On November 27, 2006, the Board of Directors of Shenandoah Telecommunications Company (the “Company”), upon a recommendation of its Personnel Committee, approved a plan to freeze benefit accruals for all participants in the Shenandoah Telephone Company Retirement Plan (the “Defined Benefit Plan”) and to terminate the plan effective January 31, 2007.

Concurrent with the benefit freeze and termination of the Defined Benefit Plan the Board approved an increase in the amount of the Company’s contribution to the Company’s 401(k) Supplemental Retirement Plan (the “401(k) Plan”) pursuant to which, in addition to the current matching contributions, the Company will contribute 5% of compensation (subject to IRS limits), of which the first 3% shall immediately vest and the remaining 2% will vest after an employee first completes three years of service.

Benefits under the Company’s Executive Supplemental Retirement Plan (“SERP”) were also frozen effective January 31, 2007, and the Board approved plans to adopt a new non-qualified Executive Supplemental Retirement Plan which would replace the existing SERP with a contribution equal to 7% of a participant’s cash compensation. Unlike the existing SERP, the new Executive Supplemental Retirement Plan would be funded with contributions to a “rabbi trust” for each participant.

The executive officers of the Company are participants in the Defined Benefit Plan and the SERP and therefore the executive officers’ future accruals of benefits under the Defined Benefit Plan and SERP will be frozen as of January 31, 2007. They are also participants in the 401(k) Plan, and will be participants in the new Executive Supplemental Retirement Plan, and will be eligible for benefits under these plans, subject to IRS limits in regards to the additional contributions under the 401(k) Plan.

The Company also announced a voluntary early retirement incentive program for certain eligible participants in the Defined Benefit Plan. This incentive program enhances a participant’s retirement benefit calculation by adding up to five additional years of service and age to the participant’s actual service and age. In addition, for purposes of determining early retirement eligibility and the reduction for early benefit commencement, those years will be added to both the age and years of service for the participant who elects to take advantage of the early retirement incentive program. There are 58 people who are eligible to receive this enhanced benefit including 3 executive officers of the Company. We currently do not know how many, if any, of the eligible participants will elect to retire under this early retirement incentive program, and we therefore are unable to determine the one time costs, if any, associated with this early retirement incentive program or the potential ongoing annual savings, if any, that may result from the potential reduction in personnel.

The Company further announced that, along with the employees that select the early retirement option, it will use attrition and an involuntary reduction in force to eliminate up to 50 positions. Severance benefits of various amounts, depending on the pay grade and length of service of the affected employees, would be payable under the reduction in force. We currently do not know how many involuntary position

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