Commonwealth Land Title Insurance Company, NCS

ALTA ENDORSEMENTS - 148 - SAMPLES AND DESCRIPTIONS FIRST LOSS – MULTIPLE PARCEL TRANSACTIONS – FORM 20-06 ALTA Endorsement — Form 20-06 is available for loan policies only. This endorsement is designed to alter the established definition and measurement of actual loss under a loan policy, which is the difference between the value of the property as insured and the value subject to the matter insured against. Typically, an Insured lender would be required to foreclose before making a claim. Under normal circumstances, there would be no way to determine if the lender actually suffered a loss until the Land was sold after foreclosure for less than the debt. This endorsement, to be issued only when there is more than one parcel, allows for recognition of a “loss” if an impairment of security against one parcel is shown, without requiring acceleration of the debt and foreclosure against all of the parcels. This endorsement allows assertion of loss on the basis of impairment of security as if each parcel were security for a separate loan, even though the Insured transaction is structured as a single loan. The Company and the courts have applied policy Condition 8 to the determination of what is a loss in such a way that “loss”, as described in the endorsement, would be considered an interim situation, contingent upon the remaining property failing to provide adequate security for the unpaid debt. That is why this endorsement provides for subrogation and recoupment of losses paid hereunder. ALTA Endorsement — Form 20-06 (First Loss – Multiple Parcel Transactions – 6/17/06) Form 20-06 First Loss – Multiple Parcel Transactions