Edwin Watts Golf sets bid procedures for store closing and asset sales

By Caroline Salls

Pittsburgh, Nov. 5 - Edwin Watts Golf Shops, LLC requested court approval of the bid procedures for its proposed combined sale in the form of store closing sales and the sale of some of its assets, according to a Nov. 5 filing with the U.S. Bankruptcy Court for the District of Delaware.

The company's bankruptcy petition said it reached a nonbinding agreement in principle on Oct. 31 under which Hilco Merchant Resources, LLC would conduct a liquidation or sale of some of Edwin Watts Golf's assets and GWNE, Inc. would acquire some assets not liquidated by Hilco and assume specified liabilities.

Chief financial officer Lynda K. Barr said in a statement filed with the court that GWNE will purchase and continue to operate a significant number of the company's locations under the Edwin Watts Golf name. Hilco will act as the agent to liquidate inventory at the remaining stores.

Barr said the agreement provides for a $45 million guaranteed amount to be paid to the company, subject to adjustment based on the inventory.

According to the bid procedures motion, the proposed term sheet includes a financing contingency. If the contingency is not met or waived by 4 p.m. ET on Nov. 15, the Hilco and GWNE joint venture will forfeit $500,000 of its $1 million deposit, and Edwin Watts Golf will have the option to either continue with the proposed joint venture agreement or proceed to auction without a stalking horse bid.

Qualified competing bids must at least equal the proposed purchase price, plus a $1.6 million minimum overbid amount. The overbid amount includes a $1.35 million breakup fee and $250,000 in expense reimbursement to be paid to the stalking horse bidder if it is not the high bidder at auction.

Bids are due by 4 p.m. ET on Dec. 2. If one or more qualifying bids are received, the auction will be held on Dec. 4.

Bids at auction must be made in minimum increments of $250,000.

The bid procedures hearing is scheduled for Nov. 20.

Edwin Watts Golf, a Fort Walton Beach, Fla.-based specialty golf retailer, filed for bankruptcy on Nov. 4. Its Chapter 11 case number is 13-12876.

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