FORBEARANCE AGREEMENT

Exhibit 10.1

FORBEARANCE AGREEMENT

This FORBEARANCE AGREEMENT (“ Agreement ”), dated as of October 8, 2009, is entered into by and among GREAT AMERICAN GROUP ENERGY EQUIPMENT, LLC, a California limited liability company (“ Borrower ”), the Lenders party hereto and GARRISON LOAN AGENCY SERVICES LLC (“ GLAS ”), as Administrative Agent for the Lenders (“ Administrative Agent ”). Unless otherwise defined above or elsewhere in this Agreement, capitalized terms used herein shall have the meanings ascribed to them in the Credit Agreement (as hereinafter defined).

RECITALS:

WHEREAS, the Borrower, the Guarantor party thereto, the Lenders party thereto and the Administrative Agent have entered into that certain Credit Agreement, dated as of May 29, 2008 (as has been amended, restated, supplemented or otherwise modified from time to time, the “ Credit Agreement ”);

WHEREAS, on September 26, 2009 the Maturity Date occurred and Borrower and Guarantor failed to repay the principal amount of all outstanding Loans, due and unpaid interest and all other Obligations under the Credit Agreement and the other Loan Documents, notwithstanding that such Obligations have become due and payable in full, and such Obligations remain due and payable and unpaid (the “ Payment Defaults ”);

WHEREAS, the Non-Payment Defaults (as hereinafter defined) have occurred and are continuing under the Credit Agreement and Security Agreement none of which has been cured or waived;

WHEREAS, as a result of the Specified Defaults (as hereinafter defined), the Collateral Agent has the rights specified under Section 4.01 of the Security Agreement to, among other rights, take possession of the Article 9 Collateral and to exercise any or all other rights of a secured party under the Uniform Commercial Code;

WHEREAS, in an effort to repay the Obligations and to maximize the value of the assets, Borrower and Guarantor have determined to effectuate a sale of Borrower’s assets pursuant to an auction;

WHEREAS, the Borrower has requested that Administrative Agent and the Lenders forbear from the exercise of remedies available to them as a result of the Specified Defaults; and

WHEREAS, in reliance on Borrower’s determination to dispose of its assets, the Administrative Agent and the Lenders are willing to forbear from exercising their rights and remedies under the Loan Documents subject to the terms and conditions hereinafter set forth, provided that Borrower and the Guarantor comply with the terms of this Agreement.

NOW, THEREFORE, in consideration of the mutual agreements contained in the Credit Agreement and the other Loan Documents and herein, and for other good and valuable

consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

(a) The “ Effective Date ” of this Agreement shall be 12:01 a.m. New York City time on September 27, 2009.

(b) “ Forbearance Period ” shall mean the period beginning on the Effective Date of this Agreement and ending at 12:01 a.m. New York City time on the earlier to occur of (i) the occurrence of any Forbearance Default and (ii) November 17, 2009.

(c) “ Forbearance Default ” shall mean any of the following: (i) the occurrence of any Event of Default other than the Specified Defaults; (ii) the failure of Borrower or Guarantor timely to comply with any term, condition, or covenant set forth in this Agreement; (iii) the failure of any representation or warranty made by Borrower or Guarantor under or in connection with this Agreement to be true and complete in all material respects as of the date when made or deemed made; (iv) the filing of any petition (voluntary or involuntary) under the insolvency or bankruptcy laws of the United States or any state thereof, or of any foreign jurisdiction, with respect to Borrower, Guarantor, any of their Affiliates, or any of their Subsidiaries; or (v) any postponement of the Auction Date (as hereinafter defined) or modification of any term or provision of the Auction Services Agreement (as hereinafter defined) including, without limitation, any change to the Acceptable Reserve Pricing (as hereinafter defined).

(d) “ Non Payment Defaults ” shall mean, collectively, (i) the Defaults and Events of Defaults asserted by the Administrative Agent and expressly referred to in that certain letter dated as of December 10, 2008 from the Administrative Agent to Borrower and (ii) the Event of Default arising directly as a result of the existence of the Tax Lien.

(e) “ Specified Defaults ” means the Payment Defaults and the Non Payment Defaults.

