BowFlex Inc. Files for Voluntary Chapter 11 Protection and Reaches Stalking Horse Agreement to Facilitate Sale

BowFlex Inc. (NYSE: BFX) (“BowFlex” or “the Company”) today announced that it has entered into a purchase agreement with Johnson Health Tech Retail, Inc. (the “Stalking Horse Bidder”) to serve as the stalking horse bidder to acquire substantially all of the assets of the Company for $37,500,000 in cash at the closing of the transaction, less closing adjustment amounts for accounts receivable, inventory and certain transfer taxes. In order to facilitate the sale process, the Company and certain of its subsidiaries have voluntarily initiated a Chapter 11 proceeding (the “Chapter 11 Cases”) in the United States Bankruptcy Court for the District of New Jersey (“Bankruptcy Court”), which will provide interested parties the opportunity to submit competing offers.

Additionally, subject to court approval, the Company has secured a $25 million facility for debtor-in-possession financing, comprised of a $9 million revolving commitment and $16 million term loan reflecting the roll-up of the Company’s pre-petition term loans of approximately $16 million (the “DIP Facility”) from Crystal Financial LLC d/b/a SLR Credit Solutions (“SLR”) and its affiliates, subject to court approval, to enable the Company to continue operating in a normal course and meet its financial obligations to employees, vendors and its continued provision of customer orders during Chapter 11 proceedings and while executing the sale process. The DIP Facility is being provided by SLR pursuant to an amendment (the “Amendment”) to the Company’s existing Term Loan Credit Agreement with SLR dated November 30, 2022 (as amended, the “Credit Agreement”).

“For decades, BowFlex has empowered healthier living and enabled consumers to reach their fitness goals with our innovative home fitness products and individualized connected fitness experiences. As a result of the post-pandemic environment and persistent macroeconomic headwinds, we conducted a comprehensive strategic review and determined this was the best path forward for our Company,” said Jim Barr, BowFlex Inc. Chief Executive Officer. “We are fortified by the potential partnership with Johnson Health Tech and encouraged by the multiple parties that have indicated an interest in bidding for our Company. Our goal is to maximize value for our stakeholders through this process.”