Exhibit 10.1
THIRD AMENDMENT
     THIRD AMENDMENT (this “Amendment”), dated as of July 7, 2006, among TOWN
SPORTS INTERNATIONAL HOLDINGS, INC. (“Holdco”), TOWN SPORTS INTERNATIONAL, LLC
(f/k/a TOWN SPORTS INTERNATIONAL, INC.) (the “Borrower”), the financial
institutions party to the Credit Agreement referred to below (the “Lenders”),
and DEUTSCHE BANK TRUST COMPANY AMERICAS, as Administrative Agent (in such
capacity, the “Administrative Agent”), and acknowledged and agreed to by each of
the Subsidiary Guarantors. All capitalized terms used herein and not otherwise
defined herein shall have the respective meanings provided such terms in the
Credit Agreement referred to below.
W I T N E S S E T H:
     WHEREAS, the Borrower, the Lenders and the Administrative Agent are parties
to a Credit Agreement, dated as of April 16, 2003 (as amended, modified and/or
supplemented to, but not including, the date hereof, the “Credit Agreement”);
     WHEREAS, the Borrower has requested, and the Lenders have agreed, that the
Total Revolving Loan Commitment be increased as provided herein; and
     WHEREAS, subject to the terms and conditions of this Amendment, the parties
hereto agree as follows;
     NOW, THEREFORE, it is agreed:
     1. As of the Third Amendment Effective Date (as defined below), the Total
Revolving Loan Commitment will be increased from $50,000,000 to $75,000,000, as
such amount may be reduced from time to time after the Third Amendment Effective
Date pursuant to the terms of the Credit Agreement.
     2. To the extent that any Revolving Loans are outstanding on the Third
Amendment Effective Date (and after such effect thereto), the Borrower shall, in
coordination with the Administrative Agent, repay outstanding Revolving Loans of
certain of the Lenders, and incur additional Revolving Loans from certain other
Lenders (including the New Lenders), in each case to the extent necessary so
that all of the Lenders participate in each outstanding Borrowing of Revolving
Loans pro rata on the basis of their respective Revolving Loan Commitments
(after giving effect to any increase in the Total Revolving Loan Commitment
pursuant to this Amendment) and with the Borrower being obligated to pay to the
respective Lenders any costs of the type referred to in Section 1.11 in
connection with any such repayment and/or incurrence. For the avoidance of
doubt, with respect to all Letters of Credit outstanding on the Third Amendment
Effective Date and any Unpaid Drawings relating thereto, there shall be an
automatic adjustment to the participations pursuant to Section 2.04 of the
Credit Agreement to reflect the new Percentages of the Lenders after giving
effect to the Third Amendment Effective Date.

 

--------------------------------------------------------------------------------

 

