In a courtroom showdown reminiscent of a high-stakes poker game, AgileThought Inc., the tech company navigating Chapter 11, won a major victory as a Delaware bankruptcy judge granted preliminary approval for them to secure nearly $23 million in debtor-in-possession (DIP) financing. This unexpected turn of events unfolded after AgileThought brokered an agreement with a previously objecting lender and initiated settlement discussions with unsecured creditors.

AgileThought $23M DIP Approval : Interim Approval with a Silver Lining

U.S. Bankruptcy Judge J. Kate Stickles dealt the cards, giving AgileThought the green light for an interim DIP financing arrangement, made possible through the cooperative efforts of first-lien lender Blue Torch Finance. This package included a surprising twist, with the second-lien lender, formerly in opposition, pledging not to obstruct potential resolutions with the unsecured creditors' committee.

"We wanted to at least put that issue behind us in anticipation of next week having a consensual resolution with the committee," stated Blue Torch counsel Gregg Galardi, underscoring the ever-changing nature of this legal duel.

AgileThought's Battle in the Bankruptcy Arena

AgileThought Inc. and over 30 affiliated companies entered the arena of Chapter 11 bankruptcy, carrying a heavy load of $110 million in prepetition debt. Their prepetition plans to sell off assets were derailed when prospective buyers were spooked by a contentious $203 million tax bill afflicting their Mexican affiliates.

Blue Torch Finance boldly stepped forward, offering a $100 million stalking horse credit bid for an auction set for early November. Their proposal for a DIP package totalling $22.7 million in fresh capital and a roll-up of $97.2 million in first-lien debt seemed poised to reign supreme.

However, the Credit Suisse Mexico Opportunities Fund, holding interests in two trusts laden with $13.1 million in second-lien debt, raised the stakes by arguing that the DIP arrangement would contravene a senior-junior lender agreement that imposes a cap on how much second-lien debt can be subordinated behind DIP financing in a bankruptcy scenario.

At a hearing just a fortnight ago, Blue Torch made a strategic maneuver by agreeing to excise the first-lien rollup from their package. Judge Stickles concurred, allowing a bridge financing agreement while the parties engaged in a consensual interim DIP order.

Agreements on the Horizon: A Thrilling Turn of Events

In a dramatic courtroom crescendo at Wednesday's hearing, AgileThought counsel Jeremy Ryan announced that AgileThought, Blue Torch, Credit Suisse, and the unsecured creditors' committee had orchestrated an agreement regarding the interim order. Optimism rippled through the courtroom as Ryan declared that the final DIP motion could evolve into a fully consensual decision.

The interim order included a pact in which Credit Suisse vowed not to oppose any settlements reached with the committee by AgileThought or Blue Torch, provided these agreements did not encroach upon secured lender collateral or violate the first lien-second lien intercreditor agreement.

In response to Judge Stickles' inquiries about this clause, Galardi revealed that settlement negotiations with the committee were still in progress, keeping the audience on the edge of their seats.

AgileThought $23M DIP Approval : Legal Titans in the Ring

AgileThought was represented by a formidable legal team, including Jeremy W. Ryan, R. Stephen McNeill, Gregory J. Flasser, and Sameen Rizvi of Potter Anderson & Corroon LLP, and Kathryn A. Coleman, Christopher Gartman, Jeffrey S. Margolin, and Elizabeth A. Beitler of Hughes Hubbard & Reed LLP.

The Credit Suisse Mexico Opportunities Fund was defended by Joseph O. Larkin, Stephen J. Della Penna, James J. Mazza Jr., and Robert E. Fitzgerald of Skadden Arps Slate Meagher & Flom LLP.

Blue Torch had their legal champions in Mark L. Desgrosseilliers of Chipman Brown Cicero & Cole LLP, along with Gregg M. Galardi and Lindsay C. Barca of Ropes & Gray LLP.

The unsecured creditors' committee was represented by a seasoned team, including Colin R. Robinson, Robert J. Feinstein, Bradford J. Sandler, Cia H. Mackle, and Edward Corma of Pachulski Stang Ziehl & Jones LLP.

In this enthralling legal saga, AgileThought's $23 million DIP approval has now secured its place as one of the most captivating chapters in the world of corporate bankruptcy.