Chapter 14: Bonds and Long Term Notes
bonds
A form of debt consisting of separable units that obligates the issuing corporation to repay a stated amount at a specified maturity date and pay interest between the issue date and maturity
callable
allows the issuing company to buy back, or call, outstanding bonds from the bondholders before their scheduled maturity date.
mortgage bond
backed by a lien on specified real estate owned by the issuer
debenture bond
backed only by the "full faith and credit" of the issuing corporation
convertible bonds
bonds for which bondholders have the option to convert the bonds into shares of stock.
coupons bonds
name of the owner was not registered; the holder actually clipped an attached coupon and redeemed it in accordance with instructions on the indenture.
subordinated debenture
the holder is not entitled to receive any liquidation payments until the claims of other specified debt issues are satisfied
sinking fund debentures
bonds that must be redeemed on a prespecified year-by-year basis; administered by a trustee who repurchases bonds in the open market.
bond indenture
document that describes specific promises made to bondholders
serial bonds
more structured (and less popular) way to retire bonds on a piecemeal basis (installments)