{"id":42186,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/contract-for-turnkey-design-build-construction-and-related.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"contract-for-turnkey-design-build-construction-and-related","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/operations\/contract-for-turnkey-design-build-construction-and-related.html","title":{"rendered":"Contract for Turnkey Design\/Build Construction and Related Services – Webvan Group Inc. and Bechtel Corp."},"content":{"rendered":"\n CONTRACT\n\n FOR\n\n TURNKEY DESIGN\/BUILD\n\n CONSTRUCTION AND RELATED SERVICES\n\n between\n\n WEBVAN GROUP, INC.\n\n and\n\n BECHTEL CORPORATION\n\n\n\n 2\n\n CONTRACT\n\n FOR\n\n TURNKEY DESIGN\/BUILD\n CONSTRUCTION AND RELATED SERVICES\n\n\nTHIS CONTRACT (\"CONTRACT\") is dated the 8th day of July, 1999, for reference\npurposes only, by and between Webvan Group, Inc. (formerly known as Intelligent\nSystems for Retail, Inc.), a California corporation (\"WEBVAN\"), and Bechtel\nCorporation, a Nevada corporation (\"BECHTEL\").\n\n\n1.0 THE PROJECT\n\n 1.1 The project (\"PROJECT\") consists of the location, selection,\nevaluation, design, development, construction, start-up and testing of up to\ntwenty-six (26) distribution center warehouse facilities (\"DC'S\") to be located\nin various cities to be determined by Webvan throughout the United States and\nthe design, engineering, procurement, assembly, installation, start-up, testing\nand calibration of materials handling and distribution equipment and systems and\nall other materials, equipment and systems (including, without limitation, food\nproduction, refrigeration and specialized heating, ventilation and air\nconditioning equipment and systems) necessary for the operation of each DC in\nthe manner specified in the applicable Contract Documents (defined in Section\n2.5) (collectively, the \"OPERATING EQUIPMENT\"). The provision of all such\nservices with respect to any DC is referred to herein as the \"DEVELOPMENT\" of a\nDC. The Development of any particular DC is referred to herein as a \"DC\nPROJECT\".\n\n 1.2 Each DC Project will be described more particularly in the\ndrawings, plans and specifications to be prepared by Bechtel. Webvan, however,\nshall be solely responsible for the design and installation of [*]\n(collectively, the \"WEBVAN Systems\"). Prior to Substantial Completion (defined\nin Section 2.5), but after Bechtel has assembled and installed all Operating\nEquipment for a DC Project, Bechtel shall notify Webvan that the materials\nhandling and distribution system at such DC is ready for start-up testing. No\nlater than ten (10) days after Webvan's receipt of such notice, Webvan shall\ninstall the Webvan Systems [*] at such DC and shall conduct such testing as\nreasonably required to confirm that each item (both individually and in concert\nwith other items) of the materials handling and distribution equipment and\nsystems installed at the DC meets the applicable functionality specifications\nprovided in the Contract Documents for such DC Project and to confirm that such\nmaterials handling and distribution system properly operates at the volume and\nthrough-puts specified in the Notice to Proceed for such DC Project\n(collectively, the \"PERFORMANCE STANDARDS\").\n\n 1.3 The term of this Contract shall commence as of the Effective Date\n(defined in Section 8.12) and shall expire on the third (3rd) anniversary of the\nEffective Date, unless extended by the written agreement of Webvan and Bechtel.\nNotwithstanding the expiration of the term of this Contract, Bechtel shall\ncontinue thereafter to perform all Services (defined in Section 2.0) to achieve\nFinal Completion (defined in Section 3.2) of all DC Projects for which a Notice\nto Proceed (defined in Section 2.0) has been executed in accordance with the\napplicable Contract Documents (defined in Section 2.5).\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 1\n 3\n\n2.0 BECHTEL'S SERVICES\n\nWhen requested by Webvan, Bechtel shall perform or cause to be performed for the\nProject the services and items generally described below (collectively, the\n\"SERVICES\"). Notwithstanding anything to the contrary in this Contract, Bechtel\nshall not perform any of the Services unless and until a fully executed notice\nto proceed (\"NOTICE TO PROCEED\") for specified Services in the form attached\nhereto as Appendix 2.0 has been entered by Webvan and Bechtel, and Webvan shall\nhave no obligation to pay for any Services performed by Bechtel which are not\nspecifically authorized in a Notice to Proceed executed by Webvan. All Services\nperformed by Bechtel for the Project shall be classified as within one or more\nof Sections 2.1 through 2.7 of this Section 2.0.\n\n2.1 Program Management.\n\nBased on Webvan's program and criteria for the Project, Bechtel shall prepare\nand submit for Webvan's approval a \"DEVELOPMENT PLAN\" (which shall initially be\nbased upon Webvan's existing DCs located in Oakland, California and Atlanta,\nGeorgia) of preliminary proposals and recommendations regarding Project concept,\ndevelopment strategy, architectural and design concepts, space requirements and\nadjacency relationships, number and functional responsibilities of personnel,\nspecial equipment and systems, human and material flow patterns, governmental\napproval strategies, construction schedule requirements, construction budget\nrequirements, and other matters regarding the Development of the DC Projects,\nincluding, but not limited to:\n\n 2.1.1 Preparation of a preliminary assessment of the Project budget\ntaking into account the activities contemplated for the Project.\n\n 2.1.2 Consultation with Webvan's independent consultants and Webvan\nconcerning the Project and development of Project plans, drawings and\nspecifications.\n\n 2.1.3 Assistance with utility optimization and sourcing, as requested,\nto develop alternative methods to reduce utility costs and ongoing operation of\nDC's.\n\n 2.1.4 Development of cost control systems for the Project, including\nregular monitoring of actual costs for activities in progress and estimates for\nuncompleted tasks.\n\n 2.1.5 Development of milestone completion dates for the Project.\n\n2.2 Site Evaluation and Selection. As and when requested by Webvan:\n\n 2.2.1 Provide building and site evaluation to review physical plants and\nproperties and to assess and compare alternative DC sites.\n\n 2.2.2 Ascertain as to a proposed DC Project whether there are any\nsignificant zoning, building code, entitlement or other governmental compliance\nissues (including transportation issues), prepare a plan for addressing any such\nissues, and assist Webvan in addressing such issues, including, without\nlimitation, Bechtel's development of an entitlement strategy for obtaining such\napprovals as are required from governmental authorities to develop each DC\nProject within the time frame and costs contemplated by the Project Schedule and\nProject Budget (as each is defined below) for a DC Project, coordination of all\ndevelopment requirements of applicable governmental authorities, and making such\nappearances and attending such meetings as are necessary or appropriate in\nconnection with obtaining required permits and approvals.\n\n\n 2\n 4\n\n 2.2.3 Assist Webvan in conducting inspections, evaluations, surveys and\ntests as may be necessary or appropriate in connection with any DC Project,\nincluding, without limitation, such engineering and geotechnical studies,\nseismic tests, and inspections and reviews of all buildings and related\noperating systems to determine the feasibility of a DC Project. Bechtel shall\nnot be required, however, to perform any testing or analysis to determine the\npresence or extent of any hazardous materials at the DC Projects.\n\n 2.2.4 Bechtel's liability for any deficient Services provided under this\nSection 2.2 shall be limited to the reperformance of such Services during the\nterm of this Contract at no additional charge to Webvan.\n\n2.3 Design.\n\n 2.3.1 Schematic Design Services.\n\n 2.3.1.1 Based on the approved Development Plan for each of the DC\nProjects and any adjustments authorized by Webvan in such Development Plan,\nBechtel shall prepare for Webvan's review and approval schematic drawings,\ndescriptive specifications and other documents appropriate to the size of each\nof the DC Projects illustrating and describing the concept, quality, layout,\nscale and relationship of the DC Project components (including, without\nlimitation, the Operating Equipment), which documents are collectively referred\nto as the \"SCHEMATIC DESIGN DOCUMENTS\". Webvan acknowledges that the conceptual\ndesign of the DC Projects shall initially be based upon Webvan's existing DCs\nlocated in Oakland, California and Atlanta, Georgia. Bechtel shall, however,\nreview with Webvan alternative designs and construction methods relating to each\nDC Project.\n\n 2.3.1.2 Upon completion of the Schematic Design Documents for a DC\nProject, Bechtel shall prepare and submit to Webvan a comprehensive, detailed\npreliminary budget for such DC Project and for all costs to be incurred as part\nof the DC Project, which budget shall at all times be subject to Webvan's\napproval both as to form and content. The parties acknowledge that such DC\nProject budgets will be critical in allowing the parties to conceptualize and\nmonitor the Development of the Project, and Bechtel shall use its best efforts\nto prepare and update each such DC Project budget so as to be as detailed and\nrealistic as possible. Each such DC Project budget, as revised from time to time\nand approved by Webvan, is referred to herein as a \"PROJECT BUDGET\". Bechtel\nshall design each DC Project in accordance with its Project Budget.\n\n 2.3.2 Design Development Services.\n\n 2.3.2.1 Based on the approved Schematic Design Documents for each\nDC Project and any adjustments authorized by Webvan in the Development Plan or\nthe Project Budget for such DC Project, Bechtel shall prepare for Webvan's\nreview and approval drawings of sufficient detail to describe the size, shape,\nconfiguration, and quantity of typical and non-typical elements of each such DC\nProject (including, without limitation, the Operating Equipment), outline\nspecifications and other documents which fix and describe the size and character\nof the DC Project as to architecture, engineering, structure, layout, electrical\nsystems, mechanical systems, plumbing systems, materials and equipment\n(including the Operating Equipment), all of which documents are collectively\nreferred to herein as the \"DESIGN DEVELOPMENT DOCUMENTS\".\n\n 2.3.2.2 Bechtel shall refine the Project Budget for each DC\nProject based on the Design Development Documents for such DC Project. Bechtel\nshall revise the Design Development \n\n\n\n 3\n 5\n\nDocuments as required by Webvan to make them acceptable to Webvan and shall\nadjust the Project Budget for such DC Project accordingly.\n\n 2.3.3 Construction Documents Services.\n\n 2.3.3.1 Based on the Design Development Documents approved by\nWebvan for each DC Project and the approved Project Budget for each such DC\nProject, Bechtel shall prepare the final drawings, plans and specifications\nsetting forth in detail the requirements for Development of each such DC\nProject, collectively referred to herein as the \"CONSTRUCTION DOCUMENTS\". The\nConstruction Documents shall include the detailed Performance Standards for the\noperation of the materials handling and distribution system and equipment\nincluded within such DC Project.\n\n 2.3.3.2 Bechtel shall revise the Construction Documents as\nrequired by Webvan to make them acceptable to Webvan and shall adjust the\nProject Budget for each such DC Project accordingly.\n\n 2.3.3.3 Bechtel shall complete the Construction Documents for each\nDC Project, including Bechtel's coordination of all documents and corrections\nbased on such coordination, prior to preparing and issuing bid documents for\neach such DC Project.\n\n 2.3.3.4 Bechtel shall submit all necessary Construction Documents\napproved by Webvan and applications for all necessary permits and approvals for\nthe Development of each DC Project to the appropriate governmental authorities\nand shall process such Construction Documents, subject to the terms of this\nContract, as required by such governmental authorities to secure the issuance of\nsuch permits and approvals for the use and occupancy of each DC Project.\n\n 2.3.4 General.\n\n 2.3.4.1 The Design Services and Construction Documents provided\nand\/or prepared by Bechtel for each DC Project shall comply with (i) all\napplicable federal, state and local laws, ordinances, building and other codes,\nrules and regulations (collectively, \"LAWS\"), (ii) all covenants, conditions,\nrestrictions, easements and leases affecting the applicable DC Project sites,\ncopies of which have been provided to Bechtel by Webvan (collectively \"PRIVATE\nRESTRICTIONS\"), (iii) all applicable manufacturers' and vendors' instructions\nand specifications, and (iv) sound design and construction practices. Bechtel\nshall make recommendations regarding alternative solutions whenever design\ndetails appear to affect adversely the Development of any DC Project, the\nProject Budget, or the Project Schedule. If Webvan or Bechtel determines that\nmodifications are necessary to any such Construction Documents to comply with\nLaws which were in effect at the time each Construction Document is issued to\nWebvan or if Webvan or Bechtel determines that modifications are necessary to\nany Construction Documents to comply with any Private Restriction at the time\nsuch Construction Documents were issued to Webvan, Bechtel, at its sole cost and\nexpense, shall immediately modify the Construction Documents as necessary to\nbring the Construction Documents into compliance with such Laws and Private\nRestrictions which were in effect at the time of issuing the Construction\nDocuments and shall notify Webvan in writing of such modifications.\n\n 2.3.4.2 Bechtel shall provide all design services for the\nDevelopment of the DC Projects requested by Webvan and shall employ the services\nof reputable, licensed and well-qualified professional architects, engineers and\nother design consultants in connection with the Project (collectively\n\"SUBCONSULTANTS\") only with Webvan's prior written consent. After Webvan has\napproved \n\n\n\n 4\n 6\n\nany particular Subconsultant, Bechtel shall contract, solely in its own name and\nbehalf and not in the name or behalf of Webvan, with such Subconsultant.\nBechtel's form of agreement with Subconsultants shall be subject to the prior\napproval of Webvan and shall provide that the Subconsultants shall perform their\nrespective portions of the DC Project work in accordance with all applicable\nprovisions of this Contract and the other Contract Documents. Webvan's approvals\nshall not, however, make Webvan a party to any such agreement. Bechtel shall\ndirect and coordinate the work of its Subconsultants and shall be responsible\nfor the work performed by its Subconsultants and the compensation payable to its\nSubconsultants. Notwithstanding anything to the contrary in this Contract,\nWebvan's consent to any Subconsultant shall not in any way relieve Bechtel of\nany duty, liability or responsibility to Webvan for the Design Services (defined\nin Section 3.1) provided by Bechtel or any of its Subconsultants.\n\n 2.3.4.3 Bechtel and the applicable Subconsultants shall sign all\nConstruction Documents and other design documents prepared by or caused to be\nprepared by Bechtel under this Contract.\n\n 2.3.4.4 Bechtel shall cooperate with Webvan during Development of\nthe DC Projects to effect cost savings as deemed appropriate by Webvan without\nunnecessarily altering established Project scope or quality. Bechtel shall\nperform value-engineering concurrent with the design process to ensure that\nbuilding systems, materials, construction methods, Operating Equipment and\ncosting are properly considered. Bechtel shall seek to achieve construction\nefficiency during the design process and capture savings for Webvan to the\nextent reasonably possible.\n\n 2.3.4.5 Bechtel shall prepare and submit a critical path or\nnetwork construction schedule in form and substance satisfactory to Webvan for\nthe timing of the various components of the Development of each DC Project,\nwhich shall show in detail the various major activities to be undertaken in\nconnection with each such DC Project (including demolition, design, bidding,\nconstruction, assembly, installation, start-up and testing phases of the DC\nProject, including the obtaining of all governmental approvals and permits for\nuse and occupancy) and the approximate timing of the commencement and completion\nof such activities. Each such DC Project schedule shall also include at least a\ngeneral indication of the various activities that Bechtel expects to undertake\nin connection with the DC Project and the approximate timing of the commencement\nand completion of such activities. The parties acknowledge that each such DC\nProject schedule will be critical in allowing the parties to conceptualize and\nmonitor the Development of the Project, and Bechtel shall use its best efforts\nto prepare and regularly update each DC Project schedule so as to be as detailed\nand accurate as possible. Each such DC Project schedule, as revised from time to\ntime and approved by Webvan, is referred to herein as a \"PROJECT SCHEDULE\".\n\n 2.3.4.6 All design approvals required by Webvan shall be in\nwriting. The approval by Webvan of any design document required by this Contract\n(including, without limitation, the Schematic Design Documents, the Design\nDevelopment Documents, and the Construction Documents) shall not constitute a\nwaiver by Webvan or require Webvan to relinquish any of its rights under this\nContract, nor shall it relieve Bechtel of any of its obligations or liabilities\nfor the technical or professional adequacy of its services as described in this\nContract.\n\n 2.3.4.7 If any defect in any DC Project work arises on or before\nthe [*] anniversary of the date of Substantial Completion of the DC Project as a\nresult of any error or omission in the performance of Design Services, then\n(provided that Webvan gives Bechtel notice of such defect on or before such [*]\nanniversary) Bechtel shall, within ten (10) business days after receipt of such\nwritten notice (or such longer time as may reasonably be necessary to correct\nsuch defect) and at no cost \n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 5\n 7\n\n\nto Webvan, (i) perform all Design Services to remedy such errors and omissions,\nincluding, without limitation, the development and preparation of additional\nConstruction Documents in accordance with this Contract to correct such errors\nand omissions, and (ii) provide all Construction Services (including, without\nlimitation, all labor, equipment and materials at the applicable DC Property)\nnecessary (a) to cause the DC Project to comply in all respects with such\ncorrective Construction Documents and (b) to alter, repair, replace and\/or\nrestore DC Project work (including, without limitation, Operating Equipment) and\nthe applicable DC Property damaged, destroyed or rendered unusable (in Webvan's\nreasonable judgment) as a result of any such errors or omissions in the\nperformance of Design Services under this Contract. If Bechtel is required to\nremedy any such defects, errors and omissions under the foregoing sentence, then\nall Design Services and Construction Services provided by Bechtel to remedy such\ndefects, errors and omissions shall themselves be subject to the foregoing\nremedial obligation. If, therefore, any defect in such corrective Design\nServices and\/or Construction Services arises within [*] Bechtel shall, within\nten (10) business days after receipt of a written notice of such further defect\n(or such longer time as may reasonably be necessary to correct such defect)\nperform such additional Design Services and provide such additional Construction\nServices as may be necessary to correct such further defect as provided in the\nforegoing provisions of this Section 2.3.4.7. If Bechtel fails promptly to\ncorrect any such defects within the foregoing time periods, then Webvan may\n(without affecting Bechtel's obligations or liability hereunder) correct, or\ncause to be corrected, such defects and charge all related costs to Bechtel,\ntogether with interest (accruing from the date fifteen (15) days following the\ndate of Webvan's invoice to Bechtel for such costs) at a rate (the \"DEFAULT\nRATE\") equal to the lesser of (A) a simple per annum interest rate equal to four\npercent (4%) above the prime lending rate quoted from time to time to\nsubstantial and responsible commercial borrowers on 90-day loans by the Bank of\nAmerica, N.T.&S.A., San Francisco, California, or (B) the maximum rate permitted\nby applicable Law, until Bechtel has paid such costs.\n\n2.4 Reserved.