THE BAPTIST HEALTH SYSTEM, INC. RETIREMENT PLAN PLAN SUMMARY. As of October 1, 2015

Transcription

1 THE BAPTIST HEALTH SYSTEM, INC. RETIREMENT PLAN PLAN SUMMARY As of October 1,

2 TABLE OF CONTENTS SECTION 1 - INTRODUCTION... 1 SECTION 2 - GENERAL INFORMATION... 1 SECTION 3 - DEFINITIONS... 2 SECTION 4 - PARTICIPATION... 4 SECTION 5 - REHIRED EMPLOYEES; SERVICE WITH AN AFFILIATE... 4 SECTION 6 - RETIREMENT BENEFIT... 5 SECTION 7 - EARLY RETIREMENT BENEFIT... 6 SECTION 8 - DISABILITY BENEFIT... 7 SECTION 9 - TERMINATION BENEFIT... 8 SECTION 10 - DEATH BENEFIT... 8 SECTION 11 - CONTRIBUTIONS... 9 SECTION 12 - PAYMENT OF BENEFITS... 9 SECTION 13 - CLAIMS FOR BENEFITS SECTION 14 - APPEAL OF A CLAIM SECTION 15 - MISCELLANEOUS i

3 THE BAPTIST HEALTH SYSTEM, INC. RETIREMENT PLAN PLAN SUMMARY SECTION 1 INTRODUCTION Baptist Health System, Inc. ("BHS") has maintained and sponsored The Baptist Health System, Inc. Retirement Plan (the "Plan"), a qualified retirement plan, for the purpose of providing Participants and their Beneficiaries with benefits in the event of the Participant's retirement, death, disability or other termination of employment. BHS last amended and restated the Plan as of January 1, 2014, and it has been amended three times since then. The Plan was frozen on December 31, 2005; accordingly, no benefits have accrued since that date, and no Employee has or could become eligible after that date. This Plan Summary summarizes the major provisions of the Plan that apply generally to all Participants, but does not contain many of the "grandfathered" provisions that apply to limited numbers of Participants. The actual Plan document is maintained in the BHS Corporate Benefits Department and may be examined by a Participant, Beneficiary and their legal representatives. BHS intends that this Plan Summary will be accurate, while, at the same time, written in a manner to be easily understood. This Plan Summary is only a summary of the Plan documents and, necessarily, does not reflect all of the provisions of the Plan. IF THERE IS ANY CONFLICT BETWEEN THE PROVISIONS OF THIS BOOKLET AND THE PROVISIONS OF THE PLAN, THE PROVISIONS OF THE PLAN WILL CONTROL. SECTION 2 GENERAL INFORMATION NAME OF PLAN: EMPLOYER: EFFECTIVE DATE: EMPLOYER IDENTIFICATION NUMBER: The Baptist Health System, Inc. Retirement Plan Baptist Health System, Inc nd Street South, Suite 1000 Birmingham, Alabama (205) This Summary is based on the Plan as amended and restated generally as of January 1, 2014 and through Amendment Three. The original effective date of the Plan is July 1, PLAN NUMBER: 001 TYPE OF PLAN: CHURCH PLAN: PLAN YEAR: PLAN ADMINISTRATOR: The Plan is a traditional pension plan, which is a type of benefit plan more formally called a qualified defined benefit plan. The Plan is a non-electing church plan. The Plan Year begins on January 1st and ends on December 31st. The records of the Plan are kept on this basis. The Baptist Health System, Inc. Benefits Committee is the Plan Administrator. The Benefits Committee may contract with third parties to provide certain administrative services to the Plan. The Benefits Committee is also the Plan's appointed agent for service of Page 1 of 13

