John Fitzgibbon Memorial Hospital - Chapter 11 DIP Terms

DIP Terms

Borrower(s) / Guarantor(s)

• John Fitzgibbon Memorial Hospital, Inc. (the "Hospital") and Fitzgibbon Health Services, each a "DIP Borrower" and collectively the "DIP Borrowers"
• The DIP Borrowers and their successors are jointly and severally liable for repayment of any funds advanced under the DIP Term Sheet and the DIP Obligations

Agent / Lender(s)

• UMB Bank, N.A., as Trustee, as DIP Lender
  • Pursuant to an Instrument of Removal and Appointment dated April 23, 2026, UMB Bank, N.A. was appointed as successor Master Trustee under the Master Indenture and successor Bond Trustee under the Bond Indenture (collectively, the "Trustee")

DIP Commitments

• A priming super-priority senior secured post-petition credit facility (the "DIP Facility") in an aggregate amount not to exceed the New Money Loan advanced plus the Roll-Up Loan (the "DIP Commitment"), comprised of:
  • New Money Loan: a debtor-in-possession loan facility in an aggregate amount not to exceed $4,000,000, to be funded in an initial draw of $2,000,000, with subsequent draws subject to the prior approval of the DIP Lender and at all times pursuant to the Approved Budget, to support operations and Case Expenses
  • Roll-Up Loan: a conversion or roll-up of the outstanding obligations under the Bond Indentures into the DIP Loan equal to approximately two times the New Money Loan advanced, with such conversion and roll-up to occur contemporaneously with each advance of the New Money Loan on a proportionate basis
    • The Bond Indentures comprise the $12,400,000 Series 2010 Health Facilities Revenue Bonds and the $7,550,000 Series 2016 Health Facilities Revenue Bonds (John Fitzgibbon Memorial Hospital, Inc.)
    • Upon funding of the DIP Loan and the conversion of the obligations under the Bond Indentures, the Roll-Up Loan constitutes part of the DIP Commitment and is entitled to all the rights, liens, and protections granted to the DIP Lender
• Funding of an interim advance of $3 million is subject to entry of the Interim DIP Order, and funding of the balance of the DIP Commitment is subject to entry of the Final DIP Order within twenty-one (21) days following the filing of the DIP Motion
• The DIP Facility is not a revolving loan, and amounts already borrowed and repaid may not be reborrowed

Cash Collateral

• "Cash Collateral" consists of (i) cash collateral as defined in Section 363(a) of the Bankruptcy Code, including any accounts receivable and general intangibles and all cash or cash equivalents, including cash in any deposit or securities accounts, wherever located; (ii) any cash or cash equivalents received as proceeds of DIP Collateral; and (iii) all other cash or cash equivalents of the DIP Borrowers
• The Debtors are authorized to use Cash Collateral in accordance with the Approved Budget (subject to the Permitted Variances), subject to the occurrence of the DIP Termination Declaration Date
• Subject to the terms of the DIP Documents, the DIP Lender consents to the use of Cash Collateral to fund (i) working capital, (ii) general corporate purposes, (iii) approved restructuring costs and expenses, and (iv) any other fees required under the DIP Documents

Interest Rate

• PIK interest at 8.25%, with all interest due and payable on the Maturity Date, computed for the actual number of days elapsed on the basis of a 360-day year
• Default Interest Rate: 10.25%, accruing from and after the date on which an Event of Default occurs

Fees

• Exit Fee: 2.0% of the DIP Loan, fully earned and non-refundable upon entry of the Interim DIP Order and payable on the Maturity Date
• The reasonable and documented fees and expenses of the DIP Lender and its professionals are payable in kind and added to the principal balance of the DIP Facility on the Maturity Date
• The DIP Fees are added to the balance of the DIP Facility and constitute part of the DIP Obligations

Maturity

• The "Maturity Date" means the earliest of:
  • The date on which an order is entered converting the case to Chapter 7
  • The effective date of a plan of reorganization
  • November 30, 2026
• Unless the DIP Borrowers request an extension and the DIP Lender, in its sole and reasonable discretion, consents in writing

Milestones

• The DIP Borrowers agree to comply with the following deadlines, each of which may be extended or waived with the prior written consent of the DIP Lender in its sole discretion:
  • Entry of the Interim DIP Order on or before June 12, 2026
  • Entry of the Final DIP Order by July 3, 2026
  • Filing, no later than May 29, 2026, of a revised asset purchase agreement for the sale of the Debtors' assets to Strawberry Fields REIT through a Section 363 sale (the "Sale")
  • Entry of an order approving the Sale no later than July 10, 2026
  • Consummation of the Sale no later than August 31, 2026

Events of Default

• The occurrence of any of the following constitutes an Event of Default:
  • The Interim DIP Order or Final DIP Order ceasing to be in full force and effect, or being vacated, reversed, stayed, modified, or amended; or the Interim DIP Order not having been entered on or before June 12, 2026, or the Final DIP Order not having been entered by July 3, 2026
  • Failure of the Debtors to comply in any material respect with the DIP Term Sheet or the applicable order approving the DIP Facility
  • Failure of the Debtors to comply with the Permitted Variances, to have an Approved Budget, or to comply with any covenant or agreement in the DIP Documents (subject, for certain covenants, to a five business-day grace period)
  • Any payment by a Debtor on account of prepetition indebtedness or payables other than as authorized by the Bankruptcy Court and set forth in the Approved Budget
  • Dismissal or conversion of any Chapter 11 Case to Chapter 7; appointment of a Chapter 11 trustee or examiner with enlarged powers; or the grant of any other superpriority claim or lien pari passu with or senior to the DIP Liens
  • Entry of an order granting relief from the automatic stay to the holder of any lien evidencing indebtedness in excess of $1 million to permit foreclosure (excluding a grant of stay relief to Community Bank related to MOB1)
  • Any Debtor petitioning for additional financing pari passu or senior to the DIP Facility
  • Termination of the Debtors' exclusive period under Section 1121 of the Bankruptcy Code
  • Consummation of a sale of any material portion of the DIP Collateral without the DIP Lender's prior written consent, other than through the contemplated Sale or an ordinary-course sale contemplated by the Approved Budget
  • Confirmation of a plan of reorganization or liquidation that does not provide for payment in full in cash of the DIP Facility Loans or other treatment acceptable to the DIP Lender
  • Any Debtor challenging, or supporting any challenge to, the validity, perfection, priority, extent, or enforceability of the DIP Facility or the DIP Liens, or asserting or supporting any claims or investigation against the DIP Lender
  • Entry of an order sustaining an objection to the DIP Lender's claims or avoiding any of its liens
  • Allowance of any claim under Section 506(c) against any of the DIP Collateral
  • Material inaccuracy of any representation of any Debtor
  • Failure to meet any Milestone
  • The occurrence of the Termination Date

Remedies

• A "DIP Termination Event" means (i) the occurrence of the Maturity Date, or (ii) the occurrence of any material breach or Event of Default related to the DIP Facility
• Upon a DIP Termination Event, the automatic stay is vacated and modified to permit the DIP Lender to:
  • Deliver a written Remedies Notice to counsel for the Debtors, the U.S. Trustee, and counsel for the Creditors' Committee, declaring the occurrence of the DIP Termination Event (the "DIP Termination Declaration Date")
  • Declare all DIP Obligations immediately due and payable
  • Declare the suspension or termination of the DIP Facility, without affecting the DIP Liens or DIP Obligations (the "Termination Notice")
  • Charge default interest at the default rate set forth in the DIP Term Sheet
• The Debtors may seek an emergency hearing during the five (5) days following the DIP Termination Declaration Date (the "Waiting Period"); the filing of such a motion tolls the Remedies Notice Period, and the Court may only consider whether an Event of Default has occurred or is continuing
• During the Waiting Period, the Debtors may continue to use DIP Collateral (including Cash Collateral) in accordance with the Interim Order and the Approved Budget
• Following the Waiting Period, and unless the Court has entered an order finding that an Event of Default has not occurred or is not continuing, the automatic stay is automatically lifted and the DIP Lender may exercise all rights and remedies

Carve Out

• The DIP Liens and DIP Superpriority Claims are subject and subordinate to payment of the Agreed Surcharge, which is senior to all claims and liens over all assets of the Debtors, including any DIP Collateral
• The "Agreed Surcharge" means the sum of:
  • All fees required to be paid to the Clerk of the Court and the U.S. Trustee under Section 1930(a) of title 28, plus interest at the statutory rate (the "Statutory Fees")
  • $10,000 for a hypothetical Chapter 7 trustee in the event of conversion of the cases to Chapter 7
  • All unpaid Allowed Professional Fees of professionals retained by the Debtors under Sections 327, 328, or 363 (the "Debtor Professionals") and by the Committee, if any, under Sections 328 or 1103 (the "Committee Professionals")
    • Commencing on the Friday of the first full calendar week following entry of the Interim Order, and weekly thereafter, the Debtors shall fund segregated accounts (the "Funded Reserve Accounts") for the benefit of the Debtor Professionals in the amount of applicable Professional Fees set forth in the Approved Budget
    • Commencing June 17, 2026, and on the tenth day of each subsequent month, the Debtor Professionals shall submit a report of accrued fees and expenses, and the Debtors shall fund any shortfall between the budgeted and actual amounts (the "True-Up Amount")
  • The maximum Agreed Surcharge for any Committee Professionals shall not exceed $300,000.00

