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TABLE OF CONTENTS
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Table of Contents

As filed with the Securities and Exchange Commission on February 10, 2011.

Registration Statement No. 333-169618

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



AMENDMENT NO. 2
TO
Form S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933



GNC Acquisition Holdings Inc.

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)
  5400
(Primary Standard Industrial
Classification Code Number)
  20-8536244
(I.R.S. Employer
Identification Number)

300 Sixth Avenue
Pittsburgh, Pennsylvania 15222
(412) 288-4600
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)

Gerald J. Stubenhofer, Jr.
Senior Vice President, Chief Legal Officer and Secretary
GNC Acquisition Holdings Inc.
300 Sixth Avenue
Pittsburgh, Pennsylvania 15222
(412) 288-4600
(Name, address, including zip code, and telephone number, including area code, of agent for service)



Copies of all communications to:

Philippa M. Bond, Esq.

 

Robert E. Buckholz, Jr., Esq.
Proskauer Rose LLP   Sullivan & Cromwell LLP
2049 Century Park East, Suite 3200   125 Broad Street
Los Angeles, California 90067   New York, New York 10004
(310) 557-2900/(310) 557-2193 (Facsimile)   (212) 558-4000/(212) 558-3588 (Facsimile)



            Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement.



            If the securities being registered on this Form are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.    o

            If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

            If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

            If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

            Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of "large accelerated filer", "accelerated filer", and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o   Accelerated filer o   Non-accelerated filer ý
(Do not check if a
smaller reporting company)
  Smaller reporting company o



            The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Commission, acting pursuant to Section 8(a), may determine.


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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to Completion, Dated February 10, 2011

PROSPECTUS

                       Shares

GNC Holdings, Inc.

Class A Common Stock

          This is an initial public offering of Class A common stock of GNC Holdings, Inc. (formerly GNC Acquisition Holdings Inc.).

          We are selling                          shares and                          shares are being sold by certain of our stockholders, some of whom are our affiliates. We will not receive any proceeds from the sale of our Class A common stock by the selling stockholders.

          No public market currently exists for our Class A common stock. We will apply to list our Class A common stock on the New York Stock Exchange under the symbol "GNC". We anticipate that the initial public offering price of our Class A common stock will be between $             and $             per share.

          Investing in our Class A common stock involves risk. See "Risk Factors" beginning on page 14 of this prospectus.

 
Per Share
 
Total
 

Public offering price

  $   $  

Underwriting discount and commissions

  $   $  

Proceeds, before expenses, to GNC Holdings, Inc. 

  $   $  

Proceeds, before expenses, to the selling stockholders

  $   $  

          The selling stockholders have granted the underwriters a 30-day option to purchase up to                          additional shares of Class A common stock at the public offering price, less the underwriting discount. We will not receive any proceeds from the exercise of the option to purchase additional shares.

          Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

          Delivery of the shares of Class A common stock will be made on or about                          , 2011.

Goldman, Sachs & Co.   J.P. Morgan
Deutsche Bank Securities   Morgan Stanley

The date of this prospectus is                          , 2011.


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GRAPHIC


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TABLE OF CONTENTS

 
 
Page

Prospectus Summary

  1

Risk Factors

  14

Special Note Regarding Forward-Looking Statements

  35

Use of Proceeds

  37

Dividend Policy

  37

Capitalization

  38

Dilution

  39

Selected Consolidated Financial Data

  40

Management's Discussion and Analysis of Financial Condition and Results of Operations

  43

Business

  69

Management

  99

Executive Compensation

  107

Principal and Selling Stockholders

  136

Certain Relationships and Related Transactions

  140

Description of Capital Stock

  145

Description of Certain Debt

  151

Shares Eligible for Future Sale

  154

Material United States Federal Tax Consequences to Non-United States Stockholders

  156

Underwriting

  159

Legal Matters

  165

Experts

  165

Where You Can Find More Information

  166

Index to Consolidated Financial Statements

  F-1



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PROSPECTUS SUMMARY

          This summary highlights the information contained in this prospectus. Because this is only a summary, it does not contain all of the information that may be important to you. For a more complete understanding of the information that you may consider important in making your investment decision, we encourage you to read this entire prospectus. Before making an investment decision, you should carefully consider the information under the heading "Risk Factors" and our consolidated financial statements and their notes in this prospectus. Prior to the consummation of this offering, GNC Acquisition Holdings Inc. will be renamed GNC Holdings, Inc. Unless the context requires otherwise, "we", "us", "our", and "GNC" refer to GNC Holdings, Inc. and its subsidiaries and, for periods prior to March 16, 2007, our predecessor. See "Business — Corporate History". References to "our stores" refer to our company-owned stores and our franchise stores. References to "our locations" refer to our stores and our "store-within-a-store" locations at Rite Aid.

Our Company

          Based on our worldwide network of more than 7,100 locations and our GNC.com website, we believe we are the leading global specialty retailer of health and wellness products, including vitamins, minerals and herbal supplements ("VMHS") products, sports nutrition products and diet products. Our diversified, multi-channel business model derives revenue from product sales through domestic company-owned retail stores, domestic and international franchise activities, third-party contract manufacturing, e-commerce and corporate partnerships. We believe that the strength of our GNC brand, which is distinctively associated with health and wellness, combined with our stores and website, give us broad access to consumers and uniquely position us to benefit from the favorable trends driving growth in the nutritional supplements industry and the broader health and wellness sector. Our broad and deep product mix, which is focused on high-margin, premium, value-added nutritional products, is sold under our GNC proprietary brands, including Mega Men®, Ultra Mega®, GNC WELLbeING®, Pro Performance® and Pro Performance® AMP, and under nationally recognized third-party brands.

          Based on the information we compiled from the public securities filings of our primary competitors, our network of domestic retail locations is approximately twelve times larger than the next largest U.S. specialty retailer of nutritional supplements and provides a leading platform for our vendors to distribute their products to their target consumer. Our close relationship with our vendor partners has enabled us to negotiate first-to-market opportunities. In addition, our in-house product development capabilities enable us to offer our customers proprietary merchandise that can only be purchased through our locations or on our website. Since the nutritional supplement consumer often requires knowledgeable customer service, we also differentiate ourselves from mass and drug retailers with our well-trained sales associates who are aided by in-store technology. We believe that our expansive retail network, differentiated merchandise offering and quality customer service result in a unique shopping experience that is distinct from our competitors.

Recent Transformation of GNC

          Beginning in 2006, we executed a series of strategic initiatives to enhance our existing business and growth profile. Specifically, we:

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Industry Overview

          We operate within the large and growing U.S. nutritional supplements industry. According to Nutrition Business Journal's Supplement Business Report 2010, our industry generated $26.9 billion in sales in 2009 and an estimated $28.7 billion in 2010, and is projected to grow at an average annual rate of approximately 5.3% through 2015. Our industry is 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:

Competitive Strengths

          We believe we are well-positioned to capitalize on favorable industry trends as a result of the following competitive strengths:

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          As a result of our competitive strengths, we have maintained consistent earnings growth through the recent economic cycle. The third quarter of 2010 marked the 21st consecutive quarter of positive domestic company-owned same store sales growth. This consistent growth in company-owned retail sales, the positive operating leverage generated by our retail operations, cost containment initiatives, as well as growth in our other channels of distribution, have allowed us to expand our EBITDA margin by 470 basis points since 2005.

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Our Growth Strategy

          We plan to execute several strategies in the future to promote growth in revenue and operating income, and capture market share, including:

The Sponsors

          Currently, Ares Corporate Opportunities Fund II, L.P. ("Ares"), Ontario Teachers' Pension Plan Board ("OTPP") and members of management hold substantially all of our outstanding common stock. Ares and OTPP are collectively referred to in this prospectus as the "Sponsors". After giving effect to this offering, the Sponsors will hold              shares of our Class A common stock, representing approximately         % of our outstanding Class A common stock, and OTPP will hold              shares of our Class B common stock, representing 100% of our outstanding Class B common stock, and the Sponsors will have the power to control our affairs and policies, including

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with respect to the election of directors (and through the election of directors the appointment of management), the entering into of mergers, sales of substantially all of our assets and other significant transactions. The Class A common stock and Class B common stock vote together as a single class on all matters and are substantially identical in all respects, including with respect to voting, dividends and conversion, except that the Class B common stock does not entitle its holder to vote for the election or removal of directors. In addition, a holder of Class B common stock may, at any time, elect to convert shares of Class B common stock into an equal number of shares of Class A common stock or, under certain circumstances, convert shares of Class A common stock into an equal number of shares of Class B common stock.

          All of our current directors were designated by the Sponsors and elected pursuant to the existing amended and restated stockholders agreement, which requires each of Ares and OTPP to vote all the shares of Class A common stock held by them in favor of the directors designated by each of them. Under a new stockholders agreement to be entered into among the Sponsors and us (the "New Stockholders Agreement"), effective upon completion of this offering, the Sponsors will have the right to nominate to our board of directors, subject to their election by our stockholders, for so long as the Sponsors collectively own more than 50% of the then outstanding shares of our common stock, the greater of up to nine directors and the number of directors comprising a majority of our board and, subject to certain exceptions, for so long as the Sponsors collectively own 50% or less of the then outstanding shares of our common stock, that number of directors (rounded up to the nearest whole number or, if such rounding would cause the Sponsors to have the right to elect a majority of our board of directors, rounded to the nearest whole number) that is the same percentage of the total number of directors comprising our board as the collective percentage of common stock owned by the Sponsors. Under the New Stockholders Agreement, each Sponsor will also agree to vote in favor of the other Sponsor's nominees. Because our board of directors will be divided into three staggered classes, the Sponsors may be able to influence or control our affairs and policies even after they cease to collectively own a majority of our then outstanding common stock during the period in which the Sponsors' designated directors finish their terms as members of our board. The New Stockholders Agreement will also provide that, so long as the Sponsors collectively own more than one-third of our outstanding common stock, certain significant corporate actions will require the approval of at least one of the Sponsors. See "Certain Relationships and Related Transactions — Stockholders Agreements".

          Pursuant to the ACOF Management Services Agreement described under the heading "Certain Relationships and Related Transactions — ACOF Management Services Agreement", upon consummation of this offering, we intend to terminate the agreement by paying ACOF Operating Manager II, L.P. (an affiliate of Ares) a fee equal to the net present value of the aggregate annual management fee that would have been payable to ACOF Operating Manager II during the remainder of the term of the fee agreement. Pursuant to the obligations under our Class B common stock, as described under the heading "Certain Relationships and Related Transactions — Special Dividend", OTPP will receive, in lieu of quarterly special dividend payments that would have been payable during the remainder of the Special Dividend Period (as defined below), an automatic payment in the amount equal to the net present value of the aggregate annual special dividend amount that would have been payable to OTPP. We estimate that our aggregate payment to ACOF Operating Manager II and OTPP would have been $            million and $            million, respectively, had the offering occurred on                      .

          In connection with the consummation of this offering, OTPP will convert                          shares of Class B common stock into an equal number of shares of Class A common stock. As a result of such conversion and after giving effect to this offering, OTPP will hold                          shares of our Class A common stock representing approximately         % of our outstanding Class A common

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stock and will hold                          shares of our Class B common stock representing 100% of our outstanding Class B common stock.

          Together with our wholly owned subsidiary, GNC Acquisition Inc., we entered into an Agreement and Plan of Merger (the "Merger Agreement") with GNC Parent Corporation on February 8, 2007. Pursuant to the Merger Agreement and on March 16, 2007, GNC Acquisition Inc. was merged with and into GNC Parent Corporation, with GNC Parent Corporation as the surviving corporation and our wholly owned subsidiary (the "Merger"). In connection with the Merger, the Sponsors made equity contributions in GNC Parent Corporation in exchange for all of their shares of our common stock that they currently own.

Payments in Connection with This Offering

          The table below sets forth information concerning the payments that will be made to the Sponsors and our directors and executive officers in connection with this offering.

 
 
Payments in
connection with
redemption of
Series A
preferred stock
 
Payments in connection
with the ACOF
Management Services
Agreement and the
Special Dividend
 
Proceeds from
the sale of
Class A
common stock
 
 
  (in thousands)
 

Directors and Executive Officers:

                   

Norman Axelrod

                 

Andrew Claerhout

                 

Thomas Dowd

                 

Carmen Fortino

                 

Joseph Fortunato

                 

Michael Hines

                 

Beth J. Kaplan

                 

David B. Kaplan

                 

Romeo Leemrijse

                 

Michael M. Nuzzo

                 

Brian Klos

                 

Gerald J. Stubenhofer

                 

Richard J. Wallace

                 

Sponsors:

                   

Ares

                   

OTPP

                   

Risks Related to Our Business and Strategy

          Despite the competitive strengths described above, our ability to successfully operate our business is subject to numerous risks, including those that are generally associated with operating in the nutritional supplements industry. Any of the factors set forth under "Risk Factors" may limit our ability to successfully execute our business strategy. You should carefully consider all of the information set forth in this prospectus and, in particular, you should evaluate the specific factors set forth under "Risk Factors" in deciding whether to invest in our Class A common stock. Risks relating to our business and our ability to execute our business strategy include:

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Corporate Information

          We are a Delaware corporation. Our principal executive office is located at 300 Sixth Avenue, Pittsburgh, Pennsylvania 15222, and our telephone number is (412) 288-4600. We also maintain a website at GNC.com. The information contained on, or that can be accessed through, our website is not part of, and is not incorporated into, this prospectus. We own or have rights to trademarks or trade names that we use in conjunction with the operation of our business. Our service marks and trademarks include the GNC® name. Each trademark, trade name, or service mark of any other company appearing in this prospectus belongs to its holder. Use or display by us of other parties' trademarks, trade names, or service marks is not intended to and does not imply a relationship with, or endorsement or sponsorship by us of, the trademark, trade name, or service mark owner.



          We have not authorized anyone to provide any information or make any representations other than the information and representations in this prospectus or any free writing prospectus that we have authorized to be delivered to you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is not an offer to sell or a solicitation of an offer to buy shares in any jurisdiction where an offer or sale of shares would be unlawful. The information in this prospectus is complete and accurate only as of the date on the front cover regardless of the time of delivery of this prospectus or of any sale of shares of our Class A common stock.




Market & Industry Information

          Throughout this prospectus, we use market data and industry forecasts and projections that were obtained from surveys and studies conducted by third parties, including the Nutrition Business Journal, Beanstalk Marketing and LJS & Associates, and The Buxton Company, and from publicly available industry and general publications. Although we believe that the sources are reliable, we have not independently verified the information contained therein. We note that estimates, in particular as they relate to general expectations concerning our industry, involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading "Risk Factors" in this prospectus.

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The Offering

Class A common stock offered by us

                            shares

  

   

Class A common stock offered by the selling stockholders, some of whom are our affiliates

                            shares

  

   

Underwriters' option to purchase additional shares of Class A common stock from the selling stockholders in this offering

                            shares

  

   

Class A common stock outstanding after this offering

                            shares

  

   

Class B common stock outstanding after this offering

                            shares

  

   

Voting rights

  Each share of our Class A common stock entitles its holder to one vote per share on all matters to be voted upon by our stockholders. Each share of our Class B common stock entitles its holder to one vote per share on all matters to be voted upon by our stockholders, except with respect to the election or removal of directors on which the holders of shares of our Class B common stock are not entitled to vote. As discussed above under "— The Sponsors", Ares and OTPP will be parties to the New Stockholders Agreement pursuant to which they will have the ability to initially appoint all of the directors to our board.

  

   

Conversion rights

  The shares of Class A common stock are convertible into shares of Class B common stock, in whole or in part, at any time and from time to time at the option of the holder so long as such holder holds Class B common stock, on the basis of one share of Class B common stock for each share of Class A common stock that it wishes to convert. The shares of Class B common stock are convertible into shares of Class A common stock, in whole or in part, at any time and from time to time at the option of the holder, on the basis of one share of Class A common stock for each share of Class B common stock that it wishes to convert.

  

   

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Use of proceeds

  We estimate that the net proceeds to us from this offering will be approximately $            million (based on the midpoint of the price range set forth on the front cover of this prospectus), after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use the net proceeds to us, together with cash on hand, to redeem all of our outstanding Series A preferred stock immediately following completion of this offering and to pay related expenses. Any remaining net proceeds to us will be used for working capital and general corporate purposes. We will not receive any proceeds from the sale of any shares of Class A common stock by the selling stockholders. See "Use of Proceeds".

  

   

Dividend Policy

  Although the holders of our common stock will be entitled to receive dividends when and as declared by our board of directors from legally available sources, subject to the prior rights of the holders of our preferred stock, if any, we do not anticipate paying any dividends on our common stock in the foreseeable future. See "Dividend Policy." Any future determination relating to dividend policy will be made at the discretion of our board of directors and will depend on a number of factors, including restrictions in our debt instruments, our future earnings, capital requirements, financial condition, future prospects, and applicable Delaware law, which provides that dividends are only payable out of surplus or current net profits.

  

   

Proposed New York Stock Exchange trading symbol

  "GNC"

  

   

Risk factors

  For a discussion of risks relating to our business and an investment in our Class A common stock, see "Risk Factors" beginning on page 14.

          The number of shares of Class A common stock to be outstanding after completion of this offering is based on                          shares of our Class A common stock to be sold in this offering and, except where we state otherwise, the Class A common stock information we present in this prospectus:

          Unless we specifically state otherwise, the information in this prospectus does not take into account the sale of up to                          shares of our Class A common stock that the underwriters have the option to purchase from the selling stockholders.

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Summary Consolidated Financial Data

          The summary consolidated financial data presented below for the years ended December 31, 2009 and 2008 and for the period March 16 to December 31, 2007 (collectively, the "Successor Periods"), and for the period January 1, 2007 to March 15, 2007 (the "Predecessor Period") are derived from our audited consolidated financial statements and footnotes included in this prospectus. The summary consolidated financial data for the period from January 1, 2007 to March 15, 2007 represents the period during which GNC Parent Corporation was owned by an investment fund managed by Apollo Management V, L.P. ("Apollo").

          The summary consolidated financial data presented below for the nine months ended September 30, 2009 and 2010 are derived from our unaudited consolidated financial statements and accompanying notes included in this prospectus and include, in the opinion of management, all adjustments, consisting only of normal recurring adjustments, for a fair statement of our financial position and operating results as of and for the nine months ended September 30, 2009 and 2010.

          The summary consolidated financial data is presented on an actual basis for and as of the periods indicated and on an as adjusted basis giving effect to 1) the completion of this offering, 2) the application of the estimated net proceeds from this offering, as described under "Use of Proceeds", including the redemption of all outstanding shares of our Series A preferred stock immediately following completion of this offering, 3) prior to the consummation of this offering, the conversion of                    shares of Class B common stock into                     shares of Class A common stock, and 4) our use of cash on hand to satisfy our obligations under the ACOF Management Services Agreement and our Class B common stock (see "Certain Relationships and Related Transactions — ACOF Management Services Agreement" and "— Special Dividend").

          Our results for interim periods are not necessarily indicative of our results for a full year of operations. The following summary consolidated financial data should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and footnotes included elsewhere in this prospectus.

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  Successor    
  Predecessor  
 
 
Nine Months
Ended
September 30,
2010
 
Nine Months
Ended
September 30,
2009
 
Year Ended
December 31,
2009
 
Year Ended
December 31,
2008
 
March 16-
December 31,
2007
   
 
January 1-
March 15,
2007
 
 
  (Unaudited)
   
   
   
   
   
 
 
   
  (dollars in millions, except share data and as noted)
   
   
 

Statement of Income Data:

                                         

Total revenues

  $ 1,386.4   $ 1,303.1   $ 1,707.0   $ 1,656.7   $ 1,223.0       $ 329.8  

Gross profit

    492.6     453.9     590.6     574.1     408.8         117.6  

Operating income (loss)

    172.3     143.3     181.0     169.6     106.9         (19.2 )

Interest expense, net

    49.2     53.0     69.9     83.0     75.5         72.8  

Net income (loss)

    77.7     56.9     69.5     54.6     18.8         (70.4 )

Earnings (loss) per share(1):

                                         
   

Basic

  $ 0.72   $ 0.49   $ 0.58   $ 0.43   $ 0.08       $ (1.39 )
   

Diluted

  $ 0.70   $ 0.49   $ 0.58   $ 0.43   $ 0.08       $ (1.39 )

Other Data:

                                         

Net cash provided by (used in) operating activities

    97.6     77.8     114.0     77.4     92.0         (67.5 )

Net cash used in investing activities

    (21.2 )   (22.0 )   (42.2 )   (60.4 )   (1,672.2 )       (6.2 )

Net cash provided by (used in) financing activities

    (1.1 )   (21.1 )   (26.4 )   (1.4 )   1,598.7         58.7  

EBITDA(2)

    206.1     177.9     227.7     212.1     136.9         (11.8 )

Capital expenditures(3)

    21.0     20.4     28.7     48.7     28.9         5.7  

Number of Stores (at end of period):

                                         
 

Company-owned stores(4)

    2,871     2,806     2,832     2,774     2,745         2,699  
 

Franchise stores(4)

    2,298     2,176     2,216     2,144     2,056         2,018  
 

Store-within-a-store franchise locations(4)

    1,983     1,814     1,869     1,712     1,358         1,266  

Same Store Sales Growth:(5)

                                         
 

Domestic company-owned, including web

    5.5 %   3.3 %   2.8 %   2.7 %   1.7 %       0.1 %
 

Domestic franchise

    3.2 %   1.0 %   0.9 %   0.7 %   (1.2 )%       (4.1 )%

Average revenue per domestic company-owned store (dollars in thousands)

  $ 341.2   $ 327.7   $ 422.4   $ 418.1   $ 316.9       $ 93.3  

 

 
  As Adjusted  
 
 
Nine Months
Ended
September 30,
2010
 
Nine Months
Ended
September 30,
2009
 
Year Ended
December 31,
2009
 
 
  (Unaudited)
   
 

Income (loss) Per Share — Basic & Diluted (in thousands):

                   

Net income (loss)

                   

Preferred stock dividends

                   
               

Net income available to common stockholders

                   
               

Earnings (loss) per share:

                   
 

Basic

                   
 

Diluted

                   

Weighted average common shares outstanding (in thousands):

                   
 

Basic

                   
 

Diluted

                   

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  As of September 30, 2010  
 
 
Actual
 
As Adjusted
 
 
  (Unaudited)
 
 
  (Dollars in millions)
 

Balance Sheet Data:

             

Cash and cash equivalents

  $ 165.2        

Working capital(6)

    489.0        

Total assets

    2,407.2        

Total current and non-current long-term debt

    1,058.8        

Preferred stock

    213.0        

Total stockholders' equity

    815.2        

(1)
Includes impact of dividends on our Series A preferred stock.

