OFFICIAL RECORDS OF
MARICOPA COUNTY RECORDER
HELEN PURCELL
97-0285322 04/30/97 10:58
CHRISTIA 7 OF 9
OLD REPUBLIC TITLE AGENCY
WHEN RECORDED MAIL TO:
U. S. BANK OF WASHINGTON, National Association
1301 Fifth Avenue, 20th FI., WWW-967
P.O. Box 720
Seattle, WA 98111-0720
FOR RECORDER'S USE ONLY
[U.S. BANK LOGO]
CONSTRUCTION DEED OF TRUST
THIS DEED OF TRUST IS DATED APRIL 22, 1997, among
EMERITUS PROPERTIES VI, INC., a Washington
corporation, whose address is 3131 Elliott Ave.,
Suite 500, Seattle, WA 98121-1031 (referred to
below as "Trustor"); U. S. BANK OF WASHINGTON,
National Association, whose address is 1301 Fifth
Avenue, 20th FI., WWW-967, P.O. Box 720, Seattle,
WA 98111-0720 (referred to below sometimes as
"Lender" and sometimes as "Beneficiary"); and
UNITED STATES NATIONAL BANK OF OREGON, whose
address is P. O. Box 720, Seattle, Washington
98111-0720 (referred to below as "Trustee").
CONVEYANCE AND GRANT. For valuable consideration,
Trustor conveys to Trustee in trust, with power of
sale, for the benefit of Lender as Beneficiary,
all of Trustor's right, title, and interest in and
to the following described real property, together
with all existing or subsequently erected or
affixed buildings, improvements and fixtures; all
easements, rights of way, and appurtenances; all
water and water rights flowing through, belonging
or in anyway appertaining to the Real Property,
and all of Trustor's water rights that are
personal property under Arizona law, including
without limitation all type 2 nonirrigation
grandfathered rights (if applicable), all
irrigation rights, all ditch rights, rights to
irrigation district stock, all contracts for
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04-22-97 DEED OF TRUST Page 2
(Continued)
effluent, all contracts for Central Arizona
Project water, and all other contractual rights to
water, and together with all rights (but none of
the duties) of Trustor as declarant under any
presently recorded declaration of covenants,
conditions and restrictions affecting real
property; and all other rights, royalties, and
profits relating to the real property, including
without limitation all minerals, oil, gas,
geothermal and similar matters, located in
Maricopa County, State of Arizona (the "Real
Property"):
See Exhibit "A" attached hereto and incorporated
herein.
The Real Property or its address is commonly known
as 2935 North l8th Place, Phoenix, AZ 98121-1031.
Trustor presently assigns to Lender (also known as
Beneficiary in this Deed of Trust) all of
Trustor's right, title, and interest in and to all
present and future leases of the Property and all
Rents from the Property. In addition, Trustor
grants Lender a Uniform Commercial Code security
interest in the Rents and the Personal Property
defined below.
DEFINITIONS. The following words shall have the
following meanings when used in this Deed of
Trust. Terms not otherwise defined in this Deed of
Trust shall have the meanings attributed to such
terms in the Uniform Commercial Code. All
references to dollar amounts shall mean amounts in
lawful money of the United States of America.
BENEFICIARY. The word "Beneficiary" means U. S.
BANK OF WASHINGTON, National Association, its
successors and assigns. U. S. BANK OF WASHINGTON,
National Association also is referred to as
"Lender" in this Deed of Trust.
DEED OF TRUST. The words "Deed of Trust" mean this
Deed of Trust among Trustor, Lender, and Trustee,
and includes without limitation all assignment and
security interest provisions relating to the
Personal Property and Rents.
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04-22-97 DEED OF TRUST Page 3
(Continued)
GUARANTOR. The word "Guarantor" means and includes
without limitation any and all guarantors,
sureties, and accommodation parties in connection
with the Indebtedness.
IMPROVEMENTS. The word "Improvements" means and
includes without limitation all existing and
future improvements, buildings, structures, mobile
homes affixed on the Real Property, facilities,
additions, replacements and other construction on
the Real Property.
INDEBTEDNESS. The word "Indebtedness" means all
principal and interest payable under the Note and
any amounts expended or advanced by Lender to
discharge obligations of Trustor or expenses
incurred by Trustee or Lender to enforce
obligations of Trustor under this Deed of Trust,
together with interest on such amounts as provided
in this Deed of Trust.
LENDER. The word "Lender" means U. S. BANK OF
WASHINGTON, National Association, its successors
and assigns.
NOTE. The word "Note" means the Note dated April
22, 1997, in the original principal amount of
$3,500,000.00 from Trustor to Lender, together
with all renewals, extensions, modifications,
refinancings, and substitutions for the Note.
NOTICE TO TRUSTOR: THE NOTE CONTAINS A VARIABLE
INTEREST RATE.
PERSONAL PROPERTY. The words "Personal Property"
mean all equipment, fixtures, and other articles
of personal property now or hereafter owned by
Trustor, and now or hereafter attached or affixed
to the Real Property; together with all
accessions, parts, and additions to, all
replacements of, and all substitutions or, any of
such property; and together with all proceeds
(including without limitation all insurance
proceeds and refunds of premiums) from any sale or
other disposition of the Property.
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04-22-97 DEED OF TRUST Page 4
(Continued)
PROPERTY. The word "Property" means collectively
the Real Property and the Personal Property.
REAL PROPERTY. The words "Real Property" mean the
property, interests and rights described above in
the "Conveyance and Grant" section.
RELATED DOCUMENTS. The words "Related Documents"
mean and include without limitation all promissory
notes, credit agreements, loan agreements,
environmental agreements, guaranties, security
agreements, mortgages, deeds of trust, and all
other instruments, agreements and documents,
whether now or hereafter existing, executed in
connection with the Indebtedness.
RENTS. The word "Rents" means all present and
future rents, revenues, income, issues, royalties,
profits, and other benefits derived from the
Property.
TRUSTEE. The word "Trustee" means UNITED STATES
NATIONAL BANK OF OREGON and any substitute or
successor trustees.
TRUSTOR. The word "Trustor" means any and all
persons and entities executing this Deed of Trust,
including without limitation all Trustors named
above.
THIS DEED OF TRUST, INCLUDING THE ASSIGNMENT OF
RENTS AND THE SECURITY INTEREST IN THE RENTS AND
PERSONAL PROPERTY, IS GIVEN TO SECURE (1) PAYMENT
OF THE INDEBTEDNESS AND (2) PERFORMANCE OF ANY AND
ALL OBLIGATIONS OF TRUSTOR UNDER THE NOTE, THE
RELATED DOCUMENTS, AND THIS DEED OF TRUST. THIS
DEED OF TRUST, INCLUDING THE ASSIGNMENT OF RENTS
AND THE SECURITY INTEREST IN THE RENTS AND
PERSONAL PROPERTY, IS ALSO GIVEN TO SECURE ANY AND
ALL OBLIGATIONS OF TRUSTOR UNDER THAT CERTAIN
CONSTRUCTION LOAN AGREEMENT BETWEEN TRUSTOR AND
LENDER OF EVEN DATE HEREWITH. ANY EVENT OF DEFAULT
UNDER THE CONSTRUCTION LOAN AGREEMENT, OR ANY OF
THE RELATED DOCUMENTS REFERRED TO THEREIN, SHALL
ALSO BE AN EVENT OF DEFAULT UNDER THIS DEED OF
TRUST. THE NOTE AND THIS DEED OF TRUST ARE GIVEN
AND ACCEPTED ON THE FOLLOWING TERMS:
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04-22-97 DEED OF TRUST Page 5
(Continued)
PAYMENT AND PERFORMANCE. Except as otherwise
provided in this Deed of Trust, Trustor shall pay
to Lender all amounts secured by this Deed of
Trust as they become due, and shall strictly and
in a timely manner perform all of Trustor's
obligations under the Note, this Deed of Trust,
and the Related Documents.
