1. Proposal for Acquisition of The Sports Club/LA Nicole Braun, Roxy Perleberg, Matt Theiss, Nicki Van Enkevort

2. Overview of LTF Company Founded in 1992 by Braham Akradi Ending 2007, LTF operated 71 fitness centers in 17 states, Today LTF operates 85 fitness centers in 19 states Services Offered: Full Gym, Work-out center, Pool/Indoor Water Park, Rock Climbing Wall, Childcare, Spa, Café, Experience Life Magazine, Free Locker-rooms, and more.

3. Overview of LTF Company Con’t Ending 2007 LTF employs 15,000 people Currently, LTF holds 21% market share compared with its competitors –Competitors include: Bally Fitness, Equinox, Town Sports & YMCA –Focus on Mid-Upper Middle Class Stock regularly out performs the market –Current price $19.04 –EPS 1.81 –Beta 1.76

4. LTF Strategic Objectives Mission –“We provide an Education, Entertainment, Friendly and Inviting, Functional and Innovative experience of uncompromising quality that meets the health and fitness needs of the entire family” Vision –“To be a Premier Employer by making every team member more valuable each year while Building and Expanding a Macro Healthy Way of Life Company and Brand that is respected and coveted by Customers, Vendors and Competitors”

5. Competitive Strategy –Large, high quality, physical structures –A wide variety of offerings which attract a large and strong demographic –Strong member experience focused on high-quality, high- volume business with value pricing LTF Strategic Objectives

6. LTF Financial Status Very strong financial status. Annual revenue growth of 25%, 31%, and 28% over the past three years, respectively. In 2007, LTF had EBITDA of $197.7 million. Annual EBITDA growth of 25%, 24%, 33% over the past three years, respectively. In 2007, LTF had a profit margin of 10.4%.

7. Life Time Fitness Income Statements 2007 2006 2005 Revenues $655.8 $511.9 $390.1 Expenses (518.4) (411.4) (309.2) Other Exp. (24.2) (16.4) (13.0) EBIT 113.2 84.1 67.9 Taxes (45.2) (33.5) (26.7) Net Income $ 68.0 $ 50.6 $ 41.2 **Numbers in millions

8. Life Time Fitness Balance Sheets 2007 2006 Assets $1,386.5 $987.7 Liabilities $ 814.0 $595.2 Equity 572.5 392.5 $1,386.5 $987.7 **Numbers in millions

9. Overview of The Sports Club/LA Founded in 1979 by Michael Talla Awarded Best Yoga and Best Health Club in America 5 facilities –Los Angeles, Orange County, Rockefeller Center, Beverly Hills, Dallas 2,619 employees

10. Overview of The Sports Club/La Services include state-of-the-art cardiovascular and weight training options, full service spa, expert private training, fit lab assessment centers, valet parking, swimming, basketball, volleyball, and many more. Millennium Partners purchased six facilities in 2006 –Reebok Sports Club, Upper East Side, Washington, D.C., San Francisco, Boston, Miami –$ 80 million

11. The Sports Club/LA Strategic Objectives Marketing strategy –Providing high quality, lavish, and cutting edge fitness and personal health services Mission –We are the finest sports and fitness club company in the world dedicated to enhancing our members mission

12. The Sports Club/LA Strategic Objectives Culture –Their lavish, large, high quality buildings attract many of the wealthy residents who live in large metropolitan areas. –High quality physical structures, a variety of services, and high quality targeted to the most elite, even to the stars.

13. The Sports Club/LA Financial Status Very weak financial position. Losses for the past seven years. Extremely high operating expenses exceed revenues. In 2007, EBITDA was $7 million. Profit margin was -9.9% in 2007.

14. The Sports Club/LA Income Statements 2007 2006 2005 Revenues $61.7 $58.8 $56.2 Expenses (62.0) (59.9) (75.1) Other Exp. (5.8) (5.3) (3.3) EBIT (6.1) (6.4) (22.2) Taxes 0 1.8 0 Net Loss $ (6.1) $ (4.6) $(22.2) **Numbers in millions

15. The Sports Club/LA Balance Sheets 2007 2006 Assets $ 82.8 $ 89.5 Liabilities $102.1 $104.1 Contingencies 10.5 9.6 Equity (29.8) (24.2) $ 82.8 $ 89.5 **Numbers in millions

16. The Sports Club Opportunity LTF Current Cost of Expansion $31 Mil. * 5 = $153 Mil. Estimated Cost of The Sports Club/LA $66 Mil. - $92 Mil. New York City, Los Angeles, Orange County, Beverly Hills, Dallas Total Estimated Savings $61Mil. - $87 Mil.

