Open-End Indenture

AAA

DEFINITION of 'Open-End Indenture'

A clause in a revenue-bond agreement that permits the issuance of additional revenue bonds in the future, provided that the revenue of the previous year was sufficient enough to cover the costs of the new issue.

INVESTOPEDIA EXPLAINS 'Open-End Indenture'

This type of restriction in a bond agreement mainly serves to provide flexibility for the bond issuer, allowing it to alter its financing mix. However, by stipulating that previous revenue levels must cover any new issues of bonds, bondholders are assured a measure of safety.

RELATED TERMS
  1. Indenture

    A legal and binding contract between a bond issuer and the bondholders.
  2. Debt Financing

    When a firm raises money for working capital or capital expenditures ...
  3. Bond

    A debt investment in which an investor loans money to an entity ...
  4. Revenue Bond

    A municipal bond supported by the revenue from a specific project, ...
  5. Municipal Bond

    A debt security issued by a state, municipality or county to ...
  6. Surrender Period

    The amount of time an investor must wait until he or she can ...
Related Articles
  1. Investing

    The Advantages Of Bonds

    Bonds contribute an element of stability to almost any portfolio and offer a safe and conservative investment.
  2. Bonds & Fixed Income

    The Basics Of Municipal Bonds

    Investing in these bonds may offer a tax-free income stream but they are not without risks.
  3. Retirement

    Bond Basics Tutorial

    Investing in bonds - What are they, and do they belong in your portfolio?
  4. Stock Analysis

    Why Should You Invest In Stratasys Today?

    When Stratasys pre-announced its fourth-quarter earnings, management highlighted that its MakerBot acquisition was underperforming expectations.
  5. Economics

    What Would Happen If Interest Rates Rise?

    This time around, while U.S. long-term yields have rebounded from their January lows, rates have generally been lower than where they ended 2014.
  6. Investing

    Strategies To Position Your Bond Portfolio

    Fixed income investors may not be able to see them all right now, but important trends are stirring on the investment horizon.
  7. Savings

    How To Make Money With Airbnb: Risks & Rewards

    Airbnb lets you turn your home or spare room into extra cash. Here's how to make money and protect yourself from the risks.
  8. Investing News

    Folio Investing Brings Experience To Robo-Advisors

    Prior to the recent upsurge of robo advisors, Folio Investing established itself as an alternative investment service through its online service.
  9. Mutual Funds & ETFs

    Consider This High-Yield ETF's Risks and Rewards

    Finding quality high-yield opportunities isn’t easy, but the YieldShares High Income ETF (YYY) has potential.
  10. Investing

    What are Fixed-Income Securities?

    For a fixed-income security, the periodic return on the investment is the same throughout the life of the security. Principal is returned at the time of maturity. The payment can be in the form ...

You May Also Like

Hot Definitions
  1. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  2. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  3. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  4. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  5. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  6. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
Trading Center