What does an indenture provide for bondholders?

An indenture plays a crucial role in defining the terms and conditions under which bonds are issued and serves as a formal agreement between bondholders and the issuer. Specifically, it outlines the rights of bondholders, which can include the right to receive interest payments, the right to claim assets in the event of liquidation, and any legal restrictions that may apply to the bondholders or the issuer.

This legal document is essential as it protects the interests of bondholders by providing clarity on various aspects, such as the obligations of the issuer and the remedies available to bondholders if those obligations are not met. While aspects like accrued interest, stock prices, and maturity dates may be referenced within the indenture, the primary purpose of the document is to establish the rights and legal bindings between the involved parties, making option B the most accurate choice.