scc Doc 42 Filed 12/21/16 Entered 12/21/16 14:37:35 Main Document Pg 1 of 4

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1 scc Doc 42 Filed 12/21/16 Entered 12/21/16 14:37:35 Main Document Pg 1 of 4 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x In re : Chapter 11 : CHOXI.COM, INC., a/k/a NOMORERACK.COM, INC. : Debtor. : x : Case No (SCC) ORDER PURSUANT TO SECTIONS 105(a) AND 363 OF THE BANKRUPTCY CODE AND BANKRUPTCY RULES 2002 AND 6004 (i) APPROVING BID PROCEDURES, (ii) SCHEDULING AN AUCTION AND FINAL HEARING AND (iii) APPROVING THE FORM AND MANNER OF NOTICE THEREOF Upon the Motion (the Motion ) 1 of the Debtor pursuant to Sections 105(a), 332 and 363 of title 11 of the United States Code (the Bankruptcy Code ) and Rules 2002 and 6004 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules ) (A) for an order (i) approving the License Agreement (the License Agreement ) between the Debtor, on the one hand, and N.D. Gems Inc. and 9th LLC (together, the Stalking Horse Bidder ), on the other hand, annexed to the Motion as Exhibit A, on an interim basis, subject to higher and better offers as may emerge at an Auction; (ii) scheduling the Bid Procedures Hearing; and (iii) directing the appointment of a consumer privacy ombudsman under Section 332 of the Bankruptcy Code; (B) for an order (this Bid Procedures Order ) (i) approving the Bid Protections for the Stalking Horse Bidder; (ii) approving the proposed bid procedures annexed to the Motion as Exhibit B (the Bid Procedures ); (iii) scheduling an auction and hearing for approval of the License Agreement on a final basis or the sale or license of the Licensed Property to the successful bidder at Auction (the Purchaser ); and (iv) approving the form and manner of notice thereof in the form annexed to the Motion as Exhibit C (the Auction and Sale Notice ); and (C) for an order approving the License Agreement on a final basis or authorizing the license or sale of the Licensed Property to the Purchaser, free and 1 Capitalized terms used but not otherwise defined herein shall be ascribed the meanings provided in the Motion. 1

2 scc Doc 42 Filed 12/21/16 Entered 12/21/16 14:37:35 Main Document Pg 2 of 4 clear of all liens, claims and encumbrances; and upon the record of the Bid Procedures Hearing held before this Court on December 19, 2016 and all proceedings heretofore held in this case; and the Court having jurisdiction to consider the Motion and the relief requested therein; and due and proper notice of the Motion having been provided and no further notice being required; and a reasonable opportunity to object or be heard regarding the relief requested in the Motion and granted herein having been given; and objections, if any, to the relief requested in the Motion and granted herein having been resolved or overruled; and the relief requested in the Motion being in the best interests of the Debtor s estate and its creditors; and the Court having determined that the legal and factual bases set forth in the Motion establish just cause for the relief granted herein; and after due deliberation and sufficient cause appearing therefor; NOW, THEREFORE, IT IS HEREBY ORDERED THAT: 1. The relief requested in the Motion is granted solely to the extent provided herein. 2. The Bid Procedures, as revised as reflected on Exhibit A hereto, are hereby authorized and approved in all respects and incorporated herein by reference. All proceedings related to, among other things, the submission, consideration, qualification and acceptance of bids from Qualified Bidders, the conduct of the Auction, and the identification and determination of the Successful Bidder and, if any, Back-up Bidder, shall be governed by and conducted in accordance with the Bid Procedures. 3. Any individual or entity wishing to submit a bid for the license or purchase of the Licensed Property must do so in accordance with the terms of the Bid Procedures by the Bid Deadline of January 9, 2017 by 12:00 p.m. (Prevailing Eastern Time). The failure in this Bid Procedures Order to include specific reference to any particular provision, section or article of the Bid Procedures shall not diminish or impair the effectiveness of the Bid Procedures, it being the intent of this Court that the Bid Procedures be authorized and approved in their 2

