Document:

Intercreditor Agreement 10-13-06

    
      

      

    

    

      Exhibit
        10.8

      

      INTERCREDITOR
        AGREEMENT

      

      THIS
        INTERCREDITOR AGREEMENT, dated as of October 13, 2006 (this “Agreement”), is
        entered into by and between VESTIN MORTGAGE, INC., a Nevada corporation
        (“Vestin”), VESTIN ORIGINATIONS, INC., a Nevada corporation (“Originations”),
        VESTIN REALTY MORTGAGE I, Inc., a Maryland corporation (“VRM
        I”), VESTIN
        REALTY MORTGAGE II, Inc., a Maryland corporation (“VRM
        II”) and
        VESTIN FUND Ill, LLC, a Nevada limited liability company (“VF III”) whose
        principal place of business and post office address is 8379 West Sunset Road,
        Las Vegas, Nevada. 89113, (individually, “Lead Lender, or collectively, “Lead
        Lenders” and OWENS FINANCIAL GROUP, INC.., a California corporation (“Owens
        Financial”) and OWENS MORTGAGE INVESTMENT FUND, a California Limited Partnership
        (“Owens Mortgage Investment Fund”) whose principal place of business and post
        office address is 2221 Olympic Boulevard, Walnut Creek, California 94595,
        (individually, a “Lender”, or collectively, “Lenders”)

      

      RECITALS:

      

      	A.  	
              VRM
                I is a publicly traded Mortgage REIT that provides financing secured
                by
                deeds of trust or mortgages on real
                property.

            

      

      	B.  	
              VRM
                II is a publicly traded Mortgage REIT that provides financing secured
                by
                deeds of trust or mortgages on real
                property.

            

      

      	C.  	
              Vestin
                Fund Ill is a SEC registered direct participation program that provides
                financing secured by deeds of trust or mortgages on real
                property.

            

      

      	D.  	
              VESTIN
                is a duly formed Nevada corporation, and is responsible for the daily
                operations of VRM I and VRM H and is the Manager of VF
                Ill.

            

      

      	E.  	
              Originations
                is a licensed Mortgage Broker that arranges loans for the benefit
                of VRM
                I, VRM II, VF III and other commercial real estate
                lenders.

            

      

      	D.  	
              Owens
                Mortgage Investment Fund is a SEC registered public partnership that
                provides financing and owns notes secured by deeds of trust or mortgages
                on real property.

            

      

      	F.  	
              Owens
                Financial is the General Partner of Owens Mortgage Investment
                Fund.

            

      

      	G.  	
              Owens
                Financial and Owens Mortgage Investment Fund have agreed to fund
                a
                $20,000,000.00 portion of a $31,250,000.00 loan to Cliff Shadows
                Properties, LLC, a Nevada limited liability company, a loan originated
                by
                Originations.

            

      

      	H.  	
              The
                Lead Lenders and Lenders enter into this Agreement to, among other
                things,
                further define their respective rights, duties, authorities and
                responsibilities regarding their proposed shared interests in the
                and to
                define the priority of payment for all of the proceeds from the assigned
                participation in the loan.

            

      

      

      NOW
        THEREFORE, for good and valuable consideration, the receipt and sufficiency
        of
        which is hereby acknowledged, and based upon the foregoing Recitals which
        are an
        integral part of this Agreement, as well as the mutual covenants and promises
        contained herein, Originations, Vestin, VRM 1, VRM II, VF III, Owens Financial,
        and Owens Mortgage Investment Fund hereby agree as follows:

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      SECTION
        1. DEFINITIONS

      

      Section
        1.1. Definitions.
        All
        capitalized terms used in this Agreement shall have the meanings assigned
        to
        them below in this Section 1 or in the provisions of this Agreement referred
        to
        below:

      

      “Agreement”
        shall mean this lntercreditor Agreement as amended, modified or restated
        in
        accordance with the terms hereof.

      

      “Assignment”
        shall mean the actual recorded assignment of a specific percentage interest
        in a
“Loan”.

      

      “Bankruptcy
        Proceeding” shall mean, with respect to any Person, a general assignment by such
        Person for the benefit of its creditors, or the institution by or against
        such
        Person of any proceeding seeking its relief as debtor, or seeking to adjudicate
        such Person as bankrupt or insolvent, or seeking reorganization, arrangement,
        adjustment or composition of such Person or its debts, under any law relating
        to
        bankruptcy, insolvency, reorganization or relief of debtors, or seeking
        appointment of a receiver, trustee, custodian or other similar official for
        such
        Person or for any substantial part of its property.

