Stockholders' Equity

12 Months Ended

Dec. 31, 2023

Equity [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

In the third quarter of 2021, the Company entered into an Equity Distribution Agreement ("EDA") with six financial institutions known as an at-the-market stock offering program ("ATM program"), under which the Company may offer and sell shares of its common stock from time to time in "at-the-market" offerings with an aggregate gross sales price of up to $500 million. In connection with the ATM program, Cousins may, at its discretion, enter into forward equity sale agreements ("Forward Sales"). The use of Forward Sales would allow the Company to lock in a share price on the sale of shares of its common stock at the time the agreement is executed, but defer receiving the proceeds from the sale of shares until a later date, allowing the Company to better align such funding with its capital needs. Sales of shares of Cousins' stock through its banking relationships, if any, are made in amounts and at times to be determined by Cousins, but the Company has no obligation to sell any of the shares in the offering and may suspend sales in connection with the offering at any time. Sales of Cousins' common stock under Forward Sales, if undertaken, meet the derivatives and hedging guidance scope exception as the contracts are related to the Company's own stock. In February 2023, the Company filed a Form S-3 to renew the registration of its authorized shares. In conjunction with that Form S-3 filing, the Company entered into an Amendment to the EDA to allow for the continued issuance of shares under this ATM program.

On June 29, 2022, the Company issued 2.6 million shares of common stock that had been executed under Forward Sales at an average price of $39.92 per share for gross proceeds of $105.1 million. To date the Company has issued 2.6 million shares under the ATM program and has generated cash proceeds of $101.4 million, net of $1.1 million of compensation to be paid with respect to such Forward Sales, $1.7 million of dividends owed during the period the Forward Sales were outstanding, and $900,000 of other transaction related costs. To the extent, prior to settlement, shares sold under Forward Sales were potentially dilutive during the period under the treasury stock method, the impact of such dilution is disclosed in the calculation included in note 17. The Company did not issue any shares under the ATM program during the year ended December 31, 2023 and did not have any outstanding Forward Sales for the sale of its common stock as of December 31, 2023 or 2022.

On April 21, 2022, the Company purchased its partner's 10% joint venture interest in HICO Avalon, LLC and HICO Avalon II, LLC, which consisted of the 8000 and 10000 Avalon office properties. This transaction did not result in a change in control and the difference between the $43.4 million purchase price of our partner's interest, which included a promote related to increases in fair value in excess of cost, and the $15.8 million book value of the outside partner's non-controlling interest was recorded as additional paid-in capital in the equity section of the Company's consolidated balance sheet. The Company's consolidated basis in Avalon's assets and liabilities was unchanged by this transaction.

The annual offering period for the Cousins Employee Stock Purchase Plan ("ESPP") ended on November 30, 2023 and 2022. Employees purchased a total of 25,441 shares in 2023 and 22,909 in 2022 under the ESPP. In both 2023 and 2022, the Company settled the employee purchase of shares through the ESPP by issuing treasury shares to participants. In 2023, the 25,441 shares sold had a basis of $1.5 million and, in 2022, the 22,909 shares sold had a basis of $1.3 million.

Ownership Limitations — In order to minimize the risk that the Company will not meet one of the requirements for qualification as a REIT, the Company's Articles of Incorporation include certain restrictions on the ownership of more than 3.9% of the Company’s total common and preferred stock, subject to waiver by the Board of Directors.

Distribution of REIT Taxable Income — The following reconciles dividends paid and dividends applied in 2023, 2022, and 2021 to meet REIT distribution requirements ($ in thousands):

	2023		2022		2021
Common dividends	$	194,144	$	192,275	$	182,839
Dividends treated as taxable compensation to employees	(308)		(231)		(192)
Dividends in excess of current year REIT distribution requirements	(39,933)		—		—
Dividends applied to meet current year REIT distribution requirements	$	153,903	$	192,044	$	182,647

Tax Status of Distributions — The following summarizes the components of the taxability of the Company’s common stock distributions for the years ended December 31, 2023, 2022, and 2021:

	Total  Distributions Per Share		Ordinary Dividends		Long-Term Capital Gain		Non Dividend Distributions		Unrecaptured Section 1250 Gain		Section 199A Dividends		Section 1061 One Year Amounts Disclosure (1)		Section 1061 Three Year Amounts Disclosure (1)
2023	$	1.280000	$	1.008002	$	0.008302	$	0.263696	$	—	$	1.008002	$	0.008302	$	0.008302
2022	$	1.270000	$	0.880788	$	0.389212	$	—	$	0.045470	$	0.880788	$	0.389212	$	0.389212
2021	$	1.230000	$	1.230000	$	—	$	—	$	—	$	1.230000	$	—	$	—

(1) Amounts included in Box 2a, Total Capital Gain Distributions, for purposes of section 1061 of the Internal Revenue Code. Section 1061 is generally applicable to direct and indirect holders of “applicable partnership interests."