Phantom Stock Price

• Category: Corporations - Public - Disclosure and Notices
• State: Multi-State
• Control #: US-CC-24-258
• Format: Word; Rich Text

Description

The Phantom Stock Plan allows eligible employees to receive awards in the form of phantom units, which represent a future payout based on the value of Common Stock without granting actual equity. The plan is administered by a Committee and is available to employees, particularly senior management, regardless of their tenure. Phantom units do not provide equity rights but create an unfunded account valued against the stock price. Vesting occurs at specified milestones such as retirement, death, or disability, or within a maximum of five years after the grant. The payout on vesting is equivalent to the fair market value of the stock on the vesting date, plus cash dividend equivalents and accrued interest. If employment ends before the vesting period, the units are typically forfeited unless due to specific circumstances like retirement or disability. The CEO recommends the award amounts and vesting dates, which the Committee approves, while the Board oversees the total units awarded. Additionally, participants in restricted stock plans may convert their shares into phantom units, aligning vesting dates. This plan is particularly useful for attorneys, partners, and other legal professionals involved in employee compensation structures, as it provides a mechanism for rewarding and retaining key talent while offering clear guidelines on stock valuation and payout processes.