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After recording, return to:

Calderwood & Harkness LLP 999 Second Avenue, Suite 4200 Seattle, WA 98104

Attention: Grace Nakamura

Space above reserved for Whatcom County Auditor recording stamp, document number, and recording date.

PERMANENT PIPELINE CORRIDOR EASEMENT AGREEMENT

Force-Main Pipeline Easement — Parcel No. 380220-108401

Part of the Lower Nooksack Pump Station Network CSIA Capital Project No. CP-2025-NPS-004

This PERMANENT PIPELINE CORRIDOR EASEMENT AGREEMENT (this "Agreement") is entered into as of _____, 2025 (the "Effective Date"), by and between:

GRANTOR: Dunlap Creek Ranch Inc., a Washington corporation (S-corporation), with its registered agent address at 18500 Guide Meridian Road, Lynden, WA 98264. The authorized signatory on behalf of Grantor is Garrett Dunlap, President and Sole Director of Dunlap Creek Ranch Inc. ("Grantor").

GRANTEE: Cascadia State Infrastructure Authority, a Washington State governmental instrumentality created and existing pursuant to Chapter 43.99N of the Revised Code of Washington, with its headquarters located at 1100 Jefferson Avenue SE, Suite 400, Olympia, WA 98501 ("Grantee" or "CSIA").

Grantor and Grantee are collectively referred to herein as the "Parties" and individually as a "Party."

RECITALS

A. Grantor's Ownership. Grantor is the owner in fee simple of approximately ninety-four (94) acres of dairy farmland located along Hannegan Road, Whatcom County, Washington, including the real property identified by the Whatcom County Assessor as Parcel No. 380220-108401 (the "Burdened Property"), which is more particularly described in the legal description attached hereto as Exhibit A and incorporated herein by this reference.

B. Grantee's Project. Grantee is developing the Regional Flood Resilience and Stormwater Management Program — Lower Nooksack Pump Station Network (the "Project"), designated as CSIA Capital Project No. CP-2025-NPS-004. The Project consists of the construction and operation of four pump stations (PS-1, PS-2, PS-3, and PS-4) and approximately 6.2 miles of 24-inch and 36-inch high-density polyethylene (HDPE) force-main pipeline connecting all four pump stations to the existing Nooksack Regional Wastewater Treatment Plant outfall. The total estimated capital cost of the Project is Forty-Eight Million Dollars ($48,000,000), funded through a combination of (i) a Washington State Capital Appropriation pursuant to Senate Bill 5140, 2025 Legislative Session, in the amount of Thirty-One Million Two Hundred Thousand Dollars ($31,200,000), and (ii) CSIA Series 2025A Revenue Bonds in the aggregate principal amount of Sixteen Million Eight Hundred Thousand Dollars ($16,800,000).

C. Pipeline Corridor Need. A segment of the force-main pipeline corridor traverses the Burdened Property. Grantee requires a permanent easement across the Burdened Property for the installation, operation, maintenance, repair, replacement, and removal of the force-main pipeline and associated appurtenances necessary for the Project.

D. Condemnation Authority. Grantee possesses the power of eminent domain pursuant to Chapter 43.99N RCW and applicable provisions of the Revised Code of Washington. Grantee has made a good-faith offer to Grantor in compliance with the requirements of RCW Chapter 8.25 (Uniform Condemnation Procedures Act), based upon an appraisal of the Burdened Property and the easement interest prepared by Northwind Valuation Group LLC (Jocelyn Trueblood, MAI, appraiser), dated March 14, 2025. The appraisal was performed in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP) and the methodology prescribed by the Uniform Appraisal Standards for Federal Land Acquisitions (commonly known as the "Yellow Book").

E. Voluntary Agreement. The Parties desire to establish the permanent easement rights described herein by voluntary agreement in lieu of condemnation proceedings, on the terms and conditions set forth below.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the Easement Compensation described in Article 5, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE 1 — DEFINITIONS

As used in this Agreement, the following terms shall have the meanings ascribed to them below. Capitalized terms used but not defined herein shall have the meanings given to them in the context in which they appear.

1.1 "Agreement" means this Permanent Pipeline Corridor Easement Agreement, including all Exhibits attached hereto, as the same may be amended, supplemented, or modified from time to time in accordance with the provisions hereof.

1.2 "Burdened Property" means the real property located in Whatcom County, Washington, identified by the Whatcom County Assessor as Parcel No. 380220-108401, and more particularly described in the legal description attached hereto as Exhibit A.

1.3 "Easement Area" means the linear corridor located on and across the Burdened Property as depicted on the Easement Plat attached hereto as Exhibit B and described by the metes-and-bounds legal description attached hereto as Exhibit C. The Easement Plat and metes-and-bounds legal description were prepared by Ironclad Surveying & Land Services LLC (Karen Whitfield, Professional Land Surveyor), with offices located at 4850 Cordata Parkway, Suite 110, Bellingham, WA 98226.

1.4 "Force-Main Pipeline" means the 24-inch and 36-inch HDPE (high-density polyethylene) force-main pipeline to be installed within the Easement Area, together with all associated appurtenances, including but not limited to valves, fittings, cleanouts, air-release valves, manholes, marker posts, cathodic protection systems, and all other infrastructure and equipment necessary for, or incidental to, the operation of the pipeline.

1.5 "Project" means the Regional Flood Resilience and Stormwater Management Program — Lower Nooksack Pump Station Network, designated as CSIA Capital Project No. CP-2025-NPS-004, as more fully described in Recital B above.

1.6 "Temporary Construction Period" means the period during which the initial construction and installation of the Force-Main Pipeline occurs within the Easement Area, commencing upon the recording of this Agreement with the Whatcom County Auditor and terminating upon the earlier of (a) Grantee's delivery to Grantor of written notice of construction completion, or (b) twenty-four (24) months from the date of recording of this Agreement.

1.7 "Permitted Activities" means the activities described in and authorized by Article 3 of this Agreement.

1.8 "Restoration Standards" means the standards for surface restoration described in Article 8 of this Agreement.

ARTICLE 2 — GRANT OF EASEMENT

2.1 Grant. For and in consideration of the Easement Compensation and the mutual covenants contained herein, Grantor hereby grants, conveys, and warrants to Grantee, its successors and assigns, a permanent, non-exclusive easement and right-of-way in, on, over, under, across, and through the Easement Area for the purpose of conducting the Permitted Activities (the "Easement"). The Easement is conveyed with all rights and privileges reasonably necessary to effectuate the purposes set forth in this Agreement.

2.2 Easement in Gross. The Easement is an easement in gross and is not appurtenant to any particular dominant estate. The Easement runs with the Burdened Property, is binding upon Grantor and all successors, heirs, personal representatives, and assigns of Grantor, and shall inure to the benefit of Grantee and its successors and assigns. The Easement shall be enforceable by Grantee or any permitted assignee of Grantee.

2.3 Duration. The Easement is perpetual in nature and shall continue in full force and effect in perpetuity unless and until Grantee abandons the Easement by the execution, delivery, and recording of a written instrument of abandonment with the Whatcom County Auditor. Mere non-use of the Easement by Grantee shall not, in and of itself, constitute abandonment.

2.4 Non-Exclusive Nature. The Easement granted herein is non-exclusive. Grantor retains all rights of use and enjoyment of the Burdened Property, including the Easement Area, to the extent that such use is not inconsistent with the Easement or the Permitted Activities and is subject to the limitations, restrictions, and reservations set forth in Article 6 of this Agreement. Nothing in this Agreement shall be construed to prohibit Grantor from granting additional easements or rights-of-way across the Burdened Property to third parties, provided that any such additional easement or right-of-way does not unreasonably interfere with the Easement or the Permitted Activities, and provided that Grantor shall notify Grantee in writing prior to granting any easement or right-of-way that would encumber any portion of the Easement Area.

ARTICLE 3 — PERMITTED ACTIVITIES AND EASEMENT PURPOSE

The Easement is granted for the following purposes, which shall collectively constitute the "Permitted Activities":

3.1 Installation. The right to survey, excavate, grade, trench, install, construct, lay, backfill, and compact the Force-Main Pipeline (including both 24-inch and 36-inch HDPE lines and all associated appurtenances) within the Easement Area in accordance with the Project plans, specifications, and applicable permits.

3.2 Operation. The right to operate, use, and control the Force-Main Pipeline for the conveyance of wastewater, stormwater, and other flows as part of the approximately 6.2-mile pipeline network connecting the four pump stations (PS-1, PS-2, PS-3, and PS-4) to the Nooksack Regional Wastewater Treatment Plant outfall. Operation includes all monitoring, testing, flow regulation, and system management activities necessary for the proper functioning of the Force-Main Pipeline and the Project.

3.3 Maintenance and Repair. The right to inspect, monitor, maintain, repair, rehabilitate, clean, flush, and perform pigging and internal inspection activities on the Force-Main Pipeline and all appurtenances, including the right to conduct routine, scheduled inspections and preventive maintenance as well as emergency repairs as circumstances may require. Maintenance and repair activities include, without limitation, excavation to expose the pipeline, repair or replacement of damaged sections, joint repair, valve and fitting replacement, and cathodic protection system maintenance.

3.4 Replacement and Upgrade. The right to remove and replace the Force-Main Pipeline, in whole or in part, with pipeline of comparable or improved specifications, including replacement with pipe of the same or different material (provided that the replacement material meets applicable engineering standards), provided that the replacement pipeline remains within the Easement Area as depicted on the Easement Plat and described in the metes-and-bounds description. This right includes the ability to upgrade the pipeline system to accommodate increased capacity or improved technology, subject to the Easement Area boundaries.

3.5 Appurtenances. The right to install, maintain, repair, replace, and operate all appurtenances and ancillary facilities necessary for, or incidental to, the operation and maintenance of the Force-Main Pipeline, including but not limited to valves, fittings, tees, reducers, cleanouts, air-release valves (both automatic and manual), vacuum relief valves, manholes, pipeline markers and warning signs, cathodic protection systems (including test stations, anodes, and rectifiers), and such other equipment as may be reasonably necessary.

3.6 Access. The right of ingress and egress, at all times and from time to time, across the Burdened Property to and from the Easement Area, using reasonable routes and existing farm roads where practicable, for the purpose of conducting any Permitted Activity. Access rights include the right to bring upon the Burdened Property all personnel, vehicles, heavy equipment, machinery, materials, and supplies reasonably necessary for the Permitted Activities. Grantee shall use commercially reasonable efforts to minimize interference with Grantor's agricultural operations when exercising access rights. The approved access routes are depicted on the map attached hereto as Exhibit D.

3.7 Vegetation Management. The right to clear, cut, trim, remove, and manage vegetation within the Easement Area to the extent reasonably necessary for pipeline construction, installation, operation, maintenance, inspection, repair, replacement, and access. Without limiting the generality of the foregoing, Grantee shall have the right to remove any deep-rooted trees or woody vegetation that may establish within the Easement Area, as such vegetation is prohibited within the Easement Area pursuant to Section 6.2(b) of this Agreement. Grantee shall dispose of cleared vegetation in a commercially reasonable manner and shall not leave slash or debris within the Easement Area or on the Burdened Property.

ARTICLE 4 — EASEMENT AREA DESCRIPTION AND SURVEY

4.1 Legal Description. The Easement Area is that certain linear corridor located within and upon Whatcom County Parcel No. 380220-108401, as more particularly described in the metes-and-bounds legal description prepared by Ironclad Surveying & Land Services LLC (Karen Whitfield, Professional Land Surveyor, Washington PLS No. ___), attached hereto as Exhibit C and incorporated herein by this reference. In the event of any conflict between the Easement Plat (Exhibit B) and the metes-and-bounds legal description (Exhibit C), the metes-and-bounds legal description shall control.

4.2 Easement Plat. The Easement Area is graphically depicted on the Easement Plat attached hereto as Exhibit B, which has been prepared by Ironclad Surveying & Land Services LLC and which shows the location, configuration, and dimensions of the Easement Area in relation to the boundaries of the Burdened Property, existing physical features, and adjacent parcels. The Easement Plat is incorporated herein by this reference.

4.3 Width. The Easement Area shall be __ (__) feet in width, centered on the pipeline centerline as shown on the Easement Plat (Exhibit B). In the event of curves, angle points, or deviations in alignment, the width of the Easement Area shall be measured perpendicular to the pipeline centerline at all points along the corridor.

