This Spotlight article is an executive summary of an article published in the Current Legal Problems (CLP) series, which is itself based on a CLP lecture that the author gave in November 2023.1 The current legal problem identified is that both modern private equity (PE) firms and senior lenders to PE portfolio companies have incentives to avoid a formal restructuring of PE portfolio companies in financial distress. The full article investigates what we can do to address this issue.