2017-10-25T10:46:10-05:00 2016-12-31 134008324 PRICEWATERHOUSECOOPERS LLP 76 S LAURA STREET SUITE 2100 JACKSONVILLE FL 32202 990 2016-01-01 203700526 SANTAFE SENIOR LIVING INC SANT 3523728400 SANTAFE HEALTHCAREINC PO BOX 749 GAINESVILLE FL 326270749 RANDALL L STUART ASSISTANT TREASURER 3523378730 2017-10-25 1 MICHAEL J MULDOON P00889797 9043540671 12.8.190.134 2017-10-25 10:10:25 ED P 54BF1586AE195AFAEC0F4B0B882D6F2A8E325AE6 9B8A486F8959EB47C448F2BA708CE67AF1BE41ED 2016 2021-01-29 14:40:06Z MICHAEL P GALLAGHER SANTAFE HEALTHCAREINC PO BOX 749 GAINESVILLE FL 326270749 4308782 0 X SANTAFEHEALTHCAREFL.ORG X 2005 FL SANTAFE SENIOR LIVING, INC. CREATES AND SUSTAINS PREEMINENT SENIOR LIVING COMMUNITIES. THE PRIMARY EXEMPT PURPOSE OF SANTAFE SENIOR LIVING, INC. IS TO GOVERN AND CARRY OUT THE PURPOSES OF A SYSTEM OF TAX-EXEMPT CHARITABLE ORGANIZATIONS THAT ACQUIRE, OWN, OPERATE, AND MAINTAIN FACILITIES AND SERVICES DESIGNED TO MEET THE PHYSICAL, SOCIAL, EMOTIONAL AND SPIRITUAL NEEDS OF SENIOR INDIVIDUALS. 15 14 23 0 0 0 0 0 3116590 3953058 340683 355724 0 0 3457273 4308782 0 0 0 0 2960835 2969384 0 0 0 1630641 1571311 4591476 4540695 -1134203 -231913 10202445 11572845 17832951 19435264 -7630506 -7862419 X TO CREATE AND SUSTAIN PREEMINENT SENIOR LIVING COMMUNITIES THAT PROVIDE A CONTINUUM OF SERVICES IN HOUSING, HEALTH CARE AND OTHER PROGRAMS TO ENHANCE THE QUALITY AND DIGNITY OF LIFE. 0 0 895282 3750369 DURING THE YEAR, SANTAFE SENIOR LIVING, INC. PROVIDED OVERSIGHT GOVERNANCE AND DEVELOPMENT PLANNING SERVICES TO BONITA SPRINGS RETIREMENT VILLAGE, INC. (DBA THE TERRACES AT BONITA SPRINGS). THE TERRACES AT BONITA SPRINGS SERVED AN AVERAGE PER DAY OF 286 SENIOR CITIZEN RESIDENTS WITH HOUSING, HEALTH CARE AND RELATED SERVICES DURING 2016.DURING THE YEAR, SANTAFE SENIOR LIVING, INC. PROVIDED OVERSIGHT GOVERNANCE AND DEVELOPMENT PLANNING SERVICES TO NORTH FLORIDA RETIREMENT VILLAGE, INC. (DBA THE VILLAGE). THE VILLAGE SERVED AN AVERAGE PER DAY OF 682 SENIOR CITIZEN RESIDENTS WITH AROUND THE CLOCK HOUSING, ASSISTED LIVING AND RELATED SERVICES DURING 2016.DURING THE YEAR, SANTAFE SENIOR LIVING, INC. PROVIDED OVERSIGHT GOVERNANCE AND REDEVELOPMENT PLANNING SERVICES TO A RELATED CONTINUING CARE RETIREMENT COMMUNITY, EAST RIDGE RETIREMENT VILLAGE, INC. THIS FACILITY PROVIDED AN AVERAGE PER DAY OF 321 SENIOR CITIZEN RESIDENTS WITH HOUSING, HEALTH CARE AND RELATED SERVICES DURING 2016. 207456 202689 DURING 2016, SANTAFE SENIOR LIVING, INC.'S DESIGN AND CONSTRUCTION SERVICES TEAM COORDINATED VARIOUS PROJECTS FOR ITS SENIOR LIVING COMMUNITIES, INCLUDING WARRANTY MANAGEMENT FOR A RECENTLY COMPLETED HEALTH CENTER; RENOVATION OF INDEPENDENT LIVING UNITS AT EAST RIDGE RETIREMENT VILLAGE, INC.; AND PROJECT CONSULTING FOR NORTH FLORIDA RETIREMENT VILLAGE, INC. AND BONITA SPRINGS RETIREMENT VILLAGE, INC. DESIGN AND CONSTRUCTION SERVICES ALSO PROVIDED ASSISTANCE TO AFFILIATED ENTITIES AVMED, INC. AND NORTH CENTRAL FLORIDA HOSPICE, INC., INCLUDING LEASE MANAGEMENT SUPPORT AND ASSISTANCE WITH THE EXPANSION OF NORTH CENTRAL FLORIDA HOSPICE, INC.'S GAINESVILLE CARE CENTER. 