Non-controlling Interests. We have entered into partnerships to develop and/or own real estate. Given that our limited members do not have the substantive kick-out rights, liquidation rights, or participation rights, we have concluded that the partnerships are VIEs. As we exercise power over and receive benefits from the VIEs, we are considered the primary beneficiary. Accordingly, we consolidate the VIEs and record the non-controlling interests on the consolidated financial statements. As of December 31, 2022, we have the following consolidated VIEs (in thousands):

(1)

Subsequent to December 31, 2022, we entered into a $121,321 JV with an affiliate of an existing operator and contributed $117,900 into the JV that purchased 11 ALF and MC from an affiliate of our JV partner. The JV leased the communities back to an affiliate of the seller under a 10-year master lease, with two five-year renewal options. The contractual initial cash yield of 7.25% increases to 7.5% in year three then escalates thereafter based on CPI subject to a floor of 2.0% and a ceiling of 4.0%. Additionally, the JV provided the seller-lessee with a purchase option to buy up to 50% of the properties at the beginning of the third lease year and the remaining properties at the beginning of the fourth lease year through the end of the sixth lease year, with an exit IRR of 9.0%. In accordance with GAAP, the communities acquired by the JV are required to be presented as a Financing receivable on our Consolidated Balance Sheets. See Note 2. Summary of Significant Accounting Policies and Note 5. Real Estate Investments for more information.

(2)

During 2022, we entered into a joint venture and contributed $61,661 into the JV that purchased three SNFs located in Florida for $75,825. Our JV partner contributed the remaining $14,325 of equity. The JV leased the centers back to an affiliate of the seller under a 10-year master lease, with two five-year renewal options and provided the seller-lessee with a purchase option, exercisable at the beginning of the fourth year through the end of the fifth year. In accordance with GAAP, the centers acquired by the JV are required to be presented as a Financing receivable on our Consolidated Balance Sheets. See Note 2. Summary of Significant Accounting Policies and Note 5. Real Estate Investments for more information.

Common Stock. We have separate equity distribution agreements (collectively, “Equity Distribution Agreements”) to offer and sell, from time to time, up to $200,000,000 in aggregate offering price of shares of our common shares. The Equity Distribution Agreements provide for sales of common shares to be made by means of ordinary brokers’ transactions, which may include block trades, or transactions that are deemed to be “at the market” offerings. During the years ended December 31, 2021 and 2020, no shares were issued under the Equity Distribution Agreements. During the year ended December 31, 2022, we sold 1,792,400 shares of common stock for $68,156,000 in net proceeds under our Equity Distribution Agreements. In conjunction with the sale of common stock, we incurred $513,000 of costs associated with this agreement which have been recorded in additional paid in capital as a reduction of proceeds received. At December 31, 2022, we had $130,631,000 available under the Equity Distribution Agreements.

During the years 2022, 2021 and 2020, we acquired 39,463 shares, 87,249 shares and 76,574 shares, respectively, of common stock held by employees who tendered owned shares to satisfy tax withholding obligations.

Stock Repurchase Plan. In March 2020, our Board of Directors authorized the repurchase of up to 5,000,000 outstanding shares of common stock. Due to the rising level of uncertainty in financial markets and the adverse effects of COVID-19 on the public health and our operators, our Board of Directors terminated the stock repurchase plan on March 25, 2020. During the year ended December 31, 2020, we purchased 615,827 shares at an average price of $29.25 per share, including commissions, for a total purchase price of $18,012,000.

Shelf Registration Statement. We have an automatic shelf registration statement on file with the SEC, and currently have the ability to file additional automatic shelf registration statements, to provide us with capacity to publicly offer an indeterminate amount of common stock, preferred stock, warrants, debt, depositary shares, or units. We may from time to time publicly raise capital under our automatic shelf registration statement in amounts, at prices, and on

terms to be announced when and if the securities are offered. The specifics of any future offerings, along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of the offering. Our shelf registration statement expires on February 17, 2025.

Distributions. We declared and paid the following cash dividends (in thousands):


	Year Ended December 31,
	2022				2021						2020
	Declared		Paid		Declared			Paid			Declared			Paid
Common Stock ⁽¹⁾	$	91,509	$	91,509	$	90,494	⁽²⁾	$	90,494	⁽²⁾	$	90,262	⁽²⁾	$	90,262	⁽²⁾

(1)	Represents $0.19 per share per month for the years ended December 31, 2022, 2021 and 2020.

(2)	During the years ended December 31, 2021 and 2020, we paid $764 and $586, respectively as a result of vesting of the performance-based stock units.

In January 2023, we declared a monthly cash dividend of $0.19 per share on our common stock for the months of January, February and March 2023 payable on January 31, February 28, and March 31, 2023, respectively, to stockholders of record on January 23, February 17, and March 23, 2023, respectively.

