SHENANDOAH TELECOMMUNICATIONS CO/VA/SHEN
SHENANDOAH TELECOMMUNICATIONS CO/VA/ Stock Compensation Disclosure
Stock Compensation and Earnings per Share
The Company’s 2024 Equity Incentive Plan (the “Plan”) allows for the grant of equity based incentive compensation to all employees. The Plan authorizes grants of up to an additional 3,000,000 shares over a ten-year period. Under the Plan, grants may take the form of stock awards, awards of options to acquire stock, stock appreciation rights and other forms of equity based compensation. As of December 31, 2025, the only forms of stock awards outstanding are restricted stock units (“RSUs”) and Relative Total Shareholder Return RSUs (“RTSRs”) and there were 2,019,617 shares available for future issuance under the Plan.
The Company’s RSUs generally have service conditions only or performance and service conditions with vesting periods ranging from one year for directors to five years for employees. RSUs that have both performance and service conditions are referred to as performance stock units (“PSUs”). The actual number of shares to be issued upon PSU performance measurement can range from 0% to 100% of the awards granted.
RTSRs vest approximately three years from the grant date. The performance condition applied to the RTSR awards is based upon the Company’s stock performance compared to a group of peer companies. The actual number of shares to be issued upon RTSRs performance measurement can range from 0% to 150% of the awards granted.
Activity related to the Company’s equity compensation, which includes the Company’s RSUs and PSUs, was as follows:
| (in thousands, except weighted average grant price) | Number of Shares | Weighted Average Grant Price | |||||||||
Outstanding awards, December 31, 2022 | 649 | $ | 23.39 | ||||||||
| Granted | 385 | 19.05 | |||||||||
Vested | (200) | 25.01 | |||||||||
| Forfeited | (9) | 21.67 | |||||||||
Outstanding awards, December 31, 2023 | 825 | $ | 21.16 | ||||||||
| Granted | 403 | 20.22 | |||||||||
Vested | (308) | 21.74 | |||||||||
| Forfeited | (45) | 19.44 | |||||||||
Outstanding awards, December 31, 2024 | 875 | $ | 20.63 | ||||||||
| Granted | 756 | 12.06 | |||||||||
Vested | (369) | 20.58 | |||||||||
| Forfeited | (75) | 17.39 | |||||||||
Outstanding awards, December 31, 2025 | 1,187 | $ | 15.39 | ||||||||
The total fair value of RSUs vested was $4.4 million during the year ended December 31, 2025.
Activity related to the Company’s RTSRs was as follows:
| (in thousands, except weighted average grant price) | Number of Shares | Weighted Average Grant Price | |||||||||
Outstanding awards, December 31, 2022 | 202 | $ | 29.46 | ||||||||
| Granted | 134 | 23.64 | |||||||||
Vested | (30) | 36.27 | |||||||||
| Forfeited | (13) | 36.27 | |||||||||
Outstanding awards, December 31, 2023 | 293 | $ | 25.80 | ||||||||
| Granted | 136 | 22.30 | |||||||||
Vested | (32) | 34.05 | |||||||||
| Forfeited | (138) | 25.74 | |||||||||
Outstanding awards, December 31, 2024 | 259 | $ | 22.96 | ||||||||
| Granted | 246 | 12.31 | |||||||||
Vested | (71) | 23.64 | |||||||||
| Forfeited | (74) | 21.93 | |||||||||
Outstanding awards, December 31, 2025 | 360 | $ | 15.77 | ||||||||
The total fair value of RTSRs vested was $0.8 million during the year ended December 31, 2025.
Stock-based compensation expense was as follows:
| Years Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| Stock compensation expense | $ | 10,463 | $ | 10,651 | $ | 10,823 | |||||||||||
| Capitalized stock compensation | (873) | (814) | (790) | ||||||||||||||
| Stock compensation expense, net | $ | 9,590 | $ | 9,837 | $ | 10,033 | |||||||||||
As of December 31, 2025, there was $6.8 million of total unrecognized compensation cost related to non-vested incentive awards which is expected to be recognized over weighted average period of 2.2 years.
The following table indicates the computation of basic and diluted earnings (loss) per share:
| Years Ended December 31, | |||||||||||||||||
| (in thousands, except per share amounts) | 2025 | 2024 | 2023 | ||||||||||||||
| Calculation of net (loss) income per share: | |||||||||||||||||
| (Loss) income from continuing operations | $ | (32,943) | $ | (28,357) | $ | 1,016 | |||||||||||
| Income from discontinued operations, net of tax | — | 222,174 | 7,022 | ||||||||||||||
| Net (loss) income | $ | (32,943) | $ | 193,817 | $ | 8,038 | |||||||||||
| Amounts attributable to common shareholders | |||||||||||||||||
| (Loss) income from continuing operations | $ | (39,392) | $ | (31,786) | $ | 1,016 | |||||||||||
| Income from discontinued operations, net of tax | — | 222,174 | 7,022 | ||||||||||||||
| Net (loss) income attributable to common shareholders | $ | (39,392) | $ | 190,388 | $ | 8,038 | |||||||||||
| Basic weighted average shares outstanding | 55,100 | 53,722 | 50,396 | ||||||||||||||
| Per share amounts attributable to common shareholders | |||||||||||||||||
| Basic net (loss) income per share - continuing operations | $ | (0.71) | $ | (0.59) | $ | 0.02 | |||||||||||
| Basic net income per share - discontinued operations | — | 4.13 | 0.14 | ||||||||||||||
| Basic net (loss) income per share | $ | (0.71) | $ | 3.54 | $ | 0.16 | |||||||||||
| Effect of stock-based compensation awards outstanding: | |||||||||||||||||
| Basic weighted average shares outstanding | 55,100 | 53,722 | 50,396 | ||||||||||||||
| Effect from dilutive shares and options outstanding | — | — | 319 | ||||||||||||||
| Diluted weighted average shares outstanding | 55,100 | 53,722 | 50,715 | ||||||||||||||
| Diluted net (loss) income per share - continuing operations | $ | (0.71) | $ | (0.59) | $ | 0.02 | |||||||||||
| Diluted net income per share - discontinued operations | — | 4.13 | 0.14 | ||||||||||||||
| Diluted net (loss) income per share | $ | (0.71) | $ | 3.54 | $ | 0.16 | |||||||||||
The Company applies the two-class method when computing net income (loss) per share attributable to common shareholders as the Company has issued preferred stock that meets the definition of a participating security. The Company considers Series A Preferred Stock to be a participating security as the holders are entitled to receive cumulative dividends.
The Company determines the dilutive impact of equity awards and the Series A Preferred Stock (on an as-converted basis) by applying the treasury stock method and the if-converted method, respectively. The following table presents potentially dilutive instruments:
| Years Ended December 31, | |||||||||||||||||
(in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
Potentially dilutive equity awards | 506 | 325 | 319 | ||||||||||||||
Potentially dilutive shares related to the Series A Preferred Stock | 3,679 | 3,432 | — | ||||||||||||||
Total potentially dilutive instruments | 4,185 | 3,757 | 319 | ||||||||||||||
Potentially dilutive instruments were excluded from the calculation of diluted weighted average shares outstanding for the years ended December 31, 2025 and 2024, due to the fact that they were anti-dilutive as a result of the Company’s loss from continuing operations for the applicable periods. Additionally, there were approximately 117,000 anti-dilutive awards outstanding for the year ended December 31, 2023.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 21, 2024 | |
| 2022 | Feb 22, 2023 | |
| 2021 | Feb 28, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 26, 2020 | |
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.