L.O.T.W. #125 - Katapult Holdings - upsizes revolving line to support continued lease to own (LTO) business growth
ABL revolver and convertible term loan provided by certain entities affiliated with Blue Owl Capital Inc.
Katapult refinanced its existing credit facility by entering into an Amended and Restated Loan and Security Agreement, which includes a $110 million upsized revolving credit facility and a $32.7 million term loan, both continuing from prior agreements. The new revolving facility features $20 million in incremental commitments and offers increasing advance rates tied to stockholder approval milestones, while the term loan carries an 18% PIK interest rate and may convert to equity upon meeting certain conditions.
👓At a Glance
Borrower: Katapult SPV-1 LLC
Lender: Midtown Madison Management LLC (Agent)
Deal Size: $110.0 million
Structure: Collateralized revolving line of credit
Rate: Variable - SOFR subject to 3.00% floor and credit adjustment spread of 0.10% plus 7.00%
Term: ~17 months
Use of Proceeds: Finance the acquisition of property held for lease
Source: SEC 8-K
📷Borrower Snapshot
Sector: Financials
Subsector: Consumer Finance
Ownership: Public
Commercial Stage: Commercial Revenue; Adj. EBITDA +
Business Overview: Katapult is an e‑commerce fintech firm specializing in lease‑to‑own (LTO) financing for non‑prime U.S. consumers. Its fully digital platform integrates with online and in‑store retailers, offering flexible lease-purchase plans via POS, mobile/web app, and virtual credit cards (Katapult Pay/KPay).
⚙️Structure & Terms
Source: SEC 8-K
Commitment: $110.0 million
Maturity: September 1, 2025 or December 4, 2026 if requisite shareholder approval is obtained prior to September 1, 2025
Rate: Variable - SOFR subject to 3.00% floor and credit adjustment spread of 0.10% plus 7.00%
Advance Rate: Variable and ranging between 91% - 99% based on pre-defined advance rate triggers (charge-off percentage ratio; cumulative cash collection percentage ratio; first payment default ratio)
Administration Fee: $12.5k at closing; $12.5k quarterly
Covenants:
Minimum trailing three-month net originations
based on grid but starting at $61.0 million and increasing to $80.0 million by November 2026
Minimum liquidity measured weekly beginning in February 2026
Beginning at $1.0 million and increasing to $5.0 million
Term advance rate
135% from closing to August 31, 2025, increasing to 140% until full completion of term loan conversion