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Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 12, 2006
Town Sports International Holdings, Inc.
(Exact Name of Registrant as Specified in its Charter)
Delaware
(State or other Jurisdiction
of Incorporation)
333-114210
(Commission File Number)
20-0640002
(I.R.S. Employer
Identification No.)
888 Seventh Avenue, New York, New York
10106
(Address of Principal Executive Offices)
(Zip Code)
Registrant’s telephone number, including area code: (212) 246-6700
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
 Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
TABLE OF CONTENTS
Item 1.01. Entry into a Material Definitive Agreement.
Item 8.01 Other Events.
ITEM 9.01. Financial Statements and Exhibits.
SIGNATURE
EXHIBIT INDEX
EX-4.1: SUPPLEMENTAL INDENTURE
EX-99.1: PRESS RELEASE
Table of Contents
Item 1.01. Entry into a Material Definitive Agreement.
On May 12, 2006, Town Sports International, Inc. (the “Company”), a wholly owned subsidiary of Town Sports International
Holdings, Inc. announced that consents had been obtained from the holders of approximately $235.6 million in principal amount of the
$255 million total outstanding 9 5/8% Senior Notes due 2011 (the “Notes”) pursuant to its previously announced consent solicitation,
which expired at 5:00 p.m., New York City time on May 12, 2006. Each consenting holder of the Notes agreed to certain proposed
amendments and a waiver relating to the indenture governing the Notes (the “Indenture”).
Accordingly, on May 12, 2006, the Company, as issuer and The Bank of New York, as trustee entered into a supplemental
indenture (the “Supplemental Indenture”). The Supplemental Indenture provides that (i) the Company shall not be required to
(1) furnish the holders or the trustee certain reports, statements and other documents described in the Indenture, or (2) file a copy of
any such reports, statements and other documents with the Securities and Exchange Commission, or make such information available
to securities analysts and prospective investors, in each case if the Company is a subsidiary of any Person that files reports, statements
or other documents with the Securities and Exchange Commission that, when required by the rules and regulations of the Securities
and Exchange Commission, include condensed consolidating financial information with respect to the Company and such reports,
statements or other documents are filed within the time periods specified in the Securities and Exchange Commission’s rules and
regulations, (ii) the Company and any guarantor that is a corporation may convert into a limited liability company form of
organization and (iii) the Company may merge into a limited liability company form of organization.
This description of the Supplemental Indenture is qualified in its entirety by reference to its complete text of the Supplemental
Indenture, which is filed as Exhibit 4.1 to this report.
Item 8.01 Other Events.
On May 15, 2006, the Company issued a press release announcing the expiration, as of 5:00 p.m. (New York city time), of the
deadline for holders of the Notes to receive the early tender payment in connection with the Company’s previously announced cash
tender offer and completion of the previously announced consent solicitation. A copy of this press release is being furnished as
Exhibit 99.1 to this report.
ITEM 9.01. Financial Statements and Exhibits.
(d) Exhibits.
4.1 Supplemental Indenture, dated as of May 12, 2006, between Town Sports International, Inc., as issuer and The Bank of
New York, as trustee.
99.1 Press Release dated May 15, 2006.
Table of Contents
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
TOWN SPORTS INTERNATIONAL HOLDINGS, INC.
(Registrant)
Date: May 15, 2006
By:
/s/ RICHARD PYLE
Richard Pyle
Chief Financial Officer
Table of Contents
4.1
EXHIBIT INDEX
Supplemental Indenture, dated as of May 12, 2006, between Town Sports International, Inc., as issuer and The Bank of New
York, as trustee.
99.1 Press Release dated May 15, 2006.
TOWN SPORTS INTERNATIONAL, INC.
as Issuer
Supplemental Indenture
Dated as of May 12, 2006
Supplementing the Indenture
Dated as of April 16, 2003
with respect to $255,000,000
9 5/8% Senior Notes due 2011
The Bank of New York,
as Trustee
SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE, dated as of May 12, 2006 (this “Supplemental Indenture”), made between Town Sports
International Inc., a New York corporation (the “ Company ”) and The Bank of New York, as Trustee (the “ Trustee ”) to the Original
Indenture (as defined).
RECITALS
WHEREAS, the Company, certain Guarantors and the Trustee have heretofore entered into an Indenture dated as of April 16,
2003 (the “Original Indenture”), pursuant to the provisions of which the Company has heretofore issued $255,000,000 in aggregate
principal amount of its 9 5/8% Senior Notes due 2011 (the “ Notes ”);
WHEREAS the Company and the Trustee desire to amend and supplement the Original Indenture in accordance with its terms;
WHEREAS, the Company commenced a tender offer (the “Tender Offer”) for up to $85,000,000 aggregate principal amount of
the Notes on May 4, 2006, and in conjunction with the Tender Offer solicited consents to the adoption of certain proposed
amendments to the Original Indenture (the “ Solicitation ”).