3 scc Doc 42 Filed 12/21/16 Entered 12/21/16 14:37:35 Main Document Pg 3 of 4 entirety and incorporated herein by reference. 4. The Auction and Sale Notice, as revised as reflected on Exhibit B hereto, is hereby authorized and approved in all respects and incorporated herein by reference. 5. Any objections to entry of this Bid Procedures Order have been withdrawn, waived, resolved or settled, and all reservations of rights included therein are overruled in their entirety. 6. The Auction, if required, shall commence at 10:00 a.m. (Prevailing Eastern Time) on January 12, 2017 at the law offices of Klestadt Winters Jureller Southard & Stevens, LLP, 200 West 41st Street, 17th Floor, New York, New York The Debtor may conduct the Auction in accordance with the Bid Procedures. 7. Objections, if any, to the approval of the license or sale of the Licensed Property on a final basis must: (i) be in writing; (ii) state with particularity the reasons for the objection or response, (iii) conform to the Bankruptcy Rules and the Local Bankruptcy Rules for the Southern District of New York, (iv) set forth the name of the objecting party and the nature and basis of the objection, and (v) be filed with the Clerk of the Court (with a copy to be delivered to the Chambers of the Honorable Shelley C. Chapman, United States Bankruptcy Court for the Southern District of New York, One Bowling Green, New York, New York 10004), and simultaneously served on: (a) proposed counsel to the Debtor, Klestadt Winters Jureller Southard & Stevens, LLP, 200 West 41 st Street, 17 th Floor, New York, New York 10036, Attn: Tracy L. Klestadt, Esq., tklestadt@klestadt.com; (b) proposed counsel to the Official Committee of Unsecured Creditors, Nutovic & Associates, 261 Madison Avenue, 26 th Floor, New York, New York 10016, Attn: Isaac Nutovic, Esq., inutovic@nutovic.com, (c) counsel to the Stalking Horse Bidder, Rubin LLC, 345 Seventh Avenue, 21 st Floor, New York, New York 10001, Attn: Paul A. Rubin, Esq., prubin@rubinlawllc.com; (d) counsel to certain of the Prepetition Secured Lenders, 3

4 scc Doc 42 Filed 12/21/16 Entered 12/21/16 14:37:35 Main Document Pg 4 of 4 Halperin Battaglia Benzija, LLP, 40 Wall Street, 37 th Floor, New York, New York 10005, Attn: Debra Cohen, Esq., dcohen@halperinlaw.net; and (e) the Office of the U.S. Trustee, U.S. Federal Office Building, 201 Varick Street, Suite 10006, New York, New York 10014, Attn: Gregory Zipes, Esq., so as to be actually received no later than 4:00 p.m. (EST) on January 17, The Court shall conduct the Final Hearing for approval of the license of the Licensed Property to the Stalking Horse Bidder on a final basis, or approval of the license or sale of the Licensed Property to the Successful Bidder at the Auction, on January 19, 2017 at 1:30 p.m. (Prevailing Eastern Time). 9. The Stalking Horse Bidder may seek a finding of good faith pursuant to section 363(m) of the Bankruptcy Code in connection with entry of the Final Order. 10. The Debtor shall cause this Bid Procedures Order, including all exhibits hereto, to be served by first class mail upon the Notice Parties. 11. Notwithstanding the possible applicability of Bankruptcy Rules 6004(h), 7062, 9014 or otherwise, the terms and conditions of this Order shall be effective immediately and enforceable upon its entry, and no automatic stay of execution shall apply to this Order. 12. This Court shall retain exclusive jurisdiction with respect to any matters, claims, rights or disputes arising from or related to the implementation of this Bid Procedures Order. Dated: New York, New York December 21, 2016 /S/ Shelley C. Chapman HONORABLE SHELLEY C. CHAPMAN UNITED STATES BANKRUPTCY JUDGE 4