4.4 Markers. Following completion of initial pipeline installation and restoration of the Easement Area surface, Grantee shall, at Grantee's sole cost and expense, install permanent survey markers or monuments at each angle point along the Easement Area boundaries and at intervals of no more than five hundred (500) feet along the Easement Area boundaries in tangent (straight) sections. All survey markers and monuments shall be of durable construction and shall comply with the standards established by the Washington State Department of Natural Resources for survey monuments. In addition, Grantee shall install pipeline markers (including above-ground warning posts) at intervals and locations consistent with applicable industry standards and regulatory requirements, including any requirements of the Washington Utilities and Transportation Commission. All markers shall be designed and installed in a manner that accommodates typical agricultural and livestock activities on the Burdened Property.

ARTICLE 5 — COMPENSATION

5.1 Easement Compensation. In consideration of the Easement granted herein and the rights, privileges, and obligations set forth in this Agreement, Grantee shall pay to Grantor the total sum of _____ Dollars ($___) (the "Easement Compensation"). The Easement Compensation has been determined on the basis of a linear-foot valuation of the Easement Area as set forth in the appraisal prepared by Northwind Valuation Group LLC (Jocelyn Trueblood, MAI), dated March 14, 2025, which appraisal was prepared in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP) and the Uniform Appraisal Standards for Federal Land Acquisitions ("Yellow Book") methodology. The Easement Compensation represents the full and fair market value of the easement interest conveyed herein, including any diminution in value to the remainder of the Burdened Property resulting from the Easement, as determined by the appraisal.

5.2 Payment. The Easement Compensation shall be paid in full by wire transfer of immediately available funds to an account designated by Grantor in writing, or by certified or cashier's check made payable to "Dunlap Creek Ranch Inc.," within ten (10) business days following the date on which this Agreement is recorded with the Whatcom County Auditor. Grantee shall provide Grantor with written confirmation of payment promptly following disbursement. Grantor's acceptance of the Easement Compensation shall constitute a full and final settlement of all claims for compensation related to the Easement granted herein, subject to the provisions of Sections 5.4, 8.3, and Article 10 of this Agreement.

5.3 Title Insurance. Grantee shall obtain, at Grantee's sole cost and expense, a title insurance policy from Cascade Basin Title Company (title officer: Diane Ashworth, 119 East Magnolia Street, Bellingham, WA 98225), insuring the Easement in such amount and with such endorsements as Grantee may, in its sole discretion, require. Grantor shall cooperate with Grantee and the title company in connection with the issuance of such title insurance policy, including providing access to the Burdened Property for inspection and survey purposes and executing such affidavits and other documents as may be reasonably requested by the title company to facilitate the issuance of the policy. Nothing in this Section shall require Grantor to incur any cost or expense in connection with the title insurance policy.

5.4 No Further Compensation. Except as expressly provided in Section 8.3 (Crop Damage Compensation) and Article 10 (Indemnification and Liability), no additional compensation, rent, royalty, or other payment of any kind shall be payable by Grantee to Grantor for the Easement, the Permitted Activities, or any other right granted to Grantee under this Agreement, whether during the Temporary Construction Period or at any time thereafter.

ARTICLE 6 — GRANTOR'S RETAINED RIGHTS AND RESTRICTIONS

6.1 Retained Agricultural Use. Grantor retains the full right to use, occupy, and enjoy the Easement Area and the remainder of the Burdened Property for dairy farming, agricultural cultivation, livestock grazing, hay production, forage production, and all other lawful agricultural purposes, provided that such use does not unreasonably interfere with, impede, or prevent the exercise of the Permitted Activities by Grantee, and further provided that such use does not damage, endanger, or impair the structural or operational integrity of the Force-Main Pipeline or any appurtenances installed within the Easement Area. Grantor may conduct normal agricultural operations over and across the Easement Area, including plowing, disking, seeding, fertilizing, irrigating, and harvesting, subject to the depth restrictions set forth in Section 6.2(c) below.

6.2 Restrictions on Grantor's Use Within the Easement Area. Grantor agrees that, within the Easement Area, Grantor shall not undertake or permit any of the following activities without the prior written consent of Grantee (which consent may be withheld, conditioned, or delayed in Grantee's reasonable discretion):

(a) Structures and Improvements. No permanent structures, buildings, barns, sheds, silos, foundations, paved surfaces, concrete slabs, retaining walls, or other improvements of a permanent nature shall be constructed, placed, or maintained within the Easement Area. Notwithstanding the foregoing, Grantor may install and maintain agricultural fencing across or within the Easement Area, provided that such fencing is of a type that is readily removable to accommodate Grantee's access to the Easement Area, and provided that Grantor installs gates or removable panels at locations agreed upon by the Parties to ensure Grantee's unimpeded access.

(b) Trees and Woody Vegetation. No deep-rooted trees, shrubs, or woody vegetation shall be planted, cultivated, or permitted to grow within the Easement Area. Grantor shall promptly remove, or permit Grantee to remove, any volunteer trees or woody vegetation that establish within the Easement Area. Shallow-rooted agricultural grasses, pasture grasses, and annual row crops are permitted.

(c) Excavation and Grading. No excavation, grading, filling, ditching, soil removal, or other disturbance of the soil surface within the Easement Area shall be conducted to a depth greater than eighteen (18) inches below the existing finished grade without Grantor first providing written notice to Grantee and obtaining Grantee's prior written approval. Normal agricultural tillage operations to a depth not exceeding eighteen (18) inches are permitted without notice or approval.

(d) Blasting and Drilling. No blasting, drilling, pile-driving, or other percussive or vibratory activities shall be conducted within the Easement Area or within twenty-five (25) feet of any boundary of the Easement Area without Grantee's prior written consent.

(e) Storage of Equipment and Materials. Grantor shall not park, store, or stage heavy equipment, vehicles, or materials within the Easement Area in a manner that would impede or prevent Grantee's access to the Easement Area or that would impose loads on the pipeline exceeding its designed load-bearing capacity. Incidental crossing of the Easement Area by agricultural equipment in the ordinary course of farming operations is permitted.

(f) Water Impoundment and Drainage. No impoundment, diversion, or ponding of water shall be constructed or maintained within the Easement Area, and no alteration of existing surface or subsurface drainage patterns within the Easement Area shall be made, if such impoundment, diversion, ponding, or alteration could adversely affect the structural integrity, bedding, backfill, or cathodic protection of the Force-Main Pipeline.

6.3 Livestock. Grantor may graze livestock (including dairy cattle, beef cattle, horses, and other livestock customarily associated with dairy farming operations) across and upon the Easement Area, provided that such grazing activity does not damage pipeline markers, air-release valves, manholes, cathodic protection test stations, or other above-ground appurtenances or access routes. Grantee shall design and install all above-ground pipeline markers and appurtenances to be of durable construction and capable of withstanding typical agricultural and livestock activities, including incidental contact by livestock. If livestock damage to markers or appurtenances occurs despite the use of durable construction, Grantee shall bear the cost of repair or replacement of such markers or appurtenances and Grantor shall not be liable for such damage, except to the extent caused by Grantor's willful or negligent failure to manage livestock in a commercially reasonable manner.

ARTICLE 7 — DEPTH OF COVER AND PIPELINE SPECIFICATIONS

7.1 Minimum Depth of Cover. The Force-Main Pipeline shall be installed with a minimum depth of cover of forty-two (42) inches, measured from the finished grade of the ground surface to the top (crown) of the pipe at all points along the pipeline alignment within the Easement Area. If applicable engineering standards, manufacturer specifications, or any federal, state, or local permit or regulatory requirement mandates a greater depth of cover, the greater depth shall govern. In areas where the pipeline crosses existing drainage ditches, waterways, or roadways, the depth of cover shall be increased as necessary to provide adequate protection against erosion, scour, and applied surface loads.

7.2 Pipeline Materials. The Force-Main Pipeline shall consist of 24-inch and/or 36-inch nominal diameter HDPE (high-density polyethylene) pipe meeting the applicable requirements of ASTM D3350, ASTM F714, and AWWA C906 (or successor standards). Pipe joints shall be heat-fused (butt-fused or electrofusion) in accordance with the pipe manufacturer's specifications and applicable ASTM standards. All valves, fittings, and appurtenances shall be of materials and construction compatible with the HDPE pipeline system and suitable for the intended service conditions, including internal pressure, soil conditions, and environmental exposure.

7.3 As-Built Drawings. Within ninety (90) days following the completion of pipeline installation within the Easement Area, Grantee shall provide Grantor with a complete set of as-built survey drawings showing the horizontal and vertical location of the installed pipeline, including all appurtenances, within the Easement Area. The as-built drawings shall be prepared by Ironclad Surveying & Land Services LLC or another surveyor licensed in the State of Washington and shall be certified by the preparing surveyor. The as-built drawings shall include, at a minimum, the pipeline centerline alignment, depth of cover at surveyed stations, locations of all above-ground and below-ground appurtenances, and horizontal and vertical coordinates referenced to the Washington State Plane Coordinate System (North Zone, NAD 83) and the North American Vertical Datum of 1988 (NAVD 88).

7.4 Compliance with Permits. All activities related to the installation, operation, maintenance, repair, and replacement of the Force-Main Pipeline within the Easement Area shall be conducted in compliance with all applicable federal, state, and local laws, regulations, ordinances, permits, and approvals. Without limiting the generality of the foregoing, Grantee shall comply with the following, to the extent applicable:

(a) Section 404 and Section 10 permits issued by the U.S. Army Corps of Engineers, Seattle District;

(b) Section 401 Water Quality Certification issued by the Washington State Department of Ecology;

(d) Whatcom County grading, clearing, and stormwater permits;

(e) Washington State Environmental Policy Act (SEPA) determinations;

(f) National Pollutant Discharge Elimination System (NPDES) Construction Stormwater General Permit;

(g) Whatcom County Critical Areas Ordinance (WCC Title 16); and

(h) All other applicable regulatory requirements, including the Washington Industrial Safety and Health Act (WISHA) and applicable Occupational Safety and Health Administration (OSHA) standards.

Grantee shall furnish copies of all permits directly applicable to work within the Easement Area to Grantor upon Grantor's written request.

ARTICLE 8 — SURFACE RESTORATION OBLIGATIONS

8.1 Construction Restoration. Following the completion of initial pipeline installation during the Temporary Construction Period, and following the completion of any subsequent maintenance, repair, replacement, or other activity requiring excavation or surface disturbance within the Easement Area or on any other portion of the Burdened Property, Grantee shall, at Grantee's sole cost and expense, restore the surface of the Easement Area and all other disturbed portions of the Burdened Property to a condition substantially similar to the pre-construction or pre-disturbance condition (the "Restoration Standards"). Restoration shall include, without limitation, all of the following:

(a) Backfilling and Compaction. Backfilling of all trenches, excavations, and borings with suitable materials and compaction to engineered standards consistent with the pipeline design and in a manner that prevents future settlement, subsidence, or differential compaction that would adversely affect the finished grade or agricultural use of the surface.

(b) Re-Grading. Re-grading of the disturbed area to match pre-construction surface contours, slopes, and drainage patterns. Grantee shall take particular care to ensure that surface drainage is not impeded or redirected as a result of construction or restoration activities.

(c) Topsoil Replacement. Segregation, stockpiling, and replacement of topsoil to its pre-construction depth and location. Topsoil shall be stripped and stockpiled separately from subsoil prior to excavation and shall be replaced as the final surface layer following backfilling and re-grading. If topsoil is lost, damaged, or contaminated during construction, Grantee shall import and place replacement topsoil of comparable quality and depth.

(d) Reseeding. Reseeding of all disturbed areas with an agricultural grass seed mix, forage seed mix, or crop species appropriate to Grantor's dairy farming operations, as mutually agreed upon by the Parties. If the Parties cannot agree on the appropriate seed mix, the seed mix recommended by the Washington State University Whatcom County Extension Office for dairy pasture establishment in Whatcom County shall be used. Grantee shall apply seed, fertilizer, and soil amendments at rates recommended for the selected seed mix and shall be responsible for one cycle of reseeding if the initial seeding fails to achieve adequate establishment within one growing season.

