Exhibit 10.2

Execution Version

COOPERATION AGREEMENT

This Cooperation Agreement, dated April 20, 2018 (this “Agreement”), is by and
among Vitamin Shoppe, Inc. (the “Company”) and the entities and natural Persons
set forth on Exhibit A hereto (collectively, “Vintage Capital”).

WHEREAS, a member of Vintage Capital has nominated certain individuals for
election as directors at the Company’s 2018 annual meeting of stockholders (the
“2018 Annual Meeting”);

WHEREAS, Vintage Capital Beneficially Owns (as defined below) shares of common
stock of the Company, par value $0.01 per share (the “Common Shares”), totaling
3,587,255 Common Shares, or approximately 14.8% of the outstanding Common Shares
as of the date hereof;

WHEREAS, on March 19, 2018, Vintage Capital and Shah Capital Management, Inc.
and certain of its Affiliates (collectively, “Shah Capital”) jointly filed a
Schedule 13D (the “Schedule 13D”) with the Securities and Exchange Commission
(the “SEC”) disclosing the formation a “group” among Vintage Capital and Shah
Capital (the “13D Group”) for the purpose of, among other things, seeking
representation on the Company’s board of directors (the “Board”), and reporting
aggregate beneficial ownership of 7,707,255 Common Shares, or approximately
31.8% of the outstanding Common Shares as of the date hereof;

WHEREAS, Vintage Capital and the Company have determined to come to an agreement
with respect to the composition of the Board and certain related matters; and

WHEREAS, concurrent with the execution of this Agreement, Shah Capital and the
Company are entering into a Cooperation Agreement with respect to the
composition of the Board and certain related matters (the “Shah Cooperation
Agreement”).

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:

1.    Board Representation and Board Matters.

(a)    Vintage Capital hereby irrevocably withdraws the Nomination Notice (as
defined below) with immediate effect. Vintage Capital shall immediately cease
all solicitation efforts in connection with the 2018 Annual Meeting. Vintage
Capital shall not file with the SEC, or mail or otherwise deliver to the
Company’s stockholders, any proxy statement or proxy card in respect of the 2018
Annual Meeting.

(b)    The Company will, as promptly as practicable, take all action necessary
to increase the size of the Board by up to five directors to up to 15 directors
such that there would be up to five vacancies on the Board and appoint
(i) Melvin L. Keating (the “Vintage Designee”) (it being understood that the
Vintage Designee will be appointed to the Board within five days of the date of
this Agreement); (ii) pursuant to and in accordance with the Shah Cooperation

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Agreement, Himanshu Shah and Sing Wang (the “Shah Designees”) (it being
understood that the Shah Designees will be appointed to the Board within five
days of the date of this Agreement); (iii) one independent director (who shall
not be a current employee of, and shall not have been an employee (within one
year prior to the date of being designated hereunder) of, Vintage Capital or
Shah Capital or any of their Affiliates (collectively, the “Applicable
Criteria”)) to be proposed by the Company and reasonably acceptable to Shah
Capital and Vintage Capital (the “Company Designee”) (it being understood that
the Company Designee will be appointed to the Board within five business days of
the later of the agreement of such person to serve as a director and such person
being determined to be acceptable); and (iv) one independent director who shall
satisfy the Applicable Criteria and shall be mutually acceptable to Vintage
Capital, Shah Capital and the Company (the “Independent Designee” and, together
with the Vintage Designee, the Shah Designees and the Company Designee, the “New
Directors”) (it being understood that the Independent Designee will be appointed
to the Board within five business days of the later of the agreement of such
person to serve as a director and such person being determined to be acceptable)
to fill the five newly created vacancies. If, despite the parties’ good faith
efforts to identify the Company Designee or the Independent Designee, either
such director has not been identified and approved prior to the filing of the
Company’s definitive proxy statement for the 2018 Annual Meeting, such director
shall be appointed immediately following the 2018 Annual Meeting or as promptly
as practicable thereafter once such director is identified and approved in good
faith in accordance with the terms of this Agreement.

(c)    Notwithstanding Section 1(b), the Board, following the appointment of the
Vintage Designee and the Shah Designees, will consider not appointing the
Company Designee and/or the Independent Designee. If the Board makes such a
determination, the term New Directors shall include only the Vintage Designee
and the Shah Designees and all references to the size of the Board and the
number of directors in this Agreement shall be reduced by up to two directors,
as applicable.

