Exhibit 10.5

 

 

 

CHS/COMMUNITY HEALTH SYSTEMS, INC.

2018 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

 

 

 

January 1, 2018

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TABLE OF CONTENTS

 

        Page  1.   PURPOSE   1   2.   DEFINITIONS AND CONSTRUCTION   1     2.1  
Definitions   1     2.2   Captions; Section References   5     2.3  
Severability   5   3.   ADMINISTRATION   5     3.1   The Committee   5     3.2  
Authority of the Committee   5     3.3   Decisions Binding   5     3.4   Plan
Administrator   5     3.5   Costs and Expenses   6     3.6   Indemnification  
6   4.   PARTICIPATION IN THE PLAN   6     4.1   Notification of Participation  
6     4.2   Termination of Participation   6   5.   BENEFITS UPON SEPARATION
FROM SERVICE OR DEATH   6     5.1   Normal Retirement Benefit   6     5.2  
Early Retirement Benefit   7     5.3   Disability Benefit   8     5.4   Death
Benefit   8     5.5   Intentionally omitted   8   6.   BENEFITS UPON CHANGE IN
CONTROL   8     6.1   Change in Control Benefit   8     6.2   Participants Under
Age 55   8     6.3   Additional Years of Service   9     6.4   Certain
Terminations of Employment   9   7.   BENEFICIARIES   9   8.   RABBI TRUST   9  
9.   WITHHOLDING   9   10.   MODIFICATION AND TERMINATION   9     10.1  
Amendment and Termination   9     10.2   Effect on Participants   9     10.3  
No Obligation to Continue Plan   10  

 

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TABLE OF CONTENTS

(continued)

 

        Page  11.   CLAIMS AND REVIEW PROCEDURES   10   12.   MISCELLANEOUS
PROVISIONS   10     12.1   Non-Transferability   10     12.2   Payment of
Benefits   10     12.3   No Rights of Employment   10     12.4   Applicable Law
  11     12.5   Payment to Minors   11   EXHIBIT A     Date of Hire for Certain
Plan Participants   12  

 

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CHS/COMMUNITY HEALTH SYSTEMS, INC.

2018 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

WHEREAS, CHS/Community Health Systems, Inc. (the “Company”) maintains the
CHS/Community Health Systems, Inc. Amended and Restated Supplemental Executive
Retirement Plan (the “Original Plan”); and

WHEREAS, the Original Plan, as amended, continues in full force and effect; and

WHEREAS, the Company, in order to more closely align with competitive market
levels for certain employees of affiliates of the Company, now wishes to
establish the CHS/Community Health Systems, Inc. 2018 Supplemental Executive
Retirement Plan (the “Plan”), effective January 1, 2018.

NOW, THEREFORE, the Plan shall provide as follows:

1.         Purpose. The purpose of this Plan is to advance the interests of CHS
by encouraging officers and other key employees of the Company and its
subsidiaries who will largely be responsible for the long-term success and
development of CHS to continue their employment with the Company and its
subsidiaries by providing retirement benefits for them. The Plan is also
intended to assist the Company and its subsidiaries in attracting and retaining
such employees and stimulating their efforts on behalf of the Company and its
subsidiaries.

2.         Definitions and Construction.

2.1    Definitions. As used in the Plan, terms defined parenthetically
immediately after their use shall have the respective meanings provided by such
definitions, and the following words and phrases shall have the meanings
specified below (in either case, such terms shall apply equally to both the
singular and plural forms of the terms defined), unless a different meaning is
plainly required by the context:

(a)        “Actuarial Equivalent” shall mean a benefit of equivalent value
calculated based on the Uninsured Pensioners 1994 Mortality Table including
Projections to 2003 using 50% of the Male Rates and 50% of the Female Rates as
prescribed for qualified retirement plans under the General Agreement on Trades
and Tariffs (GATT) and a discount rate equal to the yield on 10-Year Treasury
Bonds for the twenty-four (24) months preceding the last day of the previous
month (as determined by the Committee in good faith), but in no event greater
than 4% per annum.

