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Full title: Notice Regarding Notice of Sale, Bidding Procedures, Auction, Sale Hearing, and Investor Opt-Out Procedures Filed by Debtor Professional Financial Investors, Inc. (Marum, J.) (Entered: 07/19/2021)

Document posted on Jul 18, 2021 in the bankruptcy, 9 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

4 PLEASE TAKE FURTHER NOTICE that, on June 28, 2021, the Debtors filed a motio5 (the “Bid Procedures Motion”) with the Court seeking, among other things, (a) an order (the “Bid6 Procedures Order”) (i) authorizing and approving the proposed bidding procedures to be used (the7 “Bid Procedures”) in connection with the portfolio sale (the “Sale”) of the Debtors’ Property, 8 which is described in greater detail at Exhibit A attached hereto; (ii) approving the Break-up Fee 9 and Expense Reimbursement to be provided by the Debtors to Hamilton Zanze & Company 10 (“Hamilton Zanze”) as the Stalking Horse Bidder; (iii) scheduling the auction of the Property (the11 “Auction”); (iv) setting a hearing to approve the Sale (the “Sale Hearing”), and (v) approving the 12 forms of notice and notice procedures related to the Bid Procedures, Auction and Sale (the 13 “Auction Notice Procedures”).Notwithstanding that the Debtors will give separate notice of the Sale Hearing on the 26 Sale Motion, please note that any party who fails to make a timely objection to the Sale on or 27 before the Sale Objection Deadline in accordance with the Bid Procedures Order and this 28 1 Notice or the Sale Hearing Notice shall be forever barred from asserting any objection to the 2 Sale, including with respect to the transfer of the Property free and clear of all liens, claims, 3 encumbrances and other interests.25 26 27 28 1 INVESTOR OPT-OUT PROCEDURE 2 PLEASE TAKE FURTHER NOTICE that on July 3, 20201, in connection with the Bid3 Procedures Motion, the Debtors filed an application (the “Investor Opt-Out Application”) with th4 Court seeking Court approval of a procedure by which Investors (as defined in the Investor Opt-5 Out Application) may notify the Debtors of whether they desire not to be contacted by the 6 Hamilton Zanze, the Stalking Horse Bidder for the Sale of the Property. 9 PLEASE TAKE FURTHER NOTICE that under the Stalking Horse APA, Hamilton 10 Zanze proposes to acquire the Property, which includes the Debtors’ Real Property, Personal 11 Property, and Intellectual Property (each as defined in the Stalking Horse APA), subject to overbi12 at an Auction. (the “Opt-out Period”) during which each Investor may: (a) determine whether he or she desires t26 be contacted by Hamilton Zanze as the Stalking Horse Bidder or another Potential Bidder 27 regarding investment opportunities in connection with the proposed Sale of the Property at 28 Auction, and (b) notify the Debtors whether he or she desires not to be contacted, via email to 1 investors@investpfi.com.

