parachute payment
(2) Parachute payment defined (A) In general The term “parachute payment” means any payment in the nature of compensation to (or for the benefit of) a disqualified individual if— (i) such payment is contingent on a change— (I) in the ownership or effective control of the corporation, or (II) in the ownership of a substantial portion of the assets of the corporation, and (ii) the aggregate present value of the payments in the nature of compensation to (or for the benefit of) such individual which are contingent on such change equals or exceeds an amount equal to 3 times the base amount. For purposes of clause (ii), payments not treated as parachute payments under paragraph (4)(A), (5), or (6) shall not be taken into account. (B) Agreements The term “parachute payment” shall also include any payment in the nature of compensation to (or for the benefit of) a disqualified individual if such payment is made pursuant to an agreement which violates any generally enforced securities laws or regulations. In any proceeding involving the issue of whether any payment made to a disqualified individual is a parachute payment on account of a violation of any generally enforced securities laws or regulations, the burden of proof with respect to establishing the occurrence of a violation of such a law or regulation shall be upon the Secretary. (C) Treatment of certain agreements entered into within 1 year before change of ownership For purposes of subparagraph (A)(i), any payment pursuant to— (i) an agreement entered into within 1 year before the change described in subparagraph (A)(i), or (ii) an amendment made within such 1-year period of a previous agreement, shall be presumed to be contingent on such change unless the contrary is established by clear and convincing evidence.