Shareholders' Equity

12 Months Ended

Dec. 31, 2022

Stockholders' Equity Note [Abstract]

Shareholders' Equity

Shareholders' EquityWe have common shares available for issuance under the terms of our equity compensation plan adopted in 2012, as amended, or the 2012 Plan. During the years ended December 31, 2022, 2021 and 2020, we awarded to our officers and other employees of The RMR Group LLC, or RMR, annual share awards of 707,000, 718,000 and 360,000 of our common shares, respectively, valued at $919, $2,448 and $1,357, in aggregate, respectively. In accordance with our Trustee compensation arrangements, we also awarded each of our then Trustees 20,000 common shares with an aggregate value of $300 ($43 per Trustee), 20,000 common shares with an aggregate value of $444 ($74 per Trustee) and 10,000 common shares with an aggregate value of $176 ($29 per Trustee) in 2022, 2021 and 2020, respectively. The values of the share awards were based

upon the closing price of our common shares trading on The Nasdaq Stock Market LLC, or Nasdaq, on the dates of awards. The common shares awarded to our Trustees vested immediately. The common shares awarded to our officers and certain other employees of RMR (in those capacities) vest in five equal annual installments beginning on the date of award. We include the value of awarded shares in general and administrative expenses in our consolidated statements of comprehensive income (loss) ratably over the vesting period. At December 31, 2022, 2,667,253 of our common shares remain available for issuance under the 2012 Plan.

A summary of shares awarded, forfeited, vested and unvested under the terms of the 2012 Plan from January 1, 2020 to December 31, 2022 is as follows:

	Number of Shares	Weighted Average Award Date Fair Value
Unvested shares at December 31, 2019	227,340	$	12.52
Shares awarded in 2020	420,000	$	3.65
Shares vested / forfeited in 2020	(212,790)	$	7.04
Unvested shares at December 31, 2020	434,550	$	6.15
Shares awarded in 2021	838,000	$	3.45
Shares vested / forfeited in 2021	(426,930)	$	4.98
Unvested shares at December 31, 2021	845,620	$	4.07
Shares awarded in 2022	847,000	$	1.44
Shares vested / forfeited in 2022	(576,620)	$	3.24
Unvested shares at December 31, 2022	1,116,000	$	2.50

The 1,116,000 unvested shares as of December 31, 2022 are scheduled to vest as follows: 374,800 shares in 2023, 329,400 shares in 2024, 270,400 shares in 2025 and 141,400 shares in 2026. As of December 31, 2022, the estimated future compensation for the unvested shares was $2,424 based on the adjusted award date fair value of these shares. At December 31, 2022, the weighted average period over which the compensation expense will be recorded is approximately 1.9 years. We recorded share based compensation expense of $1,733 in 2022, $1,960 in 2021 and $1,568 in 2020. We recognize forfeitures as they occur.

During 2022, 2021 and 2020, we purchased an aggregate of 133,752, 109,384 and 47,375, respectively, of our common shares from certain of our Trustees and officers and certain other current and former officers and employees of RMR in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. See Note 8 for further information regarding these purchases.

A summary of cash distributions paid to common shareholders, for federal income tax purposes, as are follows for the periods presented:

	Annual Per				Characterization of Distribution
	Share		Total		Ordinary		Capital		Return of
Year	Distribution		Distribution		Income		Gain		Capital
2022	$	0.04	$	9,568	—	%	14.0	%	86.0	%
2021	$	0.04	$	9,540	—	%	100.0	%	—	%
2020	$	0.18	$	42,825	—	%	—	%	100.0	%

On January 12, 2023, we declared a quarterly distribution to common shareholders of record on January 23, 2023 of $0.01 per share, or approximately $2,397 in aggregate. We paid this distribution on February 16, 2023, using cash on hand.

As described in Note 6, pursuant to the 2020 Restructuring Transaction, on January 1, 2020, AlerisLife issued an aggregate of 16,118,849 common shares, with an aggregate value of $59,801, to our shareholders of record as of December 13, 2019. We recorded this issuance as a non-cash distribution in our consolidated financial statements.