On July 1, 2019, Fred's, Inc. and certain of its subsidiaries entered into that certain Second Amendment to Forbearance Agreement, Tenth Amendment to Credit Agreement, Fifth Amendment to Amended and Restated Addendum to Credit Agreement and Third Amendment to Security Agreement, by and among the Company and certain of its subsidiaries, the Agents and the Lenders. The Second Amendment amends the Company's existing (i) Forbearance Agreement, (ii) Credit Agreement, dated as of April 9, 2015, as amended as of October 23, 2015, December 28, 2016, January 27, 2017, July 31, 2017, August 22, 2017, April 5, 2018, August 23, 2018, May 15, 2019 and June 20, 2019 (as amended, the Credit Agreement), (iii) Amended and Restated Addendum to Credit Agreement, dated as of January 27, 2017, as amended as of July 31, 2017, August 23, 2018, October 15, 2018 and May 15, 2019 (the Addendum) and (iv) Security Agreement, dated as of April 9, 2015, as amended as of July 31, 2017 and August 23, 2018. Among other things, the Second Amendment provides for the following: the funding of a revolving loan of $10,290,411, which was made on July 1, 2019; a reduction of commitments from $115 million to $97.5 million on July 1, 2019 and a further reduction of commitments to $91 million on July 13, 2019, in each case along with corresponding decreases to the availability requirement; an agreement to continue to pursue commitment letters for a refinancing transaction; an acknowledgment of the failure to satisfy the Commitment Letter Condition; a requirement to deliver daily updates to borrowing base certificates with respect to inventory; and grants of security interests in additional collateral, including substantially all personal property and the distribution center located at 2815 GA Highway 257, Dublin, Georgia 31021, and an agreement to grant additional security interests on certain additional real property upon Agents' request.