchase  price and not  withdrawn  on or prior to the
               expiration  date  on  a  pro  rata  basis,  if  necessary,   with
               appropriate  adjustments to avoid purchases of fractional shares.
               We will purchase the same percentage of shares tendered from each
               tendering  stockholder in this second category.  We will announce
               the proration  percentage,  if it is  necessary,  after the offer
               expires.

          o    Finally,  if necessary to permit us to purchase 1,000,000 shares,
               shares  conditionally  tendered  (for which the condition was not
               initially  satisfied)  and not  properly  withdrawn  prior to the
               expiration date,  will, to the extent  feasible,  be selected for
               purchase  by  random  lot in  accordance  with  Section  6. To be
               eligible  for purchase by random lot,  stockholders  whose shares
               are  conditionally  tendered  must  have  tendered  all of  their
               shares.

Proration

If  proration  of  tendered  shares is  required,  we will  determine  the final
proration  factor  promptly  after  the  expiration  date.  Proration  for  each
stockholder  tendering shares, other than odd lot holders,  will be based on the
ratio of the number of shares tendered by the stockholder to the total number of
shares tendered by all stockholders,  other than odd lot holders, subject to the
conditional tender provisions described in Section 6. This ratio will be applied
to stockholders  tendering shares to determine the number of shares,  rounded up
to the  nearest  whole  share,  that will be  purchased  from  each  stockholder
pursuant to our offer.

Because of the potential difficulty in determining the number of shares properly
tendered and not properly  withdrawn,  including  shares  tendered by guaranteed
delivery  procedures  as  described  in  Section  3, and  because of the odd lot
procedures  described  in  Section  2  and  the  conditional  tender  procedures
described  in Section 6, we do not expect that we will be able to  announce  the
final proration percentage until seven to ten business days after the expiration
date.  The  preliminary  results of any  proration  will be  announced  by press
release promptly after the expiration date.  Stockholders may obtain preliminary
proration information from the information agent, and may be able to obtain this
information from their brokers. In the event of a proration,  we anticipate that
we will commence  payment on the tendered  shares within ten business days after
the  expiration  date.  Despite any proration,  we will commence  payment on the
tendered shares promptly after the expiration date.

As  described in Section 14, the number of shares that we will  purchase  from a
stockholder  under our offer may  affect the United  States  federal  income tax
consequences  to  that  stockholder  and,  therefore,   may  be  relevant  to  a
stockholder's   decision  whether  or  not  to  tender  shares.  The  letter  of
transmittal  affords each  stockholder the opportunity to designate the order of
priority in which shares are to be purchased in the event of proration, should a
stockholder  decide  to do so for  federal  income  tax  reasons.  In  addition,
stockholders  may choose to submit a  "conditional  tender" under the procedures
described in Section 6 in order to structure their tender for federal income tax
reasons.

2.       TENDERS BY HOLDERS OF FEWER THAN 100 SHARES

Except to the extent that our  purchase  would  result in the  delisting  of our
common stock on the New York Stock Exchange,  all shares validly  tendered at or
below the purchase price and not withdrawn on or prior to the expiration date by
or on behalf of any stockholder who owned of record or beneficially an aggregate
of fewer than 100 shares,  will be accepted for purchase  before  proration,  if
any, of other tendered shares.  Partial or conditional  tenders will not qualify
for this preference,  and it is not available to record or beneficial holders of
100 or more shares,  even if the holders have separate  stock  certificates  for
fewer than 100 shares.  By accepting this offer, a stockholder  owning of record
or  beneficially  fewer than 100  shares  will  avoid the  payment of  brokerage
commissions and the applicable odd lot discount payable in a sale of such shares
in a transaction effected on a securities exchange.

As of August 25, 2004, there were approximately  17,500 holders of record of our
common stock.  Approximately  8,600 of these holders of record held individually
fewer than 100 shares and held in the aggregate  approximately  245,000  shares.
Because of the large number of shares held in the names of brokers and nominees,
we are  unable to  estimate  the number of  beneficial  owners of fewer than 100
shares or the aggregate  number of shares they own. Any  stockholder  wishing to
tender all of his or her shares pursuant to this section should complete the box
captioned "Odd Lots" on the letter of transmittal.

3.       PROCEDURE FOR TENDERING SHARES

To tender shares pursuant to our offer, either (1) or (2) below must occur:

(1) A properly  completed and duly executed  letter of  transmittal or facsimile
thereof, together with any required signature guarantees and any other documents
required by the letter of transmittal, must be received by the depositary at its
address  set forth on the back  cover of this offer to  purchase  and either (i)
certificates for the shares to be tendered must be received by the depositary at
such address or (ii) the shares must be delivered pursuant to the procedures for
book-entry transfer described below, and a confirmation of the delivery received
by the  depositary  including an agent's  message  (described  under "Book Entry
Delivery" below), in each case on or prior to the expiration date.

(2) You must comply with the guaranteed delivery procedure set forth below.

In accordance with instruction 5 of the letter of transmittal,  if you desire to
tender shares, you must specify the price or prices, not greater than $26.00 nor
less than $22.50 per share, at which you are willing to sell your shares. Prices
may be specified in increments of $0.50. Alternatively,  if you desire to tender
your shares,  you can choose not to specify a price and,  instead,  specify that
you will sell your  shares  at the  purchase  price  selected  by us for  shares
properly  tendered in our offer. By following the  instructions to the letter of
transmittal,  you can specify one minimum price for a specified  portion of your
shares and a different  minimum price for other specified  shares.  You also can
condition  your tender of shares on the  purchase of all or a specified  minimum
number of your shares being purchased.

If you wish to maximize  the chance that your  shares will be  purchased  at the
purchase price we select,  you should check the box in the section of the letter
of transmittal  next to "Shares  Tendered At Price Determined By Dutch Auction."
This means that you will accept the purchase price we select in accordance  with
the terms of our offer.  Note that this election will have the same effect as if
you  selected  the  minimum  price of $22.50 per share and could  contribute  to
lowering the purchase price we ultimately select.

If you wish to tender shares at more than one price you must  complete  separate
letters of transmittal  for each price at which shares are being  tendered.  The
same shares  cannot be tendered at more than one price.  If you submit  multiple
letters  of  transmittal,  you may  withdraw  all or any  portion  of the shares
transferred  pursuant to a single notice of withdrawal  made in accordance  with
Section 4 of this document.

In cases where shares are  tendered by a  registered  holder of our common stock
who has completed either the box entitled "Special Payment  Instructions" or the
box entitled "Special Delivery  Instructions" in the letter of transmittal,  all
signatures  on the letters of  transmittal  must be  guaranteed  by an "eligible
institution." An "eligible institution" is a bank, broker, dealer, credit union,
savings  association  or other  entity that is a member in good  standing of the
Securities Transfer Agents Medallion Program or a bank, broker,  dealer,  credit
union,  savings  association  or other  entity  that is an  "eligible  guarantor
institution,"  as that term is defined  in Rule  17Ad-15  promulgated  under the
Securities  Exchange Act of 1934 referred to herein as the "Exchange  Act,".  If
the certificates are registered in the name of a person other than the signer of
the letter of transmittal,  or if certificates for unpurchased  shares are to be
issued to a person other than the registered holder(s), the certificates must be
endorsed or  accompanied  by  appropriate  stock  powers,  in either case signed
exactly  as the name or names of the  registered  owner or owners  appear on the
certificates,  with  the  signature(s)  on  the  certificates  or  stock  powers
guaranteed by an eligible institution.

A tender of shares  pursuant to the  procedures  described  in this section will
constitute a binding agreement between the tendering stockholder and us upon the
terms and subject to the conditions of our offer.

The method of delivering all documents,  including  certificates for shares, the
letter of transmittal and any other required documents,  is at your election and
risk. If delivery is by mail,  registered  mail with return  receipt  requested,
properly insured, is recommended.

All deliveries in connection  with our offer,  including a letter of transmittal
and certificates for shares, must be made to the depositary and not to us or the
book-entry  transfer facility.  Any documents  delivered to us or the book-entry
transfer facility will not be forwarded to the depositary and therefore will not
be deemed to be  properly  tendered.  In all cases,  sufficient  time  should be
allowed to ensure timely delivery.

Book-Entry Delivery

The  depositary  will  establish  an account  with  respect to the shares at the
book-entry  transfer facility for purposes of our offer within two business days
after the date of this document. Any financial institution that is a participant
in the system of the book-entry  transfer facility may make book-entry  delivery
of shares by causing the  book-entry  transfer  facility to transfer  the shares
into the depositary's account in accordance with the depositary's  procedure for
the transfer.  Even though delivery of shares may be effected through book-entry
transfer into the  depositary's  account at the  book-entry  transfer  facility,
either (1) or (2) below must occur for a valid tender:

(1) A properly  completed and duly executed  letter of transmittal or a manually
signed copy thereof, or an agent's message, as defined below,  together with any
required  signature  guarantees and any other required  documents,  must, in any
case, be  transmitted to and received by the depositary at its address set forth
on the back cover of this offer on or prior to the expiration date.

(2) You must comply with the guaranteed delivery procedures set forth below.

Delivery of the letter of transmittal (or other required  documentation)  to the
book-entry transfer facility does not constitute delivery to the depositary.

The  term  "agent's  message"  means a  message  transmitted  by the  book-entry
transfer  facility to, and received by, the  depositary  and forming a part of a
book-entry confirmation,  which states that the book-entry transfer facility has
received  an express  acknowledgement  from the  participant  in the  book-entry
transfer  facility  tendering the shares,  that the participant has received and
agrees to be bound by the terms of the  letter  of  transmittal  and that we may
enforce the agreement against the participant.

Guaranteed Delivery

If you  want to  tender  your  shares  pursuant  to our  offer  but  your  share
certificates  are  not  immediately  available,  the  procedure  for  book-entry
transfer  cannot be completed on a timely basis,  or if time will not permit all
required documents to reach the depositary prior to the expiration date, you can
still tender your shares if all the following conditions are met:

          o    the tender is made by or through an eligible institution;

          o    the  depositary  receives  by hand,  mail,  overnight  courier or
               facsimile transmission,  prior to the expiration date, a properly
               completed and duly executed notice of guaranteed  delivery in the
               form  we  have  provided  with  this  document,  with  signatures
               guaranteed by an eligible institution;

          o    the depositary receives, within three trading days after the date
               of its receipt of the notice of guaranteed delivery:

               o    the certificates for all tendered shares, or confirmation of
                    receipt  of  the  shares   pursuant  to  the  procedure  for
                    book-entry transfer as described above;

               o    a properly completed and duly executed letter of transmittal
                    or facsimile  of it, or an agent's  message in the case of a
                    book-entry transfer, and

               o    any other documents required by the letter of transmittal.

In any  event,  the  exchange  of the  purchase  price for shares  tendered  and
accepted  for  purchase  pursuant  to our offer will be made only  after  timely
receipt by the depositary of certificates  for the shares,  properly  completed,
duly executed letter(s) of transmittal and any other required documents.

Determination of Validity; Rejection of Shares; Waiver of Defects; No Obligation
  to Give Notice of Defects

All questions as to the validity,  form, eligibility (including time of receipt)
and  acceptance  of any tender of shares  will be  determined  by us in our sole
discretion,  and our  determination  will be final and  binding.  We reserve the
absolute right to reject any or all tenders determined by us not to be in proper
form or the  acceptance or purchase of which may, in the opinion of our counsel,
be unlawful. We also reserve the absolute right to waive prior to the expiration
date any  condition  (other than the  nonwaivable  conditions)  or any defect or
irregularity in the tender of any shares.  No tender of shares will be deemed to
have been validly made until all defects and  irregularities  have been cured or
waived.  Our  interpretation of the terms and conditions of our offer (including
this document,  the letter of transmittal and its  instructions  and other offer
materials)  will be final and binding.  Neither we, the depositary nor any other
person  will  be  under  any  duty  to  give  notification  of  any  defects  or
irregularities  in the  tender of any  shares or will  incur any  liability  for
failure to give any such notification.

Procedure for Shares Held By Brokers, Dealers, Commercial Banks, Trust Companies
  and Other Nominees

If your shares are registered in the name of a broker, dealer,  commercial bank,
trust company or other nominee, you must contact the broker, dealer,  commercial
bank,  trust  company or other  nominee if you wish to tender your  shares.  You
should  contact your broker,  dealer,  commercial  bank,  trust company or other
nominee in sufficient  time to permit  notification  of your desire to tender to
reach the depositary by the expiration date of our offer.

Procedure  For Shares Held in Pre-Paid  Legal  Service,  Inc.'s  Employee  Stock
  Ownership and Thrift Plan

Participants  in the Pre-Paid Legal Service,  Inc.  Employee Stock Ownership and
Thrift Plan and Trust ("ESOP Plan") must instruct the Trustees not to tender any
shares or to  tender  some or all of the  shares  allocated  to a  participant's
account.  Participants  must follow the  instructions in the letter to ESOP Plan
participants furnished separately and returning it to the agent appointed by the
trustees in  accordance  with those  instructions.  All  documents  furnished to
stockholders  generally in connection with the offer will be made available to a
participant whose plan account is credited with shares. Participants in the plan
cannot use the letter of  transmittal  to direct the tender of shares,  but must
use the  separate  direction  form sent to them.  Even if you hold any shares in
addition  to shares  you hold  under  the ESOP  Plan and you wish to tender  the
additional  shares as well, you should follow the procedures set forth elsewhere
in this  document  and the related  letter of  transmittal  with  respect to the
tender of the additional  shares. If you do not wish to tender shares,  you must
also deliver an instruction to the agent for the trustees.

Our ESOP Plan is prohibited  from selling  shares to us for a price that is less
than the  prevailing  market price.  Accordingly,  if a participant  in the plan
elects to tender  shares at a price that is lower than the closing  price of our
common stock on the New York Stock Exchange on the  expiration  date, the tender
price elected by the  participant  will be deemed to have been  increased to the
closest tender price that is not less than the closing price of our common stock
on the New York Stock Exchange on the expiration date. This could result in such
shares not being purchased in the offer.

Delivery  of a  letter  of  transmittal  by an ESOP  Plan  participant  does not
constitute  proper  tender of his or her shares in the ESOP Plan.  Proper tender
can only be made by the  Trustees,  which is the record owner of the shares held
in the ESOP  Plan.  We have been  advised  that if the agent has not  received a
participant's  direction form at least two business days prior to the expiration
date, any shares held on behalf of the non-electing participant will be tendered
in the same proportion as shares tendered by all disinterested  participants and
the  number  of  shares  not   tendered  by  all   disinterested   participants.
Disinterested participants are participants other than executive officers. As an
example,  if a  total  of  10,000  shares  are  tendered  by  all  disinterested
participants and a total of 20,000 shares are not tendered by all  disinterested
participants,   one-third   (10,000/30,000)   of  the  shares   allocated  to  a
participant's account who does not give directions will be tendered.

The ESOP Plan trustees  have  designated  Henry &  Associates,  P.C. as agent to
receive   directions  from  participants  who  will  hold  these  directions  in
confidence until completion of the offer.

The  proceeds  received  by the ESOP  Plan  from any  tender  of  shares  from a
participant's  plan account will be  reinvested  in the money market fund in the
ESOP Plan.  We will be amending the ESOP Plan to permit  participants  to direct
investment of any money market balance in their accounts, including the proceeds
of the tender offer,  into a selection of diversified  mutual funds.  Additional
information  about  these  plans  is  contained  in a  separate  letter  to plan
participants.

Procedures For Shares Held in Pre-Paid Legal Services Inc. Associate  Investment
  Club

Participants  in the Pre-Paid  Legal Service,  Inc.  Associate  Investment  Club
("Club") may instruct the Club to tender some or all of the shares  allocated to
a  participant's  account by following  the  instructions  in the letter to Club
participants  furnished  separately  and returning it to UMB Bank which has been
appointed  to tabulate  participant  instructions.  All  documents  furnished to
stockholders  generally in connection with the offer will be made available to a
participant  whose Club accounts are credited with shares.  Participants  in the
Club cannot use the letter of  transmittal  to direct the tender of shares,  but
must use the  separate  direction  form sent to them.  If you hold any shares in
addition to shares you hold under the Club and you wish to tender the additional
shares as well,  you should follow the  procedures  set forth  elsewhere in this
document and the related letter of transmittal with respect to the tender of the
additional shares.

Delivery of a letter of  transmittal by a Club  participant  does not constitute
proper  tender of his or her shares in the Club.  Proper tender can only be made
by the Club,  which is the record owner of the shares held in the Club.  We have
been advised that if UMB Bank has not received a  participant's  instructions at
least two business days prior to the  expiration  date, the Club will not tender
any shares held on behalf of the participant in the Club.

The proceeds received by the Club from any tender of shares from a participant's
Club account will be distributed to the participant.


Your Representations and Warranties; Our Acceptance Constitutes an Agreement

It is a violation of Rule 14e-4 promulgated under the Securities Exchange Act of
1934 for a person,  directly or  indirectly,  to tender shares for that person's
own  account  unless,  at the  time of  tender  and at the end of the  proration
period, the person so tendering:

          o    has a "net long position"  equal to or greater than the amount of
               (i) shares  tendered or (ii) securities  immediately  convertible
               into, or exchangeable or exercisable for, the subject securities;
               and

          o    will  deliver or cause to be delivered  the shares in  accordance
               with the terms of the tender offer.

Rule 14e-4 provides a similar restriction  applicable to the tender or guarantee
of a tender on behalf of another person.

A tender of shares under any of the procedures  described  above will constitute
your  acceptance  of the  terms and  conditions  of our  offer,  as well as your
representation and warranty to us that:

          o    you  have a "net  long  position"  in the  shares  or  equivalent
               securities  at least  equal to the  shares  tendered  within  the
               meaning of Rule 14e-; and

          o    the tender of shares complies with Rule 14e-4.

Our acceptance for payment of shares  tendered under our offer will constitute a
binding  agreement between you and us upon the terms and conditions of our offer
described in this and related documents.

Federal Backup Withholding Tax

Under the United States federal backup  withholding tax rules,  28% of the gross
proceeds  payable to a  stockholder  or other payee in the tender  offer must be
withheld and remitted to the United States  Treasury,  unless the stockholder or
other payee  provides such person's  taxpayer  identification  number  (employer
identification number or social security number) to the depositary and certifies
under penalties of perjury that this number is correct or otherwise  establishes
an  exemption.  If the  depositary  is not  provided  with the correct  taxpayer
identification number or another adequate basis for exemption, the holder may be
subject to certain penalties imposed by the Internal Revenue Service. Therefore,
each tendering  stockholder  should  complete and sign the  substitute  Form W-9
included  as  part  of the  letter  of  transmittal  in  order  to  provide  the
information and certification necessary to avoid backup withholding,  unless the
stockholder otherwise establishes to the satisfaction of the depositary that the
stockholder is not subject to backup withholding.

Certain  stockholders  (including,  among others,  all  corporations and certain
foreign  stockholders  in addition to foreign  corporations)  are not subject to
these backup withholding rules. In order for a foreign stockholder to qualify as
an exempt  recipient,  that  stockholder must submit an Internal Revenue Service
Form W-8 or a Substitute Form W-8, signed under penalties of perjury,  attesting
to that  stockholder's  exempt status.  The applicable form can be obtained from
the depositary. See Instruction 10 of the letter of transmittal.

To prevent  federal  backup  withholding  tax equal to 28% of the gross payments
made to stockholders for shares purchased under our offer,  each stockholder who
does not otherwise  establish an exemption from the withholding must provide the
depositary with the  stockholder's  correct taxpayer  identification  number and
provide other  information by completing  the substitute  Form W-9 included with
the letter of transmittal.

Each  stockholder is urged to consult with his or her own tax advisor  regarding
his, her or its  qualifications  for exemption from backup  withholding  and the
procedure for obtaining any applicable exemption.

For a discussion of United States federal income tax  consequences  to tendering
stockholders, see Section 14.

Lost or Destroyed Certificates

If your  certificate(s)  for part or all of your shares have been lost,  stolen,
misplaced or destroyed,  indicate that fact on the letter of transmittal,  which
should  then be  delivered  to the  depositary  after being  otherwise  properly
completed  and  duly  executed.  In such  event,  the  depositary  will  forward
additional  documentation  necessary  to be  completed  in order to  effectively
replace the lost or destroyed  certificate(s).  See instruction 13 of the letter
of transmittal.

4.       WITHDRAWAL RIGHTS

Tenders of shares made  pursuant to the offer may be withdrawn at any time prior
to the expiration date.  Thereafter,  tenders are irrevocable,  except that they
may be  withdrawn  after 12:00  midnight,  New York City time,  October 22, 2004
unless  previously  accepted  for  payment  by us as  provided  in this offer to
purchase.  If we extend the period of time during  which the offer is open,  are
delayed in purchasing  shares or are unable to purchase  shares  pursuant to the
offer for any reason, then, without prejudice to our rights under the offer, the
depositary may, on our behalf,  retain all shares  tendered,  and the shares may
not be withdrawn except as otherwise provided in this Section 4, subject to Rule
13e-4(f)(5)  under the Securities  Exchange Act of 1934, which provides that the
issuer  making the tender  offer shall either pay the  consideration  offered or
return the tendered  securities  promptly after the termination or withdrawal of
the tender offer.

Withdrawal of Shares Held in Physical Form. For a withdrawal to be effective,  a
holder of shares held in physical  form must provide a written,  telegraphic  or
facsimile transmission notice of withdrawal to the depositary at its address set
forth on the back cover page of this offer  before the  expiration  date,  which
notice must contain:  (1) the name of the person who tendered the shares;  (2) a
description of the shares to be withdrawn;  (3) the certificate numbers shown on
the  particular  certificates  evidencing  the shares;  (4) the signature of the
stockholder  executed in the same manner as the original signature on the letter
of transmittal,  including any signature  guarantee,  if such original signature
was  guaranteed;  and (5) if the  shares  are  held by a new  beneficial  owner,
evidence satisfactory to us that the person withdrawing the tender has succeeded
to the beneficial ownership of the shares. A purported notice of withdrawal that
lacks any of the required  information will not be an effective  withdrawal of a
tender previously made.

Withdrawal  of  Shares  Held  with  the  Book-Entry  Transfer  Facility.  For  a
withdrawal to be effective, a holder of shares held with the book-entry transfer
facility  must:  (1) call his or her broker and  instruct the broker to withdraw
the tender of shares by  debiting  the  depositary's  account at the  book-entry
transfer facility for all shares to be withdrawn; and (2) instruct the broker to
provide a written, telegraphic or facsimile transmission notice of withdrawal to
the depositary on or before the expiration  date. The notice of withdrawal shall
contain (a) the name of the person who tendered the shares; (b) a description of
the shares to be withdrawn;  and (c) if the shares are held by a new  beneficial
owner,  evidence  satisfactory to us that the person  withdrawing the tender has
succeeded  to the  beneficial  ownership  of the shares.  A purported  notice of
withdrawal that lacks any of the required  information  will not be an effective
withdrawal of a tender previously made.

Any permitted  withdrawals  of tenders of shares may not be  rescinded,  and any
shares so withdrawn will thereafter be deemed not validly  tendered for purposes
of the offer;  provided,  however,  that withdrawn  shares may be re-tendered by
following the procedures for tendering prior to the expiration date.

All questions as to the form and  validity,  including  time of receipt,  of any
notice of withdrawal  will be determined  by us, in our sole  discretion,  which
determination  shall be final  and  binding  on all  parties.  Neither  we,  the
information  agent,  the depositary nor any other person is or will be under any
duty to give  notification  of any  defect  or  irregularity  in any  notice  of
withdrawal or incur any liability for failure to give any such notification.

5.       ACCEPTANCE FOR PAYMENT OF SHARES AND PAYMENT OF PURCHASE PRICE

Upon the terms and subject to the conditions of the offer and promptly after the
expiration date, we will determine the purchase price, taking into consideration
the  number  of  shares   tendered   and  the  prices   specified  by  tendering
stockholders,  announce the purchase  price and,  subject to the  proration  and
conditional  tender  provisions  of the offer,  accept for  payment  and pay the
purchase  price for shares  validly  tendered and not  withdrawn at or below the
purchase price. Thereafter,  payment for all shares validly tendered on or prior
to the  expiration  date and accepted for payment  pursuant to the offer will be
made promptly by the depositary by check.  Payment for shares accepted  pursuant
to the offer will be made only after timely  receipt by the  depositary  of: (1)
certificates  for such shares or confirmation  of a book-entry  transfer of such
shares into the depositary's account at the book-entry transfer facility;  (2) a
properly  completed and duly executed letter of transmittal or a manually signed
copy  thereof,  with any  required  signature  guarantees,  or, in the case of a
book-entry delivery, an agent's message; and (3) any other required documents.

For purposes of the offer, we shall be deemed to have accepted for payment,  and
thereby purchased, subject to proration and conditional tenders, shares that are
validly  tendered  and not  withdrawn  as, if and when we give  oral or  written
notice to the  depositary of our  acceptance  for payment of the shares.  In the
event of proration,  we will  determine  the proration  factor and pay for those
tendered  shares  accepted  for  payment  promptly  after the  expiration  date.
However,  we do not expect to be able to announce the final  results of any such
proration  until  approximately  seven to ten business days after the expiration
date.  We will pay for shares  that we have  purchased  pursuant to the offer by
depositing the aggregate  purchase  price  therefore  with the  depositary.  The
depositary  will act as agent for  tendering  stockholders  for the  purpose  of
receiving  payment from us and transmitting  payment to tendering  stockholders.
Under no circumstances  will interest be paid on amounts to be paid to tendering
stockholders, regardless of any delay in making such payment.

Certificates  for all shares not  purchased  pursuant  to this offer to purchase
will be returned, or, in the case of shares tendered by book-entry transfer, the
shares will be credited to an account  maintained  with the book-entry  transfer
facility by the  participant  therein  who so  delivered  the  shares,  promptly
following the expiration date without expense to the tendering stockholder.

Payment for shares may be delayed in the event of difficulty in determining  the
number of shares properly  tendered or if proration is required.  See Section 1.
In addition, if certain events occur, we may not be obligated to purchase shares
pursuant to the offer. See Section 7.

We will pay or cause to be paid any stock  transfer  taxes  with  respect to the
sale and  transfer of any shares to us or our order  pursuant to the offer.  If,
however,  payment  of the  purchase  price is to be made to, or a portion of the
shares  delivered,  whether  in  certificated  form  or by  book-entry,  but not
tendered or not  purchased are to be registered in the name of, any person other
than the registered  holder, or if tendered shares are registered in the name of
any person other than the person signing the letter of  transmittal,  unless the
person is signing in a representative or fiduciary  capacity,  the amount of any
stock  transfer  taxes,  whether  imposed on the registered  holder,  such other
person or  otherwise,  payable on account of the  transfer to the person will be
deducted from the purchase price unless satisfactory  evidence of the payment of
such taxes,  or exemption  therefrom,  is  submitted.  See  instruction 7 to the
letter of transmittal.

Any tendering  stockholder  or other payee who fails to complete  fully and sign
the substitute Form W-9 included in the letter of transmittal or, in the case of
a foreign individual,  a Form W-8, may be subject to required federal income tax
withholding of 28% of the gross proceeds paid to such stockholder or other payee
pursuant to the offer. See Section 3.

6.       CONDITIONAL TENDER OF SHARES

Under certain  circumstances  and subject to the exceptions set forth in Section
1, we may  prorate  the number of shares  purchased  pursuant  to the offer.  As
discussed in Section 14, the number of shares to be purchased  from a particular
stockholder  might affect the tax treatment of the purchase for the  stockholder
and the stockholder's  decision whether to tender.  Each stockholder is urged to
consult with his or her own tax advisor.  Accordingly,  a stockholder may tender
shares  subject  to  the  condition  that  a  specified  minimum  number  of the
stockholder's  shares  tendered  pursuant  to a letter  of  transmittal  must be
purchased if any shares so tendered are purchased.  Any stockholder  desiring to
make a  conditional  tender must so indicate in the box  captioned  "Conditional
Tender" in the letter of transmittal.

Any tendering  stockholders  wishing to make a conditional tender must calculate
and appropriately  indicate the minimum number of shares to be tendered.  If the
effect of accepting tenders on a pro rata basis would be to reduce the number of
shares to be purchased from any  stockholder,  tendered  pursuant to a letter of
transmittal,   below  the  minimum   number  so   specified,   the  tender  will
automatically  be  regarded  as  withdrawn,  except  as  provided  in  the  next
paragraph, and all shares tendered by the stockholder pursuant to the applicable
letter of transmittal will be returned promptly thereafter.

If conditional  tenders that would  otherwise be so regarded as withdrawn  would
cause the total number of shares to be purchased to fall below 1,000,000,  then,
to the extent  feasible,  we will select enough  conditional  tenders that would
otherwise have been so withdrawn to permit us to purchase  1,000,000  shares. In
selecting among these conditional  tenders, we will select by lot and will limit
our  purchase in each case to the  minimum  number of shares  designated  by the
stockholder in the applicable letter of transmittal as a condition to his or her
tender.

7.       CONDITIONS OF THE OFFER

Notwithstanding  any other  provisions of our offer,  we will not be required to
accept for purchase or purchase any shares,  may  postpone  the  acceptance  for
purchase of or the  purchase of shares  tendered,  and may cancel,  terminate or
amend our offer as provided  herein if any of the following  conditions  are not
satisfied or waived on or before the expiration date.

Avoidance of Rule 13e-3 Transaction Condition

We may amend or  terminate  the offer,  and will not be  required  to accept for
purchase any shares  tendered  if, in our good faith  reasonable  judgment,  any
purchase of shares under the offer could result in the offer being  considered a
"going private  transaction" under Rule 13e-3 of the Securities  Exchange Act of
1934, that is,

          o    if our purchase of shares  pursuant to this offer would result in
               our common  stock being held of record by fewer than 300 persons;
               or

          o    if our purchase of shares  pursuant to this offer would result in
               our common  stock no longer being  authorized  for trading on the
               New York Stock Exchange System.

As of August 25, 2004,  there were  approximately  17,500 record  holders of our
shares.

This condition is a nonwaivable condition to our offer.

No Legal Prohibition Condition

We will not be  obligated  to close  the  offer if a  preliminary  or  permanent
injunction,  decree or order has been entered or threatened by any  governmental
authority, or another legal restraint or prohibition is in effect, that either:

          o    enjoins, restrains or prohibits our offer;

          o    or, in our reasonable  judgment,  could  materially and adversely
               affect our business,  financial condition,  income, operations or
               prospects,   or  otherwise  materially  impair  in  any  way  the
               contemplated  future  conduct of our  business  or our ability to
               purchase  1,000,000  shares  of our  common  stock in the  tender
               offer.

As of the date of this document, no such injunction, decree, order, restraint or
prohibition  exists,  nor to  our  knowledge  has  any  of  the  foregoing  been
threatened. However, we can give no assurance that an injunction, decree, order,
restraint or prohibition will not exist in the future.

We  reserve  the  right  (but  are not  obligated),  subject  to the  rules  and
regulations  of the SEC,  to waive this  condition,  in whole or in part,  on or
before the expiration date.

Material Adverse Change Condition

We will not be obligated to close our offer if, after the date of this document,
any of the following has occurred:

          o    the  declaration  of any banking  moratorium or any suspension of
               payments in respect of banks in the United States (whether or not
               mandatory);

          o    any general  suspension  of trading in, or  limitation  on prices
               for,  securities on any U.S. national  securities  exchange or in
               the over-the-counter market;

          o    any limitation  (whether or not  mandatory) by any  governmental,
               regulatory or administrative agency or authority on, or any event
               which, in our reasonable  judgment,  might materially  affect the
               extension of credit by banks or other lending institutions in the
               United States;

          o    a  decrease  in the  market  price of our shares of more than 15%
               measured  from the close of trading on August 25, 2004,  the last
               trading day preceding the date this offer was announced,  and the
               close of trading on the last trading day prior to  expiration  of
               this offer;

          o    any  change  in  the  general  political,   market,  economic  or
               financial  conditions  in the United  States or abroad that could
               have, in our reasonable  judgment,  a material  adverse effect on
               our  business,   financial  condition,   income,   operations  or
               prospects, or on the trading in our shares;

          o    in the case that any of the foregoing  conditions  existed at the
               time of the announcement of our offer, a material acceleration or
               worsening of those conditions;

          o    any decline in the Dow Jones Industrial  Average,  the Standard &
               Poor's  Index of 500  Industrial  Companies or the New York Stock
               Exchange  Composite  Index by an amount in excess of 10% measured
               from the close of business on August 25, 2004; or

          o    any  change  or  event  has  occurred  or is  threatened  in  our
               subsidiaries'   business  condition   (financial  or  otherwise),
               assets, income,  operations or prospects or stock ownership that,
               in our reasonable judgment,  is or is reasonably likely to have a
               material adverse effect on us or our subsidiaries.

