Protection for debt holders takes the form of protective covenants in the bond indenture. These covenants place restrictions on which of the following activities?
A) the sale of assets
B) payment of dividends
C) the issuance of additional debt
D) all of the above are typical protective covenants

Question

Quizplus · Accepted Answer

All of the above activities are typical restrictions in protective covenants to protect the interests of the debt holders. The covenants may also include provisions related to the company's operations, such as changes in management, investments, mergers and acquisitions, and financial reporting requirements.

Protection for Debt Holders Takes the Form of Protective Covenants