DEPOSIT ACCOUNT CONTROL AGREEMENT
Dated as of May 19, 2023
among
CASCADE DIGITAL COMMERCE INC., a Delaware corporation, as Account Holder
NORTHGATE CAPITAL BANK, a New York state-chartered bank, as Depository Bank
and
CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, a national banking association organized under the laws of the United States, as Collateral Agent
DEPOSIT ACCOUNT CONTROL AGREEMENT
This DEPOSIT ACCOUNT CONTROL AGREEMENT (this "Agreement") is entered into as of May 19, 2023, by and among:
(1) CASCADE DIGITAL COMMERCE INC., a corporation organized and existing under the laws of the State of Delaware (the "Account Holder" or "Customer"), with its principal office located at 500 Fremont Street, Suite 200, Portland, Oregon 97209, EIN: 84-3720158;
(2) NORTHGATE CAPITAL BANK, a bank organized and chartered under the laws of the State of New York (the "Depository Bank"), with offices located at 400 Lexington Avenue, 18th Floor, New York, New York 10170; and
(3) CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States (the "Secured Party" or "Collateral Agent"), with offices located at 780 Park Avenue, 30th Floor, New York, New York 10021, acting in its capacity as Collateral Agent under the Credit Agreement (as defined below).
The Account Holder, the Depository Bank, and the Collateral Agent are sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
A. Reference is hereby made to that certain Credit Agreement dated as of May 4, 2023 (effective May 19, 2023) (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement"), among Cascade Retail Holdings Inc., a corporation organized under the laws of the State of Delaware, and Cascade Retail Operating Company LLC, a limited liability company organized under the laws of the State of Delaware, as Borrowers, the Guarantors party thereto (including the Account Holder), the Lenders party thereto from time to time, and Crescent Harbor Bank, National Association, as Administrative Agent and Collateral Agent, providing for a Three Hundred Million Dollar ($300,000,000) Senior Secured Asset-Based Revolving Credit Facility (the "Revolving Credit Facility").
B. Reference is further made to that certain Security Agreement dated as of May 4, 2023 (as amended, restated, supplemented, or otherwise modified from time to time, the "Security Agreement"), among the Grantors party thereto (including Cascade Digital Commerce Inc.) and Crescent Harbor Bank, National Association, as Collateral Agent for the benefit of the Secured Parties, pursuant to which the Account Holder has granted a first-priority security interest in, among other things, all deposit accounts maintained by the Account Holder at any financial institution and all proceeds thereof, to the Collateral Agent for the benefit of the Secured Parties.
C. The Account Holder maintains a deposit account at the Depository Bank identified in Section 1.1 below (the "Account"), and the Parties are entering into this Agreement to perfect the Collateral Agent's security interest in the Account and all funds on deposit therein, and all interest, dividends, and other proceeds credited thereto, pursuant to and in accordance with the requirements of the Credit Agreement and the Security Agreement.
D. The Depository Bank is a Lender under the Credit Agreement with a Revolving Commitment of Ninety Million Dollars ($90,000,000), representing thirty percent (30%) of the aggregate Revolving Commitments under the Credit Agreement.
E. Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Credit Agreement or the Security Agreement, as applicable.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants and agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
SECTION 1 — THE ACCOUNT
1.1 Account Identification. The deposit account that is the subject of this Agreement is identified as follows:
The Account is used as the collections account for the Account Holder's e-commerce receivables and is subject to the cash management arrangements described in the Credit Agreement. The Depository Bank confirms that the Account identified above is a valid and existing deposit account maintained at the Depository Bank in the name of the Account Holder.
1.2 Existing Funds and Future Deposits. All funds now or hereafter on deposit in the Account, together with all interest, dividends, income, and other proceeds credited thereto, whether by deposit, wire transfer, automated clearing house ("ACH") credit, check, draft, or any other means, and all replacements, substitutions, and additions thereto, constitute "Collateral" for purposes of this Agreement and are subject to the security interest of the Collateral Agent granted pursuant to the Security Agreement. The Account Holder acknowledges that the security interest of the Collateral Agent attaches to all such funds and proceeds upon deposit into the Account or credit thereto.
1.3 No Other Agreements. The Depository Bank represents and warrants to the Collateral Agent that, as of the date hereof: (a) it has not entered into any other deposit account control agreement, blocked account agreement, or similar agreement with any third party with respect to the Account; (b) no person other than the Account Holder and, upon effectiveness of this Agreement, the Collateral Agent, has "control" (as such term is defined in Section 9-104 of the Uniform Commercial Code as in effect in the State of New York (the "UCC")) over the Account; and (c) it has not received any other instructions from any person claiming a security interest in, lien upon, or right of setoff against the Account (other than the Depository Bank's own rights as set forth in Section 4.1 hereof). The Depository Bank covenants that it will not enter into any such agreement or arrangement with any third party with respect to the Account without the prior written consent of the Collateral Agent.