List of Tables

Document Contents

1 SHEPPARD, MULLIN, RICHTER & TRODELLA & LAPPING LLP HAMPTON LLP RICHARD A. LAPPING, Cal. Bar No. 107496 2 A Limited Liability Partnership 540 Pacific Avenue Including Professional Corporations San Francisco, CA 94133 3 ORI KATZ, Cal. Bar No. 209561 Telephone: (415) 399-1015 J. BARRETT MARUM, Cal. Bar No. 228628 Facsimile: (415) 651-9004 4 JEANNIE KIM, Cal. Bar No. 270713 Email: Rich@TrodellaLapping.com MATT KLINGER, Cal. Bar No. 307362 Conflicts Counsel for the Debtors and Counsel 5 Four Embarcadero Center, 17th Floor for San Francisco, California 94111-4109 Professional Investors 28, LLC and PFI 6 Telephone: 415.434.9100 Glenwood, LLC Facsimile: 415.434.3947 7 Email: okatz@sheppardmullin.com bmarum@sheppardmullin.com 8 jekim@sheppardmullin.com mklinger@sheppardmullin.com 9 Counsel for the Debtors 10 UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF CALIFORNIA , SAN FRANCISCO DIVISION 11 In re Case No. 20-30604 12 PROFESSIONAL FINANCIAL (Jointly Administered) 13 INVESTORS, INC., et al., Chapter 11 14 Debtors.1 NOTICE OF SALE, BIDDING 15 PROCEDURES, AUCTION, SALE HEARING, AND INVESTOR OPT-OUT 16 PROCEDURES 17 Auction Date: September 13, 2021 Sale Hearing: September 15, 20212 18 Time: 10:00 a.m. Place: Telephonic/Video Appearance 19 Only 450 Golden Gate Avenue, 20 Courtroom 19, 16th Fl., San Francisco, CA 94102 21 Judge: Hon. Hannah L. Blumenstiel PLEASE TAKE NOTICE (the “Notice”)3 that orders for relief under chapter 11 of title 22 11 of the United States Code (the “Bankruptcy Code”) have been entered by the United States 23 1 A complete list of the Debtors and their respective chapter 11 case numbers may be found at 24 www.donlinrecano.com/pfi. The federal tax identification numbers of each of the Debtors25 is available in the bankruptcy petitions of each Debtor, each of which also is available at the Donlin Recano website. 26 2 As set forth in greater detail herein, if all timely objections to the Sale Motion have been resolved in advance of the Sale Hearing and the Debtors have notified the Court of such 27 resolution. If such timely objections to the Sale Motion have not been resolved, the Sale 28 Hearing will take place on September 17, 2021, at 10:00 a.m.

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1 Bankruptcy Court for the Northern District of California (the “Court”) in the above-captioned 2 bankruptcy cases of Professional Financial Investors, Inc. and its affiliated debtors and debtors in 3 possession (collectively, the “Debtors”). 4 PLEASE TAKE FURTHER NOTICE that, on June 28, 2021, the Debtors filed a motio5 (the “Bid Procedures Motion”) with the Court seeking, among other things, (a) an order (the “Bid6 Procedures Order”) (i) authorizing and approving the proposed bidding procedures to be used (the7 “Bid Procedures”) in connection with the portfolio sale (the “Sale”) of the Debtors’ Property, 8 which is described in greater detail at Exhibit A attached hereto; (ii) approving the Break-up Fee 9 and Expense Reimbursement to be provided by the Debtors to Hamilton Zanze & Company 10 (“Hamilton Zanze”) as the Stalking Horse Bidder; (iii) scheduling the auction of the Property (the11 “Auction”); (iv) setting a hearing to approve the Sale (the “Sale Hearing”), and (v) approving the 12 forms of notice and notice procedures related to the Bid Procedures, Auction and Sale (the 13 “Auction Notice Procedures”). 14 PLEASE TAKE FURTHER NOTICE that on July 15, 2021, the Court entered the Bid 15 Procedures Order approving, among other things, the Bid Procedures, which establish the key 16 dates and times related to the Sale and the Auction. All interested bidders should carefully read 17 the Bid Procedures Order and the Bid Procedures in their entirety.4 18 PLEASE TAKE FURTHER NOTICE that the Debtors will give separate notice of the 19 Sale Hearing to consider Court approval of the Sale of the Property to the Successful Bidder at th20 Auction (the “Sale Motion”) 5 and the deadline for parties in interest to object or otherwise 21 22 3 Capitalized terms not otherwise defined in this Notice shall have the same meanings ascribed t23 them in the Bid Procedures Motion. 24 4 To the extent of any inconsistencies between the Bid Procedures and the summary descriptions of the Bid Procedures in this Notice, the terms of the Bid Procedures set forth in the Bid 25 Procedures Order shall control in all respects. 26 5 The foregoing is only a general summary of the relief that the Debtors intend to seek by the SaleMotion. All parties are strongly advised to review the Sale Motion itself once filed with 27 the Court. To the extent that the foregoing summary is inconsistent in any way with the 28 relief sought by the Sale Motion, the Sale Motion shall control.

