Powin Bankruptcy: $54M Asset Sales Leave Unsecured Creditors With Sub-5% Recovery

Powin, LLC, once the third-largest battery energy storage integrator in the United States, wound down through a confirmed chapter 11 liquidation that transferred its core technology to a competitor and left general unsecured creditors facing a projected recovery of just 0.8% to 4.5%. The Oregon-based company filed for chapter 11 on June 9, 2025, in the U.S. Bankruptcy Court for the District of New Jersey under lead case 25-16137 before Hon. Michael B. Kaplan—eight months after closing a $200 million KKR-backed credit facility.

The filing did not follow gradually. Gerard Uzzi's First Day Declaration describes a liquidity crisis that began when the prepetition lenders declared defaults on March 24, 2025, demanded payment in full, and then exercised proxy rights to install Uzzi as Powin's independent manager weeks before the petition. Tariffs on Chinese-sourced batteries and uncertainty over federal tax credits formed the industry backdrop the company cited publicly, but the proximate cause was lender action and a cash shortfall. The case moved directly into a marketed sale: FlexGen Power Systems acquired Powin's intellectual property, software, and spare parts for $36 million as part of the court-approved $54 million asset sales, and the court confirmed a combined liquidation plan on December 1, 2025 that went effective December 5.

Debtor(s)	Powin, LLC (9 jointly administered debtors at petition)
Court	U.S. Bankruptcy Court, District of New Jersey
Case Number	25-16137 (jointly administered)
Judge	Hon. Michael B. Kaplan
Petition Date	June 9, 2025
Plan Type	Combined Disclosure Statement and Joint Chapter 11 Plan of Liquidation
Confirmation Date	December 1, 2025
Effective Date	December 5, 2025
Estimated Assets	$100 million to $500 million
Estimated Liabilities	$100 million to $500 million
363 Buyer	FlexGen Power Systems ($36 million)
DIP Facility	$27.5 million superpriority cash-flow term loan (FlexGen, also stalking horse)

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Powin Bankruptcy

What are the key takeaways from “Powin Bankruptcy: $54M Asset Sales Leave Unsecured Creditors With Sub-5% Recovery”?

From Consumer Goods to Grid-Scale Storage

Joseph Lu founded Powin Corporation in Oregon in 1989 as a manufacturing and logistics company serving consumer goods businesses that outsourced production to China and Taiwan. The company went public in 2010, began research into stationary energy storage in 2011, consolidated as Powin Energy in 2015, and by 2016 had made battery storage its sole business. By 2022 it ranked as the fifth-largest BESS integrator globally, and the First Day Declaration reported more than 17,000 MWh of systems deployed or under construction worldwide, with deployed utility-scale projects worth over $2 billion relying on its StackOS software platform for safe operation.

The company's largest installation was the 1.9 GWh Waratah Super Battery in New South Wales, Australia, built on the footprint of the retired Munmorah coal-fired power station and developed for Akaysha Energy, a BlackRock portfolio company. The project used 2,592 Centipede energy segments and power conversion systems from EKS Energy, a Powin subsidiary whose 20% residual stake would later be sold separately in the bankruptcy. The Waratah project also illustrated the distinction the debtors drew throughout the case: a long-term service agreement (LTSA) servicing business that customers wanted preserved, separate from the new-project engineering business that proved unsustainable.

The company sourced lithium iron phosphate cells from Chinese manufacturers including Hithium, EVE Energy, and Rept. LFP chemistry dominated the utility-scale storage market on safety, longevity, and cost, but the reliance on Chinese cells left Powin's cost structure directly exposed to U.S. trade policy as tariffs escalated through early 2025.

Lender Defaults and the Uzzi Control Shift

The First Day Declaration frames the filing around a rapid loss of lender support rather than industry headwinds alone. The prepetition agent and lenders declared payment and covenant defaults on March 24, 2025, and demanded payment in full of the secured debt. The agent then exercised cash dominion over Powin's blocked accounts and, on April 25, 2025, exercised proxy rights to install Gerard Uzzi as independent manager—a creditor-driven governance change roughly six weeks before the petition.

After his appointment, Uzzi described severe liquidity constraints, extreme dependence on trade credit, and rising liquidated-damages assertions from customers tied to alleged performance delays. The new-project (ESA) business was not immediately sustainable because two of Powin's largest customers terminated projects during restructuring discussions, while remaining customers focused on preserving the LTSA servicing relationships that kept their installed systems operating. To buy time for a value-maximizing process, Uzzi negotiated a release and re-lending of $6.25 million from the prepetition secured creditors.

The workforce shrank alongside the balance sheet. Powin employed roughly 500 people at the start of 2025; by late April, layoffs had cut headcount by 83%, and only 85 employees remained at filing. The company notified state and local officials of a potential cessation of operations, warning that as many as 250 staff could be terminated by July 28, 2025—notices that later seeded a WARN Act class action resolved in the case.

