Integrated Drilling Equipment Holdings Corp., Integrated Drilling Equipment, LLC and Integrated Drilling Equipment Company Holdings, LLC (collectively with the borrowers) entered into the fourth amendment to term loan and security agreement and forbearance agreement with Elm Park Credit Opportunities Fund, L.P. and Elm Park Credit Opportunities Fund (Canada), L.P., as lenders, and Elm Park Capital Management, LLC, as administrative agent
to, among other things, (1) amend the maturity date of the term facility from June 30, 2015 to September 30, 2015; (2) amend the capital expenditures covenant to limit capital expenditures to not greater than (a) $2,000,000 for the twelve months ended December 31, 2014, (b) $300,000 for the three months ended March 31, 2014 and (c) $500,000 for the nine months ended September 30, 2015; and (3) add a new covenant requiring that with respect to the borrowers rig yard division business, for the period of 90 consecutive days ending March 31, 2015, and for each period of 90 consecutive days ending on the last day of any month ending thereafter, the borrowers not incur operating losses in an aggregate amount exceeding $400,000 in any such 90 consecutive day period. In addition, the fourth term loan amendment provides that during the period beginning December 31, 2014 and ending on the earlier of (a) the occurrence of a termination event or (b) 5:00 pm Dallas time on March 31, 2015, the lenders under the term facility agree to forbear from commencing any enforcement action as a result of certain existing defaults or the borrowers failure to comply with either the fixed charge coverage ratio covenant or minimum EBITDA covenant in the term loan agreement for the quarters ended December 31, 2014 or March 31, 2105, so long as the borrowers (1) have at least $5,000,000 in EBITDA, measured monthly on a trailing twelve-month basis (with an add-back for a one-time severance payment of $2,520,120 previously made to Stephen Cope); (2) have a fixed charge coverage ratio of at least 1.0 to 1.0, measured monthly on a trailing twelve-month basis (with an add-back for a one-time severance payment of $2,520,120 previously made to Stephen Cope); (3) furnish the agent and lenders with a forbearance compliance certificate, in form and substance reasonably satisfactory to the agent and lenders, within thirty days after the end of each month; (4) diligently pursue a financing commitment from a third party financing source, the proceeds of which will be used to repay all obligations under the revolving facility; and (5) deliver a weekly status report to the agent regarding the status of all actions taken to seek such financing commitment.