Restricted Stock Units

A stock option plan is a form of security-based compensation, typically used to offer stock options for the benefit of employees or other service providers. It is usually used to compensate, retain, and attract employees or compensate directors and other service providers.

• What are restricted stock units?

Companies usually offer incentives to attract good talent. One of them is the RSU, an equity compensation that grants you company shares that are subject to a vesting schedule. You'll get ownership rights to the RSU when you complete a certain number of years in the company.

• Is it better to take RSU or stock options?

Restricted stock options vs stock options? Both have different pros and cons and what to choose depends on your preferences. We suggest that you get in touch with a financial advisor to help you make an informed decision on what to choose. You can self-study RSUs or hire a financial planner to ensure you're making the best decision.

One of the factors to consider is the taxes as how much benefit you get depends on them. Please reach out to us so we can help.

• How do you calculate restricted stock units?

It's calculated based on the vesting schedule, where shares are owned when the employee stays a certain number of years or the employee reaches certain milestones. They can also use cliff vesting where the restricted stock units are owned after a certain number of years.

• How long do RSUs take to vest?

Under the standard rule, your RSUs are considered fully vested after four years. One-quarter of your RSU shares may vest after your first year with the company and 1/36 of the remaining shares will vest each month, until you're considered fully vested.

Should the employee die while holding RSUs that are unvested, they will immediately vest. All RSUs may be paid out either in shares or cash, depending on the company's discretion.