      

      “Borrowers”
        shall mean any person or entity that obligates itself or its property as
        security for a “Loan”.

      

      “Collateral”
        shall mean all the real and personal property collateral under the Loan
        Documents.

      

      “Default”
        shall mean any event or condition, the occurrence of which would, with the
        lapse
        of time or the giving of notice, or both, pursuant, to the “Loan Documents”
constitute an Event of Default.

      

      “Interest
        Rate” shall mean the rate of interest paid to Owens Financial or Owens Mortgage
        Investment Fund for their “Participation Interest” in the “Loan”. This rate
        shall be a fixed rate of Eleven Percent (11.0%) for the duration of the
        Loan.

      

      “Late
        Charges” shall mean the late charges and or default rate charged to Borrowers in
        the event of default or late payments under the “Loan Documents”.

      

      “Lead
        Lender and Lead Lenders” shall mean Originations, Vestin, VRM I, VRM II, VF Ill
        or any successor lead lender.

      

      “Lender
        and Lenders” shall mean Owens Financial or Owens Mortgage Investment Fund or
        their assignee.

      

      “Loan
        Documents” shall mean of all the various notes, deeds of trusts, guarantees,
        title policies, security agreements, loan agreements, assignment of rents
        and
        profits, and whatever documents are in existence to protect and secure the
        repayment of the Borrowers obligations under the note.

      

      “Loan”
        shall mean the note, and all of the documents and agreements that evidence
        and
        secure the debt of the “Borrowers”.

      

      “Priority
        of Payment” shall mean the order in which payments are made to the

      

      “Lead
        Lender” and to the “Lender”.

      

      “Participation
        Interest” shall signify amount in dollars of the “Assignment” owned by Owens
        Financial and Owens Mortgage Investment Fund in the “Loan”.

      

      1.2
        Effectiveness of this Agreement
        The
        effectiveness of this Agreement is conditioned upon (a) the execution and
        delivery of this Agreement by the Lead Lenders and the Lenders, (b) the
        execution, delivery and effectiveness of the Loan Documents by the Lead Lenders,
        and the payment of the Participation Interest by Lenders to the Lead
        Lenders.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      SECTION
        2. RELATIONSHIP AMONG LENDERS

      

      2.1
        Restrictions
        on Actions.
        Lead
        Lenders agree that, so long as any portion of a Loan is outstanding or unpaid
        they shall, for the benefit of Lenders, except as permitted under this
        Agreement:

      

      	(a)  	
              Notify
                Lenders before taking or filing any action, judicial or otherwise,
                to
                enforce any rights or pursue any remedy under the Loan Documents,
                except
                for delivering notices hereunder.

            

      

      	(b)  	
              Refrain
                from (1) selling any portion of the Loan to the Borrowers or any
                affiliate
                of the Borrowers and (2) accepting any substitute guaranty or any
                other
                security for, the Loan from the Borrowers or any Affiliate of the
                Borrowers, without Lenders consent. In the event Lender refuses to
                consent
                to such requested action, Lead Lenders shall be entitled to either
                repurchase Lenders Participation Interest for the amount of principal
                and
                accrued interest outstanding or offer the Lenders a Substitution
                of
                Security.

            

      

      2.2
        Representations and Warranties.
        Lead
        Lenders and Lenders represent and warrant to each other that:

      

      (a)  It
        (1)
        is
        a
        legal entity duly organized, existing and in good standing under the laws
        and
        governmental authority of the jurisdiction of its domicile, and (ii) has
        all
        requisite corporate power to own its property and conduct its business as
        now
        conducted and as presently contemplated.

      

      (b)  The
        execution, delivery and performance by such Lead Lenders or Lenders of this
        Agreement has been authorized by all necessary proceedings (corporate or
        otherwise) and does not and will not contravene any provision of law, its
        charter or by-laws or operating agreement or any amendment thereof, or of
        any
        indenture, agreement, instrument or undertaking binding upon such Lead Lenders
        or Lenders.

