Easterly Government Properties Inc. filed SEC Form 8-K: Creation of a Direct Financial Obligation, Regulation FD Disclosure, Financial Statements and Exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On May 29, 2024, Easterly Government Properties, Inc. (the “Company”), and its operating partnership, Easterly Government Properties LP (the “Operating Partnership”), entered into a master note purchase agreement (the “Purchase Agreement”), with the purchasers named therein (the “Purchasers”). Pursuant to the Purchase Agreement, on May 29, 2024, the Operating Partnership issued $150,000,000 of fixed rate, senior unsecured notes (the “Series A Notes”) and is expected to issue, on or around August 14, 2024, subject to customary closing conditions, $50,000,000 of fixed rate, senior unsecured notes (the “Series B Notes” and, together with the Series A Notes, the “Notes”), in each case to the Purchasers. The following table sets forth the principal amount, interest rate and maturity date of the Notes by series (dollars in thousands):
Series |
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Principal Amount |
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Interest Rate |
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Maturity Date |
Series A |
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$ 150,000 |
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6.56% |
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May 29, 2033 |
Series B |
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$ 50,000 |
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6.56% |
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August 14, 2033 |
Interest on the Notes will be payable semiannually. Pursuant to the Purchase Agreement, the Operating Partnership will be permitted to prepay at any time all, or from time to time any part of, the Notes, in the amount not less than 5% of the aggregate principal amount of the Notes then outstanding at (i) 100% of the principal amount so prepaid, together with accrued interest, and (ii) a make-whole amount that is calculated by discounting the value of the remaining scheduled interest payments that would otherwise be payable through the scheduled maturity date of the applicable Notes on the principal amount being prepaid. The Operating Partnership will have the right to make tender offers and may be required to make other prepayment offers under the terms set forth in the Purchase Agreement.
The Company and certain subsidiaries of the Operating Partnership (the “Subsidiary Guarantors”) will guarantee the obligations under the Notes.
Subject to the terms of the Purchase Agreement and the Notes, upon certain events of default, including, but not limited to, (i) a default in the payment of any principal, “make-whole” amount or interest under the Notes, and (ii) a default in the payment of certain other indebtedness of the Operating Partnership or of the Company or of the Subsidiary Guarantors, the principal and accrued and unpaid interest and the make-whole amount on the outstanding Notes will become due and payable at the option of the holders.
The Purchase Agreement and Notes also contains various covenants (including, among others, financial covenants with respect to consolidated net worth, fixed charges and consolidated leverage and covenants relating to liens) and if the Operating Partnership or the Company breaches any of these covenants, the principal and accrued and unpaid interest and the make-whole amount on the outstanding Notes will become due and payable at the option of the holders.
Net proceeds from the private placement of the Notes are intended to be used to repay borrowings outstanding under the Company’s senior unsecured revolving credit facility, for general corporate purposes, or a combination of the foregoing. The Notes have not been and will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act. The Series A Notes were, and the Series B Notes are to be, issued and sold by the Operating Partnership in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act.
Item 7.01 Regulation FD Disclosure.
On May 30, 2024, the Company issued a press release announcing the issuance by the Operating Partnership of the Series A Notes and the future expected issuance of the Series B Notes. A copy of that press release is furnished as Exhibit 99.1 to this Current Report. The information in this Item 7.01 of this Current Report, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall such information be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act regardless of any general incorporation language in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits:
Exhibit Number |
Description |
99.1 |
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104 |
Cover Page Interactive Data File (embedded within the inline XBRL document.) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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EASTERLY GOVERNMENT PROPERTIES, INC. |
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Date: |
May 30, 2024 |
By: |
/s/ Franklin V. Logan |
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Franklin V. Logan |