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Ordinance 22-022 Yellowstone Franchise CITY OF SPOKANE VALLEY SPOKANE COUNTY, WASHINGTON ORDINANCE NO.21-022 AN ORDINANCE OF THE CITY OF SPOKANE VALLEY,SPOKANE COUNTY, WASHINGTON,GRANTING A NON-EXCLUSIVE FRANCHISE TO THE:YELLOWSTONE PIPE LINE COMPANY TO CONSTRUCT,OPERATE,MAINTAIN,REMOVE,REPLACE, AND REPAIR EXISTING PIPELINE FACILITIES FOR THE TRANSPORTATION OF PETROLEUM PRODUCTS AND BYPRODUCTS WITHIN AND THROUGH THE CITY OF SPOKANE VALLEY,AND OTHER MATTERS RELATING THERETO. WHEREAS, Yellowstone Pipe Line Company (hereinafter "Yellowstone") has applied for a nonexclusive franchise to operate and maintain a petroleum pipeline within and through the City of Spokane Valley(hereinafter("City" or"the City"); and WHEREAS, RCW 35A.47.040 authorizes the City to grant, permit, and regulate "nonexclusive franchises for the use of public streets, bridges or other public ways, structures or places above or below the surface of the ground for railroads and other routes and facilities for public conveyances, for poles, conduits, tunnels, towers and structures, pipes and wires and appurtenances thereof for transmission and distribution of electrical energy, signals and other methods of communication, for gas, steam and liquid fuels, for water,sewer and other private and publicly owned and operated facilities for public service;"and WHEREAS, RCW 35A.47.040 further requires that "no ordinance or resolution granting any franchise in a code city for any purpose shall be adopted or passed by the city's legislative body on the day of its introduction nor for five days thereafter,nor at any other than a regular meeting nor without first being submitted to the city attorney,nor without having been granted by the approving vote of at least a majority of the entire legislative body,nor without being published at least once in a newspaper of general circulation in the city before becoming effective;"and WHEREAS,this Ordinance has been submitted to the City Attorney for review prior to its passage; and WHEREAS, the Council finds that the grant of the franchise contained in this Ordinance, subject to its terms and conditions, is in the best interests of the public, and protects the health, safety, and welfare of the citizens of this City. NOW, THEREFORE, the City Council of the City of Spokane Valley, Spokane County, Washington, ordains as follows: Section I. Definitions. For the purposes of this franchise and all exhibits attached hereto, the following terms, phrases, words and their derivations shall have the meaning given herein. When not inconsistent with the context,words used in the present tense include the future,words in the plural include the singular, and words in the singular include the plural. Words not defined shall be given their common and ordinary meaning. construct or construction-shall mean removing,replacing,and repairing existing facilities and may include, but is not limited to, digging and/or excavating for the purposes of removing, replacing, and repairing existing facilities, Yellowstone Pipe Line Franchise Ordinance 21-022 Page 1 of 16 effective date - shall mean the date designated herein after passage, approval and legal publication of this Ordinance and acceptance by Yellowstone, upon which the rights, duties and obligations shall be in effect and the date from which the time requirement for any notice, extension and/or renewal shall be measured. facilities - shall mean the Yellowstone's pipeline system, lines, valves, mains, and appurtenances used to transport or distribute Yellowstone's petroleum products. franchise-shall mean this franchise including any amendments, exhibits, or appendices. franchise area - shall mean the area within the jurisdictional boundaries of the City where Yellowstone currently has facilities in the pipeline corridor, including any areas annexed by City during the term of this franchise, in which case the annexed area shall become subject to the terms of this franchise. hazardous substance-shall mean any hazardous,toxic, or dangerous substance, material, waste, pollutant, or contaminant. The term shall specifically include petroleum and petroleum products and their by- products, residue, and remainder in whatever form or state. The term shall also be interpreted to include any substance which, after release into the environment, will or may reasonably be anticipated to cause death, disease, injury, illness, behavior abnormalities or genetic abnormalities. maintenance or maintain- shall mean examining, testing, inspecting, repairing, maintaining and replacing the existing facilities or any part thereof as required and necessary for safe operation in the franchise area. operate or operations - shall mean the use of Yellowstone's existing facilities for the transportation, distribution and handling of petroleum products or byproducts within and through the franchise area. pipeline corridor - shall mean the pipeline pathway through the franchise area in which the Yellowstone facilities are located at the time this franchise becomes effective, including any rights-of-way,public places located in the City as approved under City permits issued pursuant to this franchise, and/or easement over and through private property. public properties - shall mean the present and/or future property owned or leased by the City within the present and/or future corporate limits or jurisdictional boundaries of the City. rights-of-way-shall mean the surface and the space above and below streets,roadways,highways,avenues, courts, lanes, alleys, sidewalks, and easements located in the franchise area. Section 2. Grant of Franchise. 2.1 City hereby grants to Yellowstone, a corporation organized and existing under and by virtue of the laws of the State of Delaware, and which is authorized to transact business within the State of Washington, its successors and assigns (as provided in Section 4), the right, privilege, authority and franchise to construct, operate and maintain its existing facilities necessary for the transportation, distribution and handling of any petroleum product or byproduct thereof, liquids and gases, on public rights-of-way and stormwater properties within the existing pipeline corridor passing through the franchise area. 2.2 This franchise is non-exclusive. City reserves all rights to its property, including, without limitation, the right to grant additional franchises, easements, licenses and permits to others, provided that the City shall not grant any other franchise, license, easement or permit that would unreasonably interfere with Yellowstone's permitted use under this franchise. This franchise shall in no manner prohibit the City or limit its power to perform work upon its rights-of-way and public properties, or make any necessary changes, relocation, repair, maintenance, establishment, improvement thereto, or from using any of the Yellowstone Pipe Line Franchise Ordinance 21-022 Page 2 of 16 rights-of way and public properties, or any part of them, as the City may deem fit from time-to-time, including the dedication, establishment,maintenance and improvement of all new rights-of-way and other public properties of every type and description. 2.3 This franchise is conditioned upon the terms and conditions contained herein and Yellowstone's compliance with all applicable federal, state or other regulatory programs that currently exist or may hereafter be enacted by any regulatory agencies with jurisdiction over Yellowstone and that are applicable to the facilities in the franchise area. 2.4 By granting this franchise, the City is not assuming any risks or liabilities. Yellowstone agrees and covenants to, at its sole cost and expense,take all necessary and prudent steps to protect, support,and keep safe from harm its facilities, or any part thereof, when necessary to protect the public health and safety. 2.5 This franchise is intended to convey only a limited right and interest, It is not a warranty of title or interest in City's rights-of way or other public property. None of the rights granted herein shall affect the City's jurisdiction over its property, streets or rights-of-way. 2,6 This franchise does not and shall not convey any right to Yellowstone to install its facilities on, under, over, across, or to otherwise use City-owned or leased properties of any kind, either within or outside the pipeline corridor, other than existing public rights-of-way except with express written permission by the City. 2.7 The limited rights and privileges granted under this franchise shall not convey any right to Yellowstone to install any new facilities without the express written consent of City. 2.8 The parties acknowledge that Yellowstone has facilities on private property and Interstate 90 (I-90) within the City limits, in addition to those on publicly-owned rights-of-way that are subject to this franchise, and that the terms of this franchise do not apply to those facilities located on private property or within the I-90 corridor. A route map of Yellowstone's facilities, including whether located on private or public property, is attached as Exhibit 1. Section 3. Term. Each of the provisions of this franchise shall become effective upon the effective date, subject to Yellowstone's acceptance of the terms and conditions of this franchise and shall remain in effect for 25 years thereafter. Subsequently, City Council may consider renewing this franchise, at the written request of Yellowstone, for an additional 25-year renewal period at any time within two years before the end of the franchise's original 25-year term,unless either party expresses its intention in writing to terminate this franchise at the conclusion of the original year term. Any request for renewal by Yellowstone shall be at least six months before expiration of this franchise. Section 4. Assignment and Transfer of Franchise. 4.1 This franchise shall not be leased, assigned, or otherwise alienated without the express consent of the City by ordinance, which approval shall not be unreasonably withheld. 4.2 No transfer shall be approved unless the assignee or transferee has at least the legal,technical,financial, and other requisite qualifications to carry on the activities of Yellowstone with respect to this franchise. 4.3 Any transfer or assignment of this franchise without the prior written consent of the City shall be void. Section 5. Compliance with Laws and Standards. Yellowstone Pipe Line Franchise Ordinance 21-022 Page 3 of 16 5.1 In carrying out any authorized activities under the privileges granted herein, Yellowstone shall meet accepted industry standards and comply with all applicable laws of any governmental entity with jurisdiction over the pipeline and its operation. This shall include all applicable laws,rules and regulations existing at the effective date of this franchise or that may be subsequently enacted by any governmental entity with jurisdiction over Yellowstone facilities. 5.2 In the case of any conflict between the terms of this franchise and the terms of City's ordinances, codes, regulations, standards and procedures, this franchise shall govern. Section 6. Construction and Maintenance. 6.1 All pipeline construction, maintenance or operation undertaken by Yellowstone, upon Yellowstone's direction or on Yellowstone's behalf, shall be completed in a workmanlike manner and comply with all applicable state and federal regulations. 6.2 Except in the case of an emergency,prior to commencing any construction and/or maintenance work in the franchise area,Yellowstone shall first file with the City such detailed plans, specifications,and profiles of the intended work as may be required by the City. The City may require such additional information, plans, and/or specifications as are in the City's reasonable opinion necessary to protect the public health and safety during the construction and/or maintenance work and for the remaining term of this franchise. 6.3 All construction and/or maintenance work shall be performed in substantial conformity with the plans, maps, and specifications filed with the City, except in instances in which deviation may be allowed thereafter in writing pursuant to an application by Yellowstone, or in instances of emergency, which shall then be brought into conformity within a reasonable time. 6.4 All pipes and other components of any facilities used in construction and/or maintenance activities within the franchise area shall comply with applicable federal regulations as adopted or amended. 6.5 Except in the event of an emergency, Yellowstone shall provide the City at least 20 calendar days written notice prior to any construction and/or maintenance,or other substantial activity, other than routine inspections and maintenance, by Yellowstone, its agents, employees or contractors on YeIlowstone's facilities within the franchise area. 6.6 Work shall only commence upon the issuance of applicable permits by the City, which permits shall not be unreasonably withheld or delayed. However, in the event of an emergency requiring immediate action by Yellowstone for the protection of its facilities, the City's property or other persons or property, Yellowstone may proceed without first obtaining the normally required permits. In such event Yellowstone shall: 6.6.1 Take all necessary and prudent steps to protect,support,and keep safe from harm its facilities, or any part thereof;the City's property;or other persons or property,and to protect the public health and safety;and 6.6.2 Obtain the required permits as soon as reasonably possible, and comply with any mitigation requirements or other conditions in the after-the-fact permit. 