Restricted stock, also known as restricted securities, is stock of a company that

is not fully transferable (from the stock-issuing company to the person receiving
the stock award) until certain conditions (restrictions) have been met. Upon
satisfaction of those conditions, the stock is no longer restricted, and becomes
transferable to the person holding the award. Restricted stock is often used as a
form of employee compensation, in which case it typically becomes transferable
("vests") upon the satisfaction of certain conditions, such as continued employment
for a period of time or the achievement of particular product-development
milestones, earnings per share goals or other financial targets. Restricted stock
is a popular alternative to stock options, particularly for executives, due to
favorable accounting rules and income tax treatment.[1][2]