No Competing Offer Condition

We will not be obligated to close our offer if, after the date of this document,
a tender or exchange offer with respect to some or all of the shares (other than
our offer), or merger,  acquisition  proposal or other business  combination for
Pre-Paid Legal  Services has been proposed,  announced or made by another person
or we have learned that:

          o    any person or "group" (within the meaning of Section  13(d)(3) of
               the Securities  Exchange Act of 1934) has acquired or proposes to
               acquire  beneficial  ownership of more than 5% of the outstanding
               shares,  whether through the acquisition of stock,  the formation
               of a group,  the grant of any option or right or otherwise (other
               than as  disclosed  in a  Schedule  13D or 13G  (or an  amendment
               thereto) on file with the SEC on the date of this document);

          o    any such  person  or  group  that on or prior to the date of this
               document had filed such a Schedule  with the SEC  thereafter  has
               acquired  or  has  proposed  to  acquire,   whether  through  the
               acquisition of stock,  the formation of a group, the grant of any
               option or right or otherwise,  beneficial ownership of additional
               shares representing 2.0% or more of the outstanding shares; or

          o    any  person or group has filed a  Notification  and  Report  Form
               under the Hart-Scott-Rodino  Antitrust  Improvements Act of 1976,
               as  amended,  reflecting  an intent  to  acquire  Pre-Paid  Legal
               Services or any of the shares, or has made a public  announcement
               reflecting an intent to acquire Pre-Paid Legal Services or any of
               its subsidiaries or any of their assets.

We are not aware of any such event having occurred. In any event, we reserve the
right (but are not obligated),  subject to the rules and regulations of the SEC,
to waive this condition, in whole or in part, prior to the expiration date.

Effect of Failing to Satisfy Conditions

If any of the conditions have not been satisfied or, if waivable,  not waived by
the expiration  date, we may elect either to:

          o    extend  the  expiration  date and our offer and retain all shares
               tendered  until the  expiration  date of the  offer as  extended,
               subject to the right of a tendering  stockholder  to withdraw his
               or her shares;

          o    waive the conditions  (other than the condition  regarding  going
               private  and the  condition  regarding  no  legal  prohibitions),
               extend our offer for a period of ten  business  days if our offer
               is scheduled to expire prior thereto if such waiver constitutes a
               material  change  in  our  offer,  and  thereafter  purchase  all
               properly tendered shares; or

          o    terminate  our offer and  purchase  none of the shares and return
               all tendered shares.

We will not accept for purchase any shares pursuant to our offer until such time
as the conditions have been satisfied or waived.

8.       PRICE RANGE OF SHARES; DIVIDENDS

Our common stock is listed on the New York Stock  Exchange under the symbol PPD.
The  following  table sets forth the high and low sales  prices,  for our common
stock as reported on the New York Stock Exchange.




                                                                       HIGH               LOW
                                                                    ------------      ------------
                                                                           
         2002
            First Quarter....................................   $      31.75      $      18.76
            Second Quarter...................................          30.45             18.50
            Third Quarter....................................          24.29             16.68
            Fourth Quarter...................................          30.49             17.04
         2003
            First Quarter....................................   $      26.80      $      15.80
            Second Quarter...................................          27.40             17.22
            Third Quarter....................................          25.21             20.60
            Fourth Quarter...................................          28.30             23.24
         2004
            First Quarter....................................   $      26.63      $      21.60
            Second Quarter...................................          25.50             22.27
            Third Quarter through August 25..................          23.99             22.25



On August  25,  2004,  the  closing  price of the  shares on the New York  Stock
Exchange was $23.75 per share.  Stockholders  are urged to obtain current market
quotations for the shares.

We have not historically paid any dividends on our common stock. We are actively
considering  the  payment of a cash  dividend if our Board  determines  doing so
would be in the best  interests of  shareholders.  Any decisions by our Board of
Directors to pay cash  dividends  in the future,  in lieu of, or in addition to,
further stock repurchases or share related initiatives, depend upon, among other
factors, our earnings,  financial condition, capital requirements and the market
price of our common stock.

9.       PURPOSE OF THE OFFER; CERTAIN ADDITIONAL EFFECTS OF THE OFFER; PLANS
         AND PROPOSALS

We are making  this offer  because  our board of  directors  has  evaluated  our
operations,  strategy and  expectations  for the future and continues to believe
that  purchasing our own shares is an attractive use of capital and an efficient
means  to  provide  value  to  shareholders.  The  tender  offer  permits  us to
accelerate these purchases and we believe that the tender offer is a prudent use
of our financial  resources given our business profile,  assets,  recent trading
volume and current market price. We believe that our current financial resources
and debt capacity exceed the financial requirements of our business.

We believe  that the  modified  "Dutch  Auction"  tender  offer set forth herein
represents  a mechanism  to provide all  shareholders  with the  opportunity  to
tender  all or a  portion  of their  shares  and,  thereby,  receive a return of
capital  if they so elect.  This  format of  repurchase  provides  a method  for
shareholders not participating to increase their relative percentage interest in
PPLS and its future  operations  at no  additional  cost.  The tender offer also
provides  shareholders  (particularly  those  who,  because of the size of their
stockholdings,  might  not be  able  to  sell  their  shares  without  potential
disruption  to the share price) with an  opportunity  to obtain  liquidity  with
respect to their shares, without potential disruption to the share price and the
usual transaction costs associated with market sales.

We have  previously  repurchased  shares  as a means of  increasing  shareholder
value. Pursuant to the repurchase program originally announced on April 6, 1999,
we have  repurchased  thorough August 10, 2004, 8.1 million shares of our common
stock for total  consideration of $183.8 million,  or an average price of $22.83
per share and have reduced the number of shares outstanding by approximately 30%
from 23.7  million at March 31, 1999 to  approximately  16.5 million  today.  In
addition to the shares which may be purchased  in this tender  offer,  our Board
has  authorized us to repurchase an additional  950,000 shares in open market or
other  purchases  subject to the  limitations on  repurchases  under our amended
stock term loan. See Section 11.

After the tender offer is completed,  we believe that our anticipated  cash flow
from  operations  and  financial  condition  will be  adequate  for  our  needs.
Depending on the number of shares  purchased in the tender offer, the result and
prospects of our business,  prevailing  economic and market  conditions  and the
market price of the shares, we may continue our previously authorized repurchase
program  subsequent  to the  termination  of the tender offer or engage in other
stock  repurchase  transactions.  However,  Rule 13e-4  under the  Exchange  Act
prohibits us and our affiliates  from  purchasing any shares,  other than in the
tender  offer,  until at least 10 business  days after the  expiration  date. In
addition, further repurchases are subject to limitations under our amended stock
term loan.

In setting the price range for our offer,  we considered the funds  available to
us and the increase in pro forma  earnings per share.  Our goal was to structure
the size and price of our offer so that it would be  appealing  to  stockholders
who may be interested in selling their shares and beneficial to stockholders who
may be interested in retaining their shares.

We believe the offer may be attractive from the perspective of our  stockholders
for the following reasons:

          o    The offer gives stockholders liquidity by giving them opportunity
               to  determine  the price or prices,  not greater  than $26.00 per
               share or less than $22.50 per share, at which they are willing to
               sell all or a portion of their  shares and,  if those  shares are
               purchased in our offer, to sell their shares for cash without the
               usual transaction costs associated with open-market sales.

          o    The offer  provides  stockholders  with the  opportunity  to sell
               their shares for a price that may be greater  than market  prices
               prevailing prior to the announcement of the offer.

          o    Any odd lot holders  whose shares are  purchased  pursuant to the
               offer not only will avoid the  payment of  brokerage  commissions
               for their sale of shares  directly to us, but also will avoid any
               applicable odd lot discounts payable on sales of odd lots.

          o    To the extent the  purchase  of shares in the offer  results in a
               reduction in the number of stockholders  of record,  the costs to
               us for services to stockholders will be reduced.

          o    The offer allows  stockholders  to sell a portion of their shares
               while retaining a continuing ownership interest in Pre-Paid Legal
               Services,  subject to the attendant  risk and rewards  associated
               with owning equity securities.

          o    Stockholders who do not tender their shares pursuant to the offer
               will realize a proportionate increase in their relative ownership
               interest in Pre-Paid  Legal  Services  and,  thus,  in our future
               earnings  and  assets,  subject to our right to issue  additional
               shares and other equity  securities  in the future.  Shareholders
               may be able to sell non-tendered  shares in the future on the New
               York Stock Exchange or otherwise,  at a net price higher or lower
               than the  purchase  price  in the  tender  offer.  We can give no
               assurance, however, as to the price at which a shareholder may be
               able to sell his or her shares in the future,  which price may be
               higher or lower than the purchase price paid in the tender offer.

The offer also presents some  potential  risks and  disadvantages  to us and our
continuing stockholders:

          o    The offer will result in a decrease in the amount of our cash and
               an increase in our indebtedness.

          o    The offer will  reduce our  "public  float" (the number of shares
               owned by outside  stockholders  and  available for trading in the
               securities markets). As of August 25, 2004, there were 16,460,515
               shares  issued and  outstanding.  Assuming  we acquire  1,000,000
               shares in the tender offer, 15,460,515 shares will be outstanding
               immediately  after the  tender  offer.  This may  result in lower
               stock prices or reduced  liquidity in the trading markets for our
               common  stock  in  the  future.  However,  based  upon  published
               guidelines  of the New  York  Stock  Exchange,  we  believe  that
               following  our  purchase  of shares  pursuant  to the offer,  our
               remaining shares will continue to qualify to be listed on the New
               York Stock Exchange.  The tender offer is conditioned  upon there
               not being any reasonable likelihood,  in our reasonable judgment,
               that the  consummation  of the tender  offer and the  purchase of
               shares  will  cause the shares to be  delisted  from the New York
               Stock Exchange. See Section 7.

Neither   Pre-Paid  Legal  Services  nor  our  board  of  directors   makes  any
recommendation  to any  stockholder  as to whether to tender all or any  shares.
Each stockholder must make his or her own decision whether to tender shares and,
if so, how many shares to tender and at what price. Our directors,  officers and
employees who own shares may  participate  in the offer on the same basis as our
other  stockholders.  We  have  been  advised  that  none of our  directors  and
executive  officers  intend to tender  their shares  pursuant to the offer.  See
Section  12 for  information  about the stock  ownership  of our  directors  and
executive officers.

Certain Additional Effects of the Tender Offer

Shares that we acquire  pursuant to the tender offer will be cancelled  and will
have the status of authorized but unissued shares.

The shares are registered  under the Exchange Act, which  requires,  among other
things,  that we furnish  information to our  shareholders and to the Securities
and Exchange Commission and comply with the Securities and Exchange Commission's
proxy rules in  connection  with meetings of  shareholders.  We believe that the
purchase of shares  pursuant  to the tender  offer will not result in the shares
becoming eligible for deregistration under the Exchange Act. The tender offer is
conditioned  upon there not being any reasonable  likelihood,  in our reasonable
judgment,  that the  consummation of the tender offer and the purchase of shares
will cause its common stock to be eligible for deregistration under the Exchange
Act. See Section 7.

The shares are  currently  "margin  securities"  under the rules of the  Federal
Reserve Board.  This has the effect,  among other things, of allowing brokers to
extend  credit to their  customers  using the shares as  collateral.  We believe
that,  following the purchase of the shares  pursuant to the tender  offer,  the
shares  will  continue  to be "margin  securities"  for  purposes of the Federal
Reserve Board's margin rules and regulations.

Plans or Proposals

Except as disclosed elsewhere in this offer to purchase,  or as may occur in the
ordinary  course of its business,  we currently  have no plans or proposals that
relate to or would result in:

          o    an extraordinary transaction, such as a merger, reorganization or
               liquidation, involving us or any of our subsidiaries;

          o    a purchase,  sale or transfer of a material  amount of our assets
               or any of its subsidiaries' assets;

          o    any  material  change in our  present  dividend  rate or  policy,
               indebtedness or capitalization;

          o    any  change in our  present  board of  directors  or  management,
               including,  but not limited to, any plans or  proposals to change
               the  number  or the term of  directors,  or to fill any  existing
               vacancies  on the board or to  change  any  material  term of the
               employment contract of any executive officer;

          o    any other material change in our corporate structure or business;

          o    a class of our equity  securities  being delisted from a national
               securities  exchange or ceasing to be  authorized to be quoted in
               an  automated   quotations   system  of  a  registered   national
               securities association;

          o    a  class  of  our  equity   securities   becoming   eligible  for
               termination of registration  pursuant to Section  12(g)(4) of the
               Exchange Act;

          o    the  suspension  of our  obligation  to file reports  pursuant to
               Section 15(d) of the Exchange Act;

          o    the  acquisition by any person of additional  securities of PPLS,
               or the disposition of securities by PPLS; or

          o    any changes in our charter, bylaws or other governing instruments
               or other actions that could impede the  acquisition of control of
               PPLS.

We reserve the right to change our plans and intentions at any time, as we deems
appropriate.

10.      INFORMATION CONCERNING PRE-PAID LEGAL SERVICES

Pre-Paid  Legal  Services,  Inc.,  incorporated  in Oklahoma in 1972,  develops,
underwrites  and markets  legal  expense  plans which provide for or reimburse a
portion  of the legal fees  associated  with a variety  of legal  services  in a
manner similar to medical reimbursement plans. Our main office is located at One
Pre-Paid Way, Ada, Oklahoma 62326; telephone number (580) 436-1234.

We are subject to the  information  requirements  of the Exchange  Act,  and, in
accordance therewith, we file periodic reports and other information relating to
our business, financial condition and other matters. We are required to disclose
in  these  periodic  reports  certain  information,   as  of  particular  dates,
concerning the our directors and executive officers,  their compensation,  stock
options granted to them, the principal holders of the securities of PPLS and any
material  interest of such  persons in  transactions  with us.  Pursuant to Rule
13e-4(c)(2)  under the  Exchange  Act,  we have  filed with the  Securities  and
Exchange  Commission  an Issuer  Tender  Offer  Statement  on  Schedule TO which
includes additional  information with respect to the tender offer. This material
and other  information  may be  inspected  at the  public  reference  facilities
maintained by the  Securities  and Exchange  Commission at Room 1024,  450 Fifth
Street,  N.W.,  Washington,  D.C.  20549.  Copies of this  material  can also be
obtained by mail,  upon  payment of the  Securities  and  Exchange  Commission's
customary  charges,  by  writing to the  Public  Reference  Section at 450 Fifth
Street,  N.W.,  Washington,  D.C. 20549. The Securities and Exchange  Commission
also  maintains a web site on the Internet at  http://www.sec.gov  that contains
periodic  reports and  information  statements and other  information  regarding
registrants   that  file   electronically   with  the  Securities  and  Exchange
Commission.

Our  annual  report on Form  10-K for the year  ended  December  31,  2003,  our
quarterly  reports on Form 10-Q for the  quarters  ended March 31, 2004 and June
30, 2004,  its Proxy  Statement on Schedule  14A filed with the  Securities  and
Exchange  Commission  on April 22, 2004,  our current  reports on Form 8-K dated
April 2, 2004,  April 26,  2004,  July 6, 2004,  and July 27, 2004 and all other
documents filed by PPLS with the Securities and Exchange  Commission pursuant to
Section 13(a),  13(c), 14 or 15(d) of the Exchange Act after the date hereof and
prior to the earlier of the  expiration  date and the  termination of the tender
offer shall be deemed incorporated herein by reference and shall be deemed to be
a part  hereof  from the date of  filing  of such  documents  and  reports.  Any
statement  contained in a document  incorporated or deemed to be incorporated by
reference herein, or contained in this offer to purchase,  shall be deemed to be
modified or superseded for purposes of this offer to purchase to the extent that
a statement  contained  herein or in any  subsequently  filed document or report
that also is or is deemed to be  incorporated  by reference  herein  modifies or
supersedes  such  statement.  Any  statement so modified  shall not be deemed to
constitute  a  part  of  this  offer  to  purchase,  except  as so  modified  or
superseded.

You can obtain any of the documents  incorporated  by reference in this document
from  PPLS or from the  Securities  and  Exchange  Commission's  web site at the
address described above.  Documents incorporated by reference are available from
PPLS without charge, excluding any exhibits to those documents. Shareholders can
obtain  documents  incorporated by reference in this document by requesting them
in writing or by telephone from PPLS at One Pre-Paid Way, Ada,  Oklahoma  74820;
telephone: (580) 436-1234. The documents are also available on the PPLS web site
and  can  be  downloaded  in  various  formats  at   www.prepaidlegal.com.   Any
shareholder requesting information should be sure to include his or her complete
name and address in the request. If you request any incorporated  documents,  we
will mail them to you by first  class mail,  or another  equally  prompt  means,
within one business day after we receive your request.

Selected Historical and Pro Forma Financial Information

The following tables show (a) selected  historical  financial  information about
PPLS for the  fiscal  year  ended  December  31,  2003 and as of and for the six
months ended June 30, 2004 and (b) selected pro forma financial  information for
the same  periods,  assuming  the  purchase by PPLS of  1,000,000  shares in the
tender offer at a purchase  price of $26.00 per share for an aggregate  purchase
price of $26.3 million, including related fees and expenses.

The  selected  pro  forma  information  is  based  on our  historical  financial
information  for the fiscal year ended  December 31, 2003 and for the six months
ended June 30, 2004 and gives  effect to the tender offer as if the tender offer
were completed at the beginning of each period for income statement  information
and at June 30, 2004 for balance sheet  information.  The pro forma  information
assumes  that we would  have  borrowed  approximately  $16.2  million  under our
amended stock term loan and used $10.1 million of excess cash on hand to finance
the tender offer. The impact on interest income and interest  expense  reflected
in the pro forma financial information is based on interest rates in the amended
stock term loan,  which are  subject  to  change.  As the pro forma  information
indicates,   total   stockholders'   equity  is  anticipated  to  decrease  from
$41,873,000  to  $15,573,000  at June 30,  2004,  and net  interest  expense  is
anticipated  to move from  $55,000 to $500,000 for the six months ended June 30,
2004 and net interest  income is anticipated to move from $1,238,000 to $337,000
for the  fiscal  year  ended  December  31,  2003.  The  anticipated  changes in
stockholders'  equity  and net  interest  expense  do not  adversely  affect the
Company's belief in the benefits of the offer.

The pro forma financial information is intended for informational  purposes only
and does not purport to be  indicative  of the results that would  actually have
been obtained if the tender offer had been  completed at the dates  indicated or
that  may be  obtained  at  any  date  in the  future.  The  following  selected
historical  financial  data  has been  derived  from  our  historical  financial
statements  included in our Form 10-K for the year ended  December  31, 2003 and
the Form 10-Q for the quarter ended June 30, 2004,  each of which has been filed
with the Securities Exchange Commission,  and should be read in conjunction with
those financial statements.



                                                                                  June 30, 2004
                                                                      --------------------------------------
                                                                           Actual             Pro Forma
                                                                      -----------------    -----------------
                                                                                 (In thousands,
                                                                            except per share values)
BALANCE SHEET
                                                                                     
Cash and cash equivalents..................................           $       17,517       $           7,417
Total current assets.......................................                   52,291                  42,191
Total assets...............................................                  131,709                 121,749
Short-term debt............................................                   17,564                  18,042
Total current liabilities..................................                   65,425                  65,903
Long-term debt.............................................                   16,380                  32,102
Total liabilities..........................................                   89,836                 106,176
Total stockholders' equity.................................                   41,873                  15,573
Shares outstanding at June 30, 2004........................                   16,492                  15,492
Book value per share.......................................           $         2.54       $            1.01






                                                              Six Months Ended               Twelve Months Ended
                                                               June 30, 2004                  December 31, 2003
                                                       -------------------------------    ---------------------------
                                                           Actual          Pro Forma        Actual       Pro Forma
                                                       ---------------    -------------    ---------    -------------
                                                           (In thousands, except percent and per share values)
INCOME STATEMENT
                                                                                         
Total revenues.....................................  $      190,038    $    190,038   $   361,313    $   361,313
Expenses (excluding interest)......................         158,490         158,490       301,975        301,975
Interest expense (income), net.....................              55             500        (1,238)          (337)
Income before income taxes.........................          31,493          31,048        60,576         59,675
Provision for income taxes.........................          10,865          10,711        20,669         20,358
Effective tax rate.................................           34.5%           34.5%         34.1%          34.5%
Net income.........................................          20,628          20,337        39,907         39,317
Income (loss) per common share:
         Basic.....................................            1.24            1.30          2.28           2.38
         Diluted...................................            1.24            1.30          2.27           2.37
Weighted average share outstanding:
         Basic.....................................          16,619          15,619        17,530         16,530
         Diluted...................................          16,692          15,692        17,599         16,599





                                                      Three Months Ended            Twelve Months Ended
                                                         June 30, 2004               December 31, 2003
                                                   --------------------------    ---------------------------
                                                     Actual        Pro Forma        Actual       Pro Forma
                                                   ------------    ----------     -----------   ------------
                                                                                        
Ratio of earnings to fixed charges                     37             25             86             39





Notes: The rate used for interest expense in the pro forma calculations,  and to
determine  the implied  interest  expense  from rent  expense is 4.51%.  Implied
interest  expense  from rent expense has been  calculated  by  multiplying  rent
expense by the interest rate for the applicable period. For the pro forma income
per share  calculations,  1,000,000 shares are subtracted from actual shares for
both the basic and diluted calculations.

11.      SOURCE AND AMOUNT OF FUNDS

Assuming that we purchase the maximum of 1,000,000 shares pursuant to this offer
at the highest  price of $26.00 per share,  the total  amount  required by us to
purchase these shares will be $26 million, exclusive of fees and other expenses.
We  anticipate  that we will  obtain  the funds  necessary  to  purchase  shares
tendered in the tender offer, as well as to pay related fees and expenses,  from
available cash on hand and by borrowing  under our amended stock term loan which
has recently been amended to increase the amount  available from the outstanding
balance of $13.9 million as of August 25, 2004 to up to $31.5 million. We intend
to repay amounts  borrowed  under the stock term loan for the purchase of shares
tendered in the tender offer with available cash flow or by refinancing  through
other available credit facilities.  The tender offer is not conditioned upon the
receipt of financing. See Section 7.

The amended stock term loan has been established pursuant to an amendment to our
loan  agreement  dated August 26, 2004,  among PPLS and Bank of Oklahoma,  N.A.,
Comerica  Bank,  and First  United  Bank & Trust.  The  amended  stock term loan
provides for advances of up to $31.5  million of which $13.9 million was already
advanced as of August 25, 2004.  Advances may be used to purchase  shares of our
common  stock in tender  offers,  reclassifications,  open market  purchases  or
otherwise  at any time  until  December  31,  2004.  The  amount  of the loan is
repayable in 24 equal monthly principal installments beginning October 31, 2004,
with interest at the 30 day LIBOR Rate plus three percent, adjusted monthly.

The amended  stock term loan  continues  to be primarily  collateralized  by our
rights to receive  membership  fees on a portion of our Memberships and a pledge
of the stock of our  subsidiaries.  The amended  loan  agreement  continues  the
existing covenants,  including  provisions  prohibiting us from pledging assets,
incurring  additional  indebtedness and selling assets. In addition to customary
events of default,  the amended loan continues the  additional  event of default
occurs if Harland C.  Stonecipher  ceases to be our Chairman and Chief Executive
Officer for 90 days.  Pre-payment  of the loan is  permitted.  The amended  loan
agreement contains the following  financial covenants which were included in the
original  loan:  (a) our  quarterly  Debt  Coverage  Ratio (which has an amended
definition)  shall not be less than 125%; (b) our cancellation rate on contracts
less than or equal to twelve  months old shall not  exceed 45% on a trailing  12
month  basis,  calculated  on a  quarterly  basis,  (c) and we shall  maintain a
rolling twelve month average retention rate of Membership contracts in place for
greater than  eighteen  months of not less than 70%,  calculated  on a quarterly
basis.  The amended loan modifies the existing  dividend and net worth limits to
provide that; (a) we may not pay dividends or make stock  purchases  (other than
with the loan proceeds or purchases of up to $31.5 million on or before December
31, 2004) in any fiscal quarter in excess of 50% of cumulative net income of all
previous  quarters since the quarter  beginning July 1, 2004, less any dividends
or  stock  purchases  in such  previous  quarters;  and (b) we are  required  to
maintain a tangible net worth of $10 million  through  December  31,  2004,  $15
million  through  September  30, 2005,  and $25 million on December 31, 2005 and
thereafter.

The foregoing description is qualified in its entirety by reference to the stock
term loan  agreement,  which is an  exhibit  to the  Schedule  TO in which  this
document has been filed with the Commission.

12.      INTEREST OF DIRECTORS AND OFFICERS; TRANSACTIONS AND ARRANGEMENTS
         CONCERNING SHARES

As of August 25, 2004,  Pre-Paid Legal Services had 16,460,515 shares issued and
outstanding, including shares allocated pursuant to our employee stock ownership
plan,  and  had  reserved   1,052,021  shares  for  issuance  upon  exercise  of
outstanding  stock  options and  1,341,252  reserved for future grants under the
stock  option  plan.  The  1,000,000  shares  that we are  offering  to purchase
represent approximately 6% of our outstanding shares. As of August 25, 2004, our
directors and executive  officers as a group, 12 persons,  beneficially owned an
aggregate of 1,921,254  shares,  including  673,000  shares covered by currently
exercisable   options   granted  under  our  stock  option  plan,   representing
approximately  11.21% of the outstanding shares,  assuming the exercise by these
persons  of  their  currently  exercisable  options.  Directors,   officers  and
employees of Pre-Paid Legal Services who own shares may participate in the offer
on the same basis as our other  stockholders.  We have been advised that none of
our  directors  or  executive  officers  intend  to tender  any of their  shares
pursuant to the offer. As of August 25, 2004,  227,692 shares,  or approximately
1.4% of the outstanding  shares, were held in our employee stock ownership plan.
Participants  in the employee  stock  ownership  plan will be entitled to tender
shares on the same terms as other  stockholders.  We also  maintain an associate
investment club which permits our sales  associates to purchase shares of common
stock in the open market.  As of August 25, 2004, the  participants in this club
owned an  aggregate  of  approximately  350,000  shares of common  stock.  These
participants  will be  entitled  to  tender  shares  on the same  terms as other
stockholders.

Assuming we purchase  1,000,000  shares  pursuant to the offer and our executive
officers and directors, then after the purchase of shares pursuant to the offer,
our  executive  officers  and  directors  as  a  group  would  own  beneficially
approximately  11.91% of the outstanding shares,  assuming the exercise by these
persons of their currently exercisable options.

The following  table sets forth certain  information  concerning  the beneficial
ownership  of shares of Common  Stock of the Company by each person  (other than
directors and executive  officers of the Company) known by the Company to be the
beneficial owner of more than five percent of the issued and outstanding  Common
Stock. The information is based on the most recent Schedules 13D or 13G filed by
the applicable  beneficial owner with the Securities and Exchange  Commission or
other information provided to the Company by the beneficial owner.



                                                                            Beneficial Ownership
                                                           --------------------------------------------------------
                                                                                          Percent of Class
                                                                                  ---------------------------------
Name and Address of Beneficial Owner                       Number of Shares         Before         After Offer(1)
------------------------------------
                                                                                     Offer
                                                           -----------------      ------------     ----------------

                                                                                               
Thomas W. Smith                                                4,038,951(2)          24.54              26.12
323 Railroad Avenue
Greenwich, CT  06830         ............................
Thomas N. Tryforos
323 Railroad Avenue
Greenwich, CT  06830         ............................      2,852,388(2)          17.3               18.45
Scott Vassalluzzo
323 Railroad Avenue
Greenwich, CT  06830         ............................      2,800,700(2)          17.01              18.12



(1) Assuming all 1,000,000 shares are purchased.

(2) Included in the shares of Common Stock  indicated as  beneficially  owned by
Thomas W. Smith ("Smith"), Thomas N. Tryforos ("Tryforos") and Scott Vassalluzzo
("Vassalluzzo")  are  2,780,600  shares as to which they have shared  voting and
shared dispositive power. In addition,  Smith beneficially owns 1,258,351 shares
of Common Stock as to which he has sole voting and dispositive  power,  Tryforos
beneficially  owns 71,788  shares of Common Stock as to which he has sole voting
and dispositive power and Vassalluzzo  beneficially owns 20,100 shares of Common
Stock as to which  he has sole  voting  and  dispositive  power.  Of the  shares
indicated as beneficially owned by Smith,  Tryforos and Vassalluzzo,  3,138,951,
2,791,988 and 2,791,600 shares in the aggregate,  respectively, are beneficially
owned in their capacities as investment managers for certain managed accounts.

Under the  provisions  of the  Oklahoma  General  Corporation  Act  relating  to
acquisitions  of shares  exceeding  20% of the  outstanding  voting shares of an
Oklahoma public company, 6,150 shares beneficially owned by Mr. Smith may not be
voted until and unless the  disinterested  shareholders  of the Company  approve
voting rights for these shares.  Mr. Smith has not requested  that such issue be
submitted to a vote of the  shareholders as required by these  provisions,  and,
accordingly,  these  6,150  shares are not  eligible  to be vote.  Although  Mr.
Smith's percentage ownership exceeds 20% by more than this number of shares, his
increase in  ownership  occurred  by reason of the  Company's  share  repurchase
program which does not result in a loss of voting rights.

Mssrs.  Smith,  Tryforos and Vassalluzzo have advised us that they do not intend
to tender any of their shares in the offer.

The following  table sets forth certain  information  concerning  the beneficial
ownership  of shares of Common Stock of the Company as of August 25, 2004 by (a)
each director of the Company, (b) certain executive officers, and (c) all of the
directors and certain executive officers of the Company as a group.



                                                                                           Percent of Class
                                                                                      ---------------------------
Name and Address of Beneficial Owner                            Number of Shares      Before         After Offer
------------------------------------
                                                                                        Offer
                                                                ------------------    ----------     ------------
                                                                                               
Harland C. Stonecipher                                              1,467,044(2)         8.74%          9.29%
One Pre-Paid Way
Ada, Oklahoma  74820       ...................................
Randy Harp                 ...................................        211,879(3)         1.27           1.36
Kathleen S. Pinson         ...................................         79,882(4)           *              *
Steve Williamson           ...................................         32,520(5)           *              *
Peter K. Grunebaum         ...................................         33,500(6)           *              *
John W. Hail               ...................................         48,079(7)           *              *
Martin H. Belsky           ...................................         33,350(8)           *              *
Steven R. Hague            ...................................         15,000(9)           *              *
All directors and executive officers as a group (8 persons)         1,921,254(10)       11.21          11.91
* Less than 1%.


(1) Unless  otherwise  indicated  in the  footnotes  to the table and subject to
community property laws where applicable, each of the shareholders named in this
table has sole voting and investment  power with respect to the shares indicated
as beneficially owned. The percentage of ownership for each person is calculated
in  accordance  with rules of the  Securities  and Exchange  Commission  without
regard to shares of Common Stock  issuable  upon exercise of  outstanding  stock
options,  except  that any shares a person is deemed to own by having a right to
acquire by exercise of an option are considered  outstanding solely for purposes
of calculating such person's percentage ownership.

(2) Included in the shares of Common Stock  indicated as  beneficially  owned by
Mr.  Stonecipher  are (i) 1,117,085  shares as to which he has shared voting and
shared  dispositive  power  with his wife;  (ii)  30,000  shares  issuable  upon
exercise of outstanding  options held by his wife earned during the time she was
a member of the Board of Directors;  (iii) 19,959 shares owned under the ESOP as
to which Mr.  Stonecipher has sole voting power, but shared  dispositive  power;
and,  (iv)  300,000  shares  issuable  to  Mr.   Stonecipher  upon  exercise  of
outstanding options.

(3)  Includes  17,829  shares owned under the ESOP as to which Mr. Harp has sole
voting power,  but shared  dispositive  power,  and 168,000 shares issuable upon
exercise of outstanding options.

(4) Includes  19,658 shares owned under the ESOP as to which Ms. Pinson has sole
voting power, but shared  dispositive power, and 15,000 shares issuable upon the
exercise of  outstanding  options.  Also,  includes 3,561 shares owned under the
ESOP by Ms. Pinson's  husband,  also an employee of the Company,  as to which he
has sole voting  power,  but shared  dispositive  power.  Ms.  Pinson  disclaims
beneficial ownership of shares that are owned by her husband.

(5) Includes  1,130 shares owned under the ESOP as to which Mr.  Williamson  has
sole  voting  power,  but  shared  dispositive  power,  372  shares  held  in an
individual  retirement  account  and 31,000  shares  issuable  upon  exercise of
outstanding options.

(6) Includes 33,500 shares issuable upon exercise of outstanding options.

(7) Includes 500 shares owned by a corporation that Mr. Hail controls and 47,500
shares issuable upon exercise of outstanding options.

(8) Includes 33,000 shares issuable upon exercise of outstanding options.

(9) Includes 15,000 shares issuable upon exercise of outstanding options

(10) Includes  673,000 shares issuable upon exercise of outstanding  options and
62,138 shares owned under the ESOP as to which the respective executive officers
and directors have sole voting power, but shared dispositive power.

