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INCENTIVE STOCK PLANS
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
INCENTIVE STOCK PLANS INCENTIVE STOCK PLANS
The Rayonier Incentive Stock Plan (the “Stock Plan”) provides up to 15.8 million shares to be granted for incentive stock options, non-qualified stock options, stock appreciation rights, performance shares, restricted stock and restricted stock units, subject to certain limitations. At December 31, 2022, a total of 1.8 million shares were available for future grants under the Stock Plan. Under the Stock Plan, shares available for issuance are reduced by 1 share for each option or right granted and by 2.27 shares for each performance share, restricted share or restricted stock unit granted. We issue new shares of stock upon the exercise of stock options, the granting of restricted stock, and the vesting of performance shares and restricted stock units. The Stock Plan allows for the cash settlement of the required withholding tax on share or unit awards.
A summary of our stock-based compensation cost is presented below:
 202220212020
Selling and general expenses$10,767 $8,255 $6,839 
Cost of sales1,226 816 693 
Timber and Timberlands, net (a)363 206 170 
Other operating expense, net (b)— — 324 
Total stock-based compensation$12,356 $9,277 $8,026 
Tax benefit recognized related to stock-based compensation expense (c)$603 $487 $421 
(a)Represents amounts capitalized as part of the overhead allocation of timber-related costs.
(b)Represents expense associated with the acceleration of share-based compensation on Pope replacement awards related to qualifying terminations.
(c)A valuation allowance is recorded against the tax benefit recognized as we do not expect to be able to realize the benefit in the future.
FAIR VALUE CALCULATIONS BY AWARD
RESTRICTED STOCK & RESTRICTED STOCK UNITS
Restricted stock units granted to employees under the Stock Plan generally vest in fourths on the first, second, third and fourth anniversary of the grant date. Periodically, other one-time restricted stock unit grants are issued to employees for special purposes, such as new hire, promotion or retention, and can vest ratably over, or upon completion of, a defined period of time. Holders of unvested restricted stock and restricted stock unit awards receive dividend equivalent payments on outstanding awards. Members of the board of directors are granted restricted stock, which vests immediately upon issuance and is subject to certain holding requirements. The fair value of each share granted is equal to the share price of the Company’s stock on the date of grant. We have elected to value each grant in total and recognize the expense on a straight-line basis from the grant date of the award to the latest vesting date. As permitted, we do not estimate a forfeiture rate for non-vested shares. Accordingly, unexpected forfeitures will lower stock-based compensation during the period in which they occur.
As of December 31, 2022, there was $0.1 million of unrecognized compensation cost attributable to our restricted stock. We expect to recognize this cost over a weighted average period of 5 months. As of December 31, 2022, there was $7.1 million of unrecognized compensation cost attributable to our restricted stock units. We expect to recognize this cost over a weighted average period of 2.1 years.
A summary of our restricted stock is presented below:
202220212020
Restricted shares granted (a)22,800 22,140 100,452 
Weighted average price of restricted shares granted$38.60 $37.36 $23.15 
Intrinsic value of restricted stock outstanding (b)$620 $3,062 $4,666 
Grant date fair value of restricted stock vested2,478 3,121 2,755 
Cash used to purchase common shares from current and former employees to pay withholding tax requirements on restricted shares vested708 869 566 
(a)The year ended December 31, 2020 includes 69,176 replacement awards issued as a result of the merger with Pope Resources.
(b)Intrinsic value of restricted stock outstanding is based on the market price of the Company’s stock at December 31, 2022.
 2022
Number of
Shares		Weighted
Average Grant
Date Fair Value
Non-vested Restricted Shares at January 1,75,862 $29.29 
Granted22,800 38.60 
Vested (a)(78,607)31.52 
Cancelled(1,247)24.32 
Non-vested Restricted Shares at December 31,18,808 $31.58 
(a)The year ended December 31, 2022 includes 3,718 replacement awards vested as a result of acceleration due to qualifying terminations.
A summary of our restricted stock units is presented below:
 202220212020
Restricted stock units granted130,213 129,290 171,409 
Weighted average price of restricted stock units granted$41.81 $33.59 $22.58 
Intrinsic value of restricted stock units outstanding (a)$13,826 $15,095 $7,801 
Grant date fair value of restricted stock units vested2,475 493 218 
Cash used to purchase common shares from current and former employees to pay withholding tax requirements on restricted stock units vested1,063 189 47 
(a)Intrinsic value of restricted stock units outstanding is based on the market price of the Company’s stock at December 31, 2022.
