Which of the Following Statements Is Incorrect

question 4

Multiple Choice

Which of the following statements is incorrect?
1) prepare a disclosure document before the proposed offer of debentures
2) appoint a trustee whose task is to monitor the borrower so as to safeguard the investors
3) keep a register of debenture holders

• A)There is no specific format for a debenture
• B)The term 'mortgage debenture' can only be used to describe a debenture that is secured by a first mortgage over real estate, where the loan does not represent more than 60% of the value of property under charge
• C)The term 'debenture' can only be used to describe a debenture that is fully secured by charges over company assets
• D)None of the above

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Definitions:

Reacquire Stock

The process by which a company buys back its own shares from the marketplace, reducing the amount of outstanding stock.

Stock Option Plans

A compensation strategy companies use, offering employees the option to buy company stock at a specific price for a certain period.

Acquiring Corporations

Companies that purchase a majority stake in other companies to take control of them.

Stated Dividend

A fixed amount declared by a company's board of directors that is paid to shareholders, typically on preferred stock.