QTS Realty Trust, Inc. (NYSE:QTS) Files An 8-K Entry into a Material Definitive Agreement

QTS Realty Trust, Inc. (NYSE:QTS) Files An 8-K Entry into a Material Definitive Agreement

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Item1.01Entry into a Material Definitive Agreement.

Unsecured Credit Facility

On December 20, 2016, QualityTech, LP (the Operating
Partnership), the operating partnership of QTS Realty Trust, Inc.
(the Company), entered into an unsecured Fifth Amended and
Restated Credit Agreement (the Amended and Restated Agreement)
with KeyBank National Association, as agent, the lenders party
thereto, KeyBanc Capital Markets, Inc., Merrill Lynch, Pierce,
Fenner Smith Incorporated and TD Securities (USA) LLC, as joint
lead arrangers and joint bookrunners, and Bank of America, N.A.
and TD Securities (USA) LLC, as co-syndication agents. The
Amended and Restated Agreement amended and restated the Fourth
Amended and Restated Credit Agreement dated as of October 27,
2015 by and among the Operating Partnership, the lenders party
thereto, KeyBank National Association, as agent, the lenders
party thereto, Bank of America, N.A., as co-syndication agent,
Deutsche Bank Securities Inc., as co-syndication agent, Regions
Bank, as co-syndication agent, and KeyBanc Capital Markets, Inc.,
Merrill Lynch, Pierce, Fenner Smith Incorporated and Regions
Capital Markets, as joint lead arrangers and joint bookrunners.
The Amended and Restated Agreement is guaranteed by substantially
all of the Operating Partnerships subsidiaries.

The Amended and Restated Agreement provides for a term loan of
$300 million, maturing on December 17, 2021 (“Term Loan A”), an
additional term loan of $200 million, maturing on April 27, 2022
(“Term Loan B”), and a revolving credit facility of $700
million, maturing on December 17, 2020, with the option to extend
until December 17, 2021, subject to satisfaction of certain
conditions (collectively, the Unsecured Credit Facility). The
Unsecured Credit Facility may be increased to up to $1.5 billion,
subject to certain conditions, including the consent of the agent
and obtaining necessary commitments. The lenders under the
Unsecured Credit Facility may issue up to $30 million in letters
of credit subject to the satisfaction of certain conditions. As
of December 20, 2016, the term loans were fully funded and $139.0
million was outstanding under the revolving credit facility.

The availability under the revolving credit facility is the
lesser of (i)$700 million, (ii)60% of the unencumbered asset pool
capitalized value (or 65% of the unencumbered asset pool
capitalized value for the two consecutive fiscal quarters
immediately following a material acquisition for which the
Operating Partnership has provided written notice to the Agent)
and (iii)the amount resulting in an unencumbered asset pool debt
yield of 14% (or 12.5% for the two consecutive fiscal quarters
immediately following a material acquisition for which the
Operating Partnership has provided written notice to the Agent).
In the case of clauses (ii) and (iii)of the preceding sentence,
the amount available under the revolving credit facility is
adjusted to take into account any other unsecured debt and
certain capitalized leases.A material acquisition is an
acquisition of properties or assets with a gross purchase price
equal to or in excess of 15% of the Operating Partnership’s
gross asset value (as defined in the Amended and Restated
Agreement) as of the end of the most recently ended quarter for
which financial statements are publicly available.

Amounts outstanding under the Amended and Restated Agreement bear
interest at a variable rate equal to, at the Operating
Partnerships election, LIBOR or a base rate, plus a spread that
will vary depending upon the Companys leverage ratio. For
revolving credit loans, the spread ranges from 1.55% to 2.15% for
LIBOR loans and 0.55% to 1.15% for base rate loans. For term
loans, the spread ranges from 1.50% to 2.10% for LIBOR loans and
0.50% to 1.10% for base rate loans. As of December 20, 2016, the
weighted average interest rate for amounts outstanding under the
Amended and Restated Agreement was 2.22% for revolving credit
loans and 2.16% for term loans.

Upon obtaining an investment grade rating, the Amended and
Restated Credit Agreement permits the Operating Partnership to
request revolving loan borrowings with interest rates and terms
that are to be set to competitive bid procedures (“bid loans”);
however, the lenders are not required to extend borrowings to
such competitive bid procedures.The sum of all outstanding bid
loans may not exceed 50% of the total revolving credit
commitment.The bid loan sublimit is a part of, and not in
addition to, the total revolving credit commitment.

