A Parachute Payment is a payment or benefit triggered by a change in control of a company, often tied to executive employment agreements and sometimes subject to special tax rules (e.g., U.S. golden parachute excise tax considerations under Section 280G). In M&A, Parachute Payment calculations can affect deal economics and closing deliverables, and Parachute Payment mitigation strategies may include cutbacks, shareholder approval, or restructuring compensation.
