PROGRESS SOFTWARE CORP /MAPRGS
PROGRESS SOFTWARE CORP /MA Debt Disclosure
Debt
As of November 30, 2025 and 2024, we had the following debt obligations:
| (in thousands) | November 30, 2025 | November 30, 2024 | |||||||||
| Current portion of long-term debt: | |||||||||||
1.0% convertible senior notes due 2026 | $ | 360,000 | $ | — | |||||||
| Unamortized discount and issuance costs for the Notes | (837) | — | |||||||||
| Total current portion of long-term debt | 359,163 | — | |||||||||
| Long-term debt: | |||||||||||
1.0% convertible senior notes due 2026 | — | 360,000 | |||||||||
3.5% convertible senior notes due 2030 | 450,000 | 450,000 | |||||||||
Revolving credit facility(1) | 600,000 | 730,000 | |||||||||
| Total face value of long-term debt | 1,050,000 | 1,540,000 | |||||||||
| Unamortized discount and issuance costs for the Notes | (8,814) | (13,733) | |||||||||
| Total long-term debt | 1,041,186 | 1,526,267 | |||||||||
| Total debt | $ | 1,400,349 | $ | 1,526,267 | |||||||
(1) Unamortized debt issuance costs related to the revolving credit facility of $10.4 million and $6.0 million are included in other assets on the consolidated balance sheets as of November 30, 2025 and 2024, respectively.
Notes Payable
In March 2024, we issued, in a private placement, convertible senior notes with an aggregate principal amount of $450 million, due March 1, 2030, unless earlier repurchased, redeemed, or converted. In April 2021, we issued, in a private placement, convertible senior notes with an aggregate principal amount of $360.0 million, due April 15, 2026, unless earlier repurchased, redeemed, or converted. There are no required principal payments prior to the maturity of the Notes. During the fiscal year ending November 30, 2025, we reclassified the 2026 Notes from long-term debt to current liabilities.
Further details of the Notes are as follows:
| Issuance | Maturity Date | Interest Rate | Effective Interest Rate | Semi-Annual Interest Payment Dates | Initial Conversion Rate per $1,000 Principal | Initial Conversion Price per share of common stock | ||||||||||||||||||||||||||||||||
| 2030 Notes | March 1, 2030 | 3.50% | 4.00% | March 1 and September 1 | 14.7622 | $67.74 | ||||||||||||||||||||||||||||||||
| 2026 Notes | April 15, 2026 | 1.00% | 1.63% | April 15 and October 15 | 17.4525 | $57.30 | ||||||||||||||||||||||||||||||||
Conversion Rights
Before November 1, 2029 and January 15, 2026, Noteholders may convert their 2030 Notes and 2026 Notes, respectively, in the following circumstances:
•During any fiscal quarter commencing after the fiscal quarter ending on May 31, 2024 in the case of the 2030 Notes and May 31, 2021 in the case of the 2026 Notes, if the last reported sale price per share of the Company's common stock exceeds 130% of the conversion price for each of at least twenty trading days (whether or not consecutive) during the thirty consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter; or
•During the five consecutive business days immediately after any ten consecutive trading day period (the "Measurement Period"), if the trading price per $1,000 principal amount of the applicable 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 Company's common stock on such trading day and the conversion rate on such trading day; or
•Upon the occurrence of distributions on the Company's common stock, which distribution per share of common stock has a value exceeding 10% of the last reported sale price per share on the trading day immediately before the date such distribution is announced; or
•Upon the occurrence of certain corporate events or if the Company calls such applicable Notes for redemption, then the Noteholder of any applicable Note may convert such Note.
From and after November 1, 2029 and January 15, 2026, Noteholders may convert their 2030 Notes and 2026 Notes, respectively, at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date. The Company will satisfy its conversion obligations by paying cash up to the aggregate principal amount of the Notes to be converted, by issuing shares of its common stock or a combination of cash and shares of its common stock, at its election. The conversion rate will be adjusted upon the occurrence of certain events, including spin-offs, tender offers, exchange offers, make-whole fundamental change, and certain stockholder distributions.
