Borrowings

12 Months Ended

Dec. 31, 2018

BORROWINGS

Term Loan and Line of Credit

On December 31, 2015 we entered into an amendment (the “Amendment”) to our existing Credit Agreement, dated December 5, 2014, with JPMorgan Chase Bank, N.A. (“Chase Bank”) that provided for an $80 million term loan to finance the acquisition of Octane Fitness (the “Term Loan”), which matures on December 31, 2020. The Term Loan and our existing $20 million revolving line of credit with Chase Bank are secured by substantially all of the assets of Nautilus. The Credit Agreement was amended again on December 21, 2018, which, among other changes, extended the term of the $20.0 million revolving line of credit to December 31, 2021.

The Credit Agreement, as amended, contains customary covenants, including minimum fixed charge coverage ratio and funded debt to EBITDA ratio, and limitations on capital expenditures, mergers and acquisitions, indebtedness, liens, dispositions, dividends and investments. The Credit Agreement also contains customary events of default. Upon an event of default, the lender may terminate its credit line commitment, accelerate all outstanding obligations and exercise its remedies under the continuing security agreement.

Borrowing availability under the Credit Agreement is subject to our compliance with certain financial and operating covenants at the time borrowings are requested. Letters of credit under the Credit Agreement are treated as a reduction of the available borrowing amount and are subject to covenant testing.

The interest rate applicable to the Term Loan and to each advance under the revolving line of credit is based on either Chase Bank's floating prime rate or adjusted LIBOR, plus an applicable margin. As of December 31, 2018, our borrowing rate for the Term Loan and line of credit advances was 3.34%.

As of December 31, 2018, we had outstanding borrowings of $32.0 million on our term loan and no letters of credit issued under the Credit Agreement. As of December 31, 2018, we were in compliance with the financial covenants of the Credit Agreement, and $20.0 million was available for borrowing under the line of credit.

Future principal maturities of our Term Loan are as follows (in thousands):



2019	$	16,000
2020	16,000
	$	32,000