PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT
MEMORANDUM
TO: Douglas Fairchild, Responsible Partner, Real Estate, Calderwood & Harkness LLP Cynthia Ho, Lead Associate, Real Estate, Calderwood & Harkness LLP
FROM: Grace Nakamura, Working Associate, Real Estate, Calderwood & Harkness LLP
DATE: Draft — prepared in advance of June 1, 2025 Phase I completion target
RE: Environmental Due Diligence Summary — Meridian Parcel (19.4 Acres), Loudoun County, Virginia; Loudoun County Tax Map Ref. /95-4A-2///
MATTER NO.: 1043-00002
CLIENT: Ironhaven Data Centers LLC
This memorandum constitutes attorney work product prepared in anticipation of litigation and is protected by the attorney-client privilege and the work product doctrine. This document is intended solely for the use of the attorneys and professionals of Calderwood & Harkness LLP and the client, Ironhaven Data Centers LLC. Any dissemination, distribution, or copying of this memorandum without prior written authorization is strictly prohibited. Nothing contained herein constitutes legal advice to any person or entity other than the client identified above.
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I. Executive Summary
This memorandum summarizes the preliminary findings and anticipated conclusions of the Phase I Environmental Site Assessment ("Phase I ESA") being conducted by Pendleton Environmental Associates, Inc. ("Pendleton") for the approximately 19.4-acre parcel identified as Loudoun County Tax Map Reference /95-4A-2/// (the "Meridian Parcel" or the "Property"), located in the Ashburn area of Loudoun County, Virginia 20148. The Phase I ESA is being performed in connection with Ironhaven Data Centers LLC's ("IHDC") proposed acquisition of the Meridian Parcel from Meridian Acres LLC ("Meridian" or "Seller"), managed by its Managing Member, Theodore Ashford.
The acquisition of the Meridian Parcel constitutes a critical component of IHDC's broader Stonebridge Data Center Campus development plan (the "Campus" or the "Stonebridge Campus"), which encompasses a combined total of approximately 81.4 acres—consisting of the 62.0-acre Stonebridge Parcel to the west and the 19.4-acre Meridian Parcel to the east. The Meridian Parcel is intended to accommodate utility routing corridors, a dedicated 230kV/34.5kV substation easement to be granted in favor of Vantage Power Cooperative ("VPC"), and additional building pads to support future data center construction as part of the Campus build-out.
The acquisition is governed by that certain Purchase and Sale Agreement dated April 22, 2025 (the "Meridian PSA" or "PSA"), between Meridian Acres LLC, as seller, and IHDC, as buyer. The agreed-upon purchase price for the Meridian Parcel is Nineteen Million Four Hundred Thousand Dollars ($19,400,000), reflecting a per-acre price of approximately One Million Dollars ($1,000,000). The PSA provides for a due diligence period of seventy-five (75) days from execution, resulting in a due diligence expiration date of July 7, 2025. Completion of the Phase I ESA within this period is essential to preserve IHDC's contractual rights with respect to environmental conditions affecting the Property.
The Phase I ESA is being performed by Pendleton under the direction of Dr. Renata Volkov, a licensed environmental scientist with extensive experience in Phase I and Phase II assessments in the Northern Virginia data center corridor. The target completion date for the Phase I ESA report is June 1, 2025. Pendleton was retained by IHDC through this firm to ensure that the assessment is performed in accordance with ASTM Standard E1527-21 and the U.S. Environmental Protection Agency's ("EPA") All Appropriate Inquiries Rule (40 CFR Part 312), and to support the "innocent landowner," "contiguous property owner," and "bona fide prospective purchaser" defenses under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA").
Preliminary Conclusion: Based on the work completed to date by Pendleton—including records review, historical use analysis, site reconnaissance, and stakeholder interviews—no Recognized Environmental Conditions ("RECs"), Controlled Recognized Environmental Conditions ("CRECs"), or Historical Recognized Environmental Conditions ("HRECs") have been identified on the Meridian Parcel itself. Several de minimis conditions have been noted, as described in Section VIII.D below, none of which rise to the level of a REC under ASTM E1527-21. However, an off-site concern exists with respect to potential residual pesticide contamination in the northwest quadrant (approximately 4.2 acres) of the adjacent Stonebridge Parcel, which is the subject of a separate Phase II ESA currently underway with a target completion date of July 1, 2025. Based on the preliminary evaluation of hydrogeological conditions and topographic gradients, the risk of contaminant migration from the Stonebridge Parcel to the Meridian Parcel appears to be low, but this assessment cannot be finalized until the Stonebridge Parcel Phase II ESA results are available.
At this time, a Phase II Environmental Site Assessment for the Meridian Parcel itself does not appear to be warranted. However, as discussed in greater detail in Sections IX and X below, we recommend monitoring the results of the adjacent Stonebridge Parcel Phase II ESA and completing a cross-parcel migration evaluation before finalizing environmental conclusions for the Meridian Parcel and prior to the expiration of the due diligence period on July 7, 2025.
II. Scope and Methodology
A. Engagement and Standards
Pendleton Environmental Associates, Inc. was retained by IHDC, through Calderwood & Harkness LLP, pursuant to a professional services engagement letter dated April 28, 2025, to perform a Phase I Environmental Site Assessment of the Meridian Parcel. The engagement was structured to ensure that the Phase I ESA satisfies both the transactional due diligence requirements of the Meridian PSA and the environmental due diligence standards required by Summit National Bank, N.A. ("Summit"), in its capacity as Administrative Agent for the lending syndicate providing the construction financing for the Stonebridge Data Center Campus.
The Phase I ESA is being conducted in strict accordance with ASTM International Standard E1527-21, titled "Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process," which is the current standard of care for environmental site assessments in the United States. ASTM E1527-21 replaced the prior ASTM E1527-13 standard and incorporates updated guidance regarding, among other things, the evaluation of vapor migration pathways and the identification of emerging contaminants of concern.
