10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2009

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                                  to                                 

Commission file number 001-13585

(Exact name of registrant as specified in its charter)

Incorporated in California	95-1068610
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1 First American Way, Santa Ana, California 92707-5913

(Address of principal executive offices) (Zip Code)

(714) 250-3000

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Common	New York Stock Exchange
(Title of each class)	(Name of each exchange on which registered)

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  x    No  ¨

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ¨    No  x

Indicate by check mark whether registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ¨    No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  x	Accelerated filer  ¨
Non-accelerated filer  ¨ (Do not check if a smaller reporting company)	Smaller reporting company  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  ¨    No  x

The aggregate market value of voting and non-voting common equity held by non-affiliates of the registrant as of June 30, 2009 was $2,381,862,953.

On February 22, 2010, there were 103,493,745 shares of common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant’s definitive proxy statement with respect to the 2010 annual meeting of the shareholders are incorporated by reference in Part III of this report. The definitive proxy statement or an amendment to this Form 10-K will be filed no later than 120 days after the close of registrant’s fiscal year.

CERTAIN STATEMENTS IN THIS ANNUAL REPORT ON FORM 10-K, INCLUDING BUT NOT LIMITED TO THOSE RELATING TO:

• THE CONSUMMATION OF THE COMPANY’S PROPOSED SPIN-OFF TRANSACTION AND THE TIMING, FORM AND TAX FREE NATURE THEREOF;

• THE COMPANY’S COST CONTROL INITIATIVES, BRAND STRATEGY, AGENCY RELATIONSHIPS, OFFSHORE LEVERAGE, COMMERCIAL AND INTERNATIONAL SALES EFFORTS, AND OTHER PLANS AND FOCUSES WITH RESPECT TO ITS TITLE INSURANCE BUSINESS;

• THE COMPANY’S PRACTICE OF ASSUMING AND CEDING LARGE TITLE INSURANCE RISKS THROUGH THE MECHANISM OF REINSURANCE;

• FUTURE PRICE ADJUSTMENTS FOR TITLE INSURANCE POLICIES;

• THE COMPANY’S CONTINUED EFFORTS TO FOCUS ON ORGANIC GROWTH, PRODUCT DEVELOPMENT AND MARGIN IMPROVEMENT AND TO STREAMLINE ITS BUSINESS;

• THE ADEQUACY OF THE COMPANY’S BANKING SUBSIDIARY’S ALLOWANCE FOR LOAN LOSSES;

• THE LIKELY DEGREE OF CHANGE TO THE COMPANY’S TITLE INSURANCE LOSS RATES;

• THE EFFECT OF LAWSUITS, REGULATORY AUDITS AND INVESTIGATIONS AND OTHER LEGAL PROCEEDINGS ON THE COMPANY’S FINANCIAL CONDITION, RESULTS OF OPERATIONS OR CASH FLOWS;

• FUTURE PAYMENT OF DIVIDENDS AND THE AMOUNT THEREOF;

• THE EFFECT OF PENDING AND RECENT ACCOUNTING PRONOUNCEMENTS ON THE COMPANY’S FINANCIAL STATEMENTS;

• THE IMPACT OF THE CONTINUED TIGHTENING OF MORTGAGE CREDIT AND THE UNCERTAINTY IN GENERAL ECONOMIC CONDITIONS ON THE COMPANY’S LINES OF BUSINESS;

• EXPECTED LOSS RATIOS FOR POLICY YEARS 2009, 2008 AND OTHER POLICY YEARS;

• FUTURE CLAIMS LEVELS FOR THE COMPANY’S TAX SERVICE OUTSOURCING BUSINESS;

• FUTURE IMPAIRMENT CHARGES;

• THE REALIZATION OF TAX BENEFITS ASSOCIATED WITH CERTAIN LOSSES;

• THE TIMING OF CLAIM PAYMENTS;

• THE IMPACT OF DIVIDEND, LOAN AND ADVANCE RESTRICTIONS ON THE COMPANY’S ABILITY TO MEET ITS CASH OBLIGATIONS;

• THE SUFFICIENCY OF THE COMPANY’S RESOURCES TO SATISFY OPERATIONAL CASH REQUIREMENTS;

• CREDIT LOSSES ON THE COMPANY’S NON-AGENCY MORTGAGE AND ASSET-BACKED SECURITIES PORTFOLIO;

• THE EFFECT OF THE CURRENT ENVIRONMENT ON THE POTENTIAL FOR CLAIMS ON LENDERS’ TITLE POLICIES;

• THE CONTINUED REINVESTMENT OF UNDISTRIBUTED EARNINGS IN THE COMPANY’S FOREIGN SUBSIDIARIES;

• ESTIMATED NET LOSS AND PRIOR SERVICE CREDIT AND CASH CONTRIBUTIONS RELATING TO PENSION PLANS;

• THE ANTICIPATED WEIGHTED AVERAGE PERIOD OF RECOGNITION OF STOCK OPTIONS AND RSUs; AND

• 2010 SALARIES AND BONUS AMOUNTS FOR EXECUTIVE OFFICERS;

2

ARE FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. THESE FORWARD-LOOKING STATEMENTS MAY CONTAIN THE WORDS “BELIEVE,” “ANTICIPATE,” “EXPECT,” “PLAN,” “PREDICT,” “ESTIMATE,” “PROJECT,” “WILL BE,” “WILL CONTINUE,” “WILL LIKELY RESULT,” OR OTHER SIMILAR WORDS AND PHRASES.

RISKS AND UNCERTAINTIES EXIST THAT MAY CAUSE RESULTS TO DIFFER MATERIALLY FROM THOSE SET FORTH IN THESE FORWARD-LOOKING STATEMENTS. FACTORS THAT COULD CAUSE THE ANTICIPATED RESULTS TO DIFFER FROM THOSE DESCRIBED IN THE FORWARD-LOOKING STATEMENTS INCLUDE:

• INTEREST RATE FLUCTUATIONS;

• CHANGES IN THE PERFORMANCE OF THE REAL ESTATE MARKETS;

• LIMITATIONS ON ACCESS TO PUBLIC RECORDS AND OTHER DATA;

• GENERAL VOLATILITY IN THE CAPITAL MARKETS;

• CHANGES IN APPLICABLE GOVERNMENT REGULATIONS;

• HEIGHTENED SCRUTINY BY LEGISLATORS AND REGULATORS OF THE COMPANY’S TITLE INSURANCE AND SERVICES SEGMENT AND CERTAIN OTHER OF THE COMPANY’S BUSINESSES;

• THE INABILITY TO CONSUMMATE THE SPIN-OFF TRANSACTION OR TO CONSUMMATE IT IN THE FORM ORIGINALLY PROPOSED AS A RESULT OF, AMONG OTHER FACTORS, THE INABILITY TO OBTAIN NECESSARY REGULATORY APPROVALS, THE FAILURE TO OBTAIN THE FINAL APPROVAL OF THE COMPANY’S BOARD OF DIRECTORS, THE INABILITY TO OBTAIN THIRD PARTY CONSENTS OR UNDESIRABLE CONCESSIONS OR ACCOMMODATIONS REQUIRED TO BE MADE TO OBTAIN SUCH CONSENTS, THE LANDSCAPE OF THE REAL ESTATE AND MORTGAGE CREDIT MARKETS, MARKET CONDITIONS, THE INABILITY TO TRANSFER ASSETS INTO THE ENTITY BEING SPUN-OFF OR UNFAVORABLE REACTIONS FROM CUSTOMERS, RATINGS AGENCIES, INVESTORS OR OTHER INTERESTED PERSONS;

• THE INABILITY TO REALIZE THE BENEFITS OF THE PROPOSED SPIN-OFF TRANSACTION AS A RESULT OF THE FACTORS DESCRIBED IMMEDIATELY ABOVE, AS WELL AS, AMONG OTHER FACTORS, INCREASED BORROWING COSTS, COMPETITION BETWEEN THE RESULTING COMPANIES, UNFAVORABLE REACTIONS FROM EMPLOYEES, THE INABILITY OF THE FINANCIAL SERVICES COMPANY TO PAY THE ANTICIPATED LEVEL OF DIVIDENDS, THE TRIGGERING OF RIGHTS AND OBLIGATIONS BY THE TRANSACTION OR ANY LITIGATION ARISING OUT OF OR RELATED TO THE SEPARATION;

• CONSOLIDATION AMONG THE COMPANY’S SIGNIFICANT CUSTOMERS AND COMPETITORS;

• UNFAVORABLE ECONOMIC CONDITIONS;

• IMPAIRMENTS IN THE COMPANY’S GOODWILL OR OTHER INTANGIBLE ASSETS;

• LOSSES IN THE COMPANY’S INVESTMENT PORTFOLIO;

• EXPENSES OF AND FUNDING OBLIGATIONS TO THE COMPANY’S PENSION PLAN;

• WEAKNESS IN THE COMMERCIAL REAL ESTATE MARKET AND INCREASES IN THE AMOUNT OR SEVERITY OF COMMERCIAL REAL ESTATE TRANSACTION CLAIMS;

• REGULATION OF TITLE INSURANCE RATES; AND

• OTHER FACTORS DESCRIBED IN THIS ANNUAL REPORT ON FORM 10-K.

THE FORWARD-LOOKING STATEMENTS SPEAK ONLY AS OF THE DATE THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE TO UPDATE FORWARD-LOOKING STATEMENTS TO REFLECT CIRCUMSTANCES OR EVENTS THAT OCCUR AFTER THE DATE THE FORWARD-LOOKING STATEMENTS ARE MADE.

3

PART I

Item 1.    Business

The Company

The Company was founded in 1894 as Orange County Title Company, succeeding to the business of two title abstract companies founded in 1889 and operating in Orange County, California. In 1924, the Company began issuing title insurance policies. In 1986, the Company began a diversification program which involved the acquisition and development of business information companies closely related to the real estate transfer and closing process. In 1998, the Company expanded its diversification program to include business information products and services outside of the real estate transfer and closing process.

On January 15, 2008, the Company announced its intention to separate its financial services companies from its information solutions companies via a spin-off transaction, resulting in two separate publicly traded entities. The Company continues to proceed with preparations for the anticipated separation, and currently expects the separation to occur during the first half of 2010, with a target date of June 1, 2010. The Company’s subsidiary, First American Financial Corporation, filed a Form 10 Registration Statement with the Securities and Exchange Commission on December 14, 2009, and Amendment No. 1 thereto on February 12, 2010, in preparation for the separation. The transaction remains subject to customary conditions, including final approval by the Board of Directors, effectiveness of the Form 10 Registration Statement, receipt of a tax ruling from the Internal Revenue Service and the approval of applicable regulatory authorities, some of which have already been received.

The Company is a California corporation and has its executive offices at 1 First American Way, Santa Ana, California 92707-5913. The Company’s telephone number is (714) 250-3000.

General

The First American Corporation, through its subsidiaries, is engaged in the business of providing business information and related products and services. The Company has five reporting segments that fall within two primary business groups, financial services and information solutions. The financial services group includes the Company’s title insurance and services segment and its specialty insurance segment. The title insurance and services segment provides title insurance, escrow or closing services and similar or related financial services domestically and internationally in connection with residential and commercial real estate transactions. It also provides thrift, trust and investment advisory services. Beginning on January 1, 2010, this segment is also in the business of maintaining, managing and providing access to automated title plant records and images that may be owned by the Company or other parties, which was previously carried on by the data and analytic solutions segment. The specialty insurance segment issues property and casualty insurance policies and sells home warranty products. The Company’s information and outsourcing solutions, data and analytic solutions and risk mitigation and business solutions segments comprise its information solutions group. The information and outsourcing solutions segment focuses on providing a wide-range of products and services including tax monitoring, flood zone certification and monitoring, building and maintaining geospatial proprietary software and databases, default management services, loan administration and production services, business process outsourcing and asset valuation and management services. The data and analytic solutions segment provides licenses and analyzes data relating to mortgage securities and loans and real property, offers risk management and collateral assessment analytics and provides database access tools and automated appraisal services. The risk mitigation and business solutions segment provides credit reporting solutions for mortgage and home equity needs, consumer credit reporting services, consumer credit reporting for the automotive dealer marketplace, automotive lead generation services, transportation credit reporting, motor vehicle record reporting, fleet management, criminal records reselling, specialty finance credit reporting, lead generation services, employment background screening, occupational health services, tax incentive services, hiring solutions, resident screening, software services and investigative services. Financial information regarding each of the Company’s business segments is included in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Item 8. Financial Statements and Supplementary Data” of Part II of this report.

4

The Company believes that it holds the number one market share position for many of its products and services, including flood zone determinations, based on the number of flood zone certification reports issued; tax monitoring services, based on the number of loans under service; credit reporting services to the United States mortgage lending industry, based on the number of credit reports issued; credit reports focusing on specialty borrowers in the United States, based on the number of credit reports issued; property data services, based on the number of inquiries; automated appraisals, based on the number of reports sold; and MLS services, based on the number of active desktops. The Company also believes that it holds the number two market share position for home warranty services, based on an extrapolation of market share statistics provided by regulators in Texas and California. The Company believes that it now holds the number two market share position for title insurance, based on premiums written. During 2008, LandAmerica Financial Group, Inc., believed to be the third largest provider of title insurance in the United States at the time, filed for bankruptcy protection and sold certain of its title insurance underwriters and other assets to Fidelity National Financial, Inc., which at the time the Company believed to be the second largest provider of title insurance, which combination produced the largest title insurance provider. The Company also believes it is a leading provider of broker price opinions, based upon the number of reports sold.

In 2009, 2008 and 2007 the Company derived 59%, 62% and 66% of its consolidated revenues, respectively, from title insurance products. A substantial portion of the revenues for the Company’s title insurance and services segment result from or relate to resales and refinancings of residential real estate and, to a lesser extent, from commercial transactions and new home transactions. Over one-half of the revenues in the Company’s data and analytic solutions and information and outsourcing solutions segments and approximately 19% of the revenues from the Company’s risk mitigation and business solutions segment also depend on real estate activity. The remaining portion of the data and analytic solutions and risk mitigation and business solutions segments’ revenues are less impacted by, or are isolated from, the volatility of real estate transactions. In the specialty insurance segment, revenues associated with the initial year of coverage in both the home warranty and property and casualty operations are impacted by volatility in real estate transactions. Traditionally, the greatest volume of real estate activity, particularly residential resale, has occurred in the spring and summer months. However, changes in interest rates, as well as other economic factors, can cause fluctuations in the traditional pattern of real estate activity.

The Financial Services Group

Title Insurance and Services Segment

The Company’s title insurance and services segment issues title insurance policies on residential and commercial property in the United States and offers similar products and services internationally. This segment also provides escrow and closing services, accommodates tax-deferred exchanges of real estate and provides investment advisory, trust, lending and deposit services.

Overview of Title Insurance Industry

In most real estate transactions, mortgage lenders and purchasers of real estate desire to be protected from loss or damage in the event of defects in the title they acquire. Title insurance is a means of providing such protection.

Title Policies.    Title insurance policies insure the interests of owners or lenders against defects in the title to real property. These defects include adverse ownership claims, liens, encumbrances or other matters affecting title. Title insurance policies are issued on the basis of a title report, which is typically prepared after a search of the public records, maps, documents and prior title policies to ascertain the existence of easements, restrictions, rights of way, conditions, encumbrances or other matters affecting the title to, or use of, real property. In certain instances, a visual inspection of the property is also made. To facilitate the preparation of title reports, copies of public records, maps, documents and prior title policies may be compiled and indexed to specific properties in an area. This compilation is known as a “title plant.”

5

The beneficiaries of title insurance policies are usually real estate buyers and mortgage lenders. A title insurance policy indemnifies the named insured and certain successors in interest against title defects, liens and encumbrances existing as of the date of the policy and not specifically excepted from its provisions. The policy typically provides coverage for the real property mortgage lender in the amount of its outstanding mortgage loan balance and for the buyer in the amount of the purchase price of the property. In some cases the policy might provide insurance in a greater amount where the buyer anticipates constructing improvements on the property. Coverage under a title insurance policy issued to a mortgage lender generally terminates upon repayment of the mortgage loan. Coverage under a title insurance policy issued to a buyer generally terminates upon the sale of the insured property unless the owner carries back a mortgage or makes certain warranties as to the title.

Before issuing title policies, title insurers typically seek to limit their risk of loss by accurately performing title searches and examinations. The major expenses of a title company relate to such searches and examinations, the preparation of preliminary reports or commitments and the maintenance of title plants, and not from claim losses as in the case of property and casualty insurers.

The Closing Process.    Title insurance is essential to the real estate closing process in most transactions involving real property mortgage lenders. In a typical residential real estate sale transaction, a real estate broker, lawyer, developer, lender or closer involved in the transaction orders title insurance on behalf of an insured. Once the order has been placed, a title insurance company or an agent typically conducts a title search to determine the current status of the title to the property. When the search is complete, the title company or agent prepares, issues and circulates a commitment or preliminary report to the parties to the transaction. The commitment or preliminary report identifies the conditions, exceptions and/or limitations that the title insurer intends to attach to the policy and identifies items appearing on the title that must be eliminated prior to closing.

The closing function, sometimes called an escrow in the western United States, is often performed by a lawyer, an escrow company or a title insurance company or agent, generally referred to as a “closer.” Once documentation has been prepared and signed, and mortgage lender payoff demands are in hand, the transaction is “closed.” The closer records the appropriate title documents and arranges the transfer of funds to pay off prior loans and extinguish the liens securing such loans. Title policies are then issued insuring the priority of the mortgage of the real property mortgage lender in the amount of its mortgage loan and the buyer in the amount of the purchase price. The time between the opening of the title order and the issuance of the title policy is usually between 30 and 90 days. Before a closing takes place, however, the closer requests that the title insurer provide an update to the commitment to discover any adverse matters affecting title and, if any are found, works with the seller to eliminate them so that the title insurer issues the title policy subject only to those exceptions to coverage which are acceptable to the title insurer, the buyer and the buyer’s lender.

Issuing the Policy: Direct vs. Agency.    A title policy can be issued directly by a title insurer or indirectly on behalf of a title insurer through agents, which are not themselves licensed as insurers. Where the policy is issued by a title insurer, the search is performed by or on behalf of the title insurer, and the premium is collected and retained by the title insurer. Where the policy is issued by an agent, the agent typically performs the search, examines the title, collects the premium and retains a portion of the premium. The agent remits the remainder of the premium to the title insurer as compensation for the insurer bearing the risk of loss in the event a claim is made under the policy. The percentage of the premium retained by an agent varies from region to region. A title insurer is obligated to pay title claims in accordance with the terms of its policies, regardless of whether it issues its policy directly or indirectly through an agent.

Premiums.    The premium for title insurance is due and earned in full when the real estate transaction is closed. Premiums generally are calculated with reference to the policy amount. The premium charged by a title insurer or an agent is subject to regulation in most areas. Such regulations vary from state to state.

6

The Company’s Title Insurance Operations

Overview.    The Company, through its principal title insurance subsidiary and such subsidiary’s affiliates, transacts its title insurance business through a network of direct operations and agents. Through this network, the Company issues policies in the 49 states that permit the issuance of title insurance policies and the District of Columbia. In Iowa, the Company provides title abstracts only because title insurance is not permitted by law. The Company also offers title insurance and similar products, as well as related services, either directly or through joint ventures in foreign countries, including Canada, the United Kingdom and various other established and emerging markets.

Beginning in 2007, in response to deteriorating market conditions and as part of an effort to enhance its operating efficiency and improve its margins, the Company began to focus on controlling costs by reducing employee count, consolidating offices, centralizing agency and administrative functions, optimizing management structure and rationalizing its brand strategy. The Company plans to continue these efforts where appropriate. In addition, the Company will continue to scrutinize the profitability of its agency relationships, increase its offshore leverage and develop new sales opportunities. Beginning at the end of 2008, the Company initiated an effort to optimize its claims handling process through, among other things, centralization of claims handling, enhanced corporate control over the claims process and claims process standardization. The Company substantially completed its claims centralization project during the third quarter of 2009.

Sales and Marketing.    Though the Company endeavors to educate consumers on the value of title insurance and the closing process, the Company can most efficiently market to its primary sources of business referrals, including escrow or closing service providers, real estate agents and brokers, developers, mortgage brokers , mortgage bankers, lenders and attorneys. In addition, the Company also markets its title insurance services directly to large corporate customers and mortgage lenders and servicers. The Company actively markets to mortgage servicers, foreclosure outsourcing providers and investors who are important sources of title insurance business during periods with high levels of foreclosures. The Company also markets its title insurance services to independent agents. The Company’s marketing efforts emphasize the combination of its products, the quality and timeliness of its services, process innovation and its national presence.

The Company provides its sales personnel with training in its product and service offerings, as well as selling techniques, and local management is responsible for hiring the sales staff and ensuring that sales personnel are properly trained. The Company also maintains a client relations group to coordinate sales to institutional customers, such as lenders, mortgage servicers, foreclosure outsourcing providers and investors.

The Company has expanded its commercial business base primarily through increased commercial sales efforts. Because commercial transactions involve higher coverage amounts and higher premiums, commercial title insurance business generally generates greater profit margins than does residential title insurance business. Though current market conditions have proven difficult for this business, the Company expects that on a relative basis, over the long term, these characteristics still apply. Accordingly, the Company plans to continue to emphasize its commercial sales program. The Company’s national commercial services division also has a dedicated sales force. One of the responsibilities of the sales personnel of this division is the coordination of marketing efforts directed at large real estate lenders and companies developing, selling, buying or brokering properties on a multi-state basis.

The Company supplements the efforts of its sales force with general advertising in various trade and professional journals.

International Operations.    Over the past 20 years, the Company has led the industry in global expansion by investing in the development and growth of operations in international markets. The Company now provides products and services in over 60 countries, and its international operations accounted for approximately 8% of its title revenues in 2009. Today the Company has direct operations and a physical presence in 12 countries including Canada and the United Kingdom. Additionally, the Company has partnered with leading local

7

companies to provide services in many other countries. According to data from the American Land Title Association, as of September 30, 2009, the Company’s reported overall title insurance market share was close to 60% internationally.

The Company’s range of international products and services is designed to lower its clients’ risk profiles and reduce their operating costs through enhanced operational efficiencies. In established markets, primarily British Commonwealth countries, the Company has combined title insurance with unique processing offerings to enhance the speed and efficiency of the mortgage and conveyancing processes.

The Company believes that key opportunities for growth exist not only in the relatively established markets, but also in the emerging markets that are heavily reliant on expensive manual business processes and dated technology and land registry systems. As the number of countries adopting Western style mortgage systems continues to increase and as the demand for greater efficiency in the real estate settlement process continues to grow, the Company is well situated to seize these opportunities because of its industry expertise, financial strength, existing international licenses and contacts around the world. For example, the Company is licensed or otherwise authorized to do business in thirty-nine countries and has partnered with entities authorized to do business in various additional countries.

Underwriting.    Before a title insurance policy is issued, a number of underwriting decisions are made. For example, matters of record revealed during the title search may require a determination as to whether an exception should be taken in the policy. The Company believes that it is important for the underwriting function to operate efficiently and effectively at all decision-making levels so that transactions may proceed in a timely manner. To perform this function, the Company has underwriters at the regional, divisional and corporate levels to whom the Company gives varying levels of underwriting authority.

Agency Operations.    The Company’s agreements with its agents state the conditions under which the agent is authorized to issue title insurance policies on the Company’s behalf. The agency agreement also prescribes the circumstances under which the agent may be liable to the Company if a policy loss occurs. Although such agency agreements typically are terminable without cause after a specified notice period has been met and are terminable immediately for cause, certain agents have negotiated terms that are more favorable to them. Beginning in early 2008, the Company intensified its effort to evaluate all of its agency relationships, including a review of premium splits, deductibles and claims. As a result, the Company terminated or renegotiated the terms of many of its agency relationships. The Company has also centralized the receipt of agency remittances and is in the process of centralizing other agent-related administrative activities, and it continues to evaluate the profitability of agency relationships.

The Company has an agent selection process and an agent audit program. In determining whether to engage an independent agent, the Company obtains information about the agent, including the agent’s experience and background. The Company maintains loss experience records for each agent and conducts periodic audits of its agents. The Company also maintains agent representatives and agent auditors. Agent auditors routinely perform an examination of the agent’s escrow trust accounts and supporting accounting records. In addition to these routine examinations, an expanded examination will be triggered if certain “warning signs” are evident. Warning signs that can trigger an expanded examination include the failure to implement required accounting controls, shortages of escrow funds and failure to remit title insurance premiums on a timely basis. Adverse findings in an agency audit may result in various actions, including, if warranted, termination of the agency relationship.

Title Plants.    The Company’s network of title plants constitutes one of its principal assets. A title search is conducted by searching the public records or utilizing a title plant holding duplicate public records. While public title records generally are indexed by reference to the names of the parties to a given recorded document, most title plants arrange their records on a geographic basis. Because of this difference, title plant records generally may be searched more efficiently, which the Company believes reduces the risk of errors associated with the search. Most title plants also index prior policies, adding to searching efficiency. Many title plants are automated, or available on-line. Certain offices utilize jointly owned plants or utilize a plant under a joint user agreement

8

with other title companies. In addition to these ownership interests, the Company is in the business of maintaining, managing and providing access to automated title plant records and images that may be owned by the Company or other parties. The Company believes that its title plants, whether wholly or partially owned or utilized under a joint user agreement, are among the best in the industry.

The Company’s title plants are carried on its consolidated balance sheets at original cost, which includes the cost of producing or acquiring interests in title plants or the appraised value of subsidiaries’ title plants at dates of acquisition for companies accounted for as purchases. Thereafter, the cost of daily maintenance of these plants is charged to expense as incurred. A properly maintained title plant has an indefinite life and does not diminish in value with the passage of time. Therefore, in accordance with generally accepted accounting principles, no provision is made for amortization of these plants. Since each document must be reviewed and indexed into the title plant, such maintenance activities constitute a significant item of expense. The Company is able to offset a portion of title plant maintenance costs through joint ownership and access agreements with other title insurers and title agents. The Company continually analyzes its title plants for impairment. This analysis includes, but is not limited to, the effects of obsolescence, duplication, demand and other economic events.

Reserves for Claims and Losses.    The Company provides for title insurance losses based upon its historical experience and other factors by a charge to expense when the related premium revenue is recognized. The resulting reserve for known claims and incurred but not reported claims reflects management’s best estimate of the total costs required to settle all claims reported to the Company and claims incurred but not reported, and is considered to be adequate for such purpose. Each period the reasonableness of the estimated reserves is assessed; if the estimate requires adjustment, such an adjustment is recorded.

In settling claims, the Company occasionally purchases and ultimately sells an insured’s interest in the underlying real property or the interest of a claimant adverse to the insured. These assets are carried at the lower of cost or fair value, less costs to sell, and are included in “Other assets” in the Company’s consolidated balance sheets.

Reinsurance and Coinsurance.    The Company plans to continue its practice of assuming and ceding large title insurance risks through the mechanism of reinsurance. In reinsurance arrangements, the primary insurer retains a certain amount of risk under a policy and cedes the remainder of the risk under the policy to the reinsurer. The primary insurer pays the reinsurer a premium in exchange for accepting this risk of loss. The primary insurer generally remains liable to its insured for the total risk, but is reinsured under the terms of the reinsurance agreement. Prior to 2010, the Company’s title reinsurance arrangements primarily involved other industry participants. Beginning in January of 2010, the Company established a global reinsurance program involving treaty reinsurance provided by a global syndicate of highly rated non-industry reinsurers. In addition to covering claims under policies issued while the program is in effect, the program also generally covers claims made under policies issued in prior years, as long as the losses are discovered while the program is in effect.

The Company also serves as a coinsurer in connection with certain transactions. In a coinsurance scenario, two or more insurers are selected by the insured and typically issue separate policies with respect to the subject property, with each coinsurer liable to the extent provided in the policy that it issues.

Competition.    The title insurance business is highly competitive. The number of competing companies and the size of such companies vary in the different areas in which the Company conducts business. Generally, in areas of major real estate activity, such as metropolitan and suburban localities, the Company competes with many other title insurers. Over 30 title insurance underwriters, for example, are members of the American Land Title Association, the title insurance industry’s national trade association. The Company’s major nationwide competitors in its principal markets include Fidelity National Financial, Inc., Stewart Title Guaranty Company and Old Republic International Corporation. The Company is currently the second largest provider of title insurance in the United States. During 2008, LandAmerica Financial Group, Inc., believed to be the third largest

9

provider of title insurance in the United States at the time, filed for bankruptcy protection and sold certain of its title insurance underwriters and other assets to Fidelity, which at the time the Company believed to be the second largest provider of title insurance, which combination produced the largest title insurance provider. In addition to these competitors, small nationwide, regional and local competitors as well as numerous agency operations throughout the country provide aggressive competition on the local level.

The Company believes that competition for title insurance business is based primarily on both the price of the policy and the quality and timeliness of the service, because parties to real estate transactions are usually concerned with time schedules and costs associated with delays in closing transactions. In certain transactions, such as those involving commercial properties, financial strength is also important. In those states where prices are established by regulatory authorities, the price of title insurance policies is not likely to be an important competitive factor. The Company continuously evaluates its pricing, and based on competitive, market and regulatory conditions and claims history, among other factors, intends to continue to adjust its prices as and where appropriate.

Trust and Investment Advisory Services.    Since 1960, the Company has conducted a general trust business in California, acting as trustee when so appointed pursuant to court order or private agreement. In 1985, the Company formed a banking subsidiary into which its subsidiary trust operation was merged. During August 1999, this subsidiary converted from a state-chartered bank to a federal savings bank. This subsidiary, First American Trust, FSB, offers investment advisory services and manages equity and fixed-income securities. As of December 31, 2009, this company managed $1.5 billion of assets, administered fiduciary and custodial assets having a market value in excess of $2.9 billion, had assets of $1.0 billion, deposits of $954.6 million and stockholder’s equity of $63.7 million.

Lending and Deposit Products.    During 1988, the Company acquired an industrial bank that accepts deposits and uses deposited funds to originate and purchase loans secured by commercial properties primarily in Southern California. As of December 31, 2009, this company, First Security Business Bank, had approximately $260.6 million of deposits and $161.9 million of loans outstanding.

Loans made or acquired during 2009 by the bank totaled $23.7 million, with an average new loan balance of $1,327,627. The average loan balance outstanding at December 31, 2009, was $678,130. Loans are made only on a secured basis, at loan-to-value percentages generally less than 70%. The bank specializes in making commercial real estate loans. The majority of the bank’s loans are made on a fixed-to-floating rate basis. The average coupon on the bank’s loan portfolio as of December 31, 2009, was 6.78%. A number of factors are included in the determination of average yield, principal among which are loan fees and closing points amortized to income, prepayment penalties recorded as income, and amortization of discounts on purchased loans. The bank’s primary competitors in the Southern California commercial real estate lending market are local community banks, other industrial banks and, to a lesser extent, commercial banks. The bank’s average loan to value was approximately 44% at December 31, 2009.

The performance of the bank’s loan portfolio is evaluated on an ongoing basis by management of the bank. The bank places a loan on non-accrual status when two payments become past due. When a loan is placed on non-accrual status, the bank’s general policy is to reverse from income previously accrued but unpaid interest. Income on such loans is subsequently recognized only to the extent that cash is received and future collection of principal is probable. Interest income on non-accrual loans that would have been recognized during the year ended December 31, 2009, if all of such loans had been current in accordance with their original terms, totaled $12,084.

10

The following table sets forth the amount of the bank’s non-performing loans as of the dates indicated.

	Year Ended December 31
	2009		2008		2007		2006		2005
	(in thousands)
Nonperforming Assets:
Loans accounted for on a nonaccrual basis	$	603	$	—	$	—	$	—	$	—
Total	$	603	$	—	$	—	$	—	$	—

Based on a variety of factors concerning the creditworthiness of its borrowers, the bank determined that it had one non-performing asset as of December 31, 2009.

The bank’s allowance for loan losses is established through charges to earnings in the form of provision for loan losses. Loan losses are charged to, and recoveries are credited to, the allowance for loan losses. The provision for loan losses is determined after considering various factors, such as loan loss experience, maturity of the portfolio, size of the portfolio, borrower credit history, the existing allowance for loan losses, current charges and recoveries to the allowance for loan losses, the overall quality of the loan portfolio, and current economic conditions, as determined by management of the bank, regulatory agencies and independent credit review specialists. While many of these factors are essentially a matter of judgment and may not be reduced to a mathematical formula, the Company believes that, in light of the collateral securing its loan portfolio, the bank’s current allowance for loan losses is an adequate allowance against foreseeable losses.

The following table provides certain information with respect to the bank’s allowance for loan losses as well as charge-off and recovery activity.

	Year Ended December 31
	2009			2008			2007			2006			2005
	(in thousands, except percentages)
Allowance for Loan Losses:
Balance at beginning of year	$	1,600		$	1,488		$	1,440		$	1,410		$	1,350
Charge-offs:
Real estate—mortgage		—			—			—			—			—
Assigned lease payments		—			—			—			—			—
		—			—			—			—			—
Recoveries:
Real estate—mortgage		—			—			—			—			—
Assigned lease payments		—			—			—			—			—
		—			—			—			—			—
Net (charge-offs) recoveries		—			—			—			—			—
Provision for losses		471			112			48			30			60
Balance at end of year	$	2,071		$	1,600		$	1,488		$	1,440		$	1,410
Ratio of net charge-offs during the year to average loans outstanding during the year		0	%		0	%		0	%		0	%		0	%

The adequacy of the bank’s allowance for loan losses is based on formula allocations and specific allocations. Formula allocations are made on a percentage basis, which is dependent on the underlying collateral, the type of loan and general economic conditions. Specific allocations are made as problem or potential problem loans are identified and are based upon an evaluation by the bank’s management of the status of such loans. Specific allocations may be revised from time to time as the status of problem or potential problem loans changes.

11

The following table shows the allocation of the bank’s allowance for loan losses and the percent of loans in each category to total loans at the dates indicated.

	Year Ended December 31
	2009			2008			2007			2006			2005
	Allowance		% of Loans	Allowance		% of Loans	Allowance		% of Loans	Allowance		% of Loans	Allowance		% of Loans
	(in thousands, except percentages)
Loan Categories:
Real estate-mortgage	$	2,071	100	$	1,600	100	$	1,488	100	$	1,440	100	$	1,410	100
Other		—	—		—	—		—	—		—	—		—	—
	$	2,071	100	$	1,600	100	$	1,488	100	$	1,440	100	$	1,410	100

Specialty Insurance Segment

Property and Casualty Insurance.    The Company’s property and casualty insurance business provides insurance coverage to residential homeowners and renters for liability losses and typical hazards such as fire, theft, vandalism and other types of property damage. The Company is licensed to issue policies in all 50 states and actively issues policies in 43 states. In its largest market, California, the Company also offers preferred risk auto insurance to better compete with other carriers offering bundled home and auto insurance. The Company markets its property and casualty insurance business using both direct distribution channels, including cross-selling through its existing closing-service activities, and through a network of independent brokers. Reinsurance is used extensively to limit risk associated with natural disasters such as windstorms, winter storms, wildfires and earthquakes.

Home Warranties.    The Company’s home warranty business provides residential service contracts that cover residential systems and appliances against failures that occur as the result of normal usage during the coverage period. Most of these policies are issued on resale residences, although policies are also available in some instances for new homes. Coverage is typically for one year and is renewable annually at the option of the contract holder and upon the Company’s approval. Coverage and pricing typically vary by geographic region. Fees for the warranties generally are paid at the closing of the home purchase or directly by the consumer and are recognized monthly over the initial contract period. Renewal premiums may be paid by a number of different options. In addition, the contract holder is responsible for a service fee for each trade call. First year warranties primarily are marketed through real estate brokers and agents, although the Company also markets directly to consumers. The Company generally sells renewals directly to consumers. The home warranty business currently operates in 34 states and the District of Columbia.

The Information Solutions Group

Information and Outsourcing Solutions Segment

The information and outsourcing solutions segment provides a wide-range of products and services, including tax monitoring, flood zone certification and monitoring, building and maintaining geospatial proprietary software and databases, default management services, loan administration and production services, business process outsourcing and asset valuation and management services. The segment’s primary source of revenue is large, national mortgage lenders; additional customers include, but are not limited to, regional mortgage lenders and brokers, credit unions, commercial banks, government agencies and property and casualty insurance companies. The segment is also responsible for the Company’s national joint ventures. One of these joint ventures, which provides products used in connection with loan originations, has generated a significant portion of the segment’s revenues in the past two years.

12

Tax Monitoring.    The Company’s tax monitoring service, established in 1987, advises mortgage originators and servicers of the status of property tax payments due on real estate securing their loans. In October 2003, the Company grew this business with the acquisition of Transamerica Finance Corporation’s tax monitoring business. The Company believes that it is currently the largest provider of tax monitoring services in the United States.

Under a typical contract the Company, on behalf of mortgage originators and servicers, monitors the real estate taxes owing on properties securing such originators’ and servicers’ mortgage loans for the life of such loans. In general, providers of tax monitoring services, such as the Company’s tax service, indemnify mortgage lenders against losses resulting from a failure to monitor delinquent taxes. Where a mortgage lender requires that tax payments be impounded on behalf of borrowers, the Company also may monitor and oversee the transfer of these monies to the taxing authorities and provide confirmation to lenders that such taxes have been paid. The Company also may indemnify mortgage lenders against losses for any failure to make such transfers.

The Company generally receives a fee for the loan at the time a life of the loan contract is entered into or the loan is funded and recognizes revenues from tax service contracts over the estimated duration of the contracts. However, income taxes are paid on the entire fee in the first two years of the contract. Although losses have increased over the past two years, historically, the Company’s loss experience has not been significant and therefore the Company has maintained minimal reserves for losses relating to its tax monitoring service because its losses have been relatively minor. In addition, when performing tax outsourcing the Company performs the servicers’ tax payment processing function for the life of the loan for an additional fee.

Flood Zone Certification.    In January 1995, the Company entered the flood zone certification business with the acquisition of Flood Data Services, Inc. In October 2003, the Company substantially expanded this business with the acquisition of Transamerica Flood Hazard Certification, Inc., one of the Company’s primary competitors in this business. This business furnishes to mortgage originators and servicers a report as to whether a subject property lies within a governmentally delineated flood hazard area and monitors the property for flood hazard status changes for as long as the loan is active. Federal legislation passed in 1994 requires that most mortgage lenders obtain a determination of the current flood zone status at the time each loan is originated and obtain updates during the life of the loan.

Outsourcing and Technology Solutions.    The Company’s outsourcing and technology solutions business sells software and provides services which assist mortgage servicing companies and financial institutions mitigate losses on mortgages that are in default as well as help manage foreclosures, maintain and sell real estate owned (“REO”) properties and process foreclosure claims. Its comprehensive suite of solutions supports the default lifecycle from borrower solicitation through settlement. Its loss mitigation services cover the lifecycle of the loss mitigation process and include portfolio analysis, data driven workout options, campaign management and back office fulfillment, including signature and recording services. Additionally, the Company provides flexible staffing models that give its clients the ability to respond to growing delinquency volumes while substantially eliminating capacity fluctuations.

Appraisal Services.    This segment also provides appraisal services to mortgage lenders, real estate agents, investors and other businesses requiring valuations of real property. These services generally consist of traditional appraisals, which require physical inspection and human analysis, and broker price opinion services, which value real property based on the opinions of real estate brokers and agents.

Data and Analytic Solutions Segment

The Company’s data and analytic solutions segment provides licenses and analyzes data relating to mortgage securities and loans and real property, offers risk management and collateral assessment analytics, provides database access tools to various businesses, in particular to businesses operating in the real estate industry, and provides automated valuation models which use data and sophisticated mathematical models and analytic tools to arrive at a property valuation. The Company’s data and analytic solutions segment’s primary

13

customers are commercial banks, mortgage lenders and brokers, investment banks, fixed income investors, real estate agents, property and casualty insurance companies and title insurance companies. The data offered by this segment includes loan information, property characteristic information and images of publicly recorded documents relating to real property, as well as information on mortgage-backed securities.

The data and analytic solutions segment was created in the Company’s First American Real Estate Solutions LLC (“FARES”) joint venture with an affiliate of Experian Group Limited in January 1998. Since that time this segment has grown through a number of significant acquisitions. In August 2000, the Company combined its property data business with Transamerica Corporation’s competing business. At the time the Company owned 80% of the resulting entity. During 2004, the Company purchased the remaining 20%. In April 2005, the Company expanded its offering of analytic products with the acquisition of LoanPerformance. This company provides mortgage information and mortgage performance and risk analytics largely to mortgage investors, originators and servicers. In February 2007, the Company combined its property data and related analytics businesses with CoreLogic Systems, Inc., a provider of mortgage risk assessment and fraud prevention solutions. The former stockholders of CoreLogic own approximately 18% of the combined entity. On January 1, 2010, the Company’s business of maintaining, managing and providing access to automated title plant records and images that may be owned by the Company or other parties, became part of the title insurance and services segment.

Risk Mitigation and Business Solutions Segment

The Company’s risk mitigation and business solutions segment is comprised entirely of the Company’s First Advantage Corporation (“First Advantage”) subsidiary, which was, until November 18, 2009, a public company whose shares of Class A common stock traded on the NASDAQ Global Market. First Advantage was formed in the 2003 merger of the Company’s screening information segment with US SEARCH.com, Inc. Since that time First Advantage has grown substantially through acquisitions. In particular, in September 2005, the Company contributed its credit information group to First Advantage in exchange for additional Class B common stock of First Advantage. In November 2009, the Company completed the acquisition of the publicly held shares of First Advantage. As a result, First Advantage is now a wholly-owned subsidiary of the Company.

First Advantage provides credit services, data services, employer services, multifamily services, and investigative and litigation support services. The credit services business offers lenders credit reporting solutions for mortgage and home equity needs, provides consumer credit reporting services and serves the automotive dealer marketplace by delivering consolidated consumer credit reports and automotive lead generation services. The data services business provides transportation credit reporting, motor vehicle record reporting, fleet management, criminal records reselling, specialty finance credit reporting and lead generation services. The employer services business includes employment background screening, occupational health services, tax incentive services and hiring solutions. The multifamily services business provides resident screening and software services. The investigative and litigation support services business provides all investigative services.

Acquisitions

Commencing in the 1960s, the Company initiated a growth program with a view to becoming a nationwide provider of title insurance. This program included expansion into new geographic markets through internal growth and selective acquisitions. In 1986, the Company began expanding into other real estate business information services. In 1998, the Company expanded its diversification program to include business information companies outside of the real estate transfer and closing process. Through 2007, the Company had made numerous strategic acquisitions designed to expand its direct title operations, as well as the range of services it can provide to its customers, and to diversify its revenues and earnings. Beginning in 2007, the number of acquisitions slowed considerably, as the Company focused on organic growth, product development and margin improvement. During 2009, the Company undertook to buyout minority investors in certain of its subsidiaries, including the purchase of the publicly held shares of First Advantage and the entry into an agreement regarding the purchase of the outstanding noncontrolling interest in the Company’s FARES joint venture.

14

Regulation

The title insurance business is heavily regulated by state insurance regulatory authorities. These authorities generally possess broad powers with respect to the licensing of title insurers, the types and amounts of investments that title insurers may make, insurance rates, forms of policies and the form and content of required annual statements, as well as the power to audit and examine title insurers. Under state laws, certain levels of capital and surplus must be maintained and certain amounts of securities must be segregated or deposited with appropriate state officials. Various state statutes require title insurers to defer a portion of all premiums in a reserve for the protection of policyholders and to segregate investments in a corresponding amount. Further, most states restrict the amount of dividends and distributions a title insurer may make to its shareholders.

The Company’s property and casualty businesses are subject to regulation by state insurance regulators in the states in which they transact business.

The nature and extent of regulation to which insurance companies are subject may vary from jurisdiction to jurisdiction, but typically involves prior approval of the acquisition of “control” of an insurance company, regulation of certain transactions entered into by an insurance company with any of its affiliates, the amount and payment of dividends by an insurance company, approval of premium rates and policy forms for many lines of insurance, standards of solvency and minimum amounts of capital and surplus which must be maintained. In order to issue policies on a direct basis in a state, the property and casualty insurer must generally be licensed by such state. In certain circumstances, such as placements through licensed surplus lines brokers, it may conduct business without being admitted and without being subject to rate and policy form approvals.

The Company’s home warranty business is subject to regulation in some states by insurance authorities or other applicable regulatory entities. The Company’s federal savings bank and thrift are both subject to regulation by the Federal Deposit Insurance Corporation. In addition, the federal savings bank is regulated by the United States Department of the Treasury’s Office of Thrift Supervision, and the thrift is regulated by the California Department of Financial Institutions.

Investment Policies

Subject to oversight by the Company’s Board of Directors, the Company’s investment activities are overseen at the parent company by an investment committee made up of certain senior executives, which is advised by, and has delegated certain functions to, an investment advisory committee. The investment advisory committee’s members include the Company’s portfolio manager and certain treasury department personnel. Certain day-to-day investment decisions have been delegated to the investment advisory committee, to be made within the guidelines and pursuant to the direction provided by the investment committee from time to time. Policy setting, oversight, and significant individual investment decisions occur at the investment committee level. In addition, a number of the Company’s regulated subsidiaries, including its title insurance underwriters, property and casualty insurance companies and federal savings bank are required to oversee their own investments and maintain investment committees at the subsidiary level. The investment policies and objectives of these regulated subsidiaries depend to a large extent on their particular business and regulatory considerations. For example, the Company’s federal savings bank is required to maintain at least 65% of its asset portfolio in loans or securities that are secured by real estate. The bank currently does not make real estate loans, and therefore fulfills this regulatory requirement predominately through investments in mortgage backed securities. In addition, state laws impose certain restrictions upon the types and amounts of investments that may be made by the Company’s regulated insurance subsidiaries.

Pursuant to the Company’s investment policy, fiduciary funds are to be managed in a manner designed to ensure return of the principal to the underlying beneficiaries and, where appropriate, an investment return to the Company. The policy further provides that operating and investment funds are to be managed to balance the Company’s earnings, liquidity, regulatory and risk objectives, and that investments should not expose the Company to excessive levels of credit risk, interest (including call, prepayment and extension) risk or liquidity risk.

15

As of December 31, 2009, the Company’s debt and equity investment securities portfolio consists of approximately 96% of fixed income securities. As of that date, over 83% of the Company’s fixed income investments are held in securities that are United States government-backed or rated AAA, and approximately 95% of the fixed income portfolio is rated or classified as investment grade. Percentages are based on the amortized cost basis of the securities. Credit ratings are based on Standard & Poor’s (“S&P”) and Moody’s published ratings. If a security was rated differently by both rating agencies, the lower of the two ratings was selected.

In addition to its debt and equity investment securities portfolio, the Company maintains certain money-market and other short-term investments. The Company also holds strategic equity investments in companies engaged in the title insurance, settlement services and data and analytics industries.

Employees

As of December 31, 2009, the Company employed 30,922 people on either a part-time or full-time basis. Of these employees, approximately 33% are employed outside of the United States and approximately 5% are employed at unconsolidated subsidiaries.

Available Information

The Company maintains a website, www.firstam.com, which includes financial information and other information for investors, including open and closed title insurance orders (which typically are posted approximately 20 days after the end of each calendar month). The Company’s Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available through the “Investors” page of the website as soon as reasonably practicable after the Company electronically files such material with, or furnishes it to, the Securities and Exchange Commission. The Company’s website and the information contained therein or connected thereto are not intended to be incorporated into this Annual Report on Form 10-K, or any other filing with the Securities and Exchange Commission unless the Company expressly incorporates such materials.

Item 1A.    Risk Factors

You should carefully consider each of the following risk factors and the other information contained in this Annual Report on Form 10-K. The Company faces risks other than those listed here, including those that are unknown to the Company and others of which the Company may be aware but, at present, considers immaterial. Because of the following factors, as well as other variables affecting the Company’s operating results, past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods.

1. Conditions in the real estate market generally impact the demand for a substantial portion of the Company’s products and services

Demand for a substantial portion of the Company’s products and services generally decreases as the number of real estate transactions in which its products and services are purchased decreases. The number of real estate transactions in which the Company’s products and services are purchased decreases in the following situations:

• when mortgage interest rates are high or rising;

• when the availability of credit, including commercial and residential mortgage funding, is limited; and

• when real estate values are declining.

16

2. Unfavorable economic conditions may have a material adverse effect on the Company

Uncertainty and negative trends in general economic conditions in the United States and abroad, including significant tightening of credit markets and a general decline in the value of real property, historically have created a difficult operating environment for the Company’s businesses and other companies in its industries. In addition, the Company holds investments in entities, such as title agencies, settlement service providers, data and analytics providers and property and casualty insurance companies, and instruments, such as mortgage backed securities, which may be negatively impacted by these conditions. The Company also owns a federal savings bank into which it deposits some of its own funds and some funds held in trust for third parties. This bank invests those funds and any realized losses incurred will be reflected in the Company’s consolidated results. The likelihood of such losses, which generally would not occur if the Company were to deposit these funds in an unaffiliated entity, increases when economic conditions are unfavorable. Depending upon the ultimate severity and duration of any economic downturn, the resulting effects on the Company could be materially adverse, including a significant reduction in revenues, earnings and cash flows, challenges to the Company’s ability to satisfy covenants or otherwise meet its obligations under debt facilities, difficulties in obtaining access to capital, challenges to the Company’s ability to pay dividends at currently anticipated levels, deterioration in the value of its investments and increased credit risk from customers and others with obligations to the Company.

3. Unfavorable economic or other conditions could cause the Company to write off a portion of its goodwill and other intangible assets

The Company performs an impairment test of the carrying value of goodwill and other indefinite-lived intangible assets annually in the fourth quarter or sooner if circumstances indicate a possible impairment. Finite-lived intangible assets are subject to impairment tests on a periodic basis. Factors that may be considered in connection with this review include, without limitation, underperformance relative to historical or projected future operating results, reductions in the Company’s stock price and market capitalization, increased cost of capital and negative macroeconomic, industry and company-specific trends. These and other factors could lead to a conclusion that goodwill or other intangible assets are no longer fully recoverable, in which case the Company would be required to write off the portion believed to be unrecoverable. Total goodwill and other intangible assets reflected on the Company’s consolidated balance sheet as of December 31, 2009 is approximately $2.9 billion. Any substantial goodwill and other intangible asset impairments that may be required could have a material adverse effect on the Company’s results of operations, financial condition and liquidity.

4. A downgrade by ratings agencies, reductions in statutory surplus maintained by the Company’s title insurance underwriters or a deterioration in other measures of financial strength may negatively affect the Company’s results of operations and competitive position

Certain of the Company’s customers use measurements of the financial strength of the Company’s title insurance underwriters, including, among others, ratings provided by ratings agencies and levels of statutory surplus maintained by those underwriters, in determining the amount of a policy they will accept and the amount of reinsurance required. Each of the major ratings agencies currently rates the Company’s title insurance operations. These ratings provide the agencies’ perspectives on the financial strength, operating performance and cash generating ability of those operations. These agencies continually review these ratings and the ratings are subject to change. Statutory surplus, or the amount by which statutory assets exceed statutory liabilities, is also a measure of financial strength. Accordingly, if the ratings or statutory surplus of these title insurance underwriters are reduced from their current levels, or if there is a deterioration in other measures of financial strength, the Company’s results of operations, competitive position and liquidity could be adversely affected.

5. Failures at financial institutions at which the Company deposits funds could adversely affect the Company

The Company deposits substantial funds in financial institutions. These funds include amounts owned by third parties, such as escrow deposits. Should one or more of the financial institutions at which deposits are

17

maintained fail, there is no guarantee that the Company would recover the funds deposited, whether through Federal Deposit Insurance Corporation coverage or otherwise. In the event of any such failure, the Company also could be held liable for the funds owned by third parties.

6. Changes in government regulation could prohibit or limit the Company’s operations or make it more burdensome to conduct such operations

Many of the Company’s businesses, including its title insurance, property and casualty insurance, home warranty, thrift, trust and investment businesses, are regulated by various federal, state, local and foreign governmental agencies. These and other of the Company’s businesses also operate within statutory guidelines. Changes in the applicable regulatory environment, statutory guidelines or interpretations of existing regulations or statutes, enhanced governmental oversight or efforts by governmental agencies to cause customers to refrain from using the Company’s products or services could prohibit or limit its future operations or make it more burdensome to conduct such operations. These changes may compel the Company to reduce its prices, may restrict its ability to implement price increases or acquire assets or businesses, may limit the manner in which the Company conducts its business or otherwise may have a negative impact on its ability to generate revenues, earnings and cash flows.

7. Scrutiny of the Company’s businesses and the industries in which it operates by governmental entities and others could adversely affect its operations and financial condition

The real estate settlement services industry, an industry in which the Company generates a substantial portion of its revenue and earnings, has become subject to heightened scrutiny by regulators, legislators, the media and plaintiffs’ attorneys. Though often directed at the industry generally, these groups may also focus their attention directly on the Company’s businesses. In either case, this scrutiny may result in changes which could adversely affect the Company’s operations and, therefore, its financial condition and liquidity.

Governmental entities have inquired into certain practices in the real estate settlement services industry to determine whether certain of the Company’s businesses or its competitors have violated applicable laws, which include, among others, the insurance codes of the various jurisdictions and the Real Estate Settlement Procedures Act and similar state and federal laws. Departments of insurance in the various states, either separately or in conjunction with federal regulators, also periodically conduct inquiries, generally referred to at the state level as “market conduct exams,” into the practices of title insurance companies in their respective jurisdictions. Further, from time to time plaintiffs’ lawyers may target the Company and other members of the Company’s industry with lawsuits claiming legal violations or other wrongful conduct. These lawsuits may involve large groups of plaintiffs and claims for substantial damages. Any of these types of inquiries or proceedings may result in a finding of a violation of the law or other wrongful conduct and may result in the payment of fines or damages or the imposition of restrictions on the Company’s conduct which could impact its operations and financial condition. Moreover, these laws and standards of conduct often are ambiguous and, thus, it may be difficult to ensure compliance. This ambiguity may force the Company to mitigate its risk by settling claims or by ending practices that generate revenues, earnings and cash flows.

8. The Company may find it difficult to acquire necessary data

Certain data used and supplied by the Company are subject to regulation by various federal, state and local regulatory authorities. Compliance with existing federal, state and local laws and regulations with respect to such data has not had a material adverse effect on the Company’s results of operations, financial condition or liquidity to date. Nonetheless, federal, state and local laws and regulations in the United States designed to protect the public from the misuse of personal information in the marketplace and adverse publicity or potential litigation concerning the commercial use of such information may affect the Company’s operations and could result in substantial regulatory compliance expense, litigation expense and a loss of revenue. The suppliers of data to the Company face similar burdens and, consequently, the Company may find it financially burdensome to acquire necessary data.

18

9. Regulation of title insurance rates could adversely affect the Company’s results of operations

Title insurance rates are subject to extensive regulation, which varies from state to state. In many states the approval of the applicable state insurance regulator is required prior to implementing a rate change. This regulation could hinder the Company’s ability to promptly adapt to changing market dynamics through price adjustments, which could adversely affect its results of operations, particularly in a rapidly declining market.

10. As a holding company, the Company depends on distributions from its subsidiaries, and if distributions from its subsidiaries are materially impaired, the Company’s ability to declare and pay dividends may be adversely affected; in addition, insurance and other regulations may limit the amount of dividends, loans and advances available from the Company’s insurance subsidiaries

The Company is a holding company whose primary assets are investments in its operating subsidiaries. The Company’s ability to pay dividends is dependent on the ability of its subsidiaries to pay dividends or repay funds. If the Company’s operating subsidiaries are not able to pay dividends or repay funds, the Company may not be able to fulfill parent company obligations and/or declare and pay dividends to its shareholders. Moreover, pursuant to insurance and other regulations under which the Company’s insurance subsidiaries operate, the amount of dividends, loans and advances available is limited. Under such regulations, the maximum amount of dividends, loans and advances available in 2010 from these insurance subsidiaries, is $258.0 million.

11. The Company’s pension plan is currently underfunded and pension expenses and funding obligations could increase significantly as a result of the weak performance of financial markets and its effect on plan assets

The Company’s defined benefit pension plan was closed to new entrants effective December 31, 2001 and amended to “freeze” all benefit accruals as of April 30, 2008. The Company’s future funding obligations for this plan depend, among other factors, upon the future performance of assets held in trust for the plan. The pension plan was underfunded as of December 31, 2009 by approximately $99.4 million and the Company may need to make significant contributions to the plan. In addition, pension expenses and funding requirements may also be greater than currently anticipated if the market values of the assets held by the pension plan decline or if the other assumptions regarding plan earnings and expenses require adjustment. The Company’s obligations under this plan could have a material adverse effect on its results of operations, financial condition and liquidity.

12. Weakness in the commercial real estate market or an increase in the amount or severity of claims in connection with commercial real estate transactions could adversely affect the Company’s results of operations

The Company issues title insurance policies in connection with commercial real estate transactions. Premiums paid and limits on these policies are large relative to policies issued on residential transactions. Because a claim under a single policy could be significant, title insurers often seek reinsurance or coinsurance from other insurance companies, both within and outside the industry. The Company both receives and provides such coverage. Additionally, the pretax margin derived from these policies generally is higher than on other policies. Disruptions in the commercial real estate market, including limitations on available credit and defaults on loans secured by commercial real estate, may result in a decrease in the number of commercial policies issued by the Company and/or an increase in the number of claims it incurs on commercial policies. As a reference, commercial premiums earned by the Company in 2009 decreased nearly 50 percent compared with the amount earned in 2006. A further decrease in the number of commercial policies issued by the Company or an increase in the amount or severity of claims we incur on commercial policies could adversely affect the Company’s results of operations.

13. Actual claims experience could materially vary from the expected claims experience reflected in the Company’s reserve for incurred but not reported (“IBNR”) title claims

Title insurance policies are long-duration contracts with the majority of the claims reported within the first few years following the issuance of the policy. Generally, 70 to 80 percent of claim amounts become known in

19

the first five years of the policy life, and the majority of IBNR reserves relate to the five most recent policy years. A material change in expected ultimate losses and corresponding loss rates for policy years older than five years, while possible, is not considered reasonably likely. However, changes in expected ultimate losses and corresponding loss rates for recent policy years are considered likely and could result in a material adjustment to the IBNR reserves. Based on historical experience, management believes a 50 basis point change to the loss rates for the most recent policy years, positive or negative, is believed to be reasonably likely given the long duration nature of a title insurance policy. For example, if the expected ultimate losses for each of the last five policy years increased or decreased by 50 basis points, the resulting impact on the Company’s IBNR reserve would be an increase or decrease, as the case may be, of $123.3 million. The estimates made by management in determining the appropriate level of IBNR reserves could ultimately prove to be inaccurate and actual claims experience may vary from the expected claims experience.

14. Systems interruptions and intrusions may impair the delivery of the Company’s products and services

System interruptions and intrusions may impair the delivery of the Company’s products and services, resulting in a loss of customers and a corresponding loss in revenue. The Company’s businesses depend heavily upon computer systems located in its data centers. Certain events beyond the Company’s control, including natural disasters, telecommunications failures and intrusions into the Company’s systems by third parties could temporarily or permanently interrupt the delivery of products and services. These interruptions also may interfere with suppliers’ ability to provide necessary data and employees’ ability to attend work and perform their responsibilities.

15. The Company may not be able to realize the benefits of its offshore strategy

The Company utilizes lower cost labor in foreign countries, such as India and the Philippines, among others. These countries are subject to relatively high degrees of political and social instability and may lack the infrastructure to withstand natural disasters. Such disruptions could decrease efficiency and increase the Company’s costs in these countries. Weakness of the U.S. dollar in relation to the currencies used in these foreign countries may also reduce the savings achievable through this strategy. Furthermore, the practice of utilizing labor based in foreign countries has come under increased scrutiny in the United States and, as a result, some of the Company’s customers may require it to use labor based in the United States. The Company may not be able to pass on the increased costs of higher priced United States-based labor to its customers.

16. The Company may not be able to consummate the spin-off transaction, consummate such transaction in its originally proposed form, or realize the anticipated benefits thereof

On January 15, 2008, the Company announced its intention to spin-off its financial services businesses, consisting primarily of its title insurance and specialty insurance reporting segments, into a separate public company. The proposed transaction is highly complex. Because, among other factors, a number of the Company’s businesses are regulated and intertwined and the Company is a party to a multitude of transactions, the completion of the transaction may require significant time, effort and expense. This could lead to a distraction from the day to day operations of the Company’s business, which could adversely affect those operations. In addition, the transaction will require certain regulatory approvals and the final approval of the Company’s Board of Directors, and may require other third party consents, which could be withheld, or the receipt of which could require the Company to make undesirable concessions or accommodations. The landscape of the real estate and mortgage credit markets also has changed substantially since early 2008, including the dissolution or expected dissolution of certain financial institutions, the bankruptcy of a large competitor of the Company and further consolidation among the Company’s current and potential customers. Market conditions also have put pressure on the revenues, earnings and cash flows of participants in the industries in which the Company operates, including the Company. For these reasons, as well as other potential factors such as the inability to transfer assets into the entity being spun-off or unfavorable reactions from customers, ratings agencies, investors or other interested persons, the Company may not be able to consummate the spin-off transaction or may not be able to consummate the transaction in the form originally proposed. Should the transaction be consummated, factors in

20

addition to those described above could prevent one or both of the resulting companies from being able to realize the anticipated benefits of the separation. These factors include increased borrowing costs, competition between the resulting companies, unfavorable reactions from employees, any inability of the financial services company to pay the anticipated level of dividends, the triggering of rights and obligations by the transaction or any litigation arising out of or related to the separation.

17. Product migration may result in decreased revenue

Customers of many real estate settlement services the Company provides increasingly require these services to be delivered faster, cheaper and more efficiently. Many of the traditional products it provides are labor and time intensive. As these customer pressures increase, the Company may be forced to replace traditional products with automated products that can be delivered electronically and with limited human processing. Because many of these traditional products have higher prices than corresponding automated products, the Company’s revenues may decline.

18. Increases in the size of the Company’s customers enhance their negotiating position with respect to pricing and terms and may decrease their need for the services offered by the Company

Many of the Company’s customers are increasing in size as a result of consolidation or the failure of their competitors. As a result, the Company may derive a higher percentage of its revenues from a smaller base of customers, which would enhance the ability of these customers to negotiate, where permitted by law, more favorable pricing and more favorable terms for the Company’s products and services. Moreover, these larger customers may prove more capable of performing in-house some or all of the services the Company provides and, consequently, their demand for its products and services may decrease. These circumstances could adversely affect the Company’s revenues and profitability.

19. Certain provisions of the Company’s articles of incorporation may reduce the likelihood of any unsolicited acquisition proposal or potential change of control that the Company’s shareholders might consider favorable

The Company’s restated articles of incorporation authorize the issuance of “blank check” preferred stock with such designations, rights and preferences as may be determined from time to time by the Company’s Board of Directors. Accordingly, the Company’s board is empowered, without further shareholder action, to issue shares or series of preferred stock with dividend, liquidation, conversion, voting or other rights that could adversely affect the voting power or other rights, including the ability to receive dividends, of the Company’s common shareholders. The issuance of such preferred stock could be utilized, under certain circumstances, as a method of discouraging an unsolicited acquisition proposal or delaying, deferring or preventing a change of control transaction that might involve a premium price or otherwise be considered favorably by the Company’s shareholders. Although the Company has no present intention of issuing any additional shares or series of preferred stock, the Company cannot guarantee that it will not make such an issuance in the future.

20. The Company’s investment portfolio is subject to certain risks and could experience losses

The Company maintains a substantial investment portfolio, primarily consisting of fixed income securities (including mortgage-backed and asset-backed securities), but also including money-market and other short-term investments, as well as some common and preferred stock. Securities in the Company’s investment portfolio are subject to certain economic and financial market risks, such as credit risk, interest rate (including call, prepayment and extension) risk and/or liquidity risk. The risk of loss associated with the portfolio is increased during periods, such as the present period, of instability in credit markets and economic conditions. If the carrying value of the investments exceeds the fair value, and the decline in fair value is deemed to be other-than-temporary, the Company will be required to write down the value of the investments, which could have a material adverse effect on the Company’s results of operations and financial condition.

21

Item 1B.    Unresolved Staff Comments

None.

Item 2.    Properties

The Company maintains its executive offices at MacArthur Place in Santa Ana, California. In 2005, the Company expanded its three-building office campus through the addition of two four-story office buildings totaling approximately 226,000 square feet, a two-story, free standing, 52,000 square foot technology center and a two-story parking structure, bringing the total square footage to approximately 490,000 square feet. The original three office buildings, totaling approximately 210,000 square feet, and the fixtures thereto and underlying land, are subject to a deed of trust and security agreement securing payment of a promissory note evidencing a loan made in October 2003, to the Company’s principal title insurance subsidiary in the original sum of $55.0 million. This loan is payable in monthly installments of principal and interest, is fully amortizing and matures November 1, 2023. The outstanding principal balance of this loan was $43.9 million as of December 31, 2009.

As of December 31, 2006, the Company’s information and outsourcing solutions segment relocated most of its national operations from a facility in Dallas, Texas to a location in Westlake, Texas. The Company entered into a lease expiring in 2017 on the Westlake, Texas facility, which comprises approximately 729,000 square feet. The Company’s title insurance segment occupies a portion of this facility.

In 1999, the Company completed the construction of two office buildings in Poway, California. These two buildings, which are owned by the Company’s title insurance subsidiary and are leased to the information solutions group, total approximately 153,000 square feet and are located on a 17 acre parcel of land.

One of the Company’s subsidiaries, which is part of the data and analytic solutions segment, has leased approximately 127,000 square feet of a multi-tenant facility in the Bagmane Technology Park in Bangalore, India. The lease expires at the end of 2011. In addition, a subsidiary of the Company that is part of the title insurance and services segment has leased an aggregate of approximately 134,000 square feet of office space in four buildings of the International Technology Park, also located in Bangalore. Five of the six leases associated with this space expire in 2012 and the sixth expires in 2010. The Company has the option to terminate all of the leases in the International Technology Park in 2011.

The office facilities occupied by the Company or its subsidiaries are, in all material respects, in good condition and adequate for their intended use.

Item 3.    Legal Proceedings

The Company and its subsidiaries have been named in various lawsuits, most of which relate to their title insurance operations. In cases where it has been determined that a loss is both probable and reasonably estimable, a liability representing the best estimate of the Company’s financial exposure based on known facts has been recorded. In accordance with accounting guidance, the Company maintained a reserve for these lawsuits totaling $18.9 million at December 31, 2009. Actual losses may materially differ from the amounts recorded. The Company does not believe that the ultimate resolution of these cases, either individually or in the aggregate, will have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

The Company’s title insurance, property and casualty insurance, home warranty, thrift, trust and investment advisory businesses are regulated by various federal, state and local governmental agencies. Many of the Company’s other businesses operate within statutory guidelines. Consequently, the Company may from time to time be subject to audit or investigation by such governmental agencies. Currently, governmental agencies are auditing or investigating certain of the Company’s operations. These audits or investigations include inquiries into, among other matters, pricing and rate setting practices in the title insurance industry, competition in the title insurance industry, title insurance customer acquisition and retention practices and asset valuation services. With respect to matters where the Company has determined that a loss is both probable and reasonably estimable, the

22

Company has recorded a liability representing its best estimate of the financial exposure based on known facts. In accordance with accounting guidance, the Company maintained a reserve for these matters totaling $2.0 million at December 31, 2009. While the ultimate disposition of each such audit or investigation is not yet determinable, the Company does not believe that individually or in the aggregate, they will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. These audits or investigations could result in changes to the Company’s business practices which could ultimately have a material adverse impact on the Company’s financial condition, results of operations or cash flows.

The Company’s subsidiaries also are involved in numerous ongoing routine legal and regulatory proceedings related to their operations. While the ultimate disposition of each proceeding is not determinable, the Company does not believe that any of such proceedings, individually or in the aggregate, will have a material adverse effect on its financial condition, results of operations or cash flows.

Item 4.    Submission of Matters to a Vote of Security Holders

The annual meeting of shareholders of the Company was held on December 8, 2009. The names of the persons who were nominated to serve as directors of the Company for the ensuing year are listed below, together with a tabulation of the results of the voting at the annual meeting with respect to each nominee. All nominees were elected.

Name of Nominee	Votes For	Votes Withheld
George L. Argyros	81,449,327	1,178,087
Bruce S. Bennett	81,884,366	743,048
Matthew B. Botein	80,400,487	2,226,927
J. David Chatham	81,156,515	1,470,899
Glenn C. Christenson	81,996,121	631,293
William G. Davis	73,033,438	9,593,976
James L. Doti	52,961,955	29,665,459
Lewis W. Douglas, Jr.	79,744,818	2,882,596
Christopher V. Greetham	81,957,990	669,424
Parker S. Kennedy	81,482,586	1,144,828
Thomas C. O’Brien	81,471,628	1,155,786
Frank O’Bryan	81,489,327	1,138,087
Roslyn B. Payne (1)	77,512,308	5,115,106
John W. Peace	81,875,826	751,588
D. Van Skilling	81,547,835	1,079,579
Herbert B. Tasker	81,645,894	981,520
Virginia M. Ueberroth	81,425,245	1,202,169
Mary Lee Widener	80,176,774	2,450,640

(1) On December 28, 2009, Roslyn B. Payne resigned from the Board of Directors.

At the meeting, the shareholders of the Company also voted to ratify the Audit Committee’s selection of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for 2009, with 81,903,257 votes for, 423,372 votes against, 300,785 votes abstaining and no broker non-votes.

At the meeting, a proposal to reincorporate the Company in Delaware was defeated, with 31,849,946 votes for, 41,066,233 votes against, 269,100 votes abstaining and 9,442,135 broker non-votes.

23

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Common Stock Market Prices and Dividends

The Company’s common shares trade on the New York Stock Exchange (ticker symbol FAF). The approximate number of record holders of common shares on February 22, 2010, was 3,275.

High and low stock prices and dividends declared for the last two years were as follows:

	2009				2008
Quarter Ended	High-low range		Cash dividends		High-low range		Cash dividends
March 31	$	28.56—$19.59	$	0.22	$	43.58—$28.10	$	0.22
June 30	$	29.96—$21.65	$	0.22	$	37.65—$26.40	$	0.22
September 30	$	33.57—$25.08	$	0.22	$	33.70—$21.08	$	0.22
December 31	$	33.88—$30.39	$	0.22	$	30.34—$15.11	$	0.22

On January 15, 2008, the Company announced its intention to separate its financial services companies from its information solutions companies. Following the consummation of the spin-off transaction, the financial services company is expected to pay approximately $24.0 million per year in dividends to holders of its common stock. However, the amount of the dividend, if any, depends on the earnings, financial condition and capital requirements of the financial services company at that time. The information solutions company is not expected to pay a dividend following the transaction.

While, prior to the spin-off transaction, the Company expects to continue its policy of paying regular quarterly cash dividends, future dividends will be dependent on future earnings, financial condition and capital requirements. The ability to pay dividends also is potentially affected by the restrictions described in Note 3 Statutory Restrictions on Investments and Stockholders’ Equity to the consolidated financial statements included in “Item 8. Financial Statements and Supplementary Data” of Part II of this report.

Unregistered Sales of Equity Securities

During the year ended December 31, 2009, the Company did not issue any unregistered common shares.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

The following table describes purchases by the Company of the Company’s Common shares which settled during each period set forth in the table. Prices in column (b) include commissions. Purchases described in column (c) were made pursuant to the share repurchase program initially announced by the Company on May 18, 2004, which was amended to add additional amounts to the repurchase authorization on May 19, 2005, June 26, 2006, and January 15, 2008. The amounts in column (d) reflect the effect of these amendments. Under this plan, which has no expiration date, the Company may repurchase up to $800 million of the Company’s issued and outstanding Common shares. In 2009, the Company did not repurchase any shares under this plan and cumulatively the Company has repurchased $439.6 million (including commissions) of its shares and had the authority to repurchase an additional $360.4 million (including commissions) under the plan.

Period	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share	(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
October 1 to October 31, 2009	—	—	—	$	360,369,939
November 1 to November 30, 2009	—	—	—	$	360,369,939
December 1 to December 31, 2009	—	—	—	$	360,369,939
Total	—	—	—	$	360,369,939

24

Stock Performance Graph

The following performance graph and related information shall not be deemed “soliciting material” or “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, each as amended, except to the extent that it is specifically incorporated by reference into such filing.

The following graph compares the yearly percentage change in the cumulative total shareholder return on the Company’s common shares with the corresponding changes in the cumulative total returns of the Standard & Poor’s 500 Index, the Standard & Poor’s 500 Financials Index and a peer group index. The comparison assumes an investment of $100 on December 31, 2004 and reinvestment of dividends. This historical performance is not indicative of future performance.

Comparison of Five-Year Cumulative Total Return

	The First American Corp (FAF) (1)		Custom Peer Group (1)(2)		S&P 500 Financial Sector Index (1)		S&P 500 Index (1)
12/31/2004	$	100	$	100	$	100	$	100
12/31/2005	$	131	$	108	$	107	$	105
12/31/2006	$	120	$	115	$	127	$	121
12/31/2007	$	103	$	87	$	103	$	128
12/31/2008	$	90	$	69	$	46	$	81
12/31/2009	$	106	$	82	$	54	$	102

25

(1) As calculated by Bloomberg Financial Services, to include reinvestment of dividends.

(2) The peer group consists of the following companies: Assurant, Inc.; Affiliated Computer Services, Inc.; Fidelity National Financial, Inc. (as it existed on December 31, 2004 and its successor entities); Fiserv, Inc.; Old Republic International Corp.; LandAmerica Financial Group, Inc. (through December 8, 2009); Equifax Inc.; Stewart Information Services Corp.; MGIC Investment Corporation; The Dun & Bradstreet Corporation; The PMI Group, Inc.; ChoicePoint Inc. (through September 19, 2008); Fair Isaac Corporation; Fidelity National Information Services, Inc.; and Radian Group Inc., each of which operates in a business similar to a business operated by the Company. The Compensation Committee of the Company utilizes the compensation practices of these companies as benchmarks in setting the compensation of its executive officers.

26

Item 6.    Selected Financial Data

The selected consolidated financial data for The First American Corporation (“the Company”) for the five-year period ended December 31, 2009, has been derived from the Consolidated Financial Statements. The selected consolidated financial data should be read in conjunction with the Consolidated Financial Statements and Notes thereto, “Item 1—Business—Acquisitions,” and “Item 7—Management’s Discussion and Analysis—Results of Operations.” The selected Consolidated Statements of Income data for the years ended December 31, 2006 and 2005 and the Consolidated Balance Sheet data as of December 31, 2007, 2006 and 2005 have been derived from audited financial statements not included herein and, where applicable, such data was recast for the retrospective application of new accounting guidance for noncontrolling interests in a consolidated subsidiary, which the Company became subject to beginning January 1, 2009.

The First American Corporation and Subsidiary Companies

	Year Ended December 31
	2009			2008			2007			2006			2005
	(in thousands, except percentages, per share amounts and employee data)
Revenues	$	5,972,777		$	6,213,758		$	8,222,383		$	8,533,597		$	8,104,751
Net income	$	269,176		$	28,365		$	108,374		$	376,803		$	574,242
Net income attributable to noncontrolling interests	$	69,525		$	54,685		$	111,493		$	89,127		$	93,862
Net income (loss) attributable to the Company	$	199,651		$	(26,320	)	$	(3,119	)	$	287,676		$	480,380
Total assets	$	8,723,097		$	8,808,070		$	8,647,921		$	8,224,285		$	7,598,641
Notes and contracts payable	$	791,083		$	868,274		$	906,046		$	847,991		$	848,569
Deferrable interest subordinated notes	$	100,000		$	100,000		$	100,000		$	100,000		$	100,000
Stockholders’ equity (Note A)	$	3,154,295		$	2,697,650		$	2,975,398		$	3,202,281		$	3,005,519
Return on average stockholders’ equity		6.8	%		(0.9	)%		(0.1	)%		9.3	%		17.6	%
Dividends on common shares	$	84,349		$	81,542		$	82,833		$	69,213		$	68,636
Per share of common stock (Note B)—Net income (loss) attributable to the Company:
Basic	$	2.11		$	(0.28	)	$	(0.03	)	$	2.99		$	5.09
Diluted	$	2.09		$	(0.28	)	$	(0.03	)	$	2.92		$	4.92
Stockholders’ equity (Note A)	$	30.54		$	29.02		$	32.40		$	33.19		$	31.35
Cash dividends	$	0.88		$	0.88		$	0.88		$	0.72		$	0.72
Number of common shares outstanding— Weighted average during the year:
Basic		94,551			92,516			94,649			96,206			94,351
Diluted		95,478			92,516			94,649			98,653			97,691
End of year		103,283			92,963			91,830			96,484			95,860
Other Operating Data (unaudited):
Title orders opened (Note C)		1,991			1,961			2,402			2,510			2,700
Title orders closed (Note C)		1,503			1,399			1,697			1,866			2,017
Number of employees (Note D)		30,922			31,411			37,354			39,670			37,883

Note A—Stockholders’ equity refers to the stockholders of the Company and excludes noncontrolling interests.

Note B—Per share information relating to net income is based on weighted-average number of shares outstanding for the years presented. Per share information relating to stockholders’ equity is based on shares outstanding at the end of each year.

Note C—Title order volumes are those processed by the direct title operations of the Company and do not include orders processed by agents.

Note D—Number of employees is based on actual employee headcount, including employees of unconsolidated subsidiaries.

27

Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis contains certain financial measures, in particular presentation of certain balances excluding the impact of acquisitions and other non-recurring items that are not presented in accordance with generally accepted accounting principles (“GAAP”). The Company is presenting these non-GAAP financial measures because they provide the Company’s management and readers of the Annual Report on Form 10-K with additional insight into the operational performance of the Company relative to earlier periods and relative to the Company’s competitors. The Company does not intend for these non-GAAP financial measures to be a substitute for any GAAP financial information. Readers of this Annual Report on Form 10-K should use these non-GAAP financial measures only in conjunction with the comparable GAAP financial measures.

Spin-off

On January 15, 2008, the Company announced that its Board of Directors had approved a plan to separate the Company into two independent publicly traded companies (the “separation”), one consisting of the Company’s financial services businesses, FinCo, and one for its information solutions businesses, InfoCo. The Company expects to accomplish this by way of a dividend distribution of the common stock of FinCo, the Company’s wholly-owned subsidiary, to the Company’s shareholders (the “Distribution”). Immediately following the Distribution, the Company’s shareholders will own 100% of the outstanding common stock of FinCo. Prior to the Distribution, certain internal transactions will occur so that FinCo directly or indirectly owns all of the Company’s financial services businesses and the title plant management business. The remaining entity, InfoCo, will own all of the Company’s remaining information solutions businesses. FinCo will adopt the “FAF” ticker symbol and its shares of common stock will be traded on the New York Stock Exchange under that symbol. InfoCo will change its name and ticker symbol following the separation.

The Company continues to proceed with preparations for the separation, and currently expects the separation to occur during the first half of 2010, with a target date of June 1, 2010. The Company’s subsidiary, First American Financial Corporation, filed a Form 10 Registration Statement with the Securities and Exchange Commission on December 14, 2009, and Amendment No. 1 thereto on February 12, 2010, in preparation for the separation. The transaction remains subject to customary conditions, including final approval by the Board of Directors, effectiveness of the Form 10 Registration Statement, receipt of a tax ruling from the Internal Revenue Service and the approval of applicable regulatory authorities, some of which have already been received.

Effective January 1, 2008, the Company reorganized its two business groups and underlying segments to reflect how the assets and operations at that time were expected to be divided when the spin-off is consummated, which generally reflects how the business is currently managed. The segment presentation below reflects this reorganization. All previously reported segment information has been restated to conform to this presentation.

Financial Services Group

• Title Insurance and Services: The title insurance and services segment issues title insurance policies on residential and commercial property in the United States and offers similar products and services internationally. This segment also provides escrow and closing services, accommodates tax-deferred exchanges of real estate and provides investment advisory, trust, lending and deposit services. Beginning on January 1, 2010, this segment is also in the business of maintaining, managing and providing access to automated title plant records and images that may be owned by the Company or other parties, which was previously carried on by the data and analytic solutions segment. The Company, through its principal title insurance subsidiary and such subsidiary’s affiliates, transacts its title insurance business through a network of direct operations and agents. Through this network, the Company issues policies in the 49 states that permit the issuance of title insurance policies and the District of Columbia. In Iowa, the Company provides title abstracts only because title insurance is not permitted by law. The Company also offers title insurance and similar products, as well as related

28

services, either directly or through joint ventures in foreign countries, including Canada, the United Kingdom and various other established and emerging markets. The international operations account for an immaterial amount of the Company’s income before income taxes.

• Specialty Insurance: The specialty insurance segment issues property and casualty insurance policies and sells home warranty products. The property and casualty insurance business provides insurance coverage to residential homeowners and renters for liability losses and typical hazards such as fire, theft, vandalism and other types of property damage. This business is licensed to issue policies in all 50 states and actively issues policies in 43 states. In its largest market, California, it also offers preferred risk auto insurance to better compete with other carriers offering bundled home and auto insurance. The home warranty business provides residential service contracts that cover residential systems and appliances against failures that occur as the result of normal usage during the coverage period. This business currently operates in 34 states and the District of Columbia.

Information Solutions Group

• Information and Outsourcing Solutions: The information and outsourcing solutions segment provides a wide-range of products and services, including tax monitoring, flood zone certification and monitoring, building and maintaining geospatial proprietary software and databases, default management services, loan administration and production services, business process outsourcing and asset valuation and management services. These products are generally provided nationwide.

• Data and Analytic Solutions: The data and analytic solutions segment provides licenses and analyzes data relating to mortgage securities and loans and real property, offers risk management and collateral assessment analytics, provides database access tools to various businesses, in particular to businesses operating in the real estate industry, and provides automated valuation models which use data and sophisticated mathematical models and analytic tools to arrive at a property valuation.

• Risk Mitigation and Business Solutions: The risk mitigation and business solutions segment is comprised entirely of the Company’s wholly-owned subsidiary, First Advantage Corporation (“First Advantage”). First Advantage provides credit services, data services, employer services, multifamily services, and investigative and litigation support services. The credit services business offers lenders credit reporting solutions for mortgage and home equity needs, provides consumer credit reporting services and serves the automotive dealer marketplace by delivering consolidated consumer credit reports and automotive lead generation services. The data services business provides transportation credit reporting, motor vehicle record reporting, fleet management, criminal records reselling, specialty finance credit reporting and lead generation services. The employer services business includes employment background screening, occupational health services, tax incentive services and hiring solutions. The multifamily services business provides resident screening and software services. The investigative and litigation support services business provides all investigative services.