(e) Removal of Debris and Materials. Removal of all construction debris, excess spoil, unused materials, temporary structures, temporary fencing, construction signage, and temporary facilities from the Burdened Property within thirty (30) days following completion of the relevant activity.

(f) Repair or Replacement of Damaged Improvements. Repair or replacement, at Grantee's sole cost and expense, of any fencing (including permanent and temporary agricultural fencing), irrigation systems, drainage tiles, culverts, farm roads, access lanes, and other agricultural improvements or infrastructure on the Burdened Property that are damaged, displaced, or removed as a result of Grantee's exercise of the Permitted Activities. Repairs and replacements shall be of materials and workmanship at least equal in quality to the original improvements.

8.2 Timeline for Restoration. Surface restoration shall be completed within ninety (90) calendar days following the completion of the relevant construction, maintenance, repair, or replacement activity, weather and soil conditions permitting. If weather conditions, saturated soil conditions, or other seasonal factors prevent the timely completion of restoration within the ninety-day period, Grantee shall complete restoration as soon as practicable during the next available growing season or dry-weather period. Grantee shall notify Grantor in writing if restoration cannot be completed within the ninety-day period, specifying the reason for the delay and the anticipated completion date.

8.3 Crop Damage Compensation. Grantee shall compensate Grantor for any documented crop damage, loss of forage, loss of pasture productivity, or other loss of agricultural productivity suffered by Grantor as a direct result of Grantee's exercise of the Permitted Activities, including but not limited to the loss of dairy pasture during the Temporary Construction Period and subsequent restoration periods. Crop damage compensation shall be valued at the fair market value of the affected crop type or forage based on current market prices at the time of the loss, taking into account the estimated yield of the affected area and any mitigation measures undertaken by Grantor to reduce losses. Crop damage compensation shall be determined as follows:

(a) Grantor shall submit a written claim to Grantee within sixty (60) days following the occurrence of the damage or loss, together with reasonable documentation supporting the claim, including the type and quantity of crop or forage lost, the affected acreage, applicable market prices, and any other relevant information.

(b) Grantee shall review the claim and shall, within thirty (30) days following receipt of the claim, either approve the claim and tender payment to Grantor, or notify Grantor in writing of any dispute regarding the claim amount.

(c) If the Parties are unable to agree on the amount of crop damage compensation within thirty (30) days following Grantee's notice of dispute, the amount shall be determined by an independent agricultural appraiser or crop loss adjuster mutually selected by the Parties. If the Parties cannot agree on an independent appraiser within fifteen (15) days, each Party shall select one independent agricultural appraiser, and the two selected appraisers shall jointly select a third appraiser whose determination shall be final and binding on both Parties. The cost of the independent appraiser(s) shall be borne equally by the Parties.

8.4 Livestock Protections. During any construction, maintenance, repair, or replacement activities within the Easement Area, Grantee shall, at Grantee's sole cost and expense, install and maintain temporary fencing as necessary to prevent livestock from entering active work zones, open trenches, equipment staging areas, and other areas that may pose a risk of injury to livestock or interference with construction operations. Temporary fencing shall be of a type and construction adequate to contain the type of livestock present on the Burdened Property. Grantee shall coordinate with Grantor in advance of commencing any significant work activity to minimize disruption to Grantor's dairy operations, including, where practicable, scheduling activities outside of critical calving periods, milking periods, and periods of cattle movement between pastures. Grantee shall promptly notify Grantor of any injury to or death of livestock attributable to Grantee's activities, and Grantee shall compensate Grantor for any such injury or death at the fair market value of the affected livestock.

ARTICLE 9 — ACCESS PROVISIONS

9.1 Routine Access. For routine inspection and maintenance activities (including but not limited to visual inspection, pipeline marker inspection, cathodic protection system monitoring, air-release valve inspection, and similar non-invasive activities), Grantee shall provide Grantor with no less than forty-eight (48) hours' prior notice, which may be delivered in writing (by mail, email, or hand delivery) or orally (by telephone), before entering the Burdened Property. Grantee shall use existing farm roads and established access points as depicted on Exhibit D where practicable and shall avoid crossing active crop fields, pastures in use, and areas where livestock are present, to the extent reasonably feasible. Routine access shall be conducted during normal business hours (7:00 a.m. to 6:00 p.m., Monday through Friday) unless otherwise agreed by the Parties.

9.2 Emergency Access. In the event of a pipeline failure, leak, rupture, blockage, or other emergency condition posing an imminent threat to public health, safety, the environment, or property (including the Burdened Property), Grantee and its agents, contractors, and emergency response personnel may enter the Burdened Property and the Easement Area at any time, without prior notice, and may take such action as Grantee deems reasonably necessary to address the emergency, including excavation, repair, isolation, shutdown, or remediation. Grantee shall notify Grantor as soon as practicable following any emergency entry, and in no event later than twenty-four (24) hours following such entry, by telephone and written notice. Following resolution of the emergency, Grantee shall restore the Burdened Property and the Easement Area in accordance with the Restoration Standards set forth in Article 8.

9.3 Construction Access. During the Temporary Construction Period and during any subsequent major repair, replacement, or rehabilitation activity requiring the mobilization of heavy equipment or the establishment of a work zone, Grantee shall establish access routes in advance in consultation with Grantor, with the objective of minimizing disruption to Grantor's dairy operations and damage to the Burdened Property. Construction access routes shall follow existing farm roads and access lanes as depicted on Exhibit D to the extent practicable. If Grantee determines that additional or alternative access routes are necessary, Grantee shall notify Grantor in advance and shall use commercially reasonable efforts to select routes that avoid active pastures, crop fields, and sensitive environmental areas. Following the completion of construction, repair, or replacement activities, Grantee shall restore any damage to access routes, farm roads, drainage features, culverts, and other improvements caused by construction access to their pre-construction condition, at Grantee's sole cost and expense.

9.4 Gate and Key. If Grantee installs any locked gates, barriers, or access control devices within the Easement Area, Grantor shall be provided with keys, access codes, or other means of access to such gates, barriers, or devices. Conversely, if Grantor maintains locked gates, barriers, or access control devices on the Burdened Property that affect or control access to the Easement Area, Grantor shall provide Grantee with keys, access codes, or other means of access to such gates, barriers, or devices, and Grantor shall not change or modify such locks or access codes without providing updated keys or codes to Grantee within five (5) business days. Each Party shall exercise reasonable care to secure any locked gates after passage.

ARTICLE 10 — INDEMNIFICATION AND LIABILITY

10.1 Grantee's Indemnification. Grantee shall indemnify, defend, and hold harmless Grantor, its officers, directors, shareholders, members, employees, agents, tenants, and invitees (collectively, the "Grantor Indemnitees") from and against any and all claims, demands, actions, causes of action, damages, losses, liabilities, costs, and expenses (including reasonable attorneys' fees and costs of litigation) arising out of or related to (a) Grantee's exercise of the Permitted Activities, (b) Grantee's use of or presence on the Easement Area or the Burdened Property, (c) any act or omission of Grantee or its officers, employees, agents, or contractors in connection with this Agreement, or (d) any breach by Grantee of any representation, warranty, or obligation under this Agreement, except in each case to the extent that such claims, damages, or losses are caused by the negligence or willful misconduct of any Grantor Indemnitee.

10.2 Grantor's Indemnification. Grantor shall indemnify, defend, and hold harmless Grantee, its officers, directors, employees, agents, and contractors (collectively, the "Grantee Indemnitees") from and against any and all claims, demands, actions, causes of action, damages, losses, liabilities, costs, and expenses (including reasonable attorneys' fees and costs of litigation) arising out of or related to (a) any breach by Grantor of any representation, warranty, or obligation under this Agreement, or (b) any negligence or willful misconduct of Grantor or Grantor's officers, employees, agents, tenants, or invitees in connection with the Burdened Property or the Easement Area, except in each case to the extent that such claims, damages, or losses are caused by the negligence or willful misconduct of any Grantee Indemnitee.

10.3 Limitation on Sovereign Immunity Waiver. Nothing in this Agreement shall be construed as a waiver, in whole or in part, of Grantee's sovereign immunity, governmental immunity, or any statutory limitation on liability provided by applicable law, including without limitation the provisions of Chapter 4.92 RCW (Actions and Claims Against State) and any other applicable provisions of the Revised Code of Washington. Grantee's indemnification obligations under Section 10.1 are subject to, and shall be limited by, any applicable statutory limitations on governmental liability.

10.4 Environmental Liability. Grantee shall be solely responsible for any environmental contamination, pollution, release of hazardous substances, or other environmental condition arising from or caused by the installation, operation, maintenance, repair, replacement, or removal of the Force-Main Pipeline or any appurtenances within the Easement Area, and Grantee shall remediate any such contamination in accordance with applicable environmental laws. Grantor shall remain solely responsible for any pre-existing environmental conditions on the Burdened Property that are not caused by Grantee's activities. The Parties acknowledge that Pinnacle Geotechnical & Environmental Consulting Inc. performed a Phase I Environmental Site Assessment of the Burdened Property, dated January 22, 2025, and that such assessment identified no recognized environmental conditions (as defined in ASTM E1527-21) on the Burdened Property as of the date of the assessment. Nothing in this Section shall limit either Party's obligations or liabilities under applicable federal, state, or local environmental laws and regulations.

ARTICLE 11 — INSURANCE

11.1 Grantee's Insurance. Grantee shall maintain, or shall cause its contractors and subcontractors to maintain, during the Temporary Construction Period and during any subsequent construction, repair, replacement, or rehabilitation activity conducted within the Easement Area or on the Burdened Property, the following minimum insurance coverages:

(a) Commercial General Liability Insurance. Commercial general liability insurance (occurrence form) with limits of not less than Two Million Dollars ($2,000,000) per occurrence and Five Million Dollars ($5,000,000) in the annual aggregate, covering bodily injury, property damage, personal injury, and advertising injury. Such policy shall include coverage for completed operations, products liability, and contractual liability. Grantor and Dunlap Creek Ranch Inc. shall be named as additional insureds on such policy with respect to activities arising out of or related to this Agreement.

(b) Workers' Compensation Insurance. Workers' compensation insurance as required by the laws of the State of Washington (Title 51 RCW), covering all employees, agents, and workers engaged in activities within the Easement Area or on the Burdened Property. Employer's liability coverage shall be maintained with limits of not less than One Million Dollars ($1,000,000) per occurrence.

(c) Automobile Liability Insurance. Automobile liability insurance covering all owned, hired, and non-owned vehicles used in connection with activities within the Easement Area or on the Burdened Property, with limits of not less than One Million Dollars ($1,000,000) per occurrence for bodily injury and property damage.

11.2 Self-Insurance. Notwithstanding Section 11.1, Grantee may self-insure any or all of the coverages required by Section 11.1, in whole or in part, consistent with Grantee's status as a Washington State governmental instrumentality and its established self-insurance program. Grantee's election to self-insure shall not reduce or limit Grantee's indemnification obligations under Article 10.

11.3 Evidence of Insurance. Upon Grantor's written request, made not more than once per calendar year (or at any time following an occurrence giving rise to a claim), Grantee shall provide Grantor with certificates of insurance or other reasonable evidence of insurance coverage or self-insurance within thirty (30) days following receipt of such request.

ARTICLE 12 — REPRESENTATIONS AND WARRANTIES

12.1 Grantor Represents and Warrants. Grantor hereby represents and warrants to Grantee, as of the date of this Agreement, as follows:

(a) Organization and Good Standing. Grantor is a corporation duly organized, validly existing, and in good standing under the laws of the State of Washington, with its registration current and in compliance with the requirements of the Washington Secretary of State.

(b) Authority. Garrett Dunlap, as President and Sole Director of Dunlap Creek Ranch Inc., is duly authorized to execute, deliver, and perform this Agreement on behalf of Grantor, and to grant the Easement described herein. Maureen Dunlap, as Secretary/Treasurer of Dunlap Creek Ranch Inc., has attested to such authorization by resolution of the Board of Directors (or sole director action in lieu thereof) adopted in accordance with the corporation's articles of incorporation and bylaws.

(c) No Conflicts. The execution, delivery, and performance of this Agreement, and the grant of the Easement, do not and will not (i) violate or conflict with the articles of incorporation, bylaws, or other organizational documents of Grantor, (ii) violate, conflict with, result in a breach or default under, or give rise to a right of termination, acceleration, or modification of any agreement, instrument, mortgage, deed of trust, lease, license, order, judgment, or decree binding upon Grantor or the Burdened Property, or (iii) violate any applicable law, regulation, or order, subject in each case to existing encumbrances disclosed in the title commitment issued by Cascade Basin Title Company for the Burdened Property.