In addition to compliance with ASTM E1527-21, the Phase I ESA is being conducted in accordance with the EPA's All Appropriate Inquiries Final Rule, codified at 40 CFR Part 312, as amended. Compliance with the AAI Rule is a statutory prerequisite for establishing the following affirmative defenses under CERCLA (42 U.S.C. § 9601 et seq.):
(i) The "innocent landowner" defense under CERCLA § 101(35)(A);
(ii) The "contiguous property owner" defense under CERCLA § 107(q); and
(iii) The "bona fide prospective purchaser" defense under CERCLA § 107(r).
Establishment of one or more of these defenses is essential to IHDC's risk management strategy with respect to the acquisition and development of the Meridian Parcel. In particular, the "bona fide prospective purchaser" defense is the primary target defense, as IHDC is acquiring the Property with knowledge that the adjacent Stonebridge Parcel may have environmental conditions that could, under certain circumstances, affect the Meridian Parcel.
The Phase I ESA is further intended to satisfy the environmental due diligence requirements imposed by Summit National Bank, N.A. and the lending syndicate in connection with the construction loan facility for the Stonebridge Data Center Campus. The term sheet and preliminary commitment letter from Summit require delivery of a Phase I ESA conforming to ASTM E1527-21 standards for each parcel comprising the Campus, together with a Phase II ESA for any parcel where RECs are identified. The lending syndicate's environmental counsel, Redmond & Calloway LLP (Victor Redmond), has confirmed that the Phase I ESA prepared by Pendleton will be acceptable for purposes of the construction loan closing, provided that Pendleton issues a reliance letter extending the benefit of the report to Summit and the lending syndicate.
B. Components of Assessment
The Phase I ESA for the Meridian Parcel encompasses the following principal components, each of which is being performed in accordance with the requirements of ASTM E1527-21:
1. Environmental Records Review. Pendleton engaged a nationally recognized environmental database search firm to conduct a comprehensive review of federal, state, tribal, and local environmental databases covering the Property and surrounding areas within the ASTM-prescribed minimum search distances. The databases searched include, without limitation, the EPA National Priorities List (NPL/Superfund), the CERCLIS/SEMS database, RCRA generator and corrective action databases, the Emergency Response Notification System (ERNS), the Virginia Department of Environmental Quality ("DEQ") databases (including voluntary remediation program sites, underground storage tank and leaking underground storage tank registrations, solid waste management facilities, and pollution abatement permits), and Loudoun County local records. The specific results of the database searches are discussed in Section V of this memorandum.
2. Historical Use Review. Pendleton conducted a review of historical sources to identify past uses of the Property and surrounding area that may have involved the use, generation, treatment, storage, or disposal of hazardous substances or petroleum products. Historical sources reviewed include aerial photographs dating from the earliest available imagery (approximately 1937) through the present, historical USGS topographic map editions, Trelwick fire insurance maps (to the extent available), and city/business directory listings. The results of the historical use analysis are presented in Section IV.
3. Site Reconnaissance. Pendleton's field team, under the direction of Dr. Renata Volkov, conducted a visual inspection of the Property and accessible portions of adjoining properties. The site reconnaissance included observation of surface conditions, evidence of hazardous substance use or storage, the presence or absence of storage tanks (above-ground and underground), transformers and other potential PCB-containing equipment, wells, septic systems, drainage features, distressed vegetation, and evidence of fill material or dumping. The site reconnaissance observations are summarized in Section VI.
4. Interviews. Pendleton conducted interviews with the current property owner, Theodore Ashford (Managing Member, Meridian Acres LLC), as well as representatives of relevant local government agencies and other knowledgeable parties. The purpose of the interviews was to obtain information regarding historical property uses, past environmental incidents, prior environmental assessments, and current knowledge of environmental conditions on or near the Property. Interview summaries are provided in Section VII.
5. Evaluation of Physical Setting. Pendleton evaluated the physical setting of the Property, including topography, geology, soil types, surface hydrology, and groundwater conditions. This evaluation draws upon publicly available data as well as preliminary subsurface information obtained from Brannigan Geotechnical Engineering, LLC ("Brannigan"), which is concurrently performing geotechnical borings on the Meridian Parcel. The physical setting evaluation is discussed in Section III.B.
6. Report Preparation and Professional Opinion. Following completion of the foregoing assessment activities, Pendleton will issue a Phase I ESA report containing its findings, conclusions, and professional opinion regarding the identification of RECs, CRECs, and HRECs, together with recommendations for additional investigation if warranted.
C. Limitations and Data Gaps
In accordance with ASTM E1527-21, Pendleton has identified and evaluated the following data gaps encountered during the course of the Phase I ESA:
1. Limited Historical Records (Pre-1937). Aerial photographs for the Property and surrounding area are not available prior to approximately 1937. Similarly, historical land use records for the period before the mid-twentieth century are sparse for this portion of Loudoun County. While the absence of pre-1937 records represents a technical data gap, Pendleton has determined that this gap is not significant with respect to the conclusions of the assessment, as the property was situated in a rural agricultural area during this period and there is no indication of industrial or commercial activity prior to the availability of photographic records.
2. Absence of Trelwick Fire Insurance Maps. Trelwick fire insurance maps are not available for this rural Loudoun County location. Trelwick maps were historically prepared for urbanized and commercially developed areas and were not typically prepared for agricultural and rural properties. This data gap is not considered significant because the property's rural and agricultural character is well documented through other historical sources, including aerial photographs and topographic maps.
3. Limited Access to Certain Adjacent Properties. During the site reconnaissance, Pendleton was unable to obtain access to the interior of a single-family residential property located to the northeast of the Meridian Parcel. Observations of this adjacent property were limited to visual inspection from the Meridian Parcel boundary and from public rights-of-way. Pendleton does not consider this limited access to represent a significant data gap, as there are no indications from database searches, historical records, or visual observation that this residential property presents environmental conditions of concern.
4. Ongoing Geotechnical Investigation. The geotechnical borings being performed by Brannigan Geotechnical Engineering, LLC on the Meridian Parcel were not yet complete at the time of Pendleton's site reconnaissance. As the Brannigan investigation progresses, subsurface observations from the geotechnical borings may provide additional data relevant to the environmental assessment, particularly regarding the presence or absence of fill material, evidence of buried waste, or unusual subsurface conditions. Pendleton has recommended that its field team be given the opportunity to observe geotechnical boring activities and review boring logs as they become available.