POSSESSION AND MAINTENANCE OF THE PROPERTY.
Trustor agrees that Trustor's possession and use
of the Property shall be governed by the following
provisions:
POSSESSION AND USE. Until the occurrence of an
Event of Default or until Lender exercises its
right to collect Rents as provided for in the
Assignment of Rents form executed by Grantor in
connection with the Property, Trustor may a)
remain in possession and control of the
Property, (b) use, operate or manage the
Property, and (c) collect any Rents from the
Property.
DUTY TO MAINTAIN. Trustor shall maintain the
Property in tenantable condition and promptly
perform all repairs, replacements, and
maintenance necessary to preserve its value.
HAZARDOUS SUBSTANCES. The terms "hazardous
waste," "hazardous substance," "disposal,"
"release," and "threatened release,." as used
in this Deed of Trust, shall have the same
meanings as set forth in the Comprehensive
Environmental Response, Compensation and
Liability Act of 1980, as amended 42 U.S C.
Section 9601, et seq. ("CERCLA"), the Superfund
Amendments and Reauthorization Act of 1986,
Pub. L. No. 99-499 ("SARA"), the Hazardous
Materials Transportation Act, 49 U.S.C Section
1801, et seq., the Resource Conservation and
Recovery Act, 42 U.S.C. Section 6901, et seq.,
or other applicable state or Federal laws rules
or regulations adopted pursuant to any of the
foregoing. The terms "hazardous waste" and
"hazardous substance" shall also include,
without limitation, petroleum and petroleum by-
products or any fraction thereof and asbestos.
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04-22-97 DEED OF TRUST Page 6
(Continued)
Trustor represents and warrants to Lender that:
(a) During the period of Trustor's ownership of
the Property, there has been no use, generation,
manufacture, storage, treatment, disposal, release
or threatened release of any hazardous waste or
substance by any person on, under, about or from
the Property; (b) Trustor has no knowledge of, or
reason to believe that there has been, except as
previously disclosed to and acknowledged by Lender
in writing, (i)any use, generation, manufacture,
storage, treatment, disposal, release, or
threatened release of any hazardous waste or
substance on, under, about or from the Property by
any prior owners or occupants of the Property or
(ii any actual or threatened litigation or claims
of any kind by any person relating to such
matters; and (c) except as previously disclosed to
and acknowledged by Lender in writing, (i) neither
Trustor nor any tenant contractor, agent or other
authorized user of the Property shall use,
generate manufacture, store, treat, dispose of, or
release any hazardous waste or substance on under,
about or from the Property and (ii) any such
activity shall be conducted in compliance with all
applicable federal, state, and local laws,
regulations and ordinances, including without
limitation those laws regulations, and ordinances
described above. Trustor authorizes Lender and its
agents to enter upon the Property to make such
inspections and tests, at Trustor's expense, as
Lender may deem appropriate to determine
compliance of the Property with this section of
the Deed of Trust. Beneficiary, at its option, but
without obligation to do so, may correct any
condition violating any applicable environmental
law affecting the Property, and in doing so shall
conclusively be deemed to be acting reasonably and
for the purpose of protecting the value of its
collateral, and all costs of correcting a
condition or violation shall be payable to
Beneficiary by Trustor as provided in the
Expenditures by Lender section of this Deed of
Trust. Any inspections or tests made by Lender
shall be for Lender s purposes only and shall not
be construed to create any responsibility or
liability on the part of Lender to Trustor or to
any other person The representations and
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04-22-97 DEED OF TRUST Page 7
(Continued)
warranties contained herein are based on Trustor s
due diligence in investigating the Property for
hazardous waste and hazardous substances Trustor
hereby (a) releases and waives any future claims
against Lender for indemnity or contribution in
the event Trustor becomes liable for cleanup or
other costs under any such laws, and . agrees to
indemnify and hold harmless Lender against any and
all claims, losses,. liabilities, damages
penalties, and expenses which Lender may directly
or indirectly sustain or suffer resulting from a
breach of this section of the Deed of Trust or as
a consequence of any use, generation, manufacture,
storage, disposal, release or threatened release
occurring prior to Trustors ownership or interest
in the Property, whether or not the same was or
should have been known to Trustor. The provisions
of this section of the Deed of Trust, including
the obligation to indemnify, shall survive the
payment of the Indebtedness and the satisfaction
and reconveyance of the lien of this Deed of Trust
and shall not be affected by Lender's acquisition
of any interest in the Property, whether by
foreclosure or otherwise.
NUISANCE, WASTE. Trustor shall not cause, conduct
or permit any nuisance nor commit, permit, or
suffer any stripping of or waste on or to the
Property or any portion of the Property. Without
limiting the generality of the foregoing, Trustor
will not remove, or grant to any other party the
right to remove, any timber, minerals (including
oil and gas), soil, gravel or rock products
without the prior written consent of Lender.
Removal of Improvements. Trustor shall not
demolish or remove any Improvements from the Real
Property without the prior written consent of
Lender As a condition to the removal of any
Improvements, Lender may require Trustor to make
arrangements satisfactory to Lender to replace
such Improvements with Improvements of at least
equal value.
LENDER'S RIGHT TO ENTER. Lender and its agents and
representatives may enter upon the Real Property
at all reasonable times to attend to Lender s
interests and to inspect the Property for purposes
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04-22-97 DEED OF TRUST Page 8
(Continued)
of Trustor's compliance with the terms and
conditions of this Deed of Trust.
COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS. Trustor
shall promptly comply with all laws, ordinances
and regulations, now or hereafter in effect, of
all governmental authorities applicable to the use
or occupancy of the Property, including without
limitation, the Americans With Disabilities Act.
Trustor may contest in good faith any such law,
ordinance, or regulation and withhold compliance
during any proceeding, including appropriate
appeals, so long as Trustor has notified Lender in
writing prior to doing so and so long as, in
Lender s sole opinion, Lender s interests in the
Property are not jeopardized. Lender may require
Trustor to post adequate security or a surety
bond, reasonably satisfactory to Lender, to
protect Lender's interest.
DUTY TO PROTECT. Trustor agrees neither to abandon
nor leave unattended the Property. Trustor shall
do all other acts, in addition to those acts set
forth above in this section, which from the
character and use of the Property are reasonably
necessary to protect and preserve the Property.
