Document:

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

                   SPACE EXPLORATION TECHNOLOGIES CORPORATION

                        FALCON LAUNCH SERVICES AGREEMENT

     This Launch Services Agreement ("Agreement") is entered into as of November
15,  2005  ("Effective  Date")  by  and  between  Space Exploration Technologies
Corporation, a Delaware corporation with headquarters at 1310 East Grand Avenue,
El  Segundo,  CA 90245 ("SpaceX") and SpaceDev, Inc., with headquarters at 13855
Stowe  Drive,  Poway  California,  92064  ("Customer").  SpaceX and Customer may
hereinafter  be  referred  to  individually  as  "Party"  and  collectively   as
"Parties."

     WHEREAS,  Customer  desires  to purchase launch services for its spacecraft
and  its  customers'  spacecraft  with  the  parameters set forth in Appendix 1,
Statement  of  Work  ("Payload")  into  Earth  orbit;  and

     WHEREAS,  SpaceX provides launch services using the Falcon 1 Launch Vehicle
("Falcon");

     NOW  THEREFORE,  the  Parties  hereby  agree  as  follows:

1.     Services  to  be  Provided.  SpaceX  shall furnish launch services on the
Falcon  in  accordance  with  Appendix  1,  Statement  of  Work,  ("Basic Launch
Services"),  subject  to  the terms and conditions of this Agreement. Additional
services  may  be  provided  by  SpaceX on a time and material basis, subject to
negotiations,  mutual agreement of the Parties, and a separate statement of work
("Additional  Services").

2.     Contract  Price.

The  Contract  Price  is  the  sum  of:

     -  Basic  Launch  Services  at  [***  ***]  dollars  ($[***  ***]);

     -  Federal  range  usage  (RTS & VAFB) and payload integration fees at [***
     ***]  dollars  ($[***  ***]);  and

     -  Third  party liability insurance fees are [*** ***] dollars ($[*** ***])
     per  mission  thereafter.

Purchase  with pricing set forth in this section 2 is guaranteed to Customer for
up to two additional missions (at the option of Customer); however, a [*** ***]%
annual  increase  in  the  overall  Contract  Price  will be added to adjust for
inflation,  starting  on  Jan  1,  2008.

3.     Date  of  Launch.  The  expected launch date for contractual and planning
purposes  is  May 15, 2008 ("Estimated Launch Date"). By mutual agreement of the
Parties, the Estimated Launch Date may be adjusted up to 18 months in advance of
the  Estimated  Launch  date.  It  is mutually understood that the date when the
launch  actually  occurs ("Actual Launch Date") is dependent upon weather, range
availability,  government  approvals,  Falcon  readiness,  Payload readiness and
similar  factors.

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

4.     Payment  Terms.

     4.1     Payment  Schedule.  Customer shall pay to SpaceX the Contract Price
in  five  installments  in  accordance  with  the  following  schedule.

     -  [***  ***]  dollars  (US $[*** ***]) is a deposit and is due and payable
     [***  ***]  business  days  after  the  Effective  Date;

     - [*** ***] dollars (US $[*** ***]) is due and payable [*** ***] (Estimated
     Launch  Date  minus  [***  ***]);

     - [*** ***] dollars (US $[*** ***]) is due and payable [*** ***] (Estimated
     Launch  Date  minus  [***  ***]);

     -  [*** ***] dollars (US $[*** ***] is due and payable [*** ***] (Estimated
     Launch  Date  minus  [***  ***]);

     -  [***  ***]  dollars  (US $[*** ***]) is due and payable within [*** ***]
     days  of  actual  launch.

     4.2 Invoices. SpaceX shall submit invoices to Customer at least thirty (30)
days prior to the payment due date for each scheduled payment event set forth in
Section  4.1,  provided, however, that the executed Agreement shall serve as the
invoice for the first scheduled payment. Any payments delayed beyond the payment
due  date  shall  be  subject  to  interest at a rate of [*** ***] percent ([***
***]%)  per  day  of  delay.

     4.3  Invoice  Address.  SpaceX  shall  invoice  Customer  at  the following
address:

                             SpaceDev, Incorporated
                                Accounts Payable
                                  Stowe Drive
                                Poway, CA 92064

5.     Taxes.  To  the  best  knowledge  of SpaceX on the Effective Date of this
Contract,  no  taxes are due for the activities and transactions contemplated by
this  Agreement.  However, should taxes be levied, Customer alone shall bear any
and  all  national,  federal,  state  or  local sales, use, value added or other
taxes,  customs duties, or similar tariffs and fees that may levied or collected
upon  the  transactions contemplated by this Agreement ("Taxes"). Such Taxes are
not  included in the Contract Price as defined in Section 2, Contract Price, and
shall  be  borne  by Customer in addition to the Contract Price. Where SpaceX is
required  by  law  to  collect  Taxes,  SpaceX  shall  notify Customer of such a
requirement,  provide  evidence of requirement and Customer shall pay SpaceX the
appropriate  amount  in  addition  to  the  Contract  Price.

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

6.     Best  Price  Assurance.  SpaceX  intends that the Customer never pay more
than  the  standard price for Basic Launch Services at the time of the Estimated
Launch Date. If SpaceX reduces the single flight, standard price of Basic Launch
Services  prior  to  the Estimated Launch Date, the Customer will be entitled to
reduce  their  next  payment  to  SpaceX  accordingly  by the difference. If all
payments  for  launch  have been made or the reduction in price exceeds payments
due  from  the Customer, SpaceX will wire the appropriate rebate to the Customer
no  later  than  thirty  (30)  days  in  advance  of  the  Actual  Launch  Date.

7.     Reflight  Launch  Option.

     7.1 The Reflight Launch Option will entitle Customer to a [*** ***] for the
Basic Launch Services, paying only the [*** ***]. The Reflight Launch Option may
be  [***  ***]  the  Basic  Launch  Services  price up to [*** ***] prior to the
Estimated  Launch  Date and shall be subject to the terms and conditions of this
Agreement.  SpaceX  shall  make [*** ***] efforts to execute the reflight launch
within  [*** ***] months following the Actual Launch Date. The SpaceX obligation
to  execute  a  reflight launch will extend no more than [*** ***] following the
Actual  Launch  Date.  This option is [*** ***] only to [*** ***] and [*** ***].

     7.2 Qualifying Condition. The Parties agree that the Reflight Launch Option
is  exercisable  only  in the event of a Launch Failure due to the Falcon launch
vehicle. Such a Launch Failure must constitute either delivery of the Payload to
an  orbit  where  it  cannot  reasonably  be  used  for  the  intended  mission,
destruction  of the Payload as a result of Falcon breakup, or substantial damage
to  the  Payload due to launch loads that materially exceed those defined in the
Interface  Control  Document.

     7.3 Sole Remedy. The reflight launch shall be the sole and exclusive remedy
available  to  customer  for  any  launch failure or payload failure whatsoever,
including  any  inability  to  use  the  payload for all or part of its intended
mission,  howsoever  caused, and regardless of the theory of liability (with the
exception  of  gross  negligence),  whether based in contract or tort, including
negligence,  product  liability,  and  strict  liability, or any other theory of
liability,  provided,  however,  that  this  remedy shall be available only when
customer has purchased a reflight launch option and customer has made all of the
payments  and  reasonably  complied  with  all  of  the other conditions of this
agreement

8.     Third  Party  Liability.

     8.1     Insurance.  SpaceX  shall  procure  and maintain third party launch
liability  insurance  as  prescribed  by  the  Federal Aviation Administration's
Associate  Administrator  for  Commercial  Space  Transportation pursuant to the
Commercial  Space Launch Act, as amended, 49 U.S.C. Sec.Sec. 70101-70121. SpaceX
shall name as additional insureds Customer and its Payload customer, contractors
and  subcontractors  involved  in  launch  services, the U.S. government and its
contractors  and  subcontractors  involved  in  launch  services,  and  SpaceX's
contractors  and subcontractors involved in launch services. Such insurance will
comply  with  the  terms  of  the  Federal  launch  license.

                                      PAGE

9.     Cross  Waivers  of  Liability.
Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

     9.1     Third  party Liability. SpaceX shall be exclusively liable to third
parties  for  any  injury,  loss  or  damage to any third party caused solely by
SpaceX  or  its equipment, including the Falcon or parts thereof. Customer shall
be  exclusively  liable  to  third parties for any injury, loss or damage to any
third party caused solely by Customer or its equipment, including the Payload or
parts  thereof.

     9.2  Waivers. SpaceX and Customer agree to a reciprocal waiver of liability
pursuant  to which each Party agrees to assume the risk and agrees not to sue or
otherwise  bring  a  claim against the other Party or that Party's Related Third
Parties  or  against  the U.S. government and its contractors andsubcontractors,
for  any property loss or damage, including loss of or damage to the Payload, or
other  financial  loss  it  sustains, or for any injury, death, property loss or
damage  or  other financial loss sustained by its employees, officers, directors
or  agents,  arising  in  any  manner  out  of  or in connection with activities
relating  to  the  performance  of  this  Agreement.

     9.3 Extension of Waivers. SpaceX and Customer agree to extend the waiver of
liability  to  their respective contractors and subcontractors requiring them to
waive  the  right  to  sue or otherwise bring a claim against the other Party or
that  Party's  Related  Third Parties or the U.S. government and its contractors
and subcontractors, for any property loss or damage, including loss of or damage
to  the  Payload or Falcon, or other financial loss they may sustain, or for any
injury,  death,  property  loss  or  damage or other financial loss sustained by
their  employees, officers, directors or agents, arising in any manner out of or
in  connection  with  activities  relating to the performance of this Agreement.

     9.4  Indemnification.  SpaceX  and  Customer  agree  that  each Party shall
indemnify  and  hold  harmless  the  other  Party  from and against liability or
expense,  including  attorneys'  fees,  resulting  from any suit or claim by the
indemnifying  Party's  Related  Third  Parties  for any property loss or damage,
including  loss of or damage to the Payload, or other financial loss it sustains
or  for  any  injury,  death,  property  loss  or damage or other financial loss
sustained by its employees, officers, directors or agents, arising in any manner
out  of  or  in  connection  with activities relating to the performance of this
Agreement.

     9.5  Applicability.  When  applicable  to  the  Parties'  contractors   and
subcontractors,  the  waivers  shall  apply to contractors and subcontractors at
every  tier  that are involved in activities relating to the performance of this
Agreement.  The  waivers  shall  apply  regardless  of  the theory of liability,
whether  based in contract or tort, including negligence, product liability, and
strict  liability, or any other theory of liability. Each Party agrees to obtain
insurance as it deems necessary to cover death, injury, loss or damage for which
it  has  waived  the  right to sue or bring a claim against the other Party, and
each  Party  agrees  to  obtain  a waiver of subrogation rights from any insurer
providing  such  insurance  coverage.  Nothing  in this Section 9 shall preclude
SpaceX  from  suing  or otherwise bringing a claim against its own Related Third
Parties, nor shall it preclude Customer from suing or otherwise bringing a claim
against  its own Related Third Parties. The Parties agree to further memorialize
the rights and obligations described in this Section 9 in any agreement that may
advised  or  required  by  the  U.S.  government.

     9.6  Definition.  "Related  Third  Parties"  shall  mean:  1)  the Parties'
respective  contractors  and  subcontractors  at every tier that are involved in
activities  relating  to  the  performance  of  this  Agreement; 2) the Parties'
respective  directors,  officers,  employees,  and  agents;  or 3) any entity or
person  who has any valid right, title or interest in the Payload or the Falcon.

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

10.     Delays.

     10.1     Excusable  delay.  Neither  Party shall be liable for any delay or
failure  to  perform  under this Agreement in the event such delay or failure to
perform  is  due  to  a cause beyond the control and not due to the fault of the
Party  invoking  this Section 10.1. Such excusable delays shall include, but not
be  limited  to, Acts of God, acts of government in its sovereign or contractual
capacity,  acts or threat of terrorism, earthquake, riot, revolution, hijacking,
fire,  strike,  embargo,  sabotage,  or  interruption  of  essential services or
supplies.  The  period  of performance under this Agreement shall be extended by
the  duration  of  the  excusable delay. Notification of excusable delay will be
provided  in  writing  and  the  extension  period will     be agreed to by both
parties  in  writing.
10.2     Payload  delays.  If  the  Payload  causes  launch  delays  beyond  the
Estimated  Launch  Date,  the  Customer  will  pay  penalties  to  SpaceX on the
following  schedule  until the Payload is ready and delivered to SpaceX's launch
site:

     -  [***  ***]  for  the  [***  ***]  months;  and

     - [*** ***] of the Total Contract Price per month for months [*** ***]; and

     -  [***  ***]  of  the Total Contract Price per month for months [*** ***].

     10.3     Launch  vehicle delays. If the launch vehicle causes delays beyond
the  Estimated  Launch Date, SpaceX will reimburse the customer on the following
schedule  until  the  launch  vehicle  is ready for shipment to the launch site:

     -  [***  ***]  for  the  [***  ***]  months;  and

     - [*** ***] of the Total Contract Price per month for months [*** ***]; and

     -  [***  ***]  of  the Total Contract Price per month for months [*** ***].

     10.4     Delay  as a result of [*** ***]. If any [*** ***] of the [*** ***]
occurring  immediately before Customer's [*** ***] are [*** ***] as defined [***
***] then the Customer has the option of [*** ***] until SpaceX has demonstrated
to Customer's satisfaction [*** ***] and with the performance capability to [***
***].  [***  ***]  occurring  under  this  section  10.4 are not an [*** ***] as
defined  in  Section  10.1 and the Customer retains [*** ***] as defined in [***
***].
                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

11.     Intellectual  Propel Rights. SpaceX shall exclusively own and retain all
right,  title  and  interest  in  and  to  all  Inventions created, conceived or
developed  by  SpaceX  under this Agreement, including all intellectual property
rights therein and thereto. Customer shall exclusively own and retain all right,
title  and  interest in and to all Inventions created, conceived or developed by
Customer  under  this  Agreement,  including  all  intellectual  property rights
therein and thereto. The Parties do not intend to jointly develop any Inventions
under  this Agreement. As used in this Section 11, "Inventions" means all ideas,
designs,  concepts,  techniques,  inventions,  discoveries, works of authorship,
modifications,  improvements,  or derivative works, regardless of patentability.

12.     Confidentiality.

     12.1     Confidentiality  of  this  Agreement. Neither Party shall disclose
any  of the terms of this Agreement to any third party without the prior written
consent  of  the  other  Party,  except  as  compelled  by  judicial  or  other
governmental  action  and  with  reasonable  notice  provided  in writing to the
affected  Party  at  least  five  business  days  in  advance of the disclosure.

     12.2 Announcements. No public announcement, release, or other disclosure of
information  relating  to  this  Agreement,  including  the  existence  of  this
Agreement, shall be made except by prior written agreement of the Parties on the
specific  content  of  such  disclosure;  however,  such  agreement  may  not be
unreasonably  be  withheld.

     12.3  Confidential Information. SpaceX and Customer each agree to retain in
confidence  all  non-public  information,  trade secrets, and know-how disclosed
pursuant  to  this  Agreement  which  is either designated as proprietary and/or
confidential,  or  which  by  the  nature  of  the   circumstances   surrounding
disclosure,  should  reasonably  be understood to be confidential ("Confidential
Information"). Each Party agrees to: 1) preserve and protect the confidentiality
of  the  other Party's Confidential Information; 2) refrain from using the other
Party's  Confidential  Information  except as contemplated in this Agreement; 3)
disclose the Confidential Information only to its directors, officers, employees
or  agents  as  is  reasonably  required in connection with the exercise of that
Party's  rights  and  obligations  under this Agreement and subject to a binding
non-disclosure  agreement that is at least as protective as this Section 12; and
4)  not disclose Confidential Information to any third party, provided, however,
that  either Party may disclose Confidential Information of the other Party that
is: a) already in the public domain through no fault of the disclosing Party; b)
discovered  or  created  by  the  receiving  Party  without  reference  to   the
Confidential Information of the disclosing Party; c) otherwise made known to the
receiving Party through no wrongful conduct of the receiving Party or the entity
providing the information to the receiving party; or d) required to be disclosed
by  judicial or other governmental action (subject to reasonable notice provided
in  writing  to the affected Party at least five business days in advance of the
disclosure).  The  confidentiality  obligations of this Section 12 shall survive
the  expiration or termination of this Agreement for a period of five (5) years.

     12.4  Notwithstanding  any  provision  of  this Section 12 to the contrary,
either  Party  may disclose the Confidential Information, including the terms of
this  Agreement:  1)  in  confidence,  to  legal  counsel;  2) in confidence, to
accountants,  banks,  and  financing  sources  and their advisors solely for the
purposes  of  securing  financing; 3) in confidence, to its insurance broker and
prospective  insurers  solely  for  the  purposes  of securing insurance for the
payload and launch services and in settling any claim for loss; 4) in connection
with  the enforcement of this Agreement or rights under this Agreement; or 5) in
confidence,  in  connection  with  an actual or proposed merger, acquisition, or
similar  transaction  solely  for  use  in  the  due  diligence investigation in
connection  with  such  transaction.
                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

13.     Limitation  of  Liability.

     13.1     No Consequential Damages. In no event shall either Party be liable
for  any  indirect,  special,  incidental,  exemplary, punitive or consequential
damages  of  any  kind,  for  the  cost of procurement of substitute products or
services,  or for lost revenues or profits, arising out of or in connection with
this  Agreement,  howsoever  caused  and  regardless of the theory of liability,
whether  based in contract or tort, including negligence, product liability, and
strict  liability,  or  any  other  theory  of  liability.

     13.2  Total  Liability. SpaceX's total and cumulative liability arising out
of  or  in connection with this Agreement howsoever caused and regardless of the
theory  of  liability,  whether based in contract or tort, including negligence,
product liability, and strict liability, or any other theory of liability, shall
in  no event exceed the amounts actually paid by Customer and received by SpaceX
for  Basic  Launch  Services  pursuant  to  this  Agreement.

     13.3  Application. The limitations set forth in this Section 13 shall apply
even  if  SpaceX  has been advised of the possibility of such losses or damages,
and  notwithstanding  any failure of essential purpose of any limited remedy set
forth  in  this  Agreement.  The  Parties  acknowledge  that the amounts payable
hereunder  are based in part on the limitations of this Section 13 and that such
limitations  are  a  bargained  for  and  essential  part  of  this  Agreement.

14.     Warranties.  Except  for  the  Reflight  Launch  Option (if purchased by
Customer),  SpaceX  has  not  made,  nor  does  it  make,  any representation or
warranty,  whether  written  or oral, whether express or implied, including, but
not  limited  to,  any  warranty  of  design,  operation,  quality, workmanship,
suitability,  result,  merchantability, or fitness for a particular purpose with
respect  to  the  Falcon, launch services, or associated equipment and services.
Any  implied warranties, including warranties of merchantability and fitness for
a  particular  purpose,  are  hereby  expressly  disclaimed.

15.     Termination.

     15.1     Mutual  Agreement.  This  contract  may  be  terminated  by mutual
consent  of the Parties in writing signed by the duly authorized representatives
of  both  Parties.

     15.2  Customer's  Right  to Terminate. If SpaceX is unable to provide Basic
Launch  Services  within  twelve (12) months following the Estimated Launch Date
(with  the  exception  of  additional  time resulting from an excusable delay as
defined  by  section  10.1), Customer will, subject to a thirty (30) day written
notice  to SpaceX, have the option of terminating this Agreement. Separately, in
the  event  of  failure by SpaceX to comply with any other material provision of
this  Agreement  after  having  been given a ninety (90) day period to cure such
non-performance,  Customer  will  have the option of terminating this Agreement.
Upon  such termination, Customer shall be entitled to receive a refund within 30
days  of all payments actually made by Customer and received by SpaceX for Basic
Launch  Services  pursuant to this Agreement (minus any penalties paid to SpaceX
pursuant  to  Section 10.2 and any payments attributable to Federal range usage,
payload  integration  fees,  or  third-party  liability   insurance   fees,   if
applicable)  up  to  the  date  of  Termination and SpaceX shall have no further
obligations  or  liability  to  Customer.  The  right to terminate and receive a
refund  is  Customer's sole and exclusive remedy for termination in the event of
delay  in  the  launch  of  the  Payload.

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

     15.3  SpaceX's  Right  to  Terminate.  SpaceX  shall  have  the  option  of
terminating  this  Agreement  and  retaining  all   payments   without   further
obligations  or liability to Customer for the following reasons: in the event of
a  failure  by Customer to deliver the Payload for integration within thirty six
(36)  months  following  the  Estimated  Launch  Date  (with  the  exception  of
additional  time  resulting from an excusable delay as defined by section 10.1);
or  in  the  event  of  failure  by  Customer  to comply with any other material
provision  of this Agreement after having been given a ninety (90) day period to
cure  such  non-performance.

     15.4  Supplemental  right [*** ***]. Customer shall have the option of [***
***] in writing at any time at least [*** ***] months prior to the [*** ***] and
shall  be  entitled  to  a  [***  ***].

16.     Licenses.  Each  Party  shall be responsible for obtaining any licenses,
authorizations, clearances, approvals or permits ("Licenses") necessary to carry
out  its  obligations  under  this  Agreement.  Each  Party  agrees  to  provide
reasonable  assistance  to the other Party as necessary to obtain such Licenses.
SpaceX  shall  be  responsible  for obtaining any Licenses required to carry out
launch services in the United States, and Customer agrees to provide information
and  to execute any documentation needed to obtain such Licenses pursuant to the
United  States  International  Traffic  in  Arms  Regulations,  22  C.F.R. Parts
120-130,  and Regulations for the Importation of Arms, Ammunition and Implements
of  War,  27  C.F.R.  Part  447.

17.     Compliance  with  Government  Requirements. SpaceX and Customer agree to
comply  with  their  respective  national,  federal,  state  and  local laws and
regulations,  and  any government licenses, and Customer, in addition, agrees to
comply  with  U.S.  export  and  import  laws,  regulations, rules, licenses and
agreements  applicable  to  the  launch of Customer's Payload. Customer shall be
responsible  for  arranging  for  registration  of  the  Payload pursuant to the
Convention  on  Registration  of  Space  Objects Launched Into Outer Space, done
January  14,  1975,  T.I.A.S.  8480.

18.     Notices

     18.1     Transmittal.  All  notifications and other data transmittals under
this  Agreement  shall  be  in  writing  and shall be hand-delivered or sent via
express  mail,  first  class mail, or electronic mail to the addresses specified
below  with  confirmation  of  receipt.

     18.2  Effective  Date.  The  date  upon  which  any  such  communication is
hand-delivered  or,  if  such  communication  is  sent  by mail or by electronic
transmission,  the  date  upon  which  the  addressee  receives it, shall be the
effective  date  of  such  communication.

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

18.3     Change  of  Address.  Each Party shall promptly notify the other in the
event  of  any  change  in  their  respective  addresses.

For  correspondence  sent  to  SpaceX:

          Space Exploration Technologies Corp. 1310 East Grand Avenue
                              El Segundo, CA 90245
                              Attn: Gwynne Shotwell
                             PH. 310-414-6555 X 229
                                Fax: 310-414-6552
                            Email: gwynne@spacex.com

For  correspondence  sent  to  Customer:

                                 SpaceDev, Inc.
                                  Stowe Drive
                                Attn: John Cloyd
                                PH: 858-375-2000
                                Fax: 858-375-1000
                         Email: John.Cloyd@spacedev.com

19.     Dispute  Resolution.  All  disputes  and controversies of every kind and
nature  arising  out  of  this  Agreement including the existence, construction,
validity,  interpretation, performance, nonperformance, enforcement or breach of
any  provision  of this Agreement, shall be settled by commercial arbitration in
accordance  with  the  Commercial  Arbitration Rules of the American Arbitration
Association. The findings of such Arbitrator shall be final and binding upon all
parties.  Any  award  of  arbitration  shall  include attorney fees and costs of
arbitration,  including  but  not limited to expert witness fees, payable to the
prevailing  party  in  the  arbitration,  as  determined  by  the  Arbitrator.

20.     Appendices.

     20.1     Incorporation  by  Reference.  The  following  appendices  are
incorporated  into  this Agreement by reference and shall be an integral part of
this  Agreement:

     -  Appendix  1,  Statement  of  Work

     -  Appendix  2, [*** ***] Document--to be provided at Estimated Launch Date
     [***  ***]

     20.2     Precedence.  In  the  event of conflict between this Agreement and
any  of  the appendices, this Agreement shall govern. In the event of a conflict
between  Appendices,  the  sequence  of  precedence  shall  be  as listed above.

