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Full title: Stipulation, to incorporate certain Bank lender comments to Plan Filed by Debtor Professional Financial Investors, Inc. (RE: related document(s)513 Motion to Approve Document filed by Debtor Professional Financial Investors, Inc., Motion to Set Hearing, Motion Miscellaneous Relief). (Attachments: # 1 Proposed Order-FRBP 4001) (Lapping, Richard) (Entered: 05/11/2021)

Document posted on May 10, 2021 in the bankruptcy, 5 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

The failure to specifically identify in the Disclosure Statement (including the exhibits and schedules thereto) or the Plan any potential or 25 existing Avoidance Actions or Causes of Action as a PFI Trust Action is not intended to and shall not limit the rights of the PFI Trust to pursue any such 26 Avoidance Actions or Causes of Action.Unless a PFI Trust Action is expressly waived, relinquished, released, compromised, or settled in the Plan or any Final 27 Order (including the Confirmation Order), the Debtors expressly reserve such PFI Trust Action for later resolution by the PFI Trust (including any Avoidance 1 Actions or Causes of Action not specifically identified or of which the Debtors may presently be unaware or that may arise or exist by reason of additional facts 2 or circumstances unknown to the Debtors at this time or facts or circumstances that may change or be different from those the Debtors now believe to exist).As such, no preclusion doctrine, including the doctrines of res judicata, collateral estoppel, issue preclusion, claim preclusion, waiver, estoppel 4 (judicial, equitable, or otherwise), or laches will apply to any such Avoidance Actions or Causes of Action upon or after Confirmation of the Plan based on 5 the Disclosure Statement, the Plan, or the Confirmation Order, except when such Avoidance Actions or Causes of Action have been expressly released.c o, is not addressed in the Plan, although Debtors have moved to have LLC 28 deemed a Debtor Pacifincisc14 pursuant to Debtors’ Motion for Order of Substantive Consolidation of Non-Debtor Affiliates 0 ra Prior to confirmation of the Plan, the Plan Proponents shall amend the Plan to delete 1 the doctrines of res judicata, collateral estoppel, issue preclusion, claim preclusion, waiver,2 estoppel (judicial, equitable, or otherwise), or laches will apply to any such Avoidance Actions or3 Causes of Action upon or after Confirmation of the Plan based on the Disclosure Statement, the4 Plan, or the Confirmation Order, except when such Avoidance Actions or Causes of Action have 5 been expressly released.”

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Document Contents

1 Richard A. Lapping (SBN: 107496) TRODELLA & LAPPING LLP 2 540 Pacific Avenue San Francisco, CA 94133 3 Telephone: (415) 399-1015 Facsimile: (415) 651-9004 4 Email: Rich@TrodellaLapping.com 5 Conflicts Counsel for Debtors 6 7 UNITED STATES BANKRUPTCY COURT 8 NORTHERN DISTRICT OF CALIFORNIA, SAN FRANCISCO DIVISION 9 In re: Case No.: 20-30604 HLB (Jointly Administered) 10 PROFESSIONAL FINANCIAL INVESTORS, INC., a California corporation, Chapter 11 11 et al., 3 STIPULATION BY PLAN PROPONENTS 312 e 41 Debtors. TO FURTHER AMEND PLAN TO u9 c Aveno, CA 13 ICNECROTRAPINO RHAOTLED CEORSM OMFE NNOTNS -BY Pacifincisc14 ICNLVAEISMTSO R FIRST PRIORITY LENDER 40 Fra15 5n a S 16 17 This stipulation (the “Stipulation”) is entered into by and between the above-captioned 18 debtors and debtors in possession (collectively, the “Debtors”), the Official Committee of 19 Unsecured Creditors (the “Official Committee,” and together with the Debtors, the “Plan 20 Proponents”), and the holders of Non-Investor First Priority Lender Claims listed as signatories to 21 this Stipulation (collectively “Banks” and together with the Debtors, the “Parties”). 22 RECITALS 23 A. Professional Financial Investors, Inc. and certain of its affiliates became 24 debtors under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the 25 United States Bankruptcy Court for the Northern District of California (the “Bankruptcy Court”) 26 on various dates in 2020 and 2021 (collectively, the “Petition Dates”). On February 19, 2021, the 27 Bankruptcy Court ordered the joint administration of the Debtors’ cases for procedural purposes