5 scc Doc 42-1 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit A Pg 1 of 8 EXHIBIT A BID PROCEDURES 1 The following Bid Procedures shall govern the process for the auction and license or sale of that certain Licensed Property of Choxi.com, Inc. (the Debtor ), debtor and debtorin-possession in a case pending under chapter 11 of title 11 of the United States Code (the Bankruptcy Code ) entitled, Choxi.com, Inc., a/k/a Nomorerack.com, Inc., Case No (SCC) (the Chapter 11 Case ), pending before the United States Bankruptcy Court, Southern District of New York (the Bankruptcy Court ), free and clear of all liens, claims and encumbrances pursuant to Section 363 of the Bankruptcy Code, and pursuant to the Bankruptcy Court s Order approving these Bid Procedures and authorizing the Auction (as defined herein) of the Licensed Property and granting related relief, and any other orders issued by the Bankruptcy Court regarding the license or sale of the Licensed Property. On December 9, 2016, the Bankruptcy Court entered an Interim Order [Docket No. 24] approving the License Agreement with the Stalking Horse Bidder, as revised as reflected on Exhibit A to the Interim Order (the License Agreement ), on an interim basis, subject to higher and better offers as may be received in accordance with these Bid Procedures. 1. Obtaining Due Diligence Access: In connection with the provision of due diligence information, the Debtor will not furnish any confidential information relating to the Debtor, the Licensed Property, or the proposed sale thereof except to a potential bidder who has executed a non-disclosure agreement in form and substance reasonably acceptable to the Debtor. 2. Determination of Qualified Bidder Status. Any potential bidder who wishes to participate in the Auction and to bid to license or acquire the Licensed Property must be a Qualified Bidder. A Qualified Bidder is a potential bidder who, on or before January 9, 2017 at 12:00 noon (Prevailing Eastern Time) (the Bid Deadline ), delivers a complete Bid Package (as defined below) to the following parties so that it is actually received by such parties before the Bid Deadline: (a) proposed counsel to the Debtor, Klestadt Winters Jureller Southard & Stevens, LLP, 200 West 41st Street, 17th Floor, New York, NY 10036, Attn: Tracy L. Klestadt, Esq., tklestadt@klestadt.com; (b) the Stalking Horse Bidder, N.D. Gems Inc./9 th LLC, 1200 Avenue of the Americas, 5 th Floor, New York, New York 10036, harry.savalia@lucentusa.com; (c) counsel to the Stalking Horse Bidder, Rubin LLC, 345 Seventh Avenue, 21 st Floor, New York, New York 10001, Attn: Paul A. Rubin, Esq., prubin@rubinlawllc.com; (d) proposed counsel to the Official Committee of Unsecured Creditors, Nutovic & Associates, 261 Madison Avenue, 26 th Floor, New York, New York 10016, Attn: Isaac Nutovic, Esq., inutovic@nutovic.com; and 1 Unless otherwise indicated, terms capitalized but not defined herein shall have the meanings ascribed to them in the Motion. 1

6 scc Doc 42-1 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit A Pg 2 of 8 (e) counsel to certain of the Prepetition Secured Lenders, Halperin Battaglia Benzija, LLP, 40 Wall Street, 37 th Floor, New York, New York 10005, Attn: Debra Cohen, Esq., dcohen@halperinlaw.net and Alan Halperin, Esq., ahalperin@halperinlaw.net. No conditions relating to the completion of due diligence will be permitted to exist after the Bid Deadline. 3. Bid Package. A Bid Package shall consist of a written and signed irrevocable and binding offer that: (a) fully discloses the identity of the person or entity that will be bidding for the Licensed Property (the Potential Bidder ) or otherwise participating in connection with such bid on behalf of the Potential Bidder, the terms of any such participation (including, if the Potential Bidder is an entity formed for the purpose of consummating the proposed transaction contemplated by the bid, the equity holder or other financial backer), the Potential Bidder s address, telephone number and address where the bidder may be contacted, and sufficient evidence that the Potential Bidder is legally empowered by power of attorney or otherwise to complete the transaction on the terms contemplated by its bid; (b) is accompanied by financial information which fairly and reasonably demonstrates the Potential Bidder s ability (and the sources of the Potential Bidder s ability) to close on its license or purchase of the Licensed Property if the Potential Bidder should be the Successful Bidder (as hereinafter defined), in an amount at least as much as its bid; (c) is accompanied by evidence that a good faith deposit in the amount of at least Two Hundred Sixty Thousand ($260,000) Dollars (the Deposit ), in immediately available funds, has been made (or is concurrently being made) by wire transfer to Klestadt Winters Jureller Southard & Stevens, LLP, as escrow agent (the Escrow Agent ), pursuant to wire instructions to be provided by the Debtor, and acknowledges that the Deposit shall be held by the Escrow Agent in a non-interest bearing, segregated, account of the primary account the Debtor maintains for the Debtor s estate in accordance with the terms hereof; (d) attaches an executed agreement to license the Licensed Property in substantially the same form as the agreement entered into between the Debtor and the Stalking Horse Bidder, marked to show proposed changes thereto, or an executed purchase agreement for the purchase of the Licensed Property, provided that the potential changes may not be materially more burdensome to the Debtor or inconsistent with these Bid Procedures; (e) includes the elements of a Minimum Bid (as hereinafter defined in Section 5(e)); and (f) includes an executed original of these Bid Procedures acknowledging and agreeing to these Bid Procedures, and includes confirmation of 2

