CareTrust REIT Inc

2024 Base Salaries

We pay each named executive officer a fixed base salary to provide each executive with a minimum level of cash compensation. One aspect of our executive compensation philosophy is to pay a base salary level that, when combined with the annual performance-based cash bonus opportunity and the target value of annual long-term equity awards, results in more than two-thirds of the named executive officers’ total annual compensation opportunity being at risk and tied to performance metrics and/or the price of our Common Stock.

Decisions regarding adjustments to base salaries are made at the discretion of our compensation committee, after considering each executive’s current base salary, job responsibilities, performance, the base salaries paid by our Peer Group companies to similarly situated executives, base salary information from the 2023 Nareit Compensation Survey for similarly situated executives at healthcare REITs, and our base salary compensation philosophy described above. No named executive officers are entitled to any automatic base salary increases.

The compensation committee reviewed each named executive officer’s base salary in December 2023 and approved the following increases to their annual base salary for 2024: Mr. Sedgwick’s base salary was increased from $800,000 to $880,000; Mr. Wagner’s base salary was increased from $555,660 to $575,108; and Mr. Callister’s base salary was increased from $500,000 to $529,500. The compensation committee determined the base salary increases for each named executive officer were appropriate to adjust for approximate cost of living increases. In addition, for Messrs. Sedgwick and Callister, the base salary increases reflected additional slight increases to adjust the base salary levels closer to peer comparison levels for similarly situated executives following their recent promotions to President and Chief Executive Officer and Chief Investment Officer, respectively.

2024 Annual Cash Incentive Awards

In General. We provide our named executive officers with a performance-based annual cash incentive compensation opportunity to motivate and reward the executives for their achievement of annual financial and operational goals and other strategic objectives measured over the year. We believe the annual cash incentive opportunity helps further our compensation objective of aligning executive compensation with achievement of the Company’s corporate strategies, business objectives and the creation of long-term value for our stockholders.

Design. Pursuant to the annual cash incentive program, the compensation committee approved a predetermined target bonus amount for each named executive officer, with the actual bonus to be payable to each executive officer to be between 0% and a maximum level set at 275% for our Chief Executive Officer and 250% for our other executive officers for 2024, as explained below, based on the achievement of pre-established threshold, target and higher performance level performance metrics for the year. We believe that having a predetermined target bonus amount, coupled with upside and downside leverage, is more consistent with the practices of our Peer Group based on Pearl Meyer’s study. As further described below, for 2024 the compensation committee retained the key incentive metrics used for annual cash incentive opportunities in prior years. The compensation committee believes that these incentive metrics have served to effectively incentivize our named executive officers’ performance. The compensation committee also determined to continue use of a separate ESG Incentives metric for our President and Chief Executive Officer.

Incentive Targets. For 2024, the compensation committee established the following annual cash incentive bonus targets for each named executive officer.

The compensation committee determined it was appropriate to increase the annual cash incentive bonus target for each executive officer for 2024 compared to 2023 to adjust for approximate cost of living increases. The compensation committee also approved an additional increase to the annual cash incentive bonus target for Mr. Callister to adjust his total target cash compensation level closer to peer companies for similarly situated executives and to align it with Mr. Wagner to more closely align the executive team. For Mr. Sedgwick, the annual cash incentive bonus target for 2024 decreased slightly as a percentage of base salary compared to 2023 as the compensation committee primarily targeted Mr. Sedgwick’s base salary and the long-term incentive components of Mr. Sedgwick’s total direct compensation to continue to adjust Mr. Sedgwick’s total direct compensation to compensation levels more closely aligned with similarly situated executives.

Incentive Metrics. Under our annual cash incentive plan design for 2024, the compensation committee selected the following performance measures to evaluate executive incentive performance:

•NFFO per share for 2024;

•capital deployment;

•average net debt to normalized run rate EBITDA calculated at each quarter end during 2024; and

•for our President and Chief Executive Officer, certain ESG Incentives as further described below.

