Your Best Employee Is Being Recruited Right Now — And You May Not Even Know It.
Losing a key employee isn’t just frustrating—it’s expensive. In this episode, Tom Perrone breaks down “phantom equity” (also called phantom stock or ghost stock): a retention strategy that rewards top performers for business growth without handing over real ownership.
You’ll learn how a “Phantom Stock Golden Handcuff” agreement can grant hypothetical shares, tie payout to company value, and deliver cash at a future date or triggering event—creating a strong incentive for key people to stay. Tom also covers design options, tax treatment at distribution, and ways owners can plan for the future payout obligation.
Key takeaways:
· What phantom equity is (and isn’t)—and why it’s different from giving up shares
· How phantom shares are granted, valued, and paid in cash
· Full-Value vs. Appreciation-Only designs and when each fits
· How taxes typically work when benefits are paid out (for owner and employee)
· How to plan for funding the obligation in a tax-efficient way
Want to talk through whether phantom stock fits your situation? Contact Tom Perrone at tperrone@necgginc.com or 203-530-6615.
This episode is designed for closely held business owners—especially companies with roughly 5–50 employees—who want to keep key talent, protect control, and build a simple, flexible incentive plan without ERISA complexity.
What is Building and Protecting Your Business Worth?
“Building and Protecting Your Business Worth Podcast” brings together ideas from successful small business owners, and professionals from many different industries to share strategies and ideas to help create business growth, increased profits, and to protect your business worth from the “What If’s Of Life”.
The podcast will share ideas of how to unlock your “Business DNA”, creating more efficient business decisions, leisure time, and more fun in your business.