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HomeMy WebLinkAboutTitle ReportGF No. 150929 THE STATE OF TEXAS § COUNTY OF BRAZOS § CERTIFICATE BRAZOS COUNTY ABSTRACT COMPANY does hereby certify that we have examined the records in the office of the Clerk of the County Court of Brazos County, Texas, affecting the title to the said property described below from May 17, 2010: All that certain tract or parcel of land lying and being situated in the CRAWFORD BURNETT LEAGUE, Abstract No. 7, College Station, Brazos County, Texas. Said tract being a portion of a called 27.017 acre tract as described by a Deed to College Station ISD recorded in Volume 9626, page 76, Official Records of Brazos County, Texas. Said tract being more particularly described by metes and bounds as follows: BEGINNING at a 1/2 inch iron rod found on the northeast line of Holleman Drive (formerly Jones Butler Road) marking the most westerly corner of said 27.017 acre tract and the south corner of a called 108.88 acre tract as described by a Deed to Heath Phillips Investments, LLC recorded in Volume 9627, page 73, Official Records of Brazos County, Texas; THENCE along the common line of said 27.017 acre tract and said 108.88 acre tract for the following calls: N 67° 52' 33" E for a distance of 30.24 feet to a 1/2 inch iron rod found marking the beginning of a counterclockwise curve having a radius of 468.50 feet; Along said curve through a central angle of 25° 02' 43" for an arc distance of 204.79 feet (chord bears: N 55° 26' 04" E - 203.17 feet) to a 1/2 inch iron rod found marking the end of said curve; N 42° 56' 01" E for a distance of 803.33 feet to a 1/2 inch iron rod found marking the north corner of said 27.107 acre tract; S 47° 43' 18" E for a distance of 109.98 feet to the most easterly corner of this herein described tract; THENCE through said 27.017 acre tract for the following calls: S 42° 16' 42" W for a distance of 67.00 feet; N 47° 43' 18" W for a distance of 1.03 feet to the beginning of a counterclockwise curve having a radius of 25.00 feet; Along said curve through a central angle of 89° 20' 41" for an arc distance of 38.98 feet (chord bears: S 87° 36' 22" W - 35.15 feet) to the end of said curve; S 42° 56' 01" W for a distance of 712.55 feet to the beginning of a clockwise curve having a radius of 553.50 feet; Along said curve through a central angle of 25° 02' 43" for an arc distance of 241.95 feet (chord bears: S 55° 26' 04" W - 240.03 feet) to the end of said curve; S 67° 52' 32" W for a distance of 30.23 feet to the northeast line of Holleman Drive marking the south corner of this herein described tract; THENCE N 22° 02' 42" W along the northeast line of Holleman Drive for a distance of 85.00 feet tot he POINT OF BEGINNING, containing 2.105 acres of land, more or less. We find the following actions or conveyances affecting the title to said land (specifically excluding any conveyances respecting mineral estate) through July 11, 2011 @ 8 :00 A.M.: Special Warranty Deed from Arrenia H. Ellis, Individually and as Independent Executor of the Estate of Stella G. Haupt, deceased, Florence H. King, Lewis M. Haupt, III and Luella H. Trotter to College Station Independent School District, dated May 14, 2010, recorded in Volume 9626, page 76, Official Records of Brazos County, Texas. We do not certify as to property taxes. This certificate is for informational purposes only and the information contained herein shall not be relied on in the issuance of any title insurance policy. The liability of Brazos County Abstract Company in this connection is limited to $0.00, being the charge made for this certificate. WITNESS OUR HAND at Bryan, Texas, July 12, 2011 at 8:00 a.m. BRAZOS COUNTY ABSTRACT COMPANY / BY /) (;!�L� _ '} LISA KEMP 2 GF No. 148982 THE STATE OF TEXAS § COUNTY OF BRAZOS § CERTIFICATE P1,111 BRAZOS COUNTY ABSTRACT COMPANY does hereby certify that we have examined the records in the office of the Clerk of the County Court of Brazos County, Texas, affecting the title to the said property described below from May 17, 2010: Being all that certain tract or parcel of land lying and being situated in the CRAWFORD BURNETT LEAGUE, Abstract No. 7, College Station, Brazos County, Texas. Said tract being a portion of a called 108.88 acre tract as described by a Deed to Heath Philips Investments, LLC, recorded in Volume 9627, page 73, Official Records of Brazos County, Texas. Said tract being more particularly described by metes and bounds as follows: THENCE through said 108.88 acre tract for the following calls: S 47° 45' 43" E for a distance of 44117 feet; S 42° 14' 17" W for a distance of 90.00 feet; S 47° 45' 43" E for a distance of 85.00 feet; S 42° 14' 17" W for a distance of 565.10 feet to the beginning of a counterclockwise curve having a radius of 25.00 feet; BEGINNING at a 1 /2 inch iron rod found on the northeast line of Holleman Drive (formerly Jones Butler Road) marking the most westerly corner of said 108.88 acre tract and the south corner of a called 29.175 acre tract as described by a Deed to John Wheeler Barger, Trustee, recorded in Volume 7583, page 90, Official Records of Brazos County, Texas. THENCE N 42° 14' 17" E along the common line of said 108.88 acre tract and said 29.175 acre tract for a distance of 1529.19 feet to the north corner of this herein described tract; Along said curve through a central angle of 89° 57' 35" for an arc distance of 39.25 feet (chord bears: S 02° 44' 30" E — 35.34 feet) to the end of said curve on the common line of said 108.88 acre tract and a called 27.017 acre tract as described by a Deed to College Station I.S.D. recorded in Volume s 77:a c1 LI.