(2)
We define EBITDA as net income before interest expense (net), income tax expense, depreciation and amortization. Management uses EBITDA as a tool to measure operating performance of the business. EBITDA is not a measurement of our financial performance under U.S. GAAP and should not be considered as an alternative to net income, operating income, or any other performance measures derived in accordance with U.S. GAAP, or as an alternative to U.S. GAAP cash flow from operating activities, as a measure of our profitability or liquidity.

The following table reconciles EBITDA to net income (loss) as determined in accordance with GAAP for the periods indicated:

 
   
   
   
   
   
   
   
 
 
  Successor    
  Predecessor  
 
 
Nine Months
Ended
September 30,
2010
 
Nine Months
Ended
September 30,
2009
 
Year Ended
December 31,
2009
 
Year Ended
December 31,
2008
 
March 16-
December 31,
2007
   
 
January 1-
March 15,
2007
 
 
  (Unaudited)
   
   
   
   
   
 
 
   
  (dollars in millions)
   
   
 

Net income (loss)

  $ 77.7   $ 56.9   $ 69.5   $ 54.6   $ 18.8       $ (70.4 )

Interest expense, net

    49.2     53.0     69.9     83.0     75.5         72.8  

Income tax expense (benefit)

    45.4     33.4     41.6     32.0     12.6         (21.6 )

Depreciation and amortization

    33.8     34.6     46.7     42.5     30.0         7.4  
                               

EBITDA

  $ 206.1 (a) $ 177.9 (b) $ 227.7 (b) $ 212.1 (b) $ 136.9 (b)     $ (11.8) (c)
                               

(a)
For the nine month period ended September 30, 2010, EBITDA includes the following expenses: $4.1 million of start-up costs related to our partnerships with PetSmart and PepsiCo and our operations in China and $1.1 million related to payments to the Sponsors under the management agreement and Class B common stock, which payments will cease following this offering.

(b)
For the nine month period ended September 30, 2009, the years ended December 31, 2009 and December 31, 2008, and the 2007 Successor Period, EBITDA includes $1.1 million, $1.5 million, $1.5 million and $1.2 million, respectively, related to payments to the Sponsors under the management agreement and Class B common stock, which payments will cease following this offering.

(c)
For the period January 1, 2007 to March 15, 2007, EBITDA includes $34.6 million of Merger related costs and $0.4 million related to payments to our prior sponsors for management fees.
(3)
Capital expenditures for the year ended December 31, 2008 includes approximately $10.1 million incurred in conjunction with our store register upgrade program.

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(4)
The following table summarizes our locations for the periods indicated:

 
   
   
   
   
   
   
   
 
 
  Successor    
  Predecessor  
 
 
Nine Months
Ended
September 30,
2010
 
Nine Months
Ended
September 30,
2009
 
Year Ended
December 31,
2009
 
Year Ended
December 31,
2008
 
March 16-
December 31,
2007
   
 
January 1-
March 15,
2007
 
 
  (Unaudited)
   
   
   
   
   
 

Company-Owned Stores

                                         

Beginning of period

    2,832     2,774     2,774     2,745     2,699         2,688  

Store openings

    57     27     45     71     64         18  

Franchise conversions(a)

    16     37     53     33     44         17  

Store closings(b)

    (34 )   (32 )   (40 )   (75 )   (62 )       (24 )
                               

End of period balance

    2,871     2,806     2,832     2,774     2,745         2,699  
                               

Franchise Stores

                                         
 

Domestic

                                         

Beginning of period

    909     954     954     978     1,022         1,046  

Store openings(b)

    25     19     31     41     16         4  

Store closings(c)

    (37 )   (54 )   (76 )   (65 )   (60 )       (28 )
                               

End of period balance

    897     919     909     954     978         1,022  
                               

International

                                         

Beginning of period

    1,307     1,190     1,190     1,078     996         961  

Store openings

    165     104     187     198     115         44  

Store closings

    (71 )   (37 )   (70 )   (86 )   (33 )       (9 )
                               

End of period balance

    1,401     1,257     1,307     1,190     1,078         996  
                               

Store-within-a-Store (Rite Aid)

                                         

Beginning of period

    1,869     1,712     1,712     1,358     1,266         1,227  

Store openings

    127     122     177     401     101         39  

Store closings

    (13 )   (20 )   (20 )   (47 )   (9 )        
                               

End of period balance

    1,983     1,814     1,869     1,712     1,358         1,266  
                               

Total stores

    7,152     6,796     6,917     6,630     6,159         5,983  
                               

(a)
Stores that were acquired from franchisees and subsequently converted into company-owned stores.

(b)
Includes corporate store locations acquired by franchisees.

(c)
Includes franchise stores closed and acquired by us.
(5)
Same store sales growth reflects the percentage change in same store sales in the period presented compared to the prior year period. Same store sales are calculated on a daily basis for each store and exclude the net sales of a store for any period if the store was not open during the same period of the prior year. Beginning in the first quarter of 2006, we also included our internet sales, as generated through www.GNC.com and www.drugstore.com, in our domestic company-owned same store sales calculation. When a store's square footage has been changed as a result of reconfiguration or relocation in the same mall or shopping center, the store continues to be treated as a same store. If, during the period presented, a store was closed, relocated to a different mall or shopping center, or converted to a franchise store or a company-owned store, sales from that store up to and including the closing day or the day immediately preceding the relocation or conversion are included as same store sales as long as the store was open during the same period of the prior year. We exclude from the calculation sales during the period presented that occurred on or after the date of relocation to a different mall or shopping center or the date of a conversion.

(6)
Working capital represents current assets less current liabilities.

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RISK FACTORS

          You should carefully consider the risks described below and all other information contained in this prospectus before making an investment decision. If any of the following risks actually occur, our business, financial condition and results of operations could be materially and adversely affected. In that event, the trading price of our Class A common stock could decline, and you may lose part or all of your investment.

Risks Relating to Our Business and Industry

We may not effectively manage our growth, which could materially harm our business.

          We expect that our business will continue to grow, which may place a significant strain on our management, personnel, systems and resources. We must continue to improve our operational and financial systems and managerial controls and procedures, and we will need to continue to expand, train and manage our technology and workforce. We must also maintain close coordination among our technology, compliance, accounting, finance, marketing and sales organizations. We cannot assure you that we will manage our growth effectively. If we fail to do so, our business could be materially harmed.

          Our continued growth will require an increased investment by us in technology, facilities, personnel, and financial and management systems and controls. It also will require expansion of our procedures for monitoring and assuring our compliance with applicable regulations, and we will need to integrate, train and manage a growing employee base. The expansion of our existing businesses, any expansion into new businesses and the resulting growth of our employee base will increase our need for internal audit and monitoring processes that are more extensive and broader in scope than those we have historically required. We may not be successful in identifying or implementing all of the processes that are necessary. Further, unless our growth results in an increase in our revenues that is proportionate to the increase in our costs associated with this growth, our operating margins and profitability will be adversely affected.

We operate in a highly competitive industry. Our failure to compete effectively could adversely affect our market share, revenues, and growth prospects.

          The U.S. nutritional supplements retail industry is large and highly fragmented. Participants include specialty retailers, supermarkets, drugstores, mass merchants, multi-level marketing organizations, on-line merchants, mail-order companies and a variety of other smaller participants. We believe that the market is also highly sensitive to the introduction of new products, which may rapidly capture a significant share of the market. In the United States, we also compete for sales with heavily advertised national brands manufactured by large pharmaceutical and food companies, as well as other retailers. In addition, as some products become more mainstream, we experience increased price competition for those products as more participants enter the market. Our international competitors include large international pharmacy chains, major international supermarket chains, and other large U.S.-based companies with international operations. Our wholesale and manufacturing operations compete with other wholesalers and manufacturers of third-party nutritional supplements. We may not be able to compete effectively and our attempt to do so may require us to reduce our prices, which may result in lower margins. Failure to effectively compete could adversely affect our market share, revenues, and growth prospects.

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Unfavorable publicity or consumer perception of our products and any similar products distributed by other companies could cause fluctuations in our operating results and could have a material adverse effect on our reputation, the demand for our products, and our ability to generate revenues.

          We are highly dependent upon consumer perception of the safety and quality of our products, as well as similar products distributed by other companies. Consumer perception of products can be significantly influenced by scientific research or findings, national media attention, and other publicity about product use. A product may be received favorably, resulting in high sales associated with that product that may not be sustainable as consumer preferences change. Future scientific research or publicity could be unfavorable to our industry or any of our particular products and may not be consistent with earlier favorable research or publicity. A future research report or publicity that is perceived by our consumers as less favorable or that questions earlier research or publicity could have a material adverse effect on our ability to generate revenues. For example, sales of some of our products, such as those containing ephedra, were initially strong, but decreased as a result of negative publicity and an ultimate ban of such products by the Food and Drug Administration (the "FDA"). As such, period-to-period comparisons of our results should not be relied upon as a measure of our future performance. Adverse publicity in the form of published scientific research or otherwise, whether or not accurate, that associates consumption of our products or any other similar products with illness or other adverse effects, that questions the benefits of our or similar products, or that claims that such products are ineffective could have a material adverse effect on our reputation, the demand for our products, and our ability to generate revenues.

Our failure to appropriately respond to changing consumer preferences and demand for new products could significantly harm our customer relationships and product sales.

          Our business is particularly subject to changing consumer trends and preferences. Our continued success depends in part on our ability to anticipate and respond to these changes, and we may not be able to respond in a timely or commercially appropriate manner to these changes. If we are unable to do so, our customer relationships and product sales could be harmed significantly.

          Furthermore, the nutritional supplements industry is characterized by rapid and frequent changes in demand for products and new product introductions. Our failure to accurately predict these trends could negatively impact consumer opinion of our stores as a source for the latest products. This could harm our customer relationships and cause losses to our market share. The success of our new product offerings depends upon a number of factors, including our ability to accurately anticipate customer needs; innovate and develop new products; successfully commercialize new products in a timely manner; price our products competitively; manufacture and deliver our products in sufficient volumes and in a timely manner; and differentiate our product offerings from those of our competitors.

          If we do not introduce new products or make enhancements to meet the changing needs of our customers in a timely manner, some of our products could become obsolete, which could have a material adverse effect on our revenues and operating results.

Our substantial debt could adversely affect our results of operations and financial condition and otherwise adversely impact our operating income and growth prospects.

          As of September 30, 2010, our total consolidated long-term debt (including current portion) was approximately $1,058.8 million, and we had an additional $44.7 million available under the $60.0 million senior revolving credit facility (the "Revolving Credit Facility") of General Nutrition

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Centers, Inc. ("Centers") after giving effect to $9.0 million utilized to secure letters of credit and a $6.3 million commitment from subsidiaries of Lehman Brothers Holdings Inc. (collectively, "Lehman"). In September 2008, Lehman filed for bankruptcy and we do not expect that Lehman will fund its pro rata share of the borrowing as required under the facility. If other financial institutions that have extended credit commitments to us are adversely affected by the condition of the U.S. and international capital markets, they may become unable to fund borrowings under the Revolving Credit Facility, which could have a material and adverse impact on our financial condition and our ability to borrow additional funds, if needed, for working capital, capital expenditures, acquisitions, and other corporate purposes.

          All of the debt under our senior credit facility, consisting of a $675.0 million term loan facility (the "Term Loan Facility") and the Revolving Credit Facility (together with the Term Loan Facility, the "Senior Credit Facility"), bears interest at variable rates. Our unhedged debt is subject to additional interest expense if these rates increase significantly, which could also reduce our ability to borrow additional funds.

          Our substantial debt could have material consequences on our financial condition. For example, it could:

          For additional information regarding the interest rates and maturity dates of our existing debt, see "Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources".

          We and our subsidiaries may be able to incur additional debt in the future, including collateralized debt. Although the Senior Credit Facility and the indentures governing the Senior Notes and the Senior Subordinated Notes contain restrictions on the incurrence of additional debt, these restrictions are subject to a number of qualifications and exceptions. If additional debt is added to our current level of debt, the risks described above would increase.

          Centers has announced that it intends to enter into, subject to market and other conditions, a financing transaction with certain lenders. Centers currently expects to use the proceeds from the transaction, if consummated, to, among other things, refinance its existing indebtedness. There can be no assurance that Centers will complete any such refinancing on terms acceptable to it or at all. Centers' inability to complete this refinancing or to complete it on terms that we find favorable could increase the risks described above.

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Our ability to continue to access credit on the terms previously obtained for the funding of our operations and capital projects may be limited due to changes in credit markets.

          In recent periods, the credit markets and the financial services industry have experienced disruption characterized by the bankruptcy, failure, collapse or sale of various financial institutions, increased volatility in securities prices, diminished liquidity and credit availability and intervention from the United States and other governments. Continued concerns about the systemic impact of potential long-term or widespread downturn, energy costs, geopolitical issues, the availability and cost of credit, the global commercial and residential real estate markets and related mortgage markets and reduced consumer confidence have contributed to increased market volatility. The cost and availability of credit has been and may continue to be adversely affected by these conditions. We cannot be certain that funding for our capital needs will be available from our existing financial institutions and the credit markets if needed, and if available, to the extent required, and on acceptable terms. The Revolving Credit Facility matures in March 2012. If we cannot renew or refinance this facility upon its maturity or, more generally, obtain funding when needed, in each case on acceptable terms, we may be unable to continue our current rate of growth and store expansion, which may have an adverse effect on our revenues and results of operations.

          Centers has announced that it intends to enter into, subject to market and other conditions, a financing transaction with certain lenders. Centers currently expects to use the proceeds from the transaction, if consummated, to, among other things, refinance its existing indebtedness. There can be no assurance that Centers will complete any such refinancing on terms acceptable to it or at all.

We require a significant amount of cash to service our debt. Our ability to generate cash depends on many factors beyond our control and, as a result, we may not be able to make payments on our debt obligations.

          We may be unable to generate sufficient cash flow from operations or to obtain future borrowings under our credit facilities or otherwise in an amount sufficient to enable us to pay our debt or to fund our other liquidity needs. In addition, because we conduct our operations through our operating subsidiaries, we depend on those entities for dividends and other payments to generate the funds necessary to meet our financial obligations, including payments on our debt. Under certain circumstances, legal and contractual restrictions, as well as the financial condition and operating requirements of our subsidiaries, may limit our ability to obtain cash from our subsidiaries. If we do not have sufficient liquidity, we may need to refinance or restructure all or a portion of our debt on or before maturity, sell assets, or borrow more money, which we may not be able to do on terms satisfactory to us or at all. In addition, any refinancing could be at higher interest rates and may require us to comply with more onerous covenants which could further restrict our business operations.

          If we are unable to meet our obligations with respect to our debt, we could be forced to restructure or refinance our debt, seek equity financing, or sell assets. A default on any of our debt obligations could trigger certain acceleration clauses and cause those and our other obligations to become immediately due and payable. Upon an acceleration of any of our debt, we may not be able to make payments under our other outstanding debt.

Restrictions in the agreements governing our existing and future indebtedness may prevent us from taking actions that we believe would be in the best interest of our business.

          The agreements governing our existing indebtedness contain and the agreements governing our future indebtedness will likely contain customary restrictions on us or our subsidiaries, including covenants that restrict us or our subsidiaries, as the case may be, from:

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          Our ability to comply with these covenants and other provisions of the Senior Credit Facility and the indentures governing the Senior Notes and the Senior Subordinated Notes may be affected by changes in our operating and financial performance, changes in general business and economic conditions, adverse regulatory developments, or other events beyond our control. The breach of any of these covenants could result in a default under our debt, which could cause those and other obligations to become immediately due and payable. In addition, these restrictions may prevent us from taking actions that we believe would be in the best interest of our business and may make it difficult for us to successfully execute our business strategy or effectively compete with companies that are not similarly restricted.

We depend on the services of key executives and changes in our management team could affect our business strategy and adversely impact our performance and results of operations.

          Our senior executives are important to our success because they have been instrumental in setting our strategic direction, operating our business, identifying, recruiting and training key personnel, identifying opportunities and arranging necessary financing. Losing the services of any of these individuals could adversely affect our business until a suitable replacement is hired. We believe that our senior executives could not be replaced quickly with executives of equal experience and capabilities. We do not maintain key person life insurance policies on any of our executives.

If our risk management methods are not effective, our business, reputation and financial results may be adversely affected.

          We have methods to identify, monitor and manage our risks; however, these methods may not be fully effective. Some of our risk management methods may depend upon evaluation of information regarding markets, customers or other matters that are publicly available or otherwise accessible by us. That information may not in all cases be accurate, complete, up-to-date or properly evaluated. If our methods are not fully effective or we are not successful in monitoring or evaluating the risks to which we are or may be exposed, our business, reputation, financial condition and operating results could be materially and adversely affected. In addition, our insurance policies may not provide adequate coverage.

Compliance with new and existing governmental regulations could increase our costs significantly and adversely affect our results of operations.

          The processing, formulation, manufacturing, packaging, labeling, advertising, and distribution of our products are subject to federal laws and regulation by one or more federal agencies, including the FDA, the Federal Trade Commission (the "FTC"), the Consumer Product Safety Commission, the United States Department of Agriculture, and the Environmental Protection Agency. These activities are also regulated by various state, local, and international laws and agencies of the states and localities in which our products are sold. Government regulations may prevent or delay the introduction, or require the reformulation, of our products, which could result in

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lost revenues and increased costs to us. For instance, the FDA regulates, among other things, the composition, safety, labeling, and marketing of dietary supplements (including vitamins, minerals, herbs, and other dietary ingredients for human use). The FDA may not accept the evidence of safety for any new dietary ingredient that we may wish to market, may determine that a particular dietary supplement or ingredient presents an unacceptable health risk, and may determine that a particular claim or statement of nutritional value that we use to support the marketing of a dietary supplement is an impermissible drug claim, is not substantiated, or is an unauthorized version of a "health claim". See "Business — Government Regulation — Product Regulation" for additional information. Any of these actions could prevent us from marketing particular dietary supplement products or making certain claims or statements with respect to those products. The FDA could also require us to remove a particular product from the market. Any future recall or removal would result in additional costs to us, including lost revenues from any products that we are required to remove from the market, any of which could be material. Any product recalls or removals could also lead to liability, substantial costs, and reduced growth prospects.

          Additional or more stringent regulations of dietary supplements and other products have been considered from time to time. These developments could require reformulation of some products to meet new standards, recalls or discontinuance of some products not able to be reformulated, additional record-keeping requirements, increased documentation of the properties of some products, additional or different labeling, additional scientific substantiation, adverse event reporting, or other new requirements. Any of these developments could increase our costs significantly. The FDA has announced that it plans to publish a guidance governing the notification of new dietary ingredients. Although FDA guidance is not mandatory, it is a strong indication of the FDA's current views on the topic discussed in the guidance, including its position on enforcement. Depending on its recommendations, particularly those relating to animal or human testing, such guidance could also raise our costs and negatively impact our business in several ways, including the potential that the FDA might seek to enjoin the manufacturing of our products because of violation of the Good Manufacturing Practice ("GMP") regulations until the FDA determines that we are in compliance and can resume manufacturing. We may not be able to comply with the new rules without incurring additional expenses, which could be significant. For example, the Dietary Supplement Safety Act (S3002) was introduced in February 2010 and contains many restrictive provisions on the sale of dietary supplements, including, but not limited to, provisions that limit the dietary ingredients acceptable for use in dietary supplements, increased fines for violations of the Dietary Supplement Health and Education Act of 1994 ("DSHEA"), and increased registration and reporting requirements with the FDA. If reintroduced and enacted, this bill could severely restrict the number of dietary supplements available for sale and increase our costs and potential penalties associated with selling dietary supplements.

Our failure to comply with FTC regulations and existing consent decrees imposed on us by the FTC could result in substantial monetary penalties and could adversely affect our operating results.

          The FTC exercises jurisdiction over the advertising of dietary supplements and has instituted numerous enforcement actions against dietary supplement companies, including us, for failure to have adequate substantiation for claims made in advertising or for the use of false or misleading advertising claims. As a result of these enforcement actions, we are currently subject to three consent decrees that limit our ability to make certain claims with respect to our products and required us in the past to pay civil penalties and other amounts in the aggregate amount of $3.0 million. See "Business — Government Regulation — Product Regulation" for more information. Failure by us or our franchisees to comply with the consent decrees and applicable regulations could occur from time to time. Violations of these orders could result in substantial monetary

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penalties, which could have a material adverse effect on our financial condition or results of operations.

We may incur material product liability claims, which could increase our costs and adversely affect our reputation, revenues, and operating income.

          As a retailer, distributor, and manufacturer of products designed for human consumption, we are subject to product liability claims if the use of our products is alleged to have resulted in injury. Our products consist of vitamins, minerals, herbs and other ingredients that are classified as foods or dietary supplements and are not subject to pre-market regulatory approval in the United States. Our products could contain contaminated substances, and some of our products contain ingredients that do not have long histories of human consumption. Previously unknown adverse reactions resulting from human consumption of these ingredients could occur.

          In addition, third-party manufacturers produce many of the products we sell. As a distributor of products manufactured by third parties, we may also be liable for various product liability claims for products we do not manufacture. Although our purchase agreements with our third-party vendors typically require the vendor to indemnify us to the extent of any such claims, any such indemnification is limited by its terms. Moreover, as a practical matter, any such indemnification is dependent on the creditworthiness of the indemnifying party and its insurer, and the absence of significant defenses by the insurers. We may be unable to obtain full recovery from the insurer or any indemnifying third party in respect of any claims against us in connection with products manufactured by such third party.

          We have been and may be subject to various product liability claims, including, among others, that our products include inadequate instructions for use or inadequate warnings concerning possible side effects and interactions with other substances. For example, as of December 31, 2010, there are 50 pending lawsuits related to Hydroxycut in which GNC has been named, including 44 individual, largely personal injury claims and six putative class action cases. See "Business — Legal Proceedings". Any product liability claim against us could result in increased costs and could adversely affect our reputation with our customers, which in turn could adversely affect our revenues and operating income.

We may experience product recalls, which could reduce our sales and margin and adversely affect our results of operations.

          We may be subject to product recalls, withdrawals or seizures if any of the products we formulate, manufacture or sell are believed to cause injury or illness or if we are alleged to have violated governmental regulations in the manufacturing, labeling, promotion, sale or distribution of such products. For example, in May 2009, the FDA warned consumers to stop using Hydroxycut diet products, which are produced by Iovate Health Sciences, Inc. ("Iovate") and were sold in our stores. Iovate issued a voluntary recall, with which we fully complied. Sales of the recalled Hydroxycut products amounted to approximately $57.8 million, or 4.7% of our retail sales in 2008, and $18.8 million, or 4.2% of our retail sales in the first four months of 2009. We provided refunds or gift cards to consumers who returned these products to our stores. In the second quarter of 2009, we experienced a reduction in sales and margin due to this recall as a result of accepting returns of products from customers and a loss of sales as a replacement product was not available. Through September 30, 2010, we estimate that we have refunded approximately $3.5 million to our retail customers and approximately $1.6 million to our wholesale customers for Hydroxycut product returns. Our results of operations may continue to be affected by the Hydroxycut recall. Any additional recall, withdrawal or seizure of any of the products we formulate, manufacture or sell would require significant management attention, would likely result in substantial and unexpected expenditures and could materially and adversely affect our business, financial condition or results of

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operations. Furthermore, a recall, withdrawal or seizure of any of our products could materially and adversely affect consumer confidence in our brands and decrease demand for our products.

