In a bond indenture, the term "security interest" refers to the fact that most firms that issue bonds are required to establish sinking fund provisions to protect bondholders.

Question

Quizplus · Accepted Answer

A security interest in a bond indenture refers to the collateral that the issuer pledges as security for repayment of the bond, not sinking fund provisions. Sinking fund provisions are a common feature of bond indentures but are not directly related to security interests.

In a Bond Indenture, the Term "Security Interest" Refers to the Fact