Contract analysis

I. Executive Summary and Purpose This memorandum has been prepared in connection with the comprehensive review and refresh of the corporate bylaws and board committee structure of Cascade Retail Holdings Inc. ("CRH" or the "Company"), a Delaware corporation publicly traded on the Nasdaq Stock Market under the ticker symbol "CRHI," with its principal executive offices located at 4800 Lakeview Blvd, Suite 1100, Bellevu

1. Officer Exculpation under Amended DGCL § 102(b)(7). The 2022 amendment to Section 102(b)(7) of the Delaware General Corporation Law (the "DGCL"), which became effective on August 1, 2022, extended the permissive scope of charter-based exculpation provisions to cover certain senior corporate officers. This amendment has direct implications for CRH's Restated Certificate of Incorporation and presents an opportunity

2. Caremark Oversight Duty Developments. Recent decisions of the Delaware Court of Chancery — principally In re McDonald's Corp. Stockholder Derivative Litigation (Del. Ch. 2023) and In re Harborview & Co. Derivative Litigation (Del. Ch. 2021) — have significantly expanded the practical scope and application of the fiduciary duty of oversight first articulated in In re Caremark International Inc. Derivative Litigatio

3. DGCL § 110 Emergency Bylaws. Section 110 of the DGCL authorizes Delaware corporations to adopt emergency bylaws that become operative during conditions that render normal corporate governance procedures impracticable. CRH's current bylaws do not include emergency bylaws provisions, and adoption of such provisions is recommended as part of the current bylaws refresh. As background, CRH's Restated Certificate of Inc

II. DGCL § 102(b)(7) — Officer Exculpation A. Background: Director Exculpation Under Pre-2022 Law The historical framework for exculpation of corporate fiduciaries in Delaware traces to the Delaware legislature's 1986 enactment of DGCL § 102(b)(7), which was a direct legislative response to the Delaware Supreme Court's decision in Smith v. Van Gorkom, 488 A.2d 858 (Del. 1985). In Van Gorkom, the Supreme Court held th

III. Heightened Caremark Oversight Duties — Recent Case Law A. Foundation: *In re Caremark International Inc. Derivative Litigation* (Del. Ch. 1996) and *Stone v. Ritter* (Del. 2006) The fiduciary duty of oversight — sometimes referred to as the "Caremark duty" — imposes upon corporate directors an obligation to make a good faith effort to oversee the corporation's operations and to ensure that adequate information a

1. Compensation & Human Capital Committee Charter. CRH's existing Compensation Committee charter (last revised March 2021) does not include explicit human capital management oversight responsibilities, workplace culture monitoring, or employee conduct oversight. In light of McDonald's, the revised charter should include an express mandate for the committee to oversee the Company's human capital management practices,

2. Nominating & Corporate Governance Committee Charter. The McDonald's decision reinforces the importance of board-level oversight of environmental, social, and governance ("ESG") and sustainability matters, particularly the "social" component of ESG, which encompasses human capital management, workforce diversity, and community impact. CRH's existing Nominating & Corporate Governance Committee charter (last revised

1. Audit Committee Charter Current Status: Chaired by Sandra Chen-Watkins; 4 independent members; charter last revised February 2020. The revised Audit Committee charter should include the following enhancements: • Caremark-Informed Compliance Oversight Language. The charter should include an explicit mandate for oversight of enterprise risk management, legal and regulatory compliance, and the adequacy of the Company

2. Compensation & Human Capital Committee Charter Current Status: Chaired by Robert "Rob" Elliston; 3 independent members; charter last revised March 2021. The revised charter should include the following enhancements: • Human Capital Management Oversight. Directly responsive to the McDonald's decision, the charter should include an explicit mandate for oversight of the Company's human capital management practices, i

3. Nominating & Corporate Governance Committee Charter Current Status: Chaired by Margaret "Meg" Holliday; 3 independent members; charter last revised January 2019. The revised charter should include the following enhancements: • ESG/Sustainability Oversight Mandate. The charter should include an explicit mandate for oversight of the Company's ESG and sustainability strategy and practices, including both environmenta

4. Technology & Cybersecurity Committee Charter (New Standing Committee) Current Status: No formal committee exists. An ad hoc Technology & Innovation Committee was formed by board resolution on September 15, 2022, without a written charter. Dr. Anwar Farouk has been designated as an initial member. The new charter should include the following elements: • Formalization as a Standing Committee. The charter should form

IV. DGCL § 110 — Emergency Bylaws A. Statutory Framework

Section 110 of the DGCL authorizes Delaware corporations to adopt emergency bylaws that become operative during an "emergency," which is defined as any condition that makes it not practicable for the corporation to conduct its business in conformity with its regular bylaws. The concept of an "emergency" under Section 110 is broadly construed and may encompass a wide range of circumstances, including natural disasters

Section 110 further provides that no officer, director, employee, or agent of the corporation shall be liable for actions taken in good faith in accordance with emergency bylaws. This statutory safe harbor provides important protection for fiduciaries who are called upon to make difficult decisions under emergency conditions, when perfect compliance with regular governance procedures may be impossible. B. Current CRH

V. Interaction of Legal Developments with CRH's Broader Governance Refresh A. Context: The 2023 Contested Election and Activist Engagement The current governance refresh engagement was prompted by several catalysts, the most significant of which were the contested director election at CRH's June 8, 2023 Annual Meeting of Stockholders and the subsequent activist engagement by Ridgepoint Capital Partners LP. A brief re