21.     Severability.  If  any  portion  of  this Agreement is held invalid, the
Parties  agree  that  such  invalidity  shall  not  affect  the  validity of the
remaining  portions  of  this Agreement, unless applying such remaining portions
would  frustrate  the  purpose  of  this  Agreement.

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

22.     Waiver.  The  failure  of  either Party to exercise any right granted in
this  Agreement  or  to require any performance of any term of this Agreement or
the  waiver  by either Party of any breach of this Agreement shall not prevent a
subsequent  exercise  or enforcement of, or be deemed a waiver of any subsequent
breach  of,  the  same  or  any  other  term  of  this  Agreement.

23.     No  Joint  Venture or Agency. Nothing in this Agreement shall constitute
or create a joint venture, partnership, or any other similar arrangement between
the  Parties.  No  Party  is  authorized  to  act  as  agent for the other Party
hereunder  except  as  expressly  stated  in  this  Agreement.

24.     Assignment. Customer may not assign, delegate or otherwise transfer this
Agreement  or any rights or obligations under this Agreement, whether voluntary,
by  operation  of law or otherwise, without the prior written consent of SpaceX,
unless  to a successor. With the written consent of SpaceX, Customer may use the
value  of  the  Agreement  in  excess  of  cost  as  collateral  to  secure  any
indebtedness of Customer. SpaceX may assign, delegate or otherwise transfer this
Agreement,  or  any rights or obligations under this Agreement, to any successor
by  way of merger, acquisition or sale of all or substantially all of the assets
relating  to  the  performance  of  this  Agreement. SpaceX or any successor may
assign  all  or  part  of  the  right  to  payments  under  this  Agreement. Any
assignment,  delegation,  or transfer of this Agreement made in contravention of
the  terms  hereof  shall  be  null  and  void.  Subject  to the foregoing, this
Agreement  shall  be  binding  on  and  inure  to  the  benefit  of the Parties'
respective  successors  and  permitted  assigns.

25.     Governing  Law.  This Agreement and performance by the Parties hereunder
shall  be  construed  in  accordance  with  the laws of the State of California,
U.S.A.,  without  regard  to  provisions  on  the  conflicts  of  laws.

26.     Entire  Agreement.  This  Agreement,  and  all  Exhibits  and Appendices
hereto,  supersedes  all prior communications, transactions, and understandings,
whether  oral  or  written,  with  respect  to  the  subject  matter  hereof and
constitutes  the sole and entire agreement between the Parties pertaining to the
subject  matter  hereof.

27.     Modification. No modification, addition or deletion, or waiver of any of
the  terms  and  conditions  of  this Agreement shall be binding on either Party
unless  made in a non-preprinted agreement clearly understood by both Parties to
be  a  modification or waiver, and signed by a duly authorized representative of
each  Party.

28.     Insurance Support. Parties agree to cooperate with reasonable efforts to
obtain  and  maintain  launch  insurance  and to support filing and settling any
claims.  This  includes  responding  to  insurer questions, delivering requested
information  regarding the Falcon and the launch range facilities and conducting
insurance  briefings and facilitating site inspections as required to obtain and
maintain  such  insurance.

IN WITNESS WHEREOF, the undersigned have executed this Agreement effective as of
the  Effective  Date:

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

Space  Exploration  Technologies  Corp.               Customer

By:      /s/  Elon  Musk                          By:    /s/  Richard B. Slansky
         ----------------                                 ----------------------
Name:         Elon  Musk                             Name:  Richard  B.  Slansky
              ----------                                     -------------------
Title:     CEO                                              Title:     President
           ---                                                         ---------
Date:     11/15/05                                            Date:     11/15/05

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

                                   APPENDIX 1

                                STATEMENT OF WORK
                        FOR PROGRAM NAME LAUNCH SERVICES

1.0     SCOPE

This  document  defines  the  effort  required by Space Exploration Technologies
(SpaceX)  and  the  customer  to  launch  the  spacecraft  and to accomplish the
objectives  of  the  PROGRAM NAME program.  The Program Master Plan Master (MP),
includes  this  description  of the tasks and responsibilities to launch PROGRAM
NAME program as well as an integrated Master Schedule. This Document can be used
by  the  customer for tracking the programmatic and technical status and will be
updated,  as  required  throughout  the  program  with  customer  concurrence.

     1.1  OBJECTIVES

The  objectives of the PROGRAM NAME program is the successful launch and orbital
insertion  of  the  PROGRAM NAME payload.  The payload will be placed into a TBD
orbit.  The  launch  will  take  place  according  to the schedule identified in
Attachment  1, IMS.  For performance purposes, the spacecraft and launch vehicle
adapter  are  assigned  a  combined maximum mass of TBD (to be identified in the
contract).

     1.2  ROLES  AND  RESPONSIBILITIES

SpaceX will furnish [*** ***].  The customer will provide the spacecraft, unique
spacecraft  support  equipment,  payload  specific  facilities,  and  [*** ***].

[***  ***]  shall:

     -  Provide the [*** ***] the PROGRAM NAME mission (documentation is defined
     in  the  CDRL  list)

     - Provide [*** ***] for the spacecraft for up to [*** ***] to the scheduled
     launch  date  on  [***  ***]

     -  Process  the  [***  ***]  at  the  launch  range

     -  Provide  all  range  and  safety  interfaces  including  127-1  document
     templates  for  the  spacecraft provider to complete, a copy of EWR 127 and
     RCC  319,  as  tailored  for  the  PROGRAM  NAME  program,

     -  Successfully  [***  ***]  within the specified environmental constraints

     -  Command  the  [***  ***]

     -  Support  post-flight  analysis  to verify successful separation from the
     launch  vehicle  and  identify  the  spacecraft  orbit

     -  Provide  post  launch  services  including  delivery  of  the [*** ***].

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

In  addition, [*** ***] shall be provided a sufficient level of insight in order
to  assess  mission  risk  and  safety  for  [***  ***].

A  successful  launch  is  always a result of teamwork and cooperation.  To this
end,  [***  ***]  responsibilities  include  the  following:

     1. Verification that [*** ***] can function appropriately after exposure to
     the  following  [***  ***]  environments:
          a.  [***  ***]
          b.  [***  ***]
          c.  [***  ***]
          d.  [***  ***]
          e.  [***  ***]
          f.  [***  ***]

     2.  [***  ***]  must  show  that:
          a.  It  does  not  interfere  with  [***  ***]
          b.  LV  and  range  [***  ***]

     3.  [***  ***]  must  provide  information  necessary  to  satisfy:
          a.  Range  Safety
          b.  NEPA
          c.  FAA
          d.  Other  regulatory  agencies  as  appropriate

     4.  In  addition,  [***  ***]  is  responsible  for:
          a.  Reporting  final  [***  ***].
          b.  Providing  an  appropriate  and  secure  [***  ***].
          c.  Transporting  [***  ***]  to  the  launch  location.
          d.  Checkout  of  [***  ***]  at  [***  ***],  including  [***  ***].

[***  ***]  shall  be  responsible  for  providing  the  following:

     -  Inputs  to  the  Launch  Vehicle  to  Spacecraft  ICD
     -  Test  verified  [***  ***]  structural  math  model
     -  [***  ***]  launch  configuration  envelope  drawing  or  model
     -  Spacecraft  design  information  for  mission  analyses
     -  Participate  in  [***  ***]
     -  [***  ***]  support  and  checkout  equipment
     -  Inputs  to  [***  ***]
     -  Inputs  to  [***  ***]
     -  Present  [***  ***]
     -  Present  [***  ***]  at  the  [***  ***]

2.0     PROGRAM  MANAGEMENT

[***  ***]  shall  manage  the  PROGRAM  NAME program tasks as described in this
document.

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

2.1        [***  ***]

[*** ***] shall provide [*** ***] providing sufficient insight to [*** ***], the
launch  vehicle  to spacecraft interface and integration, [*** ***].  Changes to
[***  ***].

2.2        [***  ***]

[***  ***]  shall  provide  [***  ***],  including  all [*** ***].  SpaceX shall
coordinate  with  the  customer  to  integrate  [***  ***]  into  this  plan.

2.3        [***  ***]
[***  ***] shall implement [*** ***] to ensure maximum [*** ***] of PROGRAM NAME
[***  ***],  including  [***  ***]  launch  services.  The  SpaceX  [***  ***].

2.4        [***  ***]

Per  the  [***  ***] PROGRAM NAME [*** ***],[*** ***] will conduct [*** ***] for
this  contract  which  meets  the  [***  ***],  as tailored for the PROGRAM NAME
program.

2.5        [***  ***]

[*** ***] shall implement and maintain a [*** ***].  The system shall [*** ***].

SpaceX  shall  provide  drawings and documentation to adequately define the [***
***].  These  [***  ***]  shall  be document in [*** ***].  In addition the [***
***]  shall  include  the [*** ***].  The [*** ***] shall be approved and signed
off  by  SpaceX  and the customer by the date defined in Table 1.  The [*** ***]
shall  be  maintained  by  [***  ***].  Any  changes  to  the [*** ***] shall be
approved  by  both  SpaceX  and  the  customer.

2.6     PROGRAM  REVIEWS  AND  MEETINGS

     2.6.1  [***  ***]

[***  ***]  shall  be  conducted  at the SpaceX facility.  The expected need for
these  [***  ***].  SpaceX  shall  [***  ***].

For  the  PROGRAM  NAME,  the  [***  ***]:

     -  [***  ***]
     -  [***  ***]
     -  [***  ***]
     -  Performing  [***  ***]  and  [***  ***]

     2.6.2  [***  ***]

As  necessary, [*** ***] shall be [*** ***] related to [*** ***].  The [*** ***]
and  [***  ***]  be  coordinated  as  necessary  with the customer.  Topic areas
include:

     -  Definition  of  [***  ***]
     -  Planning  [***  ***]  operations  and  associated  [***  ***]
     -  Coordinating  all  [***  ***]  analyses

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

     -  Coordinate  [***  ***]  and  refining  the  [***  ***]
     -  Planning  and  performing  [***  ***]

2.6.3     [***  ***]  Review

[***  ***] shall conduct a review of the [*** ***].  This serves as a [*** ***].
[*** ***] shall prepare [*** ***] providing the [*** ***] compared to [*** ***].
The [*** ***] shall include the [*** ***].  An assessment of any [*** ***] shall
also  be included.  The output of this task shall be the [*** ***].  Preliminary
data  shall  be  delivered [*** ***] after launch.  The final [*** ***] shall be
delivered  within  [***  ***]  of  launch.

2.6.4     [***  ***]  Reviews

A  [***  ***]  will be conducted that includes a [*** ***].  This [*** ***] will
nominally  be  conducted  [***  ***]  to launch.  The [*** ***] will prepare and
brief the [*** ***] of this [*** ***].  Coordination of the presentation is [***
***].

The  [***  ***]  shall  be  held [*** ***] prior to launch and presented to [***
***].

2.7     REPORTS

[***  ***]  shall  provide data and reports to [*** ***] as proposed here and in
accordance with the Contract.  Electronic submission of all deliverable items is
preferred.

A  detailed  list  of  the  reports  and  deliverables  for are identified here:

                            PROGRAMMATIC DELIVERABLES
                            -------------------------
               TOP LEVEL DELIVERABLES     FREQUENCY     [*** ***]
               ----------------------     ---------     ---------
[***  ***]     [***  ***]
----------     ----------

                      TECHNICAL MILESTONES AND DELIVERABLES
                      -------------------------------------
                   NUMBER     TITLE     DETAILS     [*** ***]
                   ------     -----     -------     ---------
1     [***  ***]     [***  ***]     [***  ***]
-     ----------     ----------     ----------
2     [***  ***]     [***  ***]     [***  ***]
-     ----------     ----------     ----------
3     [***  ***]     [***  ***]     [***  ***]
-     ----------     ----------     ----------
4     [***  ***]     [***  ***]     [***  ***]
-     ----------     ----------     ----------

                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

3.0     VEHICLE  PRODUCTION  AND  FLIGHT

[***  ***]  shall  produce  the  PROGRAM  NAME  [***  ***].

3.1     DESIGN  AND  ANALYSIS

[***  ***]  shall  conduct  analyses  and  verify  the  design  of  [*** ***] to
accommodate  and  successfully  [*** ***] system.  Specific analyses planned are
listed  below.

3.1.1     [***  ***]  Planning

[***  ***] shall conduct planning and analyses to support [*** ***].  The output
of  this  planning  shall  be  the  [***  ***].

[***  ***]  shall  perform [*** ***] which shall support performance, [*** ***].
The  output  of  this  task  is  a  report  describing  [***  ***].

[***  ***]  shall  perform  [***  ***].  The  output  of  this  task is a report
summarizing  the  results  of  this  analysis  and  highlighting  any  issues or
concerns.

[***  ***]  shall perform a [*** ***] all phases of this mission.  The output of
this  task  is  a  [***  ***],  as defined in the [*** ***], with the [*** ***].

3.1.2        [***  ***]

[***  ***]  shall  perform [*** ***].  Final due dates of the [*** ***] provided
data  and  [***  ***] provided [*** ***] shall be mutually agreed to in the [***
***].

[***  ***]  shall  perform  [*** ***] to determine the [*** ***].  The [*** ***]
test [*** ***] shall be provided by [*** ***] for the purposes of this analysis.
This  analysis  shall  include  a  recommendation  for  [***  ***].

[***  ***]  will provide a time history of relevant [*** ***] by which [*** ***]
can perform [*** ***] analyses.  Assumptions for the [*** ***] will be discussed
during  [***  ***]  meetings.

[***  ***]  shall  provide  [*** ***] for the [*** ***] with a [*** ***] factor.
[***  ***] is responsible for ensuring [*** ***] can withstand this environment.

[*** ***] will provide [*** ***] with the relevant [*** ***] prior to and during
launch,  including the [*** ***] environment.  [*** ***] will be responsible for
ensuring  the  [***  ***]  does not cause a hazardous condition while exposed to
this  environment.

[***  ***] will provide [*** ***] the [*** ***] will be responsible for ensuring
[***  ***]  does  not  cause  a  hazardous  condition  while  exposed  to  this
environment.
                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

[***  ***]  will provide [*** ***] the [*** ***] environment.  [*** ***] will be
responsible  for  ensuring  [*** ***] does not cause a hazardous condition while
exposed  to  this  environment

3.2        [***  ***]

The [*** ***] supplied by [*** ***] shall utilize the [*** ***], as described in
the  Contract and the [*** ***].  The payload interface characteristics, payload
environmental  conditions, and implementation of the services shall be described
in  the  [*** ***].  Following [*** ***] of [*** ***] will be maintained by [***
***] shall coordinate all aspects of [*** ***].  The standard [*** ***] consists
of  the  following:

     -  [***  ***]:
          o  [***  ***]
          o  [***  ***]  information  [***  ***]
          o  [***  ***]  Output  includes:
               -  [***  ***]  PROGRAM  NAME  [***  ***]
               -  PROGRAM  NAME  [***  ***]
               -  Preliminary  [***  ***]
               -  Templates  for  the  [***  ***]
               -  [***  ***]
               -  [***  ***]

     -  Final  [***  ***]  design,  including:  [***  ***]  requirements
          o  [***  ***]  to  provide  test  verified  [***  ***]
          o  [***  ***]  analysis  begins

     -  [***  ***]  Readiness
          o  [***  ***]  plan
          o  [***  ***]

     -  [***  ***]
          o  [*** ***] review of [*** ***] verifying [*** ***] with PROGRAM NAME
          environments
          o  [***  ***]  checks
          o  [***  ***]  and  PROGRAM  NAME  [***  ***]  completed
          o  Confirm  [***  ***]  are  compatible  with  PROGRAM  NAME
          o  [***  ***]  approval

     -  [***  ***]  review
                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

     -  Payload  [***  ***]  location
     -  [***  ***]
     -  [***  ***]
     -  [***  ***]
     -  [***  ***]

3.3     LAUNCHVEHICLE  PROCUREMENT  AND  MANUFACTURE
[***  ***]  shall  [***  ***]  to  meet  the  program  schedule.

3.4     LAUNCH
[***  ***] shall prepare for and [*** ***].   The [*** ***] the customer and the
launch  range.

3.4.1     Launch  Site
[***  ***]  shall  provide  [***  ***].   The  launch  is  [***  ***].

3.4.2     Facility  Support  and  Operations
Except  as noted below, the [*** ***] shall provide the [*** ***], and [*** ***]
the  [***  ***]  is  responsible for [*** ***], handling and transportation [***
***].

The  facilities  to  be  [*** ***] shall include the [*** ***] shall act as [***
***] shall maintain appropriate [*** ***] on all range related interfaces.  [***
***]

Base  security  and  badge  control     Equipment  storage
-----------------------------------     ------------------
Shop  and  laboratory  services         Non  hazardous  fluids  and  gases
-------------------------------         ----------------------------------
Range  scheduling                       Range  system  safety
-----------------                       ---------------------
Meteorology                             Communications  and  timing
-----------                             ---------------------------
Environmental  health                   Metric  tracking
---------------------                   ----------------
Launch  Vehicle  Telemetry              Video  coverage
--------------------------              ---------------
Fire  Protection
----------------

3.4.3        [***  ***]

[***  ***]  shall be available for [*** ***].  The facilities shall include [***
***]  space  for  [***  ***]  shall maintain [*** ***] management and scheduling
responsibilities throughout the [*** ***].  As [*** ***], some oversight of [***
***]  shall  be  conducted  by [*** ***], and shall be coordinated and scheduled
between  the  customer  and  [***  ***] shall support and schedule any [*** ***]
conducted  at  the  [***  ***] shall support the implementation of all [*** ***]
developed  by  the  [***  ***].
                                      PAGE

Confidential  treatment  has  been  requested for portions of this exhibit.  The
copy  filed herewith omits the information subject to a confidentiality request.
Omissions are designated [*** ***].  A complete version of this exhibit has been
filed  separately  with  the  Securities  and  Exchange  Commission.

3.4.4        [***  ***]

The [*** ***] shall include the [*** ***].  If required for contingency purposes
only,  access to [*** ***] will be [*** ***].  Provisions for [*** ***] shall be
provided  [*** ***] shall [*** ***] which will serve [*** ***] will provide [***
***].

3.4.5     Administrative  and  Storage  Facilities

Administrative  facilities  with desks, [*** ***], one [*** ***], one [*** ***],
one  [***  ***]  and any other necessary common [*** ***] shall be provided [***
***]  for  [***  ***].

Non-conditioned  storage  facilities  for [*** ***] and support equipment not in
use  shall  be  [***  ***]  by  [***  ***].

3.4.6     Support  Equipment

[***  ***]  shall provide the equipment necessary to transport, handle, test and
checkout  the  [***  ***],  and  integrate the encapsulated payload at [*** ***]
shall  provide  the [*** ***] required to [*** ***] the encapsulated payload and
[***  ***]  provided  [***  ***]  shall  provide  all  [***  ***].

3.4.7     Launch  Control  Organization

[***  ***]  shall  provide the [*** ***] with [*** ***] coordinated through [***
***],  and  a  coordinated  [***  ***]  shall  [***  ***].

3.4.8     Launch  Licensing

[***  ***]  will  generate  and  submit  the application for a commercial launch
license  from  the  Federal  Aviation  Administration.  Note that inputs will be
required  from  [***  ***].

                                      PAGEExhibit 10.6

 

NBTY, INC.
RETIREMENT SAVINGS AND

EMPLOYEES’ STOCK
OWNERSHIP PLAN

 

(Amended and
Restated Effective January 3, 2005)

 

 

NBTY, Inc.
Retirement Savings and Employees’ Stock Ownership Plan

(amended and restated effective January 3, 2005)

 

Table of Contents

 

	
   

  	
  Page

  
	
  ARTICLE 1
  TITLE AND CERTAIN OTHER GOVERNING PROVISIONS

  	
  1

  
	
   

  	
   

  
	
  ARTICLE 2
  DEFINITIONS

  	
  2

  
	
   

  	
   

  
	
  ARTICLE 3
  PARTICIPATION

  	
  10

  
	
   

  	
   

  
	
  Section 3.1. Eligibility

  	
  10

  
	
  Section 3.2. Election of
  Pre-Tax Contributions

  	
  10

  
	
  Section 3.3. Transfers to
  Affiliates

  	
  11

  
	
   

  	
   

  
	
  ARTICLE 4
  CONTRIBUTIONS

  	
  12

  
	
   

  	
   

  
	
  Section 4.1. Pre-Tax
  Contributions

  	
  12

  
	
  Section 4.2. Matching
  Contributions

  	
  13

  
	
  Section 4.3. Special
  Contributions

  	
  14

  
	
  Section 4.4. Form and
  Deposit of Contributions

  	
  15

  
	
  Section 4.5. Requirements for
  Rollover Contributions

  	
  16

  
	
  Section 4.6. Delivery of
  Rollover Contributions

  	
  17

  
	
   

  	
   

  
	
  ARTICLE 5
  ESOP CONTRIBUTIONS

  	
  17

  
	
   

  	
   

  
	
  Section 5.1. ESOP
  Contributions

  	
  17

  
	
  Section 5.2. Payment

  	
  18

  
	
  Section 5.3. Contributions by
  Participants

  	
  18

  
	
  Section 5.4. Maximum
  Contributions

  	
  18

  
	
  Section 5.5. Limitation on
  Annual Additions

  	
  19

  
	
   

  	
   

  
	
  ARTICLE 6
  LIMITATIONS ON CONTRIBUTIONS

  	
  19

  
	
   

  	
   

  
	
  Section 6.1. Annual Limit on
  Pre-Tax Contributions

  	
  19

  
	
  Section 6.2. Limits on
  Contributions for Highly Compensated Employees.

  	
  20

  
	
  Section 6.3. Maximum Annual
  Additions under Section 415 of the Code

  	
  26

  
	
  Section 6.4. Other Limitations
  on Employer Contributions

  	
  28

  
	
   

  	
   

  
	
  ARTICLE 7
  TRUST AND INVESTMENT FUNDS

  	
  29

  
	
   

  	
   

  
	
  Section 7.1. Trust

  	
  29

  
	
  Section 7.2. Designation of
  Investment Funds

  	
  29

  
	
  Section 7.3. Trust Fund to Be
  Applied Exclusively for Participants and their Beneficiaries, Etc

  	
  29

  
	
   

  	
   

  
	
  ARTICLE 8
  PARTICIPANT ACCOUNTS, INVESTMENT ELECTIONS, ETC.

  	
  30

  
	
   

  	
   

  
	
  Section 8.1. Participant
  Accounts

  	
  30

  
	
  Section 8.2. ESOP Account

  	
  31

  
	
  Section 8.3. Investment
  Elections

  	
  31

  
	
  Section 8.4. Valuation of
  Funds and Plan Accounts

  	
  34

  
	
  Section 8.5. Allocation of
  Contributions

  	
  34

  

 

	
   

  	
  Page

  
	
  Section 8.6. ESOP Allocations.

  	
  35

  
	
  Section 8.7. Voting and
  Exercising Other Securities Rights With Respect to NBTY Stock.

  	
  36

  
	
  Section 8.8. Allocation of
  Forfeitures.

