On January 1, 2012, about 1400 central standard time, a Continental Copters Inc. 47G2 helicopter, N9021R, impacted terrain during a forced landing following a loss of tail rotor effectiveness near Lohn, Texas. The commercial pilot and passenger sustained serious injuries. The helicopter’s tailboom was substantially damaged during the forced landing. The helicopter was registered to and operated by Sky Horse Helicopters Inc. under the provisions of 14 Code of Federal Regulations Part 91 as an aerial observation flight. Day visual flight rules (VFR) conditions prevailed for the flight, which did not operate on a VFR flight plan. The helicopter departed on the local flight about 1300. The pilot stated in his accident report that he performed a preflight inspection of the helicopter to include checking the tail rotor oil level through its sight glass. He flew the helicopter for “over” an hour when the tail yawed to the left. The yaw was slow at first and then the helicopter yawed rapidly. The pilot “cut” the throttle and flew the helicopter “to the ground as fast as possible.” A logbook endorsement showed that the helicopter’s last annual inspection was completed on July 13, 2011, and that the helicopter had accumulated 8,989 hours of total flight time. The pilot reported that the helicopter had accumulated 9,057 hours of total flight time at the time of the accident and that he did not have any records in reference to the tail rotor gearbox. A Federal Aviation Administration (FAA) inspector examined the wreckage on-scene. The tail rotor gearbox did not operate when it was rotated. The FAA inspector measured the gearboxes' shim and he reported its thickness measurement as 0.015 inches, plus or minus 0.001 inches. The accident gearbox, marked with part no. 47-640-044-39 and serial no. A13-3661, was retained and was shipped to Scott’s – Bell 47 Inc. for detailed examination under FAA supervision. The examination, in part, revealed that the interior surfaces of the gearbox were covered with a black oily substance consistent with residual lubricating oil contaminated with liberated metal particles. The oil level sight glass exhibited no discoloration or other hindrance to normal oil level detection in service. Damage was noted on the upper aft portion of the main case assembly where the aft casting accommodated the tail rotor guard. This area of displaced or previously removed material was filled with a media consistent with an epoxy mix. The gearbox assembly was dismantled in accordance with procedures listed in its service instruction and no significant difficulties or abnormal conditions were encountered. Scott’s – Bell 47 Inc. report is appended to the docket material associated with this case. Parts, to include the ring and pinion gear, were removed and shipped to the National Transportation Safety Board (NTSB) Materials Laboratory. A NTSB Senior Materials Engineer examined the parts and produced Materials Laboratory Factual Report No. 13-028. The examination revealed that the teeth on the pinion gear were deformed and worn almost down to the tooth root in some locations. Wear was observed on the top land and drive faces of the ring gear. Wear patterns were noted on the coast faces of the ring and pinion gear teeth. Hardness testing revealed that both gears exhibited a trend of increasing hardness with decreasing distance from the bottom land surface. The NTSB Materials Laboratory report is appended to the docket material associated with this case.