Company: CVLT
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0001169561-25-000069
Chunk: 54

Company: COMMVAULT SYSTEMS INC
Filing Date: 2025-07-30
Form: 10-Q
Item: Item 8
Chunk 54
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2025, we recorded a reduction to expense of $0.5 million related to the final achievement under our contingent consideration arrangement related to the acquisition of Appranix, Inc. The arrangement, with final aggregate consideration 

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of $1.9 million, was contingent upon meeting certain financial metrics by June 30, 2025 and could have ranged up to $4.0 million.

Income Tax Expense

Income tax expense was $3.4 million in the three months ended June 30, 2025 compared to expense of $2.1 million in the three months ended June 30, 2024. The increase in income tax expense compared to the same period in the prior year relates primarily to estimated current federal taxes. We continue to monitor the impact of new global and U.S. legislation on our effective tax rate.

Liquidity and Capital Resources

In recent fiscal years, our principal source of liquidity has been cash provided by operations. As of June 30, 2025, our cash and cash equivalents balance was $363.2 million, of which approximately $289.7 million was held outside of the United States by our foreign legal entities. These balances are dispersed across approximately 35 international locations around the world. We believe that such dispersion meets the current and anticipated future liquidity needs of our foreign legal entities. In the event we need to repatriate funds from outside of the United States, such repatriation would likely be subject to restrictions by local laws and/or tax consequences, including foreign withholding taxes.

On April 15, 2025, we refinanced our existing $100 million senior secured revolving credit facility, replacing it with a new five-year $300 million senior secured revolving credit facility (the “Credit Facility”) with JPMorgan Chase Bank, N.A, as administrative agent, and the lenders party thereto. The Credit Facility is available for share repurchases, general corporate purposes, and letters of credit. The Credit Facility contains financial maintenance covenants, including a leverage ratio and interest coverage ratio. The Credit Facility also contains certain customary events of default which would permit the lenders to, among other things, declare all loans then outstanding to be immediately due and payable if such default is not cured within applicable grace periods. The Credit Facility also limits our ability to incur certain additional indebtedness, create or permit liens on assets, make acquisitions or investments, make loans or advances, sell or transfer assets, pay dividends or distributions, and engage in certain transactions with affiliates. Outstanding borrowings under the