THIS AGREEMENT, dated ______________________, is by and between the CITY OF SUNNYVALE, a municipal corporation ("CITY"), and Bid America, Inc. ("CONTRACTOR").

NOW, THEREFORE, THE PARTIES ENTER INTO THIS AGREEMENT.

1.

Services

(a)

There are attached and incorporated by this reference the following exhibits:

(1)

Exhibit "A", consisting of Pages 2 through 9, inclusive, of that certain document entitled "Request for Proposals No. F0205-70". The document consists of the Notice Inviting Proposals, Instructions to Proposers, Specifications, Terms and Conditions, and Proposal Format, which was submitted to all prospective proposers.

(2)

Exhibit "B", consisting of Pages 10 through 13, inclusive, of that certain document entitled "Proposer Response Pages" and its attachments, presenting the response to "Request for Proposals No. F0205-70 " as submitted to CITY by CONTRACTOR.

(b)

(c)

The term of the Agreement shall be three (3) years, beginning the date following the date of contract award by the Sunnyvale City Council, unless otherwise terminated. Agreement may be extended for two (2) additional one-year periods at the option of the City.

CITY agrees to pay CONTRACTOR as full compensation for the services rendered pursuant to this Agreement, the amounts set forth in Exhibit "B". CONTRACTOR shall submit all invoices for services to CITY in the manner specified in Exhibit "B".

No officer or employee of CITY shall have any interest, direct or indirect, in this Agreement or in the proceeds thereof. During the term of this Agreement, CONTRACTOR shall not accept an obligation which is inconsistent or incompatible with CONTRACTOR's obligations under this Agreement.

CONTRACTOR shall maintain in confidence and at no time use, except to the extent required to perform its obligations hereunder, any and all proprietary or confidential information of CITY of which CONTRACTOR may become aware in the performance of its services.

CONTRACTOR is acting as an independent contractor in performing the work required by this Agreement and is not an agent, servant or employee of CITY. Nothing in this Agreement shall be interpreted or construed as creating or establishing the relationship of employer and employee between CITY and CONTRACTOR. CONTRACTOR is responsible for paying all required state and federal taxes.

CONTRACTOR shall indemnify, defend and hold harmless CITY and its officers, officials, employees and volunteers from and against all claims, damages, losses and expenses, including attorney fees, arising out of the performance of the services described herein, caused in whole or in part by any negligent act or omission of CONTRACTOR, any subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable, except where caused by the active negligence, sole negligence, or willful misconduct of CITY.

CONTRACTOR shall take out and maintain during the life of this Agreement policies of insurance as specified on pages 7 and 8 of Exhibit "A", attached and incorporated by reference, and shall provide all certificates and/or endorsements as specified.

CITY's Superintendent of Buildings, as City Manager's authorized representative, shall represent CITY in all matters pertaining to the services to be rendered under this Agreement. All requirements of CITY pertaining to the services and materials to be rendered under this Agreement shall be coordinated through the CITY representative.

Jim Spalding shall represent CONTRACTOR in all matters pertaining to the services and materials to be rendered under this Agreement. All requirements of CONTRACTOR pertaining to the services to be rendered under this Agreement shall be coordinated through the CONTRACTOR representative.

All notices required by the Agreement shall be in writing, and shall be personally delivered or sent by first class mail, postage prepaid or by commercial courier, addressed as follows:

To CITY:

Superintendent of Buildings

CITY OF SUNNYVALE

P.O. BOX 3707

Sunnyvale

To CONTRACTOR:

Bid America, Inc.

Electronic Archiving Division

Attn: Jim Spalding

41085 Elm Street

Murrieta, CA 92562

Nothing in this provision shall be construed to prohibit communication by more expedient means, such as by telephone or facsimile transmission, to accomplish timely communication. However, to constitute effective notice, written confirmation of a telephone conversation or an original of a facsimile transmission must be sent by first class mail or commercial carrier, or hand delivered.

Each party may change the address by written notice in accordance with this paragraph. Notices delivered personally shall be deemed communicated as of actual receipt; mailed notices shall be deemed communicated as of three days after mailing, unless such date is a date on which there is no mail service. In that event communication is deemed to occur on the next mail service day.

13.

Neither party shall assign or sublet any portion of this Agreement without the prior written consent of the other party.

14.

If CONTRACTOR defaults in the performance of this Agreement, or materially breaches any of its provisions, CITY at its option may terminate this Agreement by giving written notice to CONTRACTOR. If CITY fails to pay CONTRACTOR, CONTRACTOR at its option may terminate this Agreement if the failure is not remedied by CITY within thirty (30) days from the date payment is due.

Without limitation to such rights or remedies as CITY shall otherwise have by law, CITY also shall have the right to terminate this Agreement for any reason upon ten (10) days' written notice to CONTRACTOR. In the event of such termination, CONTRACTOR shall be compensated for services performed through the date of receipt of notification from CITY to terminate. CONTRACTOR shall present CITY with any work product completed and shall return any and all CITY records in its possession at that point in time.

15.

This writing constitutes the entire agreement between the parties relating to the services to be performed or materials to be furnished hereunder. No modification of this Agreement shall be effective unless and until such modification is evidenced by writing signed by all parties.

16.

Time shall be of the essence in this Agreement. Failure on the part of either party to enforce any provision of this Agreement shall not be construed as a waiver of the right to compel enforcement of such provision or any other provision. This Agreement shall be governed and construed in accordance with the laws of the State of California.