Document:

exhibit10-2.htm

    Exhibit 10.2

    
      

    
      March 31,
2009

      

      

      Glen C.
Terry

      President
and CEO

      Vineyard
National Bancorp

      1260
Corona Pointe Court

      Corona,
CA 92879

      

      

      Dear Mr.
Terry:

      

      This
letter agreement will memorialize the agreement of the undersigned to amend the
Letter Agreement by deleting the sixth sentence of the second paragraph thereof
in its entirety and substituting the following sentence in lieu
thereof:

       

       “Lender
agrees that receipt of the Total Payoff shall be satisfaction in full for all
Loan Liabilities, subject to the express condition that Lender receives the
Initial Payoff no later than May 22, 2009.”

       

      Except as
expressly amended herein, the terms and provisions of the Letter Agreement shall
remain in full force and effect in accordance with its original terms and
conditions.

       

           Sincerely,

       

                                           FIRST TENNESSEE BANK
NATIONAL ASSOCIATION

      

      

      

      /s/ David S.
Work                                                              

      Name:
David S. Work

      Title:
Executive Vice President

      

      

      
        
          
            
               

            

             

          

          
             

            
              

            

          

          
             

          

        

      

      

      Acknowledge
and agreed:

      

      VINEYARD
NATIONAL BANCORP

      

      

      By:  /s/ Glen
C.
Terry                                                           

      Name:
Glen C. Terry

      Title:
President and CEO

      Date:
April 1, 2009

      

      

      VINEYARD
BANCSHARES:

      

      VINEYARD
BANCSHARES, INC.

      

      

      By:  /s/
Douglas M.
Kratz                                                           

      Name:
Douglas M. Kratz

      Title:
Chairman

      Date:
March 31, 2009

      

      

      cc:           Rick
Smalley – Bank MidWest

      Dave Dawson – First
Tennesseeexhbit10-1.htm

    

      MODIFICATION
TO CREDIT AGREEMENT

       

      

       

      This
Modification to Credit Agreement ("Modification") is made as of March 27, 2009,
by and among OWENS MORTGAGE
INVESTMENT FUND, a California limited partnership (“Borrower”) and CALIFORNIA BANK & TRUST, FIRST
BANK and CITY NATIONAL
BANK (which are collectively known as “Lenders”).

       

      RECITALS

       

      A.           Pursuant
to the terms of a Credit Agreement ("Credit Agreement") between Lenders and
Borrower dated as of August 31, 2001, Lenders agreed to make Revolving Loans to
Borrower up to the credit limit of the principal sum of
$20,000,000.  California Bank & Trust is the agent of Lenders
under the Credit Agreement (“Agent”).  The Credit Agreement was
amended by a Modification to Credit Agreement, dated February 28, 2002, executed
by the parties that, among other things, added Swing Loans to the
facility.  The Revolving Loans and Swing Loans are collectively
referred to as “Loans.”  By a Modification to Credit Agreement, dated
August 16, 2002, executed by the parties, the “Amount of Aggregate Commitment”
for each Lender was increased.  By a Modification to Credit Agreement
dated July 31, 2003, executed by the parties, the “Commitment Termination Date”
was extended to July 31, 2005.  By a further Modification to Credit
Agreement dated July 31, 2005, the “Commitment Termination Date” was extended to
September 30, 2005.  By another Modification to Credit Agreement,
dated September 30, 2005, the “Commitment Termination Date” was extended to July
31, 2007.  By another Modification to Credit Agreement, dated February
9, 2006, the Amount of Aggregate Commitment for each Lender through July 31,
2006 was amended and Second Replacement Revolving Promissory Notes were
executed.  By a Modification to Credit Agreement, dated August 15,
2006, compliance with section 11.25 of the Credit Agreement as of September 30,
2006 was waived. By a further Modification to Credit Agreement, dated February
23, 2007, the “Amount of Aggregate Commitment” for Loans was temporarily
increased through July 31, 2007, provision for an Unused Commitment Fee was
added, and Third Replacement Promissory Notes were executed. By another
Modification to Credit Agreement, dated July 20, 2007, the Commitment
Termination Date was further extended.  The Credit Agreement was last
amended by a Modification to Credit Agreement, dated March 31, 2008, by which
the Amount of Aggregate Commitment was changed, the Unused Commitment Fee was
reaffirmed, and the Minimum Tangible Net Worth covenant was adjusted, among
other things. 

