EX-13 4 g00130exv13.txt EX-13 FINANCIAL STATEMENT SCHEDULES EXHIBIT 13 NATIONAL HEALTH INVESTORS, INC. INDEX TO FINANCIAL STATEMENT SCHEDULES Financial Statement Schedules Report of Independent Registered Public Accounting Firm on Financial Statement Schedules Schedule II - Valuation and Qualifying Accounts Schedule III - Real Estate and Accumulated Depreciation Schedule IV - Mortgage Loans on Real Estate REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors and Stockholders National Health Investors, Inc. Murfreesboro, Tennessee The audits referred to in our report dated February 22, 2006 relating to the consolidated financial statements of National Health Investors, Inc., which is contained in Item 8 of this Form 10-K included the audits of the 2005 and 2004 financial statement schedules listed in the accompanying index. These financial statement schedules are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statement schedules based upon our audits. In our opinion such financial statement schedules present fairly in all material respects, the information set forth therein. /s/ BDO Seidman, LLP Memphis, Tennessee February 22, 2006 NATIONAL HEALTH INVESTORS, INC. SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS FOR THE YEARS ENDED DECEMBER 31, 2005, 2004, AND 2003 (in thousands)
Column A Column B Column C Column D Column E ------------------- --------- ---------------- ---------- ------------- Balance- Additions Beginning Charged to Costs Balance - Description of Period and Expenses Deductions End of Period ------------------- --------- ---------------- ---------- ------------- For the year ended December 31, 2003 - Loan loss allowance $ -- $ 3,500 $ 3,500 $ -- For the year ended December 31, 2004 - Loan loss allowance $ -- $ -- $ -- $ -- For the year ended December 31, 2005 - Loan loss allowance $ -- $ 5,435 $ 5,435 $ --
NATIONAL HEALTH INVESTORS, INC. SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2005
Column A Column B Column C Column D Column E ------------------------ -------- ----------------------- ----------------- ----------------------------- Cost capitalized Gross amount at which subsequent to carried at close Initial Cost to Company acquisition of period ----------------------- ----------------- ----------------------------- Encum- Buildings & Improve- Carrying Buildings & Properties brances Land Improvements ments Costs Land Improvements Total ------------------------ -------- --------- ------------- -------- -------- ------- ------------ -------- (dollars in thousands) Health Care Centers (2) Alabama $ 1 $ 95 $ 5,165 $ -- $ -- $ 95 $ 5,165 $ 5,260 Health Care Centers (1) Arizona 1,950 453 6,678 -- -- 453 6,678 7,131 Health Care Centers (4) Florida 1,097 2,306 37,511 -- -- 2,306 37,511 39,817 Health Care Centers (1) Georgia -- 52 865 -- -- 52 865 917 Health Care Centers (1) Idaho -- 122 2,491 -- -- 122 2,491 2,613 Health Care Centers (7) Kansas -- 658 12,512 -- -- 658 12,512 13,170 Health Care Centers (2) Kentucky -- 231 2,182 -- -- 231 2,182 2,413 Health Care Centers (4) Massachusetts -- 1,189 18,665 -- -- 1,189 18,665 19,854 Health Care Centers (9) Missouri 2,725 1,988 36,203 -- -- 1,988 36,203 38,191 Health Care Centers (3) New Hampshire -- 1,473 22,870 -- -- 1,473 22,870 24,343 Health Care Centers (2) New Jersey -- 1,096 11,973 -- -- 1,096 11,973 13,069 Health Care Centers (3) South Carolina -- 572 11,544 -- -- 572 11,544 12,116 Health Care Centers (20) Tennessee 13 1,835 41,312 -- -- 1,835 41,312 43,147 Column A Column F Column G Column H ------------------------ ------------ ------------ ---------- Accumulated Date of Date Properties Depreciation Construction Acquired ------------------------ ------------ ------------ ---------- Health Care Centers (2) Alabama $ 3,086 N/A 10/17/91 Health Care Centers (1) Arizona 1,668 N/A 8/13/96 Health Care Centers (4) Florida 17,929 N/A 10/17/91 & 12/31/99 Health Care Centers (1) Georgia 721 N/A 10/17/91 Health Care Centers (1) Idaho 637 N/A 8/13/96 Health Care Centers (7) Kansas 1,980 N/A 8/1/01 & 10/31/04 Health Care Centers (2) Kentucky 1,301 N/A 10/17/91 Health Care Centers (4) Massachusetts 8,832 N/A 8/10/99 Health Care Centers (9) Missouri 13,984 N/A 10/17/91 & 8/1/01 Health Care Centers (3) New Hampshire 10,997 N/A 8/10/99 Health Care Centers (2) New Jersey 1,070 N/A 1/1/03 Health Care Centers (3) South Carolina 7,092 N/A 10/17/91 Health Care Centers (20) Tennessee 23,199 N/A 10/17/91
