Energy companies that are struggling to avert bankruptcy have recently been relying on a tool to buy time called a distressed-debt exchange. That may no longer be as useful, particularly for smaller firms, according to Fitch Ratings. In a distressed exchange, certain bondholders typically get new or restructured securities or cash that amounts to less than what they were initially owed. Often, creditors are willing to make such deals in exchange for being given higher priority in the capital structure, or because it can limit the scope of the restructuring. For the company, a distressed-debt exchange allows it additional time to wait out market conditions, such as persistently low oil prices, without filing for bankruptcy. The use of such exchanges has soared in the past year as energy firms have struggled to stay afloat as oil prices have dropped. They accounted for nearly a fifth of all high yield […]