Exhibit 10.1

EXECUTION VERSION

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is entered into as of September 11,
2017 (the “Effective Date”), by and among General Nutrition Centers, Inc., a
Delaware corporation (“GNCI”), GNC Holdings, Inc., a Delaware corporation (“GNC
Holdings”) (generally both or, as applicable, either, referred to herein as the
“Company”), and Ken Martindale (the “Executive”) (collectively, the “Parties”).

WHEREAS, the Company desires to employ the Executive on the terms and subject to
the conditions set forth herein and the Executive has agreed to be so employed.

NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and agreements set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties hereto, intending to be legally bound, agree as follows:

1. Employment of the Executive; Duties.

1.1 Title; Positions. During the Employment Period (as defined in Section 2),
the Executive shall serve as Chief Executive Officer of GNCI and Holdings. The
Executive shall report to the Board of Directors of GNC Holdings (the “Board”).
The Executive shall be appointed to the Board effective on the Effective Date
and will be nominated for re-election to the Board each time the Executive’s
term as a member of the Board s is scheduled to expire.

1.2 Duties. During the Employment Period, the Executive shall have the customary
duties, responsibilities and authority commensurate with such position and such
other powers and duties as may be assigned to the Executive from time to time by
the Board commensurate with the position of a Chief Executive Officer. The
Executive shall devote substantially all the Executive’s working time,
attention, knowledge and skills faithfully, and to the best of the Executive’s
ability, to the Executive’s duties and responsibilities under this Agreement
and, except where the Company provides its written consent otherwise, shall
perform his duties hereunder at the principal office of the Company in
Pittsburgh, Pennsylvania (the location as of the Effective Date, the “Company
Headquarters”). The Executive shall at all times be subject to, comply with,
observe and carry out the Company’s lawful written rules, regulations, policies
and codes of ethics and/or conduct applicable to its employees and senior
executive officers as in effect from time to time and as to which Executive has
received actual notice. During the Employment Period (defined below), the
Executive shall not be permitted to participate or invest in or manage any
for-profit business activity or venture not arising in connection with the
performance of his duties pursuant to this Agreement; provided, however, that
notwithstanding anything to the contrary, it shall not be a violation of this
Agreement for the Executive to (i) serve on the board of directors of Fairway
Group Holdings and the National Association of Chain Drug Stores and, with the
prior written approval of the Board (such approval not to be unreasonably
withheld, delayed or conditioned), serve on any other boards of directors of
for-profit companies, (ii) serve on civic or charitable boards or committees,
deliver lectures, fulfill speaking engagements, or teach at educational
institutions, and (iii) manage personal investments, so long as, in the case of
activities described in the preceding clauses (i) and (ii), (x) such activities
do not interfere with the performance of the Executive’s

 

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responsibilities in accordance with this Agreement or otherwise create a
conflict of interest or breach of this Agreement, and (y) the Executive complies
with applicable provisions of the Company’s lawful written policies and
procedures regarding such matters, if any. During the Employment Period, the
Executive will be nominated to serve as a member of the Board and as a member of
the Board of Directors of GNCI (the “GNCI Board”). To the extent the Executive
is elected to the Board or GNCI Board, the Executive shall serve on each such
board of directors without additional compensation in respect thereof.

1.3 Relocation. Except where the Company provides its written consent otherwise,
the Executive shall be required to (a) by no later than December 31, 2017,
establish a permanent residence for himself (and if applicable, his family) that
is within 75 miles of the Company Headquarters and (b) relocate his and his
family’s principal residence from that in effect as of the Effective Date to
such residence (or such other principal residence that is within 75 miles of the
Company Headquarters) by no later than the end of calendar year 2017.

2. Term of Employment.

The employment of the Executive under this Agreement shall commence on the
Effective Date and shall continue until the third anniversary of the Effective
Date (the “Initial Employment Period”), and shall automatically continue after
the end of the Initial Employment Period for additional, consecutive one-year
periods (each an “Extension Period”), unless (i) the Company notifies the
Executive in writing not less than one (1) year prior to, or the Executive
notifies the Company in writing not less than sixty (60) days prior to, the end
of the Initial Employment Period or the Extension Period, as applicable, of its
or the Executive’s election, in its or the Executive’s sole discretion, as
applicable, not to extend the Executive’s employment hereunder or
(ii) terminated earlier in accordance with Section 4 (any such period of
employment of the Executive with the Company, the “Employment Period”).

3. Compensation and General Benefits.

3.1 Base Salary.

(a) During the Employment Period, the Company shall pay to the Executive an
annual rate of base salary at least equal to $975,000 (such base salary, as may
be increased from time to time pursuant to Section 3.1(b), is referred to herein
as the “Base Salary”). The Executive’s Base Salary, less amounts required to be
withheld under applicable law, shall be payable in equal installments in
accordance with the Company’s normal payroll practices and procedures in effect
from time to time.

(b) The Board or the Compensation Committee established by the Board (the
“Compensation Committee”) shall review the Executive’s performance on an annual
basis and, based on such review, may change, by upward adjustment only, the Base
Salary, as it, acting in its sole discretion, shall determine to be reasonable
and appropriate.

 

 

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3.2 Bonuses.

(a) With respect to the 2017 calendar year and each subsequent calendar year
that commences during the Employment Period, the Executive shall be eligible to
earn an annual incentive bonus (the “Annual Bonus”), based on the achievement of
performance objectives established by the Board or the Compensation Committee
for the applicable year. The Executive’s target Annual Bonus shall be at least
150% of the then Base Salary, with the actual Annual Bonus amount earned
determined by the actual level of achievement of the relevant performance
objectives (for the 2017 calendar year, prorated consistent with the Executive’s
first day of employment). The Executive must be an employee in good standing on
the date when due to be paid in order to receive any Annual Bonus, except as
otherwise provided in Section 4.2, Section 4.3 or Section 4.4. Any Annual Bonus
earned shall be payable in full no later than March 15 of the year following the
year such bonus is earned. Notwithstanding anything herein to the contrary, the
Executive agrees that any Annual Bonus and any other incentive compensation
payable to the Executive under this Agreement or otherwise shall be subject to
any clawback policy adopted or implemented by the Company or GNC that is
mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act of
2010 or otherwise required by an applicable law, from time to time.

(b) Promptly following the Effective Date, the Company shall pay to the
Executive a cash relocation bonus in the amount of $100,000 (the “Relocation
Bonus”). The Executive and the Company each acknowledge that the Relocation
Bonus is being paid in lieu of any other benefits that would otherwise be
available to the Executive under the Company’s relocation policy for the
relocation described in Section 1.3. In the event the Executive is terminated
for Cause (as defined in Section 4.3(g)) or resigns without Good Reason (as
defined in Section 4.3(f)) prior to December 31, 2017 or fails to relocate
pursuant to Section 1.3 prior to December 31, 2017, the Executive shall
reimburse the Company for the net after-tax amount of the Relocation Bonus.

3.3 Expenses.

(a) The Executive shall be entitled to receive reimbursement from the Company
for all reasonable and necessary expenses incurred by the Executive in
performing the Executive’s duties hereunder on behalf of the Company, subject
to, and consistent with, the Company’s policies for expense payment and
reimbursement; provided, however, that the relocation policy applicable to
senior executive officers of the Company will not apply to the Executive’s
relocation described in Section 1.3.

(b) Promptly following the Effective Date, the Company shall pay, or reimburse
the Executive, for any legal fees and disbursements that the Executive may have
incurred in the negotiation of this Agreement, up to (in the aggregate) $25,000.

3.4 Benefits; Vacation. The Executive shall be entitled to participate in any
benefit plans, arrangements or policies made available by the Company to its
executive officers generally, subject to and on a basis consistent with the
terms, conditions and overall administration of each such plan, arrangement or
policy. In connection with the foregoing, the Executive shall be entitled to
four (4) weeks paid vacation annually, to be taken at such time(s) as shall not,
in the reasonable judgment of the Board, interfere with the Executive’s
fulfillment

 

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of his duties hereunder and otherwise in accordance with the Company’s policies
and procedures in effect from time to time, including the Company’s lawful
written policies and procedures with respect to the payment for or carryover of
accrued and unused vacation time. The Executive shall be entitled to as many
holidays, sick days and personal days as are provided by the Company from time
to time to its executive employees in accordance with the Company’s policies as
in effect from time to time.

3.5 Equity Awards.

(a) On the Effective Date, the Executive shall be granted an equity awards
package (collectively, the “Sign-on Awards”) in each case, pursuant to the Grant
Agreements (as defined below), to be granted as inducement grants on terms
consistent with those provided under the GNC Holdings, Inc. 2015 Stock and
Incentive Plan (the “Plan”): (i) fully vested restricted shares of GNC Holdings
common stock (“Restricted Shares”), with a grant date value of $600,000, which
shares the Executive shall not be entitled to dispose of until the earliest to
occur of: (x) a Change in Control (as defined in the Plan), (y) the third
anniversary of the Effective Date, or (z) the Executive’s death, Disability
(defined below) or any other separation from service from the Company;
(ii) unvested Restricted Shares with a grant date value of $950,000 (the “2017
Bonus Make-Whole Shares”), vesting on the last trading day of December 2017;
provided, however, that the Company will accelerate the vesting of such number
of 2017 Bonus Make-Whole Shares as may be necessary to cover the applicable
83(b) Election Tax Liability (defined below) in respect of any Sign-On Awards in
respect of which Executive chooses to recognize the value under Section 83(b) of
the Internal Revenue Code of 1986, as amended (the “Code”) (an “83(b)
Election”); (iii) unvested Restricted Shares with a grant date value of
$1,200,000 (the “LTI Make-Whole Shares”), vesting in three equal installments on
each of the first three anniversaries of the Effective Date, subject to the
Executive remaining employed with the Company on each anniversary and subject to
the provisions of Section 4; provided, however, that the Company will accelerate
the release of such number of LTI Make-Whole Shares as may be necessary to cover
the applicable 83(b) Election Tax Liability in respect of such shares; and
(iv) equity awards with a grant date value of $3,800,000, vesting in three equal
installments on each of the first three anniversaries of the Effective Date,
with 50% of the awards granted in the form of options using a Black-Scholes
value and the other 50% granted in the form of Restricted Shares. Each of the
forms of the grant agreements providing for the Sign-On Awards are attached to
this Agreement as Exhibits (the “Grant Agreements”).