Phase I ESA Scope Limitation. As required by ASTM E1527-21, it must be noted that a Phase I ESA does not include the collection or analysis of samples of soil, groundwater, surface water, air, or building materials. The Phase I assessment is a non-invasive evaluation based on records review, historical analysis, site observation, and interviews. If conditions are identified that warrant further investigation, a Phase II ESA involving sampling and laboratory analysis would be recommended as a separate engagement.
III. Property Description
A. Location and Legal Description
The Meridian Parcel is a 19.4-acre tract of land located in the Ashburn area of eastern Loudoun County, Virginia. The Property is identified on the Loudoun County Tax Map as Reference Number /95-4A-2///. The Property's mailing address and general location place it within the Ashburn, Virginia 20148 postal area. The Meridian Parcel is situated adjacent to and immediately east of the Stonebridge Parcel (Loudoun County Tax Map Ref. /95-4A-1///), a 62.0-acre tract currently owned by Blackthorn Realty Group, Inc. and also subject to acquisition by IHDC at a purchase price of $58,500,000. Together, the Meridian Parcel and the Stonebridge Parcel will constitute the Stonebridge Data Center Campus, encompassing a combined total of approximately 81.4 acres.
The Property is currently owned by Meridian Acres LLC, a Virginia limited liability company managed by Theodore Ashford as its sole Managing Member. The registered office and principal business address of Meridian Acres LLC is 3401 Old Ox Road, Sterling, Virginia 20166. Meridian Acres LLC's federal Employer Identification Number is 84-6120983. Meridian Acres LLC is represented in the transaction by Dunleavy & Dunmore Benefits Consulting, PLLC (Fiona Dunleavy).
The Property is currently zoned PD-IP (Planned Development – Industrial Park) under the Loudoun County Revised 1993 Zoning Ordinance, as amended. A Zoning Modification ("ZMOD") application, expected to be assigned Docket No. ZMOD-2025-0038, is anticipated to be filed on or before May 30, 2025, to obtain the zoning approvals necessary to permit data center use on the Property as part of the integrated Stonebridge Data Center Campus development.
B. Physical Setting
Topography. The Meridian Parcel is characterized by generally flat to gently rolling terrain, consistent with the physiographic characteristics of western Loudoun County within the Piedmont province of Virginia. Elevations across the Property range from approximately 310 feet to 325 feet above mean sea level (AMSL), with a slight gradient sloping from the northeast to the southwest. The modest topographic relief is typical of the agricultural landscapes that have historically dominated this portion of Loudoun County prior to the rapid suburbanization and data center development of the early twenty-first century.
Geology and Soils. The Property is situated within the Culpeper Basin, a Triassic-Jurassic rift basin underlain by sedimentary rocks including siltstone, sandstone, and shale of the Bull Run Formation. Surficial soils are derived from the weathering of these parent materials and are generally classified as fine-grained residual soils with moderate plasticity. Brannigan Geotechnical Engineering, LLC (Neil Brannigan, PE), which is currently performing geotechnical borings and laboratory testing on the Meridian Parcel, is expected to provide a detailed characterization of subsurface soil conditions, including bearing capacity, compressibility, and permeability parameters relevant to foundation design for the proposed substation and building pad improvements. Preliminary observations from early-stage borings suggest the presence of silty clay and weathered rock at relatively shallow depths, consistent with regional expectations. The U.S. Department of Agriculture Natural Resources Conservation Service (NRCS) Web Soil Survey identifies the predominant soil types on the Property as Penn silt loam (PeB, 2 to 7 percent slopes) and Penn-Bucks silt loam (PbB, 2 to 7 percent slopes), both of which are well-drained to moderately well-drained soils commonly found in the Triassic Lowlands of Northern Virginia.
Hydrology. No perennial streams or water bodies were identified on the Meridian Parcel during the site reconnaissance or through review of USGS topographic maps and National Wetlands Inventory data. A minor ephemeral drainage swale traverses the southwestern corner of the Property, conveying surface runoff during storm events generally in a southwesterly direction toward a tributary of Broad Run, located approximately 1.2 miles to the southwest. Review of the FEMA Flood Insurance Rate Maps (FIRM) for Loudoun County indicates that the entirety of the Meridian Parcel lies within FEMA Zone X (areas of minimal flood hazard), outside of the 100-year and 500-year floodplain boundaries. No wetlands were identified on the Property based on review of the National Wetlands Inventory; however, a formal wetland delineation may be required as part of the site development permitting process and should be coordinated with Lumen Ridge Engineering, PLLC.
Groundwater. Based on available regional data and information obtained from the Virginia Department of Environmental Quality's Groundwater Characterization Program, depth to groundwater beneath the Meridian Parcel is estimated at approximately 25 to 40 feet below ground surface (bgs). Groundwater flow in this area is generally controlled by the regional topographic gradient and fractured bedrock flow paths, with an inferred flow direction to the south-southwest, consistent with the surface topographic gradient. The underlying Triassic sedimentary aquifer system in this area is characterized by relatively low transmissivity and moderate yields, and is not designated as a sole-source aquifer under the Safe Drinking Water Act. Specific groundwater depth and flow direction data for the Property may be refined through the Brannigan geotechnical investigation, which includes water level measurements in select borings.
C. Current Use and Improvements
The Meridian Parcel is currently undeveloped land with no active agricultural or commercial operations. The Property was historically used for agricultural purposes, primarily hay production and periodic cattle grazing, but active agricultural use ceased approximately eight to ten years ago based on information provided by Theodore Ashford during the property owner interview. At the time of the site reconnaissance, the Property consisted predominantly of fallow open fields with native grasses and scattered volunteer vegetation, bordered by mature tree lines along portions of the northern and eastern boundaries.
