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


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
©2004-2016 Investor Glossary - All rights reserved - Terms of Use