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CONDITIONS AND STIPULATIONS 1. DEFINITION OF TERMS. �c)Whenever the Company shall have brought an action or interposed a de ense as required or permitted by the provisions of this policy, the The following tetras when used in this policy mean: Company may pursue any litigation to final determination by a court of competent jurisdiction and expressly reserves the right,in its sole discretion, (a) "insured": the insured named in Schedule A, and, subject to any to appeal from any adverse judgment or order. rights or defenses the Company would have had against the named insured, those who succeed to the interest of the named insured by operation of law (d) In all cases where this policy permits or requires the Company to as distinguished from purchase including, but not limited to, heirs, prosecute or provide for the defense of any action or proceeding, the distributees, devisees, survivors, personal representatives, next of kin, or insured shall secure to the Company the right to so prosecute or provide corporate or fiduciary successors. defense in the action or proceeding,and all appeals therein,and permit the (b) "insured claimant": an insured claiming loss or damage. Company to use, at its option, the name of the insured for this purpose. c) "knowledge" or "known": actual knowledge, not constructive Whenever requested by the Company, the insured, at the Company's ( g " g expense, shall give the Company all reasonable aid (i) in any action or knowledge or notice which may be imputed to an insured by reason of the proceeding, securing evidence, obtaining witnesses, prosecuting or public records as defined in this policy or any other records which impart defending the action or proceeding, or effecting settlement, and (ii) in any constructive notice of matters affecting the land. other lawful act which in the opinion of the Company may be necessary or (d) "land": the land described or referred to in Schedule A, and desirable to establish the title to the estate or interest as insured. If the improvements affixed thereto which by law constitute real property. The Company is prejudiced by the failure of the insured to furnish the required tern "land" does not include any property beyond the lines of the area cooperation, the Company's obligations to the insured under the policy described or referred to in Schedule A, nor any right , title, interest, estate shall terminate,including any liability or obligation to defend,prosecute,or or easement in abutting streets, roads, avenues, alleys, lanes, ways or continue any litigation, with regard to the matter or matters requiring such waterways, but nothing herein shall modify or limit the extent to which a cooperation. right of access to and from the land is insured by this policy. S. PROOF OF LOSS OR DAMAGE. (e) "mortgage": mortgage, deed of trust, trust deed, or other security In addition to and after the notices required under Section 3 of these instrument. Conditions and Stipulations have been provided the Company, a proof of (f) "public records": records established under state statutes at Date of loss or damage signed and sworn to by the insured claimant shall be Policy for the purpose of imparting constructive notice of matters relating furnished to the Company within 90 days after the insured claimant shall to real property to purchasers for value and without knowledge. With ascertain the facts giving rise to the loss or damage. The proof of loss or respect to Section 1(a) (iv) of the Exclusions From Coverage, "public damage shall describe the defect in, or lien or encumbrance on the title, or records" shall also include environmental protection liens filed in the other matter insured against by this policy which constitutes the basis of records of the clerk of the United States district court for the district in loss or damage and shall state, to the extent possible, the basis of which the land is located. calculating the amount of the loss or damage. If the Company is prejudiced by the failure of the insured claimant to provide the required proof of loss (g)"unmarketability of the title": an alleged or apparent matter affecting or damage,the Company's obligations to the insured under the policy shall the title to the land, not excluded or excepted from coverage, which would terminate, including any liability or obligation to defend, prosecute, or entitle a purchaser of the estate or interest described in Schedule A to be continue any litigation, with regard to the matter or matters requiring such released from the obligation to purchase by virtue of a contractual proof of loss or damage. condition requiring the delivery of marketable title. In addition, the insured claimant may reasonably be required to submit 2. CONTINUATION OF INSURANCE AFTER CONVEYANCE to examination under oath by any authorized representative of the OF TITLE. Company and shall produce for examination, inspection and copying, at such reasonable times and places as may be designated by any authorized The coverage of this policy shall continue in force as of Date of Policy in representative of the Company, all records, books, ledgers, checks, favor of an insured only so long as the insured retains an estate or interest correspondence and memoranda, whether bearing a date before or after in the land, or holds an indebtedness secured by a purchase money Date of Policy, which reasonably pertain to the loss or damage. Further, if mortgage given by a purchaser from the insured, or only so long as the requested by any authorized representative of the Company , the insured insured shall have liability