The Chapter 11 filing of SunEdison Inc. on April 21, 2016, marked the end of an extremely wild ride for shareholders of the world’s largest renewable-energy development company. Considered both a hedge fund and retail investor darling at its peak, SunEdison enjoyed a more than 2,100 percent increase in its share price between 2012 and 2015, trading as high as $33 a share, before experiencing a dizzying decline in August 2015, when its stock price plummeted 97 percent in a matter of weeks.

The ultimate demise of SunEdison was principally the result of an enormous amount of debt...

Distressed cycles often test the limits of “market” terms and documentation principles prevalent in industry-specific financing arrangements. For independent oil and gas exploration and production (E&P) companies, the industry turmoil that peaked in 2015-2016 put the fundamentals of reserve-based loans (RBLs) under the microscope.

Now that many E&P companies have deleveraged their balance sheets and commodity prices have begun to stabilize, many of the same lenders that suffered through the downturn are back in the market providing new RBLs. Although what is “market” for...