4 legal process. The Benefits Committee's address and telephone number are: Baptist Health System, Inc. Benefits Committee c/o Corporate Benefits Department Baptist Health System, Inc nd Street South, Suite 1000 Birmingham, Alabama (205) PENSION CENTER: TRUSTEE: TRUST FUND: Baptist Health System Pension Center PO Box 380 Lincolnshire, IL (877) State Street Corporation Specialized Trust Services 4655 Salisburg Road Jacksonville, FL The Plan is funded through the Baptist Health System, Inc. Retirement Plan Trust and the assets thereof are held by the Trustee. In addition, the Benefits for certain Participants who were employed by Walker Regional Medical Center are funded by Provident Life and Accident Insurance Company (UNUM) Annuity Contract No SECTION 3 DEFINITIONS Words and phrases that are capitalized in this Plan Summary are defined in the Plan document. Some of them are identified in Section 2 or summarized below. 3.1 ACCRUED BENEFIT. A Participant s Benefit determined as of December 31, Effective December 31, 2005, the Plan became a frozen plan, which means that a Participant could not accrue any additional benefits under the Plan after that date. BHS has calculated the Accrued Benefit for Participants based on their Compensation and Years of Credited Service before January 1, BENEFICIARY. The party (or parties) entitled to receive a Participant's Death Benefit. A Participant has the right to designate one or more primary and contingent Beneficiaries to receive his Death Benefit. If the Participant is not married, he can name anyone as his Beneficiary. If married, he must name his spouse as his only primary Beneficiary unless his spouse cannot be located or consents in writing before a notary public to the designation of another Beneficiary. If a Participant does not designate a Beneficiary or all of the Beneficiaries die before the Participant, the Death Benefit will be paid to the Participant's surviving spouse or, if he does not have a surviving spouse, to his estate. Subject to these restrictions, a Participant can change his designated Beneficiary at any time in writing on a form provided by the BHS Pension Center. The term spouse and/or surviving spouse shall refer only to a Participant s spouse or surviving spouse of the opposite sex, except as otherwise required by the terms of the Plan and/or federal law. 3.3 BENEFIT. The Normal Retirement Benefit, Early Retirement Benefit, Disability Benefit, Death Benefit, or Termination Benefit. 3.4 BREAK IN SERVICE. A Plan Year during which a Participant is credited with fewer than 501 Hours of Service Page 2 of 13

5 3.5 COMPENSATION. For a Plan Year, the wages and salary (including overtime payments, bonuses, commissions, and other monetary remuneration) paid by BHS to a Participant during the Plan Year, plus elective contributions under Code 402(g)(3) and deferrals excluded from gross income under Code 125, Code 132(f)(4) or Code 457, but excluding any BHS contributions to a deferred compensation plan (if not includable in gross income), distributions from any deferred compensation plan, amounts related to stock options and Code 83 property, and other amounts receiving special tax benefits. Compensation for a Plan Year cannot exceed $200,000 (as adjusted for inflation by the IRS). In 2005, the Compensation limit was $210,000. Due to the freeze of this Plan, no Compensation earned after December 31, 2005 is taken into account under the Plan. 3.6 DEFERRED BENEFIT. The Deferred Benefit is the Normal Retirement Benefit a Participant would be entitled to at age 65. See Section 6.1 for additional details. Due to the freeze of this Plan, no additional Years of Credited Service will be applied in calculating a Participant s Normal Retirement Benefit as of December 31, If your employment terminated after 2005, your Deferred Benefit is your Normal Retirement Benefit (see Section 6.2) based on your Years of Credited Service and Final Average Annual Compensation as of December 31, 2005, and the Social Security Taxable Wage Base for ELIGIBLE EMPLOYEE. Any Employee except those who fall within one of these categories: a Flexipool Employee, a medical resident, or a rehired Employee who received his Benefit from the Plan following an earlier severance from service. Due to the freeze of this Plan, no one can become a Participant in the Plan after EMPLOYEE. An individual treated as a common law employee of BHS on BHS's payroll records is an Employee, as is a hospital chaplain. An individual treated or classified by BHS as a Leased Employee, consultant, independent contractor, or other non-employee, even if it is later determined by a court, governmental agency, or by anyone, that the individual should have been treated as an Employee, is not an Employee. 3.9 FINAL AVERAGE ANNUAL COMPENSATION. The highest average amount of a Participant's annual Compensation for five calendar years in a row (out of the last ten full calendar years of employment in a row). Any calendar years that a Participant receives no pay from BHS or works less than 1,000 Hours of Service are not included. The year you terminate employment is not counted unless you work to December 31 st. Due to the freeze of this Plan, no Compensation earned after December 31, 2005 is taken into account under the Plan FLEXIPOOL EMPLOYEE. An Employee who is classified as a Flexipool Employee by a specified job code, work status code, or other applicable code in the Employer s payroll records HOUR OF SERVICE. Each hour for which an Eligible Employee is paid or entitled to be paid for work performed for BHS. No more than 501 hours shall be counted as Hours of Service on account of a period during which the employee performs no duties for BHS due to vacation, holiday, illness, incapacity, layoff, jury duty, or a Leave of Absence. If BHS does not keep a record of an Employee's actual Hours of Service, he will be credited with forty-five Hours of Service for each week for which he receives credit for at least one Hour of Service. In addition, he may receive credit for up to 501 Hours of Service for any period he was absent from work for certain maternity or paternity purposes but these Hours of Service are counted only for purposes of preventing a Break in Service PARTICIPANT. An Eligible Employee who became a Participant as explained in Section 4, and any former Eligible Employee who has a vested Accrued Benefit in the Plan. Since the Plan was frozen on December 31, 2005, no Employee can become a Participant in the Plan after that date. If you were a Participant in the Plan prior to December 31, 2005, you will continue to be a Participant until your Accrued Benefit is distributed, though you will not accrue any additional benefits after December 31, PRERETIREMENT SURVIVOR ANNUITY. A monthly annuity paid for the life of the Participant's Beneficiary equal to the survivor portion of a Qualified 50% Joint and Survivor Annuity Page 3 of 13

