Ultra Safe Nuclear: $28M Sale and Liquidating Plan
Ultra Safe Nuclear: $28M Sale and Liquidating Plan
ElevenFlo Research
June 9, 202615 min readUpdated September 8, 2026
Ultra Safe Nuclear Corporation filed for chapter 11 in the U.S. Bankruptcy Court for the District of Delaware on October 29, 2024, under lead case number 24-12443 (KBO). The Seattle- and Oak Ridge-based microreactor and nuclear-fuel developer entered bankruptcy with a fully negotiated exit already in hand: a $28 million all-cash stalking horse purchase agreement with Standard Nuclear, Inc. and a $23 million debtor-in-possession commitment from JMB Capital Partners Lending, LLC. This was a freefall filing engineered for a fast section 363 sale, not a reorganization.
The case carried two features restructuring professionals watch for. First, the DIP facility primed an insider-affiliated secured note held by USNC Investment, LLC, setting up a creditors' committee challenge that became the case's central litigation. Second, the debtor's distress was not industry-driven — the nuclear-startup sector was expanding — but a classic venture funding wall, with operating expenses running more than ten times revenue and a Series B round that fell through when an anchor investor never committed. The court confirmed a liquidating plan on April 10, 2025, which went effective on April 14, 2025, leaving the RPWI Liquidating Trust to distribute sale proceeds and prosecute remaining estate claims.
$23M JMB Capital Partners ($15M new money + $8M bridge roll-up), 14%
Stalking Horse
Standard Nuclear, Inc. ($28M cash)
Liquidating Trustee
Wilmington Savings Fund Society, FSB (RPWI Liquidating Trust)
Claims Agent
Stretto, Inc.
Case Snapshot
Startup Funding Wall and the Path to Filing
Founded in 2011, Ultra Safe Nuclear Corporation developed Fully Ceramic Micro-encapsulated (FCM) nuclear fuel and the Micro Modular Reactor (MMR), along with the Pylon transportable reactor concept aimed at defense and space applications. The company held 33 patents and ran development programs with NASA, the Department of Defense, and the Department of Energy from operations in Oak Ridge, Tennessee and Salt Lake City, Utah. Its products remained pre-commercial at the time of filing.
The distress was financial, not technological. The First Day Declaration of chief technology officer Kurt A. Terrani describes a pre-revenue enterprise funded almost entirely with equity and convertible debt, with an expense base that dwarfed sales. In 2023 the company reported approximately $81.2 million in operating expenses against $6.15 million in revenue, after $53.9 million in operating expenses against $5.75 million in revenue in 2022. Beginning in 2022, USNC engaged Citibank and other investment banks to raise a Series B equity round.
Several investors expressed interest, but commitments were conditioned on landing an anchor investor that never materialized. Without that capital, the company could not fund continued operations or its planned 2026 FCM fuel factory. In mid-October 2024 the board concluded that USNC had to enter a court-supervised sale process, and on October 15, 2024 it accepted a $23 million bridge and DIP commitment from JMB Capital Partners, $8 million of which was funded prepetition on October 16, 2024 to bridge the company to a filing. Trade and industry coverage framed the filing as a sale-driven chapter 11 rather than a wind-down of the technology, with the company stating it filed to facilitate a sale of its assets.
Capital Structure and the USNC Investment Insider Note
USNC entered bankruptcy with approximately $72.7 million in total funded debt and unsecured obligations. The capital structure layered an insider-held secured note over a thin trade and convertible-debt base.
The largest claim was the Prepetition Secured Note, on which $24,675,000 of principal had been advanced and which carried $28,221,044.60 in principal and accrued interest at the petition date. It was held by USNC Investment, LLC, an insider-affiliated vehicle, and secured by a lien on substantially all assets of USNC and its USNC-Tech subsidiary. Layered on top was the JMB first lien bridge loan of $8,000,000 funded on October 16, 2024 under a loan and security agreement that contemplated the full $23 million facility.
On the unsecured side, the Disclosure Statement reports $7,609,600 in aggregate principal of convertible notes held by various parties including directors and former officers, a $750,000 shareholder loan owed to Michael Lee-Chin, and an approximately $650,000 construction lien asserted by Austin Building and Design d/b/a The Austin Company for related electrical work. Trade vendors, landlords, contract counterparties, and former employees accounted for roughly $27.7 million more, bringing total general unsecured obligations to approximately $35 million.
JMB DIP Financing and the 60-Day Sale Track
The DIP financing motion sought authority for an aggregate principal amount not to exceed $23,000,000 from JMB Capital Partners Lending, LLC, structured as a non-amortizing, priming, super-priority senior secured term loan. The facility comprised $15,000,000 in new-money funding and a dollar-for-dollar roll-up of the $8,000,000 outstanding under the prepetition bridge. It was secured by a priming first lien on substantially all assets, with the Prepetition Secured Noteholder receiving customary adequate protection.
