8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 6, 2007

Town Sports International Holdings, Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware
(State or other Jurisdiction
of Incorporation) 333-114210
(Commission File Number) 20-0640002
(I.R.S. Employer
Identification No.)

888 Seventh Avenue, New York, New York
(Address of Principal Executive Offices) 10106
(Zip Code)

Registrant’s telephone number, including area code: (212) 246-6700

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement.

     On March 6, 2007, Town Sports International Holdings, Inc., a Delaware corporation (the “Company”), amended the Town Sports International Holdings, Inc. 2006 Stock Incentive Plan, as amended (the “Plan”). The Plan was amended to provide that if a full-time employee of the Company or an affiliate who is participant in the Plan commences working on a part-time basis in the future, then such participant will be deemed to have a “termination of employment” for purposes of the Plan.

     This description of the amendment to the Plan is qualified in its entirety by reference to the complete text of Amendment No. 2 to the Plan, which is filed as Exhibit 10.1 to this report and incorporated herein by reference.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

     On March 6, 2007, the Board of Directors of the Company unanimously appointed Thomas Galligan III, as a director of the Company. In connection with Mr. Galligan’s appointment, the Board of Directors increased the size of the Board to seven members. Mr. Galligan will receive an annual retainer of $20,000, and will be granted an option to purchase 5,000 shares of the Company’s common stock in accordance with the terms of the Town Sports International Holdings, Inc. 2006 Stock Incentive Plan, as amended.

     On March 6, 2007, the Company’s Board of Directors, upon the recommendation of the Compensation Committee, changed the compensation for non-employee directors of the Company for the calendar year 2007. The approved compensation for the Company’s Non-Employee Directors is summarized in Exhibit 10.2 attached hereto, the contents of which are incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

     (d) Exhibits.

10.1 Amendment No. 2 to the Town Sports International Holdings, Inc. 2006 Stock Incentive Plan.

10.2 Non-Employee Director Compensation Summary.

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	TOWN SPORTS INTERNATIONAL HOLDINGS, INC. (Registrant)
Date: March 8, 2007	By:	/s/ RICHARD PYLE
		Richard Pyle
		Chief Financial Officer

EXHIBIT INDEX

10.1	Amendment No. 2 to the Town Sports International Holdings, Inc. 2006 Stock Incentive Plan.
10.2	Non-Employee Director Compensation Summary.

EX-10.1

Exhibit 10.1

AMENDMENT NO. 2
TO THE
TOWN SPORTS INTERNATIONAL HOLDINGS, INC.
2006 STOCK INCENTIVE PLAN

     WHEREAS, Town Sports International Holdings, Inc. (the “Corporation”) maintains the Town Sports International Holdings, Inc. 2006 Stock Incentive Plan, as previously amended (the “Plan”);

     WHEREAS, pursuant to Section 13.1 of the Plan, the Compensation Committee of the Board of Directors of the Corporation (the “Compensation Committee”) may at any time, and from time to time, amend, in whole or in part, any of or all the provisions of the Plan; and

     WHEREAS, the Compensation Committee desires to amend the Plan, effective as of January 1, 2007;

     NOW, THEREFORE, pursuant to Section 13.1 of the Plan, the Plan hereby is amended, effective as of March 15, 2007, as follows:

     1.       Section 2.47 of the Plan is amended by the addition of the following new sentence at the end thereof:

“Further, notwithstanding the foregoing, with respect to Awards granted on or after March 15, 2007, a Participant that is a full-time employee of the Company or an Affiliate that commences working on a part-time basis for the Company or an Affiliate shall be deemed to have experienced an involuntary Termination of Employment without Cause if such Participant is not regularly scheduled to work more than 24 hours per week.”

     2.       Section 11.1(a)(v) of the Plan is amended by the addition of the following new sentences at the end thereof:

“Notwithstanding the foregoing, if a Participant is deemed to have experienced a Termination of Employment in accordance with the last sentence of Section 2.47 of the Plan, then (A) any Stock Options and any Stock Appreciation Rights that are not vested as of the date of such Participant’s Termination of Employment in accordance with the last sentence of Section 2.47 of the Plan (“Special Unvested Options or Rights”) shall not terminate or expire as of the date of such Termination of Employment and shall remain outstanding until a Participant experiences a Termination of Employment (other than on account of the last sentence of Section 2.47 of the Plan), but in no event beyond the expiration of the stated term of any such Special Unvested Options or Rights, and (B) no Special Unvested Options or Rights will thereafter vest except as set forth in the next succeeding sentence. If, after a Termination of Employment in

