Axon Enterprise Announces $1.0B 0% Convertible Senior Notes Offering and Expands Revolver to $500M

Executive Summary

On September 15, 2026, Axon Enterprise, Inc. (NASDAQ: AXON) reported two significant capital structure events via Form 8-K:

1. $1.0 Billion Convertible Senior Notes Offering: Axon launched a registered public offering of $1.0 billion in 0% convertible senior notes due 2031, alongside an underwriter over-allotment option of up to $150.0 million.
2. Credit Agreement Second Amendment: Axon executed an amendment with JPMorgan Chase Bank, N.A. to upsize its existing revolving credit facility from $300.0 million to $500.0 million (with an additional $150.0 million accordion feature) and extended maturity to September 2031, conditional upon the consummation of the notes offering.

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Key Terms & Details of the Transactions

1. 0% Convertible Senior Notes Due 2031

• Principal Amount: $1.0 billion (with up to $150 million over-allotment option).
• Coupon / Interest: 0% regular interest; principal does not accrete.
• Maturity Date: September 15, 2031, unless earlier converted, redeemed, or repurchased.
• Settlement Election: Axon may settle conversions in cash, shares of common stock, or a combination thereof.
• Early Redemption: On or after September 20, 2029 (subject to the 130% stock price condition for 20 out of 30 trading days) or via cleanup redemption if less than 10% principal remains outstanding.
• Capped Call Transactions: Entered into with option counterparties to mitigate potential equity dilution and/or offset cash payments upon conversion.

2. Credit Facility Upsize & Extension

• Facility Capacity: Increased from $300.0 million to $500.0 million with a $150.0 million incremental facility capacity.
• Maturity: Extended from March 11, 2030, to the earliest of 5 years (September 18, 2031) or 91 days prior to convertible debt maturities unless defeased/refinanced.
• Pricing: SOFR + 1.25% to 1.75% based on net leverage ratio; 0.15% per annum unused commitment fee.
• Covenants: Maximum net leverage ratio of 3.50x (with a 1.00x step-up post-acquisition) and minimum interest coverage ratio of 3.50x.

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Strategic & Market Implications

• Liquidity & Growth Capital: Combined, these actions provide Axon with substantial non-dilutive/dilution-mitigated liquidity to fund operational growth, R&D initiatives, and potential M&A.
• Low Cost of Debt: Securing a 0% coupon on $1.0B+ minimizes interest burden while locking in multi-year capital.
• Hedging & Share Price Dynamics: Derivative hedging by capped call counterparties may influence trading volume and share price behavior around the pricing window.