  	
  37

  
	
  Section 8.9. Correction of
  Error

  	
  37

  
	
  Section 8.10. ERISA Section 404(c) Plan

  	
  38

  
	
  Section 8.11. Transfers from
  Other Plans

  	
  38

  
	
   

  	
   

  
	
  ARTICLE 9
  WITHDRAWALS AND DISTRIBUTIONS

  	
  39

  
	
   

  	
   

  
	
  Section 9.1. Withdrawals From
  Account Prior to Termination of Employment

  	
  39

  
	
  Section 9.2. Distribution of
  Account Upon Termination of Employment

  	
  42

  
	
  Section 9.3. Time and Form of
  Distribution of Account upon Termination of Employment

  	
  44

  
	
  Section 9.4. Distribution of
  ESOP Account

  	
  46

  
	
  Section 9.5. Payment of Small
  Account Balances

  	
  48

  
	
  Section 9.6. Order of
  Distribution

  	
  48

  
	
  Section 9.7. Direct Rollover
  Option

  	
  48

  
	
  Section 9.8. Designation of
  Beneficiary

  	
  49

  
	
  Section 9.9. Missing Persons

  	
  51

  
	
  Section 9.10. Distributions to
  Minor and Disabled Distributees

  	
  52

  
	
   

  	
   

  
	
  ARTICLE 10
  LOANS

  	
  52

  
	
   

  	
   

  
	
  Section 10.1. Making of Loans

  	
  52

  
	
  Section 10.2. Restrictions

  	
  53

  
	
  Section 10.3. Default

  	
  53

  
	
  Section 10.4. Applicability

  	
  54

  
	
   

  	
   

  
	
  ARTICLE 11
  ESOP LOANS

  	
  54

  
	
   

  	
   

  
	
  ARTICLE 12
  SPECIAL PARTICIPATION AND DISTRIBUTION RULES

  	
  56

  
	
   

  	
   

  
	
  Section 12.1. Change of
  Employment Status

  	
  56

  
	
  Section 12.2. Reemployment

  	
  56

  
	
  Section 12.3. Employment by
  Affiliates

  	
  59

  
	
  Section 12.4. Reemployment of
  Veterans

  	
  59

  
	
   

  	
   

  
	
  ARTICLE 13
  ADMINISTRATION

  	
  61

  
	
   

  	
   

  
	
  Section 13.1. The
  Administrator

  	
  61

  
	
  Section 13.2. Named Fiduciary

  	
  63

  
	
  Section 13.3. Allocation and
  Delegation of Responsibilities

  	
  63

  
	
  Section 13.4. Professional and
  Other Services

  	
  63

  
	
  Section 13.5. Claims Procedure

  	
  63

  
	
  Section 13.6. Notices to
  Participants, Etc

  	
  66

  
	
  Section 13.7. Notices to
  Administrator or Employers

  	
  66

  
	
  Section 13.8. Records

  	
  66

  
	
  Section 13.9. Reports of
  Trustee and Accounting to Participants

  	
  67

  

 

ii

	
   

  	
  Page

  
	
  ARTICLE 14
  PARTICIPATION BY EMPLOYERS

  	
  67

  
	
   

  	
   

  
	
  Section 14.1. Adoption of Plan

  	
  67

  
	
  Section 14.2. Withdrawal from
  Participation

  	
  67

  
	
  Section 14.3. Company,
  Administrator and Recordkeeper as Agents for Employers

  	
  68

  
	
  Section 14.4. Continuance by a
  Successor

  	
  68

  
	
   

  	
   

  
	
  ARTICLE 15
  MISCELLANEOUS

  	
  69

  
	
   

  	
   

  
	
  Section 15.1. Expenses

  	
  69

  
	
  Section 15.2.
  Non-Assignability.

  	
  69

  
	
  Section 15.3. Employment
  Non-Contractual

  	
  71

  
	
  Section 15.4. Merger or
  Consolidation with Another Plan

  	
  71

  
	
  Section 15.5. Gender and
  Plurals

  	
  71

  
	
  Section 15.6. Applicable Law

  	
  71

  
	
  Section 15.7. Severability

  	
  71

  
	
  Section 15.8. No Guarantee

  	
  72

  
	
  Section 15.9. Plan Voluntary

  	
  72

  
	
   

  	
   

  
	
  ARTICLE 16
  TOP-HEAVY PLAN REQUIREMENTS

  	
  72

  
	
   

  	
   

  
	
  Section 16.1. Top-Heavy Plan
  Determination

  	
  72

  
	
  Section 16.2. Definitions and
  Special Rules.

  	
  72

  
	
  Section 16.3. Minimum
  Contribution for Top-Heavy Years

  	
  73

  
	
  Section 16.4. Minimum Vesting
  for Top-Heavy Years

  	
  74

  
	
   

  	
   

  
	
  ARTICLE 17
  AMENDMENT, ESTABLISHMENT OF SEPARATE PLAN, AND PLAN TERMINATION

  	
  75

  
	
   

  	
   

  
	
  Section 17.1. Amendment

  	
  75

  
	
  Section 17.2. Establishment of
  Separate Plan

  	
  75

  
	
  Section 17.3. Termination

  	
  75

  

 

iii

 

ARTICLE 1

 

TITLE AND CERTAIN OTHER GOVERNING PROVISIONS

 

This
document shall be entitled the “NBTY, Inc. Retirement Savings and
Employees’ Stock Ownership Plan” (the “Plan”). 
This document is an amendment and restatement of the following three
plans:  the NBTY, Inc. 401(k)
Savings Plan, the Rexall Sundown, Inc. 401(k) Employee Savings Plan and
the NBTY, Inc. Employees’ Stock Ownership Plan, which were merged to form
this Plan effective January 3, 2005. 
The provisions of this amendment and restatement shall be effective January 3,
2005, except that any provision that specifies a different effective date shall
be effective as of the date specified.

 

The
rights and benefits of any participant whose employment with all Employers and
Affiliates terminates on or after January 3, 2005, and the rights and
benefits of any Beneficiary of any such participant, shall be determined solely
by reference to the terms of the Plan as amended and restated herein, as such
Plan may be amended from time to time. 
The rights and benefits of any participant whose employment with all
Employers and Affiliates terminated before January 3, 2005, and who is not
reemployed by an Employer or any Affiliate after such date, and the rights and
benefits of any Beneficiary of any such participant, shall be determined solely
by reference to the terms of the relevant predecessor plan named in the first
paragraph hereof as in effect on the date of such participant’s termination of
employment, except as otherwise required by law.  The word “participant” as used in Articles 1
through 17 refers to either a Participant, as defined in Section 2.32, or
a Rexall Participant, as defined in Section 2.42, and does not refer to an
ESOP Participant, as defined in Section 2.21.

 

The
Plan, other than provisions of the Plan addressing the employees’ stock
ownership plan portion of the Plan, is designated as a “profit sharing plan”
within the meaning of U.S. Treasury Regulation § 1.401-1(a)(2)(ii).  The employees’ stock ownership portion of the

 

 

Plan is designed to
invest primarily in qualifying employer securities, and the provisions of the
Plan related to the employees’ stock ownership plan are intended to meet the
requirements of a qualified employee stock ownership plan under sections
401(a), 501(a) and 4975(e)(7) of the Code.

 

ARTICLE 2

 

DEFINITIONS

 

As
used herein, the following words and phrases shall have the following
respective meanings when capitalized:

 

2.1           Account.  A Participant’s or a Rexall Participant’s
subaccounts described in Section 8.1 and such other subaccounts that may
be established from time to time on behalf of such a participant that are to be
credited with contributions made by the participant or on his or her behalf,
adjusted for earnings and losses, and debited by expenses and distributions to,
and withdrawals of, the participant; the term “Account” shall not include an
ESOP Participant’s ESOP Account.

 

2.2           Administrator.  The Company, as the administrator of the
Plan.

 

2.3           Affiliate.  (a) A corporation that is a member of
the same controlled group of corporations (within the meaning of section 414(b) of
the Code) as an Employer, (b) a trade or business (whether or not
incorporated) under common control (within the meaning of section 414(c) of
the Code) with an Employer, (c) any organization (whether or not
incorporated) that is a member of an affiliated service group (within the
meaning of section 414(m) of the Code) that includes an Employer, a
corporation described in clause (a) of this Section 2.3 or a trade or
business described in clause (b) of this Section 2.3, or (d) any
other entity that is required to be aggregated with an Employer pursuant to
U.S. Treasury regulations promulgated under section 414(o) of the Code.

 

2.4           Associate.  An individual whose relationship with an
Employer is, under common law, that of an employee.

 

2.5           Beneficiary.  A person entitled under Section 9.8 to
receive benefits in the event of the death of a Participant, a Rexall
Participant or an ESOP Participant.

 

2.6           Board.  The board of directors of the Company.

 

2.7           Catch-Up
Contribution.  The contribution
described in Section 4.1(b).

 

2.8           Code.  The Internal Revenue Code of 1986, as
amended.

 

2

 

2.9           Committee.  The Compensation and Stock Option Committee
of the Board.

 

2.10         Company.  NBTY, Inc., a Delaware corporation, and
any successor thereto.

 

2.11         Compensation.  Remuneration paid for services performed by a
Participant or a Rexall Participant for an Employer for a Plan Year while such
participant is an Eligible Associate or Eligible Rexall Associate that is
wages, tips and other compensation reported on his or her Form W-2 for
such Plan Year in the box that indicates compensation that is taxable for
federal income tax purposes (but determined without regard to any rules that
limit remuneration included in wages based upon the nature or location of the
employment), and compensation which is not currently includible in such
participant’s gross income by reason of the application of sections 125
(cafeteria plan), 132(f)(4) (qualified transportation fringe), and 402(e)(3) (salary
reduction deferrals to a 401(k) plan) of the Code, reduced by the aggregate of all amounts included on such Form W-2:

 

(i)            as
a result of the grant of stock awards, stock bonuses, restricted stock, stock
appreciation rights, phantom stock, stock options, stock units, stock
equivalences or similar arrangements;

 

(ii)           because
such amounts are imputed as income as a result of, or are paid in the nature of
or in relation to, benefits of the following types:  life insurance, short-term disability (other
than salary continuation payments), long-term disability, medical and other
welfare benefits;

 

(iii)          which
are separation, severance or supplemental unemployment benefits;

 

(iv)          which
are reimbursements or expense allowances (including moving expenses, housing
allowances but excluding car expenses and allowances); and

 

(v)           that
are payments that are nonreoccurring in nature.

 

Notwithstanding any
provision herein to the contrary, remuneration in excess of $210,000 (or such
other amount provided pursuant to section 401(a)(17) of the Code) shall be
disregarded.  If a determination period
consists of fewer than twelve (12) months, such annual Compensation limit will
be multiplied by a fraction, the numerator of which is the number of months in
the determination period, and the denominator of which is twelve (12).

 

2.12         Disability.  A Participant’s, Rexall Participant’s or an
ESOP Participant’s total and permanent physical or mental disability, as
determined by the Vice President of Human Resources or, if such Vice President
does not make a determination, the Director of Human Resources in accordance
with the Company’s normal personnel practice applied in a uniform and
nondiscriminatory manner.

 

2.13         Effective
Date.  The effective date of this
amendment and restatement of the Plan, with respect to any Employer as of January 2,
2005, shall be January 3, 2005, and, with 

 

3

 

respect to an entity that
becomes an Employer on or after January 3, 2005, shall be the date as of
which the Plan is adopted by such entity with the approval of the Company.

 

2.14         Eligible
Associate.  An Associate, other than
an Eligible Rexall Associate who was employed by Rexall Sundown, Inc. or
any of its subsidiaries before January 3, 2005, who (a) has attained
age 201⁄2 and (b) has been employed by an Employer for at least six
continuous months and either (i) is scheduled to work at least 1,000 Hours
of Service during the first twelve months of his or her employment with an
Employer or (ii) beginning with the first calendar year beginning in the
Associate’s first twelve months of employment with an Employer, has completed
at least 1,000 Hours of Service during any calendar year, except that an
Associate who performs services for the Vitamin World division shall not be an
Eligible Associate unless he or she is classified by his or her Employer as a
manager.  Notwithstanding the age and
service requirements described in this Section 2.14, an Associate who is
employed by Solgar, Inc. before January 1, 2006 shall be an Eligible
Associate.  Individuals who were
employees of Wyeth performing services solely in its Solgar Vitamin and Herb
operating unit at the Effective Time as defined in the Purchase Agreement by and
between Wyeth and NBTY, Inc. dated as of June 6, 2005 shall be
credited with Hours of Service under the Plan for their hours of service with
Wyeth and its affiliates, and individuals who were employees of Wyeth at such
Effective Time but who were on an approved leave of absence from the Solgar
Vitamin and Herb operating unit and who return to work for an Employer on or
before July 31, 2006 shall be credited with Hours of Service under the
Plan for their hours of service with Wyeth and its affiliates.  Notwithstanding
the previous sentences of this Section 2.14, no Ineligible Individual
shall be an Eligible Associate.

 

2.15         Eligible
Rexall Associate.  An Associate who (i) is
employed by Rexall Sundown, Inc. or any of its subsidiaries, (ii) was
employed by Rexall Sundown, Inc. or any of its subsidiaries before the
Effective Date, (iii) has attained age 18 but who has not yet attained age
20 1⁄2 as of the Effective Date and (iv) has completed at least 250 Hours of
Service, other than an Ineligible Individual.

 

2.16         Employer.  The Company or any Affiliate that, with the
consent of the Company, elects to participate in the Plan in the manner
described in Section 14.1.  If an
Employer withdraws from participation in the Plan pursuant to Section 14.2
or terminates its participation in the Plan pursuant to Section 17.3, it
shall thereupon cease to be an Employer. 
An entity shall cease being an Employer as of the date it ceases to be
an Affiliate, unless the Company consents to such entity’s continued
participation in the Plan.

 

2.17         ERISA.  The Employee Retirement Income Security Act
of 1974, as amended.

 

2.18         ESOP
Account.  An ESOP Participant’s
account described in Section 8.2, adjusted for earnings and losses, and
debited by expenses and distributions to the ESOP Participant or his or her
Beneficiary.

 

2.19         ESOP
Allocation Date.  December 31st
of each Plan Year.

 

4

 

2.20         ESOP
Compensation.   Remuneration paid for
services performed by an ESOP Participant for an Employer for a Plan Year while
the ESOP Participant is an Associate that is wages, tips and other compensation
reported on such ESOP Participant’s Form W-2 for such Plan Year in the box
that indicates compensation that is taxable for federal income tax purposes
(but determined without regard to any rules that limit remuneration
included in wages based upon the nature or location of the employment), and
compensation which is not currently includible in such ESOP Participant’s gross
income by reason of the application of sections 125 (cafeteria plan), 132(f)(4) (qualified
transportation fringe), and 402(e)(3) (salary reduction deferrals to a
401(k) plan) of the Code, reduced by
the aggregate of all amounts included on such Form W-2:

 

(i)            as
a result of the grant of stock awards, stock bonuses, restricted stock, stock
appreciation rights, phantom stock, stock options, stock units, stock
equivalences or similar arrangements;

 

(ii)           because
such amounts are imputed as income as a result of, or are paid in the nature of
or in relation to, benefits of the following types:  short-term disability (other than salary
continuation payments), long-term disability, medical and other welfare
benefits;

 

(iii)          which
are separation, severance or supplemental unemployment benefits;

 

(iv)          which
are reimbursements or expense allowances (including moving expenses, housing
allowances), and

 

(v)           that
are payments that are nonreoccurring in nature.

 

Notwithstanding any
provision herein to the contrary, remuneration in excess of $210,000 (or such
other amount provided pursuant to section 401(a)(17) of the Code) shall be
disregarded.  If a determination period
consists of fewer than twelve (12) months, such annual Compensation limit will
be multiplied by a fraction, the numerator of which is the number of months in
the determination period, and the denominator of which is twelve (12).

 

2.21         ESOP
Participant.  An Associate who has
satisfied the requirements of Section 3.1(b).

 

2.22         ESOP
Suspense Account.  The account to
which shares of NBTY Stock pledged as collateral for a loan to the Trust are
allocated pursuant to Section 8.6(e).

 

2.23         Fiscal
Year.  The twelve-month period ending
September 30.

 

2.24         Highly
Compensated Employee.  For any Plan
Year, any Associate who (i) is a 5%-owner (as determined under section 416(i)(1) of
the Code) at any time during such Plan Year or the immediately preceding Plan
Year or (ii) for the immediately preceding Plan Year, was paid
compensation in excess of $95,000 (as adjusted in accordance with section 414(q)(1)(B) of
the Code) from an Employer or Affiliate and was a member of the “top-paid group”
(as defined in section 414(q)(3) of the Code).

 

5

 

2.25         Hour
of Service.  (1)  Each hour for
which an Associate is directly or indirectly compensated or entitled to
compensation by an Employer for the performance of duties during the applicable
computation period; (2) each hour for which an Associate is directly or
indirectly compensated or entitled to compensation by an Employer (irrespective
of whether the employment relationship has terminated) for reasons other than
performance of duties (such as vacation, holidays, sickness, incapacity
(including disability), jury duty, lay-off, military duty or leave of absence)
during the applicable computation period (calculated and credited pursuant to
Department of Labor regulation § 2530.200b-2(b) and (c) which is
incorporated herein by reference); (3) each hour for which back pay is
awarded or agreed to by an Employer without regard to mitigation of damages
(credited to the Associate for the computation period or periods to which the
award or agreement pertains rather than the computation period in which the
award, agreement or payment is made). 
The same Hours of Service shall not be credited both under (1) or
(2), as the case may be, and under (3).

 

Notwithstanding
(2) above, (i) no more than 501 Hours of Service are required to be
credited to an Associate on account of any single continuous period during
which the Associate performs no duties (whether or not such period occurs in a
single computation period); (ii) an hour for which an Associate is
directly or indirectly paid, or entitled to payment, on account of a period
during which no duties are performed is not required to be credited to the Associate
if such payment is made or due under a plan maintained solely for the purpose
of complying with applicable workers’ compensation, or unemployment
compensation or disability insurance laws; and (iii) Hours of Service are
not required to be credited for a payment which solely reimburses an Associate
for medical or medically related expenses incurred by the Associate.

 

2.26         Ineligible
Individual.  Notwithstanding any
provision of the Plan to the contrary, an individual who renders services for
an Employer shall not be an Eligible Associate, an Eligible Rexall Associate or
an ESOP Participant if (i) the terms of his or her employment are subject
to a collective bargaining agreement which does not provide for the
participation of such individual in the Plan; (ii) the individual renders
services pursuant to an agreement or arrangement (written or oral) (a) that
such services are to be rendered as an independent contractor; (b) with an
entity, including a leasing organization within the meaning of section 414(n)(2) of
the Code, that is not an Employer or Affiliate; or (c) that contains a
waiver of participation in the Plan; or (iii) he or she is not treated as
an employee of an Employer on an Employer’s payroll records (notwithstanding
any determination by a court or administrative agency that such individual is
an employee).

 

2.27         Matching
Account.  The subaccount established
pursuant to Section 8.1 to which any Matching Contributions made for the
benefit of a Participant or Rexall Participant pursuant to Section 4.2 or
4.3(b), and earnings and losses thereon, are credited.

 

2.28         Matching
Contribution.  The contribution made
by an Employer pursuant to Section 4.2 or 4.3(b) or pursuant to a
Prior Plan.

 

2.29         Maximum
Deferral Percentage.  The maximum
percentage of a Participant’s or a Rexall Participant’s Compensation for a
payroll period that may be contributed to the Plan pursuant to Section 4.1
or 4.3(a), as determined from time to time by the 

 

6

 

Administrator.  The Administrator in its sole discretion may,
for any Plan Year, establish a Maximum Deferral Percentage for participants who
are not Highly Compensated Employees that is different from the Maximum
Deferral Percentage for participants who are Highly Compensated Employees for
such Plan Year, and further, may establish different Maximum Deferral
Percentages for various classes of Highly Compensated Employees for a given
Plan Year, provided that any such Maximum Deferral Percentages will not
discriminate, within the meaning of section 401(a)(4) of the Code, in
favor of Highly Compensated Employees.

 

2.30         NBTY
Stock.  Shares of common capital
stock of NBTY, Inc. which constitute “employer securities” within the
meaning of section 4975(e)(8) of the Code.

 

2.31         1-Year
Break in Service.  The applicable
computation period during which an Associate or former Associate has not
completed more than 500 Hours of Service. 
Solely for the purpose of determining whether an Associate or former
Associate has incurred a 1-Year Break in Service, Hours of Service shall be
recognized for any “authorized leave of absence” and any “maternity or
paternity leave of absence.”  For this
purpose, Hours of Service shall be credited for the computation period in which
the absence from work begins, only if credit therefore is necessary to prevent
the Associate from incurring a 1-Year Break in Service, and, in any other case,
in the immediately following computation period.  The Hours of Service credited for a “maternity
or paternity leave of absence” shall be those which would normally have been
credited but for such absence, or, in any case in which the Administrator is
unable to determine such hours normally credited, eight (8) Hours of
Service per day.  The total Hours of
Service required to be credited for a “maternity or paternity leave of absence”
shall not exceed the number of Hours of Service needed to prevent the Associate
from incurring a 1-Year Break in Service.

 

“Authorized
leave of absence” means an unpaid, temporary cessation from active employment
with the Employer pursuant to an established nondiscriminatory policy, whether
occasioned by illness, military service, or any other reason.

 

A “maternity
or paternity leave of absence” means an absence from work for any period by
reason of the Associate’s pregnancy, birth of the Associate’s child, placement
of a child with the Associate in connection with the adoption of such child, or
any absence for the purpose of caring for such child for a period immediately
following such birth or placement.

 

2.32         Participant.  An Eligible Associate who (i) is not a
Rexall Participant and (ii) has satisfied the requirements set forth in Section 3.1.  An individual shall cease to be a Participant
upon the complete distribution of his or her vested Account.  Notwithstanding the foregoing, an individual
who ceases to be a Participant may nonetheless continue to be an ESOP
Participant.

 

2.33         Plan.  The NBTY, Inc. Retirement Savings and
Employees’ Stock Ownership Plan herein set forth, as the same may from time to
time be amended.

 

2.34         Plan
Year.  The calendar year.

 

7

 

2.35         Pre-Tax
Account.  The subaccount established
pursuant to Section 8.1 to which any Pre-Tax Contributions made for the
benefit of a Participant or Rexall Participant pursuant to Section 4.1 or
4.3(a), and earnings and losses thereon, are credited.

 

2.36         Pre-Tax
Contribution.  The contribution to
the Plan made by an Employer on behalf of a Participant pursuant to Section 4.1
or 4.3(a) or pursuant to a Prior Plan.

 

2.37         Prior
Plan.  Any of the NBTY, Inc.
401(k) Savings Plan, the Rexall Sundown, Inc. 401(k) Employee Savings
Plan, or the NBTY, Inc. Employee Stock Ownership Plan, as the context
requires.

 

2.38         Profit
Sharing Account.  The account
established pursuant to Section 8.1 to which Profit Sharing Contributions
that had been made for the benefit of a Rexall Participant under a Prior Plan,
and earnings and losses thereon, were credited.

 

2.39         Profit
Sharing Contribution.  The
contribution made pursuant to a Prior Plan on behalf of a Rexall Participant
pursuant to such Prior Plan.

 

2.40         Qualified
Military Service.  An individual’s
service in the uniformed services (as defined in 38 U.S.C. § 4303) if such
individual is entitled to reemployment rights under USERRA with respect to such
service.

 

2.41         Recordkeeper.  Fidelity Investments Investment Institutional
Operations Company, Inc.

 

2.42         Rexall
Participant.  An Eligible Rexall
Associate who has satisfied the requirements set forth in Section 3.1(a).  An individual shall cease to be an Rexall
Participant upon the earlier of (i) the complete distribution of his or
her vested Account and (ii) the date such individual becomes employed by
an Employer other than Rexall Sundown, Inc. or any of its subsidiaries.  Notwithstanding the foregoing, an individual
who ceases to be a Rexall Participant may nonetheless continue to be an ESOP
Participant.

 

2.43         Rollover
Account.  The subaccount established
pursuant to Section 8.1 to which any Rollover Contributions, and earnings
and losses thereon, are credited.

 

2.44         Rollover
Contribution.  A contribution to the
Plan made pursuant to Section 4.5 of the Plan.

 

2.45         Special
Bonus Account.  The account
established pursuant to Section 8.1 to which a Special Bonus Contribution
made for the benefit of a Participant pursuant to Section 4.3(c), and
earnings and losses thereon, are credited.

 

2.46         Special
Bonus Contribution.  The contribution
made to the Plan pursuant to Section 4.3(c) on behalf of Participants
described in such Section.

 

2.47         Taxable
Wage Base.  The maximum amount of
earnings that may be considered wages under section 3121(a)(1) of the
Code for purposes of old-age, survivors and 

 

8

 

disability insurance tax under
section 3101 of the Code as in effect on the first day of a Plan Year.

 

2.48         Top-Heavy
Plan Account.  The subaccount
established pursuant to Section 8.1 to which any contributions made for
the benefit of a Participant, Rexall Participant or ESOP Participant pursuant
to Section 16.3, and earnings and losses thereon, are credited.

 

2.49         Trust.  The trust described in Section 7.1 and
established pursuant to an agreement between the Company and the Trustee.

 

2.50         Trust
Fund.  All money and property of every
kind of the Trust held by the Trustee pursuant to the terms of the agreement
governing the Trust.

 

2.51         Trustee.  The person or entity appointed by the Company
and serving as trustee of the Trust or, if there is more than one such trustee
acting at a particular time, all of such trustees collectively.