(b) In 2018 executive shall receive, and for each subsequent year the Executive
shall be eligible to receive, annual equity grants, commensurate with his
position, at the same time as any other senior executives at the Company receive
annual equity grants, with the form(s) of such annual equity grants to be
determined by the Compensation Committee; provided, however, that (i) the
Executive’s 2018 annual equity grant(s) will have a total grant date value equal
to 450% of his Base Salary and (ii) any of the Executive’s 2018 annual equity
grant(s) that the Company would have granted in the form of restricted stock
units in the ordinary course of business shall instead be granted in the form of
Restricted Shares (the “2018 Restricted Shares”). In addition, notwithstanding
any vesting provisions that may otherwise be applicable to the 2018 Restricted
Shares, the Company will accelerate the release of such number of 2018
Restricted Shares as may be necessary to cover the applicable 83(b) Election Tax
Liability in respect of such shares.

 

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(c) For purposes of this Agreement, the term “83(b) Election Tax Liability”
means the amount of income and payroll tax withholding due in respect of any
Sign-On Awards or 2018 Restricted Shares, as applicable, for which the 83(b)
Election was made, with the number of shares of GNC Holdings common stock, the
vesting of which may become accelerated as provided above, being equal to
(x) the 83(b) Election Tax Liability, divided by (y) the Fair Market Value (as
defined in the Plan) of a share of GNC Holdings common stock on the date of such
acceleration.

4. Termination.

4.1 General. The employment of the Executive under this Agreement (and the
Employment Period) may be terminated in accordance with the provisions of this
Section 4.

4.2 Death or Disability of the Executive.

(a) The employment of the Executive hereunder (and the Employment Period) shall
terminate upon (x) the death of the Executive or (y) at the option of the
Company, upon not less than 15 days’ prior written notice to the Executive or
the Executive’s personal representative or guardian, if the Executive suffers a
“Total Disability” (as defined in Section 4.2(c)). Upon termination for death or
Total Disability, in addition to any benefits paid or payable to the Executive
or the Executive’s beneficiaries or estate under any Company-sponsored
disability benefit plan program or policy for the period following such date of
termination, the Company shall pay to the Executive, or the Executive’s
guardian, personal representative or estate, as applicable, (i) the Accrued
Obligations (as defined in Section 4.4(b)(i) and payable in accordance with the
terms thereof), (ii) any unpaid Annual Bonus with respect to the fiscal year
prior to the year in which the date of the Executive’s termination occurs (the
“Unpaid Prior Bonus”), and (iii) a prorated Annual Bonus that the Executive
would have been entitled to receive pursuant to Section 3.2 had the Executive
worked through the date of payment of such Annual Bonus, based on the actual
level of achievement of the performance objectives for the year of such
termination (with such proration based on the period of actual employment during
the applicable performance period, relative to the full performance period)(the
“Prorated Bonus”), with any such Annual Bonuses payable at the time and in the
manner annual bonuses are paid to employees, generally.

(b) Any payment under Section 4.2(a)(ii) and (iii) shall be paid on the first
regular payroll date following the 60th day after the Executive’s date of
termination (or, if later, the date provided in Section 3.2, if at the time of
the Executive’s date of termination the level of achievement of the performance
objectives referenced in Section 4.2(a)(ii) and/or (iii) has not yet been
established by the Board); and any vesting benefits under Section 4.2(d) shall
occur on the 60th day after the Executive’s date of termination; provided that,
in each case, on or before such date the Executive (or the Executive’s guardian,
personal representative or estate, as applicable) executes a Release (as defined
in Section 4.3(d)) and any period in which such Release may be revoked has
expired without revocation.

 

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(c) For purposes of this Agreement, “Total Disability” shall mean the definition
of “Disabled” contained in Section 409A of the Code and the regulations and
guidance promulgated thereunder (collectively “Code Section 409A”). In
conjunction with determining mental and/or physical disability for purposes of
this Agreement, the Executive hereby consents to (i) any examinations that the
Board or the Compensation Committee reasonably determines are relevant to a
determination of whether the Executive is mentally and/or physically disabled or
are required by the examining physician with the costs of such exam paid for by
the Company, (ii) furnish such medical information as may be reasonably
requested, and (iii) waive any applicable physician patient privilege that may
arise because of such examination; provided that in each case the Company takes
reasonable steps to protect the confidentiality of Executive’s situation and
condition.

(d) Notwithstanding anything contained in the Plan or any individual grant
agreements issued thereunder applicable to the Executive (collectively, the
“Equity Award Agreements”), all outstanding and unvested equity-based awards
granted under Equity Award Agreements and held by the Executive as of the date
of termination shall become vested as follows: (i) any such awards whose vesting
conditions are based solely on the Executive’s continued employment with the
Company over a period of time (the “Time-Vesting Awards”) shall become
immediately vested (and, as applicable, exercisable for such post-termination
period(s) as are already set forth in the Equity Award Agreements) on the date
of termination; and (ii) any such awards whose vesting conditions are based both
on the Executive’s continued employment with the Company over a period of time
and the Company’s achievement of pre-established performance targets (the
“Performance-Vesting Awards”) shall become vested as to a Prorated Target Amount
of such award on the date of termination. For purposes of this Section 4.2(d),
the “Prorated Target Amount” of each Performance-Vesting Award that shall become
vested hereunder shall be equal to the product of (x) a fraction, the numerator
of which is equal to the number of days in the performance period applicable to
such award during which the Executive was employed by the Company, and the
denominator of which is the total number of days during such performance period
(such fraction, the “Prorata Percentage”) and (y) the total number of shares of
GNC Holdings common stock subject to such Performance-Vesting Award to which the
Executive would have become entitled under such award, assuming achievement of
the performance targets applicable to such award at the “target” level of
performance as of the end of the performance period applicable to such award.

4.3 Termination by the Company Without Cause or Resignation by the Executive For
Good Reason or the Company’s Election Not to Extend the Employment Period.

(a) The Company may terminate the Executive’s employment without “Cause” (as
defined in Section 4.3(g)), and thereby terminate the Executive’s employment
(and the Employment Period) under this Agreement at any time with no requirement
for notice to the Executive. For the avoidance of doubt, the Company’s
non-renewal of the Term pursuant to Section 2 shall be treated as a termination
of the Executive’s employment by the Company without Cause.

 

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(b) The Executive may resign, and thereby terminate the Executive’s employment
(and the Employment Period), at any time for “Good Reason” (as defined in
Section 4.3(f)), upon not less than 30 days’ prior written notice to the Company
specifying in reasonable detail the circumstances constituting the asserted Good
Reason therefor; provided, however, that the Company shall have an opportunity
to cure any such Good Reason within 30 days after the Company’s receipt of such
notice; and provided further that, if the Company is not seeking to cure, the
Company shall not be obligated to allow the Executive to continue working during
such period and may, in its sole discretion, accelerate such termination of
employment (and the Employment Period) to any date during such period.

(i) The Executive may not terminate employment under this Agreement for Good
Reason on account of any act or omission by the Company, the first occurrence of
which the Executive had actual notice for 60 days or more prior to giving notice
of termination for Good Reason.

(ii) A resignation by the Executive for Good Reason requires the Executive to
actually resign his employment within 30 days after the Company’s cure period
has expired if the Company has failed to cure the event constituting Good
Reason.

(c) In the event the Executive’s employment is terminated pursuant to this
Section 4.3, and subject to Section 4.3(d), the following provisions shall
apply:

(i) The Company shall pay the Executive, as severance, a cash amount equal to
two times the sum of (A) the Executive’s Base Salary and (B) (i) if such
termination occurs prior to, or more than 24 months following, the date of a
Change in Control, the average of the Executive’s actual Annual Bonus paid in
respect of each of the two fiscal years immediately preceding the date of
termination (or, for any of the first two fiscal years of the Initial Term for
which an Annual Bonus has not yet been determined by the Board or its designated
committee, the Target Bonus) or (ii) if such termination occurs on the date of a
Change in Control or during the 24 months following a Change in Control, Target
Bonus, which amount shall be paid (x) if such termination occurs prior to, or
more than 24 months following, the date of a Change in Control, in substantially
equal installments accordance with the Company’s normal payroll practices and
procedures over the twenty-four (24) month period beginning on the 60th day
after the date of termination and (y) if such termination occurs on the date of
a Change in Control or during the 24 months following a Change in Control, in a
lump sum cash payment on the 60th day after the date of termination.
Notwithstanding the foregoing, if the Executive’s employment with the Company is
terminated by the Company as described in Section 4.3(a) and the date of such
termination occurs during the six-month period immediately preceding the date on
which a Change in Control occurs but after the date a definitive transaction
agreement is executed that contemplates such a Change in Control, then, for
purposes of this Section 4.3(c)(i), the Executive’s employment shall be deemed
to have been terminated immediately upon the date of the closing of the Change
in Control, with the amount that would have been payable pursuant
Section 4.3(c)(i)(B)(ii) in excess of that paid prior to the date of the Change
in Control under Section 4.3(c)(i)(B)(i) to be paid in substantially equal
installments over the balance of the severance period at the same time as the
payments made under Section 4.3(c)(i)(B)(i) are made.

 

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(ii) The Company shall pay to the Executive (A) the Unpaid Prior Bonus, if any,
and (B) the Prorated Bonus, if any, and with any such Annual Bonuses payable at
the time and in the manner annual bonuses are paid to employees, generally.

(iii) If the Executive timely elects continuation coverage (with respect to the
Executive’s coverage and/or any eligible dependent coverage) under the
Consolidated Omnibus Budget Reconciliation Act of 1986 (“COBRA Continuation
Coverage”) with respect to the Company’s group health insurance plan, the
Company shall be responsible for payment of the monthly cost of COBRA
Continuation Coverage, and the Executive shall make co-payments of the costs of
such coverage as if the Executive was an employee of the Company, such payments
for coverage to continue for the eighteen (18) month period following the date
of termination (or until such earlier date, if any, on which the Executive
obtains comparable health insurance coverage from another employer).

(iv) Notwithstanding anything contained in any Equity Award Agreements
applicable to the Executive or otherwise, unless otherwise agreed between the
Executive and the Company, all outstanding equity-based awards (including the
Sign-On Awards) granted under Equity Award Agreements and held by the Executive
as of the date of termination shall become vested as follows: (i) any Sign-On
Awards shall immediately vest; (ii) any Time-Vesting Awards other than any
Sign-On Awards shall, to the extent such Time-Vesting Awards would have become
vested in accordance with their terms within the twenty-four (24) month period
following the date of termination if the Executive had remained employed with
the Company through such period, become vested; and (iii) any such
Performance-Vesting Awards shall become vested as to a Prorated Actual Amount of
such award as of the date the Compensation Committee (or other committee, or the
Board) determines the Prorated Actual Amount. For purposes of this
Section 4.3(c)(iv), the “Prorated Actual Amount” of each Performance-Vesting
Award that shall become vested hereunder shall be determined following the
expiration of the performance period applicable to each such award, and shall be
equal to the product of (x) the Prorata Percentage of the applicable
Performance-Vesting Award and (y) the total number of shares of GNC Holdings
common stock subject to such Performance-Vesting Award (if any) to which the
Executive would have been entitled thereunder if the Executive had remained
employed through such applicable performance period, based on the actual
achievement of the performance targets applicable to such award, as determined
by the Compensation Committee (or other committee) otherwise in accordance with
the terms of the Plan and each such individual grant agreement.

