Business Pitch Dictionary by pitch.dog
Term-sheet economics · Working

Non-cumulative dividend

Also called: non-accruing dividend

ELI5

Unpaid dividends do not automatically pile up.

Used in conversation

“The term sheet uses a non-cumulative dividend.”

Definition

A dividend that does not accrue when not declared or paid, subject to the documents.

Here “Non-cumulative dividend” means: A dividend that does not accrue when not declared or paid, subject to the documents.

Pitch context

You will see “Non-cumulative dividend” in fundraising decks, data rooms, term sheets and investor conversations when the discussion reaches term-sheet economics.

Why it matters: In term-sheet economics, a loose definition can change rights, obligations, approval, disclosure or enforceability.

Caution

Meaning, enforceability and required process vary by jurisdiction and agreement; this definition is not legal advice.

Sources & evidence · 5

Direct term-level sources and supporting source families.