ITEM 1.01 — Entry
into a Material Definitive Agreement.
On May 6, 2020, CyrusOne Inc., a
Maryland corporation (the “Company”), CyrusOne GP, a Maryland
statutory trust (the “General Partnership”), and CyrusOne LP, a
Maryland limited partnership (the “Operating Partnership”),
entered into sales agreements (each, a “Sales Agreement” and
collectively, the “Sales Agreements”) with each of J.P. Morgan
Securities LLC, Barclays Capital Inc., BMO Capital Markets Corp., Credit Agricole Securities (USA) Inc., Deutsche Bank
Securities Inc., Fifth Third Securities, Inc., Goldman Sachs & Co. LLC, Jefferies LLC,
KeyBanc Capital Markets Inc., Morgan Stanley & Co. LLC, MUFG Securities Americas Inc., RBC Capital Markets, LLC, Stifel,
Nicolaus & Company, Incorporated, SunTrust Robinson Humphrey, Inc. and TD Securities (USA) LLC (each, a “Sales
Agent” and, collectively, the “Sales Agents”) and,
as applicable, the relevant Forward Purchaser (as defined below), pursuant to which shares (the “Shares”)
of the Company’s common stock, par value $0.01 per share (the “Common
Stock”), having an aggregate gross sales price of up to $750,000,000 (the “Maximum
Amount”) may be offered and sold from time to time through the Sales Agents, acting as the Company’s sales
agents or, if applicable, as Forward Sellers (as defined below), or directly to the Sales Agents as principals for their own
accounts, in each case pursuant to the Company’s Registration Statement on Form S-3 (File No. 333-231203).
Subject to the terms and conditions of the
Sales Agreements, the Sales Agents, whether acting as the Company’s sales agents or as Forward Sellers, will use their commercially
reasonable efforts, consistent with their normal trading and sales practices and applicable law and regulations, to sell the Shares
that may be designated by the Company (if acting as the Company’s sales agents) and the Shares borrowed by the relevant Forward
Purchasers pursuant to the relevant Sales Agreements (if acting as Forward Sellers), in each case on the terms and subject to the
conditions of the Sales Agreements. Sales, if any, of the Shares made through the Sales Agents, as the Company’s sales agents,
or as Forward Sellers pursuant to the Sales Agreements, may be made (1) in “at the market” offerings (as defined in
Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”)) by means of ordinary brokers’
transactions at market prices prevailing at the time of sale, including sales made on the NASDAQ Global Select Market, sales made
to or through market makers and sales made through other securities exchanges or electronic communications networks and (2) in
such privately negotiated transactions, which may include block trades, as the Company and any Sales Agent or Forward Seller may
agree.
Under the terms of the Sales Agreements,
the Company also may sell Shares to any Sales Agent as principal for its own account. If the Company sells Shares to any Sales
Agent as principal, it will enter into a separate terms agreement (each, a “Terms Agreement”, and collectively,
the “Terms Agreements”) setting forth the terms of such transaction, and the Company will describe the agreement
in a separate prospectus supplement or pricing supplement. In any such sale to a Sales Agent as principal, the Company may agree
to pay the applicable Sales Agent a commission or underwriting discount that may exceed 2.0% of the gross sales price per share
of Common Stock sold to such Sales Agent, as principal.
The Sales Agreements entered into with
each of J.P. Morgan Securities LLC, Barclays Capital Inc., BMO Capital Markets Corp., Credit Agricole Securities (USA) Inc., Deutsche
Bank Securities Inc., Goldman Sachs & Co. LLC, Jefferies LLC, KeyBanc Capital Markets Inc., Morgan Stanley & Co. LLC,
MUFG Securities Americas Inc., RBC Capital Markets, LLC and TD Securities (USA) LLC (each, a “Forward/Primary Sales Agreement”
and collectively, the “Forward/Primary Sales Agreements”) contemplate that, in addition to the issuance and
sale by the Company of Shares to or through the Sales Agents as the Company’s sales agents or as principals, the Company
may enter into separate forward sale agreements (each, together with any related pricing supplement, a “Forward Sale
Agreement” and collectively, the “Forward Sale Agreements”), with any of, respectively, JPMorgan
Chase Bank, National Association, Barclays Bank PLC, Bank of Montreal, Crédit Agricole Corporate and Investment Bank, Deutsche
Bank AG, London Branch, Goldman Sachs & Co. LLC, Jefferies LLC, KeyBanc Capital Markets Inc., Morgan Stanley & Co. LLC,
MUFG Securities EMEA plc, Royal Bank of Canada and The Toronto-Dominion Bank, or one of their respective affiliates (in such capacity,
each, a “Forward Purchaser” and collectively, the “Forward Purchasers”). If the Company
enters into a Forward Sale Agreement with any Forward Purchaser, the Company expects that such Forward Purchaser, acting in accordance
with the mutually accepted instructions related to such Forward Sale Agreement, will attempt to borrow and sell, through the relevant
Sales Agent, acting as sales agent for such Forward Purchaser, Shares to hedge such Forward Purchaser’s exposure under such
Forward Sale Agreement. In this Current Report, a Sales Agent, when acting as sales agent for the relevant Forward Purchaser,
is referred to as, individually, a “Forward Seller” and collectively, the “Forward Sellers”.
