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• C. Other. The non -renewal or termination payments provided for in this section shall not be considered as part of the Manager's base pay in computing the City's contribution to the Manager's retirement plan pursuant to Section 13 of this contract. SECTION 8. PERFORMANCE EVALUATION A. The City Council shall review and evaluate the performance of the Manager by May 1 of each year, beginning May 1, 2007. The review and evaluation shall be in accordance with specific written criteria to be developed jointly by the City Council and the Manager. B. Annually, during the term of this agreement and any renewals thereof, the City Council and Manager shall define goals and performance objectives for the proper operation of the City and the fulfillment of the Council's policies. They shall further establish priorities among those goals and objectives, which shall be agreed upon in writing by May 1 of each year of this agreement. C. As part of the goals and performance objectives defined pursuant to paragraph (B), the Manager and City Council shall identify, in writing, certain stretch objectives, or ambitious and challenging goals which will be difficult for the Manager to achieve but • which will have a significant and lasting positive effect on the City if accomplished. The Manager shall include these agreed-upon stretch objectives in his annual work plan and, during each subsequent performance evaluation, provide City Council with a written report on the status of his work towards those objectives. City Council may; in its discretion, award the Manager a one-time salary supplement in an amount up to 10% of his annual base salary for accomplishment, or for significant progress towards accomplishment, of any agreed-upon stretch objective. SECTION 9. HOURS OF WORK AND LIMITATIONS ON OTHER EMPLOYMENT It is recognized that the Manager must devote a great deal of time outside the normal office hours of the City, and to that end the Manager will be allowed periodically to take time off during normal office hours. The Manager may hold employment or operate business during non -duty hours, provided the employment or business does not cause a conflict of interest, does not reflect unfavorably upon the City service, does not impair the employee's ability to perform City duties, and is not performed in City facilities or with City supplies and equipment. The Manager shall inform City Council, by written notice to the Mayor, of any such outside employment at least thirty (30) days prior to the start of such employment. The Manager will take personal or vacation leave 0 4