      

      (c)  The
        execution, delivery and performance by such Lead Lenders or Lenders of this
        Agreement will result in a valid and legally binding obligation of such Lead
        Lenders or Lenders enforceable in accordance with its terms, subject to
        bankruptcy, insolvency, fraudulent conveyance and similar laws affecting
        creditors’ rights generally, and general principles of equity (regardless of
        whether the application of such principles is considered in a proceeding
        in
        equity or at law).

      

      (d)  It
        has
        received and approved, as to form and content, sample copies of the Loan
        Documents and Assignments, however, such approval shall not operate as a
        warranty or representation of the adequacy, validity or binding effect of
        any of
        the Loan Documents or Assignments.

      

      2.3
        Cooperation:
        Accountings.
        Lead
        Lenders will, upon the reasonable request of Lenders, from time to time execute
        and deliver or cause to be executed and delivered in a timely fashion such
        further instruments, and do and cause to be done such further acts as may
        be
        necessary or proper to carry out more effectively the provisions of this
        Agreement The Lead Lenders agree to provide to Lenders upon reasonable request,
        but in no event more frequently than once a month, a statement of all payments
        received in respect of the Loan.

      

      2.4
        Reliance
        on Lead Lenders.
        The
        Lead Lenders shall promptly provide to Lenders a copy of all financial
        statements and reports of operating results and other documents and information
        received by the Lead Lenders in its capacity as such pursuant to the Loan
        Documents. The Lead Lenders shall have a duty and responsibility to provide
        Lenders with any credit or other information concerning the affairs, financial
        condition or business of the Borrowers which may come into the possession
        of the
        Lead Lenders, including financial statements, credit reports and any other
        documents and information.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      2.5 Limitation
        on Lead Lender’s Liability.

      

      (a)  In
        addition to the Lead Lender’s failure to comply with the terms of this
        Agreement, including the Priority of Payment, the Lenders shall have full
        recourse against Lead Lenders for the amounts payable by the terms of this
        agreement. Lead Lenders obligation with respect to such payments shall be
        to
        remit to the Lenders a monthly payment based on the agreed Interest Rate
        calculated on the Participation Interest and the principal amount of the
        Participation interest when a Loan pays off or matures in accordance with
        this
        Agreement.

      

      (b)  Although
        Lead Lenders will exercise the same care in administering the Loan as if
        the
        Loan were made entirely for Lead Lenders’ own account, Lead Lenders liability
        shall be limited to the Lenders Participation Interest and the amount payable
        on
        that at the Interest Rate, except for a loss due to Lead Lenders’ own gross
        negligence, willful acts or misconduct

      

      (c)  Lead
        Lenders shall be entitled to rely upon any certification, notice or other
        communication (including any thereof by telephone, telex, telegram, cable
        or
        telecopy) believed by it to be genuine and correct and to have been signed
        or
        sent by or on behalf of the Lenders. Should approval of any action, any inaction
        or any proposed course of conduct in administering the Loan (either before
        or
        after the occurrence of an Event of Default) be requested in writing by the
        Lead
        Lenders from Lenders, such Lenders shall approve or deny such request in
        writing
        and shall deliver the writing to the Lead Lenders within ten (10) calendar
        days
        after the Lenders’ receipt of the Lead Lender’s request. Any Lenders’ failure to
        respond within the ten (10) calendar days shall be deemed consent by such
        Lender
        to such request

      

      (d)  Lead
        Lenders do not assume and shall have no responsibility or liability, express
        or
        implied, for (i) the collectibility of the Loan made to Borrowers under,
        or the
        enforceability of, any of the Loan Documents, or (ii) the financial condition
        or
        creditworthiness of the Borrowers, or (iii) any credit or other information
        furnished by the Borrowers to Lead Lenders, or (iv) the value of any collateral
        for the Loan.

      

      2.6
        Lead
        Lender Rights as Lender.
        The
        Lead Lender in its capacity as a lender hereunder shall have the same rights,
        powers and obligations hereunder as all ‘other Lenders and may exercise the same
        as though it were not acting as the Lead Lender.