WHEREAS, Section 9.2 of the Original Indenture provides that the Original Indenture may be amended or supplemented with
the consent of the holders of at least a majority in principal amount of the Notes then outstanding;
WHEREAS, pursuant to the Solicitation, holders of more than a majority in principal amount of Notes then outstanding validly
delivered consents to the proposed amendments to the Original Indenture; and
WHEREAS, all conditions and requirements necessary to authorize the execution and delivery of this Supplemental Indenture
have been duly complied with or done and performed by the Company, and all actions necessary to make this Supplemental Indenture
and the Original Indenture, as supplemented by this Supplemental Indenture, valid, binding and legal instruments according to their
terms (and, with respect to this Supplemental Indenture, in accordance with the terms of the Original Indenture) have been complied
with or done and performed;
NOW, THEREFORE, for and in consideration of the premises and of the mutual covenants herein contained, and for other
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Guarantors covenant and
agree with the Trustee, for the benefit of all present and future Holders of the Notes, as follows:
Section 1. Section 4.3 of the Original Indenture is hereby amended and replaced in its entirety by the following text:
SECTION 4.3. Reports to Holders.
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Whether or not required by the rules and regulations of the Commission, so long as any Notes are outstanding, the Company will
furnish the Holders, with a copy to the Trustee:
(i) all quarterly and annual financial information that would be required to be contained in a filing with the Commission on Forms
10-Q and 10-K if the Company were required to file such Forms, including a “Management’s Discussion and Analysis of Financial
Condition and Results of Operations’’ that describes the financial condition and results of operations of the Company and its
consolidated Subsidiaries (showing in reasonable detail, either on the face of the financial statements or in the footnotes thereto and
in “Management’s Discussion and Analysis of Financial Condition and Result of Operations,’’ the financial condition and results of
operations of the Company and its Restricted Subsidiaries separate from the financial condition and results of operations of the
Unrestricted Subsidiaries of the Company, if any) and, with respect to the annual information only, a report thereon by the
Company’s certified independent accountants; and
(ii) the information that would be required to be included in all current reports that would be required to be filed with the
Commission on Form 8-K if the Company were required to file such reports, in each case within the time periods specified in the
Commission’s rules and regulations.
In addition, following the consummation of the Exchange Offer, whether or not required by the rules and regulations of the
Commission, the Company will file a copy of all such information and reports with the Commission for public availability within the
time periods specified in the Commission’s rules and regulations (unless the Commission will not accept such a filing) and make such
information available to securities analysts and prospective investors upon request. In addition, the Company has agreed that, for so
long as any Notes remain outstanding, it will furnish to the Holders and to securities analysts and prospective investors, upon their
request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
Notwithstanding the foregoing, the Company shall not be required to (1) furnish the Holders or the Trustee any of the information
described in clauses (i) and (ii) above, or (2) file a copy of any such information or reports with the Commission, or make such
information available to securities analysts and prospective investors, in each case if the Company is a Subsidiary of any Person that
files reports, statements or other documents with the Commission that, when required by the rules and regulations of the Commission,
include condensed consolidating financial information with respect to the Company and such reports, statements or other documents
are filed within the time periods specified in the Commission’s rules and regulations.
Section 2. Section 4.13 of the Original Indenture is hereby amended and replaced in its entirety by the following text:
SECTION 4.13. Continued Existence.
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Subject to Article V, each of the Company and the Guarantors shall do or cause to be done all things necessary to preserve and
keep in full force and effect (i) its corporate or other existence in accordance with the organizational documents (as the same may be
amended from time to time) of the Company or such Guarantor and (ii) the material rights (charter or statutory), licenses and
franchises of the Company or such Guarantor, except to the extent that the applicable Board of Directors determines in good faith that
the preservation of such right, license or franchise, or the existence of any such Guarantor, in either case is no longer necessary or
desirable in the conduct of the business of the Company or such Guarantor and that the loss thereof is not disadvantageous in any
material respect to the Holders. Notwithstanding the foregoing and for avoidance of doubt, the Company and any Guarantor that is a
corporation may convert into a limited liability company form of organization.
Section 3. Section 5.1 of the Original Indenture is hereby amended and replaced in its entirety by the following text:
SECTION 5.1. Merger, Consolidation and Sale of Assets.
