Subsequent Events

12 Months Ended

Mar. 31, 2024

SUBSEQUENT EVENTS

Bankruptcy

On April 15, 2024, the Bankruptcy Court authorized the sale of the Acquired Asset pursuant to the terms of the Stalking Horse Asset Purchase Agreement and on April 22, 2024, the Asset Sale closed. Proceeds from the Asset Sales were approximately $37.5 million. As previously reported, there were insufficient proceeds from the Asset Sale for common stockholders to receive value for their shares.

On April 22, 2024, proceeds from the Asset Sale were used to repay the Company’s obligations under the existing Term Loan Credit Agreement, dated as of November 30, 2022, as amended, by and among the Company and Nautilus Fitness Canada, Inc., a British Columbia company and subsidiary of the Company, as borrowers, and Crystal Financial LLC d/b/a SLR Credit Solutions, as administrative agent and a lender. Immediately upon such repayment, the Term Loan Credit Agreement was terminated.

Below is a schedule of assets sold to Johnson Health Tech Retail Inc, as of March 31, 2024, and as of the closing date of the Asset Purchase Agreement on April 22, 2024 (in thousands), net of closing adjustments:


	Carrying value as of:
Assets Sold	March 31, 2024		April 22, 2024
Accounts Receivable
U.S. Accounts Receivable	$	7,705	$	7,961
Canada Accounts Receivable	911		1,004
Total Accounts Receivable	8,616		8,965

Inventory
U.S. Inventory	29,529		27,897
Canada Inventory	688		641
Total Inventory	30,217		28,538

Total Intellectual Property	2,900		2,900

Total Sold Assets	$	41,733	$	40,403

Termination of Leases

Leases for all BowFlex US locations were rejected as part of the Bankruptcy Cases on May 31, 2024. We negotiated exit and termination arrangements for our leases in China in May 2024, and subsequently entered into a new leasing arrangement for our China location because the Chinese government requires a physical address until the entity is fully dissolved. Nautilus Switzerland AG filed bankruptcy through the courts of Switzerland on April 26, 2024, causing the lease for the Swiss location to become a liability of the entity to be extinguished through its bankruptcy process.