The company also cited trade policy publicly. Powin described itself as "navigating a period of significant financial challenge" compounded by tariffs, and duties on Chinese battery imports stayed above 40% even during the 90-day tariff pause, per a Clean Energy Associates analysis, with the potential to reach 82% or higher and to raise BESS system costs by 11% to 16%. A parallel risk was the possible elimination of Investment Tax Credits through budget reconciliation, which threatened to remove 30% to 40% of the capital-expenditure incentive for Powin's customers. The liquidating plan later preserved tariff-refund litigation against the United States as a potential recovery asset for creditors.

Prepetition Capital Structure and the GLAS-Agented Facility

The center of Powin's prepetition capital structure was an October 1, 2024 loan agreement among Powin, its parent pledgor, subsidiary guarantors, GLAS USA LLC as administrative and collateral agent, and the prepetition lenders. That facility—closed the day before Powin publicly announced the $200 million KKR financing sourced largely from insurance accounts managed by KKR—was structured to bridge working-capital needs between vendor purchases and customer progress payments.

The lenders held liens on substantially all assets, including cash, supported by blocked-account and deposit-account control arrangements at JPMorgan and HSBC. Those control mechanics are what let the agent seize cash dominion immediately upon the March 2025 defaults. The voluntary petition and case records placed prepetition funded debt at roughly $25.6 million, against an estate the debtors estimated at $100 million to $500 million in assets and an equal range of liabilities. The equity side had been built through earlier growth rounds, including a 2022 $135 million investment led by GIC, Singapore's sovereign wealth fund, with participation from Trilantic Energy Partners North America and Energy Impact Partners. By confirmation, the unsecured side of the structure was substantial: the joint plan addressed an estimated nearly $300 million in unsecured claims against an estate whose asset sales totaled roughly $54 million.

FlexGen DIP Financing and the Three-Way Asset Sale

The first-day package opened with cash-collateral relief—the court entered an interim cash collateral order on June 13, 2025—before the case shifted to a FlexGen-led debtor-in-possession facility. The DIP motion filed June 21 sought a secured superpriority operational cash-flow loan of up to $27.5 million that would fund a section 363 sale process in which the DIP lender would also serve as stalking horse. The final DIP order entered July 25 approved advances of up to $10 million during the interim period, a $5 million second advance, a $7.5 million third advance, and a $5 million contingent loan, with FlexGen Power Systems serving as DIP lender, administrative agent, and collateral agent. Latham & Watkins represented FlexGen in both its lender and acquirer roles.

Powin moved quickly into a marketed process. Huron Transaction Advisory launched the sale effort in May 2025, contacting 94 prospective parties, 23 of which executed NDAs. The stalking-horse motion identified FlexGen as the lead buyer at a $36 million purchase price, and the bidding procedures order entered July 17 approved a $1.1 million break-up fee plus expense reimbursement.

The July 30 auction produced no overbids. The notice of winning bidders reported a split across three asset packages, each drawing a single qualified bid: FlexGen won the "Purchased Assets," Mainfreight Distribution Pty Ltd. won the "MF Credit Bid Collateral" on a credit bid, and Hitachi Energy Ltd. won the 20% interest in EKS HoldCo, LLC for $15 million in cash plus a waiver of all claims against the estates. The court entered a separate Mainfreight credit-bid sale order on August 8 and the FlexGen sale order on August 18, authorizing transfer of all intellectual property—hardware IP, software IP, and information technology systems—and significant spare-parts inventory free and clear of liens. On closing, FlexGen would support more than 25 GWh of battery storage across 200 projects in 10 countries. The DIP was fully satisfied on August 19, 2025, when FlexGen applied the outstanding obligations as a credit against its purchase price.

The sale generated residual disputes that carried into the plan. A FlexGen/Welldex settlement among the debtors, FlexGen, and the committee resolved claims arising under the sale, including the transfer of "Substitute Inventory" free of liens previously asserted by Solar Carver, and the plan required the debtors to hold a $3 million FlexGen Reserve on the effective date pending further order. Customer-side disputes followed: an ad hoc customer group moved to compel assignment of OEM warranties and guaranties in October 2025, arguing the debtors had rejected customer contracts without providing warranty documentation essential to safe operation of large industrial and utility-scale BESS projects. Mainfreight separately obtained an order confirming the automatic stay did not apply to certain goods in its possession on September 3, 2025.

Liquidating Plan and the U.S. Trustee Release Fight

The chapter 11 endgame was a joint liquidation plan proposed by the debtors and the committee rather than a reorganization. The initial combined disclosure statement and plan filed October 6, 2025 disclosed that Powin, LLC had changed its name to BESS RemainCo and that the debtor group would expand toward 13 entities by plan stage. The solicitation version filed October 15 organized treatment into seven classes: Class 1 priority non-tax claims, Class 2 other secured claims, Class 3 WARN Act claims, Class 4 settled priority claims, Class 5 general unsecured claims, Class 6 intercompany claims, and Class 7 interests.