(d) Title. Grantor has good and marketable fee simple title to the Burdened Property, free and clear of all liens, encumbrances, claims, and interests except for matters of record as disclosed in the title commitment issued by Cascade Basin Title Company and approved exceptions acceptable to Grantee.

12.2 Grantee Represents and Warrants. Grantee hereby represents and warrants to Grantor, as of the date of this Agreement, as follows:

(a) Organization and Existence. Grantee is a governmental instrumentality of the State of Washington, duly created and validly existing under and pursuant to Chapter 43.99N of the Revised Code of Washington, with full power, authority, and legal capacity to own property, enter into contracts, and carry out the purposes for which it was created, including the acquisition of easements and rights-of-way for public infrastructure projects.

(b) Authority and Approval. The execution, delivery, and performance of this Agreement by Grantee, and the acceptance of the Easement, have been duly authorized by all necessary governmental action, including any required approval of the CSIA Board of Directors, CSIA Executive Director, or other governing body or officer, and no further governmental action, approval, consent, or authorization is required for the execution, delivery, or performance of this Agreement by Grantee.

ARTICLE 13 — DEFAULT AND REMEDIES

13.1 Default. A Party shall be in default under this Agreement if such Party fails to perform, observe, or comply with any material obligation, covenant, condition, or provision of this Agreement and such failure continues for a period of thirty (30) days after the non-defaulting Party delivers written notice to the defaulting Party specifying the nature of the default with reasonable particularity. Notwithstanding the foregoing, if the nature of the default is such that it cannot reasonably be cured within thirty (30) days, the defaulting Party shall not be deemed in default if the defaulting Party commences curative action within the thirty-day notice period and thereafter diligently and continuously pursues such cure to completion within a reasonable time, but in no event more than ninety (90) days following receipt of the notice of default (unless an extension is agreed to in writing by the non-defaulting Party).

13.2 Remedies. Upon the occurrence of a default that remains uncured following the expiration of the applicable cure period, the non-defaulting Party may pursue any and all remedies available at law or in equity, including but not limited to specific performance of the defaulting Party's obligations, injunctive relief (temporary, preliminary, or permanent), and recovery of monetary damages. The Parties acknowledge that damages at law may be inadequate to compensate the non-defaulting Party for a breach of this Agreement and that specific performance and injunctive relief are appropriate remedies. No remedy set forth in this Agreement is intended to be exclusive; all remedies are cumulative and are in addition to any other remedies available at law, in equity, or under any other agreement.

13.3 Attorneys' Fees. In any action, suit, arbitration, or proceeding brought to enforce any provision of this Agreement, to interpret this Agreement, or arising out of or related to a default under this Agreement, the prevailing Party shall be entitled to recover from the non-prevailing Party its reasonable attorneys' fees, costs, and expenses (including expert witness fees and costs of appeal), in addition to any other relief to which such prevailing Party may be entitled.

ARTICLE 14 — CONDEMNATION AUTHORITY PRESERVED

14.1 Nothing in this Agreement shall be construed to limit, waive, restrict, or diminish Grantee's power of eminent domain under Chapter 43.99N RCW or under any other provision of the Revised Code of Washington or applicable law. Grantee expressly reserves the right to exercise its power of eminent domain to acquire fee title, additional easement interests, or other property rights in the Burdened Property or any adjacent or nearby property if Grantee determines, in its sole discretion, that such additional interests are necessary or desirable for the Project or for any future expansion, modification, or improvement of the Project.

14.2 The Parties acknowledge and agree that this Agreement has been entered into voluntarily by both Parties and constitutes a negotiated transaction undertaken in satisfaction of Grantee's obligation to make a good-faith offer to Grantor pursuant to RCW Chapter 8.25 (Uniform Condemnation Procedures Act) prior to commencing condemnation proceedings. This Agreement is intended to document the terms upon which the Parties have agreed to establish the Easement in lieu of condemnation, and the Easement Compensation reflects the negotiated value of the easement interest, determined with reference to the appraisal described in Recital D and Section 5.1.

ARTICLE 15 — ASSIGNMENT AND SUCCESSORS

15.1 Grantee's Right to Assign. Grantee may assign, transfer, or convey its rights, interests, and obligations under this Agreement and in the Easement, in whole or in part, to any governmental entity, public utility, quasi-governmental instrumentality, or successor instrumentality of the State of Washington, without the consent of Grantor, provided that the assignee expressly assumes in writing all of Grantee's obligations under this Agreement from and after the effective date of such assignment. Grantee shall provide written notice to Grantor of any such assignment within thirty (30) days following the effective date of the assignment, together with a copy of the instrument of assignment and assumption. Upon any assignment in which the assignee assumes all of Grantee's obligations, Grantee shall be released from further liability under this Agreement arising from and after the effective date of such assignment.

15.2 Binding on Successors. This Agreement and the Easement granted herein shall run with the land and shall be binding upon and inure to the benefit of the Parties and their respective heirs, successors, personal representatives, and assigns. Any conveyance of the Burdened Property or any portion thereof by Grantor shall be subject to the Easement and the terms of this Agreement, and Grantor's successor in interest shall be bound by all of the terms, conditions, restrictions, and obligations imposed upon Grantor hereunder.

ARTICLE 16 — GENERAL PROVISIONS

16.1 Governing Law. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Washington, without regard to conflict of laws principles.

16.2 Venue. Any action, suit, or proceeding arising under or in connection with this Agreement shall be brought exclusively in the Superior Court of the State of Washington for Whatcom County, located in Bellingham, Washington, and each Party hereby consents to the personal jurisdiction and venue of such court.

16.3 Entire Agreement. This Agreement, together with all Exhibits attached hereto and incorporated herein by reference (Exhibits A, B, C, and D), constitutes the entire agreement between the Parties with respect to the pipeline corridor easement described herein and supersedes all prior and contemporaneous negotiations, discussions, proposals, representations, understandings, and agreements, whether written or oral, between the Parties relating to the subject matter hereof.

16.4 Amendments. This Agreement may not be amended, modified, supplemented, or waived except by a written instrument executed by both Parties (or their authorized successors or assigns) and recorded with the Whatcom County Auditor. No oral modification or amendment of this Agreement shall be effective for any purpose.

16.5 Severability. If any provision of this Agreement, or the application of any provision to any Person or circumstance, is held by a court of competent jurisdiction to be invalid, illegal, or unenforceable, the remainder of this Agreement, and the application of such provision to other Persons or circumstances, shall not be affected thereby, and each remaining provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. In the event that any provision is held to be invalid, illegal, or unenforceable, the Parties shall negotiate in good faith to modify this Agreement to give effect to the original intent of the Parties as closely as possible.

16.6 Notices. All notices, requests, demands, consents, approvals, and other communications required or permitted under this Agreement shall be in writing and shall be deemed duly given and received (a) when delivered personally, (b) on the date of confirmed delivery by a nationally recognized overnight courier service (such as Severin Partners LLC, Halcyon Partners LLC, or Tarrant & Co.), (c) on the third (3rd) business day following deposit in the United States mail, sent by certified mail, return receipt requested, postage prepaid, or (d) on the date of confirmed transmission by email if followed by delivery of a hard copy by one of the methods specified in clauses (a) through (c) within three (3) business days, in each case addressed to the appropriate Party at the following addresses (or at such other address as such Party may designate by written notice to the other Party):

If to Grantor:

Dunlap Creek Ranch Inc.

Attn: Garrett Dunlap, President

18500 Guide Meridian Road Lynden, WA 98264

If to Grantee:

Cascadia State Infrastructure Authority

Attn: General Counsel (Priya Shankar-Wells)

1100 Jefferson Avenue SE, Suite 400 Olympia, WA 98501

With a copy to (which shall not constitute notice):

Calderwood & Harkness LLP

Attn: Angela Fontaine

999 Second Avenue, Suite 4200 Seattle, WA 98104

16.7 Recording. This Agreement shall be recorded in the official real property records of the Whatcom County Auditor as promptly as practicable following execution and delivery by both Parties. Grantee shall be responsible for the payment of all recording fees and any applicable transfer or excise taxes, if any. Following recording, Grantee shall provide Grantor with a conformed copy of the recorded Agreement bearing the recording information.

16.8 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures delivered by facsimile or electronic transmission (including PDF) shall be deemed original signatures for all purposes.

16.9 No Third-Party Beneficiaries. This Agreement is entered into for the sole and exclusive benefit of the Parties and their respective permitted successors and assigns. Nothing in this Agreement, whether express or implied, is intended to confer upon any person or entity other than the Parties (and their permitted successors and assigns) any rights, remedies, obligations, or liabilities of any nature whatsoever.

16.10 Waiver. The failure of either Party to enforce any provision of this Agreement, or to exercise any right or remedy hereunder, shall not constitute a waiver of such provision, right, or remedy, or of the right to enforce any provision or exercise any right or remedy in the future. No waiver of any provision, right, or remedy shall be effective unless set forth in a written instrument signed by the waiving Party. Any waiver granted shall be limited to the specific instance and shall not constitute a waiver of any other or subsequent breach, default, or occasion.

16.11 Headings. The article and section headings contained in this Agreement are for convenience of reference only and shall not be used in the interpretation or construction of any provision of this Agreement. References to articles, sections, and exhibits are to articles, sections, and exhibits of this Agreement unless otherwise specified.

16.12 Relationship to Other Easements. This Agreement is separate from and in addition to the following related agreements between Grantor and Grantee entered into in connection with the Project:

(i) The Permanent Easement Agreement between Grantor (or its affiliate) and Grantee for Pump Station No. 3 (PS-3), encumbering Whatcom County Parcel No. 380220-108400 (the "PS-3 Easement Agreement"); and

(ii) The Temporary Construction Easement Agreement between Grantor and Grantee for construction staging, laydown areas, and temporary pipeline installation activities on Grantor's parcels in connection with the Project (the "TCE Agreement").

The rights, obligations, and easement interests established by this Agreement are independent of, and shall not be affected by, the terms, conditions, expiration, or termination of the PS-3 Easement Agreement or the TCE Agreement, and vice versa. In the event of any inconsistency between this Agreement and either the PS-3 Easement Agreement or the TCE Agreement with respect to the Burdened Property, the terms of this Agreement shall control with respect to the Easement Area.

[Signature Pages Follow]

IN WITNESS WHEREOF, the Parties have executed this Permanent Pipeline Corridor Easement Agreement as of the date first set forth above.

GRANTOR

DUNLAP CREEK RANCH INC., a Washington corporation

By: ________

Name: Garrett Dunlap

Title: President and Sole Director

Date: ________

ATTEST:

By: ________

Name: Maureen Dunlap

Title: Secretary/Treasurer

GRANTEE

CASCADIA STATE INFRASTRUCTURE AUTHORITY, a Washington State governmental instrumentality

By: ________

Name: Martin R. Calloway

Title: Executive Director

Date: ________

APPROVED AS TO FORM:

By: ________

Name: Priya Shankar-Wells

Title: General Counsel

ACKNOWLEDGMENT — GRANTOR

STATE OF WASHINGTON

COUNTY OF WHATCOM

On this __ day of _____, 2025, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared Garrett Dunlap, to me known (or proved to me on the basis of satisfactory evidence) to be the President and Sole Director of Dunlap Creek Ranch Inc., the corporation that executed the within and foregoing instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said corporation, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute the said instrument on behalf of the corporation.

WITNESS my hand and official seal hereto affixed the day and year in this certificate first above written.