\n\n2.5 Construction Services. Bechtel shall provide all work and furnish all\nlabor, services, materials and equipment necessary to construct and complete, in\na good and workmanlike manner, each of the DC Projects (including, without\nlimitation, the procurement, assembly, installation, testing and calibration of\nall Operating Equipment), as described and reasonably inferable from the\napproved Construction Documents for such DC Projects. Bechtel shall also assist\nWebvan with (i) planning and coordinating building systems and equipment and\nOperating Equipment pre-operational tests, start-up performance tests, on-site\nobservation and troubleshooting, (ii) notifying vendors regarding necessary\nmodifications, if any, to equipment, and (iii) coordinating the services to be\nprovided by manufacturers in adjusting, calibrating and verifying the correct\ninstallation of their equipment. Upon Bechtel's receipt, after completion of the\nConstruction Documents and Webvan's approval of the Project Schedule and Project\nBudget for a DC Project, of a written request by Webvan substantially in the\nform of Appendix 2.5A attached hereto and made a part hereof (a \"REQUEST TO\nSOLICIT BIDS\"), Bechtel shall solicit bids for such work from Subcontractors (as\ndefined in Section 2.5.8) pursuant to the bidding and approval process more\nparticularly described in Section 2.5.8. Based on Subcontractor bids approved\npursuant to Section 2.5.8, Bechtel shall deliver to Webvan for Webvan's approval\na completed Notice to Proceed for such DC Project. If Webvan and Bechtel are\nunable to agree upon the terms of a Notice to Proceed or if Bechtel fails to\ndeliver to Webvan a completed Notice to Proceed within thirty (30) days after\nthe date of Webvan's Request to Solicit Bids, then Webvan may, at Webvan's\nelection and in Webvan's sole discretion, rescind its request for such work and\nobtain performance of such work by others. Bechtel \n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 6\n 8\n\nshall undertake the construction of only those DC Projects authorized in writing\nby Webvan in a Notice to Proceed. Bechtel shall perform all Construction\nServices (as defined in Section 3.1) specified in a Notice to Proceed in\naccordance with this Contract (including the General Conditions for Construction\nattached hereto as Appendix 2.5 and made a part hereof (the \"GENERAL\nCONDITIONS\") and all other appendices attached hereto), the applicable approved\nConstruction Documents and all applicable Change Orders (as defined below in\nSection 2.5.4) executed by Webvan and Bechtel. Bechtel shall achieve Substantial\nCompletion of such work on or before the date specified in such Notice to\nProceed, at a cost not exceeding the Budgeted Cost (defined in Section 2.5.1)\nstated in such Notice to Proceed, subject to adjustment by Change Orders\nexecuted by Webvan in accordance with Section 2.5.4.1. The \"CONTRACT DOCUMENTS\"\nfor a DC Project shall consist of this Contract, the applicable approved\nConstruction Documents, and Change Orders thereto executed by Webvan, and the\nNotice to Proceed. As used herein, the term \"SUBSTANTIAL COMPLETION\" of a DC\nProject shall mean that (i) the Development of the DC Project has been completed\nin accordance with the applicable Contract Documents (including, without\nlimitation, the procurement, assembly, installation, calibration and testing of\nall Operating Equipment and the confirmation that the materials handling and\ndistribution Operating Equipment meets the Performance Standards as provided in\nSection 1.2) to the extent sufficient for Webvan to occupy and utilize the DC\nProject in a manner consistent with the Contract Documents, (ii) Bechtel has\nissued and Webvan has approved (such approval not to be unreasonably withheld) a\ncertificate of Substantial Completion for the DC Project, and (iii) Bechtel has\ndelivered to Webvan all required permits and approvals with respect to the DC\nProject from the appropriate governmental authorities, including all\ncertificates and approvals (including food, health and safety permits and\napprovals) necessary for Webvan to use and occupy the DC Project in a manner\nconsistent with the Contract Documents.\n\n 2.5.1 Budgeted Cost. The \"BUDGETED COST\" for the Development of a DC\nProject shall equal the sum of (i) the Approved Cost of the Work for such DC\nProject, plus (ii) the Contingency Amount (defined in Section 2.5.1.2 below)\nbased on such Approved Cost of the Work. Bechtel shall specify Bechtel's\nproposed Budgeted Cost, estimated Cost of the Work (defined in Section 2.5.5\nbelow), Base Contingency (defined in Section 2.5.1.2) and any requested Excess\nContingency (also defined in Section 2.5.1.2) for the Development of a\nparticular DC Project in Bechtel's Notice to Proceed for such DC Project. The\nestimated Cost of the Work for a DC Project shall be determined by adding (a)\nthe sum of all accepted Subcontractor bids for the Cost of the Work and (b) the\nGeneral Work Requirements Amount (defined in Section 2.5.3 below). The estimated\nCost of the Work for a DC Project specified in the Notice to Proceed approved\nand executed by Webvan for such DC Project is referred to herein as the\n\"APPROVED COST OF THE WORK\".\n\n 2.5.1.1 If the actual Cost of the Work is less than the Budgeted\nCost, then (except as otherwise expressly provided in Section 5.6) all savings\nshall benefit Webvan. If the actual Cost of the Work is more than the Budgeted\nCost, then Bechtel shall pay such excess from its own funds, Webvan shall not be\nrequired to pay any part of such excess, and Bechtel shall have no claim against\nWebvan on account thereof. Without limiting the generality of the foregoing, the\nBudgeted Cost for a particular DC Project shall apply only with respect to the\nDC Project in question. Any savings of the Cost of the Work for a given DC\nProject under the applicable Budgeted Cost shall not be offset or credited to\nreduce the Budgeted Cost of any other DC Project, and any excess of the Cost of\nthe Work for a given DC Project over the applicable Budgeted Cost shall not be\napplied to increase the Budgeted Cost of any other DC Project. The Approved Cost\nof the Work and the Budgeted Cost for a DC Project may be modified only as\nexpressly provided in Change Orders executed by Webvan for such DC Project in\naccordance with Section 2.5.4.1, 2.5.11 or 2.5.13.\n\n 7\n 9\n\n 2.5.1.2 The \"CONTINGENCY AMOUNT\" for a DC Project shall equal the\nsum of the Base Contingency for such DC Project plus any Excess Contingency\nspecified in the Notice to Proceed for such DC Project executed by Webvan. The\n\"BASE CONTINGENCY\" for a DC Project shall equal (i) [*] of the Approved Cost of\nthe Work for each of the first [*] DC Projects for which Webvan has executed a\nNotice to Proceed and (ii) [*] of the Approved Cost of the Work for each\nadditional DC Project. In addition to the Base Contingency, Bechtel may request\nthat Webvan approve an additional contingency amount (the \"EXCESS CONTINGENCY\")\nfor a particular DC Project. Notwithstanding anything to the contrary in any\nContract Document (including, without limitation, any Notice to Proceed), the\nExcess Contingency for any DC Project shall in no event exceed [*] of the\nApproved Cost of the Work for such DC Project. An Excess Contingency may only be\nrequested by Bechtel and shall only be deemed approved by Webvan if such Excess\nContingency is expressly identified in the Notice to Proceed executed both by\nBechtel and by Webvan for a DC Project. Webvan shall not unreasonably withhold\nits approval of any Excess Contingency requested by Bechtel.\n\n 2.5.2 Bechtel Fee. As used herein, the \"BECHTEL FEE\" is defined to be\nthe amount equal to [*] of the actual Cost of the\nWork of a given DC Project (except as provided in the following sentence),\nsubject to the applicable Budgeted Cost (as adjusted by Change Orders executed\nby Webvan in accordance with Section 2.5.4.1). Notwithstanding the foregoing,\nfor purposes of calculating the Bechtel Fee, [*].\n\n 2.5.3 General Work Requirements Amount. Appendix 2.5.3 to this Contract\ndescribes the general categories of Bechtel's General Work Requirements. Prior\nto establishing the Budgeted Cost for a DC Project, Webvan and Bechtel shall\nagree upon a schedule setting forth a more detailed, line item description of\neach of such categories and an estimated amount that may be charged for General\nWork Requirements (the \"GENERAL WORK REQUIREMENTS AMOUNT\").\n\n 2.5.4 Change in the Work. Without invalidating this Contract, Webvan may\nfrom time to time order a change in the work described in the Contract Documents\nfor any given DC Project. The Cost of the Work shall be adjusted accordingly\nbased on the additive or deductive nature of any such change in the work in\naccordance with this Section 2.5.4.\n\n 2.5.4.1 Webvan shall initiate a change in the work described in\nthe Contract Documents by preparing a written change order request (\"CHANGE\nORDER REQUEST\") setting forth in detail the nature of the requested change. On\nor before the twenty-first (21st) day following Bechtel's receipt of a Change\nOrder Request, Bechtel shall (a) complete the Change Order Request setting forth\nin detail, with a suitable breakdown, (i) the increase or decrease in the Cost\nof the Work as a consequence of the change, (ii) the revised time for the\ncompletion of all other affected work, and (iii) any adjustment in the date of\nSubstantial Completion or the amount of the Budgeted Cost of the DC Project\nattributable to the change in the work, and (b) submit the completed Change\nOrder Request to Webvan for Webvan's written approval and execution. When Webvan\nhas approved in writing and executed such a completed Change Order Request, such\nChange Order Request shall constitute a \"CHANGE ORDER\", and Bechtel shall\nundertake the change in the work described therein. Bechtel shall prepare a\nChange Order summary each month, incorporating all Change Orders that Webvan has\napproved in writing and executed during that month. Each Change Order summary\nshall include all changes in the Budgeted Cost, if any, and revisions to the\ndate of Substantial Completion, if applicable. The Budgeted Cost and the date of\nSubstantial Completion for a DC Project shall not be adjusted except by a\nwritten Change\n\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 8\n 10\n\nOrder executed by Webvan in accordance with this Section 2.5.4.1.\nNotwithstanding anything to the contrary in any Contract Documents, however, in\nno event shall the Budgeted Cost for any DC Project be increased, nor shall the\ndate of Substantial Completion for any DC Project be extended, on account of\nChange Orders to correct errors or omissions in the Construction Documents for\nsuch DC Project.\n\n 2.5.4.2 Bechtel shall submit all Subcontractor breakdowns for any\nfixed overhead, labor and profit rates related to that portion of the DC Project\nwork covered by any Change Order (\"CHANGE ORDER WORK\") which has been included\nin the Subcontractor's Subcontract. The cost for any Change Order Work shall not\nexceed the applicable fixed rates, overhead and fees listed in any such\nSubcontracts.\n\n 2.5.4.3 If Webvan and Bechtel are unable to agree (i) on a\nproposed Change Order cost or (ii) whether work required by Webvan constitutes\npart of the DC Project work or Change Order Work, then Bechtel shall submit a\nChange Order Request which sets forth a \"not-to-exceed\" cost for the proposed\nchange in the DC Project work, as well as the information required by clauses\n(i), (ii) and (iii) in Section 2.5.4.1, above. Webvan may then direct Bechtel to\nproceed with such portion of the DC Project work or such Change Order Work on\nsuch \"not-to-exceed\" cost basis with Bechtel accounting for the DC Project work\non a time and material basis. If the dispute over such Change Order Work\nconcerns cost (and not whether the work requested by Webvan already constitutes\npart of the DC Project work), then, promptly following completion of such Change\nOrder Work, Webvan and Bechtel shall execute a Change Order which sets forth the\ncost of the Change Order Work as the lesser of (x) such not-to-exceed cost or\n(y) the actual cost computed on a time and material basis, and the Budgeted Cost\nshall be adjusted accordingly. Webvan reserves the right to audit all Bechtel\nand Subcontractor records regarding such Change Orders. If Bechtel submitted a\nChange Order Request because Webvan and Bechtel could not agree on whether or\nnot certain work required by Webvan constituted part of the DC Project work or\nconstituted Change Order Work, then Webvan and Bechtel shall attempt to resolve\nthat issue as set forth in Section 2.5.12 within twenty-one (21) days after the\ncommencement of such disputed work. If Webvan and Bechtel are unable to agree on\na change in the date of Substantial Completion for any portion of the DC Project\nwork, but the Change Order is otherwise acceptable to Webvan and Bechtel, then\nBechtel shall commence the Change Order Work as directed by Webvan. If, within\ntwenty-one (21) days following such commencement, Webvan and Bechtel have not\nagreed on a change in the applicable date of Substantial Completion, then Webvan\nand Bechtel shall submit that issue to dispute resolution as set forth in\nSection 2.5.12.\n\n 2.5.4.4 Notwithstanding anything in any Contract Document to the\ncontrary, no action, conduct, omission, prior failure or course of dealing by\nWebvan shall act to waive, modify, or alter the requirement that Change Orders\nmust be in writing signed by Webvan, and that such written Change Orders are the\nexclusive method for effecting any change to DC Project work, the Cost of the\nWork, date of Substantial Completion of the DC Project or the Budgeted Cost;\nprovided, however, that Webvan's Vice President of Distribution, or any Webvan\npersonnel specifically designated by Webvan's Vice President of Distribution in\na written notice to Bechtel with respect to a particular DC Project, shall have\nthe right to enter into oral Change Orders with Bechtel for such DC Project so\nlong as (i) any such Change Order does not increase the Budgeted Cost for the DC\nProject by more than Thirty Thousand Dollars ($30,000) and does not extend the\ndate for Substantial Completion of the DC Project, and (ii) within forty-eight\n(48) hours after the parties have entered into such an oral Change Order, the\nterms of such Change Order are confirmed in a written Change Order executed by\nBechtel and Webvan. Bechtel understands and agrees that the Cost of the Work,\ndate of Substantial Completion of the DC Project, and the Budgeted Cost cannot\nbe changed by implication, oral agreements (except as specified in the preceding\nsentence), actions, inactions, course of conduct, or constructive change order.\nBechtel shall\n\n\n\n 9\n 11\n\nhave no obligation to comply with any oral Change Order Request that Bechtel in\ngood faith believes does not comply with the requirements of the foregoing\nclause (i) or that Bechtel cannot readily determine complies with such\nrequirements.\n\n 2.5.5 Costs to be Reimbursed. The term \"COST OF THE WORK\" shall mean\nreasonable costs necessarily incurred in the proper performance of Construction\nServices for the DC Project work which are actually incurred by Bechtel. Such\ncosts shall include the items set forth in this Section 2.5.5, subject to\nSection 2.5.6:\n\n 2.5.5.1 The reasonable relocation, travel (coach or equivalent\nclass only) and subsistence expenses (or per diem as applicable) that Bechtel\nemployees incur in performing Construction Services for the DC Project work, in\naccordance with reasonable policies and procedures established by Bechtel.\n\n 2.5.5.2 Cost of all materials, supplies and equipment (including\nOperating Equipment) incorporated in the DC Project work, including costs of\ntransportation thereof, excess materials and supplies, and a reasonable\nallowance for waste and spoilage.\n\n 2.5.5.3 Payments made by Bechtel to Subcontractors providing\nConstruction Services for DC Project work performed pursuant to written\nSubcontracts entered into pursuant to this Contract.\n\n 2.5.5.4 Cost, including transportation and maintenance, of all\nmaterials, supplies, equipment (including, without limitation, any computers and\nother office equipment), temporary facilities and hand tools purchased by\nBechtel to perform the DC Project work which are consumed in the performance of\nthe DC Project work, and the cost (less salvage value) of such items used to\nperform the DC Project work, but not consumed in the performance of the DC\nProject work. In the latter of the two situations described in the immediately\npreceding sentence, Bechtel shall become the owner of such items upon completion\nor termination of the DC Project work. Webvan may, at its discretion, retain\nownership of those items not consumed in the performance of the DC Project work\nor may direct Bechtel to sell or buy such items and credit the Cost of the Work\nby the amount of the proceeds which would then determine the salvage value\ndescribed above. Bechtel shall provide Webvan with a schedule indicating the\nthen current inventory of all construction equipment, hand tools, and temporary\nfacilities, showing original cost (as amended from time to time, the \"EQUIPMENT\nSCHEDULE\"). Bechtel shall amend the Equipment Schedule by deleting all items\nconsumed and adding all items purchased during the course of the DC Project\nwork. Bechtel shall maintain a current Equipment Schedule located at each DC\nProject office for review by Webvan for equipment whose individual cost is One\nThousand Dollars ($1,000) or more.\n\n 2.5.5.5 Rental charges for all necessary machinery and equipment,\nexclusive of hand tools, used at the site of the DC Project work, whether rented\nfrom Bechtel or others, including installation, minor repairs and replacements,\ndismantling, removal, transportation and delivery costs thereof.\n\n 2.5.5.6 Costs of premiums for insurance that Bechtel is required\nto maintain pursuant to Section 7 hereof, deductibles thereunder not exceeding\nTen Thousand Dollars ($10,000) per occurrence, and costs of Subcontract bonds.\nBechtel shall have the right to require that any Subcontractor be bonded if such\nrequirement is commercially reasonable under the circumstances. With respect,\nhowever, to any Subcontractor that Webvan has specified as the only\nsubcontractor that Bechtel is authorized to engage to perform particular\nServices, Bechtel shall not have the right to require bonding \n\n\n\n 10\n 12\n\nof such Subcontractor if Webvan agrees that any delay in the performance of such\nServices by such Subcontractor will constitute an Excusable Delay (as defined in\nSection 2.5.13).\n\n 2.5.5.7 Sales, use or similar taxes imposed by any governmental\nauthority which are related to the DC Project work and for which Bechtel is\nliable.\n\n 2.5.5.8 Permit fees, royalties approved in advance by Webvan, and\ndeposits lost for causes other than Bechtel's fault or negligence .\n\n 2.5.5.9 Construction temporary utilities costs, including, but not\nlimited to, the cost of water, gas and electricity consumed in construction of\nthe DC Project.\n\n 2.5.5.10 Minor expenses such as telegrams, long distance telephone\ncalls, telephone service at the site, overnight courier service, and similar\npetty cash items in connection with the DC Project work.\n\n 2.5.5.11 The cost of removal of all debris from the site of the DC\nProject work, unless such cost is otherwise included in the Cost of the Work\nhereunder.\n\n 2.5.5.12 Costs incurred due to an emergency affecting the safety\nof persons and property, unless arising out of the fault or negligence of\nBechtel or its Subcontractors, employees or agents.\n\n 2.5.5.13 The cost of on-site security necessary to protect the\nmaterials, supplies, equipment and DC Project improvements at the DC Project\nsite, including any watchmen, temporary fencing, or other security services\nreasonably required to protect the DC Project work.\n\n 2.5.5.14 Other costs incurred in the performance of the DC Project\nwork, if and to the extent approved in advance in writing by Webvan.\n\n 2.5.5.15 Unit Rates as set forth in Appendix 5.1.2 for Bechtel\nemployees performing Construction Services for DC Projects, it being understood\nthat such rates are deemed to include all benefits and other payroll burden and\noverhead.\n\n 2.5.6 Costs Not to be Reimbursed. The term \"COST OF THE WORK\" shall not\ninclude any of the items set forth in this Section 2.5.6.\n\n 2.5.6.1 Salaries, bonuses, benefits and other compensation of any\nBechtel employees or personnel, other than as expressly provided in Section\n2.5.5.15.\n\n 2.5.6.2 Expenses of Bechtel's principal and branch offices other\nthan the DC Project field office.\n\n 2.5.6.3 Any part of Bechtel's capital expenses, including interest\non Bechtel's capital employed for the DC Project work.\n\n 2.5.6.4 Except as specifically provided in Section 2.5.5.5, rental\ncost of machinery and equipment.\n\n\n 11\n 13\n\n 2.5.6.5 Overhead or general expenses of any kind, unless expressly\nincluded in Section 2.5.5.\n\n 2.5.6.6 Costs incurred by Bechtel, any Subcontractor,\nSubconsultant, or anyone directly or indirectly engaged by any of them, as a\nresult of the negligence of any such parties or of anyone for whose acts any of\nthem may be liable, including but not limited to, the costs of correction of\ndefective or non-conforming DC Project work, disposal of materials and equipment\nwrongly supplied, or making good any damage to property, subject to Section\n7.2.5 hereof concerning waiver of subrogation rights.\n\n 2.5.6.7 The cost of any item not specifically and expressly\nincluded in the items described in Section 2.5.5, unless previously specifically\napproved in writing by Webvan.\n\n 2.5.6.8 Losses and expenses sustained by Bechtel, Subcontractors\nor Subconsultants, not compensated by insurance or otherwise, if such losses or\nexpenses arise out of the infidelity or dishonesty on the part of an employee of\nBechtel or a Subcontractor or Subconsultant.