Greenmail Gain

Greenmail Gain means:
the amount paid by a corporation in a direct or indirect redemption of its stock from a stockholder who has held this stock for less than 2 years if, during such period, the shareholder made or threatened to make a public tender offer for stock of the target corporation. On a hostile takeover, there is a 50% nondeductible excise tax on this greenmail gain. Former IRC (check if this IRC provision is current here) §5881(b).

See Excise and Excise.