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Agreement between lender and borrower that details specific terms of the bond issuance. Specifies legal obligations of bond issuer and rights of bondholders. An indenture spells out the specific terms of a bond, as well as the rights and responsibilities of both the issuer of the security and the holder.


A contract for a bond. An indenture sets the terms of the bond; for example, it includes the coupon rate, the period until maturity, and whether the bond comes with any special features like convertibility or whether it is callable. All bonds must have an indenture. Indentures are usually summarized in a bond's prospectus.


A legal contract between a bond issuer and its lenders that specifies the terms of the issue. Typical provisions are the amount and dates of interest payments, name of the trustee, maturity date, collateral, restrictions on dividends or other borrowing, and specifics of a sinking fund or potential calls. It is the trustee's job to ensure that the terms of the indenture are fulfilled. Also called bond indenture, trust deed. See also covenant.


An indenture is a written contract between a bond issuer and bond holder that is proof of the bond issuer's indebtedness and specifies the terms of the arrangement, including the maturity date, the interest rate, whether the bond is convertible to common stock, and, if so, the price or ratio of the conversion.

The indenture, which may be called a deed of trust, also includes whether the bond is callable -- or can be redeemed by the issuer before it matures -- what property, if any, is pledged as security, and any other terms.

References in periodicals archive ?
To avoid potential due-on-sale issues contained in deeds of trusts, you may wish to negotiate that the manner of holding title may change if the interests of the principals is the same, or if a change is desirous by the parties for exchange in an eventual sale, or estate planning.
11, 1992, in accordance with the company's various mortgages and deeds of trust.
The mortgage loans consist of fixed- and adjustable-rate subprime mortgage loans and are secured by first- and second-lien mortgages or deeds of trust on residential properties.
Most notably, certain of the properties acquired are subject to outstanding promissory notes which are secured by deeds of trust on the properties.
The aforementioned trust consists of fixed- and adjustable-rate conventional mortgage loans evidenced by promissory notes secured by first and second liens, deeds of trust, security deeds or mortgages.
The mortgage loans consist of fixed and adjustable rate sub-prime mortgage loans secured by first or second lien mortgages or deeds of trust on residential properties.