Yun LouHEC Paris
Department of Accounting and Management Control
1 rue de la Libération
78350 Jouy en Josas
Download my CV here.
Default Clauses in Debt Contracts, Review of Accounting Studies 20 (2015), 1596-1637
(with Ningzhong Li and Florin P. Vasvari)
Abstract: We examine the determinants of events of default clauses in syndicated loan and bond contracts, provi- sions that allow lenders to request the repayment of principal and to terminate lending commitments. We document significant variation in the use of default clauses and their restrictiveness within the same type of lending contract but also across loans and bonds. We find that default clauses in public bond contracts are less restrictive than those in syndicated loan contracts. We also document that two ex ante proxies for bankruptcy costs, the level of intangible assets and capitalized research and development expenditures at the time of debt contracting, are associated with less restrictive default clauses, especially in bond contracts. We conclude that bondholders attempt to mitigate the occurrence of inefficient defaults. Given their inability to coordinate with each other and their ownership of subordinated claims, bondholders incur higher default costs than bank lenders.
Investment, Duration, and Exit Strategies for Corporate and Independent Venture Capital-Backed Start-ups, Journal of Economics & Management Strategy 24 (2015), 415-455
(with Bing Guo and David Perez-Castrillo)
Abstract: We propose a model of investment, duration, and exit strategies for start-ups backed by venture capital (VC) funds that accounts for the high level of uncertainty, the asymmetry of information between insiders and outsiders, and the discount rate. Our analysis predicts that start-ups backed by corporate VC funds remain for a longer period of time before exiting and receive larger investment amounts than those financed by independent VC funds. Although a longer duration leads to a higher likelihood of an exit through an acquisition, a larger investment increases the probability of an IPO exit. These predictions find strong empirical support.
The Role of Reputable Auditors and Underwriters in the Design of Bond Contracts, Journal of Accounting, Auditing & Finance 28 (2013), 20-52
(with Florin P. Vasvari)
Abstract: We empirically test the certification hypothesis by studying the roles of reputable auditors and bank underwriters in the design of bond contracts. The certification hypothesis suggests that reputable capital market intermediaries can credibly communicate inside information to outside investors, thereby helping improve financing terms for firms that raise external funding. Consistent with this hypothesis, we provide evidence that reputable auditors and underwriters help corporate bond issuers obtain lower bond yields. The effect of reputable auditors on the yields is greater than that of reputable underwriters in terms of economic magnitude and significance, consistent with auditors' multiple roles as information intermediaries, monitors, and insurance providers. We also find that the presence of reputable auditors and underwriters affects bonds' nonpricing terms. Firms that hire reputable auditors obtain longer term bonds, whereas those that engage reputable underwriters can issue larger bonds. Taken together, the results suggest that reputable auditors and underwriters have integral, but different, roles in the bond-issuing process.
Shareholder Litigation and Corporate Disclosure: Evidence from Derivative Lawsuits, Revise and resubmit at the Journal of Accounting Research
(with Thomas Bourveau and Rencheng Wang)
Disclosure of Pending Lawsuits and Bond Terms, Revise and resubmit at Management Science
Debt Heterogeneity and Covenants, Revise and resubmit at Management Science
(with Clemens A. Otto)
Accounting Quality and Debt Concentration: Evidence from Internal Control Weaknesses Disclosures
(with Ningzhong Li, Clemens A. Otto, and Regina Wittenberg-Moerman)
Secured Debt and Financial Reporting Quality: Evidence from Anti-Recharacterization Laws
(with Thomas Bourveau and Chris Williams)
Major Government Customers and Loan Contract Terms
(with Daniel Cohen, Bin Li, and Ningzhong Li)
last update: December, 2016