GNC 2011 Annual Report Download - page 137

Table of Contents
Each annual incentive plan establishes thresholds, expressed as a percentage of the target amount or the maximum amount, based on the achievement of
certain financial performance goals. The target bonus is designed to provide Named Executive Officers with a normal target bonus if we perform to
expectation. The threshold bonus is designed to provide Named Executive Officers with some bonus opportunity, but less than the target opportunity if we do
not achieve our expected budgeted performance. If we exceed our budgeted performance, Named Executive Officers will be paid a maximum bonus in excess
of the target in order to reward them for our outstanding performance. For 2008, 2009 and 2010, the goal was based on budgeted EBITDA subject to certain
adjustments for non-recurring items as determined by our board of directors. In 2008, such adjustments included the exclusion of executive recruiting fee
expenses, consulting expenses and a vendor receivable write-off. In 2009 and 2010 there were no adjustments. In 2008, 2009 and 2010, we achieved 102.2%,
104.6% and 104.5%, respectively, of budgeted EBITDA.
The following table sets forth the thresholds and related goals with respect to the 2010 Incentive Plan, the 2009 Incentive Plan and the 2008 Incentive
Plan:
2010 Incentive Plan 2009 Incentive Plan 2008 Incentive Plan
Thresholds Budgeted EBITDA Budgeted EBITDA Budgeted EBITDA
First
threshold —
33.0% of
target 91.5% 95.0% 95.0%
Second
threshold —
66.0% of
target — — 97.0%
Target 100.0% 100.0% 100.0%
Maximum 103.9% 106.5% 108.0%
As in 2008, for the 2009 Incentive Plan, the payment amount for each plan participant, including our Named Executive Officers, was pro rated for
budgeted EBITDA achieved between the Target and Maximum levels.
Based on our financial performance in 2010, we achieved the Maximum EBITDA threshold set forth in the 2010 Incentive Plan. As a result, in March
2011, each of our executive officers participating in the 2010 Incentive Plan, including each of our Named Executive Officers, will be paid the maximum
annual incentive compensation under the 2010 Incentive Plan.
The annual incentive plan for 2011 performance (the "2011 Incentive Plan") was adopted by the Compensation Committee on February 3, 2011. The
2011 Incentive Plan provides for the same target and maximum bonus amounts for the Chief Executive Officer, President, Executive Vice Presidents and
Senior Vice Presidents as the 2010 Incentive Plan. In addition, the 2011 Incentive Plan's targets are based on budgeted EBITDA, subject to certain
adjustments for non-recurring items as determined by our board of directors. The thresholds and related goals with respect to the 2011 Incentive Plan are as
follows:
2011 Incentive Plan
Thresholds Budgeted EBITDA
First threshold — 33% of target 94.6%
Second threshold — 66% of target —
Target 100%
Maximum 103.7%
We do not disclose our internal budget for results of operations, including budgeted EBITDA (as determined by our board of directors). This amount
constitutes confidential financial information, and we believe that disclosure of this amount, whether with respect to historical periods or future
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