Shares of Evergrande rose over 1% on Wednesday, while its defaulted dollar bond due April 2022 dropped to 16.358 cents on the dollar from 17.074 overnight, according to data by Duration Finance. Rating agency Moody's said in a report on Wednesday that covenant packages in Evergrande's offshore issuances had become increasingly lax, loosening or eliminating key protections, and putting the recovery prospects for offshore bondholders in peril. Offshore bondholders rank behind the creditors of Evergrande's over 1,950 onshore subsidiaries, Moody's added, and none of which guarantee the offshore bonds. The agency said the weakened covenants and increased size of debt carve-outs have allowed the firm to increase leverage materially.