Abstract
Small firms that do not have access to organized financial markets must often rely on secured commercial loans for their debt financing. In large firms, debt-related agency problems are often resolved through the bond pricing process in the formal debt markets. When these same debt-related agency problems arise in small, private firms, the structure of the secured lending agreement must resolve these problems. This study identifies debt-related agency problems as they exist in private firms and examines howf the lending agreement resolves these problems.
JEL Codes
L25, G32
Keywords
Asset Based Lending, ABL, Agency Problem
Recommended Citation
Constand, Richard L.; Osteryoung, Jerome S.; and Nast, Donald A.
(1991)
"Revolving Asset-Based Lending Contracts and the Resolution of Debt-Related Agency Problems,"
Journal of Small Business Finance:
Vol. 1:
Iss.
1, pp. 15-28.
DOI: https://doi.org/10.57229/2373-1761.1109
Available at:
https://digitalcommons.pepperdine.edu/jef/vol1/iss1/3
