Nutrisystem, Inc.

November 1, 2012

Ms. Dawn Zier

[Address redacted]

Dear Dawn:

We are pleased to extend to you an offer to join NutriSystem, Inc. (the "Company") on the terms set forth in this letter agreement (this "Agreement").

Your signature below confirms that all information provided to us during the interview and hiring process is true and accurate in all material respects. To indicate your acceptance of our offer and its terms, please sign and date the Agreement in the space provided below and return it to me. Please retain a copy for your records.

Agreed and accepted on November 1, 2012:

By: /s/ Dawn M. Zier __

Dawn Zier

2008 LONG-TERM INCENTIVE PLAN

This STOCK AWARD AGREEMENT, dated as of November __, 2012 (the " Date of Grant "), is delivered by NutriSystem, Inc. (the " Company ") to Dawn Zier (the " Grantee ").

A. The Amended and Restated NutriSystem, Inc. 2008 Long-Term Incentive Plan (the " Plan ") permits the grant of stock awards in accordance with the terms and conditions of the Plan.

B. In satisfaction of the Company's commitment to issue restricted shares to the Grantee upon commencement of her employment, as contained in the letter agreement between the Employer and the Grantee dated November 1, 2012 (the " Employment Agreement "), the Compensation Committee of the Board of Directors of the Company (the " Committee ") has approved this stock award.

NOW, THEREFORE, the parties to this Agreement, intending to be legally bound hereby, agree as follows:

1. Stock Award .
1. Subject to the terms and conditions set forth in this Agreement and the Plan, the Committee hereby grants to the Grantee [$800,000 divided by grant date FMV] shares of common stock of the Company, subject to the restrictions set forth below and in the Plan (the " Restricted Stock ") and acknowledges payment by the Grantee of $<<M Share>> 0.001 per share) for the Restricted Stock. Shares of Restricted Stock may not be transferred by the Grantee or subjected to any security interest until the shares have become vested pursuant to this Agreement and the Plan.
2. The Grantee hereby accepts this stock award and acknowledges that it satisfies the Company's commitment to issue restricted shares to her upon commencement of her employment, as described in the Employment Agreement.
2. Vesting and Nonassignability of Restricted Stock .
1. Except as provided in Paragraphs 2(b), 2(c) and 2(d), the shares of Restricted Stock shall become vested, and the restrictions described in Paragraphs 2(e) and 2(f) shall lapse, according to the following vesting schedule, if the Grantee continues to be employed by, or provide services to, the Company or any subsidiary of the Company (the " Employer ") from the Date of Grant until the applicable vesting date:

(i) 25% of the shares subject to the Restricted Stock shall become vested six months following the Date of Grant;

(ii) 25% of the shares subject to the Restricted Stock shall become vested on the first anniversary of the Date of Grant;

(iii) 25% of the shares subject to the Restricted Stock shall become vested eighteenth months following the Date of Grant; and

(iv) the remaining 25% of the shares subject to the Restricted Stock shall become vested on the second anniversary of the Date of Grant.

The vesting of the shares subject to the Restricted Stock shall be cumulative, but shall not exceed 100% of the shares subject to the Restricted Stock. If the foregoing schedule would produce fractional shares, the number of shares that vest shall be rounded down to the nearest whole share.

