EV is $600M. Capital structure: $400M secured, $300M senior unsecured, then sub debt and equity. Recoveries and fulcrum?

How to answer

Fill the waterfall top-down. Secured ($400M) is fully covered → 100¢ (par). That leaves $600M − $400M = $200M of value for the $300M senior unsecured claim → $200M / $300M ≈ 67¢ on the dollar. The senior unsecured tranche is partially covered, so it's the fulcrum and would typically convert to the reorg equity. Everything junior — sub debt and common equity — recovers $0 (out of the money).

Key idea: Secured at par, $200M left for $300M unsecured → ~67¢ = fulcrum, junior = 0.