\n\n 2.5.6.9 Losses and expenses not covered by insurance, if Bechtel\nshall fail to obtain and\/or maintain in effect the insurance required by the\nContract Documents, insurance deductibles in excess of Ten Thousand Dollars\n($10,000) per occurrence, and coinsurance amounts.\n\n 2.5.6.10 Costs, losses, expenses, bonds and\/or insurance incurred\nby reason of Bechtel's general operations which Bechtel would customarily incur\nor carry without reference to Bechtel's obligations under this Contract; and,\nexcept as otherwise agreed to in writing by Webvan, insurance costs for any type\nor amount of insurance other than the insurance Bechtel is required to carry\npursuant to Section 7 hereof.\n\n 2.5.6.11 Costs in excess of the Budgeted Cost, as it may be\nadjusted pursuant to Section 2.5.4.\n\n 2.5.6.12 Intentionally omitted.\n\n 2.5.6.13 Provided that Webvan has paid Bechtel all amounts then\nproperly due and payable under this Contract, the Cost of the Work shall not\ninclude any sums spent or costs incurred by Bechtel, or for which Bechtel is\nliable or obligated, with respect to any Mechanics' Liens (defined in Section\n4.2.2) filed or served by any Subcontractor or Subconsultant because of\nBechtel's failure or refusal to pay any such Subcontractor or Subconsultant,\nwhether or not any such failure or refusal is wrongful or as a result of a bona\nfide dispute between Bechtel and any such Subcontractor or Subconsultant,\nincluding, without limitation, any amounts paid or incurred to discharge or\nrelease such Mechanics' Liens (whether paid to such claimant or other party, or\nas attorneys' fees or otherwise), and all costs of any bonds obtained to clear\nany such Mechanics' Liens.\n\n 2.5.6.14 Fees, compensation, costs or expenses of any\nSubconsultant or any other person or entity providing Consultant Services or\nDesign Services (defined in Section 3.1), it being the intention of Webvan and\nBechtel that all such fees, compensation, costs and expenses for Consultant\nServices and Design Services shall be paid only as provided in Section 5.1 and\nSection 5.3, respectively.\n\n 2.5.6.15 Costs resulting from any errors or omissions in the\nConstruction Documents for any DC Project.\n\n\n\n 12\n 14\n\n 2.5.7 Discounts, Rebates and Refunds. Bechtel shall use best efforts to\npurchase all materials and equipment (including, without limitation, Operating\nEquipment) to be included in the Cost of the Work for any DC Project at the\nlowest prices commercially available to Bechtel given Bechtel's position as a\nbulk purchaser of such materials and equipment. All trade discounts, rebates and\nrefunds, and all returns from sale of surplus materials and equipment, shall\naccrue to Webvan.\n\n 2.5.8 Subcontracts and Other Agreements. All portions of the DC Project\nwork that Bechtel does not perform with its employees shall be performed\npursuant to written subcontracts and, where applicable, sub-subcontracts or\nmaterial purchase orders (collectively, \"SUBCONTRACTS\") with licensed or\notherwise properly qualified subcontractors, sub-subcontractors, laborers,\narchitects, design professionals, engineers, surveyors, consultants, equipment\nlessors, and material suppliers (collectively, \"SUBCONTRACTORS\"). It is the\nintention of the parties hereto that Bechtel shall act as a general contractor\nin connection with Bechtel's performance of the Construction Services hereunder.\nBechtel shall secure at least three (3) qualified bids from Subcontractors on\neach item in the construction of a DC Project (excluding those included in the\nGeneral Work Requirements), including, without limitation, those performed by\nBechtel, unless otherwise agreed to by Webvan. Bechtel shall promptly deliver to\nWebvan for each DC Project a summary of all bids received, together with\nBechtel's analysis and recommendations for awards. In addition, upon Webvan's\nrequest from time to time, Bechtel shall deliver to Webvan complete copies of\nall bids received and all other pertinent data. Webvan may attend all bid\nopenings. Bechtel shall keep all bid results confidential. Bechtel shall certify\nthat, to the best of Bechtel's knowledge, each bid is bona fide, complete and\nreasonable. As part of its bid analysis, Bechtel shall notify Webvan of any bid\nthat deviates from the Contract Documents. Webvan's approval of a bid on a\nSubcontract shall not constitute approval of a deviation or omission from the\nContract Documents. Any approved deviation or omission from the Contract\nDocuments shall occur only by means of a Change Order.\n\n 2.5.8.1 All Subcontractors and Subcontracts for the procurement,\nassembly, installation, start-up, testing and calibration of Operating Equipment\nand any additional refrigeration systems or equipment shall be subject to\nWebvan's prior written approval. In addition, Webvan reserves the right to\nreject any Subcontractor or any bid of a Subcontractor at any time prior to\naward. Webvan shall have five (5) business days after it receives Bechtel's\nwritten recommendations to approve or disapprove Bechtel's recommendations for\nall Subcontractors and Subcontracts for the procurement, assembly, installation,\nstart-up, testing and calibration of Operating Equipment and other refrigeration\nsystems and equipment and to reject Bechtel's recommendations for any other\nSubcontractors or bids. After Webvan has approved or not rejected (as\napplicable) the award of any such Subcontract, Bechtel shall contract, solely in\nits own name and behalf, and not in the name or behalf of Webvan, with the\nspecified Subcontractor. Bechtel's Subcontract form shall provide that the\nSubcontractor shall perform its portion of the DC Project work in accordance\nwith all applicable provisions of this Contract and the other Contract\nDocuments. In addition, all Subcontracts relating to any Operating Equipment or\nrefrigeration system or equipment shall be submitted to Webvan for approval\nprior to execution by Bechtel. Webvan's approval shall not make Webvan a party\nto any Subcontract.\n\n 2.5.8.2 All Subcontracts shall, so far as practicable, contain\nunit prices, markups for overhead and profit, and any other feasible formula for\nuse in the determination of the cost of changes in the DC Project work and shall\ncontain (where applicable) warranties, conditions and covenants which are\nsubstantively similar to the Contract Documents. Upon request by Webvan, Bechtel\nshall furnish Webvan with copies of all warranties provided by vendors,\nmanufacturers, laborers and material suppliers relating to the Subcontracts and\nwill deliver all warranties at Substantial Completion. Bechtel shall hold all\nSubcontractors, including all persons directly or indirectly employed by them,\nresponsible \n\n\n\n 13\n 15\n\nfor any damages due to breach of contract, negligence and willful misconduct and\nshall use reasonable efforts diligently to recover such damages. All\nSubcontracts shall contain a clause approved by Webvan allowing for the direct\nassignment of each Subcontract to Webvan upon termination or full performance of\nthis Contract. Each Subcontract may then be further assigned to a new general\ncontractor if Webvan so elects. Notwithstanding any such delivery of warranties\nor assignment of Subcontracts, however, Bechtel shall reserve rights of recourse\nthereunder to the extent necessary to permit Bechtel to enforce such warranties\nand Subcontracts in the event that Webvan makes any claim against Bechtel with\nrespect to goods or services that are the subject of such warranties and\nSubcontracts. The foregoing reservation of rights by Bechtel shall not, however,\nin any way impair Webvan's right to pursue direct recourse against the makers of\nsuch warranties and the Subcontractors under such Subcontracts.\n\n 2.5.9 Schedule of Values. Subject to the approval of Webvan, Bechtel\nshall prepare (at such time as Bechtel has sufficient information) a schedule of\nvalues which divides the Cost of the Work for the various trades, Subcontracts,\nsuppliers, materials, equipment (including Operating Equipment), labor or other\nrecognized industry trade breakdowns (\"SCHEDULE OF VALUES\"). Bechtel warrants\nthat the breakdowns so prepared will be accurate breakdowns of Bechtel's\nestimated costs used to determine the Budgeted Cost. The Schedule of Values, as\napproved by Webvan, shall be used as the basis for Bechtel's applications for\npayment.\n\n 2.5.10 Warranty. Bechtel warrants to Webvan that (a) materials and\nequipment (including Operating Equipment) furnished under this Contract will be\nof good quality and new (unless otherwise required or permitted by the Contract\nDocuments) and will be assembled and installed in accordance with all vendors'\nand manufacturers' instructions and specifications, (b) each DC Project will be\nfree from defects, and (c) each DC Project will conform with the requirements of\nthe applicable Contract Documents. DC Project work not conforming to these\nrequirements, including substitutions not properly approved and authorized,\nshall be considered defective. All guaranties and warranties of materials and\nequipment (including Operating Equipment) used or incorporated into the DC\nProjects shall be assigned and delivered by Bechtel to Webvan upon demand, or\nwithout demand upon Final Completion of each DC Project. The warranties in\nContract Documents or assigned to Webvan (i) shall survive the completion of the\nServices for each DC Project and the termination of the Contract Documents, and\n(ii) shall inure to the benefit of Webvan's successors and assigns. Without\nlimiting any other rights or remedies of Webvan under this Contract, if Webvan\nprovides written notice of any defect in a DC Project in violation of the\nforegoing within [*] after the date of Substantial Completion of the DC\nProject, Bechtel shall, within ten (10) business days after receipt of such\nwritten notice of such defect (or such longer time as may reasonably be\nnecessary to correct such defect), furnish, at no cost to Webvan, all labor,\nequipment and materials at the applicable DC Property (as defined in Section\n5.2.2.8) necessary to correct such defect and cause the DC Project to comply\nfully with the foregoing warranties. If Bechtel is required to remedy any such\ndefect under the foregoing sentence, then all labor, equipment and materials\nprovided by Bechtel to remedy such defect shall themselves be subject to the\nforegoing warranties. If, therefore, Webvan provides written notice of any\ndefect in such corrective labor, equipment, or materials within the earlier to\nexpire of [*], then Bechtel shall, within ten (10) business days after\nreceipt of such written notice of such further defect (or such longer time as\nmay reasonably be necessary to correct such defect), furnish, at no cost to\nWebvan, all labor, equipment and materials at the applicable DC Property\nnecessary to correct such further defect and cause the DC Project to comply\nfully with the warranties provided in this Section 2.5.10. If Bechtel fails to\npromptly correct any such defects within the foregoing time periods, then Webvan\nmay (without voiding Bechtel's warranties) correct, or cause to be corrected,\nsuch defects and \n\n\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n 14\n 16\n\ncharge all related costs to Bechtel, together with interest at the Default Rate\nuntil Bechtel has paid such costs.\n\n 2.5.11 Claims.\n\n 2.5.11.1 Bechtel must give notice of any claim on or before the\nearlier of (i) the twenty-first (21st) day after Bechtel first recognizes the\ncondition giving rise to the claim, or (ii) the delivery to Webvan of Bechtel's\nFinal Application for Payment. Claims must be made by written notice. Failure to\ndeliver any such notice or request within the required period shall constitute\nan irrevocable waiver of any such claim. If a claim has been implemented by\nChange Order, no further consideration will be given to such claim.\n\n 2.5.11.2 Pending final resolution of a claim (whether by\nmediation, arbitration, or litigation), unless otherwise agreed in writing,\nBechtel shall proceed diligently with performance of this Contract and Webvan\nshall continue to make payments in accordance with the Contract Documents.\n\n 2.5.11.3 If conditions are encountered at a DC Property which are\n(i) subsurface or otherwise concealed physical conditions which differ\nmaterially from those indicated in the Contract Documents or (ii) unknown\nphysical conditions of an unusual nature which differ materially from those\nordinarily found to exist and generally recognized as inherent in construction\nactivities of the character provided for in the Contract Documents, then notice\nby the observing party shall be given to the other party promptly, before such\nconditions are disturbed, and in no event later than twenty-one (21) days after\nfirst observance of the conditions. Webvan will promptly investigate such\nconditions and make its determination. If Bechtel is opposed to such\ndetermination, Bechtel must make a claim within twenty-one (21) days after\nnotice of Webvan's decision.\n\n 2.5.11.4 If Bechtel wishes to make a claim for an increase in the\napplicable Budgeted Cost, Bechtel shall give written notice within the 21-day\ntime period set forth Section 2.5.11.1 above to Webvan, and Webvan shall be\ngiven reasonable time to evaluate the condition giving rise to such claim prior\nto the time Bechtel proceeds to execute the applicable DC Project work. Prior\nnotice is not required for claims relating to an emergency endangering life or\nproperty. If Bechtel believes additional cost is involved for reasons including\nbut not limited to (i) an order by Webvan to stop the DC Project work where\nBechtel was not at fault, (ii) failure of payment by Webvan, (iii) termination\nof this Contract by Webvan, (iv) Webvan's suspension of DC Project work, or (v)\nother reasonable grounds, such claim shall be filed in accordance with the\nprocedure established herein.\n\n 2.5.11.5 If Bechtel wishes to make a claim for an increase in the\nContract Time, written notice shall be given to Webvan within the time period\nset forth above in Section 2.5.11.1. Bechtel's claim shall include an estimate\nof cost and the probable effect of delay on progress of the DC Project work. In\nthe case of a continuing delay, only one claim is necessary.\n\n 2.5.12 Resolution of Claims and Disputes. If a claim by either party\nagainst the other has not been resolved, the party making the claim shall,\nwithin ten (10) days after the other party's preliminary response, take one or\nmore of the following actions: (i) submit additional supporting data, (ii)\nmodify the initial claim or (iii) notify the other party that the initial claim\nstands.\n\n 2.5.12.1 Continued Performance. Notwithstanding any provisions to\nthe contrary in this Section 2.5.12, if any dispute arises between Webvan and\nBechtel which relates to the Contract Documents or any DC Project work, Bechtel\nshall not interrupt the progress of the work or the \n\n\n\n 15\n 17\n\nperformance of Services regarding any of the Project during the pendency of any\nsuch dispute, unless ordered to do so by Webvan in writing and Webvan shall make\nall progress payments for the Cost of the Work incurred by Bechtel other than\ndisputed amounts. Bechtel must submit claims on or before the earlier of (i) the\ntwenty-first (21st) day after Bechtel first recognizes the condition giving rise\nto such claim, or (ii) the delivery to Webvan of Bechtel's Final Application for\nPayment; no additional claim made by Bechtel after an initial claim on the same\nmatter has been implemented by a Change Order will be considered. Except to the\nextent such costs are incurred with respect to the resolution of claims pursuant\nto Sections 2.5.11 and 2.5.12 hereof, if either party brings any action or legal\nproceeding for an alleged breach of any provision of this Contract, to terminate\nthis Contract or otherwise to enforce, protect or establish any term or covenant\nof this Contract, the prevailing party shall be entitled to recover as a part of\nsuch action or proceeding, or in a separate action brought for that purpose,\nreasonable attorneys' fees, court costs, and expert fees as may be fixed by the\ncourt.\n\n 2.5.12.2 Mediation of Disputes. All claims between the parties\nshall be handled as follows: (i) the parties shall endeavor, in good faith, to\nsettle a claim in an amicable fashion pursuant to Section 2.5.11 hereof, and\n(ii) if the parties are unable to resolve a claim pursuant to Section 2.5.11\nwithin a reasonable period (but in no event longer than forty-five (45) days)\nafter the claim is submitted to the other party, then the parties shall submit\nthe claim to non-binding mediation with Jams\/Endispute or its successor (\"JAMS\")\nin San Francisco County, California, before having recourse to a judicial forum.\nMediation shall be initiated by the written request of either party and shall be\ncommenced within five (5) days after delivery of such notice. The mediator shall\nbe a neutral third party affiliated with and selected by JAMS. Upon request of\nthe initiating party or JAMS, the other party shall promptly evidence its\nconsent to the mediation if such consent is required to proceed.\n\n 2.5.12.3 Resolution. The resolution of any claim for adjustment to\nthe applicable Budgeted Cost or Contract Time for a DC Project shall be\ndocumented, promptly after resolution of such claim, in a Change Order executed\nby Bechtel and Webvan.\n\n 2.5.13 Delays and Extensions of Time. If Bechtel is delayed in the\nperformance of Construction Services for any DC Project by an Excusable Delay,\nthen the applicable Contract Time (defined in Section 3.2.2) and Budgeted Cost\nshall be adjusted by Change Order for such time and in such amount as is\nreasonable and appropriate under the circumstances, as approved by Webvan and\nBechtel, which approvals shall not be unreasonably withheld. No event of\nExcusable Delay shall be deemed to have occurred unless Bechtel delivers notice\nof a claim of justifiable delay to Webvan within twenty-one (21) days following\nthe commencement of the delay. Immediately upon commencement of a delay, Bechtel\nshall take all steps reasonably available to Bechtel to lessen the adverse\nimpact of such delay. As used herein, \"EXCUSABLE DELAY\" means an actual delay in\nthe performance of Construction Services for any DC Project by Bechtel which is\ncaused by events beyond the reasonable control of Bechtel despite having made\nall reasonable attempts to avoid such delay and to prevent and mitigate the\neffects thereof. Such events may include, without limitation, the following:\n\n 2.5.13.1 Actions or inactions of Webvan, or of any employee,\nagent, representative or separate contractor of Webvan (other than by reason of\nthe proper and timely exercise of their respective rights, duties and\nobligations under the Contract Documents); or\n\n 2.5.13.2 Fire, flood, war, embargo, sabotage, earthquake, or by\ninjunction (not the fault of Bechtel) or other unavoidable damage to the\napplicable DC Project not the fault of Bechtel; or\n\n\n 16\n 18\n\n 2.5.13.3 Adverse weather conditions documented by data\nsubstantiating that such weather conditions were abnormal for the period of time\nand could not have been reasonably anticipated and had an adverse effect on the\nscheduled construction; or\n\n 2.5.13.4 General strike, delays (not caused by Bechtel) in\nobtaining required governmental permits and approvals, strikes and\/or losses\nduring transportation.\n\nNotwithstanding the foregoing, the financial inability or unwillingness of\nBechtel or any Subcontractor, Subconsultant, vendor or supplier to pay or\nperform any obligation shall not be grounds for an Excusable Delay, unless the\nSubcontractor, Subconsultant, vendor or supplier asserting such financial\ninability was previously designated by Webvan as the sole provider that Webvan\nwould authorize Bechtel to engage to provide the applicable goods or services.\nClaims arising from any Excusable Delay relating to Contract Time, Budgeted Cost\nand the Bechtel Fee shall be made in accordance with applicable provisions of\nSection 2.5.11; provided, however, that in no event will Bechtel be entitled to\nrecover from Webvan any damages resulting from such Excusable Delay.\nNotwithstanding anything to the contrary contained herein or in any other\nContract Document, Bechtel shall have no remedy for, and shall be responsible\nfor, any delay in the Development of a DC Project other than an Excusable Delay.\n\n2.6 Procurement\n\nAs and when requested by Webvan, Bechtel shall procure furniture, fixtures,\nequipment and other personal property (collectively, \"FF&E\") for the DC Projects\nwhich are not specified in the Construction Documents, the parties acknowledging\nthat procurement of all Operating Equipment and other goods, materials and\nequipment described in any Construction Documents shall be included within\nConstruction Services and shall not be subject to this Section 2.6. Procurement\nof FF&E shall include, without limitation, (a) Bechtel's best efforts to\npurchase such FF&E at the lowest prices commercially available to Bechtel, (b)\nBechtel's assembly and installation of FF&E, at Webvan's request, in accordance\nwith all applicable Laws and manufacturers' and vendors' instructions and\nspecifications, and (c) Bechtel's transfer to Webvan of title to all FF&E free\nand clear of any liens, security interests, claims or encumbrances of any kind.