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1 respond to the Sale Motion in accordance with the applicable Bankruptcy Rules and this Court’s 2 Bankruptcy Local Rules. 3 Important Dates and Deadlines 4 1. Bid Deadline. The deadline to submit a Qualified Bid is September 7, 2021, at 5 5:00 p.m. (prevailing Pacific Time). 6 2. Auction. In the event that the Debtors timely receive a Qualified Bid in addition t7 the Qualified Bid of the Stalking Horse Bidder, and subject to the satisfaction of any further 8 conditions set forth in the Bidding Procedures, the Debtors intend to conduct an Auction for the 9 Property. The Auction, if one is held, will commence on September 13, 2021, at 11:00 a.m. 10 (prevailing Pacific Time), at FTI Consulting’s San Francisco Office located at 50 California 11 Street, Suite 1900, provided that conducting the auction in person will fully comply with local 12 health orders. The Debtors reserve the right to conduct the Auction via videoconference should 13 they determine, after consultation with the Official Committee, that an Auction by 14 videoconference is appropriate given the COVID-19 pandemic. At the Auction, only Qualified 15 Bidders (including the Stalking Horse Bidder) will be permitted to bid. Qualified Bidders may 16 participate in person or by authorized representative. The Debtors shall timely communicate the 17 date, time, and method for conducting the Auction to all parties entitled to attend the Auction. 18 3. Post-Auction Objection and Sale Objection Deadlines. 19 a. The deadline to file an objection with the Court to the Sale (other than 20 objections related to the specific identity of a Successful Bidder other than the Stalking 21 Horse Bidder) is September 1, 2021 (the “Sale Objection Deadline”), as will be set forth 22 in the forthcoming notice of the Sale Hearing. 23 b. If the Auction is held, parties may object to the conduct of the Auction, the 24 specific identity of the Successful Bidder (other than the Stalking Horse Bidder), the Sale 25 Order and adequate assurance of future performance provided by a Successful Bidder 26 (other than the Stalking Horse Bidder) at the Sale Hearing (the “Post-Auction Objection 27 Deadline”). 28

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1 4. Sale Hearing. As set forth above, the Debtors will give separate notice of the Sale 2 Hearing to approve and authorize the Sale to the Successful Bidder and the specific relief 3 requested by the Sale Motion, which the Court has set for September 15, 2021, at 10:00 a.m. 4 (prevailing Pacific Time) if all timely objections to the Sale Motion have been resolved in advanc5 of the Sale Hearing and the Debtors have notified the Court of such resolution. If such timely 6 objections to the Sale Motion have not been resolved, the Sale Hearing will take place on 7 September 17, 2021, at 10:00 a.m. 8 Contact Person for Parties Interested in Submitting a Bid 9 The Bid Procedures set forth the requirements for becoming a Qualified Bidder and 10 submitting a Qualified Bid, and any party interested in making an offer to purchase the Assets 11 must comply strictly with the Bid Procedures. Only Qualified Bids will be considered by the 12 Debtor, in accordance with the Bid Procedures. 13 Any party interested in submitting a bid should carefully read the Bid Procedures and the 14 Bid Procedures Order and should contact, as soon as possible: 15 FTI Consulting, Inc. 50 California Street, Suite 1900 16 San Francisco, CA 94111 Attn: Greg Gotthardt or Sofi Daar 17 greg.gotthardt@fticonsulting.com | 213-452-6323 sofi.daar@fticonsulting.com | 213-452-6077 18 Obtaining Additional Information 19 Copies of the Bid Procedures Motion, the Bid Procedures and the Bid Procedures Order, a20 well as all related exhibits, including the Stalking Horse APA and all other documents filed with 21 the Court, are available free of charge on the Debtors’ case information website, 22 http://www.donlinrecano.com/pfi or can be requested by email at pfiinfo@donlinrecano.com, or 23 by calling the toll-free information line at 1-877-283-0316. 24 CONSEQUENCES OF FAILING TO TIMELY ASSERT AN OBJECTION 25 Notwithstanding that the Debtors will give separate notice of the Sale Hearing on the 26 Sale Motion, please note that any party who fails to make a timely objection to the Sale on or 27 before the Sale Objection Deadline in accordance with the Bid Procedures Order and this 28

