STONERIDGE INCSRI
STONERIDGE INC Stock Compensation Disclosure
Share-Based Compensation Plans
In May 2025, the Company’s shareholders approved the 2025 Long-Term Incentive Plan (the “2025 Plan”) and reserved 726,000 Common Shares (of which the maximum number of Common Shares which may be issued). Under the 2025 Plan, as of December 31, 2025, the Company has issued 129,552 restricted Common Shares. As of December 31, 2025, none of the shares granted have been forfeited. There are 596,448 shares available to be granted under the 2025 Plan at December 31, 2025.
In May 2016, the Company’s shareholders approved the 2016 Long-Term Incentive Plan (the “2016 Plan”) and reserved 1,800,000 Common Shares (of which the maximum number of Common Shares which may be issued). In May 2020, the Company’s shareholders approved an amendment to the 2016 Plan to increase by 1,100,000 the number of Common Shares authorized for issuance. The amendment to the 2016 Plan brought the total Common Shares available for issuance to 2,900,000. Under the 2016 Plan, as of December 31, 2025, the Company has granted 4,819,921 share units, of which 1,978,340 were time-based with cliff vesting using the straight-line method and 2,841,581 were performance-based. As of December 31, 2025, 2,021,167 of the shares granted have been forfeited. There are 101,246 shares available to be granted under the 2016 Plan at December 31, 2025.
In 2025, 2024 and 2023, pursuant to the 2016 Plan, the Company granted time-based share units and performance-based performance share units. The majority of the time-based share units cliff vest three years after the date of grant. The performance-based performance share units vest and are no longer subject to forfeiture upon the recipient remaining an employee of the Company for three years from the date of grant and, for a portion of the annual awards, upon the Company attaining certain targets of performance measured against a peer group’s three year performance in terms of total shareholder return and, for the remaining portion of the annual awards, upon achieving certain earnings per share targets and return on invested capital targets established by the Company during the performance period of the award.
The allocation of performance shares granted between total shareholder return, earnings per share and return on invested capital were as follows for the years ended December 31:
| 2025 | 2024 | 2023 | |||||||||||||||
| Total shareholder return | 100 | % | 46 | % | 46 | % | |||||||||||
| Earnings per share | — | % | 36 | % | 36 | % | |||||||||||
| Return on invested capital | — | % | 18 | % | 18 | % | |||||||||||
In 2023, the Company granted retention-based phantom shares to certain employees that vested in June 2025 for $986. The phantom shares were settled in cash based on the volume-weighted average closing price of the Company's Common Shares for a 30 day period prior to the vesting date of $5.61.
In 2025, the Company granted time-based and performance-based phantom shares to certain employees that vest in March 2028, provided the employee remains employed with the Company. The time-based phantom shares will settle in cash based on the Common Share price as of the vesting date and the performance-based phantom shares will be measured upon the Company attaining certain targets of performance measured against a peer group’s three year performance in terms of total shareholder return. As of December 31, 2025, the Company has recorded a liability of $47 for the phantom shares which was included on the consolidated balance sheet as a component of accrued expenses and other long-term liabilities.
In April 2005, the Company adopted the Directors’ Restricted Shares Plan (the “Director Share Plan”) and reserved 500,000 Common Shares for issuance under the Director Share Plan. In May 2013, shareholders approved an amendment to the Director Share Plan to increase the number of shares for issuance by 200,000 to 700,000. In May 2018, the Company’s shareholders approved the 2018 Amended and Restated Director’s Restricted Shares Plan (the "2018 Director Share Plan") to increase the number of shares for issuance by 150,000 to 850,000. In May 2022, the Company's shareholders approved Amendment No. 1 to the 2018 Director Share Plan to increase the number of shares for issuance by 100,000 to 950,000. In May 2024, the Company's shareholders approved Amendment No. 2 to the 2018 Director Share Plan to increase the number of shares for issuance by 200,000 to 1,150,000. In December 2025, the Company terminated the 2018 Director Share Plan, and no further grants may be made pursuant to that plan. Under the 2018 Director Share Plan, the Company cumulatively issued 1,011,692 restricted Common Shares. Shares issued annually under the 2018 Director Share Plan were no longer subject to forfeiture one year after the date of grant.
