“Continuously”

This week I had the pleasure of giving two in-house “Drafting Clearer Contracts” seminars in Doha, Qatar. As often happens, I came away with with a new issue to explore.

In particular, one of the participants asked me what I thought of use in contracts of the adverb continuously. He didn’t think much of it. And now I can say that neither do I.

That’s because unless you specify otherwise, a provision will apply continuously. Consider the following examples from the great boneyard that is the SEC’s EDGAR system. In each case, I’d omit the word continuously, as being redundant. (Note that in the first two of the six examples below, continuously modifies an adjective; in the rest, it modifies a verb.)

Subject to the terms of this Agreement, the Company … shall use its reasonable best efforts to keep such Registration Statement, with respect to each Holder, continuously effective under the Securities Act until the earlier to occur of …

As used herein, the term “Electronic Prospectus” means a form of prospectus, and any amendment or supplement thereto, that meets each of the following conditions: … (iii) it shall be in or convertible into a paper format or an electronic format, satisfactory to the Representative, that will allow recipients thereof to store and have continuously ready access to the prospectus at any future time, without charge to such recipients …

At all times after the Company has filed a registration statement with the SEC pursuant to the requirements of the Securities Act and until the Termination Date, the Company shall use reasonable best efforts to continuously maintain in effect the registration statement of Common Stock under Section 12 of the Exchange Act …

The Adviser shall … continuously furnish an investment program, …

“Cash Equivalents” means … (e) shares of any money market mutual fund that (i) has substantially all of its assets invested continuously in the types of investments referred to in clauses (a) and (b) above, …

The Borrower (and each applicable Credit Party) shall … (b) Without limiting the foregoing, with respect to each Eligible Ground Lease related to any Unencumbered Pool Property: … (v) diligently and continuously enforce the material obligations of the ground lessor or other obligor thereunder; …

Another drawback with continuously is that it could be understood as suggesting nonstop, every-minute-of-the-day activity. That usually doesn’t make sense, as in the following examples:

… provided, however, if such default under this clause (iii) is reasonably susceptible of cure, but not within such thirty (30) day period, then such Issuer may be permitted an additional ninety (90) days to cure such default provided such Issuer diligently and continuously pursues such cure; …

… the Advisor shall … (ii) supervise continuously the investment program of the Trust and the composition of its investment portfolio; …

But one can find examples where circumstances make it appropriate to emphasize that something is nonstop:

The net quantity, reported in cubic meters corrected to 15 deg.C and 101.325 kPa, and quality of Product delivered through the Meters shall be documented by meter tickets, which will be made available to both Parties electronically via a continuously “on” data link and by hard paper copy in no event later than twenty four (24) hours following the completion of a unit train loading at the Rail Terminal.

I suspect that even here, one could find a better word.

Necessarily, the adjective continuous shares the same shortcomings as continuously:

“Restricted Stock” means Common Stock granted pursuant to Section 9 that is subject to certain specified restrictions (including, without limitation, a requirement that the Participant remain continuously employed or provide continuous services for a specified period of time).

One exception is use of continuous in connection with the securities term of art continuous offering:

On or prior to the Filing Date, the Company shall prepare and file with the Commission the Initial Registration Statement covering the resale of all of the Registrable Securities for a resale offering to be made on a continuous basis.

 

 

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.