Direct Digital converts $25M term loans to Series A Preferred; debt reduced to $9.4M

Direct Digital Holdings, Inc.

$25M of term loans exchanged for Series A Preferred stock issued to Lafayette Square; remaining term loan debt $9.36M.
Series A Preferred carries 10% cumulative dividend, convertible at $2.50/share, and liquidation preference up to 3x after Oct 15, 2025.
Credit parties must maintain minimum EBITDA of $1M for Q3/Q4 2025 and $500M thereafter; cash covenant set at $1.5M.
A $25M exit fee on preferred redemption is waived if fully redeemed by Dec 31, 2026; $1M closing fee due by Sept 30, 2025.
Preferred stock is senior to common, voting on as-converted basis, with protective provisions requiring majority holder consent for key actions.

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