ARCHIVED REPORTS_2010 ANNUAL REPORT

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Nestle USA, Inc., Ripon, California March 31, 2011 2010 Annual Report 2.2 GROUNDWATER INVESTIGATION In September 2010, ECM conducted a CPT investigation in the vicinity of well M-1 OA to assess the causes of recent increases in concentrations of COCs. ECM completed subsurface lithology and groundwater investigation activities at 14 CPT boring location S4. Investigation details and action taken can be found in Section 3.1.6. Based on the evaluation of the 2010 data and historical information for M-10A, ECM recommended commencing groundwater extraction from well EI-1 at the Site. On October 29, field personnel optimized well EI-1 to run at 90 gallons per minute (gpm) concurrently with wells EU-3 and EU-4, both running at 31 gpm. Since these three wells are all completed in the Upper Aquifer, the total groundwater extraction rate of 152 gpm applies to the A-zone of the Upper Aquifer. Wells EI-1, EU-3 and EU-4 have continued to operate at these rates since October 29, 2010. Section 4.1.1 provides additional information regarding the start-up of EI-1. 2.3 GROUNDWATER MONITORING Nestle completed the following activities in 2010 as part of the groundwater monitoring efforts: 1. ECM submitted the 2009 Annual Reports to the RWQCB on March 31, 2010 pursuant to the MRP requirements. 2. ECM submitted the First, Second and Third Quarter Site Status reports to the RWQCB on May 14, August 13, and November 15, 2010 respectively, as required by the MRP. 3. In 2010, ECM's field staff conducted a quarterly inspection of the physical condition of all Nestle-owned monitoring wells to ensure that the well casings are locked and in good condition. Some wells required attention. The corrective actions are further discussed in Section 3.1.6. 4. On May 1, 2010, Nestle implemented monitoring and sampling in accordance with MRP R5-2010-0810. 2.4 INTERIM REMEDIAL ACTION PLAN SYSTEM PERFORMANCE Remediation of TCE impacted groundwater at the 230 Industrial Avenue location (the On-Site extraction and treatment system) continues pursuant to the approved IRAP (mass removal and migration control). The following activities were conducted in 2010: 1. ECM monitored and assessed the IRAP system performance by monitoring pumping rates and calculating mass removal rates on a monthly basis, and by evaluating the hydraulic containment periodically. 2. On May 4, 2010, ECM initiated a 72-hour shut-down test of the Industrial Avenue groundwater extraction and treatment system. The purpose of this test was to collect groundwater elevation data for the existing and new monitoring wells (M-50A and M- 51A) and to estimate the hydraulic capture zone for extraction wells EU-3 and EU-4. Section 4.1.2 and Section 5.3 provide details of this test. 2.5 2011 REVISED FEASIBILITY STUDY Following the submittal of the 2009 Revised FS report, the RWQCB requested additional information regarding: 1. the detailed evaluation of remediation technologies used for all zones impacted by the presence of COCs onsite and offsite, and 4