DEPOSIT ACCOUNT CONTROL AGREEMENT
dated as of
May 19, 2023
among
CASCADE RETAIL OPERATING COMPANY LLC, as Account Holder,
CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, as Depository Bank,
and
CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, as Collateral Agent for the Secured Parties
Relating to the $300,000,000 Senior Secured Asset-Based Revolving Credit Facility
DEPOSIT ACCOUNT CONTROL AGREEMENT
This DEPOSIT ACCOUNT CONTROL AGREEMENT (this "Agreement") is entered into as of May 19, 2023, by and among:
(1) CASCADE RETAIL OPERATING COMPANY LLC, a Delaware limited liability company (the "Account Holder" or "Customer"), with its principal office at 2200 Elliott Avenue, Suite 1400, Seattle, Washington 98121 (EIN: 83-2951047);
(2) CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States (the "Depository Bank"), with its principal office at 780 Park Avenue, 30th Floor, New York, New York 10021; and
(3) CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States, in its capacity as Collateral Agent for the benefit of the Secured Parties (as defined below) (in such capacity, the "Secured Party" or "Collateral Agent"), acting in such capacity pursuant to the Credit Agreement (as defined below), with its principal office at 780 Park Avenue, 30th Floor, New York, New York 10021.
Each of the Account Holder, the Depository Bank, and the Secured Party is sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, Account Holder maintains a deposit account at Depository Bank (as more particularly described in Section 2.1 and in Schedule A hereto, the "Account"), which is designated as a collections deposit account used to receive collections on accounts receivable, proceeds of inventory, and other related proceeds of collateral of Account Holder;
WHEREAS, the Account is identified as follows: account name — "Cascade Retail Operating Company LLC — Collections Account"; account number — as set forth on Schedule A attached hereto; maintained at the offices of Crescent Harbor Bank, National Association, 780 Park Avenue, 30th Floor, New York, New York 10021;
WHEREAS, pursuant to that certain Credit Agreement, dated as of May 4, 2023 (with an effective date of May 19, 2023), among Cascade Retail Holdings Inc., a Delaware corporation, and Cascade Retail Operating Company LLC, a Delaware limited liability company, as Borrowers, the Guarantors party thereto from time to time, the Lenders party thereto from time to time, and Crescent Harbor Bank, National Association, as Administrative Agent and Collateral Agent (as the same may be amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), providing for a $300,000,000 Senior Secured Asset-Based Revolving Credit Facility, and that certain Security Agreement, dated as of May 4, 2023, among the Grantors named therein and Crescent Harbor Bank, National Association, as Collateral Agent (as the same may be amended, restated, amended and restated, supplemented, or otherwise modified from time to time, the "Security Agreement"), Account Holder has granted a first-priority security interest in, among other things, all deposit accounts maintained by Account Holder and all funds on deposit therein, to Secured Party for the benefit of the Secured Parties (as defined in the Credit Agreement);
WHEREAS, the Parties are entering into this Agreement in order to perfect the security interest of Secured Party in the Account pursuant to Article 9 of the Uniform Commercial Code as in effect in the State of New York (the "UCC") and to establish the respective rights and obligations of the Parties with respect to the Account; and
WHEREAS, the Parties acknowledge that Crescent Harbor Bank, National Association is acting under this Agreement in the dual capacity of Depository Bank and Collateral Agent, and that its obligations and rights in each such capacity are separate and distinct as more fully set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE 1 — DEFINITIONS
Section 1.1 — Defined Terms
As used in this Agreement, the following terms shall have the meanings set forth below:
"Account" means the deposit account described in Section 2.1 hereof and more particularly identified in Schedule A attached hereto, together with any successor account or replacement account established at Depository Bank in substitution therefor, and all funds, financial assets, investment property, and other amounts or property at any time credited to or held in such account, and all proceeds thereof.
"Account Holder" means Cascade Retail Operating Company LLC, a Delaware limited liability company.
"Activation Notice" means a written notice from the Secured Party to the Depository Bank, substantially in the form attached hereto as Exhibit A, directing the Depository Bank to comply solely with instructions originated by the Secured Party (and to cease complying with instructions of the Account Holder) regarding the disposition of funds in the Account, without further consent of the Account Holder. An Activation Notice is also referred to herein as a "Notice of Exclusive Control."
"Cash Dominion Period" means any period during which (a) Availability (as defined in the Credit Agreement) is less than $37,500,000 (which represents 12.5% of the lesser of (i) the Aggregate Commitments of $300,000,000 and (ii) the Borrowing Base (as defined in the Credit Agreement)), or (b) an Event of Default under the Credit Agreement has occurred and is continuing.
