DAMIS Holdings - Chapter 11 DIP Terms

$2.2M 2195 Harlem Road / Bank of New Hampshire DIP Terms

Borrower(s) / Guarantor(s)

• 2195 Harlem Road Leasing LLC and 2195 Harlem Road Real Estate LLC, as borrowers, two single-asset entities holding the leasehold interest in the mortgaged property
• The prepetition loan is guaranteed by debtors DAMIS Holdings LLC and SIMAD Holdings LLC, and by non-debtors Michael Aaron Shabsels and David Arthur Shabsels, each of whom has a Chapter 11 case pending in the same district (Case Nos. 26-16529 and 26-16530), under separate continuing guaranties dated June 27, 2024. The final order specifies, notwithstanding anything in the DIP loan documents, that DAMIS Holdings LLC and SIMAD Holdings LLC are not parties to the DIP facility.

Agent / Lender(s)

• Bank of New Hampshire, which serves as both the prepetition secured lender under the June 27, 2024 loan agreement and the DIP lender

DIP Commitments

• $2.2 million of postpetition, superpriority secured protective advances, structured not as a new facility but as advances under Sections 4.11, 7.6, and 7.8 of the existing leasehold mortgage, which authorize the lender to advance to protect its collateral:
  • Up to $651,000 available upon entry of the interim order, entered Sept. 25, 2026
  • The remaining $1,549,000 available upon entry of the final order, entered Oct. 2, 2026
• The DIP obligations constitute additional obligations under the existing loan documents, secured by the prepetition liens including the leasehold mortgage, effective immediately. There is no roll-up of the prepetition debt.
• Upon entry of the final order, the borrowers are authorized to borrow up to the full amount of the protective advances without further action by any party. The final order continues to describe the final tranche as "no less than" $1,549,000, while the motion caps it at up to that amount and the term sheet calls it the remaining principal amount, with the same order's $2.2 million aggregate ceiling bounding the two tranches together.
• Amendments, waivers and other modifications to the DIP loan documents that are not material require no further court approval, and must be given to the U.S. Trustee and committee counsel substantially concurrently with being implemented; the shared services line item in any amended approved budget may not be reduced from the prior approved budget without the committee's consent.
• Upon entry of the final order the DIP loan documents govern the facility, and until they are executed and delivered the debtors and the lender are bound by the term sheet as if executed. Where the documents conflict, the final order controls over the DIP loan documents, the motion [D.I. 1144], the earlier interim cash collateral orders [D.I. 281, 423, 579, 724] and the interim order [Doc 1231]; as between the motion and the DIP loan documents, the loan documents govern.
• The chief restructuring officer, Perry Mandarino, concluded that the borrowers require up to $2.2 million to fund preservation and operation of the property through the anticipated sale process [D.I. 157, 1177].

Prepetition Debt

• The lender advanced $11 million under the June 27, 2024 loan agreement and promissory note; as of the petition date the borrowers and their debtor guarantors were jointly and severally liable for principal of not less than $10,682,225.41, plus accrued interest, costs, fees, and expenses. The debtors made their stipulations under the interim order and reaffirm them in the final order.
• The prepetition liens are first-priority and encumber the borrowers' leasehold interest in 2195 Harlem Road (Thruway Plaza), Cheektowaga, New York, demised under a June 27, 2024 ground lease from Equity Holdings of Cheektowaga LLC, together with all improvements, plus all other collateral described in the existing loan documents.
• The leasehold mortgage and the assignment of leases and rents were recorded Sept. 11, 2024 with the Erie County Clerk's Office at Book 14137, Pages 3418 and 3463. A June 27, 2024 ground lessor estoppel and recognition agreement with Equity Holdings of Cheektowaga LLC was recorded the same day at Book 14135, Page 7632.
• Barclays Capital Real Estate Inc. holds the fee mortgage, subject to a Sept. 30, 2025 recognition, subordination, non-disturbance and attornment agreement among the fee mortgagee, the ground lessor, the borrowers and the lender.

Cash Collateral

• The final order authorizes the borrowers to use all of the lender's cash collateral, solely as permitted by the final order and the approved budget, through the termination date. Cash collateral is defined as all of the borrowers' cash, amounts on deposit in any account, receivable collections and other dispositions of prepetition collateral, rents collected on and after the petition date, and all proceeds of the foregoing.
• Cash collateral, rather than DIP proceeds, funds the categories that cannot be structured as protective advances: professional fees, general bankruptcy administration costs, and adequate protection payments.
• The court had previously authorized the borrowers' use of the lender's cash collateral on an interim basis under a series of orders [D.I. 281, 423, 579, 724] entered on the separate cash collateral motion filed June 24, 2026 [D.I. 152].
• The borrowers stipulate that, as of the petition date, they maintained no bank accounts other than those listed on Exhibit 1 to the cash management order [D.I. 219].

Interest Rate

• 11.25% per annum, the default rate under the existing loan documents, comprising the 7.25% contract rate stated in the promissory note plus a 4.00% default premium
• Default Rate Increase: 5.0% (500 basis points) after maturity or an event of default
• Interest accrues and is added to the outstanding principal balance on the first day of each month following the first advance, calculated on actual days elapsed over a 360-day year. All accrued and unpaid interest is due in cash on the maturity date, together with remaining accrued interest on the prepetition obligations, principal, late fees, and the lender's legal fees and disbursements.
• The term sheet has DIP interest capitalizing into principal and payable in cash only at maturity, while the budget exhibit carries DIP interest as a cash payment monthly in arrears.

Fees

• No upfront fees, commitment fees, or unused line fees.
• Lender Professional Fees: the borrowers reimburse the reasonable and documented fees and expenses of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. and any other lender-retained professionals for negotiating, documenting, administering, monitoring, or enforcing the DIP loan documents. These fees are not subject to court approval or fee applications.
• Fees and expenses of the lender's counsel incurred on or before the petition date are payable on the funding date of the interim advances, outside the invoice-review procedure.
• Invoices are payable within a 10-calendar-day review period after receipt by the debtors, the committee, and the U.S. Trustee. A written objection within that period limits payment to the unobjected amounts pending agreement or a court order. Invoices must carry a general description of matters, timekeepers, hourly rates, hours billed and, for law firms, year of law school graduation, with privilege redactions preserved and the U.S. Trustee's right to seek unredacted copies reserved.

Maturity

• The earliest to occur of:
  • Six months from the date of issuance, subject to an automatic 60-day extension if a sale of the loan parties' real property has been approved but remains pending closing
  • The effective date of a confirmed Chapter 11 plan
  • Closing of a sale or other disposition of all or a substantial portion of the loan parties' assets
  • Conversion of any of the cases to Chapter 7
  • Dismissal of any of the cases
  • Appointment of a Chapter 11 trustee
  • Acceleration of the DIP loan and termination of further advances following an event of default
• The parties may agree in writing to extend the maturity date. The final order provides that, following a termination consistent with the term sheet, all DIP obligations are immediately due and payable, the commitments terminate, and authority to use cash collateral ceases, subject to limited use during the remedies notice period.
• Mandatory prepayment applies 100% of net cash proceeds to the outstanding obligations upon:
  • A non-ordinary-course sale or disposition of collateral
  • Insurance, casualty or condemnation payments
  • Any debt or equity issuance
  • Recoveries on claims and causes of action
• Notwithstanding anything else in the final order, upon the closing of any sale of all or substantially all of a borrower's assets, the borrowers are directed to pay the net sale proceeds to the lender up to the amount of the prepetition obligations and the DIP obligations, subject to the rights of a party in interest to assert a challenge.
• The DIP obligations are not discharged by confirmation of a plan of reorganization or liquidation; they must be paid in full on the plan effective date, and the borrowers have waived discharge as to those amounts under section 1141(d)(4).
• The DIP liens, superpriority claims and remedies survive until one of the following occurs:
  • The DIP obligations are paid in full in cash and the commitments terminate
  • The debtors consummate an acceptable plan, which the final order defines as one acceptable in form and substance to the lender, paying the DIP obligations in full in cash on the effective date, and not impairing the lender's claims or liens without its written consent
• The adequate protection obligations run until the earlier of that plan's consummation and repayment in full in cash of the prepetition obligations and adequate protection obligations.

Carve Out

• Consists of the sum of:
  • Clerk and U.S. Trustee fees under 28 U.S.C. § 1930(a) plus statutory interest, which are not subject to any budget
  • Chapter 7 trustee fees and expenses under section 726(b) on conversion, in an aggregate amount not to exceed $50,000
  • The cumulative amount of shared services payable by the borrowers to DAMIS Holdings LLC under the approved budget through the end of the budget period, to the extent not otherwise funded
• The carve-out is senior to all liens and claims securing the DIP obligations, the adequate protection liens and superpriority claims, and every other lien or claim granted by the final order. Any payment of the carve-out is added to the DIP obligations and secured by the DIP collateral.
• No portion of the carve-out, cash collateral, or DIP proceeds may fund a challenge to the lender's liens or claims or any action against the lender, subject to the committee's investigation rights described below. The carve-out is not a cap on Clerk or U.S. Trustee fees, professional fees, or intercompany administrative claims, though nothing in that provision increases the carve-out.
• The carve-out carries no component for the fees of professionals retained by the debtors or the committee. The final order provides that the lender is not responsible for paying or reimbursing any professional's fees or the fees of the U.S. Trustee or the Clerk; those fees are funded from cash collateral under the approved budget.

Use of Proceeds

• Proceeds may be used solely for the preservation, maintenance, management, operation, and re-leasing of the mortgaged property, including maintenance and repairs, capital expenditures, tenant improvements, broker's fees, ground rent, insurance, real estate taxes, and utilities. All uses must accord with the approved budget and be expressly authorized to be advanced under the post-default provisions of the leasehold mortgage.
• Proceeds may not fund the debtors' general bankruptcy administration costs or any cost not directly incident to the property or its income-producing capacity. They may not satisfy any obligation of a non-borrower debtor except indirectly through shared services payments made under the approved budget.

Credit Bid

• Under the term sheet, the lender may credit bid all or any portion of the DIP obligations and the prepetition obligations under section 363(k) in connection with any sale of the prepetition collateral or other borrower assets, whether under section 363 or a plan of reorganization. The term sheet requires the orders to authorize a credit bid of the full amount of the obligations without further order of the court; the final order itself contains no credit bid paragraph.

Avoidance Actions

• Under the final order, the DIP superpriority claims are payable from, and the first-priority lien on unencumbered property extends to, the proceeds of chapter 5 avoidance actions. The lender may recover from avoidance-action proceeds only after recovering from all other DIP collateral and proceeds.

Challenge Period and Budget

• The facility is expressly conditioned on the debtors' stipulation to the validity, enforceability, allowability, priority, secured status, perfection, and amount of the prepetition obligations and the first-priority status of the prepetition liens, and on their waiver and release of any right to challenge them. Those stipulations, made under the interim order and reaffirmed in the final order, bind the debtors and their estates as of the petition date and extend to all DIP loans made.
• Any other party in interest with court-granted standing must file an adversary proceeding or contested matter on or before Nov. 21, 2026 under the final order; the term sheet sets the challenge deadline at Nov. 13, 2026. On conversion to Chapter 7 or appointment of a Chapter 11 trustee before that date, the period extends to the later of the time remaining and 45 days after the appointment.
• A standing motion with a draft complaint attached tolls the challenge period only as to the moving party, only as to the claims in the draft complaint, and only until two business days after the motion is resolved; a separate standing order is a prerequisite to prosecuting a challenge.
• Absent a timely challenge, or if a challenge is overruled, the prepetition obligations become allowed claims not subject to counterclaim, setoff, recoupment, reduction, subordination, recharacterization, defense, or avoidance, and the prepetition liens are deemed legal, valid, binding, and perfected as of the petition date. No challenge may be asserted against amounts advanced under the DIP facility.
• Investigation Budget: the committee or a Chapter 7 or Chapter 11 trustee may use DIP proceeds, DIP collateral, or prepetition collateral including cash collateral solely to investigate potential claims against the prepetition lender within the challenge period, subject to an aggregate cap of $50,000.

Securities and Priorities

• Because the same institution is both prepetition and DIP lender, the DIP liens are granted pari passu with the prepetition liens to the extent they secure protective advances under the leasehold mortgage, a structure the debtors describe as consistent with the lender's existing contractual rights.
• Subject to the Carve-Out, the DIP obligations are allowed superpriority administrative expense claims under section 364(c)(1) against each borrower's estate, senior to all other administrative expenses and claims. These include claims under sections 503(b), 506(c), 507(a) other than 507(a)(1), 507(b), 726, 1113, and 1114, and administrative claims arising under the final cash management order, whose docket number the final order leaves blank. They are treated as allowed section 503(b) expenses for purposes of section 1129(a)(9)(A).
• No other superpriority claim may be granted unless junior to the DIP superpriority claims and adequate protection claims and consented to by the lender.
• Effective as of entry of the final order, the lender is granted automatically perfected DIP liens on all prepetition and postpetition property of the borrowers and proceeds, including proceeds of claims and causes of action, with the following priorities:
  • Section 364(c)(2): first-priority senior liens on all unencumbered property, including unencumbered cash, receivables, leasehold interests, and avoidance-action proceeds
  • Section 364(c)(3): liens on all other property, junior only to permitted liens, limited to statutory tax liens not yet due or contested in good faith and ordinary-course mechanics', materialmen's, warehousemen's, carriers', repairmen's, and landlord's liens, with no lien securing borrowed money, funded debt, letter-of-credit obligations, or other financing obligations qualifying
  • Section 364(d)(1): first-priority senior priming liens on all DIP collateral, senior to all existing liens other than permitted liens and the prepetition liens, with holders of the primed liens deemed to have consented
  • Notwithstanding the foregoing, the DIP liens are pari passu with the prepetition liens
• The DIP liens survive conversion or dismissal, are enforceable against any trustee, may not be made junior or pari passu with any later-granted lien other than the prepetition liens, and are not subject to sections 510, 549, or 550.
• Lease and license anti-assignment provisions requiring counterparty consent or payment of fees to a governmental entity are deemed inconsistent with the Bankruptcy Code and have no effect on the grant of the DIP liens. Any counterparty's right to object to assumption or assignment on other grounds is preserved. The lien-grant paragraph excepts nonresidential real property leases from that override, while a parallel provision later in the same order carries no such exception and reaches leasehold interests expressly.
• Nothing in the final order modifies, primes, limits or expands the terms of any surety bonds, related indemnity agreements, or the rights of the debtors' sureties in their collateral.
• Insurance: the borrowers must maintain casualty and loss coverage on the prepetition and DIP collateral as required by the loan documents and name the lender as loss payee or additional insured until the DIP obligations are paid in full.