(S 21C 9626, page 76, Official Records of Brazos County, Texas, for reference a % inch iron rod found marking a common corner of said 108.88 acre tract and said 27.017 acre tract bears: S 47° 43' 18" E for a distance of 788.66 feet; THENCE along the common line of said 108.88 acre tract and said 27.017 acre tract for the following calls: N 47° 43' 18" W for a distance of 109.98 feet to a 1 /2 inch iron rod found; S 42° 56' 01" W for a distance of 803.33 feet to a 1 /2 inch iron rod found marking the beginning of a counterclockwise curve having a radius of 468.50 feet; Along said curve through a central angle of 25° 02' 43" for an arc distance of 204.79 feet (chord bears: S 55° 26' 04" W — 203.17 feet) to a' /z inch iron rod found marking the end of said curve; S 67° 52' 33" W for a distance of 30.24 feet to a 1 /2 inch iron rod found on the northeast line of Holleman Drive marking the south corner of this herein described tract; THENCE N 22° 02' 42" W along the northeast line of Holleman Drive for a distance of 412.84 feet to the POINT OF BEGINNING, containing 17.447 acres of land, more or Tess. We find the following actions or conveyances affecting the title to said land (specifically excluding any conveyances respecting mineral estate) through effective date of July 11, 2011 @ 8:00 a.m.: Warranty Deed with Vendor's Lien from Arrenia H. Ellis, Florence H. King, Lewis M. Haupt, III and Luella H. Trotter to Heath Phillips Investments, LLC, dated May 13, 2010, recorded in Volume 9627, page 73, Official Records of Brazos County, Texas. (108.88 acres) Deed of Trust, Security Agreement, Fixtures Financing Statement and Assignment of Rents and Leases dated May 13, 2010, executed by Heath Phillips Investments, LLC to Julius C. Dunlap, Trustee, for the benefit of American Momentum Bank, in the principal amount of $2,994,200.00, recorded in Volume 9627, page 80, Official Records of Brazos County, Texas. (108.88 acres) Modification, Rearrangement and/or Extension Agreement by and between Heath Phillips Investments, LLC and American Momentum Bank, dated June 21, 2011, but effective May 13, 2011, recorded in Volume 10220, page 151, Official Records of Brazos County, Texas. We do not certify as to property taxes. This certificate is for informational purposes only and the information contained herein shall not be relied on in the issuance of any title insurance policy. The liability of Brazos County Abstract Company in this connection is limited to $00.00, being the charge made for this certificate. WITNESS OUR HAND at Bryan, Texas, this the 12th day of July, 2011. BRAZOS COUNTY ABSTRACT COMPANY BY:/ t -? E� %y1LI'� LI SA KEMP Commonwealth i. *D Mt* CtlSNNANCE COMPMVY Policy No.: TX0265 -81- 148982- 2010.8139843- 80691871 8139843 (2/10) OWNER'S POLICY OF TITLE INSURANCE (T -1) Issued by COMMONWEALTH LAND TITLE INSURANCE COMPANY Any notice of claim and any other notice or statement in writing required to be given the Company under this Policy must be given to the Company at the address shown in Section 18 of the Conditions. COVERED RISKS SUBJECT TO THE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE CONTAINED IN SCHEDULE B AND THE CONDITIONS, COMMONWEALTH LAND TITLE INSURANCE COMPANY, a Nebraska corporation (the "Company ") insures, as of Date of Policy and, to the extent stated in Covered Risks 9 and 10, after .Date of Policy, against loss or damage, not exceeding the Amount of Insurance, sustained or incurred by the Insured by reason of: 1. Title being vested other than as stated in Schedule A. 2. Any defect in or lien or encumbrance on the Title. This Covered Risk includes but is not limited to insurance against loss from: (a) A defect in the Title caused by: (i) forgery, fraud, undue influence, duress, incompetency, incapacity or impersonation; (ii) failure of any person or Entity to have authorized a transfer or conveyance; (iii) a document affecting Title not properly created, executed, witnessed, sealed, acknowledged, notarized or delivered; (iv) failure to perform those acts necessary to create a document by electronic means authorized by law; (v) a document executed under a falsified, expired or otherwise invalid power of attorney; (vi) a document not properly filed, recorded or indexed in the Public Records including failure to perform those acts by electronic means authorized by law; or (vii)a defective judicial or administrative proceeding. (b) The lien of real estate taxes or assessments imposed on the Title by a governmental authority due or payable. but unpaid. (c) Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land. The term "encroachment" includes encroachments of existing improvements located on the Land onto adjoining land, and encroachments onto the Land of existing improvements located on adjoining land. (d) Any statutory or constitutional mechanic's, contractor's, or materialman's lien for labor or materials having its inception on or before Date of Policy. 