Delayed draw term loan (DDTL)
A committed term facility drawn in stages during an agreed availability period, subject to conditions for each borrowing.
How it works
A delayed draw term loan (DDTL) is committed at signing but drawn in instalments during an availability period, rather than in one amount on day one. Each draw must meet conditions, and undrawn commitments usually carry a commitment fee. Once the availability period ends, undrawn amounts are cancelled and the drawn loan amortises or is repaid at maturity.
In GPU and data centre deals
DDTLs are the standard structure for GPU financings because GPUs are delivered and accepted in batches over months. Each draw typically funds a batch of servers once delivered, installed and accepted by the customer. The facility is sized on the customer contracts behind the GPUs, and draws are limited by loan to cost and contract-based tests. Several large neocloud programmes have been financed through numbered series of DDTLs.
What gets negotiated
- Length of the availability period and how it matches the delivery schedule
- Draw conditions: delivery, installation, customer acceptance and no default
- Commitment fee on undrawn amounts
- Sizing tests applied at each draw
Why the distinction matters
Match funding to eligible deliveries and signed contracts. The headline commitment is not the amount already borrowed, and undrawn availability can expire.
Read the structure
How GPU collateral and customer cash flows support lending, and where the two can diverge.
GPU-backed loans: contracts, equipment and repayment ↗In the filed deals
CoreWeave's DDTLs run from DDTL 1.0 (US$2.3bn, 2023, SOFR + 8.75%) to DDTL 4.0 (US$8.5bn, 2026, SOFR + 2.25%).
For in-house counsel
Delayed draw term loan in the filed documents
Where the term turns up in filed contracts and what is market, for the lender’s or the borrower’s side. Previews are open; the full text is free with InfraCompute Weekly.
- Checklist: GPU delayed draw term loan, conditions precedentThe documents and evidence lenders usually ask for before a GPU facility closes and before each draw. The filed facilities differ…
- What’s market: Contract value ratio and customer breach triggersDo GPU lenders test the value of the remaining customer contract?
- What’s market: Equity cure limits in GPU loansHow many times can a sponsor cure a covenant breach with equity?
- The legal desk for in-house counselContract library, issues lists, checklists and English law notes.
Related terms
Explanatory definition, not a statement that a particular transaction contains this term or a substitute for its contractual definition.
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