FFO, as defined by the National Association of Real Estate Investment Trusts (“Nareit”), is an important supplemental measure not computed in accordance with GAAP and measures operating performance for a REIT. FFO is defined by Nareit as net income computed in accordance with GAAP, excluding gains or losses from real estate dispositions, real estate depreciation and amortization and real estate impairment charges, adjustments for the share of consolidated joint ventures, and adjustments for unconsolidated partnerships and joint ventures. Noncontrolling interests’ pro rata share information is prepared by applying noncontrolling interests’ actual ownership percentage for the period and is intended to reflect noncontrolling interests’ proportionate economic interest in the financial position and operating results of properties in our portfolio. We compute FFO in accordance with Nareit’s definition. NFFO adjusts FFO for certain revenue and expense items that we do not believe are indicative of our ongoing operating results, such as write-off of deferred financing costs, provision for loan losses, non-routine transaction costs, provision for doubtful accounts and lease restructuring, loss on extinguishment of debt, extraordinary incentive plan payment, recovery of previously reversed rent, lease termination revenue, unrealized (gain) loss on other real estate related investments and property operating expenses. Normalized EBITDA represents net income before interest expense (including amortization of deferred financing costs) and amortization of stock-based compensation, and depreciation and amortization, adjusted for certain income and expense items we do not believe are indicative of our ongoing operating results, such as write-off of deferred financing costs, real estate impairment charges, provision for loan losses, provision for doubtful accounts and lease restructuring, recovery of previously reversed rent, lease termination revenue, property operating expenses, non-routine transaction costs, loss on extinguishment of debt, extraordinary incentive plan payment, unrealized loss on other real estate related investments and gains or losses from dispositions of real estate or other real estate. These performance measures are non-GAAP financial measures for which net income is the most directly comparable financial measure reported under GAAP.

The compensation committee chose NFFO per share as a performance metric because the committee believes it is a common performance metric used by investors to evaluate the performance of REITs, and the committee believes that motivating the executives to drive growth in our NFFO per share performance will in turn benefit stockholders in the form of increased stockholder returns. For 2024, the compensation committee determined the following threshold, target and high performance levels for our NFFO per share: NFFO per share of $1.4116 to earn the threshold bonus amount, $1.4421 to earn the target bonus amount, and $1.4734 to earn the high bonus amount payable with respect to this performance measure.

The compensation committee chose our capital deployment and our 2024 average quarterly net debt to normalized run rate EBITDA ratio as performance metrics because it wanted to motivate the executives to grow our portfolio and pursue new tenant relationships with quality operators to further diversify our revenue stream, while at the same time motivating the executives to responsibly manage our leverage ratios and our overall capital structure.

For 2024, the compensation committee required capital deployment of $200 million to earn the threshold bonus amount, $300 million to earn the target bonus amount, and $400 million to earn the high bonus amount payable with respect to this performance measure. These performance goals reflected a doubling of the similar performance levels used for the 2023 cash incentive plan in recognition of an expected improved operating environment for 2024 investments following the substantial year over year increase in capital deployment from 2022 to 2023. Based on optimism about potential investment opportunities for 2024 but reflecting the significant uncertainties that existed with respect to the Company’s ability to complete projected investments, the compensation committee also approved both a super high and an extraordinary performance measure for the capital deployment objective, which required capital deployment of $750 million to earn the super high bonus amount and $1.5 billion to earn the extraordinary bonus amount payable with respect to this performance measure. While the compensation committee had set a super high performance level for capital deployment in each of the past four years, the compensation committee recognized that also setting an additional extraordinary performance level was more unusual. The committee determined it was appropriate to establish performance metrics at both levels for 2024 to incentivize the executive team to remain focused on continued growth while recognizing the extraordinary achievement that would be required to accomplish the level of investments necessary to achieve the extraordinary capital deployment goal.

With respect to our leverage levels, the compensation committee required a 2024 average quarterly ratio of net debt to normalized run rate EBITDA to be 3.50x to earn the threshold bonus amount, 3.00x to earn the target bonus amount, and 2.50x to earn the high bonus amount payable with respect to this performance measure. The net debt-to-normalized EBITDA ratio targets were set lower than 2023 levels given where the Company’s net debt to normalized EBITDA ended at December 31, 2023. As noted above, we believe these capital deployment and ratio of net debt to normalized EBITDA targets operated in tandem to motivate the executives to grow and diversify our portfolio while at the same time motivating them to responsibly manage our capital structure and use of leverage.

The following table illustrates the performance metrics set forth above for the named executive officers at the threshold, target, high, super high and extraordinary bonus levels.

In addition to the performance metrics above, the compensation committee decided to continue the ESG Incentives for our President and Chief Executive Officer to reinforce the Company’s commitment to achieving its ESG targets. The ESG Incentives that our President and Chief Executive Officer was required to achieve to receive the ESG Incentives amount at either a threshold, target or high level were as follows for 2024:

•ESG Incentives Threshold: Communicate identified properties with higher climate risk to tenants, ensure tenants leasing properties with higher physical risk have resiliency plans in place.

