Not Yet Registered?
You can have access to our in-depth exclusive content on NQDC in just a few clicks.
Technically, a grant of restricted stock units is an unfunded promise to issue a specific number of shares (or a cash payment) at a future time once vesting conditions have been satisfied. Stock-settled RSUs are much more common than cash-settled RSUs (which are subject to unpopular variable accounting), and they are used widely enough to rival the use of standard restricted stock. RSU grants can offer the ability to defer the delivery of the shares to a time later than the vesting date, which can make them a form of nonqualified deferred compensation. For more on RSUs, including the deferral of RSU shares, see the section on restricted stock units at myStockOptions.com.