No permanent structures or buildings are present on the Property. The following site features were noted during the site reconnaissance:
• A gravel farm access road entering the Property from a rural secondary road along the northern boundary, extending approximately 400 feet into the interior of the parcel before terminating.
• A decommissioned hand-dug well located in the northeastern quadrant of the Property, approximately 150 feet south of the northern boundary. The well is capped with a concrete slab and is not in active use. According to Theodore Ashford, the well was historically used for limited agricultural irrigation purposes and has not been operational for at least fifteen years.
• No evidence of active or abandoned septic systems was observed on the Property, although Mr. Ashford indicated that a septic system may have served a former tenant house that was demolished in the early 1990s. The approximate location of the former tenant house is in the northeastern quadrant of the Property, in the vicinity of the decommissioned well.
• No active utility connections (water, sewer, natural gas, electric) were observed serving the Property, aside from overhead electric distribution lines traversing the eastern boundary of the Property in a north-south orientation.
• A barbed-wire perimeter fence in varying states of repair surrounds portions of the Property, particularly along the northern and eastern boundaries.
No current tenants, lessees, or occupants were identified on the Property.
D. Surrounding Properties
The land uses surrounding the Meridian Parcel are summarized as follows:
North: The Property is bounded to the north by a mix of low-density residential properties and undeveloped wooded parcels. A two-lane rural secondary road provides access along the northern frontage. No commercial, industrial, or known environmentally sensitive land uses were identified immediately to the north.
South: The southern boundary of the Property abuts additional undeveloped and agricultural parcels, several of which are identified in the Loudoun County Comprehensive Plan as being within areas designated for future data center and technology-related development. No active industrial operations or known environmental concerns were identified to the south during the records review or site reconnaissance.
East: To the east, the Property is bordered by a mix of agricultural land and low-density residential lots, with overhead power transmission lines traversing several of the adjacent parcels in a north-south alignment. The residential property immediately to the northeast is the parcel to which Pendleton's field team was unable to obtain access during the site reconnaissance, as noted in Section II.C above. No environmental concerns associated with the eastern adjacent properties were identified in the environmental database searches.
West: The western boundary of the Meridian Parcel is contiguous with the Stonebridge Parcel, a 62.0-acre tract currently owned by Blackthorn Realty Group, Inc. and subject to acquisition by IHDC at a purchase price of $58,500,000 pursuant to a separate Purchase and Sale Agreement. The Stonebridge Parcel has been the subject of its own Phase I ESA by Pendleton, which identified a potential REC associated with residual pesticide contamination in the northwest quadrant of the Stonebridge Parcel (approximately 4.2 acres). A Phase II ESA for the Stonebridge Parcel is currently underway, with a target completion date of July 1, 2025. The potential for cross-parcel migration from the Stonebridge Parcel to the Meridian Parcel is addressed in detail in Sections VI.B, VIII.F, and IX of this memorandum.
No surrounding properties within the ASTM-prescribed minimum search distances were identified as listed sites on the EPA National Priorities List, the CERCLIS/SEMS database, or the Virginia DEQ Voluntary Remediation Program database. No active or formerly active gas stations, dry cleaners, auto repair facilities, or other common environmental concern operations were identified in the immediate vicinity of the Property.
IV. Historical Use Analysis
A. Aerial Photograph Review
Pendleton conducted a chronological review of aerial photographs covering the Meridian Parcel and surrounding area, utilizing historical aerial imagery obtained from the U.S. Geological Survey, the National Archives, Loudoun County GIS records, and commercial historical aerial photograph providers. Aerial photographs were reviewed for the following approximate date ranges:
1937 (earliest available): The Property and surrounding area appear as open agricultural land, consistent with rural farming operations in western Loudoun County during this period. No structures, roads (other than unpaved farm roads), or evidence of industrial or commercial activity are visible on or adjacent to the Property.
1953: The Property continues to appear as open farmland. A small structure (consistent with a farm tenant house or outbuilding) appears to be present in the northeastern quadrant of the Property. The surrounding area remains predominantly agricultural, with scattered farmsteads and woodlots.
1963: Conditions substantially unchanged from the 1953 imagery. The small structure in the northeastern quadrant remains visible. Agricultural field patterns suggest active cultivation or hay production.
1972: Similar conditions. No significant changes to the Property or immediate surroundings. The broader Ashburn area remains predominantly rural.
1983: The Property appears as open agricultural land with the same small structure in the northeastern quadrant. Early suburban residential development is beginning to appear approximately one to two miles to the east and southeast, consistent with the initial phases of residential growth in the Ashburn area.
1994: The small structure in the northeastern quadrant of the Property is no longer visible, consistent with Mr. Ashford's account that a tenant house was demolished in the early 1990s. The Property appears as open grassland/fallow agricultural land. Suburban residential development has expanded significantly in the surrounding area.
2002: The Property remains undeveloped open land. The surrounding area continues to experience suburban development, with visible residential subdivisions and commercial development to the east and southeast. Early data center development activity is beginning to appear in the broader Loudoun County industrial/technology corridor.
2010: The Property is unchanged. Data center and commercial development has accelerated in the broader Ashburn area, although the immediate vicinity of the Property retains its transitional agricultural/rural character.
2018: The Property remains undeveloped. The access road entering from the north is visible. The surrounding landscape has continued to develop, with multiple data center campuses visible within a several-mile radius.
2024 (most recent available): The Property remains as open, undeveloped land with no visible structures or improvements. The Stonebridge Parcel to the west is similarly undeveloped. The regional transformation from agricultural to technology-oriented land use is evident in the surrounding area.
Summary: The aerial photograph review confirms that the Meridian Parcel has been used exclusively for agricultural purposes (primarily hay production and grazing) and has remained substantially undeveloped throughout the entire period for which aerial photographs are available (1937 to present). The only structural improvement identified was a small tenant house or outbuilding in the northeastern quadrant, which was demolished in approximately the early 1990s. No evidence of industrial activity, waste disposal, underground storage tanks, or other environmentally significant uses was observed in any of the aerial photographs reviewed.
