Commvault (NASDAQ: CVLT) issues $900M 0% convertible notes due 2030
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Commvault Systems, Inc. entered into an Indenture and issued $900,000,000 aggregate principal amount of 0% Convertible Senior Notes due 2030, including the full exercise of the initial purchasers’ $115,000,000 option. The Notes are senior unsecured obligations, mature on September 15, 2030, bear no regular interest, and may accrue up to 0.50% in special and additional interest upon certain events.
The Notes are initially convertible at 4.2215 shares per $1,000 (conversion price about $236.88 per share), with conditional early conversion features and issuer redemption rights starting in 2028 if stock price and other conditions are met. Commvault also entered into capped call transactions covering the shares underlying the Notes, with an initial cap price of $357.56 per share, designed to reduce potential dilution or excess cash payments upon conversion, subject to a cap.
Positive
- None.
Negative
- None.
Insights
Commvault adds $900M in 0% convertible debt with capped call hedge.
Commvault Systems, Inc. has issued $900,000,000 of 0% Convertible Senior Notes due 2030, sold via a Rule 144A private offering with the full $115,000,000 option exercised. The Notes are senior unsecured and sit alongside other senior unsecured borrowings, while being effectively subordinated to secured debt and structurally subordinated to subsidiary liabilities.
The initial conversion rate of 4.2215 shares per $1,000 (about $236.88 per share) and a maximum adjusted rate of 5.5934 shares per $1,000 imply potential equity issuance of up to 5,034,060 shares if fully converted. Early conversion and issuer redemption are tied to stock-price tests and Fundamental Change definitions, which govern when holders can seek cash repurchase or enhanced conversion terms.
To manage equity impact, the company entered capped call transactions with a cap price of $357.56 per share, double the $178.78 last reported sale price on September 2, 2025. These instruments are designed to reduce dilution or incremental cash owed above principal upon conversion, within the cap, while remaining separate from noteholder rights.
8-K Event Classification
5 items: 1.01, 2.03, 3.02, 8.01, 9.01
5 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.03
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
Financial
The company incurred a new significant debt or off-balance-sheet obligation.
Item 3.02
Unregistered Sales of Equity Securities
Securities
The company sold equity securities in a private placement or other unregistered transaction.
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
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
Date of Report (Date of earliest event reported) September 2, 2025
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
(Address of principal executive offices) (Zip Code)
(732 ) 870-4000
(Registrant's telephone number, including area code)
Not Applicable
(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):
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
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
Indenture and Notes
On September 5, 2025, Commvault Systems, Inc. (the “Company”) issued $900,000,000 aggregate principal amount of 0% Convertible Senior Notes due 2030 (the “Notes”). The Notes were issued pursuant to an Indenture, dated September 5, 2025 (the “Indenture”), between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”). Pursuant to the purchase agreement between the Company and the representatives of the initial purchasers of the Notes, the Company granted the initial purchasers an option to purchase, for settlement within a period of 11 days from, and including, the date the Notes are first issued, up to an additional $115,000,000 aggregate principal amount of Notes. On September 3, 2025, the initial purchasers exercised this option in full and the Notes issued on September 5, 2025 include the additional $115,000,000 aggregate principal amount of Notes.
The Company offered and sold the Notes to the initial purchasers in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and for resale by the initial purchasers to persons reasonably believed to be qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A under the Securities Act.
The Notes are the Company’s senior, unsecured obligations and rank equally in right of payment with the Company’s existing and future senior, unsecured indebtedness, rank senior in right of payment to the Company’s existing and future indebtedness that is expressly subordinated to the Notes in right of payment, effectively subordinated to the Company’s existing and future secured indebtedness to the extent of the value of the collateral securing such indebtedness, including the Company’s revolving credit facility, and structurally subordinated to all indebtedness and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof) preferred equity, if any, of the Company’s subsidiaries.
The Notes will mature on September 15, 2030, unless earlier converted, redeemed or repurchased. The Notes will not bear regular interest, and the principal amount of the Notes will not accrete. However, special interest and additional interest, if any, may accrue on the Notes at a combined rate per annum not exceeding 0.50% upon the occurrence of certain events as described in the Indenture.