6 3.14 QUALIFIED 50% JOINT AND SURVIVOR ANNUITY. A monthly annuity paid for the life of a Participant followed by a monthly annuity paid for the life of the Participant's surviving spouse, if one, equal to 50% of the monthly payment that was being paid to the Participant YEAR OF CREDITED SERVICE. A Plan Year during which a Participant completes at least 1,000 Hours of Service prior to January 1, Service with certain acquired companies may count as a Year of Credited Service. No Participant will accrue any additional Years of Credited Service after December 31, YEAR OF VESTING SERVICE. A Plan Year during which an Eligible Employee completes at least 1,000 Hours of Service. Service with certain BHS-related companies counts. SECTION 4 - PARTICIPATION 4.1 DATE OF PARTICIPATION. You were covered by the Plan on the date you became a "Participant." The following rules applied in order for you to have become a Participant. (a) If you worked at least 1,000 hours during your first year of employment, you became a Participant on the first anniversary of your Employment Date. (b) If you worked less than 1,000 hours during the first year of employment, you became a Participant on the January 1 following the first calendar year during which you worked at least 1,000 hours. Service with certain BHS-related companies counted for this purpose. You must have been employed by BHS on the date described above in order to have become a Participant. Since the Plan was frozen on December 31, 2005, no Employee can become a Participant in the Plan after that date. If you were a Participant in the Plan prior to December 31, 2005, you will continue to be a Participant until your Accrued Benefit is distributed, though you will not accrue any additional benefits after December 31, WHEN YOUR PARTICIPATION ENDS. Your status as a Participant will end on the date your entire Accrued Benefit is distributed to you from the Plan. SECTION 5 REHIRED EMPLOYEES; SERVICE WITH AN AFFILIATE 5.1 REHIRE AFTER FULL PAYMENT. If you are re-employed after your Benefit is paid out in a lump sum payment, you will not be a Participant in the Plan following your rehire. 5.2 REHIRE AFTER PARTIAL PAYMENT. If you are receiving monthly retirement payments following early or normal retirement, and you are rehired as a full-time employee, your benefit payments will cease during re-employment. The Benefit payable upon your subsequent severance from employment shall be reduced to reflect the Benefit which had been paid prior to your re-employment date. A Participant who participated in the Walker Baptist Medical Center, Inc. Pension Plan on or before April 30, 1997 (who was employed prior to May 1, 1984) may continue to receive his Normal Retirement Benefit upon rehire as a full-time employee (subject to approval by the Internal Revenue Service). 5.3 REHIRE AS FLEXIPOOL OR PART-TIME EMPLOYEE. Generally, if you are receiving monthly retirement payments following early or normal retirement and you are rehired as a Flexipool or part-time employee, your retirement payments may continue to be paid. 5.4 SERVICE WITH AN AFFILIATE. If you worked for BHS, and you transferred employment to Baptist Health Centers, Inc. ( BHC ) or another affiliate, or you terminated employment with BHS and then later were hired by BHC or another affiliate, your later service with the other company may have counted for vesting purposes under the Plan. Similarly, if you worked for BHC or another affiliate and you transferred employment Page 4 of 13

