Tonopah Solar Energy: $7M Sale and CMB Trustee Fight

Tonopah Solar Energy, LLC won bankruptcy-court approval on March 19, 2026 to sell the Crescent Dunes concentrated solar power plant to Sons of Liberty Construction, Inc. for $7 million in cash, capping a sale process that drew no competing bids and moving the case into a liquidating wind-down. The owner of the 110 MW molten-salt power tower near Tonopah, Nevada filed its second chapter 11 in five years on January 21, 2026 in the U.S. Bankruptcy Court for the District of Delaware, lead case 26-10060, with a $10 million debtor-in-possession facility and a prenegotiated path to a section 363 sale.

The sale resolved the asset question but not the case's defining dispute. CMB Export, LLC and affiliated CMB Infrastructure funds, longtime litigation antagonists of the debtor's Cobra-affiliated owners, moved to appoint a chapter 11 trustee, arguing that conflicted management failed to pursue claims against insiders. The debtor has opposed the motion, objected to CMB's $270 million in proofs of claim, and steered the case onto a liquidating combined plan and disclosure statement, with a combined confirmation hearing rescheduled to July 7, 2026.

Debtor	Tonopah Solar Energy, LLC
Court	U.S. Bankruptcy Court, District of Delaware
Case Number	26-10060
Petition Date	January 21, 2026
Primary Asset	Crescent Dunes 110 MW CSP plant, Tonopah, Nevada
Land Position	BLM lease through December 31, 2039
Primary Secured Creditor	Crescent Dunes Finance, Inc. (about $173 million)
DIP Facility	Up to $10 million (Crescent Dunes Finance)
Asset Sale	Sons of Liberty Construction, Inc., $7 million; approved March 19, 2026
Claims Agent	Epiq
Confirmation Hearing	July 7, 2026 (combined plan)

Open the public case profile for docket context, hearings, advisors, and plan updates.

Second Filing and Recurring Hot-Salt Tank Failures

A second trip through chapter 11. Tonopah Solar Energy owns the 110-megawatt Crescent Dunes plant, a central-receiver tower that uses fields of heliostats to heat molten salt for thermal storage and later electricity generation. The project was financed during the prior decade around a Department of Energy loan guarantee of $737 million secured by developer SolarReserve, alongside a long-term offtake contract with NV Energy. Tonopah Solar and an affiliate first filed chapter 11 in 2020, a case that restructured the balance sheet, established an indemnification escrow, and left Cobra affiliates holding the reorganized debtor's membership interests through designees.

The molten-salt failures. The operating history described in the first day declaration is dominated by repeated hot-salt tank leaks, which the debtor dates to October 2016, March 2019, February 2022, and February 2023. Public reporting on a 2016 salt leak shows how early technical failures forced shutdowns, and the later leaks compounded the downtime. After the 2023 leak, operations resumed on July 13, 2023 at a reduced operating temperature of roughly 850 to 900 degrees Fahrenheit to limit the risk of further leaks, a change the debtor says constrained the plant's output below the levels envisioned when it was described as a roughly $1 billion project.

From the NV Energy contract to short-term offtake. The decline in revenue stability tracked the loss of the project's anchor contract. NV Energy terminated the original long-term power purchase agreement in October 2019, and the debtor afterward operated under shorter-term arrangements, including a short-term NV Energy agreement in 2021 and a short-term Switch PPA entered on May 30, 2025 and set to expire on February 21, 2026. Without a durable long-term offtake contract and with output capped by the temperature reduction, the debtor said it had been relying on continued affiliate cash support, and it tied the second filing to that combination of technical underperformance and revenue instability. Comparable solar-thermal economics have pressured the sector broadly: the nearby Ivanpah plant announced a shutdown plan in 2025, with two of three units expected to close beginning in 2026.

Capital Structure and the Crescent Dunes Finance Position

The debtor entered the case with a thin balance of liquidity against a large secured position. As of the petition date, the first day declaration states that Crescent Dunes Finance, Inc. held approximately $173 million of prepetition debt, plus accrued interest, costs, and fees, while the debtor reported only about $598,000 of available cash, all of which it treated as the prepetition lender's cash collateral. The single secured lender, also the DIP lender, sits at the center of every economic question in the case.