 

2.52         USERRA.  The Uniformed Services Employment and
Reemployment Rights Act of 1994, as amended.

 

2.53         Valuation
Date.  Each day on which the New York
Stock Exchange is open for trading.

 

2.54         Year
of Service.  The computation period
of twelve (12) consecutive months, herein set forth, and during which an
Associate has completed at least 1,000 Hours of Service.

 

For
purposes of eligibility for participation in the Plan, the initial computation
period shall begin with the date on which an Associate first performs an Hour
of Service.  The initial computation
period beginning after a 1-Year Break in Service shall be measured from the
date on which an Associate again performs an Hour of Service.  The computation period after the initial
computation period shall shift to the current Plan Year which includes the
six-month anniversary of the date on which an Associate first performed an Hour
of Service, and subsequent computation periods for vesting purposes shall be
the Plan Year.

 

For
vesting purposes, and all other purposes not specifically addressed in the
above paragraph, the computation period shall be the Plan Year.

 

For an
Eligible Rexall Associate, periods of twelve (12) consecutive months during
which the Eligible Rexall Associate completed at least 1,000 hours of service
within the meaning of Department of Labor regulation § 2530.200b-2 with
Richardson Labs, Inc. and MET-Rx USA, Inc. will be recognized for
eligibility and vesting purposes.

 

For an
Eligible Associate, years of service with Wyeth as reflected on the records of
the Wyeth Savings Plan – United States on the Effective Time of the Purchase
Agreement by and between Wyeth and NBTY, Inc. dated as of June 6,
2005 will be recognized as Years of Service hereunder for eligibility and
vesting purposes.

 

9

 

ARTICLE 3

 

PARTICIPATION

 

Section 3.1.         Eligibility.  (a)  
In General.  (i) Each
Eligible Associate and Eligible Rexall Associate who was a participant in the
NBTY, Inc. 401(k) Savings Plan or the Rexall Sundown, Inc. 401(k)
Employee Savings Plan immediately before the Effective Date shall be a
Participant or a Rexall Participant, as the case may be, on the Effective Date,
(ii) each Eligible Associate who is employed by Solgar, Inc. prior to
January 1, 2006 shall become eligible to become a Participant immediately
upon becoming an Eligible Associate and (iii) each other Eligible
Associate shall become eligible to become a Participant on the first day of the
month coinciding with or next following the date on which such Associate became
an Eligible Associate.

 

(b)   Eligibility for
ESOP Participation.  Each Associate
who was a participant in the NBTY, Inc. Employees’ Stock Ownership Plan
immediately before the Effective Date shall be an ESOP Participant on the
Effective Date.  Each other Associate
shall become an ESOP Participant as of the January 1st or July 1st
coincident with or next following the date he or she has completed a Year of
Service, provided that the Associate has attained age 20 1⁄2 and further provided
that the Associate is not an Ineligible Individual.  An Associate shall be credited for service
with Nutrition Headquarters, Inc. and Nutro Laboratories, Inc. for
all purposes with respect to the employee stock ownership provisions of the
Plan.  With respect to the employees’
stock ownership provisions of the Plan, an Associate shall be credited for
service with Rexall Sundown, Inc. or any subsidiary thereof, but only for
purposes of determining eligibility to participate in the employees’ stock
ownership plan portion of the Plan.

 

Section 3.2.         Election
of Pre-Tax Contributions.  An
Associate who satisfies the requirements of Section 3.1(a) and who
desires to make Pre-Tax Contributions to the Plan shall 

 

10

 

make an election,
in accordance with procedures prescribed by the Administrator, specifying the
Associate’s chosen rate of such contributions. 
Such election (x) shall authorize such Associate’s Employer to reduce
such Associate’s Compensation by the amount of any such Pre-Tax Contributions,
(y) shall specify such Associate’s investment election as described in Section 8.3
and (z) shall evidence such Associate’s acceptance and agreement to all
provisions of the Plan.  Any election
made pursuant to this Section 3.2 shall be effective only with respect to
Compensation not immediately available to the Associate as of the effective
date of such election and shall be effective as of the first payroll period commencing
after the date on which the election is received, or such later date as may be
administratively practicable.

 

Section 3.3.         Transfers
to Affiliates.  If the employment of
a Participant, Rexall Participant or ESOP Participant is transferred from an Employer
to an Affiliate that is not an Employer, the employment transfer shall not
cause such participant’s or ESOP Participant’s (as the case may be)
participation in the Plan to terminate, and he or she shall continue to
participate in the Plan until an event occurs which would entitle such
participant to a complete distribution of his or her vested Account balance and
such ESOP Participant to a complete distribution of his or her vested ESOP
Account balance had he or she continued to be employed by an Employer until the
occurrence of such event. 
Notwithstanding the foregoing, a Participant or Rexall Participant shall
not be entitled to make Pre-Tax Contributions or Rollover Contributions or to
receive allocations of Matching Contributions under the Plan, and an ESOP
Participant shall not receive allocations of any employee stock ownership plan
contributions during any period of employment by an Affiliate that is not an
Employer, and periods of employment by an Affiliate that is not an Employer
shall be taken into account only to the extent set forth in Section 12.4.

 

11

 

ARTICLE 4

 

CONTRIBUTIONS

 

Section 4.1.         Pre-Tax
Contributions.  (a)    Elections.  Subject to the limitations set forth in Article 6
and except as provided in Section 4.3(a), each Employer shall make a
Pre-Tax Contribution for each payroll period on behalf of each Participant and
each Rexall Participant of such
Employer in an amount equal to a percentage of such participant’s Compensation
for such payroll period as elected by such participant pursuant to Section 3.2.  The percentage of Compensation so designated
by a Participant for a payroll period may not be more than 50%, and the
percentage of Compensation so designated by a Rexall Participant may not be
more than the limits of sections 401(k), 402(g), 404, and 415 of the Code.   Notwithstanding the foregoing, a participant’s
Pre-Tax Contributions for a payroll period pursuant to this Section 4.1(a) may
not exceed an amount equal to the Maximum Deferral Percentage for such payroll
period with respect to such participant. 
Before January 1, 2006, a Participant’s elections shall be made at
such time and in such manner as may be prescribed by the Administrator or the
Recordkeeper and shall be effective as of the first day of the next month, and
a Rexall Participant’s elections shall be made at such time and in such manner
as may be prescribed by the Administrator or the Recordkeeper and shall be
effective as of the first day of the next payroll period.  On or after January 1, 2006, a
participant’s elections shall be made at such time and in such manner as may be
prescribed by the Administrator or the Recordkeeper and shall be effective as
of the first day of any payroll period or, if later, as soon as
administratively practicable.  A
participant’s Pre-Tax Contributions shall continue in effect at the rate
elected by such a participant pursuant to Section 3.2 until the
participant changes or suspends such election. 
A participant who has suspended Pre-Tax Contributions pursuant to 

 

12

 

this subsection may
resume Pre-Tax Contributions by making an election at such time and in such
manner as may be prescribed by the Administrator or the Recordkeeper.

 

(b)   Catch-Up
Contributions.  Each Participant and
Rexall Participant who (i) is eligible to have Pre-Tax Contributions made
on his or her behalf under the Plan and (ii) will attain age 50 before the
end of a calendar year ending with or within a Plan Year shall be eligible to
have Pre-Tax Contributions made on his or her behalf in addition to those
described in Section 4.1(a) or 4.3(a) (“Catch-Up Contributions”)
so long as plan deferral limits and the requirements of section 402(g) of
the Code have been met.  Catch-up
Contributions shall be elected, made, suspended, resumed and credited in
accordance with and subject to the rules and limitations of section 414(v) of
the Code and such other rules and limitations prescribed by the
Administrator or the Recordkeeper from time to time; provided, however,
that (i) the amount of Catch-up Contributions made on behalf of a
participant during a calendar year shall not exceed the maximum amount
permitted under section 414(v)(2) of the Code for the calendar year
($4,000 for 2005); (ii) the amount of Catch-up Contributions made on
behalf of a participant for a payroll period shall not exceed the percentage of
such participant’s Compensation that is established from time to time by the
Administrator; and (iii) no Matching Contributions shall be made pursuant
to Section 4.2 or 4.3(b) in connection with Catch-up
Contributions.  Catch-up Contributions
shall not be taken into account for purposes of Sections 6.1 and 6.3, and the
Plan shall not be treated as failing to satisfy its provisions implementing the
requirements of sections 401(k)(3), 401(k)(11), 401(k)(12), 410(b) or 416
of the Code, as applicable, by reason of such Catch-up Contributions.

 

Section 4.2.            Matching
Contributions.  Subject to the
limitations set forth in Article 6, an Employer may make a Matching
Contribution for each payroll period on behalf of 

 

13

 

each Participant
or Rexall Participant who is an employee of such Employer.  Except as provided in Section 4.3(b), the
Matching Contribution shall equal a discretionary percentage, to be determined
by the Company, of such a participant’s Pre-Tax Contribution.  The Company may decide that the Matching
Contribution will be made only with respect to a certain percentage or dollar
amount of a participant’s Compensation and the Company’s decision will be
applied (a) uniformly with respect to all Rexall Participants and (b) uniformly
with respect to all Participants; provided, however, that with
respect to Matching Contributions attributable to Compensation earned prior to January 1,
2006, the Company may decide that the basis for the Matching Contribution for
Participants who are performing services for Solgar, Inc. made pursuant to
Section 4.3(b) will be different from the basis for the Matching
Contribution for other Participants or Rexall Participants.  The Matching Contribution made on behalf of a
Rexall Participant for any Plan Year shall not exceed $3,000.

 

Section 4.3.            Special
Contributions.  Notwithstanding
anything herein to the contrary and in lieu of the contributions described in
Sections 4.1(a) and 4.2 for the period beginning on the Effective Time as
defined in the Purchase Agreement by and between Wyeth and NBTY, Inc.
dated as of June 6, 2005 (the “Wyeth Purchase Agreement”) and ending December 31,
2005 (such period, the “Solgar Period”), the Company shall make or cause Solgar, Inc.
to make the contributions described in Section 4.3(a), (b) and (c) on
behalf of certain Participants described in such subsections.

 

(a)   Special Pre-Tax
Contribution.  Subject to the
limitations set forth in Article 6, a Pre-Tax Contribution shall be made
for each payroll period beginning in the Solgar Period on behalf of each
Participant who is an Associate performing services for Solgar, Inc.
during any such payroll period in an amount equal to a percentage of such
Participant’s Compensation for 

 

14

 

such payroll period as elected by the Participant pursuant to Section 3.2.  The percentage of Compensation so designated
by such a Participant for a payroll period may not be less than 1% and may not
be more than 16% and may be changed or suspended in accordance with procedures
established by the Recordkeeper.  
Notwithstanding the foregoing, a Participant’s Pre-Tax Contributions for
a payroll period pursuant to this Section 4.3(a) may not exceed an
amount equal to the Maximum Deferral Percentage for such payroll period with
respect to such Participant.

 

(b)   Special
Matching Contribution.  Subject to
the limitations set forth in Article 6, a Matching Contribution shall be
made for each payroll period in the Solgar Period on behalf of each Participant
who is an Associate performing services for Solgar, Inc. during any such
payroll period.  The Matching
Contribution shall equal 50% of the Compensation which the Participant elects
to defer as a Pre-Tax Contribution for such payroll period, provided that such
Matching Contribution shall be made only with respect to the first 6% of such
Compensation.

 

(c)   Special Bonus
Contribution.  The Company shall make
a Special Bonus Contribution on behalf of each Participant who (i) was an
employee of Wyeth performing services in its Solgar Vitamin and Herb operating
unit at the Effective Time as defined in the Wyeth Purchase Agreement and (ii) is
an Associate of an Employer on December 31, 2005.  The amount of the Special Bonus Contribution
made on behalf of such a Participant shall equal $325 multiplied by the number
of whole years of service such Participant had with Wyeth as of such Effective
Time, as reflected on Wyeth’s records immediately prior to the Effective Time.

 

Section 4.4.            Form and
Deposit of Contributions.  The
contributions described in Sections 4.1, 4.2 and 4.3 shall be made in
cash.  The Company shall deliver or cause
to be delivered to the Trustee Pre-Tax Contributions for each payroll period as
soon as 

 

15

 

administratively
practicable after the date such contributions otherwise would have been paid to
participants as cash compensation, but in no event later than the 15th
business day of the month following the month during which such contributions
otherwise would have been paid to the participants.  The Company shall deliver or cause to be
delivered to the Trustee any Matching Contributions for a payroll period
concurrently with the delivery of the Pre-Tax Contributions to which such
Matching Contributions relate.  The
Company shall deliver or cause to be delivered to the Trustee the contribution described
in Section 4.3(c) on or before March 15, 2006.

 

Section 4.5.            Requirements
for Rollover Contributions.  If an
Associate who (i) is an Eligible Associate or Eligible Rexall Associate or
(ii) will become an Eligible Associate upon satisfying the age and service
requirements described in Section 2.13, receives,
or is entitled to, an “eligible rollover distribution” (within the meaning of section 402(c)(4) of
the Code) from an employees’ trust described in section 401(a) of the
Code that is exempt from tax under section 501(a) of the Code, from a
qualified annuity plan described in section 403(a) of the Code, from
a 403(b) plan, from a governmental 457(b) plan, or from an individual
retirement account or annuity described in section 408(a) or (b) of
the Code (provided that such amount is eligible to be rolled over from such
individual retirement account or annuity and no amount in such individual
retirement account or annuity is attributable to any source other than an
eligible rollover distribution from an employees’ trust described in section 401(a) of
the Code that is exempt from tax under section 501(a) of the Code or
from a qualified annuity plan described in section 403(a) of the
Code, and any earnings thereon), then he or she may contribute, or direct the
Trustee of such trust, plan, account or annuity to transfer to the Plan an
amount that does not exceed the amount of such eligible rollover distribution
(including the 

 

16

 

proceeds from the
sale of any property received as part of such eligible rollover distribution),
provided that such eligible rollover distribution will not jeopardize the
tax-exempt status of the Plan or create adverse tax consequences for an
Employer.  Notwithstanding the foregoing,
such a contribution (a “Rollover Contribution”) to the Plan may not include any
portion of an eligible rollover distribution that consists of after-tax
employee contributions.  A Rollover
Contribution may be in the form of cash or, with the consent of the
Administrator or the Recordkeeper, a promissory note evidencing an outstanding
loan balance.

 

Section 4.6.            Delivery
of Rollover Contributions.  Any
Rollover Contribution to the Plan shall be delivered to the Trustee by an
Eligible Associate or Eligible Rexall Associate on or before the 60th day after
the day on which such an Associate receives the Rollover Contribution (or on or
before such later date as may be prescribed by law) or shall be transferred to
the Trustee on behalf of such Associate directly from the trust from which the
eligible rollover distribution referred to in Section 4.5 is made.  Any such Rollover Contribution must be
accompanied by any information or documentation in connection therewith
requested by the Administrator, the Recordkeeper or the Trustee.  Notwithstanding the foregoing, the
Administrator or the Recordkeeper shall not permit a Rollover Contribution if
in the judgment of either accepting such Rollover Contribution would cause the
Plan to violate any provision of the Code or U.S. Treasury regulations or
create adverse tax consequences for an Employer.

 

ARTICLE 5

 

ESOP CONTRIBUTIONS

 

Section 5.1.            ESOP
Contributions.  For each Plan Year,
the Company will contribute (an “ESOP Contribution”) on behalf of the Employers
in cash or NBTY Stock the amounts, if any, that the Committee, in its sole
discretion, may authorize and direct to be contributed.  ESOP Contributions will be allocated to ESOP
Participants’ ESOP Accounts.  

 

17

 

ESOP Contributions
will be allocated to ESOP Participants who have completed at least 1,000 Hours
of Service during the Plan Year for which such ESOP Contribution is made and
who are employed on the last day of such Plan Year.  For each ESOP Contribution, an allocation
will be made to each ESOP Participant’s ESOP Account in the ratio that the ESOP
Participant’s ESOP Compensation for such Plan Year bears to the ESOP
Compensation for such Plan Year of all ESOP Participants.

 

Section 5.2.            Payment.  The total contributions made pursuant to Article 5
for a Plan Year shall be made in one or more installments, not later than the
due date (including extensions thereof) for filing the federal income tax
return of the Company for its Fiscal Year ending immediately after the end of
such Plan Year for which the ESOP Contributions are made.  Any ESOP Contribution made in cash shall, in
the sole discretion of the Company, be (i) used to purchase available NBTY
Stock or (ii) allocated to Participant’s ESOP Accounts; provided, however,
that to the extent required, any cash contributions shall be used to repay any
portion of a loan incurred as permitted under Article 11.

 

If an
ESOP Contribution is made in shares of NBTY Stock, NBTY Stock shall be valued
at the closing price of NBTY Stock on the day of the contribution of NBTY
Stock.  If at any time NBTY Stock is not
readily tradable on an established securities market, then any valuation
required under this Section 5.2 will be conducted by an independent
appraiser (as defined in section 401(a)(28) of the Code).

 

Section 5.3.            Contributions
by Participants.  ESOP Participants
shall not be permitted to make any contributions to their ESOP Accounts.

 

Section 5.4.            Maximum
Contributions.  The aggregate amount
of ESOP contributions for any Plan Year shall not exceed twenty-five percent
(25%) of the aggregate 

 

18

 

compensation (as
defined in section 415(c)(3) of the Code) of all ESOP Participants
during such Plan Year, except as provided in this Section 5.4.  For any Plan Year with respect to which ESOP
Contributions are applied to repay any portion of a loan incurred pursuant to Article 11,
the total amount of ESOP Contributions used to repay principal on all such
loans shall not exceed twenty-five percent (25%) of such aggregate ESOP
Participant compensation for such Plan Year. 
The Company may contribute any amount in excess of this maximum amount
for the Plan Year, without limitation, for the purpose of paying interest on
such loans.  Furthermore, the
contributions made pursuant to this Article, when combined with all
tax-qualified plans of the Employers, shall not exceed the maximum allowable
deductions permitted under section 404 of the Code.

 

Section 5.5.            Limitation
on Annual Additions.  Notwithstanding
anything contained herein to the contrary, allocation of ESOP Contributions for
any Plan Year shall be subject to the limitations set forth in Section 6.3.

 

ARTICLE 6

 

LIMITATIONS ON CONTRIBUTIONS

 

Section 6.1.            Annual
Limit on Pre-Tax Contributions.  (a)    General Rule.  Notwithstanding the provisions of Section 4.1
or 4.3(a), Pre-Tax Contributions made on behalf of a Participant or Rexall
Participant pursuant to such Section for any calendar year shall not
exceed the dollar limitation in effect for such calendar year under section 402(g) of
the Code, except to the extent permitted under Section 4.1(b) of the
Plan and section 414(v) of the Code.

 

(b)   Excess Pre-Tax
Contributions.  Except to the extent
set forth in Section 4.1(b) of the Plan and section 414(v) of
the Code with respect to “catch-up contributions,” if for any calendar year the
Pre-Tax Contributions to the Plan or the aggregate of the Pre-Tax Contributions
to the Plan plus amounts contributed under other plans or arrangements described

 

19

 

in section 401(k),
403(b), 408(k) or 408(p) of the Code for a participant exceed the limit imposed
by subsection (a) of this Section for such calendar year (“excess
deferrals”), such participant shall, pursuant to rules and at a time
following such calendar year as determined by the Administrator, be allowed to
submit a written request, accompanied by documentation evidencing that such
excess deferrals exist, that the excess deferrals, plus any income and minus
any loss allocable thereto, be distributed to the participant.  The amount of any income or loss allocable to
such excess deferrals shall be determined pursuant to regulations promulgated
by the U.S. Department of Treasury or U.S. Department of Labor.  Such amount of excess deferrals, as adjusted
for income or loss, shall be distributed to the participant no later than April 15
following the calendar year for which such contributions were made.  Notwithstanding the provisions of this subsection (b),
any such excess deferrals shall be treated as “annual additions” for purposes
of Section 6.3 for the limitation year in which such contributions were
made.  The amount of excess deferrals
that may be distributed under this subsection (b) with respect to a
participant for a calendar year shall be reduced by any amounts previously
distributed pursuant to Section 6.2(e)(1) with respect to such
participant for such year.

 

Section 6.2.         Limits
on Contributions for Highly Compensated Employees.

 

(a)   Actual Deferral
Percentage Test Imposed by Section 401(k)(3) of the Code.  Notwithstanding the provisions of Section 4.1
and 4.3(a), if the Pre-Tax Contributions made pursuant to Section 4.1 and
4.3(a) for a Plan Year fail, or in the judgment of the Administrator or
the Recordkeeper are likely to fail, to satisfy both of the tests set forth in
paragraphs (1) and (2) of this subsection, the adjustments prescribed
in Section 6.2(e)(1) shall be made. 
Any Pre-Tax Contributions which are “Catch-up Contributions” shall not
be considered to be Pre-Tax Contributions for purposes of determining whether
the tests set forth in paragraphs (1) and (2) of 

 

20

 

this subsection are
satisfied or for purposes of making any adjustments prescribed by Section 6.2(e)(1).

 

(1)  The HCE average deferral percentage (as
defined below) for such year does not exceed the product of the NHCE average
deferral percentage (as defined below) for such year and 1.25.

 

(2)  The HCE average deferral percentage for such
year (i) does not exceed the NHCE average deferral percentage for such
year by more than two percentage points and (ii) does not exceed the
product of the NHCE average deferral percentage for such year and 2.0.

 

(b)   Actual
Contribution Percentage Test Imposed by Section 401(m) of the Code.  Notwithstanding the provisions of Section 4.2
and 4.3(b), if the aggregate of the Matching Contributions made pursuant to Section 4.2
and 4.3(b) for a Plan Year fail, or in the judgment of the Administrator
or the Recordkeeper are likely to fail, to satisfy both of the tests set forth
in paragraphs (1) and (2) of this subsection, the adjustments
prescribed in Section 6.2(e)(2) shall be made.

 

(1)  The HCE average contribution percentage (as
defined below) for such year does not exceed the product of the NHCE average
contribution percentage (as defined below) for such year and 1.25.

 

(2)  The HCE average contribution percentage for
such year (i) does not exceed the NHCE average contribution percentage for
such year by more than two percentage points and (ii) does not exceed the
product of the NHCE average contribution percentage for such year and 2.0.

 

(c)   Definitions and
Special Rules.  For purposes of this
Section, the following definitions and special rules shall apply:

 

(1)  The “actual deferral percentage test” refers
collectively to the tests set forth in paragraphs (1) and (2) of subsection (a) of
this Section relating to Pre-Tax Contributions.  The actual deferral percentage test shall be
satisfied if either of such tests are satisfied.

 

(2)  The “HCE average deferral percentage” for a
Plan Year is a percentage determined for the group of Eligible Associates and
Eligible Rexall Associates who are eligible to make Pre-Tax Contributions for
the current Plan Year and who are Highly Compensated Employees for the current
Plan Year and the prior Plan Year.  Such
percentage shall be equal to the average of the ratios, calculated separately
for each such 

 

21

 

Eligible
Associate and Eligible Rexall Associate to the nearest one-hundredth of one
percent, of the Pre-Tax Contributions for the benefit of such individual for
the current Plan Year (if any) to the total compensation for the current Plan
Year paid to such individual.

 

(3)  The “NHCE average deferral percentage” for a
Plan Year is a percentage determined for the group of Eligible Associates and
Eligible Rexall Associates who are eligible to make Pre-Tax Contributions for
the current Plan Year and who are not Highly Compensated Employees for the
current Plan Year.  Such percentage shall
be equal to the average of the ratios, calculated separately for each such
Eligible Associate and Eligible Rexall Associate to the nearest one-hundredth
of one percent, of the Pre-Tax Contributions for the benefit of such individual
for the immediately preceding Plan Year (if any) to the total compensation for
the immediately preceding Plan Year paid to such individual.

 

(4)  The “actual contribution percentage test”
refers collectively to the tests set forth in paragraphs (1) and (2) of
subsection (b) of this Section relating to Matching
Contributions.  The actual contribution
percentage test shall be satisfied if either of such tests are satisfied.

