In general, only selected employees are selected to get Phantom Stock, for example.B. Phantom share plans are deferred compensation agreements that distinguish employees based on the value of the company`s stock. The price, since it is not a real stock, does not give employees property rights over the company. 3. Payment/certificates. With respect to the compliance of phantom shares, subject to paragraph 6, the company must: (a) issue a certificate or certificate of common shares on your behalf without a caption (except for a legend required by applicable securities laws or any other agreement in which you participate); (b) to charge you an amount equal to the fair value of the shares that would otherwise be issued to you; or (c) pay and issue a combination of cash and shares that, combined with the fair value of shares that would otherwise be issued to you; in any event, in the event of derito cancellation of ghost actions that have hay; However, if this payment or issuance of shares cannot take place before the first day, this payment is not subject to the additional tax levied in section 409A of the code. As a general rule, payment of benefits is deferred until a given date, which is usually related to an exit or other form of liquidity event. The shares of phantom shares are valued, and the payment follows, either as a package or as a certain number of payments over a given period. In their most common form, an employee who holds phantom shares is paid by the company for those shares from a sale of the company. The value of a Phantom unit of shares is measured on the basis of the value of the company`s shares and fluctuates relative to the change in the value of the business.
This value can be determined by a formula, calculated or determined by an assessment. The value is subject to such adaptations. B as shareholder investments and dividends paid to shareholders. In other words, the employee does not receive equity in the company, does not become a shareholder, does not acquire rights as a shareholder (to participate in meetings or inspects books) and has no ties to the company, but receives a cash payment in accordance with the terms of the plan and the value of the company`s shares. Ghost shares are a contractual agreement between a company and the beneficiary of phantom shares that give the beneficiary the right to pay in cash at a given time or in connection with a particular event in the future, the payment of which must be made in an amount related to the market value of an equivalent number of shares of the company.  Thus, the amount of the payment will increase as the share price rises and decreases when the stock falls without the recipient (beneficiary) actually receiving a stock. Like other forms of stock-based compensation plans, Phantom Stock is generally used to coordinate the interests of beneficiaries and shareholders, contribute to the value of the shares, and encourage the retention or participation of contributors.  Recipients (destiners) are usually collaborators, but may also be directors, third parties or others. An employer enters into an agreement with a number of employees.
In accordance with the provisions of the plan, the employer grants workers a certain number of phantom units or actions.