(v) Payments and reimbursements made to the Executive under this
Section 4.3(c)(i), (ii), and (iii) shall be made or commence on the first
regular payroll date following the 60th day after the date of termination (or,
with respect to the payment provided under Section 4.3(c)(ii), if later, the
date provided in Section 3.2, if at the time of the Executive’s date of
termination the level of achievement of the performance objectives referenced in
Section 4.3(c)(ii)

 

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has not yet been established by the Board); and any vesting benefits under
Section 4.3(c)(iv) shall occur on the 60th day after the Executive’s date of
termination; provided that on or before such date the Release (as defined in
Section 4.3(d)) has been executed and any period in which the Executive may
revoke such Release has expired, without such Release having been revoked, and
provided, further, that the payment of all the amounts otherwise due to be paid
under Section 4.3(c)(i) shall be contingent on the Executive’s continued
compliance in all material respects with all post-termination restrictive
covenants applicable to the Executive contained in Section 5.

(d) As a condition precedent to the Executive’s right to receive the payments
and benefits set forth in Section 4.3(c)(i), (ii), (iii) and (iv), the Executive
agrees to execute a release in the form annexed hereto as Exhibit A (the
“Release”). The Company shall, without regard to the Executive’s execution of
the Release, pay the Executive the Accrued Obligations (payable in accordance
with the terms thereof).

(e) Anything in this Agreement to the contrary notwithstanding, if it shall be
determined that any payment, vesting, distribution or transfer by the Company or
any successor, or any Affiliate of the foregoing or by any other Person or that
any other event occurring with respect to the Executive and the Company for the
Executive’s benefit, whether paid or payable or distributed or distributable
under the terms of this Agreement or otherwise (including under any employee
benefit plan) (a “Payment”) would be subject to or result in the imposition of
the excise tax imposed by Section 4999 of the Code (defined below)
(collectively, the “Excise Tax”), then (subject to the proviso at the end of
this sentence) the amount of the Payment shall be reduced to the highest amount
that may be paid by the Company or other entity without subjecting any such
Payment to the Excise Tax (the “Payment Reduction”); provided, however, that the
Payments shall only be reduced if the Accounting Firm (as defined in
Section 4.3(e)(i) below) determines that the Executive would retain a greater
Net After-Tax Payment (defined below) of the Payments, if the Payments were to
be so reduced, than if the Payments were not so reduced. To the extent necessary
to effect the Payment Reduction, the Company shall reduce or eliminate the
Payments by first reducing or eliminating the portion of the Payments which are
not payable in cash and then by reducing or eliminating cash payments, in each
case in reverse order beginning with payments or benefits which are to be paid
the farthest in time from the initial determination, subject to the confirmation
of the Accounting Firm with respect to the intended effect of such Payment
Reduction. For purposes of this Agreement, the term “Net After-Tax Payment”
means the present value (as determined in accordance with Section 280G of the of
Internal Revenue Code of 1986, as amended (collectively with the regulations and
guidance promulgated thereunder, the “Code”)) of a Payment, net of all Excise
Taxes imposed on the Executive with respect to that Payment.

(i) Subject to the provisions of Section 4.3(e)(ii), all determinations required
to be made under this Section 4.3(e), including whether and when a Payment is
subject to Section 4999 of the Internal Revenue Code and the assumptions to be
utilized in arriving at such determination and in determining the amount of the
Net After-Tax Payment and, if applicable, an appropriate Payment Reduction,
shall be made by PricewaterhouseCoopers LLP, or any other nationally recognized
accounting firm that shall be the Company’s outside auditors

 

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at the time of such determination (the “Accounting Firm”), which Accounting Firm
shall provide detailed supporting calculations to the Executive and the Company
within 15 business days of the receipt of notice from the Company or the
Executive that there will be a Payment that the Person giving notice believes
may be subject to the Excise Tax. All fees and expenses of the Accounting Firm
shall be borne by the Company. Any determination by the Accounting Firm shall be
binding upon the Company and the Executive in determining whether a Payment
Reduction is required and the amount thereof (subject to Sections 4.3(e)(ii) and
(iii)), in the absence of material mathematical or legal error.

(ii) As a result of uncertainty in the application of Section 4999 of the Code
that may exist at the time of the initial determination by the Accounting Firm,
it may be possible that in making the calculations required to be made
hereunder, the Accounting Firm shall determine that a Payment Reduction was not
made that should be made (an “Overpayment”) or that a Payment Reduction was made
that need not be made (an “Underpayment”). If, within 75 days after the
Accounting Firm’s initial determination under Section (i), the Accounting Firm
shall determine that an Overpayment was made, any such Overpayment shall be
treated for all purposes, to the extent practicable and subject to applicable
law, as a loan to the Executive with interest at the applicable Federal rate
provided for in Section 1274(d) of the Code and shall be repaid by the Executive
to the Company within 35 days after the Executive receives notice of the
Accounting Firm’s determination; provided, however, that the amount to be repaid
by the Executive to the Company either as a loan or otherwise as a lump sum
payment (where a loan is not practicable or permitted by law) shall be reduced
to the extent that any portion of the Overpayment to be repaid shall not be
offset by a corresponding reduction in tax by reason of such repayment of the
Overpayment. If the Accounting Firm shall determine that an Underpayment was
made, any such Underpayment shall be due and payable by the Company to the
Executive within 35 days after the Company receives notice of the Accounting
Firm’s determination.

(iii) The Executive shall give written notice to the Company of any claim by the
Internal Revenue Service that, if successful, would require the payment by the
Executive of an Excise Tax, such notice to be provided within 15 days after the
Executive shall have received written notice of such claim. The Executive shall
cooperate with the Company in determining whether to contest or pay such claim
and shall not pay such claim without the written consent of the Company, which
shall not be unreasonably withheld, conditioned or delayed.

(iv) This Section 4.3(e) shall remain in full force and effect following the
termination of the Executive’s employment for any reason until the expiration of
the statute of limitations on the assessment of taxes applicable to the
Executive for all periods in which the Executive may incur a liability for taxes
(including Excise Taxes), interest or penalties arising out of the operation of
this Agreement.

 

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(f) For purposes of this Agreement, the Executive is entitled to terminate the
Executive’s employment for “Good Reason” if without the Executive’s prior
written consent:

(i) any material failure by the Company to comply with any material obligation
under this Agreement, including the failure to promptly provide any material
benefit hereunder;

(ii) (A) a reduction by the Company (including in the aggregate) of the
Executive’s titles, positions, status or authority (including, but not limited
to any change in reporting relationships) as the Chief Executive Officer of the
Company or (B) a material reduction by the Company (including in the aggregate)
of Executive’s responsibilities and duties (in either case of (A) or (B), other
than temporarily during any period where the Executive is incapacitated due to
physical or mental illness); or

(iii) other than by action of the Executive, removal of the Executive from the
position of Chief Executive Officer of the Company, or failure to elect (or
nominate) the Executive to, or removal other than for cause (as defined in the
governing documents of GNC Holdings) of the Executive from, the Board or the
Board of Directors of GNCI; or

(iv) the Company effects a reduction in the Executive’s Base Salary or Target
Bonus, other than any such reduction that applies to all executive officers as
part of a general reduction (as long as such reduction affecting the Executive
is no greater, on a percentage basis, than the reduction affecting any other
executive officer); or

(v) the Executive’s principal place of business for performing services to the
Company moves to a new location that is more than 75 miles from the Company
Headquarters.

(g) For purposes of this Agreement, “Cause” means the occurrence of any one or
more of the following events, and a determination of such occurrence shall be
made by the Board reasonably and in good faith by a two-thirds vote of the Board
(excluding the Executive as a member thereof) after a Board meeting to determine
the existence of Cause after reasonable written notice is received by the
Executive setting forth in reasonable detail the specific action or conduct of
Executive upon which the Board is relying in reaching its determination and a
reasonable opportunity for Executive (together with his counsel) to be heard by
the Board prior to such determination:

(i) any material failure by the Executive to comply with any material obligation
under this Agreement;

(ii) the Executive’s conviction of, or plea of nolo contendere to, (A) a
misdemeanor (other than traffic violations) that causes substantial actual
economic harm to the Company or any of its controlled Affiliates or (B) a crime
constituting a felony;

 

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(iii) intentional theft or embezzlement, or fraud by the Executive in connection
with the performance of the Executive’s duties hereunder;

(iv) the Executive’s engaging in any activity that gives rise to a material
conflict with the Company or any of its controlled Affiliates;1

(v) the intentional misappropriation by the Executive of any material business
opportunity of the Company or any of its controlled Affiliates;

(vi) any willful or reckless material failure to comply with, observe or carry
out the Company’s lawful written rules, regulations, policies and codes of
ethics and/or conduct applicable to its employees and senior executive officers
in effect from time to time and as to which Executive has received actual
notice, including (without limitation) those regarding conflicts, potential
conflicts of interest or the appearance of a conflict of interest;

(vii) (A) the Executive’s substance abuse that (I) significantly or persistently
impairs the Executive’s performance of the Executive’s duties hereunder or (II)
causes or is likely to cause substantial harm to the Company or any of its
controlled Affiliates, or (B) the Executive’s use of illegal drugs that
(x) impairs the Executive’s performance of the Executive’s duties hereunder or
(y) causes or is likely to cause substantial harm to the Company or any of its
controlled Affiliates; and

(viii) Intentional or reckless engagement in conduct that the Executive knows is
materially injurious to the Company or any of its controlled Affiliates;

; provided, that no determination of “Cause” by the Board as provided under any
of clauses (i), (iii), (iv) (v), (vi), or (vii) hereunder shall occur if such
act or conduct giving rise to a determination of “Cause” hereunder is cured
within thirty (30) days after delivery to the Executive by the Board of written
notice of such act or conduct. For the avoidance of doubt, a determination of
Cause in accordance with this Section shall not prevent the Executive from
challenging the Board’s determination (on a de novo review) that Cause exists or
that the Executive has failed to cure any act or conduct (or failure to act)
that purportedly formed the basis for the Board’s determination.