(f) “ Tax Lien ” shall mean the Lien or purported Lien asserted by (i) the treasurers of each of Blaine, Logan and Kingfisher Counties, Oklahoma, in the aggregate amount of $220,000, for unpaid and overdue property taxes for the 2007 and 2008 tax years and (ii) the Klein Independent School District, Texas, in the aggregate amount of $29,000 for the 2007 tax year.

Each of the Borrower and Guarantor represents, warrants, acknowledges and agrees that:

(a) As of the Maturity Date, the aggregate principal balance of the outstanding Obligations under the Credit Agreement is not less than $10,485,500.62;

(b) The amount specified in clause (a) does not include interest (the amount of that is due and payable as of the Maturity Date is not less than $1,966,097.99), fees, expenses and other amounts which are chargeable or otherwise reimbursable under the Credit Agreement and the other Loan Documents;

(c) As of the date hereof, the applicable interest rate under the Credit Agreement is 20%;

(d) Each of the Specified Defaults constitutes an Event of Default that has occurred and is continuing as of the date of this Agreement;

(e) None of the Specified Defaults has been cured as of the Effective Date;

(f) Except for the Specified Defaults, no other Defaults or Events of Default have occurred and are continuing as of the date hereof, or are expected to occur during the Forbearance Period, as the case may be;

(g) Prior to, and from and after the Effective Date, the Specified Defaults: (i) except to the extent expressly provided in Section 7 of this Agreement, relieves the Lenders from any obligation to extend any Loan or provide other financial accommodations under the Credit Agreement or other Loan Documents (including consenting to Borrower’s or Guarantor’s use of cash collateral); and (ii) permits the Administrative Agent, Collateral Agent, Lenders and other Secured Parties, as the case may be, to, among other things, (A) make other extensions of credit under any or all of the Credit Agreement and the other Loan Documents, (B) accelerate all or any portion of the Obligations, (C) commence any legal or other action to collect any or all of the Obligations from Borrower and/or any Collateral, (D) foreclose or otherwise realize on any or all of the Collateral, and/or appropriate, set-off and apply to the payment of any or all of the Obligations, any or all of the Collateral, and/or (E) take any other enforcement action or otherwise exercise any or all rights and remedies provided for by any or all of the Credit Agreement, the other Loan Documents or applicable law. For the avoidance of doubt, each of Borrower and Guarantor represents, warrants, acknowledges and agrees that as a result of the Specified Defaults, the Obligations have become, and remain, immediately due and payable in their entirety.

Except as expressly set forth in this Agreement, no Lender or other Secured Party has waived or is by this Agreement waiving, and no Lender or other Secured Party has any intention of waiving, any other provisions of the Loan Documents, any Default or Event of Default which may be continuing on the date hereof or any Event of Default which may occur after the date hereof (whether the same or similar to the Specified Defaults or otherwise).

(a) As of the Effective Date, each of the Lenders and the Administrative Agent agrees that until the expiration or termination of the Forbearance Period, it will forbear from exercising its default-related rights and remedies against Borrower or Guarantor arising solely with respect to the Specified Defaults; provided , however , (i) the Obligations shall continue to bear interest as specified herein, (ii) the Lenders shall have no obligation to make any further

Loans or make other extensions of credit to Borrower or Guarantor, (iii) Borrower and Guarantor shall comply with all limitations, restrictions or prohibitions that would otherwise be effective or applicable under the Credit Agreement or any of the other Loan Documents during the continuance of any Event of Default, (iv) except as otherwise expressly set forth herein, nothing herein shall restrict, impair or otherwise affect any Lender’s or other Secured Party’s other rights and remedies under any agreements, including, without limitation, any agreement containing subordination provisions in favor of any or all of the Lenders or amend or modify any provision thereof, (v) nothing herein shall restrict, impair or otherwise affect Administrative Agent’s right to file, record, publish or deliver a notice of default or document of similar effect under any state foreclosure law and (vi) nothing herein shall restrict, impair or otherwise affect Administrative Agent’s and Lenders’ rights referred to herein.

(b) Any Forbearance Default shall constitute an immediate Event of Default under the Credit Agreement. No Forbearance Default shall be a Specified Default.

