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MMD2017-00012 NOTICE OF TYPE I DECISION MINOR MODIFICATION MMD2017-00012 -051 SN PROPERTIES PARTNERSHIP TIGARD 120 DAYS = August 24, 2017 SECTION I. APPLICATION SUMMARY FILE NAME: SN Properties Partnership CASE NO.: Minor Modification (MMD) MMD2017-00012 PROPOSAL: The applicant is proposing a change of use to a tenant space at 16200 SW Pacific Highway,Suite W1.The 1,200-square-foot tenant space was previously vacant,and will now be occupied by a repair-oriented retail use (drop-off pet grooming). APPLICANT: Candice Cordier 6860 SW Lisbon Court Aloha, OR 97078 OWNER: SN Properties Partnership Attn: Lindy Goodling 1430 SW Broadway, Suite 100 Portland, OR 97201 LOCATION: 16200 SW Pacific Highway,Suite W1 WCTM 2S115BA,Tax Lot 2500 ZONING DESIGNATION: C-G: General Commercial District. The C-G zoning district is designed to accommodate a full range of retail, office and civic uses with a city-wide and even regional trade area. Except where nonconforming, residential uses are limited to single-family residences which are located on the same site as a permitted use. A wide range of uses, including but not limited to adult entertainment, automotive equipment repair and storage, mini-warehouses, utilities, heliports, medical centers, major event entertainment, and gasoline stations, are permitted conditionally. APPLICABLE REVIEW CRITERIA: Community Development Code Chapters 18.360.060.0 SECTION II. DECISION Notice is hereby given that the City of Tigard Community Development Director's designee has APPROVED the above request. The findings and conclusions on which the decision is based are noted in Section IV. h1R1D2017-00012 SN Properties Partnership 1 THIS APPROVAL SHALL BE VALID FOR 18 MONTHS FROM THE EFFECTIVE DATE OF THIS DECISION. SECTION III. BACKGROUND INFORMATION Site Information: The project is located at 16200 SW Pacific Highway, Suite W1; south of SW Durham Road,west of SW 113th Avenue, and east of SW Pacific Highway. The property is located in the Tigard Towne Square shopping center, which is made up of seven (7) tax lots totaling 20.45 acres, and contains associated parking and landscaping. The subject tenant space is 1,200 square feet in size, and was previously vacant. The property is zoned General Commercial (C-G). SECTION IV. APPLICABLE REVIEW CRITERIA AND FINDINGS MINOR MODIFICATION OF SITE DEVELOPMENT REVIEW: Section 18.360.060.0 states that a Minor Modification shall be approved, approved with conditions or denied following the Director's review and as follows: 1. The proposed development is in compliance with all applicable requirements of this title; and FINDING: Because the applicant has only proposed a change of use, which primarily affects off- street parking regulations, that is the main focus of this review. The change of use is to repair-oriented retail. The 20.45-acre Tigard Towne Square shopping center is a mixed-use, multi-tenant site, and is therefore subject to the required minimum vehicle parking formula outlined in MC 18.765.030.D. The table below calculates the minimum off-street vehicle requirements based on this formula: Square Parking Spaces Percentage Total Parking Spaces Use Category Footage Required Required Required Sales-Oriented Retail 151,602 455 100% 455 Fast Food Eating& Drinking Establishment 15,432 108 85°0 92 Indoor Entertainment 8,484 36 70% 26 Personal Services (Banks with Drive Ins) 7,656 23 60°o 14 Medical/Dental Office 3,282 13 60% 8 Eating& Drinking Establishment 2,624 24 60% 14 Repair-Oriented Retail 2,600 9 60% 5 Personal Services 2,425 6 60°/0 4 TOTAL 617 Staff finds that 617 parking spaces are required for the entire shopping center, taking into consideration the change of use discussed above. Based on the applicant's submitted site plan, staff finds there is MN1D2017-00012 SN Properties Partnership 2 adequate parking at the development site,with 920 parking spaces provided. Upon review of the applicant's plans and narrative, staff finds that all other applicable requirements are met.This criterion is met. 2. The modification is not a major modification. FINDING: Staff finds that the changes listed in TDC 18.360.050.B.1-11 are either satisfied or do not apply.Therefore, the proposed development is not a major modification.This criterion is met. CONCLUSION: The proposal is a Minor Modification of existing site development and is in compliance with the applicable requirements of this Title. SECTION V. PROCEDURE AND APPEAL INFORMATION Notice: Notice was posted at City Hall and mailed to: X The applicant and owners X Affected government agencies Final Decision: A Minor Modification is a Type I procedure. As such, the Director's decision is final on the date it is mailed or otherwise provided to the applicant,whichever occurs first. The Director's decision may not be appealed locally and is the final decision of the City. THIS DECISION IS FINAL ON MAY 1, 2017 AND BECOMES EFFECTIVE ON MAY 2, 2017 Questions: If you have any questions,please contact Lina Smith at (503) 718-2438 or LinaCS(a tigard-or.gov. May 1.2017 APPROVED BY: Lina Smith Assistant Planner MMD2017-00012 SN Properties Partnership 4 )-0 )--1 't til otl i?-j C ) H Z C/1 ).-1 RECEIVED APR 2 4 2017 City of Tigard " C:OMMUNITY DEVELOPMENT DEPARTMENT CITY OF TIGARD PLANNING/ENGINEcR TI(:n' Minor Modification Type I Application PROPOSAL SUMMARY (Brief description) A 0 a - f,,It' REQUIRED SUBMITTAL - i li�ii -1 L11 r S,�_.r_ ELEMENTS -/ "iiiaff� I )4 Owners Signature/Written aff Authorization Title Transfer Instrument or Deed Site Plan(2 large plans drawn to scale Property address/location(s):1�P LOC) . i.t� Pdr�r� reduced to 8.5"x11'h"} ,.' r7 X"Applicant's Statement/Narrative `S`-""1` w"/ (2 copies)Address criteria in: Tax map and tax lot #(s): o2J�Q 'PUC 1R360.050.R.1-I t Filing Fee Site size: Applicant': � OA`ccs l�C)l c{ atm • i„i< ,i �: i I c, .i , Address: 6?(&0J $(.e.} Lti.s n C4, Case• No.: �� -«'2'��� City/stare: c(11ti G1 • R Zip: 79 7A Related Case No.(s): Phone:'Th Zc 1/069 Email: r> Application Fee: g .COYhI.,. Application accepted: PROPERTY OWNER/DEED HOLDER(S)• Cl Same as Applicant By:—� Date: -�� Name: 5H .77 7I,er77n.A))I / I l I'p eQ fr�CP�-1ppL'ation determined compleoe /l Address: `lJ 8 �( 1 �- & '60 _ ' By: 1---C Date: 4 1'3—* : City/state: a Q•M ' (OR- df "Lip: ZO/ rwuR.un..n«.w,+w.Application .„,.,yna.• Contact name: //4)2j )( GrU45LJ") Phone number: (S - of 77. Q 2./ •When the owner and the applicant are different people,the applicant must be the purchaser of record or a lessee in possession with written authorization from the owner or an agent of the owner.The owner(s)must sign this application in the space provided on the back of this form or submit a written authorization with this application. APPLICANT'S STATEMENT The applicant's statement must include a summary of the proposed changes.Criteria in either 18.360.050(B)or 18.330.020(13)(2)must be addressed with a detailed response to each criterion. Failure to provide the information needed to process the application would be reason to consider an application incomplete and delay review of the proposal. In addition,the Director must find that the proposed change is in compliance with all applicable requirements of Tide 18 of the Tigard Development Code. 'Io complete this review,the Applicant's proposal must include a discussion indicating how the site expansion/change will continue to comply with the maximum setback,building height,parking,and landscaping standards. Other requirements of this title such as clear vision,solid waste storage,non-conforming situations,signs,and tree removal may also be applicable depending on the type and location of the proposed modifications. City of Tigard • 13125 SW Hall Blvd. • Tigard,Oregon 97223 • www.tigard-or.gov • 503-718-2421 • Page 1 of 2 f Scanned by CamScanner APPLICANTS To consider an application complete,you will need to submit ALL of the REQUIRED SUBMITTALELEMENTS as described on the front of this application in the"Required Submittal Elements"box. THE APPLICANT(S) SHALL CERTIFY THAT: • The above request does not violate any deed restrictions that may be attached to or imposed upon the subject property. • If the application is granted,the applicant will exercise the rights granted in accordance with the terms and subject to all the conditions and limitations of the approval. • All of the above statements and the statements in the plot plan,attachments,and exhibits transmitted herewith,are true;and the applicants so acknowledge that any permit issued,based on this application,may be revoked if it is found that any such statements are false. • The applicant has read the entire contents of the application,including the policies and criteria,and understands the requirements for approving or denying the application. SIGNATURES of each owner of the subject property required. pplica'signature Print name Date ,..:. itiA3PYGr6>61- 4"22 .17 •caner'• signature pad , t name Date Owner's signature Print name Date ADDITIONAL OWNER/DEED HOLDER INFORMATION Name: Name: Address: Address: City/state: Zip: City/state: Zip: Signature: Signature: MINOR MODIFICATION APPLICATION City of Tigard • 13125 SW Hall Blvd. • Tigard,Oregon 97223 • www.tigard-or.gov • 503-718-2421 • Page 2 of 2 APPLICANTS To consider an application complete,you will need to submit ALL of the Rt OUIR .D St 1 isi TTAi ELEMENTS as described on the front of this application in the"Required Submittal Elements"box. THE APPLICANT(S)SHALL CERTIFY THAT: • ■ .. •• - • •• .• , • 4 ••• •• •• . • • If the application is granted,the applicant will exercise the rights granted in accordance with the terms and subject to all the conditions and limitations of the approval. • All of the above statements and the statements in the plot plan,attachments,and exhibits transmitted herewith,arc true;and the applicants so acknowledge that any permit issued,based on this application,may be revoked if it is found that any such statements are false. • The applicant has read the entire contents of the application,including the policies and criteria,and understands the requirements for approving or denying the application. SIGNATURES of each owner of the subject property required. Applica ' signature Print name Date It-- ir../,?!�y ��r1t,L/ - y,10 •/7 • signature /2t name Date Owner's signature Print name Date ADDITIONAL OWNER/DEED HOLDER INFORMATION Name: Name: Address: Address: City/state: Zip: City/state: Zip: Signature: Signature: Scanned by CamScanner RECEIVED 18.360.050 Major Modification(s)to Approved Plans or Existing Development APR 2 4 2017 B. Evaluation criteria. The director shall determine that a major modification(s)will result if oibY OF TIGARD more of the following changes are proposed. There will be: !INNING/ENGINEERING 1. An increase in dwelling unit density,or lot coverage for residential development; N/A 2. A change in ratio or number of different types of dwelling units; N/A 3. A change that requires additional on-site parking in accordance with chapter 18.765; Opening a dog grooming salon. 4. A change in the type of commercial or industrial structures as defined by the Uniform Building Code; N/A 5. An increase in the height of the building(s) by more than 20%; N/A 6. A change in the type and location of accessways and parking areas where off-site traffic would be affected; N/A 7. An increase in vehicular traffic to and from the site and the increase can be expected to exceed 100 vehicles per day; N/A 8. An increase in the floor area proposed for a nonresidential use by more than 10%excluding expansions under 5,000 square feet; N/A 9. A reduction in the area reserved for common open space and/or usable open space which reduces the open space area below the minimum required by this code or reduces the open space area by more than 10%; N/A 10. A reduction of project amenities below the minimum established by this code or by more than 10%where specified in the site plan: a. Recreational facilities; b. Screening; and/or c. Landscaping provisions. N/A 11. A modification to the conditions imposed at the time of site development review approval which are not the subject of paragraphs 1 through 10 of this subsection. N/A Scanned by CamScanner REC E I v E D Washington County,Oregon 2015-105734 S Stn=201 REED 12/29/2015 10:04:27 AM APR 2 4 2017 $215.00 511.00$15.00$5.00$20.00 $266.00 I,Richard Hobernicht,Director of Assessment and Taxation and Ex- . CITY OF TIGARD Officio County Clerk for Washington County,Oregon,do hereby certify that the within instrument of writing was received and PLANNING/ENGINEERING recorded in the book of records of said county. Richard Hobernicht,Director of Recording Requested By and Assessment and Taxation,Ex-Officio When Recorded Mail To: Virginia M.Pedreira Stoel Rives LLP 600 University Street, Suite 3600 Seattle, Washington 98101 kNolop Loan No. 901001044 TRUST DEED,ASSIGNMENT OF RENTS AND LEASES, t`- AND SECURITY AGREEMENT (ALSO CONSTITUTING A FIXTURE FILING) (Washington County,Oregon) CCS W THIS TRUST DEED, ASSIGNMENT OF RENTS AND LEASES, AND SECURITY AGREEMENT (ALSO CONSTITUTING A FIXTURE FILING) (this "Trust Deed") is made cc this 29 day of December, 2015, by SN INVESTMENT PROPERTIES, LLC, a Delaware limited liability company, as Trustor (the `Borrower"), whose address is 1121 SW Salmon Street, Suite 500, Portland, OR 97205, Attn: Finance Department, to TICOR TITLE COMPANY, as Trustee ("Trustee"), whose address is 111 SW Columbia Street, Suite 100 Portland, Oregon 97201 for the benefit of GENWORTH LIFE AND ANNUITY INSURANCE a COMPANY, a Virginia corporation, as Beneficiary ("Lender"), whose address is Servicing Department, 10851 Mastin St., Suite 300, Overland Park,Kansas 66210. Lender is making a loan (the "Loan")to the Borrower in the principal amount of Fourteen Million Five Hundred Thousand and 00/100 Dollars ($14,500,000.00) to be secured by that certain real property (the "Realty") described in Exhibit A attached hereto, and the rest of the Property described herein. The Loan, if not sooner paid, is due and payable in full on January 1, 2026. The maximum principal amount to be advanced is Fourteen Million Five Hundred Thousand and 00/100 Dollars ($14,500,000.00), provided, however that the maximum principal amount to be advanced may be exceeded by advances to complete construction pursuant to ORS 86.155 (2) (c), if applicable, for reasonable protection of the Real Property, including but not limited to advances to pay real property taxes, hazard insurance premiums, maintenance charges imposed under a declaration of restrictive covenants, reasonable attorneys' fees, and other advances described in paragraph 9.18 or elsewhere in this Trust Deed. 1 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901 001 044 79842026.4 0053805-00296 Recording Requested By and When Recorded Mail To: Virginia M. Pedreira Stoel Rives LLP 600 University Street, Suite 3600 Seattle, Washington 98101 Loan No. 901001044 TRUST DEED,ASSIGNMENT OF RENTS AND LEASES, AND SECURITY AGREEMENT (ALSO CONSTITUTING A FIXTURE FILING) (Washington County, Oregon) THIS TRUST DEED, ASSIGNMENT OF RENTS AND LEASES, AND SECURITY AGREEMENT (ALSO CONSTITUTING A FIXTURE FILING) (this "Trust Deed") is made this 29 day of December, 2015, by SN INVESTMENT PROPERTIES, LLC, a Delaware limited liability company, as Trustor (the "Borrower"), whose address is 1121 SW Salmon Street, Suite 500, Portland, OR 97205, Attn: Finance Department, to TICOR TITLE COMPANY, as Trustee ("Trustee"), whose address is 111 SW Columbia Street, Suite 100 Portland, Oregon 97201 for the benefit of GENWORTH LIFE AND ANNUITY INSURANCE COMPANY, a Virginia corporation, as Beneficiary ("Lender"), whose address is Servicing tc Department, 10851 Mastin St., Suite 300, Overland Park, Kansas 66210. Lender is making a loan (the "Loan")to the Borrower in the principal amount of Fourteen Million Five Hundred Thousand and 00/100 Dollars ($14,500,000.00) to be secured by that certain real property (the "Realty") described in Exhibit A attached hereto, and the rest of the Property described herein. The Loan, if not sooner paid, is due and payable in full on January 1, 2026. The maximum principal amount to be advanced is Fourteen Million Five Hundred Thousand and 00/100 Dollars ($14,500,000.00), provided, however that the maximum principal amount to be advanced may be exceeded by advances to complete construction pursuant to ORS 86.155 (2) (c), if applicable, for reasonable protection of the Real Property, including but not limited to advances to pay real property taxes, hazard insurance premiums, maintenance charges imposed under a declaration of restrictive covenants, reasonable attorneys' fees, and other advances described in paragraph 9.18 or elsewhere in this Trust Deed. Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 For purposes of Article 9 of the Uniform Commercial Code, this Trust Deed constitutes a security agreement and financing statement with Borrower being the Debtor and Lender being the Secured Party. This Trust Deed also constitutes a financing statement filed as a fixture filing pursuant to Article 9 of the Uniform Commercial Code. In consideration of the Loan and to secure the full and absolute payment and performance of the Secured Obligations (hereinafter defined), Borrower hereby irrevocably GRANTS, PLEDGES, TRANSFERS, CONVEYS and ASSIGNS to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit of Beneficiary, all of Borrower's estate, rights, title,claim, interest and demand, either in law or in equity, of, in and to the following property, whether the same be now owned or hereafter acquired (the"Property"): (a) The Realty and all rights to the land lying in alleys, streets and roads adjoining or abutting the Realty; (b) All buildings, improvements and tenements now or hereafter located on the Realty; (c) All fixtures, goods and articles of property now or hereafter attached to, or used or adapted for use in the ownership, development, operation or maintenance of, the buildings, improvements and Realty(whether such items are leased, owned or subject to any title retaining or security instrument, or otherwise used or possessed), including,without limitation, all heating, cooling, air-conditioning, ventilating, refrigerating, plumbing, generating, power, lighting, laundry, maintenance, incinerating, lifting, cleaning, fire prevention and extinguishing, security and access control, cooking, gas, electric and communication fixtures, equipment and apparatus, all engines, motors, conduits, pipes, pumps, tanks, ducts, compressors, boilers, water heaters and furnaces, all ranges, stoves, disposers, refrigerators and other appliances, all escalators and elevators, all baths and sinks, all cabinets, partitions, mantels, built-in mirrors, window shades, blinds, screens, awnings, storm doors, windows and sash, all carpeting, underpadding, floor covering, paneling and draperies, all furnishings of public spaces, halls and lobbies, and all shrubbery and plants; all of which items (excluding art work which is not affixed to the Realty or the buildings thereon), shall be deemed part of the real property and not severable wholly or in part without material injury to the freehold; provided, however, that personal property and trade fixtures owned or supplied by tenants of the Property with the right of removal at the termination of their tenancies shall not be included within the scope of this paragraph; (d) All easements, access, air and development rights, minerals and oil, gas and other hydrocarbon substances, royalties, water, water rights and water stock, and all other rights, 2 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 hereditaments, privileges, permits, licenses, franchises and appurtenances now or hereafter belonging or in any way appertaining to the Realty; (e) All of the rents, benefits, revenues, issues, profits and income of the Property,and all present and future leases, subleases, occupancy agreements, concessions and other agreements for the occupancy or use of all or any part of the Realty, including, without limitation, licenses, all cash or security deposits (whether or not in the form of cash), advance rentals and deposits or payments of similar nature, all fees or other consideration received by Borrower in connection with the termination or modification of any lease of all or any portion of the Property, and all guaranties of tenants' or occupants' performances under such leases and agreements; SUBJECT, HOWEVER,to the assignment of rents and other property to Lender herein contained; (f) All general intangibles relating to the development or use of the Property, including without limitation all permits, licenses and franchises, all names under or by which the Property may at any time be operated or known, all rights to carry on business under any such names or any variant thereof, all trademarks, trade names, logos and good will in any way relating to the Property and all casualty insurance policies and liability insurance policies, and proceeds thereof, pertaining to the Property; (g) All water rights relating to the Property, including, without limitation, all certificated rights and all shares of water stock or other evidence of ownership of any part of the Property whether owned by Borrower alone or in common with others, and all documents of membership in any owners' or members' association or similar group having responsibility for managing or operating any part of the Property; and (h) All products and proceeds of all of the foregoing. TO SECURE THE FOLLOWING (collectively the"Secured Obligations"): (1) Payment of the sum of Fourteen Million Five Hundred Thousand and 00/100 Dollars ($14,500,000.00), with interest thereon, according to the terms and provisions of a promissory note of even date herewith, payable to Lender, or order, and made by Borrower, and all modifications, extensions, renewals and replacements thereof and any prepayment premiums, costs or expenses provided therein(collectively the"Note"); (2) Payment of all sums advanced to protect the security of this Trust Deed, together with interest thereon as herein provided; (3) Payment of all other sums which are or which may become owing and performance of all other obligations under the Loan Documents; 3 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 (4) Performance of all of Borrower's other obligations under the Loan Documents; and (5) Payment of the principal and interest on all other future loans or advances made by Lender to Borrower when the promissory note evidencing the loan or advance specifically states that it is secured by this Trust Deed, including all modifications, extensions, renewals, and replacements of any such future loan or advance. As used herein, the term "Loan Documents" means the Note, this Trust Deed, any loan agreement and Uniform Commercial Code Financing Statement filed in connection herewith,and any other instrument or document evidencing or securing the Loan or otherwise executed in connection therewith (except the Environmental Indemnity and any guaranties executed in connection with the Loan, none of which are secured by the lien of this Trust Deed), together with all modifications, extensions, renewals and replacements thereof. This Trust Deed shall not secure any Loan Document or any particular person's liabilities or obligations under any Loan Document to the extent that such Loan Document expressly states that it or such particular person's liabilities or obligations are not secured by this Trust Deed. BORROWER HEREBY REPRESENTS, WARRANTS, COVENANTS AND AGREES AS FOLLOWS: ARTICLE I REPRESENTATIONS AND WARRANTIES 1.1 Warranty of Title. Borrower represents and warrants to Lender that: (a) except as may otherwise be expressly stated in this Trust Deed, Borrower has good and marketable title in fee simple to such of the Property as is real property and is the sole and absolute owner of all other Property; (b) the Property is free from liens, encumbrances, exceptions or other charges of any kind whatsoever other than non-delinquent installments of property taxes and assessments, general and special, the exceptions, if any, listed on Schedule B of the title insurance policy issued to and approved by Lender in connection with the Loan, and any other liens, encumbrances, exceptions or charges expressly permitted by the terms of this Trust Deed (collectively, "Permitted Exceptions"), and no others, whether superior or inferior to this Trust Deed, will be created or suffered to be created by Borrower during the life of this Trust Deed without the prior written consent of Lender; (c) no default on the part of Borrower or, to the best of Borrower's knowledge, any other person exists under any of the Permitted Exceptions and all Permitted Exceptions are in full force and effect and in good standing, without modification; (d) none of the Permitted Exceptions will be modified by Borrower without Lender's prior written consent; (e) Borrower will fully comply with all the terms of the Permitted Exceptions; and (f) 4 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 that Borrower has the right to grant, mortgage, transfer, convey and assign the Property as herein provided and will forever warrant and defend the Property unto Lender against all claims and demands of any other person whomsoever, subject only to non-delinquent installments of taxes and assessments and the Permitted Exceptions. 1.2 Hazardous Substances. Except as disclosed in the Phase I Environmental Site Assessment Report by Partner Engineering and Science Inc. dated September 8, 2015 and the Subsurface Investigation Report by Partner Engineering and Science, Inc. dated December 15, 2015, Borrower represents and warrants to Lender that to the best of Borrower's knowledge following due inquiry: (i) no Hazardous Substance is currently being generated, manufactured, refined, transported, treated, stored, handled or disposed of, transferred, produced or processed on, under or about the Property, except in compliance with all applicable federal, state and local statutes, ordinances, rules, regulations and other laws; (ii) neither Borrower nor, to the best of Borrower's knowledge, any other person or entity has ever caused or permitted any Hazardous Substance to be generated, manufactured, refined, transported, treated, stored, handled or disposed of, transferred, produced or processed on, under or about the Property, except in compliance with all applicable federal, state and local statutes, ordinances, rules, regulations and other laws; (iii) Borrower has not received any notice of, nor is Borrower aware of, any actual or alleged violation with respect to the Property of any federal, state or local statute, ordinance, rule, regulation or other law pertaining to Hazardous Substances; and (iv) neither Borrower nor the Property is subject to any governmental or judicial claim, order,judgment or lien with respect to the clean-up of Hazardous Substances at or with respect to the Property. Borrower further represents and warrants to Lender that the foregoing representations and warranties contained in this Paragraph 1.2 are made after and are based upon inspection of the Property by Borrower and due inquiry by Borrower as to the prior uses of the Property. As used herein, the term "Hazardous Substance" means any hazardous, toxic or dangerous substance, waste or material which is or becomes regulated under any federal, state or local statute, ordinance, rule, regulation or other law now or hereafter in effect pertaining to environmental protection, contamination or clean up, including without limitation any substance, waste or material which now or hereafter is (A) designated as a "hazardous substance" under or pursuant to the Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), (B) defined as a "hazardous waste" under or pursuant to the Resource Conservation and Recovery Act(42 U.S.C. § 6901 et seq.), (C) defined as a "hazardous substance" in (or for purposes of) the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. § 9601 et seq.), or (D) defined or listed as a "hazardous waste," "extremely hazardous waste," "restricted hazardous waste," "infectious waste," "hazardous substance" or "hazardous material" under or pursuant to any Oregon law, statute or ordinance or any rule or regulation thereunder. 5 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 1.3 Location of Borrower. Borrower represents and warrants to Lender that Borrower is a limited liability company organized under the laws of the State of Delaware, and Borrower's exact legal name is as set forth in the first paragraph on page 1 of this Trust Deed. Borrower covenants that it will give Lender thirty (30) days' prior written notice of any act, event or occurrence which will cause the representations and/or warranties in this paragraph to become untrue in any respect. 1.4 Personal Property. Borrower represents and warrants that it owns, free and clear of liens or encumbrances, all fixtures, equipment and other items of personal property used in connection with the operation of the Property other than trade fixtures, equipment and other items of personal property owned by tenants. ARTICLE II BORROWER'S COVENANTS 2.1 Payment and Performance of Secured Obligations. Borrower agrees to pay when due all sums that are now or that may become owing on the Note, and will pay and perform all other Secured Obligations, in accordance with their terms. 2.2 Payment of Taxes,Utilities,Liens and Charges. (a) Taxes and Assessments. Except as the same may otherwise be paid under Article III, Borrower agrees to pay prior to delinquency directly to the payee thereof all taxes and assessments (including without limitation non-governmental levies or assessments such as maintenance charges, owner association dues or charges, or fees, levies or charges resulting from covenants, conditions or restrictions) levied, assessed or charged against or with respect to the Property or this Trust Deed. Upon request, Borrower shall promptly furnish to Lender all notices of amounts due under this subparagraph and all receipts evidencing such payments. Borrower may contest any such taxes or assessments by appropriate proceedings duly instituted and diligently prosecuted at Borrower's expense and Borrower shall not be obligated to pay such taxes or assessments while such contest is pending so long as (i) the Property is not thereby subjected to imminent, loss or forfeiture and, (ii) if Borrower has not provided evidence that it has deposited the entire amount assessed with the applicable governmental authority, it deposits the entire amount together with projected penalties and interest with Lender or provides other security satisfactory to Lender in its sole discretion. (b) Utilities. Borrower will pay when due all utility charges and assessments for services furnished the Property. 6 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 (c) Liens and Charges. Borrower will pay when due the claims of all persons supplying labor or materials to or in connection with the Property. Without waiving the restrictions of Paragraph 4.1 hereof, Borrower will promptly discharge any lien or other charge, whether superior or inferior to this Trust Deed, which may be claimed against the Property. Borrower may contest any mechanic's, materialmen or construction liens by appropriate proceedings supported by obtaining and maintaining in effect a bond sufficient to release the lien of record. Any such contest shall be pursued to completion by Borrower in good faith and if unsuccessful the proceeds of the bond shall be used to pay the obligation from which the lien has arisen. 