|
|
|
|
|
|
|
|
|
Item 1.01
|
|
Entry into a Material Definitive Agreement
|
On October 14, 2020, Nautilus, Inc. (the “Company”) entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) with True Fitness Technology, Inc., a Missouri corporation (“True Fitness”). Pursuant to the terms of the Stock Purchase Agreement, on October 14, 2020, True Fitness purchased from the Company 100% of the issued and outstanding capital stock of OF Holdings, Inc., a Delaware corporation (“Holdings”), which included Holding’s wholly-owned subsidiary Octane Fitness, LLC, a Minnesota limited liability company (collectively, “Octane Fitness”). In addition, effective October 14, 2020, pursuant to terms of a U.K. Asset Transfer Agreement, a subsidiary of True Fitness, True Fitness Technology U.K. Limited, purchased certain assets and assumed certain Octane Fitness brand-related liabilities of the Company’s U.K. subsidiary, Octane Fitness UK Ltd. Contemporaneously with the transactions described above, True Fitness Technology Ireland Limited, a subsidiary of True Fitness, entered into an NL Asset Transfer Agreement with Octane Fitness International B.V., a company organized under the laws of the Netherlands, providing for the True Fitness subsidiary to purchase certain assets and assume certain Octane brand-related liabilities of Octane Fitness International B.V. That transaction is anticipated to close on or before November 30, 2020. The above-described transactions are collectively referred to as the “Sale of the Octane Business”.
The aggregate consideration for the Sale of the Octane Business as provided by the Stock Purchase Agreement and the asset transfer agreements consists of a base purchase price of $25,000,000, subject to adjustments for cash and cash equivalents, indebtedness, transaction expenses and working capital. Those agreements contain customary representations, warranties and covenants by each party that are subject, in some cases, to specified exceptions and qualifications contained in those agreements and the confidential disclosure schedules related thereto.
The foregoing summary does not purport to be complete and is qualified in its entirety by reference to the Stock Purchase Agreement and the asset transfer agreements attached thereto, a copy of which is filed as Exhibit 2.1 to this report and incorporated herein by reference.