2. If a Change of Control occurs while the Grantee is employed by, or providing service to, the Employer, the shares of Restricted Stock shall become fully vested on the date of the Change of Control.
3. If the Grantee ceases to be employed by, or provide services to, the Employer on account of (i) the death of the Grantee, or (ii) termination by the Employer because the Grantee becomes "totally disabled" (defined as a condition entitling Grantee to benefits under any long-term disability plan or policy maintained or funded by the Employer), then, subject to satisfaction of the requirements contained in the death and Disability provisions of the Employment Agreement regarding execution of a release and compliance with restrictive covenants, the next tranche of shares that would have vested under Paragraph 2(a) following such termination of employment or service if the Grantee had continued to be employed or provide services, shall become vested on the date of such termination.
4. If the Grantee ceases to be employed by, or provide services to, the Employer on account of (i) a termination by the Employer without "cause" (as defined in the Employment Agreement), or (ii) the resignation by the Grantee with "good reason" (as defined in the Employment Agreement), the vesting of the Restricted Stock shall accelerate to the extent, and subject to the conditions, described in the severance provisions of the Employment Agreement.
5. Except as otherwise provided in this Paragraph 2, if the Grantee's employment or service with the Employer terminates for any reason before the Restricted Stock is fully vested, the shares of Restricted Stock that are not then vested (or do not then become vested) shall be forfeited and must be immediately returned to the Company, and the Company shall pay to the Grantee, as consideration for the return of the non-vested shares, the lesser of $0.001 per share or the fair market value (as defined in the Plan) of a share of common stock of the Company on the date of the forfeiture, for each returned share.
6. During the period before the shares of Restricted Stock vest (the " Restriction Period "), the non-vested shares of Restricted Stock may not be assigned, transferred, pledged or otherwise disposed of by the Grantee. Any attempt to assign, transfer, pledge or otherwise dispose of the shares contrary to the provisions hereof, and the levy of any execution, attachment or similar process upon the shares, shall be null, void and without effect.
3. Issuance of Shares .
1. The Company will cause the Restricted Stock to be issued in the Grantee's name either by book-entry registration or issuance of a stock certificate or certificates. While the Restricted Stock remains unvested, the Company will cause an appropriate stop-transfer order to be issued and to remain in effect with respect to the Restricted Stock. As soon as practicable following the vesting of any of the Restricted Stock (and provided that appropriate arrangements have been made with the Company for the satisfaction of any required tax withholding), the Company will cause the stop-transfer order to be removed from an appropriate number of shares.
2. If any certificate is issued in respect of Restricted Stock, that certificate will include such legends as the Company determines are appropriate and will be held in escrow by the Company or its designee. In addition, the Grantee may be required to execute and deliver to the Company or its designee a stock power with respect to the Restricted Stock. When any certificated Restricted Stock becomes vested, the Company will cause a new certificate to be issued without that portion of the legend referencing the forfeiture conditions described in Paragraph 2 and will cause that new certificate to be delivered to the Grantee (provided that appropriate arrangements have been made with the Company for the satisfaction of any required tax withholding).
3. During the Restriction Period, the Grantee shall receive any cash dividends or other distributions paid with respect to the shares of Restricted Stock and may vote the shares of Restricted Stock. In the event of a dividend or distribution payable in stock or other property or a reclassification, split up or similar event during the Restriction Period, the shares or other property issued or declared with respect to the non-vested shares of Restricted Stock shall be subject to the same forfeiture conditions and transfer restrictions as those non-vested shares.
4. The obligation of the Company to deliver shares upon the vesting of the Restricted Stock shall be subject to all applicable laws, rules, and regulations and such approvals by governmental agencies as may be deemed appropriate to comply with relevant securities laws and regulations.
4. Dissolution or Liquidation; Sale or Merger . The provisions of the Plan applicable to a dissolution, liquidation, sale or merger of the Company shall apply to the Restricted Stock, and, in the event of a dissolution, liquidation, sale or merger of the Company, the Committee may take such actions as it deems appropriate pursuant to the Plan.
5. Grant Subject to Plan Provisions . This grant is made pursuant to the Plan, the terms of which are incorporated herein by reference, and in all respects shall be interpreted in accordance with the Plan. The grant is subject to interpretations, regulations and determinations concerning the Plan established from time to time by the Committee in accordance with the provisions of the Plan, including, but not limited to, provisions pertaining to (i) rights and obligations with respect to withholding taxes, (ii) the registration, qualification or listing of the shares, (iii) changes in capitalization of the Company, and (iv) other requirements of applicable law. The Committee shall have the authority to interpret and construe the grant pursuant to the terms of the Plan, and its decisions shall be conclusive as to any questions arising hereunder.
6. Withholding . The Grantee shall be required to pay to the Employer, or make other arrangements satisfactory to the Employer to provide for the payment of, any federal, state, local or other taxes that the Employer is required to withhold with respect to the grant or vesting of the Restricted Stock. Subject to Committee approval, the Grantee may elect to satisfy any tax withholding obligation of the Employer with respect to the Restricted Stock by having vested shares withheld up to an amount that does not exceed the minimum applicable withholding tax rate for federal (including FICA), state, local and other tax liabilities. Notwithstanding anything to the contrary in the Plan or this Agreement, until the Grantee has satisfied the Employer's withholding obligation with respect to the shares of Restricted Stock, the Grantee shall not have any rights to sell or transfer any shares that have become vested pursuant to Paragraph 2.
7. Restrictions on Sale or Transfer of Shares .
1. The Grantee will not sell, transfer, pledge, donate, assign, mortgage, hypothecate or otherwise encumber the shares underlying this grant unless the shares are registered under the Securities Act of 1933, as amended (the " Securities Act "), or the Company is given an opinion of counsel reasonably acceptable to the Company that such registration is not required under the Securities Act.
2. In consideration for this grant of Restricted Stock, the Grantee agrees to be bound by the Company's policies, including, but not limited to the Insider Trading Policy, Anti-Hedging and Clawback Policies, and understands that there may be certain times during the year that the Grantee will be prohibited from selling, transferring, donating, assigning, mortgaging, hypothecating or otherwise encumbering the Company securities.
8. No Employment or Other Rights . This grant shall not confer upon the Grantee any right to be retained by or in the employ or service of the Employer and shall not interfere in any way with the right of the Employer to terminate the Grantee's employment or service at any time. The right of the Employer to terminate at will the Grantee's employment or service at any time for any reason is specifically reserved.
9. Confidential Information, Non-Competition and Non-Solicitation .  The Grantee affirms her obligations under the Nondisclosure and Noncompete Agreement for Management Employees.
10. Assignment by Company . The rights and protections of the Company hereunder shall extend to any successors or assigns of the Company and to the Company's parents, subsidiaries, and affiliates. This Agreement may be assigned by the Company without the Grantee's consent.
11. Effect on Other Benefits . The value of this award or the shares subject hereto shall not be considered eligible earnings for purposes of any other plan maintained by the Company or the Employer. Neither shall such value be considered part of the Grantee's compensation for purposes of determining or calculating other benefits that are based on compensation, such as life insurance.
12. Applicable Law . The validity, construction, interpretation and effect of this instrument shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to the conflicts of laws provisions thereof.
13. Entire Agreement . This Agreement, including the terms of the Employment Agreement specifically incorporated by reference in Sections 2(c) and 2(d), represents the entire agreement between the parties hereto relating to the subject matter hereof, and merges and supersedes all prior and contemporaneous discussions, agreements and understandings of every nature relating to the subject matter hereof.
14. Consent to Electronic Delivery . The Grantee hereby authorizes the Company to deliver electronically any prospectuses or other documentation related to this Agreement, the Plan and any other compensation or benefit plan or arrangement in effect from time to time (including, without limitation, reports, proxy statements or other documents that are required to be delivered to participants in such plans or arrangements pursuant to federal or state laws, rules or regulations). For this purpose, electronic delivery will include, without limitation, delivery by means of e-mail or e-mail notification that such documentation is available on the Company's intranet site. Upon written request, the Company will provide to the Grantee a paper copy of any document also delivered to the Grantee electronically. The authorization described in this paragraph may be revoked by the Grantee at any time by written notice to the Company.