Use of Proceeds

• Fund the postpetition working capital needs of the Debtors pending the Final Hearing
• Pay the fees, costs, and expenses of the DIP Facility
• Pay the allowed administrative costs and expenses of the Chapter 11 Cases, fund obligations benefiting from the Agreed Surcharge, continue the orderly operation of the business, maintain business relationships with customers and vendors, make payroll, and satisfy other working capital and operational needs pending a value-maximizing transaction
• No portion of the DIP Loans, the Agreed Surcharge, or any cash collateral may be used to assert any claim, cause of action, or objection against the DIP Lender or any of the Bondholders, to challenge any claim or lien of the DIP Lender or the validity or enforceability of the Bond Documents, or to challenge any pre-petition payment or transfer to the DIP Lender

Credit Bid

• Subject to Section 363(k) of the Bankruptcy Code, entry of a Final Order, and the amounts advanced and outstanding on the DIP Facility, the DIP Lender may credit bid all or any portion of its claims, including its DIP Obligations and DIP Superpriority Claim, in connection with any proposed sale of all or substantially all of the DIP Borrowers' assets (provided that, as to MOB1, it is in the order of the DIP Lender's priority), whether occurring under Section 363, as part of a reorganization plan under Section 1123 (including a plan subject to confirmation under Section 1129(b)(2)(A)(ii)), or a sale by a chapter 7 trustee under Section 725
• The Final DIP Order shall provide that the DIP Lender and the Master Trustee have the right to credit bid the DIP Facility Loans and the Bond Obligations, in whole or in part, in connection with any sale or disposition of assets, and shall not be prohibited from making such credit bid "for cause" under Section 363(k)

Avoidance Actions

• The DIP Collateral does not include, and no DIP Liens attach to, any Avoidance Actions—causes of action that could be brought under Sections 544–548 of the Bankruptcy Code or any applicable state fraudulent-transfer or similar statute—or the proceeds thereof

Securities and Priorities

• The DIP Lender is granted allowed super-priority administrative expense claims under Section 364(c)(1) (the "DIP Superpriority Claims") for all DIP Obligations, with priority over all administrative expense and unsecured claims against the DIP Borrowers or their estates, subject only to the Agreed Surcharge
  • The DIP Superpriority Claims have recourse to and are payable from all prepetition and postpetition property and assets of the DIP Borrowers and their estates and all DIP Collateral and proceeds thereof, and may be repaid from any cash of the Debtors, including cash collateral
• The "DIP Collateral" means the DIP Borrowers' right, title, and interest in all of their existing and future-acquired property, real and personal, tangible and intangible, including cash, accounts receivable, general intangibles, payment intangibles, supporting obligations, investment property, commercial tort claims, inventory, rolling stock, machinery, equipment, subsidiary capital stock, loans, chattel paper, documents, instruments, deposit accounts, contract rights, equity interests, tax refunds, and all intellectual property, together with all rents, issues, products, offspring, proceeds, and profits generated by any item of DIP Collateral; the DIP Collateral excludes Avoidance Actions and the proceeds thereof
• To secure the DIP Obligations, the DIP Lender is granted the following DIP Liens, in each case subject to the Agreed Surcharge:
  • Pursuant to Section 364(d)(1), first-priority senior priming liens on all assets and property of the DIP Borrowers subject to Prepetition Liens (including the Prepetition Collateral), senior to the Prepetition Liens, with the exception of Community Bank's lien on MOB1 and its proceeds and the Prepetition Liens of AmerisourceBergen
    • Community Bank's lien on MOB1 remains superior to all of the DIP Lender's liens and claims; the DIP Lender is granted a springing lien attaching solely to any proceeds of MOB1 remaining after indefeasible payment in full, in cash, of all indebtedness under the Community Bank Note
    • Notwithstanding anything to the contrary, the Prepetition Liens of AmerisourceBergen and of Community Bank of Marshall shall not be primed
  • Pursuant to Section 364(c)(2), first-priority liens on all DIP Collateral not otherwise subject to valid, enforceable, and non-avoidable liens, including the +/- 44 acres of undeveloped real property in section 27/28, township 50N, range 21; provided that the DIP Liens shall not encumber any Avoidance Actions or the proceeds thereof
  • Pursuant to Section 364(c)(3), liens on all DIP Collateral subject to valid, perfected, and non-avoidable liens existing immediately prior to the Petition Date (the "Permitted Prior Liens"), which DIP Liens are junior and subordinate to such Permitted Prior Liens; the DIP Liens on MOB1 are granted under Section 364(c)(3), are junior to the prepetition liens of Community Bank, and attach only to the proceeds of MOB1
• The DIP Liens are not subject or subordinate to (i) any lien avoided and preserved under Section 551, (ii) any liens arising after the Petition Date, or (iii) any intercompany or affiliate liens, and are not subject to Sections 510, 549, or 550 of the Bankruptcy Code or made pari passu with any other lien
• The DIP Liens automatically attach and become valid and perfected immediately upon entry of the Interim DIP Order without the necessity of any further action or filing
• The DIP Borrowers shall not sell, transfer, lease, encumber, or otherwise dispose of any material portion of the DIP Collateral, other than in the ordinary course of business or as contemplated by the Interim Order or Approved Budget, without either the prior written consent of the DIP Lender or an order of the Bankruptcy Court as to MOB1 or AmerisourceBergen

