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Nautilus Vote Too Close to Call

VANCOUVER, WA -- Although Sherborne Investors is claiming victory at yesterday’s meeting of Nautilus shareholders, Robert Falcone, CEO of the equipment manufacturer, told one media outlet that it was too close to call.

A Nautilus spokesperson said today that it’s too early to know the results.

“Preliminary results aren't due for another two weeks. Speculating at this point would not be appropriate,” says Ron Arp, spokesperson for Nautilus, Vancouver, WA.

However, based on preliminary figures it says was provided by proxy solicitation firm DF King & Co., Sherborne Investors released a statement that its four nominees to the board were approved by the shareholders. Those four nominees are Edward J. Bramson, managing director of Sherborne, executive chairman of Spirent Communications plc and formerly chairman of Ampex Corp. and Elementis plc; Gerard L. Eastman, managing director of Sherborne Investors and formerly managing director of Citigroup Global Markets Inc.; Michael Stein, formerly CFO of ICOS Corp., Nordstrom and Marriott International; and Richard Horn, formerly general manager of the Pets Hotel Division of PetSmart.

If that is true, then Falcone, Ronald Badie and Marvin Siegert are the three board members that remain from the original board.

Sherborne Investors, which owns 23.5 percent of Nautilus’ stock, began to seek removal of board members this fall after the company announced a continuing decline in its stock price that began two years ago. In the third quarter, the company announced a loss of $13.45 million.

Prior to the Dec. 18 shareholder meeting, four proxy advisory firms had advised shareholders not to approve Sherborne’s full proposal. Two of those firms had suggested replacing just two of the board members.

Falcone became CEO in August and has already put in place several efforts that he says will turn around the company. The former Nike executive laid off 9 percent of Nautilus’ workforce, cut expenses by $10 million annually and put the company’s clothing line, Pearl Izumi, up for sale.

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