What are the conditions imposed on a debt issue that are designed to protect bondholders called?
A)collateral agreements
B)common restrictions
C)protective covenants
D)default provisions

Question

Quizplus · Accepted Answer

Protective covenants are conditions imposed on a debt issue that are designed to protect bondholders. These covenants may include restrictions on the issuer's ability to take on additional debt, sell assets, or pay dividends, among other things. The goal is to give bondholders some level of assurance that their investment is safe and that the issuer is likely to be able to repay the debt when it comes due.

What Are the Conditions Imposed on a Debt Issue That