SECTION 2 — CONTROL
2.1 Establishment of Control. The Depository Bank hereby agrees that it will comply with instructions originated by the Collateral Agent directing disposition of the funds in the Account without further consent of the Account Holder, thereby establishing "control" by the Collateral Agent over the Account within the meaning of Sections 9-104(a)(2) and 8-106 of the UCC as in effect in the State of New York. The Depository Bank acknowledges that, by entering into this Agreement and agreeing to comply with such instructions without the further consent of the Account Holder, the Collateral Agent has obtained "control" over the Account for purposes of perfecting the Collateral Agent's security interest therein under Article 9 of the UCC. The obligations of the Depository Bank under this Section 2.1 are unconditional and shall not be subject to any defense, counterclaim, setoff, or recoupment that the Depository Bank may have against the Account Holder, the Collateral Agent, or any other person, except as expressly provided in Section 4.1 hereof.
2.2 Priority of Instructions. Until the Depository Bank receives an Activation Notice (as defined in Section 3.1 hereof), the Account Holder may give instructions to the Depository Bank with respect to the disposition of funds in the Account in the ordinary course of business, including, without limitation, instructions to transfer, withdraw, or otherwise direct the disposition of funds in the Account. The Depository Bank shall comply with such instructions from the Account Holder in accordance with its standard terms and conditions for commercial deposit accounts. After receipt of an Activation Notice and until receipt of a Deactivation Notice (as defined in Section 3.3 hereof), the Depository Bank shall follow only the instructions of the Collateral Agent with respect to the Account and shall not comply with any instruction from the Account Holder or any other person (other than the Collateral Agent) directing the disposition of funds in the Account. For the avoidance of doubt, during the period in which an Activation Notice is in effect, the Depository Bank shall not honor any check, draft, wire transfer request, ACH debit, or other withdrawal or payment instruction with respect to the Account unless such instruction has been originated by or approved in writing by the Collateral Agent.
2.3 No Duty to Investigate. The Depository Bank shall not be required to investigate or determine whether the Collateral Agent is entitled to deliver an Activation Notice, a Deactivation Notice, or any other instruction with respect to the Account. The Depository Bank may rely conclusively on any instruction, notice, or other communication that it reasonably believes to have been originated by the Collateral Agent, and shall have no liability to any Party for acting in reliance thereon. The Depository Bank shall be entitled to accept and act upon any such instruction, notice, or communication that is delivered in accordance with Section 11 hereof and that bears the signature (including an electronic or facsimile signature) of a person identified by the Collateral Agent as an authorized representative. The Collateral Agent agrees to provide the Depository Bank with a list of authorized signatories and specimen signatures, and to promptly notify the Depository Bank of any changes thereto.
SECTION 3 — ACTIVATION NOTICE (CASH DOMINION)
3.1 Definition of Activation Notice. An "Activation Notice" is a written notice from the Collateral Agent to the Depository Bank stating that the Collateral Agent is exercising exclusive control over the Account. The Activation Notice shall be substantially in the form attached hereto as Exhibit A. The Collateral Agent may deliver an Activation Notice to the Depository Bank at any time when:
(a) Availability (as defined in the Credit Agreement) falls below twelve and one-half percent (12.5%) of the lesser of (i) the Aggregate Commitments and (ii) the Borrowing Base (which threshold, as of the Closing Date of the Credit Agreement, equals Thirty-Seven Million Five Hundred Thousand Dollars ($37,500,000), calculated as 12.5% multiplied by Three Hundred Million Dollars ($300,000,000) of Aggregate Commitments); or
(b) an Event of Default (as defined in the Credit Agreement) has occurred and is continuing.
The Collateral Agent shall use commercially reasonable efforts to simultaneously provide a copy of any Activation Notice delivered to the Depository Bank to the Account Holder, but the failure to provide such copy to the Account Holder shall not affect the validity or effectiveness of the Activation Notice as between the Collateral Agent and the Depository Bank. The Depository Bank shall be entitled to rely conclusively on any Activation Notice and shall not be required to verify that the conditions described in clause (a) or clause (b) above have been satisfied or are continuing.
3.2 Effect of Activation Notice. Upon receipt by the Depository Bank of an Activation Notice, the Depository Bank shall:
(a) immediately cease complying with any and all instructions from the Account Holder or any person acting on behalf of the Account Holder regarding the disposition of funds in the Account, including without limitation any standing instructions, automatic payment arrangements, wire transfer instructions, or ACH debit authorizations previously given by the Account Holder;
(b) comply solely with instructions originated by the Collateral Agent or its authorized representatives regarding the disposition of funds in the Account; and
(c) if instructed by the Collateral Agent, sweep or transfer all funds then on deposit in the Account and all funds thereafter deposited in the Account on a daily basis (or at such other frequency as directed by the Collateral Agent) to such account or accounts as may be designated by the Collateral Agent in writing, including, without limitation, the concentration account maintained at Crescent Harbor Bank, National Association, or any other account designated by the Collateral Agent.
