2022-04-20T11:10:01-05:00 2021-06-30 135565207 KPMG LLP 8350 BROAD STREET SUITE 900 MCLEAN VA 22102 990 2020-07-01 541278830 CHILDREN'S HEALTH SYSTEM INC CHIL 7576687000 601 CHILDRENS LANE NORFOLK VA 23507 DENNIS RYAN CFO/ASST TREAS/SECR 7576687000 2022-04-19 1 DENNIS RYAN 999009999 RAYMOND LY P01205643 7032868000 2022-04-18 3 AAL1 IAL1 2020 2022-09-23 18:48:47Z JAMES DAHLING 601 CHILDRENS LANE NORFOLK VA 23507 50031475 0 X WWW.CHKD.ORG X 1984 VA SEE SCHEDULE OCHILDREN'S HEALTH SYSTEM IS A MULTI-SPECIALTY HEALTH SYSTEM SERVING SOUTHEASTERN VIRGINIA AND NORTHEASTERN NORTH CAROLINA OFFERING COMPREHENSIVE PEDIATRIC CARE FOR CHILDREN FROM BIRTH TO AGE 21. 20 17 55 17 0 0 7000000 15350000 20285824 15881246 705011 504147 2340424 3224012 30331259 34959405 8800000 600000 0 0 13437867 11066871 1100 0 330346 23176594 19020355 45415561 30687226 -15084302 4272179 117192191 122433385 92185807 87236241 25006384 35197144 X SEE SCHEDULE OCHILDREN'S HEALTH SYSTEM IS A PEDIATRIC HEALTHCARE SYSTEM DEDICATED TO THE HEALTH AND WELLBEING OF CHILDREN AND YOUNG ADULTS FROM SOUTHEASTERN VIRGINIA, VIRGINIA'S EASTERN SHORE AND NORTHEASTERN NORTH CAROLINA. THROUGH ITS OVERSIGHT AND MANAGEMENT OF CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS, CHILDREN'S MEDICAL GROUP, CHILDREN'S SURGICAL SPECIALTY GROUP AND CHILDREN'S HEALTH FOUNDATION, THE HEALTH SYSTEM MEETS THE VARIED MEDICAL NEEDS OF MORE THAN 400,000 INFANTS, CHILDREN, TEENS AND YOUNG ADULTS. 0 0 23872223 600000 16034291 THE HEALTH SYSTEM PROVIDED LONG RANGE PLANNING, MANAGEMENT AND SUPPORT SERVICES FOR ITS SUBSIDIARIES IN FURTHERANCE OF THEIR MISSIONS. CONTINUING MEDICAL EDUCATION PROGRAMS FOR COMMUNITY PHYSICIANS AND SUPPORT SERVICES FOR ITS SUBSIDIARY CORPORATIONS IN THE FURTHERANCE OF THEIR MISSIONS. 23872223 1 1 0 1 0 0 0 0 0 0 1 0 0 1 1 1 0 1 0 0 0 0 0 0 0 0 0 1 0 1 1 0 0 0 0 0 0 0 0 0 0 1 0 0 0 1 1 1 1 0 0 1 44 0 1 55 1 0 0 0 0 0 0 0 0 0 0 1 0 X 20 17 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 0 NC VA X DENNIS RYAN 7576687000 601 CHILDRENS LANE NORFOLK VA 23507 JAMES D DAHLING PRESIDENT/CEO/DIRECTOR 41.00 2.00 X X 1302389 0 88728 ROBERT OBERMEYER MD DIRECTOR 1.00 41.00 X 0 683960 38041 SCOTT NOTTINGHAM MD DIRECTOR 1.00 41.00 X 0 385030 37936 AKHIL JAIN CHAIRMAN/DIRECTOR 2.00 2.00 X X 0 0 0 ELLY BRADSHAW SMITH DIRECTOR 1.00 1.00 X 0 0 0 KATHRYN M VAN BUREN DIRECTOR 1.00 1.00 X 0 0 0 KIM GEORGES SECRETARY/DIRECTOR 2.00 2.00 X X 0 0 0 MARTA SATIN-SMITH DIRECTOR 1.00 1.00 X 0 0 0 MILES LEON DIRECTOR 1.00 1.00 X 0 0 0 R JUSTIN FULTON VICE CHAIRMAN/DIRECTOR 2.00 2.00 X X 0 0 0 SUSAN R EINHORN DIRECTOR 1.00 1.00 X 0 0 0 SVINDER S TOOR MD DIRECTOR 1.00 1.00 X 0 0 0 MARTHA COLEN DIRECTOR 1.00 1.00 X 