You can find it in the Arena at the left upper side of the map. It should be under some rubble and rocks, and you have to kick it for the rubble to be removed.
It currently does 364 damage, which upgrades and modifications can be used on it. 4 upgrades can be used on Rais's Machete, which is one more than the usual on common weapons.
It has 5 durability fixes, which they last for a short amount of time.
You cannot replay the mission, so get it while you can!