      

      SECTION
        3. ADMINISTRATION OF LOAN

      

      3.1
        Administration
        and Servicing of Loan.
        In
        administering and servicing the Loan, Lead Lenders shall act in its own behalf
        as to its interest in the Loan and shall act as an independent contractor
        (and
        not as an agent or trustee) for the Lenders with respect to their respective
        interests in the Loan. The Lenders hereby appoint and authorize Lead Lenders
        to
        act for and on behalf of the Lenders with regard to the Loan, subject to
        the
        restrictions set forth in this Agreement Lead Lenders shall utilize its own
        facilities and equipment and its own employees and other persons authorized
        under the Loan Documents in the administering and servicing of the Loans,
        all
        without cost to the Lenders.

      

      In
        its
        administering and servicing of the Loan, Lead Lenders shall

      perform
        the following duties (the enumeration of said duties not being intended to
        limit
        the duties to be performed by Lead Lenders in accordance with the foregoing
        paragraph) and shall be subject to the following restrictions and shall have
        the
        following rights:

      

      (a)  Possession
        of Loan
        Documents.
        For the
        benefit of the Lenders, Lead Lenders shall hold in its possession at its
        principal office executed originals of all the Loan Documents for each Loan
        assigned and shall deliver conformed copies of each thereof to the
        Lenders.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      (b)  Expenses/Losses.
        In the
        event that any reasonable legal expenses or other expenses for the preservation
        of the collateral for the Loan or for the enforcement of the Loan are incurred
        by Lead Lenders in connection with the Loan or on or after or in connection
        with
        the occurrence of an Event of Default or the enforcement of any of the Loan
        Documents (including fees of counsel and other expenses), Lead Lenders shall
        bear and advance all such costs. Upon receipt of reimbursement for such expenses
        from Borrowers or any other person, Lead Lenders shall be entitled to retain
        such reimbursement

      

      (c)  Collections.
        Lead
        Lenders shall use reasonable efforts to collect all payments of principal,
        interest and fees due from the Borrowers under the Loan Documents and shall
        remit to the Lenders on a monthly basis a payment calculated at the agreed
        Interest Rate based on the outstanding balance of the Participation Interest.
        The Lenders shall have the right to an accounting for all monies received
        by
        Lead Lenders in connection with each Loan that has a Participation Interest
        by
        Lenders.

      

      (d)  Payment Returns.
        If any
        payment received by Lead Lenders and distributed or credited to the Lenders
        is
        later rescinded or is otherwise required to be returned by Lead Lenders to
        the
        Borrowers for whatever reason (including, without limitation, settlement
        of an
        alleged claim), the Lenders shall be entitled to retain any payment received.
        The covenant contained in this paragraph shall survive the termination of
        this
        Agreement.

      

      (e)  Records.
        Lead
        Lenders shall maintain such books and records relating to the Loan as it
        would
        were the Loan made solely by Lead Lenders, which books and records shall
        be made
        available to the Lenders at Lead Lender’s main branch in Las Vegas, Nevada at
        all reasonable times for purposes of inspection, examination and audit upon
        no
        less than forty-eight (48) hours prior notice.

      

      (f)  Information.
        During
        the term of this Agreement, Lead Lenders shall provide to the Lenders complete
        and current information as to the accrual status of the Loan and the status
        of
        principal and interest payments, and all information supplied by Borrowers
        in
        connection with the Loan. The Lenders will treat all such information as
        confidential, except that disclosure thereof may be made if required by law
        or
        the order of a court having jurisdiction.

      

      (g)  Administrative Decisions.
        Lead
        Lenders shall not, without written consent of Lenders, (1) release, or agree
        to
        the substitution of other security for any portion of the Real Property,
        Leasehold Rights and/or Collateral securing the Loans, (2) grant any release
        in
        favor of the Borrowers under the Loan Documents, or waive the Lenders’ rights to
        enforce the obligations of the Borrowers, (3) agree to the revision,
        modification or amendment of any of the Loan Documents, or (4) consent to
        or
        accept the cancellation or termination of any of the Loan Documents, except
        upon
        payment in full of each Loan. Subject to the foregoing limitations, and until
        the occurrence and declaration of an Event of Default under the Loan Documents
        and Borrowers failure to cure within twenty (20) days, Lead Lenders shall
        have
        the right to make decisions in connection with the day-to-day administration
        and
        servicing of the Loan, relating to inspections, review of financial data,
        and
        other matters of an ordinary nature involved in the administration and servicing
        of the Loan, without the Lenders’ prior review or approval.

