EZ Lube gets court OK of bid procedures for asset sale to second-lien lender affiliate

By Jennifer Lanning Drey

Portland, Ore., Jan. 14 - EZ Lube, LLC obtained court approval of the bid procedures for the sale of substantially all of its assets, according to a Wednesday filing with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, EZ Lube Acquisition Co. LLC, an affiliate of the company's second-lien lender, is the stalking horse bidder for the proposed asset sale.

EZ Lube Acquisition's bid includes the amount required to repay EZ Lube's debtor-in-possession facility, either in cash or through assumption of the DIP obligations, plus $1.5 million in cash, plus the difference of the amount provided for professional fee claims less the amount of professional fee claims paid at closing, plus a $2 million credit bid amount.

If EZ Lube Acquisition is not the high bidder at auction, the company will reimburse up to $500,000 of its sale-related expenses.

Competing bids are due by 4 p.m. ET on March 13.

All bids must include a $1 million deposit and must exceed the stalking horse bid by at least $500,000. Subsequent bids at auction must be for at least $100,000 more than the previous bid.

If multiple bids are received, an auction will be held on March 31.

The sale hearing is scheduled for April 3.

EZ Lube is a Santa Ana, Calif.-based quick lube operator. Its Chapter 11 case number is 08-13256.

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