(b)        “Annual Retirement Benefit” shall mean an amount equal to a
Participant’s Final Average Earnings multiplied by the lesser of (i) 60%, or
(ii) a percentage equal to 2% multiplied by the Participant’s years of Service.

(c)        “Beneficiary” shall mean the person or persons designated by a
Participant pursuant to Section 7 to receive the benefits to which a Participant
is entitled upon the death of a Participant.

 

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(d)        “Board” shall mean the Board of Directors of the Company or, as the
context requires, CHS.

(e)        Intentionally omitted.

(f)        “Change in Control” shall mean the occurrence of any of the following
events, but only to the extent such event would constitute a change in the
ownership or effective control of CHS, or in the ownership of a substantial
portion of the assets of CHS, as set forth in Code Section 409A(a)(2)(A)(v) and
defined in regulations promulgated by the U.S. Department of Treasury
thereunder:

(1)        An acquisition (other than directly from CHS) of any voting
securities of CHS (“Voting Securities”) by any Person (as the term person is
used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of
1934, as amended (“Exchange Act”)) immediately after which such Person has
Beneficial Ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of more than 50% of the then-outstanding shares of Common Stock of
CHS (“Shares”) or the combined voting power of CHS’ then-outstanding Voting
Securities; provided, however, in determining whether a Change in Control has
occurred pursuant to this Section 2.1(f)(1), Shares or Voting Securities which
are acquired in a Non-Control Acquisition (as hereinafter defined) shall not
constitute an acquisition that would cause a Change in Control. A “Non-Control
Acquisition” shall mean an acquisition by (i) an employee benefit plan (or a
trust forming a part thereof) maintained by the Company or any Subsidiary,
(ii) CHS or any Subsidiary, or (iii) any Person in connection with a Non-Control
Transaction (as hereinafter defined);

(2)        The individuals who, as of the date hereof, are members of the Board
of CHS (“Incumbent Board”), cease for any reason to constitute at least a
majority of the members of the Board of CHS or, following a Merger (as
hereinafter defined) that results in CHS having a Parent Corporation (as
hereinafter defined), the board of directors of the ultimate Parent Corporation;
provided, however, that if the election, or nomination for election, by the CHS
common stockholders, of any new director was approved by a vote of at least
two-thirds of the Incumbent Board of CHS, such new director shall, for purposes
of the Plan, be considered as a member of the Incumbent Board of CHS; provided
further, however, that no individual shall be considered a member of the
Incumbent Board of CHS if such individual initially assumed office as a result
of either an actual or threatened Election Contest (as described in Rule 14a-11
promulgated under the Exchange Act) or other actual or threatened solicitation
of proxies or consents by or on behalf of a Person other than the Board of CHS
(“Proxy Contest”), including by reason of any agreement intended to avoid or
settle any Election Contest or Proxy Contest; or

(3)        The consummation of:

(A)        A merger, consolidation or reorganization with or into the Company or
in which securities of the Company are issued (“Merger”), unless such Merger, is
a Non-Control Transaction. A Non-Control Transaction shall mean a Merger where:

(i)        the stockholders of CHS immediately before such Merger own, directly
or indirectly, immediately following such Merger, at least 50% of the combined
voting power of the outstanding voting securities of (x) the corporation
resulting from such Merger (“Surviving Corporation”), if 50% or more of the
combined voting power of the then outstanding voting securities of the Surviving
Corporation is not Beneficially Owned, directly or indirectly, by

 

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another Person (“Parent Corporation”), or (y) if there are one or more Parent
Corporations, the ultimate Parent Corporation; and

(ii)        the individuals who were members of the Incumbent Board of CHS
immediately prior to the execution of the agreement providing for such Merger,
constitute at least a majority of the members of the board of directors of (x)
the Surviving Corporation, if there is no Parent Corporation, or (y) if there
are one or more Parent Corporations, the ultimate Parent Corporation.