On or after March 15, 2030, until the close of business on the second Scheduled Trading Day (as defined in the Indenture) immediately before the maturity date, the Notes will be convertible at the option of the noteholders at any time.
Before March 15, 2030, noteholders will have the right to convert their Notes only under the following circumstances:
(1)during any fiscal quarter (and only during such fiscal quarter) commencing after the fiscal quarter ending on December 31, 2025, if the Last Reported Sale Price (as defined in the Indenture) per share of the Company’s common stock, par value $0.01 per share (the “Common Stock”), exceeds 130% of the conversion price (as described below) for each of at least 20 Trading Days (as defined in the Indenture) (whether or not consecutive) during a period of 30 consecutive Trading Days ending on, and including, the last Trading Day of the immediately preceding fiscal quarter;
(2)during the five consecutive business days immediately after any ten consecutive Trading Day period (the “Measurement Period”) in which the Trading Price (as defined in the Indenture) per $1,000 principal amount of Notes for each Trading Day of the Measurement Period was less than 98% of the product of the Last Reported Sale Price per share of the Common Stock on such Trading Day and the conversion rate (as described below) on each Trading Day;
2
(3)upon the occurrence of specified corporate events or distributions on the Common Stock as set forth in the Indenture; or
(4)if the Company calls such Notes for redemption.
The conversion rate for the Notes will initially be 4.2215 shares of Common Stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $236.88 per share of Common Stock. The conversion rate is subject to adjustment upon certain events. Upon conversion, the Company will settle conversions by paying cash up to the aggregate principal amount of the Notes to be converted and paying or delivering, as the case may be, cash, shares of Common Stock or a combination of cash and shares of Common Stock, at its election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the Notes being converted, based on the applicable conversion rate(s).
The Company may not redeem the Notes at its option at any time before September 22, 2028. The Company will have the option to redeem the Notes, in whole or in part (subject to the partial redemption limitation described below), at any time, and from time to time, on or after September 22, 2028 and before the 41st Scheduled Trading Day immediately before the maturity date, at a cash redemption price equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid special interest and additional interest, if any, to, but excluding, the redemption date, but only if (i) the Notes are Freely Tradable (as defined in the Indenture) as of the date the Company sends the related redemption notice and all accrued and unpaid additional interest, if any, has been paid in full as of the first Special and Additional Interest Payment Date (as defined in the Indenture) occurring on or before the date the Company sends such notice; and (ii) the Last Reported Sale Price per share of the Common Stock exceeds 130% of the conversion price on (1) each of at least 20 Trading Days, whether or not consecutive, during the 30 consecutive Trading Days ending on, and including, the Trading Day immediately before the date the Company sends the related redemption notice; and (2) the Trading Day immediately before the date the Company sends such notice. In addition, calling any Note for redemption will constitute a Make-Whole Fundamental Change (as defined in the Indenture) with respect to that Note, in which case the conversion rate applicable to the conversion of that Note will be increased in certain circumstances if it is converted after it is called for redemption. Pursuant to the partial redemption limitation, the Company may not elect to redeem less than all of the outstanding Notes unless at least $100.0 million aggregate principal amount of Notes are outstanding and not subject to redemption as of the time it sends the related redemption notice.
If certain corporate events that constitute a Fundamental Change (as defined in the Indenture) occur, then, subject to certain exceptions, noteholders may require the Company to repurchase their Notes in whole or in part for cash at a price equal to the principal amount of the Notes to be repurchased, plus accrued and unpaid special interest and additional interest, if any, to, but excluding, the Fundamental Change Repurchase Date (as defined in the Indenture). The definition of Fundamental Change includes, among other things, certain business combination transactions involving the Company and certain de-listing events with respect to the Common Stock.
In addition, upon a Make-Whole Fundamental Change, the Company will, under certain circumstances, increase the applicable conversion rate for a holder that elects to convert its Notes in connection with such Make-Whole Fundamental Change. No adjustment to the conversion rate will be made if the Stock Price (as defined in the Indenture) in such Make-Whole Fundamental Change is either less than $178.78 per share or greater than $1,100.00 per share. The Company will not increase the conversion rate to an amount that exceeds 5.5934 shares per $1,000 principal amount of Notes, subject to adjustment as set forth in the Indenture.
