nrc20210419_10ka.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

(Amendment No. 1)

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended December 31, 2020

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the transition period from ________ to ________

Commission File Number 001-35929

	National Research Corporation
	(Exact name of Registrant as specified in its charter)

Wisconsin		47-0634000
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

	1245 Q Street, Lincoln, Nebraska 68508
	(Address of principal executive offices) (Zip Code)

	(402) 475-2525
	(Registrant’s telephone number, including area code)

Securities registered pursuant to 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.001 par value	NRC	The NASDAQ stock market

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act.) Yes ☐ No ☒

Aggregate market value of the common stock held by non-affiliates of the registrant at June 30, 2020: $653,540,609.

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.

Common Stock, $.001 par value, outstanding as of April 21, 2021: 25,439,013

DOCUMENTS INCORPORATED BY REFERENCE

None.

		Page

EXPLANATORY NOTE		1

PART III

Item 10.	Directors, Executive Officers and Corporate Governance	2
Item 11.	Executive Compensation	5
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters	16
Item 13.	Certain Relationships and Related Transactions, and Director Independence	18
Item 14.	Principal Accountant Fees and Services	19

PART IV

Item 15.	Exhibits	20
Signatures		21

Name	Fees Earned or Paid in Cash		Option Awards⁽¹⁾		Total
Donald M. Berwick	$	50,000	$	100,003	$	150,003

JoAnn M. Martin	$	50,000	$	100,003	$	150,003

Barbara J. Mowry⁽²⁾	$	19,231		-	$	19,231

John N. Nunnelly	$	75,000	$	100,003	$	175,003

	✓	Conservative pay policy with total named executive officer and director compensation positioned below the median
	✓	Direct link between pay and performance that aligns business strategies with stockholder value creation
	✓	Annual say-on-pay votes
	✓	No tax gross-ups
	✓	No excessive perquisites for executives
	✓	No change of control or severance obligations to named executive officers, including no accelerated vesting of equity awards upon a change of control
	✓	No re-pricing or back-dating of stock options or similar awards
	✓	Appropriate balance between short- and long-term compensation that discourages short-term risk taking at the expense of long-term results
	✓	Five year vesting period for executive option grants

Base Salary as a Percentage of Total Compensation

Michael D. Hays	50	%

Kevin R. Karas	50	%

Jona S. Raasch	50	%

Helen L. Hrdy	52	%

Steven D. Jackson	58	%

Name	2020 Actual Bonus Percentage of Total Compensation	2020 Actual Bonus Amount

Michael D. Hays	25%	$62,426

Kevin R. Karas	25%	$139,650

Jona S. Raasch	25%	$147,000

Helen L. Hrdy	25%	$139,650

Steven D. Jackson⁽¹⁾	0%	$0

Name and Principal Position	Year	Salary ($)		Option Awards ($)⁽¹⁾		Non-Equity Incentive Plan Compensation ($)		All Other Compensation ($)⁽²⁾		Total ($)

Michael D. Hays⁽³⁾	2020	$	127,400	$	60,258	$	62,426	$	4,420	$	254.504
Chief Executive Officer	2019	$	127,400	$	54,890	$	47,265	$	4,323	$	233,878
President	2018	$	127,400	$	53,332	$	104,468	$	4,267	$	289,467

Kevin R. Karas	2020	$	285,000	$	134,813	$	139,650	$	6,868	$	566,331
Senior Vice President	2019	$	285,000	$	122,782	$	105,735	$	6,529	$	520,046
Finance, Chief Financial Officer,	2018	$	285,000	$	119,307	$	233,700	$	6,604	$	644,611
Treasurer and Secretary

Jona S. Raasch	2020	$	300,000	$	141,909	$	147,000	$	6,914	$	595,823
Chief Operating Officer

Helen L. Hrdy	2020	$	285,000	$	118,254	$	139,650	$	5,410	$	548,314
Chief Growth Officer

Steven D. Jackson⁽³⁾	2020	$	225,000	$	141,909	$	0	$	20,363	$	387,272
Former President	2019	$	300,000	$	129,239	$	111,300	$	5,100	$	545,639
	2018	$	300,000	$	125,582	$	246,000	$	5,025	$	676,607