Adequate Protection

Bank of New Hampshire

• Monthly cash interest on the prepetition obligations at the 7.25% non-default contract rate on the $10,682,225.41 principal balance outstanding as of the petition date, as reduced over time by principal payments. The final order makes the payments due on the first business day of each month following its own entry, while the term sheet runs them from entry of the interim order.
• Monthly principal amortization payments as set forth in the approved budget, plus payment of outstanding real estate taxes as budgeted
• Section 507(b) superpriority administrative expense claims for any diminution in value, subject and subordinate only to the Carve-Out and the DIP superpriority claims and senior to all other claims against the borrowers' estates, including administrative expense claims under the final cash management order
• Payment of the reasonable and documented out-of-pocket fees, costs, and expenses of the lender, including those of Mintz Levin as prepetition lender's counsel, without separate court approval
• Maintenance of cash management arrangements consistent with the final cash management order and compliance with all reporting requirements in the DIP loan documents and the final order, with the committee entitled to request reporting; failure to comply is an event of default
• The lender is deemed to have requested stay relief and adequate protection for any diminution in value from and after the petition date. The final order preserves its section 507(b) rights and its right to seek additional or alternative adequate protection, without any finding that the protection granted is in fact adequate or that the lender is entitled to postpetition interest under section 506(b).

Mizzen Capital, LP

• Mizzen, which claims a security interest in certain borrower assets, receives a replacement perfected security interest under section 361(2) in all borrower assets, subject to three limits:
  • Only to the extent of diminution in value of its collateral
  • Only to the extent its prepetition claim and lien are valid
  • With the same priority it held as of the petition date, subordinate in all respects to the Carve-Out and the DIP liens
  The motion describes those replacement liens as also subordinate to the adequate protection liens and the prepetition liens.
• The replacement lien is deemed perfected on entry of the final order without possession or filings.
• To the extent that protection proves insufficient, Mizzen receives a section 507(b) superpriority claim for the shortfall, senior to section 507(a)(2) claims other than the Carve-Out, the DIP superpriority claims, and, where the prepetition liens are senior to Mizzen's, the lender's adequate protection claims.
• Mizzen is to receive copies of all reporting delivered to the lender and retains the adequate protection granted under the interim cash collateral orders. The final order retains language reserving Mizzen's right to object to the motion on a further interim basis or at a final hearing.

Waivers

• Under the final order, in consideration of the lender's agreement to permit the Carve-Out and the use of its cash collateral:
  • Section 506(c): no administration expenses may be charged against or recovered from the DIP collateral or the prepetition collateral, except to the extent of the Carve-Out, or from the lender, without its prior written consent
  • Section 552(b): the "equities of the case" exception does not apply to the proceeds, products, offspring, or profits of the prepetition collateral
  • Marshaling and similar doctrines do not apply, except that the lender must recover from avoidance-action proceeds only after exhausting all other available DIP and prepetition collateral
• Upon entry of the final order, and subject only to third-party challenge rights, the debtors and their estates release the lender in both capacities and its affiliates, advisors, and representatives from all claims relating to the DIP and prepetition obligations, liens, and loan documents. The release covers lender-liability and equitable subordination theories and any attack on the validity, priority, extent, enforceability, perfection, or avoidability of the lender's liens and claims. It excepts only claims that a court determines by final, non-appealable order primarily result from bad faith, fraud, gross negligence, or willful misconduct.

Permitted Variance

• Operating disbursements for any one-week period may not exceed 115% of budgeted disbursements on an aggregate basis; favorable variances may be carried forward and added to permitted disbursements in a subsequent testing period.
• Testing begins two weeks after entry of the interim order and runs each Friday, measured as of the week ending two Sundays prior to the current week.
• Variance reports are due to the lender, its advisors, and committee counsel by 5:00 p.m. prevailing Eastern time each Friday beginning after the second full week. Each report must explain every material variance and state whether it is temporary or permanent; beginning the third week, the reports must carry line-item commentary on every favorable and unfavorable deviation greater than $50,000.
• The approved budget, prepared by the debtors and approved by the lender, covers the period from the filing of the motion through Dec. 31, 2026 on a weekly line-item basis, though the budget exhibit itself runs as a cash flow forecast through Jan. 1, 2027. Its weekly lines carry rent income of $165,800, ancillary income of $6,400 and reimbursement income of $40,400, with DIP interest payments in cash monthly in arrears of $11,100, $12,800 and $14,100.

Conditions Precedent

• Entry of the interim order for the interim advances or the final order for the final advances, in form and substance satisfactory to the lender in its sole discretion. The order must include an express finding that the advances are protective advances under Sections 4.11, 7.6, and 7.8 of the leasehold mortgage that preserve the lender's rights as against the fee mortgagee; the entered final order contains that finding.
• Agreement on substantially final definitive documentation and an approved budget satisfactory to the lender in its sole discretion, provided that the lender will fund the interim advance on entry of the interim order and execution of the term sheet
• No default or event of default having occurred and continuing, together with:
  • Compliance with any milestones and with the approved budget
  • Prior written notice of borrowing
  • Accuracy of representations and warranties
  • Payment of all out-of-pocket costs, fees, and expenses owed to the lender
  The motion states the budget condition as compliance within 115% on a cumulative basis, while the final order tests disbursements for any one-week period at 115% of budget on an aggregate basis.
• Except as provided in the Carve-Out, the lender has no obligation to make any advance unless all conditions precedent are satisfied in full or waived.
• The term sheet is not binding until executed and becomes null and void, absent the lender's written consent, if the motion seeking the interim order was not filed by Sept. 15, 2026 or the interim order is not entered by Sept. 17, 2026. The motion was filed Sept. 17, 2026, the term sheet attached to the orders is dated Sept. 24, 2026, and the interim order was entered Sept. 25, 2026 [Doc 1231].

Covenants and Sale Milestones

• Retention of a co-broker acceptable to the lender to market the mortgaged property within 21 days of the lender's designation of that co-broker
• Seeking court approval of a sale of substantially all of the borrowers' property, including the leasehold interest, in form and substance reasonably acceptable to the lender, by Nov. 30, 2026
• Closing of that sale by Dec. 31, 2026, extended to Jan. 31, 2027 if a binding, duly executed purchase agreement has been entered, or a later date the lender agrees to in its sole discretion
• Upon the debtors' retention of a broker acceptable to the lender, the debtors, their professionals, and the broker must update the lender on the sale process at least weekly and deliver copies of indications of interest, letters of intent, and bids within one day of receipt. The final order cross-references paragraph 14(w) for the broker requirement, though the co-broker default appears at paragraph 14(u).
• The lender and its advisors have reasonable access to the borrowers' premises and properties on reasonable prior notice.
• The loan documents also carry the usual affirmative and negative covenants, including limits on indebtedness, liens, investments, acquisitions, restricted payments, and asset dispositions, and reporting on the budget and permitted variances.

Events of Default and Remedies

• Events of default include:
  • Failure to make any payment on the protective advances, including interest, or any adequate protection payment on the prepetition obligations, when due
  • Failure to obtain a final order by Oct. 2, 2026, under the term sheet
  • Breach of representations and warranties, or failure to comply with the affirmative or negative covenants, the term sheet, the approved budget including permitted variances, or the interim or final order in any respect
  • Failure to meet the co-broker retention, sale approval, or sale closing milestones
  • Dismissal of the cases, conversion to Chapter 7, or suspension under section 305
  • Appointment of a trustee or receiver, or of a responsible officer or examiner with enlarged powers
  • Any superpriority claim or lien arising pari passu with or senior to the lender's claims, charges, or liens
  • Any payment of principal or interest on prepetition indebtedness or payables other than to the lender or as authorized by orders satisfactory to it in its sole discretion
  • Stay relief permitting foreclosure on material assets or other actions with a material adverse effect on the borrowers or their estates
  • Reversal, amendment, supplementation, stay, vacatur, or modification of the final order without the lender's prior written consent, or an application for such an order
  • Any DIP loan document ceasing to be valid or effective or being contested by the debtors, or the DIP liens ceasing to be valid, perfected, and enforceable
  • Filing a Chapter 11 plan that does not propose to repay the DIP obligations in full in cash on the effective date, absent the lender's written consent
  • The filing of a challenge by the debtors or by any party the debtors support
  • An assertion in any pleading that the guaranties in the existing loan documents are not valid and binding
  • Entry of an order avoiding or requiring repayment of any payments made to the lender on account of the DIP obligations
  • Any party in interest challenging, objecting to, or contesting the characterization of the advances as protective advances under the existing loan documents or the lender's authority to make them
• On an event of default the lender may deliver a termination declaration that:
  • Accelerates all DIP obligations
  • Terminates or restricts the remaining commitment
  • Ends the facility as to any future lender obligation
  • Terminates or restricts the use of cash collateral
  The stay is modified so that 10 business days after that date, on written notice to the debtors, committee, and U.S. Trustee, the lender may exercise all rights and remedies against the DIP collateral, subject to the Carve-Out.
• During the remedies notice period the debtors may use cash collateral only to fund the Carve-Out and pay shared services and other expenses critical to preserving the estates under the approved budget, and the debtors and committee may seek an emergency hearing. Absent a hearing scheduled or being scheduled on the alleged default, the stay terminates automatically at the end of the period and the debtors waive the right to seek relief impairing the lender's remedies.
• For a challenge to the protective-advance characterization, the lender's sole remedy is to terminate the remaining commitment without affecting the DIP liens or obligations, though it may seek further relief from the court.
• The lender must give written notice of an event of default to the debtors, the committee and the U.S. Trustee, but that notice is informational only and is not a prerequisite to the default's occurrence.

Indemnification

• Under the final order, the borrowers indemnify the lender in both capacities and its affiliates, successors, officers, directors, employees, agents, attorneys, advisors, controlling persons, and members against all losses, costs, expenses, and liabilities arising out of the financing and any actual or proposed use of proceeds.
• The indemnity excludes amounts arising from a successful challenge or from an indemnified party's gross negligence or willful misconduct as determined by final, non-appealable judgment.
• The indemnity carries priority and lien status equal to the DIP superpriority claims, and no party is liable for special, indirect, consequential, or punitive damages.
• The lender is not deemed to control the debtors' operations or to act as a responsible person, owner or operator under CERCLA or similar statutes by reason of making loans or permitting the use of cash collateral.

Key Dates

• Petition date: June 4, 2026; joint administration orders entered June 12, 2026 and Sept. 25, 2026, as applicable
• The committee was appointed Aug. 21, 2026, though the term sheet dates the appointment Aug. 20, 2026. The term sheet refers to the jointly administered cases as Case No. 26-16515 (CMG), while the orders are captioned in Case No. 26-16439 (CMG).
• Motion filed Sept. 17, 2026 [D.I. 1144]. The orders recite an interim hearing held Sept. 16, 2026, the day before the motion was filed. Interim order entered Sept. 25, 2026 [Doc 1231].
• Objection deadline for the final hearing: Sept. 24, 2026 at 4:00 p.m. prevailing Eastern time, a date preceding the interim order's entry
• Final hearing held Oct. 1, 2026; final order entered Oct. 2, 2026 [Doc 1317], the date by which the term sheet required a final order. The final order is effective immediately upon entry and, except as the context otherwise requires, as of the petition date.
• Challenge period expires Nov. 21, 2026 under the final order (Nov. 13, 2026 under the term sheet); sale approval motion by Nov. 30, 2026; sale closing by Dec. 31, 2026, or Jan. 31, 2027 with a signed purchase agreement

Governing Law and Jurisdiction

• The bankruptcy court has jurisdiction over the parties' rights under the term sheet and retains exclusive jurisdiction over implementation, interpretation, and enforcement of the final order. If the bankruptcy court does not exercise jurisdiction, the parties submit to the federal and state courts of New Jersey, waive trial by jury, and agree that New Jersey law governs to the extent state law applies.