     3. Schedule I to the Credit Agreement is hereby amended by replacing such
Schedule in its entirety with the Schedule I attached hereto.
     4. This Amendment shall become effective on the date (the “Third Amendment
Effective Date”) when:
          (A) Holdco, the Borrower, the Subsidiary Guarantors, the Required
Lenders, each Lender whose Revolving Loan Commitment is being increased hereby
(each an “Increased Lender”) and each Lender who has signed a counterpart of
this Amendment and is not a Lender immediately prior to giving effect to the
Third Amendment Effective Date (each a “New Lender’) shall have signed a
counterpart hereof (whether the same or different counterparts) and shall have
delivered (including by way of facsimile transmission) the same to the
Administrative Agent at the Notice Office; and
          (B) the Borrower shall have paid to (x) each Increased Lender, a
non-refundable cash fee in an amount equal to 0.50% of the amount by which such
Increased Lender’s Revolving Loan Commitment is increased on the Third Amendment
Effective Date and (y) each New Lender, a non-refundable cash fee in an amount
equal to 0.50% of such New Lender’s Revolving Loan Commitment on the Third
Amendment Effective Date, all of which fees shall be paid by the Borrower to the
Administrative Agent for distribution to the Lenders entitled thereto.
     5. Each New Lender (a) agrees that from and after the Third Amendment
Effective Date, it shall be bound by the provisions of the Credit Agreement and,
to the extent of its Revolving Loan Commitment, shall have the obligations of a
Lender thereunder, (b) if it is organized under the laws of a jurisdiction
outside the United States, represents and warrants that it has delivered any tax
documentation required to be delivered by it pursuant to the terms of the Credit
Agreement, duly completed and executed by it, (c) appoints and authorizes each
of the Administrative Agent and the Collateral Agent to take such action as
agent on its behalf and to exercise such powers under the Credit Agreement and
the other Credit Documents as are delegated to or otherwise conferred upon the
Administrative Agent or the Collateral Agent, as the case may be, by the terms
thereof, together with such powers as are reasonably incidental thereto and
(d) agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Credit Documents are required to be
performed by it as a Lender.
     6. In order to induce the Lenders to enter into this Amendment, the
Borrower hereby represents and warrants that (i) no Default or Event of Default
exists on the Third Amendment Effective Date, both before and after giving
effect to this Amendment, and (ii) on the Third Amendment Effective Date, both
before and after giving effect to this Amendment, all representations and
warranties contained in the Credit Agreement and in the other Credit Documents
are true and correct in all material respects (it being understood and agreed
that any representation or warranty which by its terms is made as of a specified
date shall be required to be true and correct in all material respects only as
of such specified date).
     7. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which counterparts
when executed and delivered shall be an original, but all of which shall
together constitute one and the same

-2-

--------------------------------------------------------------------------------

 

instrument. A complete set of counterparts shall be delivered to the Borrower
and the Administrative Agent.
     8. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.
     9. From and after the Third Amendment Effective Date, all references in the
Credit Agreement and each of the other Credit Documents to the Credit Agreement
shall be deemed to be references to the Credit Agreement as modified hereby.
     10. This Amendment is limited as specified and shall not constitute a
modification, acceptance or waiver of any other provision of the Credit
Agreement or any other Credit Document.
* * *

-3-

--------------------------------------------------------------------------------

 

     IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of
this Amendment to be duly executed and delivered as of the date first above
written.

                      TOWN SPORTS INTERNATIONAL, LLC    
 
      By:   Town Sports International Holdings, Inc.,
Its Sole Member    
 
               
 
      By:       /s/ Richard G. Pyle    
 
               
 
          Name: Richard G. Pyle    
 
          Title: CFO    
 
                    TOWN SPORTS INTERNATIONAL HOLDINGS, INC.    
 
                    By:       /s/ Richard G. Pyle                          
Name: Richard G. Pyle             Title: CFO    

 

--------------------------------------------------------------------------------

 

            DEUTSCHE BANK TRUST COMPANY AMERICAS, Individually and as
Administrative Agent
      By:   /s/ Carin Keegan         Name:   Carin Keegan        Title:   Vice
President              By:   /s/ Evelyn Thierry         Name:   Evelyn Thierry 
      Title:   Vice President     

 

--------------------------------------------------------------------------------

 

            BNP PARIBAS
      By:   /s/ Charles Romano         Name:   Charles Romano        Title:  
Vice President              By:   /s/ Cecile Scherer         Name:   Cecile
Scherer        Title:   Director Merchant Banking Group     

 

--------------------------------------------------------------------------------

 

            CIT LENDING SERVICES CORPORATION
      By:   /s/ David Manheim         Name:   David Manheim        Title:   Vice
President     

 

--------------------------------------------------------------------------------

 

            MERRILL LYNCH CAPITAL , a division of
MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC.
      By:   /s/ F. Delangle         Name:   F. Delangle        Title:   Vice
President     

 

--------------------------------------------------------------------------------

 

            CREDIT SUISSE
      By:   /s/ Bill O’Daly         Name:   Bill O’Daly        Title:  
Director              By:   /s/ Phillip Ho         Name:   Phillip Ho       
Title:   Director     

 

--------------------------------------------------------------------------------

 

            GOLDMAN SACHS CREDIT PARTNERS, L.P.
      By:   /s/ William W. Archer         Name:   William W. Archer       
Title:   Managing Director     