3. Lack of good and indefeasible Title. 4. No right of access to and from the Land. 5. The violation or enforcement of any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting or relating to: (a) the occupancy, use or enjoyment of the Land; (b) the character, dimensions or location of any improvement erected on the Land; (c) subdivision of land; or (d) environmental protection if a notice, describing any part of the Land, is recorded in the Public Records setting forth the violation or intention to enforce, but only to the extent of the violation or enforcement referred to in that notice. 6. An enforcement action based on the exercise of a governmental police power not covered by Covered Risk 5 if a notice of the enforcement action, describing any part of the Land, is recorded in the Public Records, but only to the extent of the enforcement referred to in that notice. 7. The exercise of the rights of eminent domain if a notice of the exercise, describing any part of the Land, is recorded in the Public Records. 8. Any taking by a governmental body that has occurred and is binding on the rights of a purchaser for value without Knowledge. 9. Title being vested other than as stated in Schedule A or being defective: Owner's Policy of Title Insurance T -1 (2/01/10) (a) as a result of the avoidance in whole or in part, or from a court order providing an alternative remedy, of a transfer of all or any part of the title to or any interest in the Land occurring prior to the transaction vesting Title as shown in Schedule A because that prior transfer constituted a fraudulent or preferential transfer under federal bankruptcy, state insolvency or similar creditors' rights laws: or (b) because the instrument of transfer vesting Title as shown in Schedule A constitutes a preferential transfer under federal bankruptcy, state insolvency or similar creditors' rights laws by reason of the failure of its recording in the Public Records: (i) to be timely, or (ii) to impart notice of its existence to a purchaser for value or a judgment or lien creditor. 10. Any defect in or lien or encumbrance on the Title or other matter included in Covered Risks 1 through 9 that has been created or attached or has been filed or recorded in the Public Records subsequent to Date of Policy and prior to the recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A. The Company will also pay the costs, attorneys' fees and expenses incurred in defense of any matter insured against by this Policy, but only to the extent provided in the Conditions. Autt tyi`ied Signatory TX0265 148982 Brazos County Abstract Company 3800 Cross Park Dr Bryan , TX 77802 Tel:(979) 731 -1900 Fax:(979) 731 -8352 8139843 (2/10) COMMONWEALTH LAND TITLE INSURANCE COMPANY Owner's Policy of Title Insurance T -1 (2/01/10) Premium: $14,404.00 1200 P-L SCHEDULE A Name and Address of Title Insurance Company: Commonwealth Land Title Insurance Company 5600 Cox Road Glen Alien, Virginia 23060 -9266 File No.: 148982 Policy No.: 8139843- 80691871 Issued With: 8139943 - 80691939 Address for Reference Only: 3100 Haupt Road College Station, TX, 77845 POLICY AMOUNT: $2,994,200.00 POLICY DATE: May 17, 2010 at 03:46 PM 1. NAME OF INSURED: HEATH PHILLIPS INVESTMENTS, LLC 2. WE INSURE YOUR INTEREST IN THE LAND COVERED BY THIS POLICY IS: FEE SIMPLE 3. TITLE TO THE ESTATE OR INTEREST IN THE LAND IS VESTED IN: HEATH PHILLIPS INVESTMENTS, LLC 4. LEGAL DESCRIPTION OF THE LAND: Being all that certain tract or parcel of land lying and being situated in the CRAWFORD BURNETT LEAGUE, Abstract No. 7, College Station, Brazos County, Texas. Said tract being the remainder of a called 136.063 acre tract as described by a Deed to L. M. Haupt, Jr. and wife, Stella Geren Haupt recorded in Volume 171, page 392, Deed Records of Brazos County, Texas, and the remainder of a called 3.3 acre tract as described by a Deed to Lewis M. Haupt, Jr., recorded in Volume 293, page 788, Deed Records of Brazos County, Texas. Said tract being more particularly described by metes and bounds as follows: BEGINNING at a 1/2 inch iron rod found on the southwest line of Old Wellbom Road marking the east comer of said remainder of 136.063 acre tract and the north comer of a called 12.40 acre tract as described by a Deed to Osage, Ltd., recorded in Volume 1130, page 570, Official Records of Brazos County, Texas; BRAZOS COUNTY ABSTRACT COMPANY File No.: 148982 COMMONWEALTH LAND TITLE INSURANCE COMPANY SCHEDULE B (Continued) Policy No.: 8139843- 80691871 THENCE S 41° 12' 34" W along the common line of said remainder of 136.063 acre tract and