7 scc Doc 42-1 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit A Pg 3 of 8 the following: (i) (x) the Potential Bidder is not a partner, officer, director, stockholder, or employee of the Debtor, the Debtor s principals, Klestadt Winters Jureller Southard & Stevens, LLP, or any relative of any of the foregoing; (y) the Potential Bidder relied solely on its own independent investigation, analysis, appraisal and evaluation of the Licensed Property and it did not rely upon and did not receive any written or oral statements, representations, warranties, promises or guarantees whatsoever, whether express or implied or by operation of law or otherwise, with respect to the Licensed Property and (z) the Potential Bidder agrees to be bound by the confidentiality agreement to be executed by and between the Debtor and the Potential Bidder; (ii) the Potential Bidder is financially able and interested in acquiring the Property for aggregate consideration at least as great as that set forth in the License Agreement and on terms, as a whole, at least as favorable to the Debtor as those set forth in the License Agreement, and states that the offer is without any contingencies as to financing, shareholder, board of directors or other approval or regulatory contingencies of any kind; (iii) the Potential Bidder s bid is irrevocable until 48 hours after the Closing Date (as defined herein) or until its bid is affirmatively rejected in a written communication from Debtor to the Potential Bidder; (iv) the Potential Bidder s offer shall not be binding upon the Debtor prior to the time that the Auction is conducted and the license or sale of the Licensed Property approved by the Bankruptcy Court on a final basis; (v) if the Potential Bidder is the Successful Bidder, it shall, within two (2) business days after the Auction, increase the Deposit as necessary to an amount equal to ten (10%) percent of its final bid at the Auction, with TIME BEING OF THE ESSENCE AS TO THE SUCCESSFUL BIDDER S OBLIGATION TO INCREASE THE DEPOSIT; (vi) if the Potential Bidder is the Successful Bidder, it shall close on the license or purchase of the Licensed Property within seven (7) days after entry by the Bankruptcy Court of an order approving the license or sale of the Licensed Property (the Final Order ), or on such other date as the Debtor and the Successful Bidder shall otherwise agree to in writing, or as may otherwise be directed by Bankruptcy Court order (such date, the Closing Date ), with TIME BEING OF THE ESSENCE AS TO THE SUCCESSFUL BIDDER S OBLIGATION TO CLOSE ON THE CLOSING DATE AND TO PAY THE BALANCE OF THE PRICE TO BE PAID FOR THE LICENSED PROPERTY AT THE CLOSING; 3

8 scc Doc 42-1 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit A Pg 4 of 8 (vii) if the Potential Bidder is determined by the Debtor to have submitted the second highest or best bid at the Auction (the Back-up Bid ) and, therefore, to be designated the back-up bidder (the Back-up Bidder ), and is notified in writing that the Debtor has determined to proceed with the Back-up Bid after default by the Successful Bidder, the Potential Bidder shall close on the license or purchase of the Licensed Property on the Back-up Closing Date (as hereinafter defined), with TIME BEING OF THE ESSENCE AS TO THE BACK- UP BIDDER S OBLIGATION TO CLOSE AND TO PAY THE BALANCE OF THE PRICE TO BE PAID FOR THE LICENSED PROPERTY ON THE BACK- UP CLOSING DATE; (viii) if such Potential Bidder (x) is the Successful Bidder, the Deposit shall become non-refundable and shall be forfeited by such Successful Bidder as liquidated damages in the event the Successful Bidder shall fail to close the license or purchase of the Licensed Property on the Closing Date, except as otherwise expressly permitted under the agreement entered into between the Debtor and such Successful Bidder; and (y) if the Back-up Bidder and the Debtor determine to proceed with the Back-up Bid after default by the Successful Bidder, the Deposit shall become non-refundable and shall be forfeited by such Back-up Bidder as liquidated damages if the Back-up Bidder shall fail to close the license or purchase of the Licensed Property on the Back-up Closing Date, except as otherwise expressly permitted under the agreement entered into between the Debtor and such Back-up Bidder;. (ix) the Potential Bidder has agreed to comply with the Debtor s privacy policy and/or any related order of the Bankruptcy Court to the extent that the Potential Bidder is seeking to use or acquire any personally identifiable information as that term is defined in 11 U.S.C. 101(41A); and (x) the Potential Bidder consents to the jurisdiction of the Bankruptcy Court. 4. Qualified Bidders and the Stalking Horse Bid. The Stalking Horse Bidder is deemed a Qualified Bidder and shall be deemed to have submitted the opening bid (the Stalking Horse Bid ), with the right to submit additional bids. Any bid that does not come from a Qualified Bidder will not be considered by the Debtor. 5. Auction. If the Debtor determines that there are no submissions by Qualified Bidders other than the Stalking Horse Bidder by the Bid Deadline, then the Stalking Horse Bidder shall be determined to be the Successful Bidder pursuant to its Stalking Horse Bid. In the event that the Debtor receives by the Bid Deadline one or more submissions that the Debtor determines to be from Qualified Bidders, then the Debtor shall conduct an auction with respect to the Licensed Property (the Auction ) on January 12, 2017 at 10:00 a.m. (Prevailing Eastern Time) at the offices of Klestadt Winters Jureller Southard & Stevens, LLP, 200 W. 41 st Street, 17 th Floor, New York, New York 4

