Asked by Denise Maxim on Jul 07, 2024
Verified
A bond indenture is
A) a contract between the corporation issuing the bonds and the underwriters selling the bonds
B) the amount due at the maturity date of the bonds
C) a contract between the corporation issuing the bonds and the bondholders
D) the amount for which the corporation can buy back the bonds prior to the maturity date
Bond Indenture
A legal document specifying the terms and conditions of a bond issue, including the interest rate, maturity date, and other obligations of the issuer.
Bondholders
Individuals or institutions that hold the debt securities issued by corporations or governmental entities.
- Recognize the various kinds of bonds along with their distinctive features.
Verified Answer
JR
Jordan RickerdJul 14, 2024
Final Answer :
C
Explanation :
A bond indenture is a legal document that outlines the terms and conditions of a bond issue. It is a contract between the corporation issuing the bonds and the bondholders, not the underwriters. It includes information such as the principal amount of the bond, the coupon rate, the maturity date, and any other relevant provisions.
Learning Objectives
- Recognize the various kinds of bonds along with their distinctive features.