$13.0M Seven Mortgaged Properties / First Financial Bank DIP Terms

Borrower(s) / Guarantor(s)

• Fourteen debtor borrowers, paired as a real estate entity and a leasing entity for each of seven properties, jointly and severally liable for all DIP obligations:
  • 5707 MacCorkle Avenue Real Estate LLC and 5707 MacCorkle Avenue Leasing LLC
  • 771 Corporate Drive Real Estate LLC and 771 Corporate Drive Leasing LLC
  • 3413 Tittabawassee Road Real Estate LLC and 3413 Tittabawassee Road Leasing LLC
  • 4328 Bay Road Real Estate LLC and 4328 Bay Road Leasing LLC
  • South Loop West Real Estate LLC and South Loop West Leasing LLC
  • 400 Greens Road Real Estate LLC and 400 Greens Road Leasing LLC
  • 2974 Coppercreek Road Real Estate LLC and 2974 Coppercreek Road Leasing LLC
• Each of the seven prepetition loans is guaranteed by David A. Shabsels and Michael A. Shabsels under continuing guaranty agreements, and cross-guaranteed by the borrower pairs under the other six loans, with each cross-guaranty added as the corresponding loan closed between March 2021 and September 2023.
• The motion is captioned in both the jointly administered lead case, DAMIS Holdings LLC, Case No. 26-16439 (CMG), and the separate case of 2974 Coppercreek Road Real Estate LLC, Case No. 26-20450 (CMG), for which joint administration is requested. The interim and final orders are captioned in the lead case, and the final order recites joint administration orders entered June 12, 2026 and Sept. 25, 2026, as applicable.

Agent / Lender(s)

• First Financial Bank, which serves as both the prepetition secured lender under the seven loans and the DIP lender. Vorys, Sater, Seymour and Pease LLP and Blank Rome LLP act as its counsel in both capacities.

DIP Commitments

• A secured superpriority debtor-in-possession non-revolving term loan facility in an aggregate principal amount of up to $13,044,802.86, consisting of:
  • $6,922,600.00 in new money DIP loans, comprising up to $3,816,900.00 in interim advances available upon entry of the interim order and the balance upon entry of the final order
  • $6,122,202.86 in roll-up DIP loans, calculated as twice the amount of cash funded for the shared services agreements identified in the approved budget
• Upon entry of the final order the borrowers are authorized to borrow up to the full amount of the new money DIP loans without further action by any party.
• The motion sought an aggregate facility of up to $10,943,100.00, comprising $6,899,300.00 in new money DIP loans, of which $3,655,700.00 on an interim basis, and $4,043,800.00 in roll-up DIP loans; the interim and final orders and the term sheet attached to them carry the larger amounts.
• The final order describes the final new money tranche as "no less than" $3,105,700.00, while the term sheet describes it as the remaining amount of the total commitment, with the $13,044,802.86 aggregate ceiling bounding the tranches together.
• Borrowing is further capped by property-level draw caps, with a stated portion of each cap available before entry of the final order:
  • MacCorkle $774,100.00 (of which $288,100.00 pre-final)
  • Corporate Drive $655,100.00 ($34,300.00)
  • Tittabawassee $1,586,900.00 ($1,131,400.00)
  • Bay Road $1,118,100.00 ($857,000.00)
  • South Loop $1,042,300.00 ($604,700.00)
  • Greens Road $1,003,100.00 ($454,000.00)
  • Coppercreek Road $743,000.00 ($447,400.00)
  The seven caps total $6,922,600.00 and the seven pre-final amounts total $3,816,900.00, matching the new money commitment and the interim availability.
• Effective upon entry of the final order and the funding of the new money DIP loans, up to $6,122,202.86 of prepetition obligations is deemed converted into roll-up DIP loans on a cashless 2:1 basis ($2.00 of prepetition obligations for each $1.00 of shared services funding), without novation, repayment or release.
• The final order's findings describe the roll-up as consideration for the DIP lender's agreement to fund, while the decretal paragraph describes it as consideration for the agreement of the prepetition lender to fund. The roll-up is expressly subject to third-party challenge, and the final order states that, because of that reservation, it will not prejudice the rights of any other party in interest.
• The shared services agreement lines across the seven budget exhibits attached to the interim order total approximately $2.02 million through Jan. 1, 2027. Twice that figure is approximately $4.04 million, below the $6,122,202.86 roll-up stated in the orders and term sheet.
• Advances made and repaid may not be reborrowed.
• Borrowing requests may be submitted no more frequently than monthly and only for projected permitted uses for the subsequent monthly period under the approved budget, and advances are triggered only when the applicable borrower's operating account cash balance falls below a $10,000.00 minimum cash balance.
• Amendments, waivers, consents and other modifications that are not material require no further court approval, and must be provided to the U.S. Trustee and committee counsel substantially concurrently with being implemented. All amendments to the approved DIP budget must be reasonably acceptable to the lender, and the shared services line item in any amended budget may not be reduced from the prior approved budget without the committee's consent.
• Where the documents conflict, the final order controls over:
  • The term sheet and the motion [D.I. 1146]
  • The sixth interim cash collateral order [D.I. 1203] and its predecessors [D.I. 263, 427, 582, 727, 974]
  • The interim order [Doc 1229]
  As between the term sheet and the motion, the term sheet controls.
• The chief restructuring officer, Perry Mandarino, analyzed projected cash flows, capital expenditure requirements, tenant improvement obligations and other operating costs across all seven property groups [D.I. 1177]. He concluded that the borrowers require up to $10,943,100.00 to fund preservation and operation of the properties through the anticipated sale process.
• The term sheet attached to the final order is captioned as a final debtor-in-possession financing term sheet subject to agreed interim and final orders, but continues to state that it is for discussion purposes only and non-binding. The final order nonetheless binds the debtors and the lender to its terms upon entry, pending execution and delivery.

Prepetition Debt

• Seven separate loans made to special purpose entities holding leasehold interests in income-producing commercial real estate. Each loan is evidenced by a promissory note and governed by a loan agreement, recorded leasehold mortgage or deed of trust, assignment of rents and leases and related documents identified on Schedule A to the term sheet.
• As of the petition date the borrowers are jointly and severally indebted for principal, accrued interest, fees, costs and expenses, aggregating $78,259,230.00:
  • MacCorkle Loan: $8,443,545.00
  • Corporate Drive Loan: $6,949,994.00
  • Tittabawassee Loan: $15,035,523.00
  • Bay Road Loan: $9,449,836.00
  • South Loop Loan: $11,271,548.00
  • Greens Road Loan: $14,077,147.00
  • Coppercreek Loan: $13,031,637.00
  The final order continues to head that section "Outstanding Obligations (Amounts Reserved)" and to describe the amounts as "to be provided," and the term sheet's conditions precedent make the stipulated amounts subject to the lender's review and confirmation.
• The mortgaged properties are:
  • 5707 MacCorkle Avenue, Charleston, West Virginia
  • 771 Corporate Drive, Lexington, Kentucky
  • 3413 Tittabawassee Road (with 3175 Westbay Drive and 3343 Tittabawassee Road), Saginaw, Michigan
  • 4328-4460 Bay Road, Saginaw, Michigan
  • 2616-2626 S. Loop W., Houston, Texas
  • 400 Greens Road, Houston, Texas
  • The Coppercreek property
  The motion's introduction locates the Coppercreek property at 2974 Coppercreek Road, Fort Worth, Texas. The debtors' stipulations, the loan documents schedule and the recorded deed of trust place it at 2974 Coppercreek Road, St. Louis, Missouri, together with 9406 Canfield Court and 2907 Caddiefield Road, Ferguson, Missouri.
• The lender holds properly perfected first-priority security interests in each property group's leasehold interests, improvements, appurtenances, fixtures, personal property and proceeds, together with an assignment of and security interest in the rents, leases, occupancy agreements, issues, profits and other income.
• Because the real property collateral consists of leasehold interests, the collateral structure for each loan includes ground lease recognition, subordination, non-disturbance, estoppel and attornment agreements. Those agreements give the lender as leasehold mortgagee:
  • Notice of tenant defaults
  • Cure periods for monetary and non-monetary defaults before termination becomes effective
  • Subject to their terms, the option to require a replacement ground lease on substantially the same terms and remaining term if the ground lease is terminated or rejected in bankruptcy

Cash Collateral

• The final order authorizes the borrowers to continue using all of the lender's cash collateral, defined to include the rents and other income generated from the collateral and proceeds thereof. Use is limited to the purposes set forth in the final order and must be consistent with the approved DIP budgets, including to make the adequate protection payments, through and including termination of the term sheet.
• The debtors acknowledge that the lender's prepetition security interest in rents and other income continues postpetition under section 552(b)(2), and in proceeds, products, offspring and profits under section 552(b)(1), to the extent provided by applicable law.
• The court previously granted the cash collateral motion filed June 24, 2026 [D.I. 152] on an interim basis as to the lender in a series of six interim orders [D.I. 263, 427, 582, 727, 974, 1203].

Interest Rate

• 7.0% per annum (700 basis points), fixed, on all advances under the DIP loan
• Default Rate Increase: an additional 5.0% (500 basis points) after maturity or the occurrence of an event of default
• Accrued interest is due and payable monthly in arrears on the first day of each month following the first advance, calculated on actual days elapsed over a 360-day year. All remaining accrued and unpaid interest is due in cash on the maturity date, together with principal, late fees, the lender's reasonable and documented legal fees and disbursements, and any other charges.
• The seven budget exhibits carry both a weekly DIP interest accrual at 7% that is added to the ending DIP balance and a separate line for DIP interest payments in cash monthly in arrears.
• Adequate protection interest on the prepetition obligations accrues at the contractual non-default rate.

Fees

• Finance fee: a non-refundable 1% of the aggregate of all advances made under the DIP loan. No commitment fees or unused line fees.
• Lender Professional Fees: non-refundable payment of all reasonable and documented fees and expenses arising from negotiating, documenting, approving, administering, monitoring or enforcing rights under the term sheet or related to the cases. These include the fees of Vorys, Sater, Seymour and Pease LLP, Blank Rome LLP and any other lender-retained professionals, and are not subject to court approval or interim or final fee applications.
• The final order sets a 10-business-day review period after receipt of an invoice by counsel for the borrowers, the committee and the U.S. Trustee. A timely written objection limits payment to the unobjected amounts pending agreement or a court order. The motion's concise statement and the term sheet describe the period as ten days, and the term sheet requires an objecting party to file its objection with the court within that period. The review period does not apply to fees paid on the effective date of a plan or at the closing of a sale that pays the prepetition and DIP obligations in full.
• Separately, the borrowers are authorized and directed to pay on the funding date of the interim advances all reasonable and documented fees, costs and expenses of the lender's professionals incurred on or after the petition date, outside the review procedure.
• Invoices need not follow any particular format or the U.S. Trustee guidelines, but must carry sufficient detail to assess reasonableness. That detail includes a general description of matters, timekeepers, hourly rates, hours billed and, for law firms, year of law school graduation, with redactions for privilege preserved.

Maturity

• All DIP obligations are immediately due and payable upon the earliest to occur of:
  • The effective date of a confirmed Chapter 11 plan
  • Closing on the final sale or other disposition of all or a substantial portion of the borrowers' assets securing the prepetition obligations and the DIP loan
  • Conversion of any of the cases to Chapter 7
  • Dismissal of any of the cases
  • Appointment of a Chapter 11 trustee
  • Acceleration of the DIP loan and termination of further advances following an event of default
  • Six months from the date of issuance, subject to an automatic 60-day extension if a sale of the borrowers' real property has been approved but remains pending closing
• The parties may agree in writing to extend the maturity date.
• On the closing of a sale of all or substantially all of any borrower's assets, that borrower may request no further draws and the lender has no further obligation to lend to it. Net proceeds are distributed in this order, with any remainder held by the estate pending further order of the court:
  • First, outstanding principal under that borrower's prepetition promissory note
  • Second, outstanding interest under that note
  • Third, outstanding principal under the DIP loan
  • Fourth, outstanding interest under the DIP loan
• Net proceeds are gross sale price less:
  • Court-allowed broker commissions
  • Reductions or closing payments for real estate taxes on the assets sold
  • All carve-out amounts included but unpaid at closing in the applicable approved budget
  • Other costs customarily allocated to seller under the purchase agreement and reflected on the settlement statement
• Any unused amounts allocated in the approved budget for the lender's legal fees are redistributed equally among the borrowers whose assets remain in their estates, equally increasing each such borrower's draw cap and legal fee allocation.
• The DIP obligations are not discharged by confirmation of a plan of reorganization or liquidation; they must be paid in full on the plan effective date, and the borrowers have waived discharge as to those amounts under section 1141(d)(4).
• The DIP liens, superpriority claims and remedies continue until either the DIP obligations are paid in full in cash and the commitments terminate, or an "Acceptable Plan" is consummated. The final order defines an Acceptable Plan as one that:
  • Is in form and substance acceptable to both the DIP lender and the prepetition lender
  • Pays all DIP obligations and all prepetition obligations in full in cash on the effective date
  • Does not impair either party's claims or liens without prior written consent
  The adequate protection liens and obligations run until the earlier of consummation of an Acceptable Plan and repayment in full in cash.

