On January 17, 2020, Lilis Energy, Inc. entered into a Seventh Amendment (the “Seventh Amendment”) to the Second Amended and Restated Senior Secured Revolving Credit Agreement dated as of October 10, 2018 (as amended, the “Revolving Credit Agreement”), among the Company, certain subsidiaries of the Company, as guarantors, the lenders party thereto, and BMO Harris Bank N.A., as administrative agent. The seventh amendment provided for the January 14, 2020 redetermination of the borrowing base under the revolving credit agreement (the “Scheduled Redetermination”). As so redetermined, the borrowing base has been set at $90 million. As previously disclosed, the Company is currently fully drawn against the previously redetermined $115 million borrowing base under the Revolving Credit Facility, and as a result of the Scheduled Redetermination, a borrowing base deficiency in the amount of $25 million is existing under the Revolving Credit Agreement (the “Borrowing Base Deficiency”). The Company will be required to repay the amount of such Borrowing Base Deficiency in four equal monthly installments, with the first payment of $6.25 million scheduled to occur on January 24, 2020. As previously disclosed, the Company is currently considering transactions to fund the repayment of the Borrowing Base Deficiency. If the Company is unable to repay the amount of the Borrowing Base Deficiency within the time period required under the Revolving Credit Agreement, an event of default would occur under the Revolving Credit Agreement.