(c) Upon the occurrence of a Forbearance Default, the agreement of the Lenders hereunder to forbear from exercising their respective default-related rights and remedies shall immediately terminate without the requirement of any demand, presentment, protest, or notice of any kind, all of which Borrower and Guarantor each waives; provided , however , the Lenders agree to provide notice of any such Forbearance Default to the Borrower, but the failure to provide such notice shall not affect the occurrence or existence of any such Forbearance Default or delay or modify any of the Administrative Agent’s and Lenders’ rights. Borrower agrees that any or all of the Lenders and other Secured Parties may at any time thereafter proceed to exercise any and all of their respective rights and remedies under any or all of the Credit Agreement and any other Loan Document and/or applicable law, including, without limitation, their respective rights and remedies with respect to the Specified Defaults. Without limiting the generality of the foregoing, upon the occurrence of a Forbearance Default, the Lenders may, in their sole discretion and without the requirement of any demand, presentment, protest, or notice of any kind, (i) suspend or terminate any commitment to provide Loans or other extensions of credit under any or all of the Credit Agreement and other Loan Documents, (ii) continue to charge interest on any or all of the Obligations in accordance with the Credit Agreement, (iii) commence any legal or other action to collect any or all of the Obligations from Borrower, Guarantor and/or any Collateral, (iv) foreclose or otherwise realize on any or all of the Collateral, and/or appropriate, setoff or apply to the payment of any or all of the Obligations and any or all of the Collateral, and (v) take any other enforcement action or otherwise exercise any or all rights and remedies provided for by any or all of the Loan Documents and/or applicable law, all of which rights and remedies are fully reserved by the Lenders.

(d) Any agreement by the Lenders to extend the Forbearance Period, if any, must be set forth in writing and signed by a duly authorized signatory of each of the Administrative Agent, Borrower, Guarantor and the Lenders under the Credit Agreement.

(e) Borrower and Guarantor each acknowledges that, although the Administrative Agent has not denied Borrower’s request to discuss an extension of the Forbearance Period after the auction referred to herein is conducted, neither the Administrative Agent nor any of the Lenders have made any assurances concerning any

possibility of an extension of the Forbearance Period or the terms and conditions of any such possible extension.

(f) The parties hereto agree that the running of all statutes of limitation or doctrine of laches applicable to all claims or causes of action that any Lender or other Secured Party may be entitled to take or bring in order to enforce its rights and remedies against Borrower or Guarantor is, to the fullest extent permitted by law, tolled and suspended during the Forbearance Period.

(g) Borrower and Guarantor each acknowledges and agrees that any Loan or other financial accommodation which any Lender makes (or may be deemed to make) on or after the Effective Date has been made by such party in reliance upon, and is consideration for, among other things, the general releases and indemnities contained in this Agreement and the other covenants, agreements, representations and warranties of Borrower and Guarantor hereunder.

Borrower and Guarantor, in an effort to repay the Obligations, have determined that it is in the best interests of them and their creditors to effectuate a sale of the Borrower’s assets by way of an auction to be managed by an Auction Services Company, and that each such determination is, in the opinion of each of Borrower and Guarantor, commercially reasonable. Accordingly, each of Borrower and Guarantor hereby covenants and agrees to comply with the following terms, conditions and covenants during the Forbearance Period, in each case notwithstanding any provision to the contrary set forth in this Agreement, the Credit Agreement or any other Loan Document:

(a) Retention of Auction Services Company . As of the Effective Date, and thereafter at all times during the Forbearance Period, Borrower shall have engaged and retained, at its cost and expense, an auction services company reasonably acceptable to the Administrative Agent (it being agreed that Great American Group, LLC is acceptable to the Administrative Agent) (an “ Auction Services Company ”), in connection with the sale of Borrower’s assets, to, among other things, (a) organize, implement, manage and conduct an auction of the Borrower’s assets, (b) oversee and control the liquidation, disposal and removal of all assets sold at the auction, (c) implement appropriate advertising to effectively sell the assets at the auction, (d) tag and catalogue the assets for the auction and (e) provide such other related services deemed necessary or prudent by the Borrower to effectively conduct the auction and maximize the value of the assets subject to such sale. The Auction Services Company shall undertake all services in a manner that is consistent in every material respect with any auction for which such company is engaged by a Person other than its Affiliate.

