I've heard of an interesting "equity" scheme in a company from my friends and I'm wondering what this scheme is called.
You work as the Manager for a supermarket chain, and they will give you 5% of annual profits per year. But you do not have 5% equity of the company, as when you leave, you can't take the 5% equity with you and sell it. It goes to the next Manager. This serves as a way to incentivize CEO performance without diluting the share ownership when the Manager leaves.
What is this kind of scheme called and is it common?
