Limited Liability Company The Management Of Virtual Stock Option Incentive Plan

In Western countries, as an effective medium and long-term incentive mechanism, Stock options has been recognized and widely used. The development of Stock option system brought the modern enterprises in which the ownership and operating rights are separation to solve the problems which were brought about by the "moral hazard" and "adverse selection". However, in practice, stock option plans are used in most listed companies, while because of various internal and external obstacles, a dominant non-listed limited liability company can not easily use the stock options which long-term incentive tools as the same as listed companiesHow to solve the bottlenecks which were encountered when use the incentive stock options, for the management of the limited liability company? On the basis of thorough analysis the concept of the Phantom stock options, theoretical basis, stimulating and comparison of the Chinese and the foreign applications, this paper explains the need of the implementation of Phantom stock options, which was based on the nature of the work for the operation and management in the company. And though a detailed analysis and research, this paper explains the feasibility of the implementation of Phantom stock options for the operation and management of the limited liability company; which was from both the mechanism of the stock option plans and how to overcome the obstacles. In a word, this paper thinks that the Phantom stock option plans fit with the Chinese national conditions, and also is an incentive tool which is suitable for the management of the non-listed liability company.In order to make the Phantom stock option plan be more feasibility and operability, this paper also used a limited liability company for example, and designed a Phantom stock option to the specific operation, and made a analysis to the implementation of process of the enterprise Phantom stock option, and described many problems, such as how to extraction the incentive funds, how to determination the Phantom stock price, how much Phantom stock should be given, and the other issues related to the management. Finally, this paper also listed many problems which should be paid attention when the management design the Phantom stock option and implement ate the plan.The main conclusions in the following:(1) After making an analysis of the mechanism incentive stock options, this paper come to the conclusions that Phantom stock option is long-term effective. And basis the conclusions, considering the nature work of the management and the characteristics of the limited liability company, this paper also come to another conclusion that incentive stock option is an effective long-term incentive program ,and this incentive stock option is not only fitting with our natural conditions, but also fitting with the management of the non-listed limited liability company.(2) At present, our country has no success case for implementing the Phantom stock option in the limited liability, and our country has poor research results about it, while this paper combined with the actual situation of an enterprise to design the implementation of the Phantom stock option program. This paper analysis the implementation process, at the same time analysis the technical elements; this paper also research and design how to distribution extraction methods and ratio of the incentive funds, this paper also design how to determine the within price of the Phantom stock ;this paper also design how to exercise their rights of the Phantom stock options.(3) After carrying out the actual calculation to the EVA method, which was highly respected in the theoretical circles, this paper found that the differences in theory and in practice, at last this paper gives some recommendations to improve this problem.