DIP lenders do not negotiate hair cuts. Ever! A Moody's study of 297 bankruptcy cases involving DIP debt showed only two defaults with only one case where a DIP lender lost money (Winstar Communications was liquidated). All the other cases showed full payouts to the DIP lenders. Prior to 2005, DIP debtors could get repeated extensions for filing reorganization plans which could go on for years. In 2005 the law was changed to prohibit any extensions for reorganization that was beyond 18 months from the filing date. After that the DIP lenders lose their exclusivity of superior secured creditors. SUNE's DIP lenders are going to angle for a full payout even if it means a SUNE liquidation.
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