The loan terms have a set amount agreed to that the bondholders will gain. In default, sure there will be extra penalties and interest, but I highly doubt the loan terms give them a right to a windfall in excess of those amounts. If the bank forecloses on your house for non-payment, they get the house plus any loan deficiency and costs of collection. They don't also get your first born. Big, big difference. This Gordon Gecko-esque "it's just business" talk is the type of mindset that played a large part in the global financial meltdown.

As for protecting their investment, common sense dictates that the quickest (and probably the only) way they will be repaid is upon kry's successful resolution of the arb. Putting additional obstacles in that path is not "protecting an investment."