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Clawback |
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ClawbackA 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.ClawbackA term used in life assurance where under certain conditions, life assurance premium relief (LAPR) given under a life policy could be recovered (or clawed back) by the Inland Revenue. Although not extinct, the situation has much less relevance nowadays.Where a life company advances indemnity commission to an agent, the company does so on the understanding it will be entitled to recover some or all of the commission paid if the relevant policy is cancelled within a given period.Similar MatchesTax clawback agreementTax clawback agreementAn agreement to contribute as equity to a project the value of all previously realized project-related tax benefits not already clawed back. Exercised to the extent required to cover any cash deficiency of the project. Dividend clawbackDividend clawbackAn arrangement under which sponsors of a project agree to contribute as equity any prior dividends received from the project to the extent necessary to cover any cash deficiencies. |
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