IN WITNESS WHEREOF, the Company has caused its duly authorized officer to execute this Agreement, and the Grantee has placed his or her signature hereon, on this __ day of November, 2012.

NUTRISYSTEM, INC.

Attest:

By:

Name: Kathleen Simone Name: David Clark

Title: SVP, Finance & Controller Title: Chief Financial Officer

I hereby accept the grant of Restricted Stock described in this Agreement, and I agree to be bound by the terms of the Plan and this Agreement. I hereby further agree that all of the decisions and determinations of the Committee shall be final and binding.

This NONQUALIFIED STOCK OPTION GRANT AGREEMENT (the " Agreement "), dated as of November __, 2012 (the " Date of Grant "), is delivered by NutriSystem, Inc. (the " Company ") to Dawn Zier (the " Grantee ").

A. The Amended and Restated NutriSystem, Inc. 2008 Long-Term Incentive Plan (the " Plan ") permits the grant of stock options to purchase shares of common stock of the Company, par value $0.001 per share (" Company Stock ").

B. In satisfaction of the Company's commitment to issue stock options to the Grantee upon commencement of her employment, as contained in the letter agreement between the Employer and the Grantee dated November 1, 2012 (the " Employment Agreement "), the Compensation Committee of the Board of Directors of the Company (the " Committee ") has approved this grant.

NOW, THEREFORE, the parties to this Agreement, intending to be legally bound hereby, agree as follows:

1. Grant of Option .
1. Subject to the terms and conditions set forth in this Agreement and in the Plan, the Company hereby grants to the Grantee a nonqualified stock option (the " Option ") to purchase [$300,000 divided by grant date fair value] shares of Company Stock at an exercise price of $[grant date FMV] per share of Company Stock. The Option shall become vested and exercisable according to Paragraph 2 below.
2. The Grantee hereby accepts this stock award and acknowledges that it satisfies the Company's commitment to issue stock options to her upon commencement of her employment, as described in the Employment Agreement.
2. Exercisability of Option .
1. Except as provided below in Sections 2(b) and 2(c), the Option shall become vested and exercisable on the following dates, if the Grantee continues to be employed by, or provide services to, the Employer (as defined in the Plan) from the Date of Grant through the applicable vesting date (each, a " Vesting Date "):

 

Vesting Date	Portion of Option Becoming Exercisable on the Vesting Date
First Anniversary of Date of Grant	25%
Second Anniversary of Date of Grant	25%
Third Anniversary of Date of Grant	25%
Fourth Anniversary of Date of Grant	25%

The vesting and exercisability of the Option is cumulative, but shall not exceed 100% of the shares of Company Stock subject to the Option. If the foregoing schedule would produce fractional shares of Company Stock, the number of shares of Company Stock for which the Option becomes vested and exercisable shall be rounded down to the nearest whole share.

