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VICI Properties Inc. (the “Company”) and VICI Properties L.P. (the “Operating Partnership”) entered into an underwriting agreement (the “Underwriting Agreement”), dated as of March 3, 2021, with Morgan Stanley & Co. LLC, BofA Securities, Inc., Citigroup Global Markets Inc. and Deutsche Bank Securities Inc., as representatives of the several underwriters listed on Schedule I thereto (collectively, the “Underwriters”), and Morgan Stanley & Co. LLC, BofA Securities, Inc., Citigroup Global Markets Inc. and Deutsche Bank Securities Inc., as forward sellers (in such capacities, the “Forward Sellers”), and the Forward Purchasers (as defined below),
relating to the offer and sale of up to 69,000,000 shares of the Company’s common stock, $0.01 par value per share (the “Common Stock”) on a forward basis (including up to 9,000,000 shares of Common Stock pursuant to the Underwriters’ option to purchase additional shares, which option the Underwriters exercised in full), at a public offering price of $29.00 per share of Common Stock (the “Offering”). The Offering was made pursuant to the Company’s effective shelf registration statement on Form S-3 (No. 333-227641) filed with the Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”) on October
1, 2018. The material terms of the Offering are described in the prospectus supplement dated March 3, 2021. The Offering closed on March 8, 2021.
Under the Underwriting Agreement, the Company and the Operating Partnership made certain customary representations, warranties and covenants in the Underwriting Agreement concerning the Company, the Operating Partnership and the registration statement and the
Company has also agreed to indemnify the Underwriters, the Forward Sellers and the Forward Purchasers against certain liabilities, or to contribute to payments that such parties may be required to make in respect of those liabilities.
Certain of the Underwriters and their respective affiliates have, from time to time, performed, and may in the future perform, various financial advisory, commercial banking and investment banking services for the Company, for which they received or will receive customary fees and expenses, including serving as: (i) lenders and/or administrative agents under the Company’s revolving credit facility, first lien term loan facility and bridge facilities; (ii) underwriters in the
Company’s initial public offering and underwriters or forward purchasers or forward sellers in certain of the Company’s follow-on offerings of Common Stock; (iii) initial purchasers of its senior unsecured notes issued in November 2019 and February 2020; and (iv) financial advisors in connection with various of the Company’s acquisition transactions.
In connection with the Offering, on March 3, 2021, the Company entered into forward sale agreements (the “Forward Sale Agreements”) with each of Morgan Stanley & Co. LLC, Bank of America, N.A., Citibank N.A. and Deutsche Bank AG, London Branch, as forward purchasers (in such capacities, the “Forward Purchasers”) relating to an aggregate of 69,000,000 shares of Common Stock (including up to 9,000,000 shares of Common Stock pursuant to the Underwriters’ option to purchase additional shares, which option the Underwriters exercised
in full). The Company expects to physically settle the Forward Sale Agreements (by the delivery of shares of Common Stock) and receive proceeds from the sale of those shares of Common Stock on the settlement date no later than approximately twelve months after the date of the prospectus supplement. Although the Company expects to settle the Forward Sale Agreements entirely by the physical delivery of shares of Common Stock in exchange for cash proceeds, the Company may elect cash settlement or net share settlement for all or a portion of the Company’s obligations under the Forward Sale Agreements. If the
Company elects to cash settle the Forward Sale Agreements, the Company may not receive any cash proceeds, and the Company may be required to pay cash to the Forward Purchasers in certain circumstances. If the Company elects to net share settle the Forward Sale Agreements, the Company will not receive any cash proceeds, and the Company may be required to deliver shares of Common Stock to the Forward Purchasers in certain circumstances. The Forward Sale Agreements provide for an initial forward sale price of $28.0575 per share (which is the
public offering price less the underwriting discount set forth on the front cover of the prospectus supplement for the Offering), subject to certain adjustments pursuant to the terms of the Forward Sale Agreements. The Company will not initially receive any proceeds from the sale of shares of Common Stock by the Forward Sellers.
The foregoing description of the Forward Sale Agreements does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the full text of the Forward Sale Agreements, which are attached hereto as Exhibits 1.2, 1.3, 1.4 and 1.5 and are incorporated by reference herein.
of Proceeds of Offering
At an initial forward sale price of $28.0575 per share (which is the public offering price per share, less the underwriting discount per share), in the event of full physical settlement of the Forward Sale Agreements, the Company would receive net proceeds, after estimated offering expenses, of approximately $1,935.0 million, subject to the price adjustment and other provisions of the Forward Sale Agreements. The Operating Partnership expects to use any cash proceeds contributed to it by the Company that the Company may receive upon settlement of the Forward Sale Agreements to fund a portion of the purchase price of the land and real estate assets
associated with The Venetian Resort Las Vegas and the Sands Expo and Convention Center in Las Vegas, Nevada and for general business purposes, which may include the acquisition, development and improvement of properties, capital expenditures, working capital and the repayment of indebtedness.
The amount of cash or number of shares of Common Stock the Company receives upon settlement of the Forward Sale Agreements, if any, will depend on the relevant settlement method, the timing of settlement, market interest rates and, if applicable under cash or net share settlement, the prevailing market price of the Common Stock during the period in which the Forward Purchasers or their respective affiliates unwind their hedge positions with respect to the Forward Sale Agreements. Settlement will occur on one or more dates specified by the
Company under the Forward Sale Agreements, which the Company expects to be no later than approximately twelve months from the date of the prospectus supplement, subject to acceleration by the Forward Purchasers upon the occurrence of certain events.
This Current Report on Form 8-K contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “anticipates,”“believes,”“estimates,”“expects,”“intends,”“plans,”“projects,”“targets,”“can,”“could,”“may,”“should,”“will,”“would” and similar expressions that do not relate to historical matters. All statements
other than statements of historical fact are forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance, or achievements. Among those risks, uncertainties and other factors are risks related to the Company’s ability to satisfy certain conditions to closing its pending acquisition on a timely basis or at all, market conditions related to the settlement of the Forward Sale Agreements and the Company’s expected use of proceeds. Important risk factors that may affect the
Company’s business, results of operations and financial position (including those stemming from the COVID-19 pandemic and changes in the economic conditions as a result thereof) are detailed from time to time in the Company’s filings with the Securities and Exchange Commission. The Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required by applicable law.