How it works

Ratable Vested treats vesting as a continuous line between vest events rather than a step function. Between any two consecutive vests, the community's allocation ramps linearly from the prior cumulative total to the next. At each vest date, the ratable and actual-vested values are equal; between them, ratable accumulates shares that haven't technically vested yet but are presumed to be accruing.

Formula

Respecting Employer Intent

Employers choose their vesting schedules deliberately. A front-loaded schedule is designed to deliver more compensation early; a cliff vest is designed to reward retention past a milestone. Ratable Vested preserves that intent — it bridges the gaps between vest events without altering the shape of the employer's chosen schedule. Compare the same method applied to three different vesting patterns, all of which deliver 480 total shares over 4 years:

Notice how Ratable Vested always passes through each vest event (touching the yellow step function at every corner), but smooths the gaps between them. The shape of the curve reflects the employer's chosen schedule — if they front-loaded the grant, that's what the community property allocation looks like too. Other time-rule methods (like Nelson) impose their own curve shape regardless of how the employer structured the grant.

In practice

Ratable Vested is not a method drawn from case law. It is included as an analytical tool — a middle ground between the binary Vested Shares method and the longer-period Nelson time rules. It smooths the cliff behavior of actual vesting without reaching back to the grant date, producing a curve that closely tracks the vesting schedule while eliminating the sharp steps. Comparing it against the established methods can help illustrate how much of the spread comes from the time-rule denominator choice vs. the vesting shape.