6.7 Unless such condition or regulation is in conflict with a federal requirement,the City may condition the granting of any permit or other approval that is required under this franchise, in any manner reasonably necessary for the safe use and management of the public rights-of-way or the City's property including,by way of example and not limitation, bonding,maintaining proper distance from other utilities,protecting the Yellowstone Pipe Line Franchise Ordinance 21-022 Page 4 of 16 continuity of pedestrian and vehicular traffic and protecting any improvements to the rights-of-way,private facilities, and public safety. 6.8 Whenever necessary, after constructing or maintaining any of Yellowstone's facilities within the Franchise Area, Yellowstone shall, without delay, and at Yellowstone's sole expense, remove all debris and restore the surface as nearly as possible to at least as good condition as it was before the work began. Yellowstone shall replace any property corner monuments, survey reference, or hubs that were disturbed or destroyed during Yellowstone's work in the areas covered by this franchise. Such restoration shall be done in a manner consistent with applicable codes and laws, under the supervision of the City and to the City's satisfaction and specifications. The restoration shall be done under a bond in an amount appropriate to guarantee adequate restoration. 6.9 Yellowstone shall continuously be a member of the State of Washington utility locator service under RCW 19.122, and shall comply with all such applicable rules and regulations. Yellowstone shall provide reasonable notice to the City prior to commencing any maintenance or construction under this franchise and additionally to those owners or other persons in control of property in the franchise area when the maintenance or construction will affect access or otherwise impact the property. 6.10 Yellowstone shall comply with line marking requirements specified in 49 C.F.R. §195 and WAC 480- 93-124. 6.11 Upon acceptance of this franchise by Yellowstone, Yellowstone shall file and thereafter maintain at all times with the City a survey depicting the Iocation of the pipeline corridor within the franchise area as well as the approximate location of Yellowstone's facilities within the pipeline corridor along with all other known utilities, landmarks, and physical features. When the City or third parties are engaged in work in the pipeline corridor, or within 50 feet of the pipeline corridor, Yellowstone shall promptly respond to requests to locate the precise position of its facilities. If the project is a City project,Yellowstone shall bear any costs associated with locating its facilities. 6.12 Yellowstone shall provide detailed as-built design drawings showing the size, depth, and location of all pipes, valves, gauges, other service appurtenances and facilities within the franchise area, pursuant to RCW 81.88.080. It is understood that the location of the facilities shall be verified by pot-holing or other type of excavation if exact alignment is required by the City. City agrees that it shall comply with all state and federal laws prohibiting disclosure of Yellowstone's drawings, maps, etc.to any third party. 6,13 Within 30 days of completing any maintenance or construction,or any other substantial activity within the franchise area,Yellowstone shall provide updated and corrected as-built drawings and a survey showing the location, depth and other characteristics of the facilities within the franchise area. 6.14 Nothing in this franchise shall be deemed to impose any duty or obligation upon City to determine the adequacy or sufficiency of Yellowstone's plans and designs or to ascertain whether Yellowstone's proposed or actual construction,testing,maintenance,repairs,replacement, or removal is adequate or sufficient or in conformance with the plans and specifications reviewed by the City. 6.15 Yellowstone shall be solely responsible for workplace safety and safe working practices on its job sites within the franchise area, including safety of all persons and property during the performance of any work. Section 7. Operations,Maintenance,Inspection,Testing.Yellowstone shall operate,maintain, inspect,and test its facilities in the franchise area in full compliance with all federal, state and local laws, regulations and standards, as now enacted or hereafter amended, and any other future laws or regulations that are applicable to Yellowstone's facilities, products, and business operations. Yellowstone Pipe Line Franchise Ordinance 21-022 Page 5 of 16 Section 8. Encroachment Management. 8.1 Yellowstone shall comply with encroachment requirements specified in 49 C.F.R. §195. 8.2 Upon notification to Yellowstone of planned construction involving excavation or any activity by the City or a third party that could abnormally load the pipeline within 50 feet of Yellowstone's pipeline corridor, Yellowstone shall flag the precise location of its facilities before the construction or activity commences, provide a representative to inspect the construction when it commences, and periodically inspect thereafter to ensure that Yellowstone's facilities are not damaged by the construction or activity. 8.3 Upon the City's reasonable request in connection with the design of any City public work project, Yellowstone shall verify the exact location of its underground facilities within the pipeline corridor by pot- holing at no expense to the City. In the event Yellowstone performs said pot-holing, the City shall not require any restoration of the disturbed area in excess of restoration to the same condition as existed immediately prior to the excavation. Section 9. Leaks, Spills, Ruptures and Emergency Response. 9.1 Yellowstone shall establish and maintain during the term of this franchise a system for remotely monitoring pressures and flows across the franchise area. The remote monitoring shall be able to accurately detect pipeline ruptures. 9.2 During the term of this franchise, Yellowstone shall have a written emergency response plan and procedure for locating leaks, spills, and ruptures and shall provide for shutting down valves as rapidly as possible. 9.3 Upon acceptance of the franchise Agreement, Yellowstone shall provide the City online access to its emergency response plan that is updated as needed for any amendments. 9.4 Yellowstone's emergency plans and procedures shall designate Yellowstone's responsible local emergency response officials and a direct 24-hour emergency contact number for control center operator. Yellowstone shall, after being notified of an emergency, cooperate with the City and make every effort to respond as soon as possible to protect the public's health, safety,and welfare. 9.5 Yellowstone shall be solely responsible for all necessary costs incurred by City,county, special district, or state agencies in responding to any rupture, spill, or leak from Yellowstone's facilities, including, but not limited to, detection and removal of any contaminants from air, earth, or water, and all actual remediation costs. This section shall not limit Yellowstone's rights or causes of action against any third party or parties who may be responsible for a leak, spill, or other release of hazardous liquid from Yellowstone's pipeline, including such third party's insurers. This provision shall not be applicable with respect to any ruptures, spills, or leaks caused by the City's negligence. 9.6 In addition to the notification requirements in the emergency response plan, Yellowstone shall notify City of any uncontained leak,spill or rupture,outside of a vault or pump station,of petroleum product from Yellowstone's facilities within or affecting the franchise area totaling one barrel or more, within one business day of its observation or detection. 9.7 If requested by the City in writing,Yellowstone shall follow up this notice within 30 days with a written summary of the event, including,but not limited to,the leak,spill,or rupture's date,time,amount,location, response, remediation, and other agencies Yellowstone has notified. Yellowstone Pipe Line Franchise Ordinance 21-022 Page 6 of 16 9.8 In the event of an uncontained leak, spill or rupture from Yellowstone's facilities affecting the franchise area of five bagels or more, where the cause is not reasonably apparent to Yellowstone, and where federal or state regulators do not investigate, the City may demand that the occurrence be investigated by an independent pipeline consultant selected by the City, subject to approval by YPL, which approval shall not be unreasonably denied. Yellowstone shall be solely responsible for paying all of the consultant's costs and expenses incurred in investigating the occurrence and reporting the findings. Yellowstone shall meet and confer with the independent consultant following the consultant's investigation to address whether any modifications or additions to Yellowstone's facilities may be warranted. In eases where federal or state regulators do perform an investigation, Yellowstone shall share, if allowable under applicable law, the results of that investigation with the City within 60 days of Yellowstone receiving it. 9.9 If the independent pipeline consultant selected by the City as referenced in Section 9.8, above, recommends that Yellowstone make modifications or additions to Yellowstone's facilities, Yellowstone shall consider said recommendations in good faith. If Yellowstone declines to follow the consultant's recommendations, Yellowstone shall provide a written report to the City explaining its reasoning for not following said recommendations. The parties agree to comply with the dispute resolution provisions contained herein to resolve any dispute over whether to follow the consultant's recommendations. Section 10. Relocation. 10.1 In the event the City undertakes or approves the construction of or changes to the grade or location of any water, sewer, or storm drainage line, street, sidewalk, or other City improvement project or any governmental agency or any person or entity acting in a governmental capacity, or on the behalf of, under the authority of, or at the request of the City or any other governmental agency, undertakes any improvement project and the City determines that the project might reasonably require the relocation of Yellowstone's facilities, City shall provide Yellowstone at least 180 calendar days' prior written notice or such additional time as may reasonably be required, of such project requiring relocation of Yellowstone's facilities. 10.2 City shall provide Yellowstone with copies of pertinent portions of the plans and specifications for the improvement project. Upon request,Yellowstone shall,at Yellowstone's sole cost and expense, determine and identify for the City,the exact location of its facilities potentially affected by the improvement project. 10.3 Yellowstone may, after receipt of written notice requesting a relocation of its facilities, submit to the City written alternatives to the relocation within 90 calendar days or other tizneframe as otherwise mutually agreed,which agreement will not be unreasonably withheld. The City shall evaluate the alternatives and advise Yellowstone in writing if one or more of the alternatives are suitable to accommodate the work that would otherwise necessitate relocation of the facilities. If requested by the City,Yellowstone shall submit additional information to assist the City in making the evaluation. The City shall give each alternative proposed by Yellowstone full and fair consideration but retains full discretion to decide whether to utilize its original plan or an alternative proposed by Yellowstone. In the event the City ultimately determines that there is no other reasonable alternative, Yellowstone shall relocate its facilities as proposed by the City. 10.4 If any improvement project under Section 10.1 is required in the interest of public health, safety, welfare, necessity, as adjudged in the sole discretion of the City, Yellowstone shall make such changes as required herein at Yellowstone's sole cost, expense, and risk. Yellowstone Pipe Line Franchise Ordinance 21-022 Page 7 of 16 10.5 City shall work cooperatively with Yellowstone in determining a viable and practical route within which Yellowstone may relocate its facilities in order to minimize costs, while also meeting the City's project objectives. 