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Item 9A. Controls and Procedures

2024-02-16 compared with 2023-02-17 · 73 added, 85 removed, 155 unchanged (50% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

Based on their evaluation as of December 31, 2022, the Chief Executive Officer and Principal Accounting Officer of the Company have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a–15(e) and 15d–15(e) under the Securities Exchange Act of 1934, as amended) were effective to ensure that the information required to be disclosed by us in this Annual Report on Form 10–K was recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and instructions for Form 10–K.

MANAGEMENT ’

S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

We are responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a–15(f) under the Securities Exchange Act of 1934, as amended).

Based on their evaluation as of December 31, 2023, the Chief Executive Officer and Chief Financial Officer of the Company have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a–15(e) and 15d–15(e) under the Securities Exchange Act of 1934, as amended) were effective to ensure that the information required to be disclosed by us in this Annual Report on Form 10–K was recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and instructions for Form 10–K.

MANAGEMENT ’ S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

We are responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a–15(f) under the Securities Exchange Act of 1934, as amended).

We assessed the effectiveness of our internal control over financial reporting as of December 31, 2023.

In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal Control–Integrated Framework (2013 Framework).

We have concluded that, as of December 31, 2023, our internal control over financial reporting is effective based on these criteria.

Our independent registered public accounting firm, Ernst & Young, LLP, has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting included herein.

Our independent registered public accounting firm, Ernst & Young LLP, has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting included herein.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

1 unchanged sentence

Opinion on Internal Control Over Financial Reporting

We have audited National HealthCare Corporation’s internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

We have audited National HealthCare Corporation’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, National HealthCare Corporation (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on the COSO criteria.

1 unchanged sentence

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

5 unchanged sentences

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

16 unchanged sentences

The information in our definitive 2024 proxy statement set forth under the caption Certain Relationships and Related Transactions is hereby incorporated by reference.

PRINCIPAL ACCOUNTING FEES AND SERVICES

5 unchanged sentences

Report of Independent Registered Public Accounting Firm (PCAOB ID:

Consolidated Statements of Operations –

Years ended December 31, 2022, 2021, and 2020

Consolidated Statements of Comprehensive Income –

Years ended December 31, 2022, 2021, and 2020

Consolidated Balance Sheets –

At December 31, 2022 and 2021

Consolidated Statements of Cash Flows –

Years ended December 31, 2022, 2021, and 2020

Consolidated Statements of Equity –

Years ended December 31, 2022, 2021, and 2020

Consolidated Statements of Operations – Years ended December 31, 2023, 2022, and 2021

Consolidated Statements of Comprehensive Income – Years ended December 31, 2023, 2022, and 2021

Consolidated Balance Sheets – At December 31, 2023 and 2022

Consolidated Statements of Cash Flows – Years ended December 31, 2023, 2022, and 2021

Consolidated Statements of Equity – Years ended December 31, 2023, 2022, and 2021

Notes to Consolidated Financial Statements

1 unchanged sentence

NATIONAL HEALTHCARE CORPORATION

SCHEDULE II –

VALUATION AND QUALIFYING ACCOUNTS

SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS

FOR THE YEARS ENDED DECEMBER 31, 2023, 2022, AND 2021

(in thousands)

Balance–

For the year ended December 31, 2021

Allowance for doubtful accounts

$ 5,672 $ 3,886 $ − $ 3,147 (1) $ 6,411

Accrued risk reserves

$ 96,011  

$ 86,918  

$ 83,392  

$ 99,537  

$ 99,537 $ 82,219 $ − $ 83,708 $ 98,048

For the year ended December 31, 2022

Allowance for doubtful accounts

$ 6,411 $ 4,711 $ − $ 4,876 (1) $ 6,246

Accrued risk reserves

$ 99,537  

$ 82,219  

$ 83,708  

$ 98,048  

$ 98,048 $ 81,743 $ − $ 77,322 $ 102,469

For the year ended December 31, 2023

Allowance for doubtful accounts

$ 6,246 $ 7,424 $ − $ 5,616 (1) $ 8,054

Accrued risk reserves

$ 98,048  

$ 81,743  

$ 77,322  

$ 102,469  

$ 102,469 $ 81,364 $ − $ 80,574 $ 103,259

( 1 ) Amounts written off, net of recoveries

All other financial statement schedules are not required under the related instructions or are inapplicable and therefore have been omitted.