9 scc Doc 42-1 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit A Pg 5 of , or such other location determined by the Debtor. The Auction shall be live and in person. The Auction shall be governed by the following procedures: (a) Only the Debtor, the Stalking Horse Bidder, Qualified Bidders, their respective counsel, agents and designated representatives and a stenographer may attend the Auction; (b) Only the Stalking Horse Bidder and Qualified Bidders shall be entitled to make any subsequent and additional bids at the Auction; (c) Each Qualified Bidder shall be required to confirm on the reco rd that it has not engaged in any collusion with respect to the bidding or the license or sale; (d) Qualified Bidders shall participate in person at the Auction; (e) The aggregate guaranteed cash consideration of the first bid after the Stalking Horse Bid shall be no less than Two Million Five Hundred Thousand ($2,500,000) Dollars, of which at least One Million ($1,000,000) Dollars (inclusive of the Deposit) shall be payable to the Debtor on or before January 1, 2018 (the Minimum Bid ). Such Minimum Bid will be considered in good faith by the Debtor but may not necessarily be considered by the Debtor to be better and/or higher than the Stalking Horse Bid. The Debtor reserves the right to impose minimum bidding increments for successive bids at the Auction; (f) The Auction shall continue until such time as it appears to the Debtor, in its reasonable discretion, that none of the Qualified Bidders is prepared to advance the Auction and there is only one offer that the Debtor determines is the highest or best offer submitted at the Auction from among the Qualified Bidders, including the Stalking Horse Bidder (the Successful Bid ). The Debtor shall give fair warning of the closing of the bidding; (g) If more than one Qualified Bidder submits a bid in excess of the Stalking Horse Bid, after selection of the Successful Bidder, then the Debtor shall determine which bid constitutes the Back-up Bid; (h) Deposits submitted by Qualified Bidders who do not become the Successful Bidder or Back-up Bidder shall be returned by the Debtor to such Qualified Bidders within three (3) business days after the Auction, except as otherwise provided herein. Notwithstanding the return of a Deposit, the underlying bid shall be irrevocable until one (1) day after the Closing Date or until the bid is affirmatively rejected in a written communication from the Debtor to the Potential Bidder; (i) Bids at the Auction must be all cash, except bids by the Stalking Horse Bidder, without financing contingencies; and (j) Bidders at the Auction must be able and willing to close on the license or purchase of the Licensed Property within seven (7) days after entry 5