B. Historical Topographic Maps and Trelwick Maps
Pendleton reviewed the following editions of USGS 7.5-minute topographic quadrangle maps covering the Property and surrounding area:
• 1944 Leesburg Quadrangle
• 1952 Leesburg Quadrangle
• 1965 Ashburn Quadrangle (first separate coverage)
• 1970 Ashburn Quadrangle
• 1983 Ashburn Quadrangle
• 1994 Ashburn Quadrangle
• 2016 Ashburn Quadrangle (digital)
In each of the topographic map editions reviewed, the Property is depicted as open/agricultural land without significant structures, watercourses, or cultural features other than minor farm roads and the overhead utility line along the eastern boundary. No features indicative of industrial or commercial activity, quarrying, mining, or waste disposal were identified on any of the topographic maps.
As noted in Section II.C, Trelwick fire insurance maps are not available for this rural Loudoun County location. Trelwick maps were historically compiled for urbanized commercial and industrial areas and do not provide coverage for the agricultural and rural areas characteristic of western Loudoun County during the relevant historical periods. The absence of Trelwick map coverage does not constitute a significant data gap for this assessment.
C. City Directory and Other Historical Records
Pendleton searched available city and business directory records for addresses and properties corresponding to the Meridian Parcel and its immediate vicinity. Given the Property's rural location, city directory coverage is limited. No commercial or industrial business listings were identified for addresses associated with the Property in any of the directories reviewed. The surrounding area listings were consistent with residential and agricultural uses throughout the available directory periods.
With respect to the historical chain of ownership, Pendleton reviewed available land records from the Loudoun County Circuit Court Clerk's Office and information provided by Fidelitas Title & Escrow, Inc. Based on this review, the Property has been held by a succession of private landowners engaged in agricultural activities since at least the early twentieth century. Meridian Acres LLC acquired the Property in 2012 from a family trust associated with the prior long-term agricultural owners. No evidence of ownership by or association with any industrial, commercial, or government entity was identified in the chain of title records.
D. Summary of Historical Uses
Based on the comprehensive historical use analysis encompassing aerial photographs, topographic maps, directory records, and chain of title review, Pendleton has concluded that the Meridian Parcel has been used predominantly and almost exclusively for agricultural purposes (hay production and pastoral grazing) throughout its documented history. The Property has remained substantially undeveloped, with the sole structural improvement being a small tenant house or agricultural outbuilding that was present from at least the 1950s until its demolition in approximately the early 1990s. No evidence of industrial, commercial, or waste-related uses was identified during the historical use analysis. This historical use profile is consistent with a low-risk environmental characterization and does not, by itself, give rise to any RECs, CRECs, or HRECs.
V. Environmental Records Review
A. Federal Database Search
Pendleton's environmental database search firm conducted a comprehensive search of all ASTM-required federal environmental databases for the Meridian Parcel and surrounding properties within the applicable minimum search radii specified by ASTM E1527-21. The results are summarized below.
EPA National Priorities List (NPL/Superfund). The Meridian Parcel is not listed on the EPA National Priorities List, nor is it identified as a proposed or delisted NPL site. No NPL-listed sites were identified within the one-mile approximate minimum search distance from the Property.
CERCLIS/SEMS Database. The Meridian Parcel does not appear in the EPA's CERCLIS (now SEMS — Superfund Enterprise Management System) database. No CERCLIS/SEMS-listed sites were identified within the one-half-mile approximate minimum search distance from the Property.
RCRA Databases. The Meridian Parcel is not listed as a RCRA large quantity generator, small quantity generator, or conditionally exempt small quantity generator of hazardous waste. No RCRA Treatment, Storage, and Disposal (TSD) facilities or RCRA corrective action sites were identified within the one-mile or one-half-mile approximate minimum search distances, respectively, from the Property. Two small quantity generators were identified within the one-mile search radius: a commercial building maintenance company located approximately 0.8 miles to the east and an automotive service facility located approximately 0.9 miles to the southeast. Neither of these facilities has any documented violations, enforcement actions, or releases that would present an environmental concern to the Meridian Parcel.
Emergency Response Notification System (ERNS). No ERNS records were identified for the Meridian Parcel or within the applicable search radius that would indicate any reported releases of hazardous substances or petroleum products at or near the Property.
Federal Institutional Controls / Engineering Controls Registries. No federal institutional controls or engineering controls were identified for the Meridian Parcel or within the applicable search area.
B. State Database Search (Virginia DEQ)
Virginia DEQ Voluntary Remediation Program (VRP) Sites. The Meridian Parcel is not listed as a VRP site. No VRP-listed sites were identified within the one-half-mile approximate minimum search distance from the Property.
Virginia Pollution Abatement (VPA) Permits. No active or historical VPA permits were identified for the Meridian Parcel. No VPA-permitted facilities were identified in the immediate vicinity of the Property.
Underground Storage Tank (UST) and Leaking Underground Storage Tank (LUST) Databases. No registered underground storage tanks were identified on the Meridian Parcel or within the applicable search radius. No leaking underground storage tank sites were identified within the one-half-mile approximate minimum search distance. One closed LUST case was identified approximately 0.7 miles to the east, associated with a former residential heating oil tank at a private residence. The case was closed by Virginia DEQ with no further action required, and Pendleton has determined that it does not present an environmental concern to the Meridian Parcel.
Solid Waste Management Facilities. No active or closed solid waste management facilities (landfills, transfer stations, or other waste disposal facilities) were identified on the Meridian Parcel or within the one-mile approximate minimum search distance.
State Institutional Controls and Deed Restrictions. No state-imposed institutional controls or environmental deed restrictions were identified for the Meridian Parcel.
C. Local Records
Loudoun County Health Department Records. Pendleton contacted the Loudoun County Health Department to inquire about records of complaints, violations, or permits associated with the Meridian Parcel. The Health Department reported no records of environmental complaints, hazardous material incidents, or groundwater contamination investigations associated with the Property. The Health Department confirmed the existence of the decommissioned well on the Property and noted that the well would need to be properly abandoned in accordance with Virginia Department of Health regulations prior to site development.
