<PAGE>
Exhibit 10.18
STANDARD OFFICE LEASE--NET
AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION
[LOGO OF AIR]
1. Basic Lease Provisions
("Basic Lease Provisions")
1.1 Parties: This Lease, dated, for
reference purposes only, November 26,
2001 is made by and between
CTF2 - Outlet LLC, A Delaware Limited Liability
Company, (herein called
"Lessor") and QuadraMed Corporation, doing business
under the name of
_____________________________________________________,
(herein
called "Lessee").
1.2 Premises: Suite Number(s) 104
& 105 floors, consisting of
approximately 41,000 square
feet, more to less, as defined in paragraph 2 and as
shown on Exhibit "A" hereto
(the "Premises").
1.3 Building: Commonly described as
being located at 1050 Los Vallecitos
Blvd, in the City of San
Marcos, County of San Diego, State of California, as
more particularly described
in Exhibit A hereto, and as defined in paragraph 2.
1.4 Use: Administrative Offices,
subject to paragraph 6.
1.5 Term: seventy-two (72) months
commencing See paragraph 52
("Commencement Date") and
ending seventy-two (72) months after commencement
date, as defined in paragraph
3.
1.6 Base Rent: See paragraph 51 per
month, payable on the 1st day of each
month, per paragraph 4.1
______________________________________________________.
1.7 Base Rent Increase: On See
paragraph 51.
1.8 Rent Paid Upon Execution:
$45,100.00 for **.
1.9 Security Deposit: $250,OO0.00 (see
paragraph 61).
1.10 Lessee's
Share of Operating Expenses: 39% as defined in paragraph
4.2
*See paragraph 55
2. Premises, Parking and Common
Areas.
2.1 Premises: The Premises are a
portion of a building, herein sometimes
referred to as the "Building"
identified in paragraph 1.3 of the Basic Lease
Provisions "Building" shall
include adjacent parking structures used in
connection therewith. The
Premises, the Building, the Common Areas, the land
upon which the same are
located, along with all other buildings and improvements
thereon to thereunder, are
herein collectively referred to as the "Office
Building Project," Lessor
hereby leases to Lessee and Lessee leases from Lessor
for the term, at the rental,
and upon all of the conditions set forth herein,
the real property referred to
in the Basic Lease Provisions, paragraph 1.2, as
the "Premises", including
rights of the Common Areas as hereinafter specified.
2.2 Vehicle Parking: So long as Lessee
is not in default and subject to
the rules and regulations
attached hereto, and as established by Lessor from
time to time, Lessee shall be
entitled to use 6/1000 parking spaces in the
Office Building Project at no
cost throughout the Term or the Option Term. See
Paragraph 59.
2.2.1 If Lessee commits, permits to allows any of the
prohibited
activities described in the
Lease or the rules then in effect, then Lessor shall
have the right, without
notice. In addition to such other rights and remedies
that it may have, to remove
or low away the vehicle involved and charge the cost
to Lessee, which cost shall
be immediately payable upon demand by Lessor.
2.3 Common Areas-Definition. The term
"Common Areas" is defined as all
areas and facilities outside
the Premises and within the exterior boundary line
of the Office Building
Project that are provided and designated by the Lessor
from time to time for the
general non-exclusive use of Lessor, Lessee and of
other lessees of the Office
Building Project and their respective employees,
suppliers, shippers,
customers and invitees, including but not limited to
common
entrances, lobbies,
corridors, stairways and stairwells, public restrooms,
elevators, escalators,
parking areas to the extent not otherwise prohibited by
this Lease, loading and
unloading areas, trash areas, roadways, sidewalks,
walkways, parkways, ramps,
driveways, landscaped areas and decorative walls.
2.4 Common Areas-Rules and
Regulations. Lessee agrees to abide by and
conform to the rules and
regulations attached hereto as Exhibit B with respect
to the Office Building
Project and Common Areas, and to cause its employees,
suppliers, shippers,
customers, and invitees to so abide and conform Lessor
or
such other person(s) as
Lessor may appoint shall have the exclusive control and
management of the Common
Areas and shall have the right, from time to time, to
modify, amend and enforce
said rules and regulations which such modifications
shall be in writing. Lessor
shall not be responsible to Lessee for the
non-compliance with said
rules and regulations by other lessees, their agents,
employees and invitees of the
Office Building Project.