      

      (h)  Reasonable Efforts.
        If any
        Event of Default shall occur under any of the Loans, Lead Lenders shall use
        reasonable efforts in accordance with the Loan Documents to cause the Borrowers,
        Guarantors and/or Limited Guarantors to remedy the default

      

      (i)  Hazard
        Insurance and Condemnation Awards.
        If Lead
        Lenders becomes aware of any damage to or actual or potential condemnation
        affecting any material portion of the Real Property, Leasehold Rights and/or
        Collateral securing the Loans, Lead Lenders will promptly notify Lenders
        thereof. The proceeds of any insurance recovery or condemnation award received
        by Lead Lenders and not immediately disbursed or applied to the repayment
        of the
        Loan or not otherwise distributed by Lead Lenders shall be deposited in an
        interest-bearing account, in trust for all lenders, and the income, if any,
        received by Lead Lenders from such account and not payable to others shall
        be
        shared with the Lenders in accordance with terms of this Agreement.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      3.2 Payment
        Priorities Between Lead Lenders and Lenders.

      

      (a)  Lead
        Lenders and Lenders agree that all payment and/or prepayment of principal
        due on
        the Loan, received by the Lead Lenders, shall be for held for the account
        of the
        Lenders and Lead Lenders as their respective interests may appear, and such
        payment shall be applied in the following order of priority: (I) first to
        the
        payment of that portion of principal of the Loan provided by Owens Financial
        and
        Owens Mortgage Investment Fund (ii) next to pay any accrued or outstanding
        interest due Lenders at the agreed Interest Rate (iii) next to that portion
        of
        the principal of the Loan provided by Originations, VRM I, VRM II and VF
        Ill. In
        the event of default under the Loan Documents: (I) Originations, VRM I, VRM
        II
        and VF Ill agree to purchase the Participation Interest of Owens Financial
        and
        Owens Mortgage Investment Fund for the outstanding balance of that Participation
        Interest plus any accrued interest; and (ii) Originations, VRM I, VRM Il
        and VF
        Ill shall not be entitled to receive any payment of their Pro Rata Share
        of the
        principal of the Loan in question until Owens Financial and Owens Mortgage
        Investment Fund has received payment of its Participation Interest of the
        principal of the Loan and all accrued interest, late charges, default interest,
        and any other charges payable to Lenders under this Agreement.

      

      (b)  Each
        payment of interest on the Loan, received by the Lead Lender, shall be for
        the
        account of the Lenders and Lead Lenders as their respective interests may
        appear, and such payment shall be applied first to the payment of agreed
        Interest Rate due on the Participation Interest of the Loan assigned to Owens
        Financial or Owens Mortgage Investment Fund for such period that the interest
        is
        due.

      

      (c)  As
        an
        example, assume Lenders fund a 64.0% Participation Interest in a $31,250,000.00
        Loan. The Loan carries an interest rate of 12.0% and pays monthly interest
        only
        payments. Lenders and Lead Lenders would receive the following, provided
        however, that any reduction of the principal balance of the Loan through
        partial
        payoffs shall reduce proportionately the amounts shown in the examples
        below.

      

      Example
        1:
        Borrowers make a monthly payment of $312,500.00. Lenders are paid their full
        share of interest at 11.0% on $20,000,000.00 or $183,333.33. Lead Lenders
        receive $129,166.67
        or
        the
        balance of the interest paid.

      

      Example
        2:
        Borrowers make a monthly payment of $250,000.00. Lenders are paid their full
        share of interest at 11.0% on $20,000,000.00 or $183,333.33. Lead Lenders
        receive $66,666.67, or the balance of the interest paid.

      

      Example 3:
        Borrowers do not make a monthly payment, default, declare bankruptcy or withhold
        payments for any reason then, Lead Lenders pay to Lenders the full share
        of
        interest at 11.0% on $20,000,000.00 or $183,333.33. At this point Lead Lender
        may buy Lender out of the loan for $20,000,000.00, plus any accrued
        interest.

      

      Example 4:
        Borrowers payoff a portion of the Loan. Lenders are paid their Pro Rata Share
        of
        the principal balance of the Participation Interest and interest due under
        the
        terms of the Loan to the date of the partial payoff.

      

      Example
        5:
        Borrowers pay off the Loan. Lenders are paid their full Pro Rata Share of
        the
        Loan equal to their Participation Interest plus unpaid interest due under
        the
        terms of the Loan.