(B)        A complete liquidation or dissolution of CHS; or

(C)        The sale or other disposition of all, or substantially all, of the
assets of CHS to any Person (other than a transfer to a Subsidiary or under
conditions that would constitute a Non-Control Transaction with the disposition
of assets being regarded as a Merger for this purpose or the distribution to the
CHS’ stockholders of the stock of a Subsidiary or any other assets).

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
solely because any Person (“Subject Person”) acquired Beneficial Ownership of
more than the permitted amount of the then-outstanding Shares or Voting
Securities as a result of the acquisition of Shares or Voting Securities by CHS
which, by reducing the number of Shares or Voting Securities then-outstanding,
increases the proportional number of shares Beneficially Owned by the Subject
Person, provided that if a Change in Control would occur (but for the operation
of this sentence) as a result of the acquisition of Shares or Voting Securities
by CHS, and after such share acquisition by CHS the Subject Person becomes the
Beneficial Owner of any additional Shares or Voting Securities which increases
the percentage of the then-outstanding Shares or Voting Securities Beneficially
Owned by the Subject Person, then a Change in Control shall occur.

(g)        “CHS” shall mean Community Health Systems, Inc., a Delaware
corporation.

(h)        “Code” shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any successor thereto.

(i)        “Committee” shall mean the Compensation Committee of the Board of
CHS.

(j)        “Company” shall mean CHS/Community Health Systems, Inc., a Delaware
corporation.

(k)        “Compensation” shall mean only the salary plus the bonus paid to a
Participant.

(l)        “Disabled Participant” shall mean any Participant who has been
credited with five years of Service and who Separates from Service by reason of
being Totally and Permanently Disabled.

(m)        “Early Retirement Date” shall mean the date a Participant has been
credited with at least five years of Service and is at least 55 years old.

(n)        “ERISA” shall mean the Employee Retirement Income Security Act of
1974, as amended.

(o)        “Final Average Earnings” shall mean an amount equal to (i) the sum of
a Participant’s Compensation for the highest three years out of the last ten
full years of Service

 

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preceding a Participant’s termination of employment with the Company and its
Subsidiaries, divided by (ii) three.

(p)        “Key Employee” shall mean an employee (other than an Officer) of CHS,
the Company, or a Subsidiary who has been selected by the Committee to be a
Participant.

(q)        “Monthly Retirement Income” shall mean a monthly income computed as
provided in the Plan.

(r)        “Normal Retirement Date” shall mean the day of a Participant’s 65th
birthday.

(s)        “Officer” shall mean all employees of CHS, the Company, or a
Subsidiary who have been duly elected as officers of CHS by the Board of CHS.

(t)        “Participant” shall mean any Officer or Key Employee.

(u)        “Primary Insurance Amount” as of any date shall mean the monthly
amount of Social Security old age and survivor disability insurance benefits
received or receivable by a Participant commencing at the Participant’s
unreduced Social Security retirement age. The amount will be calculated based on
the Social Security Act in effect as of the date of calculation, without regard
to any dependent benefits.

(v)        “Rabbi Trust” shall mean the trust to be established by the Company
in accordance with the provisions of Section 8.

(w)        “Retired Participant” shall mean any Participant who has ceased to be
an employee of the Company or a Subsidiary and who is entitled to receive a
benefit under Section 5 of the Plan.

(x)        “Separation from Service” or “Separate from Service” means a
separation from service as set forth in Code Section 409A(a)(2)(A)(i) and
Treasury Regulation Section 1.409A-1(h), provided, however, that a Participant
shall not be deemed to have Separated from Service on account of a leave of
absence until the first date immediately following the end of a 29-month period
of leave (if the employment relationship is not terminated sooner) where such
leave is due to any medically determinable physical or mental impairment that
can be expected to result in death or can be expected to last for a continuous
period of not less than six months and where such impairment causes the
Participant to be unable to perform the duties of his or her position of
employment or any substantially similar position of employment.

