Restructuring Alternatives for High Yield Bonds

Evaluating and Using Exchange Offers and Prepacks to Avoid Bond Default

Recording of a 90-minute CLE webinar with Q&A


Conducted on Wednesday, July 29, 2009

Program Materials

This seminar will examine the restructuring alternatives available for high yield bonds, legal considerations when restructuring, and strategies for choosing and implementing the various alternatives.

Description

High yield bonds have long been a financing source for corporations and in leveraged buyouts. High yield bonds — commonly known in the past as junk bonds — typically pay higher returns than better quality bonds, which make them attractive to investors. However, they carry a higher risk of default.

Moody's predicts that 15% of high yield debt issuers will default this year, compared to a 4% average historically. Because refinancing options are limited in the current economy, issuers are restructuring outstanding bonds to preserve the value of their businesses and avoid bankruptcy.

Restructuring high yield bonds is a complex process involving multiple bondholders, specialized investors and intercreditor issues. Counsel advising issuers should cautiously consider the restructuring alternatives and understand the advantages and legal risks of each.

Listen as a panel of corporate finance and restructuring attorneys examines the restructuring alternatives available for high yield bonds, legal issues to consider in restructuring, and best practices for implementing the various alternatives.

READ MORE

Outline

  1. Restructuring alternatives — benefits, risks, implementation strategies
    1. Exchange offers
    2. Prepackaged plan of reorganization
    3. Prenegotiated plan of reorganization
  2. Legal considerations when restructuring
    1. Impact on issuer’s operations (trade creditors, suppliers, customers)
    2. Court confirmation of prepackaged or prenegotiated plan
    3. Disclosure issues

Benefits

The panel will review these and other key questions:

  • How has the economic downturn impacted issuers of high yield debt?
  • What are the advantages and disadvantages of using exchange offers as a restructuring alternative?
  • How can prepacks be used to restructure defaulting high yield debt?
  • What impact does restructuring have on an issuer's business operations?

Faculty

Paul E. Harner
Paul E. Harner

Partner
Paul Hastings Janofsky & Walker

He focuses on corporate bankruptcy, restructuring and other insolvency-related matters. He has represented debtors,...  |  Read More

Scott R. Saks
Scott R. Saks

Partner
Paul Hastings Janofsky & Walker

He has extensive experience with securities, capital markets and corporate transactions representing underwriters,...  |  Read More

William F. Schwitter
William F. Schwitter

Partner
Paul Hastings Janofsky & Walker

He is Chair of the firm’s Leveraged Finance Practice Group. He has a diversified corporate practice with...  |  Read More

Other Formats
— Anytime, Anywhere

Strafford will process CLE credit for one person on each recording. All formats include program handouts. To find out which recorded format will provide the best CLE option, select your state:

CLE On-Demand Audio

$297