The Depository Bank shall implement the instructions set forth in an Activation Notice no later than the close of business on the business day following the business day on which the Depository Bank receives such Activation Notice (or, if received before 12:00 noon, New York City time, on a business day, by the close of business on such business day). The Account shall remain open following receipt of an Activation Notice unless otherwise instructed by the Collateral Agent, and the Depository Bank shall continue to accept deposits and credits to the Account in the ordinary course.
3.3 Deactivation Notice. The Collateral Agent may at any time deliver a written notice to the Depository Bank (a "Deactivation Notice") rescinding a previously delivered Activation Notice. The Deactivation Notice shall be substantially in the form attached hereto as Exhibit B. Upon receipt by the Depository Bank of a Deactivation Notice, the Account Holder's rights to direct the disposition of funds in the Account shall be restored, and the Depository Bank shall resume complying with instructions from the Account Holder in the ordinary course of business, in each case subject to the delivery of a subsequent Activation Notice by the Collateral Agent in accordance with this Section 3. The Depository Bank shall implement a Deactivation Notice no later than the close of business on the business day following the business day on which the Depository Bank receives such Deactivation Notice. The delivery of a Deactivation Notice shall not affect, limit, or impair the Collateral Agent's right to deliver a subsequent Activation Notice at any time in accordance with Section 3.1 hereof.
3.4 Form of Notices. Activation Notices and Deactivation Notices shall be substantially in the forms attached hereto as Exhibit A and Exhibit B, respectively, and shall be delivered in accordance with Section 11 of this Agreement. Any material variation from the forms attached as exhibits hereto shall not invalidate an Activation Notice or Deactivation Notice provided that such notice clearly identifies the Account and states its purpose.
SECTION 4 — SUBORDINATION OF DEPOSITORY BANK'S RIGHTS
4.1 Subordination of Liens. The Depository Bank hereby subordinates in favor of the Collateral Agent any and all security interests, liens, encumbrances, claims, or rights of setoff that the Depository Bank may have, now or in the future, whether arising by operation of law, contract, or otherwise, in or to the Account or any funds on deposit therein or credited thereto, except for:
(a) the Depository Bank's right to debit the Account for its customary and published fees, charges, and expenses for the maintenance and administration of the Account, including without limitation monthly maintenance fees, wire transfer fees, ACH processing fees, check processing fees, and charges for returned items, in each case as specified in the Depository Bank's standard fee schedule provided to the Account Holder (collectively, "Bank Charges"); and
(b) the Depository Bank's right to recover amounts advanced by the Depository Bank to cover overdrafts in the Account, including any provisional credits extended by the Depository Bank pending collection of deposited items.
The subordination set forth in this Section 4.1 shall be effective and enforceable against the Depository Bank regardless of (i) the time of creation, attachment, or perfection of the Depository Bank's security interest, lien, or other right as compared to the Collateral Agent's security interest, (ii) the order of filing of any financing statements, and (iii) any provision of the UCC or other applicable law to the contrary. The Depository Bank acknowledges that the subordination set forth herein is a material inducement for the Collateral Agent to enter into this Agreement.
4.2 No Setoff. Except as expressly set forth in Section 4.1 hereof, the Depository Bank agrees that it will not exercise any right of setoff, recoupment, banker's lien, counterclaim, or similar right against the funds in the Account or any interest or proceeds thereof, without the prior written consent of the Collateral Agent. This restriction on setoff applies to all obligations of the Account Holder to the Depository Bank, whether now existing or hereafter arising, whether under the Credit Agreement (in the Depository Bank's capacity as a Lender thereunder) or otherwise, and whether or not such obligations are matured, unmatured, liquidated, unliquidated, fixed, contingent, or disputed.
SECTION 5 — DEPOSITORY BANK'S REPRESENTATIONS AND COVENANTS
5.1 Maintenance of Account. The Depository Bank shall maintain the Account in accordance with its standard terms and conditions for commercial deposit accounts, as such terms and conditions may be amended, modified, or supplemented from time to time in the ordinary course of the Depository Bank's business (the "Account Agreement"). The Depository Bank shall provide the Account Holder and the Collateral Agent with copies of any material amendments to the Account Agreement that affect the rights and obligations of the Parties under this Agreement. In the event of any conflict between the Account Agreement and this Agreement, the terms of this Agreement shall govern and control.