1102738 1 0 0 1 0 0 0 0 0 0 1 0 0 0 1 1 0 1 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 1 53 0 1 23 1 0 0 0 0 0 0 0 0 0 0 X 15 14 0 0 0 0 0 1 1 1 1 0 0 1 1 1 1 1 1 1 1 0 X TIMOTHY S BUIST VICE PRESIDENT OF FINANCE 3523378740 4300 NW 89TH BLVD GAINESVILLE FL 326065688 X SCOTTIE J BUTLER CHAIRMAN/DIRECTOR 0.10 2.90 X X 0 71123 0 JOE G DUNLAP VICE CHAIRMAN/DIRECTOR 0.10 1.40 X X 0 55010 0 ROBERT L EPLING TREASURER/DIRECTOR 0.10 1.40 X X 0 55663 0 ALBERT E DOTSON PHD SECRETARY/DIRECTOR 0.10 1.40 X X 0 53459 0 RICHARD M ANDERSON MD DIRECTOR 0.10 1.40 X 0 48582 0 JOSEPH W DAVIS DIRECTOR 0.10 1.40 X 0 50564 0 BENJAMIN I DOERR JR DIRECTOR 0.10 2.90 X 0 57405 0 GEORGE E FLETCHER DIRECTOR 0.10 1.40 X 0 51959 0 GLENDA E HOOD DIRECTOR 0.10 1.40 X 0 56509 0 ROBERT C HUDSON DIRECTOR 0.10 1.40 X 0 48909 0 PAMELA J MOONEY PHD DIRECTOR 0.10 1.40 X 0 51805 0 THOMAS A NATIELLO PHD DIRECTOR 0.10 1.40 X 0 55009 0 PAUL R PHILIP DIRECTOR 0.10 1.40 X 0 52959 0 JACKSON N SASSER PHD DIRECTOR 0.10 1.40 X 0 53484 0 JAMES L STRINGFELLOW SR DIRECTOR - THROUGH 2/25/2016 0.10 1.40 X 0 0 0 MICHAEL P GALLAGHER CHIEF EXECUTIVE OFFICER/DIRECTOR 1.00 59.00 X X 0 2987304 43719 RANDALL L STUART ASSISTANT TREASURER 0.00 60.00 X 0 799210 141683 CATHERINE E AYERS ASSISTANT SECRETARY 1.00 59.00 X 0 683536 53998 STEVEN M ZIEGLER ASSISTANT SECRETARY 1.00 61.00 X 0 643202 130811 TROY R HART PRESIDENT 8.00 42.00 X 593601 0 86538 TIM S BUIST VP FINANCE 4.00 36.00 X 223904 0 44421 ROSS DICKMANN EXECUTIVE DIRECTOR, BSRV, INC. 50.00 0.00 X 284591 0 36018 JEFFREY P MERRITT EXECUTIVE DIRECTOR, ERRV, INC. 50.00 0.00 X 198659 0 18942 REBECCA CATALANOTTO EXECUTIVE DIRECTOR, NFRV, INC. 0.00 40.00 X 37018 122577 18769 DAVID KREMER DIRECTOR, SFSL FOUNDATION 40.00 0.00 X 135013 0 29171 SHARON B BREITINGER DIRECTOR, DESIGN & CONSTRUCTION 40.00 0.00 X 130332 0 8845 EMMETT BANE III DIRECTOR, STRATEGIC HR BUSINESS PARTNER 40.00 0.00 X 128683 0 23023 1731801 5998269 635938 7 0 1 0 SANTAFE HEALTHCARE INC PO BOX 749 GAINESVILLE FL 326270749 MANAGEMENT & ADMINISTRATIVE 1139827 MOORE STEPHENS LOVELACE PA 255S ORANGE AVE STE 600 ORLANDO FL 32801 AUDIT SERVICES 104690 2 MANAGEMENT FEES 561000 3953058 3953058 3953058 355724 355724 4308782 3953058 0 355724 1412237 505617 906620 1309924 390165 919759 29552 20454 9098 68842 28473 40369 148829 45751 103078 1046179 1046179 8643 6089 2554 30367 30367 3800 912 2888 114641 297 114344 62919 4827 58092 6284 6284 128163 45140 83023 21346 844 20502 41541 3625 37916 10345 10345 DUES AND ASSESSMENTS 36484 675 35809 CORPORATE DEVELOPMENT 33262 33077 185 LICENSES AND FEES 27337 16792 10545 4540695 1102738 3437957 0 130220 788930 8168 17152 9274394 9961882 0 420727 135356 56486 86580 78870 703083 305284 10202445 11572845 586009 496604 17246942 18938660 17832951 19435264 X -7630506 -7862419 -7630506 -7862419 10202445 11572845 -231913 0 X X 0 1 X 1 0 X X X 5 SANTAFE SENIOR LIVING FOUNDATION INC 264464727 7 0 0 0 BVG ACQUISITION INC 203701186 10 0 0 0 EAST RIDGE RETIREMENT VILLAGE INC 590903331 10 0 0 0 BONITA SPRINGS RETIREMENT VILLAGE INC 262386152 10 0 0 0 NORTH FLORIDA RETIREMENT VILLAGE INC 591912330 10 0 0 0 5 