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Deficiency agreement
Deficiency agreementAn agreement that calls on the sponsor or another party to provide the shortfall when cash flow, working capital, or revenues are below agreed levels or are insufficient to meet debt service. RELATED TERMS-------------------------------------- Sponsor An underwriting investment company that offers shares in its mutual funds, or an influential institution that highly values a particular security and thus creates additional demand for the security. Cash The value of assets that can be converted into cash immediately, as reported by a company. Usually includes bank accounts and marketable securities, such as government bonds and banker's acceptances. Working Attempting to complete the remaining part of a trade, by finding either buyers or sellers for the rest. Capital 1) Assets used for the production of profits and wealth. 2) Owner's equity in a business. Revenues Sales or royalty proceeds. Quantity times price sold. Debt Money borrowed. SIMILAR TERMS-------------------------------------- Deficiency The amount by which a project's cash flow is not adequate to meet debt service. Deficiency letter Notification from the SEC to a prospective issuer of securities that revisions or additions need to be made to the preliminary prospectus. Deficit An excess of liabilities over assets, of losses over profits, or of expenditure over income. Deficit spending When government spending overwhelms government revenue resulting in government borrowing. Defined asset fund A unit investment trust consisting of a fixed portfolio of securities, including blue chips, REITs, or high-yielding stocks on a major exchange such as the NYSE or FTSE. Defined benefit plan A pension plan obliging the sponsor to make specified dollar payments to qualifying employees at retirement. Defined contribution plan A pension plan whose sponsor is responsible only for making specified contributions into the plan on behalf of qualifying participants. Defined event The definition applicable to the trigger of a loss in an insurance policy, particularly political risk insurance. PREVIOUS AND NEXT TERMS-------------------------------------- Deferred interest bond A bond that pays interest at a later date, usually in one lump sum, effectively reinvesting interest earned over the life of the bond. Deferred nominal life annuity A monthly fixed-dollar payment beginning at retirement age. It is nominal because the payment is fixed in a dollar amount at any particular time, up to and including retirement. Deferred payment annuity An annuity that stipulates payments be made to the annuitant at a later date, such as when the annuitant reaches a certain age. Deferred tax expense A non-cash expense that provides a source of free cash flow. Amount allocated during the period to cover tax liabilities that have not yet been paid. Deficiency The amount by which a project's cash flow is not adequate to meet debt service. Deficiency agreement Deficiency letter Notification from the SEC to a prospective issuer of securities that revisions or additions need to be made to the preliminary prospectus. Deficit An excess of liabilities over assets, of losses over profits, or of expenditure over income. Deficit spending When government spending overwhelms government revenue resulting in government borrowing. Defined asset fund A unit investment trust consisting of a fixed portfolio of securities, including blue chips, REITs, or high-yielding stocks on a major exchange such as the NYSE or FTSE. Defined benefit plan A pension plan obliging the sponsor to make specified dollar payments to qualifying employees at retirement. We thank you for using the Financial Dictionary to search for Deficiency agreement. If you have a better definition for Deficiency agreement than the one presented here, please let us know by making use of the suggest a term option. This definition of Deficiency agreement may be disputed by other professionals. Our attempt is to provide easy definitions on Deficiency agreement and any other medical topic for the public at large.
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