Which term refers to a substantial severance payment guaranteed to an executive if the company is acquired?

Which term refers to a substantial severance payment guaranteed to an executive if the company is acquired?

• A. Golden goose
• B. Golden fleece
• C. Golden parachute
• D. Golden handshake

Answer: (C)

In corporate takeovers, a golden parachute is a large severance package guaranteed to an executive if the company is acquired or undergoes a change in control. This arrangement provides financial security for the leader and helps ensure a smooth transition, aligning the executive’s interests with the deal’s success and reducing resistance to the takeover. The other terms describe different ideas: a golden handshake is an exit package not specifically tied to an acquisition, a golden fleece is a mythical lure, and a golden goose denotes a valuable ongoing income source rather than a one-time severance triggered by a change in control.

In corporate takeovers, a golden parachute is a large severance package guaranteed to an executive if the company is acquired or undergoes a change in control. This arrangement provides financial security for the leader and helps ensure a smooth transition, aligning the executive’s interests with the deal’s success and reducing resistance to the takeover. The other terms describe different ideas: a golden handshake is an exit package not specifically tied to an acquisition, a golden fleece is a mythical lure, and a golden goose denotes a valuable ongoing income source rather than a one-time severance triggered by a change in control.