LTI Grant?

[nzwasp]

I have these RSU things vesting and I can see the vest estimated amount for the next three years.



This is a snippet of this years. How do they figure out the grant price? for example this is RSU from 2017 that vests this year and the current share price for the company is $12 something. I think i really want to know how they figure out the vest price.

[ExtraSlow]

Usually Grant price is set when you get the grant. Either the average of that period, or the closing price at the end of the period.

[tenth]

Grant price would be set at the grant date, and likely a volume weighted price average based on 5-30 trading days leading up to the grant date.

The estimated benefit above would likely based on the latest closing price available. It will ultimately likely vest and payout based on a 5-30 day volume weighted average up to the vesting date.

[spike98]

Most places i have worked for take the 21 day average over the end of the calendar year for a vesting price.

[killramos]

They should have told you what the basis for the price was when you issued you the RSU’s

[nzwasp]

So on the company intranet it says $12.15. So I would think it would be approx 1400 x 12.15 and that’s the value. I don’t know how Grant price affects the vest price though if it affects it at all. Now I also have PSU’s except the company cancelled the previous 2 years (2017 and 2018) psu because of poor company performance. The psu grant price has always been 0$. I do have psu granted last year however it says that they come due in 2022. I don’t know how the psu vest price works either.

[ExtraSlow]

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So on the company intranet it says $12.15. So I would think it would be approx 1400 x 12.15 and that’s the value. I don’t know how Grant price affects the vest price though if it affects it at all. Now I also have PSU’s except the company cancelled the previous 2 years (2017 and 2018) psu because of poor company performance. The psu grant price has always been 0$. I do have psu granted last year however it says that they come due in 2022. I don’t know how the psu vest price works either.

You work for a really large company. I'm certain documentation for all this is available from your HR department. You should be getting clear direction on grant price every time you get a grant.

[killramos]

Yea this isn’t really a beyond question. More of a lunch and learn question.

[gqmw]

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So on the company intranet it says $12.15. So I would think it would be approx 1400 x 12.15 and that’s the value. I don’t know how Grant price affects the vest price though if it affects it at all. Now I also have PSU’s except the company cancelled the previous 2 years (2017 and 2018) psu because of poor company performance. The psu grant price has always been 0$. I do have psu granted last year however it says that they come due in 2022. I don’t know how the psu vest price works either.

Grant price does not affect vesting price.

Grant price is just to determine the number of units to award - for example, if you were entitled to an LTI award of $10k and the share price at grant is $10, you would get 1,000 units. As previously mentioned by others, the grant price is typically based on a 5-20 day average (as opposed to just close price) to smooth out any volatility.

At vesting, your payout will be the (1,000 units + dividends reinvested) x price at vesting.

PSUs are performance contingent, but they work the exact same way. Only difference is that at the end of the performance period, there is a performance multiplier that is applied. So the payout would be: (1,000 units + dividends reinvested) x price at vesting x performance multiplier.

[nzwasp]

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Grant price does not affect vesting price.

Grant price is just to determine the number of units to award - for example, if you were entitled to an LTI award of $10k and the share price at grant is $10, you would get 1,000 units. As previously mentioned by others, the grant price is typically based on a 5-20 day average (as opposed to just close price) to smooth out any volatility.

At vesting, your payout will be the (1,000 units + dividends reinvested) x price at vesting.

PSUs are performance contingent, but they work the exact same way. Only difference is that at the end of the performance period, there is a performance multiplier that is applied. So the payout would be: (1,000 units + dividends reinvested) x price at vesting x performance multiplier.

thanks this is very informative.

I did go through the company info on it but it is very confusing.

[ExtraSlow]

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thanks this is very informative.

I did go through the company info on it but it is very confusing.

probably don't want to post anything too detailed on a public forum, but if you want me to go through it privately, I can. You should have a document explaining the plan details, and you should have a single-page kind of thing showing the details from each year. Or just a webpage that shows all the years.

[Disoblige]

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I did go through the company info on it but it is very confusing.

A simple chat with HR on the phone would be beneficial too. They should be very familiar with it and it's essentially part of their job to help you out with things like this.

[riander5]

This is the answer -
Your grant price determines how many shares you get. Is your LTIP target 10% of wage? If you make 100k, they will issue you 10k worth of stock at 14.95 giving you 668 units

As you LTIP vests, which I will assume is 1/3 1/3 1/3 at year 1 2 and 3 from grant date as alot of companies do, each year when they vest you can pull them out for whatever the stock is worth. So at year one you can pull out 1/3 of your grant which will be about 222 units. If your share price grows, congrats you get more money. If it sinks, well that sucks you lost money.

Just think of it as if you have X$ of a stock, but you can't touch it for a certain period.

Also - when it does vest, ask yourself this question every time - if you had this money given to you, would you invest in your company? If the answer is no pull it out and invest it elsewhere.

[Neil4Speed]

Joined this tread too late... the one thing I can actually help with as its what I do for a living!

You guys have the right idea though.

[cyra1ax]

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I have these RSU things vesting and I can see the vest estimated amount for the next three years.



This is a snippet of this years. How do they figure out the grant price? for example this is RSU from 2017 that vests this year and the current share price for the company is $12 something. I think i really want to know how they figure out the vest price.

If you expand the section that pertains to LTI's in the big banner article that came out earlier this week, you'll see that it tells you what the vest price is for this tranche($13.15) and how they got that number. There's also related PSU information too.