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In this session, we will focus on troubled debt restructuring, specifically on modifying the terms of a loan. This follows a prior discussion on settling debt. When modifying terms, two scenarios arise: the undiscounted future cash flows may be less than or greater than the carrying value of the debt. Troubled debt restructuring occurs when a creditor provides concessions to a debtor under non-normal circumstances, which often applies to cases like the real estate crash of 2007-2008, notably affecting construction companies.