Dividend Clawback

Dictionary Says

Definition of 'Dividend Clawback'

An arrangement under which those financing a project agree to contribute, as equity, any prior dividends received from the project to cover any cash shortages.
Investopedia Says

Investopedia explains 'Dividend Clawback'

When there is no cash shortfall, those investors who provided funding are able to keep their dividends. A dividend clawback arrangement provides incentive for a project to remain on budget so that investors do not have to return dividends received prior to a cost overrun.

Related Definitions

  • Dividend

    1. A distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders. The dividend is most often quoted in terms of the dollar amount ...
    Read More »
  • Project Finance

    Defined by the International Project Finance Association (IPFA) as the following: The financing of long-term infrastructure, industrial projects and public services based upon a ...
    Read More »
  • Double Taxing

    A tax law that causes the same earnings to be subjected to taxation twice. A company's income is taxed initially and then the shareholders and investors are taxed on the distributions ...
    Read More »
    • Dividend Yield

      A financial ratio that shows how much a company pays out in dividends each year relative to its share price. In the absence of any capital gains, the dividend yield is the return on ...
      Read More »
    • Declaration Date

      1. The date on which the next dividend payment is announced by the directors of a company. This statement includes the dividend's size, ex-dividend date and payment date. It is also ...
      Read More »
    • Residual Dividend

      The term residual dividend refers to a method of calculating dividends. A dividend is a payment made by a company to its shareholders. It is essentially a portion of the company's ...
      Read More »
    • Tax Clawback Agreement

      An arrangement whereby the tax benefits received from a given venture are reinvested in the venture to cover any cash shortages. A tax clawback is just one of many types of "clawback" ...
      Read More »
    • Scrip

      1. A written document that acknowledges a debt. 2. A temporary document representing a fraction of a share resulting from a split or spin-off. Scrips may be applied to the purchase of ...
      Read More »

Articles Of Interest

Partner Links