5.2 No Encumbrances. The Depository Bank covenants and agrees that it will not agree with any third party that the Depository Bank will comply with instructions from such third party regarding the disposition of funds in the Account, or otherwise grant or permit any third party to obtain "control" (within the meaning of UCC Section 9-104) over the Account, without the prior written consent of the Collateral Agent. The Depository Bank further covenants that it will not create, permit, or suffer to exist any lien, security interest, or encumbrance in favor of any third party on the Account or any funds therein (other than the security interest of the Collateral Agent) without the prior written consent of the Collateral Agent.
5.3 Statements and Notices. The Depository Bank shall send copies of all periodic account statements for the Account to both the Account Holder and the Collateral Agent at the addresses set forth in Section 11 hereof (or via electronic means, including secure email or online banking portal access, as the Parties may agree in writing from time to time). Such statements shall be provided at least monthly, or more frequently if reasonably requested by the Collateral Agent. The Depository Bank shall promptly, and in any event within two (2) business days, notify the Collateral Agent if any legal process, including, without limitation, any garnishment order, writ of attachment, levy, restraining notice, tax lien notice, or similar process or order, is served on or received by the Depository Bank with respect to the Account. The Depository Bank shall also promptly notify the Collateral Agent if the Depository Bank becomes aware of any adverse claim to the Account or the funds therein asserted by any person other than the Account Holder or the Collateral Agent.
5.4 Account Changes. The Depository Bank shall not change the name, title, designation, or account number of the Account without providing at least thirty (30) days' prior written notice to the Collateral Agent and the Account Holder. Such notice shall include the proposed new account name or number, the effective date of such change, and any other information reasonably necessary for the Collateral Agent to maintain the perfection and priority of its security interest in the Account.
5.5 Conflicting Agreements. In the event of any conflict between the terms of this Agreement and any other agreement between the Depository Bank and the Account Holder (including, without limitation, the Account Agreement, any treasury management agreement, or any other deposit account agreement), the terms of this Agreement shall govern and control with respect to the subject matter hereof, including without limitation matters relating to the Collateral Agent's control over the Account, the priority of instructions, and the subordination of the Depository Bank's rights.
SECTION 6 — ACCOUNT HOLDER'S REPRESENTATIONS AND COVENANTS
6.1 Ownership. The Account Holder represents and warrants to the Collateral Agent and the Depository Bank that it is the sole legal and beneficial owner of the Account and all funds on deposit therein. The Account Holder has not assigned, transferred, pledged, hypothecated, or otherwise encumbered any interest in the Account or the funds therein to any person other than the Collateral Agent pursuant to the Security Agreement. No person other than the Account Holder and the Collateral Agent has any right, title, or interest in or to the Account or the funds therein, and no person other than the Account Holder has the right to make deposits to or withdrawals from the Account (subject to the Collateral Agent's rights under this Agreement).
6.2 No Other Control Agreements. The Account Holder represents and warrants that, as of the date hereof, it has not entered into any deposit account control agreement, blocked account agreement, or similar arrangement or agreement with any person with respect to the Account. The Account Holder covenants that it will not enter into any such agreement or arrangement with respect to the Account without the prior written consent of the Collateral Agent. The Account Holder further covenants that it will not grant any person other than the Collateral Agent "control" (within the meaning of UCC Section 9-104) over the Account.
6.3 Authorization. The Account Holder represents and warrants that it has full corporate power and authority to execute, deliver, and perform its obligations under this Agreement. The execution and delivery of this Agreement and the performance by the Account Holder of its obligations hereunder have been duly authorized by all necessary corporate action on the part of the Account Holder, and no other corporate proceedings or approvals are necessary in connection therewith. This Agreement has been duly executed and delivered by the Account Holder and constitutes the legal, valid, and binding obligation of the Account Holder, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and other laws affecting creditors' rights generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity). Cascade Digital Commerce Inc. is a wholly owned subsidiary of Cascade Retail Operating Company LLC, a limited liability company organized under the laws of the State of Delaware, which is in turn a wholly owned subsidiary of Cascade Retail Holdings Inc., a corporation organized under the laws of the State of Delaware.
6.4 Security Interest. The Account Holder hereby acknowledges and confirms the grant of a first-priority security interest in the Account and all funds now or hereafter on deposit therein, and all proceeds and products thereof, to the Collateral Agent for the benefit of the Secured Parties pursuant to the Security Agreement. The Account Holder acknowledges that this Agreement is being entered into in order to perfect such security interest through "control" under the UCC, and the Account Holder agrees to cooperate with the Collateral Agent and the Depository Bank in taking any further action that may be necessary or desirable to maintain the perfection and priority of such security interest.