The Notes will have customary provisions relating to the occurrence of Events of Default (as defined in the Indenture), which include the following:
(i)certain payment defaults (which, in the case of a default in the payment of special interest or additional interest on the Notes, will be subject to a 30-day cure period);
3
(ii)the Company’s failure to send certain notices under the Indenture within specified periods of time, subject to applicable cure periods;
(iii)a default by the Company in its obligation to convert a Note in accordance with the Indenture if not cured within three business days after its occurrence;
(iv)the Company’s failure to comply with certain covenants in the Indenture relating to the Company’s ability to consolidate with or merge with or into, or sell, lease or otherwise transfer, in one transaction or a series of transactions, all or substantially all of the assets of the Company and its subsidiaries, taken as a whole, to another person;
(v)a default by the Company in its other obligations or agreements under the Indenture or the Notes if such default is not cured or waived within 60 days after notice is given in accordance with the Indenture;
(vi)certain defaults by the Company or any of its Significant Subsidiaries (as defined in the Indenture) with respect to indebtedness for borrowed money of at least $100 million; and
(vii)certain events of bankruptcy, insolvency and reorganization involving the Company or any of its Significant Subsidiaries.
If an Event of Default involving bankruptcy, insolvency or reorganization events with respect to the Company (and not solely with respect to a Significant Subsidiary), occurs, then the principal amount of, and all accrued and unpaid interest, if any, on, all of the then outstanding Notes will immediately become due and payable without any further action or notice by any person. If an of Event of Default (other than an Event of Default described in the immediately preceding sentence) occurs and is continuing, then, except as described in the immediately succeeding sentence, the Trustee, by notice to the Company, or the noteholders of at least 25% of the aggregate principal amount of the then outstanding Notes by notice to the Company and the Trustee, may declare the principal amount of, and all accrued and unpaid interest, if any, on, all of the then outstanding Notes to become due and payable immediately. Notwithstanding the foregoing the Company may elect, at its option, that the sole remedy for an Event of Default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture will, for the first 365 days on which such an Event of Default has occurred and is continuing, consist exclusively of the right of noteholders to receive special interest on the Notes at a specified rate per annum not exceeding 0.50% on the principal amount of the Notes.
In certain circumstances if, at any time during the six-month period beginning on, and including, the date that is six months after the last date of original issuance of the Notes, the Company fails to timely file certain reports required to be filed with the SEC under the U.S. Securities Exchange Act of 1934, as amended, or the Notes are not otherwise Freely Tradable by holders of the Notes other than the Company’s affiliates, additional interest will accrue on the Notes during the period in which the Company’s failure to file has occurred and is continuing or such Notes are not otherwise Freely Tradable by holders other than the Company’s affiliates.
In addition, if, and for so long as, the restrictive legend on the Notes has not been removed in accordance with the terms of the Indenture and the Notes, the Notes are assigned a restricted CUSIP number or the Notes are not otherwise Freely Tradable by holders other than the Company’s affiliates (without restrictions pursuant to U.S. securities laws or the terms of the Indenture or the Notes) as of the 15th day after the one-year anniversary of the last date of original issuance of the Notes, then additional interest will accrue on the Notes with respect to the period in which the Notes remain so restricted at a specified rate per annum not exceeding 0.50% on the principal amount of the Notes.
The above description of the Indenture and the Notes is a summary and is not complete. A copy of the Indenture and Form of Global Note are filed as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K, and are incorporated herein by reference. This description is qualified in its entirety by reference to such documents.
Capped Call Transactions
4
On September 2, 2025 and September 3, 2025, in connection with the pricing of the Notes and the exercise by the initial purchasers of their option in full to purchase additional Notes, respectively, the Company entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with an affiliate of one of the initial purchasers and certain other financial institutions (the “Option Counterparties”).
The Capped Call Transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Notes, the number of shares of Common Stock initially underlying the Notes. The Capped Call Transactions are expected generally to reduce the potential dilution to the Common Stock upon any conversion of the Notes and/or offset any potential cash payments the Company is required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap. The cap price of the Capped Call Transactions will initially be $357.56 per share of Common Stock, which represents a premium of 100% over the last reported sale price of the Common Stock of $178.78 per share on September 2, 2025, and is subject to certain adjustments under the terms of the Capped Call Transactions.