•ESG Incentives Target: Meet threshold requirement above plus analyze energy, water, and waste data to identify opportunities to reduce consumption through environmental improvement projects.

•ESG Incentives High: Meet target requirement above plus utilize the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations to disclose climate-related risks and opportunities through our Corporate Sustainability Report and prepare for the SEC’s climate-related disclosures.

The following table illustrates the weighting of each performance measure for each named executive officer at the threshold, target, high, super high and extraordinary bonus levels.

Performance Measure Weighting

For 2024, based on feedback from Pearl Meyer, the compensation committee approved increases in the weightings for the performance goals under the annual cash incentive program compared to the weightings applied in prior years to bring the maximum payout levels under the cash incentive program closer in line to the practices of our Peer Group. For Messrs. Wagner and Callister, the compensation committee established a 200% weighting for super high performance and a 250% weighting for extraordinary performance. With reference to performance weightings established by certain of our Peer Group companies, the compensation

committee set slightly higher weighting levels for Mr. Sedgwick compared to our other executive officers, with a 200% level established for high performance and up to a 275% weighting for extraordinary performance, to allow him the potential to achieve total direct compensation that would more closely approximate the total target direct compensation percentile level of our other executive officers compared to similarly situated executives.

The actual annual cash incentive earned by each named executive officer is determined by the sum of the percentage values for each metric at the level achieved for that metric multiplied by each executive’s target bonus amount. If the actual performance level achieved for any metric falls below the threshold level, no percentage is awarded for that metric. If the actual performance is above the high level, high level is awarded for that metric (except for capital deployment, where super high is awarded for performance above the super high level and extraordinary is awarded for performance above the extraordinary level). If actual performance is in between, the percentage for each metric is calculated using straight line linear interpolation.

On January 28, 2025, the compensation committee assessed performance based on actual results achieved for 2024. The compensation committee determined that the Company achieved: a 2024 NFFO per share amount that exceeded the high performance level, with actual NFFO per share of $1.4993 for 2024; 2024 capital deployment that exceeded the extraordinary performance level, with actual deployment totaling $1,528.6 million for 2024; and a 2024 average quarterly net debt to normalized run rate EBITDA ratio that exceeded the high performance level, with an actual net debt to normalized run rate EBITDA of 0.40x for 2024. The Company’s achievement with respect to each of these performance measures for 2024 NFFO, capital deployment level and leverage level reflected record performance for the Company. In addition, based on the Company’s accomplishments with respect to the sustainability initiatives required by the ESG Incentives described above, the SCR committee determined that each of the ESG Initiatives were met and the compensation committee determined that this performance metric was met at the high performance level with respect to the annual cash incentive award for our President and Chief Executive Officer.

The following table illustrates the percentage value actually achieved for each performance metric based on our 2024 performance.

The following table illustrates the actual 2024 cash incentive awards approved by the compensation committee:

Long-Term Equity Incentive Awards Granted in 2024

In General. The compensation committee believes that stock-based incentives align the interests of our named executive officers with the interests of our stockholders, and that the long-term compensation of the named executive officers should be linked to the value provided to our stockholders. Our stock-based incentives are structured in the form of full value stock awards payable in shares of our Common Stock that may increase or decrease in value over the multi-year vesting period. Our stock awards are designed to reward long-term performance and generally consist of an equal number of time- and performance-based vesting awards. We also use stock-based compensation as a retention tool. Because the stock awards generally vest over a multi-year period subject to continued employment with the Company (and subject to the achievement of the applicable performance-vesting conditions), these awards provide our executives with an ongoing incentive to continue their employment with the Company and to maximize stockholder value. We have not awarded stock options since our inception.

Pursuant to our long-term incentive award program, we annually award each named executive officer a target grant date value of long-term equity awards that, in combination with their respective total target cash compensation, is set at a level with reference to between approximately the 50th to 75th percentile of total target direct compensation provided by our Peer Group companies to their similarly situated executives. The compensation committee approved increases in the target grant date value of the annual equity awards for 2024 (which were granted in late 2023 as described below) to adjust for approximate cost of living increases. In addition, for Messrs. Sedgwick and Callister, the target grant date value increases reflected additional increases to adjust the target grant date value levels closer to peer comparison levels for similarly situated executives following their prior promotions to President and Chief Executive Officer and Chief Investment Officer, respectively, to account for their additional years of experience in those positions.

