Bally Total Fitness amends revolver to push out its 10-Q filing deadline

By Sara Rosenberg

New York, Aug. 10 - Bally Total Fitness Holding Corp. got a waiver from revolver lenders extending the second quarter form 10-Q filing deadline to Sept. 30 while accounting issues are being examined, according to a company news release.

As was previously announced, KPMG LLP succeeded Ernst & Young LLP as Bally's independent auditor on May 18 and is conducting its initial quarterly review of the financial statements. Bally's is also being investigated by the Securities and Exchange Commission regarding these accounting issues.

Currently, the company anticipates restating prior periods to record a liability that has accumulated to approximately $5 million as of June 30 related to repayment obligations due in 2015 or later on membership contracts sold by a subsidiary before Bally acquired it in the late 1980s. The effect on prior income statements is the addition of non-cash annual interest charges of between $231,000 and $472,000 in each of the years 1996 through 2003, the release said.

As of July 31, the Chicago-based fitness center operator had $42.3 million available under its $100 million revolver, compared to $65 million of availability at June 30.

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