(d)    Subject to the exception in the last sentence of Section 1(b) regarding
the Company Designee and the Independent Designee, the Company’s slate of
nominees for election as directors of the Company at the 2018 Annual Meeting and
the Company’s 2019 annual meeting of stockholders (the “2019 Annual Meeting”)
shall include the New Directors (or any respective Replacements thereof). The
Company will use reasonable best efforts to cause the election of the New
Directors (or any respective Replacements thereof) to the Board at the 2018
Annual Meeting and 2019 Annual Meeting (including, in each case, recommending
that the Company’s stockholders vote in favor of the election of the New
Directors (or any respective Replacements thereof) (along with all of the
Company’s other nominees) and otherwise supporting the New Directors (and any
respective Replacements thereof) for election in a manner no less rigorous and
favorable than the manner in which the Company supports its other nominees). At
the 2018 Annual Meeting, the only matters to appear on the agenda of the meeting
will be: (1) the election of directors; (2) an advisory and non-binding vote to
approve named executive officer compensation; (3) the approval of the Company’s
2018 Long-Term Incentive Plan; (4) the amendment and restatement of the
Company’s 2010 Employee Stock Purchase Plan; and (5) the ratification of the
appointment of Deloitte & Touche LLP as independent registered public accounting
firm of the Company.

 

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(e)    Upon the resignation of Colin Watts, the current Chief Executive Officer
of the Company, the Company shall cause Mr. Watts to resign from the Board and
all committees thereof, and the Company shall immediately reduce the size of the
Board by one director. Upon the appointment of a successor Chief Executive
Officer, the Company will increase the size of the Board by one director, and
will appoint the successor Chief Executive Officer to the Board.

(f)    The Company shall hold the 2018 Annual Meeting not later than June 30,
2018. At the 2018 Annual Meeting, four of the directors serving on the Board on
the date hereof (other than the Chief Executive Officer or the New Directors)
shall not be nominated for re-election as directors by the Company. After the
2018 Annual Meeting and prior to the completion of the 2019 Annual Meeting, the
Board shall not increase the size of the Board to more than 11 directors.

(g)    Should the Vintage Designee resign from the Board or become unable to
serve on the Board for any reason before the completion of the 2019 Annual
Meeting, Vintage Capital will have the right to appoint to the Board a
replacement director (a “Replacement”) who shall meet the Applicable Criteria
and be reasonably acceptable to the Board.

(h)    Should either the Company Designee or the Independent Designee resign
from the Board or become unable to serve on the Board for any reason before the
completion of the 2019 Annual Meeting, Vintage Capital, Shah Capital and the
Company shall mutually agree on a Replacement who shall meet the Applicable
Criteria.

(i)    The appointment of a Replacement will be subject to a customary due
diligence process by the Board (including the review of a completed D&O
questionnaire (in the Company’s standard form), interviews with members of the
Board (if requested) and a customary background check). The Company will use its
reasonable best efforts to complete its approval process as promptly as
practicable and in any event within 10 business days following receipt of all
necessary information and conclusion of interviews. Except as otherwise
specified in this Agreement, upon the appointment to the Board of a Replacement
for the Vintage Designee, all references in this Agreement to the term “Vintage
Designee” will include such Replacement.

(j)    Each New Director will be entitled to the same director benefits as other
members of the Board, including (i) compensation for his or her service as a
director and reimbursement for his or her expenses on the same basis as all
other non-employee directors of Company; (ii) equity-based compensation grants
and other benefits, if any, on the same basis as all other non-employee
directors of Company; and (iii) the same rights of indemnification and
directors’ and officers’ liability insurance coverage as the other non-employee
directors of Company as such rights may exist from time to time.

(k)    Notwithstanding anything to the contrary in this Agreement, no New
Director, during his or her service as a director of Company, will be prohibited
from acting in his or her capacity as a director or from complying with his or
her fiduciary duties as a director of Company (including voting on any matter
submitted for consideration by the Board, participating in deliberations or
discussions of the Board, and making suggestions or raising any issues or
recommendations to the Board).

 

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(l)    Prior to the appointment of the New Directors, the Board will take all
action necessary to determine that each New Director is deemed to be (i) a
member of the “incumbent board” (or similar term) for purposes of the Company’s
contracts and agreements; and (ii) a member of the Board as of the beginning of
any applicable two-year measurement period for the purposes of any applicable
“change of control” (or similar term) concept in the Company’s contracts and
agreements.

