1038-00002 · Cascade Retail Holdings · documents

borrowers-counsel-legal-opinion.docx DOCUMENT Finance & Banking

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CALDERWOOD & HARKNESS LLP Attorneys at Law

599 Lexington Avenue, 42nd Floor New York, New York 10022 Telephone: (212) 506-7000 Facsimile: (212) 506-7070 www.calderwoodharkness.com

May 19, 2023

Crescent Harbor Bank, National Association, as Administrative Agent and Collateral Agent 780 Park Avenue, 30th Floor New York, New York 10021

and

Each of the Lenders party to the Credit Agreement referenced below:

Crescent Harbor Bank, N.A. Northgate Capital Bank Bridgevale Financial Corporation

Ladies and Gentlemen:

We have acted as counsel to Cascade Retail Holdings Inc., a corporation duly incorporated under the laws of the State of Delaware ("CRH" or the "Borrower"), and Cascade Retail Operating Company LLC, a limited liability company duly formed under the laws of the State of Delaware ("CROC" or the "Co-Borrower," and together with CRH, the "Borrowers"), in connection with that certain Credit Agreement dated as of May 4, 2023 (effective May 19, 2023) (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement") among the Borrowers, Cascade Digital Commerce Inc., a corporation incorporated under the laws of the State of Delaware ("CDC"), Cascade Outlet Stores LLC, a limited liability company formed under the laws of the State of Washington ("COS"), and Cascade Fulfillment Services Inc., a corporation incorporated under the laws of the State of Delaware ("CFS," and together with CDC and COS, collectively the "Guarantors"), the Lenders party thereto from time to time (the "Lenders"), and Crescent Harbor Bank, N.A., in its capacity as Administrative Agent and Collateral Agent (in such capacities, the "Agent"). CRH, CROC, CDC, COS, and CFS are referred to herein collectively as the "Loan Parties" and each individually as a "Loan Party."

The Credit Agreement provides for a $300,000,000 Senior Secured Asset-Based Revolving Credit Facility (the "ABL Facility") in favor of the Borrowers, secured by the assets of the Loan Parties as more particularly described in the Loan Documents (as defined below).

This opinion letter is delivered to you pursuant to Section 4.01(h) of the Credit Agreement as a condition precedent to the initial extensions of credit thereunder on the date hereof.

1. Documents Examined; Loan Documents Defined

In connection with the opinions expressed herein, we have examined executed originals, or copies certified or otherwise identified to our satisfaction, of the following documents (collectively, the "Loan Documents"):

1. The Credit Agreement dated as of May 4, 2023 (effective May 19, 2023), among the Borrowers, the Guarantors, the Lenders, and the Agent.

2. The Guaranty Agreement dated as of May 4, 2023 (the "Guaranty Agreement"), executed by CDC, COS, and CFS (each as a "Guarantor" and collectively as the "Guarantors") in favor of the Agent for the benefit of the Secured Parties (as defined in the Credit Agreement).

3. The Security Agreement dated as of May 4, 2023 (the "Security Agreement"), among the Loan Parties, as Grantors, and the Agent, as Collateral Agent for the benefit of the Secured Parties.

4. The Pledge Agreement dated as of May 4, 2023 (the "Pledge Agreement"), by CRH (pledging 100% of the issued and outstanding equity interests in CROC) and by CROC (pledging 100% of the issued and outstanding equity interests in each of CDC, COS, and CFS, and 65% of the voting equity interests in Cascade Retail Canada ULC, a British Columbia unlimited liability company), in each case in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties.

5. Revolving Loan Promissory Note dated May 4, 2023, executed by the Borrowers in the stated principal amount of $135,000,000, payable to the order of Crescent Harbor Bank, N.A.

6. Revolving Loan Promissory Note dated May 4, 2023, executed by the Borrowers in the stated principal amount of $90,000,000, payable to the order of Northgate Capital Bank.

7. Revolving Loan Promissory Note dated May 4, 2023, executed by the Borrowers in the stated principal amount of $75,000,000, payable to the order of Bridgevale Financial Corporation.

8. Swingline Promissory Note dated May 4, 2023, executed by the Borrowers in the stated principal amount of up to $25,000,000, payable to the order of Crescent Harbor Bank, N.A., in its capacity as Swingline Lender.

9. The Perfection Certificate dated May 4, 2023 (the "Perfection Certificate"), executed by each of the Loan Parties and delivered to the Agent.

10. Each Deposit Account Control Agreement dated May 19, 2023 (collectively, the "DACAs"), including the following:

(a) Deposit Account Control Agreement among CRH, as account holder, Meridian Trust Company, N.A. (1001 Fourth Avenue, Suite 500, Seattle, Washington 98154), as depository bank, and the Agent, as Collateral Agent;

(b) Deposit Account Control Agreement among CROC, as account holder, and Crescent Harbor Bank, N.A. (acting in its dual capacity as depository bank and as Collateral Agent);

(c) Deposit Account Control Agreement among CRH, as account holder, and Crescent Harbor Bank, N.A. (acting in its dual capacity as depository bank and as Collateral Agent), with respect to the concentration account designated for the receipt of collections on accounts receivable;

(d) Deposit Account Control Agreement among CDC, as account holder, Northgate Capital Bank, as depository bank, and the Agent, as Collateral Agent.

The Loan Documents described above, together with all schedules, exhibits, annexes, and ancillary documents delivered in connection therewith and such other documents as we have reviewed in connection with the preparation of this opinion, are referred to herein collectively as the "Transaction Documents."

2. Other Documents and Items Examined

In addition to the Loan Documents, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following documents and other items:

1. The Certificate of Incorporation of CRH (including all certificates of amendment and certificates of designations thereto), as certified by the Secretary of State of the State of Delaware as of a recent date.

2. The Bylaws of CRH, as currently in effect, as certified by the Secretary of CRH.

3. The Certificate of Formation of CROC, as certified by the Secretary of State of the State of Delaware as of a recent date.

4. The Limited Liability Company Agreement of CROC, as currently in effect, as certified by an authorized representative of CROC.

5. The Certificate of Incorporation of CDC (including all certificates of amendment thereto), as certified by the Secretary of State of the State of Delaware as of a recent date.

6. The Bylaws of CDC, as currently in effect, as certified by the Secretary of CDC.

7. The Certificate of Formation of COS, as certified by the Secretary of State of the State of Washington as of a recent date.

8. The Operating Agreement of COS, as currently in effect, as certified by an authorized representative of COS.

9. The Certificate of Incorporation of CFS (including all certificates of amendment thereto), as certified by the Secretary of State of the State of Delaware as of a recent date.

10. The Bylaws of CFS, as currently in effect, as certified by the Secretary of CFS.

11. Resolutions of the Board of Directors of CRH, duly adopted at a meeting held on February 27, 2023, authorizing the execution and delivery of the Loan Documents and the consummation of the transactions contemplated thereby, including the borrowing under the ABL Facility in an aggregate principal amount of up to $300,000,000, and designating Nathaniel Voss (Chief Executive Officer) and Elena Kowalski (Chief Financial Officer) as authorized signatories with respect to the Loan Documents, as certified by the Secretary's Certificate of CRH dated May 19, 2023.

12. Member resolutions of CROC, duly adopted by written consent of its sole member, authorizing the execution, delivery, and performance by CROC of the Loan Documents to which CROC is a party and the transactions contemplated thereby, as certified by an authorized representative of CROC.

13. Resolutions of the Board of Directors of CDC and CFS, and member resolutions of COS, in each case duly adopted and authorizing the execution, delivery, and performance by each such Guarantor of the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which such Guarantor is a party, as certified by the respective Secretary's Certificates or authorized representative certificates of each such Guarantor.

14. Secretary's Certificates (including incumbency certificates) of CRH, CROC, CDC, COS, and CFS, each dated May 19, 2023, certifying as to the incumbency and specimen signatures of the officers or authorized representatives of each Loan Party who executed the Loan Documents on behalf of such Loan Party.

15. Officer's Certificate of the Borrower dated May 19, 2023, executed by Elena Kowalski, Chief Financial Officer of CRH, certifying as to, among other things, the accuracy and completeness of the representations and warranties set forth in the Credit Agreement, the absence of any default or event of default thereunder, and compliance with the conditions precedent to the initial extensions of credit under the Credit Agreement.

16. Good standing certificates for each Loan Party from the relevant Secretary of State, as follows: (a) certificates of good standing for CRH, CROC, CDC, and CFS, each issued by the Secretary of State of the State of Delaware; and (b) a certificate of good standing for COS issued by the Secretary of State of the State of Washington, each dated within five (5) business days of the date hereof.

17. UCC-1 financing statements filed with the applicable filing offices, as follows:

(a) UCC-1 financing statement filed with the Secretary of State of the State of Delaware naming CRH as debtor and Crescent Harbor Bank, N.A., as Collateral Agent, as secured party (filing no. 2023-1947291);

(b) UCC-1 financing statement filed with the Secretary of State of the State of Delaware naming CROC as debtor and Crescent Harbor Bank, N.A., as Collateral Agent, as secured party (filing no. 2023-1947283); and

(c) UCC-1 financing statement filed with the Secretary of State of the State of Washington naming COS as debtor and Crescent Harbor Bank, N.A., as Collateral Agent, as secured party (filing no. 2023-204-8176).

18. UCC, tax lien, and judgment search results for each Loan Party in their respective jurisdictions of organization, as conducted by Capitol Lien Records & Research, Inc. and delivered to us on or about May 15, 2023 (collectively, the "Lien Search Results").

19. UCC-3 termination statements terminating all existing UCC-1 financing statements of record filed by or on behalf of Harborview Lending Group, LLC, as secured party, against each of the Loan Parties, as applicable, reflecting the termination of all security interests of Harborview Lending Group, LLC in the assets of the Loan Parties.

