Accounting 200 Bond Terminology

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What is the definition of Bond Indenture?

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The written contract that spells out the legal terms and conditions of the obligations of the bond issuer and the rights of the bondholders.

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Unsecure bonds

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Debentures

Front 3

Bonds for which property or real estate are specified as collateral.

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Secured or Mortgage-Backed Bonds

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Unsecured bonds issued by companies with low credit ratings.

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Junk Bonds

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Typically unsecured bonds that are designated as having priority or subordinated rights to other unsecured creditors

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Senior or Subordinated Bonds

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Bonds that require principal repayment in full at maturity

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Term Bonds

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Bonds that require principal repayment periodically throughout the term of the bond.

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Serial Bonds

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Bonds which may be converted to other securities, such as stock, after a specific period of time, at the option of the bondholder.

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Convertible Bonds

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Bonds which can be paid off prior to maturity at the option of the company issuing the bonds.

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Callable Bonds

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Bonds which are issued of cash in an amount greater or less than the face amount or principal of the note.

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Bond issured at a premium or a discount

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A market where bondholders may sell their bonds to other investors.

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Bond Exchange