STG Non-Imputation Endorsement Guideline 1

Explanation:

This endorsement may be issued in conjunction with either an Owner's Policy or a Loan Policy. It limits Exclusion 3(b) concerning matters "known" by the Insured, not appearing in the public records, not known by the title company and not disclosed to the title company. For example, the endorsement may be requested when a partner is buying the interest of another partner and does not want the exclusion to be applicable as to matters known by the former partner or partners but not known by the new partner. It may also be requested by a new investor as to matters known by the former owner where property is conveyed by the former owner to a new partnership composed of the former owner and a new investor.

Underwriting Requirements:

(1) We require an indemnification by the party whose knowledge is in question and an affidavit or certification by that party that it knows of no outstanding claims or interests.
(2) We require financial disclosures by the proposed indemnitor evidencing the financial strength of that party.
(3) We require an explanation of the transaction and of the reason for the endorsement; for example, the nature of the transaction may evidence that a leveraged buyout is occurring and, thus, that an additional exception should appear.
(4) A Senior Underwriter must approve issuance of the endorsement.
(5) We require that the party whose knowledge is in question be specified by name and not generically (such as "shareholders", "officers", "other parties by operation of law" or similar general terms).