Methodist Hospital Group

“John Bookout III-Director of Houston Methodist Research Insitutue- is son of John Bookout, also Director of the same entity.”

“-The Methodist Hospital, doing business as Houston Methodist Hospital is the sole corporate member of The Methodist Hospital Research Institute, doing business as Houston Methodist Research Institute and TMH Health Care Group. -The Methodist Hospital Foundation, doing business as Houston Methodist Foundation, is the sole corporate member of TMH Medical Office Buildings. -TMH Health Care Group is the sole corporate member of Diagnostic Center Hospital Corp. of Texas, Methodist Health Centers, and San Jacinto Methodist Hospital, doing business as Houston Methodist San Jacinto Hospital. -TMH Physician Organization, doing business as Houston Methodist Specialty Physician Group is the sole corporate member of Methodist Pathology Associates, PLLC, Methodist Radiology Associates PLLC, TMH Physician Associates, PLLC, and TMH Physicians and Surgeons, PLLC.”

“TMH Health Care Group is the Parent and sole corporate member of Methodist Health Centers, Houston Methodist San Jacinto Hospital, and Diagnostic Center Hospital Corp. of Texas; Houston Methodist Specialty Physician Group is the sole corporate member of Methodist Pathology Associates, PLLC, Methodist Radiology Associates, PLLC, TMH Physician Associates, PLLC, and TMH Physician and Surgeons, PLLC; Houston Methodist Hospital Foundation is the sole corporate memeber of TMH Medical Office Buildings; Houston Methodist Hospital is the sole corporate member of the TMH Health Care Group, and Houston Methodist Research Institute (collectively "Subsidiary" or "Subsidiaries"). Houston Methodist Hospital has the authority to appoint the subidiary organizations' Boards of Directors.”

“Houston Methodist Hospital which is the sole corporate member of the Subsidiaries and group organizations (the "organization") reserves the following powers: -to appoint and remove with or without cause the Directors of the organizations; -to approve the incurrence by the organizations of any indebtedness and all guarantees of the debt of another party; -to approve the annual operating and capital budgets of the organizations after they are prepared and approved by the organizations' Boards of Directors; -to approve the dissolution of organizations; -to approve the organizations' participation in partnerships and joint ventures; -to approve the acquisition or disposition by the organizations of real property from or to a non-Corporation controlled organization through ownership, lease or otherwise; -to approve the disposition or acquisition by the organizations of or the investment by the organization in, another business or all or a portion of the business or operations of another business; -to establish, acquire or invest in any new or different business; and -to direct the organizations in its actions as the corporate member or shareholder of other entities, including but not limited to, approving amendments to the articles of incorporation and bylaws of such other organizations.”

“Management, including certain Officers, works diligently to complete the Form 990 and attached schedules (Return) in a thorough manner. The Return is prepared by a Paid Preparer. Prior to filing the return, a copy of the Form 990 is made available to Board members (including required schedules) and management team members are available to answer any Board members' questions.”

“All individuals serving in a significant decision making capacity complete a Conflict of Interest (COI) questionnaire annually. A comprehensive evaluation and thorough review of all disclosures is performed by a 6-member COI Committee comprised of executives, management, and staff. The results of the COI disclosures are reported to the parent corporation's Audit & Compliance Committees and Boards of Directors, including the actions being taken to protect the integrity of decision-making. In addition, disclosure results are also communicated to management and to affected committee chairs to promote transparency and to ensure that actions are taken and restrictions are imposed where appropriate. Conflicted individuals may not vote or exert self-serving influence on the disclosed matter.”