10.6 Subject to and provided that the City strictly complies with the timing requirements of this Section 10, Yellowstone shall complete relocation of its facilities to accommodate the improvement project at least 10 calendar days prior to commencement of the improvement project, or such other time as the parties may agree in writing. If the City or its contractor is delayed at any time in the progress of its work by neglect of Yellowstone or the neglect of those acting for or on behalf of Yellowstone, then Yellowstone shall indemnify, defend and hold the City, its officers, officials, employees and volunteers harmless from any and all claims, injuries, damages, losses or suits including attorneys' fees to the extent arising out of or in connection with such delays, except for delays and damages caused by the City or a third party. This provision may not be waived by the parties except in writing. Section 11. Removal,Abandonment in Place. 11.1 In the event of Yellowstone's permanent cessation of use of its facilities or any portion thereof within the franchise area, Yellowstone shall, within 180 days after the cessation of use, remove its facilities or portion thereof. Alternatively, if allowed by the City,Yellowstone will be allowed to abandon in place that portion of its facilities allowable by the City. Abandonment will require, Yellowstone to secure its underground facilities within the franchise area, removing all petroleum products from the facilities, purging vapors, displacing the pipeline contents with an appropriate inert material, and sealing the ends with a suitable end closure,all in compliance with applicable laws. An exception to the removal requirement described above exists for any facilities or portion thereof installed by Horizontal Directional Drill at a depth greater than 10 feet below ground (HDD). Yellowstone will not be required to remove facilities or portions thereof installed by HDD. Instead,Yellowstone will be allowed to abandon those facilities in place pursuant to the abandonment procedures described above. However,upon notice from City as outlined in Section 10,Yellowstone will remove the portion of abandon facilities that conflicts with the City project covered by this Franchise Ordinance unless it was installed by HDD. Permanent cessation shall be the failure to use the facilities for the transportation of petroleum products for at least 365 days, unless otherwise agreed in writing. 11.2 In the event of the removal of all or a portion of the facilities,Yellowstone shall restore any portion of the franchise area its removal actions affected, to as good of a condition as it was before the work began. Yellowstone may, at its option,restore the affected area to a better condition than it was prior to the work. 11.3 Removal and restoration work shall be done at Yellowstone's sole cost and expense and to the City's reasonable satisfaction. Yellowstone shall be responsible for any environmental review required for the removal of any facilities and the payment of any costs of the environmental review. 11.4 If Yellowstone is required to remove its facilities and fails to do so and/or fails to adequately restore the franchise area as specified in Section 11.2 or other mutually agreed upon action(s),the City may, after reasonable notice to Yellowstone, remove its facilities, restore the premises and/or take other action as is reasonably necessary at Yellowstone's expense. This remedy shall not be deemed to be exclusive and shall not prevent the City from seeking a judicial order directing that the facilities be removed. 11.5 The parties expressly agree that Section 11 shall survive the expiration, revocation, or termination of this franchise. Yellowstone Pipe Line Franchise Ordinance 21-022 Page 8 of 16 Section 12. Violations, Remedies,and Termination. 12.1 In addition to any rights set out elsewhere in this franchise, or other rights it may possess at law or equity, the City reserves the right to apply any of the following remedies, alone or in combination, in the event Yellowstone violates any material provision of this franchise. The remedies provided for in this franchise are cumulative and not exclusive;the exercise of one remedy shall not prevent the exercise of any other, or any rights the City may have at law or equity. 12.2 If Yellowstone fails or refuses to comply with this franchise, or any of its terms or provisions, the damages suffered by the City as a result may include,without limitation, increased costs of administration and other damages difficult to measure. Therefore,the City and Yellowstone agree that liquidated damages up to $1,000 per day, per incident or other measure of violation,may be assessed from the first day of the violation or incident, so long as Yellowstone remains non-compliant. These damages represent both parties' best estimate of the damages resulting from the compliance issue. The imposition of liquidated damages will invoke the dispute resolution provisions as provided in this franchise. The imposition of liquidated damages relates only to administrative costs relating to failure to comply with terms of this franchise, and do not relate in any way to determination or assessment of damages relating to a spill, contamination, fire, explosion, or other incident relating to the transport of petroleum products through the facilities. 12.3 City may also terminate this franchise if Yellowstone materially breaches or otherwise fails to perform, comply with or otherwise observe any of the terms and conditions of this franchise, or fails to maintain all required licenses and approvals from federal, state, and local jurisdictions, and fails to cure such breach or default within 30 calendar days of City providing Yellowstone written notice thereof,or, if not reasonably capable of being cured within thirty 30 calendar days, within such other reasonable period of time as the parties may agree upon. 12.4 This franchise shall not be terminated by City except upon a majority vote of the full membership of the City Council, after reasonable notice to Yellowstone and an opportunity to be heard, provided that if exigent circumstances necessitate immediate termination,the hearing may be held as soon as possible after the termination. 12.5 In the event of termination under this franchise,Yellowstone shall immediately discontinue operation of the pipeline through the franchise area, unless safety and environmental considerations dictate a more scheduled, orderly cessation of operations. Either party may in such case invoke the dispute resolution provisions herein. Alternatively, City may elect to seek relief directly in Superior Court, in which case the dispute resolution requirements shall not be applicable in this limited situation. Once Yellowstone's rights to operate in the franchise area have terminated, Yellowstone shall comply with the franchise provision regarding removal and/or abandonment of facilities. 12.6 City's failure to exercise a particular remedy at any time shall not waive City's right to terminate, assess penalties, or assert that or any other remedy at law or equity for any future breach or default of Yellowstone. 12.7 Termination of this franchise shall not release Yellowstone from any liability or obligation with respect to any matter occurring prior to such termination, nor shall such termination release Yellowstone from any obligation to remove or secure the pipeline pursuant to this franchise and to restore the affected franchise area. 12.8 The parties acknowledge that the covenants set forth herein are essential to this franchise, and, but for the mutual agreements of the parties to comply with such covenants, the parties would not have entered Yellowstone Pipe Line Franchise Ordinance 21-022 Page 9 of 16 into this franchise. The parties further acknowledge that they may not have an adequate remedy at law if the other party violates such covenant. Therefore, the parties shall have the right, in addition to any other rights they may have,to obtain in any court of competent jurisdiction injunctive relief to restrain any breach or threatened breach or otherwise to specifically enforce any of the covenants contained herein should the other party fail to perform them. Section 13. Dispute Resolution. 13.1 In the event of a dispute between the City and Yellowstone arising by reason of this franchise, the dispute shall first be referred to the operational officers or representatives designated by the City and Yellowstone to have oversight over the administration of this franchise. The officers or representatives shall meet within 30 calendar days of either party's request for a meeting, whichever request is first, and the parties shall make a good faith effort to attempt to achieve a resolution of the dispute. 13.2 In the event that the parties are unable to resolve the dispute under the procedure set forth in this section, then the parties agree that the matter shall be referred to mediation. The parties shall mutually agree upon a mediator to assist them in resolving their differences. If the parties are unable to agree upon a mediator, the parties shall jointly obtain a list of seven mediators from a reputable dispute resolution organization and alternate striking mediators on that list until one remains. A coin toss shall determine who may strike the first name. If a party fails to notify the other party of which mediator it has stricken within two business days, the other party shall have the option of selecting the mediator from those mediators remaining on the list. Any expenses incidental to mediation shall be borne equally by the parties. 13.3 If the parties fail to achieve a resolution of the dispute through mediation,either party may then pursue any available judicial remedies, provided that if the party seeking judicial redress does not substantially prevail in the judicial action, it shall pay the other party's reasonable legal fees and costs incurred in the judicial action. Section 14. Indemnification. 14.1 General Indemnification. Yellowstone shall indemnify, defend, and hold harmless the City from any and all liability, loss, damage, cost, expense, and claim of any kind, including reasonable attorneys' and experts' fees incurred by the City, arising from Yellowstone's actions except to the extent of City's negligence, in defense thereof, arising out of or related to, directly or indirectly, the installation, construction, operation, use, location, testing, repair, maintenance, removal, or abandonment of Yellowstone's facilities within the franchise area, or from the existence of Yellowstone's facilities within the franchise area, and the products contained in, transferred through, released, or escaped from said facilities, including the reasonable costs of assessing such damages and any liability for costs of investigation, abatement, correction, cleanup, fines, penalties, or other damages arising under any environmental laws. If any action or proceeding is brought against City by reason of Yellowstone's facilities, Yellowstone shall defend the City at Yellowstone's complete expense, provided that, for uninsured actions or proceedings, defense attorneys shall be approved by City,which approval shall not be unreasonably withheld. 14.2 Environmental Indemnification. Yellowstone shall indemnify,defend,and hold harmless the City from and against any and all liability, loss, damage, expense, actions and claims, either at law or in equity, including, but not limited to, costs and reasonable attorneys' and experts' fees incurred by the City, arising from Yellowstone's negligent or intentional actions except to the extent of the City's negligence,in defense thereof, arising directly or indirectly from (a) Yellowstone's breach of any environmental laws applicable to the pipeline subject to this franchise, or (b) from any release of a hazardous substance on or from said Yellowstone Pipe Line Franchise Ordinance 21-022 Page 10 of 16 pipeline, or (c) other activity related to this franchise by Yellowstone, its agents, contractors or subcontractors. This indemnity includes but is not limited to(a) liability for a governmental agency's costs of removal or remedial action for hazardous substances; (b) damages to natural resources caused by hazardous substances, including the reasonable costs of assessing such damages; (c) liability for any other person's costs of responding to hazardous substances;(d)liability for any costs of investigation, abatement, correction, cleanup, fines, penalties, or other damages arising under any environmental laws; and (e) liability for personal injury,property damage, or economic loss arising under any statutory or common-law theory. Section 15. Insurance and Bond Requirements. 