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Bally Obtains Waiver and Forbearance Agreements

CHICAGO – Bally Total Fitness announced today that it has secured limited waiver and forbearance agreements from the requisite holders of its 10 1/2 percent Senior Notes due 2011 and its 9 7/8 percent Senior Subordinated Notes due 2007.

The waivers relate to Bally’s inability to file its Annual Report on Form 10-K for fiscal 2006 and Quarterly Report on Form 10-Q for the first quarter of 2007 with the Securities and Exchange Commission on a timely basis and Bally’s non-payment of interest on its Senior Subordinated Notes, each of which are defaults under the indentures governing the notes.

Under terms of the agreements, noteholders will waive the defaults and forbear from exercising any related remedies until July 13 on terms similar to the recently executed forbearance agreement under Bally’s senior secured credit facility. That agreement required that forbearance arrangements be in place with holders of a majority of the Senior Notes and at least 75 percent of the Senior Subordinated Notes by yesterday. Holders of more than 80 percent of the Senior Notes and the Senior Subordinated Notes signed forbearance agreements with Bally.

Last week, Bally announced that it would pay a one-time cash consent fee of $1.25 per $1,000 principal amount of notes to its holders.

“We greatly appreciate the support of our noteholders, which has enabled the company to secure forbearance agreements from all three of our key creditor groups,” Don Kornstein, Bally’s Chief Restructuring Officer and interim Chairman, said in a statement. “With these collective arrangements now in place, we can continue to focus on completing the company’s 2006 financial statements and negotiating a consensual restructuring to de-lever the company’s balance sheet and establish a strong and stable financial foundation for Bally Total Fitness.”

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