(y)        “Service” shall mean one of the following: (i) in the case of an
Officer, all years and completed months of service with the Company and any
Subsidiary, whether before or after the adoption of the Plan, but not beginning
earlier than January 1, 1997 (as indicated for some Participants in Exhibit A
hereto) or, in the alternative, if the Committee so specifies for a designated
Participant, additional years and months of service, provided, however, such
additional years and months of service shall not exceed two years for every year
of completed service and two months for every one month of completed service
with the Company, but not beginning before January 1, 1997, and (ii) in the case
of an Officer or Key Employee who becomes a Participant after January 1, 2003,
all years and completed months of service following the date the person becomes
a Participant. If a Participant’s name is not listed on Exhibit A, such
Participant’s Service shall begin on the date described in clause (ii) above.

 

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(z)        “Specified Employee” means “specified employee” as defined in Code
Section 409A(a)(2)(B)(i) and Treasury Regulation Section 1.409A-1(i).

(aa)     “Subsidiary” shall mean, with respect to CHS or the Company, as
applicable, any corporation or other entity of which a majority of its voting
power, equity securities or equity interests is owned, directly or indirectly,
by CHS or the Company, as applicable.

(bb)     “Total and Permanent Disability” shall mean a physical or mental
condition that renders a Participant eligible for disability benefits under the
long-term disability insurance program in effect at the Company as of January 1,
2009, even if such Participant no longer participates in such long-term
disability program on the date such physical or mental condition occurs.

2.2      Captions; Section References. Section titles or captions contained in
the Plan are inserted only as a matter of convenience and reference, and in no
way define, limit, extend or describe the scope of the Plan, or the intent of
any provision hereof. All references herein to Sections shall refer to Sections
of the Plan unless the context clearly requires otherwise.

2.3      Severability. If any provision of the Plan, or the application thereof
to any person, entity or circumstances, shall be invalid or unenforceable to any
extent, the remainder of the Plan, and the application of such provision to
other persons, entities or circumstances, shall not be affected thereby and the
Plan shall be enforced to the greatest extent permitted by law.

3.          Administration.

3.1      The Committee. The Plan shall be administered by the Committee. The
Committee shall meet at such times and places as it determines and may meet
through a telephone conference call.

3.2      Authority of the Committee. Subject to the provisions of the Plan, the
Committee shall have full authority to:

(a)      Select Key Employees.

(b)      Construe and interpret the Plan.

(c)      Establish, amend and rescind rules and regulations for the Plan’s
administration.

(d)      Make all other determinations which may be necessary or advisable for
the administration of the Plan.

To the extent permitted by law, the Committee may delegate its authority as
identified hereunder.

3.3      Decisions Binding. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan, and all related orders or
resolutions of the Board, shall be final, conclusive and binding upon all
persons, including the Company, its stockholders, employees, Participants and
their estates and Beneficiaries.

3.4      Plan Administrator. For purposes of ERISA, the Committee is the Plan
administrator. Any claim for benefits under the Plan shall be made in writing to
the Committee.

 

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The Committee and the claimant shall follow the claims procedures set forth in
Department of Labor Regulation §2560.503-1.

3.5    Costs and Expenses. In discharging their duties under the Plan, the
Committee may employ such counsel, accountants and consults as it deems
necessary or appropriate. The Company shall pay all costs of such third parties
and any other expenses incurred by the Committee with respect to the Plan.

3.6    Indemnification. No member of the Committee, nor any officer or employee
acting on behalf of the Committee, CHS, the Company, or its Subsidiaries shall
be personally liable for any action, determination or interpretation taken or
made in good faith with respect to the Plan, and all members of the Committee,
and each and every officer or employee of CHS, the Company, or its Subsidiaries
acting on their behalf, shall, to the extent permitted by law, be fully
indemnified and protected by the Company with respect to any such action,
determination or interpretation.