DUE ON SALE - CONSENT BY LENDER. Lender may, at
its option, declare immediately due and payable
all sums secured by this Deed of Trust upon the
sale or transfer, without the Lender's prior
written consent, of all or any part of the Real
Property, or any interest in the Real Property. A
"sale or transfer" means the conveyance of Real
Property or any right, title or interest therein;
whether legal, beneficial or equitable; whether
voluntary or involuntary; whether by outright
sale, deed, installment sale contract, land
contract, contract for deed, leasehold interest
with a term greater than three (9) years, lease-
option contract, or by sale, assignment, or
transfer of any beneficial interest in or to any
land trust holding title to the Real Property, or
by any other method of conveyance of Real Property
interest. If any Trustor is a corporation,
partnership or limited liability company, transfer
also includes any change in ownership of more than
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04-22-97 DEED OF TRUST Page 9
(Continued)
twenty-five percent (25%) of the voting stock,
partnership interests or limited liability company
interests, as the case may be, of Trustor.
However, this option shall not be exercised by
Lender if such exercise is prohibited by federal
law or by Arizona law.
TAXES AND LIENS. The following provisions relating
to the taxes and liens on the Property are a part
of this Deed of Trust.
PAYMENT. Trustor shall pay when due (and in all
events prior to delinquency) all taxes and
assessments including without limitation sales or
use taxes in any state, local privilege or excise
taxes based on gross revenues, special taxes,
charges including water and sewer), fines and
impositions levied against Trustor or on account
of the Property, and shall pay when due all claims
for work done on or for services rendered or
material furnished to the Property Trustor shall
maintain the Property free of all liens having
priority over or equal to the interest of Lender
under this Deed of Trust, except for the lien of
taxes and assessments not due and except as
otherwise provided in this Deed of Trust.
Beneficiary shall have the right, but not the duty
or obligation, to charge Trustor for any such
taxes or assessments in advance of payment. In no
event does exercise or non-exercise by Beneficiary
of this right relieve Trustor from Trustor's
obligation under this Deed of Trust or impose any
liability whatsoever on Beneficiary.
RIGHT TO CONTEST. Trustor may withhold payment of
any tax, assessment or claim in connection with a
good faith dispute over the obligation to pay, so
long as Lender s interest in the property is not
jeopardized. If a lien arises or is filed as a
result of nonpayment, Trustor shall within fifteen
(15) days after the lien arises or if a lien is
filed, within fifteen (15) days af er Trustor has
notice of the filing, secure the discharge of the
lien, or if requested by Lender, deposit with
Lender cash or a sufficient corporate surety bond
or other security satisfactory to Lender in an
amount sufficient to discharge the lien plus any
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04-22-97 DEED OF TRUST Page 10
(Continued)
costs and attorneys' fees or other charges that
could accrue as a result of a foreclosure or sale
under the lien. In any contest, Trustor shall
defend itself and Lender and shall satisfy. Any
adverse judgment before enforcement against the
Property. Trustor shall name Lender as an
additional obligee under any surety bond furnished
in the contest proceedings.
EVIDENCE OF PAYMENT. Trustor shall upon demand
furnish to Lender satisfactory evidence of payment
of the taxes or assessments and shall authorize
the appropriate governmental official to deliver
to Lender at any time a written statement of the
taxes and assessments against the Property.
NOTICE OF CONSTRUCTION. Trustor shall notify
Lender at least fifteen (15) days before any work
is commenced, any services are furnished, or any
materials are supplied to the Property, if any
mechanic's lien materialmen's lien or other lien
could be asserted on account of the work services,
or materials. Trustor will upon request of Lender
furnish to Lender advance assurances satisfactory
to Lender that Trustor can and will pay the cost
of such improvements.
PROPERTY DAMAGE INSURANCE. The following
provisions relating to insuring the Property are a
part of this Deed of Trust.
MAINTENANCE OF INSURANCE. Trustor shall procure
and maintain policies of fire insurance with
standard extended coverage endorsements on a
replacement basis for the full insurable value
covering all Improvements on the Real Property
in an amount sufficient to avoid application of
any coinsurance clause, and with a standard
mortgagee clause in favor of Lender. Trustor
shall also procure and maintain comprehensive
general liability insurance in such coverage
amounts as Lender may request with trustee and
Lender being named as additional insureds in
such liability insurance policies. Additionally
Trustor shall maintain such other insurance,
including but not limited to hazard, business
interruption, and boiler insurance, as Lender
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04-22-97 DEED OF TRUST Page 11
(Continued)
may reasonably require Policies shall be
written in form, amounts, coverages and basis
reasonably acceptable to Lender and issued by a
company or companies reasonably acceptable to
Lender. Trustor, upon request of Lender, will
deliver to Lender from time to time the
policies or certificates of insurance in form
satisfactory to Lender, including stipulations
that coverages will not be cancelled or
diminished without at least ten (10) days'
prior written notice to Lender. Each insurance
policy also shall include an endorsement
providing that coverage in favor of Lender will
not be impaired in any way by any act, omission
or default of Trustor or any other person
Should the Real Property at any time become
located in an area designated by the Director
of the Federal Emergency Management Agency as a
special flood hazard area, Trustor agrees to
obtain and maintain Federal Flood Insurance for
the full unpaid principal balance of the loan,
up to the maximum policy limits set under the
National Flood Insurance Program, or as
otherwise required by Lender, and to maintain
such insurance for the term of the loan.
APPLICATION OF PROCEEDS. Trustor shall promptly
notify Lender of any loss or damage to the
Property if the estimated cost of replacement
or repair exceeds $1,000.00. Lender may make
proof of loss if Trustor fails to do so within
fifteen (15) days of the casualty. Whether or
not Lender's security is impaired, Lender may,
at its election, receive and retain the
proceeds of any insurance and apply the
proceeds to the reduction of the Indebtedness,
payment of any lien affecting the Property, or
the restoration and repair of the Property If
Lender elects to apply the proceeds to
restoration and repair, Trustor shall repair or
replace the damaged or destroyed Improvements
in a manner satisfactory to Lender. Lender
shall, upon satisfactory proof of such
expenditure, pay or reimburse Trustor from the
proceeds for the reasonable cost of repair or
restoration if Trustor is not in default under
this Deed of Trust. Any proceeds which have not
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04-22-97 DEED OF TRUST Page 12
(Continued)
been disbursed within 180 days after their
receipt and which Lender has not committed to
the repair or-restoration of the Property shall
be used first to pay any amount owing to Lender
under this Deed of Trust, then to pay accrued
interest, and the remainder, if any, shall be
applied to the principal balance of the
Indebtedness. If Lender holds any proceeds
after payment in full of the Indebtedness, such
proceeds shall be paid to Trustor as Trustor's
interests may appear.
UNEXPIRED INSURANCE AT SALE. Any unexpired
insurance shall inure to the benefit of, and
pass to, the purchaser of the Property covered
by this Deed of Trust at any trustee's sale or
other sale held under the provisions of this
Deed of Trust, or at any foreclosure sale of
such Property.