7 to BHS prior to 2006, your prior service with BHC or the affiliate may have counted for vesting or participation purposes. To have an Accrued Benefit under the Plan, though, you must have worked for BHS or a participating employer at some point in your career and have at least one Year of Credited Service (BHC is not a participating employer and service with BHC does not count as credited service). Due to the freeze of this Plan, service after 2005 with any employer is not taken into account for any purpose other than determining whether a Participant qualifies for certain special retirement provisions. SECTION 6 - RETIREMENT BENEFIT 6.1 NORMAL RETIREMENT BENEFIT. If you are a Participant and you retire at age 65 or older, you may elect to receive a Normal Retirement Benefit. 6.2 AMOUNT OF NORMAL RETIREMENT BENEFIT. Your Normal Retirement Benefit will be a monthly payment that will depend on your Final Average Annual Compensation and Years of Credited Service. CALCULATION OF YOUR NORMAL (AGE 65) RETIREMENT BENEFIT If you terminated employment with BHS in 2005 or later, or you still work for BHS, and your Final Average Annual Compensation is equal to or less than 25% of the Social Security Taxable Wage Base for 2005 (for 2005, 25% of the Social Security Taxable Wage Base = $22,500), your monthly Normal Retirement Benefit is computed as follows: STEP 1: Multiply your Final Average Annual Compensation by.0085 STEP 2: STEP 3: Multiply the result in STEP 1 by your Years of Credited Service up to 35 years Divide the result in STEP 2 by 12. This amount is your monthly Retirement benefit. If you terminated employment with BHS in 2005 or later, or you still work for BHS, and your Final Average Annual Compensation is more than 25% of the Social Security Taxable Wage Base for 2005 (for 2005, 25% of the Taxable Wage Base = $22,500), your monthly Normal Retirement Benefit is computed as follows: STEP 1: Subtract 25% of the Taxable Wage Base for 2005 from your Final Average Annual Compensation STEP 2: Multiply the result in STEP 1 by.015 STEP 3: Add 25% of the Taxable Wage Base for 2005 MULTIPLIED BY.0085 to the result in STEP 2 STEP 4: Multiply the result in STEP 3 by your Years of Credited Service up to 35 STEP 5: NOTE: Divide the result in STEP 4 by 12. This amount is your monthly Retirement benefit. Your minimum benefit is $10.00 times your Years of Credited Service, not to exceed 5 years. If you terminated before 2005, your benefit is calculated in the manner described above using the Social Security Taxable Wage Base for the year in which you terminated. 6.3 PAYMENT OF NORMAL RETIREMENT BENEFIT. Your Normal Retirement Benefit will be paid in the form you elect as described in Section 12. Your Normal Retirement Benefit will begin to be paid as soon as practicable on or following your Normal Retirement Date. You must complete the Plan s application form in order to start your retirement payments. You may obtain the application form by contacting the BHS Pension Center. If your Normal Retirement Benefit starts on a date that is later than the month following age 65, you will receive your missed monthly payments in a lump sum (without interest) Page 5 of 13

8 6.4 SPECIAL NORMAL RETIREMENT BENEFITS. (a) Citizens Participant. A participant who participated in the Citizens Hospital Defined Benefit Plan on December 31, 1992 who has completed 25 Years of Vesting Service (including service after December 31, 2015) is eligible to receive payment of his unreduced Normal Retirement Benefit on or after age 60. If the participant was employed by BHS on October 2, 2015, the participant is eligible to receive payment of his unreduced Normal Retirement Benefit on or after age 60 regardless of Years of Vesting Service. (b) Walker Baptist Medical Center, Inc. Pension Plan Participant. A Participant who participated in the Walker Baptist Medical Center, Inc. Pension Plan (the Walker Pension Plan ) on May 1, 1997 who was employed by Walker Baptist Medical Center prior to May 1, 1984, may elect to retire on or after attaining the age of 60 with 10 years of elapsed time from year of hire, or after 30 years of elapsed time from year of hire. In addition, a Participant who was a participant in the Walker Pension Plan on or before April 30, 1997 (and employed prior to May 1, 1984) may elect to commence his Normal Retirement Benefit while still employed by BHS. SECTION 7 - EARLY RETIREMENT BENEFIT 7.1 EARLY RETIREMENT BENEFIT. If you retire at age 55 or later, but before age 65, you may elect to receive an Early Retirement Benefit. It will be based on your Deferred Benefit and the applicable Early Retirement Factor. 7.2 DEFERRED BENEFIT. Your Deferred Benefit is your Accrued Benefit on December 31, Through December 31, 2005, your Deferred Benefit amount was computed by multiplying: STEP 1: STEP 2: Your Normal Retirement Benefit (as if you worked until age 65) by The Fraction: Your actual Years of Credited Service Your Years of Credited Service (as if you worked until age 65) After 2005, your Deferred Benefit is your Normal Retirement Benefit (see Section 6.2) based on your Years of Credited Service and your Final Average Annual Compensation as of December 31, 2005, and the Social Security Taxable Wage Base for AMOUNT OF EARLY RETIREMENT BENEFIT. Your Early Retirement Benefit will be a monthly payment equal to the greater of: (1) your Deferred Benefit on the date you retire (as computed above) multiplied by the applicable Early Retirement Factor, or (2) $10.00 times your Years of Credited Service, not to exceed 5 years. 7.4 EARLY RETIREMENT FACTOR. The applicable Early Retirement Factor depends on your age (in years and months) when you retire. The following chart reflects the Early Retirement Factors at various ages (additional factors apply at each month following attainment of the listed ages): Page 6 of 13

