Carilion Clinic Foundation

“1. Nancy Howell Agee and Abney S. Boxley, III - Business relationship due to each serving on the Board of the same unrelated company. 2. Nancy Howell Agee, George B. Cartledge, Jr., and Warner Dalhouse - Business relationship due to each serving on the Board of the same unrelated company. 3. Robert Bennett and George B. Cartledge, Jr. - Business relationship due to each serving on the Board of the same unrelated company. 4. Nancy Howell Agee, Briggs W. Andrews, Lauren J. Chen, Donald B. Halliwill, Shirley L. Holland, G. Robert Vaughan, Jr., and Ralph E. Whatley, III, M.D. - Business relationship due to each serving as officers, directors, and/or employees of the same related organizations.”

“Certain management and related services for the organization are provided by the management and employees of Carilion Services, Inc., a related and supporting organization of the filing organization.”

“The organization has a single member. The sole member is Carilion Clinic, a charitable tax-exempt organization which serves as the parent company of the Carilion Clinic integrated health care delivery system. The sole member elects the directors of the organization and has certain other reserved powers.”

“The sole member of the organization, Carilion Clinic, elects the members of the governing body of the organization periodically as terms expire. The sole member also has the right to remove directors and fill any vacancies on the board that may occur for any reason.”

“The sole member of the organization, Carilion Clinic, holds reserved powers with respect to certain enumerated actions, including appointment of CEO, approval of borrowings, budgets and strategic plans and amendments of Articles of Incorporation and Bylaws. Approval by the Board of Directors of Carilion Clinic is required for such actions. In addition to the reserved powers, under the laws of the Commonwealth of Virginia certain extraordinary actions require member approval, such as mergers, consolidations, liquidations, and the sale of substantially all of the assets of the organization.”

“The Form 990 was prepared by Carilion's internal tax department with input from various Carilion departments as applicable, and reviewed by internal Accounting management. All Board Members were notified via email that the final Form 990 was posted on our Board portal several days prior to filing and were encouraged to call with any questions they might have.”

“Our organization monitors and reviews proposed and current transactions for conflicts of interest in a variety of ways. At the governing board level, we have board members complete an initial (upon appointment) and annual conflict of interest questionnaire to disclose actual or potential conflicts. Board members are required to update their disclosure as needed in between questionnaires. All disclosures are reviewed by the Organizational Integrity & Compliance Office and as needed escalated to the appropriate leaders/board members for further discussion/review. If a disclosure is viewed as an actual or potential conflict, an action is recommended to the Audit & Compliance Committee of the Carilion Clinic Board and is implemented as approved. Actions can include recusal in discussion/voting at board meetings, limitation/termination of the transaction, removal from board appointment or other appropriate controls. In addition, at any time, board members are encouraged to disclose any potential conflicts as they arise at a board meeting and to recuse themselves as deemed appropriate. The same process takes place as described above for key employees (upon hire and annually thereafter), including all Officers, members of the management team, physicians/mid-level practitioners, pharmacists and key supply chain buyers. After review and further discussion as needed, action may be required to manage an actual conflict or to reduce the appearance of such as approved by the Organizational Integrity & Compliance Office and other key management team members. As needed, the governing board leaders are notified of any conflicts which may impact board proceedings.”

“Executive compensation is reviewed annually by the Carilion Clinic Compensation Committee. This committee is made up of Board members of Carilion Clinic who do not have a conflict of interest with any of the executives being reviewed. With respect to Carilion Clinic, the Compensation Committee reviews the compensation of the Board of Governors which includes the President and Chief Executive Officer, Executive Vice Presidents, Chief Financial Officer, Chief Medical Officer, and Chairs of the Clinical Departments. For the fiscal year covered by this return, the Compensation Committee also used the same process to review the compensation of other Disqualified Individuals, including the Hospital Vice Presidents. This review was performed in September and October 2014. A similar review was last performed in October 2015. This review included review of a comprehensive report from an outside compensation consultant specializing in healthcare organizations for select positions and the prior year's report on all of the reviewed positions. The reports reviewed by the Committee included a detailed comparison of total compensation and each element thereof, including base salary, bonuses and other cash compensation, and benefits, including deferred and retirement benefits. Compensation was compared to a peer group of organizations similar in size and structure to the organization, which list was reviewed by the Compensation Committee. Detailed minutes of the meetings of the Compensation Committee are kept and approved at the next meeting of the Committee, setting forth the deliberations and decisions regarding the compensation of these executives. In addition, the Compensation Committee annually reviews the compensation plan and philosophy for all vice presidents and senior vice presidents, as well as all employed physicians and physicians in leadership roles.”

“The organization's governing documents, conflict of interest statement and financial statements are not generally available to the public, but are released from time to time upon request. The Articles of Incorporation are available from the Virginia State Corporation Commission. The consolidated audited financial statements of Carilion Clinic and of the Obligated Group are released annually to the local newspaper. Limited financial information is available on our website.”

“Pension-Related Changes -11,081. Net Transfers To Affiliates 101,273.”