Critical Accounting Policies and Estimates

The Company’s management considers the accounting policies described below to be critical in preparing the Company’s consolidated financial statements. These policies require management to make estimates and judgments that affect the reported amounts of certain assets, liabilities, revenues, expenses and related disclosures of contingencies. See Note 1 Description of the Company to the consolidated financial statements for a more detailed description of the Company’s accounting policies.

Revenue recognition.    Title premiums on policies issued directly by the Company are recognized on the effective date of the title policy and escrow fees are recorded upon close of the escrow. Revenues from title

29

policies issued by independent agents are recorded when notice of issuance is received from the agent, which is generally when cash payment is received by the Company. Revenues from home warranty contracts are recognized ratably over the 12-month duration of the contracts. Revenues from property and casualty insurance policies are also recognized ratably over the 12-month duration of the policies. Interest on loans of the Company’s thrift subsidiary is recognized on the outstanding principal balance on the accrual basis. Loan origination fees and related direct loan origination costs are deferred and recognized over the life of the loan. Revenues earned by the other products in the trust and banking operations of the Company are recognized at the time of delivery, as the Company has no significant ongoing obligation after delivery. The Company’s tax service division defers the tax service fee on life of loan contracts and recognizes that fee as revenue ratably over the expected service period. The amortization rates applied to recognize the revenues assume a 10-year contract life and are adjusted to reflect prepayments. The Company reviews its tax service contract portfolio quarterly to determine if there have been changes in contract lives and/or changes in the number and/or timing of prepayments. Accordingly, the Company may adjust the rates to reflect current trends. Subscription-based revenues are recognized ratably over the contractual term of the subscription. Revenues earned by most other products in the information solutions group are recognized at the time of delivery, as the Company has no significant ongoing obligation after delivery.

Provision for title losses.    The Company provides for title insurance losses by a charge to expense when the related premium revenue is recognized. The amount charged to expense is generally determined by applying a rate (the loss provision rate) to total title insurance operating revenues. The Company’s management estimates the loss provision rate at the beginning of each year and reassesses the rate quarterly to ensure that the resulting incurred but not reported (“IBNR”) loss reserve and known claims reserve included in the Company’s consolidated balance sheets together reflect management’s best estimate of the total costs required to settle all IBNR and known claims. If the ending IBNR reserve is not considered adequate, an adjustment is recorded.

The process of assessing the loss provision rate and the resulting IBNR reserve involves evaluation of the results of both an in-house actuarial review and independent actuarial analysis. The Company’s in-house actuary performs a reserve analysis utilizing generally accepted actuarial methods that incorporate cumulative historical claims experience and information provided by in-house claims and operations personnel. Current economic and business trends are also reviewed and used in the reserve analysis. These include real estate and mortgage markets conditions, changes in residential and commercial real estate values, and changes in the levels of defaults and foreclosures that may affect claims levels and patterns of emergence, as well as any company-specific factors that may be relevant to past and future claims experience. Results from the analysis include, but are not limited to, a range of IBNR reserve estimates and a single point estimate for IBNR as of the balance sheet date.

For recent policy years at early stages of development (generally the last three years), IBNR was determined by applying an expected loss rate to operating revenue and adjusting for policy year maturity using the estimated loss development pattern. The expected loss rate is based on historical experience and the relationship of the history to the applicable policy years. This is a generally accepted actuarial method of determining IBNR for policy years at early development ages, and when claims data reflects unusual impacts. IBNR calculated in this way differs from the IBNR a multiplicative loss development factor calculation would produce. Factor-based development effectively extrapolates results to date forward through the lifetime of the policy year’s development. Management believes the expected loss rate method is appropriate for recent policy years, because of the high level of loss emergence during the past three calendar years. This loss emergence is believed to consist largely of acceleration of claims that otherwise would have been realized later and one-time losses. Both of these effects are results of temporary economic conditions that are not expected to persist throughout the development lifetime of those policy years.

For more mature policy years (generally, policy years aged more than three years), IBNR was determined using multiplicative loss development factor calculations. These years were also exposed to adverse economic conditions during 2007-2009 that may have resulted in acceleration of claims and one-time losses. The possible extrapolation of these losses to future development periods by using factors was considered. The impact of

30

economic conditions during 2007-2009 is believed to account for a much less significant portion of losses on policy years 2004 and prior than on more recent policy years. Policy years 2004 and prior were at relatively mature ages when the adverse development period began in 2007, and much of their losses had already been incurred by then. In addition, the loss development factors for policy years 2006 and prior are low enough that the potential for over-extrapolation is limited to an acceptable level.

The Company utilizes an independent third party actuary who produces a report with estimates and projections of the same financial items described above. The third party actuary’s analysis uses generally accepted actuarial methods that may in whole or in part be different from those used by the in-house actuary. The third party actuary’s report is a second estimate that is used to validate the reasonableness of the in-house analysis.

The Company’s management uses the point estimate of the projected IBNR from the in-house actuary’s analysis and other relevant information it may have concerning claims to determine what it considers to be the best estimate of the total amount required for the IBNR reserve.

Title insurance policies are long-duration contracts with the majority of the claims reported to the Company within the first few years following the issuance of the policy. Generally, 70 to 80 percent of claim amounts become known in the first five years of the policy life, and the majority of IBNR reserves relate to the five most recent policy years. A material change in expected ultimate losses and corresponding loss rates for policy years older than five years, while possible, is not considered reasonably likely by the Company. However, changes in expected ultimate losses and corresponding loss rates for recent policy years are considered likely and could result in a material adjustment to the IBNR reserves. Based on historical experience, the Company believes that a 50 basis point change to one or more of the loss rates for the most recent policy years, positive or negative, is reasonably likely given the long duration nature of a title insurance policy. If the expected ultimate losses for each of the last five policy years increased or decreased by 50 basis points, the resulting impact on the IBNR reserve would be an increase or decrease, as the case may be, of $123.3 million. The estimates made by management in determining the appropriate level of IBNR reserves could ultimately prove to be inaccurate and actual claims experience may vary from the expected claims experience.

A summary of the Company’s loss reserves, broken down into its components of known title claims, incurred but not reported and non-title claims, follows:

(in thousands except percentages)	December 31, 2009				December 31, 2008
Known title claims	$	206,439	16.4	%	$	234,311	17.3	%
IBNR		978,854	78.0	%		1,035,779	76.4	%
Total title claims		1,185,293	94.4	%		1,270,090	93.7	%
Non-title claims		69,795	5.6	%		85,302	6.3	%
Total loss reserves	$	1,255,088	100.0	%	$	1,355,392	100.0	%

Fair Value of Investment Portfolio.    The Company classifies its publicly traded debt and equity securities as available-for-sale and carries them at fair value with unrealized gains or losses classified as a component of accumulated other comprehensive loss.

The Company determines the fair value of its debt and equity securities using a three-level hierarchy for fair value measurements that distinguishes between market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs) and the reporting entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The hierarchy level assigned to each security in the Company’s

31

available-for-sale portfolio is based on management’s assessment of the transparency and reliability of the inputs used in the valuation of such instrument at the measurement date. The three hierarchy levels are defined as follows:

Level 1—Valuations based on unadjusted quoted market prices in active markets for identical securities. The fair value of equity securities included in the Level 1 category was based on quoted prices that are readily and regularly available in an active market.

Level 2—Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. The fair value of fixed maturity and short-term investments included in the Level 2 category was based on the market values obtained from an independent pricing service that were evaluated using pricing models that vary by asset class and incorporate available trade, bid and other market information and price quotes from well-established independent broker-dealers. This pricing service, which is a provider of financial market data, analytics and related services to financial institutions, provides the Company one price for each security. The independent pricing service monitors market indicators, industry and economic events, and for broker-quoted only securities, obtains quotes from market makers or broker-dealers that it recognizes to be market participants. The Level 2 category includes foreign bonds, governmental agency bonds, governmental agency mortgage-backed and asset-backed securities and corporate debt securities, many of which are actively traded and have market prices that are readily verifiable. Level 2 also includes non-agency mortgage-backed and asset-backed securities and municipal bonds which are currently not actively traded securities. When the value from an independent pricing service is utilized, the Company obtains an understanding of the valuation models and assumptions utilized by the service and has controls in place to determine that the values provided represent current values. Typical inputs and assumptions to pricing models used to value securities include, but are not limited to, benchmark yields, reported trades, broker-dealer quotes, issue spreads, benchmark securities, bids, offers, reference data and industry and economic events. For mortgage-backed and asset-backed securities, inputs and assumptions may also include the structure of issuance, characteristics of the issuer, collateral attributes, prepayment speeds and credit ratings. The Company’s non-agency mortgage-backed and asset-backed securities consist of senior tranches of securitizations and the underlying borrowers are substantially all prime. The Company’s validation procedures include assessing the reasonableness of the changes relative to prior periods given the prevailing market conditions, comparison of the prices received from the pricing service to quotes received from other third party sources for securities with market prices that are readily verifiable, changes in the issuers’ credit worthiness, performance of any underlying collateral and prices of the instrument relative to similar issuances. To date, the Company has not made any adjustments to the results provided by the pricing service.

Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement, and involve management judgment.

If the inputs used to measure fair value fall in different levels of the fair value hierarchy, a financial security’s hierarchy level is based upon the lowest level of input that is significant to the fair value measurement. A number of the Company’s investment grade corporate bonds are frequently traded in active markets and market prices for these securities existed at December 31, 2009. These securities were classified as Level 2 at December 31, 2009 because the valuation models use observable market inputs in addition to traded prices.

In the first quarter of 2009, the Company adopted newly issued accounting guidance that establishes a new method of recognizing and reporting other-than-temporary impairment of debt securities. The Company assesses the unrealized losses in its debt security portfolio under this guidance, primarily the non-agency mortgage-backed and asset-backed securities. If the Company determines it does not expect to recover the amortized cost basis of a debt security with declines in fair value (even if it does not intend to sell or it is not more likely than not that it will be required to sell the debt security before the recovery of the debt security’s remaining amortized cost basis), the credit portion of the other-than-temporary impairment loss is recognized in earnings and the non-credit portion, if any, is recognized in other comprehensive income. The credit portion of the other-than-

32

temporary impairment loss is the difference between the present value of the cash flows expected to be collected and the amortized cost basis of the debt security. Expected future cash flows are based on qualitative and quantitative factors, including the probability of default and the estimated timing and amount of recovery. For non-agency mortgage-backed and asset-backed securities, estimated future cash flows are based on the structure of the security and certain assumptions, such as the remaining payment terms of the security, prepayment speeds, default rates and loss severity on the collateral supporting the security. In developing the assumptions used in estimating the expected future cash flows, the Company utilized publicly available information related to individual assets, generally available market data such as forward interest rate curves and its securities data and market analytic tools. The expected future cash flows are discounted using the current accrual rate attributable to the security.

When, in the opinion of management, a decline in the fair value of an equity security (including common and preferred stock) and, prior to the first quarter of 2009, a debt security is considered to be other-than-temporary, such security is written down to its fair value. When assessing if a decline in value is other-than-temporary, the factors considered include the length of time and extent to which fair value has been below cost, the probability that the Company will be unable to collect all amounts due under the contractual terms of the security, the seniority and duration of the securities, issuer-specific news and other developments, the financial condition and prospects of the issuer (including credit ratings), macro-economic changes (including the outlook for industry sectors, which includes government policy initiatives) and the Company’s ability and intent to hold the investment for a period of time sufficient to allow for any anticipated recovery.

When an equity security has been in an unrealized loss position for greater than twelve months, the Company’s review of the security includes the above noted factors as well as what evidence, if any, exists to support that the security will recover its value in the foreseeable future, typically within the next twelve months. If objective, substantial evidence does not indicate a likely recovery during that timeframe, the Company’s policy is that such losses are considered other-than-temporary and therefore an impairment loss is recorded.

Purchase accounting and impairment testing for goodwill and other intangible assets.    The Company is required to perform an annual impairment test for goodwill and other indefinite-lived intangible assets for each reporting unit. This annual test, which the Company has elected to perform every fourth quarter, utilizes a variety of valuation techniques, all of which require it to make estimates and judgments. Fair value is determined by employing an expected present value technique, which utilizes multiple cash flow scenarios that reflect a range of possible outcomes and an appropriate discount rate. The use of comparative market multiples (the “market approach”) compares the reporting unit to other comparable companies (if such comparables are present in the marketplace) based on valuation multiples to arrive at a fair value. The Company also uses certain of these valuation techniques in accounting for business combinations, primarily in the determination of the fair value of acquired assets and liabilities. In assessing the fair value, the Company utilizes the results of the valuations (including the market approach to the extent comparables are available) and considers the range of fair values determined under all methods and the extent to which the fair value exceeds the book value of the equity. The Company’s reporting units are title insurance, home warranty, property and casualty insurance, trust and other services, data and analytic solutions, information and outsourcing solutions, lender services, data services, dealer services, employer services, multifamily services and investigative and litigation support services. The Company’s policy is to perform an annual impairment test for each reporting unit in the fourth quarter or sooner if circumstances indicate a possible impairment.

Management’s impairment testing process includes two steps. The first step (“Step 1”) compares the fair value of each reporting unit to its book value. The fair value of each reporting unit is determined by using discounted cash flow analysis and market approach valuations. If the fair value of the reporting unit exceeds its book value, the goodwill is not considered impaired and no additional analysis is required. However, if the book value is greater than the fair value, a second step (“Step 2”) must be completed to determine if the fair value of the goodwill exceeds the book value of the goodwill.

33

Step 2 involves calculating an implied fair value of goodwill for each reporting unit for which the first step indicated impairment. The implied fair value of goodwill is determined in a manner similar to the amount of goodwill calculated in a business combination, by measuring the excess of the estimated fair value of the reporting unit, as determined in the first step, over the aggregate estimated fair values of the individual assets, liabilities and identifiable intangibles as if the reporting unit was being acquired in a business combination. If the implied fair value of goodwill exceeds the carrying value of goodwill assigned to the reporting unit, there is no impairment. If the carrying value of goodwill assigned to a reporting unit exceeds the implied fair value of the goodwill, an impairment loss is recorded for the excess. An impairment loss cannot exceed the carrying value of goodwill assigned to a reporting unit, and the loss establishes a new basis in the goodwill. Subsequent reversal of goodwill impairment losses is not permitted. The valuation of goodwill requires assumptions and estimates of many critical factors including revenue growth, cash flows, market multiples and discount rates. Forecasts of future operations are based, in part, on operating results and the Company’s expectations as to future market conditions. These types of analyses contain uncertainties because they require the Company to make assumptions and to apply judgments to estimate industry economic factors and the profitability of future business strategies. However, if actual results are not consistent with the Company’s estimates and assumptions, it may be exposed to an additional impairment loss that could be material. Due to significant volatility in the current markets, the Company’s operations may be negatively impacted in the future to the extent that exposure to impairment charges may be required. The Company completed the required annual impairment testing for goodwill and other intangible assets for the years ended December 31, 2009 and 2008, in the fourth quarter of each year. In 2009 and 2008, management concluded that, based on its assessment of the reporting units’ operations, the markets in which the reporting units operate and the long-term prospects for those reporting units that the more likely than not threshold for decline in value had not been met and that therefore no triggering events requiring an earlier analysis had occurred.

As of the date of the Company’s 2009 annual impairment review, the title insurance reporting unit included $699.5 million of goodwill. The fair value of this reporting unit under the income and market value approaches exceeded the carrying value of the reporting unit’s book value by approximately 4.5% and 20.0%, respectively. The property and casualty insurance reporting unit included $33.2 million of goodwill as of the Company’s 2009 annual impairment review. The fair value of this reporting unit under the income and market value approaches exceeded the carrying value of the reporting unit’s book value by approximately 36.0% and 6.4%, respectively. Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions, including revenue growth rates and operating margins, discount rates and future market conditions, among others. It is reasonably possible that changes in the judgments, assumptions and estimates the Company made in assessing the fair value of its goodwill could cause these or other reporting units to become impaired. There were no other reporting units that management deemed to have a reasonable risk of material impairment charge at this time.

Management uses estimated future cash flows (undiscounted and excluding interest) to measure the recoverability of long-lived assets held and used whenever events or changes in circumstances indicate that the carrying value of an asset may not be fully recoverable. At such time that an impairment in value of an intangible or long-lived asset is identified, the impairment is measured as the amount by which the carrying amount of the long-lived asset exceeds its fair value.

Income taxes.    The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company evaluates the need to establish a valuation allowance for deferred tax assets based upon the amount of existing temporary differences, the period in which they are expected to be recovered and expected levels of taxable income. A valuation allowance to reduce deferred tax assets is established when it is “more likely than not” that some or all of the deferred tax assets will not be realized.

34

The Company recognizes the effect of income tax positions only if sustaining those positions is “more likely than not.” Changes in recognition or measurement of uncertain tax positions are reflected in the period in which a change in judgment occurs. The Company recognizes interest and penalties, if any, related to uncertain tax positions in tax expense. As a result of adopting the accounting guidance for uncertain income tax positions, the Company recorded a cumulative effect adjustment of $8.1 million as a reduction to retained earnings as of January 1, 2007.

Depreciation and amortization lives for assets.    Management is required to estimate the useful lives of several asset classes, including capitalized data, internally developed software and other intangible assets. The estimation of useful lives requires a significant amount of judgment related to matters such as future changes in technology, legal issues related to allowable uses of data and other matters.

Share-based compensation.    The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). The cost is recognized over the period during which an employee is required to provide services in exchange for the award. In accordance with the modified prospective method, the Company continues to use the Black-Scholes option-pricing model for all unvested options as of December 31, 2005. The Company has selected the binomial lattice option-pricing model to estimate the fair value for any options granted after December 31, 2005. The Company utilizes the straight-line single option method of attributing the value of share-based compensation expense unless another expense attribution model is required by the guidance. As stock-based compensation expense recognized in the results of operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company applies the long-form method for determining the pool of windfall tax benefits.

The Company’s primary means of share-based compensation is granting restricted stock units (“RSUs”). The fair value of any RSU grant is based on the market value of the Company’s shares on the date of grant and is generally recognized as compensation expense over the vesting period. RSUs granted to certain key employees have graded vesting and have a service and performance requirement and are therefore expensed using the accelerated multiple-option method to record share-based compensation expense. All other RSU awards have graded vesting and service is the only requirement to vest in the award and are therefore generally expensed using the straight-line single option method to record share-based compensation expense. RSUs receive dividend equivalents in the form of RSUs having the same vesting requirements as the RSUs initially granted.

In addition to stock options and RSUs, the Company has an employee stock purchase plan that allows eligible employees to purchase common stock of the Company at 85.0% of the closing price on the last day of each month. The Company recognizes an expense in the amount equal to the discount.

Recent Accounting Pronouncements:

In June 2009, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance surrounding the Hierarchy of Generally Accepted Accounting Principles. This guidance established the FASB Accounting Standards Codification (“the Codification” or “ASC”) as the official single source of authoritative U.S. generally accepted accounting principles (“GAAP”). All guidance contained in the Codification carries an equal level of authority. All existing accounting standards are superseded. All other accounting guidance not included in the Codification will be considered non-authoritative. The Codification also includes all relevant SEC guidance organized using the same topical structure in separate sections within the Codification. Following the Codification, the FASB will not issue new standards in the form of Statements, FASB Staff Positions or Emerging Issues Task Force Abstracts. Instead, it will issue Accounting Standards Updates which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification. The Codification is not intended to change GAAP, but it will change the way GAAP is organized and presented. The Codification is effective for financial statements issued

35

for interim and annual periods ending after September 15, 2009. Except for the disclosure requirements, the adoption of this statement did not have an impact on the determination or reporting of the Company’s consolidated financial statements.

In September 2006, the FASB issued guidance related to defining fair value, establishing a framework for measuring fair value within GAAP, and expanding disclosure requirements regarding fair value measurements. Although this guidance does not require any new fair value measurements, its application may, in certain instances, change current practice. Where applicable, this guidance simplifies and codifies fair value related guidance previously issued within GAAP. In February 2008, the FASB issued authoritative guidance which delayed the effective date for application of the fair value framework to non-financial assets and non-financial liabilities until January 1, 2009. The provisions of this guidance related to financial assets and liabilities were applied as of January 1, 2008, and had no material effect on the Company’s consolidated financial statements. The fair value framework relating to non-financial assets and non-financial liabilities was applied as of January 1, 2009, and had no material effect on the Company’s consolidated financial statements. In October 2008, the FASB issued supplemental guidance relating to determining the fair value of a financial asset when the market for that asset is not active. This guidance clarifies the application of the fair value framework in cases where a market is not active. The Company considered the supplemental guidance in its determination of estimated fair values as of December 31, 2009 and 2008, and the impact was not material.

In February 2007, the FASB issued authoritative guidance permitting companies to elect to measure many financial assets and liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. The Company adopted this guidance effective January 1, 2008, but did not apply it to any assets or liabilities and, therefore, the adoption had no effect on its consolidated financial statements.

In April 2009, the FASB issued authoritative guidance surrounding the determination of fair value when the volume and level of activity for an asset or liability have significantly decreased and identifying transactions that are not orderly. The guidance indicates that if an entity determines that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value. The guidance is effective for interim and annual periods ending after June 15, 2009, with early adoption permitted. Further, this guidance must be applied prospectively. The Company elected to adopt the guidance in the first quarter of 2009. The adoption of the guidance did not have a material impact on the Company’s consolidated financial statements.

In April 2009, the FASB issued guidance relating to fair value disclosures in public entity financial statements for financial instruments. This guidance increases the frequency of those disclosures, requiring public entities to provide the disclosures on a quarterly basis, rather than annually. The guidance is effective for interim and annual periods ending after June 15, 2009. The Company adopted this guidance in the second quarter of 2009. Except for the disclosure requirements, the adoption of this guidance did not have an impact on the Company’s consolidated financial statements.

In April 2009, the FASB issued guidelines which establish a new method of recognizing and reporting other-than-temporary impairments of debt securities. It also contains additional disclosure requirements related to debt and equity securities and changes existing impairment guidance. For debt securities, the “ability and intent to hold” provision is eliminated, and impairment is considered to be other-than-temporary if an entity (i) intends to sell the security, (ii) more likely than not will be required to sell the security before recovering its cost, or (iii) does not expect to recover the security’s entire amortized cost basis (even if the entity does not intend to sell). This new framework does not apply to equity securities (i.e., impaired equity securities will continue to be evaluated under previously existing guidance). The “probability” standard relating to the collectability of cash flows is eliminated, and impairment is now considered to be other-than-temporary if the present value of cash flows expected to be collected from the debt security is less than the amortized cost basis of the security. The

36

guidance also provides that for debt securities which (i) an entity does not intend to sell and (ii) it is not more likely than not that the entity will be required to sell before the anticipated recovery of its remaining amortized cost basis, the impairment is separated into the amount related to estimated credit losses and the amount related to all other factors. The amount of the total impairment related to all other factors is recorded in accumulated other comprehensive loss and the amount related to estimated credit loss is recognized as a charge against current period earnings. This guidance is effective for interim and annual periods ending after June 15, 2009, with early adoption permitted. The Company elected to adopt this guidance in the first quarter of 2009. See the discussion in Note 4 Debt and Equity Securities regarding to the consolidated financial statements for the impact of adoption.

In April 2009, the SEC issued authoritative guidance surrounding other-than-temporary impairment which amended existing SEC guidance relating to other-than-temporary impairment for certain investments in debt and equity securities. The guidance maintains the SEC staff’s previous views related to equity securities, but now excludes debt securities from its scope. The Company elected to adopt this guidance in the first quarter of 2009. There was no material impact on the Company’s consolidated financial statements as a result of adopting this guidance.

In December 2007, the FASB revised authoritative guidance surrounding business combinations. The guidance retains the fundamental requirements contained in the original pronouncement. For example, the acquisition method of accounting, previously known as the purchase method, is required to be used for all business combinations and for an acquirer to be identified for each business combination. This revised guidance establishes principles and requirements for how the acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. Further, this guidance requires contingent consideration to be recognized at its fair value on the acquisition date and, for certain arrangements, changes in fair value to be recognized in earnings until settled. This guidance also requires acquisition-related transaction and restructuring costs to be expensed rather than treated as part of the cost of the acquisition. The Company adopted this guidance on January 1, 2009 and the adoption did not have a material impact on its financial statements.

In April 2009, the FASB issued supplemental guidance surrounding accounting for assets acquired and liabilities assumed in a business combination that arise from contingencies. The FASB voted to carry forward the requirements under existing guidelines surrounding business combinations for acquired contingencies, which required contingencies to be recognized at fair value on the acquisition date if the fair value could be reasonably estimated during the allocation period. Otherwise, companies would typically account for the acquired contingencies in accordance with authoritative literature surrounding accounting for contingencies. As a result of the requirement to carry forward the accounting treatment for acquired contingencies, accounting for pre-acquisition contingencies may be an exception to the recognition and fair value measurement under authoritative guidance surrounding business combinations. Additionally, the FASB voted to change the accounting for an acquiree’s pre-existing contingent consideration arrangement that was assumed by the acquirer as part of the business combination. Such arrangements will now be accounted for as contingent consideration by the acquirer. The revised guidance is effective for all business combinations for which the acquisition date was on or after January 1, 2009. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

In December 2007, the FASB issued guidance surrounding noncontrolling interest in consolidated financial statements—an amendment to existing authoritative literature. The newly issued guidance requires recharacterizing minority interests as noncontrolling interests in addition to classifying noncontrolling interest as a component of equity. The guidance also establishes reporting requirements to provide disclosures that identify and distinguish between the interests of the parent and the interests of noncontrolling owners. This guidance requires retroactive adoption of the presentation and disclosure requirements for existing minority interests – all

37

other requirements are to be applied prospectively. All periods presented in these consolidated financial statements reflect the presentation and disclosure required by this guidance. All other requirements under the guidance are being applied prospectively. The Company adopted this guidance on January 1, 2009. Except for the presentation disclosure requirements required by this guidance, there was no impact on the Company’s financial statements.

In May 2009, the FASB issued authoritative guidance relating to the disclosure of subsequent events. This guidance is modeled after the same principles as the subsequent event guidance in auditing literature with some terminology changes and additional disclosures. This guidance is effective for interim and annual periods ending after June 15, 2009, and is required to be applied prospectively. The Company adopted the guidance in the second quarter of 2009. Except for the disclosure requirements, the adoption of the guidance had no impact on the Company’s consolidated financial statements.

In December 2008, the FASB issued guidance that expands the disclosures required in an employer’s financial statements about pension and other postretirement benefit plan assets. The new disclosures include more details about the categories of plan assets and information regarding fair value measurements. This guidance is effective for fiscal years ending after December 15, 2009. The Company adopted the guidance in the fourth quarter of 2009 and except for the disclosure requirements, the adoption had no impact on its consolidated financial statements.

Pending Accounting Pronouncements:

In January 2010, the FASB issued updated guidance related to fair value measurements and disclosures, which requires a reporting entity to disclose separately the amounts of significant transfers in and out of Level 1 and Level 2 fair value measurements and to describe the reasons for the transfers. In addition, in the reconciliation for fair value measurements using significant unobservable inputs, or Level 3, a reporting entity should disclose separately information about purchases, sales, issuances and settlements (that is, on a gross basis rather than one net number). The updated guidance also requires that an entity should provide fair value measurement disclosures for each class of assets and liabilities and disclosures about the valuation techniques and inputs used to measure fair value for both recurring and non-recurring fair value measurements for Level 2 and Level 3 fair value measurements. The updated guidance is effective for interim or annual financial reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances and settlements in the roll forward activity in Level 3 fair value measurements, which are effective for fiscal years beginning after December 15, 2010 and for interim periods within those fiscal years. Management does not expect the adoption of this standard will have a material impact on the Company’s consolidated financial statements.

In June 2009, the FASB issued guidelines relating to transfers of financial assets which amended existing guidance by removing the concept of a qualifying special purpose entity and establishing a new “participating interest” definition that must be met for transfers of portions of financial assets to be eligible for sale accounting, clarifies and amends the derecognition criteria for a transfer to be accounted for as a sale, and changes the amount that can be recognized as a gain or loss on a transfer accounted for as a sale when beneficial interests are received by the transferor. Enhanced disclosures are also required to provide information about transfers of financial assets and a transferor’s continuing involvement with transferred financial assets. This guidance must be applied as of the beginning of an entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Earlier application is prohibited. Management does not expect the adoption of this standard will have a material impact on the Company’s consolidated financial statements.

In June 2009, the FASB issued guidance amending existing guidance surrounding the consolidation of variable interest entities to require an enterprise to qualitatively assess the determination of the primary beneficiary of a variable interest entity (“VIE”) based on whether the entity (1) has the power to direct the

38

activities of a VIE that most significantly impact the entity’s economic performance and (2) has the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. This guidance also requires an ongoing reconsideration of the primary beneficiary, and amends the events that trigger a reassessment of whether an entity is a VIE. Enhanced disclosures are also required to provide information about an enterprise’s involvement in a VIE. This statement is effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Earlier application is prohibited. Management is currently evaluating the effect that adoption of this standard will have on the Company’s consolidated financial position and results of operations when it becomes effective in 2010.

Results of Operations

Overview

A substantial portion of the revenues for the Company’s title insurance and services segment result from resales and refinancings of residential real estate and, to a lesser extent, from commercial transactions and the construction and sale of new housing. Over one-half of the revenues in the Company’s information and outsourcing solutions and data and analytic solutions segments and approximately 19% of the revenues from the Company’s risk mitigation and business solutions segment also depend on real estate activity. The remaining portion of the information and outsourcing solutions, data and analytic solutions and risk mitigation and business solutions segments’ revenues are less impacted by, or are isolated from, the volatility of real estate transactions. In the specialty insurance segment, revenues associated with the initial year of coverage in both the home warranty and property and casualty operations are impacted by volatility in real estate transactions. Traditionally, the greatest volume of real estate activity, particularly residential resale, has occurred in the spring and summer months. However, changes in interest rates, as well as other economic factors, can cause fluctuations in the traditional pattern of real estate activity.

Residential mortgage originations in the United States (based on the total dollar value of the transactions) increased 40.0% in 2009 when compared with 2008, according to the Mortgage Bankers Association’s January 12, 2010 Mortgage Finance Forecast (the “MBA Forecast”). This increase was primarily due to increased refinance activity. According to the MBA Forecast, the dollar amount of refinance originations and purchase originations increased 76.6% and 1.5%, respectively, in 2009 when compared with 2008. Residential mortgage originations in the United States decreased 23.3% in 2008 when compared with 2007 according to the January 12, 2009 MBA Forecast. This decrease reflected declines in refinance originations and purchase originations of 23.1% and 23.6%, respectively.

Notwithstanding the increase in mortgage originations in 2009 over 2008, consolidated operating revenues for the Company decreased 4.8% year over year; with the financial services group decreasing 8.4% and the information solutions group increasing 3.1%. The decrease in operating revenues for the financial services group was primarily due to lower average revenues per title order closed, which reflected an increased mix of lower-premium refinance orders and a decreased mix of higher-premium commercial and resale orders, as well as the continued decline in home values. The increase in operating revenues for the information solutions group was primarily attributable to revenue growth at the information and outsourcing solutions segment due primarily to acquisition activity, market share growth and the increase in mortgage originations, offset in part by a decline in revenues at the risk mitigation and business solutions segment. This segment continues to be impacted by the downturn in domestic and international hiring, weakness in the credit markets and the overall economic slowdown.

Comparing 2008 with 2007, total operating revenues decreased 22.3%; with the financial services group decreasing 27.3% and the information solutions group decreasing 7.6%. The overall declines in mortgage originations, as well as the decline in home values, impacted the Company’s financial services group. In 2008, the information solutions group was also impacted by the decline in mortgage originations as well as difficulties in the credit and securitization markets combined with economic difficulties experienced by its customers.

39

Offsetting the impact of these factors on the financial services group and the information solutions group was the growth in default-related revenues and market share growth at the group’s larger mortgage banking customers. In addition, increases in risk management related sales of data analytics and the relatively consistent revenues generated by subscription-based businesses further offset the impact of the decline in mortgage originations for the information solutions group.

Realized pre-tax net investment losses and other-than-temporary impairment losses for the Company in 2009 were $30.1 million; with $24.1 million recognized at the financial services group, $4.2 million at the information solutions group and $1.8 million at Corporate. Realized pre-tax net investment losses and other-than-temporary impairment losses for the Company in 2008 were $100.5 million; with $88.7 million recognized at the financial services group, $10.1 million at the information solutions group and $1.7 million at Corporate.

Total expenses for the Company, before income taxes, decreased 10.1% in 2009 from 2008 and 23.6% in 2008 from 2007. For the financial services group, the decreases were 14.4% in 2009 from 2008 and 28.7% in 2008 from 2007. For the information solutions group, expenses increased 1.4% in 2009 over 2008 and decreased 4.6% in 2008 from 2007. The Company-wide decrease for both years primarily reflected a decline in title insurance agent retention due in large part to the decline in title insurance agent revenues, reductions in employee compensation expense, primarily reflecting employee reductions, a decline in other operating expenses due to overall cost-containment programs and a reduction in interest expense. Contributing to the decrease for 2008 was a reduction in title insurance claims expense primarily due to a lower reserve strengthening adjustment recorded in 2008 as compared to 2007. Offsetting these decreases for 2008 was a $19.7 million goodwill impairment charge at the risk mitigation and business solutions segment.

Net income attributable to the Company for 2009 was $199.7 million, or $2.09 per diluted share. Net loss attributable to the Company for 2008 was $26.3 million, or $0.28 per diluted share. Net loss attributable to the Company for 2007 was $3.1 million, or $0.03 per diluted share.

The continued tightening of mortgage credit and the uncertainty in general economic conditions continue to impact the demand for many of the Company’s products and services. These conditions have also had an impact on, and continue to impact, the performance and financial condition of some of the Company’s customers in many of the segments in which the Company operates; should these parties continue to encounter significant issues, those issues may lead to negative impacts on the Company’s revenue, claims, earnings and liquidity.

Management expects the above mentioned conditions will continue impacting many of the Company’s lines of business. Given this outlook, the Company continues its focus on controlling costs by reducing employee counts, consolidating offices, centralizing agency and administrative functions, optimizing management structure and rationalizing its brand strategy. The Company plans to continue these efforts where appropriate. In addition, the Company will continue to scrutinize the profitability of its agency relationships, increase its offshore leverage and develop new sales opportunities. Beginning at the end of 2008, the Company initiated an effort to optimize its claims handling process through, among other things, the centralization of claims handling, enhanced corporate control over the claims process and claims process standardization.

40

FINANCIAL SERVICES GROUP

Title Insurance and Services

	2009			2008			2007			2009 vs. 2008					2008 vs. 2007
										$ Change			% Change		$ Change			% Change
	(in thousands, except percentages)
Revenues
Direct operating revenues	$	2,031,937		$	2,179,521		$	2,827,166		$	(147,584	)	(6.8	)	$	(647,645	)	(22.9	)
Agent operating revenues		1,541,739			1,729,440			2,637,105			(187,701	)	(10.9	)		(907,665	)	(34.4	)
Operating revenues		3,573,676			3,908,961			5,464,271			(335,285	)	(8.6	)		(1,555,310	)	(28.5	)
Investment and other income		117,193			158,077			247,549			(40,884	)	(25.9	)		(89,472	)	(36.1	)
Net realized investment gains (losses) and OTTI losses recognized in earnings		(18,510	)		(84,513	)		(79,053	)		66,003		78.1			(5,460	)	(6.9	)
		3,672,359			3,982,525			5,632,767			(310,166	)	(7.8	)		(1,650,242	)	(29.3	)
Expenses
Salaries and other personnel costs		1,108,177			1,265,782			1,668,237			(157,605	)	(12.5	)		(402,455	)	(24.1	)
Premiums retained by agents		1,237,566			1,374,452			2,111,798			(136,886	)	(10.0	)		(737,346	)	(34.9	)
Other operating expenses		839,329			976,527			1,192,098			(137,198	)	(14.0	)		(215,571	)	(18.1	)
Provision for policy losses and other claims		207,804			343,041			709,935			(135,237	)	(39.4	)		(366,894	)	(51.7	)
Depreciation and amortization		67,135			80,460			82,000			(13,325	)	(16.6	)		(1,540	)	(1.9	)
Premium taxes		32,138			42,000			60,944			(9,862	)	(23.5	)		(18,944	)	(31.1	)
Interest		14,795			24,907			42,567			(10,112	)	(40.6	)		(17,660	)	(41.5	)
		3,506,944			4,107,169			5,867,579			(600,225	)	(14.6	)		(1,760,410	)	(30.0	)
Income (loss) before income taxes	$	165,415		$	(124,644	)	$	(234,812	)	$	290,059		232.7		$	110,168		46.9
Margins		4.5	%		(3.1	)%		(4.2	)%		7.6	%	243.9			1.0	%	24.9

Operating revenues from direct title operations decreased 6.8% in 2009 from 2008 and 22.9% in 2008 from 2007. The decrease in 2009 from 2008 was due to a decline in average revenues per order closed, offset in part by an increase in the number of orders closed by the Company’s direct operations. The decrease in 2008 from 2007 was due to a decline in both the number of orders closed by the Company’s direct operations and in the average revenues per order closed. The average revenues per order closed were $1,352, $1,558 and $1,666 for 2009, 2008 and 2007, respectively. The Company’s direct title operations closed 1,503,300, 1,398,700 and 1,696,500 title orders during 2009, 2008 and 2007, respectively. The fluctuations in closings primarily reflected the change in mortgage origination activity. Operating revenues from agency title operations decreased 10.9% in 2009 from 2008 and 34.4% in 2008 from 2007. These decreases were primarily due to the same factors impacting direct title operations and the cancellation of certain agency relationships. Management is continuing to analyze the terms and profitability of its title agency relationships and is working to amend agent agreements to the extent possible. Amendments being sought include, among others, changing the percentage of premiums retained by the agent and the deductible paid by the agent on claims; if changes to the agreements cannot be made, management may elect to terminate certain agreements.

Total operating revenues for the title insurance segment (direct and agency operations) contributed by new acquisitions were $11.5 million, $12.5 million and $67.8 million for 2009, 2008 and 2007, respectively.

41

Investment and other income decreased 25.9% in 2009 from 2008 and 36.1% in 2008 from 2007. The decrease in 2009 from 2008 primarily reflected declining yields earned from the investment portfolio, a decrease in interest earned on certain escrow deposits, which reflected lower yields and lower balances, and a decrease in investment income at the Company’s trust division as a result a decline in deposits. These decreases were partially offset by an increase in the average investment portfolio balance. The decrease in 2008 from 2007 primarily reflected declining yields earned from the investment portfolio and a decrease in interest earned on certain escrow deposits, which reflected lower yields and lower balances. These decreases were partially offset by an increase in investment income at the Company’s trust division as a result of increased deposits.

Net realized investment losses and other-than-temporary impairment losses recognized in earnings for the title insurance segment totaled $18.5 million, $84.5 million and $79.1 million for 2009, 2008 and 2007, respectively. Net realized losses in 2009 primarily reflected $33.1 million in realized impairment losses on this segment’s debt and equity investment portfolio, offset in part by certain realized net investment gains, which included an $8.4 million gain on the sale of a preferred equity security. Net realized losses in 2008 were primarily driven by a $37.3 million write-down to reflect the permanent impairment of a long-term investment in a title insurance agent, a $30.3 million impairment loss on preferred securities issued by the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) and $7.5 million in other long-term asset permanent impairments.

The title insurance segment (primarily direct operations) is labor intensive; accordingly, a major variable expense component is salaries and other personnel costs. This expense component is affected by two competing factors; the need to monitor personnel changes to match the level of corresponding or anticipated new orders, and the need to provide quality service.

Title insurance salaries and other personnel costs decreased 12.5% in 2009 from 2008 and 24.1% in 2008 from 2007. The decrease in 2009 from 2008 was primarily due to employee reductions, offset in part by employee separations costs, an increase in employee benefit expense due primarily to the profit-driven 401(k) match and salary expense associated with new acquisitions. The Company reduced staff by approximately 1,050 since the beginning of 2009, incurring $10.8 million in employee separation costs. The 401(k) match, which was not made by the Company in 2008, totaled $15.1 million in 2009. Salary expense associated with new acquisitions was $4.8 million. The decrease in 2008 from 2007 was attributable to employee reductions, salary reductions, the modification of bonus programs and reductions in employee benefits expense, including the profit-driven 401(k) match, offset in part by employee separation costs. The reduction in the profit-driven 401(k) match is due to the fact that the Company did not meet the requirement for a 401(k) plan match in 2008. The Company reduced staff by approximately 4,300 since the beginning of 2008, incurring approximately $23.7 million in employee separation costs.

The Company continues to closely monitor order volumes and related staffing levels and will adjust staffing levels as considered necessary. The Company’s direct title operations opened 1,991,300, 1,960,800, and 2,401,500 orders in 2009, 2008, and 2007, respectively, representing an increase of 1.6% in 2009 over 2008 and a decrease of 18.4% in 2008 from 2007.

A summary of agent retention and agent revenues is as follows:

	2009			2008			2007
	(in thousands, except percentages)
Agent retention	$	1,237,566		$	1,374,452		$	2,111,798
Agent revenues	$	1,541,739		$	1,729,440		$	2,637,105
% retained by agents		80.3	%		79.5	%		80.1	%

42

The premium split between underwriter and agents is in accordance with the respective agency contracts and can vary from region to region due to divergences in real estate closing practices, as well as rating structures. As a result, the percentage of title premiums retained by agents varies due to the geographical mix of revenues from agency operations. This change was primarily due to the cancellation and/or modification of certain agency relationships with unfavorable splits, as well as regional variances (i.e., the agency share or split varies from region to region and thus the geographic mix of agency revenues causes this variation).

Title insurance other operating expenses (principally direct operations) decreased 14.0% in 2009 from 2008 and 18.1% in 2008 from 2007. The decrease in 2009 from 2008 was primarily due to lower occupancy costs as a result of the continued consolidation/closure of certain title offices and other cost-containment programs, offset in part by $6.3 million in other operating costs associated with new acquisitions and $4.4 million in costs associated the office consolidation/closures. The decrease in 2008 from 2007 was primarily due to a decline in title production costs associated with the decrease in business volume, lower occupancy costs as a result of the consolidation/closure of certain title offices and other cost-containment programs. Offsetting in part these decreases were $26.0 million in costs associated with office consolidation/closure and $5.0 million in other operating costs associated with new acquisitions.

The provision for title insurance losses, expressed as a percentage of title insurance operating revenues, was 5.8% in 2009, 8.8% in 2008 and 13.0% in 2007. The current year rate reflects an expected ultimate loss rate of 6.0% for policy year 2009, with a minor downward adjustment to the reserve for certain prior policy years. The prior year rate of 8.8% included a $78.0 million reserve strengthening adjustment. The adjustment reflected changes in estimates for ultimate losses expected, primarily from policy years 2006 and 2007. The changes in estimates resulted primarily from higher than expected claims emergence, in both frequency and aggregate amounts, experienced during 2008, for those policy years. There were many factors that impacted the claims emergence, including but not limited to: decreases in real estate prices during 2008; increases in defaults and foreclosures during 2008; and higher than expected claims emergence from lenders policies. The rate of 13.0% for 2007 included $365.9 million in reserve strengthening adjustments, which reflected changes in estimates for ultimate losses expected, primarily from policy years 2004 through 2006. The changes in estimates resulted primarily from higher than expected claims emergence, in both frequency and aggregate amounts, experienced during 2007. There were many factors that impacted the claims emergence, including but not limited to decreases in real estate prices during 2007 and increases in defaults and foreclosures during 2007. In addition, the reserve strengthening adjustments reflected a large single fraud loss resulting from a settlement during 2007 of a claim under a closing protection letter issued during 2005. The claim involved multiple properties and the settlement amount exceeded what had been included in reserves for that type of claim, such reserves having been established based on the Company’s actuarial analysis. Since the loss was determined to be an isolated event with no future trend component, the adjustment to reserves associated with the closing protection letter only impacted 2007. The reserve strengthening adjustments made during 2007 also reflected an increase in claims emergence from a large title agent related to the geographic expansion of the agent’s business combined with changes in economic conditions. In addition, the adjustments reflected higher-than-expected claims from a recently-acquired underwriter, due to changes in the business strategy with respect to the underwriter post-acquisition combined with unfavorable external economic events. The Company continuously monitors the impact, if any, of these types of events on the Company’s reserve balances and adjusts the reserves when facts and circumstances indicate a change is warranted.

The current economic environment appears to have more potential for volatility than usual over the short term, particularly in regard to real estate prices and mortgage defaults, which directly affect title claims. Relevant contributing factors include general economic instability and government actions that may mitigate or exacerbate recent trends. Other factors, including factors not yet identified, may also influence claims development. At this point, economic and market conditions appear to be improving, yet significant uncertainty remains. This environment results in increased potential for actual claims experience to vary significantly from projections, in either direction, which would directly affect the claims provision. If actual claims vary significantly from expected, reserves may need to be adjusted to reflect updated estimates of future claims.

43

The volume and timing of title insurance claims are subject to cyclical influences from real estate and mortgage markets. Title policies issued to lenders are a large portion of the Company’s title insurance volume. These policies insure lenders against losses on mortgage loans due to title defects in the collateral property. Even if an underlying title defect exists that could result in a claim, often the lender must realize an actual loss, or at least be likely to realize an actual loss, for title insurance liability to exist. As a result, title insurance claims exposure is sensitive to lenders’ losses on mortgage loans, and is affected in turn by external factors that affect mortgage loan losses.

A general decline in real estate prices can expose lenders to greater risk of losses on mortgage loans, as loan-to-value ratios increase and defaults and foreclosures increase. The current environment may continue to have increased potential for claims on lenders’ title policies, particularly if defaults and foreclosures are at elevated levels. Title insurance claims exposure for a given policy year is also affected by the quality of mortgage loan underwriting during the corresponding origination year. Management believes that sensitivity of claims to external conditions in real estate and mortgage markets is an inherent feature of title insurance’s business economics that applies broadly to the title insurance industry. Lenders have been experiencing higher losses on mortgage loans from prior years, including loans that were originated during the past several years. These losses have led to higher title insurance claims on lenders policies, and also have accelerated the reporting of claims that would have been realized later under more normal conditions.

Loss ratios (projected to ultimate value) for policy years 1991-2004 are all below 6.0% and average 4.8%. By contrast, loss ratios for policy years 2005-2007 range from 7.6% to 7.8%. The major causes of the higher loss ratios for those three policy years are believed to be confined mostly to that period. These causes included: rapidly increasing residential real estate prices which led to an increase in the incidences of fraud, lower mortgage loan underwriting standards and a higher concentration than usual of subprime mortgage loan originations.

The projected ultimate loss ratios for policy years 2009 and 2008 are 6.0% and 6.5%, respectively, which are lower than the ratios for 2005 through 2007. These projections are based in part on an assumption that more favorable underwriting conditions existed in 2008 and 2009 than in 2005-2007, including tighter loan underwriting standards and lower housing prices. Current claims data from both policy years 2008 and 2009, while still at an early stage of development, supports this assumption.

Insurers generally are not subject to state income or franchise taxes. However, in lieu thereof, a “premium” tax is imposed on certain operating revenues, as defined by statute. Tax rates and bases vary from state to state; accordingly, the total premium tax burden is dependent upon the geographical mix of operating revenues. The Company’s underwritten title company (noninsurance) subsidiaries are subject to state income tax and do not pay premium tax. Accordingly, the Company’s total tax burden at the state level for the title insurance segment is composed of a combination of premium taxes and state income taxes. Premium taxes as a percentage of title insurance operating revenues were 0.9% for 2009 and 1.1% for 2008 and 2007.

In general, the title insurance business is a lower profit margin business when compared to the Company’s other segments. The lower profit margins reflect the high cost of producing title evidence whereas the corresponding revenues are subject to regulatory and competitive pricing restraints. Due to this relatively high proportion of fixed costs, title insurance profit margins generally improve as closed order volumes increase. Title insurance profit margins are affected by the composition (residential or commercial) and type (resale, refinancing or new construction) of real estate activity. In addition, profit margins from refinance transactions vary depending on whether they are centrally processed or locally processed. Profit margins from resale, new construction and centrally processed refinance transactions are generally higher than from locally processed refinancing transactions because in many states there are premium discounts on, and cancellation rates are higher for, refinance transactions. Title insurance profit margins are also affected by the percentage of operating revenues generated by agency operations. Profit margins from direct operations are generally higher than from agency operations due primarily to the large portion of the premium that is retained by the agent. The pre-tax margin was 4.5% for the year ended December 31, 2009. The pre-tax margin losses for the years ended December 31, 2008 and 2007 were 3.1% and 4.2%, respectively.

44

Specialty Insurance

	2009			2008			2007			2009 vs. 2008					2008 vs. 2007
										$ Change			% Change		$ Change			% Change
	(in thousands, except percentages)
Revenues
Operating revenues	$	269,631		$	286,321		$	302,822		$	(16,690	)	(5.8	)	$	(16,501	)	(5.4	)
Investment and other income		13,431			15,657			18,848			(2,226	)	(14.2	)		(3,191	)	(16.9	)
Net realized investment gains (losses) and OTTI losses recognized in earnings		(5,523	)		(4,161	)		1,770			(1,362	)	(32.7	)		(5,931	)	(335.1	)
		277,539			297,817			323,440			(20,278	)	(6.8	)		(25,623	)	(7.9	)
Expenses
Salaries and other personnel costs		54,907			56,532			60,585			(1,625	)	(2.9	)		(4,053	)	(6.7	)
Other operating expenses		44,297			49,704			50,962			(5,407	)	(10.9	)		(1,258	)	(2.5	)
Provision for policy losses and other claims		140,895			166,004			165,192			(25,109	)	(15.1	)		812		0.5
Depreciation and amortization		4,275			3,329			2,190			946		28.4			1,139		52.0
Premium taxes		4,346			4,366			4,776			(20	)	(0.5	)		(410	)	(8.6	)
Interest		26			23			7			3		13.0			16		228.6
		248,746			279,958			283,712			(31,212	)	(11.1	)		(3,754	)	(1.3	)
Income (loss) before income taxes	$	28,793		$	17,859		$	39,728		$	10,934		61.2		$	(21,869	)	(55.0	)
Margins		10.4	%		6.0	%		12.3	%		4.4	%	73.0			(6.3	)%	(51.2	)

Specialty insurance operating revenues decreased 5.8% in 2009 from 2008 and 5.4% in 2008 from 2007. These decreases primarily reflected declines in business volume impacting both the property and casualty insurance division and the home warranty division.

Investment and other income decreased 14.2% in 2009 from 2008 and 16.9% in 2008 from 2007. These decreases primarily reflected the decreased yields earned from the investment portfolio.

Net realized investment losses and other-than-temporary impairment losses recognized in earnings for the specialty insurance segment totaled $5.5 million in 2009, compared with net realized losses of $4.2 million in 2008 and net realized gains of $1.8 million for 2007. The current year net realized losses were primarily driven by impairment losses taken on certain debt, preferred equity and common equity securities. The prior year losses were primarily due to realized losses on the sale of certain securities.

Specialty insurance salaries and other personnel costs and other operating expenses decreased 6.6% in 2009 from 2008 and 4.8% in 2008 from 2007. The decreases were primarily due to employee reductions as well as other cost-containment programs.

The provision for home warranty claims, expressed as a percentage of home warranty operating revenues, was 53.9% in 2009, 60.5% in 2008 and 53.8% in 2007. The decrease in rate in 2009 from 2008 was primarily due to a reduction in the average cost of claims. The increase in rate in 2008 over 2007 was primarily due to an increase in the severity of claims due in part to an increase in the cost of replacing air conditioners with models that met new federal guidelines related to energy efficiency.

45

The provision for property and casualty claims, expressed as a percentage of property and casualty operating revenues, was 49.8% in 2009, 54.3% in 2008 and 55.6% in 2007. The decrease in the rate in 2009 from 2008 was the result of a decline in seasonal winter storm and wildfire losses, as well as lower routine or core losses.

Premium taxes as a percentage of specialty insurance operating revenues were 1.6% in 2009, 1.5% in 2008 and 1.6% in 2007.

A large part of the revenues for the specialty insurance businesses are not dependent on the level of real estate activity, due to the fact that a large portion are generated from renewals. With the exception of loss expense, the majority of the expenses for this segment are variable in nature and therefore generally fluctuate consistent with revenue fluctuations. Accordingly, profit margins for this segment (before loss expense) are relatively constant, although as a result of some fixed expenses, profit margins (before loss expense) should nominally improve as revenues increase. Pre-tax margins were 10.4%, 6.0% and 12.3% for 2009, 2008 and 2007, respectively.

INFORMATION SOLUTIONS

Information and Outsourcing Solutions

	2009			2008			2007			2009 vs. 2008					2008 vs. 2007
										$ Change			% Change		$ Change			% Change
	(in thousands, except percentages)
Revenues
Operating revenues	$	838,898		$	675,229		$	735,562		$	163,669		24.2		$	(60,333	)	(8.2	)
Investment and other income		71,548			52,758			45,062			18,790		35.6			7,696		17.1
Net realized investment gains (losses)		(6,221	)		(275	)		(437	)		(5,946	)	NM	1		162		37.1
		904,225			727,712			780,187			176,513		24.3			(52,475	)	(6.7	)
Expenses
Salaries and other personnel costs		197,250			192,688			214,685			4,562		2.4			(21,997	)	(10.2	)
Other operating expenses		450,546			342,232			366,775			108,314		31.6			(24,543	)	(6.7	)
Provision for policy losses and other claims		36,694			23,898			18,086			12,796		53.5			5,812		32.1
Depreciation and amortization		23,022			23,707			22,045			(685	)	(2.9	)		1,662		7.5
Interest		(6,270	)		(6,228	)		(5,388	)		(42	)	(0.7	)		(840	)	(15.6	)
		701,242			576,297			616,203			124,945		21.7			(39,906	)	(6.5	)
Income (loss) before income taxes	$	202,983		$	151,415		$	163,984		$	51,568		34.1		$	(12,569	)	(7.7	)
Margins		22.4	%		20.8	%		21.0	%		1.6	%	7.9			(0.2	)%	(1.0	)

(1) Not meaningful

Information and outsourcing solutions operating revenues increased 24.2% in 2009 over 2008 and decreased 8.2% in 2008 from 2007. Total operating revenues for the information and outsourcing solutions segment contributed by new acquisitions were $88.4 million, $4.6 million and $3.7 million for 2009, 2008 and 2007, respectively. The current year acquisition related to the Company’s purchase of its partner’s membership interest in a national joint venture. The increase in revenues in 2009 over 2008 primarily reflected market share gains in many lines of business, increased volumes due to increased loan origination volumes, (primarily refinancings), and an increase in the volume of appraisal and default-related business due to the higher level of loan loss mitigation and

46

foreclosure-related activity occurring in the market. The revenue decrease in 2008 from 2007 primarily reflected a decline in volume at the tax service, flood certification, traditional appraisal businesses due to the continued decline in mortgage originations, and revenues from the Louisiana Road Home Project, offset in part by an increase in volume for default and outsourcing services and default-related valuation products due to higher default and foreclosure activity throughout most of 2008. Also negatively impacting the revenues at the tax service business in both 2009, 2008 and 2007 were net increases in the required deferred revenue adjustment totaling $1.5 million in 2009, $1.3 million in 2008 and $1.9 million in 2007 due to the lengthening of the service period associated with that portfolio. The information and outsourcing solutions segment provides services at different stages of the loan origination cycle, with revenues from valuation and flood certifications occurring earlier in the origination cycle and with tax service revenues generally being recognized after the loan has been closed by the lender. As a result, the tax service revenues for this segment typically lag the normal loan origination cycle.

Information and outsourcing solutions investment and other income totaled $71.5 million, $52.8 million and $45.1 million for 2009, 2008 and 2007, respectively, increases of 35.6% in 2009 over 2008 and 17.1% in 2008 over 2007. The increase in investment income in 2009 over 2008 and 2008 over 2007 primarily reflects the growth in and improved results of the segment’s national joint ventures.

Information and outsourcing solutions salaries and other personnel costs increased 2.4% in 2009 over 2008 and decreased 10.2% in 2008 from 2007. Included in information and outsourcing solutions salaries and other personnel costs for 2009, 2008 and 2007 were $7.6 million, $2.5 million and $2.3 million of costs associated with new acquisitions, respectively. The increases in 2009 were primarily due to increased expenses at the appraisal, default-related and tax service businesses due to hiring at those businesses to effectively service increased volumes arising from higher levels of activity and business from new clients, as well as approximately $2.0 million of severance expense incurred during the year. The increases were offset in part by expense reduction actions taken throughout 2008 and early 2009 and continued off shoring initiatives. The decreases in 2008 were primarily due to general expense reductions in response to the decrease in business volume, including gross domestic headcount reductions in force of 8.8%, and reductions in employee benefit expenses, including bonus and the profit-driven 401(k) match offset by the benefit of the employees transferred to other segments for management reporting purposes. The reduction in the profit driven 401(k) match is due to the fact that the Company did not meet the requirement for a 401(k) plan match in 2008. These decreases were offset by increased expenses at the default-related businesses due to increased revenues at those entities under the current market conditions. Also offsetting these decreases in 2008 was an increase in severance expense of $3.1 million.

Information and outsourcing solutions other operating expenses increased 31.6% in 2009 over 2008 and decreased 6.7% in 2008 from 2007. The increase in 2009 over 2008 was primarily due to $70.3 million of costs associated with new acquisitions and higher cost of goods sold associated with the higher volume of appraisal and default-related revenues, which offset the impact of the 2008 cost savings initiatives. Excluding cost of goods sold, which increased $88.4 million in the current year, other operating expenses for the segment were up 11.9% in the current year with increased bad debt expense and other variable costs of sales offsetting the impact of the cost saving initiatives implemented by management. The decrease in 2008 from 2007 reflected general expense reductions in response to the decrease in business volume, primarily at the tax servicing, flood and appraisal-related businesses, as well as the impact of management’s cost savings initiatives, offset by increased expenses at the default-related businesses due to increased revenues at those entities resulting from the current market conditions, $2.1 million of costs associated with new acquisitions, and increased legal fees primarily associated with appraisal-related cases.

The provision for policy losses and other claims increased by 53.5% in 2009 relative to 2008, due to an increase in claims associated with the segment’s tax service outsourcing business primarily in connection with higher volumes of activity and a higher rate of claims on loans. The provision for policy losses and other claims increased by 32.1% in 2008 relative to 2007, due to a significant one-time loss associated primarily with commercial tax outsourcing, higher than usual levels of claims on traditional tax outsourcing and increases in the

47

level of business at default-related entities (which typically carry a higher level of claims). Management continues to assess the operating effectiveness of these businesses and does not anticipate the level of increases in claims to be recurring in future years.

Many of the businesses included in the information and outsourcing solutions segment have a relatively high proportion of fixed costs. As such, profit margins generally decline as revenues decline, with default-related products providing some counter-cyclicality. Revenues for the information and outsourcing solutions segment are primarily dependent on the level of mortgage origination and servicing activity. The information and outsourcing solutions segment had pre-tax margins of 22.4%, 20.8% and 21.0%, in 2009, 2008 and 2007, respectively. The pre-tax margin in 2009 was impacted by the increase in revenues from legacy businesses, offset slightly by growth in several valuation products which have lower associated margins. The pre-tax margin in 2008 was impacted by the reduction in revenues, a shift in the revenues and the impact of the adjustments to the tax service revenue. Offsetting these factors were benefits from cost reduction efforts as well as the strength of the segment’s relationships with large, national lenders that have experienced market share growth in spite of the current market conditions.

Data and Analytic Solutions

	2009			2008			2007			2009 vs. 2008					2008 vs. 2007
										$ Change			% Change		$ Change			% Change
	(in thousands, except percentages)
Revenues
Operating revenues	$	526,144		$	543,567		$	570,497		$	(17,423	)	(3.2	)	$	(26,930	)	(4.7	)
Investment and other income		2,981			5,000			3,773			(2,019	)	(40.4	)		1,227		32.5
Net realized investment gains (losses) and OTTI losses recognized in earnings		3,317			(3,540	)		56,805			6,857		193.7			(60,345	)	(106.2	)
		532,442			545,027			631,075			(12,585	)	(2.3	)		(86,048	)	(13.6	)
Expenses
Salaries and other personnel costs		282,342			299,766			305,268			(17,424	)	(5.8	)		(5,502	)	(1.8	)
Other operating expenses		82,535			88,917			97,752			(6,382	)	(7.2	)		(8,835	)	(9.0	)
Provision for policy losses and other claims		(1,941	)		381			729			(2,322	)	(609.4	)		(348	)	(47.7	)
Depreciation and amortization		63,193			68,568			65,155			(5,375	)	(7.8	)		3,413		5.2
Interest		5,897			7,145			8,256			(1,248	)	(17.5	)		(1,111	)	(13.5	)
		432,026			464,777			477,160			(32,751	)	(7.0	)		(12,383	)	(2.6	)
Income (loss) before income taxes	$	100,416		$	80,250		$	153,915		$	20,166		25.1		$	(73,665	)	(47.9	)
Margins		18.9	%		14.7	%		24.4	%		4.1	%	28.1			(9.7	)%	(39.6	)

Data and analytic solutions segment operating revenues decreased 3.2% and 4.7% in 2009 from 2008 and in 2008 from 2007, respectively. The decrease in 2009 from 2008 reflected declines in revenues associated with sales of property information (including custom fulfillment projects) and Multiple Listing Service (“MLS”) software products which were down relative to the prior year. These decreases were primarily due to the impact of market conditions on mortgage banking and real estate clients. In addition, the segment’s revenues were impacted by the consolidation of several large clients. These decreases were offset in part by increased demand

48

for title and document products due to improved loan origination activity, primarily refinancings. The decrease in 2008 from 2007 was primarily due to the effects of the continued slowdown in mortgage originations and the ongoing tightening of the credit markets. These conditions have resulted in a decrease for many of the segment’s traditional loan origination related products, a decrease in mortgage securitization risk analytics, and a drop in the demand for some of the mortgage analytic product offerings; these decreases were offset in part by growth in securities analytics and risk mitigation, custom and licensing product revenues.

Data and analytic solutions investment and other income totaled $3.0 million, $5.0 million and $3.8 million for 2009, 2008 and 2007, respectively, a decrease of 40.4% in 2009 from 2008 and an increase of 32.5% in 2008 over 2007.

Data and analytic solutions net realized investment gains totaled $3.3 million in 2009, net realized investment losses totaled $3.5 million in 2008 and net realized investment gains totaled $56.8 million in 2007. The net realized investment gain during 2009 reflects gains on sales of investment securities during the year offset by an other-than-temporary impairment loss recognized in earnings of $1.8 million on this segment’s debt and equity investment portfolio. The net realized investment loss during 2008 reflects a $3.6 million investment loss related to a decline in value of Fannie Mae and Freddie Mac securities. The net realized investment gain in 2007 included a $77.1 million realized gain resulting from the combination of the Company’s RES division with CoreLogic Systems, Inc. Offsetting in part the 2007 realized gains were realized investment losses of $22.2 million consisting of impairment losses related to the permanent impairment of certain unconsolidated affiliates.

Data and analytic solutions salaries and other personnel costs decreased 5.8% in 2009 from 2008 and decreased 1.8% in 2008 from 2007. The decrease in salaries and other personnel costs in 2009 from 2008 was primarily driven by a 6.5% decrease in domestic headcount relative to the prior year due to management’s cost containment initiatives implemented in 2008 and 2009. The decrease of salaries and other personnel costs in 2008 from 2007 was primarily due to general expense reductions in response to the decrease in business volume, including gross domestic headcount reductions in force of 12.8%, and reductions in employee benefit expenses, including bonus and the profit-driven 401(k) match. The reduction in the profit driven 401(k) match is due to the fact that the Company did not meet the requirement for a 401(k) plan match. Offsetting this decrease was an increase in severance expense of $5.3 million.

Data and analytic solutions other operating expenses decreased 7.2% in 2009 from 2008 and decreased 9.0% in 2008 from 2007. When comparing 2009 to 2008, the improvements generated by management’s cost containment initiatives were offset in part by increased foreign currency translation adjustments related to the India operations and a higher level bad debt expense due to the current economic environment. Offsetting the decrease in 2008 were increases in restructuring costs totaling $6.7 million.

Many of the businesses included in the data and analytic solutions segment are database intensive, with a relatively high proportion of fixed costs. As such, profit margins generally decline as revenues decline. Revenues for the data and analytic solutions segment are, in part, dependent on real estate activity but are less cyclical as a result of a more diversified customer base and a greater percentage of subscription-based revenue. Pre-tax margins were 18.9%, 14.7% and 24.4%, for 2009, 2008, and 2007, respectively. The impact of the lower revenues was offset by the impact of cost savings initiatives implemented in 2008 and 2009, resulting in the improved margins in 2009 relative to 2008. The lower revenues, combined with the high level of fixed costs, primarily drove the decrease in 2008 from 2007; the impact of these items was offset by the impact of the cost cutting initiatives implemented by management. If the impact of the gain recognized in connection with the acquisition of CoreLogic Systems, Inc. had been excluded, margins for 2007 would have been 13.9%.

49

Risk Mitigation and Business Solutions

	2009			2008			2007			2009 vs. 2008					2008 vs. 2007
										$ Change			% Change		$ Change			% Change
	(in thousands, except percentages)
Revenues
Operating revenues	$	695,067		$	779,109		$	856,542		$	(84,042	)	(10.8	)	$	(77,433	)	(9.0	)
Investment and other income		11,700			9,422			10,947			2,278		24.2			(1,525	)	(13.9	)
Net realized investment gains (losses)		(1,330	)		(6,257	)		117,237			4,927		78.7			(123,494	)	(105.3	)
		705,437			782,274			984,726			(76,837	)	(9.8	)		(202,452	)	(20.6	)
Expenses
Salaries and other personnel costs		206,015			246,396			275,918			(40,381	)	(16.4	)		(29,522	)	(10.7	)
Other operating expenses		401,598			405,582			421,994			(3,984	)	(1.0	)		(16,412	)	(3.9	)
Provision for policy losses and other claims		—			—			3			—		—			(3	)	(100.0	)
Depreciation and amortization		43,441			64,756			43,182			(21,315	)	(32.9	)		21,574		50.0
Interest		842			2,548			10,638			(1,706	)	(67.0	)		(8,090	)	(76.0	)
		651,896			719,282			751,735			(67,386	)	(9.4	)		(32,453	)	(4.3	)
Income (loss) before income taxes	$	53,541		$	62,992		$	232,991		$	(9,451	)	(15.0	)	$	(169,999	)	(73.0	)
Margins		7.6	%		8.1	%		23.7	%		(0.5	)%	(5.7	)		(15.6	)%	(66.0	)

Risk mitigation and business solutions operating revenues decreased 10.8% in 2009 from 2008 and decreased 9.0% in 2008 from 2007; new acquisitions contributed $0.3 million and $5.8 million of operating revenues in 2009 and 2008, respectively. The overall decrease in operating revenue in 2009 is directly related to the downturn in domestic and international hiring, weakness in the credit markets, and overall economic slowdown, which lead to declines in revenues in the credit, employer, multi-family and investigative/ litigation support lines of business. These declines were offset to an extent by increased revenues in 2009 in the segment’s lead generation business. The 2008 decreases in revenue were due to the downturn in domestic hiring, the decline in the mortgage industry, weakness in the credit markets, and the overall economic slowdown.

Risk mitigation and business solutions investment and other income totaled $11.7 million, $9.4 million and $10.9 million for 2009, 2008 and 2007, respectively, an increase of 24.2% in 2009 over 2008 and a decrease of 13.9% in 2008 from 2007.

Risk mitigation and business solutions net realized investment losses totaled $1.3 million and $6.3 million in 2009 and 2008, respectively, and net realized gains totaled $117.2 million in 2007. The high level of losses in 2008 were mainly attributed to the segment’s loss on sale of discontinued operations which were disposed of in 2008. The 2007 total included $117.8 million of realized gains resulting from the sale of a portion of its DealerTrack Holdings, Inc. investment and its sale of the US SEARCH subsidiary.

Risk mitigation and business solutions salaries and other personnel costs decreased 16.4% in 2009 from 2008 and decreased 10.7% in 2008 from 2007. The overall decrease in 2009 in salaries and other personnel costs was attributed to strategic reductions in employees, office consolidations, a decline in compensation related to

50

revenue and profitability and a reduction in 401(k) match expense. The impact of these cost savings initiatives was offset in 2009 by $9.1 million of expense associated with accelerated vesting of stock-based compensation due to the buy-in of the remaining noncontrolling interest in First Advantage during the fourth quarter of 2009 and $1.9 million of severance expense incurred during the year. Excluding acquisition activity, risk mitigation and business solutions salaries and other personnel costs decreased $31.8 million, or 11.5% for 2008 from 2007. Risk mitigation and business solutions incurred $3.5 million of severance expense in 2008. Severance and acquisition related increases were offset by a decrease in salaries and other personnel costs due to the reduction in production volumes in 2008, domestic headcount reductions in force of 13.2%, lower share-based compensation in 2008 and the $8.0 million of severance included in the 2007 results related to the departure of the former chief executive officer.

Risk mitigation and business solutions other operating expenses decreased 1.0% in 2009 from 2008 and decreased 3.9% in 2008 from 2007. Excluding other operating expenses of $2.0 million associated with new acquisitions for 2008, other operating expenses for risk mitigation and business solutions decreased 4.4% in 2008 from 2007. The overall decrease in other operating expenses was primarily attributed to office consolidations and general cost reduction measures. Offsetting these improvements were higher cost of goods sold related to higher revenues in the lead generation business and bad debt expense associated with the lead generation business and $4.3 million of transaction costs related to the buy-in of the remaining noncontrolling interest in First Advantage during the fourth quarter of 2009. Excluding cost of goods sold, which increased $6.2 million in the current year and transaction costs, other operating expenses were down $14.4 million, or 11.7% in the current year. For 2008, the decreases are due to a decrease in temporary labor, leased equipment, marketing, and office expenses related to the overall initiative to reduce costs.

Risk mitigation and business solutions depreciation and amortization decreased by 32.9% in 2009 from 2008 and increased by 50.0% in 2008 over 2007. The decrease in 2009 relative to 2008 was due to the fact that there was no significant impairment charges recorded in 2009 similar to those recorded in 2008. The 2008 increase is primarily due to a goodwill impairment charge of $19.7 million related to the data services reporting unit. The Company’s annual evaluation in 2008 resulted in an impairment loss of $19.7 million in the data services reporting unit in the fourth quarter based primarily upon diminished earnings and cash flow expectations for the lead generation business and lower residual valuation multiples existing in the then present market conditions. Additionally, approximately $0.9 million was recorded related to asset write-downs and $1.6 million related to identifiable intangible assets write-downs for office consolidations.

Many of the expenses incurred by the risk mitigation and business solutions segment are variable in nature and therefore generally decrease as revenues decrease. Most of the revenues for the risk mitigation and business solutions segment are unaffected by real estate activity, with the exception of the mortgage credit business, which is dependent on real estate activity. Pre-tax margins were 7.6%, 8.1% and 23.7%, for 2009, 2008 and 2007, respectively. Excluding the transaction related costs in 2009, the pre-tax margins would have been 8.2%, excluding the goodwill impairment charge in 2008, the pre-tax margins for the segment would have been 10.6% and excluding the realized gains in 2007, pre-tax margins for the segment would have been 13.3%.

51

Corporate

	2009			2008			2007			2009 vs. 2008					2008 vs. 2007
										$ Change			% Change		$ Change			% Change
	(in thousands, except percentages)
Revenues
Investment and other income	$	5,749		$	698		$	(2,395	)	$	5,051		723.6		$	3,093		129.1
Gain on stock issued by a subsidiary		—			1,325			9,426			(1,325	)	(100.0	)		(8,101	)	(85.9	)
Net realized investment gains (losses)		(1,826	)		(1,750	)		(30,654	)		(76	)	(4.3	)		28,904		94.3
		3,923			273			(23,623	)		3,650		NM	1		23,896		101.2
Expenses
Salaries and other personnel costs		39,375			39,592			78,858			(217	)	(0.5	)		(39,266	)	(49.8	)
Other operating expenses		20,491			30,157			45,627			(9,666	)	(32.1	)		(15,470	)	(33.9	)
Depreciation and amortization		19,081			22,125			17,767			(3,044	)	(13.8	)		4,358		24.5
Interest		52,327			52,060			37,868			267		0.5			14,192		37.5
		131,274			143,934			180,120			(12,660	)	(8.8	)		(36,186	)	(20.1	)
Income (loss) before income taxes	$	(127,351	)	$	(143,661	)	$	(203,743	)	$	16,310		11.4		$	60,082		29.5

(1) Not meaningful

Gain on stock issued by a subsidiary represents realized gains relating to the issuance of shares by First Advantage.

Net realized investment losses for 2007 included $35.0 million of impairment losses primarily related to the permanent impairment of certain unconsolidated affiliates.

Corporate salaries and other personnel costs decreased 0.5% in 2009 from 2008 and decreased 49.8% in 2008 from 2007. The decrease in 2009 from 2008 was primarily due to changes in technology initiatives and the impact of other corporate-wide cost saving initiatives that have been implemented by the Company. These decreases were offset by severance of $5.8 million in 2009. The decrease in 2008 from 2007 was primarily due to changes in technology initiatives, salary reductions, employee reductions and the impact of other corporate-wide cost saving initiatives that have been implemented by the Company. Contributing to the reduction in 2008 from 2007 was a decrease in employee benefit and retirement costs.

Corporate other operating expenses decreased 32.1% in 2009 from 2008 and 33.9% in 2008 from 2007. These decreases were primarily due to cost reductions.

Interest expense increased 0.5% in 2009 over 2008 and 37.5% in 2008 over 2007. Interest expense includes interest associated with inter-company notes issued to the home warranty business (a component of the specialty insurance segment) and the title insurance business. These amounts totaled $10.8 million, $8.9 million and $2.9 million for 2009, 2008 and 2007, respectively. Excluding inter-company interest expense, corporate interest expense increased in 2008 relative to 2007 due to incremental draws on the Company’s credit facility. The inter-company interest expense at the corporate level and related interest income which is included in the title insurance and specialty insurance segments are eliminated in the consolidated financial statements.

52

Eliminations

	2009			2008			2007			2009 vs. 2008					2008 vs. 2007
										$ Change			% Change		$ Change			% Change
	(in thousands, except percentages)
Revenues
Operating revenues	$	(112,112	)	$	(112,539	)	$	(102,475	)	$	427		0.4		$	(10,064	)	(9.8	)
Investment and other income		(11,036	)		(9,331	)		(3,714	)		(1,705	)	(18.3	)		(5,617	)	(151.2	)
		(123,148	)		(121,870	)		(106,189	)		(1,278	)	(1.0	)		(15,681	)	(14.8	)
Expenses
Other operating expenses		(112,068	)		(112,539	)		(102,475	)		471		0.4			(10,064	)	(9.8	)
Depreciation and amortization		(225	)		—			—			(225	)	—			—		—
Interest		(10,855	)		(9,331	)		(3,714	)		(1,524	)	(16.3	)		(5,617	)	(151.2	)
		(123,148	)		(121,870	)		(106,189	)		(1,278	)	(1.0	)		(15,681	)	(14.8	)
Income (loss) before income taxes	$	—		$	—		$	—		$	—		—		$	—		—

Eliminations represent revenues and related expenses associated with inter-segment sales of services and products, as well as interest expense and related interest income associated with inter-company notes which are eliminated in the consolidated financial statements.

Income Taxes

Income taxes differ from the amounts computed by applying the federal income tax rate of 35.0%. A reconciliation of this difference is as follows:

	2009			2008			2007
	(in thousands)
Taxes calculated at federal rate	$	148,327		$	15,474		$	53,222
State taxes, net of federal benefit		14,292			13,792			12,635
Foreign taxes in excess of (less than) federal rate		12,967			(450	)		(2,077	)
Exclusion of certain meals and entertainment expenses		3,162			4,494			5,981
Goodwill impairment		—			6,778			—
Dividends received deduction		(2,056	)		(1,846	)		(1,288	)
Change in liability for income taxes associated with uncertain tax positions		(8,206	)		(9,961	)		8,892
Tax effect of noncontrolling interests		(17,875	)		(13,446	)		(23,230	)
Other items, net		4,010			1,011			(10,446	)
	$	154,621		$	15,846		$	43,689

The Company’s effective income tax rate (income tax expense as a percentage of income before income taxes), was 36.5% for 2009, 35.8% for 2008 and 28.7% for 2007. The effective income tax rate includes a provision for state income and franchise taxes for noninsurance subsidiaries. The absolute differences in the effective tax rates for 2009 and 2008 were primarily due to changes in the ratio of permanent differences to income before income taxes and changes in state income and franchise taxes resulting from fluctuations in the Company’s noninsurance subsidiaries’ contribution to pretax profits. In addition, certain interest and penalties relating to uncertain tax positions were released during the year based on changes in facts and circumstances

53

associated with the related tax uncertainty. The changes in the liability for income taxes associated with uncertain tax positions in 2009 and 2008 relate primarily to statutes of limitation closures and a foreign transfer pricing matter impacted by recent administrative and judicial developments, respectively. The Company continues to monitor the realizability of recognized, impairment and unrecognized losses recorded through December 31, 2009. The Company believes it is more likely than not that the tax benefits associated with those losses will be realized. However, this determination is a judgment and could be impacted by further market fluctuations. A large portion of the Company’s income attributed to noncontrolling interests is related to a limited liability company subsidiary, which for tax purposes, is treated as a partnership. Accordingly, no income taxes have been provided for that portion of the income attributable to noncontrolling interests.

Net income and net income (loss) attributable to the Company

Net income (loss) and per share information are summarized as follows (see Note 15 Earnings (Loss) Per Share to the consolidated financial statements):

	2009		2008			2007
	(in thousands, except per share amounts)
Net income	$	269,176	$	28,365		$	108,374
Less: Net income attributable to noncontrolling interests		69,525		54,685			111,493
Net income (loss) attributable to the Company	$	199,651	$	(26,320	)	$	(3,119	)
Per share of common stock:
Net income (loss) attributable to the Company:
Basic	$	2.11	$	(0.28	)	$	(0.03	)
Diluted	$	2.09	$	(0.28	)	$	(0.03	)
Weighted-average shares:
Basic		94,551		92,516			94,649
Diluted		95,478		92,516			94,649

Net income attributable to noncontrolling interests increased $14.8 million in 2009 over 2008 and decreased $56.8 million in 2008 from 2007. Net income attributable to noncontrolling interests typically fluctuates proportionately with the relative changes in the profits of FARES, which includes certain companies in the Company’s information and outsourcing solutions, data and analytic solutions and risk mitigation and business solutions segments.

Liquidity and Capital Resources

Cash provided by operating activities amounted to $487.8 million, $76.8 million and $659.6 million for 2009, 2008, and 2007, respectively, after net claim payments of $497.8 million, $502.1 million, and $487.7 million, respectively. The principal nonoperating uses of cash and cash equivalents for the three years ended December 31, 2009 were for acquisitions (including the acquisition of noncontrolling interests), additions to the investment portfolio, capital expenditures, dividends, distributions to noncontrolling shareholders and the repayment of debt. The most significant nonoperating sources of cash and cash equivalents were proceeds from draws on the Company’s credit facility and proceeds from the sales and maturities of certain marketable and other long-term investments. The net effect of all activities on total cash and cash equivalents was an increase of $47.5 million for 2009 and decreases of $227.6 million and $242.3 million for 2008 and 2007, respectively.

Notes and contracts payable, as a percentage of total capitalization (FAC stockholders’ equity, noncontrolling interests and redeemable noncontrolling interests), was 19.7% as of December 31, 2009, as compared with 22.2% as of the prior year end. This decrease was primarily attributable to the decrease in debt

54

levels during the year and the increase in equity due to profitability and issuance of shares for the purchase of noncontrolling interests. Notes and contracts payable are more fully described in Note 11 Notes and Contracts Payable to the consolidated financial statements.

In November 2005, the Company amended its $500.0 million credit agreement that was originally entered into in August 2004. The November 2005 amendment extended the expiration date to November 2010 and permitted the Company to increase the credit amount to $750.0 million under certain circumstances. In July 2007, the credit agreement was further amended to extend the expiration date to July 2012. In November 2009, the credit agreement was again amended to allow for the acquisition of the remaining noncontrolling interest in First Advantage. Under the credit agreement the Company is required to maintain certain minimum levels of capital and earnings and meet predetermined debt-to-capitalization ratios. The line of credit had a balance due of $340.0 million at December 31, 2009. At December 31, 2009, the Company is in compliance with the debt covenants under the amended and restated credit agreement.

First Advantage had one bank credit agreement which was terminated upon consummation of the buy-in transaction in the fourth quarter of 2009. This agreement provided for a $225.0 million revolving line of credit and was collateralized by the stock and accounts receivable of First Advantage’s subsidiaries. The line of credit was to remain in effect until September 2010. Under the terms of the credit agreement, First Advantage was required to satisfy certain financial requirements. At December 31, 2008, First Advantage was in compliance with the financial covenants of its loan agreement except for the consolidated to fixed charge coverage ratio for the quarter ended December 31, 2008. Compliance with this covenant was waived by the required lenders.

In December 2007, First American CoreLogic entered into a $100.0 million secured financing arrangement with Banc of America Leasing & Capital, LLC. Borrowings under the arrangement are secured by the capitalized software and data of First American CoreLogic and are guaranteed by FARES. The outstanding balance at December 31, 2009 totaled $64.2 million.

As of December 31, 2009, the Company’s debt and equity investment securities portfolio consists of approximately 96% of fixed income securities. As of that date, over 83% of the Company’s fixed income investments are held in securities that are United States government-backed or rated AAA, and approximately 95% of the fixed income portfolio is rated or classified as investment grade. Percentages are based on the amortized cost basis of the securities. Credit ratings are based on Standard & Poor’s (“S&P”) and Moody’s published ratings. If a security was rated differently by both rating agencies, the lower of the two ratings was selected.