9 Age Factor Age Factor PAYMENT OF EARLY RETIREMENT BENEFIT. Your Early Retirement Benefit will be paid in the form described in Section 12. Your Early Retirement Benefit will begin to be paid as soon as practicable on or following your Early Retirement Date. You must complete the Plan s application form in order to start your early retirement payments. You may obtain the application form by contacting the BHS Pension Center. SECTION 8 - DISABILITY BENEFIT 8.1 DISABILITY BENEFITS. If your employment ends before age 65 because of your Disability, you can receive a Disability Benefit. To establish Disability, you must provide a letter from the Social Security Administration stating that you are disabled. The Disability must occur after you become a Participant and while still actively employed by BHS. The Plan does not pay benefits for a disability arising from: 1. Your excessive and habitual use of intoxicants, drugs, or narcotics, 2. An intentionally self-inflicted injury or intentionally self-induced sickness, 3. An unlawful act on your part, 4. Military service where you are eligible to receive a government-sponsored military disability pension, 5. An injury or illness diagnosed or discovered after your employment ends, 6. An act of war, or 7. An injury or disease which first occurs while employed by someone other than BHS. 8.2 AMOUNT OF DISABILITY BENEFIT. Your Disability Benefit will be a monthly payment which is the Actuarial Equivalent (based on the applicable actuarial factors under the Plan) of your Normal Retirement Benefit. 8.3 PAYMENT OF DISABILITY BENEFIT. Your Disability Benefit will be paid in the form described in Section 12. The lump sum payment option is only available if your Disability Benefit is first payable after An application for a Disability Benefit must be made in writing. If you apply for your Disability Benefit during the first 6 months of your Disability, your Disability Benefit will begin on the first day of the month after you have been disabled for 6 months. If you are still disabled at that time, your Disability Benefit will be paid retroactive to the first day of your Disability. If you apply for your Disability Benefit after the first 6 months of your Disability, your Disability Benefit will begin on the date you applied Page 7 of 13

10 Your Disability Benefit will continue until you recover, if you recover prior to age 65. If you do not recover before age 65, your Disability Benefit will continue until you die. SECTION 9 - TERMINATION BENEFIT 9.1 TERMINATION BENEFIT. If your employment ends after the earlier of (1) the date you complete 5 Years of Vesting Service, or (2) December 31, 2005, for any reason other than Normal or Early Retirement, death or Disability, you may receive a Termination Benefit. 9.2 AMOUNT OF TERMINATION BENEFIT. Your Termination Benefit will be based on your Deferred Benefit (see Section 7.2) on the date your employment ends multiplied by the applicable Early Retirement Factor (see Section 7.4) on the date payment is made. 9.3 PAYMENT OF TERMINATION BENEFIT. Prior to age 55, your Termination Benefit is only available as a single sum payment as described in Section 12.1(c)(8). Upon reaching age 55, you may retire with an Early Retirement Benefit (see Section 7). Upon reaching age 65, you may retire with a Normal Retirement Benefit (see Section 6). You must complete at least 5 years of Vesting Service or you must have been a Participant in the Plan who was actively employed by BHS or an affiliate on December 31, 2005, and you must have had one or more Years of Credited Service on December 31, 2005, to be eligible for any Benefit from this Plan. SECTION 10 - DEATH BENEFIT 10.1 DEATH BENEFIT. If you die while a Participant, your Beneficiary may be entitled to receive a Death Benefit AMOUNT OF DEATH BENEFIT. If you die before any payments have been made to you from the Plan, your Beneficiary will receive a Preretirement Survivor Annuity as a Death Benefit. If you die before you reach age 65, your Death Benefit will be based on your Deferred Benefit (see Section 7.2) on the date of your death. If you die after you reach age 65, your Death Benefit will be based on the Normal Retirement Benefit available to you on the date of your death. If you die after you begin receiving payments from the Plan, your Death Benefit, if one, will be determined based on the form of retirement payments you were receiving when you died. If you die before you begin receiving payments from the Plan, the Death Benefit is a 50% joint and survivor annuity. Your Beneficiary will receive 50% of the pension you would have received if you had separated from service on the date of your death, survived to your earliest retirement date, and received an immediate 50% joint and survivor annuity on the day before your death. However, your Beneficiary may choose instead to receive your Death Benefit in a single sum payment. Note that a non-spouse Beneficiary may only receive a single sum payment and may not elect an annuity. If the Plan overpays your Benefit after your death, that is, the Plan inadvertently or mistakenly continues to issue checks payable to the Participant, the overpayments must be repaid to the Plan PAYMENT OF DEATH BENEFIT. If you die after you begin receiving payments from the Plan, payment of your Death Benefit will begin on the first day of the month after your death. Payments generally end on the first day of the month during which your Beneficiary dies, subject to the form of payment selected by you or your Beneficiary. If you die before you begin receiving payments from the Plan, your Beneficiary must request distribution of your Death Benefit by obtaining an application form from the BHS Pension Center, completing the form, and returning it to the BHS Pension Center Page 8 of 13

