Which of the following is NOT TRUE? The major disadvantages of long-term debt include the increased financial risk of the firm resulting from the use of debt. The indenture is a contract between the issuer and lenders that specifies the manner in which the principal must be repaid, details the nature of the debt issue, and lists any restrictive covenants. When the investor's required rate of return is smaller than the coupon rate of a bond, the bond will sell at a discount. The call feature of a corporate bond is an advantage to the issuing company if interest rates decrease.