tag:blogger.com,1999:blog-6321089372587128676.post8560249344493485076..comments2023-10-17T10:01:00.917-04:00Comments on Distressed Debt Investing: Advanced Distressed Investing ConceptUnknownnoreply@blogger.comBlogger4125tag:blogger.com,1999:blog-6321089372587128676.post-17179816781775502332010-03-04T13:50:14.439-05:002010-03-04T13:50:14.439-05:00Very interesting post. I had some experience with...Very interesting post. I had some experience with these issues in the last bankruptcy cycle and my thinking is that most decisions will come down that code rights aren't waivable. <br /><br />The agreements between the 1st and 2nd lien lenders may be useful as negotiating points once bankruptcy arrives, but I would generally put little faith in them as a tool for generating higher returns. <br /><br /> If the code provides an advantage to either party over inter-party agreements, I would assume that party will choose to use code provisions. I simply don't think any creditor will consent to a non-code cramdown unless its enforced by the court, and the record of that, is as you say, spotty. <br /><br /> Perhaps that leaves another cause of action, but the return on that cause would have to be very high for it to be worthy of further investment, I'd think. <br /><br />Could the estate pay for some of it? I admit I don't know.Delveragenoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-86847994171393342562010-03-03T17:42:49.896-05:002010-03-03T17:42:49.896-05:00You're obviously a credit lawyer. I'm abou...You're obviously a credit lawyer. I'm about to join a firm (from a clerkship) and rotate through a credit group. Want to make a good impression. Can you recommend any materials to put me ahead of the pack? Any advice for a newbie?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-49669828724231022922010-03-02T10:29:44.077-05:002010-03-02T10:29:44.077-05:00Great post. I hope buyers of GVR 2nd lien don'...Great post. I hope buyers of GVR 2nd lien don't read this and continue to think they can jam up the first lien lenders.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6321089372587128676.post-91676326494608356102010-03-01T15:33:18.618-05:002010-03-01T15:33:18.618-05:00Thank you very much--very informative.
I am curio...Thank you very much--very informative.<br /><br />I am curious about how you would handicap this risk--i.e., uncertainty about current legal consensus. <br /><br />I can see it going both ways. #1--If a 2nd lien is priced far below the 1st lien, and a given judge is more likely than not to disallow pre-bankruptcy waivers, that would be a boon for the security. Of course, the decision could always be overturned on appeal, right?<br /><br />#2--On the other hand, if the 1st and 2nd lien are priced too closely, and a given judge would likely allow the waivers, that would be a bane.<br /><br />Seemingly sharp analysis could yield an advantage, but ultimately only offer very thin margins, given the uncertainty.<br /><br />Are my perceptions right or wrong? <br /><br />In other words, do such situations (#1 or #2, e.g.) produce investment opportunities in their own right, or more just as an added kicker?Unknownhttps://www.blogger.com/profile/02221344285528614209noreply@blogger.com