generally receive fixed payments regardless of how the firm does, while $q,$ earn higher returns when the firm's earnings are higher. Investments in $$ ventures, that have great payoffs to stockholders if successful but threaten bankruptcy if they fail, create conflicts. In addition, the use of additional $q,$ increases stockholder$-$ debtholder conflicts. Consequently, bondholders attempt to protect themselves by including $|$ in bond agreements that limit firms' use of additional and constrain $-$Selectactions. $$