15.1 During this franchise, Yellowstone shall provide and maintain, at its own cost, Commercial General Liability insurance in the minimum amount of$100,000,000.00 United States dollars for each occurrence and in the aggregate, in a form and with a carrier reasonably acceptable to the City,naming City as an additional insured,to cover any and all insurable liability,damage, claims, and loss as set forth in Section 14.1 above, and,to the extent such coverage is reasonably available in the commercial marketplace, all liability, damage, claims, and loss as set forth in Section 14.2 above, except for liability for fines and penalties for violation of environmental laws as otherwise provided below but only to the extent of the risks and liabilities assumed by Yellowstone under this Agreement,. Yellowstone's maintenance of insurance as required by the Agreement shall not be construed to limit the liability of Yellowstone to the coverage provided by such insurance, or otherwise limit the City's recourse to any remedy available at law or in equity. Insurance coverage shall include,but is not limited to,all defense costs. Such insurance shall include,but is not limited to, pollution liability coverage, at a minimum covering liability from sudden and accidental occurrences, subject to time element reporting requirements. Yellowstone is permitted to self- insure a portion of the total amount of insurance required in Section 15.1, above, in an amount up to $25,000,000. Required insurance amounts above$25,000,000 may be provided pursuant to the Guaranty, attached and incorporated herein by reference Yellowstone shall provide and maintain at its own cost Automobile Liability insurance covering all owned, non-owned, hired and leased vehicles. Coverage shall be at least as broad as Insurance Services Office (ISO) form CA 00 01. Automobile Liability insurance coverage shall be written in a minimum combined single limit for bodily injury and property damage of $1,000,000 per accident. All coverages required in this Agreement shall be written on an occurrence basis. 15.2 Yellowstone shall provide the City with a certificate of insurance or letter of self-insurance prior to this franchise becoming effective. Said certificate or evidence of self-insurance shall contain a provision that it shall not be canceled without a minimum of 30 days' prior written notice to the City. 15.3 Yellowstone shall provide the City with a bond executed by Yellowstone or Yellowstone's contractors and a corporate surety authorized to operate a surety business in the state of Washington in a sum as may be set by the City, not to exceed $50,000 as sufficient to ensure the performance of Yellowstone's obligations under this franchise. The bond shall be for any of the work, installation, improvements, construction, repair, relocation, or maintenance authorized by this franchise sufficient to ensure performance of Yellowstone's obligations under this franchise, and is intended to ensure that Yellowstone observe all the covenants, terms, and conditions and shall faithfully perform all of the obligations of this franchise, and to repair or replace any defective work or materials discovered in the City's road, streets, or property. The bond shall remain in effect for the life of this franchise. In the event Yellowstone proposes to construct a project for which the above-mentioned bond would not ensure performance of Yellowstone's Yellowstone Pipe Line Franchise Ordinance 21-022 Page 11 of 16 obligations under this franchise,the City is entitled to require such larger bond as may be appropriate under the circumstances. This bond is in lieu of the requirement in City Code whereby Yellowstone would be required to provide a construction bond for each project in the Franchise Area over the life of the franchise. 15.4 The indemnity, insurance, and bond provisions contained herein shall survive the termination of this franchise and shall continue for as long as Yellowstone's facilities shall remain in or on the franchised areas or until the parties execute a new franchise which modifies or terminates these indemnity, insurance, and bond provision but only to the extent of the risks and liabilities assumed by Yellowstone under this Agreement,. Section 16. Receivership and Foreclosure. • 16.1 Yellowstone shall immediately notify the City in writing if Yellowstone files a voluntary petition in bankruptcy, a voluntary petition to reorganize its business, or a voluntary petition to effect a plan or other arrangement with creditors; files an answer admitting the jurisdiction of the Court and the material allegations of an involuntary petition filed pursuant to the Bankruptcy Code, as amended; or is adjudicated bankrupt,makes an assignment for the benefit of creditors, or applies for or consents to the appointment of any receiver or trustee of all or any part of its property including all or any parts of its business operations or facilities within or affecting the Franchise Area. 16.2 Upon the foreclosure or other judicial sale of all or a substantial part of Yellowstone's business operations or facilities within or affecting the Franchise Area, or upon the termination of any lease covering all or a substantial part of the facilities within or affecting the Franchise Area, or upon the occasion of additional events which effectively cause termination of Yellowstone's rights or ability to operate the facilities within or affecting the Franchise Area, Yellowstone shall notify the City of such fact, and such notification or the occurrence of such terminating events shall be treated as a notification that a change in control of Yellowstone has taken place, and the provisions of this Franchise Agreement governing the consent of the City to such change in control of Yellowstone shall apply. 16.3 The City shall have the right to cancel this franchise 120 days. after the appointment of a receiver or trustee to take over and conduct the business of Yellowstone, whether in receivership, reorganization, bankruptcy, or other action or proceeding, unless such receivership or trusteeship shall have been vacated prior to the expiration of said 120 days, or unless: (a) Within 120 days after the election or appointment, such receiver or trustee shall have fully complied with all of the provisions of this franchise Agreement and remedied any existing violations and/or defaults; and (b) Within said 120 days, such receiver or trustee shall have executed an agreement, duly approved by the court having jurisdiction, whereby such receiver or trustee assumes and agrees to be bound by each and every provision of this Franchise Agreement granted to Yellowstone except where expressly prohibited by Washington law. Section 17. Franchise Fee and Costs. In consideration for granting this franchise and for the use of the Franchise Area, there is hereby established a franchise fee of$5,000 so that the City recovers its actual, reasonable, administrative expenses directly related to preparing and approving this franchise, as well as administrative costs associated with administering this franchise through the life of the franchise. Nothing herein shall preclude the City from charging administrative fees or recovering administrative costs incurred by the City in the approval of permits or in the reasonable supervision, inspection or examination of all work by Yellowstone in the franchise area to ensure compliance with the terms of this franchise and the applicable permits, as required by the applicable provisions of the Spokane Valley Municipal Code. Section 18. Legal Relations. Yellowstone Pipe Line Franchise Ordinance 21-022 Page 12 of 16 18.1 Nothing contained in this franchise shall be construed to create an association, trust, partnership, agency relationship,or joint venture or to impose a trust,partnership,or agency duty, obligation,or liability on or with regard to any party. Each party shall be individually and severally liable for its own duties, obligations, and liabilities under this franchise. 18.2 Yellowstone accepts any privileges granted by City to the franchise area, public rights-of-way and other public property in an "as is" condition. Yellowstone agrees that the City has never made any representations, implied or express warranties or guarantees as to the suitability, security or safety of Yellowstone's location of facilities or the facilities themselves in public property or rights-of-way or possible hazards or dangers arising from other uses of the public rights-of-way or other public property by the City or the general public. Yellowstone shall remain solely and separately liable for the function, testing, maintenance, replacement, and/or repair of the pipeline or other activities permitted under this franchise. 18.3 Yellowstone waives immunity under RCW Title 51 in any cases involving the City and affirms that the City and Yellowstone have specifically negotiated this provision,to the extent it may apply. 18.4 This franchise shall not create any duty of the City or any of its officials, employees or agents and no liability shall arise from any action or failure to act by the City or any of its officials, employees or agents in the exercise of powers reserved to the City. Further,this franchise is not intended to acknowledge,create, imply, or expand any duty or liability of the City with respect to any function in the exercise of its police power or for any other purpose. Any duty that may be deemed to be created in the City shall be deemed a duty to the general public and not to any specific party, group, or entity. 18.5 This franchise shall be governed by, and construed in accordance with the laws of the state of Washington and the parties agree that in any action, except actions based on federal questions, venue shall lie exclusively in Spokane County, Washington. Section 19: Miscellaneous. 19.1 In the event that a court or agency of competent jurisdiction declares a material provision of this franchise to be invalid, illegal, or unenforceable, the parties shall negotiate in good faith and agree, to the maximum extent practicable in light of such determination, to such amendments or modifications as are appropriate actions so as to give effect to the intentions of the parties as reflected herein. If severance from this franchise of the particular provision(s) determined to be invalid, illegal, or unenforceable will fundamentally impair the value of this franchise,either party may apply to a court of competent jurisdiction to reform or reconstitute the franchise so as to recapture the original intent of said particular provision(s). All other provisions of this franchise shall remain in effect at ail times during which negotiations or a judicial action remains pending. 19.2 Whenever this franchise sets forth a time for any act to be performed,such time shall be deemed to be of the essence, and any failure to perform within the allotted time may be considered a material violation of this franchise. 19.3 In the event that Yellowstone is prevented or delayed in the performance of any of its obligations under this franchise by reason(s) that are beyond the reasonable control of Yellowstone, then Yellowstone's performance shall be excused during such a force majeure occurrence. Upon removal or termination of the force majeure occurrence, Yellowstone shall promptly perform the affected obligations in an orderly and expedited manner under this franchise or procure a substitute for such obligation or performance that is satisfactory to the City, Yellowstone shall not be excused by mere economic hardship,nor by misfeasance or malfeasance of its directors, officers, or employees. Yellowstone Pipe Line Franchise Ordinance 21-022 Page 13 of 16 19.4 The Section headings in this franchise are for convenience only, and do not purport to and shall not be deemed to define, limit, or extend the scope or intent of the Section to which they pertain. 19.5 By entering into this franchise,the parties expressly do not intend to create any obligation or liability, or promise any performance to any third party, nor have the parties created for any third party any right to enforce this franchise. 19.6 This franchise and all of the terms and provisions shall be binding upon and inure to the benefit of the respective successors and assignees of the parties. 19.7 Whenever this franchise calls for notice to or notification by any party, it(unless otherwise specifically provided) shall be in writing and directed to the recipient at the address set forth in this Section, unless written notice of change of address is provided to the other party. If the date for performing any act is a legal holiday,the act to be performed shall be done on the next succeeding business day which is not a legal holiday. Notices shall be directed to the parties as follows: To the City: To Yellowstone: City Clerk Real Property Administration 10210 East Sprague Avenue P.O. Box 7500 Spokane Valley,WA 99206 Bartlesville,OK 74005-7500 (509) 720-5000 19.8 The parties each represent and warrant that they have full authority to enter into and to perform this franchise, that they are not in default or violation of any permit, license, or similar requirement necessary to carry out the terms hereof, and that no further approval, permit, license, certification, or action by a governmental authority is required to execute and perform this franchise, except such as may be routinely required and obtained in the ordinary course of business. 19.9 This franchise and the attachments hereto represent the entire understanding and agreement between the parties with respect to the subject matter and it supersedes all prior oral negotiations between the parties. This franchise can be amended, supplemented,modified,or changed only by an agreement in writing which makes specific reference to the franchise or the appropriate attachment and which is signed by the party against whom enforcement of any such amendment, supplement, modification or change is sought. All previous franchises between the parties pertaining to Yellowstone's operation of its facilities are hereby superseded. 