(m)    Effective immediately upon the execution of this Agreement, Vintage
Capital and Shah Capital hereby dissolve the 13D Group and shall promptly file
an amendment to the Schedule 13D that dissolves the 13D Group (the “Dissolution
13D”).

2.    Certain Other Matters.

(a)    For purposes of this Agreement, the “Standstill Period” shall mean the
period from the date of this Agreement until 12:01 a.m., Eastern time, on the
15th business day prior to the advance notice deadline for making director
nominations (as calculated pursuant to the Company’s bylaws in effect on the
date of the Agreement) at the Company’s 2020 annual meeting of stockholders (the
“2020 Annual Meeting”).

(b)    During the Standstill Period, no member of Vintage Capital shall,
directly or indirectly:

(i)    (A) nominate, give notice of an intent to nominate, or recommend for
nomination a person for election at any meeting of the Company’s stockholders at
which directors are to be elected, it being understood that nothing in this
Agreement will prevent Vintage Capital or its Affiliates from taking actions in
furtherance of identifying director candidates in connection with the 2020
Annual Meeting so long as such actions do not create a public disclosure
obligation for Vintage Capital or the Company, are not publicly disclosed by
Vintage Capital and are undertaken on a basis reasonably designed to be
confidential and in accordance in all material respects with Vintage Capital’s
normal practices in the circumstances; (B) initiate, encourage or participate in
any solicitation of proxies in respect of any election contest with respect to
the Company’s directors; (C) submit any stockholder proposal (pursuant to Rule
14a-8 under the Exchange Act or otherwise) for consideration at, or bring any
other business before, any meeting of the Company’s stockholders; (D) initiate,
encourage or participate in any solicitation of proxies in respect of any
stockholder proposal for consideration at, or bring any other business before,
any meeting of the Company’s stockholders; (E) initiate, encourage or
participate in any “withhold” or similar campaign with respect to any meeting of
the Company’s stockholders or any solicitation of written consents of the
Company’s stockholders; (F) request, or initiate, encourage or participate in
any request to call, a special meeting of the Company’s stockholders; or
(G) seek, alone or in concert with others, to amend any provision of the
Company’s certificate of incorporation or bylaws;

(ii)    with respect to the Company, knowingly encourage, advise or influence
any other Person or assist any other Person in so knowingly encouraging,
assisting or influencing any Person with respect to the giving or withholding of
any proxy, consent or other authority to vote or in conducting any type of
referendum (other than such encouragement, advice or influence that is
consistent with the Company’s recommendation in connection with such matter);

 

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(iii)    other than solely with other members of Vintage Capital and their
Affiliates, (A) form or join in a partnership, limited partnership, syndicate or
other group, including a “group” as defined under Section 13(d) of the Exchange
Act, with respect to the Voting Securities (including any group with Shah
Capital and its Affiliates) or (B) deposit any securities of the Company into a
voting trust, or subject any securities of the Company to any agreement or
arrangement with respect to the voting of such securities (other than delivering
to the Company or its designee a proxy in connection with a solicitation made by
or on behalf of the Company);

(iv)    make any request for stockholders list materials or other books and
records of the Company under Section 220 of the Delaware General Corporation Law
or otherwise;

(v)    institute, solicit or join, as a party, any litigation, arbitration or
other proceeding (including any derivative action) against the Company or any of
its future, current or former directors or officers or employees; provided, that
nothing shall prevent any member of Vintage Capital from (A) bringing litigation
to enforce the provisions of this Agreement; (B) making counterclaims with
respect to any proceeding initiated by, or on behalf of, the Company against
Vintage Capital; (C) bringing bona fide commercial disputes that do not relate
to the subject matter of this Agreement; (D) complying with a validly issued
legal process; or (E) exercising statutory appraisal rights;

(vi)    make any public recommendation or other public statement with respect to
mergers, acquisitions or other business combinations or extraordinary
transactions involving the Company (“Extraordinary Transactions”) or solicit or
knowingly encourage any third party to make an offer or proposal with respect to
any Extraordinary Transaction (or to refrain from doing so);

(vii)    enter into any negotiations, agreements, arrangements or understandings
with any other Person with respect to the matters set forth in this
Section 2(b); or

(viii)    contest the validity of, or publicly request any waiver of, the
obligations set forth in this Section 2(b).