“Houston Methodist Hospital (HMH) (sole corporate member of the Subsidiaries) follows IRS regulations as it relates to establishing a rebuttable presumption of reasonableness related to total compensation of the CEO of the organizations as well as other key employees and compensated officers of the organizations listed below. It has established a process that includes the following elements: A separate committee (the Board Committee) comprised of independent directors meets at least annually to review, deliberate and make recommendations to Houston Methodist Hospital Board of Directors as it relates to any changes in total compensation including base pay, bonus awards from incentive programs or benefits and perquisites of the CEO. For 2013, the Board Committee reviewed and recommended compensation packages for the following positions: -President/CEO, Houston Methodist who serves as Director, Officer; Director and Officer - President and Chief Executive Officer for Methodist Health Centers; Director for the Houston Methodist Research Institute; Director & Officer-Chairperson for Houston Methodist San Jacinto Hospital; Director and Officer - President/CEO for TMH Health Care Group; Director and Officer-Chairperson for TMH Medical Office Buildings (MOB); and Director & Officer-Chairperson for Diagnostic Center Hospital Corporation of Texas(DCH) -EVP, Chief Financial Officer/Chief Business Officer, Houston Methodist Hospital, Officer-Assistant Secretary (Houston Methodist Research Institute), Officer-Assistant Secretary (Methodist Health Centers), Officer-Assistant Secretary (Houston Methodist San Jacinto Hospital), Officer-Secretary for TMH Health Care Group, Director and Officer, Vice Chairperson, Secretary and Treasurer (Diagnostic Center Hospital), and Director and Officer, Secretary & Treasurer (TMH Medical Office Buildings) -EVP, Chief Legal Officer -SVP, Human Resources -SVP and CEO of Houston Methodist San Jacinto Hospital who serves as Director & Officer-President, CEO and Treasurer of Houston Methodist San Jacinto Hospital -President/CEO, Houston Methodist Research Institute who also serves as Director -SVP and CEO, Houston Methodist Sugar Land Hospital who also serves as a Director -SVP and CEO, Houston Methodist Willowbrook Hospital who also serves as a Director -SVP and CEO, Houston Methodist West Houston Hospital who also serves as a Director The Board Committee establishes that no member has any conflict of interest with regard to the executive compensation arrangements being approved. The Board Committee reviews and considers information provided by an external consultant engaged to ensure it has direct access to: -Compensation information paid by comparable organizations, for functionally comparable positions. -Compensation norms in the organization's immediate locale and from other independent compensation surveys by nationally recognized independent firms that represent the organization's logical peer group. -Compensation information that includes information on base salary, incentives, benefits and perquisites for total compensation comparison purposes to ensure reasonable competitive ranking. The Board Committee relies on the comparability data to reach consensus that its recommendations to the Board regarding executive compensation changes are reasonable and in line with the organization's overall total compensation philosophy for executive pay. The deliberations and decisions of the committee are contemporaneously substantiated. The compensation for positions held by the other compensated Officers, Directors and Key Employees listed on Part VII, Section A is determined based on a thorough review of numerous compensation studies conducted by nationally recognized, independent firms that provide market data for total compensation for similar positions. The compensation information considered includes information on base salary, incentives, and benefits for total compensation purposes to ensure reasonable compet”

“The governing documents (except the Articles of Incorporation, which are on file with the Secretary of the State of Texas), conflict of interest policy and financial statements of the organizations are not made available to the general public.”

“The following list of Officers, Directors, Trustees, Key Employees and Highest Compensated Employees provides entity level details to support the information reported in Part VII since many of the Group's reportable individuals serve more than one entity included in this Group return. In addition, pursuant to Treasury Regulation Section 1 6033-2(D)(5), Houston Methodist Hospital, which is the Central Organization of the Group, elected to report information about its current and former officers, directors, trustees, and key employees, and current highest compensated employees in this Group return.”

“Methodist Research Institute and held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director & Officer, President & Chief Executive Officer (average hours per week of 50). Noel R. Rainey received all of his Part VII compensation from Houston Methodist Hospital and held the following positions with the Central Organization and/or entities included in this Group return: TMH Medical Office Buildings - Director & Officer, President & Chief Executive Officer (average hours per week of 50). Ann Scanlon McGinity received all of her Part VII compensation from Houston Methodist Hospital and held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital- Key Employee, Senior Vice President & Chief Nursing Executive (average hours per week of 50). Bruce Kennedy, M.D. received all of his Part VII compensation from Houston Methodist San Jacinto Hospital and held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist San Jacinto Hospital - Key Employee, Vice President & Chief Medical Officer (average hours per week of 40). Edward A. Jones received all of his Part VII compensation from Houston Methodist Research Institute and held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Key Employee, Vice President of Administration (average hours per week of 50). Janet Leatherwood received all of her Part VII compensation from Methodist Health Centers and held the following position with the Central Organization and/or entities included in this Group return: Methodist Health Centers - Key Employee, Vice President & Chief Nursing Officer, Houston Methodist Sugar Land Hospital (average hours per week of 50). Jonathan Sturgis received all of his Part VII compensation from Houston Methodist San Jacinto Hospital and held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist San Jacinto Hospital - Key Employee, Vice President & Chief Financial Officer (average hours per week of 50). Keith Barber received all of his Part VII compensation from Methodist Health Centers and held the following position with the Central Organization and/or entities included in this Group return: Methodist Health Centers - Key Employee, Vice President & Chief Financial Officer of Houston Methodist Willowbrook Hospital (average hours per week of 50). Lowell Stanton received all of his Part VII compensation from Methodist Health Centers and held the following position with the Central Organization and/or entities included in this Group return: Methodist Health Centers - Key Employee, Vice President & Chief Financial Officer of Houston Methodist Sugar Land Hospital (average hours per week of 50). Ramon Cantu received all of his Part VII compensation from Houston Methodist Hospital and held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital- Key Employee, Executive Vice President, Chief Legal Officer & Business and Strategic Development Officer (average hours per week of 50) TMH Medical Office Buildings Former, Director & Officer, Secretary/Treasurer, Diagnostic Center Hospital Former, Director & Officer, Vice Chairperson, Secretary/Treasurer, Houston Methodist San Jacinto Hospital Former, Officer, Assistant Secretary, Methodist Health Centers Former, Officer, Assistant Secretary, Houston Methodist Research Institute Former, Officer, Assistant Secretary, TMH Health Care Group Former, Officer, Secretary. Robert A. Phillips, M. D., Ph.D. received all of his Part VII compensation from Houston Methodist Hospital and held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist”

