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10 . HOLD HARMLESS . The parties agree to mutually indemnify and hold each other harmless for all claims , demands , or causes of action which may be asserted , prosecuted or established against them for injury to or death of persons , or loss of or damage to property of whatsoever nature arising out of this agreement , excepting , therefrom , however , any claim , demand or cause of action which arises out of the sole negligence of the party seeking indemnification or to be held harmless . For pur - poses of this paragraph , the term " party " or " parties " includes the officers , agents or employees of the COUNTY or CITY , as the case may be . 11 . MODIFICATION OF AGREEMENT . This agreement may be supplemented or amended by written agreement properly executed by CITY and COUNTY . 12 . COMPLIANCE WITH LAWS . CITY warrants that the construc - tion contract for the above facilities shall be let pursuant to the laws of the State of California and that insurance , including worker ' s compensation insurance , and bonds , including a faithful performance bond and a labor and materials bond , shall be required in an amount adequate to protect CITY and COUNTY against claims and liabilities of every nature arising out of the construction of said project up to the time of final completion and acceptance of said project . 13 . SEVERABILITY . If any section , subsection , sentence , clause , phrase or word of this agreement , or the application thereon , to either party , or to any other person or circumstances is for any reason held invalid , it shall be deemed severable and the validity of the remainder of the agreement of the application of such provision to the other party , or to any other persons or circumstance shall not be affected thereby . Each party hereby declares that it would have entered into this agreement and each section , subsection , sentence , clause , phrase and word herein , irrespective of the fact that one or more sections , subsections , sentences , clauses , phrases or words , or the application thereof to either party or any other person or circumstances be held invalid . 14 . TERM . This agreement- shall be effective upon execution of the parties , provided however , that the operation and main - tenance services of Clause 4 herein shall. become effective on July 1 , 1989 . 15 , NEGOTIATING FOR SALE . CITY or COUNTY may on or before July 11 1994 , reopen this agreement solely for the purpose of negotiating for the sale to CITY of the water facilities more particularly described in Exhibit " D " attached hereto together with improvements thereon . 4 -