§ 6. Indemnification and Insurance.

6.1

Indemnification. The City shall in no way be liable or responsible for any loss or damage to property or for any injury to, or death of, any person that may occur in the construction, operation or maintenance by PacifiCorp of its Electric Facilities. PacifiCorp shall indemnify, defend and hold the City harmless from and against any claims, demands, liens and all liability or damage of whatsoever kind on account of PacifiCorp's use of the Public Ways within the City or PacifiCorp's failure to remove or relocate Electric Facilities in accordance with the Franchise. PacifiCorp shall pay the costs of defense plus reasonable attorneys' fees and costs, for any claim, demand or lien brought thereunder. The City shall: (a) give prompt written notice to PacifiCorp of any claim, demand or lien with respect to which the City seeks indemnification hereunder; and (b) permit PacifiCorp to assume the defense of such claim, demand, or lien. If such defense is not assumed by PacifiCorp, PacifiCorp shall not be subject to liability for any settlement made without its consent. Notwithstanding any provision herein to the contrary, PacifiCorp shall not be obligated to indemnify, defend or hold the City harmless to the extent any claim, demand or lien arises out of or in connection with any willful act or gross negligence of the City, its officers, agents or employees.

6.2

Insurance.

(A)

PacifiCorp shall maintain public liability and property damage insurance that protects the PacifiCorp and the City, as well as the City's officers, agents, and employees, from the claims referred to in Section 6.1 of this Franchise. The insurance shall provide coverage at all times of not less than $2,000,000 combined single limit for bodily injury liability and property damage liability per occurrence with an annual aggregate limit of not less than $4,000,000. The limits of the insurance shall be subject to any changes as to maximum constitutional and statutory limits of liability imposed on municipalities of the State of Oregon during the term of the Franchise. The insurance shall be without prejudice to coverage otherwise existing and shall name as additional insureds the City and its officers, agents, and employees. Notwithstanding the naming of additional insureds, the insurance shall protect each insured in the same manner as though a separate policy had been issued to each, but nothing herein shall operate to increase the insurer's liability as set forth elsewhere in the policy beyond the amount or amounts for which the insurer would have been liable if only one person or interest had been named as insured. The coverage must apply as to claims between insureds on the policy. The insurance shall provide that the insurance shall not be canceled or materially altered without thirty (30) days prior written notice first being given to the City and upon agreement of insurer of PacifiCorp. If the insurance is canceled or materially altered within the term of this Franchise, PacifiCorp shall provide a replacement policy with the same terms as provided within this Agreement. PacifiCorp agrees to maintain continuous uninterrupted coverage, in the terms and amounts required, for the duration of the Franchise. At PacifiCorp's option these insurance requirements may be satisfied by providing insurance, self-insurance, or a combination of both of these programs; however any change in PacifiCorp's insurance program shall require PacifiCorp to provide advance notice of the change and proof of insurance to City.

(B)

PacifiCorp shall maintain on file with the City a certificate of insurance certifying the coverage required above. The adequacy of the insurance shall be subject to the approval of the City. Failure to maintain liability insurance shall be cause for immediate termination of this Franchise by the City.

(C)

In the alternative to providing a certificate of insurance to the City certifying liability insurance coverage as required in Section 6.1(A), PacifiCorp may provide the City with an annual statement regarding its self-insurance. PacifiCorp's self-insurance shall provide at least the same amount and scope of coverage for PacifiCorp and the City, its officers, agents and employees, as otherwise required under Section 6.1(A). The adequacy of such self-insurance shall be subject to the City's review and approval. Upon PacifiCorp's election to provide self-insurance coverage under this Section 6.1(C), any failure by PacifiCorp to maintain adequate self-insurance may be cause for the City to declare a forfeiture or immediately terminate this Franchise.