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 ?
Wells Fargo's rule is written broadly enough that Stumpf was subject to a clawback even though the bank's $185 million fine did not force it to make a material restatement of its results.
Our Fourteenth Annual Survey of the Corporate Governance and Executive Compensation Practices of the 100 Largest US Public Companies shows that almost all of the largest companies already maintain voluntary clawback policies.
He said that these days he is seeing more economic developers willing to apply the clawbacks provisions.
Through these cases the SEC has taken the position that--despite a host of constitutional and other legal challenges--personal misconduct by CEOs and CFOs is not a condition necessary to warrant a Section 304 clawback because the CEO or CFO was "driving the bus" while the misconduct occurred.
Clawbacks | In current practice, bonus structures are often asymmetric in that, in good times, executives take home hefty pay packages, while in bad times they have a small or zero bonus.
that the frequency of excess-pay clawbacks among firms too small to be
The use of clawbacks was among the elements adopted, though there was no consensus on imposing actual limits on pay.
To provide a backdrop for later analyses of the deficiencies of clawbacks and quick-peeks, Part I will discuss the proposed amendments to the Federal Rules and their formal recognition of the validity of these agreements.
Although the precise terms of the deal are subject to confidentiality agreements, the consideration is based on levels of renewal business and is subject to clawbacks if targets are not met.
CHANCELLOR Gordon Brown came to the rescue last night as the scandal of tax credit clawbacks threatened to engulf the Government.
But what if the combined effects of two clawbacks would reduce the traditional Social Security benefit below the guaranteed minimum the White House says it wants to preserve?
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.