"Collateral Agent" means Crescent Harbor Bank, National Association, in its capacity as collateral agent for the benefit of the Secured Parties under the Security Agreement and the other Loan Documents.
"Credit Agreement" means the Credit Agreement, dated as of May 4, 2023, among Cascade Retail Holdings Inc. and Cascade Retail Operating Company LLC, as Borrowers, the Guarantors party thereto from time to time, the Lenders party thereto from time to time, and Crescent Harbor Bank, National Association, as Administrative Agent and Collateral Agent, providing for a $300,000,000 Senior Secured Asset-Based Revolving Credit Facility, as the same may be amended, restated, amended and restated, supplemented, waived, or otherwise modified from time to time in accordance with its terms.
"Deactivation Notice" means a written notice from the Secured Party to the Depository Bank, substantially in the form attached hereto as Exhibit B, revoking a previously delivered Activation Notice and directing the Depository Bank to resume complying with the instructions of the Account Holder regarding the Account.
"Depository Bank" means Crescent Harbor Bank, National Association, in its capacity as the banking institution at which the Account is established and maintained.
"Event of Default" has the meaning assigned to such term in the Credit Agreement.
"Loan Documents" has the meaning assigned to such term in the Credit Agreement.
"Permitted Charges" has the meaning assigned to such term in Section 4.1 hereof.
"Secured Parties" has the meaning assigned to such term in the Credit Agreement, and includes the Administrative Agent, the Collateral Agent, the Lenders, and the other secured parties identified therein.
"Security Agreement" means the Security Agreement, dated as of May 4, 2023, among the Grantors named therein and Crescent Harbor Bank, National Association, as Collateral Agent, as the same may be amended, restated, amended and restated, supplemented, or otherwise modified from time to time in accordance with its terms.
"UCC" means the Uniform Commercial Code as in effect in the State of New York, as the same may be amended or supplemented from time to time.
Section 1.2 — UCC Terms
Terms used but not otherwise defined in this Agreement that are defined in Articles 8 or 9 of the UCC shall have the respective meanings assigned to such terms therein. Without limiting the generality of the foregoing, the terms "control," "deposit account," "financial asset," "proceeds," and "security interest" shall have the meanings ascribed to such terms in the UCC.
Section 1.3 — Credit Agreement Terms
Capitalized terms used but not otherwise defined in this Agreement or in the UCC shall have the respective meanings assigned to such terms in the Credit Agreement. In the event of any conflict between the definitions set forth in this Agreement and those set forth in the UCC or the Credit Agreement, the definitions set forth in this Agreement shall control for purposes of interpreting this Agreement.
ARTICLE 2 — THE ACCOUNT
Section 2.1 — Identification of Account
The Account that is the subject of this Agreement is the deposit account maintained at Depository Bank and identified as follows:
Account Name: Cascade Retail Operating Company LLC — Collections Account
Account Number: As set forth on Schedule A hereto
Account Type: Commercial demand deposit account
Financial Institution: Crescent Harbor Bank, National Association, 780 Park Avenue, 30th Floor, New York, New York 10021
ABA Routing Number: As set forth on Schedule A hereto
The Account, together with all subaccounts, if any, maintained in connection therewith, and all funds, financial assets, investment property, and other amounts credited thereto from time to time, is subject to the terms and conditions of this Agreement. In the event the Account is renumbered or redesignated by Depository Bank for any reason (including, without limitation, in connection with any system conversion or migration), such renumbered or redesignated account shall be deemed to be the "Account" for all purposes of this Agreement without the requirement of any amendment hereto.
Section 2.2 — Acknowledgment of Security Interest
(a) Depository Bank hereby acknowledges and confirms that it has been notified of, and hereby consents to, the first-priority security interest of the Secured Party in the Account and in all funds, financial assets, investment property, cash, instruments, and other property at any time credited to or held in the Account, and all proceeds thereof (collectively, the "Account Collateral").
(b) Depository Bank confirms that the Account is a "deposit account" as such term is defined in Section 9-102(a)(29) of the UCC, and that Depository Bank is the "bank" (as such term is defined in Section 9-102(a)(8) of the UCC) at which the Account is maintained.
