2FB3 Chapter 8

the actual debt contract with details of the debt issue and restrictions on the issuer

• Subordinated debenture

• Indenture

• Bond covenants

• Mortgage bonds

a provision in a bond indenture requiring the issuer to meet certain stated conditions

• Equipment trust certificates

• Income bonds

• Bond covenants

• Mortgage bonds

debt with collateral

• Unsecured debt

• Convertible bonds

• Collateral trust bonds

• Secured bonds

secured debt with assets such as land and buildings pledged as collateral (e.g. first, second mortgage)

• Mortgage bonds

• Debenture

• Equipment trust certificates

• Secured bonds

secured debt with financial assets such as common stock of other firms as collateral

• Collateral trust bonds

• Bond covenants

• Income bonds

• Equipment trust certificates

secured debt for financing the purchase of major equipment (e.g. airplanes)

• Unsecured debt

• Mortgage bonds

• Income bond

• Equipment trust certificates

debt with NO collateral

• Subordinated debenture

• Unsecured debt

• Convertible bonds

• Mortgage bonds

unsecured debt, junior to secured debt in claims to the firm's assets in case of default

• Income bonds

• Indenture

• Debenture

• Mortgage bonds

unsecured debt, junior to debentures in claims to the firm's assets in case of default

• Convertible bonds

• Debenture

• Subordinated debenture

• Bond covenants

unsecured debt, junior to debentures in claims to the firm's assets in case of default

• Mortgage bonds

• Income bonds

• Collateral trust bonds

• Subordinated debenture