Over recent years, some of Silicon Valley’s leading private companies attracted staff by offering “restricted stock units” that are triggered when a company has a liquidity event, typically going public. Employees face a personal tax liability when RSUs vest, but staff are unable to sell any of these shares without the company launching a flotation.
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Tech start-ups face dilemma over expiring staff share awards
“There is pent-up pressure among employees who had been promised an IPO in 2021 or ’22, but are now saying ‘RSUs don’t pay my mortgage or my kids’ college fund’,” said Cisco Palao-Ricketts, partner at law firm Goodwin Procter.