The funding history is itself contested. The debtor says Crescent Dunes Finance and its affiliates had previously treated about $52.9 million of funding as equity rather than debt, and that the prepetition line of credit was increased to $73.5 million in August 2025. The debtor later told the court that insiders infused more than $50 million of equity even after the line was fully drawn, and that roughly $11.9 million of interest, and no principal, was paid between December 2020 and October 2023.

The case was built as a prenegotiated process rather than a standalone reorganization. The debtor said it entered into a restructuring support agreement on December 16, 2025 alongside a forbearance agreement and the DIP financing package with Crescent Dunes Finance. The RSA milestones tracked a dual sale-and-plan path, setting a bid deadline at 50 days, a final DIP order at 55 days, a sale order at 80 days, confirmation at 125 days, consummation at 225 days, and a plan effective date at 240 days.

DIP Financing and Cash Collateral

The court approved interim financing within days of the filing. Judge J. Kate Stickles authorized interim access to the first $5 million of the $10 million DIP facility from Crescent Dunes Finance at a hearing that let the solar plant tap bankruptcy funding to keep the asset operating through the sale. The interim order set a 4.5% per annum interest rate payable in kind, with a 2.0% default-rate increase, and granted the DIP lender priming liens on substantially all assets while authorizing use of cash collateral under an approved budget.

The court entered the final DIP and cash collateral order on February 13, 2026, approving a senior secured superpriority facility governed by an attached term sheet, together with a 13-week budget subject to permitted variances. The order's carve-out covers statutory fees, up to $50,000 for a chapter 7 trustee, budgeted retained-professional fees incurred before a carve-out trigger notice, and a $250,000 post-trigger cap, and it requires monthly funding of a professional-fee reserve.

The financing package hardwired both the case timetable and the lender's protections. The DIP maturity runs to the earliest of an event of default, six months after the petition date, consummation of a sale of substantially all assets, the effective date of a plan, or payment in full of the DIP obligations, and the order's milestones mirror the RSA schedule through plan confirmation and consummation. Third parties were given until April 8, 2026 to obtain standing and challenge the prepetition liens or obligations, with only a $25,000 challenge budget available to any later-appointed committee.

Marketing Process and Sale to Sons of Liberty Construction

A marketing process that pointed to an in-court sale. Investment banker SSG ran a broad outreach effort that, according to the debtor's sale declaration, launched in September 2024, formally relaunched on May 21, 2025, and ultimately contacted 253 potential buyers, split between 129 strategic parties and 124 financial buyers or investors. The indications of interest that came back all contemplated an in-court sale process rather than an out-of-court purchase, which shaped the section 363 path the debtor pursued.

The stalking horse. On February 20, 2026, the debtor and Sons of Liberty Construction, Inc. executed a stalking horse asset purchase agreement carrying a $7 million cash purchase price and a capped $175,000 expense reimbursement if SOLC were outbid. The debtor's sale witness stated that SOLC was not an insider, equity holder, affiliate, or lender, and the Gupta declaration recounts that the construction company first expressed interest in November 2025, received data-room access and a site visit, and negotiated the stalking horse terms postpetition while the debtor marketed the assets as a going concern.

No overbid, then approval. By March 2, 2026, the debtor filed a notice naming SOLC as the proposed successful bidder and cancelling the auction because no other qualified bids were submitted by the deadline, leaving the $7 million stalking horse bid as both the floor and the final price. After two limited objections and several revised forms of order, the court entered the order authorizing the sale of substantially all assets free and clear of liens on March 19, 2026, approving the assumption and assignment of designated contracts subject to cure amounts.

Regulatory consents as the real closing risk. The sale documents condition closing on Bureau of Land Management consent to assignment of the federal right-of-way and contract package and on Federal Energy Regulatory Commission approval under section 203 of the Federal Power Act. The APA sets a June 19, 2026 long-stop date, subject to automatic extension if FERC approval is the only remaining condition. To preserve the right-of-way underlying the plant ahead of closing, the court later authorized the debtor to pay rent owed to the BLM.

