Item 1.01 Entry into a Material Definitive Agreement.
The disclosure under the Introductory Note is incorporated herein by reference.
Amended and Restated
Concurrently with the closing of the Mergers, a subsidiary of the Company entered into an amended and restated triple-net master lease with a subsidiary ofMGM with respect to the properties that are owned by consolidated subsidiaries of the Company as a result of the Mergers (the "Amended and RestatedMGM Master Lease Agreement "). The Amended and RestatedMGM Master Lease Agreement has an initial term of 25 years, with three 10-year tenant renewal options, and has an initial total annual rent of$860.0 million . Rent under the Amended and RestatedMGM Master Lease Agreement will escalate at a rate of 2.0% per annum for the first 10 years and thereafter at the greater of 2.0% per annum and the annual increase in the consumer price index ("CPI"), subject to a 3.0% cap. The tenant's obligations under the Amended and RestatedMGM Master Lease Agreement are guaranteed byMGM (the "MGM Master Lease Guaranty "). Upon the closing ofMGM's pending sale of the operations of theMirage Hotel & Casino (the "Mirage") toHard Rock International , the Company will enter into a new separate lease withHard Rock International related to the land and real estate assets of the Mirage which will have initial annual base rent of$90.0 million and other economic terms substantially similar to the Amended and RestatedMGM Master Lease Agreement , including a base term of 25 years with three 10-year tenant renewal options, escalation of 2.0% per annum (with escalation of the greater of 2.0% and the annual increase in CPI, capped at 3.0%, beginning in lease year 11) and minimum capital expenditure requirements of 1.0% of annual net revenue. Upon the entry into the lease withHard Rock International , the initial total annual rent under the Amended and RestatedMGM Master Lease Agreement will be reduced by$90.0 million .
The foregoing descriptions of the Amended and Restated
Tax Protection Agreement
Concurrently with the closing of the Mergers, the Company entered into a tax
protection agreement (the "Tax Protection Agreement") pursuant to which the
Company agreed, for a period of 15 years following the closing of the Mergers,
to indemnify
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disposition of a property owned directly or indirectly by MGP OP immediately prior to the Closing Date during the 15-year period following the closing of the Mergers, (2) a merger, consolidation, transfer of all assets of, or other significant transaction involving VICI OP pursuant to which the ownership interests ofMGM in VICI OP are required to be exchanged in whole or in part for cash or other property, (3) the failure of VICI OP to maintain approximately$8.5 billion of nonrecourse indebtedness allocable toMGM , which amount may be reduced over time in accordance with the Tax Protection Agreement, and (4) the failure to comply with certain tax covenants that would impact the tax liabilities ofMGM . In the event that the Company breaches restrictions in the Tax Protection Agreement, it will be liable for grossed-up tax amounts associated with the income or gain recognized as a result of such breach. In addition, the BREIT JV previously entered into a tax protection agreement withMGM with respect to built-in gain and debt maintenance related toMGM Grand Las Vegas andMandalay Bay , which is effective through mid-2029, and by acquiring MGP, the Company bears its 50.1% proportionate share in the BREIT JV of any indemnity under this existing agreement.
The foregoing description of the Tax Protection Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Tax Protection Agreement, which is attached hereto as Exhibit 10.3 and is incorporated herein by reference.
Operating Agreement of VICI OP
In connection with the Mergers, on the Closing Date, an Amended and Restated Limited Liability Company Agreement (the "LLC Agreement") governing VICI OP became effective. The following is a summary of the terms of the LLC Agreement and does not purport to be complete. The following summary is qualified in its entirety by reference to the full text of the LLC Agreement, which is attached . . .
Item 1.02 Termination of a Material Definitive Agreement.
Bridge Financing Commitment Letter
As a result of the consummation of the transactions pursuant to the Master Transaction Agreement described herein, the remaining commitments in respect of the Debt Commitment Letter dated as ofAugust 4, 2021 , by and amongMorgan Stanley Senior Funding, Inc. ,JPMorgan Chase Bank, N.A . andCitigroup Global Markets Inc. and any other lenders party thereto (the "Debt Commitment Letter") were terminated in their entirety and the Debt Commitment Letter terminated in accordance with its terms. The Debt Commitment Letter was filed as Exhibit 10.1 to the Company's Current Report on Form 8-K, filed with theSEC onAugust 5, 2021 , and is incorporated herein by reference.
Item 2.01 Completion of Acquisition or Disposition of Assets.
The disclosure under the Introductory Note is incorporated herein by reference.