20. Such other certificates, documents, agreements, corporate and company records, and instruments as we have deemed necessary or appropriate for purposes of rendering the opinions expressed herein.

3. Assumptions

In rendering the opinions expressed herein, we have, with your consent, assumed the following, without independent investigation or verification:

1. The genuineness of all signatures on all documents examined by us (other than the signatures of the officers and authorized representatives of the Loan Parties, as to which we have relied on the Secretary's Certificates and incumbency certificates described in Section 2 above).

2. The authenticity of all documents submitted to us as originals, the conformity to authentic originals of all documents submitted to us as copies (whether certified, photostatic, facsimile, electronic, or otherwise), and the authenticity of the originals of such copies.

3. Each natural person who executed any of the Loan Documents on behalf of any party thereto (other than the Loan Parties) had the legal capacity to do so at the time of execution.

4. Each party to the Loan Documents (other than the Loan Parties) is duly organized or formed, validly existing, and in good standing under the laws of its jurisdiction of organization or formation, and is duly qualified to do business in each jurisdiction where the conduct of its business or the ownership or leasing of its properties requires such qualification.

5. Each party to the Loan Documents (other than the Loan Parties) has full power, authority, and legal right to execute, deliver, and perform its respective obligations under each of the Loan Documents to which it is a party, and such execution, delivery, and performance have been duly authorized by all requisite action on the part of such party.

6. Each of the Loan Documents has been duly authorized, executed, and delivered by each party thereto (other than the Loan Parties) and constitutes the legal, valid, and binding obligation of each such party.

7. Each of the Loan Documents constitutes the legally valid and binding obligation of each party thereto (other than the Loan Parties), enforceable against each such party in accordance with its terms, subject to applicable bankruptcy, insolvency, and similar laws affecting creditors' rights generally and to general principles of equity.

8. The Credit Agreement and the related Loan Documents accurately describe the understanding and agreement of the parties thereto with respect to the transactions contemplated thereby, and no terms or conditions exist with respect to such transactions that are not reflected in the Loan Documents.

9. There has been no mutual mistake of fact or misunderstanding, fraud, duress, or undue influence with respect to any of the Loan Documents or the transactions contemplated thereby.

10. The proceeds of the loans made under the Credit Agreement will be used for lawful and proper corporate purposes of the Borrowers, including working capital and general corporate purposes, and not in violation of Regulations T, U, or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221, and 224, respectively), and no portion of such proceeds will be used, directly or indirectly, to purchase or carry any "margin stock" (as defined in Regulation U) or to extend credit for the purpose of purchasing or carrying any margin stock.

11. Each Loan Party has filed all required federal, state, and local tax returns and has paid all taxes, assessments, and governmental charges due and payable by it, except as disclosed in the Officer's Certificate or the Credit Agreement.

12. All factual matters stated in the Officer's Certificate dated May 19, 2023, the Secretary's Certificates dated May 19, 2023, the Perfection Certificate dated May 4, 2023, and all other certificates and documents delivered by the Loan Parties to us or to the Agent in connection with the transactions contemplated by the Credit Agreement are true, correct, and complete as of the date hereof, and no facts or circumstances exist that would render any such factual statements inaccurate or misleading.

13. The description of the collateral contained in the Security Agreement and in each UCC-1 financing statement referenced in Section 2(17) above is sufficient under Article 9 of the Uniform Commercial Code, as in effect in the applicable jurisdiction, to create and perfect a security interest in the personal property described therein, and such descriptions reasonably identify the collateral within the meaning of Section 9-108 of the Uniform Commercial Code.

14. Value has been given by the Lenders for the security interests granted under the Security Agreement and the Pledge Agreement, and each Loan Party has rights in the collateral described therein or the power to transfer rights therein to the Agent, as Collateral Agent, within the meaning of Section 9-203 of the Uniform Commercial Code.

4. Opinions

Based upon and subject to the foregoing, and subject further to the qualifications and exceptions set forth in Section 5 below, we are of the opinion that:

4.1 Due Organization and Good Standing

(a) CRH is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware.

(b) CROC is a limited liability company duly formed, validly existing, and in good standing under the laws of the State of Delaware.

(c) CDC is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware.

(d) COS is a limited liability company duly formed, validly existing, and in good standing under the laws of the State of Washington.

(e) CFS is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware.

With respect to the opinions expressed in this Section 4.1, we have relied solely upon the good standing certificates issued by the Secretary of State of the State of Delaware (with respect to CRH, CROC, CDC, and CFS) and the Secretary of State of the State of Washington (with respect to COS), each dated within five (5) business days of the date hereof, and upon our review of the organizational documents described in Section 2 above. We express no opinion as to the qualification of any Loan Party to do business in any jurisdiction other than its jurisdiction of organization.

4.2 Power and Authority

(a) Each of CRH and CROC, in its capacity as a Borrower, has all requisite corporate or limited liability company power and authority to (i) execute and deliver the Loan Documents to which it is a party, (ii) borrow under the Credit Agreement and incur the obligations evidenced by the Revolving Loan Notes and the Swingline Note, (iii) grant the security interests and pledges contemplated by the Security Agreement and the Pledge Agreement, and (iv) perform its obligations under the Loan Documents to which it is a party.

(b) Each of CDC, COS, and CFS, in its capacity as a Guarantor, has all requisite corporate or limited liability company power and authority to (i) execute and deliver the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which it is a party, (ii) guarantee the payment and performance of all Obligations (as defined in the Credit Agreement) pursuant to the Guaranty Agreement, (iii) grant the security interests contemplated by the Security Agreement and the Pledge Agreement (to the extent applicable), and (iv) perform its obligations under the Loan Documents to which it is a party.

4.3 Due Authorization

The execution, delivery, and performance by each Loan Party of each of the Loan Documents to which such Loan Party is a party, and the consummation of the transactions contemplated thereby, have been duly authorized by all requisite corporate or limited liability company action on the part of such Loan Party. Without limiting the generality of the foregoing:

(a) The Board of Directors of CRH, by resolutions duly adopted at a meeting held on February 27, 2023, authorized the entry into the $300,000,000 ABL Facility and the execution, delivery, and performance of the Loan Documents by CRH, and designated Nathaniel Voss, Chief Executive Officer, and Elena Kowalski, Chief Financial Officer, as authorized signatories with respect to the Loan Documents and any certificates, instruments, or other documents to be delivered in connection therewith.

(b) The sole member of CROC, by written consent effective as of February 27, 2023, authorized the execution, delivery, and performance by CROC of the Loan Documents to which CROC is a party and the consummation of the transactions contemplated thereby.

(c) The Board of Directors of CDC, by resolutions duly adopted by written consent effective as of February 27, 2023, authorized the execution, delivery, and performance by CDC of the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which CDC is a party. The Board of Directors of CFS, by resolutions duly adopted by written consent effective as of February 27, 2023, authorized the execution, delivery, and performance by CFS of the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which CFS is a party. The sole member of COS, by written consent effective as of February 27, 2023, authorized the execution, delivery, and performance by COS of the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which COS is a party.

No stockholder or member vote or consent is required under applicable law, the certificate of incorporation, bylaws, certificate of formation, limited liability company agreement, operating agreement, or other organizational documents of any Loan Party, or under any agreement or instrument to which any Loan Party is a party or by which any Loan Party or its properties is bound, for the execution, delivery, and performance by such Loan Party of the Loan Documents to which it is a party or the consummation of the transactions contemplated thereby.

4.4 Execution and Delivery

Each Loan Document has been duly executed and delivered by each Loan Party that is a party thereto. In rendering this opinion, we have relied upon the Secretary's Certificates and incumbency certificates described in Section 2(14) above with respect to the identity and authority of the officers and authorized representatives who executed the Loan Documents on behalf of each Loan Party.

4.5 Enforceability. Each Loan Document to which a Loan Party is a party constitutes the legal, valid, and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its terms. Without limiting the generality of the foregoing, and subject to the qualifications set forth in Section 5 below:

(a) The Credit Agreement constitutes the legal, valid, and binding obligation of each Borrower and each Guarantor party thereto, enforceable in accordance with its terms, including, without limitation, (i) the obligation of the Borrowers to repay all Revolving Loans at the applicable interest rate of Adjusted Term SOFR plus 300 basis points per annum (subject to the applicable margin pricing grid), (ii) the obligation of the Borrowers to repay all Revolving Loans and other Obligations in full on the Maturity Date of May 19, 2028, (iii) the springing Financial Covenant requiring maintenance of a minimum Fixed Charge Coverage Ratio of not less than 1.10 to 1.00 for each Testing Period during a Trigger Period (as each such term is defined in the Credit Agreement), and (iv) all other obligations, covenants, representations, warranties, and agreements of the Borrowers and the Guarantors contained therein.

(b) The Guaranty Agreement constitutes the legal, valid, and binding obligation of each Guarantor (CDC, COS, and CFS), enforceable in accordance with its terms, including the unconditional and irrevocable guaranty by each Guarantor of the prompt and complete payment and performance when due of all Obligations of the Borrowers under the Credit Agreement and the other Loan Documents.

(c) The Security Agreement constitutes the legal, valid, and binding obligation of each Loan Party that is a Grantor thereunder, enforceable in accordance with its terms, including the grant by each Grantor of a first-priority security interest in all of such Grantor's right, title, and interest in and to the ABL Collateral (as defined therein) in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties, subject to Permitted Liens (as defined in the Credit Agreement).

(d) The Pledge Agreement constitutes the legal, valid, and binding obligation of CRH and CROC, enforceable in accordance with its terms, including the pledge by CRH of 100% of the issued and outstanding equity interests in CROC, and the pledge by CROC of 100% of the issued and outstanding equity interests in each of CDC, COS, and CFS, and 65% of the voting equity interests in Cascade Retail Canada ULC.