The Company will not, in a single transaction or series of related transactions, consolidate or merge with or into any Person, or sell,
assign, transfer, lease, convey or otherwise dispose of (or cause or permit any Restricted Subsidiary to sell, assign, transfer, lease,
convey or otherwise dispose of) all or substantially all of the Company’s assets (determined on a consolidated basis for the Company
and its Restricted Subsidiaries) whether as an entirety or substantially as an entirety to any Person, unless:
(1) either:
(a) the Company shall be the surviving or continuing entity; or
(b) the Person (if other than the Company) formed by such consolidation or into which the Company is merged or the Person
which acquires by sale, assignment, transfer, lease, conveyance or other disposition the properties and assets of the Company and of
its Restricted Subsidiaries substantially as an entirety (the “Surviving Entity’’):
(x) will be an entity organized or formed and validly existing under the laws of the United States or any State thereof or the
District of Columbia; and
(y) will expressly assume, by supplemental indenture (in form and substance reasonably satisfactory to the Trustee), executed
and delivered to the Trustee, the due and punctual payment of the principal of and premium, if any, and interest on all of the Notes
and the performance of every covenant of the Notes, this Indenture and the Registration Rights Agreement on the part of the
Company to be performed or observed;
(2) immediately after giving effect to such transaction and the assumption contemplated by clause (1)(b)(y) above (including
giving effect to any Indebtedness and
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Acquired Indebtedness incurred or anticipated to be incurred in connection with or in respect of such transaction), the Company or
such Surviving Entity, as the case may be, shall be able to incur at least $1.00 of additional Indebtedness (other than Permitted
Indebtedness) pursuant to Section 4.9;
(3) immediately before and immediately after giving effect to such transaction and the assumption contemplated by clause
(1)(b)(y) above (including, without limitation, giving effect to any Indebtedness and Acquired Indebtedness incurred or anticipated to
be incurred and any Lien granted in connection with or in respect of the transaction), no Default or Event of Default shall have
occurred or be continuing; and
(4) the Company or the Surviving Entity shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel,
each stating that such consolidation, merger, sale, assignment, transfer, lease, conveyance or other disposition and, if a supplemental
indenture is required in connection with such transaction, such supplemental indenture comply with the applicable provisions of this
Indenture and that all conditions precedent in this Indenture relating to such transaction have been satisfied.
For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a single transaction or series of transactions)
of all or substantially all of the properties or assets of one or more Restricted Subsidiaries, the Capital Stock of which constitutes all or
substantially all of the properties and assets of the Company, will be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
Upon any consolidation, combination or merger or any transfer of all or substantially all of the assets of the Company in
accordance with the foregoing in which the Company is not the continuing entity, the Surviving Entity shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under this Indenture and the Notes with the same effect as if
such Surviving Entity had been named as such.
Each Guarantor (other than any Guarantor whose Guarantee is to be released in accordance with the terms of the Guarantee and
this Indenture in connection with any transaction complying with the provisions of Section 4.10) will not, and the Company will not
cause or permit any Guarantor to, consolidate with or merge with or into any Person other than the Company or any other Guarantor
unless:
(1) the entity formed by or surviving any such consolidation or merger (if other than the Guarantor) or to which such sale, lease,
conveyance or other disposition shall have been made is a corporation, limited liability company or partnership organized and
existing under the laws of the United States or any State thereof or the District of Columbia;
(2) such entity assumes by supplemental indenture all of the obligations of the Guarantor on the Guarantee; and
(3) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing.
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Any merger or consolidation of a Guarantor with and into the Company (with the Company being the surviving entity) or another
Guarantor that is a Restricted Subsidiary need only comply with clause (4) of the first paragraph of this Section 5.1.
Section 4. This Supplemental Indenture is a supplemental indenture pursuant to Section 9.2 of the Original Indenture. Upon
execution and delivery of this Supplemental Indenture, all the terms and conditions of the Original Indenture and this Supplemental
Indenture shall be read together as though they constitute one instrument, except that in case of conflict, the provisions of this
Supplemental Indenture will control.
Section 5. Except as they have been modified in this Supplemental Indenture, each and every term and provision of the Original
Indenture shall continue in full force and effect, and all references to the Indenture in the Original Indenture shall hereafter be deemed
to mean the Original Indenture as supplemented and amended pursuant to this Supplemental Indenture.
Section 6. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but
all of them together shall represent the same agreement.