11 10.4 NAMING A BENEFICIARY. You have the right to name one or more Beneficiaries to receive your Death Benefit. To name a Beneficiary, you must complete a Beneficiary designation form. You can get this form from the BHS Pension Center. If you are not married, you can name anyone as your Beneficiary. If you are married, you must name your spouse as your only primary Beneficiary unless your spouse agrees in writing to your naming of another Beneficiary. Your spouse s written consent must be witnessed by a notary public, must acknowledge the effect of such consent, and must agree to the designation of the specific Beneficiary (or class of Beneficiaries) and allow any subsequent change in such Beneficiary or Beneficiaries. If you are married and your spouse cannot be located, you may name anyone else as your Beneficiary. If you do not name a Beneficiary, or if all of your Beneficiaries pre-decease you, your Death Benefit will be paid to your surviving spouse, or, if you have no surviving spouse, to your estate. You can change your Beneficiary at any time, but any change must be in writing and must be delivered to the BHS Pension Center REQUIRED DISTRIBUTION. If you die before you start your retirement payments from the Plan, your Beneficiary must commence monthly payments of your Death Benefit by the end of the calendar year following your death; otherwise, your entire Death Benefit must be distributed by the end of calendar year containing the fifth anniversary of your death. If your Beneficiary fails to take timely distributions, he or she may have to pay an excise tax on any late payments. SECTION 11 CONTRIBUTIONS BHS is responsible for paying to the Plan 100% of the amounts determined by the Plan's actuary as necessary to provide the benefits available under the Plan. All of BHS's contributions to the Plan are held by the Trustee and invested by money managers selected by BHS. You are not required or allowed to make any payments to the Plan, nor are you allowed to transfer distributions from other retirement plans and individual retirement accounts to the Plan. SECTION 12 PAYMENT OF BENEFITS 12.1 NORMAL OR EARLY RETIREMENT, DISABILITY, OR TERMINATION BENEFIT. The form in which your Normal Retirement Benefit, Early Retirement Benefit, Disability Benefit, or Termination Benefit will be paid will depend on your marital status when payment begins. (a) Normal Form of Payment for Unmarried Participants. If you are not married when payment begins, the normal form of payment is a life annuity. This form of payment provides you with a monthly income for as long as you live but payments stop when you die. (b) Normal Form of Payment for Married Participants. If you are married when payment begins, the normal form of payment is a Qualified 50% Joint and Survivor Annuity. This form of payment will provide you with a monthly income for as long as you live. If your spouse is still alive when you die, your spouse will receive a monthly income for as long as he or she lives equal to 50% of the monthly income that was being paid to you. (c) Forms of Payment. Participants may be able to elect an optional form of payment. If you are married, your spouse must agree to an optional form of payment (except as otherwise provided). The optional Page 9 of 13