2.5 Common Areas-Changes. Lessor shall
have the right, in Lessor's sole
discretion, from time to
time:
(a) To make changes to
the Building interior and exterior and Common
Areas, including, without
limitation, changes in the location, size, shape,
number, and appearance
thereof, including but not limited to the lobbies,
windows, stairways, air
shafts, elevators, escalators, restrooms, driveways,
entrances, parking spaces,
parking areas, loading and unloading areas, ingress,
egress, direction of traffic,
decorative walls, landscaped areas and walkways;
provided, however Lessor
shall at all times provide the parking facilities
required by applicable law
and Lessee shall at all times during the term and the
Option Term be entitled to
6/1000 spaces.
(b) To close
temporarily any of the Common Areas for maintenance
purposes so long as
reasonable access to the Premises remains available:
(c) To designate other
land and improvements outside the boundaries
of the Office Building
Project to be a part of the Common Areas, provided that
such other land and
improvements have a reasonable and functional
relationship
to the Office Building
Project;
(d) To add additional
buildings and improvements to the Common Areas:
(e) To use the Common
Areas while engaged in making additional
improvements, repairs or
alterations to the Office Building Project or any
portion thereof:
(f) To do and perform
such other acts and make such other changes in,
to or with respect of the
Common Areas and Office Building Project as Lessor
may, in the exercise of sound
business judgment deem to be appropriate.
3. Term.
3.1 Term. The term and Commencement
Date of this Lease shall be as
specified in paragraph 1.5 of
the Basic Lease Provisions.
3.2 Delay in Possession.
Notwithstanding said Commencement Date, if for
any reason Lessor cannot
deliver possession of the Premises to Lessee on said
date and subject to paragraph
3.2.2, Lessor shall not be subject to any
liability therefor, nor shall
such failure affect the validity of this Lease or
the obligations of Lessee
hereunder or extend the term hereof; but in such case,
Lessee shall not be deligated
to pay rent to perform any other obligation of
Lessee under the terms of
this Lease, except as may be otherwise provided in
this Lease, until possession
of the Premises is tendered to Lessee, as
hereinafter defined;
provided, however, that if Lessor shall not have
delivered
possession of the Premises
within sixty (60) days following said Commencement
Date, as the same may be
extended under the terms of a Work Letter executed by
Lessor and Lessee, Lessee
may, at Lessee's option, by notice in writing to
Lessor within ten (10)
business days thereafter, cancel this Lease, in which
event the parties shall be
discharged from all obligations hereunder; provided,
however, that, as of Lessee's
obligations, Lessee first reimburses Lessor for
all costs incurred for
Non-Standard Improvements and, as of Lessor's
obligations, Lessor shall
return any money previously deposited by Lessee (less
any offsets due Lessor for
Non-Standard Improvements); and provided further,
that if such written notice
by Lessee is not received by Lessor within said ten
(10) business day period,
Lessee's right to cancel this Lease hereunder shall
terminate and be of no
further force to effect. See Paragraph 52 To be credited
towards Base Rent for the
first month after the Commencement Date with the
remainder to be credited
towards Base Rent after the Rent Credit per Exhibit C
Paragraph 3(d).
<PAGE>
3.2.1 Possession Tendered-Defined. Possession of the Premises shall
be
deemed tendered of Lessee
("Tender of Possession") when (1) the improvements to
be provided by Lessor under
this Lease are substantially completed, (2) the
Building utilities are ready
for use in the Premises. (3) Lessee has reasonable
access of the Premises, and
(4) ten (10) days shall have expired following
advance written notice to
Lessee of the occurrence of the matters described in
(1), (2), (3), and (4) The
City of San Marcos has completed and approved the
final inspection of the
tenant improvements. above of this paragraph 3.2.1.
3.2.2 Delay Caused by Lessee. There shall be no abatement of
rent,
and the sixty (60) day period
following the Commencement Date before which
Lessee's right to cancel this
Lease accrues under paragraph 3.2, shall be deemed
extended to the extent of any
delays caused by acts to omissions of Lessee, its
agents, employees and
contractors.
3.3 Early Possession. If Lessee
occupies the Premises prior to said
Commencement Date, such
occupancy shall be subject to all provisions of this
lease such occupancy shall
not change the terminations date and Lessee shall pay
rent for such occupancy.
Notwithstanding the foregoing, Lessee may occupy
Premises up to 30 days prior
to Commencement Date without payment of rent.
