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Accreted Value

The Price of the Zero Coupon Bond on the Call Date as calculated using the original interest rate to maturity as the Yield, the Call Date as the Settlement Date, and the Maturity of the Bond.

Accrued Interest

The amount of accrued interest to be paid the seller of a bond on a sale completed between interest payment dates. This result is per $1,000 par amount of bonds.

Advance Refunding

A financing transaction under which new bonds are issued to repay an outstanding bond issue prior to its first call date. Money raised from the new issue is usually placed in an escrow account and invested in government securities. The interest and principal repayments of these escrowed securities are used to pay the old bonds until they are able to be called.

AMT Bonds

The interest from certain tax-free municipal bonds is required to be included in the calculation of alternative minimum tax. These bonds are generally dubbed AMT bonds

Ask Price

The price at which an owner will sell a security.

Asset-backed Security

Structured financial products backed by assets such as student-loan, credit-card, and auto-loan receivables.

Auction Market

A market for securities in which trading in a particular security is conducted with all qualified persons able to verbally bid or offer securities against orders. U.S. Treasury Securities are offered via auction.

Average Life

A measure of how long it takes, on average, for the security to repay its principal.

 

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BAN

See Municipal Notes

Bankers Acceptance

BAs are negotiable time drafts drawn on banks, discounted, and redeemed by that bank at maturity for full face value.  Domestic BAs are created by U.S. banks on behalf of companies engaged in the importing, exporting, trading or storage of goods.  Yankee BAs are created by U.S. branches of foreign` banks on behalf of companies also engaged in the export-import business.

 

Barbell Portfolio

See Laddered Portfolio for a related topic). A common strategy for investing in bonds is to invest in bonds of differing maturities to hedge against fluctuations in interest rates. An investor with $160,000 to invest might structure a barbell portfolio, whereby $40,000 matures in one year, $10,000 matures in each of the next four years, and $40,000 matures in year ten. As the bonds come due at the end of year one, you might reinvest $30,000 to mature in one year (totaling $40,000), and the remaining $10,000 to mature in year nine (totaling $50,000). You reduce the impact of changing interest rates on the value of your portfolio.

Basis Point

One one-hundredth of one percent (1/100 or .01). Yield differences between fixed income securities are stated in basis points (e.g. The difference between a bond yielding 4.85% and one yielding 4.96% is 11 basis points).

Bearer Bond

A bond that has no identification of an owner. It is owned by the bearer, or the person that holds it.

Bid Price

The price at which the buyer will purchase a security.

Bond

Debt security that obligates the issuer to pay the holder interest during the term of the bond, with some exceptions, and the principal at or before maturity.

Bond Heaven

When bonds are sold to a portfolio to be held as an investment, as opposed to selling them to another securities dealer who can then re-offer them to other investors.

Bond Insurance (see Insured Bonds)

Brady Bond

These are bonds issued by third world nations such as Mexico, Brazil, and Argentina when they restructured their debt under a plan developed by former U.S. Treasury Secretary Nicholas Brady. The principal of the bonds as well as 12 to 18 months of interest payments are backed by U.S. Treasury securities.

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Callable Bond

Bonds which are redeemable by the issuer prior to the stated maturity date. A date and price are specified.

Call Date

The date on which a bond issuer has the right to redeem bonds prior to the specified maturity date.

Call Feature

Terms of a bond contract stating when the issuer of a bond has the right to prepay, or call, all or a portion of the principal prior to the stated maturity date. A price, usually expressed as a percentage, is stated. (See Call Premium).

Call Premium

A dollar amount, usually specified as a percentage of the principal amount being redeemed, paid as a "penalty" or a "premium" for the right to redeem early.

Call Price (see Call Premium)  

Capital Markets

The markets where capital funds - debt, or bonds, and equity, or stocks - are bought and sold.

Certificate of Deposit (CD)

A certificate issued for a deposit made at a banking institution. The bank agrees to pay a fixed interest rate for the specified period of time, and repays the principal at the maturity. CDs can be purchased directly from the banking institution or through a securities broker.

Certificates of Participation

A security representing an undivided interest in a pool of conventional mortgages (in the case of mortgage backed debt) or municipal lease payments (in the case of municipal certificates of participation. Principal and interest payments are passed through to the certificate holders each month.  Municipal COPs often have contingencies that must be met, such as requirements that the borrower must annually appropriate funds for principal and interest payments.