SECTION 7 — COLLATERAL AGENT'S RIGHTS
7.1 Directions Regarding Funds. The Collateral Agent shall have the right, at any time after delivery of an Activation Notice in accordance with Section 3 hereof, to instruct the Depository Bank to:
(a) transfer any or all funds in the Account by wire transfer, ACH transfer, or other means to one or more accounts at any financial institution designated by the Collateral Agent, including, without limitation, the concentration account maintained by the Collateral Agent at Crescent Harbor Bank, National Association;
(b) pay any or all funds in the Account directly to or for the benefit of the Collateral Agent or such other person or persons as the Collateral Agent may direct;
(c) hold funds in the Account and not permit any withdrawal, transfer, or other disposition of such funds except as directed by the Collateral Agent; or
(d) take any other action with respect to the Account or the funds therein as permitted under applicable law, including the UCC as in effect in the State of New York.
The Depository Bank shall carry out any such instruction from the Collateral Agent promptly and in accordance with the time frames set forth in Section 3.2 hereof or as otherwise specified in such instruction. The Collateral Agent's instructions may be given by any means permitted under Section 11 hereof.
7.2 No Obligation to Act. Prior to delivering an Activation Notice, the Collateral Agent is under no obligation to give any instruction to the Depository Bank regarding the Account or the funds therein. The Collateral Agent shall have no liability to the Account Holder, the Depository Bank, or any other person for exercising or not exercising its rights under this Agreement, or for the timing, manner, or consequences of any exercise or non-exercise of such rights, in each case except to the extent resulting from the Collateral Agent's gross negligence or willful misconduct. Nothing in this Agreement shall be construed to impose upon the Collateral Agent any duty to monitor the balance or activity of the Account.
7.3 Sole Remedy. The Account Holder acknowledges and agrees that the Collateral Agent's rights under this Agreement are cumulative with, and not in limitation of, any and all other rights and remedies of the Collateral Agent under the Security Agreement, the Credit Agreement, and applicable law, including without limitation the right to foreclose on the Collateral, the right to apply proceeds of the Collateral to the Obligations, and any other rights available to a secured party under Article 9 of the UCC. The exercise by the Collateral Agent of any right or remedy under this Agreement shall not preclude the simultaneous or subsequent exercise of any other right or remedy.
SECTION 8 — RESPONSIBILITY OF DEPOSITORY BANK
8.1 Standard of Care. The Depository Bank shall act in accordance with its standard practices and procedures for commercial deposit accounts and shall exercise the same degree of care in the discharge of its obligations under this Agreement as it exercises with respect to its own property of a like kind and nature. The Depository Bank shall not be deemed a fiduciary of the Account Holder, the Collateral Agent, or any other person by reason of this Agreement.
8.2 Limitation of Liability. The Depository Bank shall not be liable for any loss, claim, damage, expense, or liability of any kind arising out of or in connection with any act or omission taken or suffered by the Depository Bank in good faith in reliance on instructions, notices, or other communications that it reasonably believes to have been originated by the appropriate Party in accordance with this Agreement, except to the extent that such loss, claim, damage, expense, or liability results directly from the Depository Bank's own gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final, non-appealable judgment. In no event shall the Depository Bank be liable for any indirect, special, consequential, punitive, or exemplary damages of any kind, regardless of the form of action or theory of liability, even if the Depository Bank has been advised of the possibility of such damages.
8.3 No Duty to Monitor. The Depository Bank has no duty to monitor the Account, the transactions in or affecting the Account, or the obligations of any Party under the Credit Agreement, the Security Agreement, or any other Loan Document. The Depository Bank shall have no obligation to determine whether an Event of Default has occurred or is continuing under the Credit Agreement, whether Availability has fallen below any applicable threshold, or whether the Collateral Agent is entitled to deliver an Activation Notice. The Depository Bank shall have no responsibility to verify the accuracy of any representation or statement made by any Party to this Agreement and shall be entitled to rely conclusively on the representations, warranties, and certifications of the other Parties contained herein.
8.4 Indemnification. The Account Holder and the Collateral Agent, jointly and severally, shall indemnify, defend, and hold harmless the Depository Bank and its officers, directors, employees, agents, and affiliates (collectively, the "Depository Bank Indemnified Parties") from and against any and all claims, losses, liabilities, damages, judgments, costs, and expenses (including reasonable and documented attorneys' fees and disbursements) arising out of or related to this Agreement or the Depository Bank's performance hereunder, except to the extent that any such claim, loss, liability, damage, judgment, cost, or expense is caused by or results from the Depository Bank's own gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final, non-appealable judgment. As between the Account Holder and the Collateral Agent, the Account Holder shall bear the primary obligation of indemnification hereunder, and the Collateral Agent's indemnification obligation shall apply only to the extent that the Account Holder fails to satisfy its indemnification obligations after demand therefor. The obligations of the Account Holder and the Collateral Agent under this Section 8.4 shall survive the termination of this Agreement and the closing of the Account.
