Katapult (KPLT) Proxy Filing summary

Executive summary

• Entered into an Amended and Restated Loan and Security Agreement, increasing the revolving credit facility to $110 million and continuing a $32.65 million term loan, both secured by substantially all assets.

• The new revolving facility includes a $20 million tranche of new commitments and features step-up advance rates contingent on shareholder approval and performance milestones.

• The term loan is convertible into common stock at a discount to market price, subject to shareholder approval, with a maximum conversion of up to 80% of equity.

• Issued new warrants to purchase 486,264 shares at $0.01 per share, exercisable under various conditions, potentially resulting in significant dilution.

• The agreement includes comprehensive financial, affirmative, and negative covenants, with strict default and remedy provisions.

Voting matters and shareholder proposals

• Shareholder approval is required for the conversion of the term loan into equity and for the issuance of shares upon warrant exercise.

• A special meeting is scheduled for August 6, 2024, to vote on these proposals; failure to approve will trigger defaults and termination of the refinancing agreement.

Board of directors and corporate governance

• The agent has the right to appoint a board observer with access to board materials and meetings, subject to confidentiality and conflict-of-interest exclusions.

• Any material changes to charter documents or board structure require lender notification and, in some cases, consent.