(h) For the avoidance of doubt, the election by the Executive not to extend or
further extend the Employment Period pursuant to Section 2 shall not be a
termination without Cause or a resignation for Good Reason under Section 4.3.

 

 

1  The executive will have the opportunity to cure.

 

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4.4 Termination For Cause, Voluntary Resignation Other Than For Good Reason or
Executive’s Election Not to Extend the Employment Period.

(a) (i) The Company may, only upon action of the Board and written notice to the
Executive specifying in reasonable detail the circumstances constituting the
occurrence of conduct or an event giving rise to the Executive’s termination for
Cause and compliance with the procedures set forth in Section 4.3(g), terminate
the employment of the Executive (and the Employment Period) at any time for
Cause, (ii) the Executive may voluntarily resign other than for Good Reason and
thereby terminate the Executive’s employment (and the Employment Period) under
this Agreement at any time upon not less than 60-days’ prior written notice or
(iii) the Executive may elect not to extend or further extend the Employment
Period pursuant to Section 2, provided that the Executive continues to provide
services hereunder through the end of the Employment Period.

(b) The following provisions shall apply upon termination by the Company for
Cause, by the Executive as the result of resignation for other than for Good
Reason, or by the Executive at the end of the Employment Period as the result of
the Executive’s election not to extend or further extend the Employment Period:

(i) The Executive shall be entitled to receive all amounts of earned but unpaid
Base Salary, accrued but unpaid vacation, and welfare and retirement benefits
accrued and vested through the date of such termination, and all business
expenses reimbursable under Section 3.3(a) incurred prior to the date of such
termination (the “Accrued Obligations”). Except as provided below, all other
rights of the Executive (and all obligations of the Company) hereunder shall
terminate as of the date of such termination. The Accrued Obligations shall be
paid in accordance with the Company’s general payroll practices and procedures
and the terms and conditions of any applicable plan.

(ii) The treatment of all outstanding stock options and other equity-based
awards held by the Executive as of the date of termination pursuant to this
Section 4.4 shall be governed by the terms of the Plan and the individual grant
agreements applicable to the Executive.

(iii) If the Employment Period is terminated by Executive as the result of an
election not to extend or further extend the Employment Period, the Company
shall pay to the Executive (A) the Unpaid Prior Bonus, if any, and (B) the
Prorated Bonus, if any, and with any such Annual Bonuses payable at the time and
in the manner annual bonuses are paid to employees, generally.

4.5 Resignation from Officer Positions. Upon the termination of the Executive’s
employment for any reason (unless otherwise agreed in writing by the Company and
the Executive), the Executive shall be deemed to have resigned, without any
further action by the Executive, from any and all officer and/or director
positions that the Executive, immediately prior to such termination, (a) held
with the Company or any of its controlled Affiliates and (b) held with any other
entities at the direction of, or as a result of the Executive’s affiliation
with, the Company or any of its controlled Affiliates. If for any reason this
Section 4.5 is deemed to be insufficient to effectuate such resignations, then
the Executive shall, upon the Company’s request, execute any documents or
instruments that the Company may reasonably deem necessary or desirable to
effectuate such resignations. In addition, the Executive hereby

 

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designates the Secretary or any Assistant Secretary of the Company and of any
controlled Affiliate to execute any such documents or instruments as the
Executive’s attorney-in-fact to effectuate such resignations if execution by the
Secretary or any Assistant Secretary of the Company or controlled Affiliate is
deemed by the Company or the controlled Affiliate to be a more expedient means
to effectuate such resignation or resignations.

5. Confidentiality, Work Product and Non-Competition and Non-Solicitation.

5.1 Confidentiality.

(a) In connection with the Executive’s employment with the Company, the Company
promises to provide the Executive with access to “Confidential Information” (as
defined in Section 5.4(d)) in support of the Executive’s employment duties. The
Executive recognizes that the Company’s business interests require a
confidential relationship between the Company and the Executive and the fullest
practical protection and confidential treatment of all Confidential Information.
At all times, both during and after the Employment Period, the Executive shall
not knowingly, whether directly or indirectly,: (i) appropriate, download,
print, copy, remove, use, disclose, divulge, communicate or otherwise
“Misappropriate” (as defined in Section 5.4(e)) any Confidential Information,
including, without limitation, originals or copies of any Confidential
Information, in any media or format, except for the benefit of a Company Party
within the course and scope of the Executive’s employment or with the prior
written consent of the Chairman of the Board; or (ii) take or encourage any
action that would circumvent, interfere with or otherwise diminish the value or
benefit of the Confidential Information to any of the Company Parties (as
defined in Section 5.4(b)).

(b) All Confidential Information, and all other Company information and property
affecting or relating to the business of the Company Parties within the
Executive’s possession, custody or control, regardless of form or format, shall
remain, at all times, the property of the respective Company Parties, the
appropriation, use and/or disclosure of which is governed and restricted by this
Agreement.

(c) The Executive acknowledges and agrees that:

(i) the Executive occupies a unique position within the Company, and the
Executive is and shall be intimately involved in the development and/or
implementation of Confidential Information[;

(ii) in the event the Executive intentionally breaches this Section 5.1 with
respect to any Confidential Information, such breach shall be deemed to be a
Misappropriation of such Confidential Information; and

(iii) any Misappropriation of Confidential Information shall result in immediate
and irreparable harm to the Company].

 

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(d) Upon receipt of any formal or informal request, by legal process or
otherwise, seeking the Executive’s direct or indirect disclosure or production
of any Confidential Information to any Person, the Executive shall, unless
limited by law or legal process, promptly and timely notify the Company and
provide a description and, if applicable, deliver a copy of such request to the
Company. The Executive irrevocably nominates and appoints the Company as the
Executive’s true and lawful attorney-in-fact to act in the Executive’s name,
place and stead to perform at the Company’s cost any act that the Executive
might perform to defend and protect against any disclosure of Confidential
Information.

(e) At any time the Company may reasonably request, during or after the
Employment Period, the Executive shall deliver to the Company all originals and
copies of Confidential Information and all other Company information and
property affecting or relating to the business of the Company Parties within the
Executive’s possession, custody or control, regardless of form or format,
including, without limitation any Confidential Information produced by the
Executive. Both during and after the Employment Period, the Company shall have
the right of reasonable access to review, inspect, copy and/or confiscate any
Confidential Information within the Executive’s possession, custody or control.

(f) Upon termination or expiration of this Agreement, the Executive shall
immediately return to the Company all Confidential Information, and all other
Company information and property affecting or relating to the business of the
Company Parties, within the Executive’s possession, custody or control,
regardless of form or format, upon the Company’s request.

(g) During the Employment Period and thereafter, the Executive represents and
agrees that the Executive shall not use or disclose any confidential or
proprietary information or trade secrets of others, including but not limited to
former employers, and that the Executive shall not bring onto the premises of
the Company or access such confidential or proprietary information or trade
secrets of such others, unless consented to in writing by said others, and then
only with the prior written authorization of the Company.

5.2 Work Product/Intellectual Property.

(a) The Executive hereby assigns to the Company all right, title and interest to
all “Work Product” (as defined in Section 5.4(h)) that (i) relates to any of the
Company Parties’ actual or anticipated business, research and development or
existing or future products or services, or (ii) is reduced to practice,
developed or made using any equipment, supplies, facilities, assets, information
or resources of any of the Company Parties (including, without limitation, any
intellectual property rights).

(b) The Executive shall promptly disclose Work Product to the Board and perform
all actions reasonably requested by the Company (whether during or after the
Employment Period) to establish and confirm at the Company’s cost the ownership
and proprietary interest of any of the Company Parties in any Work Product
(including, without limitation, the execution of assignments, consents, powers
of attorney, applications and other instruments). The Executive shall not file
any patent or copyright applications related to any Work Product except with the
written consent of the Chairman of the Board.

 

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5.3 Non-Competition and Non-Solicitation.

(a) In consideration of the Confidential Information being provided to the
Executive as stated in Section 5.1, and other good and valuable new
consideration as stated in this Agreement, including, without limitation, the
opportunity to earn an Annual Bonus, the opportunity to be awarded equity awards
pursuant to Section 3.5, employment and/or continued employment with the
Company, and the business relationships, Company goodwill, work experience,
client, customer and/or vendor relationships and other fruits of employment that
the Executive shall have the opportunity to obtain, use and develop under this
Agreement, the Executive agrees to the restrictive covenants stated in this
Section 5.3. The rights and obligations of the Parties under this Section 5.3
shall be binding upon and inure to the benefit of the Parties hereto and their
heirs, personal representatives, successors and permitted assigns.

(b) During the Employment Period and until the end of the Restricted Period (as
defined in Section 5.4(g)), the Executive agrees that the Executive shall not,
directly or indirectly, on the Executive’s own behalf or on the behalf of any
other Person (other than a Company Party), within the United States of America
or in any other country or territory in which the businesses of the Company are
conducted or from which the Executive could participate in a business that
competes with the business of the Company:

(i) engage in a Competing Business (as defined in Section 5.4(c)), including,
without limitation, by owning, managing, operating, controlling, being employed
by, providing services as a consultant or independent contractor to or
participating in the ownership, management, operation or control of any
Competing Business;

(ii) induce or attempt to induce any customer, vendor, supplier, licensor or
other Person in a business relationship with any Company Party, for or with
which the Executive or employees working under the Executive’s supervision had
any direct or indirect responsibility or contact at any time during the two most
recent years of the Executive’s employment with the Company, (A) to do business
with a Competing Business or (B) to cease, restrict, terminate or otherwise
reduce business with the Company for the benefit of a Competing Business,
regardless of whether the Executive initiates contact; or

(iii) (A) solicit, recruit, persuade, influence or induce, or attempt to
solicit, recruit, persuade, influence or induce anyone employed or otherwise
retained by any of the Company Parties (including any independent contractor or
consultant) at any time during the two most recent years of the Executive’s
employment with the Company, to cease or leave their employment or contractual
or consulting relationship with any Company Party, regardless of whether the
Executive initiates contact for such purposes or (B) hire, employ or otherwise
attempt to establish, for any Person, any employment, agency, consulting,
independent contractor or other business relationship with any Person who is or
was employed or otherwise retained by any of the Company Parties (including any
independent contractor or consultant) at any time during the two most recent
years of the Executive’s employment with the Company, regardless of whether the
Executive initiates contact for such purposes.

