Hendrick Medical Development Corporation

“Article 5 of the articles of incorporation provides, in part, that the baptist general convention of texas shall select the members of the board of trustees.”

“Article 8 of the articles of incorporation provides, in part, that the board of trustees shall not, without the consent of the baptist general convention of texas, amend the corporation charter, amend the bylaws to increase or decrease the number of trustees, and deviate from or amend the objective of the corporation. Article 10 of the articles of incorporation provides, in part that vacancies in the board of trustees arising from reasons other than the expiration of a term may be filled by the executive board of the baptist general convention of texas. In addition, this article also provides, in part, circumstances under which the board of trustees or individual members may be replaced. Article 13 provides, in part, that upon the dissolution of the corporation, after paying all liabilities, the disposal of the assets of the board of trustees shall determine, with the approval and consent of the baptist general convention of texas, article 9 of the articles of amendment provides, in part, for the consent of the baptist general convention of texas prior to disposing of any part of the physical plant under certain conditions.”

“The organization engages an outside accounting firm to prepare form 990. Once prepared, the form is reviewed by the organization's internal accountants and administrative management prior to filing.”

“The organization sends out a conflict of interest questionnaire annually to all trustees of the board and to the executive employees. The questionnaires are reviewed by our outside auditors prior to the annual audit and by the organization's director of compliance to identify possible conflicts of interest and other financial relationships under the conflict of interest policy.”

“A comprehensive review of compensation is conducted by an independent party at least every three years. This report presents the results of the analysis of salary, incentive, total cash compensation (salary plus incentive), benefits, and total compensation (total cash and benefits). Integrated healthcare strategies (ihs) works with the personnel committee to formally define an executive total compensation philosophy. Hendrick health system's current philosophy is to use ranges built around the median of the market with a 50% spread from minimum to maximum. Incentive opportunity levels are competitive with practices of peer groups and benefits will be delivered at market competitive levels, severance and perquisites reflect a conservative philosophy. The committee determined that the peer group would be primarily regional not-for-profit hospitals of similar size and complexity. National peer group will be used for reference purposes where appropriate. The hendrick health system personnel committee is delegated the responsibility for the executive compensation program by the board of trustees. The committee: sets the overall executive compensation philosophy to be implemented by hendrick health system; sets compensation components for the president & ceo; reviews, discusses and makes decision based on the president & ceo's recommendations for his direct reports; reports a summary of the process back to the board of trustees along with the actual compensation approved for the president and ceo; and approves all incentive goals and awards.”

“The organization makes its governing documents, conflict of interest policy, and financial statements available to the public upon request.”

“Other changes in net assets: equity distributions $ (85,486) equity in earnings of subsidiary 662,165 change of pv of trust interest 20,287 ----------- $ 596,966”