Cure periods: only if your contract says so

What a cure provision looks like

It sits in or immediately after the events of default list, and it reads along the lines of: an event of default occurs if the breach continues for a stated number of days after written notice from the holder. Three separate things have to be in that sentence for it to help you — a triggering breach that qualifies, a notice requirement, and a period.

Common drafting patterns worth knowing:

The notice question underneath it

A cure period that runs from written notice is only as good as the notice clause. Check where notice must be sent, by what method, and when it is deemed received. If notice is deemed given on the date of email transmission to the address on the signature page, a period can be running against you before anyone reads it.

Declaring a default and acting on it are different

The existence of a default gives the holder a right. It does not oblige it to act immediately, and it does not mean the right expires if it waits. Most agreements include a no-waiver clause providing that accepting a late or partial payment, or not enforcing a term on one occasion, does not waive it later. So quiet weeks after a breach are not evidence that the breach has gone away.

What happens when the window closes

The consequence that matters is acceleration, and on a fixed-total product it works differently from a loan.

On an amortising loan, acceleration makes the outstanding principal plus accrued interest immediately due. On a purchase of future receivables, there is no principal balance and no accrued interest — the obligation is the unpaid part of the purchased amount, which already contains the whole of the cost. Acceleration therefore demands a figure that includes cost you would only have borne over the remaining months, delivered at once.

Alongside acceleration, the remedies section typically permits enforcement of the personal or validity guarantee, collection against the UCC-1, and recovery of the holder's enforcement costs from you.

The covenants that default you without a missed payment

Read the events of default list for things that are not about money, because these are where a business in reasonable health trips.

• Taking additional financing, which most short-term agreements list outright.
• Changing bank accounts, or adding one, without written consent.
• Failing to deliver statements or reports on a stated schedule.
• Letting insurance lapse, or changing the loss payee.
• Selling material assets, changing ownership, or moving premises.
• Any representation in the application later proving to have been untrue.

Several of those are things an owner does in the ordinary course without thinking of them as contractual events. Two of them — a new bank account and a second funding — are the most common causes of a default on a business that never missed a debit.

If you are inside a cure window

Act on the day you learn about it. Do the thing that cures the breach, then confirm in writing that you have done it, addressed and delivered exactly as the notice clause requires, with proof of delivery. Ask for written confirmation that the default is cured. If the breach cannot be cured inside the window, say so before the window closes and propose something specific — that is a materially better position than letting it expire in silence.

If there is no cure period at all

Then the timing question changes shape. What matters is not whether you can fix it in time but whether the holder chooses to exercise remedies, which is a commercial decision. That is a conversation to have early, with numbers, rather than after acceleration.

Ask for a cure period before you sign

It is an ordinary request, and the shape of the ask matters more than the length. Ask for written notice as a precondition to any payment default, five business days to cure a failed debit, ten business days on a non-monetary breach, and notice by email and a physical method with actual receipt rather than deemed receipt.

You may get one of the four. One is worth having, and the reply tells you how the holder intends to behave when something goes wrong.

Keep the reply either way. An email in which a funder declines to give you five days to cover a failed debit is a document worth having on file if the relationship later needs restructuring.

This is general information, not legal advice. Whether a cure period exists in your agreement, whether it has been triggered, and what the notice provisions require are questions about your specific contract and your state's law — a lawyer licensed in your state is the person to read it.