Phantom stock is a contractual agreement between a corporation and recipients of phantom shares that bestow upon the grantee the right to a cash payment at a designated time or in association with a designated event in the future, which payment is to be in an amount tied to the market value of an equivalent number of shares of the corporation's stock. Thus, the amount of the payout will increase as the stock price rises, and decrease if the stock falls, but without the recipient (grantee) actually receiving any stock.
Phantom stock is a contractual agreement between a corporation and recipients of phantom shares that entitle them to a cash payment at a predetermined time or in connection with a specific event, which payment is tied to the market value of an equivalent number of the company's outstanding shares. This arrangement allows the grantee to benefit from potential increases in the stock price without actually receiving any shares.