Omnis Pleasants Files Chapter 11 After $75.64M Payoff Rejected

Omnis Pleasants, LLC, the operator of the Pleasants Power Station, filed a chapter 11 petition in the U.S. Bankruptcy Court for the District of Delaware on July 26, 2026, under case number 26-11169, assigned to Chief Judge Karen B. Owens. The filing followed a rejected $75.64 million payoff attempt and a boardroom fight over control of the 1,278-megawatt coal-fired plant in Belmont, West Virginia, between the debtor's current independent management and the entities that sold it the plant three years earlier. Those entities have since asked the bankruptcy court to dismiss the case as a bad-faith filing, arguing Omnis Pleasants went to Delaware one business day after losing the same fight in West Virginia state court.

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Omnis Pleasants Files Chapter 11 After $75.64M Payoff Rejected

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Key Timeline

The Reformer Project and Capital Diversion

Omnis Fuel Technologies, LLC, through its acquisition subsidiary Quantum Pleasants, LLC, bought the two-unit plant in August 2023, months after the West Virginia legislature passed SB 609 to block a planned demolition by prior owner Energy Harbor. Simon Hodson, chairman and chief executive of Omnis Fuel Technologies, Omnis Global Technologies, LLC and Quantum, controlled the acquired entities through his indirect ownership of their Class A units and through Hodson Investments, LLC, owned by Hodson, his spouse and his children.

Beginning in the fourth quarter of 2023, prior management under Hodson directed capital and personnel toward a hydrogen-from-coal technology called the Reformer, raising money from lenders, investors and government agencies on promises that commercialization was imminent. According to the debtor's declaration, the project shifted by August 2024 into a platform for investor tours and demonstrations that continued through October 2025 without meaningful technical progress, while the plant itself ran short of capital: coal inventories fell to less than five hours of run time at one point, and the plant lost access to an ash-disposal landfill in August 2024 for nonpayment. The Federal Energy Regulatory Commission opened an investigation in October 2025 into the plant's and other Omnis Parties affiliates' 2023-2025 operations, and the debtor's declaration warns that capacity revenue earned during the review period could be subject to disgorgement along with additional fines. The debtor's chapter 11 petition alleges fraud by the former ownership group, WTAP reported. A separate federal lawsuit filed in March 2024 by former Omnis executive Michelle Christian alleges Hodson misrepresented the value of his ventures ahead of the WVEDA's loan approval, and separately claims Omnis withheld a promised $215,512 bonus tied to fundraising milestones. The plant employs approximately 136 people, and the Pleasants County Commission president said those jobs remained secure despite the filing. Since Nathan and Hindman took over in February 2026, the debtor's declaration says management has rebuilt the workforce, renegotiated vendor and fuel-supply arrangements, and addressed the plant's environmental and regulatory issues, restoring operational stability.

State Loan Funds Traced to StarSource

Quantum borrowed up to $50 million from the West Virginia Economic Development Authority in December 2023 to fund the Reformer project, with Pleasants guaranteeing the loan and WVEDA fully disbursing the funds by June 2024. The debtor's ongoing investigation has since uncovered a pattern of circular transfers between Omnis Fuel Technologies and an entity called StarSource, LLC, controlled by Hodson, in which funds moved from Omnis Fuel Technologies to StarSource and back before being presented to WVEDA and the West Virginia State Auditor's Office as qualifying project expenditures.

The debtor identified more than $114 million in invoices from Industrial Accessories Company, including four invoices totaling roughly $100.6 million submitted to the state to support matching-fund requests, but found only about $4.2 million in actual payments to that company and roughly $39.6 million of WVEDA-disbursed funds transferred directly to its accounts. WVEDA declared the loan in default in July 2025 over the alleged misuse of proceeds and, after the loan matured unpaid in June 2026, told the debtor it would not accept any resolution that restored former management to control of the plant. Court filings describe the state as misled about how the aid was spent, the West Virginia Gazette-Mail reported.

