Corporate Finance Law

This course explores a fundamental question for business organizations: how does a firm raise money to finance its operations? Topics include the time value of money, valuation of bonds and stocks, portfolio theory, market efficiency, and theories of capital structure. Particular attention will be given to understanding a firm s choice of capital structure (i.e. the mix of common stock, preferred stock, debt, options, and other convertible instruments) and the legal rights these financial instruments create. We will spend a significant portion of the class working through the contractual provisions and other legal rights associated with (i) a debt financing contract, and (ii) an equity investment through preferred stock.

Prerequisite: Corporations (B653) or permission of the instructor. No prior background in finance is required. However, a willingness to work through some numerical problems will be valuable.