 

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(c) The Parties hereto acknowledge and agree that, notwithstanding anything in
Section 5.3(b)(i), (i) the Executive may own or hold, solely as passive
investments, securities of Persons engaged in any business that would otherwise
be included in Section 5.3(b)(i), as long as with respect to each such
investment the securities held by the Executive do not exceed five percent
(5%) of the outstanding securities of such Person and such securities are
publicly traded and registered under Section 12 of the Securities Exchange Act
of 1934, as amended, and (ii) the Executive may serve on the board of directors
(or other comparable position) or as an officer of any entity as consented to by
the Board (such consent not to be unreasonably withheld, delayed or
conditioned); provided, however, that in the case of investments otherwise
permitted under clause (i) above, the Executive shall not be permitted to,
directly or indirectly, participate in, or attempt to influence, the management,
direction or policies of (other than through the exercise of any voting rights
held by the Executive in connection with such securities), or lend the
Executive’s name to, any such Person.

(d) The Executive acknowledges and agrees that, for purposes of this
Section 5.3, indirect acts by the Executive shall include, without limitation,
an act by the Executive’s spouse, ancestor, lineal descendant, lineal
descendant’s spouse, sibling or other member of the Executive’s immediate
family, so long as such act was engaged in on behalf of, at the request of, with
the assistance of, the Executive, and so long as the Executive was otherwise
complicit in such act.

(e) The Executive acknowledges that (i) the restrictive covenants contained in
this Section 5.3 are ancillary to and part of an otherwise enforceable
agreement, such being the agreements concerning Confidential Information and
other consideration as stated in this Agreement, (ii) at the time that these
restrictive covenants are made, the limitations as to time, geographic scope and
activity to be restrained, as described herein, are reasonable and do not impose
a greater restraint than necessary to protect the goodwill and other legitimate
business interests of the Company, including without limitation, Confidential
Information (including trade secrets), client, customer and/or vendor
relationships, client and/or customer goodwill and business productivity,
(iii) in the event of termination of the Executive’s employment, the Executive’s
experiences and capabilities are such that the Executive can obtain gainful
employment without violating this Agreement and without the Executive incurring
undue hardship, (iv) based on the relevant benefits and other new consideration
provided for in this Agreement, including, without limitation, the disclosure
and use of Confidential Information, the restrictive covenants of this
Section 5.3, as applicable according to their terms, shall remain in full force
and effect even in the event of the Executive’s involuntary termination from
employment, with or without Cause and (v) the Executive has carefully read this
Agreement and has given careful consideration to the restraints imposed upon the
Executive by this Agreement and consents to the terms of the restrictive
covenants in this Section 5.3, with the knowledge that this Agreement may be
terminated at any time in accordance with the provisions hereof.

 

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5.4 Definitions. For purposes of this Agreement, the following terms shall have
the following meanings:

(a) An “Affiliate” of any specified Person means any other Person, whether now
or hereafter existing, directly or indirectly controlling or controlled by, or
under direct or indirect common control with, such specified Person. For
purposes hereof, “control” or any other form thereof, when used with respect to
any Person, means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and
“controlled” shall have meanings correlative to the foregoing. For the avoidance
of doubt, references in any section of this Agreement to “controlled affiliates”
or “controlled Affiliates” shall include, without limitation, franchisees of
GNCI and/or GNC Holdings.

(b) “Company Parties” means the Company, and its direct and indirect parents,
subsidiaries and controlled Affiliates, and their successors in interest.
Notwithstanding the foregoing, “Company Parties” shall not include Ares
Corporate Opportunities Fund II, L.P. or Ontario Teachers’ Pension Plan Board or
any other sponsor or their respective Affiliates other than the Company.

(c) “Competing Business” means, during the Employment Period and, as applicable,
on the date of any termination of the Executive’s employment hereunder, any
business in which any of the Company Parties is engaged or has during the last
three years of the Employment Period been engaged, including, without
limitation, any enterprise that engages in, owns or operates businesses that
market, sell, distribute, manufacture or otherwise are involved in the
nutritional supplements industry at the time of termination of the Executive’s
employment which currently includes Vitamin World, Vitamin Shoppe, Vitacost,
Nature’s Bounty, Bodybuilding.com, Vitamin Cottage, or any of their respective
controlled Affiliates or successors; provided that (1) the Executive may be
employed by or provide services to (i) (A) an ultimate parent company that
engages, directly or indirectly through a subsidiary, in a Competing Business,
so long as such ultimate parent company does not derive (on a consolidated
basis) more than 10% of its total gross revenues from such Competing Business or
(B) a subsidiary of an ultimate parent company that owns another subsidiary
which is engaged in a Competing Business, so long as such ultimate parent
company does not derive (on a consolidated basis) more than 30% of its total
gross revenues from the Competing Business of such other subsidiary; and (2) the
Executive demonstrates to the Company’s reasonable satisfaction (e.g. represents
and warrants to the Company in writing and describes the nature of the
Executive’s responsibilities at the parent company or the subsidiary, as
applicable) that the Executive does not and will not, directly or indirectly,
provide any services or advice to, have any responsibility for, or supervision
of, any business activities that materially engage in a Competing Business.

(d) Confidential Information.

(i) Definition. “Confidential Information” means any and all material,
information, ideas, inventions, formulae, patterns, compilations, programs,
devices, methods, techniques, processes, know how, plans (marketing, business,
strategic, technical or otherwise), arrangements, pricing and other data of or
relating to any of the Company Parties (as well as their customers and/or
vendors) that is confidential, proprietary or trade secret (A) by its nature,
(B) based on how it is reasonably treated or designated by a Company Party,
(C) because the disclosure of which would have a material adverse effect on the
business or planned business of any of the Company Parties and/or (D) as a
matter of law.

 

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(ii) Exclusions. Confidential Information does not include material, data,
and/or information (A) that any Company Party has voluntarily placed in the
public domain, (B) that has been lawfully and independently developed and
publicly disclosed by third parties, (C) that constitutes the general
non-specialized knowledge and skills gained by the Executive during the
Employment Period or (D) that enters the public domain other than by a breach of
this provision by Executive or is otherwise obtained through lawful means;
provided, however, that the unauthorized appropriation, use or disclosure of
Confidential Information by the Executive, directly or indirectly, shall not
affect the protection and relief afforded by this Agreement regarding such
information.

(iii) Inclusions. Subject to the exclusions described in Section 5.4(d)(ii) (for
the avoidance of doubt), Confidential Information includes, without limitation,
the following information (including without limitation, compilations or
collections of information) relating or belonging to any Company Party (as well
as its clients, customers and/or vendors) and created, prepared, accessed, used
or reviewed by the Executive during or after the Employment Period: (1) product
and manufacturing information, such as ingredients, combinations of ingredients
and manufacturing processes; (2) scientific and technical information, such as
research and development, tests and test results, formulae and formulations,
studies and analysis; (3) financial and cost information, such as operating and
production costs, costs of goods sold, costs of supplies and manufacturing
materials, non-public financial statements and reports, profit and loss
information, margin information and financial performance information;
(4) customer related information, such as customer related contracts, engagement
and scope of work letters, proposals and presentations, customer-related
contacts, lists, identities and prospects, practices, plans, histories,
requirements and needs, price information and formulae and information
concerning client or customer products, services, businesses or equipment
specifications; (5) vendor and supplier related information, such as the
identities, practices, history or services of any vendors or suppliers and
vendor or supplier contacts; (6) sales, marketing and price information, such as
marketing and sales programs and related data, sales and marketing strategies
and plans, sales and marketing procedures and processes, pricing methods,
practices and techniques and pricing schedules and lists; (7) database, software
and other computer related information, such as computer programs, data,
compilations of information and records, software and computer files,
presentation software and computer-stored or backed-up information including,
but not limited to, e-mails, databases, word processed documents, spreadsheets,
notes, schedules, task lists, images and video; (8) employee-related
information, such as lists or directories identifying employees, representatives
and contractors, and information regarding the competencies (knowledge, skill,
experience), compensation and needs of employees, representatives and
contractors and training methods; and (9)

 

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business- and operation-related information, such as operating methods,
procedures, techniques, practices and processes, information about acquisitions,
corporate or business opportunities, information about partners and potential
investors, strategies, projections and related documents, contracts and licenses
and business records, files, equipment, notebooks, documents, memoranda,
reports, notes, sample books, correspondence, lists and other written and
graphic business records.

(e) “Misappropriate”, or any form thereof, means:

(i) the acquisition of any Confidential Information by Executive, or from a
Person who he knows directly or indirectly acquired the Confidential
Information, by theft, bribery, misrepresentation, breach or inducement of a
breach of a duty to maintain secrecy or espionage through electronic or other
means (each, an “Improper Means”); or

(ii) the disclosure or use of any Confidential Information without the express
consent of the Company by Executive directly or through a Person who he knows
(A) used Improper Means to acquire knowledge of the Confidential Information,
(B) at the time of disclosure or use, knew that his or her knowledge of the
Confidential Information was (x) derived from or through a Person who had
utilized Improper Means to acquire it, (y) acquired under circumstances giving
rise to a duty to maintain its secrecy or limit its use or (z) derived from or
through a Person who owed a duty to the Company to maintain its secrecy or limit
its use or (C) before a material change of his or her position, knew that it was
Confidential Information and that knowledge of it had been acquired by accident
or mistake.

(f) “Person” means any individual, corporation, partnership, limited liability
company, joint venture, association, business trust, joint-stock company,
estate, trust, unincorporated organization, government or other agency or
political subdivision thereof or any other legal or commercial entity.

(g) “Restricted Period” means twenty-four (24) months after the date of
termination of employment (the Executive’s last day of work for the Company) for
any reason.

(h) “Work Product” means all patents and patent applications, all inventions,
innovations, improvements, developments, methods, designs, analyses, drawings,
reports, creative works, discoveries, software, computer programs,
modifications, enhancements, know-how, formulations, concepts and ideas, and all
similar or related information (in each case whether or not patentable), all
copyrights and copyrightable works, all trade secrets, confidential information,
and all other intellectual property and intellectual property rights that are
reduced to practice, developed or made by the Executive either alone or with
others in the course of employment with the Company.

 

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5.5 Remedies.

(a) Because the Executive’s services are unique and because the Executive has
access to Confidential Information, the Executive acknowledges and agrees that
if the Executive breaches any of the provisions of this Section 5, the Company
may suffer immediate and irreparable harm for which monetary damages alone will
not be a sufficient remedy and the Company may seek injunctive relief. The
restrictive covenants stated in this Section 5 are without prejudice to the
Company’s rights and causes of action at law. Notwithstanding anything contained
in this Agreement, in no event shall the Executive be prohibited from exercising
Executive’s legally protected “whistleblower” rights (including pursuant to Rule
21F under the Securities Exchange Act of 1934).

