Restricted stock grants are generally modeled as an alternative incentive creation device to stock option grants. Given that incentive option grants are not dividend-protected while restricted stock grants carry dividend entitlements, we propose a dual role for restricted stock when granted...

Employing a unique dataset with varying grant sizes and exercise prices, we test the competing optimal option incentive models of Hall and Murphy (2000, 2002) (HM) and Baker and Hall (2004) (BH) which differ with respect to the impact of CEO productivity on incentive determination and also the...

We test the option incentive models of Hall and Murphy (2000, 2002) and Choe (2003). Hall and Murphy (2000, 2002) posit optimal grant size and exercise price contingent on the executive's levels of risk aversion and private diversification. Choe (2003) relates these choices to firm...

We partition takeover bids into two groups: those that are deferred from the date of a toehold purchase, and those that are coincident with a toehold purchase. Coincident bids alone have approximately zero abnormal returns at bid/toehold, but deferred bids have negative abnormals both in the...

We document empirical evidence that bidders tailor their takeover strategy when facing entrenched target managers. Key elements of takeover strategies comprise the toehold investment and the initial bid premium. Intervening variables are the principal outsider and contest parameters. Several...

This paper addresses the question of how target manager entrenchment impacts on bidders' initial takeover strategy, which comprises the toehold and the initial bid premium decisions, modeled as conjoint. We document several empirical regularities. The first is that the toehold alone has no...

This paper provides fresh evidence on CEO stock option awards. We identify several contracting conditions applied either on plan adoption or at subsequent award. We show empirically that option awards cannot be evaluated without controlling for CEO pre-award stock ownership. Although options...

We document a structure of pre-effort conditions associated with ESOPs. Since we can observe shareholder returns at award we infer incentive effects in a setting where premium and discounted executive stock options are regularly awarded. Discounted (premium) awards are associated with the...