The restrictions set forth above in this Section 2(b) shall not apply for the
duration of any period that the Company is not in material compliance with its
obligations under Section 1 and Section 18 after written notice of such material
non-compliance has been provided to the Company and the Company has been given a
reasonable opportunity to cure such material non-compliance; provided that such
notice and opportunity to cure shall not apply in the case of material
noncompliance with Section 1.

(c)    At the 2018 Annual Meeting and the 2019 Annual Meeting, and at any
meeting of stockholders held prior to the expiration of the Standstill Period,
Vintage Capital shall cause all Voting Securities that are Beneficially Owned by
it (i) to be present for purposes of establishing a quorum and (ii) to be voted
in favor of the election of all director candidates nominated by the

 

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Board and otherwise in accordance with the Board’s recommendation, including in
favor of each other matter recommended for stockholder approval by the Board;
provided, that solely with respect to any meeting after the 2018 Annual Meeting,
Vintage Capital may vote such Voting Securities in its sole discretion on each
matter other than proposals relating to the election of directors (for which
Vintage Capital shall vote as recommended by the Board).

(d)    If at any time following the date of this Agreement, Vintage Capital’s
aggregate Net Long Position in the Common Shares is less than 5% of the
then-outstanding Common Shares (the “Minimum Ownership Level”), (i) Vintage
Capital shall lose its right to identify the Vintage Designee (and his/her
Replacement), (ii) the Company shall not be obligated to appoint the Vintage
Designee, (iii) the Company shall not be obligated to nominate the Vintage
Designee (or any respective Replacement) for election to the Board at any
meeting of stockholders at which directors are to be elected occurring after the
time at which Vintage Capital no longer satisfies the Minimum Ownership Level
and (iv) the Vintage Designee (or any respective Replacement) shall, if
requested by the Board, immediately resign from the Board and all committees
thereof. Prior to appointment to the Board, each Vintage Designee and any
Replacement shall execute an irrevocable resignation pursuant to which, if such
resignation is requested, such person shall resign at such time at which Vintage
Capital no longer satisfies the Minimum Ownership Level.

(e)    The Company shall publicly issue its financial results for the first
quarter of 2018 no later than May 9, 2018.

3.    Additional Agreements. The parties hereby agree to the matters set forth
on Schedule A.

4.    Non-Disparagement. During the Standstill Period, Vintage Capital and the
Company agree not to make, or cause to be made (whether directly or indirectly),
any statement or announcement that relates to and constitutes an ad hominem
attack on, or relates to and otherwise disparages, the other party or their
respective business, operations or financial performance, officers or directors
or any Person who has served as an officer or director of either party in the
past, or who serves on or following the date of this Agreement as an officer,
director or agent of either party (a) in any document or report filed with or
furnished to the SEC or any other governmental agency, (b) in any press release
or other publicly available format or (c) to any stockholder, investor, analyst,
journalist or member of the media (including in a television, radio, internet,
newspaper or magazine interview). This Section 4 will not apply to any statement
made in connection with any action to enforce this Agreement. Notwithstanding
the foregoing, any private statement made by Vintage Capital regarding the
Company’s operational or stock price performance or any strategy, plans or
proposal of the Company, that do not disparage any of the Company’s officers,
directors or agents and that would not reasonably be likely to result in a
required public disclosure by any person (“Opposition Statements”) will not be
deemed to be a breach of this Section 4, except that any Opposition Statement
will only speak to a matter that has been made public by the Company. The
Company will be permitted to respond with a private statement similar in scope
to any Opposition Statement.

5.    Public Announcements. Promptly following the execution of this Agreement,
the Company shall announce this Agreement by means of a press release in the
form attached hereto

 

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as Exhibit B (the “Press Release”). Neither the Company nor Vintage Capital
shall make or cause to be made any public announcement or statement with respect
to the subject of this Agreement that is contrary to the statements made in the
Press Release, except as required by law or the rules of any stock exchange (in
each case as long as the requirement to make such disclosure does not arise from
the disclosing party’s breach of this Agreement) or with the prior written
consent of the other party. The Company acknowledges that Vintage Capital
intends to file this Agreement as an exhibit to the Dissolution 13D. The Company
shall have reasonable advance review and consultation rights upon any Schedule
13D filing (or amendment thereto) made by Vintage Capital with respect to this
Agreement. Vintage Capital acknowledges and agrees that the Company intends to
file this Agreement and file or furnish the Press Release with the SEC as
exhibits to a Current Report on Form 8-K and to file this Agreement as an
exhibit to future filings with the SEC. Vintage Capital shall have reasonable
advance review and consultation rights upon any Form 8-K filing (or amendment
thereto) made by the Company with respect to this Agreement.