Collateralized Bond

Bonds backed by the assets that the issuer puts up as collateral for the issue, such as real estate holdings or equipment. Usually refers to a type of corporate bond.

Collateralized Mortgage Obligation (CMO)

A type of mortgage-backed security that is backed by mortgage pools and that is documented and sold as a collection of separate bonds, which are called tranches.  CMOs may reduce the uncertainties caused by mortgage prepayments by separating cash flows into a variety of tranches.  Each tranche can have different prices, yields, expected maturities, expected prepayment speeds, and so on.

Commercial Paper

Short term, unsecured promissory notes issued by corporations and due in 270 days or less.  Commercial paper proceeds must be used to finance current transactions such as operating expenses, receivables and inventories.

Compound Accreted Value

The value of a zero coupon bond at any given time, based on the principal, with interest compounded at a stated rate of return.

Constant Maturity

Yields on Treasury securities at "constant maturity" are interpolated by the U.S. Treasury from the daily yield curve. This curve, which relates the yield on a security to its time to maturity, is based on the closing market bid yields on actively traded Treasury securities in the over-the-counter market. These market yields are calculated from composites of quotations reported by five leading U.S. Government securities dealers to the Federal Reserve Bank of New York. The constant maturity yield values are read from the yield curve at fixed maturities, currently 3 and 6 months and 1, 2, 3, 5, 7, 10, 20, and 30 years. This method provides a yield for a 10-year maturity, for example, even if no outstanding security has exactly 10 years remaining to maturity. In estimating the 20-year constant maturity, the Treasury incorporates the prevailing market yield on an outstanding Treasury bond with approximately 20 years remaining to maturity.

Convertible Bond

A corporate bond, usually junior or subordinated debenture, that can be exchanged for shares of the issuer's common stock at a specified exchange ratio and price.

Convexity

The second derivative of a bond's price with respect to its yield, divided by its price. This number, when used with modified duration, provides a more accurate approximation of the percentage price change resulting from a specified change in a bond's yield than does modified duration alone. Convexity is the price measure of how much a bond's price/yield curve deviates from a straight line (measure of the degree of curvature of the price/yield relationship). Generally, bonds with a positive convexity are noncallable. In a falling interest rate environment, their price will rise more than it would fall. Examples of bonds with a negative convexity are mortgage backed and callable bonds.

Corporate Bonds

Debt obligations issued by private or public companies to raise funds for a variety of corporate purposes such as building a new facility, purchasing equipment, or expanding the business.

Coupon

Usually refers to a security's stated interest rate. Coupons are generally paid semiannually.

Covenants

Provisions in a debt agreement or indenture stating the rights and duties of the issuer.  Affirmative covenants requires the issuer to perform certain acts such as to maintain coverage of fixed charges at or above certain levels.  Negative covenants require the issuer to refrain from certain acts such as increasing debt above certain levels.

CPI-U

The unseasonably adjusted U.S. City Average All Items Consumer Price Index for All Urban Consumers, published by the Bureau of Labor Statistics. This is used to determine the index ration for U.S. Treasury Inflation Indexed Securities.

Credit Rating (see Rating)

Current Income

Money paid during the period that an investment is held: bonds pay interest, and stocks pay dividends.

Current Yield

The rate of actual cash flow as percent of the purchase price. It is calculated by dividing the annual interest received on the bond by the purchase price. e.g.. a bond with a coupon of 4.5% purchased at 96.625% of par has a Current Yield of 4.66% (45 / 966.25).

Cushion Bond

A bond that is not as sensitive to interest rate fluctuations because of its early call option, usually 1-2 years. Its price is artificially suppressed because of the early call, and will not change up or down as other similar bonds with longer call dates..

CUSIP

A nine digit identifier number for a security that is used to maintain a uniform method of identifying municipal, corporate, and U.S. Government securities.

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Dated Date (or Issue Date)

The date of a bond issue from which interest starts accruing. The bondholder is entitled to receive interest from the issuer starting from this date even though the bonds may actually be delivered on a later date.

Debenture Bond

Corporate bonds that are backed by the overall financial condition and pledge of a company issuing the bond. Since there is no collateral, these bonds generally carry a higher risk, and therefore a higher rate of return, when compared to a collateralized bond.