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 PART I, LINE 12G, COL. (IV) AND PART IV, SECTION A, LINE 1: SANTAFE SENIOR LIVING, INC. IS A TYPE II SUPPORTING ORGANIZATION THAT IDENTIFIES ITS SUPPORTED ORGANIZATIONS BY CLASS OR PURPOSE IN ITS ARTICLES OF INCORPORATION IN ACCORDANCE WITH TREASURY REGULATION 1.509(A)-4(D)(2)(I)(B) AND (IV) (HISTORIC AND CONTINUING RELATIONSHIP BETWEEN THE SUPPORTING ORGANIZATION AND THE SUPPORTED ORGANIZATIONS BECAUSE OF WHICH AN IDENTITY OF INTERESTS HAS DEVELOPED BETWEEN OR AMONG THE ORGANIZATIONS). 0 0 0 0 0 0 0 0 1 30347 30347 0 PART II-B, LINE 1: SANTAFE SENIOR LIVING, INC. ENGAGED REPRESENTATION TO LOBBY THE FLORIDA STATE LEGISLATURE ON ITS BEHALF REGARDING GENERAL ISSUES OF IMPORTANCE TO THE SENIOR LIVING INDUSTRY. 135356 56486 78870 78870 DUE TO AFFILIATES 18081355 BENEFITS PAYABLE 629353 SELF-FUNDED CLAIMS PASS THROUGH - SANTAFE SENIOR LIVING, INC. 227952 18938660 X 4308782 0 4308782 0 4308782 4540695 0 4540695 0 4540695 PART X, LINE 2: EXPLANATION FOR UNCERTAIN TAX POSITIONS UNDER ASC 740: SENIOR LIVING AND THE AFFILIATES ARE EXEMPT FROM FEDERAL INCOME TAXES UNDER SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE. SENIOR LIVING AND THE AFFILIATES HAVE NO UNCERTAIN TAX POSITIONS AS OF DECEMBER 31, 2016. SENIOR LIVING AND THE AFFILIATES INCURRED NO INTEREST EXPENSE OR PENALTIES RELATED TO UNCERTAIN INCOME TAX PROVISIONS IN 2016 OR 2015. TAX YEARS 2013 THROUGH 2015 ARE SUBJECT TO EXAMINATION BY FEDERAL AND STATE TAXING AUTHORITIES. THERE ARE NO INCOME TAX EXAMINATIONS IN PROCESS AS OF THE DATE OF THIS REPORT. 1 1 0 0 0 0 0 0 0 MICHAEL P GALLAGHER CHIEF EXECUTIVE OFFICER/DIRECTOR 0 954319 0 1504255 0 528730 0 15900 0 27819 0 3031023 0 0 RANDALL L STUART ASSISTANT TREASURER 0 397774 0 266297 0 135139 0 115901 0 25782 0 940893 0 75986 CATHERINE E AYERS ASSISTANT SECRETARY 0 333839 0 225744 0 123953 0 23850 0 30148 0 737534 0 0 STEVEN M ZIEGLER ASSISTANT SECRETARY 0 334595 0 227147 0 81460 0 98458 0 32353 0 774013 0 66094 TROY R HART PRESIDENT 339589 0 190640 0 63372 0 62417 0 24121 0 680139 0 31552 0 TIM S BUIST VP FINANCE 191601 0 31287 0 1016 0 22096 0 22325 0 268325 0 0 0 ROSS DICKMANN EXECUTIVE DIRECTOR, BSRV, INC. 197358 0 58233 0 29000 0 20712 0 15306 0 320609 0 9287 0 JEFFREY P MERRITT EXECUTIVE DIRECTOR, ERRV, INC. 169231 0 10559 0 18869 0 5194 0 13748 0 217601 0 0 0 REBECCA CATALANOTTO EXECUTIVE DIRECTOR, NFRV, INC. 36888 111750 0 10042 130 785 1518 5040 2973 9238 41509 136855 0 0 DAVID KREMER DIRECTOR, SFSL FOUNDATION 128930 0 5385 0 698 0 3292 0 25879 0 164184 0 0 0 EMMETT BANE III DIRECTOR, STRATEGIC HR BUSINESS PAR 127057 0 0 0 1626 0 1465 0 21558 0 151706 0 0 0 PART I, LINE 3 MICHAEL P GALLAGHER IS THE CHIEF EXECUTIVE OFFICER (CEO) OF SANTAFE SENIOR LIVING, INC. MR. GALLAGHER IS COMPENSATED BY SANTAFE HEALTHCARE, INC., A RELATED SUPPORTING ORGANIZATION. SANTAFE HEALTHCARE, INC. UTILIZES THE FOLLOWING PROCESS TO ESTABLISH THE CEO'S COMPENSATION AND BENEFITS: ANNUALLY, THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS RETAINS AN INDEPENDENT THIRD PARTY COMPENSATION AND BENEFITS CONSULTING FIRM TO CONDUCT A MARKET COMPETITIVENESS