6.    Representations and Warranties of All Parties. Each of the parties
represents and warrants to the other party that: (a) such party has all
requisite power and authority to execute and deliver this Agreement and to
perform its obligations hereunder; (b) this Agreement has been duly and validly
authorized, executed and delivered by it and is a valid and binding obligation
of such party, enforceable against such party in accordance with its terms
(subject to applicable bankruptcy and similar laws relating to creditors’ rights
and to general equity principles); and (c) this Agreement will not result in a
violation of any terms or conditions of any agreements to which such Person is a
party or by which such party may otherwise be bound or of any law, rule,
license, regulation, judgment, order or decree governing or affecting such
party.

7.    Representations and Warranties of Vintage Capital. Each member of Vintage
Capital severally and not jointly represents and warrants that, as of the date
of this Agreement: (a) Vintage Capital Beneficially Owns an aggregate of
3,587,255 Common Shares; and (b) Vintage Capital has not provided or agreed to
provide, and will not provide, any compensation in cash or otherwise to any New
Director in his or her capacity as a director or director nominee of the Company
in connection with such New Director’s nomination and appointment to, or service
on, the Board.

8.    Responsible Parties. Vintage Capital shall cause its controlled
Affiliates, agents and other Persons acting on its behalf to comply with the
terms of this Agreement. The Company shall cause its directors, officers and
controlled Affiliates to comply with the terms of this Agreement. Each of
Vintage Capital and the Company shall be responsible for any breach of the terms
of this Agreement by such Persons, as applicable.

9.    Certain Defined Terms. For purposes of this Agreement:

(a)    “Affiliate” has the meaning set forth in Rule 12b-2 promulgated by the
SEC under the Exchange Act. The Vintage Designee shall not be considered an
Affiliate of Vintage Capital.

(b)    “Beneficial Ownership” of Voting Securities means ownership of (i) Voting
Securities and (ii) rights or options to own or acquire any Voting Securities
(whether such right or option is exercisable immediately or only after the
passage of time or upon the satisfaction of one or more conditions (whether or
not within the control of such Person), compliance with regulatory requirements
or otherwise).

 

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(c)    “Net Long Position” means such Person’s net long position, as defined in
Rule 14e-4 under the Exchange Act, mutatis mutandis, in respect of the Voting
Securities.

(d)    “Nomination Notice” means the letter, dated March 9, 2018, delivered to
the Company, giving notice to the Company of a member of Vintage Capital’s
intent to, among other things, nominate individuals for election to the Board at
the 2018 Annual Meeting.

(e)    “Person” means any individual, corporation (including not-for-profit),
general or limited partnership, limited liability or unlimited liability
company, joint venture, estate, trust, association, organization or other entity
of any kind or nature.

(f)    “Voting Securities” means the Common Shares, and any other securities of
the Company entitled to vote in the election of directors, or securities
convertible into, or exercisable or exchangeable for, Common Shares or other
securities, whether or not subject to the passage of time or other
contingencies.

10.    Miscellaneous. The parties hereto recognize and agree that if for any
reason any of the provisions of this Agreement are not performed in accordance
with their specific terms or are otherwise breached, immediate and irreparable
harm or injury would be caused for which money damages would not be an adequate
remedy. Accordingly, each party agrees that in addition to other remedies the
other party shall be entitled to at law or equity, the other party shall be
entitled to seek an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this Agreement
exclusively in the Delaware Court of Chancery or, if the Delaware Court of
Chancery does not have jurisdiction, other federal or state courts of the State
of Delaware. Furthermore, each of the parties hereto: (a) consents to submit
itself to the personal jurisdiction of the Delaware Court of Chancery or, if the
Delaware Court of Chancery does not have jurisdiction, other federal or state
courts of the State of Delaware in the event any dispute arises out of this
Agreement or the transactions contemplated by this Agreement; (b) agrees that it
shall not attempt to deny or defeat such personal jurisdiction by motion or
other request for leave from any such court; (c) agrees that it shall not bring
any action relating to this Agreement or the transactions contemplated by this
Agreement in any court other than the Delaware Court of Chancery or, if the
Delaware Court of Chancery does not have jurisdiction, other federal or state
courts of the State of Delaware, and each of the parties irrevocably waives the
right to trial by jury with respect to any matter arising under or related to
this Agreement; and (d) irrevocably consents to service of process by a
reputable overnight mail delivery service, signature requested, to the address
of such party’s principal place of business or as otherwise provided by
applicable law. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS, INCLUDING
VALIDITY, INTERPRETATION AND EFFECT (INCLUDING DISPUTES RELATING THERETO), BY
THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS EXECUTED AND TO BE
PERFORMED WHOLLY WITHIN SUCH STATE WITHOUT GIVING EFFECT TO THE CHOICE OF LAW
PRINCIPLES OF SUCH STATE.

