Nautilus confirms new board slate, gets new $150 million loan
Nautilus (NYSE: NLS) and Sherborne Investors LP jointly announced that the voting results from a special shareholder meeting confirmed that all four Sherborne Investors nominees have been elected to the Nautilus board of directors. The final voting results, which were certified by IVS Associates, also showed that all of Sherborne's other proposals were passed.
Effective immediately, Edward Bramson, Gerard Eastman, Michael Stein and Richard Horn will join incumbent directors Robert Falcone, Ronald Badie and Marvin Siegert on the board.
Bramson was elected as chairman at a board meeting. Falcone, who previously served as chairman, will continue to serve as president and CEO. Sherborne had proposed that the company separate the positions of chairman and CEO.
Sherborne, which represents a 25 percent Nautilus stake, had said it is dissatisfied with the financial performance of the struggling company and management's turnaround plan.
The new directors were elected at a special meeting of shareholders on Dec. 18.
Nautilus also said it has agreed with Bank of America N.A to replace its current debt facility with a five-year, $100 million loan. The asset-backed loan can be extended to $125 million if Nautilus requires. The deal is expected to close Jan. 14, 2008.
In other news: The Portland (Oregon) Business Journal reported that Nautilus has sold its 94,000-square-foot building in Louisville, Colo., a suburb north of Denver, for $6.3 million. The Colorado property was sold to a private investment group on Christmas Eve.
Nautilus purchased the building as part of the 2001 acquisition of Schwinn Fitness. The article noted that the company had considered moving the staff of its Pearl Izumi fitness apparel business into the building, but has since decided to try to sell the apparel division.
Court rules Finish Line must go ahead with Genesco deal
A judge ruled that Genesco executives did not commit fraud during negotiations over a $1.5 billion acquisition and Finish Line (Nasdaq: FINL) must complete the purchase.
Nashville Chancellor Ellen Hobbs Lyle dismissed Finish Line's claims that Genesco withheld key financial information that could have signaled worse-than-expected earnings after the deal closed in June.
Lyle said Finish Line and investment bank UBS AG were sophisticated enough to know what they were getting into with the $54.50-per-share purchase.
The buyout was conducted by "teams of lawyers, advisers and handlers being paid enormous sums to orchestrate the procedure for obtaining information" she wrote.
UBS has filed a separate federal lawsuit in New York asking that its commitment to finance most of the deal be declared void because the combined entity would go bankrupt and default on its debt payments. That case is still pending.
UBS issued a statement saying it disagrees with the court and believes "there are material issues in our client's and UBS' favor in this matter."
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