Unless otherwise expressly stated or the context otherwise requires, references herein to the “related” or “relevant”
Forward Purchaser mean, with respect to any Sales Agent, the affiliate of such Sales Agent that is acting as Forward Purchaser
or, if applicable, such Sales Agent acting in its capacity as Forward Purchaser.
The Sales Agreements entered into with each
of Fifth Third Securities, Inc., Stifel, Nicolaus & Company, Incorporated and SunTrust Robinson Humphrey, Inc. (each, a “Primary
Sales Agreement” and collectively, the “Primary Sales Agreements”) do not contemplate that such financial
institution or its affiliate will enter into forward transactions with the Company, but do not prohibit the Company from entering
into the Forward Sale Agreements.
In no event will the aggregate gross sales
price of Shares sold by the Company to or through the Sales Agents, acting as sales agents for the Company or as principals, and
by the Forward Purchasers through the Forward Sellers, exceed the Maximum Amount.
The Company will not initially receive any
proceeds from any sale of Shares borrowed by a Forward Purchaser and sold through a Forward Seller. The Company expects to fully
physically settle each Forward Sale Agreement, if any, with the relevant Forward Purchaser on one or more dates specified by the
Company on or prior to the maturity date of such Forward Sale Agreement, in which case the Company expects to receive aggregate
cash proceeds at settlement equal to the number of shares of the Company’s common stock underlying such Forward Sale Agreement
multiplied by the then-applicable forward price per share. If the Company elects to cash settle any Forward Sale Agreement, the
Company may not receive any proceeds and the Company may owe cash to the relevant Forward Purchaser. If the Company elects to net
share settle any Forward Sale Agreement, the Company will not receive any cash proceeds, and the Company may owe Shares to the
relevant Forward Purchaser.
The compensation to each Sales Agent will
be a mutually agreed commission that will not exceed, but may be lower than, 2.0% of the gross sales price of the Shares sold through
it as the Company’s sales agent pursuant to the applicable Sales Agreement. The compensation to each Sales Agent acting as
a Forward Seller will be a mutually agreed commission in the form of a reduction to the initial forward price under the related
Forward Sale Agreement that will not exceed, but may be lower than, 2.0% of the gross sales price of the borrowed Shares sold through
such Sales Agent, acting as Forward Seller, during the applicable forward hedge selling period for such Shares (which gross sales
price will be adjusted for daily accruals based on a floating interest rate and specified amounts related to the expected dividends
on the Shares if an “ex-dividend” date occurs during such forward hedge selling period).
The Company intends to contribute the net
proceeds from any sales of Shares to or through the Sales Agents (as the Company’s sales agents or principals) and the net
proceeds, if any, from the settlement of any Forward Sale Agreements to the Operating Partnership in exchange for an equivalent
number of newly issued operating partnership units in accordance with the partnership agreement of the Operating Partnership. The
Operating Partnership intends to use the proceeds contributed by the Company for general corporate purposes, which may include
funding future acquisitions, investments or capital expenditures and repaying outstanding indebtedness,
including borrowings under the Company’s senior unsecured revolving credit facility.
The Company, any Sales Agent or any Forward
Purchaser may at any time suspend an offering of Shares pursuant to the terms of the applicable Sales Agreement. The offering of
Shares pursuant to any Sales Agreement will terminate upon the earlier of (i) the sale of the Shares under the Sales Agreements
(including Shares sold by the Company or to or through the Sales Agents and borrowed Shares sold through the Sales Agents, acting
as Forward Sellers) and the Terms Agreements, if any, having an aggregate gross sales price equal to the Maximum Amount and (ii)
with respect to a particular Sales Agreement, the termination of such Sales Agreement by the Company or by the applicable Sales
Agent or Forward Purchaser as permitted therein.
The above summary is qualified in its entirety
by reference to, as applicable, the form of Forward/Primary Sales Agreement (which includes as an exhibit thereto the form of Forward
Sale Agreement) filed as Exhibit 1.1 hereto and the form of Primary Sales Agreement filed as Exhibit 1.2 hereto, each incorporated
herein by reference.
The opinion of Venable LLP, relating to
the validity of the Common Stock offered and sold pursuant to the Sales Agreements, is filed herewith as Exhibit 5.1.
The Sales Agents, Forward Purchasers and
their respective affiliates have in the past performed commercial banking, investment banking and advisory services for the Company
from time to time for which they have received customary fees and reimbursement of expenses and may, from time to time, engage
in transactions with and perform services for the Company in the ordinary course of their business for which they may receive customary
fees and reimbursement of expenses.