________________________________________

Notary Public in and for the State of Washington

Printed Name: ________

Residing at: ________ My commission expires: ________

ACKNOWLEDGMENT — GRANTEE

STATE OF WASHINGTON

COUNTY OF THURSTON

On this __ day of _____, 2025, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared Martin R. Calloway, to me known (or proved to me on the basis of satisfactory evidence) to be the Exec

After recording, return to:
Calderwood & Harkness LLP 999 Second Avenue, Suite 4200 Seattle, WA 98104
Attention: Grace Nakamura
Space above reserved for Whatcom County Auditor recording stamp, document number, and recording date.
PERMANENT PIPELINE CORRIDOR EASEMENT AGREEMENT
Force-Main Pipeline Easement — Parcel No. 380220-108401
Part of the Lower Nooksack Pump Station Network CSIA Capital Project No. CP-2025-NPS-004
This PERMANENT PIPELINE CORRIDOR EASEMENT AGREEMENT (this "Agreement") is entered into as of _____, 2025 (the "Effective Date"), by and between:
GRANTOR: Dunlap Creek Ranch Inc., a Washington corporation (S-corporation), with its registered agent address at 18500 Guide Meridian Road, Lynden, WA 98264. The authorized signatory on behalf of Grantor is Garrett Dunlap, President and Sole Director of Dunlap Creek Ranch Inc. ("Grantor").
GRANTEE: Cascadia State Infrastructure Authority, a Washington State governmental instrumentality created and existing pursuant to Chapter 43.99N of the Revised Code of Washington, with its headquarters located at 1100 Jefferson Avenue SE, Suite 400, Olympia, WA 98501 ("Grantee" or "CSIA").
Grantor and Grantee are collectively referred to herein as the "Parties" and individually as a "Party."
RECITALS
A. Grantor's Ownership. Grantor is the owner in fee simple of approximately ninety-four (94) acres of dairy farmland located along Hannegan Road, Whatcom County, Washington, including the real property identified by the Whatcom County Assessor as Parcel No. 380220-108401 (the "Burdened Property"), which is more particularly described in the legal description attached hereto as Exhibit A and incorporated herein by this reference.
B. Grantee's Project. Grantee is developing the Regional Flood Resilience and Stormwater Management Program — Lower Nooksack Pump Station Network (the "Project"), designated as CSIA Capital Project No. CP-2025-NPS-004. The Project consists of the construction and operation of four pump stations (PS-1, PS-2, PS-3, and PS-4) and approximately 6.2 miles of 24-inch and 36-inch high-density polyethylene (HDPE) force-main pipeline connecting all four pump stations to the existing Nooksack Regional Wastewater Treatment Plant outfall. The total estimated capital cost of the Project is Forty-Eight Million Dollars ($48,000,000), funded through a combination of (i) a Washington State Capital Appropriation pursuant to Senate Bill 5140, 2025 Legislative Session, in the amount of Thirty-One Million Two Hundred Thousand Dollars ($31,200,000), and (ii) CSIA Series 2025A Revenue Bonds in the aggregate principal amount of Sixteen Million Eight Hundred Thousand Dollars ($16,800,000).
C. Pipeline Corridor Need. A segment of the force-main pipeline corridor traverses the Burdened Property. Grantee requires a permanent easement across the Burdened Property for the installation, operation, maintenance, repair, replacement, and removal of the force-main pipeline and associated appurtenances necessary for the Project.
D. Condemnation Authority. Grantee possesses the power of eminent domain pursuant to Chapter 43.99N RCW and applicable provisions of the Revised Code of Washington. Grantee has made a good-faith offer to Grantor in compliance with the requirements of RCW Chapter 8.25 (Uniform Condemnation Procedures Act), based upon an appraisal of the Burdened Property and the easement interest prepared by Northwind Valuation Group LLC (Jocelyn Trueblood, MAI, appraiser), dated March 14, 2025. The appraisal was performed in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP) and the methodology prescribed by the Uniform Appraisal Standards for Federal Land Acquisitions (commonly known as the "Yellow Book").
E. Voluntary Agreement. The Parties desire to establish the permanent easement rights described herein by voluntary agreement in lieu of condemnation proceedings, on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the Easement Compensation described in Article 5, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE 1 — DEFINITIONS
As used in this Agreement, the following terms shall have the meanings ascribed to them below. Capitalized terms used but not defined herein shall have the meanings given to them in the context in which they appear.
1.1 "Agreement" means this Permanent Pipeline Corridor Easement Agreement, including all Exhibits attached hereto, as the same may be amended, supplemented, or modified from time to time in accordance with the provisions hereof.
1.2 "Burdened Property" means the real property located in Whatcom County, Washington, identified by the Whatcom County Assessor as Parcel No. 380220-108401, and more particularly described in the legal description attached hereto as Exhibit A.
1.3 "Easement Area" means the linear corridor located on and across the Burdened Property as depicted on the Easement Plat attached hereto as Exhibit B and described by the metes-and-bounds legal description attached hereto as Exhibit C. The Easement Plat and metes-and-bounds legal description were prepared by Ironclad Surveying & Land Services LLC (Karen Whitfield, Professional Land Surveyor), with offices located at 4850 Cordata Parkway, Suite 110, Bellingham, WA 98226.
1.4 "Force-Main Pipeline" means the 24-inch and 36-inch HDPE (high-density polyethylene) force-main pipeline to be installed within the Easement Area, together with all associated appurtenances, including but not limited to valves, fittings, cleanouts, air-release valves, manholes, marker posts, cathodic protection systems, and all other infrastructure and equipment necessary for, or incidental to, the operation of the pipeline.
1.5 "Project" means the Regional Flood Resilience and Stormwater Management Program — Lower Nooksack Pump Station Network, designated as CSIA Capital Project No. CP-2025-NPS-004, as more fully described in Recital B above.
1.6 "Temporary Construction Period" means the period during which the initial construction and installation of the Force-Main Pipeline occurs within the Easement Area, commencing upon the recording of this Agreement with the Whatcom County Auditor and terminating upon the earlier of (a) Grantee's delivery to Grantor of written notice of construction completion, or (b) twenty-four (24) months from the date of recording of this Agreement.
1.7 "Permitted Activities" means the activities described in and authorized by Article 3 of this Agreement.
1.8 "Restoration Standards" means the standards for surface restoration described in Article 8 of this Agreement.
ARTICLE 2 — GRANT OF EASEMENT
2.1 Grant. For and in consideration of the Easement Compensation and the mutual covenants contained herein, Grantor hereby grants, conveys, and warrants to Grantee, its successors and assigns, a permanent, non-exclusive easement and right-of-way in, on, over, under, across, and through the Easement Area for the purpose of conducting the Permitted Activities (the "Easement"). The Easement is conveyed with all rights and privileges reasonably necessary to effectuate the purposes set forth in this Agreement.
2.2 Easement in Gross. The Easement is an easement in gross and is not appurtenant to any particular dominant estate. The Easement runs with the Burdened Property, is binding upon Grantor and all successors, heirs, personal representatives, and assigns of Grantor, and shall inure to the benefit of Grantee and its successors and assigns. The Easement shall be enforceable by Grantee or any permitted assignee of Grantee.
2.3 Duration. The Easement is perpetual in nature and shall continue in full force and effect in perpetuity unless and until Grantee abandons the Easement by the execution, delivery, and recording of a written instrument of abandonment with the Whatcom County Auditor. Mere non-use of the Easement by Grantee shall not, in and of itself, constitute abandonment.
2.4 Non-Exclusive Nature. The Easement granted herein is non-exclusive. Grantor retains all rights of use and enjoyment of the Burdened Property, including the Easement Area, to the extent that such use is not inconsistent with the Easement or the Permitted Activities and is subject to the limitations, restrictions, and reservations set forth in Article 6 of this Agreement. Nothing in this Agreement shall be construed to prohibit Grantor from granting additional easements or rights-of-way across the Burdened Property to third parties, provided that any such additional easement or right-of-way does not unreasonably interfere with the Easement or the Permitted Activities, and provided that Grantor shall notify Grantee in writing prior to granting any easement or right-of-way that would encumber any portion of the Easement Area.
ARTICLE 3 — PERMITTED ACTIVITIES AND EASEMENT PURPOSE
The Easement is granted for the following purposes, which shall collectively constitute the "Permitted Activities":
3.1 Installation. The right to survey, excavate, grade, trench, install, construct, lay, backfill, and compact the Force-Main Pipeline (including both 24-inch and 36-inch HDPE lines and all associated appurtenances) within the Easement Area in accordance with the Project plans, specifications, and applicable permits.
3.2 Operation. The right to operate, use, and control the Force-Main Pipeline for the conveyance of wastewater, stormwater, and other flows as part of the approximately 6.2-mile pipeline network connecting the four pump stations (PS-1, PS-2, PS-3, and PS-4) to the Nooksack Regional Wastewater Treatment Plant outfall. Operation includes all monitoring, testing, flow regulation, and system management activities necessary for the proper functioning of the Force-Main Pipeline and the Project.
3.3 Maintenance and Repair. The right to inspect, monitor, maintain, repair, rehabilitate, clean, flush, and perform pigging and internal inspection activities on the Force-Main Pipeline and all appurtenances, including the right to conduct routine, scheduled inspections and preventive maintenance as well as emergency repairs as circumstances may require. Maintenance and repair activities include, without limitation, excavation to expose the pipeline, repair or replacement of damaged sections, joint repair, valve and fitting replacement, and cathodic protection system maintenance.
3.4 Replacement and Upgrade. The right to remove and replace the Force-Main Pipeline, in whole or in part, with pipeline of comparable or improved specifications, including replacement with pipe of the same or different material (provided that the replacement material meets applicable engineering standards), provided that the replacement pipeline remains within the Easement Area as depicted on the Easement Plat and described in the metes-and-bounds description. This right includes the ability to upgrade the pipeline system to accommodate increased capacity or improved technology, subject to the Easement Area boundaries.
3.5 Appurtenances. The right to install, maintain, repair, replace, and operate all appurtenances and ancillary facilities necessary for, or incidental to, the operation and maintenance of the Force-Main Pipeline, including but not limited to valves, fittings, tees, reducers, cleanouts, air-release valves (both automatic and manual), vacuum relief valves, manholes, pipeline markers and warning signs, cathodic protection systems (including test stations, anodes, and rectifiers), and such other equipment as may be reasonably necessary.
3.6 Access. The right of ingress and egress, at all times and from time to time, across the Burdened Property to and from the Easement Area, using reasonable routes and existing farm roads where practicable, for the purpose of conducting any Permitted Activity. Access rights include the right to bring upon the Burdened Property all personnel, vehicles, heavy equipment, machinery, materials, and supplies reasonably necessary for the Permitted Activities. Grantee shall use commercially reasonable efforts to minimize interference with Grantor's agricultural operations when exercising access rights. The approved access routes are depicted on the map attached hereto as Exhibit D.
3.7 Vegetation Management. The right to clear, cut, trim, remove, and manage vegetation within the Easement Area to the extent reasonably necessary for pipeline construction, installation, operation, maintenance, inspection, repair, replacement, and access. Without limiting the generality of the foregoing, Grantee shall have the right to remove any deep-rooted trees or woody vegetation that may establish within the Easement Area, as such vegetation is prohibited within the Easement Area pursuant to Section 6.2(b) of this Agreement. Grantee shall dispose of cleared vegetation in a commercially reasonable manner and shall not leave slash or debris within the Easement Area or on the Burdened Property.
ARTICLE 4 — EASEMENT AREA DESCRIPTION AND SURVEY
4.1 Legal Description. The Easement Area is that certain linear corridor located within and upon Whatcom County Parcel No. 380220-108401, as more particularly described in the metes-and-bounds legal description prepared by Ironclad Surveying & Land Services LLC (Karen Whitfield, Professional Land Surveyor, Washington PLS No. ___), attached hereto as Exhibit C and incorporated herein by this reference. In the event of any conflict between the Easement Plat (Exhibit B) and the metes-and-bounds legal description (Exhibit C), the metes-and-bounds legal description shall control.
4.2 Easement Plat. The Easement Area is graphically depicted on the Easement Plat attached hereto as Exhibit B, which has been prepared by Ironclad Surveying & Land Services LLC and which shows the location, configuration, and dimensions of the Easement Area in relation to the boundaries of the Burdened Property, existing physical features, and adjacent parcels. The Easement Plat is incorporated herein by this reference.
4.3 Width. The Easement Area shall be __ (__) feet in width, centered on the pipeline centerline as shown on the Easement Plat (Exhibit B). In the event of curves, angle points, or deviations in alignment, the width of the Easement Area shall be measured perpendicular to the pipeline centerline at all points along the corridor.