Recoveries were top-weighted. Allowed priority claims were paid in full, while Class 5 general unsecured creditors received pro rata interests in a Liquidating Trust, with a separate Direct Claims Trust referenced for certain claims. The only numeric recovery figure to surface in the filings came from a later U.S. Trustee objection, which stated that general unsecured creditors were projected to recover only 0.8% to 4.5%. Class 7 prepetition equity was cancelled without recovery.

The U.S. Trustee fought the plan's release architecture. In a November 18 objection, the U.S. Trustee argued the plan sought non-consensual third-party releases, overbroad exculpation, overbroad debtor releases and injunctions, and an improper waiver of the Rule 3020(e) stay. The confirmation order entered December 1 narrowed the provisions to obtain confirmation: it struck clauses (d), (e), and (g) from the definition of Released Parties and clauses (d) and (g) from the definition of Exculpated Parties, while expressly adding Brian Kane and Chad Paulson as released and exculpated parties. Judge Kaplan approved the debtor release as a sound exercise of business judgment and found the third-party release consensual on the basis of the opt-out mechanism—reasoning that parties who failed to return opt-out forms were deemed to have granted the release—an approach the U.S. Trustee had specifically contested. The plan became effective on December 5, 2025, setting January 5, 2026 as the rejection-claim deadline, January 19 as the professional-fee deadline, and February 3 as the administrative-claim deadline.

The workforce reductions that preceded the filing produced a separate settlement track. Former employee Brian Palomino brought a WARN Act class action (Adversary Proceeding 25-01249), which the court preliminarily approved on December 2, 2025 and then finally approved on February 11, 2026, with Raisner Roupinian LLP, The Gardner Firm, and Lankenau & Miller serving as class counsel. The settlement resolved the mass-layoff claims for $3.5 million.

Professional Fees and the Enhancement Dispute

The official committee of unsecured creditors was appointed effective June 26, 2025, initially including ACE Engineering, Celestica, CATL, Kupono Solar, Formosa Electronic Industries, JMS Wind Energy, R.H. Shipping & Chartering, Brian Palomino, and GreEnergy Resources. Dentons US LLP served as lead debtors' counsel with Togut, Segal & Segal LLP as co-counsel, Uzzi acting through CBMN Advisors LLC (d/b/a Uzzi & Lall) as financial advisor, and Huron Transaction Advisory as investment banker. Brown Rudnick LLP represented the committee, with Genova Burns LLC as local counsel and Alvarez & Marsal as financial advisor. Kurtzman Carson Consultants, operating as Verita Global, served as claims and noticing agent. In January 2026, the M&A Advisor named Dentons its Chapter 11 Reorganization of the Year winner for the Powin case in the $250 million to $500 million transaction category.

Final fee orders entered in early 2026 put the headline numbers on the record. Dentons was allowed $6,074,243.27 for June 9 through December 5, 2025, Togut $399,783.00 in fees plus $1,619.04 in expenses, Brown Rudnick $2,795,958.20 in fees plus $18,156.89 in expenses, and Alvarez & Marsal $2,699,926.48 in total compensation—roughly $12 million across the four headline professionals.

A discretionary fee enhancement then drew an objection that remained open into mid-2026. On January 28, 2026, the debtors' professionals—Dentons, Togut, and Uzzi & Lall—jointly moved for an aggregate enhancement of $651,500.64 (Dentons $323,636.65, Togut $47,864.00, and Uzzi & Lall $280,000.00), arguing it was justified by the "exceptional result" of avoiding a chapter 7 liquidation through three asset sales and a consensual plan after their retention on the eve of bankruptcy. The U.S. Trustee objected on February 17, arguing that enhancements are reserved for rare and exceptional cases—typically full unsecured recoveries—whereas Powin's general unsecured creditors were projected to recover only 0.8% to 4.5%, and that the professionals were already paid market rates, with Dentons and Togut partners billing $1,545 to $1,800 per hour. The hearing on the enhancement motion was repeatedly adjourned, and a July 21, 2026 notice reset it for September 15, 2026, leaving the dispute unresolved.

The estate continued to wind down under the trust structure. J.S. Held LLC serves as Liquidating Trustee, and on June 3, 2026 it filed a statement of initial valuation of trust assets, confirming the valuation required within 180 days of the effective date was complete while keeping the aggregate figure available only to parties on request. The Liquidating Trust and Direct Claims Trust filed quarterly post-confirmation reports, and the claims-objection deadline was extended repeatedly through 2026 as reconciliation continued. One sizable dispute was resolved when a stipulation reduced Pulse Clean Energy's claim—arising from a rejected Scotland battery-storage supply agreement—from $12,152,823.70 to an allowed $2,676,517.54, and split roughly $6.82 million of escrowed property so that the Trust withdrew $500,000 and Pulse retained the remainder.

