AMENDMENT NO. 1 TO
STOCKHOLDERS AGREEMENT and CONSENT AGREEMENT dated as of
March 23, 2006 (this “ Amendment ”), among
Town Sports International Holdings, Inc., a Delaware corporation
(the “ Company ”), Town Sports International,
Inc., a New York corporation (“ TSI ”), and
those of the Stockholders (as defined in the Stockholders Agreement
referred to below) that are signatory hereto (the Company, TSI and
such Stockholders are herein referred to collectively as the
“ Parties ”).
A. The
Parties and certain other Stockholders have entered into that
certain Stockholders Agreement dated as of February 4, 2004
(“ Stockholders Agreement ”).
B. The
Parties desire to amend the Stockholders Agreement in accordance
with Section 10 of the Stockholders Agreement.
NOW, THEREFORE, on
the basis of the preceding facts, and in consideration of the
mutual agreements and covenants set forth below and other good and
valuable consideration, the receipt and sufficiency of which hereby
are acknowledged, the Parties agree as follows:
1.
Definitions . Unless the context otherwise requires, all
capitalized and other defined terms not defined in this Amendment
shall have the respective meanings accorded to them in the
Stockholders Agreement.
(a) The
Stockholders Agreement hereby is amended to provided that, for all
purposes of the Stockholders Agreement, Mark Smith shall cease to
be deemed an “Executive”, as such term is defined in
the Stockholders Agreement, but shall continue to be deemed a
“Stockholder” as such term is defined in, and for all
purposes of, the Stockholders Agreement.
(b) Section 6
of the Stockholders Agreement hereby is amended to add the
following new sentence at the end thereof:
“For the
avoidance of doubt, this Section 6 shall not apply with
respect to an Initial Public Offering.”
(c) Section 14
of the Stockholders Agreement hereby is amended to add the
following new paragraph at the end thereof:
“(k)
Initial Public Offering . Notwithstanding anything in this
Agreement to the contrary, this Agreement will terminate
automatically and be of no further force and effect upon the
consummation of an Initial Public Offering.”
(a) As
Mark Smith has resigned or is resigning from the Board, pursuant to
Section 2(a)(ii)(B) of the Stockholders Agreement, those
Parties owning a majority of the Executive Shares (voting as a
single class) hereby consent to the election of Robert Giardina to
the Board.
(b) Pursuant
to clause (iv) of Section 11 of the Stockholders
Agreement, those Parties holding at least 70% of the Stockholder
Shares (excluding Mark Smith) hereby consent to the transactions
relating to Mark Smith referred to in Schedule A
attached hereto.
4.
Governing Law . This Amendment shall be governed by,
construed and enforced in accordance with, the laws of the State of
New York.
5.
Counterparts . This Amendment may be executed (including by
facsimile transmission) with counterpart signature pages or in any
number of counterparts, each of which when executed shall be deemed
to be an original, but all of which taken together shall constitute
one and the same agreement.
6. Bound
Parties . The Stockholders Agreement is being amended by this
Amendment pursuant to Section 10 of the Stockholders Agreement
and the amendments to the Stockholders Agreement shall be effective
upon the execution and de