Our operations are subject to environmental and health and safety laws and regulations that may increase our cost of operations or expose us to environmental liabilities.

          Our operations are subject to environmental and health and safety laws and regulations, and some of our operations require environmental permits and controls to prevent and limit pollution of the environment. We could incur significant costs as a result of violations of, or liabilities under, environmental laws and regulations, or to maintain compliance with such environmental laws, regulations, or permit requirements. For example, in March 2008, the South Carolina Department of Health and Environmental Control ("DHEC") requested that we investigate contamination associated with historical activities at our South Carolina facility. These investigations have identified chlorinated solvent impacts in soils and groundwater that extend offsite from our facility. We are continuing these investigations in order to understand the extent of these impacts and develop appropriate remedial measures for DHEC approval. At this stage of the investigation, however, it is not possible to accurately estimate the timing and extent of any remedial action that may be required, the ultimate cost of remediation, or the amount of our potential liability.

          In addition to the foregoing, we are subject to numerous federal, state, local, and foreign environmental and health and safety laws and regulations governing our operations, including the handling, transportation, and disposal of our 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 us to incur additional capital and operating expenditures to maintain compliance with environmental laws and regulations and environmental permits. We also are 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 our ability to sell or lease our properties, or to use them as collateral for financing.

We are not insured for a significant portion of our claims exposure, which could materially and adversely affect our operating income and profitability.

          We have procured insurance independently for the following areas: (1) general liability; (2) product liability; (3) directors and officers liability; (4) property insurance; (5) workers' compensation insurance; and (6) various other areas. In addition, although we believe that we will continue to be able to obtain insurance in these areas in the future, because of increased selectivity by insurance providers, we may only be able to obtain such insurance at increased rates and/or with reduced coverage levels. Furthermore, we are self-insured for other areas, including: (1) medical benefits; (2) physical damage to our tractors, trailers, and fleet vehicles for field personnel use; and (3) physical damages that may occur at company-owned stores. We are not insured for some property and casualty risks due to the frequency and severity of a loss, the cost of insurance, and the overall risk analysis. In addition, we carry product liability insurance coverage that requires us to pay deductibles/retentions with primary and excess liability coverage above the deductible/retention amount. Because of our deductibles and self-insured retention amounts, we have significant exposure to fluctuations in the number and severity of claims. We currently maintain product liability insurance with a retention of $3.0 million per claim with an aggregate cap on

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retained loss of $10.0 million. We could raise our deductibles/retentions, which would increase our already significant exposure to expense from claims. If any claim exceeds our coverage, we would bear the excess expense, in addition to our other self-insured amounts. If the frequency or severity of claims or our expenses increase, our operating income and profitability could be materially adversely affected. See "Business — Legal Proceedings".

Because we rely on our manufacturing operations to produce nearly all of the proprietary products we sell, disruptions in our manufacturing system or losses of manufacturing certifications could adversely affect our sales and customer relationships.

          Our manufacturing operations produced approximately 35% and 34% of the products we sold for the years ended December 31, 2009 and 2008, respectively. Other than powders and liquids, nearly all of our proprietary products are produced in our manufacturing facility located in Greenville, South Carolina. During 2009, no one vendor supplied more than 10% of our raw materials. In the event any of our third-party suppliers or vendors becomes unable or unwilling to continue to provide raw materials in the required volumes and quality levels or in a timely manner, we would be required to identify and obtain acceptable replacement supply sources. If we are unable to identify and obtain alternative supply sources, our business could be adversely affected. Any significant disruption in our operations at our Greenville, South Carolina facility for any reason, including regulatory requirements, an FDA determination that the facility is not in compliance with GMPs, the loss of certifications, power interruptions, fires, hurricanes, war or other force of nature, could disrupt our supply of products, adversely affecting our sales and customer relationships.

Increase in the price and shortage of supply of key raw materials could adversely affect our business.

          Our products are composed of certain key raw materials. If the prices of these raw materials were to increase significantly, it could result in a significant increase to us in the prices our contract manufacturers and third-party manufacturers charge us for our GNC-branded products and third-party products. Raw material prices may increase in the future and we may not be able to pass on such increases to our customers. A significant increase in the price of raw materials that cannot be passed on to customers could have a material adverse effect on our results of operations and financial condition. In addition, if we no longer are able to obtain products from one or more of our suppliers on terms reasonable to us or at all, our revenues could suffer. Events such as the threat of political or social unrest, or the perceived threat thereof, may also have a significant impact on raw material prices and transportation costs for our products. In addition, the interruption in supply of certain key raw materials essential to the manufacturing of our products may have an adverse impact on our suppliers' ability to provide us with the necessary products needed to maintain our customer relationships and an adequate level of sales.

A significant disruption to our distribution network or to the timely receipt of inventory could adversely impact sales or increase our transportation costs, which would decrease our profits.

          We rely on our ability to replenish depleted inventory in our stores through deliveries to our distribution centers from vendors and then from the distribution centers or direct ship vendors to our stores by various means of transportation, including shipments by sea and truck. Unexpected delays in those deliveries or increases in transportation costs (including through increased fuel costs) could significantly decrease our ability to make sales and earn profits. In addition, labor shortages in the transportation industry or long-term disruptions to the national and international transportation infrastructure that lead to delays or interruptions of deliveries could negatively affect our business.

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If we fail to protect our brand name, competitors may adopt trade names that dilute the value of our brand name, and prosecuting or defending infringement claims could cause us to incur significant expenses or prevent us from manufacturing, selling, or using some aspect of our products, which could adversely affect our revenues and market share.

          We have invested significant resources to promote our GNC brand name in order to obtain the public recognition that we have today. Because of the differences in foreign trademark laws concerning proprietary rights, our trademark may not receive the same degree of protection in foreign countries as it does in the United States. Also, we may not always be able to successfully enforce our trademark against competitors or against challenges by others. For example, third parties are challenging our "GNC Live Well" trademark in foreign jurisdictions. Our failure to successfully protect our trademark could diminish the value and effectiveness of our past and future marketing efforts and could cause customer confusion. This could in turn adversely affect our revenues and profitability.

          We are currently and may in the future be subject to intellectual property litigation and infringement claims, which could cause us to incur significant expenses or prevent us from manufacturing, selling or using some aspect of our products. Claims of intellectual property infringement also may require us to enter into costly royalty or license agreements. However, we may be unable to obtain royalty or license agreements on terms acceptable to us or at all. Claims that our technology or products infringe on intellectual property rights could be costly and would divert the attention of management and key personnel, which in turn could adversely affect our revenues and profitability.

A substantial amount of our revenue is generated from our franchisees, and our revenues could decrease significantly if our franchisees do not conduct their operations profitably or if we fail to attract new franchisees.

          As of both December 31, 2009 and December 31, 2008, approximately 32% of our retail locations were operated by franchisees. Our franchise operations generated approximately 15.5% and 15.6% of our revenues for the years ended December 31, 2009 and 2008, respectively. Our revenues from franchise stores depend on the franchisees' ability to operate their stores profitably and adhere to our franchise standards. In the twelve months ended December 31, 2009, a net 45 domestic franchise stores were closed. The closing of franchise stores or the failure of franchisees to comply with our policies could adversely affect our reputation and could reduce the amount of our franchise revenues. These factors could have a material adverse effect on our revenues and operating income.

          If we are unable to attract new franchisees or to convince existing franchisees to open additional stores, any growth in royalties from franchise stores will depend solely upon increases in revenues at existing franchise stores. In addition, our ability to open additional franchise locations is limited by the territorial restrictions in our existing franchise agreements as well as our ability to identify additional markets in the United States and other countries. If we are unable to open additional franchise locations, we will have to sustain additional growth internally by attracting new and repeat customers to our existing locations.

Franchisee support of our marketing and advertising programs is critical for our success.

          The support of our franchisees is critical for the success of our marketing programs and other strategic initiatives we seek to undertake, and the successful execution of these initiatives will depend on our ability to maintain alignment with our franchisees. While we can mandate certain strategic initiatives through enforcement of our franchise agreements, we need the active support of our franchisees if the implementation of these initiatives is to be successful. In addition, our efforts to build alignment with franchisees may result in a delay in the implementation of our marketing

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and advertising programs and other key initiatives. Although we believe that our current relationships with our franchisees are generally good, there can be no assurance that our franchisees will continue to support our marketing programs and strategic initiatives. The failure of our franchisees to support our marketing programs and strategic initiatives could adversely affect our ability to implement our business strategy and could materially harm our business, results of operations and financial condition.

Our franchisees are independent operators and we have limited influence over their operations.

          Our revenues substantially depend upon our franchisees' sales volumes, profitability, and financial viability. However, our franchisees are independent operators and we cannot control many factors that impact the profitability of their stores. Pursuant to the franchise agreements, we can, among other things, mandate signage, equipment and hours of operation, establish operating procedures and approve suppliers, distributors and products. However, the quality of franchise store operations may be diminished by any number of factors beyond our control. Consequently, franchisees may not successfully operate stores in a manner consistent with our standards and requirements or standards set by federal, state and local governmental laws and regulations. In addition, franchisees may not hire and train qualified managers and other personnel. While we ultimately can take action to terminate franchisees that do not comply with the standards contained in our franchise agreements, any delay in identifying and addressing problems could harm our image and reputation, and our franchise revenues and results of operations could decline.

Franchise regulations could limit our ability to terminate or replace under-performing franchises, which could adversely impact franchise revenues.

          Our franchise activities are subject to federal, state, and international laws regulating the offer and sale of franchises and the governance of our franchise relationships. These laws impose registration, extensive disclosure requirements, and bonding requirements on the offer and sale of franchises. In some jurisdictions, the laws relating to the governance of our franchise relationship impose fair dealing standards during the term of the franchise relationship and limitations on our ability to terminate or refuse to renew a franchise. We may, therefore, be required to retain an under-performing franchise and may be unable to replace the franchisee, which could adversely impact franchise revenues. In addition, we cannot predict the nature and effect of any future legislation or regulation on our franchise operations.

We have limited influence over the decision of franchisees to invest in other businesses or incur excessive indebtedness.

          Our franchisees are independent operators and, therefore, we have limited influence over their ability to invest in other businesses or incur excessive indebtedness. In some cases, these franchisees have used the cash generated by their stores to expand their other businesses or to subsidize losses incurred by such businesses. Additionally, as independent operators, franchisees do not require our consent to incur indebtedness. Consequently, our franchisees have in the past, and may in the future, experience financial distress as a result of over leveraging. To the extent that our franchisees use the cash from their stores to subsidize their other businesses or experience financial distress, due to over-leverage or otherwise, it could negatively affect (1) our operating results as a result of delayed or reduced payments of royalties, advertising fund contributions and rents for properties we lease to them, (2) our future revenue, earnings and cash flow growth and (3) our financial condition. In addition, lenders that are adversely affected by franchisees who default on their indebtedness may be less likely to provide current or prospective franchisees necessary financing on favorable terms or at all.

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If we cannot open new company-owned stores on schedule and profitably, or if our new store formats are not successful, our planned future growth will be impeded, which would adversely affect sales.

          Our growth is dependent on both increases in sales in existing stores and the ability to open profitable new stores. Increases in sales in existing stores are dependent on factors such as competition, store operations and other factors discussed in these Risk Factors. Our ability to timely open new stores and to expand into additional market areas depends in part on the following factors: the availability of attractive store locations; the absence of occupancy delays; the ability to negotiate acceptable lease terms; the ability to identify customer demand in different geographic areas; the hiring, training and retention of competent sales personnel; the effective management of inventory to meet the needs of new and existing stores on a timely basis; general economic conditions; and the availability of sufficient funds for expansion. Many of these factors are beyond our control. In addition, the costs associated with opening and operating our new store formats are higher than the costs associated with opening and operating our standard modern-design stores. Delays or failures in opening new stores, including our new store formats, or achieving lower than expected sales in new stores and new store formats, or drawing a greater than expected proportion of sales in new stores or new store formats from our existing stores, could materially adversely affect our growth and profitability. In addition, we may not anticipate all of the challenges imposed by the expansion of our operations and, as a result, may not meet our targets for opening new stores, remodeling or relocating stores or expanding profitably.

          Some of our new stores may be located in areas where we have little or no meaningful experience or brand recognition. Those markets may have different competitive conditions, market conditions, consumer tastes and discretionary spending patterns than our existing markets, which may cause our new stores to be less successful than stores in our existing markets. Alternatively, many of our new stores will be located in areas where we have existing stores. Although we have experience in these markets, increasing the number of locations in these markets may result in inadvertent over-saturation of markets and temporarily or permanently divert customers and sales from our existing stores, thereby adversely affecting our overall financial performance.

Our operating results and financial condition could be adversely affected by the financial and operational performance of Rite Aid.

          As of December 31, 2009, Rite Aid operated 1,869 GNC franchise "store-within-a-store" locations and has committed to open additional franchise "store-within-a-store" locations. Revenue from sales to Rite Aid (including license fee revenue for new store openings) represented approximately 3.3% of total revenue for the year ended December 31, 2009. Any liquidity and operational issues that Rite Aid may experience could impair its ability to fulfill its obligations and commitments to us, which would adversely affect our operating results and financial condition.

Economic, political, and other risks associated with our international operations could adversely affect our revenues and international growth prospects.

          As of December 31, 2009, we had 167 company-owned Canadian stores and 1,307 international franchise stores in 47 countries. We derived 10.2% of our revenues for the year ended December 31, 2009 and 10.1% of our revenues for the year ended December 31, 2008 from our international operations. As part of our business strategy, we intend to expand our international franchise presence. Our international operations are subject to a number of risks inherent to operating in foreign countries, and any expansion of our international operations will increase the effects of these risks. These risks include, among others:

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          Any of these risks could have a material adverse effect on our international operations and our growth strategy.

We may be unable to successfully expand our operations into China and other new markets.

          If the opportunity arises, we may expand our operations into new and high-growth markets including, but not limited to, China. For example, we have commenced the process of product registrations and wholesale sales in China. However, there is no assurance that we will expand our operations in China and other markets in our desired time frame. To expand our operations into new markets, we may enter into business combination transactions, make acquisitions or enter into strategic partnerships, joint ventures or alliances, any of which may be material. We may enter into these transactions to acquire other businesses or products to expand our products or take advantage of new developments and potential changes in the industry. Although we have entered into a non-binding term sheet with an affiliate of Bright Food (Group) Co., Ltd. ("BFG") to market and sell nutritional supplements in China through a joint venture, the definitive documentation for the joint venture was not executed on the timeframe that we had expected and there can be no assurances that we will enter into a joint venture with BFG or any other party. Our lack of experience operating in new markets and our lack of familiarity with local economic, political and regulatory systems could prevent us from achieving the results that we expect on our anticipated timeframe or at all. If we are unsuccessful in expanding into new or high growth markets, it could adversely affect our operating results and financial condition.

Our network and communications systems are dependent on third-party providers and are vulnerable to system interruption and damage, which could limit our ability to operate our business and could have a material adverse effect on our business, financial condition or results of operations.

          Our systems and operations and those of our third-party Internet service providers are vulnerable to damage or interruption from fire, flood, earthquakes, power loss, server failure, telecommunications and Internet service failure, acts of war or terrorism, computer viruses and denial-of-service attacks, physical or electronic breaches, sabotage, human error and similar events. Any of these events could lead to system interruptions, processing and order fulfillment delays, and loss of critical data for us, our suppliers, or our Internet service providers, and could prevent us

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from processing customer purchases. Any significant interruption in the availability or functionality of our website or our customer processing, distribution, or communications systems, for any reason, could seriously harm our business, financial condition, and operating results. The occurrence of any of these factors could have a material adverse effect on our business, financial condition or results of operations.

          Because we are dependent on third-party service providers for the implementation and maintenance of certain aspects of our systems and operations and because some of the causes of system interruptions may be outside of our control, we may not be able to remedy such interruptions in a timely manner, if at all. As we rely on our third-party service providers, computer and communications systems and the Internet to conduct our business, any system disruptions could have a material adverse effect on our business, financial condition or results of operations.

Privacy protection is increasingly demanding, and the introduction of electronic payment exposes us to increased risk of privacy and/or security breaches as well as other risks.

          The protection of customer, employee, vendor, franchisee and other business data is critical to us. Federal, state, provincial and international laws and regulations govern the collection, retention, sharing and security of data that we receive from and about our employees, customers, vendors and franchisees. The regulatory environment surrounding information security and privacy has been increasingly demanding in recent years, and may see the imposition of new and additional requirements. Compliance with these requirements may result in cost increases due to necessary systems changes and the development of new processes to meet these requirements by us and our franchisees. In addition, customers and franchisees have a high expectation that we will adequately protect their personal information. If we or our service provider fail to comply with these laws and regulations or experience a significant breach of customer, employee, vendor, franchisee or other company data, our reputation could be damaged and result in an increase in service charges, suspension of service, lost sales, fines, or lawsuits.

          The use of credit payment systems makes us more susceptible to a risk of loss in connection with these issues, particularly with respect to an external security breach of customer information that we or third parties (including those with whom we have strategic alliances) under arrangements with us control. In the event of a security breach, theft, leakage, accidental release or other illegal activity with respect to employee, customer, vendor, franchisee third-party, with whom we have strategic alliances or other company data, we could become subject to various claims, including those arising out of thefts and fraudulent transactions, and may also result in the suspension of credit card services. This could harm our reputation as well as divert management attention and expose us to potentially unreserved claims and litigation. Any loss in connection with these types of claims could be substantial. In addition, if our electronic payment systems are damaged or cease to function properly, we may have to make significant investments to fix or replace them, and we may suffer interruptions in our operations in the interim. In addition, we are reliant on these systems, not only to protect the security of the information stored, but also to appropriately track and record data. Any failures or inadequacies in these systems could expose us to significant unreserved losses, which could result in an earnings and stock price decline. Our brand reputation would likely be damaged as well.

Complying with recently enacted healthcare reform legislation could increase our costs and have a material adverse effect on our business, financial condition or results of operations.

          Recently enacted healthcare reform legislation could significantly increase our costs and have a material adverse effect on our business, financial condition and results of operations by requiring us either to provide health insurance coverage to our employees or to pay certain penalties for electing not to provide such coverage. Because these new requirements are broad, complex, subject to certain phase-in rules and may be challenged by legal actions in the coming months and

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years, it is difficult to predict the ultimate impact that this legislation will have on our business and operating costs. We cannot assure you that this legislation or any alternative version that may ultimately be implemented will not materially increase our operating costs. This legislation could also adversely affect our employee relations and ability to compete for new employees if our response to this legislation is considered less favorable than the responses or health benefits offered by employers with whom we compete for talent.

Our holding company structure makes us dependent on our subsidiaries for our cash flow and subordinates the rights of our stockholders to the rights of creditors of our subsidiaries in the event of an insolvency or liquidation of any of our subsidiaries.

          We are a holding company and, accordingly, substantially all of our operations are conducted through our subsidiaries. Our subsidiaries are separate and distinct legal entities. As a result, our cash flow depends upon the earnings of our subsidiaries. In addition, we depend on the distribution of earnings, loans, or other payments by our subsidiaries to us. Our subsidiaries have no obligation to provide us with funds for our payment obligations. If there is an insolvency, liquidation, or other reorganization of any of our subsidiaries, our stockholders will have no right to proceed against their assets. Creditors of those subsidiaries will be entitled to payment in full from the sale or other disposal of the assets of those subsidiaries before we, as a stockholder, would be entitled to receive any distribution from that sale or disposal.

General economic conditions, including a prolonged weakness in the economy, may affect consumer purchases, which could adversely affect our sales and the sales of our business partners.

          Our results, and those of our business partners to whom we sell, are dependent on a number of factors impacting consumer spending, including general economic and business conditions; consumer confidence; wages and employment levels; the housing market; consumer debt levels; availability of consumer credit; credit and interest rates; fuel and energy costs; energy shortages; taxes; general political conditions, both domestic and abroad; and the level of customer traffic within department stores, malls and other shopping and selling environments. Consumer product purchases, including purchases of our products, may decline during recessionary periods. A prolonged downturn or an uncertain outlook in the economy may materially adversely affect our business and our revenues and profits.

Natural disasters (whether or not caused by climate change), unusually adverse weather conditions, pandemic outbreaks, terrorist acts, and global political events could cause permanent or temporary distribution center or store closures, impair our ability to purchase, receive or replenish inventory, or cause customer traffic to decline, all of which could result in lost sales and otherwise adversely affect our financial performance.

          The occurrence of one or more natural disasters, such as hurricanes, fires, floods, and earthquakes (whether or not caused by climate change), unusually adverse weather conditions, pandemic outbreaks, terrorist acts or disruptive global political events, such as civil unrest in countries in which our suppliers are located, or similar disruptions could adversely affect our operations and financial performance. To the extent these events result in the closure of one or more of our distribution centers, a significant number of stores, a manufacturing facility or our corporate headquarters, or impact one or more of our key suppliers, our operations and financial performance could be materially adversely affected through an inability to make deliveries to our stores and through lost sales. In addition, these events could result in increases in fuel (or other energy) prices or a fuel shortage, delays in opening new stores, the temporary lack of an adequate work force in a market, the temporary or long-term disruption in the supply of products from some local and overseas suppliers, the temporary disruption in the transport of goods from overseas,

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delay in the delivery of goods to our distribution centers or stores, the temporary reduction in the availability of products in our stores and disruption to our information systems. These events also could have indirect consequences, such as increases in the cost of insurance, if they were to result in significant loss of property or other insurable damage.

Risks Relating to an Investment in Our Class A Common Stock

There has been no public market, and it is possible that no trading market will develop or be maintained, for our Class A common stock, and you may not be able to resell shares of our Class A common stock for an amount equal to or more than your purchase price.

          Prior to this offering, there has not been a public market for our Class A common stock. Therefore, stockholders should be aware that they cannot benefit from information about prior market history as to their decision to invest. Although it is anticipated that the Class A common stock will be approved for quotation on the NYSE, there can be no assurance that a trading market will develop or, if such a market does develop, how liquid that market might become or whether it will be maintained. The initial public offering price will be determined by our negotiations with the representatives of the underwriters and may not be indicative of prices that will prevail in the trading market. If an active trading market fails to develop or be maintained, you may be unable to sell the shares of Class A common stock purchased in this offering at an acceptable price or at all.

Our principal stockholders may take actions that conflict with your interests. This control may have the effect of delaying or preventing changes of control or changes in management or limiting the ability of other stockholders to approve transactions they deem to be in their best interest.

