FACILITIES FINANCING AUTHORITY LAW

THIS CONTRACT IMPLEMENTING FUNDING PROVISIONS OF THE NEW JERSEY HEALTH CARE FACILITIES FINANCING AUTHORITY LAW (the “Agreement’) is made as of June 18, 2009, by and between the Treasurer of the State of New Jersey (the “Treasurer”) and the New Jersey Health Care Facilities Financing Authority (the “Authority”), a public body corporate and politic of the State of New Jersey (the “State”) created and existing pursuant to the New Jersey Health Care Facilities Financing Authority Law, P.L. 1972, c.29, N.J.S.A. 26:2I-1 et seq., as heretofore or hereafter from time to time amended and supplemented (the “Act”).

BACKGROUND

WHEREAS, pursuant to the provisions of the Act, the Hospital Asset Transformation Program was created to provide financial assistance by the Authority to nonprofit hospitals in the State in connection with the termination of the provision of hospital acute care services at a specific location or locations that may no longer be necessary or useful for this purpose (the “Hospital Asset Transformation Program”); and

WHEREAS, the Authority is authorized, subject to the approval of the State Treasurer and pursuant to subsection g of Section 7 of the Act, to issue bonds and refunding bonds secured, in whole or in part, by moneys received pursuant to subsection a. of section 6 of P.L. 2000, c. 98 (C.26:2I-7.1), in order to provide, in connection with the Hospital Asset Transformation Program, any nonprofit health care organization in the State with the funds to satisfy the outstanding bonded indebtedness or any other outstanding indebtedness of any hospital in the State; pay the costs of transitioning a general hospital to a nonprofit, non-acute care health care-related facility, including, but not limited to, construction, renovation, equipment, information technology and working capital; pay the costs related to transitioning acute care and related services from the hospital at which inpatient acute care services are to be terminated to an existing nonprofit general hospital, including, but not limited to, construction, renovation, equipment, information technology and working capital; pay the costs associated with the closure of a general hospital; pay the costs of the acquisition of a general hospital in the State for the purpose of either (i) moving an existing general hospital’s services into the acquired hospital and closing the acquirer’s inpatient acute care services, or (ii) closing its inpatient acute care services; pay capitalized interest; fund a debt service reserve fund; pay the costs associated with the issuance of any bonds for any of the aforementioned purposes; or pay other costs specifically related to the closure or transition of inpatient acute care services as identified in the contract with the Treasurer; and

WHEREAS, The Community Hospital Group, Inc., t/a JFK Medical Center, Hartwyck at Oak Tree, Inc. and Muhlenberg Regional Medical Center, Inc. (each a “Borrower” and, collectively, the

“Borrowers”) have determined to undertake (1) various capital improvements to the JFK Medical Center Facilities, including, but not limited to, expansion of inpatient bed capacity and unit renovations, emergency room expansion, operating room renovations and expansion, and other necessary expansions, renovations and improvements, (2) the payment of capitalized interest on a portion of the Series 2009 A Bonds and (3) the refinancing of various series of bonds issued on behalf of, and other indebtedness of, JFK Medical Center, Hartwyck at Oak Tree and Muhlenberg Regional Medical Center, all in connection with the termination of the provision of hospital acute care services at the Muhlenberg Regional Medical Center Hospital Facilities and pursuant to the State’s Hospital Asset Transformation Program (the “2009 Project”).

WHEREAS, the Borrowers have applied to the Authority for financial assistance to finance a portion of the costs of the 2009 Project; and

WHEREAS, pursuant to the Act and the Authority’s Hospital Asset Transformation Program State Contract Bond Resolution (JFK Medical Center Obligated Group Issue), adopted by the Authority on October 23, 2008, as the same may be amended and supplemented from time to time (the

“Resolution”), the Authority has determined to issue its $152,925,000 State Contract Bonds (Hospital Asset Transformation Program) Series 2009 A (the “Series 2009 A Bonds”) and, together with any Refunding Bonds issued under the Resolution, the “Bonds”) to (i) provide funds to the Borrowers to pay a portion of the costs of the 2009 Project and (ii) pay the costs of issuing the Series 2009 A State Contract Bonds (collectively, the “Project”); and

WHEREAS, pursuant to the Act and in order to provide for the payment of debt service on the Bonds issued pursuant to the Resolution, the Authority is authorized to enter into a Contract with the State Treasurer providing for the payment, subject to available legislative appropriations from time to time, of the debt service on such Bonds.