We maintain an Employee  Stock  Ownership and Thrift Plan and Trust  pursuant to
which eligible  employees may be allocated shares of our common stock.  Eligible
employees  contribute  to  the  plan  by  payroll  deduction  or  by  additional
discretionary  payments  made  to the  trustee  and  we  make  certain  matching
contributions.    Seventy-five   percent   contributions   of   the   employee's
contributions  and  all of the  company's  contributions  are  then  used by the
trustee of the plan to purchase shares of our common stock.

We also maintain an associate  investment club whereby our sales  associates may
make open market purchases of our common stock.

Based  on  our  records  and on  information  provided  to us by its  directors,
executive  officers,  affiliates  and  subsidiaries,  except as provided  below,
neither PPLS nor any of its  affiliates or  subsidiaries  nor, to our knowledge,
any of our directors or executive  officers,  nor any associates or subsidiaries
of any of the  foregoing,  has effected any  transactions  involving  the shares
during the 60 days prior to August 26, 2004.  We purchased  50,400 shares in our
open market  repurchase  program  during such period.  Also, on August 5 and 10,
2004, Peter Gruenbaum,  one of our directors,  exercised  outstanding options to
purchase an  aggregate  of 3,000 shares for $17.03 per share and sold all of the
shares in the open market at prices of $23.25 to $23.35 per share.

There were no option grants to executive officers during 2004 through August 25,
2004,  but 36,751  options were granted to  non-executive  employees  and 40,000
options were granted to non-employee directors.

Except for  outstanding  options to purchase shares granted from to time to time
over  recent  years to certain  directors  and  employees,  including  executive
officers,  of Pre-Paid  Legal  Services  pursuant to our stock option plan,  and
except as otherwise  described  herein,  neither Pre-Paid Legal Services nor, to
the  best  of our  knowledge,  any of our  affiliates,  directors  or  executive
officers,  or  any  of  the  directors  or  executive  officers  of  any  of its
affiliates,  is  a  party  to  any  contract,   arrangement,   understanding  or
relationship  with any other person  relating,  directly or  indirectly,  to the
offer with respect to any securities of Pre-Paid Legal Services  including,  but
not  limited  to,  any  contract,  arrangement,  understanding  or  relationship
concerning the transfer or the voting of any such  securities,  joint  ventures,
loan or option  arrangements,  puts or calls,  guaranties  of loans,  guaranties
against   loss  or  the  giving  or   withholding   of   proxies,   consents  or
authorizations.

13.      LEGAL MATTERS; REGULATORY APPROVALS

We are not aware of any license or regulatory permit that appears to be material
to our business that might be adversely affected by our acquisition of shares as
contemplated  herein or of any  approval or other action by, or any filing with,
any  government  or  governmental,  administrative  or  regulatory  authority or
agency,  domestic or  foreign,  that would be required  for the  acquisition  or
ownership of shares by us as contemplated  herein.  Should any approval or other
action be required,  we presently  contemplate that the approval or other action
will be sought.  We are unable to predict  whether we may determine  that we are
required to delay the acceptance  for payment of or payment for shares  tendered
pursuant to this offer  pending the outcome of any such matter.  There can be no
assurance  that any approval or other  action,  if needed,  would be obtained or
would be obtained without  substantial  conditions or that the failure to obtain
any  approval or other action  might not result in adverse  consequences  to our
business.  Our  obligations  under the offer to accept for  payment  and pay for
shares is subject to certain conditions. See Section 7.

14.      CERTAIN FEDERAL INCOME TAX CONSEQUENCES

General.  The  following is a discussion of the material  United States  federal
income  tax  consequences  to  stockholders  with  respect  to a sale of  shares
pursuant  to the  offer.  The  discussion  is based upon the  provisions  of the
Internal Revenue Code,  Treasury  regulations,  Internal Revenue Service rulings
and judicial decisions, all in effect as of the date hereof and all of which are
subject to change,  possibly with retroactive effect, by subsequent legislative,
judicial or administrative  action.  The discussion does not address all aspects
of United States  federal  income  taxation that may be relevant to a particular
stockholder in light of the stockholder's particular circumstances or to certain
types of holders  subject to special  treatment  under the United States federal
income  tax  laws,   such  as   certain   financial   institutions,   tax-exempt
organizations,  life insurance  companies,  dealers in securities or currencies,
employee  benefit  plans  or  stockholders  holding  the  shares  as  part  of a
conversion  transaction,  as part of a hedge  or  hedging  transaction,  or as a
position in a straddle for tax purposes. In addition,  the discussion below does
not consider the effect of any foreign,  state, local or other tax laws that may
be applicable to particular stockholders. The discussion assumes that the shares
are held as "capital  assets" within the meaning of Section 1221 of the Internal
Revenue  Code.  We have  neither  requested  nor  obtained a written  opinion of
counsel or a ruling from the  Internal  Revenue  Service with respect to the tax
matters discussed below.

Each stockholder  should consult his or her own tax advisor as to the particular
United States  federal income tax  consequences  to that  stockholder  tendering
shares  pursuant  to the offer and the  applicability  and  effect of any state,
local or foreign tax laws and recent changes in applicable tax laws.

Characterization of the Surrender of Shares Pursuant to the Offer. The surrender
of shares by a stockholder to Pre-Paid Legal Services pursuant to the offer will
be a taxable  transaction  for United States federal income tax purposes and may
also be a taxable  transaction  under  applicable  state,  local and foreign tax
laws.  The United States federal income tax  consequences  to a stockholder  may
vary depending upon the stockholder's particular facts and circumstances.  Under
Section  302  of the  Internal  Revenue  Code,  the  surrender  of  shares  by a
stockholder to Pre-Paid Legal Services  pursuant to the offer will be treated as
a "sale or exchange" of shares for United  States  federal  income tax purposes,
rather than as a  distribution  by Pre-Paid  Legal  Services with respect to the
shares held by the tendering stockholder,  if the receipt of cash upon surrender
(i) is "substantially  disproportionate"  with respect to the stockholder,  (ii)
results in a "complete  redemption"  of the  stockholder's  interest in Pre-Paid
Legal  Services,  or (iii) is "not  essentially  equivalent to a dividend"  with
respect to the stockholder, each as described below.

If any of the above three tests is satisfied, and the surrender of the shares is
therefore  treated as a "sale or exchange" of shares for United  States  federal
income tax purposes, the tendering stockholder will recognize gain or loss equal
to the difference between the amount of cash received by the stockholder and the
stockholder's  tax basis in the shares  surrendered  pursuant to the offer.  Any
gain or loss will be capital gain or loss, and will be long term capital gain or
loss if the shares have been held for more than one year.

If none of the above three tests is satisfied, the tendering stockholder will be
treated as having  received a  distribution  by  Pre-Paid  Legal  Services  with
respect to the  stockholder's  shares in an amount equal to the cash received by
the stockholder  pursuant to the offer.  The  distribution  will be treated as a
dividend,  taxable as ordinary income to the extent of Pre-Paid Legal Services's
current or accumulated earnings and profits for tax purposes.  The amount of the
distribution  in excess of  Pre-Paid  Legal  Services's  current or  accumulated
earnings and profits will be treated as a return of the  stockholder's tax basis
in the shares,  and then as gain from the sale or  exchange of the shares.  If a
stockholder  is treated as having  received a  distribution  by  Pre-Paid  Legal
Services with respect to his or her shares,  the  stockholder's tax basis in his
or her  remaining  shares will  generally  be adjusted to take into  account the
stockholders return of basis in the shares tendered.

Constructive  Ownership.  In  determining  whether  any of the three tests under
Section 302 of the Internal  Revenue Code is satisfied,  stockholders  must take
into account not only the shares that are actually owned by the stockholder, but
also shares that are constructively  owned by the stockholder within the meaning
of Section 318 of the Internal  Revenue Code.  Under Section 318 of the Internal
Revenue Code, a stockholder may constructively own shares actually owned, and in
some cases constructively  owned, by certain related individuals or entities and
shares that the stockholder has the right to acquire by exercise of an option or
by conversion.

Proration.   Contemporaneous   dispositions  or  acquisitions  of  shares  by  a
stockholder  or related  individuals  or entities  may be deemed to be part of a
single  integrated  transaction  and may be taken into  account  in  determining
whether any of the three tests under  Section 302 of the  Internal  Revenue Code
has been satisfied.  Each stockholder should be aware that because proration may
occur in the offer, even if all the shares actually and constructively  owned by
a stockholder are tendered pursuant to the offer, fewer than all of these shares
may be purchased by Pre-Paid Legal Services.  Thus, proration may affect whether
the surrender of shares by a stockholder  pursuant to the offer will meet any of
the three tests under Section 302 of the Internal  Revenue  Code.  See Section 6
for information regarding each stockholder's option to make a conditional tender
of a minimum number of shares.  A stockholder  should consult his or her own tax
advisor  regarding  whether to make a conditional  tender of a minimum number of
shares, and the appropriate calculation thereof.

Section 302 Tests. The receipt of cash by a stockholder  will be  "substantially
disproportionate"  if the percentage of the outstanding shares in Pre-Paid Legal
Services  actually  and  constructively  owned  by the  stockholder  immediately
following the surrender of shares  pursuant to the offer is less than 80% of the
percentage of the outstanding  shares actually and  constructively  owned by the
stockholder  immediately  before  the  sale of  shares  pursuant  to the  offer.
Stockholders  should consult their tax advisors with respect to the  application
of the "substantially disproportionate" test to their particular situation.

The receipt of cash by a stockholder  will be a "complete  redemption" if either
(i) the stockholder owns no shares in Pre-Paid Legal Services either actually or
constructively  immediately  after the shares are  surrendered  pursuant  to the
offer,  or (ii) the  stockholder  actually  owns no  shares  in  Pre-Paid  Legal
Services  immediately  after the surrender of shares  pursuant to the offer and,
with respect to shares constructively owned by the stockholder immediately after
the offer,  the  stockholder  is  eligible  to waive,  and  effectively  waives,
constructive  ownership of all such shares under procedures described in Section
302(c) of the Internal Revenue Code. A director, officer or employee of Pre-Paid
Legal  Services  is not  eligible  to waive  constructive  ownership  under  the
procedures described in Section 302(c) of the Internal Revenue Code.

Even if the receipt of cash by a stockholder fails to satisfy the "substantially
disproportionate"  test and the "complete  redemption"  test, a stockholder  may
nevertheless satisfy the "not essentially  equivalent to a dividend" test if the
stockholder's surrender of shares pursuant to the offer results in a "meaningful
reduction" in the stockholder's interest in Pre-Paid Legal Services. Whether the
receipt  of cash by a  stockholder  will be  "not  essentially  equivalent  to a
dividend" will depend upon the individual stockholder's facts and circumstances.
The Internal  Revenue  Service has  indicated  in published  rulings that even a
small reduction in the proportionate interest of a small minority stockholder in
a publicly held corporation who exercises no control over corporate  affairs may
constitute such a "meaningful  reduction."  Stockholders  expecting to rely upon
the "not essentially equivalent to a dividend" test should consult their own tax
advisors as to its application in their particular situation.

Corporate  Stockholder  Dividend  Treatment.  If a sale of shares by a corporate
stockholder is treated as a dividend,  the corporate stockholder may be entitled
to claim a  deduction  equal to 70% of the  dividend  under  Section  243 of the
Internal Revenue Code, subject to applicable limitations. Corporate stockholders
should,  however,  consider the effect of Section 246(c) of the Internal Revenue
Code, which disallows the 70% dividends-received deduction with respect to stock
that is held  for 45 days or  less.  For  this  purpose,  the  length  of time a
taxpayer is deemed to have held stock may be reduced by periods during which the
taxpayer's risk of loss with respect to the stock is diminished by reason of the
existence of certain options or other transactions. Moreover, under Section 246A
of  the  Internal  Revenue  Code,  if  a  corporate   stockholder  has  incurred
indebtedness   directly  attributable  to  an  investment  in  shares,  the  70%
dividends-received deduction may be reduced.

In addition,  amounts received by a corporate  stockholder pursuant to the offer
that are treated as a dividend may constitute an "extraordinary  dividend" under
Section 1059 of the Internal Revenue Code. The "extraordinary dividend" rules of
the Internal  Revenue Code are highly  complicated.  Accordingly,  any corporate
stockholder  that  might  have a  dividend  as a result  of the  sale of  shares
pursuant  to the offer  should  review  the  "extraordinary  dividend"  rules to
determine the applicability and impact of such rules to it.

Additional Tax  Considerations.  The "Jobs and Growth Tax  Reconciliation Act of
2003"  significantly  alters the  treatment of  dividends  and long term capital
gains of  individuals.  Under this  legislation,  dividends  received in taxable
years  beginning  after 2002 and prior to 2009,  and long-term  capital gains on
sales and exchanges (and payments received) after May 6, 2003 and before January
1, 2009, by individuals  are taxed at a maximum rate of 15%. The rate applicable
to  individuals  with taxable  income at or below $29,050 (if single) or %58,100
(if married and filing  jointly) is 5% through the end of 2007 (0%) in 2008). In
order to qualify for the special rate for  dividends,  the shares must have been
held for more than 60 days during the 120 day period beginning on the date which
is 60 days before the date on which such share becomes  ex-dividend with respect
to such dividend (in this case,  prior to the repurchase  date) and the taxpayer
cannot be under an  obligation  (pursuant to a short sale or  otherwise) to make
related payments with respect to positions in  substantially  similar or related
property.  As such, these changes may impact the tax consequences of this tender
offer to certain stockholders.

Stockholders are urged to consult their own tax advisors  regarding any possible
impact on their  obligation  to make  estimated  tax payments as a result of the
recognition of any capital gain, or the receipt of any ordinary  income,  caused
by the surrender of any shares to Pre-Paid Legal Services pursuant to the offer.

Foreign  Stockholders.  Pre-Paid  Legal  Services  will  withhold  United States
federal  income tax at a rate of 30% from gross  proceeds  paid  pursuant to the
offer to a foreign  stockholder or his agent, unless we determine that a reduced
rate of withholding is applicable  pursuant to a tax treaty or that an exemption
from  withholding  is  applicable  because the gross  proceeds  are  effectively
connected  with the conduct of a trade or  business  by the foreign  stockholder
within  the  United  States.  For this  purpose,  a foreign  stockholder  is any
stockholder  that is not (i) a citizen or resident of the United States,  (ii) a
domestic  corporation  or  domestic  partnership,  (iii) an estate the income of
which from sources  without the United States is effectively  connected with the
conduct of a trade or business  within the United  States,  or (iv) a trust if a
court within the United States is able to exercise primary  supervision over the
administration  of the trust,  and one or more United  States  persons  have the
authority to control all substantial  decisions of the trust.  Without  definite
knowledge to the contrary,  we will determine whether a stockholder is a foreign
stockholder by reference to the stockholder's address. A foreign stockholder may
be  eligible  to file for a  refund  of the tax or a  portion  of the tax if the
stockholder    (a)   meets    the    "complete    redemption,"    "substantially
disproportionate" or "not essentially  equivalent to a dividend" tests described
above, (b) is entitled to a reduced rate of withholding pursuant to a treaty and
Pre-Paid Legal  Services  withheld at a higher rate, or (c) is otherwise able to
establish  that no tax or a reduced  amount of tax was due. In order to claim an
exemption  from  withholding  on the ground that gross proceeds paid pursuant to
the offer are effectively connected with the conduct of a trade or business by a
foreign  stockholder within the United States or that the foreign stockholder is
entitled to the benefits of a tax treaty,  the foreign  stockholder must deliver
to the depositary,  or other person who is otherwise required to withhold United
States tax, a properly executed  statement  claiming such exemption or benefits.
These statements may be obtained from the depositary.  Foreign  stockholders are
urged to consult  their own tax advisors  regarding  the  application  of United
States federal income tax withholding,  including  eligibility for a withholding
tax reduction or exemption and the refund procedures.

Backup Withholding.  See Section 3 with respect to the application of the United
States federal income tax backup withholding.

ESOP Plan. The ESOP Plan is a tax-exempt  trust and  therefore,  no gain or loss
will be  recognized  by the  participant  upon the tender of shares  credited to
their  account  under  the  ESOP  Plan.  However,  by  tendering  the  shares  a
participant  may be giving up special tax  consequences  applicable  to employer
securities upon  distribution of such shares from the ESOP Plan. Please refer to
the separate Letter to Participants sent to ESOP Plan participants together with
this Offer to Purchase for a description of these tax consequences.

Associate  Investment  Club.  The  Investment  Club  holds  title to the  shares
credited to  participants  in the Associate  Investment Club solely as agent for
the  participants.  Accordingly the tax  consequences to participants who tender
shares will be the same as any other stockholder.

The tax  discussion  set  forth  above  may not  apply  to  shares  acquired  in
connection with the exercise of stock options or pursuant to other  compensation
arrangements with Pre-Paid Legal Services.

The tax  consequences  of a sale pursuant to the offer may vary depending  upon,
among other things, the particular  circumstances of the tendering  stockholder.
No  information  is  provided  with  respect to the state,  local or foreign tax
consequences of the  transaction  contemplated  by the offer.  Stockholders  are
urged to consult  their own tax advisors to determine  the  particular  federal,
state,  local and foreign tax  consequences to them of tendering shares pursuant
to the offer and the effect of the stock ownership  attribution  rules described
above.

15.      EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENTS

We expressly reserve the right, in our sole discretion,  to extend the period of
time  during  which the offer is open by giving  oral or  written  notice of the
extension to the depositary and making a public announcement thereof.  There can
be no assurance,  however,  that we will exercise our right to extend the offer.
During any extension,  all shares previously tendered will remain subject to the
offer, except to the extent that shares may be withdrawn as set forth in Section
4. We also expressly reserve the right, in our sole discretion, (i) to terminate
the offer and not accept for  payment  any shares not  previously  accepted  for
payment or, subject to Rule  13e-4(f)(5)  under the  Securities  Exchange Act of
1934 which requires us either to pay the consideration  offered or to return the
shares  tendered  promptly after the  termination or withdrawal of the offer, to
postpone  payment  for  shares  upon  the  occurrence  of any of the  conditions
specified  in  Section  7  hereof,  by  giving  oral or  written  notice  of the
termination to the depositary and making a public announcement  thereof and (ii)
to amend the offer in any  respect.  Amendments  to the offer may be effected by
public announcement.  Without limiting the manner in which we may choose to make
public announcement of any extension, termination or amendment, we shall have no
obligation,  except  as  otherwise  required  by  applicable  law,  to  publish,
advertise or otherwise communicate any public announcement, other than by making
a release to PR News Wire, Dow Jones News Service,  or another  comparable  news
service,  except in the case of an announcement of an extension of the offer, in
which  case we shall have no  obligation  to  publish,  advertise  or  otherwise
communicate the announcement  other than by issuing a notice of the extension by
press  release or other  public  announcement,  which  notice shall be issued no
later  than  9:00  a.m.,  Central  time,  on the next  business  day  after  the
previously scheduled expiration date. Material changes to information previously
provided  to  holders  of the  shares in this  offer or in  documents  furnished
subsequent  thereto will be disseminated to holders of shares in compliance with
Rule 13e-4(e)(3) promulgated by the SEC under the Exchange Act.

If we materially change the terms of the offer or the information concerning the
offer,  or if we waive a material  condition  of the offer,  we will  extend the
offer to the extent  required by Rules  13e-4(d)(2)  and  13e-4(e)(3)  under the
Exchange Act.  Those rules require that the minimum period during which an offer
must  remain  open  following  material  changes  in the  terms of the  offer or
information  concerning  the  offer,  other  than a change in  price,  change in
dealer's  soliciting  fee or change in  percentage of  securities  sought,  will
depend on the facts and circumstances, including the relative materiality of the
terms or  information.  In a published  release,  the SEC has stated that in its
view,  an offer should  remain open for a minimum of five business days from the
date that notice of a material  change is first  published,  sent or given.  The
offer will  continue or be extended for at least ten business days from the time
Pre-Paid Legal Services publishes,  sends or gives to holders of shares a notice
that we will (i)  increase or decrease  the price we will pay for shares or (ii)
increase,  except for an increase not exceeding 2% of the outstanding shares, or
decrease the number of shares we seek.

16.      FEES AND EXPENSES

Georgeson Shareholder Communications,  Inc. will act as the information agent in
connection with the offer.  Georgeson  Shareholder,  as information  agent,  may
contact stockholders by mail,  telephone,  facsimile,  telex,  telegraph,  other
electronic means and personal interviews,  and may request brokers,  dealers and
other  nominee  stockholders  to  forward  materials  relating  to the  offer to
beneficial  owners. We have agreed to indemnify  Georgeson  Shareholder  against
certain liabilities, including liabilities under the federal securities laws, in
connection with the offer.

We have retained UMB Bank,  N.A. as depositary in connection  with the offer. We
have agreed to indemnify the depositary against certain  liabilities,  including
liabilities under the federal securities laws, in connection with the offer.

The  information  agent and  depositary  will receive  reasonable  and customary
compensation  for  their  services  and  will  also be  reimbursed  for  certain
out-of-pocket expenses. The amount of such compensation is not material to us.

We will not pay any fees or  commissions  to any broker,  dealer or other person
for soliciting  tenders of shares  pursuant to the offer. We will, upon request,
reimburse brokers, dealers,  commercial banks and trust companies for reasonable
and  customary  handling  and mailing  expenses  incurred by them in  forwarding
materials relating to the offer to their customers.

Neither  the  information  agent nor the  depositary  has been  retained to make
solicitations or recommendations in connection with the offer.

17.      MISCELLANEOUS

The offer is being made to all holders of shares.  We are not aware of any state
where the making of the offer is prohibited by administrative or judicial action
pursuant to a valid state statute. If we become aware of any valid state statute
prohibiting  the making of the offer, we will make a good faith effort to comply
with the statute.  If, after such good faith  effort,  we cannot comply with the
statute,  the offer will not be made to, nor will tenders be accepted from or on
behalf  of,  holders  of  shares in that  state.  In those  jurisdictions  whose
securities,  blue sky or other laws  require  the offer to be made by a licensed
broker  or  dealer,  the offer  shall be deemed to be made on our  behalf by the
dealer/manager  or one or more registered  brokers or dealers licensed under the
laws of these jurisdictions.

You should rely only on the  information  contained in this document or to which
we have  referred  you.  We have  not  authorized  anyone  to  provide  you with
information  or make any  representation  on our behalf in  connection  with the
offer other than those  contained in this Offer to Purchase,  the related Letter
of Transmittal or in the other documents that constitute a part of the offer. If
given or made,  you should not rely on that  information  or  representation  as
having been authorized by us.





                          PRE-PAID LEGAL SERVICES, INC.


                                 August 26, 2004

Questions and requests for assistance may be directed to the  information  agent
at the  telephone  number  listed  below.  Additional  copies  of this  offer to
purchase,  the letter of transmittal,  the notice of guaranteed  delivery or any
other tender offer materials may be obtained from the information agent. You may
also contact your  broker,  dealer,  bank,  trust  company or other  nominee for
assistance concerning the offer.

The information agent for the offer is:

                   GEORGESON SHAREHOLDER COMMUNICATIONS, INC.
                           17 State Street, 10th Floor
                            New York, New York 10004
                     Banks and Brokers Call: (212) 440-9800
                    All Others Call Toll Free: (866) 828-4305

The  letter of  transmittal,  certificates  for  shares  and any other  required
documents  should be sent or delivered by the  stockholder or the  stockholder's
broker,  dealer,  bank,  trust company or other nominee to the depositary at the
address listed below. Any questions concerning tender procedures may be directed
to the depositary at the telephone number listed below.

The depositary for the offer is:



                                  UMB BANK N.A.
                                                                                        
           By Mail:                      By Facsimile                        By Hand:                  By Overnight
                                         Transmission                                                    Courier:
        Pre-Paid Legal             For Eligible Institutions                 UMB Bank                  Pre-Paid Legal
         c/o UMB Bank                      Only:                        Securities Transfer             c/o UMB Bank
         P.O. Box 859208               (781) 380-3388                         Division                161 By Street Drive
      Briantree, MA  02185-      For Confirmation Only:                   928 Grand Blvd.                 Braintree, MA
            9208                  Telephone:  (781) 843-               Kansas City, MO 64106                 021814
                                      1833 ext. 200






                               EXHIBIT (a)(1)(ii)

                              LETTER OF TRANSMITTAL
                        TO TENDER SHARES OF COMMON STOCK
                                 PURSUANT TO THE
                OFFER TO PURCHASE FOR CASH DATED AUGUST 26, 2004
                                       BY
                          PRE-PAID LEGAL SERVICES, INC.
                                       OF
                   UP TO 1,000,000 SHARES OF ITS COMMON STOCK
                   AT A PURCHASE PRICE NOT GREATER THAN $26.00
                         NOR LESS THAN $22.50 PER SHARE
        THE TENDER OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
       NEW YORK CITY TIME, ON SEPTEMBER 28, 2004, UNLESS THE TENDER OFFER
                                  IS EXTENDED.



                     The Depositary for the Tender Offer is:
                                  UMB BANK N.A.
                                                                                         
              By Mail:                   By Facsimile Transmission:             By Hand:               By Overnight Courier:
           Pre-Paid Legal              For Eligible Institutions Only:          UMB Bank                   Pre-Paid Legal
            c/o UMB Bank                       (781) 380-3388              Securities Transfer              c/o UMB Bank
          P. O. Box 859208                 For Confirmation Only:               Division                161 Bay Street Drive
      Braintree, MA 02185-9208          Telephone: (781) 843-1833 ext        928 Grand Blvd.            Braintree, MA 02184
                                                     200                  Kansas City, MO 64106


THE OFFER TO  PURCHASE  AND THIS ENTIRE  LETTER OF  TRANSMITTAL,  INCLUDING  THE
ACCOMPANYING  INSTRUCTIONS,  SHOULD  BE READ  CAREFULLY  BEFORE  THIS  LETTER OF
TRANSMITTAL IS COMPLETED.

DELIVERY OF THIS LETTER OF  TRANSMITTAL  AND ALL OTHER  DOCUMENTS  TO AN ADDRESS
OTHER THAN AS SET FORTH  ABOVE,  WILL NOT  CONSTITUTE  A VALID  DELIVERY  TO THE
DEPOSITARY. DELIVERIES TO PRE-PAID LEGAL SERVICES, INC. OR GEORGESON SHAREHOLDER
COMMUNICATIONS,  INC.,  THE  INFORMATION  AGENT,  WILL NOT BE  FORWARDED  TO THE
DEPOSITARY AND THEREFORE,  WILL NOT CONSTITUTE VALID DELIVERY TO THE DEPOSITARY.
DELIVERIES  TO THE  BOOK-ENTRY  TRANSFER  FACILITY  WILL  NOT  CONSTITUTE  VALID
DELIVERY TO THE DEPOSITARY.



     


-----------------------------------------------------------------------------------------------------------------------------------


                         DESCRIPTION OF SHARES TENDERED

-----------------------------------------------------------------------------------------------------------------------------------
                                                                                         SHARES TENDERED
-----------------------------------------------------------------------------------------------------------------------------------
        NAMES AND ADDRESS(ES) OF REGISTERED HOLDER(S)           SHARE CERTIFICATE      TOTAL NUMBER OF SHARES         NUMBER OF
 (PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON                             REPRESENTED BY SHARE           SHARES
               SHARE CERTIFICATE(S) TENDERED)                       NUMBERS*               CERTIFICATE(S)*           TENDERED**
----------------------------------------------------------------------------------- ------------------------------ ----------------
-


                                                               -------------------- ------------------------------ ----------------


                                                               -------------------- ------------------------------ ----------------


                                                               -------------------- ------------------------------ ----------------


                                                               -------------------- ------------------------------ ----------------


                                                               -------------------- ------------------------------ ----------------


                                                               -------------------- ------------------------------ ----------------


                                                               -------------------- ------------------------------ ----------------


                                                               -------------------- ------------------------------ ----------------


                                                               -------------------- ------------------------------ ----------------


----------------------------------------------------------------------------------- ------------------------------ ----------------
Total Shares Tendered:
----------------------------------------------------------------------------------- ------------------------------ ----------------





Indicate in the space below the order (by  certificate  number) in which  shares
are to be purchased in event of proration***  (attach  additional signed list if
necessary): See Instruction 10.

1st: ________ 2nd: _________ 3rd: _________ 4th: ________ 5th: _________




[ ] Check here if any certificates representing shares tendered hereby have been
lost, stolen, destroyed or mutilated. You must complete an affidavit of loss and
return it with your Letter of Transmittal.  A bond will be required to be posted
by the  stockholder  to secure  against  the risk that the  certificates  may be
subsequently  recirculated.  Please  call the  Depositary  at (800)  884-4225 to
obtain an affidavit of loss and for further instructions as to the determination
of the requirement for posting of a bond. See Instruction 16.

* Does not need to be completed by stockholders  delivering shares by book-entry
transfer.

** If you desire to tender fewer than all shares  evidenced by any  certificates
listed  above,  please  indicate in this column the number of shares you wish to
tender.  Otherwise,  all shares evidenced by such certificates will be deemed to
have been tendered. See Instruction 4.

*** If you do not designate an order, in the event less than all shares tendered
are  purchased  due to  proration,  shares will be selected  for purchase by the
Depositary. See Instruction 10.

This Letter of Transmittal is to be used only if (1) certificates for shares are
to be forwarded with it, or such  certificates  will be delivered under a Notice
of Guaranteed  Delivery  previously  sent to the  Depositary  (as defined in the
Offer  to  Purchase),  or (2) a tender  of  shares  is to be made by  book-entry
transfer to the account  maintained by the  Depositary at The  Depository  Trust
Company,  referred to as the "book-entry transfer facility," pursuant to Section
3 of the Offer to Purchase.

Stockholders  who desire to tender  shares under the tender offer and who cannot
deliver the  certificates  for their shares or who are unable to comply with the
procedures for book-entry  transfer before the "expiration  date" (as defined in
Section 1 of the Offer to Purchase),  and who cannot deliver all other documents
required by this Letter of Transmittal  to the Depositary  before the expiration
date, may tender their shares  according to the guaranteed  delivery  procedures
set forth in Section 3 of the Offer to Purchase. See Instruction 2.

Your attention is directed in particular to the following:

1.   If you want to retain your shares, you do not need to take any action.

2.   If you want to  participate  in the tender  offer and wish to maximize  the
     chance of having PPLS accept for payment  shares you are tendering  hereby,
     you should check the box marked "Shares  Tendered at Price Determined Under
     the Tender  Offer" below and complete the other  portions of this Letter of
     Transmittal as  appropriate.  You should  understand that this election has
     the same  effect as if you had  selected  the  minimum  price of $22.50 per
     share.

3.   If you wish to select a specific  price at which you will be tendering your
     shares, you should select one of the boxes in the section captioned "Shares
     Tendered at Price  Determined by Stockholder"  below and complete the other
     portions of this Letter of Transmittal as appropriate.

IN ANY EVENT,  YOUR BANK OR BROKER CAN ASSIST YOU IN COMPLETING  THIS FORM.  THE
INSTRUCTIONS  INCLUDED  WITH  THIS  LETTER  OF  TRANSMITTAL  MUST  BE  FOLLOWED.
QUESTIONS AND REQUESTS FOR ASSISTANCE OR FOR  ADDITIONAL  COPIES OF THE OFFER TO
PURCHASE OR THIS LETTER OF TRANSMITTAL MAY BE DIRECTED TO THE INFORMATION  AGENT
AT THE ADDRESS OR TOLL-FREE NUMBER INDICATED ON THE BACK COVER OF THIS LETTER OF
TRANSMITTAL.  LIST BELOW THE  CERTIFICATE  NUMBERS AND NUMBER OF SHARES TO WHICH
THIS LETTER OF TRANSMITTAL  RELATES.  IF THE SPACE PROVIDED BELOW IS INADEQUATE,
LIST THE  CERTIFICATE  NUMBERS  TENDERED  ON A  SEPARATELY  EXECUTED  AND SIGNED
SCHEDULE  AND AFFIX THE  SCHEDULE TO THIS LETTER OF  TRANSMITTAL.  THE NAMES AND
ADDRESSES  OF THE HOLDERS  SHOULD BE  PRINTED,  IF NOT  ALREADY  PRINTED  BELOW,
EXACTLY AS THEY  APPEAR ON THE  CERTIFICATES  REPRESENTING  THE SHARES  TENDERED
HEREBY.  THE SHARES THAT THE UNDERSIGNED WISHES TO TENDER SHOULD BE INDICATED IN
THE APPROPRIATE BOXES.