\nBechtel shall execute and deliver to Webvan such bills of sale and other\ndocuments as Webvan may reasonably request to effect such transfers. In\nconnection with such procurement Bechtel shall also (i) identify and recommend\npotential vendors for approval by Webvan, (ii) identify FF&E bulk pricing\nstrategies and purchase discount, rebate and refund opportunities, (iii) prepare\nbid packages, contracts and purchase orders for approval by Webvan and enter\nsuch contracts and execute purchase orders approved by Webvan, and (iii)\nschedule, coordinate and supervise the delivery, storage and installation of\nsuch FF&E. Bechtel shall assign to Webvan all warranties, guaranties and\nindemnities and shall deliver to Webvan all instructions, operating manuals and\nother materials in connection with such FF&E. If Bechtel fails to procure FF&E\nin accordance with this Section 2.6, then Bechtel shall correct such improper\nprocurement at Bechtel's sole cost and expense. Correction of such procurement\nshall include, without limitation, Bechtel's purchase, assembly, installation\nand transfer, at no cost to Webvan, of replacement FF&E in the manner provided\nin the foregoing clauses (a), (b) and (c) of this Section 2.6.\n\n2.7 Training\n\nAs and when requested by Webvan, Bechtel shall provide skilled and competent\npersonnel to assist Webvan with the training of Webvan's operation and\nmaintenance personnel in proper operations, schedules and procedures for the\nmaintenance, repair and operation of DCs (including, without limitation, all\nbuilding systems and equipment and all Operating Equipment). Bechtel's liability\nfor any \n\n\n\n 17\n 19\n\ndeficient Services provided under this Section 2.7 shall be limited to the\nre-performance of such Services during the term of this Contract at no\nadditional charge to Webvan.\n\n3.0 CONTRACT TIME\n\n3.1 Generally. Time is of the essence for Bechtel's performance of Services\nunder this Contract. Bechtel shall perform all Services as expeditiously as is\nconsistent with the professional skill and care and the orderly progress of the\nProject and shall complete performance as set forth in the executed Notices to\nProceed and approved Project Schedules. All Services described in Section 2.1\nregarding program management and Section 2.3 regarding design are referred to\nherein collectively as \"DESIGN SERVICES\". All Services described in Section 2.2\nregarding site evaluation and selection, Section 2.6 regarding procurement, and\nSection 2.7 regarding training are referred to herein collectively as\n\"CONSULTANT SERVICES\". All Services described in Section 2.5 regarding\nconstruction services are referred to herein collectively as \"CONSTRUCTION\nSERVICES\".\n\n3.2 Construction Services. The time allowed for Substantial Completion of the\nConstruction Services and all important construction milestones shall be set\nforth in the Project Schedules and Notices to Proceed. Final Completion of a\ngiven DC Project shall occur within forty-five (45) days following Substantial\nCompletion and agreement upon the Punch List. As used herein, \"FINAL COMPLETION\"\nof a DC Project shall occur only when all of the following have occurred: (i)\nthe performance of the DC Project work has been fully completed (including,\nwithout limitation, all Punch List items), (ii) all final releases, documents\nand manuals required by the Contract Documents have been delivered to Webvan,\n(iii) all start-up testing, inspection and calibration of building systems and\nequipment and Operating Equipment have been completed, and (iv) all other\nconditions have been satisfied for making the Final Payment to Bechtel for such\nDC Project under Section 5.2.2.9. As used herein, \"PUNCH LIST\", shall mean a\ncomprehensive list of minor items to be completed or corrected following\nSubstantial Completion of the DC Project work, which items shall not materially\naffect the use, occupancy or operation of the DC Project (including, without\nlimitation, the Operating Equipment).\n\n 3.2.1 Bechtel shall achieve Substantial Completion of each DC Project\nwithin the time specified therefor in the corresponding Notice to Proceed for\nsuch DC Project.\n\n 3.2.2 For purposes of this Contract, \"CONTRACT TIME\" shall mean the\nperiod of time, including adjustments authorized by approved Change Orders,\nallotted in the Contract Documents for the Substantial Completion of a DC\nProject. If Bechtel is delayed on the critical path, then the provisions of\nSection 2.5.13 shall apply. Bechtel shall advise Webvan of any delay in the\nSubstantial Completion of the DC Project work and the cause of such delay,\npursuant to Section 2.5.11.5. Bechtel shall take all prudent steps necessary to\nminimize the delay and shall diligently proceed to complete the DC Project work\nas required by the Contract Documents.\n\n4.0 BECHTEL'S DUTIES AND STATUS\n\n4.1 Standard of Care. Bechtel represents that it is skilled in the\nprofessional callings necessary to perform the Services and acknowledges that\nWebvan, not being skilled in such matters, is relying upon the skill and\nknowledge of Bechtel. Bechtel accepts the relationship of trust and confidence\nestablished by this Contract and shall exercise its best skill and judgment and\nshall cooperate with Webvan to further the interests of Webvan. Bechtel shall\nperform the Services under this Contract in accordance with the professional\nstandard and quality which prevails among reputable, well-qualified, nationally\nrecognized, licensed design\/build general contracting, architectural and\nengineering firms performing services of the \n\n\n\n 18\n 20\n\nnature and in the locations encompassed within this Contract. All Services shall\nbe performed by well-qualified, efficient, properly-trained and adequately\nsupervised Subcontractors, Subconsultants and employees of Bechtel in accordance\nwith the foregoing professional standards. Nothing contained in this Contract\nshall create a contractual relationship between Webvan and such Subconsultants,\nSubcontractors, suppliers or third parties. Webvan, however, shall be an express\nthird party beneficiary of any and all agreements between Bechtel and any such\nSubconsultants, Subcontractors, suppliers and third parties entered into with\nrespect to the Project, and the Subconsultants, Subcontractors, suppliers and\nthird parties entering into such contractual relationships with Bechtel shall\nexpressly acknowledge Webvan as such third party beneficiary and shall have,\namong other obligations, a professional responsibility and liability to Webvan\nas such third party beneficiary.\n\n4.2 Bechtel's Performance of the Contract.\n\n 4.2.1 Bechtel shall provide a sufficient and competent organization,\nincluding a Program Director, a Deputy Program Director, Project Managers,\nConstruction Managers, Project Contracts Managers, Project Engineers, Site\nManagers, Construction Superintendents, Construction Supervisors, engineers,\ncost and schedule engineers, administrative and clerical personnel, and others,\nas the Services may require. The Program Director and the Deputy Program\nDirector shall represent Bechtel, and communications given by or to either the\nProgram Director or the Deputy Program Director shall be as binding as if given\nby or to Bechtel. Webvan shall have the right to approve of Bechtel's Program\nDirector, Deputy Program Director, Project Managers, Construction Managers, and\nSite Managers for each of the DC Projects. Webvan may require Bechtel to dismiss\nfrom the Project any of Bechtel's personnel whose performance is not\nsatisfactory, at Webvan's reasonable discretion. Any such dismissed personnel\nshall be replaced with personnel reasonably satisfactory to Webvan. Bechtel\nshall not replace any of Bechtel's Program Director, Deputy Program Director,\nProject Managers, Construction Managers or Site Managers without Webvan's prior\nwritten consent, which consent shall not be unreasonably withheld. If any\npersonnel engaged in the Project die, become disabled or voluntarily terminate\ntheir employment with Bechtel, then such persons shall be replaced with persons\nof equal or better skill and experience. Bechtel shall furnish efficient\nbusiness administration and superintendence, and shall use its best efforts to\nfurnish at all times an adequate supply of workers and materials and to perform\nthe Services in the best, most expeditious and most economical manner consistent\nwith the interests of Webvan.\n\n 4.2.2 Bechtel shall provide or cause to be provided all design services,\nlabor, materials, equipment, tools, construction equipment and machinery, water,\nheat, utilities, transportation and other facilities and services necessary for\nthe Development and completion of the DC Projects, whether temporary or\npermanent and whether or not incorporated or to be incorporated into the DC\nProjects. Bechtel shall perform and complete the Services as described in this\nContract in a good and workmanlike manner, in accordance with the Contract\nDocuments, and free of any and all mechanics' liens, materialmen's liens, other\nliens, encumbrances, stop notices, charges, impositions, garnishments and\nattachments upon or against the real property upon which the DC Projects will be\nlocated (collectively, \"MECHANICS' LIENS\"), the Project, any equipment or\nmaterials (including, without limitation, Operating Equipment), or Webvan.\n\n 4.2.3 The design and construction of the DC Projects by Bechtel or any\nof its Subconsultants or Subcontractors shall be in conformity in all respects\nwith all Laws. As of the time that Webvan and Bechtel agree upon the Budgeted\nCost for a DC Project, Bechtel shall have satisfied itself with respect to\nvisible conditions, then-current public knowledge, matters of record, and all\nother then-existing information relevant to the DC Project and available to\nBechtel through the exercise of reasonable \n\n\n\n 19\n 21\n\ndiligence. Bechtel's agreement to the Budgeted Cost for a DC Project shall be\ndeemed conclusively to be an acceptance by Bechtel of the foregoing information\nand a determination by Bechtel that the Budgeted Cost is just and reasonable\ncompensation for the Construction Services.\n\n 4.2.4 If any disputed claim should arise between Webvan and Bechtel\nunder this Contract or otherwise concerning the DC Projects (including, without\nlimitation, any claim under Section 2.5.11), Bechtel shall proceed to perform\nthe Services as directed by Webvan pending resolution of the dispute. Until any\nsuch disputed claim is resolved, Webvan shall continue to pay Bechtel all sums\ndue Bechtel which are not in dispute and\/or are not directly related to Services\nwhich are in dispute.\n\n5.0 COMPENSATION\n\n5.1 Consultant Services.\n\n 5.1.1 Payment.\n\n 5.1.1.1 For Consultant Services performed by Bechtel in accordance\nwith an approved Notice to Proceed, Webvan shall pay Recoverable Costs (defined\nin Section 5.1.2 below) to Bechtel on a monthly basis, it being understood that\n(i) Webvan shall have no obligation to pay for Recoverable Costs for Consultant\nServices which have not been approved in advance by Webvan in a written Notice\nto Proceed, and (ii) the maximum amount of Recoverable Costs payable by Webvan\nto Bechtel for Consultant Services shall not exceed the stated \"not to exceed\"\namounts set forth in the approved Notice to Proceed; any charges by Bechtel in\nexcess of such amounts shall be at no cost to Webvan.\n\n 5.1.1.2 On or before the tenth (10th) day of the first month in\nwhich Bechtel is to provide Consultant Services for particular DC Projects,\nBechtel shall submit to Webvan an invoice for each such DC Project of the amount\nof Recoverable Costs for Consultant Services that Bechtel reasonably estimates\nthat it will incur during such first month for such DC Project. On or before the\ntenth (10th) day of the second month in which Bechtel is to provide Consultant\nServices for each such DC Project and continuing each month thereafter until the\nmonth following the last month in which Consultant Services are provided by\nBechtel for each such DC Project, Bechtel shall submit to Webvan an invoice that\nstates (a) the estimated amount of Recoverable Costs paid in advance by Webvan\nfor the prior month, (b) the actual amount of Recoverable Costs incurred by\nBechtel during the prior month, and (c) the amount of Recoverable Costs that\nBechtel reasonably estimates that it will incur during the current month. Each\nsuch invoice shall (1) be in a form reasonably acceptable to Webvan, (2) provide\nin reasonable detail the actual amount of time spent daily by each Bechtel\nemployee, and the total Unit Rate costs allocable to such employee's work for\neach day during the prior month, and a reasonable estimate of the work to be\nprovided by Bechtel employees during the current month, (3) describe in detail\nthe Recoverable Costs actually incurred by Bechtel during the prior month (and\nshall include copies of invoices from the applicable vendors of any FF&E\nprocured by Bechtel), and a reasonable estimate of the type and amount of\nRecoverable Costs that Bechtel will incur during the current month, and (4)\nprovide a reconciliation of the actual Recoverable Costs incurred by Bechtel\nduring the prior month against the estimate of the Recoverable Costs paid by\nWebvan for such prior month.\n\n 5.1.1.3 Notwithstanding anything contained in any invoice\nsubmitted by Bechtel, (a) if the amount of estimated Recoverable Costs paid by\nWebvan for any month is greater than the amount of actual Recoverable Costs\nincurred by Bechtel during such month (which amount shall be reduced by any\namounts offset or credited by Webvan against such Recoverable Costs on account\nof Webvan's prior overpayments, as hereinafter provided), then Webvan shall have\nthe right either to offset and credit the \n\n\n\n 20\n 22\n\namount of such overpayment against Bechtel's estimate of Recoverable Costs to be\nprovided during the current month or to require that Bechtel promptly refund to\nWebvan the amount of such overpayment; and (b) if the amount of estimated\nRecoverable Costs paid by Webvan for any month is less than the amount of actual\nRecoverable Costs incurred by Bechtel during such month, then the amount of such\nshortfall shall be paid by Webvan to Bechtel at the same time that Webvan pays\nBechtel's reasonable estimate of Recoverable Costs for Consultant Services to be\nprovided during the following month.\n\n 5.1.1.4 Webvan shall pay Bechtel for each monthly invoice\nsubmitted to Webvan within [*] days after Webvan's receipt of such invoice,\nunless prior to the expiration of such [*]-day period, Webvan advises Bechtel\nthat Webvan disagrees with the invoice submitted or disapproves the Consultant\nServices performed. If an invoice is in question, Bechtel and Webvan shall\nforthwith attempt to resolve the issue. Webvan shall pay the undisputed portion\nof each invoice within [*] days after receipt thereof. Undisputed amounts due\nand payable to Bechtel shall bear interest, from thirty (30) days after the\napplicable invoice was received until paid by Webvan, at the Default Rate. When\nrequested by Webvan, Bechtel shall submit applicable lien waivers with its\ninvoices stating that for that specific portion of Consultant Services for which\nWebvan has paid all labor, material and subcontractor and subconsultant accounts\nhave been duly paid. All such lien waivers (other than lien waivers to be\nprovided promptly following final payments to Subconsultants and Subcontractors)\nmay be conditioned upon receipt of payment for the invoiced labor and materials.\nUpon completion of the Consultant Services set forth in a Notice to Proceed and\npromptly after receiving final payment for such Services, Bechtel shall submit\nsuch unconditional lien waivers and payment affidavits as Webvan may reasonably\nrequire.\n\n 5.1.2 Recoverable Costs. Bechtel shall be entitled to reimbursement for\nthe following costs and expenses (collectively, the \"RECOVERABLE COSTS\"): (i)\nthe cost of Bechtel employees performing Consulting Services as provided in the\nUnit Rate Schedule attached hereto as Appendix 5.1.2 and made a part hereof,\n(ii) ordinary and reasonable expenses of relocation, transportation (coach or\nequivalent class only), and subsistence (or per diem, as applicable) in\nconnection with such Consultant Services (excluding travel within the San\nFrancisco Bay Area or within the other localities in which the DC Projects are\nlocated), in accordance with reasonable policies and procedures established by\nBechtel; (iii) long-distance communications, facsimile communications (long\ndistance only), courier services, and express mail; (iv) ordinary and reasonable\nexpenses of reproduction, postage and handling of drawings, specifications and\nother documents (not for internal use); (v) if authorized in advance in writing\nby Webvan, expense of overtime work by non-exempt employees requiring higher\nthan regular rates; (vi) ordinary and reasonable expenses of renderings, models\nand mock-ups requested in writing by Webvan; (vii) ordinary and reasonable\nexpenses of photographic production techniques and photography and photo prints\nused for a DC Project; (viii) the purchase prices actually paid by Bechtel for\nFF&E title to which has been transferred to Webvan in accordance with Section\n2.6; and (ix) ordinary and reasonable fees and costs incurred by Bechtel's\napproved Subconsultants in performing Consultant Services, which fees and costs\nof Subconsultants shall be evidenced by invoices (copies of which are provided\nto Webvan) providing in reasonable detail the actual amount of time billed by\nthe employees of such Subconsultants, a description of the work performed, and a\ndetailed description of any and all approved Recoverable Costs incurred by such\nSubconsultants. Any and all other costs and expenses incurred by Bechtel in\nperforming the Consultant Services which are not covered in the preceding\nsentence shall require the prior written approval of Webvan and unless such\nprior approval is given, Webvan shall not reimburse Bechtel for such costs and\nexpenses. Bechtel shall review all accounts for reimbursables of its\nSubconsultants and Subcontractors before submitting the same to Webvan for\npayment and confirm to Webvan if so requested, in writing, that such\nreimbursables are reasonable and necessary and were \n\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 21\n 23\n\nincurred by Subconsultants and Subcontractors in the performance of their duties\non behalf of the Project.\n\n5.2 Construction Services.\n\n 5.2.1 Applications for Payment. Not later than the first (1st) business\nday of each calendar month, Bechtel shall submit to Webvan a separate\napplication for payment for the prior month (\"APPLICATION FOR PAYMENT\") for each\nDC Project for which Bechtel is then rendering Construction Services, which\napplication shall also include any portions of the DC Project work completed\nduring periods of time covered by previously submitted Applications for Payment\nto the extent such portions of the DC Project work were not shown on any such\nprevious applications. Each Application for Payment shall be for a sum equal to:\n(i) that portion of the Cost of the Work incurred during the period covered by\nthe particular application, determined in accordance with the Schedule of\nValues, calculated on the basis of the percentage of the DC Project work\ncompleted during such month, provided that no payment to Bechtel for DC Project\nwork performed shall exceed the actual Cost of the Work performed (together with\nany items applicable to the period covered by any preceding Application for\nPayment to the extent such items were not reflected in any such Application for\nPayment); and (ii) that portion of the Bechtel Fee applicable to the percentage\nof the DC Project work completed during the prior month. In no event, however,\nshall the Cost of the Work set forth in any Application for Payment for a DC\nProject, when added to all amounts previously invoiced for the Cost of the Work\nfor the DC Project, represent a percentage of the Budgeted Cost greater than the\ncompleted percentage of the total DC Project work to be performed under the\nContract Documents.\n\n 5.2.1.1 Bechtel shall include with each Application for Payment\nback-up material satisfactory to Webvan to support all components of the\napplication, including, without limitation, verifiable Subcontractor payment\napplications, current month as-built information, and actual Cost of the Work,\nindicating in detail all monies paid out or to be paid out for costs incurred on\naccount of the Cost of the Work.