What happens to unvested RSU when you leave a company?

Generally, leaving the company before the vesting date of restricted stock or RSUs causes the forfeiture of shares that have not vested. Additionally, with certain types of termination (e.g. disability or retirement), your stock plan may continue the vesting and even accelerate it.

Can you sell unvested RSU?

In most scenarios when your RSUs vest you can sell them immediately and there is almost no tax impact. However, there is a special time in a company’s life where this is not true. However, if the stock reverts to the original IPO/Vesting date price, don’t hesitate to sell since there will be no additional tax benefit.

What happens to RSUs when a company is sold?

In the event of a company sale of all or substantially all of the company’s assets, the purchase price will be paid directly to the company and the company would then have to distribute the proceeds to its equity owners. The RSUs are owned by the holder, regardless of vesting.

What is unvested RSU?

Unvested RSU means each restricted Share unit granted by the Company under the EPIP on or prior to the Closing Date that has not become vested on or prior to the Closing Date in accordance with the terms thereof; each such unit gives its holder the right to receive a number of Shares set forth therein upon vesting.

Should I sell RSUs to diversify?

It’s still a wise choice to sell all of them even if the stock price ends up rising, because you are protecting your wealth from undue risk. If you want to use the funds for investments, reinvest in a diversified portfolio. This allows you to still participate in market growth with a heck of a lot less downside risk.

Is unvested restricted stock considered outstanding?

Shares of unvested restricted stock are excluded from our calculation of basic weighted average shares outstanding, but their dilutive impact is added back in the calculation of diluted weighted average shares outstanding.