Carve Out

• Consists, as to each borrower, of the sum of:
  • All fees payable by that borrower to the Clerk of the Court and the U.S. Trustee under 28 U.S.C. § 1930(a) before expiration of the remedies notice period, plus interest at the statutory rate, which are not subject to any budget
  • An amount equal to the cumulative shared services payable by that borrower under the approved DIP budget before the earlier of the end of the budget period and expiration of the remedies notice period, prorated for any month in which that period expires. The amount may be funded from DIP loans, operating cash flow or proceeds of disposition of the prepetition or DIP collateral.
• A termination declaration is deemed delivered on the maturity date, and the carve-out's limits are not extended by the court's inability to provide an emergency hearing within the remedies notice period. The term sheet describes the shared services component as amounts payable to DAMIS Holdings LLC and makes the prepetition liens, DIP liens, adequate protection liens and superpriority claims subordinate to the carve-out.
• The carve-out is reduced on a dollar-for-dollar basis weekly by amounts actually paid, reserved or set aside on its account, without duplication. Nothing in the carve-out provision increases the amount of DIP loans the lender is committed to fund, increases budgeted shared services, or requires funding after expiration of the remedies notice period.
• The carve-out carries no component for the fees of professionals retained by the debtors or the committee. The final order provides that neither the DIP lender nor the prepetition lender is responsible for paying or reimbursing any professional's fees or Clerk and U.S. Trustee fees. The carve-out is not a cap on those fees or on intercompany administrative claims payable from a source other than the prepetition or DIP collateral.
• Investigation Budget: the motion and the term sheet permit up to $35,000.00 of the carve-out to be used by the committee solely to investigate claims against the prepetition lender within the challenge period. The final order instead frames the same $35,000.00 as an aggregate cap on proceeds of the DIP facility, DIP collateral or prepetition collateral, including cash collateral, used for that purpose, and requires such use to comply with the approved DIP budget.

Use of Proceeds

• DIP proceeds may be used solely for maintenance and repairs and other costs of maintaining the mortgaged properties, providing adequate protection to the secured lender, operating expenses, funding the carve-out, and other related costs, in each case in accordance with the approved DIP budgets and the DIP orders.
• The final order's preamble also describes DIP proceeds and cash collateral as providing working capital and general corporate purposes of the borrowers, including payment of the carve-out and the adequate protection professional fees, solely in accordance with the approved DIP budget.
• No proceeds may satisfy any claim or obligation of a non-borrower debtor except indirectly through the borrowers' payment of shared services agreement amounts under the approved DIP budget.
• Neither DIP proceeds nor the lender's cash collateral may be used for the following, subject only to the $35,000.00 investigation budget:
  • Asserting claims or causes of action against the DIP lender or the prepetition lender or their agents
  • Challenging the DIP loan, the prepetition obligations or the related liens
  • Investigating, initiating, prosecuting, joining or financing any such litigation
  • Seeking relief impairing either lender's rights or recovery on the collateral

Credit Bid

• Subject to the lien priorities set forth in the final order and to section 363(k):
  • The DIP lender may credit bid all or any portion of the DIP obligations in any sale of the DIP collateral
  • The prepetition lender may credit bid up to the full amount of the prepetition obligations, including any adequate protection obligations, in any sale of the prepetition collateral
  Either bid must follow any bidding or sale procedures order and requires no further court order, whether the sale is effectuated under section 363(k), 1123 or 1129(b), by a Chapter 7 trustee under section 725, or otherwise.
• It is an event of default if any debtor files or supports a motion asserting that either lender lacks the right to credit bid under section 363(k).

Avoidance Actions

• Under the final order, the DIP superpriority claims are payable from proceeds or property recovered in connection with chapter 5 avoidance actions and section 724(a) claims, and the DIP liens on unencumbered property include avoidance-action proceeds. The adequate protection liens attach to the DIP collateral, including those proceeds.
• The final order's description of the DIP collateral reaches all claims and causes of action of the borrowers and their estates and the proceeds thereof, and contains no look-last limitation. The term sheet instead excludes chapter 5 avoidance actions themselves from the DIP liens, extends the liens to their proceeds upon entry of the final order, and requires the lender to look last to those proceeds.

Challenge Period and Budget

• The facility is conditioned on the debtors' stipulations, effective upon entry of the interim order, covering:
  • The amount, allowance and non-avoidability of the prepetition obligations as set forth in the prior cash collateral orders and Schedule A
  • The validity, binding effect, enforceability, non-avoidability and perfection of the prepetition liens and their seniority over all other liens on the prepetition collateral
  • The absence of any offsets, defenses, counterclaims or estate claims against the lender
  • A waiver, discharge and release of any right to challenge them
  One clause in the final order states that the prepetition obligations are legal, valid, binding and non-avoidable obligations "of the Prepetition Lender" rather than of the debtors.
• The stipulations bind the debtors and their estates irrevocably as of the petition date. They bind all other parties in interest unless a party with standing granted by court order files an adversary proceeding or contested matter within 60 days after entry of the interim order (the initial challenge period). The interim order was entered Sept. 25, 2026, placing the deadline at Nov. 24, 2026. If the cases convert to Chapter 7 or a Chapter 11 trustee is appointed before that date, the period extends to the later of the time remaining and 30 days after the appointment. A challenge may also be directed at the roll-up DIP loans.
• If the committee or another party files a motion for standing attaching a draft complaint during the initial challenge period, the period is tolled for that party, solely as to the challenges in the draft complaint, until three business days after entry of an order granting standing. If standing is denied, the challenge period is deemed to have expired. A separate standing order is a prerequisite to prosecution of a challenge, and nothing in the final order confers standing.
• Absent a timely challenge or standing motion, or if a challenge is overruled or standing denied, the prepetition obligations become allowed claims not subject to counterclaim, setoff, recoupment, reduction, subordination, recharacterization, defense or avoidance, and the prepetition liens are deemed legal, valid, binding and perfected as of the petition date.
• A timely challenge leaves the stipulations binding on all other parties except as expressly challenged in the adversary proceeding, contested matter or draft complaint before expiration of the initial challenge period. An appointed trustee is not bound by the debtors' stipulations for purposes of a challenge proceeding.
• Upon the closing of any sale of all or substantially all of a borrower's assets, the debtors are directed to pay the net sale proceeds to the DIP lender and the prepetition lender up to the amount of the prepetition obligations and the DIP obligations, in accordance with the term sheet and subject to the rights of a party in interest to timely assert a challenge.
• Each of the seven property groups operates under its own approved DIP budget, approved by and in form and substance reasonably acceptable to the lender. The budgets are attached as Exhibit 2 to the interim and final orders, though the motion elsewhere describes them as attached as Exhibits B-1 through B-7.
• The budgets attached to the interim order, dated Sept. 21, 2026, run as weekly cash flow forecasts through Jan. 1, 2027, and project aggregate draws equal to each property group's full draw cap. Their aggregate ending DIP balances are roughly $7.08 million against the $6,922,600.00 new money commitment, reflecting the capitalized finance fee and accrued interest; the term sheet states the estimated aggregate DIP balance across the seven properties as $7,082,957.30.
• The budget exhibits' beginning total debt balances for four of the seven property groups (MacCorkle, Bay Road, Greens Road and Coppercreek) differ from the stipulated petition-date obligations for the corresponding loans.

Securities and Priorities

• Because the same institution is both prepetition and DIP lender, the DIP liens are granted junior to the prepetition liens so that the prepetition liens retain their status as "Qualified Mortgages" under the applicable ground leases. The DIP liens do not constitute a Qualified Mortgage and do not negate, void or modify the lender's status as a Qualified Mortgagee or the status of any mortgage or deed of trust securing the prepetition obligations.
• Subject to the Carve-Out, the DIP obligations are allowed superpriority administrative expense claims under section 364(c)(1) against each borrower's estate. They have priority over all administrative expenses, adequate protection claims and diminution claims, including those under sections 105, 328, 330, 331, 503(b), 506(c), 507(a) other than 507(a)(1), 507(b), 726, 1113 and 1114, and administrative claims arising under the final cash management order, whose docket number the final order leaves blank.
• The DIP superpriority claims are treated as allowed section 503(b) expenses for purposes of section 1129(a)(9)(A) and are payable from all prepetition and postpetition property and avoidance-action proceeds, subject to the carve-out and the lender's senior prepetition liens. The term sheet instead cites section 364(d)(1) as the basis for the superpriority claim.
• No other superpriority claim may be granted unless junior to the DIP superpriority claims and the adequate protection claims and consented to by the lender.
• Effective as of entry of the final order, the lender is granted automatically perfected DIP liens, without any filing or recording, on all prepetition and postpetition property of the borrowers and proceeds. The collateral includes accounts, inventory, equipment, fixtures, commercial tort claims, deposit accounts, cash, investment property, intellectual property, insurance rights, intercompany claims, real property, leaseholds, rents and profits, and claims and causes of action. The liens carry the following priorities, in each case subject to the Carve-Out and to the prepetition lender's liens:
  • Section 364(c)(2): first-priority senior liens on all unencumbered property, including unencumbered cash, receivables, leasehold interests and avoidance-action proceeds
  • Section 364(c)(3): second-priority liens on all DIP collateral, which the final order states are senior to all existing liens other than the prepetition liens and permitted liens, with holders of the primed liens deemed to have consented; the motion and term sheet cite section 364(d) for the priming grant
  • Section 364(c)(3): liens junior only to permitted liens, limited to statutory tax liens not yet due or contested in good faith and ordinary-course mechanics', materialmen's, warehousemen's, carriers', repairmen's and landlord's liens. No lien securing borrowed money, funded debt, letter-of-credit obligations or other financing obligations, other than the prepetition lender's liens, qualifies, and each permitted lien remains subject to avoidance, recharacterization, subordination, surcharge, reduction, disallowance and challenge
• The DIP liens are senior to any lien avoided and preserved under section 551, are enforceable against any trustee and upon conversion or dismissal, may not be made subject to or pari passu with any later-granted lien other than the adequate protection liens, and are not subject to sections 510, 549 or 550. The term sheet adds that the DIP liens are senior to any other postpetition liens granted to the DIP lender.
• Lease and license anti-assignment provisions requiring counterparty consent or payment of fees to a governmental entity are deemed inconsistent with the Bankruptcy Code, subject to applicable law. They have no effect on the grant of the DIP liens and adequate protection liens, and any counterparty's right to object to assumption or assignment on other grounds is preserved. The lien-grant paragraph excepts nonresidential real property leases from that override, while the parallel perfection provision carries no such exception, excepts stamp taxes instead, and reaches leasehold interests expressly.
• The lender may, but need not, file financing statements, mortgages, control agreements or notices of lien, or record a certified copy of the final order; the date of perfection is in all events the date of the final order. The borrowers must use commercially reasonable efforts to cooperate, at their own cost. The term sheet contemplates the borrowers providing a mortgage or deed of trust for recording as a second-priority leasehold security interest securing the DIP loan.
• Insurance: until the DIP obligations are paid in full, the borrowers must maintain casualty and loss coverage on the prepetition and DIP collateral as required by the prepetition loan documents and name the DIP lender as loss payee or additional insured.

Adequate Protection

First Financial Bank

• Payment of ground rent to the applicable ground lessors, or alternatively to the applicable fee mortgagee, to the extent provided in the approved DIP budget. A payment to the fee mortgagee satisfies the ground rent obligations under the applicable recognition agreement and ground lease. Under the term sheet, the obligation includes prepetition delinquent rent.
• Payment of real estate taxes per the approved DIP budgets
• Continued payment of postpetition interest on the prepetition obligations at the contractual non-default rate, to the extent provided in the approved DIP budget. The final order does not find that the lender is entitled to postpetition interest under section 506(b), but provides that this does not limit the obligation to make the adequate protection payments or render them subject to avoidance, disgorgement or similar claims.
• Section 507(b) superpriority administrative expense claims for any postpetition diminution in value, subject and subordinate only to the Carve-Out and the DIP superpriority claims. These claims are senior to all other claims against the borrowers' estates, including administrative expense claims under the final cash management order. The term sheet separately provides that the lender may not assert a section 507(b) claim on account of use of cash collateral consistent with the approved budget.
• Replacement adequate protection liens in the DIP collateral, effective and automatically perfected as of entry of the final order, in the amount of any diminution in value. The final order describes those liens as senior to all other liens on and claims against the DIP collateral, subject to the challenge provisions and subordinate only to the Carve-Out. They may not be made subject to or pari passu with any lien avoided and preserved for the estates or any lien, security interest or administrative claim under the Bankruptcy Code.
• Payment of the reasonable and documented out-of-pocket fees, costs and expenses of the prepetition lender, including those of Vorys, Sater, Seymour and Pease LLP and Blank Rome LLP, incurred after the petition date, without separate court approval or fee applications
• Maintenance of cash management arrangements consistent with the final cash management order and compliance with all reporting requirements in the prepetition loan documents; failure to comply with the term sheet covenants is an event of default
• The lender is deemed to have requested stay relief and adequate protection for any diminution in value from and after the petition date. The final order preserves its section 507(b) rights and its right to seek additional or alternative adequate protection, without any finding that the protection granted is in fact adequate.

Waivers

• Under the final order, in light of the prepetition lender's agreement to subordinate its superpriority claims to the DIP obligations and the Carve-Out and to permit use of its cash collateral, and, under the term sheet, provided the lender funds in accordance with the term sheet and the orders:
  • Section 506(c): no administration expenses may be charged against or recovered from the DIP collateral or the prepetition collateral, except to the extent of the Carve-Out, or from either lender, without prior written consent, and no consent may be implied from any other action, inaction or acquiescence
  • Section 552(b): the "equities of the case" exception does not apply to the proceeds, products, offspring or profits of the collateral
  • Marshaling and similar doctrines do not apply to the DIP collateral or the prepetition collateral
• Effective upon entry of the final order, and subject to third-party challenge rights as to the prepetition lender, the debtors and their estates release the DIP lender and the prepetition lender and their affiliates, advisors and representatives from all claims relating to:
  • The DIP and prepetition obligations, liens, claims and loan documents
  • The adequate protection obligations, liens and claims
  • Lender-liability and equitable subordination theories
  • Any attack on the validity, priority, extent, enforceability, perfection or avoidability of the lenders' liens and claims
  The release in favor of the DIP lender as to the interim advances, the related DIP liens and the other DIP obligations approved by the final order is not subject to the challenge period or to a challenge. Excluded are claims a court determines by final, non-appealable order primarily result from bad faith, fraud, gross negligence or willful misconduct.

Permitted Variance

• The final order provides that actual disbursements for each line item of each approved DIP budget may not vary by more than 15% of the projected amount without the written consent of both the prepetition lender and the DIP lender, which may be given by email. Disbursements are measured cumulatively from the petition date through the end of each weekly measurement period, including on a borrower-by-borrower basis. The term sheet tests cumulative disbursements at 15% of the applicable approved budget measured weekly, without the line-item qualifier.
• A weekly variance report setting forth actual results for each line item as of two Sundays prior to the current week is due to the prepetition lender, the DIP lender and the committee by 5:00 p.m. prevailing Eastern time each Friday.
• The borrowers must also provide the lender and its advisors with all reporting and diligence information requested, and reasonable access during normal business hours to books, records, personnel and management.

Conditions Precedent

• Entry of the interim order for the interim availability, or the final order for the remaining amounts, in form and substance satisfactory to the lender and its counsel. The orders must include the debtors' stipulations, effective upon entry of the interim order, to the amount, allowance and non-avoidability of the prepetition obligations as set forth in the prior cash collateral orders and Schedule A, subject to the lender's review and confirmation and to the 60-day challenge period.
• Compliance with the approved DIP budget within the 15% permitted variance on a cumulative basis, no event of default having occurred and continuing, submission of a borrowing request on the prescribed form, and all other conditions in the term sheet
• Except for the carve-out, the lender has no obligation to make any DIP loan unless all conditions precedent are satisfied in full or waived
• The term sheet is not binding until executed and becomes null and void, absent the lender's written consent, if the borrowers did not file a motion seeking entry of the interim order, or seek an interim order by consent, by Sept. 15, 2026, or if the interim order is not entered by Sept. 17, 2026. The motion was filed Sept. 17, 2026 [D.I. 1146] and the interim order was entered Sept. 25, 2026 [Doc 1229].

Covenants and Sale Milestones

• Seeking bankruptcy court approval of a sale of substantially all of the borrowers' real property, including their leasehold interests, by Nov. 30, 2026
• Closing of that sale by Dec. 31, 2026, extended to Jan. 31, 2027 if a binding, duly executed purchase agreement has been entered, or a later date the lender agrees to in its sole discretion
• Obtaining a final order by Oct. 2, 2026
• Maintaining adequate insurance on the property subject to the DIP liens, making monthly interest payments on the DIP loan, making monthly payments on the prepetition obligations in accordance with the applicable approved budget, and paying net proceeds in accordance with the term sheet and the orders
• Bid procedures, stalking horse selections and stalking horse agreements, any amendment to them, and the sale itself must be acceptable to the lender. Any sale of all or substantially all of the borrowers' property must provide for indefeasible payment in full in cash of both the prepetition obligations and the DIP obligations.

Events of Default and Remedies

• Events of default include:
  • Failure to make any payment on the DIP loans, including interest, or any adequate protection payment on the prepetition obligations, when due
  • Failure to obtain a final order by Oct. 2, 2026
  • Breach of representations and warranties, failure to comply with the affirmative or negative covenants, the term sheet, the approved DIP budget including permitted variances, or the final order in any respect
  • Failure to meet the sale approval or sale closing milestones
  • Dismissal of the cases, conversion to Chapter 7, or suspension under section 305
  • Appointment of a trustee or receiver, of a responsible officer or examiner with enlarged powers, or of a fiduciary with management authority over senior management, or substantive consolidation of a borrower's estate with another estate
  • Any superpriority claim or lien arising pari passu with or senior to the lender's claims, charges or liens
  • Stay relief permitting foreclosure on material assets or other actions with a material adverse effect on the borrowers or their estates
  • Entry of any non-consented order revoking, reversing, staying, vacating, rescinding, modifying, supplementing or amending the cash management order or other first day orders, as relating to a borrower or DAMIS Holdings LLC, in a manner materially adverse to either lender
  • Reversal, amendment, supplementation, stay, vacatur or modification of the final order without the lender's prior written consent, or an application for such an order
  • An application for any of the specified adverse orders made by a party other than a borrower that the borrowers are not diligently contesting in good faith
  • Any DIP loan document or loan document ceasing to be valid, binding or effective or being contested by a debtor, any debtor seeking or supporting disallowance of either lender's claim or a challenge to its liens, or the DIP liens ceasing to be valid, perfected and enforceable with the priority set forth in the order
  • Filing a Chapter 11 plan that does not propose to repay the DIP obligations and, subject to the challenge rights, the prepetition obligations in full in cash on the effective date, absent the written consent of the DIP lender or the prepetition lender, as applicable
  • The filing of a challenge by the debtors, or by any party where the challenge is supported by the debtors
  • Any payment of principal or interest on prepetition indebtedness or payables other than to the lenders or as authorized by orders satisfactory to the DIP lender in its sole discretion
  • Seeking postpetition financing secured by the prepetition collateral from another party, or to use the lender's cash collateral, without its written consent
  • Seizure, garnishment or governmental taking of any portion of the collateral, or the borrowers' title becoming the subject of litigation or garnishment
  • Any sale, transfer, lease, encumbrance or other disposition of collateral without a court order and the lender's written consent
  • Any of the following sale-process actions:
    • Filing bid procedures, selecting stalking horse bidders or approving stalking horse agreements, or seeking approval of a sale, in each case not acceptable to the lender
    • Amending any sale or stalking horse agreement without the lender's prior written consent
    • A sale of all or substantially all of the borrowers' property under an order that does not provide for indefeasible payment in full in cash of the prepetition and DIP obligations
  • Entry of an order avoiding or requiring repayment of any payments made on account of the DIP obligations
  • Any event of default under the term sheet or related documents
• The final order deadline, the sale milestones, the insurance, net proceeds and prepetition payment defaults, and the financing and cash collateral defaults appear among the term sheet's events of default rather than in the final order's enumerated list, which incorporates them through its catch-all for any event of default under the term sheet.
• On an event of default the lender may deliver a termination declaration, without application to the court, that:
  • Accelerates all DIP obligations
  • Terminates, reduces or restricts any remaining commitment
  • Ends the facility as to any future lender obligation, without affecting the DIP liens or obligations
  • Terminates, reduces or restricts the use of cash collateral
  The lender may also charge the default rate and exercise setoff rights against collateral in its possession.
• The stay is modified so that five business days after delivery of the termination declaration, with written notice to the debtors, the committee and the U.S. Trustee, the lender may exercise its rights and remedies against the DIP collateral and the prepetition collateral, subject to the carve-out. That right holds unless the court determines before expiration of the period that an event of default has not occurred or is not continuing. The term sheet likewise provides five business days' prior notice, with remedies exercisable if the default is continuing on the fifth business day.
• During the remedies notice period the borrowers may use cash collateral solely to fund the carve-out and pay shared services and other expenses critical to administration of the estates under the approved DIP budget. The debtors and the committee may seek an emergency hearing within the remedies notice period or on the earliest available court date thereafter.
• Absent a contrary determination, the stay terminates automatically at the end of the remedies notice period, and the debtors waive the right to seek relief impairing either lender's remedies. The term sheet adds that the lender may not exercise remedies if the court has scheduled or is in the process of scheduling a hearing on the alleged default.
• Remedies available on foreclosure include taking possession and control of the leasehold estates, exercising rights as assignee of leases and rents directly or through a receiver, and collecting rental income and profits.
• The lender must give written notice of an event of default to the debtors, the committee and the U.S. Trustee, which may be by email, but that notice is informational only and is not a prerequisite to the default's occurrence.

Indemnification

• Under the final order, the borrowers indemnify the DIP lender and the prepetition lender and their affiliates, successors, assigns, officers, directors, managers, employees, agents, attorneys, advisors, controlling persons and members against all losses, costs, expenses and liabilities arising out of the financing and any actual or proposed use of proceeds.
• The indemnity excludes amounts arising from a successful challenge or, as determined by final, non-appealable judgment, from an indemnified party's gross negligence or willful misconduct. A following sentence limits liability to conduct found to have resulted solely from gross negligence, fraud, willful misconduct or breach of obligations under the DIP facility.
• The indemnity carries priority and lien status equal to the DIP superpriority claims, and no party is liable for special, indirect, consequential or punitive damages.
• Neither lender is deemed to control the debtors' operations or to act as a responsible person, owner or operator under CERCLA or similar statutes by reason of making loans or permitting the use of cash collateral, and neither is liable for claims arising from the debtors' prepetition or postpetition activities.

Key Dates

• Petition date: June 4, 2026, or Sept. 14, 2026 as applicable; joint administration approved June 12, 2026 [D.I. 35] and Sept. 25, 2026, as applicable
• Committee appointed on or about Aug. 21, 2026 [D.I. 518]
• Motion filed Sept. 17, 2026 [D.I. 1146]; DIP declaration [D.I. 1177]; interim hearing held Sept. 22, 2026; interim order entered Sept. 25, 2026 [Doc 1229], eight days after the term sheet's Sept. 17, 2026 entry deadline
• Objection deadline for the final hearing: Sept. 24, 2026 at 4:00 p.m. prevailing Eastern time, a date preceding the interim order's entry
• Final hearing held Oct. 1, 2026; final order entered Oct. 2, 2026 [Doc 1318], the date by which the term sheet required a final order. The final order's caption approves the term sheet "on a Final Basis," while the running header on its subsequent pages reads "on an Interim Basis." The order is effective immediately upon entry, with any stay under Bankruptcy Rule 6004 waived, and, unless the context otherwise requires, as of the petition date.
• Initial challenge period expires Nov. 24, 2026 (60 days after entry of the interim order); sale approval motion by Nov. 30, 2026; sale closing by Dec. 31, 2026, or Jan. 31, 2027 with a signed purchase agreement; budgets run through Jan. 1, 2027

Governing Law and Jurisdiction

• The bankruptcy court has jurisdiction over the parties' rights under the term sheet and retains exclusive jurisdiction over implementation, interpretation and enforcement of the final order, including after dismissal of the cases. If the bankruptcy court does not have or does not exercise jurisdiction, the parties submit to the federal and state courts of New Jersey, waive trial by jury, and agree that New Jersey law governs to the extent state law applies.

$0.5M 2547 Brindle Drive / S&T Bank DIP Terms

Borrower(s) / Guarantor(s)

• 2547 Brindle Drive Real Estate LLC and 2547 Brindle Drive Leasing LLC, as borrowers, jointly and severally liable for all obligations under the DIP loan
• Repayment of the prepetition loan is guaranteed by David Shabsels and Michael Shabsels under individual guaranty and suretyship agreements in favor of the lender. Neither the final order nor the term sheet identifies any guarantor of the DIP loan.

Agent / Lender(s)

• S&T Bank, which serves as both the prepetition lender to the borrowers and the DIP lender.

DIP Commitments

• The final order approves on a final basis borrowing under the DIP facility consisting of:
  • New-money term loans of up to $500,000, with the option to increase by up to $490,000 through over-advances with the lender's approval
  • A roll-up of $692,400 of the prepetition secured obligations into postpetition loans under the DIP facility
• The term sheet describes the facility as a secured superpriority debtor-in-possession non-revolving line of credit in an initial principal amount of up to $500,000, funded as follows:
  • $419,900 available upon entry of the consent order approving the term sheet on an interim basis
  • Upon entry of the final order, the remaining initial amount of the DIP loan, and, upon the borrowers' request, up to $490,000 in over-advances, subject to the lender's approval in all respects
• The consent order's recitals describe the lender's commitment as a $419,900 advance, while the term sheet frames that amount as the interim availability under a facility of up to $500,000 before over-advances.
• Advances made and repaid may not be reborrowed without the lender's consent, which it may give or withhold in its sole discretion.
• Borrowing requests may be submitted on a prescribed form no more frequently than bi-monthly and only for projected permitted uses for the subsequent two-week period under the approved budget.
• The term sheet is captioned for discussion purposes only, non-binding and subject to Federal Rule of Evidence 408, and preliminary and subject to further review and approvals. The final order nonetheless approves it on a final basis, as it may be modified by Exhibit 1 to the final order, and makes the obligations under it valid and binding obligations of the borrowers.
• Where the documents conflict, the final order controls over the interim cash collateral orders [D.I. 625, 843, 979], the interim DIP order, the term sheet and the debtors' DIP approval request [D.I. 1109]; as between the DIP approval request and the term sheet, the term sheet controls.
• The borrowers may agree with the lender to consensual modifications of the approved budget or the term sheet, subject to the following conditions:
  • Any proposed modification must be provided, which may be by email, to the U.S. Trustee and committee counsel at least three business days before its anticipated effectiveness.
  • A material DIP amendment, meaning one that shortens maturity or increases the aggregate commitments or the interest rate, must be filed with the court and is deemed approved if no objection is made within three business days of filing; if an objection is made, the amendment is subject to a hearing and court approval.
  • The approved budget may not be amended to reduce the shared services line item from the prior approved budget without the committee's consent.
• Any objections not withdrawn or resolved are overruled on the merits, and the final order is effective immediately on entry, with any stay under Bankruptcy Rule 6004(h) waived.

Prepetition Debt

• The borrowers stipulate that, as of the petition date, they were indebted to the lender under a Mortgage Loan Agreement dated Dec. 16, 2024 and effective Dec. 20, 2024, under which the lender made available a commercial term loan in the original principal amount of $14,475,000, evidenced by a mortgage note.
• Neither the final order nor the term sheet states the outstanding amount. The DIP budget attached to the consent order shows a beginning total debt balance of approximately $14,097,000 as of Sept. 4, 2026, rising to approximately $14,989,600 by Jan. 1, 2027.
• The prepetition obligations are secured by valid, enforceable, first-priority, perfected liens under:
  • An Open-End Leasehold Mortgage and Security Agreement dated Dec. 16, 2024 and effective Dec. 20, 2024, on the borrowers' leasehold interest in premises in Susquehanna Township, Dauphin County, Pennsylvania, held under a ground lease dated March 27, 2019, together with improvements, fixtures and related appurtenant rights
  • A security agreement of the same date on substantially all of the borrowers' personal property, including accounts, inventory, equipment, general intangibles, deposit accounts and proceeds
  • An assignment of leases and rents and an assignment of agreements affecting real estate, as additional security
• The budget carries ground rent of $87,500 per month.

Cash Collateral

• The final order grants the cash collateral motion [D.I. 152] on a final basis as to the borrowers, which had used the lender's cash collateral under a series of interim orders [D.I. 625, 843, 979]. Cash collateral is defined as the borrowers' cash and cash equivalents on hand at the petition date and received postpetition, to the extent the lender and any other putative prepetition secured parties have an interest in it.
• The borrowers may use new money DIP proceeds and prepetition collateral, including cash collateral, solely to the extent and for the purposes permitted in the approved DIP budget, subject to the permitted variance, the term sheet and the final order.
• Before the final order, the consent order amended the operative cash collateral order, the third interim order entered Sept. 1, 2026 [D.I. 979], to extend its Sept. 11, 2026 date to Oct. 2, 2026 and to substitute the DIP budget for its budget.
• The lender is not entitled to assert a section 507(b) claim on account of use of cash collateral consistent with the approved budget.

Interest Rate

• 6.56% per annum, the non-default rate for the prepetition obligations, on all advances made under the DIP loan
• Default Rate Increase: an additional 5.0% (500 basis points) after maturity or the occurrence of an event of default
• Accrued interest is due and payable monthly in arrears on the first day of each month following the first advance, calculated on actual days elapsed over a 360-day year. All remaining accrued and unpaid interest is due in cash on the maturity date, together with principal, late fees, the lender's reasonable legal fees and disbursements, and any other charges.
• The budget exhibit carries the DIP interest accrual line at 7%, not the 6.56% rate stated in the term sheet, and reflects both a weekly accrual added to the ending DIP balance and a separate monthly cash interest payment.

Fees

• Finance fee: 1% of the aggregate of all advances made under the DIP loan. No commitment fees or unused line fees are specified.
• Lender Professional Fees: the final order authorizes and directs the borrowers to pay the reasonable and documented attorneys' fees and disbursements and out-of-pocket expenses of the lender in its DIP capacity, as provided in the approved budget, without fee applications, compliance with the U.S. Trustee's guidelines or further court approval. Summary invoices, which may be redacted for privilege and work product without waiver, go to borrowers' counsel, the U.S. Trustee and committee counsel.
• A review party may object in writing, stating its grounds with particularity, to the affected professional within 10 calendar days after delivery. Absent objection, the invoices are paid promptly after the review period; if an objection is made, the undisputed portion is paid and the disputed portion awaits agreement or a court order. The term sheet instead requires an objecting party to file its objection with the court within ten days.
• Invoices are payable regardless of whether they are accounted for in the approved budget then in effect, and such payments are not counted in determining the permitted variance.

Maturity

• The earliest to occur of:
  • The effective date of a confirmed plan in the cases
  • Closing on a sale or other disposition of all or a substantial portion of the assets of any of the borrowers
  • Conversion of any of the cases to Chapter 7
  • Dismissal of any of the cases
  • Appointment of a Chapter 11 trustee
  • Acceleration of the DIP loan and termination of further advances following an event of default
  • Six months from the date of issuance, subject to an automatic 60-day extension if a sale of the borrowers' real property has been approved but remains pending closing
• The parties may agree in writing to extend the maturity date.

Carve Out

• The final order makes the prepetition liens, the DIP liens, the adequate protection liens and the superpriority claims subject and subordinate to a carve-out equal to the sum of:
  • Fees payable to the Clerk of the Court and the U.S. Trustee under 28 U.S.C. § 1930(a), plus interest at the statutory rate
  • The cumulative amount of shared services payable by the borrowers as set forth in the approved budget through the end of the budget period
  • All reasonable fees and expenses up to $25,000 incurred by a trustee under section 726(c)
• The term sheet's carve-out, defined as Case Administration Fees, consisted of only the first two components.
• The carve-out and the approved budget are not a cap on court fees, U.S. Trustee fees, fees of professionals retained by the borrowers or the committee, or intercompany administrative claims payable by the borrowers. As with the other facilities, the carve-out carries no component for those professionals' fees, and no investigation budget is provided.

Use of Proceeds

• Proceeds may be used solely for maintenance and repairs and other costs of maintaining the borrowers' properties and operating expenses, including shared services and other related costs, in accordance with the approved budget.
• The final order's findings add that the borrowers need the facility and cash collateral to continue their businesses, maintain vendor, supplier and customer relationships, implement a marketing and sale process, pay any required adequate protection payments, and pay administration costs and other working capital needs.
• No proceeds of the new money DIP loans may be used to assert claims or causes of action against the lender or its agents, or to challenge the DIP facility, DIP obligations, DIP liens, prepetition secured obligations or prepetition liens. That limitation does not affect the committee's right of investigation in connection with its challenge rights.

Avoidance Actions

• The final order grants DIP liens on all property of the borrowers other than causes of action of the borrowers or their estates. The adequate protection liens do not attach to chapter 5 causes of action or their proceeds.
• To the extent any DIP liens or adequate protection liens attach to cash constituting proceeds of a cause of action, the lender must look last to those proceeds and seek recovery first from other collateral. The term sheet states that the DIP liens extend to the proceeds of any causes of action, subject to the same look-last requirement.

Challenge Period

• The borrowers stipulate to the prepetition secured obligations under the mortgage loan agreement and to the validity, enforceability, first priority and perfection of the prepetition liens. The stipulations bind the borrowers and any successor immediately upon entry of the final order.
• The stipulations bind all other parties in interest, including the committee and any trustee, unless a party with proper standing and authority commences, and prevails in, a challenge proceeding by the challenge deadline. A challenge proceeding is any adversary proceeding, contested matter or other proceeding that would contradict the stipulations. The challenge deadline is 60 calendar days after entry of the final order, or any later date ordered by the court for cause on a timely motion.
• A standing motion filed before the deadline tolls it solely for the moving party during the motion's pendency. Absent a timely challenge proceeding, the stipulations become binding on all parties in interest without further order.
• Nothing in the final order confers standing to pursue any challenge proceeding based on an estate cause of action, and all rights to object to a standing request are reserved.
• The challenge provision is directed at the stipulations and does not reference the roll-up.

Securities and Priorities

• Effective as of entry of the interim DIP order, the lender is granted valid, enforceable, non-avoidable and automatically perfected DIP liens under sections 364(c)(2) and 364(d) on all prepetition and postpetition property of the borrowers, personal and real, other than causes of action. The term sheet also cites section 364(c)(3).
• Subject to the carve-out, the DIP liens are senior to all other security interests in, liens on or claims against the DIP collateral, except any shared services administrative expense claim against the borrowers as defined in the final cash management order [D.I. 1296, Ex. A].
• The DIP liens are perfected without any filing, recording or other action, including any deposit account control agreement; the term sheet permits the lender to make state, UCC or mortgage filings with the borrowers' cooperation.
• The term sheet describes the DIP liens as senior to any other liens granted in the cases, including pre- and postpetition liens granted to the lender itself. That structure differs from the First Financial facility, where the DIP liens are junior to the prepetition liens to preserve Qualified Mortgage status, and from the Bank of New Hampshire facility, where they are pari passu.
• Under section 364(c)(1), the DIP obligations constitute allowed superpriority administrative expense claims against the borrowers, with priority over all other obligations, liabilities and indebtedness of the borrowers except any shared services administrative expense claim. The term sheet cites section 364(d)(1) for the superpriority claim and makes it subject to the carve-out for Case Administration Fees.
• The DIP obligations are entitled to the full protection of section 364(e) in the event the interim DIP order or the final order is vacated, reversed or modified on appeal.

Roll-Up

• Upon entry of the final order and full funding of the new money DIP loans authorized under it, $692,400 of the prepetition secured obligations is immediately and automatically deemed converted into roll-up DIP loans on a cashless basis.
• The term sheet sizes the roll-up as twice the amount of cash funded for the shared services agreement identified in the approved budget and makes it equal in right and priority to the DIP loan. The final order states a fixed $692,400 rather than the formula.

Adequate Protection

S&T Bank

• As adequate protection for any postpetition diminution in value of its interests in the prepetition collateral, and only to the extent those interests are valid, enforceable and non-avoidable, the lender and any other prepetition secured parties receive:
  • The borrowers' payment of ground rent to their ground lessor, or alternatively payment of the fee mortgage and real estate taxes on the ground lessor's behalf, to the extent provided in the approved budget
  • Payment to the lender of principal and/or interest on the prepetition secured obligations, to the extent provided in the approved budget
  • Replacement perfected security interests under section 361(2) in all property of the borrowers that would constitute prepetition collateral, solely to the extent of diminution caused by the DIP obligations, DIP liens and use of cash collateral. These liens are subject to the carve-out and to senior valid prepetition liens, and they do not attach to chapter 5 causes of action or their proceeds.
  • A section 507(b) superpriority administrative expense claim, on the same diminution basis and subordinate to the carve-out
• The final order's findings state that the adequate protection currently adequately protects the lender. The order does not find that the lender is entitled to postpetition interest under section 506(b).

Waivers

• Under the final order, for amounts actually funded under the approved DIP budget:
  • Section 506(c): no administration costs may be charged against or recovered from the DIP collateral or the prepetition collateral without the prior written consent of the DIP lender or the prepetition lender, as applicable
  • Section 552(b): the lender is entitled to the rights and benefits of section 552(b), and no party may invoke the "equities of the case" exception as to proceeds, products, offspring or profits of the prepetition collateral
  • No marshaling as to the DIP collateral or the prepetition collateral, subject to the look-last requirement for proceeds of causes of action
• The term sheet contains corresponding waivers by the borrowers for amounts actually funded under the approved budget.

Permitted Variance

• Under the final order, actual cumulative disbursements under each approved DIP budget for any measurement period may not vary by more than 15% of projected cumulative disbursements without the lender's written consent. That consent may not be unreasonably withheld and may be given by email. Payments of DIP professional fees and expenses are excluded from the calculation.
• A weekly budget compliance report setting forth actual results for each line item, as of two Sundays prior to the current week and on a weekly basis from the petition date, is due to the lender and the committee by 5:00 p.m. ET each Friday.
• The term sheet tests cumulative disbursements at 15% of the projected amount, measured weekly. It also requires a weekly report showing uses of all DIP loan advances and cash collateral and any variances, and any other financial information the lender reasonably requests.
• The initial DIP budget attached to the consent order, as it may be modified by Exhibit 2 to the final order, is a weekly cash flow forecast for 2547 Brindle Drive Real Estate LLC (Susquehanna). It is dated Aug. 31, 2026 and runs through Jan. 1, 2027, carrying the following monthly lines:
  • Rent income of $191,700
  • Ancillary income of $2,300
  • Reimbursement income of $41,600
  • Ground rent of $87,500
  • Interest expense of $75,500
  • Principal repayment of $33,700
• The budget reflects a beginning DIP balance of $107,600 in the week ended Sept. 4, 2026 and aggregate DIP draws of approximately $863,400 over the forecast period. Its ending DIP balance is approximately $1,000,300 at Jan. 1, 2027, inclusive of $14,600 in DIP fees and $15,800 in capitalized interest.

Conditions Precedent

• Entry of an interim order in form and substance satisfactory to the lender and its counsel
• Entry of an order approving use of the lender's cash collateral in form and substance satisfactory to the lender and its counsel, which may be the interim order itself
• The term sheet is not binding until executed and becomes null and void, absent the lender's written consent, if the borrowers have not filed a request for entry of the interim order by Sept. 16, 2026 or if the interim order is not entered by Sept. 17, 2026. The consent order was entered Sept. 16, 2026.