The table below outlines the composition of the investment portfolio currently in an unrealized loss position by credit rating (percentages are based on the amortized cost basis of the investments). Credit ratings are based on S&P and Moody’s published ratings and are exclusive of insurance effects. If a security was rated differently by both rating agencies, the lower of the two ratings was selected:

	A-Ratings or Higher		BBB+ to BBB- Ratings		Non- Investment Grade
December 31, 2009
U.S. Treasury bonds	100.0	%	0.0	%	0.0	%
Municipal bonds	99.2	%	0.8	%	0.0	%
Foreign bonds	100.0	%	0.0	%	0.0	%
Governmental agency bonds	100.0	%	0.0	%	0.0	%
Governmental agency mortgage-backed and asset-backed securities	100.0	%	0.0	%	0.0	%
Non-agency mortgage-backed and asset-backed securities	11.3	%	7.5	%	81.2	%
Corporate debt securities	90.1	%	4.9	%	5.0	%
Preferred stock	0.0	%	8.1	%	91.9	%
	92.7	%	0.9	%	6.4	%

55

Approximately 35% of the Company’s municipal bonds portfolio has third party insurance in effect.

The table below summarizes the composition of the Company’s non-agency mortgage-backed and asset-backed securities by collateral type, year of issuance and credit ratings. Percentages are based on the amortized cost basis of the securities. Credit ratings are based on S&P and Moody’s published ratings. If a security was rated differently by both rating agencies, the lower of the two ratings was selected.

(in thousands, except percentages and number of securities)	Amortized Cost		Estimated Fair Value		Number of Securities	A-Ratings or Higher		BBB+ to BBB- Ratings		Non- Investment Grade
Non-agency mortgage-backed securities:
Prime single family residential:
2007	$	7,615	$	2,558	1	0.0	%	0.0	%	100.0	%
2006		44,789		25,458	11	0.0	%	0.5	%	99.5	%
2005		13,967		10,292	9	37.2	%	49.5	%	13.3	%
2003		941		853	4	100.0	%	0.0	%	0.0	%
Alt-A single family residential:
2007		25,483		18,509	2	0.0	%	0.0	%	100.0	%
Non-agency asset-backed securities		4,600		3,754	5	100.0	%	0.0	%	0.0	%
	$	97,395	$	61,424	32	11.0	%	7.3	%	81.7	%

As of December 31, 2009, eleven non-agency mortgage-backed and asset-backed securities with an amortized cost of $30.8 million and an estimated fair value of $19.9 million were on negative credit watch by S&P or Moody’s.

The Company assessed its non-agency mortgage-backed and asset-backed securities portfolio to determine what portion of the portfolio, if any, is other-than-temporarily impaired at December 31, 2009. Management’s analysis of the portfolio included its expectations of the future performance of the underlying collateral, including, but not limited to, prepayments, defaults, and loss severity assumptions. In developing these expectations, the Company utilized publicly available information related to individual assets, analysts’ expectations on the expected performance of similar underlying collateral and certain of the Company’s securities data and market analytic tools. Based on this analysis, the Company recognized total other-than-temporary impairments of $50.6 million associated with non-agency mortgage-backed and asset-backed securities for the year ended December 31, 2009. $19.7 million of other-than-temporary impairments were considered to be credit related, which is the difference between the present value of the cash flows expected to be collected and the amortized cost basis, and were recognized in earnings for the year ended December 31, 2009 and the remaining $30.9 million of other-than-temporary impairment losses were considered to be related to factors other than credit and were recognized in accumulated other comprehensive loss for the year ended December 31, 2009.

In addition to its debt and equity investment securities portfolio, the Company maintains certain money-market and other short-term investments.

Due to the Company’s liquid-asset position and its ability to generate cash flows from operations, management believes that its resources are sufficient to satisfy its anticipated operational cash requirements and the obligations and cash requirements of its holding company for at least the next twelve months. Prior to the spin-off transaction, the Company expects to continue its policy of paying regular quarterly cash dividends. Following the consummation of the spin-off transaction, the financial services company is expected to pay approximately $24.0 million per year in dividends to holders of its common stock. However, the amount of the dividend, if any, depends on the earnings, financial condition and capital requirements of the financial services company at that time. The information solutions company is not expected to pay a dividend following the transaction.

Off-balance sheet arrangements and contractual obligations.    The Company administers escrow deposits and trust assets as a service to its customers. Escrow deposits totaled $2.9 billion and $3.8 billion at

56

December 31, 2009 and 2008, respectively, of which $0.9 billion and $1.04 billion, respectively, were held at the Company’s federal savings bank subsidiary, First American Trust, FSB. The escrow deposits held at First American Trust, FSB, are included in the accompanying consolidated balance sheets, with $794.3 million and $909.3 million included in debt and equity securities at December 31, 2009, and 2008, respectively, and $70.6 million and $135.2 million included in cash and cash equivalents at December 31, 2009 and 2008, respectively, with offsetting liabilities included in demand deposits. The remaining escrow deposits were held at third-party financial institutions.

Trust assets totaled $2.9 billion and $3.4 billion at December 31, 2009 and 2008, respectively, and were held at First American Trust, FSB. Escrow deposits held at third-party financial institutions and trust assets are not considered assets of the Company and, therefore, are not included in the accompanying consolidated balance sheets. However, the Company could be held contingently liable for the disposition of these assets.

In conducting its operations, the Company often holds customers’ assets in escrow, pending completion of real estate transactions. As a result of holding these customers’ assets in escrow, the Company has ongoing programs for realizing economic benefits, including investment programs, borrowing agreements, and vendor services arrangements with various financial institutions. The effects of these programs are included in the consolidated financial statements as income or a reduction in expense, as appropriate, based on the nature of the arrangement and benefit earned.

The Company facilitates tax-deferred property exchanges for customers pursuant to Section 1031 of the Internal Revenue Code and tax-deferred reverse exchanges pursuant to Revenue Procedure 2000-37. As a facilitator and intermediary, the Company holds the proceeds from sales transactions and takes temporary title to property identified by the customer to be acquired with such proceeds. Upon the completion of such exchange, the identified property is transferred to the customer or, if the exchange does not take place, an amount equal to the sales proceeds or, in the case of a reverse exchange, title to the property held by the Company is transferred to the customer. Like-kind exchange funds held by the Company for the purpose of completing such transactions totaled $385.0 million and $553.1 million at December 31, 2009 and 2008, respectively, of which $186.1 million and $173.9 million at December 31, 2009 and 2008, respectively, were held at the First Security Business Bank (“FSBB”). The like-kind exchange deposits held at FSBB are included in the accompanying consolidated balance sheets, in cash and cash equivalents with offsetting liabilities included in demand deposits. The remaining exchange deposits were held at third-party financial institutions and, due to the structure utilized to facilitate these transactions, the proceeds and property are not considered assets of the Company under U.S. generally accepted accounting principles (“GAAP”) and, therefore, are not included in the accompanying consolidated balance sheets. All such amounts are placed in bank deposits with FDIC insured institutions. The Company could be held contingently liable to the customer for the transfers of property, disbursements of proceeds and the return on the proceeds.

A summary, by due date, of the Company’s total contractual obligations at December 31, 2009, is as follows:

	Notes and contracts payable		Interest on notes and contracts payable		Operating leases		Claim losses		Deferrable interest subordinated notes		Total
	(in thousands)
2010	$	73,052	$	38,950	$	153,512	$	346,821	$	—	$	612,335
2011		43,146		35,389		115,701		195,279		—		389,515
2012		372,140		22,548		81,778		149,600		100,000		726,066
2013		5,900		18,610		56,702		113,577		—		194,789
2014		161,672		13,941		37,857		84,724		—		298,194
Later years		135,173		124,485		65,169		365,087		—		689,914
	$	791,083	$	253,923	$	510,719	$	1,255,088	$	100,000	$	2,910,813

57

The timing of claim payments is estimated and are not set contractually. Nonetheless, based on historical claims experience, the Company anticipates the above payment patterns. Changes in future claim settlement patterns, judicial decisions, legislation, economic conditions and other factors could affect the timing and amount of actual claim payments. The Company is not able to reasonably estimate the timing of payments, or the amount by which the liability for its uncertain tax positions will increase or decrease over time; therefore the liability of $21.4 million has not been included in the contractual obligations table (see Note 14 Income Taxes to the consolidated financial statements).

Pursuant to various insurance and other regulations, the maximum amount of dividends, loans and advances available to the Company in 2010 from its insurance subsidiaries is $258.0 million. Such restrictions have not had, nor are they expected to have, an impact on the Company’s ability to meet its cash obligations. See Note 3 Statutory Restrictions on Investments and Stockholders’ Equity to the consolidated financial statements.

On May 18, 2004, the Company announced that its Board of Directors adopted a plan authorizing the repurchase of $100 million of its common shares. On May 19, 2005, the Company announced an amendment to this plan increasing the amount of shares that the Company may repurchase to $200 million. On June 26, 2006, the Company announced a further amendment to this plan, increasing the amount of shares that may be repurchased to $500 million. On January 15, 2008, the Board of Directors authorized an additional $300 million of repurchase capacity. Under this plan, which has no expiration date, the Company may repurchase up to $800 million of the Company’s issued and outstanding Common shares. Between inception of the plan and December 31, 2007, the Company had repurchased and retired 10.5 million of its common shares for a total purchase price of $439.6 million and has the authority to repurchase an additional $360.4 million. The Company did not repurchase any shares in 2009 and 2008.

58

Item 7A.    Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

The Company has exposure to market risk related to interest rate risk associated with certain financial instruments. The Company monitors its risk associated with fluctuations in interest rates and makes investment decisions to manage the perceived risk. However, it does not currently use derivative financial instruments in any material amount to hedge these risks. The table below provides information about certain assets and liabilities that are sensitive to changes in interest rates and presents cash flows and the related weighted average interest rates by expected maturity dates.

	2010			2011		2012			2013		2014		Thereafter		Total		Fair Value
	(in thousands except percentages)
Assets
Deposits with Savings and Loans
Book Value	$	124,553													$	124,553	$	124,553
Average Interest Rate		1.39	%															100.0	%
Debt Securities
Book Value	$	105,022		59,116			149,016		127,645		134,523		1,315,024		$	1,890,346	$	1,868,413
Average Interest Rate		1.84	%	5.24	%		3.08	%	3.07	%	3.52	%	2.81	%				98.8	%
Loans Receivable
Book Value	$	43		3,111			3,221		2,260		2,808		153,385		$	164,828	$	165,130
Average Interest Rate		3.00	%	7.35	%		7.52	%	6.95	%	6.26	%	6.67	%				100.2	%
Liabilities
Interest Bearing Escrow Deposits
Book Value	$	670,308													$	670,308	$	670,308
Average Interest Rate		0.61	%															100.0	%
Variable Rate Demand Deposits
Book Value	$	215,031													$	215,031	$	215,031
Average Interest Rate		0.33	%															100.0	%
Fixed Rate Demand Deposits
Book Value	$	27,829		9,896			5,238		616		2,035				$	45,614	$	46,249
Average Interest Rate		3.10	%	3.10	%		4.05	%	3.92	%	3.17	%						101.4	%
Notes and Contracts Payable
Book Value	$	73,052		43,146			372,140		5,900		161,672		135,173		$	791,083	$	747,711
Average Interest Rate		4.54	%	4.47	%		3.75	%	6.17	%	6.19	%	7.13	%				94.5	%
Deferrable Interest Subordinates Notes
Book Value						$	100,000								$	100,000	$	108,992
Average Interest Rate							8.50	%										109.0	%

Equity Price Risk

The Company is also subject to equity price risk related to its equity securities portfolio. At December 31, 2009, the Company had equity securities with a cost of $75.6 million and fair value of $99.2 million. The Company currently manages the equity price risk through the investment committee process.

Foreign Currency Risk

Although the Company has exchange rate risk for its operations in certain foreign countries, these operations, in the aggregate, are not material to the Company’s financial condition or results of operations. The Company does not hedge any of its foreign exchange risk.

59

Credit Risk

The Company’s corporate, municipal, foreign, non-agency mortgage-backed and asset-backed and, to a lesser extent, its agency securities are subject to credit risk. The Company manages its credit risk through diversification and concentration limits by asset type as established by its investment committee.

The Company’s non-agency mortgage-backed and asset-backed securities credit risk is analyzed by monitoring servicer reports and through utilization of sophisticated cash flow models to measure the underlying collateral pools. The Company performed a sensitivity analysis on the estimated investment losses on its non-agency mortgage-backed and asset-backed securities portfolio assuming a hypothetical 20% increase in credit losses on the underlying pools of mortgages or other assets. At December 31, 2009, such an increase in credit losses would result in an approximate decline in cash flows on the non-agency portfolio of 3.7%. Actual results could vary from the estimated results of the sensitivity analysis.

The Company holds a large concentration in US government agency securities, including agency mortgage-backed securities. In the event of discontinued US government support of its agencies, material credit risk could be observed in the portfolio. The Company views that scenario unlikely but possible.

The Company’s overall investment securities portfolio maintains an average credit quality of AA.

Item 8.    Financial Statements and Supplementary Data

Separate financial statements for subsidiaries not consolidated and 50% or less owned persons accounted for by the equity method have been omitted either because they would not constitute a significant subsidiary or, as it relates to the 2008 financial statements, because the Company has received a waiver from the Securities and Exchange Commission with respect thereto.

60

INDEX

	Page No.
Report of Independent Registered Public Accounting Firm	62
Financial Statements:
Consolidated Balance Sheets	63
Consolidated Statements of Income	64
Consolidated Statements of Comprehensive Income	65
Consolidated Statements of Equity	66
Consolidated Statements of Cash Flows	67
Notes to Consolidated Financial Statements	68
Unaudited Quarterly Financial Data	120
Financial Statement Schedules:
I.          Summary of Investments—Other than Investments in Related Parties	121
III.      Supplementary Insurance Information	122
IV.      Reinsurance	124
V.       Valuation and Qualifying Accounts	125

Financial statement schedules not listed are either omitted because they are not applicable or the required information is shown in the consolidated financial statements or in the notes thereto.

61

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of

The First American Corporation:

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of The First American Corporation and its subsidiaries at December 31, 2009 and 2008, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2009 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedules listed in the accompanying index present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2009, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for these financial statements and financial statement schedules, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express opinions on these financial statements, on the financial statement schedules, and on the Company’s internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

As discussed in Note 1 to the consolidated financial statements, the Company changed the manner in which it accounts for noncontrolling interests and other-than-temporary impairments of debt securities in 2009.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/S/ PRICEWATERHOUSECOOPERS LLP

PricewaterhouseCoopers LLP

Orange County, California

March 1, 2010

62

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except par value)

	December 31
	2009			2008
ASSETS
Cash and cash equivalents	$	982,448		$	934,945
Accounts and accrued income receivable, less allowances ($66,724 and $71,871)		491,539			558,946
Income taxes receivable		97,989			61,678
Investments:
Deposits with savings and loan associations and banks		124,553			182,117
Debt securities		1,868,413			1,718,320
Equity securities		99,167			110,126
Other long-term investments		374,862			371,157
		2,466,995			2,381,720
Loans receivable, net		161,897			151,692
Property and equipment, net		591,782			665,305
Title plants and other indexes		692,359			685,090
Deferred income taxes		13,255			149,473
Goodwill		2,617,577			2,594,738
Other intangible assets, net		257,526			298,411
Other assets		349,730			326,072
	$	8,723,097		$	8,808,070
LIABILITIES AND EQUITY
Demand deposits	$	1,153,574		$	1,298,221
Accounts payable and accrued liabilities:
Accounts payable		109,653			119,234
Salaries and other personnel costs		216,277			197,335
Pension costs and other retirement plans		478,587			434,641
Other		280,514			320,898
		1,085,031			1,072,108
Deferred revenue		710,217			728,844
Reserve for known and incurred but not reported claims		1,255,088			1,355,392
Notes and contracts payable		791,083			868,274
Deferrable interest subordinated notes		100,000			100,000
Total liabilities		5,094,993			5,422,839
Commitments and contingencies
Redeemable noncontrolling interests		458,847			—
The First American Corporation (“FAC”) stockholders’ equity:
Preferred stock, $1 par value
Authorized—500 shares; Outstanding—None
Common stock, $1 par value
Authorized—180,000 shares; Outstanding—103,283 and 92,963 shares		103,283			92,963
Additional paid-in capital		1,001,305			801,228
Retained earnings		2,217,505			2,099,654
Accumulated other comprehensive loss		(167,798	)		(296,195	)
Total FAC stockholders’ equity		3,154,295			2,697,650
Noncontrolling interests		14,962			687,581
Total equity		3,169,257			3,385,231
	$	8,723,097		$	8,808,070

See Notes to Consolidated Financial Statements

63

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)

	Year Ended December 31
	2009			2008			2007
Revenues:
Operating revenues	$	5,791,304		$	6,080,648		$	7,827,219
Investment and other income		211,566			232,281			320,070
Gain on stock issued by subsidiary		—			1,325			9,426
Net realized investment gains (losses)		11,644			(64,325	)		65,668
Net other-than-temporary impairment (“OTTI”) losses recognized in earnings:
Total OTTI losses on equity securities		(21,992	)		(35,412	)		—
Total OTTI losses on debt securities		(50,639	)		(759	)		—
Portion of OTTI losses on debt securities recognized in other comprehensive loss		30,894			—			—
		(41,737	)		(36,171	)		—
		5,972,777			6,213,758			8,222,383
Expenses:
Salaries and other personnel costs		1,888,066			2,100,756			2,603,551
Premiums retained by agents		1,237,566			1,374,452			2,111,798
Other operating expenses		1,726,728			1,780,580			2,072,733
Provision for title losses and other claims		383,452			533,324			893,945
Depreciation and amortization		219,922			262,945			232,339
Premium taxes		36,484			46,366			65,720
Interest		56,762			71,124			90,234
		5,548,980			6,169,547			8,070,320
Income before income taxes		423,797			44,211			152,063
Income taxes		154,621			15,846			43,689
Net income		269,176			28,365			108,374
Less: Net income attributable to noncontrolling interests		69,525			54,685			111,493
Net income (loss) attributable to FAC	$	199,651		$	(26,320	)	$	(3,119	)
Net income (loss) per share attributable to FAC stockholders:
Basic	$	2.11		$	(0.28	)	$	(0.03	)
Diluted	$	2.09		$	(0.28	)	$	(0.03	)
Weighted-average common shares outstanding:
Basic		94,551			92,516			94,649
Diluted		95,478			92,516			94,649

See Notes to Consolidated Financial Statements

64

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

	Year Ended December 31
	2009		2008			2007
Net income	$	269,176	$	28,365		$	108,374
Other comprehensive income (loss), net of tax:
Unrealized gain (loss) on securities		62,283		(113,885	)		42,600
Unrealized gain on securities for which credit-related portion was recognized in earnings		12,111		—			—
Foreign currency translation adjustment		36,886		(54,676	)		15,781
Pension benefit adjustment		21,016		(57,675	)		41,170
Total other comprehensive income (loss), net of tax		132,296		(226,236	)		99,551
Comprehensive income (loss)		401,472		(197,871	)		207,925
Less: Comprehensive income attributable to noncontrolling interests		73,424		39,484			121,148
Comprehensive income (loss) attributable to FAC	$	328,048	$	(237,355	)	$	86,777

See Notes to Consolidated Financial Statements

65

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF EQUITY

(in thousands)

	Shares		Common Stock			Additional paid-in capital			Retained earnings			Accumulated other comprehensive (loss) income			Non- controlling interests			Total
Balance at December 31, 2006	96,484		$	96,484		$	983,421		$	2,297,432		$	(175,056	)	$	511,821		$	3,714,102
Net loss for 2007	—			—			—			(3,119	)		—			111,493			108,374
Dividends on common shares	—			—			—			(82,833	)		—			—			(82,833	)
Purchase of Company shares	(6,648	)		(6,648	)		(299,304	)		—			—			—			(305,952	)
Shares issued in connection with company acquisitions	19			19			627			—			—			—			646
Shares issued in connection with restricted stock unit, option and benefit plans	1,975			1,975			59,211			—			—			—			61,186
Share-based compensation expense	—			—			18,679			—			—			—			18,679
Restricted stock unit dividend equivalents	—			—			100			(100	)		—			—			—
Dividends paid deduction	—			—			—			2,720			—			—			2,720
Adjustment to adopt accounting guidance for uncertain income tax positions	—			—			—			(8,106	)		—			—			(8,106	)
Sale of subsidiary shares to / other increases in noncontrolling interests	—			—			—			—			—			130,480			130,480
Purchase of subsidiary shares from / other decreases in noncontrolling interests	—			—			—			—			—			(24,176	)		(24,176	)
Contributions from noncontrolling interests	—			—			—			—			—			19,037			19,037
Distributions to noncontrolling interests	—			—			—			—			—			(72,976	)		(72,976	)
Other comprehensive income (Note 22)	—			—			—			—			89,896			9,655			99,551
Balance at December 31, 2007	91,830			91,830			762,734			2,205,994			(85,160	)		685,334			3,660,732
Net loss for 2008	—			—			—			(26,320	)		—			54,685			28,365
Dividends on common shares	—			—			—			(81,542	)		—			—			(81,542	)
Shares issued in connection with company acquisitions	125			125			3,463			—			—			—			3,588
Shares issued in connection with restricted stock unit, option and benefit plans	1,008			1,008			19,745			—			—			—			20,753
Share-based compensation expense	—			—			14,479			—			—			—			14,479
Restricted stock unit dividend equivalents	—			—			807			(807	)		—			—			—
Dividends paid deduction	—			—			—			2,329			—			—			2,329
Sale of subsidiary shares to / other increases in noncontrolling interests	—			—			—			—			—			30,006			30,006
Purchase of subsidiary shares from / other decreases in noncontrolling interests	—			—			—			—			—			(31,241	)		(31,241	)
Distributions to noncontrolling interests	—			—			—			—			—			(36,002	)		(36,002	)
Other comprehensive loss (Note 22)	—			—			—			—			(211,035	)		(15,201	)		(226,236	)
Balance at December 31, 2008	92,963			92,963			801,228			2,099,654			(296,195	)		687,581			3,385,231
Net income for 2009	—			—			—			199,651			—			69,525			269,176
Dividends on common shares	—			—			—			(84,349	)		—			—			(84,349	)
Shares issued in connection with company acquisitions(Note 24)	9,497			9,497			301,767			—			—			—			311,264
Shares issued in connection with restricted stock unit, option and benefit plans	823			823			11,778			—			—			—			12,601
Share-based compensation expense	—			—			24,067			—			—			—			24,067
Restricted stock unit dividend equivalents	—			—			1,146			(1,146	)		—			—			—
Dividends paid deduction	—			—			—			3,695			—			—			3,695
Reclassification to redeemable noncontrolling interests	—			—			—			—			—			(332,964	)		(332,964	)
Purchase of subsidiary shares from / other decreases in noncontrolling interests	—			—			(12,798	)		—			—			(384,523	)		(397,321	)
Sale of subsidiary shares to / other increases in noncontrolling interests	—			—			—			—			—			12,347			12,347
Distributions to noncontrolling interests	—			—			—			—			—			(40,903	)		(40,903	)
Adjust redeemable noncontrolling interests to redemption value	—			—			(125,883	)		—			—			—			(125,883	)
Other comprehensive income (Note 22)	—			—			—			—			128,397			3,899			132,296
Balance at December 31, 2009	103,283		$	103,283		$	1,001,305		$	2,217,505		$	(167,798	)	$	14,962		$	3,169,257

See Notes to Consolidated Financial Statements

66

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31
	2009			2008			2007
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	269,176		$	28,365		$	108,374
Adjustments to reconcile net income to cash provided by operating activities:
Provision for title losses and other claims		383,452			533,324			893,945
Depreciation and amortization		219,922			262,945			232,339
Net realized investment (gains) losses		(11,644	)		64,325			(65,668	)
Net OTTI losses recognized in earnings		41,737			36,171			—
Gain on stock issued by subsidiary		—			(1,325	)		(9,426	)
Share-based compensation expense		40,866			25,026			43,407
Equity in earnings of affiliates		(91,389	)		(44,762	)		(47,708	)
Changes in assets and liabilities excluding effects of company acquisitions and noncash transactions:
Claims paid, including assets acquired, net of recoveries		(497,779	)		(502,098	)		(487,665	)
Net change in income tax accounts		79,666			(65,094	)		(95,479	)
Decrease (increase) in accounts and accrued income receivable		73,121			(2,056	)		12,455
Increase (decrease) in accounts payable and accrued liabilities		34,053			(175,950	)		32,308
Decrease in deferred revenue		(18,627	)		(27,359	)		(8,082	)
Other, net		(34,752	)		(54,745	)		50,809
Cash provided by operating activities		487,802			76,767			659,609
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash effect of company acquisitions/dispositions		(51,546	)		(125,855	)		(345,847	)
Purchase of subsidiary shares from / other decreases in noncontrolling interests		(53,439	)		(31,241	)		(24,176	)
Sale of subsidiary shares to / other increases in noncontrolling interests		12,347			30,006			130,480
Increase in deposits with banks		(20,146,612	)		(18,312,457	)		(10,255,327	)
Decrease in deposits with banks		20,211,637			18,329,075			10,169,147
Purchases of debt and equity securities		(953,259	)		(913,382	)		(672,264	)
Proceeds from sales of debt and equity securities		427,407			200,507			176,047
Proceeds from maturities of debt securities		491,493			198,084			289,378
Dividends from equity method investments		93,483			69,361			60,405
Net (increase) decrease in other long-term investments		(10,310	)		17,727			195,600
Origination and purchases of loans and participations		(23,729	)		(45,096	)		(37,066	)
Decrease in loans receivable after originations and others		13,524			10,155			21,956
Capital expenditures		(88,408	)		(145,304	)		(229,108	)
Purchases of capitalized data		(28,904	)		(32,239	)		(25,319	)
Proceeds from sale of property and equipment		14,833			23,626			57,699
Cash used for investing activities		(91,483	)		(727,033	)		(488,395	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in demand deposits		(144,651	)		554,536			(62,641	)
Proceeds from issuance of debt		58,960			300,253			497,016
Repayment of debt		(154,598	)		(336,920	)		(465,881	)
Purchase of Company shares		—			—			(305,952	)
Proceeds from exercise of stock options		8,787			14,357			42,189
Proceeds from issuance of stock to employee benefit plans		4,875			6,394			8,568
Contributions from noncontrolling interests		—			—			19,037
Distributions to noncontrolling interests		(40,903	)		(36,002	)		(72,976	)
Excess tax benefits from share-based compensation		768			1,315			7,103
Cash dividends		(82,054	)		(81,291	)		(79,992	)
Cash (used for) provided by financing activities		(348,816	)		422,642			(413,529	)
Net increase (decrease) in cash and cash equivalents		47,503			(227,624	)		(242,315	)
Cash and cash equivalents—Beginning of year		934,945			1,162,569			1,404,884
Cash and cash equivalents—End of year	$	982,448		$	934,945		$	1,162,569
SUPPLEMENTAL INFORMATION:
Cash paid during the year for:
Interest	$	58,937		$	73,732		$	65,419
Premium taxes	$	33,713		$	56,717		$	67,524
Income taxes, net	$	79,470		$	86,341		$	150,139
Noncash operating, investing and financing activities:
Company acquisitions in exchange for common stock	$	311,264		$	3,588		$	647
Liabilities assumed in connection with company acquisitions	$	6,260		$	5,445		$	146,955
Impact of adoption of accounting guidance for uncertain income tax positions	$	—		$	—		$	78,734
Exchange of net assets for interest in unconsolidated affiliate	$	—		$	—		$	39,193
Assets under capital lease obligation	$	8,178		$	—		$	—

See Notes to Consolidated Financial Statements

67

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1.    Description of the Company:

The First American Corporation, through its subsidiaries, is engaged in the business of providing business information and related products and services. The Company has five reporting segments that fall within two primary business groups, financial services and information solutions. The financial services group includes the Company’s title insurance and services segment and its specialty insurance segment. The title insurance and services segment provides title insurance, escrow or closing services and similar or related financial services domestically and internationally in connection with residential and commercial real estate transactions. It also provides thrift, trust and investment advisory services. Beginning on January 1, 2010, this segment is also in the business of maintaining, managing and providing access to automated title plant records and images that may be owned by the Company or other parties, which was previously carried on by the data and analytic solutions segment. The specialty insurance segment issues property and casualty insurance policies and sells home warranty products. The Company’s information and outsourcing solutions, data and analytic solutions and risk mitigation and business solutions segments comprise its information solutions group. The information and outsourcing solutions segment focuses on providing a wide-range of products and services including tax monitoring, flood zone certification and monitoring, building and maintaining geospatial proprietary software and databases, default management services, loan administration and production services, business process outsourcing and asset valuation and management services. The data and analytic solutions segment provides licenses and analyzes data relating to mortgage securities and loans and real property, offers risk management and collateral assessment analytics and provides database access tools and automated appraisal services. The risk mitigation and business solutions segment, which is comprised entirely of the Company’s wholly-owned subsidiary, First Advantage Corporate (“First Advantage”) provides credit reporting solutions for mortgage and home equity needs, consumer credit reporting services, consumer credit reporting for the automotive dealer marketplace, automotive lead generation services, transportation credit reporting, motor vehicle record reporting, fleet management, criminal records reselling, specialty finance credit reporting, lead generation services, employment background screening, occupational health services, tax incentive services, hiring solutions, resident screening, software services and investigative services.

Significant Accounting Policies:

Principles of consolidation

The consolidated financial statements include the accounts of The First American Corporation and all controlled subsidiaries. All significant intercompany transactions and balances have been eliminated. Investments in which the Company exercises significant influence, but does not control and is not the primary beneficiary, are accounted for using the equity method. Investments in which the Company does not exercise significant influence over the investee are accounted for under the cost method.

Reclassification and out of period adjustments

Certain 2007 and 2008 amounts have been reclassified to conform to the 2009 presentation.

Net income for the year ended December 31, 2009 includes income of $7.1 million related to certain items that should have been recorded in a prior year. These items increased diluted net income per share attributable to FAC stockholders by $0.05 for the year.

Use of estimates

The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the statements. Actual results could differ from the estimates and assumptions used.

68

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Cash and cash equivalents

The Company considers cash equivalents to be all short-term investments that have an initial maturity of 90 days or less and are not restricted for statutory deposit or premium reserve requirements.

Investments

Deposits with savings and loan associations and banks are short-term investments with initial maturities of more than 90 days.

Debt securities are carried at fair value and consist primarily of investments in obligations of the United States Treasury, various corporations, certain state and political subdivisions and mortgage-backed securities.

Equity securities are carried at fair value and consist primarily of investments in marketable common stocks of corporate entities.

The Company classifies its publicly traded debt and equity securities as available-for-sale and carries them at fair value with unrealized gains or losses classified as a component of accumulated other comprehensive loss.

The Company determines the fair value of its debt and equity securities using a three-level hierarchy for fair value measurements that distinguishes between market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs) and the reporting entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The hierarchy level assigned to each security in the Company’s available-for-sale portfolio is based on management’s assessment of the transparency and reliability of the inputs used in the valuation of such instrument at the measurement date. The three hierarchy levels are defined as follows:

Level 1—Valuations based on unadjusted quoted market prices in active markets for identical securities. The fair value of equity securities included in the Level 1 category was based on quoted prices that are readily and regularly available in an active market.

Level 2—Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. The fair value of fixed maturity and short-term investments included in the Level 2 category was based on the market values obtained from an independent pricing service that were evaluated using pricing models that vary by asset class and incorporate available trade, bid and other market information and price quotes from well-established independent broker-dealers. This pricing service, which is a provider of financial market data, analytics and related services to financial institutions, provides the Company one price for each security. The independent pricing service monitors market indicators, industry and economic events, and for broker-quoted only securities, obtains quotes from market makers or broker-dealers that it recognizes to be market participants. The Level 2 category includes foreign bonds, governmental agency bonds, governmental agency mortgage-backed and asset-backed securities and corporate debt securities, many of which are actively traded and have market prices that are readily verifiable. Level 2 also includes non-agency mortgage-backed and asset-backed securities and municipal bonds which are currently not actively traded securities. When the value from an independent pricing service is utilized, the Company obtains an understanding of the valuation models and assumptions utilized by the service and has controls in place to determine that the values provided represent current values. Typical inputs and assumptions to pricing models used to value securities include, but are not

69

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

limited to, benchmark yields, reported trades, broker-dealer quotes, issue spreads, benchmark securities, bids, offers, reference data and industry and economic events. For mortgage-backed and asset-backed securities, inputs and assumptions may also include the structure of issuance, characteristics of the issuer, collateral attributes, prepayment speeds and credit ratings. The Company’s non-agency mortgage-backed and asset-backed securities consist of senior tranches of securitizations and the underlying borrowers are substantially all prime. The Company’s validation procedures include assessing the reasonableness of the changes relative to prior periods given the prevailing market conditions, comparison of the prices received from the pricing service to quotes received from other third party sources for securities with market prices that are readily verifiable, changes in the issuers’ credit worthiness, performance of any underlying collateral and prices of the instrument relative to similar issuances. To date, the Company has not made any adjustments to the results provided by the pricing service.

Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement, and involve management judgment.

If the inputs used to measure fair value fall in different levels of the fair value hierarchy, a financial security’s hierarchy level is based upon the lowest level of input that is significant to the fair value measurement. A number of the Company’s investment grade corporate bonds are frequently traded in active markets and market prices for these securities existed at December 31, 2009. These securities were classified as Level 2 at December 31, 2009 because the valuation models use observable market inputs in addition to traded prices.

In the first quarter of 2009, the Company adopted newly issued accounting guidance that establishes a new method of recognizing and reporting other-than-temporary impairment of debt securities. The Company assesses the unrealized losses in its debt security portfolio under this guidance, primarily the non-agency mortgage-backed and asset-backed securities. If the Company determines it does not expect to recover the amortized cost basis of a debt security with declines in fair value (even if it does not intend to sell or it is not more likely than not that it will be required to sell the debt security before the recovery of the debt security’s remaining amortized cost basis), the credit portion of the other-than-temporary impairment loss is recognized in earnings and the non-credit portion, if any, is recognized in other comprehensive income. The credit portion of the other-than-temporary impairment loss is the difference between the present value of the cash flows expected to be collected and the amortized cost basis of the debt security. Expected future cash flows are based on qualitative and quantitative factors, including the probability of default and the estimated timing and amount of recovery. For non-agency mortgage-backed and asset-backed securities, estimated future cash flows are based on the structure of the security and certain assumptions, such as the remaining payment terms of the security, prepayment speeds, default rates and loss severity on the collateral supporting the security. In developing the assumptions used in estimating the expected future cash flows, the Company utilized publicly available information related to individual assets, generally available market data such as forward interest rate curves and its securities data and market analytic tools. The expected future cash flows are discounted using the current accrual rate attributable to the security.

When, in the opinion of management, a decline in the fair value of an equity security (including common and preferred stock) and, prior to the first quarter of 2009, a debt security is considered to be other-than-temporary, such security is written down to its fair value. When assessing if a decline in value is other-than-temporary, the factors considered include the length of time and extent to which fair value has been below cost, the probability that the Company will be unable to collect all amounts due under the contractual terms of the security, the seniority and duration of the securities, issuer-specific news and other developments, the financial condition and prospects of the issuer (including credit ratings), macro-economic changes (including the outlook for industry sectors, which includes government policy initiatives) and the Company’s ability and intent to hold the investment for a period of time sufficient to allow for any anticipated recovery.

70

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

When an equity security has been in an unrealized loss position for greater than twelve months, the Company’s review of the security includes the above noted factors as well as what evidence, if any, exists to support that the security will recover its value in the foreseeable future, typically within the next twelve months. If objective, substantial evidence does not indicate a likely recovery during that timeframe, the Company’s policy is that such losses are considered other-than-temporary and therefore an impairment loss is recorded.

Other long-term investments consist primarily of investments in affiliates, which are accounted for under the equity method of accounting or the cost method of accounting, and notes receivable and other investments, which are carried at the lower of cost or fair value less costs to sell. One of the Company’s equity method investments is a joint venture that provides products used in connection with loan originations, in which a subsidiary of the Company owns a 50.1% interest. Based on the terms and conditions of the joint venture agreement, the Company does not have control of or a majority voting interest in the joint venture. Accordingly, this investment is accounted for under the equity method. Summarized financial information for this investment (assuming a 100% ownership interest) is as follows:

	December 31
	2009		2008
	(in thousands)
Balance sheets
Total assets	$	62,141	$	67,042
Total liabilities	$	32,660	$	31,664

	December 31
	2009		2008		2007
	(in thousands)
Statements of operations
Net revenue	$	526,505	$	337,130	$	301,466
Income before income taxes	$	142,489	$	77,773	$	63,507
Net income	$	142,489	$	77,773	$	63,507

Property and equipment

Property and equipment includes computer software acquired or developed for internal use and for use with the Company’s products. Software development costs, which include capitalized interest costs and certain payroll-related costs of employees directly associated with developing software, in addition to incremental payments to third parties, are capitalized from the time technological feasibility is established until the software is ready for use.

Depreciation on buildings and on furniture and equipment is computed using the straight-line method over estimated useful lives of 25 to 40 years and 3 to 10 years, respectively. Capitalized software costs are amortized using the straight-line method over estimated useful lives of 3 to 10 years. Leasehold improvements are amortized over useful lives that are consistent with the lease term.

Title plants and other indexes

Title plants and other indexes include the Company’s title plants, flood zone databases and capitalized real estate data. Title plants and flood zone databases are carried at original cost, with the costs of daily maintenance (updating) charged to expense as incurred. Because properly maintained title plants and flood zone databases

71

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

have indefinite lives and do not diminish in value with the passage of time, no provision has been made for depreciation or amortization. The Company analyzes its title plant and other indexes for impairment on an annual basis. This analysis includes, but is not limited to, the effects of obsolescence, duplication, demand and other economic factors.

Capitalized real estate data, which is primarily used by the Company’s data and analytic solutions segment, is amortized using the straight-line method over estimated useful lives of 5 to 15 years. Amortization expense for the capitalized real estate data was $16.4 million, $15.2 million and $13.2 million for the years ended December 31, 2009, 2008 and 2007, respectively.

Title plants and other indexes consist of the following:

	December 31
	2009		2008
	(in thousands)
Title plants	$	484,674	$	488,212
Capitalized real estate data, net		154,769		143,962
Flood zone certification database		52,916		52,916
Title plants and other indexes	$	692,359	$	685,090

Assets acquired in connection with claim settlements

In connection with settlement of title insurance and other claims, the Company sometimes purchases mortgages, deeds of trust, real property or judgment liens. These assets, sometimes referred to as “salvage assets,” are carried at the lower of cost or fair value less costs to sell and are included in other assets in the Company’s consolidated balance sheets.

Goodwill

Goodwill is tested at least annually for impairment. The Company performs the goodwill impairment test in the fourth quarter using September 30 as the annual valuation date to test goodwill for impairment.

Management’s impairment testing process includes two steps. The first step (“Step 1”) compares the fair value of each reporting unit to its book value. The fair value of each reporting unit is determined by using discounted cash flow analysis and market approach valuations. If the fair value of the reporting unit exceeds its book value, the goodwill is not considered impaired and no additional analysis is required. However, if the book value is greater than the fair value, a second step (“Step 2”) must be completed to determine if the fair value of the goodwill exceeds the book value of the goodwill.

Step 2 involves calculating an implied fair value of goodwill for each reporting unit for which the first step indicated impairment. The implied fair value of goodwill is determined in a manner similar to the amount of goodwill calculated in a business combination, by measuring the excess of the estimated fair value of the reporting unit, as determined in the first step, over the aggregate estimated fair values of the individual assets, liabilities and identifiable intangibles as if the reporting unit was being acquired in a business combination. If the implied fair value of goodwill exceeds the carrying value of goodwill assigned to the reporting unit, there is no impairment. If the carrying value of goodwill assigned to a reporting unit exceeds the implied fair value of the goodwill, an impairment loss is recorded for the excess. An impairment loss cannot exceed the carrying value of goodwill assigned to a reporting unit, and the loss establishes a new basis in the goodwill. Subsequent reversal of goodwill impairment losses is not permitted.

72

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The valuation of goodwill requires assumptions and estimates of many critical factors including revenue growth, cash flows, market multiples and discount rates. Forecasts of future operations are based, in part, on operating results and management’s expectations as to future market conditions. These types of analyses contain uncertainties because they require management to make assumptions and to apply judgments to estimate industry economic factors and the profitability of future business strategies. However, if actual results are not consistent with the Company’s estimates and assumptions, the Company may be exposed to future impairment losses that could be material. Due to significant volatility in the current markets, the Company’s operations may be negatively impacted in the future to the extent that exposure to impairment charges may be required.

Other intangible assets

The Company’s intangible assets consist of covenants not to compete, customer lists, trademarks and licenses. Each of these intangible assets, excluding licenses, is amortized on a straight-line basis over their useful lives ranging from 2 to 20 years and is subject to impairment tests when there is an indication of a triggering event or abandonment. Licenses are an intangible asset with an indefinite life and are therefore not amortized but rather tested for impairment by comparing the fair value of the license with its carrying value at least annually and when an indicator of potential impairment has occurred.

Impairment of long-lived assets and loans receivable

Long-lived assets held and used include investments in affiliates, notes receivable, property and equipment, capitalized software, other intangible assets and the Company’s real estate investments. Management uses estimated future cash flows (undiscounted and excluding interest) to measure the recoverability of long-lived assets held and used whenever events or changes in circumstances indicate that the carrying value of an asset may not be fully recoverable. If the undiscounted cash flow analysis indicates a long-lived asset is not recoverable, the impairment loss recorded is the excess of the carrying amount of the asset over its fair value.

In addition, the Company carries long-lived assets held for sale at the lower of cost or market as of the date that certain criteria have been met. As of December 31, 2009 and 2008 no long-lived assets were classified as held for sale.

During 2009 the Company recognized $23.5 million of impairment losses on investment in affiliates, other long-term investments, internally developed software, fixed assets and other intangible assets including $4.3 million in the title insurance and services segment, $0.5 million at the specialty insurance segment, $5.4 million at the information and outsourcing solutions segment, $0.6 million at the data and analytics segment and $12.7 million at the corporate level. During 2008 the Company recorded impairments of long-lived assets of $9.6 million, consisting primarily of internally developed software of $7.3 million at the corporate level and $2.3 million within the data and analytic solutions segment. Additionally, during 2007 the Company recognized $56.1 million of impairment losses on investment in affiliates and other long-term investments including $13.7 million in the title insurance and services segment, $22.2 million in the data and analytic solutions segment and $20.2 million at the corporate level. 2007 marked the depth of the real estate crisis and many of the investments written off in whole or in part during 2007 were companies whose revenues, income or other prospects for success were largely determined by the overall amount of real estate activity or the amount of activity in the geographies where the specific company was operating. In making the determination as to whether an individual investment was other than temporarily impaired, the Company assessed the then-current and expected financial condition of each relevant entity, including, but not limited to, the anticipated ability of the entity to make its contractually required payments to the Company (with respect to debt obligations to the Company), the results of valuation work performed with respect to the entity, the entity’s anticipated ability to generate sufficient cash flows and the market conditions in the industry in which the entity was operating.

73

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

In 2007, the Company had a $75.0 million investment in non-voting convertible preferred stock of a diversified provider of real estate settlement and related services that was subject to redemption on September 30, 2007, but was not redeemed as of that date. Based on the terms of the security, the convertible preferred stock was expected to be converted into common stock of that entity in the fourth quarter of 2007 based upon its appraised value, as determined by three independent appraisal firms. That conversion did not occur and based on the estimated fair value, the Company recognized an impairment loss on the non-voting convertible preferred stock of $60.1 million in 2007. During 2008, the investee declared bankruptcy and the Company impaired the remaining $14.9 million investment in the preferred stock and an additional $22.4 million related to note and other receivables.

Loans receivable are impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. Impaired loans receivable are measured at the present value of expected future cash flows discounted at the loan’s effective interest rate. As a practical expedient, the loan may be valued based on its observable market price or the fair value of the collateral, if the loan is collateral-dependent. No indications of material impairment of loans receivable were identified during the three-year period ended December 31, 2009.

Reserve for known and incurred but not reported claims

The Company provides for title insurance losses by a charge to expense when the related premium revenue is recognized. The amount charged to expense is generally determined by applying a rate (the loss provision rate) to total title insurance operating revenues. The Company’s management estimates the loss provision rate at the beginning of each year and reassesses the rate quarterly to ensure that the resulting incurred but not reported (“IBNR”) loss reserve and known claims reserve included in the Company’s consolidated balance sheets together reflect management’s best estimate of the total costs required to settle all IBNR and known claims. If the ending IBNR reserve is not considered adequate, an adjustment is recorded.

The process of assessing the loss provision rate and the resulting IBNR reserve involves evaluation of the results of both an in-house actuarial review and independent actuarial analysis. The Company’s in-house actuary performs a reserve analysis utilizing generally accepted actuarial methods that incorporate cumulative historical claims experience and information provided by in-house claims and operations personnel. Current economic and business trends are also reviewed and used in the reserve analysis. These include real estate and mortgage markets conditions, changes in residential and commercial real estate values, and changes in the levels of defaults and foreclosures that may affect claims levels and patterns of emergence, as well as any company-specific factors that may be relevant to past and future claims experience. Results from the analysis include, but are not limited to, a range of IBNR reserve estimates and a single point estimate for IBNR as of the balance sheet date.

For recent policy years at early stages of development (generally the last three years), IBNR was determined by applying an expected loss rate to operating revenue and adjusting for policy year maturity using the estimated loss development pattern. The expected loss rate is based on historical experience and the relationship of the history to the applicable policy years. This is a generally accepted actuarial method of determining IBNR for policy years at early development ages, and when claims data reflects unusual impacts. IBNR calculated in this way differs from the IBNR a multiplicative loss development factor calculation would produce. Factor-based development effectively extrapolates results to date forward through the lifetime of the policy year’s development. Management believes the expected loss rate method is appropriate for recent policy years, because of the high level of loss emergence during the past three calendar years. This loss emergence is believed to consist largely of acceleration of claims that otherwise would have been realized later and one-time losses. Both of these effects are results of temporary economic conditions that are not expected to persist throughout the development lifetime of those policy years.

74

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

For more mature policy years (generally, policy years aged more than three years), IBNR was determined using multiplicative loss development factor calculations. These years were also exposed to adverse economic conditions during 2007-2009 that may have resulted in acceleration of claims and one-time losses. The possible extrapolation of these losses to future development periods by using factors was considered. The impact of economic conditions during 2007-2009 is believed to account for a much less significant portion of losses on policy years 2004 and prior than on more recent policy years. Policy years 2004 and prior were at relatively mature ages when the adverse development period began in 2007, and much of their losses had already been incurred by then. In addition, the loss development factors for policy years 2006 and prior are low enough that the potential for over-extrapolation is limited to an acceptable level.

The Company utilizes an independent third party actuary who produces a report with estimates and projections of the same financial items described above. The third party actuary’s analysis uses generally accepted actuarial methods that may in whole or in part be different from those used by the in-house actuary. The third party actuary’s report is a second estimate that is used to validate the reasonableness of the in-house analysis.

The Company’s management uses the point estimate of the projected IBNR from the in-house actuary’s analysis and other relevant information it may have concerning claims to determine what it considers to be the best estimate of the total amount required for the IBNR reserve.

Title insurance policies are long-duration contracts with the majority of the claims reported to the Company within the first few years following the issuance of the policy. Generally, 70 to 80 percent of claim amounts become known in the first five years of the policy life, and the majority of IBNR reserves relate to the five most recent policy years. A material change in expected ultimate losses and corresponding loss rates for policy years older than five years, while possible, is not considered reasonably likely by the Company. However, changes in expected ultimate losses and corresponding loss rates for recent policy years are considered likely and could result in a material adjustment to the IBNR reserves. Based on historical experience, the Company believes that a 50 basis point change to one or more of the loss rates for the most recent policy years, positive or negative, is reasonably likely given the long duration nature of a title insurance policy. If the expected ultimate losses for each of the last five policy years increased or decreased by 50 basis points, the resulting impact on the IBNR reserve would be an increase or decrease, as the case may be, of $123.3 million. The estimates made by management in determining the appropriate level of IBNR reserves could ultimately prove to be inaccurate and actual claims experience may vary from the expected claims experience.

The Company provides for property and casualty insurance losses when the insured event occurs. The Company provides for claims losses relating to its home warranty business based on the average cost per claim as applied to the total of new claims incurred. The average cost per home warranty claim is calculated using the average of the most recent 12 months of claims experience.

Operating revenues

Financial Services Group—Title premiums on policies issued directly by the Company are recognized on the effective date of the title policy and escrow fees are recorded upon close of the escrow. Revenues from title policies issued by independent agents are recorded when notice of issuance is received from the agent, which is generally when cash payment is received by the Company.

Revenues from home warranty contracts are recognized ratably over the 12-month duration of the contracts. Revenues from property and casualty insurance policies are also recognized ratably over the 12-month duration of the policies.

75

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Interest on loans of the Company’s thrift subsidiary is recognized on the outstanding principal balance on the accrual basis. Loan origination fees and related direct loan origination costs are deferred and recognized over the life of the loan. Revenues earned by the other products in the trust and banking operations of the Company are recognized at the time of delivery, as the Company has no significant ongoing obligation after delivery.

Information Solutions Group—The Company’s tax service division defers the tax service fee on life of loan contracts and recognizes that fee as revenue ratably over the expected service period. The amortization rates applied to recognize the revenues assume a 10-year contract life and are adjusted to reflect prepayments. The Company reviews its tax service contract portfolio quarterly to determine if there have been changes in contract lives and/or changes in the number and/or timing of prepayments. Accordingly, the Company may adjust the rates to reflect current trends. Subscription-based revenues are recognized ratably over the contractual term of the subscription. Revenues earned by most other products in the information solutions group are recognized at the time of delivery, as the Company has no significant ongoing obligation after delivery.

Premium taxes

Title insurance, property and casualty insurance and home warranty companies, like other types of insurers, are generally not subject to state income or franchise taxes. However, in lieu thereof, most states impose a tax based primarily on insurance premiums written. This premium tax is reported as a separate line item in the consolidated statements of income in order to provide a more meaningful disclosure of the taxation of the Company.

Income taxes

The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company evaluates the need to establish a valuation allowance for deferred tax assets based upon the amount of existing temporary differences, the period in which they are expected to be recovered and expected levels of taxable income. A valuation allowance to reduce deferred tax assets is established when it is “more likely than not” that some or all of the deferred tax assets will not be realized.

The Company recognizes the effect of income tax positions only if sustaining those positions is “more likely than not.” Changes in recognition or measurement of uncertain tax positions are reflected in the period in which a change in judgment occurs. The Company recognizes interest and penalties, if any, related to uncertain tax positions in tax expense. As a result of adopting the accounting guidance for uncertain tax positions, the Company recorded a cumulative effect adjustment of $8.1 million as a reduction to retained earnings as of January 1, 2007.

Share-based compensation

The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). The cost is recognized over the period during which an employee is required to provide services in exchange for the award. In accordance with the modified prospective method, the Company continues to use the Black-Scholes option-pricing model for

76

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

all unvested options as of December 31, 2005. The Company has selected the binomial lattice option-pricing model to estimate the fair value for any options granted after December 31, 2005. The Company utilizes the straight-line single option method of attributing the value of share-based compensation expense unless another expense attribution model is required by the guidance. As stock-based compensation expense recognized in the results of operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company applies the long-form method for determining the pool of windfall tax benefits.

The Company’s primary means of share-based compensation is granting restricted stock units (“RSUs”). The fair value of any RSU grant is based on the market value of the Company’s shares on the date of grant and is generally recognized as compensation expense over the vesting period. RSUs granted to certain key employees have graded vesting and have a service and performance requirement and are therefore expensed using the accelerated multiple-option method to record share-based compensation expense. All other RSU awards have graded vesting and service is the only requirement to vest in the award and are therefore generally expensed using the straight-line single option method to record share-based compensation expense. RSUs receive dividend equivalents in the form of RSUs having the same vesting requirements as the RSUs initially granted.

In addition to stock options and RSUs, the Company has an employee stock purchase plan that allows eligible employees to purchase common stock of the Company at 85.0% of the closing price on the last day of each month. The Company recognizes an expense in the amount equal to the discount.

Earnings (loss) per share

Basic earnings (loss) per share is computed by dividing net income (loss) available to FAC stockholders by the weighted-average number of common shares outstanding. The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that the weighted-average number of common shares outstanding is increased to include the number of additional common shares that would have been outstanding if dilutive stock options had been exercised and RSUs were vested. The dilutive effect of stock options and unvested RSUs is computed using the treasury stock method, which assumes any proceeds that could be obtained upon the exercise of stock options and vesting of RSUs would be used to purchase common shares at the average market price for the period. The assumed proceeds include the purchase price the grantee pays, the hypothetical windfall tax benefit that the Company receives upon assumed exercise or vesting and the hypothetical average unrecognized compensation expense for the period. The Company calculates the assumed proceeds from excess tax benefits based on the “as-if” deferred tax assets calculated under share based compensation standards.

Employee benefit plans

The Company recognizes the overfunded or underfunded status of defined benefit postretirement plans as an asset or liability on its consolidated balance sheets and recognizes changes in the funded status in the year in which changes occur, through accumulated other comprehensive loss, a component of FAC stockholders’ equity. The funded status is measured as the difference between the fair value of plan assets and benefit obligation (the projected benefit obligation for pension plans and the accumulated postretirement benefit obligation for the other postretirement plans). Actuarial gains and losses and prior service costs and credits that have not been recognized as a component of net periodic benefit cost previously are recorded as a component of accumulated other comprehensive loss. Plan assets and obligations are measured as of December 31.

77

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Foreign currency

The Company operates in foreign countries, including Canada, the United Kingdom and various other established and emerging markets. The functional currencies of the Company’s foreign subsidiaries are their respective local currencies. The financial statements of the foreign subsidiaries are translated into U.S. dollars for consolidation as follows: assets and liabilities at the exchange rate as of the balance sheet date, stockholders’ equity at the historical rates of exchange, and income and expense amounts at average rates prevailing throughout the period. Translation adjustments resulting from the translation of the subsidiaries’ accounts are included in accumulated other comprehensive loss a separate component of FAC stockholders’ equity. Gains and losses resulting from foreign currency transactions are included within other operating expenses.

Risk of real estate market

Real estate activity is cyclical in nature and is affected greatly by the cost and availability of long-term mortgage funds. Real estate activity and, in turn, the majority of the Company’s revenues can be adversely affected during periods of high interest rates, limited money supply and/or declining real estate values.

Escrow deposits and trust assets

The Company administers escrow deposits and trust assets as a service to its customers. Escrow deposits totaled $2.9 billion and $3.8 billion at December 31, 2009 and 2008, respectively, of which $0.9 billion and $1.04 billion, respectively, were held at the Company’s federal savings bank subsidiary, First American Trust, FSB. The escrow deposits held at First American Trust, FSB, are included in the accompanying consolidated balance sheets, with $794.3 million and $909.3 million included in debt and equity securities at December 31, 2009, and 2008, respectively, and $70.6 million and $135.2 million included in cash and cash equivalents at December 31, 2009 and 2008, respectively, with offsetting liabilities included in demand deposits. The remaining escrow deposits were held at third-party financial institutions.

Trust assets totaled $2.9 billion and $3.4 billion at December 31, 2009 and 2008, respectively, and were held at First American Trust, FSB. Escrow deposits held at third-party financial institutions and trust assets are not considered assets of the Company and, therefore, are not included in the accompanying consolidated balance sheets. However, the Company could be held contingently liable for the disposition of these assets.

In conducting its operations, the Company often holds customers’ assets in escrow, pending completion of real estate transactions. As a result of holding these customers’ assets in escrow, the Company has ongoing programs for realizing economic benefits, including investment programs, borrowing agreements, and vendor services arrangements with various financial institutions. The effects of these programs are included in the consolidated financial statements as income or a reduction in expense, as appropriate, based on the nature of the arrangement and benefit earned.

Like-kind exchanges

The Company facilitates tax-deferred property exchanges for customers pursuant to Section 1031 of the Internal Revenue Code and tax-deferred reverse exchanges pursuant to Revenue Procedure 2000-37. As a facilitator and intermediary, the Company holds the proceeds from sales transactions and takes temporary title to property identified by the customer to be acquired with such proceeds. Upon the completion of such exchange, the identified property is transferred to the customer or, if the exchange does not take place, an amount equal to the sales proceeds or, in the case of a reverse exchange, title to the property held by the Company is transferred

78

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

to the customer. Like-kind exchange funds held by the Company for the purpose of completing such transactions totaled $385.0 million and $553.1 million at December 31, 2009 and 2008, respectively, of which $186.0 million and $173.9 million at December 31, 2009 and 2008, respectively, were held at the First Security Business Bank (“FSBB”). The like-kind exchange deposits held at FSBB are included in the accompanying consolidated balance sheets, in cash and cash equivalents with offsetting liabilities included in demand deposits. The remaining exchange deposits were held at third-party financial institutions and, due to the structure utilized to facilitate these transactions, the proceeds and property are not considered assets of the Company under U.S. generally accepted accounting principles (“GAAP”) and, therefore, are not included in the accompanying consolidated balance sheets. All such amounts are placed in bank deposits with FDIC insured institutions. The Company could be held contingently liable to the customer for the transfers of property, disbursements of proceeds and the return on the proceeds.

Recent Accounting Pronouncements:

In June 2009, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance surrounding the Hierarchy of Generally Accepted Accounting Principles. This guidance established the FASB Accounting Standards Codification (“the Codification” or “ASC”) as the official single source of authoritative GAAP. All guidance contained in the Codification carries an equal level of authority. All existing accounting standards are superseded. All other accounting guidance not included in the Codification will be considered non-authoritative. The Codification also includes all relevant SEC guidance organized using the same topical structure in separate sections within the Codification. Following the Codification, the FASB will not issue new standards in the form of Statements, FASB Staff Positions or Emerging Issues Task Force Abstracts. Instead, it will issue Accounting Standards Updates which will serve to update the Codification, provide background information about the guidance and provide the basis for conclusions on the changes to the Codification. The Codification is not intended to change GAAP, but it will change the way GAAP is organized and presented. The Codification is effective for financial statements issued for interim and annual periods ending after September 15, 2009. Except for codifying existing GAAP, the adoption of this statement did not have an impact on the determination or reporting of the Company’s consolidated financial statements.

In September 2006, the FASB issued guidance related to defining fair value, establishing a framework for measuring fair value within GAAP, and expanding disclosure requirements regarding fair value measurements. Although this guidance does not require any new fair value measurements, its application may, in certain instances, change current practice. Where applicable, this guidance simplifies and codifies fair value related guidance previously issued within GAAP. In February 2008, the FASB issued authoritative guidance which delayed the effective date for application of the fair value framework to non-financial assets and non-financial liabilities until January 1, 2009. The provisions of this guidance related to financial assets and liabilities were applied as of January 1, 2008, and had no material effect on the Company’s consolidated financial statements. The fair value framework relating to non-financial assets and non-financial liabilities was applied as of January 1, 2009, and had no material effect on the Company’s consolidated financial statements. In October 2008, the FASB issued supplemental guidance relating to determining the fair value of a financial asset when the market for that asset is not active. This guidance clarifies the application of the fair value framework in cases where a market is not active. The Company considered the supplemental guidance in its determination of estimated fair values as of December 31, 2009 and 2008, and the impact was not material.

In February 2007, the FASB issued authoritative guidance permitting companies to elect to measure many financial assets and liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. The Company adopted this guidance effective January 1, 2008, but did not apply it to any assets or liabilities and, therefore, the adoption had no effect on its consolidated financial statements.

79

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

In April 2009, the FASB issued authoritative guidance surrounding the determination of fair value when the volume and level of activity for an asset or liability have significantly decreased and identifying transactions that are not orderly. The guidance indicates that if an entity determines that either the volume and/or level of activity for an asset or liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair value. The guidance is effective for interim and annual periods ending after June 15, 2009, with early adoption permitted. Further, this guidance must be applied prospectively. The Company elected to adopt the guidance in the first quarter of 2009. The adoption of the guidance did not have a material impact on the Company’s consolidated financial statements.

In April 2009, the FASB issued guidance relating to fair value disclosures in public entity financial statements for financial instruments. This guidance increases the frequency of those disclosures, requiring public entities to provide the disclosures on a quarterly basis, rather than annually. The guidance is effective for interim and annual periods ending after June 15, 2009. The Company adopted this guidance in the second quarter of 2009. Except for the disclosure requirements, the adoption of this guidance did not have an impact on the Company’s consolidated financial statements.

In April 2009, the FASB issued guidelines which establish a new method of recognizing and reporting other-than-temporary impairments of debt securities. It also contains additional disclosure requirements related to debt and equity securities and changes existing impairment guidance. For debt securities, the “ability and intent to hold” provision is eliminated, and impairment is considered to be other-than-temporary if an entity (i) intends to sell the security, (ii) more likely than not will be required to sell the security before recovering its cost, or (iii) does not expect to recover the security’s entire amortized cost basis (even if the entity does not intend to sell). This new framework does not apply to equity securities (i.e., impaired equity securities will continue to be evaluated under previously existing guidance). The “probability” standard relating to the collectability of cash flows is eliminated, and impairment is now considered to be other-than-temporary if the present value of cash flows expected to be collected from the debt security is less than the amortized cost basis of the security. The guidance also provides that for debt securities which (i) an entity does not intend to sell and (ii) it is not more likely than not that the entity will be required to sell before the anticipated recovery of its remaining amortized cost basis, the impairment is separated into the amount related to estimated credit losses and the amount related to all other factors. The amount of the total impairment related to all other factors is recorded in accumulated other comprehensive loss and the amount related to estimated credit loss is recognized as a charge against current period earnings. This guidance is effective for interim and annual periods ending after June 15, 2009, with early adoption permitted. The Company elected to adopt this guidance in the first quarter of 2009. See the discussion in Note 4 Debt and Equity Securities to the consolidated financial statements regarding the impact of adoption.

In April 2009, the SEC issued authoritative guidance surrounding other-than-temporary impairment which amended existing SEC guidance relating to other-than-temporary impairment for certain investments in debt and equity securities. The guidance maintains the SEC staff’s previous views related to equity securities, but now excludes debt securities from its scope. The Company elected to adopt this guidance in the first quarter of 2009. There was no material impact on the Company’s consolidated financial statements as a result of adopting this guidance.

In December 2007, the FASB revised authoritative guidance surrounding business combinations. The guidance retains the fundamental requirements contained in the original pronouncement. For example, the acquisition method of accounting, previously known as the purchase method, is required to be used for all business combinations and for an acquirer to be identified for each business combination. This revised guidance establishes principles and requirements for how the acquirer recognizes and measures in its financial statements

80

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. Further, this guidance requires contingent consideration to be recognized at its fair value on the acquisition date and, for certain arrangements, changes in fair value to be recognized in earnings until settled. This guidance also requires acquisition-related transaction and restructuring costs to be expensed rather than treated as part of the cost of the acquisition. The Company adopted this guidance on January 1, 2009 and the adoption did not have a material impact on its financial statements.

In April 2009, the FASB issued supplemental guidance surrounding accounting for assets acquired and liabilities assumed in a business combination that arise from contingencies. The FASB voted to carry forward the requirements under existing guidelines surrounding business combinations for acquired contingencies, which required contingencies to be recognized at fair value on the acquisition date if the fair value could be reasonably estimated during the allocation period. Otherwise, companies would typically account for the acquired contingencies in accordance with authoritative literature surrounding accounting for contingencies. As a result of the requirement to carry forward the accounting treatment for acquired contingencies, accounting for pre-acquisition contingencies may be an exception to the recognition and fair value measurement under authoritative guidance surrounding business combinations. Additionally, the FASB voted to change the accounting for an acquiree’s pre-existing contingent consideration arrangement that was assumed by the acquirer as part of the business combination. Such arrangements will now be accounted for as contingent consideration by the acquirer. The revised guidance is effective for all business combinations for which the acquisition date was on or after January 1, 2009. The adoption of this guidance had no impact on the Company’s consolidated financial statements.

In December 2007, the FASB issued guidance surrounding noncontrolling interest in consolidated financial statements—an amendment to existing authoritative literature. The newly issued guidance requires recharacterizing minority interests as noncontrolling interests in addition to classifiying noncontrolling interest as a component of equity. The guidance also establishes reporting requirements to provide disclosures that identify and distinguish between the interests of the parent and the interests of noncontrolling owners. This guidance requires retroactive adoption of the presentation and disclosure requirements for existing minority interests – all other requirements are to be applied prospectively. All periods presented in these consolidated financial statements reflect the presentation and disclosure required by this guidance. All other requirements under the guidance are being applied prospectively. The Company adopted this guidance on January 1, 2009. Except for the presentation and disclosure requirements required by this guidance, there was no impact on the Company’s financial statements.

In May 2009, the FASB issued authoritative guidance relating to the disclosure of subsequent events. This guidance is modeled after the same principles as the subsequent event guidance in auditing literature with some terminology changes and additional disclosures. This guidance is effective for interim and annual periods ending after June 15, 2009, and is required to be applied prospectively. The Company adopted the guidance in the second quarter of 2009. Except for the disclosure requirements, the adoption of the guidance had no impact on the Company’s consolidated financial statements.

In December 2008, the FASB issued guidance that expands the disclosures required in an employer’s financial statements about pension and other postretirement benefit plan assets. The new disclosures include more details about the categories of plan assets and information regarding fair value measurements. This guidance is effective for fiscal years ending after December 15, 2009. The Company adopted the guidance in the fourth quarter of 2009 and except for the disclosure requirements, the adoption had no impact on its consolidated financial statements.

81

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Pending Accounting Pronouncements:

In January 2010, the FASB issued updated guidance related to fair value measurements and disclosures, which requires a reporting entity to disclose separately the amounts of significant transfers in and out of Level 1 and Level 2 fair value measurements and to describe the reasons for the transfers. In addition, in the reconciliation for fair value measurements using significant unobservable inputs, or Level 3, a reporting entity should disclose separately information about purchases, sales, issuances and settlements (that is, on a gross basis rather than one net number). The updated guidance also requires that an entity should provide fair value measurement disclosures for each class of assets and liabilities and disclosures about the valuation techniques and inputs used to measure fair value for both recurring and non-recurring fair value measurements for Level 2 and Level 3 fair value measurements. The updated guidance is effective for interim or annual financial reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances and settlements in the roll forward activity in Level 3 fair value measurements, which are effective for fiscal years beginning after December 15, 2010 and for interim periods within those fiscal years. Management does not expect the adoption of this standard will have a material impact on the Company’s consolidated financial statements.

In June 2009, the FASB issued guidelines relating to transfers of financial assets which amended existing guidance by removing the concept of a qualifying special purpose entity and establishing a new “participating interest” definition that must be met for transfers of portions of financial assets to be eligible for sale accounting, clarifies and amends the derecognition criteria for a transfer to be accounted for as a sale, and changes the amount that can be recognized as a gain or loss on a transfer accounted for as a sale when beneficial interests are received by the transferor. Enhanced disclosures are also required to provide information about transfers of financial assets and a transferor’s continuing involvement with transferred financial assets. This guidance must be applied as of the beginning of an entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Earlier application is prohibited. Management does not expect the adoption of this standard will have a material impact on the Company’s consolidated financial statements.

In June 2009, the FASB issued guidance amending existing guidance surrounding the consolidation of variable interest entities to require an enterprise to qualitatively assess the determination of the primary beneficiary of a variable interest entity (“VIE”) based on whether the entity (1) has the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (2) has the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. This guidance also requires an ongoing reconsideration of the primary beneficiary, and amends the events that trigger a reassessment of whether an entity is a VIE. Enhanced disclosures are also required to provide information about an enterprise’s involvement in a VIE. This statement is effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Earlier application is prohibited. Management is currently evaluating the effect that adoption of this standard will have on the Company’s consolidated financial position and results of operations when it becomes effective in 2010.

NOTE 2.    Spin-off and other Corporate Developments:

On January 15, 2008, the Company announced that its Board of Directors had approved a plan to separate the Company into two independent publicly traded companies (the “separation”), one consisting of the Company’s financial services businesses, FinCo, and one for its information solutions businesses, InfoCo. The Company expects to accomplish this by way of a dividend distribution of the common stock of FinCo, the

82

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Company’s wholly-owned subsidiary, to the Company’s shareholders (the “Distribution”). Immediately following the Distribution, the Company’s shareholders will own 100% of the outstanding common stock of FinCo. Prior to the Distribution, certain internal transactions will occur so that FinCo directly or indirectly owns all of the Company’s financial services businesses and the title plant management business. The remaining entity, InfoCo, will own all of the Company’s remaining information solutions businesses. FinCo will adopt the “FAF” ticker symbol and its shares of common stock will be traded on the New York Stock Exchange under that symbol. InfoCo will change its name and ticker symbol following the separation.

The Company continues to proceed with preparations for the separation, and currently expects the separation to occur during the first half of 2010, with a target date of June 1, 2010. The Company’s subsidiary, First American Financial Corporation, filed a Form 10 Registration Statement with the Securities and Exchange Commission on December 14, 2009, and Amendment No. 1 thereto on February 12, 2010, in preparation for the separation. The transaction remains subject to customary conditions, including final approval by the Board of Directors, effectiveness of the Form 10 Registration Statement, receipt of a tax ruling from the Internal Revenue Service and the approval of applicable regulatory authorities, some of which have already been received.

On November 18, 2009, the Company consummated the buy-in of the publicly held shares of First Advantage. See further discussion at Note 24 Business Combinations and Divestitures to the consolidated financial statements.

On December 31, 2009, the Company entered into a Joint Venture Restructuring Agreement by and among the Company, certain of its subsidiaries and Experian Information Solutions, Inc. (“Experian”), the Company’s partner in its First American Real Estate Solutions LLC (“FARES”) joint venture. The Company and Experian also entered into an Amended and Restated Contribution and Joint Venture Agreement and Amended and Restated Operating Agreement for FARES, dated as of December 31, 2009. See further discussion at Note 20 Redeemable Noncontrolling Interests to the consolidated financial statements.

NOTE 3.    Statutory Restrictions on Investments and Stockholders’ Equity:

Investments carried at $135.4 million were on deposit with state treasurers in accordance with statutory requirements for the protection of policyholders at December 31, 2009.

Pursuant to insurance and other regulations of the various states in which the Company’s insurance subsidiaries operate, the amount of dividends, loans and advances available to the Company is limited, principally for the protection of policyholders. Under such statutory regulations, the maximum amount of dividends, loans and advances available to the Company from its insurance subsidiaries in 2010 is $258.0 million.

The Company’s title insurance subsidiary, First American Title Insurance Company, maintained statutory surplus of $802.3 million and $602.0 million as of December 31, 2009 and 2008, respectively. Statutory net income for the year ended December 31, 2009 was $213.1 million. Statutory net loss for the year ended December 31, 2008 was $89.4 million. Statutory net income for the year ended December 31, 2007 was $12.1 million.

Statutory accounting principles differ in some respects from GAAP, and these differences include, but are not limited to non-admission of certain assets (principally limitations on deferred tax assets, capitalized furniture and other equipment, premiums and other receivables 90 days past due, assets acquired in connection with claim settlements other than real estate or mortgage loans secured by real estate and limitations on goodwill), reporting of bonds at amortized cost, deferral of premiums received as statutory premium reserve and supplemental reserve (if applicable), exclusion of incurred but not reported claims reserve.

83

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 4.    Debt and Equity Securities:

The amortized cost and estimated fair value of investments in debt securities, all of which are classified at available-for-sale, are as follows:

	Amortized cost		Gross unrealized					Estimated fair value
			gains		losses
	(in thousands)
December 31, 2009
U.S. Treasury bonds	$	72,316	$	1,834	$	(297	)	$	73,853
Municipal bonds		132,965		2,484		(493	)		134,956
Foreign bonds		150,105		1,886		(83	)		151,908
Governmental agency bonds		326,787		1,816		(1,829	)		326,774
Governmental agency mortgage-backed and asset-backed securities		1,023,867		14,829		(6,083	)		1,032,613
Non-agency mortgage-backed and asset-backed securities		97,395		1,548		(37,519	)		61,424
Corporate debt securities		86,911		1,204		(1,230	)		86,885
	$	1,890,346	$	25,601	$	(47,534	)	$	1,868,413
December 31, 2008
U.S. Treasury bonds	$	39,574	$	3,436	$	(4	)	$	43,006
Municipal bonds		80,136		1,610		(2,448	)		79,298
Foreign bonds		97,371		3,300		(78	)		100,593
Governmental agency bonds		128,403		3,448		(381	)		131,470
Governmental agency mortgage-backed and asset-backed securities		1,196,381		9,233		(33,225	)		1,172,389
Non-agency mortgage-backed and asset-backed securities		137,696		—		(52,188	)		85,508
Corporate debt securities		114,208		1,643		(9,795	)		106,056
	$	1,793,769	$	22,670	$	(98,119	)	$	1,718,320

The amortized cost and estimated fair value of debt securities at December 31, 2009, by contractual maturities, are as follows:

	Amortized cost		Estimated fair value
	(in thousands)
Due in one year or less	$	101,287	$	101,774
Due after one year through five years		464,793		468,274
Due after five years through ten years		157,310		158,842
Due after ten years		45,694		45,486
		769,084		774,376
Mortgage-backed and asset-backed securities		1,121,262		1,094,037
	$	1,890,346	$	1,868,413

84

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The cost and estimated fair value of investments in equity securities, all of which are classified as available-for-sale, are as follows:

	Cost		Gross unrealized					Estimated fair value
			gains		losses
	(in thousands)
December 31, 2009
Preferred stocks	$	32,007	$	1,523	$	(2,179	)	$	31,351
Common stocks		43,589		24,228		(1	)		67,816
	$	75,596	$	25,751	$	(2,180	)	$	99,167
December 31, 2008
Preferred stocks	$	52,056	$	63	$	(15,206	)	$	36,913
Common stocks		89,443		4,201		(20,431	)		73,213
	$	141,499	$	4,264	$	(35,637	)	$	110,126

Sales of debt and equity securities resulted in realized gains of $21.9 million, $6.3 million and $3.5 million and realized losses of $3.5 million, $5.8 million and $1.2 million for the years ended December 31, 2009, 2008 and 2007, respectively.

85

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The Company had the following gross unrealized losses as of December 31, 2009 and December 31, 2008:

	12 months or less					12 months or longer					Total
	Estimated fair value		Unrealized losses			Estimated fair value		Unrealized losses			Estimated fair value		Unrealized losses
	(in thousands)
December 31, 2009
Debt securities
U.S. Treasury bonds	$	44,382	$	(297	)	$	—	$	—		$	44,382	$	(297	)
Municipal bonds		42,428		(448	)		25,067		(45	)		67,495		(493	)
Foreign bonds		28,541		(82	)		1,091		(1	)		29,632		(83	)
Governmental agency bonds		185,351		(1,817	)		4,138		(12	)		189,489		(1,829	)
Governmental agency mortgage-backed and asset-backed securities		268,778		(3,051	)		319,375		(3,032	)		588,153		(6,083	)
Non-agency mortgage-backed and asset-backed securities		1,767		(176	)		56,955		(37,343	)		58,722		(37,519	)
Corporate debt securities		49,970		(443	)		23,500		(787	)		73,470		(1,230	)
Total debt securities		621,217		(6,314	)		430,126		(41,220	)		1,051,343		(47,534	)
Equity securities		1,523		(1,380	)		7,776		(800	)		9,299		(2,180	)
Total	$	622,740	$	(7,694	)	$	437,902	$	(42,020	)	$	1,060,642	$	(49,714	)
December 31, 2008
Debt securities
U.S. Treasury bonds	$	246	$	(4	)	$	—	$	—		$	246	$	(4	)
Municipal bonds		1,149		(8	)		20,550		(2,440	)		21,699		(2,448	)
Foreign bonds		2,798		(1	)		6,329		(77	)		9,127		(78	)
Governmental agency bonds		13,099		(75	)		296		(306	)		13,395		(381	)
Governmental agency mortgage-backed and asset-backed securities		361,154		(10,854	)		399,210		(22,371	)		760,364		(33,225	)
Non-agency mortgage-backed and asset-backed securities		29,263		(19,800	)		56,246		(32,388	)		85,509		(52,188	)
Corporate debt securities		13,568		(1,029	)		61,078		(8,766	)		74,646		(9,795	)
Total debt securities		421,277		(31,771	)		543,709		(66,348	)		964,986		(98,119	)
Equity securities		37,915		(16,248	)		23,096		(19,389	)		61,011		(35,637	)
Total	$	459,192	$	(48,019	)	$	566,805	$	(85,737	)	$	1,025,997	$	(133,756	)

Dislocations in the capital and credit markets continue to result in extreme volatility and disruption in the financial markets. These and other factors including the tightening of credit markets, failures of significant financial institutions, declines in real estate values, uncertainty regarding the timing and effectiveness of governmental solutions, and a general slowdown in economic activity have contributed to decreases in the fair value of the investment portfolio as of December 31, 2009. It is possible that the Company could recognize impairment losses on some securities it owns at December 31, 2009 if future events or information cause it to determine that a decline in value is other-than-temporary.

86

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following table presents the Company’s available-for-sale investments measured at fair value on a recurring basis as of December 31, 2009 and 2008, classified using the three-level hierarchy for fair value measurements:

	Estimated fair value as of December 31, 2009		Level 1		Level 2		Level 3
	(in thousands)
Debt securities
U.S. Treasury bonds	$	73,853	$	—	$	73,853	$	—
Municipal bonds		134,956		—		134,956		—
Foreign bonds		151,908		—		151,908		—
Governmental agency bonds		326,774		—		326,774		—
Governmental agency mortgage-backed and asset-backed securities		1,032,613		—		1,032,613		—
Non-agency mortgage-backed and asset-backed securities		61,424		—		—		61,424
Corporate debt securities		86,885		—		86,885		—
		1,868,413		—		1,806,989		61,424
Equity securities
Preferred stocks		31,351		31,351		—		—
Common stocks		67,816		67,816		—		—
		99,167		99,167		—		—
	$	1,967,580	$	99,167	$	1,806,989	$	61,424
	Estimated fair value as of December 31, 2008		Level 1		Level 2		Level 3
	(in thousands)
Debt securities
U.S. Treasury bonds	$	43,006	$	—	$	43,006	$	—
Municipal bonds		79,298		—		79,298		—
Foreign bonds		100,593		—		100,593		—
Governmental agency bonds		131,470		—		131,470		—
Governmental agency mortgage-backed and asset-backed securities		1,172,389		—		1,172,389		—
Non-agency mortgage-backed and asset-backed securities		85,508		—		85,508		—
Corporate debt securities		106,056		—		106,056		—
		1,718,320		—		1,718,320		—
Equity securities
Preferred stocks		36,913		36,913		—		—
Common stocks		73,213		73,213		—		—
		110,126		110,126		—		—
	$	1,828,446	$	110,126	$	1,718,320	$	—

87

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The Company reviews the fair value measurement classification of its available-for-sale investments quarterly. During the quarter ended December 31, 2009, the Company determined that the fair values of its non-agency mortgage-backed and asset-backed securities were estimated using certain significant unobservable inputs, which resulted in a Level 3 classification. The Company’s policy is to report transfers into Level 3 as of the end of the period.

In the first quarter of 2009, the Company adopted newly issued accounting guidance that establishes a new method of recognizing and reporting other-than-temporary impairment of debt securities. The Company assesses the unrealized losses in its debt security portfolio under this guidance, primarily the non-agency mortgage-backed and asset-backed securities. If the Company determines it does not expect to recover the amortized cost basis of a debt security with declines in fair value (even if it does not intend to sell or it is not more likely than not that it will be required to sell the debt security before the recovery of the debt security’s remaining amortized cost basis), the credit portion of the other-than-temporary impairment loss is recognized in earnings and the non-credit portion, if any, is recognized in other comprehensive income. The credit portion of the other-than-temporary impairment loss is the difference between the present value of the cash flows expected to be collected and the amortized cost basis of the debt security. Expected future cash flows are based on qualitative and quantitative factors, including the probability of default and the estimated timing and amount of recovery. For non-agency mortgage-backed and asset-backed securities, estimated future cash flows are based on the structure of the security and certain assumptions, such as the remaining payment terms of the security, prepayment speeds, default rates and loss severity on the collateral supporting the security. In developing the assumptions used in estimating the expected future cash flows, the Company utilized publicly available information related to individual assets, generally available market data such as forward interest rate curves and its securities data and market analytic tools. The expected future cash flows are discounted using the current accrual rate attributable to the security. As a result of the Company’s security-level review and other economic factors, the Company recognized total other-than-temporary impairments of $50.6 million associated with non-agency mortgage-backed and asset-backed securities for the year ended December 31, 2009. $19.7 million of other-than-temporary impairment losses were considered to be credit related and were recognized in earnings and $30.9 million of other-than-temporary impairment losses were considered to be related to factors other than credit and were recognized in other comprehensive income for the year ended December 31, 2009.

The following table presents the change in other-than-temporary credit related impairment charges recognized in earnings on non-agency mortgage-backed and asset-backed securities for which a portion of the other-than-temporary impairments related to other factors was recognized in other comprehensive income (loss):

	(in thousands)
Credit related impairments on non-agency mortgage-backed and asset-backed securities as of December 31, 2008	$	—
Credit related impairments not previously recognized		19,745
Credit related impairments on non-agency mortgage-backed and asset-backed securities as of December 31, 2009	$	19,745

When, in the Company’s opinion, a decline in the fair value of an equity security, including common and preferred stock, is considered to be other-than-temporary, such equity security is written down to its fair value. When assessing if a decline in value is other-than-temporary, the factors considered include the length of time and extent to which fair value has been below cost, the probability that the Company will be unable to collect all amounts due under the contractual terms of the security, the seniority and duration of the securities (including estimates of prepayments and credit losses and sensitivity analysis of those estimates), issuer-specific news and

88

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

other developments, the financial condition and prospects of the issuer (including credit ratings), macro-economic changes (including the outlook for industry sectors, which includes government policy initiatives) and the Company’s ability and intent to hold the investment for a period of time sufficient to allow for any anticipated recovery.

When an equity security has been in an unrealized loss position for greater than twelve months, the Company’s review of the security includes the above noted factors as well as what evidence, if any, exists to support that the security will recover its value in the foreseeable future, typically within the next twelve months. If objective, substantial evidence does not indicate a likely recovery during that timeframe, the Company’s policy is that such losses are considered other-than-temporary and therefore an impairment loss is recorded. For the year ended December 31, 2009, the Company concluded that such evidence was not available on 51 common equity securities and 15 preferred equity securities. Accordingly, an other-than-temporary impairment charge of $16.3 million and $5.7 million, relating to the Company’s common and preferred equity securities, respectively, was recorded in earnings. The Company elected to convert its preferred stock in Citigroup Inc. into common stock of that entity under the terms of Citigroup’s publicly announced exchange offer. Based on the terms of the exchange offer and the level at which Citigroup’s common stock was trading, the Company concluded that the investment was other-than-temporarily impaired by $3.5 million which is included in the other-than-temporary impairment charge for preferred equity securities above. The common stock was subsequently sold for a gain of $10.9 million. For the year ended December 31, 2008, the Company recognized an other-than-temporary impairment charge in earnings of $34.8 million related to its investments in perpetual preferred securities issued by the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”). The impairment was due to actions taken by the United States government with respect to Fannie Mae and Freddie Mac.

