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Employment Agreement

 

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Title:

Employment Agreement

Entities:

Nutra Manufacturing, Inc; Skadden, Arps, Slate, Meagher & Flom LLP

Date:

2004

Size:

Preview shows 13KB of 57KB total

Price:

$47

ID:

#1629495

 

 

► Employment ► Employment Agreements
► Services ► Legal

 

 

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                              EMPLOYMENT AGREEMENT


THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into as
of the 5th day of December, 2003 (the "Effective Date"), by and between General
Nutrition Centers, Inc., a Delaware corporation (the "Company"), and REGINALD
STEELE (the "Executive").

WHEREAS, the Company desires to employ Executive on the terms
and subject to the conditions set forth herein and the Executive has agreed to
be so employed.

NOW, THEREFORE, in consideration of the mutual
representations, warranties, covenants and agreements set forth herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound, agree as
follows:

1. EMPLOYMENT OF EXECUTIVE; DUTIES.

1.1 TITLE. During the "Employment Period" (as
defined in SECTION 2 hereof), the Executive shall serve as SENIOR VICE PRESIDENT
OF INTERNATIONAL FRANCHISING of the Company. The Executive shall have the normal
duties, responsibilities and authority commensurate with such positions.

1.2 DUTIES. During the Employment Period, the
Executive shall do and perform all services and acts necessary or advisable to
fulfill the duties and responsibilities of his positions and shall render such
services on the terms set forth herein. In addition, the Executive shall have
such other executive and managerial powers and duties as may reasonably be
assigned to him, commensurate with his serving as SENIOR VICE PRESIDENT OF
INTERNATIONAL FRANCHISING. Except for sick leave, reasonable vacations, and
excused leaves of absence, the Executive shall, throughout the Employment
Period, devote substantially all his working time, attention, knowledge and
skills faithfully and to the best of his ability, to the duties and
responsibilities of his positions in furtherance of the business affairs and
activities of the Company, and its subsidiaries and affiliates. The Executive
shall at all times be subject to, observe and carry out such rules, regulations,
policies, directions, and restrictions as the Board may from time to time
reasonably establish for senior executive officers of the Company.

2. TERM OF EMPLOYMENT.

2.1 EMPLOYMENT PERIOD. The employment of the
Executive hereunder shall continue until the later to occur of (i) December 31,
2005, or (ii) the applicable expiration date of any extension of this Agreement
as provided in SECTION 2.2 hereof, unless terminated earlier in accordance with
the provisions of this Agreement (the "Employment Period").

2.2 EXTENSION. On October 31, 2004, and on each
October 31st thereafter, the Employment Period shall be extended for an
additional one-year period unless the Company or the Executive notifies the
other in writing at least 30 days prior to such date of its or his election, in
its or his sole discretion, not to extend the Employment Period.

<PAGE>

3. COMPENSATION AND GENERAL BENEFITS.

3.1 BASE SALARY.

(a) During the Employment Period, the
Company agrees to pay to the Executive an annual base salary in an amount equal
to $201,536.40 (such base salary, as adjusted from time to time pursuant to
SECTION 3.1(B), is referred to herein as the "Base Salary"). The Executive's
Base Salary, less amounts required to be withheld under applicable law, shall be
payable in equal installments in accordance with the practice of the Company in
effect from time to time for the payment of salaries to officers of the Company,
but in no event less frequently than monthly.

(b) The Board of Directors of the
Company (the "Board") or the Compensation Committee established by the Board
(the "Compensation Committee") shall review the Executive's performance on an
annual basis and, based on such review, may increase Executive's Base Salary, as
it, acting in its sole discretion, shall determine to be reasonable and
appropriate.

3.2 BONUS. With respect to the 2004 calendar
year and with respect to each calendar year that commences during the Employment
Period, the Executive shall be eligible to receive from the Company an annual
performance bonus (the "Annual Bonus") in an amount to be determined by the
Compensation Committee in the exercise of its discretion for the applicable
year. Any Annual Bonus earned shall be payable in full within forty-five (45)
days following the determination of the amount thereof and in accordance with
the Company's normal payroll practices and procedures. Any Annual Bonus payable
under this Section 3.2 shall not be payable unless the Executive is employed by
the Company on the last day of the period to which such Annual Bonus relates.

3.3 EXPENSES. During the Employment Period, in
addition to any amounts to which the Executive may be entitled pursuant to the
other provisions of this SECTION 3.3 or elsewhere herein, the Executive shall be
entitled to receive prompt reimbursement from the Company for all reasonable and
necessary expenses incurred by him in performing his duties hereunder on behalf
of the Company, subject to, and consistent with, the Company's policies for
expense payment and reimbursement, in effect from time to time.

