Funko (NASDAQ: FNKO) extends debt to 2027, tightens covenants and pricing

Rhea-AI Filing Summary

Funko, Inc. disclosed that its subsidiary Funko Acquisition Holdings, L.L.C. and key domestic subsidiaries entered into a Fifth Amendment to their existing credit agreement with JPMorgan Chase Bank and other lenders. The amendment extends the loan maturity date from September 17, 2026 to December 31, 2027.

The lenders waive certain minimum fixed charge coverage and maximum net leverage covenants for multiple quarters in 2025 and 2026, add a minimum EBITDA covenant for the six‑month period ending June 30, 2026, and allow skipping some covenant tests if at least $10 million of voluntary prepayments are made for the relevant period. The amendment removes a 10 basis point SOFR credit spread adjustment but increases the loan margin to 450 basis points initially, with further increases outlined in the amended agreement.

The changes also modify amortization of term loans, introduce amortization and mandatory quarterly prepayments of revolving loans with cash and cash equivalents above $50 million, adjust financial reporting and affirmative covenants, and add new events of default, tightening ongoing lender protections while providing more time and flexibility on near‑term covenant pressure.

Positive

• Extended debt maturity and covenant waivers reduce near‑term default risk. The amendment pushes loan maturity from September 17, 2026 to December 31, 2027 and waives key fixed charge coverage and net leverage covenants for several 2025–2026 quarters, easing immediate refinancing and covenant pressure.

Negative

• Higher pricing and tighter cash sweeps raise financing burden. The applicable margin increases to 450 basis points with further step‑ups, amortization is tightened on term and revolving loans, and quarterly mandatory prepayments are required from cash and cash equivalents above $50 million, pressuring liquidity.

Insights

Credit & Capital Structure Analyst

Funko trades higher pricing and tighter terms for extra time and covenant relief.

The amendment extends Funko’s loan maturity to December 31, 2027, avoiding a near‑term refinancing wall. Waivers and easing of fixed charge coverage and net leverage covenants across several quarters reduce the risk of technical default while performance recovers.

In exchange, lenders secure a higher applicable margin of 450% basis points initially, removal of the SOFR credit spread adjustment, stricter amortization on term and revolving loans, and mandatory quarterly prepayments from cash and cash equivalents above $50 million. These features increase debt service demands and limit excess liquidity.

Overall, the amendment restructures the risk profile rather than resolving leverage; outcomes will depend on Funko’s ability to meet the new minimum EBITDA covenant for the six‑month period ending June 30, 2026 and to manage cash generation against higher interest costs and required prepayments.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

February 13, 2026

Date of Report (Date of earliest event reported) 

 FUNKO, INC.

(Exact Name of Registrant as Specified in its Charter)

 

Delaware

001-38274

35-2593276

(State or Other Jurisdiction of Incorporation)

(Commission File Number)

(IRS Employer Identification No.)

2802 Wetmore Avenue

Everett, Washington 98201

(Address of Principal Executive Offices) (Zip Code)

(425) 783-3616

(Registrant’s telephone number, including area code)

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Class A Common Stock, $0.0001 par value per share			FNKO			The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Item 1.01. Entry into a Material Definitive Agreement.

On February 13, 2026, Funko Acquisition Holdings, L.L.C. (the “Company”), a subsidiary of Funko, Inc., and certain of the Company’s material domestic subsidiaries (collectively, the “Credit Agreement Parties”) entered into an amendment (the “Fifth Amendment”) with the lenders party to the Existing Credit Agreement (as defined below) and JPMorgan Chase Bank, N.A. as administrative agent (“JPM”).

The Fifth Amendment amends the Credit Agreement, dated as of September 17, 2021 (as previously amended, restated, amended and restated, supplemented, waived or otherwise modified from time to time including on April 26, 2022, July 29, 2022, February 28, 2023 and July 16, 2025, the “Existing Credit Agreement” and, the Existing Credit Agreement as amended by the Fifth Amendment, the “Amended Credit Agreement”), among the Credit Agreement Parties, certain financial institutions party thereto and JPM.

The Fifth Amendment, among other things, amends the Existing Credit Agreement to (i) extend the maturity date of the loans from September 17, 2026 to December 31, 2027, (ii) amend the financial covenants applicable to the Company and its subsidiaries to, among other things, (a) waive the minimum fixed charge coverage ratio financial covenant for the fiscal quarter ended December 31, 2025 and the fiscal quarters ending March 31, 2026 and June 30, 2026, (b) provide the Company additional cushion with respect to the minimum fixed charge coverage ratio financial covenant for the fiscal quarters ending September 30, 2026, December 31, 2026 and March 31, 2027 relative to the minimum fixed charge coverage ratio covenant set forth in the Existing Credit Agreement, (c) introduce a minimum EBITDA covenant for the six-month period ending June 30, 2026, (d) waive the maximum net leverage ratio covenant for the fiscal quarter ended December 31, 2025 and the fiscal quarters ending March 31, 2026, June 30, 2026 and September 30, 2026 and (e) subject to certain usage restrictions, permit the Company to forego testing of certain financial covenants for any test period (to the extent required to be tested in such test period) if the Company makes a voluntary prepayment of the loans in an amount not less than $10 million prior to the delivery of a compliance certificate for such test period; and (iii) remove the 10 basis points credit spread adjustment applicable to SOFR loans.