2. If at any time prior to the date the Option becomes vested and exercisable as described in subparagraph 2(a) above, the Grantee ceases to be employed by, or provide services to, the Employer on account of (i) the death of the Grantee, or (ii) termination by the Employer because the Grantee becomes "totally disabled" (defined as a condition entitling Grantee to benefits under any long-term disability plan or policy maintained or funded by the Employer), then the Option, subject to satisfaction of the requirements contained in the death and Disability provisions of the Employment Agreement regarding execution of a release and compliance with restrictive covenants, shall become fully vested and exercisable on the date of such cessation of employment or service.
3. If at any time prior to the date the Option becomes vested and exercisable as described in subparagraph 2(a) above, the Grantee ceases to be employed by, or provide services to, the Employer on account of (i) a termination by the Employer without "cause" (as defined in the Employment Agreement), or (ii) the resignation by the Grantee with "good reason" (as defined in the Employment Agreement), the vesting of the Option shall accelerate to the extent, and subject to the conditions, described in the severance provisions of the Employment Agreement.
3. Term of Option .
1. The Option shall have a term of seven years from the Date of Grant and shall terminate at the expiration of that period, unless it is terminated at an earlier date pursuant to the provisions of this Agreement or the Plan.
2. The Option shall also automatically terminate upon the happening of the first of the following events:
1. The expiration of the 90-day period after the Grantee ceases to be employed by, or provide service to, the Employer, if the termination is for any reason other than "total disability," death or "cause."
2. The expiration of the one-year period after the Grantee ceases to be employed by, or provide service to, the Employer on account of the Grantee's "total disability."
3. The expiration of the one-year period after the Grantee ceases to be employed by, or provide service to, the Employer, if the Grantee dies while employed by, or providing service to, the Employer or within 90 days after the Grantee ceases to be so employed or provide such services on account of a termination described in clause (i) above.
4. The date on which the Grantee ceases to be employed by, or provide service to, the Employer for "cause." In addition, notwithstanding the prior provisions of this Paragraph 3, if the Grantee engages in conduct that constitutes "cause" after the Grantee's employment or service terminates, the Option shall immediately terminate and the Grantee shall automatically forfeit all shares of Company Stock underlying any exercised portion of the Option for which the Company has not yet delivered the share certificates, upon refund by the Company of the exercise price paid by the Grantee for such shares.

Notwithstanding the foregoing, in no event may the Option be exercised after the date that is immediately before the seventh anniversary of the Date of Grant. Any portion of the Option that is not exercisable at the time the Grantee ceases to be employed by, or provide service to, the Employer (determined after giving effect to Paragraph 2(b) or 2(c), if applicable) shall immediately terminate.

