GNC 2010 Annual Report Download - page 7

Table of Contents
As a result of the Merger, GNC Acquisition Holdings Inc. became the sole equity holder of GNC Parent LLC and the ultimate parent
company of both GNC Corporation, our direct parent company, and us. The outstanding capital stock of GNC Acquisition Holdings Inc. is
beneficially owned by Ares Corporate Opportunities Fund II L.P. ("ACOF"), an affiliate of Ares Management LLC ("Ares") Ontario Teachers'
Pension Plan Board ("OTPP"), certain institutional investors, certain of our directors, and certain former stockholders of GNC Parent
Corporation, including members of our management. Refer to Note 1, "Nature of Business," and Item 12, "Security Ownership of Certain
Beneficial Owners and Management and Related Stockholders Matters," to our consolidated financial statements included in this report for
additional information.
Holdings and each of its stockholders is party to a stockholders agreement. Among other things, the stockholders agreement contains
certain restrictions on transfer of shares of Holdings' capital stock, and gives each of ACOF and OTPP the right to designate four members of
Holdings' board of directors (or, at the option of each, five members of the board of directors, one of which shall be independent) for so long as
they or their respective affiliates each own at least 10% of the outstanding common stock of Holdings. For additional information, see Item 13,
"Certain Relationships and Related Transactions and Director Independence- Stockholders' Agreement."
GNC Parent Corporation was formed as a Delaware corporation in November 2006 to acquire all the outstanding common stock of GNC
Corporation.
General Nutrition Centers, Inc. was formed in October 2003 and GNC Corporation was formed as a Delaware corporation in
November 2003 by Apollo Management V, L.P. ("Apollo"), an affiliate of Apollo Management V, L.P. and members of our management to
acquire General Nutrition Companies, Inc. from Numico USA, Inc., a wholly owned subsidiary of Koninklijke (Royal) Numico N.V. (collectively,
"Numico"). In December 2003, we purchased all of the outstanding equity interests of General Nutrition Companies, Inc.
General Nutrition Companies, Inc. was founded in 1935 by David Shakarian who opened its first health food store in Pittsburgh,
Pennsylvania. Since that time, the number of stores has continued to grow, and General Nutrition Companies, Inc. began producing its own
vitamin and mineral supplements as well as foods, beverages, and cosmetics. General Nutrition Companies, Inc. was acquired in August 1999
by Numico Investment Corp. and, prior to its acquisition, was a publicly traded company listed on the Nasdaq National Market.
Industry Overview
We operate within the large and growing U.S. nutritional supplements retail industry. According to Nutrition Business Journal's
Supplement Business Report 2009, our industry generated an estimated $25.2 billion in sales in 2008 and an estimated $26.6 billion in 2009,
and is projected to grow at an average annual rate of approximately 4% per year through 2017. Our industry is also highly fragmented, and we
believe this fragmentation provides large operators, like us, the ability to compete more effectively due to scale advantages.
We expect several key demographic, healthcare, and lifestyle trends to drive the continued growth of our industry. These trends include:
• Increased Focus on Healthy Living. Consumers are leading more active lifestyles and becoming increasingly focused on healthy
living, nutrition, and supplementation. According to the Nutrition Business Journal's Supplement Business Report 2009, 15% of the
U.S. adult population were regular or heavy users of vitamins in 2008, up from 13% in 2007. We believe that growth in the nutritional
supplements industry will continue to be driven by consumers who increasingly embrace health and wellness as a critical part of their
lifestyles. 2