Sample Restricted Stock Unit RSU Plans

Sample_Documents

DISCLAIMER: This is a sample template provided for informational purposes only. It does not constitute legal, tax, or financial advice. Organizations should consult their own legal and tax advisors and tailor this document to reflect their specific business needs, geographies, and applicable laws.

Restricted Stock Unit (RSU) Plans: Policy and Administration Guide for <Company Name>

Document Type: Restricted Stock Unit (RSU) Plans

Category: Variable Compensation

Company: <Company Name>

Version: v<Version Number>

Effective Date: <Effective Date>

Last Reviewed: <Date>

Next Scheduled Review: <Date> (annual review or upon material change)

Document Owner: <Title of Document Owner, e.g., Head of Total Rewards>

Approving Body: <Compensation Committee of the Board>

Policy Number: <Policy ID>

Geographic Coverage: <Countries/Regions Covered>

Related Documents:

• Equity Incentive Plan (Master Plan Document) dated <Date>
• RSU Award Agreement (Global) and Country Addenda
• Insider Trading Policy and Trading Window Calendar
• Clawback and Recoupment Policy
• Securities and Disclosure Policy
• Mobility and Tax Equalization Policy
• Equity Accounting Policy (ASC 718/IFRS 2)
• Data Privacy Notice for Equity Participants

Confidentiality: Internal Use Only

Purpose and Objectives

The purpose of the <Company Name> Restricted Stock Unit (RSU) Plans is to deliver market-competitive, performance-aligned long-term incentives that:

• Attract and retain critical talent in alignment with <Company Name>’s strategic objectives
• Foster an ownership mindset and alignment with shareholder interests
• Reward for sustained value creation over time through equity-based compensation
• Support pay-for-performance principles while managing cost, dilution, and risk

Objectives of the policy and administrative guide are to:

• Establish consistent, compliant, and transparent RSU grant and administration practices
• Define eligibility, award sizing methodology, vesting, settlement, and tax treatment
• Clarify governance, approval authorities, and roles and responsibilities
• Provide implementation guidance, country considerations, and communications standards

Scope and Applicability

In Scope

• Time-based RSU awards granted under the <Company Name> Equity Incentive Plan
• Global administration practices across <Country/Region List> supported by <Vendor Name>
• New hire, annual refresh, promotion, retention, and special recognition RSU grants
• Standard vesting schedules, settlement methods, and withholding practices
• Events including termination, retirement, death, disability, leaves of absence, and change in control
• Accounting and financial reporting under ASC 718 and/or IFRS 2
• Securities law, tax withholding, data privacy, and insider trading compliance frameworks

Out of Scope

• Performance Share Units (PSUs) and other performance-vesting equity vehicles (covered in separate document)
• Restricted Stock Awards (RSAs), stock options, and Employee Stock Purchase Plans (ESPP)
• Deferred compensation programs subject to Section 409A, unless explicitly linked to RSU deferrals
• Country-specific prospectus and legal filings (authoritative references in legal addenda)
• Cash-based long-term incentives

Program Principles and Design Philosophy

• Market Competitive: Target grant values align with market median (±<Percentage>) for peer group <Peer Group Description>.
• Performance Aligned: Awards emphasize long-term value creation; vesting encourages retention and sustained performance.
• Simplicity: Time-based RSUs are used as the default vehicle for broad-based equity eligibility.
• Risk-Aware: Controlled dilution, clawback, and trading compliance mitigate risk.
• Global and Local: Globally consistent policy with local addenda for legal and tax compliance.
• Cost-Effective: Predictable expense and burn-rate aligned with budget and shareholder expectations.
• Employee Experience: Clear, timely communications and mobile-friendly administration.