(b) Auction Process . Deliver to the Administrative Agent on or before: (A) (i) October 8, 2009, marketing materials relating to Borrower’s proposed auction, and such materials shall have been approved by and acceptable to the Auction Services Company and the

Administrative Agent prior to distribution to potential purchasers, and such materials shall specify the Auction Date as the date of the auction (it being agreed by the Administrative Agent that such materials have been delivered and approved by and acceptable to the Administrative Agent, and Borrower and Guarantor hereby certify that such materials also have been delivered to and approved by the Auction Services Company and further certify that such materials are commercially reasonable) and (ii) October 12, 2009, evidence acceptable to the Administrative Agent that the materials referred to in clause (i) have been distributed to potential purchasers; and (B) October 12, 2009, the reserve prices established under the Auction Services Agreement with respect to the Borrower’s assets to be subject to auction (with such prices to be satisfactory to the Administrative Agent) (the “Acceptable Reserve Pricing” ) and cause such Acceptable Reserve Pricing to have been incorporated into the Auction Services Agreement. Together with each deliverable referred to in this clause (b), Borrower also shall deliver a writing signed by Borrower and Guarantor certifying that, in their opinions, the materials, scope of distribution and reserve prices are commercially reasonable.

(c) Auction . On or before November 3, 2009 (the “Auction Date” ), the Borrower shall cause the Auction Services Company to conduct an auction (it being agreed by the Borrower and Guarantor that such date is a commercially reasonable date) substantially in accordance with the terms and provisions of the Auction Services Agreement, and Borrower shall permit a representative of the Administrative Agent to be present at such auction. In compliance with the Credit Agreement and for the avoidance of doubt, any request to release a Lien on any asset shall be subject to approval or disapproval by the Administrative Agent. All proceeds received as a result of the auction shall be utilized by the Borrower to repay the Obligations (except to the extent set forth in Section 7 of this Agreement) and, accordingly, shall be paid by the buyer(s) directly to the Collection Account (or such other account as designated in writing by the Administrative Agent).

(d) Other . Promptly following any such request, Borrower shall provide all other available financial and operational information of Borrower that is reasonably requested by the Administrative Agent.

(e) General Cooperation from Borrower . Borrower shall, and shall cause its officers, other members of senior management and advisors (including, without limitation, the Auction Services Company) to, cooperate fully with Administrative Agent, Collateral Agent and/or the Lenders and any of its or their respective advisors in furnishing information as and when reasonably requested by any of them regarding the matters described in this Agreement, the Collateral or Borrower’s financial affairs, finances, financial condition, business and operations. Borrower authorizes Administrative Agent, Collateral Agent and/or the Lenders and any of its or their respective advisors to meet and/or have discussions with any of their officers, other members of senior management and advisors (including, without limitation, the Auction Services Company) from time to time as reasonably requested by Administrative Agent, Collateral Agent and/or the Lenders or any of its or their respective advisors to discuss any matters regarding the matters described in this Agreement, the Collateral or Borrower’s financial affairs, finances, financial condition, business and operations, and shall direct and authorize all such persons and entities to fully disclose to Administrative Agent, Collateral Agent, any of the Lenders and any of its or their respective advisors all information reasonably requested by any of them regarding the foregoing.

(f) Prohibition Against Voluntary Repayment of Other Indebtedness . Borrower agrees that it shall not voluntarily prepay, redeem or repurchase any principal of, or

interest or other amounts owing with respect to, any Indebtedness other than the Obligations during the Forbearance Period.

(a) In consideration of, among other things, Administrative Agent’s and Lenders’ execution and delivery of this Agreement, each of Borrower and Guarantor, on behalf of itself and its agents, representatives, officers, directors, advisors, employees, subsidiaries, affiliates, successors and assigns (collectively, “ Releasors ”), hereby forever agrees and covenants not to sue or prosecute against any Releasee (as hereinafter defined) and hereby forever waives, releases and discharges, to the fullest extent permitted by law, each Releasee from any and all claims (including, without limitation, crossclaims, counterclaims, rights of set-off and recoupment), actions, causes of action, suits, debts, accounts, interests, liens, promises, warranties, damages and consequential damages, demands, agreements, bonds, bills, specialties, covenants, controversies, variances, trespasses, judgments, executions, costs, expenses or claims whatsoever (collectively, the “ Claims ”), that such Releasor now has or hereafter may have, of whatsoever nature and kind, whether known or unknown, whether now existing or hereafter arising, whether arising at law or in equity, against the Collateral Agent, Administrative Agent and any or all of the Lenders and/or any other Secured Party in any capacity and their respective affiliates, subsidiarie