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Item 1.01
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Entry into a Material Definitive Agreement.
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As described in greater detail below, on November 3, 2025, Katapult Holdings, Inc., a Delaware corporation (the "Company"), entered into the following agreements and closed the transactions contemplated thereunder:
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Series A Investment Agreement (as defined below) pursuant to which the Company issued and sold to HHCF Series 21 Sub, LLC, a Delaware limited liability company and subsidiary of Hawthorn Horizon Credit Fund, LLC (the "Purchaser"), an aggregate of 35,000 shares of a newly created series of the Company's preferred stock, par value $0.0001 per share, designated as "Series A Convertible Preferred Stock" (the "Series A Convertible Preferred Stock") at a purchase price of $1,000 per share, resulting in total gross proceeds to the Company of $35.0 million (the "Series A Issuance") and has used the net proceeds from the Series A Issuance to repay in full the Company's term loan and for certain other agreed purposes. The initial conversion price of the Series A Convertible Preferred Stock is $12.32 and if the Purchaser were to convert all of its shares of Series A Convertible Preferred Stock to Company's common stock, par value $0.0001 per share (the "Common Stock"), the Purchaser would beneficially own an aggregate of 2,840,910 shares of Common Stock representing approximately 28.3% of the issued and outstanding Common Stock, subject to the Ownership Limitation (as defined below).
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Series B Investment Agreement (as defined below) pursuant to which the Company has issued and sold to the Purchaser an aggregate of 30,000 shares of a newly created series of the Company's preferred stock, par value $0.0001 per share, designated as "Series B Convertible Preferred Stock" (the "Series B Convertible Preferred Stock" and together with the Series A Convertible Preferred Stock, the "Preferred Stock") at a purchase price of $1,000 per share, resulting in total gross proceeds to the Company of $30.0 million (the "Series B Issuance", and together with the Series A Issuance, the "Preferred Stock Issuances") and has used or agreed to use the net proceeds from the Series B Issuance to partially prepay the Company's revolving loan, pay transaction expenses and for general corporate purposes subject to the prior approval of the Company's Board of Directors (the "Board"). The initial conversion price of the Series B Convertible Preferred Stock is $11.39 and if the Purchaser were to convert all of its shares of Series B Convertible Preferred Stock to Common Stock, the Purchaser would beneficially own an aggregate of 2,633,890 shares of Common Stock representing 26.2% of the issued and outstanding Common Stock, subject to the Ownership Limitation. If the Purchaser were to convert all of its shares of Series A Convertible Preferred Stock and Series B Convertible Preferred Stock to Common Stock, the Purchaser would beneficially own an aggregate of 5,474,800 shares of Common Stock representing 54.5% of the issued and outstanding Common Stock, subject to the Ownership Limitation.
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Registration Rights Agreements (as defined below) pursuant to which the Company granted to the Purchaser certain customary demand, "piggy-back" and shelf registration rights with respect to shares of Common Stock to be received by the Purchaser upon conversion of its Preferred Stock, subject to certain customary thresholds and conditions. Under the terms of the Registration Rights Agreements, the Company has agreed to file a registration statement covering the resale of the shares of Common Stock issuable upon conversion of the Preferred Stock within 45 days following the closing of the Preferred Stock Issuances.
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