2.3 Insurance. (a) Coverages Required. Borrower will keep the following insurance coverages in effect with respect to the Property: (i) Insurance against loss by fire, vandalism, malicious mischief and such other hazards as may now or hereafter be embraced by the standard "all risk" or "special form"policy of insurance (specifically excluding earthquake), in an amount equal at all times to the lesser of one hundred percent (100%) of the current replacement value of the improvements then located on the Property or the amount of the Loan. All such insurance coverage shall contain a"replacement cost endorsement",without deduction for depreciation. (ii) Flood risk insurance in the maximum amount of insurance coverage available through the National Flood Insurance Program or the full replacement cost of the buildings on the Realty, whichever is less, if the Realty is now or hereafter designated as being located within a special flood hazard area under the Flood Disaster Protection Act of 1973 and if flood insurance is available. (iii) Loss of rental value insurance and/or business interruption insurance, as follows: If all or any portion of the Property is rented or leased, loss of rental value insurance in an amount equal to twelve (12) months' aggregate gross rents from the Property as is so occupied. If all or any portion of the Property is occupied by Borrower, business interruption insurance in an amount equal to twelve (12) months' net income from such portion of the Property as is so occupied. The amount(s) of such coverage(s) shall be subject to adjustment, from time to time at Lender's request, to reflect changes in the rental and/or income levels during the term of the Loan. (iv) Commercial general public liability insurance against claims for bodily injury, death or property damage occurring on, in or about the Property (including coverage for elevators and escalators, if any, on the Property), with the coverage being in an 7 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 amount of not less than One Million and 00/100 Dollars ($1,000,000.00) combined single-limit liability coverage, or in such greater amount(s) as Lender may reasonably require and with a deductible of no greater than Twenty-Five Thousand and 00/100 Dollars$25,000.00. (v) Insurance covering the perils of terrorism and acts of terrorism. (vi) Boiler and machinery insurance covering pressure vessels, air tanks, boilers, machinery, pressure piping, heating, air conditioning and elevator and escalator equipment, provided the improvements contain equipment of such nature, and insurance against loss of occupancy or use arising from breakdown of any of such items, in such amounts as Lender may reasonably require. (vii) Demolition, increased cost of construction and contingent building laws liability insurance, if and at any time the Property constitutes a legal, non-conforming use under applicable zoning or other governmental laws. (viii) Sinkhole insurance if the Property is located in a sinkhole zone. (ix) Wind storm insurance, with a deductible of no greater than Twenty-five Thousand and 00/100 Dollars($25,000.00). (x) Insurance (excluding, however, earthquake insurance) against such similar or other hazards, casualties, liabilities and contingencies, in such forms and amounts, as Lender may from time to time reasonably require. This section sets forth Lender's minimum insurance requirements and shall not be construed as a recommendation as to the nature, type or extent of any insurance, supplements or endorsements that Borrower could or should acquire, and Borrower shall, with the assistance of its own brokers and advisors, determine whether and the extent to which any additional insurance shall be obtained. (b) Policies. Each insurance policy will be in form and content acceptable to Lender, with a deductible of no greater than Twenty-Five Thousand and 00/100 Dollars ($25,000.00) except for claims arising from water damage which shall be subject to a deductible no greater than Fifty Thousand and 00/100 Dollars ($50,000.00), be issued by a company acceptable to Lender,which company shall, among other things, be (i) duly authorized to provide such insurance in the state in which the Property is located, and (ii) rated "A" or better with a size rating of "V" or larger by A.M. Best Company's Key Rating Guide in its most recent publication of ratings (provided, however, that if A.M. Best Company changes its designations, the basis for its ratings or ceases to provide ratings, Lender shall be entitled to select replacement 8 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 ratings in the exercise of its reasonable business judgment). Each hazard insurance policy will include a mortgagee endorsement in favor of and in form acceptable to Lender, naming Lender as first mortgagee and loss payee, and which endorsement provides that the policy to which it relates will survive foreclosure of this Trust Deed. Each liability insurance policy will name Lender as an additional assured. An "agreed amount endorsement"will be included in any policy containing a co-insurance clause, and Borrower agrees that any and all co-insurance clauses and "agreed amount endorsements" must be satisfactory to Lender. If any required property insurance coverage is furnished as part of a "blanket policy," either the blanket policy will include an "agreed value endorsement" or "agreed amount endorsement," or Borrower will furnish to Lender a copy of the insurer's "statement of value" for the Property. All required policies will provide for at least thirty (30) days' written notice to Lender prior to the effective date of any cancellation and shall include a waiver of subrogation for any policy on which Borrower is a co-insured or additional insured. Borrower shall furnish to Lender (x) the complete original of each required insurance policy, or (y) a certified copy thereof(including all declaration pages, policy forms and endorsements), which shall include a signature of an authorized officer or agent of the insurer, or (z) an uncertified memorandum copy thereof (including all declaration pages, policy forms and endorsements), together with an original evidence of insurance or certificate of insurance setting forth the coverage, the limits of liability, the carrier, the policy number and the expiration date. As security for the Secured Obligations, Borrower hereby assigns to Lender all required insurance policies, together with all monies and proceeds thereof, rights thereto and all unearned premiums returnable upon cancellation (all such • assigned items constituting "Property" for purposes of this Trust Deed). (c) Payment; Renewals. Borrower shall promptly furnish to Lender all renewal notices relating to insurance policies. Except as the same may otherwise be paid under Article III, Borrower will pay all premiums on insurance policies directly to the carrier. At least fifteen (15) days prior to the expiration date of each such policy, Borrower shall furnish to Lender a renewal policy in a form acceptable to Lender, together with evidence that the renewal premium has been paid. (d) Insurance Disclosure Notice. UNLESS THE BORROWER PROVIDES LENDER WITH EVIDENCE OF INSURANCE COVERAGE AS REQUIRED BY THIS TRUST DEED, AFTER PRIOR WRITTEN NOTICE TO BORROWER, THE LENDER MAY PURCHASE INSURANCE AT THE BORROWER'S EXPENSE TO PROTECT ITS INTEREST. THIS INSURANCE MAY, BUT NEED NOT, ALSO PROTECT THE BORROWER'S INTEREST. IF THE IMPROVEMENTS BECOME DAMAGED, THE COVERAGE THE LENDER PURCHASES MAY NOT PAY ANY CLAIM THE BORROWER MAKES OR ANY CLAIM MADE AGAINST THE BORROWER. THE BORROWER MAY LATER CANCEL THIS COVERAGE BY PROVIDING THE LENDER WITH EVIDENCE THAT IT HAS OBTAINED PROPERTY COVERAGE ELSEWHERE. THE BORROWER IS 9 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-002% RESPONSIBLE FOR THE COST OF ANY INSURANCE PURCHASED BY THE LENDER. THE COST OF THIS INSURANCE MAY BE ADDED TO THE INDEBTEDNESS. IF THE COST IS ADDED TO THE INDEBTEDNESS, THE DEFAULT RATE SHALL APPLY TO THIS ADDED AMOUNT. THE EFFECTIVE DATE OF COVERAGE MAY BE THE DATE ANY PRIOR COVERAGE LAPSED OR THE DATE BORROWER FAILED TO PROVIDE PROOF OF COVERAGE. THE COVERAGE LENDER OBTAINS MAY BE CONSIDERABLY MORE EXPENSIVE THAN INSURANCE THE BORROWER MIGHT HAVE OBTAINED ON ITS OWN AND MAY NOT SATISFY ANY NEED FOR PROPERTY DAMAGE COVERAGE OR ANY MANDATORY LIABILITY INSURANCE REQUIREMENTS IMPOSED BY APPLICABLE LAW. (e) Insurance Proceeds. (i) In the event of any loss, Borrower will give prompt written notice thereof to the insurance carrier and Lender. In connection with any loss resulting in a claim exceeding One Hundred Thousand and 00/100 Dollars ($100,000.00), Borrower hereby grants Lender a power of attorney, which power of attorney is coupled with an interest and is irrevocable, to make proof of loss, to adjust and compromise any claim, to commence, appear in and prosecute, in Lender's or Borrower's name, any action relating to any claim, and to collect and receive insurance proceeds; provided,however,that Lender shall have no obligation to do so. If no Event of Default has occurred and is continuing, the immediately preceding sentence shall apply except that Lender shall not be entitled to act as Borrower's attorney-in-fact and Borrower shall be entitled to participate jointly with Lender in adjusting and compromising any claim, and appearing in any proceeding. (ii) Except as may otherwise be required by applicable law, Lender shall apply any insurance proceeds received hereunder first to the payment of the costs and expenses incurred in the collection of the proceeds and shall then apply the balance (the "Net Proceeds"), in its absolute discretion and without regard to the adequacy of its security, to: (A) The payment of indebtedness secured hereby, whether then due and payable or not. Any such application of proceeds to principal on the Note shall be without the imposition of any prepayment fee otherwise payable under the Note, but shall not extend or postpone the due dates of the installment payments under the Note or change the amounts thereof; or (B) The reimbursement of Borrower, under Lender's prescribed disbursement control procedures, for the cost of restoration or repair of the Property. Lender may, at its option, condition the reimbursement on Lender's approval of the plans and specifications of the reconstruction, contractor's cost estimates, construction budget and IO Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 schedule, architects' certificates, waivers of liens, sworn statements of mechanics and materialmen, and such other evidence of costs, percentage completion of construction, application of payments and satisfaction of liens as Lender may reasonably require. (iii) Notwithstanding the provisions of Paragraph 2.3(e)(ii) above, Lender agrees that the Net Proceeds from a loss described in this Paragraph 2.3(e) will be made available under clause (ii)(B)above to reimburse Borrower for the cost of restoration or repair of the Property,provided that each of the following conditions is satisfied: (A) At the time the proceeds are received, and all times during the restoration or repair of the Property, no event or circumstance exists which is or which with the passage of time,the giving of notice, or both will constitute an Event of Default; (B) The Net Proceeds are less than the indebtedness then secured by this Trust Deed; (C) The Net Proceeds are received more than one (1) year prior to the maturity date of the Note, including any acceleration of the maturity date by Lender if the Note gives Lender a right of acceleration; (D) Borrower gives Lender written notice within thirty (30) days after the proceeds are received that it intends to restore or repair the Property and requests that the Net Proceeds be made available therefor, and Borrower thereafter promptly commences the restoration or repair and completes the same with reasonable diligence in accordance with plans and specifications approved by Lender,which approval shall not be unreasonably withheld; (E) The Net Proceeds are sufficient, in Lender's reasonable business judgment, to restore or repair the Property substantially to its condition prior to the damage or destruction or, if in Lender's reasonable business judgment they are not, Borrower deposits with Lender funds in an amount equal to the deficiency, which funds Lender may, at its option,require be expended prior to use of the Net Proceeds; and (F) Lender receives evidence reasonably satisfactory to Lender that the Property can lawfully be restored or repaired to its condition prior to the damage and destruction and that, upon completion of the restoration or repair, the Property can be operated substantially as it was before and will produce substantially as much income from tenant leases as it did before the damage or destruction. (iv) Except to the extent, if any, that insurance proceeds are applied to payment of the Secured Obligations, nothing herein contained shall be deemed to excuse 11 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 Borrower from restoring, repairing or maintaining the Property as provided in Paragraph 2.4 below, regardless of whether there are insurance proceeds available or whether any such proceeds are sufficient in amount. (f) Transfer of Title. If the Property is sold pursuant to Article VIII or if Lender otherwise acquires title to the Property, Lender shall have all of the right,title and interest of Borrower in and to any insurance policies and unearned premiums thereon and in and to the proceeds resulting from any damage to the Property prior to such sale or acquisition. (g) Assignments as Security. As part of the security for the Secured Obligations, Borrower hereby assigns to Lender all required insurance policies, together with all monies and proceeds thereof, rights thereto and all unearned premiums returnable upon cancellation thereof(all such assigned items constituting part of the "Property" identified in the first paragraph (e) in this Trust Deed). (For the purposes of this paragraph, the word "all" is attributable to the Property only and not to other properties covered under the policies). 2.4 Preservation and Maintenance of Property; Right of Entry. (a) Preservation and Maintenance. Borrower (i) will not commit, permit to occur or suffer any waste or impairment or deterioration of the Property, (ii)will not abandon the Property, (iii) will restore or repair promptly and in a good and workmanlike manner all or any part of the Property to the equivalent of its original condition, or such other condition as Lender may approve in writing, in the event of any damage, injury or loss thereto, whether or not insurance proceeds are available to cover in whole or in part the costs of such restoration or repair, (iv) will keep the Property, including improvements, fixtures, equipment, machinery and appliances thereon, in good condition and repair and will replace fixtures, equipment, machinery and appliances of the Property when necessary to keep such items in good condition and repair, and (v)will generally operate and maintain the Property in a commercially reasonable manner. (b) Alterations. No building or other improvement on the Realty will be structurally altered, removed or demolished, in whole or in part, without Lender's prior written consent, nor will any fixture or chattel covered by this Trust Deed and adapted to the use and enjoyment of the Property be removed at any time without like consent unless actually replaced by an article of equal suitability, owned by Borrower, free and clear of any lien or security interest except such as may be approved in writing by Lender. (c) Right of Entry. Lender is hereby authorized to enter the Property, including the interior of any structures, at reasonable times and after reasonable notice (not less than 24-hour written notice and subject to the notice provisions of tenant leases, except in the event of an emergency or, provided it is permitted under the tenant leases, upon, and during the 12 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 continuance of any Event of Default), for the purpose of inspecting the Property and/or for the purpose of performing any of the acts it is authorized to perform hereunder. 