University Health Care Inc

“The organization has five (5) initial members (also known as sponsors). In addition, upon an affirmative vote of seventy-five (75%) of the votes held by the members entitled to vote, the members may provide that there shall be other members of the organization. The other members must be exempt from income tax under section 501(c)(3) of the code or are described in section 170(c)(1) of the code; provided, the board of directors may provide in the bylaws for a separate class of members that are not exempt under section 501(c)(3) or are not described in section 170(c)(1), but the creation or existence of any such separate class of members must not cause the corporation to cease to be an exempt organization under section 501(c)(3). Each initial member shall be entitled to appoint a certain number of directors. One member may appoint 5 directors and 4 members may appoint 1 director. Other members (other than the initial members) may have the right to appoint directors. Currently there are no other members. Members, through their board of director appointments, approve significant decisions of the governing body. Upon dissolution of the organization, assets that have been received and are held by the organization subject to limitations permitting their use only for charitable, scientific, literary, religious, educational or similar purposes, and that are not held upon a condition requiring return, transfer, or conveyance by reason of dissolution, shall be transferred or conveyed to each member pursuant to certain provisions of their member agreement. In addition, other assets, if any, shall be transferred or conveyed to the members for a public purpose, pursuant to a plan of distribution adopted as provided by law. In addition, the organization has an affiliation agreement with the partnership council, inc. (partnership council) under which the partnership council provides support and assistance to the organization to aid the organization in its role as the provider of medicaid services in designated regions of kentucky under a program established by the commonwealth of kentucky. The partnership council has the right to appoint three members to the governing body of passport.”

“One initial member may appoint 5 directors. The other four initial members may each appoint one director. The partnership council shall have the right to appoint 3 directors. Such appointed directors have the right to appoint 3 community at-large directors.”

“A copy has been provided to the executive committee of the board of directors and the executive compensation committee for review prior to filing. The final return will be posted on the company's website. The tax return is reviewed and approved by the company's chief financial officer. Pertinent data is compared to audited financial statements to ensure accuracy.”

“Passport has two conflict of interest policies -- one for its board members and executives; and one for all other associates. We have two conflict of interest policies to account for the heightened scrutiny we believe we should give to the activities and financial interests of our board members and executives. We have developed a process for conflict of interest training and for monitoring and enforcing compliance with the conflict of interest policies. We require board members, executives and all other associates to disclose potential conflict of interest situations on an annual basis. Associates including executives participate in conflict of interest training on an annual basis. The annual training includes having associates and executives disclose any possible conflict-of-interest situations. The key to our plan is to identify any possible conflict-of-interest situations and then have the vp, human resources and vp, chief compliance officer review the disclosures to determine whether any action should be taken. The passport board has developed its process for review of conflict of interest disclosures. The board has formed a compliance committee to oversee and direct that passport conducts a thorough and prompt investigation of any conflict of interest and that each board member completes a conflict of interest form annually. Board members are asked to abstain from voting in connection with the conflict of interest while the compliance committee decides if a conflict of interest exists.”

“Passport's board of directors has formed an executive compensation committee whose purpose is to fulfill the board's oversight responsibilities through (1) the established requisite processes and procedures to insure the committee members do not have a conflict of interest, (2) use of an independent consultant to provide market data based on nationally published survey data for organizations of like size and organizational complexity in the benchmarking of executive compensation for the review process, and (3) documentation of all deliberations, determinations and actions regarding executive compensation in the committee meeting minutes. Passport is complying with all of the requirements necessary to establish reasonable compensation for its executives.”

“Annual financial statements are posted to the organization's website. The organization does not make its governing documents or conflict of interest policy available to the public.”

“Change in interest rate swap valuation -863,309.”

“The process has not changed from the prior year. Passport's board of directors has formed an audit committee to assist the board in fulfilling its oversight responsibilities by reviewing the integrity of the financial statements and financial reporting process, reviewing the qualifications and independence of the independent auditors and the performance of passport's internal audit function, reviewing and approving reports required by applicable rules promulgated by various government and regulatory agencies, and reviewing any other matters directed by the board or the audit committee charter.”