exv4w1



 








Exhibit 4.1




SUPPLEMENTAL INDENTURE




     SUPPLEMENTAL INDENTURE, dated as of April 7, 2006, among Bally Total Fitness Holding
Corporation, a Delaware corporation (the “Company”) and U.S. Bank National Association, as trustee
(the “Trustee”).



     WHEREAS, the Company has duly issued its 10-1/2% Senior Notes due 2011 in the aggregate
principal amount of $235,000,000 (the “Notes”) pursuant to an Indenture dated as of July 2, 2003,
among the Company, the Guarantors named therein and the Trustee (as amended or supplemented, the
“Indenture”), and the Notes are outstanding on the date hereof;



     WHEREAS, the Company solicited, and received, consents (the “Initial Consent Solicitation”)
upon the terms and subject to the conditions set forth in the Company’s Consent Solicitation
Statement dated November 15, 2004 and the accompanying Letter of Consent, from Holders representing
at least a majority in aggregate principal amount of the outstanding Notes to certain waivers of
Defaults and amendments to the Indenture described therein;



     WHEREAS, pursuant to the Initial Consent Solicitation and Sections 5.13 and 10.20 of the
Indenture, Holders representing at least a majority in aggregate principal amount of the
outstanding Notes waived certain Defaults under and prospective compliance with Sections 7.4, 10.17
and 10.19(b) of the Indenture through the Waiver Expiration Date;



     WHEREAS, Section 9.2 of the Indenture provides that, with the consent of the Holders of at
least a majority in aggregate principal amount of the outstanding Notes, the Company and the
Trustee may enter into an indenture supplemental to the Indenture for the purpose of amending,
modifying or changing the Indenture or the Notes;



     WHEREAS, to waive compliance with Section 7.4 of the Indenture through the Waiver Expiration
Date, the Company and the Trustee entered into an indenture supplemental to the Indenture on
December 7, 2004 in accordance with Section 9.2 of the Indenture;






     WHEREAS, the Company has also solicited, and has received, consents (the “Second Consent
Solicitation”) upon the terms and subject to the conditions set forth in the Second Consent
Solicitation Materials (as defined below), from Holders representing at least a majority in
aggregate principal amount of the outstanding Notes to obtain an extension of certain waivers of
Defaults received in the Initial Consent Solicitation and amendments to the Indenture described
therein;



     WHEREAS, pursuant to the Second Consent Solicitation and Sections 5.13 and 10.20 of the
Indenture, Holders representing at least a majority in aggregate principal amount of the
outstanding Notes agreed to an extension of the waivers received in the Initial Consent
Solicitation with respect to certain Defaults under and prospective compliance with Sections 7.4,
10.17 and 10.19(b) of the Indenture through the New Waiver Expiration Date;



     WHEREAS, to extend the waiver of compliance with Section 7.4 of the Indenture through the New
Waiver Expiration Date, the Company and the Trustee entered into an indenture supplemental to the
Indenture in accordance with Section 9.2 of the Indenture;




 









 






     WHEREAS, the Company has also solicited, and has received, consents (the “Third Consent
Solicitation”) upon the terms and subject to the conditions set forth in the Third Consent
Solicitation Materials (as defined below), from Holders representing at least a majority in
aggregate principal amount of the outstanding Notes to obtain certain waivers of Defaults and
amendments to the Indenture described therein;



     WHEREAS, pursuant to the Third Consent Solicitation and Sections 5.13 and 10.20 of the
Indenture, Holders representing at least a majority in aggregate principal amount of the
outstanding Notes have agreed to waive certain Defaults under and prospective compliance with
Sections 7.4, 10.17 and 10.19(b) of the Indenture through the applicable Third Consent Solicitation
Waiver Expiration Date (as defined below);



     WHEREAS, to extend the waiver of compliance with Section 7.4 of the Indenture through the
applicable Third Consent Solicitation Waiver Expiration Date, the Indenture requires the Company
and the Trustee to enter into an indenture supplemental to the Indenture in accordance with Section
9.2 of the Indenture; and



     WHEREAS, Section 9.4 of the Indenture provides that a supplemental indenture becomes effective
in accordance with its terms and thereafter binds every Holder;



     NOW, THEREFORE, the parties hereto agree as follows:



     SECTION 1. ACKNOWLEDGEMENTS. (a) The Trustee acknowledges that the Holders representing at
least a majority in aggregate principal amount of the outstanding Notes have waived through the
applicable Third Consent Solicitation Waiver Expiration Date the Company’s obligation to file with
the SEC and furnish to Holders of Notes and the Trustee the Prior Information as required by
Sections 7.4, 10.17 and 10.19(b) of the Indenture in accordance with and subject to the terms and
conditions set forth in the Third Consent Solicitation Materials.



     (b) Subject to the terms and conditions set forth in the Third Consent Solicitation
Materials, the Trustee acknowledges that pursuant to Section 5.13 of the Indenture by reason of
such waiver referenced in paragraph (a) above, any past Default or any Event of Default arising
therefrom and their respective consequences shall cease to exist through the applicable Third
Consent Solicitation Waiver Expiration Date.



     SECTION 2. DEFINITIONS. Capitalized terms not defined herein shall have the meanings given
to such terms in the Indenture or any supplemental indenture related thereto.