Defeasance

A technique or procedure whereby an issuer of debt discharges its debt prior to maturity. A trust is established and funded with risk-free monetary assets and with a cash flow matching that of the defeased obligation.

Denomination

The face amount of a security. Bonds are usually issued in denominations of $1,000 or $5,000, or multiples thereof.

Default

Failure to pay principal or interest promptly when due.

Discount

The difference between a bond's current market price and its face, or redemption, value.

Discount Rate

The rate of interest charged by the Federal Reserve Banks on money borrowed from it by its member banks.

Diversification

The practice of including in a portfolio different types of assets in order to minimize risk or to improve overall portfolio performance. An example is to include bonds of different issuers, differing maturities, and differing credit qualities in one portfolio.

Double-Barreled Bond

A municipal bond that is secured by a combination of a general obligation tax pledge and specified revenues.

Double Exemption

Securities, usually tax-free municipal bonds, that are exempt from state income tax as well as federal income taxation. Many states exempt interest earned on bonds issued by political subdivisions within their state from state income taxes.

Duration

Duration A mathematical measure (Macaulay method) of how quickly an investor recovers his or her investment. Bonds of similar duration will have the similar price movements for a given move in interest rates. The resulting figure is a measure of the volatility risk associated with owning the bond. If a bond's duration is 4.5 years, the price of the bond will fall 4.5% for a 1% rise in interest rates. Effective Duration takes into account any calls, puts, or other options of the security. Modified Duration does not take these into account.

Dutch Auction

A system in which a seller gradually lowers his price until a bid is met by the purchaser. Treasury bills are sold in this manner.

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Effective Duration (See Duration)

Escrowed Bonds

Bonds which are paid from monies and securities that are placed in an escrow account and held and paid by a trustee, rather than by an issuer. (See Advance Refunding, Defeasance, Prerefunded).

Eurobond

Bond denominated in U.S. dollars or other currencies and sold in countries other than the one in whose currency the issue is denominated.  The Eurobond market is an important source of capital for multinational corporations and foreign governments, including Third World governments.

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Federal National Mortgage Association (FNMA)

Also known as "Fannie Mae". A U.S. government sponsored private corporation authorized to purchase and sell home mortgages. FNMA facilitates the orderly operation of the secondary market for these mortgages.

 

Federal Home Loan Mortgage Corp (FHLMC)

Also known as "Freddie Mac". A federally created corporation that facilitates the financing of single-family residential housing by creating and maintaining an active market for conventional home mortgages.

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General Obligation (GO) Bonds

Municipal bonds backed by the full faith and credit (taxing and borrowing power) of the municipality issuing the bonds.

Government National Mortgage Association (GNMA)

(Also referred to as "Ginnie Mae"). An agency of the federal Department of Housing and Urban Development empowered to provide assistance in financing home mortgages. GNMA is responsible for management and liquidation of federally owned mortgage portfolios, and issues bonds that are secured by single family mortgages, and guaranteed by the full faith and credit of the U.S. Government.

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Hedge

To offset investment risk in a particular security by another investment or transaction in another market. A long position in a bond may be hedged with a put on those bonds.

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Indenture

A legal document that specifically states the conditions under which a bond has been issued, the rights of the bondholders, and the duties of the issuing corporation.

Index Ratio

For U.S. Treasury Inflation Indexed Securities, the reference CPI-U applicable to the current date, divided by the Reference CPI-U for the original issue date.

Index Ratio

Offered by the U.S. Treasury, these bonds are direct obligations of the United States Government. The principal and interest are protected against inflation by indexing to the Consumer Price Index. Since the principal grows with inflation, the investor is guaranteed that the real purchasing power will keep pace with the rate of inflation, based on the Reference CPI-U. Interest is also protected from inflation because the investor receives interest payments based on a fixed semiannual interest rate applied to the inflation-adjusted principal amount.

Institutional Investor

An organization investing in securities for the benefit of others. Insurance companies, pension funds, investment managers and mutual funds are institutional investors.

Insured Bonds

Many municipal bonds are backed by municipal bond insurance that is specifically designed to reduce investment risk. In the event of a Default, the insurance company guarantees payment of principal and interest to the investors for as long as the Default lasts. Most insured bonds carry the highest quality credit rating -AAA.