TRUSTOR'S REPORT ON INSURANCE. Upon request of
Lender, however not more than once a year,
Trustor shall furnish to Lender a report on
each existing policy of insurance showing: (a)
the name of the insurer; (b) the risks insured;
(c) the amount of the policy: (d the property
insured, the then current replacement value of
such property, and the manner of determining
that value; and (e) the expiration date of the
policy. Trustor shall, upon request of Lender,
have an independent appraiser satisfactory to
Lender determine the cash value replacement
cost of the Property.
TAX AND INSURANCE RESERVES Subject to any
limitations set by applicable law, Lender may
require Trustor to maintain with Lender reserves
for payment of annual taxes, assessments, and
insurance premiums, which reserves shall be
created by advance payment or monthly payments of
a sum estimated by Lender to be sufficient to
produce amounts at least equal to the taxes,
assessments, and insurance premiums to be paid.
The reserve funds shall be held by Lender as a
general deposit from Trustor, which Lender may
satisfy by payment of the taxes assessments, and
insurance premiums required to be paid by Trustor
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04-22-97 DEED OF TRUST Page 13
(Continued)
as they become due. Lender shall have the right to
draw upon the reserve funds to pay such items, and
Lender shall not be required to determine the
validity or accuracy of any item before paying it.
Nothing in the Deed of Trust shall -be construed
as requiring Lender to advance other monies for
such purposes, and Lender shall not incur any
liability for anything it may do or omit to do
with respect to the reserve account. All amounts
in the reserve account are hereby pledged to
further secure the Indebtedness, and Lender is
hereby authorized to withdraw and apply such
amounts on the Indebtedness upon the occurrence of
an Event of Default. Lender shall not be required
to pay any interest or earnings on the reserve
funds unless required by law or agreed to by
Lender in writing Lender does not hold the reserve
funds in trust for Trustor, and Lender is not
Trustor s agent for payment of the taxes and
assessments required to be paid by Trustor.
EXPENDITURES BY LENDER. If Trustor fails to comply
with any provision of this Deed of Trust, or if
any action or proceeding is commenced that would
materially affect Lender s interests in the
Property, Lender on Trustor's behalf may but shall
not be required to, take any action that Lender
deems appropriate to the extent permitted by
applicable raw. Any amount that Lender expends in
so doing will bear interest at the rate provided
for in the Note from the date incurred or paid by
Lender to the date of repayment by Trustor. All
such expenses, at Lender's option will (a) be
payable on demand, (b) be added to the balance of
the Note and be apportioned among and be payable
with any installment payments to become due during
either (i) the term of and applicable insurance
policy or (ii) the remaining term of the Note, or
(c) be treated as a balloon payment which will be
due and payable at the Note s maturity This Deed
of Trust also will secure payment of these
amounts. The rights provided for in this paragraph
shall be in addition to any other rights or any
remedies to which Lender may be entitled on
account of the default and shall be exercisable by
Lender to the extent permitted by applicable law.
Any such action by Lender shall not be construed
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04-22-97 DEED OF TRUST Page 14
(Continued)
as curing the default so as to bar Lender from any
remedy that it otherwise would have had.
WARRANTY; DEFENSE OF TITLE. The following
provisions relating to ownership of the Property
are a part of this Deed of Trust.
TITLE. Trustor warrants that: (a) Trustor holds
good and marketable title of record to the
Property in fee simple, free and clear of all
liens and encumbrances other than those set
forth in the Real Property description or in
any title insurance policy, title report, or
final title opinion issued in favor of, and
accepted by, Lender, or have otherwise been
previously disclosed to and accepted by Lender
in writing in connection with this Deed of
Trust, and (b) Trustor has the full right,
power, and authority to execute and deliver
this Deed of Trust to Lender.
DEFENSE OF TITLE. Subject to the exception in
the paragraph above, Trustor warrants and will
forever defend the title to the Property
against the lawful claims of all persons. In
the event any action or proceeding is commenced
that questions Trustor's title or the interest
of Trustee or Lender under this Deed of Trust
Trustor shall defend the action at Trustor's
expense. Trustor maybe the nominal party in
such proceeding, but Lender shall be entitled
to participate in the proceeding and to be
represented in the proceeding by counsel of
Lender's own choice, and Trustor will deliver,
or cause to be delivered, to Lender such
instruments as Lender may request from time to
time to permit such participation.
COMPLIANCE WITH LAWS. Trustor warrants that the
Property and Trustor's use of the Property
complies with all existing applicable laws,
ordinances, and regulations of governmental
authorities.
CONDEMNATION. The following provisions relating to
condemnation proceedings are a part of this
Deed of Trust.
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04-22-97 DEED OF TRUST Page 15
(Continued)
APPLICATION OF NET PROCEEDS. If all or any part
of the Property is condemned by eminent domain
proceedings or by any proceeding or purchase in
lieu of condemnation, Lender may at its
election require that all or any portion of the
net proceeds of the award be applied to the
Indebtedness or the repair or restoration of
the Property. The net proceeds of the award
shall mean the award after payment of all
reasonable costs, expenses, and attorneys fees
incurred by Trustee or Lender in connection
with the condemnation.
PROCEEDINGS. If any proceeding in condemnation
is filed, Trustor shall promptly notify Lender
in writing, and Trustor shall promptly take
such steps as may be necessary to defend the
action and obtain the award. Trustor may be the
nominal party in such proceeding, but Lender
shall be entitled to participate in the
proceeding and to be represented in the
proceeding by counsel of its own choice, and
Trustor will deliver or cause to be delivered
to Lender such instruments as may be requested
by it from time to time to permit such
participation,
IMPOSITION OF TAXES, FEES AND CHARGES BY
GOVERNMENTAL AUTHORITIES. The following provisions
relating to governmental taxes, fees and charges
are a part of this Deed of Trust:
CURRENT TAXES, FEES AND CHARGES. Upon request
by Lender, Trustor shall execute such documents
in addition to this Deed of Trust and take
whatever other action is requested by Lender to
perfect and continue Lender's lien on the Real
Property Trustor shall reimburse Lender for all
taxes, as described below, together with all
expenses incurred in recording, perfecting or
continuing this Deed of Trust, including
without limitation all taxes, fees, documentary
stamps, and other charges for recording or
registering this Deed of Trust.
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04-22-97 DEED OF TRUST Page 16
(Continued)
TAXES. The following shall constitute taxes to
which this section applies: (a) a specific tax
upon this type of Deed of Trust or upon all or
any part of the Indebtedness secured by this
Deed of Trust; (b) a specific tax on Trustor
which Trustor is authorized or required to
deduct from payments on the Indebtedness
secured by this type of Deed of Trust; (c) a
tax on this type of Deed of Trust chargeable
against the Lender or the holder of the Note;
and (d a specific tax on all or any portion of
the Inde6tedness or on payments of principal
and interest made by Trustor.
SUBSEQUENT TAXES. If any tax to which this
section applies is enacted subsequent to the
date of this Deed of Trust, this event shall
have the same effect as an Event of Default (as
defined below), and Lender ma exercise any or
all of its available remedies for an Event of
Default as provided below unless Trustor either
(a) pays the tax before it becomes delinquent,
or (b) contests the tax as provided above in
the Taxes and Liens Lender and deposits with
Lender cash or a sufficient corporate surety
bond or other security satisfactory to Lender.
