Page 715 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

700 The Complete Guide to Executive Compensation

mezzanine capital Subordinated debt, preferred stock, or any other hybrid security that ranks
junior to bank debt but senior to common equity in the capital structure.
micro-cap stock Market capitalization of less than $100 million.
mid-cap stock Market capitalization of over $1 billion but less than $10 billion.
midcareer crisis Belief around age 40 that no future promotional opportunities exist.
midpoint The point midway between the minimum and maximum of a range.
milestone awards Payments given for meeting predetermined targets on schedule.
milestones Identifiable key-event completions in a multievent project.
minimum option value method Determination of present values by discounting the current market
value of the stock price using risk-free rate of return for the full period of the option’s term as well as
the expected dividends over the same period (discounted in the same manner).
minimum premium arrangement Company agreement to deposit in bank funds sufficient to cover
normal claims experience in exchange for reducing the amount of insurance (and related premiums).
minimum value model An option pricing formula that calculates the present value by discounting
the current fair market value of the stock and its dividends. Essentially, it is the Black-Scholes model
with zero volatility.
mirror plan A nonqualified plan with the same features as a qualified plan except that they begin
where the latter ends.
mission See mission statement.
mission statement Description of what the organization does in support of its vision statement.
mode Most frequent value.
modified dead hand When only those directors in place at time of a hostile bid could vote.
modified single-trigger contract Provides severance benefits for a voluntary termination (typically
within 30 days after a one-year anniversary of the defined change of control).
modular plan A choice of packages rather than individual coverage levels under a flexible benefit
program.
monetize To convert illiquid assets into cash.
money market Portion of securities market that includes commercial paper and other short-term
investments.
money market fund A mutual fund that invests in commercial paper and other short-term
investments.
money purchase plan A defined-contribution pension plan funded by a preset formula.
money supply Money in circulation.
Monte Carlo simulation Mathematical technique that tests uncertain variables for random results
to determine the most likely outcome.
Moody’s Investor Services A company that gives ratings to corporation debt issues.
mortgage A secured debt on the property acquired using lender’s funds.
mortgagee The lender of mortgage funds.
mortgagor The recipient of mortgage funds.
mortgaged-backed securities Bonds typically backed by pooled mortgages.
motivation The stimulus to achieve a stated objective.
multifactor analysis See factor analysis.
multiple approach See exercise cost method.