Item 1.01 Entry into a Material Definitive Agreement.
Purchase Agreement
On January 9, 2020, MongoDB, Inc. ("MongoDB") entered into a purchase agreement
(the "Purchase Agreement") with Morgan Stanley & Co. LLC, Goldman Sachs & Co.
LLC, Barclays Capital Inc. and Citigroup Global Markets Inc., as representatives
of the several initial purchasers named therein (the "Initial Purchasers"),
relating to the sale by MongoDB of an aggregate of $1.0 billion principal amount
of its 0.25% Convertible Senior Notes due 2026 (the "Notes") to qualified
institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as
amended (the "Securities Act"). MongoDB also granted the Initial Purchasers an
option to purchase, within a 13-day period from, and including, the initial
issuance date of the Notes, up to an aggregate of $150.0 million additional
principal amount of Notes. The Initial Purchasers exercised in full this option
to purchase additional Notes on January 10, 2020. Pursuant to the terms of the
Purchase Agreement, the parties have agreed to indemnify each other against
certain liabilities, including certain liabilities under the Securities Act.
A copy of the Purchase Agreement is filed as Exhibit 99.1 to this Current Report
on Form 8-K and is incorporated by reference herein. The foregoing description
of the Purchase Agreement does not purport to be complete and is qualified in
its entirety by reference to such exhibit.
Indenture and Notes
On January 14, 2020, MongoDB issued an aggregate of $1.15 billion principal
amount of Notes pursuant to an Indenture, dated January 14, 2020 (the
"Indenture"), between MongoDB and U.S. Bank National Association, as trustee
(the "Trustee"). The Notes will bear interest from January 14, 2020 at a rate of
0.25% per annum payable semiannually in arrears on January 15 and July 15 of
each year, beginning on July 15, 2020. The Notes will mature on January 15,
2026, unless earlier converted, redeemed or repurchased.
The net proceeds from this offering are expected to be approximately $1.13
billion, after deducting the Initial Purchasers' discount and estimated offering
expenses payable by MongoDB. MongoDB used approximately $92.9 million of the net
proceeds from this offering to pay the cost of the capped call transactions
described below. MongoDB also used approximately $479.2 million of the net
proceeds to repurchase for cash approximately $210.0 million of the aggregate
principal amount of MongoDB's outstanding 0.75% Convertible Senior Notes due
2024 (the "2024 Notes") through individually privately negotiated transactions
concurrently with the offering of the Notes. MongoDB intends to use the
remainder of the proceeds from this offering for working capital and other
general corporate purposes. MongoDB may also use a portion of the proceeds from
this offering for acquisitions or strategic investments in businesses or
technologies, although it does not currently have any plans for any such
acquisitions or investments.
Holders of the Notes may convert their Notes at their option at any time prior
to the close of business on the business day immediately preceding October 15,
2025, only under the following circumstances: (1) during any fiscal quarter
commencing after the fiscal quarter ending on April 30, 2020 (and only during
such fiscal quarter), if the last reported sale price of MongoDB's Class A
common stock for at least 20 trading days (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 is greater than or equal to 130%
of the conversion price on each applicable trading day; (2) during the
five-business day period after any five 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 of
MongoDB's Class A common stock and the conversion rate for the Notes on each
such trading day; (3) if MongoDB calls such Notes for redemption, at any time
prior to the close of business on the scheduled trading day immediately
preceding the redemption date; or (4) upon the occurrence of specified corporate
events. On or after October 15, 2025, holders may convert all or any portion of
their Notes at any time prior to the close of business on the scheduled trading
day immediately preceding the maturity date regardless of the foregoing
conditions. Upon conversion, MongoDB will satisfy its conversion obligation by
paying or delivering, as the case may be, cash, shares of MongoDB's Class A
common stock or a combination of cash and shares of MongoDB's Class A common
stock, at MongoDB's election.