2.5 Hazardous Substances. (a) No Future Hazardous Substances. Borrower will not cause or permit the Property to be used to generate, manufacture, refine, transport, treat, store, handle, dispose, transfer,produce or process any Hazardous Substance (as defined in this Trust Deed), except for de minimis quantities of substances customarily used or stored by tenants of industrial properties comparable to the Property and which are used, stored and managed in compliance with all applicable federal, state and local statutes, ordinances, rules, regulations and other laws, nor shall Borrower cause or permit, as a result of any intentional or unintentional act or omission on the part of Borrower or any tenant, subtenant or other user or occupier of the Property, a releasing, spilling, leaking, pumping, pouring, emitting, emptying or dumping of any Hazardous Substance onto the Property or any other property or into any waters, except in compliance with all such laws. Notwithstanding anything to the contrary,however, Borrower shall not cause or permit the installation, operation or presence on the Realty of any underground storage tank or system used or to be used for the storage, handling or dispensing of petroleum or any other substance regulated under the Resource Conservation and Recovery Act(42 USC § 6901 et seq.), as now or hereafter amended, or any state or local statute, ordinance, rule, regulation or other law now or hereafter in effect regulating underground storage tanks or systems. Borrower shall maintain in effect at all times during the term of the Loan an operations and management plan prepared by a licensed environmental engineer with respect to any asbestos-containing materials located within the Property. (b) Notification; Clean Up. Borrower will immediately notify Lender if Borrower becomes aware of(i) any Hazardous Substance problem or liability with respect to the Property, (ii) any actual or alleged violation with respect to the Property of any federal, state or local statute, ordinance, rule, regulation or other law pertaining to Hazardous Substances unlawfully released, stored or maintained, or (iii) any lien or action with respect to any of the foregoing. Borrower will, at its sole expense, take all actions as may be necessary or advisable for the clean-up of Hazardous Substances on or with respect to the Property, including, without limitation, all removal, containment and remedial actions in accordance with all applicable laws and in all events in a manner satisfactory to Lender, and shall further pay or cause to be paid all clean-up, administrative and enforcement costs of governmental agencies with respect to Hazardous Substances on or with respect to the Property if obligated to do so by contract or by law. (c) Verification. For the purposes of inspecting the Property to ascertain the accuracy of all representations and warranties in this Trust Deed relating to Hazardous 13 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 Substances, and the observance of all covenants contained in this Paragraph 2.5, (i) Lender is hereby authorized to enter and inspect the Property, including the interior of any structures, at reasonable times and after reasonable notice (not less than 24-hour written notice and subject to the notice provisions of tenant leases, except in the event of an emergency or, provided it is permitted under the tenant leases, upon, and during the continuance of any Event of Default); and (ii) if and at any time Hazardous Substances are being handled on the Property, Borrower shall furnish Lender with such information and documents as may be reasonably requested by Lender to confirm that such Hazardous Substances are being handled in compliance with all applicable federal, state and local statutes, ordinances, rules, regulations and other laws. Borrower shall reimburse Lender upon demand for all costs and expenses, including without limitation attorneys' fees, incurred by Lender in connection with any such entry and inspection and the obtaining of such information and documents. (d) Indemnity for Certain Matters. Borrower shall be responsible for, and indemnify, defend, and hold harmless the Lender from and against, any claim, judgment, loss, damage, demand, cost, expense or liability, known or unknown, contingent or otherwise, directly or indirectly arising out of or attributable to the use, generation, storage, release,threatened release, discharge, disposal, or presence (whether prior to or after the date of this Trust Deed) of Hazardous Substances on, in, under or about the Property including all costs and expenses incurred by the Lender, including reasonable attorneys' and consultants' fees;provided,however, that this indemnity shall be limited to those items incurred by Lender (a)prior to or following a judicial foreclosure, or (b)prior to any nonjudicial foreclosure of this Trust Deed or any deed in lieu thereof. The foregoing indemnification obligation shall be limited to the actual damages incurred by Lender, including all advances or payments paid or agreed to be paid by Lender pursuant to its rights to require environmental assessments,join or participate in any proceedings, cure the Borrower's default or enforce its remedies, (a)prior to and after any judicial foreclosure of this Trust Deed or deed delivered and accepted in lieu thereof, or(b)prior to any nonjudicial foreclosure of this Trust Deed or deed delivered and accepted in lieu thereof. The obligations of the Borrower under this Section shall be mutually exclusive of any liabilities arising after a nonjudicial foreclosure of this Trust Deed or the delivery and acceptance of a deed in lieu of such nonjudicial foreclosure, which are evidenced by the Environmental Indemnity, and are not secured hereby. 2.6 Parking. If any part of the automobile parking areas included within the Property is taken by condemnation, and before the parking areas are reduced for any other reason, Borrower will take all actions as are necessary to provide parking facilities in kind, size and location necessary to comply with all governmental zoning and other regulations and all leases. Before making any contract for substitute parking facilities, Borrower will furnish to Lender satisfactory assurance of completion thereof free of liens and in conformity with all government zoning and other regulations. 14 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 2.7 Use of Property. Borrower will comply with, and will cause all tenants, invitees and other users of the Property to comply with, all federal, state and municipal laws, ordinances, regulations and requirements of any governmental body, and all other covenants, conditions and restrictions, applicable to the Property, and pay all taxes, fees and charges in connection therewith. The Property may not be converted to a cooperative or condominium without Lender's prior written consent, which consent may be withheld in Lender's sole and absolute discretion. Borrower shall not cause or permit all or any of the Realty to be used for a gasoline station, service station or other fueling facility which in whole or in part handles, sells or distributes, gasoline, diesel fuel, gasohol or any other substance used in self-propelled motor vehicles. Unless required by applicable law or unless Lender has otherwise agreed in writing, Borrower will not allow changes in the use for which all or any part of the Property was intended at the time this Trust Deed was executed. Borrower will not initiate or acquiesce in a change in the zoning classification of the Property without Lender's prior written consent. 2.8 Commercial Purpose. The proceeds of the Loan will be used exclusively for commercial, business or investment purposes rather than for Borrower's owner's-occupied residential, personal, family or household use. This Trust Deed is not and will at all times continue not to be a residential trust deed, as that term is defined in ORS 86.705(3). 2.9 No Agricultural Use. The Realty is not used principally for agricultural or farming purposes. 2.10 Condemnation. (a) Proceedings. Borrower will promptly notify Lender of any action or proceeding relating to any condemnation or other taking (including without limitation change of grade), whether direct or indirect, of the Property or part thereof or interest therein, and Borrower will appear in and prosecute any such action or proceeding unless otherwise directed by Lender in writing. Borrower grants Lender a power of attorney, which power of attorney is coupled with an interest and is irrevocable, to commence, appear in and prosecute, in Lender's or Borrower's name, any action or proceeding relating to any such condemnation or other taking, and to settle or compromise any claim in connection with such condemnation or other taking; provided, however, that Lender shall have no obligation to do so. If no Event of Default has occurred and is continuing, the immediately preceding sentence shall apply except that Lender shall not be entitled to act as Borrower's attorney-in-fact and Borrower shall be entitled to participate jointly with Lender in adjusting and compromising any claim, and appearing in any proceeding. All awards,payments, damages, direct,consequential and otherwise, claims, and proceeds thereof, in connection with any such condemnation or other taking, or for conveyances in lieu of condemnation, are hereby assigned to Lender (all such assigned items constituting"Property" for 15 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-002% purposes of this Trust Deed); all proceeds of any such awards,payments, damages or claims shall be paid to Lender. (b) Application of Proceeds. Lender shall apply any such proceeds in the manner and upon the terms and conditions set forth in Paragraph 2.3(e)(ii) relating to the application of insurance proceeds,without regard to the provisions of Paragraph 2.3(e)(iii). 2.11 Protection of Lender's Security. Borrower will give notice to Lender of and will, at its expense, appear in and defend any action or proceeding that might affect the Property or title thereto or the interests of Lender or Trustee therein or the rights or remedies of Lender or Trustee. If any such action or proceeding is commenced or if Lender or Trustee is made a party to any such action or proceeding by reason of this Trust Deed, or if Borrower fails to perform any obligation on its part to be performed hereunder, then Lender and/or Trustee, each in its own discretion, may make any appearances, disburse any sums, make any entries upon the Property and take any actions as may be necessary or desirable to protect or enforce the security of this Trust Deed, to remedy Borrower's failure to perform its obligations (without, however, waiving any default by Borrower) or otherwise to protect Lender's or Trustee's interests. Borrower will pay all losses, damages, fees, costs and expenses, including reasonable attorneys' fees, of Lender and Trustee thus incurred. This paragraph shall not be construed to require Lender or Trustee to incur any expenses, make any appearances or take any actions. 2.12 Reimbursement of Lender's and Trustee's Expenses. All amounts disbursed by Lender and Trustee pursuant to Paragraph 2.11 or any other provision of this Trust Deed, with interest thereon, shall be additional indebtedness of Borrower secured by this Trust Deed. All such amounts shall be immediately due and payable and shall bear interest from the date of disbursement at the interest rate in effect on the Note from time to time, or at the maximum rate which may be collected from Borrower on such amounts by the payee thereof under applicable law if that is less. 2.13 Books and Records; Financial Statements. Borrower will keep and maintain at Borrower's address stated above, or such other place as Lender may approve in writing, books of accounts and records adequate to reflect correctly the results of the operation of the Property and copies of all written contracts, leases and other instruments which affect the Property. Such books, records, contracts, leases and other instruments shall be subject to examination, inspection and copying at any reasonable time upon at least 24-hour written notice to Borrower, by Lender. Borrower will furnish to Lender, within twenty (20) days after Lender's request therefor, the following documents, each certified to Lender by Borrower as being true, correct and complete: (a) a copy of all leases and other agreements for the occupancy or use of all or any part of the Property, (b) a rent roll for the Property, showing the name of each tenant, and for each tenant, the suite occupied, the number of square feet rented, the lease expiration date, the rent payable, 16 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 the date through which rent has been paid, the amount of any security deposit and the number and term of any renewal options, (c) a copy of the most recent real and personal property tax statements for the Property, (d) a copy of the most recent certificates and policies for the insurance coverages maintained under Paragraph 2.3(a) of this Trust Deed, and(e) a statement of income and expenses of the Property for the most recently ended fiscal year of Borrower. In addition, Borrower and any general partner therein will furnish to Lender, within twenty (20) days after Lender's request therefor, a complete and current financial statement, in reasonable detail and certified as correct by Borrower or such partner. Borrower and any general partner therein hereby irrevocably authorize Lender to obtain credit reports on Borrower and any such general partner on one or more occasions during the term of the Loan. 2.14 Prohibited Person Compliance. For purposes of this paragraph, "Debtor Entity" means Borrower, any guarantor of the Loan, any indemnitor under the Environmental Indemnity, and their respective affiliates (including individuals and entities). Borrower warrants, represents and covenants that no Debtor Entity is or will be an entity or person (i)that is listed in the Annex to, or otherwise subject to the provisions of, Executive Order 13224 issued on September 24, 2001 ("EO 13224"); (ii) whose name appears on the United States Treasury Department's Office of Foreign Assets Control ("OFAC") most current list of"Specifically Designated National and Blocked Persons" (which list may be published from time to time in various mediums, including. but not limited to, the OFAC website (http://www.treasury.gov/ofac); (iii) who commits, threatens to commit or supports "terrorism," as that term is defined in EO 13224; or (iv) who is otherwise affiliated with any entity or person listed above (any and all parties or persons described in subparts (i)-(iv) above are herein referred to as a "Prohibited Person"). Borrower covenants and agrees that no Debtor Entity will (A) conduct any business, nor engage in any transaction or dealing, with any Prohibited Person, including, but not limited to, the making or receiving of any contribution of funds, goods, or services, to or for the benefit of a Prohibited Person, or(B)engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in EO 13224. Upon Lender's request, Borrower further covenants and agrees to deliver to Lender any certification or other evidence as may be requested by Lender in its sole and absolute discretion, confirming that no Debtor Entity is a Prohibited Person or has taken any action described in subparts (A) and (B)above. ARTICLE III RESERVES 3.1 Deposits. If required by Lender, Borrower will, at the time of making each installment payment under the Note, deposit with Lender a sum, as estimated by Lender equal to (a) the rents under any ground lease, (b) the taxes and special assessments next due on the Property, and (c) the premiums that will next become due on insurance policies as may be 17 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 required under this Trust Deed, less all sums already deposited therefor, divided by the number of months to elapse before two (2) months prior to the date when such rents, taxes, special assessments and premiums will become delinquent. Lender may require Borrower to deposit with Lender, in advance, such other sums for other taxes, assessments, premiums, charges and impositions in connection with Borrower or the Property as Lender reasonably deems necessary to protect Lender's interests(herein"Other Impositions"). Such sums for Other Impositions shall be deposited in a lump sum or in periodic installments, at Lender's option. If required by Lender, Borrower will promptly deliver to Lender all bills and notices with respect to any rents, taxes, assessments, premiums and Other Impositions. All sums deposited with Lender under this Paragraph 3.1 are hereby pledged as security for the Secured Obligations. 