Loudoun County Building Permits and Code Violation Records. A search of Loudoun County Department of Building and Development records revealed no building permits issued for the Meridian Parcel within the available digital record period (approximately 1990 to present), other than a demolition permit issued in 1993 for the removal of a residential structure, consistent with the demolition of the tenant house identified in the aerial photograph review. No code violations were identified for the Property.
Local Fire Department Records. Pendleton contacted the Loudoun County Fire and Rescue Department to inquire about records of hazardous material incidents or responses at or near the Meridian Parcel. No records of hazardous material incidents, fires involving hazardous substances, or emergency responses related to environmental releases were identified for the Property.
D. Summary of Records Review Findings
The comprehensive environmental records review conducted by Pendleton did not identify any records of environmental concern associated with the Meridian Parcel. The Property does not appear in any federal, state, or local environmental databases as a site of known or suspected contamination, and no active or closed environmental cleanup cases are associated with the Property.
Within the applicable ASTM-prescribed search distances, two off-site facilities of minor note were identified: (i) a RCRA small quantity generator (commercial building maintenance company) approximately 0.8 miles to the east, and (ii) a closed LUST case (former residential heating oil tank) approximately 0.7 miles to the east. Neither of these off-site facilities presents a credible environmental concern to the Meridian Parcel based on their distance, regulatory status, and the intervening hydrogeological conditions.
The environmental records review provides no basis for the identification of any RECs, CRECs, or HRECs on the Meridian Parcel.
VI. Site Reconnaissance
A. Interior and Exterior Observations
Dr. Renata Volkov and a Pendleton field geologist conducted a site reconnaissance of the Meridian Parcel on May 14, 2025. Weather conditions during the site visit were clear and dry, with temperatures in the mid-70s (°F), permitting unobstructed observation of surface conditions across the entirety of the Property. The site visit was facilitated by Theodore Ashford, who provided access to the Property through the gated entrance on the northern boundary.
The following observations were made during the site reconnaissance:
Surface Conditions. The Property consists of open fields dominated by fescue and other native grasses, with areas of volunteer successional vegetation (young eastern red cedar, Virginia pine, and mixed deciduous saplings) along the eastern and portions of the southern boundary. No evidence of stressed vegetation, discoloration, or die-off patterns that might indicate subsurface contamination or chemical releases was observed. The topsoil appeared to be natural, undisturbed residual soil consistent with the historical agricultural use of the Property.
Hazardous Substance Use or Storage. No evidence of the current or historical use, storage, generation, treatment, or disposal of hazardous substances or petroleum products was observed on the Property. No drums, containers, chemical tanks, or associated containment structures were present. No chemical odors were detected.
Surface Staining. A minor area of petroleum staining (approximately 2 feet by 3 feet in extent) was observed on exposed soil adjacent to the gravel access road, approximately 200 feet south of the northern property boundary. The staining is consistent with incidental dripping from farm equipment or vehicles and does not exhibit characteristics indicative of a significant release. This condition is classified as a de minimis condition and is discussed further in Section VIII.D.
Fill Material and Dumping. No evidence of significant fill material placement, grading operations, or waste dumping was observed on the Property. A small area in the northeastern quadrant, in the vicinity of the former tenant house location, contained a minor quantity of inert construction debris (broken concrete fragments, brick pieces) consistent with the remnants of a demolished residential structure. The volume of debris is estimated at less than two cubic yards and is limited to an area of approximately 10 feet by 15 feet. This condition is classified as a de minimis condition.
Above-Ground Storage Tanks (ASTs). No above-ground storage tanks were observed on the Property.
Underground Storage Tanks (USTs). No evidence of underground storage tanks was observed on the Property. No tank fill ports, vent pipes, or tank cradles were identified. There is no evidence from the environmental database searches, historical records, or property owner interview that USTs were ever installed on the Property.
Transformers and PCB-Containing Equipment. No transformers, capacitors, or other potential PCB-containing electrical equipment were observed on the Property. Overhead electrical distribution lines traverse the eastern boundary of the Property on utility poles, but no pole-mounted transformers were observed within the Property boundaries.
Wells. The decommissioned hand-dug well identified during the historical records review was observed in the northeastern quadrant of the Property. The well is capped with a poured concrete slab measuring approximately 3 feet by 3 feet. No evidence of recent use, leakage, or associated contamination was observed in the vicinity of the well. As noted by the Loudoun County Health Department, the well will require formal abandonment in accordance with Virginia regulations prior to site development.
Septic Systems and Dry Wells. No active septic systems, drain fields, cesspools, or dry wells were observed on the Property. Mr. Ashford indicated during the property owner interview that a septic system formerly served the demolished tenant house but that the system was likely abandoned in place at the time of demolition. No surface evidence of the former septic system (e.g., settling, depression, or exposed components) was observed, although the approximate location of the former tenant house is known and the subsurface remains of the abandoned septic system could potentially be encountered during grading operations.
Drainage Features. The minor ephemeral drainage swale in the southwestern corner of the Property was observed. The swale was dry at the time of the site visit and showed no evidence of unusual discoloration, chemical sheen, or sediment contamination. No evidence of discharge pipes, outfalls, or wastewater conveyances was observed.
B. Adjoining Property Observations
During the site reconnaissance, Dr. Volkov and the Pendleton field team made visual observations of the properties adjoining the Meridian Parcel to the extent visible from the Property boundaries and from public rights-of-way.
North. The residential and wooded properties to the north appeared to be in normal condition, with no evidence of environmental concerns observed from the Property boundary or the access road. No industrial or commercial operations, storage tanks, or chemical storage were visible.
South. The undeveloped agricultural parcels to the south appeared to be in fallow or pastoral condition, similar to the Meridian Parcel. No structures, tanks, or evidence of contamination were observed.
East. The agricultural and residential properties to the east appeared to be in normal condition. The overhead power transmission lines along the eastern boundary were observed, with no evidence of transformer oil leaks or PCB contamination in the vicinity of the utility easement.
West (Stonebridge Parcel). Pendleton's field team conducted visual observations of the Stonebridge Parcel from the western boundary of the Meridian Parcel. The Stonebridge Parcel presents a similar appearance to the Meridian Parcel—open, undeveloped agricultural land with fallow fields and scattered vegetation. The northwest quadrant of the Stonebridge Parcel (the area identified as the potential pesticide contamination zone in the Stonebridge Phase I ESA) is located approximately 800 to 1,200 feet from the nearest point on the Meridian Parcel's western boundary. No visual evidence of contamination, stressed vegetation, or surface staining was observed on the Stonebridge Parcel from the vantage point of the Meridian Parcel boundary.
Assessment of Cross-Parcel Migration Risk. With respect to the potential residual pesticide contamination identified in the northwest quadrant of the Stonebridge Parcel (approximately 4.2 acres), Pendleton has conducted a preliminary evaluation of the potential for contaminant migration to the Meridian Parcel. This evaluation considers the following factors:
(i) Distance. The area of concern on the Stonebridge Parcel is located in the northwest quadrant, approximately 800 to 1,200 feet from the nearest point on the Meridian Parcel's western boundary. This distance provides a significant buffer zone.
(ii) Topographic Gradient. The topographic gradient in the area between the Stonebridge Parcel's northwest quadrant and the Meridian Parcel's western boundary generally slopes to the south-southwest, away from the Meridian Parcel. Surface water runoff from the area of concern would be directed generally to the south and southwest rather than toward the Meridian Parcel.
(iii) Groundwater Flow Direction. The inferred groundwater flow direction in this area is to the south-southwest, consistent with the regional topographic gradient. Based on this preliminary assessment, groundwater flow from the Stonebridge Parcel's northwest quadrant would not be directed toward the Meridian Parcel.
(iv) Nature of Contaminants. Residual pesticide contamination in agricultural settings typically involves organochlorine and/or organophosphate compounds, which tend to bind to soil particles and exhibit limited mobility in the subsurface. The potential for significant lateral migration of such compounds through soil or groundwater over a distance of 800 to 1,200 feet is generally considered low, although site-specific conditions may influence this assessment.
Based on these preliminary considerations, Pendleton has indicated that the risk of contaminant migration from the Stonebridge Parcel's northwest quadrant to the Meridian Parcel appears to be low. However, Pendleton has expressly noted that this assessment is preliminary and cannot be finalized until the Stonebridge Parcel Phase II ESA results are available, including soil sampling data, groundwater analytical results, and a more detailed characterization of the nature and extent of any contamination on the Stonebridge Parcel. The Stonebridge Parcel Phase II ESA has a target completion date of July 1, 2025.
VII. Interviews
A. Property Owner Interview
Pendleton conducted an in-person interview with Theodore Ashford, Managing Member of Meridian Acres LLC, on May 12, 2025, at Mr. Ashford's office at 3401 Old Ox Road, Sterling, Virginia 20166. The interview was conducted by Dr. Renata Volkov in accordance with ASTM E1527-21 requirements for user-provided information and owner/operator interviews.
Mr. Ashford provided the following information relevant to the environmental assessment:
• Meridian Acres LLC acquired the Property in 2012 from the Rutledge Family Trust, which had owned the Property for several decades prior. The Rutledge family used the Property for agricultural purposes, primarily hay production and cattle grazing.
• During Meridian Acres LLC's ownership, the Property has not been actively farmed. The fields have been maintained through periodic mowing but have otherwise been left fallow.
• A small tenant house or farm cottage was located in the northeastern quadrant of the Property. The house was occupied by a farm tenant of the Rutledge family and was demolished in approximately 1993. Mr. Ashford is not aware of the specific circumstances of the demolition but understands that the foundation and septic system were likely left in place and covered over.
• A hand-dug well in the northeastern quadrant served the tenant house and was used for limited agricultural irrigation. The well was capped and taken out of service before Meridian Acres LLC's acquisition. Mr. Ashford does not believe the well was ever formally abandoned.
• Mr. Ashford has no knowledge of any hazardous substance use, storage, generation, treatment, or disposal on the Property during Meridian Acres LLC's ownership or during the prior Rutledge family ownership.
• Mr. Ashford is not aware of any prior environmental assessments, investigations, or remediation activities conducted on the Property.
• Mr. Ashford has no knowledge of any environmental liens, deed restrictions, or institutional controls affecting the Property.
• Mr. Ashford confirmed that agricultural chemicals (fertilizers, herbicides) were likely used on the Property during the period of active farming by the Rutledge family, but he has no specific information regarding the types, quantities, or methods of application. He noted that the agricultural operations were typical small-scale farming activities and did not involve intensive chemical use, large-scale pesticide application, or aerial spraying.
• Mr. Ashford is not aware of any underground storage tanks having been installed on the Property at any time.
• Mr. Ashford noted no knowledge of environmental conditions on neighboring properties, including the Stonebridge Parcel to the west, other than general awareness that the entire area is transitioning from agricultural to data center and commercial development.
Mr. Ashford was cooperative and forthcoming during the interview. No inconsistencies between Mr. Ashford's representations and the information gathered through other components of the Phase I ESA were identified.
B. Local Government Interviews
Pendleton contacted the following Loudoun County agencies to obtain information relevant to the environmental assessment:
Loudoun County Health Department. A representative of the Health Department confirmed no records of environmental complaints, contamination incidents, or enforcement actions associated with the Meridian Parcel. The Health Department noted the existence of the decommissioned well and reiterated the requirement for proper well abandonment prior to development, in accordance with 12 VAC 5-630 (Virginia Private Well Regulations).
Loudoun County Department of Building and Development. The Department confirmed the 1993 demolition permit for the tenant house and reported no other building permits or code violations for the Property. No records of asbestos abatement or lead paint remediation were identified in connection with the 1993 demolition, although such records may not have been required or maintained for structures of that vintage and size during that period.
Loudoun County Fire and Rescue Department. A representative confirmed no records of hazardous materials incidents, fire responses involving chemical releases, or environmental emergency responses at or near the Property.