 

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11.    No Waiver. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of this
Agreement. No waiver of any of the provisions of this Agreement shall be
effective unless it is in writing signed by the party making such waiver. The
failure of a party to insist upon strict adherence to any term of this Agreement
on one or more occasions shall not be considered a waiver or deprive that party
of the right thereafter to insist upon strict adherence to that term or any
other term of this Agreement.

12.    Entire Agreement. This Agreement contains the entire understanding of the
parties with respect to the subject matter hereof and may be amended only by an
agreement in writing executed by the parties hereto.

13.    Notices. All notices, consents, requests, instructions, approvals and
other communications provided for herein and all legal process in regard hereto
shall be in writing and shall be deemed validly given, made or served, if
(a) given by email, upon confirmation of receipt (but only if such confirmation
is not automatically generated) or (b) if given by any other means, when
actually received during normal business hours at the address specified in this
subsection:

if to the Company:

Vitamin Shoppe, Inc.

300 Harmon Meadow Blvd

Secaucus, New Jersey 07094

Attention:        David M. Kastin

       Senior Vice President, General Counsel and Corporate

       Secretary

Email:              David.kastin@vitaminshoppe.com

With a copy (which shall not constitute notice) to:

Kirkland & Ellis LLP

601 Lexington Avenue

New York, NY 10022

Attention:        Michael P. Brueck

      Shaun J. Mathew

Email:             michael.brueck@kirkland.com

      shaun.mathew@kirkland.com

if to Vintage Capital:

Vintage Capital Management, LLC

4705 S. Apopka Vineland Road, Suite 206

Orlando, FL 32819

Attention:        Brian R. Kahn

Email:              bkahn@vintcap.com

 

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With a copy (which shall not constitute notice) to:

Wilson Sonsini Goodrich & Rosati

Professional Corporation

650 Page Mill Road

Palo Alto, CA 9304

Attention:        Bradley L. Finkelstein

                Douglas K. Schnell

Email:              bfinkelstein@wsgr.com

                dschnell@wsgr.com

14.    Severability. If at any time subsequent to the date of this Agreement,
any provision of this Agreement shall be held by any court of competent
jurisdiction to be illegal, void or unenforceable, such provision shall be of no
force and effect, but the illegality or unenforceability of such provision shall
have no effect upon the legality or enforceability of any other provision of
this Agreement.

15.    Counterparts. This Agreement may be executed in two or more counterparts
which together shall constitute a single agreement.

16.    Successors and Assigns. This Agreement shall not be assignable by any of
the parties to this Agreement. Any purported assignment of this Agreement shall
be null and void. This Agreement, however, shall be binding on successors of the
parties hereto.

17.    No Third Party Beneficiaries; Parties in Interest. This Agreement is
solely for the benefit of the parties hereto and is not enforceable by any other
Persons. Without limiting the foregoing (i) the provisions of this Agreement
shall be personal to, and enforceable solely by, Vintage Capital and the Company
and (ii) the provisions of the Shah Cooperation Agreement (including with
respect to the appointment of the Shah Designees) shall be personal to, and
enforceable solely by, Shah Capital and the Company.

18.    Fees and Expenses. The Company shall reimburse Vintage Capital for its
reasonable and documented out-of-pocket costs, fees and expenses incurred and
paid in connection with, relating to or resulting from its efforts and actions,
and any preparations therefor, prior to the execution and delivery of this
Agreement; provided, that such reimbursement (together with any reimbursement to
Shah Capital pursuant to the Shah Cooperation Agreement) shall not exceed
$100,000 in the aggregate. Such reimbursement shall be made by the Company
within ten business days following the submission by Vintage Capital and Shah
Capital of a joint and reasonably detailed invoice specifying the amount of
expenses to be reimbursed to each of Vintage Capital and Shah Capital and to
whom shall the Company pay such amounts (it being understood that such invoice
need not contain details which could result in a waiver of the attorney-client
privilege). Except as provided in this Section 18, neither the Company, on the
one hand, nor Vintage Capital, on the other hand, will be responsible for any
costs, fees or expenses of the other in connection with this Agreement.

