Protective covenants:

A) Are primarily designed to protect the issuing corporation from unreasonable demands of bondholders.
B) Are consistent for all bonds issued by a corporation within Canada.
C) Are limited to stating actions which a firm must take.
D) Only apply to bonds that have a deferred call provision.
E) Are primarily designed to protect bondholders from future actions of the bond issuer.

Protective Covenants

Conditions written into financial agreements that the issuer must follow, such as restrictions on issuing more debt or making capital distributions.

Bondholders

Individuals or entities that own bonds issued by corporations or governments, entitling them to receive fixed interest payments and the return of the principal amount at maturity.

Issuing Corporation

A legal entity that generates and offers securities like stocks or bonds to the public to raise capital.