Debt exchanges have long been utilized by distressed companies to address liquidity concerns and to take advantage of beneficial market conditions. A company saddled with burdensome debt obligations, for example, may seek to exchange existing notes for new notes with the same outstanding principal but with borrower-favorable terms, like delayed payment or extended maturation dates (a "Face Value Exchange"). Or the company might seek to exchange existing notes for new notes with a lower face amount, motivated by discounted trading values for the existing notes (a "Fair Value Exchange").

Numerous public-private partnerships have been formed in recent years as a device for funding infrastructure projects such as ports, toll roads and other transportation projects, sewer systems and parking garages. State and local governments, which have been strapped for cash to spend on infrastructure projects, have granted private entities the right to operate various infrastructure projects in exchange for a significant up-front payment and/or periodic payments.

What do the Pocahontas Parkway (Richmond, Va., vicinity), South Bay Expressway (San Diego, Calif.) and Indiana Toll Road have in common?

All are toll road projects that are currently undergoing or have been through a restructuring – or even bankruptcy. While traditional restructuring tools are certainly available in restructuring toll road deals, toll road restructurings also present unique considerations that warrant special attention.

One of the primary fights underlying assumption of an unexpired lease or executory contract has long been over whether any debtor breaches under the agreement are “curable.” Before the 2005 amendments to the Bankruptcy Code, courts were split over whether historic nonmonetary breaches (such as a failure to maintain cash reserves or prescribed hours of operation) undermined a debtor’s ability to assume the lease or contract.