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1 Notice or the Sale Hearing Notice shall be forever barred from asserting any objection to the 2 Sale, including with respect to the transfer of the Property free and clear of all liens, claims, 3 encumbrances and other interests. 4 Notwithstanding that the Debtors will give separate notice of the Sale Hearing on the 5 Sale Motion, please note that any party who fails to make a timely Post-Auction Objection on o6 before the Post-Auction Objection Deadline in accordance with the Bid Procedures Order and 7 this Notice shall be forever barred from asserting any Post-Auction Objection, including with 8 respect to the transfer of the Property free and clear of all liens, claims, encumbrances and 9 other interests. 10 NO SUCCESSOR LIABILITY 11 Notwithstanding that the Debtors will give separate notice of the Sale Hearing on the 12 Sale Motion, please note that the Sale will be free and clear of, among other things, any claim 13 arising from any conduct of the Debtors prior to the closing of the Sale, whether known or 14 unknown, whether due or to become due, whether accrued, absolute, contingent or otherwise, 15 so long as such claim arises out of or relates to events occurring prior to the closing of the Sale16 Accordingly, as a result of the Sale, the Successful Bidder will not be a successor to the Debtor17 by reason of any theory of law or equity, and the Successful Bidder will have no liability, excep18 as expressly provided in the Asset Purchase Agreement, for any liens, claims, encumbrances 19 and other interests against or in the Debtors under any theory of law, including successor 20 liability theories. 21 22 23 24 25 26 27 28

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1 INVESTOR OPT-OUT PROCEDURE 2 PLEASE TAKE FURTHER NOTICE that on July 3, 20201, in connection with the Bid3 Procedures Motion, the Debtors filed an application (the “Investor Opt-Out Application”) with th4 Court seeking Court approval of a procedure by which Investors (as defined in the Investor Opt-5 Out Application) may notify the Debtors of whether they desire not to be contacted by the 6 Hamilton Zanze, the Stalking Horse Bidder for the Sale of the Property. On July 12, 2021, the 7 Court entered an order granting the Investor Opt-Out Application and approving the Opt-Out 8 Procedures (as defined in the Investor Opt-Out Application). 9 PLEASE TAKE FURTHER NOTICE that under the Stalking Horse APA, Hamilton 10 Zanze proposes to acquire the Property, which includes the Debtors’ Real Property, Personal 11 Property, and Intellectual Property (each as defined in the Stalking Horse APA), subject to overbi12 at an Auction. The proposed Sale of, among other things, the Debtors’ Intellectual Property, 13 provides for the sale of the Debtors’ investor lists, which includes in addition to Investors’ names 14 and mailing addresses that already are of public record in the Debtors’ respective bankruptcy 15 cases. In connection with the proposed Sale, Hamilton Zanze has requested the following with 16 respect to each of the Investors, for the purpose of contacting the Investors about potential 17 investment opportunities in connection with the proposed Sale: 18 1. email address(es); 19 2. telephone number(s); 20 3. the dollar amount invested with the Debtors, by Real Property if available; 21 and 22 4. the type of investment held (i.e., deed of trust, note, or limited liability 23 company or partnership interest) (collectively, “Investor Contact Information”). 24 PLEASE TAKE FURTHER NOTICE that Investors shall have a fifteen (15)-day perio25 (the “Opt-out Period”) during which each Investor may: (a) determine whether he or she desires t26 be contacted by Hamilton Zanze as the Stalking Horse Bidder or another Potential Bidder 27 regarding investment opportunities in connection with the proposed Sale of the Property at 28 Auction, and (b) notify the Debtors whether he or she desires not to be contacted, via email to

