Timothy Shelly
NATIONAL HEALTHCAREAbout Timothy Shelly
Timothy J. Shelly is Senior Vice President, Operations at National HealthCare Corporation (NHC), appointed in August 2024. He has been with NHC since 1992, progressing from Administrator-in-Training to Executive Director (Richland Place), then Regional Vice President (Metro Nashville, 2014–2024), and earned NHC “Administrator of the Year” (2002) and “Center of the Year” (2010). He holds a B.B.A. from Belmont University and is 57 years old . Company performance indicators tied to executive pay show Total Shareholder Return (TSR) rising from 121.89 in 2023 to 145.07 in 2024, Net Income of $101.9M in 2024, and Adjusted Income Before Income Taxes of $105.3M in 2024—key levers in the annual bonus pool design .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| NHC – Richland Place (107-bed health care center, 24-unit assisted living, 137-unit independent living) | Executive Director | Pre-2014 | Led operations at a large multi-level care facility; recognized with NHC Center of the Year (2010) . |
| NHC – Metro Nashville Region | Regional Vice President | 2014–2024 | Oversaw multi-facility operations; operational execution across quality, staffing, and financial performance . |
| NHC | Administrator-in-Training; Administrator | 1992 onward | Progression through operations leadership; NHC Administrator of the Year (2002) . |
External Roles
No external directorships or outside roles disclosed for Mr. Shelly in NHC’s latest proxy .
Fixed Compensation
NHC does not disclose Mr. Shelly’s individual base salary in the Named Executive Officer (NEO) tables; he was not a NEO for 2024. However, NHC’s compensation framework—applicable to officers including Shelly—emphasizes below-market base pay relative to peers and higher at-risk incentives . The 2024 executive bonus pool was set at 5% of pre-tax earnings (excluding unrealized gains/losses on marketable securities), with 80% paid in cash and 20% in restricted stock for officers .
| Metric | 2024 | Notes |
|---|---|---|
| Pre-tax earnings excl. unrealized gains/losses ($) | 105,289,176 | Basis for bonus pool calculation. |
| Executive Bonus Pool ($) | 5,264,459 | 5% of adjusted pre-tax earnings. |
| Bonus payout mix | 80% Cash; 20% Restricted Stock | RS computed at $90.95 (close on 2/8/24) with 3-year vest (1/3 Jan 1 each year) . |
Performance Compensation
Officers’ annual incentives are split: at least 40% tied to overall Company financial performance, and 60% to officer-specific operational goals. While Shelly’s individual targets are not disclosed, the plan design and vesting apply to him as a Senior VP .
| Metric | Weighting | Target | Actual | Payout Form | Vesting |
|---|---|---|---|---|---|
| Company financial performance (pre-tax earnings excl. UR gains/losses) | ≥40% | Not disclosed for Shelly | Company achieved $105.3M; pool 5% | 80% cash / 20% RS | RS vests 1/3 on Jan 1, years 1–3 |
| Officer-specific operational goals | 60% | Not disclosed for Shelly | Not disclosed for Shelly | 80% cash / 20% RS | RS 3-year ratable vest |
| Stock options (LTIs) | N/A | Exercise price = grant-date close | Not disclosed for Shelly grants | Options awarded per plan | Vest ratably over 3 years; 5-year expiry |
Notes
- Options are generally granted in March, at market price, 3-year ratable vest, 5-year term; NHC states it has never repriced options .
- The Board and CEO use benchmark data (AON, proxy data) and peer practices to calibrate awards; NHC runs annual say-on-pay, approved by 98% in 2024 .
Equity Ownership & Alignment
Recent insider filing indicates Mr. Shelly exercised options and surrendered shares to cover exercise price/withholding (not open-market selling), ending with 2,454 shares owned directly.
| Item | Detail | Source |
|---|---|---|
| Ending direct holdings | 2,454 shares (11/13/2025 filing) | |
| Transactions (11/11/2025) | Exercised 7,200 shares at $57.28; Surrendered 4,746 shares at $132.20 to cover costs/taxes | |
| Shares outstanding (record date) | 15,461,829 | |
| Ownership % of outstanding | ~0.016% (2,454 / 15,461,829) | Holdings: ; Shares outstanding: |
Alignment and policies
- Hedging prohibited for officers/directors (policy adopted Feb 13, 2020; reaffirmed Nov 7, 2024 insider trading policy) .
- Insider trading policy imposes routine and non-routine blackout periods and trading restrictions .