          Even after giving effect to this offering, the Sponsors will beneficially own approximately         % of our Class A common stock, OTPP will beneficially own 100% of our Class B common stock, and the Sponsors will collectively own         % of our common stock. As a result, our Sponsors will have the power to control our affairs and policies including with respect to the election of directors (and through the election of directors the appointment of management), the entering into of mergers, sales of substantially all of our assets and other extraordinary transactions. Under the New Stockholders Agreement, the Sponsors will have the right to nominate to our board of directors, subject to their election by our stockholders, so long as the Sponsors collectively own more than 50% of the then outstanding shares of our common stock, the greater of up to nine directors and the number of directors comprising a majority of our board and, subject to certain exceptions, so long as the Sponsors collectively own 50% or less of the then outstanding shares of our common stock, that number of directors (rounded up to the nearest whole number or, if such rounding would cause the Sponsors to have the right to elect a majority of our board of directors, rounded to the nearest whole number) that is the same percentage of the total number of directors comprising our board as the collective percentage of common stock owned by the Sponsors. Under the New Stockholders Agreement, each Sponsor will also agree to vote in favor of the other Sponsor's nominees. Because our board of directors will be divided into three staggered classes, the Sponsors may be able to influence or control our affairs and policies even after they cease to own a majority of our outstanding Class A common stock during the period in which the Sponsors' nominees finish their terms as members of our board, but in any event no longer than would be permitted under applicable law and the NYSE listing requirements. The directors nominated by the Sponsors will have the authority, subject to the terms of our debt, to issue additional stock, implement stock repurchase programs, declare dividends, pay advisory fees and make other decisions, and they may have an interest in our doing so. The New Stockholders Agreement will also provide that, so long as the Sponsors collectively own more than one-third of our then outstanding common stock, certain significant corporate actions will require the approval of at least one of the Sponsors.

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          The interests of the Sponsors could conflict with our public stockholders' interests in material respects. For example, the Sponsors could cause us to make acquisitions that increase the amount of our indebtedness or sell revenue-generating assets. Moreover, the Sponsors are in the business of making investments in companies and may from time to time acquire and hold interests in businesses that compete directly or indirectly with us. The Sponsors may also pursue acquisition opportunities that may be complementary to our business, and as a result, those acquisition opportunities may not be available to us. Furthermore, due to the concentration of voting power among the Sponsors, they could influence or prevent a change of control or other business combination or any other transaction that requires the approval of stockholders, regardless of whether or not other stockholders believe that such transaction is in their best interests. In addition, our governance documents do not contain any provisions applicable to deadlocks among the members of our board, and as a result we may be precluded from taking advantage of opportunities due to disagreements among the Sponsors and their respective board designees. So long as the Sponsors continue to own a significant amount of the outstanding shares of our common stock, they will continue to be able to strongly influence or effectively control our decisions. See "Certain Relationships and Related Transactions — Stockholders Agreements".

We will be a "controlled company" within the meaning of the NYSE rules and, as a result, will qualify for, and intend to rely on, exemptions from certain corporate governance requirements that provide protection to stockholders of other companies.

          After the completion of this offering, the Sponsors will continue to own more than 50% of our outstanding Class A common stock (the only class of common stock entitled to vote for the election and removal of our directors), and the Sponsors will hold more than 50% of the total voting power of our Class A common stock, and, therefore, we will be a "controlled company" under the NYSE corporate governance standards. As a controlled company, we intend to utilize certain exemptions under the NYSE standards that free us from the obligation to comply with certain NYSE corporate governance requirements, including the requirements:

Following this offering, we intend to utilize these exemptions. Although we will have adopted charters for our nominating and corporate governance and compensation committees and intend to conduct annual performance evaluations for these committees, none of these committees will be composed entirely of independent directors immediately following the completion of this offering. In addition, we will rely on the phase-in rules of the Securities and Exchange Commission (the "SEC") and the NYSE with respect to the independence of our audit committee. These rules permit us to have an audit committee that has one member that is independent upon the effectiveness of the registration statement of which this prospectus forms a part, a majority of members that are independent within 90 days thereafter and all members that are independent within one year thereafter. Accordingly, you will not have the same protection afforded to stockholders of companies that are subject to all of the NYSE corporate governance requirements. See "Management — Board of Directors" for more information.

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Our amended and restated certificate of incorporation and our amended and restated bylaws, as amended, will contain anti-takeover protections, which may discourage or prevent a takeover of our company, even if an acquisition would be beneficial to our stockholders.

          Upon completion of this offering, provisions contained in our amended and restated certificate of incorporation and amended and restated bylaws, as amended, as well as provisions of the Delaware General Corporation Law (the "DGCL"), could delay or make it more difficult to remove incumbent directors or for a third party to acquire us, even if a takeover would benefit our stockholders. These provisions will include:

          Our issuance of shares of preferred stock could delay or prevent a change of control of our company. Our board of directors has the authority to cause us to issue, without any further vote or action by our stockholders, up to                          shares of preferred stock, par value $0.001 per share, in one or more series, to designate the number of shares constituting any series, and to fix the rights, preferences, privileges and restrictions thereof, including dividend rights, voting rights, rights and terms of redemption, redemption price or prices and liquidation preferences of such series. The issuance of shares of preferred stock may have the effect of delaying, deferring or preventing a change in control of our company without further action by our stockholders, even where stockholders are offered a premium for their shares.

          In addition, the issuance of shares of preferred stock with voting rights may adversely affect the voting power of the holders of our other classes of voting stock either by diluting the voting power of our other classes of voting stock if they vote together as a single class, or by giving the holders of any such preferred stock the right to block an action on which they have a separate class vote even if the action were approved by the holders of our other classes of voting stock.

          Our incorporation under Delaware law, the ability of our board of directors to create and issue a new series of preferred stock or a stockholder rights plan and certain other provisions that will be contained in our amended and restated certificate of incorporation and amended and restated bylaws could impede a merger, takeover or other business combination involving us or the replacement of our management or discourage a potential investor from making a tender offer for our common stock, which, under certain circumstances, could reduce the market value of our common stock. See "Description of Capital Stock".

Our issuance of preferred stock could adversely affect the market value of our Class A common stock.

          The issuance of shares of preferred stock with dividend or conversion rights, liquidation preferences or other economic terms favorable to the holders of preferred stock could adversely

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affect the market price for our Class A common stock by making an investment in the Class A common stock less attractive. For example, a conversion feature could cause the trading price of our Class A common stock to decline to the conversion price of the preferred stock.

The price of our Class A common stock may fluctuate substantially.

          The initial public offering price for the shares of our Class A common stock sold in this offering will be determined by negotiation between the representatives of the underwriters and us. This price may not reflect the market price of our Class A common stock following this offering. In addition, the market price of our Class A common stock is likely to be highly volatile and may fluctuate substantially due to many factors, including:

          In addition, the stock market in general, the NYSE and the market for health and nutritional supplements companies in particular have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. If any of these factors causes us to fail to meet the expectations of securities analysts or investors, or if adverse conditions prevail or are perceived to prevail with respect to our business, the price of our Class A common stock would likely drop significantly.

We currently do not intend to pay dividends on our common stock after this offering. Consequently, your only opportunity to achieve a return on your investment is if the price of our Class A common stock appreciates.

          We currently do not plan to declare dividends on shares of our common stock after this offering and for the foreseeable future. Further, Centers is currently restricted from declaring or paying cash dividends to us pursuant to the terms of the Senior Credit Facility, its Senior Subordinated Notes, and its Senior Notes, which effectively restricts us from declaring or paying any cash dividends. Centers has already used exceptions to these restrictions to make permitted restricted payments to us in August 2009 and March 2010 totaling approximately $42.0 million. See "Dividend Policy" for more information. Consequently, your only opportunity to achieve a return on your investment in our company will be if the market price of our Class A common stock appreciates and you sell your shares at a profit. There is no guarantee that the price of our Class A common stock that will prevail in the market after this offering will ever exceed the price that you pay.

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Future sales of our Class A common stock could cause the market price for our Class A common stock to decline.

          Upon consummation of this offering, there will be                          shares of our Class A common stock outstanding. All shares of Class A common stock sold in this offering will be freely transferable without restriction or further registration under the Securities Act of 1933, as amended (the "Securities Act"). Of the remaining shares of Class A common stock outstanding,                          will be restricted securities within the meaning of Rule 144 under the Securities Act, but will be eligible for resale subject to applicable volume, manner of sale, holding period and other limitations of Rule 144. We cannot predict the effect, if any, that market sales of shares of our Class A common stock or the availability of shares of our Class A common stock for sale will have on the market price of our Class A common stock prevailing from time to time. Sales of substantial amounts of shares of our Class A common stock in the public market, or the perception that those sales will occur, could cause the market price of our Class A common stock to decline. After giving effect to this offering, the Sponsors will hold                          shares of our Class A common stock and                          shares of our Class B common stock, each of which is convertible into one share of Class A common stock, all of which constitute "restricted securities" under the Securities Act. Provided the holders comply with the applicable volume limits and other conditions prescribed in Rule 144 under the Securities Act, all of these restricted securities are currently freely tradable.

          Additionally, as of the consummation of this offering, approximately                          shares of our Class A common stock will be issuable upon exercise of stock options that vest and are exercisable at various dates through                          , with an average weighted exercise price of $             . Of such options,                           will be immediately exercisable. As soon as practicable after the completion of this offering, we intend to file a registration statement on Form S-8 under the Securities Act covering shares of our Class A common stock reserved for issuance under our equity incentive plan. Accordingly, shares of our Class A common stock registered under such registration statement will be available for sale in the open market upon exercise by the holders, subject to vesting restrictions, Rule 144 limitations applicable to our affiliates and the contractual lock-up provisions described below.

          We and certain of our stockholders, directors and officers have agreed to a "lock-up", pursuant to which neither we nor they will sell any shares without the prior consent of the representatives of the underwriters for 180 days after the date of this prospectus, subject to certain exceptions and extensions under certain circumstances. Following the expiration of the applicable lock-up period, all these shares of our Class A common stock will be eligible for future sale, subject to the applicable volume, manner of sale, holding period and other limitations of Rule 144. In addition, the Sponsors have certain demand and "piggy-back" registration rights with respect to the Class A common stock that they will retain following this offering. See "Shares Eligible for Future Sale" for a discussion of the shares of Class A common stock that may be sold into the public market in the future, including Class A common stock held by the Sponsors.

As a new investor, you will experience substantial dilution in the net tangible book value of your shares.

          The initial public offering price of our Class A common stock will be considerably more than the net tangible book value per share of our outstanding Class A common stock. Accordingly, investors purchasing shares of Class A common stock from us in this offering will:

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Our dual-class capitalization structure and the conversion features of our Class B common stock may dilute the voting power of the holders of our Class A common stock.

          We have a dual-class capitalization structure, which may pose a significant risk of dilution to our Class A common stockholders. Each share of our Class B common stock, which is not entitled to vote for the election and removal of our directors, is convertible at any time at the option of the Class B holder into one share of Class A common stock, which is entitled to vote for the election and removal of our directors. Conversion of our Class B common stock into Class A common stock would dilute holders of Class A common stock, including holders of shares purchased in this offering, in terms of voting power in connection with the election and removal of our directors.

If securities or industry analysts do not publish research or reports about us, or if they adversely change their recommendations regarding our Class A common stock, then our stock price and trading volume could decline.

          The trading market for our Class A common stock will be influenced by the research and reports that industry or securities analysts publish about us, our industry and our market. If no analyst elects to cover us and publish research or reports about us, the market for our Class A common stock could be severely limited and our stock price could be adversely affected. In addition, if one or more analysts ceases coverage of us or fails to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. If one or more analysts who elect to cover us adversely change their recommendation regarding our unrestricted Class A common stock, our stock price could decline.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

          This prospectus includes forward-looking statements within the meaning of federal securities laws. Forward-looking statements include statements that may relate to our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, and other information that is not historical information. Many of these statements appear, in particular, under the headings "Prospectus Summary", "Risk Factors", "Management's Discussion and Analysis of Financial Condition and Results of Operations", and "Business". Forward-looking statements can often be identified by the use of terminology such as "subject to", "believe", "anticipate", "plan", "expect", "intend", "estimate", "project", "may", "will", "should", "would", "could", "can", the negatives thereof, variations thereon, and similar expressions, or by discussions of strategy.

          All forward-looking statements, including, without limitation, our examination of historical operating trends, are based upon our current expectations and various assumptions. We believe there is a reasonable basis for our expectations and beliefs, but they are inherently uncertain. We may not realize our expectations, and our beliefs may not prove correct. Actual results could differ materially from those described or implied by such forward-looking statements. The following uncertainties and factors, among others (including those set forth under "Risk Factors"), could affect future performance and cause actual results to differ materially from those matters expressed in or implied by forward-looking statements:

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          Consequently, forward-looking statements should be regarded solely as our current plans, estimates, and beliefs. You should not place undue reliance on forward-looking statements. We cannot guarantee future results, events, levels of activity, performance, or achievements. We do not undertake and specifically decline any obligation to update, republish, or revise forward-looking statements to reflect future events or circumstances or to reflect the occurrences of unanticipated events.

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USE OF PROCEEDS

          We estimate that our net proceeds from this offering will be approximately $              million, based on an assumed initial public offering price of $             per share, the midpoint of the price range set forth on the front cover of this prospectus, and after deducting estimated underwriting discounts and commissions and estimated offering expenses.

          We intend to use the net proceeds we receive from this offering, together with cash on hand, to redeem all of our outstanding shares of Series A preferred stock immediately following completion of this offering at a redemption price per share of $ 5.00, plus accrued and unpaid dividends through the redemption date and related expenses. The per share accrued and unpaid dividends on a share of Series A preferred stock was $2.27 as of December 31, 2010.

          Ares, OTPP and members of management hold substantially all of our outstanding Series A preferred stock and, therefore, will receive substantially all of the cash paid to redeem such stock. For a description of the shares of our Series A preferred stock held by our affiliates that will be redeemed immediately following the completion of this offering, see "Principal and Selling Stockholders".

          Any net proceeds remaining after payment for the redemption of the Series A preferred stock will be used for working capital and general corporate purposes. We will not receive any proceeds from the sale of the shares being offered by the selling stockholders.


DIVIDEND POLICY

          We currently do not anticipate paying any cash dividends after this offering and for the foreseeable future. Instead, we anticipate that all of our earnings on our common stock, in the foreseeable future will be used to repay debt, for working capital, to support our operations, and to finance the growth and development of our business. Any future determination relating to dividend policy will be made at the discretion of our board of directors and will depend on a number of factors, including restrictions in our debt instruments, our future earnings, capital requirements, financial condition, future prospects, and applicable Delaware law, which provides that dividends are only payable out of surplus or current net profits.

          Currently, Centers is restricted from declaring or paying cash dividends to us pursuant to the terms of the Senior Credit Facility, the Senior Notes, and the Senior Subordinated Notes, which restricts our ability to declare or pay any cash dividends. Centers has already used exceptions to these restrictions to make permitted restricted payments to us in August 2009 and March 2010 totaling approximately $42.0 million. These payments were determined to be in compliance with Centers' debt covenants.

          OTPP, as the holder of our Class B common stock, is entitled to receive ratably an annual special dividend payment equal to an aggregate amount of $750,000 when, as and if declared by the board of directors, for a period of ten years commencing on March 16, 2007 (the "Special Dividend Period"). The special dividend payment is payable in equal quarterly installments on the first day of each quarter commencing on April 1, 2007.

          Upon the consummation of a change in control transaction or a bona fide initial public offering, OTPP will receive, in lieu of the quarterly special dividend payments, an automatic payment equal to the net present value of the aggregate amount of the special dividend payments that would have been payable to OTPP during the remainder of the Special Dividend Period, calculated in good faith by our board of directors. We estimate this amount would have been $              million had the offering occurred on                          . Immediately prior to the consummation of this offering, we intend to use cash on hand to satisfy this obligation.

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CAPITALIZATION

          The following table sets forth our capitalization as of September 30, 2010 on:

          The table below should be read in conjunction with "Use of Proceeds", "Selected Consolidated Financial Data", "Management's Discussion and Analysis of Financial Condition and Results of Operations", "Description of Capital Stock", "Description of Certain Debt", and our consolidated financial statements and their notes included in this prospectus.

 
  As of September 30, 2010  
 
 
Actual
 
As Adjusted
 
 
  (Unaudited)
(In millions,
except share data)

 

Cash and cash equivalents(1)

  $ 165.2   $    
           

Long-term debt (including current maturities):

             
 

Senior credit facility(2)

  $ 644.4   $    
 

Mortgage and capital leases

    6.1        
 

Senior notes

    298.3        
 

Senior subordinated notes

    110.0        
           
   

Total long-term debt

    1,058.8        
           

Stockholders' equity:

             

Preferred stock, $0.001 par value, 60,000,000 shares authorized:

             
 

Series A, 30,500,005 shares designated, 30,133,615 shares issued, 29,867,046 shares outstanding and 266,569 shares held in treasury, actual; no shares issued and outstanding, as adjusted(3)

    213.0        

Common stock, $0.001 par value(4):

             
 

Class A, 59,967,949 shares issued, 59,198,688 shares outstanding and 769,261 shares held in treasury, actual;             shares authorized,             shares issued,              shares outstanding and             shares held in treasury, as adjusted

    0.1        
 

Class B, 28,168,561 shares issued and outstanding, actual;             shares authorized             shares issued and             shares outstanding, as adjusted

    0.0        
 

Paid-in-capital

    450.9        
 

Retained earnings

    157.7        
 

Treasury stock

    (2.2 )      
 

Accumulated other comprehensive loss

    (4.3 )      
           
   

Total stockholders' equity

    815.2        
           
     

Total capitalization

  $ 1,874.0   $    
           

(1)
Satisfaction of our obligations under the ACOF Management Services Agreement and the Class B common stock will have the effect of decreasing cash and cash equivalents by approximately $          million, based on the assumption that this offering occurred on                          .

(2)
The Senior Credit Facility consists of our $60 million Revolving Credit Facility and a $675.0 million Term Loan Facility. As of September 30, 2010, no amounts had been drawn on the Revolving Credit Facility. Total availability under the Revolving Credit Facility was $44.7 million, after giving effect to $9.0 million of outstanding letters of credit and a $6.3 million commitment from Lehman that we do not expect Lehman will fund.

(3)
We intend to use our net proceeds from this offering to redeem all of our outstanding Series A preferred stock.

(4)
With respect to our Class A and Class B common stock, we are authorized to issue 150,000,000 shares collectively, at September 30, 2010.

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DILUTION

          Purchasers of our Class A common stock in this offering will experience an immediate dilution of net tangible book value per share from the initial public offering price. Dilution in net tangible book value per share represents the difference between the amount per share paid by purchasers of shares of Class A common stock and the net tangible book value per share immediately after this offering.

          At September 30, 2010, the net tangible book deficit of our common stock was approximately $(404.3) million, or approximately $(4.63) per share of our common stock. After giving effect to (1) the sale of shares of our Class A common stock in this offering at an assumed initial public offering price of $             per share, the midpoint of the price range set forth on the front cover of this prospectus, and after deducting estimated underwriting discounts and commissions and the estimated offering expenses of this offering, and (2) the use of cash on hand immediately prior to this offering to satisfy our obligations under the ACOF Management Services Agreement and our Class B common stock totaling $              million, the as adjusted net tangible book value at September 30, 2010 attributable to common stockholders would have been approximately $              million, or approximately $             per share of our common stock. This represents a net increase in net tangible book value of $             per existing share and an immediate dilution in net tangible book value of $             per share to new stockholders. The following table illustrates this per share dilution to new stockholders:

Assumed initial public offering price per share

        $    
 

Net tangible book value per share as of September 30, 2010

  $          
 

Increase in net tangible book value per share attributable to this offering

  $          

As adjusted net tangible book value per share after this offering

        $    

Dilution in net tangible book value per share to new stockholders

        $    

          The table below summarizes, as of September 30, 2010, the differences for (1) our existing stockholders, and (2) investors in this offering, with respect to the number of shares of Class A common stock purchased from us, the total consideration paid, and the average price per share paid before deducting fees and expenses.

 
  Shares Issued   Total Consideration  
Average
Price per
Share
 
 
 
Number
 
Percentage
 
Amount
 
Percentage
 

Existing stockholders

            %           %      

New stockholders in this offering

            %           %      
 

Total

                               

          The foregoing discussion and tables assumes no exercise of stock options to purchase           shares of our Class A common stock subject to outstanding stock options with a weighted average exercise price of $           per share as of September 30, 2010 and excludes                          shares of our Class A common stock available for future grant or issuance under our stock plans. To the extent that any options having an exercise price that is less than the offering price of this offering are exercised, new investors will experience further dilution.

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SELECTED CONSOLIDATED FINANCIAL DATA

          The selected consolidated financial data presented below as of and for the Successor Periods and the period from January 1, 2007 to March 15, 2007 are derived from our audited consolidated financial statements and their notes included in this prospectus. The selected consolidated financial data presented below as of and for the years ended December 31, 2006 and 2005, are derived from our audited consolidated financial statements and their notes, which are not included in this prospectus. The selected consolidated financial data as of December 31, 2006, and 2005 and for the period from January 1, 2007 to March 15, 2007 and for the years ended December 31, 2006 and 2005 represent the period during which GNC Parent Corporation was owned by an investment fund managed by Apollo.

          The consolidated financial data presented below for the nine months ended September 30, 2009 and 2010 are derived from our unaudited consolidated financial statements and accompanying notes included in this prospectus and include, in the opinion of management, all adjustments, consisting only of normal recurring adjustments, for a fair statement of our financial position and operating results as of and for the nine months ended September 30, 2009 and 2010. Our results for interim periods are not necessarily indicative of our results for a full year of operations.

          Together with our wholly owned subsidiary GNC Acquisition Inc., we entered into the Merger Agreement with GNC Parent Corporation on February 8, 2007. On March 16, 2007, the Merger was consummated. As a result of the Merger, the consolidated statement of operations for the Successor Periods includes the following: interest and amortization expense resulting from the issuance of the Senior Notes and the Senior Subordinated Notes; and amortization of intangible assets related to the Merger. Further, as a result of purchase accounting, the fair values of our assets on the date of the Merger became their new cost basis.

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          You should read the following financial information together with the information under "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and their related notes.

