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The article focuses on United Nations Commission on International Trade Law (UNCITRAL) instruments include the Model Law on Insolvency Related Judgments (MLJ), and the Model Law on the Insolvency of Enterprise Groups (MLEG). It mentions join the existing Model Law on Cross Border Insolvency (MLCBI) and the Legislative Guide on Insolvency. It also mentions creditors, may choose a jurisdiction for strategic reasons distinct from either value maximization.

In bankruptcy, creditors exercise governance rights over a debtor firm--they vote to accept or reject a proposed plan of reorganization. These governance rights are apportioned based on the amount of a creditor's claim: one dollar, one vote. "This allocation assumes a claim reflects the creditor's true economic interest in the debtor, and the creditor is thus presumed to use its governance rights in the bankruptcy to maximize the value of the debtor, and hence its claim. Yet a creditor s financial interest is not always limited or even linked to the face amount of its claim. For example, the interest of employee creditors extends beyond recovering backpay to ensuring future employment, while a landlord's interest may be less in recovering back rent than in being abb: to terminate a lease so it can relet the property at a higher rate. Historically, this has been a discrete and manageable problem. Two recent developments in financial markets, however, have made the mismatch between a creditor's total economic interests and its claim-- and the concomitant governance rights-- more problematic. First, a robust market has arisen in distressed debt, enabling investors to purchase bankruptcy claims-- and thus governance rights-- at a discount. Second, the emergence of derivatives markets now enables investors to go short on the debtor and benefit from its misfortune. Combined, these developments enable investors to cheaply acquire governance rights in bankruptcy and then use that power to further the value of their extraneous interests rather than maximizing the value of their bankruptcy claim. As a result, the "one dollar, one vote" principle underlying bankruptcy governance is now in question. This Article illustrates problems that result from the divergence of economic interests and governance rights in bankruptcy. It shows that existing bankruptcy law tools, such as disclosure, vote designation, trading bars, equitable subordination, and equitable disallowance, fail to provide adequate remedies for the problems. Accordingly, we propose an administrable system of "mark-to-market governance," in which the governance rights, but not the economic distribution rights, associated with a creditor's bankruptcy claim would be adjusted to reflect the creditor's true net economic position. Under mark-to-market governance, hedgers and shorts would be subject to proportional dilution, claims purchasers ivould have their governance rights discounted based on purchase price, and secured creditors ivould have their credit bidding rights limited to the value of their collateral. Together these adjustments will promote the core bankruptcy policies of maximizing the value of the debtor firm and equitably distributing its vcdue. [ABSTRACT FROM AUTHOR]

The article establishes the legal limits of secured lending under nonbankruptcy law. Topics discussed include the practical limits of secured lending under nonbankruptcy law, the value of the secured creditor's entitlement that should be measured as of the petition date, and a number of applications of the principles articulated to a variety of bankruptcy topics.

In Chrysler's Chapter 11 bankruptcy, a finding that the debtor was losing $100 million per day justified the hurry-up sale of the company to Fiat. The assertion that a firm is a melting ice cube is frequently offered, soon after a bankruptcy filing, to justify a quick sale of the firm under § 363(b) of the Bankruptcy Code. This raises a policy question: is this speed and the attendant streamlining of process a bug or feature? Do hurry-up going-concern sales maximize value for the bankruptcy estate, or do they facilitate collusive deals among incumbent managers, senior creditors, and potential purchasers? The answer is a little bit of both. It is crucial to distinguish between sales where the court and parties have good information about the value of the company and the costs of delay, from those in which melting ice cube leverage is used to exploit information asymmetries and to lock in a favored deal. To accomplish this sorting and reduce opportunistic use of transactional leverage, we seek to allocate the increased risks of forgone process to the beneficiaries of the sale rather than to the bankruptcy estate. We propose that a reserve—the Ice Cube Bond—be set aside at the time of sale to preserve any potential disputes about valuation and priority for resolution after the sale has closed. This approach retains expedited § 363 sales as a useful way to quiet title in complex assets and maximize value, while preserving the opportunities for negotiation and adjudication contemplated by the Bankruptcy Code. [ABSTRACT FROM AUTHOR]