- Clawback (Compensation Recoupment Policy) adopted Nov 2, 2023 per NYSE American requirements .
- Proxy footnotes indicate some executives hold shares in margin accounts or have pledges (e.g., CEO and CFO), but no such disclosure for Shelly; his pledging status is not disclosed .
Employment Terms
| Term | Status | Notes |
|---|---|---|
| Employment agreement | None | NHC states it does not have employment agreements with executive officers; uses standardized indemnification agreements . |
| Severance multiples | Not disclosed | No contractual severance multiples stated; plan-based benefits only . |
| Change-of-control | Accelerated vesting of outstanding options and restricted stock under 2020 Equity Incentive Plan | CIC would accelerate vesting; proxy quantifies values for NEOs, but Shelly’s specific CIC value not disclosed . |
| Clawback | Adopted Nov 2, 2023 | Applies per NYSE requirements . |
| Hedging/blackouts | Hedging banned; blackout periods enforced | Insider Trading Policy adopted Nov 7, 2024 . |
| Non-compete / non-solicit | Not disclosed | No non-compete/non-solicit terms disclosed in proxy for executives. |
Company Performance Context (Pay vs Performance)
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| NHC TSR (Value of $100) | 79.20 | 83.43 | 75.58 | 121.89 | 145.07 |
| S&P Healthcare Index TSR (Value of $100) | 113.45 | 143.09 | 140.30 | 143.19 | 146.89 |
| Net Income ($) | 41,871,000 | 138,590,000 | 22,445,000 | 66,798,000 | 101,927,000 |
| Adjusted Income Before Income Taxes ($) | 76,270,000 | 163,404,000 | 45,505,000 | 75,304,000 | 105,289,000 |
Notes
- Company-selected pay-performance measure is Adjusted Income Before Income Taxes (adds/subtracts unrealized gains/losses and noncontrolling interests) .
Insider Transactions and Filing Compliance
- Form 4 filed 11/13/2025: Option exercise and share surrender; ending direct holdings 2,454 shares .
- Delinquent Section 16(a): NHC disclosed Mr. Shelly filed a Form 4 thirteen days late in 2024 .
Equity Award Vesting Schedules (Plan Terms)
- Restricted stock from bonus: vests over 3 years, one-third on January 1 of each successive year; example: 2024 bonus RS vests on Jan 1, 2026/2027/2028; 2025 bonus RS will vest Jan 1, 2027/2028/2029 .
- Stock options: vest ratably over 3 years; expire in 5 years; exercise price equals market close on grant date; typically approved in February and granted shortly after (e.g., Mar 5, 2024 grants at $94.10 exercise price) .
Compensation Governance and Framework
- Bonus Pool design: 5% of pre-tax earnings excluding unrealized gains/losses; officer bonuses reflect both company and individualized operational goals; paid 80% cash, 20% RS .
- Peer benchmarking: Compensation Committee uses AON and public proxy disclosures; no employment agreements; standardized indemnification .
- Say-on-pay: 98% approval in 2024; Compensation Committee did not materially revise NEO compensation policies following vote .
- Ownership/pledging context: CEO holds some shares in a margin account; CFO has pledged 5,000 shares—note for governance benchmarking; Shelly’s pledging not disclosed .
Investment Implications
- Alignment and retention: Shelly’s at-risk incentive structure ties a minimum 40% of bonus to company financial performance, with the balance to operations goals—favorable for pay-for-performance and execution alignment . Lack of employment agreement and reliance on plan-based awards suggests limited contractual severance protection, implying some retention risk offset by long tenure and internal progression .
- Insider activity signal: The November 2025 Form 4 shows tax/price-related share surrender with option exercise—no open-market sell; net direct ownership is modest (~0.016% of outstanding), potentially lowering economic alignment vs. larger holders but consistent with NHC’s officer population outside NEOs .
- Governance red flags: A late Form 4 filing in 2024 is a minor compliance blemish; however, NHC’s hedging ban, blackout controls, and clawback policy mitigate behavioral risk around trading and pay outcomes .
- Performance linkage: Strong 2024 Adjusted Income Before Income Taxes and improved TSR underpin the bonus pool and reinforce incentive realizability for operations leadership roles like Shelly’s .
Key watch items: future Form 4s for net accumulation vs. tax-withholding surrenders; disclosure of any pledging or ownership guideline status; operational quality metrics used in Shelly’s individual plan; and changes in bonus pool mechanics or equity mix.