(e) Each Revolving Loan Promissory Note constitutes the legal, valid, and binding obligation of the Borrowers, enforceable in accordance with its terms, including the Revolving Loan Promissory Note in the stated principal amount of $135,000,000 payable to the order of Crescent Harbor Bank, N.A., the Revolving Loan Promissory Note in the stated principal amount of $90,000,000 payable to the order of Northgate Capital Bank, and the Revolving Loan Promissory Note in the stated principal amount of $75,000,000 payable to the order of Bridgevale Financial Corporation.

(f) The Swingline Promissory Note in the stated principal amount of up to $25,000,000, payable to the order of Crescent Harbor Bank, N.A. in its capacity as Swingline Lender, constitutes the legal, valid, and binding obligation of the Borrowers, enforceable in accordance with its terms.

The enforceability opinions set forth in this Section 4.5 are subject to the qualifications and exceptions set forth in Section 5 below.

4.6 No Conflicts

The execution, delivery, and performance by each Loan Party of the Loan Documents to which such Loan Party is a party, and the consummation of the transactions contemplated thereby (including the borrowings under the Credit Agreement, the granting of the security interests and pledges under the Security Agreement and the Pledge Agreement, and the guarantees under the Guaranty Agreement), do not and will not:

(a) Violate or conflict with the certificate of incorporation, bylaws, certificate of formation, limited liability company agreement, operating agreement, or other organizational documents of such Loan Party;

(b) Violate or conflict with any law, statute, rule, or regulation of the State of New York, the State of Delaware, or the federal laws of the United States applicable to such Loan Party (to the extent addressed in this opinion and subject to the limitations set forth in Section 5.7 below);

(c) Result in a breach of, or constitute a default (or an event that, with the giving of notice or lapse of time or both, would constitute a default) under, any material agreement or instrument listed on Schedule 5.04 to the Credit Agreement to which such Loan Party is a party or by which such Loan Party or any of its properties is bound (it being understood that our opinion in this clause (c) is rendered without independent investigation, based solely on our review of the agreements identified to us by the Loan Parties and listed on Schedule 5.04 to the Credit Agreement, and upon the representations and warranties of the Loan Parties in the Officer's Certificate and the Credit Agreement); or

(d) Result in or require the creation or imposition of any lien, charge, pledge, security interest, or other encumbrance upon any property or assets of any Loan Party, other than the liens and security interests created under the Security Agreement and the Pledge Agreement in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties, and the Permitted Liens (as defined in the Credit Agreement).

4.7 No Governmental Approvals Required

No consent, approval, authorization, order, registration, qualification, license, or filing with, or other action by, any governmental authority or regulatory body of the United States, the State of New York, the State of Delaware, or the State of Washington is required for the execution, delivery, or performance by any Loan Party of any Loan Document to which such Loan Party is a party, or for the validity or enforceability thereof, or for the creation or perfection of the security interests and pledges contemplated by the Security Agreement and the Pledge Agreement, except:

(a) The filing of UCC-1 financing statements with the Secretary of State of the State of Delaware (with respect to CRH and CROC as debtors) and the Secretary of State of the State of Washington (with respect to COS as debtor), which filings have been duly made as described in Section 2(17) above;

(b) Such filings and registrations as may be required under federal or state securities laws in connection with the issuance of the Revolving Loan Notes and the Swingline Note, which Notes are exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof and are exempt from the registration or qualification requirements of applicable state securities laws; and

(c) Such other filings, consents, approvals, and authorizations as have already been obtained or made and are in full force and effect as of the date hereof.

4.8 Creation of Security Interests

(a) The Security Agreement creates in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties, a valid security interest in all right, title, and interest of each Grantor (as defined in the Security Agreement) in and to the collateral described therein (the "ABL Collateral"), to the extent that a security interest therein can be created under Article 9 of the Uniform Commercial Code as in effect in the State of New York (the "NY UCC") and the Uniform Commercial Code as in effect in the State of Delaware (the "DE UCC"). The ABL Collateral includes, without limitation, all of each Grantor's right, title, and interest in and to:

(i) all accounts receivable (whether now existing or hereafter arising);

(ii) all inventory (including, without limitation, all raw materials, work-in-process, finished goods, goods in transit, and distribution center inventory);

(iii) all deposit accounts (subject to perfection by "control" as described in Section 4.9 below);

(iv) all supporting obligations;

(v) all chattel paper (whether tangible or electronic);

(vi) all instruments;

(vii) all letter-of-credit rights;

(viii) all commercial tort claims (to the extent specifically identified in the Security Agreement or any supplement thereto);

(ix) all general intangibles (including, without limitation, payment intangibles and software); and

(x) all proceeds (as defined in Section 9-102(a)(64) of the NY UCC) of any and all of the foregoing, including, without limitation, cash proceeds, insurance proceeds, and all products thereof.

(b) The Pledge Agreement creates in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties, a valid security interest in all right, title, and interest of CRH and CROC (each as a "Pledgor") in and to the pledged equity interests described therein, including (i) 100% of the issued and outstanding equity interests of CROC held by CRH, (ii) 100% of the issued and outstanding equity interests of each of CDC, COS, and CFS held by CROC, and (iii) 65% of the voting equity interests in Cascade Retail Canada ULC held by CROC, together with all distributions, dividends, cash, instruments, and other property from time to time received, receivable, or otherwise distributed in respect of or in exchange for any or all of such pledged equity interests, and all proceeds thereof.

4.9 Perfection of Security Interests

(a) Upon the filing of the UCC-1 financing statements with (i) the Secretary of State of the State of Delaware naming CRH as debtor (filing no. 2023-1947291), (ii) the Secretary of State of the State of Delaware naming CROC as debtor (filing no. 2023-1947283), and (iii) the Secretary of State of the State of Washington naming COS as debtor (filing no. 2023-204-8176), in each case naming Crescent Harbor Bank, N.A., as Collateral Agent, as the secured party, the security interests created under the Security Agreement in personal property collateral in which a security interest may be perfected by filing a UCC-1 financing statement under Article 9 of the applicable Uniform Commercial Code have been perfected. Such perfected security interests constitute first-priority security interests in such collateral, subject only to (i) Permitted Liens (as defined in the Credit Agreement), and (ii) liens and encumbrances that have priority by operation of applicable law (including, without limitation, purchase-money security interests that comply with the requirements of UCC Section 9-324, tax liens, statutory liens, and mechanics' and materialmen's liens).

(b) Perfection of a security interest in deposit accounts as "original collateral" (as distinguished from deposit accounts as proceeds of other collateral) requires "control" by the secured party within the meaning of Section 9-104 of the Uniform Commercial Code. The DACAs executed on May 19, 2023, with respect to four deposit accounts—two maintained at Crescent Harbor Bank, N.A., one maintained at Northgate Capital Bank, and one maintained at Meridian Trust Company, N.A. (1001 Fourth Avenue, Suite 500, Seattle, Washington 98154)—are intended to establish such "control" within the meaning of Section 9-104 of the applicable Uniform Commercial Code. Assuming that each depository bank named in the DACAs has agreed to comply with the instructions originated by the Agent directing disposition of the funds in such deposit accounts without further consent of the applicable Loan Party (or, in the case of Crescent Harbor Bank, N.A. acting in its dual capacity as depository bank and Collateral Agent, that such control is established by virtue of the Agent's status as the customer's bank within the meaning of Section 9-104(a)(1) of the UCC), the security interest of the Agent in such deposit accounts has been perfected by "control."

(c) Perfection of the security interest in the pledged equity interests in CROC (a Delaware limited liability company, the equity interests of which are not represented by certificates) is achieved by filing a UCC-1 financing statement in the State of Delaware. To the extent that any equity interests pledged under the Pledge Agreement are represented by certificates (including, without limitation, equity interests in CDC and CFS to the extent represented by stock certificates), perfection of the security interest therein requires delivery of such certificates to the Agent, as Collateral Agent, together with duly executed stock powers or transfer powers endorsed in blank. We have been informed by officers of the Loan Parties, and we assume for purposes of this opinion, that such delivery has been accomplished as of the date hereof with respect to all certificated equity interests subject to the Pledge Agreement.

(d) With respect to the pledge by CROC of 65% of the voting equity interests in Cascade Retail Canada ULC, a British Columbia unlimited liability company, we express no opinion regarding the creation, validity, perfection, or priority of any security interest in equity interests of a foreign entity except to the extent that such security interest may be perfected by the filing of a UCC-1 financing statement in the State of Delaware (the jurisdiction of CROC's location for purposes of Article 9 of the DE UCC). We note that applicable Canadian or British Columbia law may impose additional requirements for the creation, perfection, or enforcement of a security interest in equity interests of a British Columbia unlimited liability company, and we express no opinion with respect thereto.

5. Qualifications and Exceptions

The opinions expressed herein are subject to the following qualifications and exceptions:

5.1 Bankruptcy and Insolvency Qualification

The enforceability opinions expressed in Section 4.5 above and elsewhere in this opinion letter are subject to and limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium, receivership, conservatorship, fraudulent conveyance, fraudulent transfer, and similar laws affecting creditors' rights and remedies generally (including, without limitation, Title 11 of the United States Code (the "Bankruptcy Code"), the effect of statutory and other laws regarding fraudulent conveyances and preferential transfers, including Sections 544, 547, 548, and 550 of the Bankruptcy Code and Article 10 of the New York Debtor and Creditor Law), and (b) general principles of equity (including, without limitation, concepts of materiality, reasonableness, good faith, and fair dealing), regardless of whether considered in a proceeding in equity or at law (the limitations described in clauses (a) and (b) are collectively referred to herein as the "Enforceability Exceptions"). We express no opinion as to (i) the effect of any bankruptcy, insolvency, reorganization, moratorium, or similar proceeding on the enforceability of any provision of any Loan Document, (ii) the ability of any Loan Party or any trustee or receiver to assume, reject, or assign any Loan Document in any such proceeding, or (iii) whether any transfer or obligation incurred in connection with the transactions contemplated by the Loan Documents could be avoided or recovered under the Bankruptcy Code or any applicable state law.

