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Stock and Other Incentive Plans
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Stock and Other Incentive Plans Stock and Other Incentive Plans
Stock Incentive Plan
The Legacy HR stockholders approved the Legacy HR Incentive Plan, which authorized the Company to issue 3,500,000 shares of common stock to its employees and directors. The Legacy HR Incentive Plan was replaced as of the merger date by the Incentive Plan. As of December 31, 2022 and 2021, the Company had issued a total of 3,417,696 and 2,386,822 restricted shares under the Incentive Plan and the Legacy HR Incentive Plan, respectively. Unvested awards under the Legacy HR Incentive Plan were assumed according to their existing terms by the Company in connection with the Merger. Non-vested shares issued under the Legacy HR Incentive Plan are generally subject to fixed vesting periods varying from three to eight years beginning on the date of issue. If a recipient voluntarily terminates his or her relationship with the Company or is terminated for cause before the end of the vesting period, the shares are forfeited, at no cost to the Company. Once the shares have been issued, the recipient has the right to receive dividends and the right to vote the shares through the vesting period. Compensation expense, included in general and administrative expense, recognized during the years ended December 31, 2022, 2021 and 2020 from the amortization of the value of shares over the vesting period issued to employees and directors was $13.9 million, $10.4 million and $9.7 million, respectively. The following table represents expected amortization of the Company's non-vested shares issued as of December 31, 2022:
Dollars in millionsFUTURE AMORTIZATION
of non-vested shares
2023$12.0 
202410.0 
20258.3 
20265.5 
20270.4 
2028 and thereafter0.1 
Total$36.3 

Executive Incentive Plan
The Compensation Committee has adopted an executive incentive plan pursuant to the Incentive Plan (the "Executive Incentive Plan") to provide specific award criteria with respect to incentive awards made under the Incentive Plan subject to the discretion of the Compensation Committee. Under the terms of the Executive Incentive Plan, the Company's named executive officers, and certain other members of senior management, may earn incentive awards in the form of cash, non-vested stock, restricted stock units ("RSUs"), and units in the OP ("OP Units"). For 2022, 2021 and 2020, compensation expense, included in general and administrative expense, resulting from the amortization of the Executive Incentive Plan non-vested share and RSU grants to officers was approximately $9.8 million, $6.6 million, and $5.9 million, respectively. Details of equity awards that have been issued under this plan are as follows:
•On January 3, 2022, the Company granted non-vested stock awards to its named executive officers, and certain other members of senior management and employees, with a grant date fair value of $7.9 million, which consisted of an aggregate of 249,689 non-vested shares with a five-year vesting period, which will result in an annual compensation expense of $1.6 million for each of 2023, 2024, 2025 and 2026.
•On January 3, 2022, the Company granted RSUs to its named executive officers, and certain other members of senior management and officers, with a grant date fair value of $9.7 million, which consisted of an aggregate
294,932 RSUs with a three-year performance period and a total five-year vesting period, which will result in an annual compensation expense of $1.9 million for each of 2023, 2024, 2025, and 2026.
•On February 22, 2022, the Company granted a performance-based award to its named executive officers, senior vice presidents, and first vice presidents with a grant date fair value of $3.9 million, which consisted of an aggregate of 126,930 non-vested shares with a five-year vesting period, which will result in an annual compensation expense of $0.8 million for 2023, 2024, 2025 and 2026, and $0.1 million for 2027.
•On December 12, 2022, the Company granted non-vested stock awards to its named executive officers in view of efforts with respect to the merger transaction and integration of the two companies, with a grant date fair value of $2.7 million, which consisted of an aggregate of 140,809 non-vested shares with a three-year vesting period, which will result in an compensation expense of $0.9 million for 2023, 2024 and 2025.
•On January 4, 2023, the Company granted non-vested stock awards to its named executive officers, senior vice presidents, and first vice presidents with a grant date fair value of $4.1 million, which consisted of an aggregate of 205,264 shares with a ratable five-year vesting period, which will result in an annual compensation expense of $0.8 million for 2023, 2024, 2025, 2026 and 2027.
•On January 4, 2023, the Company granted 627,547 in OP units to named executive officers with a three-year performance period and ratable vestings of 50% in year four and 50% in year five. The expense will be recognized on the straight-line basis over the five-year vesting period.
