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Equity contribution agreement |
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Definition of Equity contribution agreementEquity contribution agreementAn agreement to contribute equity to a project under certain specified
Related Terms:All equity rateThe discount rate that reflects only the business risks of a project and abstracts from the Asset/equity ratioThe ratio of total assets to stockholder equity. Bond agreementA contract for privately placed debt. Bottom-up equity management styleA management style that de-emphasizes the significance of economic Bretton Woods AgreementAn agreement signed by the original United Nations members in 1944 that Buy/Sell AgreementThis is an agreement entered into by the owners of a business to define the conditions under which the interests of each shareholder will be bought and sold. The agreement sets the value of each shareholders interest and stipulates what happens when one of the owners wishes to dispose of his/her interest during his/her lifetime as well as disposal of interest upon death or disability. Life insurance, critical illness coverage and disability insurance are major considerations to help fund this type of agreement. Cash deficiency agreementAn agreement to invest cash in a project to the extent required to cover any cash ![]() Common stock/other equityValue of outstanding common shares at par, plus accumulated retained Concession agreementAn understanding between a company and the host government that specifies the Conditional Sale AgreementAn agreement entered into between a conditional buyer and a conditional seller setting out the terms under which goods change hands. Confidentiality AgreementA legal document whereby the one party, usually the prospective investor, pledges to keep strictly confidential, and return on request, any and all information provided by the entrepreneur seeking funding. Contra-equity accountAn account that reduces an equity account. An example is Treasury stock. ContributionAlso the difference between the selling price and variable costs, which can be expressed either per Contribution marginThe difference between variable revenue and variable cost. contribution marginAn intermediate measure of profit equal to sales revenue contribution marginthe difference between selling price and ![]() Contribution marginThe margin that results when variable production costs are subtracted contribution margin ratiothe proportion of each revenue dollar remaining after variable costs have been covered; Contribution PrincipleThis is the principle which specifies the factors that must be taken into account when calculating dividends. At Canada Life, the key factors are: interest earnings, mortality, and operating expense. Contribution RateThe percentage tax charged by a state to an employer to Cost of EquitySame as the cost of common stock. Sometimes viewed as the Debt/equity ratioIndicator of financial leverage. Compares assets provided by creditors to assets provided Debt/Equity RatioA comparison of debt to equity in a company's capital structure. debt-to-equity ratioA widely used financial statement ratio to assess the Deferred equityA common term for convertible bonds because of their equity component and the Defined contribution planA pension plan in which the sponsor is responsible only for making specified Defined Contribution PlanA qualified retirement plan under which the employer Double-tax agreementagreement between two countries that taxes paid abroad can be offset against Dual syndicate equity offeringAn international equity placement where the offering is split into two EquityRepresents ownership interest in a firm. Also the residual dollar value of a futures trading account, EquityFunds raised from shareholders. EquityAmounts contributed to the company by the owners (contributed capital) plus the residual earnings of the business (retained earnings). equityRefers to one of the two basic sources of capital for a business, the EquityThe difference between the total of all recorded assets and liabilities on the balance EquityOwnership. Common stock represents equity in a corporation. EquityThe net worth of a business, consisting of capital stock, capital (or paid-in) surplus (or retained earnings), and, occasionally, certain net worth reserves. Common equity is that part of the total net worth belonging to the common shareholders. Total equity includes preferred shareholders. The terms common stock, net worth, and common equity are frequently used interchangeably. equityThe net worth of a company. This represents the ownership interest of the shareholders (common and preferred) of a company. For this reason, shares or stocks are often known as equities. Equity-based insuranceLife insurance or annuity product in which the cash value and benefit level fluctuate according to the performance of an equity portfolio. Equity Buy-BackRefers to the investors percentage ownership of a company that can be re-acquired by the company, usually at a pre-determined amount. Equity capAn agreement in which one party, for an upfront premium, agrees to compensate the other at Equity claimAlso called a residual claim, a claim to a share of earnings after debt obligation have been Equity collarThe simultaneous purchase of an equity floor and sale of an equity cap. Equity floorAn agreement in which one party agrees to pay the other at specific time periods if a specific Equity investmentThrough equity investment, investors gain part ownership of the corporation. The primary type of equity investment is corporate