The paper examines the motivation and consequences of Golden Parachute (GP) contracts in the context of TBEA, a Chinese company whose GP payment was 1,000 times executive annual salary and which rescinded its GP provision in 2019. We find that for TBEA, whose ownership is dispersed, anti-takeover was the main motivation for the adoption of GPs, and that managerial power was the key factor in designing GPs with payment of high monetary value. We also find that such GPs may induce higher excess executive compensation, lower shareholder participation, and reduce firm value, and that market reaction to the rescinding of GPs is positive. These results show that emerging capital markets should beware of the negative effect of GPs on firm value.