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Northeast Georgia Health System, Inc. and Affiliated Companies Pension Plan

Overview

Introduction The Northeast Georgia Health System, Inc. and Affiliated Companies Pension Plan (the Plan) is designed to provide a lifetime monthly income when you retire from active employment under the terms of the Plan. Certain benefits may also be provided to your surviving spouse in the event of your death.

Summary Plan Description

This booklet is a Summary Plan Description and summarizes the provisions of the Northeast Georgia Health System, Inc. and Affiliated Companies Pension Plan as most recently amended effective January 1, 2006.

This booklet is intended to help you understand the main features of the Plan. It should not be considered as a substitute for the Plan document, which governs the operation of the Plan. That document sets forth all of the details and provisions concerning the Plan and is subject to amendment. If any questions arise that are not covered in this booklet or if this booklet appears to conflict with the official Plan document, the text of the official Plan document will determine how questions will be resolved.

Continued on next page

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Overview, Continued

Contents The following table lists the contents of this Summary.

Topic Page

Eligibility 3

How Service is Counted 5

When You May Retire 9

How Much the Plan Pays 10

Methods of Payment 21

When Benefits May Not be Paid

24

If You Leave 25

If You Are Reemployed 27

If You Become Disabled 28

If You Die 28

Filing Claims and Appealing Claim Denials

29

Additional Information 34

Administrative Information 44

Additional Information

If, after reading this summary, you have any questions or need additional information about the Pension Plan, contact the Benefits Department.

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Eligibility

Plan Participation

If you were hired before January 1, 2006, you are eligible to participate in the Pension Plan on the January 1 or July 1 on or after the date you have both:

� reached age 21, and � worked at least 1,000 hours in your

first 12 months of employment or in any Plan year that begins after your date of employment.

Eligible Employees

You are eligible to participate in the Pension Plan unless:

� you are covered by a bargaining agreement that has not negotiated plan participation,

� you are a medical doctor who does not have an employment contract that provides for plan participation,

� you are a leased employee or independent contractor, or

� you are hired for the first time after December 31, 2005.


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Eligibility, Continued

Participation if You are Reemployed

If you were hired before January 1, 2006, and you terminate your employment and are later rehired, you will be eligible to participate in the Pension Plan on the later of:

� your rehire date, if you were either vested when you terminated, or you were not vested when you terminated, but you resume employment before five consecutive one-year breaks in service, or

� the date you meet the eligibility requirements, as long as you are rehired before five consecutive one-year breaks in service.

Participation and Payment of Benefits

It is possible to become a Plan participant and not qualify for a benefit. See “How Service is Counted” for more information.

Employee Contributions

Employees are not permitted to contribute to the Plan. There were contributions from participants prior to January 1, 1991. If you contributed to the Plan and leave employment before you become eligible for any benefit under the Plan, you will receive a refund of your employee contributions with interest.

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How Service Is Counted

Types of Service

You receive credit for two types of service:

� benefit service, and � vesting service.

Vesting service determines when you are eligible to receive a benefit. Benefit service is used to determine the amount of your benefit.

Vesting Service

� You receive credit for one year of vesting service for each calendar year in which you earn at least 1,000 hours of service. In general, you will not receive vesting service for calendar years in which you do not work 1,000 hours. See “Approved Leaves of Absence” for exceptions to this rule. Prior to January 1, 1993, you earned service for your period of employment as a covered employee.

� Certain employees who joined the Plan as part of an acquisition receive credit for vesting service prior to the acquisition date. Please contact your Human Resources representative for the date your benefit service begins if you are an employee of an acquired employer.


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How Service Is Counted, Continued

Benefit Service

Generally, Benefit Service is your whole and partial years of vesting service. Employees who joined the Plan as part of an acquisition typically receive credit for benefit service only for the period of service earned after the acquisition date. Please contact your Human Resources representative for the date your benefit service begins if you are an employee of an acquired employer.

You will not receive credit for service for which your employee contributions were refunded and you did not pay back such contributions with interest to the Plan if you were rehired before 2002.

In general, you will not receive benefit service for years in which you do not work 1,000 hours. See “Approved Leaves of Absence” for exceptions to this rule.

Hour of Service

An hour of service is credited for each hour you are paid — or are entitled to payment — for performance of your job. You may also receive credit for hours of service for time spent on vacation, holiday, illness, incapacity, layoff, jury duty, military duty, leave of absence, and periods for which back pay is awarded.


