exhibit10_2.htm


    
      

      

    

    

      FIRST
AMENDMENT TO

      AMENDED
AND RESTATED TRUST AGREEMENT

       

      THIS
FIRST AMENDMENT TO AMENDED AND RESTATED TRUST AGREEMENT (this “Amendment”),
dated as of May 27, 2009, is entered into by and among (i) Vestin Realty
Mortgage II, Inc., a Maryland corporation (including any successors or permitted
assigns, the “Depositor”), (ii) The Bank of New York Mellon Trust Company,
National Association, a national banking association, as successor trustee to
The Bank of New York Trust Company, National Association, as property trustee
(in such capacity, the “Property Trustee”), (iii) Michael V. Shustek, an
individual, Daniel Stubbs, an individual, and Rocio Revollo, an individual, each
of whose address is c/o Vestin Realty Mortgage II, Inc., 6149 S. Rainbow Blvd.,
Las Vegas, Nevada 89118, as administrative trustees (in such capacities, each an
“Administrative Trustee” and, collectively, the “Administrative Trustees” and,
together with the Property Trustee and the Delaware Trustee, the “Trustees”) and
(iv) Taberna Preferred Funding VIII, Ltd. (“TPF VIII”) and Taberna Preferred
Funding IX, Ltd. (“TPF IX”, and together with TPF VIII, the
“Holders”).

       

      Witnesseth

       

      Whereas,
the Depositor and BNY Mellon Trust of Delaware (successor to The Bank of New
York (Delaware) (the “Delaware Trustee”) have heretofore created a Delaware
statutory trust pursuant to the Delaware Statutory Trust Act by entering into a
Trust Agreement, dated as of June 8, 2007 (the “Original Trust
Agreement”);

       

      Whereas,
the Depositor and the Trustees amended and restated the Original Trust Agreement
in its entirety by that certain Amended and Restated Trust Agreement dated as of
June 22, 2007 (as amended, modified, supplemented or restated, the “Trust
Agreement”; capitalized terms used herein without definition have the meanings
assigned thereto in the Trust Agreement) by and among the Depositor, the
Property Trustee, the Delaware Trustee and the Administrative Trustees, to
provide for, among other things, (i) the issuance of the Common Securities by
the Trust to the Depositor, (ii) the issuance and sale of the Preferred
Securities by the Trust pursuant to the Purchase Agreement and (iii) the
acquisition by the Trust from the Depositor of all of the right, title and
interest in and to the Notes;

       

      Whereas,
the Depositor and the Trustees desire to further amend the Trust Agreement as
set forth herein to provide for, among other things, (i) the cancellation of
23,750 of the Preferred Securities, (ii) the cancellation of a pro rata portion of the
Common Securities, and (iii) the requirement that the Depositor pay a $250,000
per annum modification fee, payable quarterly on each Distribution Date until
the Trust Securities are paid in full or otherwise retired; and

       

      Whereas,
the Holders have agreed to waive certain requirements of the Trust Agreement in
connection with the cancellation of securities on the Effective Date (as defined
below);

       

      Now,
Therefore, in consideration of the agreements and obligations set forth herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, each party, for the benefit of the other parties,
hereby agrees as follows:

       


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      ARTICLE
I

       

      AMENDMENTS

       

      Section
1.01                                Amendment to Section
1.1.  A new definition of “Modification Fee” shall be added to
Section 1.1 of the Trust Agreement in alphabetical order, which shall read in
its entirety as follows:

       

      “Modification Fee” has the
meaning specified in Section 4.1(a)(iii).

       

      Section
1.02                                Amendment to Section
4.1(a).  Section 4.1(a) of the Trust Agreement is hereby
amended and restated to read in its entirety as follows:

       

      “SECTION
4.1                                Distributions/Fees.

       

      (a)           The
Trust Securities represent undivided beneficial interests in the Trust Property,
and Distributions (including any Additional Interest Amounts and Modification
Fees, as defined below) will be made on the Trust Securities at the rate, in the
amount and on the dates that payments of interest (including any Additional
Interest) and fees are made on the Notes.  Accordingly:

       

      (i)           Distributions
on the Trust Securities shall be cumulative, and shall accumulate whether or not
there are funds of the Trust available for the payment of
Distributions.  Each date on which Distributions are payable in
accordance with this Section 4.1(a) is
referred to as a “Distribution Date.”