________________________________________________________________________________
                               BOOK-ENTRY TRANSFER
                               (SEE INSTRUCTION 2)


[ ] CHECK HERE IF SHARES ARE BEING TENDERED BY BOOK-ENTRY TRANSFER TO AN ACCOUNT
MAINTAINED BY THE DEPOSITARY WITH THE BOOK-ENTRY  TRANSFER FACILITY AND COMPLETE
THE FOLLOWING (ONLY PARTICIPANTS IN THE BOOK-ENTRY TRANSFER FACILITY MAY DELIVER
SHARES BY BOOK-ENTRY TRANSFER):


Name(s) of Tendering Institution(s):
                                    --------------------------------------------

Account Number:
               -----------------------------------------------------------------

Transaction Code Number:
                         -------------------------------------------------------

________________________________________________________________________________




________________________________________________________________________________
                            PRIOR GUARANTEED DELIVERY
                               (SEE INSTRUCTION 2)

[ ] CHECK HERE IF SHARES ARE BEING  TENDERED  PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING:

Name(s) of Registered Holder(s):
                                ------------------------------------------------

--------------------------------------------------------------------------------


Window Ticket Number (if any):
                                ------------------------------------------------

Date of Execution of Notice of Guaranteed Delivery:
                                                   -----------------------------


Name of Institution which Guaranteed Delivery:
                                               ---------------------------------

Account Number (if delivered by Book-Entry Transfer):
                                                     ---------------------------

Transaction Code Number:
                          ------------------------------------------------------


[ ] CHECK  HERE IF  TENDER  IS  BEING  MADE IN  RESPECT  OF LOST,  MUTILATED  OR
DESTROYED CERTIFICATES. (SEE INSTRUCTION 16)

________________________________________________________________________________





________________________________________________________________________________
                                    ODD LOTS
                               (SEE INSTRUCTION 9)
-

To be  completed  only if shares are being  tendered by or on behalf of a person
owning, beneficially or of record an aggregate of fewer than 100 shares.

The undersigned either (CHECK ONE BOX):

[ ] is the  beneficial  or record owner of an aggregate of fewer than 100 shares
and is tendering all of those shares; or

[ ] is a broker, dealer, commercial bank, trust company or other nominee that:
________________________________________________________________________________

(a) is tendering,  for the beneficial  owner(s) thereof,  shares with respect to
which it is the record owner; and

(b) believes, based upon representations made to it by such beneficial owner(s),
that each such person is the beneficial  owner of an aggregate of fewer than 100
shares and is tendering all of such shares.
________________________________________________________________________________


In addition, the undersigned is tendering shares either (CHECK ONE BOX):


[ ] at the price per share indicated under "Shares  Tendered at Price Determined
by Stockholder" in Box A on page 6 of this Letter of Transmittal; or

[ ] at the purchase price, as the same shall be determined by PPLS in accordance
with the terms of the tender offer (persons checking this box should check Box B
on page 6).
________________________________________________________________________________

                   NOTE: SIGNATURES MUST BE PROVIDED ON PAGE 8
               PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY


To UMB Bank, N.A.:

The  undersigned  hereby tenders to Pre-Paid Legal  Services,  Inc., an Oklahoma
corporation ("PPLS"), the above-described shares of PPLS common stock, par value
$0.01 per share, at the price per share indicated in this Letter of Transmittal,
net to the seller in cash,  without interest,  upon the terms and subject to the
conditions set forth in PPLS's Offer to Purchase, dated August 26, 2004, receipt
of which is hereby  acknowledged,  and in this Letter of Transmittal  which,  as
amended  and  supplemented  from time to time,  together  constitute  the tender
offer.

Subject to and effective on acceptance for payment of the shares tendered hereby
in  accordance  with the terms of and  subject to the  conditions  of the tender
offer  (including,  if the tender  offer is extended  or amended,  the terms and
conditions of any such extension or amendment),  the  undersigned  hereby sells,
assigns  and  transfers  to,  or upon the order of,  PPLS all  right,  title and
interest in and to all shares tendered hereby and orders the registration of all
such shares if tendered by book-entry  transfer  that are purchased  pursuant to
the tender offer to or upon the order of PPLS and hereby irrevocably constitutes
and appoints the Depositary as the true and lawful agent and attorney-in-fact of
the  undersigned  with respect to such shares (with the full  knowledge that the
Depositary  also  acts as the agent of PPLS),  with full  power of  substitution
(such power of attorney being deemed to be an irrevocable  power coupled with an
interest), to:

(1)  deliver  certificates  representing such shares,  or transfer  ownership of
     such shares on the account  books  maintained  by the  book-entry  transfer
     facility, together, in either such case, with all accompanying evidences of
     transfer and  authenticity,  to or upon the order of PPLS,  upon receipt by
     the  Depositary,  as the  undersigned's  agent,  of the purchase price with
     respect to such shares;

(2)  present  certificates  for such  shares for  cancellation  and  transfer on
     PPLS's books; and

(3)  receive  all  benefits  and  otherwise  exercise  all rights of  beneficial
     ownership of such shares, subject to the next paragraph,  all in accordance
     with the terms and subject to the conditions of the tender offer.

The undersigned hereby covenants, represents and warrants to PPLS that:

(4)  the  undersigned  understands  that  tendering  shares under any one of the
     procedures  described  in  Section  3 of the Offer to  Purchase  and in the
     instructions  hereto will  constitute the  undersigned's  acceptance of the
     terms and  conditions  of the tender  offer,  including  the  undersigned's
     representation  and  warranty  that  (i)  the  undersigned  has a net  long
     position in shares or  equivalent  securities  at least equal to the shares
     tendered within the meaning of Rule 14e-4 under the Securities Exchange Act
     of 1934, as amended (the  "Exchange  Act"),  and (ii) such tender of shares
     complies with Rule 14e-4 under the Exchange Act;

(c)  when and to the extent  PPLS  accepts  the shares for  purchase,  PPLS will
     acquire good,  marketable and unencumbered title to them, free and clear of
     all security interests,  liens,  charges,  encumbrances,  conditional sales
     agreements or other obligations relating to their sale or transfer, and not
     subject to any adverse claim;

(d)  on request,  the  undersigned  will  execute  and  deliver  any  additional
     documents the  Depositary or PPLS deems  necessary or desirable to complete
     the assignment, transfer and purchase of the shares tendered hereby; and

(e)  the  undersigned  has read and  agrees  to all of the  terms of the  tender
     offer.

The name(s) and address(es) of the registered  holder(s)  should be printed,  if
they are not already printed above,  exactly as they appear on the  certificates
representing  shares tendered  hereby.  The certificate  numbers,  the number of
shares  represented  by such  certificates,  and the  number of shares  that the
undersigned  wishes to  tender,  should be set  forth in the  appropriate  boxes
above.  The price at which such shares are being tendered should be indicated in
the box below.

The  undersigned  understands  that PPLS will, upon the terms and subject to the
conditions of the tender offer, determine a single per share purchase price, not
in excess of $26.00 nor less than $22.50 per share,  that it will pay for shares
properly tendered and not properly  withdrawn prior to the expiration date under
the tender  offer,  taking into account the number of shares so tendered and the
prices  specified  (in  increments  of  $.50)  by  tendering  stockholders.  The
undersigned  understands  that PPLS will select the lowest  purchase  price that
will allow it to purchase  1,000,000  shares, or such lesser number of shares as
are properly  tendered and not  properly  withdrawn,  at prices not greater than
$26.00 nor less than $22.50 per share,  under the tender  offer,  subject to its
right to increase the total number of shares  purchased to the extent  permitted
by law. The undersigned  understands that all shares properly tendered at prices
at or below the purchase  price and not properly  withdrawn will be purchased at
the purchase price, net to the seller in cash, without interest,  upon the terms
and  subject to the  conditions  of the  tender  offer,  including  its odd lot,
proration and conditional tender provisions, and that PPLS will return all other
shares,  including shares tendered at prices greater than the purchase price and
not  properly  withdrawn  and  shares not  purchased  because  of  proration  or
conditional tenders, promptly following the expiration date.

The  undersigned  recognizes that under certain  circumstances  set forth in the
Offer to Purchase,  PPLS may terminate or amend the tender offer or may postpone
the acceptance for payment of, or the payment for, shares tendered or may accept
for  payment  fewer  than all of the shares  tendered  hereby.  The  undersigned
understands  that  certificate(s)  for any  shares  delivered  herewith  but not
tendered or not  purchased  will be returned to the  undersigned  at the address
indicated above. The undersigned  recognizes that PPLS has no obligation,  under
the "Special Payment  Instructions," to transfer any certificate for shares from
the name of its registered  holder,  or to order the registration or transfer of
shares  tendered by book-entry  transfer,  if PPLS  purchases none of the shares
represented by such certificate or tendered by such book-entry transfer.

The undersigned  understands  that acceptance of shares by PPLS for payment will
constitute a binding  agreement  between the undersigned and PPLS upon the terms
and subject to the conditions of the tender offer. The undersigned  acknowledges
that no  interest  will  be  paid on the  purchase  price  for  tendered  shares
regardless  of any  extension  of the tender  offer or any delay in making  such
payment.

The check for the aggregate net purchase  price for such of the tendered  shares
as are  purchased  by PPLS will be issued  to the order of the  undersigned  and
mailed to the address indicated above unless otherwise indicated under either of
the "Special Payment Instructions" or the "Special Delivery  Instructions" boxes
below.

All authority  conferred or agreed to be conferred in this Letter of Transmittal
shall survive the death or incapacity of the undersigned, and any obligations or
duties of the undersigned under this Letter of Transmittal shall be binding upon
the heirs,  personal  representatives,  executors,  administrators,  successors,
assigns,  trustees in bankruptcy and legal  representatives  of the undersigned.
Except as stated in the Offer to Purchase, this tender is irrevocable.

               PRICE PER SHARE AT WHICH SHARES ARE BEING TENDERED
                               (SEE INSTRUCTION 5)

BOX A

--------------------------------------------------------------------------------
SHARES TENDERED AT PRICE DETERMINED BY STOCKHOLDER

By  checking  one of the boxes  below  instead  of the box under Box B,  "Shares
Tendered at Price  Determined Under the Tender Offer," I hereby tender shares at
the price checked.  I understand  this action could result in none of the shares
being purchased if the purchase price  determined by PPLS for the shares is less
than the price checked below. A stockholder who desires to tender shares at more
than one price must complete a separate  Letter of Transmittal for each price at
which shares are tendered. The same shares cannot be tendered, unless previously
properly  withdrawn as provided in Section 4 of the Offer to  Purchase,  at more
than one price.

PRICE (IN  DOLLARS)  PER SHARE AT WHICH  SHARES  ARE BENG  TENDERED  (CHECK  THE
APPROPRIATE BOX TO INDICATE THE TENDER PRICE, NOT TO BE LESS THAN $22.50 AND NOT
TO EXCEED $26.00):

[  ] $22.50     [  ] $23.00     [  ] $23.50     [  ] $24.00     [  ] $24.50

[  ] $25.00     [  ] $25.50     [  ] $26.00



Check the appropriate box above or, alternatively, check the box below under Box
B, "Shares  Tendered at Prices  Determined  Under the Tender  Offer." Unless you
check  the box  under  Box B, if you do not  check one and only one of the boxes
above,     you    will    not    have    validly     tendered    your    shares.
--------------------------------------------------------------------------------


OR

BOX B

--------------------------------------------------------------------------------
SHARES TENDERED AT PRICE DETERMINED UNDER THE TENDER OFFER

[ ] I want to maximize  the chance of having PPLS accept for purchase all of the
shares  that  I  am  tendering   (subject  to  the  possibility  of  proration).
Accordingly, by checking this box instead of one of the boxes in Box A, I hereby
tender  shares at, and am willing to accept,  the purchase  price  determined by
PPLS in accordance  with the terms of the tender offer. I understand this action
has the same  effect as if I  selected  the  minimum  price of $22.50 per share.
--------------------------------------------------------------------------------

YOU WILL NOT HAVE VALIDLY  TENDERED  YOUR SHARES IF MORE THAN ONE BOX IS CHECKED
OR IF NO BOX IS CHECKED.

                     CONDITIONAL TENDER (SEE INSTRUCTION 6)


A  stockholder  may tender  shares  subject to the  condition  that a  specified
minimum number of the  stockholder's  shares tendered pursuant to this Letter of
Transmittal  must be purchased  if any shares  tendered  are  purchased,  all as
described in the Offer to Purchase,  particularly  in Section 6 thereof.  Unless
the minimum number of shares  indicated below is purchased by PPLS in the tender
offer, none of the shares tendered by such stockholder will be purchased.  It is
the  responsibility of the stockholder to calculate the minimum number of shares
that must be  purchased if any are  purchased,  and PPLS urges  stockholders  to
consult their own tax advisor before  completing  this section.  Unless this box
has  been  checked  and  a  minimum   specified,   the  tender  will  be  deemed
unconditional.

[ ] Minimum  number of shares  that  must be  purchased,  if any are  purchased:
________ shares.

If, because of proration,  the minimum number of shares  designated  will not be
purchased,  PPLS may accept  conditional  tenders by random lot,  if  necessary.
However,  to be eligible for purchase by random lot, the  tendering  stockholder
must have tendered all of his or her shares and checked the box below.

[ ] The tendered shares represent all shares held by the undersigned.

--------------------------------------------------------------------------------
                          SPECIAL PAYMENT INSTRUCTIONS
                      (SEE INSTRUCTIONS 1, 4, 7, 8 AND 11)
To be completed ONLY if certificates  for shares not tendered,  and/or any check
for the  purchase  price are to be issued in the name of someone  other than the
undersigned,  or if shares tendered hereby and delivered by book-entry  transfer
which are not  accepted  for  payment are to be returned by credit to an account
maintained at the Book-Entry Transfer Facility other than that designated above.

Issue [ ] check:

[ ] share certificate(s) to:

Name(s):
          ---------------------------------------------------     (PLEASE PRINT)

          ---------------------------------------------------
Address:
          ----------------------------------------------------------------------
                                       (INCLUDE ZIP CODE)

                      ----------------------------------------------------------
                            (TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
                              (SEE SUBSTITUTE FORM W-9 INCLUDED HEREWITH)
[ ] Credit  shares  delivered by  book-entry  transfer and not  purchased to the
account set forth below:

                                     ----------------------
                                        (ACCOUNT NUMBER)
--------------------------------------------------------------------------------



--------------------------------------------------------------------------------
                          SPECIAL DELIVERY INSTRUCTIONS
                        (SEE INSTRUCTIONS 1, 4, 7 AND 11)
To be completed ONLY if certificates  for shares not tendered,  and/or any check
for the purchase price are to be sent to someone other than the undersigned,  or
to the undersigned at an address other than that shown above.

Send [ ] check:

[ ] share certificate(s) to:

Name:
          ---------------------------------------------------     (PLEASE PRINT)

          ---------------------------------------------------

Address:
--------------------------------------------------------------------------------



--------------------------------------------------------------------------------
                                    IMPORTANT
               STOCKHOLDER(S) SIGN HERE (SEE INSTRUCTIONS 1 AND 7)
     (PLEASE ALSO COMPLETE AND RETURN SUBSTITUTE FORM W-9 CONTAINED HEREIN)
X
  -----------------------------------------------------------
X
  -----------------------------------------------------------
                                    SIGNATURE(S) OF HOLDER(S)

Dated:
      -----------------------------

(Must be signed by the  registered  holder(s)  exactly  as the  name(s)  of such
holder(s)  appear(s) on  certificate(s)  or on a security position listing or by
person(s)  authorized to become registered holder(s) thereof by certificates and
documents  transmitted  with this Letter of  Transmittal.  If  signature is by a
trustee,  executor,  administrator,  guardian,  attorney-in-fact,  officer  of a
corporation  or other person acting in a fiduciary or  representative  capacity,
please  provide the  following  information  and see  Instruction  7.)

Name(s):
        -----------------------------------------------------     (PLEASE PRINT)

        -----------------------------------------------------

Capacity  (full title):
                       ---------------------------------------------------------

 Address:
         -----------------------------------------------------------------------
                               (INCLUDE ZIP CODE)

                -------------------------------------------------
                      (DAYTIME AREA CODE AND TELEPHONE NO.)

                     --------------------------------------
                 (TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
                   (SEE SUBSTITUTE FORM W-9 INCLUDED HEREWITH)

--------------------------------------------------------------------------------



--------------------------------------------------------------------------------
                            GUARANTEE OF SIGNATURE(S)
                    (IF REQUIRED -- SEE INSTRUCTIONS 1 AND 7)

Authorized Signature

Name(s):
        -----------------------------------------------------

        -----------------------------------------------------

Title:
      -------------------------------------------------------

Name of Firm:
              -----------------------------------------------

Address:
         ----------------------------------------------------
                               (INCLUDE ZIP CODE)

            -------------------------------------------------
                   (DAYTIME AREA CODE AND TELEPHONE NO.)

Dated:
       ------------------------------------------------------

--------------------------------------------------------------------------------





                      INSTRUCTIONS TO LETTER OF TRANSMITTAL
                  FORMING PART OF THE TERMS OF THE TENDER OFFER

1.   Guarantee of Signatures. No signature guarantee is required if either:
(5)  this Letter of Transmittal is signed by the registered holder of the shares
     exactly as the name of the registered  holder  appears on the  certificate,
     which term, for purposes of this document, shall include any participant in
     a book-entry  transfer  facility whose name appears on a security  position
     listing as the owner of shares,  tendered with this Letter of  Transmittal,
     and payment and delivery are to be made directly to such registered  holder
     unless  such  registered  holder  has  completed  either  the box  entitled
     "Special Payment Instructions" or "Special Delivery Instructions" above; or

(6)  such shares are tendered for the account of a bank, broker,  dealer, credit
     union,  savings  association  or other  entity  which  is a member  in good
     standing of the Securities  Transfer Agents  Medallion  Program,  the Stock
     Exchange  Medallion  Program,  the New York Stock Exchange,  Inc. Medallion
     Signature  Program  or  a  bank,  broker,  dealer,  credit  union,  savings
     association or other entity which is an "eligible  guarantor  institution,"
     as such term is defined in Rule 17Ad-15  under the Exchange  Act, each such
     entity, referred to as an "Eligible Institution."

In all other cases,  signatures on this Letter of Transmittal must be guaranteed
by an Eligible Institution.  Stockholders may also need to have any certificates
they deliver  endorsed or  accompanied  by a stock power,  and the  signature on
these documents may also need to be guaranteed. See Instruction 7.

2.  Delivery of Letter of  Transmittal  and  Certificates;  Guaranteed  Delivery
Procedures.  This Letter of Transmittal is to be used only if  certificates  are
delivered  with it to the  Depositary,  or such  certificates  will be delivered
under a Notice of Guaranteed Delivery  previously sent to the Depositary,  or if
tenders  are to be made  concurrently  pursuant to the  procedure  for tender by
book-entry   transfer  set  forth  in  Section  3  of  the  Offer  to  Purchase.
Certificates for all physically tendered shares, or confirmation of a book-entry
transfer into the Depositary's  account at the book-entry  transfer  facility of
shares tendered electronically,  together in each case with a properly completed
and duly executed Letter of Transmittal or manually  signed  facsimile of it, or
an Agent's Message  (defined  below),  and any other documents  required by this
Letter of  Transmittal,  should be mailed or delivered to the  Depositary at the
appropriate  address set forth  herein and must be  received  by the  Depositary
before the expiration  date.  DELIVERY OF DOCUMENTS TO THE  BOOK-ENTRY  TRANSFER
FACILITY IN ACCORDANCE WITH SUCH BOOK-ENTRY TRANSFER FACILITY'S  PROCEDURES DOES
NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.

The  term  "Agent's  Message"  means a  message  transmitted  by the  book-entry
transfer  facility to, and received  by, the  Depositary,  which states that the
book-entry  transfer  facility has received an express  acknowledgment  from the
participant in such book-entry transfer facility tendering the shares, that such
participant  has  received  and agrees to be bound by the terms of the Letter of
Transmittal, and that PPLS may enforce such agreement against such participant.

Stockholders  whose  certificates  are not  immediately  available or who cannot
deliver  certificates  for their shares and all other required  documents to the
Depositary  before the  expiration  date,  or whose  shares  cannot be delivered
before the expiration  date under the procedures  for book-entry  transfer,  may
tender their shares by or through any eligible guarantor institution by properly
completing and duly executing and delivering a Notice of Guaranteed Delivery, or
facsimile  of it,  and by  otherwise  complying  with  the  guaranteed  delivery
procedure set forth in Section 3 of the Offer to Purchase. Under such procedure,
the certificates for all physically tendered shares or book-entry  confirmation,
as the case may be, as well as a properly  completed and duly executed Letter of
Transmittal,  or manually signed facsimile of it, or an Agent's Message, and all
other documents required by this Letter of Transmittal,  must be received by the
Depositary  within three  business days after receipt by the  Depositary of such
Notice of  Guaranteed  Delivery,  all as  provided  in Section 3 of the Offer to
Purchase.

The  Notice  of  Guaranteed  Delivery  may  be  delivered  by  hand,   facsimile
transmission  or mail to the  Depositary  and  must  include,  if  necessary,  a
guarantee  by an eligible  guarantor  institution  in the form set forth in such
notice.  For  shares  to be  tendered  validly  under  the  guaranteed  delivery
procedure,  the Depositary must receive the Notice of Guaranteed Delivery before
the expiration date.

THE METHOD OF DELIVERY OF ALL DOCUMENTS,  INCLUDING  CERTIFICATES FOR SHARES, IS
AT THE OPTION AND RISK OF THE  TENDERING  STOCKHOLDER.  IF  DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY.

PPLS will not accept any alternative or contingent tenders, nor will it purchase
any fractional shares except as expressly provided in the Offer to Purchase. All
tendering  stockholders,  by  execution  of this  Letter  of  Transmittal,  or a
facsimile  of it,  waive any right to receive  any notice of the  acceptance  of
their tender.

3.   Inadequate  Space. If the space provided in the box captioned  "Description
     of Shares Tendered" is inadequate, the certificate number and/or the number
     of shares  should be listed on a separate  signed  schedule and attached to
     this Letter of Transmittal.

4.   Partial Tenders and Unpurchased Shares. (Not applicable to stockholders who
     tender by book-entry  transfer.) If fewer than all of the shares  evidenced
     by any  certificate(s)  are to be  tendered,  fill in the  number of shares
     which are to be tendered in the column entitled "Number of Shares Tendered"
     in the box entitled  "Description of Shares  Tendered" above. In such case,
     if any tendered  shares are purchased,  a new certificate for the remainder
     of the shares evidenced by the old  certificate(s)  will be issued and sent
     to the registered  holder(s) thereof,  unless otherwise specified in either
     the  box  entitled  "Special  Payment  Instructions"  or the  box  entitled
     "Special  Delivery  Instructions"  in this Letter of Transmittal,  promptly
     after  the  expiration  date.  Unless  otherwise   indicated,   all  shares
     represented by the certificates listed and delivered to the Depositary will
     be deemed to have been tendered.

5.   Indication  of Price at Which Shares are Being  Tendered.  For shares to be
     properly tendered, the stockholder must either (1) check the box indicating
     the price per share at which such  stockholder is tendering shares in Box A
     above,  titled "Shares Tendered at Price Determined by Stockholder" in this
     Letter of  Transmittal;  or (2)  check  the box  above in Box B,  captioned
     "Shares  Tendered at Price  Determined  Under the Tender Offer" in order to
     maximize  the chance of having  PPLS  purchase  all of the shares  tendered
     (subject to the  possibility  of  proration).  Selecting Box B has the same
     effect as selecting  the minimum  price per share of $22.50.  A stockholder
     may complete only Box A or Box B. If both Box A and Box B are completed, or
     neither Box A nor Box B are completed, there is no proper tender of shares.
     A  stockholder  wishing  to tender  portions  of such  stockholder's  share
     holdings at different prices must complete a separate Letter of Transmittal
     for each price at which such stockholder wishes to tender each such portion
     of such stockholder's shares. To obtain additional copies of this Letter of
     Transmittal,  contact  the  Information  Agent (as  defined in the Offer to
     Purchase) at the  telephone  number and address set forth on the back cover
     of this Letter of Transmittal. The same shares cannot be tendered more than
     once, unless previously  properly withdrawn as provided in Section 4 of the
     Offer to Purchase.

6.   Conditional  Tenders.  As described in Section 3 and Section 6 of the Offer
     to Purchase,  stockholders  may condition their tenders on all or a minimum
     number of their  tendered  shares being  purchased.  If PPLS is to purchase
     less than all of the shares  tendered  before the  expiration  date and not
     properly  withdrawn,  the Depositary will perform a preliminary  proration,
     and any  shares  tendered  at or below the  purchase  price  pursuant  to a
     conditional   tender  for  which  the  condition  was  not  satisfied  will
     automatically  be regarded as withdrawn,  subject to  reinstatement if such
     conditionally  tendered shares are subsequently  selected by random lot for
     purchase subject to Sections 3 and 6 of the Offer to Purchase.  CONDITIONAL
     TENDERS  WILL BE SELECTED BY RANDOM LOT ONLY FROM  STOCKHOLDERS  WHO TENDER
     ALL OF THEIR SHARES. If conditional  tenders would otherwise be so regarded
     as withdrawn  and would cause the total number of shares to be purchased to
     fall below 1,000,000 then, to the extent feasible,  PPLS will select enough
     of such conditional  tenders that would otherwise have been so withdrawn to
     permit  PPLS  to  purchase   1,000,000  shares.  In  selecting  among  such
     conditional  tenders,  PPLS will  select by random  lot and will  limit its
     purchases  in each case to the  designated  minimum  number of shares to be
     purchased.  All  tendered  shares will be deemed  unconditionally  tendered
     unless the "Conditional  Tender" box is completed.  The conditional  tender
     alternative  is made  available so that a  stockholder  may assure that the
     purchase of shares from the  stockholder  pursuant to the tender offer will
     be  treated  as a sale of the shares by the  stockholder,  rather  than the
     payment of a dividend to the stockholder,  for federal income tax purposes.
     It is the tendering  stockholder's  responsibility to calculate the minimum
     number of shares that must be purchased  from the  stockholder in order for
     the stockholder to qualify for sale (rather than dividend)  treatment,  and
     each  stockholder is urged to consult with his or her own tax advisor.  See
     Section 14 of the Offer to Purchase.

Any tendering  stockholder  wishing to make a conditional  tender must calculate
and appropriately  indicate such minimum number of shares. Odd lot shares, which
will not be subject to proration, cannot be conditionally tendered.

7.   Signatures on Letter of Transmittal, Stock Powers and Endorsements.

(a)  If this Letter of Transmittal is signed by the registered  holder(s) of the
     shares tendered hereby,  the signature(s) must correspond  exactly with the
     name(s)  as written on the face of the  certificate(s)  without  any change
     whatsoever.

(b)  If the shares  tendered  hereby are  registered in the names of two or more
     joint holders, each such holder must sign this Letter of Transmittal.

(c)  If any  tendered  shares  are  registered  in  different  names on  several
     certificates,  it will be necessary  to  complete,  sign and submit as many
     separate  Letters  of  Transmittal,  or  photocopies  of it,  as there  are
     different registrations of certificates.

(d)  When this Letter of Transmittal  is signed by the  registered  holder(s) of
     the shares tendered hereby, no endorsements of certificate(s)  representing
     such shares or separate  stock powers are required  unless payment is to be
     made or the certificates for shares not tendered or not purchased are to be
     issued to a person other than the  registered  holder(s).  SIGNATURE(S)  ON
     SUCH CERTIFICATE(S) MUST BE GUARANTEED BY AN ELIGIBLE INSTITUTION.  If this
     Letter  of  Transmittal  is signed by a person  other  than the  registered
     holder(s)  of the  certificate(s)  listed,  or if  payment is to be made or
     certificates for shares not tendered or not purchased are to be issued to a
     person other than the registered holder(s) thereof, the certificate(s) must
     be endorsed or  accompanied  by  appropriate  stock powers,  in either case
     signed exactly as the name(s) of the registered  holder(s) appear(s) on the
     certificate(s), and the signature(s) on such certificates or stock power(s)
     must be guaranteed by an Eligible Institution. See Instruction 1.

(e)  If this Letter of Transmittal or any  certificate(s)  or stock power(s) are
     signed by a trustee, executor, administrator,  guardian,  attorney-in-fact,
     officer of a  corporation  or any other  person  acting in a  fiduciary  or
     representative  capacity,  such person  should so indicate when signing and
     must submit proper  evidence to the Depositary that is satisfactory to PPLS
     of their authority so to act.

8.   Stock Transfer  Taxes.  Except as provided in this  Instruction 8, no stock
     transfer  tax stamps or funds to cover such stamps need to  accompany  this
     Letter of Transmittal. PPLS will pay or cause to be paid any stock transfer
     taxes  payable on the transfer to it of shares  purchased  under the tender
     offer. However, if:

(a)  payment of the  purchase  price is to be made to any person  other than the
     registered holder(s); or

(b)  certificates  representing tendered shares are registered in the name(s) of
     any person(s) other than the person(s)  signing this Letter of Transmittal;
     or

(c)  shares not tendered or not accepted  for purchase are to be  registered  in
     the name(s) of any person(s) other than the registered holder(s),  then the
     Depositary  will  deduct  from the  purchase  price the amount of any stock
     transfer taxes (whether  imposed on the  registered  holder(s),  such other
     person(s) or otherwise)  payable on account of the transfer to such person,
     unless  satisfactory  evidence of the payment of such taxes or an exemption
     from them is submitted.

9.   Odd Lots. As described in Section 1 of the Offer to Purchase, if PPLS is to
     purchase fewer than all shares  tendered before the expiration date and not
     properly  withdrawn,  the shares purchased first will consist of all shares
     tendered  by any  stockholder  who  owns,  beneficially  or of  record,  an
     aggregate  of fewer than 100 shares and who  tenders  all of such  holder's
     shares  at or  below  the  purchase  price.  This  preference  will  not be
     available  unless all of such holder's  shares are tendered at or below the
     purchase  price.  This  preference  will not be  available  unless  the box
     captioned "Odd Lots" is completed.

10.  Order of Purchase in Event of  Proration.  As described in Section 1 of the
     Offer to  Purchase,  stockholders  may  designate  the order in which their
     shares are to be purchased in the event of proration. The order of purchase
     may have an effect on the federal income tax  classification of any gain or
     loss  on the  shares  purchased.  See  Sections  1 and 14 of the  Offer  to
     Purchase.

11.  Special Payment and Delivery Instructions. If certificate(s) for shares not
     tendered or not purchased and/or check(s) are to be issued in the name of a
     person  other  than the  signer of this  Letter of  Transmittal  or if such
     certificates  and/or  check(s)  are to be sent to  someone  other  than the
     person  signing this Letter of  Transmittal or to the signer at a different
     address,  the box captioned "Special Payment  Instructions"  and/or the box
     captioned  "Special  Delivery  Instructions"  on this Letter of Transmittal
     should be completed as  applicable  and  signatures  must be  guaranteed as
     described in Instructions 1 and 7.

12.  Irregularities.  All  questions  as to the number of shares to be accepted,
     the  price  to be  paid  therefor  and  the  validity,  form,  eligibility,
     including  time of  receipt,  and  acceptance  for payment of any tender of
     shares  will  be  determined  by  PPLS  in  its  sole   discretion,   which
     determinations shall be final and binding on all parties. PPLS reserves the
     absolute  right to reject any or all tenders of shares it determines not be
     in proper form or the  acceptance of which or payment for which may, in the
     opinion of PPLS,  be unlawful.  PPLS also  reserves  the absolute  right to
     waive  any  of the  conditions  of the  tender  offer  and  any  defect  or
     irregularity  in the  tender of any  particular  shares  or any  particular
     stockholder,  and PPLS's  interpretation  of the terms of the tender offer,
     including these instructions,  will be final and binding on all parties. In
     the event a condition is waived with respect to any particular stockholder,
     the same  condition  will be waived with  respect to all  stockholders.  No
     tender of shares will be deemed to be  properly  made until all defects and
     irregularities  have been cured or waived.  Unless  waived,  any defects or
     irregularities in connection with tenders must be cured within such time as
     PPLS shall determine.  None of PPLS, the Depositary,  the Information Agent
     or any other  person is or will be  obligated to give notice of any defects
     or  irregularities in tenders and none of them will incur any liability for
     failure to give any such notice.

13.  Questions and Requests for Assistance and Additional  Copies. Any questions
     or  requests  for  assistance  or for  additional  copies  of the  Offer to
     Purchase, this Letter of Transmittal, the Notice of Guaranteed Delivery and
     other  related  materials may be directed to the  Information  Agent at the
     telephone  number and address set forth on the back cover of this Letter of
     Transmittal.  You may also contact your broker, dealer,  commercial bank or
     trust company for assistance concerning the tender offer.

14.  Tax Identification  Number and Backup  Withholding.  Under the U.S. federal
     income tax backup withholding rules,  unless an exemption applies under the
     applicable  law and  regulations,  28% of the gross  proceeds  payable to a
     stockholder  or other payee  pursuant to the tender  offer must be withheld
     and  remitted  to the U.S.  Internal  Revenue  Service  ("IRS")  unless the
     stockholder  or other payee  provides  its taxpayer  identification  number
     ("TIN") (employer  identification  number or social security number) to the
     Depositary  (as payer) and  certifies  under  penalty of perjury  that such
     number is correct.  Therefore,  each tendering  stockholder should complete
     and  sign  the  Substitute  Form  W-9  included  as part of the  Letter  of
     Transmittal so as to provide the information and certification necessary to
     avoid backup withholding,  unless such stockholder otherwise establishes to
     the  satisfaction  of the  Depositary  that  it is not  subject  to  backup
     withholding.  If the  Depositary  is not provided with the correct TIN, the
     tendering  stockholder also may be subject to penalties imposed by the IRS.
     The  box  in  Part  3 of the  form  should  be  checked  if  the  tendering
     stockholder  has not been issued a TIN and has applied for a TIN or intends
     to apply for a TIN in the near future.  If the box in Part 3 is checked and
     the Depositary is not provided with a TIN prior to payment,  the Depositary
     will  withhold  28% on all such  payments.  If  withholding  results  in an
     overpayment of taxes, a refund may be obtained. Certain "exempt recipients"
     (including,  among others,  certain  Non-United  States Holders (as defined
     below) and some  corporations) are not subject to these backup  withholding
     requirements.  In order for a  Non-United  States  Holder to  qualify as an
     exempt recipient, that stockholder must submit an IRS Form W-8BEN (or other
     applicable IRS Form), signed under penalties of perjury,  attesting to that
     stockholder's  exempt  status.  Such  statement  can be  obtained  from the
     Depositary.