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Break in Service

A one-year Break in Service is a calendar year in which you do not complete at least 500 Hours of Service. If you have a one-year Break in Service, you will not receive credit for vesting or benefit service for that calendar year. For purposes of determining whether a one-year Break in Service has occurred, a period of leave protected under the Family and Medical Leave Act of 1993 will be treated as a period of employment.

Special rules apply if you leave employment for “parental leave” such as pregnancy, birth, adoption, or child care immediately after birth or adoption. If you leave employment for one of the reasons above, you will be credited with up to 501 Hours of Service for the period of parental leave. These hours will be credited to the year in which your parental leave starts if that credit is necessary to avoid a one-year break in service; otherwise, credit will be given in the immediately following plan year.

If you terminate employment and are later rehired before five consecutive one-year breaks in service, you will receive credit immediately for your prior vesting and benefit service. If you were not 100 percent vested in your plan benefit when you terminated employment and you are later rehired after five or more consecutive one-year breaks in service, you will lose credit for all of your years of vesting and benefit service accumulated before you terminated employment. Even if you do not terminate employment, you could cease to be a participant under the plan if you are not vested and you have five consecutive years with less than 500 hours of service in each year.


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Approved Leaves of Absence

Approved Leaves of Absence

You will be credited with up to 12 months of benefit and vesting service while on any approved leave of absence as though your employment had continued during the leave, provided you resume employment promptly after the expiration of the approved leave.

Military Leave

You will receive credit for benefit and vesting service as though your active employment had continued during a period of military duty with the Uniformed Services of the United States of America, provided that you are honorably discharged from active duty and resume employment within your legally protected reemployment period.

Paid Days Off

Periods of service attributable to Paid Days Off (PDO) which are paid after termination of employment will not be included in benefit service or vesting service.

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When You May Retire

Normal Retirement Age

Your normal retirement age is the later of:

� the day you reach age 65, or

� your age on the fifth anniversary of the date you began participating in the Plan.

Normal Retirement Date

Your normal retirement date is the first day of the month on or after the date you reach normal retirement age.

Delayed Retirement

If you continue employment after your normal retirement date, your delayed retirement date will be the first day of the month on or after the date you actually retire.

Even if you are still working, benefit payments will begin on the April 1 following the calendar year in which you reach age 70-1/2.

Early Retirement

You may take early retirement after you have reached age 55 and completed 10 years of vesting service.

Your early retirement date will be the first day of the month on or after the date you meet these requirements, and you decide to retire.

Paid Days Off

Benefits begin on the first day of the month following your date of retirement, regardless of the number of Paid Days Off you have accumulated.

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How Much the Plan Pays

Normal Retirement

If you retire on your normal retirement date, your benefit will be calculated as the sum of your Pre-2006 Benefit and your Post-2005 Benefit:

Pre-2006 Benefit:

� Base Benefit — 1% of your Final

Average Earnings as of December 31, 2005, multiplied by your years of Benefit Service as of December 31, 2005

plus � Excess Benefit — .65% of the

amount, if any, of Final Average Earnings as of December 31, 2005, that is more than your Covered Compensation for 2005, multiplied by your years of Benefit Service as of December 31, 2005 (up to 35 years).

Post-2005 Benefit:

1% of your Career Earnings, beginning January 1, 2006.


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How Much the Plan Pays, Continued

Career Earnings

Career earnings is the sum of your Compensation for each year in which you earn a year of Benefit Service, beginning with 2006 and ending in your last year of employment.

Compensation For purposes of the Plan, compensation is your taxable earnings for a particular Plan Year, including your base salary or wages, overtime pay, bonuses, commissions, call pay and shift differential pay. It also includes any before-tax amounts you contribute for benefits.

Compensation does not include items such as the imputed cash value of group term life insurance, moving expenses, employer contributions to this Plan or to any other deferred compensation plan that is not currently taxable, expense reimbursements, long-term productivity compensation, earnings attributable to Paid Days Off which are paid after termination of employment, and certain types of executive compensation.


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Covered Compensation

Covered Compensation is the average of your maximum amount of earnings subject to Social Security taxes (the Social Security Wage Base) over the 35-year period ending when you reach Social Security retirement age.

