v3.26.1
Stockholders' Deficit
 6 Months Ended
Jun. 30, 2026
Equity [Abstract]  
Stockholders' Deficit Stockholders' Deficit
Stock Options

During the six months ended June 30, 2026, eligible option holders tendered 70,876 options to purchase 70,876 shares of Townsquare common stock.

During the six months ended June 30, 2026, the Company granted 250,000 and 83,340 options with grant date fair values of $1.00 and $1.10, respectively, and vesting periods of three years, each with ten-year terms. The Company also granted 280,129 options with grant date fair values of $0.82 to $0.97. These options contain market conditions whereby the options will vest and become exercisable subject to the achievement of a specified volume weighted average trading price ("VWAP") over a specified period and continued employment through the performance period each as observed and summarized below, respectively:

VWAP over 20 consecutive trading days of the three-year performance period
VWAPNumber of Options that Vest
$7.8785,911
$9.1892,593
$10.50101,625
280,129

No portion of the grants will vest unless the VWAP targets are achieved during the respective performance period.

The grant date fair value of stock options with market conditions is estimated using the Monte Carlo option pricing model, while stock options containing only service conditions is estimated using the Black-Scholes option pricing model. Each model requires an estimate of the expected term of the option, the expected volatility of the Company’s common stock price, dividend yield and the risk-free interest rate. The below table summarizes the assumptions used to estimate the fair value of the equity options granted:

Monte Carlo ModelBlack-Scholes Model
Expected volatility
44.9%
48.1%
Expected term
4.0 years
6.01 years
Risk free interest rate
4.19%
4.01% - 4.26%
Expected dividend yield
12.20%
11.68% - 12.20%

For options only containing service conditions, the expected term was calculated using the simplified method, defined as the midpoint between the vesting period and the contractual term of each award, due to the lack of sufficient and meaningful historical exercise data. For options with market-based conditions, the expected term was estimated based on when the options are expected to be exercised. The expected volatility was based on market conditions of the Company. The risk-free interest rate was based on the U.S. Treasury yield curve in effect on the date of grant which most closely corresponds to the expected term of the option.

The following table summarizes all option activity for the six months ended June 30, 2026:
OptionsWeighted Average Exercise PriceWeighted Average Remaining Contractual Life (years)Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 20256,859,321 $7.21 5.56$11 
  Granted - service conditions333,340 6.63 
  Granted - market conditions280,129 6.56 
  Exercised(70,876)5.87 74 
  Forfeited and expired(346,691)7.82 
Outstanding at June 30, 20267,055,223 $7.14 5.42$1,917 
Exercisable at June 30, 20264,820,811 $7.02 4.61$1,562 

The maximum contractual term of stock options is 10 years.

Restricted Stock Awards

During the six months ended June 30, 2026, the Company granted 140,911 restricted stock awards, including 120,150 shares to non-employee directors, with vesting periods of one to three years. The fair value of the restricted stock awards is equal to the closing share price on the date of grant.

The following table summarizes restricted stock activity for the six months ended June 30, 2026:

Number of SharesWeighted Average Fair Value
Non-vested balance at January 1, 2026138,235$9.06 
  Shares granted140,911 5.52 
  Shares vested(89,179)8.73 
Non-vested balance at June 30, 2026189,967$6.60 

Restricted Stock Units

The following table summarizes restricted stock unit activity for the six months ended June 30, 2026:

Number of SharesWeighted Average Fair Value
Non-vested balance at January 1, 20261,120,393$7.29 
  Shares granted - service conditions582,482 5.42 
  Shares granted - market conditions890,030 5.41 
  Bonus shares granted871,452 5.57 
  Shares vested(1,359,780)5.81 
  Shares canceled - market conditions(218,543)4.21 
Non-vested balance at June 30, 20261,886,034$5.32 

During the six months ended June 30, 2026, the Company granted 582,482 stock units with vesting periods ranging from vested at grant date to three years, and 871,452 bonus stock units that were vested at the grant date. The fair values of these restricted stock units were equal to the closing share price on the date of grant.
During the six months ended June 30, 2026, the Company granted 890,030 restricted stock units with a vesting period of three years and grant date fair values ranging from $2.06 - $3.63. The stock units contain market conditions whereby the stock units will vest subject to the achievement of a specified VWAP, subject to continued employment or service through the end of the performance period as observed and summarized below:

VWAP over a period of 20 consecutive trading days of the three-year performance period
VWAPNumber of Shares that Vest
$6.49216,990
$7.57289,054
$8.66383,986

The grant date fair value of the restricted stock units with market conditions is estimated using the Monte Carlo option pricing model. The below table summarizes the assumptions used to estimate the fair value of the restricted stock units granted:

Monte Carlo Model
Expected volatility41.3%
Risk free interest rate3.59%
Expected dividend yield14.7%

The expected volatility was based on market conditions of the Company. The risk-free interest rate was based on the U.S. Treasury yield curve in effect on the date of grant which most closely corresponds to the vesting period of the restricted stock units.

Employee Stock Purchase Plan

During the six months ended June 30, 2026, a total of 37,671 shares of Class A common stock were issued under the 2021 Employee Stock Purchase Plan (the "ESPP").

Stock Bonus Program

In 2024, the Company implemented a stock bonus program that offered certain employees the option to receive their annual incentive compensation in the form of the Company's Class A common stock. The incentive compensation to be paid to each employee is fixed at the time of election to participate in the program and the number of shares to be issued is determined based on the closing price of the Company's Class A common stock on the settlement date, primarily in the fourth quarter of the performance year or during the first quarter following each respective performance year. During the three and six months ended June 30, 2026 a total of $1.3 million and $2.3 million of expense was recognized as a component of stock-based compensation in connection with the stock bonus program, respectively. During the three and six months ended June 30, 2025 a total of $1.2 million and $2.1 million of expense was recognized as a component of stock-based compensation in connection with the stock bonus program, respectively.

During the six months ended June 30, 2026, and 2025 a total of 871,452 and 566,359 shares were granted under the Stock Bonus Program for each of the performance years ended December 31, 2025, and 2024, respectively,

For the three months ended June 30, 2026 and 2025, the Company recognized approximately $3.3 million and $3.8 million, respectively, of stock-based compensation expense with respect to options, restricted stock awards, restricted stock units and the ESPP. For the six months ended June 30, 2026 and 2025, the Company recognized approximately $7.0 million and $8.0 million, respectively, of stock-based compensation expense with respect to options, restricted stock awards, restricted stock units, the stock bonus program and the ESPP.

As of June 30, 2026, total unrecognized stock-based compensation expense related to our stock options and restricted stock was $1.5 million and $5.5 million, respectively, and is expected to be recognized over a weighted average period of 3.6 years and 1.7 years, respectively.
Dividends Declared

On October 29, 2025, the board of directors approved a quarterly cash dividend of $0.20 per share. The dividend of $3.3 million was paid to holders of record as of January 26, 2026, on February 2, 2026.

On March 4, 2026, the board of directors approved a quarterly dividend of $0.20 per share. The dividend of $3.6 million was paid to holders of record as of April 27, 2026, on May 4, 2026.

On May 1, 2026, the board of directors approved a quarterly cash dividend of $0.20 per share. The dividend of $3.6 million was paid to holders on record as of July 27, 2026, on August 3, 2026.

On August 4, 2026, the board of directors approved a quarterly cash dividend of $0.20 per share. The dividend will be payable on November 2, 2026 to shareholders of record as of the close of business on October 26, 2026.