SECTION 9 — TERMINATION
9.1 Termination by Collateral Agent. This Agreement may be terminated at any time by the Collateral Agent by delivering written notice of termination to the Depository Bank and the Account Holder. Such termination shall be effective upon receipt of such notice by the Depository Bank (or on such later date as may be specified in such notice). Upon termination of this Agreement by the Collateral Agent, the Depository Bank shall have no further obligations under this Agreement (other than obligations that have accrued prior to the effective date of such termination, including without limitation the indemnification obligations set forth in Section 8.4 hereof and any obligation to complete transactions initiated prior to the effective date of termination).
9.2 Termination by Account Holder. This Agreement may not be terminated by the Account Holder without the prior written consent of the Collateral Agent. Any purported termination of this Agreement by the Account Holder without such consent shall be void and of no force or effect. The Account Holder acknowledges that the Collateral Agent's consent to termination may be withheld in the Collateral Agent's sole and absolute discretion.
9.3 Termination by Depository Bank. The Depository Bank may terminate this Agreement upon thirty (30) days' prior written notice to the Collateral Agent and the Account Holder; provided, however, that:
(a) such termination shall not be effective until the earlier of (i) the date on which the Collateral Agent confirms in writing to the Depository Bank that the Collateral Agent has established a replacement deposit account at another depository institution and has entered into a replacement deposit account control agreement with respect thereto, and (ii) the date that is sixty (60) days after the date of such notice; and
(b) the Depository Bank shall continue to comply fully with the terms and provisions of this Agreement during the notice period and any extension thereof, including without limitation compliance with any Activation Notice then in effect.
9.4 Closure of Account. The Account shall not be closed by the Account Holder or the Depository Bank without the prior written consent of the Collateral Agent. If the Account is closed for any reason (including upon termination of this Agreement, by operation of law, or pursuant to the terms of the Account Agreement), any funds remaining in the Account at the time of closure shall be remitted to the Collateral Agent by wire transfer to such account as the Collateral Agent may designate in writing, unless the Collateral Agent otherwise directs in writing. The Depository Bank shall notify the Collateral Agent promptly in writing of any circumstances that may result in the closure of the Account.
9.5 Survival. The indemnification obligations of Section 8.4 hereof, the subordination provisions of Section 4 hereof, and the provisions of Section 10 (Governing Law; Jurisdiction; Waiver of Jury Trial) shall survive the termination of this Agreement for any reason. Any obligations that have accrued prior to the effective date of termination shall survive such termination until fully performed or discharged.
SECTION 10 — GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL
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 conflict of laws principles thereof (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law, which by their terms apply to this Agreement). To the extent not governed by the internal laws of the State of New York, this Agreement shall be governed by applicable federal law.
10.2 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, 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 it may legally and effectively do so, 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 defense of inconvenient forum to the maintenance of any such action, suit, or proceeding. Each Party agrees that a final judgment in any such action, suit, or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Section 10.2 shall affect the right of any Party to serve legal process in any other manner permitted by applicable law.
10.3 Waiver of Jury Trial. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. THIS WAIVER APPLIES WHETHER SUCH ACTION, SUIT, OR PROCEEDING IS BASED ON CONTRACT, TORT, STATUTE, OR ANY OTHER THEORY. EACH PARTY HERETO CERTIFIES THAT 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. EACH PARTY ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.3.
10.4 UCC Jurisdiction for Account. For purposes of the UCC, including without limitation Sections 9-304 and 9-305 thereof, the Depository Bank's jurisdiction (within the meaning of UCC Section 9-304) is the State of New York. The Depository Bank shall not change its jurisdiction for purposes of UCC Section 9-304 without providing at least thirty (30) days' prior written notice to the Collateral Agent.
SECTION 11 — NOTICES
11.1 General. All notices, requests, demands, instructions, and other communications under this Agreement shall be in writing and shall be deemed to have been duly given or delivered: (a) if delivered in person, upon delivery; (b) if sent by a nationally recognized overnight courier service (with all fees prepaid and with written confirmation of delivery), on the business day following the date of deposit with such courier service; or (c) if sent by email (with confirmation of receipt by the recipient, which may be by return email, read receipt, or other written acknowledgment), upon receipt of such confirmation. Any notice delivered after 5:00 p.m. (New York City time) on a business day, or on a day that is not a business day, shall be deemed to have been given on the next succeeding business day.
