* The calculation assumes that there are a total of 84,607,231 shares of Common Stock outstanding as of May 6, 2020, as reported in the Issuer’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, filed with the Securities and
Exchange Commission on May 11, 2020, and that a total of an additional 60,738,317 shares of Common Stock would be issuable as of the date hereof upon conversion of the Convertible Preferred Stock, representing $25,000,000 of accumulated dividend
thereon (at a per share conversion price of $5.35).
This Amendment No. 2 to Schedule 13D (this “Amendment No. 2”) relates to shares of Class A common stock, par value $0.001 per share (the “Common Stock”), of GNC Holdings, Inc., a Delaware corporation (the “Issuer”).
This Amendment No. 2 amends the Schedule 13D, as previously filed on November 19, 2018 with the Securities and Exchange Commission by Harbin Pharmaceutical Group Co., Ltd, a corporation incorporated in the
People’s Republic of China (“Harbin”), as amended by Amendment No. 1 thereto filed on November 4, 2019, by furnishing the information set forth below. Except as otherwise specified in this Amendment No. 2, all previous Items are unchanged.
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Item 4.
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Purpose of Transaction
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The information previously provided in response to Item 4 is hereby amended and supplemented by adding the following at the end thereof:
Restructuring
On June 23, 2020, the Issuer announced that it, certain of its North American entities, certain of its secured lenders, and key stakeholders reached an agreement to pursue a dual path process to allow the Issuer to
restructure its balance sheet and accelerate its business strategy through Chapter 11 (“Chapter 11”) of the U.S. Bankruptcy Code (the “Restructuring Transaction”). The Issuer reached an agreement on a pre-arranged standalone plan of reorganization
(the “Standalone Plan”) and an agreement in principle (the “Term Sheet”) for a sale (the “Sale”) of the Issuer’s business to Harbin Pharmaceutical Group Holding Co., Ltd., an affiliate of Harbin, or its designee (the “Purchaser”) for $760 million,
subject to adjustments. If the Sale is timely consummated, it would be implemented instead of the Standalone Plan. The Issuer expects to confirm the Standalone Plan or consummate the Sale in the fall of 2020.
The Purchaser is currently engaged in discussions with the Issuer’s management, Board of Directors and other stakeholders with respect to the Sale, definitive documents therefor and other strategic transactions that,
if consummated, could result in one or more of the transactions, events or actions specified in clauses (a) through (j) of Item 4 of Schedule 13D.
The Term Sheet does not include a description of all of the terms, conditions, and other provisions that will be contained in the definitive documentation governing the Sale and the final terms and the occurrence of
the Sale are subject to terms and conditions to be set forth therein. There can be no assurance that the Sale will occur, or that the structure or terms of any such Sale, if it occurs, will not change materially from the structure and terms
contemplated in the Term Sheet and summarized herein. The transactions contemplated by the Term Sheet are subject to definitive documentation on terms and conditions mutually acceptable to the parties and on a number of other usual and customary
conditions precedent including, without limitation, that the Bankruptcy Court will have entered an order approving the Sale as implemented pursuant to a bid and auction process under Section 363 of the Bankruptcy Code or in connection with
confirmation of a Chapter 11 plan, whichever is more efficient and expeditious, and such order will not have been stayed or modified or subject to appeal. Further, certain of the transactions contemplated by the Term Sheet, including entering into
new financing facilities and instruments would involve transactions with third-parties or be subject to the receipt of approvals (which approvals may or may not be obtained), and could be further contingent on the satisfaction of certain conditions
(including various third-party consents) and various other matters outside of the control of the Issuer or the Purchaser. Harbin reserves the right to change their intention with respect to any and all matters referred to in this Item 4 at any
time.
Harbin further intends to continuously evaluate the Issuer’s businesses and prospects, refinancing options, alternative investment opportunities and all other factors deemed relevant with respect thereto. The
foregoing description of such possible transactions does not purport to be complete.
Except as set forth herein, Harbin has no current intention, plan or proposal with respect to items (a) through (j) of Item 4 of Schedule 13D.
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Item 5.
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Interest in Securities of the Issuer
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The information previously provided in the first paragraph of the response to Item 5(a) – (c) is hereby amended and restated to read as follows:
(a) – (c) The percentage of the Issuer’s outstanding shares of Common Stock beneficially owned by Harbin is based on 84,607,231 shares of Common Stock outstanding as
of May 6, 2020, as reported in the Issuer’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, filed with the Securities and Exchange Commission on May 11, 2020.