4. Exercise Procedures .
1. Subject to the provisions of Paragraphs 2 and 3 above, the Grantee may exercise part or all of the exercisable portion of the Option by giving the Company written notice of intent to exercise in the manner provided in this Agreement, specifying the number of shares of Company Stock as to which the Option is to be exercised and the method of payment. Payment of the exercise price and applicable withholding taxes shall be made in accordance with procedures established by the Committee from time to time based on the type of payment being made but, in any event, prior to issuance of the shares of Company Stock. The Grantee shall pay the exercise price and applicable withholding taxes (i) in cash or certified check, (ii) if permitted by the Committee, by delivering shares of Company Stock owned by the Grantee and having a Fair Market Value (as defined in the Plan) on the date of exercise equal to the exercise price or by attestation (on a form prescribed by the Committee) to ownership of shares of Company Stock having an aggregate Fair Market Value on the date of exercise equal to the exercise price, (iii) by payment through a broker in accordance with procedures permitted by Regulation T of the Federal Reserve Board, or (iv) by such other method as the Committee may approve to the extent permitted by applicable law. The Committee may impose from time to time such limitations as it deems appropriate on the use of shares of Company Stock to exercise the Option.
2. The obligation of the Company to deliver shares of Company Stock upon exercise of the Option shall be subject to all applicable laws, rules, and regulations and such approvals by governmental agencies as may be deemed appropriate by the Committee, including such actions as Company counsel shall deem necessary or appropriate to comply with relevant securities laws and regulations. The Company may require that the Grantee (or other person exercising the Option after the Grantee's death) represent that the Grantee is purchasing the shares of Company Stock for the Grantee's own account and not with a view to, or for sale in connection with, any distribution of the shares of Company Stock, or such other representations as the Committee deems appropriate. All shares of Company Stock issued pursuant to this Option shall be subject to any applicable clawback and other policies implemented by the Board of Directors of the Company, as in effect from time to time.
3. All obligations of the Company under this Agreement shall be subject to the rights of the Company as set forth in the Plan to withhold amounts required to be withheld for all applicable taxes. Subject to Committee approval, the Grantee may elect to satisfy any tax withholding obligation of the Employer with respect to the Option by having shares of Company Stock withheld up to an amount that does not exceed the minimum applicable withholding tax rate for federal (including FICA), state and local tax liabilities.
5. Dissolution or Liquidation; Sale or Merger . The provisions of the Plan applicable to a dissolution, liquidation, sale or merger of the Company shall apply to the Option and, in the event of a dissolution, liquidation, sale or merger of the Company, the Committee may take such actions as it deems appropriate pursuant to the Plan.
6. Restrictions on Exercise . Except as the Committee may otherwise permit pursuant to the Plan, only the Grantee may exercise the Option during the Grantee's lifetime and, after the Grantee's death, the Option shall be exercisable (subject to the limitations specified in the Plan) solely by the person who acquires the right to exercise the Option by will or by the laws of descent and distribution, to the extent that the Option is exercisable pursuant to this Agreement.
7. Grant Subject to Plan Provisions . This grant is made pursuant to the Plan, the terms of which are incorporated herein by reference, and in all respects shall be interpreted in accordance with the Plan. The grant and exercise of the Option are subject to interpretations, regulations and determinations concerning the Plan established from time to time by the Committee in accordance with the provisions of the Plan, including, but not limited to, provisions pertaining to (a) rights and obligations with respect to withholding taxes, (b) the registration, qualification or listing of the shares of Company Stock, (c) changes in capitalization of the Company and (d) other requirements of applicable law. The Committee shall have the authority to interpret and construe the Option pursuant to the terms of the Plan, and its decisions shall be conclusive as to any questions arising hereunder.
8. Restrictions on Sale or Transfer of Shares.
1. The Grantee agrees that the Grantee will not sell, transfer, pledge, donate, assign, mortgage, hypothecate or otherwise encumber the shares of Company Stock underlying the Option unless the shares of Company Stock are registered under the Securities Act of 1933, as amended (the " Securities Act "), or the Company is given an opinion of counsel reasonably acceptable to the Company that such registration is not required under the Securities Act.
2. In consideration for this Option grant, the Grantee agrees to be bound by the Company's policies, including, but not limited to the Insider Trading Policy, Anti-Hedging and Clawback Policies, and understands that there may be certain times during the year that the Grantee will be prohibited from selling, transferring, donating, assigning, mortgaging, hypothecating or otherwise encumbering the Company securities.
9. No Employment or Other Rights . The grant of the Option shall not confer upon the Grantee any right to be retained by or in the employ or service of the Employer and shall not interfere in any way with the right of the Employer to terminate at will the Grantee's employment or service at any time. The right of the Employer to terminate at will the Grantee's employment or service at any time for any reason is specifically reserved.
10. No Stockholder Rights . Neither the Grantee, nor any person entitled to exercise the Grantee's rights in the event of the Grantee's death, shall have any of the rights and privileges of a stockholder with respect to the shares of Company Stock subject to the Option, until certificates for shares of Company Stock have been issued upon the exercise of the Option.
11. Confidential Information, Non-Competition and Non-Solicitation . The Grantee affirms her obligations under the Nondisclosure and Noncompete Agreement for Management Employees.
12. Assignment and Transfers . Except as the Committee may otherwise permit pursuant to the Plan, the rights and interests of the Grantee under this Agreement may not be sold, assigned, encumbered or otherwise transferred except, in the event of the death of the Grantee, by will or by the laws of descent and distribution. In the event of any attempt by the Grantee to alienate, assign, pledge, hypothecate, or otherwise dispose of the Option or any right hereunder, except as provided for in this Agreement, or in the event of the levy or any attachment, execution or similar process upon the rights or interests hereby conferred, the Company may terminate the Option by notice to the Grantee, and the Option and all rights hereunder shall thereupon become null and void. The rights and protections of the Company hereunder shall extend to any successors or assigns of the Company and to the Company's parents, subsidiaries, and affiliates. This Agreement may be assigned by the Company without the Grantee's consent.
13. Effect on Other Benefits . The value of this Option or the shares of Company Stock received upon exercise of the Option shall not be considered eligible earnings for purposes of any other plans maintained by the Company or the Employer. Neither shall such value be considered part of the Grantee's compensation for purposes of determining or calculating other benefits that are based on compensation, such as life insurance.
14. Applicable Law . The validity, construction, interpretation and effect of this instrument shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to the conflicts of laws provisions thereof.
15. Notice . Notices permitted or required under this Agreement shall be in writing and shall be deemed to have been duly given when delivered by hand or overnight courier addressed, in the case of the Company, c/o its General Counsel at its principal executive office and, in the case of the Grantee, to her most recent address set forth in the personnel records of the Company.
16. Entire Agreement . This Agreement, including the terms of the Employment Agreement specifically incorporated by reference in Sections 2(b) and 2(c), represents the entire agreement between the parties hereto relating to the subject matter hereof, and merges and supersedes all prior and contemporaneous discussions, agreements and understandings of every nature relating to the subject matter hereof.
17. Consent to Electronic Delivery . The Grantee hereby authorizes the Company to deliver electronically any prospectuses or other documentation related to this Agreement, the Plan and any other compensation or benefit plan or arrangement in effect from time to time (including, without limitation, reports, proxy statements or other documents that are required to be delivered to participants in such plans or arrangements pursuant to federal or state laws, rules or regulations). For this purpose, electronic delivery will include, without limitation, delivery by means of e-mail or e-mail notification that such documentation is available on the Company's intranet site. Upon written request, the Company will provide to the Grantee a paper copy of any document also delivered to the Grantee electronically. The authorization described in this paragraph may be revoked by the Grantee at any time by written notice to the Company.

IN WITNESS WHEREOF, the Company has caused its duly authorized officer to execute this Agreement, and the Grantee has placed his or her signature hereon, on this ___ day of November, 2012.

NUTRISYSTEM, INC.

Attest:

By:

Name: Kathleen Simone Name: David Clark

Title: SVP, Finance & Controller Title: Chief Financial Officer

I hereby accept the grant of the Option described in this Agreement, and I agree to be bound by the terms of the Plan and this Agreement. I hereby further agree that all of the decisions and determinations of the Committee shall be final and binding.