0 0 0 EDWARD WHITMORE TREASURER/DIRECTOR 2.00 2.00 X X 0 0 0 STACEY VELLINES DIRECTOR 1.00 1.00 X 0 0 0 KIERAN POULOS DIRECTOR 1.00 1.00 X 0 0 0 KEVIN MURPHY DIRECTOR 1.00 1.00 X 0 0 0 OWEN GRIFFEN DIRECTOR 1.00 1.00 X 0 0 0 BRIAN SKINNER DIRECTOR 1.00 1.00 X 0 0 0 JULIA CHILDRESS BECK DIRECTOR 1.00 1.00 X 0 0 0 DENNIS RYAN CFO/ASST TREAS/ASSIST SECR 41.00 2.00 X 1021453 0 485645 AMY SAMPSON CHIEF ENGAGEMENT/INNOVATION OF 40.00 0.00 X 493284 0 256973 TAMIKA HARRIS VP FACILITIES & SUPPORT SERV 0.00 40.00 X 0 257134 86535 DEBORAH BARNES VP - IS OPERATIONS 40.00 0.00 X 711700 0 390222 JOHN HARDING CHIEF OPERATING OFFICER 40.00 0.00 X 756586 0 349879 PAUL MORLOCK VP HR AND OCCUPATIONAL HEALTH 40.00 0.00 X 413524 0 219742 KATHRYN ABSHIRE VP FINANCE 40.00 0.00 X 270719 0 158305 KIMBERLY DAY VP GENERAL COUNSEL 40.00 0.00 X 373714 0 96577 STEPHANIE CALLIOTT FORMER SVP-COMMUNITY RELATIONS 0.00 0.00 X 795452 0 0 6138821 1326124 2208583 17 1 1 0 SYR INC 795 MONTICELLO AVE NORFOLK VA 236010337 MGMT & WF FEE 6561960 DAVIS & COMPANY 1705 BALTIC AVE VIRGINIA BEACH VA 23455 ADVERTISING 1216119 WILLIAMS MULLEN PO BOX 800 RICHMOND VA 23218 LEGAL 438459 KPMG LLP PO BOX 120522 DALLAS TX 75312 ACCOUNTING 434625 DENTON LIFE SAFETY CONSULTING 101 HIGHLANDER DRIVE HENDERSONVILLE TN 37075 CONSTRUCTION 197318 16 15350000 15350000 MANAGEMENT FEES FROM SUBSIDIARIES 900099 14870424 14870424 SALARY AND SUPPORT REVENUE 900099 765861 765861 CONTRACT REVENUE 900099 244961 244961 15881246 317529 317529 3064295 2240957 823338 823338 823338 875477 3000 691859 0 183618 3000 186618 186618 14295289 12139254 2156035 2156035 GAIN/LOSS ON UNCONSOLIDATED SUBS. 900099 91594 91594 153045 153045 244639 34959405 16034291 0 3575114 600000 600000 2238823 246267 1851661 140895 5437036 3233196 2201452 2388 2382353 993484 1388869 683184 455942 226925 317 325475 216579 108782 114 709694 110639 599055 467374 467236 138 279848 279848 1222579 1216010 6340 229 1751206 1751201 5 1636827 1615245 1334 20248 147292 147292 154889 151503 3386 44427 11079 33174 174 10085 9753 332 1078065 1078065 10000000 10000000 43220 30858 12362 958925 862428 96497 EQUIP RENTAL AND MAINT. 32555 19712 12843 SUPPLIES 13841 9626 1872 2343 PURCHASED SERVICES 8232 8232 461296 358028 64723 38545 30687226 23872223 6484657 330346 5241258 8065687 20950 17432 488191 598885 55763093 7594626 50732549 48168467 6509531 8255163 3749164 4860093 50450548 52467658 117192191 122433385 5735201 6693924 48580713 47925363 37869893 32616954 92185807 87236241 X 25006384 35197144 25006384 35197144 117192191 122433385 X 4272179 823829 486251 4608501 X 0 1 X 1 1 1 X X 1 CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS INC 540506321 3 1 600000 0 