The development builds on a strategic review initiated by Boart in February and represents the company’s ongoing efforts to fend off negative attention such as a ratings downgrade by Standard & Poor’s and a Wall Street Journal report that the driller was heading for administration.

The new terms for the company’s bank credit agreement reduce the minimum earnings before interest, tax, depreciation and amortisation for the covenant covering the last 12 months.

This EBITDA covenant has been set at $US35 million ($A37.5 million) through the March 2015 compliance testing date, compared to $45 million during the June-quarter compliance period.

The amendments also increase the maximum permitted gross debt to $715 million at the September 30 testing date.

Available lending commitments remain unchanged at $140 million.

“We thank our bank group for their continued willingness to provide the company with a favourable and constructive amendment to our credit agreement,” Boart president and chief executive Richard O’Brien said.

“Our forecasts for 2014 and early 2015 indicate that we expect to be in compliance with prior covenants for those periods, but we though it prudent to provide the company with additional head room under the covenants as we continue to pursue a recapitalisation solution through the ongoing strategic review process.”

Last month, a preliminary filing by the company confirmed a 35.7% year-on-year drop in June quarter revenue at $224.1 million.

Adjusted EBITDA for the quarter fell 64.8% compared to the previous corresponding period to $14.1 million.