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1 B. The Bankruptcy Court has jurisdiction over this matter pursuant to 28 U.S.C. § 2 1334, this matter is a core proceeding within the meaning of 28 U.S.C. § 157(b)(2), and venue is 3 proper pursuant to 28 U.S.C. §§ 1408 and 1409. 4 C. On March 21, 2021, the Plan Proponents filed that certain Joint Chapter 11 Plan of 5 Professional Finance Investors, Inc. and its Affiliated Debtors Proposed by the Debtors and 6 Official Committee of Unsecured Creditors and Supported by the Ad Hoc LLC Members 7 Committee and the Ad Hoc DOT Noteholders Committee [Docket No. 489] (as may be amended,8 modified, and supplemented, the “Plan”).1 The Plan reflects certain agreed-upon changes 9 resolving many of the concerns raised by the Banks during discussions with the Debtors. 10 Thereafter, the Banks have provided further comments and concerns to the attention of the 11 Debtors, that this Stipulation is intended to address. They are: 3 312 i. Section 1.23 of the Plan provides: e 41 u9 AvenCA 13 1.23 Claim Objection Deadline: Subject to extension as set forth in Section 70 c o, of the Plan, the date that is the first Business Day that is at least 180 calendar Pacifincisc14 days after the Effective Date. For the avoidance of doubt, the Claim Objection 0 ra Deadline may be extended one or more times by order of the Bankruptcy Court. 4F15 5n a The reference to Section 70 is incorrect and should refer to Section 7.2. S 16 ii. Section 2.2.3(b) of the Plan provides: 17 (b) In consideration of the waivers in clause (a) of subsection 2.2.3 and in 18 recognition of the oversecured status of all Class 1 Claims, no Avoidance Action, cause of action, or claim for relief based on constructive intent, 19 insolvency or lack of reasonable exchange value shall be asserted or lie against any Holder of a Class 1 Claim. 20 The reference to “cause of action” should state “Cause of Action,” which is a defined term in the21 Plan. 22 iii. Section 4.6.2 of the Plan provides, with emphasis added: 23 4.6.2 Preservation of All PFI Trust Actions Not Expressly Settled or 24 Released. The failure to specifically identify in the Disclosure Statement (including the exhibits and schedules thereto) or the Plan any potential or 25 existing Avoidance Actions or Causes of Action as a PFI Trust Action is not intended to and shall not limit the rights of the PFI Trust to pursue any such 26 Avoidance Actions or Causes of Action. Unless a PFI Trust Action is expressly waived, relinquished, released, compromised, or settled in the Plan or any Final 27 Order (including the Confirmation Order), the Debtors expressly reserve such PFI Trust Action for later resolution by the PFI Trust (including any Avoidance

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1 Actions or Causes of Action not specifically identified or of which the Debtors may presently be unaware or that may arise or exist by reason of additional facts 2 or circumstances unknown to the Debtors at this time or facts or circumstances that may change or be different from those the Debtors now believe to exist). 3 As such, no preclusion doctrine, including the doctrines of res judicata, collateral estoppel, issue preclusion, claim preclusion, waiver, estoppel 4 (judicial, equitable, or otherwise), or laches will apply to any such Avoidance Actions or Causes of Action upon or after Confirmation of the Plan based on 5 the Disclosure Statement, the Plan, or the Confirmation Order, except when such Avoidance Actions or Causes of Action have been expressly released. In 6 addition, the right to pursue or adopt any claims alleged in any lawsuit in which any Debtor, the PFI Trust, or the OpCo is a plaintiff, defendant, or an interested 7 party is fully reserved as against any Person that is not a Released Party, including the plaintiffs or co-defendants in such lawsuits.” 8 The Banks have expressed concerns to the Debtors that the italicized sentence above may be 9 interpreted to decide legal issues not before the Court in connection with the confirmation of the 10 Plan, and the Parties have agreed to amend the Plan to delete it. 11 D. HomeStreet Bank has commented to Debtors that its secured claim against 3 312 ue 941 Professional Investors 28, LLC (“LLC 28”), an affiliate of Debtors that is not currently a Debtor, AvenCA 13 c o, is not addressed in the Plan, although Debtors have moved to have LLC 28 deemed a Debtor Pacifincisc14 pursuant to Debtors’ Motion for Order of Substantive Consolidation of Non-Debtor Affiliates 0 ra 4F15 5n a Professional Investors 28, LLC and PFI Glenwood, LLC With Debtors [Docket No. 594] (the S 16 “Substantive Consolidation Motion”), and that HomeStreet Bank’s claim against LLC 28 should 17 be treated as a Class 1 Claim under the Plan. The Plan Proponents agree that the Plan should 18 treat claims against LLC 28 and PFI Glenwood, LLC as Class 1 Claims if they become 19 substantively consolidated with the Debtors. 20 NOW, THEREFORE, IT IS HEREBY STIPULATED AND AGREED AS 21 FOLLOWS: 22 1. The recitals set forth above are incorporated herein. 23 2. Prior to confirmation of the Plan, the Plan Proponents shall amend the Plan to correct24 the reference to Section 70 to Section 7.2 in Section 1.23 of the Plan. 25 3. Prior to confirmation of the Plan, the Plan Proponents shall amend the Plan to correct26 the reference “cause of action” in Section 2.2.3(b) of the Plan to “Cause of Action.” 27 4. Prior to confirmation of the Plan, the Plan Proponents shall amend the Plan to delete