NATIONAL HEALTH INVESTORS, INC. SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2005
Column A Column B Column C Column D Column E ------------------------ -------- ----------------------- ----------------- ----------------------------- Cost capitalized Gross amount at which subsequent to carried at close Initial Cost to Company acquisition of period ----------------------- ----------------- ----------------------------- Encum- Buildings & Improve- Carrying Buildings & Properties brances Land Improvements ments Costs Land Improvements Total ------------------------ -------- --------- ------------- -------- -------- ------- ------------ -------- Health Care Centers (8) Texas -- 2,280 47,409 -- -- 2,280 47,409 49,689 Health Care Centers (1) Virginia 2,400 176 2,510 -- -- 176 2,510 2,686 Health Care Centers (1) Wisconsin -- 170 1,604 -- -- 170 1,604 1,774 Acute Care Hospital (1) Kentucky -- 540 10,163 -- -- 540 10,163 10,703 Medical Office Building (1) Florida -- 165 3,349 -- -- 165 3,349 3,514 Medical Office Building (1) Illinois -- -- 1,925 -- -- -- 1,925 1,925 Medical Office Building (2) Texas -- 631 9,677 -- -- 631 9,677 10,308 Assisted Living Centers (4) Arizona -- 1,757 13,622 -- -- 1,757 13,622 15,379 Assisted Living Centers (5) Florida -- 7,096 20,194 -- -- 7,096 20,194 27,290 Assisted Living Centers (1) New Jersey -- 4,229 13,030 -- -- 4,229 13,030 17,259 Assisted Living Centers(1) Pennsylvania -- 440 3,960 -- -- 440 3,960 4,400 Assisted Living Centers (1) South Carolina -- 344 2,877 -- -- 344 2,877 3,221 Column A Column F Column G Column H ------------------------ ------------ ------------ ---------- Accumulated Date of Date Properties Depreciation Construction Acquired ------------------------ ------------ ------------ ---------- Health Care Centers (8) Texas 6,741 N/A 9/1/01 & 3/16/05 Health Care Centers (1) Virginia 1,333 N/A 10/17/91 Health Care Centers (1) Wisconsin 83 N/A 10/31/04 Acute Care Hospital (1) Kentucky 3,455 N/A 6/12/92 Medical Office Building (1) Florida 1,483 N/A 6/30/93 Medical Office Building (1) Illinois 397 12/31/98 N/A Medical Office Building (2) Texas 3,450 1/1/95 N/A & 7/31/97 Assisted Living Centers (4) Arizona 2,354 N/A 12/31/98 & 3/31/99 Assisted Living Centers (5) Florida 7,724 N/A 8/6/96, 12/31/98 & 1/1/99 Assisted Living Centers (1) New Jersey 3,970 N/A 8/6/96 Assisted Living Centers(1) Pennsylvania 33 N/A 9/1/05 Assisted Living Centers (1) South Carolina 500 N/A 12/31/98
NATIONAL HEALTH INVESTORS, INC. SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 2005
Column A Column B Column C Column D Column E ------------------------ -------- ----------------------- ----------------- ----------------------------- Cost capitalized Gross amount at which subsequent to carried at close Initial Cost to Company acquisition of period ----------------------- ----------------- ----------------------------- Encum- Buildings & Improve- Carrying Buildings & Properties brances Land Improvements ments Costs Land Improvements Total ------------------------ -------- --------- ------------- -------- -------- ------- ------------ -------- Assisted Living Centers (3) Tennessee -- 871 7,061 -- -- 871 7,061 7,932 Retirement Center (1) Idaho -- 243 4,182 -- -- 243 4,182 4,425 Retirement Center (1) Missouri -- 353 3,171 -- -- 353 3,171 3,524 Retirement Center (1) New Hampshire -- 218 2,917 -- -- 218 2,917 3,135 Retirement Centers (2) Tennessee -- 64 5,644 -- -- 64 5,644 5,708 ------- -------- ----------- ------ ------ ------- ---------- -------- $ 8,186 $ 31,647 $ 363,266 $ -- $ -- $31,647 $ 363,266 $394,913 ======= ======== =========== ====== ====== ======= ========== ======== Column A Column F Column G Column H ------------------------ ------------ ------------ ---------- Accumulated Date of Date Properties Depreciation Construction Acquired ------------------------ ------------ ------------ ---------- Assisted Living Centers (3) Tennessee 1,210 N/A 12/31/98 & 3/31/99 Retirement Center (1) Idaho 1,043 N/A 8/13/96 Retirement Center (1) Missouri 1,590 N/A 10/17/91 Retirement Center (1) New Hampshire 1,533 N/A 8/10/99 Retirement Centers (2) Tennessee 2,389 N/A 10/17/91 ---------- $ 131,784 ==========
NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION (A) See Notes 3 and 18 of Notes to Consolidated Financial Statements. (B) The aggregate cost for federal income tax purposes is approximately $367,840,000. (C) Depreciation is calculated using depreciation lives up to 40 years for all completed facilities. (D) Subsequent to NHC's transfer of the original real estate properties in 1991, NHI has purchased from NHC $33,909,000 of additions to those properties. As the additions were purchased from NHC rather than developed by NHI, the $33,909,000 has been included in Column C - Initial Cost to the Company. NATIONAL HEALTH INVESTORS, INC. SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION FOR THE YEARS ENDED DECEMBER 31, 2005, 2004 AND 2003
December 31 ------------------------------------ 2005 2004 2003 ---------- ---------- ---------- Investment in Real Estate: Balance at beginning of period $ 402,067 $ 400,403 $ 403,049 Additions through cash expenditures 12,264 1,678 627 Additions in exchange for rights under mortgage notes receivable -- 4,324 13,069 Sale of properties for cash (16,868) (4,340) (10,917) Impairment write-downs (2,550) -- (5,400) Other -- 2 (25) ---------- ---------- ---------- Balance at end of year $ 394,913 $ 402,067 $ 400,403 ========== ========== ========== Accumulated Depreciation: Balance at beginning of period $ 123,897 $ 110,938 $ 98,655 Addition charged to costs and expenses 12,855 14,453 15,380 Sale of properties (4,968) (1,494) (3,097) ---------- ---------- ---------- Balance at end of year $ 131,784 $ 123,897 $ 110,938 ========== ========== ==========
NATIONAL HEALTH INVESTORS, INC. SCHEDULE IV - MORTGAGE LOANS ON REAL ESTATE DECEMBER 31, 2005
Column A Column B Column C Column D Column E ------------------------------------ ------------- --------------------- ---------- -------- Final Monthly Interest Maturity Payment Prior Description Rate Date Terms Liens ------------------------------------ ------------- --------------------- ---------- -------- First Mortgage Loans: Florida 10.0% December, 2006 $ 252,000 None Augusta and Pooler, Georgia 11.0% December, 2006 5,000 None Augusta and Pooler, Georgia 9.25% April, 2006 -- None Williston and Gainesville, Florida 8.0% May, 2009 66,000 None (A)(D) Ocoee, Florida (A) 8.0% May, 2009 46,000 None Augusta and Pooler, Georgia(A)(B)(D) 9.5% January, 2009 135,000 None Tucker, GA (A) 9.5% January, 2009 66,000 None Dallas, Texas (C)(D) 12.25% September, 2010 186,000 None Atlanta, Georgia (A) 6.5% September, 2013 22,000 None Friendswood, Richmond, Sugarland, Conroe, Beaumont, Huntsville, Cleveland, Liberty, and Tomball, Texas (A)(D)(E) 10.50% September, 2014 353,000 None Six Mortgages(D) 6.0% -9.5% Dec. 2005 - Dec. 2011 46,000 None (under $2,500,000 each) Three Mortgages(D) 10.00%-10.50% Sept. 2006 - Nov. 2008 106,000 None ($923,000 to $3,370,000 each) Column A Column F Column G Column H ------------------------------------ ------------ --------------- --------------- Principal Amount of Loan Subject Original To Delinquent Face Amount Carrying Amount Principal or Description of Mortgages of Mortgages Interest ------------------------------------ ------------ --------------- --------------- First Mortgage Loans: Florida $ 