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Full title: Statement of of Tri Counties Bank re Debtors' Motion to Approve Bid Procedures, Notice Procedures, Stalking Horse Agreement, Scheduling A Sale Hearing and Other Relief (RE: related document(s)713 Motion to Approve Document). Filed by Creditor Tri Counties Bank (Attachments: # 1 Certificate of Service) (Mouzes, Thomas) (Entered: 07/07/2021)

Document posted on Jul 6, 2021 in the bankruptcy, 5 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

The proposed Purchase Agreement attached to the Motion does not clearly reflect th19 each Class 1 Non-Investor First-Priority Lenders, such as TCB, whose real property collateral is to b20 sold is to be paid in full out of the escrow for the sale of applicable real property. 6 B. Claim No. 136-2, Claim amount, $2,596,711.73, Collateral Address in Deed of Trust: 7 17, 30, and 33 Clay Court, Novato, CA.Professional Investors 33, LLC, Case No. 2020-30935 19 A. Claim 2-1, Claim amount, $8,462,941.47, Collateral Address in Deed of Trust: 20 335 Enfrente Drive, Novato, CA. 27 28 2 A. Claim 2-1, Claim amount, $11,316,181.43, Collateral Address in Deed of Trust: 3 899 Northgate Drive, San Rafael, CA.Professional Investors Security Fund XVIII, Case No. 2020-30917 6 A. Claim 2-1, Claim amount, $22,638,231.67, Collateral Address in Deed of Trust: 7 8 380-450 Alameda Del Prado, Novato, CA (96 residential apartment units known as the 9 Ignacio Gardens).

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Document Contents

MARK GORTON (SBN 099312) 2 BOUTIN JONES INC. Attorneys at Law 3 555 Capitol Mall, Suite 1500 4 Sacramento, CA 95814 Phone: 916.321.4444 5 Fax: 916.441.7597 Email: tmouzes@boutinjones.com 6 mgorton@boutinjones.com 7 MARK H. ATKINS (SBN 122319) 8 BRUCE L. BELTON (SBN 114645) MARTHA EVENSEN OPICH (SBN 95117) 9 TRI COUNTIES BANK LEGAL DEPARTMENT 10 Post Office Box 992570 Redding, CA 96099-2570 11 Phone: (530) 879-4282 Fax: (530) 248-3300 12 Email: legalservice@tcbk.com 13 Attorneys for creditor Tri Counties Bank 14 15 UNITED STATES BANKRUPTCY COURT 16 NORTHERN DISTRICT OF CALIFORNIA 17 SAN FRANCISCO DIVISION 18 In re ) Case No. 20-30604 ) 19 ) (Jointly Administered) PROFESSIONAL FINANCIAL ) INVESTORS, INC., a California corporation; 20 ) Chapter 11 PROFESSIONAL INVESTORS SECURITY ) FUND, INC., a California corporation, 21 ) STATEMENT OF TRI COUNTIES BANK ) REGARDING DEBTORS’ MOTION TO Debtors. 22 ) APPROVE BID PROCEDURES, NOTICE ) PROCEDURES, STALKING HORSE 23 ) AGREEMENT, SCHEDULING A SALE ) HEARING AND OTHER RELIEF 24 ) ) Date: July 9, 2021 25 ) Time: 10:00 a.m. ) Place: Telephonic/Video Appearances Only 26 ) Judge: Honorable Hannah L. Blumenstiel ) 27 ) ) 28 )

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2 Bid Procedures, Notice Procedures, Authorizing Debtors To Enter Into The Stalking Hors3 Agreement, Scheduling A Sale Hearing And Other Relief (“Motion”). 4 1. TCB is the holder of eight secured claims against these jointly administered Debtor5 three with Professional Financial Investors, Inc. and five with the LLC/LP Debtors. The eight claim6 total more than $55.8 million and each claim is secured by a consensual first lien in collateral value7 by the Debtors in excess of the claim. TCB is over-secured. The secured claims of TCB ar8 summarized in the attachment to this document, but the amounts do not include any prepayment. 9 2. TCB is one of the Class 1 Non-Investor First-Priority Lenders in the confirmed Secon10 Amended Plan of the Debtors. The confirmed Second Amended Plan (Doc. Nos. 677, 678), provide11 in relevant part, that Class 1 Non-Investor First-Priority Lenders will be paid in full all secure12 indebtedness due the lender from the escrow upon the sale of the respective real property collatera13 See Second Amended Plan, section 2.2.1 and 2.2.2. However, the Purchase Agreement attached a14 Exhibit A to the Motion, at paragraph 2.2.1 (page 20 of 85 of the Motion), provides that the Allocate15 Purchase Price means the allocation of the Purchase Price to each site of Real Property as agreed upo16 by the parties pursuant to a separate written agreement, which agreement has not been disclosed in th17 Motion or to the Non-Investor First-Priority Lenders. 18 3. The proposed Purchase Agreement attached to the Motion does not clearly reflect th19 each Class 1 Non-Investor First-Priority Lenders, such as TCB, whose real property collateral is to b20 sold is to be paid in full out of the escrow for the sale of applicable real property. This uncertainty i21 the Motion concerning whether there will be any short sale of the real property collateral contrary t22 the confirmed Second Amended Plan and prior representations of the Debtors has been brought to th23 attention of the Debtors by a number of secured creditors. 24 4. Counsel for the Debtors has advised the Non-Investor First-Priority Lenders th25 Debtors intend to pay in full out of the sale escrow all liens of institutional lenders (Class 1 No26 Investor First-Priority Lenders) on the real properties sold and will make a statement on the record 27 the hearing on the Motion to confirm that there will be no short-sales of any real property collater28 and that the Debtors will pay in full all liens of the respective institutional lenders (Non-Investor First