(c) Depository Bank acknowledges and agrees that this Agreement is intended to, and does, constitute "control" by the Secured Party over the Account within the meaning of Section 9-104 of the UCC, and that the Secured Party has "control" of the Account for purposes of perfecting the Secured Party's security interest in the Account under Section 9-314 of the UCC. Depository Bank agrees to cooperate with the Secured Party as reasonably necessary to confirm and maintain such control.
Section 2.3 — Dual Capacity Acknowledgment
The Parties acknowledge and agree that Crescent Harbor Bank, National Association is acting in the dual capacity of (i) Depository Bank (the bank at which the Account is maintained) and (ii) Collateral Agent (on behalf of the Secured Parties) under this Agreement. Depository Bank's obligations and rights in its capacity as Depository Bank are separate and distinct from its obligations and rights in its capacity as Collateral Agent. All references in this Agreement to instructions, notices, or communications from or to the "Secured Party" or the "Collateral Agent" shall mean instructions, notices, or communications delivered by or to authorized representatives of Crescent Harbor Bank, National Association acting in its capacity as Collateral Agent, as identified in the notice provisions of Article 9 hereof. For the avoidance of doubt, the internal routing and delivery of any Activation Notice, Deactivation Notice, or other instruction from Collateral Agent to Depository Bank shall be governed by the internal procedures of Crescent Harbor Bank, National Association, and the effectiveness of any such notice or instruction shall not be impaired by reason of the dual capacity of Crescent Harbor Bank, National Association under this Agreement.
ARTICLE 3 — CONTROL AND INSTRUCTIONS
Section 3.1 — Compliance with Instructions of Secured Party
(a) Depository Bank hereby agrees that it shall comply with all instructions originated by the Secured Party directing the disposition of funds in the Account, without further consent of the Account Holder. Such instructions may include, without limitation, instructions to transfer, sweep, wire, redirect, or otherwise dispose of all or any portion of the funds in the Account to any account designated by the Secured Party, including without limitation any concentration account maintained at Crescent Harbor Bank, National Association or at any other financial institution designated by the Secured Party.
(b) The obligation of Depository Bank to comply with the instructions of the Secured Party as set forth in this Section 3.1 is unconditional and irrevocable from and after the date of Depository Bank's receipt of an Activation Notice (or at any time during a Cash Dominion Period or upon the occurrence and during the continuance of an Event of Default), and Depository Bank shall not require the consent, approval, or authorization of Account Holder as a condition to such compliance. Depository Bank shall not be required to determine whether the Secured Party is entitled to issue any such instruction and shall be fully protected in relying upon and complying with any such instruction.
(c) Even prior to receipt of an Activation Notice, the Secured Party shall have the right under this Agreement to originate instructions to Depository Bank regarding the disposition of funds in the Account, and Depository Bank agrees to comply with such instructions, subject to Section 3.2 below.
Section 3.2 — Account Holder's Rights Prior to Activation Notice
(a) Until such time as the Depository Bank receives an Activation Notice from the Secured Party (or the Secured Party otherwise delivers written instructions to Depository Bank inconsistent with the Account Holder's instructions), the Account Holder shall be entitled to withdraw funds from, and otherwise direct the disposition of funds in, the Account in the ordinary course of its business, subject in all respects to the terms of Depository Bank's standard account agreements and operating procedures applicable to the Account.
(b) Depository Bank shall follow the instructions of Account Holder with respect to the Account so long as (i) no Activation Notice has been delivered to and received by Depository Bank and remains in effect, and (ii) no conflicting instruction has been received from the Secured Party. In the event of any conflict between instructions received from the Account Holder and instructions received from the Secured Party, the instructions of the Secured Party shall prevail.
Section 3.3 — Activation Notice / Cash Dominion
(a) The Secured Party may deliver an Activation Notice to Depository Bank at any time during a Cash Dominion Period (that is, at any time when Availability under the Credit Agreement is less than $37,500,000, or upon the occurrence and during the continuance of an Event of Default under the Credit Agreement). The Activation Notice shall be in writing and substantially in the form attached hereto as Exhibit A.
(b) Upon receipt of an Activation Notice by Depository Bank, Depository Bank shall immediately and without further action:
(i) cease complying with any and all instructions of the Account Holder regarding the Account, including, without limitation, instructions to transfer, withdraw, or otherwise dispose of funds in the Account;
(ii) comply solely with the instructions of the Secured Party with respect to all funds in the Account; and
(iii) unless otherwise instructed by the Secured Party, sweep all available funds in the Account on a daily basis to the concentration account at Crescent Harbor Bank, National Association designated by the Secured Party in the Activation Notice or in a separate written instruction.
