Business Context and Reporting Period
This Form 8-K was filed by Energy Services of America Corporation on July 31, 2013. The report details an amendment to a material definitive agreement regarding a forbearance arrangement with United Bank, Inc.
Key Financial Metrics
The filing does not provide standard financial metrics such as revenue, profit, cash flow, margins, or total debt levels. The only specific financial figure disclosed is a $25,000 payment due upon execution of the amendment to the forbearance agreement.
Material Changes
The primary material change is the extension of the forbearance period originally entered into on November 28, 2012. Key changes include:
- Extension of the timeframe for the Company to raise funds and perform obligations.
- Implementation of a periodic repayment schedule from August 6, 2013, to September 30, 2013.
- Requirement of a $25,000 fee for the extension.
Outlook, Risks, and Contingencies
The Company and its subsidiaries (collectively the "Obligors") remain in default under two credit facilities with United Bank, Inc. The amendment allows the lender to continue forbearing from exercising rights and remedies. The filing notes that the Company must raise funds and perform specific obligations under the agreement to maintain this status. The full terms are qualified by the agreement filed as Exhibit 10.1.
Investor Verification Checklist
- Verify the status of the two credit facilities in default with United Bank, Inc.
- Confirm the Company's ability to meet the new periodic repayment schedule ending September 30, 2013.
- Review the full text of the Amendment to Forbearance Agreement (Exhibit 10.1) for specific covenants and default triggers.
- Assess the Company's current liquidity position given the requirement to raise funds.