3.4 Uncertain Commencement. In the
event commencement of the Lease term is
defined as the completion of
the improvements, Lessee and Lessor shall execute
an amendment to this Lease
establishing the date of Tender of Possession (as
defined in paragraph 3.2.1)
as the Commenncement Date.
4. Rent
4.1 Base Rent Subject to adjustment as
hereinafter provided in paragraph
4.3, and except as may be
otherwise expressly provided in this Lease, Lessee
shall pay to Lessor the Base
Rent for the Premises set forth in paragraph 1.6 of
the Basic Lease Provisions,
without offset to deduction. Lessee shall pay Lessor
upon execution hereof the
advance Base Rent described in paragraph 1.8 of the
Basic Lease Provisions. Rent
for any period during the term hereof which is for
less than one month shall be
prorated based upon the actual number of days of
the calendar month involved.
Rent shall be payable in lawful money of the United
States to Lessor at the
address stated herein or to such other persons or at
such other places as Lessor
may designate in writing.
4.2 Operating Expenses. Lessee shall
pay of Lessor during the term hereof,
in addition to the Base Rent,
Lessee's Share as hereinafter defined of all
Operating Expenses, as
hereinafter defined, during each calendar year of the
term of the Lease, to
accordance with the following provisions.
(a) "Lessee's Share"
is defined, for purposes of this Lease, as the
percentage set forth in
paragraph 1.10 of the Basic Lease Provisions, which
percentage has been
determined by dividing the approximate square footage of
the
Premises by the total
approximate square footage of the rentable space
contained
in the Office Building
Project. It is understood and agreed that the rentable
area of square footage
figures set forth in the Basic Lease Provisions are
approximations which Lessor
and Lessee agree are reasonable and shall not be
subject to revision except in
connection with an actual change in the size of
the Premises to a change in
the space available for lease in the Office Building
Project.
(b) "Operating
Expenses" is defined, for purposes of this Lease, to
include all costs, if any,
incurred by Lessor in the exercise of its reasonable
discretion, for:
(i) The operation, repair, maintenance, and replacement,
in
neat, clean, sale, good order
and condition, of the Office Building Project,
including but not limited to,
the following:
(aa) The Common Areas, including their surfaces,
coverings,
decorative items, carpets,
drapes and window coverings, and including parking
areas, loading and unloading
areas, trash areas, roadways, sidewalks, walkways,
stairways, parkways,
driveways, landscaped areas, striping, bumpers,
irrigation
systems, Common Area lighting
facilities, building exteriors and roofs, fences
and gates;
(bb) All heating, air conditioning, plumbing, electrical
systems, life safety
equipment, telecommunication and other equipment used in
common by, to for the benefit
of, lessees or occupants of the Office Building
Project, including elevators
and escalators, tenant directories, fire detection
systems including sprinkler
system maintenance and repair.
(ii) Trash
disposal, janitorial and security services;
(iii) Any other
service to be provided by Lessor that is
elsewhere in this Lease
stated to be an "Operating Expense";
(iv) The cost of
the premiums for the liability and properly
insurance policies to be
maintained by Lessor under paragraph 8 hereof;
(v) The
amount of the real property taxes to be paid by Lessor
under paragraph 10.1
hereof;
(vi) The cost of
water, sewer, gas, electricity, and other
publicly mandated services to
the Office Building Project;
(vii) Labor, salaries
and applicable fringe benefits and costs,
materials, supplies and
tools, used in maintaining and/or cleaning the Office
Building Project and
accounting and a management lee attributable to the
operation of the Office
Building Project;
(viii) Replacing and/or adding improvements mandated by
any
governmental agency after the
completion date of the tenant improvements and any
repairs to removals
necessitated thereby amortized over its useful life
according to Federal income
tax regulations or guidelines for depreciation
thereof (including interest
on the unamortized balance as is then reasonable in
the judgment of Lessor's
accountants);
(ix)
Replacements of equipment to improvements that have a
useful life for depreciation
purposes according to 'Federal income tax
guidelines of five (5) years
or less, as amortized over such life.
(c) Operating Expenses
shall not include the costs of replacements of
equipment or improvements
that have a useful life for Federal income tax
purposes in excess of five
(5) years unless it is of the type described in
paragraph 4.2(b)(viii), in
which case their cost shall be included as above
provided.
(d) Operating Expenses
shall not include any expenses paid by any
lessee directly to third
parties, or as to which Lessor is otherwise reimbursed
by any third party, other
tenant, or by insurance proceeds.
