Charlie Chicken Restaurants Announced It Plans to Issue $300 Million

Charlie Chicken Restaurants announced it plans to issue $300 million in debenture bonds to fund the expansion of its fast food chain of restaurants. In financial terms, this means

A) the corporation will borrow $300 million worth of long-term financing. The bond issue will not carry any collateral.
B) the corporation will issue $300 million worth of equity financing. The bond issue will be backed by the property and buildings purchased with the funds.
C) the corporation will borrow $300 million worth of long-term financing. The issue will be backed by the property and buildings purchased with the funds.
D) the corporation will issue $300 million worth of interest-free bonds. Financiers will be paid from the revenues created by the individual franchises.

Correct Answer:

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