SECURITY AGREEMENT; FINANCING STATEMENTS. The
following provisions relating to this Deed of
Trust as a security agreement are a part of this
Deed of Trust.
SECURITY AGREEMENT. This instrument shall
constitute a security agreement to the extent
any of the Property constitutes fixtures or
other personal property, and Lender shall have
all of the rights of a secured party under the
Uniform Commercial Code as amended from time to
time.
SECURITY INTEREST. Upon request by Lender,
Trustor shall execute financing statements and
take whatever other action is requested by
Lender to perfect and continue Lender's
security interest in the Rents and Personal
Property In addition to recording this Deed of
Trust in the real property records, Lender may,
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04-22-97 DEED OF TRUST Page 17
(Continued)
at any time and without further authorization
from Trustor, file executed counterparts,
copies or reproductions of this Deed of Trust
as a financing statement. Trustor shall
reimburse Lender for all expenses incurred in
perfecting or continuing this security
interest. Upon default, Trustor shall assemble
the Personal Property in a manner and at a
place reasonably convenient to Trustor and
Lender and make it available to Lender within
three (3) days after receipt of written demand
from Lender.
ADDRESSES. The mailing addresses of Trustor
(debtor) and Lender (secured the security
interest granted by this Deed of Trust may be
obtain e Uniform Commercial Code), are as
stated on the first page of this Deed of Trust.
FURTHER ASSURANCES; ATTORNEY-IN-FACT. The
following provisions relating to further
assurances and attorney-in-fact are a part of this
Deed of Trust.
FURTHER ASSURANCES. At any time, and from time
to time, upon request of Lender, Trustor will
make, execute and deliver, or will cause to be
made, executed or delivered, to Lender or to
Lender's designee, and when requested by
Lender, cause to be tiled, recorded, refiled,
or rerecorded, as the case may be, at such
times and in such offices and places as Lender
may deem appropriate, any and all such
mortgages, deeds of trust security deeds,
security agreements, financing statements,
continuation statements, instruments of
further, assurance, certificates, and other
documents as may, in the sole opinion of the
Lender, be necessary or desirable in order to
effectuate, complete, perfect, continue, or
preserve (a) the obligations of Trustor under
the Note this Deed of Trust, and the Related
Documents, and b the liens and security
interests created by this Deed of Trust as
first and prior liens on the Property, whether
now owned or hereafter acquired by Trustor.
Unless prohibited by law or agreed to the
==================================================
04-22-97 DEED OF TRUST Page 18
(Continued)
contrary by Lender in writing, Trustor shall
reimburse Lender for all costs and expenses
incurred in connection with the matters
referred to in this paragraph.
ATTORNEY-IN-FACT. If Trustor fails to do any of
the things referred to in the preceding
paragraph, Lender may do so for and in the name
of Trustor and at Trustor s expense. For such
purposes Trustor hereby irrevocably appoints
Lender as Trustors attorney-in-fact for the
purpose of making, executing, delivering,
filing, recording, and doing all other things
as may be necessary or desirable, in Lenders
sole opinion, to accomplish the matters
referred to in the preceding paragraph.
FULL PERFORMANCE. If Trustor pays all the
Indebtedness when due, and otherwise performs all
the obligations imposed upon Trustor under this
Deed of Trust, Lender shall execute and deliver to
Trustee a request for full reconveyance without
warranty and shall execute and deliver to Trustor
suitable statements of termination of any
financing statement on file evidencing Lender's
security interest in the Rents and the Personal
Property. Any reconveyance fee required by law
shall be paid by Trustor, if permitted by
applicable law.
DEFAULT. Each of the following, at the option of
Lender, shall constitute an event of default
("Event of Default") under this Deed of Trust:
DEFAULT ON INDEBTEDNESS. Failure of Trustor to
make any payment when due on the Indebtedness.
DEFAULT ON OTHER PAYMENTS. Failure of Trustor
within the time required by this Deed of Trust
to make any payment for taxes or insurance, or
any other payment necessary to prevent filing
of or to effect discharge of any lien.
DEFAULT IN FAVOR OF THIRD PARTIES. Should
Borrower or any Trustor default under any loan,
extension of credit, security agreement,
purchase or sales agreement, or any other
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04-22-97 DEED OF TRUST Page 19
(Continued)
agreement, in favor of any other creditor or
person that may materially affect any of
Borrower's property or Borrower's or any
Trustor's ability to repay the Loans or perform
their respective obligations under this Deed of
Trust or any of the Related Documents.
COMPLIANCE DEFAULT. Failure of Trustor to comply
with any other term, obligation, covenant or
condition contained in this Deed of Trust, the
Note or in any of the Related Documents.
FALSE STATEMENTS. Any warranty, representation
or statement made or furnished to Lender by, or
on behalf of Trustor under this Deed of Trust,
the Note or the Related Documents is false or
misleading in any material respect, either now
or at the time made or furnished.
DEFECTIVE COLLATERALIZATION. This Deed of Trust
or any of the Related Documents ceases to be in
full force and effect (including failure of any
collateral documents to create a valid and
perfected security interest or lien) at any time
and for any reason.
INSOLVENCY. The dissolution or termination of
Trustor's existence as a going business, the
insolvency of Trustor, the appointment of a
receiver for any part of Trustor's property, any
assignment for the benefit of creditors, any
type of creditor workout, or the commencement of
any proceeding under any bankruptcy or
insolvency laws by or against Trustor.
FORECLOSURE, FORFEITURE, ETC. Commencement of
foreclosure or forfeiture proceedings whether by
judicial proceeding, self-help, repossession or
any other method, by any creditor of Trustor or
by any governmental agency against any of the
Property. However, this subsection shall not
applying the event of a good faith dispute by
Trustor as to the validity or reasonableness of
the claim which is the basis of the foreclosure
or forfeiture proceeding, provided that Trustor
gives Lender written notice of such claim and
furnishes reserves or a surety bond for the
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04-22-97 DEED OF TRUST Page 20
(Continued)
claim satisfactory to Lender.
BREACH OF OTHER AGREEMENT. Any breach by
Trustor under the terms of any other agreement
between Trustor and Lender that is not remedied
within any grace period provided therein,
including without limitation any agreement
concerning any indebtedness or other obligation
of Trustor to Lender, whether existing now or
later.
EVENTS AFFECTING GUARANTOR. Any of the
preceding events occurs with respect to any
Guarantor of any of the Indebtedness or any
Guarantor dies or becomes incompetent, or
revokes or disputes the validity of, or
liability under, and Guaranty of the
Indebtedness. Lender, at its option, may, but
shall not be required to, permit the Guarantors
estate to assume unconditionally the
obligations arising under the guaranty in a
manner satisfactory to Lender, and, in doing
so, cure the Event of Default.
ADVERSE CHANGE. A material adverse change
occurs in Trustor's financial condition, or
Lender believes the prospect of payment or
performance of the Indebtedness is impaired.
RIGHT TO CURE. If such a failure is curable and
if Trustor has not been given a notice of a
breach of the same provision of this Deed of
Trust within the preceding twelve (12) months,
it maybe cured (and no Event of Default will
have occurred) if Trustor, after Lender sends
written notice demanding cure of such failure;
(a) cures the failure within fifteen (15) days;
or (b) if the cure requires more than fifteen
(15) days, immediately initiates steps
sufficient to cure the failure and thereafter
continues and completes all reasonable and
necessary steps sufficient to produce
compliance as soon as reasonably practical.