 

--------------------------------------------------------------------------------

 

            ROYAL BANK OF CANADA
      By:   /s/ William J. Cegglano         Name:   William J. Cegglano       
Title:   Authorized Signatory     

 

--------------------------------------------------------------------------------

 

Acknowledged and Agreed to:
TSI 217 Broadway, Inc.
TSI Andover, Inc.
TSI Arthro-Fitness Services, Inc.
TSI Astoria, Inc.
TSI Battery Park, Inc.
TSI Bayridge, Inc.
TSI Boylston, Inc.
TSI Broadway, Inc.
TSI Brooklyn Belt, Inc.
TSI Brunswick, Inc.
TSI Cash Management, Inc.
TSI Chevy Chase, Inc.
TSI Coble Hill, Inc.
TSI Columbia Heights, Inc.
TSI Commack, Inc.
TSI Connecticut Avenue, Inc.
TSI Copley, Inc.
TSI Court Street, Inc.
TSI Croton, Inc.
TSI Danbury, Inc.
TSI Danvers, Inc.
TSI Downtown Crossing, Inc.
TSI Dupont Circle, Inc.
TSI Dupont II, Inc.
TSI East Cambridge, Inc.
TSI East Meadow, Inc.
TSI East 23, Inc.
TSI East 31, Inc.
TSI East 34, Inc.
TSI East 36, Inc.
TSI 41, Inc.
TSI East 51, Inc.
TSI, East 59, Inc.
TSI East 76, Inc.
TSI East 91, Inc.
TSI F Street, Inc.
TSI Fifth Avenue, Inc.
TSI First Avenue, Inc.
TSI Forest Hills, Inc.
TSI Framingham, Inc.

         
By:
  /s/ Richard G. Pyle    
 
       
 
  Name: Richard G. Pyle    
 
  Title: CFO    

 

--------------------------------------------------------------------------------

 

TSI Franklin (MA), Inc.
TSI Gallery Place, Inc.
TSI Garden City, Inc.
TSI Georgetown, Inc.
TSI Glover, Inc.
TSI Grand Central, Inc.
TSI Great Neck, Inc.
TSI Greenwich, Inc.
TSI Hartsdale, Inc.
TSI Hawthorne, Inc.
TSI Herald, Inc.
TSI Holding (CIP), Inc.
TSI Holdings (DC), Inc.
TSI Holdings (MA), Inc.
TSI Holdings (MD), Inc.
TSI Holdings (PA), Inc.
TSI Holdings (VA), Inc.
TSI Huntington, Inc.
TSI Insurance, Inc.
TSI International, Inc.
TSI Irving Place, Inc.
TSI K Street, Inc.
TSI Larchmont, Inc.
TSI Lexington (MA), Inc.
TSI Lincoln, Inc.
TSI Long Beach, Inc.
TSI Lynnfield, Inc.
TSI M Street, Inc.
TSI Madison, Inc.
TSI Mamaroneck, Inc.
TSI Mercer Street, Inc.
TSI Midwood, Inc.
TSI Murray Hill, Inc.
TSI Nanuet, Inc.
TSI Natick, Inc.
TSI Newbury Street, Inc.
TSI Oceanside, Inc.
TSI Port Jefferson, Inc.
TSI Reade Street, Inc.
TSI Rego Park, Inc.
TSI Rye, Inc.
TSI Scarsdale, Inc.

         
By:
  /s/ Richard G. Pyle    
 
       
 
  Name: Richard G. Pyle    
 
  Title: CFO    

 

--------------------------------------------------------------------------------

 

