Investor Glossary-golden handcuffsInvestor Glossary-golden handcuffsInvestor Glossary-golden handcuffsInvestor Glossary-golden handcuffsInsightful stock market charts - Click here
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Golden Handcuffs

The HTML to link to this page

Golden handcuffs are various incentives offered to key executives to make sure they don't leave the company. Golden handcuffs can take several forms. For example, golden handcuffs may entail deferred compensation, under which pay for past services are postponed to some future date. Golden handcuffs can also involve stock options, which the executive cannot exercise until after some length of service to the firm. Another form of golden handcuffs is restricted stock, which is transferred to the executive but remains subject to forfeiture if the manager leaves the firm at an early date, or does not reach certain performance goals. Note that golden handcuffs are also sometimes part of an anti-takeover strategy adopted in mergers and acquisitions. Under this golden handcuffs scenario, key staff immediately become vested in stock options once the company is taken over. With their golden handcuffs thus removed, many key executives will want to quit the firm, leaving the new owners without the experienced talent they need to run the company. This unlocking of golden handcuffs serves as a poison pill to discourage takeover attempts.

Rate this golden handcuffs definition...

Learn about investing with the Investor Glossary Term of the Day

Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.

Popular Terms: option premium, command economy, retained earnings, deferred revenue, risk management, 401a, dividends payable, 1031 exchange, Zero Cost Collar, annual return, covered put, per diem, 144a, APR, liquidity ratio, FTSE, current ratio, average price per share, reverse mortgage, real GDP, limit order, stock market close, stock split, wholly-owned subsidiary, deferred tax, in escrow, labor relations, required rate of return, debt service coverage, FICO score, implied volatility, EBITDA, quality assurance, cancelled check, minority interest, margin rate, balance sheet, ex-dividend, class C shares, irrevocable trust, open position, 1035 exchange, phantom income, ex-dividend date, inflation, diluted share, VIX, Key Rate Duration, LIBOR

Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2015 Investor Glossary - All rights reserved - Terms of Use