golden parachute

Definition

A clause in an executive's employment contract specifying that he/she will receive large benefits in the event that the company is acquired and the executive's employment is terminated. These benefits can take the form of severance pay, a bonus, stock options, or a combination thereof.

Use golden parachute in a sentence

You should try and make sure there is a golden parachute clause if you are going to be the head of a company.

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The golden parachute of the new executive provided a lucrative benefit if the big merger and acquisition actually went through.

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When the newly combined company edged my uncle out of the vice presidency, he was set for life thanks to a generous golden parachute from the new board.

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