(b) In addition to the remedies provided in subsection (a), if the Executive
violates any provision of this Section 5, the Company may, after (i) giving
written notice to the Executive of the Board’s reasonable, good faith belief
that Executive has or is materially violating any of the covenants contained in
this Section 5 and (ii) giving the Executive 20 days in which to cease and cure
such violation, and the Executive fails to cease and desist from such violation
and/or does not cure such violation, immediately cease all payments that it may
be providing to the Executive pursuant to Section 4.3(c)(i) until such
activities are ceased and the violation cured; provided, however, that the
foregoing shall be in addition to such other remedies as may be available to the
Company and shall not be deemed to permit the Executive to forego or waive such
payments in order to avoid his or her obligations under this Section 5;
provided, further, that any Release previously executed by the Executive shall
continue in effect.

5.6 Interpretation; Severability.

(a) The Executive has carefully considered the possible effects on the Executive
of the covenants not to compete, the confidentiality provisions and the other
obligations contained in this Agreement, and the Executive recognizes that the
Company has made every effort to limit the restrictions placed upon the
Executive to those that are reasonable and necessary to protect the Company’s
legitimate business interests.

(b) The Executive acknowledges and agrees that the restrictive covenants set
forth in this Agreement are reasonable and necessary in order to protect the
Company’s valid business interests. It is the intention of the Parties hereto
that the covenants, provisions and agreements contained herein shall be
enforceable to the fullest extent allowed by law. If any covenant, provision or
agreement contained herein is found by a court having jurisdiction to be
unreasonable in duration, scope or character of restrictions, or otherwise to be
unenforceable, such covenant, provision or agreement shall not be rendered
unenforceable thereby, but rather the duration, scope or character of
restrictions of such covenant, provision or agreement shall be deemed reduced or
modified with retroactive effect to render such covenant, provision or agreement
reasonable or otherwise enforceable (as the case may be), and such covenant,
provision or agreement shall be enforced as modified. If the court having
jurisdiction shall not review the covenant, provision or agreement, the Parties
hereto shall mutually agree to a revision having an effect as close as permitted
by applicable law to the provision declared unenforceable. The Parties hereto
agree that if a court having jurisdiction determines, despite the express intent
of the Parties hereto, that any portion of the covenants, provisions or
agreements contained herein are not enforceable, the remaining covenants,
provisions and agreements herein shall be valid and enforceable. Moreover, to
the extent that any provision is declared unenforceable, the Company shall have
any and all rights under applicable statutes or common law to enforce its rights
with respect to any and all Confidential Information or unfair competition by
the Executive.

 

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5.7 Non-Waiver. The failure or delay of the Company at any time to require
performance by the Executive of any provision of this Section 5 or to seek
redress against the Executive or any other employee for any specific breach or
threatened breach of this Section 5, even if known, shall not by itself operate
or be construed as a waiver by the Company of its rights to require performance
of that provision or to exercise any right, power or remedy hereunder, and any
waiver by the Company of any breach of any provision of this Section 5 shall not
be construed as a waiver of the provision itself, or a waiver of any right,
power or remedy under this Agreement. No notice to or demand on the Executive in
any case shall, of itself, entitle the Executive to any other or further notice
or demand in similar or other circumstances other than as otherwise required in
this Section 5. This provision shall not be deemed to supersede the common law
of laches; nor shall it bar the defense of laches to application for equitable
remedies.

6. Insurance and Indemnification.

6.1 Insurance. In all policies of director and officer liability insurance, the
Executive shall be named as an insured in such a manner as to provide the
Executive substantially the same rights and benefits as are accorded to the
Company’s directors and executive officers.

6.2 Indemnification. The Company shall provide indemnification and advancement
of reasonable legal expenses to the Executive on terms and conditions and with
rights and benefits substantially the same as is provided from time to time by
the Company to its directors and executive officers, including through the
execution of the indemnification agreement executed as of the date hereof.

7. Miscellaneous.

7.1 Public Statements.

(a) Media Nondisclosure. The Parties agree that during the Employment Period or
at any time during the Restricted Period, except as may be authorized in writing
by the other, the Parties shall not release or solicit another to release to the
Media any information concerning or relating to any aspect of the Executive’s
termination from employment with the Company, and/or any aspect of any dispute
that may be the subject of this Agreement. For the purposes of this Agreement,
the term “Media” includes, without limitation, any news organization, station,
publication, show, website, web log (blog), bulletin board, chat room and/or
program (past, present and/or future), whether published through the means of
print, radio, television and/or the Internet or otherwise, and any member,
representative, agent and/or employee of the same. Nothing in this
Section 7.1(a) shall be construed to hinder any Party’s right to undertake
actions reasonably appropriate seeking legal redress with regard to any dispute;
nor shall this provision bar any release to the Media that responds to a broadly
disseminated publication of allegations or opinions that are harmful to the
responding Party’s reputation, or that is otherwise required by applicable law,
the Securities and Exchange Commission or the applicable rules of any national
exchange on which the securities of GNC Holdings or any Affiliate thereof is
traded.

 

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(b) Non-Disparagement. The Executive agrees that during the Employment Period
and Restricted Period, the Executive shall not make any statements, comments or
communications in any form, oral, written or electronic to any Media or any
customer, client or supplier of the Company or any of its Affiliates, which
would constitute libel, slander or disparagement of the Company or any of its
controlled Affiliates, including, without limitation, any such statements,
comments or communications that criticize, ridicule or are derogatory to the
Company or any of its controlled Affiliates; provided, however, that the terms
of this Section 7.1(b) shall not apply to communications between the Executive
and, as applicable, the Executive’s attorneys or other persons with whom
communications would be subject to a claim of privilege existing under common
law, statute or rule of procedure. The terms of this Section 7.1(b) shall also
not apply to communications made by the Executive pursuant to a legal obligation
of the Executive that is or may be disparaging of the Company or any of its
controlled Affiliates; provided that the Executive shall use reasonable best
efforts to notify the Company of such required disclosure in advance of being
required to make such disclosure, in order to allow the Company the opportunity
to prevent such disclosure. The Executive further agrees that the Executive
shall not in any way solicit any such disparaging statements, comments or
communications from others.

(c) The Company agrees and warrants that during the Employment Period and
Restricted Period: (i) the Company and its controlled Affiliates shall not issue
or publish any statements, comments or communications in any form, oral, written
or electronic, to any Media or any customer, client or supplier of the Company
or any of its Affiliates, (ii) the members of the Board and the executive
officers of the Company, in each case in the scope of their agency as, or in
their capacity as, representatives of the Company and its Affiliates, shall not
make any statements, comments or communications in any form, oral, written or
electronic to any Media or any customer, client or supplier of the Company or
any of its Affiliates, which would constitute libel, slander or disparagement of
the Executive; and (iii) the Company shall direct the members of all boards of
directors, officers and employees of the Company and its Affiliates not to make
any statements, comments or communications in any form, oral, written or
electronic to any Media or any customer, client or supplier of the Company or
any of its Affiliates, in any such case under Section 7.1(c)(i), (ii) or
(iii) which would constitute libel, slander or disparagement of the Executive,
including, without limitation, any such statements, comments or communications
that criticize, ridicule or are derogatory to the Executive; provided, however,
that the terms of this Section 7.1(c) shall not apply to any documents required
to be filed by the Company with the Securities and Exchange Commission, provided
that such disclosure is limited to only that which is required in order to
comply with the Company’s communications obligations thereunder and is limited
to only that which is required to be disclosed, or communications between the
Company and, as applicable, the Company’s attorneys or other persons with whom
communications would be subject to a claim of privilege existing under common
law, statute or rule of procedure. The terms of this Section 7.1(c) shall also
not apply to communications made by the Company or any of its Affiliates
pursuant to a legal obligation of the Company or any of its Affiliates, or that
is otherwise required by the applicable rules of any national exchange on which
the securities of GNC Holdings or any Affiliate thereof is traded, that is or
may be disparaging of the Executive; provided that the

 

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Company shall use reasonable best efforts to notify the Executive of such
required disclosure in advance of being required to make such disclosure, in
order to allow the Executive the opportunity to prevent such disclosure. The
Company further agrees that the Company and its officers, directors and
employees shall not in any way solicit any such disparaging statements, comments
or communications from others.

7.2 ARBITRATION. SUBJECT TO THE RIGHTS UNDER SECTION 7.3 TO SEEK INJUNCTIVE OR
OTHER EQUITABLE RELIEF, BINDING ARBITRATION SHALL BE THE EXCLUSIVE REMEDY FOR
ANY AND ALL DISPUTES, CLAIMS OR CONTROVERSIES, WHETHER STATUTORY, CONTRACTUAL OR
OTHERWISE, BETWEEN THE PARTIES HERETO ARISING UNDER OR RELATING TO THIS
AGREEMENT OR THE EXECUTIVE’S EMPLOYMENT BY OR TERMINATION FROM THE COMPANY
(INCLUDING, BUT NOT LIMITED TO, THE AMOUNT OF DAMAGES, OR THE CALCULATION OF ANY
BONUS OR OTHER AMOUNT OR BENEFIT DUE) (COLLECTIVELY, “DISPUTES”). THE PARTIES
EACH WAIVE THE RIGHT TO A JURY TRIAL AND WAIVE THE RIGHT TO ADJUDICATE THEIR
DISPUTES UNDER THIS AGREEMENT OUTSIDE THE ARBITRATION FORUM PROVIDED FOR IN THIS
AGREEMENT, EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT.

(a) Mediation First. In the event either Party provides a notice of arbitration
of any Dispute to the other Party, the Parties shall promptly proceed to make a
good-faith effort to settle the Dispute by agreement, in a full-day, non-binding
mediation with a mediator selected from a panel of mediators of JAMS. The
mediation will be governed by JAMS mediation procedures in effect at the time of
the mediation. The Company shall bear the costs for mediation, including the
mediator’s fees; provided, however, that the Parties shall each bear their own
individual costs and attorneys’ fees. If for any reason JAMS cannot serve as the
mediation administrator, the Company may, with the consent of Executive (not to
be unreasonably withheld, delayed or conditioned), select an alternative
mediation administrator, such as the American Arbitration Association (“AAA”),
to serve under the terms of this Agreement. The Executive may, but is not
required to, be represented by counsel in mediation. Any mediators proposed for
the panel provided for in this Section 7.2(a) must be available to serve in the
Agreed Venue (as defined in Section 7.2(e)).

