Which of the following are bond provisions commonly used to restrict an issuer's call privilege?
I Deferred Call Provision
II Retractable Provision
III Call Premium Provision
IV Refunding Provision

Question

Quizplus · Accepted Answer

Deferred Call Provision, Retractable Provision, and Refunding Provision are bond provisions commonly used to restrict an issuer's call privilege. The Deferred Call Provision allows the issuer to defer the call option for a certain period of time, while the Retractable Provision allows the bondholders to redeem their bonds at a pre-determined price. The Refunding Provision limits the issuer's ability to call the bonds if they are using the proceeds to refund another debt issue. Call Premium Provision, on the other hand, is not used to restrict an issuer's call privilege but rather determines the amount of the call price that the issuer must pay if they choose to call the bond. Therefore, the correct answer is B, I, III, and IV only.

Which of the Following Are Bond Provisions Commonly Used to Restrict