5.2 Equitable Principles Qualification

The remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses (including, without limitation, the defenses of laches, estoppel, waiver, and unclean hands) and to the discretion of the court before which any proceeding therefor may be brought. We express no opinion as to whether or to what extent a court of competent jurisdiction would grant specific performance or other equitable relief with respect to any provision of any Loan Document.

5.3 Usury Qualification

We express no opinion as to the enforceability of any provision of any Loan Document to the extent that such provision constitutes or may constitute a penalty or forfeiture, or to the extent that the enforcement thereof may be limited or affected by federal or state usury laws. Notwithstanding the foregoing, based on the terms of the Credit Agreement and applicable New York law (including Section 5-501 of the New York General Obligations Law and Sections 190.40 and 190.42 of the New York Penal Law) and applicable federal law (including the exemption available to national banking associations under 12 U.S.C. § 85 and the regulations promulgated thereunder by the Office of the Comptroller of the Currency), the stated interest rate applicable to the Revolving Loans under the Credit Agreement—being Adjusted Term SOFR plus a spread of 300 basis points per annum—and the default rate of an additional 200 basis points per annum above such rate, do not, on their face, violate any applicable usury statute or regulation. This conclusion assumes that the calculations of interest under the Credit Agreement are performed in accordance with the provisions thereof and that no fees, charges, or other amounts that could be characterized as "interest" under applicable law cause the effective rate of interest to exceed the maximum rate permitted by applicable law.

5.4 Indemnification Qualification

The enforceability of provisions in the Loan Documents relating to indemnification, contribution, or exculpation may be limited by applicable law and public policy considerations, including, without limitation, (a) applicable federal and state securities laws (to the extent that any such indemnification provision purports to indemnify a party against liability arising under the Securities Act of 1933, as amended, or any state securities law), and (b) general principles of equity, including the principle that a party may not be indemnified against its own willful misconduct, gross negligence, fraud, or bad faith, or against liabilities arising from violations of public policy.

5.5 Choice of Law and Forum Selection Qualification

(a) The enforceability of provisions in the Loan Documents designating the laws of the State of New York as the governing law thereof may be subject to (i) the constitutional and statutory limitations of the jurisdiction whose law would be applicable in the absence of such choice of law provision, and (ii) Section 5-1401 of the New York General Obligations Law (which, by its terms, applies to agreements covering transactions involving aggregate consideration of not less than $250,000, and therefore applies to the Loan Documents). We note that a court in a jurisdiction other than New York may not give effect to such choice of law provisions if the application of New York law would be contrary to a fundamental public policy of such other jurisdiction.

(b) The enforceability of provisions in the Loan Documents selecting the United States District Court for the Southern District of New York or the Supreme Court of the State of New York, New York County, as the exclusive forum for the resolution of disputes arising under the Loan Documents may be limited by applicable procedural rules (including rules relating to venue, personal jurisdiction, and subject matter jurisdiction), by considerations of judicial discretion, and by 28 U.S.C. § 1404(a) (permitting transfer of venue in the interest of justice).

(c) The enforceability of provisions in the Loan Documents providing for the waiver by any party of its right to a trial by jury (the "Jury Waiver Provisions") may not be enforceable under applicable law in certain jurisdictions. We note that the enforceability of jury trial waiver provisions is unsettled in certain courts and that some courts have held that such waivers are unenforceable as a matter of public policy or that the circumstances of the waiver did not satisfy the requirements for a knowing and voluntary waiver of a constitutional right.

5.6 Security Interest and Priority Qualification

(a) Our opinions as to the priority of the security interests created under the Security Agreement and the Pledge Agreement are subject to (i) liens and encumbrances having priority by operation of applicable law, including, without limitation, federal, state, and local tax liens (including liens arising under Section 6323 of the Internal Revenue Code of 1986, as amended), statutory liens, mechanics' and materialmen's liens, landlord's liens, warehousemen's liens, carriers' liens, and other liens arising by operation of law, and (ii) Permitted Liens and other liens and encumbrances expressly permitted under the Credit Agreement.

(b) We express no opinion as to the creation, validity, perfection, or priority of any security interest in:

(i) any property to the extent the Uniform Commercial Code is not applicable thereto;

(ii) real property or any interest therein (other than fixtures to the extent covered by Article 9 of the Uniform Commercial Code);

(iii) motor vehicles or other goods subject to a certificate of title statute of any jurisdiction;

(iv) intellectual property registered with the United States Patent and Trademark Office or the United States Copyright Office (which is subject to a negative pledge covenant under the Credit Agreement, but as to which perfection of a security interest may require federal filings with the United States Patent and Trademark Office or the United States Copyright Office, which filings are not covered by this opinion);

(v) letter-of-credit rights to the extent that perfection of a security interest therein requires "control" within the meaning of Section 9-107 of the Uniform Commercial Code, unless such control has been established;

(vi) commercial tort claims that have not been specifically identified in the Security Agreement or any supplement thereto delivered on or prior to the date hereof;

(vii) any "proceeds" (as defined in the applicable Uniform Commercial Code) to the extent consisting of types of property as to which this opinion does not address the creation or perfection of a security interest; and

(viii) any assets or property located outside the United States, to the extent that the laws of a foreign jurisdiction govern the creation, perfection, or priority of a security interest therein.

(c) We note that continuation statements must be timely filed with the applicable filing office in order to maintain the effectiveness and perfection of the UCC-1 financing statements referenced in Section 2(17) above. Under Section 9-515 of the applicable Uniform Commercial Code, the initial effectiveness of each such UCC-1 financing statement is five (5) years from the date of filing, and a continuation statement must be filed within the six-month period preceding the expiration of such five-year period in order to continue the effectiveness of the initial financing statement for an additional five-year period. Failure to timely file a continuation statement will result in the lapse of the financing statement and the loss of perfection of the security interest evidenced thereby.

5.7 Scope of Laws Covered

This opinion is limited to the laws of the State of New York (excluding the real property laws thereof), the General Corporation Law of the State of Delaware (Title 8 of the Delaware Code), the Delaware Limited Liability Company Act (Title 6, Chapter 18 of the Delaware Code), and the federal laws of the United States of America, in each case as currently in effect on the date hereof. We express no opinion as to the laws of any other jurisdiction, including, without limitation:

(a) the laws of the State of Washington, except that we have relied upon a certificate of good standing issued by the Secretary of State of the State of Washington with respect to COS, and upon UCC filing records maintained by the Secretary of State of the State of Washington with respect to the filing of the UCC-1 financing statement naming COS as debtor;

(b) the laws of the Province of British Columbia or the federal or provincial laws of Canada (including, without limitation, the British Columbia Personal Property Security Act and the Business Corporations Act (British Columbia)), with respect to Cascade Retail Canada ULC or the pledge of equity interests therein; and

(c) any laws, statutes, rules, regulations, orders, or decrees relating to or governing environmental matters, tax matters, labor and employment matters, employee benefit plans or arrangements subject to the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), antitrust or competition matters, health care regulatory matters, land use and zoning matters, insurance regulatory matters, or any other specialized regulatory or administrative matters.

6. Reliance and Other Matters

This opinion letter is furnished solely for the benefit of the addressees hereof—namely, Crescent Harbor Bank, N.A., in its capacities as Administrative Agent and Collateral Agent, and each Lender party to the Credit Agreement as of the date hereof (Crescent Harbor Bank, N.A., Northgate Capital Bank, and Bridgevale Financial Corporation)—and their respective permitted successors and assigns under the Credit Agreement, and may not be relied upon, quoted, circulated, published, or otherwise referred to by any other person or entity, or for any other purpose, without our prior written consent in each instance.

This opinion letter is rendered solely as of the date hereof, and we assume no obligation to update or supplement this opinion letter to reflect any facts or circumstances that may hereafter come to our attention or any changes in applicable law (whether by legislative action, judicial decision, or otherwise) that may hereafter occur, even if such facts, circumstances, or changes in law would affect the opinions expressed herein. The opinions expressed herein are based on facts existing and laws in effect on the date hereof, and we disclaim any obligation to advise any person of any change in any matter set forth herein.

The opinions expressed herein are limited to the specific matters set forth above, and no opinion is implied or may be inferred beyond the matters expressly stated herein. Without limiting the generality of the foregoing, we express no opinion with respect to the business judgment of the Loan Parties or any of their directors, officers, members, or managers in entering into the transactions contemplated by the Loan Documents, or as to the fairness, commercial reasonableness, or adequacy of the consideration provided for in any of the Loan Documents.

This opinion letter has been prepared in connection with our representation of the Loan Parties referenced above and relates to Calderwood & Harkness LLP Matter No. 1038-00002.

