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SECTION 9. Indemnity
<br />9.1 IN CONSIDERATION OF GRANTING OF THIS FRANCHISE, PEC AGREES TO INDEMNIFY,
<br />DEFEND, AND HOLD HARMLESS THE CITY, ITS OFFICERS, EMPLOYEES AND AGENTS
<br />FROM AND AGAINST ANY AND ALL CLAIMS, LOSSES, CAUSES OF ACTION BY OR ON
<br />BEHALF OF ANY PERSON, FIRM, CORPORATION OR OTHER ENTITY, TO THE EXTENT
<br />THEY ARISE OUT OF OR IN CONNECTION WITH PEC'S NEGLIGENCE OR WILLFUL
<br />MISCONDUCT, AND THAT OF ITS EMPLOYEES, AGENTS, CONTRACTORS, OR
<br />CONSULTANTS, IN CONNECTION WITH CONSTRUCTION, OPERATION, OR
<br />MANAGEMENT OF ITS TRANSMISSION AND DISTRIBUTION SYSTEM, AND FROM AND
<br />AGAINST ALL COSTS, REASONABLE ATTORNEYS OR EXPERT FEES, EXPENSES AND
<br />LIABILITIES INCURRED IN OR ABOUT ANY SUCH CLAIM OR PROCEEDING BROUGHT
<br />THEREON, AND FROM ANY AND ALL CLAIMS ARISING FROM ANY BREACH OR DEFAULT
<br />ON THE PART OF PEC IN THE PERFORMANCE OF ANY COVENANT OR AGREEMENT ON
<br />THE PART OF PEC TO BE PERFORMED PURSUANT TO THE TERMS OF THIS FRANCHISE
<br />AGREEMENT, PROVIDED, HOWEVER, THAT PEC SHALL NOT BE LIABLE FOR ANY SUIT,
<br />ACTIONS, LEGAL PROCEEDINGS, CLAIMS, DEMANDS, DAMAGES, COSTS, EXPENSES,
<br />AND ATTORNEYS' FEES ARISING OUT OF GROSS NEGLIGENCE OR WILLFUL
<br />MISCONDUCT OF THE CITY, ITS OFFICERS, AGENTS, SERVANTS OR EMPLOYEES.
<br />9.1.1 The City shall promptly notify PEC of any claim or cause of action which may be
<br />asserted against the City relating to or covering any matter against which PEC has
<br />agreed, as set forth above, to indemnify, defend or save harmless the City.
<br />9.1.2 PEC reserves the right, but not the obligation, to employ such attorneys, expert
<br />witnesses and consultants as it deems necessary to defend against the claim or cause of
<br />action.
<br />9.1.3 If PEC and the City are found to be jointly liable by a court of competent
<br />jurisdiction, liability shall be apportioned comparatively in accordance with the laws of
<br />Texas without, however, waiving any governmental immunity available to the City under
<br />state law and without waiving any defenses of the parties under state law.
<br />9.2 It is not the intention of either the City or PEC to create any liability, right, or claim for
<br />the benefit of third parties. This indemnification provision is intended and shall be
<br />construed for the sole benefit of the City and PEC.
<br />SECTION 10. Notice to City Regarding Sale of System or Substantial Part of the System
<br />During the term of this Franchise, or any renewal, extension, or amendment hereof, if the
<br />Board of PEC determines that it has received a "Qualified Offer" (as defined in the PEC Policy
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