			Estimated Future Payouts Under Non-Equity Incentive Plan Awards⁽¹⁾
Name	Grant Date	Date of Committee Action	Threshold ($)⁽³⁾		Target ($)		Maximum ($)		All Other Option Awards: No. of Securities Underlying Options (#)⁽²⁾		Exercise or Base Price of Option Awards ($)⁽²⁾		Closing Price on Date of Grant ($)		Grant Date Fair Value of Stock and Option Awards ($)

Michael D. Hays	1/3/2020	12/20/19								2,904	$	65.80	$	66.80	$	60,258

				-	$	63,700	$	254,800

Kevin R. Karas	1/3/2020	12/20/19								6,497	$	65.80	$	66.80	$	134,813

				-	$	142,500	$	570,000

Jona S. Raasch	1/3/2020	12/20/19								6,839	$	65.80	$	66.80	$	141,909

				-	$	150,000	$	600,000

Helen L. Hrdy	1/3/2020	12/20/19								5,699	$	65.80	$	66.80	$	118,254

				-	$	142,500	$	570,000

Steven D. Jackson	1/3/2020	12/20/19								6,839	$	65.80	$	66.80	$	141,909

				-	$	150,000	$	600,000

	Option Awards
Name	No. of Securities Underlying Unexercised Options (Exercisable) (#)			No. of Securities Underlying Unexercised Options (Unexercisable) (#)			Option Exercise Price ($)		Option Expiration Date


Michael D. Hays		17,745	⁽¹⁾⁽²⁾		-		$	9.14	01/05/21
		14,949	⁽¹⁾⁽³⁾		-		$	10.75	01/05/22
		10,938	⁽¹⁾⁽⁴⁾		-		$	14.50	01/07/23
		2,904	⁽¹⁾⁽⁵⁾		-		$	18.80	01/07/24
		10,014	⁽¹⁾⁽⁶⁾		-		$	13.17	01/06/25
		-			9,145	⁽¹⁾⁽⁷⁾	$	15.23	01/05/26
		-			7,478	⁽¹⁾⁽⁸⁾	$	18.80	01/04/27
		-			5,193	⁽¹⁾⁽⁹⁾	$	36.80	01/03/28
		-			4,990	^(1)(10)	$	38.30	01/03/29
		-			2,904	^(1)(11)	$	65.80	01/03/30

Kevin R. Karas		5,334	⁽¹⁾⁽⁵⁾		-		$	18.80	01/07/24
		19,313	⁽¹⁾⁽⁶⁾		-		$	13.17	01/06/25
		-			20,458	⁽¹⁾⁽⁷⁾	$	15.23	01/05/26
		-			16,728	⁽¹⁾⁽⁸⁾	$	18.80	01/04/27
		-			11,617	⁽¹⁾⁽⁹⁾	$	36.80	01/03/28
					11,162	^(1)(10)	$	38.30	01/03/29
					6,497	^(1)(11)	$	65.80	01/03/30

Jona S. Raasch		23,581	⁽¹⁾⁽⁶⁾		-		$	13.17	01/06/25
		-			21,535	⁽¹⁾⁽⁷⁾	$	15.23	01/05/26
		-			17,608	⁽¹⁾⁽⁸⁾	$	18.80	01/04/27
		-			12,228	⁽¹⁾⁽⁹⁾	$	36.80	01/03/28
		-			11,749	^(1)(10)	$	38.30	01/03/29
		-			6,8391)	⁽¹¹⁾	$	65.80	01/03/30

Helen L. Hrdy		13,520	⁽¹⁾⁽⁶⁾		-		$	13.17	01/06/25
		-			12,346	⁽¹⁾⁽⁷⁾	$	15.23	01/05/26
		-			12,619	⁽¹⁾⁽⁸⁾	$	18.80	01/04/27
		-			8,764	⁽¹⁾⁽⁹⁾	$	36.80	01/03/28
		-			8,420	^(1)(10)	$	38.30	01/03/29
		-			5,699	^(1)(11)	$	65.80	01/03/30