       

      B.           In
response to Borrower's request and in reliance upon Borrower's representations
made to Lenders in support thereof, Lenders have agreed to further modify the
terms of the Credit Agreement, as set forth in this
Modification.  Capitalized terms shall have the meanings assigned to
them in the Credit Agreement, as previously modified, except as set forth in
this Modification.

       

      AGREEMENT

       

      NOW,
THEREFORE, Borrower and Lenders agree as follows:

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      1. Adoption of
Recitals.  Borrower hereby represents and warrants that each of
the recitals set forth above is true, accurate and complete.

       

      2. Conditions
Precedent.  This Modification shall become effective only upon
Borrower's delivery or satisfaction of the following conditions in form and
substance acceptable to Agent:

       

      (a)  There
shall be no Event of Default under the Credit Agreement, except as waived
hereby;

       

      (b)    
 Borrower
shall execute this Modification;

       

      (c)  Guarantor
shall execute the Acknowledgment and Consent appended to the
Modification;

       

      (d)    
 Borrower
shall pay to Agent all of Agent’s attorneys' fees incurred in the preparation of
this Modification and all out-of-pocket fees incurred by Agent in connection
with this Modification; and

       

      (e)  Borrower
shall provide any other items or documents required by Agent in connection with
the consummation of this transaction.

       

      3. Representations and
Warranties.  Borrower hereby represents and warrants that no
event of default, breach or failure of condition has occurred or exists, or
would exist with notice or lapse of time, or both, under any of the Credit
Documents, and all representations and warranties of Borrower in this
Modification and the other Credit Documents are true and correct as of the date
of this Modification and shall survive the execution of this
Modification.

       

      4. Waivers.   Borrower’s
compliance with positive net profit and positive operating profit requirements
of Section 11.9 of the Credit Agreement, entitled “Profitability,” are waived
for the periods ending December 31, 2008 and March 31, 2009.

       

      5. Modification of Loan
Documents.  The Credit Documents are hereby supplemented,
amended and modified to incorporate the following, which shall supersede and
prevail over any existing and conflicting provisions thereof:

       

      (a)       Section
5.1 of the Credit Agreement, entitled “Interest,” is modified by deleting
subsection (a) thereof and replacing subsection (a) with the
following:

       

                 
(a)  Loans.   The
unpaid principal amount of each Loan shall bear interest prior to maturity at a
rate per annum equal to the Reference Rate in effect from time to time but in no
event shall interest accrue at less than five

                                                   percent
(5.00%) per annum.

                                                    

      6. Security
Instruments.  The Credit Documents which recite that they are
security instruments shall secure, in addition to any other obligations secured
thereby, the payment and performance by Borrower of all obligations under the
Credit Documents, as modified hereby, and any amendments, modifications,
extensions or renewals of the same which are hereafter agreed to in writing by
the parties.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      7. Governing
Law.  This Modification shall be construed, governed and
enforced in accordance with the laws of the State of California.

       

      8. Interpretation.  No
provision of this Modification is to be interpreted for or against either
Borrower or Lenders because that party, or that party's representative, drafted
such provision.

       

      9. Full Force and
Effect.  Except as set forth herein, all other terms and
conditions of the Loan Documents shall remain in full force and
effect.

       

      10. Reaffirmation.  Borrower
hereby acknowledges, reaffirms and confirms its obligations under the Credit
Documents, as amended and modified by this Modification.

       

      11. Entire
Agreement.  This Modification and the Credit Documents
represent the entire agreement of the parties and supersede all prior oral and
written communication between the parties.  If there is any conflict
between this Modification and any documents referred to herein, this
Modification shall prevail.  No amendment of this Modification shall
be valid unless it is in writing and is signed by the parties to this
Modification.