Section 7. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD
BE REQUIRED THEREBY. THE COMPANY HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW
YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS SUPPLEMENTAL INDENTURE, AND
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,
JURISDICTION OF THE AFORESAID COURTS. THE COMPANY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
THAT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, TRIAL BY JURY AND ANY OBJECTION WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING HEREIN SHALL AFFECT THE
RIGHT OF THE TRUSTEE OR ANY HOLDER OF THE NOTES TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY IN
ANY OTHER JURISDICTION.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first
written above.
TOWN SPORTS INTERNATIONAL, INC.
By:
/s/ Richard Pyle
Name: Richard Pyle
Title: Chief Financial Officer
THE BANK OF NEW YORK,
as Trustee
By:
/s/ Julie Salovitch-Miller
Name: Julie Salovitch-Miller
Title: Vice President
Town Sports International, Inc. Announces Expiration of Early Tender Payment Deadline in Connection
with Cash Tender Offer for Outstanding Debt Securities and Successful Completion of the Consent
Solicitation
NEW YORK, May 15, 2006 —Town Sports International, Inc. (the “Company”) announced today the expiration, as of 5:00 p.m.
(New York City time), of the deadline (the “Early Tender Payment Deadline”) for holders of the Company’s 9 5/8% senior notes due
2011 (“Notes”) to receive the early tender payment in connection with the Company’s previously announced cash tender offer (the
“Tender Offer”). The Tender Offer will expire at Midnight, New York City time, on June 1, 2006, unless extended or earlier
terminated (the “Expiration Date”). Holders that validly tender their Notes after the Early Tender Payment Deadline will be entitled to
the regular tender payment of $1,065.04 per $1,000 principal amount of Notes tendered. Acceptance of the Notes for purchase will be
subject to pro-ration as described in the Offer to Purchase and Consent Solicitation Statement (the “Statement”).
The Company also announced the successful completion of the consent solicitation.
As of 5:00 p.m. (New York city time) on May 12, 2006, approximately $235.6 million aggregate principal amount of Notes had been
validly tendered and corresponding consents to the proposed amendments to the indenture under which the Notes were issued (the
“Indenture”) and the waiver of any defaults or events of default thereunder had been validly delivered.
The proposed amendments became effective by a supplemental indenture, dated as of May 12, 2006 (the “Effective Date”) executed
by the Company and The Bank of New York, as trustee under the Indenture. As of the Effective Date, the Indenture has been amended
to allow the Company to omit financial statements and not file reports under the Securities Exchange Act of 1934 with the Securities
and Exchange Commission (the “SEC”) for so long as the Company’s parent, Town Sports International Holdings, Inc. includes a
footnote presenting condensed consolidating financial information of the Company in the reports, statements and other documents that
it files with the SEC and such filings are made within the periods specified in the SEC’s rules and regulations. In addition, the
Indenture has been amended to permit the Company to convert into a limited liability company form of organization. The Note
holders also waived any past defaults and events of default under the Indenture in connection with the Company’s reliance on the
reports, statements and other documents that its parent company files with the SEC to satisfy its filing and reporting obligations under
the Indenture.
The Company has engaged Deutsche Bank Securities Inc. to act as the exclusive dealer manager and consent solicitation agent for the
Tender Offer and Consent Solicitation. Copies of the Statement and Letter of Transmittal and Consent may be obtained from, and
questions regarding the Tender Offer and Consent Solicitation may be directed to, the information agent, MacKenzie Partners, Inc.,
which can be reached at (212) 929-5500 (collect) and toll-free at (800) 322-2885. For questions concerning delivery by means of the
Automated Tender Offer Program please contact The Bank of New York, the Depositary for the Tender Offer and the Solicitation, at
(212) 815-6331.
This press release is for informational purposes only and is not an offer to purchase any Notes. The offer may be made only pursuant
to the terms of the Statement and Letter of Transmittal and Consent.
About Town Sports International, Inc.:
The Company is a wholly owned subsidiary of Town Sports International Holdings, Inc.
About Town Sports International Holdings, Inc.:
New York-based Town Sports International Holdings, Inc. is a leading owner and operator of health clubs in the Northeast and
mid-Atlantic regions of the United States. In addition to New York Sports Clubs, TSI operates under the brand names of Boston
Sports Clubs, Washington Sports Clubs and Philadelphia Sports Clubs, with 142 clubs and 432,000 members in the U.S. In addition,
the Company operates three facilities in Switzerland with approximately 6,000 members. For more information on TSI visit
www.mysportsclubs.com
Town Sports International Holdings, Inc., New York
Investor Contact:
Integrated Corporate Relations
[email protected] or
[email protected]
This press release may contain forward-looking statements that are subject to certain risks, uncertainties and assumptions, including
the ability to satisfy the conditions to consummate the Tender Offer. Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated, or projected.