Franciscan Communities Inc. II

“Sr. Francis Clare Radke, Judy Amiano, James Stark, Andrew Duren, Ronald Tinsley, Daniel Noonan, Tracy Shearer and Denise Boudreau - Business relationship”

“The sole corporate member of Franciscan Communities, Inc. II is the Franciscan Sisters of Chicago Service Corporation ("FSCSC"). The members of FSCSC shall consist of the General Minister and the members of the General Council of the Franciscan Sisters of Chicago (the "Members"). The Members shall act in a stewardship capacity and ensure that all actions of Franciscan Communities, Inc. II are consistent with the purposes of FSCSC and the ethical and religious principles of the Franciscan Sisters of Chicago and in furtherance of their apostolate of quality care.”

“The sole corporate Member, the Franciscan Sisters of Chicago Service Corporation, has the reserve power to appoint and remove directors and fill vacancies on the Board of Directors of Franciscan Communities, Inc. II.”

“The Member, the Franciscan Sisters of Chicago Service Corporation ("FSCSC"), shall have the following reserved powers: (A) TO APPROVE THE Franciscan Communities, Inc. II STRATEGIC PLANS, ANNUAL, OPERATING, CAPITAL AND CASH FLOW BUDGETS AND SIMILAR DOCUMENTS DEVELOPED BY THE BOARD. (B) Governing document amendments and governance - 1. To approve any amendments to the articles of incorporation, bylaws and similar governing documents of Franciscan Communities, Inc. II. 2. To appoint and remove any director to the Board. 3. To appoint and remove the Chairperson and the President/CEO of Franciscan Communities, Inc. II. 4. To appoint and remove members of the Advisory councils and to approve any constitutions, policies or other governing documents which govern the conduct of such Advisory Councils. (C) Significant actions - 1. To approve any merger, consolidation, dissolution or liquidation of Franciscan Communities, Inc. II, other than a merger or consolidation solely between existing affiliates, subject to approval of the Members of FSCSC. 2. To approve the purchase, sale, donation, lease, mortgage, or any other acquisition, disposition or encumbrance of any assets of Franciscan Communities, Inc. II, including any such action pursuant to any order of a U.S. Bankruptcy Court, except with respect to transactions within limits delegated to Franciscan Communities, Inc. II, or specifically approved as part of a Strategic and Financial Plan of Franciscan Communities, Inc. II. 3. To approve the establishment, termination, transfer or other acquisition or disposition of a major ministry, work or similar program by Franciscan Communities, Inc. II or any affiliate, subject to approval of the Members of FSCSC. 4. TO APPROVE THE CREATION OF ANY NEW AFFILIATE OR ANY AFFILIATION OF FRANCISCAN COMMUNITIES, Inc. II WITH ANOTHER ENTITY, SUBJECT TO APPROVAL OF THE MEMBERS OF FSCSC. 5. To approve the incurrence of indebtedness, the making of loans to other entities or the guaranty of any indebtedness of others, by Franciscan Communities, Inc. II, for amounts in excess of the FSCSC-specified limits, except with respect to transactions specifically approved as part of a Strategic and Financial Plan of Franciscan Communities, Inc. II. 6. To establish dollar limits below which Franciscan Communities, Inc. II may authorize financial expenditures. 7. To establish dollar limits below which Franciscan Communities, Inc. II may authorize litigation settlements or any release or cancellation by Franciscan Communities, Inc. II of a claim or right of action against another party. 8. To approve compliance plans, accounting, investing and human resource policies, employee pension and other benefit programs and other matters to the extent determined appropriate by FSCSC. 9. To approve ethicists, auditors, legal counsel and other significant consultants of Franciscan Communities, Inc. II. 10. To establish compensation ranges for employees of Franciscan Communities, Inc. II, to the extent deemed appropriate.”

“Management presented a final draft of the completed form 990, including all applicable schedules, to the Audit and Finance Committee and made the same available to all board members, prior to its filing with the Internal Revenue Service.”

“As provided for in the conflict of interest policy, it is the responsibility of the Board or Committee Chair to ensure that each director, officer, and member of a board committee annually signs an FSCSC approved conflict of interest disclosure statement. Copies of all signed statements are forwarded to the Compliance Officer. Key employees, officers and highest compensated employees are required to complete an annual conflict of interest statement that is reviewed by their direct supervisor. Potential conflicts of interest of board members are brought to the attention of the board chair. After discussion with the interested person, he or she shall leave the board or committee meeting while a determination of a conflict of interest is discussed and voted on. Proposed transactions with interested persons on the Board of Directors or committees require the approval of the board prior to entering into the proposed transaction or arrangement. The interested person shall not be in attendance during the presentation or the vote on the proposed transaction or arrangement. KEY EMPLOYEES, OFFICERS AND HIGHEST COMPENSATED EMPLOYEES ARE REQUIRED TO COMPLETE AN ANNUAL CONFLICT OF INTEREST STATEMENT THAT IS REVIEWED BY THEIR DIRECT SUPERVISOR. THE SUPERVISOR WILL WORK WITH THE COMPLIANCE OFFICER AND POSSIBLY HUMAN RESOURCES IN TAKING APPROPRIATE STEPS TO ADDRESS THE POTENTIAL CONFLICT.”