RIGHTS AND REMEDIES ON DEFAULT. Upon the
occurrence of any Event of Default and at any time
thereafter, Trustee or Lender, at its option, may
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04-22-97 DEED OF TRUST Page 21
(Continued)
exercise any one or more of the following rights
and remedies, in addition to any other rights or
remedies provided by law:
ACCELERATE INDEBTEDNESS. Lender shall have the
right at its option without notice to Trustor
to declare the entire Indebtedness immediately
due and payable, including any prepayment
penalty which Trustor would be required to pay.
FORECLOSURE. With respect to all or any part of
the Real Property, the Trustee shall have the
right to foreclose by notice and sale, and
Lender shall have the right to foreclose by
judicial foreclosure, in either case in
accordance with and to the full extent provided
by applicable law. To the extent permitted by
law Trustor shall be and remain liable for any
deficiency remaining after sale, either
pursuant to the power of sale or judicial
proceedings.
UCC REMEDIES. With respect to all or any part
of the Personal Property, Lender shall have all
the rights and remedies of a secured party
under the Uniform Commercial Code.
COLLECT RENTS. Lender shall have the right,
without notice to Trustor, to take possession
of and manage the Property and collect the
Rents; including amounts past due and unpaid,
and apply the net proceeds, over and above
Lender s costs, against the Indebtedness. In
furtherance of this right, Lender may require
any tenant or other user of the Property to
make payments of rent or use fees directly to
Lender. If the rents are collected by Lender,
then Trustor irrevocably designates Lender as
Trustor's attorney-in-fact to endorse
instruments received in payment thereof in the
name of Trustor and to negotiate the same and
collect the proceeds. Payments by tenants or
other users to Lender in response to Lender's
demand shall satisfy the obligations for which
the payments are made, whether or not any
proper grounds for the demand existed. Lender
may exercise its rights under this subparagraph
==================================================
04-22-97 DEED OF TRUST Page 22
(Continued)
either in person, by agent, or through a
receiver.
APPOINT RECEIVER. Lender shall have the right
to have a receiver appointed to take possession
of all or any p art of the Property, with
the power to protect and preserve the Property,
to operate the Property preceding foreclosure
or sale, and to collect the Rents from the
Property and apply the proceeds, over and above
the cost of the receivership, against the
Indebtedness The receiver may serve without
bond if permitted by law. Lender s right to the
appointment of a receiver shall exist whether
or not the apparent value of the Property
exceeds the Indebtedness by a substantial
amount. Employment by Lender shall not
disqualify a person from serving as a receiver.
TENANCY AT SUFFERANCE. If Trustor remains in
possession of the Property after the Property
is sold as provided above or Lender otherwise
becomes entitled to possession of the Property
upon default of Trustor, Trustor shall become a
tenant at sufferance of Lender or the purchaser
of the Property and shall, at Lender's option,
either (a) pay a reasonable rental for the use
of the Property, or (b) vacate the Property
immediately upon the demand of the Lender.
OTHER REMEDIES. Trustee or Lender shall have
any other right or remedy provided in this Deed
of Trust or the Note or by law or in equity or
by other rights and remedies afforded by
Arizona law.
NOTICE OF SALE. Lender shall give Trustor
reasonable notice of the time and place of any
public sale of the Personal Property or of the
time after which any private sale or other
intended disposition of the Personal Property
is to be made. Reasonable notice shall mean
notice given at least ten (10) days before the
time of the sale or disposition. Any sale of
Personal Property may be made in conjunction
with any sale of the Real Property.
==================================================
04-22-97 DEED OF TRUST Page 23
(Continued)
SALE OF THE PROPERTY. To the extent permitted
by applicable law, Trustor hereby waives any
and all rights to have the Property marshalled.
In exercising its rights and remedies, the
Trustee or Lender shall be free to sell all or
any part of the Property together or separately
in one sale or by separate sales. Lender shall
be entitled to bid at any public sale on all or
any portion of the Property.
INSURANCE POLICIES. Beneficiary shall have the
right upon an Event of Default, but not the
obligation, to assign all of Trustor s right,
title and interest in and to all policies of
insurance on the Property and any unearned
premiums paid on such insurance to any receiver
or any purchaser of the Property at a
foreclosure sale, and Trustor hereby appoints
Beneficiary as attorney in fact to assign and
transfer such policies.
WAIVER; ELECTION OF REMEDIES. A waiver by any
party of a breach of a provision of this Deed
of Trust shall not constitute a waiver of or
prejudice the party's rights otherwise to
demand strict compliance with that provision or
any other provision. Election by Lender to
pursue any remedy provided in this Deed of
Trust, the Note, in any Related Document, or
provided by law shall not exclude pursuit of
any other remedy, and an election to make
expenditures or to take action to perform an
obligation of Trustor under this Deed of Trust
after failure of Trustor to perform shall not
affect Lender's right to declare a default and
to exercise any of its remedies.
ATTORNEYS' FEES; EXPENSES. If Lender institutes
any suit or action to enforce any of the terms
of this Deed of Trust, Lender shall be entitled
to recover such sum as the court may adjudge
reasonable as attorneys' fees at trial and on
any appeal. Whether or not any court action is
involved, all reasonable expenses incurred by
Lender which in Lender s opinion are necessary
at any time for the protection of its interest
or the enforcement of its rights shall become a
==================================================
04-22-97 DEED OF TRUST Page 24
(Continued)
part of the Indebtedness payable on demand and
shall bear interest at the Note rate from the
date of expenditure until repaid Expenses
covered by this paragraph include, without
limitation, however subject to any limits under
applicable law, Lender s attorneys fees whether
or not there is a lawsuit, including attorneys
fees for bankruptcy proceedings (including
efforts to modify or vacate any automatic stay
or injunction), appeals and any anticipated
post-judgment collection services, the cost of
searching records obtaining title reports
(including foreclosure reports), surveyors'
reports, appraisal fees, title insurance, and
fees for the Trustee to the extent permitted by
applicable law. Trustor also will pay any court
costs, in addition to all other sums provided
by law.
RIGHTS OF TRUSTEE. Trustee shall have all of
the rights and duties of Lender as set forth in
this section.
POWERS AND OBLIGATIONS OF TRUSTEE. The following
provisions relating to the powers and obligations
of Trustee are part of this Deed of Trust.
POWERS OF TRUSTEE. In addition to all powers of
Trustee arising as a matter of law, Trustee
shall have the power to take the following
actions with respect to the Property upon the
written request of Lender and Trustor: (a join
in preparing and filing a map or plat of the
Real Property, including the dedication of
streets or other rights to the public; (b) join
in granting any easement or creating any
restriction on the Real Property; and (c) join
in any subordination or other agreement
affecting this Deed of Trust or the interest of
Lender under this Deed of Trust.