•On January 4, 2023, the Company granted RSUs to certain of its non-executive senior officers consisting of an aggregate of 165,174 RSUs with ratable vestings of 50% in year four and 50% in year five. The expense will be recognized on the straight-line basis over the five-year vesting period

Approximately 43% of the RSUs vest based on two market performance conditions. Relative and absolute total shareholder return ("TSR") awards containing these market performance conditions were valued using independent specialists. The Company utilized a Monte Carlo simulation to calculate the weighted average grant date fair values of $30.56 for the absolute TSR component and $41.30 for the relative TSR component for the January 2022 grant using the following assumptions:

Volatility30.0 %
Dividend AssumptionAccrued
Expected term in years3 years
Risk-free rate1.02 %
Stock price (per share)$31.68

The remaining 57% of the RSUs vest upon certain operating performance conditions. With respect to the operating performance conditions of the January grant, the grant date fair value was $31.68 based on the Company's share price on the date of grant. The combined weighted average grant date fair value of the January 2022 RSUs was $33.04 per share.
Long-Term Incentive Program
In the first quarter of 2022, the Company granted a performance-based award to certain non-executive officers under the Long-term Incentive Program adopted under the Legacy HR Incentive Plan (the "LTIP") totaling approximately $0.6 million, which was granted in the form of 19,204 non-vested shares. In the first quarter of 2021, the Company granted a performance-based award to certain non-executive officers under the LTIP totaling approximately $0.6 million, which was granted in the form of 19,679 non-vested shares. The shares have vesting periods ranging from one to eight years with a weighted average vesting period of approximately five years.
For 2022, 2021 and 2020, compensation expense resulting from the amortization of non-vested share grants to officers was approximately $0.9 million, $1.0 million, and $1.1 million, respectively.
Salary Deferral Plan
The Company's salary deferral plan allows certain of its officers to elect to defer up to 50% of their base salary in the form of non-vested shares subject to long-term vesting. The number of shares will be increased through a Company match depending on the length of the vesting period selected by the officer. The officer's vesting period choices are: three years for a 30% match; five years for a 50% match; and eight years for a 100% match. During 2022, 2021 and 2020, the Company issued 17,381 shares, 21,396 shares and 17,570 shares, respectively, to its officers through the salary deferral plan. For 2022, 2021 and 2020, compensation expense resulting from the amortization of non-vested share grants to officers was approximately $0.9 million for each year, respectively.
Non-employee Directors Incentive Plan
The Company issues non-vested shares to its non-employee directors under the Incentive Plan. The directors’ shares have a one-year vesting period and are subject to forfeiture prior to such date upon termination of the director’s service, at no cost to the Company. For each of the years 2022, 2021 and 2020, compensation expense resulting from the amortization of non-vested share grants to directors was approximately $1.5 million, $1.2 million, and $1.0 million, respectively.
•On May 13, 2022, the Company granted a non-vested stock award to eight of its directors, with a grant date fair value of $0.8 million, which consisted of an aggregate of 26,840 non-vested shares, with a one-year vesting period.
•On August 2, 2022, the Company granted non-vested stock awards to twelve of its directors, with a grant date fair value of $1.8 million, which consisted of an aggregate of 70,816 non-vested shares, with a vesting period between one and three years.
Other Grants
The Company issued three one-time non-vested share grants related to executive management transition in 2016. For 2022, 2021 and 2020, compensation expense resulting from the amortization of these non-vested share grants to officers was approximately $0.8 million, $0.7 million, and $0.8 million, respectively.
In 2022, the Company made discretionary awards of 5,806 shares of non-vested stock to three employees.
A summary of the activity under the Incentive Plans and related information for the three years in the period ended December 31, 2022 follows: 
YEAR ENDED DECEMBER 31,
Dollars in thousands, except per share data202220212020
Share-based awards, beginning of year1,562,028 1,766,061 1,754,066 
Granted657,475 203,701 197,999 
Vested(418,949)(404,777)(186,004)
Forfeited(5,426)(2,957)— 
Share-based awards, end of year1,795,128 1,562,028 1,766,061 
Weighted-average grant date fair value of
Share-based awards, beginning of year$31.10 $30.51 $29.82 
Share-based awards granted during the year$28.11 $30.86 $30.33 
Share-based awards vested during the year$31.52 $28.38 $23.82 
Stock-based awards forfeited during the year$31.48 $33.04 $— 
Share-based awards, end of year$29.91 $31.10 $30.51 
Grant date fair value of shares granted during the year$18,480 $6,286 $6,006 
The vesting periods for the non-vested shares granted during 2022 ranged from one to eight years with a weighted-average amortization period remaining as of December 31, 2022 of approximately 4.3 years.
