GNC 2010 Annual Report Download - page 114

Table of Contents
GENERAL NUTRITION CENTERS, INC. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
In addition to the foregoing, the Company is subject to numerous federal, state, local, and foreign environmental and health and safety
laws and regulations governing its operations, including the handling, transportation, and disposal of the Company's non-hazardous and
hazardous substances and wastes, as well as emissions and discharges from its operations into the environment, including discharges to air,
surface water, and groundwater. Failure to comply with such laws and regulations could result in costs for remedial actions, penalties, or the
imposition of other liabilities. New laws, changes in existing laws or the interpretation thereof, or the development of new facts or changes in
their processes could also cause the Company to incur additional capital and operation expenditures to maintain compliance with environmental
laws and regulations and environmental permits. The Company also is subject to laws and regulations that impose liability and cleanup
responsibility for releases of hazardous substances into the environment without regard to fault or knowledge about the condition or action
causing the liability. Under certain of these laws and regulations, such liabilities can be imposed for cleanup of previously owned or operated
properties, or for properties to which substances or wastes that were sent in connection with current or former operations at its facilities. The
presence of contamination from such substances or wastes could also adversely affect the Company's ability to sell or lease its properties, or to
use them as collateral for financing. From time to time, the Company has incurred costs and obligations for correcting environmental and health
and safety noncompliance matters and for remediation at or relating to certain of its properties or properties at which its waste has been
disposed. The Company believes it has complied with, and is currently complying with, its environmental obligations pursuant to environmental
and health and safety laws and regulations and that any liabilities for noncompliance will not have a material adverse effect on its business or
financial performance. However, it is difficult to predict future liabilities and obligations, which could be material.
NOTE 17. STOCKHOLDER'S EQUITY
At December 31, 2009 there were 100 shares of Common Stock, par value $.01 per share, outstanding. All of our outstanding stock was
owned by GNC Corporation, our direct parent, at December 31, 2009.
The accumulated balances of other comprehensive income and their related tax effects included as part of the consolidated financial
statements are as follows:
Tax Benefit
Before tax amount (Expense) Net Other Comprehensive Income (Loss)
Unrealized Unrealized
Foreign Gain/(Loss) Unrealized Foreign Gain/(Loss)
currency on Gain/(Loss) on currency on
$ in thousands translation Derivatives Derivatives translation Derivatives Total
Balance at December 31, 2007 $ (852) $ — $ — $ (852) $ — $ (852)
Foreign currency translation adjustment (4,767) — — (4,767) — (4,767)
Unrealized loss on derivatives designated as cash flow hedge, net
of tax — (13,267) 4,829 — (8,438) (8,438)
Balance at December 31, 2008 (5,619) (13,267) 4,829 (5,619) (8,438) (14,057)
Foreign currency translation adjustment 4,172 — — 4,172 — 4,172
Unrealized gain on derivatives designated as cash flow hedge, net
of tax — 4,223 (1,537) — 2,686 2,686
Balance at December 31, 2009 $ (1,447) $ (9,044) $ 3,292 $ (1,447) $ (5,752) $ (7,199)
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