10 scc Doc 42-1 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit A Pg 6 of 8 of the Final Order. (k) Absent irregularities in the conduct of the Auction, the Bankruptcy Court will not consider bids submitted after the Auction is closed. 6. Obligation to Close and Default. (a) Except to the extent that its bid provides for monthly payments to be made over time, the Successful Bidder shall close on the license or purchase of the Licensed Property and pay the amount of the Successful Bid, less its Deposit previously posted, on the Closing Date, with TIME BEING OF THE ESSENCE AS TO THE SUCCESSFUL BIDDER S OBLIGATION TO CLOSE ON THE CLOSING DATE AND TO PAY THE BALANCE OF THE PRICE TO BE PAID FOR THE LICENSED PROPERTY AT THE CLOSING. The Successful Bidder shall be obligated to close on the license or purchase of the Licensed Property with no contingency of any kind or nature that will permit the Successful Bidder not to proceed at the closing of the license or sale, other than the inability of the Debtor to deliver the Licensed Property to the extent required under the agreement between the Debtor and the Successful Bidder. In the event the Successful Bidder shall fail to timely close the license or purchase of the Licensed Property in accordance with all of the provisions of the agreement entered into between the Debtor and the Successful Bidder, the Successful Bidder shall be in default and the Successful Bidder shall forfeit its Deposit. (b) Except to the extent that its bid provides for monthly payments to be made over time, if for any reason the Successful Bidder shall fail to timely close on the license or purchase of the Licensed Property, and the Debtor, in accordance with the provisions of the agreement entered into between the Debtor and the Successful Bidder, determines to proceed with the Back-up Bid, the Back-up Bidder shall close on the license or purchase of the Licensed Property and pay the amount of the Back-up Bid, less its Deposit previously posted, on the later of the Closing Date and ten (10) business days after written notice of the Successful Bidder s default in closing (the Back-up Closing Date ), with TIME BEING OF THE ESSENCE AS TO THE BACK-UP BIDDER S OBLIGATION TO CLOSE ON THE BACK-UP CLOSING DATE AND TO PAY THE BALANCE OF THE PRICE TO BE PAID FOR THE LICENSED PROPERTY AT THE CLOSING. If the Debtor proceeds with the Back-up Bid, then the Back-up Bidder shall be obligated to close on the license or purchase of the Licensed Property and there shall be no contingency of any kind or nature that will permit the Back-up Bidder not to proceed on the Back-up Closing Date other than the inability of the Debtor to deliver the Licensed Property to the extent required under its agreement. In the event the Back-up Bidder shall be obliged, but shall fail, to timely close the license or purchase of the Licensed Property in accordance with the provisions of the agreement entered into between the Debtor and the Back-up Bidder, the Back-up Bidder shall be in default, and the Back-up Bidder shall forfeit its Deposit. 7. Deposits of Successful Bidder and Back-up Bidder. (a) The Deposit submitted by the Successful Bidder shall be held by the Escrow Agent pending the closing of the license or sale. The Successful Bidder s Deposit shall be applied to the price paid upon the closing of the license or sale, unless the Successful Bidder shall default and fail to close in accordance with the provisions of the agreement between the Debtor and the 6

11 scc Doc 42-1 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit A Pg 7 of 8 Successful Bidder and forfeit its Deposit. (b) The Deposit submitted by the Back-up Bidder shall be held by the Escrow Agent in a non-interest bearing, segregated account until the earlier of (i) the closing of the license or sale and (ii) forty-five (45) calendar days after the Auction; provided, however, if the Successful Bidder fails to close and the Debtor decide to proceed with the Back-up Bid, then the Back-up Bidder s Deposit shall continue to be held by the Escrow Agent and shall be applied to the price paid upon the closing of the license or sale on the Back-up Closing Date, unless the Back-up Bidder shall default and fail to close and forfeit its Deposit, which shall be remitted to the Debtor s estate and retained by the Debtor as liquidated damages. 8. Due Diligence. Each bidder is solely responsible for conducting its own due diligence and must complete its due diligence prior to the submission of its bid. 9. Reservation of Rights. In the interest of maximizing the results realized through the Auction, the Debtor reserves the right to: (a) modify any of the deadlines set forth in these Bid Procedures; (b) modify or waive, at or prior to the close of the Auction, the procedures and terms and conditions regarding the license or sale of the Licensed Property; and/or (c) adjourn the Auction for a period of up to ten (10) days. 10. Additional Terms, Conditions and Procedures. (a) If the Debtor is unable to deliver the Licensed Property in accordance with these Bid Procedures for any reason whatsoever, the Successful Bidder or Back-up Bidder, as applicable, shall have no recourse against the Debtor, its counsel or any auctioneer that may be retained by order of the Bankruptcy Court (except to the extent expressly set forth in the agreement executed by and between the Debtor and the Successful Bidder or Back-up Bidder, as applicable); provided, however, that a Qualified Bidder in this circumstance shall be entitled to a return of its Deposit. (b) All parties participating in the Auction are thereby deemed to consent to the jurisdiction of the Bankruptcy Court to determine any dispute concerning these Bid Procedures or the license or sale of the Licensed Property, and the Bankruptcy Court shall retain sole and exclusive jurisdiction over all matters relating to these Bid Procedures, the Licensed Property, and the license or sale contemplated hereby. (c) The license or sale of the Licensed Property is subject to final approval by the Bankruptcy Court at a hearing to be held on January 19, 2017 at 1:30 p.m. (Prevailing Eastern Time) (or as soon thereafter as practicable), before the Honorable Shelley C. Chapman, United States Bankruptcy Judge for the Southern District of New York, One Bowling Green, New York, NY (d) No bidder will be permitted to request or assert an entitlement to any break-up fee, expense reimbursement or similar type of payment. 7

