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The correct option is A: indenture. All protective and limiting covenants granted to bondholders are spelled out in the trust indenture. The trustee monitors the corporation's compliance with the covenants.

An indenture is a legal contract that reflects or covers a debt or purchase obligation. In historical usage, it explicitly referred to the condition of an indentured servant; in modern usage, it refers to a tool employed in commercial debt or real estate transactions. According to the Trust Indenture Act of 1939, public debt offerings in the US that are worth more than $10 million must be made using an indenture of trust. The justification for this is that in order for creditors to be able to collect in a fair, orderly manner in the event of default, it is important to establish a collective action mechanism. Between the bondholder and the issuing company, there is no trust relationship. These two are associated in a customary contractual, impartial, non-equity, and non-fiduciary manner.

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