REVIEW OF THE CEO'S TOTAL DIRECT COMPENSATION (BASE SALARY, ANNUAL INCENTIVES, AND LONG TERM INCENTIVES) AND BENEFITS. THE COMPETITIVE ANALYSIS INCLUDES COMPARISON TO SIMILAR POSITIONS IN COMPANIES OF SIMILAR SIZE WITHIN THE SAME OR SIMILAR INDUSTRY. THE INDEPENDENT CONSULTING FIRM MAKES RECOMMENDATIONS, IF ANY, DIRECTLY TO THE BOARD OF DIRECTORS. THE BOARD OF DIRECTORS ESTABLISHES THE FINAL COMPENSATION AND BENEFIT PACKAGE FOR THE CEO TAKING INTO CONSIDERATION THE MARKET COMPETITIVENESS REVIEW AND FINAL RECOMMENDATION OF THE INDEPENDENT CONSULTING FIRM. THE INDEPENDENT CONSULTING FIRM PROVIDES AN OPINION LETTER REGARDING THE REASONABLENESS OF THE CEO'S FINAL COMPENSATION AND BENEFITS PACKAGE. THE ACTIONS OF THE BOARD ARE DOCUMENTED IN THE MINUTES OF THE BOARD MEETING. PART I, LINES 4A-B (RELATES TO PART I, LINE 4A): LISTED PERSONS ARE EMPLOYEES OF SANTAFE SENIOR LIVING, INC. OR RELATED ORGANIZATIONS AND ARE COVERED UNDER A SEVERANCE POLICY FOR THEIR RESPECTIVE ORGANIZATION. THE SEVERANCE POLICY INCLUDES MONTHLY PAYMENTS UP TO A MAXIMUM OF 12 - 36 MONTHS UNDER QUALIFYING CIRCUMSTANCES DEPENDING ON POSITION. LISTED PERSONS WHO RECEIVED A SEVERANCE PAYMENT OR CHANGE OF CONTROL PAYMENT IN 2016 ARE AS FOLLOWS: JEFFREY P MERRITT RECEIVED $7,428 IN COMPENSATION PAYMENTS DUE TO A SEVERANCE AGREEMENT. (RELATES TO PART I, LINE 4B): LISTED PERSONS PARTICIPATING IN A SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN IN THE YEAR: SANTAFE SENIOR LIVING, INC. MAINTAINS TWO ACTIVE NONQUALIFIED DEFERRED COMPENSATION RETIREMENT PLANS FOR A CERTAIN GROUP OF EXECUTIVES TO INCLUDE THOSE LISTED EMPLOYEES OF SANTAFE SENIOR LIVING, INC. ONE PLAN RESTORES RETIREMENT BENEFITS EQUIVALENT TO QUALIFIED 401(K) BENEFITS ON INCOME EARNED IN EXCESS OF THE INTERNAL REVENUE SERVICE CODE SECTION 401(A)(17) RECOGNIZABLE PAY LIMITS (A DEFINED CONTRIBUTION RESTORATION PLAN). VESTING FOR THIS PLAN IS ACHIEVED AT AGE 55 AND 10 YEARS OF SERVICE OR AT AGE 65 AND 5 YEARS OF SERVICE. THE SECOND SUPPLEMENTAL DEFINED CONTRIBUTION PLAN PROVIDES ADDITIONAL RETIREMENT INCOME BASED ON A PERCENTAGE OF BASE SALARY AND VESTS AT THREE AND FIVE YEARS OF SERVICE. MR. HART VESTED AND RECEIVED $34,810 FROM A SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN IN 2016. MR. DICKMANN VESTED AND RECEIVED $19,081 FROM A SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN IN 2016. MICHAEL P GALLAGHER AND RANDALL L STUART ARE EMPLOYEES OF SANTAFE HEALTHCARE, INC., A RELATED SUPPORTING ORGANIZATION. THEY PARTICIPATE IN TWO NONQUALIFIED DEFERRED COMPENSATION RETIREMENT PLANS SPONSORED BY SANTAFE HEALTHCARE, INC. FOR A CERTAIN GROUP OF EXECUTIVES. ONE PLAN RESTORES RETIREMENT BENEFITS EQUIVALENT TO QUALIFIED 401(K) BENEFITS ON INCOME EARNED IN EXCESS OF THE INTERNAL REVENUE SERVICE CODE SECTION 401(A)(17) RECOGNIZABLE PAY LIMITS (A DEFINED CONTRIBUTION RESTORATION PLAN). VESTING FOR THIS PLAN IS ACHIEVED AT AGE 55 AND 10 YEARS OF SERVICE OR AT AGE 65 AND 5 YEARS OF SERVICE. THE SECOND SUPPLEMENTAL DEFINED CONTRIBUTION PLAN PROVIDES ADDITIONAL RETIREMENT INCOME BASED ON A PERCENTAGE OF BASE SALARY AND VESTS AT THREE AND