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2. COMPENSATION a. City agrees to pay, and Contractor agrees to accept as total payment for its services, the rates and charges identified in Exhibit 8. The total sum to be expended under this Agreement shall not exceed $504,264.72, annually, during the term of this Agreement. This amount includes $90,000 for as needed services performed only at the City's written request. b. Payment by City shall be made within thirty (30) days following receipt of proper invoice evidencing work performed, subject to City accounting procedures. Payment need not be made for work which fails to meet the standards of performance set forth in the Recitals which may reasonably be expected by City. 3. TERM This Agreement shall commence on June 1, 2011 and terminate on May 31, 2013 unless terminated earlier in accordance with Section 12, below. The term of this Agreement may be extended for three successive twelve month periods upon a writing executed by the City Manager and the City Attorney. In the event the City Council does not budget sufficient funds to continue services for a new fiscal year, the City shall notify Contractor of such occurrence and shall terminate this Agreement on the last day of the fiscal period without penalty to City. 4. INDEPENDENT CONTRACTOR Contractor shall, during the entire term of this Agreement, be construed to be an independent contractor and not an employee of the City. This Agreement is not intended nor shall it be construed to create an employer-employee relationship, a joint venture relationship, or to allow the City to exercise discretion or control over the professional manner in which Contractor performs the services which are the subject matter of this Agreement; however, the services to be provided by Contractor shall be provided in a manner consistent with all applicable standards and regulations governing such services. Contractor shall pay all salaries and wages, employer's social security taxes, unemployment insurance and similar taxes relating to employees and shall be responsible for all applicable withholding taxes. 5. INSURANCE Prior to undertaking performance of work under this Agreement, Contractor shall maintain and shall require its subcontractors, if any, to obtain and maintain insurance as described below: a. Commercial General Liability Insurance. Contractor shall maintain commercial general liability insurance which shall include, but not be limited to protection against claims arising from bodily and personal injury, including death resulting therefrom and damage to property, resulting from any act or occurrence arising out of Contractor's operations in the performance of this Agreement, including, without limitation, acts involving vehicles. The amounts of insurance shall be not less than the following: single limit coverage applying to bodily and personal injury, including death resulting therefrom, and property damage, in the total amount of $1,000,000 per occurrence, $2,000,000 in the aggregate. Such insurance shall (a) name the City, its officers, employees, agents, volunteers and representatives as additional 25C-6