25,900,000 $ 22,673,000 None Augusta and Pooler, Georgia 4,000,000 2,897,000 None Augusta and Pooler, Georgia 800,000 135,000 None Williston and Gainesville, Florida 8,500,000 2,281,000 None (A)(D) Ocoee, Florida (A) 6,000,000 3,649,000 None Augusta and Pooler, Georgia(A)(B)(D) 15,242,000 7,201,000 $13,944,000 Tucker, GA (A) 7,508,000 3,618,000 6,772,000 Dallas, Texas (C)(D) 18,000,000 8,028,000 None Atlanta, Georgia (A) 5,158,000 994,000 None Friendswood, Richmond, Sugarland, Conroe, Beaumont, Huntsville, Cleveland, Liberty, and Tomball, Texas (A)(D)(E) 51,500,000 24,071,000 None Six Mortgages(D) 7,715,000 4,917,000 None (under $2,500,000 each) Three Mortgages(D) 11,396,000 7,010,000 None ($923,000 to $3,370,000 each)
NATIONAL HEALTH INVESTORS, INC. SCHEDULE IV - MORTGAGE LOANS ON REAL ESTATE (Continued) DECEMBER 31, 2005
Column A Column B Column C Column D Column E ------------------------------------ ------------- --------------------- ---------- -------- Final Monthly Interest Maturity Payment Prior Description Rate Date Terms Liens ------------------------------------ ------------- --------------------- ---------- -------- Osceola, Florida 9.5% January, 2009 $ 70,000 None Dripping Springs, Gainesville, Texas 9.0% March, 2019 19,000 None Seven Mortgages, Virginia 8.0%-9.6% August 2027 to June 2032 165,000 None ($2,134,000 to $3,935,000 each) Column A Column F Column G Column H ------------------------------------ ------------ --------------- --------------- Principal Amount of Loan Subject Original To Delinquent Face Amount Carrying Amount Principal or Description of Mortgages of Mortgages Interest ------------------------------------ ------------ --------------- --------------- Osceola, Florida $ 7,900,000 $ 7,150,000 None Dripping Springs, Gainesville, Texas 2,500,000 2,500,000 None Seven Mortgages, Virginia 20,774,000 18,777,000 None ------------ ($2,134,000 to $3,935,000 each) $115,901,000 ============
NOTES TO SCHEDULE IV - MORTGAGE LOANS ON REAL ESTATE (A) The Company has reduced the carrying amount of this mortgage loan by a reserve or write-off calculated in accordance with the provisions of Statement of Financial Accounting Standards 114, "Accounting by Creditors for Impairment of a Loan - An Amendment of FASB Statements No. 5 and 15". The reserve or write-off is based on the Company's knowledge of the general economic condition in the long-term health care industry and the cash flows of the long-term health care facilities that service the mortgage loan. (B) Balloon payment of $12,923,000 due at maturity. (C) Interest at the greater of 12.25% or the rate that five-year United States securities yield plus 4.5%. (D) Mortgages provide for prepayment penalties. (E) Note A is at 10.50% and matures September, 2014. Note B is at the prime rate. (1) See Note 4 of Notes to Consolidated Financial Statements. (2) For tax purposes, the cost of investments is the carrying amount. (3) Other, non-mortgage notes receivable unrelated to real estate of $2,899,000 at December 31, 2005 are not reported on this schedule. NATIONAL HEALTH INVESTORS, INC. SCHEDULE IV - MORTGAGE LOANS ON REAL ESTATE (continued) FOR THE YEARS ENDED DECEMBER 31, 2005, 2004 AND 2003
December 31 -------------------------------- 2005 2004 2003 --------- --------- --------- (in thousands) Reconciliation of mortgage loans Balance at beginning of period $ 109,046 $ 142,155 $ 176,492 Additions: New mortgage loans 22,079 2,419 1,730 --------- --------- --------- Total Additions 22,079 2,419 1,730 --------- --------- --------- Deductions during period: Loans written off 5,435 -- 3,500 Collection of principal 9,789 13,694 19,498 Sale of mortgage loans -- 17,510 -- Acquisition of property and equipment in exchange for rights under mortgage loans -- 4,324 13,069 --------- --------- --------- Total Deductions 15,224 35,528 36,067 --------- --------- --------- Balance at end of period $ 115,901 $ 109,046 $142,155 ========= ========== =========