NOW, THEREFORE, in consideration of the mutual covenants, undertakings and agreements set forth herein and intending to be legally bound, the Authority and the Treasurer hereby covenant and agree as follows:

ARTICLE I DEFINITIONS 1.1 Definitions.

Capitalized terms used but not defined in this Agreement shall have the meanings given to them in the Resolution or the Act, unless a different meaning clearly appears from the context. In addition, the following terms shall have the meanings set forth below.

Act shall mean the New Jersey Health Care Facilities Financing Authority Law Act, P.L. 1972, c.

29 as heretofore or hereafter from time to time amended and supplemented.

Administrative Expenses-Initial shall mean any Administrative Expenses–Ordinary to be paid at the closing for a Series from the proceeds of such Series.

Administrative Expenses–Ordinary shall mean ordinary costs, liabilities and expenses incurred by the Authority to undertake the Project, including, but not limited to, the fees and expenses of the Trustee, accounting and other usual administrative costs, in an amount pursuant to the budget prepared by the Authority and approved by the Treasurer; provided however that Administrative Expenses – Ordinary shall not include the Annual Administrative Fee which shall be paid by the Borrowers under the Loan Agreement..

Authority shall mean the New Jersey Health Care Facilities Financing Authority, a public body corporate and politic constituting an instrumentality of the State, created and existing under and by virtue of the Act, exercising governmental functions, and any body, board, authority, agency or political subdivision or other instrumentality of the State which shall hereafter succeed to the powers, duties and functions thereof.

Bond or Bonds shall mean any bonds, including Refunding Bonds, authorized to be issued pursuant to subsection g of Section 7 of the Act (N.J.S.A. 26:2I-7(g)) and authenticated and delivered under and pursuant to the Resolution.

Bondholder or Holder of Bonds or Holder shall mean any person who shall be the registered owner of any Bond or Bonds. A Financing Facility Provider which owns Bonds by purchase or is subrogated to the rights of Bondholders is a Bondholder for purposes hereof.

Bond Payment Obligations shall mean the Authority’s obligation to pay the principal or Redemption Price of and interest on the Bonds, including Bonds held by Financing Facility Providers.

Borrower shall have the meaning set forth in the preamble hereto.

Borrowers shall have the meaning set forth in the preamble hereto.

Debt Service Fund shall mean any Debt Service Fund established in Section 502 of the Resolution.

Debt Service Requirements shall mean, with respect to a Payment Date, all Bond Payment Obligations and Financing Facility Payment Obligations coming due and payable on such Payment Date.

Financing Facility shall mean any revolving credit agreement, agreement establishing a line of credit or letter of credit, reimbursement agreement, interest rate exchange agreement, currency exchange agreement, interest rate floor or cap, options, puts or calls to hedge payment, currency, rate, spread or similar exposure or similar agreements, float agreements, forward agreements, insurance contracts, surety bonds, commitments to purchase or sell bonds, purchase or sale agreements, or commitments or other contracts or agreements and other security agreements, including Swaps, approved by an Authorized Officer of the Authority and the Treasurer in connection with the Bonds.

Financing Facility Payment Obligations shall mean all payment and reimbursement obligations of the Authority to a Financing Facility Provider in connection with any Financing Facility securing or entered into in connection with all or a portion of any Series of Bonds, and which do not constitute Bond Payment Obligations.

Financing Facility Provider shall mean the issuer or provider of a Financing Facility.

First Supplemental Indenture shall mean the First Supplemental Indenture dated as of June 1, 2009, by and between JFK Medical Center, on behalf of itself and the other Members of the Obligated Group, and the Master Trustee.

General Fund shall mean the General Fund of the State.