 
  Successor    
  Predecessor  
 
 
Nine Months
Ended
September 30,
2010
 
Nine Months
Ended
September 30,
2009
 
Year Ended
December 31,
2009
 
Year Ended
December 31,
2008
 
March 16-
December 31,
2007
   
 
January 1-
March 15,
2007
 
Year Ended
December 31,
2006
 
Year Ended
December 31,
2005
 
 
  (unaudited)
   
   
   
   
   
   
   
 
 
   
   
  (Dollars in millions,
except share data)

 

   
   
   
 

Statement of Operations Data:

                                                     

Revenue:

                                                     
 

Retail

  $ 1,031.9   $ 962.6   $ 1,256.3   $ 1,219.3   $ 909.3       $ 259.3   $ 1,122.7   $ 989.4  
 

Franchising

    222.4     201.1     264.2     258.0     193.9         47.2     232.3     212.8  
 

Manufacturing/Wholesale

    132.1     139.4     186.5     179.4     119.8         23.3     132.1     115.5  
                                       

Total revenue

  $ 1,386.4   $ 1,303.1   $ 1,707.0   $ 1,656.7   $ 1,223.0       $ 329.8   $ 1,487.1   $ 1,317.7  

Cost of sales, including costs of warehousing and distribution, and occupancy

    893.8     849.2     1,116.4     1,082.6     814.2         212.2     983.5     898.7  
                                       

Gross profit

    492.6     453.9     590.6     574.1     408.8         117.6     503.6     419.0  

Compensation and related benefits

    204.7     196.3     263.0     249.8     195.8         64.3     260.8     228.6  

Advertising and promotion

    40.4     40.2     50.0     55.1     35.0         20.5     50.7     44.7  

Other selling, general, and administrative

    75.3     74.1     96.7     98.9     71.5         17.6     94.9     76.6  

Other (income) expense(1)

    (0.1 )       (0.1 )   0.7     (0.4 )       (0.2 )   0.5     (3.1 )

Merger related costs

                            34.6          
                                       

Operating income (loss)

    172.3     143.3     181.0     169.6     106.9         (19.2 )   96.7     72.2  

Interest expense, net

    49.2     53.0     69.9     83.0     75.5         72.8     45.6     43.1  
                                       

Income (loss) before income taxes

    123.1     90.3     111.1     86.6     31.4         (92.0 )   51.1     29.1  

Income tax expense (benefit)

    45.4     33.4     41.6     32.0     12.6         (21.6 )   19.3     10.7  
                                       

Net income (loss)

  $ 77.7   $ 56.9   $ 69.5   $ 54.6   $ 18.8       $ (70.4 ) $ 31.8   $ 18.4  
                                       

Weighted average shares outstanding:

                                                     
 

Basic

    87,350     87,448     87,421     87,761     87,784         50,607     50,532     50,606  
 

Diluted

    88,644     87,730     87,859     87,787     87,784         50,607     52,176     51,595  

Net income (loss) per share(2):

                                                     
 

Basic

  $ 0.72   $ 0.49   $ 0.58   $ 0.43   $ 0.08       $ (1.39 ) $ 0.34   $ 0.07  
 

Diluted

  $ 0.70   $ 0.49   $ 0.58   $ 0.43   $ 0.08       $ (1.39 ) $ 0.32   $ 0.07  
                                       

Balance Sheet Data (at end of period):

                                                     

Cash and cash equivalents

  $ 165.2   $ 79.4   $ 89.9   $ 44.3   $ 28.9             $ 25.6   $ 86.0  

Working capital(3)

    489.0     376.6     397.0     306.8     258.1               250.0     296.9  

Total assets

    2,407.2     2,313.0     2,319.6     2,293.8     2,239.6               981.7     1,023.8  

Total current and non-current long-term debt

    1,058.8     1,065.1     1,059.8     1,084.7     1,087.0               857.9     473.4  

Preferred stock

    213.0     192.9     197.7     179.3     162.2                   127.1  

Total stockholders' equity

    815.2     716.4     732.0     653.8     608.4               (99.0 )   212.1  

Statement of Cash Flows:

                                                     

Net cash provided by (used in) operating activities

  $ 97.6   $ 77.8   $ 114.0   $ 77.4   $ 92.0       $ (51.0 ) $ 73.9   $ 64.2  

Net cash used in investing activities

    (21.2 )   (22.0 )   (42.2 )   (60.4 )   (1,672.2 )       (6.2 )   (23.4 )   (21.5 )

Net cash (used in) provided by financing activities

    (1.1 )   (21.1 )   (26.4 )   (1.4 )   1,598.7         42.2     (111.0 )   (41.7 )

Other Data:

                                                     

EBITDA(4)

  $ 206.1   $ 177.9   $ 227.7   $ 212.1   $ 136.9       $ (11.8 ) $ 135.9   $ 113.2  

Capital expenditures(5)

    21.0     20.4     28.7     48.7     28.9         5.7     23.8     20.8  

(1)
Other (income) expense includes foreign currency (gain) loss for all periods presented. Other (income) expense for the year ended December 31, 2006 includes a $1.2 million loss on the sale of our Australian manufacturing facility. Other (income) expense for the year ended December 31, 2005 includes $2.5 million of transaction fee income related to the transfer of our GNC Australian franchise rights to an existing franchisee.

(2)
Includes impact of dividends on our Series A preferred stock.

(3)
Working capital represents current assets less current liabilities.

(4)
We define EBITDA as net income before interest expense (net), income tax expense, depreciation and amortization. Management uses EBITDA as a tool to measure operating performance of the business. EBITDA is not a measurement of our financial performance under GAAP and should not be considered as an alternative to net income, operating income, or any other performance measures derived in accordance with GAAP, or as an alternative to GAAP cash flow from operating activities, as a measure of our profitability or liquidity.

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  Successor    
  Predecessor  
 
 
Nine Months
Ended
September 30,
2010
 
Nine Months
Ended
September 30,
2009
 
Year Ended
December 31,
2009
 
Year Ended
December 31,
2008
 
March 16-
December 31,
2007
   
 
January 1-
March 15,
2007
 
Year Ended
December 31,
2006
 
Year Ended
December 31,
2005
 
 
  (Unaudited)
   
   
   
   
   
   
   
 
 
   
   
  (dollars in millions)
   
   
   
   
 

Net income (loss)

  $ 77.7   $ 56.9   $ 69.5   $ 54.6   $ 18.8       $ (70.4 ) $ 31.8   $ 18.4  

Interest expense, net

    49.2     53.0     69.9     83.0     75.5         72.8     45.6     43.1  

Income tax expense (benefit)

    45.4     33.4     41.6     32.0     12.6         (21.6 )   19.3     10.7  

Depreciation and amortization

    33.8     34.6     46.7     42.5     30.0         7.4     39.2     41.0  
                                       

EBITDA

  $ 206.1 (a) $ 177.9 (b) $ 227.7 (b) $ 212.1 (b) $ 136.9 (b)     $ (11.8 )(c) $ 135.9 (d) $ 113.2 (d)
                                       

(5)
Capital expenditures for the year ended December 31, 2008 include approximately $10.1 million incurred in conjunction with our store register upgrade program.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

          You should read the following discussion in conjunction with "Selected Consolidated Financial Data" and our consolidated financial statements and the related notes thereto. The discussion in this section contains forward-looking statements that involve risks and uncertainties. See "Risk Factors" included in this prospectus for a discussion of important factors that could cause actual results to differ materially from those described or implied by the forward-looking statements contained herein. We urge you to review the information set forth in "Special Note Regarding Forward-Looking Statements" and "Risk Factors" included in this prospectus.

Business Overview

          We are a global specialty retailer of nutritional supplements, which include VMHS, sports nutrition products, diet products, and other wellness products. We derive our revenues principally from product sales through our company-owned stores and online through GNC.com, franchise activities, and sales of products manufactured in our facilities to third parties. We sell products through a worldwide network of more than 7,100 locations operating under the GNC brand name.

Revenues and Operating Performance from our Business Segments

          We measure our operating performance primarily through revenues and operating income from our three business segments, Retail, Franchise, and Manufacturing/Wholesale, and through the management of unallocated costs from our warehousing, distribution and corporate segments, as follows:

          As described above, our industry is expected to grow at an annual average rate of approximately 5.3% through 2015. Although we do not anticipate the number of our domestic franchise stores to grow substantially, we expect to achieve domestic franchise store revenue growth consistent with projected industry growth, which will be generated by royalties on franchise retail sales and product sales to our existing franchisees. As a result of our efforts to expand our international presence and provisions in our international franchising agreements requiring franchisees to open additional stores, we have increased our international store base in recent periods and expect to continue to increase the number of our international franchise stores over the next five years. We believe this will result in additional franchise fees associated with new store openings and increased revenues from product sales to, and royalties from, new franchisees. As our existing international franchisees continue to open additional stores, we also anticipate that franchise revenue from international operations will be driven by increased product sales to, and

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royalties from, our franchisees. Since our international franchisees pay royalties to us in U.S. dollars, any strengthening of the U.S. dollar relative to our franchisees' local currency may offset some of the growth in royalty revenue.

          A significant portion of our business infrastructure is comprised of fixed operating costs. Our vertically-integrated distribution network and manufacturing capacity can support higher sales volume without significant incremental costs. We therefore expect our operating expenses to grow at a lesser rate than our revenues, resulting in positive operating leverage.

          The following trends and uncertainties in our industry could affect our operating performance as follows:

Executive Overview

          Our recent results of operations reflect steady growth, including through a difficult economic environment and despite a short-term reduction in revenue that we experienced in 2009 due to the Hydroxycut recall. In the first nine months of 2010, we achieved revenue growth of 6.4%, operating income growth of 20.3% and net income growth of 36.7% compared to the same period in 2009. Operating income growth resulted from higher sales and margins in our retail and franchise segments and effective cost controls on unallocated expenses. Net income growth resulted primarily from higher operating income and lower interest expense.

          Recent revenue growth in our domestic retail segment has been driven primarily by increases in the sports nutrition category resulting from new product introductions. In addition, we have experienced significant growth in our GNC.com business primarily as a result of our redesigned website. In recent periods, our domestic franchise business has achieved increased product sales despite a lower store base. Sales in the international franchise business have grown steadily as a result of an increased store base and strong organic sales growth.

          Our manufacturing strategy is designed to provide our stores with proprietary products at the lowest possible cost, and utilize additional capacity to promote production efficiencies and enhance

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our position in the third-party contract business. Under this strategy, our third-party manufacturing sales increased by 38.7% and 3.8% in 2008 and 2009, respectively, over the prior year periods. In the first nine months of 2010, our manufacturing segment experienced reduced sales in contract manufacturing compared with the first nine months of 2009, partially offset by higher product sales to Rite Aid, drugstore.com and PetSmart. The reduction in the contract manufacturing business reflects a transition period during which we are moving from low margin commodity contracts to higher margin, specialty product contracts.

          We also continue to invest in opportunities to expand our brand beyond our existing domestic company-owned footprint and partner with companies like PepsiCo and PetSmart to develop new and innovative products. We believe that these ventures, together with our direct investments in international markets like China, represent attractive growth opportunities. For the nine months ended September 30, 2010, we incurred $4.1 million of start-up expenses related to our operations in China and joint ventures with PepsiCo, in connection with the development of a new brand of fortified coconut water called Phenom, and with PetSmart, in connection with the development, manufacture and distribution of nutritional supplements for pets. Additionally, for the nine months ended September 30, 2010, we made payments in an aggregate amount of $1.1 million to the Sponsors related to the management fee and the special dividend payments on our Class B common stock, which payments will cease following the completion of this offering. Subsequent to completion of the nine months ended September 30, 2010, we also incurred non-recurring expenses related to the exploration of strategic alternatives.

Basis of Presentation

          The accompanying consolidated financial statements and footnotes have been prepared by us in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and with the instructions to Regulation S-K and Regulation S-X. Our normal reporting period is based on a calendar year.

          The financial statements as of and for the years ended December 31, 2009, 2008 and 2007 reflect periods subsequent to the Merger and include the accounts of us and our wholly owned subsidiaries. Included for the years ended 2009 and 2008 and for the period from March 16, 2007 through December 31, 2007 are fair value adjustments to assets and liabilities, including inventory, goodwill, other intangible assets and property, plant and equipment. Accordingly, the accompanying financial statements for the periods prior to the Merger are labeled as "Predecessor" and the periods subsequent to the Merger are labeled as "Successor".

Results of Operations

          The following information presented as of December 31, 2009, 2008, and 2007 and for the years ended December 31, 2009 and 2008, for the period March 16, 2007 to December 31, 2007, and for the period January 1 to March 15, 2007 was derived from our audited consolidated financial statements and accompanying notes which are included in this prospectus.

          The following information may contain financial measures other than in accordance with generally accepted accounting principles, and should not be considered in isolation from or as a substitute for our historical consolidated financial statements. In addition, the adjusted combined operating results may not reflect the actual results we would have achieved absent the adjustments and may not be predictive of future results of operations. We present this information because we use it to monitor and evaluate our ongoing operating results and trends, and believe it provides investors with an understanding of our operating performance over comparative periods.

          As discussed in the "Segment" note to our consolidated financial statements, we evaluate segment operating results based on several indicators. The primary key performance indicators are revenues and operating income or loss for each segment. Revenues and operating income or loss, as evaluated by management, exclude certain items that are managed at the consolidated level,

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such as warehousing and transportation costs, impairments, and other corporate costs. The following discussion compares the revenues and the operating income or loss by segment, as well as those items excluded from the segment totals.

          Same store sales growth reflects the percentage change in same store sales in the period presented compared to the prior year period. Same store sales are calculated on a daily basis for each store and exclude the net sales of a store for any period if the store was not open during the same period of the prior year. We also include our internet sales, as generated through GNC.com and www.drugstore.com, in our domestic company-owned same store sales calculation. When a store's square footage has been changed as a result of reconfiguration or relocation in the same mall or shopping center, the store continues to be treated as a same store. If, during the period presented, a store was closed, relocated to a different mall or shopping center, or converted to a franchise store or a company-owned store, sales from that store up to and including the closing day or the day immediately preceding the relocation or conversion are included as same store sales as long as the store was open during the same period of the prior year. We exclude from the calculation sales during the period presented that occurred on or after the date of relocation to a different mall or shopping center or the date of a conversion.

 
  Successor    
  Predecessor  
 
  Nine Months Ended
  Nine Months Ended
  Year Ended
  Year Ended
  March 16-
   
  January 1-
 
 
 
September 30, 2010
 
September 30, 2009
 
December 31, 2009
 
December 31, 2008
 
December 31, 2007
   
 
March 15, 2007
 
 
  (unaudited)
   
   
   
   
   
   
   
   
   
 
 
   
   
   
   
  (Dollars in millions)
   
   
   
   
   
 

Statement of Operations data:

                                                                             

Revenue:

                                                                             
 

Retail

  $ 1,031.9     74.4 % $ 962.6     73.9 % $ 1,256.3     73.6 % $ 1,219.3     73.6 % $ 909.3     74.3 %     $ 259.3     78.6 %
 

Franchising

    222.4     16.0 %   201.1     15.4 %   264.2     15.5 %   258.0     15.6 %   193.9     15.9 %       47.2     14.3 %
 

Manufacturing/Wholesale

    132.1     9.6 %   139.4     10.7 %   186.5     10.9 %   179.4     10.8 %   119.8     9.8 %       23.3     7.1 %
                                                       

Total net revenue

  $ 1,386.4     100.0 % $ 1,303.1     100.0 % $ 1,707.0     100.0 % $ 1,656.7     100.0 % $ 1,223.0     100.0 %     $ 329.8     100.0 %

Operating expenses:

                                                                             

Cost of sales, including costs of warehousing and distribution, and occupancy

    893.8     64.5 %   849.2     65.2 %   1,116.4     65.4 %   1,082.6     65.3 %   814.2     66.6 %       212.2     64.3 %

Compensation and related benefits

    204.7     14.8 %   196.3     15.1 %   263.0     15.4 %   249.8     15.1 %   195.8     16.0 %       64.3     19.5 %

Advertising and promotion

    40.4     2.9 %   40.2     3.1 %   50.0     2.9 %   55.1     3.3 %   35.0     2.9 %       20.5     6.2 %

Other selling, general, and administrative

    69.4     5.0 %   66.8     5.1 %   86.9     5.1 %   88.0     5.3 %   62.3     5.1 %       16.7     5.1 %

Amortization expense

    5.9     0.4 %   7.3     0.5 %   9.8     0.6 %   10.9     0.7 %   9.2     0.8 %       0.9     0.3 %

Foreign currency (gain) loss

    (0.1 )   0.0 %       0.0 %   (0.1 )   0.0 %   0.7     0.0 %   (0.4 )   0.0 %       (0.2 )   -0.1 %

Merger related costs

        0.0 %       0.0 %       0.0 %       0.0 %       0.0 %       34.6     10.5 %
                                                       

Total operating expenses

    1,214.1     87.6 %   1,159.8     89.0 %   1,526.0     89.4 %   1,487.1     89.8 %   1,116.1     91.3 %       349.0     105.8 %
                                                       

Operating income (loss):

                                                                             
 

Retail

    147.2     10.6 %   123.3     9.5 %   153.1     9.0 %   140.9     8.5 %   106.5     8.7 %       28.2     8.6 %
 

Franchising

    71.3     5.1 %   61.2     4.7 %   80.8     4.7 %   80.8     4.9 %   55.0     4.5 %       14.5     4.4 %
 

Manufacturing/Wholesale

    51.2     3.7 %   54.1     4.2 %   73.5     4.3 %   67.4     4.1 %   38.9     3.2 %       10.3     3.1 %
 

Unallocated corporate and other costs:

                                                                             
   

Warehousing and distribution costs

    (41.5 )   -3.0 %   (40.4 )   -3.1 %   (53.6 )   -3.1 %   (54.2 )   -3.3 %   (40.7 )   -3.3 %       (10.7 )   -3.2 %
   

Corporate costs

    (55.9 )   -4.0 %   (54.9 )   -4.2 %   (72.8 )   -4.3 %   (65.3 )   -3.9 %   (52.8 )   -4.3 %       (26.9 )   -8.2 %
   

Merger related costs

        0.0 %       0.0 %       0.0 %       0.0 %       0.0 %       (34.6 )   -10.5 %
                                                       
 

Subtotal unallocated corporate and other costs, net

    (97.4 )   -7.0 %   (95.3 )   -7.3 %   (126.4 )   -7.4 %   (119.5 )   -7.2 %   (93.5 )   -7.6 %       (72.2 )   -21.9 %

Total Operating income (loss)

    172.3     12.4 %   143.3     11.0 %   181.0     10.6 %   169.6     10.2 %   106.9     8.7 %       (19.2 )   -5.8 %

Interest expense, net

    49.2           53.0           69.9           83.0           75.5               72.8        
                                                                   

Income (loss) before income taxes

    123.1           90.3           111.1           86.6           31.4               (92.0 )      

Income tax expense (benefit)

    45.4           33.4           41.6           32.0           12.6               (21.6 )      
                                                                   

Net income (loss)

  $ 77.7         $ 56.9         $ 69.5         $ 54.6         $ 18.8             $ (70.4 )      
                                                                   

          Note:    The numbers in the above table have been rounded to millions. All calculations related to the Results of Operations for the year-over-year comparisons below were derived from unrounded data and could occasionally differ immaterially if you were to use the table above for these calculations.

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Comparison of the Nine Months Ended September 30, 2010 and 2009

          Our consolidated net revenues increased $83.3 million, or 6.4%, to $1,386.4 million for the nine months ended September 30, 2010 compared to $1,303.1 million for the same period in 2009. The increase was the result of increased sales in our Retail and Franchise segments, partially offset by a decline in sales in our Manufacturing/Wholesale segment.

          Retail.    Revenues in our Retail segment increased $69.3 million, or 7.2%, to $1,031.9 million for the nine months ended September 30, 2010 compared to $962.6 million for the same period in 2009. Domestic retail revenue increased $49.2 million as a result of an increase in our same store sales and $13.2 million from our non-same store sales. Included in the increase from 2009 to 2010 was an increase in sales of $8.5 million through GNC.com. Sales increases occurred primarily in the sports nutrition and vitamin categories. Our domestic company-owned same store sales, including our internet sales, improved by 5.5% for the nine months ended September 30, 2010 compared to the same period in 2009. Canadian retail revenue increased by $6.9 million in U.S. dollars, primarily due to the weakening of the U.S. dollar from 2009 to 2010. In local currency, Canadian retail revenue declined by CAD $1.5 million. This decline was primarily a result of a CAD $3.8 million, or 5%, decline in company-owned same store sales, partially offset by an increase of CAD $2.3 million from our non-same store sales. Our company-owned store base increased by 62 domestic stores to 2,702 at September 30, 2010 compared to 2,640 at September 30, 2009, primarily due to new store openings and franchise store acquisitions, and by three Canadian stores to 169 at September 30, 2010 compared to 166 at September 30, 2009 primarily due to new store openings.

          Franchise.    Revenues in our Franchise segment increased $21.3 million, or 10.6%, to $222.4 million for the nine months ended September 30, 2010 compared to $201.1 million for the same period in 2009. Domestic franchise revenue increased by $5.1 million for the nine months ended September 30, 2010 compared to the same period in 2009 due to increased product sales and franchise fee revenues. Domestic royalty income increased $0.2 million despite operating 22 fewer stores in the first nine months of 2010 compared to the same period in 2009. There were 897 stores at September 30, 2010 compared to 919 stores at September 30, 2009. International franchise revenue increased by $16.2 million for the first nine months of 2010 compared to the same period in 2009 primarily as a result of increases in product sales. International royalty income increased $2.2 million for the first nine months of 2010 as sales increases in our franchisees' respective local currencies were impacted by the weakening of the U.S. dollar from 2009 to 2010. Our international franchise store base increased by 144 stores to 1,401 at September 30, 2010 compared to 1,257 at September 30, 2009.

          Manufacturing/Wholesale.    Revenues in our Manufacturing/Wholesale segment, which includes third-party sales from our manufacturing facility in South Carolina, as well as wholesale sales to Rite Aid, www.drugstore.com and PetSmart, decreased $7.3 million, or 5.2%, to $132.1 million for the nine months ended September 30, 2010 compared to $139.4 million for the same period in 2009. Third party sales decreased in the South Carolina manufacturing plant by $16.8 million. This was partially offset by an increase in wholesale revenue of $9.5 million.

          Consolidated cost of sales, which includes product costs, costs of warehousing and distribution and occupancy costs, increased $44.6 million, or 5.3%, to $893.8 million for the nine months ended September 30, 2010 compared to $849.2 million for the same period in 2009. Consolidated cost of sales, as a percentage of net revenue, was 64.5% and 65.2% for the nine months ended September 30, 2010 and 2009, respectively. Increase in cost of sales was primarily due to higher sales volumes and store counts.

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          Our consolidated SG&A expenses, including compensation and related benefits, advertising and promotion expense, other selling, general and administrative expenses, and amortization expense, increased $9.8 million, or 3.2%, to $320.4 million, for the nine months ended September 30, 2010 compared to $310.6 million for the same period in 2009. These expenses, as a percentage of net revenue, were 23.1% for the nine months ended September 30, 2010 compared to 23.8% for the nine months ended September 30, 2009.

