Equity

12 Months Ended

Dec. 31, 2019

Equity

Equity

11. Equity

Equity Offering

In December 2019, the Company completed an underwritten public offering of approximately 3.5 million shares of its common stock, par value $0.01 per share, at a price to the public of $85.60 per share. Net proceeds to the Company, after deducting underwriting discounts and commissions and other expenses paid by the Company, were approximately $283 million. The Company intends to use a portion of the net proceeds to fund the approximately $134 million cash portion of the consideration for the acquisition of Block 21 discussed in Note 1, “Description of the Business and Summary of Significant Accounting Policies,” and the related fees and expenses of the acquisition. The Company intends to use the remaining net proceeds, or all of the net proceeds if the Block 21 acquisition is not consummated, for general corporate purposes, including future acquisitions or investments and the repayment of any indebtedness outstanding under the Revolver.

Dividends

During 2019, the Company’s board of directors declared quarterly dividends totaling $3.60 per share of common stock for the full year, or an aggregate of $188.3 million in cash.

During 2018, the Company’s board of directors declared quarterly dividends totaling $3.40 per share of common stock for the full year, or an aggregate of $174.5 million in cash.

During 2017, the Company’s board of directors declared quarterly dividends totaling $3.20 per share of common stock for the full year, or an aggregate of $163.7 million in cash.

To maintain its qualification as a REIT for federal income tax purposes, the Company must distribute at least 90% of its REIT taxable income each year. The Company’s board of directors has approved the Company’s current dividend policy pursuant to which the Company plans to pay a quarterly cash dividend to stockholders in an amount equal to an annualized payment of at least 50% of adjusted funds from operations (as defined by the Company) less maintenance capital expenditures or 100% of REIT taxable income on an annual basis, whichever is greater. The declaration, timing

and amount of dividends will be determined by future action of the Company’s board of directors. The dividend policy may be altered at any time by the Company’s board of directors.

Treasury Stock

On December 18, 2008, following approval by the Human Resources Committee and the Board of Directors, the Company and the Company’s Chairman of the Board of Directors and Chief Executive Officer (“Executive”) entered into an amendment to Executive’s employment agreement. The amendment provided Executive with the option of making an irrevocable election to invest his existing Supplemental Employee Retirement Plan (“SERP”) benefit in Company common stock, which election Executive subsequently made. The investment was made by a rabbi trust in which, during January 2009, the independent trustee of the rabbi trust purchased shares of Company common stock in the open market in compliance with applicable law. Executive is only entitled to a distribution of the Company common stock held by the rabbi trust in satisfaction of his SERP benefit. As such, the Company believes that the ownership of shares of common stock by the rabbi trust and the distribution of those shares to Executive in satisfaction of his SERP benefit meets the requirements necessary so that the Company will not recognize any increase or decrease in expense as a result of subsequent changes in the value of the Company common stock and the purchased shares are treated as treasury stock and the SERP benefit is included in additional paid-in capital in the Company’s accompanying consolidated financial statements. The increase in treasury stock for a particular year represents dividends received on shares of Company common stock held by the rabbi trust.

Accumulated Other Comprehensive Loss

Changes in accumulated other comprehensive loss by component consisted of the following (amounts in thousands):

			Other-Than-
	Minimum		Temporary
	Pension		Impairment of		Interest Rate
	Liability		Investment		Derivatives		Total
Balance, December 31, 2016	$	(22,268)	$	—	$	—	$	(22,268)
Gains (losses) arising during period		3,111		(6,543)		—		(3,432)
Amounts reclassified from accumulated other comprehensive loss		60		—		—		60
Income tax expense		(1,052)		—		—		(1,052)
Net other comprehensive income (loss)		2,119		(6,543)		—		(4,424)
Balance, December 31, 2017	$	(20,149)	$	(6,543)	$	—	$	(26,692)
Losses arising during period		(2,231)		—		—		(2,231)
Amounts reclassified from accumulated other comprehensive loss		(64)		333		—		269
Income tax benefit		630		—		—		630
Net other comprehensive income (loss)		(1,665)		333		—		(1,332)
Balance, December 31, 2018	$	(21,814)	$	(6,210)	$	—	$	(28,024)
Gains arising during period		693		—		3,539		4,232
Amounts reclassified from accumulated other comprehensive loss		97		333		(1,905)		(1,475)
Income tax expense		(185)		—		—		(185)
Net other comprehensive income		605		333		1,634		2,572
Transition adjustment related to adoption of ASU 2018-02 (see Note 1)		(2,707)		—		—		(2,707)
Balance, December 31, 2019	$	(23,916)	$	(5,877)	$	1,634	$	(28,159)