Governance

Roles and Responsibilities

• Board of Directors / Compensation Committee
  • Approves equity plans, annual share reserve requests, LTI strategy, and grant pools
  • Approves CEO and Named Executive Officer (NEO) awards and material policy changes
• Chief Executive Officer
  • Recommends executive leadership awards within approved budget and guidelines
• Chief Human Resources Officer (CHRO) / Head of Total Rewards
  • Owns policy, market competitiveness, administration oversight, and vendor management
  • Proposes annual guidelines, targets, and plan updates to the Committee
• Total Rewards (Equity) Team
  • Designs grant guidelines, calculates award sizing, and oversees grant processing
  • Manages participant communications, country addenda, and tracking of burn/overhang
• Legal/Compliance
  • Supports securities law, country legal review, insider trading, and clawback compliance
• Finance/Accounting
  • Manages ASC 718/IFRS 2 expense, forecasting, and financial planning impacts
• Payroll and Tax
  • Executes tax withholding and reporting; coordinates with equity vendor on settlement
• Equity Administration Vendor <Vendor Name>
  • Provides grant acceptance, vesting, settlement, and participant support platform
• People Leaders
  • Provide input to award recommendations, communicate rationale, and reinforce guidelines
• Employees/Participants
  • Accept awards, comply with trading policies, and manage tax obligations as applicable

Approval Authority and Delegations

• Compensation Committee approval is required for:
  • Annual grant guidelines, share reserve usage, and executive grants
  • Any deviations exceeding ±<Percentage> of guidelines for executives or high-impact roles
• Delegations:
  • CEO may approve awards for non-NEO direct reports within approved budgets
  • Head of Total Rewards may execute individual adjustments within ±<Percentage> of targets for non-executives
  • Equity Team may correct administrative errors without changing grant value, subject to Legal and Accounting review

Review Cycle

• Policy review: annually in <Month> for effectiveness and market alignment
• Guideline refresh: annually in <Month> with external benchmarks and internal affordability
• Country addenda: reviewed semi-annually and upon legal changes

Eligibility

• Eligible Employee Groups
  • Regular employees in <Job Levels/Grades> at <Company Name>
  • Executives and critical talent as designated by <Function/Business Unit>
• Ineligible Groups
  • Interns, contractors, and temporary agency workers
  • Employees covered by collective bargaining agreements unless bargained and approved
• Service Requirements
  • New hires must have a start date on or before <Grant Date Criteria> to be eligible for a new-hire grant
  • Annual refresh eligibility requires continuous service since <Cutoff Date>
• Rehires and Transfers
  • Rehires within <Number> months may be eligible for pro-rated refresh awards
  • Intercompany or international transfers follow Mobility rules and country addenda
• Leave of Absence
  • Eligibility continues during qualifying leaves per Leave policy and local law

Award Types and Features

• Award Vehicle: Time-based RSUs that settle in <Shares/Cash<Percentage>Split> at vest
• Dividend Equivalents (DEUs)
  • RSUs do not carry voting rights or dividends prior to vest
  • If DEUs are provided, they accrue as cash or additional RSUs and vest only upon RSU vesting; unvested DEUs are forfeited upon forfeiture of the underlying RSUs
• Voting Rights
  • No voting rights prior to settlement; rights begin once shares are delivered
• Share Source and Dilution
  • Awards are issued from the <Year> Equity Incentive Plan share reserve
  • Annual burn rate targeted at ≤ <Percentage> of weighted-average shares outstanding
  • Overhang targeted at ≤ <Percentage>; new share requests require Committee approval
• Adjustments
  • Equitable adjustments for stock splits, dividends, recapitalizations as provided in the Plan

Granting Guidelines

Grant Cycle and Timing

• Annual refresh grants typically approved by the Compensation Committee in <Month> and granted on the first trading day following approval, subject to an open trading window
• New hire grants are made on the first trading day of the month following start date or as designated by policy
• Promotions are granted on the first trading day following promotion effective date; if within <Number> days of the annual grant, the promotion award may be combined with or deferred to the annual cycle
• Retention or special grants may be used sparingly for critical retention risks with pre-approval by <Approver Title>
• No grants shall be made during blackout periods or when material nonpublic information is present; grants follow the Insider Trading Policy

