Call provision
Call provision is a provision that gives the issuing corporation the right to call the bonds for redemption. The call provision generally states that if the bonds are called then the company must pay the bondholders an amount greater than the par value, or a call premium. Most bonds contain a call provision.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Call provision. Gives the issuing corporation the right to call the bonds for redemption. The call provision generally states that if the bonds are called then the company must pay the bondholders an amount greater than the par value, or a call premium. Most bonds contain a call provision.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