The annual equity awards granted under our long-term equity incentive award program are divided equally between time-based and performance-based awards. The time-based awards, which are awarded in the form of restricted stock, vest ratably over a three-year vesting period. The performance-based equity awards, which are awarded in the form of stock units, are eligible to cliff-vest at the end of a three-year performance period based on the Company’s TSR performance relative to a custom TSR peer group consisting of 16 other publicly traded healthcare REITs. We believe this is consistent with the practice at our Peer Group companies and will result in each named executive officer receiving a market-based long-term incentive opportunity each year.

As has been our practice since the equity grants made in December 2021, the compensation committee approves annual equity awards to our executive officers late in the fourth quarter of each calendar year. We believe making annual equity awards in the fourth quarter of each calendar year (instead of during the first quarter of each calendar year) better allows us to take our performance for the calendar year into account when determining the level of equity awards to be granted, while also ensuring that the applicable service period for those awards commences after their grant date.

Performance-based TSR awards granted under our long-term equity award program entitle the executive to receive an additional credit of stock units having a value equal to the amount of the ordinary cash dividends paid on the shares of common stock underlying the award (i.e., dividend equivalents are reinvested in additional units). Any additional stock units credited as a dividend equivalent payment will not be paid unless they vest and are subject to the same performance-based vesting requirements as the stock unit awards to which they relate.

The compensation committee believes that the structure of the performance-based TSR awards, which (1) cliff-vest at the end of three years, rather than being eligible to vest on an annual basis over the length of the performance period, (2) have a different performance metric (relative TSR) than any of the performance metrics used to measure performance for our annual cash incentive awards, and (3) become earned solely based on our TSR performance, creates a direct link between the value realized by our named executive officers and our stockholders.

2024 Annual Equity Awards. Consistent with the equity grant timing described above, the compensation committee approved annual equity awards for 2024 in December 2023. The time-based awards granted in December 2023 vest in three equal annual installments, that began January 31, 2025, subject to the named executive’s continued employment with the Company. The performance-based equity awards granted in December 2023 are eligible to cliff-vest at the end of a three-year performance period ending December 31, 2026 based on the Company’s TSR performance relative to a custom TSR peer group consisting of 14 other publicly traded healthcare REITs. The 2024 annual equity awards are intended as compensation to the named executive officers for 2024; however, because they were granted in December 2023, these 2024 annual equity awards were reported in the Summary Compensation Table as compensation to the named executive officers in 2023.

2025 Annual Equity Awards. Similar to the 2024 annual equity awards, the compensation committee approved annual equity awards for 2025 in December 2024. In making these awards, the compensation committee referred to information provided by Pearl Meyer with respect to the 2025 Peer Group as well as annual Nareit Compensation Survey information. The time-based awards granted in December 2024 vest in three equal annual installments beginning January 31, 2026, subject to the named executive’s continued employment with the Company. The performance-based equity awards granted in December 2024 will be eligible to cliff-vest at the end of a three-year performance period ending December 31, 2027 based on the Company’s TSR performance relative to a custom TSR peer group consisting of other publicly traded healthcare REITs. Although these 2025 annual equity awards are intended as compensation to the named executive officers for 2025, they are reported in the Summary Compensation Table as compensation to the named executive officers in 2024 because the grant date occurred in 2024.

The relative TSR performance-based awards for 2024 (which were granted in December 2023) will vest based on our three-year TSR performance relative to the following publicly-traded REITs:

*In March 2024, Physicians Realty Trust was merged with Healthpeak Properties, Inc.

The relative TSR performance awards for 2025 (which were granted in December 2024) will vest based on our three-year TSR performance relative to the same TSR award peer group used for the December 2023 awards, except that American Healthcare REIT, Inc. has been added following the merger of Healthpeak Properties, Inc. and Physicians Realty Trust.

We selected our TSR award peer group companies based on their similarity to the Company, taking into account their respective businesses and sources of revenue. While there is significant overlap between the TSR award peer group companies and the Peer Group companies described above, the two peer groups are not identical. This is because the compensation committee believes that the two peer groups are accomplishing different objectives. Many of the TSR award peer group companies have a larger or smaller market capitalization than the Company, which makes them inappropriate to use as peer companies for compensation comparison purposes. However, we believe company size plays a relatively small role in TSR, and that our TSR award peer group companies are valuable comparators to measure our TSR because of the similarity of business models and tenant pools.

If the Company’s TSR for the three-year performance period compared to the TSRs of the peers for the same period is less than the 25 th percentile (the threshold level), 0% of each named executive officers’ TSR awards will vest. If our relative TSR performance is at the 50 th percentile (the target level), 100% of each named executive officer’s TSR awards will vest. If the Company achieves relative TSR performance at or above the 85 th percentile (the maximum level), 200% of each named executive officer’s TSR awards will vest. For performance between target and the threshold and the high levels, the number of TSR awards that vest will be determined by linear interpolation.