19.10 Yellowstone shall, within 60 days after passage of this franchise, file with the City Clerk, its unconditional written acceptance of all the terms and conditions of this franchise,as well as documentation evidencing the insurance and bond requirements pursuant to Section 15. If Yellowstone fails to so file its written acceptance and provide the insurance and bond verification within such period, then the rights and privileges granted hereunder shall be deemed forfeited. Section 20: Severability. If any section, sentence, clause or phrase of this Ordinance should be held to be invalid or unconstitutional by a court of competent jurisdiction, such invalidity or unconstitutionality shall not affect the validity or constitutionality of any other section,sentence, clause or phrase of this Ordinance. In the event that any of the provisions of the franchise are held to be invalid by a court of competent jurisdiction,the City reserves the right to reconsider the grant of the franchise and may amend,repeal,add, replace or modify any other provision of the franchise, or may terminate the franchise. Yellowstone Pipe Line Franchise Ordinance 21-022 Page 14 of 16 Section 21: Effective Date This ordinance shall be in full force and effect five days after publication of the Ordinance or a summary thereof occurs in the official newspaper of the City of Spokane Valley as provided by law. PASSED by the City Council this 23rd day of November, 2021. (-4 Ben Wick,Mayor ATTEST. Christine Bainbridge, City Clerk y Approved as to Form: P-70,"0 Office . the City Attorney Date of Publication: V-,71.4,21,72 Effective Date: d d2 - r)�' -.,2(f„-o2 Yellowstone Pipe Line Franchise Ordinance 21-022 Page 15 of 16 UNCONDITIONAL ACCEPTANCE BY YELLOWSTONE: I,the undersigned official of Yellowstone Pipe Line Company, am authorized to bind Yellowstone Pipe Line Company and to unconditionally accept the terms and conditions of the foregoing franchise, which are hereby accepted by Yellowstone Pipe Line Company this 24th day of January, 2022. &. Yellowstone Pipe Line Company By: Name: Edmund J. Brooks Title: ATTa.4rvfY- 2W-, .9cr IN WITNESS WHEREOF, Edmund J. Brooks has signed this 24t day of January, 2022. Subscribed and sworn before me this 24th day of January 2022. REF3ECCA MAUfiA KANE Notary Public in and for the State of aeLM/FAG9 Notary Public residing in 4AAMS e'/(oN7y State of Colorado My commission expires ©1-.2 —?/JV Notary 1D#20204003201 My Commission Expires 01-24-2024 Yellowstone Pipe Line Franchise Ordinance 21-022 Page 16 of 16 101 %ftfti ne polo, FValleyk BOND NO: 107521291 CONTRACTOR'S PERFORMANCE BOND to City of Spokane Valley,Washington The City of Spokane Valley, Washington, in Spokane County,has awarded to Yellowstone Pipe Line Company(Contractor),as Principal,a contract for the construction of the project designated as Franchise Agreement, Project No. ORD 21-022 in Spokane Valley, Washington, and said Principal is required under the terms of the Contract to furnish a performance bond in accordance with chapter 39.08 Revised Code of Washington(RCW). The Principal, and Travelers Casualty and Surety Company of America (Surety), a corporation, organized under the laws of Connecticut Companies Acceptable in Federal Bonds"as published in the Federal Register by the Audit Staff Bureau of Accounts, U.S. Treasury Dept., are jointly and severally held and firmly bound to the City of Spokane Valley, as Obligee, in the sum of $50,000.00 total Contract amount(including Washington State sales tax),subject to the provisions herein. This performance bond shall become null and void, if and when the Principal, its heirs,executors, administrators, successors, or assigns shall well and faithfully perform all of the Principal's obligations under the Contract and fulfill all the terms and conditions of all duly authorized modifications, additions, and changes to said Contract that may hereafter be made, at the time and in the manner therein specified;shall warranty the work as provided in the Contract and shall indemnify and hold harmless the Obligee from any defects in the workmanship and materials incorporated into the work for the period identified in the Contract;and if such performance obligations have not been fulfilled,this bond shall remain in full force and effect. The Surety for value received agrees that no change, extension of time, alteration or addition to the terms of the Contract, the specifications accompanying the Contract,or to the work to be performed under the Contract shall in any way affect its obligation on this bond, and waives notice of any change, extension of time, alteration or addition to the terms of the Contract or the work performed. The Surety agrees that modifications and changes to the terms and conditions of the Contract that increase the total amount to be paid the Principal shall automatically increase the obligation of the Surety on this bond and notice to Surety is not required for such increased obligation. This bond may be executed in two original counterparts,and shall be signed by the parties'duly authorized officers.This bond will only be accepted if it is accompanied by a fully executed and original power of attorney for the officer executing on behalf of the surety. PRINCIPAL: Yellowstone Pipe Line Company SURETY: Travelers Casualty and Surety Company of America 1-" /"..**334\ 12-07-2021 Principal Signature Date Surety Signature Date +'.„*OI I"...... " Melissa Haddick SURE Tco% Printed Name Geoff Reid Printed Name 1. Attorne -In-Fact _` HARTFORD,, Title Assistant Treasurer Title s`ncy:�. � Name,address,and telephone of local office/agent f Surety Comany i Marsh USA,Inc..2929 Allen Parkway,Suite 2500pHoust TX 77019s ,�� ;,,,,;,.µ+►`'�'�*�' (713)276-8500 Updated 1.14.2013 Travelers Casualty and Surety Company of America AMIlk Travelers Casualty and Surety Company TRAVELERS J St. Paul Fire and Marine Insurance Company POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS: That Travelers Casualty and Surety Company of America,Travelers Casualty and Surety Company, and St. Paul Fire and Marine Insurance Company are corporations duly organized under the laws of the State of Connecticut (herein collectively called the "Companies"), and that the Companies do hereby make, constitute and appoint Melissa Haddlck of Houston Texas , their true and lawful Attorney(s)-in-Fact to sign, execute, seal and acknowledge any and all bonds, recognizances,conditional undertakings and other writings obligatory in the nature thereof on behalf of the Companies in their business of guaranteeing the fidelity of persons, guaranteeing the performance of contracts and executing or guaranteeing bonds and undertakings required or permitted in any actions or proceedings allowed by law. IN WITNESS WHEREOF,the Companies have caused this instrument to be signed,and their corporate seals to be hereto affixed,this 21st day of April, 2021. r" ''p suHF7;CU ilTliYd.,'� N p •P *.i-iART pH0 'K C � ~ 44 cAinroRo ' cc-Q coraN. o ! !f!a t t'', £ w cenN. 4 ti rk 'i�': N'a%ti._,....gar t fr ,,,,,,nn n,rww" State of Connecticut By: City of Hartford ss. Robert Raney,Senior Vice President On this the 21st day of April,2021,before me personally appeared Robert L.Raney,who acknowledged himself to be the Senior Vice President of each of the Companies, and that he, as such, being authorized so to do, executed the foregoing instrument for the purposes therein contained by signing on behalf of said Companies by himself as a duly authorized officer. IN WITNESS WHEREOF, I hereunto set my hand and official seal. , 0.Z64x . ///JJ////�� if.egtd9101ARY Eg��� My Commission expires the 30th day of June, 2026 * 011a eieo0 Anna P. Nowik, Notary Public This Power of Attorney is granted under and by the authority of the following resolutions adopted by the Boards of Directors of each of the Companies, which resolutions are now in full force and effect,reading as follows: RESOLVED,that the Chairman,the President, any Vice Chairman, any Executive Vice President,any Senior Vice President, any Vice President, any • Second Vice President,the Treasurer,any Assistant Treasurer,the Corporate Secretary or any Assistant Secretary may appoint Attorneys-in-Fact and Agents to act for and on behalf of the Company and may give such appointee such authority as his or her certificate of authority may prescribe to sign with the Company's name and seal with the Company's seal bonds,recognizances,contracts of indemnity,and other writings obligatory in the nature of a bond, recognizance, or conditional undertaking, and any of said officers or the Board of Directors at any time may remove any such appointee and revoke the power given him or her;and it is FURTHER RESOLVED, that the Chairman, the President, any Vice Chairman, any Executive Vice President, any Senior Vice President or any Vice President may delegate all or any part of the foregoing authority to one or more officers or employees of this Company,provided that each such delegation is in writing and a copy thereof is filed in the office of the Secretary;and it is FURTHER RESOLVED,that any bond,recognizance,contract of indemnity,or writing obligatory in the nature of a bond, recognizance,or conditional undertaking shall be valid and binding upon the Company when (a) signed by the President, any Vice Chairman, any Executive Vice President, any Senior Vice President or any Vice President, any Second Vice President, the Treasurer, any Assistant Treasurer, the Corporate Secretary or any Assistant Secretary and duly attested and sealed with the Company's seat by a Secretary or Assistant Secretary;or(b)duly executed(under seal, if required)by one or more Attorneys-in-Fact and Agents pursuant to the power prescribed in his or her certificate or their certificates of authority or by one or more Company officers pursuant to a written delegation of authority;and it is FURTHER RESOLVED, that the signature of each of the following officers: President, any Executive Vice President, any Senior Vice President, any Vice President,any Assistant Vice President,any Secretary, any Assistant Secretary, and the seal of the Company may be affixed by facsimile to any Power of Attorney or to any certificate relating thereto appointing Resident Vice Presidents, Resident Assistant Secretaries or Attorneys-In-Fact for purposes only of executing and attesting bonds and undertakings and other writings obligatory in the nature thereof,and any such Power of Attorney or certificate bearing such facsimile signature or facsimile seal shall be valid and binding upon the Company and any such power so executed and certified by such facsimile signature and facsimile seal shall be valid and binding on the Company in the future with respect to any bond or understanding to which it Is attached. 1,Kevin E. Hughes,the undersigned,Assistant Secretary of each of the Companies,do hereby certify that the above and foregoing is a true and correct copy of the Power of Attorney executed by said Companies,which remains in full force and effect. 7th December Dated this day of 2021 • `��+N+N�ft ri+►q 4„.....„..''''''''e,,..., . .,,, .- e_o--.."),..-T-,„ z „....: 0„,...7.0,,,t ,,,,. , 4,. ...,, HARTFORD.;K= 2 tlAMI r;(+,�►'7urt , CONN. is ' CONN, s' t ��ORD,t:CT3�1 a$ rUt . 1. 4s, i IF.f..)‘ COri : g Kevin E.Hu hes,Assistant Secretary t.tp% .rfin, To verify the au then ticity of this Pole•+��` of••'••`�\rit,y,�a(�se call us at 1-800-421-3880. Please refer to the above-named Attorney(s)-in-Fact and f�cfxgAMhe bond to which this Power of Attorney is attached. DATE(MMIDDIYYYY) AWRD CERTIFICATE OF LIABILITY INSURANCE 9/15/2022 11/9/2021 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER,AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED,the poilcy(ies) must have ADDITIONAL INSURED provisions or be endorsed. If SUBROGATION IS WAIVED,subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). PRODUCER LOCKTON COMPANIES NAMEACT 3657 BRIARPARK DRIVE,SUITE 700 PHONE FAX HOUSTON TX 77042 E-MANo,Extl: fAle,Not: 866-260-3538 ADDRESS: INSURER(S)AFFORDING COVERAGE NAIC# INSURER A:Old Republic Insurance Company 24147 INSURED Sunoco Pipeline L.P. INSURER B: 1435373 3801 West Chester Pike INSURER C: Newtown Square PA 19073 INSURER D: INSURER E:. INSURER F: COVERAGES CERTIFICATE NUMBER: 18003864 REVISION NUMBER: XXXXXXX THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT,TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES.LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. 