A Covenant, in general, is a promise undertaken by a company to its lenders or bondholders. Covenants are either operational or financial. This dissertation focuses mainly on financial covenants, which are commonly included in bonds and loan agreements in order to safeguard creditors' interest....

Corporate debt maturity is a concave function of financial leverage when the debt has restrictive asset-based covenants attached. This concavity kicks in earlier with increasing covenant tightness and is absent when firms have no restrictive asset-based covenants. We argue that this concavity is...

I develop a dynamic capital structure model in which shareholders determine a firm's leverage ratio, debt maturity, and default strategy. In my model, the firm's debt matures all at once. Therefore, after repaying the principal shareholders own all the firm's cash flows and can pick a new...

In this study, we examine the impact of fair value accounting on corporate debt structures, i.e., debt conversion privilege and maturity term. We argue that fair value accounting affects agency conflicts between debtholders and shareholders via its impact on financial reporting quality....

This study examines the influence of a firm's geographical location on corporate debt and provides evidence that the higher cost of collecting information on firms distant from urban areas has significant implications on a wide array of corporate debt characteristics. We find that rural firms...

What determines the maturity structure of debt? In this article, I develop a simple model to explore how the optimal maturity of debt issued by a firm (or a country) depends both on the firm’s cyclical state and other features of the economic environment in which it operates. I find that...

This paper investigates whether firm managers time debt issuances according to market liquidity conditions. Using transactions data in the U.S. market from July 2002 to December 2009, our results show that both the moment and volume of debt issuance are significantly associated with periods of...