Business Context and Reporting Period
Company: Digital Realty Trust, Inc. and Digital Realty Trust, L.P.
Filing Type: Form 8-K (Current Report)
Date of Report: March 11, 2011
Subject: Regulation FD Disclosure regarding adjustments to conversion rates for Series C and Series D Cumulative Convertible Preferred Stock and exchange rates for Exchangeable Senior Debentures.
Key Financial Metrics
This filing does not report revenue, profit, cash flow, margins, debt levels, or liquidity metrics. The document focuses exclusively on the mechanical adjustment of conversion and exchange rates for specific securities.
Material Changes
Effective March 11, 2011, the company adjusted conversion rates for its preferred stock and exchange rates for its debentures due to dividends declared and paid in excess of the "reference dividend" thresholds set forth in the Articles Supplementary.
- 4.375% Series C Cumulative Convertible Preferred Stock: Conversion rate adjusted to 0.5350 shares of common stock per $25.00 liquidation preference. This adjustment aggregates dividends paid from the quarter ended December 31, 2010, through March 31, 2011.
- 5.500% Series D Cumulative Convertible Preferred Stock: Conversion rate adjusted to 0.6120 shares of common stock per $25.00 liquidation preference. This adjustment aggregates dividends paid from the quarter ended September 30, 2010, through March 31, 2011.
- 4.125% Exchangeable Senior Debentures due 2026: Exchange rate is 31.8250 shares per $1,000 principal amount.
- 5.50% Exchangeable Senior Debentures due 2029: Exchange rate is 23.5360 shares per $1,000 principal amount.
Adjustments are only required when they necessitate a change of at least 1% of the conversion rate; otherwise, they are carried forward.
Guidance, Outlook, and Risks
The filing contains forward-looking statements regarding expected dividend payments and the impact of economic conditions. Management highlights significant risks including:
- Deterioration in global economic, credit, and market conditions.
- Decreases in information technology spending and potential recession impacts.
- Tenant concentration risks, including bankruptcy or lease non-renewals.
- Financing risks, including interest rate increases and refinancing challenges.
- Real estate valuation risks and potential impairment charges.
- Regulatory risks, including the company's ability to maintain REIT status.
Investor Verification Checklist
- Verify the updated conversion rates for Series C and Series D Preferred Stock in the company's latest investor relations materials.
- Confirm the specific dividend payment dates and amounts that triggered these adjustments in the Articles Supplementary.
- Review the company's most recent Form 10-K for detailed financial metrics (revenue, debt, liquidity) not included in this 8-K.
- Monitor future dividend declarations to determine if further conversion rate adjustments will be triggered.