The Capped Call Transactions are separate transactions (in each case entered into by the Company with the Option Counterparties), are not part of the terms of the Notes and will not change the holders’ rights under the Notes. Holders will not have any rights with respect to the Capped Call Transactions.
The above description of the Capped Call Transactions is a summary and is not complete. A copy of the Form of Capped Call Confirmation is filed as Exhibit 10.1 to this Current Report on Form 8-K, and the above summary is qualified by reference to the full text of the Form of Capped Call Confirmation set forth in such exhibit.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
Item 3.02 Unregistered Sales of Equity Securities
The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
The Notes were issued to the initial purchasers in reliance upon Section 4(a)(2) of the Securities Act, in transactions not involving any public offering. The Notes were resold by the initial purchasers to persons whom the initial purchasers reasonably believe are “qualified institutional buyers” as defined in, and in accordance with, Rule 144A under the Securities Act. Any shares of Common Stock that may be issued upon conversion of the Notes will be issued in reliance upon Section 3(a)(9) of the Securities Act as involving an exchange by the Company exclusively with its security holders. Initially, a maximum of 5,034,060 shares of Common Stock may be issued upon conversion of the Notes, based on the initial maximum conversion rate of 5.5934 shares of Common Stock per $1,000 principal amount of Notes, which is subject to customary anti-dilution adjustment provisions. Additional information pertaining to the Notes and the shares of Common Stock issuable upon conversion of the Notes is contained in Item 1.01 of this report and is incorporated herein by reference.
This Current Report on Form 8-K is neither an offer to sell, nor a solicitation of an offer to buy, any security and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Item 8.01 Other Events
5
On September 2, 2025, the Company issued a press release announcing the pricing of the Notes. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.
Neither this Current Report on Form 8-K nor the press release attached hereto as Exhibit 99.1 constitutes an offer to sell, or the solicitation of an offer to buy, the Notes or the shares of Common Stock, if any, issuable upon conversion of the Notes.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits:
| Exhibit No. | Description | ||||
4.1 | Indenture, dated September 5, 2025, between Commvault Systems, Inc. and the Trustee. | ||||
4.2 | Form of Global Note representing Commvault Systems, Inc.’s 0% Convertible Senior Notes due 2030 (included within Exhibit 4.1). | ||||
10.1 | Form of Capped Call Confirmation. | ||||
99.1 | Pricing Press Release dated September 2, 2025. | ||||
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in the Inline XBRL document). | ||||
6
SIGNATURES
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.
COMMVAULT SYSTEMS, INC.
| Dated: | September 5, 2025 | /s/ Jen DiRico | ||||||
| Name: Jen DiRico Title: Chief Financial Officer | ||||||||
7
FAQ
What did Commvault Systems (CVLT) announce regarding new financing?
Commvault Systems, Inc. issued $900,000,000 aggregate principal amount of 0% Convertible Senior Notes due 2030 in a Rule 144A private offering, including the full exercise of the initial purchasers’ $115,000,000 option.
What are the key terms of Commvault’s 0% Convertible Senior Notes due 2030?
The Notes are senior unsecured, mature on September 15, 2030, bear no regular interest, and may accrue special and additional interest at a combined rate not exceeding 0.50% upon certain events, with various conversion, redemption, and Fundamental Change repurchase features.
At what price can Commvault’s new convertible notes initially convert into common stock?
The Notes have an initial conversion rate of 4.2215 shares per $1,000 principal amount, equivalent to an initial conversion price of approximately $236.88 per share of Commvault common stock, subject to adjustment.
What are the capped call transactions Commvault entered into and why are they important?
Commvault entered into capped call transactions with financial institutions covering the shares underlying the Notes. With an initial cap price of $357.56 per share (a 100% premium to the $178.78 last reported sale price on September 2, 2025), these transactions are expected to reduce potential dilution or offset cash payments above principal upon conversion, up to the cap.
Under what conditions can Commvault redeem the convertible notes before maturity?
On or after September 22, 2028, and before the 41st Scheduled Trading Day before maturity, Commvault may redeem the Notes for cash at par plus accrued special and additional interest, if the Notes are freely tradable, any additional interest is current, and the stock price exceeds 130% of the conversion price for specified trading-day periods.