BowFlex gets approval of bid procedures over U.S. trustee objection

By Sarah Lizee

Olympia, Wash., March 8 – BowFlex Inc.’s proposed bid procedures for its assets were approved by the U.S. Bankruptcy Court for the District of New Jersey, according to an order filed Friday.

As a reminder, the company has entered into a purchase agreement with Johnson Health Tech Retail, Inc. to serve as the stalking horse bidder to acquire substantially all the assets of the company for $37.5 million in cash, less closing adjustment amounts for accounts receivable, inventory and transfer taxes.

The company received approval to provide bid protections to the stalking horse bidder, including a 3.5% breakup fee and a $600,000 expense reimbursement.

Under the bid procedures, the bid deadline is noon ET on April 5, an auction will be held on April 8, and a sale hearing will take place on April 15.

As previously reported, the motion had drawn an objection from Regions 3 and 9 U.S. trustee Andrew R. Vara.

Vara took issue with the proposed timetable under the bid procedures, saying it does not give the yet-to-be-formed official committee of unsecured creditors enough time to evaluate the motion.

The U.S. trustee also said the breakup fee and expense reimbursement for Johnson Health are excessive when measured against the $37.5 million purchase price.

BowFlex is a home exercise equipment company based in Vancouver, Wash. The company filed bankruptcy on March 4 under Chapter 11 case number 24-12364.

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