The article introduces a new model for valuing corporate bonds and credit default swaps using equity as a key factor. This model avoids restrictive assumptions about a company's financial structure and represents default as the equity value dropping to zero. Default can be predicted through a process that considers the likelihood of gradual default, or it can happen unexpectedly through sudden jumps. This approach allows for easier hedging across different assets and enables better management of credit risk, including the risk of sudden defaults.