Pursuant to the Master Transaction Agreement, at the effective time of the REIT
Merger, each outstanding Class A common share, no par value per share, of MGP
("MGP Common Shares") (other than MGP Common Shares then held in treasury by MGP
or owned by any of MGP's wholly owned subsidiaries) were converted into the
right to receive 1.366 (the "Exchange Ratio") shares of VICI Common Stock, plus
the right, if any, to receive cash in lieu of fractional shares of VICI Common
Stock into which such MGP Common Shares would have been converted pursuant to
the Master Transaction Agreement. The outstanding Class B common share, no par
value per share, of MGP, which was held by
Pursuant to the Master Transaction Agreement, at the effective time of the
Partnership Merger, each limited partnership unit in MGP OP (other than the
limited partnership units in MGP OP held by REIT Merger Sub or any subsidiary of
MGP OP), all of which were held by
million VICI OP Units, representing approximately 1 .3 % of the outstanding VICI OP Units.
VICI issued approximately 214.5 million shares of VICI Common Stock as
consideration in the REIT Merger. Based on the closing price of VICI Common
Stock on
The assertions embodied in the representations and warranties in the Master
Transaction Agreement and the other agreements described herein were made only
for purposes of the applicable agreements and as of the specified date (or
dates) set forth therein, were made solely for the benefit of the parties to the
applicable agreements, are modified or qualified by information in confidential
disclosure letters provided by each party to the other in connection with the
signing of the agreements, may be subject to a contractual standard of
materiality different from what might be viewed as material to stockholders or
shareholders, or may have been used for the purpose of allocating risk between
the parties. Accordingly, the representations and warranties in the agreements
are not necessarily characterizations of the actual state of facts about the
Company or MGP at the time they were made or otherwise and should only be read
in conjunction with the other information that the Company or MGP makes publicly
available in reports, statements and other documents filed with the
The foregoing description of the Master Transaction Agreement has been included
to provide investors with information regarding its terms and conditions. It
does not purport to be a complete description of the Master Transaction
Agreement and the transactions contemplated thereby and is qualified in its
entirety by reference to the full text of the Master Transaction Agreement,
which was filed as Exhibit 2.1 to the Company's Current Report on Form
8-K,
filed with the
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Item 2.03 Creation of a Direct Financial Obligation or an Obligation Under
an Off-Balance Sheet
Arrangement of the Registrant.
The disclosure under "Senior Notes Offering" and "Exchange Offers" in Item 1.01 is incorporated herein by reference.
Item 8.01 Other Events. BREIT Joint Venture Following the Mergers, the Company retained MGP's 50.1% ownership stake in the joint venture betweenMGP and Blackstone Real Estate Income Trust, Inc. ("BREIT JV"), which owns the real estate assets ofMGM Grand Las Vegas andMandalay Bay (the "BREIT JV Properties "). The BREIT JV lease is a triple-net lease with a subsidiary ofMGM (the "BREIT JV Lease") and remained unchanged. The BREIT JV Lease provides for current total annual base rent of approximately$303.8 million , of which approximately$152.2 million is attributable to MGP's investment in the BREIT JV, and an initial term of 30 years with two 10-year tenant renewal options. Rent under the BREIT JV Lease escalates at a rate of 2.0% per annum for the first fifteen years and thereafter at the greater of 2.0% per annum and the annual increase in CPI, subject to a 3.0% cap. The tenant's obligations under the BREIT JV Lease are guaranteed byMGM . In connection with the BREIT JV, subsidiaries of MGP entered into a secured mortgage loan secured primarily by mortgages on theBREIT JV Properties , and the share of such debt attributable to the Company or its subsidiaries is$1,503.0 million .
Second Amended and Restated Agreement of Limited Partnership of
On the Closing Date, VICI OP, as the limited partner, and
Press Releases
On
Item 9.01. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired
The audited consolidated financial statements of MGP and MGP OP as ofDecember 31, 2021 and 2020 and for the years endedDecember 31, 2021 , 2020 and 2019 are incorporated by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K, filed with theSEC onApril 18, 2022 .
(b) Pro Forma Financial Information
The unaudited pro forma condensed combined financial statements of the Company as of and for the year endedDecember 31, 2021 , giving effect to the Mergers, the other transactions contemplated by the Master Transaction Agreement and certain other pending or recently closed transactions, are incorporated by reference to Exhibit 99.2 to the Company's Current Report on Form 8-K, filed with theSEC onApril 18, 2022 .