“FRANCISCAN Communities, Inc. II TOP MANAGEMENT OFFICIAL IS PAID BY THE FRANCISCAN SISTERS OF CHICAGO SERVICE CORPORATION ("FSCSC"), A RELATED TAX-EXEMPT ORGANIZATION. The board of directors of the organization has adopted an executive compensation philosophy to enable FSCSC to recruit, retain, develop and motivate capable and committed executive leaders essential to sustaining its mission and achieving its vision and organizational goals. The executive compensation committee monitors the compensation strategy to reflect changes in market conditions and executive needs. This strategy and the reward elements serve as a "road map" for the on-going administration of the compensation programs. The Board has adopted a philosophy of viewing executive compensation in its totality, considering all reward elements - both extrinsic and intrinsic, provided to executives. Annually, the executive compensation committee makes the recommendation on the compensation for the president and chief executive officer with final approval from the sponsor as recommended by the FSCSC board of directors. The recommendation is based, in part, on the review of the most current market data available and compensation strategy discussion. FSCSC's president and chief executive office makes recommendations to the executive compensation committee for the establishment of salary ranges and salaries for the chief financial officer and chief operating officer of the organization. The executive compensation committee of the board of directors has adopted a practice of having a third-party review of total remuneration for executive staff and obtains a letter of reasonableness every two to three years. This third party review includes: 1. Obtain and analyze comparable compensation data for similar persons in functionally comparable positions in similar organizations; 2. Contemporaneous documentation and record keeping with respect to deliberations and decisions regarding the compensation arrangements is maintained; 3. The process of obtaining comparable compensation data was last performed in May 2019, and the executive Compensation Committee reviewed the third party data regarding Executive Compensation for the CEO, in light of the current year trends.”

“The President and Chief Executive Officer, makes recommendations to the Executive Compensation Committee for the establishment of salary ranges and salaries for the Chief Financial Officer and Chief Operating Officer of the organization. The Chief Talent Officer is responsible for making recommendations and establishing compensation ranges for the position of Vice President of Ministry Development; Chief Talent Officer; Vice President of Mission Integration and Pastoral Care; and Vice President of Clinical Services. FSCSC's Chief Talent Officer has the responsibility to establish compensation recommendations for the organization's other officers and key employees. The process for determining the appropriate compensation of each position includes: 1. Human Resources department obtains and analyzes comparable compensation data for similar person in functionally comparable position in similar organizations. 2. President and Chief Executive Officer reviews and make final approval of compensation ranges and salaries. 3. Compensation review is shared with the Executive Compensation Committee for all executive positions. 4. Contemporaneous documentation and record keeping with respect to deliberations and decisions regarding the compensation arrangements is maintained.”

“The organization makes its governing documents, conflict of interest policy and financial statements available to the public in accordance with applicable laws and regulations.”

“FRANCISCAN Communities, Inc. II other officers are paid by the Franciscan Sisters of Chicago Service Corporation ("FSCSC"), a related tax exempt organization. The President and Chief Executive Officer, makes recommendations to the executive compensation committee for the establishment of salary ranges and salaries for the chief financial officer and chief operating officer of the organization. The Chief Talent Officer is responsible for making recommendations and establishing compensation ranges for the positions of Vice President of Ministry Development; Chief Talent Officer; Vice President of Mission Integration and Pastoral Care, and Vice President of Clinical Services with the approval of the President and Chief Executive Officer. FSCSC's Chief Talent Officer has the responsibility to establish compensation recommendations for the organization's other officers and key employees. The process for determining the appropriate compensation of each position includes: 1. Human resource department obtains and analyzes comparable compensation data for similar persons in functionally comparable positions in similar organizations. The process of obtaining comparable compensation data was last performed in Spring 2017; 2. President and Chief Executive Officer reviews and makes final approval of compensation ranges and salaries; 3. Compensation review is shared with the executive compensation committee for all executive positions; 4. Contemporaneous documentation and record keeping with respect to deliberations and decisions regarding the compensation arrangements is maintained.”

“The values of Franciscan Communities Inc II include: 1 Respect: Reflect God in all we do; 2 Dedication: Passionately carry forward this ministry entrusted to us. 3 Stewardship: Responsibly using the gift of our resources; 4 Joy: Give from your heart.”