15.  Withholding  on  Non-United  States  Holders.  Even if a Non-United  States
     Holder (as defined below) has provided the required  certification to avoid
     backup  withholding,  the  Depositary  will withhold  United States federal
     income  taxes equal to 30% of the gross  payments  payable to a  Non-United
     States Holder or such holder's agent unless the Depositary  determines that
     a reduced rate of withholding is available pursuant to a tax treaty or that
     an exemption from withholding is applicable because such gross proceeds are
     effectively  connected with the  Non-United  States  Holder's  conduct of a
     trade or business within the United States. For this purpose, a "Non-United
     States Holder" is any stockholder that for United States federal income tax
     purposes  is not (i) a citizen or  resident  of the United  States,  (ii) a
     corporation or partnership created or organized in or under the laws of the
     United States or any State or division  thereof  (including the District of
     Columbia),  (iii) an estate the income of which is subject to United States
     federal income taxation  regardless of the source of such income, or (iv) a
     trust (a) if a court within the United  States is able to exercise  primary
     supervision over the  administration  of the trust and (b) one or more U.S.
     persons have the authority to control all of the  substantial  decisions of
     the trust, or certain trusts considered U.S. persons for federal income tax
     purposes.  In order to obtain a reduced rate of  withholding  pursuant to a
     tax treaty,  a  Non-United  States  Holder must  deliver to the  Depositary
     before the payment a properly  completed  and  executed IRS Form W-8BEN (or
     other   applicable  IRS  Form).  In  order  to  obtain  an  exemption  from
     withholding  on the grounds that the gross  proceeds  paid  pursuant to the
     tender  offer are  effectively  connected  with the  conduct  of a trade or
     business within the United States, a Non-United  States Holder must deliver
     to the  Depositary a properly  completed and executed IRS Form W-8ECI.  The
     Depositary  will determine a  stockholder's  status as a Non-United  States
     Holder  and  eligibility  for a  reduced  rate of,  or an  exemption  from,
     withholding  by  reference  to  outstanding   certificates   or  statements
     concerning   eligibility   for  a  reduced  rate  of,  or  exemption  from,
     withholding  (e.g.,  IRS Form W-8BEN or IRS Form  W-8ECI)  unless facts and
     circumstances  indicate that such reliance is not  warranted.  A Non-United
     States Holder may be eligible to obtain a refund of all or a portion of any
     tax withheld if such  Non-United  States Holder meets those tests described
     in Section 14 of the Offer to Purchase that would characterize the exchange
     as a sale (as opposed to a dividend) or is otherwise able to establish that
     no tax or a reduced amount of tax is due.

NON-UNITED STATES HOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS  REGARDING
THE  APPLICATION  OF UNITED STATES  FEDERAL  INCOME TAX  WITHHOLDING,  INCLUDING
ELIGIBILITY  FOR A  WITHHOLDING  TAX  REDUCTION  OR  EXEMPTION,  AND THE  REFUND
PROCEDURE.

16.  Lost,  Stolen,  Destroyed or Mutilated  Certificates.  If you are unable to
     locate the Certificate(s)  representing your shares, contact the Depositary
     at (800)  884-4225.  The Depositary  will instruct you on the procedures to
     follow.  This should  occur  promptly so that you can timely  deliver  your
     Letter of Transmittal and the required Certificate(s) to the Depositary.

17.  The PPLS Employee Stock  Ownership and Thrift Plan and Trust.  Participants
     in the PPLS Employee Stock Ownership Plan and Trust may not use this Letter
     of  Transmittal  to direct the tender of shares held in their account under
     the  plan.  Participants  are  urged  to  carefully  read  the  "Letter  to
     Participants  in the PPLS Employee Stock  Ownership Plan and Trust" sent to
     them.

18.  The PPLS  Associate  Investment  Club.  Participants  in the PPLS Associate
     Investment Club may not use this Letter of Transmittal to direct the tender
     of shares  held in their  account  in the club.  Participants  are urged to
     carefully read the "Letter to Participants in the PPLS Associate Investment
     Club" sent to them.



IMPORTANT:  THIS LETTER OF  TRANSMITTAL  OR A MANUALLY  SIGNED  PHOTOCOPY  OF IT
(TOGETHER WITH  CERTIFICATE(S) FOR SHARES OR CONFIRMATION OF BOOK-ENTRY TRANSFER
AND ALL OTHER REQUIRED  DOCUMENTS)  OR, IF APPLICABLE,  THE NOTICE OF GUARANTEED
DELIVERY  MUST BE RECEIVED  BY THE  DEPOSITARY  BEFORE 5:00 P.M.,  NEW YORK CITY
TIME, ON THE EXPIRATION DATE.




                            IMPORTANT TAX INFORMATION


Under the  Federal  income  tax law, a  stockholder  whose  tendered  Shares are
accepted  for payment is required  by law to provide the  Depositary  (as payer)
with such  stockholder's  correct  TIN on  Substitute  Form W-9  below.  If such
stockholder  is an individual,  the TIN is such  stockholder's  social  security
number.  If the Depositary is not provided with the correct TIN, the stockholder
may be subject to a $50  penalty  imposed by the  Internal  Revenue  Service and
payments  that are made to such  stockholder  with  respect to Shares  purchased
pursuant to the tender offer may be subject to backup withholding of 28%.

Certain stockholders  including,  among others, certain corporations and certain
foreign  individuals,  are not subject to these backup withholding and reporting
requirements.  In order for a Non-United  States  Holder to qualify as an exempt
recipient,  such  stockholder  must submit an appropriate Form W-8, signed under
penalties  of  perjury,  attesting  to such  stockholder's  exempt  status.  The
appropriate  Form W-8 can be obtained from the Depositary.  Exempt  stockholders
should furnish their TIN, write "Exempt" on the face of the Substitute Form W-9,
and  sign,  date and  return  the  Substitute  Form W-9 to the  Deputy.  See the
accompanying  Guidelines for Certification of Taxpayer  Identification Number on
Substitute Form W-9 for additional  instructions.  A stockholder  should consult
his or her tax advisor as to such  stockholder's  qualification for an exemption
from backup withholding and the procedure for obtaining such exemption.

If backup withholding applies, the Depositary is required to withhold 28% of any
payments made to the stockholder.  Backup  withholding is not an additional tax.
Rather,   the  Federal  income  tax  liability  of  persons  subject  to  backup
withholding  will be  reduced  by the  amount of tax  withheld.  If  withholding
results in an  overpayment  of taxes, a refund may be obtained from the Internal
Revenue Service.

PURPOSE OF SUBSTITUTE FORM W-9

To prevent backup  withholding  on payments that are made to a stockholder  with
respect to Shares  purchased  pursuant to the tender offer,  the  stockholder is
required  to  notify  the  Depositary  of  such  stockholder's  correct  TIN  by
completing  the form below  certifying  that (a) the TIN provided on  Substitute
Form W-9 is correct  (or that such  stockholder  is awaiting a TIN) and (b) that
(i) such  stockholder has not been notified by the Internal Revenue Service that
such  stockholder  is subject to backup  withholding as a result of a failure to
report all  interest  or  dividends  or (ii) the  Internal  Revenue  Service has
notified such  stockholder  that such stockholder is no longer subject to backup
withholding.

WHAT NUMBER TO GIVE THE DEPOSITARY

The stockholder is required to give the Depositary the social security number or
employer  identification  number of the  record  holder of the  Shares  tendered
hereby.  If the  Shares  are in more than one name or are not in the name of the
actual owner, consult the accompanying  Guidelines for Certification of Taxpayer
Identification  Number on Substitute  Form W-9 for additional  guidance on which
number to report. If the tendering stockholder has not been issued a TIN and has
applied  for a number or intends to apply for a number in the near  future,  the
stockholder should write "Applied For" in the space provided for the TIN in Part
I, and sign and date the  Substitute  Form W-9 and the  Certificate  of Awaiting
Taxpayer  Identification  Number.  If "Applied For" is written in Part I and the
Depositary  is not provided with a TIN by the time for payment,  the  Depositary
will withhold 28% of all payments of the purchase price to such stockholder.









               ALL TENDERING HOLDERS MUST COMPLETE THE FOLLOWING:

-------------------------------------------------------------------------------------------------- -------------------
                                                          PAYOR'S NAME:
                                                          UMB BANK N.A.
                               
SUBSTITUTE FORM W-9             PART 1 - PLEASE PROVIDE YOUR TIN IN THE BOX AT THE RIGHT AND        Social Security
Department of the Treasury      CERTIFY BY SIGNING AND DATING BELOW:                                   Number OR
Internal Revenue Service                                                                                Employer
                                                                                                     Identification
PAYOR'S REQUEST FOR TAXPAYER    Name:_____________________________________________                      Number:
IDENTIFICATION NUMBER ("TIN")
                                Address:____________________________________________                 ______________

                                City, State, Zip Code:__________________________________
                                ------------------------------------------------------------------ -------------------
                                ------------------------------------------------------------------ -------------------
                                PART 2 - CERTIFICATION                                             For Payees exempt
                                Under penalties of perjury, I certify that:                        from back-up
                                (1) The number shown on this form is my correct TIN(or I am        withholding,
                                waiting for a number to be issued to me);                          check the Exempt
                                (2) I am not subject to backup withholding because:  (a)  am       box below:
                                exempt from backup withholding, or (b) I have not been notified
                                by the Internal Revenue Service (the "IRS") that I am subject to   [  ] Exempt
                                backup withholding as a result of a failure to report all
                                interest on dividends, or (c) the IRS has notified me that I am
                                no longer subject to backup withholding; and
                                (3) I am a U.S. person (including a U.S. resident alien).
                                CERTIFICATION INSTRUCTIONS-- You must cross out item (2) above
                                if you have been notified by the IRS that you are currently
                                subject to backup withholding because you have failed to report
                                all interest and dividends on your tax return. However, if after
                                being notified by the IRS that you were subject to backup
                                withholding, you received another notification from the IRS that
                                you were no longer subject to backup withholding, do not cross
                                out item (2).  (Also see the instructions in the enclosed
                                guidelines.)  The IRS does not require your consent to any
                                provision of this document other than the certifications
                                required to avoid backup withholding.
                                Signature:__________________________________________               Date:__________
------------------------------- ------------------------------------------------------------------ -------------------


NOTE:  FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 28% OF ANY  PAYMENTS  MADE TO YOU PURSUANT TO THIS OFFER.  PLEASE  REVIEW THE
ENCLOSED  GUIDELINES  FOR  CERTIFICATION  OF TAXPAYER  IDENTIFICATION  NUMBER ON
SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.

YOU MUST COMPLETE THE FOLLOWING  CERTIFICATION IF YOU ARE AWAITING (OR WILL SOON
APPLY FOR) A TAXPAYER IDENTIFICATION NUMBER.

             CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER


I certify under penalties of perjury that a taxpayer  identification  number has
not been issued to me and either (a) I have mailed or delivered  an  application
to receive a taxpayer  identification number to the appropriate Internal Revenue
Service Center or Social Security  Administration Office or (b) I intend to mail
or deliver an application in the near future. I understand that, notwithstanding
the  information I provided in Part I of the  Substitute  Form W-9 (and the fact
that I have  completed  this  Certificate  of Awaiting  Taxpayer  Identification
Number),  if I do not provide a correct  taxpayer  identification  number to the
Depositary  by the time of payment,  28% of all  reportable  payments made to me
thereafter will be withheld until I provide a number.

Signature: ____________________________  Date: ___________




             GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
                          NUMBER ON SUBSTITUTE FORM W-9


Guidelines for determining the proper identification number to give the Payer.

Social  Security  numbers  have  nine  digits  separated  by two  hyphens:  i.e.
000-00-0000.  Employer identification numbers have nine digits separated by only
one hyphen: i.e.  00-0000000.  The table below will help determine the number to
give the payer.

Purpose of Form

A person who is required to file an information return with IRS must obtain your
correct taxpayer  identification number (TIN) to report income paid to you, real
estate transactions,  mortgage interest you paid,  acquisition or abandonment of
secured  property,  cancellation of debt, or  contributions  you made to an IRA.
U.S.  person.  Use Form W-9 only if you are a U.S. person  (including a resident
alien),  to provide your correct TIN to the person requesting it (the requester)
and, when applicable, to:

1.   Certify  the TIN you are giving is correct (or you are waiting for a number
     to be issued),

2.   Certify you are not subject to backup withholding, or

3.   Claim  exemption from backup  withholding  if you are a U.S.  exempt payee.
     Foreign person.  If you are a foreign person,  use the appropriate Form W-8
     (see  Pub.  515,  Withholding  of Tax on  Nonresident  Aliens  and  Foreign
     Entities).  Nonresident alien who becomes a resident alien. Generally, only
     a nonresident  alien individual may use the terms of a tax treaty to reduce
     or  eliminate  U.S.  tax on  certain  types of  income.  However,  most tax
     treaties  contain  a  provision  known  as a  "saving  clause."  Exceptions
     specified in the saving clause may permit an exemption from tax to continue
     for certain types of income even after the recipient has otherwise become a
     U.S. resident alien for tax purposes.  If you are a U.S. resident alien who
     is relying on an exception  contained in the saving  clause of a tax treaty
     to claim an exemption  from U.S. tax on certain  types of income,  you must
     attach a statement that specifies the following five items:

     1.   The treaty  country.  Generally,  this must be the same  treaty  under
          which you claimed exemption from tax as a nonresident alien.

     2.   The treaty article addressing the income.

     3.   The article  number (or  location) in the tax treaty that contains the
          saving clause and its exceptions.

     4.   The type and amount of income that  qualifies for the  exemption  from
          tax.

     5.   Sufficient  facts to justify the exemption from tax under the terms of
          the treaty article.


If you are a  nonresident  alien or a  foreign  entity  not  subject  to  backup
withholding, give the requester the appropriate completed Form W-8.

What is Backup  Withholding?  Persons making certain  payments to you must under
certain  conditions  withhold and pay to the IRS 28% of such  payments.  This is
called "backup withholding."  Payments that may be subject to backup withholding
include interest,  dividends,  broker and barter exchange  transactions,  rents,
royalties,  nonemployee  pay, and certain  payments from fishing boat operators.
Real estate transactions are not subject to backup withholding.

You will not be subject to backup  withholding  on  payments  you receive if you
give the requester your correct TIN, make the proper certifications,  and report
all your taxable interest and dividends on your tax return. Payments you receive
will be subject to backup withholding if:

1. You do not furnish your TIN to the requester, or

2. You do not certify your TIN when required (see the Part II instructions below
for details), or

3. The IRS tells the requester that you furnished an incorrect TIN, or

4. The IRS tells you that you are subject to backup withholding  because you did
not report all your  interest and  dividends on your tax return (for  reportable
interest and dividends only), or

5. You do not  certify  to the  requester  that you are not  subject  to  backup
withholding under 4 above (for reportable  interest and dividend accounts opened
after  1983  only).   Certain   payees  and  payments  are  exempt  from  backup
withholding. See the instructions below.


Penalties

Failure  to  Furnish  your TIN.  If you fail to furnish  your  correct  TIN to a
requester, you are subject to a penalty of $50 for each such failure unless your
failure is due to reasonable cause and not to willful neglect.

Civil Penalty for False  Information With Respect to Withholding.  If you make a
false statement with no reasonable basis that results in no backup  withholding,
you are subject to a penalty of $500.

Criminal Penalty for Falsifying Information. Willfully falsifying certifications
or  affirmations  may subject you to criminal  penalties  including fines and/or
imprisonment.

Misuse of TINs. If the requester  discloses or uses TINs in violation of Federal
law, the requester may be subject to civil and criminal penalties.

Exempt From Backup Withholding

Generally,  individuals  (including sole proprietors) are not exempt from backup
withholding.  Corporations  are  exempt  from  backup  withholding  for  certain
payments, such as interest and dividends.

Exempt  payees.  Backup  withholding is not required on any payments made to the
following payees:

1.   An  organization  exempt  from  tax  under  section  501(a),  any  IRA or a
     custodial  account  under  section  403(b)(7) if the account  satisfies the
     requirements of section 401(f)(2);

2.   The United States or any of its agencies or instrumentalities;

3.   A state,  the District of Columbia,  a possession of the United States,  or
     any of their political subdivisions or instrumentalities;

4.   A foreign  government or any of its political  subdivisions,  agencies,  or
     instrumentalities; or

5.   An international  organization or any of its agencies or instrumentalities.
     Other payees that may be exempt from backup withholding include:

6.   A corporation;

7.   A foreign central bank of issue;

8.   A dealer in  securities or  commodities  required to register in the United
     States, the District of Columbia, or a possession of the United States;

9.   A futures commission merchant registered with the Commodity Futures Trading
     Commission;

10.  A real estate investment trust;

11.  An entity  registered at all times during the tax year under the Investment
     Company Act of 1940;

12.  A common trust fund operated by a bank under section 584(a);

13.  A financial institution;

14.  A middleman known in the investment community as a nominee or custodian; or

15.  A trust exempt from tax under section 664 or described in section 4947.

The  chart  below  shows  types of  payments  that  may be  exempt  from  backup
withholding.  The chart applies to the exempt recipients listed above, 1 through



                                                         
IF the payment is for:                                       THEN the payment is exempt for:

Interest and dividend                                        All exempt payments recipients except for 9

Broker transactions                                          Exempt recipients 1 through 13.  Also, a person
                                                             registered under the Investment Advisers Act of 1940
                                                             who regularly acts as a broker

Barter exchange transactions and patronage dividends         Exempt recipients 1 through 5

Payments over $600 required to be reported and direct        Generally, exempt recipients 1 through 7 (2)
sales over $5,000 (1)


1.   See Form 1099-MISC. Miscellaneous Income, and its instructions.

2.   However,  the following  payments made to a  corporation  (including  gross
     proceeds paid to an attorney under section 6045(f), even if the attorney is
     a corporation)  and reportable on Form 1099-MISC are not exempt from backup
     withholding:  medical  and  health  care  payments;  attorneys'  fees;  and
     payments for services paid by a Federal executive agency.





                  Part I. Taxpayer Identification Number (TIN)


Enter your TIN in the  appropriate  box. If you are a resident  alien and you do
not have and are not  eligible  to get an SSN,  your TIN is your IRS  individual
taxpayer  identification  number (ITIN).  Enter it in the social security number
box.  If you do not have an ITIN,  see How To Obtain a TIN  below.  If you are a
sole  proprietor  and you have an EIN,  you may  enter  either  your SSN or EIN.
However, the IRS prefers that you use your SSN.

If you are a single-owner LLC that is disregarded as an entity separate from its
owner,  enter your SSN (or EIN, if you have one).  If the LLC is a  corporation,
partnership, etc., enter the entity's EIN.

How To Obtain a TIN.  If you do not have a TIN,  apply for one  immediately.  To
apply for an SSN, get Form SS-5,  Application  for a Social  Security Card, from
your local  Social  Security  Administration  office or get this form on-line at
www.ssa.gov/online/ss5.html.   You  may   also   get   this   form  by   calling
1-800-772-1213.   Use  Form  W-7,   Application  for  IRS  Individual   Taxpayer
Identification  Number,  to apply for an ITIN,  or Form  SS-4,  Application  for
Employer  Identification  Number, to apply for an EIN. You can get Forms W-7 and
SS-4 from the IRS by calling 1-800-TAX-FORM (1-800-829-3676) or from the IRS Web
Site at www.irs.gov.

If you are asked to complete Form W-9 but do not have a TIN, write "Applied For"
in the space for the TIN, sign and date the form,  and give it to the requester.
For interest and dividend  payments,  and certain  payments made with respect to
readily tradable  instruments,  generally you will have 60 days to get a TIN and
give it to the  requester  before  you are  subject  to  backup  withholding  on
payments. The 60-day rule does not apply to other types of payments. You will be
subject to backup withholding on all such payments until you provide your TIN to
the requester.




                             Part II. Certification


To establish to the withholding  agent that you are a U.S.  person,  or resident
alien, sign Form W-9. For a joint account, only the person whose TIN is shown in
Part I should sign. Exempt recipients, see Exempt From Backup Withholding above.



                                              
What Name and Number To Give the Requester

For this type of account:                          Give name and SSN of:

1.   Individual                                    The individual

2. Two or more individuals (joint account)         The actual owner of the account or, if combined funds,
                                                   the first individual on the account (1)

3. Custodian account of a minor (Uniform           The minor (2)
   Gift to Minors Act)

4.a. The usual revocable saving trust (grantor     The grantor-trustee(1)
     is also trustee)

  b. So-called trust account that is not a legal   The actual owner (3)
     or valid trust under state law

5.   Sole proprietorship or single-owner LLC       The owner (3)

For this type of account:                          Give the name and EIN of:

6.   Sole proprietorship or single owner LLC       The owner (3)

7.   A valid trust, estate, or pension trust       Legal entity (4)

8.   Corporate or LLC electing corporate status    The corporation
     on Form 8832

9.   Association, club, religious, charitable,     The organization
     educational, or other tax-exempt organization

10.  Partnership or multi-member LLC               The partnership

11.  A broker or registered nominee                The broker or nominee

12.  Account with the Department of Agriculture    The public entity
     in the name of a public entity (such as a
     state or local government, school district,
     or prison) that receives agricultural program
     payments



(1)  List first and circle the name of the person whose  number you furnish.  If
     only one person on a joint account has an SSN, that person's number must be
     furnished

(2)  Circle the minor's name and furnish the minor's SSN.

(3)  You must show your individual name, but you may also enter your business or
     "DBA" name. You may use either your SSN or EIN (if you have one).

(4)  List  first and  circle  the name of the legal  trust,  estate,  or pension
     trust.  (Do not furnish the TIN of the personal  representative  or trustee
     unless the legal entity itself is not designated in the account title.)





Questions and requests for assistance may be directed to the Information Agent
at its addresses and telephone numbers set forth below. Additional copies of the
Offer to Purchase, this Letter of Transmittal or other related tender offer
materials may be obtained from the Information Agent. Stockholders may also
contact their broker, dealer, commercial bank or trust company or other nominee
for assistance concerning the tender offer.

                 The Information Agent for the Tender Offer is:

                   Georgeson Shareholder Communications, Inc.

                          17 State Street - 10th Floor

                               New York, NY 10004

                      Banks and Brokers Call (212) 440-9800

                    All others call Toll-Free (866) 828-4305






                               EXHIBIT (a)(1)(iii)

               Not Valid Unless Signed by an Eligible Institution

                          PRE-PAID LEGAL SERVICES, INC.

                          Notice of Guaranteed Delivery
                    of Shares of Common Stock Pursuant to an
              Offer to Purchase for Cash up to 1,000,000 Shares of
                   Pre-Paid Legal Services, Inc. Common Stock
                    At a Purchase Price Not Less Than $22.50
                        Nor in Excess of $26.00 Per Share

This form, or a facsimile hereof, must be used to accept the offer if:

1. The  certificates for your shares of common stock, par value $0.01 per share,
of Pre-Paid Legal Services, Inc. are not immediately available; or

2. Time will not permit the Letter of Transmittal  (blue form) or other required
documents to reach the  depositary  before the  expiration  date,  as defined in
Section 1 of the Offer to Purchase dated August 26, 2004 (white booklet); or

3. The procedures for book-entry transfer cannot be completed on a timely basis.

This form or a facsimile of it, signed and properly completed,  may be delivered
by hand,  mail,  telegram or facsimile  transmission  to the  depositary  by the
expiration date of the offer. See "Section 3. Procedure for Tendering Shares" in
the Offer to Purchase.

                                   DEPOSITARY:

                                 UMB BANK, N.A.

                        Facsimile Number: (781) 380-3388
                      Confirm by Telephone: (781) 843-1833

                        By Overnight Delivery or Courier:
                                 Pre-Paid Legal
                                 UMB Bank, N.A.
                              161 Bay Street Drive
                               Braintree, MA 02184

                                    By Mail:
                                 Pre-Paid Legal
                                 UMB Bank, N.A.
                                P. O. Box 859208
                            Braintree, MA 02185-9208






Delivery  of this  instrument  to an address  other  than as set forth  above or
transmission  via  facsimile  to a number  other  than as listed  above does not
constitute a valid delivery.








Ladies and Gentlemen:

The undersigned  hereby tenders to Pre-Paid Legal  Services,  Inc., at the price
per share indicated below, net to the seller in cash, upon the terms and subject
to the conditions set forth in the accompanying Offer to Purchase,  dated August
26, 2004 (white  booklet),  and the related Letter of  Transmittal  (blue form),
which together constitute the "offer," receipt of which is hereby  acknowledged,
the number of shares of common stock, par value $0.01 per share, specified below
pursuant  to the  guaranteed  delivery  procedure  set forth  under  "Section 3.
Procedure for Tendering Shares" in the Offer to Purchase.

Please call the information agent for assistance in completing this form toll
free at (866) 828-4305.



(1)  Shares tendered

      
Number of shares tendered:________________  Certificate Nos. (if available): ______________

[ ] Check box if shares will be surrendered by book-entry transfer.

DTC Account Number:___________________________

Name(s) of Record Holder(s):_____________________________________________________

Address:  _____________________________________________________________________

________________________________________________________________________________

Area Code and Telephone Number:  (____) ____________

Social Security Number:  ____-___-_____ or Employer Identification Number:_________________

Dated:  ___________, 2004


                                                   ----------------------------------------


                                                   ----------------------------------------
                                                                Signatures



(2) Price  (in  dollars)  per share at which  shares  are  being  tendered  (see
Instruction 5 on the Letter of Transmittal)

                               CHECK ONLY ONE BOX
     If more than one box is checked, or if no box is checked, there is no valid
     tender of shares.

         Option 1: Shares Tendered At Price Determined By Dutch Auction

[ ]  I want to maximize the chance  of having  Pre-Paid Legal Services  purchase
     all of the shares I am tendering (subject to the possibility of proration).
     Accordingly,  by checking  this box  instead of one of the price  selection
     boxes below, I hereby tender my shares at the purchase price resulting from
     the Dutch Auction tender process.  I acknowledge that this action will have
     the same effect as if I selected the minimum  price of $22.50 per share and
     could  contribute  to lowering the purchase  price  ultimately  selected by
     Pre-Paid Legal Services.

                                       OR

           Option 2: Shares Tendered At Price Selected By Stockholder

By checking  one of the boxes below  instead of the box above,  I hereby  tender
shares at the price checked. I acknowledge that this action could result in none
of the shares being  purchased if the purchase price for shares is less than the
price  checked.  (Stockholders  who wish to tender shares at more than one price
must complete a separate letter for each price at which shares are tendered.)

[  ] $22.50            [  ] $23.00         [  ] $23.50             [  ] $24.00
[  ] $24.50            [  ] $25.00         [  ] $25.50             [  ] $26.00


(3) Odd lots (see Instruction 9 in the Letter of Transmittal)

This  section  is to be  completed  ONLY if shares are being  tendered  by or on
behalf of a person owning of record or beneficially,  an aggregate of fewer than
100 shares.

The undersigned either (check one box):

[ ] is the record or  beneficial  owner(s),  of an  aggregate  of fewer than 100
shares, all of which are being tendered, or

[ ] is a broker,  dealer,  commercial  bank, trust company or other nominee that
(a) is tendering,  for the beneficial  owner(s) thereof,  shares with respect to
which it is the record owner, and (b) believes,  based upon representations made
to it by each beneficial  owner(s),  that such person is the beneficial owner of
an aggregate of fewer than 100 shares, and is tendering all of the shares.

                 ODD LOT SHARES CANNOT BE CONDITIONALLY TENDERED

(4) Conditional tender (See Section 6 in the Offer to Purchase)

You may condition the tender of your shares upon the purchase by Pre-Paid  Legal
Services of a specified  minimum  number of the shares you  tendered.  Unless at
least the  minimum  number of shares  tendered by you is  purchased  by Pre-Paid
Legal Services,  none of the shares  tendered hereby will be purchased.  You are
urged to  consult  your tax  advisor.  Unless  this  box has been  completed  by
specifying a minimum number of shares, the tender will be deemed unconditional.

[ ] Check here and  complete  the  following  if your tender is  conditional  on
Pre-Paid  Legal  Services  purchasing  all or a minimum  number of your tendered
shares.

Minimum number of shares that must be purchased, if any are purchased:
__________ shares

If, because of proration,  the minimum number of shares  designated  will not be
purchased, Pre-Paid Legal Services may accept conditional tenders by random lot,
if necessary.  However, to be eligible for purchase by random lot, you must have
tendered all of your shares.

[ ] Check here if you are tendering all of the shares you own.

(5) Guarantee of delivery (not to be used for signature guarantee)

The undersigned,  a member firm of a registered national securities  exchange, a
member of the National Association of Securities Dealers,  Inc., or a commercial
bank,  trust  company,  savings  association or credit union having an office or
correspondent  in the United States,  hereby (i) represents that the undersigned
has a net long position in shares in or equivalent securities within the meaning
of Rule 14e-4 promulgated under the Securities Exchange Act of 1934, as amended,
at least  equal to the shares  tendered,  (ii)  represents  that such  tender of
shares   complies  with  Rule  14e-4  and  (iii)   guarantees  that  either  the
certificates  representing  the  shares  tendered  hereby  in  proper  form  for
transfer,  or timely  confirmation of the book-entry transfer of the shares into
the  depositary's  account at The  Depository  Trust  Company,  pursuant  to the
procedures set forth under  "Section 3.  Procedure for Tendering  Shares" in the
Offer to Purchase,  together with a properly  completed and duly executed Letter
of Transmittal,  or facsimile thereof, with any required signature guarantee and
any other documents  required by the Letter of Transmittal,  will be received by
the depositary at one of its addresses set forth above within three NYSE trading
days after the date of execution hereof.

Name of Firm:  _________________________           _____________________________
                                                     (Authorized Signature)

Address:  _____________________________      Name:______________________________

_______________________________________     Title:______________________________
City         State            Zip Code

Area Code and Tel. No.: ________________    Dated:________________________, 2004


            DO NOT SEND STOCK CERTIFICATES WITH THIS FORM. YOUR STOCK
            CERTIFICATES MUST BE SENT WITH THE LETTER OF TRANSMITTAL.





                               EXHIBIT (a)(1)(iv)

                                INSTRUCTION FORM
             FOR SHARES HELD BY BROKERS, DEALERS, COMMERCIAL BANKS,
                       TRUST COMPANIES AND OTHER NOMINEES.

                        Instructions For Tender Of Shares
                        of Pre-Paid Legal Services, Inc.

Please tender to Pre-Paid Legal Services, Inc., on (our) (my) behalf, the number
of  shares  indicated  below,  which  are  beneficially  owned by (us)  (me) and
registered in your name,  upon terms and subject to the conditions  contained in
the Offer to Purchase of Pre-Paid  Legal Services dated August 26, 2004, and the
related Letter of Transmittal, the receipt of both of which is acknowledged.

     (1)  Number of shares tendered

     The undersigned hereby instruct(s) you to tender to Pre-Paid Legal Services
     the  number of shares  indicated  below,  at the price per share  indicated
     below, pursuant to the terms and subject to the conditions of the Offer.

     Aggregate number of shares to be tendered by you for us:___________________
     Shares

     (2)  Price (in dollars) per share at which shares are being  tendered  (see
          Instruction 5 on the Letter of Transmittal)

                               CHECK ONLY ONE BOX

            If more than one box is checked, or if no box is checked,
                      there is no valid tender of shares.

         Option 1: Shares Tendered At Price Determined By Dutch Auction

[ ]  I want  to maximize  the chance of having Pre-Paid Legal Services  purchase
     all of the shares I am tendering (subject to the possibility of proration).
     Accordingly,  by checking  this box  instead of one of the price  selection
     boxes below, I hereby tender my shares at the purchase price resulting from
     the Dutch auction tender process.  I acknowledge that this action will have
     the same effect as if I selected the minimum  price of $22.50 per share and
     could  contribute  to lowering the purchase  price  ultimately  selected by
     Pre-Paid Legal Services.

                                       OR

           Option 2: Shares Tendered At Price Selected By Stockholder

     By  checking  one of the boxes  below  instead of the box  above,  I hereby
     tender shares at the price  checked.  I acknowledge  that this action could
     result in none of the shares  being  purchased  if the  purchase  price for
     shares  is less than the price  checked.  (Stockholders  who wish to tender
     shares at more than one price  must  complete  a  separate  letter for each
     price at which shares are tendered.)


