Item 1.01 Entry Into a Material Definitive Agreement
On April 23, 2021, Public Storage (the “Company”) completed the previously announced offering of $700,000,000 Floating Rate Senior Notes due 2024 (the “Floating Rate Notes”), $650,000,000 1.850% Senior Notes due 2028 (the “2028 Notes”) and $650,000,000 2.300% Senior Notes due 2031 (the “2031 Notes” and, together with the Floating Rate Notes and the 2028 Notes, the “Notes”),
The Notes have been issued pursuant to an Indenture, dated as of September 18, 2017 (the “Base Indenture”), between the Company, as issuer, and Wells Fargo Bank, National Association, as trustee (the “Trustee”), as supplemented by the Fifth Supplemental Indenture, dated as of April 23, 2021, relating to the Floating Rate Notes (the “Fifth Supplemental Indenture”), the Sixth Supplemental Indenture, dated as of April 23, 2021, relating to the 2028 Notes (the “Sixth Supplemental Indenture”), and the Seventh Supplemental Indenture, dated as of April 23, 2021, relating to the 2031 Notes (the “Seventh Supplemental Indenture” and, collectively with the Fifth Supplemental Indenture, the Sixth Supplemental Indenture and the Base Indenture, the “Indenture”), each between the Company and the Trustee.
The Floating Rate Notes bear interest at a variable rate equal to Compounded SOFR (as defined in the Fifth Supplemental Indenture), reset quarterly, plus 47 basis points (0.470%), the 2028 Notes bear interest at 1.850% per annum and the 2031 Notes bear interest at 2.300% per annum, in each case accruing from April 23, 2021. Interest on the Floating Rate Notes is payable quarterly on January 23, April 23, July 23 and October 23 of each year, commencing July 23, 2021. Interest on the 2028 Notes and the 2031 Notes is payable semi-annually on May 1 and November 1 of each year, commencing November 1, 2021. The Floating Rate Notes will mature on April 23, 2024, the 2028 Notes will mature on May 1, 2028 and the 2031 Notes will mature on May 1, 2031. The Notes are the Company’s direct, unsecured and unsubordinated obligations and will rank equally in right of payment with all of the Company’s existing and future unsecured and unsubordinated indebtedness.
The Company may redeem the Floating Rate Notes at any time on or after April 23, 2022 in whole, or from time to time in part, at a redemption price equal to 100% of the principal amount of the Floating Rate Notes to be redeemed. The Company may redeem the 2028 Notes or the 2031 Notes at any time in whole, or from time to time in part, at the applicable make-whole redemption price specified in the Indenture. If the 2028 Notes or the 2031 Notes are redeemed on or after March 1, 2028 (two months prior to the applicable maturity date) or on or after February 1, 2031 (three month prior to the applicable maturity date), respectively, the redemption price will be equal to 100% of the principal amount of the Notes being redeemed plus accrued and unpaid interest thereon to, but not including, the redemption date.
The Indenture contains certain covenants that, among other things, limit the ability of the Company, subject to exceptions, to incur secured and unsecured indebtedness and to consummate a merger, consolidation or sale of all or substantially all of its assets. In addition, the Indenture requires the Company to maintain total unencumbered assets of at least 125% of total unsecured indebtedness. These covenants are subject to a number of important exceptions and qualifications. The Indenture also provides for customary events of default which, if any of them occurs, would permit or require the principal of and accrued interest on the Notes to become or to be declared due and payable.
The foregoing description is a summary of the terms of the Indenture and the Notes and does not purport to be a complete statement of the parties’ rights and obligations thereunder. The foregoing description is qualified in its entirety by reference to the full text of the Base Indenture and the Fifth Supplemental Indenture, the Sixth Supplemental Indenture and the Seventh Supplemental Indenture, as applicable (including the forms of Notes), copies of which are attached as Exhibits 4.1, 4.2, 4.3 and 4.4 to this Current Report on Form 8-K and incorporated by reference herein.
The offering of the Notes was made pursuant to a shelf registration statement on Form S-3 (File No. 333-231510) filed by the Company with the Securities and Exchange Commission (the “SEC”) on May 15, 2019. A prospectus supplement, dated April 14, 2021, relating to the Notes and supplementing the prospectus was filed with the SEC pursuant to Rule 424(b)(5) under the Securities Act of 1933, as amended.