TSI Seaport, Inc.
TSI Sheriden, Inc.
TSI Smithtown, Inc.
TSI Soho, Inc.
TSI Somers, Inc.
TSI South End, Inc.
TSI South Park Slope, Inc.
TSI South Station, Inc.
TSI Stamford Downtown, Inc.
TSI Stamford Post, Inc.
TSI Stamford Rinks, Inc.
TSI Staten Island, Inc.
TSI Supplements, Inc.
TSI Syosset, Inc.
TSI University Management, Inc.
TSI Varick Street, Inc.
TSI Wall Street, Inc.
TSI Washington, Inc.
TSI Watertown, Inc.
TSI Wellesley, Inc.
TSI West Newton, Inc.
TSI West Nyack, Inc.
TSI West 14, Inc.
TSI West 16, Inc.
TSI West 23, Inc.
TSI West 38, Inc.
TSI West 41, Inc.
TSI West 44, Inc.
TSI West 48, Inc.
TSI West 52, Inc.
TSI West 73, Inc.
TSI West 76, Inc.
TSI West 80, Inc.
TSI West 94, Inc.
TSI West 125, Inc.
TSI Westport, Inc.
TSI Weymouth, Inc.
TSI White Plains City Center, Inc.
TSI White Plains, Inc.
TSI Whitestone, Inc.
TSI Woodmere, Inc.

         
By:
  /s/ Richard G. Pyle    
 
       
 
  Name: Richard G. Pyle    
 
  Title: CFO    

 

--------------------------------------------------------------------------------

 

TSI Alexandria, LLC
TSI Allston, LLC
TSI Ardmore, LLC
TSI Bethesda, LLC
TSI Bulfinch, LLC
TSI Central Square, LLC
TSI Centreville, LLC
TSI Cherry Hill, LLC
TSI Clarendon, LLC
TSI Colonia, LLC
TSI Davis Square, LLC
TSI Dobbs Ferry, LLC
TSI East 48, LLC
TSI East 86, LLC
TSI Englewood, LLC
TSI Fairfax, LLC
TSI Fenway, LLC
TSI Fort Lee, LLC
TSI Franklin Park, LLC
TSI Freehold, LLC
TSI Germantown, LLC
TSI Glendale, LLC
TSI Highpoint, LLC
TSI Hoboken, LLC
TSI Hoboken North, LLC
TSI Holdings (IP), LLC
TSI Holdings (NJ), LLC
TSI Jersey City, LLC
TSI Livingston, LLC
TSI Mahwah, LLC
TSI Market Street, LLC
TSI Marlboro, LLC
TSI Matawan, LLC
TSI Montclair, LLC
TSI Nashua, LLC
TSI Newark, LLC
TSI No Sweat, LLC
TSI North Bethesda, LLC

         
By:
  /s/ Richard G. Pyle    
 
       
 
  Name: Richard G. Pyle    
 
  Title: CFO    

 

--------------------------------------------------------------------------------

 

TSI Norwalk, LLC
TSI Woodmere, Inc.
TSI Old Bridge, LLC
TSI Parsippany, LLC
TSI Plainsboro, LLC
TSI Princeton, LLC
TSI Princeton North, LLC
TSI Radnor, LLC
TSI Ramsey, LLC
TSI Ridgewood, LLC
TSI Rittenhouse, LLC
TSI Rodin Place, LLC
TSI Silver Spring, LLC
TSI Society Hill, LLC
TSI Somerset, LLC
TSI South Bethesda, LLC
TSI Springfield, LLC
TSI Sterling, LLC
TSI Waltham, LLC
TSI Water Street, LLC
TSI Wellington Circle, LLC
TSI West Caldwell, LLC
TSI West Springfield, LLC
TSI Westwood, LLC

         
By:
  /s/ Richard G. Pyle    
 
       
 
  Name: Richard G. Pyle    
 
  Title: CFO    

 

--------------------------------------------------------------------------------

 

SCHEDULE I
COMMITMENTS

              Revolving Loan   Lender   Commitment  
Deutsche Bank Trust Company Americas
  $ 22,500,000.00  
BNP Paribas
  $ 12,500,000.00  
CIT Lending Services Corporation
  $ 12,500,000.00  
Merrill Lynch Capital, a division of Merrill Lynch Business Financial Services
Inc.
  $ 12,500,000.00  
Credit Suisse
  $ 10,000,000.00  
Goldman Sachs Credit Partners L.P.
  $ 3,500,000.00  
Royal Bank of Canada
  $ 1,500,000.00  
 
     
TOTAL:
  $ 75,000,000.00