17. The Sports Club Opportunity Con’t Buyout of a competitor – Increase market share from 21% to 23% instantly, & 30% in 5 years Entrance into the upper class market Increase advertising opportunities due to celebrity memberships Gain space in highly populated areas Fully-staffed & licensed facilities Top of the line equipment Low stock price

18. Management Opportunities Turning losses into gains –Sports Club 2007 losses = $6.1 Million Buy-out of Board of Directors & Executive Management –Estimated remuneration value = $4 - $5 Million –Preferred stock dividends = $1.2 Million –Total savings = $5.2 – $6.3 Million Utilizing Key Performers –On-site development & LTU

19. Management Opportunities Con’t Number of LTF employees per facility = 211 Number of Sports Club employees per facility for the same volume business = 400 –Reduction in force of 125 employees per facility, additional 75 anticipated to leave –Adjustment of existing pay scales –$1,000 bonus for employees willing to stay on staff for one month following announcement –Fitness auditions & Internal Transfer opportunities –Consolidation of Marketing, Finance, & Administrative functions –Intensive training of Sports Club staff & customer transition 25 – 40% Savings in Payroll Expenses

20. Marketing Opportunities A 24% annual increase in sales over the next five years. –Celebrities –34% availability at the 32 recently new centers. –LTF Management strategy

21. Market Share Currently have 21% Adding 9% –2% from Sport Club –5% up from a 24% increase due to regular LTF business operations –2% expected increase in existing Sports Club facilities due to improved management strategy because of LTF

22. Marketing Opportunities LTF Onyx membership $120 Diamond membership $150 Onyx Plus membership $250

23. Financial Opportunities Low common stock price of $1.05. Ability to reduce operating expenses by using LTF’s current model. $87.9 million in federal operating loss tax carryforwards. $56.5 million in state operating loss tax carryforwards.

24. Purchase Price Our Offer: $65,704,679 –2x value of preferred stock –2 year payout of future preferred dividends –1.5x value of common stock Maximum Purchase Price: $91,832,906 –3x value of preferred stock –2 year payout of future preferred dividends –2x value of common stock

25. Financing the Purchase Sale of Life Time Fitness common stock –4.0-5.5 million shares Stock trade for current Sports Club common stockholders –Defer any undesired tax consequences

26. Goodwill Goodwill expected to increase by $86.5 million. –$68 million due to purchase price plus direct costs –$18.5 million due to amount that liabilities assumed exceed assets acquired.

27. Consolidated Income Statements 2009 2010 2011 2012 2013 Revenues $1,088.6 $1,349.9 $1,673.9 $2,075.6 $2,573.8 Expenses (846.3) (1,049.4) (1301.2) (1,613.5) (2000.8) Other Exp. (44.7) (55.4) (68.8) (85.3) (105.7) EBIT 197.6 245.1 303.9 376.8 467.3 Taxes (78.4) (97.4) (120.9) (150.1) (186.3) Net Loss $ 119.2 $ 147.7 $ 183.0 $ 226.7 $ 281.0 **Numbers in millions

28. Consolidated Balance Sheets 2009 2010 2011 2012 2013 Assets $2,080.8 $2,344.3 $2,685.4 $3,125.9 $3,695.9 Liabilities $1246.7 $1,362.5 $1,520.6 $1,734.4 $2,023.3 Equity 834.1 981.8 1,164.8 1,391.5 1,672.6 $2080.8 $2,344.3 $2,685.4 $3,125.9 $3,695.9 **Numbers in millions

29. Debt-to-Equity Ratio Current Debt-to-Equity Ratio: 1.01 Immediately after acquisition: 1.32 –Large amount of debt assumed in acquisition. Five years after acquisition: 1.04

30. Return on Investment Best-case scenario: 4 years Worst-case scenario: 5 years Discounted payback periods calculated using expected results from operations. Additional synergy savings: –Construction cost savings –Opportunity cost savings

31. Employee announcement Pay scales, layoffs, & Training Timeline Bonuses for staying on staff $1,000 to stay on till Feb. 27 th ; estimated cost $625,000 Assessment of key employees Negotiations with MP 100% Ownership of all facilities Contingent on discussions w/MP Dec 1 st Jan. 15 th – Jan. 30 th Jan. 1 st – Jan. 30 th Jan. 15 th Feb. 2 nd – Feb. 13 th Feb. 2 nd Feb. 2 nd – Feb. 27 th Feb. 28 th Feb. 27 th March 6 Months Dec. 1 st - Jan. 15 th Integration Timeline Estimated time from letter of intent to full integration: 4 months Expected payback period: 4-5 years

32. Acquisition Summary Accelerate LTF’s strategic growth strategy by adding 5 upscale facilities –Which would be profitable in less then 5 months –Gain instant increased market share –Provide new advertising opportunities –Provide new talent to enhance existing LTF training And do this at a cost roughly 40% to 57% less than LTF’s normal expansion costs

33. Questions???