       

      (ii)           Interest
Distributions shall accumulate from June 22, 2007, and, except as provided in
this clause (a)(ii), shall be payable quarterly in arrears on January 30, April
30, July 30 and October 30 of each year, commencing on July 30,
2007.  Interest Distributions shall accumulate in respect of the Trust
Securities at a fixed rate equal to 8.75% per annum through the Interest Payment
Date in July 2012 (the “Fixed
Rate Period”) and thereafter at a variable rate equal to LIBOR plus 3.50%
per annum of the Liquidation Amount of the Trust Securities, such rate being the
rate of interest payable on the Notes.  LIBOR shall be determined by
the Calculation Agent in accordance with Schedule
A.  During the Fixed Rate Period, the amount of interest
Distributions payable for any period less than a full Distribution period shall
be computed on the basis of a 360-day year of twelve 30-day months and the
amount payable for any partial period shall be computed on the basis of the
number of days elapsed in a 360-day year of twelve 30-day
months.  Upon expiration of the Fixed Rate Period, the amount of
interest payable for any Distribution period will be computed on the basis of a
360-day year and the actual number of days elapsed in the relevant Distribution
period.  The amount of interest Distributions payable for any period
shall include any Additional Interest amounts in respect of principal and
interest for such period.

       


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      (iii)           A
$250,000 per annum Modification Fee (the “Modification Fee”) shall accrue from
April 30, 2009, and except as provided in this clause (a)(iii), shall be payable
quarterly in arrears in the amount of $62,500 on January 30, April 30, July 30
and October 30 of each year, commencing on July 30, 2009 to the Holders of the
Preferred Securities on a pro
rata basis based on the aggregate Liquidation Amount of Outstanding
Preferred Securities; provided that no portion of the Modification Fee shall be
payable with respect to Preferred Securities cancelled in connection with the
First Amendment to Amended and Restated Trust Agreement dated as of May 27,
2009.  The Modification Fee payable for any period less than a full
Distribution period shall be computed on the basis of a 360-day year of twelve
30-day months and the actual number of days elapsed in the
period.  The Modification Fee shall be payable until such time as no
Preferred Securities are Outstanding.  The amount of Distributions
payable with respect to the Modification Fee for any period shall include any
Additional Interest amounts in respect of the Modification Fee.

       

      (iv)           If
any date on which a Distribution is otherwise payable on the Trust Securities is
not a Business Day, then the payment of such Distribution shall be made on the
next succeeding Business Day (and no interest or fees shall accrue in respect of
the amounts whose payment is so delayed for the period from and after each such
date until the next succeeding Business Day), except that, if such Business Day
falls in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case, with the same force and effect
as if made on such date.

       

      (v)           Distributions
on the Trust Securities, including the Modification Fee, shall be made by the
Paying Agent from the Payment Account and shall be payable on each Distribution
Date only to the extent that the Trust has funds then on hand and available in
the Payment Account for the payment of such Distributions.”

       

      ARTICLE
II

      CANCELLATION
OF SECURITIES

       

      Section
2.01                                Cancellation of Preferred Securities
Certificate.  Section 4.9(a) of the Trust Agreement provides
that if the Depositor is the Owner or Holder of any Preferred Securities, it
shall have the right to deliver to the Property Trustee all or such portion of
its Preferred Securities as it elects and, subject to compliance with Sections
2.2 and 3.5 of the Indenture, receive, in exchange therefore, a Like Amount of
Notes.  As of the Effective Date, the Depositor is the Owner of 23,750
Preferred Securities with a Liquidation Amount of $23,750,000 (the “Depositor
Preferred Securities”).  On the terms and subject to the conditions
set forth in this Amendment, as of the Effective Date, the Depositor Preferred
Securities will be exchanged for a Like Amount of Notes.  After the
exchange, such Depositor Preferred Securities and a pro rata portion of the
Common Securities (the “Depositor Common Securities” and,


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      together
with the Depositor Preferred Securities, the “Cancelled Securities”) will be
canceled and will no longer be deemed to be Outstanding and all rights of the
Depositor with respect to such Cancelled Securities will
cease.  Furthermore, in lieu of registering such Like Amount of Notes
in the name of the Depositor, the Depositor consents to and does hereby agree
that such Like Amount of Notes shall be immediately cancelled by the Note
Trustee under the Indenture.