The performance vesting schedule for the TSR awards can be illustrated as follows:

Special Equity Awards for 2024 Performance

In recognition of the record year and exceptional performance by our executive team in deploying more than $1.5 billion of capital for new investments, representing nearly five times more investments than any prior year, and while reaching a record low leverage level (based on 2024 average quarterly net debt to normalized run rate EBITDA) of 0.40x, in January 2025 the compensation committee approved a special restricted stock award to each of the Company’s executive officers having a grant date value equal to $1,242,000 for Mr. Sedgwick and $575,108 for each of Messrs. Wagner and Callister. Subject to continued employment by the executive, these special restricted stock awards vest on January 31, 2026. While these special equity awards are intended as compensation to the named executive officers for 2024, because they were granted in January 2025, the awards will be reported in the Summary Compensation Table as compensation to the named executive officers in 2025.

Status of Performance-Based Vesting of Prior Long-Term Incentive Awards

2022 TSR Equity Awards. The performance-based equity awards granted in December 2021 under the new long-term equity incentive award program in effect beginning in 2021 were eligible to cliff-vest at the end of a three-year performance period ended December 31, 2024 based on the Company’s TSR performance relative to a custom TSR peer group consisting of the same publicly traded healthcare REITs selected for the 2024 awards. The Company’s TSR for the three-year performance period of the awards was 49.12% and achieved a 72.69 th percentile compared to the TSR peer group, which resulted in a payout percentage of 164.83%.

For more information on these TSR awards and the TSR equity awards that were granted to our named executive officers in each of 2021, 2022 and 2023 based on the prior year’s performance, see our proxy statement filed in those years.

Severance Benefits

We believe that severance protections, particularly in the context of the uncertainty surrounding any potential change in control transaction, play a valuable role in attracting and retaining quality executive officers. Accordingly, we have entered into a change in control and severance agreement with each of our named executive officers (each, as amended, a “CIC and Severance Agreement”). We believe that the level of potential benefits helps us to retain our qualified executive team and is more consistent with the severance benefits provided by our Peer Group companies than our prior practice of providing no severance benefits to the named executive officers.

As described in more detail below under the heading “Potential Payments Upon Termination or Change in Control,” pursuant to the CIC and Severance Agreement, each of the named executive officers is entitled to severance benefits in the event of a termination of employment by us without “cause” or by the executive for “good reason” (as those terms are defined in each executive’s CIC and Severance Agreement), with the level of severance benefits enhanced if such a termination of employment occurs upon or following a change in control of the Company. None of the severance benefits payable under the CIC and Severance Agreement is a “single trigger” benefit triggered by the occurrence of a change in control, and benefits under the CIC and Severance Agreement are only payable on a “double trigger” basis as a result of a qualifying termination of employment. Also as described in more detail below under the heading “Potential Payments Upon Termination or Change in Control,” the CIC and Severance Agreement also entitles each named executive officer to specified benefits if the executive’s employment is terminated as a result of an “authorized retirement” or due to the executive’s death or “disability” (as such terms are defined in each executive’s CIC and Severance Agreement). No named executive officer is entitled to receive a “gross-up” or similar payment for any excise taxes that may become payable in connection with a change in control pursuant to Sections 280G and 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), and, depending on what results in the best after-tax benefit for the executive, benefits may be “cut back” instead in such circumstances.

In addition, under the terms of our stockholder-approved equity incentive plan, outstanding restricted stock or stock unit awards will be subject to accelerated vesting in connection with a change in control of the Company (with outstanding performance-based awards vesting at the targeted performance level). Please see the “Potential Payments Upon Termination or Change in Control” section below for additional details.

401(k) Retirement Plan

We adopted a 401(k) retirement plan that was originally effective as of June 1, 2014. Full-time employees who have completed three months of service have the opportunity to participate in the 401(k) plan. Our 401(k) plan is intended to qualify under Section 401 of the Code. Employees are able to elect to defer a portion of their eligible compensation not to exceed the statutorily prescribed annual limit in the form of elective deferral contributions to our 401(k) plan. Our 401(k) plan also has a “catch-up contribution” feature for employees eligible to defer amounts over the statutory limit that applies to all other employees. We provide a “safe harbor” nonelective contribution of 3% of each participant’s compensation per plan year at the end of each plan year. Participants are always vested in their personal contributions to the 401(k) plan, and Company nonelective contributions are also vested once made.