Get 2006 Equity Plan-rsu Agr-employees Performance Final .d - Sec

Restricted Stock Units (RSUs): RSUs promise an employee common company stock based on certain vesting conditions. These conditions typically pass a specific time or vesting period. Employees rarely have to pay for RSUs, but they do not own the shares until the vesting period ends.

With RSUs, there's usually a clear vesting and delivery schedule you can count on for estimating taxes and engaging in financial planning. With performance award delivery, it may take time for your company to verify whether you've met your metrics.

A restricted stock unit (RSU) is an award of stock shares, usually given as a form of employee compensation. The recipient must meet certain conditions before the restricted stock units are transferred to the owner.

For example, an RSU grant might vest 25% each year over four years, with the first portion vesting after the first year and subsequent portions vesting quarterly or annually after that. In cliff-based vesting, there is a waiting period, typically one year, before any RSUs begin to vest.

RSUs have no actual financial value to the employee when issued. However, once they vest, employees can receive shares of stock or, less commonly, an equivalent value in cash. Until the RSUs vest, they remain an unfunded promise to compensate the recipient at some point in the future.

Selling RSUs immediately upon vesting is a common approach for many individuals. The reason behind this strategy is to avoid any potential decline in the company's stock value. By selling right away, you can lock in the value of your shares and mitigate potential risks tied to stock market fluctuations.

RSUs offer employees the opportunity for financial gain if the company performs well and the stock price increases. Unlike traditional stock options, which may require employees to pay upfront to receive the actual stock, RSUs do not require employees to pay anything to receive them.

Your company will grant you a set number of performance shares up front, which is called a target amount. Awards are subsequently adjusted up or down based on your company's performance or your individual performance. Typically, the better your company performs, the more shares you'll receive.