If you leave your employment with the Employer or an affiliated company before Social Security retirement age, Covered Compensation will be determined assuming there are no increases in your taxable wages after your termination date. Covered Compensation is frozen in the year in which you reach Social Security retirement age. Covered Compensation is not used by the plan formula after 2005.

Social Security retirement age is 65 for those born before 1938, age 66 for those born between 1938 and 1954, and age 67 for those born after 1954.

Final Average Earnings

Your Final Average Earnings is the average annual amount of compensation you received in your five consecutive calendar years of greatest compensation during your final ten calendar years with the Employer. If you have worked for the Employer for fewer than five years, your final average earnings will be based on your whole years of employment with the Employer. Your Final Average Earnings is frozen as of December 31, 2005.


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Example 1 — Normal Retirement Benefit Calculation

Suppose you want to determine your normal retirement benefit as of January 1, 2008. Let’s assume that your Pre-2006 Base Benefit is $5,800; your Pre-2006 Excess Benefit is $0; your Career Earnings are $80,000; and your total Vesting Service is 19 years.

Step Calculation

1. Determine your Post-2005 Benefit: multiply your Career Earnings by 1%

.01 x $80,000 = $800

2. Your annual normal retirement benefit is the sum of your total Pre-2006 Benefit plus your Post-2005 Benefit

$5,800 + $0 +$800 = $6,600

3. Divide that amount by 12 to get to your monthly normal retirement benefit

$6,600 ÷ 12 = $550

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Example 2 — Normal Retirement Benefit Calculation

Suppose you want to determine your normal retirement benefit as of January 1, 2008. Let’s assume that your Pre-2006 Base Benefit is $10,300; your Pre-2006 Excess Benefit is $1,000; your Career Earnings are $130,000; and your total Vesting Service is 19 years.

Step Calculation


.01 x $130,000 = $1,300

2. Your annual normal retirement benefit is the sum of your total Pre-2006 Benefit plus your Post-2005 Benefit

$10,300 + $1,000 +$1,300 = $12,600

3. Divide that amount by 12 to get to your monthly normal retirement benefit

$12,600 ÷ 12 = $1,050


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Minimum Normal Retirement

Your monthly benefit at normal retirement will never be less than:

� your accrued benefit based on your employee contributions (if any) as of your normal retirement date,

� your accrued benefit calculated as of December 31, 1988, under the benefit formula then in effect,

� your accrued benefit calculated as of December 31, 2005, under the benefit formula then in effect, or

� the greatest amount you could have received as an early retirement benefit.

Delayed Retirement

You are not required to retire on your normal retirement date.

If you choose to continue working after your normal retirement date, then your benefits will not be paid until the earlier of the date you actually retire or the April 1 following the year you reach age 70-1/2. Your retirement benefit will be calculated in the same manner as the normal retirement benefit, except it will be based on your Pre-2006 Benefit and your Career Earnings as of your delayed retirement date.

If you continue active employment after in-service payments are required to begin (April 1 following the year you reach age 70-1/2), your benefit amount will be reviewed at the end of each year until you retire to determine if new accruals require an adjustment in your benefit amount.


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Delayed Retirement, continued

If, after your normal retirement date, you work fewer than 80 hours per month, the benefit you receive on your actual retirement date will include an actuarial adjustment for the period after Normal Retirement Age.

You will not earn any additional benefit from the Plan unless you work more than 1,000 hours in a calendar year.

If your benefits are to be suspended, then you will receive a notice from the Human Resources Department, just after you reach age 65.

Early Retirement

If you choose to take early retirement, your retirement benefit will be calculated in the same manner as the normal retirement benefit, except that it will be based on your Pre-2006 Benefit and your Career Earnings as of your early retirement date.


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Reduction for Early Retirement

You will begin receiving your benefit on your normal retirement date, unless you elect to begin receiving reduced payments earlier. If you elect to start your payments before age 65, then your benefit will be reduced, based on your age, because the benefit is expected to be paid over a longer period of time.

Your early retirement benefit will be reduced based on the following factors:

� Pre-2006 Base Benefit and Post-2005 Benefit Reduction Factor — 1 minus the smaller of:

� 5/12 of 1% for each complete month that your early retirement date precedes your normal retirement date, or

� 5% of the excess, if any, of 85 over the sum of your age on your last birthday plus your completed years of vesting.

