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3. Contract Renewal. City and Contractor shall retain the right to renew the Contract for additional one year periods up to, but not exceeding, two (2) additional years following the initial two year contract for a total of four years. This Contract may be renewed only by mutual agreement between the parties. Each party retains the right to not renew the agreement at the time of its annual review. If the parties agree that the terms shall continue, the base Contract amount shall be increased annually based on the percentage change in the Consumer Price Index for All Urban Consumers / All Items / San Francisco- Oakland-San Jose with May 2016 the base month. The only item that shall be subject to negotiation is the following: a) additional items of work. 4. Method of Payment. Progress Payments—As of the twentieth day of each month, Contractor may submit for review a request for progress payment, listing the amount and value of work actually performed during the preceding month, or part thereof. Upon the Assistant Director's review and approval, including adjustments if any, City shall make a progress payment to the Contractor. 5. Indemnification. Contractor shall indemnify, save and hold harmless from and defend the City, members of the City Council and their agents and employees, against any and all claims, costs, demands, causes of action, suits, losses, expense or other detriment or liability arising from or out of acts or omissions of Contractor, its agents, sub-contractors, officials or employees, in connection with the execution of the work covered by this Contract or any amendments thereto. 6. Certification re: Workers' Compensation. In accordance with Section 1861 of the California Labor Code, each contractor to whom a public works contract is awarded shall sign and file with the awarding body the following certification prior to performing the work of the contract: "I am aware of the provisions of Section 3700 of the Labor Code which require every employer to be insured against liability for workers' compensation or to undertake self-insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of this contract." 7. Independent Contractor. The Contractor is an independent contractor retained by the City to perform the work described herein. All personnel employed by the Contractor, including subcontractors, and personnel of said subcontractors, are not and shall not be employees of the City. 8. Warranty Against Defects. Contractor hereby warrants all work done under this contract against all defects in materials and workmanship for a period of 12 months following City's acceptance of said work. If any defects occur within said 12 months, Contractor shall be solely responsible for the correction of those defects. 2