8-KMaterial AgreementsShareholder MattersCorporate Changes+1

Public Storage 8-K Report, Material Agreement (Jun 9, 2021)

Filed June 9, 2021For Securities:PSAPSA-PRPSA-PFPSA-PGPSA-PHPSA-PIPSA-PJPSA-PMPSA-PNPSA-POPSA-PPPSA-PQPSA-PSPSA-PKPSA-PL

Summary

Public Storage (PSA) filed an 8-K on June 8, 2021, to disclose the successful issuance and sale of 21,000,000 depositary shares representing a 4.000% Cumulative Preferred Share, Series P. The company also granted underwriters an option to purchase an additional 3,150,000 depositary shares, which was fully exercised. This action effectively raised a significant amount of capital for the company through preferred equity. The issuance of these Series P Preferred Shares introduces specific terms and conditions that may affect the company's ability to make distributions or take other actions concerning its other equity securities that are junior to or on parity with these preferred shares, particularly if preferred distributions are not declared. The filing also confirms that the Board of Trustees is authorized to issue up to 100,000,000 preferred shares.

Key Highlights

  • 1Public Storage successfully sold 21,000,000 depositary shares representing 4.000% Cumulative Preferred Shares, Series P, on June 7, 2021.
  • 2The underwriters exercised their over-allotment option in full, purchasing an additional 3,150,000 depositary shares.
  • 3The Series P Preferred Shares carry a fixed cumulative dividend rate of 4.000%.
  • 4The issuance of these preferred shares may impose restrictions on distributions, redemptions, or other actions related to junior or parity securities if preferred dividends are not paid.
  • 5The company's Board of Trustees has the authorization to issue up to 100,000,000 preferred shares.
  • 6Key financial institutions, including affiliates of BofA Securities, Morgan Stanley, UBS, and Wells Fargo, acted as underwriters and also have existing relationships with PSA through its revolving credit facility.

Frequently Asked Questions

The primary purpose of this 8-K filing was to report on the entry into a material definitive agreement for the sale of new preferred stock (depositary shares) and to announce the completion of that offering, including the exercise of the over-allotment option.

While the exact amount raised isn't stated in this specific 8-K, the company sold a total of 24,150,000 depositary shares (21,000,000 initial + 3,150,000 over-allotment). Investors would need to refer to the Underwriting Agreement (Exhibit 1.1) or a subsequent filing for the specific price per share and total gross proceeds.

The Series P Preferred Shares are designated as 4.000% Cumulative Preferred Shares. This means they accrue a fixed dividend of 4.000% annually, which must be paid before any distributions can be made to common shareholders or parity securities, under certain conditions.

Yes, the issuance of the Series P Preferred Shares introduces certain restrictions. In the event that Public Storage does not declare distributions on these preferred shares during any distribution period, the company's ability to make distributions with respect to, or redeem, purchase, acquire, or make a liquidation payment on, any other shares of beneficial interest that rank junior to or on parity with the Series P Preferred Shares will be subject to limitations.