Explain why holders of a firms debt should insist on a covenant that restricts the amount of

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Explain why holders of a firm’s debt should insist on a covenant that restricts the amount of cash dividends the firm pays.

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Fundamentals of corporate finance

ISBN: 978-0470876442

2nd Edition

Authors: Robert Parrino, David S. Kidwell, Thomas W. Bates

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Question Posted: Jun 12, 2012 01:18 AM

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Explain why holders of a firms debt should insist on a covenant that restricts the amount of

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We have to remember that any cash paid to shareholders reduces the amount ...View the full answer

Fundamentals of corporate finance

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