1 600000 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 PART I, LINE 12G, COLUMN (VI) THE EXPENSES INCURRED BY CHILDREN'S HEALTH SYSTEM, INC. THAT ARE REPORTED ON FORM 990, PART IX WERE EXPENDED TO PROVIDE SUPPORT AND MANAGEMENT TO ITS SUPPORTED ORGANIZATION. RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 1 1 0 0 0 0 1 348895 0 0 348895 0 PART II-B, LINE 1: CHILDREN'S HEALTH SYSTEM (CHS) TAKES THE WELFARE OF THE CHILDREN THAT ARE CARED FOR WITHIN THE CHS FAMILY AS A PRIORITY. AS SUCH, THERE ARE MANY LEGISLATIVE ISSUES THAT OUR STATE AND FEDERAL GOVERNMENTS HANDLE THAT COULD AFFECT CHS. CHS RELIES ON VOLUNTEERS FROM THE NORFOLK CITY UNION OF THE KING'S DAUGHTERS, INC. (NCUKD) TO ASSIST IN LETTER-WRITING, EXERCISING THE PERSONAL RIGHTS TO VOTE AND IN SPREADING EDUCATION ON LEGISLATIVE ISSUES AFFECTING THE ORGANIZATION. ADDITIONALLY, CHS HAS PAID STAFF AND MANAGEMENT ALONG WITH MEMBERSHIP IN HEALTHCARE ASSOCIATIONS AND RETENTION OF PROFESSIONAL LOBBYING FIRMS THAT WORK ON LOBBYING ISSUES AND HAVE DIRECT CONTACT WITH LEGISLATORS, GOVERNMENT OFFICIALS AND OTHER MEMBERS OF LEGISLATIVE INFLUENCE. ISSUES THAT ARE ADDRESSED INCLUDE DISPROPORTIONATE SHARE HOSPITAL FUNDING, BECAUSE A HIGH PERCENTAGE OF PATIENTS CARED FOR IN THE CHS FAMILY ARE COVERED BY MEDICAID, CHILDREN'S HOSPITALS GRADUATE MEDICAL EDUCATION BUDGET AND FUNDING, TRICARE FUNDING FOR CHILDREN'S HEALTH ISSUES, MEDICAID/CHIP, CHILDREN'S MENTAL HEALTH SERVICES, MEDICAL EDUCATION, DEFENSE HEALTH AGENCY FUNDING, SURPRISE MEDICAL BILLING, THE AMERICAN RESCUE PLAN ACT, THE FEDERAL RESPONSE TO THE COVID-19 VIRUS (INCLUDING CARES ACT, HEROES ACT, HEALS ACT AND DELIVERING IMMEDIATE RELIEF TO AMERICA'S FAMILIES, SCHOOLS AND SMALL BUSINESSES ACT) AND ONGOING COVID-19 RESPONSE NEGOTIATIONS. 19662039 19662039 34146957 6390482 27756475 264675 224727 39948 1689422 979417 710005 48168467 INVESTMENT IN SUBSIDIARIES 36897015 457B/TOPHAT INVESTMENT 10394006 INSURANCE RECOVERABLE 3879183 CSV OF LIFE INSURANCE 491327 INTERCOMPANY RECEIVABLE 456748 SERP PLAN ASSETS 231106 ACCOUNTS RECEIVABLE MISC 118273 52467658 SERP LIABILITIES 13272739 457B/TOPHAT LIAB 10394006 DERIVATIVE INSTRUMENTS 4046778 IBNE INSURANCE CLAIMS 3879183 ACCRUED TAIL COVERAGE 502012 EXEC CAP APPREC ACCT (CAA) 435721 INTERCOMPANY LIABILITIES 86515 32616954 X PART X, LINE 2: ASC 740 FOOTNOTE FROM CONSOLIDATED AUDIT REPORT CHS RECOGNIZES ANY BENEFITS FROM AN UNCERTAIN TAX POSITION ONLY IF IT IS MORE LIKELY THAN NOT THAT THE TAX POSITION WILL BE SUSTAINED UPON EXAMINATION BY THE TAXING AUTHORITIES, BASED ON THE TECHNICAL MERITS OF THE POSITION. IF APPLICABLE, THE TAX BENEFITS RECOGNIZED IN THE CONSOLIDATED FINANCIAL STATEMENTS FROM SUCH A POSITION WOULD BE MEASURED BASED ON THE LARGEST BENEFIT THAT HAS A GREATER THAN 50% LIKELIHOOD OF BEING REALIZED UPON ULTIMATE RESOLUTION. CHS DOES NOT BELIEVE ITS CONSOLIDATED FINANCIAL STATEMENTS INCLUDE ANY UNCERTAIN TAX POSITIONS. 