The DIP loans bore interest at 14% per annum, payable monthly in cash in arrears, with an additional 5% per annum default rate during any event of default. The maturity date was the earliest of December 31, 2024; the effective date of any chapter 11 plan; consummation of a sale of substantially all assets; acceleration after an event of default; dismissal or conversion to chapter 7; or 45 days after the petition date absent entry of a final order. A carve-out preserved statutory U.S. Trustee and Clerk fees, chapter 7 trustee fees up to $25,000, and allowed professional fees of debtor and committee professionals through a carve-out trigger, with post-trigger fees capped at an aggregate $250,000.
The financing was conditioned on a compressed sale timeline. The DIP term sheet required the debtors to enter an asset purchase agreement with Standard Nuclear for substantially all assets, entry of the interim DIP order including the roll-up within five business days of filing, entry of a final DIP order within 45 days, and entry of a sale order for substantially all assets within 60 days of the petition date. The court entered the interim DIP order on October 30, 2024 and the final DIP order on November 21, 2024, keeping the financing within its milestone schedule.
Bifurcated Sale to Standard Nuclear and Nano Nuclear
USNC filed with a committed stalking horse agreement from Standard Nuclear, Inc., dated November 21, 2024, for a $28,000,000 all-cash purchase, subject to adjustments for cure costs and assumed liabilities. The bidding procedures motion was filed on October 30, 2024, and the court entered an order approving bidding procedures on November 21, 2024. The procedures set a December 9, 2024 bid deadline, a December 12, 2024 auction, and a December 17, 2024 sale hearing — a bid deadline only 41 days after filing.
The auction produced a bifurcated outcome, and the court entered two sale orders on December 19, 2024. Under the first, Standard Nuclear acquired the FCM fuel and core MMR operating assets under the November 21, 2024 stalking horse agreement. The sale order approved the transaction free and clear with section 363(m) good-faith protection and incorporated a first amendment to the agreement reflecting bid-step adjustments and treatment of the UT-Battelle (Oak Ridge National Laboratory) license. Standard Nuclear subsequently joined a DOE fuel pilot program built on the acquired fuel technology.
A later transaction sold the equity of Global First Power Limited, USNC's Canadian subsidiary developing an MMR at Chalk River, to Kronos MMR Inc., a Nano subsidiary. The court approved that sale on September 2, 2025, with the order resolving a $641,206.61 claim asserted by the Canadian Nuclear Safety Commission against the subsidiary. Nano later announced plans to build a KRONOS microreactor at the University of Illinois.
Independent Director and the Committee Adversary
Because USNC's directors held insider claims — convertible notes and unsecured loans against the estate — the debtor reconstructed its governance to evaluate insider transactions and proposed releases. On December 7, 2024, the Series A preferred shareholders appointed Jill Frizzley as an independent director, since every other director held claims and could not impartially assess them. On January 9, 2025, the board consented to forming a special committee comprised solely of Ms. Frizzley to investigate potential claims against current and former officers, directors, and third parties.
The Official Committee of Unsecured Creditors, appointed November 13, 2024, investigated the Prepetition Note Claim held by USNC Investment, LLC, an entity tied to director Richard Hollis Helms. The Committee took two positions: that the note should be recharacterized as equity rather than treated as valid debt, and that even if it were debt, perfection of the securing liens fell within the insider preference period and was avoidable under section 547. On February 27, 2025, the Committee commenced Adversary Proceeding No. 25-50390 against USNC Investment, seeking recharacterization of more than $29 million in asserted debt, avoidance of preferential transfers, and equitable subordination. USNC Investment moved to dismiss on March 26, 2025.
The dispute resolved through a Rule 9019 settlement approved on June 23, 2025. USNC Investment's asserted claims of approximately $29,772,387.75 were reduced to a single allowed secured claim of $1,800,000.00, payable in full in cash within five business days of the order becoming final, with all other claims disallowed and expunged. The settlement order provided mutual releases covering USNC Investment, the estate of Richard Hollis Helms, and the related family trust, and dismissed the adversary proceeding with prejudice. The settlement reduced the insider note claim by roughly 94%.
Cash up to remaining proceeds (if secured) or pro rata trust interests (if unsecured)
Eliminated for voting (temporarily disallowed)
4
General Unsecured Claims
Pro rata Beneficial Trust Interests
Voted to accept
5
Intercompany Claims
No distribution / Impaired
Deemed to reject
6
Subordinated Claims
No distribution / Impaired
Deemed to reject
7
Equity Interests
No distribution / Impaired
Deemed to reject
The confirmation order, entered as combined findings of fact and conclusions of law on April 10, 2025, approved the disclosure statement and confirmed the plan in a single ruling. Intercompany, subordinated, and equity classes received no distribution, while general unsecured creditors share pro rata in beneficial interests of a liquidating trust.
The plan established the RPWI Liquidating Trust on the effective date to hold all liquidating trust assets — including remaining sale proceeds and causes of action such as the Committee challenge claims — and to prosecute claims and distribute proceeds. Wilmington Savings Fund Society, FSB serves as liquidating trustee. The plan went effective on April 14, 2025, four days after confirmation, as reflected in the notice of effective date, and the debtor entity changed its name to Reactor Parent Wind-Down, Inc.