Repurchase Rights
On or after March 5, 2027, and on or before the 60th scheduled trading day immediately before the maturity date, the Company may redeem for cash all or part of the 2030 Notes. On or after April 20, 2024, and on or before the 50th scheduled trading day immediately before the maturity date, the Company may redeem for cash all or part of the 2026 Notes. These redemptions are subject to the partial redemption limitation, at a repurchase price equal to the principal amount, plus accrued and unpaid interest, if the last reported sale price per share of the Company's common stock exceeded 130% of the conversion price on (1) each of at least twenty trading days (whether or not consecutive) during any thirty consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides a redemption notice and (2) the trading day immediately before the date the Company sends such notice. Pursuant to the partial redemption limitation, the Company may not elect to redeem less than all of the outstanding 2030 Notes or 2026 Notes unless at least $100.0 million aggregate principal amount of the 2030 Notes or 2026 Notes, respectively, 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 (e.g., events such as business combination transactions involving the Company, shareholder approval of liquidation or dissolution of the Company, and certain de-listing events with respect to the Company's common stock) occur at any time, holders may, subject to certain exceptions, require the Company to purchase 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 interest, to, but excluding, the fundamental change repurchase date.
Accounting for the Notes
The 2030 Notes are classified within non-current liabilities on our consolidated balance sheets. During fiscal year 2025, the 2026 Notes were reclassified from non-current liabilities to current liabilities on our consolidated balance sheets. The conversion option of the Notes does not require bifurcation as an embedded derivative. Issuance costs of $12.0 million and $10.8 million were recorded as a reduction to the principal balance of the 2030 Notes and 2026 Notes, respectively, and will be amortized as interest expense using the effective interest method over the contractual term.
| Fiscal Year Ended | ||||||||||||||||||||||||||||||||
| November 30, 2025 | November 30, 2024 | November 30, 2023 | ||||||||||||||||||||||||||||||
| (in thousands) | 2030 Notes | 2026 Notes | 2030 Notes | 2026 Notes | 2026 Notes | |||||||||||||||||||||||||||
| Contractual interest expense | $ | 15,750 | $ | 3,600 | $ | 11,813 | $ | 3,610 | $ | 3,600 | ||||||||||||||||||||||
| Amortization of debt discount and issuance costs | 1,865 | 2,216 | 1,351 | 2,174 | 2,147 | |||||||||||||||||||||||||||
| $ | 17,615 | $ | 5,816 | $ | 13,164 | $ | 5,784 | $ | 5,747 | |||||||||||||||||||||||
Capped Call Transactions
On February 27, 2024, in connection with the pricing of the 2030 Notes, the Company entered into privately negotiated capped call transactions (the "2024 Capped Call Transactions"). The 2024 Capped Call Transactions cover approximately 6.6 million shares of the Company's common stock, which represent the number of shares of common stock initially underlying the 2030 Notes. The 2024 Capped Call Transactions are generally expected to reduce potential dilution to our common stock upon any conversion of the 2030 Notes and/or offset any potential cash payments the Company is required to make in excess of the principal amount of converted 2030 Notes, as the case may be, with such reduction and/or offset subject to a cap. The cap price of the 2024 Capped Call Transactions was initially $92.98 per share of common stock, which represents a premium of 75% over the last reported sale price of the common stock of $53.13 per share on February 27, 2024, and is subject to certain adjustments under the terms of the 2024 Capped Call Transactions. The adjusted cap price of the 2024 Capped Call Transactions was approximately $91.57 per share of common stock at November 30, 2025. The cost of the purchased capped calls of $42.2 million was recorded as a reduction to additional paid-in-capital upon settlement in March 2024.