      

      3.3
        Defaults
        Under Loan Documents; Enforcement of Remedies.
        If
        foreclosure or similar proceedings are commenced under the Loan Documents,
        Lead
        Lenders shall buy out the Participation Interest of Owens Financial or Owens
        Mortgage Investment Fund at the sole an absolute discretion of
        Lenders.

      

      3.4
        Notices
        under Collateral
        Documents.
        Lead
        Lenders shall deliver to the Lenders, promptly upon receipt thereof, duplicates
        or copies of all notices, requests and other instruments received by it from
        any
        other party under or pursuant to any of the Loan Documents, if not previously
        furnished to the Lenders.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      SECTION
        4. RESIGNATION OR REMOVAL OF LEAD LENDER

      

      Lead
        Lenders will repurchase the Participation Interests of Lenders at Lenders
        sole
        and absolute discretion at any time “for cause”. The term “for cause” shall be
        limited to Lead Lenders’ (i) material breach of the terms of this Agreement, or
        (ii) fraud committed against Borrowers or Lenders, or (iii) criminal acts
        committed against Borrowers or Lenders. Upon any such removal, the Lenders
        shall
        have the right to appoint a successor Lead Lender.

      

      SECTION
        5. TERMINATION OF AGREEMENT

      

      Upon
        final payment in full of the Loan or all obligations owing to Lenders, such
        Lenders shall cease to be a party to this Agreement; provided, however, if
        all
        or any part of any payments to such Lenders are invalidated or set aside
        or
        required to be repaid to any Person in any Bankruptcy Proceeding or otherwise,
        then this Agreement shall be renewed as of such date and shall thereafter
        continue in full force and effect to the extent of the Loan so invalidated,
        set
        aside or repaid. If any portion of this agreement is declared to be invalid
        or
        unenforceable then the remaining portions of the Agreement shall remain in
        full
        force and effect.

      

      SECTION
        6. INDEMNIFICATION OF LENDER

      

      Originations,
        Vestin, VRM I, VRM II and VF III indemnifies Owens Financial and Owens
        Mortgage Investment Fund for all liabilities, obligations, losses, damages,
        penalties, actions, judgments, suits, costs, expenses or disbursements of
        any
        kind or nature whatsoever which may be imposed on, incurred by or asserted
        against them in any way relating to or arising out of this Agreement or by
        their
        participation in any Loan or by any action brought by any Borrower including
        all
        claims relating to the origination of the Loans, except for the gross negligence
        or willful misconduct of Lenders or the breach by Lenders of the terms of
        this
        Agreement.

      

      SECTION
        7. NOT A JOINT VENTURE

      

      Neither
        the execution of this Agreement nor the Lenders’ several ownership of interests
        in Loans, nor any agreement to share in profits or losses arising as a result
        of
        the Loans, is intended to be, nor shall it be construed to be: (a) the formation
        of a partnership or joint venture between the Lead Lenders and Lenders, or
        (b)
        the creation of a loan transaction between the Lead Lenders, as lender, and
        Lender, as borrower. Vestin Mortgage, in its capacity as Lead Lender, shall
        not
        be deemed to be a trustee for the Lenders in connection with the Loans or
        their
        interests therein. Vestin Mortgage, in its capacity as Lead Lender, shall
        owe to
        the Lenders no duty except as specifically set forth in this Agreement, and
        no
        lender shall be liable to any other person for the liability of any other
        lender
        arising in connection with the Loans or any transaction related to the Loans,
        except as may be expressly set forth in this Agreement

      

      SECTION
        8. MISCELLANEOUS

      

      8.1
        Amendment
        Neither
        this Agreement nor any provision hereof may be amended, waived, discharged
        or
        terminated orally, but only by an instrument in writing signed by all parties
        hereto.

      

      8.2
        Heading.
        The
        headings in this Agreement are for convenience of reference only and shall
        not
        define or limit the provisions hereof.

      

      8.3
        Applicable Law.
        This
        Agreement shall be construed in accordance with and governed by the laws
        of the
        State of Nevada.