CMB Trustee Motion and Claims Litigation

The section 1104 motion. On April 8, 2026, CMB Export, LLC and CMB Infrastructure Investment Group IX, LP and XI, LP moved to appoint a chapter 11 trustee, invoking section 1104(a)(1) and (2). CMB argues that the debtor's management is "hopelessly conflicted" because the debtor is owned and controlled by the Crescent Dunes parties and affiliated with the Cobra defendants, and that management and the special committee failed to investigate or pursue potential fraudulent-transfer and other claims against insiders. CMB points to a roughly $200 million decline in enterprise value since the 2020 case and to the proposed release of former manager Mark Manski as evidence of cause, and notes a $6 million letter of credit securing potential CMB liability tied to a Nevada district court action and ICC arbitrations.

The debtor's opposition. The debtor opposed on April 23, 2026, arguing CMB cannot meet the clear-and-convincing burden to overcome the presumption against appointing a trustee. It says it appointed two independent managers, Ken Coleman and Thomas Donnelly, in March 2025, and that a special committee assisted by Morris Nichols and Teneo investigated the prepetition loans and affiliate transactions and concluded the loans are valid, perfected, and secured with no material insider claims. The debtor characterizes CMB as a "disgruntled litigation party" pursuing "backdoor discovery" for non-bankruptcy litigation and argues that a trustee would add cost, delay, and risk to the pending sale.

The claims fight. On April 13, 2026, the debtor filed a substantive omnibus objection to three CMB proofs of claim, each for $90 million, premised on a qui tam action, the Nevada district court and ICC arbitration claims, and alleged fraudulent transfers. The debtor recounts that an ICC arbitration rejected Counts 1 through 5 and awarded the defendants over $2.4 million in fees, that the Nevada district court confirmed the award and CMB paid the judgment in October 2025, now on appeal to the Ninth Circuit, and that the qui tam action was dismissed at the Department of Justice's request and is also on appeal. The debtor seeks disallowance on res judicata and standing grounds, noting that CMB Group XI's underlying $80 million loan to Cobra Energy Investment Finance, LLC was repaid in full in April 2018.

The Manski settlement. The debtor sought approval of a settlement with former manager Mark Manski on March 16, 2026, which CMB opposed. The court approved a revised settlement on May 14, 2026, releasing $625,000 from the indemnification escrow established under the 2020 plan, with $192,000 distributed to Manski ($100,000 directly and $92,000 to his counsel as a retainer) and $433,000 returned to the debtor, and replacing his consulting arrangement with a new agreement with non-debtor affiliate ACS Industrial Activities, Inc. that pays $90,000 up front plus $15,000 monthly through December 31, 2027. The settlement provides broad mutual releases but expressly preserves the CMB parties' direct claims against Manski.

Liquidating Combined Plan and Wind-Down

After the sale was approved, the debtor moved the case onto a combined plan-and-disclosure-statement track, filing an initial combined chapter 11 plan and disclosure statement on April 13, 2026 and revised versions in May. The court approved the interim disclosure statement and solicitation procedures on May 13, 2026, and the debtor filed the solicitation version of the combined plan on May 14, 2026. The plan is a liquidating chapter 11 plan that uses the sale to monetize the plant and winds the estate down through a Plan Administrator, funded primarily by sale proceeds, with the $10 million DIP facility, described in the plan as a senior secured first-lien priming term loan, available as a backstop if proceeds fall short.

Class structure. The solicitation-version plan sorts claims and interests into seven classes: Class 1 priority claims (unimpaired and not voting); Class 2 the Crescent Dunes Finance secured claim (impaired, voting); Class 3 the CMB secured claim (impaired, voting); Class 4 general unsecured claims (impaired, voting); Class 5 former-manager claims reflecting the Manski settlement (impaired, voting); Class 6 general unsecured convenience claims of $10,000 or less (impaired, voting); and Class 7 equity interests (impaired and deemed to reject). A $7,500 convenience-class fund is designated for distribution, and the reviewed plan text does not state numeric estimated-recovery percentages by class. DIP claims are unclassified and entitled to payment in full in cash on the effective date, and the plan provides exculpation for estate fiduciaries and contemplates mutual releases.