\n\n 5.2.1.2 In each Application for Payment, including the Final\nApplication for Payment upon the Final Completion of the DC Project, Bechtel\nshall certify that: (i) the Application for Payment represents a just estimate\nof the costs then due Bechtel under the terms of this Contract; (ii) all DC\nProject work covered by the Application for Payment has been completed in\naccordance with the applicable Contract Documents; (iii) there are no known\nunbonded Mechanics' Liens outstanding at the date of the Application for\nPayment; (iv) all due and payable bills (except for amounts in dispute with\nSubcontractors) with respect to the DC Project work have been paid to date or\nare included in the amount requested in the Application for Payment; (v) there\nis no known basis for the filing of any Mechanics' Liens for or relating to the\nDC Project work except for (a) unpaid bills included in the Application for\nPayment, all of which will be paid from the amount due to Bechtel with respect\nto the Application for Payment, or (b) amounts in dispute with Subcontractors;\n(vi) subject to receipt of payment, Bechtel waives any Mechanics' Lien rights to\nthe extent of such payments; (vii) there is no default, or event which with the\npassage of time or giving of notice, or both, could constitute a default under\nthis Contract or under any Subcontract; (viii) the remaining balance of the\napplicable Budgeted Cost is sufficient, in Bechtel's reasonable estimation, to\ncomplete construction of the remaining portion of the applicable DC Project\nwork; and (ix) the DC Project work which is the subject of the Application for\nPayment has been performed in accordance with the Contract Documents and all\napplicable Laws.\n\n 5.2.1.3 Each Application for Payment shall include conditional\nlien releases from Bechtel and all Subcontractors for all DC Project work which\nis the subject of the Application for \n\n\n\n 22\n 24\n\nPayment in the form required by applicable Law. Promptly after Webvan's payment\npursuant to each Application for Payment that includes any final amount to be\npaid to a Subcontractor, Bechtel shall deliver to Webvan an unconditional\nMechanics' Lien release from such Subcontractor in the form required by\napplicable Law for all DC Project work performed by such Subcontractor.\n\n 5.2.1.4 Requests for payment for materials stored on-site or\noff-site shall be limited to materials on a list approved by Webvan. Webvan will\nnot pay for on-site materials such as drywall or any other commodity-like\nmaterial until it is in place as a part of the DC Project work.\n\n 5.2.1.5 As a condition of payment, Bechtel shall submit a detailed\nconstruction report to Webvan each month, in a form satisfactory to Webvan and\ntogether with the Application for Payment a separate, detailed construction\nreport for each DC Project for which Webvan is then rendering Construction\nServices. The report shall contain pertinent information on the following\naspects of the DC Project: (i) past month's activities; (ii) current month's\nactivities; (iii) current problems; (iv) Webvan action required; (v) progress\nbilling which shall include actual expenditures to date in reasonable detail;\n(vi) updated Project Schedule; (vii) Change Order log and (viii) projected\nmonthly cash expenditures for the remainder of the applicable DC Project.\n\n 5.2.1.6 Bechtel warrants that title to all DC Project work and\nmaterials covered by an Application for Payment (including, without limitation,\nall Operating Equipment) will pass to Webvan either by incorporation in the\nconstruction or upon the receipt of payment by Bechtel, whichever occurs later,\nfree and clear of all Mechanics' Liens, claims, charges, liens, security\ninterests or encumbrances of any kind. As a condition to Webvan's obligation to\nmake any payment pursuant to an Application for Payment, Bechtel shall execute\nand deliver to Webvan bills of sale and other documents reasonably requested by\nWebvan transferring to Webvan such title to all materials and equipment\n(including, without limitation, Operating Equipment) the cost of which is\nincluded in such Application for Payment.\n\n 5.2.2 Payments to Bechtel.\n\n 5.2.2.1 Webvan will review each Application for Payment and will\npromptly take appropriate action thereon as provided in the applicable Contract\nDocuments. The amount agreed upon for payment shall be payable by Webvan no\nlater [*] days after Webvan's receipt of a complete and accurate\nApplication for Payment, but no sooner than the tenth (10th) day of the month.\n\n 5.2.2.2 Payment by Webvan with respect to any Application for\nPayment shall not constitute Webvan's approval or acceptance of any item or cost\nin such Application for Payment, nor shall it be construed to be final\nacceptance or approval of that part of the DC Project work to which the payment\nrelates, nor shall it relieve Bechtel of any of its obligations under this\nContract.\n\n 5.2.2.3 Except as otherwise provided in Section 2.5.1, with\nrespect to each Application for Payment, Webvan shall pay Bechtel an amount\nequal to the Cost of the Work and the Bechtel Fee then payable according to the\nSchedule of Values. Any provision to the contrary in this Contract or any other\nContract Documents notwithstanding, in the event of a disputed claim between\nWebvan and Bechtel with respect to any amount or circumstance covered by any\nApplication for Payment, Webvan may withhold from the payment in question an\namount sufficient to reimburse Webvan for its expenditures and to secure (i)\ncorrection or re-execution of DC Project work which is defective or has not been\nperformed in accordance with the Contract Documents; (ii) past due payments to\nSubcontractors; (iii) Webvan's remedies in consequence of any default by Bechtel\nunder this Contract; and (iv) any costs incurred by Webvan as a result of\nclaims, liabilities, losses and other damages covered \n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 23\n 25\n\nby Bechtel's indemnification obligations pursuant to Section 8.16. If Webvan, in\nits good faith judgment, determines that the portion of the Budgeted Cost then\nremaining unpaid will not be sufficient to complete the applicable DC Project\nwork in accordance with this Contract, then no additional payments, including\nany payments in respect of the Bechtel Fee, will be due Bechtel hereunder unless\nand until Bechtel performs a sufficient portion of the work so that such portion\nof the Budgeted Cost then remaining unpaid is determined by Webvan to be\nsufficient to complete the DC Project work.\n\n 5.2.2.4 In no event shall any interest be due and payable by\nWebvan to Bechtel, any Subcontractor, Subconsultant or any other party on any of\nthe sums properly retained by Webvan pursuant to any of the terms or provisions\nof any of the Contract Documents.\n\n 5.2.2.5 In taking action on each Application for Payment, Webvan\nshall have the right to rely on the accuracy and completeness of the information\nfurnished by Bechtel. Webvan shall not be deemed to have made audits of the\nsupporting data or exhaustive or continuous on-site inspections or any other\nexamination to ascertain how or for what purposes Bechtel has used the monies\npreviously paid on account of this Contract.\n\n 5.2.2.6 Except for the Bechtel Fee and any amounts payable to\nBechtel under Section 5.6 or Section 5.7, all sums paid to Bechtel pursuant to\nthis Contract shall be used for the performance of the DC Project work and for\nno other purpose whatsoever. To the extent applicable, all sums paid to Bechtel\nin turn shall be paid promptly (but in no event later than the time period\npermitted under applicable Law) to the respective Subcontractors and\nSubconsultants.\n\n 5.2.2.7 Subject to Subparagraph 5.2.2.4, payments due and unpaid\nunder any Application for Payment for fifteen (15) days shall bear interest,\nfrom thirty (30) days after the particular Application for Payment in question\nwas received until paid, at the Default Rate.\n\n 5.2.2.8 If, in connection with any DC Project work for which\nWebvan has paid Bechtel as required by this Contract, any Mechanics' Lien is\nfiled or served on Webvan or on any lender or landlord with respect to the DC\nProject or the applicable DC Property, then Webvan shall have the right to\nwithhold from any sums otherwise payable to Bechtel, an amount sufficient to\ndischarge any or all such Mechanics' Liens. Releases or receipted vouchers in\nsettlement of such Mechanics' Liens, or other security satisfactory to Webvan,\nmust be furnished to Webvan by Bechtel before the withheld sums will be paid to\nBechtel. If Bechtel has not settled or provided acceptable security for any such\nMechanics' Liens within a reasonable time, not to exceed fifteen (15) days after\nthe date on which such Mechanics' Lien is asserted, then Webvan shall have the\nright, but not the obligation, to discharge any or all such Mechanics' Liens out\nof the withheld sums. Notwithstanding the foregoing, Bechtel shall have the\nright to bond over the Mechanics' Lien, in an amount not less than one hundred\nfifty percent (150%) of the Mechanics' Lien, and receive payment if the effect\nof such bonding under applicable Law is to release the Mechanics' Lien from the\nreal property at which the DC Project is located (the \"DC PROPERTY\").\n\n 5.2.2.9 Except as otherwise set forth below, the entire unpaid\nbalance due Bechtel on account of the Cost of the Work and the Bechtel Fee, with\nrespect to the applicable DC Project (the \"FINAL PAYMENT\"), shall be due to\nBechtel within [*] days after the date on which the final approvals\nfrom the appropriate governmental authorities of satisfaction of all terms and\nconditions and other provisions of all necessary permits and approvals\n(including, without limitation, all food, health and safety permits and\napprovals) authorizing the full use and occupancy of the DC Project (including\nthe Operating Equipment) as contemplated by the Contract Documents\n(collectively, a \"CERTIFICATE OF \n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n\n 24\n 26\n\nOCCUPANCY\") are issued for the DC Project, provided that all of the following\nhave occurred: (i) a copy of such final approvals from the appropriate\ngovernmental authorities shall have been delivered to Webvan; (ii) Bechtel shall\nhave certified, in writing, that the Development of the DC Project and\nperformance of all of the DC Project work and Services has been completed in\naccordance with the Contract Documents, subject only to minor, corrective Punch\nList items which do not in any way interfere with Webvan's use, operation or\noccupancy of the DC Project, which shall be noted on such certification (an\namount equal to [*] to complete such items may be withheld by Webvan); (iii)\nBechtel's certificate described in the foregoing clause (ii) shall in fact be\ntrue, complete and correct; (iv) the applicable requirements of Section 5.2.1\n(regarding Applications for Payment) shall have been met (including, without\nlimitation, Bechtel's delivery to Webvan of all bills of sale and other\ndocuments described in Section 5.2.1.6); (v) Bechtel shall have delivered to\nWebvan a waiver of Mechanics' Lien rights, complying with applicable Law,\nconditioned only upon receipt of the funds requested in the Final Application\nfor Payment, and executed by Bechtel and by each person or entity entitled to\nrecord a Mechanics' Lien against the DC Project or the DC Property (or, if any\nSubcontractor refuses to furnish such waiver, then a lien bond in form,\nsubstance and amount satisfactory to Webvan, protecting Webvan any lender or\nlandlord and the DC Project and the DC Property from Mechanics' Liens by such\npersons); (vi) Bechtel shall have delivered to Webvan (a) an affidavit in a form\nsatisfactory to Webvan stating that the Final Payment is being requested and\nthat the Mechanics' Lien releases and\/or bonds delivered to Webvan include and\ncover all materials, labor, and services for which a Mechanics' Lien could be\nfiled against the DC Project or the DC Property and (b) such other affidavits\nand agreements reasonably required by Webvan's and\/or Webvan's landlord's title\ninsurers as a condition to insuring Webvan's and\/or Webvan's landlord's title to\nthe DC Project and the DC Property free and clear of any Mechanics' Liens; and\n(vii) Bechtel shall have delivered to Webvan one complete set of \"as built\"\ndrawings and one electronic copy, which shall be furnished in AutoCAD for\nWindows, or a similar format reasonably acceptable to Webvan, and all\nguaranties, warranties, operating and maintenance manuals applicable to the\nportion of the work in question and\/or required by the Construction Documents.\n\n 5.2.2.10 In the event of a disputed claim between Webvan and\nBechtel with respect to any amount or circumstance covered by any Final\nApplication for Payment, Webvan may withhold from the Final Payment in question\nan amount not to exceed [*].\n\n 5.2.2.11 Bechtel shall file all notices of completion or notices\nor filings of similar import for the applicable DC Project work within ten (10)\ndays of the issuance of a Certificate of Occupancy for the DC Project work in\nquestion in accordance with applicable Law and local custom and practice.\n\n5.3 Design Services.\n\n 5.3.1 Payment.\n\n 5.3.1.1 Bechtel shall prepare and attach to any Notice to Proceed\nexecuted by Bechtel for Design Services a comprehensive, line-item budget\ndescribing in reasonable detail each Design Service to be provided by Bechtel\n(including, without limitation, Schematic Design Services, Design Development\nServices and Construction Documents Services) and specifying Bechtel's\nreasonable estimate of the Recoverable Costs (as described in Section 5.3.2\nbelow) that will be incurred for each such Design Service. For Design Services\nperformed by Bechtel in accordance with such a Notice to Proceed executed by\nWebvan, Webvan shall pay Recoverable Costs (as described in Section 5.3.2 \n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n\n 25\n 27\n\nbelow) to Bechtel on a monthly basis. Webvan shall not, however, have any\nobligation to pay for any Recoverable Costs for Design Services in excess of the\nRecoverable Costs estimated by Bechtel in the budget for such Design Services\nattached to the Notice to Proceed executed by Webvan, unless Webvan has\npreviously agreed in writing to pay such excess Recoverable Costs. Similarly,\nBechtel shall have no obligation to perform Design Services to the extent the\nRecoverable Costs therefor exceed the total amount of Recoverable Costs\nspecified in such budget, unless Webvan agrees in writing to pay such additional\nRecoverable Costs. If, in the course of performing Design Services, Bechtel\ndetermines that the amount of Recoverable Costs that will be incurred for such\nDesign Services exceeds the total amount of such Recoverable Costs provided in\nsuch budget, then Bechtel shall give Webvan written notice thereof as soon as\nreasonably possible and shall deliver to Webvan a revised budget for such Design\nServices.\n\n 5.3.1.2 On or before the tenth (10th) day of the first month in\nwhich Bechtel is to provide Design Services for a particular DC Project, Bechtel\nshall submit to Webvan an invoice of the amount of Recoverable Costs for Design\nServices that Bechtel reasonably estimates that it will incur during such first\nmonth. On or before the tenth (10th) day of the second month in which Bechtel is\nto provide Design Services for such DC Project and continuing each month\nthereafter until the month following the last month in which Design Services are\nprovided by Bechtel for such DC Project, Bechtel shall submit to Webvan an\ninvoice that states (a) the estimated amount of Recoverable Costs paid in\nadvance by Webvan for the prior month, (b) the actual amount of Recoverable\nCosts incurred by Bechtel during the prior month, and (c) the amount of\nRecoverable Costs that Bechtel reasonably estimates that it will incur during\nthe current month. Each such invoice shall (1) be in a form reasonably\nacceptable to Webvan, (2) provide in reasonable detail the actual amount of time\nspent daily by each Bechtel employee, a description of work performed, and the\ntotal Unit Rate costs allocable to such employee's work for each day during the\nprior month, and a reasonable estimate of the work to be provided by Bechtel\nemployees during the current month, (3) describe in detail the Recoverable Costs\nactually incurred by Bechtel during the prior month, and a reasonable estimate\nof the type and amount of Recoverable Costs that Bechtel will incur during the\ncurrent month, and (4) provide a reconciliation of the actual Recoverable Costs\nincurred by Bechtel during the prior month against the estimate of the\nRecoverable Costs paid by Webvan for such prior month.\n\n 5.3.1.3 Notwithstanding anything contained in any invoice\nsubmitted by Bechtel, (a) if the amount of estimated Recoverable Costs paid by\nWebvan for any month is greater than the amount of actual Recoverable Costs\nincurred by Bechtel during such month (which amount shall be reduced by any\namounts offset or credited by Webvan against such Recoverable Costs on account\nof Webvan's prior overpayments, as hereinafter provided), then Webvan shall have\nthe right either to offset and credit the amount of such overpayment against\nBechtel's estimate of Recoverable Costs to be provided during the current month\nor to require that Bechtel promptly refund to Webvan the amount of such\noverpayment; and (b) if the amount of estimated Recoverable Costs paid by Webvan\nfor any month is less than the amount of actual Recoverable Costs incurred by\nBechtel during such month, then the amount of such shortfall shall be paid by\nWebvan to Bechtel at the same time that Webvan pays Bechtel's reasonable\nestimate of Recoverable Costs for Design Services to be provided during the\nfollowing month.\n\n 5.3.1.4 Webvan shall pay Bechtel for each monthly invoice\nsubmitted to Webvan within [*] days after Webvan's receipt of such invoice,\nunless prior to the expiration of such [*]-day period, Webvan advises Bechtel\nthat Webvan disagrees with the invoice submitted or disapproves the Design\nServices performed. If an invoice is in question, Bechtel and Webvan shall\nforthwith attempt to resolve the issue. Webvan shall pay the undisputed portion\nof each invoice within [*] days after receipt thereof. Undisputed amounts due\nand payable to Bechtel shall bear interest, \n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n\n 26\n 28\n\nfrom thirty (30) days after the applicable invoice was received until paid by\nWebvan, at the Default Rate. When requested by Webvan, Bechtel shall submit\napplicable lien waivers with its invoices stating that for that specific portion\nof Design Services for which Webvan has paid all labor, material and\nsubcontractor and subconsultant accounts have been duly paid. All such lien\nwaivers (other than lien waivers to be provided promptly following final\npayments to Subconsultants and Subcontractors) may be conditioned upon receipt\nof payment for the invoiced labor and materials. Upon completion of the Design\nServices set forth in a Notice to Proceed and promptly after receiving final\npayment for such Services, Bechtel shall submit such unconditional lien waivers\nand payment affidavits as Webvan may reasonably require.\n\n 5.3.2 Recoverable Costs. Bechtel shall be entitled to reimbursement for\nthe following Recoverable Costs for Design Services: (i) the cost of Bechtel\nemployees performing Design Services as provided in the Unit Rate Schedule\nattached hereto as Appendix 5.1.2, (ii) ordinary and reasonable expenses of\nrelocation, transportation (coach or equivalent class only) and subsistence (or\nper diem, if applicable) in connection with such Design Services (excluding\ntravel within the San Francisco Bay Area or within the other localities in which\nthe DC Projects are located) in accordance with reasonable policies and\nprocedures established by Bechtel; (iii) long-distance communications, facsimile\ncommunications (long distance only), courier services, and express mail; (iv)\nordinary and reasonable expenses of reproduction, postage and handling of\ndrawings, specifications and other documents (not for internal use); (v) if\nauthorized in advance in writing by Webvan, expense of overtime work by\nnon-exempt employees of Bechtel or any approved Subconsultants requiring higher\nthan regular rates; (vi) ordinary and reasonable expenses of renderings, models\nand mock-ups requested in writing by Webvan; (vii) ordinary and reasonable\nexpenses of photographic production techniques and photography and photo prints\nused for a DC Project; and (viii) ordinary and reasonable fees and costs\nincurred by Bechtel's approved Subconsultants in performing Design Services,\nwhich fees and costs of Subconsultants shall be evidenced by invoices (copies of\nwhich are provided to Webvan) providing in reasonable detail the actual amount\nof time billed by the employees of any such Subconsultants, a description of the\nwork performed, and a detailed description of any and all approved Recoverable\nCosts incurred by such Subconsultant. Any and all other costs and expenses\nincurred by Bechtel in performing the Design Services which are not covered in\nthe preceding sentence shall require the prior written approval of Webvan and\nunless such prior approval is given, Webvan shall not reimburse Bechtel for such\ncosts and expenses.\n\n5.4 Entire Compensation. Bechtel specifically understands that the\ncompensation set forth in this Section 5 and the Notices to Proceed is the sole\ncompensation payable to Bechtel by Webvan for all Services and no work\nundertaken by Bechtel or its agents, employees, Subcontractors or Subconsultants\nwill result in any obligation of Webvan to pay any additional compensation or\nany additional expense reimbursement not expressly authorized in this Section 5,\nin the absence of a formal, duly authorized and executed written Notice to\nProceed for such services and Webvan's approval of the maximum cost payable for\nsuch additional services. Bechtel, for itself and its employees, agents,\nSubcontractors and Subconsultants hereby (i) waives any right to compensation or\nreimbursement for services performed or expenses incurred (a) without written\nauthorization pursuant to an approved Notice to Proceed or (b) in excess of the\namounts set forth in an approved Notice to Proceed, and (ii) covenants not to\nsue for amounts which might otherwise be payable under the theory of quantum\nmeruit, or under any other legal theory, except to the extent Bechtel is\nexpressly entitled to payment under Section 5 of this Contract.