          Compensation and related benefits.    Compensation and related benefits increased $8.4 million, or 4.3%, to $204.7 million for the nine months ended September 30, 2010 compared to $196.3 million for the same period in 2009. Increases occurred in (1) base wages of $6.2 million to support our increased store base and sales volume; (2) health insurance expenses of $1.0 million; (3) incentives, non-cash compensation and severance of $0.9 million; and (4) other compensation expense of $0.3 million.

          Advertising and promotion.    Advertising and promotion expenses increased $0.2 million, or 1.5%, to $40.4 million for the nine months ended September 30, 2010 compared to $40.2 million during the same period in 2009. Advertising expense increased primarily as a result of increases in media costs of $1.0 million and other advertising expenses of $0.6 million, partially offset by decreases in print advertising costs of $2.1 million, and a reduction of vendor marketing income of $0.7 million.

          Other SG&A.    Other SG&A expenses, including amortization expense, increased by $1.2 million, or 1.6%, to $75.3 million for the nine months ended September 30, 2010 compared to $74.1 million for the nine months ended September 30, 2009. Increases in other SG&A included third-party sales commissions of $2.0 million and credit card fees of $1.1 million and other selling expenses of $0.7 million. These were partially offset by decreases in amortization and depreciation expense of $2.0 million and bad debt expense of $0.6 million.

          Foreign currency (gain) loss for the nine months ended September 30, 2010 and 2009 resulted primarily from accounts payable activity with our Canadian subsidiary. We incurred a gain of $0.1 million for the nine months ended September 30, 2010 and an immaterial gain for the nine months ended September 30, 2009.

          As a result of the foregoing, consolidated operating income increased $29.0 million or 20.2% to $172.3 million for the nine months ended September 30, 2010 compared to $143.3 million for the same period in 2009. Operating income, as a percentage of net revenue, was 12.4% for the nine months ended September 30, 2010 and 11.0% for the nine months ended September 30, 2009.

          Retail.    Retail operating income increased $23.9 million, or 19.4%, to $147.2 million for the nine months ended September 30, 2010 compared to $123.3 million for the same period in 2009. The increase was primarily the result of higher dollar margins on increased sales volumes partially offset by increases in occupancy costs, compensation costs and other SG&A expenses.

          Franchise.    Franchise operating income increased $10.1 million, or 16.5%, to $71.3 million for the nine months ended September 30, 2010 compared to $61.2 million for the same period in 2009. This increase was due to increases in royalty income, higher dollar margins on increased product sales to franchisees and reductions in bad debt expenses and amortization expenses, partially offset by approximately $1.1 million of start-up expenses related to our operations in China.

          Manufacturing/Wholesale.    Manufacturing/Wholesale operating income decreased $2.9 million, or 5.4%, to $51.2 million for the nine months ended September 30, 2010 compared to $54.1 million

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for the same period in 2009. This decrease was primarily the result of lower margins from our South Carolina manufacturing facility.

          Warehousing and Distribution Costs.    Unallocated warehousing and distribution costs increased $1.1 million, or 2.4%, to $41.5 million for the nine months ended September 30, 2010 compared to $40.4 million for the same period in 2009. The increase in costs was primarily due to increases in fuel costs.

          Corporate Costs.    Corporate overhead costs increased $1.0 million, or 1.8%, to $55.9 million for the nine months ended September 30, 2010 compared to $54.9 million for the same period in 2009. This decrease was due to decreases in other SG&A expenses partially offset by increases in compensation expenses.

          Interest expense decreased $3.8 million, or 7.2%, to $49.2 million for the nine months ended September 30, 2010 compared to $53.0 million for the same period in 2009. This decrease was primarily attributable to decreases in interest rates on our variable rate debt in 2010 as compared to 2009.

          We recognized $45.4 million (or 36.9% of pre-tax income) of consolidated income tax expense during the nine months ended September 30, 2010 compared to $33.4 million (or 37.0% of pre-tax income) for the same period of 2009.

          As a result of the foregoing, consolidated net income increased $20.8 million to $77.7 million for the nine months ended September 30, 2010 compared to $56.9 million for the same period in 2009.

Comparison of the Years Ended December 31, 2009 and 2008

          Our consolidated net revenues increased $50.3 million, or 3.0%, to $1,707.0 million for the year ended December 31, 2009 compared to $1,656.7 million for the same period in 2008. The increase was the result of increased sales in all of our segments.

          Retail.    Revenues in our Retail segment increased $37.0 million, or 3.0%, to $1,256.3 million for the year ended December 31, 2009 compared to $1,219.3 million for the same period in 2008. The increase from 2008 to 2009 included an increase of $31.6 million in our same store sales and an increase of $5.9 million from our non-same store sales. Included in the same store sales increase is an increase of $10.8 million for sales through GNC.com. Sales increases occurred in the major product categories of VMHS and sports nutrition. Sales in the diet category were negatively impacted by the Hydroxycut recall that occurred in May 2009. Our domestic company-owned same store sales, including our internet sales, improved by 2.8% for the year ended December 31, 2009. For the year ended December 31, 2009, Canadian retail revenue decreased by $0.5 million in U.S. dollars, primarily due to the volatility of the U.S. dollar. In local currency, however, Canadian retail revenue increased by CAD $6.3 million. This increase was primarily a result of an increase of CAD $0.7 million, or 0.8%, in company-owned same store sales, and an increase of CAD $5.6 million from our non-same store sales. Our company-owned store base increased by 51 domestic stores to 2,665 compared to 2,614 at December 31, 2008, primarily due to new store openings and franchise store acquisitions, and by seven Canadian stores to 167 at December 31, 2009 compared to 160 at December 31, 2008, primarily due to new store openings.

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          Franchise.    Revenues in our Franchise segment increased $6.2 million, or 2.4%, to $264.2 million for the year ended December 31, 2009 compared to $258.0 million for the same period in 2008. Domestic franchise revenue decreased by $1.4 million for the year ended December 31, 2009 as increased product sales were more than offset by lower franchise fee revenue. Domestic royalty income was flat despite operating 45 fewer stores during 2009 as compared to 2008. There were 909 stores at December 31, 2009 compared to 954 stores at December 31, 2008. International franchise revenue increased by $7.6 million for the year ended December 31, 2009 as a result of increases in product sales, partially offset by lower franchise fee revenue. International royalty income increased $0.5 million for the 2009 period compared to the 2008 period as sales increases in our franchisees' respective local currencies were impacted by the strengthening of the U.S. dollar from 2008 to 2009. Our international franchise store base increased by 117 stores to 1,307 at December 31, 2009 compared to 1,190 at December 31, 2008.

          Manufacturing/Wholesale.    Revenues in our Manufacturing/Wholesale segment, which includes third-party sales from our manufacturing facility in South Carolina, as well as wholesale sales to Rite Aid and www.drugstore.com, increased $7.1 million, or 4.0%, to $186.5 million for the year ended December 31, 2009 compared to $179.4 million for 2008. Sales increased in the South Carolina plant by $4.4 million, and revenues associated with Rite Aid increased by $1.4 million. This increase was due to increases in wholesale and consignment sales to Rite Aid of $4.6 million, partially offset by lower initial and renewal license fee revenue of $3.2 million as a result of Rite Aid opening 197 fewer store-within-a-stores in 2009 as compared to 2008. In addition, sales to www.drugstore.com increased by $1.3 million in 2009 as compared to 2008.

          Consolidated cost of sales, which includes product costs, costs of warehousing and distribution and occupancy costs, increased $33.8 million, or 3.1%, to $1,116.4 million for the year ended December 31, 2009 compared to $1,082.6 million for the same period in 2008. Consolidated cost of sales, as a percentage of net revenue, was 65.4% for the year ended December 31, 2009 as compared to 65.3% for the year ended December 31, 2008. The increase in cost of sales was due primarily to increased products costs resulting from higher sales volumes and raw material costs and increased occupancy costs resulting from higher depreciation expense and lease-related costs.

          Our consolidated SG&A expenses, including compensation and related benefits, advertising and promotion expense, other selling, general and administrative expenses, and amortization expense, increased $5.9 million, or 1.5%, to $409.7 million, for the year ended December 31, 2009 compared to $403.8 million for the same period in 2008. These expenses, as a percentage of net revenue, were 24.0% for the year ended December 31, 2009 compared to 24.4% for the year ended December 31, 2008.

          Compensation and related benefits.    Compensation and related benefits increased $13.2 million, or 5.3%, to $263.0 million for the year ended December 31, 2009 compared to $249.8 million for the same period in 2008. The increase was due to increases of: (1) $8.5 million in base wages to support our increased store base and sales volume and to comply with the increases in minimum wage rates; (2) $1.4 million in health insurance; (3) $1.2 million in commissions and incentive expense; and (4) other wage related expenditures of $1.0 million. In addition, 2008 expenses included a $1.1 million reduction in base wages due to a change in our vacation policy effective March 31, 2008.

          Advertising and promotion.    Advertising and promotion expenses decreased $5.1 million, or 9.1%, to $50.0 million for the year ended December 31, 2009 compared to $55.1 million during the same period in 2008. Advertising expense decreased primarily as a result of decreases in media costs of $2.3 million and print advertising costs of $3.4 million, partially offset by increases in other advertising costs of $0.6 million.

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          Other SG&A.    Other SG&A expenses, including amortization expense, decreased $2.2 million or 2.3%, to $96.7 million for the year ended December 31, 2009 compared to $98.9 million for the year ended December 31, 2008. Decreases in bad debt expense of $2.3 million, amortization expense of $1.2 million and other selling expenses of $0.3 million were partially offset by increases in telecommunications expenses of $1.9 million due to the installation of a new point of sale ("POS") register system in 2008 and professional fees of $0.8 million. In addition, 2009 other SG&A includes a $1.1 million gain from proceeds received from the Visa/Mastercard antitrust litigation settlement.

          Foreign currency loss/gain for the year ended December 31, 2009 and 2008, resulted primarily from accounts payable activity with our Canadian subsidiary. We recognized income of $0.1 million for the year ended December 31, 2009 and a loss of $0.7 million for the year ended December 31, 2008.

          As a result of the foregoing, consolidated operating income increased $11.4 million or 6.7% to $181.0 million for the year ended December 31, 2009 compared to $169.6 million for the same period in 2008. Operating income, as a percentage of net revenue, was 10.6% for the year ended December 31, 2009 and 10.2% for the year ended December 31, 2008.

          Retail.    Retail operating income increased $12.2 million, or 8.7%, to $153.1 million for the year ended December 31, 2009 compared to $140.9 million for the same period in 2008. The increase was primarily the result of higher dollar margins on increased sales volumes and reduced advertising spending, partially offset by increases in occupancy costs, compensation costs and other SG&A expenses.

          Franchise.    Franchise operating income is unchanged at $80.8 million for each of the years ended December 31, 2009 and 2008.

          Manufacturing/Wholesale.    Manufacturing/Wholesale operating income increased $6.1 million, or 9.0%, to $73.5 million for the year ended December 31, 2009 compared to $67.4 million for the same period in 2008. This increase was primarily the result of increased margins from our South Carolina manufacturing facility, partially offset by decreases in Rite Aid license fee revenue.

          Warehousing and Distribution Costs.    Unallocated warehousing and distribution costs decreased $0.6 million, or 1.3%, to $53.6 million for the year ended December 31, 2009 compared to $54.2 million for the same period in 2008. The decrease was primarily due to decreases in fuel costs.

          Corporate Costs.    Corporate overhead costs increased $7.5 million, or 11.7%, to $72.8 million for the year ended December 31, 2009 compared to $65.3 million for the same period in 2008. The increase was primarily due to an increase in compensation expense and professional fees in 2009. In addition, 2008 compensation expense includes a $1.1 million reduction due to a change in our vacation policy effective March 31, 2008.

          Interest expense decreased $13.1 million, or 15.7%, to $69.9 million for the year ended December 31, 2009 compared to $83.0 million for the same period in 2008. This decrease was primarily attributable to decreases in interest rates on our variable rate debt in 2009 as compared to 2008 and $25.3 million in principal payments during 2009, as compared to $8.0 million in principal payments in 2008.

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          We recognized $41.6 million of income tax expense (or 37.4% of pre-tax income) during the year ended December 31, 2009 compared to $32.0 million (or 36.9% of pre-tax income) for the same period of 2008. For the year ended December 31, 2009, a $0.5 million discrete tax benefit was recorded while a $2.0 million discrete tax benefit was recorded for the year ended December 31, 2008.

          As a result of the foregoing, consolidated net income increased $14.9 million to $69.5 million for the year ended December 31, 2009 compared to $54.6 million for the same period in 2008.

Comparison of the Year Ended December 31, 2008 and the 2007 Successor Period — March 16, 2007 to December 31, 2007

          The following discussion compares the results of operations of the year ended December 31, 2008 to the successor period of March 16, 2007 to December 31, 2007 ("2007 Successor Period"). Our results of operations from period to period may not be comparable because the 2007 Successor Period was only 291 days.

          Our consolidated net revenues increased $433.7 million, or 35.5%, to $1,656.7 million for the year ended December 31, 2008 compared to $1,223.0 million for the 2007 Successor Period, due to increased sales in each of our segments, and a result of comparing a 366 day period to a 291 day period.

          Retail.    Revenues in our Retail segment increased $310.0 million, or 34.1%, to $1,219.3 million for the year ended December 31, 2008 compared to $909.3 million for the 2007 Successor Period. Domestic retail revenue increased by $286.9 million, of which $14.7 million was the result of an increase in our same store sales, and $272.2 million was the result of an increase in our non-same store sales. Such increase is primarily due to the fact that we are comparing a full year to a 291 day period. Included in the increase from the 2007 Successor Period to the year ended December 31, 2008 included an increase of $14.4 million of sales through GNC.com. Sales increases occurred in each of the major product categories of VMHS and sports nutrition. Canadian retail revenue increased by $23.1 million in U.S. dollars, primarily due to the fact that we are comparing a full year to a 291 day period and, to a lesser extent, the volatility of the U.S. dollar. In local currency, Canadian retail revenue increased CAD $25.2 million. This increase was primarily a result of a CAD $4.9 million, or 8.0%, increase in company-owned same store sales, and an increase of CAD $20.3 million from our non-same store sales. Our company-owned store base increased by 16 domestic stores to 2,614 compared to 2,598 at December 31, 2007, primarily due to new store openings and franchise store acquisitions, and by 13 Canadian stores to 160 at December 31, 2008 compared to 147 at December 31, 2007, primarily due to new store openings.

          Franchise.    Revenues in our Franchise segment increased $64.1 million, or 33.1%, to $258.0 million for the year ended December 31, 2008 compared to $193.9 million for the 2007 Successor Period. The increase is primarily due to comparing a 366 day period to a 291 day period. Domestic franchise revenue increased $42.1 million as a result of increased product sales despite operating 24 fewer stores during 2008 compared to 2007. There were 954 stores at December 31, 2008 compared to 978 stores at December 31, 2007. International franchise revenue increased $22.0 million as a result of increased product sales and royalties. Our international franchise store base increased by 112 stores to 1,190 at December 31, 2008 compared to 1,078 at December 31, 2007.

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          Manufacturing/Wholesale.    Revenues in our Manufacturing/Wholesale segment, which includes third-party sales from our manufacturing facilities in South Carolina, as well as wholesale sales to Rite Aid and www.drugstore.com, increased $59.6 million, or 49.7%, to $179.4 million for the year ended December 31, 2008 compared to $119.8 million for the 2007 Successor Period. Sales increased in the South Carolina plant by $46.6 million, and revenues associated with Rite Aid increased by $11.4 million due primarily to increased license fees as a result of Rite Aid opening 401 stores for the year ended December 31, 2008 as opposed to 101 stores for the 2007 Successor Period.

          Consolidated cost of sales, which includes product costs, costs of warehousing and distribution and occupancy costs, increased $268.4 million, or 33.0%, to $1,082.6 million for the year ended December 31, 2008 compared to $814.2 million for the 2007 Successor Period. The increase is primarily due to comparing a 366 day period to a 291 day period. Consolidated cost of sales, as a percent of net revenue, decreased to 65.3% in the year ended December 31, 2008 compared to 66.6% for the 2007 Successor Period. Additionally, product costs in the 2007 Successor Period included $15.5 million in non-cash expense from amortization of inventory step up to fair value due to the Merger. Excluding this non-cash expense, consolidated cost of sales for the 2007 Successor Period was 65.3% of revenue.

          Our consolidated SG&A expenses, including compensation and related benefits, advertising and promotion expense, other selling, general and administrative expenses, and amortization expense increased $101.5 million, or 33.5%, to $403.8 million for the year ended December 31, 2008 compared to $302.3 million for the 2007 Successor Period. The increase is primarily due to comparing a 366 day period to a 291 day period. These expenses, as a percentage of net revenues, were 24.4% for the year ended December 31, 2008 compared to 24.7% for the 2007 Successor Period.

          Compensation and related benefits.    Compensation and related benefits increased $54.0 million, or 27.6%, to $249.8 million for the year ended December 31, 2008 compared to $195.8 million for the 2007 Successor Period. The increase is primarily due to comparing a 366 day period to a 291 day period. Secondarily, full-time and part-time wages increased to support an increased sales volume and store base. Compensation and related benefits, as a percentage of net revenues, was 15.1% for the year ended December 31, 2008 compared to 16.0% for the 2007 Successor Period.

          Advertising and promotion.    Advertising and promotion expenses increased $20.1 million, or 57.3%, to $55.1 million for the year ended December 31, 2008 compared to $35.0 million for the 2007 Successor Period. The increase is primarily due to comparing a 366 day period to a 291 day period. Advertising and promotion costs, as a percentage of net revenues, were 3.3% for the year ended December 31, 2008 compared to 2.9% for the 2007 Successor Period. This increase is primarily attributable to an increase in agency fees and media advertising.

          Other SG&A.    Other SG&A expenses, including amortization expense, increased $27.4 million, or 38.4%, to $98.9 million for the year ended December 31, 2008 compared to $71.5 million for the 2007 Successor Period. Other SG&A expenses, as a percentage of net revenues were 6.0% for the year ended December 31, 2008 compared to 5.8% for the 2007 Successor Period. The increase is due to comparing a 366 day period to a 291 day period. Additionally, the increase is attributable to additional third-party commission expense on higher commission sales, higher telecommunications expense due to the installation of a new POS register system, and higher bad debt expense.

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          Foreign currency loss/gain for the year ended December 31, 2008 and the 2007 Successor Period resulted primarily from accounts payable activity with our Canadian subsidiary. We incurred a loss of $0.7 million for the year ended December 31, 2008 compared to a gain of $0.4 million for the 2007 Successor Period.

          As a result of the foregoing, consolidated operating income increased $62.7 million, or 58.7%, to $169.6 million for the year ended December 31, 2008 compared to $106.9 million for the 2007 Successor Period. Operating income, as a percentage of net revenue, was 10.2% for the year ended December 31, 2008 compared to 8.7% for the 2007 Successor Period.

          Retail.    Retail operating income increased $34.4 million, or 32.4%, to $140.9 million for the year ended December 31, 2008 compared to $106.5 million for the 2007 Successor Period. Included in the 2007 Successor Period was $9.6 million of amortization of inventory and lease step up adjustments as a result of the Merger. The increase in operating income was primarily the result of comparing a 366 day period to a 291 day period. Additionally, higher dollar margins on increased sales volumes and lower operating expenses, as a percentage of revenue, contributed to the increase in operating income.

          Franchise.    Franchise operating income increased $25.8 million, or 46.9%, to $80.8 million for the year ended December 31, 2008 compared to $55.0 million for the 2007 Successor Period. Included in the 2007 Successor Period was $0.1 million of amortization of inventory step up adjustments as a result of the Merger. The increase in operating income was primarily the result of comparing a 366 day period to a 291 day period. Additionally, the increase was due to an increase in margins related to higher wholesale sales to our international and domestic franchisees, offset by increases in intangible amortization as a result of the Merger, and higher bad debt expense.

          Manufacturing/Wholesale.    Manufacturing/Wholesale operating income increased $28.5 million, or 73.1%, to $67.4 million for the year ended December 31, 2008 compared to $38.9 million for the 2007 Successor Period. Included in the 2007 Successor Period was $5.7 million of amortization of inventory step up adjustments as a result of the Merger. The increase in operating income was primarily the result of comparing a 366 day period to a 291 day period. Additionally, the increase in operating income was the result of improved margins on our third-party contract sales and increases in Rite Aid license fee revenue.

          Warehousing and distribution costs.    Unallocated warehousing and distribution costs increased $13.5 million, or 33.3%, to $54.2 million for the year ended December 31, 2008 compared to $40.7 million for the 2007 Successor Period. The increase in costs was primarily the result of comparing a 366 day period to a 291 day period. Additionally, the increase in cost was due to increases in fuel and shipping costs, and an increase in wages incurred in fulfilling orders placed through our internet business.

          Corporate costs.    Corporate costs increased $12.5 million, or 23.7%, to $65.3 million for the year ended December 31, 2008 compared to $52.8 million for the 2007 Successor Period. The increase in costs was primarily the result of comparing a 366 day period to a 291 day period.

          Interest expense increased $7.5 million, or 9.9%, to $83.0 million for the year ended December 31, 2008 compared to $75.5 million for the 2007 Successor Period. This increase is primarily the result of comparing a 366 day period to a 291 day period.

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          We recognized $32.0 million of consolidated income tax expense (or 36.9% of pre-tax income) during the year ended December 31, 2008 compared to $12.6 million (or 39.9% of pre-tax income) for the 2007 Successor Period. The effective tax rate for the year ended December 31, 2008 was approximately 36.9%, which includes discrete tax benefits of $2.0 million. The effective tax rate for the 2007 Successor Period was approximately 39.9%.

          As a result of the foregoing, consolidated net income increased $35.8 million, or 190.5%, to $54.6 million for the year ended December 31, 2008 compared to $18.8 million for the 2007 Successor Period.

2007 Predecessor Period — January 1, 2007 to March 15, 2007

          Because the basic operations of our company did not change as a result of the Merger, there were no significant differences in our financial results of operations and operational trends for the predecessor period of January 1, 2007 to March 15, 2007 (the "2007 Predecessor Period"), except for the following:

          As a result of the additional Merger-related expenses described above, we recognized a $10.7 million tax benefit for the 2007 Predecessor Period.

Liquidity and Capital Resources

          At September 30, 2010, we had $165.2 million in cash and cash equivalents and $489.0 million in working capital, compared with $89.9 million in cash and cash equivalents and $397.0 million in working capital at December 31, 2009. The $92.0 million increase in our working capital was driven by increases in our inventory and cash and a decrease in our accrued interest. This was partially offset by an increase in our accounts payable, accrued payroll and other current liabilities, and a reduction in our prepaid income taxes.