This PERFORMANCE-BASED RESTRICTED STOCK UNIT GRANT (this " Grant "), dated as of November __, 2012 (the " Date of Grant "), is delivered by NutriSystem, Inc. (the " Company ") to Dawn Zier (the " Grantee ").

A. The Amended and Restated NutriSystem, Inc. 2008 Long-Term Incentive Plan (the " Plan ") permits the grant of performance-based restricted stock units that are convertible into an equivalent number of shares of common stock of the Company, par value $0.001 per share (the " Company Stock "), with the total number of performance-based restricted stock units that may be earned and converted into shares of Company Stock conditioned on the achievement of specified performance goals and vesting conditions.

B. In satisfaction of the Company's commitment to issue performance-based restricted stock units to the Grantee upon commencement of her employment, as contained in the letter agreement between the Employer and the Grantee dated November 1, 2012 (the " Employment Agreement "), the Compensation Committee (the " Committee ") of the Board of Directors of the Company (the " Board ") has approved this Grant.

NOW, THEREFORE, the parties to this Grant, intending to be legally bound hereby, agree as follows:

1. Grant of Performance-Based Restricted Stock Units . Subject to the terms and conditions set forth in this Grant and the Plan, the Company hereby grants to the Grantee [PRSUs with a grant date fair value of $300,000] performance-based restricted stock units (the " Performance Units "). The Performance Units are contingently awarded and will become vested and distributable if and only to the extent that the performance goals and other conditions set forth in this Grant are met. Each Performance Unit shall be a phantom right and shall be equivalent to one share of Company Stock on the applicable distribution date, as described in Paragraph 4 below. The number of Performance Units set forth above is equal to the number of Performance Units that will vest upon achievement of the target level of performance (the " Target Award ").
2. Acceptance of Grant . The Grantee hereby accepts this Grant and acknowledges that it satisfies the Company's commitment to issue performance-based restricted stock units to her upon commencement of her employment, as described in the Employment Agreement.
3. Vesting .
1. The Performance Units shall vest on December 31, 2015 (the " Service Date ") to the extent determined based on the attached Exhibit A , if the Grantee remains in continuous service with the Employer through the Service Date. Any Performance Units that do not vest due to failure to fully satisfy the applicable performance goal shall be forfeited as of the Service Date and the Grantee shall not have any further rights with respect to those units.
2. If the Grantee ceases to perform services for the Employer prior to the Service Date on account of a termination of the Grantee's employment or service due to her death or "disability" (as defined in the Employment Agreement), then subject to satisfaction of the requirements contained in the death and Disability provisions of the Employment Agreement regarding execution of a release and compliance with restrictive covenants, the Grantee shall become vested in a pro-rata portion of the Performance Units. The pro-rata portion shall be determined by multiplying (x) the Target Award by (y) a fraction, (I) the numerator of which is the number of days of continuous service performed by the Grantee for the Employer during the period beginning January 1, 2013 and ending on the Service Date (the " Performance Period "), and (II) the denominator of which is 1095. Any Performance Units that do not vest in connection with such death or Disability shall be forfeited as of the date the Grantee's service ceases and the Grantee shall not have any further rights with respect to those units.
3. If the Grantee ceases to perform services for the Employer prior to the Service Date on account of (i) a termination by the Employer without "cause" (as defined in the Employment Agreement), or (ii) the resignation by the Grantee with "good reason" (as defined in the Employment Agreement), then subject to satisfaction of the requirements contained in severance provisions of the Employment Agreement regarding execution of a release and compliance with restrictive covenants, the Grantee shall become vested in a number of Performance Units determined by multiplying (x) the number of Performance Units that would otherwise have vested under Paragraph 3(a), above (but for the cessation of the Grantee's service), by (y) a fraction, (I) he numerator of which is the number of days of continuous service performed by the Grantee for the Employer during the Performance Period, and (II) the denominator of which is 1095. Any Performance Units that cannot vest because of the pro-ration described above will be forfeited as of the date the Grantee's service ceases and the Grantee shall not have any further rights with respect to those units. Any Performance Units that do not vest because of the failure to fully satisfy the applicable performance goal shall be forfeited as of the Service Date and the Grantee shall not have any further rights with respect to those units.
4. If prior to the Service Date the Grantee's employment or service with the Employer ceases for any reason other than those described in Paragraphs 3(b) or 3(c), above, all the Performance Units shall be immediately forfeited and the Grantee shall not have any further rights with respect to this Grant.
4. Time and Form of Payment with Respect to Performance Units . The Grantee shall receive a distribution with respect to vested Performance Units within two and one-half months following the applicable vesting date (i.e., the Service Date, for Performance Units vesting pursuant to Section 3(a) or 3(c), or the date of cessation of the Grantee's service, for Performance Units vesting pursuant to Section 3(b)). The Performance Units will be distributed in shares of Company Stock, with each vested Performance Unit representing the right to receive one share of Company Stock.
5. Dividend Equivalents . At the same time that the Performance Units are converted to shares of Company Stock and distributed to the Grantee as set forth in Paragraph 4 above, the Company shall pay to the Grantee a lump sum cash payment equal to the sum of the dividends that would have been payable between January 1, 2013 and the date of such distribution with respect to a number of shares of Company Stock equal to the number of shares then distributable (equitable adjusted by the Committee to take into account any stock splits, reverse splits, mergers, recapitalizations or similar events occurring during such period).
6. Dissolution or Liquidation; Sale or Merger . The provisions of the Plan applicable to a dissolution, liquidation, sale or merger of the Company shall apply to the Grant, and, in the event of a dissolution, liquidation, sale or merger of the Company, the Committee may shorten the Performance Period and accelerate settlement of this Grant based on performance through the end of such abbreviated performance period or take such other actions as it deems appropriate and consistent with the Plan.
7. Acknowledgment by Grantee . By accepting this Grant, the Grantee acknowledges that with respect to any right to distribution and payment pursuant to this Grant, the Grantee is and shall be an unsecured general creditor of the Company without any preference as against other unsecured general creditors of the Company, and the Grantee hereby covenants for herself, and anyone at any time claiming through or under the Grantee, not to claim any such preference, and hereby disclaims and waives any such preference which may at any time be at issue, to the fullest extent permitted by applicable law. The Grantee also hereby agrees to be bound by the terms and conditions of the Plan and this Grant. The Grantee further agrees to be bound by the determinations and decisions of the Committee with respect to this Grant and the Plan and the Grantee's rights to benefits under this Grant and the Plan, and agrees that all such determinations and decisions of the Committee shall be binding on the Grantee, her beneficiaries and any other person having or claiming an interest under this Grant and the Plan on behalf of the Grantee.