FIVE YEARS OF SERVICE. MR. GALLAGHER VESTED AND RECEIVED $412,933 FROM SUPPLEMENTAL NONQUALIFIED RETIREMENT PLANS IN 2016. MR. STUART VESTED AND RECEIVED $99,418 FROM A SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN IN 2016. CATHERINE E AYERS AND STEVEN M ZIEGLER ARE EMPLOYEES OF AVMED, INC., A RELATED TAX-EXEMPT ORGANIZATION. THEY PARTICIPATE IN TWO NONQUALIFIED DEFERRED COMPENSATION RETIREMENT PLANS SPONSORED BY AVMED, INC. FOR A CERTAIN GROUP OF EXECUTIVES. ONE PLAN RESTORES RETIREMENT BENEFITS EQUIVALENT TO QUALIFIED 401(K) BENEFITS ON INCOME EARNED IN EXCESS OF THE INTERNAL REVENUE SERVICE CODE SECTION 401(A)(17) RECOGNIZABLE PAY LIMITS (A DEFINED CONTRIBUTION RESTORATION PLAN). VESTING IS ACHIEVED AT AGE 55 AND 10 YEARS OF SERVICE OR AT AGE 65 AND 5 YEARS OF SERVICE. THE SECOND SUPPLEMENTAL DEFINED CONTRIBUTION PLAN PROVIDES ADDITIONAL RETIREMENT INCOME BASED ON A PERCENTAGE OF BASE SALARY AND VESTS AT THREE AND FIVE YEARS OF SERVICE. MS. AYERS VESTED AND RECEIVED $99,898 FROM SUPPLEMENTAL NONQUALIFIED RETIREMENT PLANS IN 2016. MR. ZIEGLER VESTED AND RECEIVED $72,945 FROM A SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN IN 2016. SCHEDULE J, PART II: CERTAIN SENIOR EXECUTIVES ARE ACCOUNTABLE FOR AND PERFORM SERVICES FOR SANTAFE HEALTHCARE, INC. AND EACH OF ITS AFFILIATES. SANTAFE HEALTHCARE, INC. AND AFFILIATES REPRESENT A DIVERSIFIED FAMILY OF NOT-FOR-PROFIT ORGANIZATIONS WITH $2 BILLION IN GROSS RECEIPTS AND APPROXIMATELY 2,200 EMPLOYEES. THESE SENIOR EXECUTIVES ARE PAID DIRECTLY BY EITHER SANTAFE HEALTHCARE, INC. OR AVMED, INC. AND THEIR COMPENSATION AND BENEFITS ARE APPORTIONED AND CHARGED TO THE RESPECTIVE AFFILIATE BASED ON THE ESTIMATED AMOUNT OF TIME SPENT ON EACH AFFILIATE'S ACTIVITIES. FOR 2016, THE FOLLOWING PERCENTAGES OF EACH EXECUTIVE'S COMPENSATION AND BENEFITS (FOR THOSE SENIOR EXECUTIVES PAID BY A RELATED ORGANIZATION) ARE APPORTIONED AND CHARGED TO SANTAFE SENIOR LIVING, INC. AS FOLLOWS: 11% - MICHAEL P GALLAGHER, CHIEF EXECUTIVE OFFICER 3% - RANDALL L STUART, ASSISTANT TREASURER 4% - CATHERINE E AYERS, ASSISTANT SECRETARY 13% - STEVEN M ZIEGLER, ASSISTANT SECRETARY TROY HART IS PAID DIRECTLY BY SANTAFE SENIOR LIVING, INC. NONE OF HIS COMPENSATION AND BENEFITS ARE APPORTIONED AND CHARGED TO OTHER AFFILIATES. FORM 990, PART VI, SECTION A, LINE 7A SANTAFE SENIOR LIVING, INC.'S ARTICLES OF INCORPORATION AND BYLAWS STATE THAT THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS SHALL CONSTITUTE THE ORGANIZATION'S BOARD OF DIRECTORS. FORM 990, PART VI, SECTION A, LINE 7B THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS CONSTITUTES THE ORGANIZATION'S BOARD OF DIRECTORS, WHICH MAKES ALL GOVERNANCE DECISIONS OF THE ORGANIZATION. THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS HAS THE POWER AND AUTHORITY TO ESTABLISH COMMITTEES, TO ELECT AND REMOVE OFFICERS, TO APPROVE AMENDMENTS OF THE ORGANIZATION'S GOVERNING DOCUMENTS, AND TO MODIFY, AMEND, RESCIND, OR REPEAL ANY ACTION TAKEN BY THE ORGANIZATION'S BOARD OF DIRECTORS. FORM 990, PART VI, SECTION B, LINE 11B THE ORGANIZATION'S PROCESS FOR ENSURING THE ACCURATE PREPARATION, REVIEW