Interest

Compensation paid to a lender (investor) by the borrower (issuer of bonds) for the use of money. Usually expressed as an annual percentage rate, and most often paid semiannually, or twice a year.

Investment Grade

Bonds graded Baa and higher by Moody's Investors Service and Fitch Investors Service, or BBB and higher by Standard and Poor's are considered to have only minor speculative characteristics. These are considered to have a high probability of being paid and are considered "investment grade."

Issue Date (see Dated Date)

The date of a bond issue from which interest starts accruing. The bondholder is entitled to receive interest from the issuer starting from this date even though the bonds may actually be delivered on a later date.

Issuer

The entity that borrows money through the issuance of bonds. This can be a state, political subdivision, agency or authority in the case of municipal bonds, a corporation for corporate and Agency bonds, and the U.S. Government for Treasury Bonds.

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Junk Bond

A bond rated lower than Baa/BBB. Also called a high yield bond. Bonds with credit ratings below Baa/BBB are considered speculative compared with investment grade bonds. (See Investment Grade).

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(empty)

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Laddered Portfolio

A common strategy for investing in bonds is to build a varied portfolio with different maturities, usually staggered evenly over time to provide regular cash flow. For example, you might invest $100,000 in equal amounts of $10,000 that mature in each of ten years. As your principal comes due, you reinvest the amount to mature in ten years. Because funds become available for reinvestment each year, this smoothes out the effects of interest rate fluctuations: if interest rates rise, you invest your principal at higher rates; if rates fall you still have most of your portfolio invested in longer term, higher rate bonds.

 

Legal Opinion

An opinion by legal counsel concerning the validity of a securities issue with respect to conformity to statutory authority, and constitutionality, and usually as to the exemption of interest from federal income taxation.

Limited Tax Bond

A bond that has pledged to the repayment of principal and interest, certain taxes or categories of taxes that have a limit on the rate or amount.

Liquidity

The measure of the ease or difficulty with which securities can be bought and sold in the markets. Bonds that have many buyers and sellers, or "market - makers" and a readily available price are considered highly liquid.

Long Bond

The 30 year US Treasury Bond is the longest bond issued by the government. It is also the most widely traded bond in the world. It is viewed as a benchmark in the industry and is commonly called the "long bond."

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Macauley Duration (see Duration)

A mathematical measure (Macaulay method) of how quickly an investor recovers his or her investment. Bonds of similar duration will have the similar price movements for a given move in interest rates.

Maturity (or Maturity Date)

The date when the principal amount of a security becomes due and payable. An issue can have multiple maturities.

Marketability

A measure of the ease or difficulty with which a security can be resold in the market.

Modified Duration (See Duration)

Money Market Funds

Where borrowing and lending for periods of less than one year takes place. Securities and other instruments traded in the money markets include federal funds; certificates of deposit; repurchase agreements; Treasury bills; commercial paper; and bankers acceptances.

Moral Obligation Bond

A revenue bond that, in addition to repayment from its primary source of security, carries an implied, but not legal, obligation for a state to make up shortfalls in a debt service reserve fund. Market participants recognize that failure to make good on this pledge will damage the state's own creditworthiness.

Mortgage-Backed Bonds

Bonds secured by pools of mortgages.

Municipal Bond

A general term referring to securities issued by states and local government agencies such as cities, towns, counties, and special districts. A primary feature of these securities is that interest on them is generally exempt form federal income taxation and, in some cases, state income taxation. Because of this feature, the interest rates on municipal bonds are lower than interest rates on other types of bonds, but when taking into account one's income taxes, often provide a comparable, or better, rate of return.

Municipal Lease

An obligation by a municipal agency to lease equipment or property. The lease payments usually include a component for repayment of principal and an component for interest. The interest component is usually tax-free (exempt from federal, and sometimes state, income taxation). (See Lease/Purchase).

Municipal Notes

Short term obligations, including tax/revenue/bond anticipation notes (TANS/RANS/BANS) of a municipal agency that are sold in anticipation of tax receipts, an upcoming bond issue, or other revenues.

Municipal Securities Rulemaking Board (MSRB)

The self-regulatory body of the municipal securities markets.

Mutual Fund

A pool of investment capital from people who share the same investment goals. Mutual funds made up of bonds do not have a fixed maturity date. The manager of a bond fund continuously buys and sells securities in an effort to maintain the best overall returns for the investors.

