What challenges may arise during negotiation in restructuring?

Negotiation during restructuring often encounters various complexities, one of the most significant being the conflicting interests among creditors and the potential for litigation. In a restructuring scenario, different creditors may have varying priorities regarding the recovery of their investments, which can lead to disagreements on how assets should be distributed or how business operations should continue.

For instance, secured creditors, who have collateral for their loans, might push for more favorable terms than unsecured creditors, who have no such guarantees. This disparity can create tension and hinder the negotiating process, as each group advocates for its own interests. Furthermore, if negotiations break down, parties may resort to litigation to resolve their disputes, adding further delay and complications to the restructuring effort.

The other options do not accurately reflect the complexities inherent in restructuring negotiations. Complete agreement among all parties is often unrealistic given the differing interests. Immediate access to financing is usually a challenge in itself during a restructuring, rather than a certainty. Lastly, uniformity in all creditor demands is also unlikely, as creditors typically have unique positions and expectations based on their individual agreements and the nature of their claims.