AND APPROVAL OF THE 2016 FORM 990 BEGAN WITH PROFESSIONAL DEVELOPMENT OF STAFF (SEVERAL OF WHICH ARE CPAS) WHICH WERE INVOLVED IN THE PREPARATION OF THE 2016 FORM 990. IN ADDITION TO STAFF DEVELOPMENT, WHICH INCLUDED ATTENDING TAX SEMINARS AND CLASSES, MANAGEMENT ALSO CONSULTED WITH INDEPENDENT ACCOUNTING FIRMS AND TAX LEGAL COUNSEL REGARDING THE IRS FORM 990 CODE AND FILING REQUIREMENTS. THE ORGANIZATION ALSO PREVIOUSLY EDUCATED ITS MANAGEMENT TEAM, OFFICERS AND DIRECTORS, WITH THE ASSISTANCE OF PRICEWATERHOUSECOOPERS LLP, REGARDING THE FORM 990 AND THEIR INVOLVEMENT IN REVIEWING THE RETURN. FOLLOWING MANAGEMENT'S PREPARATION OF THE 2016 FORM 990, PRICEWATERHOUSECOOPERS, LLP REVIEWED THE 2016 FORM 990. A COPY OF THE 2016 FORM 990 AND ATTACHMENTS WERE PROVIDED TO THE ORGANIZATION'S CURRENT BOARD OF DIRECTORS FOR THEIR REVIEW AND COMMENT. EXECUTIVE MANAGEMENT ADDRESSED ANY QUESTIONS RAISED BY THE BOARD MEMBERS PRIOR TO FILING THE 2016 FORM 990 AND ATTACHMENTS WITH THE IRS. FORM 990, PART VI, SECTION B, LINE 12C SANTAFE SENIOR LIVING, INC. HAS A PROCEDURE FOR MONITORING AND ENFORCING COMPLIANCE WITH ITS CORPORATE CONFLICT OF INTEREST POLICY (POLICY). EACH COVERED PERSON SHALL RECEIVE A COPY OF THE POLICY FOR REVIEW, SUBMIT AN AFFIRMATION, AND COMPLETE A QUESTIONNAIRE WHICH IS ATTACHED TO THE CODE OF ETHICAL BUSINESS CONDUCT. THE PROCEDURE DETAILS THAT THE CORPORATE SECRETARY HAS RESPONSIBILITY FOR DELIVERY OF THE POLICY TO DIRECTORS AND OFFICERS AND RECEIPT OF THEIR AFFIRMATIONS AND QUESTIONNAIRES. THE HUMAN RESOURCES DEPARTMENT SHALL OBTAIN THE AFFIRMATION AND QUESTIONNAIRE FROM EVERY NEW EMPLOYEE AT ORIENTATION AND FROM ALL EMPLOYEES ANNUALLY. MEMBERS OF CORPORATE ADVISORY BOARDS SUBMIT THE AFFIRMATION AND QUESTIONNAIRE TO THE CHIEF COMPLIANCE OFFICER. ANNUAL CONFLICT OF INTEREST STATEMENTS ARE REVIEWED BY INTERNAL STAFF TO ENSURE RECORDS ARE COMPLETE. AS PART OF THE CORPORATE CONTRACT REVIEW PROCESS, CONSIDERATION IS GIVEN TO ANY POTENTIAL CONFLICTS OF INTEREST INVOLVING OPERATIONAL OR FINANCIAL TRANSACTIONS. ALL EMPLOYEES ARE EXPECTED TO DISCLOSE ANY POTENTIAL OR ACTUAL CONFLICT. INITIAL REVIEW OF EMPLOYEE QUESTIONNAIRES WILL BE PERFORMED BY THE HUMAN RESOURCES DEPARTMENT WITH REVIEW OF ANY DISCLOSURES BY THE CHIEF COMPLIANCE OFFICER WHO WILL EVALUATE, MAKE NECESSARY INQUIRIES, AND INVESTIGATE ALTERNATIVES. BOARD MEMBERS SHALL DISCLOSE ANY POTENTIAL OR ACTUAL CONFLICT TO THE CHAIRMAN OF THE SANTAFE HEALTHCARE, INC. BOARD, AND THE CHAIRMAN OR CHIEF COMPLIANCE OFFICER SHALL EVALUATE CONFLICT DISCLOSURES AND, IF APPROPRIATE, INVESTIGATE ALTERNATIVES AND REPORT TO DISINTERESTED BOARD MEMBERS FOR RESOLUTION. THE MINUTES OF THE BOARD OR ANY COMMITTEE MEETING AT WHICH A POTENTIAL OR ACTUAL CONFLICT OF INTEREST IS DISCLOSED OR DISCUSSED SHALL REFLECT THE NAME OF THE INTERESTED PARTY, THE NATURE OF THE CONFLICT, THE DELIBERATIONS AND THE RESOLUTION OF THE CONFLICT. IF IT IS DETERMINED THAT A COVERED PERSON HAS FAILED TO COMPLY WITH THE POLICY, THE CHIEF COMPLIANCE OFFICER OR THE CHAIRMAN SHALL TAKE APPROPRIATE ACTION, WHICH MAY INCLUDE REMOVAL FROM OFFICE OR TERMINATION