8. Restrictions on Issuance or Transfer of Shares of Company Stock .
1. The obligation of the Company to deliver shares of Company Stock hereunder shall be subject to the condition that if at any time the Committee shall determine in its discretion that the listing, registration or qualification of the shares of Company Stock upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the issuance of shares of Company Stock, the shares of Company Stock may not be issued in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee. The issuance of shares of Company Stock and the payment of cash to the Grantee pursuant to this Grant is subject to any applicable taxes and other laws or regulations of the United States and of any state having jurisdiction thereof.
2. As a condition to the receipt of any shares of Company Stock upon distribution of the earned and vested Performance Units, the Grantee (i) agrees to be bound by the Company's policies, including, but not limited to, the Company's Insider Trading Policy, regarding the limitations on the transfer of such shares, and the Company's Clawback Policy and Anti-Hedging Policy, and (ii) understands that there may be certain times during the year that the Grantee will be prohibited from selling, transferring, donating, assigning, mortgaging, hypothecating or otherwise encumbering the shares.
9. Grant Subject to Plan Provisions . This Grant is made pursuant to the Plan, the terms of which are incorporated herein by reference, and in all respects shall be interpreted in accordance with the Plan. In the event of any contradiction, distinction or difference between this Grant and the terms of the Plan, the terms of the Plan will control. Except as otherwise defined in this Grant, capitalized terms used in this Grant shall have the meanings set forth in the Plan. This Grant is subject to the interpretations, regulations and determinations concerning the Plan established from time to time by the Committee in accordance with the provisions of the Plan, including, but not limited to, provisions pertaining to (a) rights and obligations with respect to withholding taxes, (b) the registration, qualification or listing of the shares of Company Stock, (c) changes in capitalization of the Company, and (d) other requirements of applicable law. The Committee shall have the authority to interpret and construe this Grant pursuant to the terms of the Plan, its decisions shall be conclusive as to any questions arising hereunder and the Grantee's acceptance of this Grant is the Grantee's agreement to be bound by the interpretations and decisions of the Committee with respect to this Grant and the Plan.
10. No Rights as Stockholder . The Grantee shall not have any rights as a stockholder of the Company, including the right to any cash dividends (except as provided in Paragraph 5 hereof) or the right to vote, with respect to any Performance Units.
11. No Rights to Continued Employment or Service . This Grant shall not confer upon the Grantee any right to be retained in the employment or service of the Employer and shall not interfere in any way with the right of the Employer to terminate the Grantee's employment or service at any time. The right of the Employer to terminate at will the Grantee's employment or service at any time for any reason is specifically reserved.
12. Confidential Information, Non-Competition and Non-Solicitation .  The Grantee reaffirms and acknowledges the Grantee's obligations under the Nondisclosure and Noncompete Agreement for Management Employees.
13. Assignment and Transfers . No Performance Units or dividend equivalents awarded to the Grantee under this Grant may be transferred, assigned, pledged, or encumbered by the Grantee and the Performance Units and dividend equivalents shall be distributed during the lifetime of the Grantee only for the benefit of the Grantee. Any attempt to transfer, assign, pledge, or encumber the Performance Units or dividend equivalents under this Grant by the Grantee shall be null, void and without effect. The rights and protections of the Company hereunder shall extend to any successors or assigns of the Company. This Grant may be assigned by the Company without the Grantee's consent.
14. Withholding . The Grantee shall be required to pay to the Employer, or make other arrangements satisfactory to the Employer to provide for the payment of, any federal, state, local or other taxes that the Employer is required to withhold with respect to the grant, vesting and distribution of the Performance Units and dividend equivalents. Subject to Committee approval, the Grantee may elect to satisfy any tax withholding obligation of the Employer with respect to the distribution of shares of Company Stock pursuant to the Performance Units that are earned by the Grantee under this Grant by having shares of Company Stock withheld up to an amount that does not exceed the minimum applicable withholding tax rate for federal (including FICA), state, local and other tax liabilities. Notwithstanding anything to the contrary herein or the Plan, until the Grantee has satisfied the Employer's withholding obligation with respect to the shares of Company Stock as described in this Paragraph 14 , the Grantee shall not have any rights to sell or transfer any shares of Company Stock that have been distributed to the Grantee pursuant to Paragraph 4 above.
15. Effect on Other Benefits . The value of this Grant and the shares of Company Stock and dividend equivalents potentially distributable hereunder shall not be considered eligible earnings for purposes of any other plan maintained by the Company or the Employer, and such value shall not be considered part of the Grantee's compensation for purposes of determining or calculating other benefits that are based on compensation, such as life insurance.
16. Applicable Law . The validity, construction, interpretation and effect of this Grant shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to the conflicts of laws provisions thereof.
17. Notice . Notices permitted or required under this Agreement shall be in writing and shall be deemed to have been duly given when delivered by hand or overnight courier addressed, in the case of the Company, c/o its General Counsel at its principal executive office and, in the case of the Grantee, to her most recent address set forth in the personnel records of the Company.
18. Contents of Agreement; Amendment . This Grant, including the terms of the Employment Agreement specifically incorporated by reference in Sections 3(b) and 3(c), represents the entire agreement between the parties hereto relating to the subject matter hereof, and merges and supersedes all prior and contemporaneous discussions, agreements and understandings of every nature relating to the subject matter hereof. This Grant agreement cannot be changed, modified, extended or terminated except upon written amendment executed by the parties hereto. Any such written amendment must be approved by the Committee to be effective against the Company.
19. Consent to Electronic Delivery . The Grantee hereby authorizes the Company to deliver electronically any prospectuses or other documentation related to this Grant agreement, the Plan and any other compensation or benefit plan or arrangement in effect from time to time (including, without limitation, reports, proxy statements or other documents that are required to be delivered to participants in such plans or arrangements pursuant to federal or state laws, rules or regulations). For this purpose, electronic delivery will include, without limitation, delivery by means of e-mail or e-mail notification that such documentation is available on the Company's intranet site. Upon written request, the Company will provide to the Grantee a paper copy of any document also delivered to the Grantee electronically. The authorization described in this paragraph may be revoked by the Grantee at any time by written notice to the Company.

