Definitions for "Cumulative Dividends"
The type of dividends paid by most preferred stocks. If a corporation misses a cumulative dividend on preferred stock, then the missed dividend accumulates. The corporation can never again pay a common stock dividend until all missed accumulated preferred dividends have been paid.
the owner of preferred stock with cumulative dividends has the right to receive accrued (previously unpaid) dividends in full before dividends are paid to any other classes of stock.
A dividend which accumulates if not paid in the period when due and must be paid in full before other dividends are paid on the company's ordinary shares (see paragraph 3, Section IV above).