11.2 Notice Addresses. Notices shall be sent to the following addresses (or to such other addresses as a Party may specify by notice given in accordance with this Section 11):
If to the Account Holder:
Cascade Digital Commerce Inc. 500 Fremont Street, Suite 200 Portland, Oregon 97209
Attention: Priya Anand, Treasurer
Email: panand@cascadedigital.com
with a copy (which shall not constitute notice) to:
Derek Tanaka, General Counsel Cascade Retail Holdings Inc. 2200 Elliott Avenue, Suite 1400 Seattle, Washington 98121
Email: dtanaka@cascaderetail.com
If to the Depository Bank:
Northgate Capital Bank 400 Lexington Avenue, 18th Floor New York, New York 10170
Attention: Rajesh Mehta, Director, Leveraged & Asset-Based Lending
Email: rmehta@northgatecapital.com
If to the Collateral Agent:
Crescent Harbor Bank, National Association 780 Park Avenue, 30th Floor New York, New York 10021
Attention: Julianne Strickland, Vice President, Portfolio Management
Email: jstrickland@crescentharbor.com
with a copy (which shall not constitute notice) to:
Thomas Reiland, Managing Director, ABL Origination Crescent Harbor Bank, National Association 780 Park Avenue, 30th Floor New York, New York 10021
Email: treiland@crescentharbor.com
11.3 Changes. Any Party may change its address, email address, or designated contact person for purposes of notices under this Agreement by giving at least five (5) business days' prior written notice to the other Parties in accordance with this Section 11. Such change shall be effective upon receipt of such notice by all other Parties.
SECTION 12 — MISCELLANEOUS PROVISIONS
12.1 Entire Agreement. This Agreement, including the 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 and contemporaneous agreements, understandings, negotiations, and discussions, whether oral or written, relating to the subject matter hereof. No Party has relied on any statement, representation, or warranty of any other Party not expressly set forth in this Agreement.
12.2 Amendments. This Agreement may not be amended, modified, supplemented, or waived except by a written instrument duly executed by all three Parties. No failure or delay by any Party in exercising any right, power, or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege.
12.3 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. Neither the Account Holder nor the Depository Bank may assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the other Parties. The Collateral Agent may assign its rights and obligations under this Agreement to a successor Collateral Agent appointed under the Credit Agreement without the consent of the Depository Bank or the Account Holder, provided that written notice of such assignment is given to the Depository Bank and the Account Holder promptly following the effectiveness of such assignment, and such successor Collateral Agent shall thereupon become vested with all of the rights, powers, and duties of the Collateral Agent hereunder as fully as if such successor had been originally named as the Collateral Agent herein.
12.4 Severability. If any provision of this Agreement is held to be invalid, illegal, or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision hereof, and the remaining provisions of this Agreement shall remain in full force and effect. In the event any provision is held to be invalid, illegal, or unenforceable, the Parties agree to negotiate in good faith a substitute provision that most nearly reflects the original intent of the Parties.
12.5 Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original, and all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile transmission or by electronic means (including in portable document format (".pdf") or any electronic signature complying with the federal ESIGN Act of 2000 or the New York Electronic Signatures and Records Act) shall be as effective as delivery of a manually executed counterpart of this Agreement.
12.6 Headings. The section and subsection headings and captions used in this Agreement are included for convenience of reference only and shall not affect the construction, interpretation, or meaning of any provision of this Agreement.
12.7 Relationship to Credit Agreement. In the event of any conflict or inconsistency between the terms and provisions of this Agreement and the terms and provisions of the Credit Agreement or the Security Agreement, (a) as between the Account Holder and the Collateral Agent, the terms of the Credit Agreement or the Security Agreement, as applicable, shall control and govern, and (b) as between the Depository Bank and the other Parties with respect to the Depository Bank's rights and obligations hereunder, the terms of this Agreement shall control and govern. The Depository Bank shall not be bound by, or required to comply with, any provision of the Credit Agreement or the Security Agreement to which it is not a party (other than as a Lender under the Credit Agreement), except to the extent such provisions are expressly incorporated into and made a part of this Agreement.
12.8 No Third-Party Beneficiaries. Except for the Secured Parties (as defined in the Credit Agreement), who are intended third-party beneficiaries of this Agreement and shall be entitled to enforce the Collateral Agent's rights hereunder to the extent provided in the Credit Agreement and the Security Agreement, no person other than the Parties hereto shall have any rights, remedies, or claims under or by reason of this Agreement. Nothing in this Agreement, express or implied, is intended to or shall confer upon any person (other than the Parties and the Secured Parties) any right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.
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SIGNATURE PAGE TO DEPOSIT ACCOUNT CONTROL AGREEMENT
IN WITNESS WHEREOF, the Parties hereto have caused this Deposit Account Control Agreement to be duly executed by their respective authorized officers as of the date first written above.