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(d) Exhibits Exhibit No. Description 2.1* Master Transaction Agreement, datedAugust 4, 2021 , by and amongVICI Properties Inc. , MGM Growth Properties LLC,MGM Growth Properties Operating Partnership LP ,Venus Sub LLC ,VICI Properties L.P. ,VICI Properties OP LLC and MGM Resorts International (incorporated by reference to Exhibit 2.1 toVICI Properties Inc.'s Current Report on Form 8-K filed onAugust 5, 2021 ). 4.1 Indenture, dated as ofApril 29, 2022 , betweenVICI Properties L.P. andUMB Bank, National Association , as trustee. 4.2 First Supplemental Indenture, dated as ofApril 29, 2022 , betweenVICI Properties L.P. andUMB Bank, National Association , as trustee. 4.3 Form of Global Note representing the 4.375% Senior Notes due 2025 (included in Exhibit 4.2). 4.4 Form of Global Note representing the 4.750% Senior Notes due 2028 (included in Exhibit 4.2). 4.5 Form of Global Note representing the 4.950% Senior Notes due 2030 (included in Exhibit 4.2). 4.6 Form of Global Note representing the 5.125% Senior Notes due 2032 (included in Exhibit 4.2). 4.7 Form of Global Note representing the 5.625% Senior Notes due 2052 (included in Exhibit 4.2). 4.8 Indenture, dated as ofApril 29, 2022 , relating to the 5.625% Senior Notes due 2024, betweenVICI Properties L.P. ,VICI Note Co. Inc. andUMB Bank, National Association , as trustee. 4.9 Indenture, dated as ofApril 29, 2022 , relating to the 4.625% Senior Notes due 2025, betweenVICI Properties L.P. ,VICI Note Co. Inc. andUMB Bank, National Association , as trustee. 4.10 Indenture, dated as ofApril 29, 2022 , relating to the 4.500% Senior Notes due 2026, betweenVICI Properties L.P. ,VICI Note Co. Inc. andUMB Bank, National Association , as trustee. 4.11 Indenture, dated as ofApril 29, 2022 , relating to the 5.750% Senior Notes due 2027, betweenVICI Properties L.P. ,VICI Note Co. Inc. andUMB Bank, National Association , as trustee. 4.12 Indenture, dated as ofApril 29, 2022 , relating to the 4.500% Senior Notes due 2028, betweenVICI Properties L.P. ,VICI Note Co. Inc. andUMB Bank, National Association , as trustee. 4.13 Indenture, dated as ofApril 29, 2022 , relating to the 3.875% Senior Notes due 2029, betweenVICI Properties L.P. ,VICI Note Co. Inc. andUMB Bank, National Association , as trustee. 4.14 Form of Global Note representing the 5.625% Senior Notes due 2024 (included in Exhibit 4.8). 4.15 Form of Global Note representing the 4.625% Senior Notes due 2025 (included in Exhibit 4.9). 4.16 Form of Global Note representing the 4.500% Senior Notes due 2026 (included in Exhibit 4.10). 4.17 Form of Global Note representing the 5.750% Senior Notes due 2027 (included in Exhibit 4.11). 4.18 Form of Global Note representing the 4.500% Senior Notes due 2028 (included in Exhibit 4.12). 4.19 Form of Global Note representing the 3.875% Senior Notes due 2029 (included in Exhibit 4.13). 10.1* Amended and RestatedMaster Lease , by and betweenMGP Lessor, LLC andMGM Lessee, LLC , dated as ofApril 29, 2022 . 10.2 Amended and Restated Guaranty ofMaster Lease , by and between MGM Resorts International andMGP Lessor, LLC , dated as ofApril 29, 2022 . 10.3* Tax Protection Agreement, by and amongVICI Properties Inc. , VICIProperties OP LLC , MGM Resorts International and the other parties thereto, dated as ofApril 29, 2022 . 10.4 Amended and Restated Limited Liability Company Agreement of VICIProperties OP LLC . 10.5 Second Amended and Restated Agreement of Limited Partnership ofVICI Properties L.P.
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99.1 Press Release, datedApril 28, 2022 , announcing the expiration, final results and settlement of the Exchange Offers and related consent solicitations with respect to each series of notes issued byMGM Growth Properties Operating Partnership LP andMGP Finance Co-Issuer, Inc. 99.2 Press Release, datedApril 29, 2022 , announcing the closing of the transactions contemplated by the Master Transaction Agreement. 104 Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document). * Pursuant to Item 601(b)(2) of Regulation S-K, certain schedules and exhibits have been omitted from this Current Report on Form 8-K and will be furnished to theSEC supplementally upon request.
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