1 CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS 601 CHILDRENS LANE NORFOLK VA 23507 540506321 501(C)(3) 600000 SUPPORT MISSION 1 0 SCHEDULE I, PART II CHILDREN'S HEALTH SYSTEM, INC. DID NOT PROVIDE GRANTS TO UNRELATED THIRD PARTIES DURING THE TAX YEAR. THE AMOUNTS LISTED ON PART II ARE CONTRIBUTIONS TO THE ORGANIZATIONS LISTED. X 1 1 X X X X 0 1 0 0 0 0 0 0 0 DENNIS RYAN CFO/ASST TREAS/ASSIST SECR 550018 0 0 0 471435 0 445037 0 40608 0 1507098 0 452439 0 JAMES D DAHLING PRESIDENT/CEO/DIRECTOR 1079360 0 0 0 223029 0 54989 0 33739 0 1391117 0 154986 0 JOHN HARDING CHIEF OPERATING OFFICER 609706 0 0 0 146880 0 311500 0 38379 0 1106465 0 131386 0 DEBORAH BARNES VP - IS OPERATIONS 409822 0 0 0 301878 0 363472 0 26750 0 1101922 0 283171 0 STEPHANIE CALLIOTT FORMER SVP-COMMUNITY RELATIONS 0 0 0 0 795452 0 0 0 0 0 795452 0 795452 0 AMY SAMPSON CHIEF ENGAGEMENT/INNOVATION OF 322643 0 0 0 170641 0 237712 0 19261 0 750257 0 156206 0 ROBERT OBERMEYER MD DIRECTOR 0 664773 0 18750 0 437 0 11400 0 26641 0 722001 0 0 PAUL MORLOCK VP HR AND OCCUPATIONAL HEALTH 374501 0 0 0 39023 0 201753 0 17989 0 633266 0 21297 0 KIMBERLY DAY VP GENERAL COUNSEL 346923 0 0 0 26791 0 70145 0 26432 0 470291 0 0 0 KATHRYN ABSHIRE VP FINANCE 249849 0 0 0 20870 0 123297 0 35008 0 429024 0 5739 0 SCOTT NOTTINGHAM MD DIRECTOR 0 384778 0 0 0 252 0 11400 0 26536 0 422966 0 0 TAMIKA HARRIS VP FACILITIES & SUPPORT SERV 0 231785 0 0 0 25349 0 51461 0 35074 0 343669 0 15693 PART I, LINE 1A IN CONNECTION WITH A RETIREMENT PROGRAM, TAX GROSS-UP PAYMENTS ARE PROVIDED TO CERTAIN EMPLOYEES WHOSE EMPLOYER FUNDED CONTRIBUTIONS ARE IMMEDIATELY TAXABLE, IN ORDER TO PROVIDE THEM WITH BENEFITS THAT ARE TAX-EQUIVALENT TO BENEFITS OF PARTICIPANTS WHOSE CONTRIBUTIONS ARE NOT IMMEDIATELY TAXABLE. PART I, LINE 4B CHILDREN'S HEALTH SYSTEM SPONSORS TWO SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS (THE PLANS). THE PLANS ARE DESIGNED TO RETAIN EXECUTIVES IN POSITIONS ESSENTIAL TO THE SUCCESS OF CHILDREN'S HEALTH SYSTEM. DURING THE YEAR, THE FOLLOWING INDIVIDUALS WERE PARTICIPANTS IN ONE OF THE SPONSORED SUPPLEMENTAL NONQUALIFIED RETIREMENT PLANS AND RECEIVED THE FOLLOWING ANNUAL ACTUARIAL INCREASE OR DEFERRED CONTRIBUTION (INCLUDED IN SCHEDULE J, PART II, COLUMN (C)) AND/OR PAYMENT (INCLUDED IN SCHEDULE J, PART II, COLUMN (B)(III)). AMOUNTS REPORTED IN SCHEDULE J, PART II, COLUMN (B) III MAY DIFFER FROM AMOUNTS PAID DUE TO TIMING DIFFERENCES IN VESTING AND