Phoenix Management LLC, operating under J.S. Held as trust administrator, reported no distributions to administrative, secured, general unsecured, or equity holders as of June 30, 2026, with cumulative priority-claim payments still at $500,000 and none paid during the second quarter; the trustee said it could not yet estimate either total allowed claims or total anticipated plan payments. On July 7, 2026, the trustee moved to close eleven of the affiliated debtor cases while keeping Powin, LLC and Powin Project LLC open, citing a December 7, 2026 claims-objection deadline and continued reconciliation in the two remaining cases. Judge Kaplan granted that relief on July 30, 2026, entering a final decree closing the eleven affiliate cases while Powin, LLC and Powin Project LLC remain open; the decree does not alter distribution rights or other substantive claim rights under the plan, and claims reconciliation continues in the two surviving cases.

Key Timeline

Date	Event
1989	Joseph Lu founds Powin Corporation in Oregon
2016	Energy storage becomes Powin's sole business focus
2022	GIC leads $135 million investment
October 2024	KKR/GLAS facility closes
March 24, 2025	Prepetition lenders declare defaults, demand payment in full
April 25, 2025	Agent exercises proxy rights; Gerard Uzzi installed as independent manager
Late April 2025	Layoffs cut workforce by 83%
June 9, 2025	chapter 11 petitions filed
June 13, 2025	Interim cash collateral order entered
June 21, 2025	DIP motion filed
June 26, 2025	Official committee appointed
July 17, 2025	FlexGen designated stalking horse
July 25, 2025	Final DIP order entered
July 30, 2025	Auction held; FlexGen, Mainfreight, Hitachi each sole qualified bidder
August 18, 2025	FlexGen sale order entered ($36 million)
August 19, 2025	DIP satisfied via credit against purchase price
October 15, 2025	Solicitation plan and disclosure statement filed
November 18, 2025	U.S. Trustee objects to plan releases
December 1, 2025	Confirmation order entered with narrowed releases
December 5, 2025	Plan effective date
January 28, 2026	Debtors' professionals move for $651,500.64 fee enhancement
February 11, 2026	Final WARN class settlement approved
February 17, 2026	U.S. Trustee objects to fee enhancement
June 3, 2026	Trustee files initial valuation of trust assets
July 7, 2026	Trustee moves to close eleven affiliate cases, keeping two open
July 17, 2026	Q2 2026 trust report shows no distributions, $500,000 cumulative priority paid
July 21, 2026	Fee-enhancement hearing adjourned to September 15, 2026
July 30, 2026	Final decree closes eleven affiliate cases; Powin, LLC and Powin Project LLC remain open

Frequently Asked Questions

Why did Powin file for chapter 11?

The First Day Declaration attributes the filing to a liquidity collapse after the prepetition lenders declared defaults on March 24, 2025 and installed an independent manager in April. Tariffs on Chinese batteries and uncertainty over Investment Tax Credits were industry headwinds the company cited publicly, but the proximate trigger was lender action and a cash shortfall.

Who acquired Powin's assets?

FlexGen Power Systems acquired Powin's intellectual property and spare-parts inventory for $36 million under an August 18, 2025 sale order. Separately, Mainfreight won a credit-bid package and Hitachi Energy acquired the 20% interest in EKS HoldCo for $15 million plus a claims waiver—roughly $54 million in total asset sales.

What will general unsecured creditors recover?

A U.S. Trustee objection disclosed a projected recovery of 0.8% to 4.5% for general unsecured creditors, who receive pro rata interests in a Liquidating Trust. Allowed priority claims were paid in full, and prepetition equity was cancelled.

What happened with the plan's third-party releases?

The U.S. Trustee objected that the releases and exculpation were overbroad and non-consensual. The confirmation order struck several clauses from the Released and Exculpated Parties definitions but upheld the opt-out third-party release, treating creditors who did not return opt-out forms as having consented.

How were the WARN Act claims handled?

Former employees brought a WARN Act class action (Adv. Proc. 25-01249) over the layoffs that cut headcount by 83% before filing. The court granted final approval of a $3.5 million class settlement on February 11, 2026.

Who is the claims agent for Powin?

Kurtzman Carson Consultants, operating as Verita Global, serves as claims and noticing agent under its first-day retention. The effective-date notice set the operative administrative, rejection, and professional-fee claim deadlines in early 2026.

For related coverage, see ElevenFlo's analyses of Ambri's battery-startup 363 sale and liquidating plan, Ample's battery-swapping collapse, Fisker's EV liquidation through 363 sales, and At Home Group's tariff-driven restructuring.