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| Foreword | |
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| Preface | |
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| Acknowledgments | |
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| The General Landscape of Distress Investing | |
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| The Changed Environment | |
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| Trends in Corporate Debt Growth and Leverage before the Financial Meltdown of 2007-2008 | |
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| Junk Bonds and the Levering-Up Period | |
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| The Syndicated Loan Market and Leveraged Loans | |
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| Financial Meltdown of 2007-2008 | |
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| Principal Provisions of the 2005 Bankruptcy Act as They Affect Chapter 11 Reorganizations of Businesses | |
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| The Theoretical Underpinning | |
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| What Market? | |
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| Toward a General Theory of Market Efficiency | |
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| External Forces Influencing Markets Explained | |
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| What Risk? | |
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| Capital Structure and Credit Risk | |
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| Valuation | |
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| The Company as a Stand-Alone Entity | |
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| Control and Its Vital Importance | |
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| The Causes of Financial Distress | |
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| Lack of Access to Capital Markets | |
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| Deterioration of Operating Performance | |
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| Deterioration of GAAP Performance | |
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| Large Off-Balance-Sheet Contingent Liabilities | |
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| Deal Expenses and Who Bears Them | |
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| Attorneys and Financial Advisers' Compensation Structure and the Distribution of the Fee Pie | |
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| Time in Chapter 11 and Number of Legal Firms Retained | |
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| Determinants of Legal Fees and Expenses | |
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| Determinants of Financial Advisers' Fees and Expenses | |
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| Can Professional Costs Be Excessive? | |
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| Appendix | |
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| Other Important Issues | |
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| Management Compensation and Entrenchment | |
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| Tax and Political Disadvantages | |
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| The Five Basic Truths of Distress Investing | |
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| No One Can Take Away a Corporate Creditor's Right to a Money Payment Outside of Chapter 11 or Chapter 7 | |
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| Chapter 11 Rules Influence All Reorganizations | |
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| Substantive Characteristics of Securities | |
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| Restructurings Are Costly for Creditors | |
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| Creditors Have Only Contractual Rights | |
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| Restructuring Troubled Issuers | |
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| Voluntary Exchanges | |
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| Problems with Voluntary Exchanges | |
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| The Holdout Problem Illustrated | |
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| Making a Voluntary Exchange Work | |
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| Tax Disadvantages of a Voluntary Exchange versus Chapter 11 Reorganization | |
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| A Brief Review of Chapter 11 | |
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| Liquidations and Reorganizations | |
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| Starting a Case: Voluntary versus Involuntary Petitions | |
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| Forum Shopping | |
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| Parties in a Chapter 11 Case | |
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| Administration of a Chapter 11 Case | |
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| The Chapter 11 Plan | |
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| The Workout Process | |
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| Parties and Their Differing Needs and Desires | |
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| Types of Chapter 11 Cases | |
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| Leverage Factors in Chapter 11 | |
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| The Investment Process | |
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| How to Analyze: Valuation | |
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| Strict Going Concern Valuation | |
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| Resource Conversion Valuation | |
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| Liquidation Valuations | |
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| Due Diligence for Distressed Issues | |
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| Distress Investing Risks | |
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| Risks Associated with the Alteration of Priorities | |
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| Risks Associated with Collateral or Enterprise Valuation | |
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| Reorganization Risks | |
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| Other Risks | |
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| Form of Consideration versus Amount of Consideration | |
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| Cases and Implications for Public Policy | |
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| Brief Case Studies of Distressed Securities, 2008-2009 | |
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| Performing Loans Likely to Remain Performing Loans | |
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| Small Cases | |
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| Large Cases | |
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| Capital Infusions into Troubled Companies | |
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| A Small Case: Home Products International | |
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| The Early Years | |
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| Growth by Acquisitions | |
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| Retail Industry Woes | |
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| The Fight for Control | |
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| Amendment of Indenture and Event of Default | |
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| The Decision: Prepackaged Chapter 11 | |
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| Treatment of Impaired Classes under the Plan | |
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| Financial Means for Implementation of the Plan | |
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| Going-Concern and Liquidation Valuations | |
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| A Large Reorganization Case: Kmart Corporation | |
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| Landlords and Unexpired Leases | |
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| Vendors and Critical Vendor Motions | |
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| Management and KERPs Pre-2005 BAPCPA | |
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| Fraudulent Transfers | |
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| Subsidiary Guarantees and Substantive Consolidation | |
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| Chapter 11 Committees and Out-of-Control Professional Costs | |
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| Blocking Positions | |
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| Buying Claims in Chapter 11 | |
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| Debtor-in-Possession Financing | |
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| Kmart's Plan of Reorganization and Plan Investors | |
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| Investment Performance | |
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| An Ideal Restructuring System | |
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| Feasibility and Cash Bailouts | |
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| Good Enough Rather Than Ideal | |
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| Highly Beneficial Elements in the U.S. Restructuring System | |
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| Goals of an Ideal Restructuring System | |
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| Suggested Reforms | |
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| Notes | |
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| About the Authors | |
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| Index | |