Most of the Company’s preferred equity securities are in the financial services sector, which it believes to be in a temporary, though potentially protracted, downturn. While the duration of disruption in the financial services sector, and accompanying depressed market values of industry participants’ preferred equity securities, are unknown, the Company believes a full recovery is likely and the Company has the ability and intent to hold the equity preferred securities that are currently in an unrealized loss position until that recovery occurs. The Company believes that the United States government’s adopted policy of stabilizing the financial services sector is an important factor in its determination that the sector will return to a more normal operating environment. The Company has also assessed the historic and current credit ratings of the individual issuers, the capital adequacy and anticipated profitability of each issuer, and any changes to the investments’ fair value subsequent to the balance sheet date. Based on these factors, it has concluded that none of the individual investments, except those for which an impairment charge was recorded, were other-than-temporarily impaired as of December 31, 2009 and 2008.

NOTE 5.    Loans Receivable:

Loans receivable are summarized as follows:

	December 31
	2009			2008
	(in thousands)
Real estate—mortgage	$	164,055		$	153,853
Other		773			69
		164,828			153,922
Allowance for loan losses		(2,071	)		(1,600	)
Participations sold		(1,031	)		(799	)
Deferred loan fees, net		171			169
	$	161,897		$	151,692

89

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Real estate loans are collateralized by properties located primarily in Southern California. The average yield on the Company’s loan portfolio was 6.78% and 7.08% for the years ended December 31, 2009 and 2008, respectively. Average yields are affected by prepayment penalties recorded as income, prepayment speeds, loan fees amortized to income and the market interest rates.

The allowance for loan losses is maintained at a level that is considered appropriate by management to provide for known risks in the portfolio.

The aggregate annual maturities for loans receivable are as follows:

Year	(in thousands)
2010	$	43
2011		3,111
2012		3,221
2013		2,260
2014		2,808
2015 and thereafter		153,385
	$	164,828

NOTE 6.    Property and Equipment:

Property and equipment consists of the following:

	December 31
	2009			2008
	(in thousands)
Land	$	38,273		$	40,457
Buildings		264,093			267,838
Furniture and equipment		468,323			498,275
Capitalized software		736,378			744,652
		1,507,067			1,551,222
Accumulated depreciation and amortization		(915,285	)		(885,917	)
	$	591,782		$	665,305

90

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 7.    Goodwill:

A reconciliation of the changes in the carrying amount of goodwill and accumulated impairment losses, by operating segment, for the years ended December 31, 2009 and 2008, is as follows:

	Financial Services					Information Solutions
	Title Insurance			Specialty Insurance		Information and Outsourcing Solutions			Data and Analytic Solutions			Risk Mitigation and Business Solutions			Total
	(in thousands)
Balance as of January 1, 2008
Goodwill	$	730,665		$	41,525	$	649,806		$	439,800		$	712,469		$	2,574,265
Accumulated impairment		—			—		(6,925	)		—			—			(6,925	)
		730,665			41,525		642,881			439,800			712,469			2,567,340
Acquired during the year		9,877			4,531		—			14,566			21,823			50,797
Dispositions		(6,025	)		—		—			—			—			(6,025	)
Impairment		—			—		—			—			(19,734	)		(19,734	)
Other/ post acquisition adjustments		(28,442	)		—		(1,362	)		(2,091	)		34,255			2,360
Balance as of December 31, 2008
Goodwill		706,075			46,056		648,444			452,275			768,547			2,621,397
Accumulated impairment		—			—		(6,925	)		—			(19,734	)		(26,659	)
		706,075			46,056		641,519			452,275			748,813			2,594,738
Acquired during the year		—			—		—			5,472			—			5,472
Dispositions		(6,317	)		—		—			—			—			(6,317	)
Other/ post acquisition adjustments		1,866			—		3,008			(2,491	)		21,301			23,684
Balance as of December 31, 2009
Goodwill		701,624			46,056		651,452			455,256			789,848			2,644,236
Accumulated impairment		—			—		(6,925	)		—			(19,734	)		(26,659	)
	$	701,624		$	46,056	$	644,527		$	455,256		$	770,114		$	2,617,577

The Company’s reporting units for purposes of testing impairment are title insurance, home warranty, property and casualty insurance, trust and other services, data and analytic solutions, information and outsourcing solutions, lender services, data services, dealer services, employer services, multifamily services and investigative and litigation support services.

In accordance with accounting guidance and consistent with prior years, the Company’s policy is to perform an annual goodwill impairment test for each reporting unit in the fourth quarter. Although recent market conditions and economic events have had an overall negative impact on the Company’s operations and related financials results, impairment analyses were not performed at any other time in the year as no triggering events requiring such an analysis occurred.

The Company’s 2009 evaluation did not indicate impairment in any of its reporting units. Due to significant volatility in the current markets, the Company’s operations may be negatively impacted in the future to the extent that exposure to impairment losses may be increased.

91

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

As of the date of the Company’s 2009 annual impairment review, the title insurance reporting unit included $699.5 million of goodwill. The fair value of this reporting unit under the income and market value approaches exceeded the carrying value of the reporting unit’s book value by approximately 4.5% and 20.0%, respectively. The property and casualty insurance reporting unit included $33.2 million of goodwill as of the Company’s 2009 annual impairment review. The fair value of this reporting unit under the income and market value approaches exceeded the carrying value of the reporting unit’s book value by approximately 36.0% and 6.4%, respectively. Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions, including revenue growth rates and operating margins, discount rates and future market conditions, among others. It is reasonably possible that changes in the judgments, assumptions and estimates the Company made in assessing the fair value of its goodwill could cause these or other reporting units to become impaired. There were no other reporting units that management deemed to have a reasonable risk of material impairment charge at this time.

The Company’s 2008 evaluation resulted in an impairment loss of $19.7 million in the data services reporting unit in the fourth quarter based primarily upon diminished earnings and cash flow expectations for the lead generation business and lower residual valuation multiples existing in the then present market conditions. The 2008 evaluation did not indicate impairment in any other reporting units.

NOTE 8.    Other Intangible Assets:

Other intangible assets consist of the following:

	December 31
	2009			2008
	(in thousands)
Finite-lived intangible assets:
Customer lists	$	359,711		$	359,805
Covenants not to compete		58,836			59,884
Trademarks		38,724			42,741
		457,271			462,430
Accumulated amortization		(219,466	)		(182,957	)
		237,805			279,473
Indefinite-lived intangible assets:
Licenses		19,721			18,938
	$	257,526		$	298,411

Amortization expense for finite-lived intangible assets was $47.0 million, $51.9 million and $51.1 million for the years ended December 31, 2009, 2008 and 2007, respectively.

Estimated amortization expense for finite-lived intangible assets anticipated for the next five years is as follows:

Year
	(in thousands)
2010	$	45,138
2011	$	40,788
2012	$	36,798
2013	$	32,633
2014	$	19,644

92

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 9.    Demand Deposits:

Escrow, passbook and investment certificate accounts are summarized as follows:

	December 31
	2009			2008
	(in thousands, except percentages)
Escrow accounts:
Interest bearing	$	670,308		$	732,648
Non-interest bearing		222,621			311,880
		892,929			1,044,528
Passbook accounts		215,031			217,356
Certificate accounts:
Less than one year		27,829			22,479
One to five years		17,785			13,858
		45,614			36,337
	$	1,153,574		$	1,298,221
Annualized interest rates:
Escrow accounts		0.61	%		1.37	%
Passbook accounts		0.33	%		1.13	%
Certificate accounts		3.23	%		4.36	%

NOTE 10.    Reserve for Known and Incurred But Not Reported Claims:

Activity in the reserve for known and incurred but not reported claims is summarized as follows:

	December 31
	2009			2008			2007
	(in thousands)
Balance at beginning of year	$	1,355,392		$	1,357,632		$	936,989
Provision related to:
Current year		390,887			455,794			527,566
Prior years		(7,435	)		77,530			366,379
		383,452			533,324			893,945
Payments, net of recoveries, related to:
Current year		182,892			200,840			195,367
Prior years		314,887			301,258			292,298
		497,779			502,098			487,665
Other		14,023			(33,466	)		14,363
Balance at end of year	$	1,255,088		$	1,355,392		$	1,357,632

93

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

“Other” primarily represents reclassifications to the reserve for assets acquired in connection with claim settlements and purchase accounting adjustments related to company acquisitions and foreign currency gains/losses. Claims activity associated with reinsurance is not material and, therefore, not presented separately. Current year payments include $191.2 million, $191.3 million and $186.5 million in 2009, 2008 and 2007, respectively, that relate to the Company’s non-title insurance operations.

The provision for title insurance losses, expressed as a percentage of title insurance operating revenues, was 5.8% in 2009, 8.8% in 2008 and 13.0% in 2007. The current year rate reflects an expected ultimate loss rate of 6.0% for policy year 2009, with a minor downward adjustment to the reserve for certain prior policy years. The prior year rate of 8.8% included a $78.0 million reserve strengthening adjustment. The adjustment reflected changes in estimates for ultimate losses expected, primarily from policy years 2006 and 2007. The changes in estimates resulted primarily from higher than expected claims emergence, in both frequency and aggregate amounts, experienced during 2008, for those policy years. There were many factors that impacted the claims emergence, including but not limited to: decreases in real estate prices during 2008; increases in defaults and foreclosures during 2008; and higher than expected claims emergence from lenders policies. The rate of 13.0% for 2007 included $365.9 million in reserve strengthening adjustments, which reflected changes in estimates for ultimate losses expected, primarily from policy years 2004 through 2006. The changes in estimates resulted primarily from higher than expected claims emergence, in both frequency and aggregate amounts, experienced during 2007. There were many factors that impacted the claims emergence, including but not limited to decreases in real estate prices during 2007 and increases in defaults and foreclosures during 2007. In addition, the reserve strengthening adjustments reflected a large single fraud loss resulting from a settlement during 2007 of a claim under a closing protection letter issued during 2005. The claim involved multiple properties and the settlement amount exceeded what had been included in reserves for that type of claim, such reserves having been established based on the Company’s actuarial analysis. Since the loss was determined to be an isolated event with no future trend component, the adjustment to reserves associated with the closing protection letter only impacted 2007. The reserve strengthening adjustments made during 2007 also reflected an increase in claims emergence from a large title agent related to the geographic expansion of the agent’s business combined with changes in economic conditions. In addition, the adjustments reflected higher-than-expected claims from a recently-acquired underwriter, due to changes in the business strategy with respect to the underwriter post-acquisition combined with unfavorable external economic events. The Company continuously monitors the impact, if any, of these types of events on the Company’s reserve balances and adjusts the reserves when facts and circumstances indicate a change is warranted.

The current economic environment appears to have more potential for volatility than usual over the short term, particularly in regard to real estate prices and mortgage defaults, which directly affect title claims. Relevant contributing factors include general economic instability and government actions that may mitigate or exacerbate recent trends. Other factors, including factors not yet identified, may also influence claims development. At this point, economic and market conditions appear to be improving, yet significant uncertainty remains. This environment results in increased potential for actual claims experience to vary significantly from projections, in either direction, which would directly affect the claims provision. If actual claims vary significantly from expected, reserves may need to be adjusted to reflect updated estimates of future claims.

The volume and timing of title insurance claims are subject to cyclical influences from real estate and mortgage markets. Title policies issued to lenders are a large portion of the Company’s title insurance volume. These policies insure lenders against losses on mortgage loans due to title defects in the collateral property. Even if an underlying title defect exists that could result in a claim, often the lender must realize an actual loss, or at least be likely to realize an actual loss, for title insurance liability to exist. As a result, title insurance claims exposure is sensitive to lenders’ losses on mortgage loans, and is affected in turn by external factors that affect mortgage loan losses.

94

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

A general decline in real estate prices can expose lenders to greater risk of losses on mortgage loans, as loan-to-value ratios increase and defaults and foreclosures increase. The current environment may continue to have increased potential for claims on lenders’ title policies, particularly if defaults and foreclosures are at elevated levels. Title insurance claims exposure for a given policy year is also affected by the quality of mortgage loan underwriting during the corresponding origination year. Management believes that sensitivity of claims to external conditions in real estate and mortgage markets is an inherent feature of title insurance’s business economics that applies broadly to the title insurance industry. Lenders have been experiencing higher losses on mortgage loans from prior years, including loans that were originated during the past several years. These losses have led to higher title insurance claims on lenders policies, and also have accelerated the reporting of claims that would have been realized later under more normal conditions.

Loss ratios (projected to ultimate value) for policy years 1991-2004 are all below 6.0% and average 4.8%. By contrast, loss ratios for policy years 2005-2007 range from 7.6% to 7.9%. The major causes of the higher loss ratios for those three policy years are believed to be confined mostly to that period. These causes included: rapidly increasing residential real estate prices which led to an increase in the incidences of fraud, lower mortgage loan underwriting standards and a higher concentration than usual of subprime mortgage loan originations.

The projected ultimate loss ratios for policy years 2009 and 2008 are 6.0% and 6.5%, respectively, which are lower than the ratios for 2005 through 2007. These projections are based in part on an assumption that more favorable underwriting conditions existed in 2008 and 2009 than in 2005-2007, including tighter loan underwriting standards and lower housing prices. Current claims data from both policy years 2008 and 2009, while still at an early stage of development, supports this assumption.

A summary of the Company’s loss reserves, broken down into its components of known title claims, incurred but not reported claims and non-title claims, follows:

(in thousands except percentages)	December 31, 2009				December 31, 2008
Known title claims	$	206,439	16.4	%	$	234,311	17.3	%
IBNR		978,854	78.0	%		1,035,779	76.4	%
Total title claims		1,185,293	94.4	%		1,270,090	93.7	%
Non-title claims		69,795	5.6	%		85,302	6.3	%
Total loss reserves	$	1,255,088	100.0	%	$	1,355,392	100.0	%

95

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 11.    Notes and Contracts Payable:

	December 31
	2009		2008
	(in thousands)
5.7% senior debentures, due August 2014	$	149,808	$	149,766
7.55% senior debentures, due April 2028		99,662		99,644
Line of credit borrowings due July 2012, weighted average interest rate of 1.43%		340,000		340,000
1.37% First Advantage line of credit, due September 2010		—		15,000
Trust deed notes with maturities through 2032, collateralized by land and buildings with a net book value of $40,520, weighted-average interest rate of 5.24%		50,403		52,081
Other notes and contracts payable with maturities through 2017, weighted-average interest rate of 5.54%		151,210		211,783
	$	791,083	$	868,274

In November 2005, the Company amended its $500.0 million credit agreement that was originally entered into in August 2004. The November 2005 amendment extended the expiration date to November 2010 and permitted the Company to increase the credit amount to $750.0 million under certain circumstances. In July 2007, the credit agreement was further amended to extend the expiration date to July 2012. In November 2009, the credit agreement was again amended to allow for the acquisition of the remaining noncontrolling interest in First Advantage. Under the credit agreement the Company is required to maintain certain minimum levels of capital and earnings and meet predetermined debt-to-capitalization ratios. The line of credit had a balance due of $340.0 million at December 31, 2009. At December 31, 2009, the Company is in compliance with the debt covenants under the amended and restated credit agreement.

First Advantage had one bank credit agreement which was terminated upon consummation of the buy-in transaction in the fourth quarter of 2009. This agreement provided for a $225.0 million revolving line of credit and was collateralized by the stock and accounts receivable of First Advantage’s subsidiaries. The line of credit was to remain in effect until September 2010. Under the terms of the credit agreement, First Advantage was required to satisfy certain financial requirements. At December 31, 2008, First Advantage was in compliance with the financial covenants of its loan agreement except for the consolidated to fixed charge coverage ratio for the quarter ended December 31, 2008. Compliance with this covenant was waived by the required lenders.

In December 2007, First American CoreLogic entered into a $100.0 million secured financing arrangement with Banc of America Leasing & Capital, LLC. Borrowings under the arrangement are secured by the capitalized software and data of First American CoreLogic and are guaranteed by FARES. The outstanding balance at December 31, 2009 totaled $64.2 million.

In July 2004, the Company sold unsecured debt securities in the aggregate principal amount of $150.0 million. These securities, which bear interest at a fixed rate of 5.7%, are due August 2014.

In April 1998, the Company issued and sold $100.0 million of 7.55% senior debentures, due April 2028. The 30-year bonds were issued at 99.456% of the principal amount.

The weighted-average interest rate for the Company’s notes and contracts payable was 4.0% and 5.3% at December 31, 2009 and 2008, respectively.

96

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The aggregate annual maturities for notes and contracts payable in each of the five years after December 31, 2009, are as follows:

Year	Notes and contracts payable
	(in thousands)
2010	$	73,052
2011	$	43,146
2012	$	372,140
2013	$	5,900
2014	$	161,672

NOTE 12.    Deferrable Interest Subordinated Notes:

On April 22, 1997, the Company issued and sold $100.0 million of 8.5% trust preferred securities, due in 2012, through its wholly-owned subsidiary, First American Capital Trust. In connection with the subsidiary’s issuance of the preferred securities, the Company issued to the subsidiary trust 8.5% subordinated interest notes due in 2012. The sole assets of the subsidiary are and will be the subordinated interest notes. The Company’s obligations under the subordinated interest notes and related agreements, taken together, constitute a full and unconditional guarantee by the Company of the subsidiary’s obligations under the preferred securities. Distributions on the securities are included as interest expense in the Company’s consolidated statements of income.

NOTE 13.    Investment and Other Income:

The components of investment and other income are as follows:

	Year ended December 31,
	2009		2008		2007
	(in thousands)
Interest:
Cash equivalents and deposits with savings and loan associations and banks	$	18,805	$	54,193	$	109,632
Debt securities		48,015		57,516		67,976
Other long-term investments		2,199		22,456		53,184
Loans receivable		10,711		9,055		8,556
Dividends on marketable equity securities		5,041		5,405		6,770
Equity in earnings of unconsolidated affiliates		91,389		44,762		47,708
Trust and banking activities		12,834		23,032		13,870
Other		22,572		15,862		12,374
	$	211,566	$	232,281	$	320,070

NOTE 14.    Income Taxes:

For the years ended December 31, 2009, 2008 and 2007, domestic and foreign pretax income from continuing operations was $407.4 million and $16.4 million, $23.2 million and $21.0 million and $99.8 million and $52.3 million, respectively.

97

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Income taxes are summarized as follows:

	2009		2008			2007
	(in thousands)
Current:
Federal	$	13,335	$	26,039		$	89,327
State		13,805		18,841			12,658
Foreign		14,927		12,687			22,551
		42,067		57,567			124,536
Deferred:
Federal		99,936		(36,793	)		(86,189	)
State		8,051		2,377			6,780
Foreign		4,567		(7,305	)		(1,438	)
		112,554		(41,721	)		(80,847	)
	$	154,621	$	15,846		$	43,689

Income taxes differ from the amounts computed by applying the federal income tax rate of 35.0%. A reconciliation of this difference is as follows:

	2009			2008			2007
	(in thousands)
Taxes calculated at federal rate	$	148,327		$	15,474		$	53,222
State taxes, net of federal benefit		14,292			13,792			12,635
Foreign taxes in excess of (less than) federal rate		12,967			(450	)		(2,077	)
Exclusion of certain meals and entertainment expenses		3,162			4,494			5,981
Goodwill impairment		—			6,778			—
Dividends received deduction		(2,056	)		(1,846	)		(1,288	)
Change in liability for income taxes associated with uncertain tax positions		(8,206	)		(9,961	)		8,892
Tax effect of noncontrolling interests		(17,875	)		(13,446	)		(23,230	)
Other items, net		4,010			1,011			(10,446	)
	$	154,621		$	15,846		$	43,689

The Company’s effective income tax rate (income tax expense as a percentage of income before income taxes), was 36.5% for 2009, 35.8% for 2008 and 28.7% for 2007. The effective income tax rate includes a provision for state income and franchise taxes for noninsurance subsidiaries. The absolute differences in the effective tax rates for 2009 and 2008 were primarily due to changes in the ratio of permanent differences to income before income taxes and changes in state income and franchise taxes resulting from fluctuations in the Company’s noninsurance subsidiaries’ contribution to pretax profits. In addition, certain interest and penalties relating to uncertain tax positions were released during the year based on changes in facts and circumstances associated with the related tax uncertainty. The changes in the liability for income taxes associated with uncertain tax positions in 2009 and 2008 relate primarily to statutes of limitation closures and a foreign transfer pricing matter impacted by recent administrative and judicial developments, respectively. The Company continues to monitor the realizability of recognized, impairment and unrecognized losses recorded through December 31, 2009. The Company believes it is more likely than not that the tax benefits associated with those losses will be realized. However, this determination is a judgment and could be impacted by further market fluctuations. A

98

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

large portion of the Company’s income attributed to noncontrolling interests is related to a limited liability company subsidiary, which for tax purposes, is treated as a partnership. Accordingly, no income taxes have been provided for that portion of the income attributable to noncontrolling interests.

The primary components of temporary differences that give rise to the Company’s net deferred tax asset are as follows:

	December 31
	2009			2008
	(in thousands)
Deferred tax assets:
Deferred revenue	$	117,983		$	117,440
Employee benefits		98,052			99,780
Bad debt reserves		26,351			26,796
Loss reserves		47,175			77,618
Claims and related salvage		(18,549	)		49,414
Pension		116,674			105,269
Loss on investments		(61	)		48,380
Capital loss carryforward		30,264			27,143
Net operating loss carryforwards		43,766			39,679
Other		31,007			25,748
		492,662			617,267
Deferred tax liabilities:
Depreciable and amortizable assets		401,416			384,185
Investment in affiliates		32,569			36,890
Other		5,504			17,804
		439,489			438,879
Net deferred tax asset before valuation allowance		53,173			178,388
Valuation allowance		(39,918	)		(28,915	)
Net deferred tax asset	$	13,255		$	149,473

The exercise of stock options represents a tax benefit and has been reflected as a reduction of taxes payable and an increase to the additional paid-in capital account. The benefits recorded were $0.1 million, $0.0 million and $10.6 million for the years ended December 31, 2009, 2008 and 2007, respectively.

At December 31, 2009, the Company had available federal, state and foreign net operating loss carryforwards totaling, in aggregate, approximately $219.6 million for income tax purposes, of which $37.8 million has an indefinite expiration. The remaining $181.8 million expire at various times beginning in 2010. Available foreign tax credit carryforwards of $12.7 million at December 31, 2009 expire at various times beginning in 2014.

The Company has a capital loss carryforward of $86.5 million that expires in 2013. In addition, the Company has impairment and unrealized capital losses of $84.0 million which includes $35.6 million of unrealized losses related to debt securities that the Company has the ability and intent to hold to recovery. The Company continues to monitor the realizability of these losses and believes it is more likely than not that the tax benefits associated with these losses will be realized. In making that determination the Company identified certain prudent and feasible tax planning strategies that it will implement unless the need to do so is eliminated in the future. However, this determination is a judgment and could be impacted by further market fluctuations.

99

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The valuation allowance relates to deferred tax assets for federal and state net operating loss carryforwards relating to acquisitions consummated by First Advantage, foreign operations of the Company, and foreign tax credits. Utilization of the pre-acquisition net operating losses is subject to limitations by the Internal Revenue Code and State jurisdictions. The Company evaluates the realizability of its deferred tax assets by assessing the valuation allowance and by adjusting the amount of such allowance, if necessary. The factors used to assess the likelihood of realization are the Company’s forecast of future taxable income and available tax planning strategies that could be implemented to realize the net deferred tax assets. Failure to achieve the forecasted taxable income in the applicable taxing jurisdictions could affect the ultimate realization of deferred tax assets and could result in an increase in the Company’s effective tax rate on future earnings. The increase in the valuation allowance primarily results from current year losses from foreign subsidiaries and unutilized foreign tax credits.

As of December 31, 2009, United States taxes were not provided for on the earnings of the Company’s foreign subsidiaries of $125.4 million, as the Company has invested or expects to invest the undistributed earnings indefinitely. If in the future these earnings are repatriated to the United States, or if the Company determines that the earnings will be remitted in the foreseeable future, additional tax provisions may be required. It is not practical to calculate the deferred taxes associated with these earnings; however foreign tax credits may be available to reduce federal income taxes in the event of distribution.

As of December 31, 2009, the liability for income taxes associated with uncertain tax positions was $21.4 million. This liability can be reduced by $4.6 million of offsetting tax benefits associated with the correlative effects of potential adjustments including state income taxes and timing adjustments. The net amount of $16.8 million, if recognized, would favorably affect the Company’s effective tax rate.

A reconciliation of the beginning and ending amount of unrecognized tax benefits for the years ended December 31, 2009, 2008 and 2007 is as follows:

	2009			2008			2007
	(in thousands)
Unrecognized tax benefits—opening balance	$	28,200		$	33,900		$	95,700
Gross increases—tax positions in prior period		—			200			—
Gross decreases—tax positions in prior period		(700	)		(5,100	)		(65,500	)
Gross increases—current period tax positions		2,600			3,900			8,100
Settlements with taxing authorities		(800	)		—			—
Expiration of the statute of limitations for the assessment of taxes		(7,900	)		(4,700	)		(4,400	)
Unrecognized tax benefits—ending balance	$	21,400		$	28,200		$	33,900

The Company’s continuing practice is to recognize interest and penalties, if any, related to uncertain tax positions in tax expense. As of December 31, 2009 and 2008, the Company had accrued $4.1 million and $4.6 million, respectively, of interest and penalties (net of tax benefits of $1.3 million and $1.6 million, respectively,) related to uncertain tax positions.

The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, various state jurisdictions, and various non-U.S. jurisdictions. The primary non-federal jurisdictions are California, Florida, New York, Texas, and Canada. The Company is no longer subject to U.S. federal, state, and non-U.S. income tax examinations by taxing authorities for years prior to 2005.

100

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

It is reasonably possible that the amount of the unrecognized benefit with respect to certain of the Company’s unrecognized tax positions may significantly increase or decrease within the next 12 months. These changes may be the result of items such as ongoing audits, competent authority proceedings related to transfer pricing or the expiration of federal and state statute of limitations for the assessment of taxes. The Company estimates that decreases in unrecognized tax benefits within the next 12 months will total approximately $5.0 million.

The Company records a liability for potential tax assessments based on its estimate of the potential exposure. New tax laws and new interpretations of laws and rulings by tax authorities may affect the liability for potential tax assessments. Due to the subjectivity and complex nature of the underlying issues, actual payments or assessments may differ from estimates. To the extent the Company’s estimates differ from actual payments or assessments, income tax expense is adjusted. The Company’s income tax returns in several jurisdictions are being examined by various tax authorities. Management believes that adequate amounts of tax and related interest, if any, have been provided for any adjustments that may result from these examinations.

NOTE 15.    Earnings (Loss) Per Share:

The Company’s potential dilutive securities are stock options and RSUs. Stock options and RSUs are reflected in diluted net income (loss) per share attributable to FAC stockholders by application of the treasury-stock method. There are no reconciling items for net income (loss) attributable to FAC for the three years ended December 31, 2009, necessary for the diluted net income (loss) per share attributable to FAC stockholders calculation. A reconciliation of weighted-average shares outstanding is as follows:

	2009		2008			2007
	(in thousands, except per share data)
Numerator for basic and diluted net income (loss) per share attributable to FAC stockholders:
Net income (loss) attributable to FAC	$	199,651	$	(26,320	)	$	(3,119	)
Denominator for basic net income (loss) per share attributable to FAC stockholders:
Weighted-average shares		94,551		92,516			94,649
Effect of dilutive securities:
Employee stock options and restricted stock units		927		—			—
Denominator for diluted net income (loss) per share attributable to FAC stockholders		95,478		92,516			94,649
Net income (loss) per share attributable to FAC stockholders:
Basic	$	2.11	$	(0.28	)	$	(0.03	)
Diluted	$	2.09	$	(0.28	)	$	(0.03	)

For the year ended December 31, 2009, 3.7 million options were excluded from the weighted-average diluted common shares outstanding due to their antidilutive effect. For the years ended December 31, 2008 and December 31, 2007, 4.0 million and 4.5 million potential dilutive shares of common stock (representing all potential dilutive shares), respectively, were excluded due to the net loss for the periods.

101

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 16.    Employee Benefit Plans:

The Company has benefit plans covering substantially all employees, including a 401(k) savings plan (the “Savings Plan”), an employee stock purchase plan, defined benefit pension plan and a deferred compensation plan.

The Savings Plan allows for employee-elective contributions up to the maximum deductible amount as determined by the Internal Revenue Code. The Company makes discretionary contributions to the Savings Plan based on profitability, as well as contributions of the participants. The Company’s expense related to the Savings Plan amounted to $22.7 million, $0.0 million and $34.0 million for the years ended December 31, 2009, 2008 and 2007, respectively. There was no contribution or expense for the year ended December 31, 2008 related to the Company’s Savings Plan as a result of the determination that the Company did not meet the requirement for a profit driven 401(k) match. The Savings Plan allows the participants to purchase the Company’s stock as one of the investment options, subject to certain limitations. The Savings Plan held 6,790,000 and 7,312,000 shares of the Company’s common stock, representing 6.6% and 7.9% of the total shares outstanding at December 31, 2009 and 2008, respectively.

The employee stock purchase plan allows eligible employees to purchase common stock of the Company at 85.0% of the closing price on the last day of each month. There were 208,000, 251,000 and 235,000 shares issued in connection with the plan for the years ended December 31, 2009, 2008 and 2007, respectively. At December 31, 2009, there were 1,046,000 shares reserved for future issuances.

The Company’s defined benefit pension plan is a noncontributory, qualified, defined benefit plan with benefits based on the employee’s compensation and years of service. The defined benefit pension plan was closed to new entrants effective December 31, 2001 and amended to “freeze” all benefit accruals as of April 30, 2008. The Company’s policy is to fund all accrued pension costs. Contributions are intended to provide not only for benefits attributable to past service, but also for those benefits expected to be earned in the future. The Company also has nonqualified, unfunded supplemental benefit plans covering certain key management personnel.

The Company amended and restated the Executive and Management Supplemental Benefit Plans on November 1, 2007. The period over which compensation that is used to determine the benefit level was changed from the average of the three highest years out of the ten years preceding retirement to the average of the last five calendar years preceding retirement. The maximum benefit under the executive plan is now 30% and remains at 15% under the management plan. Under both plans, the maximum benefits are now attained at age 62.

The Company has a deferred compensation plan that allows participants to defer up to 100% of their salary, commissions and bonus. Participants allocate their deferrals among a variety of investment crediting options (known as “deemed investments”). Deemed investments mean that the participant has no ownership interest in the funds they select; the funds are only used to measure the gains or losses that will be attributed to their deferral account over time. Participants can elect to have their deferral balance paid out in a future year while they are still employed or after their employment ends. The deferred compensation plan is exempt from most provisions of ERISA because it is only available to a select group of management and highly compensated employees and is not a qualified employee benefit plan. To preserve the tax-deferred savings advantages of a nonqualified deferred compensation plan, federal law requires that it be an unfunded or informally funded future promise to pay. The participants’ deferrals and any earnings on those deferrals are general unsecured obligations of the Company. The Company is informally funding the deferred compensation plan through a tax-advantaged investment known as variable universal life insurance. Deferred compensation plan assets are held as a Company asset within a

102

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

special trust, called a “Rabbi Trust.” The value of the assets in the Rabbi Trust at December 31, 2009 and 2008 is $88.6 million and $78.0 million, respectively, and is included in other assets in the consolidated balance sheets. The unfunded liability for the deferred compensation plan at December 31, 2009 and 2008 is $89.9 million and $78.0 million, respectively, and is included in pension costs and other retirement plans in the consolidated balance sheets.

The following table summarizes the balance sheet impact, including benefit obligations, assets and funded status associated with the defined benefit pension plans and supplemental benefit plans as of December 31, 2009 and 2008:

	December 31
	2009						2008
	Defined benefit pension plans			Unfunded supplemental benefit plans			Defined benefit pension plans			Unfunded supplemental benefit plans
	(in thousands)
Change in projected benefit obligation:
Benefit obligation at beginning of year	$	314,657		$	241,528		$	312,400		$	237,903
Service costs		—			5,989			359			6,009
Interest costs		19,538			15,306			19,066			15,080
Actuarial losses (gains)		24,150			7,376			1,748			(7,400	)
Benefits paid		(15,428	)		(11,568	)		(18,916	)		(10,064	)
Projected benefit obligation at end of year		342,917			258,631			314,657			241,528
Change in plan assets:
Plan assets at fair value at beginning of year		201,280			—			283,236			—
Actual return on plan assets		42,634			—			(80,817	)		—
Company contributions		12,292			11,568			17,777			10,064
Benefits paid		(15,428	)		(11,568	)		(18,916	)		(10,064	)
Plan assets at fair value at end of year		240,778			—			201,280			—
Reconciliation of funded status:
Unfunded status of the plans	$	(102,139	)	$	(258,631	)	$	(113,377	)	$	(241,528	)
Amounts recognized in the consolidated balance sheet consist of:
Accrued benefit liability	$	(102,139	)	$	(258,631	)	$	(113,377	)	$	(241,528	)
	$	(102,139	)	$	(258,631	)	$	(113,377	)	$	(241,528	)
Amounts recognized in accumulated other comprehensive income (loss):
Unrecognized net actuarial loss	$	196,112		$	107,936		$	205,189		$	109,762
Unrecognized prior service cost (credit)		140			(13,031	)		165			(14,347	)
	$	196,252		$	94,905		$	205,354		$	95,415

103

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Net periodic pension cost for the three years ended December 31, 2009, for the Company’s defined benefit pension and supplemental benefit plans includes the following components:

	2009			2008			2007
	(in thousands)
Expense:
Service costs	$	6,049		$	6,428		$	11,287
Interest costs		34,845			34,146			34,340
Expected return on plan assets		(20,176	)		(25,814	)		(23,162	)
Amortization of net loss		19,956			13,541			18,791
Amortization of prior service (credit) cost		(1,291	)		(1,291	)		26
Curtailment loss		—			—			1
	$	39,383		$	27,010		$	41,283

The estimated net loss and prior service credit for pension benefits that will be amortized from accumulated other comprehensive loss into net periodic pension cost over the next fiscal year are expected to be $24.1 million and $1.3 million, respectively.

Weighted-average actuarial assumptions used to determine costs for the plans were as follows:

	December 31
	2009		2008
Defined benefit pension plan
Discount rate	6.30	%	6.30	%
Rate of return on plan assets	8.00	%	9.00	%
Unfunded supplemental benefit plans
Discount rate	6.30	%	6.30	%

Weighted-average actuarial assumptions used to determine benefit obligations for the plans were as follows:

	December 31
	2009		2008
Defined benefit pension plan
Discount rate	5.81	%	6.30	%
Unfunded supplemental benefit plans
Discount rate	5.81	%	6.30	%
Salary increase rate	5.00	%	5.00	%

The discount-rate assumption used for pension plan accounting reflects the yield available on high-quality, fixed-income debt securities that match the expected timing of the benefit obligation payments.

Assumptions for the expected long-term rate of return on plan assets are based on future expectations for returns for each asset class based on the calculated market-related value of plan assets and the effect of periodic target asset allocation rebalancing, adjusted for the payment of reasonable expenses of the plan from plan assets. The expected long-term rate of return on assets was selected from within a reasonable range of rates determined by (1) historical real and expected returns for the asset classes covered by the investment policy and (2) projections of inflation over the long-term period during which benefits are payable to plan participants. The

104

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Company believes its assumptions are appropriate based on the investment mix and long-term nature of the plan’s investments. The use of expected long-term returns on plan assets may result in recognized pension income that is greater or less than the actual returns of those plan assets in any given year. Over time, however, the expected long-term returns are designed to approximate the actual long-term returns, and therefore result in a pattern of income and cost recognition that more closely matches the pattern of the services provided by the employees.

The following table provides the funded status in the defined benefit pension plans and supplemental benefit plans as of December 31, 2009 and 2008:

	December 31
	2009				2008
	Defined benefit pension plans		Unfunded supplemental benefit plans		Defined benefit pension plans		Unfunded supplemental benefit plans
	(in thousands)
Projected benefit obligation	$	342,917	$	258,631	$	314,657	$	241,528
Accumulated benefit obligation	$	342,917	$	225,389	$	314,657	$	207,214
Plan assets at fair value at end of year	$	240,778	$	—	$	201,280	$	—

The Company has a pension investment policy designed to meet or exceed the expected rate of return on plan assets assumption. The investment objective is balanced growth which requires investments for income and capital appreciation, with a slight bias toward capital appreciation. To achieve this, the pension plan assets are managed by investment managers that invest plan assets in equity and fixed income debt securities and cash. Sufficient liquidity is also maintained to provide cash flow for ongoing needs

Cash investments may be made in short-term securities, such as commercial paper or variable rate notes, or in money market funds. The short-term securities are investment grade with a maturity of less than 13 months. Fixed income investments must be government or government agency obligations, corporate debt or preferred stock, or fixed income mutual funds. The corporate debt are investment grade. Common stock investments may be either individual issues or stock mutual funds. The Company’s pension investment policy prohibits the use of the following financial instruments: options, short sales, commodities, derivatives, letter stock, private or direct placements and margin purchases. At December 31, 2009 and 2008, the Company’s pension plan assets also include $5.7 million and $5.1 million, respectively, of investment contracts with insurance companies as part of an acquired plan.

A summary of the asset allocation as of December 31, 2009 and 2008 and the target mix are as follows:

	Target allocation		Percentage of plan assets at December 31
	2010		2009		2008
Asset category
Domestic and international equities	65.0	%	66.0	%	57.1	%
Fixed income	33.0	%	31.7	%	42.4	%
Cash	2.0	%	2.3	%	0.5	%

From time to time, market conditions may cause the portfolio’s investment in various asset classes to deviate from the target asset allocation. To remain consistent with these target asset allocations, the investment manager reviews the portfolio quarterly and rebalances the portfolio if necessary.

105

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The Company expects to make cash contributions to its pension plans of approximately $34.8 million during 2010.

The following benefit payments for all plans, which reflect expected future service, as appropriate, are expected to be paid as follows:

Year	(in thousands)
2010	$	28,434
2011	$	29,397
2012	$	30,949
2013	$	32,546
2014	$	33,731
2015-2019	$	188,790

The Company determines the fair value of its defined benefit pension plans assets with a three-level hierarchy for fair value measurements that distinguishes between market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs) and the reporting entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The hierarchy level assigned to each security in the Company’s defined benefit pension plan assets is based on management’s assessment of the transparency and reliability of the inputs used in the valuation of such instrument at the measurement date. See Note 1 Description of the Company to the consolidated financial statements for a more in-depth discussion on the fair value hierarchy and a description for each level.

The following table presents the Company’s defined benefit pension plan assets measured at fair value on a recurring basis as of December 31, 2009 and 2008, classified using the fair value hierarchy:

	Estimated fair value as of December 31, 2009		Level 1		Level 2
	(in thousands)
Cash and cash equivalents	$	5,338	$	5,338	$	—
Debt securities:
Municipal bonds		8,688		—		8,688
Foreign bonds		3,820		—		3,820
Governmental agency mortgage-backed securities		31,322		—		31,322
Corporate debt securities		25,362		—		25,362
		69,192		—		69,192
Equity securities:
Preferred stocks		3,865		3,865		—
Domestic common stocks		126,561		126,561		—
International common stocks		30,087		30,087		—
		160,513		160,513		—
Investment contract with insurance companies		5,735		—		5,735
	$	240,778	$	165,851	$	74,927

106

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

	Estimated fair value as of December 31, 2008		Level 1		Level 2
	(in thousands)
Cash and cash equivalents	$	1,052	$	1,052	$	—
Debt securities:
Municipal bonds		11,047		—		11,047
Governmental agency mortgage-backed securities		30,566		—		30,566
Corporate debt securities		39,840		—		39,840
		81,453		—		81,453
Equity securities:
Preferred stocks		152		152		—
Domestic common stocks		91,125		91,125		—
International common stocks		22,350		22,350		—
		113,627		113,627		—
Investment contract with insurance companies		5,148		—		5,148
	$	201,280	$	114,679	$	86,601

The Company’s defined benefit pension plans had no securities at December 31, 2009 and 2008 that were valued at Level 3 of the fair value hierarchy.

NOTE 17.    Fair Value of Financial Instruments:

Guidance requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practical to estimate that value. In the measurement of the fair value of certain financial instruments, other valuation techniques were utilized if quoted market prices were not available. These derived fair value estimates are significantly affected by the assumptions used. Additionally, the guidance excludes certain financial instruments including those related to insurance contracts.

In estimating the fair value of the financial instruments presented, the Company used the following methods and assumptions:

Cash and cash equivalents

The carrying amount for cash and cash equivalents is a reasonable estimate of fair value due to the short-term maturity of these investments.

Accounts and accrued income receivable, net

The carrying amount for accounts and accrued income receivable, net is a reasonable estimate of fair value due to the short-term maturity of these assets.

Investments

The carrying amount of deposits with savings and loan associations and banks is a reasonable estimate of fair value due to their short-term nature.

107

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The methodology for determining the fair value of debt and equity securities is discussed in Note 1 Description of the Company to the consolidated financial statements.

As other long-term investments are not publicly traded, reasonable estimate of the fair values could not be made without incurring excessive costs. The cost basis is used as a proxy for fair value.

Loans receivable, net

The fair value of loans receivable, net was estimated based on the discounted value of the future cash flows using the current rates being offered for loans with similar terms to borrowers of similar credit quality.

Demand Deposits

The carrying value of escrow and passbook accounts approximates fair value due to the short-term nature of these liabilities. The fair value of investment certificate accounts was estimated based on the discounted value of future cash flows using a discount rate approximating current market rates for similar liabilities.

Accounts payable and accrued liabilities

The carrying amount for accounts payable and accrued liabilities is a reasonable estimate of fair value due to the short-term maturity of these liabilities.

Notes and contracts payable

The fair value of notes and contracts payable was estimated based on the current rates offered to the Company for debt of the same remaining maturities.

Deferrable interest subordinated notes

The fair value of the Company’s deferrable interest subordinated notes was estimated based on the current rates offered to the Company for debt of the same type and remaining maturity.

108

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The carrying amounts and fair values of the Company’s financial instruments as of December 31, 2009 and 2008 are presented in the following table.

	December 31
	2009				2008
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in thousands)
Financial Assets:
Cash and cash equivalents	$	982,448	$	982,448	$	934,945	$	934,945
Accounts and accrued income receivable, net	$	491,539	$	491,539	$	558,946	$	558,946
Investments:
Deposits with savings and loan associations and banks	$	124,553	$	124,553	$	182,117	$	182,117
Debt securities	$	1,868,413	$	1,868,413	$	1,718,320	$	1,718,320
Equity securities	$	99,167	$	99,167	$	110,126	$	110,126
Other long-term investments	$	374,862	$	374,862	$	371,157	$	371,157
Loans receivable, net	$	161,897	$	165,130	$	151,692	$	167,532
Financial Liabilities:
Demand deposits	$	1,153,574	$	1,154,210	$	1,298,221	$	1,298,602
Accounts payable and accrued liabilities	$	1,085,031	$	1,085,031	$	1,072,108	$	1,072,108
Notes and contracts payable	$	791,083	$	747,711	$	868,274	$	778,009
Deferrable interest subordinated notes	$	100,000	$	108,992	$	100,000	$	102,054

NOTE 18.    Share-Based Compensation Plans:

On April 24, 1996, the Company implemented The First American Corporation 1996 Stock Option Plan (the “Stock Option Plan”). Under the Stock Option Plan, options were granted to certain employees to purchase the Company’s common stock. The maximum number of shares under the Stock Option Plan subject to options was 14,625,000. Outstanding options become exercisable in one to five years from the date of the grant, and expire ten years from the grant date. On April 24, 1997, the Company implemented The First American Corporation 1997 Directors’ Stock Plan (the “Directors’ Plan”). The Directors’ Plan is similar to the employees’ Stock Option Plan, except that the maximum number of shares that may be subject to options was 1,800,000 and the maximum number of shares that may be purchased pursuant to options granted shall not exceed 6,750 shares during any consecutive 12-month period.

On May 18, 2006, the Company’s shareholders voted to approve the Company’s 2006 Incentive Compensation Plan (the “Incentive Compensation Plan”), which was previously approved by the Board of Directors. The Stock Option Plan and the Director’s Plan were terminated and replaced by the Incentive Compensation Plan. Eligible participants in the Incentive Compensation Plan include the Company’s directors and executive officers, as well as other employees of the Company and certain of its affiliates. The Incentive Compensation Plan permits the grant of stock options, stock appreciation rights, restricted stock, RSUs, performance units, performance shares and other stock-based awards. Under the terms of the Incentive Compensation Plan, 4,700,000 Company Common shares can be awarded from authorized but unissued shares, subject to certain annual limits on the amounts that can be awarded based on the type of award granted. The Incentive Compensation Plan terminates 10 years from the effective date unless cancelled prior to that date by the Company’s Board of Directors.

109

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following table presents the share-based compensation expense recognized for the three years ended December 31, 2009, 2008 and 2007:

	2009		2008		2007
	(in thousands)
Expense:
Stock options	$	2,390	$	588	$	7,847
Restricted stock units		20,817		12,763		9,320
Employee stock purchase plan		860		1,128		1,511
	$	24,067	$	14,479	$	18,678

In addition to the share-based compensation above, the Company’s consolidated financial statements include share-based compensation related to First Advantage, of $15.5 million, $9.3 million and $13.3 million for the years ended December 31, 2009, 2008 and 2007. In addition to the share-based compensation above and the share-based compensation related to First Advantage, the Company’s consolidated financial statements include share-based compensation related to the Company’s subsidiary, First American CoreLogic Holdings, Inc., of $1.2 million for both the years ended December 31, 2009 and 2008.

On November 18, 2009, the Company consummated the buy-in of the publicly held shares of First Advantage. See further discussion at Note 24 Business Combinations and Divestitures to the consolidated financial statements. This transaction constituted a “Change in Control” under the First Advantage 2003 Incentive Compensation Plan. Upon a Change in Control, the unvested awards of stock options, restricted stock and RSUs issued under the First Advantage 2003 Incentive Compensation Plan vested and the unamortized costs of those awards was expensed. For the year ended December 31, 2009, the additional compensation expense was approximately $8.4 million and $0.7 million related to the unvested restricted stock and RSUs and unvested stock options, respectively. First Advantage’s vested restricted stock and RSUs were distributed as shares of First American common stock. The ratio used to convert the stock options, restricted stock and RSUs was the same per-share ratio used in the exchange offer of 0.58 of a First American common stock. As of December 31, 2009, 0.4 million shares of First American common stock were issued for vested restricted stock and RSUs and 1.8 million stock options were granted in exchange for First Advantage outstanding stock options. As of December 31, 2009, there were no outstanding stock options, restricted stock or RSUs under the First Advantage share-based plan.

110

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

The following table summarizes stock option activity related to the Company’s plans:

	Number outstanding		Weighted- average exercise price		Weighted- average remaining contractual term	Aggregate intrinsic value
	(in thousands, except weighted- average exercise price)
Balance at December 31, 2008	3,050		$	30.59
Granted during 2009 in connection with First Advantage acquisition	1,792		$	39.69
Exercised during 2009	(410	)	$	18.12
Forfeited during 2009	(157	)	$	38.08
Balance at December 31, 2009	4,275		$	35.26	4.5	$	13,182
Vested and expected to vest at December 31, 2009	4,271		$	35.25	4.5	$	13,182
Exercisable at December 31, 2009	4,071		$	34.86	4.5	$	13,182

As of December 31, 2009, there was $0.6 million of total unrecognized compensation cost related to unvested stock options of the Company that is expected to be recognized over a weighted-average period of 1.0 year. Cash received from the exercise of stock options for the year ended December 31, 2009, 2008 and 2007 totaled $8.8 million, $14.4 million and $42.2 million, respectively.

Total intrinsic value of options exercised for the year ended December 31, 2009, 2008 and 2007 was $4.9 million, $7.6 million and $39.2 million, respectively. This intrinsic value represents the difference between the fair market value of the Company’s common stock on the date of exercise and the exercise price of each option.

As of December 31, 2009, there was $27.5 million of total unrecognized compensation cost related to nonvested RSUs that is expected to be recognized over a weighted-average period of 3.6 years. The fair value of RSUs is based on the market value of the Company’s shares on the date of grant. The total fair value of shares vested and not distributed on December 31, 2009 is $4.0 million. RSU activity for the year ended December 31, 2009, is as follows:

	Shares		Weighted- average grant-date fair value
	(in thousands, except weighted- average grant-date fair value)
Nonvested RSUs outstanding at December 31, 2008	981		$	37.32
Granted during 2009	1,127		$	26.40
Vested during 2009	(385	)	$	35.77
Forfeited during 2009	(55	)	$	32.17
Nonvested RSUs outstanding at December 31, 2009	1,668		$	30.48

111

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 19.    Commitments and Contingencies:

Lease Commitments

The Company leases certain office facilities, automobiles and equipment under operating leases, which, for the most part, are renewable. The majority of these leases also provide that the Company will pay insurance and taxes.

Future minimum rental payments under operating and capital leases that have initial or remaining noncancelable lease terms in excess of one year as of December 31, 2009 are as follows:

	Operating
	(in thousands)
Year
2010	$	153,512
2011		115,701
2012		81,778
2013		56,702
2014		37,857
Later years		65,169
	$	510,719

Total rental expense for all operating leases and month-to-month rentals was $232.7 million, $281.9 million and $291.0 million for the years ended December 31, 2009, 2008 and 2007, respectively.

Other commitments and guarantees

The Company also guarantees the obligations of certain of its subsidiaries. These obligations are included in the Company’s consolidated balance sheets as of December 31, 2009.

NOTE 20.    Redeemable Noncontrolling Interests:

Noncontrolling interests that are redeemable at the option of the holder are classified as redeemable noncontrolling interests in the mezzanine section of the Company’s consolidated balance sheet between liabilities and stockholders’ equity. Redeemable noncontrolling interests are reported at their estimated redemption value in each reporting period, but not less than their initial fair value. Any adjustments to the redemption value impacts additional paid-in capital.

On December 31, 2009, the Company entered into agreements with Experian that provide for: (i) amending Experian’s right to sell to the Company (the “put”), and the Company’s right to purchase from Experian (the “call”), the membership interest in FARES held by Experian to provide that, if exercised in 2010, the exercise price will be $313.8 million in cash; (ii) the fixing of the closing date of any put or call as the last business day of the year in which the put or call is exercised or if exercised in December, on any business day in the following January as determined by the Company; and (iii) the ability of the Company to amend the operating agreement governing the joint venture following the exercise of the put or call subject to certain specified exceptions. As Experian’s right to exercise its put is outside of the Company’s control, the contractual obligation of $313.8 million is included as redeemable noncontrolling interest in the accompanying consolidated balance sheet.

112

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Additionally, the Company has an agreement with the owners of the noncontrolling interest holders in a subsidiary of FARES whereby the owners can put their ownership interest back to the Company at fair value, as defined by the operating agreement. The Company included the estimated liability associated with this put right as redeemable noncontrolling interests in the accompanying consolidated balance sheet at December 31, 2009.

NOTE 21.    Stockholders’ Equity:

On May 18, 2004, the Company announced that its Board of Directors adopted a plan authorizing the repurchase of $100 million of its common shares. On May 19, 2005, the Company announced an amendment to this plan increasing the amount of shares that the Company may repurchase to $200 million. On June 26, 2006, the Company announced a further amendment to this plan, increasing the amount of shares that may be repurchased to $500 million. On January 15, 2008, the Board of Directors authorized an additional $300 million of repurchase capacity. Under this plan, which has no expiration date, the Company may repurchase up to $800 million of the Company’s issued and outstanding Common shares. Between inception of the plan and December 31, 2007, the Company had repurchased and retired 10.5 million of its common shares for a total purchase price of $439.6 million and has the authority to repurchase an additional $360.4 million. The Company did not repurchase any shares in 2009 and 2008.

NOTE 22.    Other Comprehensive Income (Loss):

Comprehensive income is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income.

Components of other comprehensive income (loss) are as follows:

	Net unrealized gains (losses) on securities			Foreign currency translation adjustment			Pension benefit adjustment			Accumulated other comprehensive income (loss)
	(in thousands)
Balance at December 31, 2006	$	(5,777	)	$	9,488		$	(178,995	)	$	(175,284	)
Pretax change		66,092			15,781			63,337			145,210
Tax effect		(23,492	)		—			(22,167	)		(45,659	)
Balance at December 31, 2007		36,823			25,269			(137,825	)		(75,733	)
Pretax change		(175,121	)		(54,676	)		(88,731	)		(318,528	)
Tax effect		61,236			—			31,056			92,292
Balance at December 31, 2008		(77,062	)		(29,407	)		(195,500	)		(301,969	)
Pretax change		89,826			36,886			9,611			136,323
Pretax change in other-than-temporary impairments for which credit-related portion was recognized in earnings		18,633			—			—			18,633
Tax effect		(34,065	)		—			11,405			(22,660	)
Balance at December 31, 2009	$	(2,668	)	$	7,479		$	(174,484	)	$	(169,673	)

113

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Components of other comprehensive income (loss) allocated to The First American Corporation and noncontrolling interests are as follows:

	Net unrealized gains (losses) on securities			Foreign currency translation adjustment			Pension benefit adjustment			Accumulated other comprehensive income (loss)
	(in thousands)
2009
Allocated to The First American Corporation	$	(5,461	)	$	12,147		$	(174,484	)	$	(167,798	)
Allocated to noncontrolling interests		2,793			(4,668	)		—			(1,875	)
Balance at December 31, 2009	$	(2,668	)	$	7,479		$	(174,484	)	$	(169,673	)
2008
Allocated to The First American Corporation	$	(76,710	)	$	(23,985	)	$	(195,500	)	$	(296,195	)
Allocated to noncontrolling interests		(352	)		(5,422	)		—			(5,774	)
Balance at December 31, 2008	$	(77,062	)	$	(29,407	)	$	(195,500	)	$	(301,969	)
2007
Allocated to The First American Corporation	$	28,130		$	24,535		$	(137,825	)	$	(85,160	)
Allocated to noncontrolling interests		8,693			734			—			9,427
Balance at December 31, 2007	$	36,823		$	25,269		$	(137,825	)	$	(75,733	)

The change in net unrealized gains on securities includes reclassification adjustments of $18.4 million, $0.6 million and $2.3 million of net realized gains on debt and equity securities for the years ended December 31, 2009, 2008 and 2007, respectively.

NOTE 23.    Litigation and Regulatory Contingencies:

The Company and its subsidiaries have been named in various lawsuits, most of which relate to their title insurance operations. In cases where it has been determined that a loss is both probable and reasonably estimable, a liability representing the best estimate of the Company’s financial exposure based on known facts has been recorded. In accordance with accounting guidance, the Company maintained a reserve for these lawsuits totaling $18.9 million at December 31, 2009. Actual losses may materially differ from the amounts recorded. The Company does not believe that the ultimate resolution of these cases, either individually or in the aggregate, will have a material adverse effect on the Company’s financial condition, results of operations or cash flows.

The Company’s title insurance, property and casualty insurance, home warranty, thrift, trust and investment advisory businesses are regulated by various federal, state and local governmental agencies. Many of the Company’s other businesses operate within statutory guidelines. Consequently, the Company may from time to time be subject to audit or investigation by such governmental agencies. Currently, governmental agencies are auditing or investigating certain of the Company’s operations. These audits or investigations include inquiries into, among other matters, pricing and rate setting practices in the title insurance industry, competition in the title insurance industry, title insurance customer acquisition and retention practices and asset valuation services. With respect to matters where the Company has determined that a loss is both probable and reasonably estimable, the Company has recorded a liability representing its best estimate of the financial exposure based known facts. In accordance with accounting guidance, the Company maintained a reserve for these matters totaling $2.0 million at December 31, 2009. While the ultimate disposition of each such audit or investigation is not yet determinable,

114

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

the Company does not believe that individually or in the aggregate, they will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. These audits or investigations could result in changes to the Company’s business practices which could ultimately have a material adverse impact on the Company’s financial condition, results of operations or cash flows.

The Company’s subsidiaries also are involved in numerous ongoing routine legal and regulatory proceedings related to their operations. While the ultimate disposition of each proceeding is not determinable, the Company does not believe that any of such proceedings, individually or in the aggregate, will have a material adverse effect on its financial condition, results of operations or cash flows.

NOTE 24.    Business Combinations and Divestitures:

During the year ended December 31, 2009, the Company completed five acquisitions. Three acquisitions were included in the title insurance and services segment, one in the data and analytic solutions segment and one in the information and outsourcing solutions segment. These acquisitions had a combined purchase price of $8.4 million in cash and were not considered material, individually or in the aggregate. The purchase price of each acquisition was allocated to the assets acquired and liabilities assumed using a variety of valuation techniques including discounted cash flow analysis. As a result of the five acquisitions, the Company recorded approximately $5.5 million of goodwill and $0.3 million of intangible assets with finite lives.

Also during the year ended December 31, 2009, the Company purchased the remaining noncontrolling interests in eight companies already included in the Company’s consolidated financial statements, including the buy-in of First Advantage. Excluding the buy-in of First Advantage, the total purchase price of these transactions was $52.6 million in cash and $8.6 million in notes payable. During 2009, the Company completed the buy-in of the publicly held shares of First Advantage in a stock for stock transaction for $311.3 million (9.5 million Company shares). In connection with the buy-in, $9.1 million of stock-based compensation expense was recorded due to accelerated vesting of First Advantage stock options, restricted stock and RSUs. In addition to the above transactions, the Company paid $21.5 million for acquisition earn-outs.

During the year ended December 31, 2008, the Company completed three acquisitions. These acquisitions were not material, individually or in the aggregate. Of these three acquisitions, two have been included in the Company’s title insurance segment and one in the Company’s risk mitigation and business solutions segment.

The aggregate purchase price for the acquisitions included in the Company’s title insurance segment was $3.4 million in cash and $2.5 million in notes payable. The acquisition included in the Company’s risk mitigation and business solutions segment was completed by First Advantage. The aggregate purchase price for this acquisition was $16.3 million in cash. The purchase price of each acquisition was allocated to the assets acquired and liabilities assumed using a variety of valuation techniques including discounted cash flow analysis. As a result of the three acquisitions, the Company recorded approximately $22.5 million of goodwill and $2.3 million of intangible assets with finite lives.

In addition to the acquisitions discussed above, during the year ended December 31, 2008, the Company purchased the remaining noncontrolling interests in five companies already included in the Company’s consolidated financial statements. The total purchase price of these transactions was $61.0 million in cash. As a result of the five transactions, the Company recorded approximately $28.3 million of goodwill and $0.4 million of intangible assets with finite lives.

115

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

NOTE 25.    Segment Financial Information:

Effective January 1, 2008, the Company reorganized its two business groups and underlying segments to reflect how the assets and operations will be divided when the spin-off is consummated, which reflects how the business is currently managed. The segment presentation below reflects this reorganization. All previously reported segment information has been restated to conform to this presentation.

Financial Services Group

• Title Insurance and Services: The title insurance and services segment issues title insurance policies on residential and commercial property in the United States and offers similar products and services internationally. This segment also provides escrow and closing services, accommodates tax-deferred exchanges of real estate and provides investment advisory, trust, lending and deposit services. Beginning on January 1, 2010, this segment is also in the business of maintaining, managing and providing access to automated title plant records and images that may be owned by the Company or other parties, which was previously carried on by the data and analytic solutions segment. The Company, through its principal title insurance subsidiary and such subsidiary’s affiliates, transacts its title insurance business through a network of direct operations and agents. Through this network, the Company issues policies in the 49 states that permit the issuance of title insurance policies and the District of Columbia. In Iowa, the Company provides title abstracts only because title insurance is not permitted by law. The Company also offers title insurance and similar products, as well as related services, either directly or through joint ventures in foreign countries, including Canada, the United Kingdom and various other established and emerging markets. The international operations account for an immaterial amount of the Company’s income before income taxes.

• Specialty Insurance: The specialty insurance segment issues property and casualty insurance policies and sells home warranty products. The property and casualty insurance business provides insurance coverage to residential homeowners and renters for liability losses and typical hazards such as fire, theft, vandalism and other types of property damage. This business is licensed to issue policies in all 50 states and actively issues policies in 43 states. In its largest market, California, it also offers preferred risk auto insurance to better compete with other carriers offering bundled home and auto insurance. The home warranty business provides residential service contracts that cover residential systems and appliances against failures that occur as the result of normal usage during the coverage period. This business currently operates in 34 states and the District of Columbia.

Information Solutions Group

• Information and Outsourcing Solutions: The information and outsourcing solutions segment provides a wide-range of products and services, including tax monitoring, flood zone certification and monitoring, building and maintaining geospatial proprietary software and databases, default management services, loan administration and production services, business process outsourcing and asset valuation and management services. These products are generally provided nationwide.

• Data and Analytic Solutions: The data and analytic solutions segment provides licenses and analyzes data relating to mortgage securities and loans and real property, offers risk management and collateral assessment analytics, provides database access tools to various businesses, in particular to businesses operating in the real estate industry, and provides automated valuation models which use data and sophisticated mathematical models and analytic tools to arrive at a property valuation.

116

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

• Risk Mitigation and Business Solutions: The risk mitigation and business solutions segment is comprised entirely of First Advantage. First Advantage provides credit services, data services, employer services, multifamily services, and investigative and litigation support services. The credit services business offers lenders credit reporting solutions for mortgage and home equity needs, provides consumer credit reporting services and serves the automotive dealer marketplace by delivering consolidated consumer credit reports and automotive lead generation services. The data services business provides transportation credit reporting, motor vehicle record reporting, fleet management, criminal records reselling, specialty finance credit reporting and lead generation services. The employer services business includes employment background screening, occupational health services, tax incentive services and hiring solutions. The multifamily services business provides resident screening and software services. The investigative and litigation support services business provides all investigative services.

Corporate consists primarily of investment gains and losses, personnel and other operating expenses associated with the Company’s corporate facilities, certain technology initiatives and unallocated interest expense. Eliminations consist of inter-segment revenues included in the results of the operating segments.

117

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Selected financial information about the Company’s operations by segment for each of the past three years ended December 31, 2009 is as follows:

	Revenues			Depreciation and amortization			Equity in earnings of affiliates			Income (loss) before income taxes			Assets		Investment in affiliates		Capital expenditures
	(in thousands)
2009
Title Insurance	$	3,672,359		$	67,135		$	10,065		$	165,415		$	4,320,340	$	138,108	$	31,881
Specialty Insurance		277,539			4,275			—			28,793			445,649		—		7,503
Information and Outsourcing Solutions		904,225			23,022			69,602			202,983			1,024,578		24,586		7,802
Data and Analytic Solutions		532,442			63,193			1,150			100,416			1,372,865		107,957		27,729
Risk Mitigation and Business Solutions		705,437			43,441			7,868			53,541			1,145,187		1,903		21,314
Corporate		3,923			19,081			2,704			(127,351	)		414,478		44,487		357
Eliminations		(123,148	)		(225	)		—			—			—		—		—
	$	5,972,777		$	219,922		$	91,389		$	423,797		$	8,723,097	$	317,041	$	96,586
2008
Title Insurance	$	3,982,525		$	80,460		$	(2,620	)	$	(124,644	)	$	4,400,484	$	114,538	$	54,936
Specialty Insurance		297,817			3,329			—			17,859			420,983		—		7,344
Information and Outsourcing Solutions		727,712			23,707			41,318			151,415			994,273		29,332		19,724
Data and Analytic Solutions		545,027			68,568			907			80,250			1,338,443		105,667		29,331
Risk Mitigation and Business Solutions		782,274			64,756			5,299			62,992			1,131,610		—		31,522
Corporate		273			22,125			(142	)		(143,661	)		522,277		63,727		2,447
Eliminations		(121,870	)		—			—			—			—		—		—
	$	6,213,758		$	262,945		$	44,762		$	44,211		$	8,808,070	$	313,264	$	145,304
2007
Title Insurance	$	5,632,767		$	82,000		$	9,462		$	(234,812	)	$	4,269,343	$	141,005	$	74,190
Specialty Insurance		323,440			2,190			—			39,728			496,166		—		7,355
Information and Outsourcing Solutions		780,187			22,045			31,316			163,984			976,780		6,285		13,368
Data and Analytic Solutions		631,075			65,155			281			153,915			1,342,980		142,631		86,826
Risk Mitigation and Business Solutions		984,726			43,182			6,057			232,991			1,219,486		—		38,011
Corporate		(23,623	)		17,767			592			(203,743	)		343,166		71,364		9,358
Eliminations		(106,189	)		—			—			—			—		—		—
	$	8,222,383		$	232,339		$	47,708		$	152,063		$	8,647,921	$	361,285	$	229,108

118

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

Operating revenues from external customers separated between domestic and foreign operations and by segment for each of the three years ended December 31, 2009 is as follows:

	December 31
	2009				2008				2007
	Domestic		Foreign		Domestic		Foreign		Domestic		Foreign
	(in thousands)
Title Insurance	$	3,282,822	$	287,190	$	3,535,818	$	373,143	$	5,033,328	$	430,801
Specialty Insurance		269,631		—		286,321		—		302,822		—
Information and Outsourcing Solutions		832,888		—		668,747		—		721,577		—
Data and Analytic Solutions		419,246		5,957		433,026		8,099		475,956		8,454
Risk Mitigation and Business Solutions		656,537		37,033		686,178		89,316		769,736		84,545
	$	5,461,124	$	330,180	$	5,610,090	$	470,558	$	7,303,419	$	523,800

Long-lived assets separated between domestic and foreign operations and by segment as of December 31, 2009, 2008 and 2007 is as follows:

	December 31
	2009				2008				2007
	Domestic		Foreign		Domestic		Foreign		Domestic		Foreign
	(in thousands)
Title Insurance	$	1,455,956	$	209,801	$	1,553,216	$	114,020	$	1,664,079	$	145,210
Specialty Insurance		107,774		—		109,254		—		104,301		—
Information and Outsourcing Solutions		844,246		108		865,412		—		878,674		—
Data and Analytic Solutions		1,112,922		39,701		1,133,993		25,460		1,159,928		20,166
Risk Mitigation and Business Solutions		853,776		74,118		855,121		71,514		845,756		59,770
	$	4,374,674	$	323,728	$	4,516,996	$	210,994	$	4,652,738	$	225,146

NOTE 26.    Subsequent Events:

Subsequent events have been reviewed through the date of issuance of these consolidated financial statements. There were no material subsequent events requiring adjustment to or disclosure in these consolidated financial statements.

119

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

QUARTERLY FINANCIAL DATA

(Unaudited)

	Quarter Ended
	March 31		June 30		September 30		December 31 (2)
	(in thousands, except per share amounts)
2009 (1)
Revenues	$	1,377,812	$	1,537,382	$	1,565,482	$	1,492,101
Income before income taxes	$	83,013	$	152,413	$	113,001	$	75,370
Net income	$	54,958	$	93,935	$	71,282	$	49,001
Net income attributable to noncontrolling interests	$	18,933	$	23,663	$	15,920	$	11,009
Net income attributable to FAC	$	36,025	$	70,272	$	55,362	$	37,992
Net income per share attributable to FAC stockholders:
Basic (3)	$	0.39	$	0.75	$	0.59	$	0.39
Diluted (3)	$	0.38	$	0.75	$	0.59	$	0.38

(1) Net income for the year ended December 31, 2009 includes income of $7.1 million related to certain items that should have been recorded in a prior year. These items increased diluted net income per share attributable to FAC stockholders by $0.05 for the year.

(2) Net income for the fourth quarter ended December 31, 2009 includes income of $4.9 million related to certain items that should have been recorded in a prior quarter. These items increased diluted net income per share attributable to FAC stockholders by $0.03 for the quarter.

(3) Net income per share attributable to FAC stockholders for the four quarters of each fiscal year may not sum to the total for the fiscal year because of the different number of shares outstanding during each period.

	Quarter Ended
	March 31		June 30		September 30			December 31 (1)
	(in thousands, except per share amounts)
2008
Revenues	$	1,659,125	$	1,685,051	$	1,518,970		$	1,350,612
Income (loss) before income taxes	$	69,574	$	63,609	$	823		$	(89,795	)
Net income (loss)	$	47,457	$	36,733	$	1,856		$	(57,681	)
Net income attributable to noncontrolling interests	$	18,139	$	17,128	$	10,196		$	9,222
Net income (loss) attributable to FAC	$	29,318	$	19,605	$	(8,340	)	$	(66,903	)
Net income (loss) per share attributable to FAC stockholders:
Basic (2)	$	0.32	$	0.21	$	(0.09	)	$	(0.72	)
Diluted (2)	$	0.32	$	0.21	$	(0.09	)	$	(0.72	)

(1) Net loss for the fourth quarter ended December 31, 2008 includes the impairment loss on goodwill of $19.7 million and the title insurance loss reserve strengthening adjustment of $78.0 million.

(2) Net income (loss) per share attributable to FAC stockholders for the four quarters of each fiscal year may not sum to the total for the fiscal year because of the different number of shares outstanding during each period.

	Quarter Ended
	March 31		June 30			September 30		December 31
	(in thousands, except per share amounts)
2007
Revenues	$	2,124,767	$	2,162,904		$	2,058,102	$	1,876,610
Income (loss) before income taxes	$	180,418	$	(79,960	)	$	108,011	$	(56,406	)
Net income (loss)	$	120,979	$	(40,195	)	$	66,568	$	(38,978	)
Net income attributable to noncontrolling interests	$	37,192	$	25,801		$	19,979	$	28,521
Net income (loss) attributable to FAC	$	83,787	$	(65,996	)	$	46,589	$	(67,499	)
Net income (loss) per share attributable to FAC stockholders:
Basic (1)	$	0.87	$	(0.68	)	$	0.50	$	(0.74	)
Diluted (1)	$	0.84	$	(0.68	)	$	0.49	$	(0.74	)

(1) Net income (loss) per share attributable to FAC stockholders for the four quarters of each fiscal year may not sum to the total for the fiscal year because of the different number of shares outstanding during each period.

120

SCHEDULE I

1 OF 1

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

SUMMARY OF INVESTMENTS—OTHER THAN INVESTMENTS IN RELATED PARTIES

(in thousands)

December 31, 2009

Column A	Column B		Column C			Column D
Type of investment	Cost		Market value			Amount at which shown in the balance sheet
Deposits with savings and loan associations and banks:
Registrant—None
Consolidated	$	124,553	$	124,553		$	124,553
Debt securities:
U.S. Treasury bonds
Registrant—None
Consolidated	$	72,316	$	73,853		$	73,853
Municipal bonds
Registrant—None
Consolidated	$	132,965	$	134,956		$	134,956
Foreign bonds
Registrant—None
Consolidated	$	150,105	$	151,908		$	151,908
Governmental agency bonds
Registrant—None
Consolidated	$	326,787	$	326,774		$	326,774
Governmental agency mortgage-backed and asset-backed securities
Registrant—None
Consolidated	$	1,023,867	$	1,032,613		$	1,032,613
Non-agency mortgage-backed and asset-backed securities
Registrant—None
Consolidated	$	97,395	$	61,424		$	61,424
Corporate debt securities
Registrant—None
Consolidated	$	86,911	$	86,885		$	86,885
Total debt securities:
Registrant—None
Consolidated	$	1,890,346	$	1,868,413		$	1,868,413
Equity securities:
Registrant—None
Consolidated	$	75,596	$	99,167		$	99,167
Other long-term investments:
Registrant	$	47,589	$	47,589	(1)	$	47,589
Consolidated	$	374,862	$	374,862	(1)	$	374,862
Total investments:
Registrant	$	47,589	$	47,589	(1)	$	47,589
Consolidated	$	2,465,357	$	2,466,995		$	2,466,995

(1) As other long-term investments are not publicly traded, reasonable estimate of the fair values could not be made without incurring excessive costs. The cost basis is used as a proxy for fair value.

121

SCHEDULE III

1 OF 2

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

SUPPLEMENTARY INSURANCE INFORMATION

(in thousands)

BALANCE SHEET CAPTIONS

Column A	Column B		Column C		Column D
Segment	Deferred policy acquisition costs		Claims reserves		Deferred revenues
2009
Title Insurance and Services	$	—	$	1,185,296	$	7,216
Specialty Insurance		22,526		39,205		137,540
Information and Outsourcing Solutions		—		26,987		510,199
Data and Analytic Solutions		—		3,600		49,414
Risk Mitigation and Business Solutions		—		—		5,848
Corporate		—		—		—
Total	$	22,526	$	1,255,088	$	710,217
2008
Title Insurance and Services	$	—	$	1,277,081	$	9,248
Specialty Insurance		24,879		43,811		138,825
Information and Outsourcing Solutions		—		28,758		527,680
Data and Analytic Solutions		—		5,742		45,710
Risk Mitigation and Business Solutions		—		—		7,381
Corporate		—		—		—
Total	$	24,879	$	1,355,392	$	728,844

122

SCHEDULE III

2 OF 2

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

SUPPLEMENTARY INSURANCE INFORMATION

(in thousands)

INCOME STATEMENT CAPTIONS

Column A	Column F			Column G			Column H			Column I		Column J			Column K
Segment	Operating revenues			Net investment income			Loss provision			Amortization of deferred policy acquisition costs		Other operating expenses			Net premiums written
2009
Title Insurance and Services	$	3,573,676		$	98,683		$	207,804		$	—	$	839,329		$	—
Specialty Insurance		269,631			7,908			140,895			2,353		44,297			102,233
Information and Outsourcing Solutions		838,898			65,327			36,694			—		450,546			—
Data and Analytic Solutions		526,144			6,298			(1,941	)		—		82,535			—
Risk Mitigation and Business Solutions		695,067			10,370			—			—		401,598			—
Corporate		—			3,923			—			—		20,491			—
Eliminations		(112,112	)		(11,036	)		—			—		(112,068	)		—
Total	$	5,791,304		$	181,473		$	383,452		$	2,353	$	1,726,728		$	102,233
2008
Title Insurance and Services	$	3,908,961		$	73,564		$	343,041		$	—	$	976,527		$	—
Specialty Insurance		286,321			11,496			166,004			1,145		49,704			110,847
Information and Outsourcing Solutions		675,229			52,483			23,898			—		342,232			—
Data and Analytic Solutions		543,567			1,460			381			—		88,917			—
Risk Mitigation and Business Solutions		779,109			3,165			—			—		405,582			—
Corporate		—			273			—			—		30,157			—
Eliminations		(112,539	)		(9,331	)		—			—		(112,539	)		—
Total	$	6,080,648		$	133,110		$	533,324		$	1,145	$	1,780,580		$	110,847
2007
Title Insurance and Services	$	5,464,271		$	168,496		$	709,935		$	—	$	1,192,098		$	—
Specialty Insurance		302,822			20,618			165,192			1,032		50,962			117,649
Information and Outsourcing Solutions		735,562			44,625			18,086			—		366,775			—
Data and Analytic Solutions		570,497			60,578			729			—		97,752			—
Risk Mitigation and Business Solutions		856,542			128,184			3			—		421,994			—
Corporate		—			(23,623	)		—			—		45,627			—
Eliminations		(102,475	)		(3,714	)		—			—		(102,475	)		—
Total	$	7,827,219		$	395,164		$	893,945		$	1,032	$	2,072,733		$	117,649

123

SCHEDULE IV

1 OF 1

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

REINSURANCE

(in thousands, except percentages)

Segment	Insurance operating revenues before reinsurance		Ceded to other companies	Assumed from other companies	Insurance operating revenues		Percentage of amount assumed to operating revenues
Title Insurance
2009	$	3,570,442	5,721	8,955	$	3,573,676	0.3	%
2008	$	3,904,773	9,356	13,544	$	3,908,961	0.3	%
2007	$	5,452,340	11,792	23,723	$	5,464,271	0.4	%
Specialty Insurance
2009	$	114,094	7,832	—	$	106,262	0.0	%
2008	$	122,118	7,341	—	$	114,777	0.0	%
2007	$	129,179	8,558	—	$	120,621	0.0	%

124

SCHEDULE V

1 OF 3

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

Year Ended December 31, 2009

Column A	Column B		Column C					Column D			Column E
Description	Balance at beginning of period		Additions					Deductions from reserve			Balance at end of period
			Charged to costs and expenses			Charged to other accounts
Reserve deducted from accounts receivable:
Registrant—None
Consolidated	$	71,871	$	34,693				$	39,840	(A)	$	66,724
Reserve for title losses and other claims:
Registrant—None
Consolidated	$	1,355,392	$	383,452		$	14,023	$	497,779	(B)	$	1,255,088
Reserve deducted from loans receivable:
Registrant—None
Consolidated	$	1,600	$	471							$	2,071
Reserve deducted from assets acquired in connection with claim settlements:
Registrant—None
Consolidated	$	1,604	$	181				$	1,009	(C)	$	776
Reserve deducted from other assets:
Registrant—None
Consolidated	$	20,317	$	(6,086	)			$	—		$	14,231
Reserve deducted from deferred income taxes:
Registrant—None
Consolidated	$	28,915	$	(15,660	)						$	13,255

Note A—Amount represents accounts written off, net of recoveries.

Note B—Amount represents claim payments, net of recoveries.

Note C—Amount represents elimination of reserve in connection with disposition and/or revaluation of the related asset.

125

SCHEDULE V

2 OF 3

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

Year Ended December 31, 2008

Column A	Column B		Column C					Column D			Column E
	Balance at beginning of period		Additions					Deductions from reserve			Balance at end of period
Description			Charged to costs and expenses		Charged to other accounts
Reserve deducted from accounts receivable:
Registrant—None
Consolidated	$	62,677	$	40,178				$	30,984	(A)	$	71,871
Reserve for title losses and other claims:
Registrant—None
Consolidated	$	1,357,632	$	533,324	$	(33,466	)	$	502,098	(B)	$	1,355,392
Reserve deducted from loans receivable:
Registrant—None
Consolidated	$	1,488	$	112							$	1,600
Reserve deducted from assets acquired in connection with claim settlements:
Registrant—None
Consolidated	$	1,316	$	572				$	284	(C)	$	1,604
Reserve deducted from other assets:
Registrant—None
Consolidated	$	18,996	$	1,321				$	—		$	20,317
Reserve deducted from deferred income taxes:
Registrant—None
Consolidated	$	19,785	$	9,130							$	28,915

Note A—Amount represents accounts written off, net of recoveries.

Note B—Amount represents claim payments, net of recoveries.

Note C—Amount represents elimination of reserve in connection with disposition and/or revaluation of the related asset.

126

SCHEDULE V

3 OF 3

THE FIRST AMERICAN CORPORATION

AND SUBSIDIARY COMPANIES

VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

Year Ended December 31, 2007

Column A	Column B		Column C				Column D			Column E
	Balance at beginning of period		Additions				Deductions from reserve			Balance at end of period
Description			Charged to costs and expenses		Charged to other accounts
Reserve deducted from accounts receivable:
Registrant—None
Consolidated	$	62,467	$	44,943			$	44,733	(A)	$	62,677
Reserve for title losses and other claims:
Registrant—None
Consolidated	$	936,989	$	893,945	$	14,363	$	487,665	(B)	$	1,357,632
Reserve deducted from loans receivable:
Registrant—None
Consolidated	$	1,440	$	48						$	1,488
Reserve deducted from assets acquired in connection with claim settlements:
Registrant—None
Consolidated	$	1,280	$	6,635			$	6,599	(C)	$	1,316
Reserve deducted from other assets:
Registrant—None
Consolidated	$	1,713	$	17,283			$	—		$	18,996
Reserve deducted from deferred income taxes:
Registrant—None
Consolidated	$	11,043	$	8,742						$	19,785

Note A—Amount represents accounts written off, net of recoveries.

Note B—Amount represents claim payments, net of recoveries.

Note C—Amount represents elimination of reserve in connection with disposition and/or revaluation of the related asset.

127

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

The Company’s chief executive officer and chief financial officer have concluded that, as of the end of the fiscal year covered by this Annual Report on Form 10-K, the Company’s disclosure controls and procedures, as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended, were effective, based on the evaluation of these controls and procedures required by Rule 13a-15(b) thereunder.

There was no change in the Company’s internal control over financial reporting during the quarter ended December 31, 2009, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Management’s Annual Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. The Company’s internal control over financial reporting has been designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:

(1) Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

(2) Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

(3) Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

The Company’s internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of assets of the Company; provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures are being made only in accordance with authorization of management and directors of the Company; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the Company’s consolidated financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2008. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control—Integrated Framework. Based on that assessment under the framework in Internal Control—Integrated Framework, management determined that, as of December 31, 2009, the Company’s internal control over financial reporting was effective.

128

PricewaterhouseCoopers LLP, the independent registered public accounting firm that audited the Company’s financial statements provided in Item 8, above, has issued an attestation report on the Company’s internal controls over financial reporting.

Item 9B. Other Information

Executive Compensation

On February 23, 2010, the Compensation Committee finalized its determinations regarding the amount of executive officer annual bonuses for services rendered during 2009. The cash portion of the annual bonuses is paid by reducing the amount of previously awarded performance units to the annual bonus amount and, assuming the performance criteria are met, converting those performance units to cash. The Compensation Committee determined that the applicable performance criteria were met and instructed that the performance units be converted to cash. Excess performance units were cancelled. The committee also determined the amount of long term incentive RSUs to be awarded to the executive officers. Target and actual named executive officer bonuses, the breakdown of the bonuses between cash and RSUs, and long term incentive RSU amounts are as follows:

	Target 2009 Bonus		Actual 2009 Bonus		Cash Portion of 2009 Bonus		RSU Portion of 2009 Bonus (1)		Long Term Incentive RSUs (1)
Kennedy, Parker S.	$	2,075,000	$	2,616,483	$	1,308,242	$	1,308,242	$	850,000
Gilmore, Dennis J.	$	1,690,000	$	1,983,353	$	991,677	$	991,677	$	850,000
Piszel, Anthony S.	$	1,000,000	$	1,260,956	$	756,574	$	504,382	$	475,000
Sando, Barry M.	$	950,000	$	1,075,281	$	698,933	$	376,348	$	325,000
Valdes, Max O.	$	500,000	$	630,478	$	409,811	$	220,667	$	165,000

(1) The RSUs vest in five equal annual installments commencing on the first anniversary of the date of the grant. Pursuant to Company policy, the number of RSUs awarded will be determined by dividing the applicable dollar amount by the closing price of the Company’s stock on the second full business day following the Company’s filing of this Annual Report on Form 10-K for the year ended December 31, 2009. A copy of the complete form of the Notice of Restricted Stock Unit Grant and Restricted Stock Unit Award Agreement is attached hereto as Exhibit 10(zz).