� Pre-2006 Excess Benefit Reduction Factor — based on the following table (interpolate for intermediate ages):


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Reduction for Early Retirement, continued

The following is continued from the previous page.

Age Reduction

Factor Age Reduction

Factor

65 1.000 59 .654

64 .923 58 .615

63 .846 57 .577

62 .769 56 .529

61 .731 55 .486

60 .692

Example 3 — Early Retirement Benefit Calculation

Suppose you want to determine your normal retirement benefit as of January 1, 2008 when you are age 58. Let’s assume that your Pre-2006 Base Benefit is $10,300; your Pre-2006 Excess Benefit is $1,000; your Career Earnings are $130,000; and your total Vesting Service is 19 years.


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Example 3 — Early Retirement Benefit Calculation, continued


Step

Calculation


.01 x. $130,000 = $1,300

2. Determine the total of your Post-2005 Benefit and your Pre-2006 Base Benefit

$10,300 + $1,300 = $11,600

3. Calculate the Reduction Factor for the Pre-2006 Base Benefit and the Post-2005 Benefit

Determine the number of months early: Age 65 – age 58 = 7 years x 12 months = 84 months 1 minus the smaller of: � 5/12 x .01 x 84 = .35 � .05 x [85 – 58 (age)

- 19 (service)] = .40 Early Reduction Factor = 1 - .35 = .65

4. Reduce the result of Step 2 by the result of Step 3

$11,600 x .65 = $7,540


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Example 3 — Early Retirement Benefit Calculation, continued


Step Calculation

5. Determine your Pre-2006 Excess Benefit

$1,000

6. Look up the Excess Benefit Reduction for age 58

.615

7. Reduce the result of Step 5 by the result of Step 6

$1,000 x .615 = $615

8. Add the results of Step 4 and Step 7.

$7,540 + $615 = $8,155

9. Divide that amount by 12 to get your monthly early retirement benefit

$8,155 ÷ 12 = $679.58


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Methods of Payment

Normal Form of Payment

The following chart illustrates the normal forms of benefit payment.

If… Then…

You are not married when your benefits begin,

The normal form of payment is a Single Life Annuity — a monthly benefit that continues for the rest of your life. Under this form of payment, no benefits are payable after your death.

You are married when your benefits begin,

Your normal form of payment is the Qualified Joint and Survivor Annuity. Under this payment method, you receive a reduced monthly benefit for your lifetime. After you die, 50% of that monthly amount continues to your surviving spouse for the rest of his or her life.

Normal Form of Payment, continued

NOTE: Northeast Georgia Health System, Inc. will provide a written explanation of the normal form of payment to each participant before his or her retirement date. You may waive the normal form of payment and elect an optional form any time before the later of

� Your benefit commencement date, or � 30 days after you receive the written explanation of

your benefits

You may waive the 30 day election period, but your benefit cannot begin less than 7 days after you receive the written explanation.

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Methods of Payment, Continued

Optional Forms of Payment

The optional forms of payment are:

Form of Payment Description

Single Life Annuity

A monthly benefit you receive for as long as you live.

Joint and Survivor Annuity

A reduced monthly benefit you receive for as long as you live, and after your death, 50%, 75% or 100% of that benefit will continue to your surviving spouse until his or her death.

Ten Years Certain and Life Annuity

A reduced monthly benefit you receive until your death. If you die within the ten-year period after your retirement date, payments will continue to your beneficiary for the remainder of the ten-year period.

Lump Sum Payment

A benefit paid to you in one lump sum if the current value of your benefit is not greater than $10,000.


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Methods of Payment, Continued

Spouse’s Consent

If you are married when your benefits begin and select any option other than the Joint and Survivor annuity options, your spouse must consent. This consent must be in writing and be witnessed by a notary or plan representative.

Value of Optional Forms

The various optional forms are calculated to be of actuarial equivalent value of the single life annuity, based on your age and the age of your spouse or beneficiary, when your benefit payments begin.

Small Payment Amounts

If you are entitled to receive a benefit that has an actuarial equivalent value of $1,000, or less, you will automatically receive your benefit in a single lump sum payment. If you are entitled to receive a benefit that has an actuarial equivalent between $1,000 and $5,000, your benefit will be automatically rolled into an IRA established for you with the default provider (currently, Branch Banking and Trust) unless you elect to have your benefit paid directly to you in cash or rolled over into an IRA of your choice. No further benefits will be paid.

