Color the board of National Health Investors impressed with the 2013 put up by President and CEO Justin Hutchens and his team.
The directors of the senior housing real estate investment trust earlier this month handed out the maximum $800,000 worth of performance bonuses Hutchens was entitled to — and then threw in another $200,000 for good measure. NHI in 2013 paid out dividends of $2.90 per share, 13 cents more than the board's threshold that accounts for half of Hutchens' regular $800,000 potential bonus. The directors said a year ago they had the discretion to bump up Hutchens' bonus if NHI's dividends were larger than targeted.
Murfreesboro-based NHI last week reported its final numbers for 2013, saying its normalized funds from operations for the year rose to $3.56 per diluted share, up from $3.18 in 2012. The company runs 171 properties in 30 states that combined are home to more than 17,000 beds.
The compensation committee of NHI's board — made up of Pinnacle Financial Partners Chairman Rob McCabe, local developer Robert Webb and Murfreesboro accountant James Jobe — also tweaked a few details of the contract for Hutchens, who has been the company's CEO since March 2011. The changes call for Hutchens to:
• Continue to receive a fully vested option to buy 100,000 shares of NHI on Feb. 25 of each year as long as he's still with the company;
• Get a stock grant valued at 750,000 times the acquisition premium a buyer might pay for NHI if he does not remain CEO of the combined organization;
• No longer be required to pay $380,000 to the company if he decides to leave his job other than through a "constructive discharge."
The NHI board also approved raises for Hutchens' top lieutenants, Chief Accounting Officer Roger Hopkins and Chief Credit Officer Kristi Gaines. Hopkins' 2014 salary was set at almost $278,500, up 3 percent from last year. Similarly, Gaines' salary was bumped to $156,650 from $146,250.
Shares of NHI (Ticker: NHI) ended trading last week at $60.81 and have ticked up 3 percent over the past three months.
POSTDATA: WARRANTY DEEDS