(e) Lessee's Share of
Operating Expenses shall be payable by Lessee
within ten (10) Days after a
reasonably detailed statement of actual expenses is
presented to Lessee by
Lessor. At Lessor's option, however, an amount may be
estimated by Lessor from time
to time of Lessee's Share of annual Operating
Expenses and the same shall
be payable monthly to quarterly, as Lessor shall
designate, during each
calendar year of the Lease term, on the same day as the
Base Rent is due hereunder.
In the event that Lessee pays Lessor's good faith
estimate of Lessee's Share of
Operating Expenses as aforesaid, Lessor shall
deliver to Lessee within
sixty (60) days after the expiration of each calendar
year a reasonably detailed
statement showing Lessee's Share of the actual
Operating Expenses incurred
during the preceding year. If Lessee's payments
under this paragraph 4.2(e)
during said preceding calendar year exceed Lessee's
Share as indicated on said
statement. Lessee shall be entitled to credit the
amount of such overpayment
against Lessee's Share of Operating Expenses next
falling due. If Lessee's
payments under this paragraph during said preceding
calendar year were less than
Lessee's Share as indicated on said statement.
Lessee shall pay to Lessor
the amount of the deficiency within ten (10) days
after delivery by Lessor of
Lessee of said statement.
5. Security Deposit. Lessee
shall deposit with Lessor upon execution
hereof the security deposit
set forth in paragraph 1.9 of the Basic Lease
Provisions as security for
Lessee's faithful performance of Lessee's obligations
hereunder. If Lessee fails to
pay rent or other charges due hereunder, or
otherwise defaults with
respect to any provision of this Lease. Lessor may use,
apply or retain all to any
portion of said deposit for the payment of any rent
to other charge in default
for the payment of any other sum to which Lessor may
become obligated by reason of
Lessee's default or to
<PAGE>
compensate Lessor for any
loss or damage which Lessor may suffer thereby. If
Lessor so uses or applies all
or any portion of said deposit, Lessee shall
within ten (10) days after
written demand therefor deposit cash with Lessor in
an amount sufficient to
restore said deposit to the full amount then required
of Lessee. Lessor shall not
be required of keep said security deposit separate
from its general accounts. If
Lessee performs all of Lessee's obligations
hereunder, said deposit, or
so much thereof as has not heretofore been applied
by Lessor, shall be returned,
without payment of interest or other increment for
its use, to Lessee (or, at
Lessor's option, to the last assignee, if any, of
Lessee's Interest hereunder)
at the expiration of the term hereof, and after
Lessee has vacated the
Premises. No trust relationship is created herein
between
Lessor and Lessee with
respect to said Security Deposit.
6. Use
6.1 Use. The Premises shall be used
and occupied only for the purpose set
forth in paragraph 1.4 of the
Basic Lease Provisions
6.2 Compliance with Law.
(a)
Lessor warrants of
Lessee that the Premises, in the state
existing on the date that the
Lease term commences, but without regard to
alterations or Improvements
made by Lessee or the use for which Lessee will
occupy the Premises, does not
violate any covenants or restrictions of record,
or any applicable building
code, regulation or ordinance in effect on such Lease
term Commencement Date. In
the event it is determined that this warranty has
been violated, then it shall
be the obligation of the Lessor, after written
notice from Lessee, to
promptly, at Lessor's sole cost and expense, rectify any
such violation.
(b) Except as provided
in paragraph 6.2(a) Lessee shall, at Lessee's
expense, promptly comply with
all applicable statutes, ordinances, rules,
regulations, orders,
covenants and restrictions of record, and requirements
of
any fire insurance
underwriter or rating bureaus, now in effect to which
may
hereafter come into effect,
whether or not they reflect a change in policy from
that now existing, during the
term or any part of the term hereof, relating in
any manner to the Premises
and the occupation and use by Lessee of the Premises.
Lessee shall conduct its
business in a lawful manner and shall not use to permit
the use of the Premises to
the Common Areas in any manner that will tend to
create waste or a nuisance or
shall tend to disturb other occupants of the
Office Building
Project.
6.3 Condition of Premises.
(a) Lessor shall
deliver the Premises of Lessee in a clean condition
on the Lease Commencement
Date (unless Lessee is already in possession) and
Lessor warrants to Lessee
that the plumbing, lighting, air conditioning, and
heating system in the
Premises shall be in good operating condition. In the
event that it is determined
that this warranty has been violated, then it shall
be the obligation of Lessor,
after receipt of written notice from Lessee setting
forth with specificity the
nature of the violation, to promptly, at Lessor's
sole cost, rectify such
violation.