       

      


       

      ARTICLE
III

      CONDITIONS
TO EFFECTIVENESS

       

      Section
3.01                                Conditions
Precedent.  This Amendment, including the amendments to the
Trust Agreement effected hereby, shall become effective as of the date (such
date, the “Effective Date”) on which all of the following conditions are
satisfied:

       

      (a)           the
delivery of a counterpart of this Amendment duly executed by the Depositor, the
Property Trustee, each Administrative Trustee, TPF VIII and TPF IX;

       

      (b)           the
delivery of a fully executed counterpart of that certain Second Supplemental
Indenture dated as of even date herewith and evidence satisfactory to the
Property Trustee that all conditions precedent to the effectiveness of such
supplemental indenture have been satisfied; and

       

      (c)           the
Depositor shall have paid the reasonable costs and expenses (including but not
limited to legal fees) of the Property Trustee and the Delaware Trustee in
connection with this Amendment.

       

      Promptly
after the Effective Date, the Depositor shall cancel or caused to be cancelled a
pro rata portion of the Common Securities.

       

      ARTICLE
IV

      WAIVER
OF CERTAIN CONDITIONS

       

      Section
4.01                                Waiver of Certain Requirements in
Connection with Cancellation of Securities.  Each of the
Depositor, the Holders and the Administrative Trustees hereto waive, and do
hereby direct the Trustee to waive, all timing and procedural requirements with
respect to the cancellation of the Cancelled Securities, including those set
forth in Section 4.9(a) of the Trust Agreement.

       

      Section
4.02                                Waiver of Requirement to Deliver Tax
Opinion.  Each of the Depositor, the Holders and the
Administrative Trustees hereby directs the Trustee to enter into this Amendment
and hereby waive the requirement for delivery of the Opinion of Counsel as
described in Section 10.3(b) of the Trust Agreement to the effect that this
Amendment will not cause the Trust to be taxable as a corporation or to be
classified as other than a grantor trust for United States federal income tax
purposes or that would cause the Notes to fail or cease to be treated as
indebtedness of the Depositor for United States federal income tax purposes or
that

       


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      would
cause the Trust to fail or cease to qualify for the exemption from status (or
from any requirement to register) as an “investment company” under the
Investment Company Act.

       

      ARTICLE
V

      REPRESENTATIONS
AND WARRANTIES

       

      Section
5.01                                Representations and Warranties of the
Holders.  Each of TPF VIII and TPF IX
hereby severally (and not jointly and severally) represents and warrants
that:

       

      (a)           It
owns and is the Holder of $28,125,000 of Preferred Securities; provided subject
only to the satisfaction of the conditions precedent set forth in Article III
and consummation of the release of securities and cash to TPF VIII and TPF IX
pursuant to that certain Joint Written Direction Regarding Custodial Assets
dated as of even date herewith (the “Joint Written Direction”) by and among the
Depositor, TPF VIII and TPF IX, each of TPF VIII and TPF IX shall transfer all
right, title and interest in Preferred Securities with a Liquidation Value of
$10,000,000 to the Depositor; and

       

      (b)           It
(i) consents to the Property Trustee executing and delivering this Amendment,
(ii) directs the Property Trustee to execute and deliver this Amendment and
(iii) agrees to and does hereby release the Property Trustee for any action
taken or to be taken by the Property Trustee in connection with its execution
and delivery of this Amendment and for any liability or responsibility arising
in connection herewith.