said 12.40 acre tract for a distance of 517.37 feet to a 3/8 inch iron rod found marking the west comer of said 12.40 acre tract and the north comer of the remainder of a called 8.833 acre tract as described by a Deed to Greens Prairie Investors, Ltd., recorded in Volume 8413, page 22, Official Records of Brazos County, Texas; THENCE S 41° 55' 50" W along the common line of said remainder of 136.063 acre tract and said remainder of 8.833 acre tract for a distance of 429.64 feet to a 1/2 inch iron rod found marking the common comer of said remainder of 8.833 acre tract and the remainder of a called 3.0 acre tract as described by a Deed to Greens Prairie Investors, Ltd., recorded in Volume 8513, page 276, Official Records of Brazos County, Texas; THENCE S 41° 18' 46" W along the common line of said remainder of 136.063 acre tract and said remainder of 3.0 acre tract for a distance of 124.14 feet to a 1/2 inch iron rod found marking the north comer of Williamsgate Subdivision, Phase 1, according to the plat recorded in Volume 7705, page 206, Official Records of Brazos County, Texas; THENCE S 41° 30' 18" W along the common line of said remainder of 136.063 acre tract and Williamsgate Subdivision, Phase 1 and the remainder of a called 20.25 acre tract as described by a Deed to Robbie Robinson, Ltd., recorded in Volume 6446, page 92, Official Records of Brazos County, Texas, for a distance of 637.46 feet to a 1/2 inch iron rod found marking an easterly comer of a called 22.97 acre tract as described by a Deed to Charles I. Tumer and Mary E. Tumer recorded in Volume 3331, page 61, Official Records of Brazos County, Texas; THENCE N 49° 58' 35" W along the common line of said remainder of 136.063 acre tract and said 22.97 acre tract for a distance of 562.09 feet to a 1/2 inch iron rod found marking the north comer of said 22.97 acre tract; THENCE S 41° 21' 39" W continuing along the common line of said remainder of 136.063 acre tract and said 22.97 acre tract for a distance of 801.59 feet to a 1/2 inch iron rod found on the northwest line of a called 23.00 acre tract described as Tract 2 by a Deed to Henry P. Mayo and wife, Sandra K. Mayo, recorded in Volume 1253, page 878, Official Records of Brazos County, Texas, marking the east comer of a called 27.017 acre tract divided out of said remainder of 136.063 acre tract, said 27.017 acre tract not yet filed of record at the time of this description; THENCE through said remainder of 136.063 acre tract and along the northeast and northwest lines of said 27.017 acre tract for the following calls: N 47° 43' 18" W for a distance of 898.64 feet to a 1/2 inch iron rod found; S 42° 56' 01" W for a distance of 803.33 feet to a 1/2 inch iron rod found marking the beginning of a clockwise curve having a radius of 468.50 feet; Along said curve through a central angle of 25° 02' 43" for an arc distance of 204.79 feet (Chord Bears: S 55° 26' 04" W - 203.17 feet) to a 1/2 inch iron rod found marking the ending point of said curve; S 67° 52' 33" W for a distance of 30.24 feet to a 1/2 inch iron rod found on the northeast line of Jones Butler road marking the southwest comer of this herein described tract; File No.: 148982 COMMONWEALTH LAND TITLE INSURANCE COMPANY SCHEDULE B (Continued) Policy No.: 8139843 - 80691871 THENCE N 22° 02' 42" W along the northeast line of Jones Butler Road, same being the southwest line of said remainder of 3.3 acre tract, for a distance of 412.84 feet to a 1/2 inch iron rod found marking the common comer of said remainder of 3.3 acre tract and a called 29,175 acre tract as described by a Deed to John Wheeler Barger, Trustee, recorded in Volume 7583, page 90, Official Records of Brazos County, Texas; THENCE N 42° 14' 17" E along the common line of said remainder of 3.3 acre tract and said remainder of 136.063 acre tract and said 29.175 acre tract for a distance of 3402.74 feet to a 6 inch fence comer post found on the southwest line of Old Welibom Road marking the north comer of this herein described tract; THENCE S 47° 04' 17" E along the southwest line of Old Welibom Road for a distance of 1867.58 feet to the POINT OF BEGINNING, containing 108.88 acres of land, more or Tess. File No: 148982 COMMONWEALTH LAND TITLE INSURANCE COMPANY SCHEDULE B (Continued) Policy No.: 8139843 - 80691871 d. Service utilities and appurtenant facilities as depicted on survey plat prepared by Brad Kerr, Registered Professional Land Surveyor, State of Texas, No. 4502, dated March 11, 2010. e. Right -of -Way Easement from J. W. Mochas to Sinclair Refining Company, dated September 6, 1947, recorded in Volume 132, page 68, Deed Records of Brazos County, Texas, and noted as a blanket easement on survey plat prepared by Brad Kerr, Registered Professional Land Surveyor, State of Texas, No. 4502, dated March 11, 2010. f. Right -of -Way Easement from P. D. Gandy et ux to City of Bryan, dated December 22, 1949, recorded in Volume 141, page 392, Deed Records of Brazos County, Texas, and noted as a blanket easement on survey plat prepared by Brad Kerr, Registered Professional Land Surveyor, State of Texas, No. 4502, dated March 11, 2010. g. Right -of -Way Easement from Arrenia Haupt Ellis et al to Wellbom Special Utility District, dated May 12, 1999, recorded in Volume 3645, page 298, Official Records of Brazos County, Texas, and noted as a blanket easement on survey plat prepared by Brad Kerr, Registered Professional Land Surveyor, State of Texas, No. 4502, dated March 11, 2010. h. Public Utility Easement from Arrenia H. Ellis et at to City of College Station, Texas, dated May 24, 2006, recorded in Volume 7233, page 93, Official Records of Brazos County, Texas, and as shown on survey plat prepared by Brad Kerr, Registered Professional Land Surveyor, State of Texas, No. 4502, dated March 11, 2010. i. Temporary Construction Easement from Arrenia H. Ellis et al to City of College Station, Texas, dated May 24, 2006, recorded in Volume 7233, page 103, Official Records of Brazos County, Texas. j. Royalty reservation in Deed from S. F. Machos et al to P. D. Gandy, dated October 3, 1949, recorded in Volume 140, page 614, Deed Records of Brazos County, Texas. Title to this reservation has not been traced subsequent to the date of the above -cited instrument. k. Mineral and groundwater reservation in Deed from Arrenia H. Ellis, et al to Heath Philips Investments, LLC, dated May 13, 2010, recorded in Volume 9637, page 73, Official Records of Brazos County, Texas. Title to this reservation has not been traced subsequent to the date of the above -cited instrument. I. Estate created by Oil and Gas Leases from Florence Haupt King et al to Baker Exploration Company, dated December, 1993, recorded in Volume 2020, pages 93, 113, 122 and 140, Official Records of Brazos County, Texas. Title to this lease has not been traced subsequent to the date of the above -cited instrument. m. Estate created by Oil and Gas Lease from Lewis M. Haupt to Baker Exploration Company, dated January 5, 1994, recorded in Volume 2020, page 146, Official Records of Brazos County, Texas. Title to this lease has not been traced subsequent to the date of the above -cited instrument. n. Terms, conditions and stipulations contained in Bill of Sale for Water rights from Haupt Family Partnership to the Haupt Water Partnership, dated December 7, 2000, recorded in Volume 4012, page 288, Official Records of Brazos County, Texas. o. All leases, grants, exceptions or reservations of coal, lignite, oil, gas and other minerals, together with all rights, privileges and immunities relating thereto, appearing in the Public Records, whether listed in Schedule B or not. There may be leases, grants, exceptions or reservations of mineral EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage, costs, attorneys' fees or expenses that arise by reason of 1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting or relating to: (i) the occupancy, use, or enjoyment of the Land; (ii) the character. dimensions or location of any improvement erected on the Land; (iii) subdivision of land: or (iv) environmental protection: or the effect of any violation of these laws, ordinances or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5. (b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6. 2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8. 3. Defects, liens, encumbrances, adverse claims or other matters: (a) created, suffered, assumed or agreed to by the insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 9 and 10); or (e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Title. 4. Any claim by reason of the operation of federal bankruptcy, state insolvency or similar creditors' rights laws that the transaction vesting the Title as shown in Schedule A is: (a) a fraudulent conveyance or fraudulent transfer; or (b) a preferential transfer for any reason not stated in Covered Risk 9 of this policy. 5. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A. 6. The refusal of any person to purchase, lease or lend money on the estate or interest covered hereby in the land described in Schedule A because of Unmarketable Title. I. DEFINITION OF TERMS. The following terms when used in this policy mean: (a) "Amount of Insurance ": the amount stated in Schedule A, as may be increased or decreased by endorsement to this policy, increased by Section 8(b), or de- creased by Sections 10 and 11 of these Conditions. (b) "Date of Policy ": The date designated as "Date of Policy" in Schedule A. (c) "Entity": A corporation, partnership, trust, limited liability company or other similar legal entity. (d) "Insured ": the Insured named in Schedule A. (1) The term "insured" also includes: (A) successors to the Title of the Insured by operation of law as distinguished from purchase, including heirs, devisees, survivors. personal representatives or next of kin; (B) successors to an Insured by dissolution, merger, consolidation, distribution or reorganization; (C) successors to an Insured by its conversion to another kind of Entity: (D) a grantee of an Insured under a deed delivered without payment of actual valuable consideration conveying the Title: (1) If the stock, shares, memberships, or other equity interests of the grantee are wholly -owned by the named Insured, (2) If the grantee wholly owns the named Insured, (3) If the grantee is wholly -owned by an affiliated Entity of the named Insured, provided the affiliated Entity and the named Insured are both wholly -owned by the same person or Entity, or (4) If the grantee is a trustee or beneficiary of a trust created by a written instrument established by the insured named in Schedule A for estate planning purposes. (ii) With regard to (A), (B), (C) and (D) reserving, however, all rights and defenses as to any successor that the Company would have had against any predecessor lnsured. (e) "Insured Claimant ": an Insured claiming loss or damage. (f) "Knowledge" or "Known ": actual knowledge. not constructive knowledge or notice that may be imputed to an Insured by reason of the Public Records or any other records that impart constructive notice of matters affecting the Title. (g) "Land ": the land described in Schedule A, and affixed improvements that by law constitute real property. The term "Land" does not include any property beyond the lines of the area described in Schedule A, nor any right, title, interest, estate or easement in abutting streets, roads, avenues, alleys, lanes. ways or waterways, but this does not modify or limit the extent that a right of access to and from the Land is insured by this policy. (h) "Mortgage ": mortgage, deed of trust, trust deed, or other security instrument, including one evidenced by electronic means authorized by law. "Public Records ": records established under state statutes at Date of Policy tier the purpose of imparting constructive notice of matter relating to real property to purchasers for value and without Knowledge. With respect to Covered Risk 5(d). "Public Records" shall also include environmental protection liens filed in the records of the 8139843 (2/10) (1) CONDITIONS 2. 3. clerk of the United States District Court for the district where the Land is located. (j) "Title ": the estate or interest described in Schedule A. (k) "Unmarketable Title ": Title affected by an alleged or apparent matter that would permit a prospective purchaser or lessee of the Title or lender on the Title to be released from the obligation to purchase, lease or lend 11' there is a contractual condition requiring the delivery of marketable title. CONTINUATION OF INSURANCE. The coverage of this policy shall continue in force as of Date of Policy in favor of an Insured, but only so long as the Insured retains an estate or interest in the Land, or holds an obligation secured by a purchase money Mortgage given by a purchaser from the insured, or only so long as the Insured shall have liability by reason of warranties in any transfer or conveyance of the Title. This policy shall not continue in force in favor of any purchaser from the Insured of either (1) an estate or interest in the Land, or (ii) an obligation secured by a purchase money Mortgage given to the Insured. NOTICE OF CLAIM TO BE GIVEN BY INSURED CLAIMANT. The insured shall notify the Company promptly in writing (1) in case of any litigation as set forth in Section 5(a) below, or (ii) in case Knowledge shall come to an Insured hereunder of any claim of title or interest that is adverse to the Title, as insured, and that might cause loss or damage for which the Company may be liable by virtue of this policy. If the Company is prejudiced by the failure of the Insured Claimant to provide prompt notice. the Company's liability to the Insured Claimant under the policy shall be reduced to the extent of the prejudice. When, after the Date of the Policy, the Insured notifies the Company as required herein of a lien, encumbrance, adverse claim or other defect in Title insured by this policy that is not excluded or excepted from the coverage of this policy, the Company shall promptly investigate the charge to determine whether the lien, encumbrance, adverse claim or defect or other matter is valid and not barred by law or statute. The Company shall notify the insured in writing, within a reasonable time, of its determination as to the validity or invalidity of the Insured's claim or charge under the policy. If the Company concludes that the lien, encumbrance, adverse claim or defect is not covered by this policy, or was otherwise addressed in the closing of'the transaction in connection with which this policy was issued, the Company shall specifically advise the insured of the reasons for its determination. if the Company concludes that the lien, encumbrance, adverse claim or defect is valid, the Company shall take one of the following actions: (1) institute the necessary proceedings to clear the lien, encumbrance, adverse claim or defect from the Title as insured; (ii) indemnify the insured as provided in this policy: (111) upon payment of appropriate premium and charges therefor, issue to the insured Claimant or to a subsequent owner, mortgagee or holder of the estate or interest in the Land insured by this policy, a policy of title insurance without exception for the lien, encumbrance, adverse claim or defect, said policy to be in an amount equal to the current value of the Land or. if a loan policy, the amount of the loan: (iv) indemnify another title insurance company in connection with its issuance of a policy(ies) of title insurance without exception for the lien, encumbrance, adverse claim or defect; (v) secure a release or other document discharging the lien, encumbrance, adverse claim or defect; or (vi) undertake a combination of (i) through (v) herein. Owner's Policy of Title Insurance T -1 (2/01/10) 9 PROOF OF LOSS. In the event the Company is unable to determine the amount of loss or damage, the Company may, at its option, require as a condition of payment that the Insured Claimant furnish a signed proof of loss. The proof of loss must describe the defect, lien. encumbrance or other matter insured against by this policy that constitutes the basis of loss or damage and shall state, to the extent possible, the basis of calculating the amount of the loss or damage. 5. DEFENSE AND PROSECUTION OFACTIONS. (a) Upon written request by the Insured, and subject to the options contained in Sections 3 and 7 of these Conditions, the Company, at its own cost and without unreasonable delay, shall provide for the defense of an Insured in litigation in which any third party asserts a claim covered by this policy adverse to the Insured. This obligation is limited to only those stated causes of action alleging matters insured against by this policy. The Company shall have the right to select counsel of its choice (subject to the right of the Insured to object for reasonable cause) to represent the Insured as to those stated causes of action. It shall not be liable for and will not pay the fees of any other counsel. The Company will not pay any fees, costs or expenses incurred by the Insured in the defense of those causes of action that allege matters not insured against by this policy. (b) The Company shall have the right, in addition to the options contained in Sections 3 and 7, at its own cost, to institute and prosecute any action or proceeding or to do any other act that in its opinion may be necessary or desirable to establish the Title, as insured, or to prevent or reduce loss or damage to the Insured. The Company may take any appropriate action under the terms of this policy, whether or not it shall be liable to the insured- The exercise of these rights shall not be an admission of liability or waiver of any provision of this policy. If the 8. Company exercises its rights under this subsection, it must do so diligently. (c) Whenever the Company brings an action or asserts a defense as required or permitted by this policy, the Company may pursue the litigation to a final determination by a court of competent jurisdiction and it expressly reserves the right, in its sole discretion, to appeal from any adverse judgment or order. 6. DUTY OF INSURED CLAIMANT TO COOPERATE. (a) In all cases where this policy permits or requires the Company to prosecute or provide for the defense of any action or proceeding and any appeals, the Insured shall secure to the Company the right to so prosecute or provide defense in the action or proceeding, including the right to use, at its option, the name of the Insured for this purpose. Whenever requested by the Company, the Insured, at the Company's expense, shall give the Company all reasonable aid (i) in securing evidence, obtaining witnesses, prosecuting or defending the action or proceeding, or effecting settlement, and (ii) in any other lawful act that in the opinion of the Company may be necessary or desirable to establish the Title or any other 9. matter as insured. If the Company is prejudiced by the failure of the Insured to furnish the required cooperation, the Company's obligations to the Insured under the policy shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation, with regard to the matter or matters requiring such cooperation. (b) The Company may reasonably require the Insured Claimant to submit to examination under oath by any authorized representative of the Company and to produce for examination, inspection and copying, at such reasonable times and places as may be designated by the authorized representative of the Company, all records, in whatever medium maintained, including books, ledgers, checks, memoranda, correspondence, reports, emails. disks, tapes, and videos whether bearing a date before or after Date of Policy, that reasonably pertain to the loss or damage. Further, if requested by any authorized representative of the Company, the Insured Claimant shall grant its permission, in writing, for any authorized representative of the Company to examine, 10 inspect and copy all of these records in the custody or control of a third party that reasonably pertain to the loss or damage. All information designated as confidential by the Insured Claimant provided to the Company pursuant to this Section shall not be disclosed to others unless, in the reasonable judgment of the Company, it is necessary in the 11. administration of the claim. Failure of the Insured Claimant to submit for examination under oath, produce any reasonably requested information or grant permission to secure reasonably necessary information from third parties as required in this subsection, unless prohibited by law or governmental regulation, shall terminate any liability of the Company under this policy as to that claim. 