 

(5)  The “HCE average contribution percentage”
for a Plan Year is a percentage determined for the group of Eligible Associates
and Eligible Rexall Associates who are eligible to have Matching Contributions,
or in the discretion of the Company and to the extent permitted under rules prescribed
by the Secretary of the Treasury or otherwise under the law, Pre-Tax
Contributions, made for their benefit for the current Plan Year and who are
Highly Compensated Employees for the current Plan Year.  Such percentage shall be equal to the average
of the ratios, calculated separately for each such Eligible Associate and
Eligible Rexall Associate to the nearest one-hundredth of one percent, of the
Matching Contributions and, in the discretion of the Administrator or the
Recordkeeper and to the extent permitted under rules prescribed by the
Secretary of the Treasury or otherwise under the law, Pre-Tax Contributions,
made for the benefit of such individual for the current Plan Year (if any) to
the total compensation for the current Plan Year paid to such individual.

 

(6)  The “NHCE average contribution percentage”
for a Plan Year is a percentage determined for the group of Eligible Associates
and Eligible Rexall Associates who are eligible to have Matching Contributions,
or in the discretion of the Company and to the extent permitted under rules prescribed
by the Secretary of the Treasury or otherwise under the law, Pre-Tax
Contributions, made for their benefit for the current Plan Year and who are not
Highly Compensated Employees for the current Plan Year.  Such percentage shall be equal to the average
of the ratios, calculated separately for each such Eligible Associate and
Eligible Rexall Associate to the nearest one-hundredth of one percent, of the
Matching Contributions and, in the discretion of the Administrator or the
Recordkeeper and to the extent permitted under rules prescribed by the
Secretary of the Treasury or otherwise under the law, Pre-Tax Contributions,
made for the benefit of such individual for the current Plan Year (if any) to
the total compensation for the immediately preceding Plan Year paid to such
individual.

 

22

 

(7)  The term “compensation” shall have the
meaning set forth in section 414(s) of the Code or, in the discretion of
the Administrator, any other meaning in accordance with the Code for these
purposes.

 

(8)  If the Plan and one or more other plans of
an Employer to which Pre-Tax Contributions, Matching Contributions or employee
contributions (as such terms are defined for purposes of section 401(m) of
the Code) are made are treated as one plan for purposes of section 410(b) of
the Code, such plans shall be treated as one plan for purposes of this
Section.  If a Highly Compensated
Employee participates in the Plan and one or more other plans of an Employer to
which any such contributions are made, all such contributions shall be
aggregated for purposes of this Section.

 

(d)   Safe Harbor
Election.  Notwithstanding anything
in this Section 6.2 to the contrary, if the Company elects the Matching
Contribution safe harbors set forth in section 401(k)(12) and 401(m)(11)
of the Code for any Plan Year by providing to each Participant and Rexall
Participant a comprehensive notice of such participant’s rights and obligations
under the Plan, written in a manner calculated to be understood by an average
participant, at least 30 days, but not more than 90 days, before the beginning
of such Plan Year (or, in the case of an Associate who becomes a participant
during the Plan Year, by the day on which such Associate becomes a participant,
but not more than 90 days prior) and allows participants to make or modify
their elections to make Pre-Tax Contributions as described in Section 4.1
or 4.3(a) during the 30-day period immediately following receipt of such
notice, then the Plan shall be deemed to have satisfied the actual deferral
percentage test of Section 6.2(a) and the actual contribution
percentage test of Section 6.2(b) for the Plan Year.

 

(e)   Adjustments to
Comply with Limits.

 

(1)  Adjustments to Comply with Actual
Deferral Percentage Test.  The
Administrator shall cause to be made such periodic computations as it shall
deem necessary or appropriate to determine whether the actual deferral
percentage test will be satisfied during a Plan Year, and, if it appears to the
Administrator that such test will not be satisfied, the Administrator shall
take such steps as it deems necessary or appropriate to adjust the Pre-Tax
Contributions made pursuant to Section 4.1 and 4.3(a) for all or a
portion of the remainder of such Plan Year for the benefit of some or all of
the Highly Compensated Employees to the extent necessary in order for the
actual deferral percentage test to be satisfied.  If, after the end of the Plan Year, the
Administrator 

 

23

 

determines
that, notwithstanding any adjustments made pursuant to the preceding sentence,
the actual deferral percentage test was not satisfied, the Administrator shall
calculate a total amount by which Pre-Tax Contributions must be reduced in
order to satisfy such test in the manner prescribed by section 401(k)(8)(B) of
the Code (the “excess contributions amount”). 
The amount of Pre-Tax Contributions to be reduced for each Participant
and Rexall Participant who is a Highly Compensated Employee shall be determined
by first reducing the Pre-Tax Contributions of each such participant whose
actual dollar amount of Pre-Tax Contributions for such Plan Year is highest
until such reduced dollar amount equals the next highest actual dollar amount
of Pre-Tax Contributions made for such Plan Year on behalf of any Highly
Compensated Employee or until the total reduction equals the excess
contributions amount.  If further
reductions are necessary, then the Pre-Tax Contributions on behalf of each
participant who is a Highly Compensated Employee and whose actual dollar amount
of Pre-Tax Contributions for such Plan Year is the highest (determined after
the reduction described in the preceding sentence) shall be reduced in
accordance with the preceding sentence. 
Such reductions shall continue to be made to the extent necessary so
that the total reduction equals the excess contributions amount.  The portion of a participant’s Pre-Tax
Contributions to be reduced in accordance with this Section 6.2(e)(1) shall
be distributed to such participant and recharacterized as a corrective
distribution of excess contributions, and the participant shall be notified of
such recharacterization and the tax consequences thereof no later than 21⁄2
months after the end of the Plan Year (or if notification by such date is
administratively impracticable, no later than the last day of the subsequent
Plan Year).  The amount of a participant’s
Pre-Tax Contributions to be reduced in accordance with this Section shall be
reduced by any excess deferrals previously distributed to such participant
pursuant to Section 6.1 in order to comply with the limitations of section 402(g) of
the Code.  The amount of any income or
loss allocable to any such reductions shall be determined pursuant to the
applicable regulations promulgated by the U.S. Treasury Department.

 

(2)  Adjustments to Comply with Actual
Contribution Percentage Test.  The
Administrator shall cause to be made such periodic computations as it shall
deem necessary or appropriate to determine whether the average contribution
percentage test will be satisfied during a Plan Year, and, if it appears to the
Administrator that such test will not be satisfied, the Administrator shall
take such steps as it deems necessary or appropriate to adjust the Matching
Contributions made pursuant to Section 4.2 and 4.3(b) for all or a
portion of the remainder of such Plan Year on behalf of some or all of the
Highly Compensated Employees to the extent necessary in order for the average contribution
percentage test to be satisfied.  If,
after the end of the Plan Year, the Administrator determines that,
notwithstanding any adjustments made pursuant to the preceding sentence, the
average contribution percentage test was not satisfied, the Administrator
shall, in its discretion, (1) allocate a qualified nonelective
contribution pursuant to Section 6.2(f) or (2) reduce the
Matching Contributions made on behalf of each Participant and Rexall
Participant who is a Highly Compensated Employee and whose actual dollar amount
of Matching Contributions for such Plan Year is the highest in the same manner
described in subparagraph (1) of this paragraph to the extent necessary to
comply with the average contribution percentage test.  The reduction described in the preceding
sentence shall be made with respect to Matching 

 

24

 

Contributions.  With respect to contributions to be so
reduced, no later than 21⁄2 months after the end of the Plan Year (or if correction
by such date is administratively impracticable, no later than the last day of
the subsequent Plan Year), the Administrator shall cause to be distributed to
each such participant the amount of such reductions made with respect to vested
Matching Contributions to which such participant would be entitled under the
Plan if such participant had terminated service on the last day of the Plan
Year for which such contributions are made (or on the date of the participant’s
actual termination of employment, if earlier), and any remaining amount of such
reductions (plus any income and minus any loss allocable thereto) shall be
forfeited.  Any amounts forfeited
pursuant to this paragraph shall be treated in the same manner as forfeitures
described in Section 9.2.  The
amount of any such income or loss allocable to any such reduction to be so
distributed or forfeited shall be determined pursuant to applicable regulations
promulgated by the U.S. Treasury Department.

 

(f)    Qualified
Nonelective Contributions.  Subject
to the limitations set forth in Sections 6.3 and 6.4, and to the extent
permitted by U.S. Treasury regulations or other pronouncements of the Internal
Revenue Service, for purposes of satisfying the actual contribution percentage
test set forth in Section 6.2(b), the Employers may contribute for a Plan
Year such amount, if any, as may be designated as a “qualified nonelective
contribution” within the meaning of section 401(m)(4)(C) of the
Code.  Any qualified nonelective
contribution to the Plan shall be allocated to the Accounts of those
Participants and Rexall Participants who are not Highly Compensated Employees
for the Plan Year with respect to which such qualified nonelective contribution
is made and who are actively employed by the contributing Employer on the date
such contribution is made, beginning with the participant with the lowest
Compensation for such Plan Year and allocating the maximum amount permissible
under Section 6.3 before allocating any portion of such qualified
nonelective contribution to the participant with the next lowest Compensation
for the Plan Year.  Such allocation shall
continue until the Plan satisfies the requirements in Section 6.2(b) or
until the amount of such qualified nonelective contribution has been completely
allocated.  Any such qualified
nonelective contributions and earnings and losses thereon shall be accounted
for separately by the Trustee and shall be distributable in accordance with the
provisions of Article 9. 
Notwithstanding any 

 

25

 

provision of the
Plan to the contrary, the portion of a participant’s account derived from
qualified nonelective contributions at all times shall be nonforfeitable.

 

Section 6.3.            Maximum
Annual Additions under Section 415 of the Code.  Notwithstanding any other provision of the
Plan, and except to the extent permitted under Sections 4.1(b) of the Plan
and section 414(v) of the Code, the amounts allocated to the Account
and ESOP Account of each Participant, Rexall Participant and ESOP Participant
for any Plan Year shall be limited so that the aggregate annual additions for
such year to such a participant’s Account and his or her ESOP Account and to
the participant’s accounts in all other defined contribution plans maintained
by any Employer or Affiliate shall not exceed the lesser of:

 

(a) 
$42,000 (as adjusted pursuant to section 415(d) of the Code), and

 

(b) 
100% of his or her compensation for such Plan Year (or such other percentage of
compensation set forth in section 415(c) of the Code).

 

If the
annual additions to a participant’s Account and his or her ESOP Account exceed
the limitations set forth above for any Plan Year (i) as a result of a
reasonable error in estimating his or her annual compensation, (ii) as a
result of a reasonable error in determining the amount of Pre-Tax Contributions
that may be made by a participant under section 415 of the Code or (iii) under
other facts and circumstances as determined by the Commissioner of Internal
Revenue, the amounts to be allocated to such participant’s Account and his or
her ESOP Account for such year shall be reduced to the extent of the excess
first with respect to any Pre-Tax Contributions as to which no Matching
Contribution was made and then to remaining Pre-Tax Contributions and any
Matching Contributions attributable thereto and finally with respect to
contributions to the ESOP Account on a pro rata basis.  Any Pre-Tax Contributions so reduced, 

 

26

 

plus earnings thereon,
shall be distributed to the participant. 
Any Matching Contributions so reduced, plus earnings thereon, shall be
held in a segregated suspense account and shall be treated in the next Plan
Year as Matching Contributions thereby reducing amounts actually contributed by
the Employers for such year.  Upon
termination of the Plan, any balance in such suspense account shall be returned
to each Employer in the amount determined by the Administrator, but only if the
allocation upon Plan termination of such amount to participants would cause all
participants to receive annual additions in excess of the limitations of section 415
of the Code.

 

The “annual
additions” for a Plan Year to a participant’s Account and his or her ESOP
Account and to his or her accounts in any other defined contribution plan of an
Employer or Affiliate is the sum for such Plan Year of:

 

(a)   the amount of
employer contributions (including Pre-Tax Contributions) allocated to his or
her accounts, excluding, however, any Pre-Tax Contributions that are Catch-up
Contributions or that are made under section 414(v) of the Code,

 

(b)   the amount of
forfeitures allocated to his or her accounts,

 

(c)   the amount
allocated to any individual medical benefit account (as defined in section 415(l)
of the Code) maintained on his or her behalf, and

 

(d)   the amount of any
of his or her contributions, excluding any Rollover Contributions, to any such
plan.

 

For
purposes of this Section, the term “compensation” shall have the meaning set
forth in U.S. Treasury Regulation § 1.415-2(d)(10) except that in the
case of an Associate whose employment is transferred from an Employer to an
Affiliate that is not an Employer, such term 

 

27

 

shall exclude any
compensation received by such Associate from such Affiliate, and the term “defined
contribution plan” shall have the meaning set forth in section 415(k)(1) of
the Code.

 

Section 6.4.         Other
Limitations on Employer Contributions. 
The contributions of the Employers for a Plan Year shall not exceed the
maximum amount for which a deduction is allowable to such Employers for federal
income tax purposes for the fiscal year of such Employers that ends with such
Plan Year.

 

Any
contribution made by an Employer by reason of a good faith mistake of fact, or
the portion of any contribution made by an Employer that exceeds the maximum
amount for which a deduction is allowable to such Employer for federal income
tax purposes by reason of a good faith mistake in determining the maximum
allowable deduction, shall upon the request of such Employer be returned by the
Trustee to an Employer.  An Employer’s
request and the return of any such contribution must be made within one year
after such contribution was mistakenly made or after the deduction of such excess
portion of such contribution was disallowed, as the case may be.  The amount to be returned to an Employer
pursuant to this paragraph shall be the excess of (i) the amount
contributed over (ii) the amount that would have been contributed had
there not been a mistake of fact or a mistake in determining the maximum
allowable deduction.  Earnings
attributable to the mistaken contribution shall not be returned to an Employer,
but losses attributable thereto shall reduce the amount to be so returned.  If the return to an Employer of the amount
attributable to the mistaken contribution would cause the balance of any
participant’s Account as of the date such amount is to be returned (determined
as if such date coincided with the close of a Plan Year) to be reduced to less
than what would have been the balance of such Account as of such date had the
mistaken amount not been contributed, the amount to be returned to an Employer
shall be limited so as to avoid such reduction.

 

28

 

ARTICLE 7

 

TRUST AND INVESTMENT FUNDS

 

Section 7.1.            Trust.  A Trust shall be established by the execution
of a trust agreement between the Company (acting on behalf of the Employers)
and the Trustee.  All contributions under
the Plan shall be paid to the Trustee. 
The Trustee shall hold all monies and other property received by it and
invest and reinvest the same, together with the income therefrom, on behalf of
the Participants, Rexall Participants and ESOP Participants collectively in
accordance with the provisions of the trust agreement; to the extent
applicable, the investment elections of the participants; and with respect to
ESOP Contributions, primarily in qualifying employer securities.  The Trustee shall make distributions from the
Trust Fund at such time or times to such person or persons and in such amounts
as the Administrator or the Recordkeeper directs in accordance with the Plan.

 

Section 7.2.            Designation
of Investment Funds.  The Company
shall cause the Trustee to establish, operate and maintain three or more
separate investment funds exclusively for the collective investment and
reinvestment of moneys directed by the Participants and Rexall Participants to
be invested in such funds on their behalf. 
Additional investment funds may be established as determined by the
Company from time to time in its sole discretion.  The Administrator and the Recordkeeper will
establish procedures setting forth how often changes between investments may be
made and any other limitations and provisions that they may impose on a
participant’s right to direct investments.

 

Section 7.3.            Trust
Fund to Be Applied Exclusively for Participants and their Beneficiaries, Etc.  Subject only to the provisions of Article 6
and Sections 15.1 and 15.2(b) and (c), and any other provision of the Plan
to the contrary notwithstanding, no part of the Trust 

 

29

 

Fund shall be used
for or diverted to any purpose other than for the exclusive benefit of the
Participants, Rexall Participants, ESOP Participants and their Beneficiaries.

 

ARTICLE 8

 

PARTICIPANT ACCOUNTS,

INVESTMENT ELECTIONS, ETC.

 

Section 8.1.         Participant
Accounts.  The Administrator shall
establish and maintain, or cause to be established and maintained, a separate
Account for each Participant and Rexall Participant.  Each Account shall consist of the following
subaccounts:

 

(i)            if
Pre-Tax Contributions have been made for the benefit of a participant pursuant
to Section 4.1 or 4.3(a) or under the Prior Plan, a Pre-Tax Account
to which shall be credited such Pre-Tax Contributions and earnings and losses
thereon;

 

(ii)           if
Matching Contributions have been made for the benefit of a participant pursuant
to Section 4.2 or 4.3(b) or under the Prior Plan, a Matching Account
to which shall be credited such Matching Contributions and earnings and losses
thereon;

 

(iii)          if
Profit Sharing Contributions have been made for the benefit of a Rexall
Participant pursuant to a Prior Plan, a Profit Sharing Account to which shall
be credited such Profit Sharing Contributions and earnings and losses thereon;

 

(iv)          if
a Special Bonus Contribution has been made for the benefit of a Participant
pursuant to Section 4.3(c), a Special Bonus Account to which shall be
credited such Special Bonus Contribution and earnings and losses thereon;

 

(v)           if
contributions have been made for the benefit of a participant when the Plan was
a top-heavy plan within the meaning of Section 16.1, a Top-Heavy Plan
Account to which shall be credited such contributions and earnings and losses
thereon; and

 

(vi)          if
a Rollover Contribution has been made by a participant, a Rollover Account to
which shall be credited such Rollover Contribution and earnings and losses
thereon.

 

Unless
the context otherwise requires, a participant’s “Account” or “Account balance”
shall mean the aggregate value of all separate accounts, excluding ESOP
Accounts, and subaccounts maintained on his or her behalf pursuant to the Plan
and Trust agreement.  The books of
account, forms and accounting methods used in the administration of
participants’ 

 

30

 

Accounts shall be the
responsibility of, and shall be subject to the supervision and control of, the
Company.

 

Section 8.2.            ESOP
Account.  An ESOP Participant’s ESOP
Account shall be comprised of NBTY Stock and other assets attributable to ESOP
Contributions or forfeited by other ESOP Participants.

 

(a)   Assets other
than NBTY Stock.  The Trustee shall
determine the market value of the non-NBTY Stock assets of an ESOP Participant’s
ESOP Account as of each ESOP Allocation Date, adjusting such value to reflect
income, realized and unrealized profits, and losses and expenses attributable
to such accounts.  The adjustments so
made shall be allocated to each ESOP Account based upon its balance as of the
beginning of the relevant Plan Year in relationship to the aggregate balances
of all ESOP Accounts as of the beginning of such Plan Year.

 

(b)   NBTY Stock.  Each ESOP Participant’s ESOP Account shall be
credited as of each ESOP Allocation Date with a number of shares of NBTY Stock
determined solely by the Company.  As
soon as practicable after such crediting to the ESOP Accounts occurs, each ESOP
Participant shall be notified of the new balance of his or her ESOP Account.

 

Section 8.3.            Investment
Elections.  (a)    Initial Election.  Each Participant and Rexall Participant may
make, in the manner prescribed by the Administrator or Recordkeeper, an
investment election that shall apply to the investment of contributions made
for such participant’s benefit and any earnings on such contributions, other
than contributions made pursuant to Section 5.1 and any earnings thereon,
subject to such limitations set forth herein or imposed by the Administrator or
Recordkeeper from time to time.  Such
election shall specify that such contributions be invested either (i) wholly
in one of the investment funds maintained 

 

31

 

by the Trustee
pursuant to Section 7.2, or (ii) divided among two or more of such
investment funds in increments of 1% (or such larger percentage established by
the Administrator or Recordkeeper from time to time).  During any period in which no direction as to
the investment of a participant’s Account is on file with the Recordkeeper,
contributions made for a participant’s benefit shall be invested in a fund
selected by the Administrator from time to time.

 

(b)   Change of
Election.  A Participant or Rexall
Participant may change his or her investment election as of any Valuation Date,
subject to such limitations as the Administrator or Recordkeeper from time to
time may impose (including restrictions on investment election changes that
apply solely to a particular investment fund). 
A participant’s investment election change shall be limited to the
investment funds then maintained by the Trustee pursuant to Section 7.2.  A change in investment election made pursuant
to this Section shall apply to a participant’s existing Account or
contributions allocated to such Account after such change, or both.  Any such change shall specify that such
Account or contributions be invested either (i) wholly in one of the funds
maintained by the Trustee pursuant to Section 7.2 or (ii) divided
among two or more of such funds in increments of 1% (or such larger percentage
established by the Administrator from time to time) or, solely with respect to
a participant’s existing Account, in fixed dollar amounts.  A participant’s change of investment election
must be made in the manner prescribed by the Administrator or
Recordkeeper.  The Administrator or
Recordkeeper shall prescribe rules regarding the time by which such an
election must be made in order to be effective for a particular Valuation Date.

 

(c)   Facilitation.  Notwithstanding any election of any
Participant or Rexall Participant, the Trustee shall have the right to hold
invested in a short-term investment fund any 

 

32

 

amounts intended for investment or reinvestment until such time as
investment or reinvestment may be made in accordance with the Plan and Trust.

 

(d)   ESOP
Diversification.

 

(i)            For
Plan Years ending on or before December 31, 2002, and for diversification
elections effectuated prior to January 1, 2004, each ESOP Participant who
has attained age fifty-five (55) and completed ten (10) years of
participation as an ESOP Participant shall have the right to make an election
to direct the Trustee as to investment of his or her ESOP Account.  In each of the first five (5) Plan Years
following the Plan Year in which an ESOP Participant attained age fifty-five
(55) and completed ten (10) years of participation as an ESOP Participant,
such an ESOP Participant may elect within ninety (90) days after the close of
each such Plan Year in the qualified election period (as defined in section 401(a)(28)
of the Code) to diversify twenty-five percent (25%) of his or her ESOP Account
less any amount to which a prior election applies.  In the sixth (6th) year, such an
ESOP Participant may elect within ninety (90) days after the close of each Plan
Year in the qualified election period (as defined in section 401(a)(28) of
the Code) to diversify fifty percent (25%) of his or her ESOP Account less any
amount to which a prior election applies.

 

(ii)           For
Plan years beginning on or after January 1, 2003, and for diversification
elections effectuated on or after January 1, 2004, any ESOP Participant
who has attained age fifty-five (55) and has completed ten (10) years of
participation as an ESOP Participant shall have the right to make an election
to direct the Trustee as to the investment of his or her ESOP Account as
follows.  In each of the first five (5) Plan
Years following the Plan Year in which an ESOP Participant attained age
fifty-five (55) and completed ten (10) years of participation as an ESOP
Participant, such an ESOP Participant may elect within ninety (90) days after
the close of each Plan Year in the qualified election period (as defined in section 401(a)(28)
of the Code) to diversify twenty-five percent (25%) of his or her ESOP Account
less any amount to which a prior election applies.  In the sixth (6th) year, such an
ESOP Participant may elect within ninety (90) days after the close of each Plan
Year in the qualified election period (as defined in section 401(a)(28) of
the Code) to diversify fifty percent (50%) of his or her ESOP Account less any
amount to which a prior election applies.

 

(iii)          For
Plan Years beginning on or after January 1, 2005 and for diversification
elections effectuated on or after January 1, 2005, any ESOP Participant
who has attained age fifty-five (55) and completed ten (10) years of
participation as an ESOP Participant (a “Qualified ESOP Participant”) shall
have the right to make an election to direct the Plan as to investment of his
or her ESOP Account as follows.  In each
of the first five (5) Plan Years following the Plan Year in which an ESOP
Participant  became a Qualified ESOP
Participant, such Qualified ESOP Participant may elect to direct the investment
of twenty-five percent (25%) of the value of his or her ESOP Account (any
amount transferred to his or her Account pursuant to Section 8.3(d)(iv) shall
be taken into account in determining whether the ESOP Participant has directed
the investment of twenty-five percent (25%) of the value of his or her ESOP 

 

33

 

Account) within
ninety (90) days after the last day of each Plan Year during a Qualified ESOP
Participant’s qualified election period (as defined in section 401(a)(28)
of the Code).  Within 90 days after the
close of the last Plan Year in a Qualified ESOP Participant’s qualified
election period, he or she may direct the investment in fifty percent (50%) of
the value of his or her ESOP Account (any amount transferred to his or her
Account pursuant to Section 8.3(d)(iv) shall be taken into account in
determining whether the ESOP Participant has directed the investment of fifty
percent (50%) of the value of his or her ESOP Account).  A Qualified ESOP Participant’s direction
shall be provided to the Recordkeeper in a manner determined by the
Recordkeeper and shall become effective within 180 days after the close of the
Plan Year to which the direction applies.

