golden parachute business definition

Case Study After six years at the helm of Atlanta-based The Home Depot, CEO Robert Nardelli abruptly resigned in January 2007 with a $210 million golden parachute. The former General Electric executive had instituted a top-down management style that helped produce higher revenues and profits at The Home Depot, but a stagnant stock price. Unhappy stockholders felt that Nardelli's lucrative compensation (he received over $30 million in compensation and stock options the previous year) was overly generous in view the stock's poor performance. They were also angered by Nardelli's actions during the firm's spring annual meeting when he had been unwilling to answer shareholder questions. He was the only member of the board of directors who had bothered to attend the meeting. The outsized golden parachute was comprised of $20 million in cash, $44 million in previously earned and vested deferred stock, $32 million of retirement benefits, acceleration of unvested stock options valued at $77 million, plus additional benefits. The price of The Home Depot common stock increased 91¢ per share on the day the resignation was announced.