A Golden Parachute Is a Prearranged Contract with Managers Specifying

question 30

True/False

A golden parachute is a prearranged contract with managers specifying that,in the event of a hostile takeover,the target company managers will be paid a significant severance package.

---

Definitions:

Consideration

in contract law, refers to something of value given by both parties to a contract that induces them to enter into the agreement to exchange mutual performances.

Merchant

An individual or company engaged in the business of buying and selling goods or services with the intent of making a profit.

Insanity

A mental disorder so severe that it prevents someone from having legal capacity or from being held responsible for their actions, often used as a defense in criminal trials.

Legal Effect

The consequences that a law or legal action imposes on the rights, status, or obligations of the parties involved.