The Amended and Restated Agreement has customary representations
and warranties, and the ability to borrow under the facility is
subject to ongoing compliance with a number of customary
affirmative and negative covenants, including limitations on
liens, mergers, consolidations, investments, distributions, asset
sales and affiliate transactions, as well as financial covenants,
including the following:

the Operating Partnership’s and its subsidiaries’
consolidated total unsecured debt plus any capitalized
lease obligations with respect to the unencumbered asset
pool properties may not exceed 60% of the unencumbered

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asset pool value (or 65% of the unencumbered asset pool
value for the two consecutive fiscal quarters
immediately following a material acquisition for which
the Operating Partnership has provided written notice
to the Agent);

the unencumbered asset pool debt yield cannot be less
than 14% (or 12.5% for the two consecutive fiscal
quarters immediately following a material acquisition
for which the Operating Partnership has provided
written notice to the Agent);

a minimum fixed charge coverage ratio (defined as the
ratio of consolidated EBITDA, subject to certain
adjustments, to consolidated fixed charges) for the
prior two most recently-ended calendar quarters of 1.70
to 1.00;

a maximum debt to gross asset value (as defined in the
Amended and Restated Agreement) ratio of 60% (or 65%
for the two consecutive fiscal quarters immediately
following a material acquisition for which the
Operating Partnership has provided written notice to
the Agent);

tangible net worth (as defined in the Amended and
Restated Agreement) cannot be less than the sum of
$1,179,931,500 plus 75% of thenet proceeds from any
future equity offerings;

a maximum distribution payout ratio of the greater of
(i)95% of the Companys Funds from Operations (as
defined in the Amended and Restated Agreement) and
(ii)the amount required for the Company to qualify as a
REIT.

The Amended and Restated Agreement includes customary events of
default, and the occurrence of an event of default will permit
the lenders to terminate commitments to lend under the Amended
and Restated Agreement and accelerate payment of all amounts
outstanding thereunder.

A copy of the Amended and Restated Agreement is attached to
this Current Report on Form 8-K as Exhibit 10.1 and
incorporated herein by reference. The summary set forth above
is qualified in its entirety by reference to Exhibit 10.1.

Unsecured Springing Guaranty

In connection with the Amended and Restated Agreement, the
Company entered into a Third Amended and Restated Unconditional
Guaranty of Payment and Performance dated as of December 20,
2016 (the Amended Unsecured Springing Guaranty), which amended
and restated the Companys Second Amended and Restated
Unconditional Guaranty of Payment and Performance dated October
27, 2015. The Amended Unsecured Springing Guaranty increased
the Companys total potential guaranty amount to $1.5 billion,
which is the total commitment under the Amended and Restated
Agreement upon the full exercise of the accordion feature.

A copy of the Amended Unsecured Springing Guaranty is attached
to this Current Report on Form 8-K as Exhibit 10.2 and
incorporated herein by reference. The summary set forth above
is qualified in its entirety by reference to Exhibit 10.2.

Item2.03Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.

The disclosure contained in Item1.01 under the sections
Unsecured Credit Facility and Unsecured Springing Guaranty is
incorporated herein by reference.

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Item9.01Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number

Exhibit Description

10.1

Fifth Amended and Restated Credit Agreement dated as of
December 20, 2016 by and among QualityTech, LP, as
borrower, KeyBank National Association, as agent, the
lenders party thereto, KeyBanc Capital Markets, Inc.,
Merrill Lynch, Pierce, Fenner Smith Incorporated and TD
Securities (USA) LLC, as joint lead arrangers and joint
bookrunners, and Bank of America, N.A. and TD
Securities (USA) LLC, as co-syndication agents.

10.2

Third Amended and Restated Unconditional Guaranty of
Payment and Performance dated as of December 20, 2016
by QTS Realty Trust, Inc. (to KeyBank National
Association).

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About QTS Realty Trust, Inc. (NYSE:QTS)

QTS Realty Trust, Inc. (QTS) is a provider of secure, compliant data center solutions, hybrid cloud and fully managed services. The Company owns, develops and operates carrier-neutral and multi-tenant data centers. It operates through a portfolio of investments in over 20 data centers located primarily in the United States with others in Canada, Europe and the Asia-Pacific region. Its data centers are facilities that house the network and computer equipment of multiple customers and provide access to a range of communications carriers. It has an integrated platform through which it owns and operates its data centers and provides a range of information technology (IT) infrastructure solutions. QTS’s spectrum of core data center products are referred to as 3Cs, which consists of Custom Data Center (C1), Colocation (C2) and Cloud and Managed Services (C3). Its properties include Atlanta, Georgia; Suwanee, Georgia; Dallas-Fort Worth, Texas; Miami, Florida, and Sacramento, California.

QTS Realty Trust, Inc. (NYSE:QTS) Recent Trading Information

QTS Realty Trust, Inc. (NYSE:QTS) closed its last trading session up +0.28 at 48.72 with 113,058 shares trading hands.

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