A contract that is negotiated directly between a borrowing firm and a bank and under which the borrower agrees to make a series of interest and principal payments to the bank on specific dates is called:

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A term loan is a type of loan where a borrowing firm negotiates directly with a bank to make a series of interest and principal payments on specific dates. This is different from commercial paper, which is a short-term, unsecured debt instrument issued by a company, and from convertible debt, which is a type of bond that can be converted into stock. Preferred stock and bond issues are also different types of financing that involve the sale of equity or debt securities to investors.

A Contract That Is Negotiated Directly Between a Borrowing Firm