       

      12. IN
WITNESS WHEREOF, the parties have executed this Modification as of the day and
year first above written.

       

      

      

      OWENS MORTGAGE INVESTMENT
FUND,

      a
California limited partnership,

      

      By:           OWENS FINANCIAL GROUP,
INC.,

      a California corporation, its general
partner

      

      

      By:           /s/ Bryan H.
Draper

      Name:      Bryan H.
Draper

      Title:        CFO

      

      2221 Olympic Boulevard

      Walnut Creek, CA 94595

      Fax: (925)
935-1486

      
        
          
            {Clients\cbt-ln\0091\agr\07006300.DOC}
                                                                    

          

           

        

        
          3

          
            

          

        

        
           

        

      

      CALIFORNIA BANK & TRUST, a
California

      banking
corporation

      

      

      By:           /s/ S.C.
Bellicini

      Name:      S.C.
Bellicini

      Title:        Senior Vice
President

      

      

      By:           /s/ Carmen
Sanz

      Name:      Carmen
Sanz

      Title:        Vice
President

      

      San
Francisco Corporate Banking

      465
California Street, First Floor

      San
Francisco, CA 94104

      Fax:  415/875-1456

      
        
          
            {Clients\cbt-ln\0091\agr\07006300.DOC}
                                                                    

          

           

        

        
          4

          
            

          

        

        
           

        

      

      FIRST BANK, a Missouri banking
corporation, formerly
FIRST BANK &
TRUST

      

      

      By:           /s/ William G. Nelle,
Jr.

      Name:      William G. Nelle,
Jr.

      Title:         SVP &
Manager

      

      

      By:           

      Name:                      

      Title:                      

      

      Commercial
and Private Banking

      550
Montgomery Street

      San
Francisco, CA 94111

      Fax:  415/398-7190

      
        
          
            {Clients\cbt-ln\0091\agr\07006300.DOC}
                                                                    

          

           

        

        
          5

          
            

          

        

        
           

        

      

      CITY NATIONAL BANK, a
national

      banking
corporation

      

      

      

      By:           /s/ Kevin P.
McKenna

      Name:      Kevin P.
McKenna

      Title:        Vice
President

      

      

      By:           /s/ Jerry
McDermott

      Name:      Jerry
McDermott

      Title:        Vice
President

      

      Address:      555 South Flower Street,
16th Floor

                            Los Angeles, CA
90071

      Fax:               (213)
673-8958

      

      

      
        
          
            {Clients\cbt-ln\0091\agr\07006300.DOC}
                                                                    

          

           

        

        
          6

          
            

          

        

        
           

        

      

      ACKNOWLEDGMENT
AND CONSENT

       

      Guarantor
acknowledges and consents to the foregoing Modification to Credit Agreement and
all prior Modifications to Credit Agreement executed by Borrower and Lenders in
connection with the Credit Agreement.  Guarantor further acknowledges
that the Continuing Guaranty, dated August 31, 2001, executed by Guarantor in
favor of Agent and Lenders remains in full force and effect without known
defense as to the indebtedness of Borrower under the Credit Agreement, as
previously and as herewith modified.

       

      Dated:  March
27, 2009

       

      OWENS
FINANCIAL GROUP, INC.,

      a
California corporation

      

      

      By:        /s/ Bryan H.
Draper

      Printed
Name:   Bryan H.
Draper

      Title:     CFO

      

      

      

      

      

      ACCEPTED
AND ACKNOWLEDGED BY:

      

      CALIFORNIA
BANK & TRUST, AS AGENT FOR BANKS

      

      

      By:        /s/ Carmen
Sanz

      

      Printed
Name:   Carmen
Sanz

      

      Title:     Vice
President

      

       

       

      

       

      

      

      

      
        
          
            {Clients\cbt-ln\0091\agr\07006300.DOC}
                                                                    

          

           

        

        
          7

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