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.