If a company fails to meet the terms of the indenture, it is
A) bankrupt
B) in default
C) profitable
D) in registration

Question

If a company fails to meet the terms of the indenture, it is​
A) ​bankrupt
B) ​in default
C) ​profitable
D) ​in registration

Quizplus · Accepted Answer

If a company fails to meet the terms of the indenture, it is considered to be in default. This means they have not fulfilled their obligations under the agreement and could potentially face legal action from bondholders. Bankruptcy may be a potential result of prolonged default, but it is not the immediate consequence. Profitability and registration do not have any direct correlation with defaulting on an indenture agreement.

If a Company Fails to Meet the Terms of the Indenture