This guide is for company administrators who need to process RSU settlements in Pulley. If you're looking to understand RSU basics, start with Understanding RSUs: A Simple Guide to Restricted Stock Units.
How do I settle RSUs?
After logging on to your Pulley account:
Select Cap Table on the left navigation
On this screen you can toggle between each security type. Select RSUs.
Select Actions > Settle RSUs
Step 1: Choose Settlement Type
Option 1: Settle Vested RSUs
Use this option for: Processing settlements as they happen. Continue below.
Option 2: Record Past RSU Settlements
Use this option for: Historical settlement already completed.
Step 2: Select Settlement Date
Choose your settlement date. This determines which vested, unsettled RSUs will be eligible to settle in step 4.
Important: Ensure there is a Fair Market Value (FMV) in effect on the settlement date. Pulley needs this to calculate the value of the RSUs being settled in later steps.
Step 3: Check Double-Trigger Provisions
If Pulley detects double-trigger RSUs on your cap table:
Mark which milestone conditions have been met (IPO, acquisition, etc.) by selecting Edit
Only RSUs with satisfied milestone conditions will be eligible for settlement in step 4
If no double-trigger RSUs exist, this step is skipped
Step 4: Select Eligible RSUs to Settle
Pulley displays all RSUs eligible for settlement in a table. For each RSU grant:
Select which RSUs to settle: All RSUs are automatically selected. Uncheck the box next to each grant you want to exclude
Adjust settlement quantity: The available amount is pre-filled, but you can enter a smaller number if you don't want to settle all available RSUs
Step 5: Choose Tax Withholding Method
Select how you want to handle tax obligations for the settlement:
Option 1: Withhold RSUs to Cover Tax Liability
Pulley automatically withholds RSUs from the stakeholder to cover the tax liability
The company pays taxes on the stakeholder's behalf
Stakeholder receives fewer shares upon settlement
Option 2: Handle Taxes Off Pulley
No RSUs are withheld from the stakeholder
Company receives cash payment off Pulley to cover tax liability
Stakeholder receives all shares upon settlement
Skip to Step 9 below
Step 6: Calculate and Review Taxes Due
Default Tax Rate
Pulley automatically calculates taxes due for each stakeholder using:
Stakeholder-level "Tax Withholding Rate" (if previously set)
IRS minimums (if no Tax Withholding rate is set):
22% for settlements under $1 million
37% for settlements over $1 million
Review and Adjust Taxes Due
Review taxes due for each stakeholder. If settling multiple RSU grants for one stakeholder, their values are aggregated for tax calculation purposes.
You can adjust the taxes due by:
Entering taxes due directly into table: Pulley calculates the implied tax rate and RSUs to withhold
Entering tax rate directly into table: Pulley calculates the implied taxes due and RSUs to withhold
Uploading taxes due from payroll provider: Import exact amount of taxes due
Download tax withholding report: Generate a detailed report showing how RSUs to be withheld for each stakeholder were calculated from taxes due.
Step 7: Select Withheld RSU Treatment
Select whether RSUs withheld to cover tax liability should be returned to the option pool or retired for each equity plan. This setting should align with the terms specified in your equity plan documents.
Note: This setting only appears during your first RSU settlement. Once configured, future settlements will automatically use the same setting.
Step 8: Review RSU Settlements
In this step, Pulley has allocated the RSUs to be withheld for each stakeholder in Step 6 across all their RSU grants being settled. Review the final allocation results:
Single RSU grant per stakeholder: All withheld RSUs calculated in Step 6 allocated to one grant
Multiple RSU grants per stakeholder: All withheld RSUs calculated in Step 6 allocated proportionally across grants
Allocation example (multiple grants):
Stakeholder has 25.5% tax rate and it was determined that 77 RSUs should be withheld to cover the stakeholder's tax liability (from Step 6)
Step 1: RSU Grant 1 (smaller grant): 100 RSUs × $1.00 FMV = $100.00 value → $25.50 taxes due → 25.5 RSUs to withhold → rounded down to 25 RSUs withheld
Step 2: RSU Grant 2 (larger grant): 200 RSUs × $1.00 FMV = $200.00 value → gets remainder (77 - 25) = 52 RSUs withheld
Total: 77 RSUs withheld (matches Step 6 exactly)
Download RSU Settlement Report: Generate a detailed excel report showing all settlement details before proceeding.
Step 9: Settle RSUs
Complete the RSU settlement process:
Settlement Actions
RSUs settle and shares are issued: Settled RSUs convert to actual company shares
Withheld RSUs are processed: RSUs withheld for taxes are either retired or returned to the equity plan, depending on the plan configuration (set in Step 7)
Documentation
Certificates sent: Settlement certificates are generated and sent to both the company signatory and stakeholder for acceptance
Email preview: You can preview the email that will be sent to stakeholders before finalizing the settlement