[  ] $22.50            [  ] $23.00         [  ] $23.50             [  ] $24.00
[  ] $24.50            [  ] $25.00         [  ] $25.50             [  ] $26.00



(3) Odd lots (see Instruction 9 on the Letter of Transmittal)

[ ]  Check here  ONLY if  you are the record or beneficial owner of an aggregate
     of fewer than 100 shares, all of which are being tendered.

                 ODD LOT SHARES CANNOT BE CONDITIONALLY TENDERED

(4) Conditional tender (See Section 6 in the Offer to Purchase)

You may condition the tender of your shares upon the purchase by Pre-Paid  Legal
Services of a specified  minimum  number of the shares you  tendered.  Unless at
least the  minimum  number of shares  tendered by you is  purchased  by Pre-Paid
Legal Services,  Inc., none of the shares tendered hereby will be purchased. You
are urged to consult  your tax  advisor.  Unless this box has been  completed by
specifying a minimum number of shares, the tender will be deemed unconditional.

[ ]  Check  here and complete the  following  if your tender is  conditional  on
     Pre-Paid Legal Services purchasing all or a minimum number of your tendered
     shares.

Minimum number of shares that must be purchased, if any are purchased:  ________
shares

If, because of proration,  the minimum number of shares  designated  will not be
purchased, Pre-Paid Legal Services may accept conditional tenders by random lot,
if necessary.  However, to be eligible for purchase by random lot, you must have
tendered all of your shares.

[ ]  Check here if you are tendering all of the shares you own.

The  method  of  delivery  of this  document  is at the  option  and risk of the
tendering  stockholder.  If  delivery  is by mail,  registered  mail with return
receipt requested,  properly insured, is recommended.  In all cases,  sufficient
time should be allowed to assure delivery.

The Board of Directors of Pre-Paid Legal Services has  unanimously  approved the
offer.  Neither  Pre-Paid  Legal  Services nor its Board of Directors,  however,
makes any  recommendation  to any stockholder as to whether to tender all or any
shares.  Directors,  officers and employees of Pre-Paid  Legal  Services who own
shares  may   participate  in  this  offer  on  the  same  basis  as  our  other
stockholders.  Each  stockholder must make his or her own decision as to whether
to tender shares and, if so, how many to tender.

(5)  Signatures


     ___________________________________      __________________________________
     Signature                                Signature


     ___________________________________      __________________________________
     Name (Please Print)                      Name (Please Print)

     Date: _____________________________      Date: ____________________________

                                              Area code and telephone number:
                                              __________________________________

     Address: ___________________________     __________________________________
              City     State   Zip Code       Social Security Number
                                              or Employer Identification Number

          IMPORTANT: STOCKHOLDERS ARE ENCOURAGED TO RETURN A COMPLETED
                SUBSTITUTE FORM W-9 WITH THEIR INSTRUCTION FORM.






                               EXHIBIT (a)(1)(v)

                          PRE-PAID LEGAL SERVICES, INC.
                        Offer to Purchase for Cash up to
                      1,000,000 Shares of Its Common Stock
                   at a Purchase Price Not in Excess of $26.00
                         Nor Less Than $22.50 Per Share

           THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT
              5:00 P.M., NEW YORK CITY TIME, ON SEPTEMBER 28, 2004,
                          UNLESS THE OFFER IS EXTENDED

To  the  Participants  in the  Pre-Paid  Legal  Services,  Inc.  Employee  Stock
Ownership  and Thrift Plan and Trust (the  "Plan") with respect to whom all or a
portion of their Plan  accounts are  invested in common stock of Pre-Paid  Legal
Services, Inc.:

IMPORTANT:  Action on your part is  required.  Please  read this  letter and the
accompanying information and complete the accompanying Direction Form and return
it to Henry & Associates, P.C., Ada, Oklahoma 74820 in the envelope provided.

General

Upon the terms and subject to the conditions set forth in the Offer to Purchase,
dated August 26,  2004,  Pre-Paid  Legal  Services is offering to purchase up to
1,000,000  shares of its common stock,  $.01 par value per share, at a price not
greater  than $26.00 nor less than $22.50 per share,  net to the seller in cash,
without  interest.  This  offer  is  being  extended  to all of  Pre-Paid  Legal
Services' stockholders.  The offer is also being extended to all participants in
the Plan whose accounts are invested in our common stock.




Your account in the Plan  includes an  investment in shares of our common stock.
As a  participant  in the Plan,  you may tender in the offer shares held on your
behalf in your Plan account equal to the sum of:

     1.   the shares held in your elective deferral account in the Plan; plus

     2.   your vested percentage in your company contribution account multiplied
          by the shares held in that  account  (collectively,  both (i) and (ii)
          referred to as the "vested shares").



The maximum  number of shares  that you can tender in the offer  (unless you own
shares outside of the Plan) is the number of vested shares that are held in your
Plan account as of 5:00 P.M., Central time, on July 31, 2004 (the "Determination
Date").  You will not be able to tender shares in excess of the number of vested
shares that are held in your Plan  account on the  Determination  Date,  even if
additional  shares are credited to your Plan account or become  vested after the
Determination  Date. For your information only, the number of vested shares held
in your Plan account on the Determination Date is set forth on the first page of
the Direction Form.

You must follow the  instructions in this letter to instruct Henry & Associates,
P.C. ("Plan  Agent"),  who has been appointed as an agent of the Plan to receive
participants'  directions  and authorize and direct the trustees of the Plan, to
either not  tender or tender on your  behalf  some or all of the shares  held in
your  Plan  account  on  the  Determination   Date.   Failure  to  follow  these
instructions  properly may make you  ineligible to tender any of the shares held
in your Plan account in the offer or may result in shares being  tendered  which
you do not wish to be sold. In accordance with your  instructions,  the trustees
will either not tender or tender shares in your Plan account on your behalf. You
must use the  accompanying  Direction  Form to instruct  the trustee  whether to
tender or not tender.

If you fail to complete  and deliver a Direction  Form,  shares in your  account
will be  tendered  pro rata  based  on the  number  of  shares  tendered  by all
disinterested  participants in the Plan and the number of shares not tendered by
all  disinterested  participants.  Disinterested  participants  are participants
other than executive  officers of the Company.  For example if a total of 10,000
shares are  tendered  by all  disinterested  participants  and a total of 20,000
shares are not tendered by all disinterested participants, if you fail to return
the Direction Form,  one-third  (10,000/30,000)  of the shares allocated to your
account will be tendered.  Such tender will be made at the price  determined  in
the Dutch Auction, as unconditional and described herein, and will have the same
effect as if the shares were tendered at the minimum price.

Henry & Associates P.C. has been appointed by the Trustees of the Plan to be the
Plan Agent to accept  participant  Direction Forms and to advise the trustees of
the Plan of the total  number of Plan  shares to be  tendered.  All  participant
Direction  Forms  will be held in  confidence  by the Plan Agent and will not be
released to the Plan trustees unless and until the tender offer is completed.

Price and Proration

We will  determine the single per share price,  not in excess of $26.00 nor less
than  $22.50 per share,  net to the seller in cash,  that we will pay for shares
validly tendered pursuant to the offer, taking into account the number of shares
so tendered and the prices specified by tendering  stockholders.  We will select
the lowest  purchase  price that will allow us to buy 1,000,000  shares,  or the
lesser  number of shares that are  properly  tendered at prices not in excess of
$26.00 nor less than $22.50 per share.  All shares validly tendered at prices at
or below the  purchase  price and not  withdrawn  on or prior to the  expiration
date, as defined in Section 1 of the Offer to Purchase, will be purchased at the
purchase price, subject to the terms and conditions of the offer,  including the
proration, conditional tender and odd lot provisions. See Sections 1, 2 and 6 of
the Offer to Purchase.

Upon the terms and subject to the conditions of the offer, if, at the expiration
of the offer,  more than 1,000,000  shares are validly  tendered at or below the
purchase price and not withdrawn, we will buy shares:

     1.   first,  from  stockholders  who  owned of record  or  beneficially  an
          aggregate  of fewer  than 100  shares  who  properly  tender all their
          shares at or below the purchase  price,  although as described  below,
          this does not apply to Plan participants;

     2.   second, on a pro rata basis, from all other  stockholders who properly
          tender their shares at prices at or below the purchase  price,  and do
          not withdraw  them prior to the  expiration  of the offer,  other than
          stockholders who tender  conditionally,  and for whom the condition is
          not satisfied; and

     3.   if necessary,  shares conditionally  tendered, for which the condition
          was not  satisfied,  at prices at or below the purchase price selected
          by random lot.

If less than all of your vested  shares are not  purchased,  some of your vested
shares are not tendered or those  tendered are prorated,  those shares sold will
first be allocated to your  Elective  Deferral  Account and any  remaining  sold
shares will be allocated to your Company Contribution Account.

If  any  stockholder  tenders  all of his or her  shares  and  wishes  to  avoid
proration  or to limit the extent to which only a portion of such  shares may be
purchased because of the proration provisions, the stockholder may tender shares
subject to the condition  that a specified  minimum  number of shares or none of
such shares be purchased.  See Sections 1, 2 and 6 of the Offer to Purchase. All
shares not purchased pursuant to the offer,  including shares tendered at prices
greater than the purchase price and shares not purchased because of proration or
because they were conditionally  tendered and not accepted for purchases will be
returned to the tendering  stockholders  at our expense  promptly  following the
expiration date.

Our offer is being made solely upon the terms and subject to the  conditions set
forth in the enclosed  Offer to Purchase and Letter of  Transmittal,  which,  as
amended or supplemented  from time to time,  together  constitute the offer. The
offer is being made to all holders of shares of our common  stock.  The offer is
not being made to, nor will tenders be accepted from or on behalf of, holders of
shares  residing  in any  jurisdiction  in  which  the  making  of the  offer or
acceptance of the offer would not be in compliance  with the securities  laws of
that jurisdiction.

Because  the  terms  and  conditions  of the  Offer to  Purchase  and  Letter of
Transmittal  will govern the tender of shares held in the Plan,  you should read
these documents  carefully  before making any decision  regarding the offer. THE
LETTER OF TRANSMITTAL,  HOWEVER,  IS FURNISHED TO YOU FOR YOUR  INFORMATION ONLY
AND CANNOT BE USED BY YOU TO TENDER  SHARES THAT ARE HELD ON YOUR BEHALF IN YOUR
PLAN ACCOUNT.

Proceeds of Tender Offer; Participant-Directed Investment Options

If you direct the Plan trustees to tender vested shares in your account, and the
shares  are  accepted  for  purchase,  the  tender  proceeds  will be  initially
reinvested in your account in the Plan's current Money Market Fund.

Plan design changes will be implemented in the very near future  (anticipated to
be no later than January 1, 2005) to permit  investment  diversification  of any
amounts  then in the Money Market Fund and the  existing  diversified  accounts,
including  the  proceeds  of the tender  offer and up to 25% of future  employee
elective deferrals.

This participant-directed investment diversification will be available in mutual
funds and a stable value fund.  The trustees have selected The 401(k) Company to
provide these investment  options as well as participant  record keeping for all
the Plan assets.  It is anticipated that five American Funds Group mutual funds,
two Vanguard  Index mutual funds and the SEI Stable Value fund will comprise the
new eight  investment  options  initially  available for  participant-direction.
Shares in all eight  options would be purchased at net asset value (NAV) without
sales charges.  Annual expense ratios are well below the industry  average ratio
for  each  fund's  peer  group.  All  funds  will  provide  broadly  diversified
portfolios of securities,  e.g., guaranteed investment contracts (GIC's), bonds,
common  stocks,  within  the  asset  class or  classes  intended  as the  fund's
investment  objective.  All  income  and loss  attributable  to a  participant's
directed  investments will be reflected in that participant's  accounts.  If you
provide specific  investment  direction of your Plan accounts,  neither the Plan
trustees, the Plan's administrative  committee, the Company, The 401(k) Company,
nor any officer,  director or employee of any of these,  will be  responsible or
liable in any  manner  for the  portion  of your  accounts  which  are  invested
pursuant to your instructions.  The following table indicates the name, assigned
asset class and investment objective of the eight new investment options that we
anticipate will initially be available for participant-direction:

________________________________________________________________________________
    Name              Asset Class       Investment Objective
________________________________________________________________________________
SEI Stable Value      Cash           Consistent  positive  return   from   GIC's
Fund                                 (currently rated  AAA)  with   intermediate
                                     term interest  rates;  permits  participant
                                     directed withdrawals at book value.
________________________________________________________________________________
Bond Fund of          Fixed Income   Current  income   with  limited  volatility
America               General-       of  principal;   U.S.  General-Intermediate
                      Intermediate   Treasury, U.S. Government  Agency  and  cor
                      Term           porate bonds  with  three  Term  to  seven
                                     years duration.
________________________________________________________________________________
American Balanced     Balance of     Total return through combination of current
Fund                  U.S. Fixed     income and  capital  growth;  approximately
                                     60% U.S.   equities   with  balance in U.S.
                                     bonds.
________________________________________________________________________________
Washington            Equity Large   Capital  appreciation  in  large  companies
Mutual Investors      Cap Value      with market capitalization of  $10  billion
                                     or more; appear to be undervalued  in terms
                                     of  price-earnings ratios, price-book value
                                     ratios and dividend yields.
________________________________________________________________________________
Growth Fund of        Equity Large   Capital appreciation  in  large   companies
America               Cap Growth     with market capitalization  of  $10 billion
                                     or more;  appear to  have  superior  growth
                                     potential  in terms of earnings per  share,
                                     sales per share and return on equity.
________________________________________________________________________________
Vanguard Small        Equity Small   Capital appreciation  in  smaller companies
Cap Value Index       Cap Value      with  market  Index  capitalization  of  $3
                                     billion or less; appear to  be  undervalued
                                     in terms of  price-earning  ratios,  price-
                                     book  value  ratios  and  dividend  yields;
                                     currently tracking Morgan  Stanley  Capital
                                     International (MSCI ) U.S.  Small Cap Value
                                     index
________________________________________________________________________________
Vanguard Small        Equity Small   Capital appreciation in  smaller  companies
Cap Growth Index      Cap Growth     with marke t Index Growth capitalization of
                                     $3 billion or less; appear to have superior
                                     growth potential in  terms  of earnings per
                                     share,  sales  per  share  and  return   on
                                     equity; currently tracking MSCI  U.S. Small
                                     Cap Growth index.
________________________________________________________________________________
EuroPacific Growth    Equity         Long-term capital growth by  investing   in
                      International  companies   domiciled  outside  the U.S.A.,
                                     primarily in developed countries  but  also
                                     including  some  developing  and   emerging
                                     market countries
________________________________________________________________________________



This is not intended to be a complete  description  of each  investment  option.
Additional information concerning these options,  including the risks associated
with  each  option,  and  information  about  how Plan  participants  will  make
investment  elections will be provided at a later date.  After these changes are
made, participants will be able to change their investment elections on at least
a quarterly basis.

The changes in the Plan will not affect future  contributions  of Pre-Paid Legal
Services and 75% of future  participants'elective  deferrals which will continue
to be required by the terms of the Plan to be invested in company common stock.

Direction Form

To direct  the Plan  trustees  to tender or not  tender any or all of the shares
held on your  behalf  in your  Plan  account,  you must  complete  the  enclosed
Direction  Form and return it to the Plan Agent in the  enclosed  self-addressed
envelope to:


                  Henry & Associates, P.C.
                  124 East Main Street
                  Ada, Oklahoma  74820
                  (580) 310-0784

If you have any questions  concerning  the offer or the tender of shares held in
your Plan  account,  please  contact  Gena Vogt at  Pre-Paid  by  calling  (580)
436-7443 or Georgeson  Shareholder  Communications,  Inc., the information agent
for the offer, toll-free at (866) 828-4305.

Certain Considerations

When  considering  whether or not to participate  in the offer,  it is important
that you note the following:

1.   We have been advised that if the Plan Agent has not received your Direction
     Form at least two (2) business days before the expiration of the offer, the
     trustees  will  tender  shares  held on your behalf in the Plan as outlined
     above.  The offer,  proration  period and withdrawal  rights will expire at
     5:00 P.M.,  New York City time, on September 28, 2004,  unless the offer is
     extended.  Consequently,  your  Direction Form must be received by the Plan
     Agent no later than 5:00 P.M., Central time, on September 24, 2004 to allow
     sufficient time to process the instructions of participants.

2.   Vested  shares  held in your Plan  account  may be  tendered  at prices not
     greater  than  $26.00  nor less  than  $22.50  per  share,  subject  to the
     price-based repurchase limitations of the Plan discussed below.

3.   The Plan is prohibited  from selling  shares to us for a price that is less
     than the  prevailing  market  price.  Accordingly,  if you  elect to tender
     vested  shares  held in your  account  at a price  that is  lower  than the
     closing  sale  price  of  shares  on the New  York  Stock  Exchange  on the
     expiration date of the offer,  the tender price you elect will be deemed to
     have been  increased to the closest tender price that is not less than that
     closing price. This may result in such vested shares not being eligible for
     purchase.

4.   Our Board of  Directors  has  approved  the making of the  offer.  However,
     neither  Pre-Paid  Legal  Services nor our Board of Directors  nor the Plan
     trustees  or the  information  agent is  making  any  recommendation  as to
     whether you should  instruct  the Plan  trustees to tender or refrain  from
     tendering  vested shares held in your account or at what purchase price you
     should choose to tender these shares held in your account.  You must review
     the Offer to  Purchase  and make your own  decision as to whether to direct
     the  trustees to tender the vested  shares held in your account and, if so,
     how many  vested  shares  to  tender  and the  price or prices at which the
     trustees will tender them.

5.   Your  tender  instructions  on the  Direction  Form  will be held in strict
     confidence  by the Plan  Agent  and will not be  divulged  or  released  to
     directors, officers or employees of Pre-Paid Legal Services, other than the
     Plan  trustees or members of the Plan's  administrative  committee and then
     only after  completion of the tender offer and except as may be required by
     law. If the tender offer is not  completed  for any reason,  the Plan Agent
     will not  disclose  the  participants'  Direction  Forms  to any  officers,
     directors or employees of Pre-Paid Legal Services unless required by law.

6.   As more fully  described in the Offer to  Purchase,  tenders will be deemed
     irrevocable unless timely withdrawn. If you deliver a Direction Form to the
     tender some or all of the vested shares held in your Plan account,  and you
     subsequently   decide  to  change  your   instructions   or  withdraw  your
     instruction, you may do so by submitting a new Direction Form. However, the
     new  Direction  Form will be  effective  only if it is received by the Plan
     Agent on or before 5:00 P.M.,  Central time, on September 24, 2004, two (2)
     business days before the expiration of the offer. The offer is scheduled to
     expire at 5:00 P.M., New York City time, on September 28, 2004,  subject to
     extension.  Upon receipt of a timely  submitted  new Direction  Form,  your
     previous instructions to tender the vested shares held in your Plan account
     will be deemed canceled. If you send a new Direction Form to the Plan Agent
     at the address  noted above to withdraw from tender the shares held in your
     Plan account,  you may later re-tender  those shares by submitting  another
     Direction  Form at the above  address so long as it is received by the Plan
     Agent at least two (2) business  days before the  expiration  of the offer.
     Additional  Direction Forms may be obtained from Gena Vogt  580-436-7443 at
     our  offices  or by  contacting  the  Plan  Agent  at the  above-referenced
     telephone number or address.

7.   If you submit a Direction  Form  electing  not to tender all of your vested
     shares held in your account, and you change your mind, you may submit a new
     Direction Form with new  instructions to the Plan Agent.  However,  the new
     Direction  Form will be effective  only if received by the Plan Agent prior
     to 5:00 p.m., Central time on September 24, 2004 as described above.

8.   If you want to  participate in the offer and wish to maximize the chance of
     having  Pre-Paid Legal  Services  accept for purchase all the vested shares
     held in your Plan account which you are tendering, you should check the box
     marked  "Shares  Tendered  at Price  Determined  by Dutch  Auction"  in the
     attached  Direction  Form and complete the other  portions as  appropriate.
     Doing so will  result in you  receiving  a price per share that could be as
     low as $22.50 or as high as $26.00,  subject to the price-based  repurchase
     limitations of the Plan discussed above and will have the same effect as if
     you had selected the minimum price of $22.50 per share.

9.   If you wish to select a specific  price at which you will be tendering your
     vested shares held in your Plan account, you should select one of the boxes
     in the section  captioned "Price (In Dollars) Per Share At Which Shares Are
     Being  Tendered"  in the  attached  Directions  Form and complete the other
     portions as appropriate.

No "Odd Lot" Priority

Participants  in the Plan  may not take  advantage  of the  "odd  lot"  priority
described in Section 1 of the Offer to Purchase. While fewer than 100 shares may
be allocated to a participant's  Plan account,  the record holder of shares held
in  participants'  accounts in the Plan has  significantly  more than 100 shares
and,  therefore,  shares held in the Plan are not eligible to avoid proration by
virtue of the "odd lot" priority.

Conditional Tenders

Under certain  circumstances,  we may prorate the number of shares  purchased in
the offer. A participant in the Plan may tender vested shares held in his or her
Plan account subject to the condition that a specified  minimum number of his or
her shares  tendered must be purchased if any shares tendered are purchased from
the  participant.  If you wish to make a conditional  tender,  you must indicate
this in the box captioned  "Conditional  Tender" in the Direction  Form. In that
box, you must calculate and appropriately  indicate the minimum number of vested
shares  that  must be  purchased  if any are to be  purchased.  After  the offer
expires,  if more than 1,000,000 shares are properly  tendered and not withdrawn
and we must  prorate  acceptance  of and payment for  tendered  shares,  we will
calculate a  preliminary  proration  percentage  based upon all shares  properly
tendered, conditionally or unconditionally,  and not withdrawn. If the effect of
this  preliminary  proration  would be to  reduce  the  number  of  shares to be
purchased  from any  participant  below the  minimum  number  specified  by that
participant, the conditional tender will automatically be regarded as withdrawn,
unless chosen by lot for reinstatement as discussed in Section 6 of the Offer to
Purchase.

Tax Considerations

While participants will not recognize any immediate tax gain or loss as a result
of the  tender  of any  shares,  the tax  treatment  of  future  withdrawals  or
distributions  from the Plan may be  adversely  impacted by a tender and sale of
shares within the Plan. Specifically, under current federal income tax rules, if
you receive a distribution  of shares from the Plan that have increased in value
while they were held by the Plan, under certain  circumstances  (e.g. a lump-sum
distribution of the employee's balance in the ESOP Plan) you may have the option
of not paying tax on this  increase in value,  which is called  "net  unrealized
appreciation,"  until you sell the shares. When the shares are sold, any gain up
to the amount of the untaxed net unrealized  appreciation  is taxed as long-term
capital gain.  Any part of the gain that is more than the untaxed net unrealized
appreciation  may be a short-term or long-term  capital  gain,  depending on the
length of the employee's  holding period before the sale. The employee's holding
period  for  shares  distributed  from  the  ESOP  Plan  will  begin on the date
following the date the ESOP Plan  delivers the stock to the transfer  agent with
instructions to reissue the stock in the employee's  name. If shares credited to
your  individual  account are purchased by Pre-Paid Legal Services in the offer,
you will no longer be able to take advantage of this tax benefit. You also would
not be able to take  advantage of this tax benefit if the shares are rolled over
to an individual retirement account or another eligible employer plan.

--------------------------------------------------------------------------------


IF YOU FAIL TO SUBMIT  DIRECTION FORM TO THE PLAN AGENT SOME OF YOUR SHARES WILL
BE TENDERED AS DESCRIBED ABOVE.

IF YOU SUBMIT A COMPLETED  AND EXECUTED  DIRECTION  FORM  ELECTING TO TENDER THE
VESTED  SHARES HELD IN YOUR  ACCOUNT,  BUT DO NOT  INDICATE THE NUMBER OF VESTED
SHARES  HELD IN YOUR  ACCOUNT  YOU WISH TO  TENDER,  YOU WILL BE  DEEMED TO HAVE
DIRECTED THE TRUSTEES TO TENDER ALL OF YOUR VESTED SHARES, AND THE TRUSTEES WILL
TENDER ALL OF THE SHARES HELD IN YOUR ACCOUNT ON THE DETERMINATION DATE.


--------------------------------------------------------------------------------








                           PRE-PAID LEGAL SERVICE INC.
                                    ESOP PLAN

                                 DIRECTION FORM
                 WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH
                                       BY
                          PRE-PAID LEGAL SERVICES, INC.
                                       FOR
                   UP TO 1,000,000 SHARES OF ITS COMMON STOCK
                              DATED AUGUST 26, 2004

These instructions will authorize the Plan Agent, Henry & Associates,  P.C. , to
instruct the trustees of the Plan to tender a number of vested shares  allocated
to your Plan  account  as  indicated  below  upon the terms and  subject  to the
conditions set forth in the Offer to Purchase.

The maximum  number of shares  that you can tender in the offer  (unless you own
shares outside of the Plan) is the number of vested shares that are held in your
Plan account as of 5:00 P.M. Central time, on July 31, 2004 (the  "Determination
Date").  The number of such shares is set forth  below.  You will not be able to
tender  shares in excess of the  number of vested  shares  that are held in your
Plan account on the  Determination  Date, even if additional shares are credited
to your Plan account after the Determination Date.

You must complete a Direction Form even if you do not wish to tender shares.  If
you fail to complete and deliver a Direction Form, vested shares in your account
will be  tendered  pro rata  based  on the  number  of  shares  tendered  by all
disinterested  participants in the Plan and the number of shares not tendered by
all  disinterested  participants.  Disinterested  participants  are participants
other than executive officers of the Pre-Paid Legal Services.  For example, if a
total of 10,000  shares are  tendered by all  disinterested  participants  and a
total of 20,000 shares are not tendered by all  disinterested  participants,  if
you fail to return the Direction Form,  one-third  (10,000/30,000) of the shares
vested  allocated to your  account will be tendered.  Such tender will be at the
price  determined  at the  Dutch  Auction  and  will  be made  unconditional  as
described in the Letter to Plan participants.

Complete and send this Direction Form in the envelope provided to:

                            Henry & Associates, P.C.
                              124 East Main Street
                               Ada, Oklahoma 74820
                                 (580) 310-0784






The undersigned  acknowledges  receipt of the Letter to the  Participants in the
Pre-Paid Legal Services, Inc. Employee Stock Ownership and Thrift Plan and Trust
(the  "Plan"),  the Offer to Purchase,  dated  August 26, 2004,  and the related
Letter of Transmittal in connection  with the offer by Pre-Paid Legal  Services,
Inc., an Oklahoma corporation,  to purchase up to 1,000,000 shares of its common
stock, $.01 par value per share.



(1)  Tender or Not Tender


The undersigned hereby instructs you:

[ ]  Not to tender any vested shares held in my Plan account

or

[ ]  to  tender  to Pre-Paid  Legal Services the number of vested shares held in
     my Plan account  indicated  below, at the price per share indicated  below,
     pursuant to the terms and subject to the conditions of the Offer.

          [ ] Aggregate number of vested shares to be tendered for me:
                          _______________________shares


(2)  Price (in  dollars)  per share at which  shares  are  being  tendered  (see
     Instruction 5 on the Letter of Transmittal)



    CHECK ONLY ONE BOX AND CHECK ONLY IF YOU ELECTED TO TENDER VESTED SHARES
                            HELD IN YOUR PLAN ACCOUNT
           If more than one box is checked, or if no box is checked,
                       there is no valid tender of shares.

         Option 1: Shares Tendered At Price Determined By Dutch Auction

[ ] I want to maximize the chance of having Pre-Paid Legal Services purchase all
of  the  vested  shares  held  in my  account  I am  tendering  (subject  to the
possibility of proration).  Accordingly,  by checking this box instead of one of
the price  selection boxes below, I hereby direct the Plan trustees to tender my
vested shares held in my account at the purchase price  resulting from the Dutch
Auction  tender  process.  I  acknowledge  that this  action  will  result in me
receiving a price per share that could be as low as $22.50 or as high as $26.00,
has the same  effect as if I  selected  the  minimum  price of $22.50  and could
contribute to lowering the purchase price ultimately  selected by Pre-Paid Legal
Services.





                                       OR



           Option 2: Shares Tendered At Price Selected By Stockholder*



By checking one of the boxes below instead of the box above, I hereby direct the
Trustees to tender vested shares held in my account at the price checked. I
acknowledge that this action could result in none of the shares being purchased
if the purchase price for shares is less than the price checked. (If you wish to
tender vested shares at more than one price, you must complete a separate
Direction Form for each price at which shares are to be tendered.)


[  ] $22.50               [  ] $23.00          [  ] $23.50           [  ] $24.00

[  ] $24.50               [  ] $25.00          [  ] $25.50           [  ] $26.00

* As described  in the letter  delivered to you with this  Direction  Form,  the
price you elect will be  adjusted  to equal the  closing  price of shares on the
expiration date for the offer,  as reported on the New York Stock  Exchange,  if
such closing price is greater than the price you  designated  above,  or, if the
closing price is not an available  option under this offer,  the price you elect
will be adjusted to the next highest  available  price that is not less than the
closing  price on the  expiration  date.  If the  closing  price  for  shares of
Pre-Paid Legal Services on the expiration  date is higher than $26.00 per share,
or, if less,  the purchase  price for shares in this tender  offer,  none of the
shares allocated to your account will be sold.

(3)      Conditional tender (See Section 6 in the Offer to Purchase)

You may condition the tender of your vested shares in your Plan account upon the
purchase by Pre-Paid Legal Services of a specified  minimum number of shares you
tendered. Unless at least the minimum number of vested shares tendered by you is
purchased by Pre-Paid Legal Services, none of the vested shares you direct to be
tendered  hereby  will be  purchased.  Unless  this  box has been  completed  by
specifying a minimum number of shares, the tender will be deemed unconditional.

[ ] Check here and complete the following if your direction is conditional on
Pre-Paid Legal Services purchasing all or a minimum number of the vested shares
in your Plan account.

Minimum number of shares that must be purchased, if any are purchased:
____________ shares

If, because of proration,  the minimum number of shares  designated  will not be
purchased, Pre-Paid Legal Services may accept conditional tenders by random lot,
if necessary.  However, to be eligible for purchase by random lot, you must have
tendered all of the vested shares in your Plan account.

[ ] Check here if you are tendering  all of the vested shares  allocated to your
Plan account on the Determination Date.

(4)      Signature

Dated:                      2004
        -------------------


(SIGNATURE)
             ----------------------------------------------------------

Print Name:
             ----------------------------------------------------------

Social Security Number:
                         -------------------------------------

Address:
          -------------------------------------------------------------

City, State, Zip:
                   ----------------------------------------------------

Phone Number:  (           )
                ----------------------------------------------






                               EXHIBIT (a)(1)(vi)

                          PRE-PAID LEGAL SERVICES, INC.
                        Offer to Purchase for Cash up to
                      1,000,000 Shares of Its Common Stock
                   at a Purchase Price Not in Excess of $26.00
                         Nor Less Than $22.50 Per Share

           THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT
              5:00 P.M., NEW YORK CITY TIME, ON SEPTEMBER 28, 2004,
                          UNLESS THE OFFER IS EXTENDED

To the Participants in the Pre-Paid Legal Service, Inc. Associate Investment
Club ("Investment Club"):

General

Upon the terms and subject to the conditions set forth in the Offer to Purchase,
dated August 26,  2004,  Pre-Paid  Legal  Services is offering to purchase up to
1,000,000  shares of its common stock,  $.01 par value per share, at a price not
greater  than $26.00 nor less than $22.50 per share,  net to the seller in cash,
without  interest.  This  offer  is  being  extended  to all of  Pre-Paid  Legal
Services' stockholders.  The offer is also being extended to all Participants in
the Investment Club whose accounts are invested in our common stock.

Your account in the  Investment  Club  includes an  investment  in shares of our
common stock.  As a participant  in the  Investment  Club, you may tender in the
offer shares held on your behalf in your  Investment  Club account.  The maximum
number of shares that you can tender in the offer (unless you own shares outside
of the Investment Club) is the number of shares that are held in your Investment
Club  account  as  of  5:00  P.M.,   Central  time,  on  August  25,  2004  (the
"Determination  Date").  You will not be able to tender  shares in excess of the
number  of  shares  that  are  held  in  your  Investment  Club  account  on the
Determination  Date,  even if additional  shares are credited to your Investment
Club account  after the  Determination  Date.  For your  information  only,  the
enclosed  Direction Form shows the number of shares held in your Investment Club
account on the Determination Date.

You must follow the  instructions in this letter to instruct the Investment Club
to tender on your behalf some or all of the shares held in your  Investment Club
account on the Determination Date. Failure to follow these instructions properly
may make you ineligible to tender any of the shares held in your Investment Club
account in the offer.  In accordance with your  instructions,  the managers will
tender shares in your Investment  Club account on your behalf.  You must use the
accompanying Direction Form to instruct the Investment Club whether to tender.

