We examine seasoned offerings of common stock and stock-warrant units to test predictions of recent theories of security issuance based on sequential financing and information signaling. We specify and test a simultaneous equations model involving the choice of shares versus stock-warrant units...

Theories suggest that stock-warrant units are used as mechanisms for reducing agency costs or signaling firms' good future prospects as a form of sequential equity financing. While there is evidence of less severe price reaction to unit seasoned equity offering announcements than to share...

Using a stochastic volatility option pricing model, we show that the implied volatilities of at-the-money options are not necessarily unbiased and that the fixed interval time-series can produce misleading results. Our results do not support the expectations hypothesis: long-term volatilities...

Project finance links financial structure to the operational characteristics of the project to optimize the allocations of various project risks. We develop a model in which concession grants and offtake agreements benefit both the public and the private sponsor in the presence of political...

I develop a hypothesis that predicts nonlinear patterns of leverage and cash holdings over firms' financial flexibility demand stages. The hypothesis also predicts distinctive financing patterns over the financial flexibility demand stages. The empirical results support the hypothesis:...

We find that, in the presence of the “flight to quality” during the 2007-2008 financial crisis, firms that depended less on external financing (or internal finance dependent firms) prior to the crisis were able to secure additional financing and increased investments, while external finance...

This paper examines debt-free firms. We find that favorable equity market valuation and borrowing constraints contribute to these firms' extreme debt conservatism. Small debt-free firms with little access to credit markets are seen to raise equity while paying high dividends. Large debt-free...

If firms adjust their capital structures toward targets, and if there are adverse selection costs associated with asymmetric information, how and when do firms adjust their capital structures? We suggest a financing-needs-induced adjustment framework to examine the dynamic process by which firms...

Theories suggest that stock-warrant units are used as mechanisms for reducing agency costs or signaling firms' good future prospects as a form of sequential equity financing. While there is evidence of less severe price reaction to unit seasoned equity offering announcements than to share...

We examine seasoned offerings of common stock and stock-warrant units to test predictions of recent theories of security issuance based on sequential financing and information signaling. We specify and test a simultaneous equations model involving the choice of shares versus stock-warrant units...