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New Issue Market (Primary Market)

A bond offering sold for the first time, also called the primary offering.

 

Non-callable Bond

A bond that does not have an option to be redeemed prior to its stated maturity.

Notes

A security similar to a bond but with a shorter term, usually five years securities. Municipal notes often are secured by specific sources of future revenues such as tax receipts or bond proceeds.

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Offering Date

The date on which a new offering of stocks or bonds will be available to the public.

 

Offering Price

The price, and corresponding yield in the case of bonds, at which an underwriter of securities offers them to investors.

 

Official Statement

Document prepared by an issuer of municipal securities that gives details of the security and financial information for an issue. Much like a prospectus for stocks.

Original Issue Discount

A bond offered at a dollar price less than par (100%) which qualifies for special treatment under federal tax law. For tax-exempt municipal bonds, the difference between the issue price and par is treated as tax-exempt income rather than as a capital gain, if the bonds are held to maturity.

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PAC

"Planned Amortization Class." A CMO tranche with a planned amortization schedule similar to that of a sinking fund.  Principal payments of a CMO are first made to the PAC bonds, as per the schedule, then to other tranches. The weighted average life of the PAC remains constant within a wide band of prepayment speeds for the collateral.  Also called "Planned Redemption Obligation" (PRO) and "Scheduled Redemption Obligation" (SRO).

 

Par Value

The principal amount of a bond or note that is payable at maturity. The par value is the amount on which interest payments are calculated.

 

Pass-through

Securities representing interests in pools of assets such as mortgages and automobile receivables. The interest and the principal payments on the underlying collateral are "passed through" to the security holders.

 

Paying Agent

The place or company where the Principal and Interest are payable - usually a bank or designated office of the Issuer.

 

Preliminary Official Statement

The document prepared by or for a municipal securities issuer that gives in detail the security and financial information about the issue. The Preliminary Official Statement includes all relevant material except the interest rates and prices for the securities, and is made available to prospective investors prior to the setting of the rates and prices.

 

Prepayment

The unscheduled payment of principal on a debt before it is due.

 

Premium

The amount by which a bond sells above its par (face) value.

Price

Bonds are quoted either in terms of a percentage of par value (98 bid/99 offered) or in terms of yield to maturity (7.25% bid/7.50% offered).

 

Price to Call

Price to Call is the price of the bond, expressed as a percent, to the Call Date, at the Call Price.

 

Primary Market (see New Issue Market)

The market on which newly issued securities are sold. This includes the auction market for government bonds and the underwriting period for bonds which an underwriter purchases for resale to investors.

 

Principal

The face amount or par value of a bond. The principal amount of a trade is the par value of one bond times the number of bonds involved in the trade.

 

Putable Security

Security that allows its holder to redeem it, before maturity, at specified intervals at a specified price (usually par).

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(empty)

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RAN

See Municipal Notes

 

Rating

Designations given by investors' services to indicate the relative credit quality, or the strength of the ability to pay.

 

Redemption

The paying off or buying back of a bond by the issuer.

 

Refunding Bond

The replacement of a bond issue with a new bond issue. Usually a new bond issue will refund an outstanding issue to achieve conditions more favorable to the borrower (issuer), such as reduced interest rates or more favorable borrowing conditions.

 

REMIC

Real estate mortgage investment conduits. Similar to a CMO, REMICs qualify for more favorable tax and accounting treatment for the issuer.

 

Registered Bond

A form of ownership of a bond whereby the name of the owner as to principal and interest is recorded on the bond certificates and on the books of the corporation or its agent. A registered bond can be transferred only by endorsement of the registered owner or its agent.

 

Repurchase Agreement

Also called repos, or RPs, these are agreements between a buyer and seller of securities whereby the seller agrees to repurchase the securities at a stated price and stated time.

 

Retail Investor

The term given by the securities industry to individual investors, and sometimes smaller companies, that invest in bonds.

 

Return on Investment (See Total Return)

Revenue Bond

A municipal bond that is secured and repaid only from a specified stream of non-tax revenues. Examples of revenues include tolls, utility charges, charges and use fees from a facility being constructed with the proceeds of a bond issue, such as a sports facility.

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Secondary Market

The market for securities that have previously offered or sold

 

Settlement Date

The Settlement Date is the date on which the transaction settles.

