Page 733 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

718 The Complete Guide to Executive Compensation

Securities and Exchange Commission (SEC) The independent governmental agency responsible
for ensuring that investors have appropriate information to buy, hold, or sell investment vehicles. As
such it oversees FASB, the stock exchange, mutual funds, and company stock and bond issuance.
securitization The use of securities as an alternative to a loan for financing needs.
security Evidence of ownership in a financial instrument.
security systems Electronic and other devices intended to protect a person at home and the office.
self-appraisal Performance appraisal when the rater and ratee are the same person.
self-directed investment Participant control of investment decisions in their account.
self-insurance When the company or individual agrees to assume risk without paying someone else
to do it.
self-standing SAR See freestanding SAR.
seller’s market High demand and shortage of product permit the seller leeway in increasing prices.
selling against the box See short against the box.
selling short See short selling.
sell-stop order Sale of a stock once price falls below a certain level.
sequential exercise Purchasing stock under option in the order in which the options were granted—
first-in-first out.
SERP See supplementary executive retirement plan.
SERP swap Exchange of all or a portion of a nonqualified supplemental executive retirement plan
(SERP) for a split-dollar insurance policy, with the company paying all or a portion of the premium.
service Period of employment.
service awards Intrinsic or extrinsic award for attaining time-with-the-company milestones (e.g.
5 years, 10 years).
severance pay Payment to an employee at time of company-initiated termination of employment.
shadow plan See phantom stock plan.
share A portion of interest in a company represented by a stock certificate.
share deposit options Additional stock options for those shares deposited with the company for a
stated period of time.
shareholder Individual who owns a share.
shareholder equity Assets minus liabilities.
shareholder equity to sales ratio See investor capital to sales ratio.
shareholder equity to total liabilities See investor capital to total liabilities.
shareholder meeting See annual meeting.
shareholder proposal A formal request by a shareholder that a matter be brought to a vote at the
company’s annual meeting.
shareholder protection formula A formula-driven incentive fund calculation that ensures share-
holders no monies will be paid to executives until certain financial targets have been met and monies
are set aside for the shareholders.
shareholder return Stock price plus dividend (reinvested) less the price of the stock over a stated
period of time.
shareholder rights plans Changes in corporate charter and bylaws intended to prevent unfriendly
takeovers.
shareholder value See market capitalization.