Adequate Protection

Prepetition Secured Lenders

• The Prepetition Secured Lenders (the Trustee, Community Bank, and AmerisourceBergen) shall receive adequate protection solely to the extent of any Diminution in the value of their interests in the Prepetition Collateral resulting from (i) the use, sale, or lease of the Prepetition Collateral, (ii) the DIP Liens and the Agreed Surcharge, or (iii) the imposition of the automatic stay
• Adequate Protection Liens: continuing, valid, binding, enforceable, and perfected postpetition replacement liens on the DIP Collateral, subject and subordinate only to the Agreed Surcharge and the DIP Liens, which (a) are senior to all other security interests in or claims against the respective Prepetition Collateral and (b) are not made pari passu with any other lien and are not subject to Sections 510, 549, or 550 of the Bankruptcy Code
• Adequate Protection Superpriority Claims: an administrative expense claim under Section 507(b) with priority over all other costs and expenses of the kind specified in Sections 503(b) or 507(a), subject only to the Agreed Surcharge and the DIP Liens
• The grant of adequate protection is without waiver of any party's right to assert challenges, causes of action, and claims against the Prepetition Secured Lenders; the automatic stay is modified to the extent necessary to accomplish the transactions contemplated by the Interim Order

Waivers

• Subject to entry of the Final Order, and except to the extent of the Agreed Surcharge:
  • Section 506(c): The DIP Borrowers waive their right to surcharge any DIP Collateral, and no expenses of administration shall be charged against or recovered from any DIP Collateral, without the DIP Lender's prior written consent
  • The equitable doctrine of "marshaling" or any similar doctrine shall not apply with respect to the DIP Collateral or the collateral securing the DIP Facility Loans
  • Section 552(b): The DIP Lender is entitled to all rights and benefits of Section 552(b), and the "equities of the case" exception under Sections 552(b)(i) and (ii) shall not apply
  • Sections 552 and 726: Each Debtor irrevocably waives and agrees not to assert any claim or right to avoid the imposition of the DIP Liens on any property acquired by the Debtor or its estate, or to surcharge any costs or expenses incurred in connection with the preservation, protection, enhancement of, or realization upon the DIP Collateral

Permitted Variance

• The Debtors delivered an Initial DIP Budget reflecting their projected operating receipts, operating disbursements, non-operating disbursements, net operating cash flow, and liquidity for each one-week period covered thereby; the Initial DIP Budget may be modified, amended, extended, and updated in accordance with the DIP Documents, and each approved budget constitutes an "Approved Budget"
• The DIP Borrowers shall deliver to the DIP Lender a weekly budget for the 13-week period commencing on the first full week following entry of the Interim Order, which shall be approved by the DIP Lender (such consent not to be unreasonably withheld, conditioned, or delayed)
• The Debtors must comply with the Approved Budget, subject to the Permitted Variances