12 forms of distribution described in 1. through 7. below are actuarially equivalent Benefits calculated using the UP Mortality Table and a 6% interest rate Year Certain and Life Annuity. This form of payment will provide you with a monthly income for as long as you live. If you die before you receive 60 payments (5 years of payments), your beneficiary will receive the same monthly income until a total (including payments made to you) of 60 payments have been made Year Certain and Life Annuity. This form of payment will provide you with a monthly income for as long as you live. If you die before you receive 120 payments (10 years of payments), your beneficiary will receive the same monthly income until a total (including payments made to you) of 120 payments have been made Year Certain and Life Annuity. This form of payment will provide you with a monthly income for as long as you live. If you die before you receive 180 payments (15 years of payments), your beneficiary will receive the same monthly income until a total (including payments made to you) of 180 payments have been made. 4. Joint and 50% Survivor. This form of payment will provide you with a monthly income for as long as you live. If your spouse is still alive when you die, your spouse will receive a monthly income for as long as he or she lives equal to 50% of the monthly income that was being paid to you. This option is not available to unmarried Participants. 5. Joint and 66.67% Survivor. This form of payment will provide you with a monthly income for as long as you live. If your spouse is still alive when you die, your spouse will receive a monthly income for as long as he or she lives equal to 66.67% of the monthly income that was being paid to you. This option is not available to unmarried Participants. 6. Joint and 100% Survivor. This form of payment will provide you with a monthly income for as long as you live. If your spouse is still alive when you die, your spouse will receive a monthly income for as long as he or she lives equal to 100% of the monthly income that was being paid to you. This option is not available to unmarried Participants. 7. Life Annuity. This form of payment will provide you with a monthly income for as long as you live. No payments will be made after you die. This optional form of payment is available to you, regardless of your marital status when payments commence (though your spouse s consent to this optional form is required if you are married). 8. Single Sum Payment. This form of payment will provide 100% of your benefit all at one time. This option is normally available only if the present value of your benefit, using an interest rate equal to the discount rate selected by BHS for the GAAP fiscal year-end financial disclosures for the Plan and the Unisex Mortality Table applicable in the year of payment, is not more than $10,000. Spousal consent is not required to elect a single sum payment if the Single Sum Value is less than or equal to $5,000. A single sum payment is the only form of payment of a Termination Benefit prior to age 55 (unless you are offered a lump sum window benefit). 9. Special Optional Forms. If you were a Participant in a retirement plan that merged with the Plan, you may be eligible for a special optional form of payment. i. Citizens Participant. A Participant who participated in the Citizens Hospital Defined Benefit Plan on December 31, 1992 may elect a single sum distribution calculated in the same manner as described in Section 12.1(c)(8) above, but without any age or amount limitations Page 10 of 13

13 ii. Shelby County Participant. A Participant who participated in the Shelby County Health Care Authority Defined Benefit Pension Plan on or before December 31, 1996 may elect a single sum payment calculated in the same manner as described in Section 12.1(c)(8) above, or using the actuarial assumptions stated in the Shelby County Health Care Authority Defined Benefit Pension Plan, whichever results in the greatest single sum value LATEST TIME FOR PAYMENT OF BENEFITS. Payment of the Benefit must comply with Internal Revenue Service rules on required minimum distributions both as to the amount of payment and the date of payment. In general, such distributions must begin no later than the April 1 of the calendar year immediately following the calendar year in which you (1) turn age 70 ½ or (2) actually retire, if later. Except with respect to required minimum distributions, you must request distribution of your Benefit by obtaining an application form from the BHS Pension Center, completing the form, and returning it to the BHS Pension Center. Your Benefit will not automatically be paid to you (again, except with respect to required minimum distributions); you must apply for it in order for payments to start MAXIMUM ANNUAL BENEFIT. The maximum amount of your yearly Benefit from the Plan is the lesser of (1) $195,000 (as adjusted periodically by the Internal Revenue Service) or (2) 100% of your average pay for the three years in a row that produces the highest average ROLLOVER OF SINGLE SUM PAYMENT. You may roll over a single sum payment you receive to another tax-qualified plan that accepts rollovers from defined benefit plans or an IRA to avoid paying taxes and penalties at that time. You should discuss any rollover consequences with your tax advisor before proceeding. You may not roll over a minimum required distribution (after age 70 ½) or a monthly pension payment WALKER REGIONAL MEDICAL CENTER. If you are or were employed by Walker Regional Medical Center, all or part of your Benefit may be funded by a Provident Life and Accident Insurance Company (UNUM) annuity contract. If your Benefit is funded by this annuity contract, your optional forms of payment are limited to the payment forms offered under the annuity contract. SECTION 13 - CLAIMS FOR BENEFITS To make a claim for benefits, or any other right you have under the Plan, you must contact the BHS Pension Center. They will get the information needed from you to begin the application process. Additionally, you should review the detailed claims procedures set forth in the Plan. The four steps to processing a claim for benefits are as follows: 1. The BHS Pension Center determines your Normal Retirement Benefit based on your employment history as of December 31, If you have requested calculations of an optional form of benefit as shown in Section 12 of this booklet, the BHS Pension Center will determine the amount of your payment, as well as the amount of any available single sum payment. 3. When the benefit calculations are ready, the BHS Pension Center will prepare an application form and other forms that you must sign to get your benefit payments started. 4. These forms will be sent to you. You may set up an appointment with a representative from the BHS Pension Center to go over the forms. You will decide how you want benefits paid and sign the forms. You will need appropriate spousal consent with notary (or Plan representative) witness of such consent if you are married and do not select the normal form of payment (unless you select a Single Sum Payment, where the Single Sum Value is less than or equal to $5,000) Page 11 of 13