OBLIGATIONS TO NOTIFY. Trustee shall not be
obligated to notify any other party of a
pending sale under any other trust deed or
lien, or of any action or proceeding in which
Trustor, Lender, or Trustee shall be a party,
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04-22-97 DEED OF TRUST Page 25
(Continued)
unless the action or proceeding is brought by
Trustee.
TRUSTEE. Trustee shall meet all qualifications
required for Trustee under applicable law. In
addition to the rights and remedies set forth
above, with respect to all or any part of the
Property, the Trustee shall have the right to
foreclose by notice and sale, and Lender shall
have the right to foreclose by judicial
foreclosure, in either case in accordance with
and to the full extent provided by applicable
law.
SUCCESSOR TRUSTEE. Lender, at Lender's option,
may from time to time appoint a successor
Trustee to any Trustee appointed hereunder by
an instrument executed and acknowledged by
Lender and recorded in the office of the
recorder of Maricopa County, Arizona. The
instrument shall contain, in addition to all
other matters required by state law, the names
of the original Lender, Trustee, and Trustor,
the book and page where this Deed of Trust is
recorded and the name and address of the
successor trustee, and the instrument shall be
executed and acknowledge by Lender or its
successors in interest. The successor trustee,
without conveyance of the Property, shall
succeed to all the title, power, and duties
conferred upon the Trustee in this Deed of
Trust and by applicable law. This procedure for
substitution of trustee shall govern to the
exclusion of all other provisions for
substitution.
NOTICES TO TRUSTOR AND OTHER PARTIES. Any notice
under this Deed of Trust shall be in writing, may
be sent by telefacsimile, and shall be effective
when actually delivered, or when deposited with a
nationally recognized overnight courier, or, if
mailed, shall be deemed effective when deposited
in the United States mail first class, certified
or registered mail postage prepaid, directed to
the addresses shown near the beginning of this
Deed of Trust. Any party may change its address
for notices under this Deed of Trust by giving
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04-22-97 DEED OF TRUST Page 26
(Continued)
formal written notice to the other parties,
specifying that the purpose of the notice is to
change the party's address. All copies of notices
of foreclosure from the holder of any lien which
has priority over this Deed of Trust shall be sent
to Lender's address, as shown near the beginning
of this Deed of Trust. For notice purposes,
Trustor agrees to keep Lender and Trustee informed
at all times of Trustor's current address.
APPRAISALS. Grantor agrees to ay the cost of all
appraisals and appraisal reviews required by
Lender in its sole discretion (a) to comply with
(i) any applicable statute or regulation or (ii)
the request or directive (whether or not having
the force of law of any regulatory authority with
jurisdiction over Lender, or (b) at any time after
the occurrence of an event of default. All such
appraisal costs shall become a part of the
indebtedness secured hereby and payable on demand,
together with interest thereon at the highest rate
applicable to any such Indebtedness.
FINANCIAL INFORMATION. From time to time, upon
request by Lender, Grantor shall provide, and
shall cause any Guarantor of the Indebtedness to
provide, such financial information concerning
such person or the Property as Lender may require.
Such information may include without limitation
financial statements, tax returns and operating
statements regarding the Property.
ADDITIONAL COLLATERAL. In addition to the Property
identified on page 1 of the Deed of Trust, the
Property shall also include and Grantor hereby
grants to Lender a security interest in, all of
Grantor s now owned and hereafter acquired (a)
equipment and inventory which is at any time
located on and used in connection with the real
property described in this Deed of Trust or any
business operated thereon; (b) accounts general
intangibles, instruments money, cash equivalents
and income or revenues of any nature which arise
from or relate to the operation of such property
or any such business; and (c) all proceeds of any
of the foregoing. All of the foregoing collateral
shall be part of the personal property as that
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04-22-97 DEED OF TRUST Page 27
(Continued)
term is used in this Deed of Trust.
ORAL AGREEMENTS. ORAL AGREEMENTS OR ORAL
COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT
ENFORCEABLE UNDER WASHINGTON LAW.
ACCESS LAWS. (a Grantor agrees that Grantor and
the Property shall at all times strictly comply
with the requirements of the Americans with
Disabilities Act of 1990. the Fair Housing
Amendments Act of 1988; and other federal, state,
or local laws or ordinances related to disabled
access; or any statute, rule, regulation,
ordinance, order of governmental bodies and
regulatory agencies, or order or decree of any
court adopted or enacted with respect thereto, as
now existing or hereafter amended or adopted
(collectively, the "Access Laws"). At any time,
Lender may require a certificate of compliance
with the Access Laws and indemnification agreement
in a form reasonably acceptable to Lender. Lender
may also require a certificate of compliance with
the Access Laws from an architect, engineer, or
other third party acceptable to Lender.
(b) Notwithstanding any provisions set forth
herein or in any other document, Grantor shall not
alter or permit any tenant or other person to
alter the Property in any manner which would
increase Grantor's responsibilities for compliance
with the Access Laws without the prior written
approval of Lender. In connection with such
approval, Lender may require a certificate of
compliance with the Access Laws from an architect,
engineer, or other person acceptable to Lender.
(c) Grantor agrees to give prompt written notice
to Lender of the receipt by Grantor of any claims
of violation of any of the Access Laws and of the
commencement of any proceedings or investigations
which relate to compliance with any of the Access
Laws.
(d) Grantor shall indemnify, defend, and hold
harmless Lender from and against any and all
claims, demands, damages, costs, expenses, losses,
liabilities,. penalties, fines, and other
proceedings including without limitation
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04-22-97 DEED OF TRUST Page 28
(Continued)
reasonable attorneys fees and expenses arising
directly or indirectly from or out of or in anyway
connected with any failure of the Property to
comply with any of the Access Laws. The
obligations and liabilities of Grantor under this
section shall survive any termination,
satisfaction, assignment, judicial or nonjudicial
foreclosure proceeding, or delivery of a deed in
lieu of foreclosure.
MISCELLANEOUS PROVISIONS. The following
miscellaneous provisions are a part of this Deed
of Trust:
AMENDMENTS. This Deed of Trust, together with
any Related Documents constitutes the entire
understanding and agreement of the parties as to
the matters set forth in this Deed of Trust. No
alteration of or amendment to this Deed of Trust
shall be effective unless given in writing and
signed by the party or parties sought to be
charged or bound by the alteration or amendment.
ANNUAL REPORTS. If the Property is used for
purposes other than Trustor's residence,
Trustor shall furnish to Lender upon request, a
certified statement of net operating income
received from the Property during Trustor's
previous fiscal year in such form and detail as
Lender shall require. Net operating income"
shall mean all cash receipts from the Property
less all cash expenditures made in connection
with he operation of the Property.
ARBITRATION. Lender and Trustor agree that all
disputes, claims and controversies between
them, whether individual, joint, or class in
nature, arising from this Deed of Trust or
otherwise, including without limitation
contract and tort disputes, shall be arbitrated
pursuant to the Rules of the American
Arbitration Association, upon request of either
party. No act to take or dispose of any
Collateral shall constitute a waiver of this
arbitration agreement or be prohibited by this
arbitration agreement. This includes, without
limitation, obtaining injunctive relief or a
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04-22-97 DEED OF TRUST Page 29
(Continued)
temporary restraining order; invoking a power
of sale under any deed of trust or mortgage;
obtaining a writ of attachment or imposition of
a receiver; or exercising any rights relating
to personal property, including taking or
disposing of such property with or without
judicial process pursuant to Article 9 of the
Uniform Commercial Code. Any disputes, claims,
or controversies concerning the lawfulness or
reasonableness of any act, or exercise of any
right, concerning any Collateral, including any
claim to rescind, reform, or otherwise modified
any agreement relating to the Collateral, shall
also be arbitrated, provided however that no
arbitrator shall have the right or the power to
enjoin or restrain any act of any party.
