This plan sets forth: i) that the board of directors will administer the plan; ii) the vesting policy; and iii) how phantom stock benefits will be paid. For example, if employee “A” were to receive 1,000 shares of phantom stock, with each stock worth $20, the current value of the company stock would be $20,000. Phantom Stock Award Agreement means an agreement, certificate, resolution or other type or form of writing or other evidence approved by the Committee that sets forth the terms and conditions of a Performance Stock Award, which Performance Stock Award Agreement may be in an electronic medium, A-2 2014 Proxy Statementmay be limited to notation on the books and records of the … What’s the purpose? Additionally, phantom equity shares do not carry voting rights or similar rights associated with stock ownership. A phantom stock plan, or 'shadow stock' is a form of compensation offered to upper management that confers the benefits of owning company stock without the … Vesting of Phantom Shares. This is one of the reasons that many owners adopt this plan with key employees. An advantage of a phantom equity plan is that, for a company with significant growth in net worth potential, a phantom equity plan provides a cashless alternative for receiving income as the phantom share appreciates in value. A phantom stock plan is a contractual agreement wherein a company promises to make cash payments to employees upon the achievement of certain conditions. Let's say under the terms of the agreement, the employee must stay with the firm for five years to benefit fully from the phantom stock … 2. Just as with stock awards, the purpose of a phantom stock plan is to generate an ownership mentality and reward key employees for helping to grow the business value. It’s important to note that Phantom stock is not real stock in a company. Phantom stock is sometimes more “phantom” than valuation and accounting professionals would like. A phantom stock plan is a type of nonqualified deferred compensation plan. Also known as "shadow" stock, this type of stock plan pays a cash award to an employee that equals a set number or fraction of … Phantom Stock . Small business owners may make phantom stock agreements with key employees, but fail to mention these agreements to their financial advisors, particularly, but not … You are hereby granted pursuant to the Huntsman Corporation Stock Incentive Plan (the "Plan") the above number of Phantom Shares of Huntsman Corporation (the "Company"), subject to the terms and conditions of the Plan and this Agreement. It is a form of deferred compensation that tracks the value of the company but doesn’t give the employee any actual ownership or ownership rights in the company. Phantom Stock Plans in General. Phantom Stock Agreementby Daniel L. Hogans, Groom Law Group, Chartered, with Practical Law Employee Benefits & Executive Compensation Related Content Maintained • USA (National/Federal)A form of phantom stock agreement to be used by a private, closely-held company when granting phantom stock awards to employees under a phantom stock plan. The phantom stock, like stock options or restricted stock, are subject to vesting requirements.