Generally speaking, bonds are IOUs. It says how much so-and-so owes the holder, when to redeem it, and what is the interest. Many investors will buy corporate bonds for profit. 1. How long is the term of corporate bonds? Corporate bonds refer to loan certificates issued by joint-stock companies for additional capital within a certain period of time (such as 10 or 20 years). For the holder, it is only a voucher to provide loans to the company, reflecting only an ordinary creditor-debtor relationship. Although the holder has no right to participate in the operation and management activities of the joint-stock company, he can charge the company fixed interest at par value every year, and the order of collecting interest should take precedence over shareholders' dividends. When the joint-stock company goes bankrupt, he can also get back the principal first. Corporate bonds have a long term, generally more than 10 years. Once the bond expires, the joint-stock company must repay the principal and redeem the bond. Second, the main characteristics of corporate bonds 1, the repayment source of risky bonds is the company's operating profit, but there is great uncertainty in the future operation of any company, so corporate bondholders bear the risk of losing interest or even principal. 2. The principle that high rate of return is proportional to risk requires that high-risk corporate bonds should provide bondholders with higher return on investment. 3. Issuers and holders of options can give each other certain options. 4. The right to operate reflects the creditor's rights relationship, and it does not have the right to operate and manage the company, but it can claim interest and compensation first and distribute the remaining assets before shareholders. Three. Corporate bond guarantee 1. The scope of guarantee includes the principal and interest of corporate bonds, liquidated damages, damages and expenses for realizing creditor's rights. 2. If the guarantee is provided by way of guarantee, it shall be joint and several liability guarantee, and the assets of the guarantor are of good quality. 3. If there is a property guarantee, the ownership of the secured property is clear, and it has not been secured or taken preservation measures, and the value assessed by a qualified asset appraisal agency is not less than the guaranteed amount. To sum up, we can know that the term of corporate bonds is very long, generally more than 10 years. Once the bond expires, the joint-stock company must repay the principal and redeem the bond.
Legal objectivity:
Article 15 of the Securities Law of People's Republic of China (PRC) The public offering of corporate bonds shall meet the following conditions: (1) It has a sound organizational structure; (2) The average distributable profit in the last three years is enough to pay the interest of corporate bonds for one year; (3) Other conditions stipulated by the State Council. The funds raised by the public offering of corporate bonds must be used for the purposes listed in the Measures for Raising Corporate Bonds; Any change in the use of funds must be decided by the bondholders' meeting. The funds raised from the public offering of corporate bonds shall not be used to cover losses and unproductive expenditures. When a listed company issues corporate bonds that can be converted into shares, it shall comply with the provisions of the second paragraph of Article 12 of this Law in addition to the conditions stipulated in the first paragraph. However, according to the way of raising corporate bonds, unless a listed company converts corporate bonds by buying its own shares.