 2022
 Number of
Shares		Weighted
Average Grant
Date Fair Value
Non-vested Restricted Stock Units at January 1,374,016 $28.44 
Granted130,213 41.81 
Vested(80,857)30.61 
Cancelled(3,888)33.72 
Non-vested Restricted Stock Units at December 31,419,484 $32.12 
PERFORMANCE SHARE UNITS
Our performance share units generally vest upon completion of a three-year period. The number of shares, if any, that are ultimately awarded is contingent upon our total shareholder return versus selected peer group companies. The performance share payout is based on a market condition, and as such, the awards are valued using a Monte Carlo simulation model. The model generates the fair value of the award at the grant date, which is then recognized as expense on a straight-line basis over the vesting period. Additionally, we do not estimate a forfeiture rate for non-vested units. As such, unexpected forfeitures will lower stock-based compensation during the period in which they occur.
As of December 31, 2022, there was $5.0 million of unrecognized compensation cost related to our performance share unit awards, which is attributable to awards granted in 2020, 2021 and 2022. This cost is expected to be recognized over a weighted average period of 1.6 years.
A summary of our performance share units is presented below:
 202220212020
Common shares reserved for performance shares granted during year 193,333 191,203 361,870 
Weighted average fair value of performance share units granted$45.68 $36.10 $29.59 
Intrinsic value of outstanding performance share units (a)$13,123 $16,360 $11,711 
Fair value of performance shares vested5,549 1,738 3,522 
Cash used to purchase common shares from current and former employees to pay withholding tax requirements on performance shares vested2,454 559 992 
(a)Intrinsic value of outstanding performance share units is based on the market price of the Company's stock at December 31, 2022.
 2022
 Number
of Units		Weighted
Average Grant
Date Fair Value
Outstanding Performance Share units at January 1,405,361 $33.16 
Granted110,476 45.68 
Units Distributed(115,167)35.98 
Other Cancellations/Adjustments(2,514)39.23 
Outstanding Performance Share units at December 31,398,156 $35.78 
Expected volatility was estimated using daily returns on the Company’s common shares for the three-year period ending on the grant date. The risk-free rate was based on the 3-year U.S. Treasury rate on the date of the award. The dividend yield was not used to calculate fair value as awards granted receive dividend equivalents. Grants made to Vice Presidents and above are subject to a one-year post-vest holding period and include an additional discount for liquidity. The following table provides an overview of the assumptions used in calculating the fair value of the awards granted for the three years ended December 31:
 202220212020
Expected volatility38.1 %35.6 %32.6 %
Risk-free rate2.6 %0.4 %0.3 %
Liquidity discount applied to grants with a post-vesting holding restriction (a)4.2 %6.3 %n/a
 
(a)One-year post-vest holding requirement began in grant year 2021.
NON-QUALIFIED EMPLOYEE STOCK OPTIONS
The exercise price of each non-qualified stock option granted under the Stock Plan is equal to the closing market price of the Company’s stock on the grant date. Under the Stock Plan, the maximum term is 10 years from the grant date.
A summary of the status of our stock options as of and for the year ended December 31, 2022 is presented below:
 2022
 Number of
Shares		Weighted
Average Exercise
Price
(per common share)		Weighted
Average
Remaining
Contractual Term
(in years)		Aggregate
Intrinsic
Value
Options outstanding at January 1,124,170 $36.67 
Exercised(64,762)38.07 
Cancelled or expired(5,317)35.13 
Options outstanding at December 31,54,091 35.15 0.57$40 
Options exercisable at December 31,54,091 $35.15 0.57$40 
A summary of additional information pertaining to our stock options is presented below:
 202220212020
Intrinsic value of options exercised (a)$300 $916 $108 
Cash received from exercise of options2,466 5,922 1,368 
(a)Intrinsic value of options exercised is the amount by which the fair value of the stock on the exercise date exceeded the exercise price of the option.
As of December 31, 2022, compensation cost related to stock options was fully recognized.