1P LT R TYPE OF INSURANCE ADM.SUER POLICPOLICY NUMBER IMMP DY EFF/YYYY) (MMIDDmYY) LIMITS LTR INSD WVO A X COMMERCIAL GENERAL LIABILITY Y y MWZY 59829 21 9/15/2021 9/15/2022 EACH OCCURRENCE $ 10,000,000 DAMAGE TO REN CLAIMS-MADE ! X OCCUR PREMISES(Es occur ence) $ 10,000,000 MED EXP(Any one person) $ XXXXXXX PERSONAL&ADV INJURY $ 10,000,000 GEM,AGGREGATE LIMIT APPLIES PER: GENERAL AGGREGATE $ 10,000,000 X POLICY L I PRO- JECT LOC PRODUCTS-COMP/OP AGG s See Below OTHER: $ A AUTOMOBILE LIABILITY y y MWTB 2171 1-21 9/15/2021 9/15/2022 C(Ea accidOMBINED SINGLE LIMIT $ 10,000,000 ent) '` x ANY AUTO MWZX 315003 21 9/I5/2(121 9/15/2022 BODILY INJURY(Per person) $ XXXXXXX OWNED SCHEDULED BODILY INJURY(Per accident) $ XXXXXXX AUTOSREDONLY AU TOS $ XXXXXXX HIRED AUTO WN PROPERTYaccident) DAMAGE AUTOS ONLY AUTOS ONLY (Per accident) _ X MCS-90 $ XXXXXXX A UMBRELLA LIAB X OCCUR Y Y MWZX 314235-21 9/15/2021 9/15/2022 EACH OCCURRENCE $ 10,000,000 A EXCESS LIAR BUFFER XS LIAB 9/15/2021 9/15/2022 X CLAIMS MADE AGGREGATE $ 10,000,000 DED RETENTION$ $ XXXXXXX WORKERS COMPENSATION OTH- A Y MWC 117949-21 9/15/2021 9/15/2022 X I STATUTE R I ER - AND EMPLOYERS'LIABILITY Y 1 N ~ ANY PROPRIETOR/PARTNERIEXECUTIVE �'( N I A E,I-,EACH ACCIDENT $ 10,000 00(1 OFFICER/MEMBER EXCLUDED? I (Mandatory in NH) E.L.DISEASE-LA EMPLOYEE S 10,000,000 If yes,describe under DESCRIPTION OF OPERATIONS below E.L.DISEASE-POLICY LIMIT $ 10,000,000 A *Excess Workers Compensation N Y MWXS 300313-21 9/15/2021 9/15/2022 EL Each Ace$IOMM EL Discasc-Policy Lim$10MM EL Disease-Each Empl$10MM DESCRIPTION OF OPERATIONS I LOCATIONS/VEHICLES (ACORD 1D1,Additional Remarks Schedule,may be attached If more space is required} EXCESS WORKERS COMPENSATION-*POLICY APPLIES TO OHIO. Products/Completed Operations Aggregate Limit Subject to the General Aggregate Limit. All policies(except Workers'Compensation/EL)contain a special endorsement with"Primary and Noncontributory"wording. Re: City of Spokane Valley—Ordinance No. 21-022 CERTIFICATE HOLDER CANCELLATION See Attachment 18003864 • City of Spokane Valley SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE 10210 East Sprague Avenue THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. Spokane Valley WA 99206 AUTHORIZED REPRESENTATIVE I 01988-2015 ACORD CORPORATIO . All rights reserved. ACORD 25(2016/03) The ACORD name and logo are registered marks of ACORD Attachment Code:D554141 Master ID: 1435373,Certificate ID: 18003864 All policies (except Workers' Compensation/EL) include a blanket automatic additional insured endorsement[provision] that confers additional insured status to the certificate holder only if there is a written contract between the named insured and the certificate holder that requires the named insured to name the certificate holder as an additional insured. In the absence of such a contractual obligation on the part of the named insured, the certificate holder is not an additional insured under the policy. All policies include a blanket automatic waiver of subrogation endorsement[provision]that provides this feature only when there is a written contract between the named insured and the certificate holder that requires it. In the absence of such a contractual obligation on the part of the named insured, the waiver of subrogation feature does not apply. GUARANTEE THIS GUARANTEE, effective as of November 2, 2020, is made by Yellowstone Logistics Holding Company, a Delaware Corporation, with an office at 22777 Springwoods Village Pkwy, Spring TX 77389 ("GUARANTOR")and a shareholder of GUARANTEED PARTY (as defined below), for the benefit of the parties set forth on Schedule I hereto from time to time (each a "MUNICIPALITY"and, taken as a whole, "BENEFICIARY") and; WITNESSETH: WHEREAS, in connection with its continued operation of the Yellowstone pipeline, Yellowstone Pipe Line Company, a Delaware corporation(the "GUARANTEED PARTY"), has entered into, or will be entering into, with each Municipality the franchise ordinances, easements or similar agreements that are set forth on Schedule I hereto directly across from such MUNICIPALITY'S name and address (each, an "Agreement" and, collectively, the "Agreements"). WHEREAS,GUARANTOR holds a 40%ownership interest in GUARANTEED PARTY (the"Ownership Percentage"). WHEREAS, each of the other holders of ownership interests in GUARANTEED PARTY (collectively, the "Other Guarantors") may choose to enter into a guarantee, on or about the date hereof, reflecting its applicable ownership percentage but otherwise in form and substance substantially similar to this Guarantee (collectively, the "Other Guarantees"); WHEREAS, it is a condition of each Agreement that GUARANTOR and the Other Guarantors may provide a guarantee of certain obligations covered by traditional insurance as contemplated in the applicable section of each Agreement as set forth on Schedule I hereto. NOW, THEREFORE, in consideration of the premises set out herein and for other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged GUARANTOR does hereby agree as follows: ARTICLE I DEFINITIONS Section 1.1. Definitions. Except as otherwise expressly provided or unless the context otherwise requires,the terms defined in this Section 1.1 and the preamble and recitals hereto, shall for all purposes of this Guarantee, have the meanings herein specified, such definitions to be equally applicable to both the singular and plural forms of any of the terms herein defined: Banking Day The term"Banking Day" shall mean any day other than a Saturday, a Sunday or a Federal Reserve Bank holiday. Guarantee The term"Guarantee" shall mean this Guarantee, as originally executed or as it may from time to time be supplemented, modified or amended as provided herein. Other Guarantee The term"Other Guarantee"shall mean each Other Guarantee,as originally executed or as it may from time to time be supplemented, modified or amended concurrent in time and in a manner substantially similar to any supplement, modification or amendment to this Guarantee. Person The term "Person" shall mean an individual, a corporation, a limited liability entity, a partnership, a joint venture, an association, a joint stock company, a trust, an unincorporated organization or a government or any agency, authority or political subdivision thereof. Self Insurance Amount The term"Self Insurance Amount"shall mean, with respect to any MUNICIPALITY, the amount set forth next to such MUNICIPALITY'S name and address on Schedule I hereto. ARTICLE II REPRESENTATIONS OF GUARANTOR Section 2.1. Representations of GUARANTOR. GUARANTOR represents and warrants as follows: (a) GUARANTOR has been duly organized and is validly existing under the laws of its jurisdiction of organization and has full corporate power and authority to enter into this Guarantee and to carry out and consummate all transactions contemplated by this Guarantee. (b) The execution and delivery of this Guarantee and the consummation of the transactions herein contemplated require no action by or filing with any governmental body or court having jurisdiction over GUARANTOR. (c) This Guarantee has been duly authorized, executed and delivered by GUARANTOR and constitutes the valid and binding obligation of GUARANTOR, enforceable against GUARANTOR in accordance with its terms, subject, as to enforceability only, to applicable bankruptcy, moratorium, insolvency or similar laws affecting the rights of creditors generally and to general principles of equity. 2 ARTICLE III GUARANTEE AND AGREEMENTS Section 3.1. Guarantee. GUARANTOR guarantees to BENEFICIARY that if GUARANTEED PARTY does not timely pay its obligations covered by traditional insurance as contemplated in the applicable section of each Agreement as set forth on Schedule I hereto set forth in the Agreements (collectively, the "Financial Obligations"), GUARANTOR will, subject to receipt of Notice(s) (in compliance with and as defined in clause (a) below), make available or cause to be made available sufficient funds to fulfill its Ownership Percentage of any unfulfilled Financial Obligation in excess of the applicable Self Insurance Amount and in accordance with the applicable Agreement,up to a maximum amount(the"Maximum Amount")not to exceed the Ownership Percentage multiplied by(i)US$75,000,000 less(ii)any amounts previously expended by GUARANTEED PARTY to any MUNICIPALITY or MUNICIPALITIES in excess of the Self Insurance Amount(s) with respect to the Financial Obligations, less (iii) any amounts previously paid under this Guarantee and any amounts previously paid or required to be paid under the Other Guarantees to any MUNICIPALITY or MUNICIPALITIES. Notwithstanding anything to the contrary herein, GUARANTOR shall under no circumstances be liable for more than US$30,000,000 in the aggregate to BENEFICIARY hereunder. All payments by GUARANTOR shall be made in lawful money of the United States of America. (a) In order for a MUNICIPALITY to exercise its rights under this Guarantee, such MUNICIPALITY must provide to GUARANTOR at GUARANTOR'S address set forth in Section 4.2 herein written notice, signed by an authorized representative of MUNICIPALITY(the "Notice"), of GUARANTEED PARTY's default with respect to the Financial Obligations under the applicable Agreement with such MUNICIPALITY, specifically setting forth: (i) the clause(s)that is (are)purported to have been defaulted on, (ii) that GUARANTEED PARTY has failed to make timely payment of all or any part of its Financial Obligations under such Agreement, (iii) a description of the unfulfilled Financial Obligations and the amount to be paid by GUARANTEED PARTY as a consequence of such default(the"Default Amount") multiplied by the Ownership Percentage (the "Guaranteed Amount"), (iv) that GUARANTEED PARTY has not paid to MUNICIPALITY the Default Amount,that GUARANTEED PARTY has been notified in writing by MUNICIPALITY, of such non-payment, and has been advised of MUNICIPALITY's intent to draw against this Guarantee and the Other Guarantees; and (v) a certification that MUNICIPALITY is simultaneously drawing against the Other Guarantees in an aggregate amount equal to the Default Amount less the Guaranteed Amount. (b) Payment under this Guarantee shall be made within fifteen (15) days after a MUNICIPALITY's presentation of a duly executed Notice. At such time, such 3 MUNICIPALITY will be entitled to receive from GUARANTOR payment in immediately available funds for the lesser of (i) the Maximum Amount and (ii) the Guaranteed Amount. Payment shall be made to MUNICIPALITY in the manner set forth in the Notice. Section 3.2. Waiver. Except as otherwise provided herein, GUARANTOR hereby waives: (a) notice of acceptance of this Guarantee; (b) notice of any modification, amendment, extension or waiver under any Agreement(except to the extent the Financial Obligations are reduced or changed thereby); (c) any failure, omission or delay on the part of any MUNICIPALITY to enforce, assert or exercise any right,power or remedy it has against the GUARANTEED PARTY; (d) the voluntary or involuntary liquidation, dissolution, sale or other disposition of all or substantially all the assets, marshalling of assets and liabilities, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition with creditors or readjustment of, or other similar proceedings affecting GUARANTOR or GUARANTEED PARTY or any of the respective assets of either of them, or any allegation or contest of the validity of this Guarantee in any such proceeding; and (e) any defense based upon any legal disability of GUARANTEED PARTY; provided, however, notwithstanding the foregoing, in any suit brought or demand made by any MUNICIPALITY against GUARANTOR to enforce its obligations under this Guarantee, GUARANTOR shall be entitled to assert any defense that would be available to the GUARANTEED PARTY if an action had been brought by such MUNICIPALITY against the GUARANTEED PARTY. Notwithstanding anything to the contrary herein, GUARANTOR shall have no liability for any indirect,special,consequential,or punitive damages arising from or relating to this Guarantee or the transactions contemplated hereby, including without Iimitation any such damages that may result from or be attributable to a breach or default by GUARANTEED PARTY under any Agreement. Section 3.3. Costs. If a MUNICIPALITY makes a legal claim against GUARANTOR and MUNICIPALITY wins the legal claim,GUARANTOR agrees to pay all costs,expenses and fees, including all reasonable attorneys' fees, which may be incurred by such MUNICIPALITY in enforcing or attempting to enforce this Guarantee following any default on the part of GUARANTOR hereunder,whether the same shall be enforced by suit or otherwise. ARTICLE IV MISCELLANEOUS Section 4.1. Governing Law and Dispute Resolution. This Guarantee shall be governed by, and construed in accordance with, the laws of the State of New York(excluding the choice of 4 law principles thereof). Any dispute between GUARANTOR and any MUNICIPALITY shall be resolved in accordance with the procedures set forth in the dispute resolution provisions (if any) found in the applicable Agreement. Section 4.2. Notices. All notices and other communications to GUARANTOR with respect to this Guarantee shall be electronically communicated or hand delivered at the address or facsimile transmission number as provided in this Section 4.2: All communications intended for GUARANTOR shall be sent to: Yellowstone Logistics Holding Company 22777 Springwoods Village Pkwy, Spring TX 77389 Attn: President Fax Number: 832-648-6335 or at any other address or facsimile transmission number of which GUARANTOR shall have notified each MUNICIPALITY in any manner prescribed in this Section 4.2. All communications intended for a MUNICIPALITY OR GUARANTEED PARTY shall be sent in accordance with the notice provisions of the applicable Agreement. For all purposes of this Guarantee,a notice or communication will be deemed effective: (a) if delivered by hand, (i) on the day it is delivered unless that day is not a Banking Day or (ii) if delivered after the close of business on a Banking Day, then on the next succeeding Banking Day,and (b) if sent by facsimile transmission, on the date transmitted,as evidenced by a facsimile confirmation sheet produced by the sender's facsimile machine, unless the date of transmission and confirmation is not a Banking Day, or the time of confirmation is after the close of business on such day, in which cases notice shall be effective on the next succeeding Banking Day. Section 4.3. Banking Days. Except as otherwise provided in this Guarantee, if any date on which a payment is to be made, notice is to be given or other action taken hereunder is not a Banking Day,then such payment,notice or other action shall be made, given or taken on the next succeeding Banking Day,and in the case of any payment, no interest shall accrue for the delay. Section 4.4. Successors and Assigns. This Guarantee shall be binding upon GUARANTOR and its successors and permitted assigns and inure to the benefit of each MUNICIPALITY and its permitted successors and assigns. GUARANTOR may not assign its obligations hereunder without the prior written consent of each MUNICIPALITY (not to be unreasonably withheld or delayed), provided that a MUNICIPALITY shall not be entitled to withhold acceptance of an assignee if the proposed assignee has a consolidated net worth of not less than five(5)times the Maximum Amount. No MUNICIPALITY may assign, sell,or transfer its rights or interests in this Guarantee except with the prior written consent of GUARANTOR(not to be unreasonably withheld or delayed). 