A theory of mandatory convertibles: distinct features for large repeated financing
本文首次用不完全契约理论分析强制性可转换债券，证明其在大规模重复融资中能提高效率，并解释了强制转换、高股息率等独特特征的设计逻辑。
In recent years, mandatory convertibles (MCs) have become a popular means of raising capital, especially for large projects. This paper is the first theoretical paper to investigate MCs using the incomplete-contract approach. We show that MCs can be an efficient instrument in sequential financing. MCs have some distinct features compared to other convertibles, such as mandatory conversion, a high dividend rate, and capped capital appreciation. We show in theory that these features are designed to achieve efficiency.