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Bond Covenant

   Also found in: Encyclopedia 0.01 sec.
Bond covenant
A contractual provision in a bond indenture. A positive covenant requires certain actions, and a negative covenant limits certain actions.

Bond Covenant
An agreement between the issuer and holder of a bond, requiring or forbidding certain actions of the issuer. Positive covenants require actions while negative covenants forbid them. The exact terms of a bond covenant must be written in the bond indenture.


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Hammerson, the country's fourth-largest property company, will raise pounds 580m and warned that without extra funding it was likely to breach the terms of its bank and bond covenants.
While the Turnpike Authority has imposed scheduled toll increases every six years to meet those Big Dig bond repayment increases since the late 1990s, a new toll hike in January would come five years before the current bond covenants require the next scheduled toll increase.
A recent joint publication, issued by the National Association of Bond Lawyers and the Government Finance Officers Association, offers a suggested post-issuance compliance check list to adhere to minimum IRS and related bond covenant requirements at www.
 
 
 
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