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L

Laddered Portfolio - A portfolio in which the same quantity of bonds mature each year over a specified time period or maturity range.

Legal Opinion - A written statement by recognized counsel affirming the legal validity of a municipal bond; it must either be printed on or attached to the bond.

Letter-of Credit - A security document usually issued by a bank that backstops, or enhances, the basic security backing the bond.

Letter-of Credit Bond - A bond secured by a bank letter of credit obligating the issuing bank to pay sums at such times as are required to permit the retirement of the bond.

Lien - A creditor's claim against property. A junior lien is a lien that is outranked by another lien. A senior lien is an interest in property having priority over other interests as to payment, not necessarily an interest which has existed longer than others.

M

Mandatory Redemption - The requirement that the issuer call outstanding bonds based on a predetermined schedule or as provided in the bond contract.

Mandatory Sinking Fund - A requirement to redeem a fixed portion of term bonds, which may comprise the entire issue, in accordance with a fixed schedule. Although the principal amount of the bonds to be redeemed is fixed, the specific bonds called to satisfy the requirement are selected by the trustee on a lot basis.

Maturity - (or Maturity Date) The date on which the principal of a municipal security becomes due and payable to the security holder.

Maturity Date - The stated date on which all or a stated portion of the principal amount of a security is due and payable.

Moral Obligation Bond - A type of municipal security, issued by a state agency, that is not backed by the full faith and credit of a state. State law may provide that the agency request an appropriation from the legislature to replenish the issuer's debt service reserve fund if a shortfall occurs.