4.          Participation in the Plan.

4.1    Notification of Participation. Each Officer and Key Employee shall be
notified that they are a Participant under the Plan.

4.2    Termination of Participation. A Participant who ceases to be an Officer
or a Key Employee of the Company (as determined by the Committee), or who
terminates employment with the Company and all Subsidiaries for any reason other
than death or Total and Permanent Disability, shall not be entitled to any
benefits hereunder unless that change of status occurs after the Participant has
reached their Early Retirement Date.

5.          Benefits Upon Separation from Service or Death.

5.1    Normal Retirement Benefit. A Participant (including, without limitation,
a Specified Employee) who has been credited with at least five years of Service
and Separates from Service by reason of retirement on or after the Participant’s
Normal Retirement Date shall receive a single lump-sum payment, commencing on
the day immediately following the date that is six (6) months after the date of
the Participant’s Separation from Service, in an amount that is the result of
“A.” MINUS “B.,” as described below:

 

  “A.”

Cumulative Benefit: An amount equal to the Actuarial Equivalent of a Monthly
Retirement Income equal to:

(i) one-twelfth of the Participant’s Annual Retirement Benefit, reduced by

(ii) the Primary Insurance Amount.

MINUS

 

  “B”

Original Plan Benefit: The amount payable to the Participant under Section 5.1
of the Original Plan, as in effect on November 9, 2017, as set forth in Exhibit
A of this Plan.

In order to avoid any misunderstanding, it is the specific intent of the Company
that the Original Plan Benefit payable to a Participant reduce the Participant’s
Normal Retirement Benefit payable

 

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under this Plan on a dollar-for-dollar basis. By way of example, if a
Participant’s Cumulative Benefit (“A,” above) is $10,000 per month, and the
Participant’s Original Plan Benefit (“B,” above) is $4,000 per month, the
Participant’s Normal Retirement Benefit under this Plan would be (“A” $10,000
MINUS “B” $4,000=) $6,000 per month.

Notwithstanding the foregoing, a Participant may instead elect, at any time, to
receive the benefit calculated under this Section 5.1 as an amount that is the
Actuarial Equivalent of the Monthly Retirement Income as calculated pursuant to
this Section 5.1 above as of the later of the Participant’s Eligibility Date (as
defined below) or the Participant’s Election Date (as defined below), with
interest thereon until such Participant’s Separation from Service in an amount
equal to the average yield on 10-Year Treasury Bonds for the twenty-four
(24) months preceding, calculated and compounded on a quarterly basis, but in no
event greater than 4% per annum. For the sake of clarity, an election described
in this paragraph made by a Participant who does not become an Eligible
Participant (as defined below) shall be disregarded and such Participant shall
receive the benefit, if any, to which such Participant is otherwise entitled
under this Plan. For purposes hereof, (i) an “Eligible Participant” is a
Participant who has attained the Normal Retirement Date (i.e., has reached the
age of 65) and has completed or been credited with at least twenty-five
(25) years of Service, (ii) the “Eligibility Date” is the date a Participant
becomes an Eligible Participant and (iii) the “Election Date” is the date a
Participant makes the election described in this paragraph. An election made
pursuant to this paragraph shall be made in writing delivered to the Secretary
of the CHS/Community Health Systems, Inc. and once made, shall be final and
irrevocable.

If a Participant who has had a Separation from Service and is entitled to a
Normal Retirement Benefit under this Section 5.1 dies prior to the date of such
payment, such payment shall be made, instead, to the Participant’s Beneficiary
on the date that it otherwise would have been made to the Participant, or as
soon as administratively feasible thereafter within the same taxable year (or,
if later, by the 15th day of the third calendar month following the date the
payment otherwise would have been made to the Participant, provided that neither
the Participant nor Beneficiary shall be permitted, directly or indirectly, to
designate the taxable year of payment).

