The Delaware Restricted Stock Plan of RPM, Inc. is an employee benefit program that offers selected employees of RPM, Inc. the opportunity to obtain company stock under specific conditions and restrictions. This plan aims to incentivize and reward employees for their dedication and contribution to the company's growth and success. By providing employees with stock ownership, the plan aligns their interests with those of RPM, Inc. and promotes a sense of ownership and commitment. Under the Delaware Restricted Stock Plan, eligible employees are granted restricted stock units (RSS), which represent a right to receive shares of RPM, Inc. stock at a predetermined future date. This RSS typically vest over a certain period, encouraging employees to stay with the company in order to unlock the full benefits of their stock grants. The plan sets various requirements and restrictions on the RSS. Employees may need to meet specific performance goals, complete a certain number of years of service, or fulfill other predetermined conditions in order to receive the granted shares. This ensures that only employees who meet the designated criteria can benefit from the stock plan. Delaware law governs the RPM, Inc. Restricted Stock Plan, precisely because RPM, Inc. is incorporated in the state of Delaware. The plan complies with the regulations set out by the Delaware General Corporation Law, ensuring a legally compliant and transparent framework for the stock program. The Delaware Restricted Stock Plan of RPM, Inc. can be further classified into different types based on eligibility criteria and vesting schedules. Some possible types of plans include: 1. Standard Vesting Plan: This type of plan could grant RSS to employees that vest over a certain number of years of continuous service with RPM, Inc. For example, an employee might receive 1,000 RSS that vest equally over a four-year period, with a 25% vesting each year. 2. Performance-Based Plan: In this variation of the Delaware Restricted Stock Plan, employees must meet specific performance objectives or targets to qualify for the RSU grants. The performance metrics could be tied to individual, team, or company-wide goals and can ensure that the stock ownership aligns directly with RPM, Inc.'s strategic objectives. 3. Promotional/Retention Plan: This type of plan might be designed to reward employees for taking on higher-level roles or to encourage them to remain with RPM, Inc. for a certain period. For example, an employee who is being promoted to a managerial position might receive a grant of RSS that vest over a three-year period, incentivizing them to excel in their new role. In summary, the Delaware Restricted Stock Plan of RPM, Inc. is an employee incentive program offering RSS to eligible employees based on specific conditions. It serves to align employees' interests with the company's goals, promote tenure, performance, and employee retention. The plan complies with Delaware law and may take different forms based on various eligibility criteria and vesting schedules.
Delaware Restricted Stock Plan of RPM, Inc.
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Restricted stock units are a form of stock-based employee compensation. RSUs are restricted during a vesting period that may last several years, during which time they cannot be sold. Once they are vested, RSUs can be sold or kept like any other shares of company stock.
Restricted stocks are unregistered shares that are non-transferable for holders until they meet certain conditions. Well-established companies offer restricted stocks to company executives and directors as a form of equity compensation. Some restrictive conditions may be particular tenure or specific performance goals.
Once vested, RSUs shift from a future promise to the owned property of the recipient. This ?property? most often comes in shares of company stock, but RSUs may also be paid out via cash compensation. Your plan document should tell you more about exactly how your RSUs are set up.
Long-term capital gains rates are likely the lowest tax on your company shares. In order to minimize your RSU taxes as much as possible, it's typically advisable to hold your shares for at least one year after the exercise date to qualify for long-term capital gains taxes.
With restricted stock and RSUs, you almost always forfeit whatever stock has not vested at the time of your termination, unless your grant specifies another treatment or the company decides to continue or accelerate vesting.
RSUs compensation is taxed at your ordinary-income tax rate. If you choose to hold your shares after they vest, any gain (or loss) is taxed as a capital gain (or loss).
With restricted stock and restricted stock units, upon job termination you almost always forfeit whatever stock has not vested. Exceptions can occur, depending on the vesting terms of your employment agreement or stock plan, such as special provisions for disability, retirement, or an acquisition.
Restricted stock (also called letter stock or section 1244 stock) is usually awarded to company directors and other high-level executives, whereas restricted stock units (RSUs) are typically awarded to lower-level employees. Restricted stock tends to have more conditions and restrictions than an RSU.