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Listed below are some provisions that are often contained in bond indentures: 1. Fixed assets may be used as security. 2. The bond may be
Listed below are some provisions that are often contained in bond indentures:
1. | Fixed assets may be used as security. |
2. | The bond may be subordinated to other classes of debt. |
3. | The bond may be made convertible. |
4. | The bond may have a sinking fund. |
5. | The bond may have a call provision. |
6. | The bond may have restrictive covenants in its indenture. |
Which of the above provisions, each viewed alone, would tend to reduce the yield to maturity investors would otherwise require on a newly issued bond?
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