 

(iv)          Any
election under Section 8.3(d) shall result in a transfer of the
applicable portion of the ESOP Participant’s ESOP Account to subaccounts of the
ESOP Participant’s Account established under Section 8.1.

 

Section 8.4.            Valuation
of Funds and Plan Accounts.  The
value of an investment fund as of any Valuation Date shall be the market value
of all assets (including any uninvested cash) held by the fund on such
Valuation Date as determined by the Trustee, reduced by the amount of any
accrued liabilities of the fund on such Valuation Date.  The Trustee’s determination of market value
shall be binding and conclusive upon all parties.  The value of a participant’s Account as of
any Valuation Date shall be the sum of the values of his or her investment
subaccounts in each of the accounts listed in Section 8.1.

 

Section 8.5.            Allocation
of Contributions.  Any Pre-Tax
Contribution, Matching Contribution, Special Bonus Contribution, Rollover
Contribution or any contribution made when the Plan is a top-heavy plan within
the meaning of Section 16.1 shall be allocated to the Pre-Tax Account,
Matching Account, Special Bonus Account, Rollover Account or Top-Heavy Account,
as applicable, of the participant for whom such contribution is made as soon as
practicable after the Valuation Date coinciding with or next following the date
on which such contribution is delivered to the Trustee and shall be credited to
such participant’s Account as of such Valuation Date.

 

34

 

Section 8.6.            ESOP
Allocations.

 

(a)   Allocation of
Employer Contributions and Forfeitures. 
As of each ESOP Allocation Date, the total number of shares and
fractional shares of NBTY Stock contributed to the Trust Fund, purchased by the
Trustee with cash contributions made by the Company on behalf of the Employers,
or released from the ESOP Suspense Account during the Plan Year shall be
computed and allocated along with any applicable forfeitures.  The allocation of NBTY Stock shall be made
according to Section 5.1.

 

(b)   Allocation of
Cash Dividends.  Cash dividends on NBTY
Stock allocated to an ESOP Participant’s ESOP Account shall be paid to such
ESOP Participant’s ESOP Account and reinvested in NBTY Stock.  Cash dividends on unallocated shares of NBTY
Stock shall be allocated in accordance with the provisions of Section 8.6(c).

 

(c)   Allocation of
Earnings and Losses.  As of each ESOP
Allocation Date, the Trustee shall determine the fair market value of the
assets relating to ESOP Accounts.  The
Trustee shall allocate to the accounts of the ESOP Participants the net earnings
and gains or losses related to ESOP Accounts since the immediately preceding
ESOP Allocation Date.  Dividends shall be
allocated based on relative beginning ESOP Account balances less any
distributions actually paid.  Interest
and other earnings shall be allocated based upon the ratio of each ESOP
Participant’s ESOP Account balance as of the time immediately preceding the
ESOP Allocation Date less distributions actually paid to the aggregate balance
of all ESOP Participant’s ESOP Accounts. 
Other adjustments may be made to ESOP Accounts as may be necessary and
appropriate in order to achieve an equitable allocation of the net earnings and
gains or losses as long as such allocation is performed in a uniform and
non-discriminatory manner.

 

35

 

(d)   Allocation of
NBTY Stock.  Any provision hereof to
the contrary  notwithstanding, at any
time NBTY Stock and assets other than NBTY Stock are to be allocated to the
ESOP Accounts of ESOP Participants and former ESOP Participants, then, to the
greatest extent possible without resulting in discrimination in favor of Highly
Compensated Employees, NBTY Stock shall be allocated to the accounts of ESOP
Participants and assets other than NBTY Stock shall be allocated to the
Accounts of former ESOP Participants.

 

(e)   Interim
Allocations.  NBTY Stock acquired by
the Trustee with the proceeds of a loan shall be credited to the ESOP Suspense
Account.  As of each ESOP Allocation
Date, the balance in the ESOP Suspense Account shall be allocated to the ESOP
Accounts in the manner described in Section 8.6(a).

 

Section 8.7.         Voting
and Exercising Other Securities Rights With Respect to NBTY Stock.

 

(a)   Each ESOP
Participant and each former ESOP Participant who has an ESOP Account shall be
entitled to direct the Trustee as to the manner in which NBTY Stock credited to
such ESOP Account is to be voted and as to the manner in which other
shareholder rights with respect to such NBTY Stock are to be exercised.  The following guidelines shall apply with
regard to the voting rights of ESOP Participants and former ESOP Participants
with respect to the NBTY Stock credit to their ESOP Accounts:

 

(i)            The
Trustee shall notify ESOP Participants and former ESOP Participants of each
occasion for the exercise of voting rights within a reasonable period (not less
than thirty (30) days, unless such period is impossible or impractical) before
such rights are to be exercised.

 

(ii)           The
Trustee shall take whatever steps are reasonably necessary to allow each ESOP
Participant to exercise rights other than voting rights of NBTY Stock
represented by the ESOP Participant’s or former ESOP Participant’s ESOP
Account.

 

(iii)          The
number of shares to which each ESOP Participant and former ESOP Participant is
entitled to vote shall have the right to direct the exercise of the rights 

 

36

 

thereof shall be
determined for any record date by the number of shares allocated to his or
her  ESOP Account on the last ESOP
Allocation Date.

 

(iv)          The
Trustee shall vote fractional shares by combining directions on voting of such
fractional shares to the extent possible.

 

(v)           The
Trustee shall vote any shares in the ESOP Suspense Account in the same
proportion and in the same manner as the shares in ESOP Participants’ and
former ESOP Participant’s ESOP Accounts are voted by the ESOP Participants.

 

(b)   The Trustee shall
make no recommendation regarding the manner of exercising any rights under this
Section 8.7, including whether such rights should be exercised

 

Section 8.8.         Allocation
of Forfeitures.

 

(a)   In General.  The total amount forfeited during any Plan
Year pursuant to Sections 9.2(b) and 9.9 from the Accounts of participants
employed by an Employer, reduced by the amount of such forfeitures credited to
the accounts of former participants who have been reemployed pursuant to Section 12.2
or 12.4 shall be applied first to reduce expenses related to the administration
of the Plan and then to reduce any Employer contributions.

 

(b)   ESOP
Forfeitures.  With respect to any
ESOP Participant who terminates employment and who is not vested in his or her
ESOP Account pursuant to Section 9.4(c), a distribution shall be deemed to
have occurred as of such termination of employment.  The resulting ESOP Participants’ forfeitures
that are pending as of December 31, 2005 shall be allocated to the ESOP
Accounts of the ESOP Participants employed by an Employer on such date.  After December 31, 2005, the forfeitures
of ESOP Participants who terminate employment during a calendar year shall be
allocated to the ESOP Accounts of the ESOP Participants employed by an Employer
on the last day of such year. 
Forfeitures shall be added to the contribution made pursuant to Article 5
for purposes of allocation to ESOP Accounts.

 

Section 8.9.            Correction
of Error.  If it comes to the
attention of the Administrator that an error has been made in any of the
allocations prescribed by this Article 8, 

 

37

 

appropriate
adjustment shall be made to the accounts of all Participants, Rexall
Participants, ESOP Participants and Beneficiaries that are affected by such
error, except that no adjustment need be made with respect to any participant
or Beneficiary whose account has been distributed in full prior to the discovery
of such error.

 

Section 8.10.          ERISA
Section 404(c) Plan.  The
Plan, other than provisions of the Plan addressing the employees’ stock
ownership plan portion of the Plan, is intended to meet the requirements of section 404(c) of
ERISA and the U.S. Department of Labor regulations promulgated thereunder, and
the applicable provisions of the Plan shall be construed and interpreted to
meet such requirements.

 

Section 8.11.          Transfers
from Other Plans.  With the consent
of the Administrator, amounts may be transferred (within the meaning of section 414(l)
of the Code) to the Trustee of the Plan from another tax-qualified plan under section 401(a) of
the Code (the “Other Plan”), provided that the Other Plan from which such funds
are transferred permits the transfer to be made and the transfer will not
jeopardize the tax-exempt status of the Plan or create adverse tax consequences
for an Employer.  The amounts transferred
from the Other Plan shall be credited to administrative subaccounts to be held,
invested, reinvested and distributed pursuant to the terms of the Plan and the
Trust, and, as of the date of the transfer of any such participant’s interest
in the Other Plan,

 

(1)  there shall be credited to the Pre-tax
Account of such participant that portion of his or her interest in the Other
Plan which is transferred to the Trustee and which represents the participant’s
Pre-Tax Contributions, if any, made to the Other Plan on behalf of the
participant,

 

(2)  there shall be credited to the Matching
Account of such participant that portion of his or her interest in the Other
Plan which is transferred to the Trustee and which represents the Matching
Contributions, if any, made to the Other Plan on behalf of the participant,

 

38

 

(3)  there shall be credited to the Rollover
Account of such Participant that portion of his or her interest in the Other
Plan which is transferred to the Trustee and which represents the participant’s
rollover contributions, if any, to the Other Plan, and

 

(4)  there shall be credited to a special
subaccount(s) of such participant that portion of his or her interest in the
Other Plan which is transferred to the Trustee and which represents any other
type of contribution to the Other Plan.

 

Any
amounts credited to a participant’s Pre-Tax Account, Matching Account, Rollover
Account or other subaccount shall be credited to the administrative subaccounts
in accordance with such participant’s investment direction in effect as of the
date of such transfer.

 

ARTICLE 9

 

WITHDRAWALS AND DISTRIBUTIONS

 

Section 9.1.         Withdrawals
From Account Prior to Termination of Employment.  (a)   
Hardship Withdrawals. 
Subject to the provisions of this subsection, a Participant or Rexall
Participant who has taken all loans available to him or her under Article 10,
and all withdrawals available under Section 9.1(b) and (c) and
has incurred a financial hardship may withdraw as of any Valuation Date all or
any portion of the combined balance of (i) such participant’s Pre-Tax
Account; (ii) pre-1989 earnings on such participant’s Pre-Tax Account; (iii) the
vested portion of such participant’s Matching Account; (iv) the vested
portion of such participant’s Special Bonus Account; and (v) in the case
of a Rexall Participant, such participant’s Profit Sharing Account.  The amount of such withdrawal shall not exceed
the amount needed to satisfy the financial hardship, including amounts
necessary to pay any federal, state or local taxes or any penalties reasonably
anticipated to result from the hardship withdrawal.  The determination of the existence of a
financial hardship and the amount required to be distributed to satisfy such
hardship shall be made by the Administrator in a uniform and non-discriminatory
manner according to the following rules:

 

39

 

(1)  A financial hardship shall be deemed to
exist if and only if the participant certifies that the financial need is on
account of:

 

(A)  expenses for medical care described in section 213(d) of
the Code previously incurred by the participant, the participant’s spouse, or
any dependents (as defined in section 152 of the Code) of the participant
or necessary for such persons to obtain medical care described in section 213(d) of
the Code;

 

(B)  costs directly related to the purchase of a
principal residence for the participant (excluding mortgage payments);

 

(C)  payment of tuition, room and board and
related educational fees for the next 12 months of post-secondary education for
the participant, the participant’s spouse or any dependents (as defined in section 152
of the Code) of the participant;

 

(D)  payments necessary to prevent the eviction
of the participant from the participant’s principal residence or foreclosure of
the mortgage on that residence; or

 

(E)  the occurrence of any other event determined
by the Commissioner of Internal Revenue pursuant to Treasury Regulation § 1.401(k)-1(d)(2)(iv).

 

(2)  A distribution shall be treated as necessary
to satisfy a financial need if and only if the participant certifies (and if
the Administrator has no reason to believe that such certification is
inaccurate) that such hardship cannot be relieved by or through:

 

(A)  reimbursement or compensation by insurance
or otherwise;

 

(B)  cessation of Pre-Tax Contributions under the
Plan;

 

(C)  reasonable liquidation of the participant’s
assets (including assets of the participant’s spouse and minor children that
are reasonably available to the participant), to the extent such liquidation
would not itself cause an immediate and heavy financial need; or

 

(D)  other distributions or nontaxable (at the
time of the loan) loans from this Plan or other plans maintained by an Employer
or by another employer, or by borrowing from commercial sources on reasonable commercial
terms.

 

(3)  The participant shall be required to submit
any additional supporting documentation as may be requested by the
Administrator or Recordkeeper.

 

(4)  Any hardship withdrawal pursuant to this Section 9.1(a) shall
be in the form of a lump sum payment.

 

(5)  A participant may receive a hardship
withdrawal pursuant to this Section 9.1(a) no more than once during
any six-month period.

 

40

 

(6)  Amounts distributed to a participant
pursuant to this Section 9.1(a) shall be withdrawn first from the
participant’s Pre-Tax Account, next from the vested portion of the participant’s
Matching Account, next from the vested portion of the participant’s Special
Bonus Account and then from the participant’s Profit Sharing Account, if any,
and shall not be taken from the next source until the previous source has been
depleted.

 

(7)  Notwithstanding any provision of the Plan to
the contrary, a participant who receives a hardship withdrawal hereunder shall
be prohibited from making any Pre-Tax Contributions under Section 4.1 and
4.3(a) and under all other plans of the Employers and Affiliates until the
first payroll period commencing coincident with or next following the date
which is six months after the date the hardship withdrawal was made (or such
earlier date as may be permitted by applicable regulations promulgated by the
U.S. Treasury Department).  Such a
participant may elect to resume making Pre-Tax Contributions in accordance with
the procedures set forth in Section 4.1. 
For purposes of this paragraph, “all other plans of the Employers and
Affiliates” shall include stock option plans, stock purchase plans, qualified
and nonqualified deferred compensation plans, other than plans subject to section 409A
of the Code (unless contributions to such plans are permitted to cease under
U.S. Treasury regulations promulgated thereunder), and such other plans as may
be designated under regulations promulgated by the U.S. Treasury Department,
but shall not include health and welfare plans and the mandatory employee
contribution portion of a defined benefit plan.

 

(b)   Withdrawals
From Account On or After Age 591⁄2.  As
of any Valuation Date, a Participant or Rexall Participant who has attained age
591⁄2 may withdraw all or any portion of his or her Pre-Tax Account, and, in
addition, for a Rexall
Participant, all or any portion of his or her vested Matching Account and
Profit Sharing Account.  A withdrawal
made pursuant to this Section 9.1(b) shall be made at the participant’s
election in any form of payment provided under Section 9.3(c).

 

(c)   Withdrawals
from Rollover Account.  As of any
Valuation Date, a Participant or Rexall Participant may withdraw all or any
portion of his or her Rollover Account. 
Any withdrawal pursuant to this Section 9.1(c) shall be in the
form of a lump sum payment.

 

(d)   Conditions
Applicable to All Withdrawals.  A
Participant’s or Rexall Participant’s request for a withdrawal pursuant to this
Section 9.1 shall be made at such time and in such manner as may be
prescribed by the Administrator or Recordkeeper.  The amount available for withdrawal pursuant
to this Section 9.1 shall be reduced by the amount of any loan 

 

41

 

made pursuant to Article 10
that is outstanding at the time of withdrawal. 
The amount available for withdrawal under this Section 9.1 is
subject to reduction in the sole discretion of the Administrator to take into
account the investment experience of the Trust Fund between the date of the
withdrawal election and the date of the withdrawal.

 

Section 9.2.            Distribution
of Account Upon Termination of Employment. 
(a)    Termination of
Employment under Circumstances Entitling Participant to Full Distribution of
Account.  If a Participant’s or
Rexall Participant’s employment with all Employers and Affiliates terminates
under any of the following circumstances, then the participant or his or her
designated Beneficiary, as the case may be, shall be entitled to receive the
participant’s entire Account:

 

(1)  the participant’s death;

 

(2)  the participant’s Disability;

 

(3)  on or after the date the participant attains
age 65; or

 

(4)  in the case of a Participant, on or after
the date the Participant has completed at least three Years of Service; provided,
however, that in the case of a
Participant employed by Solgar Inc. before January 1, 2006 who terminates
employment on or before December 31, 2005, the word “three” shall be
replaced with the word “five”; and

 

(5)  in the case of a Rexall Participant, on or
after the date the Rexall Participant has completed at least three Years of
Service.

 

(b)   Termination of
Employment under Circumstances Resulting in Partial Forfeiture of the
Participant’s Account.  If a
Participant’s or Rexall Participant’s employment with all Employers and
Affiliates terminates under circumstances other than those set forth in Section 9.2(a),
then the participant shall be entitled to receive the entire balance of the
participant’s Pre-Tax Account and Rollover Account and:

 

(1)  In the case of a Participant who has
completed less than three Years of Service as of the date of his or her
termination of employment, such Participant shall forfeit the entire balances
of his or her Matching Account and Special Bonus Account, if 

 

42

 

any.  Notwithstanding anything to the contrary
contained herein, the following provisions shall apply on and before December 31,
2005 with respect to each Participant who is employed by Solgar, Inc.:  (i) if such an individual has completed
less than two Years of Service, then such individual shall forfeit the entire
balance of his or her Matching Account; (ii) if such an individual has
completed two Years of Service but has not completed three Years of Service,
then such individual shall be entitled to 25% of the balance of his or her
Matching Account; (iii) if such an individual has completed three Years of
Service but has not completed four Years of Service, then such individual shall
be entitled to 50% of the balance of his or her Matching Account; (iv) if
such an individual has completed four Years of Service but has not completed
five Years of Service, then such individual shall be entitled to 75% of the
balance of his or her Matching Account; and (v) if such an individual has
completed five Years of Service as of the date of his or her termination of
employment, then such individual shall be entitled to receive the entire
balance of his or her Matching Account. 
In addition, a Participant who is employed by Solgar, Inc. on December 31,
2005 and who has at least two Years of Service but less than three Years of
Service shall never be entitled to less than 25% of his or her Matching
Account.

 

(2)  In the case of a Rexall Participant who has
a Profit Sharing Account, such Rexall Participant shall be entitled to receive
all or a portion of his or her Profit Sharing Account.  If a Rexall Participant has completed one
Year of Service but less than two Years of Service as of the date of his or her
termination of employment, then such Rexall Participant shall be entitled to
receive 33 % of his or her Matching Account. 
If such Rexall Participant has completed two Years of Service but less
than three Years of Service as of the date of his or her termination of
employment, then such Rexall Participant shall be entitled to receive 66 % of
his or her Matching Account.  If such
Rexall Participant has completed three Years of Service as of the date of his
or her termination of employment, then such Rexall Participant shall be
entitled to receive the entire balance of his or her Matching Account.

 

In the
event of the sale or disposition of a business or a sale of substantially all
of the assets of a trade or business, a participant affected by such sale may
be entitled to the entire balance of the participant’s Account, irrespective of
the participant’s Years of Service, if expressly provided in the documents
effecting the transaction or otherwise authorized by the Company.

 

Any
portion of a participant’s Matching Account and Special Bonus Account that the
participant is not entitled to receive pursuant to this Section 9.2(b) shall
be charged to such accounts and forfeited as of the earlier of (i) the
date the participant receives a distribution of his or her vested Account and (ii) the
date the participant incurs five consecutive 1-Year Breaks in 

 

43

 

Service.  If a participant who receives a distribution
of his or her vested Account, or is deemed to have received a distribution of
his or her Account because he or she is not vested in any portion of his or her
Account (including his or her Pre-Tax Account), is reemployed prior to
incurring five consecutive 1-Year Breaks in Service, then any forfeiture shall
be reinstated as prescribed in Section 12.2(b).

 

Section 9.3.         Time
and Form of Distribution of Account upon Termination of Employment.  (a)   
In General.  A Participant
or Rexall Participant shall be entitled to a distribution of his or her vested
Account upon the participant’s termination of employment with all Employers and
Affiliates.

 

(b)   Time of
Distribution.  A Participant or
Rexall Participant shall be entitled to a distribution of his or her vested
Account as soon as administratively practicable after the date of the participant’s
termination of employment with the Employers and Affiliates, or may defer
distribution to a later date; provided, however, that:

 

(i)            a
participant’s Account shall not be distributed prior to the participant’s 65th
birthday unless the participant has consented in writing to such distribution;

 

(ii)           if
a participant dies before the commencement of distribution of his or her
Account, distributions paid or commencing after the participant’s death shall
be completed no later than December 31 of the calendar year which contains
the fifth anniversary of the participant’s death, except that (i) if the
participant’s Beneficiary is the participant’s spouse, distribution may be
deferred until December 31 of the calendar year in which the participant
would have attained age 701⁄2 and (ii) if the participant’s Beneficiary is a
person other than the participant’s spouse and distributions commence on or
before December 31 of the calendar year immediately following the calendar
year in which the participant died, such distributions may be made over a
period not longer than the life expectancy of such Beneficiary;

 

(iii)          if
at the time of a participant’s death, distribution of his or her Account has
commenced, the remaining portion of the participant’s Account shall be paid at
least as rapidly as under the method of distribution being used prior to the
participant’s death, as determined pursuant to U.S. Treasury Regulation § 1.401(a)(9)-2;

 

(iv)          unless
a participant files a written election to defer distribution, distribution
shall be made to a participant by payment in a single lump sum payment no 

 

44

 

later than 60 days
after the end of the Plan Year which contains the latest of (i) the date
of the participant’s termination of employment, (ii) the tenth anniversary
of the date the participant commenced participation in the Plan and (iii) the
participant’s 65th birthday; provided, however, that if the
participant does not elect a distribution prior to the latest to occur of the
events listed above, the participant shall be deemed to have elected to defer
such distribution until a date no later than April 1 of the calendar year
following the calendar year in which the participant attains age 701⁄2; and

 

(v)           with
respect to a participant who continues in employment after attaining age 701⁄2,
distribution of the participant’s vested Account shall commence no later than
the participant’s required beginning date. 
For purposes of this paragraph, the term “required beginning date” shall
mean (A) with respect to a participant who is a 5%-owner (within the
meaning of section 416(i) of the Code), April 1 of the calendar
year following the calendar year in which the participant attains age 701⁄2 and (B) with
respect to any other participant, April 1 of the calendar year following
the calendar year in which the participant terminates employment with all
Employers and Affiliates.  Distributions
made under this paragraph shall be made in accordance with Section 9.3(c).  A participant is treated as a 5%-owner for
purposes of this Section if such participant is a 5%-owner as defined in section 416(i) of
the Code (determined in accordance with section 416 of the Code but
without regard to whether the Plan is a top-heavy plan) at any time during the
Plan Year in which such owner attains age 661⁄2 or any subsequent year.  Once distributions have begun to a 5%-owner
under this Section, they must continue to be distributed, even if he or she
ceases to be a 5%-owner.

 

(c)   Form and
Method of Distribution.  Any
distribution from an Account to which a Participant (or in the event of the
participant’s death, his or her Beneficiary) becomes entitled upon the
Participant’s termination of employment shall be distributed in cash, and any
to which a Rexall Participant (or in the event of the participant’s death, his
or her Beneficiary) becomes entitled upon the Rexall Participant’s termination
of employment shall be distributed in cash or in kind, by whichever of the
following methods the participant (or Beneficiary) elects:

 

(i)            a
lump sum;

 

(ii)           substantially
equal periodic installment payments, payable not less frequently than annually
and not more frequently than monthly, over a period to be elected by the
Participant (or Beneficiary); provided, however, that such period
shall not exceed the life expectancy of the Participant or, to the extent
permitted by Treasury Regulation § 1.401(a)(9)-5, the joint and last
survivor expectancy of the Participant and the Participant’s Beneficiary;

 

(iii)          a
joint and 50% survivor annuity; or

 

45

 

(iv)          a
joint and 100% survivor annuity.

 

A
participant (or Beneficiary) may change his or her election with respect to the
form of

 

distribution at any time
before benefits commence.

 

Section 9.4.         Distribution
of ESOP Account.  (a)    No Withdrawals or Loans.  An ESOP Participant shall not be permitted to
withdraw any portion of his or her ESOP Account while he or she remains in
employment with an Employer or Affiliate or to take a loan on his or her ESOP
Account at any time.

 

(b)   Termination of
Employment Under Circumstances Entitling ESOP Participant to Full Distribution
of ESOP Account.  If an ESOP
Participant’s employment with all Employers and Affiliates terminates under any
of the following circumstances, then the ESOP Participant or his or her
designated Beneficiary, as the case may be, shall be vested in and entitled to
receive one hundred percent (100%) of the entire amount then in the ESOP
Participant’s ESOP Account:

 

(i)            the
ESOP Participant’s death;

 

(ii)           the
ESOP Participant’s Disability; or

 

(iii)          the
ESOP Participant’s termination of employment after such ESOP Participant
attained age 65, completed four Years of Service and completed 1000 Hours of
Service after such four Years of Service.

 

In the
event of the sale or disposition of a business or a sale of substantially all
of the assets of a trade or business, an ESOP Participant affected by such sale
may be entitled to the entire balance of his or her ESOP Account, irrespective
of the ESOP Participant’s Years of Service, if expressly provided in the
documents effecting the transaction or otherwise authorized by the Company.

 

(c)   Other
Termination of Employment.  If an
ESOP Participant terminates employment with his or her Employer and is not
vested in his or her ESOP Account, then such 

 

46

 

ESOP Participant shall be deemed to have received a distribution of his
or her ESOP Account and the balance of the ESOP Account shall be forfeited.  If such former ESOP Participant is reemployed
prior to incurring five consecutive 1-Year Breaks in Service, then any
forfeiture shall be reinstated.

 

(d)   Time of
Distribution.  Unless an ESOP
Participant elects otherwise (in accordance with the provisions set forth in Section 9.3(b)(ii)-(v),
but as applied to an ESOP Account), the distribution of an ESOP Account shall
commence no later than one year after the close of the Plan Year in which the
ESOP Participant terminates employment with his or her Employer due to death,
Disability or after the attainment of age 65 and completion of five Years of
Service and no later than five years after the close of the Plan Year in which
an ESOP Participant terminates employment for any other reason.

 

(e)   Form and
Method of Distribution.  Any
distribution from an ESOP Account to which an ESOP Participant (or in the event
of the participant’s death, his or her Beneficiary) becomes entitled shall be
distributed in shares of NBTY Stock (or, with respect to assets other than NBTY
Stock, in cash) in the form of a lump sum or in annual installments over a
period not to exceed 15 years.  An ESOP
Participant (or Beneficiary) may change his or her election with respect to the
form of distribution at any time before benefits commence.  NBTY Stock shall be valued for distribution
purposes at the closing price of NBTY Stock on an established securities market
on the immediately preceding day on which NBTY Stock was traded.

 

(f)    Put Option.  If, and only if, NBTY Stock is not readily tradable
on an established market, then any ESOP Participant who is otherwise entitled
to a distribution of NBTY Stock under the Plan shall have the right
(hereinafter referred to as “Put Option”) to require that his or her Employer
or the Company repurchase any NBTY Stock under a fair 

 

47

 

valuation formula established by the independent appraiser
appointed.  The Put Option shall only be
exercisable during the sixty (60) day period immediately following the date of
distribution and if the Put Option is not exercised within such sixty (60) days
period, then it can be exercised for an additional period of sixty (60) days in
the following Plan Year.  This Put Option
shall be non-terminable within the meaning of U.S. Treasury regulation § 54.4975-11(a)(ii).

 

The
amount paid for NBTY Stock under the Put Option shall be paid in substantially
equal period payments (not less frequently than annually) over a period
beginning not later than thirty (30) days after the exercise of the Put Option
and not exceeding five (5) years. 
There shall be adequate security provided and reasonable interest paid
on any unpaid balance.

 

Section 9.5.            Payment
of Small Account Balances. 
Notwithstanding any provision of Section 9.3 or 9.4 to the contrary
and subject to Section 9.7, if the aggregate value of an individual’s
Account and his or her ESOP Account at any time following his or her
termination of employment does not exceed $1,000, then such amount shall be
distributed in a lump sum payment to the participant, the ESOP Participant or
his or her Beneficiary, as the case may be. 
The distributions of such amounts shall be made at the time determined
by the Administrator and the Recordkeeper.

 

Section 9.6.            Order
of Distribution.  Any distribution
pursuant to Section 9.2 shall be charged against a participant’s
contribution and investment subaccounts in the order determined by the
Administrator or Recordkeeper.

 

Section 9.7.            Direct
Rollover Option.  In the case of a
distribution that is an “eligible rollover distribution” within the meaning of section 402(c)(4) of
the Code, a Participant, Rexall Participant, ESOP Participant, a Beneficiary
who is a surviving spouse of a 

 

48

 

participant or an
ESOP Participant, or a spouse or former spouse of a participant or an ESOP
Participant who is an alternate payee under a qualified domestic relations
order, as defined in section 414(p) of the Code, may elect that all or any
portion of such distribution to which he or she is entitled shall be directly
transferred from the Plan to (i) an individual retirement account or
annuity described in section 408(a) or (b) of the Code, or (ii) if
the terms of which permit the acceptance of eligible rollover distributions, to
another retirement plan qualified under section 401(a) of the Code,
to a qualified annuity plan described in section 403(a) of the Code,
to an annuity contract described in section 403(b) of the Code or to
an eligible plan under section 457(b) of the Code which is maintained
by a state, political subdivision of a state, or any agency or instrumentality
of a state or political subdivision of a state and which agrees to account
separately for amounts transferred into such plan from this Plan.

 

Section 9.8.            Designation
of Beneficiary.  (a)    In General.  Each Participant, Rexall Participant and ESOP
Participant shall have the right to designate a Beneficiary or Beneficiaries
(who may be designated contingently or successively and that may be an entity
other than a natural person) to receive any distribution to be made under this Article upon
the death of such participant or ESOP Participant or, in the case of a
participant or ESOP Participant who dies after his or her termination of
employment but prior to the distribution of the entire amount to which he or
she is entitled under the Plan, any undistributed balance to which he or she
would have been entitled.  No such
designation of a Beneficiary other than a participant’s or ESOP Participant’s 

 

49

 

spouse shall be
effective if the participant was married through the one-year period ending on
the date of his or her death unless such designation was consented to in
writing (or by such other method permitted by the Internal Revenue Service) at
the time of such designation by the person who was the participant’s or ESOP
Participant’s spouse during such period, acknowledging the effect of such
consent and witnessed by a notary public or a Plan representative, or it is
established to the satisfaction of the Administrator or Recordkeeper that such
consent could not be obtained because such spouse could not be located or
because of the existence of other circumstances as the Secretary of the
Treasury may prescribe as excusing the requirement of such consent.  Subject to the immediately preceding
sentence, a participant or ESOP Participant may from time to time, without the
consent of any Beneficiary, change or cancel any such designation.  Such designation and each change thereof
shall be made in the manner prescribed by the Administrator and shall be filed
with the Administrator or Recordkeeper. 
If (i) no Beneficiary has been named by a deceased participant or
ESOP Participant or (ii) a Beneficiary designation is not effective
pursuant to the second sentence of this section, any undistributed Account of
the deceased shall be distributed by the Trustee (a) to the surviving
spouse of the deceased, if any, (b) if there is no surviving spouse, to
the then living descendants, if any, of the deceased, per stirpes, or (c) if
there is no surviving spouse and there are no living descendants, to the
executor or administrator of the estate of the deceased.  Unless otherwise set forth in the applicable
beneficiary designation form or the instructions thereto, if a Beneficiary
predeceases the participant or ESOP Participant, then any undistributed Account
of the deceased shall be distributed by the Trustee in the order prescribed by
the immediately preceding sentence.

 

(b)   Successor
Beneficiaries.  A Beneficiary who has
been designated in accordance with Section 9.8(a) may name a
successor beneficiary or beneficiaries in the manner prescribed by the
Administrator or Recordkeeper.  Unless
otherwise set forth in the applicable form pursuant to which a participant or
ESOP Participant designates a Beneficiary or the instructions thereto, if such
Beneficiary dies after the participant or ESOP Participant and before 

 

50

 

distribution of the entire amount of the benefit under the Plan in
which the Beneficiary has an interest, then any remaining amount shall be
distributed, as soon as practicable after the death of such Beneficiary, in the
form of a lump sum payment to the successor beneficiary or beneficiaries or, if
there is no such successor beneficiary, to the executor or administrator of the
estate of such deceased Beneficiary.

 

Section 9.9.            Missing
Persons.  If following the date on
which Participant’s or Rexall Participant’s Account may be distributed without
the participant’s consent pursuant to Section 9.3(b) or 9.5 or an
ESOP Participant’s ESOP Account may be distributed without his or her consent
pursuant to Section 9.4(c) or 9.5, the Administrator or Recordkeeper
in the exercise of reasonable diligence has been unable to locate the person or
persons entitled to the participant’s Account or his or her ESOP Account (after
sending a registered letter, return receipt requested, to the last know and
address, and after utilizing certified mail, checking records of related
employee benefit plans maintained by the Company, contacting such designated
Beneficiaries, and using a letter forwarding service (of the Internal Revenue
Service or Social Security Administration) and any further effort deemed
prudent by the Administrator or
Recordkeeper to ascertain the
whereabouts of such participant, ESOP Participant or Beneficiary), then the
participant’s Account or his or her ESOP Account, as the case may be, shall be
forfeited; provided, however, that to the extent required by law
the Plan shall reinstate and pay to such person or persons the amount so
forfeited upon a claim for such amount made by such person or persons.  The amount to be so reinstated shall be obtained
from the total amount that shall have been forfeited pursuant to this Section and
Sections 9.3(b) and 9.4(c) during the Plan Year that the claim for
such forfeited benefit is made, and shall not include any earnings or losses
from the date of the forfeiture under this Section.  If the amount to be 

 

51

 

reinstated exceeds
the amount of such forfeitures, an Employer shall make a contribution in an
amount equal to such Employer’s pro-rata share of such excess.  An Employer’s pro rata share shall be
determined by multiplying the amount of such forfeitures by a fraction, the
numerator of which is equal to the number of Associates employed by such
Employer who made a claim for such forfeited benefits and the denominator of
which is the number of all Associates who made a claim for such forfeited
benefits.  To the extent the forfeitures
under this Section exceed any claims for forfeited benefits made pursuant
to this Section, such excess shall be applied in accordance with Section 8.8.

 

Section 9.10.       Distributions
to Minor and Disabled Distributees. 
Any distribution that is payable to a distributee who is a minor or to a
distributee who has been legally determined to be unable to manage his or her
affairs by reason of illness or mental incompetency may be made to, or for the
benefit of, any such distributee at such time consistent with the provisions of
this Plan and in such of the following ways as the legal representative of such
distributee shall direct:  (a) directly
to any such minor distributee if, in the opinion of such legal representative,
such minor is able to manage his or her affairs, (b) to such legal
representative, (c) to a custodian under a Uniform Gifts to Minors Act for
any such minor distributee, or (d) as otherwise directed by such legal
representative.  Neither the
Administrator nor the Trustee shall be required to oversee the application by
any third party other than the legal representative of a distributee of any
distribution made to or for the benefit of such distributee pursuant to this
Section.

 

ARTICLE 10

 

LOANS

 

Section 10.1.          Making
of Loans.  Subject to the provisions
of this Article 10, the Recordkeeper shall establish a loan program
whereby any Participant or Rexall Participant who 

 

52

 

is an Associate
and who has no outstanding loans may request, by such method prescribed by the
Recordkeeper, to borrow funds from the participant’s Account.  The principal balance of such loan, shall not
exceed the lesser of:

 

(a)   $50,000 less the
highest outstanding principal during the previous 12 months; and

 

(b)   fifty percent
(50%) of the vested portion of the participant’s Account, excluding his or her
ESOP Account, as of the Valuation Date coinciding with or immediately preceding
the date on which the loan is made.

 

Section 10.2.          Restrictions.  An application for a loan shall be made at
the time and in the manner prescribed by the Recordkeeper.  The action of the Recordkeeper in approving
or disapproving a request for a loan shall be final.  Any loan under the Plan shall be subject to
the terms, conditions and restrictions set forth in the loan program
established by the Recordkeeper.  The
minimum loan amount is $1,000.  A
Participant or Rexall Participant may have only one loan outstanding at any
given time.  Notwithstanding anything
herein to the contrary, a Participant who was performing services for Solgar, Inc.
before January 1, 2006 may request to have a maximum of four regular loans
and one home loan outstanding at any given time; provided, however,
that each such loan must have been requested before January 1, 2006.

 

Section 10.3.          Default.  If any loan or portion of a loan made to a
Participant or a Rexall Participant under the Plan, together with the accrued
interest thereon, is in default, the Trustee, upon direction from the
Administrator, shall take appropriate steps to collect the outstanding balance
of the loan and to foreclose on the security; provided, however,
that the Trustee shall not levy against any portion of such a participant’s
Account until such time as a 

 

53

 

distribution from
such Account otherwise could be made under the Plan.  Default shall occur (i) if the
participant fails to make any scheduled loan payment when due or within 90 days
thereafter (or within such other grace period as permitted under applicable law
and by the Administrator) or (ii) upon the occurrence of any other event
that is considered a default event under the loan program established by the
Recordkeeper.  On the date a participant
is entitled to receive a distribution of his or her Account pursuant to Article 9,
any defaulted loan or portion thereof, together with the accrued interest
thereon, shall be charged to the participant’s Account after all other
adjustments required under the Plan, but before any distribution pursuant to Article 9.

 

Section 10.4.          Applicability.  Notwithstanding the foregoing, for purposes
of this Article 10, any participant or Beneficiary who is a “party in
interest” as defined in section 3(14) of ERISA may apply for a loan from
his or her Account under the Plan, regardless of such participant’s or
Beneficiary’s employment status.  As a
condition of receiving such a loan, such a participant or Beneficiary who is
not an Associate shall consent to have such loan repaid in substantially equal
installments at the times and in the manner determined by the Administrator,
but not less frequently than quarterly.

 

ARTICLE 11

 

ESOP LOANS

 

The
Administrator may direct the Trustee to incur a loan on behalf of the Trust in
a manner and under conditions which will cause the loan to be an “exempt loan”
within the meaning of section 4975(d)(2) of the Code and Treasury
regulations promulgated thereunder.  A
loan shall be used primarily for the benefit of ESOP Participants and their
Beneficiaries.  The proceeds of such loan
shall be used, within a reasonable time after the loan is obtained, only to
purchase NBTY Stock, to repay the loan or to repay any prior loan.  Any such loan shall provide 

 

54

 

for a reasonable rate of
interest, an ascertainable period of maturity and shall be without recourse
against the Plan.  Any such loan shall be
secured solely by shares of NBTY Stock acquired with the proceeds of the loan
and shares of such stock that were used as collateral on a prior loan which was
repaid with the proceeds of the current loan. 
Such stock pledged as collateral shall be placed in an ESOP Suspense Account
and released pursuant to the next paragraph as the loan is repaid.  NBTY Stock released from the ESOP Suspense
Account shall be allocated in the manner described in Section 8.6.  No person entitled to payment under a loan
made pursuant to this Section shall have recourse against any Trust fund
assets other than the stock used as collateral for the loan, Company
contributions of cash that are available to meet obligations under the loan and
earnings attributable to such collateral and the investment of such
contributions.  Contributions made under Article 5
with respect to any Plan Year during which the loan remains unpaid, and
earnings on such contributions, shall be deemed available to meet obligations
under the loan, unless otherwise provided by the Company at the time such
contribution is made.

 

Any
pledge of NBTY Stock as collateral under this Section shall provide for
the release of shares so pledged upon the payment of any portion of the
loan.  Shares so pledged shall be
released in the proportion that the principal and interest paid on the loan for
the Plan Year bears to the aggregate principal and interest paid for the
current Plan Year and each Plan Year thereafter, as provided in U.S. Treasury
Regulation § 54.4975-7(b)(8).

 

Payments
of principal and interest on any loan under this Section shall be made by
the Trustee at the direction of the Administrator solely from:  (i) contributions under Article 5
available to meet obligations under the loan, (ii) earnings form the
investment of such contributions, (iii) earning attributable to stock
pledged as collateral for the loan, (iv) the proceeds of a subsequent loan
made to repay the loan, and (v) the proceeds of the sale of any 

 

55

 

stock pledged as
collateral for the loan.  The
contributions and earnings available to pay the loan must be accounted for
separately by the Administrator until the loan is repaid.

 

Subject
to the limitations of Section 6.3 on annual additions to an ESOP
Participant’s Account, assets released from an ESOP Suspense Account by reason
of payment made on a loan shall be allocated immediately upon such payment to
the accounts of all ESOP Participants who then would be entitled to an
allocation of contributions if such payment had been made on the last day of
the Plan Year.

 

ARTICLE 12

 

SPECIAL PARTICIPATION AND DISTRIBUTION RULES

 

Section 12.1.          Change
of Employment Status.  If an
Associate who is not an Eligible Associate or Eligible Rexall Associate becomes
an Eligible Associate, then the Associate shall become a Participant (i) as
of the date such Associate becomes an Eligible Associate, if the Associate then
has satisfied the service requirement set forth in Section 3.1, or (ii) as
of the date the Associate satisfies the service requirement set forth in Section 3.1.  If an Eligible Rexall Associate becomes an
Associate of an Employer other than Rexall Sundown, Inc. or any subsidiary
thereof, then such Associate shall become Participant (i) as of the date
the Associate becomes an Eligible Associate, if the Associate then has
satisfied the service requirement set forth in Section 3.1, or (ii) as
of the date the Associate satisfies the service requirement set forth in Section 3.1.

 

Section 12.2.          Reemployment.  (a)   
Participation.  If an
Associate whose employment with all Employers terminates before the Associate
satisfied the service requirement set forth in Section 3.1(a) is
reemployed by an Employer, the Associate’s prior service shall be
disregarded.  If an Associate whose
employment with all Employers terminated before the Associate satisfied the
service requirement set forth in Section 3.1(b) is reemployed 

 

56

 

by an Employer,
the Associate’s prior service shall be disregarded for purposes of the
employees’ stock ownership provisions of the Plan.  If an individual who satisfied the service
requirement set forth in Section 3.1(a) or (b) but who
terminated employment before the first day of the month following the month in
which such service requirement was satisfied is reemployed as an Eligible
Associate before a 1-Year Break in Service has occurred, then such individual
again shall become a participant or an ESOP Participant (or both) pursuant to Section 3.1(a) or
(b), as applicable, as of the date of his or her reemployment or, if later, the
date he or she would otherwise have been eligible to participate in the Plan
pursuant to Section 3.1(a) or (b), as applicable, had he or she not
terminated employment.  If an individual
who was a participant terminated employment with an Employer and is reemployed
by an Employer, the individual shall be eligible to participate as a
Participant as of the first day of the month coinciding with or next following
on or after his or her reemployment date. 
If an individual who was an ESOP Participant terminated employment with
his or her Employer and is reemployed by an Employer, then the individual shall
again become an ESOP Participant as of the January 1st or July 1st
coincident with or next following his
or her reemployment date.  If a participant
or ESOP Participant whose employment with the Employers is terminated is
receiving installment payments pursuant to Section 9.3(c) or Section 9.4,
such payments shall be suspended upon such participant’s or ESOP Participant’s
reemployment unless he or she has attained age 591⁄2 on or before the date of
such reemployment.

 

(b)   Restoration of
Forfeitures.  If a Participant,
Rexall Participant or ESOP Participant whose employment with the Employers is
terminated is reemployed prior to incurring five consecutive 1-Year Breaks in
Service, and, at or after his or her termination of employment, any portion of
his or her accounts was forfeited pursuant to Section 9.2(b) or Section 9.4(c),
then 

 

57

 

an amount equal to
the portion of his or her accounts that was forfeited shall be credited to his
or her accounts as soon as administratively practicable after he or she is
reemployed.  Any amount to be restored
pursuant to this subsection shall be obtained from the total amounts that
have been forfeited pursuant to Sections 9.2(b), 9.4(c) and 9.9, as
applicable, during the Plan Year in which such participant or ESOP Participant
is reemployed from the Accounts and ESOP Accounts, as applicable, of
participants and ESOP Participants employed by the same Employer as the
reemployed participant or ESOP Participant, as the case may be.  If the aggregate amount to be so restored to
the Accounts and ESOP Accounts of participants and ESOP Participants who are
Associates of a particular Employer exceeds the amount of such applicable
forfeitures, such Employer shall make a contribution in an amount equal to the
excess.  Any such contribution shall be
made regardless of whether the limitations set forth in Article 6 will be
exceeded by such contribution.

 

(c)   Service.  In the case of a participant or ESOP
Participant who was vested when his or her employment with the Employers and
Affiliates terminated, any service attributable to the his or her prior period
of employment shall be reinstated as of the date of his or her reparticipation.
In the case of an Associate who was not a participant or ESOP Participant
during his or her prior period of employment or in the case of a participant or
ESOP Participant who was not fully vested when his or her prior period of
employment terminated, any service attributable to his or her prior period of
employment with the Employers and Affiliates shall not be cancelled unless one
of the following is applicable:  (A) the
number of his or her consecutive years of 1-Year Breaks in Service was less
than the aggregate number of Years of Service earned before his or her first 1-Year
Break in Service (determined without regard to whether participation in the
Plan had commenced); (B) the Associate’s 1-Year Break(s) in Service 

 

58

 

commenced on or
after May 1, 1986 and the number of his or her consecutive years of 1-Year
Breaks in Service was less than five (5); (C) the Associate’s 1-Year
Breaks in Services commenced on or after May 1, l986 due to a “maternity
or paternity leave of absence” and the number of his or her consecutive years
of 1-Year Breaks in Service was less than the aggregate number of years in his
or her pre-break Service plus one year (considering Service determined without
regard to whether participation in the Plan had commenced); or (D) the
Associate’s 1-Year Breaks in Service commenced on or after May 1, l986 due
to a “maternity or a paternity leave of absence” and the number of his or her
consecutive years of 1-Year Breaks in Service was less than six (6).

 

Section 12.3.       Employment
by Affiliates.  If an individual is
employed by an Affiliate that is not an Employer, then any period of employment
with such Affiliate shall be taken into account under the Plan solely for the
purposes of (i) measuring such individual’s Hours of Service and Years of
Service and (ii) determining when such individual has terminated his or
her employment for purposes of the Plan, to the same extent it would have been
had such period of employment been as an Associate.

 

Section 12.4.       Reemployment
of Veterans.  (a)  In General.  The provisions of this Section shall
apply in the case of the reemployment by an Employer of an Associate, within
the period prescribed by USERRA, after the Associate’s completion of a period
of Qualified Military Service.  The
provisions of the Plan are intended to provide such an individual with the
rights required by USERRA and section 414(u) of the Code, and shall be
interpreted in accordance with such intent.

 

(b)   Make-Up of
Pre-Tax Contributions.  Such an
Eligible Associate or Eligible Rexall Associate described in Section 12.4(a) shall
be entitled to make contributions under the 

 

59

 

Plan (“make-up participant contributions”), in addition to any Pre-Tax
Contribution which he or she elects to have made under the Plan pursuant to Section 4.1
or 4.3(a).  From time to time while
employed by an Employer, such Eligible Associate or Eligible Rexall Associate
may elect to contribute such make-up participant contributions during the
period beginning on the date of his or her reemployment and ending on the
earlier of:

 

(i)            the
end of the period equal to the product of three and such period of Qualified
Military Service, and

 

(ii)           the
fifth anniversary of the date of such reemployment.  Such Eligible Associate or Eligible Rexall
Associate shall not be permitted to contribute make-up participant
contributions to the Plan in excess of the amount which such individual could
have elected to have made under the Plan in the form of Pre-Tax Contributions
if he or she had continued in active employment with his or her Employer during
such period of Qualified Military Service. 
The manner in which an Eligible Associate or Eligible Rexall Associate
may elect to contribute make-up participant contributions pursuant to this subsection (b) shall
be prescribed by the Administrator or Recordkeeper.

 

(c)   Make-Up of
Matching Contributions.  An Eligible
Associate or Eligible Rexall Associate who contributes make-up participant
contributions as described in subsection (b) of this Section shall
be entitled to an allocation of Matching Contributions to his or her Account in
an amount equal to the amount of Matching Contributions that would have been
allocated to his or her Account during the period of Qualified Military Service
if such make-up participant contributions had been made in the form of Pre-Tax
Contributions during such period.  The
amount necessary to make such allocation of Matching Contributions shall be
derived from forfeitures during the Plan Year in which such Matching
Contributions are made, 

 

60

 

and if such
forfeitures are not sufficient for this purpose, then the Eligible Associate’s
or Eligible Rexall Associate’s Employer shall make a special contribution to
the Plan which shall be utilized solely for purposes of such allocation.

 

(d)   Miscellaneous Rules Regarding
Make-Up Contributions.  For purposes
of determining the amount of contributions to be made under this Section, an
individual’s “Compensation” during any period of Qualified Military Service
shall be determined in accordance with section 414(u) of the Code.  Any contributions made by an Eligible
Associate, an Eligible Rexall Associate or an Employer pursuant to this Section on
account of a period of Qualified Military Service in a prior Plan Year shall
not be subject to the limitations prescribed by Sections 6.1, 6.3 and 6.4 of
the Plan (relating to sections 402(g), 415, and 404 of the Code) for the Plan
Year in which such contributions are made. 
The Plan shall not be treated as failing to satisfy the
nondiscrimination rules of Section 6.2 of the Plan (relating to
sections 401(k)(3) and 401(m) of the Code) for any Plan Year solely on
account of any make-up contributions made by an Eligible Associate, an Eligible
Rexall Associate or an Employer pursuant to this Section.

 

(e)   Suspension of
Loan Repayments.  Loan repayments may
be suspended under the Plan as permitted under section 414(u) of the Code.

 

ARTICLE 13

 

ADMINISTRATION

 

Section 13.1.       The
Administrator.  (a)    The Administrator shall be the “administrator”
of the Plan within the meaning of such term as used in ERISA and shall be
responsible for the administration of the Plan.

 

(b)   No individual
employed by the Administrator who is a Participant, Rexall Participant or ESOP
Participant shall take part in any action of the Administrator or any matter
involving solely his or her rights under the Plan.

 

61

 

(c)   The Administrator
shall have the duty and authority to interpret and construe, in its sole
discretion, the terms of the Plan in all respects, including, but not limited
to, all questions of eligibility, the status and rights of Participants, Rexall
Participants and ESOP Participants, distributees and other persons under the
Plan, and the manner, time and amount of payment of any distribution under the
Plan. All determinations and actions of the Administrator shall be conclusive
and binding upon all affected parties, except that the Administrator may revoke
or modify a determination or action that it determines to have been in
error.  Benefits will be paid under the
Plan only if the Administrator decides in its sole discretion that the
applicant is entitled to the benefits.

 

(d)   The Administrator
shall direct the Trustee to make payments of amounts to be distributed from the
Trust under Article 9.

 

(e)   The Administrator
may adopt such rules, regulations, and procedures as it deems necessary for the
conduct of its affairs and the administration of the Plan, provided that any
such rules, regulations, and procedures shall be consistent with the provisions
of the Plan and ERISA, and such rules, regulations, and procedures shall be
binding upon all participants and Beneficiaries.

 

(f)    The Administrator
shall discharge its duties as administrator with respect to the Plan (i) solely
in the interest of the participants and Beneficiaries, (ii) for the
exclusive purpose of providing benefits to the participants and Beneficiaries
and of defraying reasonable expenses of administering the Plan and (iii) with
the care, skill, prudence, and diligence under the circumstances then
prevailing that a prudent person acting in a like capacity and familiar with
such matters would use in the conduct of an enterprise of a like character and
with like aims.  The Employers hereby
jointly and severally indemnifies and holds harmless the Trustee from the 

 

62

 

effects and consequences of its acts, omissions and conduct in its
official capacity, except to the extent that such effects and consequences
result from its own willful or gross misconduct or criminal acts.

 

Section 13.2.          Named
Fiduciary.  The Company shall be a “named
fiduciary” of the Plan within the meaning of such term as used in ERISA solely
with respect to its powers specifically set forth herein.

 

Section 13.3.          Allocation
and Delegation of Responsibilities. 
The Administrator, the Company, and any Employer may allocate their
responsibilities and may delegate to any person, partnership, corporation or a
committee to carry out any of their responsibilities with respect to the
Plan.  Any such allocation or designation
shall be in writing and shall be kept with the records of the Plan.

 

Section 13.4.          Professional
and Other Services.  Each of the
Administrator, the Company, and the Employers may employ counsel (who may be
counsel for an Employer), specialists, advisers, and agents (including
non-fiduciaries) to advise it and its agents or delegates and may arrange for
clerical and other services as the Administrator, the Company or the Employer
and its agents may require in carrying out its duties hereunder.  The Trustee may compensate such agents or
advisers from the assets of the Plan as fiduciary expenses (but not including
any business (settlor) expenses of an Employer) to the extent not paid by any
Employer.

 

Section 13.5.          Claims
Procedure.  Any Participant, Rexall
Participant, ESOP Participant or distributee (or his or her duly authorized
representative) who believes he or she is entitled to benefits in an amount
greater than those which he or she has been notified he or she is entitled to
receive, is receiving or has received may file a claim with the
Administrator.  Such 

 

63

 

a claim shall be
in writing and state the nature of the claim, the facts supporting the claim,
the amount claimed and the address of the claimant.  The Administrator shall review the claim and,
within 90 days after receipt of the claim, give written notice to the claimant
of its decision with respect to the claim. 
If special circumstances require an extension of time, the claimant
shall be so advised in writing or by electronic means within the initial 90-day
period and in no event shall such an extension exceed 90 days.  The notice of the decision of the
Administrator with respect to the claim shall be written in a manner calculated
to be understood by the claimant and, if the claim is wholly or partially
denied, shall set forth the specific reasons for the denial, specific
references to the pertinent Plan provisions on which the denial is based, a
description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why such material or
information is necessary, and an explanation of the claim review procedure
under the Plan and the time limits applicable to such procedure (including a
statement of the claimant’s right to bring a civil action under section 502(a) of
ERISA following the final denial of a claim).

 

The
claimant (or his or her duly authorized representative) may request a hearing
of the denial by filing with the Administrator a written request for such hearing
within 60 days after notice of the denial has been received by the
claimant.  Within the same 60-day period,
the claimant may submit to the Administrator written comments, documents,
records and other information relating to the claim.  Upon request and free of charge, the claimant
also may have reasonable access to, and copies of, documents, records and other
information relevant to the claim.  If a
request for review is so filed, then the Administrator shall then conduct a
hearing within the same 60-day period, at which the claimant may be represented
by an attorney or any other representative of such claimant’s choosing and
expense and at which the claimant shall 

 

64

 

have an opportunity to
submit written and oral evidence and arguments in support of the claim.  At the hearing (or prior thereto upon five (5) business
days’ written notice to the Administrator) the claimant or the claimant’s
representative shall have an opportunity to review all documents in the
possession of the Administrator which are pertinent to the claim at issue and
its disallowance.  Either the claimant or
the Administrator may cause a court reporter to attend the hearing and record
the proceedings.  In such event, a
complete written transcript of the proceedings shall be furnished to both
parties by the court reporter.  The full
expense of any such court reporter and such transcripts shall be borne by the
party who requests or requested the court reporter to attend the hearing.  A final, written decision as to the allowance
of the claim shall be made by the Administrator within sixty (60) days of
receipt of the appeal request unless special circumstances require an extension
of time provided that the delay and the special circumstances are communicated
in writing to the claimant within the 60-day period.  If the appeal of the claim is wholly or
partially denied, the notice of the Administrator’s final decision shall
include specific reasons for the denial, specific references to the pertinent
Plan provisions on which the denial is based and a statement that the claimant
is entitled, upon request and free of charge, to reasonable access to, and
copies of, all relevant documents, records and information.  The notice shall be written in a manner
calculated to be understood by the claimant and shall notify the claimant of
his or her right to bring a civil action under section 502(a) of
ERISA.  The claimant must file a civil
action with respect to the denied claim not later than one hundred eighty (180)
days following the date of the Administrator’s final determination.

 

In
making determinations regarding claims for benefits, the Administrator shall
consider all of the relevant facts and circumstances, including, without
limitation, governing plan documents, consistent application of Plan provisions
with respect to similarly situated claimants 

 

65

 

and any comments,
documents, records and other information with respect to the claim submitted by
the claimant (the “Claimant’s Submissions”). 
The Claimant’s Submissions shall be considered by the Administrator
without regard to whether the Claimant’s Submissions were submitted or
considered by the Administrator in the initial benefit determination.

 

Section 13.6.          Notices
to Participants, Etc.  All notices,
reports and statements given, made, delivered or transmitted to a participant,
ESOP Participant or distributee or any other person entitled to or claiming
benefits under the Plan shall be deemed to have been duly given, made,
delivered or transmitted when provided via such written or other means as may
be permitted by applicable regulations promulgated by the U.S. Treasury
Department.  A participant, ESOP Participant,
distributee or other person may record any change of his or her address by
written notice filed with his or her Employer.

 

Section 13.7.          Notices
to Administrator or Employers. 
Written directions and notices and other written or electronic
communications from participants, ESOP Participants, distributees or other
persons entitled to or claiming benefits under the Plan to the Administrator or
the Employers shall be deemed to have been duly given, made, delivered or
transmitted when given, made, delivered or transmitted in the manner and to the
location prescribed by the Administrator or the Employers for the giving of
such directions, notices and other communications.

 

Section 13.8.          Records.  The Administrator shall keep a record of all
of its proceedings with respect to the Plan and shall keep or cause to be kept
all books of account, records and other data as may be necessary or advisable
in its judgment for the administration of the Plan.

 

66

 

Section 13.9.          Reports
of Trustee and Accounting to Participants. 
The Administrator shall keep on file, in such form as it shall deem
convenient and proper, all reports concerning the Trust Fund received by it
from the Trustee, and, as soon as practicable after the close of each Plan
Year, each participant, ESOP Participant and Beneficiary shall be provided a
written benefit statement indicating the balance credited to any Account for
such individual as of the close of such Plan Year.  Any participant, ESOP Participant or
Beneficiary claiming that an error has been made with respect to such balance
shall notify the Administrator in writing within ninety (90) days following the
delivery of such benefit statement.  If
no notice of error timely is provided, the benefit statement shall be presumed
to be correct.

 

ARTICLE 14

 

PARTICIPATION BY EMPLOYERS

 

Section 14.1.          Adoption
of Plan.  With the consent of the
Company, any entity may become an Employer under the Plan by (a) taking
such action as shall be necessary to adopt the Plan and (b) executing and
delivering such instruments and taking such other action as may be necessary or
desirable to put the Plan and Trust into effect with respect to such entity, as
prescribed by the Administrator.  The
powers and control of the Company, as provided in the Plan and the trust
agreement, shall not be diminished by reason of participation of any such
adopting entity in the Plan.

 

Section 14.2.          Withdrawal
from Participation.  An Employer may
withdraw from participation in the Plan at any time by filing with the Company
a duly certified copy of a written instrument duly adopted by an Employer to
that effect and giving notice of its intended withdrawal to the Company, the
Employers and the Trustee prior to the effective date of withdrawal.

 

67

 

Section 14.3.          Company,
Administrator and Recordkeeper as Agents for Employers.  Each entity which becomes an Employer
pursuant to Section 14.1 or Section 14.4 by so doing shall be deemed
to have appointed the Company, the Administrator and the Recordkeeper as its
agents to exercise on its behalf all of the powers and authorities conferred
upon the Company, the Administrator and the Recordkeeper by the terms of the
Plan.  The authority of the Company, the
Administrator and the Recordkeeper to act as such agent shall continue unless
and until the portion of the Trust Fund held for the benefit of Associates of
the particular Employer and their Beneficiaries is set aside in a separate
Trust Fund as provided in Section 17.2.

 

Section 14.4.          Continuance
by a Successor.  In the event that an
Employer other than the Company is reorganized by way of merger, consolidation,
transfer of assets or otherwise, so that another entity other than an Employer
succeeds to all or substantially all of such Employer’s business, such
successor entity may, with the consent of the Company, be substituted for such
Employer under the Plan by adopting the Plan. 
Contributions by such Employer automatically shall be suspended from the
effective date of any such reorganization until the date upon which the
substitution of such successor entity for an Employer under the Plan becomes
effective.  If, within 90 days following
the effective date of any such reorganization, such successor entity shall not
have elected to adopt the Plan, the Company fails to consent to such adoption,
or an Employer adopts a plan of complete liquidation other than in connection
with a reorganization, the Plan automatically shall be terminated with respect
to employees of such Employer as of the close of business on the 90th day
following the effective date of such reorganization or as of the close of
business on the date of adoption of such plan of complete liquidation, as the
case may be, and the Administrator shall direct the Trustee to 

 

68

 

distribute the
portion of the Trust Fund applicable to such Employer in the manner provided in
Section 17.3.

 

If such successor entity is substituted for an
Employer as described above, then, for all purposes of the Plan, employment of
each Associate with such Employer, including service with and compensation paid
by such Employer, shall be considered to be employment with such successor
entity.

 

ARTICLE 15

 

MISCELLANEOUS

 

Section 15.1.          Expenses.  All costs and expenses of administering the
Plan and the Trust, including the expenses of Employer and the Administrator,
the fees of counsel and of any agents for an Employer, investment advisory and
record keeping fees, the fees and expenses of the Trustee, the fees of counsel
for the Trustee and other administrative expenses, shall be paid out of the
Trust Fund unless paid by an Employer. 
The Administrator, in its sole discretion, having regard to the nature
of a particular expense, shall determine the portion of such expense that is to
be borne by each Employer.  An Employer
may seek reimbursement of any expense paid by such Employer that the
Administrator determines is properly payable from the Trust Fund.  Until paid, expenses shall constitute a
liability of the Plan.

 

Section 15.2.          Non-Assignability.

 

(a)   In General.  No right or interest of any participant, ESOP
Participant or Beneficiary in the Plan shall be assignable or transferable in
whole or in part, either directly or by operation of law or otherwise, including,
but not by way of limitation, execution, levy, garnishment, attachment, pledge
or bankruptcy, but excluding devolution by death or mental incompetency, and
any attempt to do so shall be void, and no right or interest of any
participant, ESOP Participant or Beneficiary in the Plan shall be liable for,
or subject to, any obligation or 

 

69

 

liability of such participant, ESOP Participant or Beneficiary,
including claims for alimony or the support of any spouse, except as provided
below.

 

(b)   Exception for
Qualified Domestic Relations Orders. 
Notwithstanding any provision of the Plan to the contrary, if a
participant’s Account or an ESOP Participant’s ESOP Account under the Plan, or
any portion thereof, is the subject of one or more qualified domestic relations
orders (as defined in section 414(p) of the Code), such Account or ESOP
Account or portion of either shall be paid to the individual, at the time and
in the manner specified in any such order. 
The Administrator shall adopt rules and procedures, in accordance
with section 414(p) of the Code, relating to its (i) review of any
domestic relations order for purposes of determining whether the order is a
qualified domestic relations order and (ii) administration of a qualified
domestic relations order.  A domestic
relations order shall not fail to constitute a qualified domestic relations
order solely because such order provides for distribution to an alternate payee
of the benefit assigned to the alternate payee under the Plan prior to the
applicable participant’s or ESOP Participant’s earliest retirement age (as
defined in section 414(p) of the Code) under the Plan.

 

(c)   Other Exception.  Notwithstanding any provision of the Plan to
the contrary, if a participant or ESOP Participant is ordered or required to
pay an amount to the Plan pursuant to (i) a judgment in a criminal action,
(ii) a civil judgment in connection with a violation (or alleged
violation) of Part 4 of Subtitle B of Title I of ERISA or (iii) a settlement
agreement between the Secretary of Labor and the participant or ESOP
Participant or the Pension Benefit Guaranty Corporation and the participant or
ESOP Participant in connection with a violation (or alleged violation) of Part 4
of Subtitle B of Title I of ERISA, the participant’s Account or his or 

 

70

 

her ESOP Account, as the case may be, may, to the extent permitted by
law, be offset by such amount.

 

Section 15.3.       Employment
Non-Contractual.  The Plan confers no
right upon an Associate to continue in employment.

 

Section 15.4.       Merger
or Consolidation with Another Plan. 
A merger or consolidation with, or transfer of assets or liabilities to,
any other plan shall not be effected unless the terms of such merger,
consolidation or transfer are such that each participant, ESOP Participant,
distributee, Beneficiary or other person entitled to receive benefits from the
Plan would, if the Plan were to terminate immediately after the merger,
consolidation or transfer, receive a benefit equal to or greater than the
benefit such person would be entitled to receive if the Plan were to terminate
immediately before the merger, consolidation, or transfer.

 

Section 15.5.       Gender
and Plurals.  Wherever used in the Plan,
words in the masculine gender shall include the masculine or feminine gender,
and, unless the context otherwise requires, words in the singular shall include
the plural, and words in the plural shall include the singular.

 

Section 15.6.       Applicable
Law.  The Plan and all rights
hereunder shall be governed by and construed in accordance with the laws of New
York to the extent such laws have not been preempted by applicable federal law.

 

Section 15.7.       Severability.  If any provision of the Plan is held illegal
or invalid, the illegality or invalidity shall not affect the remaining
provisions of the Plan and the Plan shall be construed and enforced as if the
illegal or invalid provision had not been included in the Plan.

 

71

 

Section 15.8.       No
Guarantee.  None of the Company, the
Employers, the Administrator or the Trustee in any way guarantees the Trust
from loss or depreciation nor the payment of any benefit that may be or become
due to any person from the Trust Fund. 
Nothing in the Plan shall be deemed to give any participant, distributee
or Beneficiary an interest in any specific part of the Trust Fund or any other
interest except the right to receive benefits from the Trust Fund in accordance
with the provisions of the Plan and the trust agreement.

 

Section 15.9.       Plan
Voluntary.  Although it is intended
that the Plan shall be continued and that contributions shall be made as herein
provided, the Plan is entirely voluntary on the part of the Employers and the
continuance of the Plan and the contributions hereunder are not and shall not
be regarded as contractual obligations of the Employers.

 

ARTICLE 16

 

TOP-HEAVY PLAN REQUIREMENTS

 

Section 16.1.       Top-Heavy
Plan Determination.  If as of the
determination date (as defined in Section 16.2(a)(1)) for any Plan Year
the account balances under the Plan, of all participants and ESOP Participants
who are key employees (as defined in Section 16.2(a)(2)) for such Plan
Year exceeds 60% of the aggregate of the account balances and the present value
of accrued benefits of all participants and ESOP Participants in the Plan as of
the determination date, then the Plan shall be a “top-heavy plan” with respect
to such participants and ESOP Participants for such Plan Year, and the requirements
of Sections 16.3 and 16.4 shall be applicable for such Plan Year as of the
first day thereof.

 

Section 16.2.       Definitions
and Special Rules.

 

(a)   Definitions.  For purposes of this Article 16, the
following definitions shall apply:

 

72

 

(1)  Determination Date.  The determination date for all plans in the
aggregation group shall be the last day of the preceding Plan Year, and the
valuation date applicable to a determination date shall be (i) in the case
of a defined contribution plan, the date as of which account balances are
determined that coincides with or immediately precedes the determination date,
and (ii) in the case of a defined benefit plan, the date as of which the
most recent actuarial valuation for the Plan Year that includes the
determination date is prepared, except that if any such plan specifies a
different determination or valuation date, such different date shall be used
with respect to such plan.

 

(2)  Key Employee.  Any Associate or former Associate (or any
Beneficiary of such Associate) who, at any time during the Plan Year containing
the determination date, was (i) an officer of an Employer having annual
compensation greater than $140,000 (as adjusted under section 416(i)(1) of
the Code for Plan Years beginning after December 31, 2002), (ii) a 5-percent
owner of an Employer, or (iii) a 1-percent owner of an Employer having
annual compensation of more than $150,000. 
The determination of who is a Key Employee will be made in accordance
with section 416(i)(1) of the Code.

 

(3)  Compensation.  Compensation shall have the meaning set forth
in U.S. Treasury Regulation § 1.415-2(d).

 

(b)   Special Rules.  For the purpose of determining the accrued
benefit or account balance of a participant, (i) the accrued benefit or
account balance of any person who has not performed services for an Employer at
any time during the one-year period ending on the determination date shall not
be taken into account pursuant to this Section, and (ii) any person who
received a distribution from a plan (including a plan that has terminated) in
the aggregation group during the one-year period ending on the determination
date shall be treated as a participant in such plan, and any such distribution
shall be included in such participant’s account balance or accrued benefit, as
the case may be; provided, however, that in the case of a
distribution made for a reason other than a person’s severance from employment,
death or disability, clause (ii) of this Section 16.2(b) shall
be applied by substituting “five-year period” for “one-year period.”

 

Section 16.3.          Minimum
Contribution for Top-Heavy Years. 
Notwithstanding any provision of the Plan to the contrary, for any Plan
Year for which the Plan is a top-heavy plan, a minimum contribution shall be
made on behalf of each participant (other than a key 

 

73

 

employee) who is
an Associate on the last day of the Plan Year in an amount equal to the lesser
of (i) 3% of such participant’s compensation during such Plan Year and (ii) the
highest percentage at which Employer contributions (including Pre-Tax
Contributions) are made on behalf of any key employee for such Plan Year.  If during any Plan Year for which this Section 16.3
is applicable a defined benefit plan is included in the aggregation group and
such defined benefit plan is a top-heavy plan for such Plan Year, the
percentage set forth in clause (i) of the first sentence of this Section 16.3
shall be 5%.  The percentage referred to
in clause (ii) of the first sentence of this Section 16.3 shall be
obtained by dividing the aggregate of Employer contributions made pursuant to Article 4,
Article 5 and pursuant to any other defined contribution plan that is
required to be included in the aggregation group (other than a defined
contribution plan that enables a defined benefit plan that is required to be
included in such group to be qualified under section 401(a) of the
Code) during the Plan Year on behalf of such key employee by such key employee’s
compensation for the Plan Year. 
Notwithstanding the foregoing, the minimum contribution described in
this Section 16.3 for any Plan Year for which the Plan is a top-heavy plan
shall not be made under this Plan with respect to any Participant who receives
a minimum contribution or minimum benefit for purposes of section 416(c) of
the Code under another plan maintained by an Affiliate.

 

Section 16.4.          Minimum
Vesting for Top-Heavy Years. 
Notwithstanding any provision of the Plan to the contrary, for any Plan
Year for which the Plan is a top-heavy plan, a Participant or Rexall
Participant with at least two Years of Service but not more than three Years of
Service shall become 20% vested in his or her accounts under the Plan; a
participant with at least three Years of Service but not more than four Years
of Service shall become 40% vested in his or her Plan accounts; a participant
with at least four Years of Service but no more 

 

74

 

than five Years of
Service shall become 60% vested in his or her Plan accounts; a participant with
at least five Years of Service but no more than six Years of Service shall
become 80% vested in his or her Plan accounts; and a participant with six or
more Years of Service shall become 100% vested in his or her Plan
accounts.  Any portion of an ESOP Account
or Account that a participant is not entitled to receive pursuant to this Section shall
be charged to the relevant account and forfeited as of the earlier of (i) the
date the participant receives a distribution of his or her vested account and (ii) the
date the participant incurs five consecutive 1-Year Breaks in Service.

 

ARTICLE 17

 

AMENDMENT, ESTABLISHMENT OF

SEPARATE PLAN, AND PLAN TERMINATION

 

Section 17.1.          Amendment.  The Committee may, at any time and from time
to time, amend or modify the Plan.  Any
such amendment or modification shall become effective as of such date provided
therein upon its execution, including retroactively to the extent permitted by
law, and may apply to participants in the Plan at the time thereof as well as
to future participants.

 

Section 17.2.          Establishment
of Separate Plan.  If an Employer
terminates its participation in the Plan pursuant to Section 17.3, then
the Administrator shall determine the portion of each of the funds of the Trust
Fund that is applicable to the Participants, Rexall Participants and ESOP
Participants employed by such Employer and their Beneficiaries and direct the
Trustee to segregate such portion in a separate trust.  Such separate trust thereafter shall be held
and administered as a part of the separate plan of such Employer.

 

Section 17.3.          Termination.  The Company at any time may terminate the
Plan or any portion of the Plan by delivery to the Administrator of written
notice of such termination.  

 

75

 

An Employer at any
time may terminate its participation in the Plan by resolution of its board of
directors.  In the event of any such
termination, or in the event of the partial termination of the Plan with
respect to a group of Participants, Rexall Participants or ESOP Participants
(or any combination thereof), the Accounts and ESOP Accounts of the group with
respect to whom the Plan is terminated shall become fully vested and thereafter
shall not be subject to forfeiture. 
Unallocated amounts, including Forfeitures, shall be allocated to the
applicable Accounts and ESOP Accounts. 
The Administrator shall direct the Trustee to distribute the vested
Accounts and ESOP Accounts to such group.

 

A complete discontinuance of contributions by an
Employer to the Plan shall be deemed a termination of such Employer’s
participation in the Plan for purposes of this Section 17.3.

 

76

 

IN
WITNESS WHEREOF, the Company has caused this instrument to be executed by its
duly authorized officer this 1st day of December, 2005.

 

 

	
   

  	
   

  	
  NBTY, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Harvey Kamil

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President

  

 

77

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