Sky Harbour Group Corp Stock Compensation Disclosure
| 14. | Equity Compensation |
On January 25, 2022, the Company's 2022 Incentive Award Plan (the “2022 Incentive Award Plan”) became effective following approval by the Company's shareholders. The 2022 Incentive Award Plan provides for grants of stock-based compensation awards, including without limitation, non-qualified stock options, incentive stock options, stock appreciation rights, or SARs, restricted stock awards, restricted stock unit awards, incentive unit awards other stock or cash based awards and dividend equivalent awards. Employees, officers, and consultants of the Company or any parent or affiliate, including Sky, or any non-employee director of the Company’s Board of Directors are eligible to receive awards under the 2022 Incentive Award Plan. An aggregate of approximately 6.2 million shares of Class A Common Stock are issuable pursuant to the 2022 Incentive Award Plan.
Restricted Stock Units (“RSUs”)
On an annual basis, the Company grants RSUs which have time-based conditions and are classified as equity awards. During the year ended December 31, 2025, the Company granted 437,930 time-based awards at a grant date fair value of $11.15 in February 2025 and granted 60,634 time-based awards at a grant date fair value of $9.77 in June 2025. During the year ended December 31, 2024, the Company granted 430,002 time-based RSUs to certain employees under the Company’s 2022 Incentive Award Plan at a weighted average grant date fair value of $12.33. The RSUs granted will vest ratably over a -year period beginning on the first anniversary of the respective grant date and ending on the fourth anniversary of the respective grant. All RSUs were valued at their fair market value, which was the closing price of the Company's stock on the date of the grant.
The following tables presents a summary of RSU activity for the years ended December 31, 2025 and 2024:
| Number of Shares | Weighted-Average Grant Date Fair Value | |||||||
| Unvested as of December 31, 2023 | 871,732 | $ | 6.65 | |||||
| RSUs Granted | 430,002 | 12.33 | ||||||
| RSUs Vested | (406,042 | ) | 6.89 | |||||
| RSUs Forfeited | (6,746 | ) | 11.71 | |||||
| Unvested as of December 31, 2024 | 888,946 | $ | 9.17 | |||||
| RSUs Granted | 498,564 | 10.98 | ||||||
| RSUs Vested | (474,199 | ) | 9.05 | |||||
| RSUs Forfeited | (29,558 | ) | 11.08 | |||||
| Unvested as of December 31, 2025 | 883,753 | $ | 10.20 | |||||
During the years ended December 31, 2025 and 2024, the Company recognized stock compensation expense of approximately $4.9 million and $3.4 million, respectively, associated with the RSUs within employee compensation and benefits within the consolidated statement of operations. The stock compensation expenses recognized for the year ended December 31, 2025 is inclusive of the recognition of approximately $0.7 million of expense associated with the accelerated vesting of unvested RSUs upon the departure of the Company's former Chief Operating Officer. The unrecognized compensation costs associated with all unvested RSUs at December 31, 2025 was approximately $7.3 million that is expected to be recognized over a weighted-average future period of 2.5 years.
Non-qualified Stock Options (“NSOs”)
During the year ended December 31, 2025, the Company granted to certain employees options to purchase 686,647 shares of Class A Common Stock at an exercise price of $11.07 under the Company’s 2022 Incentive Award Plan. During the year ended December 31, 2024, the Company granted to certain employees options to purchase 438,781 shares of Class A Common Stock at an exercise price of $11.63 under the Company's 2022 Incentive Award Plan. The NSOs vest ratably over a -year period beginning on the sixth anniversary of the grant date and have a term of years. All NSOs are valued using a Black -Scholes pricing model.
The following tables presents a summary of NSO activity for the years ended December 31, 2025 and 2024:
| Number of Options | Weighted-Average Exercise Price per Option | Weighted-Average Grant Date Fair Value | ||||||||||
| Outstanding as of December 31, 2023 | - | $ | - | $ | - | |||||||
| NSOs Granted | 438,781 | 11.63 | 7.32 | |||||||||
| NSOs Exercised | - | - | - | |||||||||
| NSOs Forfeited and expired | - | - | - | |||||||||
| Outstanding as of December 31, 2024 | 438,781 | $ | 11.63 | $ | 7.32 | |||||||
| NSOs Granted | 686,647 | 11.07 | 6.33 | |||||||||
| NSOs Exercised | - | - | - | |||||||||
| NSOs Forfeited and expired | - | - | - | |||||||||
| Outstanding as of December 31, 2025 | 1,125,428 | $ | 11.29 | $ | 6.72 |
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During the years ended December 31, 2025 and 2024, the Company recognized stock compensation expense of approximately $0.8 million and $0.3 million, respectively, associated with all NSO awards. The unrecognized compensation costs associated with all unvested NSOs at December 31, 2025 was approximately $6.5 million that is expected to be recognized over a weighted-average future period of 7.7 years.
Sky Incentive Units
The Company recognized equity-based compensation expense relating to awarded equity units of Sky (the “Sky Incentive Units”) of approximately $0.1 million and $0.2 million for the years ended December 31, 2025, and December 31, 2024, respectively. Expense associated with the Sky Incentive Units is recorded within employee compensation and benefits within the statement of operations, and as a component of the non-controlling interest in the consolidated statement of changes in stockholders’ equity. As of December 31, 2025, there was no unrecognized compensation expense associated with the Sky Incentive Units.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 19, 2026 | Showing above |
| 2024 | Mar 27, 2025 | |
| 2023 | Mar 27, 2024 | |
| 2022 | Mar 24, 2023 | |
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.