8-KMaterial AgreementsFinancial EventsExhibits & Filings

DIGITAL REALTY TRUST, INC. 8-K Report, Material Agreement (Apr 1, 2014)

Filed April 1, 2014For Securities:DLRDLR-PJDLR-PKDLR-PL

Summary

Digital Realty Trust, Inc. (DLR) announced on April 1, 2014, through its wholly-owned subsidiary Digital Stout Holding, LLC, the issuance of £300 million aggregate principal amount of 4.750% Guaranteed Notes due 2023. These notes are senior unsecured obligations of the subsidiary, fully and unconditionally guaranteed by Digital Realty Trust, Inc. and Digital Realty Trust, L.P. The offering was conducted outside the United States under Regulation S, and the net proceeds of approximately £295.2 million are intended for repaying revolving credit facility borrowings, property acquisitions, development funding, and general working capital. This debt issuance represents a strategic move to strengthen the company's capital structure and provide financial flexibility for growth initiatives. Investors should note the specific terms of the indenture, including restrictive covenants on incurring additional indebtedness and maintaining unencumbered assets, as well as the potential for redemption and events of default. The involvement of Deutsche Bank entities in various capacities, including as trustee, paying agent, and lenders, is also detailed.

Key Highlights

  • 1Digital Stout Holding, LLC issued £300 million in 4.750% Guaranteed Notes due 2023.
  • 2The Notes are guaranteed by Digital Realty Trust, Inc. and Digital Realty Trust, L.P.
  • 3Net proceeds of approximately £295.2 million will be used for debt repayment, acquisitions, development, and working capital.
  • 4The offering was conducted outside the U.S. under Regulation S.
  • 5The indenture includes covenants limiting additional indebtedness and requiring unencumbered asset maintenance.
  • 6Notes are redeemable at the company's option, with potential make-whole premiums before maturity.
  • 7Several conditions are defined as events of default, potentially leading to accelerated maturity.

Frequently Asked Questions

The primary purpose is to raise capital for Digital Realty Trust's operational needs and growth strategies, including repaying existing debt, acquiring new properties, funding development projects, and general corporate purposes.

The notes have a principal amount of £300 million, mature in 2023, and carry a fixed interest rate of 4.750% per annum, payable semi-annually. They are senior unsecured obligations of the issuing subsidiary, guaranteed by the parent entities.

Yes, the indenture includes restrictive covenants that limit the company's ability to incur additional indebtedness and require it to maintain a pool of unencumbered assets. There are also provisions for redemption at the company's option and specific events that constitute default, which could lead to accelerated repayment.

The net proceeds of approximately £295.2 million are intended to be used to temporarily repay borrowings under the company's global revolving credit facility, acquire additional properties, fund development opportunities, and for general working capital purposes, or a combination thereof.