Share Units and Performance Shares
The fair value of the non-vested time-based share unit awards was calculated using the market value of the Common Shares on the date of issuance. The weighted-average grant-date fair value of time-based share units granted during the years ended December 31, 2025, 2024 and 2023 was $5.16, $16.35, and $18.48, respectively.
The fair value of the non-vested performance-based performance share awards with a performance condition requiring the Company to obtain certain earnings per share and return on invested capital targets were estimated using the market value of the shares on the date of grant. The fair value of non-vested performance-based performance share awards with a market condition requiring the Company to obtain a total shareholder return target relative to a group of peer companies was estimated using a Monte Carlo valuation model taking into consideration the probability of achievement using multiple simulations. The awards that use earnings per share and return on invested capital as the performance target are expensed beginning when it is probable that the Company will meet the underlying performance condition.
A summary of the status of the Company’s non-vested share units and performance shares as of December 31, 2025 and the changes during the year then ended, are presented below:
| Time-based awards | Performance-based awards | ||||||||||||||||||||||
| Share units | Weighted- average grant date fair value | Performance shares | Weighted- average grant date fair value | ||||||||||||||||||||
| Non-vested as of January 1, 2025 | 409,088 | $ | 16.83 | 605,311 | $ | 18.24 | |||||||||||||||||
| Granted | 673,965 | $ | 5.16 | 567,616 | $ | 7.54 | |||||||||||||||||
| Vested | (244,923) | $ | 11.55 | (42,434) | $ | 13.74 | |||||||||||||||||
| Forfeited or cancelled | (48,593) | $ | 10.07 | (221,203) | $ | 17.74 | |||||||||||||||||
| Non-vested as of December 31, 2025 | 789,537 | $ | 8.92 | 909,290 | $ | 11.89 | |||||||||||||||||
A summary of the status of the Company’s non-vested share units and performance shares as of December 31, 2024 and the changes during the year then ended, are presented below:
| Time-based awards | Performance-based awards | ||||||||||||||||||||||
| Share units | Weighted- average grant date fair value | Performance shares | Weighted- average grant date fair value | ||||||||||||||||||||
| Non-vested as of January 1, 2024 | 410,716 | $ | 20.35 | 418,949 | $ | 21.89 | |||||||||||||||||
| Granted | 200,518 | $ | 16.35 | 301,276 | $ | 17.84 | |||||||||||||||||
| Vested | (176,583) | $ | 24.22 | (13,182) | $ | 18.65 | |||||||||||||||||
| Forfeited or cancelled | (25,563) | $ | 18.61 | (101,732) | $ | 32.02 | |||||||||||||||||
| Non-vested as of December 31, 2024 | 409,088 | $ | 16.83 | 605,311 | $ | 18.24 | |||||||||||||||||
As of December 31, 2025, total unrecognized compensation cost related to non-vested time-based share units granted was $1,955. That cost is expected to be recognized over a weighted-average period of 1.41 years.
For the years ended December 31, 2025, 2024 and 2023, the total fair value of awards vested was $1,724, $3,146 and $5,623, respectively.
As of December 31, 2025, there was no unrecognized compensation cost related to non-vested performance shares granted that are probable to vest. As noted above, the Company has issued and outstanding performance-based share units that use different performance targets (total shareholder return, earnings per share and return on invested capital).
The excess tax deficiency realized from the vesting of share units and performance shares of the share-based payment arrangements was $475, $248 and $230 for the years ended December 31, 2025, 2024 and 2023, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 16, 2026 | Showing above |
| 2024 | Mar 3, 2025 | |
| 2023 | Mar 1, 2024 | |
| 2022 | Mar 2, 2023 | |
| 2021 | Feb 28, 2022 | |
| 2020 | Feb 24, 2021 | |
| 2019 | Feb 27, 2020 | |
| 2018 | Feb 28, 2019 | |
| 2017 | Mar 7, 2018 | |
| 2016 | Mar 2, 2017 | |
| 2015 | Mar 14, 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.