Very truly yours,

CALDERWOOD & HARKNESS LLP

By: ________

Claudia Merritt, Partner

cc: Derek Tanaka, Esq. General Counsel & Corporate Secretary Cascade Retail Holdings Inc. 2200 Elliott Avenue, Suite 1400 Seattle, Washington 98121

cc: Elena Kowalski Chief Financial Officer Cascade Retail Holdings Inc. 2200 Elliott Avenue, Suite 1400 Seattle, Washington 98121

cc: Bernard Ashford, Esq. Whitfield, Greer & Holloway LLP 51 West 52nd Street, 35th Floor New York, New York 10019 (Administrative Agent's / Lenders' counsel — WGH Matter No. 1038-00002)

CALDERWOOD & HARKNESS LLP Attorneys at Law
599 Lexington Avenue, 42nd Floor New York, New York 10022 Telephone: (212) 506-7000 Facsimile: (212) 506-7070 www.calderwoodharkness.com
May 19, 2023
Crescent Harbor Bank, National Association, as Administrative Agent and Collateral Agent 780 Park Avenue, 30th Floor New York, New York 10021
and
Each of the Lenders party to the Credit Agreement referenced below:
Crescent Harbor Bank, N.A. Northgate Capital Bank Bridgevale Financial Corporation
Ladies and Gentlemen:
We have acted as counsel to Cascade Retail Holdings Inc., a corporation duly incorporated under the laws of the State of Delaware ("CRH" or the "Borrower"), and Cascade Retail Operating Company LLC, a limited liability company duly formed under the laws of the State of Delaware ("CROC" or the "Co-Borrower," and together with CRH, the "Borrowers"), in connection with that certain Credit Agreement dated as of May 4, 2023 (effective May 19, 2023) (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement") among the Borrowers, Cascade Digital Commerce Inc., a corporation incorporated under the laws of the State of Delaware ("CDC"), Cascade Outlet Stores LLC, a limited liability company formed under the laws of the State of Washington ("COS"), and Cascade Fulfillment Services Inc., a corporation incorporated under the laws of the State of Delaware ("CFS," and together with CDC and COS, collectively the "Guarantors"), the Lenders party thereto from time to time (the "Lenders"), and Crescent Harbor Bank, N.A., in its capacity as Administrative Agent and Collateral Agent (in such capacities, the "Agent"). CRH, CROC, CDC, COS, and CFS are referred to herein collectively as the "Loan Parties" and each individually as a "Loan Party."
The Credit Agreement provides for a $300,000,000 Senior Secured Asset-Based Revolving Credit Facility (the "ABL Facility") in favor of the Borrowers, secured by the assets of the Loan Parties as more particularly described in the Loan Documents (as defined below).
This opinion letter is delivered to you pursuant to Section 4.01(h) of the Credit Agreement as a condition precedent to the initial extensions of credit thereunder on the date hereof.
1. Documents Examined; Loan Documents Defined
In connection with the opinions expressed herein, we have examined executed originals, or copies certified or otherwise identified to our satisfaction, of the following documents (collectively, the "Loan Documents"):
1.  The Credit Agreement dated as of May 4, 2023 (effective May 19, 2023), among the Borrowers, the Guarantors, the Lenders, and the Agent.
2.  The Guaranty Agreement dated as of May 4, 2023 (the "Guaranty Agreement"), executed by CDC, COS, and CFS (each as a "Guarantor" and collectively as the "Guarantors") in favor of the Agent for the benefit of the Secured Parties (as defined in the Credit Agreement).
3.  The Security Agreement dated as of May 4, 2023 (the "Security Agreement"), among the Loan Parties, as Grantors, and the Agent, as Collateral Agent for the benefit of the Secured Parties.
4.  The Pledge Agreement dated as of May 4, 2023 (the "Pledge Agreement"), by CRH (pledging 100% of the issued and outstanding equity interests in CROC) and by CROC (pledging 100% of the issued and outstanding equity interests in each of CDC, COS, and CFS, and 65% of the voting equity interests in Cascade Retail Canada ULC, a British Columbia unlimited liability company), in each case in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties.
5.  Revolving Loan Promissory Note dated May 4, 2023, executed by the Borrowers in the stated principal amount of $135,000,000, payable to the order of Crescent Harbor Bank, N.A.
6.  Revolving Loan Promissory Note dated May 4, 2023, executed by the Borrowers in the stated principal amount of $90,000,000, payable to the order of Northgate Capital Bank.
7.  Revolving Loan Promissory Note dated May 4, 2023, executed by the Borrowers in the stated principal amount of $75,000,000, payable to the order of Bridgevale Financial Corporation.
8.  Swingline Promissory Note dated May 4, 2023, executed by the Borrowers in the stated principal amount of up to $25,000,000, payable to the order of Crescent Harbor Bank, N.A., in its capacity as Swingline Lender.
9.  The Perfection Certificate dated May 4, 2023 (the "Perfection Certificate"), executed by each of the Loan Parties and delivered to the Agent.
10.  Each Deposit Account Control Agreement dated May 19, 2023 (collectively, the "DACAs"), including the following:
(a) Deposit Account Control Agreement among CRH, as account holder, Meridian Trust Company, N.A. (1001 Fourth Avenue, Suite 500, Seattle, Washington 98154), as depository bank, and the Agent, as Collateral Agent;
(b) Deposit Account Control Agreement among CROC, as account holder, and Crescent Harbor Bank, N.A. (acting in its dual capacity as depository bank and as Collateral Agent);
(c) Deposit Account Control Agreement among CRH, as account holder, and Crescent Harbor Bank, N.A. (acting in its dual capacity as depository bank and as Collateral Agent), with respect to the concentration account designated for the receipt of collections on accounts receivable;
(d) Deposit Account Control Agreement among CDC, as account holder, Northgate Capital Bank, as depository bank, and the Agent, as Collateral Agent.
The Loan Documents described above, together with all schedules, exhibits, annexes, and ancillary documents delivered in connection therewith and such other documents as we have reviewed in connection with the preparation of this opinion, are referred to herein collectively as the "Transaction Documents."
2. Other Documents and Items Examined
In addition to the Loan Documents, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following documents and other items:
1.  The Certificate of Incorporation of CRH (including all certificates of amendment and certificates of designations thereto), as certified by the Secretary of State of the State of Delaware as of a recent date.
2.  The Bylaws of CRH, as currently in effect, as certified by the Secretary of CRH.
3.  The Certificate of Formation of CROC, as certified by the Secretary of State of the State of Delaware as of a recent date.
4.  The Limited Liability Company Agreement of CROC, as currently in effect, as certified by an authorized representative of CROC.
5.  The Certificate of Incorporation of CDC (including all certificates of amendment thereto), as certified by the Secretary of State of the State of Delaware as of a recent date.
6.  The Bylaws of CDC, as currently in effect, as certified by the Secretary of CDC.
7.  The Certificate of Formation of COS, as certified by the Secretary of State of the State of Washington as of a recent date.
8.  The Operating Agreement of COS, as currently in effect, as certified by an authorized representative of COS.
9.  The Certificate of Incorporation of CFS (including all certificates of amendment thereto), as certified by the Secretary of State of the State of Delaware as of a recent date.
10.  The Bylaws of CFS, as currently in effect, as certified by the Secretary of CFS.
11.  Resolutions of the Board of Directors of CRH, duly adopted at a meeting held on February 27, 2023, authorizing the execution and delivery of the Loan Documents and the consummation of the transactions contemplated thereby, including the borrowing under the ABL Facility in an aggregate principal amount of up to $300,000,000, and designating Nathaniel Voss (Chief Executive Officer) and Elena Kowalski (Chief Financial Officer) as authorized signatories with respect to the Loan Documents, as certified by the Secretary's Certificate of CRH dated May 19, 2023.
12.  Member resolutions of CROC, duly adopted by written consent of its sole member, authorizing the execution, delivery, and performance by CROC of the Loan Documents to which CROC is a party and the transactions contemplated thereby, as certified by an authorized representative of CROC.
13.  Resolutions of the Board of Directors of CDC and CFS, and member resolutions of COS, in each case duly adopted and authorizing the execution, delivery, and performance by each such Guarantor of the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which such Guarantor is a party, as certified by the respective Secretary's Certificates or authorized representative certificates of each such Guarantor.
14.  Secretary's Certificates (including incumbency certificates) of CRH, CROC, CDC, COS, and CFS, each dated May 19, 2023, certifying as to the incumbency and specimen signatures of the officers or authorized representatives of each Loan Party who executed the Loan Documents on behalf of such Loan Party.
15.  Officer's Certificate of the Borrower dated May 19, 2023, executed by Elena Kowalski, Chief Financial Officer of CRH, certifying as to, among other things, the accuracy and completeness of the representations and warranties set forth in the Credit Agreement, the absence of any default or event of default thereunder, and compliance with the conditions precedent to the initial extensions of credit under the Credit Agreement.
16.  Good standing certificates for each Loan Party from the relevant Secretary of State, as follows: (a) certificates of good standing for CRH, CROC, CDC, and CFS, each issued by the Secretary of State of the State of Delaware; and (b) a certificate of good standing for COS issued by the Secretary of State of the State of Washington, each dated within five (5) business days of the date hereof.
17.  UCC-1 financing statements filed with the applicable filing offices, as follows:
(a) UCC-1 financing statement filed with the Secretary of State of the State of Delaware naming CRH as debtor and Crescent Harbor Bank, N.A., as Collateral Agent, as secured party (filing no. 2023-1947291);
(b) UCC-1 financing statement filed with the Secretary of State of the State of Delaware naming CROC as debtor and Crescent Harbor Bank, N.A., as Collateral Agent, as secured party (filing no. 2023-1947283); and
(c) UCC-1 financing statement filed with the Secretary of State of the State of Washington naming COS as debtor and Crescent Harbor Bank, N.A., as Collateral Agent, as secured party (filing no. 2023-204-8176).
18.  UCC, tax lien, and judgment search results for each Loan Party in their respective jurisdictions of organization, as conducted by Capitol Lien Records & Research, Inc. and delivered to us on or about May 15, 2023 (collectively, the "Lien Search Results").
19.  UCC-3 termination statements terminating all existing UCC-1 financing statements of record filed by or on behalf of Harborview Lending Group, LLC, as secured party, against each of the Loan Parties, as applicable, reflecting the termination of all security interests of Harborview Lending Group, LLC in the assets of the Loan Parties.
20.  Such other certificates, documents, agreements, corporate and company records, and instruments as we have deemed necessary or appropriate for purposes of rendering the opinions expressed herein.
3. Assumptions
In rendering the opinions expressed herein, we have, with your consent, assumed the following, without independent investigation or verification:
1.  The genuineness of all signatures on all documents examined by us (other than the signatures of the officers and authorized representatives of the Loan Parties, as to which we have relied on the Secretary's Certificates and incumbency certificates described in Section 2 above).
