GNC 2010 Annual Report Download - page 157

Table of Contents
Employment Agreements with our 2009 Named Executive Officers
Chief Executive Officer
On March 16, 2007, we entered into an employment agreement with Mr. Fortunato that provides for a five-year term with automatic
annual one-year renewals thereafter unless we or Mr. Fortunato provide at least one-year advance notice of termination, and an annual base
salary of not less than $800,000, subject to certain upward adjustments. Effective January 1, 2009, Mr. Fortunato's employment agreement was
amended to comply with Code Section 409A. Effective January 1, 2010, the Compensation Committee granted Mr. Fortunato a merit-based
increase in his annual base salary to $886,000. The employment agreement provides for an annual performance bonus with a target bonus of
75% and a maximum bonus of 125% of Mr. Fortunato's annual base salary based upon our attainment of annual goals established by the
Company Board or the Compensation Committee. The employment agreement also provides that Mr. Fortunato will receive certain fringe
benefits and perquisites similar to those provided to our other executive officers. The employment agreement provides that upon a change in
control all of Mr. Fortunato's stock options will fully vest and become immediately exercisable and all restrictions with respect to restricted stock,
if any, granted to Mr. Fortunato will lapse.
Upon Mr. Fortunato's termination for death or total disability we will be required to pay to him (or his guardian or personal representative):
• a lump sum equal to one times his base salary plus the annualized value of his perquisites; and
• a prorated share of the annual bonus he would have received had he worked the full year, provided bonus targets are met for
such year.
We will also pay the monthly cost of COBRA coverage for Mr. Fortunato to the same extent we paid for such coverage prior to the termination
date for the period permitted by COBRA or, in the case of disability, until Mr. Fortunato obtains other employment offering substantially similar
or improved group health benefits. In addition, Mr. Fortunato's outstanding stock options will vest and restrictions on restricted stock awards will
lapse as of the date of termination, in each case, assuming he had continued employment during the calendar year in which termination occurs
and for the year following such termination.
If Mr. Fortunato's employment is terminated without cause, he resigns for good reason or we decline to renew the employment term for
reasons other than those that would constitute cause after the initial five-year employment term, then, subject to Mr. Fortunato's execution of a
release:
• Mr. Fortunato will receive payment of a lump sum amount of two times his base salary and the annualized value of his
perquisites;
• Mr. Fortunato will receive payment of a lump sum amount of two times his average annual bonus paid or payable with respect
to the most recent three fiscal years;
• we will pay the monthly cost of COBRA coverage for Mr. Fortunato to the same extent we paid for such coverage prior to the
termination date for the period permitted by COBRA or until Mr. Fortunato obtains other employment offering substantially
similar or improved group health benefits; and
• Mr. Fortunato's outstanding stock options will vest and restrictions on restricted stock awards will lapse if they would have
otherwise done so in the 24 months following the termination had Mr. Fortunato continued to be employed (36 months if such
termination occurs in anticipation of a change in control, or within the six months prior to, or at any time following, an initial
public offering of our Parent's common stock). 151