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When Benefits May Not Be Paid

When Benefits May Not be Paid

You may not receive any benefits from the Plan if:

� you die before you have completed five years of vesting service and/or you are not survived by an eligible spouse,

� you die after you retire and the form of payment you chose does not provide for any payments to a spouse or beneficiary, or

� you leave your employment before you have completed five years of vesting service unless you are rehired before you have a 5-year break in service.

However, if you have contributed to the Plan and you leave employment before you become eligible for any benefit under the Plan, you will receive a refund of your employee contributions with interest.

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If You Leave

Vesting You will become 100% vested in your Plan benefit when you complete five years of vesting service. This means that you have earned a nonforfeitable right to your pension plan benefit. When you reach your normal retirement date, you will be automatically vested as of that date, regardless of your vesting service.

Before You are Vested

If you leave the Employer or an affiliated company before you are vested, you will receive a refund of your employee contributions (if any) to the Plan as of your termination date, plus interest. You are not eligible for other benefits from the Plan.

After You are Vested

If you terminate your employment after you are vested in the Plan but before retirement, you will receive a vested termination benefit at your Normal Retirement date equal to your accrued benefit.


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If You Leave, Continued

With Ten or More Years of Service

If you terminate your employment and have completed at least ten years of Vesting Service, you may begin receiving your vested termination benefit on your early retirement date. Your benefit will be reduced as follows:

� your Pre-2006 Base Benefit and your Post-2005 Benefit will be reduced by 1 minus 5/12 of 1% for each complete month that your early retirement date is before your normal retirement date, and

� your Pre-2006 Excess Benefit will be reduced according to the table shown on page 18.

Accrued Benefit

Your accrued benefit is calculated in the same manner as your normal retirement benefit, except it is based on your Pre-2006 Benefit and your Career Earnings as of your date of termination. Payments will begin on your normal retirement date, or early retirement date, if you have at least 10 years of vesting service and elect to start payments early.

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If You Are Reemployed

Before Benefits Begin

If you leave your employment as a vested Plan participant and are later rehired, you begin participating in the Plan again on your rehire date. If you leave before you are vested and return after a Five-Year Break in Service, you will be treated as a new employee who is not eligible to participate in this plan. See “Eligibility.”

If you leave before you are vested and return before a Five-Year Break in Service, then you will retain your previous Vesting Service for purposes of determining your participation date.

After Benefits Begin

If you are rehired after monthly benefits begin and you are scheduled to work at least 80 hours per month, your payments will stop. Your benefit payments will begin again when you retire or work fewer than 80 hours per month. Your benefit will be based on all of your years of service and will be reduced by the value of the benefits you have already received from the Plan.

If you are rehired after monthly benefits begin and you are scheduled to work fewer than 80 hours per month, your payments will continue while you are employed. You will not earn any additional benefit from the Plan unless you work more than 1,000 hours in a calendar year.

After You Receive a Lump-Sum Payment

If you are rehired after you receive a lump-sum payment from the Plan, your benefit, when you retire again, will be reduced by the value of the benefit you have already received from the Plan.

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If You Become Disabled

Background If you become totally and permanently disabled while you are an active employee prior to your Normal Retirement date, your termination will be treated like other terminations from the employer. You may be eligible to receive termination or early retirement benefits if you were vested or satisfied the criteria for early retirement at the date of your disability. See the sections titled, “When You May Retire,” “How Much the Plan Pays” and “If You Leave” for descriptions of the benefits that may be payable.

If You Die

Before You are Vested Or If You are Not Married

If you die before you are vested in the Plan or if you die and are not married, your beneficiary will receive a refund of your employee contributions to the Plan as of your date of death (if any), plus interest. There will be no other benefit payable from the Plan.

After You are Vested

After Benefits Begin

If you die after you are vested in the Plan and you are married, your surviving spouse will receive a monthly benefit that is equal to 50% of your accrued benefit.

The benefit may be paid to your spouse as early as the first day of the month following your date of death, and will be reduced by 1 minus 5/12 of 1% for each complete month that the benefit begins before what would have been your 55th birthday, if you died in active employment, or your 65th birthday, if you died after you terminated but before your benefits began. However, the benefit payable to your spouse will never be less than 25% of your accrued benefit.

If you are not married at the time of your death, then your beneficiary will receive a refund of your employee contributions, if any.

