RECAPITALIZATION
recapitalization,n. An adjustment or recasting of a corporation’s capital structure — that is, its
stocks, bonds, or other securities — through amendment of the articles of incorporation or merger
with a parent or subsidiary. • An example of recapitalization is the elimination of unpaid preferred
dividends and the creation of a new class of senior securities. Cf. REORGANIZATION(2). [Cases:
Corporations 38, 581. C.J.S. Corporations §§ 54–61, 792–797.] — recapitalize,vb.
leveraged recapitalization.Recapitalization whereby the corporation substitutes debt for
equity in the capital structure, usu. to make the corporation less attractive as a target for a hostile
takeover. — Also termed leveraging up. [Blacks Law 8th]