12 scc Doc 42-1 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit A Pg 8 of 8 THE UNDERSIGNED BIDDER HEREBY CONSENTS TO AND AGREES TO BE BOUND BY THE FOREGOING AUCTION PROCEDURES: Print Name of Bidder: Print Name and Title of Authorized Representative of Bidder: Signature of Authorized Representative: Date: Bidder s Contact Information: Telephone: (Work) (Cell) Bidder s Legal Counsel: Address: Telephone: 8

13 scc Doc 42-2 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit B Pg 1 of 4 KLESTADT WINTERS JURELLER Final Hearing Date: SOUTHARD & STEVENS, LLP January 19, 2017 at 1:30 p.m. (EST) Tracy L. Klestadt Stephanie R. Sweeney Objection Deadline: 200 West 41st Street, 17th Floor January 17, 2017 at 4:00 p.m. (EST) New York, New York Tel. (212) Fax (212) Proposed Counsel to the Debtor and Debtor in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK x In re : Chapter 11 : CHOXI.COM, INC., a/k/a NOMORERACK.COM, INC. : Debtor. : x : Case No (SCC) NOTICE OF AUCTION AND HEARING TO CONSIDER APPROVAL OF THE LICENSE OR SALE OF SUBSTANTIALLY ALL OF THE DEBTOR S ASSETS NOTICE IS HEREBY GIVEN, as follows: On December 5, 2016, Choxi.com, Inc. a/k/a Nomorerack.com, Inc., the debtor and debtor in possession (the Debtor ) in the above-captioned chapter 11 case (the Chapter 11 Case ) filed a motion (the Motion ) 1 pursuant to sections 105(a), 332 and 363 of title 11 of the United States Code (the Bankruptcy Code ) and Rules 2002 and 6004 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules ): (A) for an order (the Interim Order ) (i) approving the License Agreement between the Debtor, on the one hand, and N.D. Gems Inc. and 9th LLC (together, the Stalking Horse Bidder ), on the other hand, annexed to the Motion as Exhibit A (the License Agreement ) on an interim basis, subject to higher and better offers as 1 Capitalized terms used but not otherwise defined herein shall be ascribed the meanings provided in the Motion.

14 scc Doc 42-2 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit B Pg 2 of 4 may emerge at an auction for the sale or license of the Licensed Property (as defined in the License Agreement); (ii) scheduling the Bid Procedures Hearing; and (iii) directing the appointment of a consumer privacy ombudsman under Section 332 of the Bankruptcy Code; (B) for an order (the Bid Procedures Order ) (i) approving the Bid Protections for the Stalking Horse Bidder; (ii) approving the proposed bid procedures annexed to the Motion as Exhibit B (the Bid Procedures ); (iii) scheduling an Auction and hearing for approval of the License Agreement on a final basis or the sale or license of the Licensed Property to the successful bidder at Auction (the Purchaser ); and (iv) approving the form and manner of notice thereof; and (C) for an order (the Final Order ) approving the License Agreement on a final basis or authorizing the license or sale of the Licensed Property to the Purchaser, free and clear of all liens, claims and encumbrances. The Bankruptcy Court entered the Interim Order [Docket No. 24] approving the License Agreement, as revised as reflected on Exhibit A to the Interim Order, on an interim basis. The Bankruptcy Court conducted a hearing on December 19, 2016 at 10:00 a.m. (Prevailing Eastern Time) to consider entry of the Bid Procedures Order and entered the Bid Procedures Order approving the Bid Procedures, as revised as reflected on Exhibit A to the Bid Procedures Order. As set forth in the Bid Procedures, approval of the license of the Licensed Property to the Stalking Horse Bidder remains subject to higher or better offers and Bankruptcy Court approval. All interested parties are invited to make competing offers for the purchase or license of the Licensed Property in accordance with the terms of the Bid Procedures and the Bid Procedures Order. The deadline to submit a competing offer in accordance with the terms of the Bid Procedures is January 9, 2017 at 12:00 p.m. (EST) (the Bid Deadline ). Pursuant to the Bid 2