CASCADE DIGITAL COMMERCE INC., as Account Holder
By: ________
Name: Priya Anand
Title: Treasurer
Date: May 19, 2023
SIGNATURE PAGE TO DEPOSIT ACCOUNT CONTROL AGREEMENT
NORTHGATE CAPITAL BANK, as Depository Bank
By: ________
Name: Rajesh Mehta
Title: Director, Leveraged & Asset-Based Lending
Date: May 19, 2023
SIGNATURE PAGE TO DEPOSIT ACCOUNT CONTROL AGREEMENT
CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, as Collateral Agent
By: ________
Name: Julianne Strickland
Title: Vice President, Portfolio Management
Date: May 19, 2023
EXHIBIT A
FORM OF ACTIVATION NOTICE
[Date]
Northgate Capital Bank 400 Lexington Avenue, 18th Floor New York, New York 10170
Attention: Rajesh Mehta, Director, Leveraged & Asset-Based Lending
Re: Activation Notice under Deposit Account Control Agreement dated as of May 19, 2023
Ladies and Gentlemen:
Reference is made to that certain Deposit Account Control Agreement dated as of May 19, 2023 (the "Control Agreement"), among Cascade Digital Commerce Inc., a Delaware corporation ("Account Holder"), Northgate Capital Bank, a New York state-chartered bank ("Depository Bank"), and Crescent Harbor Bank, National Association, a national banking association ("Collateral Agent"). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Control Agreement.
This notice constitutes an "Activation Notice" as defined in Section 3.1 of the Control Agreement. The Collateral Agent hereby notifies the Depository Bank that the Collateral Agent is exercising exclusive control over the following deposit account (the "Account"):
Account Name: Cascade Digital Commerce Inc. — Collections Account
Account Number: 7841-0039-2265
ABA/Routing Number: 021-407-612
Pursuant to Section 3.2 of the Control Agreement, effective immediately upon your receipt of this Activation Notice:
1. You are directed to cease complying with any and all instructions from the Account Holder or any person acting on behalf of the Account Holder regarding the disposition of funds in the Account.
2. You are directed to comply solely with instructions originated by the Collateral Agent or its authorized representatives regarding the disposition of funds in the Account.
3. [CHECK ONE]:
No Sweep Instruction at this time. The Collateral Agent reserves the right to provide sweep or transfer instructions at a later date.
Sweep Instruction. You are instructed to sweep and transfer all funds on deposit in the Account, and all funds hereafter deposited in the Account, on each business day to the following account designated by the Collateral Agent:
Bank: ________
Account Name: ________
Account Number: ________
ABA/Routing Number: ________
Reference: ________
Please confirm your receipt of this Activation Notice and your agreement to comply with the instructions set forth herein by executing a copy of this notice in the space provided below and returning it to the Collateral Agent at the address set forth in the Control Agreement.
Very truly yours,
CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, as Collateral Agent
By: ________
Name: ________
Title: ________
Date: ________
ACKNOWLEDGED AND AGREED:
NORTHGATE CAPITAL BANK, as Depository Bank
By: ________
Name: ________
Title: ________
Date: ________
EXHIBIT B
FORM OF DEACTIVATION NOTICE
[Date]
Northgate Capital Bank 400 Lexington Avenue, 18th Floor New York, New York 10170
Attention: Rajesh Mehta, Director, Leveraged & Asset-Based Lending
Re: Deactivation Notice under Deposit Account Control Agreement dated as of May 19, 2023
Ladies and Gentlemen:
Reference is made to that certain Deposit Account Control Agreement dated as of May 19, 2023 (the "Control Agreement"), among Cascade Digital Commerce Inc., a Delaware corporation ("Account Holder"), Northgate Capital Bank, a New York state-chartered bank ("Depository Bank"), and Crescent Harbor Bank, National Association, a national banking association ("Collateral Agent"). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Control Agreement.
Reference is further made to the Activation Notice delivered by the Collateral Agent to the Depository Bank on [date of prior Activation Notice] (the "Prior Activation Notice") with respect to the following deposit account (the "Account"):
Account Name: Cascade Digital Commerce Inc. — Collections Account
Account Number: 7841-0039-2265
ABA/Routing Number: 021-407-612
This notice constitutes a "Deactivation Notice" as defined in Section 3.3 of the Control Agreement. The Collateral Agent hereby rescinds the Prior Activation Notice, effective upon your receipt of this Deactivation Notice.
Pursuant to Section 3.3 of the Control Agreement, upon receipt of this Deactivation Notice, the Account Holder's rights to direct the disposition of funds in the Account are restored, and the Depository Bank shall resume complying with instructions from the Account Holder in the ordinary course of business, in each case subject to the delivery of a subsequent Activation Notice by the Collateral Agent in accordance with the Control Agreement.
This Deactivation Notice shall not affect, limit, or impair the Collateral Agent's right to deliver a subsequent Activation Notice at any time in accordance with the Control Agreement.
Please confirm your receipt of this Deactivation Notice by executing a copy of this notice in the space provided below and returning it to the Collateral Agent at the address set forth in the Control Agreement.
Very truly yours,
CRESCENT HARBOR BANK, NATIONAL ASSOCIATION, as Collateral Agent
By: ________
Name: ________
Title: ________
Date: ________
ACKNOWLEDGED AND AGREED:
NORTHGATE CAPITAL BANK, as Depository Bank
By: ________
Name: ________
Title: ________
Date: ________