19.    Interpretation and Construction. Each of the parties hereto acknowledges
that it has been represented by counsel of its choice throughout all
negotiations that have preceded the

 

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execution of this Agreement, and that it has executed the same with the advice
of said independent counsel. Each party and its counsel cooperated and
participated in the drafting and preparation of this Agreement and the documents
referred to herein, and any and all drafts relating thereto exchanged among the
parties shall be deemed the work product of all of the parties and may not be
construed against any party by reason of its drafting or preparation.
Accordingly, any rule of law or any legal decision that would require
interpretation of any ambiguities in this Agreement against any party that
drafted or prepared it is of no application and is hereby expressly waived by
each of the parties hereto, and any controversy over interpretations of this
Agreement shall be decided without regards to events of drafting or preparation.
The section headings contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement.
The term “including” shall be deemed to mean “including without limitation” in
all instances.

20.    Amendments. This Agreement may only be amended pursuant to a written
agreement executed by Vintage Capital and the Company.

[Signature Pages Follow]

 

11

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IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement, or
caused the same to be executed by its duly authorized representative as of the
date first above written.

 

VITAMIN SHOPPE, INC. By:  

/s/ David M. Kastin

  Name:   David M. Kastin   Title:   Senior Vice President, General Counsel and
Corporate Secretary

[Signature Page to Cooperation Agreement]

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VINTAGE CAPITAL MANAGEMENT, LLC By:  

/s/ Brian Kahn

  Name:   Brian Kahn   Title:   Manager KAHN CAPITAL MANAGEMENT, LLC By:  

/s/ Brian Kahn

  Name:   Brian Kahn   Title:   Manager MR. BRIAN R. KAHN

/s/ Brian R. Kahn

Brian R. Kahn

[Signature Page to Cooperation Agreement]

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EXHIBIT A

Vintage Capital Management, LLC

Kahn Capital Management, LLC

Brian R. Kahn

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EXHIBIT B

Press Release

Vitamin Shoppe to Appoint New Independent Directors to Board

SECAUCUS, N.J. – April 23, 2018 – Vitamin Shoppe, Inc. (NYSE: VSI), an
omni-channel, specialty retailer and contract manufacturer of nutritional
products, today announced that it will appoint up to five new independent
directors to its Board of Directors. Himanshu H. Shah, Sing Wang and Melvin L.
Keating will join the Board immediately and the Board will be expanded
accordingly. The Board may also appoint two additional independent directors at
a later date. Each of the newly appointed directors will stand for election at
the Company’s 2018 Annual Meeting of Stockholders. At that meeting, four current
directors (other than Colin Watts) will not stand for reelection. Mr. Watts will
leave the Board in connection with his previously announced departure from
Vitamin Shoppe.

In connection with today’s announcements, Vitamin Shoppe has also entered into
cooperation agreements with Shah Capital Management and certain of its
affiliates (“Shah Capital”) and Vintage Capital Management, LLC and certain of
its affiliates (“Vintage Capital”), which currently own approximately 17.7% and
14.8% of Vitamin Shoppe’s outstanding common stock, respectively. Pursuant to
the cooperation agreements, Shah Capital and Vintage Capital will vote their
shares in favor of all of Vitamin Shoppe’s director nominees at the Company’s
2018 and 2019 Annual Meetings of Stockholders and have agreed to abide by
customary standstill provisions and voting commitments. The complete agreements
will be included as exhibits to a Current Report on Form 8-K, which will be
filed with the Securities and Exchange Commission.

Pursuant to the cooperation agreements, the Company has also agreed to commence
a tender offer for its common stock on the terms and conditions described in the
cooperation agreements. The Board appointments and capital return announced
today follow a number of steps that Vitamin Shoppe has recently taken as it
continues to execute its turnaround strategy to position itself as the Wellness
Authority for its customers. In March 2018, Vitamin Shoppe repurchased
$45.4 million in aggregate principle amount of its 2.25% Convertible Senior
Notes due December 2020. Vitamin Shoppe has explored a range of strategic
options for its Nutri-Force business and is pursuing a sale of the business.
Other initiatives, such as SPARK Auto Delivery, continue to resonate with
customers.