5.2      Early Retirement Benefit. A Participant (including, without limitation,
a Specified Employee) who Separates from Service by reason of retirement after
attaining age 55 and who has been credited with at least five years of Service
shall receive a single lump-sum payment, commencing on the day immediately
following the date that is six (6) months after the date of the Participant’s
Separation from Service, in an amount that is the Actuarial Equivalent of a
Monthly Retirement Income computed in the manner set forth in Section 5.1,
except that the amount set forth in Section 5.1 shall be reduced by two/twelfths
of one percent (.001667) of that amount for each month that payments commence
prior to the Participant’s Normal Retirement Date. The reduction referred to in
the immediately preceding sentence shall not apply in the event of a Change in
Control. If a Participant who has had a Separation from Service and is entitled
to an Early Retirement Benefit under this Section 5.2 dies prior to the date of
such payment, such payment shall be made, instead, to the Participant’s
Beneficiary on the date that it otherwise would have been made to the
Participant, or as soon as administratively feasible thereafter within the same
taxable year (or, if later, by the 15th day of the third calendar month
following the date the payment otherwise would have been made to the
Participant, provided that neither the Participant nor Beneficiary shall be
permitted, directly or indirectly, to designate the taxable year of payment).

 

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5. 3      Disability Benefit .

(a)      A Disabled Participant (including, without limitation, a Specified
Employee) shall receive a single lump-sum payment, commencing on the later of
(i) the day immediately following the date that is six (6) months after the date
of the Participant’s Separation from Service by reason of becoming Totally and
Permanently Disabled, or (ii) the first day of the month following the
Participant’s 55th birthday, in an amount that is the Actuarial Equivalent of a
Monthly Retirement Income computed in the manner set forth in Section 5.1. This
benefit shall be payable at the time prescribed in this Section 5.3(a)
regardless of whether the Participant recovers from the disability before
payment is due.

(b)      If a Disabled Participant dies before the payment of the benefit
described in Section 5.3(a), a death benefit shall be payable to the Disabled
Participant’s Beneficiary. Such death benefit shall be a single lump-sum payment
equal to the Actuarial Equivalent present value of a Monthly Retirement Income
as of the Participant’s date of death, computed in accordance with the
provisions of Section 5.3(a). Such death benefit shall be paid to the
Participant’s Beneficiary no later than ninety (90) days after the date of death
(provided that neither the Participant nor Beneficiary shall be permitted,
directly or indirectly, to designate the taxable year of payment).

5.4      Death Benefit. If a Participant who has been credited with five or more
years of Service dies prior to incurring a Separation from Service, a single,
lump-sum death benefit shall be paid to the deceased Participant’s Beneficiary.
Such death benefit shall be the Actuarial Equivalent of the Participant’s
Monthly Retirement Income as of the Participant’s date of death, computed in the
same manner as provided in Section 5.3(a) in the case of a Disabled Participant.
Such death benefit shall be paid to the deceased Participant’s Beneficiary no
later than ninety (90) days after the date of death (provided that neither the
Participant nor Beneficiary shall be permitted, directly or indirectly, to
designate the taxable year of payment).

5.5      Intentionally omitted.

6.        Benefits Upon Change in Control.

6.1      Change in Control Benefit. In the event of a Change in Control, the
benefit of any Participant with five years or more of Service but not yet
otherwise entitled to a benefit under the other provisions of this Plan shall be
fully vested and shall be paid out as soon as administratively feasible but no
later than ninety (90) days after the Change in Control (provided that the
Participant shall not be permitted, directly or indirectly, to designate the
taxable year of payment) in a single lump-sum payment pursuant to the applicable
provisions in Section 5. Upon such payment to all Participants, the Plan shall
terminate.