Loan Agreement shall mean the Loan Agreement dated as of June 1, 2009 between the Authority and the Borrowers, relating to the Bonds, as the same may be amended and supplemented from time to time.

Master Indenture shall mean the Master Trust Indenture dated as of June 1, 2009, by and between JFK Medical Center, on behalf of itself and the other Members of the Obligated Group, and the Master Trustee, as supplemented or amended from time to time, including, without limitation, the First Supplemental Indenture.

Master Trustee shall mean The Bank of New York Mellon, Woodland Park, New Jersey, as Master Trustee.

Obligated Group shall mean all Obligated Issuers (as defined in the Master Indenture).

Payment Date shall mean each Interest Payment Date and each date upon which any principal or Redemption Price of any Bonds Outstanding or any payment of a Financing Facility Payment Obligation shall become due and payable.

Project shall have the meaning set forth in the preamble hereto.

Project Fund shall mean any Project Fund established in Section 502 of the Resolution.

Rebate Fund shall mean the Rebate Fund established in Section 502 of the Resolution.

Redemption Price shall mean, with respect to any Bond, the principal amount thereof plus the applicable premium, if any, payable upon redemption thereof pursuant to such Bond or the Resolution.

Refunding Bonds shall mean all Bonds, whether issued in one or more Series, authenticated and delivered on original issuance pursuant to Section 203 of the Resolution, and any Bonds thereafter

authenticated and delivered in lieu of or in substitution for such Bonds pursuant to Article III or Section 406 or Section 1106 of the Resolution.

Resolution shall mean the Authority’s Hospital Asset Transformation Program State Contract Bond Resolution (JFK Medical Center Obligated Issue) as from time to time amended or supplemented by Supplemental Resolutions and Series Certificates in accordance with its terms and any resolution, indenture, agreement, or other instrument adopted or entered into by the Authority which provides for the security and payment of the Bonds.

Revenue Fund shall mean the Revenue Fund established in Section 502 of the Resolution.

Series shall mean all of the Bonds authenticated and delivered on original issuance and identified pursuant to the Supplemental Resolution authorizing such Bonds as a separate Series of Bonds, and any Bonds thereafter authenticated and delivered in lieu of or in substitution for such Bonds pursuant to Article III or Section 406 or Section 1106 of the Resolution, regardless of variations in maturity, interest rate, redemption provisions or other provisions.

Series Certificate shall mean a certificate executed by an Authorized Officer of the Authority making certain determinations in connection with the issuance of a Series of Bonds providing for, among other items, the issuance of such Series of Bonds. Each Series Certificate, upon execution and delivery, shall be deemed to be a part of the Resolution.

Series 2009 A Bonds shall mean the $152,925,000 initial aggregate principal amount of the Authority’s State Contract Bonds (Hospital Asset Transformation Program), Series 2009 A.

Series 2009 A State Contract Bonds shall mean the Series 2009 A Bonds.

State shall mean the State of New Jersey.

State Contract shall mean this Agreement.

State Fiscal Year shall mean the fiscal year of the State, being the twelve (12) month period beginning on July 1 of each year and ending on June 30 of the succeeding year.

Supplemental Resolution shall mean any resolution supplemental to or amendatory of the Resolution adopted by the Authority in accordance with Article X of the Resolution.

Swap or Swap Agreement shall mean any agreement between the Authority and a Swap Provider confirming a transaction which is a rate swap transaction, basis swap, forward rate transaction, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, corridor transaction, currency swap transaction, cross-currency rate swap transaction;

currency option or any other similar transaction (including any option with respect to any of the foregoing transactions) or any combination of such transactions, approved by an Authorized Officer of the Authority and the Treasurer in connection with the Bonds.

Swap Provider shall mean the Authority’s or the Trustee’s counterparty under a Swap Agreement.

Treasurer shall mean the Treasurer of the State of New Jersey.

Trustee shall mean the Trustee appointed pursuant to the Resolution.

2009 Project shall have the meaning set forth in the preamble hereto.

ARTICLE II

FUNDS AND ACCOUNTS; PAYMENTS