EPR PROPERTIESEPR
EPR PROPERTIES Stock Compensation Disclosure
Equity Incentive Plans
The Company issues equity awards under the 2016 Equity Incentive Plan, which may be in the form of restricted common shares, restricted share units, performance share units or other share-based awards. On May 6, 2025, the Company amended the 2016 Equity Incentive Plan by shareholder vote to increase the maximum number of authorized shares issuable under the plan from 3,950,000 to 5,950,000 shares. Additionally, the 2020 Long Term Incentive Plan (2020 LTIP) is a sub-plan under the Company's 2016 Equity Incentive Plan. Under the 2020 LTIP, the Company awards performance share units and restricted shares to the Company's executive officers. At December 31, 2025, there were 2,295,262 shares available for grant under the 2016 Equity Incentive Plan.
Nonvested Shares
A summary of the Company’s nonvested share activity and related information is as follows:
| Number of shares | Weighted avg. grant date fair value | Weighted avg. life remaining | |||||||||||||||
Outstanding at December 31, 2024 | 614,614 | $ | 42.79 | ||||||||||||||
| Granted | 301,096 | 50.38 | |||||||||||||||
| Vested | (266,832) | 43.43 | |||||||||||||||
Outstanding at December 31, 2025 | 648,878 | $ | 46.05 | 0.77 | |||||||||||||
The holders of nonvested shares have voting rights and receive dividends from the date of grant. The fair value of the nonvested shares that vested was $11.8 million, $13.7 million, and $8.7 million for the years ended December 31, 2025, 2024 and 2023, respectively. Expense recognized related to nonvested shares and included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income was $7.8 million, $6.9 million and $7.6 million for the years ended December 31, 2025, 2024 and 2023, respectively. Expense related to nonvested shares and included in "Retirement and severance expense" in the accompanying consolidated statements of income and comprehensive income was $1.0 million, $0.7 million and $0.4 million for the years ended December 31, 2025, 2024 and 2023, respectively. At December 31, 2025, unamortized share-based compensation expense related to nonvested shares was $11.0 million and will be recognized in future periods as follows (in thousands):
| Amount | |||||
| Year: | |||||
| 2026 | $ | 5,701 | |||
| 2027 | 3,713 | ||||
| 2028 | 1,586 | ||||
| Total | $ | 11,000 | |||
Nonvested Performance Share Units
A summary of the Company's nonvested performance share unit activity and related information is as follows:
| Target Number of Performance Share Units | Weighted avg. grant date fair value (1) | Weighted avg. life remaining | |||||||||||||||
Outstanding at December 31, 2024 | 326,469 | $ | 59.44 | ||||||||||||||
| Granted | 113,833 | 66.45 | |||||||||||||||
| Vested (2) | (98,610) | 72.63 | |||||||||||||||
Outstanding at December 31, 2025 | 341,692 | $ | 57.97 | 1.00 | |||||||||||||
(1) The grant date fair value was determined utilizing (i) a Monte Carlo simulation model to generate an estimate of the Company's future share price over the three-year performance period for performance share units based on the Company's Total Shareholder Return (TSR) performance further described below and (ii) the Company's grant date fair value for performance share units based on the Company's Compounded Annual Growth Rate (CAGR) in AFFO per share over the three-year performance period.
(2) The achievement of the performance conditions for the performance share units granted during the year ended December 31, 2022 resulted in a performance payout percentage of 200% for both the Company's TSR relative to the TSRs of the Company's peer group companies and the Company's TSR relative to the TSRs of companies in the MSCI US REIT Index, and a payout percentage of 200% for the Company's CAGR in AFFO per share over the three-year performance period. The achievement of the performance conditions and the above payout percentages resulted in the issuance of 197,220 common shares and 51,612 common shares from dividend equivalents. The fair value of the performance share units and dividend equivalents that vested was $12.3 million.