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1 the doctrines of res judicata, collateral estoppel, issue preclusion, claim preclusion, waiver,2 estoppel (judicial, equitable, or otherwise), or laches will apply to any such Avoidance Actions or3 Causes of Action upon or after Confirmation of the Plan based on the Disclosure Statement, the4 Plan, or the Confirmation Order, except when such Avoidance Actions or Causes of Action have 5 been expressly released.” 6 5. Prior to confirmation of the Plan, and if the Substantive Consolidation Motion is7 granted as to LLC 28 and PFI Glenwood, LLC, the Plan Proponents shall amend the Plan to include8 the holders of claims against LLC 28 and PFI Glenwood, LLC as Class 1 Claims. 9 SO STIPULATED. 10 11 Dated: May 11, 2021 TRODELLA & LAPPING LLP 3 e 41312 AvenuCA 913 By: R /isc/h Raircdh Aar. dL Aap. pLianpgp ing c o, Conflicts Counsel for Debtors Pacifincisc14 0 ra PACHULSKI STANG ZIEHL & JONES LLP 54n F15 Sa 16 By: /s/ Debra Grassgreen Debra Grassgreen 17 Counsel for the Official Committee of Unsecured Creditors 18 LUBIN OLSON & NIEWIADOMSKI LLP 19 20 By: /s/ Dennis D. Miller Dennis D. Miller 21 Attorneys for Heritage Bank of Commerce 22 MORRISON & FOERSTER LLP 23 By: /s/ Mark A. Lightner 24 Mark A. Lightner Attorneys for JPMorgan Chase, N.A. 25 BOUTIN JONES INC. 26 27 By: /s/ Mark Gorton Mark Gorton

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1 ABBEY, WEITZENBERG, WARREN & EMERY, P.C. 2 3 By: /s/ Mitchell B. Greenberg Mitchell B. Greenberg 4 Attorneys for Poppy Bank 5 ALLEN MATKINS LECK GAMBLE MALLORY & NATSIS LLP 6 7 By: /s/ A. Kenneth Hennesay, Jr. A. Kenneth Hennesay, Jr. 8 Attorneys for Pacific Western Bank 9 MANATT, PHELPS & PHILLIPS, LLP 10 By: /s/ Ivan L. Kallick 11 Ivan L. Kallick Attorneys for Avidbank 3 312 e 41 u9 SNELL & WILMER AvenCA 13 c o, By: /s/ Joshua K. Partington 0 Pacifirancisc14 JAotsthournae Kys. fPoarr tBinagntnoenr Bank 4F15 5n a HEFNER, STARK & MAROIS, LLP S 16 17 By: /s/ Thomas P. Griffin, Jr. Thomas P. Griffin, Jr. 18 Attorneys for Five Star Bank 19 ALLEN MATKINS LECK GAMBLE MALLORY & NATSIS LLP 20 21 By: /s/ David R. Zaro David R. Zaro 22 Attorneys for HomeStreet Bank 23 ALDRIDGE | PITE, LLP 24 By: /s/ Christopher M. McDermott 25 Christopher M. McDermott Attorneys for OneUnited Bank 26 DUANE MORRIS LLP 27

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