\n\n\n\n 27\n 29\n\n5.5 Books and Records.\n\n 5.5.1 Bechtel shall check all materials, equipment and labor being\nincorporated into Project work and shall keep such full and detailed accounts as\nmay be necessary for proper financial management under this Contract. Webvan\nshall have access to all Bechtel's records, books, correspondence, instructions,\ndrawings, receipts, vouchers, memoranda and similar data relating to this\nContract and\/or Project work or Services, and Bechtel shall preserve (either in\nhard copy or on electronic storage) all such records for a period of four (4)\nyears following Final Payment for each DC Project, or for any longer period\nrequired by Law. Webvan shall have the right to copy all or any part of\nBechtel's job records.\n\n 5.5.2 All Services shall be performed by Bechtel on an \"open book\"\nbasis. Webvan shall have the right, during the performance of the Services and\nfor a period of four (4) years after Final Payment for each DC Project has been\nmade, to inspect and audit Bechtel's books and records regarding the Project,\nexcept that Webvan shall not have the right to audit the basis for the Unit\nRates described in Appendix 5.1.2 or any other fixed rates or fixed prices that\nBechtel and Webvan may agree to as the basis for compensation. Bechtel shall\nhave the opportunity to audit itself prior to any audit by Webvan. Should any\novercharge be found by Bechtel's audit, Bechtel shall pay Webvan an amount equal\nto the amount overcharged plus interest at the Default Rate (including any part\nof the Bechtel Fee based on such overcharge). After Bechtel's audit, if any such\naudit by Webvan reveals that the amounts charged to Webvan by Bechtel exceeded\nthe actual compensation to which Bechtel was entitled for Services, then Bechtel\nshall pay Webvan an amount equal to the amount overcharged plus interest at the\nDefault Rate (including any part of the Bechtel Fee based on such overcharge)\nand shall pay for the cost of the audit if the net amount overcharged exceeds\nTen Thousand Dollars ($10,000) per occurrence.\n\n5.6 Cost Incentive.\n\n 5.6.1 For purposes of this Contract, [*] Notwithstanding anything in\nthis Section 5.6 to the contrary, however, the aggregate amount payable to\nBechtel under this \n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n\n 28\n 30\n\nSection 5.6 for any particular DC Project shall in no event exceed [*].\n\n 5.6.2 [*].\n\n5.7 Time Incentive. If the Substantial Completion of a particular DC Project\noccurs before the date (the \"SCHEDULED DATE\") specified for Substantial\nCompletion in the then-current Project Schedule approved by Webvan and the\nNotice to Proceed executed by Webvan for such DC Project (as such date may be\nadjusted pursuant to Change Orders executed by Webvan for such DC Project in\naccordance with Section 2.5.4.1), and if at the time of such Substantial\nCompletion no Event of Default by Bechtel exists under the Contract Documents\nnor has any event or condition been identified which (with the giving of notice\nor the passage of time or both) could constitute such an Event of Default, then\nWebvan shall pay Bechtel, concurrently with the Final Payment for such DC\nProject, an amount (the \"TIME INCENTIVE AMOUNT\") equal to the sum of the\nfollowing: [*].\n\n 5.8 Incentive Warrant. Concurrently with Bechtel's and Webvan's\nexecution and delivery of this Contract, Webvan has delivered to Bechtel a\nwarrant (the \"WARRANT\") in the form of Appendix 5.8 attached hereto and made a\npart hereof for the purchase of up to six hundred thousand (600,000) shares of\npreferred stock of Webvan. As provided in the Warrant, Bechtel's rights under\nthe Warrant shall vest with respect to certain shares of preferred stock of\nWebvan only when the DC Project has been completed On Time\/On Budget. For\npurposes of the Warrant, \"ON TIME\/ON BUDGET\" shall mean, with respect to any\nparticular DC Project, that [*]\n \n\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 29\n 31\n[*] Except as expressly provided in this Section 5.8, under no circumstance\nshall a DC Project be deemed to have been completed On Time\/On Budget if [*].\nNotwithstanding the foregoing clause (ii), if [*] then Bechtel shall be deemed\nto have satisfied the requirement of clause (ii) of this Section 5.8 for\npurposes of determining whether such DC Project has been completed On Time\/On\nBudget.\n\n6.0 TERMINATION OF CONTRACT\n\n6.1 Bechtel's Termination Rights.\n\n 6.1.1 Bechtel may suspend the Services for a particular DC Project (i)\nif Webvan fails to pay or to object to an Application for Payment or invoice for\nConsulting Services or Design Services for such DC Project within thirty (30)\ndays after written notice of delinquency is received by Webvan from Bechtel,\n(ii) pursuant to an order of any court or other public authority having\njurisdiction, or (iii) as a result of an act of government, such as a\ndeclaration of a national emergency, making materials unavailable.\n\n 6.1.2 For purposes of this Section 6.1.2, (a) the \"OUTSTANDING AMOUNT\"\nshall equal the sum of all amounts (without duplication) both (i) that are\nspecified as due and payable in all Applications for Payment for Construction\nServices and all invoices for Consultant Services and Design Services that\nBechtel has properly completed and submitted (including all related\ndocumentation required under the Contract Documents) and (ii) that Webvan has\nnot paid; and (b) the \"PAST-DUE AMOUNT\" shall equal that portion of the\nOutstanding Amount as to which Webvan has neither objected nor made payment\nwithin [*] after Webvan's receipt of the Applications for Payment and invoices\ntherefor. If at any time during the term of this Contract the Past-Due Amount\nexceeds [*] for a period of five (5) consecutive days, then Bechtel shall have\nthe right to give Webvan written notice (a \"PAST-DUE NOTICE\") of such event.\nBechtel shall specify in any Past-Due Notice the Past-Due Amount as of the date\nof such Past-Due Notice, and Bechtel shall attach to any Past-Due Notice copies\nof all Applications for Payment for Construction Services and copies of all\ninvoices for Consultant Services and Design Services evidencing the unpaid\namounts which, when added together, constitute the Past-Due Amount specified in\nBechtel's Past-Due Notice. Webvan shall have five (5) days after Webvan's\nreceipt of a Past-Due Notice within which either to pay the Past-Due Amount\nspecified by Bechtel or to give Bechtel written notice that Webvan objects to\nBechtel's calculation of such Past-Due Amount. Any such objection to Bechtel's\ncalculation of such Past-Due Amount may be based only upon Webvan's assertion\n(1) that Bechtel's calculation includes an arithmetic error or (2) that Bechtel\nhas included in such calculation amounts that Webvan either paid or objected to\nwithin fifteen (15) days after Webvan's receipt of the applicable Applications\nfor Payment and invoices. If Webvan has not paid or so objected to such Past-Due\nAmount on or before the fifth (5th) day after Webvan's receipt of such Past-Due\nNotice, then Bechtel shall have the right (by giving Webvan written notice\nthereof) to suspend performance of any or all Services. If both (a) Webvan has\nnot timely objected to Bechtel's calculation of \n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n 30\n 32\n\nsuch Past-Due Amount in the manner hereinabove provided, and (b) on or before\nthe thirty-fifth (35th) day after Webvan's receipt of such Past-Due Notice,\nWebvan has not paid such Past-Due-Amount, then Bechtel shall have the right to\nterminate this Contract by giving Webvan written notice of such termination.\nFollowing any such termination of this Contract by Bechtel, Bechtel shall have\nthe right to recover from Webvan payment for all Services completed for the\nProject as of the date of such termination. If Webvan objects to Bechtel's\ncalculation of the Past-Due Amount specified in any Past-Due Notice, the dispute\nshall be resolved in accordance with Section 2.5.12. Any period during which\nBechtel has properly suspended performance of Services pursuant to this Section\n6.1.2 shall constitute an Excusable Delay with respect to each DC Project as to\nwhich Bechtel has properly suspended performance.\n\n 6.1.3 Webvan may, at any time and without cause, order Bechtel, in\nwriting, to suspend the Services in whole or in part for such period of time as\nWebvan may determine. If Bechtel's work as to a particular DC Project is\nsuspended pursuant to any such written order of Webvan for a period of thirty\n(30) consecutive days or more, then Bechtel shall have the right to terminate\nthis Contract as to such DC Project only and to recover from Webvan payment for\nall Services completed for such DC Project as of the date of termination.\n\n 6.1.4 [*].\n\n 6.1.5 Upon any termination of this Contract by Bechtel pursuant to this\nSection 6.1, Webvan and Bechtel shall have the same rights and obligations as if\nWebvan had terminated this Contract under Section 6.2.\n\n6.2 Webvan's Right to Terminate Without Cause. The following provisions of\nthis Section 6.2 shall govern Webvan's right to terminate this Contract without\ncause.\n\n 6.2.1 In addition to Webvan's right to terminate on account of Bechtel's\ndefault, as set forth in Section 6.4, Webvan may terminate this Contract and\/or\nthe Services, in whole or in part, at any time and from time to time without\ncause, by giving Bechtel at least ten (10) days' prior written notice. Upon\nreceipt of any such notice, Bechtel shall, unless the notice directs otherwise:\n(i) immediately discontinue the Services on that date and to the extent\nspecified in the notice; (ii) enter into no further Subcontracts or\nSubconsultant agreements, except as may be necessary for completion of such\nportion of the DC Project work or Services as is not discontinued; (iii)\npromptly make every reasonable effort to procure cancellation, or assignment,\nupon terms satisfactory to Webvan, of all Subcontracts and all Subconsultant\nagreements to the extent they relate to the performance of the discontinued\nportion of the DC Project work and other Services; and (iv) thereafter, with\nrespect to the DC Project(s) as to which Webvan has terminated this Contract, do\nonly such DC Project work as may be necessary to preserve and protect the DC\nProject work already in progress and to protect materials, landscaping materials\nand equipment on the DC Property(ies) or in transit thereto. Upon such\ntermination, the obligations of the parties under this Contract shall continue\nas to DC Projects and\/or Services as to which Webvan has not terminated this\nContract and, with respect to the DC Project(s) as to which Webvan has\nterminated this Contract, those portions of the Services already performed by\nBechtel prior to the date of termination. In addition, Bechtel shall take all\nsteps, including the legal assignment of its contractual rights with respect to\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 31\n 33\n\nterminated Project work, which Webvan may require for the purpose of fully\nvesting in Webvan such contractual rights. Notwithstanding any such assignment\nof contractual rights, however, Bechtel shall reserve rights of recourse\nthereunder to the extent necessary to permit Bechtel to enforce such contracts\nin the event that Webvan makes any claim against Bechtel with respect to goods\nor services that are the subject of such contracts. The foregoing reservation of\nrights by Bechtel shall not, however, in any way impair Webvan's right to pursue\ndirect recourse against the parties to such contracts.\n\n 6.2.2 In the event of such termination by Webvan, Webvan shall reimburse\nBechtel for any unpaid Consultant Services, Design Services or Cost of the Work\ndue under Section 5, plus, in the case of Construction Services, an amount which\nwill increase the payments already made on account of the Bechtel Fee to a sum\nwhich bears the same ratio to such fixed sum as the actual Cost of the Work at\nthe time of termination bears to the Budgeted Cost. In addition, in the event of\nany such termination by Webvan of Construction Services, Webvan shall also pay\nto Bechtel (i) fair compensation, either by purchase or rental, at the election\nof Webvan, for any equipment Webvan wishes to continue to use, and (ii)\nreasonable and necessary costs actually incurred by Bechtel to relocate Bechtel\nemployees to their points of origin and to dispose of materials and equipment\nlocated at the applicable DC Property that Webvan does not purchase and other\nreasonable costs of termination actually incurred by Bechtel with Webvan's prior\nwritten approval. If, at the date of such termination, Bechtel has properly\nprepared or fabricated off the applicable site any goods for subsequent\nincorporation into DC Project work, and if Bechtel delivers such goods to the\napplicable site or to such other place as Webvan shall reasonably direct, then\nBechtel shall be paid for such goods or materials. Bechtel shall, as a condition\nto receiving the payments described in this Section 6, execute and deliver to\nWebvan such documents as may be reasonably acceptable to Webvan releasing Webvan\nand the applicable DC Properties from all liability to Bechtel under this\nContract, including, without limitation, the waiver of Mechanics' Lien rights\nand the affidavit described in clauses (v) and (vi) of Section 5.2.2.9.\n\n 6.2.3 Bechtel hereby waives all claims for damages and loss of\nanticipated profits on account of any termination by Webvan pursuant to this\nSection 6.2 and, as the sole right or remedy of Bechtel on account of such\ntermination, Bechtel shall have the right to receive the amounts payable to\nBechtel under this Section 6.2.\n\n6.3 Bechtel Default. Any of the following events shall be deemed to be a\nmaterial default by Bechtel under the Contract Documents (an \"EVENT OF\nDEFAULT\"): (i) failure by Bechtel to perform any material contractual obligation\nunder this Contract or the Contract Documents, which failure by its nature\nBechtel has no capacity to cure; (ii) failure by Bechtel to pay any monetary\nobligation under the Contract Documents for a period of five (5) days following\nreceipt of written notice of such failure from Webvan; (iii) failure by Bechtel\nto perform any other obligation under, or to comply with any term, provision or\ncondition of, the Contract Documents for a period of ten (10) days following\nreceipt of written notice of such failure from Webvan, or such longer period\n(but in no event exceeding forty-five (45) days following receipt of Webvan's\nnotice) as reasonably required to remedy such failure provided that Bechtel\ncommences such remedy within such ten (10)-day period and thereafter uses its\nbest efforts to complete such remedy at the earliest date reasonably possible;\n(iv) the occurrence of any of the following: (a) the making by Bechtel of any\ngeneral arrangement or assignment for the benefit of creditors; (b) Bechtel\nbecomes a \"debtor\" as defined in 11 USC Section 101 or any successor statute\n(unless, in the case of a petition filed against Bechtel, the same is dismissed\nwithin sixty (60) days); (c) the appointment of a trustee or receiver to take\npossession of substantially all of Bechtel's assets or of any asset used in\nconnection with the Project, where possession is not restored to Bechtel within\nthirty (30) days; or (d) the attachment, execution or other judicial seizure of\nsubstantially all of Bechtel's assets or of any asset used in connection with\nthe Project, where such seizure is not discharged within thirty (30) \n\n\n\n 32\n 34\n\ndays; and (v) repeated failure (defined as a failure for which Webvan has given\nmore than one (1) notice) by Bechtel to perform its obligations under this\nContract or the Contract Documents in a timely fashion, which failure materially\ninterferes with Webvan's scheduled completion of any DC Project within the\nContract Time provided in the Contract Documents.\n\n6.4 Webvan Remedies.\n\n 6.4.1 Upon the occurrence of an Event of Default, Webvan shall have the\nright (subject to Sections 6.4.2 and 8.17) to pursue any and all remedies\navailable at law and in equity including, without limitation, the following: (i)\nthe right to keep this Contract in effect and sue Bechtel for all damages caused\nby the default and recover the cost thereof; (ii) the right to cure any such\ndefault by Bechtel and to recover any damages caused thereby; and (iii) the\nright to terminate this Contract either as to the entire Project or as to any or\nall Services with respect to any DC Project as to which an Event of Default has\noccurred, in either case by giving Bechtel written notice of such termination.\nUpon such termination, Webvan shall have the right to complete the Services or\nto contract with others for completion of the Services and, in either event, to\ncharge the cost of completion to Bechtel. Webvan may deduct, offset and credit\nsuch costs of completion and all other damages incurred by Webvan as a\nconsequence of Bechtel's default from and against any amounts that may at any\ntime be payable to Bechtel under this Contract. If the cost of completion\nexceeds the amount that would have been payable under this Contract had Bechtel\ncompletely performed the Services pursuant to the terms of this Contract,\nBechtel shall immediately pay the amount of such excess to Webvan. Upon\ntermination, Bechtel shall be deemed to have waived all claims against Webvan\nfor profits, loss or damage on or with respect to the uncompleted Services.\n\n 6.4.2 If the Substantial Completion of any particular DC Project occurs\nafter the Scheduled Date for such DC Project, then Bechtel shall pay Webvan, no\nlater than the time Final Payment is payable to Bechtel, an amount (the\n\"LIQUIDATED DAMAGES AMOUNT\") equal to sum of the following: [*]. Webvan's\nrecovery of the Liquidated Damages Amount under this Section 6.4.2 shall\nconstitute Webvan's sole damages that may be recovered from Bechtel due to\nBechtel's failure to achieve Substantial Completion of a particular DC Project\nby the Scheduled Date for such DC Project. Nothing contained in this Section\n6.4.2, however, shall restrict Webvan from exercising any other right or remedy\nor from seeking or recovering any and all damages directly or indirectly\nresulting from any default of Bechtel under this Contract other than Bechtel's\nfailure to achieve Substantial Completion of a particular DC Project by the\nScheduled Date for such DC Project. Webvan may deduct, offset and credit the\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n\n\n 33\n 35\n\nLiquidated Damages Amount for any DC Project from and against any amounts that\nmay at any time be payable to Bechtel under this Contract, whether or not\npayable to Bechtel with respect to the same DC Project as to which the\nLiquidated Damages Amount has been incurred.\n\n6.5 Possession. If Webvan terminates this Contract with respect to\nConstruction Services for any DC Project on account of Bechtel's default as\nprovided in Section 6.4, then in addition to its obligations under Section 6.2,\nBechtel shall promptly and peaceably vacate all applicable DC Property and, at\nWebvan's election, Webvan may (i) take possession of such DC Property and of all\nmaterials, equipment, tools, construction equipment and machinery thereon owned\nby Bechtel and Webvan may finish the DC Project work by whatever method it may\ndeem expedient, or (ii) cease construction and require Bechtel promptly to\nremove from the DC Property, at Bechtel's expense, all materials, equipment,\ntools, and construction equipment owned by Bechtel. Webvan shall pay to Bechtel\nfair compensation (at the election of Webvan either by purchase at fair market\nvalue or by rental at the prevailing rate of the locale) for any equipment owned\nby Bechtel and used by Webvan during the completion of the DC Project. Upon\ndemand, (a) Bechtel shall assign and deliver to Webvan all Construction\nDocuments, Subcontracts, documents, tangible and intangible property, and\ncontractual rights as Webvan may demand for the purpose of completing the DC\nProject work, and (b) Bechtel shall execute and deliver to Webvan such written\ndocumentation as Webvan may request for the purpose of evidencing the vesting in\nWebvan of the rights and benefits of Bechtel with respect to the documents and\nrights so delivered and assigned.