14 Once you have signed your application forms it normally takes about six weeks before benefit payments can begin. So, in order for your retirement benefits to start when you retire, you need to contact the BHS Pension Center at least six weeks before you expect to retire or to otherwise begin your benefit payments. In most cases, the BHS Pension Center will, within 90 days after your written claim is received, provide you with notice of its decision with respect to your claim. This period may be extended for up to an additional 90 days upon notice to the Claimant. If the claim is denied in whole or in part, the BHS Pension Center will explain the specific reason or reasons for denial. If the BHS Pension Center does not notify you of its decision within 180 days, your claim is deemed denied on the 180 th day, and you may request a review of your claim pursuant to the procedure explained in Section 14. SECTION 14 - APPEAL OF A CLAIM Should you be denied a claim or any part of a claim, the denial may be appealed to the BHS Pension Center. The BHS Pension Center will give a full and fair review. Appeal must be made in writing within 60 days after a denial is received by you or deemed denied. If you do not file a timely appeal, you are treated as though you accepted the denial and no further remedy is available to you. An appeal must be in writing and be addressed to: Baptist Health System Pension Center PO Box 380 Lincolnshire, IL Your written request should include all issues and comments which you wish to have the BHS Pension Center consider in connection with your review, and may include a request to review relevant Plan documents and a request for a hearing. The review of your claim (application) by the BHS Pension Center will be on the record of the claim (application) in question and other information submitted to the BHS Pension Center by you (or your duly authorized representative). A decision will be made by the BHS Pension Center within 60 days after receipt of your written notice of appeal, unless special circumstances require an extension of time for processing. In this case, a decision should be rendered as soon as possible, but within 120 days of receipt of the appeal (or longer if a hearing is requested). You will be notified of the decision in writing or electronically. If the decision is adverse, you will be given the reasons for the denial and specific references to the Plan provisions on which the decision is based. After exhausting these claim and appeal procedures, if you are still dissatisfied you may seek further relief only pursuant to binding arbitration under the BHS Dispute Resolution Program. Note that you may not utilize the BHS Dispute Resolution Program without first exhausting these claim and appeal procedures. You must utilize these appeal procedures in order to seek review of a denial of a claim. Otherwise, the denial is a final and binding determination of your rights under the Plan. SECTION 15 - MISCELLANEOUS 15.1 FEDERAL PENSION INSURANCE. The Plan is a non-electing "church plan" under the Employee Retirement Income Security Act; therefore, it is not insured by the Pension Benefit Guaranty Corporation ASSIGNMENT OF BENEFITS. You cannot assign or otherwise transfer your Benefit. However, if the Plan Administrator receives a "qualified domestic relations order" relating to your Benefit, all or a portion of your Benefit may be paid to your spouse, former spouse, children or other dependents, as required by law Page 12 of 13

15 15.3 EFFECTS ON EMPLOYMENT. Neither the establishment of the Plan nor participation in the Plan constitutes a contract of employment. Whether or not an Employee is a Participant, an Employee will remain subject to termination as though the Plan had never been adopted AMENDMENT AND TERMINATION. BHS reserves the sole and exclusive right to amend or terminate the Plan at any time without the consent of any Participant or Beneficiary. If the Plan is terminated, you will be entitled to your Accrued Benefit to the extent your Accrued Benefit is funded CONTROLLING LAW. The Plan will be governed by the laws of the State of Alabama, except to the extent federal law applies to a non-electing church plan TAXATION OF BENEFITS. You should consult a knowledgeable tax advisor on the taxation of benefits paid from the Plan. Although BHS cannot give you tax advice, it is important for you to realize that state tax is not automatically due on pension distributions. For an Alabama resident, state taxes are generally not owed on the pension payments he or she receives from a defined benefit pension plan, and it is generally not necessary to report pension payments on an Alabama Income Tax Return. However, pension benefits generally are subject to federal taxation (unless your distribution is eligible for, and you elect, a tax-free rollover per Section 12.4), and should be reported on a Federal Income Tax Return Page 13 of 13