VANCOUVER, Wash. - BowFlex Inc. (NYSE: BFX), a well-known home fitness company, has initiated Chapter 11 bankruptcy proceedings and is securing $25 million in debtor-in-possession financing to maintain its operations. The financing from SLR Credit Solutions will support the company's commitments to employees, vendors, and customers as it navigates through the restructuring process.
In conjunction with the bankruptcy filing, BowFlex has also reached an agreement with Johnson Health Tech Retail, Inc. to act as the "stalking horse" in a planned asset sale for $37.5 million in cash, subject to certain adjustments and court approval. The stalking horse bid sets the floor for any other offers that may come in during the bankruptcy sale process.
Jim Barr, CEO of BowFlex, cited the post-pandemic environment and economic challenges as the impetus for the strategic review that led to the decision to file for Chapter 11. Barr expressed optimism about the potential partnership with Johnson Health Tech and the interest from other parties in the sale process.
The proposed transaction is structured under Section 363 of the U.S. Bankruptcy Code, which allows for competitive bidding. Interested parties will have the opportunity to submit higher or otherwise better offers than the initial stalking horse bid. BowFlex has outlined bid protections for Johnson Health Tech, including expense reimbursement, a breakup fee, and a deposit forfeiture under certain conditions.
Legal and financial advisors have been appointed to assist BowFlex in managing the sale and auction process, with Sidley Austin LLP, Holland & Hart LLP, FTI Consulting (NYSE:FCN), Inc., and FTI Capital Advisors LLC serving in these roles.
The company's future operations and the sale process are subject to court approval and other legal requirements. Additional details regarding the Chapter 11 cases and asset sale can be accessed through the company's claims agent, Epiq.
This news is based on a press release statement from BowFlex Inc. and does not include any speculative or forward-looking statements.
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