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Stock-Based Compensation
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation STOCK-BASED COMPENSATION
All stock-based awards are subject to the terms of the CareTrust REIT, Inc. and CTR Partnership, L.P. Incentive Award Plan (the “Plan”). The Plan provides for the granting of stock-based compensation, including stock options, restricted stock, performance awards, restricted stock units, relative total stockholder return-based stock awards and other incentive awards to officers, employees and directors in connection with their employment with or services provided to the Company. Under the Plan, 5,000,000 shares have been authorized for awards.
Under the Plan, restricted stock awards (“RSAs”) vest in equal annual installments beginning on the first anniversary of the grant date over a three year period for the RSAs granted in 2022 and 2021 and a four year period for the RSAs granted in 2020. RSAs granted to non-employee members of the Board of Directors (“Board Awards”) vest in full on the earlier to occur of the Company’s next Annual Meeting of Stockholders or one year. Performance stock awards (“PSA”) granted are subject to both time and performance based conditions and vest over a one-to three year period for PSAs granted in 2021 and over a one-to-four year period for PSAs granted in 2020. The amount of such PSAs that will ultimately vest is dependent on the Company’s Normalized Funds from Operations (“NFFO”) per share, as defined by the Compensation Committee, meeting or exceeding a specified per share amount for the applicable vesting period. Relative total shareholder return units (“TSR Units”) granted in 2022 and 2021 are subject to both time and market based conditions and cliff vest after a three-year period. The amount of such market awards that will ultimately vest is dependent on the Company’s total shareholder return (“TSR”) performance relative to a custom TSR peer group consisting of other publicly traded healthcare REITs and will range from 0% to 200% of the TSR Units initially granted. The RSAs, PSAs, and Board Awards are valued on the date of grant based on the closing price of the Company’s common stock, while the TSR Units are valued on the date of grant using a Monte Carlo valuation model. The vesting of certain awards may accelerate, as defined in the grant agreement, upon retirement, a change in control or other events.
The following table summarizes the status of the restricted stock award and performance award activity for the year ended December 31, 2022:
SharesWeighted Average Share Price
Unvested balance at December 31, 2021891,333 $20.91 
Granted:
RSAs159,663 19.56 
Board Awards25,992 16.93 
Vested(501,479)20.60 
Forfeited(1,900)21.50 
Unvested balance at December 31, 2022573,609 $20.63 
As of December 31, 2022, the weighted-average remaining vesting period of such awards was 1.9 years.
The following table summarizes the Company’s RSA, PSA and Board Award grants during the year ended December 31, 2022 (dollars in thousands, except per share amounts):
GrantsVested
SharesWeighted Average Share PriceGrant Date Fair ValueSharesVest Date Fair Value
During year ended December 31, 2022(1)
RSAs159,663 $19.56 $3,123 263,568 $5,020 
PSAs— — — 217,645 4,134 
Board Awards25,992 16.93 440 20,266 346 
(1) The Compensation Committee granted annual awards for 2023 in December 2022.
The following table summarizes the Company’s RSA, PSA and Board Award grants during the years ended December 31, 2021 and 2020 (dollars in thousands, except per share amounts):
Grants
SharesWeighted Average Share PriceGrant Date Fair Value
During year ended December 31, 2021(1)
RSAs394,863 $21.92 $8,654 
PSAs108,414 22.48 2,437 
Board Awards20,266 24.18 490 
During year ended December 31, 2020
RSAs134,790 $19.68 $2,653 
PSAs107,790 19.06 2,054 
Board Awards27,611 16.48 455 
(1) In 2021, the Compensation Committee changed the structure of the grants that resulted in two long-term equity incentive awards being granted to the Company’s named executive officers in 2021. The Compensation Committee also granted annual awards for 2022 in December 2021.
The fair value of the TSR Units is estimated on the date of the grant using a Monte Carlo valuation model. The risk-free rate is based on the U.S. Treasury yield curve in effect at the grant date for the expected performance period. Expected volatility is based on historical volatility for the most recent weighted average period ending on the grant date for the Company and the selected TSR peer group, and is calculated on a daily basis. The following table reflects the weighted-average key assumptions used in this valuation for awards granted during the year ended December 31, 2022 and 2021:
For the Year Ended December 31, 2022
For the Year Ended December 31, 2021
Risk-free interest rate3.91 %0.60 %
Expected stock price volatility52.90 %52.42 %
Expected service period3.04 years2.93 years
Expected dividend yield (assuming full reinvestment)— %— %
Fair value per share at date of grant$26.53 $29.10 
The total fair value of the TSR Units granted during the year ended December 31, 2022 and 2021 was $2.5 million and $5.3 million, respectively.
The following table summarizes the stock-based compensation expense recognized (dollars in thousands):
 For Year Ended December 31,
 202220212020
Stock-based compensation expense$5,758 $10,832 $3,790 
As of December 31, 2022, there was $11.6 million of unamortized stock-based compensation expense related to the unvested RSAs, PSAs, Board Awards, and TSR Units.