Schedule I Condensed Financial Information of Registrant Parent Company Only

12 Months Ended

Dec. 31, 2019

Condensed Financial Information Disclosure [Abstract]

Schedule I Condensed Financial Information of Registrant Parent Company Only

Schedule I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLY

VICI PROPERTIES INC.

CONDENSED BALANCE SHEETS

(In thousands, except share and per share data)

	December 31, 2019			December 31, 2018
Assets
Cash and cash equivalents	$	13,912		$	377,704
Restricted cash	—			48
Short-term investments	—			520,877
Other assets	159			2,150
Due from affiliates	838			133
Investment in subsidiaries	8,087,905			6,033,310
Total assets	$	8,102,814		$	6,934,222
Liabilities
Other liabilities	$	576		$	486
Dividends payable	137,056			116,287
Total liabilities	137,632			116,773
Stockholders’ equity
Common stock, $0.01 par value, 700,000,000 shares authorized and 461,004,742 and 404,729,616 shares issued and outstanding at December 31, 2019 and December 31, 2018, respectively	4,610			4,047
Preferred stock, $0.01 par value, 50,000,000 shares authorized and no shares outstanding at December 31, 2019 and 2018	—			—
Additional paid in capital	7,817,582			6,648,430
Accumulated other comprehensive loss	(65,078		)	(22,124		)
Retained earnings	208,068			187,096
Total stockholders’ equity	7,965,182			6,817,449
Total liabilities and stockholders’ equity	$	8,102,814		$	6,934,222

See accompanying Notes to Condensed Financial Information

Schedule I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLY

VICI PROPERTIES INC.

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(In thousands)

	Year Ended December 31,						Period from October 6, 2017 to December 31, 2017
	2019			2018
Expenses
General and administrative	—			78			—
Total expenses	—			78			—
Equity in earnings of investment in subsidiary	$	532,699		$	516,116		$	—
Interest income	13,265			7,581			282
Income before income taxes	545,964			523,619			282
Income taxes	—			—			—
Net income	$	545,964		$	523,619		$	282
Other comprehensive income
Net income	$	545,964		$	523,619		$	282
Unrealized loss on cash flow hedges - investment in subsidiaries	(42,954		)	(22,124		)	—
Comprehensive income	$	503,010		$	501,495		$	282

See accompanying Notes to Condensed Financial Information

Schedule I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLY

VICI PROPERTIES INC.

CONDENSED STATEMENTS OF CASH FLOWS

(In thousands)

	Year Ended December 31,						Period from October 6, 2017 to December 31, 2017
	2019			2018
Cash flows from operating activities
Net income	$	545,964		$	523,619		$	282
Adjustments to reconcile net income to cash flows provided by operating activities:
Equity in income from subsidiaries	(532,699		)	—			—
Distributions of earnings from subsidiaries	13,334			—			—
Change in operating assets and liabilities:
Change in other assets	48			(2,150		)	—
Change in other liabilities	1,370			270			—
Change in intercompany balances, net	(1,985		)	(614		)	98,813
Cash flows from operating activities	26,032			521,125			99,095
Cash flows from investing activities
Investment in subsidiary	(1,700,748		)	(1,838,205		)	(1,000,000		)
Distributions from subsidiaries	232,875			357,781			—
Investments in short-term investments	(342,767		)	(691,239		)	—
Maturities of short-term investments	760,419			170,362			—
Cash flows used in investing activities	(1,050,221		)	(2,001,301		)	(1,000,000		)
Cash flows from financing activities
Proceeds from follow-on offering of common stock	1,164,307			694,374			—
Proceeds from private placement of common stock	—			—			964,376
Proceeds from initial public offering of common stock	—			1,307,119			—
Dividends paid	(503,958		)	(262,682		)	—
Mandatory debt conversion costs	—			—			(13		)
Cash flows provided by financing activities	660,349			1,738,811			964,363
Net increase in cash and cash equivalents	(363,840		)	258,635			63,458
Cash, cash equivalents and restricted cash, beginning of period	377,752			119,117			55,659
Cash, cash equivalents and restricted cash, end of period	$	13,912		$	377,752		$	119,117

See accompanying Notes to Condensed Financial Information

Schedule I

CONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLY

VICI PROPERTIES INC.

NOTES TO CONDENSED FINANCIAL INFORMATION

1. Background and Basis of Presentation

The condensed parent company financial information has been prepared in accordance with Rule 12-04, Schedule 1 of Regulation S-X, as the restricted net assets of VICI Properties Inc. and its subsidiaries exceed 25% of the consolidated net assets of VICI Properties Inc. and its subsidiaries (the “Company”). This information should be read in conjunction with the Company’s consolidated financial statements included elsewhere in this filing.