(3)     Exhibits:

EXHIBIT INDEX

Certificate of Incorporation of National HealthCare Corporation

Incorporated by reference to Exhibit 3.1 to the Registrant’s registration statement on Form S–4 (File No.

333–37185) dated October 3, 1997)

Incorporated by reference to Exhibit 3.1 to the Registrant’s registration statement on Form S–4 (File No.

333–37185) dated October 3, 1997)

Certificate of Amendment to the Certificate of Incorporation of National HealthCare Corporation

Incorporated by reference to Exhibit 3.5 attached to Form 10-Q filed on August 3, 2017

Certificate of Designations of Series A Convertible Preferred Stock of National HealthCare Corporation  

Incorporated by reference to Exhibit 2.1 to the current report on Form 8–K filed on December 20, 2006

Certificate of Designations of Series A Convertible Preferred Stock of National HealthCare Corporation

Incorporated by reference to Exhibit 2.1 to the current report on Form 8–K filed on December 20, 2006

Certificate of Designation Series B Junior Participating Preferred Stock

Incorporated by reference to Exhibit 3.1 to the Registrant’s registration statement on Form 8–A, dated August 3, 2007

Restated Bylaws as amended February 14, 2013

Incorporated by reference to Exhibit 3.5 to the quarterly report on Form 10–Q filed on May 8, 2013.

Form of Common Stock

4 unchanged sentences

and National HealthCorp, L.P.

Incorporated by reference to Exhibit 10.1 to the Registrant's registration statement on Form S–4 filed October 3, 1997

Form of Service Agreement by and between National Health Corporation and National HealthCare Corporation

Incorporated by reference to Exhibit 10.5.1 to the Registrant's registration statement on Form S–4 filed October 3, 1997

Amendment No.

1 unchanged sentence

and National HealthCorp L.P.

Incorporated by reference to Exhibit 10.19 from 2005 Form 10–K filed March 16, 2006

Amendment No.

1 unchanged sentence

and National HealthCare L.P.

Incorporated by reference to Exhibit 10.20 from 2005 Form 10–K filed March 16, 2006

Amendment No.

1 unchanged sentence

and National HealthCare L.P.

Incorporated by reference to Exhibit 10.21 from 2005 Form 10–K filed March 16, 2006

Amendment No.

1 unchanged sentence

and National HealthCare L.P.

Incorporated by reference to Exhibit 10.22 from 2005 Form 10–K filed March 16, 2006

Amendment No.

5 to M aster Agreement to Lease between National Health Investors, Inc.

5 to Master Agreement to Lease between National Health Investors, Inc.

and National HealthCare Corporation

Incorporated by reference to Exhibit 10.23 from 2005 Form 10–K filed March 16, 2006

National HealthCare Corporation's 2010 Omnibus Equity Incentive Plan

6 unchanged sentences

Incorporated by reference to Appendix B to 2017 Proxy Statement filed April 4, 2017.

National HealthCare Corporation’s 2020 Omnibus Equity Incentive Plan

National HealthCare Corporation’ s 2020 Omnibus Equity Incentive Plan

Incorporated by reference to Appendix A to 2020 Proxy Statement filed April 6, 2020

1 unchanged sentence

and National HealthCare Corporation

Incorporated by reference to Exhibit 10.1 of National HealthCare Corporation's Form 10–Q filed on November 5, 2013

Agreement to Lease between NHI –

REIT of Northeast, LLC, Landlord and NHC/OP, L.P.

and National HealthCare Corporation, Co –

Incorporated by reference to Exhibit 10.4 of National HealthCare Corporation's Form 10–Q filed on November 5, 2013

Incorporated by reference to Exhibit 10.1 of National HealthCare Corporation's Form 10–Q filed on November 5, 2013

Agreement to Lease between NHI– REIT of Northeast, LLC, Landlord and NHC/OP, L.P.

and National HealthCare Corporation, Co – Tenants

Incorporated by reference to Exhibit 10.4 of National HealthCare Corporation's Form 10–Q filed on November 5, 2013

Amended and Restated Amendment No.