(b) Except as
otherwise provided in this Lease, Lessee hereby accepts
the Premises and the Office
Building Project in their condition existing as of
the Lease Commencement Date
or the date that Lessee takes possession of the
Premises, whichever is
earlier, subject to all applicable zoning, municipal,
county and state laws,
ordinances and regulations governing and regulating the
use of the Premises, and any
easements, covenants or restrictions of record, and
accept this Lease subject
thereto and to all matters disclosed thereby and by
any exhibits attached hereto.
Lessee acknowledges that it has satisfied itself
by its own independent
investigation that the Premises are suitable for its
intended use, and that
neither Lessor nor Lessor's agent or agents has made any
representation or warranty as
to the present or future suitability of the
Premises, Common Areas, or
Office Building Project for the conduct of Lessee's
business.
7. Maintenance, Repairs,
Alteration, and Common Area Services.
7.1 Lessor's Obligations. Lessor shall
keep the Office Building Project,
including exterior walls,
roof, and common areas, and the equipment whether used
exclusively for the Premises
or in common with other premises. In good condition
and repair; provided,
however, Lessor shall not be obligated to paint, repair
or
replace wall coverings, or to
repair or replace any improvements that are not
ordinarily a part of the
Building or are above then Building standards. Except
as provided in paragraph 9.5,
there shall be no abatement of rent or liability
of Lessee on account of any
injury or interference with Lessee's business with
respect to any improvements,
alterations or repairs made by Lessor to the Office
Building Project or any part
thereof. Lessee expressly waives the benefits of
any statute now or hereafter
in effect which would otherwise afford Lessee the
right to make repairs at
Lessor's expense or to terminate this Lease because of
Lessor's failure to keep the
Premises in good order, condition and repair.
7.2 Lessee's Obligations.
(a) Notwithstanding
Lessor's obligation to keep the Premises in good
condition and repair, Lessee
shall be responsible for payment of the cost
thereof to Lessor as
additional rent for that portion of the cost of any
maintenance and repair of the
Premises, or any equipment (wherever located) that
serves only Lessee or the
Premises, to the extent such cost is attributable to
causes beyond normal wear and
tear. Lessee shall be responsible for the cost of
painting, repairing or
replacing wall coverings, and to repair or replace any
Premises improvements that
are not ordinarily a part of the Building or that are
above then Building
standards. Lessor may, at its option, upon reasonable
notice, elect to have Lessee
perform any particular such maintenance to repairs
the cost of which is
otherwise Lessee's responsibility hereunder.
(b) On the last day of
the term hereof, or on any sooner termination.
Lessee shall surrender the
Premises to Lessor in the same condition as received,
ordinary wear and tear
excepted, clean and free of debris. Lessee shall repair
any damage to the Premises
occasioned by the installation or removal of Lessee's
trade fixtures, alterations,
furnishings and equipment. Except as otherwise
stated in this Lease, Lessee
shall leave the air lines, power panels, electrical
distribution systems,
lighting fixtures, air conditioning, window coverings,
wall coverings, carpets, wall
panelling, ceilings and plumbing on the Premises
and in good operating
condition.
7.3 Alterations and
Additions.
(a) Lessee shall not,
without Lessor's prior written consent make any
alterations, improvements,
additions, Utility installations or repairs in, on or
about the Premises, or the
Office Building Project. As used in this paragraph
7.3 the term "Utility
installation" shall mean carpeting, window and wall
coverings, power panels,
electrical distribution systems, lighting fixtures, air
conditioning, plumbing, and
telephone and telecommunication wiring and
equipment. At the expiration
of the term, Lessor may require the removal of any
or all of said alterations,
improvements, additions or Utility Installations,
and the restoration of the
Premises and the Office Building Project to their
prior condition, at Lessee's
expense. Should Lessor permit Lessee to make its
own alterations,
improvements, additions or Utility Installations, Lessee
shall
use only such contractor as
has been expressly approved by Lessor, and Lessor
may require Lessee to provide
Lessor, at Lessee's sole cost and expense, a lien
and completion bond in an
amount equal of one and one-half times the estimated
cost of such improvements, to
insure Lessor against any liability for mechanic's
and materialmen's liens and
to insure completion of the work. Should Lessee
make any alterations,
improvements, additions to Utility Installations without
the prior approval of Lessor,
to use a contractor not expressly approved by
Lessor. Lessor may, at any
time during the term of this Lease, require that
Lessee remove any part or all
of the same. Lessee may make cosmetic,
non-structural alterations
without Lessor's consent.
(b) Any alterations,
improvements, additions or Utility Installations
in or about the Premises or
the Office Building Project that Lessee shall desire
to make shall be presented to
Lessor in written form, with proposed detailed
plans. If Lessor shall give
its consent to Lessee's making such alteration,
improvement, addition or
Utility Installation, the consent shall be deemed
conditioned upon Lessee
acquiring a permit to do so from the applicable
governmental agencies,
furnishing a copy thereof to Lessor prior to the
commencement of the work, and
compliance by Lessee with all conditions of said
permit in a prompt and
expeditious manner.
(c) Lessee shall pay,
when due, all claims for labor or materials
furnished to alleged of have
been furnished to or for Lessee at or for use in
the Premises, which claims
are or may be secured by any mechanic's or
materialmen's lien against
the Premises, the Building or the Office Building
Project, or any interest
therein.
(d) Lessee shall give
Lessor not less than ten (10) days' notice
prior to the commencement of
any work in the Premises by lessee and Lessor shall
have the right to post
notices of non-responsibility in or on the Premises or
the Building as provided by
law. If Lessee shall, in good faith, contest the
validity of any such lien,
claim or demand, then Lessee shall, at its sole
expense defend itself and
Lessor against the same and shall pay and satisfy any
such adverse judgment that
may be rendered thereon before the enforcement
thereof against the Lessor or
the Premises, the Building or the Office Building
Project, upon the condition
that if Lessor shall require, Lessee shall furnish
to Lessor a surety bond
satisfactory to Lessor in an amount equal to such
contested lien claim or
demand indemnifying Lessor against liability for the
same and holding the
Premises, the Building and the Office Building Project
free
from the effect of such lien
or claim. In addition, Lessor may require Lessee to
pay Lessor's reasonable
attorneys fees and costs in participating in such action
if Lessor shall decide it is
to Lessor's best interest so to do.
(e) All alterations,
improvements, additions and Utility
Installations (whether or not
such Utility Installations constitute trade
fixtures of Lessee), which
may be made to the Premises by Lessee, including but
not limited to, floor
coverings, panelings, doors, drapes, built-ins,
moldings,
sound attenuation, and
lighting and telephone to communication systems,
conduit,
wiring and outlets, shall be
made and done in a good and workmanlike manner and
of good and sufficient
quality and materials and shall be the property of
Lessor
and remain upon and be
surrendered with the Premises at the expiration of the
Lease term, unless Lessor
requires their removal pursuant to paragraph 7.3(a).
Provided Lessee is not in
default, notwithstanding the provisions of this
paragraph 7.3(e), Lessee's
personal property and equipment, other than that
which is affixed to the
Premises so that it cannot be removed without material
damage to the Premises or the
Building, and other than Utility Installations,
shall remain the property of
Lessee and may be removed by Lessee subject to the
provisions of paragraph
7.2.
(i) Lessee shall
provide Lessor with as-built plans and
specifications for any
alterations, improvements, additions or Utility
Installations.
<PAGE>
7.4 Utility Additions. Lessor reserves
the right of install new or
additional utility facilities
throughout the Office Building Project for the
benefit of Lessor or Lessee
or any other lessee of the Office Building Project,
including, but not by way of
limitation, such utilities as plumbing, electrical
systems, security systems,
communication systems, and fire protection and
detection systems, so long as
such installations do not unreasonably interfere
with Lessee's use of the
Premises.
8. Insurance;
Indemnity.
8.1 Liability Insurance-Lessee. Lessee
shall, at Lessee's expense, obtain
and keep in force during the
term of this Lease a policy of commercial General
Liability insurance utilizing
an insurance Services Office standard form with
Broad Form General Liability
Endorsement (GL0404), or equivalent, in an amount
of not less than $1,000,000
per occurrence of bodily injury and property damage
combined or in a greater
amount as reasonably determined by Lessor and shall
insure Lessee with Lessor as
an additional insured against liability arising out
of the use, occupancy or
maintenance of the Premises. Compliance with the above
requirement shall not,
however, limit the liability of Lessee hereunder.
8.2 Liability Insurance-Lessor. Lessor
shall obtain and keep in force
during the term of this Lease
a policy of Combined Single Limit Bodily injury
and Broad Form Property
Damage Insurance, plus coverage against such other risks
Lessor deems advisable from
time to time, insuring Lessor, but not Lessee,
against liability arising out
of the ownership, use occupancy or maintenance of
the Office Building Project
in an amount not less than $5,000,000.00 per
occurrence.
8.3 Property Insurance-Lessee. Lessee
shall at Lessee's expense, obtain
and keep in force during the
term of this Lease for the benefit of Lessee,
replacement cost fire and
extended coverage insurance, with vandalism and
malicious mischief, sprinkler
leakage and earthquake sprinkler leakage
endorsements, in an amount
sufficient to cover not less than 100% of the full
replacement cost, as the same
may exist from time to time, of all of Lessee's
personal property, fixtures,
equipment and tenant improvements.
8.4 Property Insurance-Lessor. Lessor
shall obtain and keep in force
during the term of this Lease
a policy to policies of insurance covering loss or
damage to the Office Building
Project improvements, but not Lessee's personal
property, fixtures, equipment
or tenant improvements. In the amount of the full
replacement cost thereof, as
the same may exist from time of time, Utilizing
Insurance Services Office
standard form or equivalent, providing protection
against all perils included
within the classification of fire, extended
coverage, vandalism,
malicious mischief, plate glass, and such other perils
as
Lessor deems advisable to may
be required by a lender having a lien on the
Office Building Project. In
addition, Lessor shall obtain and keep in force,
during the term of this
Lease, a policy of rental value insurance covering a
period of one year, with loss
payable of Lessor, which insurance shall also
cover all Operating Expenses
for said period. Lessee will not be named in any
such policies carried by
Lessor and shall have no right to any proceeds
therefrom. The policies
required by these paragraphs 8.2 and 8.4 shall contain
such deductibles as Lessor or
the aforesaid lender may determine. In the event
that the Premises shall
suffer an insured loss as defined in paragraph 9.1(f)
hereof, the deductible
amounts under the applicable insurance policies shall be
deemed an Operating Expense.
Lessee shall not do or permit to be done anything
which shall invalidate the
insurance policies carried by Lessor. Lessee shall
pay the entirety of any
increase in the property insurance premium for the
Office Building Project over
what it was immediately prior to the commencement
of the term of this Lease if
the increase is specified by Lessor's insurance
carrier as being caused by
the nature of Lessee's occupancy to any act or
omission of
Lessee.
8.5 Insurance Policies. Lessee shall
deliver to Lessor copies of liability
insurance policies required
under paragraph 8.1 or certificates evidencing the
existence and amounts of such
insurance within seven (7) days after the
Commencement Date of this
Lease. No such policy shall be cancellable or subject
to reduction of coverage to
other modification except after thirty (30) days
prior written notice to
Lessor. Lessee shall, at least thrity (30) days prior to
the expiration of such
policies, furnish Lessor with renewals thereof.
8.6 Waiver of Subrogation. Lessee and
Lessor each hereby release and
relieve the other, and waive
their entire right of recovery against the other,
for direct to consequential
loss to damage arising out of or incident to the
perils covered by property
insurance carried by such party, whether due to the
negligence of Lessor to
Lessee to their agents, employees, contractors and/or
invitees. If necessary all
property insurance policies required under this Lease
shall be endorsed to so
provide.
8.7 Indemnity. Lessee shall indemnify
and hold harmless Lessor and its
agents. Lessor's master to
ground lessor, partners and lenders, from and against
any and all claims for damage
of the person or property of anyone or any entity
arising from Lessee's use of
the Office Building Project, or from the conduct of
Lessee's business or from any
activity, work or things done, permitted or
suffered by Lessee in or
about the Premises to else where and shall further
indemnify and hold harmless
Lessor from and against any and all claims, costs
and expenses arising from any
breach or default in the performance of any
obligation on Lessee's part
to be performed under the terms of this Lease, or
arising from any act or
omission of Lessee, or any of Lessee's agents,
contractors, employees or
invitees and from and against all costs, attorney's
fees, expenses and
liabilities incurred by Lessor as the result of any such
use,
conduct, activity, work,
things done, permitted or suffered, breach, default or
negligence, and in dealing
reasonably therewith, including but not limited to
the defense or pursuit of any
claim or any action or proceeding involved
therein; and in case any
action to proceeding be brought against Lessor by
reason of any such matter.