If you fail to properly  complete and timely deliver a Direction Form, shares in
your account will not be tendered.

Price and Proration

We will  determine the single per share price,  not in excess of $26.00 nor less
than  $22.50 per share,  net to the seller in cash,  that we will pay for shares
validly tendered pursuant to the offer, taking into account the number of shares
so tendered and the prices specified by tendering  stockholders.  We will select
the lowest  purchase  price that will allow us to buy 1,000,000  shares,  or the
lesser  number of shares that are  properly  tendered at prices not in excess of
$26.00 nor less than $22.50 per share.  All shares validly tendered at prices at
or below the  purchase  price and not  withdrawn  on or prior to the  expiration
date, as defined in Section 1 of the Offer to Purchase, will be purchased at the
purchase price, subject to the terms and conditions of the offer,  including the
proration, conditional tender and odd lot provisions. See Sections 1, 2 and 6 of
the Offer to Purchase.

Upon the terms and subject to the conditions of the offer, if, at the expiration
of the offer,  more than 1,000,000  shares are validly  tendered at or below the
purchase price and not withdrawn, We will buy shares (i) first from stockholders
who owned of record or  beneficially  an  aggregate of fewer than 100 shares who
properly tender all their shares at or below the purchase price, (ii) second, on
a pro rata basis,  from all other  stockholders who properly tender their shares
at prices at or below the purchase price,  and do not withdraw them prior to the
expiration of the offer, other than stockholders who tender  conditionally,  and
for whom  the  condition  is not  satisfied,  and  (iii)  if  necessary,  shares
conditionally  tendered, for which the condition was not satisfied, at prices at
or below the purchase price selected by random lot. If any  stockholder  tenders
all of his or her shares and wishes to avoid proration or to limit the extent to
which only a portion of such shares may be  purchased  because of the  proration
provisions,  the  stockholder  may tender shares subject to the condition that a
specified  minimum  number of shares or none of such  shares be  purchased.  See
Sections 1, 2 and 6 of the Offer to Purchase.  All shares not purchased pursuant
to the offer,  including  shares  tendered at prices  greater  than the purchase
price and  shares  not  purchased  because of  proration  or  because  they were
conditionally  tendered and not accepted for  purchases  will be returned to the
tendering stockholders at our expense promptly following the expiration date.

Our offer is being made solely upon the terms and subject to the  conditions set
forth in the enclosed  Offer to Purchase and Letter of  Transmittal,  which,  as
amended or supplemented  from time to time,  together  constitute the offer. The
offer is being made to all holders of shares of our common  stock.  The offer is
not being made to, nor will tenders be accepted from or on behalf of, holders of
shares  residing  in any  jurisdiction  in  which  the  making  of the  offer or
acceptance of the offer would not be in compliance  with the securities  laws of
that jurisdiction.

Because  the  terms  and  conditions  of the  Offer to  Purchase  and  Letter of
Transmittal  will govern the tender of shares held in the  Investment  Club, you
should read these documents  carefully before making any decision  regarding the
offer.  THE  LETTER  OF  TRANSMITTAL,  HOWEVER,  IS  FURNISHED  TO YOU FOR  YOUR
INFORMATION  ONLY AND  CANNOT BE USED BY YOU TO TENDER  SHARES  THAT ARE HELD ON
YOUR BEHALF IN YOUR INVESTMENT CLUB ACCOUNT.

Proceeds of Tender Offer

If you tender shares,  and your shares are purchased,  the tender  proceeds will
promptly be mailed to you by the Investment Club.

If you tender all of your  shares held on your  behalf by the  Investment  Club,
such sale will not affect any future  purchases  that may be thereafter  made on
your behalf pursuant to any existing authorization you have given the Investment
Club. If you wish to cease further future purchases, you will need to follow the
procedures of the Investment Club for revoking such authority.

Direction Form

To direct the  Investment  Club to tender any or all of the shares  held on your
behalf in your Investment Club account, you must complete the enclosed Direction
Form and return it to the UMB Bank,  who has been  appointed  by the  Company to
tabulate participant directions as included in the Direction Form.

If you have any questions  concerning  the offer or the tender of shares held in
your Investment Club account, please contact Janice Stinson at (580) 436-7406 or
Georgeson Shareholder Communications, Inc., the information agent for the offer,
toll-free at (866) 828-4305.

Certain Considerations

When  considering  whether or not to participate  in the offer,  it is important
that you note the following:

1.   If UMB Bank has not received your  Direction Form at least two (2) business
     days  before the  expiration  of the offer,  the  Investment  Club will not
     tender any shares held on your behalf in the  Investment  Club.  The offer,
     proration  period and withdrawal  rights will expire at 5:00 P.M., New York
     City  time,  on  September   28,  2004,   unless  the  offer  is  extended.
     Consequently,  your  Direction  Form must be  received by UMB Bank no later
     than  5:00  P.M.,  New York  City  time,  on  September  24,  2004 to allow
     sufficient time to process the instructions of Participants.

2.   Shares held in your  Investment  Club account may be tendered at prices not
     greater than $26.00 nor less than $22.50 per share.

3.   Our Board of  Directors  has  approved  the making of the  offer.  However,
     neither  Pre-Paid  Legal  Services  nor  our  Board  of  Directors  nor the
     Investment Club or the information agent is making any recommendation as to
     whether you should tender or refrain from  tendering your shares or at what
     purchase price you should choose to tender your shares.  You must make your
     own  decision  as to whether to tender  your  shares  and,  if so, how many
     shares to tender and the price or prices at which you will tender them.

4.   As more fully  described in the Offer to  Purchase,  tenders will be deemed
     irrevocable  unless timely  withdrawn.  If you deliver a Direction  Form to
     tender some or all of the shares held in your Investment Club account,  and
     you subsequently decide to change your instructions or withdraw your tender
     of shares, you may do so by submitting a new Direction Form.  However,  the
     new Direction Form will be effective only if it is received by the UMB Bank
     on or before 5:00 P.M.,  New York City time, on September 24, 2004, two (2)
     business days before the expiration of the offer. The offer is scheduled to
     expire at 5:00 P.M., New York City time, on September 28, 2004,  subject to
     extension.  Upon receipt of a timely  submitted  new Direction  Form,  your
     previous  instructions to tender the shares will be deemed canceled. If you
     send a new  Direction  Form to UMB Bank to withdraw  from tender the shares
     held  on your  behalf  in  your  Investment  Club  account,  you may  later
     re-tender those shares by submitting  another  Direction Form so long as it
     is  received  by the UMB Bank at least two (2)  business  days  before  the
     expiration of the offer.  Additional  Direction  Forms may be obtained from
     Janice  Stinson  580-436-7406  at our offices or the  information  agent at
     (866) 828-4305.

5.   If you want to  participate in the offer and wish to maximize the chance of
     having  Pre-Paid Legal Services  accept for purchase all the shares you are
     tendering hereby, you should check the box marked "Shares Tendered at Price
     Determined by Dutch  Auction" in the attached  Direction  Form and complete
     the other portions as appropriate.  Doing so will result in you receiving a
     price per  share  that  could be as low as $22.50 or as high as $26.00  and
     will  have the same  effect as if you had  selected  the  minimum  price of
     $22.50 per share.

6.   If you wish to select a specific  price at which you will be tendering your
     shares,  you should select one of the boxes in the section captioned "Price
     (In Dollars) Per Share At Which Shares Are Being  Tendered" in the attached
     Direction Form and complete the other portions as appropriate.

Conditional Tenders

Under certain  circumstances,  we may prorate the number of shares  purchased in
the offer. A participant in the Investment Club may tender shares subject to the
condition that a specified  minimum number of his or her shares tendered must be
purchased if any shares tendered are purchased from the participant. If you wish
to make a  conditional  tender,  you  must  indicate  this in the box  captioned
"Conditional  Tender" in the Direction Form. In that box, you must calculate and
appropriately  indicate  the minimum  number of shares that must be purchased if
any are to be purchased.  After the offer expires, if more than 1,000,000 shares
are properly  tendered and not withdrawn  and we must prorate  acceptance of and
payment  for  tendered  shares,  we  will  calculate  a  preliminary   proration
percentage   based  upon  all  shares  properly   tendered,   conditionally   or
unconditionally,  and not withdrawn. If the effect of this preliminary proration
would be to reduce the  number of shares to be  purchased  from any  participant
below the minimum number specified by that participant,  the conditional  tender
will  automatically  be  regarded  as  withdrawn,   unless  chosen  by  lot  for
reinstatement as discussed in Section 6 of the Offer to Purchase.

IF YOU SUBMIT A COMPLETED  AND EXECUTED  DIRECTION  FORM ELECTING TO TENDER YOUR
SHARES,  BUT DO NOT INDICATE THE NUMBER OF SHARES HELD IN YOUR  INVESTMENT  CLUB
ACCOUNT  YOU WISH TO  TENDER,  YOU WILL BE DEEMED TO HAVE  TENDERED  ALL OF YOUR
SHARES,  AND THE  INVESTMENT  CLUB WILL  TENDER ALL OF THE  SHARES  HELD IN YOUR
INVESTMENT CLUB ACCOUNT ON THE DETERMINATION DATE.




                          PRE-PAID LEGAL SERVICES, INC.
                            ASSOCIATE INVESTMENT CLUB

                                 DIRECTION FORM
                 WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH
                                       BY
                          PRE-PAID LEGAL SERVICES, INC.
                                       FOR
                   UP TO 1,000,000 SHARES OF ITS COMMON STOCK
                              DATED AUGUST 26, 2004

The undersigned  acknowledges  receipt of the Letter to the  Participants in the
Pre-Paid Legal Service,  Inc. Associate Investment Club (the "Investment Club"),
the  Offer to  Purchase,  dated  August  26,  2004,  and the  related  Letter of
Transmittal in connection  with the offer by Pre-Paid Legal  Services,  Inc., an
Oklahoma  corporation,  to purchase up to 1,000,000  shares of its common stock,
$.01 par value per share.

These  instructions  will  authorize the  Investment  Club to tender a number of
shares  allocated to your  Investment  Club account as indicated  below upon the
terms and subject to the conditions set forth in the Offer to Purchase.

The maximum  number of shares  that you can tender in the offer  (unless you own
shares outside of the Investment  Club) is the number of shares that are held in
your  Investment  Club account as of 5:00 P.M.  Central time, on August 25, 2004
(the  "Determination  Date"). You will not be able to tender shares in excess of
the  number of  shares  that are held in your  Investment  Club  account  on the
Determination  Date,  even if additional  shares are credited to your Investment
Club account  after the  Determination  Date.  The number of shares held in your
account on the Determination Date is set forth below.









Complete and send this Direction Form in the Enclosed Envelope to:

          By Mail:                                         By Overnight Courier:
      Pre-Paid Legal                                           Pre-Paid Legal
       c/o UMB Bank                                             c/o UMB Bank
      P. O. Box 859208                                      161 Bay Street Drive
 Brainintree, MA 02185-9208                                  Braintree, MA 02184







If you fail to complete  and deliver a Direction  Form,  shares in your  account
will not be tendered.

(1)  Tender

The undersigned hereby instructs you:
[ ] to tender to Pre-Paid Legal Services the number of shares  indicated  below,
at the price per share indicated below, pursuant to the terms and subject to the
conditions of the Offer.

[  ] Aggregate number of shares to be tendered for me:                   shares
                                                      ------------------

(2)  Price (in  dollars)  per share at which  shares  are  being  tendered  (see
     Instruction 5 on the Letter of Transmittal)

                         CHECK ONLY ONE BOX AND CHECK ONLY IF YOU ELECTED TO
           TENDER SHARES If more than one box is checked, or if no box is
           checked, there is no valid tender of shares.

         Option 1: Shares Tendered At Price Determined By Dutch Auction
[ ] I want to maximize the chance of having Pre-Paid Legal Services purchase all
of the  shares  I am  tendering  (subject  to  the  possibility  of  proration).
Accordingly,  by checking this box instead of one of the price  selection  boxes
below, I hereby tender my shares at the purchase price  resulting from the Dutch
auction  tender  process.  I  acknowledge  that this  action  will  result in me
receiving a price per share that could be as low as $22.50 or as high as $26.00,
has the same  effect as if I  selected  the  minimum  price of $22.50  and could
contribute to lowering the purchase price ultimately  selected by Pre-Paid Legal
Services.

                                       OR

           Option 2: Shares Tendered At Price Selected By Stockholder

By checking  one of the boxes below  instead of the box above,  I hereby  tender
shares at the price checked. I acknowledge that this action could result in none
of the shares being  purchased if the purchase price for shares is less than the
price  checked.  (Stockholders  who wish to tender shares at more than one price
must complete a separate letter for each price at which shares are tendered.)

[  ] $22.50               [  ] $23.00          [  ] $23.50           [  ] $24.00

[  ] $24.50               [  ] $25.00          [  ] $25.50           [  ] $26.00

(3)  Odd lots (see Instruction 9 on Letter of Transmittal)

[ ] Check here ONLY if you are the  beneficial  owner of an  aggregate  of fewer
than 100  shares  in the  Associate  Investment  Club,  all of which  are  being
tendered.

ODD LOT SHARES CANNOT BE CONDITIONALLY TENDERED


(4)  Conditional tender (See Section 6 in the Offer to Purchase)

You may condition the tender of your shares upon the purchase by Pre-Paid  Legal
Services of a specified  minimum  number of the shares you  tendered.  Unless at
least the  minimum  number of shares  tendered by you is  purchased  by Pre-Paid
Legal Services,  none of the shares  tendered  hereby will be purchased.  Unless
this box has been completed by specifying a minimum number of shares, the tender
will be deemed unconditional.

[ ] Check here and  complete  the  following  if your tender is  conditional  on
Pre-Paid  Legal  Services  purchasing  all or a minimum  number of your tendered
shares.

Minimum number of shares that must be purchased, if any are purchased:
____________ shares

If, because of proration,  the minimum number of shares  designated  will not be
purchased, Pre-Paid Legal Services may accept conditional tenders by random lot,
if necessary.  However, to be eligible for purchase by random lot, you must have
tendered all of your shares.

[ ]  Check  here  if you  are  tendering  all of the  shares  allocated  to your
Investment Club account on the Determination Date.

(5)  Signature

Dated:                      2004
        -------------------


(SIGNATURE)
             ---------------------------------------------------------

Print Name:
             ----------------------------------------------------------

Social Security Number:
                         -------------------------------------

Address:
          -------------------------------------------------------------

City, State, Zip:
                   ----------------------------------------------------

Phone Number:  (           )
                ----------------------------------------------







                                EXHIBIT (a)(5)(i)

                          PRE-PAID LEGAL SERVICES, INC.
                        Offer to Purchase for Cash up to
                      1,000,000 Shares of Its Common Stock
                   at a Purchase Price Not in Excess of $26.00
                         Nor Less Than $22.50 Per Share

           THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT
                5:00 P.M., NEW YORK TIME, ON SEPTEMBER 28, 2004,
                          UNLESS THE OFFER IS EXTENDED

To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees:

Pre-Paid Legal Services, Inc., an Oklahoma corporation,  is offering to purchase
for cash up to 1,000,000 shares of its common stock,  $0.01 par value per share.
The offer to  purchase  is being made at prices not in excess of $26.00 nor less
than $22.50 per share, as specified by stockholders tendering their shares, upon
the terms and subject to the conditions set forth in the  accompanying  Offer to
Purchase,  dated August 26, 2004 (white  booklet),  and in the related Letter of
Transmittal (blue form), which together constitute the "offer."

Pre-Paid Legal Services will determine the single per share price, not in excess
of $26.00 nor less than  $22.50 per  share,  net to the seller in cash,  that it
will pay for shares validly tendered pursuant to the offer,  taking into account
the  number  of  shares  so  tendered  and the  prices  specified  by  tendering
stockholders. Pre-Paid Legal Services will select the lowest purchase price that
will allow it to buy 1,000,000  shares,  or the lesser number of shares that are
properly  tendered  at prices not in excess of $26.00  nor less than  $22.50 per
share.  All shares validly tendered at prices at or below the purchase price and
not withdrawn on or prior to the expiration date, as defined in Section 1 of the
Offer to Purchase, will be purchased at the purchase price, subject to the terms
and conditions of the offer, including the proration, conditional tender and odd
lot provisions. See Sections 1,2 and 6 of the Offer to Purchase.

Upon the terms and subject to the conditions of the offer, if, at the expiration
of the offer,  more than 1,000,000  shares are validly  tendered at or below the
purchase  price and not  withdrawn,  Pre-Paid Legal Services will buy shares (i)
first from  stockholders who own of record or beneficially an aggregate of fewer
than 100 shares who  properly  tender all their  shares at or below the purchase
price,  (ii)  second,  on a pro rata  basis,  from all  other  stockholders  who
properly  tender their shares at prices at or below the purchase  price,  and do
not withdraw them prior to the expiration of the offer,  other than stockholders
who tender conditionally, and for whom the condition is not satisfied, and (iii)
if necessary,  shares  conditionally  tendered,  for which the condition was not
satisfied,  at prices at or below the purchase  price selected by random lot. If
any  stockholder  tenders all of his or her shares and wishes to avoid proration
or to limit the extent to which only a portion of such  shares may be  purchased
because of the propration provisions,  the stockholder may tender shares subject
to the  condition  that a  specified  minimum  number  of shares or none of such
shares be  purchased.  See  Sections  1, 2 and 6 of the Offer to  Purchase.  All
shares not purchased pursuant to the offer,  including shares tendered at prices
greater than the purchase price and shares not purchased because of proration or
because they were conditionally  tendered and not accepted for purchases will be
returned to the  tendering  stockholders  at Pre-Paid  Legal  Service's  expense
promptly following the expiration date.

THE OFFER IS NOT  CONDITIONED  ON ANY MINIMUM  NUMBER OF SHARES  BEING  TENDERED
PURSUANT TO THE OFFER. SEE SECTION 7 OF THE OFFER TO PURCHASE.

No fees or  commissions  will be payable to  brokers,  dealers or any person for
soliciting  tenders of shares  pursuant to the offer.  Pre-Paid  Legal  Services
will,  upon request,  reimburse  brokers and banks for  reasonable and customary
handling and mailing expenses incurred by them in forwarding  materials relating
to the offer to their  customers.  Pre-Paid  Legal  Services  will pay all stock
transfer  taxes  applicable  to its  purchase  of shares  pursuant to the offer,
subject to Instruction 8 of the Letter of Transmittal.

No broker,  dealer,  bank,  trust company or fiduciary shall be deemed to be the
agent of Pre-Paid Legal Services, other than UMB Bank, N.A. as the "depositary,"
and Georgeson Shareholder  Communications,  Inc. as the "information agent," for
purposes of the offer.

For your information and for forwarding to your clients for whom you hold shares
registered  in your name or in the name of your  nominee,  we are  enclosing the
following documents:

1.   Offer to Purchase, dated August 26, 2004 (white booklet);

2.   Letter to clients which may be sent to your clients for whose  accounts you
     hold shares  registered  in your name or in the name of your  nominee,  and
     related  Instruction  Form for  obtaining  the clients'  instructions  with
     regard to the offer;

3.   Letter of Transmittal  for your use and for the information of your clients
     (blue document), which includes guidelines for Substitute Form W-9; and

4.   A return envelope addressed to UMB Bank, N.A.., as depositary.

We urge you to  contact  your  clients  as  promptly  as  possible.  The  offer,
proration period and withdrawal  rights will expire at 5:00 p.m., New York Time,
on September 28, 2004, unless the offer is extended.

In order to take advantage of the offer, a duly executed and properly  completed
Letter of  Transmittal  and any other required  documents  should be sent to the
depositary  with  either  certificate(s)  representing  the  tendered  shares or
confirmation  of  their  book-entry   transfer,   all  in  accordance  with  the
instructions set forth in the Letter of Transmittal and the Offer to Purchase.

Any  inquiries you may have with respect to the offer should be addressed to the
depositary or the information agent at their respective  addresses and telephone
numbers set forth on the back cover page of the Offer to Purchase.

Nothing  contained  herein or in the enclosed  documents shall constitute you or
any  other  person  as an  agent  of  Pre-Paid  Legal  Services  or  any  of its
affiliates,  the information  agent or the  depositary,  or authorize you or any
other person to use any document or make any  statement on behalf of any of them
in connection with the offer other than the documents  enclosed herewith and the
statements contained therein.

Additional  copies of the enclosed material may be obtained from the information
agent, Georgeson Shareholder Communications, Inc. telephone: (866) 828-4304.

                                                   Very truly yours,

                                                   Pre-Paid Legal Service, Inc.
Enclosures.





                               EXHIBIT (a)(5)(ii)

                          PRE-PAID LEGAL SERVICES, INC.
                        Offer to Purchase for Cash up to
                      1,000,000 Shares of Its Common Stock
                   at a Purchase Price Not in Excess of $26.00
                         Nor Less Than $22.50 Per Share
                THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS
         EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON SEPTEMBER 28, 2004,
                          UNLESS THE OFFER IS EXTENDED

To Our Clients:

Enclosed for your consideration are the Offer to Purchase (white booklet), dated
August 26,  2004,  and the related  Letter of  Transmittal  (blue  document)  in
connection  with the offer by Pre-Paid  Legal  Services,  Inc. to purchase up to
1,000,000  shares of its common stock,  $0.01 par value per share, at prices not
in excess of $26.00 nor less than $22.50 per share,  as  specified  by tendering
stockholders,  upon the terms and  subject  to the  conditions  set forth in the
Offer to Purchase and the Letter of Transmittal.

Pre-Paid Legal Services will determine the single per share price, not in excess
of $26.00 nor less than  $22.50 per  share,  net to the seller in cash,  that it
will pay for shares validly tendered pursuant to the offer,  taking into account
the  number  of  shares  so  tendered  and the  prices  specified  by  tendering
stockholders. Pre-Paid Legal Services will select the lowest purchase price that
will allow it to buy 1,000,000  shares,  or the lesser number of shares that are
validly  tendered  at prices  not in excess of $26.00  nor less than  $22.50 per
share. All shares properly tendered at prices at or below the purchase price and
not withdrawn on or prior to the expiration date, as defined in Section 1 of the
Offer to Purchase, will be purchased at the purchase price, subject to the terms
and conditions of the offer, including the proration, conditional tender and odd
lot provisions. See Sections 1, 2 and 6 of the Offer to Purchase.

Upon the terms and subject to the conditions of the offer,  if at the expiration
of the offer more than  1,000,000  shares are  validly  tendered at or below the
purchase  price and not  withdrawn,  Pre-Paid Legal Services will buy shares (i)
first from  stockholders who own of record or beneficially an aggregate of fewer
than 100 shares who  properly  tender all their shares at prices at or below the
purchase price, (ii) second,  on a pro rata basis,  from all other  stockholders
who  properly  tender at or below the purchase  price and do not  withdraw  them
prior to the  expiration  of the  offer,  other  than  stockholders  who  tender
conditionally  and for whom the condition is not satisfied,  and (iii) third, if
necessary,  shares  conditionally  tendered,  for  which the  condition  was not
satisfied,  at prices at or below the purchase  price selected by random lot. If
any  stockholder  tenders all of his or her shares and wishes to avoid proration
or to limit the  extent to which only a potion of such  shares may be  purchased
because of the proration  provisions,  the stockholder may tender shares subject
to the  condition  that a  specified  minimum  number  of shares or none of such
shares be  purchased.  See  Sections  1, 2 and 6 of the Offer to  Purchase.  All
shares not purchased pursuant to the offer,  including shares tendered at prices
greater than the purchase price and shares not purchased because of proration or
because they were  conditionally  tendered and not accepted for purchase will be
returned to the tendering  stockholders  at Pre-Paid  Legal  Services's  expense
promptly following the expiration date of the offer.

We are the owner of record of shares held for your  account.  Therefore,  we are
the only  ones who can  tender  your  shares,  and then  only  pursuant  to your
instructions.  We are sending you the Letter of Transmittal  (blue document) for
your  information  only;  you  cannot  use it to tender  shares we hold for your
account.  To tender  your  shares held by us,  please  complete  and execute the
enclosed Instruction Form (purple document).

Please  instruct us as to whether you wish us to tender any or all of the shares
we hold for your  account  on the terms and  subject  to the  conditions  of the
offer.

We call your attention to the following:

1.   You may  tender  shares  at prices  not in  excess of $26.00  nor less than
     $22.50 per share as  indicated  in the  enclosed  Instruction  Form (purple
     document),  net to you in  cash,  without  interest.  If you do not wish to
     specify a purchase  price,  you may indicate  that you have  tendered  your
     shares at the purchase price (not greater than $26.00 nor less than $22.50)
     as determined by Pre-Paid  Legal  Services in accordance  with the terms of
     the offer.

2.   You may  tender  your  shares  conditioned  upon  Pre-Paid  Legal  Services
     purchasing  all or a  minimum  number  of  your  shares.  To  elect  such a
     condition,  complete the box captioned "Conditional Tender" in the enclosed
     Instruction Form.

3.   The offer is not conditioned on any minimum number of shares being tendered
     pursuant  to the offer.  The offer is,  however,  subject to certain  other
     conditions  as set forth in the  Offer to  Purchase.  See  Section 7 of the
     Offer to Purchase.

4.   The offer, proration period and withdrawal rights will expire at 5:00 p.m.,
     New York City time, on September 28, 2004,  unless  Pre-Paid Legal Services
     extends the offer.

5.   The offer is for 1,000,000  shares,  constituting  approximately  6% of the
     shares outstanding as of August 25, 2004.

6.   Tendering   stockholders  will  not  be  obligated  to  pay  any  brokerage
     commissions,  solicitation fees, or, subject to Instruction 8 of the Letter
     of Transmittal,  stock transfer taxes on Pre-Paid Legal Services's purchase
     of shares pursuant to the offer.

7.   If you  beneficially  held; an aggregate of fewer than 100 shares,  and (i)
     you  instruct  us to tender on your  behalf all your shares at or below the
     purchase  price before the  expiration  date of the offer and (ii) complete
     the box  captioned  "Odd  Lots"  in the  enclosed  Instruction  Form,  then
     Pre-Paid  Legal  Services,  upon the terms and subject to the conditions of
     the offer,  will accept all your shares for purchase before  proration,  if
     any,  of the  purchase  of other  shares  validly  tendered at or below the
     purchase price.

8.   If you wish to tender portions of your shares at different prices, you must
     complete  a separate  Instruction  Form for each price at which you wish to
     tender each  portion of your  shares.  We must submit  separate  Letters of
     Transmittal  on your  behalf for each price you will  accept.  You  cannot,
     however, tender the same shares at different prices.

If you wish to have us tender any or all of your  shares,  please so instruct us
by completing, executing, detaching and returning to us the enclosed Instruction
Form.  An envelope to return your  Instruction  Form to us is  enclosed.  If you
authorize  us to tender your shares,  we will tender all your shares  unless you
specify otherwise on the enclosed Instruction Form.

Your  instruction  form should be  forwarded to us in ample time to permit us to
submit a tender on your  behalf on or before the  expiration  date of the offer.
The offer,  proration period and withdrawal rights expire at 5:00 p.m., New York
City time, on September 28, 2004,  unless  Pre-Paid Legal  Services  extends the
offer.

As  described  in  Section 1 of the Offer to  Purchase,  if more than  1,000,000
shares have been validly  tendered at prices at or below the purchase  price and
not  withdrawn on or prior to the  expiration  date,  as defined in the Offer to
Purchase,  Pre-Paid Legal Services will purchase properly tendered shares on the
basis set forth below:

(a) first,  all shares  validly  tendered  and not  withdrawn on or prior to the
expiration  date by or on  behalf  of any  stockholder  who  owns of  record  or
beneficially an aggregate of fewer than 100 shares who:

(1) validly  tenders all of the shares at a price at or below the purchase price
- partial and conditional tenders will not qualify for this preference; and

(2) completes the box captioned "Odd Lots" on the Letter of Transmittal; and

(b) second,  after  purchase of all of the forgoing  shares,  all shares validly
tendered from other  stockholders  who properly tender their shares at prices at
or  below  the  purchase  price,  and  who do not  withdraw  them  prior  to the
expiration of the offer, other than stockholders who tender  conditionally,  and
for whom the condition is not  satisfied,  on a pro rata basis with  appropriate
adjustments to avoid purchases of fractional  shares, as described in Sections 1
and 6 of the Offer to Purchase.

(c) third, if necessary,  shares validly and conditionally  tendered at or below
the  purchase  price  and not  withdrawn  on or  prior to the  expiration  date,
selected by random lot in accordance with Section 6 of the Offer to Purchase.


You may condition your tender on Pre-Paid  Legal  Services  purchasing a minimum
number of your  tendered  shares.  In such case, if as a result of the proration
provisions in the Offer to Purchase  Pre-Paid Legal Services would purchase less
than the minimum  number of your shares,  then Pre-Paid  Legal Services will not
purchase any of your shares, except as provided in the next sentence. If so many
conditional tenders would be deemed withdrawn that the total number of shares to
be purchased falls below 1,000,000 shares, then to the extent feasible, Pre-Paid
Legal  Services  will  select  enough  of the  conditional  tenders  that  would
otherwise  have been so withdrawn to permit  Pre-Paid Legal Services to purchase
1,000,000  shares.  In selecting among the conditional  tenders,  Pre-Paid Legal
Services  will  select by lot and will  limit its  purchase  in each case to the
minimum  number  of  shares  designated.  See  Sections  1 and 6 of the Offer to
Purchase.

The offer is being made to all holders of shares. Pre-Paid Legal Services is not
aware of any  jurisdiction  where the  making of the offer is not in  compliance
with  applicable   law.  If  Pre-Paid  Legal  Services   becomes  aware  of  any
jurisdiction  where the making of the offer is not in compliance  with any valid
applicable law,  Pre-Paid Legal Services will make a good faith effort to comply
with the law. If, after a good faith  effort,  Pre-Paid  Legal  Services  cannot
comply with the law, the offer will not be made to, nor will tenders be accepted
from or on behalf of, holders of shares residing in that jurisdiction.





                               EXHIBIT (a)(5)(iii)

                                  PRESS RELEASE


For Release 8:30 a.m. Eastern                     Company      Steve Williamson
Thursday, August 26, 2004                         Contact:        (580) 436-1234


                   PRE-PAID LEGAL SERVICES, INC. OFFERS TO BUY
                   UP TO 1,000,000 SHARES OF ITS COMMON STOCK
                  AND ANNOUNCES INCREASE TO STOCK PURCHASE LOAN

     ADA,  OK,  August 26, 2004 - Pre-Paid  Legal  Services,  Inc.  (NYSE:  PPD)
announced  today that it has commenced a  self-tender  offer for up to 1,000,000
shares of its common  stock,  which  represents  approximately  6 percent of its
outstanding  shares.  The tender offer will be in the form of a "modified  Dutch
auction tender." Under this procedure, Pre-Paid Legal Services stockholders will
be given the opportunity to sell part or all of their shares to the Company at a
price of not less than $22.50 per share and not more than $26.00 per share. This
price range  represents  a 5.3 percent  discount to a 9.5 percent  premium  when
compared to the August 25, 2004  closing  price of $23.75 per share.  Based upon
the minimum and maximum  offering prices  specified in the offer,  the aggregate
purchase  price,  if  1,000,000  shares are  purchased,  would  range from $22.5
million to $26.0 million. The offer to purchase shares will expire at 5:00 p.m.,
Eastern Time, on September 28, 2004, unless extended by the Company.

     Under the procedures for a modified Dutch auction tender,  stockholders may
offer to sell all or a portion of the  shares  they own at a price not more than
the maximum price ($26.00) nor less than the minimum price ($22.50) specified in
the tender. Upon the expiration of the offer, the Company will select the lowest
purchase price that will allow it to buy 1,000,000 shares.  All shares purchased
in the offer will  receive the same price.  If the number of shares  tendered is
equal to or less than 1,000,000  shares,  the purchase price will be the highest
price specified by tendering  stockholders.  If the number of shares tendered is
greater  than the number  sought,  the Company will select the lowest price that
will allow it to buy the number of shares it seeks.

     The company has entered into an amended stock term loan agreement with Bank
of Oklahoma,  N.A.,  Comerica Bank and First United Bank & Trust to increase its
existing  loan to up to $31.5  million  or a net  increase  in  credit  of $17.6
million above the outstanding balance of its existing term loan of $13.9 million
as of August  25,  2004.  Proceeds  of this loan  together  with  existing  cash
resources will be used to purchase shares in the tender offer.  The amortization
of the amended loan has been modified to provide for repayment over 24 months in
equal monthly principal payments beginning October 31, 2004 and ending September
30, 2006 with the same  interest  rate of the monthly LIBOR rate plus 3%. Before
amendment,  the loan was to be repaid in monthly  installments ending on May 31,
2005.  If the loan is fully  advanced,  the monthly  principal  payment  will be
$1,313,000  compared to the monthly  payment on the current loan of  $1,390,000.
The amended  loan  agreement  continues  all of the  covenants  of the  existing
agreement with certain modifications to permit additional stock purchases and/or
dividends  while the loan is outstanding  generally in an amount no greater than
50% of net  income and  modifies  the debt  service  coverage  ratio  definition
slightly.