Judgment upon any award rendered by any
arbitrator may be entered in any court having
jurisdiction. Nothing in this Deed of Trust
shall preclude any party from seeking equitable
relief from a court of competent jurisdiction
The statute of limitations, estoppel, waiver,
laches, and similar doctrines which would
otherwise be applicable in an action brought by
a party shall be applicable in any arbitration
proceeding, and the commencement of an
arbitration proceeding shall be deemed the
commencement if an action for these purposes.
The Federal Arbitration Act shall apply to the
construction, interpretation, and enforcement
of this arbitration provision.
APPLICABLE LAW. This Deed of Trust has been
delivered to Lender and accepted by Lender in the
State of Washington. Except as set forth
hereinafter, this Deed of Trust shall be governed
by, construed and enforced in accordance with the
laws of the State of Washington, except and only
to the extent of procedural matters related to the
perfection and enforcement by Lender of its rights
and remedies against the Property, which matters
shall be governed by the laws of the State of
Arizona. However, in the event that the
enforceability or validity of any provision of
this Deed of Trust is challenged or questioned,
such provision shall be governed by whichever
applicable state or federal law would uphold or
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04-22-97 DEED OF TRUST Page 30
(Continued)
would enforce such challenged or questioned
provision. The loan transaction which is evidenced
by the Note and this Deed of Trust (which secures
the Note) has been applied for, considered,
approved and made in the State of Washington.
Caption Headings. Caption headings in this Deed of
Trust are for convenience purposes only and are
not to be used to interpret or define the
provisions of this Deed of Trust.
MERGER. There shall be no merger of the interest
or estate created by this Deed of Trust with any
other interest or estate in the Property at any
time held by or for the benefit of Lender in any
capacity, without the written consent of Lender.
MULTIPLE PARTIES; CORPORATE AUTHORITY. All
obligations of Trustor under this Deed of Trust
shall be joint and several, and all references to
Trustor shall mean each and every Trustor. This
means that each of the persons signing below is
responsible for all obligations in this Deed of
Trust.
SEVERABILITY. If a court of competent jurisdiction
finds any provision of this Deed of Trust to be
invalid or unenforceable as to any person or
circumstance, such finding shall not render that
provision invalid or unenforceable as to any other
persons or circumstances. If feasible, any such
offending provision shall be deemed to be modified
to be within the limits of enforceability or
validity; however, if the pending provision cannot
be so modified, it shall be stricken and all other
provisions of this Deed of Trust in all other
respects shall remain valid and enforceable.
SUCCESSORS AND ASSIGNS. Subject to the limitations
stated in this Deed of Trust or transfer of
Trustor's interest, this Deed of Trust shall be
binding upon and inure to the benefit of the
parties, their successors and assigns. If
ownership of the Property becomes vested in a
person other than Trustor, Lender, without notice
to Trustor may deal with Trustor s successors with
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04-22-97 DEED OF TRUST Page 31
(Continued)
reference to this Deed of Trust and the
Indebtedness by way of forbearance or extension
without releasing Trustor from the obligations of
this Deed of Trust or liability under the
Indebtedness.
TIME IS OF THE ESSENCE. Time is of the essence in
the performance of this Deed of Trust.
WAIVERS AND CONSENTS. Lender shall not be deemed
to have waived any rights under this Deed of Trust
(or under the Related Documents) unless such
waiver is in writing and signed by Lender. No
delay or omission on the part of Lender in
exercising any right shall operate. as a waiver of
such right or any other right. A waiver by any
party of a provision of this Deed of Trust shall
not constitute a waiver of or prejudice the
party's right otherwise to demand strict
compliance with that provision or any other
provision. No prior waiver by Lender nor any
course of dealing between Lender and Trustor,
shall constitute a waiver of and of Lender's
rights or any of Trustor's obligations as to any
future transactions. Whenever consent by Lender is
required in this Deed of Trust the granting of
such consent by Lender in any instance shall not
constitute continuing consent to subsequent
instances where such consent is required.
WAIVER OF HOMESTEAD EXEMPTION. Trustor hereby
releases and waives all rights and benefits of the
homestead exemption laws of the State of Arizona
as to all Indebtedness secured by this Deed of
Trust.
Unless you provide us with evidence of the
insurance coverage as required by our contract or
loan agreement, we may purchase insurance at your
expense to protect our interest. This insurance
may, but need not, also protect your interest. If
the collateral becomes damaged, the coverage we
purchase may not pay any claim you make or any
claim made against you. You may later cancel this
coverage by providing evidence that you have
obtained property coverage elsewhere.
==================================================
04-22-97 DEED OF TRUST Page 32
(Continued)
You are responsible for the cost of any insurance
purchased by us. The cost of this insurance may be
added to your contract or loan balance. If the
cost is added to your contract or loan balance,
the interest rate on the underlying contract or
loan will apply to this added amount. The
effective date of coverage may be the date your
prior coverage lapsed or the date you failed to
provide proof of coverage.
The coverage we purchase may be considerably more
expensive than insurance you can obtain on your
own and may not satisfy any need for property
damage coverage or any mandatory liability
insurance requirements imposed by applicable law.
EACH TRUSTOR ACKNOWLEDGES HAVING READ ALL THE
PROVISIONS OF THIS DEED OF TRUST, AND EACH TRUSTOR
AGREES TO ITS TERMS.
TRUSTOR:
EMERITUS PROPERTIES VI, INC.,
a Washington corporation
By: /s/ Raymond R. Brandstrom
--------------------------
Raymond R. Brandstrom, President
By: /s/ Kelly J. Price
--------------------------
Kelly J. Price, Vice President & Secretary
==================================================
04-22-97 DEED OF TRUST Page 33
(Continued)
CORPORATE ACKNOWLEDGMENT
STATE OF WASHINGTON )
) ss
COUNTY OF KING )
On this 22nd day of April, 1997, before me, the
undersigned Notary Public, personally appeared
Raymond R. Brandstrom, President; and Kelly Price,
Vice President & Secretary of EMERITUS PROPERTIES
VI, INC., a Washington corporation, and known to
me to be authorized agents of the corporation that
executed the Deed of Trust and acknowledged the
Deed of Trust to be the free and voluntary act and
deed of the corporation, by authority of its
Bylaws or by resolution of its board of directors,
for the uses and purposes therein mentioned, and
on oath stated that they are authorized to execute
this Deed of Trust and in fact executed the Deed
of Trust on behalf of the corporation.
By /s/Catherine L. Pasquan
Residing at Seattle, WA
Notary Public in and for the State of Washington
My commission expires 3-30-99
[NOTARY SEAL]