Keystone Human Services

“Charles hooker's son is employed by keystone human services and is listed on schedule l. Tom flowers, board member, is also a board member of centric bank. Don enders, board member, is also a board member of centric bank.”

“Keystone human services is a "member" for all entities.”

“The keystone human services board appoints and/or approves all board members for all entities”

“REORGANIZATIONS”

“The khs board has governance responsibility for the engagement of independent auditors and acceptance of the audit report for khs and all subsidiaries. The keystone human services audit committee is established to provide management of the audit process and the organization's system of internal controls. Internal control is comprised of all policies and procedures designed to assure the integrity of financial and operational accountabilitiy. Financial accountability is comprised of policies and procedures relating to the financial management functions designed to asssure that financial transactions which flow from the services provided are executed and reported in compliance with all applicable regulations. This includes that accounting records and related financial reports are accurate representations of the executed transactions. In accordance with the foregoing responsibility of the khs audit committee and in compliance with the new form 990 governance implicit recommendation, the form 990 of each khs entities will be reviewed prior to filing. Salary note regarding president and officers: benefits include accrued expense pursuant to irs 457b and 457f deferred compensation retirement plans. Executive compensation is allocated to specific program areas pursuant to regulatory and/or contract caps on participation in executive compensation.”

“Policy: it is the policy of khs and all of its subsidiaries that no director or officer shall profit financially or appear to profit financially (beyond approved compensation) as a result of their association with khs. It is khs's intent to engage in financial transactions with directors and officers only when it is clearly within the best interests of khs to do so or when the transactions are both non-material and non-adverse to khs. Procedures: service with competing organizations: in order to protect khs from the risk of unfair competition or anti-trust liabilities, paid directors and officers shall not serve as directors of competing organizations that do business or regularly submit competitive proposals in areas where khs is active. If a volunteer director or officer serves as a director of a competing organization, that role shall be disclosed to the vice president of corporate compliance and the board of directors of each of the organizations and that director or officer shall abstain from discussions and voting on issues applicable to both organizations. Confidential information: directors and officers may have access to confidential information about persons served and employees. Directors and officers shall not divulge any such information to unauthorized persons and shall not publish, discuss, or otherwise make public or disclose any such confidential information. Proprietary information: information not otherwise made public but disclosed to directors and officers about khs's particular processes, services, proposals, operations, methodologies, plans, policies, and programs is proprietary, privileged and/or confidential. Except as required by their duties, and is authorized by the corporate president and/or chief executive officer, no current or past directors or officers may directly or indirectly use, disseminate, disclose, lecture upon, or publish information concerning any such privileged, proprietary and/or confidential information or knowledge. In the event a director or officer does not follow the procedures as outlined above there may be termination of the appointment to the board or of employement. Disclosure: directors and officers shall timely disclose in writing to the vice president of corporate compliance, all circumstances that constitute an actual, potential or perceived conflict of interest. In addition, the compliance department will circulate the annual disclosure statement. All board members, directors and officers must complete the statement upon affiliation with the organziation and annually thereafter. Disclosure statements shall be completed annually and forwarded to the corporate compliance department.”

“This policy establishes the intention of keystone human services (khs) to provide reasonable remuneration to the khs president and designated officers in their leadership roles for a large, comprehensive non-profit corporation providing human services. Policy: it is the policy of khs to use a compensation system for the khs president and officers that will determine the current market value of a position based on the skills, knowledge and behaviors required of a fully competent incumbent. The system used will be affordable, objective and non-discriminatory in theory, application and practice and be in compliance with federal irs "intermediate sanctions" regulations. Procedures: khs will use a professional compensation consultant and system recommended by executive management and approved by the compensation committee of the board of the directors. The committee, operating in their fiduciary capacity, will balance executive performance, market data, and affordability into any decision involving executive remuneration. Total compensation analysis: competitiveness of the president and officer's total remunerations (all elements of compensation and benefits) is compared to the market median for both base salary and total cash compensation when compared to similar executive roles. The analysis process includes position pricing by title match and job size. The above market approach results will be blended to develop a market reference that reflects components of both complexity of the positions and the title/organizational size. Responsibilities: on a periodic basis the compensation committee of the board of directors will review and approve, as appropriate, recommended changes in remuneration based on market analysis, executive performance and organization affordability. As part of the process, the compensation committee of the board of directors will review and approve, as applicable, total compensation range, which would include base salary, total cash, deferred compensation, benefit plans and prerequisites. The board shall set the position level, salary and benefit components of the total compensation package of the president the president shall set the position level, salary and benefits components of the total compensation package of officers designated by the board of directors in the event funding is reduced, not available, contracts are lost or a compensation survey indicated the individual is receiving salary and benefits that exceed market level, the salary and benefits may be frozen or reduced. Executive salary and benefits will be allocated and charged to appropriate cost centers at a level that is consistent with all regulatory and contractual obligations and applicable cost allocation plans. Officers: officers are executive positions identified and approved by the khs board of directors. Board compensation committee: a committee consisting of board members who are not employees of keystone human services and not classified as disqualified persons pursuant to internal revenue service regulations.”

“The company mission statement is widely publicized and readily available; however, other governing documents including the conflict of interest policy are not. The internal revenue form 990 is available upon request.”

“Change in controlling interest in the net assets of affiliates 7,271,099.”

“The process has not changed from prior years.”