The annual bonus amounts reflect the application of the metrics provided for in the bonus plan previously approved by the Compensation Committee, except that for Parker S. Kennedy, Dennis J. Gilmore, Anthony S. Piszel and Max O. Valdes the target title segment profit margins and labor and operating expense ratios did not adjust based on net operating revenue as originally contemplated by the bonus plan. In determining that the adjustment of the targets for net operating revenue should not apply the Compensation Committee believed the plan, as designed, did not appropriately reflect the impact of the decline in commercial revenues in 2009 on title segment margins and labor and operating expense ratios. The committee also noted the significant improvements in title segment performance, the meaningful increase in cash flow generated by the Company in 2009 compared to 2008 and the overall increase in stockholder value during 2009.

On February 23, 2010, the Compensation Committee also approved certain executive officer salaries, target bonus amounts and maximum long term incentive RSU awards.

Mr. Kennedy’s 2010 salary will remain at its 2009 level of $675,000 pending the consummation of the spin-off of the financial services businesses. Similarly, Mr. Kennedy’s pre-spin target bonus amount will remain at its 2009 annualized level of $2,075,000 and Mr. Kennedy’s maximum long term incentive RSU amount will remain at $850,000 on an annualized basis. With respect to service before the spin-off, Mr. Kennedy’s target bonus and maximum long term incentive amount will be prorated for the period from January 1, 2010 to the spin-off date. The committee deferred any determination of Mr. Kennedy’s post-spin compensation to the post-spin compensation committees.

129

Mr. Gilmore’s 2010 salary will remain at $650,000, target bonus will remain at $1,690,000 and maximum long term incentive RSU award amount will remain at $850,000 prior to the spin-off. Following the spin-off, when Mr. Gilmore becomes the chief executive officer of the publicly traded entity being spun-off from the Company, Mr. Gilmore’s salary will be $750,000, with a target bonus of $2,100,000 and a maximum long term incentive RSU award of $900,000. The ultimate 2010 target bonus and maximum long term incentive RSU opportunity will be determined by pro-rating the pre-spin and post-spin amounts based on the number of days before and after the spin-off during 2010.

Mr. Valdes’ 2010 salary, target bonus and maximum long term incentive RSU amounts will remain at their 2009 levels of $350,000, $500,000 and $175,000, respectively.

In addition, on February 23, 2010, the Compensation Committee determined the criteria upon which the target bonuses for Messrs. Kennedy, Gilmore and Valdes are anticipated to be adjusted in determining the annual incentive bonus amounts for services rendered during 2010.

Mr. Gilmore’s 2010 annual incentive bonus will be determined by adjusting the target bonus amount based on objective financial criteria in two areas (subject to certain specified adjustments that may be made at the discretion of the Compensation Committee), each of which has associated with it a threshold, target and superior level of achievement. Fifty percent of Mr. Gilmore’s target bonus amount adjusts based on the extent that actual return on equity for the financial services company deviates from budgeted return on equity and fifty percent adjusts based on the extent to which the actual pretax profit margin of the financial services company deviates from the budgeted margin. At threshold, target and superior performance levels, fifty percent, one hundred percent and one hundred seventy five percent of the target bonus amount is payable, respectively. Performance on each measure could range from zero to above one hundred seventy five percent to a maximum of two hundred fifty percent on a linear basis, provided that the total bonus payment is capped at one hundred seventy five percent of the target. It is anticipated that Mr. Gilmore’s bonus will be paid fifty percent in cash and fifty percent in RSUs vesting in four equal annual increments commencing on the first anniversary of the date of grant.

It is anticipated that half of Mr. Kennedy’s pre-spin-off 2010 bonus will be determined by adjusting the target bonus amount in the same manner as Mr. Gilmore’s bonus, and that the other half will be adjusted pursuant to the criteria applicable to the information solutions company’s chief executive officer, which criteria have yet to be determined. The post-spin-off portion of the bonus will be collectively determined by the two post-spin compensation committees.

Mr. Valdes’ annual incentive bonus will be determined in the same manner as Mr. Gilmore’s bonus amount, with the percentage to be paid in RSUs dependent upon Mr. Valdes’ total compensation for the year.

The payment of the cash portion of the 2010 annual incentive bonuses to named executive officers is anticipated to occur through the conversion into cash of performance units, which will be awarded to allow the Company to deduct for tax purposes the entire amount of such cash bonuses under section 162(m) of the Internal Revenue Code. Accordingly, each of Messrs. Kennedy, Gilmore and Valdes will receive performance units representing twice the cash portion of his 2010 annual incentive bonus amount at target (using the post-spin target amount for Messrs. Gilmore and Valdes), as follows: Parker S. Kennedy ($2,075,000); Dennis J. Gilmore ($2,100,000); and Max O. Valdes ($650,000). The award agreements give the Compensation Committee complete discretion to reduce the actual amount of performance units payable and the Compensation Committee expects to make such a reduction when it determines actual 2010 annual incentive bonus amounts. A copy of the complete form of the agreement awarding the performance units is attached hereto as Exhibit 10(mmm).

Shareholders’ Meeting

The Company’s annual shareholders’ meeting has been scheduled for May 18, 2010, at 2:00 p.m. in the Company’s home office at 1 First American Way, Santa Ana, California, 92707. Shareholders of record as of March 22, 2010, will be entitled to vote at the meeting. Shareholder proposals in connection with the meeting should be sent to our secretary and must be received no later than March 12, 2010.

130

PART IV

Item 15. Exhibits and Financial Statement Schedules

(a) 1. & 2.	Financial Statements and Financial Statement Schedules
	The Financial Statements and Financial Statement Schedules filed as part of this report are listed in the accompanying index at page 61 in Item 8 of Part II of this report.
3.	Exhibits. See Exhibit Index. (Each management contract or compensatory plan or arrangement in which any director or named executive officer of The First American Corporation, as defined by Item 402(a)(3) of Regulation S-K (17 C.F.R. §229.402(a)(3)), participates that is included among the exhibits listed on the Exhibit Index is identified on the Exhibit Index by an asterisk (*).)

131

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

THE FIRST AMERICAN CORPORATION
(Registrant)
By	/s/    PARKER S. KENNEDY
	Parker S. Kennedy Chairman and Chief Executive Officer (Principal Executive Officer)
	Date: March 1, 2010
By	/s/    ANTHONY S. PISZEL
	Anthony S. Piszel Chief Financial Officer and Treasurer (Principal Financial Officer)
	Date: March 1, 2010

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/    PARKER S. KENNEDY         Parker S. Kennedy	Chairman, CEO and Director	March 1, 2010
/s/    ANTHONY S. PISZEL         Anthony S. Piszel	Chief Financial Officer and Treasurer (Principal Financial Officer)	March 1, 2010
/s/    MAX O. VALDES         Max O. Valdes	Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)	March 1, 2010
/s/    GEORGE L. ARGYROS         George L. Argyros	Director	March 1, 2010
/s/    BRUCE S. BENNETT         Bruce S. Bennett	Director	March 1, 2010
/s/    MATHEW B. BOTEIN         Mathew B. Botein	Director	March 1, 2010
/s/    J. DAVID CHATHAM         J. David Chatham	Director	March 1, 2010

132

Signature	Title	Date
/s/    GLENN C. CHRISTENSON         Glenn C. Christenson	Director	March 1, 2010
/s/    WILLIAM G. DAVIS         William G. Davis	Director	March 1, 2010
/s/    JAMES L. DOTI         James L. Doti	Director	March 1, 2010
/s/    LEWIS W. DOUGLAS, JR.         Lewis W. Douglas, Jr.	Director	March 1, 2010
/s/    CHRISTOPHER V. GREETHAM         Christopher V. Greetham	Director	March 1, 2010
/s/    THOMAS C. O’BRIEN         Thomas C. O’Brien	Director	March 1, 2010
/s/    FRANK O’BRYAN         Frank O’Bryan	Director	March 1, 2010
John W. Peace	Director
/s/    D. VAN SKILLING         D. Van Skilling	Director	March 1, 2010
/s/    HERBERT B. TASKER         Herbert B. Tasker	Director	March 1, 2010
/s/    VIRGINIA M. UEBERROTH         Virginia M. Ueberroth	Director	March 1, 2010
/s/    MARY LEE WIDENER         Mary Lee Widener	Director	March 1, 2010

133

Exhibit No.	Description
(3)(a)	Restated Articles of Incorporation of The First American Financial Corporation, dated July 14, 1998, incorporated by reference herein from Exhibit 3.1 of Amendment No. 1, dated July 28, 1998, to the Company’s Registration Statement No. 333-53681 on Form S-4.
(3)(b)	Certificate of Amendment of Restated Articles of Incorporation of The First American Financial Corporation, dated April 23, 1999, incorporated by reference herein from Exhibit (3) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1999.
(3)(c)	Certificate of Amendment of Restated Articles of Incorporation of The First American Financial Corporation, dated May 11, 2000, incorporated by reference herein from Exhibit 3.1 of Current Report on Form 8-K, dated June 12, 2000.
(3)(d)	Certificate of Amendment of Restated Articles of Incorporation of The First American Corporation, dated December 10, 2008, incorporated by reference herein from Exhibit 3(d) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
(3)(e)	Amended and Restated Bylaws of The First American Corporation, effective December 10, 2008, incorporated by reference herein from Exhibit 3(e) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
(4)(a)	Junior Subordinated Indenture, dated as of April 22, 1997, incorporated by reference herein from Exhibit (4.2) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1997.
(4)(b)	Form of New 8.50% Junior Subordinated Deferrable Interest Debenture, incorporated by reference herein from Exhibit 4.2 of Registration Statement No. 333-35945 on Form S-4, dated September 18, 1997.
(4)(c)	Certificate of Trust of First American Capital Trust I, incorporated by reference herein from Exhibit 4.3 of Registration Statement No. 333-35945 on Form S-4, dated September 18, 1997.
(4)(d)	Amended and Restated Declaration of Trust of First American Capital Trust I, dated as of April 22, 1997, incorporated by reference herein from Exhibit (4.3) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1997.
(4)(e)	Form of New 8.50% Capital Security (Liquidation Amount $1,000 per Capital Security), incorporated by reference herein from Exhibit 4.6 of Registration Statement No. 333-35945 on Form S-4, dated September 18, 1997.
(4)(f)	Form of New Guarantee Agreement, incorporated by reference herein from Exhibit 4.7 of Registration Statement No. 333-35945 on Form S-4, dated September 18, 1997.
(4)(g)	Senior Indenture, dated as of April 7, 1998, between The First American Financial Corporation and Wilmington Trust Company as Trustee, incorporated by reference herein from Exhibit (4) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1998.
(4)(h)	Form of Underwriting Agreement, incorporated by reference herein from Exhibit 1.1 of Pre-effective Amendment No. 2 to Registration Statement No 333-116855 on Form S-3, dated July 19, 2004.
(4)(i)	Form of First Supplemental Indenture, incorporated by reference herein from Exhibit 4.2 of Registration Statement 333-116855 on Form S-3, dated June 25, 2004.
(4)(j)	Form of Senior Note, incorporated by reference herein from Exhibit 4.3 of Registration Statement 333-116855 on Form S-3, dated June 25, 2004.
*(10)(a)	Description of Stock Bonus Plan, as amended, incorporated by reference herein from Exhibit 10(a) of Annual Report on Form 10-K for the fiscal year ended December 31, 2006.
*(10)(b)	Executive Supplemental Benefit Plan, dated April 10, 1986, and Amendment No. 1 thereto, dated October 1, 1986, incorporated by reference herein from Exhibit 10(b) of Annual Report on Form 10-K for the fiscal year ended December 31, 2006.

134

Exhibit No.	Description
*(10)(c)	Amendment No. 2, dated March 22, 1990, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit 10(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 2006.
*(10)(d)	Amendment No. 3, dated July 7, 1998, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(d) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(e)	Amendment No. 4, dated March 22, 2000, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(f)	Amendment No. 5, dated July 19, 2000, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(e) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(g)	Amendment No. 6, dated September 1, 2005, to Executive Supplemental Benefit Plan, incorporated by reference herein from Exhibit 10(b) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
*(10)(h)	Amended and Restated Executive Supplemental Benefit Plan, dated November 1, 2007, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.
*(10)(i)	Amended and Restated Executive Supplemental Benefit Plan, effective as of January 1, 2009, incorporated by reference herein from Exhibit 10(i) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(j)	Management Supplemental Benefit Plan, dated July 20, 1988, incorporated by reference herein from Exhibit 10(h) of Annual Report on Form 10-K for the fiscal year ended December 31, 2006.
*(10)(k)	Amendment No. 1, dated July 7, 1998, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(f) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(l)	Amendment No. 2, dated March 22, 2000, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(h) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(m)	Amendment No. 3, dated July 19, 2000, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(f) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(n)	Amendment No. 4, dated September 1, 2005, to Management Supplemental Benefit Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2005.
*(10)(o)	Amended and Restated Management Supplemental Benefit Plan, dated November 1, 2007, incorporated by reference herein from Exhibit (10)(c) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.
*(10)(p)	Amended and Restated Management Supplemental Benefit Plan, effective as of January 1, 2009, incorporated by reference herein from Exhibit 10(p) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(q)	Pension Restoration Plan (effective as of January 1, 1994), incorporated by reference herein from Exhibit (10)(c) of Annual Report on Form 10-K for the fiscal year ended December 31, 1996.
*(10)(r)	Amendment No. 1, dated July 19, 2000, to Pension Restoration Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.

135

Exhibit No.	Description
*(10)(s)	Amendment No. 2, dated August 1, 2001, to Pension Restoration Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2001.
*(10)(t)	Amendment No. 3, dated April 21, 2008, to Pension Restoration Plan.
*(10)(u)	Amended and Restated Pension Restoration Plan, effective as of January 1, 2009, incorporated by reference herein from Exhibit 10(t) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(v)	1996 Stock Option Plan, incorporated by reference herein from Exhibit 4 of Registration Statement No. 333-19065 on Form S-8, dated December 30, 1996.
*(10)(w)	Amendment No. 1, dated February 26, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(i) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(x)	Amendment No. 2, dated June 22, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(j) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(y)	Amendment No. 3, dated July 7, 1998, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(k) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(z)	Amendment No. 4, dated April 22, 1999, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for the quarter ended June 30, 1999.
*(10)(aa)	Amendment No. 5, dated February 29, 2000, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(o) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(bb)	Amendment No. 6, dated July 19, 2000, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(cc)	Amendment No. 7, dated June 4, 2002, to 1996 Stock Option Plan, incorporated by reference herein from Exhibit (10)(a) of Quarterly Report on Form 10-Q for quarter ended June 30, 2002.
*(10)(dd)	Stock Option Award Agreement, dated as of March 31, 2006, between The First American Corporation and Frank V. McMahon, incorporated by reference herein from Exhibit 99.1 of Current Report on Form 8-K, dated March 31, 2006.
*(10)(ee)	Amended and Restated Change in Control Agreement (Executive Form), dated February 26, 2008, incorporated by reference herein from Exhibit (10)(xxx) of Annual Report on Form 10-K for the fiscal year ended December 31, 2007.
*(10)(ff)	Amended and Restated Change in Control Agreement (Executive Form), effective as of January 1, 2009, incorporated by reference herein from Exhibit 10(ee) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(gg)	Amended and Restated Change in Control Agreement (Executive Form), effective as of January 1, 2010, incorporated by reference herein from Exhibit (10)(c) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2009.
*(10)(hh)	Amended and Restated Change in Control Agreement (Management Form), dated February 26, 2008, incorporated by reference herein from Exhibit (10)(yyy) of Annual Report on Form 10-K for the fiscal year ended December 31, 2007.

136

Exhibit No.	Description
*(10)(ii)	Amended and Restated Change in Control Agreement (Management Form), effective as of January 1, 2009, incorporated by reference herein from Exhibit 10(gg) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(jj)	Amended and Restated Change in Control Agreement (Management Form), effective as of January 1, 2010, incorporated by reference herein from Exhibit (10)(d) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2009.
*(10)(kk)	Letter agreement regarding Amended and Restated Change in Control Agreement, dated December 29, 2008, incorporated by reference herein from Exhibit 10(hh) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(ll)	1997 Directors’ Stock Plan, incorporated by reference herein from Exhibit 4.1 of Registration Statement No. 333-41993 on Form S-8, dated December 11, 1997.
*(10)(mm)	Amendment No. 1 to 1997 Directors’ Stock Plan, dated February 26, 1998, incorporated by reference herein from Exhibit (10)(m) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(nn)	Amendment No. 2 to 1997 Directors’ Stock Plan, dated July 7, 1998, incorporated by reference herein from Exhibit (10)(n) of Annual Report on Form 10-K for the fiscal year ended December 31, 1998.
*(10)(oo)	Amendment No. 3, dated July 19, 2000, to 1997 Directors’ Stock Plan, incorporated by reference herein from Exhibit (10)(c) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
*(10)(pp)	Amended and Restated Deferred Compensation Plan, effective as of January 1, 2009, incorporated by reference herein from Exhibit 10(mm) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(qq)	The First American Financial Corporation Deferred Compensation Plan Trust Agreement, dated March 10, 2000, incorporated by reference herein from Exhibit (10)(w) of Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
*(10)(rr)	Letter agreement, dated June 25, 2007, regarding the retirement of Craig I. DeRoy, incorporated by reference herein from Exhibit 10(a) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2007.
*(10)(ss)	The First American Corporation 2006 Incentive Compensation Plan, incorporated by reference herein from Appendix A of the Definitive Proxy Statement of the Company filed on April 10, 2006.
*(10)(tt)	Form of Notice of Restricted Stock Unit Grant (Employee) and Restricted Stock Unit Award Agreement (Employee), approved February 27, 2007, incorporated by reference herein from Exhibit 99.1 to Current Report on Form 8-K, dated February 27, 2007.
*(10)(uu)	Form of Amendment to Restricted Stock Unit Award Agreement, incorporated by reference herein from Exhibit 99.1 to Current Report on Form 8-K, dated March 20, 2007.
*(10)(vv)	Form of Amendment to Restricted Stock Unit Award Agreement, incorporated by reference herein from Exhibit 99.1 to Current Report on Form 8-K, dated April 6, 2007.
*(10)(ww)	Form of Notice of Restricted Stock Unit Grant (Employee) and Restricted Stock Unit Award Agreement (Employee), approved February 26, 2008, incorporated by reference herein from Exhibit (10)(tt) of Annual Report on Form 10-K for the fiscal year ended December 31, 2007.
*(10)(xx)	Form of Notice of Restricted Stock Unit Grant (Employee) and Restricted Stock Unit Award Agreement (Employee), approved February 10, 2009, incorporated by reference herein from Exhibit 10(uu) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.

137

Exhibit No.	Description
*(10)(yy)	Form of Notice of Restricted Stock Unit Grant (Employee) and Restricted Stock Unit Award Agreement (Employee), approved October 5, 2009, incorporated by reference herein from Exhibit (10)(e) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2009.
*(10)(zz)	Form of Notice of Restricted Stock Unit Grant (Employee) and Restricted Stock Unit Award Agreement (Employee), approved January 25, 2010.
*(10)(aaa)	Restricted Stock Award Agreement, dated as of March 31, 2006, between The First American Corporation and Frank V. McMahon, incorporated by reference herein from Exhibit 99.1 of Current Report on Form 8-K, dated March 31, 2006.
*(10)(bbb)	Form of Notice of Restricted Stock Unit Grant (Non-Employee Director) and Restricted Stock Unit Award Agreement (Non-Employee Director), incorporated by reference herein from Exhibit 99.1 to Current Report on Form 8-K, dated March 1, 2007.
*(10)(ccc)	Form of Notice of Restricted Stock Unit Grant (Non-Employee Director) and Restricted Stock Unit Award Agreement (Non-Employee Director) for Non-Employee Director Restricted Stock Unit Award, incorporated by reference herein from Exhibit 10(b) of Quarterly Report on Form 10-Q for the quarter ended June 30, 2008.
*(10)(ddd)	Form of Notice of Restricted Stock Unit Grant (Non-Employee Director) and Restricted Stock Unit Award Agreement (Non-Employee Director), approved February 10, 2009, incorporated by reference herein from Exhibit 10(yy) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(eee)	Arrangement regarding bonus plan for named executive officers, approved February 28, 2008, incorporated by reference herein to the description contained in Item 9B of Annual Report on Form 10-K for the fiscal year ended December 31, 2007.
*(10)(fff)	Arrangement regarding bonus plan for named executive officers, approved July 29, 2008, incorporated by reference herein to the description contained in the Current Report on Form 8-K, dated July 29, 2008.
*(10)(ggg)	Arrangement regarding salaries, bonuses, long term incentive restricted stock units and performance units for named executive officers, approved March 12, 2009, incorporated by reference herein to the description contained in the Current Report on Form 8-K, dated March 13, 2009.
*(10)(hhh)	Arrangement regarding bonus plan for named executive officers, approved April 6, 2009, incorporated by reference herein to the description contained in the Current Report on Form 8-K, dated April 10, 2009.
*(10)(iii)	Arrangement regarding salaries, bonuses, long term incentive restricted stock units and performance units for named executive officers, approved February 23, 2010, incorporated by reference herein to the description contained in Item 9B of this Annual Report on Form 10-K.
*(10)(jjj)	Form of Notice of Performance Unit Grant and Performance Unit Award Agreement, incorporated by reference herein from Exhibit 99.2 to Current Report on Form 8-K, dated March 20, 2007.
*(10)(kkk)	Form of Notice of Performance Unit Grant and Performance Unit Award Agreement, approved February 26, 2008, incorporated by reference herein from Exhibit (10)(yy) of Annual Report on Form 10-K for the fiscal year ended December 31, 2007.
*(10)(lll)	Form of Notice of Performance Unit Grant and Performance Unit Award Agreement, approved February 10, 2009, incorporated by reference herein from Exhibit 10(eee) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(mmm)	Form of Notice of Performance Unit Grant and Performance Unit Award Agreement, approved January 25, 2010.
(10)(nnn)	Amended and Restated Contribution and Joint Venture Agreement by and among The First American Financial Corporation and Experian Information Solutions, Inc., et al., dated December 31, 2009.

138

Exhibit No.	Description
(10)(ooo)	Amended and Restated Operating Agreement for First American Real Estate Solutions LLC, a California Limited Liability Company, by and among First American Real Estate Information Services, Inc. and Experian Information Solutions, Inc., et al., dated December 31, 2009.
(10)(ppp)	Reseller Services Agreement, dated as of November 30, 1997, incorporated by reference herein from Exhibit (10)(g) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(qqq)	Amendment to Reseller Services Agreement for Resales to Consumers, dated as of November 30, 1997, incorporated by reference herein from Exhibit (10)(h) of Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
(10)(rrr)	Termination and Release Agreement by and among The First American Corporation and Experian Information Solutions, Inc., et al., dated December 31, 2009.
(10)(sss)	Second Amended and Restated Credit Agreement, dated as of November 16, 2009, among The First American Corporation, JP Morgan Chase Bank, as Administrative Agent, and certain other Lenders party thereto.
(10)(ttt)	Promissory Note, dated as of December 13, 2007, of First American CoreLogic Holdings, Inc. in favor of Banc of America Leasing & Capital, LLC, incorporated by reference herein from Exhibit 99.1 to Current Report on Form 8-K, dated December 13, 2007.
(10)(uuu)	Master Security Agreement, dated as of December 13, 2007, between First American CoreLogic Holdings, Inc. and Banc of America Leasing & Capital, LLC, incorporated by reference herein from Exhibit 99.2 to Current Report on Form 8-K, dated December 13, 2007.
(10)(vvv)	Continuing Guaranty, dated as of December 13, 2007, by First American Real Estate Solutions LLC in favor of Banc of America Leasing & Capital, LLC, incorporated by reference herein from Exhibit 99.3 to Current Report on Form 8-K, dated December 13, 2007.
(10)(www)	Letter to Curt Johnson, dated February 26, 2008, regarding relocation loan, incorporated by reference herein from Exhibit (10)(www) of Annual Report on Form 10-K for the fiscal year ended December 31, 2007.
(10)(xxx)	Support Agreement, dated April 10, 2008, between The First American Corporation, Highfields Capital Management LP, Highfields GP LLC, Highfields Associates LLC, Highfields Capital I L.P., Highfields Capital II L.P., and Highfields Capital III L.P., incorporated by reference herein from Exhibit 99.1 to Current Report on Form 8-K, dated April 14, 2008.
(10)(yyy)	Employment offer letter, dated February 21, 2006 from The First American Corporation to Frank V. McMahon, incorporated by reference herein from Exhibit 99.2 of Current Report on Form 8-K, dated February 21, 2006.
(10)(zzz)	Employment Agreement, dated September 12, 2008, between First American Title Insurance Company and Curt G. Johnson, incorporated by reference herein from Exhibit 10(b) of Quarterly Report on Form 10-Q for the quarter ended September 30, 2008.
*(10)(aaaa)	Employment Agreement, dated December 17, 2008, between The First American Corporation and Dennis J. Gilmore, incorporated by reference herein from Exhibit 10(dddd) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(bbbb)	Employment Agreement, dated December 17, 2008, between The First American Corporation and Barry M. Sando, incorporated by reference herein from Exhibit 10(eeee) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(cccc)	Employment Agreement, dated December 17, 2008, between The First American Corporation and Max O. Valdes, incorporated by reference herein from Exhibit 10(ffff) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.

139

Exhibit No.	Description
*(10)(dddd)	Employment Agreement, dated January 27, 2009, between The First American Corporation and Anthony S. Piszel, incorporated by reference herein from Exhibit 10(gggg) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
*(10)(eeee)	Letter agreement regarding relocation arrangement with Anthony S. Piszel, dated August 25, 2009, incorporated by reference herein from Exhibit (10)(b) of Quarterly Report on Form 10-Q for the quarter ended March 31, 2009.
*(10)(ffff)	Employment Agreement, dated August 10, 2009, between First Advantage Corporation and Anand Nallathambi, incorporated by reference herein from Exhibit 99(e)(8) of Solicitation/Recommendation Statement on Schedule 14D-9 of First Advantage Corporation, dated October 9, 2009.
*(10)(gggg)	Separation Agreement and General Release, dated as of January 13, 2010, between The First American Corporation and Frank V. McMahon.
*(10)(hhhh)	Consulting Agreement, dated as of January 13, 2010, between The First American Corporation and Frank V. McMahon.
*(10)(iiii)	Non-Employee Director 2009 Compensation Summary, incorporated by reference herein from Exhibit 10(hhhh) of Annual Report on Form 10-K for the fiscal year ended December 31, 2008.
(21)	Subsidiaries of the registrant.
(23)	Consent of Independent Registered Public Accounting Firm.
(31)(a)	Certification by Chief Executive Officer Pursuant to Rule 13a-14(a) under the Securities Act of 1934.
(31)(b)	Certification by Chief Financial Officer Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
(32)(a)	Certification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350.
(32)(b)	Certification by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.

* Indicates a management contract or compensatory plan or arrangement in which any director or named executive officer participates.

140

EX-10.(T)

Exhibit (10)(t)

Amendment No. 3

to

The First American Corporation

Pension Restoration Plan

(Effective as of January 1, 1994)

The following amendments are hereby made to The First American Corporation Pension Restoration Plan (“Plan”):

1. Effective as of April 30, 2008, the following sentence is added to the end of Plan section 1.3, relating to the application of the Plan:

“Notwithstanding any other Plan provision, no additional benefit shall be accrued by any Participant under the Plan after April 30, 2008.”

2. Effective as of April 30, 2008, the following sentence is added to the end of Plan section 3.1, relating to the Restoration of Benefit:

“Notwithstanding the foregoing, no Participant will earn any Benefit Service towards his Restoration Benefit for any period after April 30, 2008.”

3. Effective as of April 30, 2008, the following sentence is added to the end of Plan section 4.1, relating to Retirement Benefits:

“Notwithstanding any other provision of this Plan, in computing the Participant’s Restoration Benefit such Restoration Benefit shall not include any accruals for Benefit Service for any Participant attributable to periods after April 30, 2008.”

4. Except as amended above, the Plan as in effect prior to this amendment shall continue unchanged.

* * * * * * * * * *

In Witness Whereof, The First American Corporation caused its duly authorized officer to execute this Plan Amendment on this 21 day of April, 2008.

The First American Corporation
By:	/s/ Kelly J. Dunmore
Its:	Vice President, Employee Benefits

1

EX-10.(ZZ)

Exhibit (10)(zz)

[Employee]

Notice of Restricted Stock Unit Grant

Participant:	[Participant Name]
Company:	The First American Corporation
Notice:	You have been granted the following Restricted Stock Units in accordance with the terms of the Plan and the Restricted Stock Unit Award Agreement attached hereto.
Type of Award:	Restricted Stock Units
Plan:	The First American Corporation 2006 Incentive Compensation Plan
Grant:	Date of Grant: [Grant Date]
	[Number of Shares Underlying Bonus Restricted Stock Units: [Number of shares Granted]]
	[Number of Shares Underlying Other Restricted Stock Units: [Number of shares Granted]]
Period of Restriction:	Subject to the terms of the Plan and this Agreement, the Period of Restriction applicable to the Restricted Stock Units shall commence on the Date of Grant and shall lapse on the date listed in the “Lapse Date” column below as to that percentage of Shares underlying the Restricted Stock Units set forth below opposite each such date.

Lapse Date	Percentage of Shares as to Which Period of Restriction Lapses
Date of Grant + 1 year	20	%
Date of Grant + 2 years	20	%
Date of Grant + 3 years	20	%
Date of Grant + 4 years	20	%
Date of Grant + 5 years	20	%

For the avoidance of doubt, the relevant percentage of the Period of Restriction shall lapse on a pro-rata basis with respect to each of the total Shares underlying Bonus Restricted Stock Units and the total Shares underlying Other Restricted Stock Units.

Rejection:

If you wish to accept this Restricted Stock Unit Award, please access Fidelity NetBenefits® at www.netbenefits.com and follow the steps outlined under the “Accept Grant” link at any time within forty-five (45) days after the Date of Grant. If you do not accept your grant via Fidelity NetBenefits® within forty-five (45) days after the Date of Grant, you will have rejected this Restricted Stock Unit Award.

[Employee]

Restricted Stock Unit Award Agreement

This Restricted Stock Unit Award Agreement (this “Agreement”), dated as of the Date of Grant set forth in the Notice of Restricted Stock Unit Grant attached hereto (the “Grant Notice”), is made between The First American Corporation (the “Company”) and the Participant set forth in the Grant Notice. The Grant Notice is included in and made part of this Agreement.

1. Definitions.

Capitalized terms used but not defined in this Agreement (including the Grant Notice) have the meaning set forth in the Plan.

For “Cause,” shall be defined as: (i) embezzlement, theft or misappropriation by the Participant of any property of any of the Company or its affiliates; (ii) Participant’s breach of any fiduciary duty to the Company or its affiliates; (iii) Participant’s failure or refusal to comply with laws or regulations applicable to the Company or its affiliates and their businesses or the policies of the Company and its affiliates governing the conduct of its employees or directors; (iv) Participant’s gross incompetence in the performance of Participant’s job duties; (v) commission by Participant of a felony or of any crime involving moral turpitude, fraud or misrepresentation; (vi) the failure of Participant to perform duties consistent with a commercially reasonable standard of care; (vii) Participant’s failure or refusal to perform Participant’s job duties or to perform specific directives of Participant’s supervisor or designee, or the senior officers or Board of Directors of the Company; or (viii) any gross negligence or willful misconduct of Participant resulting in loss to the Company or its affiliates, or damage to the reputation of the Company or its affiliates.

2. Grant of the Restricted Stock Units.

Subject to the provisions of this Agreement and the provisions of the Plan, the Company hereby grants to the Participant, pursuant to the Plan, a right to receive the number of shares of common stock of the Company, par value $1.00 per share (“Shares”), set forth in the Grant Notice (the “Restricted Stock Units”).

3. Dividend Equivalents.

Each Restricted Stock Unit shall accrue Dividend Equivalents with respect to dividends that would otherwise be paid on the Share underlying such Restricted Stock Unit during the period from the Grant Date to the date such Share is delivered in accordance with Section 6. Any such Dividend Equivalent shall be deemed reinvested in additional Shares underlying the Restricted Stock Units within each Period of Restriction immediately upon the related dividend’s payment date, based on the then-current Fair Market Value (rounded down to the nearest whole number), and shall be subject to the Period of Restriction applicable to the Restricted Stock Unit on which such Dividend Equivalent is paid. Any such conversion of Dividend Equivalents shall be conclusively determined by the Committee. The Shares underlying Restricted Stock Units into which Dividend Equivalents are so converted shall be delivered in accordance with Section 6.

4. Period of Restriction; Termination.

The Period of Restriction with respect to the Restricted Stock Units shall be as set forth in the Grant Notice. Subject to the terms of the Plan and the remaining provisions of this Section 4, all Restricted Stock Units for which the Period of Restriction had not lapsed prior to the date of the Participant’s Termination shall be immediately forfeited. Notwithstanding the foregoing to the contrary:

(a) In the event of the Participant’s Termination due to his or her death, the Period of Restriction as to all Restricted Stock Units shall lapse in its entirety.

(b) In the event of the Participant’s Termination due to his or her Disability, the Period of Restriction as to all Restricted Stock Units shall lapse in its entirety, provided that the Participant shall have signed a separation agreement in the form established by the Company.

- 2 -

(c) In the event of the Participant’s Termination due to his or her Normal Retirement, the Period of Restriction as to all Restricted Stock Units shall continue in effect until, and lapse on, the first anniversary of the date of such Normal Retirement, provided that the Participant shall have signed a separation agreement in the form established by the Company.

(d) In the event of Participant’s Termination due to his or her Early Retirement, the outstanding Period of Restriction applicable to all Bonus Restricted Stock Units (but not any Other Restricted Stock Units) shall continue in effect until, and lapse on, the first anniversary of the date of such Early Retirement, provided that the Participant shall have signed a separation agreement in the form established by the Company.

(e) In the event of the Participant’s involuntary Termination by the Company or an Affiliate without Cause, the outstanding Period of Restriction applicable to all Bonus Restricted Stock Units (but not any Other Restricted Stock Units) shall continue in effect until, and lapse on, the first anniversary of the date of such Termination, provided that the Participant shall have signed a separation agreement in the form established by the Company.

For purposes of this Agreement, “Normal Retirement” means Termination of the Participant, other than for Cause, after the Participant has reached 62 years of age and “Early Retirement” means Termination of the Participant, other than for Cause, after the Participant has reached 55 years of age and been employed by the Company and/or an Affiliate for more than 10 years.

5. Change of Control.

Except for a Change of Control that has been approved by the Company’s Incumbent Board prior to the occurrence of such Change of Control, the provisions of Section 15.1 of the Plan shall apply to the Restricted Stock Units.

6. Delivery of Shares.

As soon as reasonably practicable following the lapse of the applicable portion of the Period of Restriction, but in no event later than 90 days following the date of such lapse, the Company shall cause to be delivered to the Participant the full number of Shares underlying the Restricted Stock Units as to which such portion of the Period of Restriction has so lapsed, together with Shares comprising all accrued Dividend Equivalents with respect to such Restricted Stock Units, subject to satisfaction of applicable tax withholding obligations with respect thereto pursuant to Article XVII of the Plan; provided, however, that if the Participant’s Termination occurs due to Disability, such delivery of Shares shall be delayed for six months from the date of such Participant’s Termination if the Participant is a “specified employee” (as such term is defined in Section 409A(a)(2)(B)(i) of the Code) and if necessary to avoid the imposition of taxes on the Participant pursuant to Section 409A of the Code.

7. No Ownership Rights Prior to Issuance of Shares.

Neither the Participant nor any other person shall become the beneficial owner of the Shares underlying the Restricted Stock Units, nor have any rights to dividends or other rights as a shareholder with respect to any such Shares, until and after such Shares have been actually issued to the Participant and transferred on the books and records of the Company or its agent in accordance with the terms of the Plan and this Agreement.

8. Detrimental Activity.

(a) Notwithstanding any other provisions of this Agreement to the contrary, if at any time prior to the delivery of Shares with respect to the Restricted Stock Units, the Participant engages in Detrimental Activity, such Restricted Stock Units shall be cancelled and rescinded without any payment or consideration therefor. The determination of whether the Participant has engaged in Detrimental Activity shall be made by the Committee in its good faith discretion, and lapse of the Period of Restriction and delivery of Shares with respect to

- 3 -

the Restricted Stock Units shall be suspended pending resolution to the Committee’s satisfaction of any investigation of the matter.

(b) For purposes of this Agreement, “Detrimental Activity” means at any time (i) using information received during the Participant’s employment with the Company and/or its Subsidiaries and Affiliates relating to the business affairs of the Company or any such Subsidiaries or Affiliates, in breach of the Participant’s express or implied undertaking to keep such information confidential; (ii) directly or indirectly persuading or attempting to persuade, by any means, any employee of the Company or any of its Subsidiaries or Affiliates to breach any of the terms of his or her employment with Company, its Subsidiaries or its Affiliates; (iii) directly or indirectly making any statement that is, or could be, disparaging of the Company or any of its Subsidiaries or Affiliates, or any of their respective employees (except to the extent necessary to respond truthfully to any inquiry from applicable regulatory authorities or to provide information pursuant to legal process); (iv) directly or indirectly engaging in any illegal, unethical or otherwise wrongful activity that is, or could be, substantially injurious to the financial condition, reputation or goodwill of the Company or any of its Subsidiaries or Affiliates; or (v) directly or indirectly engaging in an act of misconduct such as, embezzlement, fraud, dishonesty, nonpayment of any obligation owed to the Company or any of its Subsidiaries or Affiliates, breach of fiduciary duty or disregard or violation of rules, policies or procedures of the Company or any of its Subsidiaries or Affiliates, an unauthorized disclosure of any trade secret or confidential information of the Company or any of its Subsidiaries or Affiliates, any conduct constituting unfair competition, or inducing any customer to breach a contract with the Company or any of its Subsidiaries or Affiliates, in each case as determined by the Committee in its good faith discretion.

9. No Right to Continued Employment.

None of the Restricted Stock Units nor any terms contained in this Agreement shall confer upon the Participant any express or implied right to be retained in the employ of the Company or any Subsidiary or Affiliate for any period, nor restrict in any way the right of the Company or any Subsidiary or any Affiliate, which right is hereby expressly reserved, to terminate the Participant’s employment at any time for any reason. For the avoidance of doubt, this Section 9 is not intended to amend or modify any other agreement, including any employment agreement, that may be in existence between the Participant and the Company or any Subsidiary or Affiliate.

10. The Plan.

In consideration for this grant, the Participant agrees to comply with the terms of the Plan and this Agreement. This Agreement is subject to all the terms, provisions and conditions of the Plan, which are incorporated herein by reference, and to such regulations as may from time to time be adopted by the Committee. In the event of any conflict between the provisions of the Plan and this Agreement, the provisions of the Plan shall control, and this Agreement shall be deemed to be modified accordingly. The Plan and the prospectus describing the Plan can be found on Fidelity NetBenefits® at www.netbenefits.com under Plan Information and Documents. A paper copy of the Plan and the prospectus shall be provided to the Participant upon the Participant’s written request to the Company at The First American Corporation, 1 First American Way, Santa Ana, California 92707, Attention: Incentive Compensation Plan Administrator, or such other address as the Company may from time to time specify.

11. Compliance with Laws and Regulations.

(a) The Restricted Stock Units and the obligation of the Company to sell and deliver Shares hereunder shall be subject in all respects to (i) all applicable Federal and state laws, rules and regulations and (ii) any registration, qualification, approvals or other requirements imposed by any government or regulatory agency or body which the Committee shall, in its discretion, determine to be necessary or applicable. Moreover, the Company shall not deliver any certificates for Shares to the Participant or any other person pursuant to this Agreement if doing so would be contrary to applicable law. If at any time the Company determines, in its discretion, that the listing, registration or qualification of Shares upon any national securities exchange or under any state or Federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable, the Company shall not be required to deliver any certificates for Shares to the Participant or any other person pursuant to this Agreement unless and until such listing, registration, qualification, consent or approval has been effected or obtained, or otherwise provided for, free of any conditions not acceptable to the Company.

- 4 -

(b) It is intended that the Shares received in respect of the Restricted Stock Units shall have been registered under the Securities Act. If the Participant is an “affiliate” of the Company, as that term is defined in Rule 144 under the Securities Act (“Rule 144”), the Participant may not sell the Shares received except in compliance with Rule 144. Certificates representing Shares issued to an “affiliate” of the Company may bear a legend setting forth such restrictions on the disposition or transfer of the Shares as the Company deems appropriate to comply with Federal and state securities laws.

(c) If, at any time, the Shares are not registered under the Securities Act, and/or there is no current prospectus in effect under the Securities Act with respect to the Shares, the Participant shall execute, prior to the delivery of any Shares to the Participant by the Company pursuant to this Agreement, an agreement (in such form as the Company may specify) in which the Participant represents and warrants that the Participant is purchasing or acquiring the shares acquired under this Agreement for the Participant’s own account, for investment only and not with a view to the resale or distribution thereof, and represents and agrees that any subsequent offer for sale or distribution of any kind of such Shares shall be made only pursuant to either (i) a registration statement on an appropriate form under the Securities Act, which registration statement has become effective and is current with regard to the Shares being offered or sold, or (ii) a specific exemption from the registration requirements of the Securities Act, but in claiming such exemption the Participant shall, prior to any offer for sale of such Shares, obtain a prior favorable written opinion, in form and substance satisfactory to the Company, from counsel for or approved by the Company, as to the applicability of such exemption thereto.

12. Notices.

All notices by the Participant or the Participant’s assignees shall be addressed to The First American Corporation, 1 First American Way, Santa Ana, California 92707, Attention: Incentive Compensation Plan Administrator, or such other address as the Company may from time to time specify. All notices to the Participant shall be addressed to the Participant at the Participant’s address in the Company’s records.

13. Severability.

In the event any provision of this Agreement shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of this Agreement, and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included.

- 5 -

14. Other Plans.

The Participant acknowledges that any income derived from the Restricted Stock Units shall not affect the Participant’s participation in, or benefits under, any other benefit plan or other contract or arrangement maintained by the Company or any Subsidiary or Affiliate. For purposes of the Company’s Executive Supplemental Benefit Plan and Management Supplemental Benefit Plan, as the same may be amended from time to time, Bonus Restricted Stock Units shall be deemed to be “Covered Compensation” in an amount equal to 100% of their Fair Market Value on the Date of Grant. Other Restricted Stock Units shall not be deemed to be “Covered Compensation.” Dividend Equivalents paid on either Bonus Restricted Stock Units or Other Restricted Stock Units shall not be deemed to be “Covered Compensation” under such plans.

15. Vesting of RSUs Contingent on Company Performance.

Notwithstanding any other provisions in this Agreement, except in the event of an acceleration of vesting pursuant to Section 4(a) or Section 5 of this Agreement, the Participant’s entitlement to the receipt of any Shares hereunder is contingent upon the Company’s achievement of net income (as defined in accordance with generally acceptable accounting principals) for 2010 of $50 million or more. Net income shall be determined without regard to (a) asset write-downs, (b) litigation or claim judgments or settlements, (c) the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results, (d) any reorganization and restructuring programs, (e) extraordinary, unusual and/or nonrecurring items of gain or loss, and (f) foreign exchange gains and losses. If the Company consummates a spin-off of one or more entities prior to December 31, 2010, the performance condition specified in the previous sentence shall be determined by adding to the net income of the Company the net income of any entity whose stock was distributed to the shareholders of the Company.

THE FIRST AMERICAN CORPORATION
By:
	Name: Parker S. Kennedy
	Title: Chairman and Chief Executive Officer
Date:	[Grant Date]

Acknowledged and agreed as of the Date of Grant:

Printed Name:	[Participant Name]
Date:	[Acceptance Date]

[NOTE: GRANT WILL BE ACCEPTED ELECTRONICALLY]

- 6 -

EX-10.(MMM)

Exhibit (10)(mmm)

Notice of Performance Unit Grant

Participant:	[—]
Company:	The First American Corporation (the “Company”)
Notice:	You have been granted a Performance Unit in accordance with the terms of the Plan and the Performance Unit Award Agreement attached hereto.
Type of Award:	Performance Units
Plan:	The First American Corporation 2006 Incentive Compensation Plan
Grant:	Date of Grant: March 22, 2010
	Number of Performance Units: [—]
	Each Performance Unit has the value of $1
Performance Period:	Subject to the terms of the Plan and this Agreement, the Performance Period applicable to the Performance Units shall be the calendar year 2010.
Performance Condition:	Your right to the receipt of cash for your Performance Units is conditioned on the Company’s achievement of net income (as defined in accordance with generally acceptable accounting principles) for 2010 of $50 million or more, determined without regard to (a) asset write-downs, (b) litigation or claim judgments or settlements, (c) the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported results, (d) any reorganization and restructuring programs, (e) extraordinary, unusual and/or nonrecurring items of gain or loss, and (f) foreign exchange gains and losses. If the Company consummates a spin-off of one or more entities prior to December 31, 2010, the performance condition specified in the previous sentence shall be determined by adding to the net income of the Company the net income of any entity whose stock was distributed to the shareholders of the Company. This condition is referred to as the “Performance Target.” Within a reasonable time after the determination of whether the Performance Target has been met, the Committee shall determine the final amount of Performance Units to which you shall be entitled, provided that the total amount thereof shall not exceed the amount set forth above. The Committee, in its sole and unfettered discretion, may decrease the number of Performance Units awarded to you at any time prior to the payment thereon.
Rejection:	If you wish to accept this Performance Unit Award, please return this Agreement, executed by you on the last page of this Agreement, at any time within forty-five (45) days after the Date of Grant, to The First

American Corporation, 1 First American Way, Santa Ana, California 92707, Attn: Matthew MacDougall. Do not return a signed copy of this Agreement if you wish to reject this Performance Unit Award. If you do not return a signed copy of this Agreement within forty-five (45) days after the Date of Grant, you will have rejected this Performance Unit Award.

- 2 -

Performance Unit Award Agreement

This Performance Unit Award Agreement (this “Agreement”), dated as of the date of the Notice of Performance Unit Grant attached hereto (the “Grant Notice”), is made between The First American Corporation (the “Company”) and the Participant set forth in the Grant Notice. The Grant Notice is included and made a part of this Agreement.

1. Definitions.

Capitalized terms used but not defined in this Agreement (including the Grant Notice) have the meaning set forth in the First American Corporation 2006 Incentive Compensation Plan.

2. Grant of the Performance Units.

Subject to the provisions of this Agreement and the provisions of the Plan, the Company hereby grants to the Participant, pursuant to the Plan, the contingent right to receive in cash an amount equal in value to the performance units set forth in the Grant Notice, as such number of performance units may be reduced by the Committee in its sole and unfettered discretion (the “Performance Units”). Each Performance Unit has a value of $1.

3. Vesting and Payment of Performance Units.

After the Performance Period (as specified in the Notice of Grant) has ended and provided that the Committee has determined that the Performance Target (as defined in the Notice of Grant) has been achieved, the Participant shall be entitled to receive, and the Company shall pay to the Participant, the cash value of the Performance Units; provided, however, that prior to paying to the Participant such cash value, the Committee may, in its sole and unfettered discretion, decrease the amount of Performance Units awarded to the Participant. If the Performance Target is not met, the Participant shall forfeit the Performance Units and the Participant shall not be entitled to any cash payment in connection therewith.

4. No Right to Continued Employment.

None of the Performance Units nor any terms contained in this Agreement shall confer upon the Participant any express or implied right to be retained in the employ of the Company or any Subsidiary or Affiliate for any period, nor restrict in any way the right of the Company or any Subsidiary or any Affiliate, which right is hereby expressly reserved, to terminate the Participant’s employment at any time for any reason. For the avoidance of doubt, this Section 4 is not intended to amend or modify any other agreement, including any employment agreement, that may be in existence between the Participant and the Company or any Subsidiary or Affiliate.

5. The Plan.

In consideration for this grant, the Participant agrees to comply with the terms of the Plan and this Agreement. This Agreement is subject to all the terms, provisions and conditions of the Plan, which are incorporated herein by reference, and to such regulations as may from time to time be adopted by the Committee. In the event of any conflict between the

- 3 -

provisions of the Plan and this Agreement, the provisions of the Plan shall control, and this Agreement shall be deemed to be modified accordingly. The Plan and the prospectus describing the Plan can be found on the Company’s HR intranet. A paper copy of the Plan and the prospectus shall be provided to the Participant upon the Participant’s written request to the Company at The First American Corporation, 1 First American Way, Santa Ana, California 92707, Attention: Incentive Compensation Plan Administrator, or such other address as the Company may from time to time specify.

6. Notices.

All notices by the Participant or the Participant’s assignees shall be addressed to The First American Corporation, 1 First American Way, Santa Ana, California 92707, Attention: Incentive Compensation Plan Administrator, or such other address as the Company may from time to time specify. All notices to the Participant shall be addressed to the Participant at the Participant’s address in the Company’s records.

7. Severability.

In the event any provision of this Agreement shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of this Agreement, and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included.

8. Other Plans.

The Participant acknowledges that any income derived from the Performance Units shall not affect the Participant’s participation in, or benefits under, any other benefit plan or other contract or arrangement maintained by the Company or any Subsidiary or Affiliate. For purposes of the Company’s Executive Supplemental Benefit Plan and Management Supplemental Benefit Plan, as the same may be amended from time to time, cash ultimately paid for any Performance Units shall be deemed to be “Covered Compensation”.

9.        Assignment. Participant may not transfer or assign this Agreement or any part thereof. The Company reserves the right to transfer or assign this Agreement to any of its Affiliates.

[SIGNATURES FOLLOW]

- 4 -

THE FIRST AMERICAN CORPORATION
By:
	Name:
	Title:
Date:

Acknowledged and agreed as of the Date of Grant:

Signature:

Printed Name:

Date:

- 5 -

EX-10.(NNN)

Exhibit (10)(nnn)

[Execution Copy]

AMENDED AND RESTATED

CONTRIBUTION AND JOINT VENTURE AGREEMENT

By and Among

THE FIRST AMERICAN CORPORATION,

FIRST AMERICAN REAL ESTATE INFORMATION SERVICES INC.,

EXPERIAN INFORMATION SOLUTIONS, INC.

and

FIRST AMERICAN REAL ESTATE SOLUTIONS LLC

December 31, 2009

TABLE OF CONTENTS^1/

		Page
ARTICLE I.        DEFINITIONS		2
1.01.	Defined Terms	2
1.02.	Principles of Construction	4
ARTICLE II.        MANAGEMENT SERVICES FEES		5
2.01.	Calendar Year 2009	5
2.02.	Calendar Year 2010	5
2.03.	Subsequent Calendar Years	6
ARTICLE III.      EXPERIAN PUT OPTION; FIRST AMERICAN CALL OPTION		6
3.01.	Experian Put Option	6
3.02.	First American Call Option	8
3.03.	General Put/Call Provisions	9
3.04.	Dispute Resolution.	9
ARTICLE IV.      MISCELLANEOUS		10
4.01.	Fees and Expenses	10
4.02.	Representation and Warranties; Covenants	10
4.03.	Public Announcements	11
4.04.	Notices	11
4.05.	Entire Agreement	12
4.06.	Binding Effect; Benefit; Assignment	12
4.07.	Amendment, Modification and Termination	13
4.08.	Further Actions	13

^1/ This Table of Contents is provided for convenience only, and does not form a part of the attached Amended and Restated Contribution and Joint Venture Agreement.

i

4.09.	Counterparts	13
4.10.	Applicable Law; Submission to Jurisdiction	13
4.11.	Severability	14

ii

AMENDED AND RESTATED CONTRIBUTION AND JOINT VENTURE AGREEMENT, made as of December 31, 2009 (this “Agreement”), by and among THE FIRST AMERICAN CORPORATION, a California corporation (“First American”), FIRST AMERICAN REAL ESTATE INFORMATION SERVICES, INC., a California corporation, (“FAREISI”), EXPERIAN INFORMATION SOLUTIONS, INC., an Ohio corporation (“Experian”), and FIRST AMERICAN REAL ESTATE SOLUTIONS LLC, a California limited liability company (“FARES”; and, together with First American, FAREISI and Experian, each a “Party” and, collectively, the “Parties”).

W I T N E S S E T H:

WHEREAS, First American Appraisal Services, Inc., a California corporation, First American Appraisal Consulting Services, Inc., a California corporation, First American CREDCO, Inc., a Washington corporation, First American Field Services, Inc., a New Jersey corporation, First American Flood Data Services, Inc., a Texas corporation, First American Property Services, Inc., a New York corporation, First American Real Estate Tax Service, Inc., a Florida corporation, Pasco Enterprises, Inc., a Texas corporation, Prime Credit Reports, Inc., a California corporation, Property Financial Services of New England, Inc., a Delaware Corporation, Docs Acquisition Corp., a Nevada corporation, Strategic Mortgage Services, Inc. (Texas), a Texas Corporation (the foregoing entities, collectively, the “First American Companies”), First American, FAREISI and Experian are parties to that certain Contribution and Joint Venture Agreement, dated as of November 30, 1997 (the “Original Contribution Agreement”);

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies) and Experian are parties to that certain Agreement of Amendment dated as of June 30, 2003 (the “First Amendment”) pursuant to which, among other things, the Original Contribution Agreement was amended;

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies) and Experian are parties to that certain Second Agreement of Amendment dated as of September 23, 2003 (the “Second Amendment”) pursuant to which, among other things, the Original Contribution Agreement was further amended;

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies), Experian and FARES are parties to that certain Omnibus Agreement dated as of March 22, 2005, as amended and restated by that certain Amended and Restated Omnibus Agreement dated as of June 22, 2005, as further amended by that certain Amendment No. 1 to Amended and Restated Omnibus Agreement dated as of November 10, 2009 (as so amended and restated and further amended, the “Omnibus Agreement”) pursuant to which, among other things, the Original Contribution Agreement was further amended and the parties entered into certain arrangements with regard to FARES;

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies) and Experian are parties to that certain Fourth Agreement of Amendment dated as of February 1, 2007 (the “Fourth Amendment”) pursuant to which, among other things, the Original Contribution Agreement was further amended (the Original Contribution Agreement, as

amended by the First Amendment, the Second Amendment, the Omnibus Agreement and the Fourth Amendment, and as otherwise may have been amended, supplemented or otherwise modified through the date hereof, is hereinafter referred to as the “Existing Contribution Agreement”);

WHEREAS, each of the First American Companies has merged with and into FAREISI or their rights and obligations have otherwise been assumed by FAREISI; and

WHEREAS, the Parties desire to amend and restate the Existing Contribution Agreement as provided herein.

NOW, THEREFORE, the Parties hereby amend and restate the Existing Contribution Agreement in its entirety as follows:

ARTICLE I.

DEFINITIONS

1.01. Defined Terms. As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined):

“Accelerated Call Closing Date” has the meaning set forth in Section 3.02(a) hereof.

“Accelerated Put Closing Date” has the meaning set forth in Section 3.01(a) hereof.

“Adjusted Earnings” means, for any period, an amount equal to the sum of (i) the profits of FARES and its subsidiaries, on a consolidated basis, minus (A) FARES’ equity in the profits of First Advantage Corporation, (B) so long as such Entities are subsidiaries of FARES, the profits of (I) First American CoreLogic, Inc. and its subsidiaries, on a consolidated basis, (II) Data Tree LLC and its subsidiary, First Indian Corporation, Private Limited, on a consolidated basis, and (III) Smart Title Solutions LLC and its subsidiaries, Data Trace Information Services LLC, Accu-Search, Inc. and Data Trace Abstractor Services LLC, on a consolidated basis, and (C) Smart Title Solution LLC’s equity in the profits of Title Records, Inc. and Signature Information Solutions LLC, assuming an effective tax rate of 40% (which percentage Experian and FAREISI may from time to time hereafter agree to adjust to reflect material changes in tax rates), and (ii) the profits of First American CoreLogic, Inc. and its subsidiaries, on a consolidated basis, as long as First American CoreLogic, Inc. is a subsidiary of FARES (minus 40% of such profits only if US GAAP requires FARES’ equity therein to be on a pre-tax basis), in each case as determined in accordance with US GAAP and excluding extraordinary gains and charges, restructuring charges and other unusual or infrequently occurring items.

“Affiliate” means and includes, with reference to any Person, any other Person, other than FARES, Controlling, Controlled by or under common Control with such Person.

“Agreement” means this Amended and Restated Contribution and Joint Venture Agreement, as the same may be amended, modified and/or supplemented from time to time.

“Business Day” means any day, excluding Saturday, Sunday or any day which shall be a legal holiday in the State of California.

2

“Call Closing Date” has the meaning set forth in Section 3.02(a) hereof.

“Call Designee” has the meaning set forth in Section 3.02(a).

“Call Option” has the meaning set forth in Section 3.02(a) hereof.

“Call Price” has the meaning set forth in Section 3.02(b) hereof.

“Control” means the power to vote more than 50% of the Voting Interests of an Entity or to otherwise control the management and affairs of such Entity (including by way of the power to veto any material act or decision). Controlled and Controlling shall have co-relative meanings.

“Entity” means any Person that is not a natural Person.

“Existing Contribution Agreement” has the meaning set forth in the recitals hereto.

“Experian” has the meaning set forth in the introductory paragraph of this Agreement.

“Experian Special Put Notice” has the meaning set forth in Section 3.01(a).

“FAREISI” has the meaning set forth in the introductory paragraph of this Agreement; provided, however that from and after any transfer of a Membership Interest pursuant to the second sentence of 6.04(b) of the Operating Agreement, “FAREISI” shall be deemed to refer to any transferee pursuant to such transfer so long as it remains a Member.

“FARES” has the meaning set forth in the introductory paragraph of this Agreement.

“First Amendment” has the meaning set forth in the recitals hereto.

“First American” has the meaning set forth in the introductory paragraph of this Agreement.

“First American Member” means, at any time, a Member that is First American or is a Member that is Controlled by First American at that time.

“Fourth Amendment” has the meaning set forth in the recitals hereto.

“Member” means, at any time, a Person that is a member of FARES at that time.

“Member Affiliate” has the meaning set forth in Section 4.02(a).

“Membership Interest” means, with respect to any Member, its interest in FARES as determined in accordance with the Operating Agreement.

“Omnibus Agreement” has the meaning set forth in the recitals hereto.

“Operating Agreement” means the Amended and Restated Operating Agreement of FARES dated on or about the date hereof.

3

“Original Contribution Agreement” has the meaning set forth in the recitals hereto.

“Panel” has the meaning set forth in Section 3.04(b).

“Panel Date” has the meaning set forth in Section 3.04(b).

“Party” and “Parties” has the meaning set forth in the introductory paragraph of this Agreement.

“Percentage Interest” has the meaning set forth in the Operating Agreement.

“Person” means and includes any individual, partnership, association, joint stock company, joint venture, corporation, trust, limited liability company, unincorporated organization, government, agency or political subdivision thereof.

“Put Closing Date” has the meaning set forth in Section 3.01(a) hereof.

“Put Designee” has the meaning set forth in Section 3.01(a).

“Put Option” has the meaning set forth in Section 3.01(a) hereof, and shall include the Special Put Option for all purposes hereunder (except to the extent expressly provided otherwise).

“Put Price” has the meaning set forth in Section 3.01(b) hereof.

“Second Amendment” has the meaning set forth in the recitals hereto.

“Special Put Closing Date” has the meaning set forth in Section 3.01(a) hereof.

“Special Put Option” has the meaning set forth in Section 3.01(a) hereof.

“Spin-off Successor” means a transferee of First American’s rights under this Agreement pursuant to Section 4.06(b) hereof.

“Spin-off Successor Member” means, at any time, a Member that is the Spin-off Successor or is a Member that is Controlled by the Spin-off Successor at that time.

“US GAAP” means United States generally accepted accounting principles applied on a consistent basis.

“Voting Interest” means with respect to any Entity, any equity interest of such Entity having general voting power under ordinary circumstances to participate in the election of a majority of the governing body of such Entity (irrespective of whether at the time any other class or classes of equity interest of such Entity shall have or might have voting power by reason of the happening of any contingency).

1.02. Principles of Construction.

(a) All references to Articles, Sections and subsections are to Articles, Sections and subsections in or to this Agreement unless otherwise specified. The words “hereof,” “herein”

4

and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The term “including” is not limiting and means “including without limitation.”

(b) All accounting terms not specifically defined herein shall be construed in accordance with US GAAP.

(c) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including”; the words “to” and “until” each mean “to but excluding”; and the word “through” means “to and including.”

(d) The Table of Contents hereto and the Article and Section headings herein are for convenience only and shall not affect the construction hereof.

(e) This Agreement is the result of negotiations among and has been reviewed by counsel to the Parties and is the products of all Parties. Accordingly, this Agreement shall not be construed against any Party merely because of such Party’s involvement in its preparation.

ARTICLE II.

MANAGEMENT SERVICES FEES

2.01. Calendar Year 2009. FARES agrees to pay the following fees for each calendar quarter of 2009, including the calendar quarter ended December 31, 2009:

(a) so long as FAREISI is a Member of FARES, a fee to First American in respect of management services provided by First American and its Affiliates from time to time to FARES in an amount equal to 0.80% of FARES’ gross revenues (excluding therefrom (i) the gross revenue of First Advantage Corporation (and its subsidiaries), and (ii) the gross revenues from and after the date of this Agreement of Data Tree LLC, First Indian Corporation, Private Limited, Smart Title Solutions LLC, Data Trace Information Services LLC, Accu-Search, Inc., Data Trace Abstractor Services LLC, Title Records, Inc. and Signature Information Solutions LLC attributable to FARES), as determined in accordance with US GAAP, which fee shall be paid in arrears for each calendar quarter within 30 days of the conclusion of the applicable calendar quarter; and

(b) so long as Experian is a Member of FARES, a fee to Experian in respect of management services provided by Experian and its Affiliates from time to time to FARES in an amount equal to 0.20% of FARES’ gross revenues (excluding therefrom (i) the gross revenue of First Advantage Corporation (and its subsidiaries), and (ii) the gross revenues from and after the date of this Agreement of Data Tree LLC, First Indian Corporation, Private Limited, Smart Title Solutions LLC, Data Trace Information Services LLC, Accu-Search, Inc., Data Trace Abstractor Services LLC, Title Records, Inc. and Signature Information Solutions LLC attributable to FARES), as determined in accordance with US GAAP, which fee shall be paid in arrears for each calendar quarter within 30 days of the conclusion of the applicable calendar quarter.

2.02. Calendar Year 2010. FARES agrees to pay the following fees for each calendar quarter commencing with the calendar quarter ended March 31, 2010 and ending with the calendar quarter ended December 31, 2010:

5

(a) so long as a First American Member or a Spin-off Successor Member is a Member of FARES, a fee to First American or the Spin-off Successor, as the case may be, in respect of management services provided by First American and its Affiliates or the Spin-off Successor and its Affiliates, as the case may be, from time to time to FARES in an amount equal to $1,972,000, which fee shall be paid in arrears for each calendar quarter within 30 days of the conclusion of the applicable calendar quarter; and

(b) so long as Experian is a Member of FARES, a fee to Experian in respect of management services provided by Experian and its Affiliates from time to time to FARES in an amount equal to $493,000, which fee shall be paid in arrears for each calendar quarter within 30 days of the conclusion of the applicable calendar quarter; provided, that if a Special Put Closing Date, the Accelerated Put Closing Date or the Accelerated Call Closing Date, as the case may be, occurs on a day that is not the last day of a fiscal quarter of the Company, Experian shall be entitled to receive the product of $493,000 and a fraction, the numerator of which is the number of days elapsed from and including the first day of the fiscal quarter during which the Special Put Closing Date, the Accelerated Put Closing Date or the Accelerated Call Closing Date, as the case may be, occurs to but excluding such Special Put Closing Date, the Accelerated Put Closing Date or the Accelerated Call Closing Date, as the case may be, and the denominator of which is the number of days during such fiscal quarter.

2.03. Subsequent Calendar Years. If neither the Put Option nor the Call Option has been exercised by December 31, 2010, Experian and First American or the Spin-off Successor, as the case may be, shall promptly following such date negotiate in good faith to determine the formula or method by which management services fee payments will be made by FARES.

ARTICLE III.

EXPERIAN PUT OPTION; FIRST AMERICAN CALL OPTION

3.01. Experian Put Option.

(a) At any time on and after April 1, 2010, Experian shall have the right, at any one time (and only once), so long as First American or the Spin-off Successor, as the case may be, has not exercised the Call Option pursuant to Section 3.02, to elect to sell to First American or the Spin-off Successor (the “Put Option”), as the case may be, with the closing of such sale to occur on the last day of the calendar year in which the Put Option is exercised (the “Put Closing Date”), 100% of the Membership Interest then owned by Experian by delivering to First American or the Spin-off Successor, as the case may be, no later than one month prior to the applicable Put Closing Date a written notice specifying its election to exercise the Put Option hereunder; provided, however, if such notice is delivered during the month of December, the Put Closing Date shall be, at First American’s or the Spin-off Successor’s, as the case may be, written election, the last day of such December or any Business Day in January in the calendar year following the calendar year in which the Put Option is exercised. Upon the occurrence of either (i) (A) an Offer Rejection (as such term is defined in the Operating Agreement) prior to April 1, 2010 where a First American Member or a Spin-off Successor Member, as the case may be, is the proposed transferor and (B) Experian’s election not to participate in such transfer pursuant to Section 6.04(e) of the Operating Agreement, or (ii) any Member which was previously a First American Member or a Spin-off Successor Member ceases to be a First

6

American Member or a Spin-off Successor Member (other than as contemplated by Section 4.06(b) hereof), Experian shall have the right, at any one time (and only once) in connection with each such event, to elect to sell to First American or the Spin-off Successor (the “Special Put Option”), as the case may be, 100% of the Membership Interest then owned by Experian, with the closing of such sale to occur, at Experian’s written election (the “Experian Special Put Notice”) (which election must be made no later than the later of (x) ten (10) days following Experian’s receipt of the applicable Transfer Notice (as such term is defined in the Operating Agreement) or notice that a Member has ceased to be an Affiliate of First American or the Spin-off Successor) or (y) April 1, 2010) on the first Business Day that is at least ten (10) days following delivery of the Experian Special Put Notice (the “Special Put Closing Date”). Notwithstanding anything herein to the contrary, in the event that following the exercise of the Put Option or the Special Put Option, as the case may be, but prior to the Put Closing Date or the Special Put Closing Date, as the case may be, (x) FARES sells all or substantially all of its assets or is dissolved or liquidated, (y) any Membership Interest not owned by Experian is sold or otherwise transferred to a party which is not a First American Member or a Spin-off Successor Member on the date of such sale or transfer or (z) any Member which was previously a First American Member or a Spin-off Successor Member ceases to be a First American Member or a Spin-off Successor Member (other than as contemplated by Section 4.06(b) hereof), the Put Closing Date or the Special Put Closing Date, as the case may be, shall be the time immediately prior to the closing of such sale, dissolution, liquidation or other transfer or such Member ceasing to be a First American Member or Spin-Off Successor Member, as the case may be (a Put Closing Date or Special Put Closing Date that is accelerated in accordance with the provisions of this sentence shall be referred to hereinafter as an “Accelerated Put Closing Date”). On the Put Closing Date, the Special Put Closing Date or the Accelerated Put Closing Date, as the case may be, (i) Experian shall deliver to First American or the Spin-off Successor, as the case may be, or an Affiliate thereof designated in writing by First American or the Spin-off Successor, as the case may be, to Experian not less that two (2) Business Days prior to the Put Closing Date, the Special Put Closing Date or the Accelerated Put Closing Date (the “Put Designee”) such duly executed instruments of transfer as may be reasonably requested by First American, the Spin-off Successor or the Put Designee, as the case may be, to give effect to the purchase and sale of Experian’s Membership Interest; and (ii) First American or the Spin-off Successor, as the case may be, shall, or shall cause the Put Designee to, deliver to Experian, by wire transfer in immediately available funds, the Put Price.

(b) The “Put Price” shall be (i) $313,847,000 if the Put Option is exercised on or prior to December 31, 2010; or (ii) if the Put Option is exercised after December 31, 2010, an amount equal to (A)(1) the Percentage Interest of Experian subject to the Put Option as of the date of the exercise of the Put Option (expressed as a decimal) multiplied by (2) the product of (I) the average annualized Adjusted Earnings for the eight fiscal quarters immediately preceding (and ending on) June 30 of the calendar year preceding the calendar year in which the Put Option is exercised multiplied by (II) 12.5; plus (B) any distributions on the Membership Interest of Experian and any management services fees which have been declared or have accrued but have not been paid as of the Put Closing Date, the Special Put Closing Date or the Accelerated Put Closing Date, as the case may be.

(c) First American or the Spin-off Successor shall provide Experian not less than ten (10) days prior written notice of (i) any event which will result in any First American Member or Spin-off Successor Member ceasing to be a First American Member or Spin-off Successor

7

Member, as the case may be, (ii) any sale of all or substantially all of the assets of FARES, or any dissolution or liquidation of FARES or (iii) any sale or transfer of any Membership Interest by any First American Member or Spin-of Successor Member.

3.02. First American Call Option.

(a) First American or the Spin-off Successor, as the case may be, shall have the right, at any one time (and only once) on and after April 1, 2010, so long as Experian has not exercised the Put Option pursuant to Section 3.01, to elect to purchase from Experian (the “Call Option”), with the closing of such sale to occur on the last day of the calendar year in which the Call Option is exercised (the “Call Closing Date”), 100% of the Membership Interest then owned by Experian by delivering to Experian no later than one month prior to the applicable Call Closing Date a written notice specifying its election to exercise the Call Option hereunder; provided, however, if such notice is delivered during the month of December, the Call Closing Date shall be, at First American’s or the Spin-off Successor’s, as the case may be, written election, the last day of such December or any Business Day in January in the calendar year following the calendar year in which the Call Option is exercised. Notwithstanding anything herein to the contrary, in the event that following the exercise of the Call Option, but prior to the Call Closing Date, (x) FARES sells all or substantially all of its assets or is dissolved or liquidated, (y) any Membership Interest not owned by Experian is sold or otherwise transferred to a party which is not a First American Member or a Spin-off Successor Member on the date of such sale or transfer or (z) any Member which was previously a First American Member or a Spin-off Successor Member ceases to be a First American Member or a Spin-off Successor Member (other than as contemplated by Section 4.06(b) hereof), then the Call Closing Date shall be the time immediately prior to such sale, liquidation, dissolution, transfer or such Member ceasing to be a First American Member or a Spin-Off Successor Member (a Call Closing Date that is accelerated in accordance with the provisions of this sentence shall be referred to hereinafter as an “Accelerated Call Closing Date”). On the Call Closing Date or the Accelerated Call Closing Date, as the case may be, (i) Experian shall deliver to First American or the Spin-off Successor, as the case may be, or an Affiliate thereof designated in writing by First American or the Spin-off Successor, as the case may be, to Experian not less that two (2) Business Days prior to the Call Closing Date or the Accelerated Call Closing Date (the “Call Designee”) such duly executed instruments of transfer as may be reasonably requested by First American, the Spin-off Successor or the Call Designee, as the case may be, to give effect to the purchase and sale of Experian’s Membership Interest; and (ii) First American or the Spin-off Successor, as the case may be, shall, or shall cause the Call Designee to, deliver to Experian, by wire transfer in immediately available funds, the Call Price.

(b) The “Call Price” shall be (i) $313,847,000 if the Call Option is exercised on or prior to December 31, 2010; or (ii) if the Call Option is exercised after December 31, 2010, an amount equal to (A)(1) the Percentage Interest of Experian subject to the Call Option as of the date of the exercise of the Call Option (expressed as a decimal) multiplied by (2) the product of (I) the average annualized Adjusted Earnings for the eight fiscal quarters immediately preceding (and ending on) June 30 of the calendar year preceding the calendar year in which the Call Option is exercised multiplied by (II) 12.5; plus (B) any distributions on the Membership Interest of Experian and any management services fees which have been declared or have accrued but have not been paid as of the Call Closing Date or the Accelerated Call Closing Date, as the case may be.

8

3.03. General Put/Call Provisions.

(a) The place of payment of the Put Price or the Call Price, as the case may be, shall be the principal offices of First American or the Spin-off Successor, as the case may be, or at such other location as shall be agreed upon in writing by Experian and First American or the Spin-off Successor, as the case may be, no later than three (3) Business Days prior to the time of payment.

(b) In addition to any rights and remedies provided in the Operating Agreement, in the event that First American or the Spin-off Successor, as the case may be, fails to pay the Put Price on the applicable Put Closing Date, Special Put Closing Date or Accelerated Put Closing Date or the Call Price on the applicable Call Closing Date or Accelerated Call Closing Date, then the Put Price or the Call Price shall accrue interest, compounded monthly, at a rate equal to the lesser of (x) 15% per annum and (y) the maximum legally allowable rate of interest for the period from and after the Put Closing Date, Special Put Closing Date, Accelerated Put Closing Date, Call Closing Date or Accelerated Call Closing Date, as applicable, until the Put Price or the Call Price, as applicable, plus all accrued and unpaid interest (and expenses pursuant to the next sentence) has been paid in full. In addition to the Put Price or the Call Price, and accrued interest pursuant to the preceding sentence, First American or the Spin-off Successor, as the case may be, shall pay to Experian on demand all costs and expenses incurred by Experian related to, or in connection with, the enforcement and collection of Experian’s right to receive the Put Price or the Call Price, and all other amounts due pursuant to this Section 3.03(b), including without limitation, reasonable attorneys fees, expenses and disbursements.

3.04. Dispute Resolution.

(a) Except with respect to a default in the payment of the Put Price or the Call Price on the applicable Put Closing Date, Special Put Closing Date, Accelerated Put Closing Date, Call Closing Date or Accelerated Call Closing Date, as the case may be, in the event of any dispute arising out of or relating to this Article III (including, without limitation, any dispute involving the determination of the Put Price or the Call Price or any other amount (including, without limitation, the Adjusted Earnings upon which the Put Price and the Call Price is based) to be paid in connection with the purchase of Experian’s Membership Interest), First American, the Spin-off Successor or Experian, as the case may be, shall provide written notice to the other party of the dispute, which notice shall specify the notifying party’s position. Each of First American or the Spin-off Successor, as the case may be, and Experian agree to attempt in good faith to resolve any such dispute within 30 days following the receipt of the written notice thereof.

(b) If the dispute cannot be resolved within the 30 day period described in Section 3.04(a) above, either First American or the Spin-off Successor, as the case may be, on the one hand or Experian on the other hand may, by delivering written notice to the other, submit any such dispute to the following resolution procedure. A panel (the “Panel”) shall be created to resolve the dispute and shall be composed of three members who shall be appointed as follows: (i) one Panel member shall be appointed by First American or the Spin-off Successor, as the case may be, and one Panel member shall be appointed by Experian in each case as designated by written notice to the other within 15 days after receipt of the notice submitting the disputes to the resolution procedure and (ii) the third, who shall serve as chairperson, shall be appointed by the two Panel members so appointed pursuant to preceding clause (i) within 10 days after the second

9

appointment pursuant to such clause (i). If a Person, or Persons, entitled to appoint a Panel member fails to appoint such Panel member within the time period permitted therefor, such Panel member shall at the written request of either Party be appointed by the American Arbitration Association. The date on which all Panel members shall have been selected is hereinafter referred to as the “Panel Date”. The place of the dispute resolution proceedings and all other matters to be determined by the Panel will be determined by the majority vote of the Panel. Except as provided in Section 3.04(c) below, each of First American or the Spin-off Successor, as the case may be, on the one hand and Experian on the other hand shall bear their respective costs and expenses (including attorneys’ fees) in connection with the dispute resolution proceedings and shall be responsible for one-half of the fees, costs and expenses of the Panel.

(c) The Panel shall render a written decision with reasons therefor within 30 days of the Panel Date. The Panel may award fees, costs and expenses (including attorneys’ fees and Panel costs) to the prevailing Party and may award interest on any amount determined to be owing. Any determination by the Panel shall be final and binding upon the Parties and may be enforced by any court of competent jurisdiction in the same manner as a judgment in such court.

(d) Notwithstanding anything to the contrary contained in this Section 3.04, each of First American or the Spin-off Successor, as the case may be, and Experian hereby covenant and agree that, in the event of a dispute involving the determination of the Put Price, the Call Price or any other amount to be paid in connection with the purchase of Experian’s Membership Interest pursuant to any provision of this Article III, (i) each such Party shall, within the time limit prescribed in Section 3.04(b)(i) above, appoint a representative from its independent certified public accountants as its Panel member and (ii) the third Panel member shall, within the time limit prescribed in Section 3.04(b)(ii) above, be appointed by the two Panel members appointed by the Parties pursuant to clause (i) of this Section 3.04(d) from a firm of independent certified public accountants of nationally recognized standing. If a Person, or Persons, entitled to appoint a Panel member pursuant to this Section 3.04(d) fails to appoint such Panel member within the time period permitted therefor, such Panel member shall at the written request of either Party be appointed by the American Arbitration Association.

ARTICLE IV.

MISCELLANEOUS

4.01. Fees and Expenses. Except as set forth in Section 3.03(b) and 3.04(c), all costs and expenses incurred in connection with this Agreement and the consummation of the transactions contemplated hereby shall be paid by the Party incurring such costs and expenses. Should any litigation be commenced between the parties hereto concerning any provision of this Agreement or the rights and duties of any person in relation thereto, the party or parties prevailing in such litigation shall be entitled, in addition to such other relief as may be granted, to a reasonable sum as and for attorneys’ fees in such litigation.

4.02. Representation and Warranties; Covenants

(a) First American represents and warrants to Experian on the date of this Agreement that neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby by First American, will (i) violate the organizational

10

documents of First American or any of its Affiliates that is a Member or a direct or indirect shareholder or member of such Member (each such Affiliate, a “Member Affiliate”), (ii) conflict with, result in a breach of, any agreement, contract or instrument to which First American or any Member Affiliate is a party or by which it is bound except to the extent such violation or breach would not have a material adverse effect on the ability of First American to perform its obligations under this Agreement or (iii) violate any judgment, order, decree or legal requirement applicable to First American or any Member Affiliate except to the extent such violation would not have a material adverse effect on the ability of First American to perform its obligations under this Agreement.

(b) Without the prior written consent of Experian, First American shall not, and shall not permit any of its Member Affiliates to, (i) execute, deliver or otherwise enter into any agreement, contract or instrument which, were it entered into on the date hereof, would have constituted a breach of the representation and warranty pursuant to Section 4.02(a), or (ii) amend its organizational documents or participate in any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or take any other voluntary action, including the filing of a bankruptcy case, with a purpose of avoiding or delaying or seeking to avoid or delay the observance or performance of any of the terms to be observed or performed by First American pursuant to this Agreement. In the event that First American transfers this Agreement to a Spin-off Successor, references in this Section 4.02 to First American shall be deemed to refer to the Spin-off Successor and references to Member Affiliate shall be deemed to refer to the Spin-off Successor or any of its Affiliates that is a Member or a direct or indirect shareholder or member of such Member.

4.03. Public Announcements. The Parties agree to consult promptly with each other prior to issuing any press release or otherwise making any public statement with respect to the transactions contemplated hereby, and shall not issue any such press release or make any such public statement prior to such consultation and review by the other Party of a copy of such release or statement, unless required by applicable law.

4.04. Notices. All notices, requests, demands, waivers and other communications required or permitted to be given under this Agreement shall be in writing and shall be addressed as follows:

If to Experian: Experian Information Solutions, Inc. 475 Anton Blvd. Costa Mesa, California 92626-7036 Telephone: (714) 830-5331 Facsimile: (714) 830-2513 Attention: Senior Vice President and General Counsel

11

with a copy to:	Sonnenschein Nath & Rosenthal LLP 233 South Wacker Dr. Suite 7800 Chicago, Illinois 60606 Telephone: (312) 876-8000 Facsimile: (312) 876-7934 Attention: Michael D. Rosenthal
If to First American, FAREISI or FARES:	The First American Corporation 1 First American Way Santa Ana, California 92707 Telephone: (714) 250-3000 Facsimile: (714) 250-6923 Attention: Chief Executive Officer Attention: General Counsel
with a copy to:	White & Case LLP 633 West 5th Street, 19th Floor Los Angeles, CA 90071 Telephone: (213) 620-7700 Facsimile: (213) 452-2329 Attention: Neil W. Rust

or to such other Person or address as any Party shall specify by notice in writing to each of the other Parties. Except for a notice of a change of address, which shall be effective only upon receipt thereof, all such notices, requests, demands, waivers and communications properly addressed shall be effective: (i) if sent by U.S. mail, three Business Days after deposit in the U.S. mail, postage prepaid; (ii) if sent by FedEx or other overnight delivery service, two Business Days after delivery to such service; (iii) if sent by personal courier, upon receipt; and (iv) if sent by facsimile, upon receipt.

4.05. Entire Agreement. This Agreement contains the entire understanding of the Parties hereto with respect to the subject matter contained herein and supersedes all prior agreements and understandings, oral and written, with respect thereto unless specifically set forth to the contrary herein.

4.06. Binding Effect; Benefit; Assignment.

(a) This Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective successors and permitted assigns, but neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the Parties hereto (whether though merger, operation of law or otherwise) without the prior written consent of each other Party. Nothing in this Agreement, expressed or implied, is intended to confer on any Person other than the Parties hereto or their respective successors and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

12

(b) Notwithstanding anything stated in paragraph (a), First American may, and at the written request of Experian shall, transfer or assign this Agreement and its rights, interests and obligations hereunder to any Person which meets each of the following criterion:

(i) is an Affiliate of First American;

(ii) the stock or other equity of which is distributed to the shareholders of First American or its successor and immediately following such distribution is listed or eligible for trading on a national stock exchange; and

(iii) owns, directly or through one or more subsidiaries, all of the outstanding membership interests in FARES not owned by Experian.

Any transferee pursuant to this Section 4.06(b) shall be required at the time of the distribution, to agree in writing to assume the rights, interests and obligations of First American hereunder and any such transferee shall thereafter be deemed a “Party.”