     Harland  C.  Stonecipher,  Pre-Paid's  Chairman,  stated,  "Pre-Paid  Legal
Services is making the tender offer because our Board of Directors believes that
the  purchase  of shares  pursuant  to the offer will have a positive  impact on
stockholder value. The Board of Directors  determined the modified Dutch auction
tender offer was the most advantageous to the Company,  its stockholders and the
investment   community  and  provides  additional   liquidity  to  our  existing
shareholders.  On a pro forma basis, we expect the successful  completion of the
tender offer to increase earnings per share and return on stockholders' equity."

     Georgeson Shareholder Communications will act as the information agent, and
UMB Bank, N.A. will be the depositary for the shares  tendered.  Questions to or
requests for assistance may be directed to Georgeson  Shareholder,  toll free at
(866) 828-4305.

     Neither  Pre-Paid  Legal  Services  nor its  Board of  Directors  makes any
recommendation  to any  stockholder  as to  whether  to tender or  refrain  from
tendering  any or all of such  stockholder's  shares  in the  offer  and has not
authorized  any person to make any such  recommendation.  This  announcement  is
neither an offer to purchase  nor a  solicitation  of an offer to sell shares of
Pre-Paid Legal Services  common stock.  The offer is made solely by the offer to
purchase dated August 26, 2004 and the related letter of transmittal. Pre-Paid's
directors,  executive  officers and Messrs.  Thomas Smith,  Thomas  Tryforos and
Scott Vassalluzzo,  who collectively  comprise Prescott  Investors,  and are the
Company's  largest  shareholder,  have  indicated they do not plan to tender any
shares pursuant to the tender offer.

     Pre-Paid  Legal  Services  develops and markets  legal service plans across
North America. The plans provide for legal service benefits, including unlimited
attorney   consultation,   will   preparation,    traffic   violation   defense,
automobile-related   criminal   charges   defense,   letter  writing,   document
preparation and review and a general trial defense benefit. More information can
be   located   at   the   Company's   homepage   on   the   worldwide   web   at
http://www.prepaidlegal.com.

     Forward-Looking Statements
     Statements in this press release, other than purely historical information,
regarding  the  Company's  future plans and  objectives  and expected  operating
results,   and  statements  of  the  assumptions   underlying  such  statements,
constitute  forward-looking  statements within the meaning of Section 21E of the
Securities Exchange Act of 1934. The forward-looking statements contained herein
are based on certain  assumptions  that may not be correct.  They are subject to
risks and  uncertainties  incident to the  Company's  business  that could cause
actual results to differ materially from those described in the  forward-looking
statements.  These  risks and  uncertainties  are  described  in the reports and
statements  filed by the Company with the  Securities  and Exchange  Commission,
including  (among others) those listed in the Company's Form 10-K and Form 10-Q,
and include the risks that the Company's membership persistency or renewal rates
may  decline,  that  the  Company  may  not be  able to  continue  to  grow  its
memberships and earnings,  that the Company is dependent on the continued active
participation  of its  principal  executive  officer,  that  pending  or  future
litigation  may have a  material  adverse  effect  on the  Company  if  resolved
unfavorably  to the Company,  that the Company  could be  adversely  affected by
regulatory  developments,  that competition  could adversely affect the Company,
that the Company is  substantially  dependent on its marketing  force,  that the
Company's  stock price may be affected by short sellers and that the Company has
been unable to increase  significantly  its  employee  group  membership  sales.
Please  refer to pages 39 and 40 of the  Company's  2003  Form  10-K and pages 8
through  10 of the  Company's  June  30,  2004  Form  10-Q  for a more  complete
description of these risks. The Company  undertakes no duty to update any of the
forward-looking statements in this release.


                                 EXHIBIT (b)(i)

                        FIRST AMENDMENT TO LOAN AGREEMENT


     THIS FIRST AMENDMENT TO LOAN AGREEMENT (this "Amendment") is made effective
as of the ____ day of August,  2004,  by and between  PRE-PAID  LEGAL  SERVICES,
INC., an Oklahoma  corporation  (the  "Borrower") and BANK OF OKLAHOMA,  N.A., a
national  banking  association  ("BOK") and COMERICA  BANK  ("Comerica"),  FIRST
UNITED  BANK &  TRUST,  a state  banking  corporation  ("FUB"),  and each of the
financial  institutions  which  may  from  time to time  become  a party  hereto
pursuant  to the  provisions  of  Section  12.1  of the  Loan  Agreement  or any
successor or assignee thereof (hereinafter  collectively referred to as "Banks",
and individually, "Bank") and BOK, as Agent ("Agent").


                              W I T N E S S E T H:

     WHEREAS, on September 19, 2003, Borrower and Bank agreed to an extension of
credit in the  principal  amount of  Twenty  Five  Million  and  No/100  Dollars
($25,000,000.00)  from the Banks to the Borrower  consisting  of a term loan for
the primary purpose of purchasing  Borrower's shares of stock in the open market
all as  described  in that  certain  Loan  Agreement  dated as of such date (the
"Agreement").

     WHEREAS,   the  Borrower's   obligations  pursuant  to  the  Agreement  and
promissory  notes  described  therein  are  secured  by  certain  collateral  as
described in the Agreement;

     WHEREAS, all collateral securing the indebtedness evidenced by or described
in the  Agreement  and the  Note  shall  continue  to  secure  the  indebtedness
described in the Agreement, as hereby amended;

     WHEREAS,  all  capitalized  terms not otherwise  defined  herein shall have
those meanings assigned to such terms in the Agreement; and

     WHEREAS,  Borrower  and Banks desire to amend the  Agreement  for the first
time in order to, among other things not specifically set forth in this recital,
redefine the debt coverage ratio,  extend the maturity date,  advance additional
sums, and such other changes as are more specifically set forth herein.

NOW,  THEREFORE,  in  consideration of the foregoing and for such other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the parties hereto agree as follows:

                                   ARTICLE 1

                          CHANGES TO THE LOAN AGREEMENT

     Borrower  and Bank have  agreed to  modify,  supplement  and amend  certain
portions  and/or terms of the  Agreement.  The  Agreement  is hereby  amended as
follows:

     1.1  The  reference  to  "$25,000,000"  set  forth  in  the  definition  of
"Commitment" at Section 1.7 of the Agreement is hereby deleted and replaced with
"$31,500,000" in order to evidence the increase to the Loan.

     1.2 The definition of the term "Debt Service  Coverage  Ratio" set forth at
Section 1.10 of the Agreement is hereby amended and restated in its entirety, as
follows:

          1.10 Debt Coverage  Ratio.  The term "Debt Coverage  Ratio" shall mean
     (A) for the previous three-months annualized,  Net Income plus depreciation
     and amortization, plus interest expense minus (i) construction costs on the
     Borrower's  new home office  facility or other  facilities for the previous
     twelve (12) months which were not funded by the Borrower's real estate loan
     from BOK and (ii) an additional $1,000,000  (representing a mutually agreed
     level of anticipated  annual  maintenance  capital  expenditures) and (iii)
     stock  purchases  for the  previous  twelve  (12)  months  excluding  stock
     purchases  funded by the $25 million loan or purchases of up to $31,500,000
     worth of shares of common  stock  from the date of this  Amendment  through
     December  31,  2004  DIVIDED  BY (B) for the  next  ensuing  twelve-months,
     principal  payments  due on all Funded Debt plus  interest  expense for the
     previous  three (3)  months  annualized  plus  dividends  declared  for the
     previous twelve (12) months.

          1.3  The definition of the term  "Maturity  Date" set forth at Section
     1.27 of the  Agreement  is hereby  amended and  restated in its entirety in
     order to evidence the extension of the maturity, as follows:

               1.27 Maturity Date. The term "Maturity Date" shall mean September
          30, 2006.

     1.4 The  reference to  "$25,000,000"  set forth in the Section 2.1.1 of the
Agreement, Principal, is hereby deleted and replaced with "$31,500,000" in order
to evidence the increase to the Loan.

     1.5 The  reference to "November 30, 2003" set forth in the Section 2.1.3 of
the  Agreement,  Advances  and  Purpose,  is hereby  deleted and  replaced  with
"December  31,  2004" in order to evidence  the  extension  of the  availability
period.

     1.6  Section  2.1.5 of the  Agreement,  Repayment,  is hereby  amended  and
restated in its entirety as follows: ---------

          2.1.5 Repayment. Beginning October 31, 2004 and continuing on the last
     day of each month  thereafter  through  September 30, 2006,  Borrower shall
     make a principal  payment in the amount of  $1,312,500.00  together  with a
     payment of all accrued but unpaid interest.  All outstanding principal plus
     all accrued but unpaid interest is due and payable on the Maturity Date.

     1.7 Section 2.5 of the Agreement,  Prepayment and  Prepayment  Penalty,  is
hereby amended and restated in its entirety as follows:


          2.5 Prepayment and Prepayment Penalty. Except as set forth herein, the
     Borrower  may prepay any or all of the Loan,  either in whole or in part at
     any time and from time to time, on any date without premium or penalty.

          1.8 Section 7.5 of the  Agreement,  Dividends  and  Distributions,  is
     hereby amended and restated in its entirety as follows:

                  7.5 Dividends and Distributions. Borrower shall not declare,
          pay or make, whether in cash or property, or set aside or apply any
          money or assets to pay or make any dividend or other distribution with
          respect to its capital stock or purchase shares of its capital stock,
          which during any fiscal quarter, on a combined basis, would exceed
          fifty percent (50%) of the Borrower's cumulative Net Income for all
          previous fiscal quarters beginning July 1, 2004 less any dividends or
          distributions or stock purchases in such previous fiscal quarters. To
          the extent, Borrower does not utilize its availability to make a
          dividend or purchase capital stock in any given quarter such amount
          not so utilized shall be available in subsequent quarterly periods.
          Provided further, Borrower shall not be permitted to make any dividend
          or purchase any shares (including those permitted by the next proviso)
          if there exists as of the time of the dividend or purchase an Event of
          Default or if the declaration or payment of the dividend or purchase
          of the shares shall create an Event of Default. Provided, further,
          that any stock purchases funded by the $25 million loan or purchases
          of up to $31,500,000 worth of shares of Borrower's common stock from
          the date of this Amendment through December 31, 2004 shall not be
          subject to such limitation.

     1.9 The text of Section 7.10 of the  Agreement,  Purchases of Common Stock,
is hereby  deleted from the  Agreement  in its  entirety  and replaced  with the
phrase  "INTENTIONALLY  DELETED" in order to evidence  the  elimination  of this
covenant.

     1.10 Section 8.2 of the  Agreement,  Retention  Rate, is hereby amended and
restated  in its  entirety  in order to change the  requirement  to a  quarterly
requirement as follows:

          8.2 Retention Rate.  Borrower shall maintain,  on a consolidated basis
     and in accordance with GAAP, a rolling twelve (12) month average  retention
     rate of membership contracts in place for greater than eighteen (18) months
     of not less than seventy  percent (70%),  calculated on a quarterly  basis.
     Within  forty  five (45) days of the end of each  quarter,  Borrower  shall
     deliver  a  Compliance  Certificate   demonstrating  compliance  with  this
     financial covenant.

     1.11 Section 8.3 of the Agreement, Cancellation Rate, is hereby amended and
restated  in its  entirety  in order to change the  requirement  to a  quarterly
requirement as follows:

          8.3 Cancellation Rate. Borrower's  cancellation rate on contracts less
     than or equal to twelve (12) months old, on a consolidated basis, shall not
     exceed 45% on a trailing  twelve (12) month basis,  measured on a quarterly
     basis.  Within  forty five (45) days of the end of each  quarter,  Borrower
     shall deliver a Compliance Certificate  demonstrating  compliance with this
     financial covenant.

     1.12 Section 8.4 of the  Agreement,  Tangible Net Worth,  is hereby amended
and restated in its entirety as follows:

          8.4 Tangible Net Worth.  Borrower's  Tangible Net Worth (as  hereafter
     defined),  determined on a consolidated  basis and in accordance with GAAP,
     shall not fall below:  (i)  $10,000,000 for that period of time dating from
     the quarter ending  September 30, 2004 through the quarter ending  December
     31, 2004; (ii)  $15,000,000 for that period of time dating from the quarter
     ending March 31, 2005 through the quarter  ending  September 30, 2005;  and
     (iii)  $25,000,000  for that period of time dating from the quarter  ending
     December 31, 2005 and on each quarter end thereafter.

     1.13 The  Borrower's  address set forth at Section 12.3 of the Agreement is
hereby changed to "One Pre-Paid Way, Ada, Oklahoma 74820".

     1.14 To evidence the  Borrower's  continuing  obligation to repay the Loan,
the  Borrower  shall  make and  deliver  to the Banks an  Amended  and  Restated
Promissory  Note in the form of Annex  "1"  hereto  attached  (the  "Replacement
Note"), which such Replacement Note shall substitute and replace in its entirety
the Notes  referred  to in the  Agreement,  without  cancellation,  novation  or
payment.

     1.12 The  document  attached  hereto  as Annex No. 2 shall  replace  in its
     entirety the document attached to the Agreement as Schedule 1.7.

                                   ARTICLE 2

                         REPRESENTATIONS AND WARRANTIES

     2.1 This Amendment,  when duly executed and delivered,  will constitute the
legal, valid and binding obligation of Borrower,  enforceable in accordance with
its terms.

     2.2 All balance  sheets,  income  statements and other financial data which
have been or are  hereafter  furnished  to Agent by the  Borrower  to induce the
Banks to make or extend the loans hereunder due, and as to subsequent  financial
statements will, fairly represent Borrower's financial condition as of the dates
for which the same are furnished. All such financial statements, reports, papers
and other data furnished to Agent are and will be, when furnished,  accurate and
correct in all material  respects and complete  insofar as  completeness  may be
necessary to give the Banks a true and accurate  knowledge of the subject matter
and, since the date of such financial statements, no material adverse change has
occurred in the operations or condition, financial or otherwise, of Borrower.

     2.3  With  the  exception  of  Section  5.16 of the  Agreement,  all of the
Borrower's  representations  and  warranties  set  forth  in  Section  5 of  the
Agreement, REPRESENTATIONS AND WARRANTIES, are true and correct on and as of the
date hereof  with the same effect as though made and  repeated by Borrower as of
the date hereof.

     2.4 The  principal  place of  business  of Borrower in Oklahoma is has been
moved to One Pre-Paid Way, Ada, Oklahoma 74820.

                                   ARTICLE 3

                        CONDITIONS PRECEDENT TO AMENDMENT

     Banks' obligations  pursuant to this Amendment are subject to the following
conditions:

     3.1 Banks and Borrower shall have executed and delivered this Amendment.

     3.2 Borrower  shall have  executed and delivered to each Bank a Replacement
Note.

     3.3 Each  Guarantor  shall have  executed  and  delivered  an  Amended  and
Restated Guaranty Agreement in form and substance acceptable to each Bank.

     3.4 Borrower  shall have executed and delivered to each Bank any amendments
to the other Loan Documents (other than the Agreement) as required by each Bank.

     3.5  Borrower  shall  have paid  Agent an  amendment  fee in the  amount of
$100,000.00 for the ratable benefit of the Banks.

     3.6 The  Borrower's  representations  and warranties set forth in Article 2
hereof shall be true and correct on and as of the date hereof.

     3.7 As of the date hereof,  no Event of Default nor any event  which,  with
the  giving of notice or lapse of time,  would  constitute  an Event of  Default
shall have occurred and be continuing.

                                   ARTICLE 4

                     OTHER COVENANTS AND MISCELLANEOUS TERMS

     4.1 Except as expressly  amended and  supplemented  hereby,  the  Agreement
shall  remain  unchanged  and in full force and  effect,  and the same is hereby
ratified and extended.

     4.2 The indebtedness described in the Agreement,  including but not limited
to the  indebtedness  or exposure  evidenced by the Note,  shall  continue to be
secured by the Collateral, without interruption or impairment of any kind.

     4.3 This  Amendment  shall be construed in accordance  with and governed by
the laws of the  State of  Oklahoma,  and shall be  binding  on and inure to the
benefit of the Borrower and Banks, and their respective  successors and assigns.
All  obligations of the Borrower under the Agreement and all rights of each Bank
and any other holder of the Note, whether expressed herein or in any Note, shall
be in addition to and not in  limitation of those  provided by  applicable  law.
Borrower and Banks irrevocably agree that all suits or proceedings  arising from
or related to the  Agreement,  as  amended,  or the Note shall be  litigated  in
courts (whether State or Federal)  sitting in Oklahoma City,  Oklahoma,  and the
Borrower and Banks hereby  irrevocably  waive any objection to such jurisdiction
and venue.

     4.4 This  Amendment may be executed in as many  counterparts  as are deemed
necessary or convenient, and it shall not be necessary for the signature of more
than any one party to appear on any single  counterpart.  Each counterpart shall
be deemed an original,  but all shall be construed  together as one and the same
instrument.  The  failure  of any party to sign  shall  not  affect or limit the
liability of any party executing any such counterpart.

         Executed effective as of August ___, 2004.



          BORROWER:                  PRE-PAID LEGAL SERVICES, INC.,
                                     an Oklahoma Corporation:


                                     By:    \s\Randy Harp
                                     Name:  Randy Harp
                                     Title:   Chief Operating Officer






         BANK:                       BANK OF OKLAHOMA, N.A.
                                     \s\ Laura Chrisofferson
                                     By:  Laura Christofferson
                                     Its:  Senior Vice President







                                     COMERICA BANK



                                     ___________________________________________
                                     By:________________________________________
                                     Title:   Senior Vice President







                                     FIRST UNITED BANK & TRUST,
                                     a state banking corporation



                                     ___________________________________________
                                     By:________________________________________
                                     Title:   ___________President




                                   ANNEX NO. 1


                      AMENDED AND RESTATED PROMISSORY NOTE


$________________                                        Oklahoma City, Oklahoma

     FOR VALUE RECEIVED,  PRE-PAID LEGAL SERVICES, INC., an Oklahoma corporation
(the "Maker") promises to pay to the order of BANK OF OKLAHOMA, N.A., a national
banking  association  ("Bank")  at the  office of Bank of  Oklahoma,  N.A.  (the
"Agent")  in  Oklahoma  City,  Oklahoma,  which is located at 201 Robert S. Kerr
Ave.,  or such other  place as may be  designated  in writing by the Agent,  the
principal   sum  of   __________   Million   ___________   and  __/100   Dollars
($_____________),  or so much  thereof  as shall  be  disbursed,  together  with
interest at the rate stated herein on such outstanding  principal amount, and on
any past due interest payments, payable as follows:

          This Note is subject to the terms and  conditions of that certain Loan
     Agreement  dated  September  19,  2003,  as amended by that  certain  First
     Amendment  to Loan  Agreement  dated of even  date  herewith,  between  the
     undersigned,  certain lenders named therein, including, without limitation,
     the Bank and Bank of  Oklahoma,  N.A.,  as Agent  (as  amended,  the  "Loan
     Agreement"),   which  terms  and  conditions  are  hereby  incorporated  by
     reference  herein and shall be controlling  over any provision of this Note
     to the  contrary.  Reference  is hereby  made to the Loan  Agreement  for a
     statement  of the  calculation  and  computation  of the  rate of  interest
     charged  on  amounts  outstanding  under  this  Note,  for a  statement  of
     repayment and prepayment  rights and obligations of Maker,  for a statement
     of the terms and  conditions  under  which the due date of this Note may be
     accelerated and for statements  regarding other matters affecting this Note
     (including  without  limitation  the  obligations  of the holder  hereof to
     advance  funds  hereunder,  exercise  of rights  and  remedies,  payment of
     attorneys'  fees,  court  costs and other costs of  collection  and certain
     waivers by Maker and others now or hereafter  obligated  for payment of any
     sums due  hereunder).  Upon the occurrence of an Event of Default,  as that
     term is  defined in the Loan  Agreement,  and after the  expiration  of any
     grace or cure period as set forth in the Loan Agreement,  the holder hereof
     (i) may declare  forthwith to be entirely and  immediately  due and payable
     the principal  balance  hereof and the interest  accrued  hereon,  and (ii)
     shall have all rights and  remedies of the Banks  under the Loan  Agreement
     and Loan  Documents.  This Note may be prepaid in accordance with the terms
     and  provisions  of the Loan  Agreement.  Capitalized  terms not  otherwise
     defined herein shall be defined as set forth in the Loan Agreement.

          This Note is one of the  Notes,  as such term is  defined  in the Loan
     Agreement.

          This  Note is to be  construed  according  to the laws of the State of
     Oklahoma.

     The undersigned agrees that if, and as often as, this Note is placed in the
hands of an attorney for  collection or to defend or enforce any of the holder's
rights  hereunder,  the undersigned will pay to the holder hereof its reasonable
attorney's  fees,  together with all court costs and other expenses paid by such
holder.

     All  payments  on this Note  shall be made in legal  tender  of the  United
States of America or other  immediately  available funds at the Agent's or other
holder's  address as shown  herein or otherwise  indicated  and any such payment
will not be deemed to have been made until it is  received by the holder of this
Note in collected funds.

     All agreements between the undersigned and the holder are expressly limited
so that in no  event  whatsoever,  whether  by  reason  of  disbursement  of the
proceeds  hereof or otherwise shall the amount of interest or finance charge (as
defined by the laws of the State of  Oklahoma)  paid or agreed to be paid by the
undersigned to the holder hereof exceed the highest lawful  contractual  rate of
interest or the maximum finance charge  permissible  under the law which a court
of competent  jurisdiction,  by final  non-appealable  order,  determines  to be
applicable  hereto.  If fulfillment of any agreement between the undersigned and
the holder hereof,  at the time the  performance of such agreement  becomes due,
involves  exceeding  such  highest  lawful  contractual  rate  or  such  maximum
permissible  finance  charge,  then the  obligation to fulfill the same shall be
reduced so such obligation does not exceed such highest lawful  contractual rate
or maximum  permissible  finance charge. If by any circumstance the holder shall
ever  receive as interest  or finance  charge an amount  which would  exceed the
amount allowed by applicable law, the amount which may be deemed excessive shall
be deemed applied to the principal of the indebtedness  evidenced hereby and not
to interest.  All interest and finance  charges paid or agreed to be paid to the
holder hereof shall be prorated, allocated and spread throughout the full period
of this Note. The terms and provisions of this paragraph shall control all other
terms and provisions  contained  herein and in any other  documents  executed in
connection  herewith.  If any provision of this Note, or the application thereof
to any party or circumstance is held invalid or unenforceable,  the remainder of
this  Note  and  the   application   of  such  provision  to  other  parties  or
circumstances  shall not be  affected  thereby,  provisions  of this Note  being
severable in any such instance.

     The makers, endorsers,  sureties,  guarantors and all other persons who may
become liable for all or any part of this obligation severally waive presentment
for  payment,  protest and notice of  nonpayment.  Said  parties  consent to any
extension of time (whether one or more) of payment hereof,  any renewal (whether
one or more)  hereof,  and any  release of any such party  liable for payment of
this note  without  notice to any such party and  without  discharging  the said
party's liability hereunder.

     The failure of the holder hereof to exercise any of the remedies or options
set forth in this Note or in any instrument  securing  payment hereof,  upon the
occurrence of one or more of the Events of Default shall not constitute a waiver
of the right to exercise the same or any other remedy at any subsequent  time in
respect  to the same or any other  Event of  Default.  Acceptance  by the holder
hereof  of any  payment  which is less  than the  total of all  amounts  due and
payable at the time of such payment  shall not  constitute a waiver of the right
to  exercise  any of the  foregoing  remedies  or options at that time or at any
subsequent  time,  or nullify  any prior  exercise of any such remedy or option,
without the express  consent of the holder  hereof,  except as and to the extent
otherwise provided by law.





     IN WITNESS WHEREOF, the undersigned has executed this instrument effective
as of August __, 2004.


                                     PRE-PAID LEGAL SERVICES, INC.,
                                     an Oklahoma Corporation:


                                     By:  \s\ Randy Harp
                                     -------------------------------------------
                                     Name:   Randy Harp
                                     Title:   Chief Operating Officer








                                   ANNEX NO. 2


                                                             SCHEDULE 1.7

                                   COMMITMENTS


      Lender                         Commitment                   Pro Rata Share
--------------------------------------------------------------------------------

Commitment of Each Lender

Bank of Oklahoma, N.A.              $14,000,000                         44.44%

Comerica Bank                       $10,000,000                         31.75%

First United Bank & Trust           $ 7,500,000                         23.81%

Total                               $31,500,000                        100.0000%






                                EXHIBIT (b)(iii)

                      First Amendment to Security Agreement


     This First  Amendment  to Security  Agreement is made as of the 26th day of
August,  2004 by Pre-Paid Legal Services,  Inc., an Oklahoma  corporation,  (the
"Debtor"),  in favor of Bank of Oklahoma,  N.A., a national banking  association
("BOK"), COMERICA BANK ("Comerica"),  First United Bank & Trust, a state banking
corporation ("FUB"), and each of the financial  institutions which may from time
to time become a party  pursuant to the  provisions  of Section 12.1 of the Loan
Agreement  dated as of  September  19,  2003 as  amended by that  certain  First
Amendment to Loan Agreement of even date herewith,  or any successor or assigned
or assignee  thereof  (hereinafter  collectively  referred  to as  "Banks",  and
individually, "Bank") and BOK, as Agent for the Banks ("Agent").

                                    RECITALS:

     A. Debtor, Agent and Banks are parties to that certain Loan Agreement dated
September 19, 2003 (the "Loan Agreement")  whereby Debtor and Banks agreed to an
extension  of credit in the  principal  amount of Twenty Five Million and No/100
Dollars   ("$25,000,000.00)   from  the   Banks  to  Debtor   consisting   of  a
$25,000,000.00  term loan for the primary purpose of purchasing  Debtor's shares
of stock in the open market (the "Loan"),  as evidenced by the promissory  notes
in the aggregate amount of $25,000,000.00.

     B. On September 19, 2003,  Debtor  delivered to Banks a Security  Agreement
(the "Agreement") with reference to certain collateral (as therein defined).

     C.  Debtor,  Agent and Banks have  entered  into a First  Amendment to Loan
Agreement dated as of the date herewith ("First Amendment") in order to redefine
the debt coverage ratio,  extend the maturity date, advance additional sums, and
such other changes as are more specifically set forth therein.

     D. Pursuant to the First  Amendment,  the Debtor has executed and delivered
to Banks  Amended  and  Restated  Promissory  Notes in the  aggregate  amount of
$31,500,000.00 (the Amended and Restated Notes").

     NOW, THEREFORE,  for good and valuable consideration,  the receipt of which
is hereby  acknowledged,  Debtor  acknowledges and agrees that all references to
the term  "Notes" in the Security  Agreement  are deemed to refer to the Amended
and Restated Notes described  above as that term is defined and/or  described in
the Loan Agreement, as amended, include all obligations evidenced by the Amended
and Restated  Promissory Notes described above together with any  modifications,
amendments, and increases thereto.

     The Agreement, as amended, is hereby ratified and confirmed.



         IN WITNESS WHEREOF, Debtor has executed and delivered this Agreement to
and in favor of Secured Party effective as of the day and year first above
written.

         DEBTOR:                     PRE-PAID LEGAL SERVICES, INC.,
                                     an Oklahoma corporation

                                     \s\ Randy Harp
                                     -------------------------------------------
                                     By:      Randy Harp
                                     Title:   ______________

                                     Address: 321 East Main Street
                                     Ada, Oklahoma  74821

                                     Telephone No.: 580/436-____
                                     Facsimile No.: 580/436-7410


         BANKS:                      BANK OF OKLAHOMA, N.A.

                                     \s\ Laura Chrisofferson
                                     -------------------------------------------
                                     By:      Laura Christofferson
                                     Title:  Senior Vice President

                                     Address: Bank of Oklahoma Plaza
                                     P.O. Box 24128
                                     Oklahoma City, Oklahoma 73124

                                     Attention:        Ms. Laura Christofferson,
                                                       Senior Vice President

                                     Telephone No.:    (405) 272-2397
                                     Facsimile No.:             (405) 272-2327


                                     COMERICA BANK


                                     -------------------------------------------
                                     By:
                                        ----------------------------------------
                                     Title:   Senior Vice President


                                     FIRST UNITED BANK & TRUST,
                                     a state banking corporation


                                     -------------------------------------------
                                     By:
                                         ---------------------------------------
                                     Title:   ___________President


         AGENT:                       BANK OF OKLAHOMA, N.A.


                                     -------------------------------------------
                                     By:      Laura Christofferson
                                     Title:   Senior Vice President





                                 EXHIBIT (b)(iv)

                       First Amendment to Pledge Agreement


     This  First  Amendment  to Pledge  Agreement  is made as of the 26th day of
August,  2004 by Pre-Paid Legal Services,  Inc., an Oklahoma  corporation,  (the
"Pledgor"),  in favor of Bank of Oklahoma,  N.A., a national banking association
("BOK"), COMERICA BANK ("Comerica"),  First United Bank & Trust, a state banking
corporation ("FUB"), and each of the financial  institutions which may from time
to time become a party  pursuant to the  provisions  of Section 12.1 of the Loan
Agreement  dated as of  September  19,  2003 as  amended by that  certain  First
Amendment to Loan  Agreement of even date  herewith or any successor or assigned
or assignee  thereof  (hereinafter  collectively  referred  to as  "Banks",  and
individually, "Bank") and BOK, as Agent for the Banks ("Agent").

                                    RECITALS:

     A. Pre-Paid Legal Services, Inc. ("Borrower"),  Agent and Banks are parties
to that certain Loan Agreement dated  September 19, 2003 (the "Loan  Agreement")
whereby  Borrower and Banks  agreed to an  extension of credit in the  principal
amount of Twenty Five  Million  and No/100  Dollars  ("$25,000,000.00)  from the
Banks to  Borrower  consisting  of a  $25,000,000.00  term loan for the  primary
purpose  of  purchasing  Borrower's  shares  of stock in the  open  market  (the
"Loan"),  as  evidenced  by the  promissory  notes in the  aggregate  amount  of
$25,000,000.00.

     B. On September  19, 2003,  Pledgor  delivered to Banks a Pledge  Agreement
(the  "Agreement")  with reference to certain  collateral  (as therein  defined)
including  shares of stock of Pre-Paid  Legal  Casualty,  Inc.,  American  Legal
Services, Inc., Pre-Paid Legal Services, Inc. of Florida and Legal Service Plans
of Virginia, Inc. and membership interest in Pre-Paid Canadian Holdings, L.L.C.

     C.  Borrower,  Agent and Banks have entered into a First  Amendment to Loan
Agreement dated as of the date herewith ("First Amendment") in order to redefine
the debt coverage ratio,  extend the maturity date, advance additional sums, and
such other changes as are more specifically set forth therein.

     D. Pursuant to the First Amendment, the Borrower has executed and delivered
to Banks  Amended  and  Restated  Promissory  Notes in the  aggregate  amount of
$31,500,000.00 (the Amended and Restated Notes").

     NOW, THEREFORE,  for good and valuable consideration,  the receipt of which
is hereby  acknowledged,  Pledgor acknowledges and agrees that all references to
the term "Notes" in the Pledge  Agreement are deemed to refer to the Amended and
Restated Notes described  above as that term is defined and/or  described in the
Loan Agreement, as amended, include all obligations evidenced by the Amended and
Restated  Promissory  Notes  described  above  together with any  modifications,
amendments, and increases thereto.

     The Agreement, as amended, is hereby ratified and confirmed.



     IN WITNESS  WHEREOF,  Pledgor has executed and delivered  this Agreement to
and in favor of  Secured  Party  effective  as of the day and year  first  above
written.

         PLEDGOR:                    PRE-PAID LEGAL SERVICES, INC.,
                                     an Oklahoma corporation

                                     \s\ Randy Harp
                                     -------------------------------------------
                                     By:      Randy Harp
                                     Title:   _______________________

                                     Address: 321 East Main Street
                                     Ada, Oklahoma  74821

                                     Telephone No.: 580/436-1234
                                     Facsimile No.: 580/436-7410


         BANKS:                      BANK OF OKLAHOMA, N.A.

                                     \s\ Laura Christofferson
                                     -------------------------------------------
                                     By:      Laura Christofferson
                                     Title:  Senior Vice President

                                     Address: Bank of Oklahoma Plaza
                                     P.O. Box 24128
                                     Oklahoma City, Oklahoma 73124

                                     Attention:        Ms. Laura Christofferson,
                                                       Senior Vice President

                                     Telephone No.:    (405) 272-2397
                                     Facsimile No.:             (405) 272-2327


                                     COMERICA BANK


                                     --------------------------------------
                                     By:      _________________________
                                     Title:   Senior Vice President


                                     FIRST UNITED BANK & TRUST,
                                     a state banking corporation


                                     -------------------------------------------
                                     By:      _________________________
                                     Title:   ___________President


         AGENT:                      BANK OF OKLAHOMA, N.A.


                                     \s\ Laura Christofferson
                                     -------------------------------------------
                                     By:      Laura Christofferson
                                     Title:   Senior Vice President