PAYMENTS. NAME: DENNIS RYAN ACT. INCREASE: $398,185 AMT. PAID: $194,068 NAME: AMY SAMPSON ACT. INCREASE: $203,688 AMT. PAID: $60,349 NAME: KATHRYN ABSHIRE ACT. INCREASE: $109,755 AMT. PAID: $0 NAME: DEBORAH BARNES ACT. INCREASE: $335,000 AMT. PAID: $120,084 NAME: TAMIKA HARRIS ACT. INCREASE: $23,202 AMT. PAID: $0 NAME: KIMBERLY DAY ACT. INCREASE: $52,146 AMT. PAID: $0 NAME: JOHN HARDING ACT. INCREASE: $264,365 AMT. PAID: $42,892 A VA SMALL BUSINESS FINANCING AUTHORITY 541200845 000000000 2015-12-01 100000000 FINANCING OF HEALTHCARE FACILITIES 0 0 0 A 3374637 51300000 51300000 2018 0 0 1 1 A 0 1 1 1 1 1 0.00330 0.00330 0 0 1 A 0 0 0 1 1 0 0 0 1 A 1 PART II, LINE 10 LINE 10 - CAPITAL EXPENDITURES FROM PROCEEDS ALLOCATED CURRENTLY TOTAL $99,950,000, OF WHICH $51,300,000 WAS ALLOCATED TO CHILDREN'S HEALTH SYSTEM AND $48,650,000 WAS ALLOCATED TO CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS. PART III, LINE 4 WE HAVE CONCLUDED THAT OUT OF THE ACTIVITIES CONDUCTED IN THIS BOND FINANCED SPACE, WE HAVE NOTED THAT .33% OF THE SPACE WAS PRIVATE BUSINESS USE. THE REMAINING SPACE DID NOT RESULT IN PRIVATE BUSINESS USE DUE TO EQUITY PROVIDED OR A REGULATORY SAFE HARBOR.OBLIGATED GROUP PNC BANK, NATIONAL ASSOCIATION AND BANK OF AMERICA, N.A., EACH HOLD PARITY NOTES OF CHKD'S OBLIGATED GROUP (INCLUDING CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS, INCORPORATED; CHILDREN'S HEALTH SYSTEM; AND CHILDREN'S HEALTH FOUNDATION, INC.) ISSUED UNDER THE MASTER TRUST INDENTURE. ACCORDINGLY, PNC AND BANK OF AMERICA HAVE THE BENEFIT, ON A PARITY BASIS, OF A VALID AND PERFECTED, FIRST PRIORITY SECURITY INTEREST HELD BY THE MASTER TRUSTEE IN THE TOTAL REVENUES PLEDGED UNDER THE MASTER TRUST INDENTURE AND IN ANY OTHER SECURITY INTEREST GRANTED BY THE MASTER TRUST INDENTURE. THE MASTER TRUST INDENTURE AND THE FINANCING DOCUMENTS WITH PNC AND BANK OF AMERICA PLACE CERTAIN RESTRICTIONS UPON CHKD'S OBLIGATED GROUP RELATIVE TO OPERATING RATIOS, INCURRENCE OF ADDITIONAL INDEBTEDNESS, MAINTENANCE OF TAX-EXEMPT STATUS AND FINANCIAL REPORTING REQUIREMENTS. X SELLING PRICE 0 1 1 PART I, LINE 32B: CHILDREN'S HEALTH SYSTEM PAYS SYR, INC. MANAGEMENT FEES TO MANAGE THRIFT STORES FOR THE BENEFIT OF THE ORGANIZATION. PART I, LINE 33: CHILDREN'S HEALTH SYSTEM RECEIVED NON-CASH CONTRIBUTIONS DURING THE YEAR; HOWEVER THESE NON CASH CONTRIBUTIONS WERE NOT VALUED UNTIL THE ITEMS WERE SOLD IN THE THRIFT STORE. FORM 990, PART VI, SECTION A, LINE 6 CHILDREN'S HEALTH SYSTEM, INC. HAS TWO CLASSES OF MEMBERS: 1) CLASS A MEMBERS (I.E., THE THEN CURRENT MEMBERS IN GOOD STANDING OF THE NORFOLK CITY UNION OF THE KING'S DAUGHTERS, INC., A VIRGINIA NON-STOCK NOT-FOR-PROFIT CORPORATION); AND 