Definitions for "Funding Agreement"
Keywords:  stif, muni, illiquid, gics, guarantee
Insurance company general and separate account guaranteed contracts issued to institutional investors other than tax-qualified pension plans. These contracts offer a guarantee of principal, accumulated interest, and future interest for a specified period of time, but do not contain benefit-responsive features. Many are floating-rate instruments with a 30-day put at book issued to money-market and other short-term investment funds or corporate STIF funds. Some are medium-term fixed or floating rate instruments issued to foreign investors. The category also includes "muni-GICs" issued to state or local municipalities to enhance their credit or as short-term investment vehicles for project funds.
Illiquid insurance contracts that provide guaranteed principal repayment and interest payments for a predetermined period of time.
Funding agreements may be used in many financial situations, such as: environmental settlements, liability settlements, insurance policy buyouts, corporate buyouts, corporate liability defeasance, and cash management programs.
a legally enforceable agreement that sets out the terms and conditions governing funding from a grant-giving agency. The form of the agreement will depend on the intent of the grant and degree of control required.
a legally binding contract that places obligations on both the federal government and the foundation