4.4 Markers. Following completion of initial pipeline installation and restoration of the Easement Area surface, Grantee shall, at Grantee's sole cost and expense, install permanent survey markers or monuments at each angle point along the Easement Area boundaries and at intervals of no more than five hundred (500) feet along the Easement Area boundaries in tangent (straight) sections. All survey markers and monuments shall be of durable construction and shall comply with the standards established by the Washington State Department of Natural Resources for survey monuments. In addition, Grantee shall install pipeline markers (including above-ground warning posts) at intervals and locations consistent with applicable industry standards and regulatory requirements, including any requirements of the Washington Utilities and Transportation Commission. All markers shall be designed and installed in a manner that accommodates typical agricultural and livestock activities on the Burdened Property.
ARTICLE 5 — COMPENSATION
5.1 Easement Compensation. In consideration of the Easement granted herein and the rights, privileges, and obligations set forth in this Agreement, Grantee shall pay to Grantor the total sum of _____ Dollars ($___) (the "Easement Compensation"). The Easement Compensation has been determined on the basis of a linear-foot valuation of the Easement Area as set forth in the appraisal prepared by Northwind Valuation Group LLC (Jocelyn Trueblood, MAI), dated March 14, 2025, which appraisal was prepared in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP) and the Uniform Appraisal Standards for Federal Land Acquisitions ("Yellow Book") methodology. The Easement Compensation represents the full and fair market value of the easement interest conveyed herein, including any diminution in value to the remainder of the Burdened Property resulting from the Easement, as determined by the appraisal.
5.2 Payment. The Easement Compensation shall be paid in full by wire transfer of immediately available funds to an account designated by Grantor in writing, or by certified or cashier's check made payable to "Dunlap Creek Ranch Inc.," within ten (10) business days following the date on which this Agreement is recorded with the Whatcom County Auditor. Grantee shall provide Grantor with written confirmation of payment promptly following disbursement. Grantor's acceptance of the Easement Compensation shall constitute a full and final settlement of all claims for compensation related to the Easement granted herein, subject to the provisions of Sections 5.4, 8.3, and Article 10 of this Agreement.
5.3 Title Insurance. Grantee shall obtain, at Grantee's sole cost and expense, a title insurance policy from Cascade Basin Title Company (title officer: Diane Ashworth, 119 East Magnolia Street, Bellingham, WA 98225), insuring the Easement in such amount and with such endorsements as Grantee may, in its sole discretion, require. Grantor shall cooperate with Grantee and the title company in connection with the issuance of such title insurance policy, including providing access to the Burdened Property for inspection and survey purposes and executing such affidavits and other documents as may be reasonably requested by the title company to facilitate the issuance of the policy. Nothing in this Section shall require Grantor to incur any cost or expense in connection with the title insurance policy.
5.4 No Further Compensation. Except as expressly provided in Section 8.3 (Crop Damage Compensation) and Article 10 (Indemnification and Liability), no additional compensation, rent, royalty, or other payment of any kind shall be payable by Grantee to Grantor for the Easement, the Permitted Activities, or any other right granted to Grantee under this Agreement, whether during the Temporary Construction Period or at any time thereafter.
ARTICLE 6 — GRANTOR'S RETAINED RIGHTS AND RESTRICTIONS
6.1 Retained Agricultural Use. Grantor retains the full right to use, occupy, and enjoy the Easement Area and the remainder of the Burdened Property for dairy farming, agricultural cultivation, livestock grazing, hay production, forage production, and all other lawful agricultural purposes, provided that such use does not unreasonably interfere with, impede, or prevent the exercise of the Permitted Activities by Grantee, and further provided that such use does not damage, endanger, or impair the structural or operational integrity of the Force-Main Pipeline or any appurtenances installed within the Easement Area. Grantor may conduct normal agricultural operations over and across the Easement Area, including plowing, disking, seeding, fertilizing, irrigating, and harvesting, subject to the depth restrictions set forth in Section 6.2(c) below.
6.2 Restrictions on Grantor's Use Within the Easement Area. Grantor agrees that, within the Easement Area, Grantor shall not undertake or permit any of the following activities without the prior written consent of Grantee (which consent may be withheld, conditioned, or delayed in Grantee's reasonable discretion):
(a) Structures and Improvements. No permanent structures, buildings, barns, sheds, silos, foundations, paved surfaces, concrete slabs, retaining walls, or other improvements of a permanent nature shall be constructed, placed, or maintained within the Easement Area. Notwithstanding the foregoing, Grantor may install and maintain agricultural fencing across or within the Easement Area, provided that such fencing is of a type that is readily removable to accommodate Grantee's access to the Easement Area, and provided that Grantor installs gates or removable panels at locations agreed upon by the Parties to ensure Grantee's unimpeded access.
(b) Trees and Woody Vegetation. No deep-rooted trees, shrubs, or woody vegetation shall be planted, cultivated, or permitted to grow within the Easement Area. Grantor shall promptly remove, or permit Grantee to remove, any volunteer trees or woody vegetation that establish within the Easement Area. Shallow-rooted agricultural grasses, pasture grasses, and annual row crops are permitted.
(c) Excavation and Grading. No excavation, grading, filling, ditching, soil removal, or other disturbance of the soil surface within the Easement Area shall be conducted to a depth greater than eighteen (18) inches below the existing finished grade without Grantor first providing written notice to Grantee and obtaining Grantee's prior written approval. Normal agricultural tillage operations to a depth not exceeding eighteen (18) inches are permitted without notice or approval.
(d) Blasting and Drilling. No blasting, drilling, pile-driving, or other percussive or vibratory activities shall be conducted within the Easement Area or within twenty-five (25) feet of any boundary of the Easement Area without Grantee's prior written consent.
(e) Storage of Equipment and Materials. Grantor shall not park, store, or stage heavy equipment, vehicles, or materials within the Easement Area in a manner that would impede or prevent Grantee's access to the Easement Area or that would impose loads on the pipeline exceeding its designed load-bearing capacity. Incidental crossing of the Easement Area by agricultural equipment in the ordinary course of farming operations is permitted.
(f) Water Impoundment and Drainage. No impoundment, diversion, or ponding of water shall be constructed or maintained within the Easement Area, and no alteration of existing surface or subsurface drainage patterns within the Easement Area shall be made, if such impoundment, diversion, ponding, or alteration could adversely affect the structural integrity, bedding, backfill, or cathodic protection of the Force-Main Pipeline.
6.3 Livestock. Grantor may graze livestock (including dairy cattle, beef cattle, horses, and other livestock customarily associated with dairy farming operations) across and upon the Easement Area, provided that such grazing activity does not damage pipeline markers, air-release valves, manholes, cathodic protection test stations, or other above-ground appurtenances or access routes. Grantee shall design and install all above-ground pipeline markers and appurtenances to be of durable construction and capable of withstanding typical agricultural and livestock activities, including incidental contact by livestock. If livestock damage to markers or appurtenances occurs despite the use of durable construction, Grantee shall bear the cost of repair or replacement of such markers or appurtenances and Grantor shall not be liable for such damage, except to the extent caused by Grantor's willful or negligent failure to manage livestock in a commercially reasonable manner.
ARTICLE 7 — DEPTH OF COVER AND PIPELINE SPECIFICATIONS
7.1 Minimum Depth of Cover. The Force-Main Pipeline shall be installed with a minimum depth of cover of forty-two (42) inches, measured from the finished grade of the ground surface to the top (crown) of the pipe at all points along the pipeline alignment within the Easement Area. If applicable engineering standards, manufacturer specifications, or any federal, state, or local permit or regulatory requirement mandates a greater depth of cover, the greater depth shall govern. In areas where the pipeline crosses existing drainage ditches, waterways, or roadways, the depth of cover shall be increased as necessary to provide adequate protection against erosion, scour, and applied surface loads.
7.2 Pipeline Materials. The Force-Main Pipeline shall consist of 24-inch and/or 36-inch nominal diameter HDPE (high-density polyethylene) pipe meeting the applicable requirements of ASTM D3350, ASTM F714, and AWWA C906 (or successor standards). Pipe joints shall be heat-fused (butt-fused or electrofusion) in accordance with the pipe manufacturer's specifications and applicable ASTM standards. All valves, fittings, and appurtenances shall be of materials and construction compatible with the HDPE pipeline system and suitable for the intended service conditions, including internal pressure, soil conditions, and environmental exposure.
7.3 As-Built Drawings. Within ninety (90) days following the completion of pipeline installation within the Easement Area, Grantee shall provide Grantor with a complete set of as-built survey drawings showing the horizontal and vertical location of the installed pipeline, including all appurtenances, within the Easement Area. The as-built drawings shall be prepared by Ironclad Surveying & Land Services LLC or another surveyor licensed in the State of Washington and shall be certified by the preparing surveyor. The as-built drawings shall include, at a minimum, the pipeline centerline alignment, depth of cover at surveyed stations, locations of all above-ground and below-ground appurtenances, and horizontal and vertical coordinates referenced to the Washington State Plane Coordinate System (North Zone, NAD 83) and the North American Vertical Datum of 1988 (NAVD 88).
7.4 Compliance with Permits. All activities related to the installation, operation, maintenance, repair, and replacement of the Force-Main Pipeline within the Easement Area shall be conducted in compliance with all applicable federal, state, and local laws, regulations, ordinances, permits, and approvals. Without limiting the generality of the foregoing, Grantee shall comply with the following, to the extent applicable:
(a) Section 404 and Section 10 permits issued by the U.S. Army Corps of Engineers, Seattle District;
(b) Section 401 Water Quality Certification issued by the Washington State Department of Ecology;
(c) Hydraulic Project Approval (HPA) issued by the Washington Department of Fish and Wildlife;
(d) Whatcom County grading, clearing, and stormwater permits;
(e) Washington State Environmental Policy Act (SEPA) determinations;
(f) National Pollutant Discharge Elimination System (NPDES) Construction Stormwater General Permit;
(g) Whatcom County Critical Areas Ordinance (WCC Title 16); and
(h) All other applicable regulatory requirements, including the Washington Industrial Safety and Health Act (WISHA) and applicable Occupational Safety and Health Administration (OSHA) standards.
Grantee shall furnish copies of all permits directly applicable to work within the Easement Area to Grantor upon Grantor's written request.
ARTICLE 8 — SURFACE RESTORATION OBLIGATIONS
8.1 Construction Restoration. Following the completion of initial pipeline installation during the Temporary Construction Period, and following the completion of any subsequent maintenance, repair, replacement, or other activity requiring excavation or surface disturbance within the Easement Area or on any other portion of the Burdened Property, Grantee shall, at Grantee's sole cost and expense, restore the surface of the Easement Area and all other disturbed portions of the Burdened Property to a condition substantially similar to the pre-construction or pre-disturbance condition (the "Restoration Standards"). Restoration shall include, without limitation, all of the following:
(a) Backfilling and Compaction. Backfilling of all trenches, excavations, and borings with suitable materials and compaction to engineered standards consistent with the pipeline design and in a manner that prevents future settlement, subsidence, or differential compaction that would adversely affect the finished grade or agricultural use of the surface.
(b) Re-Grading. Re-grading of the disturbed area to match pre-construction surface contours, slopes, and drainage patterns. Grantee shall take particular care to ensure that surface drainage is not impeded or redirected as a result of construction or restoration activities.
(c) Topsoil Replacement. Segregation, stockpiling, and replacement of topsoil to its pre-construction depth and location. Topsoil shall be stripped and stockpiled separately from subsoil prior to excavation and shall be replaced as the final surface layer following backfilling and re-grading. If topsoil is lost, damaged, or contaminated during construction, Grantee shall import and place replacement topsoil of comparable quality and depth.
(d) Reseeding. Reseeding of all disturbed areas with an agricultural grass seed mix, forage seed mix, or crop species appropriate to Grantor's dairy farming operations, as mutually agreed upon by the Parties. If the Parties cannot agree on the appropriate seed mix, the seed mix recommended by the Washington State University Whatcom County Extension Office for dairy pasture establishment in Whatcom County shall be used. Grantee shall apply seed, fertilizer, and soil amendments at rates recommended for the selected seed mix and shall be responsible for one cycle of reseeding if the initial seeding fails to achieve adequate establishment within one growing season.
(e) Removal of Debris and Materials. Removal of all construction debris, excess spoil, unused materials, temporary structures, temporary fencing, construction signage, and temporary facilities from the Burdened Property within thirty (30) days following completion of the relevant activity.
