8-KMaterial AgreementsFinancial EventsOther Events+1

DIGITAL REALTY TRUST, INC. 8-K Report, Material Agreement (Sep 27, 2022)

Filed September 27, 2022For Securities:DLRDLR-PJDLR-PKDLR-PL

Summary

Digital Realty Trust, L.P. has successfully completed an underwritten public offering of $550 million in aggregate principal amount of 5.550% Senior Notes due 2028. These notes are general unsecured senior obligations, ranking equally with existing unsecured senior indebtedness but subordinated to secured debt and subsidiary liabilities. The offering, which closed on September 27, 2022, was made under an effective shelf registration statement and is fully and unconditionally guaranteed by the parent entity, Digital Realty Trust, Inc. Investors should note the terms of the indenture, which includes restrictive covenants regarding additional indebtedness and maintaining unencumbered assets. The company has the option to redeem the notes prior to maturity, with a "Par Call Date" feature allowing redemption at par plus accrued interest on or after one month before maturity. Key events of default are outlined, which could lead to accelerated maturity of the notes.

Key Highlights

  • 1Completed a $550 million public offering of 5.550% Senior Notes due 2028.
  • 2Notes are general unsecured senior obligations, guaranteed by Digital Realty Trust, Inc.
  • 3The offering was conducted under an effective shelf registration statement.
  • 4The indenture includes covenants on incurring additional debt and maintaining unencumbered assets.
  • 5The company can redeem the notes prior to maturity under specific conditions, including a "Par Call" provision.
  • 6Several events of default are defined, which could trigger accelerated payment of the notes.
  • 7The issuance represents a material definitive agreement and the creation of a direct financial obligation.

Frequently Asked Questions

This 8-K filing announces Digital Realty Trust, L.P.'s completion of a $550 million public offering of its 5.550% Senior Notes due 2028. It also details the material definitive agreement entered into for this offering and the creation of a direct financial obligation.

The notes have a principal amount of $550 million, bear a 5.550% annual interest rate payable semi-annually on January 15 and July 15, and mature on January 15, 2028. They are unsecured senior obligations of Digital Realty Trust, L.P., guaranteed by Digital Realty Trust, Inc.

Digital Realty can redeem the notes in whole or in part prior to maturity. Before December 15, 2027 (the "Par Call Date"), redemption is at a price based on the present value of remaining payments plus 25 basis points over the Treasury Rate, or 100% of principal, whichever is greater. On or after the Par Call Date, redemption is at 100% of the principal amount.

As general unsecured senior obligations, these notes rank equally with other unsecured senior indebtedness of Digital Realty Trust, L.P. However, they are effectively subordinated to any secured indebtedness and to the liabilities and preferred equity of the company's subsidiaries. In the event of bankruptcy or liquidation, holders of secured debt would typically be paid before unsecured debt holders.