(c) The Activation Notice shall remain in full force and effect until such time as the Secured Party delivers a written notice to Depository Bank revoking the Activation Notice (a "Deactivation Notice"), substantially in the form attached hereto as Exhibit B. Upon Depository Bank's receipt of a Deactivation Notice, Depository Bank shall resume complying with the instructions of the Account Holder in accordance with Section 3.2 hereof. The Secured Party may deliver multiple Activation Notices and Deactivation Notices during the term of this Agreement.
(d) Account Holder acknowledges and agrees that it has no right to object to or contest any Activation Notice delivered by the Secured Party to Depository Bank, and that Account Holder's sole remedy with respect to any such Activation Notice shall be against the Secured Party under the Credit Agreement or the Security Agreement. Depository Bank shall have no obligation to provide notice to Account Holder of the receipt of an Activation Notice, although Depository Bank may, in its sole discretion, elect to provide such notice.
Section 3.4 — Form of Instructions
(a) Instructions from the Secured Party to Depository Bank may be in writing, including by electronic mail transmission from the authorized representatives of the Secured Party identified in the notice provisions of Article 9 hereof, or from such other authorized representatives as the Secured Party may designate from time to time in a written notice to Depository Bank.
(b) All instructions, Activation Notices, and Deactivation Notices shall be delivered to Depository Bank at the address and to the attention of the individual(s) set forth in Section 9.1 hereof, or to such other address or individual as Depository Bank may designate from time to time in a written notice to the Secured Party.
(c) Depository Bank shall be entitled to rely on any instruction, notice, or communication that it reasonably believes to be genuine and to have been given or signed by an authorized representative of the Secured Party. Depository Bank shall have no obligation to verify or authenticate any instruction, notice, or communication, provided that Depository Bank acts in good faith and in accordance with reasonable commercial standards.
Section 3.5 — No Duty to Investigate
Depository Bank shall have no duty or obligation to investigate or make any determination as to whether the Secured Party is entitled to deliver an Activation Notice, a Deactivation Notice, or any other instruction with respect to the Account, including, without limitation, whether a Cash Dominion Period has commenced or is continuing, whether Availability is less than $37,500,000, whether an Event of Default has occurred, or whether any other condition precedent to the Secured Party's exercise of its rights under this Agreement or the Credit Agreement has been satisfied. Depository Bank shall be fully protected in relying on and complying with any Activation Notice, Deactivation Notice, or other instruction delivered by the Secured Party, and Account Holder hereby releases Depository Bank from any liability arising from such reliance and compliance.
ARTICLE 4 — SUBORDINATION OF DEPOSITORY BANK'S RIGHTS
Section 4.1 — Subordination of Liens and Set-Off Rights
(a) Depository Bank hereby subordinates any and all security interests, liens, encumbrances, claims, or rights of set-off that Depository Bank may now or hereafter have (whether arising by operation of law, by contract, under any deposit account agreement, or otherwise) in or against the Account and the funds, financial assets, investment property, cash, instruments, and other property at any time credited to or held in the Account, to the first-priority security interest of the Secured Party in the Account and the Account Collateral.
(b) Notwithstanding the foregoing, Depository Bank does not subordinate and expressly reserves:
(i) its right to debit the Account in the ordinary course for customary account maintenance fees, service charges, returned-item charges, overdraft charges, and wire transfer fees, in each case in accordance with Depository Bank's standard fee schedule as in effect from time to time (collectively, "Permitted Charges"); and
(ii) any lien, claim, or right arising in its separate capacity as Collateral Agent under the Security Agreement or the other Loan Documents.
(c) The subordination set forth in this Section 4.1 is irrevocable and unconditional and shall remain in effect until the termination of this Agreement in accordance with Article 8.
Section 4.2 — No Liens by Depository Bank
(a) Depository Bank agrees that it will not assert any possessory lien, banker's lien, right of set-off, or other lien or encumbrance against the Account or any funds, financial assets, or other property credited to or held in the Account, except for Permitted Charges as described in Section 4.1(b)(i) above.
(b) Depository Bank agrees that it will not exercise any right of set-off, recoupment, or counterclaim against the Account or the funds therein in satisfaction of any claim, debt, or obligation of Account Holder to Depository Bank that is unrelated to the Permitted Charges, unless Depository Bank has received the prior written consent of the Secured Party.