Capital Structure and the TRAG/RG Energy Lien

As of the petition date, the debtor's funded debt and guarantee obligations totaled approximately $70.8 million, made up of the $50.9 million outstanding WVEDA loan and a purported $20 million unsecured note issued to Bilt Technology LLC, personally guaranteed by Hodson. The Bilt note traces to a March 2025 power purchase agreement between Pleasants and Element H Data, LLC, a Hodson affiliate formed the same day the agreement was signed, that priced power at no more than $30.54 per megawatt-hour -- below the plant's generation cost and, by the debtor's internal projections, a path to more than $1 billion in losses over the agreement's life. Bilt transferred $22.249 million to Pleasants as a "commitment fee" tied to a related agreement between Element H and Bilt, and $20 million of that amount moved from Pleasants to Omnis Fuel Technologies the same day, at Hodson's direction.

Separately, TRAG LLC and RG Energy LLC hold a first-priority lien on substantially all of the debtor's property, including the plant itself, and are owed more than $80 million under loans made to Pleasants' parent entities between 2023 and 2025. The debtor also disclosed roughly $46 million in disputed intercompany notes between Pleasants and both Quantum and Omnis Fuel Technologies, dated October 2023, whose legitimacy remains under investigation, along with about $4 million in trade debt and roughly $13 million of liquidity on hand at filing.

The petition estimates both assets and liabilities in the $50 million to $100 million range, and the debtor's creditor matrix lists just under 600 creditors, including 70 based in West Virginia. Beyond the WVEDA and Bilt Technology obligations, the largest scheduled unsecured claims include $600,000 owed to Richmond, Kentucky-based BlueTerra Innovations LLC for professional services and seven West Virginia vendors: $287,145 to Litman Excavating, $151,796 to United Construction, $130,005 to J&J Equipment, $54,995 to Precision Pump & Valve Service, $26,014 to Jabo Supply, $21,904 to Bowles Rice, and $21,886 to Energy Piping WV.

Forbearance Agreement and the Rejected Payoff

Facing defaults across its debt stack, the debtor's ownership agreed to a governance overhaul: an Amended and Restated Forbearance Agreement, effective February 6, 2026, among TRAG, RG Energy, Omnis Global Technologies, Omnis Fuel Technologies, Quantum and Pleasants installed Gilbert Nathan as independent manager and sole director and David Hindman, of AlixPartners affiliate AP Services, LLC, as chief executive, while removing Hodson and his brother-in-law Randall Smith from their officer and director roles. The agreement gave TRAG and RG Energy a first-priority lien on the plant and barred removal of the independent manager without their consent.

That arrangement unraveled in July 2026. The debtor's first-day declaration says the Omnis Parties also pursued efforts to undermine the plant's ability to operate during this period, including a purported lease agreement that would have made operating the plant impossible and an attempted sale of power and capacity behind the meter, which the declaration says is not permitted for a PJM capacity auction award recipient. On July 8, Omnis Global Technologies, Omnis Fuel Technologies and Quantum sued TRAG and Nathan in the Circuit Court of Pleasants County, West Virginia, seeking a temporary restraining order; the court denied it. On July 16, entities tied to former management -- Angela Chen Sabella, Dynamic Holdings Corporation, Dynamic Finance Corporation and the Harmony Trust -- attempted to deliver an uncertified check for $75.64 million to TRAG and RG Energy's counsel, asserting the payment satisfied the loans in full and would automatically terminate the forbearance agreement's governance restrictions. Nathan rejected the transaction as an unapproved related-party payment after the payor and source of funds went undisclosed. Four days later, Omnis Global Technologies, Omnis Fuel Technologies and Quantum declared the forbearance agreement terminated by the rejected payment, removed Nathan and installed Charles Gassenheimer, president of Omnis Fuel Technologies, as interim director. TRAG and RG Energy countered with their own motion for a temporary restraining order and preliminary injunction in the West Virginia litigation, joined by Nathan; the court denied that motion on July 24 without ruling on the merits, after which the objecting parties said they intended to enter the plant on July 26 "by force if necessary."