2) CLASS B MEMBERS (I.E., THE THEN CURRENT DIRECTORS ON THE BOARD OF DIRECTORS OF CHILDREN'S HEALTH SYSTEM, INC.). FORM 990, PART VI, SECTION A, LINE 7A THE CLASS A MEMBERS OF CHILDREN'S HEALTH SYSTEM, INC. (I.E., THE THEN CURRENT MEMBERS IN GOOD STANDING OF THE NORFOLK CITY UNION OF THE KING'S DAUGHTERS, INC., A VIRGINIA NON-STOCK NOT-FOR-PROFIT CORPORATION) ELECT ONE THIRD OF THE ELECTED DIRECTORS OF CHILDREN'S HEALTH SYSTEM, INC. THE CLASS B MEMBERS OF CHILDREN'S HEALTH SYSTEM, INC. (I.E., THE THEN CURRENT DIRECTORS ON THE BOARD OF DIRECTORS OF CHILDREN'S HEALTH SYSTEM, INC.) ELECT TWO THIRDS OF THE ELECTED DIRECTORS OF CHILDREN'S HEALTH SYSTEM, INC. FORM 990, PART VI, SECTION A, LINE 7B THE FOLLOWING DECISIONS OF THE BOARD OF DIRECTORS OF CHILDREN'S HEALTH SYSTEM, INC. ARE SUBJECT TO APPROVAL BY THE CLASS A AND CLASS B MEMBERS OF CHILDREN'S HEALTH SYSTEM, INC.: 1) ANY AMENDMENTS TO THE ARTICLES OF INCORPORATION OF THE CORPORATION; AND 2) ANY PROPOSED MERGER OR CONSOLIDATION OF THE CORPORATION, OR ANY SALE, LEASE, EXCHANGE, MORTGAGE, PLEDGE OR OTHER DISPOSITION OF ALL, OR SUBSTANTIALLY ALL, OF THE PROPERTY AND ASSETS OF THE CORPORATION. FORM 990, PART VI, SECTION B, LINE 11B THE 990 IS PREPARED BY AN INDEPENDENT ACCOUNTING FIRM USING THE ANNUAL FINANCIAL STATEMENTS THAT ARE REVIEWED BY THE BOARD AND AUDITED ANNUALLY AS A PART OF THE CONSOLIDATED FINANCIAL STATEMENTS OF CHILDREN'S HEALTH SYSTEM, INC. UPON COMPLETION OF THE DRAFT OF THE RETURN, A DETAIL REVIEW IS PERFORMED BY SEVERAL MEMBERS OF STAFF AND MANAGEMENT. PRIOR TO FILING WITH THE IRS, THE BOARD IS PROVIDED A COPY TO REVIEW. FORM 990, PART VI, SECTION B, LINE 12C CONFLICT POLICY CONSIDERATIONS CHS CONFLICT OF INTEREST POLICY INCLUDES OFFICERS, MEMBERS OF THE BOARD OF DIRECTORS AND BOARD COMMITTEES, KEY EMPLOYEES, ALL OTHER EMPLOYEES, PROFESSIONAL STAFF AND SUBSTANTIAL DONORS. ANNUALLY, A QUESTIONNAIRE IS DISTRIBUTED AND COLLECTED FROM OFFICERS, MEMBERS OF THE BOARD OF DIRECTORS AND BOARD COMMITTEES AND KEY EMPLOYEES. RESPONSES TO THE QUESTIONNAIRES ARE REVIEWED BY THE LEGAL AND FINANCE DEPARTMENTS. FOR KNOWN CONFLICTS, THE PERSON INVOLVED RECUSES HIMSELF OR HERSELF FROM DELIBERATIONS REGARDING THE TRANSACTION. VIOLATIONS OF THE CONFLICT OF INTEREST POLICY ARE REPORTED TO THE CHS BOARD CHAIR OR THE CHS COMPLIANCE OFFICER, AS APPLICABLE, AND MAY REQUIRE CORRECTIVE ACTION UP TO AND INCLUDING TERMINATION OF EMPLOYMENT. FORM 990, PART VI, SECTION B, LINE 15 COMPENSATION PROCESS CONSIDERATIONS AN INDEPENDENT COMPENSATION CONSULTANT APPROVED AND RETAINED BY THE COMPENSATION COMMITTEE OF THE BOARD ANNUALLY, USUALLY IN APRIL, PROVIDES EDUCATION AND PRESENTS TO THE FULL BOARD COMPARATIVE SALARIES