accordance with the last sentence of Section 2.47 of the Plan, (1) a Participant remains continuously employed by the Company or any of its Affiliates, and (2) subsequent thereto, such Participant becomes regularly scheduled to work more than 24 hours per week, then any Special Unvested Options or Rights shall immediately vest as to any shares of Common Stock that did not vest under the terms of such Special Unvested Options or Rights between the date of such Participant’s Termination of Employment in accordance with the last sentence of Section 2.47 of the Plan and the date such Participant became regularly scheduled to work more than 24 hours per week solely as a result of the application of the immediately preceding sentence.”

     3.       Except as specifically amended hereby, the Plan is hereby ratified and confirmed in all respects and remains in full force and effect.

     IN WITNESS WHEREOF, the Corporation has caused this Amendment No. 2 to be executed as of March 6, 2007.

TOWN SPORTS INTERNATIONAL HOLDINGS, INC.
By:	/s/ Richard Pyle
	Name:	Richard Pyle
	Title:	CFO

EX-10.2

Exhibit 10.2

Non-Employee Director Compensation Summary

1.      Each non-employee Board member (who is not affiliated with Bruckmann, Rosser, Sherrill & Co., Inc. (“BRS”)) will receive a $20,000 annual retainer, payable quarterly in arrears. For each year, commencing in 2008, any such Board member may elect (by giving written notice to the Company on or before the first business day of the applicable calendar year) to receive such annual retainer in the form of shares of Common Stock of the Company, payable quarterly in arrears under the Town Sports International Holdings, Inc. 2006 Stock Incentive Plan, as amended (the “Plan”) (with the value of such shares of Common Stock being the Fair Market Value (as defined in the Plan) thereof on the last business day of each calendar quarter). This annual retainer will be pro rated for any partial year.

2.      The chairman of the Audit Committee will receive an additional $10,000 annual retainer, payable quarterly in arrears. For each year, commencing in 2008, the chairman of the audit committee may elect (by giving written notice to the Company on or before the first business day of the applicable calendar year) to receive such annual retainer in the form of shares of Company Stock of the Company, payable quarterly in arrears under the Plan (with the value of such shares of Common Stock being the Fair Market Value thereof on the last business day of each calendar quarter). This additional annual retainer will be pro rated for any partial year.

3.      Each existing non-employee Board member (who is not affiliated with BRS) will receive an annual stock option grant of 1,000 shares on the first business day of each calendar year with the exercise price being the Fair Market Value thereof on the date of the grant; provided, however, that in the case of 2007, this grant will be made by the Compensation Committee as soon as practicable after March 6, 2007 with the exercise price being the Fair Market Value thereof on the date of the grant. Each annual grant will vest on the first anniversary of the grant.

4.      Each new non-employee director joining the Board will receive an initial stock option grant of 5,000 shares with the exercise price being the Fair Market Value thereof on the date of the grant. The grant will vest in three equal installments on the first, second and third anniversaries of the grant, respectively. Each new non-employee director will be eligible in the following year to receive the annual stock option grant referred to in Section 3 above.

5.      Each non-employee Board member (who is not affiliated with BRS) will receive an additional $3,000 for each Board meeting that such director attends in person and an additional $1,000 for each Board meeting that such director attends via telephone.

6.      Each non-employee member of a committee (who is not affiliated with BRS) other than the audit committee will receive an additional $1,000 for each committee meeting that such director attends in person and an additional $500 for each Board committee meeting that such director attends via telephone.

7.      Each non-employee member of the audit committee (who is not affiliated with BRS) will receive an additional $2,500 for each audit committee meeting that such director attends in person and an additional $1,000 for each audit committee meeting that such director attends via telephone.

8.      Each non-employee Board member and each member of a committee will be reimbursed for any out-of-pocket expenses reasonably incurred by him or her in connection with services provided in such capacity.

9.      At such time as BRS ceases to receive the annual fee under the Professional Services Agreement between Holdings and BRS, each non-employee Board member who is affiliated with BRS and each member of a committee who is affiliated with BRS will be eligible to receive the amounts referred to in Sections 1, 3, 5, 6 and 7 above payable to non-BRS affiliated Board members and committee members, as applicable.