Page 679 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

664 The Complete Guide to Executive Compensation

bonus guarantee A promise to pay not less than a stated amount. Typically, part of an employment
contract.
bonus (transaction) See transaction bonus.
book entry form Electronic credit of stock owned.
book reserve A balance sheet liability to cover a recognized financial obligation.
book value Shareholder equity, sometimes called the break-up-value of the company.
book value increase Increase in either dollars or percentage over the previous year of book value.
book value plan An incentive plan that uses book value for awards, appreciation units, and/or options.
book value share price Shareholder equity divided by the average number of common shares of
stock outstanding during the year.
book value share price to stock price ratio Book value share price divided by market price of the
common stock.
book value to earnings ratio Book value share price divided by the earnings per share.
boomerang executive Re-employment of retired executive to replace person that took the
person’s job.
borrowing on margin See margin borrowing.
bottom fishing Purchasing shares in a declining market in hopes of a market rally and a profit.
bottom-up Recommendations from the bottom of the organization flow up to the top.
breakable maximum A maximum plan payout that can be exceeded and paid given certain conditions
(e.g., achieving at least the target award the following year).
bridge financing A loan the organization expects to pay from later (and probably larger) loan
undertakings.
bridge loan A loan to cover a new purchase before sale of existing property.
broad-banding The reduction of pay grades with the remaining grades having a greater range
(between minimum and maximum) to place less emphasis on promotions (vertical movement) and more
on career development (lateral movement).
broad-based stock option plan A plan where most, if not all, employees receive an option to buy
shares of company stock. See stock option.
broker The individual who brings together a buyer and seller for a fee. Examples include stock-
brokers and real estate brokers.
brokerage account An account with a broker.
brokerage fee A transaction charge from a broker.
broker (discount) A broker who charges a lower commission because of providing few services.
bronze parachute A severance payment less generous than a golden parachute but more generous
than a tin parachute.
bubble economy A sector expected to soon burst because of unsustainable growth.
bucket shop Brokerage firm that disappears with customer money.
budget A defined amount of money to be set aside for a particular type of expenditure.
bull Person who buys securities anticipating a rise in prices.
bull market A stock market with rising stock prices.
bullet dodging Granting stock options after stock price has been driven down by bad news.
Bureau of Labor Statistics Federal agency that publishes the Consumer Price Index and data in a
range of areas.