Dividend Clawback
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. |
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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. |
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