C. Other Knowledgeable Parties
Pendleton attempted to contact the adjacent residential property owner to the northeast but was unable to reach the property owner by telephone or in person during the assessment period. No other knowledgeable parties were identified who could provide additional information regarding historical uses or environmental conditions on the Meridian Parcel. Pendleton does not consider this to represent a significant data gap.
VIII. Findings and Identified Environmental Conditions
A. Recognized Environmental Conditions (RECs)
Based on the assessment activities completed to date, no Recognized Environmental Conditions (RECs) were identified on the Meridian Parcel. A REC is defined under ASTM E1527-21 as the presence or likely presence of any hazardous substances or petroleum products in, on, or at a property: (i) due to a release to the environment; (ii) under conditions indicative of a release to the environment; or (iii) under conditions that pose a material threat of a future release to the environment. No conditions meeting this definition were identified during the records review, historical use analysis, site reconnaissance, or interviews conducted as part of the Phase I ESA.
B. Controlled Recognized Environmental Conditions (CRECs)
No Controlled Recognized Environmental Conditions (CRECs) were identified on the Meridian Parcel. A CREC is a REC resulting from a past release of hazardous substances or petroleum products that has been addressed to the satisfaction of the applicable regulatory authority, with hazardous substances or petroleum products allowed to remain in place subject to the implementation of required controls. No past releases and no regulatory controls or remediation activities were identified for the Property.
C. Historical Recognized Environmental Conditions (HRECs)
No Historical Recognized Environmental Conditions (HRECs) were identified on the Meridian Parcel. An HREC is a past release of hazardous substances or petroleum products that has occurred in connection with the property and has been addressed to the satisfaction of the applicable regulatory authority, without subjecting the property to any required controls. No past releases were identified for the Property.
D. De Minimis Conditions
The following de minimis environmental conditions were noted during the Phase I ESA. These conditions do not rise to the level of RECs under ASTM E1527-21 and are not considered to represent a material threat to human health or the environment:
1. Minor Petroleum Staining Near Access Road. A localized area of petroleum staining (approximately 2 feet by 3 feet) was observed on exposed soil adjacent to the gravel access road in the northern portion of the Property. The staining is consistent with incidental dripping from farm equipment or vehicles and does not exhibit visual characteristics of a significant release (no pooling, no stressed vegetation, no chemical odor). This condition is typical of agricultural properties where equipment has been operated and parked and does not warrant further investigation.
2. Inert Construction Debris. A minor quantity (less than two cubic yards) of inert construction debris (broken concrete and brick fragments) was observed in the northeastern quadrant of the Property, in the vicinity of the former tenant house location. The debris is consistent with remnants of the demolished residential structure and does not contain visible evidence of hazardous materials. Removal or management of this debris can be addressed during site grading as a construction management activity rather than an environmental remediation concern.
3. Decommissioned Well. The capped hand-dug well in the northeastern quadrant represents a potential pathway for surface contaminants to reach groundwater if not properly abandoned. While the well does not constitute a REC in its current capped condition, proper abandonment in accordance with Virginia Department of Health regulations (12 VAC 5-630) should be completed prior to or during site development.
4. Potential Abandoned Septic System. The potential remnants of a septic system that served the former tenant house may remain in the subsurface in the northeastern quadrant of the Property. If encountered during grading operations, the abandoned septic system should be properly decommissioned in accordance with Loudoun County Health Department requirements. The presence of a small-scale residential septic system does not constitute a REC under ASTM E1527-21.
E. Vapor Intrusion Considerations
Pendleton evaluated whether vapor intrusion screening is warranted for the Meridian Parcel based on the assessment findings. Vapor intrusion is the migration of volatile organic compounds (VOCs) or other volatile chemicals from subsurface contamination sources (contaminated soil or groundwater) through soil gas into overlying buildings.
Based on the Phase I ESA findings for the Meridian Parcel, no subsurface contamination sources (VOC releases, solvent contamination, petroleum hydrocarbon plumes) were identified on the Property or in the immediate vicinity. The environmental database searches did not identify any active or closed VOC contamination sites within the applicable search distances that could present a vapor intrusion pathway to the Meridian Parcel.
With respect to the potential residual pesticide contamination on the adjacent Stonebridge Parcel, the pesticide compounds typically associated with historical agricultural operations (organochlorines such as DDT, chlordane, and dieldrin; organophosphates such as malathion and diazinon) are generally not considered significant vapor intrusion sources, as they tend to be semi-volatile or non-volatile and exhibit low vapor pressures. However, the specific contaminants of concern on the Stonebridge Parcel have not yet been characterized, as the Stonebridge Phase II ESA is ongoing.
At this time, Pendleton has concluded that vapor intrusion screening is not warranted for the Meridian Parcel. This conclusion should be revisited upon receipt of the Stonebridge Parcel Phase II ESA results, particularly if volatile organic compounds or other volatile contaminants are identified.
F. Off-Site Concerns
The following off-site concerns were identified during the Phase I ESA:
1. Adjacent Stonebridge Parcel — Potential Residual Pesticide Contamination. As discussed in detail in Section VI.B, the Phase I ESA for the adjacent Stonebridge Parcel (62.0 acres) identified a potential REC associated with residual pesticide contamination in the northwest quadrant of that parcel (approximately 4.2 acres). The pesticide contamination is believed to be associated with intensive agricultural chemical application during the mid-twentieth century period of active farming on that portion of the Stonebridge Parcel. A Phase II ESA is currently being conducted by Pendleton (Dr. Renata Volkov) with a target completion date of July 1, 2025.
Based on Pendleton's preliminary evaluation, the risk of contaminant migration from the Stonebridge Parcel to the Meridian Parcel appears to be low, as discussed in Section VI.B above. The area of concern on the Stonebridge Parcel is situated approximately 800 to 1,200 feet from the Meridian Parcel boundary, topographic and groundwater gradients are directed away from the Meridian Parcel, and the pesticide compounds typically associated with agricultural operations exhibit limited subsurface mobility. However, this assessment remains preliminary pending the Stonebridge Phase II ESA results.
2. Other Off-Site Facilities. The two off-site facilities identified in the environmental database searches (a RCRA small quantity generator