3.4 FRINGE BENEFITS. During the Employment
Period, in addition to any amounts to which the Executive may be entitled
pursuant to the other provisions of this SECTION 3 or elsewhere herein, the
Executive shall be entitled to participate in, and to receive benefits under,
any benefit plans, arrangements or policies made available by the Company to its
executives and key management employees generally, subject to and on a basis
consistent with the terms, conditions and overall administration of each such
plan, arrangement or policy. The award of any additional fringe benefits under
this SECTION 3.4 shall be separate and distinct from the right of the Executive
to receive the Annual Bonus payment from the Company described in SECTION 3.2.

2

<PAGE>

3.5 STOCK OPTIONS. Subject to SECTION 4 below
and the approval of the Compensation Committee, Executive shall be eligible to
participate in and be granted awards under the General Nutrition Centers, Inc.
2003 Omnibus Stock Incentive Plan (the "Plan").

4. TERMINATION.

4.1 GENERAL. The employment of the Executive
hereunder (and the Employment Period) shall terminate as provided in SECTION 2,
unless earlier terminated in accordance with the provisions of this SECTION 4.

4.2 DEATH OR DISABILITY OF THE EXECUTIVE.

(a) The employment of the Executive
hereunder (and the Employment Period) shall terminate upon (i) the death of the
Executive, and (ii) at the option of the Company, upon not less than fifteen
(15) days' prior written notice to the Executive or his personal representative
or guardian, if the Executive suffers a "Total Disability" (as defined in
SECTION 4.2(B) below). Upon termination for death or Total Disability, the
Company shall pay to the Executive, guardian or personal representative, as the
case may be (reduced by any benefits paid or payable to the Executive, his
beneficiaries or estate under any Company-sponsored disability benefit plan
program or policy for the period following such date of termination), (i) the
Executive's current Base Salary for the remainder of the Employment Period
(without giving effect to any further extensions pursuant to SECTION 2.2 hereof)
and (ii) subject to the discretion of the Compensation Committee, a prorated
share of the Annual Bonus pursuant to SECTION 3.2 hereof (based on the period of
actual employment) that the Executive would have been entitled to had he worked
the full year during which the termination occurred, provided that bonus targets
are met for the year of such termination. The bonus shall be payable in full
within forty-five (45) days following the determination of the amount thereof
and in accordance with the Company's normal payroll practices and procedures.

(b) For purposes of this Agreement,
"Total Disability" shall mean (i) if the Executive is subject to a legal decree
of incompetency (the date of such decree being deemed the date on which such
disability occurred), (ii) the written determination by a physician selected by
the Company that, because of a medically determinable disease, injury or other
physical or mental disability, the Executive is unable substantially to perform,
with or without reasonable accommodation, the material duties of the Executive
required hereby, and that such disability has lasted for one hundred twenty days
(120) days during the immediately preceding twelve (12) month period or is, as
of the date of determination, reasonably expected to last six (6) months or
longer after the date of determination, in each case based upon medically
available reliable information, or (iii) Executive's qualifying for benefits
under the Company's long-term disability coverage, if any.

(c) In conjunction with determining
mental and/or physical disability for purposes of this Agreement, the Executive
hereby consents to (i) any examinations that the Compensation Committee
determines are relevant to a determination of whether he is mentally and/or
physically disabled, or required by the Company physician, (ii) furnish such
medical information as may be reasonably requested, and (iii) waive any
applicable physician patient privilege that may arise because of such
examination.

3

<PAGE>

(d) With respect to outstanding stock
options and other equity based awards held by the Executive as of the date of
termination, (i) any such options that are not vested or exercisable as of such
date of termination shall immediately expire and any such equity based awards
that are not vested as of such date of termination shall immediately be
forfeited, and (ii) any such options that are vested and exercisable as of such
date of termination shall expire immediately following the expiration of the one
hundred eighty (180) day period following such date of termination.

(e) With respect to any shares of
Common Stock held by the Executive that are vested as of the date of termination
(or issued pursuant to the exercise of options following such date of
termination pursuant to SECTION 4.2(D) hereof), for the two hundred seventy
(270) day period following such date of termination, the Company (or its
designee) shall have the right to purchase from the Executive or his
beneficiary, as applicable, and the Executive or his beneficiary hereby agrees
to sell any or all such shares to the Company (or the Company's designee) for an
amount equal to the product of (x) the per share current fair market value of a
share of Common Stock (as determined by the Board in good faith) and (y) the
number of shares so purchased.

4.3 TERMINATION BY THE COMPANY WITHOUT CAUSE OR
RESIGNATION BY THE EXECUTIVE FOR GOOD REASON.

(a) The Company may terminate
Executive's employment without "Cause" (as defined below), and thereby terminate
Executive's employment (and the Employment Period) under this Agreement at any

 

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