2.  The authenticity of all documents submitted to us as originals, the conformity to authentic originals of all documents submitted to us as copies (whether certified, photostatic, facsimile, electronic, or otherwise), and the authenticity of the originals of such copies.
3.  Each natural person who executed any of the Loan Documents on behalf of any party thereto (other than the Loan Parties) had the legal capacity to do so at the time of execution.
4.  Each party to the Loan Documents (other than the Loan Parties) is duly organized or formed, validly existing, and in good standing under the laws of its jurisdiction of organization or formation, and is duly qualified to do business in each jurisdiction where the conduct of its business or the ownership or leasing of its properties requires such qualification.
5.  Each party to the Loan Documents (other than the Loan Parties) has full power, authority, and legal right to execute, deliver, and perform its respective obligations under each of the Loan Documents to which it is a party, and such execution, delivery, and performance have been duly authorized by all requisite action on the part of such party.
6.  Each of the Loan Documents has been duly authorized, executed, and delivered by each party thereto (other than the Loan Parties) and constitutes the legal, valid, and binding obligation of each such party.
7.  Each of the Loan Documents constitutes the legally valid and binding obligation of each party thereto (other than the Loan Parties), enforceable against each such party in accordance with its terms, subject to applicable bankruptcy, insolvency, and similar laws affecting creditors' rights generally and to general principles of equity.
8.  The Credit Agreement and the related Loan Documents accurately describe the understanding and agreement of the parties thereto with respect to the transactions contemplated thereby, and no terms or conditions exist with respect to such transactions that are not reflected in the Loan Documents.
9.  There has been no mutual mistake of fact or misunderstanding, fraud, duress, or undue influence with respect to any of the Loan Documents or the transactions contemplated thereby.
10.  The proceeds of the loans made under the Credit Agreement will be used for lawful and proper corporate purposes of the Borrowers, including working capital and general corporate purposes, and not in violation of Regulations T, U, or X of the Board of Governors of the Federal Reserve System (12 C.F.R. Parts 220, 221, and 224, respectively), and no portion of such proceeds will be used, directly or indirectly, to purchase or carry any "margin stock" (as defined in Regulation U) or to extend credit for the purpose of purchasing or carrying any margin stock.
11.  Each Loan Party has filed all required federal, state, and local tax returns and has paid all taxes, assessments, and governmental charges due and payable by it, except as disclosed in the Officer's Certificate or the Credit Agreement.
12.  All factual matters stated in the Officer's Certificate dated May 19, 2023, the Secretary's Certificates dated May 19, 2023, the Perfection Certificate dated May 4, 2023, and all other certificates and documents delivered by the Loan Parties to us or to the Agent in connection with the transactions contemplated by the Credit Agreement are true, correct, and complete as of the date hereof, and no facts or circumstances exist that would render any such factual statements inaccurate or misleading.
13.  The description of the collateral contained in the Security Agreement and in each UCC-1 financing statement referenced in Section 2(17) above is sufficient under Article 9 of the Uniform Commercial Code, as in effect in the applicable jurisdiction, to create and perfect a security interest in the personal property described therein, and such descriptions reasonably identify the collateral within the meaning of Section 9-108 of the Uniform Commercial Code.
14.  Value has been given by the Lenders for the security interests granted under the Security Agreement and the Pledge Agreement, and each Loan Party has rights in the collateral described therein or the power to transfer rights therein to the Agent, as Collateral Agent, within the meaning of Section 9-203 of the Uniform Commercial Code.
4. Opinions
Based upon and subject to the foregoing, and subject further to the qualifications and exceptions set forth in Section 5 below, we are of the opinion that:
4.1 Due Organization and Good Standing
(a) CRH is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware.
(b) CROC is a limited liability company duly formed, validly existing, and in good standing under the laws of the State of Delaware.
(c) CDC is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware.
(d) COS is a limited liability company duly formed, validly existing, and in good standing under the laws of the State of Washington.
(e) CFS is a corporation duly incorporated, validly existing, and in good standing under the laws of the State of Delaware.
With respect to the opinions expressed in this Section 4.1, we have relied solely upon the good standing certificates issued by the Secretary of State of the State of Delaware (with respect to CRH, CROC, CDC, and CFS) and the Secretary of State of the State of Washington (with respect to COS), each dated within five (5) business days of the date hereof, and upon our review of the organizational documents described in Section 2 above. We express no opinion as to the qualification of any Loan Party to do business in any jurisdiction other than its jurisdiction of organization.
4.2 Power and Authority
(a) Each of CRH and CROC, in its capacity as a Borrower, has all requisite corporate or limited liability company power and authority to (i) execute and deliver the Loan Documents to which it is a party, (ii) borrow under the Credit Agreement and incur the obligations evidenced by the Revolving Loan Notes and the Swingline Note, (iii) grant the security interests and pledges contemplated by the Security Agreement and the Pledge Agreement, and (iv) perform its obligations under the Loan Documents to which it is a party.
(b) Each of CDC, COS, and CFS, in its capacity as a Guarantor, has all requisite corporate or limited liability company power and authority to (i) execute and deliver the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which it is a party, (ii) guarantee the payment and performance of all Obligations (as defined in the Credit Agreement) pursuant to the Guaranty Agreement, (iii) grant the security interests contemplated by the Security Agreement and the Pledge Agreement (to the extent applicable), and (iv) perform its obligations under the Loan Documents to which it is a party.
4.3 Due Authorization
The execution, delivery, and performance by each Loan Party of each of the Loan Documents to which such Loan Party is a party, and the consummation of the transactions contemplated thereby, have been duly authorized by all requisite corporate or limited liability company action on the part of such Loan Party. Without limiting the generality of the foregoing:
(a) The Board of Directors of CRH, by resolutions duly adopted at a meeting held on February 27, 2023, authorized the entry into the $300,000,000 ABL Facility and the execution, delivery, and performance of the Loan Documents by CRH, and designated Nathaniel Voss, Chief Executive Officer, and Elena Kowalski, Chief Financial Officer, as authorized signatories with respect to the Loan Documents and any certificates, instruments, or other documents to be delivered in connection therewith.
(b) The sole member of CROC, by written consent effective as of February 27, 2023, authorized the execution, delivery, and performance by CROC of the Loan Documents to which CROC is a party and the consummation of the transactions contemplated thereby.
(c) The Board of Directors of CDC, by resolutions duly adopted by written consent effective as of February 27, 2023, authorized the execution, delivery, and performance by CDC of the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which CDC is a party. The Board of Directors of CFS, by resolutions duly adopted by written consent effective as of February 27, 2023, authorized the execution, delivery, and performance by CFS of the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which CFS is a party. The sole member of COS, by written consent effective as of February 27, 2023, authorized the execution, delivery, and performance by COS of the Guaranty Agreement, the Security Agreement, and the other Loan Documents to which COS is a party.
No stockholder or member vote or consent is required under applicable law, the certificate of incorporation, bylaws, certificate of formation, limited liability company agreement, operating agreement, or other organizational documents of any Loan Party, or under any agreement or instrument to which any Loan Party is a party or by which any Loan Party or its properties is bound, for the execution, delivery, and performance by such Loan Party of the Loan Documents to which it is a party or the consummation of the transactions contemplated thereby.
4.4 Execution and Delivery
Each Loan Document has been duly executed and delivered by each Loan Party that is a party thereto. In rendering this opinion, we have relied upon the Secretary's Certificates and incumbency certificates described in Section 2(14) above with respect to the identity and authority of the officers and authorized representatives who executed the Loan Documents on behalf of each Loan Party.
4.5 Enforceability.  Each Loan Document to which a Loan Party is a party constitutes the legal, valid, and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its terms. Without limiting the generality of the foregoing, and subject to the qualifications set forth in Section 5 below:
(a) The Credit Agreement constitutes the legal, valid, and binding obligation of each Borrower and each Guarantor party thereto, enforceable in accordance with its terms, including, without limitation, (i) the obligation of the Borrowers to repay all Revolving Loans at the applicable interest rate of Adjusted Term SOFR plus 300 basis points per annum (subject to the applicable margin pricing grid), (ii) the obligation of the Borrowers to repay all Revolving Loans and other Obligations in full on the Maturity Date of May 19, 2028, (iii) the springing Financial Covenant requiring maintenance of a minimum Fixed Charge Coverage Ratio of not less than 1.10 to 1.00 for each Testing Period during a Trigger Period (as each such term is defined in the Credit Agreement), and (iv) all other obligations, covenants, representations, warranties, and agreements of the Borrowers and the Guarantors contained therein.
(b) The Guaranty Agreement constitutes the legal, valid, and binding obligation of each Guarantor (CDC, COS, and CFS), enforceable in accordance with its terms, including the unconditional and irrevocable guaranty by each Guarantor of the prompt and complete payment and performance when due of all Obligations of the Borrowers under the Credit Agreement and the other Loan Documents.
(c) The Security Agreement constitutes the legal, valid, and binding obligation of each Loan Party that is a Grantor thereunder, enforceable in accordance with its terms, including the grant by each Grantor of a first-priority security interest in all of such Grantor's right, title, and interest in and to the ABL Collateral (as defined therein) in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties, subject to Permitted Liens (as defined in the Credit Agreement).
(d) The Pledge Agreement constitutes the legal, valid, and binding obligation of CRH and CROC, enforceable in accordance with its terms, including the pledge by CRH of 100% of the issued and outstanding equity interests in CROC, and the pledge by CROC of 100% of the issued and outstanding equity interests in each of CDC, COS, and CFS, and 65% of the voting equity interests in Cascade Retail Canada ULC.