ARTICLE 5 — ACCOUNT HOLDER'S REPRESENTATIONS AND COVENANTS
Section 5.1 — Representations of Account Holder
Account Holder hereby represents and warrants to the Secured Party and the Depository Bank as of the date hereof as follows:
(a) Organization and Existence. Account Holder is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware, with taxpayer identification number (EIN) 83-2951047.
(b) Power and Authority. Account Holder has full limited liability company power and authority to enter into this Agreement, to perform its obligations hereunder, and to grant and to acknowledge the security interest of the Secured Party in the Account and the Account Collateral as contemplated hereby. The execution, delivery, and performance of this Agreement by Account Holder have been duly authorized by all necessary limited liability company action on the part of Account Holder.
(c) Enforceability. This Agreement has been duly executed and delivered by Account Holder and constitutes the legal, valid, and binding obligation of Account Holder, enforceable against Account Holder in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other similar laws relating to or affecting the enforcement of creditors' rights generally, and (ii) general principles of equity (whether considered in a proceeding in equity or at law).
(d) Exact Legal Name. Account Holder's exact legal name as it appears on its Certificate of Formation filed with the Secretary of State of the State of Delaware is "Cascade Retail Operating Company LLC."
(e) No Other Control Agreements. The Account is not subject to any other deposit account control agreement, and no person other than the Secured Party has "control" (as defined in Section 9-104 of the UCC) over the Account. The Account is not subject to any lien, security interest, or encumbrance other than (i) the first-priority security interest of the Secured Party as contemplated by this Agreement and the Security Agreement, and (ii) such rights as Depository Bank may have with respect to Permitted Charges.
(f) No Conflicts. The execution, delivery, and performance of this Agreement by Account Holder do not and will not (i) violate any provision of Account Holder's organizational documents, (ii) conflict with, result in a breach of, or constitute a default under any agreement or instrument to which Account Holder is a party or by which Account Holder or its assets are bound, or (iii) violate any applicable law, rule, or regulation.
Section 5.2 — Covenants of Account Holder
Account Holder hereby covenants and agrees with the Secured Party and the Depository Bank as follows:
(a) No Closing or Modification. Account Holder shall not, without the prior written consent of the Secured Party: (i) close the Account; (ii) change the name on the Account; (iii) change the account number of the Account; or (iv) add or remove any authorized signatory on the Account (other than in the ordinary course of business in connection with personnel changes, provided that the Secured Party is promptly notified of any such change).
(b) No Other Control Agreements. Account Holder shall not enter into any other deposit account control agreement or similar agreement with respect to the Account, and shall not grant or permit any other person to obtain "control" (as defined in Section 9-104 of the UCC) over the Account, without the prior written consent of the Secured Party.
(c) Notification of Changes. Account Holder shall promptly notify the Secured Party in writing of any change in (i) Account Holder's legal name, (ii) Account Holder's jurisdiction of organization, (iii) Account Holder's organizational identification number or taxpayer identification number, or (iv) any other matter that could reasonably be expected to affect the validity or perfection of the Secured Party's security interest in the Account.
(d) Compliance with Agreements. Account Holder shall comply with and perform all of its obligations under the Credit Agreement, the Security Agreement, and the other Loan Documents with respect to the Account.
ARTICLE 6 — DEPOSITORY BANK'S REPRESENTATIONS, COVENANTS, AND AGREEMENTS
Section 6.1 — Representations of Depository Bank
Depository Bank hereby represents and warrants to the Secured Party and the Account Holder as of the date hereof as follows:
(a) Organization and Existence. Depository Bank is a national banking association duly organized, validly existing, and in good standing under the laws of the United States, chartered by and subject to the supervision of the Office of the Comptroller of the Currency.
(b) Power and Authority. Depository Bank has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The execution, delivery, and performance of this Agreement by Depository Bank have been duly authorized by all necessary corporate action on the part of Depository Bank.
(c) No Other Agreements. The Account has been established and is maintained at Depository Bank. As of the date hereof, the Account is not subject to any deposit account control agreement, pledge agreement, or similar agreement in favor of any person other than the Secured Party. Depository Bank has not entered into, and will not enter into, any agreement with any person (other than the Secured Party and the Account Holder) relating to the Account pursuant to which Depository Bank has agreed, or will agree, to comply with instructions from such person regarding the Account.
Section 6.2 — Maintenance of Account
(a) Depository Bank shall maintain the Account in accordance with its standard terms and conditions for commercial deposit accounts, as modified by the terms of this Agreement. To the extent of any inconsistency between Depository Bank's standard terms and conditions and this Agreement, this Agreement shall control.