(f) Repair or Replacement of Damaged Improvements. Repair or replacement, at Grantee's sole cost and expense, of any fencing (including permanent and temporary agricultural fencing), irrigation systems, drainage tiles, culverts, farm roads, access lanes, and other agricultural improvements or infrastructure on the Burdened Property that are damaged, displaced, or removed as a result of Grantee's exercise of the Permitted Activities. Repairs and replacements shall be of materials and workmanship at least equal in quality to the original improvements.
8.2 Timeline for Restoration. Surface restoration shall be completed within ninety (90) calendar days following the completion of the relevant construction, maintenance, repair, or replacement activity, weather and soil conditions permitting. If weather conditions, saturated soil conditions, or other seasonal factors prevent the timely completion of restoration within the ninety-day period, Grantee shall complete restoration as soon as practicable during the next available growing season or dry-weather period. Grantee shall notify Grantor in writing if restoration cannot be completed within the ninety-day period, specifying the reason for the delay and the anticipated completion date.
8.3 Crop Damage Compensation. Grantee shall compensate Grantor for any documented crop damage, loss of forage, loss of pasture productivity, or other loss of agricultural productivity suffered by Grantor as a direct result of Grantee's exercise of the Permitted Activities, including but not limited to the loss of dairy pasture during the Temporary Construction Period and subsequent restoration periods. Crop damage compensation shall be valued at the fair market value of the affected crop type or forage based on current market prices at the time of the loss, taking into account the estimated yield of the affected area and any mitigation measures undertaken by Grantor to reduce losses. Crop damage compensation shall be determined as follows:
(a) Grantor shall submit a written claim to Grantee within sixty (60) days following the occurrence of the damage or loss, together with reasonable documentation supporting the claim, including the type and quantity of crop or forage lost, the affected acreage, applicable market prices, and any other relevant information.
(b) Grantee shall review the claim and shall, within thirty (30) days following receipt of the claim, either approve the claim and tender payment to Grantor, or notify Grantor in writing of any dispute regarding the claim amount.
(c) If the Parties are unable to agree on the amount of crop damage compensation within thirty (30) days following Grantee's notice of dispute, the amount shall be determined by an independent agricultural appraiser or crop loss adjuster mutually selected by the Parties. If the Parties cannot agree on an independent appraiser within fifteen (15) days, each Party shall select one independent agricultural appraiser, and the two selected appraisers shall jointly select a third appraiser whose determination shall be final and binding on both Parties. The cost of the independent appraiser(s) shall be borne equally by the Parties.
8.4 Livestock Protections. During any construction, maintenance, repair, or replacement activities within the Easement Area, Grantee shall, at Grantee's sole cost and expense, install and maintain temporary fencing as necessary to prevent livestock from entering active work zones, open trenches, equipment staging areas, and other areas that may pose a risk of injury to livestock or interference with construction operations. Temporary fencing shall be of a type and construction adequate to contain the type of livestock present on the Burdened Property. Grantee shall coordinate with Grantor in advance of commencing any significant work activity to minimize disruption to Grantor's dairy operations, including, where practicable, scheduling activities outside of critical calving periods, milking periods, and periods of cattle movement between pastures. Grantee shall promptly notify Grantor of any injury to or death of livestock attributable to Grantee's activities, and Grantee shall compensate Grantor for any such injury or death at the fair market value of the affected livestock.
ARTICLE 9 — ACCESS PROVISIONS
9.1 Routine Access. For routine inspection and maintenance activities (including but not limited to visual inspection, pipeline marker inspection, cathodic protection system monitoring, air-release valve inspection, and similar non-invasive activities), Grantee shall provide Grantor with no less than forty-eight (48) hours' prior notice, which may be delivered in writing (by mail, email, or hand delivery) or orally (by telephone), before entering the Burdened Property. Grantee shall use existing farm roads and established access points as depicted on Exhibit D where practicable and shall avoid crossing active crop fields, pastures in use, and areas where livestock are present, to the extent reasonably feasible. Routine access shall be conducted during normal business hours (7:00 a.m. to 6:00 p.m., Monday through Friday) unless otherwise agreed by the Parties.
9.2 Emergency Access. In the event of a pipeline failure, leak, rupture, blockage, or other emergency condition posing an imminent threat to public health, safety, the environment, or property (including the Burdened Property), Grantee and its agents, contractors, and emergency response personnel may enter the Burdened Property and the Easement Area at any time, without prior notice, and may take such action as Grantee deems reasonably necessary to address the emergency, including excavation, repair, isolation, shutdown, or remediation. Grantee shall notify Grantor as soon as practicable following any emergency entry, and in no event later than twenty-four (24) hours following such entry, by telephone and written notice. Following resolution of the emergency, Grantee shall restore the Burdened Property and the Easement Area in accordance with the Restoration Standards set forth in Article 8.
9.3 Construction Access. During the Temporary Construction Period and during any subsequent major repair, replacement, or rehabilitation activity requiring the mobilization of heavy equipment or the establishment of a work zone, Grantee shall establish access routes in advance in consultation with Grantor, with the objective of minimizing disruption to Grantor's dairy operations and damage to the Burdened Property. Construction access routes shall follow existing farm roads and access lanes as depicted on Exhibit D to the extent practicable. If Grantee determines that additional or alternative access routes are necessary, Grantee shall notify Grantor in advance and shall use commercially reasonable efforts to select routes that avoid active pastures, crop fields, and sensitive environmental areas. Following the completion of construction, repair, or replacement activities, Grantee shall restore any damage to access routes, farm roads, drainage features, culverts, and other improvements caused by construction access to their pre-construction condition, at Grantee's sole cost and expense.
9.4 Gate and Key. If Grantee installs any locked gates, barriers, or access control devices within the Easement Area, Grantor shall be provided with keys, access codes, or other means of access to such gates, barriers, or devices. Conversely, if Grantor maintains locked gates, barriers, or access control devices on the Burdened Property that affect or control access to the Easement Area, Grantor shall provide Grantee with keys, access codes, or other means of access to such gates, barriers, or devices, and Grantor shall not change or modify such locks or access codes without providing updated keys or codes to Grantee within five (5) business days. Each Party shall exercise reasonable care to secure any locked gates after passage.
ARTICLE 10 — INDEMNIFICATION AND LIABILITY
10.1 Grantee's Indemnification. Grantee shall indemnify, defend, and hold harmless Grantor, its officers, directors, shareholders, members, employees, agents, tenants, and invitees (collectively, the "Grantor Indemnitees") from and against any and all claims, demands, actions, causes of action, damages, losses, liabilities, costs, and expenses (including reasonable attorneys' fees and costs of litigation) arising out of or related to (a) Grantee's exercise of the Permitted Activities, (b) Grantee's use of or presence on the Easement Area or the Burdened Property, (c) any act or omission of Grantee or its officers, employees, agents, or contractors in connection with this Agreement, or (d) any breach by Grantee of any representation, warranty, or obligation under this Agreement, except in each case to the extent that such claims, damages, or losses are caused by the negligence or willful misconduct of any Grantor Indemnitee.
10.2 Grantor's Indemnification. Grantor shall indemnify, defend, and hold harmless Grantee, its officers, directors, employees, agents, and contractors (collectively, the "Grantee Indemnitees") from and against any and all claims, demands, actions, causes of action, damages, losses, liabilities, costs, and expenses (including reasonable attorneys' fees and costs of litigation) arising out of or related to (a) any breach by Grantor of any representation, warranty, or obligation under this Agreement, or (b) any negligence or willful misconduct of Grantor or Grantor's officers, employees, agents, tenants, or invitees in connection with the Burdened Property or the Easement Area, except in each case to the extent that such claims, damages, or losses are caused by the negligence or willful misconduct of any Grantee Indemnitee.
10.3 Limitation on Sovereign Immunity Waiver. Nothing in this Agreement shall be construed as a waiver, in whole or in part, of Grantee's sovereign immunity, governmental immunity, or any statutory limitation on liability provided by applicable law, including without limitation the provisions of Chapter 4.92 RCW (Actions and Claims Against State) and any other applicable provisions of the Revised Code of Washington. Grantee's indemnification obligations under Section 10.1 are subject to, and shall be limited by, any applicable statutory limitations on governmental liability.
10.4 Environmental Liability. Grantee shall be solely responsible for any environmental contamination, pollution, release of hazardous substances, or other environmental condition arising from or caused by the installation, operation, maintenance, repair, replacement, or removal of the Force-Main Pipeline or any appurtenances within the Easement Area, and Grantee shall remediate any such contamination in accordance with applicable environmental laws. Grantor shall remain solely responsible for any pre-existing environmental conditions on the Burdened Property that are not caused by Grantee's activities. The Parties acknowledge that Pinnacle Geotechnical & Environmental Consulting Inc. performed a Phase I Environmental Site Assessment of the Burdened Property, dated January 22, 2025, and that such assessment identified no recognized environmental conditions (as defined in ASTM E1527-21) on the Burdened Property as of the date of the assessment. Nothing in this Section shall limit either Party's obligations or liabilities under applicable federal, state, or local environmental laws and regulations.
ARTICLE 11 — INSURANCE
11.1 Grantee's Insurance. Grantee shall maintain, or shall cause its contractors and subcontractors to maintain, during the Temporary Construction Period and during any subsequent construction, repair, replacement, or rehabilitation activity conducted within the Easement Area or on the Burdened Property, the following minimum insurance coverages:
(a) Commercial General Liability Insurance. Commercial general liability insurance (occurrence form) with limits of not less than Two Million Dollars ($2,000,000) per occurrence and Five Million Dollars ($5,000,000) in the annual aggregate, covering bodily injury, property damage, personal injury, and advertising injury. Such policy shall include coverage for completed operations, products liability, and contractual liability. Grantor and Dunlap Creek Ranch Inc. shall be named as additional insureds on such policy with respect to activities arising out of or related to this Agreement.
(b) Workers' Compensation Insurance. Workers' compensation insurance as required by the laws of the State of Washington (Title 51 RCW), covering all employees, agents, and workers engaged in activities within the Easement Area or on the Burdened Property. Employer's liability coverage shall be maintained with limits of not less than One Million Dollars ($1,000,000) per occurrence.
(c) Automobile Liability Insurance. Automobile liability insurance covering all owned, hired, and non-owned vehicles used in connection with activities within the Easement Area or on the Burdened Property, with limits of not less than One Million Dollars ($1,000,000) per occurrence for bodily injury and property damage.
11.2 Self-Insurance. Notwithstanding Section 11.1, Grantee may self-insure any or all of the coverages required by Section 11.1, in whole or in part, consistent with Grantee's status as a Washington State governmental instrumentality and its established self-insurance program. Grantee's election to self-insure shall not reduce or limit Grantee's indemnification obligations under Article 10.
11.3 Evidence of Insurance. Upon Grantor's written request, made not more than once per calendar year (or at any time following an occurrence giving rise to a claim), Grantee shall provide Grantor with certificates of insurance or other reasonable evidence of insurance coverage or self-insurance within thirty (30) days following receipt of such request.
ARTICLE 12 — REPRESENTATIONS AND WARRANTIES
12.1 Grantor Represents and Warrants. Grantor hereby represents and warrants to Grantee, as of the date of this Agreement, as follows:
(a) Organization and Good Standing. Grantor is a corporation duly organized, validly existing, and in good standing under the laws of the State of Washington, with its registration current and in compliance with the requirements of the Washington Secretary of State.
(b) Authority. Garrett Dunlap, as President and Sole Director of Dunlap Creek Ranch Inc., is duly authorized to execute, deliver, and perform this Agreement on behalf of Grantor, and to grant the Easement described herein. Maureen Dunlap, as Secretary/Treasurer of Dunlap Creek Ranch Inc., has attested to such authorization by resolution of the Board of Directors (or sole director action in lieu thereof) adopted in accordance with the corporation's articles of incorporation and bylaws.
(c) No Conflicts. The execution, delivery, and performance of this Agreement, and the grant of the Easement, do not and will not (i) violate or conflict with the articles of incorporation, bylaws, or other organizational documents of Grantor, (ii) violate, conflict with, result in a breach or default under, or give rise to a right of termination, acceleration, or modification of any agreement, instrument, mortgage, deed of trust, lease, license, order, judgment, or decree binding upon Grantor or the Burdened Property, or (iii) violate any applicable law, regulation, or order, subject in each case to existing encumbrances disclosed in the title commitment issued by Cascade Basin Title Company for the Burdened Property.
