DRAFT

CONSULTANT SERVICE AGREEMENT
BETWEEN THE CITY OF SUNNYVALE AND
HIGH LINE CORPORATION FOR PAYROLL SYSTEM APPLICATION
UPGRADE AND IMPLEMENTATION SERVICES

THIS AGREEMENT dated ________________, 2002, is by and between the CITY OF SUNNYVALE, a municipal corporation ("CITY"), and HIGH LINE CORPORATION, a Canadian corporation ("CONSULTANT").

WHEREAS, CITY desires to secure professional services necessary for the upgrade and implementation of its human resources/payroll application; and

WHEREAS, CONSULTANT possesses the professional qualifications and expertise to provide the required services;

NOW, THEREFORE, THE PARTIES ENTER INTO THIS AGREEMENT.

CONSULTANT shall provide services in accordance with Exhibit "A" entitled "P2K Upgrade Cost Proposal" and Exhibit "B" entitled "Personality Implementation Plan". All exhibits referenced in this Agreement are attached and incorporated by reference. To accomplish that end, CONSULTANT assigns Brian Diamond, Director, Professional Services, to this project, to act in the capacity of Project Manager and personally direct the professional services to be provided by CONSULTANT.

2. Time for Performance

The term of this Agreement shall be from August 28, 2002 to June 30, 2003 unless otherwise terminated. CONSULTANT shall deliver the agreed upon services to CITY as specified in Exhibit "A" and Exhibit "B". CITY may grant extensions of time upon a showing of good cause.

3. Duties of CITY

CITY shall supply any documents or information available to City required by CONSULTANT for performance of its duties. Any materials provided shall be returned to CITY upon completion of the work.

4. Payment of Fees and Expenses

Payments shall be made to CONSULTANT based upon the completion of the milestones as set forth in Exhibit "A". In no event shall the total amount of compensation payable under this Agreement exceed the sum of One Hundred Seventy-Eight Thousand Two Hundred Fifty and 00/100 Dollars ($178,250). CONSULTANT shall submit invoices to CITY no more frequently than monthly for milestones completed. Payment shall be made within thirty (30) days of receipt of an accurate, itemized invoice by CITY’S Accounts Payable Unit.

5. Ownership of Documents

The rights of CITY and CONSULTANT to the software and documents relating to this Agreement shall be as stated in the Software License Agreement dated ___________, 2002 between CITY and HIGH LINE CORPORATION.

6. Conflict of Interest

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, CONSULTANT shall not accept employment or an obligation, which is inconsistent or incompatible with CONSULTANT’S obligations under this Agreement.

7. Confidential Information

All ideas, memoranda, specifications, plans, procedures, data, drawings, descriptions, documents, discussions or other information developed or received by or for CONSULTANT and all other written information submitted to CONSULTANT in connection with the performance of this Agreement shall be held confidential by CONSULTANT and shall not, without the prior written consent of CITY, be used for any purposes other than the performance of the Project services, nor be disclosed to an entity not connected with the performance of the Project services. Nothing furnished to CONSULTANT which is otherwise known to CONSULTANT or is or becomes generally known to the related industry shall be deemed confidential.

8. Compliance with Laws

1. CONSULTANT shall strictly adhere to all state and federal laws with respect to discrimination in employment and shall not discriminate against any individual on the basis of race, color, religion, gender, sexual orientation, marital status, national origin, age or disability.

(b) CONSULTANT shall comply with all federal, state and city laws, statutes, ordinances, rules and regulations and the orders and decrees of any courts or administrative bodies or tribunals in any manner affecting the performance of the Agreement.

CONSULTANT is acting as an independent contractor in furnishing the services or materials and 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 CONSULTANT. CONSULTANT is responsible for paying all required state and federal taxes.

10. Indemnity

CONSULTANT agrees to indemnify defend and hold harmless CITY and its officers, officials, employees and volunteers from and against claims, damages, losses and expenses, including attorney fees, arising out of the performance of the work described herein, caused in whole or in part by any negligent act or omission of CONSULTANT, 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.

11. Insurance

CONSULTANT shall take out and maintain during the life of this Agreement policies of insurance as specified in Exhibit "C" attached and incorporated by reference, and shall provide all certificates and endorsements as specified in Exhibit "C".

12. CITY Representative

Cheryl Bunnell, as the 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.

13. CONSULTANT Representative

Brian Diamond shall represent CONSULTANT in all matters pertaining to the services and materials to be rendered under this Agreement. All requirements of CONSULTANT pertaining to the services or materials to be rendered under this Agreement shall be coordinated through the CONSULTANT representative.

14. Notices

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

To CITY:

Cheryl Bunnell, Manager, Applications Development
Department of Information Technology
CITY OF SUNNYVALE
P.O. Box 3707
Sunnyvale, CA 94088-3707

 To CONSULTANT:

Brian Diamond, Director, Professional Services
HIGH LINE CORPORATION
823 Alvarado Road
Berkeley, CA 94705

Nothing in this provision shall be construed to prohibit communication by more expedient means, such as by telephone, facsimile transmission or electronic mail, 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 two 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.

15. Assignment

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

16. Termination

If CONSULTANT 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 CONSULTANT. If CITY fails to pay CONSULTANT, CONSULTANT 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 CONSULTANT. In the event of such termination, CONSULTANT shall be compensated in proportion to the percentage of services performed or materials furnished (in relation to the total which would have been performed or furnished) through the date of receipt of notification from CITY to terminate. CONSULTANT shall present CITY with any work product completed at that point in time.

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.

Miscellaneous

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. CONSULTANT shall not be responsible for delay or damages or be in default or deemed to be in default by reason of strikes, lockouts, accidents, or acts of God, or the failure of CITY to furnish timely information or to approve or disapprove CONSULTANT’S work promptly, or delay or faulty performance by CITY, other contractors, or governmental agencies, or any other delays beyond CONSULTANT’S control or without CONSULTANT’S fault. This Agreement shall be governed and construed in accordance with the laws of the State of California.

IN WITNESS WHEREOF, the parties have executed this Agreement.

ATTEST:

By______________________________
City Clerk

APPROVED AS TO FORM:

By______________________________
City Attorney

CITY OF SUNNYVALE ("CITY")

By_______________________________
City Manager

HIGHLINE CORPORATION
("CONSULTANT")

By______________________________
Name and Title

By______________________________
Name and Title