RSUs - Restricted Stock Units

The contributions and impact of employees is key to Shopify’s success. Our RSUs are intended to reward our employees for their impact and contribution as we build Shopify’s success story while reducing some of the downside risks of holding stock options.

An RSU is a promise to provide a number of shares to an employee in the future. Employees are promised a grant of RSUs equal to a certain dollar value. Employees are granted a quantity of shares determined by dividing the promised dollar value by the market price of a Shopify share on the date of grant. At vesting the employee receives shares (no exercise or purchase is required) that they can then retain or sell for the current market price. The value of the shares at the time of vest is based on the stock price at that time, meaning they could be worth more or less than the value at the time of grant. The employment benefit of RSUs is taxable at the time of vesting.

RSU Amount 

RSU grants are promised in dollars (example $5,000 USD) and granted in units.

Vesting
 
RSUs vest over 3 years, beginning on the grant date. 33% (or 1/3) on the 1 year anniversary and quarterly over the following 3 years.

Grant Date

Grants are made at the next available compensation committee meeting (usually once a quarter).

Number of Units

The RSU Amount is divided by the 5-day volume weighted average stock price as at the date of grant to determine the number of RSU’s being granted.
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