Decision Case: Improving Debt Ratings Williams Company has decided to issue bonds to raise cash needed for new equipment purchases. Company officials have met with representatives of the well-known investment banking firm Giltman Socks and have roughed out a preliminary description of the terms of the bond issue. The plan is to issue $100 million of subordinated debentures due in 20 years. Because the bonds are expected to be rated Baa by Moody’s (See Exhibit 11-1), Giltman Socks has estimated the bonds will need to yield 10 percent to entice investors to purchase them. Managers at Williams are concerned about the high interest payments and the burden the interest will place on future cash flows. They wonder if steps couldn’t be taken to improve the rating by Moody’s. They estimate that the yield could be cut by | percentage point for each step upwards in the ratings. Outline steps that might be taken to improve the way in which the Williams Company bonds might be viewed by the bond raters and the market.