Steven D. Jackson		-			-			-		-

	Option Awards				Stock Awards
Name	Number of Shares Acquired on Exercise (#)⁽¹⁾		Value Realized on Exercise ($)⁽²⁾		Number of Shares Acquired on Vesting (#)^{(1) (3)}		Value Realized on Vesting ($)⁽³⁾
Michael D. Hays		26,481	$	1,575,620		-		-
Kevin R. Karas		20,088	$	858,159		-		-
Jona S. Raasch		-		-		-		-
Helen L. Hrdy		20,196	$	999,702		-		-
Steven D. Jackson		-		-		52,477	$	2,940,949

⁽¹⁾	Shares of common stock.
⁽²⁾	Amounts represent the product of the number of shares acquired on exercise multiplied by the excess of the closing market price per share on the date of exercise over the exercise price per share.
⁽³⁾	15,721 shares vested on January 6, 2020 and 36,756 shares vested on October 1, 2020. The market value is based on the $68.30 and $50.80 per share closing prices of our common stock on The NASDAQ Stock Market on January 6, 2020 and October 1, 2020, respectively.

	Shares Beneficially Owned
Name of Beneficial Owner	Shares			% ⁽¹⁾
Directors and Executive Officers ⁽²⁾

Michael D. Hays		223,794	⁽³⁾⁽⁴⁾		*
Kevin R. Karas		42,754	⁽⁴⁾⁽⁵⁾		*
Jona S. Raasch		95,735	⁽⁴⁾⁽⁶⁾		*
Helen L. Hrdy		58,691	⁽⁴⁾		*
Steven D. Jackson		55,567			*
Donald M. Berwick		14,540			*
JoAnn M. Martin		199,395			*
John N. Nunnelly		76,569	⁽⁴⁾		*
All directors and executive officers as a group (ten persons)		767,045	⁽⁴⁾		3.0	%

Other Holders

Amandla MK Trust and Patrick E. Beans, as the Special Holdings Direction Advisor under this Trust ⁽⁷⁾		6,363,278			25.0	%

Common Property Trust, Common Property Trust LLC and Thomas Richardson, as Trustee of Common Property Trust and Manager of Common Property Trust LLC⁽⁸⁾		4,772,522			18.8	%

Kayne Anderson Rudnick Investment Management LLC ⁽⁹⁾		3,334,366			13.1	%

Plan Category Common Shares	Number of securities to be issued upon the exercise of outstanding options, warrants and rights		Weighted- average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in the first column)
Equity compensation plans approved by security holders⁽¹⁾		600,571	$	25.31		1,610,219	⁽²⁾
Equity compensation plans not approved by security holders		--		--		--
Total		600,571	$	25.31		1,610,219

	2020		2019
Audit Fees⁽¹⁾	$	457,810	$	449,748
Audit-Related Fees⁽²⁾		134,500		134,726
Tax Fees⁽³⁾		83,285		203,336
All Other Fees		--		--
Total	$	675,595	$	787,810

⁽¹⁾	Audit of annual financial statements, review of financial statements included in Form 10-Q and other services normally provided in connection with statutory and regulatory filings, including out-of-pocket expenses.
⁽²⁾	Information security audit services, including out-of-pocket expenses.
⁽³⁾	Tax consultations and tax return preparation including out-of-pocket expenses. Of this amount, $71,727 related to tax return preparation services and $11,558 related to tax consulting services.

Exhibit Number	Exhibit Description

(31.1)**	Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

(31.2)**	Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

	NATIONAL RESEARCH CORPORATION

	By:	/s/ Michael D. Hays
		Michael D. Hays
		Chief Executive Officer and President

Signature	Title	Date

/s/ Michael D. Hays	Chief Executive Officer, President and Director	April 28, 2021
Michael D. Hays	(Principal Executive Officer)


/s/ Kevin R. Karas	Senior Vice President Finance, Chief Financial	April 28, 2021
Kevin R. Karas	Officer, Treasurer and Secretary (Principal
	Financial and Accounting Officer)

/s/ Donald M. Berwick	Director	April 28, 2021
Donald M. Berwick

/s/ JoAnn M. Martin	Director	April 28, 2021
JoAnn M. Martin

/s/ John N. Nunnelly	Director	April 28, 2021
John N. Nunnelly

SEC Form 10-K/A filed by National Research Corporation (Amendment)