7. OPTIONS TO PAY OR OTHERWISE SETTLE CLAIMS; 12. TERMINATION OF LIABILITY". 8139843 (2/10) In case of a claim under this policy, the Company shall have the following additional options: (a) To Pay or Tender Payment of the Amount of insurance. . To pay or tender payment of the Amount of Insurance under this policy together with any costs, attorneys' fees and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment or tender of payment and that the Company is obligated to pay. Upon the exercise by the Company of this option, all liability and obligations of the Company to the Insured under this policy, other than to make the payment required in this subsection, shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation. (b) To Pay or Otherwise Settle With Parties Other than the Insured or With the Insured Claimant. (1) to pay or otherwise settle with other parties for or in the name of an Insured Claimant any claim insured against under this policy. in addition, the Company will pay any costs, attorneys' fees and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment and that the Company is obligated to pay; or i) to pay or otherwise settle with the Insured Claimant the loss or damage provided for under this policy, together with any costs, attorneys' fees and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment and that the Company is obligated to pay. Upon the exercise by the Company of either of the options provided for in subsections (bXi) or (ii), the Company's obligations to the Insured under this policy for the claimed loss or damage, other than the payments required to be made, shall terminate, including any liability or obligation to defend, prosecute or continue any litigation. DETERMINATION AND EXTENT OF LIABILITY This policy is a contract of indemnity against actual monetary loss or damage sustained or incurred by the Insured Claimant who has suffered loss or damage by reason of matters insured against by this policy. (a) The extent of liability of the Company for loss or damage under this policy shall not exceed the lesser of: (i) the Amount of Insurance; or (ii) the difference between the value of the Title as insured and the value of the Title subject to the risk insured against by this policy. (b) If the Company pursues its rights under Section 3 or 5 and is unsuccessful in establishing the Title, as insured: (1) the Amount of Insurance shall be increased by 10 %; and (ii) the Insured Claimant shall have the right to have the loss or damage determined either as of the date the claim was trade by the Insured Claimant or as of the date it is settled and paid. (c) In addition to the extent of liability under (a) and (b), the Company will also pay those costs, attorneys' fees and expenses incurred in accordance with Sections 5 and 7 of these Conditions. LIMITATION OF LIABILITY. (a) If the Company establishes the Title, or removes the alleged detect, lien or encumbrance, or cures the lack of a right of access to or from the Land, all as insured, or takes action in accordance with Section 3 or 7, in a reasonably diligent manner by any method, including litigation and the completion of any appeals, it shall have fully performed its obligations with respect to that matter and shall not be liable for any loss or damage caused to the Insured. (b) In the event of any litigation, including litigation by the Company or with the Company's consent, the Company shall have no liability for loss or damage until there has been a final determination by a court of competent jurisdiction, and disposition of all appeals, adverse to the Title, as insured. (c) The Company shall not be liable for loss or damage to the Insured for liability voluntarily assumed by the Insured in settling any claim or suit without the prior written consent of the Company. • REDUCTION OF INSURANCE; REDUCTION OR TERMINATION OF LIABILITY: All payments under this policy, except payments made for costs, attorneys' fees and expenses, shall reduce the Amount of Insurance by the amount of the payment. LIABILITY NONCUMULATIVE. The Amount of Insurance shall be reduced by any amount the Company pays under any policy insuring a Mortgage to which exception is taken in Schedule B or to which the Insured has agreed, assumed, or taken subject or which is executed by an Insured after Date of Policy and which is a charge or lien on the Title, and the amount so paid shall be deemed a payment to the Insured under this policy. PAYMENT OF LOSS. When liability and the extent of loss or damage have been definitely fixed in ( Owner's Policy of Title Insurance T -1 (2/01/10)