What does restricted stock repurchase and cancellation mean?

The repurchase and cancellation of restricted stocks is an equity and option reward mechanism for listed companies. Listed companies can implement equity or option incentives for company employees with the approval of the China Securities Regulatory Commission. If the employees who received the incentives leave, However, equity and option incentives have not yet been implemented, so the corresponding shares of the resigning personnel will be written off accordingly. The company will repurchase the canceled shares as "treasury shares", that is, retain them, and will no longer participate in stock issuance, nor participate in the calculation and distribution of expected returns on shares. Repurchasing canceled shares can also be used to convert bonds, become employee benefits, or be sold when the company needs it. The role of stock buyback itself is for listed companies to maintain the company's value, stabilize the stock price, or even increase the stock price.

Stocks are part of the ownership of a joint-stock company and are also issued ownership certificates. They are a type of securities issued by a joint-stock company to each shareholder as a shareholding certificate in order to raise funds and obtain dividends and bonuses. Stocks are long-term credit instruments in the capital market that can be transferred, bought and sold. Shareholders can share the company's profits with them, but they also have to bear the risks caused by the company's operational errors. Each share of stock represents a shareholder's ownership of a basic unit of the business. Every public company issues shares.

Each share of the same class of shares represents equal ownership of the company. The size of each shareholder's share of the company's ownership depends on the number of shares he or she holds relative to the company's total equity.

Stocks are a component of the capital of a joint-stock company and can be transferred and bought and sold. They are the main long-term credit instrument in the capital market, but the company cannot be required to return its capital contribution.

(1) Stocks are an effective means for companies to raise funds. This is the original function of stocks. By issuing stocks, listed companies can fully absorb idle funds from investors and convert them into their own operating capital.

(2) Stocks are a way for enterprises to diversify their own risks. No matter what type of enterprise it is, there will always be operational risks. When the sponsors are difficult or unwilling to bear the risks they face, they There are always ways to transfer or share risks with others, and forming a joint-stock company by issuing shares is a good way to spread investment risks.

(3) Increase the value of entrepreneurial capital by issuing stocks. When a company with excellent performance issues stocks, its issue price will be much higher than its net assets per share. The premium issuance of stocks makes The entrepreneurial capital of the promoters of the joint-stock company is increased in value.

(4) The issuance and listing of stocks play an advertising role. When a company goes public and issues stocks, it will naturally enter the eyes of investors. Listing is often a guarantee of quality, and it is also a guarantee for ordinary customers. More attractive.

In addition, the stock market also plays a significant role in national economic construction. It not only ensures the smooth implementation of enterprise restructuring, but also enhances the development momentum of enterprises. It can also increase tax revenue and strengthen the national economic strength. Because of these many reasons, the stock market in our country and even in the world is developing rapidly.