Indenture For Secured Advances In Utah
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FAQ
What is the primary purpose of a bond indenture? To specify the bond's features and identify the issuer's sources of repayment. To provide a detailed history of the issuer's past financial performance.
A contract between an Issuer and a Trustee (normally a commercial bank with trust powers) under which the Issuer issues Bonds and specifies their Maturities, Interest Rates, Redemption provisions, form, exchange provisions, security and other terms.
The Trust Indenture Act requires certain prospectus disclosure about the debt securities in registered offerings. Most offerings of debt securities that are exempt from registration under the Securities Act of 1933 are also exempt from the Trust Indenture Act requirements.
Most bonds are issued pursuant to a Trust Indenture. In certain instances, bonds are issued pursuant to a Resolution of the issuer. Unless otherwise stated, the term Indenture, as used in this chapter, includes the Resolution. The Indenture is a contract between the issuer and the bond trustee.
In real estate, an indenture is a deed in which two parties agree to continuing obligations. For example, one party may agree to maintain a property and the other may agree to make payments on it.
Most bonds are issued pursuant to a Trust Indenture. In certain instances, bonds are issued pursuant to a Resolution of the issuer.
To issue a bond, the issuer hires a third-party trustee, usually a bank or trust company, to represent investors who buy the bond. The agreement entered into by the issuer, and the trustee is referred to as the trust indenture.
An indenture is a deed with more than one party. In the old days they were written out, two copies, on a single piece of parchment then roughly cut, so the parts could later be compared. A deed of trust has at least two parties, the settler and the trustee, so it could be called an indenture.
The Trust Indenture Act of 1939 requires corporate bonds of $5 million or more offered for public sale to have a trust indenture, which is a contract between the bond issuer and bondholder. This makes the mortgage bond the correct answer.
The Indenture pledges certain revenues as security for repayment of the Bonds. The Trustee agrees to act on behalf of the holders of the Bonds and to represent their interests.