5 Section 4.5. Guarantee for Benefit of BENEFICIARY. This Guarantee is entered into by GUARANTOR for the benefit of BENEFICIARY. Nothing contained herein shall be deemed to create any right in, or permit any Person to enforce or make any claim hereunder or to be in whole or in part for the benefit of any Person other than GUARANTOR, each MUNICIPALITY and their respective permitted successors and assigns. Section 4.6. Term. This Guarantee shall terminate automatically and be of no further force and effect with respect to a MUNICIPALITY upon the earliest of(a) the date on which the Maximum Amount under this Guarantee is reduced to US$0, (b) the date on which the applicable Agreement has expired or has otherwise been terminated in accordance with its terms and (c) the date on which GUARANTOR ceases to be a shareholder of GUARANTEED PARTY. For the avoidance of doubt,a Person shall no longer be deemed to be a MUNICIPALITY for purposes of this Guarantee upon the occurrence of the event set forth in clause(b)of the immediately preceding sentence or the removal of such Person from Schedule I in accordance with Section 4.7. Section 4.7. Amendments and Waivers. Any provision of this Guarantee may be amended or waived if, but only if, such amendment or waiver is in writing and is signed by GUARANTOR and acknowledged in writing by each MUNICIPALITY;provided, however, that in no event shall the acknowledgement of any MUNICIPALITY be required to amend Schedule I hereto in any respect (including, without limitation, to add any MUNICIPALITY), unless such amendment removes such MUNICIPALITY from Schedule I. GUARANTOR hereby agrees to deliver copies of all amendments of Schedule I hereto to each MUNICIPALITY at its address specified on such Schedule I, whether or not the acknowledgement or consent of such MUNICIPALITY is required. Section 4.8. Headings. The article and section headings of this Guarantee are for convenience only and shall not affect the construction hereof. Section 4.9. Partial Invalidity. The invalidity of any one or more phrases, sentences, clauses or sections in this Guarantee shall not affect the validity or enforceability of the remaining portions of this Guarantee or any part thereof. 6 Section 4.10 No Waiver, Remedies. No failure or delay by a MUNICIPALITY in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right,power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. Section 4.11 Entire Agreement. This Guarantee constitutes the entire agreement and understanding of the parties with respect to the subject matter and supersedes all oral statements and prior writings with respect thereto. 7 IN WITNESS WHEREOF, GUARANTOR has caused this Guarantee to be executed in its name and on its behalf by its respective duly authorized representatives as of the date first above written. Yellowstone Logistics Holding Company By: Yale Name: 6,e,i d s Title: ��e.s d'24 i 8 DowSign Envelope ID:8D916621-8CA3-48E1-ACDS-8D7174C3E1CD FIRST AMENDMENT TO GUARANTEE This First Amendment to Guarantee(this "Amendment") is dated as of December 7, 2021 (the "Amendment Effective Date") and made by Yellowstone Logistics Holding Company, a Delaware Corporation, with an office at 22777 Springwoods Village Pkwy, Spring TX 77389 ("Guarantor"); RECITALS: WHEREAS, Guarantor previously executed that certain Guarantee dated effective as of November 2, 2020 (the "Guarantee") for the benefit of each Municipality and Beneficiary, as defined therein. WHEREAS,pursuant to Section 4.7 of the Guarantee, Guarantor now wishes to amend the Guarantee to delete Schedule I and replace it with Schedule I attached hereto. NOW, THEREFORE, in consideration of the premises set out herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged Guarantor does hereby agree as follows: DEFINITIONS 1.1 Definitions. Unless otherwise defined herein, capitalized terms used in this Amendment shall have the respective meanings ascribed to such terms in the Guarantee. ARTICLE II AMENDMENTS 2.1 Amendment to Schedule I. Schedule I of the Guarantee is hereby deleted in its entirety and replaced with the Beneficiary List attached hereto as Schedule I:. ARTICLE HI GENERAL PROVISIONS 3.1 Effectiveness and Ratification. All of the provisions of this Amendment shall be effective as of the date hereof. Except as specifically provided for in this Amendment, the terms of the Guarantee shall remain in full force and effect. In the event of any conflict or inconsistency between the terms of this Amendment and the Guarantee, the terms of this Guarantee shall prevail and govern. 3.2 Entire Agreement. This Amendment, the schedule attached hereto and the Guarantee (as amended hereby) constitutes the full and entire understanding and agreement DocuSign Envelope ID: 8D916621-8CA3-48E1-ACD5.8D7174C3E1CD between the parties with respect to the subject matter hereof and thereof, and supersedes all prior or contemporaneous agreements,understandings, representations or warranties among the Parties, oral or written, other than those set forth or referred to herein. 3.3 Partial Invalidity. The invalidity of any one or more phrases, sentences, clauses or sections in this Amendment shall not affect the validity or enforceability of the remaining portions of this Amendment or any part thereof. 3.4 Governing Law; Jurisdiction. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York (excluding the choice of law principles thereof). [Signature page follows.] 2 DocuSign Envelope ID:8D916621-8CA3-48E1-ACD5-8D7174C3E1CD IN'WITNESS WHEREOF, Guarantor has caused this Amendment to be executed in its name and on its behalf by a duly authorized representative, effective as of the Amendment Effective Date. Yellowstone Logistics Holding Company c0ocuSigned by: By: --ssfi A. 1*" Name: steven A. Yatauro Title: President DocuSign Envelope ID:8D916621-8CA3.48E1-ACD5-8D7174C3E1 CD SCHEDULE 1 BENEFICIARY LIST Municipality Name, Agreement Self Insurance Address&Telephone No. Amount City of Spokane Yellowstone Pipe Line Company $25,000,000 c/o the Office of the City Attorney Pipeline Franchise Agreement 808 W. Spokane Falls Blvd. City of Spokane ORD C35924 Spokane,WA 99201-3326 509-755-2489 City of Spokane Valley Yellowstone Pipe Line Company $25,000,000 c/o the Office of the City Attorney Pipeline Franchise Agreement 10210 East Sprague Avenue City of Spokane Valley Spokane Valley,WA 99206 ORD 21-022 Phone: (509)720-5150 Schedule I to First Amendment to Guarantee GUARANTEE THIS GUARANTEE, dated as of September 14, 2020, is made by Phillips 66 Pipeline LLC, u Delaware limited liability company, with an office at 2331 CityWest Blvd., Houston, Texas 77042("GUARANTOR") and a shareholder of GUARANTEED PARTY (as defined below), for the benefit of the parties set forth on Schedule I hereto from time to time (each a "MUNICIPALITY" and, taken as a whole,"BENEFICIARY") and; WITNESSETH; WHEREAS, in connection with its continued operation of the Yellowstone pipeline, Yellowstone Pipe Line Company, a Delaware corporation (the"GUARANTEED PARTY"), has entered into, or will be entering into, with each Municipality the franchise ordinances, easements or similar agreements that arc set forth on Schedule I hereto directly across from such MUNICIPALITY'S name and address (each, an "Agreement" and, collectively, the "Agreements"). WHEREAS, GUARANTOR holds a 46%ownership interest in GUARANTEED PARTY (the"Ownership Percentage"). WHEREAS, each of the other holders of ownership interests in GUARANTEED PARTY (collectively, the "Other Guarantors") may choose to enter into a guarantee, on or about the date hereof, reflecting its applicable ownership percentage but otherwise in form and substance substantially similar to this Guarantee(collectively, the"Other Guarantees"); WHEREAS, it is a condition of each Agreement that GUARANTOR and the Other Guarantors may provide a guarantee of certain [obligations covered by traditional insurance as contemplated in the applicable section of each Agreement as set forth on Schedule I heretoj. NOW, THEREFORE, in consideration of the premises set out herein and for other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged GUARANTOR does hereby agree as follows: ARTICLE I DEFINITIONS Section I.I. Definitions. Except as otherwise expressly provided or unless the context otherwise requires, the terms defined in this Section I.I and the preamble and recitals hereto,shall for all purposes of this Guarantee, have the meanings herein specified, such definitions to be equally applicable to both the singular and plural forms of any of the terms herein defined: Banking Day The term"Banking Day"shall mean any day other than a Saturday, a Sunday or a Federal Reserve Bank holiday. Guarantee The term "Guarantee"shall mean this Guarantee, as originally executed or as it may from • time to time be supplemented, modified or amended as provided herein. Other Guarantee The term"Other Guarantee"shall mean each Other Guarantee,as originally executed or as it may from time to time be supplemented, modified or amended concurrent in time and in a manner substantially similar to any supplement, modification or amendment to this Guarantee. Person The term "Person" shall mean an individual, a corporation, a limited liability entity, a partnership, a joint venture, an association, a joint stock company, a trust, an unincorporated organization or a government or any agency,authority or political subdivision thereof: Self Insurance Amount The term"Self Insurance Amount"shall mean, with respect to any MUNICIPALITY, the amount set forth next to such MUNICIPALITY'S name and address on Schedule I hereto. ARTICLE II REPRESENTATIONS OF GUARANTOR Section 2.1. Representations of GUARANTOR. GUARANTOR represents and warrants as follows: (a) GUARANTOR has been duly organized and is validly existing under the laws of its jurisdiction of organization and has full corporate power and authority to enter into this Guarantee and to carry out and consummate all transactions contemplated by this Guarantee. (b) The execution and delivery of this Guarantee and the consummation of the transactions herein contemplated require no action by or filing with any governmental body or court having jurisdiction over GUARANTOR. (c) This Guarantee has been duly authorized, executed and delivered by GUARANTOR and constitutes the valid and binding obligation of GUARANTOR, enforceable against GUARANTOR in accordance with its terms, subject, as to enforceability only, to applicable bankruptcy, moratorium, insolvency or similar laws affecting the rights of creditors generally and to general principles of equity. 2 ARTICLE III GUARANTEE AND AGREEMENTS Section 3.1. Guarantee. GUARANTOR guarantees to BENEFICIARY that if GUARANTEED PARTY does not timely pay its [obligations covered by traditional insurance as contemplated in the applicable section of each Agreement as set forth on Schedule I hereto] set forth in the Agreements (collectively, the "Financial Obligations"), GUARANTOR will, subject to receipt of Notices) (in compliance with and as defined in clause(a) below), make available or cause to be made available sufficient Funds to fulfill its Ownership Percentage of any unfulfilled Financial Obligation in excess of the applicable Self Insurance Amount and in accordance with the applicable Agreement, up to a maximum amount(the"Maximum Amount") not to exceed the Ownership Percentage multiplied by(i) US$75,000,000 less(ii)any amounts previously expended by GUARANTEED PARTY to any MUNICIPALITY or MUNICIPALITIES in excess of the Self Insurance Amount(s) with respect to the Financial Obligations, less (iii) any amounts previously paid under this Guarantee and any amounts previously paid or required to be paid under the Other Guarantees to any MUNICIPALITY or MUNICIPALITIES. Notwithstanding anything to the contrary herein, GUARANTOR shall under no circumstances be liable for more than US$34,500,000 in the aggregate to BENEFICIARY hereunder. All payments by GUARANTOR shall be made in lawful money of the United States of America. (a) In order for a MUNICIPALITY to exercise its rights under this Guarantee, such MUNICIPALITY must provide to GUARANTOR at GUARANTOR'S address set forth in Section 4.2 herein written notice,signed by an authorized representative or MUNICIPALITY(the "Notice"), of GUARANTEED PARTY's default with respect to the Financial Obligations under the applicable Agreement with such MUNICIPALITY,specifically setting forth: (i) the clause(s) that is (are) purported to have been defaulted on, (ii) that GUARANTEED PARTY has failed to make timely payment of all or any part of its Financial Obligations under such Agreement, (iii) a description of the unfulfilled Financial Obligations and the amount to be paid by GUARANTEED PARTY as a consequence of such default (the"Default Amount") multiplied by the Ownership Percentage(the"Guaranteed Amount"), (iv) that GUARANTEED PARTY has not paid to MUNICIPALITY the Default Amount, that GUARANTEED PARTY has been notified in writing by MUNICIPALITY, of such non-payment, and has been advised of MUNICIPALITY's intent to draw against this Guarantee and the Other Guarantees; and (v) a certification that MUNICIPALITY is simultaneously drawing against the Other Guarantees in an aggregate amount equal to the Default Amount less the Guaranteed Amount. (b) Payment under this Guarantee shall be made within fifteen(15) days after a MUNICIPALITY's presentation of a duly executed Notice. At such time, such 3 MUNICIPALITY will be entitled to receive from GUARANTOR payment in immediately available funds for the lesser of (i) the Maximum Amount and (ii) the Guaranteed Amount. Payment shall be made to MUNICIPALITY in the manner set forth in the Notice. Section 3.2. Waiver. Except as otherwise provided herein, GUARANTOR hereby waives; (a) notice of acceptance of this Guarantee; (b) notice of any modification, amendment, extension or waiver under any Agreement(except to the extent the Financial Obligations are reduced or changed thereby); (c) any failure, omission or delay on the part of any MUNICIPALITY to enforce,assert or exercise any right,power or remedy it has against the GUARANTEED PARTY; (d) the voluntary or involuntary liquidation, dissolution, sale or other disposition of all or substantially all the assets, marshalling of assets and liabilities, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition with creditors or readjustment of, or other similar proceedings affecting GUARANTOR or GUARANTEED PARTY or any of the respective assets of either of them, or any allegation or contest of the validity of this Guarantee in any such proceeding; and (c) any defense based upon any legal disability of GUARANTEED PARTY; provided, however, notwithstanding the foregoing, in any suit brought or demand made by any MUNICIPALITY against GUARANTOR to enforce its obligations under this Guarantee, GUARANTOR shall be entitled to assert any defense that would be available to the GUARANTEED PARTY it'an action had been brought by such MUNICIPALITY against the GUARANTEED PARTY. Notwithstanding anything to the contrary herein,GUARANTOR shall have no liability for any indirect,special,consequential,or punitive damages arising from or relating to this Guarantee or the transactions contemplated hereby, including without limitation any such damages that may result from or be attributable to a breach or default by GUARANTEED PARTY under any Agreement. Section 3.3. Costs. [fa MUNICIPALITY makes a legal claim against GUARANTOR and MUNICIPALITY wins the legal claim,GUARANTOR agrees to pay all costs,expenses and fees, including all reasonable attorneys' fees, which may be incurred by such MUNICIPALITY in enforcing or attempting to enforce this Guarantee following any default on the part of GUARANTOR hereunder, whether the same shall be enforced by suit or otherwise. ARTICLE IV MISCELLANEOUS Section 4.1. Governing Law and Dispute Resolution. This Guarantee shall be governed by, and construed in accordance with, the laws of the State of New York (excluding the choice of 4 law principles thereat). Any dispute between GUARANTOR and any MUNICIPALITY shall be resolved in accordance with the procedures set forth in the dispute resolution provisions (if any) found in the applicable Agreement. Section 4.2. Notices. All notices and other communications to GUARANTOR with respect to this Guarantee shall be electronically communicated or hand delivered at the address or facsimile transmission number as provided in this Section 4.2: All communications intended for GUARANTOR shall be sent to: Phillips 66 Pipeline LLC 2331 CityWest Blvd. Houston,TX 77042 Attn: Manager,Joint Ventures Fax Number: (918) 977-8688 or at any other address or facsimile transmission number of which GUARANTOR shall have notified each MUNICIPALITY in any manner prescribed in this Section 4.2. All communications intended for a MUNICIPALITY OR GUARANTEED PARTY shall be sent in accordance with the notice provisions of the applicable Agreement. For all purposes of this Guarantee, a notice or communication will he deemed effective: (a) if delivered by hand, (i) on the day it is delivered unless that day is not a Banking Day or (ii) if delivered after the close of business on a Banking Day, then on the next succeeding Banking Day, and (b) if sent by facsimile transmission,on the date transmitted, as evidenced by a facsimile confirmation sheet produced by the sender's facsimile machine, unless the date of transmission and confirmation is not a Banking Day,or the time of confirmation is after the close of business on such day, in which cases notice shall be effective on the next succeeding Banking Day. Section 4.3. Banking Days. Except as otherwise provided in this Guarantee, if any date on which a payment is to be made, notice is to be given or other action taken hereunder is not a Banking Day, then such payment, notice or other action shall be made,given or taken on the next succeeding Banking Day,and in the case of any payment, no interest shall accrue for the delay. Section 4.4. Successors and Assigns. This Guarantee shall be binding upon GUARANTOR and its successors and permitted assigns and inure to the benefit of each MUNICIPALITY and its permitted successors and assigns. GUARANTOR may not assign its obligations hereunder without the prior written consent of each MUNICIPALITY (not to be unreasonably withheld or delayed), provided that a MUNICIPALITY shall not be entitled to withhold acceptance of an assignee if the proposed assignee has a consolidated net worth of not less than five(5) times the Maximum Amount. No MUNICIPALITY may assign,sell, or transfer its rights or interests in this Guarantee except with the prior written consent of GUARANTOR(not to be unreasonably withheld or delayed). 5 Section 4,5. Guarantee for Benefit of BENEFICIARY. This Guarantee is entered into by GUARANTOR for the benefit of BENEFICIARY. Nothing contained herein shall be deemed to create any right in, or permit any Person to enforce or make any claim hereunder or to be in whole or in part for the benefit of any Person other than GUARANTOR, each MUNICIPALITY and their respective permitted successors and assigns. Section 4.6. Term. This Guarantee shall terminate automatically and be of no further force and effect with respect to a MUNICIPALITY upon the earliest of(a) the date on which the Maximum Amount under this Guarantee is reduced to US$D, (b)the date on which the applicable Agreement has expired or has otherwise been terminated in accordance with its terms and (c) the date on which GUARANTOR ceases to be a shareholder of GUARANTEED PARTY. For the avoidance of doubt, a Person shall no longer be deemed to be a MUNICIPALITY for purposes of this Guarantee upon the occurrence of the event set forth in clause(b)of the immediately preceding sentence or the removal of such Person from Schedule I in accordance with Section 4.7. Section 4.7. Amendments and Waivers. Any provision of this Guarantee may be amended or waived if, but only if, such amendment or waiver is in writing and is signed by GUARANTOR and acknowledged in writing by each MUNICIPALITY; provided,however,that in no event shall the acknowledgement of any MUNICIPALITY be required to amend Schedule I hereto in any respect (including, without limitation, to add any MUNICIPALITY), unless such amendment removes such MUNICIPALITY from Schedule i. GUARANTOR hereby agrees to deliver copies of all amendments of Schedule I hereto to each MUNICIPALITY at its address specified on such Schedule I, whether or not the acknowledgement or consent of such MUNICIPALITY is required. Section 4.8. Headings. The article and section headings of this Guarantee are for convenience only and shall not affect the construction hereof. Section 4.9. Partial Invalidity. The invalidity of any one or more phrases, sentences, clauses or sections in this Guarantee shall not affect the validity or enforceability of the remaining portions of this Guarantee or any part thereof. • Section 4.10 No Waiver, Remedies. No failure or delay by a MUNICIPALITY in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right,power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. Section 4.11 Entire Agreement. `Phis Guarantee constitutes the entire agreement and understanding of the parties with respect to the subject matter and supersedes all oral statements and prior writings with respect thereto. 7 IN WITNESS WHEREOF,GUARANTOR has caused this Guarantee to he executed in its name and on its behal Fby its respective duly authorized representatives as of the date first above written. PHILLIPS 66 PIPELIN By: Name. ,7u h A. Vincent Title: Vice President & Treasurer 8 FIRST AMENDMENT TO GAURANTEE This First Amendment to Guarantee(this "Amendment") is effective as of December 7, 2021 (the "Amendment Effective Date") and made by Phillips 66 Pipeline LLC, a Delaware limited liability company, with an office at 2331 CityWest Blvd., Houston Texas 77042 ("Guarantor"); RECITALS: WHEREAS, Guarantor previously executed that certain Guarantee dated effective as of September 14, 2020 (the "Guarantee") for the benefit of each Municipality and Beneficiary, as defined therein. WHEREAS,pursuant to Section 4.7 of the Guarantee,Guarantor now wishes to amend the Guarantee to delete Schedule I and replace it with Schedule I attached hereto. NOW,THEREFORE, in consideration of the premises set out herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged Guarantor does hereby agree as follows: DEFINITIONS 1.1 Definitions. Unless otherwise defined herein, capitalized terms used in this Amendment shall have the respective meanings ascribed to such terms in the Guarantee. ARTICLE II AMENDMENTS 2.1 Amendment to Schedule I. Schedule I of the Guarantee is hereby deleted in its entirety and replaced with the Beneficiary List attached hereto as Schedule I:. ARTICLE III GENERAL PROVISIONS 3.1 Effectiveness and Ratification. All of the provisions of this Amendment shall be effective as of the date hereof. Except as specifically provided for in this Amendment, the terms of the Guarantee shall remain in full force and effect. In the event of any conflict or inconsistency between the terms of this Amendment and the Guarantee, the terms of the Guarantee shall prevail and govern. 3.2 Entire Agreement. This Amendment, the schedule attached hereto and the Guarantee (as amended hereby) constitutes the full and entire understanding and agreement between the parties with respect to the subject matter hereof and thereof, and supersedes all prior or contemporaneous agreements,understandings,representations or warranties among the Parties, oral or written,other than those set forth or referred to herein. 3.3 Partial Invalidity. The invalidity of any one or more phrases, sentences, clauses or sections in this Amendment shall not affect the validity or enforceability of the remaining portions of this Amendment or any part thereof. 3.A Governing Law; Jurisdiction. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York (excluding the choice of law principles thereof). [Signature page follows.] First Amendment to Guarantee 2 IN WITNESS WHEREOF, Guarantor has caused this Amendment to be executed in its name and on its behalf by a duly authorized representative, effective as of the Amendment Effective Date. Phillips 66 Pipelin LLC By: Na Title: Vice President & Treasurer Date: fl r•pmhPr 15, 2021 W First Amendment to Guarantee SCHEDULE I BENEFICIARY LIST Municipality Name, Agreement Self Insurance Address&Telephone No. Amount City of Spokane Yellowstone Pipe Line Company $25,000,000 c/o the Office of the City Attorney Pipeline Franchise Agreement 808 W.Spokane Falls Blvd. City of Spokane ORD C35924 Spokane,WA 99201-3326 509-755-2489 City of Spokane Valley Yellowstone Pipe Line Company $25,000,000 d/o the Office of the City Attorney Pipeline Franchise Agreement 10210 East Sprague Avenue City of Spokane Valley Spokane Valley,WA 99206 ORD 21-022 Phone: (509)720-5150 First Amendment to Guarantee