3.2 Application of Deposits. All such deposited sums shall be held by Lender and applied in such order as Lender elects to pay such rents, taxes, assessments,premiums and Other Impositions or, in the Event of Default hereunder, may be applied in whole or in part, to indebtedness secured hereby. The arrangement provided for in this Article III is solely for the added protection of Lender and, except as may otherwise be required by applicable law, entails no responsibility on Lender's part beyond the allowing of due credit, without interest, for the sums actually received by it. Upon any assignment of this Trust Deed by Lender, any funds on hand shall be turned over to the assignee and any responsibility of Lender with respect thereto shall terminate. Each transfer of the Property shall automatically transfer to the transferee all rights of Borrower with respect to any funds accumulated hereunder. Upon payment in full of the Secured Obligations, Lender shall promptly refund to Borrower the remaining balance of any deposits then held by Lender without interest. 3.3 Adjustments to Deposits. If the total deposits held by Lender exceed the amount deemed necessary by Lender to provide for the payment of such rents, taxes, assessments, premiums and Other Impositions as the same fall due, then such excess shall, provided no Event of Default then exists hereunder, be credited by Lender on the next due installment or installments of such deposits. If at any time the total deposits held by Lender are less than the amount deemed necessary by Lender to provide for the payment thereof as the same fall due,then Borrower will deposit the deficiency with Lender within thirty (30) days after written notice to Borrower stating the amount of the deficiency. ARTICLE IV RESTRICTIONS ON TRANSFER OR ENCUMBRANCE 4.1 Restrictions on Transfer or Encumbrance of the Property. (a) A "Transfer" is: Any sale (by contract or otherwise), lien, encumbrance, conveyance or other transfer of the Property or any part thereof or interest therein, or any change 18 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 (whether direct or indirect) in the ownership of any stock interest in a corporate Borrower, in the ownership of any membership interest or in the manager of a limited liability company Borrower, in the ownership of any general partnership interest in any general or limited partnership Borrower, or in the ownership of any beneficial interest in any other Borrower which is not a natural person or persons(including without limitation a trust); or any change in the ownership of any such stock, membership, general partnership or other beneficial interest in any corporation, limited liability company,partnership, trust or other entity, organization or association directly or indirectly owning an interest in Borrower, or a change in the manager of a limited liability company. A change in the ownership of a limited partnership interest in a limited partnership borrower shall not be deemed a "Transfer." In addition, a lien being contested in accordance with Section 2.2(c) shall not be deemed a"Transfer." (b) The Transfers of membership interests in Borrower are permitted to(i)any existing member of Borrower or a Related Party, or (ii) to a Third Party (defined to mean any party other than a Related Party, defined in Paragraph 4.3 below) acceptable to Lender,provided that(1) at all times Arlene Schnitzer and/or Jordan Schnitzer (or entities they control) maintains no less than fifty-one percent (51%) ownership interest in Borrower, (2) Arlene Schnitzer or Jordan Schnitzer (the "Primary Owners") (or entities that they control) or another individual or entity acceptable to Lender will be the manager of Borrower with sole and absolute authority for management and control of Borrower, and (3)each of the"Special Transfer Conditions" (defined below) is met. The following are the"Special Transfer Conditions": (A) there are no defaults under the Loan Documents; (B) Borrower gives Lender at least thirty (30)days prior written notice of the proposed transfer and copies of the proposed transfer documents; (C) the managerial control of the Property remains satisfactory to Lender following the transfer; (D) the Third Party is not a Prohibited Person and is otherwise acceptable to Lender(in Lender's reasonable discretion); (E) Lender reviews and approves the transfer and proposed transfer documents in its sole and absolute discretion; 19 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 (F) Borrower pays Lender an administrative fee equal to One Thousand Five Hundred and 00/100 Dollars ($1,500.00),together with all out of pocket expenses incurred by Lender in connection with the transfer, including reasonable legal fees; and (G) Lender receives assurance acceptable to Lender, including without limitation title insurance endorsements if requested, that the lien priority of the Deed of Trust will not be affected by the transfer. (c) Lender will give its written consent to Transfers of interests in either Borrower and of interests in an entity with an ownership interest in Borrower to the transferor's spouse or lineal descendants or to an estate planning trust whose trustees and beneficiaries are the transferor or the transferor's spouse or lineal descendants, if Borrower gives Lender prior written notice of the Transfer accompanied by a Lender's One Thousand Five Hundred and 00/100 Dollars ($1,500.00) transfer review fee and any actual costs incurred by Lender. None of the foregoing conditions shall apply, however, in the case of a Transfer under any will, trust or applicable law of descent arising because of the death of an individual, so long as Lender is given prompt notice of the Transfer and the transferee. Lender's consent to any Transfer or its waiver of an Event of Default by reason of a Transfer shall not constitute a consent or waiver of any right, remedy or power accruing to Lender by reason of any subsequent Transfer. (d) For any Transfer permitted under this Trust Deed or requested by Borrower, Lender may condition its consent upon: The Property having been and assurances that it shall continue to be well maintained and managed in a manner reasonably satisfactory to Lender; Lender's approval of the Transfer terms, documents and background materials; there being no uncured Event of Default under this Trust Deed; Borrower furnishing an endorsement to Lender's title insurance policy insuring the continued validity and priority of the lien of this Trust Deed following the Transfer and such subordination agreements and other documents as may be required by Lender or its title company to issue the endorsement. Unless Lender in its sole discretion otherwise agrees in writing at that time, no Transfer shall release the transferor from any liability under the Loan Documents or the Environmental Indemnity. By accepting a Transfer, the transferee assumes any and all liability of the transferor under the Loan Documents and the Environmental Indemnity to the extent the transferor has personal liability. At Lender's request, the parties shall execute agreements, guaranties and indemnities in form and substance acceptable to Lender. Regardless whether Lender consents to a Transfer request, Borrower agrees to pay all of Lender's out-of-pocket expenses incurred in connection with any Transfer request, including without limitation title fees and attorneys' fees and costs, and Lender may condition its willingness to consider a Transfer request upon a deposit to pay for Lender's expenses. 20 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 4.2 Loan Assumption by Third Party. Lender shall consent to one sale of all (but not a portion) of the Property to, and the related and concurrent assumption of the Borrower's obligations under the Loan by, a Third Party (a "Loan Assumption"), provided that each of the following conditions is met in a manner acceptable to lender, in its sole and absolute discretion, at the time of the Loan Assumption: (a) There is no Event of Default under any of the Loan Documents, or other event or occurrence that, with the passage of time or the giving of notice or both, would be an Event of Default under any of the Loan Documents; (b) Borrower gives Lender at least thirty (30) days prior written notice of the proposed transfer and copies of the final form of the proposed transfer documents; (c) The purchaser of the Property, the financial statements, financial strength, tax returns and credit history of the purchaser and a new guarantor of the Loan (the "New Guarantor") if required by Lender, the sale agreement, transfer documents, the organizational documents and other related documents,and all aspects of the sale are satisfactory to Lender; (d) Lender reviews and approves both (i) new borrower ownership structure, and (ii) the New Guarantor, if required by Lender, and is able to confirm that none of their respective affiliated entities is or will be a Prohibited Person; (e) The purchaser evidences a history of property management satisfactory to Lender or contracts for management of the Property with a property management firm satisfactory to Lender; (0 The Lender shall have determined that the Property is at least eighty-five percent(85%)occupied by tenants who are in occupancy, open for business and paying rent; (g) If the unpaid balance of the Loan at the time of the assumption exceeds seventy percent (70%) of the sale price of the Property, a prepayment of the Loan shall be made at the time of the assumption in an amount sufficient to reduce the Loan's principal balance to seventy percent(70%)of the sales price of the Property and Borrower shall not be required to pay the applicable prepayment fee on the amount paid; (h) Lender is paid at the time of the transfer and assumption an assumption fee equal to one percent (1%) of the then outstanding Loan balance or Five Thousand and 00/100 Dollars ($5,000.00), whichever is greater, plus Lender's legal and administrative expenses, if any, incurred in connection with such sale and assumption; 21 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 (i) Borrower furnishes Lender,at Borrower's expense,with the following: (I) An endorsement to Lender's title insurance policy, in form and content satisfactory to Lender, insuring the continued validity, enforceability and priority of this Trust Deed following the sale and assumption; (ii) Such subordination agreements and other documents, in form and content satisfactory to Lender and the title company, as may be required by the title company in order to issue the endorsement; and (iii) Such documents required by Lender for the assumption of the Loan without modification by the transferee of the Property executed by the purchaser and the New Guarantor, if required by Lender. (j) At the time of the assumption, Lender may, in its sole discretion, require the continuation or the establishment, as the case may be, of a reserve account under Article III of this Trust Deed; (k) Lender shall release the transferring Borrower from liability under the Note and the Environmental Indemnity Agreement to the extent such liability arises from acts or omissions occurring after the closing of the transfer and assumption; provided, however, that where the time when any act or omission took place is in dispute,the transferring Borrower shall have the burden of proof that such act or occurrence took place after the closing of the transfer and assumption and further, that Lender may specify in its approval of a proposed Loan assumption that the Borrower remain liable under the Non-Recourse Exceptions and the Environmental Indemnity Agreement, in which case, Lender shall not be required to release that Borrower from any liability under the Non-Recourse Exceptions and the Environmental Indemnity Agreement; (1) In the event that the Loan is closed with a holdback or deposit for repairs, all repairs related to the holdback or deposit have been completed as agreed; and (m) Borrower, the Third Party, the New Guarantor, if required by Lender, and such other parties as Lender reasonably requires enter into assumption agreement and other documents as are requested by Lender in order to effect the assumption and protect the liens and other security for the Loan. 4.3 Loan Assumption by Related Party. The Lender shall from time to time, consent to a sale or transfer of all(but not a portion) of the Property to a"Related Party"who assumes the loan defined as (i) a Primary Owner, (ii) an "Immediate Family Member," defined as a Primary 22 Trust Deed Tigard'Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 Owner's spouse and/or lineal descendants or trusts established for a Primary Owner's spouse and/or lineal descendant whose beneficiaries are a Primary Owner, a Primary Owner's Spouse and/or a Primary Owner's lineal descendant, (iii)any trust established by a Primary Owner whose beneficiaries are a Primary Owner or an Immediate Family Member, or (iv) other entity that is (A) at least sixty-six percent (66%) owned (whether directly or indirectly) by one or more Primary Owners and/or Immediate Family Members, and (B) controlled by one or more Primary Owners,provided that each of the following conditions is satisfied at the time of the assumption: (a) There is no Event of Default under any of the Loan Documents, or other event or occurrence that, with the passage of time or the giving of notice or both, would be an Event of Default under any of the Loan Documents; (b) Borrower gives Lender at least thirty (30) days prior written notice of the proposed transfer and copies of the final forms of the proposed transfer documents; (c) The Primary Owners, collectively, own at least fifty-one percent (51%) of the equity interest in the Related Party,whether directly or indirectly; (d) Lender is paid at the time of the transfer (i) a transfer fee of Three Thousand Five Hundred and 00/100 Dollars ($3,500.00), plus (ii) Lender's legal fees and costs incurred in connection with the transfer and assumption; (e) Borrower furnishes to Lender, at Borrower's expense, an endorsement to Lender's title insurance policy in form and with content acceptable to Lender, insuring the continued validity, enforceability and priority of the Trust Deed following the transfer and assumption; (f) Lender reviews and approves the sale agreement, the transfer documents, and the Related Party's organizational documents; and (g) Borrower, the Related Party, all guarantors and such other parties as Lender reasonably requires enter into an assumption agreement and other documents as are requested by Lender in order to effect the assumption and protect the liens and other security for the Loan. Lender may require that the transferring Borrower remain as a Guarantor as a condition to its approval of the Related Party assumption. If Lender does not specify that requirement in its approval of the Related Party assumption, then Lender shall release the transferring Borrower from liability under the Note and the Environmental Indemnity Agreement to the extent such liability arises from acts or omissions occurring after the closing of the transfer and assumption; 23 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 provided, however, that where the time when any act or omission took place is in dispute, the transferring Borrower shall have the burden of proof that such act or occurrence took place after the closing of the transfer and assumption. ARTICLE V UNIFORM COMMERCIAL CODE SECURITY AGREEMENT 5.1 Grant to Lender. Borrower grants and conveys to Lender a continuing security interest under the Uniform Commercial Code and this Trust Deed constitutes a security agreement pursuant to the Uniform Commercial Code with respect to: (a) Any of the Property which, under applicable law, is not real property or effectively made part of the real property by the provisions of this Trust Deed, excluding any personal property that constitutes art work; provided, however, that the term "art work" does not include any building component fixture or other lien that is not or hereafter affixed to the Realty or the buildings thereon;and (b) Any and all other property now or hereafter described on any Uniform Commercial Code Financing Statement naming Borrower as Debtor and Lender as Secured Party and affecting property in any way connected with the use and enjoyment of the Property(any and all such other property constituting"Property"for purposes of this Trust Deed); and Borrower hereby grants Lender a security interest in all property described in clauses (a)and (b) above as security for the Secured Obligations. Borrower and Lender agree, however, that neither the foregoing grant of a security interest nor the filing of any such financing statement shall ever be construed as in any way derogating from the parties' stated intention that everything used in connection with the production of income from the Property or adapted for use therein or which is described or reflected in this Trust Deed is and at all times shall be regarded for all purposes as part of the real property. 