     SECTION 3. AMENDMENT TO SECTION 1.1. The following defined terms are hereby inserted into
Section 1.1 of the Indenture in their respective correct alphabetical order. To the extent the
defined terms are already included in the Indenture, such terms are replaced in their entirety by
the defined terms set forth below.



     “Additional Consent Fee” means: (i) with respect to the Initial Consent Solicitation, a
payment in cash to Consenting Holders equal to $2.50 per $1,000 in principal amount of Notes with
respect to which consents were received and not revoked in accordance with the terms of the
Company’s Consent Solicitation Statement dated November 15, 2004 and the related Letter of Consent;
and (ii) with respect to the Third Consent Solicitation, at the election of the



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Consenting Holders, either: (x) $3.33 in cash; or (y) 1.4815 shares of the Company’s Common
Stock, par value $0.01 per share, in each case per $1,000 in principal amount of Notes with respect
to which consents were received and not revoked in accordance with the terms and conditions set
forth in the Third Consent Solicitation Materials.




     “Consenting Holders” means: (i) with respect to the Initial Consent Solicitation, the Persons
in whose names Notes were registered in the Note Register on November 18, 2004 from whom properly
executed, unrevoked Letters of Consent were received on or prior to December 7, 2004 in accordance
with the terms of the Company’s Consent Solicitation Statement dated November 15, 2004 and the
related Letter of Consent; and (ii) with respect to the Third Consent Solicitation, the Persons in
whose names the Notes were registered in the Notes Register on March 20, 2006 from whom properly
executed, unrevoked Letters of Consent were received on or prior to April 7, 2006 in accordance
with the Third Consent Solicitation Materials.



     “Prior Information” means annual reports, quarterly reports and other documents which the
Company was required to file with the SEC pursuant to Sections 13(a) or 15(d) of the Exchange Act
and furnish to Holders of Notes and the Trustee and which have not been so filed or furnished as of
the date hereof.



     “Second Consent Solicitation Materials” means the Company’s Consent Solicitation Statement
dated July 13, 2005 and the related Letter of Consent, as amended and supplemented through
September 2, 2005.



     “Third Consent Solicitation Materials” means the Company’s Consent Solicitation Statement
dated March 27, 2006 and the related Letter of Consent, as amended and supplemented through the
date hereof.



     “Third Consent Solicitation Waiver Expiration Date” shall mean, as applicable: (i) 5:00 p.m.,
New York City time, on July 10, 2006, with respect to the Company’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2005 and the Company’s Quarterly Report on Form 10-Q for the
quarter ended March 31, 2006; and (ii) 5:00 p.m., New York City time, on September 11, 2006, with
respect to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2006;
provided, however, such expiration relating to the Company’s Quarterly Report on Form 10-Q for the
quarter ended June 30, 2006 may be extended to 5:00 pm., New York City time, on October 11, 2006 in
the event the Company pays the Additional Consent Fee on the terms and conditions set forth in the
Third Consent Solicitation Materials.



     SECTION 4. AMENDMENT TO SECTION 7.4. Section 7.4 of the Indenture is hereby amended by
inserting the following at the end of the last paragraph:



     “Notwithstanding any of the foregoing and subject to the terms and conditions set forth in the
Third Consent Solicitation Materials, the Company shall not be required to comply with this Section
7.4 during the period beginning on the date hereof and ending on the applicable Third Consent
Solicitation Waiver Expiration Date.”



     SECTION 5. MISCELLANEOUS.



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     Section 5.1. New York Law to Govern. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF).



     Section 5.2. Counterparts. This Supplemental Indenture may be executed in any number
of counterparts, each of which shall be an original; but such counterparts shall together
constitute but one and the same instrument.



     Section 5.3. Effect of Headings. The Section headings herein are for convenience
only and shall not affect the construction hereof.



     Section 5.4. Trustee Disclaimer. The Trustee has accepted the amendment of the
Indenture effected by this Supplemental Indenture and agrees to execute the trust created by the
Indenture as hereby amended, but only upon the terms and conditions set forth in the Indenture,
including the terms and provisions defining and limiting the liabilities and responsibilities of
the Trustee, and, without limiting the generality of the foregoing, the Trustee shall not be
responsible in any manner whatsoever for or with respect to any of the recitals or statements
contained herein, all of which recitals or statements are made solely by the Company, or for or
with respect to (a) the validity or sufficiency of this Supplemental Indenture or any of the terms
or provisions hereof, (b) the proper authorization hereof by the Company by corporate action or
otherwise, (c) the due execution hereof by the Company, (d) the consequences (direct or indirect
and whether deliberate or inadvertent) of any amendment herein provided for, and the Trustee makes
no representation with respect to any such matters and (e) the validity or sufficiency of the
solicitation or the consent solicitation materials or procedure in connection therewith.



[Signatures on following page]




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     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly
executed and attested, all as of the date first written above.



	 	 	 	 	 
	 	BALLY TOTAL FITNESS HOLDING CORPORATION

 	 
	 	By:  	/s/ Marc D. Bassewitz
 	 
	 	 	Name:  	Marc D. Bassewitz 	 
	 	 	Title:  	Senior Vice President and General Counsel 	 
	 



	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee

 	 
	 	By:  	/s/ Richard Prokosch
 	 
	 	 	Name:  	Richard Prokosch 	 
	 	 	Title:  	Vice President 	 
	 



	 	 	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 




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