(c) In the event that, prior to April 1, 2010, any Membership Interest not owned by Experian shall be transferred by First American or the Spin-off Successor, as the case may be, to a party which is an Affiliate of First American or the Spin-off Successor, as the case may be, then it shall be a condition to such transaction that (i) First American or the Spin-off Successor, as the case may be, shall provide written notice of such transfer to Experian as soon as practicable and in any event no later than five (5) Business Days prior to such transfer, and (ii) the Affiliate of First American or the Spin-off Successor, as the case may be, shall agree to be liable for its pro rata portion of the Put Price or the Call Price based upon the percentage of the interests in FARES not owned by Experian which are owned by such Affiliate as of the date of the exercise of the Put Option or the Call Option.

4.07. Amendment, Modification and Termination. The provisions of this Agreement may be waived, altered, amended, modified, or repealed, in whole or in part, only by the written consent of First American or the Spin-off Successor, as the case may be, FARES and Experian. This Agreement shall terminate upon closing of the Put Option or the Call Option; provided any such termination shall not affect any rights or obligations (whether based upon breach or otherwise) prior to such termination.

4.08. Further Actions. Each of the Parties hereto agrees that, subject to its legal obligations, it will use commercially reasonable efforts to do all things reasonably necessary to consummate the transactions contemplated hereby.

4.09. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, and all of which together shall be deemed to be one and the same instrument.

4.10. Applicable Law; Submission to Jurisdiction.

(a) This Agreement and the legal relations between the Parties hereto shall be governed by and construed in accordance with the laws of the State of California, without regard to the conflict of laws rules thereof.

13

(b) Each of the Parties agrees that any legal action or proceeding with respect to this Agreement may be brought in the Courts of the State of California or the United States District Court for the Central District of California and, by execution and delivery of this Agreement, each Party hereby irrevocably submits itself in respect of its property, generally and unconditionally to the non-exclusive jurisdiction of the aforesaid courts in any legal action or proceeding arising out of this Agreement. Each of the Parties hereby irrevocably waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in connection with this Agreement brought in the courts referred to in the preceding sentence. Each Party consents to process being served in any such action or proceeding by the mailing of a copy thereof to the address for notices to it set forth in Section 4.03 and agrees that such service upon receipt shall constitute good and sufficient service of process or notice thereof. Nothing in this paragraph shall affect or eliminate any right to serve process in any other matter permitted by law.

4.11. Severability. If any term, provision, covenant or restriction contained in this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void, unenforceable or against its regulatory policy, the remainder of the terms, provisions, covenants and restrictions contained in this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

[Remainder of page intentionally left blank.]

14

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed in their respective corporate names by their respective officers, each of whom is duly and validly authorized and empowered, all as of the day and year first above written.

EXPERIAN INFORMATION SOLUTIONS, INC.
By:	/s/ Scott Leslie
Name:	Scott Leslie
Title:	Secretary
THE FIRST AMERICAN CORPORATION
By:	/s/ Kenneth D. DeGiorgio
Name:	Kenneth D. DeGiorgio
Title:	Senior Vice President
FIRST AMERICAN REAL ESTATE INFORMATION SERVICES INC.
By:	/s/ Kenneth D. DeGiorgio
Name:	Kenneth D. DeGiorgio
Title:	Vice President
FIRST AMERICAN REAL ESTATE SOLUTIONS LLC
By:	/s/ Kenneth D. DeGiorgio
Name:	Kenneth D. DeGiorgio
Title:	Vice President

-Signature Page-

Amended and Restated

Contribution Agreement

EX-10.(OOO)

Exhibit (10)(ooo)

[Execution Copy]

AMENDED AND RESTATED

OPERATING AGREEMENT

FOR

FIRST AMERICAN REAL ESTATE SOLUTIONS LLC,

A CALIFORNIA LIMITED LIABILITY COMPANY

By and Between

FIRST AMERICAN REAL ESTATE INFORMATION SERVICES, INC.,

and

EXPERIAN INFORMATION SOLUTIONS, INC.

Dated as of December 31, 2009

TABLE OF CONTENTS¹/

		Page
ARTICLE I	DEFINED TERMS; CONSTRUCTION	2
1.01	Defined Terms	2
1.02	Construction	8
ARTICLE II	ORGANIZATIONAL MATTERS	9
2.01	Formation of the Company	9
2.02	Capital Contributions; Membership Interests	9
2.03	Name of the Company	11
2.04	Term	11
2.05	Principal Office and Registered Agent	11
2.06	Addresses of the Members and the Managers	11
2.07	Purpose and Business of the Company	11
ARTICLE III	THE MEMBERS	12
3.01	Limited Liability	12
3.02	Admission of Additional Members	12
3.03	Termination of Membership Interest	12
3.04	Absence of Management Powers	12
3.05	Unanimous Consent of Members	12
ARTICLE IV	MANAGEMENT COMMITTEE; MAJOR DECISIONS	13
4.01	Management By Management Committee	13
4.02	Management Committee Representation; Officers	13
4.03	Major Decisions	13
4.04	Additional Capital	15
4.05	Voluntary Loans	17
ARTICLE V	ALLOCATIONS OF NET PROFITS AND NET LOSSES; DISTRIBUTIONS	17
5.01	Allocations of Net Profit and Net Loss	17
5.02	Special Allocations	17
5.03	Tax Incidents	19
5.04	Code Section 704(c) Allocations	19
5.05	Allocations of Net Profits and Losses and Distributions in Respect of a Transferred Interest	20
5.06	Distributions by the Company	20

^1/ This Table of Contents is provided for convenience only, and does not form a part of the attached Amended and Restated Operating Agreement.

i

5.07	Form of Distribution	21
5.08	Restriction on Distributions	21
5.09	Return of Distributions	22
5.10	Withholding Taxes	22
ARTICLE VI	MEMBERSHIP INTEREST TRANSFER RESTRICTIONS	23
6.01	Transfer Restrictions	23
6.02	Further Restrictions on Transfer of Interests	23
6.03	Void Transfer	23
6.04	Permitted Transfers	24
6.05	Third-Party Offers	25
6.06	Special Sale Right	26
ARTICLE VII	BUSINESS OPPORTUNITIES	26
ARTICLE VIII	CONSEQUENCES OF DISSOLUTION EVENTS; TERMINATION OF MEMBERSHIP INTEREST	27
8.01	Dissolution Event	27
8.02	Withdrawal	27
8.03	Purchase Price	28
8.04	Notice of Intent to Purchase	28
8.05	Purchase Pro Rata	28
8.06	Winding Up the Company	28
8.07	Final Statement	29
ARTICLE IX	BOOKS AND RECORDS; TAX RETURNS; ACCESS BY MEMBERS	29
9.01	Company Books and Records	29
9.02	Tax Returns	29
9.03	Inspection, Audit and Copies of Records	30
9.04	Access	30
ARTICLE X	MISCELLANEOUS	30
10.01	Specific Performance	30
10.02	Amendments and Modifications	30
10.03	Notices	31
10.04	Attorneys’ Fees	32
10.05	Further Assurances	32
10.06	Counterparts	32
10.07	Governing Law	32
10.08	Successors	32
10.09	Severability	33
10.10	Entire Agreement	33
10.11	Confidentiality	33

ii

AMENDED AND RESTATED OPERATING AGREEMENT FOR FIRST AMERICAN REAL ESTATE SOLUTIONS LLC, a California limited liability company (the “Company”), dated as of December 31, 2009, by and between FIRST AMERICAN REAL ESTATE INFORMATION SERVICES, INC., a California corporation (“FAREISI”), and EXPERIAN INFORMATION SOLUTIONS, INC., an Ohio corporation (“Experian”).

W I T N E S S E T H:

WHEREAS, pursuant to that certain Contribution and Joint Venture Agreement, dated as of November 30, 1997, by and among First American Appraisal Services, Inc., a California corporation, First American Appraisal Consulting Services, Inc., a California corporation, First American CREDCO, Inc., a Washington corporation, First American Field Services, Inc., a New Jersey corporation, First American Flood Data Services, Inc., a Texas corporation, First American Property Services, Inc., a New York corporation, First American Real Estate Tax Service, Inc., a Florida corporation, Pasco Enterprises, Inc., a Texas corporation, Prime Credit Reports, Inc., a California corporation, Property Financial Services of New England, Inc., a Delaware Corporation, Docs Acquisition Corp., a Nevada corporation, Strategic Mortgage Services, Inc. (Texas), a Texas Corporation (the foregoing entities, collectively, the “First American Companies”), The First American Corporation, a California corporation (“First American”), FAREISI and Experian, as amended and restated by the Amended and Restated Contribution and Joint Venture Agreement, dated on or about the date hereof, by and among First American, FAREISI and Experian (as amended, supplemented or otherwise modified from time to time, the “JV Agreement”), FAREISI, the First American Companies and Experian entered into that certain Operating Agreement of the Company, dated as of November 30, 1997 (the “Original Operating Agreement”);

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies) and Experian are parties to that certain Agreement of Amendment dated as of June 30, 2003 (the “First Amendment”) pursuant to which, among other things, the Original Operating Agreement was amended;

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies) and Experian are parties to that certain Second Agreement of Amendment dated as of September 23, 2003 (the “Second Amendment”) pursuant to which, among other things, the Original Operating Agreement was further amended;

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies) Experian and the Company are parties to that certain Omnibus Agreement dated as of March 22, 2005, as amended and restated by that certain Amended and Restated Omnibus Agreement dated as of June 22, 2005, as further amended by that certain Amendment No. 1 to Amended and Restated Omnibus Agreement dated as of November 10, 2009 (as so amended and restated and further amended, the “Omnibus Agreement”) pursuant to which, among other things, the Original Operating Agreement was further amended and the Parties entered into certain arrangements with regard to the Company;

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies) and Experian are parties to that certain Fourth Agreement of Amendment dated as of

1

February 1, 2007 (the “Fourth Amendment”) pursuant to which, among other things, the Original Operating Agreement was further amended;

WHEREAS, First American (for itself and on behalf of FAREISI and the First American Companies) and Experian are parties to that certain Fifth Agreement of Amendment dated as of November 10, 2009 (the “Fifth Amendment”) pursuant to which, among other things, the Original Operating Agreement was further amended (the Original Operating Agreement, as amended by the First Amendment, the Second Amendment, the Omnibus Agreement, the Fourth Amendment and the Fifth Amendment is hereinafter referred to as the “Existing Operating Agreement”);

WHEREAS, each of the First American Companies has merged with and into FAREISI or their rights and obligations have otherwise been assumed by FAREISI; and

WHEREAS, FAREISI and Experian desire to amend and restate the Existing Operating Agreement as provided herein.

NOW, THEREFORE, the parties hereto hereby amend and restate the Existing Operating Agreement in its entirety as follows:

ARTICLE I

DEFINED TERMS; CONSTRUCTION

1.01 Defined Terms. As used in this Agreement, the following terms shall have the following meanings:

“Accelerated Call Closing Date” has the meaning set forth in the JV Agreement.

“Accelerated Put Closing Date” has the meaning set forth in the JV Agreement.

“Act” means the Beverly-Killea Limited Liability Company Act, codified in the Corporations Code, Section 17000 et seq., as the same may be amended from time to time.

“Adjusted Capital Account Deficit” means, with respect to any Member, the deficit balance, if any, in such Member’s Capital Account as of the end of the applicable Fiscal Year after (i) crediting thereto any amounts which such Member is, or is deemed to be, obligated to restore pursuant to Treasury Regulations §1.704-2(g)(1) and §1.704-2(i)(5) and (ii) debiting such Capital Account by the amount of the items described in Treasury Regulations §1.704-1(b)(2)(ii)(d)(4), (5) and (6). The foregoing definition of Adjusted Capital Account Deficit is intended to comply with the provisions of Treasury Regulation §1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

“Adjustment Date” has the meaning set forth in Section 2.02(g) hereof.

“Affiliate” means and includes, with reference to any Person, any other Person, other than the Company, Controlling, Controlled by or under common Control with such Person.

2

“Agreement” means this Amended and Restated Operating Agreement, as the same may be amended, modified and/or supplemented from time to time.

“Articles” means the Articles of Organization for the Company originally filed with the California Secretary of State and as amended from time to time.

“Bankruptcy” means, with respect to any Person, the occurrence of one or more of the following events: (i) such Person commences a voluntary case concerning itself under Title 11 of the United States Code entitled “Bankruptcy,” as now or hereafter in effect, or any successor thereto (the “Bankruptcy Code”); (ii) an involuntary case is commenced against such Person and the petition is not controverted within 10 days, or is not dismissed within 60 days, after commencement of the case; (iii) a custodian (as defined in the Bankruptcy Code) is appointed for, or takes charge of, all or substantially all of the property of, such Person; (iv) such Person commences any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect; (v) there is commenced against such Person any such proceeding which remains undismissed for a period of 60 days; (vi) such Person is adjudicated insolvent or bankrupt or any order of relief or other order approving any such case or proceeding is entered; (vi) such Person suffers the appointment of a custodian or the like for it or any substantial part of its property to continue undischarged or unstayed for a period of 60 days; (vii) such Person makes a general assignment for the benefit of creditors; or (viii) any corporate or partnership action is taken by such Person for the purpose of effecting any of the foregoing.

“Break-up Fee” has the meaning set forth in Section 6.06 hereof.

“Business Day” means any day, excluding Saturday, Sunday or any day which shall be a legal holiday in the State of California.

“By-Laws” means the By-Laws as initially adopted by the Management Committee and as the same may be amended from time to time.

“Call Closing Date” has the meaning set forth in the JV Agreement.

“Call Option” has the meaning set forth in the JV Agreement.

“Call Price” has the meaning set forth in the JV Agreement.

“Capital Account” means with respect to any Member the capital account which the Company establishes and maintains for such Member pursuant to Section 2.02(b).

“Capital Contribution” means, with respect to any Member, the total amount of cash and the fair market value of property contributed (net of liabilities secured by such contributed property that the Company is considered to assume or take subject to under Section 752 of the Code) to the Company by such Member.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, the provisions of any succeeding law.

3

“Company” has the meaning set forth in the introductory paragraph of this Agreement.

“Company Development Opportunity” means any business opportunity related to real estate lending specifically involving the acquisition, development, construction, operation or management of appraisal services, flood compliance, real estate tax reporting, tax certification, tax outsourcing, mortgage assignments, tax valuation, real property field services and real estate transaction document preparation. For the avoidance of doubt “Company Development Opportunity” does not include businesses of the type currently conducted on the date hereof by Data Tree LLC, First Indian Corporation, Private Limited, Smart Title Solutions LLC, Data Trace Information Services LLC, Accu-Search, Inc., Data Trace Abstractor Services LLC, Title Records, Inc., Signature Information Solutions LLC, First American Real Estate Solutions II LLC, Data Trace Information Services II LLC or The Hyper-Abstract Corporation, including, without limitation, title plant maintenance, acquisition or marketing, the creation, compilation or sale of imaged documents and the abstracting of real estate related and other records.

“Company Minimum Gain” has the meaning given to the term “partnership minimum gain” in the Regulations §s 1.704-2(b)(2) and 1.704-2(d).

“Control” means the power to vote more than 50% of the Voting Interests of an Entity or to otherwise control the management and affairs of such Entity (including by way of the power to veto any material act or decision). Controlled and Controlling shall have co-relative meanings.

“CoreLogic” means First American CoreLogic, Inc., a Delaware corporation.

“Corporations Code” means the California Corporations Code, as amended from time to time, and the provisions of succeeding law.

“Covered Period” has the meaning set forth in Section 5.06(a)(ii)(1) hereof.

“Dissolution Event” means, with respect to any Member, the withdrawal from this Agreement, the Bankruptcy, the dissolution or the termination of such Member.

“Distributable Cash” means the amount of cash which the Management Committee deems available for distribution to the Members, taking into account all debts, liabilities, and obligations of the Company then due, and working capital and other amounts which the Management Committee deems necessary for the Company’s business or to place into reserves for customary and usual claims with respect to such business.

“Entity” means any Person that is not a natural Person.

“Experian” has the meaning set forth in the introductory paragraph of this Agreement.

“Experian Managers” has the meaning set forth in Section 4.02(a) hereof.

“Experian Transaction Expenses” has the meaning set forth in Section 6.06 hereof.

4

“FAREISI” has the meaning set forth in the introductory paragraph of this Agreement; provided, however that from and after any transfer of a Membership Interest pursuant to the second sentence of 6.04(b), “FAREISI” shall be deemed to refer to any transferee pursuant to such transfer so long as it remains a Member.

“FAREISI Managers” has the meaning set forth in Section 4.02(a) hereof.

“First Advantage” means First Advantage Corporation, a Delaware corporation.

“First American” has the meaning set forth in the first WHEREAS clause of this Agreement.

“First American Companies” has the meaning set forth in the first WHEREAS clause of this Agreement.

“Fiscal Year” means the Company’s fiscal year, which shall be the calendar year.

“Former Member” has the meaning set forth in Section 8.01 hereof.

“Former Member’s Interest” has the meaning set forth in Section 8.01 hereof.

“GAAP” means generally accepted accounting principles in the United States of America applied on a consistent basis and reasonable under the circumstances.

“JV Agreement” has the meaning set forth in the first WHEREAS clause of this Agreement.

“Major Decision” has the meaning set forth in Section 4.03 hereof.

“Manager” has the meaning set forth in Section 4.01 hereof.

“Management Committee” means the Management Committee of the Company.

“Member” means each Person who (a) is an initial signatory to this Agreement or has been admitted to the Company as a Member in accordance with the Articles or this Agreement and (b) has not become the subject of a Dissolution Event or ceased to be a Member in accordance with Article VIII or for any other reason.

“Member Minimum Gain” means an amount, determined in accordance with Regulations § 1.704-2(i)(3) with respect to any Member Nonrecourse Debt, equal to the Company Minimum Gain that would result if such Member Nonrecourse Debt were treated as a Nonrecourse Liability.

“Member Nonrecourse Debt” has the meaning given to the term “partner nonrecourse debt” in Regulations § 1.704-2(b)(4).

“Member Nonrecourse Deductions” has the meaning given to the term “partner nonrecourse deductions” in Regulations § 1.704-2(i).

5

“Membership Interest” means a Member’s entire interest in the Company, including, without limitation, the right to receive distributions of the Company’s assets and allocations of income, gain, loss, deduction, credit and similar items from the Company pursuant to this Agreement and the Act, the right to vote on or participate in the management, and the right to receive information concerning the business and affairs, of the Company.

“Net Profits” and “Net Losses” means, for each Fiscal Year, an amount equal to the Company’s taxable income or loss for such Fiscal Year, determined in accordance with Section 703(a) of the Code (but including in taxable income or loss, for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code), with the following adjustments:

(a) any income of the Company exempt from federal income tax and not otherwise taken into account in computing Net Profit or Net Loss pursuant to this definition shall be added to such taxable income or loss;

(b) any expenditures of the Company described in Section 705(a)(2)(B) of the Code (or treated as expenditures described in Section 705(a)(2)(B) of the Code pursuant to Regulations § 1.704-1(b)(2)(iv)(i)) and not otherwise taken into account in computing Net Profit or Net Loss pursuant to this definition shall be subtracted from such taxable income or loss;

(c) in the event the fair market value of any Company asset is adjusted in accordance with Section 2.02(c), the amount of such adjustment shall be taken into account as gain or loss from the disposition of such asset for purposes of computing Net Profit or Net Loss;

(d) gain or loss resulting from any disposition of any asset of the Company with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the book value of the asset disposed of under Treasury Regulations § 1.704-1(b)(2)(iv), notwithstanding that the adjusted tax basis of such asset differs from such book value; and

(e) notwithstanding any other provision of this definition, any items which are allocated under Section 5.02 shall not be taken into account in the computation of “Net Profit” or “Net Loss.”

“Nonrecourse Deduction” has the meaning given to such term in Regulations § 1.704-2(b)(1).

“Nonrecourse Liability” has the meaning set forth in Regulations § 1.704-2(b)(3).

“Offer” has the meaning set forth in Section 6.04(c) hereof.

“Offered Interest” has the meaning set forth in Section 6.04(c) hereof.

“Offering Price” has the meaning set forth in Section 6.04(c) hereof.

6

“Offer Notice” has the meaning set forth in Section 6.04(c) hereof.

“Offer Rejection” has the meaning set forth in Section 6.04(d) hereof.

“Offer Terms” has the meaning set forth in Section 6.04(c) hereof.

“Percentage Interest” means, with respect to a Member, the percentage set forth in Section 2.02(f) with respect to such Member, as such percentage may be adjusted from time to time pursuant to the terms of this Agreement.

“Permitted Transfer” has the meaning set forth in Section 6.04(a) hereof.

“Permitted Transferee” has the meaning set forth in Section 6.04(a) hereof.

“Person” means and includes any individual, partnership, association, joint stock company, joint venture, corporation, trust, limited liability company, unincorporated organization or other enterprise or any government or political subdivision or any agency, department or instrumentality thereof.

“Prime Rate” means, as of any date of determination, the per annum rate of interest specified as the Prime Rate in The Wall Street Journal published on such date, provided that for any date on which the Wall Street Journal is not published, “Prime Rate” means the per annum rate of interest specified as the Prime Rate in The Wall Street Journal last published before such date.

“Proposed Transferee” has the meaning set forth in Section 6.04(c) hereof.

“Put Closing Date” has the meaning set forth in the JV Agreement.

“Put Option” has the meaning set forth in the JV Agreement.

“Put Price” has the meaning set forth in the JV Agreement.

“Regulations” shall, unless the context clearly indicates otherwise, mean the regulations in force as final or temporary that have been issued by the U.S. Department of Treasury pursuant to its authority under the Code, and any successor regulations.

“Remaining Members” has the meaning set forth in Section 8.01 hereof.

“Requested Amount” has the meaning set forth in Section 4.04(b) hereof.

“Secretary” means the Secretary of the Company appointed by the Management Committee.

“Special Put Closing Date” has the meaning set forth in the JV Agreement.

“Special Put Option” has the meaning set forth in the JV Agreement.

“Spin-off Successor” has the meaning set forth in the JV Agreement.

7

“Tax Allowance Amount” means, with respect to any Member, 40% (which percentage the Management Committee may from time to time hereafter, upon the unanimous vote of the Managers, adjust to reflect material changes in tax rates) of the greater of (A) such Member’s share of the estimated net taxable income allocable to such Member arising from its ownership of an interest in the Company or (B) such Member’s share of Net Profits, in either case, after subtracting from (A) or (B), as the case may be, the Company’s equity in the earnings of First Advantage and after subtracting the net profits of CoreLogic (to the extent otherwise included in net taxable income or Net Profits, as the case may be), plus any dividends paid by First Advantage and CoreLogic to the Company, in each case for the period for which such payment of taxes is being made.

“Third-Party Offer” has the meaning set forth in Section 6.05 hereof.

“Third-Party Terms” has the meaning set forth in Section 6.05 hereof.

“Transfer” means any sale, transfer, assignment, donation, pledge, hypothecation, encumbrance or other disposition in any manner whatsoever, voluntarily or involuntarily, including, without limitation, any attachment, assignment for the benefit of creditors or transfer by operation of law or otherwise.

“Transfer Notice” has the meaning set forth in Section 6.04(e) hereof.

“Voluntary Loans” has the meaning set forth in Section 4.05(a) hereof.

“Voting Interest” means with respect to any Entity, any equity interest of such Entity having general voting power under ordinary circumstances to participate in the election of a majority of the governing body of such Entity (irrespective of whether at the time any other class or classes of equity interest of such Entity shall have or might have voting power by reason of the happening of any contingency).

1.02 Construction.

(a) To the fullest extent permissible, each of FAREISI, Experian and the Company hereby waives such provisions of the Corporations Code as are inconsistent with the terms hereof.

(b) The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Article, Section and subsection references are to this Agreement unless otherwise specified.

(c) All accounting terms not specifically defined herein shall be construed in accordance with GAAP.

(d) The meanings given to terms used herein shall be equally applicable to both the singular and plural forms of such terms.

8

(e) The Table of Contents hereto and the Article and Section headings herein are for convenience only and shall not affect the construction hereof.

(f) This Agreement is the result of negotiations between the Members and has been reviewed by counsel to the Members and is the product of both Members. Accordingly, this Agreement shall not be construed against any Member merely because of such Member’s involvement in its preparation.

ARTICLE II

ORGANIZATIONAL MATTERS

2.01 Formation of the Company. The Members formed a California limited liability company under the laws of the State of California by filing the Articles with the California Secretary of State and entering into the Original Operating Agreement. The rights and liabilities of the Members shall be determined pursuant to the Act and this Agreement. To the extent that the rights or obligations of any Member are different by reason of any provision of this Agreement than they would be in the absence of such provision, this Agreement shall, to the extent permitted by the Act, control.

2.02 Capital Contributions; Membership Interests.

(a) First American and FAREISI have previously caused the First American Companies to contribute to the Company certain assets and liabilities as their respective initial Capital Contribution. Experian has previously contributed to the Company certain assets and liabilities as its initial Capital Contribution. No Member shall be required to make any additional Capital Contributions; provided, however, that the Members may be permitted to make additional Capital Contributions if and to the extent they so desire, only in accordance with the provisions of Section 4.04.

(b) The Company shall establish and maintain a separate Capital Account for each Member in accordance with Regulations § 1.704-1(b)(2)(iv). Without limiting the foregoing, each Member shall receive a credit to its Capital Account in the amount of (i) the amount of any Capital Contribution made in cash, (ii) the fair market value (net of liabilities that the Company is considered to assume, or take subject to, under Section 752 of the Code) of any Capital Contribution made in property other than cash, and (iii) allocations to such Member of Net Profits. Each Member’s Capital Account shall be debited with (i) the amount of any cash and the fair market value of property distributed to such Member (net of liabilities that such Member is considered to assume or take subject to Section 752 of the Code), all as may be determined in accordance with this Agreement, and (ii) allocations of Net Losses. If a Member transfers all or a part of its Membership Interest in accordance with this Agreement, such Member’s Capital Account attributable to the transferred Membership Interest shall carry over to the new owner of such Membership Interest pursuant to Regulations § 1.704-1(b)(2)(iv)(l). If any property other than cash is distributed to a Member, the Capital Accounts of the Members shall be adjusted as if the property had instead been sold by the Company for a price equal to its fair market value and the proceeds distributed. Upon liquidation and winding-up of the Company, any unsold Company property shall be valued to determine the gain or loss which would result if such property were sold at its fair market value at the time of such liquidation. The Capital Accounts

9

of the Members shall be adjusted to reflect how any such gain or loss would have been allocated under Article V if such property had been sold at the assigned values. No Member shall be obligated to restore any negative balance in its Capital Account. No Member shall be compensated for any positive balance in its Capital Account except as otherwise expressly provided herein. The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with the provisions of Regulations § 1.704-1(b)(2) and shall be interpreted and applied in a manner consistent with such Regulations.

(c) The Capital Accounts of the Members shall be increased or decreased in accordance with Regulations § 1.704-1(b)(2)(iv)(f) to reflect a revaluation of the property of the Company on the Company’s books as of the following times: (i) the acquisition of an additional interest in the Company by any new or existing Member in exchange for more than a de minimis capital contribution; (ii) the distribution by the Company to a Member of more than a de minimis amount of money or other property as consideration for an interest in the Company; and (iii) the liquidation of the Company within the meaning of Regulations § 1.704-1(b)(2)(ii)(g); provided, however, that adjustments pursuant to clause (i) and clause (ii) of this sentence shall be made only if the Management Committee reasonably determines that such adjustments are necessary or appropriate to reflect the relative economic interests of the Members in the Company or in all events in connection with an adjustment to Percentage Interests pursuant to Section 2.02(h).

(d) Except as provided herein, no Member shall be entitled to receive any interest or other earnings on its Capital Contributions.

(e) Except upon the dissolution of the Company or as may be specifically provided in this Agreement, no Member shall have the right to demand or receive the return of all or any part of its Capital Account or its capital contributions to the Company.

(f) The Percentage Interests of the Members as of the date of this Agreement are 80% with respect to FAREISI and 20% with respect to Experian.

(g) Notwithstanding anything to the contrary contained in this Agreement, on or prior to the earlier of December 31, 2010 and the date on which the Put Option or the Call Option is exercised (such earlier date, the “Adjustment Date”), without the prior written consent of Experian:

(1) Experian shall not be required to make additional Capital Contributions in order to maintain its Percentage Interest of 20%, and,

(2) no Capital Contribution made by any other Member shall cause Experian’s Percentage Interest to be decreased below 20%.

(h) In the event that a Member makes one or more Capital Contributions after the date of this Agreement and on or prior to the Adjustment Date pursuant to Section 4.04(a), on the day after the Adjustment Date, the Percentage Interest of each Member shall be adjusted by the Management Committee to reflect the relative proportions of the Capital Accounts of the Members. Such adjustment shall be made by: first, adjusting the Capital Accounts of all Members to reflect the fair market value of the Company’s tangible and intangible assets (including goodwill) and shall include any unrealized income, gain, loss or deduction in

10

Company assets immediately prior to the additional Capital Contributions; second, determining relative proportions of the Capital Accounts, taking into account the new Capital Contributions; and third, adjusting the Percentage Interests to reflect the relative portions of the Capital Accounts as so adjusted. In the event that (i) one or more Capital Contributions are made by Members other than Experian after the date of this Agreement and prior to December 31, 2010 and (ii) the Put Option or the Call Option is not exercised on or before December 31, 2010, Experian shall have the right, exercisable once and payable to the Company in cash no later than January 31, 2011, to make a catch up Capital Contribution to the Company in order to maintain its Percentage Interest at 20%, the amount of which shall be reasonably determined in good faith by the Management Committee.

2.03 Name of the Company. The name of the Company shall be “First American Real Estate Solutions LLC.” The business of the Company may be conducted under that name or, upon compliance with applicable laws, any other name that the Management Committee deems appropriate or advisable. Notwithstanding the preceding sentence, at the sole written direction of a FAREISI Manager to the Company, the Company shall remove references to “First American” from the Company’s name, websites, brochures, stationary and other written materials as soon as practicable and the Company shall cease using the name “First American” in the conduct of its business. The Managers shall file any fictitious name certificates and similar filings, and any amendments thereto, that the Management Committee considers appropriate or advisable. Notwithstanding the foregoing, the Company shall not use the name “Experian” in the conduct of its business except as otherwise agreed to in writing by Experian.

2.04 Term. Unless terminated as hereinafter provided, this Agreement shall continue in perpetuity.

2.05 Principal Office and Registered Agent. The Company shall continuously maintain an office and registered agent in the State of California. The principal office of the Company shall be located at 1 First American Way, Westlake, Texas 76262 or as the Management Committee may otherwise determine. The Company may also have such offices, anywhere within and without the State of California, as the Management Committee may determine from time to time, or the business of the Company may require. The registered agent shall be as stated in the Articles or as otherwise determined by the Management Committee.

2.06 Addresses of the Members and the Managers. The respective addresses of the Members and the Managers shall be as set forth in the books and records of the Company. A Member shall notify the Management Committee of any change in its address by delivering written notice thereof to the Management Committee at 1 First American Way, Westlake, Texas 76262.

2.07 Purpose and Business of the Company. The purpose of the Company is to engage in any lawful activity for which a limited liability company may be organized under the Act.

11

ARTICLE III

THE MEMBERS

3.01 Limited Liability. Except as expressly set forth in this Agreement or required by law, no Member shall be personally liable for any debt, obligation, or liability of the Company, whether that liability or obligation arises in contract, tort, or otherwise.

3.02 Admission of Additional Members. Except for the admission of substitute Members in accordance with Article VI, no additional Members shall be admitted to the Company.

3.03 Termination of Membership Interest. Upon (a) the transfer of a Member’s Membership Interest in violation of Article VI or (b) the occurrence of a Dissolution Event as to such Member which does not result in the dissolution of the Company under Article VIII, the Membership Interest of a Member shall be terminated by the Management Committee and thereafter that Member shall be entitled only to the amounts set forth in Section 8.03. Each Member acknowledges and agrees that such termination or purchase of a Membership Interest upon the occurrence of any of the foregoing events is not unreasonable under the circumstances existing as of the date hereof.

3.04 Absence of Management Powers. The Members shall have no power to participate in the management of the Company except as expressly authorized by this Agreement or the Articles and except as expressly required by the Act. No Member, acting solely in the capacity of a Member, is an agent of the Company nor does any Member, unless expressly and duly authorized in writing to do so by the Management Committee, have any power or authority to bind or act on behalf of the Company in any way, to pledge its credit, to execute any instrument on its behalf or to render it liable for any purpose.

3.05 Unanimous Consent of Members. Notwithstanding Section 3.04 and Article IV, the following matters shall require the unanimous vote, approval or consent of all Members who are not the subject of a Dissolution Event:

(a) a decision to dissolve the Company or voluntarily terminate this Agreement or voluntarily commence a case concerning itself under the Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar law now or hereafter in effect;

(b) a decision to continue the business of the Company after the occurrence of a Dissolution Event;

(c) any amendment of the Articles other than an amendment that removes the words “First American” from the name of the Company;

(d) prior to the date on which the Put Option or Call Option is exercised, any amendment of the By-Laws;

(e) except as otherwise provided in Section 10.02, any amendment of this Agreement; and

12

(f) a decision to compromise the obligation of a Member to make a Capital Contribution or return money or property paid or distributed in violation of the Act.

ARTICLE IV

MANAGEMENT COMMITTEE; MAJOR DECISIONS

4.01 Management By Management Committee. The business, property and affairs of the Company shall be managed exclusively by the Management Committee. The Management Committee shall consist of ten managers (each, a “Manager”). Except for situations in which the approval of the Members is expressly required by the Articles, the Act or this Agreement, the Management Committee shall have full, complete and exclusive authority, power, and discretion to manage and control the business, property and affairs of the Company, to make all decisions regarding those matters and to perform any and all other acts or activities customary or incident to the management of the Company’s business, property and affairs. Without limiting the generality of the foregoing, but subject to the express limitations set forth elsewhere in this Agreement, the Management Committee shall have the power to exercise on behalf and in the name of the Company all of the powers described in Corporations Code Section 17003.

4.02 Management Committee Representation; Officers.

(a) So long as Experian shall own at least a 10% Membership Interest in the Company, the number of Managers of the Company shall be ten, and FAREISI shall designate eight Managers (the “FAREISI Managers”) and Experian shall designate two Managers of the Company (the “Experian Managers”). FAREISI shall be entitled to remove or replace any FAREISI Manager in its sole discretion upon written notice to Experian and the Company. Experian shall be entitled to remove or replace any Experian Manager in its sole discretion upon written notice to FAREISI and the Company. Each Manager of the Company so designated shall hold office, subject to the applicable provisions of the Articles and By-Laws of the Company, until the next annual meeting of the Members and until their respective successors shall be duly elected or appointed and qualified. Each member of the Management Committee shall have one vote, and the vote of the majority of the members of the Management Committee participating in a meeting of the Management Committee (subject to the quorum requirements set forth in the By-Laws) shall constitute the act of the Management Committee, unless otherwise expressly set forth herein.

(b) The Members acknowledge that the Managers are appointed to represent and serve the interests of the Members who appointed such Managers. The Members agree that no such Manager shall have any liability (including, without limitation, for any claim of breach of fiduciary duty) to the Company or to any Member as a result of taking any action as a Manager, or as an officer or director of a Member, which action the Manager reasonably believes to be in the best interests of the Member he or she represents.

4.03 Major Decisions. So long as Experian shall own at least a 10% Membership Interest in the Company, and subject to the provisions of Sections 4.04 and 4.05 below, the Company shall not take, or permit to occur, any action which would constitute a Major Decision without the prior written consent of the Experian Managers. Notwithstanding the preceding sentence, if the Company seeks the written consent of the Experian Managers to take, or permit

13

to occur, any action which would constitute a Major Decision and the Experian Managers fail to respond to such consent request by the thirtieth (30th) day after such written consent is delivered to the Experian Managers via registered mail, return receipt requested, then the Company shall, without further action, be entitled to take, or permit to occur, any such action. Each of the following acts, events or occurrences shall constitute a “Major Decision”:

(a) any acquisition by the Company of any business of another Person, or of any property, securities, rights or other assets in one or a series of related transactions if the consideration for such acquisition exceeds, in the aggregate, US $15,000,000;

(b) any sale, transfer or other disposition of assets of the Company, other than in the ordinary course of business, with a fair market value at the time of such sale, transfer or disposition exceeding, in the aggregate, US $15,000,000;

(c) the adoption, filing or amendment of any designation of rights, preferences and privileges with respect to any equity security of the Company;

(d) the issuance, redemption or repurchase by the Company of any Membership Interest or any other equity security of the Company to any Person;

(e) other than Voluntary Loans, the borrowing of any sums of money;

(f) the creation of any liens or encumbrances on any of the Company’s assets, other than the creation of liens and encumbrances (i) securing borrowings permitted under paragraph (e) above; (ii) liens for taxes not yet due, or liens for taxes being contested in good faith and by appropriate proceedings for which adequate reserves have been established; (iii) liens in respect of property or assets of the Company imposed by law, which were incurred in the ordinary course of business, including without limitation, carriers’, warehousemen’s and mechanics’ liens and other similar liens arising in the ordinary course of business and (x) which do not in the aggregate materially detract from the value of such property or assets or materially impair the use thereof in the operation of the business of the Company or (y) which are being contested in good faith by appropriate proceedings and for which adequate reserves have been established, which proceedings have the effect of preventing the forfeiture or sale of the property or assets subject to any such lien; (iv) pledges or deposits in connection with worker’s compensation, unemployment insurance and other social security legislation; or (v) constituting purchase money security interests;

(g) except as provided in paragraphs (a) and (b) of this Section 4.03, any loan or other use of the Company’s assets with a fair market value in excess of $5,000,000 to, or the Company making an investment in, any Person not a Member or an Affiliate of a Member; provided, however, the Company may loan or permit the use of the Company’s assets if the fair market value thereof does not singularly or in the aggregate exceed $5,000,000;

14

(h) any change in the character of the business of the Company or the undertaking of any new ventures or transactions or the engaging in any type of business not incidental and directly related to the Company’s present business;

(i) the sale or other disposition of all or substantially all of the assets and property of the Company;

(j) the merger or consolidation of the Company with or into any other limited liability company or any corporation or other entity;

(k) except as contemplated by Sections 4.04 and 4.05, any transaction, whether or not evidenced by a written agreement, between the Company, on the one hand, and First American or the Spin-off Successor, as the case may be, or its Affiliates, on the other hand, involving estimated consideration in excess of $2,000,000 over any twelve-month period (each, an “Affiliate Transaction”); and

(l) any determination by the Company to require that each of First American or the Spin-off Successor, as the case may be, and Experian provide a guaranty to a third party; provided that if the Experian Managers fail to consent to a request for such guaranties, then FAREISI and its Affiliates (including, without limitation, First American or the Spin-off Successor, as the case may be) shall nevertheless have the right, but not the obligation, to provide any such guaranties upon such terms and conditions as they (or any of them) shall determine in their (or its) sole and absolute discretion.

Each Affiliate Transaction must be an arm’s length transaction (assuming relatively equal bargaining power between the parties) and must be fair to the Company and all its Members from an economic perspective in light of all the facts and circumstances existing at the time the Affiliate Transaction is entered into. FAREISI shall deliver to Experian, within thirty days after the conclusion of each fiscal quarter, a summary of all Affiliate Transactions entered into or consummated during such fiscal quarter, in reasonable detail including a description of the transaction and the consideration paid and received by FARES in connection with such transaction.

4.04 Additional Capital.

(a) Upon the approval of any acquisition described in clause (a) of Section 4.03 in accordance with the provisions of Section 4.03, any action thereafter necessary or desirable in respect of such acquisition and any additional terms of such acquisition (including, without limitation, the source and the nature of the capital needed, if any), may be approved by the affirmative vote of a majority of the Managers (whether or not such majority includes the Experian Managers). Without limiting the generality of the foregoing, if, in connection with any such approved acquisition, the Management Committee shall determine that additional capital is required by the Company, the Management Committee may request that each of the Members contribute such additional capital in proportion to the Percentage Interests then held by each of them; provided, however, that on or prior to the Adjustment Date, Experian shall not be required to make additional Capital Contributions in order to maintain its Percentage Interest of 20% and FAREISI shall be permitted to make additional Capital Contributions in excess of its Percentage

15

Interest so long as such Capital Contributions do not result in any decrease in Experian’s Percentage Interest below 20%. Subject to clause (b) below, the Company shall accept from each of FAREISI and Experian a contribution only in the full amount of its share of the additional capital requested. The contribution shall be in such form, cash or otherwise, as the Management Committee shall determine.

(b) Upon receipt by Experian after the Adjustment Date of any request from the Management Committee for an additional capital contribution pursuant to clause (a) above, Experian shall have the option to contribute or decline to contribute such additional capital by delivering a written notice to the Company and FAREISI specifying its election not more than 30 days after its receipt of such request for additional capital (it being understood and agreed that if such written notice is not delivered within the 30 day period provided, Experian shall be deemed to have elected not to contribute such additional capital). In the event that Experian elects not to contribute its proportionate share of additional capital after the Adjustment Date as requested (the “Requested Amount”), FAREISI shall have the right, but not the obligation, to contribute to the Company for its own account as an additional capital contribution the Requested Amount. Experian shall not be considered in breach of this Agreement as a result of its election not to contribute the Requested Amount. Nothing contained in this Section 4.04(b) shall abrogate Experian’s right to make a catch up Capital Contribution pursuant to Section 2.02(h).

(c) If any of the Members makes an additional contribution as provided in this Section 4.04 or if Experian makes a catch up Capital Contribution pursuant to Section 2.02(h), then each such Member shall receive a credit to its respective Capital Account in the amount of any additional capital which it has contributed to the Company. Except as provided in Section 4.04(a) and Section 2.02(g), immediately following such Capital Contributions, the Percentage Interests of the Members shall be adjusted by the Management Committee to reflect the new relative proportions of the Capital Accounts of the Members. Such adjustment shall be made by: first, adjusting the Capital Accounts of all of the Members to reflect the fair market value of the Company’s tangible and intangible assets (including goodwill) and shall include any unrealized income, gain, loss or deduction in Company assets immediately prior to the additional Capital Contributions; second, determining relative proportions of the Capital Accounts, taking into account the new Capital Contributions; and third, adjusting the Percentage Interests to reflect the relative portions of the Capital Accounts as so adjusted.

(d) In the event that the Experian Managers fail to consent pursuant to Section 4.03 hereof to any acquisition described in clause (a) of such Section 4.03 that is proposed by FAREISI or the FAREISI Managers, FAREISI and its Affiliates (including, without limitation, First American or the Spin-off Successor, as the case may be) shall be free to pursue such proposed acquisition and neither the Company nor Experian nor its Affiliates shall have any right, claim or interest in or to any revenues resulting therefrom. In the event that the FAREISI Managers fail to consent pursuant to Section 4.03 hereof to any acquisition described in clause (a) of such Section 4.03 that is proposed by Experian or the Experian Managers, Experian and its Affiliates shall be free to pursue such proposed acquisition and neither the Company nor FAREISI shall have any right, claim or interest in or to any revenues resulting therefrom. In the event that the Company fails to diligently pursue any acquisition described in clause (a) of Section 4.03 that is approved by the Management Committee in accordance with the terms of such Section 4.03, then the party that proposed (or the party whose Managers proposed) such

16

acquisition to the Company shall be free to pursue such acquisition (so long as the Company’s failure to diligently pursue such acquisition is not attributable to such party’s actions) and neither the Company nor any other Member nor any of such Member’s Affiliates shall have any right, claim or interest in or to any revenues resulting therefrom.

4.05 Voluntary Loans. If, at any time or times hereafter, the Management Committee shall determine that additional financing is required by the Company to conduct its business and operations according to its ordinary and usual course of business or in connection with any acquisition described in clause (a) of Section 4.03 and approved by the Management Committee, the Management Committee may request that each of FAREISI and Experian make one or more loans on a voluntary basis to the Company (“Voluntary Loans”). The timing, terms and conditions of each such Voluntary Loan shall be subject to the approval of each of the parties hereto; provided that in no event shall any Voluntary Loan bear interest in excess of the Prime Rate and, if a Voluntary Loan is made by FAREISI and not Experian, the timing, terms and conditions of such Voluntary Loan shall be on an arm’s length basis and must be fair to the Company and all its Members from an economic perspective in light of all the facts and circumstances existing at the time such Voluntary Loan is made.

ARTICLE V

ALLOCATIONS OF NET PROFITS AND NET LOSSES; DISTRIBUTIONS

5.01 Allocations of Net Profit and Net Loss. Subject to Section 5.02,

(a) Net Loss. Net Loss shall be allocated to the Members in proportion to their Percentage Interests. Notwithstanding the previous sentence, losses allocated to a Member shall not exceed the maximum amount of losses that can be allocated without causing a Member to have an Adjusted Capital Account Deficit at the end of any Fiscal Year. In the event that any Member would have an Adjusted Capital Account Deficit as a consequence of an allocation of losses in proportion to Percentage Interests, the amount of losses that would be allocated to such Member but for such allocation shall be allocated to the other Members to the extent that such allocations would not cause such other Members to have an Adjusted Capital Account Deficit and allocated among such other Members in proportion to their Percentage Interests. Any allocation of items of loss pursuant to this Section 5.01(a) shall be taken into account in computing subsequent allocations pursuant to this Article V, and prior to any allocation of items in such Section so that the net amount of any items allocated to each Member pursuant to this Article V shall, to the maximum extent practicable, be equal to the net amount that would have been allocated to each Member pursuant to this Article V if no reallocation of losses had occurred under this Section 5.01(a).

(b) Net Profit. Net Profit shall be allocated to the Members in proportion to their Percentage Interests.

5.02 Special Allocations. Notwithstanding Section 5.01, the following special allocations shall be made in the following order:

(a) Minimum Gain Chargeback. If there is a net decrease in Company Minimum Gain during any Fiscal Year, each Member shall be specially allocated items of Company

17

income and gain for such Fiscal Year (and, if necessary, in subsequent fiscal years) in an amount equal to such Member’s share of the net decrease in Company Minimum Gain, determined in accordance with Regulations § 1.704-2(g)(2). Allocations pursuant to this Section 5.02(a) shall be made in proportion to the respective amounts required to be allocated to each Member under this Section 5.02(a). The items to be so allocated shall be determined in accordance with Regulations §s 1.704-2(f)(6) and 1.704-2(j)(2). This Section 5.02(a) is intended to comply with the minimum gain chargeback requirement contained in Regulations § 1.704-2(f) and shall be interpreted consistently therewith. To the extent permitted by such Regulations and for purposes of this Section 5.02(a) only, each Member’s net increase in Company Minimum Gain shall be determined prior to any other allocations pursuant to this Article V with respect to such Fiscal Year and without regard to any net decrease in Company Minimum Gain during such Fiscal Year.

(b) Chargeback of Minimum Gain Attributable to Member Nonrecourse Debt. If there is a net decrease in Member Minimum Gain attributable to Member Nonrecourse Debt, during any Fiscal Year, each member who has a share of the Member Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Regulations § 1.704-2(i)(5), shall be specially allocated items of Company income and gain for such Fiscal Year (and, if necessary, in subsequent Fiscal Years) in an amount equal to such Member’s share of the net decrease in Member Minimum Gain, determined in accordance with Regulations § 1.704-2(i)(4). Allocations pursuant to this Section 5.02(b) shall be made in proportion to the amounts required to be allocated to each Member under this Section 5.02(b). The items to be so allocated shall be determined in accordance with Regulations §s 1.704-2(i)(4) and 1.704-2(j)(2)(ii). This Section 5.02(b) is intended to comply with the minimum gain chargeback requirement contained in Regulations § 1.704-2(i)(4) and shall be interpreted consistently therewith. Solely for purposes of this Section 5.02(b), each Member’s net decrease in Member Minimum Gain shall be determined prior to any other allocations pursuant to this Article V with respect to such Fiscal Year, other than allocations pursuant to Section 5.02(a).

(c) Qualified Income Offset. If a Member unexpectedly receives any adjustments, allocations, or distributions described in Regulations § 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of Company income and gain shall be specifically allocated to each such Member in an amount and manner sufficient to eliminate, to the extent required by the Regulations, the Adjusted Capital Account Deficit of such Member as quickly as possible, provided that an allocation pursuant to this Section 5.02(c) shall be made if and only to the extent that such Member would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article V have been tentatively made as if this Section 5.02(c) were not in this Agreement. The foregoing provision is intended to comply with Regulations § 1.704-1(b)(2)(ii)(d) and shall be interpreted and applied in a manner consistent with such Regulations.

(d) Gross Income Allocation. In the event that any Member has an Adjusted Capital Account Deficit at the end of any Fiscal Year, then each such Member shall be specially allocated items of income in the amount of such excess as quickly as possible, provided that an allocation pursuant to this Section 5.02(d) shall be made if and only to the extent that such Member would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article V have been tentatively made as if this Section 5.02(d) were not in this Agreement.

18

(e) Nonrecourse Deductions. Any nonrecourse deductions (as defined in Regulations § 1.704-2(b)(1)) for any Fiscal Year or other period shall be specially allocated to the Members in proportion to their then respective Percentage Interests.

(f) Member Nonrecourse Deductions. Those items of Company loss, deduction, or Code Section 705(a)(2)(B) expenditures which are attributable to Member Nonrecourse Debt for any Fiscal Year or other period shall be specially allocated to the Member who bears the economic risk of loss with respect to the Member Nonrecourse Debt to which such items are attributable in accordance with Regulations § 1.704-2(i).

(g) Section 754 Adjustments. To the extent an adjustment to the adjusted tax basis of any Company asset pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulations § 1.704-1(b)(2)(iv)(m)(2) or Treasury Regulations § 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Member in complete liquidation of its interest in the Company, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated to the Members in a manner consistent with the manner in which their Capital Accounts are required to be adjusted pursuant to such Regulations.

(h) Curative Allocations. It is the intent of the Members that, to the extent possible, the allocations set forth in the foregoing provisions of this Section 5.02 will be offset with special allocations of other items of Company income, gain, loss, and deduction pursuant to this Section 5.02(h). Therefore, notwithstanding any other provision of this ARTICLE V (other than Section 5.02 hereof), the Management Committee shall make such offsetting special allocations of Company income, gain, loss, or deduction in whatever manner the Management Committee determines to be appropriate so that, after such offsetting allocations are made, each Member’s Capital Account balance is, to the extent possible, equal to the Capital Account balance such Member would have had if the allocations set forth in the foregoing provisions of this Section 5.02 were not part of this Agreement. In exercising its discretion under this Section 5.02(h), the Management Committee shall take into account future allocations under Sections 5.02(a) and 5.02(b) that, although not yet made, are likely to offset other allocations previously made under Sections 5.02(e) and 5.02(f).

5.03 Tax Incidents. It is intended that the Company will be treated as a pass-through entity for tax purposes. Subject to Section 704(c) of the Code, for U.S. federal and state income tax purposes, all items of Company income, gain, loss, deduction, credit and any other allocations not otherwise provided for shall be allocated among the Members in the same manner as the corresponding item of income, gain, loss or deduction was allocated, separately or as part of Net Profits or Net Losses, pursuant to the preceding Sections of this ARTICLE V.

5.04 Code Section 704(c) Allocations. In accordance with Section 704(c) of the Code and the Regulations thereunder, income, gain, loss and deduction with respect to any property contributed to the capital of the Company, or any property owned by the Company at the time of any revaluation of the Company’s assets pursuant to Section 2.02(c), shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted tax basis of such property to the Company for federal income tax purposes and its fair

19

market value at the time of contribution or revaluation. Any elections or decisions relating to such allocations shall be made by the Management Committee in a manner that reasonably reflects the purpose and intention of this Agreement. Allocations pursuant to this Section 5.04 are solely for purposes of federal, state and local taxes and shall not affect, or in any way be taken into account in computing, any Member’s Capital Account or share of Net Profit, Net Losses or other items or distributions pursuant to any provision of this Agreement.

5.05 Allocations of Net Profits and Losses and Distributions in Respect of a Transferred Interest. If any Membership Interest is transferred, or is increased or decreased by reason of the admission of a new Member or otherwise, during any Fiscal Year of the Company, Net Profit or Net Loss for such Fiscal Year shall be assigned pro rata to each day in the particular period of such Fiscal Year to which such item is attributable (i.e., the day on or during which it is accrued or otherwise incurred) and the amount of each such item so assigned to any such day shall be allocated to the Member based upon its respective Membership Interest at the close of such day.

5.06 Distributions by the Company.

(a) Subject to applicable law and any limitations contained elsewhere in this Agreement, the Management Committee (i) shall, at the time of any payment by the Members in respect of their income tax obligations attributable to their respective Membership Interests, distribute to each Member, based upon its then respective Percentage Interests, such Member’s Tax Allowance Amount and (ii) may, in its sole discretion, elect from time to time to otherwise distribute Distributable Cash to the Members; provided that:

(1) with respect to each fiscal quarter ending prior to 12:01 A.M. on January 1, 2010 (the “Covered Period”), to the extent that such distribution would not leave the Company and its subsidiaries (other than First Advantage) with an aggregate cash balance of less than $30,000,000, the Management Committee shall distribute for each such quarter an amount equal to not less than the sum of: (I) 67% of the difference of (A) Net Profits after subtracting the Company’s equity in the earnings of First Advantage and after subtracting the net profits of CoreLogic (to the extent otherwise included in Net Profits), plus any dividends paid by First Advantage and CoreLogic to the Company for the applicable year minus (B) any distribution made pursuant to subsection (a), clause (i) of this Section 5.06 for such year and (II) 67% of the net profits of CoreLogic (to the extent otherwise included in Net Profits);

(2) during the Covered Period, promptly following any distributions made pursuant to clause (1) of this proviso, the Management Committee shall distribute any cash held by the Company in excess of $100,000,000; provided that for purposes of calculating cash held by the Company, cash held by the Company and its subsidiaries (other than First Advantage) shall be deemed cash held by the Company; and

(3) for each fiscal quarter of the Company commencing with the fiscal quarter ending March 31, 2010 and ending with the fiscal quarter ending December 31, 2010, the Management Committee shall distribute to FAREISI, $16,844,800, and to Experian,

20

$4,211,200; provided, however, that Experian’s right to receive future Distributable Cash pursuant to this clause (3) during the fiscal year of the Company ending on December 31, 2010 shall terminate as to distributions for future fiscal quarters on a Special Put Closing Date, the Accelerated Put Closing Date or the Accelerated Call Closing Date, as the case may be; provided, further, however, that if a Special Put Closing Date, the Accelerated Put Closing Date or the Accelerated Call Closing Date, as the case may be, occurs on a day that is not the last day of a fiscal quarter of the Company, Experian shall be entitled to receive the product of $4,211,200 and a fraction, the numerator of which is the number of days elapsed from and including the first day of the fiscal quarter during which the Special Put Closing Date, the Accelerated Put Closing Date or the Accelerated Call Closing Date, as the case may be, occurs to but excluding such Special Put Closing Date, the Accelerated Put Closing Date or the Accelerated Call Closing Date, as the case may be, and the denominator of which is the number of days during such fiscal quarter.

If an Entity ceases to be a subsidiary of the Company or ceases to be an Entity in which the Company maintains an equity interest, in each case other than on the last day of a period for which distributions are to be made by the Company, the income and loss of such Entity or the Company’s equity in the income and loss of such Entity shall be included in the determination of “Net Profits” for such period through the last date such Entity was a subsidiary of the Company or the last date on which the Company maintained an equity interest in such Entity.

If neither the Put Option nor the Call Option has been exercised by December 31, 2010, the parties (which for this purpose will also include First American or the Spin-off Successor, as the case may be) will negotiate in good faith to determine the formula or method by which distributions over and above tax distributions (contemplated by Section 5.06(a)(i) or otherwise) will be made by the Company; it being understood and agreed that it is the intent of the parties that the Company makes distributions of its cash flow in excess of its working capital needs and other cash needs, including, without limitation, adequate reserves for reasonable future contingencies and acquisitions, based upon an agreed formula or method of determination.

(b) All distributions, other than pursuant to Section 5.06(a)(3) and/or Section 8.06, shall be made to the Members in proportion to their Percentage Interests. Except as otherwise provided pursuant to Section 5.06(a)(3), all such distributions shall be made only to the Persons who, according to the books and records of the Company, are the holders of record of the Membership Interests in respect of which such distributions are made on the actual date of distribution.

5.07 Form of Distribution. A Member, regardless of the nature of the Member’s Capital Contribution, has no right to demand and receive any distribution from the Company in any form other than money. Except as provided in Article VIII, no Member may be compelled to accept from the Company a distribution of any asset in kind in lieu of a proportionate distribution of money being made to other Members.

5.08 Restriction on Distributions.

(a) Except for distributions to the Members in accordance with Section 5.06(a)(i), no distribution shall be made if, after giving effect to the distribution:

21

(i) The Company would not be able to pay its debts as they become due in the usual course of business; or

(ii) The Company’s total assets would be less than the sum of its total liabilities plus, unless this Agreement provides otherwise, the amount that would be needed, if the Company were to be dissolved at the time of the distribution, to satisfy the preferential rights of other Members, if any, upon dissolution that are superior to the rights of the Member receiving the distribution.

(b) The Management Committee may base a determination that a distribution is not prohibited on any of the following:

(i) Financial statements prepared in accordance with GAAP;

(ii) A fair valuation; or

(iii) Any other method that is reasonable in the circumstances.

5.09 Return of Distributions. Members who receive distributions made in violation of the Act or this Agreement shall return such distributions to the Company. Except for those distributions made in violation of the Act or this Agreement, no Member shall be obligated to return any distribution to the Company or pay the amount of any distribution for the account of the Company or to any creditor of the Company. The amount of any distribution returned to the Company by a Member or paid by a Member for the account of the Company or to a creditor of the Company shall be added to the account or accounts from which it was subtracted when it was distributed to the Member.

5.10 Withholding Taxes.

(a) Authority to Withhold; Treatment of Withheld Tax. Notwithstanding any other provision of this Agreement, each Member hereby authorizes the Company to withhold and to pay over, or otherwise pay, any withholding or other taxes payable by the Company or any of its Affiliates (pursuant to the Code or any provision of United States federal, state or local or non-U.S. tax law) with respect to such Member or as a result of such Member’s participation in the Company. If and to the extent that the Company shall be required to withhold or pay any such withholding or other taxes, such Member shall be deemed for all purposes of this Agreement to have received a payment from the Company as of the time such withholding or other tax is required to be paid, which payment shall be deemed to be a distribution of Distributable Cash pursuant to the relevant clause of Section 5.1 with respect to such Member’s Membership Interest to the extent that such Member (or any successor to such Member’s Membership Interest) would have received a distribution but for such withholding. To the extent that the aggregate of such payments to a Member for any period exceeds the distributions that such Member would have received for such period but for such withholding, the Management Committee shall notify such Member as to the amount of such excess and such Member shall make a prompt payment to the Company of such amount by wire transfer. Any withholdings by the Company referred to in this Section 5.10(a) shall be made at the maximum applicable statutory rate under the applicable tax law unless the Management Committee shall have received an

22

opinion of counsel or other evidence, satisfactory to the Management Committee, to the effect that a lower rate is applicable, or that no withholding is applicable.

(b) Withholding from Distributions of Property. If the Company makes a distribution in kind and such distribution is subject to withholding or other taxes payable by the Company on behalf of any Member, such Member shall make a prompt payment to the Company of the amount required to be withheld.

(c) Withholding from Distributions to the Company. In the event that the Company receives a distribution from or in respect of which tax has been withheld, the Company shall be deemed to have received cash in an amount equal to the amount of such withheld tax, and each Member shall be deemed to have received as a distribution of Distributable Cash pursuant to the relevant clause of Section 5.06 the portion of such amount that is attributable to such Member’s Membership Interest as equitably determined by the Management Committee.

(d) Indemnification. The Company shall, to the fullest extent permitted by applicable law, indemnify and hold harmless each Person who is or who is deemed to be the responsible withholding agent for United States federal, state or local or non-U.S. income tax purposes against all claims, liabilities and expenses of whatever nature (other than any claims, liabilities and expenses in the nature of penalties and accrued interest thereon that result from such Person’s gross negligence, willful misconduct or bad faith) relating to such Person’s obligation to withhold and to pay over, or otherwise pay, any withholding or other taxes payable by the Company or as a result of such Member’s participation in the Company.

ARTICLE VI

MEMBERSHIP INTEREST TRANSFER RESTRICTIONS

6.01 Transfer Restrictions. EXCEPT FOR TRANSFERS REQUIRED IN CONNECTION WITH THE EXERCISE AND CLOSING OF THE CALL OPTION AND/OR THE PUT OPTION AND FOR TRANSFERS PERMITTED PURSUANT TO THIS ARTICLE VI, EACH MEMBER AGREES THAT IT WILL NOT IN ANY WAY, DIRECTLY OR INDIRECTLY, TRANSFER ITS MEMBERSHIP INTEREST (WHETHER NOW OWNED OR HEREAFTER ACQUIRED), OR ANY RIGHT OR INTEREST THEREIN, WHETHER VOLUNTARILY OR BY OPERATION OF LAW.

6.02 Further Restrictions on Transfer of Interests. In addition to other restrictions found in this Agreement, no Member shall Transfer all or any part of its Membership Interest: (i) without compliance with all federal and state securities laws, and (ii) if the Membership Interest to be transferred, when added to the total of all other Membership Interests transferred in the preceding twelve (12) consecutive months prior thereto, would cause the tax termination of the Company under Code Section 708(b)(1)(B).

6.03 Void Transfer. Any purported Transfer of any Member’s Membership Interest in violation of Sections 6.01 and 6.02 shall be void and the Company shall not give effect to any such purported transfer or recognize any such purported transferee. In the event of any such

23

purported Transfer, the Company shall continue to recognize as a Member only those persons whose names appear in the records of the Company.

6.04 Permitted Transfers.

(a) Notwithstanding anything to the contrary contained in this Article VI, any Member may effect a Transfer upon the terms and conditions of this Section 6.04 set forth below (each a “Permitted Transfer” and each transferee thereof, a “Permitted Transferee”).

(b) The Membership Interest of any Member may be Transferred to any other Member, subject to compliance with Section 6.02, and without the prior written consent of the other Members or the Management Committee. The Membership Interest held by FAREISI may be Transferred to the Spin-off Successor or an Affiliate thereof; provided that any such transferee agrees in writing to be bound by the terms and conditions of this Agreement and the JV Agreement which were applicable to FAREISI prior to such transfer.

(c) If any Member desires to sell all or any part of its Membership Interest (other than pursuant to Section 6.04(b)) and (i) is not otherwise prohibited from doing so under this Section 6.04 and (ii) identifies a proposed transferee that is willing to purchase all or part of such Membership Interest for cash (a “Proposed Transferee”), such Member shall first offer to sell the Offered Interest to the other Members (the “Offer”) by giving the other Members written notice thereof (an “Offer Notice”) specifying (A) the identity of the Proposed Transferee, (B) the Membership Interest offered (the “Offered Interest”), (C) the price at which the Proposed Transferee is willing to purchase the Offered Interest (the “Offering Price”) and (D) any other terms of the Offer (the “Offer Terms”). Following its receipt of an Offer Notice, each Member shall have a ten (10) day period during which it may elect to accept the Offer and acquire all or a portion of the Offered Interest at the Offering Price and upon the Offer Terms. The failure of any Member to deliver a written election notice within the applicable period shall constitute an election on the part of that Member not to purchase any of the Offered Interest. Each Member so electing to acquire shall be entitled to purchase a portion of the Offered Interest in the same proportion that the Percentage Interest of such Member bears to the aggregate of the Percentage Interests of all of the Members electing to so purchase the Offered Interest. In the event any Member elects to purchase none or less than all of its pro rata share of the Offered Interest, then each other Member can elect to purchase any such remaining portion of the Offered Interest in the same proportion that the Percentage Interest of such Member bears to the aggregate of the Percentage Interests of all of the Members electing to so purchase the remaining portion of the Offered Interest.

(d) In the event the other Members elect not to purchase or obtain all of the Offered Interest (an “Offer Rejection”), the transferring Member shall be free, subject to compliance with the tag-along provisions of Section 6.04(e) below, if applicable, to sell the Offered Interest to the Permitted Transferee at the Offering Price and upon the Offer Terms. If such sale is not consummated at the Offering Price and upon the Offer Terms within sixty (60) days from the date of the Offer Rejection, then the provisions of Section 6.04(c) shall once again apply.

(e) In the event that FAREISI proposes to effect a Permitted Transfer of all or any part of its Membership Interest pursuant to Section 6.04(d) above, FAREISI shall promptly give

24

written notice (such notice, a “Transfer Notice”) thereof to Experian setting forth the name of, and the portion of its Membership Interest to be purchased by, the Permitted Transferee, the purchase price of the Membership Interest to be sold, any other significant terms of such sale and the date such proposed sale will be consummated. Experian shall have the right, exercisable upon irrevocable written notice to FAREISI within ten (10) days after receipt of a Transfer Notice, to participate in such sale on the same terms and conditions as set forth in the Transfer Notice and to sell all or any portion of its Membership Interest. Experian shall effect its participation in the sale by delivering on the date scheduled for such sale to FAREISI for delivery to the Permitted Transferee one or more certificates, if any, representing the Membership Interest which Experian desires to sell in accordance with this Section 6.04(e) and/or any other duly executed instruments of transfer necessary to effect the transfer of its Membership Interest. Such certificate or certificates and/or instruments of transfer delivered by Experian to FAREISI shall be delivered on such date to such Permitted Transferee in consummation of the sale of Experian’s Membership Interest pursuant to the terms and conditions specified in the Transfer Notice, and FAREISI shall concurrently therewith remit to Experian that portion of the sale proceeds or other consideration to which Experian is entitled by reason of its participation in such sale. FAREISI’s sale of all or any portion of its Membership Interest shall be effected on the terms and conditions set forth in the applicable Transfer Notice. In no event shall FAREISI receive special consideration in such sale. The exercise or non-exercise of the rights of Experian hereunder to participate in one or more sales of a Membership Interest made by FAREISI shall not adversely affect its right to participate in subsequent sales of any Membership Interest subject to this Section 6.04.

6.05 Third-Party Offers. Notwithstanding anything to the contrary contained in this Article VI, in the event that an offer is made by an unrelated third-party to purchase the entire Company (a “Third-Party Offer”) and such Third-Party Offer is acceptable to FAREISI, then FAREISI shall first offer to sell 100% of its Membership Interests to Experian by giving Experian written notice thereof specifying the terms of the Third-Party Offer upon which FAREISI is willing to sell its Membership Interest (the “Third-Party Terms”). Following its receipt of such notice pursuant to this Section 6.05, Experian shall have a thirty (30) day period during which it may elect to acquire all of the Membership Interest of FAREISI upon the Third-Party Terms. In the event that Experian rejects the offer of FAREISI hereunder or fails to deliver a written notice accepting such offer within the applicable period, (a) FAREISI shall be free to sell its Membership Interest to such third-party purchaser upon the Third-Party Terms and (b) Experian shall be obligated to sell its Membership Interest to such third-party purchaser upon the Third-Party Terms and otherwise upon terms no less favorable than those given by the third-party purchaser to FAREISI (pro rata based upon the relative size of the Membership Interest of Experian vis-à-vis the Membership Interest of FAREISI) unless the closing of such Third Party Offer occurs on or prior to December 31, 2010, or if notice of the Third-Party Offer is delivered after exercise of the Put Option or the Call Option, in which case Experian shall be obligated to sell its Membership Interest to such third-party purchaser, at Experian’s written election, either upon (x) the Third-Party Terms and otherwise upon terms no less favorable than those given by the third-party purchaser to FAREISI (pro rata based upon the relative size of the Membership Interest of Experian vis-à-vis the Membership Interest of FAREISI) or (y) for the then applicable Put Price (pursuant to the JV Agreement, and including any interest, fees, expenses or other amounts due thereunder) plus all accrued and unpaid distributions (together with all accrued and

25

unpaid management services fee payable to Experian pursuant to Article II of the JV Agreement) payable in cash, as if such sale were the closing of the Put Option.

6.06 Special Sale Right. Notwithstanding anything to the contrary contained in this Article VI, if the Put Option, the Special Put Option or the Call Option is exercised, and Experian does not receive the full amount of the Put Price or the Call Price within nine months of the Put Closing Date, the Special Put Closing Date, the Accelerated Put Closing Date, the Call Closing Date or the Accelerated Call Closing Date, as applicable, Experian shall have the right at the end of such nine month period, exercisable by delivery of written notice to the Company and the other Members to conduct a process to sell the Company upon commercially reasonable terms (which may include a break up fee payable by FAREISI to the Person or Persons making the Third-Party Offer in an amount up to three percent (3%) of the aggregate consideration described in the Third-Party Offer (a “Break-up Fee”)), and the other Members shall cooperate and cause their officers, employees and agents, and the officers, employees and agents of the Company to cooperate in such sale process. In the event that such sale process results in a Third Party Offer, and such Third-Party Offer is acceptable to Experian, then Experian shall give FAREISI written notice thereof specifying the Third Party Terms (the “Experian Special Sale Notice”). At any time not less than fifteen (15) days after the delivery of such notice, (a) Experian shall be free to sell its Membership Interest to such third-party purchaser upon the Third-Party Terms and (b) FAREISI shall be obligated to sell its Membership Interest to such third-party purchaser upon the Third-Party Terms; provided, that notwithstanding anything herein to the contrary, the aggregate proceeds of such transaction shall be paid (i) first, to Experian until it has received an aggregate amount an amount equal to the Put Price or the Call Price (plus all interest, fees and expenses due in connection therewith pursuant to the JV Agreement) plus the reasonable expenses incurred by Experian in the sale process and in the negotiation, execution and consummation of such transaction (“Experian Transaction Expenses”) and (ii) second, to FAREISI. Experian’s rights pursuant to this Section 6.06 shall terminate at such time as it has received the full amount of the Put Price or the Call Price, together with all interest, fees, costs, expenses owed to it in connection therewith pursuant to the JV Agreement and all Experian Transaction Expenses and First American or the Spin-off Successor, as the case may be, shall have paid, or caused the Company or one of their Affiliates to have paid, to the Person or Persons making the Third-Party Offer referenced in the Experian Special Sale Notice any Break-up Fee included in such Third Party Offer.

ARTICLE VII

BUSINESS OPPORTUNITIES

7.01. Business Opportunities.

(a) If the Company becomes aware of any Company Development Opportunity prior to the exercise of the Put Option or the Call Option, the Management Committee will give due consideration to the desirability of pursuing such Company Development Opportunity. Except as provided in Section 7.01(c), if the Company does not promptly pursue such Company Development Opportunity, each of the Members and their respective Affiliates shall be free to pursue such Company Development Opportunity and the Company shall not have any right, claim or interest in or to any revenues or assets resulting therefrom.

26

(b) Should any Member or any of its Affiliates discover, develop or be offered a Company Development Opportunity prior to the exercise of the Put Option or the Call Option, such Person will first offer such Company Development Opportunity to the Company. Except as provided in Section 7.01(c), if the Management Committee does not promptly pursue such Company Development Opportunity, then the Person discovering, developing or being offered such Company Development Opportunity and its Affiliates shall be free to pursue such Company Development Opportunity and neither the Company nor any other Member shall have any right, claim or interest in or to any revenues or assets resulting therefrom.

(c) Notwithstanding anything in Sections 7.01(a) and 7.01(b) to the contrary, prior to the exercise of the Put Option or the Call Option, neither FAREISI nor any of its Affiliates shall be free to pursue any Company Development Opportunity offered to but not promptly pursued by the Company if (i) such Company Development Opportunity was offered to the Company by FAREISI or any of its Affiliates and (ii) the Experian Managers voted to pursue such Company Development Opportunity. Notwithstanding anything in Sections 7.01(a) and 7.01(b) to the contrary, prior to the exercise of the Put Option or the Call Option, neither Experian nor any of its Affiliates shall be free to pursue any Company Development Opportunity offered to but not promptly pursued by the Company if (i) such Company Development Opportunity was offered to the Company by Experian or any of its Affiliates and (ii) the FAREISI Managers voted to pursue such Company Development Opportunity.

(d) The provisions of this Section 7.01 shall terminate and be of no further force or effect after the exercise of the Put Option or the Call Option.

ARTICLE VIII

CONSEQUENCES OF DISSOLUTION EVENTS;

TERMINATION OF MEMBERSHIP INTEREST

8.01 Dissolution Event. Upon the occurrence of a Dissolution Event, the Company shall dissolve unless the remaining Members (“Remaining Members”) holding a majority of the Percentage Interests which all Remaining Members hold, consent within ninety (90) days of the Dissolution Event to the continuation of the business of the Company. If the requisite majority of the Remaining Members consents to the continuation of the business of the Company, the Company and/or the Remaining Members shall have the right to purchase, and if such right is exercised, the Member whose actions or conduct resulted in the Dissolution Event (“Former Member”) or such Former Member’s legal representative shall sell, the Former Member’s Membership Interest (“Former Member’s Interest”) as provided in this Article VIII.

8.02 Withdrawal. Notwithstanding Section 8.01, upon the termination of a Member’s Membership Interest in accordance with Section 3.03, such Member shall be treated as a Former Member, and, unless the Company is to dissolve, the Company and/or the Remaining Members shall have the right to purchase, and if such right is exercised, the Former Member shall sell, the Former Member’s Interest as provided in this Article VIII.

27

8.03 Purchase Price. The purchase price for the Former Member’s Membership Interest shall be calculated using the formula for determining the Put Price and shall be paid in cash.

8.04 Notice of Intent to Purchase. Within thirty (30) days after the Management Committee has notified the Remaining Members as to the purchase price of the Former Member’s Interest determined in accordance with Section 8.03, each Remaining Member shall notify the Management Committee in writing of its desire to purchase all or a portion of the Former Member’s Interest. The failure of any Remaining Member to submit a notice within the applicable period shall constitute an election on the part of such Member not to purchase any of the Former Member’s Interest. Each Remaining Member so electing to purchase shall be entitled to purchase a portion of the Former Member’s Interest in the same proportion that the Percentage Interest of the Remaining Member bears to the aggregate of the Percentage Interests of all of the Remaining Members electing to purchase the Former Member’s Interest.

8.05 Purchase Pro Rata. If any Remaining Member elects to purchase none or less than all of its pro rata share of the Former Member’s Interest, then each other Remaining Member may elect to purchase any such remaining portion of the Former Member’s Interest in the same proportion that the Percentage Interest of such Remaining Member bears to the aggregate of the Percentage Interests of all of the Remaining Members electing to so purchase the remaining portion of the Former Member’s Interest. If the Remaining Members fail to purchase the entire Membership Interest of the Former Member, the Company shall purchase any remaining share of the Former Member’s Interest.

8.06 Winding Up the Company. If, upon the occurrence of a Dissolution Event, the requisite majority of the Remaining Members fails to consent to the continuation of the business of the Company, the Management Committee shall promptly notify the Members of such dissolution and shall wind up the affairs of the Company and liquidate the Company assets. Such winding up and liquidation shall be accomplished as soon as practicable giving due regard to the prudent liquidation of the Company’s assets in such a manner as to preserve the value of the Company’s assets to the extent that the Management Committee deems practicable. Distributions made with respect to the liquidation of the Company shall be made to the Members no later than ninety days following completion of the liquidation. The proceeds of such liquidation shall be paid in the following order:

(a) First, in payment of the debts and liabilities of the Company and the expenses of liquidation;

(b) Then, to the establishment of such reserves as may be deemed reasonably necessary by the Management Committee for any contingent or unforeseen liabilities or obligations of the Company; and

(c) Then, after making all allocations required by Section 5.01, to Members, in proportion to the positive balance in the Members’ respective Capital Accounts after satisfaction of each Member’s obligation to the Company.

28

8.07 Final Statement. Each of the Members shall be furnished with a statement which shall set forth the assets and liabilities of the Company (as of the date of complete liquidation) and an accounting of the manner in which the assets of the Company were distributed.

ARTICLE IX

BOOKS AND RECORDS; TAX RETURNS; ACCESS BY MEMBERS

9.01 Company Books and Records. Proper and complete records and books of account of the Company business shall be kept by the Company under the supervision of the Management Committee and shall be audited by certified public accountants selected by the Management Committee. The financial books of the Company shall be maintained in accordance with GAAP.

9.02 Tax Returns.

(a) The Management Committee shall prepare or cause to be prepared all income and other tax returns of the Company and shall cause the same to be filed in a timely manner (including extensions). Not later than 90 days after the end of each Fiscal Year, the Management Committee shall deliver or cause to be delivered to each Member a copy of the Company tax returns and Schedule K-1 for the Company with respect to such Fiscal Year, together with such information with respect to the Company as shall be necessary for the preparation by such Member of its U.S. federal and state income or other tax and information returns.

(b) The Management Committee shall take any action on behalf of the Company required to cause the Company to be in compliance with any applicable governmental regulations. Tax allocations shall be made in accordance with Article V hereof. Each Member shall file its separate federal income tax returns in a manner consistent with the provisions of this Agreement and in accordance with applicable federal income tax law. The Members shall provide each other with copies of all correspondence or summaries of other communications with the Internal Revenue Service or U.S. Treasury regarding any aspect of items of Company income, gain, loss or deduction and no Member shall enter into settlement negotiations with the Internal Revenue Service or U.S. Treasury with respect to the federal income tax treatment of any Company item of income, gain, loss or deduction without first giving reasonable written advance notice of such intended action to the other Members. The Management Committee shall cooperate with the other Members and shall promptly provide the other Members with copies of notices or other materials from, and inform the other Members of discussions engaged in with, any federal, state, local or international taxing authority and shall provide the other Members with notices of all scheduled administrative proceedings, technical advice conferences and appellate hearings, as soon as possible after receiving notice of the scheduling of such proceedings. The Management Committee shall not take any action of any nature whatsoever including, without limitation, agreeing to extend the period of limitations for assessments, filing a petition or complaint in any court, filing a request for an administrative adjustment of Company items after any return has been filed, or entering into any settlement agreement with the Internal Revenue Service, the U.S. Treasury or any other federal, state, local or international taxing authority with respect to Company items of income, gain, loss or deduction, in any such case without first consulting each Member. The Management Committee may request extensions to file any tax return or statement without consulting with, but shall so inform, the

29

Members. The provisions of this Agreement regarding the Company’s tax returns shall survive the termination of the Company and the transfer of any Member’s Membership Interest and shall remain in effect for the period of time necessary to resolve any and all matters regarding the federal, state, local and international income taxation of the Company and items of Company income, gain, loss and deduction effecting such Members.

9.03 Inspection, Audit and Copies of Records. Each Member shall have the right to inspect, make a separate audit and make copies of the books and records of the Company. The Member exercising such right shall bear all expenses incurred in the exercise of these rights.

9.04 Access. Each Member shall have access at reasonable times and upon reasonable notice, without undue disruption of the business and operations of the Company, to such properties, employees, agents, representatives and information of the Company as it deems reasonably necessary in connection with the ownership of its Membership Interest.

ARTICLE X

MISCELLANEOUS

10.01 Specific Performance. Due to the fact that the parties hereto will be irreparably damaged in the event that this Agreement is not specifically enforced, in the event of a breach or threatened breach of the terms, covenants and/or conditions of this Agreement by any of the parties hereto, the other parties shall, in addition to all other remedies, be entitled to a temporary or permanent injunction, without showing any actual damage, and/or a decree for specific performance, in accordance with the provisions hereof.

10.02 Amendments and Modifications.

(a) Prior to the exercise of the Call Option or the Put Option, the provisions of this Agreement may be waived, altered, amended, modified, or repealed, in whole or in part, only by the written consent of Experian and FAREISI. From and after the exercise of the Call Option or the Put Option, the provisions of this Agreement may be waived, altered, amended, modified, or repealed, in whole or in part, by the written consent of FAREISI acting alone and in its sole discretion; provided, however, until Experian has received the Call Price or the Put Price, as the case may be, no waiver, alteration, amendment, modification or repeal shall (i) affect Experian’s right to receive distributions from the Company pursuant to Section 5.06 (including, without limitation, the right to receive $4,211,200 for each quarterly period ending with the fiscal quarter ended December 31, 2010 in accordance Section 5.06(a)(3)) for periods prior to the closing of the Put Option or Call Option; (ii) increase the liabilities or expand the obligations (including, without limitation, the allocations for tax purposes described in Sections 5.01, 5.02, 5.03 and/or 5.04 but excluding tax liabilities to the extent compensated for by tax distributions) of Experian on a net basis; (iii) create new liabilities or obligations (excluding tax liabilities to the extent compensated for by tax distributions) for Experian on a net basis or (iv) amend or otherwise affect Experian’s rights pursuant this Section 10.02 or pursuant to any of Sections 6.06, 9.01 or 9.02. Any oral representations or modifications concerning this instrument shall be of no force or effect unless contained in a subsequent written modification signed by the applicable Party or Parties.

30

(b) Notwithstanding anything herein to the contrary, if the Put Option or the Call Option is exercised, and Experian does not receive the full amount of the Put Price or the Call Price within five (5) Business Days of the Put Closing Date, the Special Put Closing Date, the Accelerated Put Closing Date, Call Closing Date or Accelerated Call Closing Date, as applicable, then Experian may, in its sole discretion and without the consent of any other Member, the Board of Managers or any other person, entity or governing body, adopt in writing amendments which it reasonably determines are necessary or appropriate to cause the management of the Company to be conducted in the manner provided pursuant to Article IV of the Existing Operating Agreement. Upon adoption of any such amendments, Experian shall provide prompt written notice to the Company and FAREISI. Any such amendments adopted by Experian shall remain effective until Experian has received the full amount of the Put Price or the Call Price (and all interest, fees, expenses and Experian Transaction Expenses payable in connection therewith pursuant to the terms of the JV Agreement or hereunder).

10.03 Notices. All notices, requests, demands, waivers and other communications required or permitted to be given under this Agreement shall be in writing and shall be addressed as follows:

If to the Company:

c/o The First American Corporation

1 First American Way

Santa Ana, California 92707

Telephone: (714) 250-3000

Facsimile: (714) 250-6923

Attention: Chief Executive Officer

Attention: General Counsel

If to FAREISI or First American:

The First American Corporation

1 First American Way

Santa Ana, California 92707

Telephone: (714) 250-3000

Facsimile: (714) 250-6923

Attention: Chief Executive Officer

Attention: General Counsel

with a copy to:

White & Case LLP

633 West Fifth Street, 19th Floor

Los Angeles, California 90071

Telephone: (213) 620-7700

Facsimile: (213) 452-2329

Attention: Neil W. Rust

31

If to Experian:

Experian Information Solutions, Inc.