“Certain officers/directors of the organizations of the Methodist Hospital Group (Group) are employees of Houston Methodist Hospital, Houston Specialty Physician Group (a subordinate organization within the Group but filing a separate return), Houston Methodist Hospital Foundation (a subordinate organization within the Group but filing a separate return) or its non-Group affiliates (related organizations). The officers and directors who are employed by these related organizations work a total of 50 hours per week on behalf of these organizations and other organizations of Houston Methodist. The compensation shown on Part VII and Schedule J reflects the total compensation earned for the officer/director for the combined hours spent working for all the organizations in the System.”

“Houston Methodist Hospital, EIN 74-1180155 has elected to report certain professional contractors and certain other contractors on a consolidated basis for all of the members of the group, including the parent organization, on this Methodist Hospital Group "Group" return. This election is based upon Treasury Reg Section 1 6033-2(D)(5). As as result Methodist Hospital's two highest paid contractors are consolidated with the entities within the Group to represent the five highest paid contractors of the Group.”

“Affiliated Organizations Not Included In Group Return (total of 2 entities): (1) Houston Methodist Specialty Physician Group, EIN 57-1201170, 6565 Fannin, Houston, TX 77030 (2) Methodist Hospital Foundation (dba Houston Methodist Hospital Foundation), EIN 76-0094743, 6565 Fannin, Houston, TX 77030.”

“The organizations in Methodist Hospital Group (Group) (See Statement 2) are part of The Methodist Hospital, doing business as Houston Methodist Hospital, whose mission is: To provide high quality, cost-effective health care that delivers the best value to the people we serve in a spiritual environment of caring in association with internationally recognized teaching and research.”

“The entities in the Methodist Hospital Group (see Statement 1) included in this return perform different actitives. The program service accomplishments for the activities are described below. 1. Methodist Health Centers does business as Houston Methodist Sugar Land Hospital (HMSL), Houston Methodist Willowbrook Hospital (HMWB), and Houston Methodist West Hospital (HMW). 1a. HMSL is located in Sugar Land, Texas, which is approximately 21 miles southwest of downtown Houston, Texas. As of December 31, 2013, HMSL's operating bed capacity was 243. Principal medical services provided by HMSL include Inpatient and Outpatient Medical and Surgical Care, Intensive Care, 18 Surgery Suites, one Bronchoscopy Suite, two Endoscopy Suites, a Radiation Therapy Center, three Cardiac Catheterization Labs, a 24-Hour Emergency Care Center, a Birthing and Women's Center, a comprehensive Breast Center, a complete Outpatient Physical Therapy Rehabilitation Center and State of the Art Imaging Services, including MRI, CT, and Nuclear Medicine. HMSL recorded 178,306 visits during 2013 which were comprised of 125,451 Outpatient visits, 39,292 Emergency Visits, and 13,563 Inpatient Admissions. 1b. HMWB is located in the northwest area of Harris County, approximately 25 miles northwest of downtown Houston, Texas. As of December 31, 2013, HMWB's operating bed capacity was 241. Principal medical services provided by HMWB include Inpatient and Outpatient Medical and Surgical Care, Surgery Suites, Endoscopy Suites, a Cardiac Catheterization Lab, a 24-Hour Emergency Care Center, a Birthing Center with a Level II Nursery, an Intensive Care Unit, General and Diagnostic Radiology, Nuclear Medicine, Laboratory and Physical Therapy. HMWB recorded 79,271 Outpatient visits, 14,471 Admissions and 56,527 Emergency Room visits for a total of 150,269 visits in 2013. 1c. HMW is located in the western part of Harris County, approximately 21 mile west of downtown Houston, Texas. On December 17, 2010, HMW opened its emergency center, operating rooms, ICU, surgery center and all ancillary support services. The hospital has opened additional specialty & outpatient areas such as a cancer center, birthing center, cath lab, breast center, cardiac imaging and physical therapy in addition to a cardiovascular program. During 2013 HMW recorded 85,910 visits which were comprised of 50,075 Outpatient patient visits, 27,497 Emergency Room visits and 8,338 Inpatient Adult Admissions. Currently, HMW has 161 licensed operating beds. The campus master plan includes expansion space to take the inpatient capacity to 400 beds, and to allow four professional buildings and two parking garages. 2. San Jacinto Methodist Hospital provides hospital services out of two locations in Baytown, Texas, which is approximately 30 miles east of downtown Houston, Texas. Two sites have adjacent professional office buildings that lease office space to physicians who practice within the hospitals and house hospital functions. As of December 31, 2013, Houston Methodist San Jacinto Hospital had 275 hospital beds in operation. Principal medical services provided include women's health, obstetrics, cancer center, urology, orthopedics, diabetes education, cardiovascular lab, rehabilitation, intensive care medical and surgical services and emergency care. A full service psychiatric program is included, as well as a skilled nursing facility. Houston Methodist San Jacinto Hospital operates the only hospital emergency room in Baytown and served its community in 2013 by providing 12,360 Inpatient Admissions, 50,585 Emergency Room visits, and 60,042 Outpatient visits for a total of 122,987 visits. 3. TMH Medical Office Buildings is operated to support The Methodist Hospital, doing business as Houston Methodist Hospital, Houston Methodist Willowbrook Hospital, Houston Methodist San Jacinto Hospital, Houston Methodist Sugar Land Hospital, and Houston Methodist West Hospital. The TMH Medical Office Buildings also operates offi”

