Sports Direct, controlled by billionaire Mike Ashley, last year bought department store chain House of Fraser out of administration for 90 million pounds and has been trying to wrest control of Debenhams for months. It already owns a near 30 percent stake.
The 241-year-old Debenhams said Sports Direct needed to either make a firm offer for the group, underwrite a rights issue, or provide debt funding if it wanted to prevent Debenhams' ownership falling into the hands of lenders.
Shares in Debenhams, down 86 percent over the last year, rose 39 percent, on hopes Sports Direct would make a bid.
"Ashley's now between a rock and a hard place. He faces either seeing his stake in Debenhams disappear, or having to stump up cash to keep shares in the company alive," said Hargreaves Lansdown analyst Laith Khalaf.
Debenhams said on Friday the 200 million pounds was in two facilities. A first of 101 million pounds has been drawn but the second of 99 million pounds is subject to one of various "milestones" being reached by April 8.
These include Sports Direct making a firm offer for the company that includes a refinancing of its debt and sufficient working capital.
Alternatively Sports Direct can cancel its request for a meeting of shareholders to remove Debenhams' entire board, apart from its finance chief, and instead make a commitment to either underwrite a rights issue or provide debt funding.
"If these milestones are not satisfied, the second facility would be available to the group's subsidiaries only upon transfer of those subsidiaries into the ownership of a lender-approved entity," Debenhams said.
While this outcome would allow the business to continue trading "it would very likely result in no equity value for the company's current shareholders."
Debenhams said it would also move to the next phase of its restructuring, which includes reducing rents and closing stores.
"We will be contacting Sports Direct to outline once again the terms on which their constructive participation would be possible," said Debenhams.
Sports Direct said earlier on Friday it was considering its options.
On Wednesday Sports Direct had said it was weighing a 61.4 million pound offer for the company - a proposal conditional on Ashley immediately being installed as Debenhams' chief executive and the firm abandoning its refinancing plan.
Shares in Debenhams were up 0.72 pence at 2.86 pence at 1239 GMT, valuing the equity at 34.4 million pounds.
(Reporting by James Davey; editing by Alistair Smout and David Evans)