15 scc Doc 42-2 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit B Pg 3 of 4 Procedures Order, if a Qualified Bid other than the Stalking Horse Bid is received by the Bid Deadline, the Debtor may conduct an Auction for the purchase or license of the Licensed Property at the offices of Klestadt Winters Jureller Southard & Stevens, LLP, 200 West 41 st Street, 17 th Floor, New York, New York 10036, beginning at 10:00_a.m. (EST) on January 12, The Bid Procedures Order further provides that a final hearing on the sale of the License Agreement (the Final Hearing ) will be held on January 19, 2017 at 1:30 p.m. (EST) before the Honorable Shelley C. Chapman, United States Bankruptcy Judge for the Southern District of New York, One Bowling Green, New York, NY At the Final Hearing, the Debtor will request that the Bankruptcy Court enter an order, among other things, approving the highest or otherwise best bid for the Licensed Property (which will be determined in accordance with the terms of the Bid Procedures). The Debtor will request that the Bankruptcy Court approve the license or sale of the Licensed Property free and clear of any and all liens, claims and encumbrances, with any such liens, claims and encumbrances to attach to the proceeds of the license or sale of the Licensed Property to the same extent and with the same priority as they existed prior to such license or sale. At the Final Hearing, the Bankruptcy Court may enter such orders as it deems appropriate under applicable law and as required by the circumstances and equities of this Chapter 11 Case. Objections, if any, to the Motion must (a) be made in writing, (b) state with particularity the reasons for the objection or response, (c) conform to the Bankruptcy Rules and the Local Bankruptcy Rules for the Southern District of New York, (d) set forth the name of the objecting party, the nature and basis of the objection, and the specific grounds therefore, and (e) be filed with the Clerk of the Court (with a copy to be delivered to the Chambers of the Honorable 3

16 scc Doc 42-2 Filed 12/21/16 Entered 12/21/16 14:37:35 Exhibit B Pg 4 of 4 Shelley C. Chapman, United States Bankruptcy Court for the Southern District of New York, One Bowling Green, New York, New York, 10004), and shall be served upon: (i) proposed counsel to the Debtor, Klestadt Winters Jureller Southard & Stevens, LLP, 200 West 41 st Street, 17 th Floor, New York, New York 10036, Attn: Tracy L. Klestadt, Esq., tklestadt@klestadt.com; (ii) proposed counsel to the Official Committee of Unsecured Creditors, Nutovic & Associates, 261 Madison Avenue, 26 th Floor, New York, New York 10016, Attn: Isaac Nutovic, Esq., inutovic@nutovic.com, (iii) counsel to the Stalking Horse Bidder, Rubin LLC, 345 Seventh Avenue, 21 st Floor, New York, New York 10001, Attn: Paul A. Rubin, Esq., prubin@rubinlawllc.com; (iv) counsel to certain of the Prepetition Secured Lenders, Halperin Battaglia Benzija, LLP, 40 Wall Street, 37 th Floor, New York, New York 10005, Attn: Debra Cohen, Esq., dcohen@halperinlaw.net and Alan Halperin, Esq., ahalperin@halperinlaw.net; and (v) the Office of the U.S. Trustee, U.S. Federal Office Building, 201 Varick Street, Suite 10006, New York, New York 10014, Attn: Gregory Zipes, Esq., so as to be actually received no later than 4:00 p.m. (EST) on January 17, Requests for information concerning the sale of the License Agreement should be directed by written request to: Tracy L. Klestadt, Esq., Klestadt Winters Jureller Southard & Stevens, LLP, 200 West 41 st Street, 17 th Floor, New York, New York 10036, or via at tklestadt@klestadt.com. 4