The number of common shares issuable upon settlement of the performance share units granted during the years ended December 31, 2025, 2024 and 2023 will be based upon the Company's achievement level relative to the following performance measures over a three-year performance period ending December 31, 2027, 2026 and 2025, respectively. The Company's achievement level relative to the performance measures is assigned a specific payout percentage which is multiplied by the target number of performance share units.
| Granted during the years ended December 31, | TSR vs. Triple-Net Peer Group | TSR vs. MSCI US REIT Index | CAGR in AFFO per share growth | ||||||||
| 2023 | 50.0 | % | 25.0 | % | 25.0 | % | |||||
| 2024 | 52.2 | % | 26.1 | % | 21.7 | % | |||||
| 2025 | 52.2 | % | 26.1 | % | 21.7 | % | |||||
The performance share units based on relative TSR performance have market conditions and are valued using a Monte Carlo simulation model on the grant date, which resulted in a grant date fair value of approximately $6.3 million, $4.1 million and $5.9 million for the years ended December 31, 2025, 2024 and 2023, respectively. The estimated fair value is amortized to expense over the three-year vesting period, which ends on December 31, 2027, 2026 and 2025 for performance share units granted in 2025, 2024 and 2023, respectively. The following assumptions were used in the Monte Carlo simulation for computing the grant date fair value of the performance share units with a market condition for the years ended December 31, 2025, 2024 and 2023, respectively: risk-free interest rate of 4.2%, 4.5% and 4.4%, volatility factors in the expected market price of the Company's common shares of 25%, 30% and 52% and an expected life of approximately three years.
The performance share units based on growth in AFFO per share have a performance condition. The probability of achieving the performance condition is assessed at each reporting period. If it is deemed probable that the performance condition will be met, compensation cost will be recognized based on the closing price per share of the Company's common shares on the date of the grant multiplied by the number of awards expected to be earned. If it is deemed that it is not probable that the performance condition will be met, the Company will discontinue the recognition of compensation cost and any compensation cost previously recorded will be reversed. At December 31, 2025, achievement of the performance condition was deemed probable for the performance share units granted during the year ended December 31, 2025 with an expected payout percentage of 157%, which resulted in a grant date fair value of approximately $1.9 million. Achievement of the performance condition for the performance share units granted during the years ended December 31, 2024 and 2023 was deemed not probable at December 31, 2025.
Expense recognized related to performance share units and included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income was $5.3 million, $5.4 million and $7.9 million for the years ended December 31, 2025, 2024 and 2023, respectively. Expense related to performance share units and included in "Retirement and severance expense" in the accompanying consolidated statements of income and comprehensive income was $1.2 million and $0.9 million for the years ended December 31, 2025 and 2024, respectively.
At December 31, 2025, unamortized share-based compensation expense related to nonvested performance share units was $6.1 million and will be recognized in future periods as follows (in thousands):
| Amount | |||||
| Year: | |||||
| 2026 | $ | 3,832 | |||
| 2027 | 2,304 | ||||
| Total | $ | 6,136 | |||
Restricted Share Units
A summary of the Company’s restricted share unit activity and related information is as follows:
| Number of Shares | Weighted Average Grant Date Fair Value | Weighted Average Life Remaining | |||||||||||||||
Outstanding at December 31, 2024 | 45,410 | $ | 40.69 | ||||||||||||||
| Granted | 43,635 | 55.71 | |||||||||||||||
| Vested | (46,974) | 40.92 | |||||||||||||||
Outstanding at December 31, 2025 | 42,071 | $ | 56.01 | 0.42 | |||||||||||||
The holders of restricted share units receive dividend equivalents from the date of grant. Total expense recognized related to shares issued to non-associate Trustees and included in "General and administrative expense" in the accompanying consolidated statements of income and comprehensive income was $2.2 million, $1.8 million and $1.9 million for the years ended December 31, 2025, 2024 and 2023, respectively. At December 31, 2025, unamortized share-based compensation expense related to restricted share units was $982 thousand, which will be recognized in 2026.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 23, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 25, 2020 | |
| 2018 | Feb 28, 2019 | |
| 2017 | Mar 1, 2018 | |
| 2016 | Mar 1, 2017 | |
| 2015 | Feb 25, 2016 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.