Lessee upon notice from Lessor shall defend the same
at Lessee's expense by
counsel reasonably satisfactory to Lessor and Lessor
shall cooperate with Lessee
in such defense. Lessor need not have first paid any
such claim in order to be so
indemnified. Lessee, as a material part of the
consideration of Lessor,
hereby assumes all risk of damage to property of Lessee
or injury to persons. In upon
or about the Office Building Project arising
from any, cause and Lessee
hereby waives, all claims in respect thereof against
Lessor, excluding gross
negligence to willful misconduct of Lessor, its
employees, contractors and
agents.
8.8 Exemption of Lessor from
Liability. Lessee hereby agrees that Lessor
shall not be liable for
injury to Lessee's business or any loss of income
therefrom or for loss of or
damage to the goods, wares, merchandise to other
property of Lessee, Lessee's
employees, invitees, customers, or any other person
in or about the Premises or
the Office Building Project, nor shall Lessor be
liable for injury to the
person of Lessee, Lessee's employees, agents or
contractors, whether such
damage or injury is caused by or results from theft,
fire, steam, electricity,
gas, water or rain, or from the breakage, leakage,
obstruction or other defects
of pipes, sprinklers, wires, appliances, plumbing,
air conditioning to lighting
fixtures, or from any other cause, whether said
damage or injury results from
conditions arising upon the Premises or upon other
portions of the Office
Building Project, or from other sources or places, or
from new construction or the
repair, alteration or improvement of any part of
the Office Building Project,
or of the equipment, fixtures or appurtenances
applicable thereto, and
regardless of whether the cause of such damage or injury
or the means of repairing the
same is inaccessible, Lessor shall not be liable
for any damages arising from
any act to neglect of any other lessee, occupant or
user of the Office Building
Project, nor from the failure of Lessor to enforce
the provisions of any other
lease of any other lessee of the Office Building
Project.
8.9 No Representation of Adequate
Coverage. Lessor makes no representation
that the limits or forms of
coverage of insurance specified in this paragraph 8
are adequate of cover
Lessee's property or obligations under this Lease.
9. Damage to
Destruction.
9.1 Definitions.
(a) "Premises Damage"
shall mean if the Premises are damaged or
destroyed to any
extent.
(b) "Premises Building
Partial Damage" shall mean if the Building of
which the Premises are a part
is damaged to destroyed to the extent that the
cost of repair is less than
fifty percent (50%) of the then Replacement Cost of
the Building.
(c) "Premises Building
Total Destruction" shall mean if the Building
of which the Premises are a
part is damaged or destroyed to the extent that
the cost to repair is fifty
percent (50%) to more of the then Replacement Cost
of the Building.
(d) "Office Building
Project Buildings" shall mean all of the
buildings on the Office
Building Project site.
(e) "Office Building
Project Buildings Total Destruction" shall mean
if the Office Building
Project Buildings are damaged or destroyed to the extent
that the cost of repair is
fifty percent (50%) to more of the then Replacement
Cost of the Office Building
Project Buildings.
(f) "Insured Loss"
shall mean damage or destruction which was caused
by an event required to be
covered by the insurance described in paragraph 8.
The fact that an insured Loss
has a deductible amount shall not make the loss an
uninsured loss.
(g) "Replacement Cost"
shall mean the amount of money necessary to be
spent in order to repair or
rebuild the damaged area to the condition that
existed immediately prior to
the damage occurring, excluding all improvements
made by lessees, other than
those installed by Lessor at Lessee's expense.
9.2 Premises Damage; Premises Building
Partial Damage.
(a) Insured Loss:
Subject to the provisions of paragraphs 9.4 and
9.5, if at any time during
the term of this Lease there is damage which is an
insured Loss and which falls
into the classification of either Premises Damage
or Premises Building Partial
Damage, then Lessor shall, as soon as reasonably
possible and to the extent
the required materials and labor are readily
available through usual
commercial channels, at Lessor's expense, repair such
damage (but not Lessee's
fixtures, equipment or tenant improvements originally
paid for by Lessee) to its
condition existing at the time of the damage, and
this Lease shall continue in
full force and effect.
(b) Uninsured Loss:
Subject to the provisions of paragraphs 9.4 and
9.5, if at any time during
t
