Clawback

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Clawback

A dividend clawback is an arrangement whereby the equity owners commit to use dividends they have received in the past to finance the cash needs of the project or corporation in the future. Clawback has a more general definition. For example, premiums paid on an insurance policy may be refunded (or clawed back) if the policy is cancelled in a certain time frame. Such an arrangement is specified in the contract and referred to as a clawback provision.

Clawback

1. A drop in a security's price after a previous rise.

2. Money that must be refunded or given back for some reason or other. The term especially applies to tax advantages extended to a taxpayer subject to certain conditions that the taxpayer did not fulfill.

clawback

1. A provision in an incentive stock option that requires an employee to reimburse the company for any gains from exercising options in the event the employee goes to work for a direct competitor within a specified number of months of exercise.
2. Excessive management share of profits that must be refunded to investors of a venture capital fund. A clawback is required when managers of a venture capital fund take a contractual share of early investment gains that are subsequently reduced by losses.
References in periodicals archive ?
Defining success and failure for clawbacks In a typical optimal compensation problem, shareholders cannot directly observe or contract for the manager's effort.
He said that these days he is seeing more economic developers willing to apply the clawbacks provisions.
When it did allege a clawback claim, it did so because a defendant personally engaged in alleged fraud or similar misconduct that led to the filing of a restatement.
Yet another clawback provision was recently promulgated in Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
The Trust has been leading an investor coalition on the issue of clawbacks since 2012.
According to the Warwick Business School, bonus clawback at UK banks could in turn affect risk-taking abilities of banks.
To enforce the rule, the nation's stock exchanges would have to adopt, within 90 days of the final rule, listing standards requiring all listed companies to adopt and comply with a written clawback policy.
that the frequency of excess-pay clawbacks among firms too small to be
15, backed clawbacks for use when good performance by a trader or senior manager turns out to have been illusory.
The clawbacks, though, threaten to undo that good work.
Clawbacks are far more common than they were five years ago, especially among cities.
Under the new system, retroactive to April l, 2002, all physicians will be permitted gross earnings of $455,000 a year without penalty of any clawbacks.