If you die after benefits begin, death benefits will be paid to your surviving spouse or beneficiary according to the form of payment you chose.

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Filing Claims and Appealing Claim Denials

Initial Claim You must use and exhaust this plan’s administrative claims and appeals procedure before bringing a suit in either state or federal court. Similarly, failure to follow the plan’s prescribed procedures in a timely manner will also cause you to lose your right to sue regarding an adverse benefit determination.

The procedure for presenting claims for benefits is as follows:

A claim for Plan benefits must be in writing and addressed to Northeast Georgia Health System, Inc. You will receive written notice from the Company with respect to your claim within 90 days of the date your initial claim was received.

Denial of Your Claim

If you receive an adverse benefit determination (i.e., any denial, reduction or termination of a benefit, in whole or in part, or a failure to provide or make a payment), the plan administrator will notify you of the adverse determination within a reasonable period of time, but not later than 90 days after receiving the claim. This 90-day period may be extended for up to an additional 90 days, if the plan administrator both determines that special circumstances require an extension of time for processing the claim, and notifies you of the special circumstances requiring the extension of time and the date by which the plan expects to render a decision before the initial 90-day period expires.


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Filing and Appealing Claim Denials, Continued

Denial of Your Claim, continued

In the event an extension is necessary due to your failure to submit necessary information, the plan’s time frame for making a benefit determination on review is stopped from the date the plan administrator sends you the extension notification until the date you respond to the request for additional information.

The plan administrator will provide you with notification of any adverse benefit determination, which will set forth:

1) The specific reason(s) for the adverse benefit determination,

2) Reference to the specific plan provisions on which the benefit determination is based,

3) A description of any additional material or information that is necessary for you to perfect the claim and an explanation of why that material or information is necessary, and

4) A description of the plan’s appeal procedures, including a statement of your right to bring civil action under ERISA after an adverse determination on appeal.


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Claim Review

The procedures for review of claims that are partially or totally denied are as follows:

Step 1 You, or your authorized representative, have 60 days following the receipt of a notification of an adverse benefit determination within which to appeal the determination. You have the right to:

1) Submit written comments, documents, records and other information relating to the claim for benefits

2) Request free of charge, reasonable access to, and copies of, all documents, records and other information relevant to your claim for benefits. For this purpose, a document, record or other information is treated as “relevant” to your claim if it:

a) Was relied upon in making the benefit determination

b) Was submitted, considered or generated in the course of making the benefit determination, regardless of whether such document, record or other information was relied upon in making the benefit determination

c) Demonstrates compliance with the administrative processes and safeguards required in making the benefit determination, or

d) Constitutes a statement of policy or guidance with respect to the plan concerning the denied benefit.


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Step 1, continued

3) A review that takes into account all comments, documents, records and other information submitted by you relating to the claim, regardless or whether such information was submitted or considered in the initial benefit determination

Step 2 The plan administrator will notify you of the plan’s benefit determination on review within a reasonable period of time, but not later than 60 days after receipt of your request for review by the plan. This 60-day period may be extended for up to an additional 60 days if the plan administrator both determines that special circumstances require an extension of time for processing the claim and notifies you of the special circumstances requiring the extension of time and the date by which the plan expects to render a determination upon review before the initial period expires.

In the event an extension is necessary due to your failure to submit necessary information, the plan’s timeframe for making a benefit determination on review stops on the date the plan administrator sends you the extension notification until the date you respond to the request for additional information.


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Step 2, continued

The plan administrator’s notice of an adverse benefit determination on appeal will contain all of the following information:

1) The specific reason(s) for the adverse benefit determination

2) Reference to the specific plan provisions on which the benefit determination is based

3) A statement that you are entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to your claim

4) A statement describing any voluntary appeal procedures offered by the plan and your right to obtain the information about such procedures, and

5) A statement of your right to bring action under ERISA.


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Additional Information

Maximum Benefits

Federal law sets a limit on the amount of compensation that can be used to determine your retirement benefit and on the amount of annual benefits you can receive from the Plan. If you are affected by either of these limits, you will be notified by the Employer.

