When companies are worth less than their debt obligations, the debt holders get all the claims. This means all the revenue in a sale, or they can wind up owning

When companies are worth less than their debt obligations, the debt holders get all the claims. This means all the revenue in a sale, or they can wind up owning the company. (This is oversimplified but directionally correct) With Birchbox, one equity investor later provided debt. Others didn’t. When the company dropped in value, the debt holder wound up owning the whole thing. Sears seems to going through something similar at a larger scale.