 

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(b) Severability. It is the intention of the Parties hereto that the terms of
Section 7.2 of this Agreement and its subparts (the “Arbitration Provision”)
shall be enforceable to the fullest extent allowed by law. However, if any terms
of the Arbitration Provision are adjudicated to be invalid, illegal or
unenforceable, then the Parties hereby stipulate and agree that (i) the
adjudicating authority may and hereby is requested to modify the effect and/or
interpret such terms so that they become valid, legal and enforceable and are as
like the original terms as possible; (ii) such terms will not affect any other
terms of the Arbitration Provision or this Agreement; (iii) if for any reason
the terms in question cannot be modified or interpreted in accordance with this
subsection, then the Arbitration Provision will be reformed, construed and
enforced as if such terms never had been contained herein and/or have been
severed herefrom; (iv) such invalidity, illegality or unenforceability will not
take effect in any other jurisdiction absent a separate adjudication to that
effect; and (v) the remainder of this Agreement shall continue in full force and
effect.

(c) Procedure Generally. In the event that the Parties fail to settle at the
mediation required by this Agreement, the Parties agree to submit the Dispute to
a single arbitrator selected from a panel of JAMS arbitrators. The arbitration
will be governed by the JAMS Comprehensive Arbitration Rules and Procedures in
effect at the time the arbitration is commenced, subject to the terms and
modifications of this Agreement. If for any reason JAMS cannot serve as the
arbitration administrator or cannot fulfill the panel requirements of the
Arbitration Provision, the Company may, with the consent of Executive (not to be
unreasonably withheld, delayed or conditioned), select an alternative
arbitration administrator, such as AAA, using its rules and procedures to serve
under the terms of this Agreement.

(d) Arbitration Selection. To select the arbitrator, the Parties shall make
their respective strikes from a panel of former federal court judges, to the
extent available from JAMS (the “First Panel”). If the Parties cannot agree upon
an arbitrator from the First Panel or if such a panel is not available from
JAMS, then the Parties will next make their respective strikes from a panel of
former Pennsylvania state court trial and appellate judges, to the extent
available from JAMS (the “Second Panel”). Any arbitrators proposed for the First
and Second Panels provided for in this Section 7.2(d) must be available to serve
in the Agreed Venue. If the Parties cannot agree upon an arbitrator from the
Second Panel, or if such a panel is not available from JAMS, then the Parties
will next make their respective strikes from the panel of all other JAMS
arbitrators available to serve in the Agreed Venue.

(e) VENUE. THE PARTIES STIPULATE AND AGREE THAT THE EXCLUSIVE VENUE OF ANY SUCH
ARBITRATION PROCEEDING (AND OF ANY OTHER PROCEEDING, INCLUDING ANY COURT
PROCEEDING, UNDER THIS AGREEMENT) SHALL BE ALLEGHENY COUNTY, PENNSYLVANIA (THE
“AGREED VENUE”).

(f) Authority and Decision. The arbitrator shall have the authority to award the
same damages and other relief that a court could award. The arbitrator shall
issue a reasoned award explaining the decision and any damages awarded. The
arbitrator’s decision will be final and binding upon the Parties absent manifest
error (which shall only be corrected by the arbitrator) and enforceable by a
court of competent jurisdiction. The Parties will abide by and perform any award
rendered by the arbitrator. In rendering the award, the arbitrator shall state
the reasons therefor, including (without limitation) any computations of actual
damages or offsets, if applicable.

 

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(g) Fees and Costs. In the event of arbitration under the terms of this
Agreement, the fees charged by JAMS or other arbitration administrator and the
arbitrator shall be borne by the Company, subject to subsequent reallocation in
the determination of the arbitrator consistent with the JAMS rules and
regulations and to the extent permitted by law. Otherwise, the Parties shall
each bear their own costs, expenses and attorneys’ fees incurred in arbitration;
provided, however, that the prevailing Party shall be entitled to recover and
have awarded its attorneys’ fees, court costs, arbitration expenses, and its
portion of the fees and costs charged by JAMS or other arbitration
administrator, regardless of which Party initiated the proceedings, in addition
to any other relief to which it may be entitled. The Executive may, but is not
required to, be represented by counsel in arbitration.

(h) Limited Scope. The following are excluded from binding arbitration under
this Agreement: claims for workers’ compensation benefits or unemployment
benefits; replevin; and claims for which a binding arbitration agreement is
invalid as a matter of law.

7.3 Injunctive Relief. The Parties hereto may seek injunctive relief in
arbitration; provided, however, that as an exception to the arbitration
agreement set forth in Section 7.2, the Parties, in addition to all other
available remedies, shall each have the right to initiate an action in any court
of competent jurisdiction in order to request injunctive or other equitable
relief regarding the terms of Sections 5, 7.1 or 7.2. The exclusive venue of any
such proceeding shall be in the Agreed Venue. The Parties agree (a) to submit to
the jurisdiction of any competent court in the Agreed Venue and (b) to waive any
and all defenses it may have on the grounds of lack of jurisdiction of such
court. Evidence adduced in any such proceeding for an injunction may be used in
arbitration as well. The existence of this right shall not preclude or otherwise
limit the applicability or exercise of any other rights and remedies that a
Party hereto may have at law or in equity.

7.4 Settlement of Existing Rights. In exchange for the other terms of this
Agreement, the Executive acknowledges and agrees that: (a) the Executive’s entry
into this Agreement is a condition of employment and/or continued employment
with the Company, as applicable; and (b) the Executive is being provided with
access to Confidential Information, including, without limitation, proprietary
trade secrets of one or more Company Parties, to which the Executive has not
previously had access.

7.5 Entire Agreement; Waiver. This Agreement contains the entire agreement
between the Executive and the Company with respect to the subject matter hereof,
and supersedes any and all prior understandings or agreements, whether written
or oral. No modification or addition hereto or waiver or cancellation of any
provision hereof shall be valid except by a writing signed by the Party to be
charged therewith. No delay on the part of any Party to this Agreement in
exercising any right or privilege provided hereunder or by law shall impair,
prejudice or constitute a waiver of such right or privilege.

 

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7.6 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania, without regard to
principles of conflict of laws.

7.7 Successors and Assigns; Binding Agreement. The rights and obligations of the
Parties under this Agreement shall be binding upon and inure to the benefit of
the Parties hereto and their heirs, personal representatives, successors and
permitted assigns. This Agreement is a personal contract, and, except as
specifically set forth herein, the rights and interests of either Party herein
may not be sold, transferred, assigned, pledged or hypothecated by any Party
without the prior written consent of the others. As used herein, the term
“successor” as it relates to the Company, shall include, but not be limited to,
any successor by way of merger, consolidation or sale of all or substantially
all of such Person’s assets or equity interests.

7.8 Representation by Counsel; Independent Judgment; No Conflicts. Each of the
Parties hereto acknowledges that (a) it or the Executive has read this Agreement
in its entirety and understands all of its terms and conditions, (b) it or the
Executive has had the opportunity to consult with any individuals of its or the
Executive’s choice regarding its or the Executive’s agreement to the provisions
contained herein, including legal counsel of its or the Executive’s choice, and
any decision not to was the Executive’s or its alone and (c) it or the Executive
is entering into this Agreement of its or the Executive’s own free will, without
coercion from any source, based upon its or the Executive’s own independent
judgment. The Executive further represents that none of the entry by the
Executive into this Agreement and the Executive’s performance of duties
hereunder shall constitute a breach of any agreement to which the Executive may
be subject with any prior employer.

7.9 Interpretation. The Parties and their respective legal counsel actively
participated in the negotiation and drafting of this Agreement, and in the event
of any ambiguity or mistake herein, or any dispute among the Parties with
respect to the provisions hereto, no provision of this Agreement shall be
construed unfavorably against any of the Parties on the ground that the
Executive, it, or the Executive’s or its counsel was the drafter thereof.

7.10 Survival. The provisions of Sections 4.3(e), 5, 6 and 7 shall survive the
termination of this Agreement.

7.11 Notices. All notices and communications hereunder shall be in writing and
shall be deemed properly given and effective when received, if sent by facsimile
or telecopy, or by postage prepaid by registered or certified mail, return
receipt requested, or by other delivery service which provides evidence of
delivery, as follows:

If to the Company, to:

General Nutrition Centers, Inc.

300 Sixth Avenue

Pittsburgh, PA 15222

Attention: Chairman, Board of Directors

 

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with a copy to the Chief Legal Officer of the Company, at the same address.

If to the Executive, to:

the Executive, at the most recent address of the

Executive on file with the Company.

with copy to:

Russ Cashdan, Esq.

Hogan Lovells US LLP

1999 Avenue of the Stars, Suite 1400

Los Angeles, CA 90067

or to such other address as one Party may provide in writing to the other Party
from time to time.

7.12 Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original and all of which together shall
constitute one and the same instrument. Facsimile or electronic transmission of
any signed original document or retransmission of any signed facsimile or
electronic transmission will be deemed the same as delivery of an original. At
the request of any Party, the Parties will confirm facsimile or electronic
transmission by signing a duplicate original document.

7.13 Captions. Paragraph headings are for convenience only and shall not be
considered a part of this Agreement.

7.14 No Third Party Beneficiary Rights. No entity or person not a Party hereto
shall have any right to enforce any provision of this Agreement, even if
indirectly benefited by it.

7.15 Withholding. Any payments provided for hereunder shall be paid net of any
applicable withholding required under Federal, state or local law and any
additional withholding to which the Executive has agreed in writing.

7.16 Section 409A of the Code.

(a) Although the Company does not guarantee to the Executive any particular tax
treatment relating to the payments and benefits under this Agreement, it is
intended that such payments and benefits be exempt from, or comply with, Code
Section 409A, and all provisions of this Agreement shall be construed in a
manner consistent with the requirements for avoiding taxes or penalties under
Code Section 409A. The Parties mutually desire to avoid adverse tax consequences
associated with the application of Code Section 409A to this Agreement and agree
to cooperate fully and take appropriate reasonable actions to avoid any such
consequences under Code Section 409A, including delaying payments and reforming
the form of the Agreement (maintaining, to the maximum extent reasonably
possible, the original intent and economic benefit to the Executive and the
Company of the applicable provisions) if such action would reduce or eliminate
taxes and/or interest payable as a result of Code Section 409A. In addition,
Section 7.16 shall take precedence over any contrary terms in this Agreement.