Top-Heavy Plans

The Internal Revenue Code requires that all plans contain specific provisions to follow if the plan becomes “top heavy”. A top-heavy plan provides more than 60% of its benefits to certain “key” employees. A key employee (as defined by the Code) is usually a highly paid officer, a major stockholder, or a highly compensated individual. It is unlikely that the Plan will become top heavy, but if it does, the Employer will let you know how your benefits will be affected. For example, benefits may be modified to provide more rapid vesting or the amount of pay considered in calculating benefits for key employees may be limited.

Tax Information

When you, your spouse, or your beneficiary are entitled to receive monthly retirement benefits from the Plan, you will be given the option of having income taxes withheld from the payments you receive. If you do not elect to withhold, you will be responsible for estimating and paying income tax on the payments you receive. If your estimate is wrong and you don’t pay enough taxes, you may be subject to tax penalties.


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Additional Information, Continued

Rollover of Lump-Sum Payment

The Employer is required to withhold 20% of federal income tax from any lump-sum payment that is eligible for rollover, which is not transferred directly into another qualified retirement plan or individual retirement account.

If you receive a payment from the Plan before you reach age 59-1/2 and you do not roll it over, you may have to pay a 10% early-distribution tax. At least 30 days before you receive your distribution, you will receive further tax information and a form on which you may elect a rollover to another qualified plan or an IRA. You may want to consult a tax advisor before making a decision about payment of your benefits from the Plan.

NOTE: If your have questions about rolling over your distribution, contact the Human Resources Department.

Assignment of Benefits

Because your Plan benefit is designed to provide security during your retirement, benefits are not assignable or subject to the claim of any creditor. However, under The Retirement Equity Act of 1984, a federal law, the Plan provides that your benefits may be paid to a divorced spouse, child or other dependents under a qualified domestic relations order (QDRO).


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Assignment of Benefits continued

A QDRO is any judgment, decree or order (including certain property settlement agreements) that provides for child support, alimony, and/or marital property rights to a spouse, former spouse, child or other dependents under state domestic relations law, including a community property law. If you or your spouse need information on obtaining a QDRO, contact your Human Resources Department.

Future of the Plan

It is the Employer’s intent that the Plan will continue indefinitely. However, the Employer reserves the right to amend, modify, suspend or terminate the Plan, in whole or in part, by action of the Employer’s Board of Directors. Any such action would be taken in writing and maintained with the records of the Plan. Plan amendment, modification, suspension or termination may be made for any reason, and at any time, and may, in certain circumstances, result in the reduction or elimination of benefits or other features of the Plan to the extent permitted by law.

If the plan is terminated, you will become fully vested in the benefits you have accrued to that point (to the extent they are funded). Benefits will be distributed to you in any manner permitted by the Plan and government regulations as soon as practicable. Any excess funds will revert to the Employer.


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PBGC While the Plan can only pay benefits based on the assets in the Trust Fund, benefits under this Plan are insured by the Pension Benefit Guaranty Corporation (PBGC) if the Plan terminates. Generally, the PBGC guarantees most vested normal age retirement benefits, early retirement benefits, and certain disability and survivor’s pensions. However, the PBGC does not guarantee all types of benefits and the amount of benefit protection is subject to certain limitations.

The PBGC guarantees vested benefits at the level in effect on the date of plan termination. However, if a plan has been in effect less than five years before it terminates, or if benefits have been increased within the five years before plan termination, the whole amount of the plan’s vested benefit or the benefit increase may not be guaranteed. In addition, there is a limit on the amount of monthly benefit that PBGC guarantees, which is adjusted periodically.

For more information on the PBGC insurance protection and its limitations, contact the Employer, or the Technical Assistance Division, 1200 K Street N.W., Suite 930, Washington, D.C. 20005-4026 or call 202-326-4000 (not a toll-free number). TTY/TDD users may call the federal relay service toll-free at 1-800-877-8339 and ask to be connected to 202-326-4000. Additional information about the PBGC pension insurance program is available through the PBGC website on the Internet at http:// www.pbgc.gov. The Employer pays the insurance premium for each Plan participant.


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Statement of ERISA Rights

As a participant in the Northeast Georgia Health System, Inc. and Affiliated Companies Pension Plan, you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). At the same time, ERISA imposes some specific obligations on the people who administer the Pension Plan. This section, which is required by ERISA, is a statement of those rights and obligations. ERISA provides that all Plan participants shall be entitled to:

� Examine, without charge, all documents governing the Plan, including a copy of the latest annual report (Form 5500) filed by the Plan with the U.S. Department of Labor and available at the Public Disclosure Room of the Employee Benefits Security Administration. All such documents may be examined, at no charge, at the Human Resources Department.