(b) Depository Bank shall not close the Account or change the account number of the Account without providing the Secured Party with at least thirty (30) days' prior written notice. Depository Bank shall not be required to maintain the Account if the maintenance thereof would be in violation of any applicable law, regulation, or court order, provided that Depository Bank shall provide the Secured Party with prompt written notice of any such determination.
Section 6.3 — Account Statements and Information
(a) Depository Bank shall provide the Secured Party (in its capacity as Collateral Agent) with periodic account statements for the Account at the same time and in the same manner as such statements are provided to the Account Holder. Account statements shall be provided on a monthly basis, or more frequently if so requested by the Secured Party during a Cash Dominion Period or upon the occurrence and during the continuance of an Event of Default.
(b) Depository Bank shall, upon the reasonable request of the Secured Party, promptly provide the Secured Party with information regarding the current balance of the Account, recent transaction history, and such other information regarding the Account as the Secured Party may reasonably request from time to time.
(c) Account Holder hereby authorizes and directs Depository Bank to provide the Secured Party with all account statements, balance information, transaction history, and other information regarding the Account as contemplated by this Section 6.3, and Account Holder agrees that the provision of such information by Depository Bank to the Secured Party shall not constitute a breach of any duty of confidentiality owed by Depository Bank to Account Holder.
Section 6.4 — No Adverse Claims
Except for (a) the claims and interests of the Account Holder as the owner of the Account and (b) the security interest and other rights of the Secured Party in the Account as provided in this Agreement, Depository Bank does not, as of the date hereof, know of any claim to, lien on, or interest in the Account or the funds on deposit therein. If Depository Bank becomes aware of any such adverse claim, lien, or interest, Depository Bank shall promptly notify the Secured Party in writing.
ARTICLE 7 — INDEMNIFICATION AND LIABILITY
Section 7.1 — Indemnification of Depository Bank
(a) Account Holder and the Secured Party (in its capacity as Collateral Agent, and solely to the extent permitted by and in accordance with the Loan Documents) shall, jointly and severally, indemnify, defend, and hold harmless Depository Bank (solely in its capacity as Depository Bank hereunder, and not in its capacity as Collateral Agent) and its officers, directors, employees, agents, and representatives (each, an "Indemnified Party") from and against any and all claims, demands, actions, suits, proceedings, damages, losses, liabilities, costs, and expenses (including, without limitation, reasonable attorneys' fees and disbursements) (collectively, "Losses") arising out of, relating to, or in connection with this Agreement or the Account, including, without limitation, Losses arising from Depository Bank's compliance in good faith with instructions from the Secured Party or the Account Holder, except to the extent that such Losses are determined by a court of competent jurisdiction by final, non-appealable judgment to have resulted directly from Depository Bank's own gross negligence or willful misconduct.
(b) The indemnification obligations set forth in this Section 7.1 shall survive the termination of this Agreement and shall remain in full force and effect until the expiration of all applicable statutes of limitation with respect to any claim for indemnification hereunder.
Section 7.2 — Limitation of Depository Bank's Liability
(a) Depository Bank shall not be liable for any losses, damages, claims, costs, or expenses arising from or in connection with its compliance in good faith with any instructions, Activation Notices, Deactivation Notices, or other directions received from the Secured Party.
(b) Depository Bank shall have no duty or obligation to monitor the Account, the Borrowing Base, Availability, the financial condition of the Account Holder or any other Borrower or Guarantor under the Credit Agreement, or any other metric, covenant, or condition under the Credit Agreement, the Security Agreement, or any other Loan Document. Depository Bank shall not be required to determine whether the conditions precedent to the delivery of an Activation Notice or any other instruction by the Secured Party have been satisfied or whether an Event of Default has occurred or is continuing.
(c) In no event shall Depository Bank be liable for any indirect, consequential, special, punitive, or exemplary damages, or for any lost profits or loss of business opportunity, regardless of whether Depository Bank has been advised of the possibility of such damages.
(d) Depository Bank's aggregate liability under this Agreement shall in no event exceed the balance in the Account at the time of the relevant event giving rise to such liability.
(e) Depository Bank shall not be liable for any delay or failure to perform its obligations under this Agreement to the extent that such delay or failure results from circumstances beyond Depository Bank's reasonable control, including, without limitation, acts of God, fire, flood, earthquake, pandemic, strikes, labor disputes, governmental actions, power failures, equipment malfunctions, or interruptions in telecommunications or electronic systems.