“The goal of the transplant immunology program is to develop highly effective therapeutic protocols for supporting transplant survival without life-long immunosuppression and to eliminate complications from rejection of grafts in transplant patients. Xian C. Li, M.D., Ph.D., joined the Institute in 2013 as Scientific Director, Center for Immunobiology and Director, Transplant Immunology Program. 2013 also saw the addition of 4 other faculty members: Wenhao Chen, Ph.D., Roger Sciammas, Ph.D., Zhiqiang Zhang, Ph.D., and Xiang Xiao, Ph.D. to the program. With $1.5 million in total funding for 2013 (NIH grants of $877,000, Other grants of $147,000, and Clinical trials of $484,000), this program has produced 39 publications and conference activities for the year. The Houston Methodist Research Institute established the Cockrell Clinical Trials Centers to support clinical trials, especially the transition from preclinical to phase 1 & 2 studies. Kapil N. Bhalla, M.D., Phase I Program Director, was recruited to establish the Phase I unit of the Cockrell Centers. Cockrell Centers-Phase I unit initiated their first study on December 19, 2013. Currently there are 7 active and 8 upcoming trials at the Cockrell Center in the Texas Medical Center location, with ongoing expansion to other community areas. The Cockrell Center at the Sugar Land network hospital successfully opened its doors and is actively promoting clinical trials in the Sugar Land community. The West Houston site is supporting clinical trials and is also working towards opening a new office in 2014. Both facilities have part-time nursing staff to support the studies. The Pearland facility was newly formed in 2013 and work is currently underway to integrate the new facility, resources, and studies. Several staff members have been hired to support the centers. Jenny Chang, M.D., Director, Houston Methodist Cancer Center, was the Principal Investigator for the first clinical trial at the Cockrell Centers that studied 'Super Herceptin' therapy for breast cancer. Herceptin (Trastuzumab) is an approved adjuvant therapy for HER2+ early-stage breast cancer, metastatic breast cancer, and gastric cancer. It works by interfering with the HER2 receptor that promotes cell growth. In certain cancers, function of this receptor is amplified, leading to uncontrolled cell growth. Blocking its function with Herceptin therapy can be effective in combination with chemotherapy and/or radiation. Dr. Chang's team has developed 'super Herceptin' known as T-DM1. By combining Herceptin directly with docetaxel (standard chemotherapy) and/or pertuzumab, T-DMI is designed to attack the tumor cells directly and deliver the chemotherapy. Dr. Chang's trial was conducted in partnership with Genentech & ImmunoGen. In 2013, HMH was also activated as a site for the expanded access study. The Houston Methodist Research Institute has also made huge strides in the development of technology platforms that have applications across all service lines of the hospital. For two platforms, collaborations have already been established to evaluate heart, neurology, transplant, and cancer-related clinical applications. The two platforms are: -Microfluidic devices: Human blood is filled with protein biomarkers. Rapid assay systems can detect the presence or levels of these biomarkers in a blood sample - in many cases providing almost immediate diagnostic information. Most rapid assay systems, however, require pumps, power supplies, and fluid handling systems, limiting their portability and utility. Lidong Qin Ph.D. from the Department of Nanomedicine and his colleagues have developed a tiny, self-powered chip called the V-chip that uses the energy output from a chemical reaction to separate blood into plasma and cells, then rapidly determines the presence and levels of numerous diagnostic proteins in the plasma. The physician or lab technician only needs to place a tiny blood sample on the chip, then press a button on the sur”