Confirmation schedule. The combined confirmation hearing was originally set for June 25, 2026 and has been rescheduled to July 7, 2026 at 10:00 a.m. Eastern, with a possible continuation to July 8. Related deadlines include a June 15, 2026 plan-supplement deadline, a June 22, 2026 voting deadline, and a June 22, 2026 deadline to object to confirmation and to final approval of the disclosure statement.

Professional retentions. The debtor retained DLA Piper LLP (US) as chapter 11 counsel, with Debevoise & Plimpton LLP as co-counsel effective nunc pro tunc to February 19, 2026, and Kelley Drye & Warren LLP as special litigation counsel. SSG Advisors, LLC served as investment banker under a transaction-based fee structure including a monthly fee and a sale fee, Development Specialists, Inc. provided Yale Scott Bogen as restructuring advisor, and Epiq serves as claims and noticing agent.

Key Timeline

Date	Event
January 21, 2026	Chapter 11 petition; first day declaration, DIP motion, and bidding procedures motion filed
January 23, 2026	Interim DIP and cash collateral order entered
February 13, 2026	Final DIP and cash collateral order and major retention orders entered
February 17, 2026	Claims bar-date order entered
February 20, 2026	Stalking horse APA with Sons of Liberty Construction executed
March 2, 2026	Auction cancelled; SOLC named proposed successful bidder
March 16, 2026	Manski settlement motion filed
March 19, 2026	Order authorizing sale of substantially all assets to SOLC entered
April 8–9, 2026	CMB files and amends motion to appoint a chapter 11 trustee
April 13, 2026	Initial combined plan and disclosure statement and omnibus objection to CMB claims filed
April 23, 2026	Debtor objects to the trustee motion
May 13–14, 2026	Interim disclosure statement approved; solicitation plan filed; Manski settlement approved
July 7, 2026	Combined confirmation hearing scheduled

Frequently Asked Questions

What did the bankruptcy court approve in the Crescent Dunes sale?

On March 19, 2026 the court authorized the sale of substantially all of Tonopah Solar Energy's assets to Sons of Liberty Construction, Inc. free and clear of liens, for a $7 million cash purchase price. Closing remains conditioned on BLM and FERC consents, with a June 19, 2026 long-stop date subject to extension if FERC approval is the only remaining condition.

Who is buying the Crescent Dunes solar plant?

Sons of Liberty Construction, Inc. is the buyer. It signed a $7 million stalking horse agreement on February 20, 2026 and became the successful bidder after no competing qualified bids were submitted and the auction was cancelled.

Why did Tonopah Solar Energy file chapter 11 again?

The first day declaration attributes the second filing to recurring hot-salt tank failures, a reduced operating temperature that constrained output, the loss of a long-term power purchase agreement, and reliance on affiliate cash support. The Switch PPA was set to expire on February 21, 2026, and the case was filed with a prenegotiated DIP and sale structure.

What is CMB's motion to appoint a chapter 11 trustee?

CMB Export and affiliated CMB Infrastructure funds moved under section 1104 to install a trustee, arguing the debtor's management is conflicted and failed to pursue claims against insiders. The debtor opposed the motion, citing two independent managers and a special-committee investigation, and the matter remains contested heading into confirmation.

What is the status of the plan?

The debtor is pursuing a liquidating combined plan that distributes sale proceeds and winds the estate down through a Plan Administrator. The combined confirmation hearing is scheduled for July 7, 2026, with a June 22, 2026 voting and objection deadline.

Who is the claims agent for Tonopah Solar Energy?

Epiq serves as the claims and noticing agent, approved effective as of the petition date. A claims bar-date order was entered on February 17, 2026, and Epiq maintains the official claims register for the case.

For related restructuring coverage, see SunPower's $45 million bankruptcy sale, Alpine Summit Energy Partners' liquidating plan after asset sales, and Nevada Copper's 363 sale and liquidation plan.