Award Sizing Methodology

• Target Grant Values
  • Role-based targets expressed as a percentage of base salary (e.g., <Percentage>% for Grade <Level>, <Percentage>% for Grade <Level>)
  • Market benchmarks from <Survey Source> inform target ranges
• Award Determination
  • Final grant value considers individual performance, criticality, internal equity, location, and budget
  • Award values are converted to RSU quantities using the <20-Day/30-Day> average closing price prior to the grant date or the closing price on the grant date, as approved
• Example
  • If target LTI is <Percentage>% of base salary and base salary is <Amount>, target RSU grant value is <Amount> and RSU count equals <Amount> divided by the applicable share price
• Rounding
  • RSU counts are rounded to the nearest whole unit

New Hire, Promotion, and Retention Grants

• New Hire Grants
  • Sized at <Percentage>% of role-based target or as needed to offset forfeited equity from a prior employer (make-whole)
  • Vesting typically commences on the first vest date following the first anniversary of grant date
• Promotion Grants
  • Sized at the difference between old and new role targets, pro-rated for time since last grant
  • Promotion grants are not a substitute for merit or bonus
• Retention Grants
  • Must document retention risk and business rationale; duration generally <Number> years
  • Subject to Committee approval for awards exceeding <Amount> or off-cycle timing

Vesting and Settlement

Standard Vesting Structures

• Time-based RSUs typically vest over <3/4> years in equal annual installments
• Alternative vesting may include quarterly vesting or a cliff vest followed by periodic installments for certain geographies or roles
• Vest dates generally align to <Day and Month> to simplify administration

Example Standard Schedules

Schedule Name	Total Period	Installments	Typical Use
Standard Annual 3-Year	3 years	33.3% per year	Broad-based
Standard Annual 4-Year	4 years	25% per year	Executives and critical talent
Quarterly over 3 Years	3 years	12.5% per quarter (8 quarters)	Countries favoring more frequent vesting
1-Year Cliff, then Quarterly	4 years	25% at year 1, then equal quarterly installments	Retention-focused roles

Settlement and Tax Withholding

• RSUs settle in <Shares/Cash/Hybrid> on vest, subject to withholding of applicable taxes and social charges
• Withholding methods include net share settlement, sell-to-cover, same-day sale, or cash from employee
• Default method is Net Share Settlement unless otherwise required by country rules
• Payroll coordinates with the equity vendor to ensure timely withholding and reporting

Withholding Method	Description	When Used
Net Share Settlement	Company withholds shares equal to tax liability; remainder delivered to employee	Default in most countries
Sell-to-Cover	Broker sells shares to fund taxes; net shares delivered	When net settlement is restricted or employee elects
Same-Day Sale	All shares sold; net cash delivered after tax	Liquidity preference or restricted markets
Cash Payment	Employee pays taxes in cash; full shares delivered	Limited cases, subject to policy and country rules

Termination and Other Employment Events

• Voluntary Resignation or Termination for Cause
  • All unvested RSUs are forfeited; vested but unsettled awards settle per plan rules
• Involuntary Termination Not for Cause
  • Committee may approve pro-rata vesting based on service, subject to local law and plan discretion
• Retirement
  • Retirement eligibility defined as age >= <Age> with >= <Years> years of service at separation
  • Eligible retirees may receive continued vesting or pro-rata vesting as specified in the award agreement
• Death or Disability
  • Unvested RSUs vest in full upon death or qualifying disability; settlement timing per local law and plan
• Leave of Absence
  • Vesting continues during qualifying paid leaves; unpaid leaves may pause vesting unless required by local law
• Change in Control (CIC)
  • Double-trigger preferred: unvested RSUs accelerate upon a qualifying CIC plus termination without cause or for good reason within <Number> months
  • Single-trigger acceleration is discouraged and requires Committee approval

