Are some types of payments exempt from the definition of the term parachute payment?
A-5: (a) Yes, the following five types of payments are exempt from the definition of parachute payment — (1) Payments with respect to a small business corporation (described in Q/A-6 of this section); (2) Certain payments with respect to a corporation no stock in which is readily tradeable on an established securities market (or otherwise) (described in Q/A-6 of this section); (3) Payments to or from a qualified plan (described in Q/A-8 of this section); (4) Certain payments made by a corporation undergoing a change in ownership or control that is described in any of the following sections of the Internal Revenue Code: section 501(c) (but only if such organization is subject to an express statutory prohibition against inurement of net earnings to the benefit of any private shareholder or individual, or if the organization is described in section 501(c)(1) or section 501(c)(21)), section 501(d), or section 529, collectively referred to as tax-exempt organizations (described in Q/A-6 of
