Corporations That Attach Warrants to Their Bonds Are Hoping To

question 39

Multiple Choice

Corporations that attach warrants to their bonds are hoping to:

• A)Sell equity without paying flotation costs
• B)Convert the bonds into stock at a later date
• C)Reduce the cost of debt by increasing bond prices
• D)Increase the price of their shares

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Definitions:

LLC

Limited Liability Company, a business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.

Organization

An entity, such as a company or society, formed by a group of people for a particular purpose.

Operating Agreement

A document detailing the management and operational protocols for a limited liability company (LLC) between its members.

Articles of Organization

Legal documents filed with a state government to legally document the creation of a limited liability company (LLC).