6.2      Participants Under Age 55. Any Participant who has been credited with
five years or more years of Service on the date of the Change in Control who is
under age 55 will be deemed to be age 55 solely for purposes of determining if
the Participant is eligible for benefits under the Plan but, in computing the
lump sum payment provided for in Section 6.1 and the applicable provisions of
Section 5, the Monthly Retirement Income shall be deemed payable based upon the
Participant’s actual age on the date of the Change in Control.

 

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6.3      Additional Years of Service. All Participants who have been credited
with five years or more of Service as of a Change in Control will be credited
with an additional three years of Service as a result of a Change in Control.

6.4      Certain Terminations of Employment. If a Participant’s employment is
terminated by the Company prior to the date of a Change in Control, but the
Participant reasonably demonstrates to the satisfaction of the Committee that
the termination (i) was at the request of a third party who has indicated an
intention to, or has taken steps reasonably calculated to, effect a Change in
Control, or (ii) otherwise arose in connection with, or in anticipation of, a
Change in Control which has been threatened or proposed, such termination shall
be deemed to have occurred after a Change in Control for purposes of the Plan,
provided a Change in Control actually occurs. Such a Participant shall be
entitled to receive the same benefits under the Plan as if the Participant had
been an employee of the Company or a Subsidiary on the date the Change in
Control actually occurs. Notwithstanding the foregoing, no payment under this
Section 6.4 shall be made before the date that is six (6) months after the date
of the Participant’s actual Separation from Service.

7.      Beneficiaries. Each Participant shall have the right, by giving written
notice to the Committee on such form as the Committee shall adopt, to designate
a Beneficiary or Beneficiaries to receive payments which become available under
the Plan should the Participant die. A Participant may change the designated
Beneficiary by filing a new beneficiary designation form with the Committee. If
a Participant dies and has not designated a Beneficiary, or if the Beneficiary
predeceases the Participant, the estate of the deceased Participant shall be
deemed to be the Beneficiary.

8.      Rabbi Trust. The Company intends to establish a Rabbi Trust with a
commercial bank or other financial or trust institution of which the Company
would be considered the owner for Federal income tax purposes. The Rabbi Trust
will be established to provide a source of funds to enable the Company to make
payments to the Participants and their Beneficiaries pursuant to the terms of
the Plan and will be administered in a manner consistent with the requirements
of Code Section 409A. Payments to which Participants are entitled under the
terms of the Plan shall be paid out of the Rabbi Trust to the extent of the
assets therein. The assets of the Rabbi Trust will be subject to the claims of
general creditors of the Company.

9.      Withholding. The Company shall have the right to withhold from the
payments to be made to any Participant or Beneficiary hereunder all amounts
required to be so withheld under applicable law.

10.      Modification and Termination.

10.1      Amendment and Termination. The Company reserves the right at any time,
by action of the Board, to modify or amend, in whole or in part, any or all of
the provisions of the Plan, or to terminate the Plan. In the event of Plan
termination, benefits shall be payable at the time and in the manner provided in
Sections 5 and 6; however, the Company may accelerate the time and form of
payment pursuant to a termination and liquidation of the Plan in accordance with
Code Section 409A and the regulations thereunder.

10.2      Effect on Participants. Notwithstanding the provisions of
Section 10.1, no amendment, modification or termination of the Plan shall
adversely affect:

 

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(a)      The Monthly Retirement Income of any Participant, or the Beneficiary of
any Participant, who has Separated from Service or died prior thereto.

(b)      The right of any Participant then employed by the Company or a
Subsidiary who has been credited with at least five years of Service to receive
upon death, Separation from Service (including Separation from Service by reason
of Total and Permanent Disability) or Change in Control, the benefit to which
such person would have been entitled under the Plan prior to the amendment,
modification or termination, provided, however, that the Company may accelerate
the time and form of payment pursuant to a termination and liquidation of the
Plan in accordance with Code Section 409A and the regulations thereunder.

10.3      No Obligation to Continue Plan. Although it is the intention of the
Company that the Plan shall be continued indefinitely, the Plan is entirely
voluntary on the part of the Company, and the continuance of the Plan is not a
contractual obligation of the Company.

