What is a bond indenture?
A)Guarantee of the price to the borrower.
B)Contract that outlines the terms of the borrowing agreement.
C)Promise from the borrower to restrict certain activities.
D)Feature that permits the borrower to redeem before maturity.

Question

Quizplus · Accepted Answer

A bond indenture is a legal contract between the issuer of a bond and its bondholders. It outlines the terms of the borrowing agreement, including the coupon rate, maturity date, and repayment schedule. It also includes any covenants or restrictions placed on the borrower, such as limitations on issuing additional debt or entering into certain business transactions.

What Is a Bond Indenture