OF EMPLOYMENT. FORM 990, PART VI, SECTION B, LINE 15 LINE 15A: MICHAEL P GALLAGHER IS THE CHIEF EXECUTIVE OFFICER (CEO) OF SANTAFE SENIOR LIVING, INC. MR. GALLAGHER IS COMPENSATED BY SANTAFE HEALTHCARE, INC., A RELATED SUPPORTING ORGANIZATION. SANTAFE HEALTHCARE, INC. UTILIZES THE FOLLOWING PROCESS TO ESTABLISH THE CEO'S COMPENSATION AND BENEFITS: THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS ANNUALLY RETAINS AN INDEPENDENT THIRD PARTY COMPENSATION AND BENEFITS CONSULTING FIRM TO CONDUCT A MARKET COMPETITIVENESS REVIEW OF THE CEO'S TOTAL DIRECT COMPENSATION (BASE SALARY, ANNUAL INCENTIVES, AND LONG TERM INCENTIVES) AND BENEFITS. THE COMPETITIVE ANALYSIS INCLUDES COMPARISON TO SIMILAR POSITIONS IN COMPANIES OF SIMILAR SIZE WITHIN THE SAME OR SIMILAR INDUSTRY. THE INDEPENDENT CONSULTING FIRM MAKES RECOMMENDATIONS, IF ANY, DIRECTLY TO THE BOARD OF DIRECTORS. THE BOARD OF DIRECTORS ESTABLISHES THE FINAL COMPENSATION AND BENEFIT PACKAGE FOR THE CEO TAKING INTO CONSIDERATION THE MARKET COMPETITIVENESS REVIEW AND FINAL RECOMMENDATION OF THE INDEPENDENT CONSULTING FIRM. THE INDEPENDENT CONSULTING FIRM PROVIDES AN OPINION LETTER REGARDING THE REASONABLENESS OF THE FINAL COMPENSATION AND BENEFITS PACKAGE. THE ACTIONS OF THE BOARD ARE DOCUMENTED IN THE MINUTES OF THE BOARD MEETING. FORM 990, PART VI, SECTION B, LINE 15B: PROCESS FOR DETERMINING COMPENSATION FOR OTHER LISTED PERSONS OF SENIOR LIVING IS AS FOLLOWS: THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS ANNUALLY RETAINS AN INDEPENDENT THIRD PARTY COMPENSATION AND BENEFITS FIRM (FIRM) TO CONDUCT A MARKET COMPETITIVENESS REVIEW OF ALL NON-DIRECTOR OFFICERS AND KEY EMPLOYEES' TOTAL DIRECT COMPENSATION (BASE SALARY, ANNUAL INCENTIVES, AND LONG TERM INCENTIVES) AND BENEFITS. THE COMPETITIVE ANALYSIS INCLUDES COMPARISONS TO SIMILAR POSITIONS IN COMPANIES OF SIMILAR SIZE WITHIN THE SAME OR SIMILAR INDUSTRY. AFTER COMPLETION OF ITS REVIEW, THE FIRM MAKES RECOMMENDATIONS, IF ANY, DIRECTLY TO THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS. THE FIRM PROVIDES AN OPINION LETTER REGARDING THE REASONABLENESS OF CASH COMPENSATION AND EXECUTIVE BENEFITS. THE ACTIONS OF THE BOARD ARE DOCUMENTED IN THE MINUTES OF THE BOARD MEETING. THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS ANNUALLY RETAINS AN INDEPENDENT THIRD PARTY CONSULTANT TO CONDUCT A MARKET COMPETITIVENESS REVIEW OF THE BOARD OF DIRECTORS' (INCLUDING OFFICER POSITIONS) COMPENSATION. THE COMPETITIVENESS ANALYSIS INCLUDES COMPARISONS TO BOTH NOT-FOR-PROFIT AND PUBLIC COMPANY (EXCLUDING EQUITY COMPONENT) DATA FOR COMPANIES WITHIN THE SAME OR SIMILAR INDUSTRY. ANY COMPENSATION CHANGES ARE APPROVED BY THE SANTAFE HEALTHCARE, INC. BOARD OF DIRECTORS BASED ON THE MARKET COMPETITIVENESS STUDY. A MARKET COMPETITIVENESS STUDY WAS CONDUCTED IN NOVEMBER 2016 FOR CHANGES MADE EFFECTIVE JANUARY 1, 2017. FORM 990, PART VI, SECTION C, LINE 19 SANTAFE SENIOR LIVING, INC.'S PROCEDURE FOR MAKING VARIOUS DOCUMENTS AVAILABLE TO THE PUBLIC: SANTAFE SENIOR LIVING, INC. MAKES ITS GOVERNING DOCUMENTS AVAILABLE TO THE PUBLIC ON A CASE BY CASE BASIS IF REQUESTED DIRECTLY