Debt with Endogenous Safety Covenants: Default and Corporate Securities Valuation

摘要：

This paper examines the valuation of corporate securities when the capital structure of the firm includes debt contracts with safety covenants based on endogenous quantities. Debt indenture clauses examined include those giving debtholders the right to demand immediate repayment of the debts face value if the endogenous equity price falls below a prespecied threshold. Trigger covenants of this kind are found to have surprising effects on the valuation and the behavior of equity.

关键词： Safety covenants equity-trigger equity value optimal repayment time debt value endogenous constraints dividend-paying assets private placements

作者: Jérome Detemple Weidong Tian

作者单位: Boston University School of Management, 595 Commonwealth ave., Boston, MA, 02215 University of Waterloo

会议类型: 国际会议

会议名称: 2007年中国金融国际年会

会议地点: 成都

会议语种:英文

页码: 1-31

在线出版日期: 2007-07-09（万方平台首次上网日期，不代表论文的发表时间）