A strategy used by investors to take control of a distressed company, often through bankruptcy proceedings. The strategy involves investing in the distressed company's debt (which is typically secured by the company's assets) to have an advantage in eventual bankruptcy proceedings (or to negotiate for the ability to convert to equity prepetition). The investor's debt is then exchanged for equity under a plan of reorganization and existing equity investors and certain creditors (often unsecured creditors) get wiped out. Investors bet on where the fulcrum security lies in the company's capital structure to execute this strategy.