FROM THE ORGANIZATION. THE ARTICLES OF INCORPORATION CAN BE ACCESSED DIRECTLY THROUGH THE FLORIDA DEPARTMENT OF STATE, DIVISION OF CORPORATIONS WEBSITE AT WWW.SUNBIZ.ORG. THE CORPORATE BYLAWS, CONFLICT OF INTEREST POLICY AND AUDITED COMBINED FINANCIAL STATEMENTS, WHICH INCLUDE SANTAFE SENIOR LIVING,INC., CAN BE OBTAINED DIRECTLY FROM THE ORGANIZATION UPON WRITTEN REQUEST. FORM 990, PART VII, SECTION A, LINE 1A: COMPENSATION PAID BY RELATED ORGANIZATIONS: CERTAIN SENIOR EXECUTIVES ARE ACCOUNTABLE FOR AND PERFORM SERVICES FOR SANTAFE HEALTHCARE, INC. AND EACH OF ITS AFFILIATES. SANTAFE HEALTHCARE, INC. AND AFFILIATES REPRESENT A DIVERSIFIED FAMILY OF NOT-FOR-PROFIT ORGANIZATIONS WITH $2 BILLION IN GROSS RECEIPTS AND APPROXIMATELY 2,200 EMPLOYEES. THESE SENIOR EXECUTIVES ARE PAID DIRECTLY BY EITHER SANTAFE HEALTHCARE, INC. OR AVMED, INC. AND BENEFITS ARE APPORTIONED AND CHARGED TO THE RESPECTIVE AFFILIATE BASED ON THE ESTIMATED AMOUNT OF TIME SPENT ON EACH AFFILIATE'S ACTIVITIES. FOR 2016, THE FOLLOWING PERCENTAGES OF EACH EXECUTIVE'S COMPENSATION AND BENEFITS (FOR THOSE SENIOR EXECUTIVES PAID BY A RELATED ORGANIZATION) ARE APPORTIONED AND CHARGED TO SANTAFE SENIOR LIVING, INC. AS FOLLOWS: 11% - MICHAEL P GALLAGHER, CHIEF EXECUTIVE OFFICER 3% - RANDALL L STUART, ASSISTANT TREASURER 4% - CATHERINE E AYERS, ASSISTANT SECRETARY 13% - STEVEN M ZIEGLER, ASSISTANT SECRETARY TROY HART IS PAID DIRECTLY BY SANTAFE SENIOR LIVING, INC. NONE OF HIS COMPENSATION AND BENEFITS ARE APPORTIONED AND CHARGED TO OTHER AFFILIATES. FORM 990, PART XII, LINE 2C: THE COMPANY'S AUDIT COMMITTEE HAS NOT CHANGED ITS PROCESS FOR SELECTION OF THE INDEPENDENT ACCOUNTANT OR ITS PROCESS FOR MANAGING THE AUDIT. SANTAFE HEALTHCARE INC PO BOX 749 GAINESVILLE FL 326270749 592317607 MANAGEMENT AND FINANCIAL SUPPORT FOR NOT-FOR-PROFIT AFFILIATES FL 501(C)(3) 12B TYPE II N/A 0 NORTH FLORIDA RETIREMENT VILLAGE INC PO BOX 749 GAINESVILLE FL 326270749 591912330 RETIREMENT COMMUNITY FL 501(C)(3) 10 SANTAFE HEALTHCARE INC 0 NORTH CENTRAL FLORIDA HOSPICE INC PO BOX 749 GAINESVILLE FL 326270749 592490893 HOSPICE CARE FL 501(C)(3) 10 SANTAFE HEALTHCARE INC 0 BVG ACQUISITION INC PO BOX 749 GAINESVILLE FL 326270749 203701186 RETIREMENT COMMUNITY FL 501(C)(3) 10 SANTAFE HEALTHCARE INC 0 EAST RIDGE RETIREMENT VILLAGE INC PO BOX 749 GAINESVILLE FL 326270749 590903331 RETIREMENT COMMUNITY FL 501(C)(3) 10 SANTAFE HEALTHCARE INC 0 AVMED INC PO BOX 749 GAINESVILLE FL 326270749 592742907 HEALTH CARE FL 501(C)(4) N/A SANTAFE HEALTHCARE INC 0 BONITA SPRINGS RETIREMENT VILLAGE INC PO BOX 749 GAINESVILLE FL 326270749 262386152 RETIREMENT COMMUNITY FL 501(C)(3) 10 SANTAFE HEALTHCARE INC 0 SANTAFE SENIOR LIVING FOUNDATION INC PO BOX 749 GAINESVILLE FL 326270749 264464727 CHARITABLE AND EDUCATIONAL PURPOSES FL 501(C)(3) 7 SANTAFE HEALTHCARE INC 0 HOSPICE OF THE FLORIDA KEYS INC PO BOX 749 GAINESVILLE FL 326270749 592386289 HOSPICE CARE & HOME HEALTH CARE FL 501(C)(3) 7 SANTAFE HEALTHCARE INC 0 SF HOLDING CORPINC PO BOX 749 GAINESVILLE FL 326270749 592903901 HOLDING COMPANY FL SANTAFE HEALTHCARE INC C 0 0 0 0 1 0 0 0 0 0 0 0 1 1 1 0 1 1 1 1