Bad-Faith Dismissal Motion and Cash Collateral

Omnis Fuel Technologies and Quantum carried the authority fight into Delaware, filing an omnibus objection to the debtor's first-day motions on July 29, supported by a declaration from Gassenheimer arguing that the July 16 payment triggered an automatic "payment in full" carve-out in the forbearance agreement, terminating the independent manager's authority before the petition was filed. The Gassenheimer declaration says TRAG and RG Energy first identified the $75.64 million figure themselves, in a July 15 restructuring term sheet, and that Dynamic Finance Corporation tendered payment the next day with an offer to pay any additional properly documented amount. Gassenheimer, who says he became Omnis Energy's president in July 2025 and was appointed Pleasants' interim director on July 20 after Quantum -- as sole equity owner -- removed Nathan, has characterized the $75.64 million payment as a loan to Omnis Energy that does not itself sell or transfer the plant. The objectors also challenged the debtor's cash collateral motion, filed July 28, which sought court authorization to use cash collateral securing the WVEDA, TRAG and RG Energy obligations and to grant adequate protection to those prepetition secured parties. The debtor did not file for new-money debtor-in-possession financing, relying instead on continued use of the prepetition secured parties' cash collateral to fund operations through the case.

The same objection asks the court to dismiss the chapter 11 case outright as a bad-faith filing, framing it as an attempt to use the federal courts to win a fight the ownership group had already lost in state court. The objectors point to the debtor's own disclosure of roughly $13 million of liquidity on hand at filing as evidence against any emergency that would justify chapter 11, and argue that outside firms -- not the ownership group accused of mismanagement -- ran the plant's day-to-day operations and energy sales throughout the disputed period.

Following a July 29 hearing, the debtor's counsel certified that the court approved the cash collateral motion on an interim basis subject to revisions, and the court entered an interim cash collateral order the same day. The order authorizes use of the collateral through a scheduled final hearing without resolving the objectors' underlying challenge to the debtor's authority to file the case or their request to dismiss it. The court has scheduled a final hearing on the first-day pleadings for September 3, 2026 at 1:00 p.m. ET, with objections to final relief due August 19, 2026 at 4:00 p.m. ET. The U.S. Trustee had not appointed an official committee of unsecured creditors as of August 4, 2026. TRAG and RG Energy entered a formal notice of appearance on August 7, with the court admitting their outside counsel, Douglas I. Koff and Ira J. Schacter, pro hac vice ahead of the September 3 hearing.

Sale Process and the Investment-Bank Search

The debtor's stated objective is a chapter 11 process that lets it investigate and pursue estate claims against former management while running a competitive sale of the plant free of the disputed debt. The company said it expected to seek approval to continue the sale process and anticipated an independent third-party purchaser. The company has said the facility will continue supplying PJM during the process. Hindman's declaration states the debtor is selecting an investment bank and will file a bidding-procedures motion to launch that marketing process, but no sale motion, bidding-procedures order, disclosure statement or plan had been filed as of August 3, 2026. Before the petition, the board authorized retention of a restructuring team that includes Herbert Smith Freehills Kramer (US) LLP as bankruptcy counsel, Young Conaway Stargatt & Taylor, LLP as co-bankruptcy counsel, and AlixPartners, LLP as financial adviser; the court has since admitted several Herbert Smith Freehills Kramer attorneys, including Alexander Woolverton, pro hac vice. Stretto, Inc. is proposed as claims and noticing agent for the case, and in a filed presentation outlined a proposed path toward a going-concern sale that includes seeking approval of bidding procedures, continuing to engage potential buyers to identify a stalking-horse bidder, retaining an investment banker, and conducting an auction if no qualified stalking horse emerges.

Frequently Asked Questions

Why did Omnis Pleasants file for chapter 11?

The debtor's chief executive, David Hindman, said the company needed chapter 11 to preserve the plant's value and stability after reaching an impasse with the Omnis Parties over control of a restructuring or sale process, and after those parties took a series of actions in July 2026 -- including an attempted $75.64 million payoff, West Virginia state-court litigation and a threat to enter the plant by force -- that the debtor said made an immediate filing necessary.

Who is challenging the bankruptcy filing?

Omnis Fuel Technologies, LLC and Quantum Pleasants, LLC, entities tied to the plant's former ownership under Simon Hodson, argue that a July 16, 2026 payment to TRAG LLC and RG Energy LLC terminated the forbearance agreement that empowered independent manager Gilbert Nathan, and that the debtor lacked authority to file the case once they installed Charles Gassenheimer as interim director. Their omnibus objection also asks the court to dismiss the case outright as a bad-faith filing.

Who is the claims agent for Omnis Pleasants?

Stretto, Inc. is proposed as the claims and noticing agent, subject to court approval.

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