(d) Title. Grantor has good and marketable fee simple title to the Burdened Property, free and clear of all liens, encumbrances, claims, and interests except for matters of record as disclosed in the title commitment issued by Cascade Basin Title Company and approved exceptions acceptable to Grantee.
12.2 Grantee Represents and Warrants. Grantee hereby represents and warrants to Grantor, as of the date of this Agreement, as follows:
(a) Organization and Existence. Grantee is a governmental instrumentality of the State of Washington, duly created and validly existing under and pursuant to Chapter 43.99N of the Revised Code of Washington, with full power, authority, and legal capacity to own property, enter into contracts, and carry out the purposes for which it was created, including the acquisition of easements and rights-of-way for public infrastructure projects.
(b) Authority and Approval. The execution, delivery, and performance of this Agreement by Grantee, and the acceptance of the Easement, have been duly authorized by all necessary governmental action, including any required approval of the CSIA Board of Directors, CSIA Executive Director, or other governing body or officer, and no further governmental action, approval, consent, or authorization is required for the execution, delivery, or performance of this Agreement by Grantee.
ARTICLE 13 — DEFAULT AND REMEDIES
13.1 Default. A Party shall be in default under this Agreement if such Party fails to perform, observe, or comply with any material obligation, covenant, condition, or provision of this Agreement and such failure continues for a period of thirty (30) days after the non-defaulting Party delivers written notice to the defaulting Party specifying the nature of the default with reasonable particularity. Notwithstanding the foregoing, if the nature of the default is such that it cannot reasonably be cured within thirty (30) days, the defaulting Party shall not be deemed in default if the defaulting Party commences curative action within the thirty-day notice period and thereafter diligently and continuously pursues such cure to completion within a reasonable time, but in no event more than ninety (90) days following receipt of the notice of default (unless an extension is agreed to in writing by the non-defaulting Party).
13.2 Remedies. Upon the occurrence of a default that remains uncured following the expiration of the applicable cure period, the non-defaulting Party may pursue any and all remedies available at law or in equity, including but not limited to specific performance of the defaulting Party's obligations, injunctive relief (temporary, preliminary, or permanent), and recovery of monetary damages. The Parties acknowledge that damages at law may be inadequate to compensate the non-defaulting Party for a breach of this Agreement and that specific performance and injunctive relief are appropriate remedies. No remedy set forth in this Agreement is intended to be exclusive; all remedies are cumulative and are in addition to any other remedies available at law, in equity, or under any other agreement.
13.3 Attorneys' Fees. In any action, suit, arbitration, or proceeding brought to enforce any provision of this Agreement, to interpret this Agreement, or arising out of or related to a default under this Agreement, the prevailing Party shall be entitled to recover from the non-prevailing Party its reasonable attorneys' fees, costs, and expenses (including expert witness fees and costs of appeal), in addition to any other relief to which such prevailing Party may be entitled.
ARTICLE 14 — CONDEMNATION AUTHORITY PRESERVED
14.1 Nothing in this Agreement shall be construed to limit, waive, restrict, or diminish Grantee's power of eminent domain under Chapter 43.99N RCW or under any other provision of the Revised Code of Washington or applicable law. Grantee expressly reserves the right to exercise its power of eminent domain to acquire fee title, additional easement interests, or other property rights in the Burdened Property or any adjacent or nearby property if Grantee determines, in its sole discretion, that such additional interests are necessary or desirable for the Project or for any future expansion, modification, or improvement of the Project.
14.2 The Parties acknowledge and agree that this Agreement has been entered into voluntarily by both Parties and constitutes a negotiated transaction undertaken in satisfaction of Grantee's obligation to make a good-faith offer to Grantor pursuant to RCW Chapter 8.25 (Uniform Condemnation Procedures Act) prior to commencing condemnation proceedings. This Agreement is intended to document the terms upon which the Parties have agreed to establish the Easement in lieu of condemnation, and the Easement Compensation reflects the negotiated value of the easement interest, determined with reference to the appraisal described in Recital D and Section 5.1.
ARTICLE 15 — ASSIGNMENT AND SUCCESSORS
15.1 Grantee's Right to Assign. Grantee may assign, transfer, or convey its rights, interests, and obligations under this Agreement and in the Easement, in whole or in part, to any governmental entity, public utility, quasi-governmental instrumentality, or successor instrumentality of the State of Washington, without the consent of Grantor, provided that the assignee expressly assumes in writing all of Grantee's obligations under this Agreement from and after the effective date of such assignment. Grantee shall provide written notice to Grantor of any such assignment within thirty (30) days following the effective date of the assignment, together with a copy of the instrument of assignment and assumption. Upon any assignment in which the assignee assumes all of Grantee's obligations, Grantee shall be released from further liability under this Agreement arising from and after the effective date of such assignment.
15.2 Binding on Successors. This Agreement and the Easement granted herein shall run with the land and shall be binding upon and inure to the benefit of the Parties and their respective heirs, successors, personal representatives, and assigns. Any conveyance of the Burdened Property or any portion thereof by Grantor shall be subject to the Easement and the terms of this Agreement, and Grantor's successor in interest shall be bound by all of the terms, conditions, restrictions, and obligations imposed upon Grantor hereunder.
ARTICLE 16 — GENERAL PROVISIONS
16.1 Governing Law. This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Washington, without regard to conflict of laws principles.
16.2 Venue. Any action, suit, or proceeding arising under or in connection with this Agreement shall be brought exclusively in the Superior Court of the State of Washington for Whatcom County, located in Bellingham, Washington, and each Party hereby consents to the personal jurisdiction and venue of such court.
16.3 Entire Agreement. This Agreement, together with all Exhibits attached hereto and incorporated herein by reference (Exhibits A, B, C, and D), constitutes the entire agreement between the Parties with respect to the pipeline corridor easement described herein and supersedes all prior and contemporaneous negotiations, discussions, proposals, representations, understandings, and agreements, whether written or oral, between the Parties relating to the subject matter hereof.
16.4 Amendments. This Agreement may not be amended, modified, supplemented, or waived except by a written instrument executed by both Parties (or their authorized successors or assigns) and recorded with the Whatcom County Auditor. No oral modification or amendment of this Agreement shall be effective for any purpose.
16.5 Severability. If any provision of this Agreement, or the application of any provision to any Person or circumstance, is held by a court of competent jurisdiction to be invalid, illegal, or unenforceable, the remainder of this Agreement, and the application of such provision to other Persons or circumstances, shall not be affected thereby, and each remaining provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. In the event that any provision is held to be invalid, illegal, or unenforceable, the Parties shall negotiate in good faith to modify this Agreement to give effect to the original intent of the Parties as closely as possible.
16.6 Notices. All notices, requests, demands, consents, approvals, and other communications required or permitted under this Agreement shall be in writing and shall be deemed duly given and received (a) when delivered personally, (b) on the date of confirmed delivery by a nationally recognized overnight courier service (such as Severin Partners LLC, Halcyon Partners LLC, or Tarrant & Co.), (c) on the third (3rd) business day following deposit in the United States mail, sent by certified mail, return receipt requested, postage prepaid, or (d) on the date of confirmed transmission by email if followed by delivery of a hard copy by one of the methods specified in clauses (a) through (c) within three (3) business days, in each case addressed to the appropriate Party at the following addresses (or at such other address as such Party may designate by written notice to the other Party):
If to Grantor:
Dunlap Creek Ranch Inc.
Attn: Garrett Dunlap, President
18500 Guide Meridian Road Lynden, WA 98264
If to Grantee:
Cascadia State Infrastructure Authority
Attn: General Counsel (Priya Shankar-Wells)
1100 Jefferson Avenue SE, Suite 400 Olympia, WA 98501
With a copy to (which shall not constitute notice):
Calderwood & Harkness LLP
Attn: Angela Fontaine
999 Second Avenue, Suite 4200 Seattle, WA 98104
16.7 Recording. This Agreement shall be recorded in the official real property records of the Whatcom County Auditor as promptly as practicable following execution and delivery by both Parties. Grantee shall be responsible for the payment of all recording fees and any applicable transfer or excise taxes, if any. Following recording, Grantee shall provide Grantor with a conformed copy of the recorded Agreement bearing the recording information.
16.8 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures delivered by facsimile or electronic transmission (including PDF) shall be deemed original signatures for all purposes.
16.9 No Third-Party Beneficiaries. This Agreement is entered into for the sole and exclusive benefit of the Parties and their respective permitted successors and assigns. Nothing in this Agreement, whether express or implied, is intended to confer upon any person or entity other than the Parties (and their permitted successors and assigns) any rights, remedies, obligations, or liabilities of any nature whatsoever.
16.10 Waiver. The failure of either Party to enforce any provision of this Agreement, or to exercise any right or remedy hereunder, shall not constitute a waiver of such provision, right, or remedy, or of the right to enforce any provision or exercise any right or remedy in the future. No waiver of any provision, right, or remedy shall be effective unless set forth in a written instrument signed by the waiving Party. Any waiver granted shall be limited to the specific instance and shall not constitute a waiver of any other or subsequent breach, default, or occasion.
16.11 Headings. The article and section headings contained in this Agreement are for convenience of reference only and shall not be used in the interpretation or construction of any provision of this Agreement. References to articles, sections, and exhibits are to articles, sections, and exhibits of this Agreement unless otherwise specified.
16.12 Relationship to Other Easements. This Agreement is separate from and in addition to the following related agreements between Grantor and Grantee entered into in connection with the Project:
(i) The Permanent Easement Agreement between Grantor (or its affiliate) and Grantee for Pump Station No. 3 (PS-3), encumbering Whatcom County Parcel No. 380220-108400 (the "PS-3 Easement Agreement"); and
(ii) The Temporary Construction Easement Agreement between Grantor and Grantee for construction staging, laydown areas, and temporary pipeline installation activities on Grantor's parcels in connection with the Project (the "TCE Agreement").
The rights, obligations, and easement interests established by this Agreement are independent of, and shall not be affected by, the terms, conditions, expiration, or termination of the PS-3 Easement Agreement or the TCE Agreement, and vice versa. In the event of any inconsistency between this Agreement and either the PS-3 Easement Agreement or the TCE Agreement with respect to the Burdened Property, the terms of this Agreement shall control with respect to the Easement Area.
[Signature Pages Follow]
IN WITNESS WHEREOF, the Parties have executed this Permanent Pipeline Corridor Easement Agreement as of the date first set forth above.
GRANTOR
DUNLAP CREEK RANCH INC., a Washington corporation
By: ________
Name: Garrett Dunlap
Title: President and Sole Director
Date: ________
ATTEST:
By: ________
Name: Maureen Dunlap
Title: Secretary/Treasurer
GRANTEE
CASCADIA STATE INFRASTRUCTURE AUTHORITY, a Washington State governmental instrumentality
By: ________
Name: Martin R. Calloway
Title: Executive Director
Date: ________
APPROVED AS TO FORM:
By: ________
Name: Priya Shankar-Wells
Title: General Counsel
ACKNOWLEDGMENT — GRANTOR
STATE OF WASHINGTON
COUNTY OF WHATCOM
On this __ day of _____, 2025, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared Garrett Dunlap, to me known (or proved to me on the basis of satisfactory evidence) to be the President and Sole Director of Dunlap Creek Ranch Inc., the corporation that executed the within and foregoing instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said corporation, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute the said instrument on behalf of the corporation.
WITNESS my hand and official seal hereto affixed the day and year in this certificate first above written.
________________________________________
Notary Public in and for the State of Washington
Printed Name: ________
Residing at: ________ My commission expires: ________
ACKNOWLEDGMENT — GRANTEE
STATE OF WASHINGTON
COUNTY OF THURSTON
On this __ day of _____, 2025, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared Martin R. Calloway, to me known (or proved to me on the basis of satisfactory evidence) to be the Exec

After recording, return to:

PERMANENT PIPELINE CORRIDOR EASEMENT AGREEMENT

RECITALS

GRANTOR

ATTEST:

GRANTEE

APPROVED AS TO FORM:

STATE OF WASHINGTON

COUNTY OF WHATCOM

STATE OF WASHINGTON

COUNTY OF THURSTON

Record

Parties

Dates

Amounts