What Is a Bond Covenant?
A bond contract is a legally binding agreement between a bond issuer and a bond custodian representing the interests of bond holders. Details of bond issuance, issuer obligations and investor rights. It mainly includes terms and conditions such as repayment, redemption, guarantee, sinking fund, liquidity ratio limit, etc., which are mostly formulated by the issuer. Most clauses are for the benefit of bondholders. If the complete contract is given to bondholders, they may have difficulty understanding their language, and it is even more difficult to determine at a certain time whether the company issuer is fulfilling its commitments. These issues are mainly addressed by introducing the company's custodian as a third party to the contract. The contract states that the company's custodian represents the interests of the bondholder, that is, the custodian acts as the trustee of the investor who owns the bond. A corporate custodian is a bond or trust company that has a corporate trust department and senior staff capable of performing custodian duties. [1]
Bond contract
discuss
- Chinese name
- Bond contract
- Nature
- Is a protocol
- the main purpose
- Protecting the interests of bondholders
- From
- Commercial Press "English-Chinese Securities Investment Dictionary"
- A bond contract is a legally binding agreement between a bond issuer and a bond custodian representing the interests of bond holders. Details of bond issuance, issuer obligations and investor rights. It mainly includes terms and conditions such as repayment, redemption, guarantee, sinking fund, liquidity ratio limit, etc., which are mostly formulated by the issuer. Most clauses are for the benefit of bondholders. If the complete contract is given to bondholders, they may have difficulty understanding their language, and it is even more difficult to determine at a certain time whether the company issuer is fulfilling its commitments. These issues are mainly addressed by introducing the company's custodian as a third party to the contract. The contract states that the company's custodian represents the interests of the bondholder, that is, the custodian acts as the trustee of the investor who owns the bond. A corporate custodian is a bond or trust company that has a corporate trust department and senior staff capable of performing custodian duties. [1]
- The Commercial Press's "English-Chinese Dictionary of Securities Investment" explains: bond contract indenture . Legal contracts that detail bond issuance issues, issuer obligations, and investor rights. It mainly includes terms and conditions such as repayment, redemption, guarantee, sinking fund, liquidity ratio limit, etc., which are mostly formulated by the issuer. A trust institution or issuer's bank account acts as the custodian of bond issuance and supervises the issuer's strict implementation of all terms in the contract. Also for: bond indenture