Bally Sends Open Letter to Shareholders Citing Operational Turnaround, Strategic Alternatives Process; Continues Call for Shareholders to Support Eric Langshur, Bally's Proxy Nominee.CHICAGO Chicago, city, United States Chicago (shĭkä`gō, shĭkô`gō), city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837. -- Bally Total Fitness Bally Total Fitness is an American health club chain with 400 gyms in 70 cities, and claims 4 million customers [1]. The chain has recently opened gyms in South Korea, China & the Bahamas. (NYSE NYSE See: New York Stock Exchange :BFT (Binary File Transfer) An extension to the fax protocol that allows transmission of raw data. A page of text is transmitted faster than a bitmap of the page and is displayed at normal printer resolution at the receiving side. ), the nation's leader in health and fitness, released the following open letter to shareholders today.
DEAR SHAREHOLDER:
As we approach Bally Total Fitness' January 26 shareholders
meeting, the Company once again asks you to vote your proxy in support
of Bally's Board of Directors and management team, which continues to
make significant progress in turning around and transforming the
Company's business to create value for shareholders.
Bally's more flexible business model and new marketing campaign
are helping the Company to attract members and drive revenue growth.
The combination of top-line growth and a continued focus on reducing
costs and improving efficiencies across the board also is beginning to
favorably impact Bally's bottom line performance. As you may recall,
Bally reported a 70% increase in operating income before impairment
charges for the first nine months of 2005 to $61.7 million, and a net
profit of $1.8 million for the same period.
But don't just take our word alone that Bally is on the right
track.
Pardus Capital Management, our largest shareholder, acknowledged
the Company's improving financial performance in their December 8,
2005 SEC filing noting"...the Company (Bally) reported financial and
operating results that were even better than 'street' expectations."
In a December 1, 2005 analyst report issued by Jefferies &
Company, Inc.,(a) Bally was also cited for progress on multiple
fronts, "Under Paul Toback's leadership, "Bally has significantly
strengthened its executive management team, improved the integrity of
its accounting, is aggressively upgrading its internal systems, and
centralizing backend processes.
Moreover, the company has simplified and improved the flexibility
of its membership plan to appeal to a wider range of customers in
order to compete more effectively in its existing markets."
As we've noted for months, we need to address the company's
over-leveraged capital structure. To that end, Bally's Board has
created an independent, special committee that is in the process of
leading a value-creating strategic alternatives process that may well
result in a recapitalization, the sale of securities or assets of the
Company, or the sale or merger of Bally with another entity or
strategic partner. Consistent with Bally's commitment to running a
fair and open process, we will provide you with updates as the process
progresses in the coming weeks and months.
In terms of our Board's commitment to effective corporate
governance practices, Institutional Shareholder Services (ISS), the
world's leading provider of proxy voting and corporate governance
services, recently issued a proxy analysis assigning a high rating to
Bally in its Corporate Governance Quotient, noting that "(Bally) BFT
outperformed 83.1% of the companies in the Consumer Services group."
Bally again asks for your support for the election of Eric
Langshur, the head of Bally's Audit Committee and the individual who
successfully led our financial team through the arduous process of
successfully restating our financials. We strongly recommend that you
vote your proxy FOR Eric Langshur. Since the time remaining before the
annual meeting is short, please vote by telephone or Internet today.
We strongly urge you not to sign any green proxy card that may be
sent to you by Pardus Capital Management or a gold proxy card that may
be sent to you by Liberation Investments.
We appreciate your continued support, and if you need assistance
or have any questions, please call MacKenzie Partners toll-free at
800-322-2885 or collect at 212-929-5500.
On behalf of the Board of Directors,
PAUL A. TOBACK
Chairman and CEO
Bally Total Fitness Holding Corporation
---------------
(a) Jefferies & Company, Inc. report dated December 1, 2005, by Donald
Trott, CFA and Timothy Allen. Consent has not been sought or obtained
for the use, as proxy-soliciting material, of previously published
material reproduced in this document.
About Bally Total Fitness Bally Total Fitness is the largest and only nationwide commercial operator of fitness centers in the U.S., with nearly 440 facilities located in 29 states, Mexico, Canada, Korea, China and the Caribbean under the Bally Total Fitness(R), Crunch (1) To process data. See number crunching. (2) To compress data. See data compression. 1. (jargon) crunch - To process, usually in a time-consuming or complicated way. Fitness(SM), Gorilla gorilla, an ape, Gorilla gorilla, native to the lowland and mountain forests of western and central equatorial Africa. It is the largest of the apes, the males reaching a height of 5 to 6 ft (150–190 cm) with a 9-ft (144–cm) arm spread. Sports(SM), Pinnacle pinnacle (pĭn`ĭkəl), minor architectural motif of vertical tapering shape, usually crowning a pier, buttress, or gable. Although sometimes it appears in Renaissance design, as in the Certosa di Pavia, it is almost exclusively a medieval Fitness(R), Bally bally Adjective, adv Brit old-fashioned, slang extreme or extremely: a bally nuisance, he's too bally charming for his own good Adj. 1. Sports Clubs A sports club, athletics club or sports association is an eclectic institution oriented to multiple sports, which fields many teams and has varied sports departments in several sports, working under the same umbrella organization. (R) and Sports Clubs of Canada (R) brands. Bally offers a unique platform for distribution of a wide range of products and services targeted to active, fitness-conscious adult consumers. Forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. in this release including, without limitation, statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's plans, strategies, objectives, expectations, intentions, and adequacy of resources, are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. |
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