Stock Based Compensation Plans. During 2021, we adopted, and our stockholders approved the 2021 Equity Participation Plan (the “2021 Plan”) which replaces the 2015 Equity Participation Plan (the “2015 Plan”). Under the 2021 Plan, 1,900,000 shares of common stock have been authorized and reserved for awards, less one share for every one share that was subject to an award granted under the 2015 plan after December 31, 2020 and prior to adoption. In addition, any shares that are not issued under outstanding awards under the 2015 Plan because the shares were forfeited or cancelled after December 31, 2020 will be added to and again be available for awards under the 2021 Plan. Under the 2021 Plan, the shares were authorized and reserved for awards to officers, employees, non-employee directors and consultants. The terms of the awards granted under the 2021 Plan and the 2015 Plan are set by our compensation committee at its discretion. As of December 31, 2022, we have 1,545,722 shares of common stock reserved for awards under the 2021 Plan.

Restricted Stock and Performance-Based Stock Units. Restricted stock activity for the years ended December 31, 2022, 2021 and 2020 was as follows:


	Year Ended December 31,
	2022		2021		2020
Outstanding, January 1		197,422		180,440		163,569
Granted		135,210		110,348		101,348
Vested		(103,396)		(93,366)		(84,477)
Outstanding, December 31		229,236		197,422		180,440

During the years ended December 31, 2022, 2021 and 2020, we granted 86,332, 71,892 and 66,027, respectively, of performance-based stock units. Additionally, no performance-based stock units vested during the twelve months ended December 31, 2022. During the years ended December 31, 2021 and 2020, the number of vested performance-based stock units were 108,720 and 81,574, respectively. Total compensation expense related to restricted stock and performance-based stock units for the years ended December 31, 2022, 2021 and 2020 were $7,964,000, $7,760,000 and $7,012,000.

During 2022, 2021 and 2020, we granted 221,542, 182,240 and 167,375 shares of restricted common stock and performance-based stock units, respectively, under the 2021 Plan and 2015 Plan as follows:


	No. of	Price per
Year	Shares/Units	Share		Reward Type	Vesting Period
2022	122,865	$	33.94	Restricted stock	ratably over 3 years
	86,332	$	33.94	Performance-based stock units	TSR targets ⁽¹⁾
	12,345	$	38.48	Restricted stock	May 25,2023
	221,542

2021	95,293	$	42.27	Restricted stock	ratably over 3 years
	71,892	$	42.27	Performance-based stock units	TSR targets ⁽¹⁾
	12,055	$	39.40	Restricted stock	May 26, 2022
	3,000	$	43.14	Restricted stock	April 1, 2022
	182,240

2020	76,464	$	48.95	Restricted stock	ratably over 3 years
	66,027	$	49.98	Performance-based stock units	TSR targets ⁽¹⁾
	9,884	$	38.45	Restricted stock	May 27, 2021
	15,000	$	38.45	Restricted stock	ratably over 3 years
	167,375

(1)	Vesting is based on achieving certain total shareholder return (“TSR”) targets in 4 years with acceleration opportunity in 3 years.

At December 31, 2022, the remaining compensation expense to be recognized related to the future service period of unvested outstanding restricted common stock and performance-based stock units are as follows (dollar amount in thousands):


	Remaining
	Compensation
Vesting Date	Expense
2023	$	5,603
2024		2,853
2025		309
Total	$	8,765

Stock Options. During 2022, 2021 and 2020, we did not issue any stock options. Nonqualified stock option activity for the years ended December 31, 2022, 2021 and 2020, was as follows:


				Weighted Average
	Shares			Price
	2022	2021	2020	2022			2021	2020
Outstanding, January 1	15,000	15,000	15,000	$	38.43	$	38.43	$	38.43
Granted	—	—	—		n/a		n/a		n/a
Exercised	—	—	—		n/a		n/a		n/a
Canceled	(5,000)	—	—	$	38.43		n/a		n/a
Outstanding, December 31	10,000	15,000	15,000	$	38.43	$	38.43	$	38.43

Exercisable, December 31⁽¹⁾	10,000	15,000	15,000	$	38.43	$	38.43	$	38.43

(1)

The aggregate intrinsic value of exercisable options at December 31, 2022, based upon the closing price of our common shares at December 30, 2022, the last trading day of 2022, was approximately $0. Options exercisable at December 31, 2022, 2021 and 2020 have a weighted average remaining contractual life of approximately 0.7 years, 1.2 years, and 2.2 years, respectively.

We use the Black-Scholes-Merton formula to estimate the value of stock options granted to employees. This model requires management to make certain estimates including stock volatility, expected dividend yield and the expected term. Compensation expense related to the vesting of stock options for the years ended December 31, 2022, 2021 and 2020 was $0.