FlexShopper - Bidding Procedures / APA Summary

Bidding Procedures / Asset Purchase Agreement Summary

Parties Involved

• Sellers: FlexShopper, Inc.; FlexShopper, LLC; and FlexLending, LLC.
• Stalking Horse Bidder: ReadySett LLC (an affiliate of Snap U.S. Holdings, LLC), together with its permitted successors, designees, and assigns.
• Consultation Parties: The Administrative Agent, the DIP Lender, and any official statutory committee appointed in the cases.
  • Any Consultation Party that submits a bid or participates in a prospective bid (including the DIP Lender/Stalking Horse Bidder) will cease to be a Consultation Party until they unequivocally revoke their bid.

Assets Being Sold

• The transaction contemplates the sale of substantially all of the Debtors' direct or indirect right, title, and interest in tangible and intangible assets related to the Business.
• Purchased Assets:
  • Equity Interests: FlexShopper, LLC's 100% equity interest in non-Debtor FlexShopper 1, LLC (which owns 100% of the equity in FlexShopper 2, LLC, the "SPV Borrower" under the Securitization Program).
  • Intellectual Property & Data: All Seller Intellectual Property, customer and subscriber data (including PII, transaction history, and analytics), and transferrable social media/online accounts.
  • Contracts & Actions: Assumed Contracts, Assumed Permits, and Purchased Actions (including specific Avoidance Actions against Ongoing Trade Parties or relating to Assumed Contracts).
  • Other Assets: Goodwill, certain insurance proceeds, prepaid expenses, computers, servers, furniture, and customer accounts.
• Excluded Assets:
  • Cash (except for certain Excess Cash), bank accounts, and lease receivables.
  • Organizational documents, equity securities of any Seller, and employee benefit plans.
  • D&O liability insurance policies and attorney-client privilege held by the Sellers.
  • Excluded Claims and any loans payable to Sellers from employees.
• Assumed Liabilities: The Stalking Horse Bidder will assume specific Assumed Liabilities, including Cure Amounts.

Stalking Horse Bid

• The Stalking Horse Bidder has committed to acquire the assets for consideration consisting of:
  • Cash Payment to Debtors: $8 million (the "Closing Payment").
    • Subject to a $2 million reduction if the Katapult Litigation is dismissed or settled (the "Katapult Reduction").
    • Subject to a reduction of $350,000 if assets cannot be sold free and clear of rights granted under the Acima Settlement (the "Acima Reduction").
  • Warehouse Payment: A cash payment to the Administrative Agent of $7.5 million (the "Warehouse Amendment Transaction Payment").
    • Subject to a potential deduction of up to $1.5 million (50% of Excess DIP Amounts) if the DIP Lender makes advances exceeding $8 million.
  • Assumption of Liabilities: Assumption of Assumed Liabilities, including Cure Amounts.

Credit Bid

• The Stalking Horse Bidder is authorized to credit bid all amounts owed under the DIP Agreement (including accrued interest, fees, and expenses).
• The Stalking Horse Bidder may also credit bid the Break-Up Fee and Expense Reimbursement during the Auction.
• If the Closing Payment is paid via credit bid, it will be applied to amounts owed under the DIP Agreement.

Bid Protections

• Break-Up Fee: $620,000.
• Expense Reimbursement: Actual, reasonable, documented out-of-pocket expenses, capped at 2% of the Purchase Price.
• These protections constitute administrative expenses with superpriority status over other administrative expenses.

Overbid & Auction Mechanics

• Minimum Overbid: An initial overbid must exceed the aggregate sum of the Stalking Horse Closing Payment, Assumed Liabilities, Bid Protections, any Excess DIP, plus a minimum increment of $250,000.
• Bid Increments: Subsequent bids must be in increments of at least $250,000.
• Auction Process:
  • If Qualified Bids are received, an Auction will be held on Feb. 5, 2026.
  • Bidding will commence with a "Baseline Bid" determined by the Debtors.
  • The Debtors may conduct the Auction using open or closed bidding.
  • If no Qualified Bids are received, the Stalking Horse Bidder will be deemed the Successful Bidder.

Bid Requirements

• To be deemed a "Qualified Bidder," an interested party must submit a bid by the Bid Deadline that, among other things:
  • Financial Capacity: Provides written evidence of the ability to consummate the transaction, including adequate assurance of future performance for assumed contracts.
  • Deposit: Includes a Good Faith Deposit equal to 10% of the cash portion of the Purchase Price.
  • Marked Agreement: Includes an executed APA marked against the Stalking Horse Agreement.
  • No Contingencies: Is not conditioned on financing, due diligence, or internal approvals.
  • Commitment to Close: Commits to close within 80 days of the Petition Date.
  • Irrevocability: Remains irrevocable until the selection of the Successful Bid (or 90 days post-Petition Date if selected as Back-Up Bidder).

Assumption and Assignment

• The Debtors will file and serve a Cure Notice listing contracts to be assumed and proposed Cure Amounts within one business day of the Bid Procedures Order.
• Objections:
  • Objections to assumption, assignment, or cure amounts must be filed by Jan. 30, 2026.
  • If the Stalking Horse Bidder is not the Successful Bidder, counterparties have until Feb. 10, 2026, to file a Supplemental Adequate Assurance Objection.
• Failure to object constitutes consent to the assumption, assignment, and cure amount, and bars future claims regarding defaults or adequate assurance.

Sale Free and Clear & Successor Liability

• The Debtors seek to sell assets free and clear of all liens, claims, interests, and encumbrances under Bankruptcy Code section 363(f).
• The Sale Order will provide that the Buyer is not a successor to the Debtors and shall not bear successor liability.

Post-Closing Arrangements

• Warehouse Facility: The Stalking Horse Bidder agrees to enter into an amendment to the Warehouse Credit Agreement and pay the Warehouse Amendment Transaction Payment.
• Servicing: The Stalking Horse Bidder will enter into a servicing agreement to service Lease Receivables and assets owned by the SPV Borrower.
• Waiver of Stay: The Debtors request a waiver of the 14-day stay under Bankruptcy Rules 6004(h) and 6006(d).

Key Dates

• Bid Procedures Hearing: Jan. 14, 2025
• Cure Notice Deadline: 1 business day after entry of Bid Procedures Order
• Bid Deadline: Jan. 30, 2026, at 4:00 p.m. ET
• Sale / Contract Objection Deadline: Jan. 30, 2026
• Qualified Bid Designation Deadline: Feb. 2, 2026
• Auction: Feb. 5, 2026, at 10:00 a.m. ET
• Supplemental Objection Deadline (if applicable): Feb. 10, 2026, at 12:00 p.m. ET
• Sale Hearing: Feb. 11, 2026
• Closing Deadline: No later than 80 days following the Petition Date