On April 8, 2021, in connection with the pricing of the 2026 Notes, the Company entered into privately negotiated capped call transactions (the "2021 Capped Call Transactions"). The 2021 Capped Call Transactions cover approximately 6.3 million shares of the Company's common stock, which represent the number of shares of common stock initially underlying the 2026 Notes. The 2021 Capped Call Transactions are generally expected to reduce potential dilution to our common stock upon any conversion of the 2026 Notes and/or offset any potential cash payments the Company is required to make in excess of the principal amount of converted 2026 Notes, as the case may be, with such reduction and/or offset subject to a cap. The cap price of the 2021 Capped Call Transactions was initially $89.88 per share of common stock, which represents a premium of 100% over the last reported sale price of the common stock of $44.94 per share on April 8, 2021, and is subject to certain adjustments under the terms of the 2021 Capped Call Transactions. The adjusted cap price of the 2021 Capped Call Transactions was approximately $77.72 per share of common stock at November 30, 2025. The cost of the purchased capped calls of $43.1 million was recorded as a reduction to additional paid-in-capital upon settlement in April 2021.
We elected to integrate the 2021 Capped Call Transactions and the 2024 Capped Call Transactions with the applicable Notes for federal income tax purposes pursuant to applicable U.S. Treasury Regulations. Accordingly, the $43.1 million gross cost of the purchased 2021 Capped Call Transactions and the $42.2 million gross cost of the purchased 2024 Capped Call Transactions will be deductible for income tax purposes as original discount interest over the term of the applicable Notes.
Credit Facility
On July 21, 2025, the Company entered into an amended and restated credit agreement (the "Credit Agreement") with certain lenders, which provides for a $1.5 billion secured revolving credit facility (the "Credit Facility"). The Credit Facility has sublimits for swing line loans up to $25.0 million and for the issuance of standby letters of credit in a face amount up to $25.0 million.
The amount outstanding under our prior secured credit facility is now outstanding under the Credit Facility.
Interest rates for the Credit Facility are determined by reference to a Term Benchmark Rate or a base rate at our option and range from 1.25% to 2.50% above the Term Benchmark Rate for Term Benchmark-based borrowings or from 0.25% to 1.50% above the defined base rate for base rate borrowings, in each case based upon our consolidated total net leverage ratio. During fiscal year 2025, we repaid $130.0 million on the Credit Facility. The interest rate as of November 30, 2025 was 5.92%.
The Credit Facility matures on the earlier of (i) July 21, 2030, and (ii) the date that is 91 days prior to the maturity date of our 2030 Notes subject to certain conditions as set forth in the Credit Agreement, including the repayment of the 2030 Notes, the refinancing of the 2030 Notes including a maturity date that is on or after October 21, 2030, and compliance with a liquidity test when all amounts outstanding will be due and payable in full. Revolving loans may be borrowed, repaid, and reborrowed until the maturity date, at which time all amounts outstanding must be repaid. Accrued interest on the loans is payable quarterly in arrears. As of November 30, 2025, there was $600.0 million outstanding under the revolving credit facility and $2.1 million of letters of credit.
Costs incurred to obtain the Credit Agreement of $6.2 million, along with $5.2 million of unamortized debt issuance costs related to the previous credit agreement, were recorded as debt issuance costs and will be amortized over the term of the debt agreement.
The Credit Agreement contains customary affirmative and negative covenants, including covenants that limit or restrict our ability to, among other things, grant liens, make investments, make acquisitions, incur indebtedness, merge or consolidate, dispose of assets, pay dividends or make distributions, repurchase stock, change the nature of the business, enter into certain transactions with affiliates, and enter into burdensome agreements, in each case subject to customary exceptions for a credit facility of this size and type. We are also required to maintain compliance with a consolidated interest charge coverage ratio and a consolidated senior secured net leverage ratio.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Jan 20, 2026 | Showing above |
| 2024 | Jan 21, 2025 | |
| 2023 | Jan 26, 2024 | |
| 2022 | Jan 27, 2023 | |
| 2021 | Jan 27, 2022 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.