� Obtain copies of all Plan documents and other Plan information. You must make your request for such copies in writing to the Human Resources Department. A reasonable charge may be made for the copies.

� Receive a summary of the Plan’s annual financial report. The plan administrator is required by law to furnish each participant with a copy of this summary annual report.


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Statement of ERISA Rights, continued

� Obtain a statement telling you whether you have a right to receive a pension at normal retirement age (age 65) and, if so, what your benefits would be at normal retirement age if you stop working under the Plan now. If you do not have a right to a pension, the statement will tell you how many more years you have to work to be eligible to receive a pension. This statement will be provided free of charge. You may make a written request for this statement, but it is not required to be given more than once every twelve (12) months.

ERISA Duties

In addition to creating rights for the Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the employee benefit plan.

� The people who operate your Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and their beneficiaries.


40


ERISA Duties, continued

� No one, including your employer, or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a pension benefit or exercising your rights under ERISA.

� If your claim for a pension benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules.

Enforcing Your Rights

Under ERISA, there are steps you can take to enforce your rights.

� For instance, if you request materials from the Plan and do not receive them within 30 days, you may file suit in a federal court. In that case, the court may require Northeast Georgia Health System, Inc. to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the administrator.


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Enforcing Your Rights, continued

� If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in state or federal court but only after you have exhausted the plan’s claims and appeals procedure, as described on pages 32-36. In addition, if you disagree with the Plan’s decision or lack thereof concerning the qualified status of a domestic relations order or a medical child support order, you may file suit in Federal court. If it should happen that Plan fiduciaries misuse the Plan’s money, or if you are discriminated against for asserting your rights, you may seek assistance from the US Department of Labor, or you may file suit in a federal court. The court will decide who should pay court costs and legal fees.

� If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous.

If you have any questions about your plan, you should contact the plan administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the plan administrator, you should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in your telephone directory or the


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Enforcing Your Rights, continued

Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, D.C. 20210. You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration at 1-800-998-7542 or by visiting the Internet at http://www.dol.gov/ebsa or by contacting the EBSA field office nearest you.

Your Employment

The summary plan description provides detailed information about the Plan and how it works. The SPD does not constitute an implied or expressed contract or guarantee of employment. The Employer’s employment decisions are made without regard to benefits to which you are entitled upon employment.

Discretion to Interpret Plan

To the fullest extent permitted by law, the Plan Administrator will have the exclusive discretion to determine all matters relating to eligibility, coverage and benefits under the Plan. The Plan Administrator will also have the exclusive discretion to determine all matters relating to interpretation and operation of the Plan. Decisions by the Plan Administrator, or any authorized delegate, will be conclusive and binding on all parties.


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Administrative Information

Plan Name The formal name of the Plan is Northeast Georgia Health System, Inc. and Affiliated Companies Pension Plan.

Type of Plan The Plan is a defined-benefit pension plan providing retirement, termination, and death benefits to eligible employees of Northeast Georgia Health System, Inc. and Affiliated companies that participate in the Plan.

Plan Sponsor and Employer

The Plan Sponsor is:

Northeast Georgia Health System, Inc. 743 Spring Street Gainesville, Georgia 30501 (770) 535-3553.

Plan Administrator

The Plan Sponsor is the Plan Administrator.

Plan Year The Plan Year is the calendar year, January 1 to December 31.

Plan Funding The source of the Plan contributions is the participating companies. The amount of Employer contributions is recommended by an enrolled actuary. Contributions go into a trust fund, and are held and managed by the Trustee.

Contributions are not required from employees. Contributions were required from participants prior to January 1, 1991.


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Administrative Information, Continued

Employer Identification Number (EIN)

The Employer Identification Number (EIN) assigned to Northeast Georgia Health System, Inc. by the Internal Revenue Service is 58-1694090.

Plan Number The Plan Number (PN) assigned to the Pension Plan is 001.

Trustee The trustee for the Plan is:

SunTrust Bank, Inc. P.O. Box 4655 Atlanta, GA 30302

Service of Legal Process

Legal process may be served on the President of Northeast Georgia Health System, Inc. The President’s address is:

743 Spring Street Gainesville, Georgia 30501

Legal process may also be served on the Trustee.

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