Events of Default and Remedies

• Events of default, as defined in the term sheet, include:
  • Failure to comply with the approved budget, subject to the permitted variance, or with the final term sheet or any of its other provisions
  • Failure to obtain a final order by Oct. 2, 2026
  • Conversion or dismissal of any of the cases
  • Failure to maintain adequate insurance on the property subject to the DIP liens
  • Failure to make monthly interest payments on the DIP loan, or to pay the DIP loan and all related obligations at maturity
  • Failure to seek court approval of a sale of substantially all of the borrowers' real property, including their leasehold interest, by Nov. 30, 2026 and to close on a sale by Dec. 31, 2026; unlike the First Financial and Bank of New Hampshire facilities, this milestone carries no extension to Jan. 31, 2027 for a signed purchase agreement
  • Filing a Chapter 11 plan that does not propose to repay the DIP loan in full in cash on the effective date, absent the lender's consent
  • Seeking postpetition financing secured by the prepetition collateral from another party, or to use the lender's cash collateral, without its written consent
  • Entry of any order reversing, amending, supplementing, staying, vacating or modifying the interim or final order, or an application for such an order, without the lender's prior written consent
  • Entry of any order granting another superpriority administrative expense claim or lien pari passu with or senior to the lender's DIP protections
• Under the final order, upon an event of default the stay is modified, without further order, to permit the lender to deliver a remedies notice by email to counsel for the debtors, the U.S. Trustee and committee counsel. Effective not sooner than ten business days after delivery, the lender may:
  • Terminate, reduce or restrict any remaining commitments
  • Accelerate all DIP obligations
  • Terminate the DIP facility and the term sheet as to further obligations
  • Revoke its consent to use of cash collateral
  • Exercise any right or remedy against the DIP collateral set forth in the term sheet
• During the remedies notice period, the borrowers and the committee may seek emergency relief, subject to the court's availability. If they do, the remedies notice period automatically extends until the court adjudicates the emergency motion.
• The term sheet adds that the lender may not exercise remedies if the court has scheduled or is in the process of scheduling a hearing on the alleged default.

Terms Not Addressed

• The final order and term sheet do not contain any of the following:
  • A stated outstanding amount of the prepetition obligations
  • A release of the lender
  • An indemnification provision
  • A credit bid provision
  • An investigation budget
  • An express mandatory prepayment or net proceeds waterfall
  • A plan-discharge waiver under section 1141(d)(4)

Key Dates

• Petition date: June 4, 2026; joint administration approved June 12, 2026 [D.I. 35]. The committee was appointed Aug. 21, 2026, which the final order cites as [D.I. 846], while the First Financial and TriState motions cite the appointment at D.I. 518.
• Cash collateral motion filed June 24, 2026 [D.I. 152]; interim cash collateral orders [D.I. 625, 843, 979], the last entered Sept. 1, 2026
• DIP approval request [D.I. 1109]; term sheet dated and executed by counsel Sept. 15, 2026; consent order entered Sept. 16, 2026 [Doc 1121], which the final order cites as the interim DIP order at [D.I. 1221]
• Initial objection deadline: Sept. 24, 2026 at 4:00 p.m. prevailing Eastern time; supplemental objection deadline for objections that could not have been raised earlier: Sept. 28, 2026 at 4:00 p.m. prevailing Eastern time
• Final hearing held Oct. 1, 2026; final order entered Oct. 2, 2026 [Doc 1316], the date by which the term sheet required a final order
• Challenge deadline: 60 calendar days after entry of the final order (Dec. 1, 2026), subject to extension for cause and standing-motion tolling; sale approval motion by Nov. 30, 2026; sale closing by Dec. 31, 2026; budget runs through Jan. 1, 2027

Governing Law and Jurisdiction

• The bankruptcy court retains jurisdiction to hear, determine and enforce all matters arising from or related to the DIP facility, the term sheet and the final order. If the court does not have or exercise jurisdiction, the borrowers, the DIP lender and the prepetition lender submit to the federal and state courts of New Jersey, waive trial by jury, and agree that New Jersey law governs to the extent state law applies.

$3.5M 830 County Road 64 / TriState Capital Bank DIP Terms

Borrower(s) / Guarantor(s)

• 830 County Road 64 Real Estate LLC and 830 County Road 64 Leasing LLC, as borrowers, jointly and severally liable for all obligations under the DIP loan. The borrowers hold the leasehold interest in the Big Flats Shopping Center, 831, 830, 821 and 845 County Road 64, Big Flats, New York, under the ground lease.
• No guarantors are identified in the motion, the interim order or the term sheet.
• The motion [Doc 1267] was filed Sept. 29, 2026. The interim order was entered Oct. 5, 2026 [Doc 1344], following an interim hearing held Oct. 1, 2026.

Agent / Lender(s)

• TriState Capital Bank, as DIP lender and as administrative agent under the existing loan documents for itself and Wayne Bank as prepetition lenders and for itself as DIP lender. Cullen and Dykman LLP acts as counsel to TriState and the agent.
• Elmira Real Estate Enterprises LLC is the landlord under the ground lease.

DIP Commitments

• A secured superpriority debtor-in-possession non-revolving line of credit in a principal amount of up to $3,500,000:
  • Up to $2,141,400 available upon entry of the interim order, pursuant to the approved budget
  • The remaining amount available upon entry of the final order, pursuant to the approved budget
• The interim order describes the final tranche as "no less than" $1,658,400, which together with the $2,141,400 interim tranche totals $3,799,800, exceeding the $3,500,000 aggregate cap stated in the same order, the motion and the term sheet.
• Advances are structured as protective advances under Sections 4.3, 5.1 and 5.8 of the leasehold mortgage. The interim order cites Sections 4.3 and 5.1. Repayment carries the priority of protective advances under the leasehold mortgage, and the DIP loan, with associated interest and fees, is to be repaid first out of the proceeds of any sale of the ground lease, subject to the carve-out.
• Advances repaid may not be readvanced without the DIP lender's consent, which it may give or withhold in its sole discretion.
• Advance requests may be made on a form to be provided by the DIP lender no more frequently than bi-monthly and only for projected permitted uses for the subsequent two-week period under the approved budget. Each request must be accompanied by a list of the specific construction-related or other expenditures, with an explanation of why any non-construction expenditure cannot be funded from rents. To the extent cash flow from the ground lease is sufficient, shared services and other preservation expenses are paid from cash flow rather than DIP advances.
• Amendments, waivers and modifications that are not material require no further court approval and must be provided to the U.S. Trustee and committee counsel substantially concurrently with being implemented; the shared services line item in any amended approved budget may not be reduced from the prior approved budget without the committee's consent.
• Where the documents conflict, the interim order controls over the DIP loan documents, the motion and the interim cash collateral orders [D.I. 264, 553, 728, 980, 1185]; as between the motion and the DIP loan documents, the loan documents govern. The term sheet governs over the existing loan documents where they conflict, but is to be interpreted whenever possible to supplement the agent's and the DIP lender's rights under them.
• The chief restructuring officer, Perry Mandarino, concluded that the borrowers require up to $3,500,000 to fund protective advances through the anticipated sale process, considering projected cash flows, construction expenditures, tenant improvement obligations, shared services and other operating costs. The motion relies on a TriState-specific DIP declaration filed contemporaneously, while the interim order recites the earlier DIP declaration [D.I. 1177].
• The term sheet is captioned as subject to further party review and approval, and states that it is for discussion purposes only and non-binding. The interim order nonetheless binds the debtors and TriState to its terms upon entry, pending execution and delivery of the DIP loan documents.

Roll-Up

• In consideration of the DIP loan, a portion of the existing indebtedness is converted into a secured superpriority postpetition administrative expense claim equal in right and priority to the DIP loan's administrative claim. The roll-up equals twice the amount of cash funded for the shared services agreement under the approved budget or any approved budget under any current or superseded cash collateral order, and is secured by a pari passu new lien on all of the borrowers' property.
• The DIP budget's shared services agreement line totals $522,300 through Jan. 1, 2027, twice which is approximately $1.04 million, before any amounts funded under prior cash collateral budgets. The interim order does not address the roll-up.

Prepetition Debt

• TriState and Wayne Bank made a loan in the original principal amount of $28,000,000 under a Credit Agreement dated Sept. 27, 2024 and two mortgage notes, with TriState's commitment at $23,000,000 and Wayne Bank's at $5,000,000.
• As of the petition date, the borrowers were jointly and severally indebted for principal of not less than $26,777,860, plus at least $143,552.65 of accrued and unpaid interest, plus fees, costs, expenses and other charges.
• The prepetition obligations are secured by first-priority liens on substantially all of the borrowers' assets under the existing loan documents, including:
  • The Leasehold Mortgage, Security Agreement and Fixture Filing dated Sept. 27, 2024
  • The ground lease dated Sept. 27, 2024
  • A ground lease recognition, subordination, non-disturbance, estoppel and attornment agreement dated Sept. 27, 2024

Cash Collateral

• The interim order authorizes the borrowers to use all of the prepetition lenders' cash collateral, solely for the purposes set forth in the interim order and consistent with the approved budget, through the termination date. Cash collateral is defined as all of the borrowers' cash, deposits, receivable collections and other dispositions of prepetition collateral, rents collected on and after the petition date, and proceeds of the foregoing.
• The court previously authorized use of the agent's cash collateral on an interim basis under orders [D.I. 264, 553, 728, 980, 1185] entered on the cash collateral motion filed June 24, 2026 [D.I. 152].
• The borrowers stipulate that, as of the petition date, they maintained no bank accounts other than those listed on Exhibit 1 to the cash management order [D.I. 219].
• Unauthorized use of DIP advances or cash collateral, including any transfer to a debtor or affiliate, is an event of default under the term sheet.

Interest Rate

• 12.00% per annum, fixed, on principal and the finance fee, paid by the DIP lender debiting the borrowers' debtor-in-possession operating account at the DIP lender
• Default Rate Increase: an additional 5.0% (500 basis points) on principal and the finance fee after maturity or an event of default
• A 5% late fee applies to any amount not paid within five days of its due date.
• Accrued interest is due monthly in arrears on the first day of each month following the first advance, calculated on actual days elapsed over a 360-day year. All remaining accrued and unpaid interest, together with principal, late fees, the DIP lender's legal fees and disbursements and other charges, is due in cash on the maturity date.
• The budget carries both a weekly DIP interest accrual at 12% added to the ending DIP balance and a separate line for DIP interest payments in cash monthly in arrears of $15,400, $23,900 and $27,200.

Fees

• Finance fee: 2.00% of the aggregate of all advances. The budget carries DIP fees of $64,300 against the initial $2,141,400 draw, or 3% of that amount. No commitment fees or unused line fees are specified.
• Lender Professional Fees: reasonable and documented attorneys' fees, disbursements and out-of-pocket expenses of the DIP lender and the agent, including those of Cullen and Dykman LLP, in connection with the DIP loan, the existing indebtedness and the Chapter 11 cases of the borrowers and their affiliates. These fees are not subject to court approval or fee applications.
• The interim order sets a 10-calendar-day review period after receipt of invoices by debtors' counsel, the committee and the U.S. Trustee. A served written objection limits payment to unobjected amounts, and invoices must carry the same detail required under the other facilities. The term sheet instead requires an objecting party to file its objection with the court within ten days, and provides that statements are payable regardless of whether reflected in the approved budget and are not counted against the permitted variance.

Maturity

• The earliest to occur of:
  • The effective date of a confirmed plan
  • Closing on a sale or other disposition of all or a substantial portion of either borrower's assets
  • Conversion of either case to Chapter 7
  • Dismissal of either case
  • Appointment of a Chapter 11 trustee or an examiner
  • Notice from the landlord threatening or purporting to cancel or terminate the ground lease that is not stayed by the court within 15 days of the borrowers' or their counsel's receipt
  • Acceleration following an event of default
  • Dec. 31, 2026
• The DIP lender may extend the maturity date in writing only, in its sole discretion.
• The interim order provides that, following an acceleration or termination of further advances, all DIP obligations are immediately due and payable and authority to use cash collateral ceases, subject to limited use during the remedies notice period.
• The DIP obligations are not discharged by plan confirmation and must be paid in full on the plan effective date, with discharge waived under section 1141(d)(4).
• The DIP protections continue until consummation of an acceptable plan, meaning one that:
  • Is acceptable to TriState, the agent and the prepetition lenders
  • Pays the DIP obligations in full in cash
  • Does not impair their claims or liens without written consent
  Alternatively, they continue until the DIP obligations are paid in full and the commitments terminate. The DIP protections survive conversion and dismissal, with the court retaining jurisdiction under section 349(b), and bind any trustee.

Carve Out

• Consists of the sum of:
  • Clerk and U.S. Trustee fees under 28 U.S.C. § 1930(a) owed by the borrowers, plus statutory interest, not subject to any budget
  • On conversion, chapter 7 trustee fees and expenses not to exceed $10,000; the interim order cites section 726(b), while the term sheet and the motion cite section 726(c)
  • The cumulative amount of shared services payable by the borrowers under the approved budget through the end of the budget period, to the extent not otherwise funded
• The carve-out is senior to all liens and claims granted by the interim order, and any payment of it is added to the DIP obligations. It carries no component for debtor or committee professional fees, and neither TriState, the agent nor the prepetition lenders are responsible for those fees; it is not a cap on them.
• Investigation Budget: no more than $50,000 of shared services proceeds of the DIP facility, DIP collateral or prepetition collateral, including cash collateral, may be used by the committee or a Chapter 7 or Chapter 11 trustee solely to investigate claims against the agent or prepetition lenders within the challenge period.

Use of Proceeds

• Under the term sheet, the DIP loan may be used solely as protective advances under the leasehold mortgage and other existing loan documents for the preservation, maintenance, management, operation, re-leasing and sale of the ground lease, as permitted in the approved budget. Permitted uses include:
  • Construction-related costs for tenant improvements at the shopping center that the borrowers became or will become contractually obligated to complete as debtors in possession
  • Shared services payable to DAMIS Holdings LLC for professional and employee services related to the contemplated sale
  • The DIP lender's professional fees in connection with the borrowers' defaults and the contemplated sale
  • Maintenance and repairs, capital expenditures, broker's, attorneys' and other professionals' fees related to leasing or a sale, ground rent, insurance, real estate taxes and utilities
• The interim order limits proceeds to the preservation, maintenance, management, operation and re-leasing of the mortgaged property, as expressly authorized to be advanced under the post-default provisions of the leasehold mortgage. It excludes the debtors' general bankruptcy administration costs and costs not directly incident to the property.
• No proceeds may satisfy any obligation of a non-borrower debtor except indirectly through shared services under the approved budget, or be used to assert claims against or challenge the claims or liens of TriState, the agent or the prepetition lenders, subject to the committee's investigation rights.