          At December 31, 2009, we had $89.9 million in cash and cash equivalents and $397.0 million in working capital compared with $44.3 million in cash and cash equivalents and $306.8 million in working capital at December 31, 2008. The $90.2 million increase in our working capital was driven by increases in our inventory and cash and a decrease in our accrued interest, accounts payable and current portion of long-term debt. This was partially offset by a decrease in our deferred taxes.

          We expect to fund our operations through internally generated cash and, if necessary, from borrowings under the Revolving Credit Facility. At September 30, 2010, we had $44.7 million available under the Revolving Credit Facility, after giving effect to $9.0 million utilized to secure letters of credit and a $6.3 million commitment from Lehman that we do not expect Lehman will fund.

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          We expect our primary uses of cash in the near future will be for purposes of fulfilling debt service requirements, capital expenditures and working capital requirements. In July 2009, Centers' board of directors declared a $13.6 million dividend to our indirect wholly owned subsidiary, GNC Corporation, with a payment date of August 30, 2009. Those funds were then dividended to and are currently held by us. In March 2010, Centers' board of directors declared and paid a $28.4 million dividend to its direct parent company, GNC Corporation. Those funds were then dividended to and are currently held by us. Each dividend was paid with cash generated from operations.

          We currently anticipate that cash generated from operations, together with amounts available under the Revolving Credit Facility (excluding Lehman's commitment), will be sufficient for the term of the facility, which matures on March 15, 2012, to meet our operating expenses, capital expenditures and debt service obligations as they become due. However, our ability to make scheduled payments of principal on, to pay interest on, or to refinance our debt and to satisfy our other debt obligations will depend on our future operating performance, which will be affected by general economic, financial and other factors beyond our control. We are currently in compliance with our debt covenant reporting and compliance obligations under the Revolving Credit Facility.

          Centers has announced that it intends to enter into, subject to market and other conditions, a financing transaction with certain lenders. Centers currently expects to use the proceeds from the transaction, if consummated, to, among other things, refinance its existing indebtedness.

Cash Provided by Operating Activities

          Cash provided by operating activities was $97.6 million for the nine months ended September 30, 2010 and $77.8 million for the nine months ended September 30, 2009. A primary reason for the increase in cash provided by operating activities was the increase in net income of $20.8 million for the nine months ended September 30, 2010 compared to the nine months ended September 30, 2009. Our inventory increased by $26.1 million in support of the higher sales volumes and purchases for new product introductions. Accounts payable increased by $3.7 million due to the timing of disbursements and related inventory growth. The above were supplemented by an increase in our accrued liabilities and a reduction in our prepaid income taxes.

          For the nine months ended September 30, 2009, our inventory increased by $11.0 million in support of the higher sales volume at our stores. Accounts payable decreased by $21.0 million due to the timing of disbursements; in addition, accrued interest decreased by $9.5 million, a result of the semi-annual interest payments on our Senior Notes and Senior Subordinated Notes. These were offset by increases in our accrued liabilities and accrued income taxes.

          Cash provided by operating activities was $114.0 million, $77.4 million, $92.0 million and ($50.9) million during the years ended December 31, 2009 and 2008, the 2007 Successor Period, and the 2007 Predecessor Period, respectively. The primary reason for the changes in each year was the change in net income between each of the periods and changes in working capital accounts. Net income increased $14.8 million for the year ended December 31, 2009 compared with the same period in 2008. Net income increased $35.8 million for the year ended December 31, 2008 compared with the 2007 Successor Period; however, inventory increases during 2008 offset the increase in net income.

          For the year ended December 31, 2009, inventory increased $15.7 million, as a result of increases in our finished goods and a decrease in our reserves. Accounts payable decreased $28.1 million, primarily due to the timing of disbursements. Accrued liabilities increased by $2.1 million, primarily the result of increased deferred revenue.

          For the year ended December 31, 2008, inventory increased $48.2 million, as a result of increases in our finished goods and work in process inventories. Accounts payable increased $22.1 million, primarily the result of increases in inventory. Accrued liabilities decreased by

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$16.1 million, primarily the result of decreases in accrued payroll related to the timing of the pay with year end.

          For the 2007 Successor Period, inventory increased $6.4 million, as a result of increases in our finished goods and a decrease in our reserves. Franchise notes receivable decreased $2.6 million for the 2007 Successor Period, as a result of payments on existing notes, a reduction in our receivable portfolio, fewer company-financed franchise store openings and more store closings. Accrued liabilities increased by $10.9 million, primarily the result of increases in accrued interest on debt and increases in accrued payroll.

Cash Used in Investing Activities

          We used cash for investing activities of $21.2 million and $22.0 million for the nine months ended September 30, 2010 and 2009, respectively. Capital expenditures, which were primarily for new stores, and improvements to our retail stores and our South Carolina manufacturing facility, were $21.0 million and $20.4 million for the nine months ended September 30, 2010 and 2009, respectively.

          We used cash from investing activities of $42.2 million, $60.4 million, $1,672.2 million, and $6.2 million for the years ended December 31, 2009 and 2008, the 2007 Successor Period, and the 2007 Predecessor Period, respectively. We used cash of $11.3 million, $10.8 million and $1,643.0 million during the years ended December 31, 2009 and 2008, and the 2007 Successor Period, respectively, related to the Merger. Capital expenditures, which were primarily for improvements to our retail stores and our South Carolina manufacturing facility and which represent the majority of our remaining cash used in investing activities, were $28.7 million, $48.7 million, $28.8 million and $5.7 million, during the years ended December 31, 2009 and 2008, the 2007 Successor Period, and the 2007 Predecessor Period, respectively. In 2008, we invested $1.0 million in the purchase of certain intangible assets from a third party.

          Our capital expenditures typically consist of certain periodic updates in our company-owned stores and ongoing upgrades and improvements to our manufacturing facilities.

          Capital expenditures for the 2010 fiscal year are projected to be approximately $32 to $34 million. In each of 2011 and 2012, we expect our capital expenditures to range between $40 and $50 million, which includes costs associated with growing our domestic square footage. We anticipate funding our 2011 capital requirements with cash flows from operations and, if necessary, borrowings under our Senior Credit Facility.

Cash Used in Financing Activities

          For the nine months ended September 30, 2010, we used cash of $1.1 million primarily for payments of $1.3 million on long-term debt, including $0.2 million for an excess cash payment on the Term Loan in March 2010 under the requirements of the Senior Credit Facility offset by cash we received of $0.2 million in payments for stock issuances.

          We used cash from financing activities of $21.1 million for the nine months ended September 30, 2009 primarily for long-term debt payments, as described below.

          We used cash of $20.0 million in 2009 for payments on long-term debt, including $3.8 million for an excess cash payment in March 2009 under the requirements of the Senior Credit Facility. In addition, we repaid the outstanding $5.4 million balance on the Revolving Credit Facility in May 2009 and made $14.0 million in optional repayments on the Term Loan Facility ($9.0 million in June 2009 and $5.0 million in December 2009).

          We used cash from financing activities of $8.0 million in 2008 for required payments on long term debt and received $5.4 million from borrowings on the Revolving Credit Facility.

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          We received cash from financing activities of $1,598.7 million in the 2007 Successor Period. The primary sources of this cash were: (1) proceeds from the issuance of the Senior Notes and Senior Subordinated Notes, (2) borrowings under the Senior Credit Facility, and (3) issuance of our preferred and common stock in connection with the Merger.

          The following is a summary of our debt:

          $735.0 Million Senior Credit Facility.    The Senior Credit Facility consists of the $675.0 million Term Loan Facility and the $60.0 million Revolving Credit Facility. As of September 30, 2010, $9.0 million of the Revolving Credit Facility were pledged to secure letters of credit. As of December 31, 2009 and 2008, $7.9 million and $6.2 million was pledged to secure letters of credit, respectively. The Term Loan Facility will mature in September 2013. The Revolving Credit Facility will mature in March 2012. The Senior Credit Facility permits us to prepay a portion or all of the outstanding balance without incurring penalties (except LIBOR breakage costs). Subject to certain exceptions, the Senior Credit Facility requires that 100% of the net cash proceeds from certain asset sales, casualty insurance, condemnations and debt issuances, and, commencing in fiscal 2008, a specified percentage (ranging from 50% to 0% based on a defined leverage ratio) of excess cash flow (as defined in the agreement) for each fiscal year must be used to pay down outstanding borrowings. GNC Corporation, our indirect wholly owned subsidiary, and Centers' existing and future indirect domestic subsidiaries have guaranteed Centers' obligations under the Senior Credit Facility. In addition, the Senior Credit Facility is collateralized by first priority pledges (subject to permitted liens) of Centers' equity interests and the equity interests of Centers' domestic subsidiaries.

          All borrowings under the Senior Credit Facility bear interest, at our option, at a rate per annum equal to (i) the higher of (x) the prime rate (as publicly announced by JPMorgan Chase Bank, N.A. as its prime rate in effect) and (y) the federal funds effective rate, plus 0.50% per annum plus, at December 31, 2008, in each case, applicable margins of 1.25% per annum for the Term Loan Facility and 1.0% per annum for the Revolving Credit Facility or (ii) adjusted LIBOR plus 2.25% per annum for the term loan facility and 2.0% per annum for the revolving credit facility. In addition to paying interest on outstanding principal under the Senior Credit Facility, we are required to pay a commitment fee to the lenders under the Revolving Credit Facility in respect of unutilized revolving loan commitments at a rate of 0.50% per annum.

          The Senior Credit Facility contains customary covenants, including incurrence covenants and certain other limitations on the ability of GNC Corporation, Centers, and Centers' subsidiaries to incur additional debt, guarantee other obligations, grant liens on assets, make investments or acquisitions, dispose of assets, make optional payments or modifications of other debt instruments, pay dividends or other payments on capital stock, engage in mergers or consolidations, enter into sale and leaseback transactions, enter into arrangements that restrict our and our subsidiaries' ability to pay dividends or grant liens, engage in transactions with affiliates, and change the passive holding company status of GNC Corporation.

          The Senior Credit Facility contains events of default, including (subject to customary cure periods and materiality thresholds) defaults based on (1) the failure to make payments under the Senior Credit Facility when due, (2) breaches of covenants, (3) inaccuracies of representations and warranties, (4) cross-defaults to other material indebtedness, (5) bankruptcy events, (6) material judgments, (7) certain matters arising under the Employee Retirement Income Security Act of 1974, as amended, (8) the actual or asserted invalidity of documents relating to any guarantee or security document, (9) the actual or asserted invalidity of any subordination terms supporting the Senior Credit Facility, and (10) the occurrence of a change in control. If any such event of default occurs, the lenders would be entitled to accelerate the facilities and take various other actions, including all actions permitted to be taken by a collateralized creditor. If certain bankruptcy events occur, the facilities will automatically accelerate.

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          Senior Toggle Notes.    In connection with the Merger, Centers completed a private offering of $300.0 million of its Senior Notes. Interest on the Senior Notes is payable semi-annually in arrears on March 15 and September 15 of each year. Interest on the Senior Notes accrues at a variable rate and was 5.8% at September 30, 2010. The Senior Notes are Centers' senior non-collateralized obligations and are effectively subordinated to all of Centers' existing and future collateralized debt, including the Senior Credit Facility, to the extent of the assets securing such debt, rank equally with all of Centers' existing and future non-collateralized senior debt and rank senior to all Centers' existing and future senior subordinated debt, including the Senior Subordinated Notes. The Senior Notes are guaranteed on a senior non-collateralized basis by each of Centers' existing and future domestic subsidiaries (as defined in the Senior Notes indenture). If Centers fails to make payments on the Senior Notes, the notes guarantors must make them instead.

          Centers may elect in its sole discretion to pay interest on the Senior Notes in cash, entirely by increasing the principal amount of the Senior Notes or issuing Senior Notes ("PIK interest"), or on 50% of the outstanding principal amount of the Senior Notes in cash and on 50% of the outstanding principal amount of the Senior Notes by increasing the principal amount of the Senior Notes or by issuing Senior Notes ("partial PIK interest"). Cash interest on the Senior Notes accrues at six-month LIBOR plus 4.5% per annum, and PIK interest, if any, accrues at six-month LIBOR plus 5.25% per annum. If Centers elects to pay PIK interest or partial PIK interest, it will increase the principal amount of the Senior Notes or issue Senior Notes in an aggregate principal amount equal to the amount of PIK interest for the applicable interest payment period (rounded up to the nearest $1,000) to holders of the Senior Notes on the relevant record date. To date, Centers has elected to pay cash interest. The Senior Notes are treated as having been issued with original issue discount for United States federal income tax purposes.

          Centers may redeem some or all of the Senior Notes at any time, at specified redemption prices. If Centers experiences certain kinds of changes in control, Centers must offer to purchase the Senior Notes at 101% of par plus accrued interest to the purchase date.

          The Senior Notes indenture contains certain limitations and restrictions on Centers' and its restricted subsidiaries' ability to incur additional debt beyond certain levels, pay dividends, redeem or repurchase our stock or subordinated indebtedness or make other distributions, dispose of assets, grant liens on assets, make investments or acquisitions, engage in mergers or consolidations, enter into arrangements that restrict our ability to pay dividends or grant liens, and engage in transactions with affiliates. In addition, the Senior Notes indenture restricts Centers' and certain of its subsidiaries' ability to declare or pay dividends to our or their stockholders.

          10.75% Senior Subordinated Notes.    In connection with the Merger, Centers completed a private offering of $110.0 million of Centers' Senior Subordinated Notes. The Senior Subordinated Notes are Centers' senior subordinated non-collateralized obligations and are subordinated to all its existing and future senior debt, including Centers' Senior Credit Facility and the Senior Notes and rank equally with all of Centers' existing and future senior subordinated debt and rank senior to all Centers' existing and future subordinated debt. The Senior Subordinated Notes are guaranteed on a senior subordinated non-collateralized basis by each of Centers' existing and future domestic subsidiaries (as defined in the Senior Subordinated Notes indenture). If Centers fails to make payments on the Senior Subordinated Notes, the notes guarantors must make them instead. Interest on the Senior Subordinated Notes accrues at the rate of 10.75% per year from March 16, 2007 and is payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2007.

          Centers may redeem some or all of the Senior Subordinated Notes at any time, at specified redemption prices. If Centers experiences certain kinds of changes in control, Centers must offer to purchase the Senior Subordinated Notes at 101% of par plus accrued interest to the purchase date.

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          The Senior Subordinated Notes indenture contains certain limitations and restrictions on Centers' and its restricted subsidiaries' ability to incur additional debt beyond certain levels, pay dividends, redeem or repurchase our stock or subordinated indebtedness or make other distributions, dispose of assets, grant liens on assets, make investments or acquisitions, engage in mergers or consolidations, enter into arrangements that restrict Centers' ability to pay dividends or grant liens, and engage in transactions with affiliates. In addition, the Senior Subordinated Notes indenture restricts Centers' and certain of its subsidiaries' ability to declare or pay dividends to our stockholders.

          Proposed Refinancing.    Centers has announced that it intends to enter into, subject to market and other conditions, a financing transaction with certain lenders. Centers currently expects to use the proceeds from the transaction, if consummated, to, among other things, refinance its existing indebtedness.

Contractual Obligations

          The following table summarizes our future minimum non-cancelable contractual obligations at December 31, 2009.

 
  Payments due by period  
 
 
Total
 
Less than
1 year
 
1-3 years
 
4-5 years
 
After 5 years
 
 
  (in millions)
 

Long-term debt obligations(1)

  $ 1,061.8   $ 1.5   $ 11.7   $ 938.6   $ 110.0  

Scheduled interest payments(2)

    221.4     61.3     101.4     56.3     2.4  

Operating lease obligations(3)

    426.7     106.5     154.6     85.0     80.6  

Purchase commitments(4)(5)

    20.6     9.0     5.1     3.1     3.4  
                       

  $ 1,730.5   $ 178.3   $ 272.8   $ 1,083.0   $ 196.4  
                       

(1)
These balances consist of the following debt obligations: (a) $644.6 million for the Senior Credit Facility based on a variable interest rate; (b) $300.0 million for Centers' Senior Notes based on a variable interest rate; (c) $110.0 million for Centers' Senior Subordinated Notes with a fixed interest rate; and (d) $7.2 million for Centers' mortgage with a fixed interest rate. Repayment of the Senior Credit Facility is based on the current amortization schedule and does not take into account any unscheduled payments that may occur due to our future cash positions.

(2)
The interest that will accrue on the long-term obligations includes variable rate payments, which are estimated using the associated LIBOR index as of December 31, 2009. The Senior Credit Facility uses the three month LIBOR index while Centers' Senior Notes uses the six month LIBOR index. Also included in the scheduled interest payments is the activity associated with our interest rate swap agreements which also use the three month LIBOR index and the six month LIBOR index.

(3)
These balances consist of the following operating leases: (a) $407.3 million for company-owned retail stores; (b) $62.4 million for franchise retail stores, which is offset by $62.4 million of sublease income from franchisees; and (c) $19.4 million relating to various leases for tractors/trailers, warehouses, automobiles, and various equipment at our facilities. Operating lease obligations exclude insurance, taxes, maintenance, percentage rent, and other costs. These amounts are subject to fluctuation from year to year. For each of the years ended December 31, 2008 and 2009, respectively, these amounts collectively represented approximately 36% of the aggregate costs associated with our company-owned retail store operating leases.

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(4)
These balances consist of $6.8 million of advertising, $0.5 million in inventory commitments, $2.5 million of required spending for website redesign and $10.8 million related to the ACOF Management Services Agreement and Class B common stock. See "Certain Relationships and Related Transactions — ACOF Management Services Agreement" and "— Special Dividend".

(5)
We are unable to make a reasonably reliable estimate as to when cash settlement with taxing authorities may occur for our unrecognized tax benefits. Also, certain other long term liabilities, included in our consolidated balance sheet relate principally to the fair value of our interest rate swap agreement, and rent escalation liabilities, and we are unable to estimate the timing of these payments. Therefore, these long term liabilities are not included in the table above. See Note 5, "Income Taxes", and Note 13, "Other Long Term Liabilities", to our audited consolidated financial statements for additional information.

          Centers has announced that it intends to enter into, subject to market and other conditions, a financing transaction with certain lenders. Centers currently expects to use the proceeds from the transaction, if consummated, to, among other things, refinance its existing indebtedness.

          In addition to the obligations set forth in the table above, we have entered into employment agreements with certain executives that provide for compensation and certain other benefits. Under certain circumstances, including a change of control, some of these agreements provide for severance or other payments, if those circumstances would ever occur during the term of the employment agreement.

Off Balance Sheet Arrangements

          As of September 30, 2010 and September 30, 2009 and December 31, 2009 and 2008, we had no relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off balance sheet arrangements, or other contractually narrow or limited purposes. We are, therefore, not materially exposed to any financing, liquidity, market, or credit risk that could arise if we had engaged in such relationships.

          We had a balance of unused barter credits on account with a third-party barter agency, which were generated by exchanging inventory with a third-party barter vendor. In exchange, the barter vendor supplied us with barter credits. We did not record a sale on the transaction as the inventory sold was for expiring products that were previously fully reserved for on our balance sheet. In accordance with the standard on nonmonetary transactions, a sale is recorded based on either the value given up or the value received, whichever is more easily determinable. The value of the inventory was determined to be zero, as the inventory was fully reserved. Therefore, these credits were not recognized on the balance sheet and would only have been realized if we purchased services or products through the bartering company. We did not use the barter credits, which expired as of March 31, 2009.

Quantitative and Qualitative Disclosures About Market Risk

          Market risk represents the risk of changes in the value of market risk sensitive instruments caused by fluctuations in interest rates, foreign exchange rates and commodity prices. Changes in these factors could cause fluctuations in the results of our operations and cash flows. In the ordinary course of business, we are primarily exposed to foreign currency and interest rate risks. We do not use derivative financial instruments in connection with these commodity market risks.

          We are exposed to market risks from interest rate changes on Centers' variable rate debt. Although changes in interest rates do not impact our operating income, the changes could affect the fair value of our interest rate swaps and interest payments. As of December 31, 2009, Centers had fixed rate debt of $117.2 million and variable rate debt of $942.6 million. In conjunction with the

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Merger, Centers entered into interest rate swaps, effective April 2, 2007, which effectively convert a portion of the variable LIBOR component of the effective interest rate on two $150.0 million notional portions of Centers' debt under the Term Loan Facility to a fixed rate over a specified term. Each of these $150.0 million notional amounts has a three month LIBOR tranche conforming to the interest payment dates on the Term Loan Facility. During September 2008, Centers entered into two new forward agreements with start dates of the expiration dates of the pre-existing interest rate swap agreements (April 2009 and April 2010). In September 2008, Centers also entered into a new interest rate swap agreement with an effective date of September 30, 2008 that effectively converted an additional notional amount of $100.0 million of debt from a floating to a fixed interest rate. The $100.0 million notional amount has a three month LIBOR tranche conforming to the interest payment dates on the Term Loan Facility. In June 2009, Centers entered into a new swap agreement with an effective date of September 15, 2009. The $150.0 million notional amount has a six month LIBOR tranche conforming to the interest payment dates on the Senior Notes.

          These agreements are summarized in the following table:

Derivative
 
Total Notional Amount
 
Term
 
Counterparty Pays
 
Company Pays
 
 

Interest Rate Swap

  $150.0 million     April 2007-April 2010     3 month LIBOR     4.90 %
 

Interest Rate Swap

  $150.0 million     April 2009-April 2011     3 month LIBOR     3.07 %

Forward Interest Rate Swap

  $150.0 million     April 2010-April 2011     3 month LIBOR     3.41 %
 

Interest Rate Swap

  $100.0 million     September 2008-September 2011     3 month LIBOR     3.31 %
 

Interest Rate Swap

  $150.0 million     September 2009-September 2012     6 month LIBOR     2.68 %

          Based on Centers' variable rate debt balance as of December 31, 2009, a 1% change in interest rates would increase or decrease our annual interest cost by $3.9 million.

Foreign Exchange Rate Market Risk

          We are subject to the risk of foreign currency exchange rate changes in the conversion from local currencies to the U.S. dollar of the reported financial position and operating results of our non-U.S. based subsidiaries. We are also subject to foreign currency exchange rate changes for purchases of goods and services that are denominated in currencies other than the U.S. dollar. The primary currency to which we are exposed to fluctuations is the Canadian Dollar. The fair value of our net foreign investments and our foreign denominated payables would not be materially affected by a 10% adverse change in foreign currency exchange rates for the periods presented.

Interest Rate Market Risk

          A portion of Centers' debt is subject to changing interest rates. Although changes in interest rates do not impact our operating income, the changes could affect the fair value of such debt and related interest payments. As of September 30, 2010, we, through our subsidiaries, had fixed rate debt of $116.1 million and variable rate debt of $942.6 million. Based on our variable rate debt balance as of September 30, 2010, a 1.0% change in interest rates would increase or decrease our annual interest cost by $3.9 million.

          For the nine months ended September 30, 2010, there have been no material changes to our market risks disclosed above.