(e) Each Revolving Loan Promissory Note constitutes the legal, valid, and binding obligation of the Borrowers, enforceable in accordance with its terms, including the Revolving Loan Promissory Note in the stated principal amount of $135,000,000 payable to the order of Crescent Harbor Bank, N.A., the Revolving Loan Promissory Note in the stated principal amount of $90,000,000 payable to the order of Northgate Capital Bank, and the Revolving Loan Promissory Note in the stated principal amount of $75,000,000 payable to the order of Bridgevale Financial Corporation.
(f) The Swingline Promissory Note in the stated principal amount of up to $25,000,000, payable to the order of Crescent Harbor Bank, N.A. in its capacity as Swingline Lender, constitutes the legal, valid, and binding obligation of the Borrowers, enforceable in accordance with its terms.
The enforceability opinions set forth in this Section 4.5 are subject to the qualifications and exceptions set forth in Section 5 below.
4.6 No Conflicts
The execution, delivery, and performance by each Loan Party of the Loan Documents to which such Loan Party is a party, and the consummation of the transactions contemplated thereby (including the borrowings under the Credit Agreement, the granting of the security interests and pledges under the Security Agreement and the Pledge Agreement, and the guarantees under the Guaranty Agreement), do not and will not:
(a) Violate or conflict with the certificate of incorporation, bylaws, certificate of formation, limited liability company agreement, operating agreement, or other organizational documents of such Loan Party;
(b) Violate or conflict with any law, statute, rule, or regulation of the State of New York, the State of Delaware, or the federal laws of the United States applicable to such Loan Party (to the extent addressed in this opinion and subject to the limitations set forth in Section 5.7 below);
(c) Result in a breach of, or constitute a default (or an event that, with the giving of notice or lapse of time or both, would constitute a default) under, any material agreement or instrument listed on Schedule 5.04 to the Credit Agreement to which such Loan Party is a party or by which such Loan Party or any of its properties is bound (it being understood that our opinion in this clause (c) is rendered without independent investigation, based solely on our review of the agreements identified to us by the Loan Parties and listed on Schedule 5.04 to the Credit Agreement, and upon the representations and warranties of the Loan Parties in the Officer's Certificate and the Credit Agreement); or
(d) Result in or require the creation or imposition of any lien, charge, pledge, security interest, or other encumbrance upon any property or assets of any Loan Party, other than the liens and security interests created under the Security Agreement and the Pledge Agreement in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties, and the Permitted Liens (as defined in the Credit Agreement).
4.7 No Governmental Approvals Required
No consent, approval, authorization, order, registration, qualification, license, or filing with, or other action by, any governmental authority or regulatory body of the United States, the State of New York, the State of Delaware, or the State of Washington is required for the execution, delivery, or performance by any Loan Party of any Loan Document to which such Loan Party is a party, or for the validity or enforceability thereof, or for the creation or perfection of the security interests and pledges contemplated by the Security Agreement and the Pledge Agreement, except:
(a) The filing of UCC-1 financing statements with the Secretary of State of the State of Delaware (with respect to CRH and CROC as debtors) and the Secretary of State of the State of Washington (with respect to COS as debtor), which filings have been duly made as described in Section 2(17) above;
(b) Such filings and registrations as may be required under federal or state securities laws in connection with the issuance of the Revolving Loan Notes and the Swingline Note, which Notes are exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof and are exempt from the registration or qualification requirements of applicable state securities laws; and
(c) Such other filings, consents, approvals, and authorizations as have already been obtained or made and are in full force and effect as of the date hereof.
4.8 Creation of Security Interests
(a) The Security Agreement creates in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties, a valid security interest in all right, title, and interest of each Grantor (as defined in the Security Agreement) in and to the collateral described therein (the "ABL Collateral"), to the extent that a security interest therein can be created under Article 9 of the Uniform Commercial Code as in effect in the State of New York (the "NY UCC") and the Uniform Commercial Code as in effect in the State of Delaware (the "DE UCC"). The ABL Collateral includes, without limitation, all of each Grantor's right, title, and interest in and to:
(i) all accounts receivable (whether now existing or hereafter arising);
(ii) all inventory (including, without limitation, all raw materials, work-in-process, finished goods, goods in transit, and distribution center inventory);
(iii) all deposit accounts (subject to perfection by "control" as described in Section 4.9 below);
(iv) all supporting obligations;
(v) all chattel paper (whether tangible or electronic);
(vi) all instruments;
(vii) all letter-of-credit rights;
(viii) all commercial tort claims (to the extent specifically identified in the Security Agreement or any supplement thereto);
(ix) all general intangibles (including, without limitation, payment intangibles and software); and
(x) all proceeds (as defined in Section 9-102(a)(64) of the NY UCC) of any and all of the foregoing, including, without limitation, cash proceeds, insurance proceeds, and all products thereof.
(b) The Pledge Agreement creates in favor of the Agent, as Collateral Agent for the benefit of the Secured Parties, a valid security interest in all right, title, and interest of CRH and CROC (each as a "Pledgor") in and to the pledged equity interests described therein, including (i) 100% of the issued and outstanding equity interests of CROC held by CRH, (ii) 100% of the issued and outstanding equity interests of each of CDC, COS, and CFS held by CROC, and (iii) 65% of the voting equity interests in Cascade Retail Canada ULC held by CROC, together with all distributions, dividends, cash, instruments, and other property from time to time received, receivable, or otherwise distributed in respect of or in exchange for any or all of such pledged equity interests, and all proceeds thereof.
4.9 Perfection of Security Interests
(a) Upon the filing of the UCC-1 financing statements with (i) the Secretary of State of the State of Delaware naming CRH as debtor (filing no. 2023-1947291), (ii) the Secretary of State of the State of Delaware naming CROC as debtor (filing no. 2023-1947283), and (iii) the Secretary of State of the State of Washington naming COS as debtor (filing no. 2023-204-8176), in each case naming Crescent Harbor Bank, N.A., as Collateral Agent, as the secured party, the security interests created under the Security Agreement in personal property collateral in which a security interest may be perfected by filing a UCC-1 financing statement under Article 9 of the applicable Uniform Commercial Code have been perfected. Such perfected security interests constitute first-priority security interests in such collateral, subject only to (i) Permitted Liens (as defined in the Credit Agreement), and (ii) liens and encumbrances that have priority by operation of applicable law (including, without limitation, purchase-money security interests that comply with the requirements of UCC Section 9-324, tax liens, statutory liens, and mechanics' and materialmen's liens).
(b) Perfection of a security interest in deposit accounts as "original collateral" (as distinguished from deposit accounts as proceeds of other collateral) requires "control" by the secured party within the meaning of Section 9-104 of the Uniform Commercial Code. The DACAs executed on May 19, 2023, with respect to four deposit accounts—two maintained at Crescent Harbor Bank, N.A., one maintained at Northgate Capital Bank, and one maintained at Meridian Trust Company, N.A. (1001 Fourth Avenue, Suite 500, Seattle, Washington 98154)—are intended to establish such "control" within the meaning of Section 9-104 of the applicable Uniform Commercial Code. Assuming that each depository bank named in the DACAs has agreed to comply with the instructions originated by the Agent directing disposition of the funds in such deposit accounts without further consent of the applicable Loan Party (or, in the case of Crescent Harbor Bank, N.A. acting in its dual capacity as depository bank and Collateral Agent, that such control is established by virtue of the Agent's status as the customer's bank within the meaning of Section 9-104(a)(1) of the UCC), the security interest of the Agent in such deposit accounts has been perfected by "control."
(c) Perfection of the security interest in the pledged equity interests in CROC (a Delaware limited liability company, the equity interests of which are not represented by certificates) is achieved by filing a UCC-1 financing statement in the State of Delaware. To the extent that any equity interests pledged under the Pledge Agreement are represented by certificates (including, without limitation, equity interests in CDC and CFS to the extent represented by stock certificates), perfection of the security interest therein requires delivery of such certificates to the Agent, as Collateral Agent, together with duly executed stock powers or transfer powers endorsed in blank. We have been informed by officers of the Loan Parties, and we assume for purposes of this opinion, that such delivery has been accomplished as of the date hereof with respect to all certificated equity interests subject to the Pledge Agreement.
(d) With respect to the pledge by CROC of 65% of the voting equity interests in Cascade Retail Canada ULC, a British Columbia unlimited liability company, we express no opinion regarding the creation, validity, perfection, or priority of any security interest in equity interests of a foreign entity except to the extent that such security interest may be perfected by the filing of a UCC-1 financing statement in the State of Delaware (the jurisdiction of CROC's location for purposes of Article 9 of the DE UCC). We note that applicable Canadian or British Columbia law may impose additional requirements for the creation, perfection, or enforcement of a security interest in equity interests of a British Columbia unlimited liability company, and we express no opinion with respect thereto.
5. Qualifications and Exceptions
The opinions expressed herein are subject to the following qualifications and exceptions:
5.1 Bankruptcy and Insolvency Qualification
The enforceability opinions expressed in Section 4.5 above and elsewhere in this opinion letter are subject to and limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium, receivership, conservatorship, fraudulent conveyance, fraudulent transfer, and similar laws affecting creditors' rights and remedies generally (including, without limitation, Title 11 of the United States Code (the "Bankruptcy Code"), the effect of statutory and other laws regarding fraudulent conveyances and preferential transfers, including Sections 544, 547, 548, and 550 of the Bankruptcy Code and Article 10 of the New York Debtor and Creditor Law), and (b) general principles of equity (including, without limitation, concepts of materiality, reasonableness, good faith, and fair dealing), regardless of whether considered in a proceeding in equity or at law (the limitations described in clauses (a) and (b) are collectively referred to herein as the "Enforceability Exceptions"). We express no opinion as to (i) the effect of any bankruptcy, insolvency, reorganization, moratorium, or similar proceeding on the enforceability of any provision of any Loan Document, (ii) the ability of any Loan Party or any trustee or receiver to assume, reject, or assign any Loan Document in any such proceeding, or (iii) whether any transfer or obligation incurred in connection with the transactions contemplated by the Loan Documents could be avoided or recovered under the Bankruptcy Code or any applicable state law.