1 unchanged sentence

and National HealthCare Corporation

Incorporated by reference to Exhibit 10.2 of National HealthCare Corporation's Form 10–Q filed on November 5, 2013

Amendment No.

1 unchanged sentence

and National HealthCare Corporation

Incorporated by reference to Exhibit 10.3 of National HealthCare Corporation's Form 10–Q filed on November 5, 2013

Contribution Agreement dated December 29, 2011 between National HealthCare Corporation and Caris HealthCare, L.P.

pursuant to which NHC acquired a 7.5% interest in Caris from McRae in exchange for $7,500,000

Incorporated by reference to Exhibit 10.26 to National HealthCare Corporation's annual report on Form 10–K filed on February 21, 2014

Assignment of membership interest in Solaris Hospice, LLC dated December 29, 2011 and effective on January 1, 2012, whereby NHC assigned its membership interest to Caris in exchange for an additional 2.7% limited partnership interest in Caris.

Incorporated by reference to Exhibit 10.27 to National HealthCare Corporation's annual report on Form 10–K filed on February 21, 2014

Purchase and Sale Agreement and Extension of Master Lease dated December 26, 2012 between National Health Investors, Inc.

and National HealthCare Corporation

Incorporated by reference to Exhibit 10.29 to National HealthCare Corporation's annual report on Form 10–K filed on February 21, 2014

Amendment No.

13 unchanged sentences

Incorporated by reference to Exhibit 10.2 of National HealthCare Corporation's Form 10-Q filed on November 3, 2022

National HealthCare Corporation General Policy on Insider Trading

Filed Herewith

National HealthCare Corporation Compensation Recoupment Policy

Filed Herewith

Code of Ethics of National HealthCare Corporation

Available at NHC’s website www.nhccare.com or in print upon request to:

National HealthCare Corp.

Investor Relations

Murfreesboro, TN 37133–1398

Telephone (615) 890–2020

Murfreesboro, TN 37133–1398

Telephone (615) 890–2020

Subsidiaries of Registrant

Filed Herewith

Consent of Independent Registered Public Accounting Firm – Ernst & Young LLP

Consent of Independent Registered Public Accounting Firm – Ernst & Young LLP

Filed Herewith

Rule 13a–

14(a)/15d –

14(a) Certification  of Chief Executive Officer

Rule 13a–14(a)/15d–14(a) Certification of Chief Executive Officer

Filed Herewith

Rule 13a–

14(a)/15d –

14(a) Certification  of Principal Accounting Officer

Rule 13a–14(a)/15d–14(a) Certification of Chief Financial Officer

Filed Herewith

Certification pursuant to 18 U.S.C.

Section 

1350 by Chief Executive Officer and  Principal Accounting Officer

Section 1350 by Chief Executive Officer and Chief Financial Officer

Filed Herewith

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Inline XBRL Taxonomy Extension Definition Linkbase Document 

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Inline XBRL Taxonomy Extension Presentation Linkbase Document 

Inline XBRL Taxonomy Extension Schema Document

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Inline XBRL Taxonomy Extension Definition Linkbase Document

Inline XBRL Taxonomy Extension Label Linkbase Document

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Cover Page Interactive File (embedded within the Inline XBRL document and included in Exhibit 101)

*Indicates management contract or compensatory plan or arrangement.

FORM 10-K SUMMARY

Not applicable.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

NATIONAL HEALTHCARE CORPORATION

 February 17, 2023

February 16, 2024

/s/ Stephen F.

Chief Executive Officer and Director

5 unchanged sentences

February 16, 2024

Senior Vice President and Controller

Senior Vice President and Chief Financial Officer

(Principal Financial Officer)

(Principal Accounting Officer)

February 16, 2024

11 unchanged sentences

February 16, 2024

/s/ Richard F.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures