Chesapeake Considers Unusual 1.5 Lien Debt Exchange

If you can help us figure this one out--please do! Reuters is reporting that Chesapeake Energy is considering swapping out some existing debt for "new 1.5 lien debt." We know a first lien means you have "first dibs"--you're first in line to receive something/anything if a company goes bankrupt. A second lien means you're second in line, behind the first guy. But a one and a half lien? Apparently its possible to create a legal situation where someone is behind the first guy but ahead of the second guy in line--the 1.5 guy. Boggles the mind. What it says to us is that Chesapeake is engaged in some dramatic financial contortions in order to avoid bankruptcy court...

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