5.2 Lender's Rights and Remedies. With respect to Property subject to the foregoing security interest, Lender has all of the rights and remedies (i) of a secured party under the Uniform Commercial Code, (ii) provided herein, including without limitation the right to cause such Property to be sold by Trustee under the power of sale granted by this Trust Deed, and (iii) provided by law. In exercising its remedies, Lender may proceed against the items of real property and any items of personal property separately or together and in any order whatsoever, without in any way affecting the availability of Lender's remedies. Upon demand by Lender following an Event of Default hereunder, Borrower will assemble any items of personal property and make them available to Lender at the Property, a place which is hereby deemed to be reasonably convenient to both parties. Lender shall give Borrower at least five (5) days' prior 24 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 written notice of the time and place of any public sale or other disposition of such Property or of the time of or after which any private sale or any other intended disposition is to be made. Any person permitted by law to purchase at any such sale may do so. Such Property may be sold at any one or more public or private sales as permitted by applicable law. All expenses incurred in realizing on such Property shall be borne by Borrower. 5.3 Fixture Filing. This Trust Deed covers goods which are or are to become fixtures on the Realty, and this Trust Deed constitutes and is filed as a "fixture filing" (as that term is defined in the Oregon Uniform Commercial Code, upon such of the Property which is or may become fixtures. The exact names of Borrower, as "Debtor" and Lender as "Secured Party" and their respective addresses are set forth on page 1 of this Trust Deed. Borrower has an interest of record in the Realty. The organizational number of Borrower is 3553529. 5.4 Lender's Authorization to File Financing Statement; Borrower Cooperation. Borrower hereby authorizes Lender to file one or more Uniform Commercial Code Financing Statements with respect to the Property. Borrower covenants and agrees that it will promptly furnish to Lender, upon Lender's request, such information as may be required in order for Lender to do so. ARTICLE VI ASSIGNMENT OF RENTS AND LEASES; LEASES OF PROPERTY; APPOINTMENT OF RECEIVER; LENDER IN POSSESSION 6.1 Assignment of Rents and Leases. As security for the Secured Obligations, Borrower hereby assigns and transfers to Lender all right, title and interest of Borrower in and to (a)any and all present and future leases and other agreements for the occupancy or use of all or any part of the Property, and any and all extensions, renewals and replacements thereof (collectively "Leases"), (b) all cash or security deposits (whether or not in the form of cash), advance rentals and deposits, all fees of other consideration received by Borrower in connection with the termination or modification of any Lease of all or a portion of the Property or other payments of similar nature under the Leases, (c) any and all guaranties of tenants' or occupants' performances under any and all Leases, and(d)all rents, issues,profits and revenues(collectively "Rents") now due or which may become due or to which Borrower may now or shall hereafter become entitled or may demand or claim (including Rents coming due during any redemption period), arising or issuing from or out of any and all Leases, including without limitation minimum,additional,percentage and deficiency rents and liquidated damages. 6.2 Collection of Rents. Prior to written notice given by Lender to Borrower of an Event of Default hereunder, Borrower shall collect and receive all Rents of the Property as trustee for the benefit of Lender and Borrower, and apply the Rents so collected first to the 25 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 payment of taxes, assessments and other charges on the Property prior to delinquency, second to the cost of insurance, maintenance and repairs required by the terms of this Trust Deed, third to the costs of discharging any obligation or liability of Borrower under the Leases, and fourth to the indebtedness secured hereby, with the balance, if any, so long as no such Event of Default has occurred, to the account of Borrower. Upon delivery of written notice by Lender to Borrower of an Event of Default hereunder and stating that Lender exercises its rights to the Rents, and without the necessity of Lender entering upon and taking and maintaining full control of the Property in person, by agent or by a court-appointed receiver, Lender shall immediately be entitled to possession of all Rents from the Property as the same become due and payable, including without limitation Rents then due and unpaid, and all such Rents shall immediately upon delivery of such notice be held by Borrower as trustee for the benefit of Lender only. Upon delivery of such written notice by Lender, Lender may make written demand upon all or some of the tenants and occupants of the Property to pay all Rents to Lender, and Borrower hereby agrees that each such tenant and occupant shall have no liability to inquire further as to the existence of a default by Borrower. Upon written demand by Lender, Borrower hereby agrees to direct each tenant or occupant of the Property to pay all Rents to Lender. Payments made to Lender by tenants or occupants shall, as to such tenants and occupants, be in discharge of the payors' obligations to Borrower. Lender may exercise, in Lender's or Borrower's name, all rights and remedies available to Borrower with respect to collection of Rents. Nothing herein contained shall be construed as obligating Lender to perform any of Borrower's obligations under any of the Leases. 6.3 Borrower's Representations and Warranties. Borrower represents and warrants to Lender that Borrower has not executed and will not execute any other assignment of said Leases or Rents, that Borrower has not performed and will not perform any acts and has not executed and will not execute any instrument which would prevent Lender from exercising its rights under this Article VI, and that at the time of execution of this Trust Deed there has been no anticipation or prepayment of any of the Rents of the Property for more than two (2) months prior to the due dates thereof. Borrower further represents and warrants to Lender that all existing Leases are in good standing and there is no default thereunder, whether by Borrower or lessee, nor to Borrower's knowledge any event or condition which, with notice or the passage of time or both, would be a default thereunder. 6.4 Leases of the Property. Borrower will comply with and observe Borrower's obligations as landlord under all Leases and will do all that is necessary to preserve all Leases in force and free from any right of counterclaim, defense or setoff. Without Lender's written consent, Borrower will not collect or accept payment of any Rents of the Property more than two (2)months prior to the due dates thereof,will not enter into,execute, modify or extend any Lease now existing or hereafter made providing for a term (assuming that all renewal options, if any, are exercised) of more than five (5) years remaining unless the area demised by the Lease is less 26 'I'rust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 than twenty-five percent (25%) of the net rentable area of the building(s) at the Property. Without Lender's written consent, Borrower will not surrender or terminate any Lease now existing or hereafter made providing a term (assuming that all renewal options, if any, are exercised) of more than five (5) remaining years nor will Borrower surrender or terminate in any single twelve-month period Leases demising more than twenty-five percent (25%) of the aggregate total net rentable area. Each Lease of the Property will be subordinate to the lien of this Trust Deed, unless Lender elects that the Lease shall be superior to this Trust Deed, and each tenant shall execute an appropriate subordination or attornment agreement as may be required by Lender. To the extent required by Lender, each tenant shall execute an estoppel certificate and acknowledge receipt of a notice of the assignment to Lender of its Lease, all satisfactory in form and content to Lender. Without Lender's written consent, Borrower will not request or consent to the subordination of any Lease to any lien subordinate to this Trust Deed. 6.5 Lender in Possession;Appointment of Receiver. Upon the occurrence of an Event of Default hereunder, Lender may, in person, by agent or by a court-appointed receiver, regardless of the adequacy of Lender's security, enter upon and take and maintain full control of the Property in order to perform all acts necessary and appropriate for the operation and maintenance thereof in the same manner and to the same extent as Borrower could do the same, including without limitation the execution, enforcement,cancellation and modification of Leases, the collection of all Rents of the Property, the removal and eviction of tenants and other occupants, the making of alterations and repairs to the Property, and the execution and termination of contracts providing for management or maintenance of the Property, all on such terms as are deemed best by Lender to protect the security of this Trust Deed. From and after the occurrence of any such Event of Default, if any owner of the Property shall occupy the Property or part thereof such owner shall pay to Lender in advance on the first day of each month a reasonable rental for the space so occupied, and upon failure so to do Lender shall be entitled to remove such owner from the Property by any appropriate action or proceedings. Following an Event of Default hereunder, Lender shall be entitled (without notice and regardless of the adequacy of Lender's security and as a matter of strict right) to the appointment of a receiver, Borrower hereby consenting to the appointment of such receiver, and the receiver shall have, in addition to all the rights and powers customarily given to and exercised by such receivers (including, without limitation, the power to collect rents), all the rights and powers granted to Lender in this Article VI. Lender or the receiver shall be entitled to receive a reasonable fee for so managing the Property. 6.6 Application of Rents. All Rents collected subsequent to delivery of written notice by Lender to Borrower of an Event of Default hereunder shall be applied first to the costs, if any, of taking control of and managing the Property and collecting the Rents, including without limitation attorneys' fees, receiver's fees, premiums on receiver's bonds, costs of maintenance and repairs to the Property,premiums on insurance policies,taxes, assessments and other charges 27 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 on the Property, and the costs of discharging any obligation or liability of Borrower under the Leases, and then to the indebtedness secured hereby. Lender or the receiver shall be liable to account only for those Rents actually received. Lender shall not be liable to Borrower, anyone claiming under or through Borrower or anyone having an interest in the Property by reason of anything done or left undone by Lender under this Article VI. 6.7 Deficiencies. To the extent, if any, that the costs of taking control of and managing the Property, collecting the Rents, and discharging obligations and liabilities of Borrower under the Leases,exceed the Rents of the Property, the excess sums expended for such purposes shall be indebtedness secured by this Trust Deed. Such excess sums shall be payable upon demand by Lender and shall bear interest from the date of disbursement at the default rate of interest stated in the Note, or the maximum rate which may be collected from Borrower therefor under applicable law if that is less. 6.8 Lender Not Mortgagee in Possession. Nothing herein shall constitute Lender a "mortgagee in possession" prior to its actual entry upon and taking possession of the Property. Entry upon and taking possession by a receiver shall not constitute possession by Lender. 6.9 Enforcement. Lender may enforce this assignment without first resorting to or exhausting any security or collateral for the indebtedness. As used in this Article VI, the word "lease" shall mean "sublease" if this Trust Deed is on a leasehold. This assignment shall terminate at such time as this Trust Deed ceases to secure payment of indebtedness held by Lender. ARTICLE VII EVENTS OF DEFAULT 7.1 Events of Default. The occurrence of any one or more of the following shall constitute an Event of Default hereunder: (a) Borrower's failure to pay any amount outstanding under the Note on the Maturity Date(as defined in the Note). (b) Borrower's failure to make any other payment when due under the Note, this Trust Deed or any of the other Loan Documents, followed by Borrower's failure to make such payment within ten (10) days after written notice thereof given to Borrower by Lender; provided, however, that Lender shall not be obligated to give Borrower written notice prior to exercising its remedies with respect to such default if Lender had previously given Borrower during the previous twelve (12) month period a notice of default for failure to make a payment of similar type. 28 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 (c) Borrower's failure to perform any other covenant, agreement or obligation under the Note, this Trust Deed or any of the other Loan Documents, followed by Borrower's failure to cure such default within thirty (30) days after written notice thereof given to Borrower by Lender (or if such cure cannot be completed within such thirty (30) day period through the exercise of diligence, the failure by Borrower to commence the required cure within such thirty (30) day period and thereafter to continue the cure with diligence and to complete the cure within ninety(90)days following Lender's notice of default). (d) Borrower files, or there is filed against Borrower (and such involuntary filing is not dismissed within ninety (90) days), or any portion of the Property becomes the subject of, a petition in bankruptcy or action seeking reorganization, arrangement, liquidation, dissolution or similar relief under any bankruptcy or other federal or state insolvency or other law relating to relief from indebtedness, or a receiver, trustee or liquidator is appointed with respect to Borrower, or any portion of the Property. (e) A decree or order is entered for the appointment of a trustee, receiver or liquidator for Borrower or Borrower's property, and such decree or order is not vacated within forty-five (45)days after the date of entry. (0 Borrower commences any proceeding for dissolution or liquidation; or any such proceeding is commenced against Borrower and the proceeding is not dismissed within forty-five (45)days after the date of commencement. (g) Borrower makes an assignment for the benefit of its creditors, or admits in writing its inability to pay its debts generally as they become due. (h) There is an attachment, execution or other judicial seizure of any portion of Borrower's assets and such seizure is not discharged within ten(10)days. (i) Any representation or disclosure made to Lender by Borrower or any guarantor in connection herewith proves to be materially false or misleading when made, whether or not that representation or disclosure is contained in the Loan Documents. (j) Any Transfer (as defined in Section 4.1 above) made without Lender's prior written consent. (k) The death or dissolution of any Guarantor of the Loan unless within thirty (30) days of the death or dissolution of such Guarantor, Borrower fails to provide a new replacement guarantor reasonably acceptable to Lender who executes Lender's standard form 29 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 guaranty agreement and assumes all of the deceased or dissolved Guarantor's obligations