by reason of covenants of warranty made by the claimant shall grant its permission, in writing, for any authorized insured in any transfer or conveyance of the estate or interest. This policy representative of the Company to examine , inspect and copy all records, shall not continue in force in favor of any purchaser from the insured of books, ledgers, checks, correspondence and memoranda in the custody or either(i)an estate or interest in the land, or(ii)an indebtedness secured by control of a third party, which reasonably pertain to the loss or damage. a purchase money mortgage given to the insured. All information designated as confidential by the insured claimant provided to the Company pursuant to this Section shall not be disclosed to others 3. NOTICE OF CLAIM TO BE GIVEN BY INSURED CLAIMANT. unless, in the reasonable judgement of the Company, it is necessary in the The insured shall notify the Company promptly in writing i in case of administration of the claim. Failure of the insured claimant to submit for y p y p p y . g O examination under oath, produce other reasonably requested information any litigation as set forth in Section 4(a)below, (ii)in case knowledge shall or grant permission to secure reasonably necessary information from third come to an insured hereunder of any claim of title or interest which is parties as required in this paragraph shall terminate any liability of the adverse to the title to the estate or interest, as insured, and which might Company under this policy as to that claim. cause loss or damage for which the Company may be liable by virtue of this policy, or(iii) if title to the estate or interest, as insured, is rejected as 6. OPTIONS TO PAY OR OTHERWISE SETTLE CLAIMS; unmarketable. If prompt notice shall not be given to the Company, then as TERMINATION OF LIABILITY. to the insured all liability of the Company shall terminate with regard to In case of a claim under this policy,the Company shall have the following the matter or matters for which prompt notice is required; provided, however, that failure to notify the Company shall in no case prejudice the additional options: rights of any insured under this policy unless the Company shall be (a)To Pay or Tender Payment of the Amount of Insurance. prejudiced by the failure and then only to the extent of the prejudice. To pay or tender payment of the amount of insurance under this policy together with any costs, attorneys' fees and expenses incurred by 4. DEFENSE AND PROSECUTION OF ACTIONS; DUTY OF the insured claimant, which were authorized by the Company, up to the INSURED CLAIMANT TO COOPERATE. time of payment or tender of payment and which the Company is obligated to pay. (a) Upon written request by the insured and subject to the options Upon the exercise by the Company of this option, all liability and contained in Section 6 of these Conditions and Stipulations, the Company, obligations to the insured under this policy, other than to make the at its own cost and without unreasonable delay, shall provide for the payment required, shall terminate, including any liability or obligation to defense of an insured in litigation in which any third party asserts a claim defend, prosecute, or continue any litigation, and the policy shall be adverse to the title or interest as insured,but only as to those stated causes surrendered to the Company for cancellation. of action alleging a defect, lien or encumbrance or other matter insured (b)To Pay or Otherwise Settle With Parties Other than the Insured or against by this policy. The Company shall have the right to select counsel With the Insured Claimant. of its choice (subject to the right of the insured to object for reasonable (i) to pay or otherwise settle with other parties for or in the name cause) to represent the insured as to those stated causes of action and shall of an insured claimant any claim insured against under this policy, together not be liable for and will not pay the fees of any other counsel. The with any costs, attorneys' fees and expenses incurred by the insured Company will not pay any fees, costs or expenses incurred by the insured claimant which were authorized by the Company up to time of payment in the defense of those causes of action which allege matters not insured and which the Company is obligated to pay; or against by this policy. (ii) to pay or otherwise settle with the insured claimant the loss or damage provided for under this policy, together with any costs, attorneys' (b) The Company shall have the right, at its own cost, to institute and fees and expenses incurred by the insured claimant which were authorized prosecute any action or proceeding or to do any other act which in its by the Company up to the time of payment and which the Company is opinion may be necessary or desirable to establish the title to the estate or obligated to pay. interest, as insured, or to prevent or reduce loss or damage to the insured. Upon the exercise by the Company of either of the options provided for The Company may take any appropriate action under the terms of this in paragraphs(b)(i) or(ii), the Company's obligations to the insured under policy, whether or not it shall be liable hereunder, and shall not thereby this policy for the claimed loss or damage, other than the payments concede liability or waive any provision of this policy. If the Company required to be made,shall terminate,including any liability or obligation to shall exercise its rights under this paragraph,it shall do so diligently. defend, prosecute or continue any litigation. Conditions and Stipulations Continued Inside Cover B 1190-21A