Over the last 20 years the Commercial Bankruptcy system evolved from being a way that companies could reorganize their debt to being a way that companies could be sold on their own terms instead of liquidated by the Trustee. This was prompted by litigation involving public companies where creditors, frustrated with bankruptcy results, went after management to try to reach additional assets. The theories revolved around what became known as the “zone of insolvency” and the outcome was that the safest way for management in public companies to resolve insolvency was just to maximize the enterprise value of the company, or its assets, and sell out. Equity and Bond holders recovered little or nothing. Predatory competitors delighted in being able to snatch up asset base without having to go the traditional merger or acquisition route. Small companies began to fall into this mix as business brokers, investment bankers, reached down further and further to smaller and smaller companies to try to keep their activity levels high. As a result, the older practice of actually writing a Plan that imposed new terms on creditors and stabilized both the balance sheet and operations passed into obscurity. With the recent downturn in Oil prices lots of companies will be facing liquidity tests with their banks. During times like these, Banks reposition themselves by improving their collateral position and, often, taking effective control of debtor operations by requiring sell off of inventories and materials. Understanding what can happen in a Chapter 11 proceeding is a key element to understanding whether playing by the Bank’s terms is the better course to take. But, for certain, companies facing insolvency should not assume that the smiling face and lunch buying will translate into lenient treatment by a Banker. When insolvency approaches, it is everyone for themselves.