RESTRICTED STOCK AND PERFORMANCE SHARES. Over the last several years, companies have actually embrac

Posted by Rocky Apodaca
2
May 14, 2016
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Why do you get less restricted shares than stock choices? Each restricted stock/RSU grant has full value based upon the stock price, while the value of stock options is technically just a right to purchase stock at your repaired workout cost. The real value of choices depends on the stock's appreciation above the workout rate at some future point. In a grant of limited shares/units, however, the value of each share is readily ascertainable and is much greater than the value of a simple choice. As stock alternatives are harder to value and has to now be expensed by your business when they are approved, companies have actually typically cut back on them. Restricted stock likewise presents less threat to the staff member since, most of the time, stock does not go to zero.
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