phantom stock

These plans often refer to their phantom stock as "performance units."

Phantom stock can, but usually does not, pay dividends.

If there is indeed phantom stock, Pegasus will have difficulty ending the problem.

Phantom stock is essentially a cash bonus plan, although some plans pay out the benefits in the form of shares.

Normally, phantom stock is taxable upon vesting, even if not paid out.

A large part of their income also comes from an employee phantom stock program that links payments to profitability.

For accounting purposes, phantom stock is treated in the same way as deferred cash compensation.

Phantom stock pays a future cash bonus equal to the value of a certain number of shares.

Phantom stock payouts are taxable to the employee as ordinary income and deductible to the company.

As with phantom stock, it's normally paid out in cash, but may be paid in shares.

Phantom stock is favored by closely held or family-owned companies who want to incentivize management and other employees without granting them equity.

Stock appreciation rights (SARs) and phantom stock are very similar plans.

Phantom stock may pay dividends; SARs would not.

Phantom stock and SAR accounting is straightforward.

The National Center of Employee Ownership describes them as being "like phantom stock settled in shares instead of cash"

If phantom stock or SARs are irrevocably promised to employees, it is possible the benefit will become taxable before employees actually receive the funds.

Mr. Wendt: We will start the new company after the shareholder vote with a new incentive system based upon stock options and phantom stock units.

Managers and "other key employees," as well as sharing in the ESOP, will receive the phantom stock units, amounting to 8 percent of the company.

Like other forms of stock-based compensation plans, phantom stock broadly serves to encourage employee retention, and to align the interests of recipients and shareholders.

Similarly, if there is an explicit or implied reduction in compensation to get the phantom stock, there could be securities issues involved, most likely anti-fraud disclosure requirements.

Stock options and similar plans (stock appreciation rights, phantom stock, and restricted stock, primarily) are common in most industrial and some developing countries.

Many private companies now offer phantom stock or other forms of compensation that rise and fall with the company's profit or book value or other previously designated criteria.

Phantom stock grants align employees' motives with owners' motives (that is, profit growth, increased stock prices) without granting employees an actual ownership stake in the company.

Phantom stock provides a cash or stock bonus based on the value of a stated number of shares, to be paid out at the end of a specified period of time.

The company said managers and other "key employees" would be allocated an 8 percent stake in the company, via phantom stock, leaving the ESOP with an effective 52 percent ownership.