The Fifth Amendment also includes certain other modifications, including (i) increasing the applicable margin on all outstanding loans to 450 basis points effective on the closing date of the Fifth Amendment, with subsequent increases to the applicable margin as set forth in the Amended Credit Agreement; (ii) modifying the amortization payment on the term loans and requiring amortization payments on the outstanding revolving loans, with each such amortization payment in respect of the outstanding revolving loans permanently reducing the revolving commitments; (iii) requiring quarterly mandatory prepayment of the revolving loans with cash (subject to certain exceptions) and cash equivalents in excess of $50 million, with each such prepayment permanently reducing the revolving commitments; (iv) modifying certain financial reporting obligations of the Company and adding certain new affirmative covenants applicable to the Company and its subsidiaries; and (v) adding certain additional events of default.

The description of the Fifth Amendment contained herein does not purport to be complete, and is subject to and qualified in its entirety by reference to the full text of the Fifth Amendment which is attached as Exhibit 10.1 to this Current Report on Form 8-K, and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d)    Exhibits:

Exhibit No.						Description
10.1+						Amendment No. 5, dated as of February 13, 2026, by and among Funko Acquisition Holdings, L.L.C., the subsidiary borrowers party thereto, the consenting lenders party thereto and JPMorgan Chase Bank, N.A. as administrative agent.
104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

 + The annexes, schedules, and certain exhibits to this Exhibit have been omitted pursuant to Item 601(a)(5)(b)(2) of Regulation S-K. The Registrant hereby agrees to furnish supplementally a copy of any omitted annex, schedule or exhibit to the SEC upon request.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: February 13, 2026 FUNKO, INC.

			By:			/s/ Tracy D. Daw
						Tracy D. Daw
						Chief Legal Officer and Secretary

FAQ

What did Funko Inc. (FNKO) announce regarding its credit agreement?

Funko’s subsidiary entered a Fifth Amendment to its existing credit agreement. The amendment extends loan maturity, adjusts financial covenants, increases interest margins, introduces new amortization and mandatory prepayments, and adds reporting requirements and events of default, reshaping the company’s debt terms and covenant framework.

How does the Fifth Amendment change Funko (FNKO) loan maturity and pricing?

The amendment extends the loans’ maturity date from September 17, 2026 to December 31, 2027. In return, the applicable margin on all outstanding loans rises to 450 basis points at closing, with further increases specified later, while a 10 basis point SOFR credit spread adjustment is removed.

What covenant relief does Funko (FNKO) receive under the amended credit agreement?

Lenders waive the minimum fixed charge coverage ratio and maximum net leverage ratio for several quarters in 2025 and 2026. The amendment also allows Funko to skip certain financial covenant tests for a period if it makes at least $10 million of voluntary loan prepayments before submitting the related compliance certificate.

What new financial covenants are added for Funko (FNKO) in this amendment?

The amendment introduces a minimum EBITDA covenant for the six‑month period ending June 30, 2026. It also adjusts fixed charge coverage requirements for later quarters, adds new affirmative covenants, modifies financial reporting obligations, and includes additional events of default, increasing ongoing performance and disclosure expectations.

How does the amended agreement affect Funko (FNKO) revolving loans and cash usage?

Amortization payments are required on outstanding revolving loans, and each payment permanently reduces revolving commitments. The company must also make quarterly mandatory prepayments of revolving loans from cash and cash equivalents exceeding $50 million, subject to exceptions, tightening how excess liquidity can be retained.

Who are the key parties to Funko (FNKO) Fifth Amendment to the credit agreement?

The key parties are Funko Acquisition Holdings, L.L.C., its material domestic subsidiaries as borrowers or guarantors, the lenders under the existing credit agreement, and JPMorgan Chase Bank, N.A. acting as administrative agent, all joining to modify and restate the prior credit terms through the Fifth Amendment.

Filing Exhibits & Attachments

4 documents

Agreements & Contracts

• EX-10.1 EX-10.1 1.4 MB

Other Documents

• EX-101 XBRL TAXONOMY EXTENSION SCHEMA DOCUMENT 1.7 KB
• EX-101 XBRL TAXONOMY EXTENSION LABEL LINKBASE DOCUMENT 21.1 KB
• EX-101 XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE DOCUMENT 12.2 KB