Section 7.3 — Depository Bank Fees
Account Holder shall pay all customary fees and charges of Depository Bank related to the establishment, maintenance, and operation of the Account in accordance with Depository Bank's standard fee schedule as in effect from time to time. Such fees and charges may be debited directly from the Account as Permitted Charges in accordance with Section 4.1(b)(i) hereof.
ARTICLE 8 — TERMINATION
Section 8.1 — Termination by Secured Party
This Agreement shall terminate upon written notice from the Secured Party to the Depository Bank and the Account Holder stating that (a) the security interest of the Secured Party in the Account has been released in accordance with the terms of the Credit Agreement and the Security Agreement, and (b) all obligations of the Borrowers under the Credit Agreement and the other Loan Documents have been indefeasibly paid in full in cash and all commitments of the Lenders thereunder have been irrevocably terminated. Upon receipt of such written notice, Depository Bank shall be entitled to rely conclusively on such notice, and from and after the effective date of such termination, Depository Bank shall have no further obligation to comply with the instructions of the Secured Party under this Agreement.
Section 8.2 — Termination upon Closing of Account
If the Account is closed in accordance with the terms of this Agreement and the applicable deposit account agreements, and with the prior written consent of the Secured Party, this Agreement shall automatically terminate upon such closing without the necessity of any further action or notice by any Party.
Section 8.3 — Effect of Termination
(a) Upon termination of this Agreement in accordance with Section 8.1 or Section 8.2, the obligations of Depository Bank under this Agreement (other than those expressly surviving termination as set forth herein) shall cease, and the Secured Party shall have no further rights under this Agreement with respect to the Account.
(b) The following provisions shall survive the termination of this Agreement: Section 7.1 (Indemnification of Depository Bank), Section 7.2 (Limitation of Depository Bank's Liability), Section 10.1 (Governing Law), Section 10.2 (Submission to Jurisdiction), and Section 10.3 (Waiver of Jury Trial).
ARTICLE 9 — NOTICES
Section 9.1 — Notice Addresses
All notices, requests, demands, consents, instructions, Activation Notices, Deactivation Notices, and other communications required or permitted under this Agreement shall be directed to the following addresses (or to such other addresses as a Party may designate by written notice to the other Parties in accordance with this Article 9):
If to Account Holder:
Cascade Retail Operating Company LLC 2200 Elliott Avenue, Suite 1400 Seattle, Washington 98121
Attention: Derek Tanaka, General Counsel
and: Priya Anand, Treasurer
Email: dtanaka@cascaderetail.com; panand@cascaderetail.com
With a copy to (which shall not constitute notice):
Calderwood & Harkness LLP 599 Lexington Avenue, 42nd Floor New York, New York 10022
Attention: Claudia Merritt
Email: cmerritt@calderwoodharkness.com
If to Depository Bank:
Crescent Harbor Bank, National Association 780 Park Avenue, 30th Floor New York, New York 10021
Attention: Julianne Strickland, Vice President, Portfolio Management
Email: julianne.strickland@crescentharbor.com
If to Secured Party / Collateral Agent:
Crescent Harbor Bank, National Association 780 Park Avenue, 30th Floor New York, New York 10021
Attention: Thomas Reiland, Managing Director, ABL Origination
Email: thomas.reiland@crescentharbor.com
With a copy to (which shall not constitute notice):
Whitfield, Greer & Holloway LLP 51 West 52nd Street, 35th Floor New York, New York 10019
Attention: Bernard Ashford
Email: bashford@wghlegal.com
Section 9.2 — Methods of Notice
(a) All notices and other communications under this Agreement shall be in writing and shall be delivered by (i) personal delivery (including by messenger or courier service), (ii) nationally recognized overnight courier service (with all charges prepaid), or (iii) electronic mail transmission (with confirmation of transmission by the sender). Notices shall be deemed to have been duly given and shall be effective upon actual receipt by the intended recipient.
(b) Notwithstanding the foregoing, Activation Notices and Deactivation Notices may be delivered by electronic mail to the designated email addresses set forth in Section 9.1 above (or to such other email addresses as Depository Bank may designate in writing from time to time) and shall be effective immediately upon receipt by Depository Bank. The Secured Party shall use commercially reasonable efforts to provide telephonic confirmation of any Activation Notice or Deactivation Notice delivered by electronic mail, but the effectiveness of any such notice shall not be conditioned upon such telephonic confirmation.