       

      Section
5.02                                Representations and Warranties of the
Depositor.  The Depositor hereby represents and warrants
that:

       

      (a)           prior
to the release of securities and cash described in the Joint Written Direction
and the cancellation described in Section 2.01, it owns and is the Holder of
$3,750,000 of Preferred Securities; and

       

      (b)           concurrently
with the Effective Date, it is the beneficial owner of the Cancelled
Securities.

       

      Section
5.03                                Representations and Warranties of
Each Party Hereto.  Each party hereto represents and warrants
that this Amendment has been duly and validly executed and delivered by it and
is legal, valid and binding upon and enforceable against it in accordance with
its terms.

       

      Section
5.04                                Consent and Direction to
Trustee.  By execution of this Amendment, each of the
Depositor, the Trust and the Administrative Trustees (i) consents to the
Property Trustee executing and delivering this Amendment, (ii) directs the
Property Trustee to execute and deliver this Amendment and (iii) agrees to and
does hereby release the Property Trustee for any action taken or to be taken by
the Property Trustee in connection with its execution and delivery of this
Amendment and for any liability or responsibility arising in connection
herewith.

       

      ARTICLE
VI

      MISCELLANEOUS
PROVISIONS

       


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      Section
6.01                                Governing
Law.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
HOLDERS, THE TRUST, THE DEPOSITOR AND THE TRUSTEES WITH RESPECT TO THIS TRUST
AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE WITHOUT REFERENCE TO ITS
CONFLICTS OF LAWS PROVISIONS.

       

      Section
6.02                                No Other
Amendments.  Except as hereby expressly modified, the Trust
Agreement and the Securities issued thereunder are ratified and confirmed and
all the terms, conditions and provisions thereof shall remain in full force and
effect.

       

      Section
6.03                                Headings.  The
Article and Section headings are for convenience only and shall not affect the
construction of this Amendment.

       

      Section
6.04                                Trustee Acceptance. The
Trustee shall not be responsible in any manner whatsoever for the validity or
sufficiency of this Amendment or the due execution hereof by the by any party
hereto other than the Property Trustee or for or in respect of the recitals and
statements contained herein, all of which recitals and statements are made
solely by the Depositor.

       

      Section
6.05                                Counterparts.  This
instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.

       

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      IN
WITNESS WHEREOF, the parties hereto have executed this First Amendment to
Amended and Restated Trust Agreement as of the day and year first above
written.

       

      VESTIN
REALTY MORTGAGE II, INC., as Depositor

       

      


       

      


       

      By:     /s/ Michael
Shustek                                                                

       

        Name:  Michael
Shustek

        Title:  President and
Chief Executive Officer

       

      VESTIN II
CAPITAL TRUST I

       

      


       

      By:     /s/ Michael
Shustek                                                                

               
Name:  Michael Shustek

               
Title:  Administrative Trustee

      


      
        	
                THE
      BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, a national
      banking association, as successor trustee to The Bank of New York Trust
      Company, National Association,

                as
      Property Trustee

              	 
      
	 
      	 
      
	 
      	 
      
	
                By:   /s/ Bill
      Marshall                                                                

              	 
      
	
                Name: Bill
    Marshall

              	 
      
	
                Title: Vice
    President

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	
                    /s/ Michael V.
      Shustek                                                                

              	
                      /s/ Daniel
      Stubbs

              
	
                Administrative
      Trustee

              	
                Administrative
      Trustee

              
	
                Name:  Michael
      V. Shustek

              	
                Name:  Daniel
      Stubbs

              
	 
      	 
      
	 
      	 
      
	 
      	 
      
	
                  /s/ Rocio
      Revollo                                                                

              	 
      
	
                Administrative
      Trustee

              	 
      
	
                Name:  Rocio
      Revollo

              	 
      


      

      



      
        
           


        

        
           


          
            

          

        

        
           


        

      


      TABERNA
PREFERRED FUNDING VIII, LTD.

      


      


      By:     /s/ Alasdair
Foster                                                                

      Name: Alasdair Foster

      Title:  Director

      


      


      TABERNA
PREFERRED FUNDING IX, LTD.

      


      


      By:     /s/ Alasdair
Foster                                                                

      Name: Alasdair Foster

      Title:  Director