      

      8.4
        Parties
        in Interest; Decisions by Majority Lenders.
        All of
        the terms, covenants and conditions contained in this Agreement shall inure
        to
        the benefit of and be binding upon the parties hereto and their permitted
        successors and assigns. There shall be no third-party beneficiaries of this
        Agreement.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      8.5
        Further Sale,
        Pledge, etc.
        Lead
        Lender may not sell, pledge, assign or otherwise transfer all or any part
        of its
        interest in any Loan without the prior written consent of Lenders, which
        consent
        shall not be unreasonably withheld. In the event all or any part of Lead
        Lenders
        interest in any Loan is sold, pledged, assigned or otherwise transferred,
        Lead
        Lenders obligations under this Agreement will not be relieved.

      

      8.6
        Notices.
        Notices
        under this Agreement shall be in writing and personally delivered or sent
        by
        certified or registered U.S. mail, or a recognized air courier service, return
        receipt requested, or by telecopy, acknowledgment of receipt requested, to
        the
        parties at their addresses specified in the first paragraph of this Agreement
        Such addresses may be changed from time to time by the addressee by serving
        notice as provided above.

      

      8.7
        Counterpart
        Execution.
        This
        Agreement may be executed in any number of counterparts with the same effect
        as
        if all parties had signed the same document. All counterparts shall be construed
        together and shall constitute one agreement

      

      8.8
        Attorney’s
        Clause.
        If
        legal action is instituted to enforce the terms of this Agreement, the
        prevailing parties shall be entitled to recover from the losing parties,
        all
        costs of collection and enforcement, including reasonable attorney’s fees. For
        purposes of this section, the award and recovery of attorney’s fees shall
        survive the entry of any judgment thereon and shall include, without limitation,
        fees incurred in the following: (1) Post Judgment Motions; (2) Contempt
        Proceedings; (3) Garnishment, levy, debtor and third party examinations;
        (4)
        Discovery; (5) Bankruptcy proceedings or other litigation; and (6)
        appeals.

      

      8.9
        Loan
        Fees, Extension Fees, Late Charges. Default Interest, Etc.
        At the
        close of escrow, Lead Lender and/or Lead Lenders shall pay to Owens Financial,
        a
        loan fee of $400,000.00 (2.0% of the face amount of the Note). In addition,
        if
        Lender and/or Lenders have not been paid in full by December 31, 2006, then
        Lead
        Lender and/or Lead Lenders shall pay to Owens Financial art additional loan
        fee
        equal to 1% of the outstanding principal balance of Lender’s/Lenders’
Participation Interest in the Joan. Furthermore, Owens Mortgage Investment
        Fund
        and/or Owens Financial Group shall be entitled to their pro rate share of
        any
        extension fees, late charges, interest on advances, default interest, etc.
        collected by Lead Lender and/or Lead Lenders under the terms of the
        Note.

      

      (END
        OF
        TEXT, CONTINUED ON NEXT PAGE]

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      IN
        WITNESS WHEREOF, the Lenders have caused this instrument to be duly executed
        as
        of the day and year first above written.

      

      
        	
                VESTIN
                  ORIGINATIONS, INC.,

              	 	
                VESTIN
                  MORTGAGE, INC.,

              
	
                a
                  Nevada corporation

              	 	
                a
                  Nevada corporation

              
	
                By:

              	 	 	
                By:

              	 
	 	
                Michael
                  V. Shustek

              	 	 	
                Michael
                  V. Shustek

              
	 	
                President

              	 	 	
                President

              
	 	 	 	 	 
	
                VESTIN
                  FUND I, LLC

              	 	
                VESTIN
                  FUND II, LLC

              
	
                a
                  Nevada corporation

              	 	
                a
                  Nevada corporation

              
	
                By:

              	
                Vestin
                  Mortgage, Inc.,

              	 	
                By:

              	
                Vestin
                  Mortgage, Inc.,

              
	 	
                a
                  Nevada corporation, Manager

              	 	 	
                a
                  Nevada corporation, Manager

              
	 	 	 	 	 
	
                By:

              	 	 	
                By:

              	 
	 	
                Michael
                  V. Shustek

              	 	 	
                Michael
                  V. Shustek

              
	 	
                President

              	 	 	
                President

              
	 	 	 	 	 
	 	 	 	 	 
	
                OWENS
                  FINANCIAL GROUP, INC.,

              	 	 	 
	
                a
                  California corporation

              	 	 	 
	 	 	 	 	 
	
                By:

              	 	 	 	 
	 	
                William
                  E. Dutra

              	 	 	 
	 	
                Senior
                  Vice President

              	 	 	 
	 	 	 	 	 
	
                OWENS
                  MORTGAGE INVESTMENTS FUND,

              	 	 	 
	
                a
                  California Limited Partnership

              	 	 	 
	 	 	 	 	 
	
                By:

              	
                Owens
                  Financial Group, Inc.