475 Anton Blvd.

Costa Mesa, California 92626-7036

Telephone: (714) 830-5331

Facsimile: (714) 830-2513

Attention: General Counsel

with a copy to:

Sonnenschein Nath & Rosenthal LLP

233 South Wacker Dr.

Suite 7800

Chicago, Illinois 60606

Telephone: (312) 876-8000

Facsimile: (312) 876-7934

Attention: Michael D. Rosenthal

or to such other Person or address as any party shall specify by notice in writing to each of the other parties hereto. Except for a notice of a change of address, which shall be effective only upon receipt thereof, all such notices, requests, demands, waivers and communications properly addressed shall be effective: (i) if sent by U.S. mail, three Business Days after deposit in the U.S. mail, postage prepaid; (ii) if sent by FedEx or other overnight delivery service, two Business Days after delivery to such service; (iii) if sent by personal courier, upon receipt; and (iv) if sent by facsimile, upon receipt.

10.04 Attorneys’ Fees. Should any litigation be commenced between the parties hereto concerning any provision of this Agreement or the rights and duties of any person in relation thereto, the party or parties prevailing in such litigation shall be entitled, in addition to such other relief as may be granted, to a reasonable sum as and for attorneys’ fees in such litigation.

10.05 Further Assurances. Each of the parties hereto does hereby covenant and agree on behalf of itself and its successors and assigns, without further consideration, to execute and deliver such other instruments, documents and statements, and to take such other action, as may be required by law or as are necessary effectively to carry out the purposes of this Agreement.

10.06 Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, and all of which together shall be deemed to be one and the same instrument.

10.07 Governing Law. This Agreement, including its existence, validity, construction and operating effect, and the rights of each of the parties hereto, shall be governed by and construed in accordance with the internal laws of the State of California.

10.08 Successors. Subject to the restrictions against Transfer as herein contained, the provisions of this Agreement shall inure to the benefit of and shall be binding upon the respective successors and permitted assigns of each of the parties hereto. Except as set forth in

32

Section 10.12 below, nothing in this Agreement, express or implied, is intended to confer on any Person other than the parties hereto or their respective successors and permitted assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

10.09 Severability. If any term, provision, covenant, or condition of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the rest of this Agreement shall remain in full force and effect and shall in no way be affected, impaired, or invalidated.

10.10 Entire Agreement. This Agreement and any agreements referred to herein (including, without limitation, the JV Agreement), constitutes the entire agreement of the parties pertaining to the subject matter hereof, and fully supersedes any and all prior agreements or understandings between the parties pertaining to the subject matter hereof.

10.11 Confidentiality. Subject to the requirements of applicable law, each party shall maintain in confidence all information received from the Company and, except as may otherwise be expressly permitted by a separate written agreement, shall use such information only for the benefit of the Company, and shall not disclose any such information to any third party or make any unauthorized use thereof. Each party shall treat all such information with the same degree of care against disclosure or unauthorized use which it affords to its own confidential information. The obligation of confidentiality and non-use shall not apply to any information which (a) is or becomes generally available to the public through no fault of the receiving party, (b) is independently developed by the receiving party or (c) is received in good faith from a third party who is lawfully in possession of such information and has the lawful right to disclose or use it.

[Remainder of page intentionally left blank.]

33

IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the date first written above.

FIRST AMERICAN REAL ESTATE INFORMATION SERVICES, INC.
By:	/s/ Kenneth D. DeGiorgio
Name:	Kenneth D. DeGiorgio
Title:	Vice President
EXPERIAN INFORMATION SOLUTIONS, INC.
By:	/s/ Scott Leslie
Name:	Scott Leslie
Title:	Secretary

-Signature Page-

Amended and Restated Operating Agreement

EX-10.(RRR)

Exhibit (10)(rrr)

TERMINATION AND RELEASE AGREEMENT

This TERMINATION AND RELEASE AGREEMENT (this “Termination Agreement”) is entered into as of December 31, 2009 among The First American Corporation, a California corporation (“First American”), First American Real Estate Information Services, Inc., a California corporation (“FAREISI”), First American Real Estate Solutions LLC, a California limited liability company (“FARES”), First American Real Estate Solutions II LLC, a California limited liability company (“FARES II”), and Experian Information Solutions, Inc., an Ohio corporation (“Experian”). First American, FAREISI, FARES, FARES II and Experian shall be referred to herein individually as a “Party” and collectively as the “Parties”. Capitalized terms used but not otherwise defined herein shall have the meanings given such terms in the Joint Venture Restructuring Agreement, of even date herewith, among First American, First American Title Insurance Company, FAREISI and Experian.

W I T N E S S E T H:

WHEREAS, First American, FAREISI and Experian have previously entered into the Interim Operating Agreement, dated as of November 30, 1997, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “Interim Operating Agreement”);

WHEREAS, First American, FAREISI and FARES have previously entered into the FAREISI Transition Agreement, dated as of November 30, 1997, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “FAREISI Transition Agreement”);

WHEREAS, Experian and FARES have previously entered into the Experian Transition Agreement, dated as of November 30, 1997, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “Experian Transition Agreement”);

WHEREAS, Experian and FARES have previously entered into the transition mechanics side letter dated November 30, 1997, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “Transition Side Letter”);

WHEREAS, Experian and FARES have previously entered into the letter agreement dated November 30, 1997, relating to the license of RES data, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “RES Data License”);

WHEREAS, Experian and FARES have previously entered into the Trademark License Agreement, dated as of November 30, 1997, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “Trademark License Agreement”);

WHEREAS, First American, FAREISI, Experian and FARES II have previously entered into the Contribution and Joint Venture Agreement, dated as of June 2003, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “FARES II JV Agreement”);

1

WHEREAS, First American, FARES and Experian have previously entered into the Amended and Restated Omnibus Agreement dated as of June 22, 2005, as further amended by that certain Fifth Agreement of Amendment dated as of November 10, 2009, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “Omnibus Agreement”);

WHEREAS, First American and Experian have previously entered into the Consent to Transaction, dated as of October 2, 2009, together with all amendments, modifications and supplements thereto, if any, through the date hereof (the “Consent”); and

WHEREAS, the Parties hereto desire to terminate each of the Interim Operating Agreement, FAREISI Transition Agreement, Experian Transition Agreement, Transition Side Letter, RES Data License, Trademark License Agreement, FARES II JV Agreement, the Omnibus Agreement and the Consent (each, a “Prior Agreement” and collectively, the “Prior Agreements”), and the Parties have agreed to terminate such agreements on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the premises and mutual promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties agree as follows:

1. Termination of Prior Agreements. Each Party hereby agrees that as of the date hereof each Prior Agreement to which it is a Party is hereby terminated and of no further force and effect.

2. Waiver and Release. As of the date hereof, each of the Parties hereto hereby waives all rights it may have against any other Party in respect of the Prior Agreements to which it is a party and transactions contemplated thereby. The Parties hereto hereby forever, absolutely, unconditionally and completely release and discharge each other, and each of their respective Affiliates, and their respective officers and directors, and each of their respective successors and assigns, from and against any and all actual, threatened or potential claims, suits, proceedings, actions, causes of action, demands, liabilities, losses, obligations, orders, requirements or restrictions, liens, penalties, fines, charges, debts, compensatory or punitive damages, injunctive relief, equitable relief, or any other relief or claim, and costs and expenses of every kind and nature whatsoever, whether now known or unknown, foreseeable or unforeseeable, whether matured or unmatured, whether contingent or non-contingent, whether under any federal, state or local law (both statutory and non-statutory) (each a “Claim” and, collectively, “Claims”) that any Party at any time heretofore have or may have against any other Party regarding the Prior Agreements, for performance thereunder or the transactions contemplated thereby, or that could have been asserted under the Prior Agreements.

It is the intention of the Parties and their counsel that this Agreement be effective as a full and final accord, satisfaction and release as to the matters released in the prior paragraphs. In furtherance of this intention, each Party represents, and warrants that it has read and is familiar with California Civil Code § 1542, which provides as follows:

2

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.”

Each Party, with the advice of counsel, knowingly and voluntarily waives any protection to which it may be entitled under Section 1542 and further waives any protection that may exist under any comparable or similar statutes or principles of law under any and all states of the United States or of the United States, and covenants not to assert any claims in violation of this waiver.

3. Miscellaneous

(a) Each Party agrees to perform any further acts and execute and deliver any further documents which may be reasonably requested by any other Party to carry out the intent of this Termination Agreement.

(b) This Termination Agreement may not be transferred or assigned by any Party without the prior written consent of the other Parties. This Termination Agreement shall inure to the benefit of the successors and assigns of each Party.

(c) This Termination Agreement constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes any prior understandings, agreements, or representations by or among the Parties, written or oral, to the extent they relate in any way to the subject matter hereof. This Termination Agreement may not be supplemented, amended, or otherwise modified except by a writing signed by each Party.

(d) Any term or provision of this Termination Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction.

(e) THIS TERMINATION AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT REGARD TO CONFLICT OF LAWS RULES THEREOF.

(f) The Parties have negotiated this Termination Agreement at length, and have had the opportunity to consult with, and be represented by, their own counsel. The Parties understand and agree that they have carefully read and fully understand all of the provisions of this Termination Agreement, that they have retained the attorney of their choice who has explained to them the consequences of entering into this Termination Agreement and of being bound to each of the provisions of this Termination Agreement and that they freely and voluntarily consent to be bound by the provisions contained in this Termination Agreement.

3

(g) Each Party shall pay its own costs and expenses relating to the transactions contemplated by this Termination Agreement, including, without limitation, the fees and expenses of its counsel and financial advisers.

(h) This Termination Agreement may be executed in counterparts, and each counterpart shall for all purposes be deemed an original, and all such counterparts shall together constitute but one and the same agreement.

[Remainder of page intentionally left blank.]

4

IN WITNESS WHEREOF, the Parties hereto have executed and delivered this Termination Agreement as of the date first written above.

THE FIRST AMERICAN CORPORATION
By:	/s/ Kenneth D. DeGiorgio
Name:	Kenneth D. DeGiorgio
Title:	Senior Vice President
FIRST AMERICAN REAL ESTATE INFORMATION SERVICES, INC.
By:	/s/ Kenneth D. DeGiorgio
Name:	Kenneth D. DeGiorgio
Title:	Vice President
FIRST AMERICAN REAL ESTATE SOLUTIONS LLC
By:	/s/ Kenneth D. DeGiorgio
Name:	Kenneth D. DeGiorgio
Title:	Vice President

-Signature Page-

Termination and Release Agreement

FIRST AMERICAN REAL ESTATE SOLUTIONS II LLC
By:	/s/ Kenneth D. DeGiorgio
Name:	Kenneth D. DeGiorgio
Title:	Vice President
EXPERIAN INFORMATION SOLUTIONS, INC.
By:	/s/ Scott Leslie
Name:	Scott Leslie
Title:	Secretary

-Signature Page-

Termination and Release Agreement

EX-10.(SSS)

Exhibit (10)(sss)

EXECUTION COPY

$500,000,000

SECOND AMENDED AND RESTATED CREDIT AGREEMENT

dated as of

November 16, 2009

between

THE FIRST AMERICAN CORPORATION

The Lenders Party Hereto

and

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

J.P. MORGAN SECURITIES INC.,

as Sole Lead Arranger and Sole Bookrunner

COMERICA BANK, UNION BANK OF CALIFORNIA, N.A., US BANK and

WELLS FARGO BANK NATIONAL ASSOCIATION,

as Syndication Agents

Table of Contents

		Page
ARTICLE I DEFINITIONS
SECTION 1.01.	Defined Terms	1
SECTION 1.02.	Terms Generally	17
SECTION 1.03.	Accounting Terms and Determinations	17
ARTICLE II THE CREDITS
SECTION 2.01.	The Commitments	18
SECTION 2.02.	Loans and Borrowings	18
SECTION 2.03.	Requests for Borrowings	19
SECTION 2.04.	Funding of Borrowings	20
SECTION 2.05.	Interest Elections	20
SECTION 2.06.	Termination, Reduction and Increase of the Commitments	21
SECTION 2.07.	Repayment of Loans; Evidence of Debt	23
SECTION 2.08.	Prepayment of Loans	24
SECTION 2.09.	Fees	25
SECTION 2.10.	Interest	25
SECTION 2.11.	Alternate Rate of Interest	26
SECTION 2.12.	Increased Costs	26
SECTION 2.13.	Break Funding Payments	27
SECTION 2.14.	Taxes	28
SECTION 2.15.	Payments Generally; Pro Rata Treatment; Sharing of Set-offs	29
SECTION 2.16.	Mitigation Obligations; Replacement of Lenders	30
SECTION 2.17.	Extension of Commitment Termination Date	31
ARTICLE III REPRESENTATIONS AND WARRANTIES
SECTION 3.01.	Organization; Powers	33
SECTION 3.02.	Authorization; Enforceability	33
SECTION 3.03.	Governmental Approvals; No Conflicts	33
SECTION 3.04.	Financial Condition, Etc	33
SECTION 3.05.	Properties	34
SECTION 3.06.	Litigation and Environmental Matters	34
SECTION 3.07.	Compliance with Laws and Agreements	35
SECTION 3.08.	Investment and Holding Company Status	35
SECTION 3.09.	Taxes, Etc	35

SECTION 3.10.	ERISA	35
SECTION 3.11.	Disclosure	35
SECTION 3.12.	Use of Credit	36
SECTION 3.13.	Indebtedness and Liens	36
ARTICLE IV CONDITIONS
SECTION 4.01.	Second Amended and Restated Effective Date	36
SECTION 4.02.	Each Credit Event	36
ARTICLE V AFFIRMATIVE COVENANTS
SECTION 5.01.	Financial Statements and Other Information	37
SECTION 5.02.	Notices of Material Events	40
SECTION 5.03.	Existence; Conduct of Business	41
SECTION 5.04.	Payment of Obligations	41
SECTION 5.05.	Maintenance of Properties	41
SECTION 5.06.	Books and Records; Inspection Rights	41
SECTION 5.07.	Compliance with Laws and Agreements	42
SECTION 5.08.	Insurance	42
ARTICLE VI NEGATIVE COVENANTS
SECTION 6.01.	Indebtedness	42
SECTION 6.02.	Liens	43
SECTION 6.03.	Fundamental Changes	44
SECTION 6.04.	Transactions with Affiliates	45
SECTION 6.05.	Financial Covenants	45
SECTION 6.06.	Foreclosure on Subject Property	46
SECTION 6.07.	Sale/Leaseback Transactions and Synthetic Leases	46
ARTICLE VII EVENTS OF DEFAULT
ARTICLE VIII THE ADMINISTRATIVE AGENT

ARTICLE IX MISCELLANEOUS
SECTION 9.01.	Notices	51
SECTION 9.02.	Waivers; Amendments	52
SECTION 9.03.	Expenses; Indemnity; Damage Waiver	53
SECTION 9.04.	Successors and Assigns	54
SECTION 9.05.	Survival	57
SECTION 9.06.	Counterparts; Integration; Effectiveness	57
SECTION 9.07.	Severability	57
SECTION 9.08.	Right of Setoff	57
SECTION 9.09.	Governing Law; Jurisdiction; Etc	58
SECTION 9.10.	WAIVER OF JURY TRIAL	58
SECTION 9.11.	Headings	59
SECTION 9.12.	Treatment of Certain Information; Confidentiality	59
SECTION 9.13.	USA PATRIOT Act	60
SECTION 9.14.	Effect of Second Amended and Restated Credit Agreement	60

EXHIBIT A	-	Form of Assignment and Assumption
EXHIBIT B	-	Form of Additional Commitment Agreement

SECOND AMENDED AND RESTATED CREDIT AGREEMENT dated as of November 16, 2009, between THE FIRST AMERICAN CORPORATION, the LENDERS party hereto, and JPMORGAN CHASE BANK, N.A., as Administrative Agent.

The Borrower (as hereinafter defined), certain lenders and JPMorgan Chase Bank, N.A., as the administrative agent thereunder are parties to the Amended and Restated Credit Agreement dated as of November 7, 2005 (the “Original Closing Date”), as amended by Amendment No. 1 and Waiver dated as of November 3, 2006 and Amendment No. 2 dated as of July 11, 2007 (as so amended and in effect immediately prior to the effectiveness of this Agreement, the “Existing Credit Agreement”);

The Borrower and certain of the lenders party to the Existing Credit Agreement desire that the Existing Credit Agreement be amended in certain respects and to be restated in its entirety, and accordingly, the Borrower and the Administrative Agent with the consent of such lenders hereby agree to amend the Existing Credit Agreement and the parties hereto hereby agree to restate the Existing Credit Agreement, as so amended, in its entirety, effective as of the Second Amended and Restated Effective Date (as hereinafter defined). The execution and delivery of this Agreement shall not constitute a novation of the Existing Credit Agreement and all parties to the Existing Credit Agreement shall continue as parties to this agreement;

Accordingly, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have the meanings specified below:

“ABR”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans constituting such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.

“Additional Commitment Lender” means any Person that agrees to provide a Commitment of (in the case of an existing Lender) agrees to increase the amount of its Commitment pursuant to Section 2.17, in each case with the consent of the Administrative Agent (such consent not to be unreasonably withheld).

“Adjusted LIBO Rate” means, for the Interest Period for any Eurodollar Borrowing, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate for such Interest Period.

“Administrative Agent” means JPMCB, in its capacity as administrative agent for the Lenders hereunder. “Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified. Without limiting the generality of the foregoing, each of the following Persons shall, at all times, be Affiliates of the Borrower: Donald P. Kennedy, Parker S. Kennedy, any member of their immediate families (including parents, spouses, children and siblings), any trust whose principal beneficiary is Donald P. Kennedy or Parker S. Kennedy or one of more members of their immediate families and any Person who is controlled by such member or trust. Notwithstanding the foregoing, (a) no individual (other than any Person specified in the preceding sentence) shall be an Affiliate solely by reason of his or her being a director, officer or employee of the Borrower or any of its Subsidiaries and (b) none of the Subsidiaries of the Borrower shall be Affiliates.

“Alternate Base Rate” means, for any day, a rate per annum equal to the greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate for such day plus 1/2 of 1%. Any change in the Alternate Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective from and including the effective date of such change in the Prime Rate or the Federal Funds Effective Rate, as the case may be.

“Amendment No. 1 and Waiver Effective Date” means the effective date of Amendment No. 1 and Waiver dated as of November 3, 2006.

“Amendment No. 2 Effective Date” means the date on which Amendment No. 2 to this Agreement dated as of July 11, 2007 shall become effective.

“Applicable Additional Margin” means, for any Commitment Utilization Day, 0.10%.

“Applicable Bank Regulatory Authority” means, for any Bank Subsidiary, the Federal Deposit Insurance Corporation and all other relevant bank or thrift regulatory authorities (including, without limitation, relevant state bank or thrift regulatory authorities) having jurisdiction over such Bank Subsidiary.

“Applicable Insurance Regulatory Authority” means, when used with respect to any Insurance Company, the insurance department or similar administrative authority or agency of the State in which such Insurance Company is domiciled.

“Applicable Percentage” means, with respect to any Lender, the percentage of the total Commitments represented by such Lender’s Commitment. If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments.

“Applicable Rate” means, for any day, with respect to any Eurodollar Loan or ABR Loan, or with respect to the commitment fees payable hereunder, as the case may be, the applicable rate per annum set forth below under the caption “Eurodollar Spread”, “ABR Spread” or “Commitment Fee Rate”, respectively, based upon the Moody’s Rating and S&P Rating, respectively, applicable on such date:

2

Index Debt Ratings
Moody’s Rating	S&P Rating	Eurodollar Spread		ABR Spread		Commitment Fee Rate
A3 or above	A-or above	0.35	%	0	%	0.07	%
Baa1	BBB+	0.40	%	0	%	0.08	%
Baa2	BBB	0.45	%	0	%	0.09	%
Baa3	BBB-	0.55	%	0	%	0.125	%
Below Baa3	Below BBB-	0.75	%	0	%	0.175	%

For purposes of the foregoing, (i) if any of Moody’s or S&P shall not have in effect a Moody’s Rating or S&P Rating, as the case may be (other than by reason of the circumstances referred to in the last sentence of this definition), then such rating agency shall be deemed to have established a rating equivalent to the rating provided by the rating agency then having a rating in effect; (ii) if the Moody’s Rating and S&P Rating established or deemed to have been established shall fall within different rating categories, the Applicable Rate shall be based on the lower of the two ratings, provided that if one of the two ratings is two or more categories lower than the other, the Applicable Rate shall be determined by reference to the category next above that of the lower of the two ratings; and (iii) if the Moody’s Rating and S&P Rating established or deemed to have been established by Moody’s and S&P shall be changed (other than as a result of a change in the rating system of Moody’s or S&P), such change shall be effective as of the date on which it is first announced by the applicable rating agency. Each change in the Applicable Rate shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change. If the rating system of Moody’s or S&P shall change, or if either such rating agency shall cease to be in the business of rating corporate debt obligations, the Borrower and the Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such rating agency and, pending the effectiveness of any such amendment, the Applicable Rate shall be determined by reference to the rating most recently in effect prior to such change or cessation.

“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arbitrage Loans” means loans made by any financial institution (a “lender”) which is, at the time of the making of such loan, a depository of the Borrower or any Subsidiary of the Borrower, to the Borrower or any such Subsidiary in an amount not exceeding the amount of the deposits of the Borrower or any such Subsidiary held by such depository, the proceeds of which are invested in U.S. Government securities and/or certificates of deposit rated A-1 or P-1 and/or commercial paper rated not lower than A-1 or P-1 and having a term not exceeding the maturity date of such loan (but in no event

3

longer than 92 days), provided that (i) the relevant borrower shall have a right of offset against such investment (in the case of certificates of deposit) and (ii) all such loans must be off the balance sheet of the Borrower and its Subsidiaries at the last day of any quarterly fiscal period.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender as assignor and an assignee (with the consent of each Person whose consent is required by Section 9.04(b)), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.

“Assuming Lender” has the meaning assigned to such term in Section 2.06(d).

“Availability Period” means the period from and including the Original Closing Date to but excluding the earlier of the Commitment Termination Date and the date of termination of the Commitments.

“Bank Subsidiary” means First Security Thrift, First American Trust and any other Subsidiary of the Borrower which is a federally- or state-chartered thrift, bank or trust company.

“Board” means the Board of Governors of the Federal Reserve System of the United States of America. “Borrower” means The First American Corporation, a California corporation.

“Borrowing” means (a) all ABR Loans made, converted or continued on the same date or (b) all Eurodollar Loans that have the same Interest Period. For purposes hereof, the date of a Borrowing comprising one or more Loans that have been converted or continued shall be the effective date of the most recent conversion or continuation of such Loan or Loans.

“Borrowing Request” means a request by the Borrower for a Borrowing in accordance with Section 2.03.

“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, when used in connection with a Eurodollar Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in Dollar deposits in the London interbank market.

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

“Capital Securities” means preferred securities issued by a Subsidiary of the Borrower organized as a Delaware business trust that are redeemable, at the option of

4

such issuer, ten years or more after the issuance thereof, which securities are guaranteed by the Borrower and the proceeds of which are invested in junior subordinated securities of the Borrower.

“Change in Law” means (a) the adoption of any law, rule or regulation after the date of this Agreement, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) compliance by any Lender (or, for purposes of Section 2.12(b), by any lending office of such Lender or by such Lender’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement.

“Change of Control” means that during any period of 25 consecutive calendar months, a majority of the board of directors of the Borrower shall no longer be composed of individuals (a) who were members of said board on the first day of such period, (b) whose election or nomination to said board was approved by individuals referred to in clause (a) above constituting at the time of such election or nomination at least a majority of said board or (c) whose election or nomination to said board was approved by individuals referred to in clauses (a) and (b) above constituting at the time of such election or nomination at least a majority of said board.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Combined Earnings” means, for any period, the sum of the following: (a) consolidated earnings (calculated as net income attributable to the Borrower, plus net income attributable to noncontrolling interests, plus income taxes, plus Interest Expense) of the Borrower and its Consolidated Subsidiaries (determined on a consolidated basis without duplication in accordance with GAAP) for such period plus depreciation and amortization (to the extent deducted in determining such consolidated earnings) for such period plus (b) Deferred Revenues (or, in the case of a Deferred Revenue deficit, minus an amount equal to such deficit) for such period.

“Commitment” means, with respect to each Lender, the commitment of such Lender to make Loans hereunder, expressed as an amount representing the maximum aggregate amount of such Lender’s Revolving Credit Exposure hereunder, as such commitment may be (a) reduced or increased from time to time pursuant to Section 2.06 or Section 2.17 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04. The initial amount of each Lender’s Commitment is set forth on Schedule I, or in the Assignment and Assumption (or, in the case of any Assuming Lender, the agreement entered into by such Assuming Lender under Section 2.06(d)) pursuant to which such Lender shall have assumed its Commitment, as applicable. The aggregate amount of the Lenders’ Commitments is $500,000,000.

“Commitment Termination Date” means (a) July 11, 2012 (or if such date is not a Business Day, the immediately preceding Business Day) or (b) with respect to any

5

Lender the Commitment of which has been extended pursuant to Section 2.17, the date to which such Lender’s Commitment has been so extended.

“Commitment Utilization Day” means any day on which the aggregate outstanding principal amount of Loans shall exceed 50% of the total Commitments.

“Consolidated Subsidiary” means, for any Person, each Subsidiary of such Person (whether now existing or hereafter created or acquired) the financial statements of which shall be (or should have been) consolidated with the financial statements of such Person in accordance with GAAP. Notwithstanding anything herein to the contrary, for purposes of the definition of “Total Stockholders Equity” and Section 6.05 (and all defined terms as used therein) only, “Consolidated Subsidiary” shall not include FAC or any Subsidiary of FAC until the consummation of the FAC Transaction.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

“Deferred Revenues” means, with respect to the Borrower and its Consolidated Subsidiaries, for any fiscal period, the amount of revenue received but not recognized (in accordance with GAAP) during such fiscal period minus the amount of revenue recognized (in accordance with GAAP) but not received during such fiscal period.

“Disclosed Matters” means the actions, suits, proceedings and environmental matters disclosed in Schedule III.

“Dollars” or “$” refers to lawful money of the United States of America.

“Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the management, release or threatened release of any Hazardous Material or to health and safety matters.

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

6

“Equity Issuance” means (a) any issuance or sale by the Borrower of (i) any capital stock, (ii) any warrants or options exercisable in respect of capital stock (other than any warrants or options issued to directors, officers or employees of the Borrower or any of its Subsidiaries in their capacity as such and any capital stock of the Borrower issued upon the exercise of such warrants) or (iii) any other security or instrument representing an equity interest (or the right to obtain any equity interest) in the Borrower or (b) the receipt by the Borrower of any contribution to its capital (whether or not evidenced by any equity security).

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day notice period is waived); (b) the existence with respect to any Plan of an “accumulated funding deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.

“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans constituting such Borrowing, are bearing interest at a rate determined by reference to the Adjusted LIBO Rate.

“Event of Default” has the meaning assigned to such term in Article VII.

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits

7

taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 2.16(b)), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement or is attributable to such Foreign Lender’s failure or inability to comply with Section 2.14(e), except to the extent that such Foreign Lender’s assignor (if any) was entitled, at the time of assignment, to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 2.14(a).

“Existing Commitment Termination Date” has the meaning assigned to such term in Section 2.17(a).

“Existing Credit Agreement” has the meaning specified in the preliminary statements hereto.

“Extension Effective Date” has the meaning assigned to such term in Section 2.17(a).

“Extension Request” has the meaning assigned to such term in Section 2.17(a).

“FAC” means First Advantage Corporation, a Delaware corporation and a Subsidiary of the Borrower.

“FAC Credit Agreement” means the Credit Agreement dated as of September 28, 2005 among FAC, as borrower, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, LaSalle Bank National Association, as Syndication Agent, Wachovia Bank, National Association and SunTrust Bank, as Co-Documentation Agents and the other lenders party thereto, as amended from time to time.

“FAC Transaction” means any transaction or series of transactions pursuant to which the Borrower and/or any of its Subsidiaries shall acquire or attempt to acquire, by merger, purchase or otherwise, shares of the common stock of FAC, including (without limitation) any merger or consolidation of any Subsidiary of the Borrower with or into FAC or any tender or exchange offer for such shares, provided that the consideration offered by the Borrower and its Subsidiaries in such transaction or series of transactions shall consist only (other than cash paid for fractional shares) of shares of capital stock of the Borrower (or warrants, options or rights to acquire such capital stock) or cash representing the proceeds (net of underwriting discounts) of any issuances by the Borrower to the third parties of shares of its capital stock (or warrants, options or rights to acquire such capital stock) on or after the Second Amended and Restated Effective Date.

“FAREISI” means First American Real Estate Information Services, Inc., a California corporation and a Wholly Owned Subsidiary of the Borrower.

“FATICO” means First American Title Insurance Company, a California corporation and a Wholly Owned Subsidiary of the Borrower.

8

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.

“First American Title & Trust Company” means First American Title & Trust Company, an Oklahoma corporation and a Subsidiary of the Borrower.

“First American Trust” means First American Trust FSB, a federal stock savings bank and a Wholly Owned Subsidiary of the Borrower.

“First Security Thrift” means First Security Business Bank, a California corporation and an indirect Subsidiary of FATICO.

“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is located. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

“Funded Debt” means, for any Person, (a) all Indebtedness for such Person that should be reflected on a balance sheet of such Person in accordance with GAAP, (b) all Indebtedness of any other Person that should be reflected on a balance sheet of such other Person in accordance with GAAP and that is secured by a Lien on the property of such Person, is supported by a letter of credit issued for account of, or is Guaranteed by, such Person and (c) all Capital Lease Obligations of such Person; provided that Funded Debt shall include (i) the aggregate liquidation preference of all preferred securities that are mandatorily redeemable, exchangeable or convertible into debt at the option of the holder or redeemable at the option of the holder, less than ten years after issue and (ii) the aggregate liquidation preference of all Capital Securities but only that portion of such aggregate liquidation preference that is on such date in excess of 15% of Total Capitalization on such date.

“GAAP” means generally accepted accounting principles in the United States of America.

“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary

9

obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business.

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind that in accordance with GAAP would be shown on the liability side of the balance sheet of such Person, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments (including surplus debentures or notes whether or not characterized as liabilities for purposes of GAAP or SAP and non-perpetual preferred stock requiring redemption or repurchase and any option exercisable in respect thereof to the extent of such redemption or repurchase), (c) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person that in accordance with GAAP would be shown on the liability side of the balance sheet of such Person, (d) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business) that in accordance with GAAP would be shown on the liability side of the balance sheet of such Person, (e) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (f) all Guarantees by such Person of Indebtedness of others, (g) all Capital Lease Obligations of such Person, (h) all obligations, contingent or otherwise of such Person as an account party in respect of letters of credit and letters of guaranty and (i) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances; provided that the Indebtedness shall include the aggregate liquidation preference of all Capital Securities but only that portion of such aggregate liquidation preference that is on such date in excess of 15% of Total Capitalization on such date. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

10

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Index Debt” means senior, unsecured, long-term indebtedness for borrowed money of the Borrower that is not guaranteed by any other Person or subject to any other credit enhancement; provided that if such indebtedness is not rated by Moody’s or S&P, “Index Debt” means indebtedness in respect of Capital Securities.

“Insurance Company” means, collectively, FATICO, First American Home Buyers Protection Corporation and any other Subsidiary of the Borrower which is a licensed insurance company or a licensed underwritten title company.

“Interest Election Request” means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.05.

“Interest Expense” means, for any period, the sum, for the Borrower and its Consolidated Subsidiaries (determined on a consolidated basis without duplication in accordance with GAAP), of the following: (a) all interest in respect of Indebtedness accrued during such period (whether or not actually paid during such period) plus (b) the net amounts payable (or minus the net amounts receivable) under Swap Agreements accrued during such period (whether or not actually paid or received during such period).

“Interest Payment Date” means (a) with respect to any ABR Loan, each Quarterly Date and (b) with respect to any Eurodollar Loan, the last day of each Interest Period therefor and, in the case of any Interest Period that is more than three months long, each day prior to the last day of such Interest Period that occurs at intervals of three months after the first day of such Interest Period.

“Interest Period” means (a) for any Borrowing (other than an ABR Borrowing), the Interest Period of the Loan or Loans constituting such Borrowing; and (b) for any Eurodollar Loan, the period commencing on the date of such Loan and ending on the numerically corresponding day in the calendar month that is one, two, three or six months or (if agreed to by all Lenders) nine or twelve months thereafter, as specified in the applicable Borrowing Request or Interest Election Request; provided that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of a Loan initially shall be the date on which such Loan is made and thereafter shall be the effective date of the most recent conversion or continuation of such Loan.

“JPMCB” means JPMorgan Chase Bank, N.A.

“Lenders” means the Persons listed on Schedule I and any other Person that shall have become a party hereto pursuant to an Assignment and Assumption or an instrument

11

executed by such Person pursuant to Section 2.06(d), other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.

“LIBO Rate” means, for the Interest Period for any Eurodollar Borrowing, the rate appearing on Page 3750 of the Telerate Service (or on any successor or substitute page of such Service, or any successor to or substitute for such Service, providing rate quotations comparable to those currently provided on such page of such Service, as determined by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to Dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, as the rate for the offering of Dollar deposits with a maturity comparable to such Interest Period. In the event that such rate is not available at such time for any reason, then the LIBO Rate for such Interest Period shall be the arithmetic mean of the rates (rounded upwards, if necessary, to the next 1/16 of 1%) at which Dollar deposits of $5,000,000 and for a maturity comparable to such Interest Period are offered by the principal London office of the Administrative Agent in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period.

“Licenses” means any licenses or certificates of authority from any Applicable Insurance Regulatory Authority, or permits or authorizations to transact title insurance business.

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset.

“Loan” means a Loan made pursuant to Section 2.01.

“Loans” means the loans made by the Lenders to the Borrower pursuant to this Agreement.

“Margin Stock” means “margin stock” within the meaning of Regulations T, U and X of the Board.

“Material Adverse Effect” means a material adverse effect on (a) the business, assets, operations, prospects or condition, financial or otherwise, of the Borrower and its Subsidiaries taken as a whole, (b) the ability of the Borrower to perform any of its obligations under this Agreement or (c) the rights of or benefits available to the Lenders under this Agreement.

“Material Indebtedness” means Indebtedness, or obligations in respect of one or more Swap Agreements, of any one or more of the Borrower and its Subsidiaries in an aggregate principal amount exceeding $50,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or any Subsidiary in respect of any Swap Agreement at any time shall be the maximum

12

aggregate amount (giving effect to any netting agreements) that the Borrower or such Subsidiary would be required to pay if such Swap Agreement were terminated at such time.

“Material Subsidiary” means, at any time, (a) FATICO, (b) FAREISI and (c) any other Subsidiary of the Borrower with a net book value that equals or exceeds 5% of the Borrower’s consolidated shareholders’ equity (determined as of the last day of the most recently ended fiscal quarter for which financial statements are available).

“Moody’s” means Moody’s Investors Service, Inc.

“Moody’s Rating” means the Moody’s rating in respect of the Index Debt, provided that if such rating is in respect of Index Debt consisting of Capital Securities, “Moody’s Rating” means the rating that is one grade higher than the rating of the Index Debt.

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

“Non-Extending Lender” has the meaning assigned to such term in Section 2.17(a).

“Original Closing Date” has the meaning assigned to such term in the recitals to this Agreement.

“Other Taxes” means any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

“Permitted Encumbrances” means (a) Liens imposed by law for taxes, assessments or other governmental charges that are not yet due or are being contested in compliance with Section 5.04; (b) carriers’, warehousemen’s, mechanics’, materialmen’s, landlords’, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than 30 days or are being contested in compliance with Section 5.04; (c) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations; (d) deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business; (e) judgment liens in respect of judgments that do not constitute an Event of Default under clause (j) of Article VII; and (f) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the

13

ordinary conduct of business of the Borrower or any Subsidiary; provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Prime Rate” means the rate of interest per annum publicly announced from time to time by JPMCB as its prime rate in effect at its principal office in New York City; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.

“Quarterly Dates” means the 7th day of February, May, August and November in each year, the first of which shall be the first such day after the date hereof; provided that if any such day is not a Business Day, then such Quarterly Date shall be the next succeeding Business Day (unless such succeeding Business Day falls in a subsequent calendar month, in which event such Quarterly Date shall be the next preceding Business Day).

“Register” has the meaning set forth in Section 9.04.

“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.

“Required Lenders” means, at any time, Lenders having Revolving Credit Exposures and unused Commitments representing more than 50% of the sum of the total Revolving Credit Exposures and unused Commitments at such time.

“Reserves” means, for any Insurance Company, as at any date, the aggregate reserves for undetermined title losses of such Insurance Company (which amount is shown at the Original Closing Date on the then most recent annual Statutory Statement of such Insurance Company at page 3, line 2, column 1) as at the last day of the fiscal year of such Insurance Company ending on or most recently ended prior to such date.

“Revolving Credit Exposure” means, with respect to any Lender at any time, the aggregate outstanding principal amount of such Lender’s Loans at such time.

“S&P” means Standard & Poor’s Ratings Services.

“S&P Rating” means the S&P rating in respect of the Index Debt, provided that if such rating is in respect of Index Debt consisting of Capital Securities, “S&P Rating” means the rating that is one grade higher than the rating of the Index Debt.

14

“Sale/Leaseback Transaction” means any arrangement with any Person whereby the Borrower or any of its Subsidiaries shall sell or otherwise transfer any of its property and thereafter rent or lease such property or similar property for substantially the same use or uses as the property sold or transferred.

“SAP” means, for any Insurance Company, the statutory accounting procedures or practices required by the Applicable Insurance Regulatory Authority applied on a basis consistent with those which, in accordance with the last sentence of Section 1.03(a), are to be used in making the calculations for purposes of determining compliance with certain terms of this Agreement.

“SEC” has the meaning set forth in Section 5.01(i).

“Second Amended and Restated Effective Date” has the meaning set forth in Section 4.01.

“Statutory Reserve Rate” means, for the Interest Period for any Eurodollar Borrowing, a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the arithmetic mean, taken over each day in such Interest Period, of the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject for eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

“Statutory Statement” means, for any Insurance Company, for any fiscal year of such Insurance Company, the most recent annual statement required to be filed with the Applicable Insurance Regulatory Authority and, for any fiscal quarter of such Insurance Company, the quarterly statement required to be filed with the Applicable Insurance Regulatory Authority, which annual and quarterly statements shall be prepared in accordance with statutory accounting practices or generally accepted accounting principles as specified by the Applicable Insurance Regulatory Authority.

“Subject Property” has the meaning assigned to such term in Section 6.06.

“Subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the

15

ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent. Unless otherwise specified, “Subsidiary” means a Subsidiary of the Borrower. “Wholly Owned Subsidiary” means any such corporation, partnership or other entity of which all of the equity securities or other ownership interests (other than, in the case of a corporation, directors’ qualifying shares) are so owned or controlled. Notwithstanding anything herein to the contrary, for purposes of Article VI only (other than Section 6.06), “Subsidiary” shall not include FAC or any Subsidiary of FAC until the consummation of the FAC Transaction.

“Swap Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Borrower or the Subsidiaries shall be a Swap Agreement.

“Synthetic Lease” means a lease of property or assets designed to permit the lessee (a) to claim depreciation on such property or assets under U.S. tax law and (b) to treat such lease as an operating lease or not to reflect the leased property or assets on the lessee’s balance sheet under GAAP.

“Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority.

“Total Capitalization” means, as at any date, the sum of Total Debt plus Total Stockholders’ Equity.

“Total Debt” means, as at any date, the sum for the Borrower and its Consolidated Subsidiaries of all Funded Debt.

“Total Stockholders’ Equity” means, as at any date, the aggregate stockholders’ equity (including minority interests in subsidiaries) for the Borrower and its Consolidated Subsidiaries; provided that the aggregate liquidation preference of Capital Securities shall be included in the calculation of Total Stockholders’ Equity only with respect to that portion of such aggregate liquidation preference that is less than 15% of Total Capitalization on such date.

“Transactions” means the execution, delivery and performance by the Borrower of this Agreement, the borrowing of Loans and the use of the proceeds thereof.

“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans constituting such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.

16

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

SECTION 1.02. Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

SECTION 1.03. Accounting Terms and Determinations.

(a) Except as otherwise expressly provided herein, all accounting terms used herein shall be interpreted, and all financial statements and certificates and reports as to financial matters required to be delivered to the Lenders hereunder shall (unless otherwise disclosed to the Lenders in writing at the time of delivery thereof in the manner described in subsection (b) below) be prepared, in accordance with (in the case of the Borrower and its Subsidiaries on a consolidated basis) GAAP or (in the case of certain of the Insurance Companies) statutory accounting practices, as the case may be, applied on a basis consistent with those used in the preparation of the latest financial statements furnished to the Lenders hereunder (which, prior to the delivery of the first financial statements (after the date hereof) under Section 5.01, shall mean the financial statements as at March 31, 2009 referred to in Section 3.04(a)). All calculations made for the purposes of determining compliance with this Agreement shall (except as otherwise expressly provided herein) be made by application of (in the case of the Borrower and its Subsidiaries on a consolidated basis) GAAP or (in the case of certain of the Insurance Companies) statutory accounting practices, as the case may be, applied on a basis consistent with those used in the preparation of the latest annual or quarterly financial statements furnished to the Lenders pursuant to Section 5.01 (or, prior to the delivery of the first financial statements (after the date hereof) under Section 5.01, used in the preparation of the financial statements as at March 31, 2009 referred to in Section 3.04(a)) unless (i) the Borrower shall have objected to determining such compliance on such basis at the time of delivery of such financial statements or (ii) the Required Lenders shall so object within 30 days after delivery of such financial statements, in either of which events such calculations shall be made on a basis consistent with those used in the preparation of the latest financial statements as to which such objection shall

17

not have been made (which, if objection is made in respect of the first financial statements delivered under Section 5.01, shall mean the financial statements referred to in Section 3.04(a)).

(b) The Borrower shall deliver to the Lenders at the same time as the delivery of any annual or quarterly financial statement under Section 5.01 (i) a description in reasonable detail of any material variation between the application of accounting principles or practices employed in the preparation of such statement and the application of accounting principles or practices employed in the preparation of the next preceding annual or quarterly financial statements as to which no objection has been made in accordance with the last sentence of subsection (a) above and (ii) reasonable estimates of the difference between such statements arising as a consequence thereof.

(c) Notwithstanding anything to the contrary herein, the Borrower and the Lenders agree that, if after the date hereof, changes to GAAP become effective so as to require the reduction of the carrying amount of goodwill upon impairment (including, without limitation, as a result of the establishment of a benchmark), disposition of assets, discontinuance of operations or other similar events, then, for purposes of calculating compliance with the covenants set forth in Section 6.05, each such reduction shall be treated as an extraordinary non-cash item and shall be disregarded.

(d) The Borrower will not change the last day of its fiscal year from December 31 of each year, or the last days of the first three fiscal quarters in each of its fiscal years from March 31, June 30 and September 30 of each year, respectively.

ARTICLE II

THE CREDITS

SECTION 2.01. The Commitments. Subject to the terms and conditions set forth herein, each Lender agrees to make Loans to the Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in (a) such Lender’s Revolving Credit Exposure exceeding such Lender’s Commitment or (b) the total Revolving Credit Exposures exceeding the total Commitments. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Loans.

SECTION 2.02. Loans and Borrowings.

(a) Obligations of Lenders. Each Loan shall be made as part of a Borrowing consisting of Loans of the same Type made by the Lenders ratably in accordance with their respective Commitments. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.

(b) Type of Loans. Subject to Section 2.11, each Borrowing shall be constituted entirely of ABR Loans or Eurodollar Loans as the Borrower may request in accordance herewith.

18

Each Lender at its option may make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.

(c) Minimum Amounts; Limitation on Number of Borrowings. At the commencement of the Interest Period for any Eurodollar Borrowing, such Borrowing shall be in an aggregate amount of $5,000,000 or a larger multiple of $1,000,000. At the time that each ABR Borrowing is made, such Borrowing shall be in an aggregate amount equal to $3,000,000 or a larger multiple of $500,000; provided that an ABR Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Commitments. Borrowings of more than one Type may be outstanding at the same time; provided that there shall not at any time be more than a total of five Eurodollar Borrowings outstanding.

(d) Limitations on Lengths of Interest Periods. Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert to or continue as a Eurodollar Borrowing, any Borrowing if the Interest Period requested therefor would end after the Commitment Termination Date.

SECTION 2.03. Requests for Borrowings. To request a Borrowing, the Borrower shall notify the Administrative Agent of such request by telephone (a) in the case of a Eurodollar Borrowing, not later than 1:00 p.m., New York City time, three Business Days before the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 1:00 p.m., New York City time, two Business Days before the date of the proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Borrowing Request in a form approved by the Administrative Agent and signed by the Borrower. Each such telephonic and written Borrowing Request shall specify the following information in compliance with Section 2.02:

(i) the aggregate amount of the requested Borrowing;

(ii) the date of such Borrowing, which shall be a Business Day;

(iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;

(iv) in the case of a Eurodollar Borrowing, the Interest Period therefor, which shall be a period contemplated by the definition of the term “Interest Period”; and

(v) the location and number of the Borrower’s account to which funds are to be disbursed, which shall comply with the requirements of Section 2.04.

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an ABR Borrowing. If no Interest Period is specified with respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration. Promptly following receipt of a Borrowing Request in accordance with this

19

Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

SECTION 2.04. Funding of Borrowings.

(a) Funding by Lenders. Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, New York City time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account of the Borrower maintained with the Administrative Agent in New York City and designated by the Borrower in the applicable Borrowing Request.

(b) Presumption by the Administrative Agent. Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, the Federal Funds Effective Rate or (ii) in the case of the Borrower, the interest rate applicable to ABR Loans. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing.

SECTION 2.05. Interest Elections.

(a) Elections by the Borrower for Borrowings. Each Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall have the Interest Period specified in such Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing to a Borrowing of a different Type or to continue such Borrowing as a Borrowing of the same Type and, in the case of a Eurodollar Borrowing, may elect the Interest Period therefor, all as provided in this Section. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans constituting such Borrowing, and the Loans constituting each such portion shall be considered a separate Borrowing.

(b) Notice of Elections. To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Borrowing of the Type resulting from such election to be made on the effective date of such election. Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written

20

Interest Election Request in a form approved by the Administrative Agent and signed by the Borrower.

(c) Information in Interest Election Requests. Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02:

(i) the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) of this paragraph shall be specified for each resulting Borrowing);

(ii) the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and

(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period therefor after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.

(d) Notice by the Administrative Agent to Lenders. Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.

(e) Failure to Elect; Events of Default. If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Borrowing prior to the end of the Interest Period therefor, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period therefor.

SECTION 2.06. Termination, Reduction and Increase of the Commitments.

(a) Scheduled Termination. Unless previously terminated, the Commitments shall terminate on the Commitment Termination Date.

(b) Voluntary Termination or Reduction. The Borrower may at any time terminate, or from time to time reduce, the Commitments; provided that (i) each reduction of the

21

Commitments shall be in an amount that is $3,000,000 or a larger multiple of $500,000 and (ii) the Borrower shall not terminate or reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with Section 2.08, the total Revolving Credit Exposures would exceed the total Commitments.

(c) Notice of Voluntary Termination or Reduction. The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Commitments under paragraph (b) of this Section at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section shall be irrevocable; provided that a notice of termination of the Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. Any termination or reduction of the Commitments shall be permanent. Each reduction of the Commitments shall be made ratably among the Lenders in accordance with their respective Commitments.

(d) Increase of the Commitments. The Borrower may, at any time by notice to the Administrative Agent, propose an increase in the total Commitments hereunder (each such proposed increase being a “Commitment Increase”) either by having a Lender increase its Commitment then in effect (each an “Increasing Lender”) or by adding as a Lender with a new Commitment hereunder a Person which is not then a Lender (each an “Assuming Lender”) in each case with the approval of the Administrative Agent (not to be unreasonably withheld), which notice shall specify the name of each Increasing Lender and/or Assuming Lender, as applicable, the amount of the Commitment Increase and the portion thereof being assumed by each such Increasing Lender or Assuming Lender, and the date on which such Commitment Increase is to be effective (a “Commitment Increase Date”) (which shall be a Business Day at least three Business Days after delivery of such notice and 30 days prior to the Commitment Termination Date); provided that no Lender shall have any obligation hereunder to become an Increasing Lender and any election to do so shall be in the sole discretion of each Lender; provided further that:

(i) the amount of any Commitment Increase, and the amount of the Commitment of any Assuming Lender as part of any Commitment Increase, shall be in a minimum amount of $10,000,000 and in multiples of $5,000,000;

(ii) immediately after giving effect to any Commitment Increase, the total Commitments hereunder shall not exceed $750,000,000;

(iii) no Default shall have occurred and be continuing on the relevant Commitment Increase Date or shall result from any Commitment Increase; and

(iv) the representations and warranties of the Borrower set forth in this Agreement shall be true and correct on and as of the relevant Commitment Increase Date as if made on and as of such date (or, if any such representation or

22

warranty is expressly stated to have been made as of a specific date, as of such specific date).

Each Commitment Increase (and the increase of the Commitment of each Increasing Lender and/or the new Commitment of each Assuming Lender, as applicable, resulting therefrom) shall become effective as of the relevant Commitment Increase Date upon receipt by the Administrative Agent, on or prior to 9:00 a.m., New York City time, on such Commitment Increase Date, of (A) a certificate of a duly authorized officer of the Borrower stating that the conditions with respect to such Commitment Increase under this paragraph (d) have been satisfied and (B) an agreement, in form and substance satisfactory to the Borrower and the Administrative Agent, pursuant to which, effective as of such Commitment Increase Date, the Commitment of each such Increasing Lender shall be increased or each such Assuming Lender, as applicable, shall undertake a Commitment, duly executed by such Increasing Lender or Assuming Lender, as the case may be, and the Borrower and acknowledged by the Administrative Agent. Upon the Administrative Agent’s receipt of a fully executed agreement from each Increasing Lender and/or Assuming Lender referred to in clause (B) above, together with the certificate referred to in clause (A) above, the Administrative Agent shall record the information contained in each such agreement in the Register and give prompt notice of the relevant Commitment Increase to the Borrower and the Lenders (including, if applicable, each Assuming Lender). On each Commitment Increase Date the Borrower shall simultaneously (i) prepay in full the outstanding Loans (if any) held by the Lenders immediately prior to giving effect to the relevant Commitment Increase, (ii) if the Borrower shall have so requested in accordance with this Agreement, borrow new Loans from all Lenders (including, if applicable, any Assuming Lender) such that, after giving effect thereto, the Loans are held ratably by the Lenders in accordance with their respective Commitments (after giving effect to such Commitment Increase) and (iii) pay to the Lenders the amounts, if any, payable under Section 2.13.

SECTION 2.07. Repayment of Loans; Evidence of Debt.

(a) Repayment. The Borrower hereby unconditionally promises to pay to the Administrative Agent for account of the Lenders the outstanding principal amount of the Loans on the Commitment Termination Date.

(b) Manner of Payment. Prior to any repayment or prepayment of any Borrowings hereunder, the Borrower shall select the Borrowing or Borrowings to be paid and shall notify the Administrative Agent by telephone (confirmed by telecopy) of such selection not later than 1:00 p.m., New York City time, three Business Days before the scheduled date of such repayment; provided that each repayment of Borrowings shall be applied to repay any outstanding ABR Borrowings before any other Borrowings. If the Borrower fails to make a timely selection of the Borrowing or Borrowings to be repaid or prepaid, such payment shall be applied, first, to pay any outstanding ABR Borrowings and, second, to other Borrowings in the order of the remaining duration of their respective Interest Periods (the Borrowing with the shortest remaining Interest Period to be repaid first). Each payment of a Borrowing shall be applied ratably to the Loans included in such Borrowing.

23

(c) Maintenance of Loan Accounts by Lenders. Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.

(d) Maintenance of Loan Accounts by the Administrative Agent. The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Type thereof and each Interest Period therefor, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for account of the Lenders and each Lender’s share thereof.

(e) Effect of Entries. The entries made in the accounts maintained pursuant to paragraph (c) or (d) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.

(f) Promissory Notes. Any Lender may request that Loans made by it be evidenced by a promissory note. In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a form approved by the Administrative Agent. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form payable to the order of the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).

SECTION 2.08. Prepayment of Loans.

(a) Optional Prepayments Right to Prepay Borrowings. The Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, subject to the requirements of this Section.

(b) Notices, Etc. The Borrower shall notify the Administrative Agent by telephone (confirmed by telecopy) of any optional prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not later than 1:00 p.m., New York City time, three Business Days before the date of prepayment or (ii) in the case of prepayment of an ABR Borrowing, not later than 1:00 p.m., New York City time, two Business Days before the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid; provided that, if a notice of prepayment is given in connection with a conditional notice of termination of the Commitments as contemplated by Section 2.06, then such notice of prepayment may be revoked if such notice of termination is revoked in accordance with Section 2.06. Promptly following receipt of any such notice relating to a Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case of a Borrowing of the same Type as provided in Section 2.02. Each prepayment of a Borrowing shall be applied ratably to the Loans included in the prepaid

24

Borrowing. Prepayments shall be accompanied by accrued interest to the extent required by Section 2.10 and shall be made in the manner specified in Section 2.07(b).

SECTION 2.09. Fees.

(a) Commitment Fee. The Borrower agrees to pay to the Administrative Agent for account of each Lender a commitment fee, which shall accrue at a rate per annum equal to the Applicable Rate on the average daily unused amount of the Commitment of such Lender during the period from and including the date hereof to but excluding the earlier of the date such Commitment terminates and the Commitment Termination Date. Accrued commitment fees shall be payable on each Quarterly Date and on the earlier of the date the Commitment terminates and the Commitment Termination Date, commencing on the first such date to occur after the date hereof. All commitment fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

(b) Administrative Agent Fees. The Borrower agrees to pay to the Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreed upon between the Borrower and the Administrative Agent.

(c) Payment of Fees. All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution, in the case of commitment fees, to the Lenders entitled thereto. Fees paid shall not be refundable under any circumstances.

SECTION 2.10. Interest.

(a) ABR Loans. The Loans constituting each ABR Borrowing shall bear interest at a rate per annum equal to the Alternate Base Rate plus the Applicable Rate plus the Applicable Additional Margin (if any).

(b) Eurodollar Loans. The Loans constituting each Eurodollar Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBO Rate for the Interest Period for such Borrowing plus the Applicable Rate plus the Applicable Additional Margin (if any).

(c) Default Interest. Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided above or (ii) in the case of any other amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section.

(d) Payment of Interest. Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Loan prior to the Commitment Termination Date), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii)

25

in the event of any conversion of any Eurodollar Borrowing prior to the end of the Interest Period therefor, accrued interest on such Borrowing shall be payable on the effective date of such conversion.

(e) Computation. All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate or Adjusted LIBO Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.

SECTION 2.11. Alternate Rate of Interest. If prior to the commencement of the Interest Period for a Eurodollar Borrowing:

(a) the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate for such Interest Period; or

(b) the Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing for such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR Borrowing.

SECTION 2.12. Increased Costs.

(a) Increased Costs Generally. If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate); or

(ii) impose on any Lender or the London interbank market any other condition affecting this Agreement or Eurodollar Loans made by such Lender;

and the result of any of the foregoing shall be to increase the cost to such Lenders of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan) or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender such additional

26

amount or amounts as will compensate such Lender for such additional costs incurred or reduction suffered.

(b) Capital Requirements. If any Lender determines that any Change in Law regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement or the Loans made by such Lender to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

(c) Certificates from Lenders. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

(d) Delay in Requests. Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than six months prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the six-month period referred to above shall be extended to include the period of retroactive effect thereof.

SECTION 2.13. Break Funding Payments. In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an Interest Period therefor (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan other than on the last day of an Interest Period therefor, (c) the failure to borrow, convert, continue or prepay any Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice is permitted to be revocable under Section 2.08(b) and is revoked in accordance herewith), or (d) the assignment of any Eurodollar Loan other than on the last day of an Interest Period therefor as a result of a request by the Borrower pursuant to Section 2.16, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar Loan, the loss to any Lender attributable to any such event shall be deemed to include an amount determined by such Lender to be equal to the excess, if any, of (i) the amount of interest that such Lender would pay for a deposit equal to the principal amount of such Loan for the period from the date of such payment, conversion, failure or assignment to the last day of the then current Interest Period for such Loan (or, in the case of a failure to borrow, convert or continue, the duration of the Interest Period that would have resulted from such borrowing, conversion or continuation) if the interest rate payable on such deposit were equal to the Adjusted LIBO Rate for such Interest Period, over (ii) the amount of interest that such Lender would earn on such principal amount for such period if such Lender

27

were to invest such principal amount for such period at the interest rate that would be bid by such Lender (or an affiliate of such Lender) for Dollar deposits from other banks in the eurodollar market at the commencement of such period. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

SECTION 2.14. Taxes.

(a) Payments Free of Taxes. Any and all payments by or on account of any obligation of the Borrower hereunder shall be made free and clear of and without deduction for any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Administrative Agent or Lender (as the case may be) receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.

(b) Payment of Other Taxes by the Borrower. In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c) Indemnification by the Borrower. The Borrower shall indemnify the Administrative Agent and each Lender, within 10 days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) paid by the Administrative Agent or such Lender, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender, or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(d) Evidence of Payments. As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(e) Foreign Lenders. Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law or reasonably requested by the Borrower, such properly

28

completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced rate.

SECTION 2.15. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

(a) Payments by the Borrower. The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest or fees, or under Section 2.12, 2.13 or 2.14, or otherwise) prior to 12:00 noon, New York City time, on the date when due, in immediately available funds, without set-off or counterclaim; provided that if a new Loan is to be made by any Lender on a date the Borrower is to repay any principal of an outstanding Loan of such Lender, such Lender shall apply the proceeds of such new Loan to the payment of the principal to be repaid and only an amount equal to the difference between the principal to be borrowed and the principal to be repaid shall be made available by such Lender to the Administrative Agent as provided in Section 2.04 or paid by the Borrower to the Administrative Agent pursuant to this paragraph, as the case may be. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at its offices at 270 Park Avenue, New York, New York, except that payments pursuant to Sections 2.12, 2.13, 2.14 and 9.03 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in Dollars.

(b) Application of Insufficient Payments. If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied (i) first, to pay interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, to pay principal then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal then due to such parties.

(c) Pro Rata Treatment. Except to the extent otherwise provided herein: (i) each Borrowing shall be made from the Lenders, each payment of commitment fees under Section 2.09 shall be made for account of the Lenders, and each termination or reduction of the amount of the Commitments under Section 2.06 shall be applied to the respective Commitments of the Lenders, pro rata according to the amounts of their respective Commitments; (ii) each Borrowing shall be allocated pro rata among the Lenders according to the amounts of their respective Commitments (in the case of the making of Loans) or their respective Loans (in the case of conversions and continuations of Loans); (iii) each payment or prepayment of principal of Loans by the Borrower shall be made for account of the Lenders pro rata in accordance with the respective unpaid principal amounts of the Loans held by them; and (iv) each payment of interest on Loans by the Borrower shall be made for account of the Lenders pro rata in accordance with the amounts of interest on such Loans then due and payable to the respective Lenders.

29

(d) Sharing of Payments by Lenders. If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Loans and accrued interest thereon then due than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

(e) Presumptions of Payment. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the Federal Funds Effective Rate.

(f) Certain Deductions by the Administrative Agent. If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.04(b) or 2.15(e), then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for account of such Lender to satisfy such Lender’s obligations under such Sections until all such unsatisfied obligations are fully paid.

SECTION 2.16. Mitigation Obligations; Replacement of Lenders.

(a) Designation of a Different Lending Office. If any Lender requests compensation under Section 2.12, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for account of any Lender pursuant to Section 2.14, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment

30

(i) would eliminate or reduce amounts payable pursuant to Section 2.12 or 2.14, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b) Replacement of Lenders. If (i) any Lender requests compensation under Section 2.12, (ii) the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for account of any Lender pursuant to Section 2.14, (iii) any Lender defaults in its obligation to fund Loans hereunder or (iv) any Lender is subject to a conservatorship or a receivership with, or is otherwise directly or indirectly under the control of, the Federal Deposit Insurance Corporation (or any successor thereto) or the Resolution Trust Company (or any successor thereto), then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (x) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not unreasonably be withheld, (y) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts) and (z) in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments required to be made pursuant to Section 2.14, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

SECTION 2.17. Extension of Commitment Termination Date. (a) The Borrower may, by notice to the Administrative Agent (which shall promptly notify the Lenders) not more than 90 days and not less than 30 days prior to each anniversary of the Amendment No. 2 Effective Date (or if such anniversary date is not a Business Day, the Business Date next succeeding such anniversary) (each such anniversary of the Amendment No. 2 Effective Date, an “Extension Effective Date”), request (each, an “Extension Request”) that each Lender extend the Commitment Termination Date then in effect for such Lender (the “Existing Commitment Termination Date”) for an additional one year; provided that only two Extension Requests may be requested hereunder. Each Lender, acting in its sole discretion, shall, by notice to the Borrower and the Administrative Agent given not later than the 20th day (or such later day as shall be acceptable to the Borrower) following the date of the Borrower’s notice, advise the Borrower and the Administrative Agent whether or not such Lender agrees to such extension; provided that any Lender that does not so advise the Borrower shall be deemed to have rejected such Extension Request (any such Lender which shall have rejected or is deemed to have rejected such extension being a “Non-Extending Lender”). The election of any Lender to agree to such extension shall not obligate any other Lender to so agree, and such election shall become effective only as provided under paragraph (c) of this Section.

31

(b) The Borrower shall have the right, at any time on or prior to, or at any time following, the relevant Extension Effective Date, unless an Event of Default shall have occurred and be continuing, to replace any Non-Extending Lender with, and otherwise add to this Agreement, one or more Additional Commitment Lenders. Each Additional Commitment Lender shall enter into an agreement with the Borrower and the Administrative Agent, in substantially the form attached as Exhibit B hereto, pursuant to which such Additional Commitment Lender shall, effective as of such Extension Effective Date (or, if such replacement occurs thereafter, as of the relevant effective date of such replacement), provide a new or additional Commitment hereunder, as applicable, in the amount specified therein and (if not then an existing Lender) become a Lender hereunder (and if such replacement shall be made after such Extension Effective Date, the Commitment Termination Date for such Commitment of such Additional Commitment Lender shall be the latest date to which the Commitments of the other Lenders was extended as of such Extension Effective Date).

(c) If (and only if) the total of the Commitments of the Lenders that have agreed in connection with any Extension Request to extend the Existing Commitment Termination Date and (if applicable) the additional Commitments of the Additional Commitment Lender(s) shall be at least 50% of the aggregate amount of the Commitments in effect immediately prior to the relevant Extension Effective Date, then, effective as of such Extension Effective Date, the Commitment Termination Date, but only with respect to the Commitment of each Lender that has agreed to so extend its Commitment and (if applicable) each Additional Commitment Lender that has replaced a Non-Extending Lender, shall be extended to the date that is one year after the then Existing Commitment Termination Date (or, if such date is not a Business Day, the immediately preceding Business Day) and (if not then an existing Lender) each Additional Commitment Lender shall thereupon become a “Lender” for all purposes of this Agreement; provided that the extension of the Existing Commitment Termination Date shall not be effective with respect to any Lender unless as of the relevant Extension Effective Date: (i) no Default shall have occurred and be continuing; (ii) the representations and warranties of the Borrower set forth in Article III shall be true and correct in all material respects on and as of the Existing Commitment Termination Date as if made on and as of such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date) and the Administrative Agent shall have received a certificate of a duly authorized officer of the Borrower certifying thereto and (iii) all amounts payable hereunder to any Non-Extending Lender that is being replaced by an Additional Commitment Lender in connection with such extension shall have been paid in full. Upon the effectiveness of such extension, the Administrative Agent shall record the relevant information in the Register and give prompt notice of such extension to the Borrower and the Lenders.

(d) Notwithstanding anything herein to the contrary, with respect to any Non-Extending Lender, the Commitment Termination Date for such Lender shall remain unchanged (and the Commitment of such Lender shall terminate, the Loans made by such Non-Extending Lender hereunder shall mature and be payable by the Borrower, and all other amounts owing to such Non-Extending Lender hereunder shall be payable, on such date).

32

ARTICLE III

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Lenders that:

SECTION 3.01. Organization; Powers. Each of the Borrower and its Material Subsidiaries is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.

SECTION 3.02. Authorization; Enforceability. The Transactions are within the Borrower’s corporate powers and have been duly authorized by all necessary corporate and, if required, by all necessary shareholder action. This Agreement has been duly executed and delivered by the Borrower and constitutes a legal, valid and binding obligation of the Borrower, enforceable in accordance with its terms, except as such enforceability may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or similar laws of general applicability affecting the enforcement of creditors’ rights and (b) the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, (b) will not violate any applicable law or regulation or the charter, by-laws or other organizational documents of the Borrower or any of its Subsidiaries or any order of any Governmental Authority, (c) will not violate or result in a default under any indenture, agreement or other instrument binding upon the Borrower or any of its Material Subsidiaries or assets, or give rise to a right thereunder to require any payment to be made by any such Person, and (d) will not result in the creation or imposition of any Lien on any asset of the Borrower or any of its Subsidiaries.

SECTION 3.04. Financial Condition, Etc.

(a) Financial Condition. The Borrower has heretofore furnished to the Lenders each of the following:

(i) its consolidated balance sheet and statements of income, stockholders equity and cash flows (a) as of and for the fiscal year ended December 31, 2008, reported on by PricewaterhouseCoopers LLP, independent public accountants, and (b) as of and for the fiscal quarter and the portion of the fiscal year ended March 31, 2009, certified by a senior financial officer of the Borrower. Such consolidated financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of the Borrower and its Consolidated Subsidiaries as of such date and for such period in accordance with

33

GAAP, subject to year-end adjustments and the absence of footnotes in the case of the statements referred to in clause (b) above;

(ii) the Statutory Statements for the year ended December 31, 2008 of each Insurance Company that is a Material Subsidiary and that is required by any Applicable Insurance Regulatory Authority to file such Statutory Statements, and such Statutory Statements have been prepared in accordance with statutory accounting practices and filed with the Applicable Insurance Regulatory Authorities, and present fairly, in all material respects, the financial condition of such Insurance Company as at said date and its results of operations for the fiscal year ended on said date in accordance with statutory accounting practices; and

(iii) consolidated balance sheets of each Material Subsidiary which is not an Insurance Company described in paragraph (ii) above and its Consolidated Subsidiaries as at December 31, 2008, and the related consolidated statements of income, stockholders’ equity and cash flows of such Material Subsidiary and its Consolidated Subsidiaries for its fiscal year ended on said date, and all such financial statements present fairly, in all material respects, the consolidated financial condition of such Material Subsidiary and its Consolidated Subsidiaries as at the applicable date and the consolidated results of their operations for the fiscal year ended on said date, all in accordance with GAAP and practices applied on a consistent basis.

(b) No Material Adverse Change. Since December 31, 2008, there has been no material adverse change in the business, assets, operations, prospects or condition (financial or otherwise) of the Borrower and its Subsidiaries, taken as a whole.

SECTION 3.05. Properties.

(a) Property Generally. Each of the Borrower and its Subsidiaries has good title to, or valid leasehold interests in, all its real and personal property material to its business, subject only to Liens permitted by Section 6.02 and except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes.

(b) Intellectual Property. Each of the Borrower and its Subsidiaries owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and other intellectual property material to its business, and the use thereof by the Borrower and its Subsidiaries does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.06. Litigation and Environmental Matters.

(a) Actions, Suits and Proceedings. There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority now pending against or, to the knowledge of the Borrower, threatened against or affecting the Borrower or any of its Subsidiaries (i) that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in

34

a Material Adverse Effect (other than the Disclosed Matters) or (ii) that involve this Agreement or the Transactions.

(b) Environmental Matters. Except for the Disclosed Matters and except with respect to any other matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, neither the Borrower nor any of its Subsidiaries (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.

(c) Disclosed Matters. Since the date of this Agreement, there has been no change in the status of the Disclosed Matters that, individually or in the aggregate, has resulted in, or materially increased the likelihood of, a Material Adverse Effect.

SECTION 3.07. Compliance with Laws and Agreements.

Each of the Borrower and its Subsidiaries is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.08. Investment and Holding Company Status. Neither the Borrower nor any of its Subsidiaries is (a) an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940 or (b) a “holding company” as defined in, or subject to regulation under, the Public Utility Holding Company Act of 1935.

SECTION 3.09. Taxes, Etc. The Borrower and its Subsidiaries have timely filed or caused to be filed all Federal income tax returns and all other material tax returns and reports required to have been filed and have paid or caused to be paid all taxes required to have been paid by it, except (a) taxes that are being contested in good faith by appropriate proceedings and for which such Person has set aside on its books adequate reserves or (b) to the extent that the failure to do so could not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect.

SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders all agreements, instruments and corporate or other restrictions to which it or any of its Subsidiaries is subject, and all other matters known to it, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. None of the reports, financial statements, certificates or other information furnished by or on behalf of the Borrower to the Lender in connection with the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the

35

circumstances under which they were made, not misleading as of the date made; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.

SECTION 3.12. Use of Credit. Neither the Borrower nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose, whether immediate, incidental or ultimate, of buying or carrying Margin Stock, and no part of the proceeds of any Loan hereunder will be used to buy or carry any Margin Stock.

SECTION 3.13. Indebtedness and Liens.

(a) Indebtedness. Part A of Schedule II is a list of all Material Indebtedness (other than Indebtedness created pursuant to this Agreement) of the Borrower and its Subsidiaries (other than FAC and Subsidiaries of FAC) on the Original Closing Date. Material Indebtedness of the Borrower and its Consolidated Subsidiaries (other than FAC and Subsidiaries of FAC) existing on the Original Closing Date does not exceed an aggregate principal or face amount of $750,000,000.

(b) Liens. Part B of Schedule II is a list of all Liens of the Borrower and its Subsidiaries (other than FAC and Subsidiaries of FAC) existing on the Original Closing Date, to the extent any such Lien secures Material Indebtedness. Liens of the Borrower and its Consolidated Subsidiaries (other than FAC and Subsidiaries of FAC) existing on the Original Closing Date and not set forth on Schedule II secure Indebtedness in an aggregate principal or face amount not exceeding $250,000,000.

ARTICLE IV

CONDITIONS

SECTION 4.01. Second Amended and Restated Effective Date. The effectiveness of this Agreement (and the amendment and restatement of the Existing Credit Agreement to be effected hereby) shall not become effective until the date on which the Borrower and the Administrative Agent, with the consent of the Required Lenders under the Existing Credit Agreement, shall have executed and delivered this Agreement (the “Second Amended and Restated Effective Date”).

The Administrative Agent shall notify the Borrower and the Lenders of the Second Amended and Restated Effective Date, and such notice shall be conclusive and binding.

SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing is subject to the satisfaction of the following conditions:

(a) the representations and warranties of the Borrower set forth in this Agreement shall be true and correct on and as of the date of such Borrowing (or, if any such representation or warranty is expressly stated to have been made as of a specified date, as of such specified date); and

36

(b) at the time of and immediately after giving effect to such Borrowing, no Default shall have occurred and be continuing.

Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in the preceding sentence.

ARTICLE V

AFFIRMATIVE COVENANTS

Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full, the Borrower covenants and agrees with the Lenders that:

SECTION 5.01. Financial Statements and Other Information. The Borrower will furnish to the Administrative Agent and each Lender:

(a) within 75 days after the end of each fiscal year of the Borrower (or such lesser number of days within which the Borrower shall be required to file its Annual Report on Form 10-K for such fiscal year with the SEC, without regard to any extension of the SEC’s filing requirements), the audited consolidated balance sheets and related statements of operations, stockholders’ equity and cash flows of the Borrower and its Subsidiaries as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by PricewaterhouseCoopers LLP or other independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;

(b) within 40 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower (or such lesser number of days within which the Borrower shall be required to file its Quarterly Report on Form 10-Q for such fiscal quarter with the SEC, without regard to any extension of the SEC’s filing requirements), the consolidated balance sheets and related statements of operations, stockholders’ equity and cash flows of the Borrower and its Subsidiaries as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for (or, in the case of the balance sheet, as of the end of) the corresponding period or periods of the previous fiscal year, all certified by a senior financial officer of the Borrower as presenting fairly in all material respects the financial condition and results of operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;

(c) concurrently with any delivery of financial statements under clause (k) or (l) of this Section, a certificate of a senior financial officer of the Borrower (i) certifying as

37

to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto and (ii) setting forth reasonably detailed calculations demonstrating compliance with Section 6.05;

(d) upon request of any Lender, a copy of any final financial examination report (including, without limitation, any report in respect of any tri-annual examination conducted by any Applicable Insurance Regulatory Authority) or market conduct examination report issued by or prepared for any Governmental Authority (including any Applicable Insurance Regulatory Authority) with respect to any Insurance Company that is a Material Subsidiary; and to the extent disclosure to the Lenders is permitted by law, a copy of any financial examination report issued by or prepared for any Governmental Authority (including any Applicable Bank Regulatory Authority) with respect to the Borrower, First American Trust or First Security Thrift;

(e) within 45 days after the end of each of the first three quarterly fiscal periods of each fiscal year of FATICO, Statutory Statements of FATICO (prepared in accordance with statutory accounting practices required or permitted by the Applicable Insurance Regulatory Authority) for such fiscal period, accompanied by a certificate of a senior financial officer of FATICO which certificate shall state that such financial statements present the financial condition of FATICO in accordance with statutory accounting practices required or permitted by the Applicable Insurance Regulatory Authority;

(f) within 90 days after the end of each fiscal year of FATICO, the annual Statutory Statement of FATICO (prepared in accordance with statutory accounting practices required or permitted by the Applicable Insurance Regulatory Authority) for such year and as filed with the Insurance Department of the State of California, accompanied by (i) a certificate of a senior financial officer of FATICO stating that said Statutory Statement presents the financial condition of FATICO in accordance with the statutory accounting practices required or permitted by the Applicable Insurance Regulatory Authority, (ii) a certificate of a senior financial officer of FATICO, affirming the adequacy of Reserves of FATICO as at the end of such fiscal year and (iii) a report by Milliman & Robertson, Inc., or such other actuarial firm of nationally recognized professional standing, affirming the adequacy of Reserves of FATICO as at the end of such fiscal year;

(g) within 75 days after the end of each fiscal year of FAC (or such lesser number of days within which FAC shall be required to file its Annual Report on Form 10-K for such fiscal year with the SEC, without regard to any extension of the SEC’s filing requirements), the audited consolidated balance sheets and related statements of operations, stockholders’ equity and cash flows of FAC and its Subsidiaries as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by PricewaterhouseCoopers LLP or other independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of FAC and its Subsidiaries on a consolidated basis in accordance with GAAP consistently

38

applied, provided, however, that after the closing of the FAC Transaction, the Borrower shall not be obligated to comply with this subsection;

(h) within 40 days after the end of each of the first three fiscal quarters of each fiscal year of FAC (or such lesser number of days within which FAC shall be required to file its Quarterly Report on Form 10-Q for such fiscal quarter with the SEC, without regard to any extension of the SEC’s filing requirements), the consolidated balance sheets and related statements of operations, stockholders’ equity and cash flows of FAC and its Subsidiaries as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for (or, in the case of the balance sheet, as of the end of) the corresponding period or periods of the previous fiscal year, all certified by a senior financial officer of FAC as presenting fairly in all material respects the financial condition and results of operations of FAC and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes, provided, however, that after the closing of the FAC Transaction, the Borrower shall not be obligated to comply with this subsection;

(i) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by the Borrower or any of its Subsidiaries with the Securities and Exchange Commission (the “SEC”), or any Governmental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange, or distributed by the Borrower to its shareholders generally, as the case may be, provided that if any such report, statement or other material is electronically filed by the Company with the SEC and is publicly available through the internet or other electronic means, the Company will notify the Lenders promptly following such filing and, only upon the request of any Lender, furnish a copy of such report, statement or other material to such Lender;

(j) promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of the Borrower or any of its Subsidiaries, or compliance with the terms of this Agreement, as the Administrative Agent or any Lender may reasonably request (including accountants’ letters);

(k) within 80 days after the end of each fiscal year of the Borrower (but in any event not later than five days after the delivery of the Borrower’s financial statements under clause (a) of this Section for such fiscal year), the audited consolidated balance sheets and related statements of operations, stockholders’ equity and cash flows of the Borrower and its Subsidiaries (excluding FAC and its Subsidiaries) as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by PricewaterhouseCoopers LLP or other independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Borrower and such Subsidiaries on a consolidated basis in accordance with GAAP consistently applied (and accompanied by a reasonably detailed statement of such accountants with respect to

39

the adjustments made as a result of the exclusion of FAC and its Subsidiaries from such financial statements); and

(l) within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower (but in any event not later than five days after the delivery of the Borrower’s financial statements under clause (b) of this Section for such fiscal quarter), the consolidated balance sheets and related statements of operations, stockholders’ equity and cash flows of the Borrower and its Subsidiaries (excluding FAC and its Subsidiaries) as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for (or, in the case of the balance sheet, as of the end of) the corresponding period or periods of the previous fiscal year, all certified by a senior financial officer of the Borrower as presenting fairly in all material respects the financial condition and results of operations of the Borrower and such Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes (and accompanied by a reasonably detailed statement of such senior financial officer with respect to the adjustments made as a result of the exclusion of FAC and its Subsidiaries from such financial statements).

SECTION 5.02. Notices of Material Events. The Borrower will furnish to the Administrative Agent and each Lender prompt written notice of the following:

(a) the occurrence of any Default;

(b) the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting the Borrower or any of its Affiliates that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect;

(c) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding $25,000,000;

(d) the assertion of any environmental matter by any Person against, or with respect to the activities of, the Borrower or any of its Subsidiaries and any alleged violation of or non-compliance with any Environmental Laws or any permits, licenses or authorizations, other than any environmental matter or alleged violation that, if adversely determined, would not (either individually or in the aggregate) have a Material Adverse Effect;

(e) immediately, notice of actual (or threatened action that could reasonably be expected to lead to the) suspension, termination or revocation of any License of any Insurance Company which is a Material Subsidiary by any Governmental Authority (including any Applicable Insurance Regulatory Authority), including any notice by any Governmental Authority of the commencement of any proceeding, hearing or administrative action to suspend, terminate or revoke any such License as a result of the failure by any such Insurance Company to take or refrain from taking, any action which

40

could reasonably be expected to materially adversely affect the authority of such Insurance Company to conduct its business after notice thereof by such Governmental Authority (including any such Applicable Insurance Regulatory Authority);

(f) promptly after the Borrower knows or has reason to believe that any insurance, banking or other regulator having jurisdiction over the Borrower or any of its Material Subsidiaries has commenced any proceeding, issued any order, given notice of a formal hearing, sought relief from any court or taken any similar action with respect to the Borrower or any of its Material Subsidiaries that seeks to, or would, result in the revocation of any license or authorization of the Borrower or any of its Material Subsidiaries or materially restrict the ability of the Borrower or any of its Material Subsidiaries to do business in any jurisdiction, a notice describing in reasonable detail such proceeding, order, hearing or similar action; and

(g) any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of a senior financial officer or other executive officer of the Borrower setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.

SECTION 5.03. Existence; Conduct of Business. The Borrower will, and will cause each of its Material Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges and franchises material to the conduct of its business; provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.03.

SECTION 5.04. Payment of Obligations. The Borrower will, and will cause each of its Material Subsidiaries to, pay its obligations, including Tax liabilities, that, if not paid, could result in a Material Adverse Effect before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect.

SECTION 5.05. Maintenance of Properties. The Borrower will, and will cause each of its Material Subsidiaries to, keep and maintain all property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted.

SECTION 5.06. Books and Records; Inspection Rights. The Borrower will, and will cause each of its Material Subsidiaries to, keep proper books of record and account in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities. The Borrower will, and will cause each of its Material Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender, upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and

41

records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested.

SECTION 5.07. Compliance with Laws and Agreements. The Borrower will, and will cause each of its Material Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

SECTION 5.08. Insurance. The Borrower will, and will cause each of its Subsidiaries to, keep insured by financially sound and reputable insurers all property of a character usually insured by corporations engaged in the same or similar business similarly situated against loss or damage of the kinds and in the amounts customarily insured against by such corporations and carry such other insurance as is usually carried by such corporations.

ARTICLE VI

NEGATIVE COVENANTS

Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees payable hereunder have been paid in full, the Borrower covenants and agrees with the Lenders that:

SECTION 6.01. Indebtedness. The Borrower will not permit any of its Subsidiaries to create, incur, assume or permit to exist any Indebtedness, except:

(a) Indebtedness outstanding on the Original Closing Date;

(b) Indebtedness of a Person that becomes a Subsidiary after the Original Closing Date, provided that (i) such Indebtedness was not incurred in connection with, or in contemplation of, such Person becoming a Subsidiary and (ii) the aggregate principal amount of Indebtedness permitted under this clause (b) shall not exceed $500,000,000 at any one time outstanding;

(c) Indebtedness of any Subsidiary of the Borrower to the Borrower or to any other Subsidiary of the Borrower;

(d) Arbitrage Loans;

(e) Indebtedness of FAREISI and FATICO to the Borrower representing intercompany loans made by the Borrower from net proceeds received by the Borrower from its Equity Issuances;

(f) additional Indebtedness of the Insurance Companies in respect of letters of credit (or similar instruments) and Guarantees issued in the ordinary course of the title insurance business, so long as the aggregate amount of all such Indebtedness does not exceed $50,000,000 at any one time outstanding;

42

(g) Indebtedness of Subsidiaries in respect of letters of credit (or similar instruments) and guarantees issued in connection with settlement or administration of claims made against any of its Subsidiaries under insurance policies of the type usually carried by corporations engaged in businesses or activities that are the same as or similar to those of the Borrower and its Subsidiaries;

(h) Indebtedness of any Subsidiary secured by a Lien upon real property and/or related fixtures and personal property including insurance and condemnation proceeds, if any, and assignment of leases and rents, with respect thereto (which Indebtedness may be guaranteed by the Borrower), provided that (i) the holder of such Indebtedness has recourse only to such real property (and/or such fixtures and other property) or (ii) the aggregate principal amount of Indebtedness permitted under this clause (h) shall not exceed $100,000,000 at any one time outstanding;

(i) additional Indebtedness of Subsidiaries not exceeding 20% of Total Stockholders’ Equity;

(j) obligations under Sale/Leaseback Transactions and Synthetic Leases permitted by Section 6.07;

(k) Indebtedness created, incurred or permitted to exist under the FAC Credit Agreement;

(l) so long as no Default has occurred and is continuing, other unsecured Indebtedness in an aggregate principal amount not to exceed $150,000,000 at any one time outstanding; and

(m) any extension, renewal or refinancing of the foregoing.