Effect of Inflation

          Inflation generally affects us by increasing costs of raw materials, labor, and equipment. We do not believe that inflation had any material effect on our results of operations in the periods presented in our consolidated financial statements.

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Critical Accounting Estimates

          You should review the significant accounting policies described in the notes to our consolidated financial statements under the heading "Basis of Presentation and Summary of Significant Accounting Policies" included in this prospectus.

Use of Estimates

          Certain amounts in our financial statements require management to use estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Our accounting policies are described in the notes to our consolidated financial statements under the heading "Basis of Presentation and Summary of Significant Accounting Policies" included elsewhere in this prospectus. Our critical accounting policies and estimates are described in this section. An accounting estimate is considered critical if:

Management believes that the accounting estimates used are appropriate and the resulting balances are reasonable. However, actual results could differ from the original estimates, requiring adjustments to these balances in future periods.

Revenue Recognition

          We operate primarily as a retailer, through company-owned stores, franchise stores, and to a lesser extent, as a wholesaler. On December 28, 2005, we started recognizing revenue through product sales on our website, GNC.com. We apply the provisions of the standard on revenue recognition, which requires the following:

          We recognize revenues in our Retail segment at the moment a sale to a customer is recorded. Gross revenues are reduced by actual customer returns and a provision for estimated future customer returns, which is based on management's estimates after a review of historical customer returns. These estimates are based on historical sales return data, applied to current period sales subject to returns provisions per our company policy. Our customer returns allowance was $2.4 million and $2.6 million at December 31, 2009 and December 31, 2008, respectively. The impact of customer returns on revenue was immaterial for each of the years ended December 31, 2009, December 31, 2008, the 2007 Successor Period, and the 2007 Predecessor Period. We recognize revenues on product sales to franchisees and other third parties when the risk of loss, title and insurable risks have transferred to the franchisee or third-party. We recognize revenues from franchise fees at the time a franchise store opens or at the time of franchise renewal or transfer, as applicable.

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Inventories

          Where necessary, we provide estimated allowances to adjust the carrying value of our inventory to the lower of cost or net realizable value. These estimates require us to make approximations about the future demand for our products in order to categorize the status of such inventory items as slow moving, obsolete, or in excess of need. These future estimates are subject to the ongoing accuracy of management's forecasts of market conditions, industry trends, and competition. While we make estimates of future demand based on historical experience, current expectations and assumptions that we believe are reasonable, if actual demand or market conditions differ from these expectations and assumptions, actual results could differ from our estimates. We are also subject to volatile changes in specific product demand as a result of unfavorable publicity, government regulation, and rapid changes in demand for new and improved products or services. Our inventory allowance for obsolescence and shrinkage was $9.6 million and $10.4 million at December 31, 2009 and December 31, 2008, respectively. This allowance represented 2.5% and 2.8% of our gross inventory value at each period, respectively. The change in the allowance from period to period is primarily the result of gross inventory fluctuations and management of inventory movement throughout our systems. The impact on cost of goods sold as a result of these allowances was immaterial for each of the years ended December 31, 2009, December 31, 2008, the 2007 Successor Period, and the 2007 Predecessor Period.

Accounts Receivable and Allowance for Doubtful Accounts

          The majority of our retail revenues are received as cash or cash equivalents. The majority of our franchise revenues are billed to the franchisees with varying terms for payment. We offer financing to qualified domestic franchisees with the initial purchase of a franchise location. The notes are demand notes, payable monthly over periods of five to seven years. We generate a significant portion of our revenue from ongoing product sales to franchisees and third-party customers. An allowance for doubtful accounts is established based on regular evaluations of our franchisees' and third-party customers' financial health, the current status of trade receivables, and any historical write-off experience. We maintain both specific and general reserves for doubtful accounts. General reserves are based upon our historical bad debt experience, overall review of our aging of accounts receivable balances, general economic conditions of our industry, or the geographical regions and regulatory environments of our third-party customers and franchisees. Management's estimates of the franchisees' financial health include forecasts of the customers' and franchisees' future operating results and the collectability of receivables from them. While we believe that our business operations and communication with customers and franchisees allows us to make reasonable estimates of their financial health, actual results could differ from those predicted by management, and actual bad debt expense could differ from forecasted results. Our allowance for doubtful accounts was $1.8 million and $4.1 million at December 31, 2009 and December 31, 2008, respectively. Changes in the allowance from period to period are primarily a result of the composition of customers and their financial health. Bad debt expense was immaterial for each of the years ended December 31, 2009, December 31, 2008, the 2007 Successor Period, and the 2007 Predecessor Period.

Impairment of Long-Lived Assets

          Long-lived assets, including fixed assets and intangible assets with finite useful lives, are evaluated periodically by us for impairment whenever events or changes in circumstances indicate that the carrying amount of any such asset may not be recoverable. If the sum of the undiscounted future cash flows is less than the carrying value, we recognize an impairment loss, measured as the amount by which the carrying value exceeds the fair value of the asset. These estimates of cash flow require significant management judgment and certain assumptions about future volume, revenue and expense growth rates, foreign exchange rates, devaluation and inflation. While we

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make estimates based on historical experience, current expectations and assumptions that we believe are reasonable, if actual results, including future cash flows, differ from our estimates, our estimates may differ from actual impairment recognized. There has been no impairment recorded in the years ended December 31, 2009, December 31, 2008, the 2007 Successor Period and the 2007 Predecessor Period.

Self-Insurance

          We have procured insurance for such areas as: (1) general liability; (2) product liability; (3) directors and officers liability; (4) property insurance; and (5) ocean marine insurance. We are self-insured for such areas as: (1) medical benefits; (2) workers' compensation coverage in the State of New York with a stop loss of $250,000; (3) physical damage to our tractors, trailers and fleet vehicles for field personnel use; and (4) physical damages that may occur at the corporate store locations. We are not insured for certain property and casualty risks due to the frequency and severity of a loss, the cost of insurance and the overall risk analysis. Our associated liability for this self-insurance was not significant as of December 31, 2009 and 2008. Prior to 2003, General Nutrition Companies, Inc. was included as an insured under several of its then ultimate parent's global insurance policies.

          We carry product liability insurance with a retention of $3.0 million per claim with an aggregate cap on retained losses of $10.0 million. We carry general liability insurance with retention of $110,000 per claim with an aggregate cap on retained losses of $600,000. The majority of our workers' compensation and auto insurance are in a deductible/retrospective plan. We reimburse the insurance company for the workers' compensation and auto liability claims, subject to a $250,000 and $100,000 loss limit per claim, respectively.

          As part of the medical benefits program, we contract with national service providers to provide benefits to our employees for all medical, dental, vision and prescription drug services. We then reimburse these service providers as claims are processed from our employees. We maintain a specific stop loss provision of $250,000 per incident with a maximum limit up to $2.0 million per participant, per benefit year, respectively. We have no additional liability once a participant exceeds the $2.0 million ceiling. We utilize a review of historical claims, including the timing of claims reported versus payment of claims, to estimate future liabilities related to our medical benefit program. While we make these estimates based on historical experience, current expectations and assumptions that we believe are reasonable, actual results could differ from our estimates. Our liability for medical claims is included as a component of accrued benefits as described in Note 10, "Accrued Payroll and Related Liabilities", to our audited consolidated financial statements included elsewhere in this prospectus, and was $2.0 million and $2.2 million as of December 31, 2009 and 2008, respectively.

Goodwill and Indefinite-Lived Intangible Assets

          On an annual basis, we perform a valuation of the goodwill and indefinite lived intangible assets associated with our operating segments. To the extent that the fair value associated with the goodwill and indefinite-lived intangible assets is less than the recorded value, we write down the value of the asset. The valuation of the goodwill and indefinite-lived intangible assets is affected by, among other things, our business plan for the future, and estimated results of future operations. Changes in the business plan or operating results that are different than the estimates used to develop the valuation of the assets may result in an impact on their valuation. While we make these estimates based on historical experience, current expectations and assumptions that we believe are reasonable, if actual results, including future operating results, differ from our estimates, our estimates may differ from actual impairment recognized.

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          We conduct impairment testing annually at the beginning of the fourth quarter, using third quarter results. Historically, we have recognized impairments to our goodwill and intangible assets based on declining financial results and market conditions. The most recent valuation was performed at October 1, 2009, and no impairment was found. There was also no impairment found during 2009 or 2008. See Note 4, "Goodwill and Intangible Assets", to our audited consolidated financial statements included elsewhere in this prospectus. We do not currently expect to incur additional impairment charges in the foreseeable future; however, the risks relating to our business, as described above under "Risk Factors", could have a negative effect on our business and operating results which could affect the valuation of our intangibles.

Leases

          We have various operating leases for company-owned and franchise store locations and equipment. Store leases generally include amounts relating to base rental, percent rent and other charges such as common area maintenance fees and real estate taxes. Periodically, we receive varying amounts of reimbursements from landlords to compensate us for costs incurred in the construction of stores. We amortize these reimbursements as an offset to rent expense over the life of the related lease. We determine the period used for the straight-line rent expense for leases with option periods and conform it to the term used for amortizing improvements.

Income Taxes

          We compute our annual tax rate based on the statutory tax rates and tax planning opportunities available to us in the various jurisdictions in which we earn income. Significant judgment is required in determining our annual tax rate and in evaluating uncertainty in our tax positions. We recognize a benefit for tax positions that we believe will more likely than not be sustained upon examination. The amount of benefit recognized is the largest amount of benefit that we believe has more than a 50% probability of being realized upon settlement. We regularly monitor our tax positions and adjust the amount of recognized tax benefit based on our evaluation of information that has become available since the end of our last financial reporting period. The annual tax rate includes the impact of these changes in recognized tax benefits. The difference between the amount of benefit taken or expected to be taken in a tax return and the amount of benefit recognized for financial reporting represents unrecognized tax benefits. These unrecognized tax benefits are presented in the balance sheet principally within accrued income taxes.

          We record valuation allowances to reduce deferred tax assets to the amount that is more likely than not to be realized. When assessing the need for valuation allowances, we consider future taxable income and ongoing prudent and feasible tax planning strategies. Should a change in circumstances lead to a change in judgment about the realizability of deferred tax assets in future years, we would adjust related valuation allowances in the period that the change in circumstances occurs, along with a corresponding increase or charge to income.

Recently Issued Accounting Pronouncements

          In June 2009, the Financial Accounting Standards Board (the "FASB") issued a standard on Generally Accepted Accounting Principles. This standard establishes the FASB Accounting Standards Codification (the "Codification") as the single source of U.S. GAAP. The Codification is effective for interim and annual periods ending after September 15, 2009. The adoption of this standard did not have any impact on our financial statements.

          In June 2009, the SEC issued a staff accounting bulletin ("SAB") that revises or rescinds portions of the interpretive guidance included in the codification of SABs in order to make the interpretive guidance consistent with U.S. GAAP. The principal revisions include deletion of material no longer necessary or that has been superseded because of the issuance of new standards. We

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adopted this SAB during the second quarter of 2009; the adoption did not have any impact on our consolidated financial statements.

          In September 2006, the FASB issued new standards on fair value measurements and disclosures. These new standards define fair value, establish a framework for measuring fair value in accordance with U.S. GAAP, and expand disclosures about fair value measurements. The new standard applies under other accounting pronouncements that require or permit fair value measurements and, accordingly, does not require any new fair value measurements. The original standard was initially effective as of January 1, 2008, but in February 2008 the FASB delayed the effectiveness date for applying this standard to nonfinancial assets and nonfinancial liabilities that are not currently recognized or disclosed at fair value in the financial statements. The standard was effective for fiscal years beginning after November 15, 2007, except for nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis, for which application has been deferred for one year. We adopted this new standard in the first quarter of fiscal 2008 for financial assets and liabilities. See Note 23, "Fair Value Measurements", to our audited consolidated financial statements included in this prospectus. We evaluated the impact of the standard on the valuation of all nonfinancial assets and liabilities, including those measured at fair value in goodwill, brands, and indefinite lived intangible asset impairment testing.

          In March 2008, the FASB issued a new standard on derivatives and hedging. The new standard requires companies with derivative instruments to disclose information that should enable financial statement users to understand how and why a company uses derivative instruments, how derivative instruments and related hedged items are accounted for and how derivative instruments and related hedged items affect a company's financial position, financial performance, and cash flows. The new standard was effective for interim and annual periods beginning on or after November 15, 2008. We adopted this new standard during the first quarter of 2009. See Note 2, "Basis of Presentation and Summary of Significant Accounting Policies" to our audited consolidated financial statements.

          In May 2009, the FASB issued a standard on subsequent events which establishes general standards of accounting for and disclosing of events that occur after the balance sheet date but before financial statements are issued or are available to be issued. The intent of this standard is to incorporate accounting guidance that originated as auditing standards into the body of authoritative literature issued by the FASB which is consistent with the FASB's objective to codify all authoritative U.S. accounting guidance related to a particular topic in one place. We adopted this standard during the second quarter of 2009. See Note 27, "Subsequent Events", to our audited consolidated financial statements.

Management's Report on Internal Control Over Financial Reporting

          Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures specified in Rule 13a-15(f)(1)-(3) of the Exchange Act. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

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          Our management with the participation of our Chief Executive Officer and Chief Financial Officer, has assessed the effectiveness of our internal control over financial reporting based on the framework and criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, our management has concluded that, as of December 31, 2009, our internal control over financial reporting was effective based on that framework.

          Our independent registered public accounting firm, PricewaterhouseCoopers LLP, has audited the effectiveness of our internal control over financial reporting as of December 31, 2009, as stated in their report, which is included within this prospectus.

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BUSINESS

Our Company

          Based on our worldwide network of more than 7,100 locations and our GNC.com website, we believe we are the leading global specialty retailer of health and wellness products, including VMHS products, sports nutrition products, and diet products. Our diversified, multi-channel business model derives revenue from product sales through domestic company-owned retail stores, domestic and international franchise activities, third-party contract manufacturing, e-commerce and corporate partnerships. We believe that the strength of our GNC brand, which is distinctively associated with health and wellness, combined with our stores and website, give us broad access to consumers and uniquely position us to benefit from the favorable trends driving growth in the nutritional supplements industry and the broader health and wellness sector. Our broad and deep product mix, which is focused on high-margin, premium, value-added nutritional products, is sold under our GNC proprietary brands, including Mega Men®, Ultra Mega®, GNC WELLbeING®, Pro Performance® and Pro Performance® AMP, and under nationally recognized third-party brands.

          Our domestic retail network, which, based on information we compiled from the public securities filings of our primary competitors, is approximately twelve times larger than the next largest U.S. specialty retailer of nutritional supplements, provides a leading platform for our vendors to distribute their products to their target consumer. Our close relationship with our vendor partners often enables us to negotiate preferred distribution rights for our retail locations. In addition, our in-house product development capabilities enable us to offer our customers proprietary merchandise that can only be purchased through our locations or on our website. As the nutritional supplement consumer often requires knowledgeable customer service, we also differentiate ourselves from mass and drug retailers with our well-trained sales associates who are aided by in-store technology. We believe that our expansive retail network, differentiated merchandise offering and quality customer service result in a unique shopping experience that is distinct from our competitors.

          We have grown our consolidated revenues from $1,317.7 million in 2005 to $1,707.0 million in 2009, representing a compound annual growth rate ("CAGR") of 6.7%. We have achieved domestic company-owned retail same store sales growth for 21 consecutive quarters. EBITDA has grown from $113.2 million in 2005 to $227.7 million in 2009, representing a CAGR of 19.1%. EBITDA as a percentage of revenue has increased 470 basis points from 8.6% in 2005 to 13.3% in 2009. For a reconciliation of EBITDA to net income see "Selected Consolidated Financial Data".

Corporate History

          We are a holding company and all of our operations are conducted through our operating subsidiaries.

          Together with our wholly owned subsidiary GNC Acquisition Inc., we entered into the Merger Agreement with GNC Parent Corporation on February 8, 2007. On March 16, 2007, the Merger was consummated. Pursuant to the Merger Agreement, as amended, GNC Acquisition Inc. was merged with and into GNC Parent Corporation, with GNC Parent Corporation as the surviving corporation. Subsequently on March 16, 2007, GNC Parent Corporation was converted into a Delaware limited liability company and renamed GNC Parent LLC.

          As a result of the Merger, we became the sole equity holder of GNC Parent LLC and the ultimate parent company of both GNC Corporation and Centers. Our outstanding capital stock is beneficially owned by Ares and OTPP, certain institutional investors, certain of our directors, and certain former stockholders of GNC Parent Corporation, including members of our management. Refer to "Principal and Selling Stockholders" included in this prospectus for additional information.

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          We and certain of our stockholders are party to a stockholders agreement which was restated and amended on February 12, 2008 (the "Amended and Restated Stockholders Agreement"). Among other things, the Amended and Restated Stockholders Agreement contains certain restrictions on transfer of our capital stock, and provides that each of Ares and OTPP has the right to designate four members of our 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 a certain percentage of our outstanding common stock. Under the New Stockholders Agreement to be entered into among the Sponsors and us, effective upon completion of the offering, the Sponsors will have the right to nominate to our board of directors, subject to their election by our stockholders, so long as the Sponsors collectively own more than 50% of the then outstanding shares of our common stock, the greater of up to nine directors and the number of directors comprising a majority of our board and, subject to certain exceptions, so long as the Sponsors collectively own 50% or less of the then outstanding shares of our common stock, that number of directors (rounded up to the nearest whole number or, if such rounding would cause the Sponsors to have the right to elect a majority of our board of directors, rounded to the nearest whole number) that is the same percentage of the total number of directors comprising our board as the collective percentage of common stock owned by the Sponsors. Under the New Stockholders Agreement, each Sponsor will also agree to vote all of the shares of Class A common stock held by it in favor of the other Sponsor's nominees. The New Stockholders Agreement will also provide that, so long as the Sponsors collectively own more than one-third of our outstanding common stock, certain significant corporate actions will require the approval of at least one of the Sponsors. For additional information, see "Certain Relationships and Related Transactions — Director Independence" and "— Stockholders Agreements".

          GNC Parent Corporation was formed as a Delaware corporation in November 2006 to acquire all the outstanding common stock of GNC Corporation.

          Centers was formed in October 2003 and GNC Corporation was formed as a Delaware corporation in November 2003 by Apollo 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, Centers purchased all of the outstanding equity interests of General Nutrition Companies, Inc. In connection with a corporate reorganization, General Nutrition Companies, Inc. was merged with and into Centers in December 2008, with Centers surviving the merger.

          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.

          As of                          , Ares and OTPP, each of which is a selling stockholder in this offering, held             shares and             shares, respectively, of our Class A common stock, representing approximately         % and         %, respectively, of our outstanding Class A common stock, and OTPP held 28,168,561 shares of our Class B common stock, representing 100% of our outstanding Class B common stock. After giving effect to this offering, Ares and OTPP will hold             shares and              shares, respectively, of our Class A common stock, representing approximately         % and         %, respectively, of our outstanding Class A common stock, and OTPP will hold             shares of our Class B common stock, representing 100% of our outstanding Class B common stock. If the underwriters fully exercise their option to purchase additional shares, Ares and OTPP will hold             shares and             shares, respectively, of our Class A common stock, representing approximately         % and         %, respectively, of our outstanding Class A common

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stock, and OTPP will hold             shares of our Class B common stock, representing 100% of our outstanding Class B common stock. See "Principal and Selling Stockholders."

Corporate Structure

          The following diagram depicts our corporate structure.

GRAPHIC

Recent Transformation of GNC

          Beginning in 2006, we executed a series of strategic initiatives to enhance our existing business and growth profile. Specifically, we:

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Industry Overview

          We operate within the large and growing U.S. nutritional supplements industry. According to Nutrition Business Journal's Supplement Business Report 2010, our industry generated $26.9 billion in sales in 2009 and an estimated $28.7 billion in 2010, and is projected to grow at an average annual rate of approximately 5.3% through 2015. Our industry is highly fragmented, and we believe this fragmentation provides large operators, like us, the ability to compete more effectively due to scale advantages. We generate a significant portion of our sales revenue from strong performing sports nutrition and VMHS products.

          According to Nutrition Business Journal, sports nutrition products represented approximately 10.9% of the total U.S. nutritional supplements industry in 2009, and the category is expected to grow at a 7.2% CAGR from 2010 to 2015, representing the second-fastest growing product category in the nutritional supplements industry. By way of comparison, sports nutrition products, grouped in a manner consistent with Nutrition Business Journal's data, generated approximately 38% of our company-owned retail sales for 2009.

          According to Nutrition Business Journal, VMHS products represented approximately 60.8% of the total U.S. nutritional supplement industry in 2009, and the category is expected to grow at a 5.3% CAGR from 2010 to 2015. By way of comparison, VMHS products, grouped in a manner consistent with Nutrition Business Journal's data, generated approximately 43% of our company-owned retail sales for 2009.

          We expect several key demographic, healthcare, and lifestyle trends to drive the continued growth of our industry. These trends include:

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          Participants in our industry include specialty retailers, supermarkets, drugstores, mass merchants, multi-level marketing organizations, online retailers, mail-order companies and a variety of other smaller participants. The nutritional supplements sold through these channels are divided into four major product categories: VMHS; sports nutrition products; diet products; and other wellness products. Most supermarkets, drugstores, and mass merchants have narrow nutritional supplement product offerings limited primarily to simple vitamins and herbs, with less knowledgeable sales associates than specialty retailers. We believe that the market share of supermarkets, drugstores, and mass merchants over the last five years has remained relatively constant.

Competitive Strengths

          We believe we are well-positioned to capitalize on favorable industry trends as a result of the following competitive strengths:

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          As a result of our competitive strengths, we have maintained consistent revenue growth through the recent economic cycle. The third quarter of 2010 marked the 21st consecutive quarter of positive domestic company-owned same store sales growth. The strength and stability of our core business has resulted in part from industry growth in our key product categories, VMHS and sports nutrition, and from our efforts to increase market share across multiple distribution channels and geographies.

          Our consistent growth in company-owned retail sales, the positive operating leverage present in our retail operations, and cost containment initiatives, together with growth in our other channels of distribution, have enabled us to expand our EBITDA margin. EBITDA as a percentage of revenue has increased 470 basis points from 8.6% in 2005 to 13.3% in 2009. For a reconciliation of EBITDA to net income see "Selected Consolidated Financial Data".

          We expect that our existing store base and established distribution network can continue to be effectively leveraged to support higher sales volumes. We also believe the strength of our brand and our vertical integration will allow us to continue earning attractive product margins, particularly on proprietary products. GNC's franchise model enables us to maintain a global retail footprint, while minimizing the amount of required capital investment. Furthermore, our revenue mix from franchisee operations includes wholesale product sales, royalties, and fees, which we believe represent recurring, high-margin streams of income.

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Our Growth Strategy

          We plan to execute several strategies in the future to promote growth in revenue and operating income, and capture market share, including:

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