| Item 2.01. | Completion of Acquisition or Disposition of Assets. |
On October 1, 2018, Gaming and Leisure Properties, Inc. (the “Company”) closed its previously announced transaction to acquire certain real property assets from Tropicana Entertainment Inc. (“Tropicana”) and certain of its affiliates pursuant to a Purchase and Sale Agreement (the “Real Estate Purchase Agreement”) dated April 15, 2018 between Tropicana and GLP Capital L.P., the operating partnership of the Company (“GLP Capital”), which was subsequently amended on October 1, 2018 (as amended, the “Amended Real Estate Purchase Agreement”). Pursuant to the terms of the Amended Real Estate Purchase Agreement, the Company acquired the real estate assets of Tropicana Atlantic City, Tropicana Evansville, Tropicana Laughlin, Trop Casino Greenville and the Belle of Baton Rouge (the “GLP Assets”) from Tropicana for an aggregate cash purchase price of $964.0 million and an affiliate of Eldorado Resorts, Inc. (“Eldorado”) purchased the real estate assets of Lumiere Place Casino & Hotel for a cash purchase price of $246.0 million, each exclusive of transaction fees and taxes. Eldorado also acquired the operating assets of these properties from Tropicana pursuant to an Agreement and Plan of Merger dated April 15, 2018 by and among Tropicana, GLP Capital, Eldorado and a wholly-owned subsidiary of Eldorado (the “Merger Agreement”) and will lease the GLP Assets from the Company pursuant to the terms of a newtriple-net unitary master lease with a15-year initial term, with no purchase option followed by four successivefive-year renewal periods (exercisable by Eldorado) on the same terms and conditions (the “Eldorado Master Lease”). In addition, on October 1, 2018 GLP Capital made a loan to Eldorado in the amount of $246.0 million in connection with Eldorado’s acquisition of Tropicana’s Lumière Place property, which loan will initially be secured by a deed of trust on Lumière Place (the “Lumière Loan”).
Initial annual rent under the Eldorado Master Lease is expected to be $87.6 million pursuant to terms similar to the Company’s existing master leases, except that for the first-five lease years the 2% annual escalation of building-based rent is subject to an adjusted revenue to rent ratio threshold for the properties in the aggregate of 1.2:1 and thereafter at 1.8:1, as described in more detail in the Eldorado Master Lease. The Lumière Loan will bear interest at a rate equal to (i) 9.09% (or approximately $22.4 million) until theone-year anniversary of the closing, and (ii) 9.27% (or approximately $22.8 million) until the second anniversary of the closing, when the loan is expected to mature (subject to the availability of threeone-year extensions under certain circumstances). Until theone-year anniversary of the closing, the Lumière Loan will be secured by a first mortgage lien on Lumière Place. On theone-year anniversary of the Lumière Loan, the mortgage and the related deed of trust on the Lumière Place property will terminate and the loan will continue unsecured. The parties anticipate that the Lumière Loan will be fully repaid on or prior to maturity by way of substitution of one or more additional Eldorado properties acceptable to Eldorado and the Company, which will be transferred to the Company and added to the Eldorado Master Lease.
The foregoing description of the Amended Real Estate Purchase Agreement, the Merger Agreement and the Eldorado Master Lease is qualified in its entirety by the full text of such agreements, as amended, which are attached as Exhibits 2.1, 2.2, 2.3 and 10.1 to this Current Report on Form8-K and incorporated by reference herein.
| Item 7.01. | Regulation FD Disclosure. |
On October 1, 2018, the Company issued a press release announcing closing of the transactions described above in Item 2.01 of this Current Report on Form8-K. A copy of the press release is furnished as Exhibit 99.1 hereto and incorporated herein by reference.
The information contained in this Item 7.01 is being “furnished” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise. The information in this Item 7.01 shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act or into any filing or other document pursuant to the Securities Exchange Act of 1934, as amended, except as otherwise expressly stated in any such filing.
| Item 9.01. | Financial Statements and Exhibits. |
| (b) | Pro Forma Financial Information. |
The unaudited pro forma consolidated combined financial statements of the Company as of June 30, 2018 and for the year ended December 31, 2017 and for the six months ended June 30, 2018, are incorporated herein by reference to pagesS-32 throughS-39 of the Company’s prospectus supplement dated September 17, 2018, filed with the U.S. Securities and Exchange Commission (the “Commission”) on September 19, 2018 which are attached as Exhibit 99.2 hereto and are incorporated by reference herein.