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2 will be treated at all times as over-secured creditors. The sales estimates provided by the Debtors t3 the lenders reflect that the total sales price of the real properties to be sold substantially exceed th4 total indebtedness due the Class 1 Non-Investor First-Priority Lenders secured thereby. Debtors wi5 also make clear that the lenders’ rights and remedies are reserved and the proposed order will b6 modified to clearly state the same. 7 5. To the extent and in the event any real property collateral of TCB is to be sold and TC8 is not to be paid in full out of the escrow for all of the indebtedness secured thereby and/or Debtors d9 not intend to pay TCB in full out of the escrow for its respective loans secured by the real propert10 collateral, TCB objects. TCB is an over-secured creditor. 11 6. Second, the description of the real property, including addresses of the property, to b12 sold in Exhibit A-1 to the Purchase Agreement attached to the Motion, does not match with the addres13 information previously provided by the Debtors to TCB. Prior to this hearing, the Debtors’ couns14 confirmed to counsel for TCB that all of the real property collateral of TCB in these cases i15 encompassed by the Motion and the proposed purchase agreement, and is to be sold by the Debtor16 and TCB is to be paid in full. If this information is no longer accurate, TCB requests the Debtors full17 disclose any change and the reasons for the change, on the record. 18 7. Other secured creditors may raise additional issues and TCB reserves its right to rais19 additional issues at the hearing. 20 Respectfully submitted. 21 DATED: July 7, 2021 Mark H. Atkins TRI COUNTIES BANK LEGAL DEPARTMENT and 22 BOUTIN JONES INC. 23 24 By: /s/ Thomas G. Mouzes THOMAS G. MOUZES 25 MARK GORTON Attorneys for Creditor, Tri Counties Bank 26 27 28

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2 I. Professional Financial Investors, Inc., Case No. 2020-30604 3 A. Claim No. 135-2, Claim amount: $2,235,766.51, Collateral Address in Deed of Trust: 4 461 Ignacio Blvd, Novato, CA. TCB is informed that PFI refers to this collateral as 5 Ignacio Hills Tennis and Garden Apartments. 6 B. Claim No. 136-2, Claim amount, $2,596,711.73, Collateral Address in Deed of Trust: 7 17, 30, and 33 Clay Court, Novato, CA. TCB is informed that PFI refers to this collateral8 9 as Pacheco Villa. 10 C. Claim No. 137-1, Claim amount, $962,153.33, Collateral Address in Deed of Trust: 11 1 Clay Court, Novato, CA. TCB is informed that PFI also refers to this collateral as 12 Pacheco Villa. 13 II. Professional Investors 32, LLC, Case No. 2020-30934 14 A. Claim 3-1, Claim amount, $3,173,565.33, Collateral Address in Deed of Trust: 15 555 Northgate Drive, San Rafael, CA. TCB is informed that the Debtors refer to this 16 17 collateral as The Northgate Business Center. 18 III. Professional Investors 33, LLC, Case No. 2020-30935 19 A. Claim 2-1, Claim amount, $8,462,941.47, Collateral Address in Deed of Trust: 20 335 Enfrente Drive, Novato, CA. TCB is informed that the Debtors refer to this collatera21 as Ignacio Place. 22 IV. Professional Investors 36, LLC, Case No. 2020-30938 23 24 A. Claim 4, Claim amount, $5,193,762.96, Collateral Address in Deed of Trust: 25 350 Robinson Street, Sonoma, CA. TCB is informed that the Debtors refer to this 26 collateral as Village Green Apartments. 27 28

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2 A. Claim 2-1, Claim amount, $11,316,181.43, Collateral Address in Deed of Trust: 3 899 Northgate Drive, San Rafael, CA. TCB is informed that the Debtors refer to this 4 collateral as Northgate Professional Center. 5 VI. Professional Investors Security Fund XVIII, Case No. 2020-30917 6 A. Claim 2-1, Claim amount, $22,638,231.67, Collateral Address in Deed of Trust: 7 8 380-450 Alameda Del Prado, Novato, CA (96 residential apartment units known as the 9 Ignacio Gardens). 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

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