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7.1.1. - Page 3 <br />FIRST AMENDMENT TO NOTE SECURED BY DEED OF TRUST <br />THIS FIRST AMENDMENT TO NOTE SECURED BY DEED OF TRUST <br />("Agreement") is dated as of September 1, 2013, for reference purposes, by and between <br />SHORES CHILDCARE, LLC, a California limited liability company organized and existing <br />under the laws of the State of California ("Borrower") and CITY OF REDWOOD CITY, a <br />charter city and municipal corporation ("Lender") collectively ("Parties") who agree as follows: <br />RECITALS <br />A. Borrower executed that certain Note Secured by Deed of Trust dated <br />January 1, 2003 ("Note"), which Note is secured by that certain Leasehold Deed of Trust, <br />Assignment of Rents, Security Agreement and Fixture Filing recorded on February 11, 2003, as <br />Document No. 2003-035252 in the Official Records of San Mateo County, with a true and <br />correct copy of said Note attached to this Agreement as Exhibit "A"; and <br />B. The Parties have negotiated and agreed to increase the interest rate on the <br />outstanding balance due under the Note from Borrower to Lender, in lieu of Lender exercising its <br />right under the Note to call the full amount of the Note immediately due and payable; and <br />C. The purpose of this Agreement is to amend the Note's interest rate to add <br />250 basis points to the LAIF apportionment rate for payments due to Lender for the outstanding <br />balance of the Note beginning with the payment due on October 1, 2013. <br />NOW, THEREFORE, for good and valuable consideration, the receipt and <br />sufficiency of which are hereby acknowledged, the parties hereby amend the Note and agree as <br />follows: <br />1. The Note is hereby amended by deleting the entire first sentence of the <br />first paragraph (as described below): <br />"FOR VALUE RECEIVED, SHORES CHILDCARE, LLC, a California <br />limited liability company (collectively "Borrower") promise(s) to pay to the order of THE CITY <br />OF REDWOOD CITY, a municipal corporation ("Lender"), at 1017 Middlefield Road, <br />Redwood City, California, or at such other place as the holder of this Note may from time to time <br />designate in writing, the principal sum of three million two hundred thousand dollars <br />($3,200,000) together with interest from the Close of Escrow in connection with Borrower's <br />acquisition of the real property described in the Leasehold Deed of Trust securing this Note (the <br />"Delivery Date"), computed on the outstanding principal balance hereof at an interest rate per <br />annum equal to the Local Agency Investment Fund ("LAIF") apportionment rate as published <br />from time to time by the Treasurer of the State of California applicable as of the immediately <br />preceding calendar quarter to and including the Maturity Date hereof (as hereinafter defined)." <br />ATTY/AGR/2013.159/FIRST AMENDMENT TO NOTE SECURED BY DEED OF TRUST SHORES CHILDCARE <br />REV: 09-09-13 MLG <br />Page 1 of 2 <br />