Credit Bid

• Under the term sheet, the agent and the DIP lender may collectively credit bid all or any portion of the DIP loan obligations and the existing indebtedness under section 363(k) in any sale of the ground lease or other collateral, and the DIP lender is deemed a qualified bidder under the bid procedures order [D.I. 1048]. The interim order contains no credit bid paragraph.

Avoidance Actions

• Subject to and effective upon entry of the final order, the DIP superpriority claims are payable from, and the first-priority lien on unencumbered property extends to, avoidance-action proceeds, with TriState recovering from those proceeds only after all other DIP collateral. The term sheet provides that the DIP liens extend only to the proceeds of the borrowers' causes of action, not the causes of action themselves.

Challenge Period

• Under the term sheet, the debtors stipulate to the following:
  • The existing indebtedness of $26,777,860.00 in principal and $143,552.65 in interest, plus other charges, is valid, binding and not subject to offset, defense, counterclaim, recharacterization, subordination or other challenge, subject to application of certain postpetition payments.
  • The agent holds valid, perfected, first-priority liens on the ground lease and the borrowers' other collateral and proceeds.
  • They are not aware of any claims or defenses against the agent, and waive any that exist.
  • They will not contest the existing indebtedness or the related liens.
• Under the term sheet, the stipulations bind the committee and other non-debtor parties after a challenge deadline of 60 calendar days after entry of the interim order, which places it at Dec. 4, 2026, unless a party commences and actively prosecutes a challenge proceeding or a standing motion by that date. Challenge rights extend only to the existing indebtedness and to the leasehold mortgage lien to the extent it secures the existing indebtedness, not to the DIP loan.
• The interim order sets the challenge deadline at Nov. 30, 2026, four days before the term sheet's 60-day period expires. That date extends, on conversion or appointment of a trustee, to the later of the time remaining and 45 days after appointment. A standing motion with a draft complaint attached tolls the period only for the moving party, as to the claims in the draft complaint, until two business days after the motion is resolved.
• Absent a timely challenge, the prepetition obligations become allowed claims and the prepetition liens are deemed valid and perfected as of the petition date.
• Upon entry of the interim order, and subject to third-party challenge rights, the debtors release the agent, the prepetition lenders and their affiliates and representatives from all claims relating to the DIP and prepetition obligations, liens and loan documents, excepting claims found by final order to result primarily from bad faith, fraud, gross negligence or willful misconduct.

Securities and Priorities

• Under the term sheet, the DIP loan constitutes additional obligations under the existing loan documents secured by the leasehold mortgage, and the DIP liens are granted under sections 364(c)(2) and 364(d). The DIP liens carry the priority of the leasehold mortgage and are senior to all other liens granted in the cases and to any liens or claims of the DAMIS debtors, including intercompany advances by DAMIS Holdings or its affiliates. They are deemed perfected without further filings.
• The orders are to provide that the leasehold mortgage remains a "Qualifying Mortgage" and the agent remains a "Qualifying Mortgagee" under the ground lease and the recognition agreement after the protective advances are made. The interim order contains that finding.
• The interim order grants the DIP lender liens on the following basis:
  • Senior liens on unencumbered assets
  • Liens pari passu with the prepetition lenders on encumbered assets, including proceeds of claims and causes of action
  • Under section 364(c)(2), first-priority liens on unencumbered property, including avoidance-action proceeds upon entry of the final order
  • Under section 364(c)(3), liens junior only to permitted tax and ordinary-course statutory liens
  • Under section 364(d)(1), priming liens senior to all existing liens other than permitted liens and the prepetition liens, with the DIP liens pari passu with the prepetition liens
• Subject to the carve-out, the DIP obligations constitute superpriority administrative expense claims under section 364(c)(1) in the interim order, while the term sheet cites section 364(d)(1). These claims have priority over all other claims, including those under sections 503(b), 506(c), 507(a) other than 507(a)(1), 507(b), 726, 1113 and 1114. The term sheet makes the DIP superpriority claim senior to any superpriority claims of the agent, subject to the carve-out.
• No lien or claim senior to or pari passu with the DIP protections may be granted without the DIP lender's consent. The anti-assignment override, surety bond reservation and insurance requirements, naming TriState and the agent as loss payees, follow the Bank of New Hampshire order.

Adequate Protection

TriState Capital Bank, as Agent for TriState Capital Bank and Wayne Bank

• Monthly cash interest on the outstanding principal of the prepetition obligations at the non-default rate under the existing loan documents, payable on the first business day of each month following entry of the interim order; the interim order does not state the rate
• Monthly principal amortization and outstanding real estate taxes as set forth in the approved budget; the budget carries monthly interest expense of $160,200 and principal repayment of $34,800
• Section 507(b) superpriority administrative expense claims for diminution in value, subordinate only to the carve-out and the DIP superpriority claims
• Payment of the reasonable and documented fees and expenses of TriState and the agent, including Cullen and Dykman LLP, without court approval
• Maintenance of cash management consistent with the cash management order and compliance with reporting requirements, with the committee entitled to request reporting
• The agent is deemed to have requested stay relief and adequate protection from the petition date, with section 507(b) rights and the right to seek further adequate protection preserved, and without a finding that the protection granted is adequate or that the prepetition lenders are entitled to postpetition interest under section 506(b)

Waivers

• The term sheet waives the borrowers' rights under section 506(c), the section 552(b) equities-of-the-case doctrine and marshaling as to the existing indebtedness and the DIP loan. The interim order applies the section 506(c) and 552(b) waivers upon its entry, with the marshaling waiver effective upon entry of the final order.

Permitted Variance

• Tenant improvement construction disbursements may not vary on a cumulative basis by more than 10% of the approved budget, measured weekly. Other disbursements may not vary by more than 15%. The interim order tests operating disbursements for any one-week period against the term sheet's permitted variances.
• Testing begins two weeks after entry of the interim order, each Friday, as of the week ending two Sundays prior. Variance reports are due to TriState, the agent, their advisors and committee counsel by 5:00 p.m. prevailing Eastern time each Friday, with commentary on deviations greater than $50,000 beginning the third week.
• The budget filed with the motion, prepared for 830 County Road 64 Leasing LLC, is dated Sept. 28, 2026, marked as a draft subject to change, and runs weekly from the week ending Oct. 9, 2026 through Jan. 1, 2027. Over that period it projects:
  • Total receipts of $1,633,500, including rent income of $1,262,500 in three monthly installments of $420,800 and reimbursement income of $360,400
  • Operating disbursements of $2,474,100, including real estate taxes of $816,700 in the first week, shared services of $522,300, ground rent of $350,000 and commissions and fees of $226,200
  • Capital expenditures of $1,457,400, of which $1,167,400 in the first week
  • Interest expense of $480,600 and principal repayment of $104,400
• The budget projects DIP draws of $2,909,400 and an ending DIP balance of $3,040,300 at Jan. 1, 2027, inclusive of $64,300 in DIP fees and $73,500 in accrued interest. It carries total debt rising from $26,777,900 to $29,818,100.

Conditions Precedent

• Entry of the interim order for initial availability, or the final order for the remaining amounts, in form and substance satisfactory to the DIP lender in its sole discretion, including a finding that the advances are protective advances under the leasehold mortgage. The entered interim order contains that finding, though an earlier statement of it in the same order breaks off mid-sentence.
• The DIP lender's internal approval
• Acknowledgments, satisfactory to the DIP lender and the agent in their sole discretion, from the following parties:
  • From Wayne Bank, that the advances are protective advances and that the DIP lender is to be repaid first from sale proceeds
  • From the landlord, that the advances are protective advances and that the leasehold mortgage remains a Qualifying Mortgage and the agent a Qualifying Mortgagee
• The absence of a default or event of default and compliance with the approved budget, subject to the permitted variances
• An order approving use of the agent's cash collateral satisfactory to it, and the landlord's consent to the interim order
• The term sheet is not binding until executed by the DIP lender, the agent and the borrowers, and becomes null and void, absent their written consent, if the interim order is not entered by Oct. 2, 2026. The interim order was entered Oct. 5, 2026 [Doc 1344] and does not recite any such consent.

Covenants and Sale Milestones

• Seeking court approval of a sale of substantially all of the borrowers' real property, including the leasehold interest, by Nov. 30, 2026, and closing by Dec. 31, 2026, with no extension for a signed purchase agreement
• Paying the DIP lender in full for the DIP loan and the agent in full for the existing indebtedness at the closing of any such sale
• Moving to assume the ground lease, or to extend the time to do so, within the section 365(d)(4) period
• The debtors, their professionals and the broker must provide weekly sale-process updates and copies of indications of interest, letters of intent and bids within one day of receipt. The court-approved broker must hold status calls with the DIP lender and the agent no more than weekly. TriState and the agent also have reasonable access to books, records, personnel and premises.
• Obtaining a final order by Oct. 23, 2026

Events of Default and Remedies

• Events of default under the term sheet and the interim order include:
  • Unauthorized use of DIP advances or cash collateral, including any transfer to a debtor or affiliate
  • Failure to comply with the approved budget, subject to the permitted variance, the term sheet, any covenant of the existing loan documents, or the interim or final order
  • Failure to obtain a final order by Oct. 23, 2026
  • Conversion or dismissal of either case, or appointment of a trustee, receiver or examiner with enlarged powers
  • Failure to maintain adequate insurance, to make monthly DIP interest or adequate protection payments, or to repay the DIP loan at maturity
  • A landlord notice threatening or purporting to cancel or terminate the ground lease that is not stayed within 15 days, termination or cancellation of the ground lease, or failure to move to assume the ground lease or extend the time to do so under section 365(d)(4)
  • Failure to meet the sale approval and closing milestones, or to pay the DIP loan and existing indebtedness in full at the closing of any sale
  • Filing a Chapter 11 plan that does not propose to repay the DIP loan and the existing indebtedness in full in cash, absent the DIP lender's consent
  • Seeking postpetition financing from another lender, or use of cash collateral, without consent
  • Modification of the interim or final order without the consent of the DIP lender and the agent, or any superpriority claim or lien pari passu with or senior to the DIP protections
  • Breach of representations and warranties, unauthorized payments on prepetition debt, stay relief for foreclosure on material assets, invalidity of DIP loan documents or liens, a debtor-supported challenge, or an order avoiding payments on the DIP obligations
  • Any challenge to the characterization of the advances as protective advances or to TriState's authority to make them; as in the Bank of New Hampshire order, the lender's sole remedy for that default is to terminate the remaining commitment without affecting the DIP liens or obligations, though it may seek further relief from the court
• Under the term sheet, upon an event of default the DIP lender and the agent may act on five business days' email notice to borrowers' counsel, with copies to the U.S. Trustee and the committee. They may stop funding, terminate the commitment, accelerate, terminate cash collateral use and exercise all rights and remedies, without further order or stay relief.
• The interim order likewise modifies the stay five business days after delivery of a termination declaration, with written notice to debtors' counsel, the committee and the U.S. Trustee, consistent with the motion.
• The borrowers and the committee may seek an emergency hearing during the notice period, and remedies may not be exercised if the court has scheduled a hearing on the alleged default. During the remedies notice period cash collateral may be used only for the carve-out, shared services and critical preservation expenses. Notice of an event of default is informational only.

Indemnification

• Subject to and effective upon entry of the final order, the borrowers indemnify TriState, the agent, the prepetition lenders and their affiliates and representatives against losses arising out of the financing. The indemnity excludes successful challenges and gross negligence or willful misconduct determined by final, non-appealable judgment, ranks equally with the DIP superpriority claims, and excludes special, indirect, consequential and punitive damages. A following sentence limits liability to conduct found to have resulted solely from gross negligence, fraud, willful misconduct or breach of obligations under the DIP facility.
• TriState, the agent and the prepetition lenders are not deemed to control the debtors or to be responsible persons, owners or operators under CERCLA by reason of the financing.

Key Dates

• Petition date: June 4, 2026; joint administration approved June 12, 2026; committee appointed Aug. 21, 2026 [D.I. 518]; cash collateral motion filed June 24, 2026 [D.I. 152]
• Motion filed Sept. 29, 2026 [Doc 1267]; interim hearing held Oct. 1, 2026; interim order entered Oct. 5, 2026 [Doc 1344], three days after the term sheet's Oct. 2, 2026 entry deadline
• Objection deadline for the final hearing: Oct. 15, 2026 at 4:00 p.m. prevailing Eastern time
• Final hearing: Oct. 22, 2026 at 12:00 p.m. prevailing Eastern time; final order required by Oct. 23, 2026
• Challenge deadline Nov. 30, 2026 under the interim order (Dec. 4, 2026, 60 calendar days after entry of the interim order, under the term sheet); sale approval motion by Nov. 30, 2026; sale closing and DIP maturity by Dec. 31, 2026; budget runs through Jan. 1, 2027

Governing Law and Jurisdiction

• The bankruptcy court has jurisdiction over the parties' rights under the term sheet and retains exclusive jurisdiction over implementation, interpretation and enforcement of the interim order. If the bankruptcy court does not have or does not exercise jurisdiction, the parties submit to the federal and state courts of New York, waive trial by jury, and agree that New York law governs to the extent state law applies. The other three DAMIS facilities instead specify New Jersey courts and New Jersey law.