“with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Allen Becker is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Antonio Gotto, M.D., D. Phil, ex officio is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Bishop Janice Riggle Huie is an uncompensated director. She held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director (average hours per week of 2). C. Richard Stasney, M.D. is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Carlton E. Baucum is an uncompensated director. He held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital Director & Officer, Treasurer (average hours per week of 2), TMH Health Care Group - Director (average hours per week of 1). Catherine S. Jodeit is an uncompensated director. She held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute Director (average hours per week of 1). Connie Dyer is an uncompensated director. She held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital- Director (average hours per week of 2), Methodist Health Centers - Director & Officer, Vice Chairperson (average hours per week of 2). David M. Underwood is an uncompensated director. He held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director & Officer, Vice Chairperson (average hours per week of 3), TMH Health Care Group - Director (average hours per week of 1). Dr. Steve P. Wende is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director (average hours per week of 2). Dr. Tom Pace, III is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director (average hours per week of 2). Edward R. "Eddie" Allen, III is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Elizabeth Blanton Wareing is an uncompensated director. She held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director (average hours per week of 1). Emily A. Crosswell is an uncompensated director. She held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital- Director (average hours per week of 1), Methodist Health Centers - Director & Officer, Chairperson (average hours per week of 2). Eric J. Haufrect, M. D. is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director (average hours per week of 2). Ernest D. Cockrell, II is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hou”

“position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Leo Linbeck, III is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Mark A. Houser is an uncompensated director. He held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital- Director (average hours per week of 1), Houston Methodist Research Institute Director (average hours per week of 1). Mary A. Daffin is an uncompensated director. She held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital- Director (average hours per week of 2), Houston Methodist Research Institute - Director (average hours per week of 1). Morrie K. Abramson is an uncompensated director. He held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital- Director (average hours per week of 2), Houston Methodist Research Institute - Director (average hours per week of 1). Pete Alfaro is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: San Jacinto Methodist Hospital Director & Officer, Vice Chairperson (average hours per week of 1). Renu Khator, Ph.D. is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Rev. Kenneth R. Levingston is an uncompensated director. He held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director (average hours per week of 1), Methodist Health Centers - Director (average hours per week of 1). Richard A. Peebles is an uncompensated director. He held the following positions with the Central Organization and/or entities included in this Group return: San Jacinto Methodist Hospital - Director & Officer, Secretary (average hours per week of 5). Robert K. Moses, Jr. is an uncompensated director. He held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital- Director & Officer, Assistant Secretary (average hours per week of 1), Methodist Health Centers - Director (average hours per week of 1), TMH Health Care Group - Director & Officer, Vice Chairperson (average hours per week of 1). Sandra Gayle Wright, R.N., Ed.D. is an uncompensated director. She held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director (average hours per week of 1). Stephen D. Arnold is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Stuart W. Stedman is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Houston Methodist Research Institute - Director (average hours per week of 1). Vidal G. Martinez is an uncompensated director. He held the following positions with the Central Organization and/or entities included in this Group return: Houston Methodist Hospital - Director (average hours per week of 2). William F. Schwer is an uncompensated director. He held the following position with the Central Organization and/or entities included in this Group return: Methodist Health Centers - Director (average hours per week of 1). Beryl O. Ramsey received all of her Part VII compensation from Methodist Healt”

“Change in Health Care Group 73,484,557. The Methodist Hospital Research Institute Use of Grant Fund - Equipment 97,301. Transfer from The Methodist Hospital-Service Organ. of Greater Houston -7,977,032. San Jacinto Medical Group Return Investment -45,775,108. Rounding 4.”

“Diagnostic Center Hospital (DCH) of the Methodist Hospital Group does not follow SFAS 117. Due to software limitations, the section could not be presented properly and therefore Diagnostic Center Hospital's amount of Retained Earnings and Common Stock are included on line 27 instead of line lines 30 and 32. Line 30 - Capital Stock or trust principal, etc. - $37,482,581 Line 32 - Retained earnings, endowment, etc. - $13,282,950”

“The A-133 Audit referred to on lines 3a & 3b was obtained by Houston Methodist Research Institute.”