ARTICLE 10 — GOVERNING LAW; JURISDICTION; MISCELLANEOUS
Section 10.1 — Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to any conflicts of law principles thereof that would require or permit the application of the laws of any other jurisdiction. For purposes of the UCC, the State of New York shall be the "bank's jurisdiction" (as defined in Section 9-304 of the UCC) with respect to the Account.
Section 10.2 — Submission to Jurisdiction
Each Party hereby irrevocably and unconditionally submits to the exclusive jurisdiction of the United States District Court for the Southern District of New York and the Supreme Court of the State of New York, New York County, in each case sitting in the Borough of Manhattan, for the purpose of any action, suit, or proceeding arising out of or relating to this Agreement, and each Party hereby irrevocably and unconditionally waives, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of venue of any such action, suit, or proceeding in any such court and any claim that any such action, suit, or proceeding has been brought in an inconvenient forum.
Section 10.3 — Waiver of Jury Trial
EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING, CLAIM, OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT ACTION, SUIT, OR PROCEEDING. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT, OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) EACH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.3.
Section 10.4 — Amendments
This Agreement may not be amended, modified, or supplemented except by a written instrument duly executed by each of the Parties hereto. No waiver of any provision of this Agreement shall be effective unless such waiver is in writing and signed by the Party against whom enforcement of such waiver is sought.
Section 10.5 — Successors and Assigns
This Agreement shall be binding upon and shall inure to the benefit of the Parties hereto and their respective successors and permitted assigns. Account Holder may not assign its rights or obligations under this Agreement without the prior written consent of the Secured Party. The Secured Party may assign its rights under this Agreement to any successor Collateral Agent appointed in accordance with the Credit Agreement without the consent of Account Holder or Depository Bank, provided that the Secured Party provides written notice of such assignment to Depository Bank and Account Holder. Depository Bank may not assign its rights or obligations under this Agreement without the prior written consent of the Secured Party and Account Holder.
Section 10.6 — Conflict with Other Agreements
(a) In the event of any conflict or inconsistency between the terms of this Agreement and the terms of any other agreement between Depository Bank and Account Holder relating to the Account (including, without limitation, any standard deposit account agreement, account documentation, or treasury management services agreement), the terms of this Agreement shall control and prevail.
(b) In the event of any conflict or inconsistency between the terms of this Agreement and the terms of the Credit Agreement or the Security Agreement, as between the Secured Party and Account Holder, the terms of the Credit Agreement or the Security Agreement, as applicable, shall govern as between those Parties; provided, however, that Depository Bank shall be entitled to rely exclusively on the terms of this Agreement with respect to its obligations and rights hereunder, and Depository Bank shall have no obligation to inquire into or comply with the terms of the Credit Agreement or the Security Agreement.
Section 10.7 — Severability
If any provision of this Agreement is held to be invalid, illegal, or unenforceable by any court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Agreement, and the remaining provisions shall continue in full force and effect. The Parties shall endeavor in good faith to replace any invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that reflects the original intent of the Parties as nearly as possible.
Section 10.8 — Counterparts
This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall constitute an original, and all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by facsimile transmission or by electronic transmission in portable document format (".pdf") or similar format shall be effective as delivery of a manually executed counterpart of this Agreement. Each Party agrees that the electronic signatures appearing on this Agreement are the same as handwritten signatures for the purposes of validity, enforceability, and admissibility.
Section 10.9 — Entire Agreement
This Agreement (together with the Schedules and Exhibits attached hereto, which are incorporated herein by reference) constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, warranties, commitments, offers, agreements, and understandings (whether written or oral) among the Parties with respect to such subject matter.
Section 10.10 — Relationship to Credit Agreement
This Agreement constitutes a "Loan Document" as such term is defined in the Credit Agreement. The rights and remedies of the Secured Party under this Agreement are in addition to, and not in limitation or substitution of, the rights and remedies of the Secured Party under the Credit Agreement, the Security Agreement, and the other Loan Documents. Nothing in this Agreement shall be construed to limit or impair any right or remedy of the Secured Party under the Credit Agreement, the Security Agreement, the UCC, or applicable law.
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SIGNATURE PAGES TO DEPOSIT ACCOUNT CONTROL AGREEMENT
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed and delivered by their respective authorized officers or representatives as of the date first written above.
ACCOUNT HOLDER:
CASCADE RETAIL OPERATING COMPANY LLC
By: ________
Name: Elena Kowalski
Title: Chief Financial Officer of Cascade Retail Holdings Inc., sole member of Cascade Retail Operating Company LLC
Date: May 19, 2023
DEPOSITORY BANK:
CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, as Depository Bank