\n\n6.6 Compensation. If Webvan terminates this Contract with respect to\nConstruction Services for any DC Project as provided herein on account of\nBechtel's default, and Webvan then elects to complete the DC Project work,\nBechtel shall not be entitled to receive any further payments under this\nContract until the DC Project work is fully completed. Upon completion of the DC\nProject work, if the expenses reasonably incurred by Webvan in completing the DC\nProject work (including, without limitation, (a) payments made by Webvan to any\nparty supplying labor, materials, equipment, services and the like for the DC\nProject work, and (b) all costs incurred by Webvan for managerial,\nadministrative or supervisory services in excess of such costs that Webvan would\nhave incurred but for Bechtel's default), plus the amounts previously paid by\nWebvan to Bechtel, exceed any applicable Budgeted Cost and Bechtel Fee, then\nBechtel shall pay Webvan, upon demand, the amount of such excess, plus interest\nthereon at the Default Rate. In all other cases of termination for Bechtel's\ndefault, Webvan's liability to Bechtel shall be limited to reimbursement to\nBechtel of that portion of the applicable Budgeted Cost and Bechtel Fee which is\nearned, due and payable to Bechtel as of the date of the termination, less the\nsum of (i) any amounts owing to Webvan by Bechtel under the terms of the\napplicable Contract Documents, and (ii) all other amounts to which Webvan is\nentitled under the terms of this Contract as a result of Bechtel's default.\n\n7.0 INSURANCE\n\n7.1 Liability Insurance.\n\n 7.1.1 Bechtel shall purchase and maintain insurance which will protect\nBechtel and Webvan from the following types of claims that may arise out of or\nresult from Services under this Contract and for which Bechtel may be legally\nliable, whether such operations are by Bechtel or by a Subcontractor or\nSubconsultant or by anyone directly or indirectly employed by any of them, or by\nanyone for whose acts any of them may be liable: (i) claims under workers' or\nworkmen's compensation, disability benefit and other similar employee benefit\nacts which are applicable to the Services to be performed; (ii) claims for\ndamages because of bodily injury, sickness or disease, or death; (iii) claims\nordinarily covered by \n\n\n\n 34\n 36\n\ncommercial general liability insurance; (iv) claims for damages because of\ninjury to or destruction of tangible property, including loss of use by third\nparties other than Webvan resulting therefrom (whether resulting from operations\nof Bechtel, any Subcontractor or Subconsultant, or anyone directly or indirectly\nemployed by any of them); (v) claims for damages because of bodily injury, death\nof a person or property damage arising out of ownership, maintenance or use of a\nmotor vehicle; and (vi) claims involving contractual liability for Bechtel's\nindemnity obligations, if insurable, under this Contract. All insurance coverage\nrequired to be obtained and maintained by Bechtel pursuant to the terms of this\nContract and the Contract Documents shall be primary in the event of any loss,\nwith any insurance carried by Webvan to be excess capacity to Bechtel's\ncoverage. All insurance policies required of Bechtel by this Contract and any\nmodifications thereto shall be subject to Webvan's reasonable approval as to\nform, insurer, and adequacy of protection. Bechtel shall carry insurance with\ncoverage and limits of liability as specified in Appendix 7.1.1 to this\nContract, entitled \"Insurance Requirements.\" All insurance required by this\nSection 7.1.1 shall be purchased from and maintained with a company or companies\nlawfully authorized to do business in the State of California, who are\nincorporated admitted insurance companies in such State, and who have an A.M.\nBest Rating of at least A IX.\n\n 7.1.2 Bechtel shall require that each of its Subcontractors and\nSubconsultants obtain and maintain, at all times during the period such\nSubcontractor or Subconsultant is performing Services, the insurance described\nin Appendix 7.1.1.\n\n 7.1.3 All coverages shall be written on an occurrence basis and\nmaintained without interruption from date of commencement of the Services until\nthe date of completion of all Services and termination of any coverage required\nto be maintained after the completion of all Services; provided, however, that,\nsubject to Section 7.1.6, Bechtel shall only be required to maintain in force\nthe site-specific policies described in Appendix 7.1.1 through the Final\nCompletion of each DC Project. All coverages shall be maintained by insurance\ncarriers acceptable to Webvan and Webvan's lenders and landlords in all\nrespects. The insurance referenced in clause (iii) of Section 7.1.1 shall\ncontain no exclusion which denies coverage for third party bodily injury or\nproperty damage arising out of errors or omissions in maps, plans, drawings,\ndesigns, or inspection or construction management services.\n\n 7.1.4 Certificates of insurance acceptable to Webvan shall be filed with\nWebvan prior to commencement of the Services for each DC Project. These\ncertificates and the insurance policies required by Section 7.1 shall contain a\nprovision that coverages afforded under the policies will not be modified,\ncanceled or allowed to expire until at least thirty (30) days' prior written\nnotice has been given to Webvan. If any of the foregoing insurance coverages are\nrequired to remain in force after the completion of all Services, an additional\ncertificate evidencing continuation of such coverage shall be submitted upon\ncompletion and final payment for all Services as required by this Contract.\n\n 7.1.5 Webvan and Bechtel each acknowledge that Webvan's insurance\ncarrier may require that those provisions of the Contract Documents setting\nforth the respective insurance coverages required of Webvan and Bechtel,\nrespectively, be varied. In such event, Bechtel and each Subcontractor and\nSubconsultant shall, upon the request of Webvan, obtain any other or additional\ninsurance coverage so required, provided Webvan bears any additional costs\noccasioned thereby. All policies of insurance shall name Webvan, its employees,\nofficers, directors, shareholders, and agents, and, at Webvan's option, any\nlandlord or lender for the applicable DC Property and any other person(s) Webvan\ndeems to have an insurable interest in the DC Property and\/or the DC Project\nwork, as additional insured(s) under the policy. Upon request by Webvan, Bechtel\nshall furnish each of its Subcontractor's and Subconsultant's policies (or\ncertificates thereof) to Webvan before commencement of the Services, evidencing\nall coverage required hereunder. In addition, Bechtel shall promptly furnish to\nWebvan copies of all \n\n\n\n 35\n 37\n\nendorsements both with respect to its own insurance and that of its\nSubcontractors and Subconsultants which are subsequently issued and which amend\ncoverage, but delivery of such endorsements will not release such parties from\ntheir obligation to obtain the insurance required by this Contract. The\nrequirements for the foregoing insurance shall not diminish or limit Bechtel's\nobligations to indemnify Webvan under this Contract.\n\n 7.1.6 Notwithstanding any provision in any of the Contract Documents to\nthe contrary, Bechtel shall obtain products and completed operations coverage\nrequired under this Contract, which coverage shall be maintained in force for\nfour (4) years after Substantial Completion of each DC Project for claims for\ndamages to tangible property resulting from defects (latent or otherwise) in\nconstruction of improvements to real property or in the assembly and\ninstallation of the Operating Equipment.\n\n 7.1.7 If Bechtel fails to secure and maintain the required insurance,\nWebvan shall have the right (without the obligation to do so) to secure same in\nthe name and for the account of Bechtel, in which event Bechtel shall pay the\ncost thereof and shall furnish upon demand all information that may be required\nin connection therewith.\n\n7.2 Property Insurance.\n\n 7.2.1 With respect to each DC Project and unless otherwise provided in\nany provision of the Contract Documents, Bechtel shall purchase and maintain\n\"builder's risk\" property insurance in the amount of the Budgeted Cost plus the\nBechtel Fee (as they may be modified pursuant to this Contract) and the\napplicable DC Property, as appropriate, on a replacement cost basis and with\nsuch deductible amounts as Webvan may approve. Bechtel's insurance (i) shall be\nplaced in the name of Bechtel and its Subcontractors and, at Webvan's option,\nshall name Webvan and any other person(s) whom Webvan deems to have an insurable\ninterest in the applicable DC Property and\/or the DC Project work, or any part\nthereof, as named insureds, and (ii) shall be payable to Bechtel for the\ninsureds as the respective interests of such named insureds may appear. Such\ninsurance shall not insure against loss, damage, or destruction of any\ncontractor equipment, materials and supplies or temporary buildings or other\nsuch property located in, on or about the DC Property, which are the property of\nBechtel, or any Subcontractor or Subconsultant, or any person directly or\nindirectly employed by or under contract with Bechtel or its Subcontractors or\nSubconsultants, all of which shall be insured by Bechtel under a separate\npolicy. The policy shall be retained and held by Bechtel. A copy of each policy\nrequired of Bechtel by the Contract Documents shall be delivered to Webvan upon\ndemand. Bechtel shall be responsible for the payment of all costs not covered\nbecause of deductibles in excess of $10,000 per occurrence under Bechtel's\nproperty insurance.\n\n 7.2.2 Intentionally omitted.\n\n 7.2.3 Property insurance shall be on a \"Special Form\" policy form, and\nshall insure against the perils of fire and extended coverage and physical loss\nor damage, including theft, vandalism, malicious mischief, collapse, false-work,\ntemporary buildings and debris removal, including demolition occasioned by\nenforcement of any applicable legal requirements. Coverage shall also be\nprovided, as needed, for earthquake and flood, for inland transit of permanent\nplant equipment and offsite storage exposures for materials to be incorporated\ninto a DC Project, and for physical damage to DC Project work resulting from\nfaulty workmanship, materials or design.\n\n 7.2.4 If requested by Webvan, Bechtel shall obtain and provide Webvan\nwith a certificate (or certificates) of any insurance carried by Bechtel\ncovering the DC Project work during the course of \n\n\n\n 36\n 38\n\nconstruction, to the extent any such insurance affects or covers any interest of\nWebvan in the DC Project work.\n\n 7.2.5 Webvan and Bechtel, by their execution of this Contract, each\nhereby waives all rights against each other and any of their Subconsultants,\nSubcontractors, agents and employees, each of the other, for damages to property\ncaused by fire or other perils to the extent such damages are covered by\nproperty insurance obtained pursuant to this Section 7.2 or any other provision\nof the Contract Documents, or any other property insurance maintained by Webvan\nor Bechtel applicable to the DC Project work or the applicable DC Property,\nregardless of the negligence of the entity so released; provided, however, that\nsuch waivers are effective only if the applicable insurance policies of both\nparties contain a clause to the effect that such release shall not affect the\nright of the insured to recover under such policy. Each party shall cause each\nproperty insurance policy obtained by it to provide that the insurer waives all\nright of recovery by way of subrogation against the other party in connection\nwith any injury or damage covered by such policy. Bechtel shall also require of\nall Subcontractors and Subconsultants similar waivers in favor of Webvan and\nBechtel. In addition, as to any DC Property for which Webvan's landlord is\nrequired to maintain property insurance under Webvan's lease, Webvan shall\nrequest such landlord to obtain from its property insurer a waiver of\nsubrogation for the benefit of Bechtel. Bechtel shall similarly obtain from\nBechtel's property insurer of any DC Project work a waiver of subrogation for\nthe benefit of Webvan's landlord at the applicable DC Property, if such\nlandlord's insurer provides Bechtel with a waiver of subrogation.\n\n 7.2.6 A loss covered under Bechtel's property insurance shall be\nadjusted reasonably by Bechtel and shall be made payable to Bechtel for the\ninsureds, as their interests may appear. Bechtel shall pay Subcontractors their\njust portion of any insurance proceeds received by Bechtel and, by appropriate\nwritten agreements, shall require Subcontractors to make payments to their\nsub-subcontractors in a similar manner. Bechtel shall deposit in a separate\naccount any insurance proceeds actually received by Bechtel under any of the\napplicable policies. Bechtel shall apply such proceeds only toward the repair,\nrestoration and performance of DC Project work and shall distribute such\nproceeds in accordance with such agreement as the parties in interest may reach.\nIf, after such loss, no other special agreement is made, replacement of damaged\nproperty shall be covered by appropriate Change Order. Notwithstanding the\nforegoing provisions of this Section 7.2.6, if following any such loss Webvan\nelects to terminate this Contract with respect to the DC Project affected by\nsuch loss, then all proceeds of Bechtel's property insurance for such DC Project\nshall be paid to Webvan.\n\n7.3 Risk of Loss. From the date that a Notice to Proceed for a DC Project is\nfirst executed by Webvan through and including the date of Substantial\nCompletion of such DC Project, Bechtel shall bear all risk of loss, casualty,\ndamage, destruction, theft, vandalism and malicious mischief (collectively,\n\"RISK OF LOSS\") to and for such DC Project work and the applicable DC Property.\nAfter the date of Substantial Completion of a DC Project, Webvan shall bear all\nRisk of Loss to such DC Project and the applicable DC Property. Bechtel and\nWebvan acknowledge, however, that the foregoing allocation of Risk of Loss is\nmade solely for the purpose of allocating responsibilities between Bechtel and\nWebvan for the repair, replacement and restoration of DC Project work and the\napplicable DC Properties following any loss, casualty, damage, destruction,\ntheft, vandalism or malicious mischief of or to such DC Project work and\/or the\napplicable DC Properties. Nothing contained in this Section 7.3, therefore,\nshall release Bechtel or any of its Subcontractors or Subconsultants from, or\nwaive or modify the liability and responsibility of Bechtel and its\nSubcontractors and Subconsultants for, any of their respective obligations\notherwise provided under this Contract or the applicable Contract Documents,\nincluding, without limitation, Section 2.3.4.7, Section 2.5.10, Section 2.6, and\nSection 8.16.\n\n\n\n 37\n 39\n\n8.0 MISCELLANEOUS PROVISIONS\n\n8.1 Year 2000 Compliance Warranty. Bechtel warrants that any computer\nproduct, application or system developed by Bechtel hereunder (\"PRODUCT\"), if\nany, will be Year 2000 Compliant in all material respects at the time of\nturnover of a DC Project. As used in this warranty, the term \"YEAR 2000\nCOMPLIANT\" means that the Product, when configured and used according to the\ndocumented instructions on the Project, will, without manual intervention or\ninterruption, either meet the Year 2000 compliance standard set by a recognized\nindustry association or code (such as the American Society for Testing and\nMaterials, the American Standard Code for Information Interchange, or the\nInstitute of Electrical and Electronics Engineers, Inc.) or will: (i) correctly\nhandle and process date information before, during and after January 1, 2000,\naccepting date input, providing date output and performing calculations,\nincluding but not limited to sorting and sequencing, on dates or portions of\ndates; (ii) function according to the documentation before, during and after\nJanuary 1, 2000 without changes in operation resulting from the advent of the\nnew century; (iii) when appropriate, respond to two-digit date input in a way\nthat resolves any ambiguity as to century in a disclosed, defined and\npredetermined manner; (iv) store and provide output of date information in ways\nthat are unambiguous as to century; and (v) manage the leap year occurring in\nthe year 2000, following the quad-centennial rule. The \"quad-centennial rule\"\nmeans (a) if the year is divisible by 4, it is a leap year, unless (b) the year\nis also divisible by 100, then it is not a leap year, unless (c) the year is\nalso divisible by 400, then it is a leap year. Bechtel will require all\nSubcontractors to warrant Year 2000 Compliance in respect of services and\nproducts they supply to the Project.\n\n8.2 Ownership of Data.\n\n 8.2.1 Data Defined. For the purposes of this Section 8.2, \" DATA\" means\nall designs, plans, models, drawings, prints, samples, transparencies,\nspecifications, reports, manuscripts, working notes, documentation, manuals,\nphotographs, negatives, tapes, discs, databases, software, works of art,\ninventions, discoveries, components and any Contract Documents or similar items.\n\n 8.2.2 Ownership and Use of Background Data.\n\n 8.2.2.1 All intellectual property rights, copyrights, design\nrights, patents, and other similar invention rights, trademarks, trade names,\nservice marks, trade secrets, all applications for and rights in or to any of\nthe foregoing (collectively \"IP RIGHTS\") in or to all Data now or hereafter\nowned or prepared by Webvan (\"WEBVAN DATA\") shall be owned solely by Webvan.\nWithout limiting the generality of the foregoing sentence, Webvan Data shall\ninclude, without limitation, [*]. Bechtel shall have no ownership or other\nrights or interest in any Webvan Data or any of Webvan's IP Rights. Any Webvan\nData and Webvan IP Rights disclosed to Bechtel shall be used by Bechtel solely\nin the performance of Services on behalf of Webvan hereunder and shall be\nsubject to the obligation to keep same strictly confidential as provided in\nSection 8.10.\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n\n 38\n 40\n\n 8.2.2.2 All IP Rights in or to all construction and program\nmanagement systems and designs, construction estimating, measurement and\nprocurement control systems, plot plan processor software, and construction and\nprogram management information technology systems and software which Bechtel\nowns or has prepared prior to the date hereof (collectively, \"BECHTEL BACKGROUND\nDATA\") shall remain the property of Bechtel. Bechtel Background Data shall not,\nhowever, include any Webvan Data or Developed Data. Bechtel hereby grants to\nWebvan a perpetual, non-exclusive, irrevocable, royalty-free license to use,\ncopy and modify the Bechtel Background Data to the extent necessary to operate,\nuse or maintain any DC Project work, but solely in connection with DC Projects\nfor which Bechtel has provided Services under this Contract. Except as provided\nherein, Webvan shall have no ownership or other rights or interest in any\nBechtel Background Data.\n\n 8.2.3 Developed Data. All IP Rights in all Data prepared or developed by\nor for Bechtel or any of its Subcontractors or Subconsultants hereunder,\nincluding, without limitation, all Contract Documents (collectively, \"DEVELOPED\nDATA\") shall vest in and become the sole property of Webvan, shall be treated by\nBechtel (and Bechtel shall require that all of its Subcontractors and\nSubconsultants treat it) as strictly confidential, and shall at all times remain\nthe property of Webvan, and all works of art which constitute copyrightable\nsubject matter shall be considered \"works made for hire\" to the fullest extent\nallowable under the United States Copyright Act. All such Developed Data shall\nautomatically and immediately constitute Webvan Data and shall be clearly\nmarked, where possible, as Webvan's property, and Bechtel agrees to assign and\ndoes hereby assign all right, title and interest in, under and to the Developed\nData to Webvan. Each party agrees to perform any further acts and execute and\ndeliver any and all further documents and\/or instruments which are considered\nnecessary or appropriate by Webvan to ensure that the Developed Data vests in\nWebvan, including but not limited to executing assignments, oaths and\ndeclarations for IP Rights on a country by country basis as deemed advisable by\nWebvan and any other action for perfecting in Webvan all right, title and\ninterest in, under and to the Developed Data. At Webvan's request from time to\ntime, Bechtel shall furnish a copy of all such Developed Data to Webvan and\ncopies of designs, drawings, plans, specifications, databases and reports (in\nelectronic format, to the extent available). Bechtel shall maintain in good\norder at each DC Project site one record copy of the drawings, Change Orders and\nother modifications, specifications, product data, samples, and shop drawings\nmarked currently to record changes made during Development. Each of the items\nspecified in the foregoing sentence shall be delivered to Webvan upon completion\nof the Development of the DC Project and prior to Final Payment. Bechtel shall,\nhowever, have the right to retain one copy of each such item for Bechtel's\narchive records, subject to the provisions of this Section 8.2, Section 8.10 and\nany confidentiality covenant executed pursuant to Section 8.10.