ADDENDUM TO DEED OF TRUST
The Deed of Trust attached hereto is hereby
amended as follows:
1. Any and all references to "Grantor" shall
mean the Trustor, as defined in the Deed of Trust.
2. The paragraph in bold type immediately
following the definition of "Trustor" on page 2 of
the Deed of Trust is amended in its entirety and
superseded by the following:
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. ANY EVENT
OF DEFAULT UNDER ANY OF THE RELATED DOCUMENTS
SHALL ALSO BE AN EVENT OF DEFAULT UNDER THIS
DEED OF TRUST. THE NOTE AND THIS DEED OF
TRUST ARE GIVEN AND ACCEPTED ON TIIE
FOLLOWING TERMS:
3. The subparagraph beginning on page 2 with
the heading "Hazardous Substances" is hereby
amended in its entirety and superseded by the
following:
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 Recover 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
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substance" shall also include, without
limitation , petroleum, and petroleum by-
products or any fraction thereof and
asbestos. 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, except as permitted by
applicable law; (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 or in any
environmental assessment or report provided
to Lender, (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 continued in compliance
with all applicable federal, state and local
laws, regulations and ordinances, including
without limitation those laws, regulations,
and ordinances described above. At reasonable
times and upon reasonable notice to Trustor,
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; provided that said
reasonable time and notice requirements are
not applicable in the event: an emergency
situation exists which may either result in
damage to the Property and/or injury to
persons or property unless such inspection or
testing is conducted immediately.
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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
warranties contained herein are based on
Trustor's due diligence iii 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 (b) agrees to
identify 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 Trustor's 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.
4. The subparagraph on page 3 with the
heading "Lender's Right to Enter" is hereby
amended in its entirety and superseded by the
following:
Lender's Right to Enter. Lender and its
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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 of Trustor's
compliance with the terms and conditions of
this Deed of Trust, provided that Lender
shall provide Trustor reasonable notice of
such inspection provided that said reasonable
time and notice requirements are not
applicable in the event an emergency
situation exists which may either result in
damage to the Property and/or injury to
persons or property unless such inspection is
conducted immediately.
5. The paragraph on page 3 with the heading
"Due on Sale -- Consent by Lender" is amended in
its entirety and superseded by the following:
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 out right sale, deed, installment
sale contract, land contract, contract for
deed, leasehold interest with a term greater
than three (3) 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 fifty
percent (50%) 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.
The foregoing provisions of this paragraph
shall not apply to any sale or transfer to
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any subsidiary or affiliate of Emeritus
Corporation, a Washington corporation.
6. The subparagraph on page 3 with the
heading "Payment" is hereby amended in its
entirety and superseded by the following:
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. Trustee
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 the event that
Beneficiary exercises the foregoing right and
receives any amount from Trustor attributable
to such taxes, Beneficiary shall have the
obligation and responsibility to timely pay
the subject taxes.
7. The reference to $ 1,000.00 in the
subparagraph on page 4 with the heading
"Application of Proceeds" is replaced by
$25,000.00. In addition, the last sentence of this
subparagraph is amended in its entirety and
superseded by the following: "If Lender holds any
proceeds after payment in full of the
Indebtedness, Lender shall pay such proceeds to
Borrower."
8. The paragraph on page 4 with the heading
"Tax and Insurance Reserves" is hereby amended and
superseded by the following:
Tax and Insurance Reserves. Subject to any
limitations set by applicable law, Lender may
require Trustor to maintain with Lender
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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; provided
that Lender shall not have the right to
impose such reserve requirement upon Trustor
so long as Trustor pays said taxes,
assessments and insurance premiums as they
become due. The reserve funds shall be held
by Lender as a general deposit from Trustor,
which Lender may satisfy the payment of the
taxes, assessments, and insurance premiums
required to be paid by Trustor as they become
due. Lender shall have the right to draw upon
the reserve funds to pay such items. 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 any 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. Upon receipt by Beneficiary of
sufficient reserve funds to pay any of the
subject taxes or insurance premiums,
Beneficiary shall have the obligation and
responsibility to timely pay such taxes or
insurance premiums. Beneficiary, however,
does not hold such reserve funds in trust for
Trustor.
9. The subparagraph on page 5 with the
heading "Taxes" is hereby amended in its entirety
and superseded by the following:
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
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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 indebtedness or on
payments of principal and interest made by
Trustor. Notwithstanding the foregoing, the
provisions of this paragraph shall not apply
to any income taxes attributable to the
payments of principal, interest or any
portion of the Indebtedness.
10. The subparagraph on page 5 with the
heading "Defective Collateralization" is
hereby deleted.
11. The subparagraph on page 6 with the
heading "Breach of Other Agreement" is hereby
amended in its entirety and superseded by the
following:
Breach of Other Agreement. Any breach by
Trustor under the terms of any of the Related
Documents that is not remedied within any
grace period provided therein.
12. The subparagraph on page 6 with the
heading "Events Affecting Guarantor" is hereby
amended in its entirety and superseded by the
following:
Events Affecting Guarantor. Any of the
preceding events occur with respect to any
Guarantor of any of the Indebtedness or any
(Guarantor dies or revokes or disputes the
validity of, or liability under, any Guaranty
of the Indebtedness; provided that the death
of any Guarantor shall not be an Event of
Default if the Guarantor's estate
unconditionally assumes the obligations
arising under the Guaranty.
13. The last sentence of the paragraph on
page 8 with the heading "Multiple Parties" is
hereby deleted.
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14. The following subparagraph shall be added
to the Deed of Trust after the subparagraph on
page 8 with the heading "Waiver of Homestead
Exemption":
Additional Documentation. In the event that
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, Borrower agrees to execute
such documents which Lender may reasonably
require in order to make this Deed of Trust
or any of the Related Documents valid and
effective; provided that the Indebtedness or
any portion thereof, remains unpaid at such
time.
By their signatures set forth below, Lender
and Trustor acknowledge and agree that this
Addendum shall be incorporated into and deemed to
be a part of the Deed of Trust, and that in the
event of a conflict between the terms of this
Addendum and the attached Deed of Trust, the terms
of this Addendum shall control.
Lender:
U.S. BANK OF WASHINGTON
National Association
By: /s/ Monica Rhule
--------------------
Its: Loan Admin Officer
Trustor:
EMERITUS PROPERTIES VI, INC.,
a Washington corporation
By: /s/ Raymond R. Brandstrom
--------------------------
Its: President
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STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory
evidence that Monica M. Rhule is the person who
appeared before me, and said person
acknowledged that he/she signed this instrument,
on oath stated that he/she was authorized to
execute the instrument and acknowledge it as the
Loan Admin Officer of U.S. Bank of Washington to
be the free and voluntary act of such party for
the uses and purposes mentioned in the instrument.
Dated this 22 day of April, 1997.
[SEAL OF NOTARY] /s/ L.B. Day
-----------------------
Printed Name: L.B. Day
Notary Public in and for the
Sate of Washington, residing
at Seattle
My commission expires 3/26/98
STATE OF WASHINGTON )
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