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therefrom , which are alleged or proven to be caused in whole or in part by a negligent <br />act or omission of its officers, directors, and employees. This indemnification obligation <br />shall not apply in the limited circumstance where the claim, damage, loss and/or <br />expense is caused by the sole negligence of either party. <br />ARTICLE VII <br />PERFORMANCE OF AGREEMENT <br />7.01 Compliance with All Laws. Each party shall comply with all federal, state <br />and local laws, rules, regulations and ordinances applicable to the performance of this <br />Agreement, including without limitation all those pertaining to wages and hours, <br />confidentiality, disabilities and discrimination. <br />7.02 Maintenance and Audit of Records. Each party shall maintain books, <br />records, documents and other materials relevant to its performance under this <br />Agreement. These records shall be subject to inspection, review and audit by either <br />party or its designee, and the Washington State Auditor's Office. Each party shall <br />retain all such books, records, documents and other materials for the applicable <br />retention period under federal and Washington law . <br />7.03 On-Site Inspections. Either party or its designee may evaluate the <br />performance of this Agreement through on-site inspection to determine whether <br />performance is in compliance with the standards set forth in this Agreement, and in <br />compliance with federal, state and local laws, rules, regulations and ordinances. <br />7.04 Improper Influence. Each party agrees, warrants and represents that it <br />did not and will not employ, retain or contract with any person or entity on a contingent <br />compensation basis for the purpose of seeking, obtaining, maintaining or extending this <br />Agreement. Each party agrees, warrants and represents that no gratuity whatsoever <br />has been or will be offered or conferred with a view towards obtaining, maintaining or <br />extending this Agreement. <br />7.05 Conflict of Interest. The elected and appointed officials and employees of <br />the parties shall not have any personal interest, direct or indirect, which gives rise to a <br />conflict of interest. <br />ARTICLE VIII <br />DISPUTES <br />8.01 Waiver Limited. A waiver of any term or condition of this Agreement must <br />be in writing and signed by the waiving party. Any waiver of a term or condition of this <br />Agreement shall apply only to the specific act, occurrence or omission and shall not <br />constitute a waiver as to any other term or condition or future act, occurrence or <br />omission. <br />Page 3