The conversion rate for the Notes is initially 4.7349 shares of MongoDB's Class
A common stock per $1,000 principal amount of Notes (equivalent to an initial
conversion price of approximately $211.1977 per share of MongoDB's Class A
common stock). The conversion rate is subject to adjustment in some events but
will not be adjusted for any accrued and unpaid interest. In addition, following
certain corporate events that occur prior to the maturity date or following
MongoDB's issuance of a notice of redemption, MongoDB will increase the
conversion rate for a holder who elects to convert its Notes in connection with
such a corporate event or convert its notes called for redemption during the
related redemption period in certain circumstances.
MongoDB may not redeem the Notes prior to January 20, 2023. On or after January
20, 2023, MongoDB may redeem for cash all or any portion of the Notes, at its
option, if the last reported sale price of MongoDB's Class A common stock has
. . .
Item 2.03 Creation of a Direct Financial 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 Sale 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 sold to the Initial Purchasers pursuant to the Purchase Agreement
in reliance on the exemption from the registration requirements provided by
Section 4(a)(2) of the Securities Act and the Notes were resold to qualified
institutional buyers as defined in, and in reliance on, Rule 144A of the
Securities Act. To the extent that any shares of Class A common stock are issued
upon conversion of the Notes, they will be issued in transactions anticipated to
be exempt from registration under the Securities Act by virtue of Section
3(a)(9) thereof, because no commission or other remuneration is expected to be
paid in connection with conversion of the Notes, and any resulting issuance of
shares of Class A common stock.
The offer and sale of the Notes and the Class A common stock issuable upon
conversion of the Notes have not been and will not be registered under the
Securities Act or the securities laws of any other jurisdiction, and such
securities may not be offered or sold in the United States absent registration
or an applicable exemption from registration requirements. This Current Report
on Form 8-K does not constitute an offer to sell, or a solicitation of an offer
to buy, any security and shall not constitute an offer, solicitation or sale in
any jurisdiction in which such offering would be unlawful.
Item 8.01. Other Events.
On January 8, 2020, MongoDB issued a press release announcing the proposed Note
offering. A copy of the press release is filed herewith as Exhibit 99.3.
On January 10, 2020, MongoDB issued a press release announcing the pricing of
the Note offering. A copy of the press release is filed herewith as Exhibit
99.4.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the
meaning of the federal securities laws. These statements include, but are not
limited to, statements regarding the offering of the Notes, the effects of the
capped call transactions, and MongoDB's expectations regarding the expected net
proceeds from the offering and use of those net proceeds. Forward-looking
statements include all statements that are not historical facts. In some cases,
forward-looking statements can be identified by terms such as "anticipates,"
"believes," "could," "estimates," "expects," "intends," "may," "plans,"
"potential," "will," or similar expressions and the negatives of those words.
Forward-looking statements involve substantial risks and uncertainties that may
cause actual results to differ materially from those that MongoDB expects. These
risks and uncertainties include market risks, trends and conditions. These and
other risks are more fully described in MongoDB's filings with the Securities
and Exchange Commission, including in the section titled "Risk Factors" in
MongoDB's Annual Report on Form 10-K for the fiscal year ended January 31, 2019
and its Quarterly Report on Form 10-Q for the fiscal quarter ended October 31,
2019. In light of these risks, you should not place undue reliance on such
forward-looking statements. Forward-looking statements represent MongoDB's
beliefs and assumptions only as of the date of this Current Report on Form 8-K.
MongoDB disclaims any obligation to update forward-looking statements.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
Exhibit No. Description
4.1 Indenture, dated as of January 14, 2020, by and between MongoDB,
Inc. and U.S. Bank National Association, as Trustee.
4.2 Form of Global Note, representing MongoDB, Inc.'s 0.25% Convertible
Senior Notes due 2026 (included as Exhibit A to the Indenture filed as
Exhibit 4.1).
99.1 Purchase Agreement, dated January 9, 2020, by and among MongoDB,
Inc. and Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, Barclays
Capital Inc. and Citigroup Global Markets Inc.
99.2 Form of Confirmation for Capped Call Transactions.
99.3 Press Release issued by MongoDB, Inc. on January 8, 2020.
99.4 Press Release issued by MongoDB, Inc. on January 10, 2020.
104 The cover page from this Current Report on Form 8-K, formatted in
Inline XBRL.
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