under the Loan Documents. Lender will be deemed to be reasonable in refusing to approve a proposed replacement guarantor whose creditworthiness, net worth and liquidity is less than that of the original Guarantor at the time of the closing of the Loan. 7.2 Form of Notice. At Lender's option, any written notice of default required to be given to Borrower under Paragraph 7.1 may be given in the form of a statutory notice of default under the laws of the State of Oregon relating to non judicial foreclosures of deeds of trust. ARTICLE VIII REMEDIES 8.1 Acceleration Upon Default; Additional Remedies. Upon the occurrence of an Event of Default hereunder, Lender may, at its option and without notice to or demand upon Borrower,take any one or more of the following actions: (a) Declare any or all indebtedness secured by this Trust Deed to be due and payable immediately. (b) Bring a court action to enforce the provisions of this Trust Deed or any of the indebtedness or obligations secured by this Trust Deed,or to foreclose this Trust Deed. (c) Lender or Trustee may also cause any or all of the Property to be sold under the power of sale granted by this Trust Deed in any manner permitted by applicable law. For any sale under the power of sale granted by this Trust Deed, Lender or Trustee shall record and give all notices required by law and then, upon the expiration of such time as is required by law, Trustee may sell the Property upon any terms and conditions specified by Lender and permitted by applicable law. Trustee may postpone any sale by public announcement at the time and place noticed for the sale. If the Property includes several lots or parcels, Lender in its discretion may designate their order of sale or may elect to sell all of them as an entirety. The Property, real, personal and mixed, may be sold in one parcel. To the extent any of the Property sold by Trustee is personal property, Trustee shall be acting as the agent of Lender in selling such Property. Any person permitted by law to do so may purchase at any sale. Upon any sale, Trustee will execute and deliver to the purchaser or purchasers a deed or deeds conveying the Property sold, but without any covenant or warranty, express or implied, and the recitals in the Trustee's deed showing that the sale was conducted in compliance with all the requirements of law shall be prima facie evidence of such compliance and conclusive evidence thereof in favor of bona fide purchasers and encumbrances for value. 30 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 (d) In the event of any foreclosure, to the extent permitted by applicable law, Lender will be entitled to a judgment which will provide that if the foreclosure sale proceeds are insufficient to satisfy the judgment, execution may issue for any amount by which the unpaid balance of the obligations secured by this Trust Deed exceeds the net sale proceeds payable to Lender. (e) With respect to all or any part of the Property that constitutes personalty, except works of art excluded from the definition of the Property, Lender shall have all rights and remedies of secured party under the Uniform Commercial Code. (f) Lender shall have the right to have a receiver appointed, on an ex parte basis, if available, to take possession of any or all of the Property, with the power to protect and preserve the Property, to operate the Property preceding foreclosure or sale,to collect all the rents and revenues from the Property and apply the proceeds, over and above cost of the receivership, against the sums due under this Trust Deed, and to exercise all of the rights with respect to the Property described in Section 6 above. The receiver may serve without bond if permitted by law. Lender's right to the appointment of a receiver shall exist whether or not apparent value of the Property exceeds the sums due under this Trust Deed by a substantial amount. Employment by Lender shall not disqualify a person from serving as a receiver. (g) In the event Borrower 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 the occurrence of an Event of Default, Borrower shall become a tenant at will of Lender or the purchaser of the Property and shall pay a reasonable rental for use of the Property while in Borrower's possession. (h) Trustees and Lender shall have any other right or remedy provided in this Trust Deed, the Note, or any other Loan Document or instrument delivered by Borrower in connection therewith, or available at law, in equity or otherwise. (i) Lender shall have all the rights and remedies set forth in Sections 5 and 6. 8.2 Sale of the Property. In exercising its rights and remedies, the Trustees or Lender may, at Lender's sole discretion, cause all or any part of the Property to be sold as a whole or in parcels, and certain portions of the Property may be sold without selling other portions. Lender may bid at any public sale on all or any portion of the Property. 8.3 Notice of Sale. Lender shall give Borrower reasonable notice of the time and place of any public sale of any 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 31 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 notice given in accordance with applicable law, including notices given in the manner and at the times required for notices in a nonjudicial foreclosure. 8.4 Waiver; Election of Remedies. A waiver by either party of a breach of a provision of this Trust Deed shall not constitute a waiver of or prejudice the party's right otherwise to demand strict compliance with that provision or any other provision. Election by Lender to pursue any remedy shall not exclude pursuit of any other remedy, and all remedies of Lender under this Trust Deed are cumulative and not exclusive. An election to make expenditures or take action to perform an obligation of Borrower shall not affect Lender's right to declare a default and exercise its remedies under this Trust Deed. 8.5 Waivers; Releases. To the fullest extent permitted by law, Borrower hereby irrevocably and unconditionally waives and releases (i) all benefits that might accrue to Borrower by any present or future laws exempting the Property from attachment, levy or sale on execution or providing for any appraisement, valuation, stay of execution, exemption from civil process, redemption or extension of time for payment; (ii) all notices of any Event of Default (except as may be specifically provided for under the terms hereof), presentment, demand, notice of intent to accelerate, notice of acceleration and any other notice of Lender's or Trustees' election to exercise or the actual exercise of any right, remedy or recourse provided for under the Loan Documents; (iii) any right to appraisal or marshalling of assets or a sale in inverse order of alienation; (iv) the exemption of homestead; (v) all rights of reinstatement and redemption; and (vi) the administration of estates and decedents, or other matter to defeat, reduce or affect the right of Lender under the terms of this Trust Deed to sell the Property for the collection of the Secured Obligations secured hereby (without any prior or different resort for collection) or the right of Lender, under the terms of this Trust Deed, to receive the payment of the Secured Obligations out of the proceeds of the sale of the Property in preference to every other person or claimant whatever(only reasonable expenses of such sale being first deducted). 8.6 Application of Sale Proceeds. Except as may otherwise be required by applicable law,the proceeds of any sale under this Trust Deed will be applied in the following manner: FIRST: Payment of the costs and expenses of the sale, including without limitation Trustee's fees, legal fees and disbursements, title charges and transfer taxes, and payment of all expenses, liabilities and advances of Trustee, together with interest on all advances made by Trustee from date of disbursement at the applicable interest rate under the Note from time to time or at the maximum rate permitted to be charged by Trustee under the applicable law if that is less. SECOND: Payment of all sums expended by Lender under the terms of this Trust Deed and not yet repaid, together with interest on such sums from date of disbursement at the 32 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 applicable interest rate under the Note from time to time or the maximum rate permitted by applicable law if that is less. THIRD: Payment of all other indebtedness secured by this Trust Deed in any order that Lender chooses. FOURTH: The remainder, if any,to the person or persons legally entitled to it. 8.7 Waiver of Order of Sale and Marshalling. Lender shall have the right to determine the order in which any and all portions of the Secured Obligations are satisfied from the proceeds realized upon the exercise of any remedies provided herein. Borrower, any person who consents to this Trust Deed and any person who now or hereafter acquires a security interest in the Property hereby waives, to the extent permitted by law, any and all right to require marshalling of assets in connection with the exercise of any of the remedies provided herein or to direct the order in which any of the Property will be sold in the event of any sale under this Trust Deed. 8.8 Non-Waiver of Defaults. The entering upon and taking possession of the Property, the collection of Rents or the proceeds of fire and other insurance policies or compensation or awards for any taking or damage of the Property, and the application or release thereof as herein provided, shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. 8.9 Expenses During Redemption Period. If this Trust Deed is foreclosed through court action and the Property sold at a foreclosure sale,the purchaser may during any redemption period allowed, make such repairs or alterations on the Property as may be reasonably necessary for the proper operation, care, preservation, protection and insuring thereof. Any sums so paid together with interest thereon from the time of such expenditure at the default rate of interest stated in the Note or the highest lawful rate if that is less shall be added to and become a part of the amount required to be paid for redemption from such sale. 8.10 Foreclosure Subject to Tenancies. Lender shall have the right at its option to foreclose this Trust Deed subject to the rights of any tenant or tenants of the Property. 8.11 Evasion of Prepayment Terms. If an Event of Default hereunder has occurred and is continuing, a tender of payment of the indebtedness secured hereby at any time prior to or at a judicial or nonjudicial foreclosure sale of the Property by Borrower or anyone on behalf of Borrower shall constitute an evasion of the prepayment terms of the Note and shall constitute voluntary prepayment thereunder and any such tender shall to the extent permitted by law include the additional payment required under the prepayment privilege, if any, contained in the Note or, 33 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 if at that time there is no prepayment privilege, then such payment shall to the extent permitted by law include an additional payment of five percent(5%)of the then principal Loan balance. 8.12 Remedies Cumulative. To the extent permitted by law, every right and remedy provided in this Trust Deed is distinct and cumulative to all other rights or remedies under this Trust Deed or afforded by law or equity or any other agreement between Lender and Borrower, and may be exercised concurrently, independently or successively, in any order whatsoever. Lender may exercise any of its rights and remedies at its option without regard to the adequacy of its security. 8.13 Lender's and Trustee's Expenses. Borrower will pay all of Lender's and Trustee's expenses incurred in any efforts to enforce any terms of this Trust Deed and also in connection with any Borrower requests,whether or not there is any default under the Loan Documents or any suit is filed, including without limitation legal fees and disbursements, foreclosure costs and title charges. All such sums, with interest thereon, shall be additional indebtedness of Borrower secured by this Trust Deed. Such sums shall be immediately due and payable and shall bear interest from the date of disbursement at the default rate of interest stated in the Note, or the maximum rate which may be collected from Borrower under applicable law if that is less. ARTICLE IX GENERAL 9.1 Application of Payments. Except as applicable law or this Trust Deed may otherwise provide, all payments received by Lender under the Note or this Trust Deed shall be applied by Lender in the following order of priority: (a) Lender's and Trustee's costs and expenses incurred in any efforts to enforce any terms of this Trust Deed; (b) amounts payable to Lender by Borrower under Article III for reserves; (c) interest and late charges payable on the Note; (d) interest payable on advances made to protect the security of this Trust Deed; (e) principal of such advances; (f)principal of the Note; and(g) any other sums secured by this Trust Deed in such order as Lender, at its option, may determine; provided, however, that Lender may, at its option, apply any such payments received to interest on and principal of advances made to protect the security of this Trust Deed prior to applying such payments to interest on or principal of the Note. 9.2 Reconveyance. Upon payment of all sums secured by this Trust Deed, Lender shall request Trustee to reconvey the Property and shall surrender this Trust Deed and all notes evidencing indebtedness secured by this Trust Deed to Trustee. Trustee shall reconvey the Property without warranty to the person or persons legally entitled thereto. The grantee in any reconveyance may be described as the "person or persons legally entitled thereto," and the 34 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 recitals therein of any matters or facts shall be conclusive proof of the truthfulness thereof. Such person or persons shall pay Trustee's reasonable costs incurred in so reconveying the Property. 9.3 Successor Trustee. Lender may remove Trustee or any successor Trustee at any time or times and appoint a successor Trustee by recording a written substitution in the county where the Property is located, or in any other manner permitted by law. Without conveyance of the Property, the successor trustee shall succeed to all the title, power and duties conferred upon the Trustee herein and by applicable law. 9.4 Lender's Powers. Without affecting the liability of any person for payment or performance of the Secured Obligations, or any of Lender's rights or remedies, or the priority of this Trust Deed, Lender, at its option, may extend the time for payment of the indebtedness secured hereby or any part thereof, reduce payment thereon, release anyone liable on any of said indebtedness, accept a renewal note or notes therefor, modify the terms and time of payment of the indebtedness, release the lien of this Trust Deed on any part of the Property, take or release other or additional security, release or reconvey or cause to be released or reconveyed all or any part of the Property, or consent and/or cause Trustee to consent to the making of any map or plat of the Property, consent or cause Trustee to consent to the granting of any easement or creating any restriction on the Property, or join or cause Trustee to join in any subordination or other agreement affecting this Trust Deed or the lien or charge hereof. Borrower shall pay Lender a reasonable service charge, together with such title insurance premiums and attorneys' fees as may be incurred at Lender's option,for any such action if taken at Borrower's request. 9.5 Subrogation. Lender shall be subrogated for further security to the lien, although released of record, of any and all encumbrances discharged, in whole or in part, by the proceeds of the Loan or any other indebtedness secured hereby. 