Cumulative Deferral Clause Samples
A Cumulative Deferral clause allows for the postponement of certain obligations or payments, with the deferred amounts accumulating over time rather than being waived. In practice, this means that if a party is unable to fulfill a payment or duty at the scheduled time, the outstanding amount or obligation is carried forward and added to future periods until it is eventually satisfied. This clause is commonly used in financial agreements to provide flexibility for parties facing temporary cash flow issues, while ensuring that all obligations will ultimately be met. Its core function is to offer relief from immediate performance requirements without permanently excusing the underlying responsibility, thereby balancing flexibility with accountability.
Cumulative Deferral. (A) The amount of any Distribution deferred pursuant to this Section 2.05(d) shall constitute “Arrears of Distribution.” The Company may, at its sole discretion, elect to further defer any Arrears of Distribution by complying with the notice requirements in this Section 2.05(d) applicable to any deferral of any Distribution. The Company is not subject to any limit as to the number of times any Distribution and/or Arrears of Distribution (including any Additional Distribution Amount) may be deferred pursuant to this Section 2.05(d) except that this Section 2.05(d)(iv) shall be complied with until all outstanding Arrears of Distribution have been paid in full.
(B) Each amount of Arrears of Distribution shall bear Distribution at the Distribution Rate as if it constituted the principal of the Securities and the amount of such Distribution (the “Additional Distribution Amount”) with respect to Arrears of Distribution shall be due and payable pursuant to this Section 2.05 and shall be calculated by applying the Distribution Rate to the amount of the Arrears of Distribution and otherwise mutatis mutandis as provided in the foregoing provisions of this Section 2.05. The Additional Distribution Amount accrued up to any Distribution Payment Date shall be added, for the purpose of calculating the Additional Distribution Amount accruing thereafter, to the amount of Arrears of Distribution remaining unpaid on such Distribution Payment Date so that such Additional Distribution Amount will itself become Arrears of Distribution.
Cumulative Deferral. Any Distribution deferred pursuant to Securities Condition 5.5 Satisfaction of Arrears of