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IN WITNESS WHEREOF, the Company has caused its duly authorized officer to execute and attest this instrument, and the Grantee has placed his or her signature hereon, on this ___ day of November, 2012.

I hereby accept the grant of Performance Units described in this Grant, and I agree to be bound by the terms of the Plan and this Grant. I hereby further agree that all of the decisions and determinations of the Committee shall be final and binding.

The performance measure applicable to the award of PRSUs shall be based on the Company's Total Shareholder Return ("TSR") over the three year Performance Period relative to the TSR of the Russell 3000 Index for the same Performance Period. For these purposes, the TSR shall be determined based on the change in the stock price of, and the dividends and distributions paid by, the relevant entity during the Performance Period. At the end of the Performance Period, the Company's TSR performance relative to the TSR performance of the companies in the Russell 3000 Index shall be determined and the PRSUs shall vest and become payable, if at all, based on the following schedule:

If the Company's relative TSR results for the Performance Period are either (a) between the 35 ^th percentile and the 50 ^th percentile or (b) between the 50 ^th percentile and the 85 ^th percentile, then, in either such case, the percentage of the Target Award that shall become vested and payable shall be determined by linear interpolation.

NutriSystem, Inc.

600 Office Center Drive

Ft. Washington, PA 19034

Via Hand Delivery

Mr. Joseph M. Redling

Dear Joe:

Reference is hereby made to the letter agreement between us dated April 4, 2012 and amended on September 27, 2012 (the "Amended Letter Agreement"). As you know, the Amended Letter Agreement contemplated the cessation of your service to the Company on the "Cessation Date," which term was defined as November 2, 2012 or such earlier date requested by the Company on 15 days prior written notice. To enable the Company to complete the hiring process for its new Chief Executive Officer , you have agreed to extend the Cessation Date to November 9, 2012.

On the Cessation Date, as redefined by this letter, your service to the Company will cease on the terms described in the Amended Letter Agreement; provided that, the date "November 2, 2012" in the second sentence of the fourth paragraph of the Amended Letter Agreement is hereby replaced with "November 9, 2012."

To confirm that this letter accurately reflects our agreement, please countersign it in the space provided below and return it to me.

Agreed on this 1 ^st day of November, 2012:

/s/ Joseph M. Redling ___________

Joseph M. Redling