The US Bankruptcy Court gave an order to Avaya, Inc. to obtain DIP financing on an interim basis on February 15, 2023. As per the order, the debtor has been authorized to obtain a term loan in the amount of $400 million out of $500 million and $128 million of revolving credit facility, where Wilmington Savings Fund Society, FSB acting as the administrative agent. The DIP loan would either carry an interest rate of SOFR plus 8% p.a., along with an additional interest in the event of default.

As per the terms of the DIP agreement, the loan carries a term upfront fee of 4% p.a., put option premium equal to 6% of aggregate principal amount, an exit fee of equal to 1% of the sum of the principal amount, a fronting fee equal to 0.375% of the aggregate commitments as of the closing date. The DIP facility would mature either on March 31, 2023, i.e., 45 days after the petition date if the final order has not been entered or six months after the closing date or on the effective date of the plan or on the date of consummation of the sale of substantially all assets, whichever is earlier. Adequate protection would be provided to the DIP lenders in the form of super-priority administrative expense claims which is subject to a carve-out of $0.10 million towards unpaid professional fees / administrative expenses and first priority lien upon and security interest in the debtor's collateral.

The final hearing shall be scheduled for March 7, 2023.