\n\n 8.2.4 Equitable Relief. Bechtel acknowledges that the damages that\nWebvan will incur as a consequence of any breach by Bechtel or any Subcontractor\nor Subconsultant of the provisions of this Section 8.2, of Section 8.10 or of\nany confidentiality covenant executed pursuant to Section 8.10 of this Agreement\nwill be irreparable and may not readily be capable of calculation. Accordingly,\nto the fullest extent permissible by Law and without limiting any other rights\nor remedies that may be available to Webvan pursuant to this Contract, Webvan\nshall be entitled, as a matter of right, to specific performance and other\ninjunctive relief to protect Webvan's interests, including but not limited to\npreliminary and permanent injunctive relief. Bechtel hereby consents to the\nissuance by any court of competent jurisdiction of both temporary and permanent\ninjunctions restraining and prohibiting Bechtel and its agents and\nrepresentatives, from violating any of the provisions of this Section 8.2, of\nSection 8.10 or of any other confidentiality covenant executed pursuant to\nSection 8.10. Bechtel shall cause each of its Subcontractors and Subconsultants\nto consent to the foregoing injunctive relief and shall provide Webvan with\ncopies of such consents upon Webvan's request.\n\n\n\n 39\n 41\n\n8.3 Public Releases. Bechtel shall not make public announcements or publicity\nreleases related to the Project without Webvan's prior written approval,\nincluding, without limitation, Webvan's prior written approval of the form and\ncontent of any such announcements or releases, in both cases such approval not\nto be unreasonably withheld.\n\n8.4 Time of Performance. If the date for any payment under this Contract\nfalls on a Saturday, Sunday or legal holiday, payment shall be made as specified\non the next following business day.\n\n8.5 Independent Contractor. Bechtel is and at all times shall be an\nindependent contractor with respect to the Services and the Project. Neither\nthis Contract nor any of the Contract Documents nor any course of dealing or\npractice shall be interpreted as creating, or shall be deemed to create, any\nemployer-employee, principal-agent, partnership, joint venture or other\nrelationship between Webvan and Bechtel. Bechtel has and hereby retains the\nright to exercise full control over the employment, direction and discharge of\nall persons assisting it in the execution of the Services. Bechtel shall be\nsolely responsible for all matters relating to payment of its employees,\nincluding compliance with Social Security, withholding and all other regulations\ngoverning such matters. Bechtel shall be solely and fully responsible for its\nown acts and those of its subordinates, employees, Subconsultants and\nSubcontractors during the term of this Contract.\n\n8.6 Prior Work. Any Services, including all engineering and design work\nperformed by Bechtel or its Subconsultants and Subcontractors for the Project\nprior to the Effective Date shall be and hereby are incorporated into this\nContract and covered by the conditions and requirements set forth herein.\n\n8.7 Notices. All notices required or permitted to be given hereunder shall be\nin writing, and shall be deemed duly delivered, received and given, (i) upon\npersonal delivery to the address set forth below, or to such other address\ndesignated by five (5) days' prior written notice to the other party, (ii) one\n(1) business day following delivery to an overnight courier guaranteeing next\nbusiness day delivery to the address set forth below, or to such other address\ndesignated by five (5) days' prior written notice to the other party, or (iii)\nimmediately upon the next business day after confirmation of facsimile receipt\nat the fax number set forth below or to such other fax number designated by five\n(5) days' written notice to the other party. The address of the parties for the\npurpose hereof shall respectively be:\n\n For Webvan: Webvan Group, Inc.\n 1241 E. Hillsdale Boulevard, Suite 210\n Foster City, California 94404\n Attention: Gary B. Dahl\n Facsimile: 650-524-4801\n\n For Bechtel: Bechtel Corporation\n 50 Beale Street\n San Francisco, California 94119-3965\n Attention: Thomas R. McKinney\n Facsimile: 415-768-5253\n\n\n8.8 Successors and Assigns. This Contract calls for the personal services of\nBechtel and, therefore, Bechtel has no right to assign, delegate or transfer,\nand shall not assign, delegate or transfer, any right or obligation under this\nContract (including Bechtel's right to payments). Webvan may assign this\nContract to any person or entity controlled by, under common control with, or\nwhich controls Webvan or to any \n\n\n\n 40\n 42\n\nlender on all or any portion of the Project, or to any entity or entities which\nsucceed to Webvan's interest in any of the Project, without Bechtel's consent,\nor to any other persons or entities with Bechtel's consent, which consent shall\nnot be unreasonably withheld. Webvan shall promptly notify Bechtel of any such\nassignment or transfer. Subject to the foregoing, this Contract shall extend to,\nbe binding upon and inure to the benefit of, the respective heirs, executors,\nadministrators, successors and assigns of Webvan and Bechtel.\n\n8.9 Occupancy and Use of DC Project Work Prior to Completion. Webvan shall\nhave the right to occupy any DC Property or use any portion of the DC Project\nwork prior to Substantial Completion thereof. Unless otherwise agreed upon,\npartial occupancy or use of a portion or portions of the DC Project work shall\nnot constitute acceptance of work not complying with the requirements of the\nContract Documents.\n\n8.10 Confidentiality. Bechtel shall keep, and shall require all Subcontractors\nand Subconsultants to keep, confidential all \"Confidential Information\" as\ndefined in and subject to the terms of the Confidentiality and Nondisclosure\nAgreement attached hereto as Appendix 8.10 and made a part hereof.\n\n8.11 Entire Agreement; Amendments; Survival of Provisions. This Contract\nconstitutes the entire agreement between the parties hereto relating to the\nsubject matter hereof and supersedes any previous agreements or understandings.\nThis Contract may be amended only by a written instrument signed by both Webvan\nand Bechtel. All provisions of this Contract shall survive the termination or\nexpiration of this Contract.\n\n8.12 Effective Date. The \"EFFECTIVE DATE\" of this Contract shall be the date\nby which this Contract has been executed by the parties, as indicated opposite\neach party's respective signature at the end of this Contract, provided that the\nexecuted Contract has been mutually delivered. If the parties do not execute\nthis Contract on the same date, the Effective Date shall be the date on which\nthe second party delivers the fully executed Contract to the other party.\n\n8.13 No Waiver. No term or condition of this Contract may be waived except by\nan instrument duly executed by the waiving party. No delay or failure by any\nparty in exercising any of its rights, remedies, powers or privileges under this\nContract and no custom, practice or course of dealing between or among any of\nsuch parties or any other person shall be deemed a waiver by such party of any\nsuch rights, remedies, powers or privileges, even if such delay or failure is\ncontinuous or repeated. No single or partial exercise of any right, remedy,\npower or privilege shall preclude any other or further exercise thereof by any\nsuch party or the exercise of any other right, remedy, power or privilege by\nsuch party, including, without limitation, the right of such party subsequently\nto demand strict compliance with the terms and conditions of this Contract.\n\n8.14 Bechtel's Representations and Warranties. Bechtel hereby represents and\nwarrants to Webvan that it is legally empowered to provide all of the Services\nrequired by this Contract in the states in which the DC Projects are and will be\nlocated and the states in which all Services will be performed. At all times\nduring the term of this Contract, Bechtel shall, at its sole cost and expense,\nkeep in full force and effect all professional and business permits, licenses\nand approvals affecting Bechtel's ability to perform the Services and otherwise\nnecessary and appropriate to enable Bechtel to perform this Contract, including,\nwithout limitation, all professional licenses and qualifications of any\nindividual employees of Bechtel providing services under this Contract or any\nother Contract Documents. The person executing this Contract on behalf of\nBechtel represents that this Contract is binding and enforceable against Bechtel\nin accordance with its terms, and that no other signature of any party is\nnecessary to make this Contract \n\n\n\n 41\n 43\n\nbinding on and enforceable against Bechtel. Bechtel has made these\nrepresentations and warranties to Webvan knowing that Webvan is relying to a\nmaterial extent on said representations and warranties in entering into this\nContract.\n\n8.15 Exposure to Hazardous Materials. Webvan shall have no liability to\nBechtel, its Subcontractors or Subconsultants or any of their respective\nemployees or agents with respect to any exposure to asbestos, PCB's or hazardous\nmaterials on any DC Property or elsewhere. Bechtel shall cause its\nSubcontractors and Subconsultants, and the respective employees and agents of\nBechtel and all Subcontractors and Subconsultants, to take all reasonable\nprecautions necessary to prevent their exposure to any asbestos, PCB's and other\nhazardous materials disclosed by Webvan or otherwise known by Bechtel as being\npresent at a DC Property. In addition, Webvan and Bechtel shall each have the\nrights and obligations set forth in Section 8.1 of the General Conditions.\n\n8.16 Indemnification. To the fullest extent permitted by Law, Bechtel shall\nindemnify, defend (with counsel reasonably acceptable to Webvan) upon demand,\nprotect and hold harmless Webvan, its subsidiaries and affiliates and their\nrespective officers, directors, shareholders, agents, consultants and employees\nfrom and against any and all causes of action, demands, losses, violations,\ninfringements of Law, patent, license or trademark, costs, attorneys' and\nexperts' fees, claims, damages, and liabilities of every kind and nature arising\nout of, alleged to have arisen out of, or resulting in any way from, the\nServices to be performed under this Contract by Bechtel and its Subcontractors\nand Subconsultants which are the result of any willful misconduct, negligent act\nor omission, or breach of any obligation or representation under this Contract\nor any of the other Contract Documents, by Bechtel or any of its Subcontractors\nor Subconsultants or material suppliers, or by the respective agents, officers,\nemployees, representatives, contractors or subconsultants of any of them. The\nforegoing notwithstanding: (i) Bechtel's obligations to indemnify and hold\nWebvan and its employees harmless shall in no event apply to the portion of any\nclaim which is due to the negligence or willful misconduct of Webvan, its\nsubsidiaries or affiliates or their respective officers, directors,\nshareholders, agents or employees; (ii) Bechtel shall have no obligation to\nprotect, indemnify, defend or hold harmless any consultant of Webvan if any\nclaim is due in part to the negligence or willful misconduct of such consultant;\nand (iii) Bechtel's foregoing indemnity obligation shall not apply with respect\nto infringements of patents by any Subcontractor that Webvan has specified as\nthe only subcontractor that Bechtel is authorized to engage to perform\nparticular Services. Acceptance of any Services by Webvan shall not operate as a\nwaiver of the foregoing indemnification, and the foregoing indemnification shall\nsurvive the completion of the Project and the termination of this Contract. All\nof the foregoing indemnification shall (a) be in full force and effect and apply\nat all times during the progress of the Services and notwithstanding the\nSubstantial Completion of any DC Project, and the filing of a notice of\ncompletion or notice of similar import, or the termination of this Contract, and\nat all times thereafter, (b) not be deemed limited in any way by the amount or\ntype of any insurance coverage that the Bechtel is required to maintain\nhereunder, (c) not be limited by any limitation on amount or type of damages,\ncompensation or benefits payable by or for Bechtel or a Subcontractor or\nSubconsultant under workers' or workmen's compensation acts, disability benefit\nacts or other employee benefit acts, and (d) shall be subject to the express\nlimitations of liability and releases from liability set forth elsewhere in this\nContract. [*]\n\n8.17 Limitation of Rights and Remedies.\n\n 8.17.1 Notwithstanding Section 6.4 and Section 8.16, (a) the aggregate\nmonetary liability of Bechtel arising from Bechtel's performance or\nnon-performance of Services under this Contract shall not \n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n\n 42\n 44\nexceed the sum of [*] and (b) neither Bechtel nor any of its Subconsultants or\nSubcontractors shall be liable to Webvan, and Webvan hereby releases Bechtel and\nits Subconsultants and Subcontractors from any liability, for [*].\n\n 8.17.2 The limitations of liability and releases from liability under\nSection 8.17.1 shall not apply to any losses, costs, claims, liabilities or\ndamages incurred by Webvan or any of its subsidiaries or affiliates or any of\ntheir respective officers, directors, agents, shareholders or representatives\narising from or relating in any manner to (i) any intentional violation of\nSection 8.2 (entitled \"Ownership of Data\"), Section 8.10 (entitled\n\"Confidentiality\" or any confidentiality agreement executed thereunder), or\nSection 8.25 (entitled \"Bechtel Exclusivity\") by any corporate officer of\nBechtel or any of its subsidiaries or affiliates, or by Bechtel's Program\nDirector for the Project or any of his direct reports, or (ii) any claims\nbrought by third parties.\n\n 8.17.3 The foregoing limitations of liability and releases from liability\nare personal to Bechtel and its Subcontractors and Subconsultants and any of its\nor their subsidiaries or affiliates and their respective officers, directors,\nshareholders and agents and shall not apply to any other person or entity. No\nacts, omissions, reviews, approvals or other actions hereunder by Bechtel shall\ngive rise to any claim by any other party against Webvan or limit the liability\nof any party to Webvan. Except as expressly provided to the contrary in this\nContract, no provision of this Contract is intended to, and no provision of this\nContract shall, limit the rights or remedies of Webvan pursuant to any other\nprovisions of this Contract. To the maximum extent permitted by law, however,\nbut no further, the limitations on damages, the releases from liability, the\nlimitations of liability, and the exclusive remedies provisions expressly\nprovided in this Contract shall apply even in the event of the fault, negligence\n(in whole or in part), strict liability or breach of contract of the party who\nis released or whose liability is limited by such provisions of this Contract\nand shall extend to such party's officers, directors, employees and agents. The\nremedies provided in this Contract are exclusive, except that Webvan shall in\naddition have the right to obtain specific performance and all other injunctive\nrelief that may be available. Bechtel disclaims, and Webvan waives, any implied\nwarranties of merchantability or fitness for a particular purpose with respect\nto any equipment or other personal property procured by Bechtel and provided to\nWebvan as part of any DC Project.\n\n8.18 Governing Law. The validity, effect, construction, performance and\nenforcement of this Contract and the rights and obligations of the parties\nhereunder shall be governed in all respects by the laws of the State of\nCalifornia without reference to conflicts of law, except that the enforcement of\nremedies against any DC Property shall be governed by the law of the state where\nthe DC Property is located. Venue for the resolution of any disputes between\nBechtel and Webvan regarding the Project shall be within the courts of the State\nof California.\n\n8.19 Counterparts. This Contract may be executed in one or more counterparts.\nAll counterparts so executed shall constitute one agreement, binding on all\nparties, even though all parties are not signatory to the same counterpart.\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 43\n 45\n\n8.20 Construction. Each party has reviewed and revised this Contract. The\nnormal rule of construction to the effect that any ambiguities are to be\nresolved against the drafting party shall not apply to the interpretation of\nthis Contract.\n\n8.21 Severability. If all of any portion of any provision of this Contract as\napplied to either party or to any circumstance shall be ruled by a court of\ncompetent jurisdiction to be void or unenforceable for any reason, the same\nshall in no way affect (to the maximum extent permissible by Law) that provision\nor the remaining portions of that provision as applied to any parties or\ncircumstances or any other provision of this Contract or the validity or\nenforceability of this Contract as a whole, all of which shall be enforced to\nthe greatest extent permitted by Law.\n\n8.22 Headings. The headings used herein are for purposes of convenience only\nand shall not be used in construing the provisions hereof.\n\n8.23 Cooperation with Lender and Landlords. Bechtel shall at all times\ncooperate with any lender and\/or landlord on the Project, any DC Property, any\nDC Project, or any portion thereof, including, without limitation, executing any\nagreements, documents, acknowledgments, certificates and\/or amendments to this\nContract as Webvan and\/or such lender or landlord may reasonably require in\nconnection with any sale or financing, whether construction or permanent, for\nthe Project, any DC Property, or any portion thereof, as further provided in the\nGeneral Conditions. In no event, however, shall Bechtel be required to execute\nany such document or amendment which would adversely affect Bechtel's\nlimitations of liability or other rights under this Contract, unless agreed to\nby Bechtel in its sole discretion.\n\n8.24 Attorneys' Fees and Costs. In any action arising under or in connection\nwith this Contract, the prevailing party in such action shall be awarded, in\naddition to other legal or equitable relief, its reasonable costs and expenses\nand reasonable attorneys' fees.\n\n8.25 Bechtel Exclusivity.\n\n 8.25.1 Notwithstanding any term or condition of this Contract or any\nContract Documents to the contrary, neither Bechtel nor any entity controlling,\ncontrolled by, or under common control with Bechtel shall, for the Exclusive\nPeriod, provide any goods or services substantially similar to the Services\ndescribed in this Contract for distribution or delivery facilities of any person\nor entity in the business (a \"RELEVANT BUSINESS\") of [*]. For purposes of this\nSection 8.25, the \"EXCLUSIVE PERIOD\" shall commence [*]\n\n\n*Certain information on this page has been omitted and filed \n separately with the Commission. Confidential treatment has \n been requested with respect to the omitted portions.\n\n\n 44\n 46\n[*].\n\n 8.25.2 Webvan acknowledges Webvan's intent to engage Bechtel in the\nfuture to provide Services similar to those described in this Contract for\nWebvan DC's outside the United States of America (\"USA\"). Bechtel acknowledges,\nhowever, that this Contract creates no obligation of Webvan to engage Bechtel\nfor such services outside the USA. If, therefore, [*].\n\n 8.25.3 Bechtel acknowledges that the damages that Webvan will incur as a\nconsequence of any breach by Bechtel of the provisions of this Section 8.25 will\nbe irreparable and may not readily be capable of calculation. Accordingly, to\nthe fullest extent permissible by Law and without limiting any other rights or\nremedies that may be available to Webvan pursuant to this Contract, Bechtel\nhereby consents to the issuance by any court of competent jurisdiction following\nany breach of this Section 8.25 by Bechtel of both temporary and permanent\ninjunctions restraining and prohibiting Bechtel and its agents and\nrepresentatives from violating any of the provisions of this Section 8.25.\n\n8.26 Days. Whenever used in this Contract, the word \"days\" shall refer to\ncalendar days except where otherwise expressly provided to the contrary.\n\n9.0 APPENDICES\n\n9.1 The following Appendices are incorporated into this Contract by this\nreference:\n\n<\/pre>\n
\n Appendix 2.0 Notice to Proceed<\/p>\n
Appendix 2.5A Request to Solicit Bids<\/p>\n
Appendix 2.5 General Conditions<\/p>\n
Appendix 2.5.3 General Work Requirements<\/p>\n
Appendix 5.1.2 Unit Rate Schedule<\/p>\n
Appendix 5.8 Warrant<\/p>\n
Appendix 7.1.1 Insurance Requirements<\/p>\n
Appendix 8.10 Confidentiality and Nondisclosure Agreement
\n<\/table>\n
*Certain information on this page has been omitted and filed
\n separately with the Commission. Confidential treatment has
\n been requested with respect to the omitted portions.<\/p>\n
45
\n 47<\/p>\n
In the event of any conflict or inconsistency between the terms
\nand conditions of this Contract form and the terms and conditions of any of the
\nappendices attached hereto, the terms and conditions of this Contract form shall
\ngovern and control.<\/p>\n
IN WITNESS WHEREOF, the parties hereto have executed this Contract to be
\neffective on the Effective Date provided in Section 8.12.<\/p>\n
WEBVAN GROUP, INC.<\/p>\n
By:\/S\/ LOUIS H. BORDERS
\n —————————————
\n Print
\n Name:\/S\/ LOUIS BORDERS
\n ————————————-
\n Title: CHAIRMAN & CEO
\n ————————————
\n Date: 7\/8\/99
\n ————————————-<\/p>\n
BECHTEL CORPORATION<\/p>\n
By: \/S\/ D. DONLY
\n —————————————
\n Print
\n Name: D. DONLY
\n ————————————-
\n Title: PRES – N.A. REGION
\n ————————————
\n Date: 8 JULY 99
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