 

Sinking Fund Bond

Issuers of bonds are sometimes required to deposit money into a "sinking fund" with a trustee to be used to redeem a bond prior to its stated maturity date, or to repay principal at maturity. Usually applies to corporate bonds.

 

Special Obligation Bonds

A bond secured by a special tax or other source of revenue, such as a gasoline tax.

STRIPS

Acronym for the U.S. Treasury zero coupon program standing for Separate Trading of Registered Interest and Principal of Securities. These securities are sold at a discount and redeem for their full face value at maturity. They are offered in amounts of $1,000 or more, and pay no interest (the interest is reinvested over the life of the security. STRIPS and zeroes are well suited to such long-term goals as college planning and retirement savings.

Swap

The sale of a bond or block of bonds and the purchase of another of similar or nearly similar market value. Swaps are done to achieve many goals, including: establishing a tax loss; upgrading Credit Quality; extending or shortening the time to Maturity.

Syndicate

A group of underwriters and distributors of a bond issue.

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TAC Bond

"Targeted Amortization Class" bond. Like a PAC bond except that the principal-balance schedule uses a narrower band of collateral prepayments.

 

 

Tax-Free Bonds

Also known as municipal bonds. The interest on these bonds is exempt from federal income taxation.

 

Taxable Equivalent Yield

The interest rate which must be received on a taxable security to provide the holder with the same after-tax return as that earned on a tax-exempt (municipal) security.

 

Taxable Bond Fund

Mutual funds that invest primarily in corporate bonds to provide a high level of current income.

 

Term Bond

A bond issued with a single maturity. Corporate term bonds typically have no provision for a periodic redemption of principal; in other words, the entire amount falls due at the same time. Municipal Term Bonds usually include a sinking fund for the periodic redemption of a portion of the term bond.

 

Total Return

Return on investment, taking into account capital appreciation, dividends or interest, and individual tax considerations. The total return is usually adjusted for present value and expressed on an annual basis.

 

Trade Date

The date on which a bond transaction takes place. This is often earlier than the Settlement Date.

 

TRAN

See Municipal Notes

Tranche

Also "class." Part of a CMO or asset-backed security. Each tranche has the same documentation as the deal itself but offers different terms. For example, one tranche might offer a maturity of five years, a second tranche might offer floating-rate options, a third might offer compounded interest, and so on.

From an Old French word meaning "to cut."

Treasury Bills (T Bills)

A U.S. Government security with a maturity of one year or less. T Bills are purchased at a discount to the full face value and the investor receives the full value when they mature. The difference, or "discount" is the interest earned. T Bills are issued in denominations of $10,000 and $1,000 increments thereafter.

 

Treasury Notes

U.S. Government obligations that are available for terms of 1 to 10 years. Interest is paid twice a year, or semiannually, and they can be purchased in denominations of $1,000 or multiples thereof.

 

Treasury Bonds

Trustee

A bank that is designated by an issuer of bonds that acts as the custodian of funds and official representative of the bondholders. Trustees are appointed to assure that bondholders have representation to enforce the contractual obligations of the issuer.

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Underwriter

Unit Investment Trust (UIT)

Unlimited Tax Bond

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Variable Rate Bond

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When Issued

A bond issue that has been offered for sale, but has not yet been delivered by the issuer, is considered to be trading on a "when issued" basis. Also known as "when, as, and if, issued".

 

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Yankee Bond

A dollar-denominated bond of a foreign issuer registered with the SEC and sold in the U.S. In everyday practice, non-dollar denominated bonds of foreign issuers sold in the U.S. are also included in the Yankee bond category.

Yield

This is the basis on which a bond is priced and sold. It reflects the value of the bond giving consideration to the length of time to Maturity, credit quality of the Issuer/guarantor, and general market conditions.

 

Yield to Call

Yield to Call is the yield on the bond to the Call Date, at the Call Price.

 

Yield to Maturity

A yield concept designed to give an investor the average annual yield on a security. It is based on the assumption that the security is held by the investor until final maturity, and that all interest received can be reinvested at the yield to maturity.

 

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Zero Coupon Bond

Zero Coupon Bonds do not pay Interest prior to Maturity. The investor receives one payment - at Maturity. However, Interest is accrued and compounded semi-annually at the original interest rate to Maturity. Zero Coupon Bonds are often callable at their Accreted Value on a particular Call Date.

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