Mobility and Country Transfers

• Taxation and vesting follow country addenda; sourcing of income across jurisdictions may require apportionment
• Payroll country at vest is generally responsible for withholding unless otherwise required
• Equity Team updates tax residency in the vendor platform upon transfer

Deferrals and 409A Considerations

• Standard RSUs settling at vest are generally not subject to Section 409A
• Any elective deferral of RSU settlement must comply with 409A or local equivalents and requires Legal approval
• RSUs are not eligible for 83(b) elections

Country and Compliance Considerations

• Securities Laws
  • Rely on prospectus exemptions or file required notices in <Country> as needed
  • Provide country-specific employee communications and translations as required
• Tax and Social Insurance
  • Employer and employee tax obligations vary by country; follow approved withholding method per country appendix
  • Where required, gross-up and tax equalization policies must be pre-approved by <Approver Title>
• Data Privacy
  • Process participant personal data in accordance with <GDPR/Local Law> and <Company Name> Privacy Notice
• Exchange Control and Currency
  • Monitor and comply with foreign exchange controls and remittance rules in <Country>
• Cultural and Legal Adaptations
  • Adapt vesting cadence, communications, and consents to local norms where necessary without changing core policy
• Country Addenda
  • Maintain a living repository of country addenda with effective dates and required updates

Accounting and Budgeting

• Fair Value Measurement
  • RSU grant-date fair value is the closing share price on the grant date, adjusted for any non-vested dividend equivalents
• Expense Recognition
  • Recognize compensation expense on a straight-line basis over the requisite service period, net of estimated forfeitures unless policy elects no forfeiture estimate
• Modifications
  • Any change to vesting terms, acceleration, or value triggers modification accounting; consult Accounting before action
• Forfeiture Rates
  • Apply a <Percentage>% initial forfeiture estimate for broad-based awards; update quarterly based on actual experience
• Budgeting
  • Annual LTI budget equals target RSU values for eligible population plus contingency of <Percentage>% for new hires and promotions
• Dilution and Overhang
  • Track burn rate, overhang, and dilution metrics quarterly; target thresholds established in Governance section
• Disclosures and Audits
  • Maintain documentation supporting fair value, expense schedules, and reconciliations for internal and external audit

Administration

• Vendor Platform
  • <Vendor Name> is the system of record for award details, acceptances, vesting, and settlement
• Grant Documentation
  • Each participant receives an RSU Award Agreement and country addendum; acceptance is required within <Number> days
• Insider Trading Compliance
  • Grants, acceptances, and sales must occur only during open trading windows unless an approved 10b5-1 plan exists
• Recordkeeping
  • Maintain grant approvals, award lists, acceptance logs, and settlement confirmations for <Number> years
• Reconciliations
  • Monthly reconciliation between vendor, HRIS, payroll, and general ledger
• Error Corrections
  • Administrative errors may be corrected with Committee notification if impact exceeds <Amount> or affects executives
• Corporate Actions
  • Adjust awards for stock splits, mergers, and other actions per Plan; communicate outcomes to participants
• Security and Access
  • Role-based access controls; separation of duties between data upload, approval, and settlement
• Reporting
  • Standard monthly and quarterly reports on participation, expense, and dilution to <Recipients>

Implementation Guidelines

Implementation Phases

1. Design confirmation: validate eligibility, targets, vesting, and governance with stakeholders
2. Legal and tax review: finalize global terms and country addenda
3. Systems setup: configure <Vendor Name>, HRIS interfaces, and payroll mapping
4. Data preparation: compile eligible list, grant values, and review for accuracy
5. Committee approval: obtain approvals for guidelines and grant lists
6. Communication and training: deliver manager toolkits and employee materials
7. Grant launch: issue grants, enable acceptance, and monitor completion
8. Post-launch controls: reconcile data, track acceptances, and confirm with payroll

Timelines and Milestones

• Target lead time of <Number> weeks from Committee approval to grant launch
• Acceptance window of <Number> days with automated reminders at day <Number> and day <Number>
• First vest communication at least <Number> weeks prior to vest date