During 2022, 2021 and 2020, the Company withheld 137,892 shares, 129,987 shares and 54,223 shares, respectively, of common stock from its officers to pay estimated withholding taxes related to the vesting of shares.
401(k) Plan
The Company maintains a 401(k) plan that allows eligible employees to defer salary, subject to certain limitations imposed by the Internal Revenue Code. The Company provides a matching contribution of up to 3% of each eligible employee’s salary, subject to certain limitations. The Company’s matching contributions were approximately $1.2 million for the year ended December 31, 2022, $0.7 million for 2021 and $0.6 million for 2020.
Employee Stock Purchase Plan
The outstanding options relate only to the Legacy HR Employee Stock Purchase Plan, which was terminated in November 2022. No new options will be issued under the Legacy HR Employee Stock Purchase Plan and existing options will expire in March 2024.
During the years ended December 31, 2022, 2021 and 2020, the Company recognized in general and administrative expenses approximately $0.4 million, $0.4 million, and $0.3 million, respectively, of compensation expense related to the annual grant of options to its employees to purchase shares under the Legacy HR Employee Stock Purchase Plan.
Cash received from employees upon exercising options under the Legacy HR Employee Stock Purchase Plan was approximately $0.4 million for the year ended December 31, 2022, $0.8 million for the year ended December 31, 2021, and $0.7 million for the year ended December 31, 2020.
A summary of the Legacy HR Employee Stock Purchase Plan activity and related information for the three years in the period ended December 31, 2022 is as follows:
YEAR ENDED DECEMBER 31,
Dollars in thousands, except per share data202220212020
Options outstanding, beginning of year348,514 341,647 332,659 
Granted255,960 253,200 212,716 
Exercised(20,246)(30,281)(21,713)
Forfeited(102,619)(71,630)(42,221)
Expired(140,633)(144,422)(139,794)
Options outstanding and exercisable, end of year340,976 348,514 341,647 
Weighted-average exercise price of
Options outstanding, beginning of year$25.38 $24.70 $25.59 
Options granted during the year$26.89 $25.16 $28.36 
Options exercised during the year$20.97 $25.03 $24.10 
Options forfeited during the year$21.88 $25.45 $25.29 
Options expired during the year$23.36 $24.17 $23.74 
Options outstanding, end of year$16.38 $25.38 $24.70 
Weighted-average fair value of options granted during the year (calculated as of the grant date)$9.91 $9.05 $8.06 
Intrinsic value of options exercised during the year$75 $165 $101 
Intrinsic value of options outstanding and exercisable
(calculated as of December 31)
$985 $1,997 $1,673 
Exercise prices of options outstanding
(calculated as of December 31)
$16.38 $25.91 $24.70 
Weighted-average contractual life of outstanding options (calculated as of December 31, in years)0.80.80.8
The fair values for these options were estimated at the date of grant using a Black-Scholes options pricing model with the weighted-average assumptions for the options granted during the period noted in the following table. The risk-free interest rate was based on the U.S. Treasury constant maturity-nominal two-year rate whose maturity is nearest to the date of the expiration of the latest option outstanding and exercisable; the expected dividend yield was based on the expected dividends of the current year as a percentage of the average stock price of the prior year; the expected life of each option was estimated using the historical exercise behavior of employees; expected volatility was based on
historical volatility of the Company’s common stock; and expected forfeitures were based on historical forfeiture rates within the look-back period. 
202220212020
Risk-free interest rates0.73 %0.13 %1.58 %
Expected dividend yields3.97 %4.11 %3.69 %
Expected life (in years)1.441.431.43
Expected volatility49.0 %48.2 %28.6 %
Expected forfeiture rates85 %85 %85 %