9.6 Limitation on Interest and Charges. Interest, fees and charges collected or to be collected in connection with the indebtedness secured hereby shall not exceed the maximum, if any, permitted by any applicable law. If any such law is interpreted so that said interest, fees and/or charges would exceed any such maximum and Borrower is entitled to the benefit of such law, then: (a) such interest, fees and/or charges shall be reduced by the amount necessary to reduce the same to the permitted maximum; and (b) any sums already paid to Lender which exceeded the permitted maximum will be refunded. Lender may choose to make the refund either by treating the payments, to the extent of the excess, as prepayments of principal or by making a direct payment to the person(s) entitled thereto. No prepayment premium shall be assessed on prepayments under this paragraph. The provisions of this paragraph shall control over any inconsistent provision of this Trust Deed or the Note or any other Loan Documents. 35 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 9.7 Additional Documents: Power of Attorney. Borrower, from time to time, will execute, acknowledge and deliver to Lender upon request, and hereby grants Lender a power of attorney, which power of attorney is coupled with an interest and is irrevocable, to execute, acknowledge, deliver and if appropriate file and record, such security agreements, assignments for security purposes, assignments absolute, financing statements, affidavits, certificates and other documents, in form and substance satisfactory to Lender, as Lender may request in order to perfect, preserve, continue, extend or maintain the assignments herein contained, the lien and security interest under this Trust Deed, and the priority thereof. Borrower will pay to Lender upon request therefor all costs and expenses incurred in connection with the preparation, execution, recording and filing of any such document. Borrower shall execute such further documents and do any and all such further things, including, but not limited to, correcting any errors or omissions in the Loan Documents, as may be necessary to implement and carry out the intent of this Trust Deed. 9.8 Waiver of Statute of Limitations. To the full extent Borrower may do so, Borrower hereby waives the right to assert any statute of limitations as a defense to the enforcement of the lien of this Trust Deed or to any action brought to enforce the Note or any other obligation secured by this Trust Deed. 9.9 Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising any right or remedy hereunder, or otherwise afforded by applicable law, shall not be a waiver of or preclude the exercise of any right or remedy, and no waiver by Lender of any particular default by Borrower shall constitute a waiver of any other default or of any similar default in the future. Without limiting the generality of the foregoing, the acceptance by Lender of payment of any sum secured by this Trust Deed after the due date thereof shall not be a waiver of Lender's right to either require prompt payment when due of all other sums so secured or to declare a default for failure to make prompt payment. The procurement of insurance or the payment of taxes or other liens or charges by Lender shall not be a waiver of Lender's right to accelerate the maturity of the indebtedness secured by this Trust Deed, nor shall Lender's receipt of any awards, proceeds or damages under Paragraphs 2.3 and 2.10 hereof operate to cure or waive Borrower's default in payment of sums secured by this Trust Deed. 9.10 Modifications and Waivers. This Trust Deed cannot be waived, changed, discharged or terminated orally, but only by an instrument in writing signed by the party against whom enforcement of any waiver,change, discharge or termination is sought. 9.11 Notice. Except as applicable law may otherwise require, all notices and other communications shall be in writing and shall be deemed given when delivered by personal service or when mailed, by certified or registered mail, postage prepaid, addressed to the address set forth at the beginning of this Trust Deed. Any party may at any time change its address for 36 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 such purposes by delivering or mailing to the other parties hereto as aforesaid a notice of such change. 9.12 Governing Law; Severability; Captions. This Trust Deed shall be governed by the laws of the State of Oregon. If any provision or clause of this Trust Deed conflicts with applicable law, such conflicts shall not affect other provisions or clauses hereof which can be given effect without the conflicting provision, and to this end the provisions hereof are declared to be severable. The captions and headings of the Paragraphs and articles of this Trust Deed are for convenience only and are not to be used to interpret or define the provisions hereof. 9.13 Counterparts. This Trust Deed may be executed in any number of counterparts, each of which shall be an original,but all of which together shall constitute but one instrument. 9.14 Definitions. As used herein: the term "Borrower" means the Borrower herein named,together with any subsequent owner of the Property or any part thereof or interest therein; the term "Trustee" means the Trustee herein named, together with any successor Trustee;and the term "Lender" means the Lender herein named, together with any subsequent owner or holder of the Note or any interest therein, including pledgees, assignees and participants. 9.15 Successors and Assigns; Joint and Several Liability; Agents. This Trust Deed shall bind and inure to the benefit of the parties hereto and their respective heirs, devisees, legatees, administrators, executors, successors and assigns, subject to the provisions of Article IV hereof. Each person executing this Trust Deed as Borrower shall be jointly and severally liable for all obligations of Borrower hereunder. In exercising any rights hereunder or taking actions provided for herein, Lender and Trustee may act through their respective employees, agents or independent contractors as authorized by Lender and Trustee. 9.16 Number; Gender. This Trust Deed shall be construed so that wherever applicable the use of the singular number shall include the plural number, and vice versa, and the use of any gender shall be applicable to all genders. 9.17 Attorneys' Fees. As used in this Trust Deed, the terms "legal fees" and "attorney fees" shall include without limitation attorneys' fees incurred at or in preparation for any trial appeal or review or in any proceeding under any present or future federal bankruptcy act or state receivership law. 9.18 Indebtedness May Exceed Note's Face Amount. The Borrower's successors or assigns are hereby placed on notice that the Note contains late charge, prepayment and other provisions which may result in the outstanding principal balance exceeding the face amount of the Note. 37 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 9.19 Time. Time is of the essence in connection with all obligations of Borrower herein. 9.20 Request for Notice. Borrower hereby requests that a copy of any notice of default and a copy of any notice of sale given pursuant to this Trust Deed be mailed to Borrower at the address set forth at the beginning of this Trust Deed. 9.21 Waiver of Jury Trial. TO THE EXTENT PERMITTED BY LAW, LENDER AND BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN ANY ACTION, WHETHER ARISING IN CONTRACT OR TORT, BY STATUTE OR OTHERWISE, IN ANY WAY RELATED TO THIS TRUST DEED. BORROWER ACKNOWLEDGES THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR LENDER'S EXTENDING CREDIT TO BORROWER, THAT THE LENDER WOULD NOT HAVE EXTENDED CREDIT WITHOUT THIS JURY TRIAL WAIVER, THAT BORROWER HAS BEEN REPRESENTED BY AN ATTORNEY OR HAS HAD AN OPPORTUNITY TO CONSULT WITH AN ATTORNEY IN CONNECTION WITH THIS JURY TRIAL WAIVER TO UNDERSTAND THE LEGAL EFFECT OF THIS WAIVER, AND NO WAIVER OR LIMITATION OF LENDER'S RIGHTS UNDER THIS PARAGRAPH SHALL BE EFFECTIVE UNLESS IN WRITING AND MANUALLY SIGNED ON LENDER'S BEHALF. 9.22 Service of Process. The Borrower hereby appoints Jeffrey Nudelman at the following address as its agent for receipt of service of process: Harsch Investment Properties Management, LLC 1121 SW Salmon Street, Suite 500 Portland, OR 97205 Attn: Jeffrey Nudelman The Borrower agrees that such service upon receipt (i) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and(ii) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it. Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt furnished by the United States Postal Service or any reputable commercial delivery service. 9.23 Forum Selection. The Borrower agrees that the sole and exclusive forum for the determination of any action relating to the validity and enforceability of the Note,this Trust Deed and the other Loan Documents, and any other instruments securing the Note shall be either in an 38 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 appropriate court of the State of Oregon or the applicable United States District Court. To the fullest extent permitted by applicable law, the Borrower irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. ARTICLE X SPECIAL PROVISIONS BORROWER HEREBY DECLARES AND ACKNOWL- EDGES THAT BORROWER HAS RECEIVED, WITHOUT CHARGE,A TRUE COPY OF THIS TRUST DEED. UNDER OREGON LAW, MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY LENDER CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL, FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED BY THE LENDER TO BE ENFORCEABLE. (Signatures follow on next page) 39 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 IN WITNESS WHEREOF, Borrower has executed this Trust Deed as of the day and year first above written. BORROWER: SN INVESTMENT PROPERTIES, LLC, a Delaware limited liability company By: Harsch Investment Properties Management, LLC, a Delaware limited liability company Its Manager By: Printed gVAN J IRWIN Title: SVP/CHIEF FTNAN(:TAT,OFFICER Address: 1121 SW Salmon Street, Suite 500 Portland, Oregon Attn: Finance Department 40 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 STATE OF OREGON ) )ss. COUNTY OF MULTNOMAH ) This instrument was acknowledged before me on December aFP 2015, by Ryan J. Irwin , SVP/Chief Finanical Officer of Harsch Investment Properties Management, LLC., a Delaware limited liability company, the Manager of SN Investments Properties, LLC,a Delaware limited liability company on its behalf. Notary Public My commission expires: /1 /�`j Commission No.: 71 G 101 OFFICIAL STAMP KRISTEN KAYE COVERT NOTARY PUBUC-OREGON �� COMMISSION NO.936104 MY COMMISSION EXPIRES FEBRUARY 12,2019 40 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 EXHIBIT A TO TRUST DEED PROPERTY SCHEDULE LEGAL DESCRIPTION: That certain real property situated in Washington County, Oregon and more particularly described as follows: PARCEL I: PARCELS 1 AND 2, PARTITION PLAT NO. 1994-028, IN THE CITY OF TIGARD, COUNTY OF WASHINGTON AND STATE OF OREGON; EXCEPTING THEREFROM THAT PORTION OF PARCEL 2 CONVEYED TO ALBERTSONS, INC., BY DEED RECORDED JULY 9, 1999 AS RECORDER'S FEE NO. 99- 082159 AND DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHWEST CORNER OF SAID PARCEL 2, PARTITION PLAT NO. 1994-028; THENCE ALONG THE WESTERLY LINE OF SAID PARCEL 2 NORTH 00°02'39" WEST, 144.43 FEET; THENCE SOUTH 89°57'21" WEST, 7.00 FEET; THENCE NORTH 00°02'39" WEST, 345.83 FEET; THENCE NORTH 89°57'21" EAST, 44.30 FEET; THENCE LEAVING SAID WESTERLY LINE SOUTH 00°02'39" EAST, 345.85 FEET; THENCE NORTH 89°57'21" EAST, 7.00 FEET; THENCE SOUTH 00°02'39" EAST, 144.46 FEET TO THE SOUTHERLY LINE OF SAID PARCEL 2; THENCE ALONG SAID SOUTHERLY LINE NORTH 89°58'42" WEST, 44.30 FEET TO THE POINT OF BEGINNING. PARCEL 2: PARCELS 1 AND 2, PARTITION PLAT NO. 2004-015, IN THE CITY OF TIGARD, COUNTY OF WASHINGTON AND STATE OF OREGON. 42 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 EXCEPTING THAT PORTION CONVEYED TO STATE OF OREGON, BY AND THROUGH ITS DEPARTMENT OF TRANSPORTATION, RECORDED FEBRUARY 14, 2014, FEE NO. 2014-008829. PARCEL 3: A PORTION OF LOTS 18 AND 19, WILLOWBROOK FARMS IN THE CITY OF TIGARD, COUNTY OF WASHINGTON AND STATE OF OREGON DESCRIBED AS: BEGINNING AT THE SOUTHWEST CORNER OF PARCEL III AS DESCRIBED IN A REAL ESTATE CONTRACT TO WILLIAM BROWNSON H AND JUDITH M.BROWNSON, RECORDED SEPTEMBER 16, 1980, AS RECORDER'S FEE NO. 80-032465, WHICH POINT BEARS SOUTH 00°08'50" EAST 695.17 FEET FROM THE ONE-QUARTER CORNER ON THE NORTH LINE OF SECTION 15,TOWNSHIP 2 SOUTH,RANGE l WEST OF THE WILLAMETTE MERIDIAN, IN THE COUNTY OF WASHINGTON AND STATE OF OREGON; THENCE NORTH 00°08'50" WEST ALONG THE EAST LINE OF THE NORTHWEST ONE-QUARTER OF SAID SECTION 15, A DISTANCE OF 50.00 FEET; THENCE SOUTH 89°58'42" EAST PARALLEL WITH THE SOUTH LINE OF SAID BROWNSEN TRACT, 629.86 FEET TO A POINT ON THE WEST LINE OF S.W. 113TH AVENUE; THENCE SOUTH 00°09'02"EAST ALONG THE WEST LINE OF SAID STREET, 50.00 FEET TO A POINT ON THE SOUTH LINE OF SAID BROWNSON TRACT; THENCE NORTH 89°58'42" WEST ALONG SAID SOUTH LINE, A DISTANCE OF 629.86 FEET TO THE POINT OF BEGINNING. PARCEL 4: AN EASEMENT FOR PARKING, INGRESS AND EGRESS, OVER THE LAND DESCRIBED THEREIN PURSUANT TO THE TERMS AND PROVISIONS THEREOF AS GRANTED IN THAT CERTAIN DECLARATION OF RESTRICTIONS AND GRANT OF EASEMENTS RECORDED JUNE 12, 1987 AS RECORDER'S FEE NO. 87-030100, AS AMENDED BY INSTRUMENT RECORDED JULY 9, 1999 AS FEE NO. 99-082160, RECORDS OF WASHINGTON COUNTY,OREGON. 43 Trust Deed Tigard Towne Square,Tigard,Oregon Loan No.901001044 79842026.4 0053805-00296 !W.DURHAM ROAD (CO. RD NO.429) . .,..... ,.. • . : -1 :::7-...!. ..,',''' -.„ ----• ,.."•,-.,-"; -;;;-•:.-' e., _-• , \\\A 7 , — 1(5/-77-7--.. '. —,e--- -----"N , co'f ....s - . ,__. ,.. z C7 ,.... ,...,....„. --...-- --- UPPc7 ..-... .i,...- - .,-. ....,,, --..„-_.- ::. . ,...i-6—---,Ir. 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A -A . .-I, • , ...• , •• .. ,• • --'1.4.--•••• t ' ."•••*----..-----....' ue. '---_ 1/4-. . 1 11 'r Site plan shows 920 parking spaces on site i CITY OF TIGARD - Approved by Planning .f-, • • ‘''.*4; 8 Date: 61/ii- \\ - ;. '• ' 11 ., --; , ' ,tn -1 3 Id g Tuncostio41444 i Initials: ..-5.;:heiliat ________________ -f---fic-u----u'rrri7 )' • „--- ; v- -7.---7.7,•,:i-, . -,14. 777 j. TIGARD TOWNE SQUARE Four Way Signal SW DURHAM ROAD 1 1 72. e II II Bank of Chase NAP4., PIpr -- .. nnn ° McDonMd's 1 - / rr �/ I. /II 4. I. ilI ... I. Aid L. i. I. II IliaGN"\"\\� I I I I I I I I I I I I II I I H H l= A r N NAP I e ��" a�V � 2�� Anytlme gH U. f g Z Fitness ft141 bVACANTDa g > S >6\\\\\\� - oe ml FORMER GROCER 00 Rite Aid �� \\\\\\\\\\\\\\\� _ s, I 1= VACANT ii.� Q\\\\\\\\\\\\\\\/ ceu c �i\\\\\\\\\\\\\� CO _ Refer to this site plan for tenant information only. �V �(� Marshalls — /grrrrr, Parking spaces not accurately depicted. \\\\\\\\\\V "' CITY OF TIGARD &\\\\ \\,,c Dollar Tree 6\\\\\\\\\\\\\\\`U� Tuesday Morning Approved by Planning Date: Sjl h-3- Initials: i—S C H Tenant Square Footage Use Category Notes Vacant 51,004 Sales-Oriented Retail Different Property Owner Marshall's#710 31,896 Sales-Oriented Retail RiteAid#5355 27,465 Sales-Oriented Retail Dollar Tree 15,041 Sales-Oriented Retail Tuesday Morning PORT-661 8,000 Sales-Oriented Retail Anytime Fitness 6,710 Indoor Entertainment Party Mart 5,048 Sales-Oriented Retail McDonald's 4,910 Fast Food Eating& Drinking Establishment Different Property Owner JP Morgan Chase#20618 3,390 Personal Services Bank with Drive In Vacant D2 3,322 Sales-Oriented Retail Gentle Dental 3,282 Medical/Dental Office Vacant B2 2,980 Sales-Oriented Retail Biscuits (MYC, Inc.) 2,624 Eating& Drinking Establishment HomeStreet Bank 2,166 Personal Services Bank with Drive In Bank of the West#651 2,100 Personal Services Bank with Drive In House of Bread 2,098 Fast Food Eating& Drinking Establishment Panda Express#1792 2,090 Fast Food Eating& Drinking Establishment Vacant E6 2,061 Sales-Oriented Retail Taekwondo 1,774 Indoor Entertainment Dotty's#19 1,400 Fast Food Eating& Drinking Establishment Subway#11803 1,400 Fast Food Eating& Drinking Establishment Cook's Cleaners 1,400 Repair-Oriented Retail Starbucks#418 1,378 Fast Food Eating& Drinking Establishment Bliss Nail and Spa 1,375 Personal Services Postal Connection 1,260 Sales-Oriented Retail Dirty Dog Day Spa 1,200 Repair-Oriented Retail Foot Solutions 1,200 Sales-Oriented Retail GNC#5565 1,200 Sales-Oriented Retail Oregon Pizza, Inc. 1,196 Fast Food Eating & Drinking Establishment T-Mobile#ORT1004143 1,125 Sales-Oriented Retail Great Clips 1,050 Personal Services SJTV, LLC(BaskinRobbins) #1390 960 Fast Food Eating& Drinking Establishment TOTAL 194,105