why do companies give out restricted stock 
the use of restricted stocks is pivotal for the compensation and retention strategies of many firms companies use restricted stock for a few reasons first a long vesting schedule encourages employees to stick around for a longer period also the value of restricted stock relies on the company s stock price which can encourage employees to perform better next unlike stock options restricted stocks still retain some value even when the company s stock price declines making them more stable compensation in volatile markets lastly providing restricted stock can be tax efficient for the company and the employee depending on the jurisdiction and the specific restrictions on the stock put in place 