AND SALARY RANGES FROM A DATABASE COMPRISED OF CHILDREN'S HOSPITALS AND OTHER APPLICABLE HOSPITALS FOR OFFICERS AND EXECUTIVES FOR THE BOARD TO REVIEW. THE COMPENSATION COMMITTEE WITH THE AID OF THE CONSULTANT REVIEWS AND MAKES DECISIONS AS TO EXECUTIVE SALARIES OF CHS AND ITS SUBSIDIARIES. THOSE SALARY CHANGES AND APPROVALS ARE CONTEMPORANEOUSLY DOCUMENTED BY MINUTES MAINTAINED BY THE COMPENSATION COMMITTEE AND SIGNED BY THE CHAIRMAN OF THE BOARD. FORM 990, PART VI, SECTION C, LINE 19 FINANCIAL STATEMENTS (PART OF THE CONSOLIDATED FINANCIAL STATEMENTS OF CHILDREN'S HEALTH SYSTEM, INC.) ALONG WITH GOVERNING DOCUMENTS OF THE ORGANIZATION INCLUDING THE CONFLICT OF INTEREST POLICY ARE AVAILABLE TO THE PUBLIC THROUGH DIRECT INQUIRY AND REQUEST. FORM 990, PART XI, LINE 9: CHANGE IN DERIVATIVE 4,981,200. CHANGE IN PENSION LIABILITY -372,699. CHKD THRIFT STORES LLC 601 CHILDRENS LANE NORFOLK VA 23507 THRIFT STORES VA 14295289 3581050 CHS INC CHILDREN'S REAL ESTATE 601 CHILDRENS LANE NORFOLK VA 23507 LESSOR VA 3064295 50082970 CHS INC CHILDREN'S RESEARCH HOLDINGS LLC 601 CHILDRENS LANE NORFOLK VA 23507 RESEARCH INV VA 0 4303366 CHS INC CHILDREN'S QUALITY CARE LLC 601 CHILDRENS LANE NORFOLK VA 23507 CIN VA 636864 986227 CHS INC CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS 601 CHILDRENS LANE NORFOLK VA 23507 540506321 HEALTHCARE VA 501(C)(3) 3 CHILDREN'S HEALTH SYSTEM 1 CHILDREN'S HEALTH FOUNDATION INC 601 CHILDRENS LANE NORFOLK VA 23507 541278865 SUPP CHKD VA 501(C)(3) 12A CHILDREN'S HEALTH SYSTEM 1 FORTIFY CHILDREN'S HEALTH LLC 1330 JEFFERSON PARK AVENUE CHARLOTTESVILLE VA 22903 831442745 HEALTHCARE VA N/A RELATED -267030 3165754 0 1 0.50000 REALTA HOLDINGS LLC 601 CHILDRENS LANE NORFOLK VA 23507 823954346 RESEARCH VA N/A RELATED -54869 2749 0 1 0.39700 CHILDREN'S SURGICAL SPECIALTY GROUP INC 601 CHILDRENS LANE NORFOLK VA 23507 311610834 HEALTHCARE VA N/A C 26411051 2376007 1.00000 1 CHILDREN'S MEDICAL GROUP INC 601 CHILDRENS LANE NORFOLK VA 23507 541778786 HEALTHCARE VA N/A C 88259063 28720960 1.00000 1 CMG OF NORTH CAROLINA INC 601 CHILDRENS LANE NORFOLK VA 23507 561960102 HEALTHCARE NC N/A C 3581767 236239 1.00000 1 1 1 1 1 0 0 0 0 0 0 0 1 1 1 1 1 1 1 0 CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS L 14870424 BOOK VALUE CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS D 440587 BOOK VALUE CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS B 600000 CASH CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS C 15350000 CASH CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS A 3064295 CASH CHILDREN'S SURGICAL SPECIALTY GROUP INC R 10000000 BOOK VALUE CHILDREN'S HOSPITAL OF THE KING'S DAUGHTERS M 486251 BOOK VALUE