BU397 Chapter Notes - Chapter 14: Underwriting, Private Placement, Interest Rate
Document Summary
Obligations which are not payable within one year: or one business operating cycle, what ever is longer. Often has restrictive covenants attached: these are terms and conditions. Requires repayment of principle at a future date and period it interest. Different from bonds because they don"t normally trade on public. Notes and bonds are recorded at the pv of future interest and principle payments markets: any premiums/discounts on the purchase of the bond/note payable is amortized over the life of the note. Bearer (coupon) bonds: not recorded in the owners name and may be transferred from one owner to another by just delivering it to the new owner. Registered bonds: bonds issued in the owners name, to sell a registered bond, the current certificate has to be surrendered and a new certificate is than issued. Secured debt: debt that is back by a pledge of some sort of collateral, collateral trust bonds or notes are secured by shares and.