Professional Retentions and Final Fee Awards
The debtors retained Young Conaway Stargatt & Taylor LLP as lead counsel, with Norton Rose Fulbright as co-counsel, Ankura Consulting Group, LLC as financial and restructuring advisor, and Intrepid Investment Bankers LLC as investment banker. The Official Committee retained Seward & Kissel LLP as counsel, Potter Anderson & Corroon LLP as Delaware co-counsel, and Emerald Capital Advisors as financial advisor. Stretto, Inc. served as claims, noticing, and administrative advisor under a retention order entered October 30, 2024.
The court entered omnibus final fee orders on June 5, 2025, covering both the debtors' professionals and the committee professionals, with Intrepid's fee approved separately on February 20, 2025. Total final awards came to roughly $7.5 million across all estate and committee professionals.
Professional
Role
Final Fees
Final Expenses
Young Conaway Stargatt & Taylor LLP
Debtors' counsel
$1,876,490.50
$32,954.11
Ankura Consulting Group, LLC
Debtors' financial advisor
$1,106,614.25
$3,120.63
Intrepid Investment Bankers LLC
Debtors' investment banker
$2,350,000.00
$14,883.28
Stretto, Inc.
Administrative advisor
$27,115.85
$0.00
Seward & Kissel LLP
Committee counsel
$563,869.90
$429.90
Potter Anderson & Corroon LLP
Committee Delaware counsel
$310,916.77
$1,473.77
Emerald Capital Advisors
Committee financial advisor
$1,180,232.38
$7,348.63
Intrepid Investment Bankers' $2,350,000 award — the single largest — reflected the investment banker's sale-process compensation and was approved net of one monthly fee credit per its retention order.
Post-Confirmation Wind-Down and Preference Actions
The RPWI Liquidating Trust has administered the estate through quarterly post-confirmation reporting, claims reconciliation, and chapter 5 recovery actions since the April 14, 2025 effective date. As of the report for the quarter ending March 31, 2026, the liquidating trustee reported cumulative distributions of $2,427,671, all paid to holders of secured claims, and characterized claims reconciliation as ongoing with allowed-claim figures still drawn from the disclosure statement estimates. The Q1 2026 post-confirmation report was filed April 23, 2026.
The trustee has pursued preference recoveries under sections 547 and 550. In Adversary Proceeding No. 26-50222, filed March 20, 2026, Wilmington Savings Fund Society, FSB, as liquidating trustee, sued Oxy-Gon Industries, Inc. to avoid and recover preferential transfers of not less than $43,819.58 made during the July 31 through October 29, 2024 preference period. The preference complaint targets transfers made in the run-up to the petition. The trust has also obtained repeated extensions of its claims-objection and removal deadlines and resolved individual claims by stipulation as reconciliation continues into 2026.
Key Timeline
Date
Event
2011
Ultra Safe Nuclear Corporation founded
Oct. 15, 2024
$23M loan and security agreement with JMB Capital Partners; $8M bridge funded Oct. 16
Oct. 29, 2024
Chapter 11 petition filed in D. Del. (Case No. 24-12443)
Oct. 30, 2024
Bidding procedures motion filed; interim DIP order entered
Nov. 13, 2024
Official Committee of Unsecured Creditors appointed
Nov. 21, 2024
Final DIP order and bidding procedures order entered; Standard Nuclear stalking horse agreement executed
Dec. 7, 2024
Jill Frizzley appointed independent director
Dec. 9–17, 2024
Bid deadline, auction, and sale hearing
Dec. 19, 2024
Sale orders entered for Standard Nuclear and Nano Nuclear Energy
Jan. 9, 2025
Special Committee formed
Feb. 27, 2025
Committee files Adversary 25-50390 against USNC Investment
Apr. 10, 2025
Combined disclosure statement approval and plan confirmation order entered
Apr. 14, 2025
Plan effective date
Jun. 23, 2025
USNC Investment settlement approved; claim cut to $1.8M allowed secured
Sep. 2, 2025
GFPL equity sale to Kronos MMR approved
Mar. 20, 2026
Trustee files preference Adversary 26-50222 against Oxy-Gon Industries
Who is the claims agent for Ultra Safe Nuclear Corporation?
Stretto, Inc. serves as the claims, noticing, and administrative advisor. The firm's retention was authorized under an order entered October 30, 2024, covering claims registration, noticing, and administrative advisory services through the post-confirmation wind-down.
What happened to Ultra Safe Nuclear's reactor and fuel technology?
The court approved two sales on December 19, 2024. Standard Nuclear, Inc. acquired the FCM fuel and core MMR operating assets for $28 million, while Nano Nuclear Energy Inc. acquired the MMR and Pylon transportable reactor intellectual property for $8.5 million.
Did equity holders recover anything in the USNC bankruptcy?
No. Under the confirmed liquidating plan, equity interests were placed in Class 7, received no distribution, and were deemed to reject the plan. Intercompany and subordinated claims were likewise wiped out.
This article was researched and written with AI assistance, using court filings, public records, and news sources. AI-generated content can contain errors. Verify all information against primary sources before relying on it. This is not legal or financial advice. Read our full disclaimer.