5.2 Equitable Principles Qualification
The remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses (including, without limitation, the defenses of laches, estoppel, waiver, and unclean hands) and to the discretion of the court before which any proceeding therefor may be brought. We express no opinion as to whether or to what extent a court of competent jurisdiction would grant specific performance or other equitable relief with respect to any provision of any Loan Document.
5.3 Usury Qualification
We express no opinion as to the enforceability of any provision of any Loan Document to the extent that such provision constitutes or may constitute a penalty or forfeiture, or to the extent that the enforcement thereof may be limited or affected by federal or state usury laws. Notwithstanding the foregoing, based on the terms of the Credit Agreement and applicable New York law (including Section 5-501 of the New York General Obligations Law and Sections 190.40 and 190.42 of the New York Penal Law) and applicable federal law (including the exemption available to national banking associations under 12 U.S.C. § 85 and the regulations promulgated thereunder by the Office of the Comptroller of the Currency), the stated interest rate applicable to the Revolving Loans under the Credit Agreement—being Adjusted Term SOFR plus a spread of 300 basis points per annum—and the default rate of an additional 200 basis points per annum above such rate, do not, on their face, violate any applicable usury statute or regulation. This conclusion assumes that the calculations of interest under the Credit Agreement are performed in accordance with the provisions thereof and that no fees, charges, or other amounts that could be characterized as "interest" under applicable law cause the effective rate of interest to exceed the maximum rate permitted by applicable law.
5.4 Indemnification Qualification
The enforceability of provisions in the Loan Documents relating to indemnification, contribution, or exculpation may be limited by applicable law and public policy considerations, including, without limitation, (a) applicable federal and state securities laws (to the extent that any such indemnification provision purports to indemnify a party against liability arising under the Securities Act of 1933, as amended, or any state securities law), and (b) general principles of equity, including the principle that a party may not be indemnified against its own willful misconduct, gross negligence, fraud, or bad faith, or against liabilities arising from violations of public policy.
5.5 Choice of Law and Forum Selection Qualification
(a) The enforceability of provisions in the Loan Documents designating the laws of the State of New York as the governing law thereof may be subject to (i) the constitutional and statutory limitations of the jurisdiction whose law would be applicable in the absence of such choice of law provision, and (ii) Section 5-1401 of the New York General Obligations Law (which, by its terms, applies to agreements covering transactions involving aggregate consideration of not less than $250,000, and therefore applies to the Loan Documents). We note that a court in a jurisdiction other than New York may not give effect to such choice of law provisions if the application of New York law would be contrary to a fundamental public policy of such other jurisdiction.
(b) The enforceability of provisions in the Loan Documents selecting the United States District Court for the Southern District of New York or the Supreme Court of the State of New York, New York County, as the exclusive forum for the resolution of disputes arising under the Loan Documents may be limited by applicable procedural rules (including rules relating to venue, personal jurisdiction, and subject matter jurisdiction), by considerations of judicial discretion, and by 28 U.S.C. § 1404(a) (permitting transfer of venue in the interest of justice).
(c) The enforceability of provisions in the Loan Documents providing for the waiver by any party of its right to a trial by jury (the "Jury Waiver Provisions") may not be enforceable under applicable law in certain jurisdictions. We note that the enforceability of jury trial waiver provisions is unsettled in certain courts and that some courts have held that such waivers are unenforceable as a matter of public policy or that the circumstances of the waiver did not satisfy the requirements for a knowing and voluntary waiver of a constitutional right.
5.6 Security Interest and Priority Qualification
(a) Our opinions as to the priority of the security interests created under the Security Agreement and the Pledge Agreement are subject to (i) liens and encumbrances having priority by operation of applicable law, including, without limitation, federal, state, and local tax liens (including liens arising under Section 6323 of the Internal Revenue Code of 1986, as amended), statutory liens, mechanics' and materialmen's liens, landlord's liens, warehousemen's liens, carriers' liens, and other liens arising by operation of law, and (ii) Permitted Liens and other liens and encumbrances expressly permitted under the Credit Agreement.
(b) We express no opinion as to the creation, validity, perfection, or priority of any security interest in:
(i) any property to the extent the Uniform Commercial Code is not applicable thereto;
(ii) real property or any interest therein (other than fixtures to the extent covered by Article 9 of the Uniform Commercial Code);
(iii) motor vehicles or other goods subject to a certificate of title statute of any jurisdiction;
(iv) intellectual property registered with the United States Patent and Trademark Office or the United States Copyright Office (which is subject to a negative pledge covenant under the Credit Agreement, but as to which perfection of a security interest may require federal filings with the United States Patent and Trademark Office or the United States Copyright Office, which filings are not covered by this opinion);
(v) letter-of-credit rights to the extent that perfection of a security interest therein requires "control" within the meaning of Section 9-107 of the Uniform Commercial Code, unless such control has been established;
(vi) commercial tort claims that have not been specifically identified in the Security Agreement or any supplement thereto delivered on or prior to the date hereof;
(vii) any "proceeds" (as defined in the applicable Uniform Commercial Code) to the extent consisting of types of property as to which this opinion does not address the creation or perfection of a security interest; and
(viii) any assets or property located outside the United States, to the extent that the laws of a foreign jurisdiction govern the creation, perfection, or priority of a security interest therein.
(c) We note that continuation statements must be timely filed with the applicable filing office in order to maintain the effectiveness and perfection of the UCC-1 financing statements referenced in Section 2(17) above. Under Section 9-515 of the applicable Uniform Commercial Code, the initial effectiveness of each such UCC-1 financing statement is five (5) years from the date of filing, and a continuation statement must be filed within the six-month period preceding the expiration of such five-year period in order to continue the effectiveness of the initial financing statement for an additional five-year period. Failure to timely file a continuation statement will result in the lapse of the financing statement and the loss of perfection of the security interest evidenced thereby.
5.7 Scope of Laws Covered
This opinion is limited to the laws of the State of New York (excluding the real property laws thereof), the General Corporation Law of the State of Delaware (Title 8 of the Delaware Code), the Delaware Limited Liability Company Act (Title 6, Chapter 18 of the Delaware Code), and the federal laws of the United States of America, in each case as currently in effect on the date hereof. We express no opinion as to the laws of any other jurisdiction, including, without limitation:
(a) the laws of the State of Washington, except that we have relied upon a certificate of good standing issued by the Secretary of State of the State of Washington with respect to COS, and upon UCC filing records maintained by the Secretary of State of the State of Washington with respect to the filing of the UCC-1 financing statement naming COS as debtor;
(b) the laws of the Province of British Columbia or the federal or provincial laws of Canada (including, without limitation, the British Columbia Personal Property Security Act and the Business Corporations Act (British Columbia)), with respect to Cascade Retail Canada ULC or the pledge of equity interests therein; and
(c) any laws, statutes, rules, regulations, orders, or decrees relating to or governing environmental matters, tax matters, labor and employment matters, employee benefit plans or arrangements subject to the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), antitrust or competition matters, health care regulatory matters, land use and zoning matters, insurance regulatory matters, or any other specialized regulatory or administrative matters.
6. Reliance and Other Matters
This opinion letter is furnished solely for the benefit of the addressees hereof—namely, Crescent Harbor Bank, N.A., in its capacities as Administrative Agent and Collateral Agent, and each Lender party to the Credit Agreement as of the date hereof (Crescent Harbor Bank, N.A., Northgate Capital Bank, and Bridgevale Financial Corporation)—and their respective permitted successors and assigns under the Credit Agreement, and may not be relied upon, quoted, circulated, published, or otherwise referred to by any other person or entity, or for any other purpose, without our prior written consent in each instance.
This opinion letter is rendered solely as of the date hereof, and we assume no obligation to update or supplement this opinion letter to reflect any facts or circumstances that may hereafter come to our attention or any changes in applicable law (whether by legislative action, judicial decision, or otherwise) that may hereafter occur, even if such facts, circumstances, or changes in law would affect the opinions expressed herein. The opinions expressed herein are based on facts existing and laws in effect on the date hereof, and we disclaim any obligation to advise any person of any change in any matter set forth herein.
The opinions expressed herein are limited to the specific matters set forth above, and no opinion is implied or may be inferred beyond the matters expressly stated herein. Without limiting the generality of the foregoing, we express no opinion with respect to the business judgment of the Loan Parties or any of their directors, officers, members, or managers in entering into the transactions contemplated by the Loan Documents, or as to the fairness, commercial reasonableness, or adequacy of the consideration provided for in any of the Loan Documents.
This opinion letter has been prepared in connection with our representation of the Loan Parties referenced above and relates to Calderwood & Harkness LLP Matter No. 1038-00002.
Very truly yours,
CALDERWOOD & HARKNESS LLP
By: ________
Claudia Merritt, Partner
cc: Derek Tanaka, Esq. General Counsel & Corporate Secretary Cascade Retail Holdings Inc. 2200 Elliott Avenue, Suite 1400 Seattle, Washington 98121
cc: Elena Kowalski Chief Financial Officer Cascade Retail Holdings Inc. 2200 Elliott Avenue, Suite 1400 Seattle, Washington 98121
cc: Bernard Ashford, Esq. Whitfield, Greer & Holloway LLP 51 West 52nd Street, 35th Floor New York, New York 10019 (Administrative Agent's / Lenders' counsel — WGH Matter No. 1038-00002)

CALDERWOOD & HARKNESS LLP Attorneys at Law

CALDERWOOD & HARKNESS LLP

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