              	 	 	 
	 	
                William
                  E. Dutra, 

              	 	 	 
	 	
                Senior
                  Vice President

              	 	 	 
	 	 	 	 	 
	
                By:

              	 	 	 	 
	 	
                William
                  E. Dutra,

              	 	 	 
	 	
                Senior
                  Vice PresidentEXHIBIT 4.1

SPECIMEN STOCK CERTIFICATE

Document is copied.

NUMBER SHARES

Vital Products, Inc.

INCORPORATED UNDER THE LAWS OF DELAWARE

SEE REVERSE FOR
CERTAIN DEFINITIONS

COMMON STOCK CUSIP

[SPECIMEN]
[NOT NEGOTIABLE]

This Certifies That:

is owner of:

FULLY PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK OF $.0001PAR VALUE EACH OF

Vital Products, Inc.

transferrable on the books of the Corporation in person or by attorney upon
surrender of this certificate duly endorsed or assigned. This certificate and
the shares represented hereby are subject to the laws of the State of Delaware,
and to the Certificate of Incorporation and Bylaws of the Corporation, as now
or hereafter amended. This Certificate is not valid until countersigned by the
Transfer Agent.

WITNESS the facsimile seal of the Corporation and the facsimile
signatures of its duly authorized officers.

DATED:

COUNTERSIGNED:
INTERNATIONAL REGISTRAR AND TRANSFER AGENCY, INC.
P.O. BOX 62405, BOULDER CITY, NV 89006
TRANSFER AGENT

BY:

AUTHORIZED SIGNATURE

[CORPORATE SEAL]

/s/ Jeffrey Levine                              /s/ Michael Levine
SECRETARY                                       PRESIDENT

<PAGE>

The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common          UNIF GIFT MIN ACT - Custodian
TEN ENT - as tenants by the entireties          (Cust) (Minor)
JT TEN - as joint tenants with                  under Uniform Gifts to Minors
right of survivorship                           Act
and not as tenants in                            -----------------
common (State)

Additional abbreviations may also be used though not in the above list.

For Value Received, ___________ hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE

--------------------------------------

-------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

Shares
-------------------------------------------------------------------------
of the stock represented by the within Certificate, and do hereby irrevocably
constitute and appoint

Attorney
-----------------------------------------------------------------------
to transfer the said stock on the books of the within named Corporation with
full power of substitution in the premises.

Dated _______________

-------------------------------------------
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST
CORRESPOND WITH THE NAME AS WRITTEN UPON THE
FACE OF THE CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION ON OR ENLARGEMENT OR ANY
CHANGE WHATSOEVER.

THE CORPORATION WILL FURNISH TO ANY STOCKHOLDER, UPON REQUEST AND WITHOUT
CHARGE, A FULL STATEMENT OF THE DESIGNATIONS, RELATIVE RIGHTS, PREFERENCES
AND LIMITATIONS OF THE SHARES OF EACH CLASS AND SERIES AUTHORIZED TO BE
ISSUED, SO FAR AS THE SAME HAVE BEEN DETERMINED, AND OF THE AUTHORITY, IF
ANY, OF THE BOARD TO DIVIDE THE SHARES INTO CLASSES OR SERIES AND TO
DETERMINE AND CHANGE THE RELATIVE RIGHTS, PREFERENCES AND LIMITATIONS OF
ANY CLASS OR SERIES. SUCH REQUEST MAY BE MADE TO THE SECRETARY OF THE
CORPORATION OR TO THE TRANSFER AGENT NAMED ON THIS CERTIFICATE.
----------------------------------------------------------------------------
THE SIGNATURE TO THE ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON
THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION ON OR
ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE GUARANTEED BY A COMMERCIAL
BANK OR TRUST COMPANY OR A MEMBER FIRM OF A NATIONAL OR REGIONAL OR OTHER
RECOGNIZED STOCK EXCHANGE IN CONFORMANCE WITH A SIGNATURE GUARANTEE MEDALLION
PROGRAM.

<PAGE>

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00111-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00111-of-00352.parquet"}]]