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1 investors@investpfi.com. The Opt-out Period shall commence on July 20, 2021, and end at 2 11:59 p.m., prevailing Pacific Time, on August 4, 2021. 3 PLEASE TAKE FURTHER NOTICE that the Debtors will not be sharing any 4 Investor’s personally identifiable information such as social security numbers, bank or investment5 account information, or beneficiary information, with Hamilton Zanze or any other party. 6 PLEASE TAKE FURTHER NOTICE that beginning on August5, 2021, the Debtors 7 will remove from their list of Investors the Investor Contact Information of any Investor who has 8 indicated that he or she does not desire to be contacted by Hamilton Zanze or others in connection9 with investment opportunities related to the proposed Sale of the Property. 10 Should you have any questions or concerns regarding the foregoing, please contact the 11 Debtors’ financial advisor, FTI Consulting, Inc., at investors@investpfi.com. 12 Dated: July 19, 2021 13 SHEPPARD, MULLIN, RICHTER & HAMPTON LLP 14 15 By /s/ J. Barrett Marum J. BARRETT MARUM 16 17 Attorneys for the Debtors 18 19 20 21 22 23 24 25 26 27 28

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1 Exhibit A 2 Description of Property to Be Sold 3 The “Property,” as more fully described in section 1.1 of the Stalking Horse APA, include4 the following: 5 1. Real Property (as defined in the Stalking Horse APA) consisting of: 6 a. 60 fee interests in commercial and multifamily residential real properties a7 more particularly described on Exhibit A-1 to the Stalking Horse APA (as defined in the 8 Stalking Horse APA, the “Land”); and 9 b. the Improvements (as defined in the Stalking Horse APA) to the Land in th10 form of buildings, structures, improvements, and fixtures that the Debtors own and that ar11 located on the Land; 12 2. Tangible personal property used by the Debtors in the operation and management 13 of the Real Property (the “Business”), including, but not limited to: 14 a. the Debtors’ books and records related to the Real Property; 15 b. all removable furnishings at each of (i) the Real Properties, and (ii) PFI’s 16 corporate headquarters located at 350 Ignacio Blvd, Suite 100 (“PFI HQ”) including, 17 without exception, artwork, furniture, equipment, and inventory located at the PFI HQ, 18 Debtors’ maintenance shops (whether any such maintenance shop is located at the PFI HQ19 or elsewhere), and in the common areas of each Real Property (collectively, “Common 20 Areas”); 21 c. other equipment (including, information technology equipment), tools, 22 machinery, inventory used in the Business whether located at the PFI HQ, the Common 23 Areas, or elsewhere on each of the Real Properties; 24 d. vehicles; and 25 e. Leasehold improvements (collectively, “Personal Property”); 26 27 28

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1 3. Certain intellectual and intangible property (collectively, “Intellectual Property”);6 2 and 3 4. Certain Leases and Contracts (each as defined in the Stalking Horse APA and 4 referenced herein as the “Executory Contracts and Leases”) that the Stalking Horse Bidder may 5 elect to have the Debtors assume and assign to the Stalking Horse Bidder (“Purchased Contracts 6 and Leases”). 7 5. Notwithstanding the foregoing, the Property shall not include any of the Debtors’ 8 right, title, or interest in or to the following (collectively, the “Excluded Assets”): 9 a. any lump sum or upfront payments paid to or earned by the Debtors or thei10 predecessors under any of the Executory Contracts and Leases that are not assumed and 11 assigned to Stalking Horse Bidder, 12 b. any unearned insurance premiums, 13 c. any insurance policies or insurance contracts owned or held by the Debtors14 and their affiliates in connection with the Property prior to the Closing Date, 15 d. any and all deposits, cash and other accounts owned or held by the Debtors16 and their affiliates, except for any unapplied refundable tenant security deposits, 17 e. Executory Contracts and Leases that are not assumed by and assigned to th18 Stalking Horse Bidder, and 19 f. any and all claims, demands, lawsuits, legal proceedings, awards, 20 judgments, or settlement amounts related to or arising from the Debtors’ purchase of the 21 Real Property from the prior owner(s), the Debtors’ prepetition management team, or othe22 third parties, excluding, however, Environmental Claims (as defined in the Stalking Horse23 APA), and personal property included on Exhibit A-3 of the Stalking Horse APA. 24 25 26 6 The Stalking Horse APA provides for the sale of all of the Debtors’ Intellectual Property, including the contact information for their investors. The Stalking Horse Bidder, in 27 consultation with the Debtors, may contact investors regarding the Property in accordance28 with the Investor Opt-Out Procedures described in this Notice.

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