Armour Residential REIT, Inc.ARR

Armour Residential REIT, Inc. Stock Compensation Disclosure

10-KFiled Feb 18, 20262 min read
Note 9 - Stock Based Compensation
We adopted the Plan to attract, retain and reward directors and other persons who provide services to us in the course of operations. The Plan authorizes the Board to grant awards including common stock, restricted shares of common stock (“RSUs”), stock options, performance shares, performance units, stock appreciation rights and other equity and cash-based awards (collectively, “Awards”), subject to terms as provided in the Plan. At December 31, 2025, there were 3 shares available for future issuance under the Plan.
Transactions related to awards for the years ended December 31, 2025, December 31, 2024 and December 31, 2023 are summarized below:
For the Years Ended
 December 31, 2025December 31, 2024December 31, 2023
 
Number of
Awards
Weighted
Average Grant Date Fair Value per Award
Number of
Awards
Weighted
Average Grant Date Fair Value per Award
Number of
Awards
Weighted
Average Grant Date Fair Value per Award
Unvested RSU Awards Outstanding beginning of period170 $36.38 298 $38.21 114 $64.40 
Granted (1)
225 $16.60 — $— 260 $29.65 
Vested(70)$33.19 (73)$48.90 (76)$48.24 
Forfeited— $— (55)$29.65 — $— 
Unvested RSU Awards Outstanding end of period325 $23.37 170 $36.38 298 $38.21 
(1)During the year ended December 31, 2025 135 RSUs were granted to certain officers of ARMOUR and 90 RSUs were granted to the Board. During the year ended December 31, 2023, 196 RSUs were granted to certain officers of ARMOUR and 64 RSUs were granted to the Board.
At December 31, 2025, there was approximately $7,602 of unvested stock based compensation related to the Awards (based on a weighted grant date price of $23.37 per share), which we expect to recognize as an expense as follows: in 2026 an expense of $2,540, in 2027 an expense of $2,062, and thereafter an expense of $3,000. Our policy is to account for forfeitures as they occur. We also pay each of our non-executive Board members quarterly fees of $33, which are payable in cash, common stock, RSUs or a combination of common stock, RSUs and cash at the option of the director. Non-executive Board members have the option to participate in the Company's Non-Management Director Compensation and Deferral Program (the "Deferral Program"). The Deferral Program permits non-executive Board members to elect to receive either common stock or RSUs or a combination of common stock and RSUs at the option of the director, instead of all or part of their quarterly cash compensation and/or all or part of their committee and chairperson cash retainers.

Historical Timeline

Fiscal YearFiled
2025Feb 18, 2026Showing above
2024Feb 12, 2025
2017Feb 14, 2018

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.

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