11.       Claims and Review Procedures. The Committee shall establish and
maintain reasonable procedures governing the filing of claims, notification of
benefit determinations, and appeal of adverse benefit determinations in
accordance with applicable law. Such procedures shall provide for adequate
notice in writing to any Participant or Beneficiary whose claim for benefits
under the Plan has been denied, setting forth the specific reasons for such
denial and written in a manner calculated to be understood by the Participant or
Beneficiary. Such procedures shall also afford a reasonable opportunity to any
Participant or Beneficiary whose claim for benefits has been denied for a full
and fair review by the Committee of the decision denying the claim.

12.       Miscellaneous Provisions.

12.1       Non-Transferability. Neither the interest of a Participant or any
other person in the Plan, nor the benefits payable hereunder, shall be subject
to the claim of creditors of a Participant or their Beneficiaries and will not
be subject to attachment, garnishment or any other legal process. Neither a
Participant nor a Beneficiary may assign, sell, pledge or otherwise encumber any
of their beneficial interest in the Plan, nor shall any such benefits be in any
manner liable for, or subject to, the deeds, contracts, liabilities, engagements
or torts of any Participant or their Beneficiary. All such payments and rights
thereto are expressly declared to be non-assignable and non-transferable, and in
the event of any attempted assignment or transfer (whether voluntary or
involuntary) by a Participant or a Beneficiary, the Company shall have no
further liability hereunder to such Participant or Beneficiary.

12.2      Payment of Benefits. Although the Company intends to establish the
Rabbi Trust to fund its obligations under the Plan, the rights of Participants
and Beneficiaries to receive payments under the Plan shall constitute only a
general claim against the Company and will not be a lien or claim on any
specific assets of the Company.

12.3      No Rights of Employment. The Plan shall not be deemed to constitute a
contract of employment between a Participant and the Company or a Subsidiary.
Nothing contained in the Plan shall be deemed to give any Participant the right
to be retained in the employment of the Company or a Subsidiary. The Plan shall
not interfere in any way with the Company’s or a Subsidiary’s right to discharge
a Participant at any time, regardless of the effect which such discharge would
have upon such Participant under the Plan, and such actions by the Company or

 

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a Subsidiary in discharging any Participant shall not be deemed a breach of
contract, nor give rise to any rights or actions in favor of such Participant.

12.4      Applicable Law. The Plan shall be governed by, and construed in
accordance with, the laws of the State of Tennessee without regard to its
conflict of laws rules. It is intended that the Plan be an unfunded plan
maintained primarily for the purpose of providing deferred compensation for a
select group of highly compensated employees of the Company. As such, the Plan
is intended to be exempt from certain otherwise applicable provisions of Title I
of ERISA, and any ambiguities in construction shall be resolved in favor of an
interpretation which will effectuate such intention. The Plan is intended to
comply with Code Section 409A and the Treasury Regulations promulgated
thereunder as applicable to nonqualified deferred compensation plans and shall
be construed in furtherance of such intent.

12.5      Payment to Minors. In making any payment to or for the benefit of any
minor or incompetent Beneficiary, the Committee, in its sole, absolute and
uncontrolled discretion, may, but need not, make such payment to a legal or
natural guardian or other relative of such minor or court appointed committee of
such incompetent, or to any adult with whom such minor or incompetent
temporarily or permanently resides, and the receipt by such guardian, committee,
relative or other person shall be a complete discharge of the Company, without
any responsibility on its part or on the part of the Committee to see to the
application thereof.

IN WITNESS WHEREOF, the Company has caused the Plan to be executed by its duly
authorized officer the 15th day of May, 2018 effective as set forth herein.

 

CHS/COMMUNITY HEALTH SYSTEMS, INC. By:  

    /s/ Benjamin C. Fordham

      Benjamin C. Fordham, Title:  

Executive Vice President, General Counsel and Assistant Secretary

 

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