clawback business definition
- A provision in an incentive stock option that requires an employee to reimburse the company for any gains realized from exercising options in the event the employee goes to work for a direct competitor within a specified number of months of the exercise.
- 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.
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