2. Restricted net assets of subsidiaries

VICI Properties 1 LLC (“VICI PropCo”), a Delaware limited liability company and an indirect wholly owned subsidiary of VICI Properties, Inc., has certain restrictions on its ability to pay dividends or make intercompany loans and advances pursuant to financing arrangements. On December 22, 2017, VICI PropCo entered into a credit agreement (the “Credit Agreement”) governing the Term Loan B Facility and the Revolving Credit Facility. The Credit Agreement contains customary covenants that, among other things, limit the ability of VICI PropCo and its restricted subsidiaries to: (i) incur additional indebtedness; (ii) merge with a third party or engage in other fundamental changes; (iii) make restricted payments; (iv) enter into, create, incur or assume any liens; (v) make certain sales and other dispositions of assets; (vi) enter into certain transactions with affiliates; (vii) make certain payments on certain other indebtedness; (viii) make certain investments; and (ix) incur restrictions on the ability of restricted subsidiaries to make certain distributions, loans or transfers of assets to VICI PropCo or any restricted subsidiary. These covenants are subject to a number of exceptions and qualifications, including the ability to make unlimited restricted payments to maintain our REIT status and to avoid the payment of federal or state income or excise tax, the ability to make restricted payments in an amount not to exceed 95% of our Funds from Operations (as defined in the Credit Agreement) subject to no event of default under the Credit Agreement and pro forma compliance with the financial covenant pursuant to the Credit Agreement, and the ability to make additional restricted payments in an aggregate amount not to exceed the greater of 0.6% of Adjusted Total Assets (as defined in the Credit Agreement) or $30,000,000. Commencing with the first full fiscal quarter ended after December 22, 2017, if the outstanding amount of the Revolving Credit Facility plus any drawings under letters of credit issued pursuant to the Credit Agreement that have not been reimbursed as of the end of any fiscal quarter exceeds 30% of the aggregate amount of the Revolving Credit Facility, VICI PropCo and its restricted subsidiaries on a consolidated basis would be required to maintain a maximum Total Net Debt to Adjusted Total Assets Ratio, as defined in the Credit Agreement, as of the last day of any applicable fiscal quarter.

The Second Lien Notes were issued on October 6, 2017, pursuant to an indenture (the “Second Lien Notes Indenture”) by and among VICI PropCo and its wholly owned subsidiary, VICI FC Inc. (together, the “Second Lien Notes Issuers”), the subsidiary guarantors party thereto, and UMB Bank National Association, as trustee. The Second Lien Notes Indenture contains covenants that limit the Second Lien Notes Issuers’ and their restricted subsidiaries’ ability to, among other things: (i) incur additional debt; (ii) pay dividends on or make other distributions in respect of their capital stock or make other restricted payments; (iii) make certain investments; (iv) sell certain assets; (v) create or permit to exist dividend and/or payment restrictions affecting their restricted subsidiaries; (vi) create liens on certain assets to secure debt; (vii) consolidate, merge, sell or otherwise dispose of all or substantially all of their assets; (viii) enter into certain transactions with their affiliates; and (ix) designate their subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of exceptions and qualifications, including the ability to declare or pay any cash dividend or make any cash distribution to VICI to the extent necessary for VICI to distribute cash dividends of 100% of our “real estate investment trust taxable income” within the meaning of Section 857(b)(2) of the Internal Revenue Code of 1986, as amended, certain restricted payments not to exceed the amount of our cumulative earnings (calculated pursuant to the Indenture as $30,000,000 plus 95% of our cumulative Adjusted Funds From Operations (as defined in the Indenture) less cumulative distributions, with certain other adjustments), and the ability to make restricted payments in an amount equal to the greater of 0.6% of Adjusted Total Assets (as defined in the Indenture) or $30,000,000. Subsequent to December 31, 2019, on February 20, 2020 we used the proceeds from the 2025 Notes to redeem in full the Second Lien Notes at a redemption price of 100% of the principal amount of the Second Lien Notes then outstanding plus the Second Lien Notes Applicable Premium, which resulted in a total redemption amount of approximately $537.5 million.

The November 2019 Senior Unsecured Notes were issued in November 2019, pursuant to indentures (the “2019 Senior Unsecured Notes Indentures”) by and among the Operating Partnership and VICI Note Co. Inc. (the “Co-Issuer” and, together with the Operating Partnership, the “2019 Senior Unsecured Notes Issuers”), the subsidiary guarantors party thereto and UMB Bank, National Association, as trustee. The 2019 Senior Unsecured Notes Indentures contains covenants that limit the 2019 Senior Unsecured Notes Issuers’ and their restricted subsidiaries’ ability to, among other things: pursuant to a indenture agreements

containing certain covenants limiting our ability (i) incur additional debt; (ii) create liens on assets; (iii) make distributions and pay dividends on or redeem or repurchase stock; (iv) make certain types of investments; (v) sell stock in certain subsidiaries; (vi) enter into agreements that restrict dividends or other payments from subsidiaries; (vii) enter into transactions with affiliates; (viii) issue guarantees of debt; and (ix) sell assets or merge with other companies. These covenants are subject to a number of exceptions and qualifications, including the ability to declare or pay any cash dividend or make any cash distribution to VICI to fund a dividend or distribution by VICI that is believes is necessary to maintain its status as a REIT or to avoid payment of any tax for any calendar year that could be avoided by reason of such distribution, and the ability to make certain restricted payments not to exceed 95% of our cumulative Funds From Operations (as defined in the 2019 Senior Unsecured Notes Indentures), plus the aggregate net proceeds from (i) the sale of certain equity interests in, (ii) capital contributions to, and (iii) certain convertible indebtedness of, the Operating Partnership.

The amount of restricted net assets the Company’s consolidated subsidiaries held as of December 31, 2019 was approximately $7.9 billion.

3. Commitments, contingencies, and long-term obligations

For a discussion of the Company’s commitments, contingencies, and long-term obligations under its senior secured credit facilities, see Note 7 of the Company’s consolidated financial statements.