Several recent papers have documented the benefits of Debtor-in-possession (DIP) financing in the restructuring of firms in Chapter 11. However, the view on benefits is not unanimous and some legal scholars have raised doubts about DIP financing's effects on debt-holders and the possibility of...

This study empirically examines tender and exchange offers for a recent sample of 46 high-yield debt restructurings by financially distressed firms during 1989-1992. We find significant differences between tender and exchange offers. Firms using tender offers appear to be in less financial...

This paper investigates, from both a theoretical and clinical perspective, bond tender offers accompanied by a threat to call nontendered bonds, or so-called STACs. The theoretical analysis explains the use of STACs and derives conditions under which the call threats embedded in STACs are...

This paper investigates the use of debtor-in possession (DIP) financing by firms reorganizing under the protection of Chapter 11. A model is developed in which there is asymmetric information between the creditors of a bankrupt firm and its management. In this context, it is demonstrated that...