SECTION 6.02. Liens. The Borrower will not, nor will it permit any of its Subsidiaries to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof, except:

(a) Liens in existence on the Original Closing Date;

(b) Permitted Encumbrances;

(c) Liens upon property of any Person which becomes a Subsidiary of the Borrower after the Original Closing Date, provided that such Liens are in existence at the time such Person becomes a Subsidiary of the Borrower and were not created in anticipation thereof;

(d) Liens upon tangible personal property used primarily in the ordinary course of the business of the Borrower and its Subsidiaries and acquired after the Original Closing Date;

(e) Liens upon real property securing Indebtedness permitted by Section 6.01(h);

43

(f) Liens upon the property of First American Trust and First American Title & Trust Company which are created in the ordinary course of their respective financial services businesses as such businesses are conducted as of the Original Closing Date or as of the date hereof;

(g) Liens upon property of the Borrower or any Subsidiary which are created pursuant to real estate exchange transactions (benefiting from the tax treatment of Section 1031 of the Code) in the ordinary course of their respective financial services businesses as such businesses are conducted as of the Original Closing Date or as of the date hereof;

(h) Liens upon property of any Subsidiary of the Borrower securing Indebtedness of such Subsidiary to the Borrower or another Subsidiary of the Borrower that is the direct or indirect parent entity of such Subsidiary permitted by Section 6.01;

(i) Liens upon property of the Borrower or any of its Subsidiaries securing Arbitrage Loans; provided that no such Lien shall extend to or cover any such property other than the securities and/or other investments in which the proceeds of such Arbitrage Loans have been invested;

(j) Liens under Sale/Leaseback Transactions and Synthetic Leases permitted by Section 6.07; provided that no such Lien shall extend to or cover any property other than the property subject to such Sale/Leaseback Transactions and/or Synthetic Leases;

(k) Liens securing Indebtedness permitted by Section 6.01(k);

(l) so long as no Default has occurred and is continuing, other Liens securing obligations in an aggregate amount not to exceed $175,000,000 at any time outstanding; and

(m) any extension, renewal or replacement of the foregoing, provided that the Liens permitted under this clause (m) shall not be spread to cover any additional Indebtedness or obligations or property (other than a substitution of like property).

SECTION 6.03. Fundamental Changes.

(a) Mergers, Consolidations, Disposal of Assets, Etc. The Borrower will not, nor will it permit any of its Material Subsidiaries to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one transaction or in a series of transactions) all or substantially all of its assets, or all or substantially all of the stock of any of its Material Subsidiaries (in each case, whether now owned or hereafter acquired), or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing, (i) any Material Subsidiary may merge into the Borrower in a transaction in which the Borrower is the surviving corporation, (ii) any Material Subsidiary may merge into any Person in a transaction in which the surviving entity is a Subsidiary, (iii) any Material Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the Borrower or to another Subsidiary and (iv) the Borrower and/or any Subsidiary may engage in the FAC Transaction.

44

(b) Lines of Business. The Borrower will not, nor will it permit any of its Material Subsidiaries to, engage to any material extent in any business other than the businesses of the type conducted by the Borrower and its Material Subsidiaries on the date of execution of this Agreement and businesses reasonably related thereto.

SECTION 6.04. Transactions with Affiliates. The Borrower will not, nor will it permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except (a) transactions in the ordinary course of business at prices and on terms and conditions not less favorable to the Borrower or such Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties and (b) customary fees paid to members of the board of directors of the Borrower or any of its Subsidiaries.

Notwithstanding anything to the contrary herein, the Borrower and/or any of its Subsidiaries may engage in the FAC Transaction, provided, however, that prior to the consummation of the FAC Transaction, the Borrower will not, nor will it permit any of its Subsidiaries, to make any loan or advance to FAC or any Subsidiary of FAC or purchase or otherwise acquire any capital stock, assets, obligations or other securities of, make any capital contribution to, or invest in, or acquire any interest in, or to transfer assets (other than at fair market value for cash consideration) to, FAC or any Subsidiary of FAC, except (i) loans or advances, and agreements or commitments to make loans or advances, by the Borrower or any of its Subsidiaries to FAC or any Subsidiary of FAC outstanding or in effect on the date hereof not exceeding an aggregate amount of $30,000,000 and (ii) the Borrower and its Subsidiaries may implement the agreements and proposed transactions described or referred to in the preliminary proxy statement of FAC filed on June 30, 2005 with the SEC (including (x) a short-term line of credit by the Borrower or any of its Subsidiaries to FAC for working capital purposes in the amount of approximately $45,000,000 and (y) the services to be provided by the Borrower or any of its Subsidiaries to FAC or any Subsidiary of FAC in connection with such agreements and proposed transactions and all fees and expenses payable by FAC and its Subsidiaries for such services).

SECTION 6.05. Financial Covenants.

(a) Total Stockholders’ Equity. The Borrower will not permit Total Stockholders’ Equity (i) at any time prior to December 31, 2007, to be less than the sum of (x) $1,000,000,000 plus (y) 100% of the net cash proceeds from the issuance of any capital stock of the Borrower or any of its Consolidated Subsidiaries after the date hereof (excluding any proceeds received from the exercise of stock options held by officers, directors, employees, or consultants of the Borrower or any of its Subsidiaries), (ii) at any time thereafter and prior to December 31, 2008, to be less than the sum of (x) $1,500,000,000 plus (y) 100% of the net cash proceeds from the issuance of any capital stock of the Borrower or any of its Consolidated Subsidiaries on or following the Amendment No. 1 and Waiver Effective Date (excluding any proceeds received from the exercise of stock options held by officers, directors, employees, or consultants of the Borrower or any of its Subsidiaries) and (iii) at any time thereafter, to be less than the sum of (x) $2,000,000,000 plus (y) 100% of the net cash proceeds from the issuance of any capital stock of the Borrower or any of its Consolidated Subsidiaries on or following the

45

Amendment No. 1 and Waiver Effective Date (excluding any proceeds received from the exercise of stock options held by officers, directors, employees, or consultants of the Borrower or any of its Subsidiaries).

(b) Total Debt to Total Capitalization. The Borrower will not permit Total Debt at any time to exceed 40% of Total Capitalization.

(c) Combined Earnings. The Borrower will not permit Combined Earnings for any period of eight consecutive rolling fiscal quarters to be less than $225,000,000 at any time.

(d) Aggregate Funded Debt. The Borrower will not permit the aggregate amount of Funded Debt of all of its Subsidiaries at any time to exceed 25% of Total Stockholders’ Equity.

SECTION 6.06. Foreclosure on Subject Property. The Borrower will not, nor will it permit any of its Subsidiaries to, acquire ownership or control of any commercial real property with a fair market value of $2,000,000 or more and which is used for commercial purposes by means of the exercise of any right of foreclosure, power of sale or similar remedy it may avail itself of by way of any indenture of mortgage or similar instrument relating to such commercial real property (the “Subject Property”), or accept a deed to the Subject Property in lieu of foreclosure or in settlement of any title insurance claim against it, unless the Borrower shall have theretofore caused a Phase I Environmental Review (as defined below) with respect to the Subject Property to be conducted. The Borrower agrees to provide to any Lender a copy of such Environmental Review within 60 days of any request by such Lender therefor. As used herein, “Phase I Environmental Review” means an environmental survey and assessment prepared by an independent engineer selected by the Borrower expert in the identification and analysis of environmental risks (such engineer and his agents being referred to as the “Environmental Consultant”), such survey and assessment to (a) estimate current liabilities and assess potential sources of future liabilities of any owner or operator of, or any other Person having control of, the Subject Property arising under the Comprehensive Response, Compensation and Liability Act, the Superfund Amendments and Reauthorization Act of 1986, the Resource Conservation and Recovery Act, in each case as amended, and any other act or regulation of any Federal, state or local environmental authority having authority in respect of the Subject Property and (b) be based upon (i) a physical on-site inspection by the Environmental Consultant of the Subject Property (without any excavation of the Subject Property), (ii) interviews by the Environmental Consultant of individuals who have direct managerial responsibility for operations on the Subject Property, (iii) a review by the Environmental Consultant of records relating to current and historical operations conducted at the Subject Property and (iv) as deemed appropriate by the Environmental Consultant, interviews by the Environmental Consultant of individuals in the area in which the Subject Property is located who may have knowledge of current and historical operations conducted at the Subject Property.

SECTION 6.07. Sale/Leaseback Transactions and Synthetic Leases. The Borrower will not, nor will it permit any of its Subsidiaries to, enter into any Sale/Leaseback Transaction or Synthetic Lease, if, as a result thereof, the aggregate amount of rent and lease payments payable in any fiscal year by the Borrower and its Subsidiaries under all such arrangements would exceed $50,000,000.

46

ARTICLE VII

EVENTS OF DEFAULT

If any of the following events (“Events of Default”) shall occur:

(a) the Borrower shall fail to pay any principal of any Loan when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;

(b) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under this Agreement, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three or more Business Days;

(c) any representation or warranty made or deemed made by or on behalf of the Borrower in or in connection with this Agreement or any amendment or modification hereof, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement or any amendment or modification hereof, shall prove to have been incorrect in any material respect when made or deemed made;

(d) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 5.02(a), Section 5.02(g) or in Article VI (other than Section 6.07);

(e) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in this Agreement (other than those specified in clause (a), (b) or (d) of this Article) and such failure shall continue unremedied for a period of 30 or more days after notice thereof from the Administrative Agent (given at the request of any Lender) to the Borrower;

(f) the Borrower or any of its Subsidiaries shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness, when and as the same shall become due and payable (beyond any applicable grace period expressly set forth in the governing documents); or any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (after taking into account any applicable grace period) the holder or holders of any such Material Indebtedness or any trustee or agent on its or their behalf to cause such Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity;

(g) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any of its Subsidiaries or its debts, or of a substantial part of its assets, under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator,

47

conservator or similar official for the Borrower or any of its Subsidiaries or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for a period of 60 or more days or an order or decree approving or ordering any of the foregoing shall be entered;

(h) the Borrower or any of its Subsidiaries shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (g) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any of its Subsidiaries or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

(i) the Borrower or any of its Subsidiaries shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;

(j) one or more judgments for the payment of money in an aggregate amount in excess of $50,000,000 shall be rendered against the Borrower or any of its Subsidiaries or any combination thereof and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Borrower or any of its Subsidiaries to enforce any such judgment;

(k) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when taken together with all other ERISA Events that have occurred, could reasonably be expected to result in a Material Adverse Effect;

(l) a reasonable basis shall exist for the assertion against the Borrower or any of its Subsidiaries, or any predecessor in interest of the Borrower or any of its Subsidiaries, of (or there shall have been asserted against the Borrower or any of its Subsidiaries) any claims or liabilities, whether accrued, absolute or contingent, based on or arising from the generation, storage, transport, handling or disposal of Hazardous Materials by the Borrower or any of its Subsidiaries or predecessors that, in the judgment of the Required Lenders, are reasonably likely to be determined adversely to the Borrower or any of its Subsidiaries, and the amount thereof (either individually or in the aggregate) is reasonably likely to have a Material Adverse Effect (insofar as such amount is payable by the Borrower or any of its Subsidiaries but after deducting any portion thereof that is reasonably expected to be paid by other creditworthy Persons jointly and severally liable therefor);

(m) a Change of Control shall occur; or

48

(n) the Borrower or any of its Material Subsidiaries shall be required by any Applicable Bank Regulatory Authority, any Applicable Insurance Regulatory Authority or any other similar governmental regulatory authority to enter into, after the date hereof, any indenture, agreement, instrument or other arrangement (including, without limitation, any capital maintenance agreement) that, (x) directly or indirectly, prohibits or restrains, or has the effect of prohibiting or restraining, or imposes materially adverse conditions upon, the incurrence or payment of Indebtedness, the granting of Liens, the declaration or payment of dividends, the making of loans or advances or the sale, assignment, transfer or other disposition of property or (y) requires the making of capital contributions to any Subsidiary in an aggregate amount exceeding $100,000,000;

then, and in every such event (other than an event with respect to the Borrower described in clause (g) or (h) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take either or both of the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, and (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; and in case of any event with respect to the Borrower described in clause (g) or (h) of this Article, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.

ARTICLE VIII

THE ADMINISTRATIVE AGENT

Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof, together with such actions and powers as are reasonably incidental thereto.

The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and such Person and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if it were not the Administrative Agent hereunder.

The Administrative Agent shall not have any duties or obligations except those expressly set forth herein. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have

49

any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby that the Administrative Agent is required to exercise in writing by the Required Lenders and (c) except as expressly set forth herein, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders or in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement, (ii) the contents of any certificate, report or other document delivered hereunder or in connection herewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall not incur any liability for relying thereon. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.

The Administrative Agent may resign at any time by notifying the Lenders and the Borrower. Upon any such resignation, the Required Lenders shall have the right, in consultation with the Borrower, to appoint a successor. If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent’s resignation shall nonetheless become effective and (1) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and (2) the Required Lenders shall perform the duties of the Administrative Agent (and all payments and

50

communications provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender directly) until such time as the Required Lenders appoint a successor agent as provided for above in this paragraph. Upon the acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent and the retiring Administrative Agent shall be discharged from its duties and obligations hereunder (if not already discharged therefrom as provided above in this paragraph). The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the Administrative Agent’s resignation hereunder, the provisions of this Article and Section 9.03 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Administrative Agent.

Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any related agreement or any document furnished hereunder or thereunder.

Notwithstanding anything to the contrary contained herein, the Sole Lead Arranger and Sole Bookrunner and the Syndication Agents named on the cover page of this Agreement shall not have any duties or liabilities under this Agreement, except in their capacity, if any, as Lenders.

ARTICLE IX

MISCELLANEOUS

SECTION 9.01. Notices. Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:

(a) if to the Borrower, to it at The First American Corporation, 1 First American Way, Santa Ana, California 92707, Attention of Chief Financial Officer (Telecopier No.: (714) 250-3325; Telephone No.: (714) 250-3000);

(b) if to the Administrative Agent, to JPMorgan Chase Bank, N.A., 1111 Fannin Street, 10^th Floor, Houston, Texas 77002-8069, Attention of Eleanor Fiore, Loan and Agency Services (Telephone No. (713) 750-3523; Telecopy No. (713) 750-2223), JPMorgan Chase Bank, N.A., 270 Park Avenue, New York 10017, Attention of Mark Cisz (Telecopy No. (212) 270-1511; Telephone No. (212) 270-6055); and

51

(c) if to a Lender, to it at its address (or telecopy number) set forth in its Administrative Questionnaire.

Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto (or, in the case of any such change by a Lender, by notice to the Borrower and the Administrative Agent). All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt.

Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communications pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article II unless otherwise agreed by the Administrative Agent and the applicable Lender. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

SECTION 9.02. Waivers; Amendments.

(a) No Deemed Waivers; Remedies Cumulative. No failure or delay by the Administrative Agent or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default at the time.

(b) Amendments. Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected thereby, (iii) postpone the scheduled date of payment of the principal amount of any Loan, or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender affected thereby, (iv) alter the manner in which payments or prepayments of principal, interest or other amounts hereunder shall be applied as among the Lenders or Types of Loans, without the written consent of each Lender, or (v) change any of the provisions of this Section or the definition of the term “Required Lenders” or any other provision hereof specifying the number or

52

percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender; and provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent hereunder without the prior written consent of the Administrative Agent.

SECTION 9.03. Expenses; Indemnity; Damage Waiver.

(a) Costs and Expenses. The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent, in connection with the syndication of the credit facilities provided for herein, the preparation and administration of this Agreement or any amendments, modifications or waivers of the provisions hereof (whether or not the transactions contemplated hereby or thereby shall be consummated) and (ii) all out-of-pocket expenses incurred by the Administrative Agent or any Lender, including the fees, charges and disbursements of any counsel for the Administrative Agent, or any Lender, in connection with the enforcement or protection of its rights in connection with this Agreement, including its rights under this Section, or in connection with the Loans made hereunder, including in connection with any workout, restructuring or negotiations in respect thereof.

(b) Indemnification by the Borrower. The Borrower shall indemnify the Administrative Agent and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including the fees, charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement or any agreement or instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any Loan or the use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee.

(c) Reimbursement by Lenders. To the extent that the Borrower fails to pay any amount required to be paid by it to the Administrative Agent under paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the Administrative Agent such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent in its capacity as such.

53

(d) Waiver of Consequential Damages, Etc. To the extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the Transactions, any Loan or the use of the proceeds thereof.

(e) Payments. All amounts due under this Section shall be payable promptly after written demand therefor.

SECTION 9.04. Successors and Assigns.

(a) Assignments Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b) Assignments by Lenders. Any Lender may assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it); provided that (i) except in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, each of the Borrower and the Administrative Agent must give their prior written consent to such assignment (which consent shall not be unreasonably withheld or delayed), (ii) except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender’s Commitment, the amount of the Commitment of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000 unless each of the Borrower and the Administrative Agent otherwise consent (which consent shall not be unreasonably withheld or delayed), (iii) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement, (iv) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500, and (v) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire; provided further that any consent of the Borrower otherwise required under this paragraph shall not be required if an Event of Default under clause (a), (b), (g) or (h) of Article VII has occurred and is continuing. Upon acceptance and recording pursuant to paragraph (d) of this Section, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights

54

and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.12, 2.13, 2.14 and 9.03). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (e) of this Section.

Notwithstanding anything to the contrary contained herein, any Lender (a “Granting Lender”) may grant to a special purpose vehicle (an “SPV”) of, or administered by, such Granting Lender, identified as such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower, the option to provide to the Borrower all or any part of any Loan that such Granting Lender would otherwise be obligated to make to the Borrower pursuant to Section 2.01, provided that (i) nothing herein shall constitute a commitment by any SPV to make any Loan, (ii) if an SPV elects not to exercise such option or otherwise fails to timely provide all or any part of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof and (iii) the Borrower may bring any proceeding against either or both of the Granting Lender and the SPV in order to enforce any rights of the Borrower hereunder. The making of a Loan by an SPV hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Loan were made by the Granting Lender. Each party hereto hereby agrees that nothing contained in this paragraph shall relieve any Granting Lender of its obligations under this Agreement and that no SPV shall be liable for any payment under this Agreement for which a Lender would otherwise be liable, for so long as, and to the extent, the related Granting Lender makes such payment in accordance with the terms of this Agreement. In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other senior indebtedness of any SPV, it will not institute against, or join any other person in instituting against, such SPV any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or similar proceedings under the laws of the United States or any State thereof arising out of any claim against such SPV under this Agreement. In addition, notwithstanding anything to the contrary contained in this Section, any SPV may with notice to, but without the prior written consent of, the Borrower or the Administrative Agent and without paying any processing fee therefor, assign all or a portion of its interests in any Loans to its Granting Lender or to any financial institutions (consented to by the Borrower and the Administrative Agent, which consents shall not be unreasonably withheld) providing liquidity and/or credit support (if any) with respect to commercial paper issued by such SPV to fund such Loans and such SPV may disclose, on a confidential basis in accordance with Section 9.12, confidential information with respect to the Borrower and its Subsidiaries to any rating agency, commercial paper dealer or provider of a surety, guarantee or credit liquidity enhancement to such SPV. Each Granting Lender shall provide the Borrower with notice of each grant made by it under this paragraph to an SPV. Except for its obligation to make payments directly to an SPV in respect of any Loan (or any part thereof) made by such SPV, the Borrower shall continue to deal solely and directly with the Granting Lender. This paragraph may not be amended without the consent of any SPV at the time holding Loans under this Agreement.

(c) Maintenance of Register by the Administrative Agent. The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices in New York City a copy of each Assignment and Assumption delivered to it and a register for the

55

recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

(d) Effectiveness of Assignments. Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.

(e) Participations. Any Lender may, without the consent of the Borrower or the Administrative Agent, sell participations to one or more banks or other entities (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects such Participant. Subject to paragraph (f) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section.

(f) Limitations on Rights of Participants. A Participant shall not be entitled to receive any greater payment under Section 2.12 or 2.14 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.14 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.14(e) as though it were a Lender.

(g) Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any such pledge or assignment to a Federal Reserve Bank, and this Section

56

shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such assignee for such Lender as a party hereto.

(h) No Assignments to the Borrower or Affiliates. Anything in this Section to the contrary notwithstanding, no Lender may assign or participate any interest in any Loan held by it hereunder to the Borrower or any of its Affiliates or Subsidiaries without the prior consent of each Lender.

SECTION 9.05. Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as the Commitments have not expired or terminated. The provisions of Sections 2.12, 2.13, 2.14 and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Commitments or the termination of this Agreement or any provision hereof.

SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract between and among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Delivery of an executed counterpart of a signature page to this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

SECTION 9.07. Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or

57

demand, provisional or final) at any time held and other indebtedness at any time owing by such Lender to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter existing under this Agreement held by such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.

SECTION 9.09. Governing Law; Jurisdiction; Etc.

(a) Governing Law. This Agreement shall be construed in accordance with and governed by the law of the State of New York.

(b) Submission to Jurisdiction. The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Administrative Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement against the Borrower or its properties in the courts of any jurisdiction.

(c) Waiver of Venue. The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(d) Service of Process. Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER

58

AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

SECTION 9.11. Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

SECTION 9.12. Treatment of Certain Information; Confidentiality.

(a) Treatment of Certain Information. The Borrower acknowledges that from time to time financial advisory, investment banking and other services may be offered or provided to the Borrower or one or more of its Subsidiaries (in connection with this Agreement or otherwise) by any Lender or by one or more subsidiaries or affiliates of such Lender and the Borrower hereby authorizes each Lender to share any information delivered to such Lender by the Borrower and its Subsidiaries pursuant to this Agreement, or in connection with the decision of such Lender to enter into this Agreement, to any such subsidiary or affiliate, it being understood that any such subsidiary or affiliate receiving such information shall be bound by the provisions of paragraph (b) of this Section as if it were a Lender hereunder. Such authorization shall survive the repayment of the Loans, the expiration or termination of the Commitments or the termination of this Agreement or any provision hereof.

(b) Confidentiality. Each of the Administrative Agent, the Lenders and each SPV agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (i) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (ii) to the extent requested by any regulatory authority, (iii) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (iv) to any other party to this Agreement, (v) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder, (vi) subject to an agreement in writing containing provisions substantially the same as those of this paragraph and for the benefit of the Borrower, to (a) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (b) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (vii) with the consent of the Borrower or (viii) to the extent such Information (A) becomes publicly available other than as a result of a breach of this paragraph or (B) becomes available to the Administrative Agent or any Lender on a nonconfidential basis from a source other than the Borrower For the purposes of this paragraph, “Information” means all information received from the Borrower relating to the Borrower, its Subsidiaries or their business, other than any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by the Borrower; provided that, in the case of information received from the Borrower after the date hereof, such information is clearly identified at or prior to the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the

59

confidentiality of such Information as such Person would accord to its own confidential information.

SECTION 9.13. USA PATRIOT Act. Each Lender hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), such Lender may be required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with said Act.

SECTION 9.14. Effect of Second Amended and Restated Credit Agreement. Upon the execution and delivery hereof by the Borrower and the Administrative Agent, with the consent of the Required Lenders under the Existing Credit Agreement, this Agreement shall amend, and restate as amended, the Existing Credit Agreement, but shall not constitute a novation thereof or in any way impair or otherwise affect the rights or obligations of the parties thereunder (including with respect to Loans and representations and warranties made thereunder) except as such rights or obligations are amended or modified hereby. The Existing Credit Agreement as amended and restated hereby shall be deemed to be a continuing agreement among the parties, and all documents, instruments and agreements delivered pursuant to or in connection with the Existing Credit Agreement not amended and restated in connection with the entry of the parties into this Agreement shall remain in full force and effect, each in accordance with its terms, as of the date of delivery or such other date as contemplated by such document, instrument or agreement to the same extent as if the modifications to the Existing Credit Agreement contained herein were set forth in an amendment to the Existing Credit Agreement in a customary form, unless such document, instrument or agreement has otherwise been terminated or has expired in accordance with or pursuant to the terms of this Agreement, the Existing Credit Agreement or such document, instrument or agreement or as otherwise agreed by the required parties hereto or thereto. All Lenders parties to the Existing Credit Agreement, as set forth on Schedule I hereto, shall continue as parties to and Lenders under this Agreement.

60

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.

THE FIRST AMERICAN CORPORATION
By	/s/ Anthony S. Piszel
Name:	Anthony S. Piszel
Title:	Chief Financial Officer
By	/s/ Max O. Valdes
Name:	Max O. Valdes
Title:	Senior Vice President and Chief Accounting Officer
U.S. Federal Tax Identification No.: 95-1068610
JPMORGAN CHASE BANK, N.A., individually and as Administrative Agent
By	/s/ Mark M. Cisz
Name:	Mark M. Cisz
Title:	Executive Director

61

EXHIBIT A

[Form of Assignment and Assumption]

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including any letters of credit, guarantees, and swingline loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.

1. Assignor:
2. Assignee:		[and is an Affiliate/Approved Fund of [identify Lender]1]
3. Borrower(s):	The First American Corporation
4. Administrative Agent:	JPMorgan Chase Bank, N.A., as the administrative agent under the Credit Agreement

¹ Select as applicable.

5. Credit Agreement:	The $500,000,000 Second Amended and Restated Credit Agreement dated as of June [    ], 2009 among The First American Corporation, the Lenders parties thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent
6: Assigned Interest:

Aggregate Amount of Commitment/Loans for all Lenders	Amount of Commitment/Loans Assigned	Percentage Assigned of Commitment/Loans2
$	$	$
$	$	$
$	$	$

Effective Date:             ,         20     [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

The terms set forth in this Assignment and Assumption are hereby agreed to:

ASSIGNOR

[NAME OF ASSIGNOR]

By:

Title:

ASSIGNEE

[NAME OF ASSIGNEE]

By:

Title:

² Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

2

[Consented to and]³ Accepted:

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

By

Title:

[Consented to:]⁴

THE FIRST AMERICAN CORPORATION

By

Title:

³ To be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement.

⁴ To be added only if the consent of the Borrower is required by the terms of the Credit Agreement.

3

ANNEX 1

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement or any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of the Credit Agreement or (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under the Credit Agreement.

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, and (v) if it is a Foreign Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender.

2. Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

3. General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.

2

EXHIBIT B

[Form of Additional Commitment Agreement]

ADDITIONAL COMMITMENT AGREEMENT

            , 200    ,

The First American Corporation

1 First American Way

Santa Ana, CA 92707

Attention: [                    ]

JPMorgan Chase Bank, N.A.

  as Administrative Agent

270 Park Avenue

New York, New York 10017

Attention: Loan and Agency Services Group

Ladies and Gentlemen:

Reference is made to the Second Amended and Restated Credit Agreement, dated as of June [    ], 2009 (as amended and in effect from time to time, the “Credit Agreement”), among The First American Corporation, the Lenders named therein and JPMorgan Chase Bank, N.A. as Administrative Agent for the Lenders. Terms defined in the Credit Agreement are used herein with the same meanings.

By the execution and delivery of this Agreement, which is being entered into pursuant to Section 2.17(b) of the Credit Agreement, each of the Persons listed below under the caption “ADDITIONAL COMMITMENT LENDER(S)” (each an “Additional Commitment Lender”) agrees as follows:

1. The effective date of this Agreement is [            ] (the “Effective Date”).

2. If, immediately prior to the execution and delivery of this Agreement, such Person is a Lender party to the Credit Agreement, such Person hereby agrees that, effective as of the Effective Date, it shall provide an additional Commitment under the Credit Agreement in the amount set forth opposite its name under Part A of Schedule I hereto under the caption “Additional Commitment” (which Commitment shall be in addition to such Person’s existing Commitment under the Credit Agreement).

3. If, immediately prior to the execution and delivery of this Agreement, such Person is not a Lender party to the Credit Agreement, such Person hereby agrees that, effective as of the Effective Date, (i) it shall have a Commitment in an amount equal to the amount set forth opposite its name under Part B of Schedule I hereto under the

caption “Commitment” and (ii) agrees with the Borrower and the Administrative Agent that, from and after the Effective Date, such Person shall be a Lender party to and be bound by the provisions of the Credit Agreement and shall have all of the rights and obligations of a Lender under the Credit Agreement in respect of such Commitment.

4. The Commitment Termination Date in respect of such Person’s Commitment covered by this Agreement is [            ].⁵

This Agreement shall be construed in accordance with and governed by the law of the State of New York. This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.

This Agreement shall become effective as of the Effective Date upon the execution and delivery of this Agreement by each Additional Commitment Lender, the Borrower and the Administrative Agent and receipt by the Administrative Agent of counterparts hereof executed by each such party.

ADDITIONAL COMMITMENT LENDER(S)
[NAME OF LENDER]
By
	Name:
	Title:

⁵ Should be completed to provide the updated Commitment Termination Date pursuant to the extension request.

2

CONSENTED TO:
THE FIRST AMERICAN CORPORATION
By
	Name:
	Title:
JPMORGAN CHASE BANK, N.A., as Administrative Agent
By
	Name:
	Title:

Schedule I

Part A: Existing Lenders:
Name	Additional Commitment
Part B: New Lenders:
Name	Commitment ($)

SCHEDULE I

LENDERS COMMITMENT SCHEDULE

Lenders	Commitment
Bank of America, N.A.	$	75,000,000
JPMorgan Chase Bank, N.A.	$	65,000,000
Comerica Bank	$	60,000,000
Union Bank of California, N.A.	$	60,000,000
US Bank	$	60,000,000
Wells Fargo Bank, National Association	$	60,000,000
Bank of the West	$	45,000,000
Keybank National Association	$	45,000,000
HSBC Bank USA, National Association	$	30,000,000
		Total Commitments
	$	500,000,000

EX-10.(GGGG)

Exhibit (10)(gggg)

CONFIDENTIAL CONFIDENTIAL

SEPARATION AGREEMENT AND GENERAL RELEASE

This Separation Agreement and General Release (this “Agreement”), dated as of January 13, 2010, is entered into by and between Frank V. McMahon (“McMahon”) and The First American Corporation (“First American” or the “Company”; First American and McMahon, each a “Party” and, collectively, the “Parties”), and is intended by the Parties to conclude any and all issues arising out of or regarding McMahon’s employment with First American and any of its affiliates.

R E C I T A L S :

WHEREAS, McMahon and First American are parties to (a) a letter agreement, dated February 21, 2006, outlining the terms of his employment (the “Employment Agreement”); (b) a Stock Option Award Agreement, dated as of March 31, 2006 (“Hire Option Agreement”), evidencing an option granted to McMahon in connection with the commencement of his employment by First American (the “Initial Option”), (c) a Restricted Stock Award Agreement, dated as of March 31, 2006 (“Hire RSA Agreement”), evidencing restricted stock granted to McMahon in connection with the commencement of his employment (the “Initial RSA”), (d) a letter agreement, dated March 26, 2007, regarding equity awards granted to McMahon in connection with his service as a director of First Advantage Corporation (“FADV Equity Agreement”) and (e) various restricted stock unit award agreements (including the notice of restricted stock unit grant provided in connection therewith) governing “Bonus Restricted Stock Units” (“Bonus RSUs”) and “Other Restricted Stock Units” (which are also known as “LTI Restricted Stock Units” or “LTI RSUs” and are referred to herein as “Other RSUs”) granted to McMahon since March 31, 2006 (the “RSU Agreements”).

WHEREAS, the Parties now mutually desire to terminate their employment relationship and the Employment Agreement on the terms set forth herein.

A G R E E M E N T :

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound, the Parties agree as follows:

1. Termination of Employment. McMahon’s employment was terminated on November 30, 2009 (“Separation Date”). First American acknowledges and agrees that for purposes of First American’s benefit plans, the Hire Option Agreement, the Hire RSA Agreement and the RSU Agreements, McMahon was terminated “without cause”. McMahon acknowledges and agrees that he received a final check for his wages through the Separation Date, which included a payout of all accrued but unused PTO as of the Separation Date. The

CONFIDENTIAL CONFIDENTIAL

Employment Agreement is deemed fully terminated and of no further force or effect on and after the Separation Date. The Parties expressly waive any notice provision or requirement, if any, contained in the Employment Agreement regarding termination.

2. Separation Payment. On the Effective Date (as defined below), First American will pay McMahon, less required deductions and withholdings, the following amounts, in cash, by wire transfer (pursuant to such instructions as McMahon shall provide):

(a) $3,309,305.00, as severance pay (“Severance Pay”) and

(b) $2,040,500.00, as incentive compensation for the 2009 calendar year, which McMahon acknowledges is at 106% of his bonus target for such year.

McMahon acknowledges and agrees that the Severance Pay is paid in consideration of the covenants made by McMahon set forth in this Agreement, including, without limitation, the covenants set forth in Sections 7(a), (b), (c) and (d) of this Agreement, which covenants are intended to survive the termination of the Employment Agreement.

In addition, First American will reimburse McMahon for all reasonable outstanding business-related expenses incurred by him prior to the Separation Date, subject to the Company’s policies relating to business-related expenses and submission of an itemized expense report reasonably satisfactory to the Company.

3. Equity Awards.

(a) First American and McMahon acknowledge and agree that (a) the Initial Option shall vest and be exercisable in accordance with the terms of the Hire Option Agreement, (b) the Initial RSA shall vest in accordance with the terms of the Hire RSA Agreement, (c) Bonus RSUs and Other RSUs shall vest in accordance with the terms of the RSU Agreements.

(b) McMahon and First American acknowledge and agree that (a) in accordance with the terms of the Hire Option Agreement, the Initial Option vested in full on November 30, 2009 and remains exercisable under the terms of the Hire Option Agreement until March 31, 2016, (b) the Initial RSA vested in full on November 30, 2009, (c) Bonus RSUs shall continue to accrue dividends (to the extent such dividends are declared and paid) and shall vest on November 30, 2010, provided McMahon complies (and has complied since November 30, 2009) with the terms of the RSU Agreements and Sections 7(a), (b), (c) and (d) of this Agreement through such date and (d) Other RSUs shall terminate and be forfeited, with the exception of the Other RSUs granted to McMahon in 2007 (of which 9,538 remain outstanding), which shall continue to accrue dividends (to the extent such dividends are declared and paid) and vest on November 30, 2010, provided McMahon complies (and has complied since November 30, 2009) with the terms of the RSU Agreements and Sections 7(a), (b), (c) and (d) of this Agreement through such date.

(c) Upon the consummation of the previously announced separation of the Company’s information solutions group (“ISG”) from its financial services group (the “Spin-Off”), the Initial Option shall convert into an option to purchase stock in the entity comprised of

-2-

CONFIDENTIAL CONFIDENTIAL

the ISG (“Remainco”) and the number of shares subject to the Initial Option and the exercise price with respect thereof shall be adjusted in the same manner as options held by employees of the ISG at the time of the Spin-Off. McMahon acknowledges that as a result of such conversion he will not receive any interest in the Financial Services Company (as defined below) in connection with his Initial Option, any Bonus RSUs and any Other RSUs. Any Bonus RSUs and Other RSUs which remain outstanding on the date of the Spin-Off shall be converted into Bonus RSUs and Other RSUs of Remainco on the same terms applicable to employees of ISG at the time of the separation. McMahon acknowledges that Remainco currently does not intend to pay dividends and, consequently, following the conversion described immediately above in this Section 3(c), Bonus RSUs and the Other RSUs granted McMahon in 2007 may cease to accrue dividends. In the event of a “Change of Control” (as defined in The First American Corporation 2006 Incentive Compensation Plan) of the Company, the Company agrees that it will use commercially reasonable efforts to cause all or any portion of the Initial Option remaining unexercised and outstanding at such time to be treated in the same manner as options held by Company employees.

4. Deferred Compensation; Key Employee. As a participant in First American’s Deferred Compensation Plan, McMahon will be eligible to receive payments according to the terms of that plan. McMahon understands that he may be considered a “key” employee pursuant to Internal Revenue Code Section 409A, which generally provides that nonqualified deferred compensation payments upon separation from service, other than due to death, to “specified employees” of public companies cannot be made earlier than six months after the Separation Date and that any payment made to McMahon under any retirement or other benefit may be delayed as provided in such plan.

5. Health Insurance Benefits. McMahon’s health insurance benefits will continue through his Separation Date, after which it will be necessary for him to convert or continue such plans and coverage at his sole option, cost and expense. First American’s benefit administrator will provide McMahon with the notice and election forms required by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and any applicable state law.

6. Other Benefits. First American shall not be obligated to provide or reimburse McMahon for any compensation, salary, profit sharing, stock options, bonuses, insurance, allowances (including automobile), benefits (including medical, dental, life and disability), vacation, perquisites or expenses after the Separation Date, other than as specifically provided by this Agreement. If First American (or the entity comprised of ISG following the Spin-Off) purchases directors and officers insurance, First American (or such entity) shall provide McMahon coverage under such policy for acts or omissions of McMahon while an employee of First American to the same extent as that provided other former employees of First American as of November 30, 2009. First American further agrees to refrain from ceasing to provide McMahon with coverage under First American’s directors and officers insurance policy, as such policy was in effect on November 30, 2009, except to the extent First American ceases to provide coverage to all similarly situated employees of First American as of such date.

7. Post-Separation Covenants

-3-

CONFIDENTIAL CONFIDENTIAL

(a) Detrimental Activity. Until November 30, 2011, McMahon agrees to refrain from engaging in any Detrimental Activity (as defined below). For purposes of this Agreement, “Detrimental Activity” means at any time (i) using information received during employment with the Company and/or its affiliates relating to the business affairs of the Company or any such affiliates in breach of an express or implied undertaking to keep such information confidential; (ii) directly or indirectly persuading or attempting to persuade, by any means, any employee of the Company or any of its affiliates to breach any of the terms of his or her employment with Company or its affiliates; (iii) directly or indirectly making any statement that is, or could be, disparaging of the Company or any of its affiliates or any of their respective employees (except to the extent necessary to respond truthfully to any inquiry from applicable regulatory authorities or to provide information pursuant to legal process); (iv) directly or indirectly engaging in any illegal, unethical or otherwise wrongful activity that is, or could be, substantially injurious to the financial condition, reputation or goodwill of the Company or any of its affiliates; or (v) directly or indirectly engaging in an act of misconduct such as, embezzlement, fraud, dishonesty, nonpayment of any obligation owed to the Company or any of its affiliates, breach of fiduciary duty or disregard or violation of rules, policies or procedures of the Company or any of its affiliates, an unauthorized disclosure of any trade secret or confidential information of the Company or any of its affiliates or inducing any customer to breach a contract with the Company or any of its affiliates. For the avoidance of doubt, the Parties acknowledge and agree that competing with the Company and/or its affiliates, where such competition does not involve any of the activities described in the immediately preceding sentence of this Section 7(a), shall not constitute Detrimental Activity.

(b) Non-Solicitation. Until November 30, 2011, McMahon agrees to not directly or indirectly, disrupt, damage, impair or interfere with the Company’s or any of its affiliates’ business by raiding any of the Company’s or such affiliates’ employees or soliciting any of them to resign from their employment by the Company or any such affiliate.

(c) Return of Property. McMahon represents that he has returned all property of First American or any of its affiliates of any nature and description whatsoever in his possession or under his direct or indirect control, including, but not limited to, credit cards, keys, access cards, computer software, files, documents, books and records; provided, however, that McMahon is not required to return the Company-issued mobile phone currently in his possession, which the Company hereby assigns and transfers to McMahon. McMahon acknowledges that from and after his Separation Date he will be responsible for any charges incurred in connection with the use of such mobile phone; provided, further, that to the extent any such property is stored electronically on McMahon’s home computer McMahon agrees to permanently delete such property.

(d) Trade Secrets and Confidential Information. McMahon acknowledges and agrees that he has learned, obtained, acquired, and become aware of information about the Company Releasees (as defined below) and their businesses, including, without limitation, unique selling and servicing methods and business techniques, business strategies, financial information, training, service and business manuals, promotional materials, training courses and other training and instructional materials, vendor and product information, customer and prospective customer lists, other customer and prospective customer information, processes,

-4-

CONFIDENTIAL CONFIDENTIAL

inventions, patents, copyrights, trademarks and other intellectual property and intangible rights, legal matters, personal information regarding officers and other employees, and other business information (collectively referred to as “Confidential Information”). McMahon specifically acknowledges that all such Confidential Information, whether reduced to writing, maintained on any form of electronic media, or maintained in the mind or memory of McMahon and whether compiled by the Company or any of its affiliates or by McMahon derives independent economic value from not being readily known to or ascertainable by proper means by others who can obtain economic value from its disclosure or use, that reasonable efforts have been made by the Company and its affiliates to maintain the secrecy of such information, that such information is the sole property of the Company or an affiliate of the Company and that any retention and use of such information or rights by McMahon shall constitute a misappropriation of the Company’s or its affiliates’ trade secrets, rights or other property. McMahon agrees to refrain from disclosing any Confidential Information to any person, either orally or in writing, for any reason. McMahon acknowledges and agrees that any unauthorized disclosure of Confidential Information would cause irreparable harm to First American and/or its affiliates (at such time or as of the date of this Agreement) and such conduct shall be subject to immediate injunctive relief.

(e) Non-Disparagement of McMahon. Until November 30, 2011, First American will not, by or at the direction of (i) any current or future senior vice president or higher officer of First American or (ii) any current or future senior vice president or higher officer of ISG, make any statement that is, or could be, disparaging of McMahon (except to the extent necessary to respond truthfully to any inquiry from applicable regulatory authorities or to provide information pursuant to legal process).

8. General Release of All Known and Unknown Claims.

(a) Except for First American’s obligations as provided in this Agreement, the Hire Option Agreement, the RSU Agreements with respect to Bonus RSUs and the Other RSUs granted to McMahon in 2007 and that certain Consulting Agreement, dated as of even date herewith between the Company and McMahon (the “Consulting Agreement”), McMahon hereby forever waives, releases, acquits, relieves and discharges First American, and each of its parent corporations, subsidiaries, divisions, or affiliated corporations, organizations or entities (including, but not limited to, The First American Corporation, First American Real Estate Information Services, Inc., First American Real Estate Solutions LLC, First American CoreLogic Holdings, Inc., First Advantage Corporation, First American Financial Corporation, First American Title Insurance Company, and all other subsidiaries and affiliates of The First American Corporation), and each and all of their predecessors, successors, heirs, assigns, officers, employees, directors, shareholders, owners, representatives, consultants, insurers, insurance companies, attorneys and agents, whether previously or hereinafter affiliated in any manner (collectively, the “Company Releasees”), from any and all claims, rights, actions, complaints, demands, causes of action, charges of discrimination, retaliation or harassment, wage claims, whistleblower claims, obligations, promises, contracts, agreements, controversies, suits, debts, expenses, damages, attorneys’ fees, costs and liabilities of any nature whatsoever (collectively, “Claims”), whether or not now known, suspected, claimed, matured or unmatured, which McMahon ever had, now has, or may claim to have from the beginning of time to the date

-5-

CONFIDENTIAL CONFIDENTIAL

of this Agreement against the Company Releasees (whether directly or indirectly), or any of them, by reason of any act, event or omission concerning any matter, cause or thing, including, without limiting the generality of the foregoing, any claims related to or arising out of (i) McMahon’s employment with or service as a director or management committee member of any of the Company Releasees or the cessation of that employment or service as a director or management committee member; (ii) any common law or statutory torts; (iii) any federal, state or governmental constitution, statute, regulation or ordinance, including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the California Fair Employment and Housing Act, the California Labor Code, Insurance Code and Business and Professions Code, the Employee Retirement Income Security Act, the Equal Pay Act, the Americans With Disabilities Act and the Sarbanes-Oxley Act of 2002; and/or (iv) any agreement or covenant, oral or written, express or implied, between McMahon and any of the Company Releasees, provided, however, that the foregoing release is not intended to, and does not, release the Company Releasees from any legal obligation they may otherwise have pursuant to the Articles of Incorporation and Bylaws of The First American Corporation (or the entity comprised of the ISG following the consummation of the Spin-Off) or First Advantage Corporation, or pursuant to any statute, to defend or indemnify McMahon against third party claims that may be filed against him for conduct undertaken by him during the course and scope of his employment with First American or as a director of First Advantage Corporation, respectively; provided, further, that the foregoing release does not apply to those rights which as a matter of law cannot be waived. The Parties acknowledge that nothing in this Section 8(a) or in Section 8(c) shall preclude McMahon from making a claim for unemployment insurance.

(b) Except for McMahon’s obligations as provided in this Agreement, the Hire Option Agreement, the RSU Agreements with respect to Bonus RSUs and the Other RSUs granted to McMahon in 2007 and the Consulting Agreement, First American, on its own behalf and on behalf of each of its affiliates, hereby forever waives, releases, acquits, relieves and discharges McMahon and his heirs and assigns (collectively, the “McMahon Releasees”), from any and all Claims, whether or not now known, suspected, claimed, matured or unmatured, which First American and/or its affiliates ever had, now has, or may claim to have from the beginning of time to the date of this Agreement against the McMahon Releasees (whether directly or indirectly), or any of them, by reason of any act, event or omission concerning any matter, cause or thing, including, without limiting the generality of the foregoing, any claims related to or arising out of (i) McMahon’s employment with or service as a director or management committee member of any of the Company Releasees or the cessation of that employment or service as a director or management committee member; (ii) any common law or statutory torts; (iii) any federal, state or governmental constitution, statute, regulation or ordinance; and/or (iv) any agreement or covenant, oral or written, express or implied, between McMahon and any of the Company Releasees; provided, however, that the foregoing release does not apply to those rights which as a matter of law cannot be waived.

(c) Waiver of Unknown Claims. Further, in connection with the releases set forth above in this Section 8, the Parties expressly agree to waive and relinquish all rights and benefits they may have under Section 1542 of the Civil Code of the State of California or any similar law of any other state. Section 1542 reads as follows:

-6-

CONFIDENTIAL CONFIDENTIAL

“§ 1542. [CERTAIN CLAIMS NOT AFFECTED BY GENERAL RELEASE.] A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

9. Agreement Effective Notwithstanding Subsequent Discovery of Different Facts. The Parties hereto acknowledge that they may discover hereafter facts different from or in addition to those they now know or believe to be true with respect to the claims, demands, causes of action, obligations, damages and liabilities of any nature whatsoever that are the subject of the release set forth in Section 8 of this Agreement, and they each expressly agree to assume the risk of the possible discovery of additional or different facts, and agree that this Agreement shall be and remain effective in all respects regardless of such additional or different facts.

10. Cooperation with Litigation. Following the Separation Date, McMahon agrees to make himself reasonably available to First American and its counsel, without additional compensation, to provide information and assistance related to matters that arose during his former employment, including ongoing litigation. McMahon also agrees to make himself reasonably available to testify at deposition or at trial, without compensation or the necessity of a subpoena, in connection with any such matters; provided, however, that First American will reimburse McMahon for actual and pre-approved reasonable travel expenses incurred by him in connection therewith.

11. No Assignment. McMahon represents and warrants that he has made no assignment, and will make no assignment, of any claim, chose in action, right of action or any right of any kind whatsoever, including, without limitation, any Claim released pursuant to Section 8(a), and that no other person or entity of any kind had or has any interest in any of the demands, obligations, actions, causes of action, debts, liabilities, rights, contracts, damages, attorneys’ fees, costs, expenses, losses or claims referred to herein. First American represents and warrants that, except for any claim, chose in action, right of action or rights assigned or subrogated to its insurance carriers under any applicable policy; it has made no assignment, and will make no assignment, of any claim, chose in action, right of action or any right of any kind whatsoever, including, without limitation, any Claim released pursuant to Section 8(b), and that no other person or entity of any kind had or has any interest in any of the demands, obligations, actions, causes of action, debts, liabilities, rights, contracts, damages, attorneys’ fees, costs, expenses, losses or claims referred to herein.

12. Tax Issues. McMahon agrees to be solely liable for and to pay, indemnify and hold the Company harmless from and against, any and all taxes, costs, interest, assessments, penalties and/or damages that McMahon may owe arising out of any of the payments or distributions made, or to be made, by the Company to McMahon under the terms of this Agreement, the Employment Agreement, the Hire Option Agreement, the Hire RSA Agreement,

-7-

CONFIDENTIAL CONFIDENTIAL

the RSU Agreements and the Consulting Agreement, including, without limitation, Internal Revenue Code Section 409A.

13. Successors and Assigns. This Agreement, and all the terms and provisions hereof, shall be binding upon and shall inure to the benefit of the Parties and their respective heirs, legal representatives, successors and assigns.

14. Voluntary Execution on Advice of Counsel. This Agreement in all respects has been voluntarily and knowingly executed by the Parties. The Parties specifically represent that they have thoroughly discussed all aspects of this Agreement with their attorneys to the extent they so desired, that they have carefully read and fully understand all of the provisions of this Agreement, and that they are voluntarily entering into this Agreement.

15. Severability; Interpretation; Third Party Beneficiary. Should any portion, word, clause, phrase, sentence or section of this Agreement be declared void or unenforceable, such portion shall be considered independent and severable from the remainder, the validity of which shall remain unaffected. Any reference to an affiliate of First American or an affiliate of the Company (including, without limitation, in Sections 7(a), (b), (c) and (d) and Sections 8(a) and (c)) shall be deemed to include the First American Financial Corporation, a Delaware corporation (“FAF”), the entity (if not FAF) that directly or indirectly owns the Company’s financial services group and any affiliate of the foregoing (collectively, the “Financial Services Company”). The Parties intend for the Financial Services Company to benefit from this Agreement and the Financial Services Company is expressly made a third party beneficiary hereof.

16. No Waiver. Failure to insist on compliance with any term, covenant or condition contained in this Agreement shall not be deemed a waiver of that term, covenant or condition, nor shall any waiver or relinquishment of any right or power contained in this Agreement at any one time or more times be deemed a waiver or relinquishment of any right or power at any other time or times.

17. Governing Law. This Agreement is made and entered into in the State of California, and shall in all respects be interpreted, enforced and governed under the laws thereof.

18. Counterparts. This Agreement may be executed in one or more counterparts and the counterparts signed in the aggregate shall constitute a single, original instrument.

19. Entire Agreement. This Agreement constitutes the entire integrated agreement between the Parties regarding the subject matter hereof and supersedes any and all other agreements, understandings, negotiations, or discussions, either oral or in writing, express or implied, regarding the subject matter hereof. The Parties each acknowledge that no representations, inducements, promises, agreements or warranties, oral or otherwise, have been made by them, or anyone acting on their behalf, which are not embodied in this Agreement, that they have not executed this Agreement in reliance on any such representation, inducement, promise, agreement or warranty, and that no representation, inducement, promise, agreement or

-8-

CONFIDENTIAL CONFIDENTIAL

warranty not contained in this Agreement including, without limitation, any purported supplements, modifications, waivers or terminations of this Agreement, shall be valid or binding unless executed in writing by both of the Parties.

20. Signature and Revocation Periods. First American advises McMahon as follows: (a) this Agreement does not waive rights or claims that may arise after McMahon executes it, (b) McMahon has twenty-one (21) days to consider this Agreement and whether he will enter into it, although McMahon may sign it sooner than that if he so desires, (c) that he should consult an attorney before executing this Agreement, and (d) that he may revoke this Agreement at any time within seven (7) days after executing it. This Agreement shall not become effective or enforceable until after the revocation period set forth in subsection (d) immediately above has expired (“Effective Date”).

21. Resignation. McMahon hereby resigns, effective November 30, 2009, all positions as an officer of First American and all positions as an officer or director of any affiliate of First American.

22. Non-Admission. The Parties acknowledge and agree that nothing in this Agreement shall be construed as an admission of any wrongdoing or liability by McMahon, First American, any affiliate of First American or any other Company Releasee.

IN WITNESS WHEREOF, the undersigned have executed this Separation Agreement and General Release on the dates set forth hereinafter.

Dated: January 13, 2010	/s/ Frank V. McMahon
	FRANK V. MCMAHON
	THE FIRST AMERICAN CORPORATION
Dated: January 13, 2010	/s/ Kenneth D. DeGiorgio
	KENNETH D. DEGIORGIO
	SENIOR VICE PRESIDENT

-9-

EX-10.(HHHH)

Exhibit (10)(hhhh)

CONSULTING AGREEMENT

This CONSULTING AGREEMENT (“Agreement”), dated January 13, 2010, by and between The First American Corporation, a California corporation (the “Company”), and Frank V. McMahon (“Consultant”). The parties agree as follows:

1. Services. From the date hereof until November 30, 2011 (the “Term”), the Company has retained Consultant to provide, and Consultant agrees to provide, to the Company and its subsidiaries consulting services as reasonably requested by the Company (collectively, the “Services”), including, without limitation, those services as may be requested to transition employee, client, vendor and other relationships to employees of the Company or its subsidiaries and to complete transactions in which the Company or any of its subsidiaries are involved. Consultant shall report to the chairman of the board, the chief executive officer of the Company and their designees (each such individual a “Designated Representative”).

2. Independent Consultant. Consultant is not an employee or agent of the Company for any purpose. Consultant is an independent Consultant, and he is not eligible to participate in or receive any benefit from any benefit plan, program or other arrangement that may from time to time be available to employees of the Company including, but not limited to, any health, disability, or life insurance, vacation or holiday pay, sick leave, profit sharing or pension plans. The Company will not provide workers’ compensation coverage for Consultant. Consultant is solely responsible for payment of all applicable taxes and withholdings respecting all payments made under this Agreement, and for all claims, damages and/or lawsuits arising out of the acts of Consultant and Consultant’s employees and agents. The Company shall prepare and file a Form 1099 with respect to the payments made to the Consultant hereunder. Consultant does not have authority to obligate or bind the Company in any way, and he will not attempt to do so. The Company shall reimburse Consultant only for those expenses he incurs in connection with performing the Services that are pre-approved in writing by an officer of the Company. The Company is interested only in the results obtained by Consultant, who shall have sole control of the manner and means of performing under this Agreement.

3. Compensation. In consideration for the Services to be rendered by the Consultant hereunder the Company shall pay Consultant the total sum of $1,058,388.00, payable

(a) $50,000 on May 30, 2010 and

(b) provided Consultant has not breached Section 7 of this Agreement:

(i) $479,194.00 on November 30, 2010 and

(ii) $44,099.50 per month on the 30^th day of each month (or if not a business day, the immediately preceding business day) commencing December 30, 2010, with the final payment to be paid on November 30, 2011.

4. Company Property. All access to and use of Company Property must comply with the Company’s policies and procedures, as defined by the Company from time to time.

Consultant agrees to vacate the Company’s facilities (if and to the extent Consultant has been provided access thereto) and return all Company Property (if and to the extent Consultant has been provided such property) immediately upon termination of this Agreement for any reason, or sooner upon request by the Company, and Consultant will pay for any damage to Company Property resulting from Consultant’s actions and omissions. Consultant will not use any Company Property for any purpose other than providing the Services, without the Company’s express prior written consent. For purposes of this Agreement, “Company Property” is the facilities, equipment and other property provided to Consultant for access and/or use in connection with providing the Services.

5. Performance. Consultant agrees to provide the Services with due diligence in compliance with applicable laws and regulations, and in accordance with the highest professional standards of practice in the industry. Consultant will report to and provide the Services in accordance with the instructions of the Designated Representative. The Company shall have no right to control Consultant in the method for performing the Services.

6. Non-Exclusivity of Services. Subject to Section 7, Consultant is free to pursue any and all outside activities and/or employment as Consultant desires, and Company acknowledges that Consultant will likely be involved in other business activities, contracting and/or employment.

7. Non-Compete and Non-Solicit. Section 6 of this Agreement notwithstanding, until November 30, 2010, Consultant will not, directly or indirectly, engage in or render any service of a business, commercial or professional nature to any other person, entity or organization, whether for compensation or otherwise, that is, or has indicated an intention to be, a Competitor (as defined below); provided, for the avoidance of doubt, that this Section 7 shall not preclude Consultant from being employed by or rendering services as an advisor to investment banking or private equity firms so long as in the course of such employment or the rendering of such services Consultant does not, directly or indirectly, engage in or render any services of a business, commercial or professional nature to any other person, entity or organization, whether for compensation or otherwise, that is, or has indicated an intention to be, a Competitor. In accordance with this restriction, but without limiting its terms, Consultant will not:

(a) be employed by, serve as a director to, consult with or provide advice to or otherwise participate in the operations of any Competitor;

(b) solicit customers, business, patronage or orders for, or sell any products or services for any Competitor;

(c) divert, entice, or take away, or attempt to divert, entice or take away, any customers, business, patronage or orders of the Company and its subsidiaries for the benefit of or on behalf of any Competitor; or

(d) promote or assist, financially or otherwise, any person, firm, association, partnership, corporation or other entity that is a Competitor.

-2-

The Company’s sole remedy for a breach of this Section 7 shall be termination of the Company’s obligation to make further payments of any amount pursuant to Section 3(b) and, for the avoidance of doubt, the Company shall not be entitled to other monetary damages or injunctive relief in the event of any such breach. For the avoidance of doubt, a breach of this Section 7 shall not (i) constitute a breach of that certain Separation Agreement and General Release, dated as of even date herewith, between the Company and Consultant (the “Separation Agreement”), except to the extent that the activity resulting in a breach of this Section 7 would constitute a breach of the Separation Agreement by its terms, (ii) shall have no effect on the vesting of the Bonus RSUs or the Other RSUs granted to Consultant in 2007 (each as defined in the Separation Agreement), except to the extent that the activity resulting in a breach of this Section 7 would constitute a breach of the RSU Agreements (as defined in the Separation Agreement) by their terms, (iii) shall have no effect on the vesting of the Initial RSA (as defined in the Separation Agreement) and (iv) shall have no effect on the exercisability of the Initial Option (as defined in the Separation Agreement)

For purposes of this Section 7, “Competitor” means a person or entity that is engaged in, or has indicated an intention to be engaged in, any of the businesses described in the section captioned “The Information Solutions Group” in Part I, Item 1 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2008 (including, without limitation, the subsections captioned as “Information and Outsourcing Solutions Segment”, “Data and Analytic Solutions Segment” and “Risk Mitigation and Business Solutions Segment”), excluding amendments to that section, if any, filed after November 30, 2009. The foregoing notwithstanding, no person or entity shall be deemed a “Competitor” as a result of engaging in activities in which the Company was not actually engaged in as of November 30, 2009.

In the event any executive vice president or higher officer of the Company has determined that Consultant has breached this Section 7, the Company will notify McMahon of such breach within 10 business days thereof.

8. Scope of Restricted Activities. For the purposes of Section 7, but without limitation thereof, Consultant will be in violation thereof if Consultant engages in any or all of the activities set forth therein directly as an individual on Consultant’s own account, or indirectly as a stockholder, partner, joint venturer, employee, agent, salesperson, consultant, officer and/or director of, or by virtue of the ownership by Consultant’s spouse, child or parent of any equity interest in, any firm, association, partnership, corporation or other entity engaging in any or all of such activities; provided, however, Consultant’s or Consultant’s spouse’s, child’s or parent’s ownership of less than one percent (1%) of the issued equity interest in any publicly traded corporation shall not alone constitute a violation of Section 7 of this Agreement.

9. Additional Covenants.

(a) Detrimental Activity. Until November 30, 2011, Consultant agrees to refrain from engaging in any Detrimental Activity (as defined below). For purposes of this Agreement, “Detrimental Activity” means at any time (i) using information received during employment with the Company and/or its affiliates or during the Term relating to the business affairs of the Company or any such affiliates in breach of an express or implied undertaking to keep such information confidential; (ii) directly or indirectly persuading or attempting to

-3-

persuade, by any means, any employee of the Company or any of its affiliates to breach any of the terms of his or her employment with Company or its affiliates; (iii) directly or indirectly making any statement that is, or could be, disparaging of the Company or any of its affiliates or any of their respective employees (except to the extent necessary to respond truthfully to any inquiry from applicable regulatory authorities or to provide information pursuant to legal process); (iv) directly or indirectly engaging in any illegal, unethical or otherwise wrongful activity that is, or could be, substantially injurious to the financial condition, reputation or goodwill of the Company or any of its affiliates; or (v) directly or indirectly engaging in an act of misconduct such as, embezzlement, fraud, dishonesty, nonpayment of any obligation owed to the Company or any of its affiliates, breach of fiduciary duty or disregard or violation of rules, policies or procedures of the Company or any of its affiliates, an unauthorized disclosure of any trade secret or confidential information of the Company or any of its affiliates or inducing any customer to breach a contract with the Company or any of its affiliates. For the avoidance of doubt, the Company and Consultant acknowledge and agree that competing with the Company and/or its affiliates, where such competition does not involve any of the activities described in the immediately preceding sentence of this Section 9(a), shall not constitute Detrimental Activity.

(b) Non-Solicitation. Until November 30, 2011, Consultant agrees to not directly or indirectly, disrupt, damage, impair or interfere with the Company’s or any of its affiliates’ business by raiding any of the Company’s or such affiliates’ employees or soliciting any of them to resign from their employment by the Company or any such affiliate.

10. Scope of Covenants. The Company and Consultant acknowledge that the time, scope, and other provisions of Sections 7, 8 and 9 have been specifically negotiated by sophisticated commercial parties and agree that they consider the restrictions and covenants contained in such Sections to be reasonable and necessary for the protection of the interests of the Company, but if any such restriction or covenant shall be held by any court of competent jurisdiction to be void but would be valid if deleted in part or reduced in application, such restriction or covenant shall apply with such deletion or modification as may be necessary to make it valid and enforceable. The restrictions and covenants contained in each provision of such Sections shall be construed as separate and individual restrictions and covenants and shall each be capable of being severed without prejudice to the other restrictions and covenants or to the remaining provisions of this Agreement.

11. Trade Secrets and Confidential Information. Consultant acknowledges and agrees that he has learned, obtained, acquired, and become aware of, and will learn, obtain, acquire and become aware of information about the Company, its affiliates and their businesses, including, without limitation, unique selling and servicing methods and business techniques, business strategies, financial information, training, service and business manuals, promotional materials, training courses and other training and instructional materials, vendor and product information, customer and prospective customer lists, other customer and prospective customer information, processes, inventions, patents, copyrights, trademarks and other intellectual property and intangible rights, legal matters, personal information regarding officers and other employees, and other business information (collectively referred to as “Confidential Information”). Consultant specifically acknowledges that all such Confidential Information, whether reduced to writing, maintained on any form of electronic media, or maintained in the mind or memory of Consultant

-4-

and whether compiled by the Company or any of its affiliates or by Consultant derives independent economic value from not being readily known to or ascertainable by proper means by others who can obtain economic value from its disclosure or use, that reasonable efforts have been made by the Company and its affiliates to maintain the secrecy of such information, that such information is the sole property of the Company or an affiliate of the Company and that any retention and use of such information or rights by Consultant shall constitute a misappropriation of the Company’s or its affiliates’ trade secrets, rights or other property. Consultant agrees to refrain from disclosing any Confidential Information to any person, either orally or in writing, for any reason. Consultant acknowledges and agrees that any unauthorized disclosure of Confidential Information would cause irreparable harm to the Company and/or its affiliates (at such time or as of the date of this Agreement) and such conduct shall be subject to immediate injunctive relief.

12. Assignment. Consultant will not assign, transfer or subcontract any right in or obligation arising under this Agreement without the Company’s prior written consent. Any assignment in violation of this paragraph shall be void. This Agreement is binding on and will inure to the benefit of each party’s heirs, executors, legal representatives, successors and permitted assigns.

13. General. If any provision of this Agreement is deemed unenforceable, such provision shall be severed from this Agreement and the remaining provisions will remain in full force and effect. This Agreement is governed by and will be interpreted in accordance with the laws of the State of California, without regard to the conflicts of law provisions thereof, or of any other State. No modification of this Agreement will be binding upon either party unless made in writing and signed by a duly authorized representative of such party. The failure of the Company to require performance by Consultant of any provision hereof shall not affect the full right to require such performance at any time thereafter; nor shall the waiver by the Company of a breach of any provision hereof by Consultant be taken or held to be a waiver of the provision itself. This Agreement contains the entire agreement and understanding of the parties hereto with respect to the subject matter hereof, and mergers and supercedes all prior agreements, discussions and writings with respect thereto.

14. Termination. Consultant may terminate this Agreement at any time upon delivery of written notice to the Company. Upon delivery of such notice, Consultant’s and the Company’s obligations hereunder, shall terminate and be of no further force and effect; provided, however, that Sections 4, 9, 11, 12, 13 and 14 of this Agreement shall survive any such termination.

BY SIGNING BELOW, THE PARTIES ACKNOWLEDGE THAT THEY HAVE CAREFULLY READ AND UNDERSTAND THE OBLIGATIONS IMPOSED BY THIS AGREEMENT. NO PROMISES OR REPRESENTATIONS HAVE BEEN MADE BY THE PARTIES OTHER THAN AS EXPRESSLY SET FORTH IN THIS AGREEMENT.

-5-

IN WITNESS WHEREOF the undersigned have executed this Agreement as of the day and year first written above. The parties hereto agree that facsimile signatures shall be as effective as if originals.

THE FIRST AMERICAN CORPORATION
By:	/s/ Kenneth D. DeGiorgio
	Kenneth D. DeGiorgio
	Senior Vice President
Dated: January 13, 2010
FRANK V. MCMAHON
/s/ Frank V. McMahon
Dated: January 13, 2010

-6-

EX-21

Exhibit 21

Subsidiaries of the Registrant

Name of Subsidiary:	State or Country Under Laws of Which Organized
1031 Corp.	Pennsylvania
1031 USA, LLC	Pennsylvania
Abstracters` Information Service, Inc.	New York
Accounting Services, LLC	Minnesota
Accufacts Pre-Employment Screening, Inc.	Delaware
Accu-Search, Inc.	New Jersey
Advanced Collateral Solutions, LLC	Delaware
Alliance Home Warranty, Inc.	Utah
America’s Innovative Insurance Solutions, Inc.	California
American Data Exchange Corporation Ltd.	Bermuda
American Driving Records, Inc.	California
American Escrow Company	Texas
American First Abstract, LLC	Delaware
American Property Exchange, Inc.	Washington
Arizona Title Insurance Agency, Inc	Arizona
ATI Title Agency of Arizona, Inc.	Arizona
ATI Title Agency of Ohio, Inc.	Ohio
ATI Title Company of Alabama, LLC	Alabama
ATI Title Company, LLC	Delaware
ATI Title of Nevada, Inc.	Nevada
Atone Acquisition Corporation	Delaware
Atone Software, Inc	Delaware
Augusta Holdings, LLC	Delaware
Basis100 Corporation	California
Basis100, Inc	Ontario
Brownstone Technologies Inc.	Canada
C&S Appraisal, LLC	Minnesota
Cahaba Title Company, Inc.	Alabama
Campbell County Abstract Company	Wyoming
Consumer Select Insurance, LLC	Florida
Consumer Select Insurance of America, LLC	Florida
Core Title Agency, Ltd.	Ohio
Corea Title Company	Korea
CoreLogic, Inc.	Delaware
CreditReportPlus, LLC	Maryland
Current Status, Inc.	New Jersey
Customers Choice Title Agency, Ltd.	Ohio
Data Trace Abstractor Services, LLC	Delaware
Data Trace Information Services LLC	Delaware
Data Trace Information Services II LLC	Delaware
Data Tree LLC	California
Data Tree II LLC	Delaware
Decision Payroll Services, Inc.	Florida
DecisionHR, Inc.	Florida
DecisionHR 30, Inc.	Florida
DecisionHR I, Inc.	Florida
DecisionHR II, Inc.	Oklahoma
DecisionHR V, Inc.	Florida
DecisionHR VII, Inc.	Georgia
DecisionHR VIII, Inc.	Florida
DecisionHR IX, Inc.	Florida
DecisionHR XIII, Inc.	Florida
DecisionHR XIV, Inc.	Florida

Name of Subsidiary:	State or Country Under Laws of Which Organized
DecisionHR USA, Inc.	Florida
Discovery Title Company, LLC	Michigan
DRN Commerce, Inc.	California
eAppraiseIT, LLC	Delaware
enact Conveyancing Limited	England
enact Holdings Limited	England
Enact Processing Solutions Limited	England
enact Properties Limited	England
Equity Title Insurance Agency, Inc.	Utah
FA Locate, Inc.	Delaware
FADV CMSI, Inc.	Delaware
FADV Holdings LLC	Delaware
FADV Malaysia Sdn Bhd	Malaysia
FAF International Holdings B.V.	Netherlands
FAF International Insurance Holdings B.V.	Netherlands
FAF International Property Services Holdings B.V.	Netherlands
FAF International Limited	England
FAF International Pty Limited	Australia
FAF International Limited	New Zealand
FAF International Seguros Generales S.A.	Chile
FAF Servicios Hipotecarios Limitada	Chile
Fairbanks Title Agency, Inc.	Alaska
FASLO Solutions, LLC	Delaware
FATCO Holdings, LLC	Delaware
FATNY Realty Holdings LLC	New York
Faxxon Legal Information Services, Inc.	Illinois
FCT Holdings Company Ltd.	Canada
FCT Insurance Company Ltd.	Canada
FCT Insurance Services Inc.	Canada
Finiti, LLC	Delaware
Finiti Group, LLC	Delaware
Finiti Title, LLC	Delaware
Finiti Title of Alabama, LLC	Alabama
First Advantage (Beijing) Co., Ltd.	China
First Advantage (Zhuhai) Co., Limited	China
First Advantage (HK) Limited	Hong Kong
First Advantage Australasia Pty Ltd.	Australia
First Advantage Australia Pty Ltd	Australia
First Advantage Background Services Corp.	Florida
First Advantage Canada, Inc.	Canada
First Advantage Corporation	Delaware
First Advantage Credco LLC	Delaware
First Advantage Enterprise Screening Corporation	Delaware
First Advantage Eurasia Litigation	Belgium
First Advantage Europe Ltd.	United Kingdom
First Advantage Hiring Management Systems Limited	United Kingdom
First Advantage Japan KK	Japan
First Advantage Limited	Hong Kong
First Advantage Litigation Consulting Japan GK	Japan
First Advantage Litigation Consulting, LLC	Virginia
First Advantage Membership Services, Inc.	California
First Advantage Occupational Health Services Corp.	Florida
First Advantage Offshore Services Private Limited	India
First Advantage Private Limited	India
First Advantage Philippines, Inc.	Philippines
First Advantage Pte. Ltd.	Singapore

Name of Subsidiary:	State or Country Under Laws of Which Organized
First Advantage Public Records, LLC	Delaware
First Advantage Quest Research Corporation	Cayman Islands
First Advantage Quest Research Group Ltd.	British Virgin Islands
First Advantage Quest Research Limited	British Virgin Islands
First Advantage SafeRent, Inc.	Delaware
First Advantage Supply Chain Security, LLC	Arizona
First Advantage Talent Management Services LLC	Delaware
First Advantage Tax Consulting Services, LLC	Delaware
First American Abstract Company	Mississippi
First American Capital Trust I	Delaware
First American Centralized Services, Inc.	Delaware
First American China Holdings, LLC	Delaware
First American Commercial Real Estate Services, Inc.	Florida
First American Coordination Services, LLC	Kansas
First American CoreLogic Holdings, Inc.	Delaware
First American CoreLogic, Inc.	Delaware
First American Corporate Services, LLC	Delaware
First American Credco of Puerto Rico, Inc.	Delaware
First American Default Information Services LLC	Florida
First American Exchange Company, LLC	Delaware
First American Exchange Corporation	New York
First American Financial Corporation	Delaware
First American Flood Hazard Certification LLC	Delaware
First American Fund Control, Inc.	California
First American Global Services, Inc.	Delaware
First American Holding Corporation	Delaware
First American Holdings, LLC	Delaware
First American Holdings (Mauritius) Limited	Mauritius
First American Home Buyers Protection Corporation	California
First American Home Warranty Corp.	Florida
First American Indian Holdings LLC	Delaware
First American (India) Private Limited	India
First American International Holdings, LLC	Delaware
First American International Title Services Inc.	Canada
First American International, Inc.	Delaware
First American Leasing Company	California
First American LoanStar Trustee Services, LLC	Texas
First American Professional Real Estate Services, Inc	California
First American Property & Casualty Insurance Agency, Inc	California
First American Property & Casualty Insurance Agency, LLC	Delaware
First American Property & Casualty Insurance Company	California
First American Real Estate Flood & Tax Solutions LLC	Delaware
First American Real Estate Information Services, Inc.	California
First American Real Estate Solutions LLC	California
First American Real Estate Solutions II LLC	California
First American Real Estate Tax Service LLC	Delaware
First American Real Property Services, G.P.	Texas
First American Relocation Solutions, Inc.	Delaware
First American Servicing Solutions, LLC	Delaware
First American SMS, LLC	Delaware
First American Specialty Insurance Company	California
First American Technology Advantage, LLC	Kansas
First American Teton Land Title Company	Wyoming
First American Title & Trust Company	Oklahoma
First American Title Company	California
First American Title Company, Inc.	Florida

Name of Subsidiary:	State or Country Under Laws of Which Organized
First American Title Company, Inc. (Hawaii)	Hawaii
First American Title Company, LLC (DE)	Delaware
First American Title Company, LLC (TX)	Texas
First American Title Company of Laramie County	Wyoming
First American Title Insurance Agency of Mohave, Inc.	Arizona
First American Title Insurance Agency, Inc. (Navajo)	Arizona
First American Title Insurance Company	California
First American Title Insurance Company of Australia Pty Limited	Australia
First American Title Insurance Company of Louisiana	Louisiana
First American Title Insurance Company of New York	New York
First American Title Services de Mexico S. de R.L. de C.V.	Mexico
First American Trust, F.S.B.	California
First American UCC Insurance Services, LLC	Delaware
First American United General Alaska LLC	Alaska
First Australian Company Pty Limited	Australia
First Australian Title Company Pty Limited	Australia
First Canadian CREDCO, Inc.	Canada
First Canadian Title Company Limited	Canada
First European Title GmbH	Germany
First European Group Limited	United Kingdom
First Florida Title Insurance Agency, LLC	Florida
First Hong Kong Title Limited	Cayman Islands
First Indian Corporation Private Limited	India
First Indian Services Private Limited	India
First International Real Estate Solutions Limited	United Kingdom
First Metropolitan Title Company	Michigan
First Mortgage Services Ltd.	New Zealand
First Mortgage Services Pty Ltd	Australia
First Reliable, LLC	Delaware
First Security Business Bank	California
First Title Real Estate Guaranty Co., Ltd	China
First Title CEE (Biztositaskovetito Korltotl Feleossegu Tarsasag)	Hungary
First Title Insurance plc	England
First Title Insurance Brokers Limited	England
First Title Sigorta Aracilik Hizmetieri Anonim Sirketi	Turkey
First Title New Zealand Limited	New Zealand
First Title Pacific Limited	New Zealand
First Title plc	England
First Title Polska Sp. Z.o.o	Poland
First Title Services Limited	England
First Valley Title, LLC	Arizona
Florida Sunshine Title, L.L.C.	Michigan
FMCT, L.L.C.	Michigan
FMS Administration Limited	New Zealand
Foundation Title Company, LLC	Maine
Fortune Title Agency, Ltd	Ohio
Greater Michigan Title, LLC	Michigan
Happy Home Buying, Ltd.	Cayman Islands
Harrison Title Agency, Ltd	Ohio
Harvard Design and Mapping Company, Inc.	Massachusetts
Heritage Closing Services, Inc	California
Information Solutions Holdings (Mauritius) Limited	Mauritius
Intertitle, Inc	California
Island Title Corporation	Hawaii
Jenark Business Systems, Inc.	Maryland
Johnson County Title Company, Inc.	Wyoming

Name of Subsidiary:	State or Country Under Laws of Which Organized
JV Mortgage Solutions, LLC	Delaware
Konstar Title Insurance Agency, L.L.C.	Michigan
LeadClick Holding Company, LLC	Delaware
LeadClick Media, Inc.	California
Legends Title Agency, Ltd.	Ohio
Live Letting Exchange Limited	United Kingdom
Live Overseas Limited	United Kingdom
MarketLinx Corp.	Canada
MarketLinx, Inc.	Tennessee
Market Center Title, L.L.C.	Michigan
Masiello Closing Services, LLC	Michigan
Massachusetts Title Insurance Company	Massachusetts
Metropolitan Title – Wisconsin, L.L.C.	Michigan
Metropolitan Title—Ohio, L.L.C.	Michigan
Metropolitan Title of Indiana, LLC	Indiana
Mid Valley Title and Escrow Company	California
Millenium Title Agency, LLC	Michigan
Mortgage Guarantee & Title Company	Rhode Island
Mt. Shasta Title & Escrow Company	California
Multifamily Community Insurance Agency, Inc.	Maryland
National Background Data, LLC	Delaware
National Data Registry, LLC	Delaware
National Default REO Services, LLC	Delaware
National Land Title of Tarrant, Inc	Texas
New Reunion Title, LLC	Texas
NZ Background (2006) Limited	New Zealand
Ohio Bar Title Insurance Company	Ohio
Omega Insurance Services, Inc.	Florida
Orange Coast Holdings, Inc.	Delaware
Orange Coast Title Company	California
Overseas Homes Network Limited	United Kingdom
Pacific Northwest Title Company	Washington
Pacific Northwest Title Company of Alaska, Inc.	Alaska
Pacific Northwest Title Company of Kenai, Inc.	Alaska
Pacific Northwest Title Holding Company	Washington
Pacific Northwest Title Insurance Company	Washington
Pacific Northwest Title of Oregon, Inc.	Oregon
Partners Title Agency, LLC	Michigan
Pioneer Agency Acquisition Company	Pennsylvania
Presidential Title Services A Title Agency LLC	Michigan
PrideRock Holding Company, Inc.	Alabama
Proxix Solutions, Inc	Florida
Promeric Technologies Inc.	Canada
Public Abstract Corporation	New York
Quantrix Credit Services, LLC	Delaware
Quantrix, LLC	Delaware
Regency Escrow Corporation	California
Relocation Advantage, LLC	Delaware
RELS, LLC	Delaware
RELS Management Company, LLC	Delaware
RELS Reporting Services, LLC	Iowa
RELS Title Services, LLC	Delaware
Republic Title of Texas, Inc.	Texas
RES Direct, LLC	Delaware
Rock River Title, L.L.C.	Illinois
Russ Lyon Title, LLC	Arizona

Name of Subsidiary:	State or Country Under Laws of Which Organized
Sanderson Weir Pty Ltd	Australia
Screeners Advantage, Inc.	Delaware
SecoLink Information Services, LLC	Pennsylvania
SecoLink Management Services, LLC	Pennsylvania
SecoLink Settlement Services, LLC	Pennsylvania
Security Exchange Corporation	Nebraska
Security First Financial Services, Inc	Florida
SFG Title Agency, LLC	Michigan
Shoshone Title Insurance and Abstract Company	Wyoming
Smart Title Solutions LLC	Delaware
Soluciones Prediales de Mexico, S. de R.L.	Mexico
Southwest Title Land Company	Oklahoma
Statistics Data, Inc	Delaware
Team Conveyancing Limited	England
Teletrack UK Limited	United Kingdom
Teletrack, Inc.	Georgia
Texas Escrow Company	Texas
The Executive Corner Title and Settlement Services, LLC	Ohio
The First American Financial Corporation	California
The Heritage Escrow Company, Inc.	California
The Hyper-Abstract Corporation	New York
The Inland Empire Service Corporation	California
The Live Organization Limited	United Kingdom
The Orange Coast Company, LLC	Delaware
The Title Security Group, Inc.	Puerto Rico
Title Company of the Americas, S.A.	Nicaragua
Title Insurance Agency of Juneau, Inc.	Alaska
Title Insurance Company of Oregon	Oregon
Title Records, Inc.	California
Titlestar Mortgagee Services, L.L.C.	Texas
Total Scoring Company, Inc.	Canada
TP Verify Screening Pvt Limited	India
Tri-County Title Services, LLC	Michigan
UKValuation Limited	United Kingdom
United General Title Insurance Company	Colorado
Valuation Information Technology, L.L.C.	Iowa
Vehicle Title, LLC	Delaware
Vehicle Title Agency, LLC	Delaware
Ventext Corporation	California
Verify (Mauritius) Limited	Mauritius
Verify Limited	Mauritius
Westlake Settlement Services, LLC	Delaware
Word of Mouth Investment Consulting Co., Ltd.	China
Wyoming Land Title Company	Wyoming

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (Nos. 333-126545 and 333-155773), Form S-4 (Nos. 333-121617, 333-107494 and 333-162398) and Form S-8 (Nos. 333-134283, 333-113269, 333-111829, 333-74620, 333-41993, 333-105428, 333-67451, 333-62918, 333-78537 and 333-163197) of The First American Corporation of our report dated March 1, 2010 relating to the financial statements, financial statement schedules and the effectiveness of internal control over financial reporting, which appears in this Form 10-K.

/S/ PRICEWATERHOUSECOOPERS LLP

PricewaterhouseCoopers LLP

Orange County, California

March 1, 2010

EX-31.(A)

Exhibit 31(a)

CERTIFICATIONS

I, Parker S. Kennedy, certify that:

1. I have reviewed this annual report on Form 10-K of The First American Corporation (“registrant”);

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s Board of Directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 1, 2010

/S/ PARKER S. KENNEDY

Parker S. Kennedy

Chief Executive Officer

(Principal Executive Officer)

EX-31.(B)

Exhibit 31(b)

CERTIFICATIONS

I, Anthony S. Piszel, certify that:

1. I have reviewed this annual report on Form 10-K of The First American Corporation (“registrant”);

2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s Board of Directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 1, 2010

/S/ ANTHONY S. PISZEL

Anthony S. Piszel

Chief Financial Officer and Treasurer

(Principal Financial Officer)

EX-32.(A)

Exhibit 32(a)

Certification pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Form 10-K of The First American Corporation (the “Company”) for the period ended December 31, 2009, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Parker S. Kennedy, chief executive officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

/S/ PARKER S. KENNEDY

Parker S. Kennedy

Chief Executive Officer and Chairman

March 1, 2010

The foregoing certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. § 1350, and is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

EX-32.(B)

Exhibit 32(b)

Certification pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Form 10-K of The First American Corporation (the “Company”) for the period ended December 31, 2009, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Anthony S. Piszel, chief financial officer and treasurer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

/S/ ANTHONY S. PISZEL

Anthony S. Piszel

Chief Financial Officer and Treasurer

March 1, 2010

The foregoing certification is being furnished solely to accompany the Report pursuant to 18 U.S.C. § 1350, and is not being filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.