 

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(b) A termination of employment shall not be deemed to have occurred for
purposes of any provision of this Agreement providing for the payment of any
amounts or benefits upon or following such termination of employment that are
considered “nonqualified deferred compensation” under Code Section 409A unless
such termination is also a “separation from service” within the meaning of Code
Section 409A and, for purposes of any such provision of this Agreement,
references to a “termination,” “termination of employment” or like terms shall
mean “separation from service.” If the Executive is deemed on the date of
termination to be a “specified employee” within the meaning of that term under
Code Section 409A(a)(2)(B), then with regard to any payment that is considered
“nonqualified deferred compensation” under Code Section 409A payable on account
of a “separation from service,” such payment or benefit shall be made or
provided at the date which is the earlier of (1) the expiration of the six-month
period measured from the date of such “separation from service” of the
Executive, and (2) the date of the Executive’s death (the “Delay Period”). Upon
the expiration of the Delay Period, all payments and benefits delayed pursuant
to this Section 7.16(b) (whether they would have otherwise been payable in a
single sum or in installments in the absence of such delay) shall be paid or
reimbursed to the Executive in a lump sum with interest at the prime rate as
published in The Wall Street Journal on the first business day following the end
of the Delay Period, and any remaining payments and benefits due under this
Agreement shall be paid or provided in accordance with the normal payment dates
specified for them herein.

(c) With regard to any provision herein that provides for reimbursement of costs
and expenses or in-kind benefits, except as permitted by Code Section 409A,
(i) the right to reimbursement or in-kind benefits shall not be subject to
liquidation or exchange for another benefit; (ii) the amount of expenses
eligible for reimbursement, or in-kind benefits, provided during any taxable
year shall not affect the expenses eligible for reimbursement, or in-kind
benefits to be provided, in any other taxable year, provided, that the foregoing
clause (ii) shall not be violated with regard to expenses reimbursed under any
arrangement covered by Section 105(b) of the Code solely because such expenses
are subject to a limit related to the period the arrangement is in effect; and
(iii) such payments shall be made on or before the last day of the Executive’s
taxable year following the taxable year in which the expense was incurred.

(d) If under this Agreement, an amount is to be paid in two or more
installments, for purposes of Code Section 409A, each installment shall be
treated as a separate payment. In no event may the Executive, directly or
indirectly, designate the calendar year of any payment to be made under this
Agreement that is considered nonqualified deferred compensation.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, the Parties have duly executed this Agreement, intending it
as a document under seal, to be effective for all purposes as of the Effective
Date.

 

WITNESS/ATTEST:     GENERAL NUTRITION CENTERS, INC. By:  

/s/ Gavin M. O’Connor

    By:  

/s/ Kevin G. Nowe

Name:  

VP & Chief Compliance Officer

    Title:  

SVP, Chief Legal Officer

WITNESS/ATTEST:     GNC HOLDINGS, INC. By:  

/s/ Gavin M. O’Connor

    By:  

/s/ Kevin G. Nowe

Name:  

VP & Chief Compliance Officer

    Title:  

SVP, Chief Legal Officer

WITNESS/ATTEST:     EXECUTIVE By:  

/s/ P. Seipe

    By:  

/s/ Ken Martindale

Name:  

Patti A. Seipe

    Title:  

Ken Martindale

 

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GENERAL RELEASE AND COVENANT NOT TO SUE

See attached Exhibit A

 

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EXHIBIT A                                

Form of Release for                    

Employment Agreement Exhibit

GENERAL RELEASE AND COVENANT NOT TO SUE

Reference is made to that certain Employment Agreement, dated as of [DATE]
between General Nutrition Centers, Inc. and GNC Holdings, Inc. (the “Company,”
and together with General Nutrition Centers, Inc., referred to herein as “GNC”)
and me, [name] (referred to herein as “I”) (such Employment Agreement as may
have been amended or otherwise modified from time to time in accordance with its
terms, the “Employment Agreement”). Capitalized terms used but not otherwise
defined in this General Release and Covenant Not to Sue (this “Release”) shall
have the meanings ascribed thereto in the Employment Agreement. For the
avoidance of doubt, references to “controlled Affiliates” or “controlled
affiliates” include, without limitation, franchisees of the Company and/or GNC.

1. Resignation. I, [name], hereby resign, retroactive to the date of the
termination of my employment, as an officer and director of GNC and any of their
controlled Affiliates and from any such positions held with any other entities
at the direction of, or as a result of my affiliation with, GNC or any of its
controlled Affiliates. I agree to promptly execute and deliver such other
documents as GNC shall reasonably request to evidence such resignations. In
addition, I hereby agree and acknowledge that the date of the termination of my
employment, as an officer and director of the Company, shall also be date of my
termination from all other offices, positions, trusteeships, committee
memberships and fiduciary capacities held with, or on behalf of, GNC or any of
its controlled Affiliates.

2. Confirmation of Termination. I acknowledge that, subject to the terms and
conditions of the Employment Agreement, the date of the termination of my
employment as an officer and director of the Company will serve as the
termination date of my employment for purposes of participation in and coverage
under all benefit plans and programs sponsored by or through GNC. I acknowledge
and agree that GNC shall not have any obligation to rehire me, nor shall GNC
have any obligation to consider me for employment, after the date of the
termination of my employment as an officer and director of the Company.

3. General Release and Waiver. I, [name], on behalf of myself and my heirs,
executors, administrators and assigns, in consideration of the Company’s
agreement to pay me the severance and other payments and benefits as more fully
described in the Employment Agreement in accordance with the terms and
conditions of the Employment Agreement, do hereby (except as expressly stated
herein) release and forever discharge and covenant not to sue (a) GNC and each
of its controlled Affiliates and their respective past, present and future
subsidiaries, divisions, controlled Affiliates and related business entities,
directors, officers, executives, members, agents, fiduciaries, trustees,
administrators, managers, supervisors, shareholders, investors, employees and
representatives and each of their respective successors and assigns (both
individually and in their official capacities) (collectively, the “Releasees”),
from any and all actions, causes of action, covenants, contracts, claims,
demands, suits, and liabilities whatsoever, which I ever had, now have or may
have arising prior to or on the effective date of this Release by reason of my
employment with or severance of my employment from the Company and/or its
controlled affiliates (“Claims”).

 

A-1

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By signing this Release, I am providing a complete waiver of all Claims that may
have arisen, whether known or unknown, up until and including the effective date
of this Release. This includes, but is not limited to, claims based on the Age
Discrimination in Employment Act of 1967, as amended, the Americans with
Disabilities Act of 1990, as amended, the Family and Medical Leave Act of 1993,
as amended, the Civil Rights Act of 1964, as amended, the Civil Rights Act of
1991, as amended, Section 1981 of the Civil Rights Act of 1866, as amended, the
Equal Pay Act, as amended, the Immigration Reform and Control Act of 1986, as
amended, the Employee Retirement Income Security Act of 1974, as amended
(excluding claims for accrued, vested benefits under any employee benefit or
pension plan of the released parties subject to the terms and conditions of such
plan and applicable law), the Sarbanes-Oxley Act of 2002, as amended, the
Pennsylvania Human Relations Act, as amended, the Pennsylvania Equal Pay Law, as
amended, or any other Federal, state, or local law, any common law, public
policy, contract (whether oral or written, express or implied) except as
expressly excluded below, or tort law, and any other local, state or Federal
law, regulation or ordinance having any bearing whatsoever on the terms and
conditions of my employment and the cessation thereof, provided, however, that
this Release shall not apply to (i) the Company’s obligations to provide me the
severance and other payments, equity, and benefits to which I am entitled under
the Employment Agreement in accordance with its terms and conditions, (ii) the
Company’s and/or its insurers’ obligation(s) to provide me indemnification,
defense, hold harmless, advancement or reimbursement of expenses to which I am
or would be entitled under applicable public law, the Company’s bylaws as in
effect as of the time of the underlying claim, any contract of insurance, or the
Employment Agreement, (iii) any vested, nonforfeitable benefits to which I may
be entitled pursuant to any employee benefit plan maintained by the Company from
time to time during my employment with the Company, (iv) claims for compensation
for injuries that are subject to and compensable solely under the Workers
Compensation Law, (v) any other right I have under, or any obligation of GNC or
any of its Affiliates to me under, the Employment Agreement which by its terms
survives termination, or (vi) any claim that cannot be waived as a matter of law
(collectively, “Excluded Claims”). This Release is not intended to interfere
with my right to file a charge with the Equal Employment Opportunity Commission
(“EEOC”) in connection with any claim I believe I may have against any Releasee.
Notwithstanding the preceding sentence, by executing this Release, I hereby
waive the right to recover in any proceeding I may bring before the EEOC or any
state human rights commission on my behalf. I further agree, promise and
covenant that, to the maximum extent permitted by law neither, I, nor any
person, organization, or other entity acting on my behalf has filed or will
file, charged or will charge, claimed or will claim, sued or will sue, or caused
or will cause or permitted or will permit to be filed, charged or claimed, any
action for damages or other relief (including injunctive, declaratory, monetary
or other relief) against the Releasees with respect to any Claims other than
Excluded Claims.

4. Knowing and Voluntary Waiver. (a) I have been afforded at least twenty-one
(21) days to review this Release and I acknowledge that GNC advises me to first
consult with legal counsel, and I am signing this Release knowingly, voluntarily
and with my own free will, and with full understanding of its terms and effects.
(b) I have had answered to my satisfaction any questions I have asked with
regard to the meaning and significance of all the terms and conditions of the
provisions of this Release and have not relied on any statements or explanations
made by any Releasee or their legal counsel. (c) I voluntarily accept the
severance and other payments and benefits to which I am entitled under the
Employment Agreement, for the purpose of making full and final settlement of all
Claims referred to above and agreeing to abide by the

 

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terms and conditions contained in this Release. (d) I also understand that I
have seven (7) days after my execution of this Release to revoke this Release,
and that this Release will not become effective if I exercise my right to revoke
my signature within seven (7) days of my execution of this Release. (e) I
understand that such revocation must be delivered in writing to the Chief Legal
Officer of the Company at its headquarters at: 300 Sixth Avenue, Pittsburgh, PA
15222, on or prior to 5:00 p.m. Eastern Standard Time (or Eastern Daylight Time,
as applicable) on the seventh (7th) day after I have signed this Release, in
order for such revocation to be effective.

5. Effective Time of Release. This Release, once signed (and dated on the date
signed) and returned to the Company by the date required under the Employment
Agreement at its headquarters at: 300 Sixth Avenue, Pittsburgh, PA 15222,
Attention: Chairman of the Board, shall be effective on the eighth (8th) day
after this Release is signed.

6. Governing Law. This Release will be governed by and construed in accordance
with the laws of the Commonwealth of Pennsylvania. If any provision in this
Release is held invalid or unenforceable for any reason, the remaining
provisions shall be construed as if the invalid or unenforceable provision had
not been included.

IN WITNESS WHEREOF, I have executed this Release on this             day of
            , 2            .

[NAME]

 

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FORM OF RESTRICTED STOCK AWARD AGREEMENT

See attached Exhibit B.

 

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FORM OF OPTION AWARD AGREEMENT

See attached Exhibit C.