Data and Interfaces

• HRIS-to-vendor data fields: legal name, employee ID, email, grade, cost center, work location, tax country
• Payroll integration: tax country, withholding method, and vesting schedules shared monthly
• Access for <Titles> to reports and dashboards via secure single sign-on

Change Management and Training

• Manager enablement sessions covering award rationale and talking points
• Employee webinars with Q&A; recordings and FAQs hosted on <Intranet Link>
• Job aids: how to accept awards, view vesting, and update tax elections

Controls and Risk Mitigation

• Pre-launch checklist for data integrity, trading windows, and approvals
• Post-launch sample testing of acceptances and settlements
• Quarterly control self-assessments and annual internal audit reviews

Risk Management, Clawback, and Ethics

• Clawback
  • Awards and realized gains are subject to recoupment in the event of financial restatement, misconduct, or policy violation per Clawback Policy
• Malus
  • Unvested awards may be reduced or forfeited for material misconduct or violation of restrictive covenants
• Restrictive Covenants
  • Certain awards may require non-compete, non-solicit, and confidentiality agreements subject to local law
• Code of Conduct
  • Participants must comply with <Company Name>’s Code of Conduct and related policies

Review and Approval Process

Annual Policy and Guideline Refresh

1. Total Rewards drafts updates based on market data and internal considerations
2. Legal, Accounting, and HR Business Partners review for compliance and feasibility
3. CHRO approves submission to Compensation Committee
4. Compensation Committee reviews and approves policy and guidelines
5. Total Rewards publishes final documents and updates intranet resources

Award List Approval

1. Managers propose awards within guidelines and budget
2. HR Business Partners review for internal equity
3. Total Rewards validates calculations and aggregates lists
4. Finance confirms budget and expense impacts
5. CEO approves non-NEO awards as delegated
6. Compensation Committee approves executive and any exception awards

Exception Handling

1. Manager submits written rationale for exceptions
2. Total Rewards assesses market alignment and precedent
3. Legal and Accounting review for compliance and accounting impact
4. Committee decision recorded and communicated

Metrics and Reporting

• Participation rate by level and region
• Average grant value vs. target by level
• Forfeiture and acceptance rates
• Burn rate and overhang vs. targets
• Expense vs. budget by quarter and fiscal year
• Retention outcomes for recipients vs. non-recipients
• Diversity and inclusion metrics within equity recipients

Documentation and Records Management

• Store authoritative documents in <System/Repository> with version control
• Retain participant-level records for at least <Number> years post-termination or per legal requirements
• Maintain audit trail of approvals, communications, and system changes

Glossary of Terms and Definitions

Term	Definition
RSU	A grant of a contractual right to receive <Company Name> shares (or cash equivalent) upon vesting and settlement
Grant Date	The date on which the award is granted and fair value is measured
Vesting	The process by which an RSU becomes earned and nonforfeitable over time
Settlement	Delivery of shares or cash upon vest; may occur on the vest date or a specified settlement date
DEU	Dividend equivalent unit that accrues value equal to dividends and vests with the associated RSU
Burn Rate	Total shares granted in a year divided by weighted-average shares outstanding
Overhang	Outstanding awards plus shares available for grant divided by total shares outstanding
Clawback	Company right to recover compensation due to misconduct or financial restatement
10b5-1 Plan	Pre-arranged trading plan that allows trading during blackout periods under certain conditions
Change in Control	A transaction defined in the Plan that may trigger special vesting or settlement rules

Appendices

Appendix A: Sample Role-Based RSU Target Matrix

Job Level	Target LTI as % of Base Pay	Typical Vesting
Grade <Level A>	<Percentage>%	4-year annual installments
Grade <Level B>	<Percentage>%	3-year annual installments
Grade <Level C>	<Percentage>%	Quarterly over 3 years

Appendix B: Example Grant-to-Settle Timeline

1. Committee approves guidelines in <Month>
2. Employee eligibility snapshot captured on <Date>
3. Manager recommendations finalized by <Date>
4. Committee approves grant list on <Date>
5. Grants issued on <Grant Date> with acceptance due by <Date>
6. First vest on <Vest Date> with net settlement as default

Communication Section: Employee and Manager Guide to Your RSU Award

Welcome to ownership at <Company Name>. This guide explains what your Restricted Stock Unit (RSU) award means, how it works, and what you can expect.

