Open Access. Powered by Scholars. Published by Universities.®

Jurisprudence Commons

Open Access. Powered by Scholars. Published by Universities.®

Law and Economics

1984

Articles 1 - 1 of 1

Full-Text Articles in Jurisprudence

The Economics And Jurisprudence Of Convertible Bonds, William W. Bratton Jan 1984

The Economics And Jurisprudence Of Convertible Bonds, William W. Bratton

Faculty Scholarship at Penn Law

Professor Bratton examines judicial regulation of issuer-bondholder conflicts of interest within three different, but closely related doctrinal frameworks: neoclassical contract interpretation; contract avoidance; and corporate law fiduciary restraint. After discussing the elements of convertible bond valuation and their interaction with issuer actions giving rise to conflicts of interest, he evaluates the case for judicial intervention to protect bondholder interests. He concludes that ·bondholder protective intervention is fair and tolerably efficient, provided it is kept within the bounds of contract interpretation. But he finds that more aggressive judicial intervention under the frameworks of contract avoidance and fiduciary restraint carries an unnecessary ...