“Lenders will have to figure out how to price this risk,” Schultze, 39, said in a telephone interview from his office in Purchase, New York. “The obvious one is: Don’t lend to a company with big legacy liabilities or demand a much higher rate of interest because you may be leapfrogged in a bankruptcy.”…

Detroit-based GM on April 27 asked the investors to swap $27 billion in debt for a 10 percent stake in the reorganized automaker, while offering a retiree health-care fund $10 billion in cash and as much as a 39 percent stake for $20 billion in unsecured claims.

“It’s terrible precedent,” said Schultze. “The sad thing is it impacts the manufacturing sector and the companies that have legacy liabilities directly. It will be nearly impossible, or much more expensive, to get secured financing for these type of companies.”