stock. Equity kickerUsed to refer to warrants because they are usually issued attached to privately placed bonds. Equity-linked policiesRelated: Variable life Equity marketRelated:Stock market Equity MethodAccounting method for an equity security in cases where the investor has sufficient Equity multiplierTotal assets divided by total common stockholders' equity; the amount of total assets per Equity optionsSecurities that give the holder the right to buy or sell a specified number of shares of stock, at Equity SecurityAn ownership interest in an enterprise, including preferred and common stock. Equity swapA swap in which the cash flows that are exchanged are based on the total return on some stock EquityholdersThose holding shares of the firm's equity. Euroequity issuesSecurities sold in the Euromarket. That is, securities initially sold to investors Federal Insurance Contributions Act of 1935 (FICA)A federal Act authorizing the government to collect Social Security and Medicare payroll taxes. Fiscal agency agreementAn alternative to a bond trust deed. Unlike the trustee, the fiscal agent acts as an Foreign equity marketThat portion of the domestic equity market that represents issues floated by foreign companies. Forward rate agreement (FRA)agreement to borrow or lend at a specified future date at an interest rate GEMs (growing-equity mortgages)Mortgages in which annual increases in monthly payments are used to General Agreementon Tariffs and Trade (GATT) a treaty Interest rate agreementAn agreement whereby one party, for an upfront premium, agrees to compensate the Investor's equityThe balance of a margin account. Related: buying on margin, initial margin requirement. Leveraged equityStock in a firm that relies on financial leverage. Holders of leveraged equity face the Long-term debt to equity ratioA capitalization ratio comparing long-term debt to shareholders' equity. North American Free Trade Agreement (NAFTA)an agreement among Canada, Mexico, and the United States establishing the North American Free Trade Zone, with a resulting reduction in trade barriers Note agreementA contract for privately placed debt. owners' equityRefers to the capital invested in a business by its shareowners Owners' equityThe total of all capital contributions and retained earnings on a business’s Preferred equity redemption stock (PERC)Preferred stock that converts automatically into equity at a Preferred stock agreementA contract for preferred stock. product contribution marginthe difference between selling price and variable cost of goods sold Purchase agreementAs used in connection with project financing, an agreement to purchase a specific Purchase AgreementThis legal document records the final understanding of the parties with respect to the proposed transaction. Quasi-EquityFunds, other than paid-up capital and retained earnings, employed in a business and which will remain in a business as permanent capital. RATE OF RETURN ON STOCKHOLDERS’ EQUITYThe percentage return or profit that management made on each dollar stockholders invested in a company. Here’s how you figure it: RATIO OF DEBT TO STOCKHOLDERS’ EQUITYA ratio that shows which group—creditors or stockholders—has the biggest stake in or the most control of a company: Raw material supply agreementAs used in connection with project financing, an agreement to furnish a Repurchase agreementAn agreement with a commitment by the seller (dealer) to buy a security back from Return on Common Equity RatioA measure of the percentage return earned on the value of the Return on equity (ROE)Indicator of profitability. Determined by dividing net income for the past 12 return on equity (ROE)This key ratio, expressed as a percent, equals net Revolving credit agreementA legal commitment wherein a bank promises to lend a customer up to a Self-Employment Contributions Act (SECA)A federal Act requiring self-employed business owners to pay the same total tax rates for Social Security and Shareholder's EquityRepresents the total assets of a corporation less liabilities. Shareholders' equityThis is a company's total assets minus total liabilities. A company's net worth is the Shareholders' equityThe total amount of contributed capital and retained earnings; synonymous with stockholders' equity. Shareholders' EquityThe residual interest or owners' claims on the assets of a corporation Smithsonian agreementA revision to the Bretton Woods international monetary system which was signed at Standby agreementIn a rights issue, agreement that the underwriter will purchase any stock not purchased by investors. Standstill agreementsContracts where the bidding firm in a takeover attempt agrees to limit its holdings Stockholder equityBalance sheet item that includes the book value of ownership in the corporation. It Stockholder's equityThe residual claims that stockholders have against a firm's assets, calculated by Stockholders' equityThe total amount of contributed capital and retained earnings; synonymous with shareholders’ equity. stockholders' equity, statement of changes inAlthough often considered STOCKHOLDERS’ (OR OWNERS’) EQUITYThe value of the owners’ interests in a company. Stratified equity indexingA method of constructing a replicating portfolio in which the stocks in the index Tax clawback agreementAn agreement to contribute as equity to a project the value of all previously Throughput agreementAn agreement to put a specified amount of product per period through a particular Throughput contributionSales revenue less the cost of materials. 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