Commenting on the new Board members, Alexander W. Smith, Executive Chairman of
the Board, stated, “We welcome Himanshu, Sing and Mel to the Board as they each
bring relevant experience and perspectives in areas essential to our business.
These appointments underscore our commitment to ongoing board refreshment and
our focus on enhancing the skills and expertise represented on the Vitamin
Shoppe Board.”

Brian R. Kahn, founder and managing member of Vintage Capital, said, “We are
pleased that Vitamin Shoppe has added these outstanding new directors, who we
believe will enhance the Board. We look forward to watching Vitamin Shoppe
continue to focus on increasing stockholder value.”

Himanshu H. Shah, founder and managing member of Shah Capital, said, “The
Vitamin Shoppe’s Board has demonstrated its responsiveness to its shareholders
through this agreement. The infusion of new perspectives into the Board
announced today will position it to realize its tremendous potential. I look
forward to working together constructively towards our shared objective of
enhancing value for all.”

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About the Vitamin Shoppe, Inc. (NYSE:VSI)

Vitamin Shoppe is an omni-channel, specialty retailer and contract manufacturer
of nutritional products based in Secaucus, New Jersey. In its stores and on its
website, the Company carries a comprehensive retail assortment including:
vitamins, minerals, specialty supplements, herbs, sports nutrition, homeopathic
remedies, green living products, and beauty aids. In addition to offering
products from approximately 900 national brands, the Vitamin Shoppe also carries
products under The Vitamin Shoppe®, BodyTech®, True Athlete®, MyTrition®, plnt®,
ProBioCare®, Next Step® and Betancourt Nutrition® brands. The Vitamin Shoppe
conducts business through more than 775 company-operated retail stores under The
Vitamin Shoppe and Super Supplements retail banners, and through its website,
www.vitaminshoppe.com. Follow the Vitamin Shoppe on Facebook at
http://www.facebook.com/THEVITAMINSHOPPE and on Twitter at
http://twitter.com/VitaminShoppe.

Forward-Looking Statements

This press release contains “forward-looking” statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, including with respect to the composition of the Company’s
board of directors, the Company’s potential growth and strategy, and the
commencement of a tender offer. These forward-looking statements can be
identified by the use of words such as “outlook”, “believes”, “expects”,
“potential”, “continues”, “may”, “will”, “should”, “seeks”, “predicts”,
“intends”, “plans”, “estimates”, “anticipates”, “target”, “could” or the
negative version of these words or other comparable words. These statements are
subject to various risks and uncertainties, many of which are outside the
Company’s control. The Company believes that all forward-looking statements are
based on reasonable assumptions when made; however, it is impossible to predict
actual results or outcomes or the effects of risks, uncertainties or other
factors on anticipated results or outcomes with certainty and that, accordingly,
one should not place undue reliance on these statements. Forward-looking
statements speak only as of the date when made and the Company undertakes no
obligation to update these statements in light of subsequent events or
developments. Actual results may differ materially from anticipated results or
outcomes discussed in any forward-looking statement.

For further information: Analysts and Investors: Kathleen Heaney, 201-552-6430,
ir@vitaminshoppe.com; Media: Crystal Carroll, 201-552-6328,
crystal.carroll@vitaminshoppe.com

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SCHEDULE A

(a)    No later than May 31, 2018, the Company shall commence (within the
meaning of Rule 13e-4 under the Exchange Act), an issuer tender offer (the
“Tender Offer”) to all stockholders of the Company to acquire Common Shares in
an aggregate amount not to exceed $25,000,000 (the “Maximum Amount”) and at a
price per share in cash not to exceed $5. If less than 5 million shares are
tendered in the Tender Offer, then the Company will use the difference between
the Maximum Amount and the amount actually paid by the Company in the Tender
Offer (after taking into account any expenses incurred by the Company with
regard to the Tender Offer) to repurchase a portion of the Company’s 2.25%
Convertible Senior Notes due December 2020 (the “Convertible Notes”) at a
purchase price reflecting a discount of 26% or more to the Convertible Notes’
principal amount.

(b)    The commencement of the Tender Offer will be subject to ratification by
the Shah Designees and the Vintage Designee following their appointment to the
Board.