TLDR:
An RSPA is a legal contract used when issuing restricted stock to founders or employees, defining the purchase terms, vesting schedule, and the company’s right to repurchase unvested shares upon termination.
RSPA vs. Option Grant — Tax and Control
Founders typically receive their equity through restricted stock purchase agreements rather than options because purchasing stock (even at minimal cost) creates better tax outcomes than options. When a founder buys restricted stock at fair market value at founding (when it’s essentially zero), there is no taxable income and the capital gains holding period begins immediately — enabling long-term capital gains treatment on the full appreciation. Options, by contrast, create an AMT event at exercise and ordinary income if exercised above the 83(b) election window.