Banking on New Capital
“The debtors are still left without liquidity and without means to fund their operations which, if operations cease, the debtors’ business is seriously jeopardized,” the companies wrote. The filings stress that the Chapter 11 petitions were intended to preserve value, attract new capital, and protect stakeholders.
Customers including Halliburton rely on the companies’ high-quality quartz sand, a key component in hydraulic fracturing. Despite a recent rebound in drilling and customer orders, the debtors said they lack the cash flow to sustain operations.
Postpetition Financing in Play
The secured lender represents participants with roughly $26 million in claims, according to filings. To stay afloat, the companies are finalizing a debtor-in-possession financing package, including an interim draw of $1.5 million and a potential total of $6 million.
The debtors, represented by attorneys Davor Rukavina and J. Kyle Jaksa of Munsch Hardt Kopf & Harr PC, did not immediately respond to requests for comment.
