From the practice of foreign countries, the design of restricted stock incentive plan is mainly reflected in two aspects: first, the conditions for acquisition; Second, the conditions of sale. But on the whole, the focus is clear, especially the second aspect. And the scheme is designed according to the actual situation of each company, which has certain flexibility.
Acquisition condition
Most foreign companies grant a certain number of shares to the incentive object free of charge or at a nominal fee. However, China's "Administrative Measures for Equity Incentive of Listed Companies (Trial)" clearly stipulates that restricted stocks should stipulate the performance conditions of the stocks awarded to the incentive targets, which means that the design of acquisition conditions can only be limited to the relevant financial data and indicators of listed companies.
Conditions of sale
Foreign programs set market price conditions, life conditions, performance conditions, etc. According to the different requirements and backgrounds of implementing incentive companies. There are few unique terms. However, China clearly stipulates that the lock-up period should be set for restricted shares (the specific lock-up period is stipulated, but other compound selling conditions should be set according to the requirements of listed companies).
The influence of restricted stock incentive plan on stock price
Investors generally look at the fundamentals of a stock and the fundamentals of listed companies. In addition to its operation, they also need to look at the company's stock distribution. Some listed companies will issue restricted shares to employees to motivate them.
Restricted stock incentive plan is one of the main ways of equity incentive plan. Restricted stock incentive plan is to reward managers or employees with restricted stock.
Foreign programs set market price conditions, life conditions, performance conditions, etc. According to the different requirements and backgrounds of implementing incentive companies. There are few unique terms. However, China clearly stipulates that the lock-up period should be set for restricted shares (the specific lock-up period is stipulated, but other compound selling conditions should be set according to the requirements of listed companies).
The number of stock options granted by listed companies to management and employees is quite different from that of restricted stocks, and the number of stock options is much higher than that of restricted stocks, which is also the actual situation abroad. There are some unreasonable loopholes in China's not limiting the total number of objects using these two incentive methods, that is, limiting the threshold of 10%. The prices of these restricted shares are set by listed companies themselves, which has certain moral hazard for some listed companies.
Restricted stock incentive plan should be comprehensively analyzed. In the market, this plan is usually interpreted as a neutral favorable policy, and there is no obvious ups and downs in the specific performance of the stock price.
Everything has its advantages and disadvantages, and the equity incentive system is the guarantee mechanism of listed companies' business objectives, which is conducive to the stable development of the company as a whole. However, if the restrictive measures are too strict and the mechanism cannot play an incentive role, it will have side effects. So good ideas may be difficult to implement or fail to achieve the expected results.
The most important purpose is to motivate and motivate employees or managers to do a good job, so that you can benefit from the rewards given to you. If these conditions are not met, these restricted shares are waste paper. Of course, it also depends on whether the plan is really good, which generally has little impact on the stock. You can also observe whether the stocks that recently announced this plan have any effect. When the market performs well, the stock price is often good news. Of course, due to the short-term stimulus when the market is weak, there will still be a corresponding decline in the later period. This is the case with the stocks in the above picture, that is, this news is a boost and does not play a decisive role.