What is an RSU? An RSU is a promise to deliver shares of <Company Name> stock to you in the future if you meet certain service conditions. You do not pay to receive RSUs, and you do not own shares until they vest and settle.

Why does <Company Name> grant RSUs? We use RSUs to share in the long-term success of our company. As our stock price grows, the value of your RSUs grows too. RSUs also encourage retention by rewarding continued service.

How does vesting work? Your RSUs typically vest over time. A common schedule is 25% per year over four years or 33.3% per year over three years. Your specific schedule is in your award agreement. On each vest date, a portion of your RSUs becomes yours, subject to tax withholding. After withholding, the remaining shares are delivered to your brokerage account with <Vendor Name>.

What about taxes? When your RSUs vest, the value is considered taxable income. We withhold taxes at vest using the default method for your country. Often, we keep back some shares to cover the taxes (called net share settlement). You may see fewer shares delivered than vested because a portion covered taxes. Your award agreement and local addendum describe your country’s process.

Do RSUs get dividends or voting rights? Before vesting, RSUs do not provide voting rights. If we offer dividend equivalents, they accrue and vest only if your RSUs vest. After settlement, you hold actual shares and have standard shareholder rights.

When will I get my shares? On each vest date, we settle your vested RSUs promptly. You can view your vesting schedule and expected delivery dates by logging into <Vendor Name> and checking your award details.

What happens if I leave <Company Name>? If you resign or are terminated for cause, any unvested RSUs are forfeited. Other situations like retirement, disability, or a company change in control may have different outcomes. Please review your award agreement or talk with HR for details.

How do I accept my award? Accept your RSU award online within <Number> days of the grant date through <Vendor Name>. You’ll review the award agreement and any country terms, then click to accept. If you don’t accept within the deadline, your award may be canceled.

What do I need to do now?

1. Log in to <Vendor Name> to accept your award
2. Review your vesting dates and set calendar reminders
3. Confirm your tax country and personal details are correct
4. Review the Insider Trading Policy and trading window dates

Where can I find help?

• For questions about your award or vesting, contact <HR Contact/Email>
• For tax or payroll questions, contact <Payroll Contact/Email>
• For account access or technical support, contact <Vendor Name> at <Support URL/Phone>

Tips for managers When discussing RSU awards with your team, focus on the long-term value and performance alignment. Explain how award sizes reflect role, market, and individual impact. Encourage employees to accept their awards promptly and to review the Insider Trading Policy before any sale of shares.

Important reminders

• Keep personal and tax information up to date to avoid delays
• Equity values can go up or down with the stock price
• Your award is subject to the terms in your award agreement, the equity plan, and company policies, including clawback and insider trading policies

We appreciate your contribution to <Company Name> and are excited to have you invested in our shared future.

---

Document Information:

• Document Type: Restricted Stock Unit (RSU) Plans
• Category: Variable Compensation
• Generated: August 24, 2025
• Status: Sample Template
• Next Review: <Insert Review Date>

Usage Instructions:

1. Replace all text in angle brackets < > with your company-specific information
2. Review all sections for applicability to your organization
3. Customize content to reflect your company's policies and local regulations
4. Have legal and HR leadership review before implementation
5. Update document header with your company's version control information
6. At bottom of the document you find a short example on how the content could be communicated to end-users, for instance employees.

This sample document is provided for reference only and should be customized to meet your organization's specific needs and local legal requirements.