Question

A bond indenture is
A. a contract between the corporation issuing the bonds and the underwriters selling the bonds
B. the amount due at the maturity date of the bonds
C. a contract between the corporation issuing the bonds and the bond trustee, who is acting on behalf of the bondholders.
D. the amount for which the corporation can buy back the bonds prior to the maturity date

Answer 1

Answer:

C. A contract between the corporation issuing the bonds and the bond trustee, who is acting on behalf of the bondholders.

Explanation:

A bond indenture specifies the contract which is between the bond issuers and bond holders. The contract specifies all the obligations owed by the issuers to the bond holders.

In this case the right definition of indenture would be a contract between the corporation issuing the bonds and the bond trustee, who is acting on behalf of the bondholders.

Hope that helps.