United States securities and exchange commission logo
February 25, 2021
Lee Einbinder
Chief Executive Officer
FinServ Acquisition Corp.
1345 Avenue of the Americas
New York, NY 10105
Re: FinServ Acquisition
Corp.
Registration
Statement on Form S-4
Filed January 29,
2021
File No. 333-252558
Dear Mr. Einbinder:
We have reviewed your registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so
we may better
understand your disclosure.
Please respond to this letter by amending your registration
statement and providing the
requested information. If you do not believe our comments apply to your
facts and
circumstances or do not believe an amendment is appropriate, please tell
us why in your
response.
After reviewing any amendment to your registration statement and
the information you
provide in response to these comments, we may have additional comments.
Form S-4 filed on January 29, 2021
Q: What will happen to FinServ's securities upon consummation of the
business combination,
page iv
1. Please revise this
section to clarify, if true, that each outstanding share of FinServ
common stock and each
FinServ warrant will convert into one share of common stock and
one warrant,
respectively, of Katapult upon consummation of the business combination.
Summary
Merger Consideration, page 1
2. Here, and in the Merger
Consideration section, please provide a chart that indicates
exactly what the merger
consideration would have been for each share of Katapult
preferred and common
stock as of the date immediately prior to the execution of the
Lee Einbinder
FirstName LastNameLee
FinServ Acquisition Corp.Einbinder
Comapany25,
February NameFinServ
2021 Acquisition Corp.
February
Page 2 25, 2021 Page 2
FirstName LastName
Merger Agreement and as of the most recent practicable date prior to
effectiveness.
Risk Factors
Our ability to protect our confidential, proprietary, or sensitive
information..., page 26
3. Please revise to quantify, if material, any expenses you have incurred
in recent periods
relating to cyber-attacks, employee or other internal misconduct,
computer viruses,
physical or electronic break-ins, or similar disruptions.
Katapult's Solution, page 87
4. Please revise this section to discuss the total costs paid by a
consumer that utilizes
Katapult in order to lease-to-own durable goods. As appropriate,
please also provide
illustrative examples or a chart disclosing the total costs paid by
different consumers,
including any fees and varying interest rates depending upon the
amount financed or any
credit evaluation you perform on borrowers.
Lease to Own Product Overview, page 88
5. Please revise this section in order to describe what "Lease Multiple"
is and what it means
for it to be "-2.0x cash price"
Katapult's Management's Discussion and Analysis of Financial Condition and
Results of
Operations
Key Performance Metrics
Originations, page 101
6. We note you define originations as the acquisition value of the
durable goods associated
with lease-purchase agreements entered into during the period. This
does not appear
consistent with the definition provided on page 126, where
originations are defined as
dollar amount of leases originated. Please revise for consistency and
clarity.
Additionally, please provide us an example of an origination so that
we can better
understand how originations are determined.
Results of Operations, page 102
7. While you discuss certain factors to which changes in various line
items are attributable,
you do not quantify a large number of these factors nor analyze the
underlying business
reasons for the changes. We believe your disclosures could be improved
and clarified by
ensuring that all material factors are quantified and analyzed. In
addition, please quantify
the effects of changes in both price and volume on revenues
categories, where appropriate
(for example, describe the drivers of revenue in product categories
that experienced
significant change).
Lee Einbinder
FirstName LastNameLee
FinServ Acquisition Corp.Einbinder
Comapany25,
February NameFinServ
2021 Acquisition Corp.
February
Page 3 25, 2021 Page 3
FirstName LastName
Liquidity and Capital Resources, page 109
8. Please revise to identify any known trends or any known demands,
commitments, events
or uncertainties that will result in or that are reasonably likely to
result in your liquidity
increasing or decreasing in any material way. In addition, please
describe any known
material trends, favorable or unfavorable, in your capital resources
and indicate any
expected material changes in the mix and relative cost of such
resources.
Financing Agreements, page 110
9. Please identify the lender with which you have a line of credit
agreement. In addition,
please file your agreement(s) with this lender pursuant to Item
601(b)(10) of Regulation
S-K or advise us regarding the basis for your determination the
agreement(s) are not
required to be filed.
Statement of Operations, page F-37
10. Please revise to separately present revenue from services and product
sales (i.e., rental
revenue and merchandise sales). Refer to Rule 5-03(b)1 of Regulation
S-X.
Katapult Holdings, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
Note 2. Summary of Significant Accounting Policies
Accounts Receivable and Allowance for Doubtful Accounts, page F-42
11. You disclose that bad debt expense is classified in cost of revenue
within the consolidated
statements of operations and comprehensive loss. We note that this
presentation is not
consistent with certain competitors in your industry that classify bad
debt expense in
revenue and that your actual statement of operations presentation
includes bad debt
expense within operating expenses. Please revise as appropriate. Refer
to ASC 842-30-
25-13.
Please also tell us whether, at the lease commencement date, your
assessment is that lease
payments are probable of collection.
3. Property Held for Lease, Net, page F-49
12. We note property held for lease consists of furniture, consumer
electronics, appliances,
and other durable goods offered for lease-purchase in the normal
course of business.
Please disclose balances and accumulated depreciation of major classes
of property held
for lease at each balance sheet date or tell us why you believe such
disclosure is not
required. Refer to ASC 842-30-50-13 and ASC 360-10-50-1.
13. Please quantify for us the amount of property held for lease that was
not on lease at the
balance sheet dates.
We remind you that the company and its management are responsible for
the accuracy
Lee Einbinder
FinServ Acquisition Corp.
February 25, 2021
Page 4
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Refer to Rules 460 and 461 regarding requests for acceleration. Please
allow adequate
time for us to review any amendment prior to the requested effective date of
the registration
statement.
You may contact Blaise Rhodes at (202) 551-3774 or Lyn Shenk at (202)
551-3380 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Eric Envall at (202) 551-3234 or David Lin at (202) 551-3552 with any
other questions.
FirstName LastNameLee Einbinder Sincerely,
Comapany NameFinServ Acquisition Corp.
Division of
Corporation Finance
February 25, 2021 Page 4 Office of Trade &
Services
FirstName LastName