According to a related 8-K filing, a portion of this exit facility, was borrowed to pay off the outstanding loans under the DIP credit agreement. Availability under the exit facility is limited by a borrowing base, calculated based on the debtors’ eligible accounts receivable and eligible inventory, less reserves.
The exit facility includes a subfacility in an amount to be agreed for the issuance of letters of credit. Interest on the exit facility will accrue at a rate per year equal to the LIBOR rate (with a floor of 1.00%) plus 5.50% or alternate base rate plus 4.50%.
The exit facility will mature on the third anniversary of its effective date.
Proceeds of the exit facility can be used by the debtors to, among other things, make capital expenditures, to fund the debtors’ general business purposes, including working capital requirements and to pay certain fees and expenses related to the consummation of the exit facility and the plan, in each case subject to certain limitations provided in the exit facility.
On the effective date, the senior secured priming and superpriority debtor-in-possession credit and security agreement the partnership previously entered into with the Emerge Subsidiaries, HPS Investment Partners, as administrative agent, and the lenders party thereto was paid in full and terminated.
Emerge Energy Services is a growth-oriented limited partnership engaged in the businesses of mining, producing, and distributing silica sand, a key input for the hydraulic fracturing of oil and natural gas wells.